8OHSTIB'I V. UELE'I.
BONSTIB'I 'V. KEELEY.
(Otrcuit Oourt,D. Minnesota. December, 1880.)
1, CoMJmRCIAL LAW-FEDERALCOURTS.,-8'rATE CoURTB. ' Where there is a conflict between the decisions of the federal courts and those of a state court,upon a question of commercia1la the federal courts follow the decisions of the state c6urt if it appears that, by reason of the situation of the parties: and of the subject-matter, a party would otherwise be subjected to a payment of the same debt, without the possibility of relief from federal courts. ' .
SAME-PROMISE TO PAY DEBT OF THIRD PARTY.
Held, therefore, under such circumstances, that a promise to pay the debt of a third party, upon a consideration moving from the debtor, will sustain a right of action by the creditor against such promisor in a federal court.-[ED.
Motion ior a new trial. Prior to September, 1878, one Forbes was the'owner of It stock of dry goods kept in a store at Waseca, Minnesota. On the 17th of that month Forbes executed a bill of .sale of said stock of goods to the plaintiff"and also delivered to him the possession thereof. Subsequently the sheriff, by virtue of certain writs of attachment against Forbes, lened upon and took possession of the goods as the property of said Forbes, under the claim that the sale to plaintiff was fraudulent and void, because made to hinder, delay, and defraud the creditors of Forbes. The plaintiff paid for said stock to Forbes sOIPe $3,000 in cash, and assumed the payment of certain debts, held by a bank in Waseca against Forbes, amounting to about $3,800, making in all $6,800, the price agreed upon. Upon the trial the court instructed the jury, in substance; that the assumption by plaintiff of this indebtedness held by the bank was a sufficient payment of so much on account of his purchase of the stock of goods; that plaintiff's promise to pay said debts bound hiIJ;l, and was a payment as much as the payment of a like amount in money. It is conceded that under the instruction, of the court the jury must necessarily have found that plaintiff purchased without any fraudulent intent, and without any notiee of any such intent on the part
of Forbes. Assuming that the jury may have found fraud on the part of Forbes, the vendor, the counsel for defendant in· voked the doctrine that "the protection to which a bonafide holder after notice is entitled extends only to the amount that has been actually paid, " and insisted that the pqrtion of the price which was settled by assuming the bank debts was not .actually paid by the plaintiff. The court, however, charged the jury, as already stated, that payment, might be made, by assuming and agreeing to pay outstanding debts of the vendor. The proof showed that the agreement by which plaintiff assumed and agreed to pay the bank debts was or at least repeated, in the presence of the cashier of the bank, to whom a list of the debts was exhibited, with the statement that plaintiff had agreed to pay them. There was no proof of any agreement of the bank to look to plaintiff or to release Forbes, except the proof that the cashier was advised of, 'and assented to, the arrangement. The court held this to be sufficient to bind plaintiff to pay said bank debts, and therefore a payment by him of so much on the purchase price of the goods. This is the ruling now complained of. ' Wilson It Gale and Rogers tt Rogers, for the motion. C. K. Davis, contra. MCCRARY, C. J. 1. I have grave doubts as to the propriety of attempting to apply to a case at law the principle invoked by counsel for defendant in this case. That principle is that where the vendee buys in good faith, and without notice of fraud on the part of the vendor, and pays a part only of the consideration, agreeing to pay the remainder at a futu.re day, if, before such remainder is paid, he receives notice of the vendor's fraud, he will be protected only to the amount act. ually paid before noticc. No doubt this is a sound principle of equity; but can it be applied by a court of law? Can such a court rescind the contract pro tanto, and place the parties in statu quo? If so, can it be done in So case like the present, in which no issue is made except upon the validity of the sale? If the sale was held void, so as to leave the title in Forbes, against whom the attachments were issued, judgment at law eould be rendered for defendant; but where the sale is found
SONSTIBY t1. KEEL'EYi
to be valid and bonafide, in so flu' as the vendee is:concerned, and the title'is 'tested in him, and where he has sold or posed of a portion of the stook, and probably expended money and given time and labor in its' care 'and preservation/it seems probable that dnly a court of equity would be oompetent to ' grant any relief to the oreditors of the vendor. 2. But it is not neoessary to pass finally upon this question, as'I am clearly of the opinion'that the proof shows a payment by plaintiff of' the whole of the purchase price. It is contended that the promise by plaintiff to assUIhe and pay the indebtedness of Forbes at the bank, though; made' as a part of the consideration for the purchase, Was not payment; and this for the reason that plaintiff is not legally bound to pity' those debts. It is said that the holders of those claims can not sue plaintiff and reoover upon them. Upon this question there is a conflict of authority in this country. ;In many of the states the right of aotion by the payeetlf suoh debts against the party assuming to pay them is even where suoh pa,yee is not party to :the oontraot. This upon the ground that suoh a promise is an origina:l promise, based upon a valuable consideration, namely, the sale and delivery of the goods. 1 Pars. Con. (5th Ed.) 466468; Fanly v.Cleveland, 4 Cow. 432 ; Same v. Same, Id. 639 ; Canal Co. v. Bank, 4 Duer, 97; Lawrence v. Fox, 20 N. Y. 268; Arnold v. Lyman, 17 MasB. 400; Carnl1gie ·v. Morrison, 2 Met. 404; Crocker v. Stone, 7 Cush. 338; Hynd v. Holdship, 2 Watts, 104; Burs v. Robinson, 9 Barr, 229; Eddy v. Roberts, 17 Ill. 508; Todd v.Tobey, 29 Me. 219; Motley v·. Manuf'g Ins. Co. Id. 337; Metoalf on Contraots, 205..;;] 1, and cases cited in notes. And suoh is the law in Minnesota, as repeatedly decided by the supreme oourt of that state. Sanders v. Clason, 13 Minn. 379; Goetz v. Foos, 14 Minn. 265; Merriam v. Lumber Co. 23 Minn. 314. But the opposite dootrine is main;. tained by numerous cases, and among them, by the supreme court of the United States, in Nat. Bank v. Grand Lodge, 98 U. S. 123; 2 Chitty, Con. (11th Ed.) 74, and cases oited in notes; MeUon v. Whipple, 1 Gray, 317. v.7,no.4-29
PDlUWA . BEPOBTEB·.
Ordinarily thi" court feel boun.d to adopt and follow the ru).e laid down by the l'!upreme court in Nat. Bank v. Vrana Lodge, Bupra; but, under the peculiar circumstances o.f the case, I amcleady of the opinion that I to apply the rule establisQed by the supreme court of the state of Minnesota. It will be observed that the plaintiff assumed and agreed, in consideration of the sale to him of tlle stock of goods, etc., to pay certain debts held by the bank against Forbes. In so far as the debts are the property o,f the:bauk, it,is certain that they can be sued upon only in the state courtli!; for it appearl'l that the bank is a corporation 9f ,the state of Minnesota, and the plaintiff a citizen of that state. How many of tJ;1ese debts belong to the bank, how many to other parties represented by,the bank, and how many of such other parties are citizens of Minnesota, does not appear, nor is it .material; it is enough to say that certaiinly, ,a part, and probably the whole, of said debts could only be collected by suit in the state courts. It may be that some of the claims are for' less than $500, and for that rea!Jon 'not within the: jurisdiction of this court. J must assume, therefore, that, in case plaintiff refuses to, pay said claims, , suits must be brought, certainly upon some of them, and. probably upon IIIl of them, in the courts of Minnesota. So far as those courts are concerned, as already seen, the la.w is settled by repeated decisions of the supreme court, and, in accordance therewith, the plaintiff would be held liable in a suit by the payee of any of said debts. The ques,tiontherefore is, shall this court hold that the creditors of Forbes are entitled to recover from plaintiff the sum of those debts, in this case, and thus subject him to a second payment of the same amo\lllt to the holders of the claims? A decision which would establish injustice such as this, is not, I am sure, required at my hands. It is true that this case does not belong to the class in which, as a rule, the federal courts are required to follow the decisions of the highest judicial tribunal of the state. But, although the question is a new one, I am clearly of the opinion that, even on questions purely of commercial law, the federal courts
80HMIEDEtf V. BARNEY.
should follow'those decisions· if it appears that, by reason of the situation of the parties and'Of the subject.matter,to hold otherwise would subject a party to double payment of the same debt, without the possibility of l'elief from the federal courts. The motion for a new trial is overruled.
and others v.
(Oircuit Oourt, 8. D. New York. 'April 2, 1881.)
1. PRACTlCE-ATTORNEY'S DOOKET ST.
In a suit at law there were three trials before a jury, resulting upon the first trial in a verdict for the plaintiff, but followed, upon the second and third trials, in two separate verdicts for the defendant. Held, under section 824 of the Revised Statutes, that the defendant's attorney was entitled to a docket fee of $20 for each of the three trials.·-[·ED. '
Almon W. Griswold, for plaintiffs. Thomas Greenwood, Asst. Dist. Att'y, for defendant.
C. J. In this case, a suit at law, there were three trials before a jury. In the first there was a verdict for the plaintiffs, in the second a verdict for the defendant, and in the third a verdict for the defendant. In taxing the defendant's costs, after the third verdict, the clerk allowed ail attorney's trial fee of $20 to the defendant for each of the three trials. The plaintiffs have appealed from such allow. ance, claiming that but one trial fee of $20 should be allowed. The provision of the statute (Rev, St. § 824) is that .the pensation to be taxed and allowed to an attorney, "on a trial before a jury," in a civil case, shall be "a docket fee of $20." There have been three trials before a jury in this case. It has required such three trials to enable the defendant to secure the present result. The plaintiffs had the first verdict, and the defendant obtained a new trial. The defendant had the second verdict, but the plaintiffs obtained a new trial. Each of the three trials was a complete trial. A trial is not deprived of its character as a trial in fact because the verdict