Where the complainant and respondent in a suit in chancery
entered into a mutual covenant, that, pending the suit, they would
divide the money between them in certain proportions and that if,
in the said suit, it should be decreed that these were not the
correct proportions, they would respectively pay the difference so
as to conform to the decree, and the result of said suit was a
dismissal of the complainant's bill with costs, and the respondent
brought an action of covenant against the complainant, reciting the
agreement in his declaration with an averment that, by virtue of
the decree of dismissal, he was entitled to receive a certain sum
of money, this declaration was bad.
The agreement looked to a judicial determination of the rights
of the parties in some court of law or equity, and the declaration
omits all averment that these rights had been so settled.
The decree of dismissal did not of itself prove that the
complainant owed the respondent anything. It only proved that the
respondent was not indebted to the complainant.
Nor is this defect in the declaration cured by verdict. It
cannot be presumed that evidence was given upon the trial to show
that some decree had adjusted the amount due, as claimed in the
declaration, because this would be presuming against the record,
which recites the substance of the decree. A total omission to
slate any cause of action is a defect which a verdict will not
cure.
The averment of the
virtute cujus is insufficient
either as matter of law or fact -- as law because no such legal
consequence could follow from the premises and as fact because the
averment was in contradiction to the record itself.
There was no bill of exceptions in the case, but the whole
record was brought up upon the allegation of a fatal defect in it,
because no cause of action was shown by the plaintiff below in his
declaration.
Hobson, a citizen of Alabama, brought an action of covenant
against McDonald, as the administrator of McArthur. As the whole
case depended upon a very nice point of pleading, the Reporter has
thought it proper to insert the whole of the declaration, which was
as follows:
"William McDonald, administrator of all and singular the goods
&c., of Duncan McArthur, deceased (which said William is, and
the said Duncan was, at the time of his death, a citizen and
resident of the State of Ohio) was summoned to answer unto Matthew
Hobson, a citizen and resident of the State of Alabama, in the said
United States of America, of a plea of covenant broken, and
thereupon the said Matthew, by Wm. Key Bond and H. Stanbery, his
attorneys, complains: for that whereas, heretofore, to-wit, on 25
September, A.D. 1830, at Chillicothe, in the said District of Ohio,
by a certain article of agreement, made and executed, as well by
the said Matthew as by the said Duncan and sealed with their seals
respectively, which said article being on file in this court
Page 48 U. S. 746
as an exhibit in the case in chancery hereinafter mentioned, the
said plaintiff is unable to make profert thereof, it was, among
other things, witnessed:"
"That whereas on the 10th day of November in the year of our
Lord 1810, a contract was entered into by and between John Hobson
and Matthew Hobson (the said plaintiff) of the one part and Duncan
McArthur (the said defendant's intestate) of the other part,
providing for the withdrawal of certain entries of land warrants,
and the relocation of the same, as by reference to said contract
will appear, since which time the said John Hobson had transferred
his interest in said contract to the said Duncan McArthur, and
whereas, on 26 May, 1830, the Congress of the United States passed
and enacted a certain statute in virtue of which it became
competent for the parties to the said last-mentioned contract, as
holders and owners of the reentries made under said last-mentioned
contract, to relinquish the same to the United States, and receive
therefor the amount at which the lands included in said entries
were valued by an inquest appointed by the United States, with
interest, as by the said statute would appear."
"And whereas the said Matthew and Duncan were each willing to
make such relinquishment to the United States and avail themselves
of the benefits of the said act of Congress, but had disagreed
about their respective rights under said last-mentioned contract,
in consequence of which said disagreement the said Duncan McArthur
had then recently instituted a certain suit in chancery in the
Supreme Court of the State of Ohio in and for the County of Ross,
in said state; and, among other things, had obtained an injunction
in said cause restraining the said Matthew Hobson from receiving
any money under the said act of Congress, until the matters could
be inquired into, as by reference to said suit would fully
appear."
"And whereas (as is further recited by said article of agreement
first herein mentioned) the said parties, to-wit, the said Matthew
and Duncan, were then mutually willing and anxious that the said
money, so appropriated by the said act of Congress, or such part of
it as should await the determination of said suit, should not
remain inactive, and did therefore wish to put the whole matter in
such state as would make the fund available and profitable pending
the same suit, but without in any manner affecting or being held or
interpreted as affecting their said controversy, in order to
accomplish which it had then been determined and arranged that the
said Matthew should assign and transfer to the said Duncan all the
interest of the said Matthew of, in, and unto the said entries and
warrants in such way as would enable the said Duncan to receive
from the United States the moneys aforesaid, out of which said
money the said Duncan should at
Page 48 U. S. 747
once pay to the said Matthew the sum of eleven thousand five
hundred dollars, and retain the balance of the same in his, the
said Duncan's, possession, and the said Duncan, in and by the said
article of agreement first herein mentioned, did covenant to and
with the said Matthew that if, in the said suit so instituted as
aforesaid, it should be held, adjudged, decreed, or determined that
the said Matthew, his heirs or assigns, executors or
administrators, were or should be entitled to any greater portion
of said money, directly or indirectly, than the said sum of eleven
thousand five hundred dollars, then and in such case he, the said
Duncan, his heirs, executors, or administrators, should and would
pay to the said Matthew, his heirs, executors, administrators, or
assigns, at the Bank of Chillicothe any such excess over and above
said sum, together with interest on such excess, from the day of
the date of said article of agreement, which said covenant last
aforesaid, it was provided by said article of agreement, should be
held to embrace any judgment, order, or decree, which might produce
the said result, whether made and rendered in said suit in chancery
or in any other suit or before any other tribunal, founded on the
same subject matter or contract, and in and by said first-mentioned
article of agreement it was further witnessed that the said Matthew
Hobson did thereby covenant to and with the said Duncan McArthur
that in case it should be determined, held, ordered, adjudged, or
decreed in said chancery suit, or before any other tribunal finally
decided in a suit founded on the same subject matter that he, the
said Matthew Hobson, was entitled to a less sum than the aforesaid
sum of eleven thousand five hundred dollars, then and in such case
he, the said Matthew Hobson, his heirs, executors, and
administrators should and would refund and pay to the said Duncan
McArthur, his heirs, executors, administrators, or assigns, at the
Bank of Chillicothe, the said amount so received by him beyond what
he was entitled to, with interest thereon from the said date of
said article of agreement."
"The said plaintiff further says that in performance of his
covenant in that behalf in said article of agreement mentioned, he
did afterwards, to-wit on the said 25 September, A.D. 1830, at
Chillicothe aforesaid, assign and transfer to the said Duncan
McArthur all the interest of him, the said Matthew, of, in, and
unto the said entries and warrants, which said assignment and
transfer was then and there accepted and received by the said
Duncan in discharge of the said covenant of the plaintiff in that
behalf so made as aforesaid. In virtue of which said assignment and
transfer, the said Duncan afterwards, to-wit on the same day and
year last aforesaid, at Chillicothe
Page 48 U. S. 748
aforesaid, did receive from the United States the moneys so
appropriated, amounting in the whole to a large sum of money,
to-wit, the sum of fifty-seven thousand six hundred and eight
dollars."
"And the said plaintiff further says that such proceedings were
afterwards had in the said suit in chancery, referred to in said
before-recited article of agreement, that afterwards, to-wit, at
the December term, A.D. 1831, of said Circuit Court for the Seventh
Circuit and District of Ohio, the said suit in chancery was, on the
petition of said Matthew Hobson on the ground of his residence and
citizenship in the State of Alabama aforesaid, removed to and
docketed in the said circuit court, and such further proceedings
were afterwards had in said suit that the same was finally heard
and decided before the Supreme Court of the United States at
Washington, to which said court the same had been taken by appeal
from the decree of said circuit court, at the January term thereof,
A.D. 1842, and such decree was by the said Supreme Court of the
United States then and there rendered that it was adjudged and
ordered that the said Matthew Hobson should recover against the
complainants in said suit,
viz., Allen C. McArthur, James
D. McArthur, Effie Coons, Mary Trimble, Eliza Anderson, Frances
Walker, and John Kercheval, heirs at law of said Duncan McArthur
(he, the said Duncan, having deceased during the pendency of said
suit, and the said last-mentioned complainants having been made
parties thereto in his place and stead) the sum of one hundred and
sixty-six dollars and eighty-three cents, for his costs therein
expended, and that he have execution therefor, and further that the
said cause should be and the same thereby was remanded to the said
circuit court with directions to the said last-mentioned court to
dismiss the bill without prejudice."
"And afterwards, to-wit, at the July term, A.D. 1843, of the
said circuit court, to which the mandate of the said Supreme Court
had been duly sent for execution of the said last-mentioned decree,
the said bill was, by the order of said circuit court, in
conformity with said mandate, dismissed without prejudice, all
which will more fully and at large appear by reference to the
record and proceedings of said suit in chancery, and the said
mandate, and several orders and decrees therein now in said court
remaining."
"And the said plaintiff further avers and in fact says that in
virtue of the decree aforesaid, he is well entitled to have and
demand of and from the said defendant, as administrator as
aforesaid, a greater portion of the said moneys, so received by the
said Duncan McArthur as aforesaid than the said sum of
Page 48 U. S. 749
eleven thousand five hundred dollars, which last-mentioned sum
the plaintiff admits he received from said Duncan at and after the
execution of said article of agreement, to-wit, the sum of three
thousand two hundred and one dollars, with interest thereon from
the said 25 September, A.D. 1830. Of all which premises the said
defendant, afterwards, to-wit, on 10 July, A.D. 1843, at
Cincinnati, in the District of Ohio aforesaid, had due notice; yet
neither the said Duncan whilst in life nor the said defendant as
administrator as aforesaid, since the decease of said Duncan, has
at any time, though thereto requested, paid to said plaintiff the
said last-mentioned sum of money at the Bank of Chillicothe or
elsewhere, or any part thereof, but the same to do have hitherto
refused, and the same, with the accruing interest, still remains
wholly due and unpaid. Wherefore the said plaintiff saith, that
neither the said Duncan nor the said defendant, his administrator
as aforesaid, hath kept the said covenant in that behalf, but the
same is broken, to the damage of the said plaintiff of ten thousand
dollars, and therefore he brings suit &c."
"BOND & H. STANBERY,
Attorneys for Plaintiff"
The defendant demurred to this declaration, but his demurrer was
overruled.
At December term, 1843, the defendant craved oyer of the
agreement, and pleaded
non est factum and
nul tiel
record. The plaintiff joined issue upon both pleas.
Page 48 U. S. 753
MR. JUSTICE NELSON delivered the opinion of the Court.
The questions presented arise upon the record of judgment, no
bill of exceptions having been taken to the rulings of the court at
the trial. It is insisted that the declaration is fatally defective
and the judgment for that reason erroneous.
The action is covenant, brought by Matthew Hobson against
William McDonald, as administrator of Duncan McArthur,
deceased.
The declaration recites that, on 10 November, 1810, a contract
was entered into between the said Matthew and Duncan providing for
the withdrawal of certain entries of land warrants
Page 48 U. S. 754
and relocation of the same; that on 26 May, 1830, Congress
passed an act which enabled the parties, as holders and owners of
these warrants, to relinquish the same, and receive their value in
money; that the said Hobson and McArthur were each willing to make
such relinquishment and to avail themselves of the provisions of
the act, but that they had disagreed as to their respective rights
under the contract of 1810, in consequence of which disagreement
McArthur had commenced a suit in chancery in the State of Ohio
against Hobson and had obtained an injunction restraining him from
receiving any of the moneys under the act of Congress until the
matters in dispute should be settled; that both parties had then
become anxious that the money, or such part of it as must otherwise
await the determination of the suit, should not remain useless, and
therefore desired to put their differences on such a footing as
would make the fund available and profitable during the litigation,
and at the same time without in any manner affecting the suit; that
in order to accomplish this, it had been agreed that Hobson should
assign and transfer to McArthur all his interest in the said
warrants, so as to enable him to receive the money from the
government, out of which he should at once pay over to Hobson the
sum of $11,500 and retain the balance, and the said McArthur did
then and there covenant to and with the said Hobson that if it
should be adjudged and determined in the suit in chancery that the
latter was entitled to a greater portion of the money than the
$11,500, directly or indirectly, then and in such case McArthur
would pay to him such further amount with interest at the Bank of
Chillicothe. It was at the same time declared that the covenant
should be held to embrace any judgment or decree that might produce
this result, whether rendered in the suit in chancery or in any
other suit or before any other tribunal founded on the same subject
matter. And the said Hobson did also then and there covenant to and
with McArthur that in case it should be adjudged and determined in
the suit in chancery or in any other tribunal that he was entitled
to a less sum than the $11,500, then and in such case he would
refund to McArthur the excess so received, with interest, at the
Bank of Chillicothe.
The declaration then, after setting out the transfer of the
interest of Hobson in the land warrants to McArthur, and also the
receipt of the sum of $57,608 from the government by the latter,
averred that such proceedings were had in the suit in chancery that
it was removed into the circuit court of the United States and that
such further proceedings were there had that it was finally heard
and decided in the Supreme Court of the United States, at
Washington, at the January term, 1842, to
Page 48 U. S. 755
which the same had been carried by appeal, and such decree was
then and there rendered as adjudged and ordered that Hobson recover
against McArthur $166.83 for his costs, and that the cause be
remanded to the circuit court with directions to dismiss the bill
without prejudice -- all which was afterwards done at the following
July term of the circuit court accordingly.
The plaintiff then avers that, in virtue of the decree
aforesaid, he is well entitled to have and demand of and from the
defendant, as administrator as aforesaid, a greater portion of the
said moneys, so received by McArthur, than the sum of $11,500,
to-wit, the sum of $3,201, with interest from 25 September, 1830,
the date of the articles of agreement -- of all which the defendant
had notice.
The usual breach is then set out, concluding to the damage of
the plaintiff of $10,000.
The defendant put in a demurrer to the declaration, which was
afterwards overruled by the court. He then craved oyer of the
articles of agreement, and, after setting them out in
haec
verba pleaded 1st
non est factum and 2d, as to the
decree,
nul tiel record. Upon which issues were joined,
and were found for the plaintiff, and the damages assessed at the
sum of $5,833.30.
The question presented for our decision is as to the sufficiency
of the declaration after verdict, and this depends upon the
construction to be given to the articles of agreement upon which
the action is founded and as set forth in the pleadings.
The construction given by one pleader is that the decree or
order on the suit in chancery mentioned in the agreement, and upon
which the right to any portion of the fund in dispute, beyond the
$11,500 already received is made to depend, need not determine
either the right to any excess beyond that sum, or, if any, the
amount of it, but, on the contrary, either or both may be
established by evidence independently of the proceedings in that or
any other suit, and that the decree is material only as showing the
suit to be at an end. Hence, after setting out the decree by which
it appears that the bill of complaint had been dismissed with
costs, the pleader proceeds to aver that, in virtue of the decree,
the said plaintiff is well entitled to have and demand of and from
the defendant a greater portion of the said moneys, so received by
the said McArthur, than the sum of $11,500, to-wit, the sum of
$3,201, with interest.
This, it is said, is an averment of a matter of fact, and not of
a conclusion of law, and that after verdict, the court must presume
that evidence was given on the trial to establish the right of the
plaintiff to the amount recovered over and above
Page 48 U. S. 756
the sum already received, and that upon this ground the judgment
may well be sustained.
This is the view of the case as set forth in the declaration and
which was sought to be sustained in the argument, and conceding it
to present the true construction of the articles of agreement --
though the averment is certainly informal and illogical in the mode
of stating it, as it is difficult to perceive how the right to the
sum of money claimed, or to any sum, can result to the plaintiff,
even as a matter of fact, in virtue of a decree dismissing a bill
in chancery against him -- yet, with the usual intendments of the
law in support of a judgment after verdict, it might perhaps be
deemed sufficient. The appellate court would presume that evidence
had been required and given, under the averment at the trial to
support the claim to the amount recovered. 1 Saund. 228, n. 1; 1
Chit.Pl. 589; 1 Maule & Selw. 234; Doug. 68; 7 Wend. 396.
But the Court is of opinion that the pleader has mistaken
altogether the true construction of the agreement in the particular
mentioned, and has placed the right of action upon ground not
warranted by any of the stipulations of the parties. This will be
apparent, on recurring for a moment to the agreement as set forth
in the pleadings.
The recitals show, that a dispute had arisen in respect to the
division of a large sum of money coming from the government, in
which the parties were jointly interested, and that a suit had been
commenced by McArthur against Hobson, in chancery, enjoining him
from receiving any part of it, until their rights had been
judicially determined. The effect of this proceeding was to tie up
the fund in chancery, pending the litigation, and until the court
could make a proper distribution. It was to remedy this
inconvenience, and to enable the parties to possess themselves of
the fund, pending the controversy, that the agreement in question
was entered into, and which was in substance as follows. McArthur
was to receive the whole of the money from the government, and at
once pay over to Hobson $11,500, retaining in his possession the
residue; and if, in the suit then pending, it should be determined,
directly or indirectly, that Hobson was entitled to a larger amount
for his share, then McArthur would pay such additional sum, with
interest, at the Bank of Chillicothe, and, on the other hand, if it
should be determined that Hobson's portion of the fund was less
than the sum already received, he would refund the excess, with
interest, to McArthur at the same place.
The object of the parties was to procure the money from the
government, where it was lying idle, and, at the same time, to
Page 48 U. S. 757
make a provisional distribution, without in any way interfering
with the suit in chancery. That was to be carried on for the
purpose for which it was originally commenced, but as a provisional
division had taken place, it became necessary to provide for a
special decree, having reference to the changed situation of the
fund, and, as the suit had become an amicable one, to provide also
for the payment of any sum that might be found due from either
party. Hence the stipulation that the decree should be made upon
the basis of this provisional distribution and that the parties
should pay over at once any balance that might be found due without
further proceedings.
The strongest proof exists in the agreement itself that the
parties did not intend to interfere with the settlement of their
differences by the suit in chancery or by some other suit to be
instituted for that purpose, for the last article provides that
this contract shall not be used by either party in the suit
pending, or in any other suit, or in any other court, or in any
proceeding under the contract of 1810, as affecting or in any way
changing the rights of either in the matters in dispute, but that
the suit in chancery, or any suit which either might think proper
to bring, should be conducted in all respects as though this
contract had not been entered into.
We think, therefore, it is clear the parties intended that their
respective rights to the common fund in question should be settled
and fixed by the chancery suit then pending, or by some other legal
proceeding that might be instituted for the purpose, and that, when
so settled, they would conform the provisional distribution already
made to the decision by paying over at once the amount adjudged to
be due, for we have seen that instead of interfering with the suit
which had been already commenced, great pains are taken to guard
against any such consequence and, as if apprehensive that their
rights might not be definitively settled by that suit, provision is
made for the institution of any other by either party before the
same or any other tribunal having cognizance of the case.
In a word, the whole amount of the agreement is to provide first
for a provisional distribution of the fund, so that the money might
be used pending the litigation; secondly, for a judicial
determination of the controversy in respect to it in some court of
law or equity; and thirdly for the payment of any balance that
might be found due from either at the Bank of Chillicothe.
This being in our judgment the legal effect of the agreement, it
is manifest that the pleader has failed to comprehend it, and has
therefore failed to set out any cause of action in
Page 48 U. S. 758
the declaration. There is a total omission of any averment of
the fact upon which the right of the plaintiff to any portion of
the fund beyond the $11,500 is made to depend -- namely a judgment,
order, or decree awarding to him the amount. There is not only an
omission of any such averment, but the contrary appears upon the
face of the declaration, as the decree in the chancery suit is set
out and its contents particularly described.
It is a decree simply dismissing the bill of complaint, with
costs. It may show that the defendant (now plaintiff) had not
received more than his share of the money in the division,
otherwise the bill would not have been dismissed; but not that the
defendant was entitled to more, unless the dismissal of a bill is
evidence that something is due from the complainant to the
defendant.
Neither can we presume, even after verdict, that evidence was
given at the trial, by which it was made to appear that the decree
did determine that the amount which has been recovered in this suit
was due from McArthur to the plaintiff, for this would be a
presumption against the fact of the record. That shows what decree
was rendered, and any one of a different import would have been
inadmissible under the pleadings.
Besides, there should have been an averment not only that a
decree was rendered in the suit in chancery, but that the sum
claimed had been therein adjudged to the plaintiff. This is made
the foundation of the right to the money, and of course of the
action, by the agreement, and the omission is fatal to the
judgment.
It is the case of a total omission to state any title or cause
of action in the declaration -- a defect which the verdict will not
cure, either at common law or by statute. Doug. 683; Cowp. 826; 1
Johns. 453; 2
id. 557; 17
id. 439.
The averment that, in virtue of the decree, the plaintiff was
well entitled to recover &c. is insufficient either as matter
of law or of fact. As matter of law, it was given up in the
argument, as no such legal consequence could follow from the
premises stated, and as matter of fact the averment is in
contradiction to the record itself. That shows that the decree
determined nothing in favor of the plaintiff; it dismissed the bill
against him with costs, and nothing more.
Some weight was given in the argument to the peculiar
phraseology of the covenant on the part of McArthur wherein it is
provided that if it should be determined in the chancery suit that
the plaintiff was entitled to any greater portion of the money,
directly or indirectly, than the $11,500, then and
Page 48 U. S. 759
in that case he would pay &c. The object of using the words
"directly or indirectly" in the connection found is perhaps, at
best, but matter of conjecture. But as the chancery suit was
against Hobson for the purpose of asserting claims and demands
against him by the complainant, it was, according to the rules of
chancery, an inappropriate proceeding for the purpose of asserting
claims on the part of the defendant against the complainant. These
would have required a cross-bill. But as the suit had become an
amicable one, it was provided that the claims of both parties might
be settled therein notwithstanding the irregularity of the
proceeding, and hence the use of the peculiar phraseology referred
to.
This explanation receives some confirmation from the covenant on
the part of Hobson with McArthur. These words are there omitted.
The suit was appropriate to enforce any claim against him.
It was said also, and some stress laid upon the remark, that the
agreement would not have provided for the voluntary payment of the
balance that might be due from one to the other if it had
contemplated an adjustment of the particular amount by the suit in
chancery, as in that event the payment could be enforced by the
decree.
But we think this consideration leads to an opposite conclusion.
How could the payment be made at the bank, as provided, unless the
amount in dispute was first adjusted.
There was no dispute about the payment except as respected the
amount. That being determined, each party was ready to satisfy it.
Besides, it is difficult to believe that in providing so specially
for the settlement of the controversy by judicial proceedings, the
parties had in view simply the determination of the question
whether the one or the other had received more of the fund than his
share, without regard to the amount. Such a decision would have
been idle, as it could lead to no practical result in the
settlement of their differences.
Upon the whole, for the reasons stated, we think the judgment
below erroneous, and should be
Reversed and the cause remanded to the court below for
further proceedings.
MR. JUSTICE WAYNE, being indisposed, did not sit in this
cause.
MR. JUSTICE WOODBURY dissented.
Order
This cause came on to be heard on the transcript of the record
from the Circuit Court of the United States for the
Page 48 U. S. 760
District of Ohio and was argued by counsel. On consideration
whereof it is now here ordered and adjudged by this Court that the
judgment of the said circuit court in this cause be and the same is
hereby reversed, with costs, and that this cause be and the same is
hereby remanded to the said circuit court for further proceedings
to be had therein in conformity to the opinion of this Court.
