Case Name: Bunnell v. Empire Laundry Machinery Co.
Court: New York Supreme Court, General Term
Jurisdiction: New York
Decision Date: 1889-05-27
Citations: 5 N.Y.S. 591
Docket Number: 
Parties: Bunnell v. Empire Laundry Machinery Co.
Judges: 
Reporter: West's New York Supplement
Volume: 5
Pages: 591–593

Head Matter:
Bunnell v. Empire Laundry Machinery Co.
(Supreme Court, General Term, Third Department.
May 27, 1889.)
:1. Contracts—Parol Evidence.
_ A., a member of a firm indebted to plaintiff, executed a writing by which, in consideration of certain machines, a note for §2,500, “and for other good and valuable considerations, ” he sold and assigned all his interest in the firm to defendant corporation, “and hereby release said corporation from all claims upon it. ” At the same time S., his partner, who was an officer of defendant, gave him a writing, signed by S., as follows: “I hereby agree to assume [plaintiff’s] bill for June, 1883, and such part as now remains unpaid. ” Plaintiff claimed that the latter agreement was the other considerations referred to in A.’s agreement, and that S. signed it as agent for defendant. Meld, that evidence of the conversations which resulted in the execution of these agreements was inadmissible.
■2. Principal and Agent—Contract for Benefit of Agent.
S., as a partner, being personally liable for plaintiff’s claim against the firm, .could not make a contract as agent for defendant, binding the latter to assume its payment.
8. Contracts—Consideration.
A mere admission of liability for, or a promise to pay, the debt of a third person, no consideration therefor being shown, is not binding.
Appeal from judgment on report of referee.
Argued before Learned, P. J., and Landon, J.
M. T. & L. G. Hun, for appellant. Ward & Cameron, for respondent.

Opinion:
Learned, P. J.
In February, 1883, Adams, Shorev, and Everhart formed -a partnership under the same name with that of the defendant. That partnership had become indebted to plaintiff in the sum of $1,044.90 prior to July, 1883. About July 16, 1883, the said persons and one Porter entered into an agreement of that date by which Shorey was to organize a corporation in Massachusetts. A part of that agreement was that such corporation should assume the liabilities of that partnership and of another partnership if their liabilities were exceeded by the assets, which assets were to be assigned to the -corporation. Such corporation was soon after organized, and is the defendant. The plaintiff has a claim against the defendant for goods subsequently sold at $96.23, which is not disputed. The plaintiff also claims to recover of defendant the indebtedness owing by the aforesaid partnership. It is not shown that the assets did exceed the liabilities of the partnership, and the referee finds that by plain tiff's stipulation no claim was made for recovery under the aforesaid agreement. The referee, however, finds that in consideration of a certain subsequent agreement made December 18, 1883, the defendant promised to pay his indebtedness of the partnership to plaintiff, and that aft.erwards, at various times, defendant promised to.pay said indebtedness. The agreement of December 18, 1883, is as follows: "Troy, H. Y., December 18,, 1883. For the machines in my store, and for twenty-five hundred dollars, the receipt whereof is hereby acknowledged, and for other good and valuable-considerations, I hereby sell and assign all my interest in the Empire Laundry Machine Company copartnership to the Empire Laundry Machinery Company corporation, and hereby release said corporation from ail claims upon it. I further hereby, in consideration of George L. Shorey indorsing the said note-of said corporation for the above sum,-release said Shorey from all obligations to me whatever. A. P". Adams." Thereupon Shorey, who was secretary, treasurer, and clerk of defendant, gave Adams the machines referred to and the defendant's note for $2,500, since paid. Adams testified that the other good and valuable consideration mentioned in the paper was an agreement that the defendant ossu me the Bunnell debt, now in dispute. Shorey testifies that the clause did not refer to any such agreement, and that no such agreement was made. A writing in these words was proved and offered in evidence by the plaintiff: "December 18, 1883. I hereby agree to assume Bunnell's bill for June, 1883, and such part as now remains unpaid. George L. Shorey."' This was objected to by defendant, among other grounds, because it was the individual obligation of Shorey, and not binding on the defendant, and it was excluded. This paper, Adams testifies, was drawn up and delivered to him by Shorey at this time on his asking Shorey for a written agreement to pay Bunnell's account. This written agreement, with the other, of the same date, constitute the written evidence of the contract between the parties.- As such they superseded all the verbal negotiations. As this agreement, signed by Shorey, was excluded partly on the ground that it was not the act of the defendant, it was not proper to receive evidence of a conversation tending to show a-n agreement with the defendant, and not with Shorey. The writings were the contract, and excluded evidence of the conversation of which the contract was the result. Adams accepted this writing signed by Shorey as the agreement for which he had negotiated, and if the words "other good consideration" refer to any agreement to assume tile Bunnell account,' this paper must have been such agreement. Whether or not, by proper evidence, this written agreement might be shown to be defendant's act, we do-not decide. The agreement was excluded and the prior conversation was admitted. We think that this was incorrect. Again, the consideration, received by defendant under this agreement was the assignment to it by Adams of his interest in tile partnership, and his release of all claims. How, by the agreement of July 16th, the assets of the partnership were to be assigned to-the corporation, so that it is difficult to see what interest Adams had to assign, especially as it does not appear that the assets exceeded the liabilities; nor do we see what claims he had against the defendant to be released. Adams testifies that this claim of the plaintiff was against him individually; but under the partnership agreement it would seem to be a partnership liability, and tile referee finds that it was such. If so, then tile alleged agreement was made by Shorey, the agent of the defendant, binding it to assume a debt which lie personally owed. Such an- agreement is contrary to the rule that an agent cannot bind his principal to a contract with the agent personally. That is, one cannot act on each side of a contract. This alleged contract made the defendant assume a liability for which Shorey was liable as.an original party. Several letters of the defendant are produced, some prior and some subsequent to the agreement of December 16,1883. There are some prior to that date which may be construed as an admission of liability. Still, those are not binding, because there is a lack of proof of consideration, and the mere promise would not be binding. Those subsequent seem to refer to the written agreement above mentioned, and to the liability therein assumed. We think, therefore, that the defendant is not shown by these letters to be liable to plaintiff, for we cannot say that the agreement of July, 1883, shows a consideration forthe alleged, promise in the letters, because the stipulation forbids. We do not think it necessary to inquire whether the alleged promise of defendant to pay the debt owing to plaintiff was in such sense original that it was not within the statute of frauds, because, as we have already said, it seems to us upon the evidence that the promise (whatever it was) was contained in the writing signed by Shorey, and that that writing cannot be disregarded and a promise made out from the conversation which led to that writing. For the same reason we do not discuss the question whether this case is within Lawrence v. Fox, 20 N. Y. 268, so as to allow an action by the plaintiff on the promise made to Adams. Certainly, this is widely different from that in the circumstances, and there is no desire to extend the principle of that case. The judgment should be reversed; a new trial' granted; referee discharged; costs to abide event.