Horst v. Roehm

84 F. 565, 1898 U.S. App. LEXIS 2680
CourtU.S. Circuit Court for the District of Eastern Pennsylvania
DecidedJanuary 27, 1898
DocketNo. 42
StatusPublished
Cited by9 cases

This text of 84 F. 565 (Horst v. Roehm) is published on Counsel Stack Legal Research, covering U.S. Circuit Court for the District of Eastern Pennsylvania primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Horst v. Roehm, 84 F. 565, 1898 U.S. App. LEXIS 2680 (circtedpa 1898).

Opinion

DALLAS, Circuit Judge.

1. The position taken by the defendant in his letter of June 27, 1896, and again upon the trial, is untenable. His contracts with Horst Bros, were not annulled by the dissolution of that firm, nor by the assignment of one partner’s interest therein to his co-partners. To hold otherwise, it would be necessary to maintain that any dissolution of a commercial partnership, accompanied by a division of its executory contracts, would work their extinguishment, and the statement of such a proposition is, I think, its sufficient refutation. Of course, the other contracting party may, notwithstanding dissolution and regardless of the terms thereof, hold all the partners upon a partnership contract; and, on the other hand, the contractual rights of the latter continue to be enforceable, though only by action (as in this instance), in the name of all, to the use of such of them as, by agreement among themselves, may be entitled to the proceeds of recovery. The judgment in Bank v. Hall, 101 U. S. 43, is not opposed to this view of the law. » The conclusion there reached was based, primarily and mainly, upon the actual nonexistence of an asserted contract, and what, at the close of the opinion, was said respecting “the change of the firm,” who, “if, in fact, there were * * * a contract,” had been one of the parties to it, was unnecessary to the decision. But, aside from this, the facts of that case distinguish it from the present one, and the later decisions of the same court, hereafter cited, require that it shall be distin[569]*569guished. Without pausing to point out the details oí their dissimilarity, it will suffice to observe that, in the case referred to, the substance of the rating was that a new party could not be imported into the contract there asserted, whereas, in the case now under consideration, as already said, the parties are still, both as to liability and right, precisely the same as those by whom the contract was originally made. “Rights arising out of a contract cannot be transferred if they are coupled with liabilities, or if they involve a relation of personal eoniidenee such that the party whose agreement conferred those rights must have intended them to be exercised only by him in whom he actually confided.” This statement of the law was adopted bv the supreme court in Arkansas Val. Smelting Co. v. Belden Min. Co., 127 U. S. 379, 8 Sup. Ct. 1308. No statement more favorable to the defendant could be made, but the rule it embodies cannot avail him. The liability of all the members of the plaintiff firm continued after dissolution to be precisely what it had been before, and there is nothing whatever in the contracts to indicate that they “involve a relation of personal confidence” between the defendant'and Paul R. G. Horst, the person who assigned to his co-partners. It was on the allegation that such confidence existed in fact that the defendant based his defense upon this poini; and in support of this allegation the defendant testified, in general terms, to the effect that he had been influenced, or perhaps induced, to con-trad. with the plaintiffs, by his reliance upon the judgment and fail-dealing of Paul E. G. Horst, but the admission of this testimony was duly objected to by plaintiffs’ counsel, and was received subject to that objection, and with reservation of judgment upon it. I have no doubt that it was irrelevant, and consequently I have excluded it from consideration, and have made no finding of fact with reference to it. As already indicated, 1 am of the opinion that “personal confidence,” to preclude the transfer of rights arising out of contract, must he involved in the nature of the rights themselves, so that the party whose agreement conferred those rights must have intended them to be exercised only by him in whom he actually confided. If, from the nature of the subject, personal confidence he not implied, the fact, if conceded, that the personal participation of one of several contractors in carrying out the contract had been actually relied upon would he of no consequence whatever. Delaware Co. Com’rs v. Diebold Safe & Lock Co., 133 U. S. 473-488, 10 Sup. Ct. 399.

2. This case is within the rule laid down in Hochster v. De La Tour, 2 El. & Bl. 678, and the other English cases cited in Dingley v. Oler, 117 U. S. 502, 6 Sup. Ct. 850. In the case last mentioned the supreme court, after remarking that the rule referred to had been followed by the courts of several of the states, hut had been denied by the supreme judicial court of Massachusetts, declined to decide; whether or not it should be maintained “as applicable to the class of cases” to which the’one then before it belonged. The facts of that case were somewhat peculiar, and it is not quite clear that the court’s declination to pass upon the applicability of the doctrine of Hochster v. De La Tour to it implied a doubt as to the propriety of its application in a case so plainly within that doctrine as is that now [570]*570presented. But, assuming the broad question to have been left open by the supreme court, I think that upon the preponderance of authority, as well as upon sound reasoning, it must be held that a right of action had accrued to the plaintiffs, with respect to all the contracts in question, at the time this suit was brought. There can be no doubt that this would be so under the law of England, and a diversity in the law, as administered on the two sides of the Atlantic, concerning the consequence to result from an absolute repudiation by one party of a commercial contract of this kind, is greatly to be deprecated. Norrington v. Wright, 115 U. S. 206, 6 Sup. Ct. 12. In my opinion, the argument of the court in Daniels v. Newton, 114 Mass. 530, was well and sufficiently answered by Judge Lowell in Ding'ey v. Oler, 11 Fed. 372. What is there said need not be repeated at length, but I may remark that I concur with that learned judge in thinking that the several state decisions cited by him (to which others might be added), as in conflict with Daniels v. Newton, are “founded in good sense, and rest on strong grounds of convenience, however difficult it may be to reconcile them with the strictest logic.” Since the decision of Dingley v. Oler, the circuit court of appeals for the Sixth circuit has, in two cases (in both of which Dingley v. Oler was cited), stated the law to be that, “where a contracting party gives notice of his intention not to comply with the obligation of his contract, the other party may accept this as an anticipatory breach of the contract, and sue for damages, without waiting until the time mentioned for the completion and fulfillment of the contract by its terms. * * *” Brewing Co. v. Bullock, 8 C. C. A. 14, 59 Fed. 87; Lumber Co. v. Alley, 43 U. S. App. 175, 19 C. C. A. 599, and 73 Fed. 603. In the absence of any controlling solution of the question by the supreme court, I do not hesitate to adopt this statement, supported, as it is, by the judgment of Judge Lowell, in Dingley v. Oler, as well as by the English authorities, and by the judgments of the courts of several of the states.

3. On behalf of the defendant it has been contended that “assuming that the action can be maintained, the measure of damages must be restricted to the loss, if any, upon the deliveries which should have been made prior to the bringing of the suit.” I cannot yield assent to this proposition.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

McNeff v. White Eagle Brewing Co.
13 N.E.2d 493 (Appellate Court of Illinois, 1938)
Walker Electric Co. v. New York Shipbuilding Co.
241 F. 569 (Third Circuit, 1917)
Anderson v. United States
51 Ct. Cl. 228 (Court of Claims, 1916)
Hattiesburg Lumber Co. v. Herrick
212 F. 834 (Fifth Circuit, 1914)
Stephen M. Weld & Co. v. Victory Mfg. Co.
205 F. 770 (E.D. North Carolina, 1913)
Grand Forks Lumber Co. v. McClure Logging Co.
115 N.W. 406 (Supreme Court of Minnesota, 1908)
In re Wright
157 F. 544 (Second Circuit, 1907)
River Spinning Co. v. Atlantic Mills
155 F. 466 (U.S. Circuit Court for the District of Rhode Island, 1907)

Cite This Page — Counsel Stack

Bluebook (online)
84 F. 565, 1898 U.S. App. LEXIS 2680, Counsel Stack Legal Research, https://law.counselstack.com/opinion/horst-v-roehm-circtedpa-1898.