Case Name: The Baltimore Insurance Company vs. M'Fadon
Court: Court of Appeals of Maryland
Jurisdiction: Maryland
Decision Date: 1815-12
Citations: 4 H. & J. 31
Docket Number: 
Parties: The Baltimore Insurance Company vs. M‘Fadon
Judges: 
Reporter: Reports of cases argued and determined in the General Court and Court of Appeals of the State of Maryland, form 1800 ... [to 1826]
Volume: 4
Pages: 31–45

Head Matter:
The Baltimore Insurance Company vs. M‘Fadon
A policy sum nee dated tfA ^™1'(¡“"‘{j &.°*1 ™°i “j' cm m,™ i; to‘t\ onth'' continent <X south America,*1*\ proceeded <m bee voyaiio t<> c »á not to A^mid wkeft captured h.'d a. ry* idea rat tee fhí* C. tog, tlur with a Ittll of lading, fit" vosee mal mamf« st affiíiTN^Ppu’ín ™"°óf'i-»\niítl™ fiivain «£ nmmteff of the earfto,passport* sea ief-
tfcer; in all of which the voyage was described as a voyage front B to C. The evidohte of the captain said document^ was known to the assurers — 7/eW, that if (he vessel did in fact proceed on a voya^ irorn B to A,at the time mentioned, and if the iket* that she had cleared out for C, ami had on hoard *fce sakl documents, drscribin;; her voya^-* as ,i voja :<> to C, v.is known to fir'* usurers at the time of making the peliej , then the clearance, and the documents, could not hi law affect the assured’s vifjht
it the intent and object of the voyage, and the i:i->triictiom to the master of the vesse', were to seed with the car^o to A, and there leave the vessel to s*o to ,], a nort within the tern lory of (he i'renrh republic, and under the known and acknowledged authority of'2n anee, and at. J ro se 1, bat'd roa* AAchange, or otherwise dispose of, the cara;», or a parr thereof, to or wi’h -m/nop 'non at .T, or with the j>roetvds of the carjro fo purchase there the whole or a na‘*t of a return carg-ofor the owners, wkli in-5í?n to convey and ship the same on hoard the said v< ss>-5 as a return c-ir;yo, or part of a return carijo, ■ihtiT then the as-aired ranuot recover (ha* N/c/ioAven, Ch- .7. i*> the eoinny court
A promussory note drawn b3r iJ, in favour of D, may be -»et osf m an action on ail open policy of insurance brought cy i' aguinst D
Where a vesse” and cargo, after being captured,wove libelled as in ixe am! for salvage in the court i,£ ■sice admiralty, and part of the car^’o was ^old b' virtue u an intevsocutorv decree of that enuri. for' Jess than the value,according’ to the invoice and ac tual price, and the proceeds of sale- paid to ’he as - sured; anti the vessel and car^o were acquitted .mi! ordered to be rcs.oied by o final dtcree, and the vessel and residue of the earyo given up to the assured, who so d ¡he residue of the car#» íoy k-’s f him. She value, ¡iee>»rduig to the iirmiee. and received the same — AeW, ihai the assured v 't«- entitled to reco*» Vs-r5 as for a partial io^ for the diilevence between the sum produced by the sale oí ¡hat par»- of tl»« f-.arji’o wh*ch was sold by the order of the court of vice rut..lira! ty„ and the .u-fual value thereof at tin? port of H, where the insurance was edi cted, but thsu the assured was not entitled to recover for the ¿Üífi ronce between the sum produced by the sale of th J part ui the car^o which was sold bj the assar-hijiiself. and tVe Hftua] vmuc tkereof at tin* pert. <d B
Ai-fkai. from Baltimore County Court. This was ¡A ¶¶ action of covenant on a policy of insurance dated the 11 tii of March if 99, brought in the name of John M-Fadon, as surviving partner of S. Lawson, for the use of Dorsey and Llollim. The defendants, (now appellants,) pleaded infre.gU eonventionem, and bankruptcy of the plaintiff, issue was joined to the first plea, and a replication to the - . ,. .. in *n»*i second plea, that the policy was assigned, &c. ¿iejosnaer, that all errors in the pleadings should be released. . t „ that there was no assignment. I here was an agreement 3 iJ
The plaintiff, (now appellee,) at the trial, read m iividencé the policy of insurance in the declaration mentí-oned, under the common seal of the ilefcndanisj and also gave in evidence, that on or about the 1st of March 1799, ■She brig Betsey, in the policy mentioned, sailed from íimore to Barracón, in the Island of Cuba, on the ° ° risured in and by the policy, having on board a cargo of the láwful goods to the valúe of ^30,000, and upwards, property of the plaintiff and II. Lawson, and R. Catón and j. F. Kennedy, all then citizens of the United States; that the said brig} With said goods on board, then proceeded oii the said voyage, ahd while in the regular prosecuti* on thereof, ori .the high seas, afterwards, to wit, on or about the 20tb of March aforesaid; was captured and taken, together .with the said .goods, by á British ship of war, whereby the said goods were totally lost to the plaintiff, and R. Lawson; J. F. Kennedy arid R. Cdton. The defendants then gave iii evidence, that the brig Betsey, on the said 1st of March aforesaid, cleared out from the port of Baltimore for Carthageña, on the continent of South America, and actually proceeded,.on or about that day, on A voyage to Carthagena, and not to any port in the Island <>f Cuba-, and that the said brig then and there took on board, and at the time of the capture had on board, a regular clearance for Carthagéna, together with a hill of lading, invoice and manifest,.of the said cargo, and affidavit to prove the .property thereof annexed to the said invoice, á letter of instruction from the plaintiff to the captain of the said brig relative to .the said manifest of the cargo, passport voyage, and a sea-letter therefor; in all of which several papers and documents the voyage is described as and declared to be a Voyage from Baltimore to Carthage-na. And the defendants read in evidence the said clearance, bill of lading, invoice, affidavit, letter of instructions, passport and sea letter. The defendants further gave in evidence, that at the time of making the said policy, it was, and ever since hath been, the usual and constant practice of the defendants, and of some other insurance companies in the city of Baltimore, when applied to for insurance on vessels cleared outfoi one port, but actually bound to another, to rec)uire from the applicants a written communication of the fac.t of the clearance or ostensible voyage in theorderof insurance, or otherwise; and Alexander M'Kim, the former president of the Baltimore Insurance Company, who among others proved the aboye usage, being asked hy tiie plaintiff’s counsel whether the Baltimore Insurance Company would have dispensed with the informa.tion being in writing .if they had been pressed so to do by the person proposed to bo insured; replied, that no case bad occurred to his knowledge, bui if such application had been m&d'>, strong reasons must have been assigned to have 0 . andured ííie ¡UjJíimore fnnurane.c Company to ac<[Uiehce *n the reduce!; all of which is mero, matter of opinion on the part of the witness as to what might have been done by the directions of the Baltimore Insurance Company upon such application. The plaiaiilfthcu read in evidence, by consent, among other evidence of that fact, the following deposition of TVillinm Furlong, roaster of the brig Betsey, with a paper thereto annexed, and therein referred to, purporting and admitted to be the rough minutes or draft of a letter of instructions from the plaintiff to Furlong, of and concerning the s:¡«¡ vo} age. The deposition of Captain William Furlong, taken the 4th of October ¡811,stated — “That he sailed out of the port of Baltimore some time in March 1T99, oil board of the brig Betsey, as master thereof, bound to Barra-cón, within two leagues of which he was captured by -a French privateer, and carried into a port two leagues to the windward of Barracón-, was there cut out by a British frigate, and carried to Jamaica. That he sailed with positivo instructions from his owners to proceed to Barracón, ami that he was going direct thereto, without any deviation, when he was captured. That he left his letter of instructions, with other papers, iu Jamaica, and that the paper hereto annexed, marked .4, contains the substance of that letter. That his letter of instruct ions from his owner; only spoke of Burrncoa as his port of destination, lift docs lint recollect whether he had two letters of instructions or ¡act. That his instructions to proceed to Barracón wcr« lu writing. That ho delivered up to the commander of the British frigate the whole of his papers, and that ao papers were concealed. That if he had been bound lo Ctífuiügma he would have been out of the course of Ins voyage when he was captured by the ¡ranch pi-kateer,” Exhibit Jl. “Herewith you,” Ac. &c. “Should Mr. Kennedy not be at B. you will call on Mr, John Elchcim, and iu hia absence on P, Casur.iajnr, and iu Isia absence to Mr. Bor&m. Yoa will let the brig re» Miña (here; grt over to Jeremie, explain the bucioesa of your voyage to John ikicarneitu, who will suggest Iho wisest plan for job to move io. Mr. ta-numjor is obi" friend, and an «¡wight, intelligent raanj he. iu the second person you will depend on, and can be of more ties to yoa that! any other in the island. The business of the small vessels are only known to Mr. Ducarnmi and Mr. Kcn-> ne.dy, you will of course let them be disposed of as Bucara neau directs. Dispatch is every thing. Herewith you have a letter to Mr. Kennedy. You will open and read it, and you will govern yourself, in case of his absence, by our directions to him. Should the intercourse be opened you shall receive the earliest information.” The plaintiff also read in ..evidence the following letter from Alexander HA Kim to the'plaintiff, dated the 18th of January 1813, MiKim being at that time the president of the Baltimore Insurance Company, to wit: “The abandonment of the cargo of the brig Betsey, Capt, Furlong, offered on the 11 tit inst. to the Baltimore Insurance Company, is rejected. The company are bound by their policy for their proportion of all expenses incurred or to be incurred in the defence of the property, which proportion of expenses they will always be ready to pay on the production of proper vouchers thereof, and any other loss or injury arising under the policy, as soon as the same can be adjusted.” The plaintiff also gave in evidence, that at the time of making the said policy, the fact that the brig had cleared out for 'Cartlia-gena, and had on board the documents describing her voyage as a voyage from Baltimore to Carthagena, was known to the defendants. The plaintiff then prayed the opinion of the court, and its direction to the jury, that if they believed the said vessel did in fact proceed on a voyage from Baltimore to Barracón at the time mentioned, and if the fact that she had cleared out for Carthagena, and had on board the said documents describing her voyage as a voyage to Carthagena, was known to the defendants at the time of making the said policy, then the said clearance, and the documents last aforesaid, cannot in law affect the plaintiff’s right to recover. Which opinion and direction the Court [Nicholson, Clu J.j accordingly gave. The defendants excepted.
2. The plaintiff having read in evidence the aforesaid deposition of PHlfiam Furlong, with the paper thereto annexed, and having so read the same to prove that the real voyage of the brig Betsey was to Barracoa, in the Island of Cuba, the defendants read and relied on the said letter and paper to prove, that the master of the brig Betsey was in- strut;;ell by the owners of the vessel and cargo, to proceed with the said cargo to Barracoa, in the Island of Cuba, » 7 , 7 and there to leave the vessel to go to the port of Jercmie, admitted to be a port or place in the Island of St. Domingo, in the West Indies, near to the port of Barracoa, and admitted to have been then, and long before and after, a port or place within the territory of the French Republic, and under the known and acknowledged authority of . France, and at the port of Jeremie to sell, barter or exchange, or otherwise dispose of in the way of commerce and traffic, the whole or some part of the said cargo, to or with some person or persons resident at the port of Jeremie, or resident at some other port or place within the jurisdiction or under the authority of the French Republic; or with the proceeds of the said cargo, or by other means, to purchase from such person or persons, so resident, the whole or some part of a return cargo for the said- owners, with intent to convey and ship the same on board of the said brig as a return cargo, or part of a return cargo. And thereupon prayed the opinion of the court, and their direction to the jury, that if the jury should believe the said facts from the said evidence, then the policy of insurance was void. Rut the plaintiff objected to the said direction, and to the competency of the said evidence for the purpose aforesaid. And the court were of opinion, and so directed the jury, that if they believed the intent and object of the voyage, and the instructions to the master, to be as above stated, that then the plaintiff* cannot recover in this action; for he cannot call upon a court of this country tq aid him in recovering a compensation for not having succeeded in an attempt to violate the laws of the country. And the court were further of opinion, that competent and sufficient matter had been disclosed by this letter, when connected with the other evidence in the case, to leave this question to the decision of the jury. The plaintiff excepted.
3. The defendants then offered in evidence the following promissory notes given by John SFFadon, & Co. and by Richard Catón and John M-Fadon, & Co. to the defendants, in discount or bar os the plaintiff’s claim, to wit: One note dated the 11th March 1799, drawn by John M'Fadon, & Co. and Richard Catón, for S3402 75, payable to the defendants, or order, six months after date. Another dated ZM August 1801, drawn by John don, & Co. for S53GS3 84, ami payable as aforesaid nine months after date. Another dated 14th January 1802, for S544 80, drawn by Richard Catón and John M'Fadon. & Co. and payable as aforesaid three months after date. Another dated 19th January 1802, drawn by the last mentioned persons, for $602 50, an'd payable as aforesaid 15 months after date. Another dated 28d September 1801, drawn as aforesaid, for glf52 75, and payable as aforesaid, fifteen months after date; and another dated July 8, 1799, for $3882 82, and drawn and payable as aforesaid, 'three months after date. The defendants then proved that the said notes were respectively signed by John M'Fadon, & Co. and Richard Catón; and that Richard Lawson, who was the partner of John M'Fadon, trading under the firm of John M'Fadon. & Co. died on the 1st of November 1803; and that John M’Fadon, mentioned in the said notes, and the plaintiff, are one and the same person; and that the plaintiff on the 1st of December 1808, having previously committed an act of bankruptcy on the 29ch of November 1808, and being then and there a person residing in Baltimore, and using the trade of merchandize, by buying and selling in gross, was duly declared-a bankrupt within the true intent and meaning of the act of Congress of the United States, entitled “An act to establish an uniform system of bankruptcy throughout the United Slates and that Thomas Caldwell arid Jlugust JJt. Swartse, were duly appointed assignees of the estate and effects of the said bankrupt, and that the estate arid effects of the said bankrupt were and became duly and according to law vested in the said assignees; and that the plaintiff, having regularly complied with the provisions of the said act oí congress, obtained his certificate of discharge in pursuance of said act. The plaintiff'then gave in evidence, that on the 24th of October 1803, he, the plaintiff, and Richard Laioson, by the name of John M'Fadon, & Co. at Baltic more, did assign, transfer and deliver, the policy aforesaid, to a certain Robert Oliver, for a valuable consideration; and that on the same day and year the said Robert Oliver, for a valuable consideration, did assign, transfer and deliver, the said policy, to a certain John F. Kennedyj and that afterwards, on the 25th of October aforesaid, the said John F. Kennedy, at Baltimore, did assign, transfer and deliver, the said policy, for a valuable consideration. to a certain Joshua.Dorsey and John Hollins, who now hold the same, and (or whose «se this action is brought. The plaintiff then objected to the satd instes being admitted ill discount and bar as offered by the defendants And the court was of opinion, that in as much as this was an opea policy, and the claim of the plaintiff was for general, uncertain, and unliquidated damages, that the said promissory notes could not be admitted in bar or discount oí the plaintiff’s action, and therefore rejected them. The dell ndants excepted.
4. The plaintiff then gave in evidence, that the brig Betsey and cargo, after being raptured as aforesaid, was carried by the captors into the Island of Jamaica, and were there by them libelled as prize, and for salvage, ill the vice admiralty court of the. raid island, and duly claimed on the part of the owners; that a part of the cargo, consisting of flour in barrels, fish in casks and boxes, od in flasks, and wine in bottles, and of the value, according to the invoice and actual price, of 85000, were sold in the Island of Jamaica, and produced the sum of 84000, which sum the plaintiff received; that the said sale took place under and by virtue of an interlocutory decree of the said court of vice admiralty, which decree is contained in the record of the proceedings of die vice admiralty court of Jamaica, which he produced in evidence. That after the said interlocutory decree, the said vice admiralty court acquitted the said vessel and cargo, aud ordered the same to be restored by a final decree, which said final decree was also ofi’ered in evidence. He further proved by the record of said proceedings, that an appeal was duly interposed from the said decree by the libellants, upon which (hesaid vessel and cargo were ordered to be given up to the plain-tiiii on his entering into a stipulation to fulfil the final decree on the appeal, '"inch he accordingly did; and thereupon the vessel, and the. residue of the cargo, were, pursuant to the last mentioned decree, of the vice admiralty court, delivered tip to the plaintiff, who thereupon and of his own accord aoid a further part oí the cargo, consisting of flour in bárrele, fish in casks and boxes, and wine in bottles, to the value of g 10,000, according to the original invoice; which said last mentioned part of the cargo produced at ihesaid sales the sum of g80Q0. That the said two- sums of 88000 and §4000, were then and there received by ihe plaintiff, and applied to his own use. The plaintiff then prajTec] the court to direct the jury, that if they believed the said facts, and if the plaintiff, under the sundry opinions of the court, is entitled in their opinion to recover, then he is entitled to recover as for a partial lass on and for the said two parts of the cargo sold as aforesaid, and each of them, by reason and on account of the said deficiency in the sums produced by the sales respectively. And the court directed the jury, that the plaintiff was entitled to recover as for a partial loss for the difference between the sum produced by the sale of that part of the cargo which was sold by the order of the court of vice admiralty, aud the actual value thereof at the port of Baltimore', but that the plaintiff' was not entitled to recover for the difference between the sum produced by the sale of that part of the cargo which was sold by the plaintiff himself, or by his agents, and the actual value thereof at the port of Baltimore, The defendants excepted to the first direction of the court, and the plaintiff’ to the second. The verdict and judgment being for the plaintiff’, the defendants appealed to this court,
The cause was argued before Chase, Ch. J. and Buchanan, Earle, Johnson, and Martin, J.
Pinkney, for the Appellants, contended
1. That the action was not properly brought; that it should have been in the names of the. persons interested; and that the release of errors in the pleadings, agreed toby the counsel in the cause, did not operate to cure the error. He insisted that this agreement did not apply to the writ. That in the construction of instruments, where technical terms are used, the law gives the meaning.
2. That the plaintiff’, being a bankrupt, the action could .not be sustained in bis name. The assignment of the policy was merely by indorsation; and it is questionable whether a policy of assmanee is that Jdnd of instrument, being under seal, which can be transferred by indorsation» In Pennsylvania, it has been decided that it cannot; though in England the doctrine is otherwise. The assignment should have equal solemnity as the original instrument. If the transfer is not legal, then the interest under the policy is in the assignees, under the act of bankruptcy, and th© action Is brought wrong; and if it is legal, and the policy was transferred by simple endorsement, then the suit should have been brought in the names of the assignees under tin* transfer.
S. That a liquidated claim due from the plaintiff to the defendants, may be set off against an unliquidated demand of the plaintiff against the defendants. lie referred to the. act of 1785, eh. 45, s. 7. Roussel vs. The Insurance Company of North Jimeriea, 1 Hinny’s Hep. 429, (and note.)
Harper and PPinder, for the Appellee, contended
1» That there was no defect in the writ, the policy being in the names of John M'Fadon, <$• Co. and all and every other person, &c. so that any person interested therein may bring a suit on it. 2 Marsh. 683. The pleadings do not show that any persons but John M'Fadon, & Co. were interested. Hut if there is error in the writ, the release of errors in the pleadings, by a liberal construction of the. agreement, will remedy it; and if the declaration states t-hat others were interested, this is expressly released by the agreement — the declaration being part of the pleadings.
2. The question with respect to the assignment of the policy is not open. The plaintiff was merely a trustee, after he had assigned his interest, for the benefit, of the persons to whom lie had made the equitable assignment, which was not affected by his bankruptcy; and the assignees under the bankruptcy had nothing to do with the trusts of the bankrupt. Whether or not the assignment was made before the bankruptcy, was an issue which the jury found in favour of the assignment. The universal practice is to assign a policy of insurance by simple endorsement, and •therefore no particular form is necessary.
3. The set-off may be resisted on three grounds — 1st The act of 1785 does not permit a defendant to offer a set-eff in an action for an unliquidated claim. No action is susceptible of a set-off unless where the demand is for a certain sum. 2d. The notes offered to be set off were rejected generally, and if there was any good reason for rejecting them, the judgment of the court below was right, although the reasons for their judgment may not be so The notes offered as a set-off' were offered ore temis, the plaintiff therefore could not plead the act of limitations to the notes, but must set it up ore Unua. The objecíia» against the set-off was general, and one may be now urged which had not been in the court below. Stí. The equila- . , . J ble assignees were not liable to any claim against the assignor without notice, and there was sso proof of notice^ Upon either of these grounds the judgment of the court below is correct.
'Pinkney, in reply.
It would not be proper to set off an unliquidated demand, because there would be two distinct issues to try. The defendant’s demand must be liquidated, but the plaintiff’s need not. The notice of the assignment of the-policy should be given by the assignees to the insurers, and not having done so, if the assignment was legal, there is nothing to prevent the set-off for antecedent claims against the assignor. If it were otherwise, great injustice would be done. It is admitted that limitations might have been set up at the trial in bar of the notes, if standing more than three years; but it must be pleaded, or it must appear in the bill of exceptions, that the notes were rejected on that ground; and it not appearing that the rejection of the set-off* was because they were barred by limitations, this court cannot notice that the rejection was on any such ground. It has ever been holden that the statute of limitations cannot be relied on, unless it is expressly shown that it is relied on. He cited Stod~ fieri v Dunlop, 2 Ilarr. Eni. 490 Stone v Rafter, 1 Harr. 4" Johns. 564; and Clarke v Magruder, 3 Harr. & Johns. 77.

Opinion:
Johnson, J.
This is an action brought on an open policy of insurance, in which the plainfiff'must not only show that the event insured against has taken place, but also establish the value of the goods insured. Had the suit been on a valued policy, proof to the first point would only have been necessary — the parties themselves having agreed oa the amount to be recovered, in the event of a recovery, when the policy was entered into.
To free themselves from the plaintiff's claim, the underwriters produced, by way of discount or set-off, several notes, joint and several, executed by the insured to them. These notes were, by the decision of the court below, rejected, because the policy being open, the extent of the plaintiff's claim was uncertain — dependant on the real value of the goods insured.
In all instances of controverted claims on policies of insurance, ¡lie demand, in one sense, must be uncertain; for . . it being a question whether the underwriters are responsi" bie. a decision on that subject must be first obtained, before the extent of the claim presents itself — in the valued policy, that lias been agreed on-in the open policy it must be established by proof, it is then on account of the un-fceriaiuty as to the extent of the claim, and not the uncertainty of the claim itself, that the notes were rejected: for as the decision appears to be founded on the policy being open, had it been valued, a contrary decision would have been pronounced.
This is the first time, within my recollection, where this question has presented itself for the decision of this court, and it must depend on the true construction of the act of J785, ch. 46, in virtue of which the discounts were attempted to be made.
It would seen! but just that mutual claims should be set off, one against the other; that neither should be compelled to pay, when the sum so paid must be refunded on a judgment rendered on the adverse claim. Reasonable as this is, the common law, (if 1 may so term it,) excluded all .such payments, and the parties were left to their mutual .remedies at law by distinct suits, or one of them must resort to a court of equity to have his claim set off or dis-< -counted from his adversary's judgment.
in this situation were claims of this description left until the time of Geo. IT, in the second year of whose reign a law passed permitting "mutual debts between the plaintiff and defendant" to be set off, one against the, other. This statute contains no other description as to the nature of the debts, exeepi that they are "mutual" — -whether of equal or superior nature as to their origin — whether the ©ne was on a specialty, and the other on a simple contract, made uo difference, except the word "mutual" must restrain them to debts of the same nature. The courts having so long rejected defences of this description, after the passage of this remedial statute, they restrained its operation as far as practicable, and would permit no debts to be discounted, except of the same grade. The legislature of Great Britain again interposed, and in 8 Geo. II, passed another statute permitting discounts, "notwithstanding they were of different natures."
These two statute* having passed before the separation uf this country from Great Britain, did or did not form a ^ , part of the law of Maryland at the time of the revolution5 jf t^ej <1 icl, who can believe the legislature of this state, in the year 1785, would solemnly have passed an act, which was to have no effect? If they did not, as the construction on those statutes was well known, if no more was intended than was embraced by them, can it be conceived that an intelligent legislature would not have adopted the language of those statutes which were known fully to comprehend those objects? Put the act of 1785 varies materially from those statutes, and therefore the decision on them, by any rational rule, of construction, canuot be solely applied to it.
It has been remarked, that claims, under policies of insurance, as well as claims of every other description, must be uncertain in one sense; that is, whether any claim to any amount exists; if it doth exist, then, and not before, the extent of the claim presents itself. Debts' of every description, whether they arise on specialties or simple contracts, are in the same predicament — the instrument must first be proved, or the contract must be proved, before you can examine into the amount of the claim. Nor does it necessarily follow that the instrument, under which the claim is founded, when proved, must disclose on its face the extent of the claim, or that, when resting on simple contract, the contract, when proved, must produce the same-result.
Even under the English statutes the contract proved is only introductory to the extent of the demand which may be ascertained by evidence not appearing in the contract, and when ascertained, either by confession, or on demurrer to a plea, setting forth such a claim, or by proof, if contested, and in either case is a claim sufficiently certain and ascertained to be deducted from the plaintiff's demand.
In Fletcher vs. Dycke, 2 T. R. 32, the claim arose from not having done certain work within a certain given time, under a contract, stipulating that For each week after the expiration of the stipulated time, a specific sum was to be paid; the time that had expired was necessary to he averred, and if not admitted, must of course have been proved.
In (he case of a simple contract, whether for work and labour done, on a quantum meruit, or goods sold on a qunn- turn valebant, the contracts under which the work was done, or the goods sold, must be proved or inferred, and when proved or inferred, yet the extent of the claim rests on other evidence* — the value of the work, or the worth of the goods. In the case of an open policy, that being proved, the loss warranted against being ascertained, what remains more to be done than on the quantum valebant, that is, to ascertain the value oí the goods — in the ope instance sold — in the other insured; and, so far as that ascertainment, surely in the one instance, as well as in the other, the extent of the claim is unliquidated. And yet who can doubt but that a set oil" on the quantum meruit ox valebant, would be allowed.
No reason can be urged why a person who has an uncertain claim, should be permitted to recover from him who bad a certain demand. If any difference ought to be made it should be in favour of that which is certain; for a great length of time might be necessary to ascertain the one, and perhaps it might totally fail for the want of proof, and therefore it might be unreasonable to compel the certain creditor to await the termination of the uncertain demand on. Mm. But if he thinks proper to retain his certain, demand to meet that which is uncertain, why should he be prevented? He ought not to be prevented, unless, the act positively directs it. Recur to that act, and not a word is. to be found on the subject of liquidated or unliquidated claims, or debts .of any description; its language is general, "that in case any suit shall be brought on any judgment, or- on any bond, or other writing sealed by the party, and the defendant shall have any demand or claim against the plaintiff, upon judgment, bond, or other instrument under seal, or upon note, agreement, assumpsit, or account proved, as by this act is allowed the defendant, or otherwise according to law, shall be at liberty to file his account in bar, or plead discount to the plaintiff's claim, and judgment shall be given for the plaintiff for the sum only which remains due after just discount made; provided the sum which shall remain due, after such discount, be sufficient to support a judgment in the court where the cause may be tried, according to its established jurisdiction; and in all cases of suits upon simple, contracts, the defendant may file an account in bar, or plead discount of any claim he may have against the plaintiff, proved as aforesaid, or otherwise proved according to law, which may he of an equal or superior nature to the plaintiff's claim, and judgment. shall * 1 ° ° be given as aforesaid."
As the courts have adjudged that their jurisdiction remained, without regard to the sum found due, on all contracts not expressly found to be within the act limiting the jurisdiction, the proviso in the act of 1785, ch. 46, s. 7,-it is said, roust restrain the general expression in the enacting part of that act, and confine it to such contracts, the jurisdiction over which depended on the amount of the claim. In construing every instrument of writing the whole must be taken together, and no interpretation, if possible tobe avoided, should be given, that tends to render any of the provisions nugatory, much less the whole of them; and we have seen, that restraining the words of the act of 3785, so as to exclude the discounts in question, would make the general and comprehensive expression of that act useless, by limiting the right to discount to those cases that had been provided for by the statutes of George, or by the act of this state passed in 3729, ch. 20, s. 5. If, therefore, we were driven to the necessity of excluding all effect to any part of the act of 1785, the proviso must yield to the enacting part, and not it to the proviso. But in giving the opinion which has been pronounced, no such dilemma presents itself. For if the jurisdiction of the court on some. contracts depends on the sum found due, and on others the authority remains to adjudicate without regard to the sum, then it follows, that on all such contracts, where the jurisdiction rested on the sum due after the discounts made, if those discounts reduced the claim below the-jurisdiction, the judgment must be for the defendant; but where the contract, on which the suit was brought, was of a different description, there the plaintitf must have judgment for the sum due, without regard to the amount. And whether the contract sued on was of the one description or the other, must be determined by the court, as it has to da in ail cases where the sum found due by a jury, or otherwise, is under the ordinary limits.
By a liberal and extensive construction of the act, the object and policy of the law is advanced by enlarging the description of those claims against which discounts were to be admissible; and if it is not just to permit one man to recover a sum of money from another, to whom he is bable, for a libe sum, so is justice promoted by extending the power of discount. For if the right to discount does not exist, then it is in the power of a person who has a claim, to transfer that claim, and enable the transferrce to rerover the sum due, notwithstanding he, from whom the claim was obtained, never could have forced a payment of the money! for in his hands, cither at law or in equity, it 'must have been subject to all demands on contract against him. whether those demands arose on contracts even ber tween the same, or other persons. But it the defendant is not permitted at law to discount, neither could he, it is apprehended, 'nave redress in equity, where the claim has! been transferred to a third person, who had no notice at the time he received the assignment. A more striking instance of the injustice of restraining discounts cannot be conceived, than the case now before the court presents.The underwriters having fixed, ascertained, and just claims on the assured, must notwithstanding be compelled to pay the money to his assignees, when the assignor him— self could never have coerced the payment; for against him, most assuredly, at equity, relief might have been. obtained, and the one demand set off against the other. By permitting the discounts at law hir> assignees wil', as they ought, stand iri his place, and be liable to the same objections against the payment of the money that might have been made against their assignor.
The Court concurred in the opinions of the County Court in the fir at and fourth bills of exceptions, am5, dissented from that jn the third bill of exceptions. The second bill of exceptions having been taken by the plaintiff below, did not come under the consideration of the court