Carman v. Franklin Fire Ins.

The opinion of the Court was delivered by Huston, J. The Insurance Company brought suit on a note given by Carman to them for #2800. The suit was between the payer and the payee. The Act of 28th March 1835 has declared, in the 2d section, that in all actions instituted in said court on bills, notes, bonds or other instruments of writing for the payment of money, &c. it shall be lawful for the plaintiff, on or at any time after the third Saturday succeeding the return day, on motion, to enter a judgment by default, notwithstanding an appearance by attorney, unless the defendant shall previously have filed an affidavit of defence, stating therein the nature and character of the same. Notwithstanding the affidavit of defence, the court ordered judgment for the plaintiff, and the defendant sued out this writ of error. That court gave no reasons for its decision. The errors assigned are: “ 1. The court erred in giving judgment for the plaintiff notwithstanding the affidavit of defence. 2. In deciding that the facts stated in the defendant’s affidavit did not entitle him to a jury trial. 3. In deciding that the facts stated in the affidavit could not be given in evidence by way of defalcation or set-off in this suit, and could not prevent the plaintiff’s recovering the face of the note and interest.” The words, “ or set-off,” in the third assignment of error are at least useless; for set-off it was not, in the legal and English sense of the word. The English courts had decided t-hat what is known as an equitable defence could not be made at law to a negotiable note or any evidence of debt under seal. The defendant must suffer judgment to pass on the law side, and then apply to a chancellor for relief. [158] A Court of Chancery was never regularly authorized or organized in this State, although some proceedings in that court seem to have been commenced; but as early as 1705 an Act was passed; “ If two or more deaTrng together be indebted to each other upon bonds, bills, bargains, promises, accounts or the like, and one of them commence an action in any court of this province, if the defendant cannot gainsay the deed, bargain or assumption upon which he is sued, it shall be lawful for such defendant to plead payment of all or part of the debt or sum demanded and give any bond, bill, receipt, account or bargain in evidence; and if it shall appear that the defendant hath fully paid or satisfied the debt or sum demanded, the jury shall find for the defendant, &c. And if it shall appear that any part of the sum demanded be paid, then so much as is found to be paid shall be defalked, and the plaintiff shall have judgment for the residue only, with costs of suit.” It then proceeds to direct what shall be done if the plaintiff is overpaid. More than fifty years ago it was decided that under the plea of payment with leave to give the special matter in evidence, the defendant might give in evidence anything which went to show that the plaintiff ought not to recover the whole or part of his demand. It was also settled that this Act went beyond the English statutes of set-off. The word “bargain,” there introduced into the law, showed clearly that an agreement not completed might be considered by the jury: and this has been always held to apply to any stipulations expressed or implied in the contract on which the plaintiff’s claim was founded; Steigleman v. Jeffries, (1 Serg. & Rawle 477); Heck v. Shener, (4 Ibid. 249); and many other cases cited in the argument. In Nickle v. Baldwin, (4 Watts & Serg. 290), and in one or two cases at this term, this court went further, and it was extended to breaches of other contracts than those out of which the plaintiffs’ claim arose. The defendants’ counsel stated there was no consideration. This was not pressed. Although we cannot see any gain to the plaintiff, yet injury or loss to the defendant is stated specifically, and the breach of a contract producing this is consideration enough to support or sustain the defence. See the cases above. The Act first cited as to the affidavit of defence and its nature and character, was not intended to narrow the grounds of defence in that court. Whatever by authority or on principle was a defence in any court is a defence in that court. Judgment reversed, and a venire de novo awarded.