Court Opinion

ID: 3578890
Source: CourtListenerOpinion
Date Created: 2016-07-05 23:30:25.356431+00
Date Added: 2024-06-11T07:41:16.784265
License: Public Domain

The undertakings of the respective parties to the contract were dependent, and the acts they were bound to perform were concurrent and reciprocal. (Bank of Columbia v. Hagner, 1 Peters, 455; Dana v. King, 2 Pick., 156; Johnson v.Wygant, 11 W.R., 48.) The plaintiffs could not call upon the defendant to deliver the stock except upon payment of the agreed price, neither could *Page 835 
the defendant claim the money except upon a transfer and delivery of the stock. The acts of the parties in the performance of the contract were to be simultaneous, the agreement not contemplating a credit to either. Neither could put the other in default, except by performance or a tender of performance on his part, and a recovery cannot be had for non-performance of the contract, unless an actual performance or tender of performance is averred and proved by the party alleging a breach by the other. (Cases cited above; Lester v. Jewett, 1 Ker., 453; Jones v.Marsh, 22 Vermont, 144.) It was not claimed that there was actual payment, or any tender of money. The only offer was of the checks of the plaintiffs. The check for the 1,000 shares named in the contract at the agreed price was for $134,421.33, and the other check offered was for $56,232, amounting in the aggregate to $190,654.33. It was admitted on the trial that, on the 19th day of December, the plaintiffs had not in any bank or banks money standing to their credit sufficient to meet the checks they had drawn, and that, on the 31st of December, they had not funds in any bank or banks standing to their credit to meet the checks offered to the defendant, and that they had not, on either of the days named, a sum exceeding $50,000 standing to their credit in any bank or banks in the city. Aside from every question of tender, the plaintiffs were not ready or in a condition to perform the contract on their part. These checks did not represent, and were not drawn against moneys on deposit. The smallest of the checks was not good as representing funds against which it was drawn. All the cases agree that a readiness, as well as an offer, to perform, must be shown by the party seeking to put the other in default.
The readiness to perform a contract calling for the payment of money, recognized by law, is the actual possession of or control of the money, as owner or with the right of disposal for that particular purpose. (Hammond v. Gilmore, 14 Conn., 479.) Ability and readiness to pay was a fact material to be proved by the plaintiff upon the trial. SPENCER, J., in Porter *Page 836 
v. Rose (12 J.R., 209), says: "Where two acts are to be done at the same time, as where one agrees to sell and deliver, and the other agrees to receive and pay, an averment by the purchaser, in case he sues for the non-delivery, of a readiness and willingness to pay is indispensably necessary; and consequently the readiness and willingness to pay is matter to be proved on his part, whether the other party was at the place, ready to deliver the thing contracted for, or not." The case cited was disposed of upon the application of this doctrine.
To the same effect is Topping v. Root (5 Cow., 404), and the principle has never been questioned. (See Bronson v.Wiman, 4 Seld., 182; Lester v. Jewett, supra.) There was no evidence that the checks would have been paid. There was no proof, or offer to prove such fact; neither was there any request to the referee to find that the checks were the equivalent of money, or would have been paid on presentation. It will not be assumed that checks drawn without funds to meet them will be paid. On the contrary, the presumption is in accordance with the law that, as checks available for obtaining money, they are worthless, whatever their value as the obligations of responsible persons may be. The bank was under no obligation to honor them, and the presumption is they would have been dishonored. But it is enough that there was not, at the time of the offer, a readiness and an actual ability to take and pay for the stock shown. This is essential, aside from every question as to the form and efficiency of the tender. The plaintiffs did not have the money during either of the days referred to.
The plaintiffs recognized the necessity of proving a readiness and ability to pay by the evidence they gave in respect to the certification of the checks. The evidence is not satisfactory for the purpose for which it was given, as it comes far short of proving that, on the 31st of December, the bank would, without funds, have come under an obligation for near $200,000, and there was an entire absence of evidence that any officer of the bank had authority to certify checks as good when the drawer was not in funds. There was not even evidence *Page 837 
that, in the course of business in that bank, the president was in the practice of certifying checks, or transacting other business usually performed by cashiers, or that circumstances existed which would have estopped the bank from denying the authority of the president, and repudiating the certificate, so as to make the check valid as an obligation of the bank in the hands of the defendant. An authority to pay a check without funds of the drawer, or to certify it as good when there are no funds to meet it, will not be presumed, and a certification under such circumstances only binds the bank by way of estoppel, and to prevent a fraud upon innocent holders. It is not intended to impute fraud or a fraudulent intent to the plaintiffs in procuring these checks to be certified although without funds at the time to meet them, as they might have been reasonably certain of being able to make provision for their payment before, in the course of business and transmission through other banks, they could be presented; but the confident expectation or reasonable certainty of an ability to provide in the future, is not the equivalent of a present readiness and ability to pay. A certification of a check, without funds on deposit, is irregular, and it may be questionable whether a party might not properly refuse to receive a check thus certified, upon the principle ofReed v. Bank of Newburgh (6 Paige, 337). But a certified check is not money, or if funds are not on deposit to meet it, the representative or equivalent of money. It is but an obligation of the bank to pay, or rather to make good its representation. If the defendant should consent to receive it in payment, he might do so, but he was not bound to receive it, and, therefore, the ability to procure, or even the possession of a certified check, it being admitted that the drawer had no funds, or not sufficient funds to meet it, would not be evidence of the plaintiff's ability to pay the money. On the contrary, it would be evidence of his inability; and a possession of the check, thus certified, would simply be evidence of the ability of the plaintiffs to induce the bank to become security for the payment of the debt, for this is the legal effect of the transaction. *Page 838 
Again, as before suggested, a certification of a check is only an admission of a fact, to wit, that the drawer is in funds, applicable to its payment, and, if untrue, may be contradicted, and binds no one except in favor of one who has acted and parted with value on the faith of it. Had the defendant received the check with knowledge of the truth, the certificate would have added nothing to the value of the check, and a paper that only has value from a concealment of the truth is valueless, and for all purposes the checks, certified or uncertified, should be treated according to the value they intrinsically had, under the circumstances as they actually existed, assuming as we must, that no fictitious value would be given to them by withholding the truth. The defendant's ability to enforce a check, certified without funds, against the bank, would depend upon the evidence of his knowledge, and it is but equity that he should have the benefit of the truth in resisting any claim founded upon an untruth. If it be conceded that he made no objection to receive a check, and waived the right to demand lawful money, yet he did not, by such act, waive the right to demand a check good as drawn against an actual deposit. A party giving a check, in effect, represents that he has money on deposit to meet it. He did not receive it; and when the plaintiffs sue for a breach of the contract, this assent to the form of payment, by check, does not dispense with proof that the check was good, and that the plaintiffs were then able and ready to pay the money, either upon the check or the original contract. But the evidence of ability to pay, even by a check certified by the officers of the bank, is insufficient and unsatisfactory. The fact was not proven so conclusively that it was error not to find the fact. The evidence was slight, but perhaps sufficient to raise a question of fact for the jury or other tribunal having the trial of issues of fact. It is true, one of the plaintiffs and one of the clerks say the checks would have been certified on the 31st of December, but, so far as the case discloses, this is based entirely on an interview between the same plaintiff and the president *Page 839 
of the Tenth National Bank, on the 18th of December, when it was expected the transaction might be concluded the next day. The evidence is that, on being told by this plaintiff that he should probably want to draw these amounts the day following, and that it would be an unusual overdraft, the president told him he would certify the checks. He never applied before to the president to certify checks, and there is no evidence that the president ever certified a check for any person. This promise, if authorized, bound no one, and the plaintiffs gave no evidence that the president remained of the same mind on the 31st of December, nearly two weeks thereafter, and the checks never have been certified. A jury, or the referee, might well have found that the allegation, that the checks would have been certified, was not proven. The plaintiffs did not prove that they were able and willing to take and pay for the stock on the 31st of December, and for that reason the complaint should have been dismissed. But, secondly, there was no sufficient tender and offer of performance to put the defendant in default. It is agreed that the plaintiffs were in no condition to demand, and had no legal right to claim the additional stock, created and issued under the action of the directors of the railroad corporation in April, 1867. Leaving out of view the dividend on the shares which the plaintiffs claim, under their contract, they were entitled to the delivery of 1,000 shares of the stock of the Hudson River Railroad Company, on the payment of $134,421.33, and this was the extent of their legal right. In considering the sufficiency of the tender, it should be remembered that the parties were dealing at arms' length, neither making concessions or waiving any claim, but each standing on their strict legal rights. The plaintiff, Martin, says he did not think the defendant would accept the checks; and the formal manner in which the plaintiffs approached and communicated with the defendant, together with the wary and cautious bearing of the latter on each occasion, making no answer to any claim made upon him further than that he did not understand the effect of the propositions, and would see, *Page 840 
or that he would see his lawyer, in connection with the fact that the contract, as interpreted and insisted upon by the plaintiffs, if performed, would involve the defendant in a heavy loss, negative all idea that the defendant intended to waive any, the most strict and technical, legal right, or that the plaintiffs understood him as waiving or conceding anything. The general rule is, that, to make a legal tender, there must either be an actual offer of the money produced, or the production of the money must be dispensed with by the express declaration or an equivalent act of the creditor. (Thomas v. Evans, 10 East, 101; Bakeman v.Pooler, 15 Wend., 637.) If anything but money is offered, the tender will not be effectual for any purpose, unless the creditor in terms, or by clear implication by some act equivalent to an express declaration, waives all objections to the quality or character of the tender. Perhaps an objection to receive the tender upon another distinct and specific ground would be regarded as evidence of a waiver of an objection to the quality of the tender; upon two grounds: 1. The statement of one objection may be regarded as evidence of an intent to waive all others, on the principle of expressio unius est exclusioalterius. 2. A statement of one objection which cannot be obviated, and a silence as to an objection which can be obviated, will operate to mislead the debtor, unless the creditor is held to the objection taken. By taking one objection, he induces the debtor to act upon the belief that there are no others, or that all others which could be taken are waived. (Carman v. Pultz,21 N.Y., 547; Haskell v. Brewer, 2 Fairf., 258.)
The cases in which the creditor has been held to have waived, by implication, the objection to the quality of the tender, and dispensed with a tender of money, are those in which the debtor has refused to receive the tender on the express ground that the amount was insufficient. (Polglass v. Oliver, 2 Cr.  Jr., 15; and cases cited in note to Am. ed.) The mere passive refusal to receive a tender, or rejection of it without assigning a reason waives nothing, and leaves the party to *Page 841 
justify his refusal upon any ground recognized by the law. InDunham v. Jackson (6 W.R., 22), in the Court for the Correction of Errors, the rules relating to a tender upon money contracts were carefully considered, and Judge MARCY, in the only opinion delivered, and which was concurred in by the whole court, protests against any relaxation of the rules upon that subject which will render it a matter of uncertainty what shall constitute a tender. He says, in such an event, "nothing will have been gained." "Rigid rules are, upon the whole, better than uncertain ones," and cites, with approval, Thomas v. Evans
(10 East, 101), and Kraus v. Arnold (7 J.B. Moore, 59).
Dunham v. Jackson was a bill to redeem stock from a pledgee, and the parties had come together for the purpose of redeeming. A broker attended to receive a reassignment of the stock and pay what should be found due the pledgee, and, after the amount was agreed upon, being requested by the agent of the pledgee to draw his check for the amount, took out of his pocket-book a blank check for the purpose of filling it up, but was interrupted by the pledgee observing "let it be done to-morrow," and demanding a larger sum than the amount liquidated; and it was held that these circumstances did not amount to a tender, and that the bare refusal to receive the sum due and the demand of a larger sum, were not enough to excuse the actual tender of the money. Chancellor KENT's decree, holding the tender and offer insufficient, was unanimously affirmed. InThomas v. Evans (supra), the defendant had left £ 10 with his clerk for the plaintiff, of which the clerk informed the plaintiff when he called and demanded a larger sum, and the plaintiff said he would not receive the £ 10 or anything less than his whole demand; and it was held that this did not dispense with the actual production and offer of the money. In Kraus v.Arnold (supra), the agent of the debtor offered to pay to the clerk of the debtor's attorney £ 7 12s., saying that one Tenson had the money for that purpose, but the clerk demanded £ 8. Tenson was present, and put his hand in his pocket to take out his *Page 842 
pocket-book to pay the £ 7 12s., but the agent of the defendant desired him not to do so, as £ 8 were demanded. The court held there had been no legal tender, and that the money should have been produced, "when, perhaps, the clerk might have been tempted to take it." Within the cases cited there was no legal tender or offer to perform the contract by the plaintiffs. There was no production or offer of money, and there was no act or declaration of the defendant dispensing with its production, and consenting that the checks tendered should for any purpose be regarded as money. He did not waive the objection to the quality of the tender. Very possibly, had bank notes, which are a part of the currency of the country and pass as money, been offered, and not specially objected to, the tender might have been sufficient in that respect; but it is not necessary to consider that question, as no money was present or offered, and the cases recognize a broad distinction between bank notes of the character mentioned, and bills of exchange, checks and other instruments, which are mere securities or documents for debts. (Miller v. Race, 1 Bur., 457; Bank of the U.S. v. Bank of Georgia, 10 Wheat., 333, per STORY, J.; Wright v. Reed, 3 T.R., 554; Snow v.Perry, 9 Pick., 539.) The plaintiffs did not in any form offer or propose to pay the money. On the contrary, they limited their offer to the checks, only proposing, and that equivocally, in case the checks were objected to, to get them certified. By thus restricting their proposal, they indicated very clearly not only the extent of their ability, but the limit of their intentions, and their action was equivalent to an express declaration that they would do nothing more than deliver the checks. It would seem that the proposition was to get the checks certified after the delivery of the stock. The clerk swears that he told defendant that he would get the checks certified if he required it; that defendant made no reply, and he added, "if he would transfer the stock." The defendant was not required to state his objections to the proposal, and he did not. He avoided a direct answer and left the plaintiffs, without saying or doing anything to mislead them, to *Page 843 
take such action as the law prescribed, if they desired to lay the foundation of an action by putting him in default. (Bakeman
v. Pooler, supra.) The defendant did not give the stock for the checks; he did not refuse to perform the contract or to do any act, save only to exchange the stock for the checks. Nonconstat, that, upon the production and offer of the money, he would have transferred and delivered the 1,000 shares agreed to be sold. He did not say he would not. There is still another objection to the tender, fatal to it as the foundation of an action against the defendant. The offer to receive and pay the agreed price for the 1,000 shares was not an unqualified, unconditional offer.
The remarks of Judge COWEN, in Wood v. Hitchcock (20 W.R., 47), are appropriate to this case. He says: "The books are sufficiently nice as to the manner of a tender, but I think the case at bar shows that they are not so without reason. The person making the tender may avoid all implication against the idea of a qualification, or other circumstance destroying his tender, by making it in writing, and even negativing that it is on any condition or reserve, or intended to prejudice the plaintiff's further claim." If the acts of the person making the tender are ambiguous or of doubtful import it is his fault, and they are to be construed most strongly against himself. It is well settled by authority that a tender must be unconditional; that no condition must be annexed to it which the creditor can have any good reason for objecting to. There must not be anything raising the implication that the party making the tender intends to demand, as a condition of the tender, anything to which he is not entitled. (Wood v. Hitchcock, supra; Brooklyn Bank v. DeGrauw, 23 W.R., 342.) He may not require as a condition a receipt or an indorsement of the payment upon an obligation. (Eddy v. O'Hara, 14 W.R., 221; Thayer v. Brackett,12 Mass., 450; Loring v. Cooke, 3 Pick., 48; Richardson v.Boston Chemical Laboratory, 9 Met., 42.)
The referee has found as a fact, that there was no offer by the plaintiffs to take and pay for the 1,000 shares, distinct *Page 844 
and independent of a demand for another 1,000 shares and for two dividends on 2,000 shares; in other words, that the offer was conditional and connected with a demand, to which the defendant had a right to object. If there was any evidence in support of this finding, it is conclusive in this court, and cannot be reviewed. Whenever there is ambiguity or question as to the intent of the party making a tender, growing out of his acts and declarations and the circumstances attending the transaction, the question whether the tender is conditional or unconditional is one of fact for the jury, and not of law for the court. Where the debtor's agent told the creditor he had called to tender £ 8 in settlement of his account, and the creditor answered that he would take nothing less than the bill for £ 19, which the debtor's agent produced at the time, it was held that it was a question for the jury whether the tender was conditional or unconditional. Lord DENMAN, Ch. J., said "there was enough of ambiguity to make the matter fit for a jury;" and to the same effect is Marsden
v. Goode (2 C.  K., 133), in which the question was whether a check was tendered in full payment of all claims and unconditionally. Here was enough of ambiguity to carry the case to a jury, and in such case the finding of the referee concludes this court. The evidence not only supports the views of the referee, but a report that the tender and offer were unconditional would have been against evidence. The interview of the 19th of December may be referred to as throwing light upon and aiding in the right understanding of the transaction of the 31st December. It is true that no tender of performance was then made by either party, so as to put the other party in default. (Dunham v. Jackson, supra; Leatherdale v. Sweepstone, 3 C. P., 342.) But the acts of the plaintiffs indicate very clearly their views of their rights under the contract, and the purpose and object of their subsequent offer. Upon that occasion, when the defendant offered to transfer the 1,000 shares on receipt of the agreed price, he consented, on the suggestion of the plaintiffs, to take off the cash dividends, *Page 845 
if the plaintiffs would indorse his certificates in the trust company, which would have enabled him to withdraw his deposits. This would have closed the contract, giving the plaintiffs all they claimed in respect to the original shares contended for. This they virtually declined, and immediately delivered to the defendant the two papers making distinct demands, one for the original 1,000 shares and the cash dividends thereon, and the other for 1,000 shares additional stock. They were handed simultaneously, and as demands then due upon a single contract. The one only claimed as incidental to and dependent upon their right to the other, and having no foundation except upon the obligation to transfer the original shares. The demand was necessarily single, and in whatever form presented, its nature was not changed. The obligation of the defendant to transfer stock, whatever its extent, was a single obligation, not capable of being severed by the act of the plaintiffs, and they did not undertake to sever it. The fact that separate checks were proposed, and were subsequently offered for the two amounts, did not vary the effect of the transaction, as a single offer, and a single demand upon the defendant to fulfill his obligation as interpreted by the plaintiffs. The transaction of the 31st of December was in harmony with this view. On that day the two checks were offered at the same time, as a performance of the one contract by the plaintiffs, and one letter was handed to the defendant as the demand, the condition upon, and purpose for which the checks were offered. In that note the plaintiffs say: "We are ready to do what we offered and tendered in our notices and renew our notices." They renew them in a single breath and the offer was of the two sums together, and the demand upon the defendant was single, although of two distinct thousand shares, and as if in words the plaintiffs had said to the defendant, "we offer you two checks, one for $134,421.33, and the other for $56,232, the one being the contract price for 1,000 shares of Hudson River railroad stock, and the other the cost, and interest on the cost, of an additional 1,000 shares, to which *Page 846 
we are entitled under our contract, and in payment for these 2,000 shares, and which we now require you to deliver to us under your contract." It is very certain that the plaintiffs did not indicate that the defendant was at liberty to accept one check, and transfer one part of the stock demanded, and refuse the other, and such was not the legal effect of the offer. Had the plaintiffs transmitted the checks by mail, with the letter of 31st of December, the defendant would have been bound to accept both, and perform the entire demand; accept the proposition as made, or reject it. He could not legally have separated it, and acceded to one part of the proposition and retained one of the checks, and repudiated the residue. The plaintiffs might well have said, "we made you no such offer as you have assumed to accept." Upon the evidence the tender was conditional and therefore void.
For these reasons, as well as those assigned by Judge FOLGER, I am for an affirmance of the judgment, with costs.
CHURCH, Ch. J., GROVER, ANDREWS and PECKHAM, JJ., concur with RAPALLO, J. ALLEN and FOLGER, JJ., for affirmance.
Judgment reversed and new trial granted, unless the defendant consents to a judgment against him for $1,453.67.