Fretz v. Stover - 89 U.S. 198 (1874)
U.S. Supreme Court
Fretz v. Stover, 89 U.S. 22 Wall. 198 198 (1874)
Fretz v. Stover
89 U.S. (22 Wall.) 198
1. The point cannot be first made in this Court that no replication has been made to an answer in chancery, and therefore that the answer is to be taken as conclusively true in all points. If such a point is meant to be insisted on here, it should have been made in the court below.
2. New defenses, i.e., defenses not made in an answer to the original bill, cannot be first set up in an answer to a bill of revivor. Such bill puts in issue nothing but the character of the new party brought in.
3. After the late rebellion broke out, debtors in the rebellious states had no right to pay to the agents or trustees of their creditors in the loyal states debts due to these last in any currency other than legal currency of the United States. Payment in Confederate notes or in Virginia bank notes (security for whose payment was Confederate bonds, and which notes like the bonds themselves never, after the rebellion broke out, were safe, and before it closed had become worthless) held to have been no payment, and the debtor charged de novo.
For several years prior to February 25, 1861, a litigation had been waged by Fretz and wife, residents of Pennsylvania, against Stover, a resident of Fauquier County, Virginia, a certain Chilton, a lawyer in embarrassed circumstances, and resident in the same county, being the counsel of the former. The suit was for property claimed by the wife. On the said 25th of February, 1861, a compromise
was effected between the parties, and it was agreed that Stover should give his bond to Fretz and wife, secured by a deed of trust to Chilton, as trustee, of a valuable farm, specified, for $2,366, payable on or before the 1st of March, 1863. Fretz and his wife now returned to their home in Pennsylvania, leaving their attorney, Chilton, to see that the compromise was properly carried out, and that all details necessary for its completion were attended to. Chilton did thus accomplish matters, and Stover having, on the 8th of April, 1861, executed his bond, payable on or before March 1, 1863, to Fretz and his wife, and transferred to Chilton by deed of trust for Fretz and his wife the farm to secure it, both instruments were delivered in form to Chilton. Of all this Fretz was informed. At the time when the compromise was made. the country was in a disturbed condition with the Southern issues, but intercourse between all parts of it was still common, and as yet no war existed. On the 12th of April, 1861, Sumter was fired on by rebels, and civil war became flagrant. All communication ceased between Pennsylvania and that part of Virginia in which Chilton and Stover lived.
In 1864, intercourse being restored between Fauquier County, Virginia, and Pennsylvania, Chilton wrote Fretz saying "that the papers were all safe, and that he would keep them safe, as he could collect nothing but Confederate money." In the autumn of 1865, Fretz went to Fauquier County, where he saw Chilton, and Chilton then told him that he had received nothing on account of the bond; showed him a letter from Stover offering to pay it in Confederate money, which money Chilton said that he had not taken because it would have been of little use to him, Fretz. In 1866 -- that is to say after the war was ended -- Fretz learned accidentally that the bond had been paid in December, 1862, not wholly in notes of the Confederate states, but partly in them and partly in notes of Virginia banks; the security for the payment of which latter was bonds of the Confederacy, and the bonds and all the notes, of course, becoming worthless alike with the fall of the Confederacy itself.
Chilton was alive at this time, but soon after (1867) died insolvent, and Fretz now (August 9, 1869) filed a bill in the court below (his wife not being a party) against Stover to set up and have enforced the deed of trust, the ground of the bill being that Chilton had no authority to receive payment in paper such as he did receive it in, nor Stover the right to make it. The bill set forth the general history of the transaction, alleged
"that the said bond and the deed of trust securing the sum of money specified in the bond were left with the said Chilton as the attorney at law of the complainant, the deed of trust for record and the bond for collection at its maturity."
It charged actual fraud between Chilton and Stover in this, that Stover, taking advantage of Chilton's great pecuniary necessities, induced him to receive the Confederate and Virginia paper money at par in payment and discharge of the bond.
After the filing of the bill, Mrs. Fretz, the wife, was by consent of counsel made a party to it.
Stover filed his answer, admitting the settlement and execution of the bond and deed of trust, and the payment in Virginia bank notes and Confederate Treasury notes as charged, but denied that these payments were the result of an unlawful and fraudulent combination between the respondent and Chilton. He insisted, however, that they were in law a full discharge and satisfaction of the debt and trust deed, but if this were not so, that to the extent of the compensation due by Fretz to Chilton for professional services, he should not be compelled to pay a second time.
After this answer was filed, the deposition of Fretz, the husband, was taken by the complainants, which was the only evidence in the cause. Fretz swore that Chilton had no authority over the bond and deed of trust, except to take charge of them and keep them safely, and to have the deed recorded, all which he promised to do, and that he, Fretz, had never given any authority to Chilton to receive payment in any kind of currency; that the subject of payment of the instruments had never been spoken of between the parties.
Fretz further testified that at the time of Chilton's death, Chilton was indebted to him on another account, over and above any fees due for professional services, and that these had been paid.
Subsequently Stover died, and a bill of revivor was filed to make his brother, who was his sole devisee and legatee, as also the executor of his will, a party defendant. The brother appeared and answered, admitting the character imputed to him by this bill but setting up new defenses founded on alleged ratification of Chilton's acts by silence and acquiescence after they came to the complainant's knowledge -- defenses not made in the answer of Stover to the original bill. The record did not show any replication made either to the original answer or to the answer of the executor.
On the hearing, the bill was dismissed, and this appeal was brought to revise that decree.