Schwarzenbach v. Odorless Excavating Apparatus Co.

Ritchie, J., delivered the opinion of the Court. This is an action for money had and received. The plaintiff having withdrawn all the counts of his declaration but the ninth, the defendant demurred, and the demurrer being sustained, the plaintiff appealed. The cause of action is, in substance, that the defendant being possessed of a patent, originally issued to Henry C. Bull and another jjerson, in 1871, for the cleaning of privies, and of a patent re-issued in 1876, claiming to contain combinations omitted by mistake in said original patent of 1871, although embraced in the specifications filed therefor, and which letters patent and specifications were recorded in the office of the Commissioner of Patents in Washington; the plaintiff relying wholly on the representations of the defendant, that the re-issued patent was valid and did contain only matters contained in the said original specifications, and being wholly ignorant of the contents of the said letters patent and specifications, did agree with defendant to pay it the sum of twenty-five cents for every load of excrement excavated by the machine he then used, which was constructed under patents issued to Scarf and Frazier in 1875, and did pay defendant the sum of six hundred and seventy-nine dollars and thirty-three cents; but that the said re-issued patent of defendant was wholly void by reason of containing improvements not in the specifications of the letters patent of 1871, and made for the purpose of covering improvements which had been patented to Scarf and Frazier; whereby the consideration of the contract wholly [38] failed, to the great loss and injury of the plaintiff, who had demanded repayment of the sum aforementioned but which the defendant had refused to make. It is not alleged that the representations of defendant were made with fraudulent intent, or that it did not correctly state the actual contents of the patents and specifications; the misrepresentations complained of, were -therefore virtually of the legal effect of the papers, or in other words, were of the purport that the re-issued patent was valid as against those of Scarf and Frazier, and that the latter infringed the former ; which infringement is denied in the narr. Whilst this denial or averment of the narr. is to be taken as true in passing upon the demurer; it is shown to be so in fact from the case of Clements against this defendant in 109 U. S. 641, to which we were referred by both sides in the argument. From this case, decided in January, 1884, it appears that the defendant had obtained below in the United States Circuit Court a decree for injunction and damages against Clements on the ground that its re-issued patent, in question in the present case, had been infringed by him in operating under the Scarf and Frazier patents; but which decree was reversed on appeal by the Supreme Court. From a fair construction of the narr. with which that case is consistent, the real question here presented is, whether where money has been paid to the owner of a patent for operating under it who has without fraud represented it to be valid and it turns out to be void, the purchaser can recover it back. We.see nothing in the facts alleged, to take this case out of the general principle, that where a party with full knowledge, actual or imputed, of the facts, there being no duress, fraud or extortion, voluntarily pays money upon a demand, though not enforcible against him, he cannot recover it back. There are a number of cases in which this [39] Court lias applied, this general principle. Several of these may be here cited: Lester vs. Mayor, &c., 29 Md., 415, is a case where the plaintiff had paid taxes decided afterwards to have been illegally assessed. Potomac Coal Co. vs. Cumb. & Penn. R. R. Co., 38 Md., 226. There the effort was to recover back freights paid in excess of proper rates. In the case of Mayor, &c. vs. Lefferman, 4 Gill, 431, where Lefferman had erected a wall upon his property binding on Jones’ Falls, pursuant to a notice from the city authorities, and afterwards brought suit to recover the amount expended, on the ground that the Act of Assembly, under authority of which the Mayor and Council had acted, was unconstitutional and void, the same rule was applied. Moreover it has been held in several well considered cases in England and in this country, and seems to be the accepted doctrine, that in a contract for the purchase of a privilege under letters patent, the seller at the time of purchase supposing his patent to be valid, its being pronounced afterwards by a legal tribunal not to be so, will not operate a failure of consideration. And Curtis’ Law of Patents, 4th Ed., sec. 216, states that it has been held that a licensee who has paid an annuity in consideration of a license to use a patent privilege which he has had the benefit of, cannot recover back the money upon the ground of the invalidity of the patent in an action for money had and received. The case of Taylor vs. Hare, 1 Bos. & Puller, New Rep., 260, fully sustains the text. In the case of Lawes vs. Purser, 6 Ellis and Black., (88 E. C. L. R., 929,) the action brought was for a sum agreed to be paid to the plaintiff for each ton of an article manufactured and sold by the defendants, by the permission of the plaintiff to them, given at their request, the plaintiff having letters patent for the sole manufacture and sale of that article. The plea set up was that the letters patent were void, and the defendants had a right to make and [40] sell the article without plaintiff’s permission. On demurrer this plea was held bad. See also Marston vs. Scott, 66 N. Y., 533; Bartlett vs. Holbrook, 1 Gray, 44. (Decided 10th March, 1886.) The Court below, being, -in our opinion, clearly right in ruling the defendant’s demurrer good, its judgment must be affirmed. Judgment affirmed.