Case ID: va_62/html/0742-01.html
Source: Caselaw Access Project
Author: {"author": "STAPT.JSS, J.", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

*Jones v. Thomas.
    June Term, 1871,
    Wytheville.
    Bonds — Case at Bar. — A. T. executes Ms bond as follows: March 12th, 1863. I hereby bind myself, my heirs, &c., to pay-the amount of principal and interest due from W. A. J. on the tract of land purchased by him of G. W. J. and wife. Witness my hand and seal the day and date above: And he delivers it to W. A. J. Held:
    i. Same — Suits by Beneficiaries.- — W. A. J. may maintain an action of covenant on the bond against A. T. See Code 1860, ch. 116. § 2.
    2. Same — Same—Allegations.—w. A. J. may recover upon the bond against A. T. if A. T. has not paid the debt, though it is not averred or proved that W. A. J. has paid it, or has been otherwise injured by the failure of A. T. to pay it.
    3. Same — Same—Same.—The declaration does not, in its commencement, aver that A. T. covenanted with the plaintiff to pay the debt; but it does so in a subsequent part of it. This is substantially sufficient.
    '4. Pleading and Practice — Covenant — Declaration.— In a declaration on a covenant, it should be set ' out without any intermediate inducements or statement of the consideration; but if averments are made, which may be treated as mere surplus-age, they will not vitiate the declaration.
    S. Bonds — Suits by Beneficiaries — Qumre;—Queers: If G. W. J. might'notsue on this bond in his own name to enforce the covenant of A. T. under the act Code of 1860, ch. 116, § 2.
    This was action of covenant in the Circuit court of Smythe county, brought in September 1866, by Wm. A. Jones, against Abijah Thomas, upon a writing, of which the following is a copy:
    March 12, 1863. •
    I hereby bind myself, my heirs, &c., to pay - the amount of principal and interest due from W. A. Jones, '"'on the tract of land purchased by him of G. W. Jones and wife. Witness my hand and seal the day and date above.
    Abijah Thomas, [Seal.]
    The last amended declaration sets out, that on, &c., the defendant made’his certain deed poll signed, &c., and sealed, &c., and delivered the same to the plaintiff, to wit: on the day and year last aforesaid, &c., by which said deed poll the said defendant covenanted and bound himself, his heirs, &c., to pay the amount of principal and interest due from Wm. A. Jones, plaintiff; on a tract of land purchased by him from G. W. Jones and wife. The declaration then sets out that the plaintiff is the Wm. A. Jones mentioned in the deed; that he had purchased the land, and at the time of the execution of the deed poll, there was due upon the land, $7,500 with interest, which was a charge upon the land, and the plaintiff sayeth, that the said defendant by his deed covenanted to and with the plaintiff, and bound himself and his heirs, to pay the said stun of $7,500 with interest thereon, to G. W. Jones, to release the said land of the plaintiff from the lien, &c. And the breach was, that he had not paid the said sum of $7,500, or any part thereof, to the said G. W. Jones, or to any other person.
    The defendant craved oyer of the writing, and demurred to the declaration; and the court sustained the demurrer, and rendered a judgment for the defendant. To which judgment, the plaintiff obtained a super-sedeas from the District court of appeals at Abingdon ;■ where it was affirmed, and he then brought the case to this court.
    Terry, for the appellant.
    
      B. R. Johnston and Gilmore, for the ap-pellee.
    
      
       Bonds — Declaration.—See monographic note on “Bonds.”
    
    
      
       Sealed Contract — Suits by Beneficiaries. — At common law, an indenture or deed inter partes is only available between the parties to it, and their privies ; and third persons can maintain no action on covenant thereon, though made for their benefit. This rule laid down in principal cáse was approved in Stuart v. James River, etc., Co., 24 Gratt. 294; Willard v. Worsham, 76 Va. 397; Newberry Land Co.v. Newberry, 95 Va. 120, 27 S. E. Rep. 899; Johnson v. McClung, 26 W. Va. 662. See also, Ross v. Milne, 12 Leigh 204.
      This rule,, however, does not apply to deeds poll, for, at common law, a person, though not a party to a deed poll, could sue upon it if the instrument showed upon its face that it was made for his benefit. See Jones v. Thomas, 21 Gratt 96; Stuart v. James River, etc., Co., 24 Gratt. 297; Newberry Land Co. v. Newberry, 95 Va. 120, 27 S. E. Rep. 899; Johnson v. McClung, 26 W. Va. 669.
      Same — Same—Effect of Statute. — Newberry Land Co. v. Newberry, 95 Val 120, 27 S. E. Rep. 899, was an action of covenant on a sealed contract inter partes. The plaintiff was not a party to the contract, nor a privy to such party, nor did he appear in the contract as a beneficiary; but it was contended that the rule laid down above, as to suits .by beneficiaries under a sealed contract intei' partes, had been abrogated by tbe statute incorporated in tbe Code of 1849 and wbicb constitutes sec. 2415 of tbe Code of 1887. But tbe court said : “If one of tbe objects of tbe statute was to abolisb tbe distinction between deeds inter partes and deeds poll in tbe respect referred to, and to bring tbe former witbin tbe rule of tbe common law applicable to tbe latter, It was clearly not intended to change tbat part of .tbe rule tbat only a person named or definitely pointed out in tbe deed as tbe beneficiary can sue tbereon, and tbis was not its effect. Tbe statute, does not enable one, wbo is not a party to tbe deed, to maintain an action tbereon, unless be is plainly designated by tbe instrument as tbe beneficiary, and tbe covenant or promise is made for bis sole benefit As was said by Judge Anderson in Stuart v. James River, etc., Co. (24 Gratt. 294), tbe rule of the common law in tbis respect has not been changed by tbe statute.”
      But it has been well suggested in tbe 4 Va. L. R. 616, that, while, in tbe Newberry case, tbe plaintiff could not maintain bis suit under sec. 2415, yet, since it seems tbat under sec. 2860 one may sue as beneficiary owner under a deed inter partes though bis interest nowhere appears on tbe face-of tbe instrument, it is probable tbat bis action might have been sustained, under tbe last mentioned statute if there had been tbe proper allegation and proof of bis beneficial ownership.
    
   STAPT.JSS, J.

This is an action of covenant brought *'in the Circuit court of Smythe county. It is founded upon the following instrument.

March 12th, 1863.

I hereby bind myself, my heirs, &c., to pay-the amount of principal and interest due from W. A. Jones on the tract of land purchased by him of G. W. Jones and wife. Witness my hand and seal the day and date above.

Abijah Thomas, [Seal.]

The defendant demurred to the declaration, and upon argument the demurrer was sustained, and judgment rendered in favor of the defendant. Upon appeal to the District court at Abingdon, that judgment was affirmed. The case is now before this court upon a writ of error and supersedeas to the judgment of the District court. Various grounds have been urged in support of the demurrer — now to be considered. It is insisted that as the plaintiff in error is not a party to the instrument, nor the debt payable to him, he can maintain no action-thereon in his own name. It is undoubtedly true that at common law an indenture or deed inter partes is only available between the parties to it, and their privies; and third persons can maintain no action on covenant thereon, though made for their benefit. This rule, however, does not apply to deeds poll — as to which it has been long settled that persons beneficially interested therein may sue, though not described as contracting parties.

The distinction is founded on the difference in the form and qualities of the respective instruments. A deed inter partes is a agreement under seal between two or more persons executing the same, and entering into reciprocal obligations with each other. It is a solemn declaration that all the covenants comprised in. the instrument, are intended to be made between those parties and none others. A deed poll on the other hand, is the act of a single party, and is in the nature of a *declaration made by him of his intentions or obligations to some other person.

The case chiefly relied on by the learned counsel for the defendant in error, is that of Green v. Horne, 1 Salk. R. 197. That was an action of covenant upon any instrument in these words: “I (the defendant) do promise and engage myself to bring in-the body of A, to the custody of B, bailiff (such a day). The plaintiff declared that A, being indebted to him, and arrested at his suit, the defendant, in consideration that the plaintiff would order the bailiff to let A go at large, covenanted with the plaintiff to bring in the body of A, and deliver him to the custody of the bailiff.” The court held that the plaintiff was no party to the deed, and could not maintain an action upon it. Now, it will be observed that the defendant’s covenant was to produce the body of A, and deliver him to the custody of the bailiff. But the plaintiff is not named, nor in any manner alluded to therein. Whatever connection he had with, or interest in, the covenant, could only be shown by testimony dehors the deed.

In Sunderland Marine Ins. Co. v. Kearney, 71 Eng. C. L. R. 925, 937, the objection was made that the plaintiff was improperly joined as a party, his name not being mentioned in the policy on which the action was brought; and in support of this objection much reliance was placed on the case of Green v. Horne. Lord Campbell, delivering the opinion of the Queen’s Bench, said it could not be meant by that rule that the party’s name of baptism and his sir name, must necessarily be set out. If he be sufficiently designated in the deed, this must be enough to entitle him to sue for breach of covenant. A description which cannot be mistaken, is, for this purpose, as good as the actual name of the individual. And in Fellows v. Gilman, 4 Wend. R. 414, the Supreme court of New York thus expressed the rule: “It must undoubtedly appear that the covenant alleged to have *been broken, was made for the benefit of the person bringing the action. He must in some manner be pointed out or designated in the instrument, but it is not necessary his name should in terms be used. The defendant’s covenant is to pay each and every person such sum as the constable shall become liable for. This, in connection with the allegations in the declaration, shows, as satisfactorily as in the case of an heir or executor, that the plaintiff was one of the persons for whose benefit the covenant was executed. ” See also, 2 Lomax Dig. 9; 4 Comyn Dig. 282; Chiles v. Conley’s heirs, 2 Dana’s R. 21; Webb v. Denn, 17 How. U. S. R. 576. These cases show the inclination of the courts to give effect to the contracts of parties, and never to declare them void if by any reasonable and fair construction they can be made good. ■ They establish the proposition that persons not described as parties in deeds poll, or even mentioned as having beneficial interest therein, may sue thereon in their own . name, if it manifestly appears the covenants were made for their benefit.

Applying these principles to the covenant here, it is clear the plaintiff in error has a right of action thereon. Slight attention to the language of the instrument will show, that the covenant was made with him, and was intended for his benefit; the obvious design and effect being to relieve him of the payment of the debt due to G. W. Jones. It may operate also to the advantage of the latter in the additional security afforded him, but the person chiefly and primarily interested, is the debtor, in the relief afforded him against a heavy pecuniary obligation binding him personally not merelj', but also constituting a lien upon the real estate purchased from G. W. Jones.

It was argued, however, that George W. Jones is also designated in the instrument; and as the money, by the terms of the covenant, is to be paid to him, the suit should have been in his name.

*In actions upon parol contracts, the rule is well established, that the party may sue thereon with whom the contract is made, or who is beneficially interested in it. When a promise is made to a person indebted to another, to pay the debt to the creditor, and the latter is a stranger to the contract and to the consideration,, the party to whom the promise is made alone has the right of action thereon. A modification of this rule is to be found in a class of cases which hold that where the debtor places money or property in the hands of a third person as a fund from which the creditor is to be paid, the latter may maintain an action against the holder of the fund. In such case a trust is created, and a promise inferred on the part of the holder, from his acceptance of the fund . without objection, to pay the creditor. Ross v. Milne, 12 Leigh, 204; Arnold v. Lyman, 17 Mass. R. 400, 575; and cases cited in 3 Rob. Prac. 18 and 19.

In actions upon sealed instruments different principles apply. When a debt exists from one person to another, and an obligation or bond is given to the debtor to discharge such debt, he alone can maintain an action for the breach of such obligation. In McAlister v. Marbury, 4 Humph. R. 426, A bound himself by covenant to pay for B certain debts due by B to C. C-instituted an action of covenant against A on the 'instrument. It was held that he had no legal interest therein, and that an action in his name would not lie. It is laid down in 2 Tucker’s Com. 209, and. the proposition is sustained by numerous authorities there cited, that when a covenant is made with A to pay him or a third person a sum of money for the benefit of the latter, the action must be brought in the name of A; and the third person cannot even release the demand. See also, Millard v. Baldwin, 3 Gray’s R. 484; Watson v. Inh. of Cambridge, 15 Mass. R. 286; 3 Rob. Prac. 15.

If the covenant in this case had been made in fact with George W. Jones, as it might have been, there *would be no question of his right to sue thereon in' his own name. And I am inclined to think that, as it is for his benefit, although not made with him, he might maintain the action under the provisions of the 2d sec. chap. 116, Code of 1860. These provisions, however, do not affect the interests of William A. Jones, the plaintiff in error. The effect of this statute is not to. divest rights, but to afford remedies to parties not allowed by technical rules of pleading at common law.

It is said, however, that on the face of the instrument here, it is uncertain whether the covenant was made with George W. Jones and for his benefit, or with the plaintiff in error. It appears, by an inspection of the paper as it was originally drawn, the blank was filled with the name of the plaintiff in error as payee, and the contract in that condition, was a covenant to pay him the debt due George W. Jones. Subsequently, the name of the plaintiff in error was erased by running a line across it, but yet leaving the name sufficiently distinct. It probably occurred to the parties after the instrument was drawn, that as the arrangement was for the defendant, Thomas, to pay an existing debt due to George W. Jones, it was inconsistent with that arrangement to stipulate for its payment to the plaintiff in error; and so the name was erased, leaving it an obligation to pay George W. Jones.

Whether this be or not, the correct solution, the name of the plaintiff in error in the connection with which it is mentioned, clearly indicates him as the real party to the transaction, and as the person for whose benefit it was made. This presumption is rendered conclusive by the delivery to the plaintiff in error, and his acceptance of the obligation. In Coit v. Starkweather, 8 Conn. R., 289, a person known as A. B. was mentioned in the- deed. There were, however, two persons known by that name, A. B. and A. B., jun. It was decided to be competent to show that the latter was intended, though the addition *of jun. was omitted. The evidence adduced was, that the son negotiated for the deed, and that it was delivered to and intended for him. Such evidence does not introduce into the deed a new name or another description. Its effect is simply to identify the person, and apply the provisions of the instrument to the subject for which they are obviously intended.

In an action upon an I. O. U., signed by the defendant, objection was made to the introduction of the paper, upon the ground there was no proof it had been given to the plaintiff. But it was held that the production of the instrument by the plaintiff was evidence that the plaintiff received it from the defendant, and established a sufficient case for him, in the absence of evidence tending to show the paper had been in the hands of the other party. It seems to me these decisions are founded on good sense and sound principles.

A. paper regularly executed in all respects, having the solemnity of a deed, binding the obligor or covenantor to pay a debt due by A B to C D, nothing else appearing, is delivered by the party executing it to A B, is it possible to come to any other conclusion than that this was a covenant with A B, and intended for his benefit. Are the courts to declare such an instrument void because it accidentally, or from ignorance of the parties, omits to state what is perfectly apparent, that the promise was made to A B, and was intended to relieve him of the payment of the debt. No adjudicated case, no dictum of any commentator, has been cited in support of a doctrine which sacrifices the intent and meaning of the parties upon a so narrow and rigid rule of construction. I think, therefore, the suit was properly brought in the name of the plaintiff in error.

The other objections relate to the form of the declaration; and will now be briefly noticed. B'irst. It is insisted there is no averment that the covenant was made with the plaintiff. In the commencement of the declaration, *most appropriate for that purpose, no such allegation is made; but further on it is distinctly averred, that the defendant covenanted to and with the plaintiff; which is substantially sufficient.

Secondly. The declaration makes an averment of facts not contained in the obligation ; which is not allowable in declaring upon covenants. The better and most usual practice, in such cases, is to set out the covenant without any intermediate inducement or statement of the consideration. Where the deed is so defective that no action thereon can be sustained, the defect cannot be cured by an allegation of extrinsic facts; as was decided in the case of Green v. Horne. But where the declaration sets forth a valid contract, and a good cause of action, independently of such averments, the incorporation of such extrinsic matter will be regarded as surplusage, and will not vitiate the pleading. In this case the statement that the debt was a lien upon plaintiff’s land was no doubt made with a view to show that plaintiff was exposed to the hazard of the enforcement of that lien by reason of defendant’s failure to fulfil his covenant. The most that can be said is, that such an averment is wholly unnecessary, and may therefore be rejected as sur-plusage.

It was further argued, that the mere failure to pay the debt is not such a breach of the covenant as entitles the plaintiff to recover, without an averment and proof of some special damage; and in any event it should appear that the plaintiff himself has paid the debt, or has been required to do so. The proposition is not sustained by sound reason or by the adjudicated cases.

When the undertaking is to perform a collateral act, the party may perform it any time during his life, unless hastened by request. But, wherever the stipulation is to pay money even to a third person, and no time is specified, it obliges the party to pay immediately; and the failure to do so is a breach of his contract, for which an action will lie, and it is no answer to such action to *say that the plaintiff has not been injured. It would be against all justice to permit the covenantor to say that his covenantee shall subject himself to the inconvenience and embarrassment of first paying the debt before the covenantor shall be called on to pay. The latter suffers no prejudice in being required to pay the whole amount. As he failed to pay the original creditor, he should pay his covenantee: What the latter may do with the money does not concern him. The courts, therefore, hold that the covenantee need not show that he had paid the debt, or that he had been injured otherwise by the failure of the covenantor to comply with his engagement. All that is necessary for him to show in such case, is, that the debt due by him to the third person was not paid by the covenantor at the appointed time; or, if no time was specified, that it had not been paid at the commencement of the suit. And, upon establishing this fact, the covenantee is entitled to a recovery of damages equal to the whole amount of the debt. These propositions are sustained by the cases of Holmes v. Rhodes, 1 Bos. & Pul. R. 638; Hodgson v. Bell, 7 T. R. 96; Port v. Jackson, 17 John. R. 239 & 479; Thomas v. Allen, 1 Hill’s R. 145; Churchill v. Hunt, 3 Denio 321; Lethbridge v. Mytton, 22 Eng. C. L. R. 181.

In the case under consideration, the covenant is not a covenant of indemnity merely, but an undertaking to pay the debt therein mentioned; to do an act in discharge of the plaintiff for his obligation; and the breach of this contract entitles the plaintiff to damages: to what extent this court is not called on to say, as that question is not properly before us, nor have we the materials for rendering a proper decision thereon.

Upon the whole, I think the declaration substantially sufficient; and therefore the judgment of the District court and the Circuit court should be reversed, with costs; and the case remanded to the Circuit court of Smythe county for further proceedings: upon which the *defendant shall have leave to withdraw his demurrer, and plead to the action, if he should so desire.

The judgment was as follows:

The court is of opinion for reasons stated in writing and filed with the record, that the declaration in the record mentioned was substantially sufficient in law, and hence, that the said judgment of the said Circuit court in sustaining the defendant’s demurrer to the same, and the said judgment of the said District court of appeals in affirming the said former judgment, were erroneous. Therefore, it is considered that the same be reversed and annulled, and that the plaintiff in error recover against the defendant in error their costs in the said District court and in the said Circuit court, together with their costs expended in the prosecution' of their writ of error here. And the cause is remanded to the said Circuit court of Smythe county for further proceedings, in which the defendant shall have leave to withdraw his said demurrer and plead to the action if he shall be so advised.

Judgment reversed.