Whitehead vs. Peck. On the con the action is sustainable. But it does not appear from the facts disclosed by the record, that he purported to be his agent, or that he assumed to be his agent, or that he was considered by Peck his agent. trary, it does appear that he was his surety; that he was equally bound with him to Peck; that in consequence of this liability, acting for himself and in his character of surety, and with a view to his own protection, he made this payment. Now, is it possible that the subsequent reimbursement by Whitehead can abrogate all the relations of the parties, or set them aside, and introduce new relations? By what law are the rights of these parties determinable? By the law of principal and surety, or that of principal and agent? They are manifestly different, viewed as principal and surety, from what they are as principal and agent. To subject them to the law of both relationships would be an absurdity. We must elect between the two. And can we presume an agency, to the exclusion of all the rules which are so well settled, as applying to principal and surety-maker and endorser? If, in this case, the court can travel out of the record, and presume an agency, then may courts of justice do the same thing, in every case where a surety or an endorser takes up the paper of his principal. Had a stranger to the contract volunteered the payment of the debt, usury and all, and Whitehead reimbursed him, he would have been an agent by ratification, and this action would lie. Since Bunn was no stranger to the contract, but a party to it, and as there was no evidence of his acting with the means, or by the authority of Whitehead, we must presume that he acted on his own account, and with a view to his own interest. Whereupon the judgment of the court below was affirmed. WARNER, Judge, dissentient. I cannot concur in the opinion delivered by the majority of the court in this case. It appears from the record, in the fore part of the year, 1838, Peck, the defendant, advanced as a loan upon the note of plaintiff, with Henry Bunn, security, the sum of $2,940 00, the note being drawn for the sum of $3,500 00, payable to Peck, the defendant, to become due on or about the 1st January, 1839. About the time the note for $3,500 00 fell due, the plaintiff renewed, by giving a note for $700 00, to fall due on or about the 1st January, 1840. The plaintiff renewed a second time by giving a note for $840 00, to fall due on or about the 1st January, 1841; the plaintiff, Whitehead, indemnifying Bunn, his security, by mortgages on property. The amount of the first note for $3,500 00, and the other two notes when added together, make the sum of $5,040 00. Before the maturity of the notes given on the last renewal, Bunn as the security of the plaintiff, took up all the notes which had been given to the defendant by Whitehead as principal, and to which he was the security, amounting to the aforesaid sum of $5,040 00; and afterwards, before the last note given in renewal fell due, the plaintiff, Whitehead, paid Bunn, his sécurity, the aforesaid sum of $5,040 00 in property. The plaintiff instituted his action for money had and received against the defendants, to recover back the usurious interest. There is contest as to the fact of the transaction being usurious. The defends received a large amount of money, which, according to the laws of Whitehead vs. Peck. his country, he is not entitled to retain; but it is contended, inasmuch as the defendant did not receive the usurious interest from the hands of the plaintiff, Whitehead, but from the hands of Bunn, his security, there is no privity between the plaintiff and defendant, from which the law will imply an obligation to repay the money. The court below charged the jury, "That if Bunn, plaintiff's security, paid Peck even before the maturity of the note, and subsequently, plaintiff paid Bunn to indemnify him as security, the plaintiff must fail. But if plaintiff had paid Bunn before Bunn paid defendant, Peck, the law implied an agency of Bunn to plaintiff, Whitehead; but here the proof was, plaintiff paid Bunn, his security, after the security had paid the creditor." Before I proceed to consider the charge of the circuit judge, I will for a moment advert to the legal character of an action for money had and received. The action for money had and received, is an equitable action. "Whenever the defendant has received money which is the property of the plaintiff, and which the defendant is obliged by the ties of natural justice and equity to refund, it may be recovered from him in an action for money had and received to the plaintiff's use. This form of action has been of late years extended, on the principle of its being considered like a bill in equity; and therefore, in order to recover on a count for money had and received, the plaintiff must show, that he has equity and conscience on his side, and that he could recover it in a court of equity."-1st Leigh's Nisi Prius, 44; Moses vs. McFarlane, 2d Burrow's Rep. 1012; Straton vs. Rastall, 2d Term Rep. 370. In Moses vs. McFarlane, it is said, "This kind of equitable action to recover back money which ought not in justice to be kept, is very beneficial, and therefore much encouraged. It lies for money got through imposition, express or implied, or extortion, or oppression, or an undue advantage taken of the plaintiff's situation, contrary to laws made for the protection of persons under those circumstances." In Straton vs. Rastall, Buller, Judge, says: "In conscience, he only who received the money ought to be obliged to pay it back; and a court of equity would inquire in this case, whether the party had received the money or not." In the case under consideration, there is no controversy as to the fact that Peck, the defendant, received a large amount of money by way of usurious interest, in payment of Whitehead's notes, from the hands of Bunn, his security, which the law forbid him to receive and retain. If this large amount of usury had been paid into the hands of Peck by the plaintiff himself, it is conceded the plaintiff, Whitehead, might have recovered it back in this form of action, the parties not being, in the eye of the law, in pari delicto. Would not a court of equity, on the facts disclosed by the record in this case, decree the payment of the money, now sought to be recovered, to the plaintiff? Would not the fact that Peck had received the money in payment of Whitehead's note from Whitehead's security, which had been refunded to Bunn, the security, by Whitehead, raise such an equity in favor of Whitehead as would entitle him, in a court of equity, to a decree for the amount in the hands of the defendant, so wrongfully and unjustly received by him? If it would not so decree, then I am frank to confess, I have been greatly mistaken as to the powers and duties of a court of equity. If a court of equity would decree the repayment of the money, on the state of facts presented, then Whitehead vs. Peck. as we have seen, the action for money had and received is maintainable. I will now proceed to examine the charge of the court to the jury. The court states the law to the jury to be," that if the plaintiff had paid Bunn, before Bunn paid defendant, Peck, the law implied an agency of Bunn to plaintiff Whitehead." As I understand this part of the charge, the court intends to be understood as saying, that if Whitehead first paid the money to Bunn, and then Bunn paid it to Peck, Bunn paid the money as Whitehead's agent, and the plaintiff would be entitled, under the law, to recover, on the ground that payment by the agent is the same as payment by the principal. To this part of the charge of the court I yield my assent. But the court also charged, "that if Bunn, plaintiff's security, paid Peck, even before the maturity of the note, and subsequently, plaintiff paid Bunn, to indemnify him as security, plaintiff must fail." This part of the charge of the court, when applied to the facts of this case, necessarily defeated the plaintiff's right to recover. Was the charge of the court correct, in contemplation of law? I first proposé to examine the question of agency, without regard to the relation of principal and security existing between Bunn and Whitehead. It is admitted, if Whitehead first paid the money to Bunn, and then he paid it to Peck, Bunn was the agent of Whitehead in making the payment. But is there any difference in law, between an antecedent authority given to make the payment by Whitehead to Bunn, and the ratification of the payment subsequently, of Bunn, by Whitehead? The authorities recognize no such distinction, as will be readily discovered by reference to them. "If I make a contract in the name of a person who has not given me an authority, he will be under no obligation to ratify it, nor will he be bound to the performance of it. But if, with full knowledge of what I have done, he ratify the act, he will be considered to have contracted originally, by my agency; for the ratification is equivalent to an original authority."-1st Livermore on Agency, 44; 2d Kent's Com. 614; 2d Greenleaf's Ev. 46; Maclean vs. Dunn, 15th Com. Law Rep. 129. The maxim of the law is, that " every consent given to what has been already done, has a retrospective effect, and equals a command." If Bunn, without the knowledge of Whitehead, advanced the money to Peck, and took up Whitehead's notes, and afterwards, with a full knowledge of all the facts, Whitehead ratified the transaction, as it appears he did do, by repayment to Bunn the full amount he had paid Peck, then Bunn was as much Whitehead's agent, in making the payment, as if Whitehead had first paid the money to Bunn, and then Bunn had paid it to Peck. In contemplation of law, Bunn was as much the agent in the one case as the other. Certainly, it does not lie in the mouth of the defendant to object, Bunn was not the agent of Whitehead, in making payment and taking up Whitehead's notes, when Whitehead himself has adopted and ratified his acts as such agent, and reimbursed him the full amount paid to Peck. But, it may be said, the payment to Bunn by Whitehead was made in property. If parties agree to take property in lieu of cash, it is a good payment.Peters vs. Barnhill, 1st Hill's Carolina Rep. 234. Payment of a lebt, as surety or endorser, by conveying land which is received me as payment, will support the count for money paid, laid out Whitehead rs. Peck. and expended.-Ainslie vs. Wilson, 7th Cow. Rep. 662; Bonney vs. Seeley, 2d Wendall's Rep. 481. The defendant, in this case, can derive no aid whatever from the fact, the payment by which Bunn was reimbursed was made in property. If the parties thought proper to treat the property as cash, they had a legal right to do so, and such payment, in judgment of law, will be considered as a cash payment. The payment of the money by Bunn to Peck, having been adopted and ratified by Whitehead, subsequently, and Bunnre imbursed therefor, Whitehead is entitled, both in law and equity, to recover the amount of usurious interest from Peck, who received it, equally as if the money had been paid directly by Whitehead to Peck, out of his own hand; and the attempted evasion of the law ought not, in my judgment, to receive the sanction of this court. I have been considering this question as if the relation of principal and security did not exist between Bunn and Whitehead, at the time of the payment of the money; and have endeavored to establish the plaintiff's right to recover, on the ground that the payment to Peck was made by Bunn as the agent of Whitehead. Although there was no antecedent authority given to Bunn by Whitehead to make the payment; yet, his subsequent ratification of the payment by Bunn, and reimbursing him, was in law equivalent to an original authority, and the defendant, with the money in his pocket, could not question his agency, when Whitehead had ratified it. Does the fact that Bunn was the security of Whitehead in the least degree weaken his authority as agent in making the payment to Peck for Whitehead in a legal point of view? I think not; but, on the contrary, greatly strengthens it. The record shows that Whitehead was principal and Bunn the security, and that Bunn paid the money to Peck as security for Whitehead. If Whitehead was the principal debtor, and Bunn the security, and the money was paid by the security to Peck the creditor, such payment was, in contemplation of law, made for the principal debtor. "If one person is surety for another, and compellable to pay the whole debt, and he is called on to pay, it is money paid to the use of the principal debtor, and may be recovered in an action against him, for money paid, though the surety did not pay the debt by desire of the principal."-1st Livermore on Agency, 52-3; Tousaint vs. Martinnant, 2d Term Rep. 104; Exall vs. Partridge, Sth Term Rep. 310; Ponnall vs. Ferrand, 13th Com. Law Rep. 230. In 2d Kent's Com. 617, the learned commentator asserts the principle, that "A surety, from his relation to the principal debtor, has an interest and a right to see that the debt be paid and if he pays to relieve himself, it is money paid to and for the use of the other." If Bunn paid the money to Peck, as the security of Whitehead, as the record shows, he paid it for Whitehead; and if Whitehead had not reimbursed Bunn, he would have been entitled, so soon as the note became due, to have maintained an action against Whitehead, for so much money paid to Peck for his use. The charge of the court evidently proceeds on the ground, that Bunn, when he paid Peck, paid his own debt, when in fact he paid it for the use of Whitehead, his principal, and would have been entitled, as we have seen, (had it not been paid,) to recover it from Whitehead. If it was Bunn's own debt, he paid to Peck, money which he paid for himself, on what principle is it he would be entitled to recover it back from Whitehead? certainly would not have been entitled to have recovered back his Bun Whitehead vs. Peck. money; money paid for himself to Peck, from Whitehead? The court below asserts as the law, that the security might pay off the whole debt, and recover of the principal, for so much money paid to his use. But if Bunn the security paid it for himself, how could he recover of Whitehead, for so much money paid for his use? If Bunn paid the money to Peck for Whitehead as his security, as the record shows he did, then Whitehead is entitled to recover from Peck the amount of usury which Bunn paid him for Whitehead. The money which Peck received from Bunn, over and above the principal and lawful interest, was, in legal contemplation, Whitehead's money paid to Peck by Bunn for him, and which, in equity and good conscience, he ought to refund; and the law raises an assumpsit in favor of Whitehead, and creates a privity of contract between Peck and Whitehead, which authorizes the plaintiff to recover in this form of action.-Camp vs. Tompkins, 9th Connecticut Rep. 553; Mason vs. White, 17th Mass. Rep. 560; Hall vs. Marston, 17th Mass. Rep. 575; Wilson & Co. vs. Smith, 3d Howard's Rep. 763. In Camp vs. Tompkins it is said, "In the eye of the law, there is always such privity of contract as is necessary to sustain this action, between a person who holds the money of another, which in equity and good conscience he is bound to refund, and the person whose money is thus withheld." In Hall vs. Marston, which was an action for money had and received, Chief Justice Parker says: "There are many cases, in which this action is supported without any privity between the parties, other than what is created by law. Whenever one man has in his hands the money of another, which he ought to pay over, he is liable to this action, although he has never seen or heard of the party who has the right. When the fact is proved, he has the money; if he cannot show that he has legal or equitable ground for retaining it, the law creates the privity and the promise." If it be contended Bunn paid the money voluntarily, before the notes became due, without authority from Whitehead, it may be answered, Peck received the money for Whitehead's notes, and Whitehead, with a full knowledge of the facts, ratified the payment made by Bunn, and reimbursed him; therefore, in judgment of law, the payment was made by Bunn as the agent of Whitehead, as clearly, as if Whitehead had in the first instance given Bunn the money to hand over to Peck, on the principle, that the ratification of the act of payment, by Whitehead, is equivalent to an original authority to Bunn, to make such payment. Besides, Whitehead having recognized and ratified the payment made by Bunn, Peck, with the money in his pocket, cannot be heard in denial of Bunn's agency, to make such payment for Whitehead. In my judgment, it would be iniquitous to permit him to do so, for the purpose of defeating this equitable action. If Bunn paid the money to Peck, the creditor, as the security of Whitehead, as the record shows he did, then he paid it for Whitehead, and Whitehead has reimbursed him. The defendant, Peck, then, has the money of Whitehead, which, under the laws of the country, he ought not to retain, paid to him either by Bunn as his agent, or paid to him for Whitehead by Bunn, his security; and not being able to show, "he has either a legal or equitable ground for retaining it, the law creates the privity and the promise" necessary, to entitle the plaintiff to recover. n therefore of the opinion the judgment of the court below should be sed, and a new trial granted. |