Holdridge v. The Farmers & Mechanics' Bank of Rochester

• Decision Date: 10 October 1867
• Court: Michigan Supreme Court
• Parties: Pliney B. Holdridge v. The Farmers & Mechanics' Bank of Rochester

16 Mich. 66

Pliney B. Holdridge v. The Farmers & Mechanics' Bank of Rochester

Supreme Court of Michigan

October 10, 1867

Heard October 10, 1867 [Syllabus Material]

Error to Livingston circuit.

This was an action on two promissory notes made by Beir, Crouch Holdridge & Co., to the order of, and indorsed by A Vickery.

Defendant pleaded the general issue.

Plaintiffs amended their declaration by striking out the name of Crouch, and setting forth that he was a partner with said defendants when the indebtedness was incurred; but that afterwards plaintiff made a separate settlement with him, whereby, in consideration of the payment of $ 599.32 to be made by said Crouch, he discharged him from all individual liability to pay said firm debt.

Previous to the amendment of said declaration, plaintiff took certain depositions tending to prove the original partnership.

On the trial the said depositions, and the notes, were read subject to objection.

The defendants proved the discharge of said Crouch by plaintiff's written release.

Judgment was rendered for plaintiff.

The charges of the court below are stated in the opinion.

Judgment affirmed, with costs to the defendant in error in the court below and in this court.

O. Hawkins, for plaintiff in error, Holdridge:

1. The depositions taken in the cause before one party was stricken out, were inadmissible on an issue joined after the depositions were taken, as between the parties to the suit then on trial, upon new pleadings.

There is no authority for taking depositions out of the state, except under the statute. See Comp. L., § 4244.

And then only after issue joined between the parties.

It may be said the law of 1859, act No. 181, authorizes the cause to proceed. We say it does not. It only authorizes a suit to be brought either in law or in equity against the remaining joint copartners, or joint debtors. See Laws of 1859, p. 509, § 3.

2. It will not be denied that the discharge of one of a number of joint debtors at the common law, discharges the same as though a collection had been made in full of one joint debtor upon execution: Byles on Bills, pp. 188-306; 4 Bd. and El., 675; 1 Bos. and Pul., 630; 2 Bro. and B., 38; Edwards on Bills, 540; 1 Parsons on Notes and Bills, 250; 1 Hill 185.

3. The plaintiff was bound to prove the allegations respecting the discharge of the defendant Crouch.

4. The greatest strictness is required in pleading a statute of this kind, and any variance will be fatal: 5 Hill 461; 1 Barb. 185.

The release, as proven by the defendant, shows that it was made in pursuance of chapter 257 of the laws of 1838, and such acts as have been passed amending the same. It certainly does not refer to any law of Michigan or New York having reference to the subject. Matter of the release, therefore, is unavailable: Ib.

G. V. N. Lothrop, for defendants in error:

1. The objection to the admission of the depositions can not be supported.

They are correctly entitled in the suit as it stood when they were taken. And the parties against whom they were used were all parties when the depositions were taken. They had full privilege of cross-examination, and the issue remained the same as to them.

Even in a subsequent suit, where the subject matter is the same, a substantial identity of parties is sufficient to authorize the use of depositions taken in a former suit: 1 Greenl. Ev., § 55; 1 Ad. and El.; 27 Penn. 138.

Neither an amendment of pleadings, which does not change the issue, nor a discontinuance as to a party, is sufficient ground for excluding depositions already taken: 36 Me. 71; 27 Ala. 142.

2. The second error assigned is of no force, unless the ground taken in the third assignment of errors can be sustained. It is enough to say that the notes were those of the only persons who, on the facts stated in the pleadings, were then personally bound.

3. Was Crouch, one of the firm of Bier, Crouch, Holdridge & Co., discharged by the release of October 10th, 1864 ?

The court below held that he was, and that, therefore, a recovery could be had on their proportion of the debt against the other partners.

The release purports to have been made in New York, and under the laws thereof: 3 Rev. Stat. of N. Y., p. 65.

But our act of 1859 is to the same effect, and in nearly the same words: Sess. L. 1859, p. 506.

The contract was made in New York, and was to be performed there. It was, therefore, subject to the laws of New York: 4 Mich. 450; 3 Comst. 269.

A discharge, good and lawful by the law of the place where the contract was made or to be performed, is to be held of the same validity and effect in the courts of every other state: Story's Confl. L., §§ 331-7; 4 Cow. 508, note.

The above proposition, of course, has this limit, that the law of a foreign place will not receive effect in the courts of the state where the action is brought, when to do so would be against its fundamental laws, or against public policy, or in violation of the just rights of its own citizens: Story's Confl. L., § 348; 4 Cow. 508, note; 6 Hill 529.

But in this case the discharge in question is fully sanctioned by our own law: L. 1859, p. 506.

This, then, is a case where the discharge has the same effect by the lex loci, and by the lex fori.

In a word, the old technical rule which made a discharge of one partner a discharge of all, has been repealed in both states.

Wherever the law permits the discharge of one joint debtor, the strict technical rule has no application. This was long ago ruled in the case of a discharge under insolvent laws: 3 Caines 4.

Christiancy, J. Campbell and Cooley, JJ. concurred. Martin, Ch. J. did not sit.

OPINION

Christiancy J.:

We see no ground for the objection to the admission of the depositions. The amendment of the declaration after the depositions were taken, leaving out one of the defendant partners who had paid his portion of the debt and had been discharged, did not alter the substance of the issue as to any fact to which the depositions related. See Wright v. Tatham, 1 Ad. and El., 3; Medcalf v. Seccomb, 36 Me. 71; Goldsmith v. Picard, 27 Ala. 142; Height v. Heseinger, 27 Pa. 138; 1 Greenl. Ev., § 35.

The second assignment of error raises the question whether the notes were properly admitted in evidence under the common counts against those parties only who remained defendants in the amended declaration.

Crouch having been shown to have been one of the partners when the notes were made, and his name appearing in the signature of the partnership name, this question will depend upon the effect of the release to Crouch. If that release was valid, and had the effect to release Crouch, leaving the other partners liable to their proportion of the joint debt, then the notes, after this proof had been given (if not before), were clearly admissible, and, in legal effect, they were, for the balance remaining due upon them, the notes of the remaining defendants only. If there was any legal objection to their admission at the time they were introduced, that objection was removed by the defense introducing the release, if its effect was as above supposed.

Did, then, this release, purporting to discharge Crouch only, operate as a release of one joint debtor at common law to discharge all the parties jointly liable, as claimed by the plaintiff in error, or was its effect restricted by any statute of New York or of this state, or by comity, so as to discharge Crouch only, leaving the other defendants jointly liable for their portion of the debt? This is the only remaining question.

The contracts (the two promissory notes), upon which the release was intended to operate, were made, and, by their terms, were to be performed in the state of New York, and the release was executed there. The obligation created by the contracts, as well as the legal effect of the release, are, therefore, primarily to be determined by the laws of that state. See, as to the contracts, Story's Confl. of Laws, §§ 242 to 248, 262 (a); Hyde v. Goodnow, 3 Comst. 269; Bissell v. Lewis, 4 Mich. 450. As to the release, Story's Confl. of Laws, §§ 331 to 337, and authorities there cited.

It is not denied that under the statute of New York "for the relief of partners and joint debtors" (Chapter 258, Laws of 1838, 2 Rev. Stat., ed. of 1852, p. 176), it was competent for the plaintiff to have executed a release to Crouch for his portion of the joint debt, without affecting the liability of the other partners for their proportion of the debt. But it is insisted by the plaintiff in error, that, in order thus to restrict the effect of the release, it must refer to that statute to show that it was executed under its provisions; and that the reference in the release to chapter 157 instead of 158, is erroneous, the former chapter not referring to this subject.

In support of the proposition, that the...