If an account stated be pleaded in bar to a bill in equity, such
plea will be sustained except so far as the complainant shall show
it to be erroneous.
The plaintiffs were aliens, their testators were citizens of
Georgia, the suit being against citizens of Georgia. Although the
plaintiffs sued as trustees, they were entitled to sue in the
circuit court.
No practice could be more dangerous than that of opening
accounts which the parties themselves have adjusted on a suggestion
supported by doubtful or only probable testimony. But if palpable
errors be shown, errors which cannot be misunderstood, the
settlement must so far be considered as made upon absolute mistake
or imposition, and ought not to be obligatory on the injured
party
or his representatives, because such items cannot be supposed to
have received his assent. The whole labor of proof lies on the
party objecting to the account, and the errors which he does not
plainly establish cannot be supposed to exist.
The bill states that the complainants' testator and the
defendant's testator, together with three others,
viz.,
Boisfeillet, Du Bignon, and Grand Closmesle, became joint
purchasers of the Islands of Sapelo, Blackbeard, Jekyll, and half
of St. Catharine, on the coast of Georgia; that Dumoussay was the
acting partner, and kept all the accounts, &c. That an account
was stated and signed by the two testators, Chappedelaine and
Dumoussay, on 30 April, 1792, by which the former acknowledged a
balance of �667 10s. 1 3/4d. due to the latter, but that the
account was erroneous in sundry items particularly set forth in the
bill; that there were sundry debits which had accrued since that
settlement, and that Chappedelaine had been obliged by a suit in
equity to refund to Boisfeillet a large sum which Dumoussay had
overcharged him. That Dechenaux was the executor of the estate of
Chappedelaine as well as of Dumoussay, and as executor of
Chappedelaine had defended the suit of Boisfeillet. The bill
contains a prayer that the defendant may account touching all
monies due on rectifying the errors, and for all other sums due by
Dumoussay in his lifetime not credited nor accounted for or which
have come to the hands of the defendant, and that he pay over such
balance as shall appear on settlement of all accounts, and for
general relief. The defendant pleaded the settled account in bar of
so much of the bill as sought to open the account, and by answer
denied all fraud and error.
Page 8 U. S. 307
Upon hearing, the court below ordered a reference to auditors,
with directions
"to make a general statement of accounts between the parties,
rejecting any erroneous charges which may appear in their
settlement and adding such as may have been omitted."
The auditors, on 23 April, 1805, instead of stating an account,
reported that they found "a balance due from the defendant to the
complainants, including interest upon the liquidated account up to
this date, $15,586.22."
They stated that they had not taken into consideration a claim
of the complainants of �1,000, which the estate of Chappedelaine
was condemned to pay to Boisfeillet by decree of the court, nor
their claim for indemnity for damages said to have been sustained
by sale of lands, conceiving those claims not submitted to them,
but reserved for the decision of the court.
Exceptions being taken to this report, the court ordered the
auditors to
"make a statement showing the items of the general account,
which they rejected, in whole or in part, and the reasons of their
rejections, and also such items as were added as omissions, and
their reasons for so doing."
In obedience to this order, the auditors made an explanatory
report, whereupon the court decreed that �604 6s. and �579 8s. 1d.
be deducted from the liquidated account of 30 April, 1792; that
interest be allowed on the balance at eight percent from that date,
and that the defendant pay out of the assets that balance and
interest, and the further sum of $3,823, being the amount stated by
the auditors as having accrued since 30 April, 1792, and costs.
The errors assigned in the record were,
1. That the bill was insufficient in law.
2. That the court had not jurisdiction, because although the
bill states the complainants to be French citizens and the
defendant a citizen of Georgia, yet the two testators were citizens
of Georgia.
Page 8 U. S. 308
3. That I. Trubert, who is stated in the answer to be residuary
legatee of Dumoussay, was not made a party, and because the other
legatees were not made parties.
4. That the stated account has been partially opened, and
abatements made to the injury of the legatee.
5. That the exceptions to the report of the auditors ought to
have been sustained.
Page 8 U. S. 309
MR. CHIEF JUSTICE MARSHALL delivered the opinion of the Court as
follows:
The bill in this case is brought to set aside a stated account
which was signed by Dumoussay and Chappedelaine in July, 1792, on
the suggestion of fraud on the part of Dumoussay, or, if it be not
set aside, to correct its errors and to obtain a settlement of
transactions subsequent to that account.
The stated account is pleaded in bar of so much of the bill as
requires that the subject should again be opened and the particular
errors assigned, with the exception of one in the addition, are
denied in the answer.
That the plea in bar must be sustained, except so far as it may
be in the power of the representatives of Chappedelaine to show
clearly that errors have been committed, is a proposition about
which no member of the Court has doubted for an instant. No
practice could be more dangerous than that of opening accounts
which the parties themselves have adjusted on suggestion supported
by doubtful or by only probable testimony. But if palpable errors
be shown, errors which cannot be misunderstood, the settlement must
so far be considered as made upon absolute mistake or imposition,
and ought not to be obligatory on the injured party or his
representatives, because such items cannot be supposed to have
received his assent. The whole labor of proof lies upon the party
objecting to the account, and errors which he does not plainly
establish cannot be supposed to exist. Upon this principle, the
report of the auditors in this case, and the exceptions to that
report
Page 8 U. S. 310
so far as respects the stated account, are to be considered.
The first exception relates only to the manner in which the
auditors understood the order referring the accounts to them, and
need not be considered, since the sole inquiry will be whether they
have in fact made any deduction from the stated account which was
not warranted by the interlocutory order, an order made on the
principles which this Court has already declared to be correct.
The second exception refers to the particular deductions made by
the auditors. The first is that the item in the stated account of
�604 6s. 5d. is reduced to �333 0s. 8d.
The stated account between the parties, marked in the
proceedings as the exhibit A, contains this item and states it to
be one-fifth of the expenses for disbursements on the Island of
Sapelo, which was the joint property of a company consisting of
five, of which Dumoussay and Chappedelaine were partners. The items
which composed this general account are all contained in exhibit F,
stated by Dumoussay on 3 May, 1792, and assented to by
Chappedelaine on 23 July, 1792, when the stated account was signed.
The total of those disbursements is �4,224 3s. 8 1/2d., and the
balance upon the account is �3,021 12s. 1 1/2d., the fifth of which
is �604 6s. 5d.
In their explanatory report, the auditors say that they took as
the basis of this reduction an account settled by auditors in a
suit decided in the Circuit Court of Georgia, which was instituted
by Boisfeillet, one of the absent partners, against Dechenaux, who
was executor both of Dumoussay and Chappedelaine. The auditors in
that case were examined, and they depose that their corrections
were made on the proof of double entries, false charges, omissions
acknowledged by the executor of Dumoussay, and charges not proper
to be made against Boisfeillet.
This testimony would of itself be sufficient to convince the
Court that injustice was done in the settlement
Page 8 U. S. 311
of July, 1792, but would not show explicitly the amount of that
injustice and enable them to say what deductions from that
settlement ought to be allowed, because, as was well observed by
the counsel for Dechenaux, items might be properly chargeable to
Chappedelaine of which Boisfeillet ought not to bear a part.
The court therefore sought, in the documents connected with the
report, for that more explicit information.
Upon looking into the exhibit F, there are, upon the face of the
paper, obvious errors which demonstrate the incorrectness of that
statement and the excessive inattention of Chappedelaine.
The first item on the debit side of this exhibit is the sum of
�3,571 3s. 8 1/2d. disbursed for Sapelo. The funds for this
disbursement were in part in the hands of Dumoussay as the remnant
of advances previously made by the partners. To this remnant he
states himself to have added �2,368 12s. 0 1/2d. from his private
funds. On this advance made by himself in Georgia, he charges the
company 15 percent, amounting to �354 on account of the difference
of exchange between money in France and in Georgia, or as he
expresses it, for exchange, freight, and insurance.
This charge has been rejected in the accounts of all the
partners for many obvious reasons. It is sufficient to observe that
as this money was advanced in Georgia by Dumoussay, and repaid to
him in Georgia by the partners, there was as much reason for making
these charges on the repayment as on the original advance, and with
respect to Chappedelaine, it is still more inadmissible, because he
had previously advanced his portion of this money to Dumoussay, and
had allowed him 15 percent for these charges in a deduction from
that advance, so that this charge, with respect to Chappedelaine,
is double.
The third item in this exhibit is a charge of �299 as one year's
interest on �2,368 12s. 0 1/2d. This is more than double the real
amount of interest.
Page 8 U. S. 312
There is also in the credit side of the account an error of �100
in the addition. The errors apparent on the face of the exhibit F
amount to �611, and these errors are of such a description as
strongly to characterize the stated account of July, 1792.
In the account stated by the auditors, there are omissions of
monies received by Dumoussay, and admitted to be chargeable to him
in this account with the company, amounting to �189 10s. 10d.
The account containing these incontestable errors was submitted
to auditors, and still further reduced by them. Several of the
small errors which they have detected are perceived, but the whole
cannot be traced by this Court without engaging in the laborious
task of auditors, which is incompatible with our duties. To that
account the executor of Dumoussay, who was also the executor of
Chappedelaine, was a party, and had a right, with respect to
Boisfeillet, to rely upon the stated account of July, 1792, signed
by Chappedelaine, because Chappedelaine was the attorney in fact of
Boisfeillet, and because Boisfeillet had sanctioned that
settlement, and had assumed the payment of his part. Yet in that
case the deductions from that account were made which the auditors
in this case have taken as the basis of their settlement, and those
deductions were made in consequence of double entries, false
charges, and charges not admissible against Boisfeillet.
The great difficulty in admitting such an account under such
circumstances consists in the uncertainty of the amount of those
charges which were rejected as being inapplicable to Boisfeillet.
This difficulty is removed in a great measure by inspecting the
report in the present case. In that report, the auditors take up
the items which were rejected on this principle and charge them to
Chappedelaine, so that in truth the alterations made in this item
are all founded on errors which the auditors have corrected.
The second item of this exception is that the auditors reduced
the sum of �336 16s. 3d. admitted in the stated account as being
one-fourth of the purchase and expense of Jekyl to �311 9s. 6d.,
making a difference of �25 7s. 2d.
Page 8 U. S. 313
This item in the exhibit A, which is the stated account, is the
result of the exhibit G, which is the account of Jekyl, as settled
between Dumoussay and Chappedelaine. There is an obvious error of
$4 19s. 10d. in the division, of �3 10s. in the hire of negroes,
and the residue of the sum deducted is on account of the same
charges on the monies advanced for Jekyl, which were made on the
monies advanced for Sapelo, and which are rejected for the same
reasons which were assigned for their rejection in that item of the
account.
The auditors also reduced the sum of �990 3s. 1d. assumed by
Chappedelaine for Boisfeillet, to the sum of �410, making a
difference of �580 3s. 1d. Nothing can be more obvious than the
propriety of this reduction. Dumoussay charges Chappedelaine with
the debt of Boisfeillet, amounting, as he says, to �990 3s. 1d.,
which Chappedelaine assumes as the attorney of Boisfeillet. In a
suit to which the executor of Dumoussay is a party, this debt
appears to have been only �410. No man can hesitate to admit that
Chappedelaine must have credit with Dumoussay for the difference
between the sum alleged to be due and the sum actually due from
Boisfeillet.
The auditors also struck out of the stated account the sum of
�554 9s. 4d. assumed by Chappedelaine for one of the absent
partners, that being considered by mistake as the share of that
absent partner in the expenses of Sapelo. The sum actually due by
that partner was afterwards paid by himself to the executor of
Dumoussay. The Court is satisfied from the evidence that this
payment was made to Dechenaux as the executor of Dumoussay. The
assumpsit of Chappedelaine was essentially as security for the
absent partner, who still remained a debtor, and when the principal
did himself pay what he owed to the original creditor, the
assumpsit of Chappedelaine was of no further obligation. Although
this was not an error in the account when settled except so far as
this charge exceeded the sum with which the absent partner was
really chargeable, yet it becomes an item which can no longer be
retained as a charge against Chappedelaine, and in reforming
Page 8 U. S. 314
their accounts it must be excluded from them.
There is also added to the credits of Chappedelaine the sum of
�26 18s. which the auditors state to be the difference between the
amount of a receipt given by Dumoussay and the sum actually debited
to him in the accounts between the parties.
These several errors make up the sum of �1,457 8s. 4d. from
which is to be deducted the sum of �667 10s. 1 3-4d. admitted on
the stated account to be due from Chappedelaine to Dumoussay. The
balance standing to the credit of Chappedelaine would be, on 30
April, 1792, �789 18s. 2 1/4d.
The auditors state this balance at �1,346 10s. 7d. But from this
balance reported by the auditors is to be taken the sum of �305
13s. allowed by Chappedelaine on the repayment in Georgia of money
lent by him to Dumoussay in France. This sum has been disallowed by
the auditors, but was allowed by the circuit court and is allowed
by this Court. This would reduce the report of the auditors to
�1,030 17s. 7d., exceeding the balance which is here supposed by
the sum of �240 19s. 4 3/4d.
The greatest part of this excess is produced by one-third of
merchandise sold and not entered in the account and by a credit for
continuing interest up to 30 April, 1792, on Chappedelaine's money
in the hands of Dumoussay, which credits had been omitted in the
stated account without any apparent reason, and must therefore have
been among the numerous inaccuracies of that account. The residue
of this excess is said by the auditors to be produced by numerous
minute errors detected by a laborious investigation of all the
accounts between the parties. This Court cannot pursue them in that
investigation. But in a case so replete with errors, which mark
excessive negligence on the one side and which can scarcely be
ascribed to mistake on the other, the Court is of opinion that the
report of the auditors stating that these corrections were made on
the inspection of the vouchers and entries which
Page 8 U. S. 315
were laid before them ought to be received unless the person
taking the exception had himself required the testimony on any
particular point to which he objected to be submitted to the court
or had required a special statement from the auditors, exhibiting
the reasons for their opinion on the particular point.
The balance due to Chappedelaine on 30 April, 1792, is so much
of the loan made by him to Dumoussay in France which remains
unpaid. By the contract between the parties, that loan was to carry
an interest of six percent per annum until paid. The Court
therefore cannot consider it as a claim on an unsettled account or
as carrying interest at the rate established in Georgia. It is
still governed by the law of the contract, and must carry interest
at the rate of six percent per annum.
To the report, so far it respects the accounts subsequent to 30
April, 1792, a general exception is taken which is sufficiently
repelled by the answer of the auditors. They say if in the opinion
of the defendant below the auditors admitted any charge against
Dumoussay which was not sufficiently supported by testimony, he
ought to have obtained a special statement from the auditors, or
have made a special exception, which would bring the testimony on
the particular point before the court. The only objection which the
Court can notice is the allegation in the exception that the
auditors have proceeded on accounts rendered by Dechenaux, without
allowing him a credit which he claimed in those accounts. That
credit is the balance appearing to be due to Dumoussay by the
stated account of July, 1792. But that balance was entirely
changed. The item was fully disproved by the testimony laid before
the auditors. Dechenaux did not then withdraw his account and
require the plaintiff below to support his claims by other
vouchers. It was clearly in the power of the plaintiff to have done
this, for he might have forced Dechenaux to produce the entries and
vouchers from which he had made out the account exhibited by
himself. By leaving this account with the auditors without
objection, he acquiesced in their considering as correct the items
it admitted.
Page 8 U. S. 316
This bill was brought to correct the stated account of July,
1792, and to settle the accounts between the parties subsequent to
that period. The defendant exhibits the accounts subsequent to that
period, but claims to set against them the balance due to his
testator under the settlement of 1792. On those subsequent accounts
that balance has no influence. By introducing it into an account he
was compellable to render, he cannot destroy the effect of that
account. Had he intended to rely on this circumstance, he ought to
have made the point before the auditors, and thus have enabled the
plaintiff to take other measures to substantiate his claim. The
auditors say they "admitted the account presented by the
defendant," but this must be understood with the exception of the
balance which he claimed under the settlement of July, 1792. It
does not appear from their report that the claims of the plaintiff
below rested on that account so far as it went; but it is probable
that further research was deemed unnecessary. The Court cannot say
that in this the auditors erred.
The decree of the circuit court is affirmed so far as it
accords with this opinion and is reversed as to the
residue.