Case ID: scl_17/html/0345-01.html
Source: Caselaw Access Project
Author: {"author": "Johnson, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

George Penny v. John Caldwell.
    Columbia,
    Jan. 1830.
    An attorney, who has received the amount of;a nóte left with him for collection by a client, and applied it conformably to his instructions, although the note was not negotiable, and was payable on its face to a third person, and no assignment to the client indorsed, is not liable to the party who was apparently intitled to the note, but of whose actual claim to the money due on it the attorney had no notice, if it appear, that the party himself had , placed., the note in the'hands of the client, with authority to collect it: and it makes no difference, that the attorney was surety for the debts, to which, by the direction of his client, he had applied -the amount collected.
    Tried before Mr. Justice Huger, at Newberry, Spring Term, 1829.
    This was an action of assumpsit to recover a sum of money, which had been collected by the defendant, an attorney at law, for the balance due on a note of Solomon Súber. The note was payable to James Penny, and was not negotiable, and there was no assignment indorsed. It had been placed in the hands of the defendant, with some other notes, by Jamés A. Johnson, who was then closing his business, and about to leave the State, and who instructed the defendant to collect the debts, and apply the money to the payment of certain debts of his own, for which the defendant was surety. The note had been given by Súber for the purchase money of a slave, which he had bought from James Penny, but which he afterwads discovered had been previously conveyed by the latter, with some other property, to the present plaintiff, upon certain trusts ; on which he refused to Pay ^16 balance due on his note, until he had applied to the plaintiff, who confirmed the sale, and gave him a valid title. Of this circumstance the defendant was apprized by Súber, and he issued a writ on the note in the name of the plaintiff, as trustee ; James Penny having died intestate, and no administration of his estate taken out. Súber thereupon paid the amount of his note to the defendant, who applied it as directed by Johnson. It appeared that the note had been placed in the hands of Johnson, with authority to collect jt, by the plaintiff himself, who had got possession of a receipt for the note, which the. defendant had given to Johnson ; but there was no evidence, that the defendant had any notice of the plaintiff’s having any claim, in opposition to Johnson, to the amount due on the note, until the commencement of this suit.
    The presiding Judgfe charged the jury, that if the plaintiff had any claim, at law, to Suber’s note, of which he had great doubt, yet as he had placed it in Johnson’s hands, and thereby enabled him to deliver it to the defendant, and to direct the application of the money when it had been collected, he could not hold the latter liable for making that application, unless he had given him timely notice that he claimed the money due on it.
    The jury found for the defendant; and the plaintiff moved to set aside their verdict, as contrary to law, on various grounds, which sufficiently appear in the opinion delivered by the Court of Appeals.
   Johnson, J.

delivered the. opinion of the Court.

From the view which I have taken of this case, it may be conceded, that as between the plaintiff and Solomon Súber, the plaintiff was equitably, and I think legally, intitled to receive the money due on Suber’s note, it was given as the price of a negro, purchased of j James Penny, which he had before conveyed to the plaintiff, in trust for the uses expressed in the deed, given in evidence ; so that Súber took nothing by the purchase, arid was not",legally bound to pay the amount. The plaintiff, however, on the application of Saber, after the death of James Penny, affirmed the sale, and Súber in consideration thereof, re-assumed the payment of the purchase money to him; and from this contract arises the liability of Súber, and the right of the plaintiff to receive the money. So much as to the rights of the plaintiff. We will now consider of the liability of the defendant.

The plaintiff delivered Suber’s note to one Johnson, with authority to collect the money due on it, and Johnson turned it over to the defendant together with several other notes, some of which were payable to himself, with instructions, generally, to collect them by suit, or otherwise, and apply the proceeds to debts, which he, Johnson, owed, and for which the defendant was bound as his surety, without any reservation as to this particular note, or notice that it belonged to the plaintiff. The defendant collected the money from Súber by suit, and applied it according to the general directions of Johnson : and it does not appear from the evidence, that he had any notice of the plaintiff’s claim until the commencement of this action.

The possession of the note was prima facie evidence of Johnson’s right to collect. In addition to this, he was directly authorized by the plaintiff to receive the amount, and necessarily had the right to direct the defendant as to the disposition of it; and the condition of the profession would be beggarly indeed, if by following the instructions of their clients, attorneys were to incur their liabilities to all the rest of the world. It was, therefore, correctly submitted to the jury, whether the defendant had appropriated the money in the manner directed by Johnson, with instructions, that if they should find in the affirmative, the verdict should be in his favor; and the finding is conclusive.

The third ground of the motion assumes that the defendant claims to retain the amount collected by him, in satisfaction of a debt due by Johnson to himself, and if this was true, I should be disposed to question his right to do so ; but I have examined the report of the presiding Judge, and his notes of the evidence taken on the trial, again and again, with a view to extract from them some facts to support this assumption : but lliey all lead to the conclusion that the defendant paid over the money, under his general directions, in satisfaction of debts due by Johnson to third persons ; for they were not the less his debts, because the defendant was bound for them as his surety.

A partial view of this case would lead one to conclude that it savoured a little of the stricti juris, and operated as a hardship on the part of the plaintiff. But it is a quesiion, which of two innocent persons shall suffer. The plaintiff and not the defendant reposed the confidence in Johnson, and he must bear the loss.

Motion refused.