Kenworthy v. Stevens

Devens, J. The agreement between the parties contained the following clause, viz.: “ In case from any cause I [Clegg] am unable to carry out the provisions of this agreement, I agree to return at once to said H. R. Stevens either his acceptances or the full amount of the same ($10,200) in money, said money to be held by him until the return of his acceptances.” The defendant contends that the clause bound Clegg to return all the acceptances (or the full amount of the same in money) in case of inability or failure on his part during the performance or at the expiration of the contract to carry out all its provisions. He further contends that the fact that the number of papers in which Clegg could and did insert the advertisement was less than that honestly represented by him, and the further fact that he did not furnish to the defendant the number of papers agreed to be furnished, (for which deficiency the auditor has allowed compensation by way of recoupment,) conclusively show that the contingency contemplated by the contract has happened. He therefore argues that, as it is agreed that the same defences are open to the acceptance in the hands of the plaintiff that would be so if it were in the hands of Clegg, there can be no recovery in the present action, as it would be to permit the plaintiff to recover upon an acceptance which it was his duty to deliver up to the defendant. Clegg was an advertising agent. The written contract made by him was one which could only be carried out through a combination of newspapers known as the American Union, which embraced a large number of papers. As the payment 128 by acceptances was in its nature a payment in advance, the failure of Clegg to put himself in position to enter upon and perform the contract, by reason of his failure to make such arrangements as were necessary so to do, was, in our view, the failure against which the defendant desired to protect himself. Indeed, it was found, before the execution of the contract began, that, in one respect (that of the position of the advertisement in the papers) deemed important by both, Clegg could not make the arrangement proposed, and suitable compensation was made therefor by the payment of $800 to the defendant. The inability to “carry out the provisions of this agreement” was an inability to enter upon and fairly perform the contract as made; but it was not intended that, if he did this and substantially performed the contract, he should be bound to return the acceptances or the money therefor, if in some particulars he failed to comply with all its requirements. The circumstance that three of the acceptances would become due before the contract could possibly be performed by publishing the advertisements, and that the fourth must become due before the advertisements could be published and the lists be furnished, strongly supports our view that the inability contemplated was not a mere inability or failure to perform in subordinate details. It is further sustained by the fact that the catalogue of papers embraced in the American Union, which was published by it and honestly furnished to the defendant by Clegg at the time of making the contract, while it purported on the title-page to enumerate 1200 papers, in fact contained only 1146. The defendant had thus an ample opportunity of verifying the statement as to the number of papers controlled by this association. Even if he did not do so at the time, he must have had full knowledge after the performance of the contract began, that they were less in number than the title-page represented. Yet, with this knowledge, he did not repudiate the contract, but, as appears by his answer, paid the three earlier acceptances, thereby recognizing its existence, and trusting, it may be presumed, to his appropriate remedy, if in all particulars it was not fully performed. This remedy is found in a proper reduction by way of recoupment from the contract price as expressed in the acceptances when an action is brought thereon by Clegg, or any one properly 129 subject to the same defences. It is not easy to see why Clegg should be required to surrender the acceptance on which action is brought, and thereafter sue, as the defendant concedes he may do, on a quantum valebant for the services he has honestly performed under the contract with the honest intent of carrying it out, which have been of advantage to the defendant, and which have been accepted and partially paid for by him. Nor is it perceived that such a course would be of any benefit to the defendant. Exceptions overruled.