Horatio Slater, Plaintiff In Error v. Charles Emerson

• Decision Date: 01 December 1856
• Citation: 15 L.Ed. 626,60 U.S. 224,19 How. 224
• Parties: HORATIO N. SLATER, PLAINTIFF IN ERROR, v. CHARLES EMERSON
• Court: U.S. Supreme Court

60 U.S. 224

19 How. 224

15 L.Ed. 626

HORATIO N. SLATER, PLAINTIFF IN ERROR, v. CHARLES EMERSON.

December Term, 1856

THIS case was brought up, by writ of error, from the Circuit Court of the United States for the district of Massachusetts.

The facts are stated in the opinion of the court.

It was argued by Mr. Bates and Mr. Bartlett for the plaintiff in error, and by Mr. Hutchins upon a brief filed by himself and Mr. Choate for the defendant.

The following points on behalf of the plaintiff in error are taken from the brief of Mr. Bartlett, as being more condensed than those stated in the brief of Mr. Bates:

I. The single question is, whether by the true and rational construction of the contract it was agreed and understood between the parties that the doing the work within the time prescribed was a condition on which the obligation of plaintiff to give his notes was to depend.

a. It is not sufficient to say that the parties, if such was their intent, might have expressed it so in terms, or might have secured damages for non-performance by an independent covenant. The books abound in cases where parties having inartificially expressed their purpose, the court have construed their agreement to be dependent. This want of express terms, therefore, though it may possibly lead in doubtful cases to a presnmption, is of value solely in that contingency.

b. We are to find, then, either from the reason of the thing, looking at the position of the parties and the surrounding circumstances, or by the application of the settled rules of construction, or by both, what was the intent of the parties; and,

1. The position of the parties is new and unusual. It is believed that a similar case is not to be found in the books. Usually the controversy is between a party contracting to perform and a party who is to enjoy the benefit of the thing to be performed. Here the question is upon the construction of a contract collateral to another, between other parties, which may be called the principal contract; and the entire direct fruits of performance are to be enjoyed by one of those other parties.

2. The extrinsic evidence shows that at the time of making the contract in question another negotiation was, with the knowledge of all parties, pending between one of the parties to the principal contract and a third party, of great pecuniary importance, the consummation of which was entirely dependent on the ability of one of the parties to open its road at a fixed time. That fixed time was the precise period prescribed for the completion of the work by the contract in question. (Ammidown's Testimony.)

3. Such are the surrounding circumstances, and before examining the terms of the contract and the settled rules of construction, it may be fairly asked whether defendent in error, who was already performing and bound to perform the work under another contract for the same remuneration, would be likely to agree that the covenant of plaintiff in error should be dependent, and this, too, when the notes to be given him were not to pay for the labor to be performed under the contract, but to an existing indebtedness of railroad to defendant in error. (Willis's Testimony.) And also whether plaintiff in error would be likely to make any other than a dependent agreement to pay on condition an old debt of a third party.

II. With these preliminary views, we proceed to examine the terms of the contract, and the usual rules of construction a. The terms of agreement by defendant in error are, 'that he will complete all the bridge work to be done by him for the Boston and New York Central railroad, ready for laying down the iron rails for one track, on the first day of December next.

b. The agreement on the part of the plaintiff in error is, 'that, in consideration of the premises, he will pay, within two days from the date hereof, the sum of $4,400 in cash; and that he will give said Emerson, on the completion of the bridges, and when the rails for one track are laid to the foot of Summer street, his five notes for $2,000 each, payable in six months; said notes, when paid, to be applied toward the indebtedness of said Railroad Company to said Emerson.'

1. The agreement on the part of plaintiff is 'in consideration of the premises,' and technically these are apt words to create a condition. (Thorpe v. Thorpe, 1 Ld. Raymond, 665; Ackerly v. Vernon, Willes, 157.)

2. That the agreement to give the notes was at least dependent upon prior performance, would seem free from all doubt. This is tested by considering whether an action on the contract could have been maintained before the work was done.

It falls clearly in this respect within the technical rule. 'When a day is appointed for the payment of money, &c., and the day is to happen after the thing which is the consideration of the money, &c., is to be performed,' no action can lie. (Bean v. Atwater, 4 Connecticut, 9; Pordage v. Cole, 1 Saunders, 320; Day v. Dox, 9 Wendell, 129.)

The fact that the notes were not to be given upon performance, but at a period after performance, does not affect it. This only shows that it does not belong to another class of dependent agreements, viz: Where two acts are to be done at the same time, or cases of concurrent covenants, as they are called. (Glazebrook v. Woodrow, 8 T. R., 374; Williams v. Healy, 3 Denio, 363; Gainzly v. Price, 16 Johnson, 267.)

3. Nor does the fact that payment of part of the consideration (viz: the $4,400) was to be made before performance, affect the question whether the agreement for a final payment was dependent or independent. The old case of Terry v. Duntzie, (2 Henry Blackstone, 389,) from which the opposite doctrine was derived, was unfounded in reason, and has been declared not to be law here and in England. (Cunningham v. Morrell, 10 Johnson, 203; Hopkins v. Elliot, 5 Wendell, 496; Grant v. Johnson, 1 Selden, 247; Johnson v. Reed, 9 Mass., 78; Lord v. Belknap, 1 Cushing, 279; Watchman v. Crooke, 5 Gill and Johnson, 254; Bean v. Atwater, 4 Connecticut, 4; Kettle v. Harvey, 21 Vermont, 301; McClure v. Rush, 9 Dana, 64.)

4. But it may be said, that although performance was a condition precedent to delivery by plaintiff of his notes, yet performance within the time was not so.

a. It is important on this point to distinguish between the question whether non-performance within the time will, because of the agreement being dependent, defeat a recovery or the contract itself, and the question whether, notwithstanding such non-performance, assumpsit will not lie to recover for the labor and materials.

b. It would seem to be the settled rule, both here and in England, that if plaintiff has not performed the work in exact accordance with the contract, and there has been no waiver, he cannot recover on the contract, but must recover, if at all, on the common counts for his labor and materials. (2 Greenleaf's Evidence, secs. 104, 136; Chapel v. Hicks, 2 Crompt and Mee, 214; Read v. Banner, 10 B. and C., 440; Alexander v. Gardner, 10 Bingham N. C., 671; Chater v. Leese, 4 M. and W., 295, 311; Jewell v. Schroepel, 4 Cowen, 564; Ladua v. Seymour, 24 Wendell, 62; Britton v. Turner, 6 N. H., 481.)

c. Unless, therefore, time of performance might, in a declaration on the contract, be wholly omitted, this case falls within the rule, and plaintiff would be remitted to his common counts; that it could not be so omitted, plaintiff in error refers to Phillips v. Rose, 8 Johnson, 393; Jewell v. Schroepel, 4 Cowen, 565; Smith v. Guyarty, 4 Barbour, 615; Ladua v. Seymour, 24 Wendell, 61; Gregory v. Hincks, 3 Hill, 380; Watchman v. Crooke, 5 Gill and Johnson, 254; Farnham v. Ross, 2 Hall, 167.

d. As to to the right of defendant in error to recover on common counts, no discussion is necessary. The ruling excepted to declares the agreements to be independent, and that recovery may be, and it was in fact, had upon the counts on the special contract.

III. But, besides and beyond the artificial rules above adverted to, and under which it is submitted plaintiff in error is safe, there are others, founded on the plainest principles of equity and justice, which have guided, if not controlled, the courts, in their construction of this class of contracts; and it is upon these and their application that the case must turn.

Of these, the principal ones are——

1. Where non-performance by plaintiff deprives the defendant, not of part, but of the entire consideration of the contract, the agreement of defendant shall be deemed dependent. (Pordage v. Cole, 1 Wms. Saunders, 320; Duke St. Albans v. Shore, 1 H. Black, 270; Dakin v. Williams, 11 Wendell, 67; Atkinson v. Smith, 14 M. and W., 695.)

2. Where defendant, in case of plaintiff's non-performance has no other remedy for the injury he sustains except by declaring his agreement dependent. (Pordage v. Cole, 1 Wms. Saunders, 319.)

3. Where the amount of the consideration which defendant will be absolved from paying plaintiff, if his agreement be deemed dependent, is not, or may not be, commensurate with the injury sustained by plaintiff, or, in the language of this court, there 'is no natural connection' between the two; in such case, defendant's contract shall be construed to be independent.

In discussing the application of these principles, plaintiff in error submits at the outset, that almost all the rules of construction in this class of cases are founded upon a struggle of the courts to avoid the old and long-standing doctrines of forfeiture. Thus the rule, that in case of failure to perform, when such failure deprives defendant only of part of the consideration to be received by him, the agreement shall be deemed independent, is founded solely on the ground of forfeiture, and the want of equity in allowing defendant to keep and enjoy the labor and materials of the plaintiff without compensation. So, also, the doctrine, that there is no natural connection between the sum due plaintiff at the...