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Reports of cases adjudged in the Supreme court of Pennsylvania [May term 1841 - May term 1845] (Volume 4) online

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cannot be done by his own declarations, or anything which he may
prove in this suit ; for whether it be his money or the money of his
principal, is a matter totally indifferent to the present defendant.

But it has been insinuated rather than urged, that an execution,
having been issued by the attorney after the date of the order, is
a revocation of the authority to the agent. Whether the execution
was issued by the command of the principal or the agent does not
appear, nor is it very material that it should ; for without entering
into the question whether the attorney on the record would have
been justifiable in paying it to Burgoon, we are of the opinion that
it would be a good payment, whether made to the attorney or the

But, finally, it is contended that a payment, after the death of
the principal, is not good. It is conceded that the death of the
principal is ipso facto a revocation of a letter of attorney. But
does it avoid all acts of the attorney intermediate between the
death of the principal and notice of it ? In Salte v. Field, (5 Term
Rep. 214), Mr. Justice Buller observes, " It has been questioned
with respect to an agent acting under a power of attorney, whe-
ther acts done by him before he knows of the revocation of his
warrant, are good against the principal; and it seems that the
principal in such case could not avoid the acts of his agent, done
bonafide, if they were to his disadvantage, though he might consent
to avoid such as were for his benefit." And in Hazard v. Tread-
well, (Str. 506) ; 12 Mod. 346, it is ruled, that the credit arising

Sept. 1842.] OF PENNSYLVANIA. 285

[Cassiday v. M'Kenzie.]

from an ostensible employment continues at least with regard to
those who have been accustomed to deal on the faith of that em-
ployment until they have notice of its being at an end, or till its
termination is notorious. And these are principles founded on the
most obvious justice. Thus, if a man is the notorious agent for
another to collect debts, it is but reasonable that debtors should
be protected in payments to the agent until they are informed that
the agency has terminated. But this, it is said, is only true of an
agency terminated by express revocation, and does not hold, of an
implied revocation by the death of the principal. It would puzzle
the most acute man to give any reason why it should be a mispay-
ment when revoked by death, and a good payment when expressly
revoked by the party in his lifetime.

In Watson v. King, (4 Camp. 272), however, it is ruled, " that a
power of attorney, though coupled with an interest, is instantly
revoked by the death of the grantor ; and an act afterwards bona
fide done under it by the grantee before notice of the death of the
grantor is a nullity. Lord Ellenborough says, a power coupled
with an interest cannot be revoked by the person granting it ; but
it is necessarily revoked by his death. How can a valid act be
done in the name of a dead man ?" It will be observed that the
reason is purely technical. How can a valid act be done in the
name of a dead man ? And it might with as much propriety be
asked, how can a valid act be done by an agent whose authority
is revoked by his principal ?

But notwithstanding the opinion thus confidently expressed, it
is now an admitted exception that where the power or authority
is coupled with an interest in the thing actually vested in the
agent, then an act done by him after the death of his principal is
good. And the reason given by Chief Justice Marshall in Hunt v.
Rousmanier, (8 Wheat. 174), is, that the agent, having the legal
title in the property, is capable of transferring it in his own name,
notwithstanding the death of the principal ; and the death of the
principal has no operation upon his act. The power given by the
principal is, under such circumstances, rather an assent or agree-
ment that the agent may transfer the property vested jn him, free
from all equities of the principal, than strictly a power to transfer.
The whole reasoning of the court, in Hunt v. Rousmanier, shows
their anxiety to rid themselves of the absurdity into which a strict
adherence to the principle that death is a revocation of a power,
would lead them. Why not place it on the rational ground, that
although the conveyance would be bad at law, yet it would be
good in equity when made bona fide without any notice whatever
of the death of the principal. But be this as it may, the principle
does not apply here. There is no act to be done. This money has
been paid by the debtor and received by the agent in good faith ;
and why should it not be good when the authority is revoked by
death, as it confessedly is when expressly revoked by the principal

286 SUPREME COURT [Pittsburgh

[Cassiday v. M'Kenzie.]

in his lifetime ? Here the precise point is, whether a payment to
an agent when the parties are ignorant of the death is a good pay-
ment. In addition to the case in Campbell before cited, the same
Judge, Lord Ellenborough, has decided in 5 Esp. 117, the gene-
ral question that a payment after the death of principal is not
good. Thus, a payment of sailor's wages to a person having a
power of attorney to receive them, has been held void when the
principal was dead at the time of the payment. If, by this case,
it is meant merely to decide the general proposition that by ope-
ration of law the death of the principal is a revocation of the
powers of the attorney, no objection can be taken to it. But
if it is intended to say that this principle applies where there was
no notice of death, or opportunity of notice, I must be permitted
to dissent from it.

In addition, it is contrary to the opinion of Lord Loughborough
in Tate v. Hilbert, (2 Fez. Jun.), where, on a question whether
a check given by a dying person to a relation, but not presented
in his lifetime, could be enforced as donatio causa mortis against
the executor, he said, if the donee had received the money upon
the check immediately after the death of the testator, and before
the cashier was apprised of it, he was inclined to think no court
would have taken it from him. And what would he have said if
the attempt had been made to subject the banker, when he was
ignorant of the death ? But, if this doctrine applies, why does it
not apply to the case of factors, foreign or domestic, to commission
merchants, to supercargoes, and masters of ships, and to various
other agencies which the necessities of commerce may require. In
the case of a foreign factor, for example, has it been supposed that
his acts, after this implied revocation of authority, are void ? Cases
of this kind must often have occurred, and it would astonish the
mercantile world to be informed that the factor was liable on a
contract made in the name of his principal because he was dead,
a fact of which he was ignorant, and of which he could not by any
possibility be informed, or that the merchant who was trusting his
goods on the credit of the principal was to be cast on him who may
have been of doubtful solvency, for payment. Can it be, that a
payment made to an agent from a foreign country, and from one
of our cities to the western States, employed for the special pur-
pose of collecting debts, is void because his principal may have
died the very day before the actual receipt of the money ? That a
payment may be good to-day or bad to-morrow from the accidental
circumstance of the death of the principal, which he did not know,
and which by no possibility could he know? It would be unjust
to the agent and unjust to the debtor. In the civil law, the acts
of the agent, done bonafide in ignorance of the death of his prin-
cipal, are held valid and binding upon the heirs of the latter. The
same rule holds in the Scottish law, and I cannot believe the

Sept. 1842.] OF PENNSYLVANIA. 287

[Cassiday v. M'Kenzie.]

common law is so unreasonable, notwithstanding the doubts ex-
pressed by Chancellor Kent in the 2d volume of his Commentaries,

These principles dispose of all that will be material on another

Judgment reversed, and a venire de novo awarded.

Parke against Smith.

The rule of evidence which excludes a party to a negotiable instrument from
testifying against its validity, is only applicable to cases where the instrument
has actually been negotiated in the usual course of business. But if it be estab-
lished by other proof that the negotiation was not in the usual course of business,
then a party to the instrument, not otherwise interested, is competent to testify
all his knowledge of the transaction.

ERROR to the District Court of Allegheny county.

James Parke against Samuel Smith, Samuel Royer, A. N.
M'Dowell, and John Turbet, trading in the name of Smith, Royer
& Co. The plaintiff claimed on a note dated 24th of May 1837,
for $2632, payable two years after date, drawn by Samuel Hall,
payable to Smith, Royer & Co., and endorsed by Smith with the
name of the firm, Smith, Royer & Co. On the 27th of May 1839,
it was protested, and notice given, &c. It was admitted the
defendants were partners in the iron business. It was contended
for Smith that the note was for a loan by Parke to Hall at an
usurious rate of interest, and for the other defendants that the
endorsement was made by Smith without authority from the other
partners, not in the course of business of the firm, but to accom-
modate the drawer, who passed it to the plaintiff, and as surety
for him, without consideration to the firm.

The defendants read a copy from the record of a mortgage by
Samuel Hall to James Parke, containing a recital that it was to
secure the note in question and several others ; that Parke had
loaned the money to Hall on said notes, which were some of them
renewals of former notes, to secure Parke and the endorsers for
any money they may have paid or shall have to pay, and a cove-
nant by Parke to re-convey or enter satisfaction for any money
paid as it should be paid, so that it was executed by both Hall
and Parke.

The defendants also showed the record of a suit by Parke
against Hall, and judgment on several notes, including this one,

288 SUPREME COURT [Pittsburgh

[Parke v. Smith.]

for $8544.66, of April term 1841 ; also a release to Hall by de-
fendants, executed for the defendants by S. Smith at the bar ; and
offered Hall as a witness. The plaintiff objected because the
release was not valid, and because a party could not be heard to
invalidate a paper to which he gave currency by his name, and
which he put in circulation ; but the court admitted him. The
mortgage showed that the maker passed it to Parke and not the
endorser. The plaintiff also objected that this could not be given
in evidence under the general issue in an action of assumpsit. The
court overruled the objections and sealed a bill of exceptions.

The witness, Hall, proved that the mortgage was given to secure
this and three other notes, amounting together to $2350 ; that the
difference between that and 82632, the amount of the note, was
usury; that no consideration passed between him and Smith,
Royer & Co. ; that he never endorsed for them ; that the endorse-
ment was to accommodate him and written by S. Smith in the
absence and so far as he knew without the knowledge of the other
partners; that he had no conversation with the other partners
about endorsing for him, except once he applied to Turbet, who
was not willing, and it was not done ; that Smith knew he was
using the paper to raise money.

GRIER, President, instructed the jury that including the usurious
interest did not make the note void, but that the plaintiff could
recover from Hall the amount really due, striking off the sum
allowed for usurious interest. But, on the other guound of defence,
the court said that Parke, according to the evidence, did not
receive this note from the defendants, but from the maker, Hall ;
therefore it was known to him the endorsement was merely as
sureties ; one partner cannot bind a firm by signing their name
as sureties, and in a matter not of business, and in which they
have no concern, unless he has previous authority, or there is a
subsequent ratification ; that the credit of the witness was for the
jury ; if his testimony was believed, the plaintiff could not recover;
that the jury must find against all the defendants or none ; they
could not in this case find against Smith alone.

The errors assigned were to the admission of the testimony and
to the law arising on that testimony.

M'Candless, for plaintiff in error, argued that the drawer of
the note was incompetent to testify against its validity ; and cited
1 Rawle 196 ; 2 Whart. 50 ; 9 Serg. $ Rawle 229 ; 9 Watts 144.
A note signed by one partner with the name of the firm, is prima
facie the note of the firm, and the holder is not bound to inquire
of all the individual members of it. 2 Penn. Rep. 160; 24 Eng.
Com. Law 226, 227 ; I Wash. C. C. 100 ; Bayly on Bills 95 ; 7
Serg. 4- Rawle 218.

Craft and Findlay, contra, argued that it was only in cases

Sept. 1842.] OF PENNSYLVANIA. 289

[Parke v. Smith.]

where the note or instrument was actually and fairly negotiated
in the usual course of business, that parties to it were incompetent
to testify ; but here the defence was that it was not so negotiated,
and evidence aliunde was given to support the allegation ; after
which the witness was competent. 2 Watts 268 ; 5 Whart. 340 ;
4 Serg. fy Rawle 109 ; 2 Dall 196 ; 2 Binn. 165 ; 1 Serg. $ Rawle
102 ; 4 Rawle 311 ; 6 Serg. fy Rawle 113 ; 10 Ib. 290 ; 9 Ib. 229 ;
3 Wend. 415. This was a made note, and not one of business,
which was well known to the plaintiff who received it from the
drawer and not the endorser. It is no part of the business of a
mercantile firm to endorse notes as sureties for others ; and the
note being in the hand of the drawer is sufficient notice of the
nature of the endorsement. 18 Wend. 478; 5 Conn. Rep. 574;
Story on Part. 131, 206; 2 Stark. 347 : 1 East 53; 8 Fez. 544; 2
Cox 12; Carey on Part. 37; 7 Wend. 159.

The opinion of the Court was delivered by

HUSTON, J. In the case of Baird v. Cochran, (4 Serg. Sf Rawle
397), it was decided that to exclude parties whose names are on
the bill, but not parties to the suit and not interested, the note
must not only be negotiable but actually negotiated in the usual
course of business ; and in Hepburn v. Cassel, (6 Serg. fy Rawle
115), the same doctrine is distinctly repeated. In 1 Rawle 197, it
is said, " the rule is undoubtedly restricted to paper actually nego-
tiated ;" but that case is put on the ground that the witness could
not, by his own evidence, remove an objection to his own evidence
apparent on the paper ; and, I take it, says the Chief Justice, he
could not. In Gest v. Espy, (2 Watts 268), this case is reviewed
and commented on. It is again said the rule is " that a party to
a note cannot impeach it when it is strictly negotiable and has
been negotiated ;" and again, " if the contest is between the ori-
ginal parties, or between the drawer and a person who has not
become the holder by the usual mercantile endorsement, it is grant-
ed there is no ground for the application of the rule :" again, " it
is necessary for the defendant to prove by testimony aliunde that
the original parties remained the same."

Here it was proved by the mortgage signed by both parties, that
the note, instead of being passed by the endorser, was given by
the maker to the plaintiff. The bare statement shows it was not
received in the usual course of business ; and if authority had
been necessary, the cases cited, 8 Cowen 687, and 18 Wend. 478,
are full to the point. Where the maker offers an endorsed note in
payment of a contract, and especially for a past debt, it is not
offering it in the usual course of business, and is, at least, primd
facie evidence that the endorser is a surety for the maker. If the
transaction were real, the payee would be owner of the note, and
he alone would have a right to pass it away : while the note is in
the hands and is the property of the maker, although it is endorsed
iv. 37 z

290 SUPREME COURT [Pittsburgh

[Parke v. Smith.]

by the payee, yet the parties can support no suit on it against
each other ; when it is passed to a third person, a right of action
on it arises ; but if it is passed by the maker, the payee and en-
dorser is liable as surety or guarantor of the maker, and the holder
who received it from the maker, may write a guaranty over the
blank endorsement. Or if the endorsement was on it when the
note was made and offered by the maker for his own debt, it has
been held the endorser may be held as surety without other evi-
dence. See cases last cited, and Bayly on Bills (last edition)
46-48, and cases in the notes.

Parke then received the note in question, not from Smith, Roy-
er & Co., but from Hall, and he considered and knew the endorse-
ment in fact and law was only as surety for Hall. But this court
decided in Sutton \. Irwine, (12 Serg. &f Rawle 13), that one part-
ner could not, by signing the name of the firm, bind the other part-
ners by a guaranty, not in the course of their business, unless such
act was authorized or subsequently sanctioned by them ; and in
Hamill v. Purvis, (2 Penn. 177), the same point is decided. One
partner cannot bind the firm by an instrument under seal ; this is
the general rule ; one, if not the only, exception, is a release ; 3
Kent 24 ; last ed. 48 ; 3 Johns. 68 ; 1 Wend. 336 ; 4 Binn. 375.

The objection that this could not be proved on the plea of non
assumpsit was rightly abandoned.

Judgment affirmed.

Nickle against Baldwin.

The party's book of original entries is not competent evidence of the delivery
of goods furnished under a special contract.

In an action brought before a justice of the peace to recover the price of goods
sold and delivered, the defendant may give in evidence as a set-off a special con-
tract between him and the plaintiff by which the plaintiff promised to do certain
work for the defendant, and did not, whereby the defendant is entitled to recover
damages for the non-feasance.

ERROR to the Common Pleas of Allegheny county.

Henry Baldwin against John Nickle. This action originated
before a justice of the peace, and was brought to recover a book
account. The plaintiff proved his account. The defendant offer-
ed to prove, by way of set-off, that about the year 1833 there
was an agreement between him and the plaintiff, by which he was
to deliver a quantity of logs to the plaintiff at his saw-mill, and
that the plaintiff was to saw the same on the shares ; that the logs
were delivered by the defendant according to contract ; but that

Sept. 1842.] OF PENNSYLVANIA. 291

[Nickle v. Baldwin.]

the plaintiff instead of sawing them suffered some of them to rot
on his hands, and finally floated these off down the creek, and ap-
propriated the rest to his own use; that since 1836 the plaintiff
went to the defendant and urged him to saw his share of the stuff,
that he promised to do it, but did not.

The plaintiff objected to the evidence, on the ground that it
was a claim of unliquidated damages, and not the subject of set-
off in this suit. The court rejected the evidence and sealed a bill
of exceptions.

The defendant also offered in evidence his book of original en-
tries, to prove the number of logs delivered under the special con-
tract mentioned in the above offer. The court rejected it, and seal-
ed an exception.

Hamilton, for plaintiff in error, on the subject of the first bill
of exceptions, cited 2 Dall 364; 2 Yeates 217; 12 Serg. fy Rawle
275 ; 1 Serg. $ Rawle 477.

Woods, contra, on the same point, cited 2 Miles 399 ; 3 Watts
305 ; 4 Serg. fy Rawle 249 ; 5 Serg. $ Rawle 117.

The opinion of the court was delivered by

SERGEANT, J. 1. The defendant, to establish his set-off, offered
his book of original entries, charging the plaintiff with certain
logs delivered. He admitted that there had been an agreement
made between him and the plaintiff, that these logs were to be
sawed on the shares at the plaintiff's mill, and offered his books,
not to show the agreement or the value of the logs, but the quan-
tity of logs delivered. The competency of such evidence has
been lately decided upon in Lonergan v. Whitehead, (10 Watts
249), where it was held that a party's book of original entries is
not evidence of the delivery of goods under a previous contract
for their delivery. By a special agreement of this kind, the trans-
action is taken out of the usual course of buying and selling, and
the performance of the contract by one, and the breach of it by
the other, are susceptible of proof by the usual kinds of evidence.
No reason of necessity or convenience exists for resorting to this
peculiar kind of evidence, whether it be to establish the quantity
of the article furnished, or any other ingredient in the party's
case. We, therefore, think the evidence was properly overruled
by the court below.

2 and 3. The second and third bills of exception raise the ques-
tion, whether the defendant could set-off his demand against the
plaintiff for a violation of the plaintiff's contract to saw these logs
on the shares. The ground on which it is objected to is, that it
is a demand for unliquidated damages, sounding in tort. It is pos-
sible that as the defendant goes on to aver, that the plaintiff suf-
fered the logs to rot on his hands, and finally floated them off down

292 SUPREME COURT {Pittsburgh

[Nickle v. Baldwin.]

the creek, and appropriated the rest to his own use, he might, in
trover or some other similar form of action, have claimed damages
for these acts as tortious, and if the circumstances of the case
justified it, might have recovered damages even beyond the value
of the logs and interest, and that such a demand would not be
the subject of defalcation or set-off. But the defendant also has
a remedy in assumpsit for a breach of the contract of the plaintiff
to saw these logs on the shares ; and in such an action, the
damages are, in a certain sense, liquidated ; that is to say, there
is a measure within which they must be restrained. For the de-
fendant would not be permitted, in an action of assumpsit for the
breach of the contract, to recover more than the loss he had sus-
tained by that breach, which would be the value of his share of
the logs saw r ed and delivered within a reasonable time, according
to the contract. In such action he waives the tort, and merely
demands to be placed where he would have been had the contract
been performed. He claims damages for non-feasance, for non-
performance of an express contract, not for misfeasance in con-
verting the logs to the plaintiff's own use, or floating them off so
as to be destroyed. This distinction is adverted to in Steigleman
v. Jeffries, (1 Serg. 4* Rawle 477), and seems founded in reason
and justice. The defendant, then, by claiming this set-off, may
be considered as waiving the tort, and demanding merely damages
in assumpsit, amounting to the value which the defendant's share
of the logs would have yielded to him if sawed and delivered ac-
cording to the agreement. It is a case of damages arising ex con-
tractu, capable of liquidation by a legal standard, and therefore
falling within the defalcation Act, as well as within the express
language of the 7th section of the Act of 20th March 1810, by
which the defendant is required in a suit before a justice of the
peace, on pain of being for ever barred, to set-off his demand, whe-
ther founded on bond, note, penal or single bill, writing obligatory,
book account, or damage on assumption.

This section, however, further requires that the damages claim-
ed shall not exceed the sum of $100. Whether that was the case
here, has been nowhere stated, either in the record or in the argu-
ments of counsel. We think it but fair to presume it may have
been within that sum, and to remit the case for another trial.

Judgment reversed, and a venire facias de novo awarded.

Sept. 1842.] OF PENNSYLVANIA. 293

Turnpike Company against M'Anulty.

In an action by a Turnpike Company, a sequestrator may appeal from an award
of arbitrators against the company, and make the oath and enter into the recog-
nizance required by law.

ERROR to the Common Pleas of Indiana county.

This was an action on the case in assumpsit by the president
and managers of the Huntingdon and Indiana Turnpike-road Com-
pany against M'Anulty and Sterrett, in which an award of arbi-
trators was made against the plaintiff. John S. Isett, sequestra-

Online LibraryPennsylvania. Supreme CourtReports of cases adjudged in the Supreme court of Pennsylvania [May term 1841 - May term 1845] (Volume 4) → online text (page 33 of 69)