Case Name: Theodosius F. Secor, and Charles Morgan, Plaintiffs and Respondents, v. George Law, Defendant and Appellant
Court: New York Superior Court
Jurisdiction: New York
Decision Date: 1862-03-15
Citations: 9 Bosw. 163
Docket Number: 
Parties: Theodosius F. Secor, and Charles Morgan, Plaintiffs and Respondents, v. George Law, Defendant and Appellant.
Judges: 
Reporter: Reports of cases argued and determined in the Superior Court of the city of New York
Volume: 22
Pages: 163–192

Head Matter:
Theodosius F. Secor, and Charles Morgan, Plaintiffs and Respondents, v. George Law, Defendant and Appellant.
1. The defendant and others who were associated in an enterprise of building certain steamships to fulfil a contract with the United States government for carrying the mail, entered into an agreement with each other whereby the defendant and R, G. and W., agreed to build such steam vessels, to conform to such government contract, under the direction and control of the defendant; such vessels when built to be held by the defendant, and R. and M., as trustees for. the other associates. • The- hulls of two of such ves seis having been built, the defendant made a contract with the plaintiffs’ firm for the steam engines, at a cost of $300,000. This contract, which was tripartite, purported, in the body of it, to be made by the defendant and B., O. and W., with another person, who was not a party to the original agreement of the associates; but it was not signed by any one but the defendant. In making it and carrying’it out, the plaintiffs’ firm dealt only with the defendant. He made sundry payments upon the contract, partly by conveying land in which his associates had no interest, and partly by giving his individual notes, payable at a future day, without adding interest for the time, which ho refused to include on account of alleged delay in the work, and of a claim to damages for which delay, he had given them written notice in his own name. Upon accounting with his associates, he charged ■them with the price of the land as a cash payment, and interest upon the notes he had given, from the day of giving them, and after adjusting his accounts with plaintiff’s firm, promised them to pay the balance.
Meld, that in an action for the balance due for the work under the contract, and extra work on the same vessels, such facts were evidence from which a Beferee might infer that exclusive credit was given to the defendant, and if so, that an action would lie against him alone, without joining the other persons named with him in the instrument.
Meld, further, that even if this were not the case, he made himself liable on the contract by signing it alone; there being no proof that he intended not to be bound until the others signed.
Meld, further, that the evidence in the case being sufficient to sustain the finding by the Beferee, that the defendant, having, on an accounting with his associates, been allowed the sum due the plaintiffs’ firm, in consideration thereof assumed payment of the same to them, such finding would sustain ' the plaintiffs’ action against him alone.
Meld, further, that, upon the evidence, the Beferee being warranted in finding that the defendant, upon an accounting with the plaintiffs’ firm, in relation to the contract with them and the work under it, had either waived all claim for damages on account of delay in the work, or had considered the advantages he obtained in the settlement equivalent to it; he might disregard such claim as being no longer available to reduce plaintiffs’ claim.
2. It appearing on the trial of the cause, that at the execution of the contract sued on, the plaintiffs gave the defendant a receipt for $30,000, as paid thereon, but that such sum had not been charged by the defendant in His accounts with his associates by which he settled with them:
Meld, that evidence that the money had not actually been paid was admissible. Meld, further, that evidence of the failure of the defendant to communicate to his associates the fact that he had obtained credit by giving his notes without interest, or had conveyed land instead of paying money, at the time of settling his accounts with them, was admissible as a circumstance to .. show that the defendant deemed the contract entirely his own.
"3. It seems that the defendant had not, merely as a joint owner of the hulls of the vessels, authority to bind his co-owners, by a contract for the con- ' .version of '.them into steam vessels, by placing engines in them.
4. It seems that the objection of non-joinder of the other parties is waived, by setting up a counterclaim in favor of the defendant jointly with the same parties, against the plaintiffs.
5. It seems that a claim for unliquidated damages against the plaintiffs and others, in favor of the defendants and others, is not available by way of recoupment, counterclaim, or set-off.
6. Where a complaint, as originally framed, set up three separate causes of action, but after the proofs were closed upon the trial, and the cause submitted, the Referee permitted an amendment thereto by adding a statement of a fourth cause of action, (demanding the same sums as were demanded in the original complaint,) in which it was alleged that the defendant having claimed damages for delay in. the work, the parties, on an accounting of all these claims, including such last mentioned claim, found a specified balance due, which defendant promised to pay;
Sell, 1. That the defendant, by amending his answer, and taking issue on such new cause of action, waived all objections to the propriety of permitting the amendment..
2. That the amendment was within the discretion of the Referee, and-properly permitted.
(Before Bosworth, Ch. J., Moncrief and.Robertson,.J. J.)
Heard February 10; 1862;
decided March 15, 1862..
This .was an action to recover for work done and- materials furnished by the plaintiffs, at the defendant’s request, consisting principally of two low pressure steam engines,, constructed and placed on board of two- vessels, known as the Ohio and Georgia, at a certain contract price, and also for certain additional work done and materials furnished on board of such vessels, in putting up-some coal bunkers-with their appurtenances.
In April, 1847, a Mr. Sloo made a contract in writing, with the Secretary of the Navy of the United States to establish a line of steamships to transport the “United States mail between New York and New Orleans, pursuant to an act of Congress; passed, in March previous, authorizing such a contract.. The burthen of the vessels and the power of their engines were described in such contract; they were therein required to be constructed ‘ Under the direction of a constructor employed by the Navy Department, and to be capable of being converted into war steamers. A certain time was fixed therein for the completion of two of such vessels, (1st of October,. 1848,) and a certain other time for the completion of two inore, (1st of October, 1849,) aicertain vessel (the Missouri) was therein adopted as a model, and the details of the construction of such vessels were given therein. United States officers were to be employed on board of such vessels, and apartments provided for them. An annual compensation for all the services to be rendered by Mr. Sloo was provided for in such agreement, ($290,000,) and the Secretary of the Favy was authorized to take such ships at any time at an appraised value.
In August, 1847, Mr. Sloo assigned such contract to the defendant audMessrs. Roberts andMcIlvaine, byan instrument in writing, under seal, upon certain trusts therein contained; by such instrument, which was tripartite, the defendants, Messrs. Roberts, Crosswell, and P. M. Wet-more, who were parties thereto of the second part, agreed to build the requisite steam vessels under such contract, with their machinery, and to furnish all necessary funds for that purpose; such steamships and their machinery to be built or constructed, under “ the superintendence, direction and ‘control’” of the defendant; by it the vessels when built were required to be registered in the names of the defendant, and Messrs. Roberts and Mcllvaine, who were parties thereto of the third part, they were to appoint .all officers for navigating such vessels, except their commanders ; to appoint all agents for managing the business; to make all contracts for the employment of such .vessels; to receive their freight and earnings, and all sums due for transportation of the mails, and disburse all moneys. By such instrument it was also made the duty of such trustees to render quarterly accounts of their -receipts and .expenditures, and after deducting all disbursements to pay a certain sum ($6,250) quarterly to Mr. Sloo, and a like sum to the defendant and Messrs. Croswell, Roberts, and P. M. Wetmore, jointly, and to apply the residue of sue]), net earnings to reimbursing any advances made by them, with interest, and a commission of ten per cent , on the amount of such advances; and to divide the remainder thereof, equally, between Mr. Sloo and the parties to such agreement of the second part. The defendant and Messrs. Roberts and Mdlvaine were also constituted thereby, trustees of an undivided half of such vessels, for Sloo, and of a like half for the defendant, Messrs. Roberts, Croswell, and P. M. Wetmore, jointly.
Provision was made in such instrument for appointing trustees in the place of those named therein, and an agent in the place of Mr. Croswell, in ease either of them should die, resign, or become incapable of acting; the parties of the second part thereto having the right of appointing in place of Mr. Roberts or the defendant, and Mr. Sloo that of appointing in place of Messrs. Croswell and Mdlvaine. It was also provided in such instrument, that Messrs. Roberts and Croswell should be the agents of such vessels in Hew York, and that each of them, as well as the defendant and Mr. Mdlvaine, should receive a certain salary ($5,000) for the services to be performed by them under such agreement.
It was also agreed in such instrument 0 that the trust should be closed by the trustees by a sale of the ships at public sale, and after paying expenses and reimbursing what was due to the parties of the second part and the trustees, the residue of the proceeds should be equally divided between the parties thereto of the second part and Mr. Sloo, equally. Provision was also made therein for admitting other associates into the undertaking. The trustees by such instrument accepted the trusts therein contained, and agreed to carry them out.
In October, 1847, the defendant, Messrs. Roberts, Croswell, P. M. and R. 0. Wetmore, made two written contracts for the construction of two of the vessels specified in such contract, one with Messrs. Smith & Dimon, for the Georgia, and the other with Messrs. Bishop & Simonson for the Ohio, each for the sum of $110,000, payable by installments, such vessels to be completed in one year from the contract.
In the course of the construction of such vessels, in August, 1848, a written contract was signed by the defendant, with his own name, and by the members of the firm of T. F. Secor & Co., consisting of the plaintiffs and Messrs. Breasted and Quintard, with their separate names, for the construction of four marine steam engines, with eight boilers and other apparatus complete, and putting up two of such engines and four of -such boilers in each of the before mentioned vessels. Such contract purported on its face to be made between the firm of Secor & Co., as parties of the first part thereto, and the defendant Roberts, P. M. and R. C. Wet-more and Croswell, as parties thereto of the second part. By it the parties thereto, of the first part, in consideration of the agreement of the parties of the second part therein, agreed to put up two of such engines and four of such boilers in one of such vessels, before the 9th of May following, and in the other, before the ninth of July following. Specifications were annexed to such contract, describing the materials, dimensions and other details of the work, and the whole was required to be done under the superintendence of the defendant. For the whole of such work, Secor & Co. were, by such contract, to receive from the parties thereto of the second part a certain sum, ($300,000,) by installments.
The plaintiffs’ firm did not complete the work in such contract until after the time fixed therein for its completion, to wit: In one vessel ip September, 1849, and in the other in January, 1850. At the defendant’s request, they also built some coal bunkers, and did other work connected therewith, exceeding in value a certain sum, ($11,000,) on board of each vessel.
Messrs. Breasted and Quintard, partners of the plain-* tiffs, assigned their interest in all the claims to the latter, before the commencement of this action.
The complaint originally set up three separate causes of action, to wit:
1. The reasonable value of certain work done and materials furnished by the firm of T. F. Secor & Go., consisting of the plaintiffs, and Messrs. Breasted and Quintard, at the defendant’s request, in building four steam engines and eight boilers on board of two vessels, (the Ohio and Georgia,) completed in January, 1850, on which a certain sum ($3,000) is claimed to be due.
2. The reasonable value of certain extra work done and materials furnished by the same firm on board of the same vessels, at the defendant’s request, between September, 1849, and February, 1850, claimed to exceed a certain sum, ($28,600.)
3. A balance found due on an accounting for certain work done and materials furnished on board of the same vessels, between the plaintiffs and the defendant, exceeding a certain sum, ($11,900,) for one vessel, and another sum, ($11,400,) for the other, exclusive of a certain sum, ($3,000,) due on the original contract, which sums the defendant promised to pay the plaintiffs’ firm.
Another cause of actión was added to the complaint, by way of amendment, by leave of the Beferee, on the trial, after the testimony was closed and the cause submitted. In it the defendant is alleged to have been indebted to the plaintiffs’ firm in a certain sum, ($3,000,) for a balance due on an amount agreed by him to be paid for the construction of certain steam engines and boilers, to be placed on board of the vessels in question, and a furthér sum exceeding a certain amount, ($28,600,) for other work and materials put on board of such vessels, and for certain wharfage: that the defendants claimed damages for the non-completion of the work within the time agreed upon, and finally that an accounting took place of such amounts and damages, and a balance was found due to the plaintiffs’ firm, amounting to near a certain sum, ($26,300,) which the defendant promised them to pay.
The complaint contains proper averments of a release by Breasted and Quintard of their interest to the plaintiffs.
The defendant, in his answer, denies that any such work or materials as were described in the complaint were done at his request, or that he promised to pay for them, or that they were worth the amount claimed; but he alleges, if done or furnished, they were so done or furnished for him, jointly with Messrs! Roberts, Croswell and the two Wet-mores, who were jointly interested in such vessels, and that the plaintiffs were paid therefor.
The answer also claims that Roberts, 'Croswell and the two Wetmores should be made parties, and that the complaint is for that reason defective.
Such answer, further, by amendment, takes issue on all the facts stated in the amendment to the complaint.
It also contains a claim or set-off for damages to a certain amount, ($30,000,) for the failure of the plaintiff to complete the work undertaken by him in the original contract within the time therein fixed, and a like sum for a similar failure under a similar contract with the defendant alone. The defendant prays judgment that such sums may be deducted from, or set off against any sum recovered by the plaintiff in this action.
The plaintiffs, in their reply to the original answer, take issue upon all new matter therein constituting a new claim; they also therein allege the contract set out in the complaint to have been made with the defendant alone, and not with him and the other persons mentioned in the answer; also, that both the contracts therein mem tioned were entered into with the understanding that the time should be extended as long as was necessary, to enable the plaintiffs’ firm to complete the work; also, that in consideration of the premises, and the agreement by the plaintiffs’ firm to do the extra work mentioned in the complaint, the defendant extended the time for the completion of the work under the original contracts, and that when completed, the engines and appurtenances constituting such work were accepted by the defendant as a full performance, by the plaintiffs’ firm of their contract. The reply also contains, as a separate defense to the counterclaim or set-off set up in the answer, an accounting had between the plaintiffs’ firm and the defendant, of the amount due to the former, and that claimed by the latter as damages for the delay, and that the excess due for the former over the latter was agreed upon between them, and was the sum claimed in the complaint.
The issues of fact in the action were tried before Robert Emmet, Esq., to whom the same were referred for trial.
The Referee found, by his report, the making of the original agreement with the Secretary of the Havy, the assignment of such agreement to the defendant and others, also the other contents of the instrument in writing, before mentioned, containing such assignment; the assumption by the defendant of the superintendence of the construction of the vessels in question, the contracts for their making, before mentioned, and an employment by the defendant, of the plaintiffs’ firm, to make the engines and boilers for such vessels, and the signing of the contract with the specifications, before mentioned, for such work, by the defendant. He also found that the actual price verbally agreed upon between the plaintiffs’ firm and the defendant for such work, at the time of such contract, was a less sum ($270,000) than that set out in the complaint, ($300,000,) and a written receipt was given by the plaintiffs for the difference, ($30,000,) without anything being paid. That it was also simultaneously verbally agreed that a certain part ($45,000) of the price of such work should be paid by a conveyance by the defendant to the members of the plaintiffs’ firm, of a piece of land on the southerly side of Mnth street, in the City of Hew York, and a separate written agreement to that effect, signed the same day.
The Referee also found, in and by such report, that none of the members of the plaintiffs’ firm, at the time of signing the contract with the defendant, knew or were informed of any interest of Messrs. Roberts, Croswell, or the two Wetmores, or either of them, in such steamships, further than by seeing their names therein; and that in all transactions, after signing such contract, the plaintiffs’ firm dealt wholly with the defendant; and had no actual dealings or communications with, and received no directions or payments from any of such parties.
The Beferee further found by his report, that the plaintiffs’ firm completed their work under the defendant’s superintendence, without unnecessary delay. That the plaintiffs’ firm did a large amount of extra work in both of such steamships; and that the times limited in the original contract were insufficient for the performance of work; but were inserted at the defendant’s request, in order to enable him to satisfy the United States Government, that he had made a contract to comply with his arrangement with them; that the completion of the work was delayed by the want of decision of a superintendent employed by the defendant, by attack of cholera among the workmen employed, and by the breaking of a derrick, but not by any fault or negligence of the plaintiffs’ firm. Such Beferee further found the times at which the contemplated work was completed.
The Beferee further found that the work and materials on both vessels were accepted by the defendant; also, that the defendant paid to the plaintiffs’ firm, in cash, at various times to a certain date, (21st of April, 1849,) on account of the contract with them, a certain sum, ($135,000;) executed a conveyance to them, on like account, of the property in Mnth street, in May, 1849, for a certain sum, ($45,000,) and gave them, on like account, fifteen promissory notes made by him, payable at five and six months, after date, without interest, at various times from June, 1849, to February, 1850, amounting in all to the sum of $87,000.
The Beferee also found in and by his report, that in the spring of 1850, after all the work had been done, and materials furnished by the plaintiffs’ firm, which they had been employed by the defendant to do, they demanded of him the residue due on the original contract, and presented their bills for extra work, exceeding the sum of $28,500; that the defendant objected to some of the items of such bills, and claimed damages for non-completion of the work within the time, and an accounting was then had between the plaintiffs’ firm and the defendant, of and con cerning all the matters aforesaid, and the moneys due by the latter to the former on the original contract, and the extra work and the damages claimed ; and after making allowances for such damages, and other deductions claimed by the defendant, the amount due to the plaintiffs’ firm was liquidated and agreed upon between them at the sum of $26,295.79, which the defendant, in consideration of the premises, agreed to pay the plaintiffs’ firm.
The Referee also found, by such report, that the defendant rendered to the trustees named in the before mentioned assignment in trust, his account for his expenditures on account of the work done upon such steam vessels, in which he charged as cash paid by him, the sum allowed to him by the plaintiffs’ firm for the property conveyed to them by him on Ninth street, at the date of such conveyance, and the amount of the notes given by him in satisfaction of the amount due on such contracts at the date of such notes ; that he accounted with such trustees respecting all his disbursements on account of such undertaking, including interest on the amount of such notes from the time of their date, and was paid the same from the trust fund; that he did not inform such trustees that he had not paid such sums in cash ; and that in such account so rendered by him was contained an item of a certain amount, ($25,588.99,) which the co-trustees and associates of the defendant agreed should be allowed to him on such accounting, as cash paid by him, he agreeing to assume to pay to the plaintiffs’ firm the residue due to them on the original contract, and for extra work, in consideration whereof such amount was allowed to and paid to the defendant by such trustees. The Referee further found that such last mentioned sum or item consisted of the amounts claimed for extra work done on such vessels by the plaintiffs’ firm and shop work, with the sum ($3,000) remaining unpaid on the original contract, less certain sums claimed to have been paid by the defendant to various persons.
The Referee, also found, as a fact, that notice was given by the defendant to the plaintiffs’ firm on occasion of each of the payments made by him to them, that he did not intend thereby to waive his claim for damages for not completing the work in time; and receipts for such moneys were given by the plaintiffs’ firm written upon such notices, and upon the terms therein specified.
The Referee adopted, as conclusions of law:
1. That no conversations between the plaintiffs’ firm and the defendant, as to the time limited for the completion of tfye work in question, could vary the terms of the written contract for such work, and that nothing said prior to its execution could affect the claim for damages for the delay.
2. That the claim for such damages having been included in the accounting between the parties, in 1850, and then allowed for, the defendant could not now set up any claim therefor.
3. That the accounting between the defendant and his associates, in the year 1850, and the allowance and payment to him of the sum then paid to him, ($25,588 99,) and his promise to pay the plaintiffs’ firm the amount agreed upon, constitute an answer sufficient in law to the defense of any non-joinder as defendants of those who were associates in the building of the steam vessels in controversy.
4. That the plaintiffs are^ entitled to recover of the defendant the sum of $45,143.27.
Exceptions were filed to the finding of facts of the Referee, by the defendant, including most of the facts found by him, and particularly as to the separate employment of the plaintiffs’ firm, by the defendant, the ignorance of the former of any interest in any other person except the defendant, in the contract, otherwise than by the insertion of the names in the contract, and the exclusive dealing by them with him; the non-occurrence of any delay by the plaintiffs’ firm in completing the work within time; the accounting by the defendant with the plaintiffs’ firm and his promise to pay; the accounting-by the defendant with his associates, his receipt from them of the sum charged, and his promise to them to pay the plaintiff and his firm.
Various requests were made on the trial, to the Eeferee, to decide various points, including the defect of parties by the non-joinder of the persons named in the answer; the right of the defendant to recover damages * and a supposed defect arising from the non-joinder of Horace F. Clark, Esq., as joint plaintiff, by reason of a supposed interest in the action. Various requests were made by the defendant’s counsel, to the Eeferee, to insert various other findings of fact, with which he refused to comply, and exceptions were filed to such refusal.
Exceptions were taken by the defendant to the admission of evidence to establish the following facts, viz.: 1. That the original contract price for the machinery was a less sum than that mentioned in the complaint * 2. That the receipt for the sum of $30,000, given at the time of making the contract, was so given without the payment of any money; 3. That the Trustees and others interested in the vessels in question, were ignorant that the defendant had paid part of the contract price by land and in his notes * 4. What the consideration was for a release by Sloo to the defendant, the latter being under cross-examination * 5. The inconsiderable character of work done on another vessel while this contract was running, which was offered after testimony of the defendant had been admitted j 6. That the work on such vessel was productive of delays in completing the machinery of those in question; and, 7. That the contract for doing such work was made after the contract in question.
Bequests were made by the defendant’s counsel, to the Eeferee, on settling the case, to alter his findings of fact, which he refused, except as to an immaterial finding, and exceptions were taken to such refusal.
Other facts, material to the case, appear in the opinion of the Court.
H. Goodman and H. W. Robinson, for the defendant, (appellant.)
I. Defendant was entitled to judgment upon his defense that the work, &c., were done and furnished for him, jointly with. Roberts, the Wetmores, and Croswell, and that they were necessary and proper parties; the complaint was defective in consequence of their omission.
(1.) As co-owners they were liable, jointly or in solido, for the engine, boilers, and other tackle and furniture necessary for the completion and fitting out of the vessels. (3 Kent’s Com., [4th ed.,] 154, 156.)
(2.) AH rights growing out of the contract as against T. F. Secor & Co., for delay in completing the engines and boilers, belonged to them as such joint owners.
(3.) The contract with T. F. Secor & Co. was expressed to be made with them jointly.
(4.) The defendant having acted for himself "and his associates jointly, the burden of proof rested on the plaintiffs to show that his acts were without the authority of his associates. (Chit, on Cont., 227.)
(5.) No signature by them was .necessary to give the.contract effect as against them. (Chit, on Cont., 71; Clason v. Bailey, 14 Johns., 484.) And the signing by defendant alone, in the avowed and known business of himself and his associates, did not render it his individual contract. (Chit, on Cont., 249 ; 3 Kent’s Com., [4th ed.,] 41 to 44; 1 Pars, on Cont., 162; Chit, on Bills, [11th Am. ed.,] 57, note 2.)
(6.) It would have been a breach of duty on Ms part to have contracted or acquired any rights, individually, in relation to the joint business of himself and his associates, and, by the declaration in the contract, he expressly disclaimed any such individual responsibility. (Story on Part., § § 177, 178.)
(7.) The trust deed provided that these vessels should be built by the associates, and that defendant should merely have the superintendence, direction, and control of the construction.
(8.) Every presumption of law was, that the parties intended to act in conformity to the known rights of all parties concerned, and that all dealings with the defendant within the known scope of the joint interest of himself and other parties, were on joint account. (Story on Agency, §§ 37, 124; Smith’s Mer. Law, [ed. 1843,] 93; 3 Kent’s Com., 43; Willet v. Chumbers, Cowp., 814; Alexander v. Barker, 2 Cromp. and Jer., 133; Cro. Car., 550.)
(9.) It is no objection that this "defense was united with defenses upon the merits. (Sweet v. Tuttle, 4 Kern., 465.)
II. The Referee erred in neglecting to find, one way or the other, upon the issue of fact presented, whether or not the contract was made by the defendant jointly with his co-owners in the vessels, and as required by the issues and particularly requested; and in holding “that the “accounting between the defendant and his associates, “ and the allowance and payment to him of the sum then “ paid to him by them, and his assumption to pay the “ balance due T. F. Secor & Co., and Ms promise to them “ to pay' the amount agreed upon, on the accounting “ between him and them, constitute an answer, sufficient “ in law, to the defense of non-joinder.”
(1). The finding of fact on which this conclusion is based, that the said defendant, after the account of the cost, &c., rendered by him tp the trustees, had an accounting with his associates, &c., is unsupported by the evidence. The accoxmt presented by Mm was rendered to the Trustees under the Sloo Trust.
Although assented to by the trustees, it in ho manner concluded the co-owners as to their liabilities, as between themselves, for the unsettled claims.
The item (of $25,588.99) stated in this account as the balance of the claim of T. F. Secor & Go., and as part of the cost of the vessel, was in no manner represented by the defendant as a disbursement that had been actually made by Mm individually, or by him and his associates jointly. Its true character was explained, and the assumption by him, (to which plaintiffs’ witnesses testified,) was only “ as far as the trustees were concerned;” if the amount was to be charged thereafter, it was a matter to be settled between the co-owners and associates,
There is no evidence how this outstanding claim was ever (if at all) arranged between them, or that it ever entered into any computation or adjustment of their accounts as between themselves.
Eo occasion was shown when there ever was a meeting of the associates, or when any such assumption was made by the defendant to or with them.
It appears, on the contrary, that the expected settlement of that item, by an offset of the damages sustained by the co-owners, by reason of the delay in finishing the engines and boilers, was intended to be made for the benefit of the associates.
(2.) But even a subsequent, receipt by defendant of full contribution from his associates for this item, and his agreement with them that he would individually pay it, would not modify the rights of the parties, under the original contract. (1 Saund. Pl. and Ev., 17; Lodge v. Dicas, 3 B. & Ald., 611.)
(3.) If such an agreement inured to the benefit of T. F. Secor & Co., it could only furnish a new cause of action against the defendant individually.
Eo such cause of action was alleged or could be considered by the Referee.
III. The Referee erred in admitting in evidence, on the part of the plaintiffs, various irrelevant matters, which could not fail to have prejudiced his mind against the defendant, in his relation both as a party and witness.
IV. His report, in various respects, evinces a bias against defendant, or an incorrect appreciation of the evidence.
V. He erred in finding, as matters of fact, that plaintiffs duly performed.
VI. He erred in finding, as matter of fact, that, on the liquidation of the amount due on the bills of T. F. Secor & Co., for the work in question, an accounting was had, and that, after making allowances, by reason of damages for delay, and other deductions claimed by the defendant, the amount was ascertained.
The damages were a proper subject of counterclaim, although they belonged to defendant and his associates. (Platt v. Halen, 23 Wend., 456.)
VII. He also erred in the finding of fact mentioned under point II above.
VIII. The Referee erred in allowing the plaintiff to amend his complaint by adding a new count.
He had no authority to allow the addition of a new cause of action to those previously stated in the complaint. (Union Bank v. Mott, 10 Abbott’s Pr., 372; Edw. on Ref., 33.)
His power was limited to such amendments as are defined and limited by § 170 of the Code.
IX. The exceptions to the report of the Referee, and also those taken to his refusal to find as requested by the defendant’s counsel, were well taken.
Horace F. Clark, for plaintiffs, (respondents.)
I. The dealings were between Secor & Co. and defendant in his individual capacity. Roberts and others, although interested, were not contracting parties.
II. The original employment of Secor & Co., and the bargaining with them, was by defendant personally, and at that time no mention was made of any other parties, as being interested.
The circumstances, that Roberts and others were interested and that their names were introduced in the contract presented, are overcome by the facts that Roberts and others did not sign the contract; that defendant alone signed it; that he alone made the payments under it; and by the mode of such payments and of his accounting, of his receipts of a balance and his undertaking, all of which show that he treated such agreement as an individual undertaking of his own.
III. It appears in evidence that the construction of the engines of the “Ohio” and “Georgia” was a separate undertaking of the defendant, and that Roberts was not one of the contracting parties. The defense of non-joinder must, therefore, fail.
IV. Had the contract in question been the joint contract of the defendant, Roberts and others, the plaintiffs, would, nevertheless, have been entitled to recover' against Law alone.
(a.) The liquidation of the account between defendant and Secor & Go., the abatement of a portion, the allowance of promissory notes as cash payments; the express assumption of the balánce by the defendant, in connection with his receipt of such balance from his associates, and his promise to them to pay the plaintiffs’ claim, created a liability independent of the original contract, which liability could be enforced in this action.
(b.) Contribution having been in fact' made by the associates of the defendant, and his account with them settled on the basis of his individual assumption of the obligation to the plaintiffs, he has no right to demand that his associates should" be sued, even thoujgb possibly the plaintiffs might, at their election, have been entitled to maintain an action against all the parties in interest.
: V. The finding that the claim for damages for delay was allowed for in the settlement between the defendant and ■Secor & Co., is fully supported by the evidence.' ■ '

Opinion:
Robertson, J.
The defendant's objection of want of proper parties, is confined to the original contract for building and putting up the machinery in question, and the •additional work and materials furnished by the plaintiffs' •firm, and does not extend to any subsequent valid undertakings of his. The plaintiffs'reply sets' up, apparently, four defenses to. the claim for damages in the answer, besides a general denial that any damages arose from the cause assigned, to wit: 1st. A cotemporaneous agreement •to extend the time, from the impossibility of completing the work within that fixed therefor. 2d: A subsequent agreement to do so in consideration of extra work to be done by the plaintiffs' firm. 3d. An acceptance, by the •defendant, of the engines and boilers, when completed, as-.a full performance of the contract; and, lastly, the inclu sion of such damages, in an accounting, and a balance agreed upon after allowing the same, being, the same accounting as that set out in the third cause of action in the complaint.
The Referee has not found, distinctly, with whom the plaintiffs' firm agreed to do the work in question, nor to whom they gave the exclusive credit; he has, however, found that the defendant employed such firm to do such work, and that the contract in writing, although purporting to have other persons parties thereto, who are named therein, was signed only by the members of the plaintiffs' firm and the defendant; also, that by a simultaneous agreement, a piece of land was agreed to be taken by the plaintiffs' firm as part of the price of such work, under a conveyance from the defendant;, and that, in all subsequent transactions, the plaintiffs' firm dealt wholly with the defendant, and neither dealt with, nor received communications from the persons named in the answer. That the defendant paid part of the contract price by a conveyance of the land agreed upon, and obtained .a credit op, the payment of other installments, by the delivery of his promissory notes therefor, at five and six months without interest ; while he charged his associates with the land and promissory notes as cash paid, and drew interest on the latter, in a settlement with them.
Moreover, there is direct testimony that the defendant is the only person with whom the plaintiffs' firm dealt in such contract; the land conveyed belonged to a bank, in which the defendant had a large interest and. of which he was president, and in which there is no "proof that any of his associates had any interest; he claimed to give his promissory notes without interest, because the contract was not completed in time. Receipts for such notes are annexed to notices of non-waiver, signed " George Law & Co;" which speak of "my rights and claims under your contract with George Law, &c."- Such receipts are in favor of the defendant alone, there being no evidence that any such firm as George Law & Co. ever existed. .The evidence, which is considerable, of dealings exclusively between the defendant and his associates, tending to show that, as between them, the former was considered as the contractor, is, of course, not to be regarded on this question of giving credit, as the plaintiffs' firm were not parties thereto; although it may be available for other purposes.
. It would be very difficult to say, from the testimony in this case, if the contract was not made exclusively with the defendant, with whom it was made. There is no evidence of any authority given to him to bind any person thereby, except the parties to the original assignment in trust, unless the mere joint ownership by himself, and the parties named in the answer, of the hulls of the vessels, entitled him to incur a debt of $309,000 for machinery to put on board of them, so as to convert them into steamboats. The written contract was signed by the defendant alone, and although, possibly by its form, it may have given all the persons named in it a right of action against the plaintiffs' firm for a breach of their obligations contained in it, it gave none to them against any one but the defendant. If such contract can be laid aside, and we are at liberty to go into an inquiry as to the persons for whose benefit and by whose authority it was made, Ave shall find, unless we go back to the assignment in trust, that the only authority of the defendant consists of his joint ownership of such hulls. There was no agreement of any kind proved between the defendant, Roberts, Cros- , well, and the two Wetmores, as between themselves, that they would complete the vessels as steamboats for any purpose, although they jointly agreed with others that they would do so, as they also did with others, to build the vessels. If they had so agreed, as between themselves for th.e purpose even of carrying out the contract with Sloo, there might have been such a joint enterprise, and to such extent as to have entitled any of the partners in it to bind the others by á contract to do what was necessary to complete it or carry it on. (Staats v. Howlett, 4 Denio, 559.) If the joint enterprise, (to which the "completion of the vessels as steamboats, by placing machinery therein, was essential,) was that which was entered into by the assignment in trust, the defendant had as much authority to bind Mr. Sloo, who was to own equitably one-half the boats, and be entitled to half the profits, and Mr. McIIvaine, who was to be the owner at law as joint tenant of one-fourth of them, and to be entitled to a yearly salary of $5,000 from their earnings, as he had to bind any of the parties who undertook to build them. In such case both of them would be necessary parties to the suit, while Mr. B. 0. Wetmore would have no interest in it; and if the objection for want of parties, as taken, be governed by the same rules as a plea in abatement, it must be overruled.
But it is said that the joint ownership of the hulls entitled the defendant to equip them as steamboats with proper machinery. I have not been able to find any authority which goes so far as to hold that the joint owners of a hull, which has never been used for a steamboat, are authorized as agents for each other to make contracts to convert it into one, by building machinery and putting it on board, however fitted it may be for such use, or unfit for any other. They are but tenants in common of it, not partners, (Nicoll v. Mumford, 4 Johns. Ch., 522,) and whatever may be their rights as such, to prevent it from being destroyed in the form in which it has been completed, for want of repair, they do not extend to so material and expensive an alteration of its character as placing steam engines on board at the expense of all, without the express agreement between the owners, which would make it a joint enterprise.
The findings of the Beferee, however, and the evidence already alluded to, justify us in arriving at the conclusion as a fact, that exclusive credit was given to the defendant by the plaintiffs' firm in all the contracts between them. One of that firm testifies that " he supposed those men- tioned in the contract were interested in the engines, but " as Mr. Law only signed it, he was the only party with " whom ive ivere dealing, we considered him good enough." The contract was signed, by the defendant with his own name only, not professing to act for any. one else, agreeing thereby to pay certain sums on certain days. By a cotemporaneous contract, he agreed to convey land in which he alone was interested, as part of the price of the machinery, without proof of any consent on the part of any associate to take it at that price. Notices were subsequently given by him, signed with his own name, and the addition of " & Co.," there being no proof of any person carrying on business in that firm name. In them he speaks of .".my rights and claims under your contract," not with us, (which might have identified the firm or partnership intended,) , but with " George Law, &c." Upon those notices receipts are given to the defendant for his own promissory notes, running at long dates as cash; and it is proved that he induced the plaintiffs' firm to give him the credit on those notes, by representing that he had suffered damage by the delay in the work, while he himself was in fact allowed interest on them as cash payments in his dealings with the parties jointly interested in them. All dealings and communications in relation to the subject of the contract are had with him only, he alone had the direction and superintendence of the work, and he finally adjusted the account and promised to pay it. Even without reference to. the doubtfulness of the defendant's authority to bind any one else, and the probability of the plaintiffs' firm preferring the certainty of taking one paymaster, whom they thought good, instead of the uncertain liability of others, the Referee would have been warranted in finding, from the facts so proved, that exclusive credit was given to the defendant in all the contracts; and we are entitled to supply that finding, if necessary, to sustain his report. (Grant v. Morse, 22 N. Y. R., 323.)
There is no need of authority to show that exclusive credit may be given even to one of several partners, so as to make him individually liable, as readily as though he had indorsed with his own name a promissory note of the firm, or otherwise guaranteed their responsibility; and more particularly where, as in this case, the form of the contract notified the plaintiffs that there were other parties interested. There is much more reason for making a partnership liable on a contract made for their benefit by a partner in his own name, where he conceals their interest, than where he discloses it. The very fact of taking tho contract in such case in a form to bind him only, is almost conclusive evidence that the other contracting party did not intend to look to the partners. As, therefore, the evidence in this case would be abundant to establish, in an action against the persons named in the answer, a defense by them that the contract was exclusively the defendant's, and not theirs,- there is no error in the Referee's conclusion on that point.
Even, however, if no such fact appeared in the case, upon the first written contract, the defendant made himself liable by signing it; there was sufficient consideration for the obligation, and there was no proof that he did not intend to be bound until others signed it, (Parker v. Bradley, 2 Hill, 584,) nor did he sign it, nor was he described in it, in any representative capacity. (Lincoln v. Crandell, 21 Wend., 101.) The rule of law, that his signing it does not prevent the plaintiffs from reaching his principals, where the contract is by parol, (Chitty on Cont., 249; 1 Pars. on Cont., 162; 3 Kent's Com., [4th ed.,] 41-44,) will not the less make him liable, in such a case, upon it as surety, as much as though he had indorsed their notes.
I am by no means satisfied that the defendant has not waived his objection of non-joinder of parties, by setting up a' counterclaim in favor of the same parties against the plaintiffs. Such a claim would clearly be inadmissible, if the claim of the plaintiffs were against the defendant alone; and yet, if both the objection and counterclaim are to prevail, the defendant can avail himself of an action which he claims cannot be maintained, in order to recover a claim which could only be sued for in an action, by those whose absence as parties to the suit, he alleges makes it defective. The Code does not provide for objections to a counterclaim for want of parties, nor how such a defect is to be taken advantage of, while the .case of Platt v. Halen, (23 Wend., 456,) warrants an offset, notwithstanding a defect of parties. That would prevent the answer from being demurrable, and if it is a good pleading, clearly the defendant would be entitled, on proving the facts contained in it, to judgment therefor, whatever was the fate of the plaintiffs' claim. A pleading, therefore, which seeks to defeat the plaintiffs' action, upon facts which alone entitle the party pleading to make the claim which he sets up in such action, is at least an anomaly. The result of a successful objection, for want of parties, is not a total defeat, but only an abatement of the plaintiffs' action, while the defendant may obtain absolute judgment for the claim, against which, in an action brought directly upon it, the plaintiffs would have a right to offset their claim now in suit.
From the testimony of a clerk of the trustees of the vessels in question, under the assignment from Sloo, it appeared that the defendant was paid by them a certain sum, ($25,588.99,) charged by him in an account, to reimburse him for that sum, as due to the plaintiffs' firm. At the time, as such witness states, " It was stated by the " defendant that that sum was a disputed item^between " himself and the contractors for the engines of the Ohio " and Georgia; when the matter was settled a " voucher was to be produced " from the plaintiffs' firm; " he was to procure it," Another witness (Kirby) testifies, that these vessels, with another, were subsequently transr ferred to another company, to the extent of the interest of the defendant and others therein, for a sum which included the disbursements of the defendant for the construction of the engines and extra work, according to his account rendered to the trustees, he being then their constructing agent. That in June, 1850, during the examination of such accounts, the defendant said: " that inas- " much as the construction- had all been paid for, except " as to that one item, the account had letter le closed, so "far as the trtistees were concerned, and he would assume the " settlement of that item with Mr. Secor." Another witness (Mcllvaine) testifies, that the defendant desired such item to appear on the books of the trustees, as part of the cost of the engines, in case the United States Government desired to purchase the vessels, and " that if this sum was " never paid to the contractors, he would then pay that part " of it which belonged to Col. Sloo, under the deed of " trust to him." lit the account rendered by the defendant to the trustees, which was carried into their accounts, the disputed item was entered as paid on the 17th of June, 1850. Another witness (Roberts) states, that when such item was spoken of in the examination of the accounts, as having no voucher, the defendant said " he would " arrange it," and it " was credited to him as a payment by " him." The same witness subsequently adds, that the defendant " said he tvould get the voucher for such item, or " be responsible for it." This evidence is amply sufficient to sustain the finding of the Referee, that the defendant accounted with the trustees concerning his disbursements for the construction of the engines and other machinery for the vessels in question, and was allowed the s.um due the plaintiffs' firm in settlement of such accounting, and paid the same; and that in consideration thereof, he assumed individually to pay the plaintiffs' firm the amount so due to them.' This would enable the plaintiffs to maintain an action on that promise against the defendant alone.
The defendant being individually liable for the claim of the plaintiffs against him, the next question which arises is whether he had any claim for damages which could be deducted or set off. The work, coneededly, was not finished within the time agreed upon, and if nothing was done to waive the claim for damages therefor, it still remains. A difficulty might arise as to the right to set it off, if the plaintiffs' claim be against the defendant alone on an individual liability. It might be available as a recoupment in mitigation of damages, but the answer does not claim it as such. (Nichols v. Dusenhury, 2 Comst., 283; McCullough v. Cox, 6 Barb., 386.) The parties who were prejudiced by the delay consisted of all the owners of the vessels, and the defendant could not recover and retain such damages as entirely his own on an independent cause of action. In addition to this, the claim in .this case was for a sum certain, and belonged only to the two plaintiffs; the claim for damages was unliquidated, and was against the plaintiffs and two others, who were not parties to the action. It would seem, therefore, that, Although the plaintiffs acquired half their interest by assignment, the defendant would have no right to make them alone liable for his claim for damages, (Vassear v. Livingston, 3 Kern., 248,) by way of counterclaim under the Code. (Dillaye v., Niles, 4 Abb., 253; Ferrerira v. Depew, Id., 131; Davidson v. Remington, 12 How., 310; Van de Sande v. Hall, 13 Id., 458; Spencer v. Babcock, 22 Barb., 327.) It does not appear, also, that the claim would be available by way of set-off. The 112th section of the Code has been held not to affect the substantial rights of assignor and assignee as to set-offs under the Eevised*Statutes, (Beckwith v, Union Bank of New York, 5 Seld., 212, affirming 4 Sandf., 610,) and unliquidated damages are not a subject of set-off. (Brown v. Cuming, 2 Cai., 33; Hepburn v. Hoag, 6 Cow., 613; Wilmot v. Hurd, 31 Wend., 584.) Bat there is sufficient in the record in this case to defeat such claim on the merits.
The Beferee properly disregarded the evidence offered to vary the written contract as to the time of completing the work provided for in it, although the defendant claimed the right to reject such written contract, and to hold the plaintiffs to some other contract made by him on behalf of the owners of the vessel; and if the plaintiffs yielded to the proposition of the defendant to deceive the United States Government, by the insertion of a time within which the work could not be done, they would be justly punished by being made to pay damages for lending themselves to the deception, as the defendant would, for thq same reason, have been, by being compelled to pay the fictitious $30,000 added to the price for the like purpose of imposition.
The facts that plaintiffs and defendant agreed, originally, that the time was fixed in the contract for a different purpose; that the defendant superintended the work while it was going on, and lent the plaintiffs' firm his notes for $7,500, to be applied on account of the moneys to grow dne under the contract, without objection to the non-completion, on the 29th of June, 1849, over a month after the machinery for one vessel was to have been finished; that a variety of misfortunes interfered to prevent a completion of the work in time; that the plaintiffs worked diligently to complete it; that there is no evidence of the communication by the defendant of such claim for damages to the other trustees; that the defendant took a receipt for his notes, without interest, on a notice of a claim of damages,— although no legal excuse for the delay, each tend to diminish any improbability of the defendant's having waived a claim for damages, or accepted such credit on the notes, and other deductions from the bills, as a sufficient compensation. The liquidation of such damages and its merger in the account stated between the plaintiffs' firm and the defendant, after the work was done, and in March or February, 1850, mainly rests upon the testimony of one witness, (Mr. Breasted,) who now has no interest in the action, which is only opposed by that of the defendant. From that testimony it appears that the defendant, on the rendition of the accounts, stated to the plaintiffs that they were behind hand in the work, and he was not going to allow them all the bill; that he was not going to pay wharfage during the delay, and directed them to take out the items complained of and he would settle the bill; those items were taken out as a compromise of the matter, and to close the thing up a new bill was made out, and be said " he would pay the hills." The witness testified " that this was a general settlement and compromise of every thing." This is corroborated, as to the promise to pay, by the testimony of another witness, (Quintard,) who testifies that the defendant said the bills would be settled after they were regulated; and that of the plaintiff, Secor, who testifies that after the new bills were sent in the defendant said " it was all right and he would pay the bills." The first witness (Breasted) testified, also, that on a previous application by him to the defendant, when he gave his notes, the latter said " that the plaintiffs' firm would be "behind time, and he therefore'should give notes instead "of money." If this were an agreement to waive the performance of the contract in time, provided the plaintiffs gave time on the payments, as it might well be construed to be, the defendant would have no claim for damages, 'and might well be disposed to waive any claim for them after-wards in the final settlement. Taking the testimony together, this Court is not at liberty to say that the Referee was not warranted in coming to the conclusion that the defendant, in his anxiety to close the matter up and be able to arrange the accounts and contracts with the trustees, under the original assignment in trust, either waived all claim for damages, or considered the advantages he obtained in the settlement equivalent thereto; as well as for the same reasons took upon himself alone the burden of paying the plaintiffs.
The defendant objects that the Referee erred by allowing the amendment to the complaint containing a new cause of action. By § 272 of the Code, he has the same power as the Court on a trial; and that, by % 173, extends to inserting allegations material to the case, as well as conforming the pleading to facts proved. In this case the substance of the amendment was already in issue,.being contained in the original reply to the defendant's defense qr set-off of a claim for damages. (Hall v. Gould, 3 Kern., 127.) What was already in the complaint was necessarily part of the amendment, which the court, on application, would undoubtedly have permitted to be added, as the only effect and object of the amendment was to get rid of a technical objection of want of parties. Perhaps a trial is the best place to investigate the good faith of an amendment. (Travis v. Barger, 24 Barb., 627.) The provisions of the Revised Statutes which are not superseded by the Code, (Perry v. Tynen, 22 Barb., 137,) give full power to make such amendment, (2 R. S., 424, § 1,) besides this, the defendant waived the objection, by amending his answer. I think, however, the amendment was within the discretion of the Referee, and was properly permitted.
Many facts found in this case by the Referee, being immaterial to the issue or the result, may be rejected without injury, particularly where, as in this case, he states those upon which he exclusively relies to justity his final conclusions of law that the plaintiff is" entitled to recover; he puts that solely upon the two accountings which he finds to have taken place, as matter of fact, and that, as matter of law, they excluded the objections of the non-joinder of parties and the claim for damages.
Several exceptions were taken to the admission of testimony, claimed to have been improperly admitted, none of which are tenable. Proof of the non-payment of the $30,000, at the date of the contract, was relevant for several purposes. A receipt for the amount was produced by the defendant; no charge was made by him for it in his accounts rendered to the trustees, and without an explanation there might be some embarrassment as to the amounts claimed. I do not find in the evidence any attempt to throw any imputation upon the defendant, of an improper motive for such fictitious addition, except that to which the simple fact gives rise; although the defendant did offer evidence casting the imputation of primary guilt on the plaintiffs, without removing his own complicity in it. Attempts to introduce improper evidence, which were defeated by its exclusion, could hardly affect the mind of the Referee unfavorably to the defendant. The fact that the other trustees were ignorant that the defendant obtained credit on the installments by giving his notes, or conveyed land instead of paying money, was important to show that he considered the contract entirely his own, to deal with as he thought proper, and that the arrangement of paying in land or giving time, both on the contract and the payments, was entirely a matter of his own and for his own benefit. The consideration of the release from Sloo to the defendant was admissible, in the discretion of the Referee, on a cross-examination, to test the accuracy of the witness' previous statements. The statement of the inconsiderable character of the work done by the plaintiffs on another vessel, was rendered proper by the attempt on the defendant's part to prove that the undertaking of such work by the plaintiffs, had interfered with the work to be done by them under the contract in controversy, and to diminish the damages which might be claimed for a willful delay. '
There being, therefore, no errors of law in the decision of the Referee, and there being sufficient evidence to jus-tify the facts expressly found by him, and all other facts •necessary to sustain the judgment, it must be affirmed with costs:
Bosworth, Ch. J., and Morcrief, J., agreed in affirming the judgment.