Dingeldein v. Third Avenue Railroad — 22 N.Y. Super. Ct. 79

Majority

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John B. Dingeldein, Plaintiff and Respondent, v. The Third Avenue Railroad Company, Defendants and Appellants.

Headnote

1. Where an unincorporated railroad company, desiring to- control the construction of a public sewer under their track, procured the contract with the city for its construction, in the name of the plaintiff one of their members, which required him to do,jit within a fixed time, and to remove obstructions from, and facilitate the preservation- of, the track; and then employed him to do the work, agreeing to pay him his expenses over the contract price, and an allowance for his services, and, it being understood that the time in which, by his contract, he was bound to complete it, was too short, he agreed with them to do it in the shortest possible time, and also in a manner consistent with their interests, and not to stop the running of the cars.

Held, that this agreement with the Company was not illegal as against public policy. »

2. A corporation was subsequently created to operate the railroad, and the Company conveyed their property to the corporation. The grant was, in-terms, subject to the payment the Company had agreed to make to the plaintiff, but contained no covenant to pay it; and the plaintiff went on with the work, with the knowledge of the corporation, and without objection on their part, and their Superintendent, with the knowledge of the President, gave directions as to keeping the track clear.

Held, that these facts did not make the corporation- liable for the plain tiff’s-compensation. To charge them,, there must be- either an entire novation of-the contract, to which the plaintiff, the corporation and the unincorporated company should be parties;' or a new promise on the part of the corporation should be shown.

3. An assignment under seal, expressed to be subject to the payment of a debt to a third person not a party to the instrument, where the assignee does not promise to pay, and the debt to be paid, is not a lien on the thing assigned, does not entitle such third person to maintain an action therefor against the assignee.

4. It seems that illegality in a contract sued on, though shown by the testimony, cannot avail the defendant, unless it is alleged in the pleadings ; and that an allegation in the answer that the contract was illegal, coupled with an enumeration in the same paragraph, of specific grounds of illegality, does not entitle the defendant to prove any ground of illegality not so specified.

(Before Woodruff, Moncrief and Robertson, J. J.)

Heard, October 15, 1861;

decided, December 28th, 1861.

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This was an appeal by defendants from a judgment in favor of the" plaintiff, entered upon the report of Charles P. Kirkland, Esq., Eeferee, to whom the cause was referred for trial.

• The plaintiff sought to recover, in this action, the excess of his expenditure in building a public sewer in the Third Avenue, one of the public streets of the Oity of Hew York, beyond the sum received by hito therefor, from the corporation of that city.

The following are substantially the facts set out in the complaint: Prior to October, 1853, a private association in the City of Hew York, of the same name as the defendants, and of which the plaintiff was a member, owned a railway laid down in the Third Avenue. Such association appointed a committee, of whom- the plaintiff was one, to prevent obstructions on the road. The officers of the city corporation awarded to a Mr. Benjamin, who was one of such association, in June, 1853, a contract for building a public sewer under such railway, and the association passed a resolution “ to have such sewers constructed on the most favorable terms to themselves, and “ to pay "any deficiency in the cost of such work, above “ what the corporation might agree to pay.” Benjamin failed to give the necessary security, and the plaintiff, by the authority of the rest of the associates, made a contract with such corporation to construct the sewer, and such associates agreed with him, to reimburse him his actual expense of so constructing it, with a reasonable sum for his services, less the amount to be received from the city corporation, and “ he agreed, not to obstruct the running of “ their oars during ihe work.” The plaintiff commenced the construction of such sewer in July, 1853. The defendants were incorporated in October following. On the day of their incorporation the members of such association,-and other persons interested in such railroad, as parties thereto of the first part, and the defendants, by their corporate name as parties thereto of the second part, executed an instrument under seal, by which agreement the. parties

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thereto of the first part sold to the parties thereto of the second part, for upwards of a million of dollars, a grant from the Oity of New York to certain of such associates, made in January previous, and the railway constructed by virtue of such grant, with the appurtenances, except certain real and personal estate, subject to the terms and stipulations of such grant, which the parties thereto of the second part covenanted to perform, and subject also to the payment of all the money which such association had resolved to pay on account of the beforementioned sewer, and also to other burdens; as to all of which there was no covenant to pay. The plaintiff completed the sewer in Atigust, 1854. During its progress, and before it was completed, the defendants requested him to remove earth thrown upon the railway during its construction, and promised to pay him all sums expended by him in building such sewer and keeping the track clear, with a reasonable sum for his services, less the amount paid by the city corporation. The complaint, after alleging these matters, then set forth the amount of the plaintiff’s expenditures in building such sewer, alleged what was a reasonable sum for his services, admitted the receipt from the city corporation of a certain sum, and demanded judgment for the-residue.

The answer of ..the defendants controverted the amount alleged in the complaint to have been expended in constructing the sewer mentioned therein ; it denied the making of any such agreement with the plaintiff, by the partnership as is therein alleged, and alleged that he agreed to waive all claim against it, and to receive the contract price as full compensation; it denied that the defendants required the plaintiff to remove the earth from such sewer, as stated in the complaint, and that they agreed to make up to him the deficiency in the contract price. It alleged that the plaintiff did not complete such sewer until November, 1854, and did not perform his contract according to its terms, and did unnecessarily obstruct the cars in passing on such road. It also set up, by way of counter

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claim, damages from the non-completion of such work in ninety days. • It also claimed that seven hundred and fifty dollars of the amount expended by the plaintiff was paid to the City Inspector for the time of constructing the sewer, which was unnecessarily long; and alleged other damages and expenses to the defendants, by reason of such unnecessary delay, which it claimed to set off. It also interposed a set-off for goods sold and delivered by the defendants to the plaintiff, and also an indebtedness from the partnership mentioned in the complaint to the defendants for money lent, and that the payment of such indebtedness was, by agreement, a condition precedent to the performance of the agreement under seal, set out in the complaint, of both which facts' it averred the plaintiff had knowledge.

The answer set up a separate and further defense in its seventh paragraph; in which the defendants alleged “ that “the partnership (before spoken of) were never legally “ bound to pay the plaintiff any money for the construction “ of such sewerthat the contract with him, or any note thereof in writing, was not signed by the association; that there was no consideration for it; that the sewer was constructed for the corporation of the City of Hew York, and the payment for it was solely their debt.

A reply was put in by the plaintiff to the defendants’ answer, which denied unreasonable delay by him in performing the contract, and any damage thereby to them, and any indebtedness by the plaintiff to them, as alleged in such answer, and alleged that any delay by the plaintiff was permitted by the original partnership, and was for their benefit.

* Ho issue was formed on the matters contained in the seventh paragraph of the answer, by any subsequent pleading.

The issues in the action were ordered to be tried by a Referee; and on thé trial, the contract between the plaintiff, the corporation of the City of Hew York and its Croton Aqueduct Department, made in June, 1853, for the build-

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ing of a sewer from 49th to 53d street, in such part of the Third Avenue as that Department should direct, was put in evidence.

By the contract the work was to be begun in July following, and completed in a hundred days, exclusive of holidays, and any other time during which its prosecution was suspended, according to such agreement. It contained, also, a provision that in case of the failure of the work to advance according to the agreement, so as, in the opinion of the Aqueduct Department, to be unnecessarily delayed, that Department was to have the right to carry on the work, deducting the expense from any money due to the plaintiff. The only part of the work, for the suspension of which, provision was made therein, was the masonry, which was to last from the 1st of December as long as the Aqueduct Department should think proper.

. The shape, size, materials, workmanship, direction and finish of the main work, with its appurtenances, were fully detailed in the contract. It provided, also, for the support of gas and water pipes, and the deposit of them and gutters, also of stones, rock, sand and earth, during the work, and removing the latter when the work was completed; also for the size of the trenches, and the length of their sections in advance of building the sewer; the street-piling and refilling, and the subsequent repairing and regrading the surface of each section as completed, and immediate removal of the earth, sand and rubbish therefrom.

The plaintiff, in and by the contract, agreed “ to preserve “from obstruction all rail tracks which might be affected by “the prosecution of” such “work, and also to afford the “ necessary facilities to the companies owning them, or to “ their agents, in their preservation of the same from injury, “ without extra charge therefore

On the trial a witness, examined on behalf of the plaintiff, testified “ that it was part of the understanding and “agreement” of the association with the plaintiff, made simultaneously with their promise to reimburse his expen

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ditures on the sewer in question, “ that more time would “ be required to construct it than was given him in the “corporation contract, but he was to do it in the shortest “possible time, ajst> in such a way as not to interfere with “or interrupt the running of the railroad cars.” On a motion to dismiss the complaint, made afterwards, one ground urged was that such a contract violated public policy..

On the trial it was admitted that subsequently to the date £>f the transfer of the railway and its appurtenances to the defendants, their superintendent gave the plaintiff, while carrying on the construction of the sewer, directions about carting away dirt and keeping the track clear, and their president told the plaintiff “it would make no dif“ference to him as the defendants would have to pay him “for building the seiver,” &c.

Several witnesses examined on the trial differed as to the time necessary for the building of such sewer; it actually took over a year for its completion. Some evidence was also given as to the increase of the labor of the plaintiff in consequence of his efforts not to interrupt the running of the cars. A question, to an expert, as to “ whether the “laying of the tracks and operating on the road in this “case were necessarily obstructions to the building of the “sewer,” was excluded. The plaintiff, however, testified that the increased expense to him was caused by his being obliged to cart away dirt and bring ifc back, to prevent its interrupting the cars.

The Referee, in his report, did not pass upon the existence of any promise of the defendants to pay the plaintiff, other than that supposed to be made by the instrument of October, 1853. His report was also silent as to- there being any difference of time in building the sewer, by reason of the means used to prevent any obstruction of the running of the railway cars of the defendants, or in the disturbance of the highway thereby, for a longer time than that fixed in the corporation contract, or there being

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a disturbance of the highway as long as the sewer was in the course of construction.

Among the facts, however, found by the Referee’s report were the following:

First. An understanding between the plaintiff and the association, contemporaneous with their contract, “That “ more time would be required for building the sewer in a “ manner consistent with the interests of such association, in “ using such road, than was fixed by the city contract.”

Second. An agreement between the same parties, that the plaintiff should finish the work “in as short a time as “possible, but so as not to interrupt the running of the “ cars.”

Third. Knowledge of the work, during its progress, by the agents and officers of the defendants.

Fourth. A direction to the plaintiff by the superintendent of the defendants, during the progress of the work, to cart away dirt, and a knowledge by the President of the defendants of such direction.

Fifth. The absence of any complaint by the association or the defendants, of the work, or any delay in completing it.

The Referee applied to such facts, among others, the following principles or conclusions of law:

I. The agreement between the plaintiff and the association, mentioned in the complaint, did not violate any principle of public policy.

II. The defendants became bound to perform such agreement by the instrument of October, 1853.-

III. The defendants were also so bound by perceiving, without dissent, the action of the plaintiff,' in constructing the sewer in question.

The defendants filed exceptions to such report, both for its finding certain facts, and its omission to find others, as well as the principles of. law applied to such facts in the report.

Judgment was entered in favor of the plaintiff for the amount found due by the Referee, being for the excess of

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his expenditures beyond the contract price, from which judgment the defendants appealed to the General Term.

Charles O’Conor, for the defendants, (appellants.)

I. There was ño privity of contract between the corporation and the plaintiff. His claim, if any, is against the partnership.

II. The alleged agreement between Dingeldein and the partnership was a conspiracy to violate the law. 1. One feature of it was that, by deceit of the public authorities, the job should be awarded to the plaintiff, at a compensation higher than that specified in the lowest bid. 2. The alleged agreement contemplated the disturbance of the Third Avenue, for a long period, merely to subserve the private interest of the Railroad Company, a. Public highways are merely for passing and repassing. Any other use, without express license from competent authority, is a public wrong. (Davis v. The Mayor, &c., 4 Kern., 524; Dovaston v. Payne, 2 H. Black., 527; S. C., 2 Smith’s Leading Cases, 90, 28 L. Lib., N. S.; Rex v. Cross, 3 Camp., 226; Rex v. Jones, 3 Camp., 230; 2 Rolles Abr., 137, Nuisance B.; 3 Bac. Abr., 497, Highways E.; Commonwealth, v. Passmore, 1 Serg. & R., 219 ; King v. Russell, 6 East, 427; Rex v. Carlile, 6 Car. & Payne, 636; People v. Cunningham, 1 Denio, 524 ; 14 Conn., 317 ; 6 Barn. & Cress., 566; 1 Dall., 150 ; Fowler v. Sanders, Cro. Jac., 446 ; 3 Com. Dig., 27, Chimin A, 3.) b. A contrivance by private individuals to prolong, for their private advantage, the time of the disturbance caused by the public work, was a trespass on public right, and a violation of public policy.

III. All agreements to violate law, or to contravene the legitimate policy of the government, are vicious, and no right can accrue from them. (Bell v. Leggett, 3 Seld., 176; Spinks v. Davis, 32 Mississippi R., 152; Broom’s Maxims, 349, 50th Law Lib., 222; Merryweather v. Nixan, 2 Smith’s Leading Cases, 297, and note; 2 Kent’s Com., side paging 466, 467, and notes; American Jurist, (Boston,) vol. 22, pp.

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266, 270; Bartle v. Coleman, 4 Peters, 188; 3 T. R. 552; Satterlee v. Jones, 3 Duer, 116 , 117; Wall v. Charlick, N. Y. Leg. Obs., vol. 8, p. 230; Cunningham v. Cunningham, 18 B. Monroe, 19; Sumner v. Brady, 1 H. Bl., 655; Hatch v. Mann, 15 Wend., 45 ; Gray v. Hook, 4 Comst., 454; Davison v. Seymour, 1 Bosw., 92 ; Eddy v. Capron, 4 Rh. Isl., 394; Ingram v. Ingram, 4 Jones N. C. Law, 188; Greene v. Godfrey, 44 Maine, 25; Bellows v. Russell, 20 New Hampshire, 427.)

IV. The alleged agreement was manifestly illegal, and therefore the judgment should be reversed.

John W. Edmonds, for the plaintiff, (respondent.)

I. The liability of the defendants depends on the following considerations: 1. Their contract of 8th Oct., 1853, to pay all the money which the partnership were, by a resolution, bound to pay; 2. The resolution of the partnership of 21 June, 1853, that any deficiency in the cost, over and above what the corporation pay, shall be paid by them; 3. The evidence that the bid of plaintiff was for the partnership; 4. The bids themselves; 5. The surrender of Benjamin’s bid, and the falling back on plaintiff’s, which was for the partnership; 6. The agreement of the partnership to make plaintiff whole; 7. The agreement of the defendants, after the transfer to them, to make him whole; 8. The recognition by the defendants while the work was going on; 9. The acquiescence of the defendants in such liability, and their giving directions as to the work, in, reference to their convenience, and not plaintiff’s, and to the increase of cost to plaintiff.

II. Under such circumstances, the plaintiff could recover even though there had been no privity of contract between him and the defendants, or any consideration passing from the plaintiff to the defendants. (2 Pars, on Cont., 303, and notes i. m.; Ib., 308; notes v. and w.; Barker v. Bucklin, 2 Denio, 45 ; Cumberland v. Codrington, 3 Johns. Ch. R., 254; Farley v. Cleveland, 4 Cow., 439 ; S. C., in error, 9 Id., 639; Schermerhorn v. Vanderheyden, 1

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Johns. R., 139; Del. & Hud. Canal Co. v. Westchester Bank, 4 Denio, 97 ; Lawrence v. Fox, 20 N. Y. R., 268; 1 Story on Cont., § 451; Hall v. Boardman, 27 Barb., 82 ; Bohanan v. Pope, 42 Maine R., 93; Taplin v. Packard, 8 Barb., 220 ; Phillips v. Berger, 8 Barb., 527 ; Forman v. Stebbins, 4 Hill, 181 .)

III. But, in this case, there was privity of contract between these parties, and a consideration moving from plaintiff and defendant. The work was, by defendants’ order, done so as to be more expensive to plaintiff, and beneficial to defendants. (1 Story on Cont., § 450; Wilson v. Coupland, 5 B. & Ald., 228; Tipper v. Bicknell, 3 Bing. N. C., 710; Webb v. Rhodes, 3 Id,, 734.)

IV. Under the Code, the action can be brought by the plaintiff as the real party in interest. (Code, § 111; Grinnell v. Schmidt, 2 Sandf. S. C. R., 705; Savage v. Bevier, 12 How. Pr., 166 .)

Although what the plaintiff, by the terms of his agreement with the association mentioned in the complaint, agreed with them to do, was to furnish certain materials and do certain work, that work was not of a kind they could have given him authoity to do, nor was it peculiarly for their benefit, nor did the structure thereby produced become their property, or pass into their possession; the association did not even agree to pay him either a fixed price or the reasonable worth of the work and materials. His entering into a separate contract to do such work for those who could authorize him to do it, and whose property the sewer became when finished, although at the request of the association, could only raise an implied obligation to indemnify him; and, as an express agreement was made to do so, as well as a previous request to him to do it, it placed him precisely in the position of a mere agent, deriving no personal benefit from the agreement, except the stipulated compensation for his services in superintending the work. That position excluded the application of any rules of law which might create a liability out of mere work and labor, undertaken at the

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request of one person, which benefited another, and was directed and accepted by the latter, and also took the case out of the statute of frauds.

It is claimed, however, on the part of the defendants, that such agreement was illegal, because it was accompanied by a condition that the plaintiff, in doing the required work, was not to interfere with the running of the cars on the railway, and also an understanding or expectation that more time than was allowed by the corporation contract would be required to complete such work “ in a manner consistent with the interests of the association in using such road,” and this too, notwithstanding such securing the use of the road, was not established to have necessarily prolonged any disturbance of the highway, and although there was no evidence to show that consulting the interests of such association prolonged the time necessary for doing the work.

Such a condition, if .illegal, undoubtedly would infect the contract by rendering the consideration for the defendants’ promise a contract which violated public policy; and nothing could save the undertaking to indemnify the plaintiff, but an abandonment of the illegal contract, and the formation of a new one, excluding the illegal promise which formed the consideration. The first question, therefore, is, whether such promise was illegal; it was if it amounted to an agreement to obstruct the highway, either without authority, for an illegal purpose, or for a longer period than was necessary. (Dygert v. Schenck, 23 Wend., 446 ; The People v. Cunningham, 1 Den., 524 ; Same v. Lambier, 5 Den., 9 , and cases cited by counsel for defendants; Renwick v. Morris, 3 Hill,. 621 ; S. C., 7 Hill, 575 .) The times and places of constructing sewers, vaults and drains, are entirely under the control of the corporation of the City of New York, (Wilson v. Mayor of New York, 1 Den., 595 ,) and no one can lawfully interfere with the public streets, for such purposes, except by their authority. In addition to this objection of illegality, it is claimed there is another which vitiates the contract in question, because

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the plaintiff not only agreed, in order to benefit such association, to disturb the highway longer than was allowed by the corporation contract, but also to violate the terms of that very agreement as such. I apprehend that the part of the latter, which consists of the plaintiff’s undertaking, is a mere private contract, the violation of which subjects him to damages therefor, either generally or according to the terms of such agreement, and that it is no more sacred than any other contract for work and labor between private individuals; it may, therefore, be laid aside in considering the validity of the agreement in question.

If, however, this be an agreement to disturb the public highway longer than was lawfully authorized, so as to promote the interests'of the association at the expense of the public, it is invalid. (Merryweather v. Nixan, 2 Smith’s Lead. Cases, 297, and note; Gray v. Hook, 4 Comst., 454; Bell v. Leggett, 3 Seld., 176; Davison v. Seymour, 1 Bosw., 92 .) Objections are, however, raised to the application of this principle, arising as well from a defect of evidence, as from its insufficiency to sustain the form of the Beferee’s finding; and arising even from the pleadings.

The defendants have only alleged in their answer generally that the original agreement was. illegal, and in the same paragraph proceed to enumerate certain legal reasons why it was void, such as being a collateral undertaking and not in writing, and as being without any consideration by reason of the contract with the corporation; the whole, apparently, stated as one defense. I do not understand that a general allegation that a contract was illegal would enable a party to prove every fact that might make it so; it is rather the averment of a legal result than a fact, and the enumeration of legal objections in the same paragraph would seem to be an explanation of what was meant by such illegality. The Code requires defenses to be separately stated, (§ 150.) When so stated they are to be treated as separate pleas would under the old system. (Cobb v. Frazee, 4 How. Pr., 413 ; 3 Code R., 43.) The

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paragraph in question could clearly, under that system, only amount to a plea of the special matters set up in it.

But it was contended that if the contract could not be proved, without proving the whole of it, including the illegal part, such illegality could be taken advantage of, without pleading it; but I am unable to understand why. The defendant could not truly deny the making of the contract set out in the complaint, if made, and he must either set up the illegality or allow a default. If he untruly denied the making of the contract as set out, that should not enable him to avail himself of the accidental fact of the illegality appearing in the testimony. If the plaintiff could not set out the contract, without showing its illegallity, advantage might be taken of it on demurrer, and pleading other matters would possibly not deprive the defendants of the right of moving to dismiss the complaint on that ground; but it would certainly be a novelty to allow, in an action on a promissory note, under an answer denying its making, proof of usury, or that it was given for money lost at play, or any other illegal consideration, without any allegation to that effect in the pleadings.

But even if such illegality were set up in the answer, or the parties had tacitly agreed, by admitting testimony, to try the question, the Referee’s statement of the understanding, on which the defendants rely as making the contract in question illegal, is not borne out by the testimony. That proves that the parties thereto understood, which amounts to no more than that they expected, that it would take longer to build the sewer than was allowed by the corporation contract, which might very well be, without affecting the agreement with the plaintiff; and they only added that the plaintiff was to do it in the shortest possible time, and in such a way as not to embarrass the use of the road; both perfectly legitimate agreements, and the last substantially contained in the corporation contract. As it turned out, it did take longer than the contract time, and such deviation was ratified by the city authorities, who paid the plaintiff for his work. The Referee, however,

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in his finding annexes to the expectation of the parties, that the time in the corporation contract would not be sufficient, a qualification which does not appear at all in the testimony, viz., its being done in a manner consistent with the interests of the association in using the road, and he also, by using the exceptive particle “ but,” clogs the undertaking of the plaintiff to do the work as soon as possible, with the condition that he was to so do it as not to interrupt the use of the railway; while, according to the testimony, that was only an additional stipulation, producing a manifest distinction, so far as the question of illegality is concerned.

There may be a wide difference between the time to be occupied in completing a given work, when it is conducted so as not to prejudice other interests, and when it is conducted without regard to them; and this is equivalent to a certainty, in its effect on a contract,, when it is assumed by contracting parties to exist. But even the understanding, as stated by the Referee, might not make the contract illegal, for tile plaintiff’s corporation contract requires him to preserve all rail tracks from obstruction, and gratuitously afford facilities for their preservation ; this was as incumbent on him as to build the sewer at all; and he had no right to neglect such obligation, merely in order to finish it by the appointed time; if, by observing it, he exceeded that time, it was a matter of which the city authorities were to avail themselves, and exact the penalties provided for in the contract; or they might, as they actually did, extend the time; so that even if the understanding were as stated by the Referee, it would not avoid the original agreement.

The testimony, however, narrows this point still farther; it simply establishes an understanding that the sewer would require a longer time for building than was specified in the plaintiff’s contract; but that he should build it as soon as possible, and so as not to stop the running of the cars, a perfectly innocent undertaking, and not tainting any agreement with illegality; A knowledge by both

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parties that the plaintiff had undertaken an impossibility, and an agreement that he should carry out his obligations as nearly as he could, and without injury to the association, coiild hardly be perverted into anything unlawful. The result shows that these expectations were not unfounded, and there is no evidence that any one was prejudiced by the parties’ agreement.

So far as regards the question of illegality, the Eeferee was therefore correct in his conclusion, for the reasons already stated; but a more serious question arises, which was presented, but not fully argued, by the counsel for the defendants, as to their liability in any way for the contract of the association. The Eeferee places such liability, first, upon the written instrument of assignment of October,

° 1853, and their omission to dissent, while they were continually acquainted with the plaintiff’s work on the sewer and the neighboring street. The facts he relies on to sustain such conclusions are, the knowledge by the defendants of the plaintiff’s work as it progressed ; the presence of their officers on the road during that time ; the direction by then Superintendent to keep the track clear; the knowledge by the President of such direction, and the failure either by the partnership or the defendants to complain of such work or any delay on it.

The plaintiff’s construction of the sewer was under a contract with the city corporation, by their authority, and to be paid for by them, and the sewer became their property when completed; the defendants could not have legally interfered with such construction; the plaintiff was not their agent, had made no contract with them, and any objection on their part would have been perfectly idle; if-they had made it, and the plaintiff had stopped work in consequence, he would have been liable for all the penalties of his contract with the corporation officers, without any right of indemnity from any. one. Their silence, therefore, is not such an acquiescence as to create a liability on their part to indemnify the plaintiff, any more than the silence of any person owning property in the neighbor

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hood. The misapprehension of law involved in the report arises from confounding the relations of the parties with those which might arise from the performance of work for the partnership, accepted by the defendants and beneficial to them; whereas the work was performed by an agent of the partnership for a third person, under a promise by the firm to indemnify him for loss, and the defendants had no right to interfere either to accept or reject it, and the benefits were no greater to them than to a thousand others. Under such circumstances nothing but an entire novation of the contract to which the plaintiff, defendants and partnership should be parties, or a new promise by the defendants, for a new consideration, would make them liable.

I apprehend the assignment by the partnership to the • defendants of property in October, 1853, could not operate as such a novation, because the plaintiff was not a party to it, and did not assent to any substitution of the defendant, as his debtors, in place of the partnership. So far as it contains any stipulations by -the defendants, it is under seal, and any action could only be on such stipulations as covenants in their name, as they are the parties interested. It is true that if such instrument contained words implying an undertaking by the defendants to pay the money due the plaintiff, the case would come within the language adopted by Judge Comstock, in the case of Belmont v. Coman, (22 N. Y. R., 438,) and the acceptance of the transfer with such words would raise a promise; but it does not, and only has the same expression as that contained in the conveyance discussed in that case,-which was held not to impose a liability on the grantor; the property is conveyed subject to the payment of certain sums, and the covenants in the grant or lease assigned’by the instrument in question are expressly thereby assumed; while this payment, and all others mentioned therein, are not. What redress the partnership might be entitled to under such instrument, for the failure of the defendants to pay the plaintiff his claim, is immaterial; it is sufficient

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that it does not profess to give the plaintiff any rights, and that he cannot sue upon such instrument. The money due the plaintiff was not a lien upon any of the property transferred, but was entirely collateral; a transfer so made subject to such a payment, may thereby become conditional, or the sum may be part of the purchase-money, which the vendors may have a right to recover in case they have paid it, but it cannot create a contract directly between the vendees and the plaintiff, who was a stranger to, the assignment.

The complaint, it is true, alleges that by such assignment the defendants became possessed of the property mentioned therein, and agreed to pay to the plaintiff the amount agreed to be paid him by such partnership. That allegation, if not controverted in fact by the first paragraph of the answer, is a mere averment of the legal consequences of the agreement, and not of a separate and independent promise; it does not even contain any statement of any consideration for such separate promise.

There is, however, a statement in the complaint of a requisition by the defendants of the plaintiff to remove earth taken from the sewer to a great distance, and a promise thereupon by the former to pay the latter all sums expended by him in building such sewer, and keeping the track clear, as well as for his services above the amount paid by the city, both of which facts are denied in the answer. The Eeferee has not passed upon the issue so made, except as to request to cart away dirt, which he has found as a fact. The plaintiff testified that he was put to extra expense in carrying away such dirt, and it was admitted that this was done by direction of the defendants’ Superintendent, and that their President “then said to the plaintiff, it would make no difference to him ‘ as the defendants would have to pay for building the ‘ sewer.” The Eeferee does not find, from that evidence, any promise, and puts the liability of the defendants on a different ground, to wit, the assumption by the instrument of October, 1853; nor does he find whether the work so

p. 96

done by the plaintiff came within the terms of the agreement by him with the city officers"; particularly the clause “ requiring Mm to preserve from obstruction the rail tracks, “affected by the prosecution of the work therein described” If it did it would not form the foundation of a new promise, as the corporation and the partnership would be already liable for that. It must, therefore, be referred back, to enable the plaintiff, if he can, to prove the extra work and the separate promise, or if not the latter, to recover the value of such extra work. ' , .

I have not deemed it necessary to discuss the point of illegality in regard to the offers to the city officers to do the work; the only object of requiring such bids was to protect the city; any agreement, undoubtedly, between competitors, not to bid, or to withdraw their bids, so as to prevent competition, would be subject to the same objection as if it were a public auction. But there is nothing to prevent any separate or joint contractors from making several offers, and withdrawing any they pleased, which is the most contended for here, all the bids being put in by the agents of the partnership at different rates, they retained the most favorable one. But in fact the testimony does not establish any arrangement before putting in the bids, and the lowest one was allowed to expire by not giving security. Uo facts constituting such illegal arrangement, and no illegal arrangement, was found by the Referee.

But for the reasons before given, the judgment must be reversed and a new trial awarded, with costs to abide the event of the action.