Case ID: scl_34/html/0377-01.html
Source: Caselaw Access Project
Author: {"author": "O’Neall, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Legare & O'Hear v. Joseph Fraser.
    
    Where an agent suffers damage from a failure of the consideration of a contract made for his principal, the statutes of limitations begins to run in bar of his action against the principal, to be refunded his loss, not from the breach of the contract, but from the time when the damage was incurred.
    
      Before Evans, J. at Charleston, Fall Term, 1848.
    The plaintiffs were factors, and the defendant a Christ Church planter. In August, 1838, the plaintiffs, as factors of defendant, sold seven bales of' long cotton to Murray, the agent of Hyde, a cotton-buyer at Liverpool, for thirty-three cents a pound. In March, 1839, Hyde sold the cotton at a profit, to a manufacturer, who kept it unbroken until May, 1840. At that time, the packages were broken, for the purpose of manufacturing it. It was then discovered that six bales of the cotton were falsely packed. The outside was fair white cotton, and had been wet with fresh water, and, as was supposed, repacked in America. The cotton was examined by brokers, who decided it was unmerchantable, and should be returned to the seller. The cotton was accordingly returned to Hyde, and resold at a heavy loss. Hyde refunded the money, for which he had sold the cotton, being a greater stun than he had paid for it. The plaintiffs were no-rifled, and, as they alleged, gave notice to the defendant, from whom no answer was received. They declined to pay, and were sued by Hyde, in July, 1843; and at May term, 1846, the case was tried, and a verdict rendered against them for the sum for which the cotton was sold in Charleston, deducting the price of resale, after the discovery of the alleged fraud. The money was soon afterwards paid, and this action brought to recover it from the defendant.t When the plaintiffs were sued, they gave notice to the defendant and required him to defend the action, but he wholly neglected to do so, or to give them any information in relation to the cotton. On the trial of this case, the defendant proved by his nephew, who lived in his house, and by his overseer, that the cotton had been carefully handled, ginned, moated and packed, and if their statement was true, it went very far to disprove the evidence of the brokers, who had examined the cotton in England. To the action of Hyde against the plaintiffs, they pleaded the statute of limitations, but it did not avail them on the trial.
    On the trial of this case, the defence mainly insisted on, and that which is made the ground of appeal, was the statute of limitations. On this point, the jury were charged, that the statute did not bar the action.- The plaintiffs being mere agents to sell, and not buyers of the cotton, no action accrued to them, by reason of the sale. They could not sue the defendant, until they paid the money. The cases quoted, were cases, where there was a contract of sale, and an implied warranty between the seller and buyer.
    And that the relation, between the principal and agent, imposes on the former a liability to imdemnify for any necessary expenses, growing out of the agency, andas the plaintiffs were obliged to employ counsel to defend an action for the benefit of the defendant, he should pay the fee paid to their attorney.
    On the question of the fraudulent packing of the cotton, the jury were charged that the verdict of Hyde, against the plaintiffs, was not conclusive against the defendant, but that under the circumstances, he ought to make out a. very clear case, that the cotton was not such as it was proved to be in England. He had the opportunity to make his proof, when the case of Hyde against the plaintiff, was tried, and should have done so then. The1 jury found for the plaintiff, the whole demand. ' .
    The defendant moved the Court of Appeals for a new trial, on the following grounds:
    1. That the plea'of the statute of limitations was a good bar to the action, and that his Honor erred, in charging the jury to the contrary.
    2. That his Honor erred in ’charging the jury, that they were at liberty to find for-the plaintiffs the amount of seventy-five dollars, paid by them to Messrs. Bailey & Brewster, as a counsel fee, for defending a suit brought against them, by, one R. E. Hyde.
    3 b. & A. 288.
    3. Because the verdict was otherwise contrary to law and evidence.
    Ferrell, for the motion.
    Legare, contra.
   O’Neall, J.

delivered the opinion of the Court.

In this case, I do not think the statute of limitations can protect the defendant. The statute cuts off the action of as-sumpsit, where, between the citizens of the same State, laboring under no disability, four years have come and gone, after the cause of action given, or accrued before the suit is brought. The inquiry is, when did the plaintiff’s cause of action accrue, certainly not, until they incurred damage, on account of their relation to the defendant, when they paid money for and on account of him, then they could sue him but not before. After May, 1846, they were compelled to pay on account of the defendant’s cotton, which they had sold as his factors, the amount now claimed. For this, they certainly had no right of action, until they paid the money. It is true, if the statute could have protected the plaintiffs, from the action of the person (Hyde) to whom they sold, then the defendant could stand on that ground and defeat the plaintiffs. But it seems Hyde, who lived beyond seas, (and who is therefore entitled to five years to bring his action,) bought the cotton in March, ’39, and brought suit in July ’43. His action was therefore clearly in time.

If this were an action, on the sale of the cotton, in March, 1839. against the defendant, then the action would be like, Bartley v. Faulkner, where winter wheat was delivered, on contract to deliver spring wheat, and the statute would run from the breach of the contract, and not from the discovery of the fraud.

But here the action is not on that contract. It has already been tried, and disposed of, in the case of Hyde v. Legare and O'Hear. They have been charged on that contract,,and they now say, we made that contract as the agents of the defendant, we give him notice to defend it, as well as we could, but notwithstanding our defence, we were held liable, and we have been compelled to pay the' sum now claimed, and we therefore demand it from the defendant. From this statement, the defendant’s liability is apparent. The only question would seem to be, whether the verdict against Legare and O'Hear, must not be regarded as a verdict against this defendant, and conclude him from any anterior defence? I should (if it were necessary) be very much inclined to say it would.

This question about the running of the statute of limitations may very well be judged of, by the analogous case of gurety an¿ principal. The principle is very well stated, in Angell on Limitations, 186. “An action by a surety, against debtor, is not barred by the time, which has elapsed, since the debt was incurred, but only by the time which has elapsed, since the surety paid the money, if the money was paid ^ ¿/ie surety before the liability to the original creditor was barred. The same doctrine was recognised and enforced in Peters v. Barnhill. There is nothing in the second ground; the counsel fee, like the costs and expences incurred, might be recovered, if the plaintiffs litigated in good faith. That they did, is most manifest. For their defence saved the defendant from a part of the sum claimed, which, if they had treated the case, as he did, might have been recovered.

i Hill 234 1 ’

The motion for a new trial is dismissed.

Evans, J. — Wardlaw, J. — Frost, J. — and' Withers, J. concurred.

Motion refused.