Cram v. Union Bank

42 Barb. 426 | N.Y. Sup. Ct. | 1863

By the Court,

James 0. Smith, J.

I think this case was properly disposed of at the circuit. It appears by the plain and unambiguous terms of the bill of sale executed by Mattison to Whaples, that the subject matter of the sale was the interest of Mattispn in the property of the firm. The sale was not of specific articles by items, but of the entire interest, of one of the partners in the partnership effects, in gross. Undoubtedly, the parties, in making their contract, took into consideration the apparent amount of goods and tools on hand, and of the indebtedness to the firm as shown by their books; and it may be assumed that an inventory was taken, as the defendants offered to show, on the trial, to which the parties referred in estimating the amount and value of the property. Even if it be further assumed that the parties supposed the inventory embraced every article belonging to the firm, still the contract was not in terms limited by the inventory; the latter is not mentioned or referred to in the bill of sale, and the parties purposely and expressly employed words of description so general and .comprehensive as to include every species and article of property of the firm, whether enumerated in the inventory or not. It was contemplated, at the time, that Whaples should take the place of Mattison, in the firm, which he did ; and it was agreed that he should pay Mattison, for his interest, the sum of $900, and should also assume his half of the debts owing by the firm. In short, as Mattison testified, Whaples took his place in the firm, “ one half interest, and one half liability." An inventory of the debts was also made, but it was not referred to in the bill of sale, and the effect of Mattison’s agreement was to-make him liable for one half of all the debts, whether inventoried or not. In these circumstances I do not think it competent for Mattison or the defendants, claiming under him, to set up as a defense to this action that a particular item of the partnership property, to wit, the claim in question against the defendant, did not pass by the bill of sale, for the reason that its existence was unknown to the parties, at the .time of the sale. In view of the fact that the parties intended that the purchaser should take the place of the vendor, in the firm, and of the broad language, which they employed, in describing not only the property conveyed, but also the liabilities assumed, I think they must be, deemed to have had in their minds the possibility, not to say the probability, that one or more items of property as well as of indebtedness may have been unknown or forgotten at the time, and to have provided by their contract for the very contingency which has arisen. If this view of the contract is correct, it follows that the claim in question passed to Whaples, as completely and effectually as did any of the property of the firm.

The transaction is analogous to a purchase of a farm by certain boundaries, containing in gross, by estimation, a certain number of acres. It is well understood that in such a case, if the transaction be bona fide, and both parties be equally under a mistake as to the quantity, but not as to the boundaries, the sale will be binding on both parties, whether the farm contains more or fewer, acres. (Story’s Eq. Jur. § 144 a. Morris Canal Co. v. Emmett, 9 Paige, 168. Stebbins v. Eddy, 4 Mason, 414.)

There are other considerations, which ought not to be overlooked. The defense interposed is of equitable cognizance. When a court of equity is asked to give relief in a case not fully remediable at law, or not remediable at all, at law, it grants it only according to its own doctrines, and upon equitable principles. By the terms of the agreement, as has been already observed, Whaples assumed Mattison’s liability in respect to all the partnership debts. There can be no doubt that by his contract he became liable to each creditor of the firm, whether the particular debt of such creditor was known or not by the parties to the contract. His liability being thus broad, it would be inequitable to limit his purchase, as proposed by the defendants.

[Monroe General Term, December 7, 1863.

Again: all that Whaples could in any event acquire by his purchase was what might remain of Maitison’s interest after payment of the partnership debts. The amount and value of the remainder were, in the nature of the case, doubtful; and, in such cases, the equity is deemed equal between the parties; and when it is so, a court of equity is generally passive, and rarely exerts an active jurisdiction. This rule applies to all cases of sale of real estate or personal estate, made in good faith, where material circumstances, affecting the value, are equally unknown to both parties. ([Story’s Eq. Jur. § 150.)

I am of opinion' that the plaintiff is entitled to judgment on the verdict.

Ordered accordingly.

Johnson, J. 0. Smith and Welles, Justices.]