Lewis v. Sawyer

Tenney, C. J. The writ was originally against the defendant and Levi Sawyer, as copartners, under the firm name of Levi Sawyer & Son. Levi Sawyer died, and the writ was amended, and the action prosecuted against Charles E. Sawyer, as surviving partner of the firm aforesaid. One count is upon a promissory note, dated December 6, 1854, payable in ninety days, to the order of Levi Sawyer & Son, for the sum of $2100, signed by S. W. Porter, and indorsed by Levi Sawyer & Son. Another count is for money had and received ; and the third is a general money count, and under the last, it is stated, that the plaintiff will introduce the note described in the first count. At the trial no evidence was offered, that notice was given to the indorsers of the non-payment of the note, upon a demand upon the maker at the maturity, and a refusal. But the plaintiff relied upon a written waiver of demand and notice by the indorsers upon the note; and the jury found that the words indicating the waiver were placed upon the note [337] without the knowledge and consont of the defendant, who was proved to have indorsed the note, in the name of the firm. Without objection a draft of S. W. Porter, dated March 1, 1855, payable to the order of Charles E. Sawyer, in four months from date, at either of the banks in Boston, for the sum of $2100, was introduced, accompanied with the evidence that the same was delivered to the defendant for the purpose of meeting the note now in suit; and that after the money was received by him, which was about March 28, 1855, and before it is shown that the plaintiff had any knowledge of this draft, or the purpose for which it was in the hands of the defendant, Porter assented that the money received thereon should bo applied to take up two other drafts of Porter, on which Levi Sawyer & Son were indorsers, amounting together to the sum of $1230,49, and the same was applied accordingly. The note in suit not having been paid by the defendant in fulfillment of the original purpose of Porter, when he received the draft and the money thereon, this action is attempted to be maintained upon the second count in the writ. If no assent had been given by Porter to the diversion of the money, after it was received by the defendant, and ho held the money as the surviving partner of Levi Sawyer & Son, an action like the present, brought after the money was so in his hands, might be maintained. The case would fall within the authorities relied upon by the plaintiff. “ Whenever one man has in his hands the money of another, which he ought to pay over, he is liable to the action of money had and received, although he has never soon or heard of the party who has the right. When the fact is proved that he has the money, if he cannot show that ho has a legal or equitable ground for retaining it, the law creates the privity and the promise.” Hall v. Marston, 17 Mass. R., 575. But the defendant insists, that the distinction between this case and the cases cited in its support, arising from the new direction given to the fund by the one who furnished it, ren [338] ders the authorities relied upon entirely inapplicable; and that the instructions of the judge to the jury, that the receipt of the money by the defendant, for the purpose of meeting the note, created a vested right in the plaintiff, were erroneous. We may infer from the facts of the whole case, that the maker of the note supposed at the time he delivered the draft to the defendant, that the latter was absolutely liable under the waiver upon the note, or that he would become so after its maturity, by a seasonable notice of its non-payment upon a demand upon the maker, and that he provided the draft as security for the indorsers, as well as to discharge his own debt. But under the second count, the defendant was not attempted to be charged as a party to the note, but on account of liability, arising from the receipt of the money, as a stranger to the note, which money he was equitably bound to pay. The receipt of the draft and the money thereon by the defendant, cannot be treated as the acts of the plaintiff’s agent, when the plaintiff was entirely ignorant of the facts. The defendant must be considered the servant of the maker of the note, in those acts, in the view which is presented under the exceptions. The doctrine of the instructions to the jury, touching the liability of the defendant under the second count, is, that where a debtor has placed money in the hands of another, as his servant, to deliver to his creditor in payment or part payment of his debt, it is not in the power of the debtor to recall it, so that the servant is not liable to the creditor therefor, even if the creditor, at the time of the recall, is ignorant of the transaction. Has not the debtor, if satisfied of the unfaithfulness of his servant, after the delivery of the money to him, to be paid to his creditor, and the danger of allowing him to retain it, or for any other reason, the power to withdraw it; and when the servant surrenders it, is he equitably bound to pay the same amount to the creditor ? The privity and the promise, which the law creates, is upon the ground that he actually [339] has the money; that the purpose for which it was delivered to him, that raises by the implication the promise that he will dispose of it according to that purpose, remains unchanged; and that he cannot show any legal or equitable ground for retaining it. Our attention has been called to no case affirming such a principle as that insisted on for the plaintiff, and we have been able to find none in our own researches. If such liability is created by operation of law, it must essentially change a common practice, with prudent men. For after one had received from a debtor a sum of money to be carried to a distant place, to be paid to his creditor, and failing to go as proposed, he could not return the money to the debtor, without being liable, in case the debt should not be paid. The case of Denny v. Lincoln, Admin'r, 5 Mass. R., 385, is in its facts substantially similar to the one before us upon this point. Patterson, a debtor, in execution in the hands of the plaintiff, a deputy sheriff, delivered to Darling, the defendant's intestate, a sum of money equal to the amount of the execution, to indemnify him, on acconnt of his contract with the plaintiff, that Patterson should be produced at a future day, to be taken on the execution, or in default thereof, would pay the debt, if Patterson avoided, and by his consent the money was applied to other executions by Darling, in his hands, who was also a deputy sheriff. In an action for money had and received, against the defendant, as the administrator of Darling, for the amount left by Patterson, it was contended that the money so deposited by the debtor with Darling, was a voluntary payment to the plaintiff as the creditor, which could not be revoked; neither could Darling withhold it. Parsons, C. J., in delivering the opinion of the court, says, “ This position cannot bo admitted, in all its extent. If a debtor should send by his own servant money which he owed to his creditor, and the servant refused to deliver it, and retained it, an action for the money might be maintained by the creditor against the servant. But if the debtor had, before payment by the servant, countermanded [340] his orders, and received back the money from the servant, he would not be liable to an action by the creditor; and any person by whom the money was sent, would for this purpose be the servant of the debtor. It would be otherwise, if the money had been sent, not by the servant of the debtor, but by an agent of the creditor; for there the debtor would have no further control over it, and the receipt of the money by the agent of the creditor would discharge the debtor.” How far the receipt of money by the defendant as indorser on the note, or the receipt of the draft before the maturity of the note, would render him liable without demand and notice ; or how far he would be liable for any balance which may have remained in his hands, after the payment of the two drafts, which were taken up, by Porter’s consent, in a suit not prematurely commenced, are questions not raised by the exceptions, and no opinion is expressed. We think the instructions touching the liability of the defendant in the equitable action of money had and received, as applied to the facts of the case, were erroneous, in their full extent, even if this action had been instituted after the receipt of the money by him, upon the draft of $2100, as the surviving partner of the firm. But in looking at the writ, we find that it is dated March 10, 1855. This is sevei’al days prior to the receipt of the money by the defendant upon the draft of $2100, which was not payable till four months after its date. There being no money in the hands of the defendant, at the time this action was commenced, it cannot be maintained upon the second count therein. Exceptions sustained, verdict set aside, and new trial granted.