Court Opinion

ID: 8175087
Source: CourtListenerOpinion
Date Created: 2022-09-09 22:20:09.713068+00
Date Added: 2024-06-11T16:39:54.631175
License: Public Domain

DeNT, Judge,

(dissenting):

From the conclusion in this ease I dissent.
The bill in effect alleges that the plaintiffs at the instance of the defendant bant entered into a contract to compromise an alleged defalcation on the part of the plaintiffs’ principal to such bank, that the defendant agreed that if the plaintiffs would pay it six thousand dollars as a settlement, it would deliver up for cancellation the bond signed by the plaintiffs as sureties for the defaulting cashier and would not have any litigation over the matter, that plaintiffs strictly complied with their part of the agreement, but the defendants refused to carry it out, but in fraud thereof instituted proceedings at law against the plaintiffs, and they ask that their contract be specifically performed. In short, their allegation is that the proceedings at law are in furtherance of the fraud perpetrated on plaintiffs by withholding from plaintiffs the bond stipulated after plaintiffs had fully complied with their part of the compromise. This gives plaintiffs undoubted right to appeal to equity as the remedy at law is wholly inadequate. First, they bought their peace at law and *602are entitled to it according to the pleadings and proofs. Second, they had the right to appeal to the consciences of the defendant’s officers, as they are powerless to prove such officers’ agency to make the compromise otherwise than through themselves which places plaintiffs at a great disadvantage on the trial in a court of law, even at the mercy of the defendants. Third, the possession of the bond at law is presumptive evidence of the right to it, which must be overcome by proof, while in equity no such presumption arises; on the contrary equity regards that done which should have been done, and decrees cancellation accordingly. Fraudulent retention is equivalent to fraudulent procuration. Fourth, plaintiffs are compelled to endure the har-rassment, the prolongation and the uncertain vicissitudes of a law suit, while the defendants enjoy the full benefit of the fraud perpetrated by them in securing a compromise and breaking it, and have within their power the evidence on which plaintiffs’ right of recovery depends. Fifth, it is neither equitable, just nor right to send plaintiffs to a court of law and thus aid the defendants in the perpetration of their fraud and throw on plaintiffs the great burden of proving the plea of covenants performed or accord and satisfaction, when the proof thereof is wholly in the breast of the defendants here, who are not parties to the law suit, and yet the real persons interested therein, and whom plaintiffs cannot make witnesses except by placing themselves at their mercy. In chancery the corporate name represents the consciences of the corporate officers while at law it is a legal entity without soul or conscience. In Story’s Equity Jurisprudence, s. 738, it is said: “Courts of equity ought not to decline the jurisdiction for a specific performance of contracts whenever the remedy at law is doubtful in its nature, extent, operation or adequacy.” “Equity will restrain the enforcement of a legal claim where promises have been made to the person legally liable not to enforce it on the faith of which obligations have been entered into.” Hilliard on Inj., s. 59, 383. Compromises are favored and will be enforced in equity, also contracts for the delivery, execution, assignment or cancellation of promissory notes and for the transfer of debts and claims may be enforced specifically. 22 Am. & En. En. Law 995, 1000; Phillips v. Berger, 8 Barb. (N. Y.) 527; Gottschalk v. Stein, 69 Md. 51; Shockly v. Davis, 17 Ga. 177; Tuttle v. Moore, 16 Minn. 123; Story’s Equity Jurisprudence, Vol. 3, ss. 694, 700. This is not *603a case where there is a mere defense of a written instrument involved, but is a case where the defendants are engaged in doing the very thing expressly, stipulated for a valuable consideration that they would not do, and the suit brought by them in the name of the bank is in violation and fraud of their express agreement not to bring it after they have received valuable consideration for not doing so, and is therefore not subject to the doctrine of concurrent jurisdiction. The question is not as to which court has the prior jurisdiction, but whether equity has jurisdiction to prevent the defendants from doing what they bargained not to do to the harrassment and injury of the plaintiffs. The court should have either cancelled the contract or enforced it. '■ By dismissing the suit the court cancels and annuls that portion of the contract wherein it was agreed that there should be no litigation between the parties, and throws it wide open for litigation, although it permits the defendants to retain the full price paid by the plaintiffs to secure their peace. Not only so, but it deprives plaintiffs of the right to appeal to the consciences of the defendants interested in but not parties to the law suit and places plaintiffs at their mercy in so far as their evidence may be needful to establish the compromise or the terms thereof and power to make it. TJnder this holding in all cases of concurrent jurisdiction fraud by increasing fraud may select its own tribunal and thereby oust the jurisdiction of equity.
Such determination may be the law of'this ease, but it is contrary to equity and good conscience.
The jury trial argument should receive but little weight as an issue out of chancery may be easily had in all proper cases, and the rules of equity as a court of conscience should be made correspondingly plastic, that justice may prevail over the technical formalities of judicial procedure. Section 4, chapter 131, Code; McGregor v. Camden, 41 W. Va. 200; Davis v. Alexander, 42 W. Va. 465. The whole frame and contents of the bill verified by affidavit show that it is an appeal to the consciences of the defendants as to facts peculiarly within their knowledge and without which plaintiffs are powerless to sustain their defense in a court of law and which are necessary to substantiate the fraud practiced upon them in securing their money, withholding the bond and bringing suit thereon in violation of express representations and stipulations to the contrary. When the .defense is *604materially dependent on the evidence of the real plaintiffs;, because the unbending rules of law can afford no relief, equity steps in. Discovery, disadvantage at law, deprivation of evidence, deceit practiced, and default of legal remedy, all call for equitable interference. 2 Story’s Equity Jur., ss. 690, 695, 699, 700, 705, 716, 877, 882. The equity of this case is too plain for further comment. It is not though an infringement of the ordinary policy of the times to surrender the uneducated farmer to the protecting care of the educated banker. The Law demands it, Equity sanctions it, and blind justice weeps and pleads in vain. For
“There is no power in Venice,”
“Can alter a decree established.”
“’Twill be recorded for a precedent.”
“And many an error^ by the same example,”
“Will rush into the state.”