JULY 1829.

Carrington

V.

Caller

scription in the hands of different individuals, amounting to a very great sum of money, and it was understood that the right to a recovery was to depend on the decision of those causes: For which reason, they were, after several protracted and elaborate arguments of the most able character, decided by the court upon great deliberation.

The pleas of the defendants embraced the defences, 1st, that the notes were delivered without the name of any payee being inserted, and that the payees name had been inserted without the authority, knowledge or consent of the defendants. 2d, That they were fraudulently obtained; and 3d, that the consideration on which they were founded, was illegal as being contrary to public policy. The defendants introduced much testimony to sustain their pleas, which is too voluminous to be here inserted, but the substance of which appears in the opinions delivered by the judges, together with their views of it. To this evidence the plaintiffs demurred in law, and the plaintiffs joined in demurrer; and by consent, judgments pro forma were rendered on the demurrers in the Court below, for the defendants, in order to bring the causes before the Court without prejudice to either party. The error assigned is,that on the demurrers to the evidence, the judgment should have been for the plaintiffs.

HITCHCOCK and GORDON, for the appellants.

BAGBY, THORINGTON, ELLIOTT & KELLY, for the appellees.

By JUDGE TAYLOR. * It is to revise the judgment rendered by the Court on the demurrer of the plaintiffs to the defendants' evidence, that this cause is brought to this Court.

The action was brought upon an instrument, of which the following is a copy, viz:

"On or before the 28th day of April 1822, we or either of us promise to pay A. B. Carrington or bearer, one hundred and fifty dollars (with interest from the date if not punctually paid) for value received. Witness our hands and seals, this 29th day of April 1819.

(Signed,) JAMES CALLER, [SEAL.] ROBERT CALLER. [SEAL.]"

NOTE. This opinion appears to relate solely to the case of Carrington v. Caller, although both cases were disposed of by the principles settled by it. By refering to the opinions delivered by Judges White and Collier, the facts constituting the distinction between the two cases will be seen.

It is proved that a public sale of lands by the United States, was advertised to take place at St Stephens. That in anticipation of the sale, and shortly before it was made, several persons associated themselves together for the purpose of preventing competition at this sale, and thereby obtaining the lands at the minimum price. That this association or company entered into a written agreement which was to the following effect: "That no individual should have more than one share, and that none but a land buyer should be permitted to join the company. That each person on joining the company should pay one thousand dollars. That he should not bid at the government sales. The lands were to be bought by persons named by the committee," (this committee consisting of persons selected by the company at the time of its organization, to whom its interests were confided,) "and afterwards resold at public sale, where all persons were to be permitted to bid; and the difference between the company and government sales was to constitute a fund which was to be equally divided among the members of the company."

There is also much evidence tending to prove viola tions of these terms by the committee. That to secure a large harvest to themselves, they inserted many names of persons who were not members, as such, several of which were fictitious; and other acts were done by them in contravention of the agreement, which it is unnecessary to state, as they form none of the data on which the court has arrived at a decision.

It is proved that the members of the company, especially those who constituted the committee, were active in ascertaining the names, and particularly the pecuniary means of all strangers who arrived in town with the intention of purchasing land, and in urging every monied man, both stranger and acquaintance, to unite with them, promising an ample return of profit in the event of his doing so, and threatening to use the power which their united capital gave them, to make him give exhorbitant prices for the lands he might purchase, or to prevent him from purchasing any, if he would not make common cause with them. It is also proved that persons who were unable to raise the sum of money necessary to constitute them members of the company were operated upon in another way to induce them to aid in effecting the objects of the company, viz: preventing competition at the government sales and adding to the amount of the joint capital. Such per

JULY 1829.

Carrington

V.

Caller.

JULY 1829.

V.

Caller.

sons it is true were not received as members of the company, but as they generally consisted of settlers on the lands Carrington which were to be sold, and their single object was to purchase the places on which they resided, offers were made to them by members of the company, that if they would not bid, the company would buy the land they wanted, and let them have it at a stipulated advance, generally double the government minimum price. In this way Nicholson, one of the witnesses, purchased one quarter section, and from the evidence, the inference is irresistible that many others did the same. These persons too were threatened, that if they should bid against the company, they should be either prevented from purchasing at all, or compelled to give ruinous prices; which threats, the obstinate, in the few instances in which any had the temerity to continue so, found in the end, were literally executed. Witness the same Nicholson, who, before he would agree to the terms prescribed by the company, had been run up on four quarter sections which he purchased to $15, $10, $9, and $10, per acre. In this way, it appears from the testimony, the company succeeded in putting down opposition to their schemes, and purchased a large quantity of land, all at the minimum price of two dollars per acre, with the exception of a few quarter sections, which it is evident fell on their hands by their intention to run the settlers to the highest point, but who gave way sooner than was expected.

After the purchases were thus made, the company in conformity with their agreement, proceeded to sell at public sale the land thus purchased, on the following terms, viz: one fourth cash, the balance to be secured by notes with security, payable in four annual instalments. At this sale it appears to have been the object of many members of the company to run the land up to high prices, and as much as they could, to avoid purchasing themselves. When the sale was closed, the money and notes of the purchasers were received according to the terms, the payees' names being left blank in the latter, with the understanding that the blanks should be filled up to the person to whom they should be allotted in the distribution which was agreed to be made of them among the members of the company. The instrument sued on was one thus given and distributed, the defendant having been a purchaser at the company sale, and in the distribution, this instrument was allotted to the plaintiff, he being one of the company, and was

filled up by him according to the understanding. The defendant was also one of the company though not one of the committee. This, I believe, contains a statement of all the evidence material to a correct decision of the legality or illegality of the contract, and the consequent right of the plaintiff to recover.

It was on a demurrer to the defendant's evidence, that a judgment pro forma was rendered for the defendant. It may be well, first, to understand what is the effect of a demurrer to evidence.

This mode of wresting the decision of facts from a jury, and devolving it upon the Court, has never been favored; but a party certainly has the power to do it. When, however, it is done, the evidence is to be taken most strongly against the party demurring, and the Court is to receive as true, not only every fact which is plainly proved, but also every inference which can legitimately be drawn from the facts, against the party demurring. And the reason of the rule is this, that a party shall never be injured by an act of his adversary done without his consent; and as it is the act of his adversary to withdraw the issue from the jury, therefore, every inference the jury could have properly drawn in his favor, shall be drawn by the Court. Yet, while these positions are such as the law assumes, it is evident that the evidence is to be governed by the same rules as in other cases, and that the inferences and deductions of witnesses, with which this record is pregnant, can have no effect upon the decision of the Court.

The defendant resists a recovery on several grounds. I shall only examine one of them, which is this: "that no judgment can be rendered for the plaintiff, because the consideration for which the instrument on which the action is founded, was against public policy, therefore illegal and void."

It is a plain and undeniable principle of law, that if the consideration, or any part of the agreement, upon which the bond which is the foundation of this action, was executed, was illegal or against public policy, the bond isvoid, and there can be no recovery thereon. This position has been taken by the defendant's counsel, was not denied in the argument, nor can it be controverted. a

JULY 1829.

Carrington

V.

Caller.

a Powell on contracts 176.

The inquiry then is, was the consideration for which this 1 Comyn on bond was executed, against public policy and illegal?

But before this part of the subject is directly investigated, it is necessary to determine upon the character of the agreement entered into by the company, as respects the

contracts 30. Wheat. 258.

JULY 1829.

Carrington

V.

Caller.

a6 John. 154. b 8 John. 346.

interests of the United States; and whether that agreement, so far as it was intended to affect the sale of its lands by the Federal Government, was against public policy, and consequently illegal.

A combination between two or more persons by which it is agreed, that one or more shall not bid at an auction sale, and the other shall make the purchases for the benefit of all the parties, has uniformly been decided to be a contract against public policy, and that no recovery can be had against the bidder if he refuse to carry the agreement into execution, but he may retain all the profits of the speculation in his own hands. See 6th Johnson's Reports 194, 8th Johnson's Reports 346, and 13th Johnson's Reports 112. The case last cited is very strong. Judge Spencer, who delivered the opinion of the Court, first determines that the contract was not nudum pactum, but, except for its illegality, sufficient to sustain the action; but he proceeds to say: "Whatever may have been the motives of the parties in making the agreement, and however upright their intentions, the question recurs, is not the promise made by the defendant, void, as contravening established principles of public policy? If the considertion be ever so meritorious, yet if the act agreed to be done, and which forms the basis of the agreement.be unlawful, the promise cannot be enforced in a Court of law." He proceeds: "The judges who delivered opinions in the case of Jones v. Cawell, held, that the law had regulated sales on executions with a jealous care, and had provided a course of proceeding likely to promote a fair competition, and that a combination to prevent competition, was contrary to public policy and to the interests of the original debtor, whose property was liable to be sacrificed by such combinations. The principle was recognized in Doolin v. Ward, and in Willin v. How. These were cases of sales at auction; but the principle applies with equal, nay more force to sales on executions. He continues: "It has been urged that the plaintiff was not bound to bid on the second execution, and was, therefore, at liberty to to enter into this agreement. This is not the test of the principle. In none of the cases cited was the party bound to bid; but being at liberty to bid, he suffered himself to be bought off, in a way which might prevent a fair competion. The abstaining from bidding, upon concert and by agreement, under the promise of a benefit for thus abstaining, is the very evil the law intends to repress."