424
COMPROMISE. SEPARATE MAINTENANCE.
proves to be false and mistaken, which
had been assumed to be or agreed
upon as certain, and the contract, con-
sequently, fails in an essential parti-
cular. Yet the limits of the risk, and
the line which separates the uncertain
from the certain, depend in every
such instance on the terms of the con-
tract, and the intention of those by
whom it is executed, and there is no
reason to doubt that a promise to in-
demnify against any loss which a ship
might sustain in a particular voyage,
in consideration of a promise to pay a
sum certain whether she actually
sailed or not, would be binding in
principle, however exceptional or un-
usual, unless invalidated by its ten-
dency to divert the contract of in-
surance from its legitimate purposes,
to those of a game of chance. This
distinction is more or less applicable
to all contracts which operate as a
wager, and have doubt for their basis,
or into which it enters as a ma-
terial ingredient; and there may be
cases in which a compromise is,
like most insurances, based on the
supposition that particular facts are
certain, and that the uncertainty is
limited to others, and may conse-
quently be avoided By proof that the
parties were acting under an errone-
ous or mistaken belief or impression.
Niubours v. Cocke, 24 Mississippi, 44.
Or to state the principle somewhat
differently, while the existence of a
doubt will go a great way to sustain
any agreement to which it mav give
rise, and which is intended for its solu-
tion, the case is widely different when
a contract is based upon a supposition
of right which ultimately turns out to
have no foundation ; ante, 397. Thus,
if the parties who submitted their
case to the decision of the school-
master, acted upon the belief that his
opinion had put an end to all doubt
about the right, and merely meant to
make provision for the delay or ex-
pense which might attend upon its
assertion, they might justly claim to
be relieved subsequently, from the con-
sequences of a mistake which lay be-
yond the limits of that portion of their
contract which was aleatory, and un-
dermined those foundations which they
meant to be fixed and certain. The
result should, as it would seem, be the
same, when a compromise is underlaid
by a mistake of fact on a point which
is supposed to be unquestionable, and
which forms the chief inducement for
the compromise of other and doubtful
questions. Whether, therefore, a com-
promise between a party claiming as
heir in tail, and a purchaser from the
ancestor, would be invalidated by the
discovery that the parcuts of the
claimant had not been married, and
that he was consequently not the heir,
should, as it would seem, depend on
the extent and nature of the question
compromised, or in other words, on
what and how much the parties viewed
or treated as doubtful in fact, and
meant to render certain by their agree-
ment. For if the agreement was based
on the supposition that the claimant
was a legitimate son, and that the
only doubt was whether the entail
had been barred by or before the sale,
then the discovery that the former
supposition was unfounded, might
give a right of avoidance, which would
not result from any error" which
had been committed with regard to
the latter. But if, on the other hand,
the agreement was intended to re-
move every actual or possible doubt
STAPILTON V. STAPILTON.
425
or question, and to bind one of the
parties to pay a sum certain for the
real or supposed right of the other,
whether well or ill founded, it would
obviously be unjust to permit the bar-
gain to be rescinded, on the pretext
that what had been bought as doubt-
ful, turned out to be wholly destitute
of certainty or value. In like manner,
when the question in dispute, and
which it is intended to settle, is the
extent or quantum of a right, and not
its existence, the subsequent discovery
that no right exists, may entitle the
party, who suffers by the arrange-
ment, to have it set aside, because the
fact of the obligation is taken for
granted, and the compromise limited
solely to its amount; ante, 395. And
there can be little doubt, that a settle-
ment based on the supposition that an
accouut has been correctly stated, and
exhibits the balance between the par-
ties with exactness, may be set aside
by showing the existence of errors
which passed unperceived,and were of
a nature materially to vary the result;
Ross v. M'Laughlin, 7 Grattan, 86.
In order, however, to call this prin-
ciple into operation, and limit the effect
of a compromise to a particular class
of facts or questions, there should, as
it would seem, be something to show
that it was meant to have a restricted
operation, the object of such arrange-
ments, prima facie, being, to put a
final end to litigation, and to embrace
everything within their scope which
is necessary for the attaiment of that
purpose ; Bennet v. Paine, 5 Watts,
259. And the result of the whole
matter would seem to be, that when
the parties agree to be bound irrespec-
tively of the existence of certain facts,
and whether they exist or not, the
question of their existence will be im-
material to the obligation of the con-
tract, and their non-existence no rea-
son for setting it aside, but that when
a contract is founded upon the sup-
position or admission that a particular
state of things exist, proof of its non-
existence will be a sufficient ground
for the intervention of equity, even
when it does not constitute a good
defence at law ; Ilai/nes v. Thorn, 8
Foster, 386 ; Warder v. Tucker, 7
Massachusetts, 449.
It should moreover be remembered,
that to render the transfer or relin-
quishment of an invalid right, or of a
right which has no real existence, a
sufficient consideration for an agree-
ment of compromise, or for a promise
of any other description, it must ap-
pear affirmatively that a compromise
was intended, or that the parties were
dealing with the right in question as
doubtful, and not as certain ; failure of
title, or the non-existence of that
which forms the subject of a contract,
being prima facie evidence of failure
of consideration, and casting the bur-
den of proof on those who seek to
overcome it. That the plaintiff has
parted with, and the defendant got
nothing by a sale or contract, will
therefore always be a good plea or an-
swer to a suit upon it, unless some-
thing is adduced on the other side to
raise a presumption of a different
nature ; Hai/nes v. Thorn, 8 Foster,
386; and this would seem to have
been the only question presented in
Kaye v. Dutton, and in most of the
other cases, which might at first sight
seem to imply that the purchase of a
right as doubtful, will not give rise to
a liability, if the right prove to be un-
founded.
426
COMPROMISE. — SEPARATE MAINTENANCE.
The difficulty of reconciling and ap-
plying the principles which give vali-
dity to compromises, to the forms of
the common law, is not less, when the
compromise is set up in bar of an an-
tecedent demand, than when it is de-
clared on as new cause of action.
Every accord and satisfaction is, in
one sense, a compromise; and yet it
has always been held, that the validi-
ty of an accord is dependent, in the
strictest sense, upon the sufficiency of
the consideration ; 1 Smith, Leading
Cases, 440, 5th Am. ed. ; and the old
pleaders would hardly have admit-
ted, that a smaller sum could be
rendered a valid satisfaction of a
greater, by an averment, that it had
been paid as a compromise, and would
probably have thought, that such an
allegation added nothing to what ap-
peared by necessary implication with-
out it. The payment and receipt of
a sum certain, might, unquestionably,
always have been a good satisfaction
of a greater demand, which was wholly
unliquidated, and neither certain in
itself, nor capable of being reduced
to certainty by computation, or with-
out the aid of a jury. But the more
recent cases take a wider range, and
establish, that whenever the amount
due on an account or cause of action,
of any description, is doubtful, or be-
lieved to be so, by the parties, it will
fall within the principle which ren-
ders the existence of a doubt, a suffi-
cient consideration for an agreement
destined to remove it, and the accept-
ance, or even an agreement to accept,
a smaller sum than that really due,
may have the validity as a compro-
mise, which it would want as an ac-
cord and satisfaction, and serve as an
effectual barrier against any attempt
to go beyond it, or recover anything
further; Cooper v. Parker, 14 C. B.
118; 15 Id. 822; M Daniels v. Lap-
ham, 21 Vermont, 222 ; Babcock v.
Hawkins, 23 Id. 561 ; Abbott v. Wil-
mot, 22 Id. 437; Lamb v. Goodwin,
10 Iredell, 320 ; Palmerton v. Hux-
ford, 4 Denio, 166 ; Taylor v. Nuss-
baum, 2 Duer, 302 ; Bryant v. Proc-
tor, 14 B. Monroe, 451 ; Donohue v.
Woodbury, 6 Cushing, 148 ; Tattle
v. Tuttle, 12 Metcalf, 551. For,
under these circumstances, the ter-
mination or prevention of litigation,
and the exchange of doubt and con-
troversy for certainty, furnish a new
and valuable element, and obviate
the objection which would other-
wise arise, that the performance of
part of a duty or obligation canuot
serve as a consideration for exonera-
tion from the residue. The law was
so held in JU'Baniels v. Lapham, and
Palmerton v. Iluxford, while in Tut-
tle v. Tuttle, the court went to the
full extent of the proposition, that the
payment of a smaller sum may be a
good defence, on the ground of com-
promise, when it would have been bad
if viewed merely as an accord and
satisfaction. But in order to call this
rule into life, and give it force and
operation, the money must be paid
and received with the express or im-
plied purpose of solving a doubt, and
the claim on account of which the
payment is made be doubtful, in point
of right or amount, or at all events,
not so plain as to be beyond the reach
of a real or honest doubt; Goodwin
v. Follett, 25 Vermont, 386 ; Norris
v. Slaughter, 3 Iowa, 113; Foersch
v. Blackmail, 14 Barbour, 607.
Whatever the rule may be, before
legal proceedings have been instituted,
STAPILTON V. STAPILTON.
427
and while the transaction still remains
in pais, all the cases agree, that the
validity of a compromise of an exist-
ing suit or action, does not depend on
whether the suit could have been pro-
secuted to a successful issue, and may
be enforced against the defendant,
even when the claim of the plaintiff
is shown to have been destitute of all
validity ; ante, 416; Longridgex. Dor-
ville. Thus, in Edwards v. Baugh,
Lord Abinger expressed the opinion,
that the settlement of a pending ac-
tion was a good consideration for a
promise by the defendant, indepen-
dently of the validity of the cause on
which the action was founded ; be-
cause it enabled him to avoid the ex-
pense and trouble which would have
been incident to resistance, however
successful. A similar view was taken
soon afterwards, in Smith v. Mon-
tieth, 13 M. & W. 427, and the re-
lease of the defendant from custody,
under a capias, held sufficient to sus-
tain a promise to pay a sum certain,
notwithstanding a plea, that there was
no cause of action or demand, in re-
spect whereof the plaintiffs could have
recovered in the suit in which the ar-
rest was made, and that they did not
give up or part with any available re-
medy, by discharging the defendant,
which the plaintiffs well knew, but
which was unknown to the defendant;
on the ground that the plea did not
show that the plaintiffs knew that
they had no right or cause of action,
although they might have known that
they had none, which could be pro-
secuted with effect, in the proceeding
in which the defendant had been ar-
rested. And this decision is sustain-
ed by that of 0' Kelson v. Barclay, 2
Penna. 531, where a note, given as a
compromise of^an action for slander,
was held binding, notwithstanding the
argument, that the plaintiff had, as
the declaration showed, no cause
of action, and that there was, con-
sequently, no room for the doubt,
which should lie at the foundation of
every compromise. The principle is
the same, whether the consideration
consist in the relinquishment of a
defence, or the discontinuance of an
action ; and the withdrawal of a plea
will give the validity to the payment
of a smaller sum, in satisfaction of a
larger, which it would want, if view-
ed solelyas an accord and satisfaction,
whether the plea thus withdrawn could
or could not have been sustained by
proof, and, as it would seem, even when
its invalidity is apparent on its face.
The law was so held in the Court of
Common Pleas, and subsequently on
error, by the Exchequer Chamber, iu
Cooper v. Parker, 14 C.B. 118; 15 Id.
822 ; and the waiver of a defence
which had been made on the ground
of infancy, followed by the payment
of £30, and the costs of the action,
said to be a good satisfaction of a de-
mand for a larger sum, whether the
defence which had been abandoned,
was or was not true, or susceptible of
being substantiated by evidence.
The same view has been taken in
this country, without, as it would
seem, any exception ; even those
courts which hold that the relinquish-
ment of an invalid right will not ope-
rate as a consideration, before a suit
has been instituted, conceding that
the compromise of a pending suit or
litigatiou, cannot be avoided by show-
ing that the party who seeks to en-
force it, had no defence or cause of ac-
tion, and that the other party was led
428
COMPROMISE. — SEPARATE MAINTENANCE.
to make a sacrifice for which he re-
ceived no corresponding equivalent;
Morey v. New/ane, 8 Barbour, 645 ;
Sherman v. Barnard, 19 Id. 202;
Prater v. Miller, 52 Alabama, 320 ;
Stewart v. Bradford, 26 Id. 410 ;
Paris v. Dexter, 15 Vermont, 370.
The compromise of a suit is, how-
ever, fully within the rule, which ren-
ders good faith and frankness especi-
ally necessary, when aleatory contracts
are in question, and will not permit
either party to treat a fact or right as
doubtful, which he knows to be cer-
tain ; ante. Hence, a plea or aver-
ment, that the plaintiff in a suit knew
that he had no demand or cause of
action, which could have been enforc-
ed against the defendant, in that or
any other proceeding, will be a suffi-
cient reason for refusing to enforce
or for rescinding an agreement, by
which the suit was compromised at
the expense of the defendant ; Wade
v. Simeon, 1 C. B. 610; 2 Id. 548.
And it would seem questionable,
whether a compromise can be bind-
ing in favor of any one, who had no
interest in the succes or failure of the
demand or suit out of which it grew,
or which it was intended to terminate ;
and in Bush// v. Conoway, 8 Mary-
land, 55, and Seaman v. Cook, 12
Wend. 381, the withdrawal of oppo-
sition to the probate of a will, was said
not to be a sufficient consideration for
a promise, unless the promisee would
have had some right or interest in the
estate of the testator, if the will had
been set aside.
The general principles which lie at
the foundation of agreements of com-
promise, and regulate the relations
between the parties, were clearly stated
in the case of Barloic v. The Ocean
Ins. Co., 4 Metcalf, 270, where the
defendants alleged that they had dis-
covered additional evidence of the
fraud, which had been the ground of
their resistance to the claim of the
plaintiff, in the first instance, and
consequently refused to pay a note
which they had given, by way of set-
tlement and compromise.
The relinquishment of part of an
unfounded claim, was said not to be
a sufficient consideration for a promise
to pay the residue, at all events, when
the promisor was ignorant of the true
circumstances of the case, and of his
rights and remedies, and consequentby
entitled to relief, on the ground of
mistake, if for no other reason. But
the court were clearly of opinion, that
the compromise of a doubtful right or
controversy, carries with it a sufficient
consideration, and cannot be invali-
dated by the discovery of new or ad-
ditional evidence, on any point or
question, which was known at the
time," and embraced in the compro-
mise, although the result may be
different, when new and unexpect-
ed facts or grounds of defence come
to light, or are discovered subse-
quently. " If the facts," said Hub-
bard, J., in delivering the opinion of
court, " which were offered to be
proved in this case, had been of an
entirely differeut character from those
which gave rise to the compromise,
and would have constituted a substan-
tial and independent defence to the
claim ; or if the facts now newly dis-
covered by the defendants, had been
known to the plaintiffs, at the time of
the compromise, and had been design-
edly concealed by them, or if they
had been personally implicated in re-
lation to them, a case might have
STAPILTON V. STAPILTON.
429
been presented by tbe defendants, re-
quiring very careful consideration.
But in the present instance, the evi-
dence which is offered consists of facts
of the same nature with those, the
alleged existence of which led to the
compromise. They do not constitute
an independent ground of defence.
They alike go to prove that the ves-
sel was designedly cast away by the
master; and no suggestion was made,
on the trial of this case, against the
integrity and good faith of the plain-
tiffs, or of their agents in Boston, or
that they had any knowledge of the
manner in which the vessel was be-
lieved by the defendants to have been
destroyed. Nor was any attempt made
to prove that they were guilty of any
misrepresentation or fraudulent or de-
signed concealment of material facts,
at the time of making the compro-
mise ; nor is it pretended that they
were not interested in the subject of
the insurance, to the amount-insured.
So far as appears, both plaintiffs and
defendants were alike ignorant at the
time of effecting the settlement.
" The case, therefore, is simply this :
A party effects a policy of insurance,
and upon the happening of a loss, the
underwriters refuse to pay, on the
ground that the master, who was in-
terested in the vessel, and had a se-
parate insurance upon such interest,
made a fraudulent loss of the vessel,
by casting her away ; and in conse-
quence of such alleged defence, the
plaintiffs, in good faith on their part,
submit to compromise their claim, and
take three-fourths for the whole.
Shall such compromise be set aside,
by reason of the subsequent discovery,
by the defendants, of other and dis-
tinct facts, going still more clearly to
prove that the. master bored and scut-
tled the vessel, and so occasioned the
loss ? And to the question thus stat-
ed, and which presents the defend-
ants' case, we have no hesitation in
answering that the compromise ought
not to be disturbed. No adequate
cause exists for disturbing it. No
fraud is imputed to the party making
it, and there is no such mistake of
facts as led the defendants to an im-
provident settlement, and which good
faith might require should be revised.
The parties stood in the same position
as to information. One believed a
fraud had been committed, which, if
proved, would establish his defence.
The other feared that it might be so.
Under these circumstances, they came
together, and without misrepresenta-
tion or fraud on either part, they en-
tered into a compromise by which one
party received less than the amount
of his contract, which, if free from the
taint of fraud, would be wholly due,
and the other saved a part of what he
was bound to pay, unless he should
succeed in establishing the existence
of such fraud. Each party understood
the law of his case; each understood
the bearing of the facts ; and with
such knowledge the agreement was
made. An agreement so made is upon
a substantial consideration ; and why
should it not be enforced ? No new
fraud is discovered; no new ground
of defence to the original contract has
arisen ; nothing to show that it was
originally void. But the defendants,
on further investigation and search,
have now put themselves in possession
of facts, by which they ascertain more
accurately the manner, as they believe,
of the commission of the fraud which
was the subject of the negotiation and
430
LIABILITY OF TRUSTEES AND EXECUTORS.
compromise j and they are now satis-
fied, that if no compromise had been
made, and more time had been taken
by them, the fraud could have been
distinctly proved, and the plaintiffs'
right of an action defeated. But the
apprehension of the plaintiffs, that
such might be the case, and the fear
of the defendants, that it could not
be established, led to the settlement ;
and each party sat down and agreed
to share the loss, though in different
proportions. To disturb a settlement
made under such circumstances, in-
stead of promoting the ends of jus-
tice, would enlarge the field of dis-
cord, and would raise new obstacles
o compromises between parties, and
thus create a just cause of regret; as
such agreements are usually founded
upon mutual concessions, and gene-
rally with advantage to each party."
This case was cited with approbation,
in Attis v. Billings, 2 Cushing, 19,
and the discovery, that a man of
weak mind had used artifice, to induce
the plaintiffs to make a compromise
with the committee or guardian, to
whose care his estate had been en-
trusted by the court, held insufficient
to justify the re-opening of the con-
troversy; the guardian having been
free from all imputation of wrong, and
there being nothing to show that the
impression produced on the minds of
plaintiffs was false, although fraudu-
lent means had been used to produce
it.
LIABILITY OF TRUSTEES AND EXECUTORS.
[*718] *TOWNLEY v. SHERBORNE.
SATURDAY, JUNE 6, 9 CAR. 1.
REPORTED BRIDG. REP. 85. '
Liability for a Co-trustee.] — How far a person is liable for the acts and
receipts of a co-trustee.
Upon hearing and debating of the matter, as well on the 15th as the 18th
of June last, the Court being assisted with Mr. Justice Hutton, and Mr. Jus-
tice Jones, upon the plaintiff's bill of review, for the reviewing and reversal
of a decree made in a cause, wherein Richard Mountford, deceased, executor
of Thomas Challoner, was plaintiff, against the now plaintiff, and Thomas
Forster, Esquire, concerning the sum of £1700, raised out of the rents and
profits of certain lands and tenements in Linsted, Ardingley, and Worth, in
the county of Sussex, in trust for the said Thomas Challoner, during his
minority, and which the now plaintiff, by the decree of this Court, was to pay.
in case the said Forster should fail to pay the same.
Several matters were offered by the plaintiff's counsel, for the reversal of
i S. C. Cro. Car. 312.
TOWNLEY V. SHERBORNE. 431
the said decree, namely, that the now plaintiff was decreed to pay the sum of
£1700, as raised out of the profits of the infant's lands, settled upon an
account made up by the said Forster with the said Thomas Challoner the in-
fant, after he came of age, whereto the plaintiff Townley was neither party
nor privy, nor ever consented, nor ought to be bound thereby.
And secondly, that the said plaintiff is by the said decree made liable to
the payment of all the profits raised out of the said infant's estate, whereas
he never received any profits at all ; and although he gave some acquittances,
yet, *the same were only for the three first half years, and no more,
and were but to balance an account, the moneys disbursed amounting L -*
to as much as the receipts; and there being three other co-trustees with him,
the plaintiff's counsel conceived that he ought not to be charged with more
than he himself received, especially for that the other parties trusted, and
who received the profits, were, or were reputed to be, men of ability and re-
sponsible. Touching which last point, (being that whereon the plaintiff's
counsel chiefly insisted for the reversal of the said decree as against the now
plaintiff,) it appeared unto this Court that Challoner, father of Thomas the
infant, did heretofore make a lease of the said lands to one Weeks, for five-
and-thirty years, and afterwards conveyed away the reversion to Thomas Chal-
loner, his brother; and after the death of Francis (according to an award
made between the said Weeks and Thomas Challoner the brother, who was
uncle to Thomas the infant) the lease of five-and-thirty years, and the rever-