Case Name: Allen et al. v. Gregg, to use of McCandless
Court: Supreme Court of Pennsylvania
Jurisdiction: Pennsylvania
Decision Date: 1888-11-05
Citations: 1 Monag. 257
Docket Number: No. 115
Parties: Allen et al. v. Gregg, to use of McCandless.
Judges: 
Reporter: Cases in the Supreme Court of Pennsylvania; being those cases not designated to be reported
Volume: 1
Pages: 257–264

Head Matter:
Allen et al. v. Gregg, to use of McCandless.
Gregg recovered a judgment on a sci. fa. sur mortgage against Allen for $24,440. Allen retained McCandless and Eckley, as his attorneys, to procure an order opening the judgment and letting him into a defense, agreeing to pay them one-half of the amount that the mortgage and judgment thereon should be reduced. By proceedings in the court below, an order was obtained opening the judgment, and reducing it to $19,086.67. The supreme court, holding that the case should have been submitted to a jury, reversed the order as to reduction and awarded a procedendo. When the case was reached for trial, Gregg and Allen agreed in writing that judgment should be entered against Allen for $30,000, $3,000 of which was to be assigned to “ McCandless, attorney for defendant, this to be in consideration of the waiver of defenses by defendant;” the land to be sold at sheriff’s sale and to be purchased by Gregg and by him to be sold to Allen’s sons, the defendants. Judgment was taken and the $3,000 assigned to McCandless, “ pursuant to settlement;” the premises were purchased by Gregg and a portion thereof sold to Allen’s sons, and, in consideration of the reduced price at which they purchased the property, they agreed in writing to indemnify Gregg against the payment of the $3,000. Subsequently Allen, claiming that the $3,000 was for his use, assigned it to his sons, the defendants; McCandless, having obtained an assignment from Eckley of his interest in the $3,000, recovered judgment in another county against Gregg, by default, for $2,173.86. Gregg paid $1,250 and assigned the contract of indemnity to McCandless; McCandless satisfied the judgment and brought suit upon the contract of indemnity. At the trial, the court below refused to permit the defendants to give evidence that the judgment of Gregg against Allen had not been reduced; that the $3,000 was for the use of their father, and by him assigned to them; and that they had no notice- of the suit upon which the judgment by default was taken and upon which this suit on their contract of indemnity was founded. The court held that, under the evidence, the plaintiff was entitled to a verdict for $1,250, with interest, apparently assuming that the assignment of the $3,000 to McCandless was to carry out the original agreement as to fees. Held, that the evidence should have been admitted and the questions raised submitted to the jury.
Stebrett, J. — The defendants were entitled to notice of the suit by McCandless against Gregg, and, not having had an opportunity of making the defense in that case, they have a right to set it up in this suit on their contract of indemnity, as fully as if Gregg were suing in his own right.
Oct. 16, 1888.
Error, No. 115, Oct. T. 1888, to O. P. Butler Co., to review a judgment on a verdict for plaintiff in an action of debt, by David Gregg, -for use of Charles McCandless, against Samuel Allen, Henry Allen and Thomas Allen, at June T. 1888, No. 239.
The facts are stated in the opinion of the supreme court.
At the trial, before Hazen, P. J., the plaintiff offered in evidence a contract signed by Robert Allen, without date, agreeing to pay Gen. Eckley and Charles McCandless one-half the amount of the reduction of the mortgage of J. McCutcheon, for use v. Robert Allen, and judgment thereon, and $100 to each whether the mortgage should be reduced or not. Objected to, objection overruled and exception. [16.]
The court also admitted in evidence, under objection by defendants, and exception, the assignment, dated Nov. 12, 1885, of Gen. Eckley to Charles McCandless, for his interest in the contract between McCandless, Eckley and Robert Allen. [17.]
The court admitted, under objection by defendants, and exception, the exemplification from C. P. No. 2, Allegheny Co., No. 521, being the case of Chas. McCandless, Robert Allen and E. R. Eckley, for use of Chas. McCandless v. David Gregg. [18.]
Robert Allen being on the stand, defendants asked the witness the following question: “ State whether or not, pursuant to the agreement entered into between yourself, on the one side, and Gen. Eckley and Charles McOandless, on the other, by which you were to pay them one-half the amount your mortgage should be reduced —state whether or not, in pursuance of that agreement, they ever succeeded in reducing the mortgage.” Objected to, objection sustained, and exception. [19.]
Defendants next offered the assignment, dated Eeb. 22, 1884, of thé $3,000 interest which Robert Allen had in the judgment, to his sons, the defendants, for the purpose of showing that the defendants are the owners of the $3,000 of the judgment which was assigned to their father, and that, being the owners of it, they cannot in any way become liable to Gregg or anyone claiming under him. Objected to, objection sustained, and exception. [20.]
Defendants proposed to prove by Robert Allen that the assignment of the $3,000 had no connection and was not made in pursuance of the agreement entered into between Charles McOandless and Eckley and himself, and that it was -a separate and distinct agreement, having no- connection whatever with the first agreement. Objected to, objection sustained and exception. [21.]
Defendants also asked Robert Allen this question : “At the time this assignment was made, of the $3,000, on the day of the settlement here in Butler, state whether or not anything was said to you or in your presence, in the presence of Mr. Gregg and McOandless, as to who was the owner of the $3,000 assigned?” This, for the purpose of showing that the assignment was for the use of Robert Allen, himself, and not for the use of McOandless or Eckley, in whole or in part. Objected to, objection sustained and exception. [22.]
Defendants proposed to prove by Henry Allen, that they did not receive notice of the pendency of the suit in Allegheny county against David Gregg, until the evening of January 11, 1887. This for the purpose of showing that they did not get notice until after judgment, or, at all events, until the same day on which judgment was taken in Allegheny county, and that they are not therefore concluded by the judgment and it cannot effect them, since they had no time to defend' against the action. Objected to, objection sustained and exception. [23.]
The plaintiff submitted the following points:
“ 1. The contract of Eckley & McOandless, with Allen, for fees, the assignment of Eckley to McOandless, the contract of Allen and Gregg, of Jan. 19, 1881, withdrawing the defense and settling the case and judgment thereon, embracing the usury, if it did, in said judgment, together with the assignment of $3,000 thereof, by Gregg, the same day, all being in writing, are to be construed by the court, and upon these McOandless was entitled to recover from Gregg in an action for that purpose. Ans. Affirmed.”. [1.]
“2. The exemplification of Court No. 2, Allegheny Co., to No. 521, January term, 1887, in evidence, shows that in that suit McCandless recovered a judgment against Gregg for $2,173; and on the contract of assignment referred to in paragraph No. 1. And that Gregg paid the same before this suit was brought. Ans. Affirmed.” [2.]
“ 3. By the terms of the contract between Gregg and the defendants, of Sept. 17, 1881, the defendants assumed and became thereby liable to pay to Gregg all he was liable for on the assignment of $3,000 to Charles McCandless, and it has been shown that Gregg paid McCandless $1,250 thereon. The defendants are bound in this suit to pay Gregg that sum, with interest thereon from the time he paid it, and this claim and his rights having been assigned to McCandless by Gregg, all of which is shown by writings in evidence, it is the duty of the court to construe these and not the jury. The plaintiff, prima facie, is entitled to recover a verdict in this action for the amount Gregg paid McCandless, to wit: $1,250, which is the amount Gregg was compelled to pay, and which the defendants assumed to pay Gregg. Ans. Affirmed.” [3.]
“ 4. This is a suit to enforce the claim of Gregg against Henry Allen, Samuel Allen and Thomas Allen, by reason of their contract of Sept. 17, 1881, and that claim having been duly assigned in writing to McCandless, McCandless as the assignee is entitled to the same extent to recover herein that Gregg is or was. Ans. Affirmed.” [4.]
“ 5. Under the evidence and pleadings, the plaintiff is entitled to a verdict of $1,250, with interest thereon from Jan. 11, 1887. Ans. Affirmed.” [5.]
The defendants submitted these points:
“ 1. If the jury find from the evidence that McCandless and Eckley, as attorneys for Eobert Allen, did not succeed in effecting any reduction of the mortgage of McCuteheon for use of Gregg v. Allen according to the terms of the contract entered into between them and him, then there can be no recovery by plaintiff in this action. Ans. This matter being wholly written is a matter of construction for the court.” [6.]
“ 2. If the jury find from the evidence that the assignment of $3,000 of the judgment of McCuteheon, for use of Gregg v. Allen, to McCandless, attorney for Allen, on Jan. 19, 1881, had no relation whatever to the previous contract entered into between McCandless, Eckley and Allen, was not made in pursuance thereof, but -was wholly independent of it; and if the jury further find that said assignment of $3,000 of said judgment was for the use and benefit of Eobert Allen and was not, in whole or in part, for the individual use and benefit of McCandless or Eckley, then there can be no recovery by the plaintiff in this case. Ans. As in the former point, this is a matter entirely for the court, all the offers being in construing papers and the record,- — writings, in other words, offered.” [7.]
“ 3. If the jury find from the evidence, or admissions of plaintiff in this case, that defendants did not have notice of the pend- ency of the suit of McCandless et al. v. Gregg, in C. P. No. 2, of Allegheny county, No. 521, of Jan. T. 1887, and did not have an opportunity to defend against said suit, defendants were not concluded by the judgment obtained against Gregg in said suit, nor by any of the proceedings therein, and are entitled to make the same defense in this action which they could have made had they been brought in on notice to defend against said suit in Allegheny county. Ans. We answer this by saying that, under the proofs that are in this case, even if they had been notified or had been present, it would have been of no benefit to them. The offers in regard to that, being in writing, are matters of construction for the court.” [8.]
“ 4. The verdict of C. P., No. 521, Jan. T. 1887, O. P. No. 2, of Allegheny county, being without the knowledge or opportunity of defendants to appear and defend against the claim on which judgment was obtained, the said defendants are not concluded thereby, and, that being the only evidence, the verdict must be for the defendants. Ans. We refuse that. The construction again is for the court.” [9.]
“ 5. If the jury find from the evidence that, by reason of Gregg failing to appear to the suit in Allegheny county to defend against the claim of McCandless therein; his permitting judgment to be taken therein by default; his failure to give notice to the defendants in this action of the pendency of said suit; Gregg’s immediate payment to McCandless of $1,250 and assignment to him of his,. Gregg’s, right of action against the Allens — that by reason of these facts and circumstances the proceedings and judgment in Allegheny county were collusive and fraudulent, then there can be no recovery in this action. Ans. That is refused. It is a matter of interpretation by the court.” [10.]
The court charged, inter alia, as follows :
[“Pending a trial before a jury, and it seems at the very term of court for which the case was on the trial list, and re'ady for trial, a settlement was made between Gregg, the assignee of the mortgage, and Robert Allen, the mortgagor, wherein Allen agreed to withdraw his objections to the sci. fa. on the mortgage and allow judgment to be entered thereon for the sum of $30,000, that being the amount of the mortgage and interest.] [12.] . . .
[“And this suit is brought to recover the amount which Gregg would have a right to recover from defendants in pursuance of the agreement between him and the defendants at the time he sold to them and conveyed to them the land; and they agreed to pay the amount which he might or would have to pay to McCandless or to McCandless for himself and for Eckley.] [14.] . . . [Gentlemen, as we intimated before reading the points, that what remained was largely for the court. The question now for you to dispose of is simply, as we think, to take the basis, $1,250, and add the interest thereto to this date from the date of payment, and that would' be the measure of your verdict.”] [13.]
Verdict and judgment for plaintiffs for $1,313.13.
The assignments of error specified the action of the court, 1-5, in affirming plaintiff’s points, quoting them; 6-10, in refusing defendants’ points, quoting them; 11, in neither refusing nor affirming defendants’ 2d and 3d points ; 12-15, the portions of the charge in brackets, quoting them; and, 16-23, the rulings on the evidence, stating the substance, but not quoting the bill of exceptions.
J. M. Galbreath, with him E. McJunkin, and J. B. Bredin, for plaintiffs in error.
The defendants having had no notice of the prior suit, are not concluded by the judgment obtained therein. Giltinan v. Strong, 64 Pa. 244; Respublica v. Davis, 3 Yeates, 128; Carmack v. Com., 5 Binn. 184; Moore’s Ap., 34 Pa. 411; 1 Greenleaf on Evidence, §§ 522, 523, 524; Lothrop v. Blake, 3 Pa. 483.
The contract between Eobert Allen, McCandless and Eckley relative to fees, except to the extent of $100 each to McCandless and Eckley, was conditioned upon their securing a reduction of the mortgage of McOutcheon, for use of Gregg v. Allen, which reduction they failed to effect.
The court below erroneously assumed, all through the trial, that the assignment of the $3,000 to McCandless, as attorney of Eobert Allen, was simply carrying out the original agreement relative to fees.
The defendants' below should have been allowed to give their offers of defense.
Lev. McQuistion, with him Thompson & Son, for defendant in error.
The entire evidence on which the plaintiff’s claim was made out was by writings and the construction of these was for the court.
The competency of the McCandless judgment against Gregg was clearly admissible. Barr v. Gratz, 4 Wheat. 213.
Those who have undertaken to save a man harmless are considered as bound to take notice of any suit against him, or perhaps as contracting to take notice, whether they have notice or not, and as agreeing to trust the person indemnified with the management of the defense, if suit is brought against him. Masser v. Strickland, 17 S. & R. 356; Kramph’s Ex’r. v. Hatz, 52 Pa. 529.
Allens were the grantees, Gregg, the grantor, by the terms of the written contract, and they personally assumed payment of the $3,000 of the mortgage assigned to McCandless, and became personally liable under Act of June 12, 1878, Purd. 1464. Gregg directed how this money should be paid. The vendor may direct how. the purchase money shall be paid, he may reserve it to himself, donate it to a public charity or may make such other disposition of it as may best meet his views, and if his vendee agrees to pay it according to such directions, he cannot set up as a defense that the vendor was under no duty to apply it in such manner. Merriman v. Moore, 90 Pa. 81.
The doctrine that the judgment of McCandless v. Gregg was properly admitted as prima facie evidence is supported by Kramph’s Ex’r v. Hatz, 52 Pa. 529; Masser v. Strickland, 17 S. & R. 354; 13 Wheat. 515; Lothrop v. Blake, 3 Pa. 493; Marsh v. Pier, 4 Rawle, 273.
Nov. 5, 1888.

Opinion:
Sterrett, J.,
The transactions ont of which this contention has arisen are somewhat involved; bnt, by reference to the pleadings, affidavits of claim and defense, and exhibits connected therewith, the main allegations of fact appear to be substantially as follows : In May, 1877, David Gregg recovered a judgment, in an action of scire facias sur mortgage against Robert Allen, for $24,440. The defendant, Allen, alleging he had a valid defense to a considerable portion of the judgment, retained Messrs. McCandless and Eckley as his attorneys to procure an order opening the .judgment and letting him into a defense; and, to that end, he entered into the following agreement with them, viz: " The one-half of the amount that the mortgage in McCutcheon, for use, v. Robert Allen, and judgment thereon, is reduced, is to be paid to General Eckley and Charles McCandless for their services professionally in said case, and one hundred dollars to each of them."
A petition, alleging usury, payment on account of the mortgage debt, etc., was presented, and so proceeded in that an order opening the judgment and reducing the same to $19,086.67 was made. On appeal from that order, this court reversed the same, as to the reduction of the judgment, and awarded a procedendo: McCutcheon, to use, etc., v. Allen, 96 Pa. 319. When the case was reached for trial, January 19th, 1881, an agreement was signed by the parties, Gregg and Allen, settling on the following terms, viz: "Judgment to be taken on verdict of jury against defendant for $30,000 and costs, three thousand dollars of which is to be assigned to Charles McCandless, attorney for defendant. This to be in consideration of the waiver of defenses in this case by defendant. The land to be sold at sheriff's sale at March Term, 1881, or as soon as it can be done, and purchased by said Gregg. Under the above arrangement, David Gregg agrees to sell to the sons and sons-in-law of Robert Allen, etc." A verdict was accordingly rendered and judgment entered thereon for $30,000 and costs, three thousand of which was assigned to Charles McCandless "pursuant to settlement" above quoted.
After Gregg purchased the mortgaged premises at sheriff's sale, he sold a portion thereof to plaintiffs in error, sons of Robert Allen, the mortgagor; and, in consideration of Gregg's selling the same to them at a reduced price, they agreed to " assume all liability for the three thousand dollars . . . assigned on January 19th, 1881, to Charles McCandless, attorney of Robert Allen, . . . and forever keep said first party (Gregg) from in any way being made liable for the payment of the same."
A few days thereafter, Robert Allen, claiming that the three thousand had been assigned for his sole use and benefit, transferred the same to his three sons, plaintiffs in error. Charles McCandless, having in the meantime obtained from his colleague, General Eckley, an assignment of his interest in the agreement for fees, brought suit against David Gregg for part of the three thousand dollars assigned to him as aforesaid, and obtained judgment by default for $2,173.86. That judgment was satisfied on January 11th, 1887, and the contract of indemnity given by plaintiffs in error to Gregg was assigned to McCandless, who, on the following day, brought this suit thereon.
On the trial, the agreements, assignments, etc., above referred to, were given in evidence. It was claimed by McCandless, the use plaintiff, that the three thousand had been assigned to him to secure the fees to which he and his colleague were entitled under the agreement above quoted, and, inasmuch as Gregg had been compelled to pay the same, he had recourse against the Allens on their contract of indemnity. On the other hand, it was contended by defendants below that no reduction of the mortgage or judgment thereon against-their father had been secured; that the three thousand dollars did not represent a reduction pro tanto of the mortgage debt; that said sum was assigned to McCandless, not for the benefit of himself, or for the joint benefit of himself and Eckley, either in whole or in part, but for the sole use and benefit of their father, Robert Allen, who, for a good consideration, afterwards assigned the same to them. They accordingly offered, in connection with other evidence, to prove these several matters of fact, all of which are more fully set forth in the offers recited in the 19th to 23d specifications inclusive.
In passing on these specifications, we must assume that plaintiffs in error were prepared to prove the several allegations of fact recited therein, and also that the jury, from the evidence thus before them, might have found the same to he true. If so, those facts, in connection with others that might have been found from the evidence, would have warranted the conclusion that McCandless had no right to sue for and recover in his own right, or to the use of any one else, any part of the three thousand dollars. In rejecting the evidence, the learned judge of the common pleas appears to have assumed that the assignment of that sum to McCandless, as attorney for Robert Allen, was for the purpose of carrying out the original agreement in relation to fees, and that it was not competent for defendants below to prove, either that no reduction of the mortgage was secured, or that the assignment to McCandless had no connection with the agreement for fees, etc. That was a mistaken view of the subject. There is nothing in the papers themselves to warrant any such construction, or conclusion of law; and, hence, the proposed testimony should have been received, so that the jury might have had an opportunity of determining, from all the evidence before them, what the facts were.
In view of the fact that defendants below had agreed to indemnify Gregg against the payment of any'part of the three thousand dollars, they were entitled to notice of the suit brought against him by McCandless in Allegheny County. If they had been notified and had succeeded in proving the several matters of fact con tained in the offers under consideration, including the fact that the three thousand dollars was theirs by virtue of their father's assignment, it would have been a sufficient answer to plaintiff's claim in that ease. Not having had an opportunity of making the defense in that case, they have a right to set it up in this suit on their contract of indemnity, as fully as if Gregg were suing in his own right. We think, therefore, that the offers of evidence, embodied in the 19th to 23d specifications of error inclusive, should have been received, and, under proper instructions, submitted to the jury.
It follows also that the learned judge erred in charging, as complained of in the 5th specification, " that under the evidence and pleadings the plaintiff is entitled to a verdict for $1,250, with interest from January 11th, 1887."
The 6th specification is also sustained. The burden of proof was on the plaintiff, and, under the evidence that was admitted, it was not for the court to say as matter of law that the attorneys employed by Robert Allen had succeeded in effecting a reduction of the mortgage.
It is unnecessary to refer specially to other specifications involving substantially the same errors that have already been noticed. The construction of the papers given in evidence was undoubtedly for the court, but undue effect was given to them throughout the entire charge.
Judgment reversed and a venire facias de novo awarded.