Case ID: monaghan_2/html/0068-01.html
Source: Caselaw Access Project
Author: {"author": "Per Curiam,", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Henwood v. Bellis.
    On the trial, the evidence showed that the defendant, Henwood, on Aug. 1, 1882, gave the plaintiff, Mrs. Beilis, the following memorandum, written on defendant’s ordinary letter-head and not witnessed : “ For and in considering of 2000 Two Thousand Dollars I hereby sell to Jennie Beilis The tenth Interest of my patent Double action plunger pump No. 247, 642. Patentend Sept. 27, 1882 for the term of seventeen- years. Received on account Five Hundred and Thirty Dollars.” The defendant subsequently paid $930, leaving a balance of I540 still due. On March 4, 1883, Henwood took in partners, in consequence of Mrs. Beilis’s refusing to pay the balance, the defendant testified. He afterwards executed a formal assignment of the patent to the firm and finally sold out all his interest to the other members. The firm refused to recognize any interest in Mrs. Beilis. In an action of assumpsit for money had and received, the court submitted the construction of the written instrument to the jury, charging that if they found that the writing, taken with the other circumstances, was intended as a mere memorandum of an agreement, to be followed by a formal assignment, and the defendant afterwards rescinded the contract, the plaintiff was entitled to recover back the money she had paid. The jury found for the plaintiff. Held, on writ of error, that the judgment should be affirmed.
    Jan. 24, 1889.
    Error, No. 187, July T. 1888, to C. P. No. 4, Phila. Co., to review a judgment on a verdict for plaintiff in an action of assumpsit, by Jennie Beilis against John Henwood, at March T. 1887, No. 820. Clark, J., absent.
    The plaintiff filed a statement in which, after setting out alleged representations made by defendant concerning his business and a patent pump, she averred that she agreed to invest $2,000 in the said business and pump on the terms proposed, and did pay $1,460; and averred that defendant had never paid her any money or transferred to her any interest in the said pump, but on the contrary has since transferred his patent to other persons without reserving to the plaintiff any interest, wherefore she claimed to recover the amount paid to defendant. The pleas were non-assumpsit and set-off.
    The evidence was to the following effect, at the trial, before Thayer, P. J.:
    After preliminary negotiations as to the investment of $2000 by the plaintiff in defendant’s patent pump, or the purchase of an interest in the patent, the matter was concluded between them on Aug. 1, 1882, the plaintiff, the defendant, his wife and his son, who was also plaintiff’s son-in-law, being present. At that time, the defendant executed the following paper, which was written by Alfred Henwood, the son, on a printed letter-head of his father, but which was never recorded:
    “ Philadelphia Aug. 1st 1882.
    “ Fore and in considering of 2000 Two Thousand Dollars I hereby sell to Jennie Beilis The tenth Interest of my patent Double action plunger pump No. 247, 642. Patentend Sept. 27, 1882 for the term of seventeen years.
    [Signed] “John Henwood.
    “ Received on account Five Hundred & Thirty Dollars.
    [Signed] “ John Henwood,
    “ Per A. H.”
    On Aug. 24, 1882, the plaintiff paid $900 on further account,, and subsequently $30, making the total amount paid by her $1460.
    On March 1, 1883, the defendant took in as partners Jos. C. Whitaker and Chas. R. Scull, who each contributed $7500, in all $15,000, under the firm name of Henwood, Whitaker &Co. Hen-wood’s contribution was “the patents, stock, fixtures, machinery, and other articles ” described in the schedule attached, “ and valued at the sum of $15,000.” It was also agreed that “ the interest of the members of the said firm in the capital stock, fixtures, patents, and all other property of the said firm shall be as follows: The said John Henwood shall be entitled to one-half interest, and the said Jos. C. Whitaker and the said Chas. R. Scull to a quarter interest each.” And, in a subsequent section, it was provided that, “ upon the expiration of the said copartnership, all the assets and liabilities, profits and losses,” should be divided in the same proportion. After the formation of Henwood, Whitaker & Co., on May 16, 1883, Mrs. Beilis gave Alfred Henwood, her son-in-law, a power of attorney to collect from the firm what might be due to her, and it was presented soon after, but they refused to acknowledge her interest.
    On Oct. 29, 1883, a formal assignment was made, which read as follows: “ The said John Henwood has assigned, sold, and set over, and does hereby assign, sell, and set over unto the said John Hen-wood, Jos. C. Whitaker, and Chas. R. Scull, all and entire the right, title, and interest in and to said two several inventions and letters patent and each of them, the same to be held and enjoyed by the said John Henwood, Jos. C. Whitaker, and Chas. R. Scull . . .
    as fully entirely as the same would have been held and enjoyed by him, the said John Henwood, had this assignment and sale not been made.”
    On Feb. 1, 1884, Henwood sold out all his interest to his partners at a loss of $5000 or $6000. As a part of the agreement of dissolution, besides agreeing to assign to his partners “ all his interest of whatsoever kind in and to the business, patents, accounts, assets, and property whatsoever.....and to execute and deliver to them good and sufficient assignments and deeds of all patents and other property of said copartnership as to his said interest therein,” he also agreed to give them a bond in the sum of $100, conditioned for their “ indemnification .... of and from all loss and expense that may result from claims growing out of a certain assignment [by Henwood] to Jane Beilis of an interest in letters patent No. 247,642.” The assignment and bond were duly executed the same day.
    The defendant testified, inter alia, as follows : “ I assigned to her one-tenth interest in my patent pump. I only had the patent at the time, nothing was said about any interest in my business, nor in the tools. I was to give her one-tenth of the profits from the manufacture of the pump. At the time the paper was executed, it was understood to convey one-tenth interest in my patent. There were two written, she kept one and I kept one.”
    On cross-examination, the defendant testified, inter alia, as follows: “ I asked for the remaining $540 repeatedly, after the second payment was made. I requested her at her own house in Green Street, in the winter of 1882. In consequence of her refusal to pay I took in partners. . . , I did not tell my partners when we formed partnership that they must give a one-tenth profits to her; it was talked over afterward. I had a one-half interest with Whitaker & Scull. I subsequently assigned them all my interest. I have none whatever now. I was involved at the time the partnership was formed, and I thought that the assignment would protect her.”
    
      The court, after reviewing the evidence, and referring to the paper accompanying the payment of $500, continued as follows:
    [“ The question is whether this paper, taken with the other' circumstances, was intended as a present conveyance, or whether it was a mere memorandum of an agreement to be followed by a formal assignment. It is not signed by the plaintiff but by the defendant. If it was intended as a mere memorandum, then it was an executory contract. It is apparent, if it was merely an executory contract to be performed in the future, and if it was rescinded by the defendant, then he must pay back the money he received.] [1] If, on the other hand, it was intended as an immediate conveyance of the patent, then nothing that the defendant could do would affect plaintiff’s title; even the sale by Henwood to Whitaker and Scull would not affect it. The result would be that Mrs. Beilis would still be an owner of one-tenth of the patent. So, if it was intended as an immediate transfer, and he was to rely upon her credit for the balance of the money, then this action cannot be maintained. [If, on the other hand, it was a mere memorandum of a contract which was to be executed when the money should be paid in full, and the defendant, in. consequence of her not paying the entire purchase-money, afterward rescinded the contract (and his acts are indicative of his intentions), then the plaintiff is entitled to recover back the money she paid. If he rescinded the contract, which he might do if it is executory, then he must pay back the money.”] [2]
    Verdict and judgment for plaintiff for $1829.93.
    
      The assignments of error specified, 1, 2, the portions of the charge included within brackets, quoting them.
    
      Rudolph M. Schick, for plaintiff in error.
    The paper of Aug. 1, 1882, signed by the defendant, contains all the elements of an assignment of a patent, to wit., the number, date, name of patentee and name of invention, and, having been delivered, is sufficient to, and'did, convey to the plaintiff the one-tenth interest in the patent. Hill v. Thuerman, 13 Ind. 351; Case v. Morey, i-N. H. 349; Walker on Patents, § 275.
    It was the duty of the court to construe the agreement. Moore v. Miller, 4 S. & R. 278; Vincent v. Huff, 8 S. & R. 387; Watson v. Blaine, 12 S. &. R. 131; Edelman v. Yeakel, 27 Pa. 30; Coxw. Freedley, 33 Pa. 130; Esser v. Linderman, 71 Pa. 80; Harvey v. Vandegrift, 89 Pa. 352; Bryant*^. Hagerty, 87 Pa. 260; Beatty v. Ins. Co. 52 Pa. 457.
    There was no ambiguity in the written contract, or any arising from extrinsic evidence. Millers. Travers, 8 Bing. 244; Hoffman v. Danner, 14 Pa. 25, 28; Lycoming Ins. Co. v. Sailer, 67 Pa. 112.
    Where the assignment transfers the assignor’s interest only, it does not affect the interest taken by a third person under a prior unrecorded assignment. Walker on Patents, § 281; Turnbull v. Plow Co., 6 Bissel, 225.
    
      Jan. 24, 1889.
    The assignment to the firm did not affect the plaintiff’s interest in the patent, as the firm took with notice. Walker on Patents, § 281 ; Continental Windmill Co. v. Empire Windmill Co., 8 Blatch. 295 ; Bank of U. S. v. Davis, 2 Hill, 451; North River Bank v. Aymar, 3 Hill, 262. In general, a notice to one partner is binding upon all; as of a prior unrecorded deed, the knowledge of which by one partner will avoid a subsequent deed to all the partners. 1 Parsons on Contracts, 187.
    Even if the effect of the assignment to the firm of Henwood, Whitaker & Co. was to deprive the plaintiff of her interest, it is the result of her own negligence in not having her assignment recorded, and she cannot complain. 2 Wharton on Contracts, § 947; Straton v. Rastall, 2 T. R. 366; Stray v. Russell, 1 E. & E. 888.
    
      Gustavtis Remak, Jr., for defendant in error.
    The informal paper of Aug. 1, 1882, ought to be construed as a mere memorandum of agreement, an executory contract which Henwood rescinded. And if he did rescind, he must undoubtedly pay back the money he received. Doughten v. Building Ass’n, 41 N. J. Eq. 556.
    Did the parties intend, by the words “ I hereby sell,” to express, “ I agree to sell,” or “ I assign, transfer and set over ? ” If we are to believe that Henwood acted in good faith toward Mrs. Beilis, the former construction should prevail. “ If a contract is open to two probable constructions, one of which would impute fraud or illegal purpose to one of the parties, while the other construction would be free from such taint, the latter construction will be adopted.” Wharton on Contracts, § 654.
    This court has uniformly held that the circumstances attending a grant and acts subsequent to it may be shown by parol evidence to arrive at the intention of the parties. Miner’s Ap. 61 Pa. 283 ; Atty. Gen. v. Drummond, 1 Dr. & W. 353; Callen v. Hilty, 14 Pa. 286; Frazier v. Monroe, 72 Pa. 169; Williamson v. McClure, 37 Pa. 408; Lehigh Coal and Nav. Co. v. Harlan, 27 Pa. 439 ; Erwin’s Ap., 20 W. N. C. 278; Wharton on Contracts, § 653.
    “ When a contract consists of mere memoranda, and though intended to be final, is rather to be regarded as a short-hand statement of the intention of the parties than as an exact expression of that intention, it may be helped out by parol proof.” Wharton on Contracts, § 661; Allen v. Pink, 4 M. & W. 144; Phillips v. Swank, 120 Pa. 84. #
    Under all the circumstances of the case, it is-reasonable to conclude that the intention of the parties may well be viewed as a question which assumes the importance of a material fact, collateral to the interpretation, and to be first ascertained, and the effect of a paper as evidence of a collateral fact is for the jury. Reynolds v. Richards, 14 Pa. 205 ; McKean v. Wagenblast, 2 Grant, 462.
   Per Curiam,

Judgment affirmed.