5 Paige Ch. 650 | New York Court of Chancery | 1836
Before proceeding to examine the merits of this cause, it is proper to notice one or two objections that were made upon the argument, which relate to matters of form. On the part of the defendant Warner it was insisted that there was no equity in the bill which could authorize the complainant to make him a party; and that he was a mere witness. This objection is untenable, if the allegation in the bill is true, that Warner, at the time of the purchase of the notes, was the agent of the complainant to obtain a compromise of his Providence debts at an amount not exceeding fifty cents on the dollar. If such was the fact, the transfer of the notes to Johnson, for the whole nominal amount thereof, was a fraud upon the rights of the complainant;, which would have authorized him to file a bill in this court to compel the defendant Warner to indemnify him against the payment of any more of the notes than was equitably due, as between him .and Warner, at the time of the transfer of the notes to Johnson. And as the notes were transferred to" Johnson and Harris after they became due, and therefore subject to all equities which existed against such notes in the hands of Warner, the complainant had a right to join them with Warner, as defendants in the suit, for the purpose of having the account of what was due ascertained, to prevent a recovery at law for any more than was justly due. (See Baily v. Inglee, 2 Paige’s Rep. 278. Again ; it appears, from the answer of the defendant Johnson, that Warner sold and transferred the notes to him as being justly due to the extent of the full nominal amount thereof. And that he gave to Johnson no information as to the existence of the agreement of the 23d of April, Í 830, or that any equitable claim existed to prevent the recovery of the full amount of the notes, with interest. This being the fact.
The copy of the answer of Warner which was served on the complainant’s solicitor, has no jurat attached to it; and it is objected that, for this reason, it is to have no greater effect, as evidence, even where it is responsive to the bill, than if an answer on oath had been waived by the complainant, under the provision of the revised statutes on that subject. (2 R. S. 175, § 44.) This is probably a mere slip of the defendant’s solicitor," as I presume the original answer on file was duly sworn to, in the usual manner. The 40th rule makes it the duty of the complainant, if he wishes to waive an answer on oath, so as to obtain the benefit of this provision of the revised statutes, to insert .such waiver in his bill. And where he has a right to an answer on oath, and neglects to insert such a waiver in his bill, he ought not to bo permitted to take advantage of a technical objection of this kind, to deprive the defendant of the benefit of such parts of the answer as are responsive to the bill. If, from the copy served, the answer did not appear to have been properly verified, the complainant’s solicitor should have refused to receive it, or he should have returned it to the defendant’s solicitor, as soon as the mistake was discovered, and proceeded as if no answer had been put in. But by filing a replication and proceeding to a hearing upon pleadings and proofs, the irregularity of serving an answer to which no jurat was attached, was waived.
The answer of the defendant Warner is in direct collision with the testimony of W. H. Priest, one of the complainant’s witnesses, as to the fact of Warner’s having assumed to act as the agent of Reed, in compromising with his Providence creditors, previous to the purchase of these notes; and the letters of Warner, before and after the transfer of the notes of Davis, Babbitt & &o. to him, strongly corroborate the testimony of Priest, in this respect. There is some little doubt as to the
The first loiter of Warner to the complainant, after the interview testified to by Priest, is dated at Providence, on the 16th of March, 1830. 'In this letter Warner says, ecI have made some inquiry respecting your business, and think, from what I can discover, that you will find some difficulty in settling at fifty cents on the dollar, cash down. Patten says he will have seventy-five. Mr. Frost says the same. I will look about and ascertain what others will do, and will write you soon. ■ I should recommend you to settle with Mumford, if possible.” Again, upon the 88th of April, he writes to Reed,
As the notes were transferred to Johnson, after they became due, and under circumstances sufficient to put him on inquiry, as to the equities existing between the maker and the holder of the notes, Johnson cannot be permitted to bold them for any thing more than the two sums offered by Reed, in August, 1830, with interest from the 13th of that month ; which, from the casting on exhibit No. 11, appears to be the day on which that offer was made. The complainant is not wholly without fault in this business, as he should have paid the amount of the two smallest notes, and tendered sufficient upon the other to make up the $406,45 and interest, from August 13th, 1830. In that case the costs of the suits upon the two smaller notes would have been saved. He must, therefore, pay the whole amount of those two notes, and the costs of the suits thereon ; and so much of the larger note as will, with the principal and interest of the two smallest, make up the $406,45 and interest. And upon the payment of that amount, the defendants must be perpetually enjoined from proceeding in the suit upon the larger note, and the same must be deposited with the register and cancelled.
The defendants Harris and Johnson appear to have acted in good faith, and I shall not charge them with the costs of the complainant in this suit; but he is entitled to recover his costs as against the defendant Warner. As the defendants have all appeared by one solicitor, and the cause was argued by the same counsel, on the hearing, it would be improper for me, at this time, to undertake to settle their rights between themselves, although it is probable that sufficient appears upon the pleadings and proofs to enable me to make such a decree as would be equitable in that respect. I shall therefore reserve the questions which arise between the defendants themselves, and give permission to any or either of them hereafter to apply for such further directions in this respect as may be just. z