Packet Company v. Sickles (72 U.S. 580)/Opinion of the Court

THIS was a suit brought in the Supreme Court (the former Circuit Court) of the District of Columbia to recover damages under a special contract set forth in the declaration.

The contract, in substance, was, that on the 18th of June, 1844, the plaintiffs below, Sickles & Cook, and the Washington, &c., Steam Packet Company, the defendants, agreed that Sickles & Cook should attach, for use, to a steamboat owned by the company, the Sickles cut-off, a certain patented contrivance which was designed to effect the saving of fuel in the working of steam engines; and that, in consideration thereof, if the said cut-off should effect a saving in the consumption of fuel, the company would use it on their boat during the continuance of the said patent, IF the said boat should last so long, and that they would, for the use of the cut-off, pay to the plaintiffs, weekly, three-fourths of the value of the fuel saved. The patent had, at the date of the alleged contract, yet twelve years to run. The declaration set forth further, that it was agreed between the parties that the saving of the fuel caused by the use of the said cut-off should be ascertained by taking two piles of wood of equal quantity and burning one pile without and the other with the use of the cut-off, and thus to ascertain how much longer the boat would run, under the same circumstances, with the use of the cut-off than without, and that the proportion of savings as agreed upon above should be paid by the defendants. It alleged finally, that this experiment had been fairly made, and showed a saving of fuel by the use of the cut-off of thirty-four per cent.

The plaintiffs accordingly claimed the value of three-fourths of the fuel thus saved, between certain dates specified.

The defendants pleaded the general issue.

On the trial the plaintiffs, to support the issue, gave in evidence the record of a former trial between the same parties on the same contract as alleged, for payments due when the writ in that case was issued, in which trial a verdict and judgment had been rendered in their favor.

The declaration in the record of this former trial contained four counts:

1. A special count on the contract, corresponding in all respects with that set out in the declaration in the present suit.

2. A common count for compensation for the use of the cut-off by the defendants on their boat before that time had and enjoyed, and for such an amount as it was reasonably worth.

3. A common count for money had and received; and

4. A special count on a contract in substance like the first, with the difference hereinafter stated: It recited that, in consideration the plaintiffs had before that time attached the said Sickles cut-off to the engine of the defendants' boat, and had agreed that they should have the use of it during the continuance of the patent-right, if the boat should last so long, they, the defendants, undertook and agreed to pay the plaintiffs three-fourths of the value of the fuel saved by the use of the cut-off; that a large quantity of the fuel, to wit, one thousand cords of wood, of the value of $2500, had been saved, yet the defendants, not regarding their promise, &c., have refused, &c. The difference between this and the first count consists mainly in the omission of any agreement to ascertain the saving of fuel by the experiment.

To the declaration in this former suit, whose record was thus offered in evidence, the defendants had pleaded the general issue.

It should be here mentioned that this suit had been in this court before. It was here in 1860. On a trial from the result of which the writ of error then came, a record of a former trial had also been offered in evidence; apparently the same offered in the suit to whose result the present writ was taken.

The record offered in that previous trial contained a declaration having two counts upon the contract, with the common counts, a plea of the general issue, a general verdict for the plaintiffs on the entire declaration, and a judgment on the first count; a count similar to the counts in the declaration in the suit then pending.

Besides this testimony of the contract, the plaintiffs proved on that previous trial the quantity of fuel used in running the boat, and relied upon the rates as settled to determine their demand, and insisted that the defendants were estopped to prove there was no such contract, or to disprove any one of the averments in the first count of the declaration in the former suit, or to show that no saving of the wood had been effected; or to show that the so-called experiment was not made pursuant to the contract, or was fraudulently made, and was not a true and genuine exponent of the capacity of the said cut-off; or to prove that the said verdict was in fact rendered upon all the testimony and allegations that were submitted to the jury, and was in point of fact rendered, as by the record it purported to have been, upon the issues generally, and not upon the first count specially.

The Circuit Court adopted these conclusions of the plaintiffs, and excluded the testimony offered by the defendants to prove these facts. On the matter coming here in 1860, by exceptions in that second suit, this court, in 24th Howard, remarked upon the exclusion of this testimony as follows:

'The record produced by the plaintiff showed that the first suit was brought apparently upon the same contract as the second, and that the existence and validity of that contract might have been litigated. But the verdict might have been rendered upon the entire declaration, and without special reference to the first count. It was competent to the defendants to show the state of facts that existed at the trial, with a view to ascertain what was the matter decided upon by the verdict of the jury. It may have been that there was no contest in reference to the fairness of the experiment or to its sufficiency to ascertain the premium to be paid for the use of the machine; or it may have been that the plaintiffs abandoned their special counts and recovered upon the general counts. The judgment rendered in that suit, while it remains in force, and for the purpose of maintaining its validity, is conclusive of all the facts properly pleaded by the plaintiffs; but when it is presented as testimony in another suit, the inquiry is competent whether the same issue has been tried and settled by it.'

Considering, therefore, that the Circuit Court had erred in holding the Packet Company estopped by the proceedings in the first suit from any inquiry in respect to the matters in issue, and actually tried in that cause, this court reversed the judgment given against it, and the case went down for trial a second time; the trial, namely, after which to present writ of error was taken.

On this new trial the plaintiffs called several of the jurors who had been empanelled in the former trial, to give evidence of the testimony then given, and also as to the matters in contest before the court on that trial; the purpose in introducing this extrinsic evidence having been to prove such facts as, in connection with the record, would show that the same contract was in controversy in the second suit, and had been conclusively adjudged in their favor. [Many of these jurors, it may be remarked, while stating the particular grounds on which they found the verdict, and speaking of a contract that was before them, did not all speak so definitely as to the terms of the contract as to make it easy to say whether they described such a one as was set forth in the first count, or such a one as was set forth in the last count.]

When the plaintiffs rested, the defendants offered a competent witness to prove that the only contract given in evidence on the former trial was by parol, and not reduced to writing; the purpose of this testimony having had obvious reference to a provision of the statute of frauds, in force in the District of Columbia; the words of the statute being: 'That no suit shall be brought to charge any person upon any agreement not to be performed in one year, unless there was some memorandum or note in writing of the agreement,' & c.

The evidence thus offered was objected to, and excluded by the court. The defendants offered to prove, further, that the contract was by parol, and to be performed at the time stated in the declaration; which testimony was also objected to, and excluded, except as to the latter branch. The questions growing out of this exclusion of evidence were now before this court on a bill of exceptions for review.

Two questions were, accordingly, raised here:

1. Whether the evidence as above mentioned was rightly excluded2. Whether the contract, which it was sought to show was in issue in the former suit, was now to be regarded as valid. This question being suggested, of course, by the above-quoted section of the statute of frauds.

Messrs. Carlisle and Davidge, for the plaintiff in error:

I. The court erred in excluding the testimony:

1. Because the fact that the only evidence offered at the trial alleged to be an estoppel was parol evidence, was a fact proper for the consideration of the jury in weighing the evidence offered by the plaintiffs to show what the prior jury found.

2. Because the estopped relied on was not an estoppel of record, in the strict sense, but was to be applied by the jury to the subject-matter by parol evidence.

As the case was tried, the court assumed the absolute truth of the evidence offered by the plaintiffs, and refused to submit that evidence to the jury, or to allow the defendants to offer any evidence based on the hypothesis that the estoppel might not be found as set up. In other words, the court undertook to determine the weight of the parol evidence.

3. Because the evidence, if admitted, showed that the testimony submitted at the former trial had relation only to the common counts. Evidence of a parol contract could not support the first count of the declaration in the former suit; nor could such evidence be objected to, as it was admissible as tending to show the measure of damages under the common counts.

We assert that if, in fact, the prior jury found only a parol contract, we are not estopped from denying its validity in law in the present case. We are estopped only from denying the particular points of facts found, to wit, a parol promise.

The fact, if true, that we did not, at the former trial, make objection on this ground was, at most, but an admission for the purposes of that case. It was an admission of law, which does not estop in any subsequent action. Questions of law are not submitted to, or found by a jury, but only the naked issue of facts.

We maintain that the contract being in parol merely was void in law, since it was not to be performed within one year.

Taking it for granted, for the present, that it was void, cases show that courts go far in searching out the particular point of fact-the punctum facti-decided by the prior jury, and in holding such point to be set aside and different from the one at issue in the case on trial.

Thus, in Carter v. James, a case in the English Exchequer, the defendant had given a bond, secured by mortgage for £600. The mortgage contained a covenant to pay the debts. The plaintiff sued upon the bond, but the defendant set up a usurious agreement, and averred that the bond was given 'in pursuance of that agreement,' and so was void. The plaintiff replied that it was not given in pursuance of that agreement, and upon this issue was joined and a verdict found for the defendant. Afterwards, the plaintiff sued upon the covenants contained in the mortgage, it being confessedly for the same debt. The defendant pleaded the former verdict by way of estoppel, but, on demurrer, the plea was held bad, on the ground that the point of fact found in the former case was no answer in this; that point being that the bond was given in pursuance of the complainant's agreement, whereas in the present case the point was whether the covenant was so given, and whether the agreement itself was usurious.

The covenant was an agreement to pay the same debts as were named in the bond; and if the bond was given in pursuance of the complainant's agreement, the inference is irresistible that the covenant was so also; yet the court made a distinction.

In the prior case the plaintiff had not denied the fact of a usurious agreement, but had by his pleading virtually admitted it for the purposes of that case. Held (Alderson, B.) that his so admitting did not estop him on that point, as it was one on which the jury did not pass.

So in the present case, we deny that there was a written contract; we are not estopped from doing so by our not having denied it at the former trial, nor by the jury finding that there was a parol contract.

In Burlen v. Shannon, a prior judgment had been obtained against the defendant for the board, for a certain period, of his wife, who had left his house, she being justified in doing so, it was asserted, on the ground, first, of his cruelty, and, second, of his consent. On a suit to recover board for a subsequent period, the ground then being that the wife was absent from cruelty (not his consent), the former verdict was set up as an estoppel. But its being so was denied on the ground that it was dubious whether the jury found cruelty, and that it must be left to the present jury to decide, from the evidence produced to them, what particular fact (of the two alleged) the former jury found.

In Sawyer v. Woodbury, in the same court, a plaintiff had brought an action of covenant, alleging several distinct breaches. The jury found a general verdict in his favor. In a subsequent suit he set up one of those breaches, and claimed the former verdict as an estoppel. But the court held that evidence might be adduced to enable the jury to decide which breach it was the prior jury found.

II. The alleged contract, if merely parol, was void.

The statute avoids all contracts not 'to be' performed within one year-meaning acts agreed not to be so performed; acts agreed to be done beyond the end of one year. Now, the acts stipulated to be done by the defendant in this case were, as alleged, to pay the money at certain intervals throughout the term of twelve years. In order to perform the contracts, the defendant must make these payments.

In case the boat ceased to exist during that term, the defendants would then, indeed, be excused from paying afterwards; but this would be a defeasance, as if by a condition subsequent, not a performance of the contract.

Had the words, 'if the boat shall last so long,' not been inserted, there can be no question that the alleged agreement would be void. Can these words cause a difference? The agreement was, not to pay so long as the boat should last. If that had been the agreement, then it might possibly have been fully performed in one year. But the agreement was, to pay for twelve years, though it was provided that such payments for that period might be excused and dispensed with, if the boat should previously cease to exist.

The fact that further performance may be thus dispensed with will not take the case out of the statute.

Mr. Bradley, contra.

I. By the testimony of the former jurors, it appears that the contract specially declared on in the first two counts of the declaration in the second cause-the experiment provided for in that contract; the result of that experiment, and the consequent saving of fuel to the defendants-were the main issues in that cause, and were found by that jury.

Now, it will thus be seen that there are only two questions:

1. Was the verdict and judgment on the former trial conclusive on all the questions directly in issue on that trial, upon the proof offered by the plaintiffs, if believed by the jury?

2. Could the defendants go behind that verdict and judgment while the plaintiffs confined themselves to proof of what was then in issue and tried by the jury?

As to the first, we submit that it was, and that the court below was right in rejecting all evidence tending to show that no such contract had been made, or that the contract was not in writing, or that the experiment was insufficient to establish the rate of saving, or that it had been unfairly or fraudulently conducted. All these matters were involved in the issues raised by the two counts in the declaration and the pleas in the former action, and passed upon by the jury, as shown by the witnesses.

The other question may be more novel; but, according to general principles of law, and according to the settled law of Maryland, by which it is to be determined, is free from difficulty.

II. As to the statute of frauds.

If the contract was within the statute, the fact whether it was in writing or not was directly in issue in the first suit. If the defendant then waived the defence (if this was one) arising from the contract's being but in parol, as he might, he should have offered evidence of that fact on the second trial. He did not make such offer. None of the bills of exceptions assert that it was not set up in that action. If it had been, and if it was a defence, the suit could not have been sustained; which it was completely.

The authorities from Peter v. Compton, reported by Skinner, to this day are unmerous to show that the case was not within the statute.

What was this contract? It was one to put a machine on defendant's boat, to be paid for by a share of the savings of fuel caused by its use, to be ascertained as soon as the machine was in working order: that share to be paid for, from time to time, whenever demanded. The contract might run on to the expiration of the patent, or it might be terminated the next day. There is nothing from which it can be inferred that the parties understood it could not be performed within the year. It would have been completed by the loss or destruction of the boat at any time during the year, a matter in terms provided for.

There is a distinction between a performance which shall complete, and one which may defeat the contract within the year. If it can be completed within the year (as this one might have been), it is not brought within the statute, by the fact that it may run on for many years.

Mr. Justice NELSON delivered the opinion of the court.

When this case, or one of the class, was formerly before this court, in which the record of the former recovery was in evidence, it was claimed that, without any extrinsic evidence, it concluded the defendants from again denying the existence of the contract, or from disproving any other of the averments in the first count of the declaration, and it had been so ruled by the court below.

This court, when the case came up on error, agreed that the record was properly admitted as evidence of the former trial between the parties, but held the pleadings, verdict, and judgment did not furnish the necessary proof to show that the contract in controversy in the suit then on trial had been before agitated, and conclusively adjudicated in the former trial in behalf of the plaintiffs; and that the verdict had been rendered upon the entire declaration, and without special reference to the first count.

The record, with the pleadings and verdict, furnished evidence that the same matters might have been litigated on that trial, and afforded ground for the introduction of extrinsic evidence to show that the same contract had been in contest before the court, and had been referred to the decision of the jury, but nothing more. For this reason the judgment was reversed, and a new trial ordered.

Taking this view of the application and effect of the record of the former trial, the plaintiffs introduced in this case extrinsic evidence, and have endeavored to prove the necessary facts which, in connection with the record, would lead to the conclusion that the same contract was in controversy in the former suit, and had been conclusively adjudged in their favor. But this extrinsic evidence was open to be controverted on the poart of the defendants. As the record itself did not furnish evidence of the finding of the existence or validity of the contract in the former suit, and hence extrinsic proof was required to this effect, it was of course competent for the defendants to deny and disprove both, as in so doing they did not impeach the record, but only sought to disprove the evidence introduced by the plaintiffs.

The rejection of this evidence, therefore, offered by the defendants on the trial, was error. Whether or not the contract, as proved on the former trial, rested in parol or was in writing, was material. If in writing, there could be no controversy in fact in respect to its terms or stipulations; and its construction and legal effect belonged to the court to determine. If it rested in parol, its terms and conditions depended upon the extrinsic proof, and hence the materiality of the first question put to the witness, as preliminary to further proof. It was important to settle the terms of the contract in evidence on the former trial, in order to determine whether it was the same as the one then in controversy, and, resting in parol, these terms depended very much upon the testimony in the case.

There is another view in this branch of the case that must be noticed. As we have seen, the declaration in the former suit contained four counts, to which the general issue was pleaded, and a general verdict for the plaintiffs. The first and fourth counts set up two different special contracts relating to the same subject-matters, and which constituted the cause of action between the parties. Now, the extrinsic evidence furnished on the part of the plaintiffs as to the former trial, and the grounds of proceeding therein, tended to prove eigher court, and was sufficient to have justified the jury in finding either contract. These contracts, as thus set forth, were identical, with the exception of the agreement to settle the proportion of fuel saved by an experiment, which had been made, and resulted in the saving, by the use of the cut-off, of three-fourths of the fuel as used by the old throttle valve. The jury, therefore, might have found in favor of the plaintiffs on the contract as set forth in the fourth count, even if they disbelieved the proof of the agreement as to the mode of settling the proportion of fuel saved. Many of the jurors called and examined speak of a contract between the parties in respect to the use of the Sickles cut-off, but so indefinitely it is impossible to determine whether the testimony related to the one set out in first or fourth counts, and no attempt was made to distinguish between the one or the other on the trial.

As we understand the rule in respect to the conclusiveness of the verdict and judgment in a former trial between the same parties, when the judgment is used in pleading as a technical estoppel, or is relied on by way of evidence as conclusive, per se, it must appear, by the record of the prior suit, that the particular controversy sought to be concluded was necessarily tried and determined-that is, if the record of the former trial shows that the verdict could not have been rendered without deciding the particular matter, it will be considered as having settled that matter as to all future actions between the parties; and further, in cases where the record itself does not show that the matter was necessarily and directly found by the jury, evidence aliunde consistent with the record may be received to prove the fact; but, even where it appears from the extrinsic evidence that the matter was properly within the issue controverted in the former suit, if it be not shown that the verdict and judgment necessarily involved its consideration and determination, it will not be concluded.

In view of this doctrine, it is quite clear that the record of the former trial, together with the extrinsic proofs, failed to show that the contract in controversy in the present suit was necessarily determined in the former in behalf of the plaintiffs. We agree, if the declaration had contained but the first count, which had set out the contract in controversy in the present suit, the effect of the judgment would have been different. The verdict of the jury, then, could not have taken place without finding the existence and validity of the contract. But, as we have already shown, the record and evidence on the former trial are different, and tend to a different conclusion.

Some of the jurors in the former trial were permitted to testify as to the particular ground upon which they found the verdict. This testimony was not objected to, and therefore is not available as error here. But it is proper to say, that the secret deliberations of the jury, or grounds of their proceedings while engaged in making up their verdict, are not competent or admissible evidence of the issues or finding. The jurors oftentimes, though they may concur in the result, differ as to the grounds or reasons upon which they arrive at it.

The evidence should be confined to the points in controversy on the former trial, to the testimony given by the parties, and to the questions submitted to the jury for their consideration, and then the record furnishes the only proper proof of the verdict.

There is another suggestion, also, it may be proper to make, growing out of the rule, now very general both in the Federal and State courts, to admit the record of a former trial as evidence to conclude a party from agitating the same matters in a second suit, and that is where the extrinsic proof of the identity of the cause of action is such that the court must submit the question to the jury as a matter of fact; any other matters in defence or support of the action, as the case may be, should be admitted on the trial, under proper instructions. For, if the jury should find against the conclusiveness of the former trial, then this additional evidence would not only be material, but constitute the whole of the proof on which the cause of action or defence must rest. If the extrinsic evidence should be so conclusive that the court could properly hold the record to be conclusive, the trial would of course be at an end, so far as the matters embraced therein were identical with those in controversy. But, if not so conclusive, and the question must be submitted to the jury, then the record and evidence in respect to the former trial would constitute but one of the grounds relied on before the jury in support of the cause of action, or in defence, and be entirely consistent with any other grounds for the maintenance or defence of the suit in the possession of the parties. This must be so, for the reason that if the trial should, in the case contemplated, be confirned to the issue growing out of the former trial, and the jury should find against its conclusiveness, nothing would be determined. The former trial, therefore, when its conclusiveness must be submitted to the jury, can be regarded only as a preliminary question, and the merits, independently of this question, should be heard and tried.

As the case must go down for another trial, and as the validity of the contract set out in the declaration may be involved in that trial, it is proper that we should express our opinion upon it, if, as it was offered to be proved, the contract was not in writing, but rested in parol.

We have referred particularly to the contract in the fore part of this opinion. The question raised is, whether or not it is within the statute of frauds, and therefore void. The law in this district, it is admitted, is a copy of the English statute on the subject.

The patent had some twelve years to run after the date of this contract, which was in June, 1844.

The words of the statute are: 'That no suit shall be brought to charge any person upon any agreement that was not to be performed in one year, unless there was some memorandum or note in writing of the agreement,' &c. Now, the substance of the contract is, that the defendants are to pay in money a certain proportion of the ascertained value of the fuel saved at stated intervals throughout the period of twelve years, if the boat to which the cut-off is attached should last so long.

The statute applies to contracts not wholly to be performed within the year.

It is insisted, however, that this contract is not within it, because it may, be the happening of a certain event,-the loss or destruction of the boat,-terminate within the year. The answer is, that the possibility of defeasance does not make it the less a contract not to be performed within the year.

In Birch v. The Earl of Liverpool, a contract for hire of a coach for five years, for a stipulated price per year, was held to be within the statute, although determinable by either party at any time within that period.

The same principle was again held in Dobson and Another v. Espie. That case was the hiring of a traveller for more than a year, subject to a determination by three months' notice. Pollock, C. B., in delivering his opinion, stated that the object of the enactment was to prevent contracts not to be performed within the year from being vouched by parol evidence, when at a future period any question might arise as to their terms. No doubt, he further observes, formerly it was the practice to construe not only penal statutes, but statutes which interfered with the common law, as strictly as possible; but, in my opinion, that is not the proper course of proceeding. Alderson, B., observed: 'The very circumstance that the contract exceeds the year, brings it within the statute. If it were not so, contracts for any number of years might be made by parol, provided they contained a defeasance, which might come into operation before the end of the first year.'

We might refer to many other cases arising upon this statute. They are numerous, and not always consistent, for the reason, probably, given by Pollock, C. B., that the courts at first construed the enactment as strictly as possible, as it interfered with the common law. We think the construction given in the cases referred to is sound, and adopt it. The result is, that the contract is question is void, not being in writing. It is a contract not to be performed within the year, subject to a defeasance by the happening of a certain event, which might or might not occur within that time. All the mischiefs which the statute was intended to remedy apply with full force to it.

VENIRE DE NOVO.