Wayne County MI Archives Court.....Pratt, V. Campbell 1837
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Deb Haines http://www.genrecords.net/emailregistry/vols/00003.html#0000719 August 9, 2008, 7:31 am

Source: Cases In Chancery
Written: 1837

CASES IN CHANCERY.
FIRST CIRCUIT.

John A. Pratt and another v. Edward E. Campbell and others.

Agency disavowed. Where parties assumed to be agents for a bank in settling a 
demand, and procured from the debtor an assignment of property in compromise, 
and the bank denied their authority to make the compromise, whereupon the 
debtor made a second assignment of the property to complainants, held, that 
complainants might maintain a bill in equity to restrain the assumed agents 
from collecting and disposing of the property. (a.)

Motion to dissolve injunction for want of equity.

The bill states that in December, 1838, Thomas Emerson was largely indebted to 
the Bank of Windsor, and a judgment had been recovered against him by the 
bank, to the amount of $59,000, upon which the latter threatened to issue a 
ca. sa.; that E. R. Campbell and Rufus Emerson proposed a compromise, in the 
name of the bank; that they represented themselves as the agents and attorneys 
of the bank, with full power to bind their principal; during the negotiation 
they conferred repeatedly with the officers of the bank, and Thomas Emerson 
refused to treat with them in any other capacity; that on this understanding a 
compromise was made; that previously to this, the bank had commenced various 
trustee or attachment suits against the property and credits of Thomas 
Emerson, in the States of Ohio, Indiana and Michigan; that by the terms of the 
compromise, Thomas Emerson was to pay $20,000, in approved securities, in 
payment and satisfaction of the bank's claim against him; these securities 
were to be assigned to E. R. Campbell and Rufus Emerson, and as collateral 
security for the payment of the assigned securities, other obligations were to 
be transferred to said Campbell and Emerson; that Royal H. Waller, as agent 
and attorney of all the parties, was to be sent to Michigan to change and 
secure the obligations which had been assigned by T. Emerson, in payment and 
satisfaction of the bank's claim against him, and which were principally due 
and owing from residents of this State; that the bank authorized him to act 
for them in the premises, and by virtue of their power of attorney he 
discontinued the attachment suits, changed the form of the securities assigned 
in payment, took some notes payable to Campbell and Emerson, and took, also, 
an assignment to them of some bonds and mortgages; after doing this, he 
returned to Vermont. The bank professed to be dissatisfied, and demanded and 
received additional securities as collateral to those assigned in payment of 
T. Emerson's debt, and which had been thus changed by said R. H. Waller ; that 
after this, the bank, for the first time, repudiated the contract, denied the 
right of E. R. Campbell and Rufus Emerson to bind them in the premises, and 
without proffering a return of the securities, proceeded on their judgment 
against said Thomas Emerson, and issued execution thereon; that at the same 
time Campbell and Emerson took similar ground, and claimed all the above 
securities as their own individual property; that this claim was founded 
principally on the alterations of the articles, made by them fraudulently, 
after the first execution thereof; that after the perpetration of these 
alleged frauds, and the entire failure of the contract between Thomas Emerson 
and the bank, he assigned all the securities and all his claim against the 
bank and said Campbell and Emerson to the complainants, who had incurred heavy 
responsibilities for his benefit. The complainants aver the utter insolvency 
of Edward R. Campbell and Rufus Emerson; they aver that the notes, bonds, 
etc., are now in Detroit, and some of them in process of collection, and pray 
that said Campbell and Emerson may be compelled to deliver them to the 
complainants; that the attorneys who hold them may be restrained from giving 
them back to Campbell and Emerson, and from paying moneys already collected to 
the latter; that no more suits may be brought in behalf of Campbell and 
Emerson, and that the several debtors may be decreed to pay and account to the 
complainants; and may be enjoined from paying Campbell and Emerson.

No injunction is asked to restrain the proceedings at law
already commenced. 
Injunction granted, as prayed.

The defendants move to dissolve the injunction for want of equity in the bill.

D. Goodwin, in support of the motion. 

1. The whole case is based on the assignment from Thomas Emerson to Emerson 
and Campbell, which is attempted to be varied as to its legal effect, by 
parol. (1 Peters R., 1; 4 B. & C., 513.)

This cannot be done. It was executed with a full knowledge of the facts, and 
deliberately. Emerson intended to execute just such an instrument at the time 
of its execution, and the previous conversations and negotiations cannot be 
resorted to to control it; they are merged in it.

As to the insolvency, it is alleged to have existed at the time.

2. Upon the ground assumed by the complainants, there is no consideration for 
the agreement. Emerson owed the whole debt, and was hound legally to suffer 
judgment and pay it; and judgment being rendered, to pay the whole amount. If 
a false plea were interposed for delay, the court, if such were known to them 
to be the fact, would strike it out without ceremony, and the agreement to 
receive a less sum than the amount due would be no satisfaction or discharge, 
even if the lesser sum were paid; and the damages upon such a covenant would 
be merely nominal. (Chitty on Con., 277; 17 Johns. R., 169; 5 East, 252; 4 B. 
& C., 513; 1 Ib., 426.)

3. Thomas Emerson makes no complaint as to the assignment or the present 
disposition of the bonds, etc. It is not competent for his assignee to do so 
of his own motion; on the contrary, there appears an after consent on the part 
of Emerson.

T. Romeyn, contra.

The Chancellor.—The facts presented in this case are sufficient to retain the 
injunction, and entitle the complainants to an answer.

After Campbell and Rufus Emerson had obtained an assignment and the possession 
of the property of Thomas Emerson, by assuming to act as the authorized agents 
and attorneys of the Bank of Windsor, the bank refused to perform the 
conditions on which the assignment was made, and denied the authority of 
Campbell and Emerson to act as the agents of the bank in the premises, and the 
bank, and Campbell and Emerson, who assumed to act as the agents of the bank, 
now refuse to return the property, and are proceeding to collect the demands, 
and use the property assigned by Thomas Emerson.

It also appears that subsequent to the disavowal of the authority of Campbell 
and Emerson by the bank to act as its agents in the premises, and denial of 
their authority to make the compromise, Thomas Emerson has assigned the 
property and demands to the complainants, who claim to be the legal and bona 
fide owners of the same.

The facts presented by the bill are sufficient to authorize the retaining of 
the injunction, and the motion to dissolve must be denied.

Motion denied.

------------------
(a.) A person cannot ratify in part the contract of one who has assumed to act 
as his agent, and repudiate it in other particulars. Widner v Olmstead, 14 
Mich., 124; Peninsular Bank v. Hanmer, Ib., 208; Hutchins v. Ladd, 16 Mich., 
493.

Additional Comments:
CASES DETERMINED IN THE COURT OF CHANCERY FOR THE STATE OF MICHIGAN
BY ELON FARNSWORTH, Chancellor 

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