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Reports of cases adjudged in the Supreme court of Pennsylvania [May term 1841 - May term 1845] (Volume 6) online

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class, then to distribute and pay the same from time to time, pro
rata, on account thereof. And if any surplus should remain, then
to pay over the same to the said George, his executors, adminis-
trators or assigns: Provided," &c. (proviso as to the responsibility
of the parties). "And provided further, that nothing herein con-
tained shall be construed to prevent any proceedings on the said
bond, before said note may become payable for the whole amount
thereof; it being understood and agreed, at the execution of said
bond, that the same may be proceeded upon at our discretion,
either for the security of the debts before- mentioned, or for the
timely provision of funds for the payment of said debts and notes,
or otherwise, as to us should seem requisite, notwithstanding said
notes should not be payable according to their tenor."

On the 28th June 1837 the following amicable agreement, signed
by M'Callmont and Nixon, was filed :

" Henry Nixon, who survived J. C. Stocker, vs. George M'Call-
mont. Dt. Ct. Scire facias to revive judgment. D. S. B.
March 12, 1832. For $91,500.

It is hereby agreed that the above judgment shall be, and the
same is hereby revived for the sum of 89240, the whole amount for
which the same was given having been fully paid and satisfied,
except the debt due to the Bank of North America, of which the
principal is $4620."

The plaintiffs then offered proof of the amount of interest due
to them on their debt at the time of the entry of this last judgment,
(28th June 1837). This evidence was objected to by the defend-
ant ; and on an intimation from the court that under the plead-
ings it could not be received in that stage of the cause, was with-
drawn for the time.

The defendant then gave in evidence the following receipts
endorsed on the agreement for judgment and signed by Nixon :

" Received of George M'Callmont 82620 on account of the debt
due as above, November 20, 1838, leaving 82000 yet due."

"Received June 25, 1839, of George M'Callmont 81000 on
account of the within bond, leaving a balance due of 81000."

The plaintiffs then, for the purpose of showing the amount of
interest due by the defendant at the time of the confession of the
judgment of 1837, after reading a notice to the defendant to pro-
duce an account dated April 26, 1837 and transmitted to the
defendant by the cashier of the Bank of North America, called the
cashier to prove he had sent the account to the defendant, a copy
of which was produced, and that the defendant had acknowledged
the receipt of it. This evidence was objected to by the defendant
and overruled by the court, who sealed an exception.



Dec. 1843.] OF PENNSYLVANIA. 161

[Nixon v. M'Callraont]

This account was headed, " Statement of interest on George
M'Callmont's notes endorsed by Henry Nixon." It charged the
interest and gave credit for the various dividends received, and
closed with a balance due of $4620 with interest from the 9th
August 183G (when the last dividend was received) to the 26th
April 1837.

The plaintiffs further offered the following letter from M'Call-
mont to Nixon, dated June 22, 1837 : " Dear Sir, It is my wish
to have the bond cancelled which I gave to you and J. C. Stocker
in 1832, as trustees, and to give you one for the balance due on the
principal, viz. $4020, with stay of execution for six months. In
relation to the interest due, I will give you the notes of G. M'Call-
mont & Co., payable at such periods as we may agree upon say
six, nine and twelve months." This evidence was objected to by
the defendant and rejected by the court, and an exception sealed.

The plaintiffs further offered in evidence an account dated 19th
February 1840, sent to the defendant by the cashier of the Bank
of North America, and produced by the defendant on notice. This
account was headed, " George M'Callmont & Henry Nixon, Dr
to the Bank of North America for the following notes drawn by
George M'Callmont and endorsed by Henry Nixon (and interest
thereon)." It commenced in 1832 and ended 31 si January 1840,
and stated the interest due and dividends received, and closed with
a balance of 84101.48 interest and 81000 principal; total 85101. 48.
The defendant objected to this account, but the court overruled
the objection and allowed it to be read to the jury, instructing
them at the same time that no part of the account referring to
matters antecedent to the entry of the agreement to revive the
original judgment on the 28th June 1837, was to be taken or con-
sidered by them as in any way whatever affecting such agreement,
or the amount of the judgment of revival, or as a guide to them in
assessing or ascertaining the sum for which they were to give a
verdict in the present case; but that the same was to be under-
stood to be wholly and entirely inoperative. The effect of the
entries referring to matters subsequent to the 28th June 1837, was,
however, a proper subject for their consideration. The plaintiffs
excepted to this instruction.

The plaintiffs then offered in evidence the notes of the defend-
ant, endorsed by Nixon and referred to in the declaration of trust
as intended to be secured by the original judgment, but they were
severally objected to by the defendant and rejected by the court,
who sealed an exception.

The Judge charged the jury as follows:

The judgment is conclusive evidence of the amount which it
was taken to secure. If the plaintiff had antecedent rights, which
might have been included in the judgment but were not, we can-
not notice them in this action. The utmost, then, which the
plaintiff could have demanded, if we suppose nothing had been
vi. 21 o*



162 SUPREME COURT [Philadelphia

[Niion v. M'Callmont]

paid, would have been 84620, with interest at six per cent, from
the time the judgment was confessed to this time; but whatever
the defendant has paid upon the judgment since it was given,
should be allowed him. The defendant claims to be allowed two
sums, viz. $2620, paid on the 20th November 1838 a receipt has
been read, showing this payment, concluding with the words,
" leaving $2000 yet due ;" the other sum is $1000, paid on the 25th
January 1839 a receipt has been given in evidence, showing the
payment of this sum, concluding with the statement " leaving a
balance due of $1000." You will therefore proceed upon these
principles. Compute the interest upon the debt mentioned in the
judgment, till the time of the first payment, and then deduct from
the debt and interest so computed, the first payment of $2620 ;
then compute the interest upon the balance up to the time of the
second payment of $1000, and then deduct that ; and then proceed
to compute the interest upon the balance until the present time.

But an account has been given in evidence, showing, it is said,
a balance of $5101.48 due on the 19th February 1840. This ac-
count includes matters which transpired between the parties before
the date of the judgment in question, as well as two payments
since. This paper cannot have the effect of enlarging the judg-
ment. The utmost that the plaintiff can receive under this judg-
ment, is the sum which it was confessed to secure, with lawful
interest. If there is any hardship in this rule, we cannot help it.
The legal effect of a judgment of a court of record is as well de-
fined as anything else. If the plaintiff was entitled to a sum for
interest at the time of the confession of the judgment, which was
not included in it, the plaintiff cannot recover it in this action,
however just his claim for it may be. The plaintiff cannot get
more out of the judgment than is in it. I did not feel at liberty,
however, to reject this account when offered in evidence. Had the
receipts for the $2620 and the $1000 been so expressed as not to
appropriate those sums to the judgment, the account might have
been very important evidence upon the question of appropriation.
But the receipts appropriate the payments expressly ; the first
receipt is said to be " on account of the debt due as above," and
that receipt is written at the foot of the agreement to confess the
judgment. The other receipt purports to be " on account of the
within bond," but within is the agreement to confess the judg-
ment. It is not, properly speaking, a bond, but the same, you
perceive.

It is contended by the defendant that the utmost which can be
recovered is $1000, with interest from the 25th January 1839.
The argument is founded on an expression in the receipt of that
date, that only $1000 was due. An expression of this kind in a
receipt is not absolutely conclusive. The right of the plaintiff
was to have interest from the date of the judgment, and the defend-



Dec. 1843.] OF PENNSYLVANIA. 163

[Nixon v. M'Cullmont]

ant is bound to show either that the interest is paid, or some
agreement between the parties that it should not be demanded.
The defendant relies on the expression in the receipt before referred
to, in which the balance is stated, and also upon the account which
was given in evidence by the plaintiff dated 19th February 1840.
But the part of the account relied on refers, as I have said, to
matters which transpired before the judgment, and should not be
allowed to vary the rights of the parties under it. As to the ex-
pression in the receipt touching the amount due, it does not appear
to me to be anything more than such a general statement as would
be made when a receipt is given without a calculation of interest
But this is a question for you to consider.

The jury retired, and after some time returned into court and
requested the Judge to explain that part of his charge which
related to interest since the revival of the judgment in 1837.

The Judge further instructed them:

1. That they had no right to take the sum of $9240 as the
amount due in 1837 and so settled by the parties; but that they
must take the sum of $4620 as the agreed and settled debt then
existing, and charge interest on that sum only, unless they could
find in the papers in evidence something to induce them to believe
that the parties had made a contract to charge no interest.

2. That they were not authorized by any evidence in the cause
to go behind the judgment of June 1837 and charge the defendant
with interest then due ; and that they had no right to take the ac-
count of February 19, 1840 as evidence of anything prior to June 28,
1837; and could not infer any agreement or consent on the part
of the defendant to allow interest, except on the sum of $4620 from
the 28th of June 1840.

The plaintiffs excepted to the charge and assigned errors in the
bills of exception and charge of the court.

Williams, for the plaintiff in error.
Markland (with whom was Meredith), contra.

The opinion of the Court was delivered by

ROGERS, J. The fundamental error, which lies at the root of
the case, arises from the opinion of the learned Judge, that the
judgment of revival of the 28th June 1837 was for the precise sum
of $4620, and consequently drawing the necessary conclusion from
these premises that nothing could be given in evidence anterior to
that time to vary the amount. We, however, conceive it to be a
judgment for the sum of $9240 given for a special purpose, viz. as
a collateral security for a debt due the Bank of North America,
for which the plaintiff had become bound as an endorser for the
defendant. The principal of the debt, as appears by the agree-
ment filed of record, was $4620 ; but from this it does not follow



164 SUPREME COURT [Philadelphia

[Nixon v. M'Callmont.]

that that sum was the amount of the debt. Indeed the very
reverse would seem to be its most natural interpretation. " It is
hereby agreed that the above judgment shall be and the same is
hereby revived for the sum of $9240, the whole amount for which
the same was given having been fully paid and satisfied, except the
debt due to the Bank of North America, of which the principal is
$4620." It is given to secure the debt due the bank ; and what is
the debt but the principal and interest ? The principal of the debt
is one thing, the interest is another ; the aggregate amount of both
constitutes the debt due. The word " principal" is a designation
or description of the debt intended to be secured by the judgment.
Suppose the parties had used this language; "except a note or
bond due the Bank of North America, of which the principal is
$4620 ;" would it be seriously contended that the word " princi-
pal" was anything more than the description of the note or bond,
and would it be insisted that the plaintiff would be entitled to a
security for that amount only, although at the time of the agree-
ment several years' interest was due and unpaid ? This, I think,
would hardly be alleged, and yet the debt due the bank here arose
from notes on which M'Callmont was the drawer and the plain-
tiff the endorser. It strikes me, therefore, with irresistible force,
that all that was intended was merely to ascertain the amount of
the principal of the debt, leaving the interest and the principle of
the calculation to be afterwards adjusted by the parties, by the
court or a jury. It must be observed that the agreement, although
filed of record, is collateral to the judgment, and does not form
part of it. It must receive the same construction as if entirely
distinct and separate from the judgment. And this view of the
case is put beyond all doubt by the evidence which the court
thought proper to reject. That it was understood that the defend-
ant was to pay the interest as well as the principal, appears from
his letter of the 22d June 1837. It is difficult to believe that Mr
Nixon agreed to terms less favourable to himself than were offered
by the defendant six days before the confession of the judgment.
It may be remarked, that the defendant knew the claim of the
bank to debt and interest, the latter calculated in a manner most
favourable to himself. To give this agreement any other construc-
tion would do great injustice to the plaintiff. He is liable to the
bank for the whole debt and interest, whereas, according to the
opinion of the learned Judge, he can recover from the principal
debtor only the debt without interest. In other words, the princi-
pal debtor is liable for less by the whole amount of the interest
than his endorser. It requires something more unequivocal than
the language used in this agreement to induce me to believe that
the parties intended to produce any such result. From this opin-
ion it follows that the court was wrong in excluding the testimony.
True, you cannot add to, diminish, vary or contradict a written



Dec. 1843.] OF PENNSYLVANIA. 165

, ^

[Nixon v. M'Callmont]

agreement, but there is nothing to prevent the parties from ex-
plaining it. The evidence offered was in explanation, in conserv-
ance and support of the agreement, and not in contradiction to it,
and for this reason we think it was clearly admissible.

Judgment reversed, and a venire de novo awarded.



Bond against Aitkin.

A partner may bind his copartner by a contract under seal in the name and for
the use of the firm in the course of its business, provided the copartner assents to
the contract previously to its execution, or afterwards ratifies and adopts it ; and
this assent or adoption may be by parol.

The bond of one partner taken at the time money is loaned to the firm, and as
the consideration for such loan, is an extinguishment of the debt, and not a col-
lateral security.

ERROR to the Common Pleas of Delaware county.

This was an action of debt brought by Charles Bond against
John Aitkin and James Aitkin, trading under the firm of John and
James Aitkin, on the following note:

Six months after date we promise to pay to Charles Bond or
order four hundred dollars, with five per cent, interest, without
defalcation, for value received. Witness our hands and seals, this
1st day of October 1836.

JNO. & JAS. AITKIN. [L. s.]

The plaintiffs declared in one count against the defendants as
partners in a sealed instrument alleged to have been executed by
them, and in another against them as partners for money lent.
James Aitkin pleaded payment with leave, &c. and non estfactum
to the first count. Judgment by default was entered against
John.

The plaintiff called a witness, who testified that he called on
James Aitkin, and presented to him the note in suit for payment.
Witness asked him if he had signed it. He replied that he had
not, that John Ijad signed it ; that he did not know it at the time,
but if he had, he would have been perfectly satisfied ; the money
was got for the firm and went into the firm. Witness then asked
him for his individual note, which he refused, saying he preferred
it should be sued out as a partnership claim, that the neighbours
might know it was not his fault. He said he could not pay the
amount of the note at that time, but if he could make collections,
it should be paid by the 1st October: he had left his brother to
settle the books and thought he had paid it. Witness told him he
thought he would have to pay the note, when he replied he thought



166 SUPREME COURT [Philadelphia

[Bond v. Aitkin.]

the note as good as if he gave his individual note. He admitted
that he and John had been partners.

Another witness proved that the body of the note and signature
were in the handwriting of John Aitkin. That the defendants
were in partnership for several years, John being the active part-
ner. The partnership was dissolved about the year 1839. On the
dissolution the property remained with John, who was to pay the
debts of the firm.

BELL (President) charged the jury as follows:

The plaintiff declares in two counts, one on a bill single alleged
to be executed by John and James Aitkin, dated October 1st 1836,
to secure the payment of $400. ' To this the defendant James Ait-
kin pleads non est faclum; and this plea raises the question whe-
ther the obligation is in truth the deed of John and James, as the
plaintiff argues. It appears the bill obligatory was signed by
John alone, and although he used the name of his partner as one
of a firm, it is not binding on James ; for, generally speaking, one
partner cannot bind another by specialty or instrument under
seal, sealed instruments not being such as are used in transacting
partnership affairs. The plaintiff cannot, therefore, recover on his
first count, for he has failed to prove the bill single declared on is
the deed of the defendants.

But the plaintiff, in a second count, declares against John and
James Aitkin, as partners, for money loaned to them. On the
evidence, the jury can entertain little or no doubt that the money
sought to be recovered was borrowed from the plaintiff on the
partnership account and applied to partnership purposes, and so
became the joint debt of both the partners, though actually bor-
rowed but by one of them. Prima facie, therefore, both would be
liable in this action. But in answer to this statement of the plain-
tiff's claim, the defendants set up the bill single given in evidence by
the plaintiff under his first count, as a bar to his recovery on the
second. This bill single must be taken as executed by John Aitkin
alone; for though signed in the name of the firm, it is good against
him, and him alone. But it is the undoubted rule in Pennsylvania,
that if the creditor of a firm accept the obligation of one of the
partners for the firm debt, the original claim is merged and extin-
guished in the new security, and the creditor cannot afterwards
have recourse to the first liability, as is attempted'here.

But it is shown that James Aitkin promised to pay this debt
subsequently to the execution of the bill single, and if this were
an action against him alone, I incline to the opinion that the
plaintiff might recover on this promise, as based on a subsequent
consideration. But this is an action against two, John and James ;
and before the plaintiff can recover, he must show a joint liability
on the part of the defendants to answer. In this he has failed. I
am, therefore, of opinion the plaintiff is not entitled to recover in
this action, and your verdict ought to be for the defendants.



Dec. 1843.] OF PENNSYLVANIA.

[Bond v. Aitkin.]

The plaintiff excepted to the charge, and assigned the following
errors :

1. The court erred in charging that the bill single executed by
John Aitkin was an extinguishment of the joint debt of both de-
fendants.

2. In charging that the plaintiff could not recover upon the
second count of the declaration.

3. In charging that the plaintiff could not recover upon James
Aitkin's promise to pay.

4. In charging that there was no joint liability.

5. In charging that the bill single was void as to James Aitkin.

Edwards and B. Tilghman, for plaintiff in error. A partner
may be bound by a deed executed on behalf of the firm by his co-
partner, provided there be either a previous authority or a subse-
quent adoption of the act. 3 Kent 47; Cady v. Shepherd, (11
Pick. 405); Taylor v. Coryell, (12 Serg. fy Rawle 249); Darst v.
Roth, (4 Wash. C. C. 471) ; Story on Part. 180; and such previous
authority or subsequent ratification need not be under seal, nor in
writing, nor specially communicated for the specific purpose; but
may be inferred from the partnership, and from the subsequent
conduct of the copartner implying an assent to the act. Gram v.
Seton, (1 Hall 262).

But the note is not a bar to the plaintiff's recovery on the count
for money lent. 4 B. # C. 968 ; 1 Sound. PL 403 ; Emly v. Lye,
(15 East 6). The separate note of one partner is not an extin-
guishment or satisfaction of their joint debt, unless there was a
special agreement to that effect, or such was the intention of the
parties ; and this is a question for the jury. Estate of Davis 6f De-
sauque, (5 Whart. 538) ; Sheehy v. Mandeville, (6 Crunch 264) ;
Mason v. Wickersham, (4 Watts <$* Serg. 100) ; Bedford v. Deakin,
(2 B. 4- Aid. 210). They also referred to Day v. Leal, (14 Johns.
404) ; Wallace v. Fairman, (4 Watts 379) ; Weakly v. Bell, (9 Watts
280) ; Jones v. Johnson, (3 Watts fy Serg. 279).

Lewis, contra. An instrument under seal executed by one
partner in the name of the firm, will not bind his copartner, unless
there be an express authority by deed, or he be present and assent
to the sealing and delivery by the other as the act of the firm.
Harrison v. Jackson, (7 T. R. 207) ; Hart v. Withers, (1 P. R. 285) ;
Overton v. Tozer, (7 Watts 331); Gerard v. Basse, (1 Doll. 119);
Cash v. Tozer, (1 Watts fy Serg. 519) ; Bitzer v. Shunk, (1 Watts fy
Serg. 341) ; U. States v. Jlstley, (3 Wash. C. C. 508) : and no subse-
quent acknowledgment or declaration after the dissolution of the
partnership will make it the act of the firm. Searight v. Craighead,
(1 P. R. 135) ; Deckert v. Filbert, (3 Watts $ Serg. 454.)

The opinion of the Court was delivered by

SERGEANT, J. The question arising in this case has undergone



168 SUPREME COURT [Philadelphia

[Bond v. Aitkin.]

a thorough discussion in the two late cases of Gram v. Seton, (1
Hall 262), and Cady v. Shepherd, (11 Pick. 400), where ail the
authorities are examined, and the principle is settled that a part-
ner may bind his copartner by a contract under seal, in the name
and for the use of the firm, in the course of the partnership busi-
ness, provided the copartner assents to the contract previously to
its execution, or afterwards ratifies and adopts it ; and this assent
or adoption may be by parol. And we are satisfied that the rule
is founded on principles of justice and policy, and supported by
the general tenor of the adjudged cases in this country and in
England. The only question in the present case is, whether there
is any evidence to go to the jury to show that James Aitkin as-
sented to the giving of the sealed bill in the name of the firm,
before or at the time of its execution, or afterwards ratified it ;
and we think there is. The admissions made by him in the con-
versation with Carter, if believed, in connection with the fact that
the money was got for the firm and went to its use, are evidence
to go to the jury. He said that though he did not know of it at the
time it was given, yet, if he had, he would have been perfectly
satisfied ; if he could make collections, he would pay it in October.
He repeatedly desired it should be sued as a partnership claim,
and declared the note was as good as if he gave his individual
note. This and the whole tenor of the conversation tend strongly
to the inference that he had authorized the giving of it ; and we
think the evidence ought to have been left to the jury to say whe-



Online LibraryPennsylvania. Supreme CourtReports of cases adjudged in the Supreme court of Pennsylvania [May term 1841 - May term 1845] (Volume 6) → online text (page 19 of 69)