Case Name: Thomas Burch against Newbury and another
Court: New York Court of Appeals
Jurisdiction: New York
Decision Date: 1852
Citations: 10 N.Y. 374
Docket Number: 
Parties: Thomas Burch against Newbury and another.
Judges: 
Reporter: New York Reports
Volume: 10
Pages: 374–397

Head Matter:
Thomas Burch against Newbury and another.
The defendants, exchange brokers at Chicago, in April, 1845, agreed to terminate their partnership on the first of May following. On the thirtieth of April, one partner having formed a new partnership with the plaintiff to continue the business from the first of May, settled with his former partner, and in the settlement canceled two notes of the old firm, amounting to $10,000, which had been taken up by the members of the new firm, and received therefor from the old firm a draft payable to the order of the new firm for $3000, on J. T. Smith & Co., of New-York, correspondents and agents of the old firm, and an order for certain drafts ( or their proceeds ), which had been sent by the old firm to Smith & Co. for collection. The draft and order amounting to near $11,000, covered all the asset's of the old firm in the hands of Smith & Co., and exceeded the amount of the two notes and interest, $940.93, for which sum the note of the new firm was given to the old. The new firm, on the first of May, transmitted by mail from Chicago, to Smith & Go., at New York, the draft and order, with instructions to place the amount of the draft to their credit, and to hold the paper mentioned in the order for collection for them. Smith & Co., acknowledged the receipt of the draft and order on the ninth of May, by mail, saying they had placed the $3000 to the credit of the new firm, but had not then time to examine the accounts of the old firm as to the order. This letter by mail could not reach Chicago until after the sixteenth of May. No other demand was made by the new firm upon Smith & Co. for the $3000, or the drafts, until after May sixteenth, when Smith & Co. failed, having previously received the avails of all the drafts, except $1000. They were insolvent on the thirtieth of April, but were in good credit, arid paid all demands upon them until their failure. The bill in this cause was filed by the incoming partner, against the members of the old firm, to compel the retiring partner to pay to the new firm one-half the amount of the two notes and interest:
Held, that the old firm was not liable to the new, for the losses sustained by the failure of Smith & Co.
That the only guaranty on the part of the old firm was, that the things which they assumed to transfer were in fact what they described them to be.
That if the guaranty extended further, the new firm had made Smith & Co. their agents, and assumed the risk of their responsibility.
The provision, in § 460 of the Code of 1849, authorizing an appeal “ in any suit in equity pending in the supreme court on the first day of July, 1847,” must be construed as authorizing appeals in suits in equity pending in that court on tho first Monday of July, 1847; such construction being necessary to give any effect to the statute, as no such causes could be pending in the supreme cuirt, under the constitution of 1846, prior to the last mentioned date. Per Jewett, J.
The act referred to, so far as it authorized an appeal from a decree where the time previously allowed for appealing had expired, and the decree had been executed, although not affected by the provisions of the United States constitution prohibiting states from passing ex post facto laws, or laws impairing the obligation of contracts, is in conflict with the provision of our state constitution, declaring that no person “shall be deprived of life, liberty or property without due process of law,” and is therefore void. Per J ewett, J.
A statute which contingently deprives a person of property, the right to which was perfect under prior laws, is within the prohibition of the constitution. Per Jewett, J.
In Equity. Appeal by the plaintiff from the decree of the supreme court, rendered in the fifth district, affirming the decree pronounced by G ridley, J., at special term, dismissing the bill of complaint. (1 Barb., 648.) The bill was filed in 1846, before the chancellor, and was transferred under the constitution of 1845, to the supreme court. The case made by the pleadings and proofs was as follows:
Prior to the 1st day of April, 1845, the defendants, Walter L. Newbury and Isaac H. Burch, had been engaged in the business of exchange brokers in the city of Chicago, as copartners under the name and style of Newbury & Burch, and so continued until the thirtieth of April of the same year, when they dissolved their partnership and closed their business.
In the course of their business as such exchange brokers and on the 1st day of July, 1843, they gave two notes of $5000 each, with T. Burch & Co. as surety, payable on demand, one to the order of A. Gr. Story, cashier, at the Herkimer County Bank, with interest at the rate of three per cent, per annum, from the thirtieth day of June previous, which was afterwards, by stipulation, reduced to two and a half per cent from December 13th, 1843; and the other, payable to the order of Watts Sherman, cashier of the Albany City Bank, with interest at the rate of two and a half per cent per annum, from the twelfth day of June previous. For these notes they received the respective amounts thereof from the banks mentioned, in their bank notes, which were used and circulated in the business of Newbury & Burch, at Chicago. These bank notes were marked, so that they could be recognized, and when they came in for redemption, Newbury & Burch provided funds for that purpose, and cohtinued to circulate and redeem them, down to the time of the dissolution of their partnership on the 30th day of April, 1845.
Shortly before the 1st of April, 1845, Newbury & Burch •agreed that their copartnership should be dissolved on or about the first of .May following. About the first of April of the same year, Isaac H. Burch came to this state, and while here made two notes of $5000 each, one payable to the Albany City Bank and the other to the Herkimer county bank, which were signed by himself and by T. Burch & Co. as surety, both on demand, with interest at the rate of two and a half per cent per annum — which were discounted at such banks, and the proceeds used by Isaac H. Burch in paying and taking up the two former notes of Newbury & Burch of the same amounts and" at the same banks. When I. H. Burch paid the two notes of Newbury & Burch to the banks, of $5000 each, they were endorsed by the banks as paid in full by I. H. Burch. On the 5th day of April, 1845, the plaintiff and the defendant, Isaac H. Burch, entered into an agreement of partnership in words and figures following: “ Memorandum of an agreement made this 5th day of April, 1845, by and between Thomas Burch, of Little Falls, Herkimer county, New-York, of the one part, and Isaac H. Burch, of Chicago, Illinois, of the other part, to form a copartnership for the transaction of the banking and exchange brokerage business in the city of Chicago, Illinois, on the following terms and conditions:
“ 1. The style and name of the firm shall be, ‘ I. H. Burch & Co.’
“ 2. Each party shall be equally liable for two notes of ( $5000) five thousand dollars each on interest at two and as half per cent (2¿) per annum, da.ted April 1st, 1845, signed ‘I. H. Burch,’ and ‘T. Burch & Co.,’ surety, made payable, one to the Albany City Bank and the other to the Herkimer County Bank, and for all notes that shall be given to renew the same, and the proceeds of said two notes shall be used in the business of the company.
“ 3. The business of the firm shall be transacted by Isaac H. Burch, who shall reside at Chicago, and the name of the firm shall not be used in any manner except in the business of the company.
“ 4. Said Isaac shall devote his time to the business of the company, and receive as compensation for his services a yearly salary of one thousand dollars.
“ 5. All necessary expenses for conducting the business shall be paid by the company, and the profits and losses shall be shared equally by each party.
“6. This agreement shall take effect on the first day of May, 1845. “ Thomas Buiioh,
“ Isaac H. Buech.”
After the execution of this agreement, Isaac H. Burch returned to Chicago with the two notes of Newbury & Burch, of $5000 each, which he had taken up from said banks, and on the 30th day of April, 1845, he and Newbury had a settlement, and an account was stated in which New-bury & Burch were charged with the two notes last mentioned, with a small amount of interest on each, and also with I. H. Burch & Co’s, note on demand for $940.93, amounting in all to $10,961.48; and in which Newbury & Burch were credited with their draft on John T. Smith'& Co., to the order of I. H. Burch & Co., for .$3000, and an order on said Smith & Co. for certain drafts previously transmitted to their house for collection, amounting to $7961.48, which, with the draft of $3000, just balanced the debits in that account. The order was as follows:
“ Chicago, April 30, 1845.
“ Messrs. J. T. Smith & Co., New York,
“Gentlemen, please deliver to I. H. Burch & Co., or order the following described drafts, or their avails, which you have received from us for collection.”
Then followed a description of the drafts, all of which would mature at various dates from the twenty-third of May to the sixteenth of June following. The draft fo.r $3000, the order for the collection paper and the note of I. II. Burch & Co., stated in the account, were made at the same time; and the draft and order on Smith & Co. were delivered to I. H. Burch, and the note of I. H. Burch & Co. delivered to Newbury; and at the same time I. H. Burch wrote across the face of both of the two $5000 notes of Newbury & Burch a receipt of $5000, in full, and signed his individual name to the receipts. The account mentioned, as first drawn, commenced as follows: “ Newbury & Burch, in account with I. H. Burch & Co.,” but the words “ & Co.,” were obliterated by I. H. Burch at the same time.
On the 1st day of May, 1845, the new firm of I. H. Burch & ■ Co. commenced business at Chicago, in pursuance of their articles of partnership, and on the same day transmitted the draft of $3000, made by Newbury & Burch, by mail, to John T. Smith & Co., who had for sometime previously been the corresponding agents of Newbury & Burch in the city of New York, and on the same day they again wrote to Smith & Co., enclosing the order together with other drafts for collection, directing the sale at once of two $1100 drafts mentioned in the order, and referring to the $3000 draft of Newbury & Burch, sent that morning; and concluding as follows:
“The above draft of Newbury & Burch is, by their books, the balance they have left with you. Should it not prove so, we will adjust all discrepancies where they are in error. Should their draft of $3000, sent you by last mail, not reach you in due time, you will make the transfer, and advise us at once. Please acknowledge to us the receipt of the paper called for by their order, specifying the items and time of maturity, and hold them for collection for our account. You will direct your Boston and Philadelphia correspondents to pay our drafts on you, and advise us how to draw on those points..
“ Respectfully yours, &c.,
“ I. H. Burch & Co.”
The order of Newbury & Burch for the collection paper, and their draft for $3000, were received by John T. Smith & Co., on the eighth or ninth of May, and on the ninth Smith & Co. wrote I. H. Burch & Co., acknowledging the receipt of their previous communications, together with the order and draft, and concluding as follows : “ We have not time to-day to examine N. & B. order for the paper; will report in our next. We wrote you on the seventh inst., advising yours of the first.”
Thomas S. Underhill, a witness for the plaintiff, testified that he was a member of the firm of John T. Smith & Co.; that the draft for $3000 was passed to the credit of I. H. Burch & Co. by their directions, by J. T. Smith & Co.; that if it had been presented by any party not having an account with them, the money would have been paid ; that the firm of J. T. Smith & Co. was not required to pay to any one the avails of the paper mentioned in the order, or to deliver said paper, or any part of it, prior to May 16th, 1845, except by the order itself and the letter enclosing it, (an extract from which and all that relates to the order is given above); that the house of John T. Smith & Co., in New York, was in good and full credit, doing business as exchange brokers and bankers, paying all demands made upon it up to 'the 16th day of May, 1845, and would have paid any drafts of Newbury & Burch to the amount of the said order in the hands of third persons at any time before that date, without reference to how the account stood between them; had the order, in the shape it was sent, been presented at their counter by a third person (such a thing being unusual, and never happening between them before), they would have taken time to examine the account of Newbury & Burch before they would have paid it, for the reason that it was out of the regular course in which they did business; if they found the account good, they would have paid the avails of the paper mentioned in the order, although the house of John T. Smith & Co. was insolvent at the time, but it was paying all demands upon it, owing to its good credit; that the house was in the habit of selling any paper they received from Newbury & Burch, without waiting for special instructions, and the latter never complained of it; that the paper mentioned in the order was all sold by this house before the receipt of the order, except one draft of $1000, which I. H. Burch & Co., afterwards received.
I. H. Burch, who was also examined as a witness, among other things testified that the order was drawn by Newbury & Burch for the paper, or its avails, in order to provide for ■the contingency of its having been sold.
It was admitted by a stipulation between the attorneys for the respective parties, that the house of J. T. Smith & Co. were employed as the agents in New York of the firm of I. H. Burch & Co. in like manner as they had been the agents of Newbury & Burch; and said house of J. T. Smith & Co., continued in business, in good credit, until the morning of the 16th of May, 1845, when they stopped, doing no business on that day.
That the two notes signed by Isaac H. Burch and T. Burch & Co., surety, of $5000 each, mentioned in the articles of partnership of I. H. Burch & Co., were made and used in contemplation of such partnership, and for the purpose of taking up the two previous notes of Newbury & Burch of $5000 each, produced by I. H. Burch on the dissolution between him and Newbury.
It appeared that nothing was ever received by I. H. Burch & Co., on account of the order of Newbury & Burch, upon Smith & Co., for the drafts, excepting the draft of $1000 which had not been sold, as before stated.
The object of the suit was to compel the defendant, New-bury to pay over to the plaintiff, one-half of the amount remaining due on the drafts mentioned in the order, which were sold by J. T. Smith & Co. The case contained various other facts, but the foregoing statement embraces substantially all that is necessary for a proper understanding of the rights of the parties. The facts relating to the question of practice discussed by Jewett, J., are fully stated in his opinion.
H. Denio for the appellant.
F. Kernan for the respondent.

Opinion:
Welles, J.
Assuming that on the 30th of April, 1845, when Newbury & Burch dissolved their copartnership at Chicago, Isaac H. Burch and Thomas Burch were joint owners of the two notes made by Newbury & Burch, and which I. H. Burch had shortly before taken up of the banks which had discounted them, and that I. H. Burch and Thomas Burch held them as creditors of the firm of Newbury & Burch, I am unable to perceive anything in the case to charge the firm of Newbury & Burch, or either of its members, in favor of the plaintiff, legally or equitably, with any part of the loss which subsequently arose upon the failure of the house of John T. Smith & Co. The firm of Newbury & Burch had been carrying on the business of exchange brokers at Chicago, and continued such business up to the time of their dissolution. An important branch, if not the principal part of their business, was selling sight drafts on the city of New-York and other distant places, and buying time drafts upon the same. It was indispensable to the success of such business that an agency be established in New-York provided with sufficient funds for the purpose of duly honoring and promptly paying their drafts. They had accordingly made arrangements with the house of John T. Smith & Co., of New-York, with that view. At the time of the transaction, when their partnership was dissolved, they had, as they supposed, in the hands of Smith & Co., funds for which they could draw at sight, to the amount of $3000, and drafts on time which they had purchased and forwarded to them for collection, and which would mature at various periods from the fifteenth of May to the thirteenth of June following, equal in value to $7961.48, which Smith & Co. were authorized to sell, if necessary to keep their accounts good, and against which they could also draw, if necessary. Smith & Co. were in good credit, paying all drafts which Newbury & Burch made upon them and had proved prompt and valuable correspondents. This firm was being dissolved, to be succeeded the next day by the new firm of I. H. Burch & Co., in the same business, at the same place. It would be natural, therefore, that Isaac H. Burch, who had been one of the old firm, and who was to be one and the active business member of the new firm, should desire to secure to the latter the advantages of these New-York facilities; and that he would regard the funds in the hands of Smith & Co. more beneficial to the new firm than the same amount of specie in Chicago. It is certainly not to be supposed that either Newbury or I. H. Burch considered these funds or this credit with Smith & Co. of any less value than that at which they were estimated in the transaction between them. Newbury was retiring from the business, and had no motive to retain an interest in them. The arrangement was accordingly consummated. The two $5000 notes were canceled, and the New-York funds transferred by Newbury & Burch to I. H. Burch & Co., and the next day the firm of I. H. Burch & Co., which then came into existence, took up the business as Newbury & Burch had left it, and carried it on, as they had done, with the house of Smith & Co., until that house failed on the sixteenth of the same month. Up to that day Smith & Co. were in full credit, paying all drafts properly made upon them. The $3000 draft of Newbury & Burch to the order of I. H. Burch & Co., and the order for the drafts previously sent by the former to Smith & Co. for collection, were received by Smith & Co., on the eighth or ninth of May, and the draft placed to the credit, on the books of Smith & Co., of I. H. Burch & Co. So far, all was satisfactory to I. H. Burch & Co. It was precisely what they wanted. With respect to the order, they did not desire to get the drafts to which it related out of the hands of Smith & Co. into their own, but wished merely to be placed in the same relation to them which Newbury & Burch had occupied, and to that end they directed J. T. Smith & Co. to hold them for collection for their account, as they had done for Newbury & Burch. There is no reason to doubt that Smith & Co. would have paid over to I. H. Burch & Co. the amount of chose sold if they had been requested to do so, and delivered the one which had not been sold, upon like request, any time after the order was made, and before they stopped business. But this I. H. Burch & Co. did not desire. They had no motive for changing their New-York correspondents and agents. If they had, there was time enough, after they received the order1, and before the failure of Smith & Co., to have done so. They retained Smith & Co., as their agents, voluntarily, and at their own risk. No fraud or bad faith is chargeable to Newbury, and there is nothing in the case to justify an inference that Newbury & Burch, or either of them, were expected, or intended, or did in fact in any way guarantee the responsibility of -Smith & Go.; and there is evidence which, to my mind, is abundant to show that Newbury & Burch were to be entirely discharged from the two $5000 notes; and if that was the understanding, there is nothing left of the plaintiff's claim.
Admitting that the transaction at Chicago on the thirtieth of April, respecting the two 85000 notes of Newbury & Burch, and their draft and order on J. T. Smith & Co., is to be regarded as between I. H. Burch & Co. of the one part, and Newbury & Burch of the other, Isaac H. Burch is to be deémed as acting, and duly empowered to act, for himself and the plaintiff. It was, in substance, a purchase by I. II. Burch & Co. of the New-York city funds, with a view, to their future business, aud clearly within the scope of their partnership. No doubt can be entertained, that all the title and interest, both legal and equitable, of Newbury & Burch in and to the drafts mentioned in the order, or, if any of them were sold, in and to the proceeds of the sales in the' hands of Smith & Co., were, by force of the order and the concurrent acts of the parties connected with it, completely transferred to and absolutely vested in Isaac H. Burch and the plaintiff, who thereby succeeded to all the rights of Newbury & Burch to the drafts and their avails. The operation of the order was an equitable, and I think a legal, assignment to I. H. Burch and the plaintiff of the drafts specified in it, and their avails, in the hands of Smith & Co. The only guaranty on the part of Newbury & Burch which could on any principle result or be implied from the transaction, was, that the demand or thing assigned was what it purported to be, a valid, subsisting demand. Upon that subject, there is nothing in the allegations or proofs to show the contrary, or that any sufficient reason existed why Smith & Co. should not comply with the requirements of the order.
In case an action should become necessary against Smith & Co., to recover the drafts or their avails, or against the parties liable upon the drafts not sold to collect their amounts from such parties, Isaac H. Burch and the plaintiff would be the proper persons to make plaintiffs in such action. The order was not a bill of exchange, being drawn, not for money generally, but for the specific drafts mentioned ; or, in the alternative of the drafts or any of them having been converted into money, then for the payment of that money. A bill of exchange in its proper, legal sense, is for the payment, at all events, in money of a sum certain, and must not be in the alternative, or payable out of a particular fund; and in order to give the holder a right of action upon it, against the payee, must be accepted by the drawee. None of these characteristics appertain to the order in question. If it had been a bill of exchange, in the sense described, it would not have operated as an assignment of any funds in Smith & Go's, hands, to I. H. Burch & Co., and the only way in which Newbury & Burch, the drawers, could have been made liable upon it would have been by a regular protest for non-acceptance or non-payment, or something equivalent thereto. I have remarked that Isaac H. Burch and the plaintiff would be the proper parties' plaintiff in an action against Smith & Co. to recover the drafts or their proceeds. By this I do not mean that an action would lie in their favor upon the order, but that they could maintain it as purchasers and assignees of Newbury & Burch of the drafts, or the moneys received upon their sale by Smith & Co. It would have been the duty of Smith & Co., after they received the order, or had notice of it, to hold the drafts or their proceeds, if all or any of them were sold, in special deposit, subject to the order of I. H. Burch & Co.; and equity will hold, that what should have been was done — and if that was done, Smith & Co., would be regarded, in relation to the drafts or their proceeds, as holding the relation of bailees of I. H. Burch & Co. only, and none whatever to Newbury & Burch.
The case was ably examined in the supreme court, and the decision, dismissing the bill, was placed upon several grounds. The view I have presented seems to me to be the most favorable that can be taken for the plaintiff; and if I am correct, he has shown no ground for any relief against the defendant Newbury, who alone defends; and the bill, as to him, was properly dismissed.
I think the judgment of the supreme court should be affirmed, with costs.
Jewett, J.
On the argument the counsel for the defendant insisted that the court should review the order made by the supreme court, denying the motion made in that court in November, 1849, to dismiss the appeal in that court, it being an intermediate order involving the merits and necessarily affecting the judgment.
Preliminary to the argument on the merits, that question was discussed; but a decision of it was finally reserved, and the argument, on the merits of the cause, proceeded. It is proper, therefore, in the first place, to dispose of this question.
The facts in respect to it are substantially these: The suit was commenced in 1845, before the chancellor; was put at issue and the proofs closed by an order entered on the 30th day of June, 1847. On the second Monday of December, in the same year, it was brought to argument before the supreme court at a special term, when a decree was made therein dismissing the bill as to the defendant Newbury, with costs to be taxed, to be paid by the complainant, and was duly entered with the clerk of Herkimer county, and a copy thereof with notice of the same was served on the solicitor, for the complainant, on the 22d day of January, 1848. At a general term of the supreme court held in the fifth district in July, 1848, the complainant applied for a rehearing, which was denied, from which order he appealed to this court. In December term, 1848, the appeal was dismissed, with costs to be taxed, and on the 3d day of February, 1849, the decree was enrolled and docketed for the costs decreed, including the costs of the appeal to this court, amounting to $198.35, which subsequently in the same month was collected by an execution issued upon the decree.
On the 29th of June, 1849, notice of an appeal from the said decree so made at the special term, with the copy of an undertaking, was served on the solicitor for the defendant by the solicitor for the complainant, with a notice of argument for the then next general term appointed to be held in the fourth district on the first Monday in September then next, upon which the defendant's solicitor gave notice of a motion to be made in the same court at the same time to dismiss the appeal. The motion was made, and at November term, 1849, was denied. (4 How. Pr. R., 145.) At January term, 1850, the cause was argued at the general term of the supreme court held in the fifth district, and at the next May term, that court made a decree affirming the decree of the special term, with costs: from that decree, the complainant appealed to this court. The supreme court was organized under the act " in relation to the judiciary," passed May 12, 1847 (Laws of that year, 319), and by § 16 of that act was vested with all the powers, which the late supreme court and court of chancery possessed. By § 24 of that act it was provided that a general term of the supreme court organized by that act, should be held at the capítol in the city of Albany, on the first Monday of July, 1847, and among other things, to " establish, revise and alter the rules of said court." By § 20 of said act, the right to apply at a general term for a rehearing of such a decree as was made at the special term in this case, was conferred on the complainant, but the time and manner of making such application, not being provided for by the statute, were left to be provided for and regulated by the rules of practice to be adopted by the supreme court at a general term to be held pursuant to § 24. I have already remarked that the supreme court thus organized was vested with all the powers which the late court of chancery and supreme court possessed. It had therefore the power to prescribe the time and manner of making such application. The provisions of 2 R. S., 1.75, § 46 ; 177, § 55, 57; 178, § 67; 200, § 28, were directly applicable to the present supreme court. That court, at a general term held pursuant to § 24, adopted rules of practice, and by the 78th rule it was provided that notice of an application for a rehearing before the court at a general term might be served at any time within thirty days after service of the decree or order complained of. The motion for a rehearing was made in July term, 1848, as I have before stated, and was denied on the ground that a notice of the application, specifying the time and place of making the motion, was not served until after the expiration of thirty days from the time of service of a copy of the decree and notice. The court held that the service of such notice was an irregularity, fatal to the application, although no delay in the hearing was the consequence of such omission.
By § 7 of the act to facilitate the determination of existing suits in the courts of this state, passed April 12,1848, which, with the exception of § 2, took effect on that day, it was provided, among other things, that no rehearing should be had at a general term of the supreme court, of an order or decree made at a special term, unless notice of the same should be given within two days after notice of the order or decree to be reheard. This provision is continued in § 7, of a similar act passed April lltli, 1849. (Laws 1849, 707.)
It was not claimed by the counsel for the complainant that the appeal from the decree made at the special term had been taken in pursuance of any of the provisions of the judiciary act of 1847, or of the act to facilitate the determination of existing suits to which I have referred, but under the provisions of § 460 of the Code as amended by the act of the 11th of April, 1849. {Laws of that year, 703.) That section provides that " an appeal may be taken from any final decree entered upon the direction of a single judge, in any suit in equity, pending in the supreme court on the first day of July, one thousand eight hundred and forty-seven, within ninety days from the time this act shall take efiect; but this section shall not apply to cases where a rehearing has already been had or ordered, and such appeal shall be taken in the manner provided in section three hundred and twenty-seven and three hundred and forty-eight."
On the part of the defendant it was contended that this section did not apply to this case, because the suit, in which the decree appealed from was made, was not pending in the supreme court on the day mentioned in the law; namely, the 1st day of July, 1847. That fact does not admit of any question, for no suit which was pending either in the late court of chancery or supreme court at the time the constitution of 1846 took eifect, was transferred to the present supreme court until the first Monday (which was the fifth day) of July, 1847. ( Const., art. 14, § 5.) It was, however, insisted that § 460 should be construed as applying to such suits, although they were not pending in the supreme court until the first Monday of July, 1847, notwithstanding the words of the act; on the ground that it was obvious that the legislature intended it to have that application. It is clear that unless it can have such application, it is wholly nugatory, for there was no suit pending in the supreme court on the day specified in the act, and of course there could not be any decree made in any such suit referred to. When the words of an act are doubtful and uncertain, it is proper to inquire what was the intent of the legislature; but it is very dangerous for courts to launch out too far in searching into the intent of the legislature, when they have expressed themselves in plain and clear words. It is well settled that in construing a statute the intention of the legislature is a fit and proper subject of inquiry. That intention, however, is to be collected from the act itself, and other acts, in pari materia.
The general rules on this subject require that such construction ought to be put upon a statute as may best answer the intention which the makers had in view, which may sometimes be collected from the cause or necessity of making the statute, and sometimes from other circumstances; and whenever such intention can be discovered, it ought to be followed with reason and discretion, in the construction of the statute, although such construction seem contrary to the letter of the statute. Where any words are obscure or-doubtful, the intention of the legislature is to be resorted to in order to find the meaning of the words. A thing which is within the intention of the makers of a statute is as much within the statute as if it were within the letter; and a thing which is within the letter of a statute, is not within the statute, unless it be within the intention of the makers ; and such construction ought to be put upon it as does not suffer it to be eluded. (Bac. Abr., tit., stat. 9, 5, 10; 2 Kent Com., 462; The Watervliet Turnpike Company v. McKean, 6 Hill, 616, and the cases there cited; Dwarris on Statutes, 690, 696, 703.)
The provision made for an appeal by § 460 is sensible if applied to decrees made in suits pending in the supreme court on the first Monday of July, 1847, but entirely senseless if applied to decrees made in suits pending on the Is? day of July in that year.
If we look into the several statutes passed by the legislature, to provide for the organization of the courts under the new constitution and for the subsequent proceedings in suits pending in the present supreme court after their transfer from the late courts, by force of the constitution, it cannot, I think, b& doubted, but that § 460 aimed at such suits, and that the mistake in referring to them—as to the day when they were so transferred, until which time no suit was pending in the present supreme court—was purely clerical; I am therefore of opinion that the provision contained in that section was applicable to this suit, although not pending in the supreme court until the first Monday, the 5th day of July, 1847.
It was next contended by the defendant that § 460 was void as having been passed by the legislature in violation of art. 1, § 10, subd. 1, of the constitution of the United States. The provision referred to, prohibits any state, among other things, from passing any ex post facto law, or law impairing the obligation of contracts.
The clause, " that no state shall pass any ex post facto law, means nothing more than that the legislatures of the several states, shall not pass laws after a fact done by a person, which shall have relation to such fact, and shall punish him for having done it.
The object of the provision was not to secure persons in their private rights either of property or -contract. That provision is not applicable to civil laws, which affect private rights retrospectively, but to penal and criminal laws, which impose punishments or forfeitures, for acts indifferent in themselves when committed, by a law passed subsequently. Colder v. Bull, 3 Dallas, 386; Fletcher v. Peck, 6 Cranch, 138; Ogden v. Saunders, 12 Wheaton, 266; Satterlee v. Mathewson, 2 Peters, 380; Watson v. Mercer, 8 Peters, 110.)
The general interpretation has been, and is, as is said by the late Judge Stoby (3 Story Com. on the Const, of the U. S., § 1339), that the phrase, ex post facto laws, applies to acts of a criminal nature only; and that the prohibition reaches every law, whereby an act is declared a crime and made punishable as such, when it was not a crime when done; or whereby the act, if a crime, is aggravated in enormity, or punishment; or whereby different or less evidence is required to convict an offender, than was required when the act was committed. (1 Kent Com. 408.)
If the effect of the act in question was to divest Newbury of an antecedent vested right, but not to impair the obligation of any contract, it is not void as contrary to the constitution of the United States. For it is well settled that that instrument does not prohibit the states from passing retrospective laws, divesting antecedent vested rights of property, provided such laws do not impair the obligation of contracts, or partake of the character of ex post facto laws, however repugnant they may be to the principles of sound legislation. (Charles River Bridge v. Warren Bridge, 11 Peters, 539, 540.)
Under our form of government the legislature is not omnipotent, whatever the parliament of England may be in theory. It is only one of the organs of that absolute sovereignty which resides in the whole body of the people. It has the power, subject to the qualified negative of the governor, to pass any law which it may deem necessary for the public good, not inconsistent with the first principles of government, nor contrary to the provisions of the constitution of this state or of the United States.
It is a familiar principle in jurisprudence, that a statute shall not have a retrospective effect so as to destroy a vested right. (Mann v. Eckford's Executors, 15 Wend., 519.)
The late Chancellor Kent says (1 Kent Com. 455, § 20), that a retrospective statute, affecting and changing vested rights, is very generally considered, in this country, as founded on unconstitutional principles and consequently inoperative and void. This doctrine, however, is not understood to apply to remedial statutes, which may be of a retrospective nature provided they do not impair contracts or disturb absolute vested rights, and only go to confirm rights already existing, and in furtherance of the remedy by curing defects, and adding to the means of enforcing existing obligations. I cannot assent to the doctrine supposed to be advanced in Butler v. Palmer (1 Hill, 324), that the legislature has unlimited power to interfere with vested rights, unless they be saved by some restriction to be found in the federal or state constitution. (1 Kent Com., 5 ed., 456, note A; Wilkinson v. Leland, 2 Peters, 657.) There is, unquestionably, a distinction between the obligation of a contract and the remedy given to enforce that obligation, and thus without impairing the obligation of the contract, the remedy may be modified as the wisdom of the legislature may direct, with the qualification that I have before mentioned.
In Dash v. Van Kleek (7 Johns., 477), Mr. Justice Spencer says, in reference to the power of the legislature, that he should undoubtedly deny that it could annul an existing judgment, because then there immediately arises a contract against the party adjudged to pay a sum of money in favor of him to whom it is awarded.
Previous to the passage of the act (§ 460) the defendant Newbury had obtained a complete and final decree against the complainant Burch, for the payment of a specific sum of money, and although there had existed, at the time of making the decree, a right in the complainant, for a time limited by law, to have the cause or matter in controversy between the parties, upon which the decree was made, reheard before the judges of the supreme court at general term, and an appeal from the decree that should be made by that court on such rehearing to the court of last resort — and a remedy full and complete to enforce such right—he allowed the time prescribed for pursuing his remedy to elapse without taking any steps to procure a rehearing; and thereby, as the law then stood, the decree obtained became indefeasible, completely vesting Newbury with the right to the money decreed to him which had been paid or collected of Burch, pursuant to the terms of the decree.
Thus situated, the legislature interfered; not to prescribe a rule for all future cases, but to provide a new remedy for the benefit of a class of persons to obtain a rehearing by appeal, in suits in which decrees had been made and become final against them, where the right to a rehearing at the time not only existed, but had been previously and intentionally abandoned—and thereby not only to impose upon the party in whose favor the decree was made, the expense and inconvenience of another hearing, but to subject all his rights and claims in the matters in controversy, which had been determined and become vested and absolutely fixed by the law then in force, to the uncertainty of future litigation, to be lost or saved as accident and opinion might afterwards happen to injure or befriend them.
The misfortune of having vested rights, under judgments and decrees of our courts, thus disturbed is far from being trivial, if we consider that on this principle no judgment whatever in a court of law can be rested upon as final.
But it was said by the learned judge on denying the application to dismiss the appeal brought under § 460, that the act was not unconstitutional; that it was merely a pro vision to extend the time for bringing an appeal; that it affected the remedy only, and did not impair the obligation of contracts or take away a vested right. Several cases were cited, and among them the case of Calder v. Bull (3 Dallas, 386), as being an express authority in affirmance of the constitutionality of the section referred to. I do not understand such to be the effect of the decision in that case. It was this: On the 21st of March, 1793, the court of probates for Hartford county disapproved of the will of N. Morrison, and refused to record it. No appeal was made from that decree in eighteen months, and by that neglect and a statute of Connecticut all right of appeal was barred. In May, 1795, the legislature of Connecticut passed a resolution or law, setting aside the decree, and granted a new hearing by the same court of probates, with a right of appeal in six months. A new hearing took place; the will was approved and ordered to be recorded ; an appeal was taken to the superior court of the state, who affirmed the decree; and on appeal from that court to the court of errors of Connecticut, it was affirmed. From that court it went before the supreme court of the United States, where it was contended on the one side that the said resolution or law of the legislature of Connecticut, granting a new hearing in the case before the probate court, was an ex post facto law, and as such contrary to the constitution of the United States, and therefore void. Whether the resolution or - law mentioned was within the provision of the federal constitution, prohibiting any state from passing any ex post facto law, was the sole question raised or decided in the case, and in respect to that, the court held that the prohibition applied only to criminal and not to civil cases. The resolution or law under consideration was viewed rather as a judicial than a legislative act; it being a mode of obtaining a new trial, authorized by the course of judicial proceedings in that state; that at all events, if it was to be considered a legislative act, not being an ex post facto law, within the meaning of the constitution, it did not belong to that court to declare it void. Chase, J., said that he was fully satisfied that that court had no jurisdiction to- determine that any law of any state legislature contrary to the constitution of such state, was void.' And further, if that court had such jurisdiction, yet it did not appear to him that the resolution or law, in question, was contrary to the charter of Connecticut, or its constitution, which was said to be composed of its charter, acts of assembly, and usages and customs.
Paterson, J.,
observed, that the legislature of Connecticut acted in a double capacity, as a house of legislation with undefined authority, and also as a court of judicature in certain exigencies; and he came to the conclusion that the legislature in that instance acted in its accustomed judicial capacity.
The direct effect of the act in question, if valid, is the granting of a new trial or hearing upon all the questions both of law and evidence arising in the case, after it had been lost by the neglect of the complainant under the provision of law as this existed at the time the decree was made and after it had become final upon the rights of the parties involved in the suit, and the defendant had acquired possession of the fruits of the litigation by due execution upon it. If the act is not invalid upon principles which I have endeavored to state, as I think it is, it seems to me that it is contrary to the clause in article 1, § 6, of the constitution of this state, which provides that "no person shall be deprived of life, liberty or properly without due process of law."
The act assumes to create the means by which the complainant may open the decree for a reconsideration and adjudication upon the merits in controversy in the suit between the parties, irrespective of the present decree substantially, by another court having power to alter, modify or reverse the decree and to make a new decree adjudging money to be paid by the defendant to the complainant. In such an event, the money adjudged to and obtained by the defendant under the existing decree, would be taken from him and returned to the complainant, and the means provided by which—upon the contingency, that the appellate court shall come to a contrary conclusion upon the merits óf the controversy from that which the court, pronouncing the decree, came — it might and would be done.
It is in effect doing more than merely annulling a complete and final decree, by which property has been acquired and possessed. Contingently, it not only deprives such person of the property thus acquired, but compels him to pay to his adversary such sum of money as the appellate court may determine he ought to pay.
That the money adjudged to be paid by the decree and received by the defendant under it, was his property in a legal sense, at the time of the passing of the act, cannot admit of any doubt; he owned, had a legal title and was in possession of it.
It is true the act does not absolutely deprive the defendant of the money decreed to him, but it does contingently in effect. I think the provision contained in the constitution referred to, secures a person against being deprived of his property, either contingently or absolutely. If the appeal authorized to be taken by the act may result in depriving the defendant of his property, it is in my opinion contrary to the constitution.
It cannot be pretended that the words " without due process of law," used in the constitutional provision, mean a statute passed for the purpose of working the wrong. They cannot mean less than a prosecution or suit instituted and conducted according to the prescribed forms and solemnities for determining the title to property. (Taylor v. Porter, 4 Hill, 146, 147.) My opinion therefore is, that the order denying the motion to dismiss the appeal should be reversed, as also the decree appealed from, and the appeal be dismissed with costs. But if I am mistaken in the conclusions to which I have come, as above stated, I think the decree appealed from should be affirmed substantially for the reasons given by the learned judges who ordered the decree at the special term and affirmed it at the general term. (1 Bari., 648.)
All the judges concurred in the opinion of Welles, J., except Gardiner, J., who disssented.
Decree affirmed.