Connecticut. Supreme Court of Errors.

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Life Insurance Company," but, in the contract of subscrip-
tion he required the corporation to say, and it did say, that
during the three years immediately following that date it
would collect and pay over all dividends declared upon
those shares to him, " the owner thereof; " he required it to
hold them at all times subject to his right to reclaim them
by substituting other satisfactory securities ; he required of
it the payment of six per cent, per annum upon the amount
of. his subscription for this use of them; required it to ask
his consent to the transfer of them to the American National
Life & Trust Company on some unnamed day in the future;
and requlired it to i^transfer these specific shares to him at



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JUNE TERM, 1882. 22T

Russell V, Bristol.

the end of three years. Looking through form to substance,
in legal effect Mr. Bristol agreed to supply additional capi-
tal to the extent of $10,000 to the corporation, to be applied
to the payment of losses upon policies after the exhaustion
of other corporate resources ; to supply it as the trustees
should call for instalments ; and secured the performance
of his undertaking by the pledge of shares, of which he was
to remain the owner until the trustees should exercise their
right to convert them upon his failure to meet their call.
With his knowledge and permission the trustees, upon this
with other similar agreements, regained from the insurance
commissioner the forfeited right to issue policies.

It is quite certain that it was not the expectation of Mr.
Bristol to be compelled to pay literally and at once the
whole or any part of the sum subscribed by him ; that his
intent went no farther than to enable the corporation to
force payment upon him if its business should prove un-
profitable. Therefore the legal effect of the word "pay-
ment," in the acknowledgment given by him as treasurer to
himself as an individual, is that he had done all Uiat he had
agreed to do up to that time ; that is, he had so fortified his
promise to pay upon call as that the commissioner could
legally accept it as capital ; the charter authorizing that
ofiicer to regard as capital paid, capital promised, protected
by approved securities.

The finding is that the American Mutual Life Insurance
Ck)mpany and American National Life & Trust Company
both subsequently became insolvent; that the trustees
totally neglected their duty to call for the promised capital ;
that both corporations passed into the keeping of the
plaintiff as receiver; and that by order of court he, on
February 11th, 1879, oflScially called for the entine amount
of Mr. Bristol's subscription. On that day the liability
which had been, as against Mr. Bristol in life and his estate
after his death, contingent, became certain ; on that date
therefore the cause of action accrued. The surrender by
the treasurer of the corporation to the executors ci Mr.
Bristol of the pledged shares in no way affects his contract;



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228 NEW HAVEN COUNTY.

Loomis V. Bragg.

that stands quite independent of the pledge ; and as his
estate is more than sufficient to redeem his promises it is
quite unnecessary to consider any question as to the dispo*
sition made of them.

The Superior Court is adyised to render judgment against
the defendants as executors for the sum of ten thousand
dollars with interest from April Ist, 1879, in favor of the
plaintiff as receiver of the American National Life & Trust
Company.

In this opinion the other judges concurred.



Clabk^ M. Looios v$. James D. Bbago.

The plaintiff and defendant made a written contract by which the latter
was to hire a piano of the former, of which the price was to be $140, for
twenty-seven nvonths, for which he was to pay five dollars down and five
dollars as rent at the end of each month, until the whole was paid, when
the piano fras to became the property of the defendant; but if default
of any payment was made the plaintiff was to haye the right to retake
the piano and all the defendant's right to it was to cease and the mcmey
paid was to belong to the plaintiff. Held a conditional sale and not a
lease.

The defendant's promise in the contract to pay the monthly rent was not
to be regarded as a promise for the breach of which the plaintiff could
maintain a suit, but the plaintiff's remedy was solely that provided by
the contract, to retake the piano, and hold as forfeited all that had been
paid.

After paying several instalments the defendant made default of payment
He however for several months promised to pay the amount in arrear
and the plaintiff left the piano with him, but he finally failed to make
further payment and returned the piano. Held that these promises,
being on no new consideration, could not be made in themselves aground
of recovery.

AcnOK . on a contract for the purchase of a piano ;
broiight to the City Court of the city of New Haven.
Den^urrer to complaint. Judgment for defendant, (^Stud-
lep^ Jl) Motion in error by the plaintiff! The case is fully
stated in the ojAnion.



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JUNE TERM, 1882. 229



Loomis V. Bra^.



H. p. Arvine^ for the plaintiff.

J. C. Chamberlain^ for the defendant.

Park, C. J. This suit grows out of the following con-
tract between the parties :

" Agreement between C. M. Loomis of New Haven,
Conn., and James D. Bragg of Bridgeport, Conn. Said
Loomis agrees to rent, and said Bragg agrees to hire, one
Albert W. Ladd & Co. piano, No. 1807, price |;140, (cash
95y balance %185,) for the term of twentynseven months
from the fifth day of January, 1881, at the rent of five
dollars per month, payable on the fifth day of each month,
in advance. And it is agreed that if the rent and interest
shall be paid punctually according to agreement, said instru-
ment shall be the property of said Bragg at the end of said
term. And further, if said Bragg shall neglect to pay the
rent and interest falling due at any time, said Loomis shall
be at liberty to enter the dwelling house or premises where
said instrument may be, and take said mstrument into his
possession, and the money already paid shall belong to said
Loomis. And said Bragg is held responsible for all damar
ges, except the usual wear and tear, and to pay all taxes
and insurance on said instrument. The same is not to be
removed from the place of delivery without permission
from said Loomis. Dated at Bridgeport, Jan. 6th, 1881."

The instrument was delivered by the plaintiff, and
monthly instalments were paid by the defendant under the
contract up to the month of May of the same year, when
the defendant made default of payment, and continued to
do so till the month of October following, when he abso-
lutely refused to go further under the contract, and notified
the plaintiff to remove the piano, which was done. During
the time that default of payment was being made, the
defendant oralljr renewed his original promise whenever a
payment became due, and in consequence of this the plain-
tiff suffered the piano to remain in his possession notwith-
standing the default.



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280 NEW HAVEN COUNTY.

Loorais V. Bragg.

These facts are set forth in the plaintiff's complaint, to
which the defendant demurred; and the question is— do
they sustain the claim for damages made in the first count
of the complaint? Or do they support the second count,
which claims a reasonable sum as compensation for the use
of the piano during the time, not covered by his payments,
that the defendant had the use of it ? Or do they sustain
the plaintiff's claim that the defendant shall pay the un-
paid instalments provided for in the contract as set forth
in the third and last count?

The contract upon which the complaint is based purports
to be a renting of the piano for the term of twenty-seven
months at the rate of five dollars per month, but in fact it
is an agreement to sell the piano at the end of twenty-seven
months, when the sum of |135 shall have been paid in
monthly instalments of five dollars each, together with
certain interest, upon condition that if at any time the
defendant shall make default of payment when any instal-
ment or the interest upon the unpaid balance shall become
due, the plaintiff shall have the right to rescind the con-
tract, and take the piano back into his possession, and that
whatever sums shall have been paid shall become the
property of the plaintiff. The contract is similar in all
essential respects to that in the case of Hine v. RoherUy 48
Conn., 267, the only difference being that in that case a
melodeon, valued at the sum of fifty dollars, and a note for
one hundred and forty dollars, payable at a future day, were
given for what the contract termed rent. The court held
the contract to be an agreement for the sale of the organ
when the contract price for it should have been paid. So
here, the terms of this contract are inconsistent with those
of a lease, but are consistent with those of a conditional
sale. The sum to be paid is the entire present value of the
piano, that is, one hundred and forty dollars. That sum,
with the interest, is to be paid in a littlQ more than two
years, when the instrument would be nearly as valuable as
it was at the outset. It is incredible that the defendant
would be willing to pay as rent the entire value of the



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JUNE TERM, 1882. 281

^ %

Loomis V, Bragg.

instrument in so short a time, or that the plaintiff would'be
rapacious enough to demand it. Indeed the fact that the
piano was by the contract to be the defendant's when the
amount should be paid, shows decisively that the monthly
sums were to be paid, not as rent, but as the purchase price.
Furthei more, it was thought important by the plaintiff that
it should be provided that if the defendant should, at any
time, fail to pay the stipulated sums when due, he should
lose the piano, and that all that had been paid should
belong to the plaintiff. There was no necessity for this if
the contract was a lease of the property.

We think it clear that the parties stipulated for a condi-
tional sale of the piano, leaving the sale to be consummated
in the future when the purchase price should be paid. The
plaintiff had the instrument to sell. The defendant desired
to purchase it, but was unable to pay the entire price on the
delivery of the property. The plaintiff was unwilling to
give credit. So the arrangement under consideration was
made, by which the plaintiff was enabled to accomplish his
object by a conditional sale and be safe, and the defendant
to have the use of the piano and pay for it in small sums,
at stated times, according to his ability.

Such was the contract : and we are now to consider the
rights of the parties under it. The defendant failed to
perform it. He made default of payment after having paid
a number of instalments. The contract provides for this
coiitingency, by a forfeiture of all the defendant's rights
under the contract, and of the sums of money that had been
paid. This was considered sufficient protection by the
plaintiff when he entered into the agreement, for he pro-
vided nothing further. The instalments were to be paid
monthly. They exceeded in value the use of the piano for
the same time. Surely, the plaintiff was thoroughly pro-
tected. Had he exercised his rights when the defendant
made his first default in the month of May, this controversy
would never have arisen. He would have had no cause to
complain. But it is said that he indulged the defendant on
his promises to pay the instalments in arrear, till the month



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282 NEW HAVEN COUNTY.

Loomis 9. Bragg.

of October, although he continued to make default during
the time ; and it is claimed that this gives him the right to
recover damages for a breach of the contract ; or the fair
value of the use of the piano during that period; or the
instalments remaining unpaid.

It is not pretended that the defendant was guilty of
fraud in making the promises. It must be taken that thej
were made in good faith, for the contrary is not alleged.
Do they alter the case ? They were merely the repetition
of what the contract stated. The defendant in it promised
to pay all the instalments as they should become due. Can
a repetition make the promise stronger? The original
promise is sufficient to make the defendant pay if he can be
made to pay at all. Besides this, there is no consideration
alleged for the new promises. Had the complaint set forth
that when each default was made the plaintiff was about to
exercise his rights under the contract by claiming a forfei-
ture, when the defendant proposed that if the plaintiff
.would forego his rights he would pay the overdue instal-
ment, and the plaintiff so agreed and granted the indul-
gence, and in consideration thereof the defendant made the
promise^ a different case would have been presented. There
would have been something more than a repetition of the
original promise. But nothing appears in the complaint
beyond the fact that the defendant made the promises and
the plaintiff, relying upon them, left the piano in his posses-
sion. For ^ught that appears nothing was said by the
plaintiff to the defendant to induce him to make the prom-
ises. It does not appear that he made any di^losure of what
he intended to do. Consequently the promises are left
wholly without consideration.

We think therefore that the demurrer was well taken to
the first count of the plaintiff's complaint, for the reason
that the plaintiff's remedy is set forth in the contract. He
should have reclaimed his piano on the first default,
indeed, the defendant had the option by the contract at
any time to surrender the piano and lose the instalments he
had paid. There could be, therefore, no claim for damages
other than the instalments, which the plaintiff already had.



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JUNE TERM, 1882. 288

Security Int. Co. v. St Paul Ins. 06^

We think also that the demurrer was well taken to the
second count, for the reason that the defendant held the
piano under a special contract, which continued in force
until it was surrendered in the month of October, and
therefore there could be no implied agreement. And for
the same reasons we think the demurrer was well taken to
the third count.

There is no error in the judgment appealed from.

In this opinion the other judges concurred.



The Security Insurance Company vs. The St. Paul
Fire and Marine Insurance Company.

Several Insurance companies combined to defend against a claim for a loss
by fire, agreeing that each should pay such proportion of the expense as
the amount of its insurance bore to the whole amount of insurance, and
appointing a committee to manage the defence with full power to incur
all necessary expense. The plaintiff, one of the companies, was after-
wards sued by a person employed by the committee, for his services in
the matter; it did not plead in abatement the non-joinder of the other
companies, but the fact that the suit was brought was known to the
present defendant, one of the companies, which did not request that
such a plea be filed ; and judgment was recovered against the plaintitf
for the whole amount of the claim, besides which it was subjected to
considerable expense and cost in the suit The present defendant had
objected to the claim made in that suit as unreasonable in amount and
the present plaintiff defended against it on that ground, but it was
admitted in the present suit to have been reasonable. The plaintiff
afterwards brought a suit for contribution against the present defendant,
which was the only company within the jurisdiction of the court, and
the policy of which was of the same amount with the plaintiff's. At
this time several of the companies had become insolvent or were dis-
solved and were without assets. The plaintiff had collected a portion of
the amount from some of the other companies. Held —

1. That by the agreement the signers subjected themselves to a joint
liability to all persons rendering service to their agent, the committee.

2. That the provision that each company should contribute in proportion
to the amount of its insurance, operated only as a nile of apportionment
among themselves, and did not affect an outside creditor.

8. That although the plaintiff when sued might have pleaded \fi abfttd-



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1



284 NEW HAVEN COUNTY.

Security Ing. Co. o. St. Paul Ins. Co.

ment the non-joinder of the other companies, it was not bound to do so
as against this defendant, without its request, it having Icnowledgo of
the suit.
4 That the companies that were insolvent were to be laid out of the case
in determining the amount that the other companies were bound to con-
tribute to the plaintiff.

5. That the defendant, being the only company within the jurisdiction
of the court, might be sued alone for contribution, and, its policy being
of the same amount with the plaintiff's, was liable in the suit for half
the amount remaining unpaid.

6. That the defendant was also liable to pay an equal share of the
expense and cost to which the plaintiff was subjected in the suit of the
creditor, the defendant objecting to the creditor's claim as unreasonable
in amount, and it being proper in the circumstances that the plaintiff
should not pay it until it had been judicially investigated.

7. That it was not necessary that the defendant should be judicially con-
cluded by that judgment, since, the claim being now admitted to be
reasonable iu amount, the defendant would have been holden if the
plaintiff had paid it without a suit.

8. That the plaintiff and defendant were entitled to contribution from
the other companies for what they had paid beyond their shares.

Suit for a contribution ; brought to the Superior Court.
The principal allegations of the declaration were as fol-
lows : —

1. Prior to the 24th of April, 1874, the defendant with
the plaintiff and other insurance corporations, had severally
issued policies of fire insurance to Messrs. Taylor, Randall
& Co., of Boston, Massachusetts, upon property on Central
Wharf in said Boston, the policies of the defendant and
plaintiff being each for the sum of twenty-five hundred
dollars, and, prior to said date, said insured property had
been destroyed by fire, and, on said date, claims were being
made by the insured on said policies against the defendant
and plaintiff and said other insurance corporations.

2. Prior to said April 24, 1874, the plaintiff and defen-
dant, together with the German Insurance Company, of
Erie, Pennsylvania, which had a policy of insurance on said
property of $5,000, and the Mississippi Valley Insurance
Company, of Memphis, Tennessee, which had a policy of
insurance on said property of $5,000, the Mechanics and
Traders Insurance Company of New York City, the Kings*
County Fire Insurance Company of New York, the Frank-



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JUNE TERM, 1882. 286

Security Ins. Co. v. St. Paul Ins. Co.

lin Insurance Company, of Indianapolis, Indiana, the Frank-
lin Insurance Company, of Wheeling, West Virginia, the
Lafayette Fire Insurance Company, of New York City, the
Adriatic Fire Insurance Company, of New York City, the
Oswego & Onondaga Insurance Company, of Baldwinsville,
in the state of New York, the Ben-Franklin Insurance Com-
pany, of Alleghany, Pennsylvania, the Hibemia Mutual
Fire Insurance Company, of Newark, New Jersey, the Globe
Insurance Company, of Chicago, Illinois, and the Clay
Insurance Company, of Louisville, Kentucky, all which said
companies had severally policies on said insured property,
each of |2,500, had determined that the claims made on
said policies by the insured were fraudulent and invalid,
and on said last mentioned date the plaintiff and defendant
and said other insurance corporations mentioned in this
article, entered into and signed the following written agree-
ment with each other :

" Jn re Taylor, Randall & Co. vs. St. Paitl Fibb &
Mabene Ins. Co. et als. The undersigned insurance com-
panies having policies outstanding, issued to Taylor, Randall
& Co., upon property on Central Wharf, Boston, upon which
claims have been made against said companies, do, in con-
sideration of one dollar by each paid to the other, and divers
other good and valuable considerations, mutually covenant
and agree to and with each other as follows, that is to say,
the said companies will unite in resisting the claim made
upon said policies, and on each thereof, and in the defence
of any and all suits and legal proceedings that have been
or may be instituted against any of said companies upon any
of said policies, and will, when and as required by the com-
mittee hereinafter mentioned, contribute to and pay the
costs, fees and expenses of said suits and proceedings pro
rata, that is to say, each company shall pay such proportion
of said costs, fees and expenses as the amount insured by
said company shall bear to the whole amount insured on
said property by all the companies subscribing to this agree-
ment ; the management and conduct of said resistance to
said claims and defence of said suits and proceedings shall



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286 NEW HAVEN COUNTY.

Security Ins. Co. ». St. Paul Ins. Co.

be and is fully entrusted to and devolved upon a committee
to be composed of W. H. Brazier, of the city of New York,
Charles W. Sproat, of the city of Boston, James R. Lott, of
the city of New York, and L. S. Jordan, of the city of
Boston ; which committee shall have full power and author-
ity to employ counsel and attorneys to appear for said
companies and each thereof and defend said suits and legal
proceedings, and to employ other persons for other services
relative thereto, and to assess 'Upon and demand and receive
from such companies from time to time, as such committee
shall deem proper, such sum or sums of money, for the com-
pensation of such counsel and attorneys, and such other
persons, and all other expenses of such defence of said suits,
as said committee shall deem necessary and expedient ; such
assessment upon and payment by each of said companies, to
be pro-rata as above mentioned. Each and every of said
companies shall fully and faithfully adhere to this agree-
ment, and shall refrain from any act or proceedings in
reference to such claims or suit or the defence thereof, that
can or may in anywise defeat, obstruct or interfere with the
acts or proceedings of said committee relative thereto, and
shall at all times furnish to said committee any and all
papers, information and assistance in and about such man-
agement and conduct of such resistance and defence, as may
be in the possession or power of said companies respectively
and as may be desired by said committee. In witness
whereof, the said insurance companies have subscribed this
agreement, the 24th day of April, 1874."

8. At the time of the execution of said agreement suits
were pending in Massachusetts against the Franklin Insur-
ance Company of Indianapolis, and the Clay Insurance
Company of Kentucky, and the defendant, and the caption
of said agreement refers to such suits.

4. Mr. Edward T. Woodward, of said Boston, was duly
employed, under said agreement, on behalf of the subscri-
bers thereto, to assist in the defence of said suits as an
export on sundry matters therein involved and for other
purposes, and in pursuance of such employment the said



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JUNE TERM, 1882. 28T

Security Ins. Co. v. St Paul Int. Co.

Woodward rendered great and valuable services in the
defence of said suits.

6. After long and exhaustive trials the plaintiffs in those
suits were beaten on the merits of the controversy, and it
was established as the result of said suits that the plaintiffs
therein would not be able to enforce their claims against the
subscribers to said agreement.

6. At the close of said suits said Woodward presented
to the committee mentioned in said agreement a bill for his
services, amounting to the sum of $5,000, which bill was
approved by said committee and was reasonable, and was so
adjudged by the United States Circuit Court as below
stated.

7. In a reasonable time thereafter said committee levied
an assessment upon the companies who were parties to said
agreement, to pay the bill of said Woodward and other ex-
penses incurred in said suits, but no company paid its assess-
ment; each of said companies, including the defendant,
alleging the bill to be unreasonable in amount.

8. In the year 1879 said Woodward sued this plaintiff in



Online LibraryConnecticut. Supreme Court of ErrorsConnecticut reports: containing cases argued and determined in ..., Volume 50 → online text (page 21 of 61)