Scott Shreeve

• Decision Date: 20 January 1827
• Citation: 6 L.Ed. 744,25 U.S. 605,12 Wheat. 605
• Parties: SCOTT and Others, Appellants, against SHREEVE and Others, Respondents
• Court: U.S. Supreme Court

25 U.S. 605

6 L.Ed. 744

12 Wheat. 605

SCOTT and Others, Appellants, against SHREEVE and

Others, Respondents.

January 20, 1827

Jan. 13th.

THIS cause was argued by Mr. Swann, for the appellants, and by Mr. Taylor, for the respondents.

Jan. 20th.

Mr. Justice THOMPSON delivered the opinion of the Court.

This case comes up by appeal from the Circuit Court of the District of Columbia for the county of Alexandria. The object of the bill filed in the Court below, was to obtain relief against a judgment at law recovered against Shreeve, the appellee, upon certain bonds given by him to Elisha Janney, and which bonds had been assigned to tha appellant. Scott, as his trustee, for the benefit of his creditors.

In the progress of the cause, it was deemed necessary by the Court, that the Bank of Potomack should be made a party defendant. A supplemental bill for the purpose was accordingly filed, and the bank made a party.

The first inquiry that seems naturally to arise is, how the case stood as between Shreeve and Janney, the original parties to the bonds. The material facts upon which which the complainant in the Court below relied for relief, are not denied by the answer of Scott. From the bill and answer, and exhibits in the cause, accompanied by a written agreement between the solicitors of the parties, before the cause was set down for argument, the leading facts in the case appear to be, that some time in the year 1808, Shreeve failed in business, being indebted to the Bank of Potomack in the sum of 6,300 dollars, upon a note disconoted at the hank and upon which Janney was the endorser; for whose security Shreeve transferred to him, and John Roberts, who was also his endorser upon other notes, certain property at a valuation, but which, upon settlement of accounts between them, fell short of Janney's responsibility to the bank upon his endorsement, 1,980 dollars 88 cents; for which, by agreement between the parties, Shreeve gave to Janney five bonds, payable in five annual instalments, and Janney was to pay the note to the bank, upon which he was the endorser. The note, however, was continued running in the bank in its original form, Janney appearing responsible as endorser only. This note was renewed from time to time until the 19th of May, 1809, when, by the payments which had been made by Janney out of the property assigned by Shreeve, it was reduced to the sum of 3,306 dollars; and Janney himself having failed about this time, no further payments were made upon this note until the month of June, 1818, when Shreeve, after a long absence, returned to Alexandria, and was called upon by the bank for payment of his note, upon which he paid the sum of 3,355 dollars 29 cents, being the amount of principal and interest due upon the five bonds which he had given to Janney.

Upon this brief statement of the facts as between Shreeve and Janney, it will be seen, that Shreeve was exposed to a double responsibility for the same debt. He was liable on his note held by the bank, (unless the bank may be considered as having assented to the arrangement, and accepted Janney as solely responsible on the note, which will be hereafter considered,) and he was also liable to Janney on the bonds which he had given him. For the purpose of indemnifying Shreeve against his responsibility to the bank, Janney gave him the instrument bearing date the 1st of March, 1809, acknowledging that Shreeve had satisfied him by his bonds of the 28th of February, 1809, for all demands against him as security at bank, and for all other accounts; and that the note above referred to, although originally discounted for the use of Shreeve, was continued in his name, but for the convenience of him, Janney, and engaging to save Shreeve harmless from the said note, and in due time to take it up.

An objection is here made to sustaining this bill in equity, because there was a complete and adequate remedy at law. But this objection cannot be sustained. The bonds given by Shreeve to Janney were simply for the payment of money, and although the consideration for which they were given had failed by Janney's neglect to pay up the note in the Bank of Potomack according to his engagement, this could not have been set up at law as a defence in the suit upon the bonds; nor could he in that suit, have set off the amount paid to the bank upon his note. The engagement of Janney, on assuming the payment of the note to the bank, was a contract of indemnity only, and rested in damages, and could never form the subject of a set-off at law; and although an action at law might be maintained against Janney upon this indemnity, it would be going too far, even if Janney was solvent, to say, that a Court of equity could not interpose and stay a recovery upon the bonds, but that the party must be turned round to his remedy at law upon his indemnity. But, in the present case, it would be gross injustice, and a certain denial of all remedy, to refuse relief on this ground, Janney having become insolvent. There was, then, no defence at law which...