Forster, Waterbury & Co. v. Gregory

Mr. Justice Freeman delivered the opinion of the court. Appellant concedes the law to be settled in this state, that where two parties, in this case appellant and appellee, make a contract for the benefit of a third, in the present case the brick company, the latter may, if it elects to adopt the contract, sue on it in its own name. Eddy v. Roberts, 17 Ill. 505; Dean v. Walker, 107 Ill. 540; Crandall v. Payne, 154 Ill. 627. In the case before us, however, the brick company elected, as it might do, to ignore the contract made for its benefit between appellant and appellee, and to hold appellee as its original debtor. It obtained judgment against appellee accordingly. If forced to pay that judgment it is conceded that appellee would have had his action against appellant for indemnity under the latter’s contract to pay and to hold appellee harmless from the brick company’s claim. It is contended, however, that appellee can not have his action for indemnity unless he has been injured; and it is urged that appellee was not injured by the judgment against him in favor of the brick company, because it is said he has not had to pay it, but instead of paying the judgment, he has merely assigned to the brick company the claim he would have had against appellant ii he had paid. Hence, it is argued, this suit can not be maintained, having been brought in appellee’s name for use oi the brick company. We do not concur in this contention. Appellee’s claim against appellant was deemed by the brick company sufficient consideration for the satisfaction of its judgment. The argument seems to be, however, that appellee had no claim against appellant, because, it is said, the judgment against him was satisfied by the voluntary* act of the' brick company, without any payment or loss on his part. It appears, however, that appellant had agreed to pay the claim as well as to hold appellee “ free and harmless” from the debt. The language of the agreement is that appellant “ agrees and promises to pay the claim of May, Purington & Company,” and to hold appellee “ free and harmless from and on account of all the above debts.” As is said in Gage v. Lewis, 68 Ill. 604-617, “ The reasonable construction of this language is, that the debts should be paid when- they become clue, and' as to those that were then overdue, the law required payment to be made immediately. Churchill v. Hunt, 3 Denio, 321. It was not necessary that plaintiff should have been compelled to pay these debts by a course of legal proceedings.” And it is further said that an action lies for the breach of a covenant to pay certain debts, and the obligee is entitled to recover the sums agreed to be paid, although it is not shown that he has been damnified. Appellant was notified by appellee of the suit brought by the brick company against him, and was invited to defend: This it failed to do. The general doctrine is, that “ notice in such cases to the party responsible over, imposes upon him the duty of defending and renders him liable for the result of the suit.” Drennan v. Bunn, 124 Ill. 175-189. "We are of opinion, hoxvever, that appellee did suffer a loss when he assigned over to the brick company and parted with his claim against appellant in order to procure satisfaction of the judgment against him. He had what appears to have been and the trial court has found to be a valid claim against appellant for breach of contract. That claim had a value xvhich enabled appellee to satisfy therewith the judgment against him. Finding no material error in the record the judgment is affirmed.