Phalen v. Clark

19 Conn. 421
CourtSupreme Court of Connecticut
DecidedJune 15, 1849
StatusPublished
Cited by37 cases

This text of 19 Conn. 421 (Phalen v. Clark) is published on Counsel Stack Legal Research, covering Supreme Court of Connecticut primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Phalen v. Clark, 19 Conn. 421 (Colo. 1849).

Opinion

Chürch, Ch. J.

The allegations in this bill, admitted by the demurrer to be true, for the present purpose, disclose an aggravated fraud on the part of the defendants, resulting in an injury to the plaintiffs, of no ordinary amount. The first point of defence is, that, notwithstanding this concurrence of wrong and injury, there is no remedy provided, at least in a court of equity ; and is based upon the claim, that the ground of recovery has its origin in an illegal transaction — a violation of the law — in which the plaintiffs took part.

The difficulty, in this part of the case, is not so much to [432]*432determine what the true principle applicable to this subjei _is, as to determine its application to the facts alleged in the bill. We suppose it to be a well settled doctrine, that, if a plaintiff requires any aid from an illegal transaction to esta > lish his demand, he cannot recover it; or in other words, if he is unable to support it, without relying upon an unlawful agreement between himself and the defendant, he must fail. But if the parties have been engaged in business, either ma-lum in se, or merely prohibited by law; yet if the cause of action be unconnected with the illegal act, and is founded upon a distinct and collateral consideration, it will not 1 affected, by their former unlawful conduct. Booth v. Hodgson, 6 Term R. 405. Ex parte Bell, 1 Mau. & Sel. 752. Simpson v. Bloss, 7 Taun. 240. ( 2 E. C. L. 89.) Fivaz v. Nicholls, 2 Man. Gran. & Scott, 509. 511. (52 E. C. L. 500. 511.) Bartle v. Coleman, 4 Peters 184. Faikney v. Reynous, 4 Burr. 2069. Armstrong v. Toler, 11 Wheat. 258.

The lottery from which the ticket in question was issued, was legally granted, by the legislature of Rhode-Island; and the defendant, Clark, was constituted, by the plaintiffs, the managers, their agent for the sale of tickets. Clark resided in Hartford, in this state; and this ticket, with others, remained in his hands unsold, after the drawing of the lottery, and was then the property of the plaintiffs. Subsequently to all this, and while the ticket remained in the hands of Clark, not as the plaintiffs’ agent to sell, but as a mere depositary, to return on demand, the transaction took place, of which the plaintiffs complain.

The bill does not expressly allege, nor is it necessarily to be inferred from it, that Clark actually sold, or offered to sell, any tickets in this lottery ; or that it was intended he should offer them for sale in this state, and thereby violate any law of the state. But yielding the contrary to the claim of the defendants, and granting that the plaintiffs, by constituting Clark their agent in this state, had violated the statutes of the state prohibiting lotteries, and the sale of foreign lottery tickets ; a majority of the court are not persuaded, that, for this cause, the plaintiffs are without j-emedy.

Clark was only an agent of the plaintiffs to sell tickets in a lottery to he drawn ; his powers were necessarily restricted to this ; and as soon as the drawing was completed, his pow[433]*433ers ceased, and his agency as completely terminated, as if destroyed by an express revocation. If there had been any-illegal connexion between the plaintiffs and Clark before, now it ceased, and a new relation existed. The plaintiffs had forfeited no right of property in the unsold tickets, and Clark had acquired none : they were only a deposit in his hands. It was under this new relation, that the acts were committed, which are complained of, in this bill, as fraudulent. The fraudulent conspiracy between Clark and the Pink-neys, was entirely independent of any statute provisions in this state, regarding the sale of foreign tickets ; and the fraud-lent conduct of these parties, resulting from the combination, and producing the serious injury charged, was perpetrated in Rhode-Island, whose laws did not condemn, but sanctioned, every thing which had been done by the plaintiffs. Suppose Clark had used the ticket fo- any other unlawful purpose affecting the plaintiffs; as if by a forgery, he had so altered it, as to resemble a ticket in some other class of the same lottery, and in this way had abstracted money from the plaintiffs, would the law deny a remedy ? We think not. Indeed, we see no necessary connexion between the original agency of Clark, as the plaintiff’s lottery broker, and the subsequent frauds of Clark and the other defendants, by which this large amount of money has been fraudulently obtained.

We do not admit the claim of the defendants, that this bill cannot be sustained, without proving and relying upon what is claimed to be the original illegality of Clark's agency, apparent from the allegations in the bill. Such allegations were made, as is often done in common law pleadings, only as inducement, or a historical introduction to the material and traversable parts of the bill.

2. A further objection to this proceeding is, that the remedy at law is adequate, by an action of indebitatus assumpsit. There is no doubt but such an action could have been sustained, in a case like this ; but from this it cannot be assumed, that a court of law would have exclusive jurisdiction. Fraud, here, lies at the foundation; it is the ground of complaint, and the plaintiffs seek relief from its effects. Lord Hard-wicke has said, that a court of equity has undoubted jurisdiction to relieve against every species of fraud., Chancellor Kent too, lays it down as a principle, that fraud and damage, [434]*434coupled together, will entitle the injured party to relief, in any court of justice. The leading case of Booth v. Lord Warrington, 4 Brown’s Parl. Cas. 163. (Toml. ed.) in this feature, cannot well be distinguished from the present. Evans v. Bucknell, 6 Ves. 174. Bacon v. Bronson, 7 Johns. Ch. R. 194. 1 Sto. Eq. 195. But if a case sounds in damages merely, a court of equity cannot often have occasion to interfere. Russell v. Clark’s exrs., 7 Cranch 68. Hardwick v. Forbes’ admr. 1 Bibb 212.

In the present case, the plaintiffs claim, that the reasons are imperative why this couit should perform its legitimate duty in relieving against the fraud charged. The bill alleges, that the defendants carefully and fraudulently concealed all knowledge of the truth of the facts complained of, from the plaintiffs, for a period of more than six years, whereby the statute of limitations, by their fraud, bars a recovery in a court of law.

We forbear to determine the question, whether an action at law, under such circumstances, would be barred, or not; being aware of the conflicting opinions expressed on this subject, and especially of the adjudged cases in the state of New-York. Troup v. Smith’s exrs., 20 Johns. R. 33. Leonard v. Pitney, 5 Wend. 30. Allen v. Mille, 17 Wend. 202. Humbert v. Trinity Church, 24 Wend. 587.

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Bluebook (online)
19 Conn. 421, Counsel Stack Legal Research, https://law.counselstack.com/opinion/phalen-v-clark-conn-1849.