Weller v. Eames

Berry, J. By the Court Plaintiff was captain of the steamboat “Ben Campbell,” upon which he transported for — 467 — defendant Bowers a quantity of apples, which he, plaintiff, had received from the steamboat “Centraba,” subject to a ben upon the same in favor of the “Centraba” for freight charges thereon. This claim of lien being disputed. by Bowers, the plaintiff, without collecting said charges, delivered the apples to Bowers, upon receiving from him and his co-defendant Eames, a bond conditioned as follows; “Now therefore for the purpose of getting such apples from the possession of said John Weller, this bond is given to indemnify said Weller, against any legal liability which he may have incurred to said steamboat “Centraba” by reason of having delivered said apples without having collected said back charges.” Judgment for the amount of said charges, interest thereon and costs was recovered by the owners of the “ Centraba ” against plaintiff, and one Deering, owner of the “Ben Campbell,” in an action, of the commencement, pendency and object of which defendants had due notice. It does not appear that the judgment has been paid, nor that the plaintiff has suffered any actual damage in consequence of its rendition, or his liability for the charges aforesaid, or upon said judgment. The plaintiff brings this action upon the bond, and we are of opinion that upon the facts stated it cannot be maintained. •“Indemnify” is defined by Webster to mean, “1. To save harmless; to secure against future loss or damage. 2. To make up for that which is past; to make good, to reimburse.” By Worcester it is defined to mean, “1. To secure against damage, loss, injury or penalty; to save harmless. 2. To compensate for loss or injury ; to re-imburse; to remunerate.” The word, then, appears to be used in two general senses : first, in the sense of giving security, which in a case like this at bar is done by the execution and — 468 — delivery of a bond; and second, in the sense of compensating for actual damage. ~We think the latter sense is that in which the word “indemnify” must be held to have been used in the bond in this case. If, then, for the purpose of determining what obligation the defendants have assumed,' we consult approved lexicographers, it would seem that as the agreement to indemnify was an agreement to compensate for actual damage, this action cannot be maintained without proof of actual damage. And were the question presented res nova, and to be answered solely by a consideration of the natural and ordinary signification of the language employed, we should have had very little hesitation in arriving at the conclusion, that a covenant to indemnify against legal liability, would be satisfied by compensation for all actual damage resulting from- such liability. But there are not a few authorities having a bearing "more or less direct upon the point in hand, and they are not at all harmonious. In a note to Cutter vs. Southern, 1 Williawhs Saunders, 116, relied upon by counsel upon both sides in the case at bar, it is said: “In all cases of condition to indemnify and save harmless, the proper plea is non damnifieatus, and if there be any damage the plaintiff must reply it. This plea however cannot be entertained when-the condition is to discharge or acquit the plaintiff from such a bond, or other particular thing, for then defendant must set forth affirmatively the special manner of performance. But it is otherwise where the condition is to discharge and acquit plaintiff from any damage by reason of such bond, or other particular thing, for that is in truth the same thing with a condition to indemnify and save harmless.” (And see Andrus vs. Waring, 20 Johns., 161; McClure vs. Erwin, 3 Cowen, 332; Wicker vs. Hoppock, 6 Wallace, 94.) The rule thus laid — 469 — down in the note of Serjeant Williams, seems to ns to be the .true rule, and in harmony with the general principles and analogies of the law. No distinction is there taken between an agreement to indemnify against liability, and an agreement to indemnify against damage. Put the rule is laid down in general terms that where the agreement is to indemnify, non damnificatus is the proper plea; from which it follows that actual damage is necessary to support an action upon such agreement. It has been said (Carr vs. Roberts, 5 Barn, & Adol., 78,) that there is a distinction between “ indemnify ” and “ save harmless, ” the latter, phrase possessing the more extensive meaning ; and if this be so, the necessity of showing actual damage, where the covenant is to “ indemnify ” only, is so much the greater. In the case at bar, the agreement is hot “ to discharge or acquit the plaintiff from such a bond, or other particular thing. ” It is not to discharge or acquit him from liability, but to indemnify him against liability. If the agreement had been to pay the liability, it would have been altogether different from what it really is. Then, under the rule laid down by Serjeant Williams, a rule which is almost always cited and approved whenever the subject comes before the courts, we think the plaintiff is not entitled to recover upon the facts appearing in this case. The principal difficulty presented by. the question involved in th'e case at bar, grows out of conflicting decisions in the State of New York. Chase vs. Hinman, 8 Wendell, 452, cited by appellant, is perhaps the strongest case in support of his position. It is there distinctly decided that “ if the indemnity be not only against actual damage or expense, but also against any Inability for damages or expenses, then the party need not wait until he has actually paid such damages, but his right of action is complete when he 'be — 470 — comes legally liable for them. ” This decision seems to have been based in a great degree upon Rockfeller vs. Donnelly., 8 Cowen, 639, which is however admitted by the author of the opinion in Chase vs. Hinman to go too far, and of which justice Bronson in Aberdeen vs. Blackman, 6 Hill, 326, remarks that it is, “ to say the least of it, * a very questionable case. ” (See also Webb vs. Pond, 19 Wend., 423.) And Mr. Sedgwick in his work on damages, (pages 309-314,) shows conclusively, as we think, that the rule laid down and followed in Rockfeller vs. Donnelly, is neither good law, nor good sense. The case of Chase vs. Hinman, was followed by Churchill & Hays vs. Hunt, 3 Denio, 321, in which the opinion was delivered by justice Beardsley, (justices Bronson and Jewett concurring with him). Justice Beardsley says : “ This bond is a common law obligation, and the part of the condition now in question is but an engagement to indemnify the plaintiffs against their liability as makers of the note. .Notwithstanding What is said in the case of Chase vs. Hinman, (8 Wend., 452,) I must say that. I am not aware of any distinction, at common law, between an indemnity against damage, and one against liability, which warrants a recovery on the latter on simply showing the fact of liability. In both, as I think, there must be evidence of actual damage, by the payment of nmney or otherwise. ”Gilbert vs. Wiman, 1 Comstoks, 550, when carefully examined will not be found to affirm the doctrine above referred to as enunciated in Chase vs. Hinman, if the sound rule be applied that the authority of a decided case is only co-extensive with the facts appearing in it. In this condition of the New York authorities, we have no hesitation' in following Churchill vs. Hunt as furnishing what seems to us to be the most sensible rule, that upon an agreement to indemnify, actual compensation — 471 — should only be allowed for actual loss. Warwick vs. Richardson, 10 Mees. & Weis., 284, cited by appellant, is squarely contradicted by Aberdeen vs. Blackman, 6 Hill, 325. (See also Leber vs. Kanffelt, 5 Watts & Sergeant, 442.) Pope vs. Hays, 19 Texas, 375, is based upon and follows Chase vs. Hinman, while Irving vs. Reilly, 34 Mo., 113, appears to follow Churchill vs. Hunt. (See also Jeffers vs. Johnson, 1 Zabriskie, 73.) ~We also understand that our view of the question considered is sustained in 3 Parsons’ Contracts, 186-7, and by the reasoning in Sedgwick on Damages, 303-314, where the authorities are reviewed at considerable length. If we are right, the court below erred in refusing- to charge the jury at defendant’s request “ that the plaintiff had proved no damage, and that they must find for the defendant, ” and a new trial was properly gi-anted. In this view of the matter it is unnecessary for us to consider the other points argued. Order granting a new trial affirmed.