Case ID: cole-cai-cas_1/html/0264-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Kent, J. Lewis, C. J. \n      Per Curiam,\n     Lewis, C. J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

The President, Directors and Company of the Union Turnpike Road v. Thomas Jenkins. The same v. the same, in three other actions.
    
    BY an act of the 3d of April, 1801, certain persons were incorporated, for the purpose of improving the road from New-Lebanon to Hudson, under the name of “ The President, Directors, and Company {t of the Union Turnpike Road.”
    
    By the second section of the act, it is ordered,, <£ that Robert Jenkins, and Elisha Williams be, and “ they are hereby appointed commissioners, to do ££ and perform the several duties hereafter mention- <£ ed : that is to say, they shall, on or before the first £C day of May next, procure two books, and in each “ of them enter as follows : We, whose names are ££ hereunto subscribed, do, for ourselves, and our legal “ representatives, promise to pay, to the President, ££ Directors, and Company of the Union Turnpike “ Road, twenty-five dollars, for every share of stock “ in the said company, set opposite to our respective <c names, in such manner and proportion as shall be de- ££ termined by the said President, Directors, and “ Company ; and every subscriber shall, at the time i£ of subscribing, pay unto either of the said com-S£ missioners, the sum of ten dollars, for each share i,£ so subscribed : and the said commissioners, shall$ 
      “ as soon as one thousand shares have been subserib- “ ed, cause an advertisement to be inserted in the “ public news-paper, printed in Hudson, giving at “ least ten days notice of the time and place the said “ subscribers shall meet, for the purpose of choos- “ ing five directors, who shall be stock-holders, for “ the purpose of managing the concerns of the said 16 Company, for one year; and the day of choosing <£ the said directors, shall, thereafter, be the anniver41 sary day of choosing directors ; and the directors “ elected by the votes of the stockholders, shall im- “ mediately proceed to the choice - of one of their li members for President; and the said President and. “ Directors shall and may meet from time to time, at such time and place as they may by their bye-u laws direct, and shall have power to make such ££ bye-laws, rules, orders and regulations, not incont:‘ sistent with the constitution of this or the United <£ States, ■ as shall be necessary for the well ordering i£ of the affairs of the said corporation : Provided, cc that, at the election of the directors, every person “ shall have a number of votes equal to the number “ of shares owned by such person, if such number “ shall not exceed fifty, and one vote for every three “ shares owned by such person exceeding fifty.”
    By the last section, it is enacted, cc That it shall 66 be lawful for the said directors, to call for, and de- “ mand, of and from the stockholders respectively, i£ all such sums of money by them subscribed, or to a be subscribed, at such times and in such proport£ tians, as they shall see fit, under pain of forfeiture £C of their shares, and of all previous payments made 
      ee thereon, to the said President, Directors and Com- ’ ^ “ pony.
    
    The defendant had subscribed for 280 shares, but, at the period of writing his name in the book, as directed by the first section, the 10 dollars therein ordained to be, at that time paid, were neither so paid, nor were demanded. Two orders for paying in 5 dollars on each share subscribed, were made, with which the defendant refused to comply, and for their amount the present actions were brought. The first count in the declaration, stated the passing of the act, and incorporating the company. It also set forth the second section, omitting, however, that part requiring the payment of the 10 dollars on each share at the time of subscription ; it went on averring the compliance with the requisites, of that section, the subscription of the defendant, and of 2,900 shares ; it stated the election of a President and Directors, and two orders made by them for payment of two instalments, of 5 dollars cash, on each share subscribed, notice, and by reason whereof, &c.
    The second count was in these words, “ And Si whereas, also, the said Thomas Jenkins, on the i£ seventh day of April, 1801, at the city of Albany, in the county of Albany, made his certain promissosc ry note in writing, by him, in his own proper hand- “ writing subscribed, the date whereof, is on the <£ same day and year aforesaid ; whereby the said .<c Thomas, promised for himself, and his legal repre- “ sentatives, to pay to the President, Directors and “ Company of the Union Turnpike Road, the sum of *.£ 25 dollars for every share of stock set opposite to his name, in such manner and proportion, and at “ such time and place, as should be determined by s< the said President, Directors and Company, and. “ the said Thomas did then and there set opposite to “ his name, fifty shares,” with an averment of their determining that he should pay 5 dollars on each, on the 10th of September, then next, with notice, liability, and assumption.
    The third count was in the same form on a promissory note, for 230 shares.
    The causes were tried at the Albany circuit, in January last, and general verdicts found for the plaintiffs.
    After this, the defendant gave notice of moving in arrest of judgment, and assigned the following reasons :
    1st. That the first counts in the declarations in the said causes, being founded upon the statute, do not set forth that the said defendant at the time of subscribing the said subscription, paid to the said commissioners, the 10 dollars on each share, by him subscribed, according to the regulations of the said act, and that it appears by the said counts, that the commissioners therein named, did not, as soon as one thousand shares were subscribed, in the manner directed by the said act, proceed to give the notice by the said act required, for the purpose of choosing directors, and that no Qrder and determination of the President, Directors and Company, in the said declarations mentioned, is stated in the said first counts, for the payment of any money, upon the shares of stock, therein mentioned to have been subscribed ; so that the defendant never became liable to pay any such money, and that the promises in the said first counts stated, are void for want of consideration.
    2dly.- That the second and third counts, in the declarations in the said causes, are founded on agreements or promises in writing between the parties, as on a note of hand, which is not within the statute, &c. and that the said counts do not set forth any good or valid consideration, upon which the said agreements in writing were made and given.
    Immediately after service of notice of the above reasons, in arrest of judgment, on an affidavit stating, that the evidence offered at the trial, was under the first counts in the declarations, and calculated to support them in particular (the second and third counts not being read to the jury, nor referred to by the counsel) the plaintiffs gave notice of a motion, to amend the verdicts in the several suits, from the judge’s notes, so as to make them apply only to the first counts in the several declarations, and to enter verdicts on the second and third counts for the defendant, and to amend the postea and rules for judgment entered thereon, in conformity to such order as the court might make.
    Champtin, for the defendant.
    The first objection is, that the ten dollars, ordered by the act to be paid. Was not so done. The contract then, on which the action is founded, is not according to the order of the statute. In the next place, the orders stated by the declaration to have been made for payment of the * " sums demanded, are not in pursuance of the law. By that, the order is to be by the President-, Directors and Company; the declaration sets forth one, by the President and Directors only. This is fatal, for as the plaintiffs have a particular authority, they ought to show a strict literal compliance with the law, by which they are authorised. If they have a right, to omit the company in their orders, they may the directors, and so the president alone may govern the affairs of the corporation. The two last counts are plainly bad : they are on promissory notes, under the statute, where those notes appear to depend on a contingency. The declarations, therefore, on them cannot be .maintained. Carlos v. Fancourt, 5 D. & E. 482. For a note on a contingency is not a note within the statute. Not that such a note cannot be declared on, but then it must be as a special agreement, and the consideration set out. As to the notice to amend, it is before the court; they, perhaps, will not be disposed to allow it. We object, however, that the application is too late, because a term has intervened, and the evidence which was given in one count, would equally apply to all. Yet, if we are wrong in this, if the court should give leave to amend, they will not do it, without ordering at the same time a new trial. Tomlinson v. Blacksmith, 7 D. Sc E. 132.
    
    
      
      Williams and Van Ness, contra.
    The application A A on the part of the defendant, is to amend the verdict from the notes of the judge, so as to apply the evidence to the first count only, and to enter verdicts for the defendant on the second and third. It is evident that the testimony could have gone only to the first, for the two last are stated simply as contracts, though the form be somewhat like that on a note of hand.— They were engagements to an organized company, and it was only in relation to that company, that they were taken; they must, therefore, comport with the defendant’s liability to that company, under the first count. When a general verdict is given, it is almost of course to amend, if that verdict does not correspond with the judge’s notes. 3 D. & E. 659. So in Eddowes v. Hopkins, it was ruled, that if the evidence be only on a good or consistent count, and v . ° . • . there be others bad m point of law, a general verdict given on the whole declaration, shall be amended according to the judge’s notes. Even in a criminal case it has been done, and the criminal executed according tó the amendment. Grant v. Astle, Doug. 370.
    In slander, it is true, where some counts are for ■ words not actionable, and others for words actionable, on a general verdict, judgment will be arrested, but even then the court will order a venire de nova to asscss damages on the good count. An application like the present is never too late. In 1 D. & -E. it is said an amendment will be ordered even after error brought, and the record sent back from the exchequer chamber. The same principle is found in Taylor v. Whitehead, Doug. 746. If we are successful on the point of an amendment, all objections taken to the second and third counts are at an end. But even should these be objected to, we contend they are good. The instrument declared on, is an engagement in writing by which the defendant promised to pay. The being a note in writing is enough, and purports a consideration though none be stated. 2 Black. Comm. 446. Pillans v. Van Mierop, 3 Burr. 1670.
    
    
      
      
        ch. 118.
    
    
      
       In that case, the amendment was by altering the verdict from a small to a larger sum ; which amendment was moved for, on the face of the declaration. The court said, in fact we cannot load the defendant with more than the jury of his country has determined, without sending him back to another jury.
    
    
      
      
        Doug. 376. see also, Williams v. Breedon, 1 Bos. & Pul. 329.
      
    
    
      
      
        Petrie v. Harmay. There were two issues in that case, the verdict was on one, and no notice taken of the other, the amendment was allowed after error brought, and this assigned as a. cause, on payment of costs.
    
    
      
      
         Green v. Rennet, 783. per Buller, J. But that case does mot apply to amendments of verdicts. It relates to amending mistakes by the act of the clerk, where there is something to amend by. As if he enter against an executor, judgment da bonis propriis, instead of cle bonis testatoris.
      
    
    
      
       The decision referred to, is very different. A verdict had been found for the defendant; a motion fora new trial on account of the verdict’s being against evidence had been denied, after which the plaintiff obtained a rule to show cause why he should not be allowed to enter up judgment on that issue, because, notwithstanding the finding of the jury, the point of law was in favour of the defendant. The court said this being a motion in the nature of one for an arrest of judgment, was never too late before judgment entered- up.
    
    
      
       The two books cited, will certainly warrant the position of the learned counsel, but the parts referred to are not law. In Sharington v. Stratton, Plow. 358. it is said, u By the law of this <( land, there are two ways of making contracts, or agreements for lands and chattels : the one is by words, which is the infe» vior method j the other is by writing, which is the superior.. “ And because words are oftentimes spoken by men unavoidably and without deliberation, the law has provided that a contract “ by words shall not bind without consideration. But where the “ agreement is by deed, there is more time for deliberation ; for “ which reason they are received as a lien final to the party, and “ are adjudged to bind the party without examining upon what “ cause or consideration they were made.” The reader will observe, that when Plowden speaks of contracts by writing, he means by deed under seal. This is more explicitly declared in the case of Rann v. Hughes. Baron Skynner there says, “ All “ contracts are by the laws of England distinguished into agree- “ ments by specialty, and agreements by paroi ; nor is there “ any such third class as some of the counsel have endeavoured K to maintain, as contracts in writing. If they are merely writ- “ ten, and not specialties, they are paroi, and a consideration “ must be proved.” In Pillans v. Van Mierop, Wilmot, J. argued, that if a stipulation, which was only by words, was, according to the civil law, binding without consideration, a fortiori, so must be an agreement in writing. But the civil law itself will not warrant this reasoning. The obligatory force of a stipulation arose from the words being spoken in a precise form, before a public officer; for, if that form was not adhered to, the stipulation was void : therefore if to the question promitits, the party stipulating had answered spondeo, the stipulation was a nullity. I am therefore disposed to think, that the stipulation was taken in the manner of our recognizances, and when acknowledged became a species of record. I am peculiarly induced to this opinion, from the -manner in which they are now entered among the acts of the 
        court, in those of the English tribunals, which follow the civil code; and also from considering, that the reduction of a contract into writing did not, even by the rules of the Roman jurisprudence, preclude from entering into the consideration on which it was made. By that system the obligatio liter'atum arising from the contracts ex Uteris, was invariably comestible in the three following cases: 1st. When the consideration was not expressed. 2d. Even then within two years. 3d. In all cases of loans of money, by the exccfiiio de non numerata fiecunia, which threw the onus of proving a consideration upon the plaintiff. The codex, too, is express that no form of words or writing, but assent alone, formed the contract. Cod, lib. 2. tit. 3.1. 17.
      
    
   Kent, J.

That doctrine has been completely overruled in a case where Skynner, Baron, delivered in the House of Lords the unanimous opinion of the twelve judges.

Caines Amicus curia. Rann v. Hughes, 7. D. & E. 350.

Van JYess. A written contract without considera- . .. , . . non may be declared on as it is.

Lewis, C. J.

This court has decided that a coni tract merely in writing, does not supersede the necessity Of a consideration;

Williams. That the contract was hot consummated by payment of the 810 required by the act, is also urged as a reason why the action cannot be maintained, but surely the commissioners might have dispensed with this. As to the objection that the promise was given to pay such slim as the President, Directors and Company should order; and that the order was only by the President and Directors, it can hardly be thought the defendant ever hoped to rely upon it. The President and Directors are the agents of the Company, duly chosen by them physically and legally to express their will. The order made by the President and Directors, is an order made by the Company. This follows necessarily, for the President and Directors are, by the words of the law, to act for and to manage the concerns of the Company: when • ** they 'were chosen the powers of the Company were transferred to them, and this being under the letter of the statute, they were the only persons to make the order. Had it been complied with, the defendant would never again have been called upon for anything paid under it.

Harison, in reply. In support of the notice in arrest of judgment, nothing can be more clear, than, that where entire damages are given, and one count is bad, the judgment must be arrested. But in this declaration,, there is not one good count, and this is apparent on the face of the record without any aid aliunde. On the first count, the objection, as to thf order, is certainly fatal. The act operating like a charter, specifies a particular manner in which the orders of the subscribers are to be made; the bye-laws of the Company are not to oppose the laws of this State, or the laws of the Union; and yet, supposing the Company to have authorised the President and Directors to make orders on the Stockholders, that very authority can be supported, only by allowing a violation of the law by which the Company itself is incorporated. If one branch of those by whom a specific act is ordered to be done, can be dispensed with, another may, and there is no saying how far this principle is to be carried ; no power can be exercised under the statute, but what is created by it, and executed in the manner it prescribes. On the point in consideration, the authority from 5 D. &’ E. is decisive: no consideration appears by the declaration; the amendment asked must be denied, because it is evident whatever went to support the first count, must have been appii5 k . cable *0 the second and third counts, which were on the ;ame note as that mentioned in the first; if so, Eddowes v. Hopkins, relied on by the plaintiffs, shows the amendment cannot be granted.

Per Curiam,

delivered by Radcliff, J. In this case there is a motion in arrest of the judgment, founded on objections made to all the counts in the declaration.

The counts are three in- number, and the objections which apply to all are,

1st. That the promise or contract set forth in the declaration is void for want of consideration, and connected with this is another objection, which was distinctly urged, that the first instalment of $ 10 not being paid, the contract was incomplete, and not obligatory on the Company and therefore also void. . . •

2d. That the commissioners appointed by the act did not, as soon as 1,000 shares were subscribed, give the notice required by the act to choose Directors.

3d. That no order or determination of the President, Directors and Company requiring the payment of the instalment in question, is stated in the declaration to have been made.

To the second and third counts there is a further objection, that the plaintiffs have declared on the promise or subscription in writing, as upon a promissory note within the statute.

• As to the first, the form of the subscription which contains the promise, is prescribed by the act in the following terms : “ We whose names are hereunto" -6‘ subscribed, do for ourselves and our legal repre- “ sentatives, promise to pay to the President, Direc- ■ ■ tors and Company of the Union Turnpike Road, the • ■ sum of 25 dollars for every share or stock in said “ Company, set opposite to our respective names, in “ such manner and proportion, and at such time and “ place, as shall be determined by the'said President, “ Directors and Company.”'. The declaration states the plaintiff’s subscription in these terms, but does not aver that the 10 dollars on each share were paid, and which the act required the defendant to pay at the time of subscription.

I cannot discover any ground oh which this promise ought to be considered as void. The subscription was taken by commissioners who were authorised to receive it, and in the form prescribed by the act. That form contains an absolute promise to pay the money to the President, Directors and Company. On the one side the interest of the Company in selling the shares, and the public advantage to be derived from the success of the institution, and on the other the expected profits to accrue from the stock, were sufficient considerations to render the promise binding. By force of the act itself it must be considered as good. The legislature also must have intended that it should be obligatory, for else the formal manner in which it was prescribed to be taken would be senseless and nugatory. I cannot imagine that a contract in terms so express and complete should tje. Resigned to mean nothing.

The last section of the act by which the Company was created, cannot, in my opinion, destroy its effect. It is thereby further enacted, that the Directors may call for and demand the sums so subscribed, at such times and in such proportions as they shall see fit, under pain of the forfeiture of the shares and all previous payments. This provision was designed as an additional security for the proportion of the shares which should remain unpaid, and to enable the Company by a decisive measure to compel the prompt payments which the objects of the institution required. They had an election to adopt this expedient, and exact the forfeiture, or to enforce payment in the ordinary course by a suit on the original contract. Not having insisted on the forfeiture, they of course have a right to maintain this action.

The objection which is founded on the idea that the contract was not obligatory on the Company, and therefore not mutual in its operations, I also think is not well taken. The subscription was for the full sum originally due for each share. The 10 dollars on each share were due immediately, and the engagement with respect to that sum was like a note or obligation payable on demand. The contract was complete and the defendant had a right to tender the payment of the 10 dollars, and demand its performance on the part of the Company, who had an equal right-to enforce it against him. Neither party could revoke it without mutual consent, or a default on the adverse side. I, therefore, consider the contract as reciprocally binding, and founded oñ a valid consideration.

The second objection is, that the commissioners appointed by the act did not, as soon as 1,000 shares were subscribed, give notice to the stockholders to choose Directors. This was, I think, properly relinquished by one of the defendant’s counsel. It does not appear when the precise number of 1,000 shares were subscribed. The defendant subscribed his shares on the 17th of April, 1801, arid it is averred, that on the 21st of the same month upwards of 1,000 shares, to wit, 1,990 were subscribed,- and that the commissioners, on that day, gave notice, to choose Directors. The particular time of giving this notice, after 1,000 shares were subscribed, could not be material. The act in this respect was merely directory to the commissioners, and if they did not strictly execute their trust, it could not- affect the existence of the Company, nor any contracts made with them.

\

The third objection is, that no order or determination of the President, Directors and Company, requiring the payment of this instalment, is averred. It is averred that the President and Directors only, made the order. The promise was made to the President, Directors and Company, according to the form prescribed by the act, and it is therefore argued, that this order ought to have been made by the Company as well as by the President and Directors. This criticism ought not to prevail against the only practicable construction that can be given to the mode of executing the powers of this corporation. It is obvious that the Company, in their collective capacity, can never act. The President and Directors are their representatives, and they alone are authorised to manage the concerns of the Company. The act invests them with this powei, and it is thus set forth in the declaration. They alone could require the payment in question, and the order was properly made by them.

The last objection applies to the second and third counts only, in which the plaintiffs have declared on the defendant’s subscription as upon a note of hand, Without setting forth the act, or any consideration to support the defendant’s promise. It is not expressly declared upon as a note within the statute concerning promissory notes, but the counts can be supported on that idea alone, for they do not state .any consideration independent of the malting of the note. The shas es of stock to which the defendant would be entitled, are not set forth as the consideration of the promise, but merely as descriptive of its extent, and as designating the amount he undertook to pay. These cov-ius, therefore, cannot be maintained unless the note be considered to come within the statute, which I think it does not. Although by the note the defendant promised to pay 25 dollars for each share, it depended on the future operations of the Company, which was not yet organized, whether the whole ot any part of that sum would finally be demanded or become due. The payment was, therefore, uncertain and contingent, and such a note has frequently been held not to come within the statute, and can be declared upon only as a special agreement.

These counts being, therefore, defective, and the verdict general, the judgment ought to be arrested unless the verdict be amended by applying it to the first count in the declaration. An application for that purpose was made by consent, concurrently with the' .motion in arrest of judgment. And if the judge before whom the cause was tried will certify that the evidence applied solely to that count, or, as I apprehend the correct rule to be, that all the evidence given would properly apply to that count as well as to the others, I think the amendment ought to be allowed. The practice of amending in such cases is well established, and is consistent with reason and justice to the parties. The result of my opinion, therefore is, that the judgment be arrested unless such amendment be made, and in that case, that the motion be denied.

Lewis, C. J.

These are actions of assumpsit, brought by the President, Directors and Company of the Union Turnpike Road, against the defendant, Thomas Jenkins, on two several subscriptions, amounting to two hundred and eighty share's in the capital stock of said Company, for certain payments called for, pursuant to the act of incorporation, by the said President and Directors.

The declaration contains three counts. The first sets forth the act of incorporation, the formation of the Company pursüant thereto, the subscription, of the defendant, the call for certain payments of seven dollars on each share, and his refusal to pay, whereby he became liable, &c.

The two remaining counts are on the several -subscriptions of the defendant, as on his promissory notes.

A verdict was found generally for the plaintiffs, and the cause is now before us, on a motion in arrest of judgment, on the part of the defendant, and a mo, tian on the part of the plaintiffs, to amend the verdict by the notes of the judge who tried the cause, so as to confine it to the first count in their declaration, on an affidavit, that no evidence was offered on the other counts.

The principal ground of the motion in arrest of judgment is, the alleged want of a consideration to support the promise, without which, it is insisted, the action is not sustainable. On the record no consideration is stated. No loss or gain to either party; and testing the conduct of the commissioners, by the provisions of the act, none is to be found, in my opinion, in the contract itself. The act requires, that to constitute a stockholder, he shall subscribe an engagement in the words following: “ We, whose “ names are hereunto subscribed, do for ourselves i£ and our legal representatives, promise to pay to the “ President, Directors and Company of the Union u Turnpike Road, the sum of twenty-five dollars, for every share of stock in the said Company, set op- “ posite to our respective names, in such manner and iC proportion, and at such time and place, as shall be de- termined by the said President, Directors and Coma panyP It also further requires, that every subr scriber shall, at the time of subscribing, pay unto either of the commissioners, the sum of ten dollars, for each share so subscribed. The subscription and payment are both essential to the consummation of the contract. These were cotemporaneous acts.

The declaration states the subscription by the defendant merely, without averring any payment or demand of the ten dollars on each share; and it was admitted on the argument, that, in fact, they were neither demanded nor paid.

I cannot see, then, any consideration for this promise ; and the legislature appear to have been apprized of the inconvenience that might arise from this source, and have provided for it, in some measure, by the last clause in the statute, which gives a power to the Directors, “ to call for, and demand of S( and from the stockholders respectively, all such u sums of money by them subscribed, or to be sub- “ scribed, at such times, and in such proportions as they shall see fit, under pain of forfeiture of a their shares, and of all previous payments made •u thereon.”

Suppose the speculation had been an advantageous one, and before the first call of the President and Directors, the stock had risen considerably in value, could not the Directors, with propriety, have refused to consider Mr. Jenkins as a stockholder, on account of his not having made the payment required by the act on his subscribing ? I think they coukl. No positive benefit then, arising from the future emoluments. of the Company transactions, can be considered as a consideration for the promise, and if it could, none such is stated on the record.

Notwithstanding the motion to amend, it was im sisted the suit was maintainable on the second and third counts. I think not. For a promise to pay on a contingency, which may or may not happen, cannot be declared on as a note of hand. The instrument must be payable at all events.

The propriety of amending, I need not consider, as I am of opinion, no suit can be maintained on the first count for want of a consideration.

I am of opinion judgment ought to be arrested. 
      
       After pronouncing the judgment of the court, Radcliff, J« -observed, that he thought the regular practice was to obtain the certificate of the judge before whom the cause was tried, that the evidence applied only to the count on which it was meant to enter judgment. Kent, J. who tried the cause, said the affidavit of the plaintiffs’ attorney was correct, and therefore he deemed it sufficient for the amendment. In this the bench concurred.