Kervin v. Utter

Spring, J.: In February, 1881, Morris 0. Mulkin, respondents’ testator, purchased an undivided one-fourth of a twenty-acre tract of land in Bolivar, Allegany county. ' In April, 1882, the plaintiff acquired by purchase all the oil and’gas in an undivided three-fourths of the same premises. Oil had been discovered on the adjacent lands and many wells were in process of drilling, and sufficiently near to the twenty-acre tract to drain it of oil and materially lessen its value. Thereupon,in the month of April, 1882, the-plaintiff commenced to drill for oil on said premises, completing six producing wells by the 21st day of December, 1882. He expended in such development the sum of $14,696.97. Said expenditures were made in pursuance of an agreement with Mulkin, whereby he promised to pay to the plaintiff one-fourth' of the expense and cost reasonably incurred by the plaintiff in drilling said wells and operating the same. The said wells proved to be profitable and greatly enhanced the value of said premises. Mulkin received one-quarter of the oil produced, which was worth more, than $2,000. In December, 1882, the said tenants in common sold and conveyed all their interest in said premises, the said Mulkin receiving $5,000 for his one-fourth thereof.. He did not pay the plaintiff any part of the expenditures made in drilling and operating these wells, and this action was commenced many years ago to recover one-fourth of these expenditures. The original attorneys and Mulkin are dead, and also two referees who-were appointed by separate orders to hear and determine the issues involved. The papers, exhibits and minutes of the testimony taken before one of the referees in 1888 were destroyed by fire. The plaintiff’s cause of action is for money paid by him for drilling said wells'and furnishing the materials therefor, and for storing the said oil. He* alleged in the complaint that the sum so expended by him was “ sixteen thousand dollars, or thereabouts,” and demanded judgment for $4,000 and interest from January 1, 1883. The learned referee has held that the damages' were unliquidated, and, for that reason, no interest can be allowed. We cannot assent to this conclusion. Apparently there never was any controversy over the amount of [612] the expenditures made by the "plaintiff in drilling these wells. A bill of particulars was served by the attorneys for the plaintiff itemizing with particularity the charges constituting the cause of action, and they were admitted on the trial as the amount paid out by the plaintiff, and no other proof was offered upon that subject.. The executors of-the'defendant, and Mulkin when alive, claimed that there was no liability at all. In the first place, they contended that Mulkin never agreed to bear his share of these expenditures., In the second place, they claimed that, as the - expenditures were for improvements made by one- tenant in common without the direction of - his cotenant, Mullein incurred no liability to reimburse the plaintiff — a defense which under the facts of this case does not appeal to the conscience of the court. While the plaintiff did not allege the precise sum claimed to be due' from the defendant, the amount was a mere- matter of computation and easily ascertainable. When a bill of' particulars of the items constituting the demand was asked for they were furnished and were satisfactory to the defendant. He did not controvert. a single one of the expenditures contained in this long itemized statement. The action ■ is to recover money expended by the plaintiff for the enhancement of their common- premises and upon the explicit promise of the defendant to repay the plaintiff his aliquot proportion of the sum expended. The claim is not unliquidated in the .sense in which that term is used in determining whether a debtor is chargeable with interest on Ids debt. The amount paid out is not uncertain. - The items do not depend upon varying estimates. There is no countercharge to diminish the suin' which is plaintiff’s due. The amount is capable of ascertainment' by simple computation. The debtor is, therefore, liable ■ to the payment of interest. (Van Rensselaer v. Jewett, 2 N. Y. 135; McMahon v. N. Y & Erie R. R. Co., 20 id. 463, 469; White v. Miller, 78 id. 393; Sweeny v. City of N. Y., 173 id. 414; General Electric Co. v. Nat. Contracting Co., 178 id. 369, 377; Gray v. Central R. R. Co. of N. J. 157 id. 483; Excelsior Terra Cotta Co. v. Harde, 181 id. 11; Matter of Burke, 117 App. Div. 477, 479.) In Van Rensselaer v. Jewett (supra), which has long been the leading case on this subject, the rule as to the allowance of interest is thus stated at page 140 : “ The principle ,to: be extracted from [613] these decisions may be stated as follows: Whenever a debtor is in default for not paying money, delivering property, or rendering services in pursuance of his contract, justice requires that he should indemnify the creditor for the wrong which has been done him; and a just indemnity, though it may sometimes be more, can never be less, than the specified amount of money, or the value of the property or services at the time they should have been paid or rendered, with interest from the time of the default until the obligation is discharged. And if .the creditor is obliged to resort to the courts for redress, he ought, in all such cases, to recover interest, in addition to the debt by way of damages. It is true that on an agreement like the one under consideration, the amount of the debt can only be ascertained by an inquiry concerning the value of the property and services. Bnt.the value can be ascertained; and when that lias been done, the creditor, as a question of principle, is just as plainly entitled to interest after the default, as he would be. if the like sum had been payable in money.” Interest is to be computed from the time payment of the claim was demanded. (O'Keeffe v. City of N. Y., 176 N. Y. 297; Sweeny v. City of N. Y. 173 id. 414.) . As already indicáted, all the outlay was made prior to December 21, 1882, but there is no proof of a specific demand prior to the commencement of the action. Inasmuch as interest is allowable from the time demand was made, the commencement of the action will be deemed a demand setting the interest running. (White v. Miller, 78 N. Y. 393.) IT he cases cited by the counsel for the respondents are not applicable. In those cases the damages were wholly unliquidated, depending upon the determination of facts after conflicting evidence, or the claim óf the creditor was subject to diminution in an uncertain sum. In this case the. equities, if of any force, are with the plaintiff on his claim for interest. The value of the land owned by Mulkin, the original defendant, was only $250. Oil had not been discovered on these premises. If it existed it was likely to be depleted by the vigilant owners of the contiguous lands who were sinking- many wells. The plaintiff investéd his money to drill six wells- upon the promise of the defendant to contribute his aliquot share to this [614] expense. Within nine months from this. agreement Mulkih received from sales of-oil and of the land -more than $7,000. .This action . lias been pending for'about a quarter of a century .and the plaintiff has been kept out of his just due, and- Mulkin, or" his representatives, have.had the use" of the money during all o'f this time.- We think he is entitled- to interest from the date of the" commencement of the action. .The. proof does not distinctly fix that date. The. record shows that án order, of reference was granted in the action June 11, 1884, "so interest may be computed frorxi that time until the:date of the report of. the referee.- In any aspect of the. case the plaintiff is' entitled to recover and a new trial is unnecessary... • The judgment should be -modified by adding interest on the sum allowed- from June 11, 1884, to the.date of the report of the referee, with costs to the appellant. " All concur red.; Eobson, J., not sitting. Judgment modified by adding thereto interest on tlie amount reported to be due from the 11th day of June, 18'84, and as. so modified affirmed, without costs of this appeal to either party.