Case ID: mass_26/html/0429-01.html
Source: Caselaw Access Project
Author: {"author": "Parker C. .1.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Samuel Knower versus William Emerson.
    The plaintiff, being largely indebted to the defendant, gave him orders on several merchants, to receive from them the balances which they owed the plaintiff for goods consigned to them for sale, and the defendant gave the plaintiff a written contract, in which, after acknowledging the receipt of the orders, and saying that he will pay over to the plaintiff all that he receives, over and above paying his, the defendant’s, demand against the plaintiff, the defendant agrees as follows, — u if there should not be more than 1000 dollars due the plaintiff after paying my demands, I will divide equally the proceeds which I shall receive, on account of the plaintiff, with the plaintiff, and no other; but if there shall be over and above 1000 dollars, the plaintiff can expect no division, as I shall pay all over my demands to him and no other.” A few months afterwards the defendant received the ¡¡alances from the merchants, but they did not amount to enough to pay the defendant’s claim against the plaintiff. In an action on this contract, brought in the plaintiff’s name for the benefit of an assignee, against the defendant, it was held, that the plaintiff was entitled to recover one half of the amount collected by the defendant after de ducting the expenses of collection.
    This was an action of assumpsit, which was submitted to the Court on the following agreed statement of facts.
    Knower, the plaintiff, on October 29th, 1825, being largely indebted to the firms of Emerson & Hastings, Emerson & Jones, and the then late firm of Emerson & Spear, of each of which firms the defendant was a member, gave the defendant a promissory note for $ 4570, payable on demand to Emerson’s order, an amount which the plaintiff was supposed to owe these firms, and took from the defendant a writing dated on that day, *n which he acknowledged the receipt of the note, on account of Emerson & Hastings, Emerson & Jones, and the late firm of Emerson & Spear, and promised to account for it on settlement, or to deliver it up to Knower.
    Before this time Knower had consigned boots and shoes to a large amount to divers commission merchants in New York ; and they had made advances on these consignments.
    At the same time that Knower made the note for $ 4570,. he also gave Emerson orders on all these commission merchants, requesting them to deliver up or pay over to Emerson all the plaintiff’s property in their hands, or the proceeds of it. Emerson then signed and delivered to Knower the following contract:— “ Providence, Oct. 29, 1825. Received of Samuel Knower an order on Spafford & Tileston, &c. for each and every one to accept and deliver up all proceeds due the said S. Knower, and I do hereby agree to pay over to said S. Knower the proceeds of all property which they and each may account to me for, over and above paying these my several demands, viz. a demand of Emerson & Hastings, do. Emerson & Spear, do. Emerson & Jones ; and I do hereby agree, that if there should not be more than one thousand dollars due the said S. Knower after paying my just demands, that I will divide equally the proceeds ivhich I shall receive from the above named firms of New York, on account of said Knower, with the said Knower, and no other. But if there should be over and above one thousand dollars, the said Knower can expect no division of the proceeds, as I shall pay all over my demands to him and no other. — William Emerson. ’ ’
    Emerson, by means of the orders, received from the New York merchants, at different times in 1826, the proceeds of all Knower’s property remaining in their hands, amounting in all to $ 1039-51, the whole of which he indorsed in several sums upon Knower’s notes to Emerson & Spear.
    On October 29th, 1825, when Knower gave his note to Emerson for $ 4570, the whole amount which was due from him to the firms in which Emerson was a partner and to Emerson separately, was $ 3485-90.
    On November 10th, 1825, Knower made a general assign* ment of his property to John Lemist, for the benefit of his creditors. By a provision in this instrument, all the creditors who became parties to it released all their claims against Knower. Emerson was one of the creditors who thus became parties. In this instrument, among the assigned property, are specified the boots and shoes consigned to the New York merchants, which consignments and their proceeds are stated to be “subject to a certain order drawn by said Knower in favor of one William Emerson ; ” and Lemist is appointed attorney of the assignor, and as such, among other things, is authorized to demand and sue for all balances which were due or should become due “ from said merchants in New York and said William Emerson.”
    This action was brought in Knower’s name for the benefit of Lemist, the assignee. The defendant was to be defaulted or the plaintiff to become nonsuit, according to the opinion of the Court upon the foregoing facts. The defendant, if the decision was against him, claimed a deduction of $ 98,50 for expenses and trouble in collecting the money in New York, the right to claim which was also submitted to the Court.
    The case was argued by Morey, for the plaintiff, and S. D. Parker, for the defendant.
   Parker C. .1.

delivered the opinion of the Court. The question in this case turns wholly upon the construction of a written contract, agreement or receipt, whichever it may be called, out of which the right of the plaintiff to recover is supposed to grow. The first part of this paper is plain and intelligible, and can mean nothing else than that the defendant should retain from the proceeds of the demands assigned to him by the order, enough to pay his specified demands and pay over the balance to the owner ; but the other part is apparently inconsistent with this, and is certainly liable to some doubt as to its true construction. Now the whole of this contract must be taken together in order to get at the true intention of the parties ; and if the latter part is irreconcilable with the former upon any reasonable construction, it ought to aid in the construction of the whole, though apparently inconsistent.

Taking the construction offered by the defendant, some extraordinary consequences will follow, which we cannot thins the parties intended, and it would also be directly repugnant to one °f the express provisions in this very member of the contract. The construction suggested is, that if the sum collected should fall short of $ 1000, over the demands of Emerson, this excess should be divided between Emerson and Knower; but that the whole of the demands of Emerson should be paid. This we think is inadmissible, because the effect of it might be to put $ 500, wanting one cent, into the pocket of Emerson, 'without any consideration or apparent motive. It is suggested in support of this construction, that the object was to compensate Emerson for the possible expense and trouble of collecting the debts, but it cannot be imagined, when it was contemplated that sufficient would be collected to pay Emerson, that so improvident a bargain would have been made by Knower ; nor ought we to suppose that so extortionate a one would have been insisted on by Emerson. Besides, this would be in direct contradiction to the words of the contract, which are, that in the event contemplated there should be an equal division of the proceeds received from the merchants in New York, which can mean nothing else than the whole of the proceeds ; otherwise it would have been expressed, that the' excess only should be divided.

The construction proposed by the plaintiff is more conformable to the letter of the contract, and therefore more likely to be according to the intent of the parties, viz. that in case the funds received should fall short of the agreed sum, the whole funds should be equally divided. It is said however, that this; would be absurd, for Emerson, having Knower in some measure in his power, would not be likely to submit to such a disposition of the funds. But it should be recollected, that Emerson had no power over these funds except by the consent of Knower ; that it was a great object with him to obtain what he could get, and that but for this assignment from Knower, nothing could have been got by him. And then as to the motive on the part of Knower, if these funds should yield $ 1C0O after paying Emerson, he might have contemplated that with his other property afterwards assigned to Lemist, he might make a satisfactory arrangement with his other creditors, which he might be unable to do if he had nothing to transfer of his funds in New York ; and that the creditors might be dissatisfied with him if he should have paid the whole of Emerson’s demands, when his assets might turn out to be small for the rest of his creditors. There is nothing unreasonable in this supposition, or in the arrangement with Emerson upon this construction of it. We are satisfied therefore, that although the phraseology of the contract is obscure, the true meaning of it is, that if the funds in New York should yield only so much as would amount to the demands of Emerson and a surplus short of $1000, the whole fund should be equally divided. And there is nothing in the subsequent assignment to Lemist, to which Emerson was also a party, which contradicts this supposition ; for the funds in New York were assigned, subject to the order in favor of Emerson, and this provision would be equally applicable to either supposition as to the character of this contract.

We think, therefore, the plaintiff is entitled to recover, for the use of the creditors to whom he made his general assignment after deducting the reasonable expenses of Emerson.

Defendant defaulted.