66 N.Y. 206 | NY | 1876
[EDITORS' NOTE: THIS PAGE CONTAINS HEADNOTES. HEADNOTES ARE NOT AN OFFICIAL PRODUCT OF THE COURT, THEREFORE THEY ARE NOT DISPLAYED.] *208 It is claimed by the defendants that the contract sued on is void under the statute of frauds, as it was not to be performed within a year and was not in writing. A contract, valid in form, is set out in the complaint, and it does not there appear that it was not in writing. It was not necessary to allege that it was in writing. For the purposes of the complaint that will be presumed. If the contract alleged in the complaint had been denied, or the statute of frauds had been set up as a defence, then it would have been necessary upon the trial to prove that the contract was in writing, if it was one which the statute required to be in writing. (Moak's Van Santford's Pl., 203, and cases cited.) There is no denial of the contract in the answer, and no averment that it was void *210 because not in writing. The same contract, valid in form, is set up in the answer, and there it is averred that the amount agreed to be paid to the plaintiff by such valid contract was upon the "express condition that the plaintiff should execute and deliver to these defendants an instrument in writing wherein such exclusive right to such invention should be given and granted to these defendants," and that the plaintiff had refused to deliver the instrument in writing. It is not averred that the condition was that the contract was to be reduced to writing, but that a separate instrument, not embracing all the terms of the contract, but granting the exclusive right to use the invention, should be executed and delivered to the defendants. This averment is not inconsistent with the existence of a contract, in writing, embracing all the terms of the contract; and, if merely inconsistent, the contract alleged in the complaint not being denied, it would not answer the purposes of a general or specific denial of the contract alleged. (Code, §§ 149, 168; Wood v.Whiting, 21 Barb., 190; West v. American Exchange Bk., 44 id., 175.) Hence, it may be assumed that the statute of frauds furnishes no defence to the action in its present condition.
It is also claimed, on the part of the defendants, that this contract is required to be in writing by section 11 of the patent law, passed by Congress July 4, 1836. This defence is not set up in the answer, and, for reasons above stated, the contract must be assumed to have been in writing and the law thus complied with.
It must not be inferred, from any thing here said, that we are of opinion that either the statute of frauds or the act of congress required this contract to be in writing. It will be time enough to determine whether they do or not when the questions are properly presented.
It is claimed by the defendants that the agreement is void for want of a consideration, in that the patent was invalid. This defence is very imperfectly set up in the answer, but the pleader evidently intended to set it up, and, therefore, we will assume that it is sufficiently pleaded. It is sufficiently *211
established by the judgment in the United States Circuit Court, in an action in which these defendants were plaintiffs, and this plaintiff and others defendants. That judgment established the fact that this patent was wholly void, invalid and of no effect, for the reason that Elizabeth Hawks, the patentee, was not the original and first inventor of the improvement patented. That judgment was not set up in the answer, but the invalidity of the patent was alleged, and the judgment was, therefore, properly received in evidence to prove the allegation, assuming that the allegation itself was material. (Bouchaud v. Dias, 3 Den., 238; Castle v. Noyes,
The plaintiff and defendants were tenants in common of the patent, all believing it to be valid. Each had the right to manufacture and to license others to manufacture under it. (Clum v. Brewer, 2 Curtis, 506.) The defendants desired the exclusive right to use the invention, and hence made this agreement with the plaintiff. Under it, they actually enjoyed the exclusive right which they sought, and the plaintiff gave up all right to manufacture or to license others to manufacture. There was no fraud, and the defendants got all they bargained for. During the time mentioned in the complaint, they enjoyed all they could have had if the patent had been valid. Under such circumstances, there was abundant consideration to uphold the agreement, whether the patent was valid or invalid.
The parties held a patent, which was respected as valid by everybody. They enjoyed a monopoly of the invention. They could manufacture the patented article without competition; and the possession of the patent, apparently valid, enabled them to license others, for a consideration, to use *212
it. In consideration of defendants' promise, the plaintiff gave up all the advantage he thus had, and the defendants, by virtue of the agreement, enjoyed the exclusive monopoly. Here there was injury to one party, and benefit to the other, either of which is sufficient to furnish a consideration for a promise. (Miller v.Drake, 1 Cai., 45; Converse v. Kellogg, 7 Barb., 590;Freeman v. Freeman,
There are several English cases holding that the invalidity of the patent is no defence to such an action as this to recover license fees for the term the patent was actually used under the license. (Taylor v. Hare, 1 N. Rep., 260; Lawes v.Purser, 88 Eng. C.L.R., 929; Noton v. Brooks, 7 Hurlst. N., 499; Baird v. Neilson, 8 Cl. Fin., 726; Crosley v.Dixon, 10 H. Lords Cases, 293; Chanter v. Dewhurst, 12 M. W., 823; Lawes v. Purser, 38 Law Eq. R., 48; see also Hindmarch on Patents, 245.) To the same effect is Bartlett v.Holbrook (1 Gray, 114), and also Marsh v. Dodge (4 Kern., 279). The case of Saxton v. Dodge (57 Barb., 84) has some features like this case, but many more unlike it. There the licensees of the patent did not get all they bargained for, and they were induced to enter into the contract by fraud.
It is the settled law of this and several other States that the invalidity of the patent is a defence to an action for the purchase-price of the same, on the ground of a failure of the consideration. (Cross v. Huntly, 13 Wend., 385; Head v.Stevens, 19 id., 411; McDougall v. Fogg, 2 Bosw., 387;Dunbar v. Marden,
The plaintiff's claim was therefore undefended, and the court erred in ordering judgment for defendants upon their counter-claim. It is true that the counter-claim was not sufficiently denied by the reply, and judgment might have been ordered for the plaintiff for the balance of his claim, after deducting the amount of the counter-claim; but a new trial should be granted, and it is hoped that the very *214 imperfect pleadings will be so reformed before another trial as to present truly the precise issues which the parties desire to try.
Judgment should be reversed and new trial granted, costs to abide event.
All concur. FOLGER, J., absent.
Judgment reversed.