Wise v. Chase — 26 N.Y. Super. Ct. 35

Majority

p. 35

Abraham Wise and others, plaintiffs and respondents, vs. Hezekiah S. Chase and others, defendants and appellants.

Headnote

1. The acceptance of vouchers or certificates of a government officer for goods received for the use of government, of the same amount as the value of merchandise sold hy vendors to persons in whose favor such vouchers are issued, under an agreement hy the latter to deliver similar certificates to such amount, and a written receipt therefor given by such vendors, expressly stating such receipt to be “ in payment of bill of goods,” will not so extinguish all claim for the price of such goods as to preclude the vendors from recovering so much thereof as shall be equal to any amount which government officers shall afterward legally deduct from the amount certified to in such vouchers, with the assent of such vendees.

2. A finding by. a referee, in such case, that vouchers were not delivered in payment and satisfaction of the demand of the plaintiffs on account of the sale and delivery of the goods, is fully justified by the evidence.

3. The government not having recognized the vouchers for the amount named therein, but only for about $6000; Held that the defendants had not complied with their agreement to furnish vouchers for the amount of the plaintiffs’ bill of goods.

(Before Moncrief, Garvin and McCunn, JJ.)

Heard December 12, 1864;

decided December 31, 1864.

Appeal from a judgment entered upon the report of a referee. The action was brought to recover a balance of $2444.31, claimed to be due for goods alleged to have been sold and delivered by the plaintiffs to the defendants, in January, 1862— the total of the amount alleged to have been sold being $8624. 67. The defense was, that the goods were bought to fulfill, in part, a contract to furnish goods to Governor Robinson, of Kansas, and were to; be paid for in vouchers to be issued by the governor’s quartermaster, for goods delivered and accepted under such contract, to the amount of $8624.67, and that they were so paid for. One Wheeler (prior to the transaction in question) had entered into a contract with Governor Robinson, of Kansas, to furnish goods to the government. This contract had been assigned by Wheeler to the defendants, and the defendants had been recognized by the government as the actual-contractors. At the time of the transaction in question, the defendant, McKinny, who conducted it on behalf of the de-

p. 36

fend ant, and negotiated and made with the plaintiffs whatever bargain was made, exhibited this contract to the plaintiffs. These goods were bought to be delivered in part performance of this contract. This the plaintiffs knew at the time. The agreement under which the goods were sold and delivered, was as follows:

“ Hew Yoke, January 27, 1862.

Having .this day purchased of Wise & Arnold six thousand gray flannel over shirts, at $11.75 per dozen; six thousand Canton flannel drawers, at $5 per dozen ; two hundred overalls, at $5.50 per dozen; and two hundred jumpers, at $5.50 per dozen; we do hereby agree to deliver to said Wise & Arnold Governor Robinson’s vouchers, by his quartermaster, within a few days after the arrival of said goods at their destination, at jSt. Louis, for the amount of said goods.

(Signed,) • Chase, McKinney & Co.”

The referee refused to admit evidence, on behalf of the defendants, of any agreement between the 'parties in relation to the mode or medium of payment, other than the above paper, or to admit evidence of any thing said between the parties at the time that paper was executed.

. The referee found the following facts, viz : That the plaintiffs, on or about the 27th day of January, 1862, at the request of the defendants, sold and delivered to them, at St. Louis, divers quantities of merchandise, at prices agreed upon, amounting in the aggregate to the sum of eight thousand sik hundred and twenty-four dollars and sixty-seven cents, (8624.67.)

2. That the defendants agreed to deliver to the plaintiffs, within a few days after the arrival of said goods at their destination, at St. Louis, Governor Robinson’s vouchers, by his quartermaster, for the amount of said goods, and did deliver said vouchers.

3. That the said vouchers were not delivered in payment and satisfaction of the demand of plaintiffs against defendants, on ■account of the sale and delivery of said merchandise. They consisted of a bill of défendants against the United States government for goods charged at higher prices than were al

p. 37

lowed by the government. The vouchers were rejected by the government, but a sum of $6000 was allowed thereon, and received by the defendants, and by them paid over to plaintiffs.

4. That the defendants have returned to plaintiffs a portion of the said merchandise, amounting, at the prices agreed upon, to the sum of $183.33, and have paid to plaintiffs, on account of said sale and delivery, the sum of six thousand dollars as aforesaid, but that no further or greater sums on account thereof had been paid.

And the referee found, as matters of law, that the defendants were indebted to the plaintiffs (after allowing the said payments of $183.33 and $6000,) in the sum of twenty-eight hundred and seventy-six dollars and fifty-five cents (2876.55,) said sum including interest, and that the plaintiffs were entitled to judgment for that sum, with costs. "

Titus B. Eldridge, for the appellants.

I. If exhibit A is to be regarded as necessarily expressing the entire contract between the plaintiffs and defendants, and as well that relating to the time and medium of payment agreed upon, as that relating to the price of the goods, then the judgment is clearly wrong. This paper, viewed as embracing the entire contract, imports that payment was to be made for the goods by delivering to the plaintiffs “ Governor Robinson’s vouchers, by his quartermaster, within a few days after the arrival of said goods at their destination at St. Louis, for the amount of said goods.”

II. If the written agreement does not necessarily import that these vouchers were to be delivered and received as payment, and that the plaintiffs, after receiving them, were to look solely to the government, and if there be nothing in the legal import of this paper which precludes either party from showing by parol how the goods were to be paid for, then the referee erred in excluding the evidence offered by the defendants on that point. The. answer alleges that payment was “ according to an agreement made between the plaintiffs and defendants at and prior to the sale,”' to be made “ by delivering to said plain

p. 38

tiffs the said vouchers.” The referee excluded evidence offered by the defendants to prove that such an agreement was in fact made. In this he was clearly wrong, unless the written paper contains the contract, as to the manner in which payment was to be made, with such precision and exactness as to exclude all parol proof in reference to that question. • And if the paper contains the entire contract, then it is clear that it was agreed they should be thus paid for.

III. The complaint states that the agreement was that the defendants should pay “ in proper and valid vouchers.” The written contract declares by whom the vouchers arre to be issued. It imports nothing as to their validity, except that they shall be issued to and received by the defendants, in good faith. No fraud, misrepresentation, or bad faith is imputed by the evidence, either to the quartermaster in issuing, or to the defendants in obtaining, these vouchers; so that if the plaintiffs actually received them as payment, the judgment is for that cause erroneous. The vouchers delivered were accepted as being in all respects such as the defendants had contracted to furnish. The referee finds that the defendants “ did deliver such vouchers"—meaning thereby such vouchers as they had agreed to deliver.

IY. The referee, although he has found that the defendants did deliver such vouchers to the plaintiffs “ for the amount of said goods,” yet further finds “ that the said voúchers were not delivered in payment and satisfaction of the demand of plaintiffs against defendants, on account of the sale and delivery of said merchandise.” This finding of fact is excepted to. The plaintiffs, on the delivery of vouchers to them, gave a receipt, which stated that they had received these vouchers “ in pay- • ment of bill,” of the goods in question ; and the plaintiff, Wise, so testified. Rushmore and H. A. Gouge testify to the same fact. It is therefore clear, on the evidence actually givén, that these vouchers were delivered and accepted as payment.

Y. The whole evidence shows very clearly a perfect understanding between the plaintiffs and the defendants, that a delivery of these vouchers to the plaintiffs satisfied all liabilities

p. 39

of the defendants to them; and that after such delivery was made and accepted, the plaintiff’s only resource for ultimate payment was to the government.

VI. It is therefore confidently submitted, that the judgment is clearly wrong. The written agreement is an absolute contract to accept the vouchers as payment. If the defendants can be mistaken in this view, then it was manifest error to exclude proof of an agreement, in fact, outside of the paper, to take them as payment. And it is entirely clear that they were delivered and accepted as actual payment.

S. P. Nash, for the respondents.

I. The alleged vouchers were never obligations of any kind whatever. They were simply the defendants’ bills rendered to the government, at prices which the government did not allow. The receipt, therefore, given the plaintiffs, did not .conclude them. It was based upon, and assumed, good faith on the part of the defendants, whereas the “ vouchers ” were, like bank checks, drawn for a larger amount than the drawer has in bank. The obligation of a third person received in payment may conclude the creditor, though it fail to produce the amount for which it is taken ; but the debtor cannot discharge his liabity by his own checks, notes, or mere paper devices, unless they are good for what they profess to be, no matter how strong a receipt he persuades the creditors into giving. (Hill v. Beebe, 3 Kern. 556. Higby v. N. Y. and Harlem R. R. Co., 3 Bosw. 497 . Hendrickson v. Beers, 6 id. 639 .)

II. The subsequent dealings of the defendants, as shown by their own testimony and correspondence, fully justified the finding of the referee, that the vouchers were not received in payment, and the question was one of fact, purely. (Torry v. Hadley, 27 Barb. 192 . Noel v. Murray, 3 Kern. 167. 1 Duer, 385 .)

III. None of the exceptions of the defendants are well taken.

IY. The report was in accordance with the equity of the case as well as the law, and the judgment should be affirmed, with costs.

It is not disputed that the plaintiffs sold to the defendants goods to the amount of $8614; and that after deducting all payments, and goods returned, there remained a balance due of $2441.34, for which.the plaintiffs have not been paid, and the defendants are liable,' unless' the terms of the contract and subsequent acts of the parties show payments or discharge the defendants from liability. The sale was-made by a writing dated Eew York, January 27, 1862* viz : “ Having this day purchased of Wise & Arnold (enumerating the articles with prices) we do hereby agree to deliver to said Wise & Arnold, Governor Robinson’s vouchers, by' his quartermaster, within a few days after the arrival of said goods at their destination at St. Louis, for the amount of said goods.

Chase, McKinney, & Co.”

■ Vouchers were delivered to the plaintiffs by the defendants, amounting to the sum of more than eight thousand dollars, and a receipt was.given by the plaintiffs, which acknowledges the receipt of “ Governor Robinson’s quarter master’s vouchers to the amount” specified, “inpayment for bill of goods,”' of such a date. These vouchers were simply certificates, or receipts that the goods had been received for account of the United States, from the defendants, hut were not, in any sense, obligations to pay. Afterwards a deduction was made by the government commissioners and the vouchers cut down to the sum of $6000, for which the defendants had a warrant upon the United’ States treasury, which was indorsed over to the plaintiffs, and they received the money, leaving the sum claimed in this action unpaid. The referee reported in favor of the plaintiffs for the amount claimed, with interest; upon which judgment was entered* with costs. The defendants appealed.

• Th'e important question to he considered is, whether the ¿cceptance of the vouchers by the.plaintiffs, and the receipt given by them to the defendants, extinguished the plaintiffs’ demand as against the defendants. There is no question that the plaintiffs had the vouchers, and sent them on.to Washington to the quarter master general; who appointed a commission to. examine the claim and reduced it. On the trial the referee

p. 41

found “ that the said vouchers were not delivered in payment and satisfaction of the demand of the plaintiffs against the defendants on account of the sale and delivery of said merchandise.” I think this finding is fully justified by the evidence. 1. There is not any thing in the contract of sale to show that the vouchers were to be received by the plaintiffs in payment; but it simply provides that vouchers are to be delivered for the amount of said goods. 2. Ho money could be obtained from the government on the vouchers merely. It was necessary they should be presented, audited and a warrant drawn upon the treasury by the proper officer, payable to the order of the defendants, without whose indorsement the money could not be drawn. This is the common and ordinary mode of business with the United States. Thus it is seen the vouchers were not obligations of any kind, either against a corporation, an individual, or the government. Again, the receipt taken in its broadest sense, was open to explanation; and however strong its terms (in a transaction of this description) would not conclude the plaintiffs. The vouchers did not represent the amount the government would pay, for it turned out that they were only for about $6000 ; in other words, the government only recognized them for that amount. It may therefore be said, that the defendants did not furnish vouchers for the amount of the plaintiff's bill of goods, as in their contract they were bound to do, but only for a part thereof; they had the form without the substance. A payment in genuine bank bills of a bank which has failed is a nullity, and will not discharge the debt, although neither party may know of the failure. (Thomas v. Todd, 6 Hill, 340 .) Both parties, when the receipt in this case was given, may have supposed the vouchers would be taken by the government as the proper evidence of the amount for which the claim of the defendants would be audited and a warrant issued therefor, but it turned out otherwise, and the vouchers were rejected and repudiated, and Commissioners fixed the amount to be paid. The justice of this case is clearly with the plaintiffs. The defendants had their goods, and are bound to pay for them. We think the findings of the referee

p. 42

were justified by the facts disclosed in the case. The several objections and exceptions taken by the defendants are untenable. The judgment should be affirmed, with costs.

Cases cited

Higby v. New York & Harlem Railroad 3 Bosw. 497 N.Y. Super. Ct. 1858-10-09 p. 39
Torry v. Hadley 27 Barb. 192 N.Y. Sup. Ct. 1858-05-17 p. 39