Case ID: cai_2/html/0117-01.html
Source: Caselaw Access Project
Author: {"author": "SPENCEB, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Roget against Merrit and Clapp.
    On an agreement to accept notes in payment of goods sold, if before delivery the notes turn out bad, a tender and refusal of them is mr payment, uniese the vendor agreed to run the risk of their being paid.
    This was an action for not delivering 220 barrels of flour, according to agreement. On the trial the following appeared to be the circumstances of the case:
    The plaintiff, through the intervention of a broker, known to be acting for him, about the 18th of January, 1800, asked the defendants if they would sell the above quantity of flour for the note of Joseph Lyon. They replied, they would give an answer if he would call the next day. He called, and produced a note of Lyon’s for two thousand two hundred and fifty dollars, drawn in favor of one John Palmer, and endorsed by him in blank. At the same time the agreement was made by the defendants *to sell, and a memorandum of the sale given to the broker, in this form:
    “ 220 barls. S. Flour,
    !< $10 — $2,200'-For Lyon’s note,
    “ 1 mo. 18th, 1800, “ Merritt & Clapp.” '
    "When this was done, it was understood that the difference between the note and the value of the flour should be paid by the defendants, but the note was not delivered over to them. Shortly after they met the broker, and asked him why he did not take away the flour; to which he replied, the plaintiff was not yet ready for it. In a few days the broker called on the defendants, and demanded the flour, tendering the note at the same time. The defendants, however, refused to deliver it, alleging, as a reason, that the maker had failed the day before. When the note was thus tendered, whether it was endorsed or not by the plaintiff, did not appear, though at the time of trial his name was on it, but in a great measure obliterated.
    The declaration contained three counts. The first, on a special agreement, made on the 18th of January, 1800, to deliver 220 barrels of superfine flour, at 10 dollars per barrel, to be paid for in a note of one Joseph Lyon, bearing date the 7th of November, 1799, payable five months after date, with an averment of a tender and refusal, on the 30th of January, 1800. The. second count, on a sale of 220 barrels, &e. to be paid for in a similar' note, in consideration of which sale, and a promise of the plaintiff to pay in such a note, the defendants promised to deliver, with an averment of a tender and refusal. The third count on a sale by the defendants to the plaintiff of 220 barrels of superfine flour, at ten dollars per barrel, with an averment of an .offer to pay, demand and refusal.
    The general issue being pleaded to all the counts, a verdict was taken for the plaintiff by consent, subject to the opinion of the court, whether it should stand or a nonsuit be entered.
    Hamilton, for the plaintiff.
    Whenever a specific thing is to be exchanged for another thing, after the agreement is completed, the article, that is, as it were, the price of the purchase, is at the risk of the vendor, and the goods sold at that of the vendee. This is a principle both in *the Roman and our law. Just. lib. 3, tit. 24, s. 3, fob 78; 2 Bl. Comm. 446; 449. Exchange is where one thing is to be commuted for another, and such was the case here: a note was to be given for the flour, not money to be paid; therefore, the loss from the note's proving bad to be borne by the defendants.
    
      Piker and Harison, contra.
    The principles relied on do not apply. The plaintiff cannot recover on either of his counts. The first and second are not maintained by the evidence. The first is on an agreement to pay a certain specific note of the precise sum; the written agreement or memorandum refers to no such note. The second can as little be maintained; it states the sale to be for a similar note: the evidence as, that it was to be paid for in one of 2,250 dollars, and the difference to be paid by the defendants. In Penng v. Porter, 2 East, 2, the court of king’s bench held that a contract to deliver 40 or 50 bushels of wheat, at the option of the plaintiff, must be declared on in the alternative, and not as an absolute contract, though the plaintiff had elected to deliver only forty. That case, and those to which it refers, establish the evidence in this to be fatally variant. On the third count there can be no recovery, for there was not a particle of evidence in its support. Besides these objections, the contract is void under the statute of frauds, for the memorandum or agreement was signed only by one party, and therefore, though obligatory on them, could not be enforced against the plaintiffs: this renders the whole a mere nudum pactum. The cases on stock contracts evince this; for though one may sign, obliging himself to sell, that, without a counter instrument binding the other to accept, creates no bargain. In addition to the authority from East, we rely on the anonymous case from 1 Lord Kaym. 735, and the references there made.
    Hamilton, in reply.
    The only object of the statute of frauds was to afford written evidence of a contract. Both from the words and the principle of the act, it is unnecessary both parties should execute. If one sign and deliverer over, it is enough ; especially when the person to part with the principal thing, the subject matter of sale, is he who signs. It has been decided, that the mentioning in a letter that a party had agreed to do a thing, is a '^sufficient signing within the statute, though there was no specification of what was to be done. Yin. Abr. tit. Agreement. Therefore, any note or memorandum is sufficient to take it out of the statute. A signature alone will Bot, without consideration, create a contract, it is true; but if a contract is disclosed by the signature, then the consideration may be shown — here it appears. Though a special agreement must be strictly proved, yet that strictness is not a literal strictness, but only as to essential circumstances.
    
      
      
        Queen, whether the delivery would have altered the case, without an actual agreement to take the chance of payment. See 7 D. & E. 65, the words of Lord Kenyon.
    
    
      
      
         Where a sale of goods is made at a certain credit, to be then paid for in a bill at a certain date, and no particular bill is specified, it means a bill accepted by the vendee; therefore, in an action by a vendor for not giving a bill in pursuance of such a sale, the plaintiff must prove that he drew a bill on the defendant, who refused to accept, and the circumstance that the defendant was insolvent and had dishonored his acceptances is not a dispensation to the plaintiff. Reed v. Mestaer, 2 Com. on Cont. 229.
    
    
      
      
         A note, bill or draft, which turns out to be unproductive, if given ic payment, may be treated as a mere nullity. Packford v. Maxwell, 6 D. & E. 52; Owenson v. Morse, 7 D. & E. 64.
    
    
      
       The -words are, “ made and signed by the parties.”
    
    
      
       See Clark v. Wright, 1 Atk. 12, contra, and the authorities there.
    
   SPENCEB, J.

delivered the opinion of the court. On the part of the defendants, two objections were raised to the plaintiffs recovery: 1. That in.neither of the counts is the contract set forth correspondent to the proof, and that therefore there is a fatal variance; 2. That the contract between the parties is a nudum pactum and within the statute of frauds and perjuries. The opinion I am about to give not being founded on either of the objections taken, it will be unnecessary to enter into a minute examination of them. To support the first exception, the defendants’ counsel rely on that part of the proof, whereby it was agreed that the defendants should pay the difference between the flour and note. This undoubtedly was an essential part of the contract, and, according to the rules of pleading, ought to have been stated. The second exception appears to me untenable, and the true answer was given to it by the plaintiff’s counsel: tbe statute of frauds requires, m certain contracts, a memorandum to be signed by the parties to be charged; if there are acts to be done by both parties, and the one who is to perform a principal part (as here the delivery of the flour, sign, and it is accepted by the other party, there can exist no doubt but that such contract would be mutually obligatory. In this case, I hold that there was a valid contract, executory in its nature ; but before the period of its execution arrived, the consideration agreed to be given by the plaintiff wholly failed, by the insolvency of Lyon. The offer by the plaintiff to pay in the note of a bankrupt, was not an offer of payment. In the case of Owenson v. Morse, 7 D. & E. 64, and Puckford v. Maxwell, 6 D. & E. 52, it is recognized as settled law, that upon an agreement to accept notes in payment, if before the delivery of the articles *purchased, the notes turn out not to be good, a tender of them is not to be considered a payment, unless it was part of the agreement to take them as such, and to run the risk of their being paid. It would be highly inequitable for the plaintiff to recover in this action, when the defendants have received no manner of consideration on the contract. We are therefore of opinion, that, on the merits, the defendants are entitled -to judgment.

Judgment of nonsuit. 
      
       The same point was ruled in The People v. Howell, 4 Johns. Rep. 296, and Johnson v. Weed and another, 9 Johns. Rep. 310, and further, that a receipt in full is not a proof of an agreement so to accept them. But though there be such an agreement, if| at the time it be entered into, the vendee give a fraudulent representation of the responsibility of the maker of the note, the vendor may still consider it as a nullity, and proceed on the original contract. Wilson v. Foree, 6 Johns. Rep. 110. The law is the same, though the payment be in bank notes which prove forged, notwithstanding the vendee passed them innocently. Markle v. Hatfield, 2 Johns. Rep. 455. Eor a note is not payment unless duly honored. Even when the above circumstances do not occur, it merely suspends the right of action till due, at which period, if not satisfied, the party may resort to his original cause of aotioB. Putnam v. Lewis, 8 Johns Rep. 389.