Backus v. Coyne

8 N.W. 694, 45 Mich. 584, 1881 Mich. LEXIS 781

• Court: Michigan Supreme Court
• Decided: April 13, 1881
• Status: Published

Opinion

Marston, C. J.

Coyne as assignee brought assumpsit for contribution upon a general average1 claim. It appeared on the trial that immediately on the arrival of the vessel in Detroit, she was libelled in the United States court for the recovery of certain claims, and amongst them claims for towing the vessel from Port Huron, where she was aground, to Detroit, and the wages of the captain and crew. It also appeared that the vessel was sold under a decree of said court, that eighty per cent, of such claims were paid out of the proceeds, except wages which were paid in full, and that a portion of the proceeds were used to pay costs and proctor’s fees in said suits, and that but for the payment of these the other claims might have been paid in full, and the court permitted the jury to take into consideration the payment of such costs and fees. Just what part this matter of costs and fees played in the case is not clearly apparent.

There can be no doubt but that a surety, or one standing in such a position, will be justified in employing counsel and incurring costs and expenses, to which his co-sureties must afterwards contribute, in defending against illegal demands. Nor will the right of the surety to recover in such cases be made dependent upon his success in the easeá, as that would compel him to act at his peril. It is sufficient if he acted as a prudent man would, in the light of facts and circumstances, showing a probability of success in whole or in part sufficient to justify the expense likely to be incurred. The foundation for the right of contribution in such cases is the fact that the expense was incurred in defending for the common benefit. This will not, therefore, permit him to incur expense in uselessly resisting a legal demand, or in creating needless or unnecessary costs and expenses. Knight v. Hughes 3 C. & P. 467; Henry v. Goldney 15 M. & W. 494; Kemp v. Finden 12 M. & W. 421; Davis v. Emerson 17 Me. 64. I am also of opinion that the mere fact of liability, and even of a judgment thereon, is not sufficient to entitle the surety to enforce contribution. There must be a payment or such assumption of the demand, as imposes upon the claimant more than his share, and a corresponding release of those against whom he claims. The surety is not the agent of the common creditor to enforce the demand, as the latter would not be bound by his act, and until payment he may look to any or all the others, and they should not thus be put to needless litigation and the danger of having to respond to the principal, notwithstanding the payment by the surety.

The record in this case does not negative the fact that evidenee was given on the trial which, under the above views, would have and did justify the court in the rulings made. No error, therefore, is apparent of record in this part of the case.

The lumber lightered off the vessel while aground, was not liable to contribute to the expenses afterwards incurred in saving the vessel and balance of the cargo. The expense afterwards incurred was not for the protection of this lumber nor necessary for such purpose. It had its own risks and perils to run while being-forwarded to its destination. Hugg v. Baltimore etc. Co. 35 Md. 414; Job v. Langton 6 El. &. Bl. 779.

It appeared that the vessel was sold under the decree of the United States court in the eases referred to for upwards of $1600, while evidence was introduced tending to show her value to have been $2000, and the jury was permitted to find either value as the basis of their verdict. This we are of opinion was erroneous. The vessel was actually sold and realized to the owner in the payment of the claims against her, upwards of $1600. In any action thereafter arising between such owner or his assignee and others interested in such claims for contribution, the actual amount for which the vessel was sold must be accepted as the true value. If the owner, in defending without good cause claims apparently legal, or otherwise, caused a sale and sacrifice of the vessel for less than her value, there would be good reason for permitting the actual value to be shown. Where, however, a sale has been made, even at a price above what some might consider the actual value, all interested therein should have the full benefit and advantage thereof.

We are of opinion, therefore, that for these reasons the judgment should be reversed with costs, and a new trial ordered.

The other Justices concurred.