15 Wend. 412 | N.Y. Sup. Ct. | 1836
By the Court,
By the act incorporating the Utica and Schenectady Rail Road Company, the sum of Jive dollars on each share of the stock subscribed for, was required to be paid at the time of making the subscription ; and in case of a subscription to more than the amount of the stock authorized to be created, it was the duty. of the commissioners named in the statute to apportion the stock among the subscribers in such manner as should be deemed most advantageous to the interests of the corporation. Laws of 1833, page 462, <§>45. The question presented in the case is, whether the contract offered to be proved by the defendant, and which was rejected by the circuit judge on the trial, was made in violation of any of the provisions, or of the spirit and policy of the statute incorporating the Utica and Schenectady Rail Road Company. If it was so made, I am of opinion the plaintiff cannot recover. 5 Johns. R. 334. 6 Cowen, 431. I assume, that in the offers made, the defendant proposed to prove not only the contract which was rejected, but that the subscriptions exceeded the amount of the capital stock. The case is not very explicit upon this point, • but enough appears to warrant the inference. The money sought to be recovered was advanced to the defendant, in pursuance of the contract, and if is by virtue of its terms, either express or implied by law, that the action must be sustained, if it can be at all. This is not an attempt by the plaintiff to avail himself of a locus penitentice, to retrace his steps-, and disaffirm an unlawful agreement, while it is yet executory; the illegal purpose or' act has been executed, and the effect of a recovery is to enable him to realize a part of the fruits of it, by enforcing a performance by the defendant. The defendant was
It is supposed, however, by the counsel for the plaintiff, that if the contract is conceded to be illegal, as against the policy of the act of incorporation, still- the only consequence is to avoid it; and that the money placed in the hands of the defendant, in pursuance thereof, may be recovered back. He has referred to a number of cases, for the purpose of supporting this proposition. Utica Ins. Co. v. Kip, 8 Cowen, 20. Lacaussade v. White, 7 T. R. 535. Tassenden v. Randall, 2 Bos.&Pul.46. Taylor v. Lendy, 9 East, 49. Smith v. Blackmore,4Taunt. 474. Cotton v. Thurland, 5 T. R.405. Vischer v. Yates, 11 Johns. R. 23. 7 Price’s R. 540. Hastelon v. Jackson, 8 Barn. & Cres. 221. The case of the Utica Ins. Co. v. Kip, does not touch the question here, for the loan of the money sought to be recovered was deemed a perfectly legal transaction. The security only contravened the restraining act; and the case of Vischer v. Yates was reversed in the court for the correction of errors. 12 Johns. R. 1. None of the cases in the English courts referred to, come up to this one, and some of them are irreconcilable with each other. This proposition is laid down by Mr. Selwyn, vol. 1, 74, and is fully supported by authority, viz. where money is paid by one of two parties to an illegal contract, to the other, in a case where both parties may be considered as particepscriminis, an action cannot be maintained after the contract is executed, to recover the money back again, for in pari delicto potior est conditio defendantis. 8 T. R. 777 ; Doug. 467,697; Cowp.792. The same general position may be found in 2 Comyn on' Contracts, 108,and also in Saund. on Pl. & Ev. 677. This
If, then, the contract in this case shall be pronounced illegal, either as against the provisions or the policy of the statute, it seems to me quite clear, within the principle above stated, and as explained and illustrated by the- cases referred to, the plaintiff cannot recover. We have before said the defendant offered substantially to prove that an amount.exceeding the capital stock was subscribed, and therefore the duty devolved upon the commissioners under the fifth section of the act to distribute the stock among the subscribers, at their discretion, and in a manner most advantageous to the interest of the company. This is a very important provision. The successful- operation, and, indeed, future existence of the cor
New trial granted.