Rose v. Wallace
| Decision Date | 23 November 1858 |
| Citation | 11 Ind. 93 |
| Parties | Rose v. Wallace |
| Court | Indiana Supreme Court |
From the Laporte Circuit Court.
The judgment is reversed. Cause remanded.
A. L Osborn, for appellant.
Mr Osborn cited the following authorities:
The demurrer to the fourth paragraph of the answer should have been overruled. It was not such as the statute contemplates. Lane v. State, 7 Ind. 427.
Recoupment will be allowed whenever an action for damages can be sustained, and circuity of action thus avoided. Houston v. Young, 7 Ind. 200.
Mr Niles, in his brief, cited authorities to the following points:
It will be noticed that no fraud, on the part of the payees of the note, is alleged, and consequently none will be presumed. This counterclaim pleaded as a defense, amounts, then, simply to this, that the sellers of the sheep honestly believed and represented them to be sound, when they were not, and that the defendant suffered damage by allowing them to run with his other sheep. The question now is not whether this representation was a warranty of the sheep, and whether the defendant may be entitled to have a part or the whole of the price deducted on account of a failure of a warranty, but whether he is entitled to recover damages done to his other sheep, by his own act of allowing these to run with them. It is, indeed, stated that the defendant, when he purchased the sheep, was desirous of allowing them to run with his other flock, but it is not shown that the spreading of the disease among them was a necessary consequence, or one which might not have been avoided by reasonable and ordinary care, and the defendant shall not be allowed to recover damages for an injury to which, for aught that he shows, his own negligence may have contributed. Wright v. Brown, 4 Ind 95.--Brownell v. Flagler, 5 Hill 282.--Bush v. Brainard, 1 Cow. 78. 2 Kent's Comm. 282, note 1.
This is not like the case of an article bought for a specific purpose and warranted to be fit for that purpose; for the defendant does not show that there was any pecuniary value attached to the privilege of letting the sheep run with his other flock. Were fraud alleged, a different question might arise. Damages will not, in general, be given for the consequences of wrong-doing or of the failure of a warranty, which are not the natural consequences; because it is only for such that a party is liable. 2 Parsons on Contracts, p. 454, and note.
The damages claimed are too remote to be the proper subject of a counterclaim, even if otherwise recoverable. See Voorhies' N. Y. Code, p. 166, and authorities there cited.
According to the second paragraph of the reply, the defendant owes, on his purchase of the sheep, fully the amount of the note sued on, and for which this judgment is rendered; and the question in effect is, on which of the notes ought he to pay it--on that which has been assigned, and on which the suit is brought, or, so far as is necessary to pay it, on that which is still held by the payee, and the balance on the note in suit. In other words, were the money justly due, brought into Court under a bill of interpleader, to which of the parties Wallace, or Norman Lewis & Co., would the Court direct that the money be paid? Clearly, to Wallace. The right of a party to direct the application of payments does not apply to payments made ad invitum, or by compulsion of legal process. Blackstone Bank v. Hill, 10 Pick. 129.--United States v. January, 7 Cranch 572. And where the application of a payment devolves on the Court, they will make such application as is reasonable and equitable. 1 Am. Lead. Cases, p. 147, and note. That the application of the money due, on this note, would be more just than to apply it on the other, is too plain for argument.
The third paragraph of the reply amounts to what is often called an equitable estoppel. Rose having induced Wallace to part with his money, in reliance on his representations, will not now be permitted to set up this defense as against him. To rule otherwise would be to open the door to frauds, and to reverse the whole doctrine in regard to equitable estoppels. See Sugden on Vendors, Brookfield ed., from 9th Lond. ed., vol. 1, p. 10; vol. 2, p. 263; Gatling v. Rodman, 6 Ind. 289. Laney v. Laney, 4 Ind. 149.
In his petition for a rehearing, Mr. Niles referred to the following authorities:
Were both notes yet held by the payees, Cox v. Reynolds, 7 Ind. 260, might be applicable; but this case is governed by different principles. This may be illustrated by the doctrine relative to the application of payments. The civil law applied payments so as most to favor the debtor, and this was held to be the doctrine of the common law in Pattison v. Heath, 9 Com. 747; but that case is entirely exploded, and, on the contrary, when the application of a payment devolves upon the Court, it will be applied upon the debt which is least secured.--Howard v. Thompson, 21 Wend. 320, 1 Am. Lead. Cas. 151.--Id. 283, new edition. In some cases the rule is altogether discretionary, proceeding upon the justice of the particular case, in view of all the circumstances attending it. Ibid. It is not inequitable, when one debt is well secured and another is not, that a payment be applied to that which is most precarious. Ibid.--Field v. Holland, 6 Cranch 8. When the application of payments is made by the Court, it will act according to its own ideas of justice. Story, J., in U. S. v. Kirkpatrick, 9 Wheat. 720. When a debtor is indebted on bond and on judgment, and sells his land, and the purchaser of the land makes a payment, the law will apply it to the judgment debt, in exoneration of the land. Gwinn v. Whitaker, 1 Har. and J. 754. Again, when a judgment-creditor has a right upon two funds, and another upon one only of them, the former may be compelled to apply first to the fund which cannot be reached by the second judgment. Story's Eq. Juris. § 633. "When there is a lien upon different parcels of land for the payment of the same debt, and some of the lands still belong to the person who in equity owes or ought to pay the debt, and other parcels of the land have been transferred by him to third persons, his part of the land, as between himself and them, shall be primarily chargeable with the debt." Id. § 1233.--Cohen v. Hannegan, 2 Ind. 379.--Russell v. Houston, 5 Ind. 180.
Fraud should be charged in the most direct and unmistakable manner. Otherwise, the rule, secundum allegata et probata, does not hold good. See 2 Chit. Pl. 679 to 710, 12th ed., and the standard forms passim, and compare with the pleadings in this case. "As it is an...
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