Page images
PDF
EPUB

that they are bona fide purchasers without notice. We think, under the testimony, they have proved that they are purchasers. This shifted the onus on the defendant to prove notice, or its equivalent. There was an attempt to prove actual notice to Meyer Bros., but the testimony is in such conflict that we prefer to rest our decision on another principle.

It is contended for appellee that Cook's debt, secured by the mortgage, is tainted with usury, and therefore Meyer Bros. are not bona fide purchasers, so as to cut off equitable defenses. If the facts be as alleged, the legal result contended for must follow. Carlisle v. Hill, 16 Ala. 398; Saltmarsh v. Tuthill, 13 Ala. 390; Wailes v. Couch, 75 Ala. 134; McCall v. Rogers, 77 Ala. 319. It is shown in the testimony, without conflict, that there were dealings between Meyer Bros. on one side, and Albert Cook, husband of complainant, on the other, commencing as early as 1877, and continuing to the close of 1881. The dealings consisted in advances made by Meyer Bros. each year, and payments made by Cook at the close of each season. At no time did Cook make entire payment, and the balances were severally carried forward, and made charges in the account of the next succeeding year. According to the testimony of the Meyer Bros., the unpaid balance due to them at the close of 1879 was the sum of $680.55, charged in the account of 1880. The unpaid balance of the account of 1880, thus carried forward and charged in the account of 1881, was $265.61. A note was given for this, including an additional sum to cover prospective advances, and a mortgage given by Albert Cook on the mare Hester, and other property to secure its payment. One item in the account of 1880, bearing date in January of that year, is “1 mule, $130.” This is one of the items of the account which left, at the close of the season, the un. paid balance of $265.61. That mule was purchased from Johnson for $102.50, and paid for by Meyer Bros. Three witnesses were examined in reference to this transaction. M. Meyer testifies that he purchased the mule for cash, and sold it to Cook on a credit for $130, agreed on. He admits he purchased the mule for Cook, and that Cook had informed him of the particular mule, that it was for sale, and requested him to purchase it for him. Albert Cook testifies that he alone negotiated the purchase, agreed on the price, and that, at his request, Meyer paid Johnson for the mule. He testifies, further, that there was no agreement as to what he was to pay Meyer. Johnson testifies that he and Cook negotiated and agreed on the terms of sale; that at Cook's reyniest he called on Meyer for the agreed price,-$102.50; that Meyer paid him; and that he (Johnson) then delivered the mule to Cook. Under this testimony we hold that the transaction was a loan or advance of money by Meyer Bros. to Cook; and the interest charged being in excess---greatly in excessof 8 per cent. per annum, the note is tainted with usury, and this overcomes the defense of bona fide purchaser. Collier v. Barr, 64 Ala: 543. In recovering the colt Mrs. Cook got no more than she was entitled to, and the decree of the chancellor must be affirmed.

S

CLOPTON, J., dissents from that part of the foregoing opinion which holds that usury in the debt secured by the mortgage precludes Meyer Bros. from making the defense of bona fide purchase.

KEEBLE 0. KEEBLE.

(Supreme Court of Alabama. December 8, 1888.) DAMAGES-LIQUIDATED.

Plaintiff was employed by defendant's testator as a business manager, having been his partner. He had sold to him his entire interest, but remained ostensibly a partner. A written agreement imposed on plaintiff the obligation to wholly abstain from the use of intoxicating liquors,” and “to continue and remain sober, " giving his attention to the business, and promising, in the event he should become intoxicated, that he would pay, “as liquidated damages,” the sum of $1,000, which

[ocr errors]

the testator was authorized to retain out of a debt he owed plaintiff. Plaintiff became intoxicated, and remained so for a long time, injuring thereby the business. Held, that the sum agreed to be paid was liquidated damages, and not a penalty. Appeal from city court, Dallas county; JOHN HARALSON, Judge.

This was an action brought by the appellant, Henry C. Keeble, against the appellee, Julia P. Keeble, as the executrix of R. C. Keeble, deceased, for the recovery of money alleged to be due the plaintiff by the defendant's testator. The defendant pleaded the general issue, payment, accord and satisfaction, and set-off. The only question in the case arose on the instruction given the jury by the court, founded on the facts set out in the seventh plea. The demurrer to this plea was overruled by the court. It was, in substance, that plaintiff and defendant's testator bad been in partnership in the mercantile business. Plaintitf sold out to defendant's testator, but was employed by the latter as business manager. The terms of the employment imposed on plaintiff the obligation to wholly abstain from the use of intoxicating liquors, and, in the event he should become intoxicated, that he should pay, “as liquidated damages,” the sum of $1,000. The plea alleged that plaintiff violated his promise to keep sober, and thereby became bound to pay to defendant's testator said sum of $1,000, which sum was offered as a set-off to plaintitf's demand.

Mr. Roy and White & White, for appellant. Pettus & Pettus, for appellee.

SOMERVILLE, J. The only question in this case is whether the sum of $1,000, agreed to be paid by the appellant, Henry C. Keeble, to Richard C. Keeble, the testator of the appellee, as mentioned in tho written contract of employment between the parties, is to be regarded by the court as a penalty or as liquidated damages. The city court held it, in effect, to be liquidated damages, by charging the jury to find for the defendant, if the facts set out in the seventh plea were satisfactorily proved. The solution of this question is one which the courts have often confessed embarrassment in determining. No one rule can be announced which will furnish a single test or criterion for all cases, but, in most cases, a multitude of considerations are to be regarded in seeking to reach the real intention of the parties. The following general rules may be deduced from the authorities, each having more or less weight, according to the peculiar circumstances of each case, and the nature of the contract songht to be construed: (1) The court will always seek to ascertain the true and real intention of the contracting parties, giving due weight to the language or words used in the contract, but not always being absolutely controlled by them, when the enforcement of such contract operates with unconscionable hardship, or otherwise works an injustice. (2) The mere denomination of the sum to be paid as “liquidated damages,” or as "a penalty,” is not conclusive on the court as to its real character. Although designated as “liquidated damages” it may be construed as a penalty, and often when called a “penalty” it inay be held to be liquidated damages, where the intention to the contrary is plain. (3) The courts are disposed to lean against any interpretation of a contract which will make it liquidated damages; and, in all cases of doubtful intention, will pronounce the stipulated sum a penalty. (4) Where the payment of a smaller sum is secured by an obligation to pay a larger sum, it will be held a penalty, and not liquidated. damages. (5) Where the agreement is for the performance or non-performance of a single act, or of several acts, or of several things which are but minor parts of a single complex act, and the precise damage resulting from the violation of each covenant is wholly uncertain or incapable of being ascertained save by conjecture, the parties may agree on a fixed sum as liquidated damages, and the courts will so construe it, unless it is clear on other grounds that a penalty was really intended. (6) When the contract provides for the performance of several acts of different degrees of importance, and the damages resulting from the violation of some, although not all, of the provisions are of easy ascertainment, and one large gross sum is stipulated to be paid for the breach of any, it will be construed a penalty, and not as liquidated damages. (7) When the agreement provides for the performance of one or more acts, and the stipulation is to pay the same gross sim for a partial as for a total or complete breach of performance, the sum will be construed to be a penalty. (8) Whether the sum agreed to be paid is out of proportion to the actual damages, which will probably be sustained by a breach, is a fact into which the court will not enter on inquiry, if the intent is otherwise made clear that liquidated dainages, and not a penalty, is in contemplation. (9) Where the agreement is in the alternative, to do one of two acts, but is to pay a larger sum of money in the one event than in the other, the obligor having his election to do either, the amount thus agreed to be paid will be held liquidated damages, and not a penalty. (10) In applying these rules, the controlling purpose of which is to ascertain the real intention of the parties, the court will consider the nature of the contract, the terms of the whole instrument, the consequences naturally resulting from a breach of its stipulations, and the peculiar circumstances surrounding the transaction; thus permitting each case to stand, as far as possible, on its own merits and peculiarities. These rules are believed to be sustained by the preponderance of judicial decision. Graham v. Bickham, 1 Amer. Dec. 328, and note, pp. 331-340; Williams v. Vance, 30 Amer. Rep. 26, and note, pp. 28-36; 1 Pom. Eq. Jur S$ 440-446; McPherson v. Robertson, 82 Ala. 459, 2 South. Rep. 333; Hooper v. Railroad Co., 69 Ala. 529; Watts v. Sheppard, 2 Ala. 425; Bish. Cont. § 1452; Curry v. Larer, 7 Pa. St. 470; Foley v. McKeegan, 4 lowa, 1; Nash v. Hermosilla, 9 Cal. 584; Muse v. Swayne, 2 Lea, 251; 2 Greenl. Ev. § 258.

The appellant was in the employment of the appellee's testator as a business manager, at very liberal wages, having been a partner with him in the mercantile business, under the firm name of R: C Keeble & Co. Although he was but an employe, having sold to R C. Keeble his entire interest in the partnership business, he remained ostensibly a partner. The terms of the employment, reduced to writing, imposed on the appellant, Henry Keeble, the obligation, among other duties, “to wholly abstain from the use of intoxicating liquors,” and “to continue and remain sober,” giving his diligent attention to the business of his employer, and promising, in the event he should become intoxicated, that he would pay, “as liquidated damages,” the sum of $1,000, which the testator, Richard Keeble, was authorized to retain out of a certain debt he owed the appellant. The appellant violated his promise by becoming intoxicated, and remained so for a long time, and acted rudely and insultingly towards the customers and employes of the testator, and otherwise deported himself, by reason of intoxication, in such manner as to do injury to the business. It is not denied by appellant's counsel that this is a total breach of the promise to keep sober; nor is it argued that the damage resulting from the violation of such a promise can be ascertained with any degree of certainty; nor even that the amount agreed to be paid as liquidited damages, in the event of a breach, is disproportionate to the damages which may have been actually sustained in this case. But the contention seems to be that, inasmuch as it was possible for a breach to occur with no actual dainages other than nominal, the amount agreed to be paid should be construed to be a penalty. Unless this view is correct, the application of the foregoing rules to the construction of the agreement manifestly stamps it as a stipulation for liquidated damages, and not a penalty. It is argued, in other words, that becoming intoxicated in private, while off duty, would be a violation of the contract, but would be attended with no actual damage to the business of R. C. Keeble & Co. This fact would, in our opinion, except the case from the operation of the rules above enunciated. There are but few agreements of this kind where the stipulation is to do or not to do a particular act, in which the damages may not, according to circumstances, vary, on a sliding scale, from nominal damages to a considerable sum. One may sell out tho good-will of his business in a given locality, and agree to abstain from its further prosecution, or, in the event of his breach of his agreement, to pay a certain sum as liquidated damages; as, for example, not to practice one's profession as a physician or lawyer, not to run a steam-boat on a certain river or to carry on the hotel business in a particular town, not to re-establish a newspaper for a given period, or to carry on a particular branch of business within a certain distance from a named city. In all such cases, as often decided, it is competent for the parties to stipulate for the payment of a gross sum by way of liquidated damages for the violation of the agreement, and for the very reason that such damages are uncertain, fluctuating, and incapable of easy ascertainment. Williams v. Vance, 30 Amer. Rep. 29–31, note; Graham v. Bickham, 1 Amer. Dec. 336–338, note; 1 Pom. Eq. Jur. § 442, note 1. It is clear that each of these various agreements may be violated by a substantial breach, and yet no damages might accrue except such as are nominal. The obligor may practice inedicine, and possibly never interfere with the practice of the other contracting party; or law, without having a paying client; or he may run a steam-boat without a passenger; or an hotel without a guest; or carry on a newspaper without the least injury to any competitor. But the law will not enter upon an investigation as to the quantum of damages in such cases.

This is the very matter settled by the agreement of the parties. If the act agreed not to be done is one from which, in the ordinary course of events, damages, incapable of ascertainment save by conjecture, are liable naturally to follow, sometimes more and sometimes less, according to the aggravation of the act, the court will not stop to investigate the extent of the grievance complained of as a total breach, but will accept the sum agreed on as a proper and just measurement, by way of liquidated damages, unless the real intention of the parties, under the rules above announced, designed it as a penalty. We may add, moreover, that no one can accurately estimate the physiological relation between private and public drunkenness, nor the causal connection between intoxication one time and a score of times. The latter, in each instance, may follow from the former, and the one may naturally lead to the other. There would seem to be nothing harsh or unreasonable in stipulating against the very source and beginning of the more aggravated evil sought to be avoided. The duty resting on the court, in all these cases, is to so apply the settled rules of construction as to ascertain the legally expressed and real intention of the parties. Courts are under no obligations, nor have they the power, to make a wiser or better contract for either of the parties than he may be supposed to have made for himself. The court below, in our judgment, did not err in holding, as it did, by its rulings, that the sum agreed to be paid the appellee's testator was liquidated damages, and not a penalty. Affirmed.

DAVENPORT V. STATE.

(Supreme Court of Alabama. December 17, 1888.) 1. CARRYING WEAPONS-JUSTIFICATION-APPREHENDED ATTACK.

Under Code Ala. 1886, 3775, providing that on indictment for carrying concealed weapons defendant may show “that at the time of carrying the weapon concealed he had good reason to apprehend an attack, which the jury may consider in mitigation of the punishment or justitication of the offense,” an instruction which predicates an acquittal upon defendant's mere belief that he was in danger of an attack, and not upon the fact that he had good reason to apprehend it, is properly

refused. 2. CRIMINAL LAW-EVIDENCE-CILARACTER-PARTICULAR ACTS.

In an attempt to prove general character, evidence that witness had shot two men in the neighborhood is inadmissible as showing particular acts of violence.

3. WITNESS—IMPEACHMENT-INQUIRIES AS TO CHARACTER.

It is incompetent, on direct examination, in seeking to impeach a witness to restrict the inquiries merely as to his character for honesty. 4. CRIMINAL LAW-TRIAL-INSTRUCTIONS—WEIGHT OF EVIDENCE-EXCEPTIONS.

An instruction that the testimony of certain persons named, “who testified that they saw the pistol before the firing, is entitled to great weight, and, coupled with the positive testimony of” a named witness and defendant, (that it was not concealed when drawn,) may generate a reasonable doubt in the minds of the jury, and acquit the defendant, unless they believe the testimony of said W. and the three children rather than that of the defendant and his named witnesses,” is properly refused; it appearing that the names of the witnesses on whose testimony it was based did not appear in the bill of exceptions, and the instruction being also erroneous in asserting the weight to which the testimony is entitled. Appeal from city court, Montgomery county; THOMAS M. ARRINGTON, Judge.

The defendant was indicted for carrying a pistol concealed about his person, and on his trial, as shown by the bill of exceptions, there was testimony offered tending to show that the defendant's life had been threatened a short while before the time he was accused of carrying the pistol concealed by one Henry Willingham, the principal witness for the state, and that such threats had been communicated to the defendant. The defendant then offered testi. money tending to show that the said Willingham had the character of being a violent, turbulent, and dangerous man, which testimony was admitted without objection. The defendant offered, in the same connection, testimony tending to show that the said Willingham had, a short while before the time of the alleged charge against defendant, and in the same neighborhood, shot two other men,--one of them being his brother,-- which testimony was, on objection, excluded by the court, and the defendant excepted. Defendant then, in the same connection, propounded this question to his witness, J. M. Anderson: “Do you know the general character of said Willingham, in the community where he resides, for honesty ?” The court sustained an objection, to which ruling defendant excepted. The defendant then offered testimony to show that said Willingham was a dishonest man, and a thief; which testimony, on objection, was excluded, and the defendant duly excepted. The defendant then asked the following written charges, which were refused by the court, whereupon he duly excepted: "(1) If the jury believe from the evidence that defendant had been threatened by Henry Willingham, and that defendant believed or had reason to apprehend an attack from said Willingham, then he had the legal right to carry the pistol concealed about his person, even if they should find from the evidence that it was concealed; and they had the right to look at the character of the said Willingham, as being a dangerous man, in coming to the conclusion whether or not defendant was under an apprehension of danger. (2) The testimony of Peter Bibb, Mack Jackson, and D. C. Johnson, who testified that they saw the pistol a moment before the firing, is entitled to great weight, and coupled with the positive testimony of Nellie Micou and defendant, (that it was not concealed when drawn,) may generate a reasonable doubt in the minds of the jury, and acquit the defendant, unless they believe the testimony of said Willingham and the three children, rather than that of the defendant and his named witnesses."

Thos. N. McClellan, Atty. Gen., for the State.

SOMERVILLE, J. The defendant is indicted for carrying a pistol concealed about his person. In such a case the statute provides that the defendant may give evidence, by way of defense to the prosecution, “that at the time of car. rying the weapon concealed he had good reason to apprehend an attack, which the jury may consider in mitigation of the punishment, or justification of the offense.” Crim. Code 1886, Š 3775. The evidence tended to show that one Willingham, who was a witness for the state on the trial, had threatened the defendant's life; and the character of said Willingham was that of a violent,

« PreviousContinue »