Woodhouse v. Duncan — 11 N.Y. St. Rep. 42

Majority

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Humphrey E. Woodhouse et al., Resp’ts, v. Jacob M. Duncan et al., App’lts.^[1]

(Court of Appeals,

Filed October 4, 1887.

Headnote

1. Charter—Party—Admissibility or evidence as to execution of— Agency.

In an action brought by the plaintiffs to recover a certain sum alleged to be due from the defendants for the use of a steamship under a charter party, the complaint stated the purpose for which the steamship was chartered. The defendants in their answer, besides denying most of the material allegations of the complaint alleged that the steamship was chartered by the firm of Duncan & Poey, that the plaintiffs wholly failed to keep and perform the charter on their part. It appeared at the trial that said firm executed the said charter party in their own name on behalf of all the d fendants. Held, that as the charter party was not under seal it was competent for the plaintiff to show that it was executed by said firm not only for themselves, but as representing all those who chartered the steamship; that they could be treated as agents executing the charter party for themselves and all others interested as principals with them.

2. Same—Judgment—When res adjudicata— Admissible in evidence.

A judgment had been obtained in an admiralty suit," brought in the United States court, wherein the said firm was plaintiff, and the plaintiffs herein were defendants, wherein it was adjudged that the defendants therein (the plaintiffs herein) had fully performed the charter party on

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their part. Held, that said judgment was properly admitted in evidence; that it bound these defendants and conclusively established the performance of the charter party on the part of the plaintiffs herein.

3. Same—Pleading—Necessary parties—Presumption.

For a further defense, it was alleged that three persons named, all of whom were then living, were interested in the same adventure, and were necessary parties defendant. The proof simply showed that at the time of the mating of the charter party the plaintiffs knew that they were contracting with these defendants and had information that some other persons had some slight interest in the adventure. But they had no knowledge that such other persons were interested as partners, or that they were parties to the contract which they were making. Held, that they had a right to suppose that they were not, in any proper sense, parties to the contract. Citing Swift v. Pacific Mail S. Co. and Panama B. B. Co., 8 N. Y. State Rep., 602.

4. Practice—Technical defense not favored.

Held, that a technical defense should be closely scrutinized, and should not be permitted to prevail, if upon any permissible view of the case it can be, avoided.

Appeal from a judgment of the supreme court, general Term, first department, affirming a judgment entered on a verdict of a jury directed in favor of the plaintiff by the presiding judge at the trial at the New York county circuit. The necessary facts are stated in the opinion.

R. D. Benedict, for app’lts; Wm. Allen Butler, for resp’ts.

—This action was brought by the plaintiffs to recover the sum of $6,966.86, alleged to be due from the defendants for the use of the steamship Francis, Wright, under a charter party dated September 18, 1872. The complaint alleges that the steamship was chartered by the defendants for the purpose of going to Galveston, Texas, and bringing thence a cargo of fresh beef. The defendants, in their answer, besides denying most of the material allegations of the complaint, alleged that the steamship was chartered by a written charter party to the firm of Duncan & Poey; that the plaintiffs wholly failed to keep and perform the charter on their part, and failed to keep the vessel tight, staunch, well fitted, tackled and provided with every requisite for such a voyage, as in and by the charter they agreed to do, whereby great damage resulted to the charterers to an amount exceeding the charter money. And for a further defense they alleged as follows, “that the following persons, and no others, were interested in the said adventure, viz., Stephen Flanagan, James M. Flanagan, Edward W. Wilson, B. Boss Boberts, J. Kemp Bartlett, James F. Matthews, Jacob M. Duncan and Simon Poey, and that the said B. Boss Boberts, who resides at Harrisburg, Pennsylvania, J. Kemp Bartlett, who resides at Easton, in the state of Maryland, and James F. Matthews, who resides in New York city, all three of whom are still living, are necessary parties defendant in this action.”

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The action was brought to trial at a circuit court, and the judge presiding directed a verdict in favor of the plaintiffs, and the judgment entered thereon was affirmed at the general term.

It appeared upon the trial that the charter party was signed only by the plaintiffs under the firm name of Woodhouse & Rudd and by the defendants Duncan and Poey under the firm name of Duncan & Poey. The claim is, therefore, made that the action cannot be maintained upon the charter party against all of the defendants. But it appeared at the trial conclusively that Duncan & Poey executed the charter party in their own names on behalf of all the defendants; and as the charter party was not under seal, it was competent for the plaintiffs to show that' it was executed by Duncan & Poey, not only for themselves, but as representing all those who chartered the steamship. They may, therefore, be treated as agents executing the charter party for themselves and all others interested as principals with them. Briggs v. Partridge, 64 N. Y., 357 ; Hill v. Miller, 76 id., 32; Nicoll v. Burke, 78 id., 580.

The charter party contained this stipulation: “The said party of the first part agrees that the said vessel in and during said voyage shall be kept tight, staunch, well-fitted, tackled and provided with every requisite for such a voyage. ” It appeared that the vessel went to G-alveston and there took on a cargo of fresh beef and started upon her return voyage, and that before reaching her destination the beef spoiled and was thrown overboard and was thus wholly lost. The defendants claimed that the loss was occasioned by reason of the defective condition of the boiler and machinery of the vessel in consequence of which she was greatly delayed in making her voyage. Soon after her return Duncan & Poey commenced a suit in admiralty against the steamship and her owners to recover damages for the alleged breach of the charter party in failing to keep the vessel well fitted and provided with every requisite for the voyage, claiming that in consequence thereof the beef was lost and that they sustained great damage. That suit passed through the federal courts to the supreme court of the United States, and the opinion pronounced therein in the latter court is reported in 105 U. S., 381 . The libel in that suit was dismissed on the ground that the defendants in that suit, the owners of the vessel, “had, kept and performed all the covenants and undertakings in the said charter party contained on their part, and that the said vessel in and during said voyage was kept tight, staunch, well-fitted and tackled, and provided with every requisite for the voyage.” One of the conclusions of law found in the record of that court is as follows: “That libellants having

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failed to prove that the damage to the cargo of fresh beef on said steamer was the direct and natural result of any breach of the covenant of seaworthiness in said charter party are not entitled to recover such damages in this action.” The judgment recovered in'that suit was received in evidence upon the trial of this action, and it was held by the trial judge that it conclusively established that the plaintiffs had fully performed the charter party on their part and that the defendants were not entitled to any damages for any alleged breach of covenants therein contained, and that the plaintiffs were entitled to recover the balance of the charter money due. In these holdings, upon the plainest principles, there was no error. The adjudication in that suit was binding upon the parties thereto, and upon those whom they represented and who were in privity with them. Duncan & Poey, who were the libellants and plaintiffs in that suit, represented the charterers and prosecuted the suit, not only for themselves, but for all their associates. Hence, while their associates were not actually parties to the suit, they would have reaped the benefit of a favorable result and were bound by the judgment rendered therein.

They had a right to be heard in the suit, and were heard through Duncan & Poey, and were in privity with them. It was just as much their suit as the suit of Duncan & Poey, and the precise points at issue in that suit, and adjudicated therein, could not again be brought in question between these plaintiff’s and the charterers of the vessel. Embury v. Conner, 3 N. Y., 511 ; Castle v. Noyes, 14 N. Y., 329 ; Tuska v. O'Brien, 68 N. Y., 446 ; Dunham v. Bower, 77 N. Y., 76 ; Church v. Kidd, 88 N. Y., 652 ; Leavitt v. Wolcott, 95 N. Y., 212 . There was, therefore, no error in holding that the adjudication in the admiralty suit bound these defendants and conclusively established the performance of the charter party on the part of these plaintiffs. Hence, there was nothing left for litigation between the parties upon the merits of the case.

But the point is made that the plaintiffs ought to have been defeated, because they did not include in the action as parties defendant E. Boss Eoberts, J. Kemp Bartlett and James P. Mathews, whose names are mentioned in the answer of the defendants. This is an extremely technical defense, and so far as we can perceive of no real consequence to any one. If successful, it would simply result, after a long litigation between these parties through all the federal courts and through the courts of this state to its highest tribunal, in a reversal of this judgment and the bringing in of the three persons named as defendants, and then a judgment against all the defendants would be inev

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itable. A defense thus technical should be closely scrutinized and should not be permitted to prevail, if upon any permissible view of the case it can be avoided.

It was proved upon the trial that all the persons named in the answer were interested in the adventure of bringing beef from Galveston to Philadelphia. Stephen and James M. Flanagan were interested to the extent of one-fifth; Wilson, one-fifth; Duncan and Poey, one-fifth; Roberts, one-fifth; and Bartlett and Mathews, together, one-fifth. If the plaintiffs had known at the time they entered into the charter party that these several persons were interested as claimed, it would have been their duty to make them all defendants in the action, and in that event the contract would really have been made with them all. But if at the time of making the contract the three persons referred to were not known to the plaintiffs to be joint contractors with the defendants and they supposed that they were contracting with the defendants only, then the three persons named could be treated as dormant partners, and it was not necessary to make them parties defendant. Brown v. Birdsall, 29 Barb., 549 ; Farwell v. Davis, 66 Barb., 73 ; Arnold v. Morris, 7 Daly, 498 ; North v. Bloss, 30 N. Y., 374 ; Leslie v. Wiley, 47 N. Y., 648 ; Marvin v. Wilber, 52 N. Y., 270 ; Cookingham v. Lasher, 1 Abb. Ct. Appeals Dec., 438; Bonfield v. Smith, 12 M. & W., 405; DeMautort v. Saunders, 1 B. & Ad, 401; Collyer on Partnership, § 719. It is not sufficient that the plaintiffs may have known that the three persons named, had some sort of interest in the adventure, but they must have known that they were members of a firm with the defendants, or that they were joint contractors with them; and this there was no sufficient evidence in the case to show.

The answer is insufficient. It simply shows that the three persons named, were interested in the adventure. There is no allegation that they were partners, nor is there any allegation that they were joint contractors with the defendants named, or that the plaintiffs made any contract whatever with them.

The proof simply showed that at the time of the making of the charter party the plaintiffs knew that they were contracting with these defendants, and had information that some other persons had some slight interest in the adventure. But they had no knowledge that such other persons were interested as partners, or that they were parties to the contract which they were then making. They may have supposed, as their names were not mentioned, and had a right to suppose, that they had some remote or contingent interest in the profits or proceeds of the adventure, while they were not, in any proper sense, parties to the contract.

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Upon this point the case recently decided by us, of Swift v. The Pacific Mail Steamship Co. and The Panama Railroad Co. (8 N. Y. State Rep., 602), is an authority. This may be regarded as a somewhat narrow view of the evidence given upon the trial, but we think it is admissible for the purpose of defeating what appears to us to be an extremely technical objection.

Some other points were discussed upon the argument before us, but they are not deemed to be of sufficient importance to require particular attention here. They have, received sufficient consideration, and we think, point out no error.

Our conclusion, therefore, is that the judgment should be affirmed, with costs.

All concur.