Opinion
06-30-1889
LEAP v. SHARP et al.
J. J. Crandall, for complainant. R. S. Clymer, for defendants.
Bill by Joseph A. Leap against Samuel Sharp, Jr., and his father, for specific performance.
J. J. Crandall, for complainant. R. S. Clymer, for defendants.
BIRD, V. G. Leap leased his farm to Samuel Sharp, Jr., son of the other defendant. Soon after the son had taken possession he purchased a pair of horses, and gave therefor his note for $300, with Leap as surety. About the same time Leap joined with the son in giving two promissory notes, each for $50, for the benefit of the son. One of these the son paid, and afterwards, when the $300 note fell due and was renewed, the other $50 was added thereto, making $350. This last note was renewed from time to time until January 15th following, the son in the mean time paying $20 thereon. The son was unable to pay, and Leap expressed a reluctance about indorsing it again. The son was about to sell at public sale all his personal property, and had advertised for that purpose January 17th, only two days after the interview referred to about indorsing the note. Leap says that the son again induced him to indorse the note, and so extend the time of payment, by promising him that he would turn over to him notes enough, which he expected to take at his sale, to pay the note so indorsed. The sale took place, and the proceeds amounted to over $1,100, over $900 of which were represented in notes given by the respective purchasers. But only about $44 of this amount were turned over to Leap, which was applied by him to the discharge of other claims upon which he was liable. The note for $330 so indorsed by Leap he has since discharged, but has never been reimbursed. Leap brings his suit against the son and father for the recovery of the amount due. Counsel presses his claims upon two grounds,—the right to a specific performance of the promise to turn over the notes made by the son, and the right to enforce the obligation of the son as against the father, because of the fraud in which the father participated. It is alleged that the father was liable, because at the time when the farm was leased to the son the father said, according to the testimony of Leap on direct examination, "Whatever my son says he will do, you can rely on;" but also added, "I don't think he said that he would see that he would carry out what the son said he would do;" and because the father knew of the promise of the son, January 17th following, to turn over said vendue notes, and knew this fact on that day before the notes were given, but that, after such knowledge, took all of the said notes in payment of claims which he either himself held against the son or which others held against him, and upon which he was liable as surety; and also that the son was insolvent at the time he rented the farm, and that the father well knew this fact. It is undisputed that on January 15th, when the note was reindorsed by Leap, he incurred no new liability. It is also undisputed that at that time the son was indebted to his father in the manner above mentioned, and had been for a long time prior to the leasing of the said farm. There is nothing to show that the father said or did anything after the execution of the lease that would in any way bind him to Leap until the day of the sale of said goods and chattels, January 17th following; and all that he said before the execution of the lease counsel admits is not sufficient to give Leap any standing in court. It does not even appear that the father knew anything whatever about the liability of Leap upon the note referred to until he was told by Leap on the day of said sale, and just about the time of the commencement of the sale. As between the son and Leap, the critical period of time in this investigation is the time of the indorsement of the note, January 15th; and as between the father and Leap, the critical period is January 17th, when Leap so informed the father that he had a promise from the son to turn over said notes.
Now, supposing that the principles upon which this court proceeds would justify it in ordering a specific performance of the contract, and that the fraud is as palpable as it is claimed on the part of the son, then is there any real ground to support the action of the court? It is claimed that this indorsement having been procured by fraud, the court will enforce the promise which secured the indorsement, and will compel the holder of the notes to surrender them according to the promise, or to pay their value; and cites insupport of the assertion, Lupin v. Marie, 2 Paige, 169. The doctrine therein laid down, that where goods are procured by fraud the title will not pass to him, and that the vendor can reclaim them if they have not passed into the hands of a bona fide purchaser, and that a purchaser who holds them to secure antecedent debts or responsibilities cannot hold them against the original vendor, is universally assented to. But, conceding everything else necessary to make the complainant's claim well founded to have been established, there is one important ground upon which Leap and the father have a common foothold,—neither of them are bona fide purchasers. Leap was liable to the extent of $330 for a long time before his last indorsement, and the father was liable for at least three times that amount for a very much longer period of time. In this respect, therefore, there is not the semblance of evidence showing that Leap is entitled to a claim of any superior equity. All that Leap did was to join with the son in extending the time for the payment of the note, and the circumstances of the case prompt the suggestion that this extension may have been as well for the benefit of Leap as for the son; for, if he relied upon the son's promise to turn over the notes in payment of the notes so indorsed by Leap, why did Leap not at once discharge the said note and await two days for the promised satisfaction? But is there any fraud shown in which the father participated to his own profit? All that he said in commendation of his son was prior to the making of the lease, and with reference to the lease and the son's obligations thereunder. What he said upon that occasion cannot be construed to have included the subsequent transactions between the parties concerning other matters, such as the buying of the horses, and the indorsement of the note in payment thereof by Leap, and the repeated renewal of that note. Nor is there any proof that the father took any part in procuring the last indorsement of the said note, or that he suggested the means by which the son should induce Leap to so indorse it. And at this point the rights of these parties became fixed. From all that follows it would seem that the father only pursued the course which every creditor may pursue in securing the payment of his claims without being compelled to surrender that which he acquires. Leap had been informed by the son that he was indebted to his father in a large sum, and on the day of sale, and when the sale was about to be opened, he informed the father of his claim, and also-of the promise which he had from the son, as he says, but which the father very emphatically denies. The father told Leap that the son owed him over $1,100. As the testimony stands, therefore, I am not permitted to say that the father knew before the sale that the son had made any promise to Leap. It follows from what has been said that if the court has jurisdiction of the case made by the bill, there seems to be no sufficient proof upon which to found a decree against the father; and as the only object of the bill and clear purpose of the testimony are to make a case against the father, and to compel him to surrender the notes or pay their value to the extent of Leap's claim, the bill must be dismissed, with costs.