Exchange Bank v. Rich, 107 Mass. 37

Exchange Bank v. Rich

107 Mass. 37 | Mass. | 1871

Gbay, J.

It has already been decided in this case, upon proof of substantially the same facts which are now agreed by the parties, that the plaintiffs could not sue the defendants as acceptor’s of the draft; because their promise to the drawer to accept it, hay - ing been made after the draft had been negotiated to the plaintiffs, did not amount to an acceptance; and the memorandum at the foot of the draft, that it was drawn against twelve bales of cotton, could have no more effect to charge the defendants as acceptors than the mere signature of the drawer, which of itself always imports a promise that he will have funds in the hands of the drawee to meet the draft. 98 Mass. 288.

The defendants’ promise to the drawer to accept the draft was a mere chose in action, not negotiable, and upon which no one but he to whom it was made could maintain an action. Worcester Bank v. Wells, 8 Met. 107. Luff v. Pope, 5 Hill, 413, and 7 Hill, 577.

The general rule of law is, that a person who is not a party to a simple contract, and from whom no consideration moves, cannot sue on the contract, and consequently that a promise made by one person to another, for the benefit of a third person who is a stranger to the consideration, will not support an action by the latter. And the recent decisions in this Commonwealth and in England have tended to uphold the rule and to narrow the exceptions to it.

The unguarded expressions of Chief Justice Shaw in Carnegie v. Morrison, 2 Met. 381, and Mr. Justice Bigelow in Brewer v. Dyer, 7 Cush. 337, to the contrary, on which the learned counsel for the plaintiffs relied at the argument, were afterwards, and while those two distinguished judges continued to hold seats upon this bench, qualified, the limits of the doctrine defined, and a disinclination repeatedly expressed to admit new exceptions to the general rule, in unanimous judgments of the court, drawn up by Mr. Justice Metcalf, and marked by his characteristic legal learning and cautious precision of statement. Mellen v. Whipple, 1 Gray, 317. Millard v. Baldwin, 3 Gray, 484. Field v. Crawford, 6 Gray, 116. Dow v. Clark, 7 Gray, 198. Those judgments have since been treated as settling che law of Massachusetts *42upon this subject. Colburn v. Phillips, 18 Gray, 64. Flint v Pierce, 99 Mass. 68.

The first and principal exception, stated by Mr. Justice Met-calf, to the general rule, consists of those cases in which the defendant has in his hands money which in equity and good conscience belongs to the plaintiff,- as where one person receives from another money or property as a fund from which certain creditors of the depositor are to be paid, and promises, either expressly, or by implication from his acceptance of the money or property without objection to the terms on which it is delivered to him, to pay such creditors. That class of cases, as was pointed out in 1 Gray, 322, includes Carnegie v. Morrison and most of the earlier cases in this Commonwealth; as well as the later cases of Frost v. Cage, 1 Allen, 262, and Putnam v. Field, 103 Mass. 556.

The only illustration, which the decisions of this court afford, of Mr. Justice Metcalf’s second class of exceptions, is Felton v. Dickinson, 10 Mass. 287, in which it was held, in accordance with a number of early English authorities, and hardly argued against, that a son might sue upon a promise made for his benefit to his father. Those cases, with the proposition on which they have sometimes been supposed to rest, that, by reason of the near relation between parent and child, the latter might be thought to have an interest in the consideration and the contract, and the former to have entered into the contract as his agent, are not now law in England. Tweddle v. Atkinson, 1 B. & S. 393. Addison on Con. (6th ed.) 1040. Dicey on Parties, 84. And this case does not require us to consider whether they ought still to be followed here.

The third exception, admitted by Mr. Justice Metcalf, is the case of Brewer v. Dyer, 7 Cush. 337, in which the defendant made a written promise to the lessee of a shop to take his lease (which was under seal) and pay the rent to the lessor according to its terms, entered' into possession of the shop with the lessor’s knowledge, paid him the rent quarterly for a year, and then before the expiration of the lease left the shop, and was held liable to an action by the lessor for the rent subsequently accruing. That case may perhaps be supported on the ground that *43such payment and receipt of the rent after the agreement between the defendant and the lessee warranted the inference of a direct promise by the defendant to the lessor to pay the rent to him for the residue of the term. See McFarlan v. Watson, 3 Comst. 286. It certainly cannot be reconciled with the later authorities, without limiting it to its own special circumstances, and affords no safe guide in the decision of the present case.

The plaintiffs are then obliged to fall back upon the first exception to the general rule. But they fail to bring their case within that exception, or within any of the authorities to which they have referred us.

In Carnegie v. Morrison, 2 Met. 381, the defendants, having funds in cash or credit of the plaintiffs’ debtor, gave him a letter of credit, which was shown to the plaintiffs, and on the faith of which they drew the bill, for the amount of which they sued the defendants; and the drawing of that bill, whereby they made themselves liable to the drawee thereof, was a consideration moving from them. In Lilly v. Hays, 5 Ad. & El. 548; S. C. 1 Nev. & Per. 26 ; the defendant, as the jury found, had authorized the plaintiff to be told that the defendant had received the money to his use, and thus promised the plaintiff to pay it to him. So in Walker v. Bostron, 9 M. & W. 411, the defendant had promised the plaintiff to pay the sum in question. And the rule established by the modern cases in England, as laid down in the text books cited for the plaintiffs, does not permit the person, for whose benefit a promise is made to another person from whom the only consideration moves, to maintain an action against the promisor, unless either the latter has also made an express promise to the plaintiff, or the promisee acted as the plaintiff’s agent merely. Met. Con. 209. Addison on Con. (6th ed.) 630,1041. Chit. Con. (8th ed.) 53. Where the promisee is in fact acting as the agent of a third person, although that is unknown to the promisor, the principal is the real party to the contract, and may therefore sue in his own name on the promise made to his agent. Sims v. Bond, 5 B. & Ad. 389; S. C. 2 Nev. & Man. 608. Huntington v. Knox, 7 Cush. 371. Barry v. Page, 10 Gray, 398. Hunter v. Giddings, 97 Mass. 41. Ford v. Williams, 21 How. 287

*44In the case at bar, the plaintiffs had acquired no title in the cotton against which the draft was drawn. The bill of lading was not attached to the draft, or made payable to the holder thereof, or delivered to the plaintiffs. The case is thus distinguished from Allen v. Williams, 12 Pick. 297, and Michigan State Bank v. Gardner, 15 Gray, 362, cited at the argument. The cotton was not of sufficient value to pay the draft, and the balance of account between the defendants and the drawer, at the time of their receipt and sale of the cotton, and ever since, was in favor of the defendants. There is no ground therefore for implying a promise from the defendants to the plaintiffs to pay to them either the amount of the draft or the proceeds of the cotton. Tiernan v. Jackson, 5 Pet. 580. Cowperthwaite v. Sheffield, 1 Sandf. 416, and 3 Comst. 243. Winter v. Drury, 1 Selden, 525. Yates v. Bell, 3 B. & Aid. 643. The plaintiffs did not take the draft, or make advances, upon the faith of any promise of the defendants, or of any actual receipt by them of the cotton or the bill of lading, but solely upon the faith of the drawer’s signature and implied promise that the defendants should have funds to meet the draft. The whole consideration for the defendants’ promise moved from the drawer and not from the plaintiffs. And the defendants made no promise to the plaintiffs. Their only promise to accept the draft was made to Hill, the drawer, after the draft had been negotiated to the plaintiffs; and there is no proof that the defendants authorized that promise to be shown to the plaintiffs, or that Hill, to whom that promise was made, was an agent of the plaintiffs. His relation to them was that of drawer and payee, not of agent and principal. To infer, as suggested in behalf of the plaintiffs, that he was their agent in receiving the defendants’ promise, so that they might sue thereon in their own name, would be unsupported by any facts in the case, and would be an evasion of the rules of law, which will not allow any person, who took the draft before that promise was made, to maintain an action upon that promise, either as an acceptance or a promise to accept.

■ Judgment for the defendants.