40 Barb. 235 | N.Y. Sup. Ct. | 1863
Lead Opinion
The principal question in this case is whether the agreement executed by the defendant was a mere indemnity, requiring proof of actual damage before a recovery can be had, or whether it was a covenant to pay, which was broken when the defendant failed to pay the debt upon which the Van Hoesen judgment was obtained.
It is undoubtedly true, as a general proposition, that in order to recover upon a bond or agreement to indemnity and save harmless, actual damage must be proved; the money must be paid, and it must be made to appear that some injury has accrued to the party. (Churchill v. Hunt, 3 Denio, 327. Aberdeen v. Blackmar, 6 Hill, 324.) A distinction, however, is recognized between an affirmative covenant
In the matter of Negus, (7 Wend. 499,) where a bond was intended as a bond of indemnity, but contained a covenant
In Thomas v. Allen, (1 Hill, 145,) the bond upon which the suit was brought was conditioned to pay the plaintiff a sum of money by satisfying a bond and mortgage, and to save harmless the plaintiff therefrom, &c. It was held that it was not a bond of indemnity, and that non-damnificatus cannot be pleaded where the condition is to discharge or acquit the plaintiff from such bond or other particular thing, for then the defendant must set forth affirmatively the special matter of performance. Was not the agreement in the case now considered to acquit and discharge LathrojJ from the debts ? If it was, then the rule laid down is manifestly applicable.
In Gilbert v. Wiman and others, (1 Comst. 550,) which was an action upon a bond given by a deputy sheriff to the sheriff, it was held that in contracts of indemnity, where the obligation is to perform some specific thing or to save the obligee from a charge or liability, the contract is broken when there is a failure to do the specific act, or where such charge or liability is incurred. Pratt, J. in his opinion in that case, when decided in the supreme court, lays down the rule, that “ when the instrument deviates the least from a simple contract to indemnify against damage, even where the indemnity is the sole object of the contract, and where, in consequence of the primary liability of other persons actual loss may be sustained, the decisions pf our courts, although-by no means uniform, have gradually inclined towards fixing the rule to be
By the agreement in the present case, the defendant was bound to pay all the debts of either of the firms; but no particular time of payment was specified. Ho certain time being provided for, the law required payment to be made immediately, or at least as soon as the debts were due. (Churchill v. Hunt, 3 Denio, 324, and authorities cited. See, also, Thompson v. Ketcham, 8 John. 189; Lake Ontario Co. v. Mason, 16 N. Y. Rep. 451, 464.) As the debt was not paid when the suit was commenced, the condition of the agreement was broken, and the action properly brought and maintainable. I think that the judgment against Lathrop is conclusive as to the amount of the demand and the costs. Whiting was notified of the suit, and assumed to defend it. It was his own fault, and his failure to fulfill his agreement in. connection with his defense of the suit, which made the costs. He put himself in Lathrop’s place after he had been notified, and must abide the consequences of his own act. The costs were a charge accessory to the principal demand, arising mainly from the acts of the defendant, and are justly chargeable upon him. (Kip v. Brigham, 7 John. 171.
The costs of the "supplementary proceedings rest upon a different footing. The defendant had no notice of the proceedings, nor any connection with them, and could not be made liable in this action to pay the costs. The remedy (if any) may exist in an action by Lathrop upon the covenant to indemnify and save harmless after payment by Lathrop. The defendant instituted the proceedings, and I know of no principle upon which the costs can be allowed in this action.
It is said that the agreement enured to the benefit of. Van Hoesen, and the remedy was a suit by him against the defendant, and that no recovery can therefore be had in this case. It does not so read. And may it not be urged with equal propriety, that it was for the benefit of Lathrop, as his debts were to be paid ? The agreement was to pay the debts, without designating the amount or the individuals who were creditors of the firm, and without any direct promise to pay either Lathrop or the creditors. If the language employed in the last clause is to be taken literally, it may perhajos be said that the defendant did not agree either to pay Lathrop or the creditors, as neither are named in connection with it. Although there may be a remedy against Whiting, in favor of Van Hoesen, upon the covenant to pay the debts of the firm, yet it by no means follows that Lathrop had no right to prosecute. In fact under the authorities before referred to, the defendant was liable to Lathrop, and because Van Hoesen had also a remedy, it cannot deprive Lathrop of his rights. It is perhaps questionable whether the rule authorizing an action upon a promise made for the benefit of a third party, without any consideration moving from the latter, applies to a case of this kind. With the views already expressed, I deem it unnecessary and unimportant to pursue that inquiry.
The objection made by the defendant, upon the trial, to the admission of evidence to show the service of the notice of the commencement of the suit against Lathrop by Van Hoesen,
For the reasons given, the judgment should be affirmed, and a new trial denied, upon the plaintiff consenting to deduct the costs of the supplementary proceedings; otherwise the judgment should be reversed, and a new trial should be granted, with costs to abide the event.
Gould, J. concurred.
Concurrence Opinion
concurred, but thought the costs of the supplementary proceedings were recoverable.
Gould, Peckham and Miller, Justices.]
