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GRAY v. ROLLO.
upon equitable considerations, a creditor who has a joint security for a separate debt cannot resort to that security without allowing what he has received on the separate account for which the other was a security. Indeed, it may be generally stated that a joint debt may, in equity, be set off against a separate debt, where there is a clear series of transactions, establishing that there was a joint credit given on account of the separate debt." Other instances are given by way of illustration of the principle on which a court of equity will deviate from the strict rule of mutuality, allowing a set-off ; all of them based on the idea that the justice of the particular case requires it, and that injustice would result from refusing it; but none of them approaching in likeness to the case before the court. There is no rule of justice or equity which requires that Gray Brothers should be paid, in preference to other creditors of the insurance company, out of the specific assets represented by the notes of Gray and Gaylord. If the complainant instead of the insurance company were bankrupt, and the notes were valueless, his brother and the creditors of Gray Brothers would think it very hard if the company were allowed to pay the insurance pro tanto with that worthless paper.
The case of Tucker v. Oxley, 5 Cranch, 34, which arose out of the bankrupt act of 1800, has been pressed upon our attention by the counsel of the appellant, on the supposition that it is decisive in his favor. The clause relating to set-off contained in that act (2 Stat. 33, § 42) does not materially differ from the corresponding clause in the act of 1867. Mutual credits given, and mutual debts existing, before the bankruptcy, are made the ground of set-off in both acts. But the case of Tucker v. Oxley will be found to differ from the present. There two persons by the name of Moore, being partners, became indebted to Tucker. They afterwards dissolved partnership, and Tucker became indebted to one of them, who continued the business, and who afterwards became bankrupt. Oxley, the assignee, sued Tucker for this debt, but the latter was allowed to set off his claim against the two. The court put the decision upon the ground that the debt due from the two Moores to Tucker could have been collected from the property of either of them, and was provable under the bankruptcy proceedings against the estate of him who became bankrupt, and hence it might be set off against any claim which the bankrupt had against Tucker. The case, therefore, was the same as the case before us would have been if the complainant had been solely entitled to the insurance money, and if he and not the company had become bankrupt. In such case the company, according to the case of Tucker v. Oxley, could have set off the notes of the complainant and Gaylord against the claim for insurance. The reciprocal form of this rule would have enabled the complainant to succeed in this case had he been the sole claimant of the money due for insurance. In other words, the case of Tucker v. Oxley decides that a joint indebtedness may be proved and set off against the estate of either of the joint debtors who may become bankrupt, and the fact that it may be subject to be marshalled makes no difference. The joint debtors are severally liable in solido for the whole debt. But the case does not decide that a joint claim, that is to say, a debt due to several joint creditors, can be set off against a debt due by one of them. If a debt is due to A and B, how can any court compel the appropriation of it
SCHLATER v. WIXPENNY.
to pay the indebtedness of A to the common debtor without committing injustice toward B? The debtor who owes a debt to several creditors jointly cannot discharge it by setting up a claim which he has against one of those creditors, for the others have no concern with his claim and cannot be affected by it; and no more can one of several joint creditors, who is sued by the common debtor for a separate claim, set off the joint demand in discharge of his own debt, for he has no right thus to appropriate it.
Equity will not allow him to pay his separate debt out of the joint fund. And if he had the assent of his co-obligees to do this, it would be unjust to the suing debtor, because he has no reciprocal right to do the same thing.
The case before us, therefore, is clearly distinguishable from that of Tucker v. Oxley, and the ground on which that case was put is not applicable to this.
The decree must be affirmed.
A was told in January, 1868, that B's partnership was for one year. Held, that
A in January, 1869, had such notice of its dissolution as put him on inquiry.
ERROR to district court of Philadelphia.
1st. Whether the partnership of F. Schlater & Co. expired on the 1st of January or the 13th of February, 1869 ?
2d. If on the former day, whether the plaintiff below had notice of its dissolution ?
3d. Whether John Clendenning was authorized to wind up the affairs and settle the business of the partnership after its dissolution ?
1. The evidence shows that the plaintiff sold yarns after the 1st of January, 1869, to John Clendenning, who was authorized by power of attorney, bearing date the 17th of January, 1868, “to buy and sell goods and merchandise,” for and in the name of the firm, and that the price of these yarns was included in the notes sued on. The plaintiff himself testified that “ these notes were given for a balance of account and are renewals of others." If then the partnership expired on the 1st of January, 1869, and the plaintiff had notice of its dissolution, it is clear that he is not entitled to recover that portion of the notes embracing the price of the yarns sold after that date, even if John Clendenning, by whom they were given, was authorized to settle the business of the partnership. It is, therefore, a material question, whether the partnership expired on the 1st of January, 1869, or was dissolved on the 13th of February thereafter.
SCHLATER v. WINPENNY.
Clendenning was examined as a witness for the plaintiff, and testified that the partnership continued until the 13th of February, 1869, and that it was then dissolved. On his cross-examination he said that he did not tell Benj. Rowland, Jr., that this firm expired January 1st, 1869; and that he did not tell him that all coal charged to F. Schlater & Co. after that date must be re-charged to himself, as the firm expired January 1st, 1869; and that the coal was not so re-charged, and he did not pay the bill for the same. The defendants called Rowland, who testified: “We furnished coal to F. Schlater & Co. In January and February, 1869, we charged coal to F. Schlater & Co. and sent the bill to Schlater & Co." The defendant then offered to show that Clendenning gave notice to the witness that this partnership ended January 1st, 1869, and that as to the coal charged to F. Schlater & Co. after January 1st, 1869, Clendenning said that it was to be re-charged to John Clendenning; and that it was so re-charged and paid by Clendenning, and that this notice was given before the date of these notes. The plaintiff objected to the offer and the court sustained the objection. The defendant then offered to prove by the witness the declarations of Clendenning that the firm of F. Schlater & Co. was dissolved January 1st, 1869. This offer was objected to unless the plaintiff was present and had notice of the dissolution, and the court sustained the objection and excluded the offer. If anything in the law of evidence can be regarded as settled, it is, that the credit of a witness may be impeached by proof that he has made statements out of court contrary to what he has testified at the trial. The principle is too familiar to need the citation of any authority in its support. The matter in regard to which it was proposed to contradict the witness was material and relevant to the issue ; and his attention was called to the person and the particular circumstances involved in the supposed contradiction. The offers should, therefore, have been admitted, and the court fell into a palpable error in rejecting them.
II. If the defendant informed the plaintiff in January or February, 1868, that the partnership was for one year, and that it ended on the 1st of January, 1869, then the latter had such notice of its dissolution as should have put him upon inquiry. He had no right to sell goods to Clendenning on the credit of the firm after that date without ascertaining that the partnership still continued.
III. The dissolution of the partnership, whether it terminated on 1st of January or the 13th of February, 1869, undoubtedly operated as a revocation of the power of attorney authorizing Clendenning to conduct its business, and unless he was authorized by the members of the firm to settle the business of the partnership after its dissolution, he had no authority to give the notes in controversy. On his cross-examination he said : “ I exercised no powers except under the letter of attorney, which was for the business of F. Schlater & Co.;” but on his reëxamination he said: “I had authority to wind up the affairs of the firm, after dissolution.” In saying this he may have supposed that under the power authorizing him to conduct the business of the firm he had authority to wind up and settle its affairs ; or he may have so testified because he was expressly authorized by the members of the firm to settle the business of the partnership after its dissolution. But be this as it may, it is clear
BARTEMEYER v. STATE OF Iowa.
that the defendant had the right to contradict the witness by showing that he had no power as attorney in fact of the firm, after the dissolution thereof, to wind up its affairs, and, therefore, the court erred in sustaining the objection to the offer unless followed by proof of notice to the plaintiff.
The authority conferred by the power of attorney to conduct the business of the firm, as already suggested, ceased with the dissolution of the partnership, and if the plaintiff knew that the firm was dissolved when the notes were given, as it is manifest that he did, it was his business to see that Clendenning had authority to give them.
It needs no argument to show that the defendant was not bound by the entries made by Clendenning, or by his direction, in the partnership books after the dissolution of the firm ; nor were they evidence against him, unless it was shown that he had assented to them.
Judgment reversed and a venire facias de novo awarded. Edward R. Worrell, Esq., for plaintiff in error. Richard P. White, Esq., for defendant in error.
SUPREME COURT OF THE UNITED STATES.
[OCTOBER TERM, 1873.]
F. BARTEMEYER, SR., plaintiff in error, v. THE STATE OF IOWA.
1. The usual and ordinary legislation of the states regulating or prohibiting the
sale of intoxicating liquors raises no question under the Constitution of the United
States prior lo the fourteenth amendment of that instrument. 2. The right to sell intoxicating liquors is not one of the privileges and immunities
of citizens of the United States which by that amendment the states were forbidden
to abridge. 3. But if a case were presented in which a person owning liquor or other property
at the time a law was passed by the state absolutely prohibiting any sale of it, it would be a very grave question whether such a law would not be inconsistent with the provision of that amendment which forbids the state to deprive any person of
life, liberty, or property without due course of law. 4. While the case before us attempts to present that question, it fails to do it, because
the plea, which is taken as true, does not state, in due form and by positive allegation, the time when the defendant-became the owner of the liquor sold ; and, secondly, because the record satisfies us that this is a moot case, made up to obtain the opinion of this court on a grave constitutional question, without the existence of
the facts necessary to raise that question. 5. In such a case, where the supreme court of the state to which the writ of error is
directed has not considered the question, this court does not feel at liberty to go out of its usual course to decide it. In error to the supreme court of the State of Iowa. Justice MILLER delivered the opinion of the court.
BARTEMEYER 0. STATE OF IOWA.
Bartemeyer, the plaintiff in error, was tried before a justice of the peace on the charge of selling intoxicating liquors, and acquitted. On an appeal to the circuit court of the State the defendant filed the following plea:
“And now comes the defendant, F. Bartemeyer, Sr., and for plea to the information in this cause says: He admits that at the time and place mentioned in said information he did sell and deliver to one Timothy Hickey one (1) glass of intoxicating liquor called whiskey, and did then and there receive pay in lawful money from said Hickey for the same. But defendant alleges that he committed no crime known to the law by the selling of the intoxicating liquor herein before described to said Hickey, for the reason that he, the defendant, was the lawful owner, holder, and possessor, in the State of Iowa, of said property, to wit, said one glass of intoxicating liquor, sold as aforesaid to said Hickey, prior to the day on which the law was passed under which these proceedings are instituted and prosecuted, known as the act for the suppression of intemperance, and being chapter sixty-four (64) of the revision of 1860; and that, prior to the passage of said act for the suppression of intemperance, he was a citizen of the United States and of the State of Iowa." Without
evidence whatever the case was submitted to the court, the parties waiving a jury, and a judgment was rendered that the defendant was guilty as charged. A bill of exceptions was taken, and the case carried to the supreme court of Iowa, and that court affirmed the judgment of the circuit court, and rendered a judgment for costs against the present plaintiff in error.
There is sufficient evidence that the main ground relied on to reverse the judgment in the supreme court of Iowa was, that the act of the Iowa legislature, on which the prosecution was based, was in violation of the Constitution of the United States.
The opinion of that court is in the record, and, so far as the general idea is involved, that acts for suppressing the use of intoxicating drinks are opposed to that instrument, they content themselves with a reference to the previous decisions of that court, namely, Our House No. 2 v. The State, 4 G. Greene, 172; Zumhoff v. The State, 4 Ib. 526; Santo8 v. The State, 2 Iowa, 165. But, referring to the allegation in the plea that the defendant was the owner of the liquor sold before the passage of the act under which he was prosecuted, they say that the transcript fails to show that the admissions and averments of the plea were all the evidence in the case, and that other testimony may have shown that he did not so own and
possess the liquor. The case has been submitted to us on printed arguments. That on the part of the plaintiff in error has taken a very wide range, and is largely composed of the arguments, familiar to all, against the right of the states to regulate the traffic in intoxicating liquors. So far as this argument deals with the mere question of regulating this traffic, or even its total prohibition, as it may have been affected by anything in the federal Constitution prior to the recent amendments of that instrument, we do not propose to enter into a discussion. Up to that time it had been considered as falling within the police regulations of the state, left to their judgment, and subject to no other limitations than such as were imposed by the state constitution, or by the general principles supposed to limit all