Case ID: denio_2/html/0375-01.html
Source: Caselaw Access Project
Author: {"author": "\n      Senator Bockee", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

Birckhead and another vs. Brown and others.
    The defendants, merchants in Ncw-York, wrote a letter to a house in Liverpool, in which they said, “ At the request of Messrs. S. & T. and on their account wo beg leave to open a credit for, £10,000, uncovered at any one time in favor of Mr. J. D., to be negotiated by him at Rio de Janeiro by drafts on you at 60 days sight. This credit will expire on, &c. You will of course keep Messrs. S. & T. advised as the credit is used, and they will attend to placing you in funds.” Held, that a party who had advanced money to J. D. upon drafts drawn and negotiated according to the terms of the letter and upon the faith of it, which were protested for non-payment, could not maintain an action against the defendants, for want of a privity of contract between them.
    The defendants having written two other letters at subsequent dates extending the credit in respect to tire amount, and the time of its continuance, but without mentioning the length of the bills; held, that only bills at 60 days were within the guaranty, and that a bill at 90 days was unauthorized.
    On error from the supreme court, where a judgment rendered by the superior court of the- city of New-York in favor of Birckhead and Carlisle against the present defendants in error was reversed. For the facts in the case and the opinion of the supreme court, see 5 Hill, 634. The case was argued here by
    
      J. Prescott Hall & D. Webster, for the plaintiffs in error, and
    
      G. F. Allen & G. Wood, for the defendants in error.
   Senator Bockee

delivered an opinion in favor of reversing the judgment of. the supreme court. He concurred with that court in holding that the letters written by the defendants constituted them guarantors to W. and J. Brown & Co., for such advances as that firm might make within limits prescribed by the letters; but he held that they also imported a further con tract by the defendants with any person who might on the faith of the letters advance money upon the bills drawn by Demarest, that such bills should be accepted and paid by W. and J. Brown & Co., and that such engagement was in the nature of a general letter of credit; and he was of opinion that the plaintiffs by advancing money to Demarest and receiving bills drawn by him on W. and J. Brown & Co. under the circumstances stated in the special verdict became parties to that contract, and were entitled to enforce it by action against the defendants.

Senator Porter also delivered an opinion in favor of reversing the judgment of the supreme'court. He likewise held that the letters in question contained an engagement on the part of the defendants that the bills of Demarest drawn on W. and J. Brown & Co. within the prescribed limits, and negotiated at •Rio, should be duly honored, and that this engagement enured to any one who upon the faith of the letters should advance the money to Demarest on the bills, and that such act would create a privity of contract between the. parties so advancing money and the defendants, and that th< plaintiffs were consequently entitled to recover.

Both these senators were of oj lion that the bills drawn at ninety days were not within the rms of the guaranty, and that the recovery in the superior coi ; was rightly limited to the amount of the draft drawn at sixl ¡days sight.

Senator Talcott delivered ar .the judgment of the supreme cm the defendants’ engagement was only, and that there was no pi ppinion in favor of affirming |, mainly on the ground that to W. and J. Brown & Co. rity of contract between the plaintiffs and the defendants, and agreeing substantially with the positions laid down in the opinion of the supreme court.

Senators Beers and Mitchell also delivered opinions in favor of affirming the judgment of the supreme court.

On the question being put, “Shall the judgment of the supreme court be reversed?” the members of the court voted as follows:

For reversal: Senators Backus, Beekman, Bockee, Corning, Deyo, Faulkner, Folsom, Johnson, Porter, Smith and Varney—11.

For affirmance: The President, and Senators Barlow, Beers, Emmons, Hand, Jones, Lester, Lott, Mitchell, Scovil and Talcott—11.

Judgment affirmed.