Case ID: njl_18/html/0467-01.html
Source: Caselaw Access Project
Author: {"author": "Nevius, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

THE BENNINGTON IRON COMPANY v. JOHN RUTHERFORD.
    In debt.- — Demurrer,
    1. To declaration in debt on an assigned bond, a plea that the power to purchase and hold said bond, is not specifically granted to the plaintiff by any charter or act of incorporation, nor does it necessarily result from their proper business, is defective in substance. Whether granted or not, in express words, it exists, unless restrained by ,a prohibitory clause.
    2. A plea bad in part is wholly bad.
    3. A plea, alleging that the assignment of said bond was made in pursuance of a corrupt agreement for the loan of money, by which more than six per cent, interest is reserved, contrary to the statute, is defective, inasmuch as the declaration charges, and the plea admits, by not denying, that the assignment was made at and in the state of New-York, and the statute referred to in the plea, in general terms, is that of New-Jersey. This defect is not supplied by the venue. Wherever the place is material, it should be stated in direct terms.
    
      4. On demurrer to a replication, that it does not allege nor does it appear by the company’s charter that they have any power to take more than a rate of six per cent, per annum ; Held, that it need not so appear. Corporations, as natural persons, may contract for any rate of interest, unless restrained by statute ; and this is a matter of defence, and the power need not be shown by the plaintiff’s pleading.
    5. A rejoinder (to a replication) concluding to the country, and putting in issue to be tried by the country, the existence of a record, viz. an act of incorporation, passed by the legislature of another state, although it is a private act, is bad on demurrer. Such act is to be tried as a record, certified according to act of Congress, and has the same effect in this state, as it has in the state where it was passed.
    6. A plea alleges that the assignment of said bond was made at, &c. in New-Jersey, and in pursuance of a corrupt agreement there made, and denies that it was made at, &c. in New-York — Replication reaffirms the allegation in the declaration, that it was made at, &c. in New-York, and in pursuance of a fair and lawful agreement there made, and not of any agreement made at, &c. in New-Jersey.
    7. A rejoinder that it was not made at, &c. in New-York, in pursuance of a fair and lawful agreement made at that place, does not support, but departs from the plea, and is, therefore, bad.'
    
      Mr. Armstrong for plaintiff.
    
      Mr. W. Rutherford and I. H. Williamson for defendant. '
    STATE OE THE CASE.
    The declaration is in the usual form, upon a bond purporting to be signed by the defendant, dated October 1st, 1836, in the penal sum of $13,588, to' be paid to J. W. Condiet, J. J. Plume and J. P. Pennington, their administrators or assigns. And it avers that, before the payment of said bond, or any part of it, to wit, on the 30th of March, 1837, the obligees, by deed under their hands and seals, assigned and transferred said bond to one Isaac Ogden, who in like manner, before payment, to wit, on the 6th of July, 1837, by deed under his hand and seal, at Waddington, in the county of St. Lawrence, in the state of New-York, to wit, at Newark, &c. assigned the same to the plaintiff, of which assignments the defendant had notice.
    The defendant craved oyer of the bond, and pleaded
    1st. Non est factum.
    
    2d. That the first assignment set forth in the declaration, was not the 'deed of the obligees.
    
      3d. That the second assignment was not the deed of the said Isaac Ogden.
    4th. That the plaintiffs are not a body politic or corporate, and have no right to sue as such.
    5th. That the said plaintiffs were not, on the 6th of July, 1837, and are not a body corporate, competent in law, and of legal capacity to purchase and hold by assignment, the said supposed writing obligatory, and that, therefore, the said supposed assignment by Ogden, is null and void.
    6th. That the power to hold, purchase or deal in, the said writing obligatory, is not specifically granted to said company, by any charter or act of incorporation, nor does it necessarily result from their proper business.
    After craving oyer of the deed of assignment by Ogden to the plaintiffs, which recites that “ the defendant being indebted to the obligees, named in said bond, in the sum of 6,793 dollars and 94 cents," by his bond, dated October 1st, 1836, in the penalty of 13,588 dollars, conditioned for the payment of the first mentioned sum, in two equal payments, at one and two years after the date thereof, with lawful interest, &c., did, in order to secure the payment of said sum, with interest, execute and deliver to said obligees, a mortgage upon certain premises in Newark, New Jersey; and that the said obligees had assigned said bond and mortgage to said Ogden, and sets forth that said Ogden, in consideration of 6,895 dollars and 85 cents, to him paid by the plaintiffs, assigned to them the said bond and mortgage, to be held to their own use and benefit; and constituted the plaintiffs his attorney in his name, but to their use, to collect and recover said moneys by all lawful means, and, when collected, to discharge the same; and covenanted that there was then due, on said bond, 6,793 dollars and 94 cents, with interest from the date, and for the due and faithful payment of the said sum and interest, on or before the 1st of October, 1838, and also for the payment at that time, of the further interest of one per cent, per annum, on the said principal sutn, to be computed from the 1st day of July, 1837, till the time of payment, so as to make the interest seven per cent per annum, from that day.” Which said deed of assignment being read, the defendant further pleaded.
    7th. That before the said last mentioned assignment was made, to wit, on the 1st day of July, 1837, at Newark, in the county of Essex, it was corruptly, and against the form of the statute in such case provided, agreed between the plaintiffs and the said Ogden, that they should lend him 6,895 dollars and 85 cents, and that they should forbear and give day of payment thereof until the first day of October, 1838, and that the said Ogden, for the said loan and forbearance, for the time aforesaid, should give to the said plaintiffs 203 dollars and 82 cents, part of the interest then due on the principal sum of 6,793 dollars and 94 cents, in the condition of said bond mentioned, and also contract to pay them the further sum of one per cent, per annum from the 1st of July, aforesaid, till the day of payment; and should assign said bond and mortgage in the said supposed assignment mentioned, to the said plaintiffs, and appoint said plaintiffs his attorney, and co.venant that there was due on said bond 6,793 dollars and 94 cents, with interest from the date thereof, and for the faithful payment of said sum, with interest, on the first of October, 1838, and the further interest of one per cent, per annum on said principal sum, from the 1st of July, 1837, till the time of payment, so as to make the rate of interest from that day seven per cent.
    That in pursuance of the said corrupt agreement, the plaintiffs, on the 6th of July, 1837, at Newark, in the county of Essex, lent said Ogden said sum of 6,895 dollars and 85 cents, and to secure the repayment thereof, on the 1st of October, 1838, with the said sum of 203 dollars and 82 cents, part of the interest on 6,793 dollars and 94 cents, and also the one per cent, per annum on said principal sum, from the 1st of July, 1837, till the time of payment, as aforesaid, the said Ogden, in further pursuance of said corrupt agreement, then and there made and sealed said assignment, and the said plaintiffs accepted the same, in pursuance of said corrupt agreement, and for the purpose aforesaid ; and he avers that the said sum of 6,793 dollars and 94 cents, bears interest at the rate of six per cent, per annum from the date of said bond, and by the supposed assignment, there was reserved on the loan of 6,895 dollars and 85 cents, an amount of interest exceeding six per cent, for forbearance, contrary to the form of the statute, &c.; by means whereof, the said assignment is void in law. And the plea then traverses that the said assignment was made at Waddington, in the state of New-York.
    8th. That the said assignment was made in pursuance of a corrupt agreement for the loan of 6,895 dollars and 85 cents, whereby there was reserved more than six per cent, interest per annum, to wit, above six and a half per cent, for the forbearance and giving time of payment, contrary to the form of the statute, &c.; by means whereof, the said deed of assignment is utterly void, &c.
    9th. That before the making of said deed of assignment, it was, corruptly and against the statute, agreed that the plaintiffs should lend said Ogden the said sum of 6,895 dollars and 85 cents, and forbear and give time of payment till the 1st of October, 1838, and for such forbearance it was further corruptly agreed between the said plaintiffs and the said Ogden, as is contained in the said supposed deed of assignment, as set forth in the seventh plea as above pleaded, and that afterwards, to wit, on the 6th day of July, 1837, the said assignment was made and delivered by the said Ogden to the said plaintiffs, and accepted by them in pursuance of said corrupt agreement; whereby was reserved more than six per cent, per annum for such forbearance, &c.; by means, &e. said assignment is void in law. Wherefore, &c.
    10th. That by an act of the state of New-York, the rate of interest is fixed at seven per cent., and that all bonds and contracts, whereby a greater rate of interest is reserved, are void; and that - the said assignment was made and accepted in pursuance of a corrupt agreement made at Waddington, in the state of New-York, whereby there was reserved to the said plaintiffs, a greater rate of interest than seven per cent, on said loan, contrary to the form of that statute; by means whereof, said assignment is utterly void. Wherefore, &c.
    To the first, second and third pleas, the plaintiffs joined issue.
    To the fourth, they reply predudi non, because, they say, that by a law of the state of Vermont entitled “ an act incorporating the Bennington iron company,” passed, &c. according to the constitution and laws of said state, as by the record of said law in the Secretary’s office, at Montpelier, in said state, will more fully appear, the said plaintiffs became, and still are, a body corporate, by the name of “ The Bennington Iron Company,” and by that name may sue and be sued, &c. purchase, hold and convey real and personal estate, not exceeding 500,000 dollars, &c. That the said plaintiffs are the same body politic and corporate mentioned in said act, &c.; all which, &c. Wherefore, &c.
    To the fifth, they reply, that on the 6th day of July, 1837, they were, and ever since have been, a body.corporate, competent in law to purchase and hold by assignment, the said bond, in the said declaration mentioned.
    To the sixth, they reply, that true it is, the power to purchase and deal in the said writing obligatory, is not specifically granted to them by their charter, yet that.the said Ogden, on the 6th day of July, 1837, being lawfully, indebted to them in the sum of 6,895 dollars and 85 cents, in the course of their proper business, to secure the payment of the said sum, on the same day sold and assigned the said bond to the said plaintiffs, and they accepted the same for the purpose aforesaid, as, by virtue of their said charter, they had authority to do. Wherefore, &c.
    To the seventh, they reply that the said assignment was made at Waddington, in the state of New-York, in pursuance of a fair and lawful agreement, made between the parties at that place, and not in pursuance of any agreement made at Newark, or at any other place in New-Jersey. Wherefore, &o.
    To the eighth they reply, that the said deed of assignment was made, delivered and accepted without the state of New-Jersey, to wit, in the state of New-York, and that it was so made and accepted in pursuance of a fair and' lawful agreement made without the limits of New-Jersey, to. wit, in New-York, and not for any other or different agreement or consideration, &o.
    
    To the ninth, that the said assignment was made without the state of New-Jersey, in pursuance of a fair and lawful agreement made without the limits of New-Jersey, and not of any corrupt agreement, &c.
    To the tenth they reply, that although true it is, it was enacted by the legislature of the state of New-York, as in the-said plea is alleged, and that the said deed -of assignment was made in pursuance of an agreement made at Waddington, in the state of Ne w-York, yet they say that the said assignment was made in pursuance of a good and legal consideration, and not of a corrupt and unlawful agreement; and this they pray may be inquired, &c.
    The defendant has joined issue to the replications to the fifth and tenth pleas; to the replication to the fourth plea he rejoins as follows:
    
      Actio non, that there is not any such record remaining in the said office of the Secretary of the State of Vermont, at Montpelier, as the plaintiffs have alleged; and of this he puts himself upon the country.
    To the replication to the seventh plea,
    lie rejoins, that the said assignment was not made at Wadding-ton, in the state of New-York, in pursuance of a lawful agreement between the parties there made, as the plaintiffs have alleged, and of this he puts himself, &c.
    
    To the replication to the sixth plea he demurs, and assigns the following causes :
    1st. Because it is not alleged, nor does it appear by said replication, that the plaintiffs purchased and held the said bond and accepted the said assignment, in satisfaction of the debt alleged to be due them from the said Ogden.
    2d. That it appears by said replication, that the said Ogden, for the purpose of securing the payment of the debt alleged to be due said plaintiffs, did assign said bond ; and it is not averred, in said replication, nor does it appear by the act of incorporation, set forth in their replication to the fourth plea of said defendant, that they have any power to purchase and hold the said bond by assignment, for the purpose alleged -in said replication.
    To the replication to the eighth plea, he demurs for the following causes:
    1st. That the plaintiffs do not deny, but admit, that the said assignment was made in pursuance of a corrupt agreement, whereby there was reserved, for loan and forbearance, of said sum of 6,895 dollars and 85 cents, above the rate of six per cent., to wit, at the rate of six and a half per cent, per annum, on said loan contrary to the form of the statute, &c.
    2d. That the said plaintiffs have admitted the usury in the said eighth plea set forth, but have alleged that the said supposed assignment was made and accepted out of the state, in pursuance of an agreement made out of the state, which is no sufficient answer in law to said plea.
    
      To the replication to the ninth plea, he demurs for these causes, to wit:
    1st. That it appears, by said replication, that the said assignment was made and accepted in pursuance of an agreement made out of the state of New-Jersey, without denying that the assignment was made within the state of New-Jersey.
    2d. That the agreement, in pursuance of which the said assignment was made, was made out of the state of New-Jersey, without setting forth in what place it was made.
    3d. That it is not alleged, in said replication, nor does it appear by said act of incorporation, that the plaintiffs have any power to take a rate of interest beyond six per cent, per annum, for the loan and forbearance of said sum of 6,895 dollars and 85 cents, as is alleged-in said plea. And
    4th. That the said replication alleges the said agreement was made out of the state of New-Jersey, which is no sufficient answer in law to said plea.
    To these several demurrers, the plaintiffs have filed their joinder.
    And to the defendant’s rejoinder to the replication to the fourth plea they demur, for this cause, to wit:
    That said rejoinder attempts to put in issue to be tried by -the country, the existence of the record therein mentioned, which cannot be tried by the country, and it illegally concludes to the country.
    And to the rejoinder to replication to the seventh plea, they demur for this cause:
    That it attempts to set up other and different matters of defence. That it does not support the plea, and attempts to narrow and confine the matter in issue; that it does not answer the whole of the replication, nor put in issue the material matters in said plea, alleged and denied, and traversed by said replication ; that it attempts to form an immaterial issue.
    And to these demurrers the defendant has filed his joinder.
   Nevius, J.

The case, as above stated, exhibits a brief, but a substantial and true history of the pleadings filed by the parties to this suit. The first questions presented for the consideration and decision of the court, arise upon the defendant’s demurrers to the replication to the sixth, eighth, and ninth pleas. The sixth plea alleges that the power to purchase and hold the said writing obligatory, is not specifically granted to the plaintiffs by any charter or act of incorporation, nor does it necessarily result from their proper business. The plaintiffs, in their reply, say, that although such power is not specifically granted by the express terms of their charter, yet that Ogden became lawfully indebted to them in the course of their proper business, and to secure that debt, assigned said bond to them, which they accepted, as, by virtue of their charter, they had authority to do. The defendant objects to this replication, that the plaintiffs do not therein aver that they accepted said assignment in satisfaction of their said debt, and secondly, that it is not averred, nor does it appear from the act of incorporation, set forth in their fourth replication, that the plaintiffs have power to purchase and hold said bond by assignment.

Before examining these objections to the plaintiffs’ replication, it is proper to examine the plea itself, for if that is defective in substance, judgment on this demurrer must be rendered for the plaintiffs. I think the plea defective in substance, and that it is no answer to the declaration to say, that the act of incorporation of the plaintiffs does not grant them the specific power to purchase or deal in this particular bond, or that such power does not necessarily result from their proper business. If the plaintiffs have no such power, this would have been a good defence under the general issue, and that which may be given in evidence under that issue, ought not to be specially pleaded. But again, this plea denies a general power in the plaintiffs, which is incident to such a corporation, by alleging that it is not specifically granted to them. "Whether granted or not, in direct and express words, it nevertheless exists, unless restrained by the terms of the charter, either by a prohibitory clause relating to all bonds, or to this bond in particular. To purchase and hold lands and chattels for the general purposes of an incorporation, is a right and power annexed to all corporations, where, for such purposes, it is either necessary or proper to exercise it. But if it is insisted that the latter part of this plea is good, to wit, that the power to purchase this bond did not necessarily result from their proper business, it may be answered that the plea being bad in part, it connot be sustained; for a plea, being entire, must be wholly good or wholly bad.

But if this plea were good in law, it is a good reply to it to say, that the debt of Ogden was contracted to the plaintiffs in the course of their proper business, and the assignment was made to secure that debt, as, by virtue of their charter, it was competent and lawful for them to do. If the plaintiffs, as a corporation, have the power to enter into contracts in the course of their ordinary and proper bnsiness,.and such power will not be denied, it will follow that they have the right to enforce and carry such contracts into effect, by their voluntary receipt of payment, and by consequence, to take such security for the payment as they may deem expedient, whether by original bond or note, of their debtors, or by the transfer and delivery of the bond or note of a third person, unless especially restrained by the terms of their charter, from doing so. Upon this demurrer I am of opinion that judgment should be for the plaintiffs.

The eighth plea of the defendant alleges that the assignment was made in pursuance of a corrupt agreement for the loan of money, whereby there was reserved more than six per cent, interest, contrary to the statute. The replication is, that the assignment was made and accepted out of the state .of. New-Jersey, to wit, in the state of New-York, and in pursuance of a fair and lawful agreement made out of New-Jersey, to wit, in New-York, and not for any other agreement. If this plea is bad in substance, the like judgment must be given on this demurrer, whether the replication is good or not. Does this plea answer the decíaration ? or is it in any other respect defective in substance ? The declaration charges that the said Isaac Ogden, on the 6th of July, 1837, at Waddington, in the county, of St. Lawrence, in the state of New-York, by deed, &c. assigned said bond, &c. The plea alleges that it was made in pursuance of a corrupt agreement, and contrary to the form of the statute. .Now the law will imply that where a statute is referred to in general terms in a plea, that the statute intended is the statute of the state where it is pleaded, as in this case the statute of New-Jersey. The plea should, therefore, have averred that the assignment was made pursuant to an agreement made in New-Jersey, which would be affected by the provisions of such statute.....If the agreement was made out of Yew-Jersey, it could not be said to be contrary to the form of the statute of Yew-Jersey, in such case provided. The plea admits that the assignment was made in Yew- York, because it does not deny that allegation in the declaration, and if pursuant to a corrupt agreement, the legal presumption is, that it was also made there, or, if not, it should have been so averred in the plea. It is no answer to say that this defect is supplied by the venue. For the declaration contains a positive averment that the assignment was made in Yew-York, and the plea should have averred that it was in pursuance of an agreement made in Yew-Jersey, if the defendant intended to insist upon that fact. Wherever the place is material, it should be stated in direct terms, and not be left to be referred to the venue. In this respect, the plea is defective in substance.

But if we were to overlook this objection to the plea, I find no ground to sustain the demurrer to the replication. In that, there is no admission that the assignment was made on a corrupt agreement; on the contrary, it is therein re-affirmed, that it was made out of the state of Yew-Jersey, and averred to have been in pursuance of a fair and lawful agreement, and not in pursuance of any other agreement. This is a denial of every material fact alleged in the plea. It was not necessary to state the place where the agreement was made, but it was sufficient to state, that it was a lawful agreement, and out of the operation of the statute of Yew-Jersey. Judgment should, therefore, be entered for the plaintiffs on this demurrer.

The first, second and fourth causes of demurrer, assigned to the replication to the ninth plea, may be considered as already answered. The same remarks made as to the validity of the replication to the eighth plea, are applicable to these.

The third cause assigned, is, that it is not alleged, nor does it appear by the act of incorporation, that the plaintiffs have right to take interest at a rate above six per cent, per annum. It need not so appear. Corporations, as natural persons, may contract for any rate of interest, unless restrained by statute; and this is a matter of defence, and the power need not be shown by the plaintiffs’ pleading. This demurrer is also well taken, and judgment must be entered for the plaintiffs.

I come now to the consideration of the demurrer taken to the rejoinder to the replication to the fourth plea. By this demurrer, it is objected that it concludes to the country, and puts in issue, to be tried by the country, the existence of a record. The general rule certainly is, that a record is to be proved by inspection, or per se. What is a record ? Records are said to be acts of Parliament and decrees or judgments of courts of justice. But acts of parliament, or of the legislatures of foreign states, are not such records as come within this general rule of the common law. They are to be otherwise proved. And the defendant accordingly insists here, that a statute of another state, and especially a private statute, is to be proved as a fact, and tried by the country. That all statutes which the court cannot judicially notice, even a private statute of our own state, must be proved as a fact and not as a record. This is not true to the extent urged, even at common law, for a private statute of New-Jersey, in the courts of New-Jersey, must be proved as a record, and not by a witness who has compared the copy. But the constitution of the United States and the act of Congress have settled the law on the subject of records of ioreign states, and changed the common law rule. By the former, full faith and credit is to be given in each state, to the public acts, records,” and judicial proceedings of every other state, and Congress may, by general law, prescribe the manner in which such acts and records shall be proved. The act of Congress, passed in 1790, provides that the acts of the legislatures of the several states, shall be'authenticated by having the seals of their respective states affixed to them. But it is said this is a private statute, and not subject to the provisions of the foregoing article of the constitution, and act of Congress, and cannot, therefore, be proved as a record. That even if it were a statute of our own state, it must be proved as a matter of fact and tried by jury. This is not so. Private as well as public statutes, are the laws of the legislatures by which they are passed, and if proof of them is necessary, it is proof to the court, and must be as records. The only difference between them is, that in the state in which they are passed, public acts require no proof, for they are presumed to be within the knowledge of the court, whilst private acts are to be proved, but they are to be proved as records, and when authenticated under the seal of the state in which they are passed, are to be received and treated as records in the courts of such state. This is the rule of the common law, and not affected by the constitution, or act of Congress above cited; they apply only to statutes of other states, and make no distinction as to the mode of proof between public and private statutes. They are all records, and when authenticated under the great seal of the state in which they are passed, become entitled to full faith and credit in any other state. 1 Wash. C. C. It. 369, and the cases there cited in note. That is, if the act of incorporation in this case is evidence per se, in the state in which it passed, the act of Congress provides that when properly authenticated, it shall have the same faith and credit given to it here. If there it would have the effect of record evidence, so must it here. 3 Sto. Com. on Con. 183. That, in the state of Vermont, this act would have the effect of a record, cannot, I think, be doubted, and, consequently, it must be here esteemed as a record. The conclusion to this rejoinder I think wrong, and the demurrer well taken.

The last question presented by these pleadings, arises on the demurrer to the rejoinder to the replication to the seventh plea. The causes assigned are, that it attempts to set up other matter of defence, and does not support the plea, narrows and confines the issue, and does not answer the whole replication, nor put in issue the material matters alleged in the plea, and denied and traversed by the replication.

The plea alleges, that the assignment to the plaintiff was made at Newark, in the State of New Jersey, and in pursuance of a corrupt agreement there made; and denies that it was made at Waddington.

The replication reaffirms the allegation in the declaration, that it was made at Waddington, in New York, and in pursuance of a fair and lawful agreement there made; and not of any agreement made at Newark or any other place in the state of New Jersey.

The rejoinder is, that it was not made at Waddington in pursuance of a fair and lawful agreement made at that place.

The defence set up iu the plea is, that the assignment was made in New Jersey, pursuant to a corrupt agreement there made, whilst the rejoinder is, that it was not made in New York pursuant to a fair agreement there made. A rejoinder is subject to the same rules that govern pleas, with this addition, that, it must support and not depart from the plea. Here this rule is violated ; and for this cause, the rejoinder is bad. Without examining the other causes, I am of opinion, that this demurrer should be sustained. '

Let judgment be entered for the plaintiffs on all the demurrers.

The whole court agree to the above opinion, except Mr. Justice Whitehead, who did not hear the argument. Elmer, Justice, was absent, when it was delivered.

Judgment for plaintiffs, on all the demurrers.

Cited in Dolman v. Cook, 1 McCar. 62; Campion v. Kille, 1 McCar. 231.