Parsons v. Woodward

| N.J. | Jul 15, 1849

Carpenter, J.,

delivered the opinion of the court.

The case, as presented by the pleadings, is in substance this : The parties, 19th of January, 1839, entered into this covenant, that the defendant, for four thousand morus multicaulis trees, on that day sold to him by the plaintiff, to be delivered on the ground where the said trees should grow, in the fall months of the same year, and to be of a stipulated character, would pay the plaintiff twelve and a half cents for each tree so as aforesaid sold and described, when they should be delivered. On the 18th of March, 1839, the plaintiff, by endorsement on the covenant, assigned his interest in the contract to one John Hitchens ; and on the 20th of March, 1839, the plaintiff made a general assignment, under the statute, for the benefit of his creditors.

Objections have been urged to the third, fourth, fifth, and sixth pleas, upon grounds specially assigned for causes of -demurrer ; but it will scarcely be necessary to advert to technical grounds relating to the form of the pleas, if the defence attempted to be set up is insufficient and the pleas are entirely defective in substance. Now the defence set- up is, that the trees held ready for delivery, and whereof notice was given to the defendant, were the trees not of the plaintiff, but of one John Hitchens. It is very true that it has been held, that in a strict contract of sale to pass the title the articles must belong to the grantor, and have an existence actual or potential at the time of making the contract, and that the grant is void if otherwise, unless ratified after the property has been acquired. Lunn v. Thornton, 1 C. B. 379; Jones v. Richardson, 10 Metc. 481; 9 Boston Law Reporter 344 S. C. See Mitchel v. Winslow, 2 Story Rep. 638; 2 Kent 468; lb. 504; Bell on the Contract of Sale 16, 26, &c., (Law Lib. ed., 1845).

The two cases just cited, in which the older authorities are collected, have placed the question in a clear light. But an agreement in respect of something to be collected and furnished, though not strictly a contract of sale, because the article is not specified or identified and capable of delivery, yet it may be good as a special or executory agreement. This is not a contract of sale, but a special executory agreement under seal, in which the plaintiff covenanted to deliver a specified quantity of a particular article at a future time. The defendant has not, upon oyer, set out the covenant in his plea. There is nothing in the covenant, as stated in the declaration, to show that the plaintiff undertook to deliver any specific trees, or the produce of any specific trees, then belonging to him and growing in any particular field. He agreed to deliver (by words applicable, it is true, to a present sale, but which must be understood according to the subject matter of' the contract,) four thousand moras multicaulis trees, not then planted or even in existence, to be delivered at a specified time on the ground where they should be subsequently planted and grown. There is nothing that debarred him from procuring them to be raised by John Hitchens, or any one else, to whom he might delegate the duty and assign the profits. The terms of the agreement, as shown in the declaration, that the trees should be delivered in the field where they should be subsequently grown, and of course planted, seem to be conclusive that there was then no present sale, but only an executory agreement to deliver trees of a particular character and description. If specific trees then in the field had been in the contemplation of the parties, the liability of tiie plaintiff to deliver the trees would have depended upon his success in cultivating the trees, and upon their growth into the requisite quality. Boyd v. Siffkin, 2 Camp. 326. And of course the liability of the defendant would have depended upon the ability of the plaintiff to deliver those trees in the state so required by the covenant. But nothing is seen in the covenant which requires or will admit of this construction. On the contrary the plaintiff, at all events, was then to deliver in the field (not any specified field, but wherever the trees should be grown,) trees of the requisite character; and if he did tender such trees, no matter by whom raised, the defendant was bound to accept and pay for them.

The third plea sets up, that at the usual time of planting, in the spring next after the making of the covenant, the plaintiff had no multicaulis trees to plant; that he did not plant or raise any that season, and in the fall had none to deliver of his own property, but proposed to deliver the trees of one John Hitchens. If this plea raises any matter of defence, it is argumentatively the same matter set up by the second plea, that he had not any of the requisite character ready to be delivered in conformity with the agreement. While it seems faulty as argumentative, yet, if we are right in the construction of the covenant, it is defective in substance, presenting no substantial defence, as with the assent of Hitchens, his trees, if of the requisite character, rightly tendered, would be a full compliance with the stipulation on the part of the plaintiff.

. The fourth plea proceeds upon the same idea, of the sale of some specific trees. It is therefore equally defective, and on the same grounds with the plea already disposed of.

The fifth plea sets up want of notice that the trees were ready to be delivered. Properly pleaded, undoubtedly, this would be a good defence. But the plea is based upon the same idea, of a sale of some specific trees. It avers that the trees mentioned in the declaration, and therein obliged to have grown upon certain lots, &c., were not the property of the plaintiff, but of one John Hitchens, and protesting that the defendant was not bound to receive the said trees; then it avers that he had no notice. Considered as a plea simply, that no notice was given of the plaintiff’s readiness to deliver, it is faulty for the reason specially assigned, of an improper conclusion. It is a more negative response to an .affirmative allegation in the declaration. It is also faulty because argumentative and attempting to put in issue matter not alleged, nor necessary to be alleged, in the declaration.

The sixth plea is also defective, for the principal reason already given. Upon this contract it was immaterial whether, at the time of making it, the plaintiff had or had not multicaulis trees. His covenant was to deliver trees of a certain description at a subsequent time.

The replication to the seventh plea presents the question, whether the contract was one which could be assigned, and the beneficial interest pass under such assignment to Hitchens ; so that he could fulfil the terms of the contract, and maintain an action for its breach against the opposite party, in the name of the plaintiff. If it can so pass, by priority in time, undoubtedly, it will be protected against the subsequent general assignment.

It was a well known rule of the common law, that a mere thing in action was not assignable at law, with the exception of negotiable instruments, unless by statute • such is still the general rule, at least without the assent of the debtor. But it is otherwise in equity, where one party may purchase by assignment the whole interest of another in a contract, or security or other property, even in litigation, provided there be nothing which savors of maintenance. Thus an equitable interest under a contract for the purchase of real estate may be the subject of sale, the original holder becoming in such case a trustee for the sub-purchaser to whom such sale is made; and he will be compelled, under proper indemnity, to permit his name to be used in any proceedings necessary for obtaining the benefit of the contract. Even unearned freight h.as been held the subject of equitable agreement or assignment, which will be protected at law as well as in equity. Leslie v. Guthrie, 1 Bing. N. Cases 699. See 2 Story Eq. Jur. § 1050, 1055, and Cases.

The doctrine of equitable assignments, having its origin in courts of equity, has been followed to a great extent in courts of law, though the mode in which equitable rights are there protected or enforced is limited by technical forms and arbitrary rules. So far have courts gone that it has even been said of the ancient rule, that choses in action are not assignable, that it only remains to give form to some legal proceedings. One form in which the rule still remains is, that when a debt or other chose in action is assigned, ordinarily it is necessary to sue at law in the name of the original creditor, the person to whom transferred being treated rather as an attorney than an assignee; though his rights will be recognized and protected, to some extent at least, even in a court of law. Sloan v. Somers, 2 Green 510; Winch v. Keeley, 1 T. R. 619 ; Welsh v. Mandeville, 5 Wheat. 277. It was said by Justice Story, who delivered the opinion of the court in the last case, that courts of law, following in this respect the rules of equity, now notice assignments of choses in action, and exert themselves to afford them any support and protection not inconsistent with the established principles and modes of proceeding which govern tribunals according to the course of the common law.

The authorities referred to in the progress of this opinion clearly show that beneficial contracts are assignable in equity, in which case, when bona fide and for a valuable consideration, the assignor becomes a trustee for the assignee, who is authorized to use the name of the former to enforce the interest which he has acquired. The necessary steps may be taken by the assignee, as the attorney or agent of the assignor, though for his own benefit; and such equitable assignment previous to bankruptcy or insolvency, when necessary may be pleaded, many instances of which might be cited. See Parnham v. Hurst, 8 M. & W. 743, and Winch v. Keeley, already cited. When the plea, as here, sets up the insolvency of the assignor, the proper answer in the replication is, that the debt or contract though in the name of the plaintiff, yet in substance belongs to a third party, and therefore did not pass under the assignment for the benefit of the creditors; if not, it is still in the plaintiff, for the benefit of such third person, and the action can be maintained.

The pleas demurred to are overruled, and the replication to the seventh piea sustained.

Judgment for the plaintiff.