Parmenter v. Kingsley

45 Vt. 362

Opinion

The opinion of the court was delivered by

Wilson, J.

The referees do not find, nor do the facts reported by them show, that the defendant procured the surrender of the note by fraud. It is undoubtedly true that, at the time of the dissolution of the partnership, October 10, 1855, the company assets were sufficient to pay the company liabilities. The defendant continued the business in his own name and on his own account, from the time of the dissolution of the partnership until the 10th of March, 1856, but the amount of his indebtedness at the time of his failure, does not appear. On the 10th of March, 1856, the company debts had not been paid. The defendant, at that time, was indebted to a large amount, besides the company debts ; he found his failure was inevitable, and caused process to be issued against himself, in favor of Morrill and Blackmers, and his entire property was taken from his possession, the largest portion of it by the process in favor of Morrill and Blackmers, and the remainder of it by his assignment to them. The plaintiff, soon after the failure of the defendant, ascertained that several of the company debts against Parmenter & Kingsley were still unpaid,- and he requested the defendant to pay them. The defendant then told the plaintiff that “ he, the defendant, could not pay these debts, and that the plaintiff must pay them himself.” It is claimed by the plaintiff that the defendant’s statement, that he could not pay the company debts, was false; but the report of the referees furnishes no evidence of any misrepresentation by the defendant as to his ability or inability to pay those debts. He said he could not pay them, and there is no evidence in the case that he could pay them at that time.. The fact that the defendant, with the aid derived from the compromise with the plaintiff, .did, at a later period, pay all his debts, does not prove that his statement to the plaintiff was false. It appears that the avails of all the defendant’s property which went into the hands of Morrill and Blackmer, were ultimately applied to the payment of the debts against the firm of Parmenter & Kingsley and the individual indebtedness of the.defendant. The referees do not find any intent to defraud the plaintiff, or any other person. It does not appear but that it took every dollar of the defendant’s property, including the $700 realized from the indemnity of Morrill and Blackmers, to pay his debts.

2. It is insisted by the plaintiff that the giving up of the note was wholly without consideration, and that the note, to the amount of $700, with interest from the date of the surrender, still remains a subsisting obligation against the defendant. It appears that the plaintiff held a note against the defendant for $938, ánd the defendant’s agreement to pay the company debts. The company debts, at the time the indemnity was executed, were about $1500, for the payment of which by the defendant, the plaintiff had no security except the defendant’s promise to pay them. The plaintiff could not compel the defendant to procure from a third person an indemnity to the plaintiff against the payment of those debts. But it appears that the defendant proposed to the plaintiff, if he would pay the defendant $700, the defendant would procure for the plaintiff the indemnity of Morrill and the Blackmers, indemnifying the plaintiff against the partnership debts then remaining unpaid. This proposition was accepted by the plaintiff. He paid the $700, received the indemnity in pursuance of the agreement, the balance of the note of $938 was paid to the plaintiff, and he surrendered the note to be cancelled.The security or additional security furnished the plaintiff for the payment of those debts, was a sufficient consideration for the compromise. Suppose the defendant at the time of his failure had not been indebted to the plaintiff, and the only subsisting obligation between them to have been the defendant’s agreement to pay the company debts, and the plaintiff had paid the defendant $700 to be indemnified against those debts, it would hardly be claimed that the plaintiff could recover back the sum paid for the indemnity, unless it was obtained by fraud, of which there is no evidence in the case. The circumstance that the $700 was paid to the defendant by deducting that sum from the amount of his note to the plaintiff, does not vary the legal effect of the transaction ; it stands precisely as if the money had been paid over to the defendant, and the plaintiff had been paid in full the note he held against the defendant.

The judgment of the county court is reversed, and judgment for the defendant to recover his costs.