Case Name: Lowber v. Le Roy
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1848-11-11
Citations: 2 Sandf. 202
Docket Number: 
Parties: Lowber v. Le Roy.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 4
Pages: 202–221

Head Matter:
Lowber v. Le Roy.
The terms of a written contract which are free from, ambiguity, cannot be varied or impaired by parol evidence, nor by proof of the subsequent acts of the parties.
Such acts are, in general, not admissible, except in cases of latent ambiguity in the written contract.
The admission of extrinsic evidence to show the condition of the subjects of the contract, and the circumstances under which it was made, rests on a different principle.
The folly or the wisdom of the contract, as one or another construction might be placed upon its terms, is a dangerous element to introduce into the interpretation of agreements.
In applying a contract to its subject matter, the popular meaning of the descriptive terms used must govern, where it is not inferrible from the contract or the subject, that such terms were used in some technical or other sense.
The word “ assets,” in its common acceptation, means “ property.”
The word “machinery,” though more appropriate to a steam engine and its fixtures, than to a lead pipe machine or a rolling mill, is sufficiently extensive in its meaning to embrace both of the latter; and it was held to include them on the terms of the contract, and the existing facts to which the contract was applicable.
Where by a written agreement for a dissolution of a partnership, which, among other property, owned a steam engine, a rolling mill, and a pipe machine ; one of the partners was to take all the machinery, and it was clear upon the terms of the writing and the existing circumstances, that this included the steam engine and rolling mill, as well as the pipe machine; the court excluded parol evidence which was offered to prove, that the two former were not included in the machinery, but were to belong to another party; and as a part of the parol testimony excluded a written list of assets, subsequently made by a clerk in the presence of the first named partner, and at his request, to show the other party what property he was receiving, in which list (not signed) the two disputed machines were enumerated.
The court also excluded parol evidence of acts of the parties subsequent to the dissolution, offered with a view to show that the two machines belonged by the agreement for dissolution, to the other party.
Sept. 19, 20 ;
Nov. 11, 1848.
This was an action of assumpsit for money paid, which was tried before Oaklet, Ch. J., in February, 1848.
The plaintiff read in evidence articles of copartnership, dated July 1st, 1845, made between the defendant, Jacob Le Roy, of the first part, and the plaintiff and Thomas Otis Le Roy of the second part; by which the two latter became general partners under the name of Lowber & Le Roy, and the former, as special partner, contributed $25,000 as capital. The plaintiff was to contribute as capital $23,032 50, consisting of his stock and assets in the previous business; among which was included “machinery and fixtures, $12,250,” consisting of a lead pipe machine hereafter mentioned. The business of the firm was purchasing and selling pig, sheet and bar lead, and manufacturing and selling the plaintiff’s patent tin plated lead pipes, in the city of New York. The partnership was to continue five years. The general partners were to devote their whole time and attention to the business; the profits were to be equally divided between the plaintiff and the defendant. Out of the share of the latter, T. O. Le Roy was at liberty to draw out $2500 annually. The plaintiff was restricted from selling or disposing of the right to vend or use his patent for tinning lead pipe, without the defendant’s consent. At the close of the concern, the plaintiff was to assume $6000 of the liabilities, in place of the like amount due from him at the outset, which the firm agreed to pay.
The partnership commenced and continued until on or about the 4th of April, 1846. The business had proved to be a losing one, the defendant was not satisfied to proceed with it, and the copartnership was thereupon dissolved. To show-the terms of this dissolution, the plaintiff read in evidence the following correspondence:
“ New York, April 4th, 1846.
“ Jacob Le Roy, Esq.—Dear Sir : I have just been informed by Mr. David Smith, of the conversations had with yourself, and in accordance therewith, would propose a dissolution of the partnership existing between us on the following terms :
“1st. You are to assume and pay all outstanding notes against Lowber & Le Roy, (a schedule of which is hereunto annexed,) and all claims by James Yandenburgh, yet unpaid, on the building.
“ 2d. The current expenses of Lowber & Le Roy, due this day to hands for labor, to be paid out of funds on hand.
“3d. You to take all notes and accounts standing on the books,, and due Lowber & Le Roy, and all pig lead, pipe, sheet lead and assets, not appertaining to or belonging to the ma- . chinery.
“ 4th. You are to lease to me the building now occupied by Lowber & Le Roy, for the term of five years, with right of renewal.
“ 5th. I am to take all machinery, and such things belonging thereto now on hand, and to pay all claims yet due thereon, except such as are mentioned in the schedule of bills payable, such articles of office furniture or stock not yet paid for, or charged in the account of indebtedness, to be assumed by me.
“ 6th. For the security of Lowber & Le Roy, that such debts as I am to assume shall be punctually paid, I am to give you security upon the machinery I take.
“ 7th. This arrangement to take effect on Monday, the 6th inst., when all books and assets will be given into your hands.
“ Schedule of bills fay able.
“ Note Sun Mutual Insurance Co., due April 26, $301 25
“ “ “ “ July 25, 55 61
“ Stillman, Allen & Co., due May 20, 3000 00
“ James McCullough, due April 20, 5767 64
“ Wm. Kemble, due June 13, 2300 00
“ American Exchange Bank, due May 18, 4000 00
Note American Exchange Bank, due May 22, 5000 00
it Ü i( ii (i June 21, 5000 00
if ii Ü ii Ü May 29, 4500 00
ii Ü ii Ü ii June 18, 2000 00
“ Lowber & Le Roy have also borrowed of Strachan & Scott, eight thousand dollars, to be repaid out of sales of pig lead, a part of which has now been made.
“ I am very truly, your obd’t.
“ Robert W. Lowber.”
“ P. S. This arrangement is upon the express condition, that all amounts over and above twenty thousand dollars, which may be realized out of the assets given you by Lowber & Le Roy, after paying the notes enumerated in the schedule, shall be paid to me.
Yours, &c.,
“ R. W Lowber.”
“New York, April 4th, 1846.
“ R. W. Lowber, Esq.—Sir: The proposition for the dissolution of the partnership of Lowber & Le Roy, submitted by you to me under date of 4th April, 1846, I will accept, provided you accede to the following modification of your proposition. In lieu of the 4th article of your proposition, I propose the following. I agree to lease to you the building now occupied by Lowber & Le Roy, for five years, with the right of renewal for another term of five years, at the yearly rent of three thousand dollars, payable quarterly, provided you give to me David Smith and Edward J. Lowber as security for the due and punctual payment of the rent. The proposition submitted by you to me, is in all other particulars, except the said fourth article above mentioned, to take effect on Monday next, the 6th instant; and the article substituted by me for the said fourth article, shall be complied with on your part on or before the 1st day of May next, otherwise it shall not be binding or obligatory upon me.
Very truly, your ob’t. serv’t.,
“ Jacob Le Roy.”
“New York, April 4tk, 1846.
“Jacob Le Roy, Esq.—Dear Sir: I am in receipt of yours of 4th instant, and accept the modification of the fourth article, and engage to take a lease upon the terms proposed, to commence on the 1st day of April, and will, by the 1st day of May, execute a lease with the security you name.
“Yours respectfully,
“ Robert W. Lowber.”
It appeared in evidence, that at this time, as well as during the partnership, the machine mentioned in the copartnership articles, which was a lead pipe machine, was mortgaged by the plaintiff to his father-in-law, for its full value. This pipe machine- was the only machinery which was in existence when the firm commenced. During the continuance of the firm, the partners had procured what was called a rolling mill for rolling sheet lead, and a steam engine; both of which had been erected in the basement of the building where their business was conducted, and where the pipe machine was situated. The steam engine had been connected with the pipe machine, so as to work it; but the connection with the rolling mill was not fully completed.
The rolling mill had been procured from the West Point Foundry Association, of which William Kemble was the agent. The contract price for it was §2300, and for this was given the note of §2300, mentioned in the schedule in the plaintiff’s letter of April 4th. In addition to this, the firm at that time owed to Mr. Kemble, agent, for extra work to the rolling mill, about §1700, which was standing in an open account.
The steam engine had been procured from Stillman, Allen & Co., and the contract price for it was §3400. The note of §3000 to Stillman, Allen & Co., mentioned in the same schedule of April 4th, was given towards the debt for the steam engine. At the dissolution, the firm of Lowber &. Le Roy owed in account to Stillman, Allen & Co., about §2000; of which about §1200 was for work done on the pipe machine and a hoisting apparatus, §400 was the balance of the contract price of the steam engine, and several hundred dollars was for extra work on the steam engine.
The firm was at that time indebted the sum of §883 58, to James Yandenburgh, for building the foundation, the flue, and the other mason work for the steam engine.
The plaintiff claimed to recover for the amount of the two notes to W. Kemble and Stillman, Allen <fc Co., and the debt to Yandenburgh, mentioned in his letter of April 4th, which the defendant had agreed to pay in the dissolution, and which the plaintiff insisted he had paid. To prove such payment, he gave evidence tending to show that the week after the dssolution, the defendant declared that he would not pay the same. He then read in evidence an agreement under seal, dated April 6th, but executed April 13th, 1846, between himself of the one part, and T. O. Le Roy and David Smith of the other part. By this instrument, the plaintiff agreed to manufacture for the other parties, (whose firm was T. O. Le Roy & Co.,) patent tin plated lead pipe and other lead pipe, and sheet lead, with all the expedition the machinery and one set of hands would allow, at prices stipulated, delivered on the first floor of the stores where the previous business had been conducted ; the manufacturing to be done in the basement. He was to pay $500 a year rent, and was to allow the use of his steam engine when running, to elevate goods. He was not to manufacture for any one else, while the agreement continued. T. O. Le Roy & Co. agreed to assume the payment of the notes and accounts due to Kemble, and to Stillman, Allen & Co., and the account due to Yandenburgh from Lowber & Le Roy; to secure them in which the plaintiff agreed to mortgage to them the engine, boiler, rolling mill and fixtures, for the sum of $6000, and that they might retain out of the sums coming to him for pipe and sheet lead, all the surplus, after paying the expenses of running the works, and an annual allowance to the plaintiff for his personal expenses.
The plaintiff then read in evidence another agreement executed between the same parties, dated Hay 13th, 1846, and substituted for the former. It did not differ from the one dated April 6th, in respect of the mode of payment therein provided for the debts of Lowber & Le Roy, to Stillman, Allen & Co., W. Kemble, and J.Yandenburgh, by T. O. Le Roy & Co.; and it recited that the plaintiff had executed to the parties of the second part, T. O. Le Roy & Co., the mortgage for $6000, on the steam engine and boiler, and rolling mill and fixtures, dated May 6th, 1846. By this agreement, certain other payments were provided for out of the sums becoming payable to the plaintiff for manufacturing.
The defendant, on being called upon, produced the notes to Stillman, Allen & Co., and W. Kpmble, mentioned in the schedule and letter of April 4th, which appeared to have been paid. The plaintiff proved that those notes and the account of Vandenburgh, were paid by T. O. Le Roy &. Co.
It was proved that T. O. Le Roy and David Smith formed a connection, on or about the 6th of April, 1846, and carried on the lead pipe, sheet lead, and general business in lead, in the same stores which Lowber & Le Roy had occupied. Their business continued to the time of the trial.
The plaintiff next read in evidence, a bill of sale, under seal, executed by him to T. O. Le Roy <fc D. Smith, dated February 23d, 1847, by which for $10,143 43, he sold to them the steam engine and boiler, and the rolling mill in question, with all the fixtures and appurtenances. He also read in evidence a release of the same date, executed to him by T. O. Le Roy &. D. Smith, discharging him from all demands; also another release, dated February 24th, 1847, discharging him from the above mortgage of the 6th of May, 1846, in consideration of the sale of the machinery, &c., to them. The plaintiff also read in evidence, that mortgage; by which he mortgaged to T. O. Le Roy & D. Smith the steam engine, rolling mill, and all their fixtures, &c., conditioned to pay $6000, with interest, in one year from date.
The plaintiff then rested his cause.
The defendant called as a witness, David Smith, who testified that he was a clerk of Lowber & Le Roy, and afterwards a partner of T. O. Le Roy. He produced a paper, which he testified was made out on the 5th of April, 3 846, by E. J. Lowber, plaintiffs brother, under the direction of the plaintiff, for the purpose of showing to the defendant, what or how much of the assets of Lowber & Le Roy, he would get on the dissolution. It was made at the defendant’s request, by the plain tiff, E. J. Lowber and the witness; and was delivered to the defendant on the 6th or 7th of April. It is in E. J. Lowber’s handwriting.
T. O. Le Roy, for the defendant, also testified that the paper was made out to show his father what the assets were, and it was made under the direction of the plaintiff. Both of these witnesses testified to the effect, that on the dissolution of Lowber & Le Roy, the steam engine and rolling mill, with all their fixtures and appurtenances, went to the defendant; that he took possession of the same with the other assets, on Monday, the 6th of April; that within four or five days after, -he sold to T. O. Le Roy & Smith all the assets of the late firm, including the engine, mill and fixtures for $10,000, for which they gave their note to the defendant, and agreed to pay all the liabilities he had assumed; that they thereupon continued the lead business as partners ; that soon after they bought the engine, rolling mill, &c., of the defendant, they sold the same to the plaintiff for $6000, to secure which he gave them the mortgage thereon. And that they paid the notes to W. Kemble and Stillman, Allen & Co., and the account to Vandenburgh, in consequence and by reason of their assumption thereof with the defendant. T. O. Le Roy stated that the losses of Lowber & Le Roy, were about $>18,000.
The paper called the list of assets, so produced and proved, was read as follows ; (the plaintiff’s objection to the testimony being reserved:)
“ Assets.
“ We have on hand account on book amounting to $>22,818 81
5750 48 bills receivable,
4 20 1432 70 sheet lead, 34 112
4 50 1687 14 lead pipe, 37 492
3 50 281 96 old lead, 8 056
23 411 47 block tin, 1789
3 75 1634 6 lead at Cornell’s, 43 655
150 00 1 safe.
;,166 52
Brought forward, $34,166 52
We have on hand 1 stove, 36 80
« “ 5658 pigs lead, 374 424 12,945 90
“ “ machinery, (mill and engine,) 5300 00
“ “ cash, 1754 00
$44,203 32 bills payable,
$301 25 Due April 26, Sun Mutual Ins. Co.,
55 61 “ July 25, “ “
3000 00 May 20, Stillman, Allen & Co,,
5767 64 “ Jas. McCullough,
2300 00 “ June 13, William Kemble, agent,
4000 00 “ May 18, American Exchange Bank,
5000 00 “ “ 22, “ “
5000 00 “ June 21, “ “
4500 00 “ May 29, “ “
2000 00 “ June 18, “ “
4000 00 “ April 10, 11 “
4000 00 39,924 52 “ June 6, “ “
$14,278 82
Deduct item below, (sundry small bills which we have not been able to get in, estimate at) 500 00
$13,778 82
It was testified by Smith in his further and cross examination, that the note of $10,000, given to the defendant, was subject to adjustment, according as the affairs of Lowber &■ Le Roy should wind up. T. O. Le Roy & Co. were to allow him in such adjustment, $5300 for the engine, rolling tiiill and fixtures, They had paid him one year’s interest on the $10,000. There was no written evidence of the sale of these articles to them, or of the sale by them to the plaintiff. On the 5th of April, an agreement was drawn up by Smith, (the terms having been directed by the defendant,) to be signed by the plaintiff and T. O. Le Roy. The plaintiff was present when it was drawn. It was afterwards rejected by the defendant, and was never executed. The prices for manufacturing were objected to. This paper was produced, and was in its scope similar to the one executed April 13th, as before stated, except that there is no provision for paying the debts of Lowber & Le Roy, which are specified in the latter.
An account rendered by T. O. Le Roy &■ Co. to the plaintiff, under the date of January 19, 1847, was produced. The first charges in it are the notes to W. Kemble and Stillman, Allen & Co, under date of April 6th, 1846. The accounts paid to them respectively and to Vandenburgh, were charged under subsequent dates. There was no charge in the account for the machinery alleged to have been sold to him, but in their ledger, it was charged to the plaintiff at $5300, under date of April 6th, 1846. Those notes were not charged to the defendant in T. O. Le Roy & Co.’s books, nor was the payment to Vandenburgh.
Edward J. Lowber, for the plaintiff, testified, that the paper called the list of assets, was not made up under the plaintiff’s direction; that it was made out by Smith and the witness, that Smith might see whether it was safe to give the defendant $10,000. There was much additional testimony on both sides, but it is believed enough has been stated, to render intelligible the points of law discussed before the court.
The defendant’s counsel requested the judge to charge the jury upon certain propositions, substantially as they are contained in the points on the argument. .
The judge then charged the jury, that at the time of the dissolution of the firm of Lowber & Le Roy, that firm owed to Stillman, Allen & Co., $3000, to William Kemble $2300, and to Vandenburgh $883 58. The plaintiff contends, that by the agreement of dissolution, the defendant was bound to pay these debts, but failed to do so, and that he, the plaintiff, has been obliged to pay them.
The agreement is in writing, and it is not denied that by its true construction, the defendant was bound to pay these debts. It is contended, however, on the part of the defendant, that these debts were paid by the new firm of T. O. Le Roy & Co., under a contract between him and T. O. Le Roy & Co., by which, in consideration of his transferring to them certain assets, including the engine and rolling mill, they assumed his obligation and undertook to pay those debts.
The plaintiff contends, that the mill and engine became his sole property by the terms of the agreement of dissolution, and that the debts in question were paid by the firm of T. O. Le Roy & Co., out of the property of the plaintiff, to wit.: the engine and rolling mill, and such payment charged by them to the plaintiff; and the case turns upon the truth of the one or other of these propositions.
And in reference to the law bearing on the ¡questions thus stated, the judge gave the jury the following instructions :
First. That by the terms of the contract, the property in the engine and mill vested in the plaintiff, and those terms being clear and free from any ambiguity, no parol evidence is competent to vary it.
Second. That the statement of assets cannot affect the contract, unless it had been annexed to or made a part of it, by being communicated to the defendant at or before the final making of the contract.
Third. That a payment of the debts in question by T. O. Le Roy & Co., out of the property of the plaintiff, if it was so made, was as effectual to authorize the plaintiff to recover as a direct payment by himself; and with these instructions, left the case to the jury on the evidence. To which charge of the judge, the counsel for the defendant excepted, and also excepted, because the judge refused to charge the jury as requested.
The jury found a verdict for the plaintiff for $6920 32, and the defendant moves for a new trial.
J. W. Gerard, and H. Ketchum, for the defendant, made the following points.
I. The list of assets, and the cotemporaneous and subsequent acts, declarations, and dealings of Lowber, and all the parties, show that on the dissolution, the steam engine, and rolling mill were .to pass to Jacob Le Roy.
Every probability is in favor of the theory, that this engine and mill, as part of the assets of the firm of Lowber <fc Le Roy, Avere to pass to the defendant; from the large capital he put in, from the losses of the firm, $18,000, from the small value of the assets Avithout the engine and mill, and from the assumption of the debts of the firm by the defendant, including the three debts in question.
II. The judge erred in excluding in his charge, the list of assets, and all the cotemporaneous acts and declarations of Lowber, from the consideration of the jury, and in deciding that the letter of dissolution of the 4th of April, was free from all ambiguity, and that by it, as a matter of fact, the engine and mill were to be the property of LoAvber.
Under the evidence, that paper contained a latent ambiguity as to the term “assets" Avhich were to go to the defendant, and what was the “ machinery,” which was to pass to the plaintiff; and the list, and other cotemporaneous acts and declarations of the plaintiff, were admissible to apply the contract to the proper subject matter. (Chitty on Cont. 104 to 106.)
The terms “ assets” and “ machinery,”' on the face of the letter of the 4th of April, are indefinite and uncertain as to the things that Avould pass ; and they are rendered more so by the evidence that there Avere two sets of machinery, the old pipe machinery repaired, which LoAvber had brought in, and the engine and mill which the firm had made. The term “ machinery” included the pipe machine, but not the mill or, engine.
The two papers, dated the 4th and 6th of April, formed but one contract. The contract was not completed until the 6th of April, when the articles were delivered. The first was made out and rendered to Mr. Le Roy, to particularize, as by a partnership account of stock, what assets Avere to pass under and be delivered with the letter of dissolution. (1 Phill. Ev. 562; Cowen & Hill’s Notes, 1398, 1400, 1401, 1406, 1408, 1409, and 1367, 1368, 1387, 1392, 1395, 1399, 1411; 19 Johns. 313; 1 Stark. Rep. 210; 12 Wend. 573; 4 Hill, 104; Chapman v. Black, 4 Bing. N. C. R. 187, 193, 196.)
III. The judge should have submitted the inquiry to the jury, whether the parties did not intend that the letter or agreement to dissolve and the list should form one contract.
IY. The judge erred in not charging the jury as requested, that, if by virtue of a new contract of sale of the engine and mill by T. O. Le Roy & Co. to the plaintiff, he, the plaintiff, paid these notes himself, or through T. O. Le Roy & Co., as the consideration for the purchase of those articles, he'cannot recover.
Y. The judge erred in not charging the jury as requested, that if they believed the testimony of Smith and T. O. Le Roy, that the firm of T. O. Le Roy & Co. took the mill and engine as the property of Jacob Le Roy, then the moneys paid by them in taking up the notes were not paid by the plaintiff.
YI. The verdict is contrary to law and evidence.
C.. O'Conor, for the plaintiff, made the following points.
I. The agreement of dissolution, in plain and unambiguous language, made a division of the copartnership property, assigning to the plaintiff the engine and rolling mill as well as the other machinery.
1. The contract was perfect on the 4th of April, 1846.
2. The exception in clause fifth, coupled with the list of bills payable, and the fact that there were no other bills payable for machinery, except the two notes in question, precludes all doubt that the words “ all machinery” included the engine and rolling mill.
II. The documentary evidence given by the plaintiff touching his transactions with T. O. Le Roy & Co., subsequent to the dissolution of Lowber & Le Roy, was not introduced by him to qualify or explain the agreement with Jacob Le Roy. It was necessarily given to establish the independent fact, that he, the plaintiff, had paid the notes in question. The necessity which compelled a resort to this evidence for such independent purpose, justified the resort; and consequently' the defendant did not acquire any greater right to invoke such testimony to explain the agreement, than he would have possessed in case the evidence was originally offered by himself.
III. Under these circumstances, the paper called a schedule of assets was not admissible to contradict, vary, or explain the agreement.
1. It was made after the written agreement was perfect and consummated.
2. It was not signed by either party, and is not in the handwriting of either party.
3. It is not authenticated in any way as the act of either party.
4. It is not annexed to the agreement, and cannot be connected with it in any way, except by mere oral evidence of imputed intentions, not made apparent by any thing done, or any written memorial.
5. It is so vague and indefinite in its import, that if actually annexed t® the written agreement, the legal construction would not be varied.
IV. The whole case shows, that the defence attempted had no foundation in truth or justice.
1. Smith and T. O. Le Roy swore, that the defendant did not know what he was to receive on the dissolution, and the rejected agreement of April 6th shows, that they understood the machinery, including the steam engine, to belong to Lowber.
2. All the documentary evidence is consistent with itself, and supports the plaintiff’s theory of the case.
3. None of the documentary evidence supports the defendant’s theory, and most of it conflicts therewith.
V. it is perfectly manifest, that justice has been done according to law; and the verdict ought therefore to be sustained.

Opinion:
By the Court. Sandford, J.
The agreement between the parties, for the dissolution of the firm of Lowber & Le Roy, the disposition of its property, and the payment of its debts, was in writing, and was signed and delivered on the 4th day of April, 1846. The effort on the part of the defendant at the trial, was to influence and control the effect of this agreement, by a writing or schedule without signature or authentication, made out on the 5th of April, together with parol evidence of what was subsequently agreed upon between these parties and T. O. Le Roy & Co. The judge, after receiving the testimony provisionally, instructed the jury that the terms of the agreement for dissolution, being clear and free from ambiguity, no parol evidence was competent to vary it; and that the list of assets could not affect it, unless it was annexed to the agreement, or was made a part of it by being communicated to the defendant before the final making of the agreement. The case turns upon the soundness of the judge's construction of the terms of the contract executed by the parties ; for if those terms were free from ambiguity, clear and explicit; no one questions that it was incompetent to vary or impair them by parol evidence.
The proof of subsequent acts, falls equally within the well established rule excluding oral testimony. Where the contract has been carried into effect, the acts of the parties furnish more satisfactory evidence than their words, when the contract itself contains a latent ambiguity; but where its terms are clear-, such acts are inadmissible to vary or control its construction. The defendant relied much upon Chapman v. Black, (4 Bing. N. C. 187,) which was the case of a lease made out by letters, and there being great doubt on the language of the letters whether the parties had agreed for a present demise, or to draw up and execute a lease at a future time, evidence of possession and payment of rent was admitted in aid of the construction. Strong language was used by two or three of the judges, in respect of the competency of acts, as indicative of intention, but they were applied to the strong features of the case before them; while one judge, without referring to the acts at all, found sufficient in the letters to construe them into a present demise.
In this, and in several other reported cases in England, on the same question of a lease in presentí, or an agreement to lease ; there is no conflict with the rule of law to which we have alluded. The evidence was admitted on the express ground that the instruments in writing were ambiguous, in respect to the subjects to which they were applicable, or upon which the intention of the parties was brought to bear.
The admission of extrinsic evidence, to show the condition of the subjects of the contract, and the circumstances under which it was made, is a wholly different matter, and ope upon which there is no dispute here. Nor was it seriously contended, if there were no latent ambiguity as to the terms of the agreement for dissolution between these parties, that either the list of assets, or the subsequent acts, would be competent to influence its construction.
We must therefore ascertain whether there was any latent ambiguity in the agreement. The defendant insists that the term assets, and the term machinery, as used in the contract, were thus ambiguous, and require the aid of the acts and declarations of the parties, in order to give them a sensible construction.
First. As to the word " assets." This is equivalent in its common acceptation to the term " property," and as used in this instrument, embraced all the property of Lowber & Le Roy which was not excepted. The defendant needs no evidence to explain a word which plainly gives to him all that the firm had, save so far as it is controlled by a clear exception. The exception here is " the machinery," and whatever " appertains to or belongs to the machinery."
Second. This brings us to the real point in controversy, was there any latent ambiguity in this contract, in respect of what was intended by the word " machinery ?"
In its primary signification, this word would rather include the steam engine and fixtures, than either the pipe machine or the rolling mill; the two latter being more properly machines, and the former the combination of powers to put them in motion. The defendant's object, is however, to withdraw the steam engine, as well as the rolling mill, from the operation of the term used in the contract.
We do not think that we can assume that a word of such extensive application in common parlance, as is the word 11 machinery," is to be construed and defined when used in a contract, with the nicety of the lexicographers. And we must have recourse to the facts and circumstances. upon which the contract was made, in order to apply its terms to the objects of the contract. In applying it to those circumstances, the popular meaning of the terms must govern, when it is not inferrible from, the contract or its subject matter, that they were used in some technical or other sense.
When Lowber & Le Roy dissolved, they had assets of all the kinds enumerated in this agreement, and they were indebted for the debts therein enumerated, besides the accounts for extra work on the engine and rolling mill. The assets, which one or the other of the parties insists constituted the machinery, were first, the pipe machine, second the steam engine, and third the rolling mill. The pipe machine was the plaintiff's before the partnership. It was incumbered to its full value, so that it was of no particular advantage for any one to take, except for immediate use. There was no claim for or upon it, against the firm, by way of note or obligation; but there was an account against the firm for repairs done upon it by Stillman, Allen &. Co., to the amount of about $1200.
The steam engine was new, and so far as it appears, worth all it had cost. The firm owed its entire, cost, of which $3000 was in a note to Stillman, Allen & Co.; and $400 of the contract price, with about the same amount for extra work, was due to that firm in an open account. The rolling mill was also new, and had never been used. The firm owed its whole cost to Mr. Kemble as agent for the West Point Foundry, of which $2300 stood in their note to Mr. K., and the extra work, about $1700, in an open account.
Now by the first stipulation in the contract, the defendant was to pay all the outstanding notes against Lowber &. Le Roy. Of course he was to pay the note of $3000, given in part payment of the steam engine ; and the note of $2300, given for the rolling mill, exclusive of the extra work. By the third stipulation he was to have all the assets, " not appertaining or belonging to the machinery."
By the fifth stipulation, the plaintiff was to take " all the machinery and such things belonging thereto" then on hand, and he was to pay all claims yet due thereon except such as were mentioned in the schedule of bills payable. The only claims of the kind mentioned in the schedule, were the notes to Kemble for $2300, and to Stillman, Allen & Co. for $3000. Finally, the plaintiff, for the security of the firm that he would pay the debts he assumed, was to give the defendant security upon-the machinery he was to take.
Now applying these terms to the actual condition of things, and is there any room for a doubt as to what was intended by the word " machinery ?" Can it be answered by the pipe machine, excluding the other two ?
The plaintiff was to pay all claims due on the machinery, except the bills in the schedule. But there was no bill or demand in the schedule which had ever been a claim upon, or in any mode grew out of the pipe machine. So that this language could not be applied to the pipe machine at all. How does it apply to the two others ? It is obvious that the application is perfect. There was a claim due and mentioned in the schedule, on the steam engine; there was a like claim mentioned in the schedule and due on the rolling mill. Thus one of the most important clauses of the contract, is made senseless by restricting the word " machinery" to the pipe machine, while it has full scope and bearing when extended to the other two articles in dispute.
Take the next provision. The plaintiff was to pay the claims due on the machinery he was to take, except the two notes. There were such claims due on all three of the machines, (if we may so class them,) and thus the stipulation has full effect to provide for nearly $4000 of accounts due for extra and other work on those machines. But if we exclude the steam engine and rolling mill, there remain more than $2500 of accounts for work done on them, for the payment of which there is no provision in the dissolution ; for the defendant bound himself to pay only the scheduled debts, and these are not scheduled; and the plaintiff was not to pay any claims except on the machinery that he took. Thus if " machinery" included all the three machines, the fifth article is full of meaning and every word of it applies to an existing object; if it did not include all three, the article is senseless, and the whole agreement defective in omitting to provide for what it professed to embrace.
The sixth stipulation, it is urged, shows a different meaning, in the expression, " machinery I am to takethat this shows there was machinery which the plaintiff was not to take. We do not think such an inference is legitimate from the language used; and when the stipulation is considered in the construction which the defendant desires to put upon the word " machinery," it leads to a very different conclusion. If that construction be correct, the plaintiff was liable to pay merely the $1200, due to Stillman, Allen & Co. for repairs &c., on the pipe machine ; and he was to make the defendant secure that he would pay it, by a mortgage on the pipe machine. In other-words, for the sake of obtaining a machine mortgaged for all it was worth, the plaintiff was to pay $1200; and the defendant was gravely to take security on the same incumbered machine that he would pay it punctually.
There is no such absurd consequence, if we consider the term " machinery" as embracing all three of the articles in question. The sixth stipulation, as well as the others, then becomes sensible and operative upon existing things and circumstances.
Upon the whole, after a careful examination of this instrument, in connection with the state of things actually existing and upon which it professed to operate, we cannot find a shadow of ambiguity in its terms. The word " machinery," in its popular sense, would probably embrace engine and rolling mill, as well as the pipe machine ; and as used in this agreement, it cannot mean any less than the three.
We were much pressed with the extreme improbability of the defendant's making such a contract, as he did make, upon this construction of the. agreement for dissolution. As to this, we cannot tell how anxious the defendant was to put an end to the partnership, nor what other motive may have influenced him. The folly or the wisdom of the contract, as one or another construction might be placed upon its terms, would be a dangerous element to introduce into the interpretation of agreements. It suffices for this case, that whatever were the views of the parties, they have expressed their agreement in terms too plain to be doubted or misunderstood.
As the list of assets was not made until the agreement for dissolution was complete and perfect, the judge was correct in excluding it from the consideration of the jury.
The conflicting testimony of the subsequent acts and parol agreements of the parties, had much less to recommend it than the list of assets; and its exclusion with the latter was a matter of course.
The defendant makes a further point, that if by virtue of a new contract of sale of the engine and rolling mill by T. O. Le Roy & Co. to the plaintiff, the latter paid the demands in question himself or through that firm, as the consideration for the purchase of those articles, he cannot recover.
This consequence would not necessarily follow from such a sale as was supposed, because the defendant is not connected with it; and if the plaintiff chose to pay these demands, and at the same time and in the same transaction buy his own property of T. O. Le Roy & Co., it would still be money paid for the defendant. But the conclusive answer to the point is, that the plaintiff having become the owner of the mill and engine by the dissolution agreement, must be assumed to have first sold them to Le Roy & Co., or to some person from whom they bought, before there could be a sale to him by that firm. Nor would it alter the case, if T. O. Le Roy & Co. took the mill and engine as the property of the defendant; so long as it was in fact the plaintiff's property and was used to pay the defendant's debt. The controlling feature in the cause, is the effect of the agreement for the dissolution ; and as we have been unable to go behind what we conceive to be its plain and explicit terms, awarding the engine and mill to the plaintiff; the defence is at an end.
Motion for new trial denied.