Court Opinion

ID: 3867541
Source: CourtListenerOpinion
Date Created: 2016-07-06 09:01:32.555878+00
Date Added: 2024-06-11T13:50:13.462049
License: Public Domain

This is a motion for rehearing of the order settling the issues in this case, and also of the former orders allowing the respondent's plea.
The complainant claims that the court erred in allowing the respondent to file a second plea, and that this is contrary to practice. We have before referred to instances where courts of chancery have allowed pleas to be withdrawn and new ones filed, *Page 28 
or the plea to be amended. The bill in this case has been twice amended, and once at great length.
The case of McKewan v. Sanderson, L.R. 16 Eq. 316, cited by the complainant, merely decides that when a plea is overruled, a second plea cannot be put in without special leave See alsoJackson v. Ward, 18 W.R. 973.
It is further claimed that an amendment of the plea was allowed "without any motion from the respondent, or any hearing from either party."
February 9 and 10, 1874, a hearing was had upon the sufficiency of the original plea, and after the opinion of the court, delivered April 6th, Harris filed his motion for leave to amend, specifying the amendments, and an order was entered in Providence, June 29, 1874, allowing the respondent to amend the plea, and to file an answer to such parts of the amended bill as to which the respondent's demurrer had been overruled. This order, with the motion and amendments, was filed in Kent County, July 3. The plea, as amended, was set down by the complainant for hearing, and was heard upon its sufficiency before the full court, at Providence, June 12, on printed briefs and full oral arguments (present Messrs. Bradley  Tillinghast, c.). Neither the printed brief nor the minutes of the court contain any intimation that the complainant's counsel objected to the amendments as improperly made; and after the opinion of the court, July 17, 1875, an order was entered July 26, sustaining the plea as amended, and the complainant filed his replication the same day.
It is claimed that the plea was incomplete, because it does not allege in the language of some of the precedents that the accounts had been examined and approved by the complainant.
It is not necessary, in order to give to the accounts the weight and quality of stated accounts, that they should have been examined and approved; where they have been, it is of course proper so to plead There are many circumstances to be considered, such as length of time, acquiescence, and the fact that the party has acted upon them to his injury. See cases formerly cited, and 4 Robinson's Practice, 569.
And besides it makes some odds which side renders the accounts. In this case it is Greene who seeks to reopen and surcharge *Page 29 
the accounts. The accounts were rendered by, and not to him.
It is claimed, that however the precedents may be, our rules (Equity Rule 35) do not allow of amending a plea.
While the rule does not provide for amending a plea as a matter of right, it would be contrary to all the principles of equity practice to consider it as preventing the court from allowing an amendment in cases where the justice of the case requires it, and it may be presumed the court would not allow it in any other case.
Says Mr. Chief Justice Taney, in Rhode Island v.Massachusetts, 14 Pet. 210, 257, "The Court of Chancery has always exercised an equitable discretion as to its rules of pleading, whenever it has been necessary to do so for the purposes of justice."
The 49th New York Chancery Rule provided, that if a plea be overruled no other plea should be received. But it was laid down that this did not prevent the court from allowing another plea on special grounds. 1 Hoffman Chancery Practice, 226. So, also, in the English Chancery. Rowley v. Eccles, 1 Sim.  Stu. 511.
In In re Lyons, 1 Dr.  Wal. 327, 333, Lord Chancellor Plunkett said: "Rules ought to be enforced against a party who undertakes to act in opposition to them without an application to the court in the first instance. Yet there is no ground for saying, nor can it be pretended that these rules, the creatures of the court, are to become its masters, by assuming a nature so binding as to overrule and control the acts of that very court which gave them existence."
And in Dicas v. Lord Brougham, 6 C.  P. 249, which was a suit against Lord Brougham in consequence of an order made by him in a case in chancery, Lord Lyndhurst, C.B., said that the Chancellor had the authority to make an order in a particular case altering the practice.
So, also, in Burrell v. Nicholson, 6 Sim. 212, Shadwell, Vice-Chancellor, said: "The orders of the court are to be considered as laying down general rules, but not as being so imperative that they can under no circumstances be departed from;" and also Lord Chancellor Cottenham, in Smith v.Webster, 3 Myl.  C. 244. And the ordinances of Lord Bacon, A.D. 1618 (No. 44), *Page 30 
evidently contemplate the making of an order upon the special nature of the case against the general rules whenever necessary.
It is also argued that as the court has held that all the answers make one answer, they do make a full and complete answer, and make the identical defence made by the plea, and so overrule the plea.
The rule, that the answer overrules the plea, applies only where the respondent answers to something which, by his plea, he says he ought not to be obliged to answer.
In the present case the plea is to relief only, and after the respondent had answered fully, including in his answer the defence of stated accounts as if pleaded, the complainant filed a very long amendment to his bill, and thereupon the respondent was, by an order of court, allowed to plead as to a new bill. He did so.
The rule that the former answer cannot be withdrawn, but will all be considered together as one answer, is a rule made in the interest of justice to protect the complainant, and to preserve for his use the evidence of any statements or admissions which the respondent may at any time have made.
If the amendments were immaterial, they should not have been made. If material, the order allowing the respondent to plead anew was a proper one.
Counsel again contend that to a bill to set aside an account, the account itself cannot be pleaded.
It might be sufficient to refer to the authority of Story's Eq. Pl. Redfield's ed. § 802.
The case cited by the complainant from Freeman Ch. c. 62, is qualified and explained by Beames, Elements of Pleas, c., 231. It is said in Freeman, if the bill "setteth forth that there was an account and that there was a mistake, and setteth forth the particular mistake, there an account stated is no good plea." In one sense this is true, but it is calculated to mislead. Such a plea purely, and with nothing more, would not meet the case. It must, also, answer the allegation of mistake. But if it means, that stated accounts with proper averments do not make a good plea in such a case, then it is not now law.
Gilbert (Forum Romanum, 56) says: "The third peremptory plea is the stated account; and if fraud be objected to such an account and to the stating of it, and all the circumstances of *Page 31 
fraud be answered and denied, such stated account may be pleaded, for that is not an `exceptio ejusdem rei,'" c.; and Beames, 236: "A plea of stated account is good, although the bill charges fraud or error as ground for opening it." We have referred to these as authorities, although we consider the principle as sound independently of them.
The cases of Knight v. Bampfield et als. 1 Vern. 179, andWillis v. Jernegan, 2 Atk. 251, are in point as showing the practice. Stated accounts there pleaded were not objected to. And the language of Mitford, *259, is in substance of the same purport. The principle, that to a bill to impeach a stated account the account may, with proper denials, be pleaded, is stated by Lord Hardwicke in Hankey v. Simpson, 3 Atk. 303, and is recognized by Chancellor Walworth in Weed v. Smull etals. 7 Paige, 573, 575, although it was not the point in the case. A very good reason why the point has not been decided is, because it is so consistent with the principles on which all anomalous pleas are founded that no one has ever presumed to dispute it.
The reference to De Montmorency v. Devereux, 1 Dr.  Wal. 119, in the opinion delivered March 31, 1876, was a mistake, there being in that case an answer and no plea.
But it is further claimed by the counsel for the complainant that such a plea does not apply to a case like the present where the accounts are set up, not as a bar to discovery and relief, but as a part of the transaction itself sought to be impeached. And Dr. Langdell's new work on Equity Pleading is quoted as thus stating the case of Roche v. Morgell, 2 Sch.  Lef. 721: "The primary object of the bill [in that case] was to set aside certain conveyances of property to the respondent, as having been obtained by fraud, and the release pleaded appeared on its face to have been a part of the transactions charged to be fraudulent. If the conveyances were voidable for fraud, therefore, the release as pleaded did not render them valid; and it seems that the plea was bad as being exceptio ejusdem rei cujus petiturdissolutio."1
This often cited case was a bill for discovery and relief charging fraud in certain accounts delivered, and to set aside a certain conveyance as fraudulent, and that it might be decreed to stand as security only. The respondent pleaded to the discovery and *Page 32 
relief a subsequent statement and settlement of accounts between the parties, and a release voluntarily and freely, and without undue practice, executed by the complainant. The bill had not stated the release and prayed to set aside that also. Lord Redesdale held that the plea of release could be no bar to discovery, for upon that very discovery would depend its validity; but if it had been pleaded to the relief only, it might have been with proper averments a good plea, if supported by an answer. 2 Sch.  Lef. 726, 727.
This statement of the case shows how much weight is due to the claim that it establishes the general principle contended for; certainly not a very intelligible one.
We come now to two points which the counsel for the complainant have argued with a great deal of zeal and ability, not only at this but at the former hearing
The first is, that the plea and the issues as settled do not present to the jury the question of trust and confidence, which is considered by the complainant as of great importance to his side of the case.
As we have before observed, there is here no relation of attorney, agent, trustee, c., no relation implying a duty where the party would be prevented from dealing with the property at all, or if he did, the burden would be on him to show that all was entirely honest and free from suspicion.
Suppose the issue made and found for the complainant. It would not enable the court to set aside a verdict found for the respondent upon the contract as claimed by the respondent, nor would it necessarily be inconsistent with it.
Having before stated our view of its admissibility and effect as evidence, it is not necessary to repeat it.
Another point argued relates to the allegation of promises of mutual benefit from the business. We give what we believe to be the substance of these allegations.
And the subsequent reductions, while alleged to have been made by Harris for the reason that he could not otherwise make any profit, are alleged to have been made subject to the same understanding and agreement.
The bill alleges certain relations between Greene in printing, and Harris in selling goods, commencing in 1841, sometimes on *Page 33 
joint account, and sometimes at fixed prices; that (Amendment A) in April, 1854, new arrangements were made, Harris to sell, and Greene to print, for prices fixed by Harris, and subject to the condition that if either was making a loss and became dissatisfied, he should be entitled to a revision of the prices or subsequent allowances and corrections, so as to give him a fair share of the profits of the whole business. And in December, 1854, Harris wrote to Greene the letter quoted in the brief: "If I make money you will also," said Harris (Amendment C). Harris proposed to guarantee to G. a certain rent for the mills, if his profits on the prices as fixed did not amount to such rent. These guaranties continued until April 1, 1857, after which Greene continued to make, and Harris to sell, without any guaranty or allowance, until January, 1859, when Harris agreed that the prices thereafter allowed should be one eighth of a cent. per yard over the price and compensation paid by Slaters to Saunders, "subject furthermore to the general arrangement and understanding hereinbefore set forth in relation to their mode of doing business together."
So far as this can be considered as a claim for partnership or joint profits, we have heretofore expressed our opinion fully upon it; and so far as it can be considered as alleging a promise that the contract should be beneficial to the complainant, we consider it too indefinite to form the subject of an issue, even if it was not liable to the objection that no such issue is made by the plea.
The replication should have been withdrawn, or leave asked to do it, before or at the time of filing the present motion. But the opinion we have given renders any further discussion of this point unnecessary. Mitford's Eq. Plead., by Tyler, Appendix, 435;Hughes v. Blake, 6 Wheat. 453, 472, 473; Rhode Island v.Massachusetts, 14 Pet. 210.
Motion denied.
After the foregoing opinion was delivered the complainant called the attention of the court to the fact that the amended plea was filed before the last answer of the respondent Harris was filed, the dates being respectively July 2, 1874, and July 11, 1874, and claimed that the answer, being subsequent to the *Page 34 
plea, overruled it. Thereupon the court gave the following opinion: —
1 Langdell, Summary Eq. Pl. § 111, p. 73.