Thomson v. Wooster/Opinion of the Court

The appellants have assigned 14 reasons or grounds for reversing the decree. The first nine relate to the taking of the account before the master, and his report thereon; the last five relate to the validity of the letters patent on which the suit was brought. It will be convenient to consider the last reasons first. The bill, as we have seen, was taken pro confesso, and a decree pro confesso was regularly entered up, declaring that the letters patent were valid, that Douglass was the original inventor of the invention therein described and claimed, that the defendants were infringing the patent, and that they must account to the complainant for the profits made by them by such infringement and for the damages he had sustained thereby; and it was referred to a master to take and state an account of such profits and to ascertain said damages. The defendants are concluded by that decree, so far at least as it is supported by the allegations of the bill, taking the same to be true. Being carefully based on these allegations, and not extending beyond them, it cannot now be questioned by the defendants unless it is shown to be erroneous by other statements contained in the bill itself. A confession of facts properly pleaded dispenses with proof of those facts, and is as effective for the purposes of the suit as if the facts were proved; and a decree pro confesso regards the statements of the bill as confessed.

By the early practice of the civil law, failure to appear at the day to which the cause was adjourned, was deemed a confession of the action; but in later times this rule was changed, so that the plaintiff, notwithstanding the contumacy of the defendant, only obtained judgment in accordance with the truth of the case as established by an ex parte examination. Keller, Proced. Rom. § 69. The original practice of the English court of chancery was in accordance with the later Roman law. Hawkins v. Crook, 2 P. Wms. 556. But for at least two centuries past, bills have been taken pro confesso for contumacy. Id. Chief Baron GILBERT says: 'Where a man appears by his clerk in court, and after lies in prison, and is brought up three times to court by habeas corpus, and has the bill read to him, and refuses to answer, such public refusal in court does amount to the confession of the whole bill. Secondly. When a person appears and departs without answering, and the whole process of the court has been awarded against him after his appearance and departure, to the sequestration; there also the bill is taken pro confesso, because it is presumed to be true when he has appeared, and departs in despite of the court, and withstands all its process without answering.' Forum Romanum, 36. Lord HARDWICKE likened a decree pro confesso to a judgment by nil dicit at common law, and to judgment for plaintiff on demurrer to the defendant's plea. Davis v. Davis, 2 Atk. 21. It was said in Hawkins v. Crook, qua supra, and quoted in 2 Eq. Cas. Abr. 179, that 'the method in equity of taking a bill pro confesso is consonant to the rule and practice of the courts at law, where, if the defendant makes default by nil dicit, judgment is immediately given in debt, or in all cases where the thing demanded is certain; but where the matter sued for consists in damages, a judgment interlocutory is given; after which a writ of inquiry goes to ascertain the damages, and then the judgment follows.' The strict analogy of this proceeding in actions of law to a general decree pro confesso in equity in favor of the complainant, with a reference to a master to take a necessary account, or to assess unliquidated damages, is obvious and striking.

A carefully prepared istory of the practice and effect of taking bills pro confesso is given in Williams v. Corwin, Hopk. Ch. 471, by HOFFMAN, master, in a report made to Chancellor SANFORD, of New York, in which the conclusion come to, (and adopted by the chancellor,) as to the effect of taking a bill pro confesso, was that 'when the allegations of a bill are distinct and positive, and the bill is taken as confessed, such allegations are taken as true, without proofs,' and a decree will be made accordingly; but 'where the allegations of a bill are indefinite, or the demand of the complainant is in its nature uncertain, the certainty requisite to a proper decree must be afforded by proofs. The bill, when confessed by the default of the defendant, is taken to be true in all matters alleged with sufficient certainty; but in respect to matters not alleged with due certainty, or subjects which from their nature and the course of the court require an examination of details, the obligation to furnish proofs rests on the complainant.'

We may properly say, therefore, that to take a bill pro confesso is to order it to stand as if its statements were confessed to be true; and that a decree pro confesso is a decree based on such statements, assumed to be true, (1 Smith, Ch. Pr. 153,) and such a decree is as binding and conclusive as any decree rendered in the most solemn manner. 'It cannot be impeached collaterally, but only upon a bill of review, or [a bill] to set it aside for fraud.' 1 Daniell, Ch. Pr. (1st Ed.) 696; Ogilvie v. Herne, 13 Ves. 563.

Such being the general nature and effect of an order taking a bill pro confesso, and of a decree pro confesso regularly made thereon, we are prepared to understand the full force of our rules of practice on the subject. Those rules, of course, are to govern so far as they apply; but the effect and meaning of the terms which they employ are necessarily to be sought in the books of authority to which we have referred. By our rules a decree pro confesso may be had if the defendant, on being served with process, fails to appear within the time required; or if, having appeared, he fails to plead, demur, or answer to the bill within the time limited for that purpose; or if he fails to answer after a former plea, demurrer, or answer is overruled or declared insufficient. The twelfth rule in equity prescribes the time when the subpoena shall be made returnable, and directs that 'at the bottom of the subpoena shall be placed a memorandum, that the defendant is to enter his appearance in the suit in the clerk's office on or before the day at which the writ is returnable; otherwise, the bill may be taken pro confesso.' The eighteenth rule requires the defendant to file his plea, demurrer, or answer (unless he gets an enlargement of the time) on the rule-day next succeeding that of entering his appearance; and in default thereof the plaintiff may, at his election, enter an order (as of course) in the order-book that the bill be taken pro confesso; and thereupon the cause shall be proceeded in ex parte, and the matter of the bill may be decreed by the court at any time after the expiration of 30 days from the entry of said order, if the same can be done without an answer, and is proper to be decreed; or the plaintiff, if he requires any discovery or answer to enable him to obtain a proper decree, shall be entitled to process of attachment against the defendant to compel an answer, etc. And the nineteenth rule declares that the decree rendered upon a bill taken pro confesso shall be deemed absolute, unless the court shall at the same term set aside the same, or enlarge the time for filing the answer, upon cause shown upon motion and affidavit of the defendant.

It is thus seen that by our practice a decree pro confesso is not a decree as of course according to the prayer of the bill, nor merely such as the com-plainant chooses to take it; but that it is ade (or should be made) by the court, according to what is proper to be decreed upon the statements of the bill assumed to be true. This gives it the greater solemnity, and accords with the English practice, as well as that of New York. Chancellor KENT, quoting Lord ELDON, says: 'Where the bill is thus taken pro confesso, and the cause is set down for hearing, the course (says Lord ELDON, in geary v Sheridan, 8 Ves. 192) is for the court to hear the pleadings, and itself to pronounce the decree, and not to permit the plaintiff to take, at his own discretion, such a decree as he could abide by, as in the case of default by the defendant at the hearing.' Rose v. Woodruff, 4 Johns. Ch. 547, 548. Our rules do not require the cause to be set down for hearing at a regular term, but, after the entry of the order to take the bill pro confesso, the eighteenth rule declares that thereupon the cause shall be proceeded in ex parte, and the matter of the bill may be decreed by the court at any time after the expiration of 30 days from the entry of such order, if it can be done without answer, and is proper to be decreed. This language shows that the matter of the bill ought at least to be opened and explained to the court when the decree is applied for, so that the court may see that the decree is a proper one. The binding character of the decree, as declared in rule 19, renders it proper that this degree of precaution should be taken.

We have been more particular in examining this subject, because of the attempt made by the defendants on this appeal to overthrow the decree by matters outside of the bill, which was regularly taken pro confesso. From the authorities cited, and the express language of our own rules in equity, it seems clear that the defendants, after the entry of the decree pro confesso, and while it stood unrevoked, were absolutely barred and precluded from alleging anything in derogation of, or in opposition to, the said decree, and that they are equally barred and precluded from questioning its correctness here on appeal, unless on the face of the bill it appears manifest that it was erroneous and improperly granted. The attempt, on the hearing before the master, to show that the reissued patent was for a different invention from that described in the original patent, or to show that there was such unreasonable delay in applying for it as to render it void, under the recent decisions of this court, was entirely inadmissible, because repugnant to the decree. The defendants could not be allowed to question the validity of the patent which the decree had declared valid. The fact that the reissue was applied for and granted 14 years after the date of the original patent would, undoubtedly, had the cause been defended and the validity of the reissued patent been controverted, been strongly presumptive of unreasonable delay; but it might possibly have been explained, and the court could not say as matter of law, and certainly, under the decree of the court, the master could not say, that it was insusceptible of explanation. And on this appeal it is surely irregular to question the allegations of the bill. If anything appears in these allegations themselves going to show that the decree was erroneous, of course it is assignable for error; but any attempt to introduce facts not embraced in those allegations, for the purpose of countervailing the decree, is manifestly improper. The introduction of the original patent, pending the appeal, was clearly irregular.

The appellants have called attention to one matter in the allegations of the bill on which they rely, for the purpose of showing that, as matter of law, the reissued patent must be void. It is stated in their tenth assignment of error as follows: '(10) For that, on the face of the bill and the patent, the reissued patent in suit was illegally granted, and therefore void, and the court should have so held; and this court is now asked to so hold, because the bill avers that uring the fourteen years of the original term of the patent the validity of said letters patent was established in numerous suits in the circuit courts of the United States, and that all persons sued took licenses and paid therefor, as well as many others not sued, thereby averring, in substance, that the original letters patent were valid and operative; wherefore, appellants ask this court to hold that the original letters patent, having been valid and operative, as averred by complainant, for over fourteen years, no reissue thereafter could be legally obtained, because invalidity or inoperativeness are conditions precedent to the grant of a reissue.' The answer to this assignment is obvious. The suits brought on the original patent may have been for infringements committed against particular parts of the invention, or modes of using it and putting it into operation, as to which the specification was clear, full, and sufficient; while, at the same time, there may have been certain other parts of the invention, or modes of using it and putting it into operation, as to which the specification was defective or insufficient, and which were not noticed until the application for reissue was made; or, in the original patent, the patentee may have claimed as his own invention more than he had a right to claim as new,-a mistake which might be corrected at any time. At all events, the court cannot say, as mere matter of law, that this might not have been the case.

We think that the objection to the decree going to the validity of the patent and the whole cause of action cannot be sustained.

We are then brought to the proceedings in taking the account. The errors assigned on this part of the case are based on the exceptions taken to the master's report, which have already been noticed. They resolve themselves into two principal grounds of objection: First. That the master allowed the complainant all the profits made by the defendants by the use of the patented machine in folding cloths and strips as compared with doing the same thing by hand; whereas he should only have allowed the profits of using the complainant's patented machine as compared with a single folder, which the defendants allege was open to the public before their infringement commenced. Secondly. That the master, in allowing profits, took no account of the fact that folded strips, such as those used by the defendants, were an article of merchandise, cut and folded by different parties, at a charge of only 25 cents for 144 yards, or about one-sixth of a cent per yard; whereas the defendants were charged with a profit of one-half of a cent per yard.

As to the first of these objections it is to be observed, first, that no evidence was produced before the master to show that, during the period of the infringement, there was open to the public the use of any machine for folding a single edge, which was adapted to the work done by the defendants. The only evidence adduced for that purpose was the letters patent granted to S. P. Chapin, February 19, 1856, and the letters patent granted to J. S. McCurdy, dated February 26, 1856. No evidence was introduced to show that the folding-guides described in those patents were adapted to the folding of strips for corsets, which was the work required by the defendants, and for which they used the complainant's invention. On the contrary, it was proved by the positive testimony of the complainant (and not contradicted) that 'the Chapin device could not be used for folding strips of materials on one or both edges for use upon corsets,' for reasons fully detailed in the testimony; and that 'the McCurdy device is a binder calculated and adapted to fold selvaged-edged goods, such as ribbon and braid, and will fold the strip passing through it in the center only,' 'and cannot be used for folding raw-edged strips of cloth, either on one or both edges.' The complainant also testified that there was no other way known to him (and he testified that he had large experience on the subject) to do work like that done by the defendants, except by hand, or in the use of another patent owned by him, namely, the Robjohn patent, dated April 19, 1864, (which was produced in evidence,) which consisted of a folding-guide, folding one edge in combination with a device for pressing said fold to an edge, and then passing said folded strip through a narrower folder, folding the other edge, and pressing said fold by a pressing device. No evidence was adduced by the defendants to contradict this testimony.

It is proper to remark here that the affidavits presented to the master, and those afterwards presented to the court, as grounds of the respective applications to reopen the proofs, cannot be looked into on this hearing. They form no part of the evidence taken before the master on the reference; and no error is assigned (even if error could be assigned) to the refusal of the court to refer the case back to the master for the purpose of taking further testimony.

The second objection to the report is that the master, in estimating the profits chargeable to the defendants, did not take into account the fact that folded strips, such as those used by the defendants, were an article of merchandise, cut and folded by different parties at a charge of only 25 cents for 144 yards. To this objection it may be observed that the evidence before the master did not show by what process such folded strips were made, nor whether they were not really made by infringing the complainant's patent. As the proof stood before the master, they must have been made by the use of the complainant's machine, for there was no other known machine by which they could have been made at any such cost. And if made by the use of complainant's machine, the inference must be that the persons making them were infringing the complainant's patent, for they are not named in the list of those to whom the complainant had granted licenses, which list was presented before the master at the defendants' request. If made by such infringement they can hardly be set up against the complainant to reduce the amount of profits made by the defendants. There is something singular about this part of the case. If folded strips, suitable for the defendants' purpose, could have been procured in the market by them at such a low price as is pretended, why did they not procure them in that way after being enjoined against using the complainant's machine, instead of making them by the disadvantageous method of using a single folder and folding one edge at a time? Was it from a knowledge of the fact that the persons who folded such strips were infringing the complainant's patent, and a consequent unwillingness to become further complicated in such infringements? At all events, since the defendants chose to make their own folded strips in their own factory, instead of going outside to purchase them, or have them made by others, they cannot justly complain of being accountable for the profits realized in using the complainant's machine for that purpose. It might have been a better financial operation to have bought of others, or employed others to make the folded strips which they required, just as, in the case of the Cawood Patent, the railroad company would have done better not to have mended the ends of their battered rails, but to have had them cut off; but as they chose to perform the operation they became responsible to the patentee for the advantage derived from using his machine. 94 U.S. 710. We do not think that the objection is well taken.

It follows that all the reasons of appeal must be overruled.

No error or ground of appeal is assigned upon the refusal of the court below to refer the cause back to the master for the purpose of reopening the proofs, although some observations on that point are submitted in the brief of the appellants. We think that that matter was fairly addressed to the discretion of the court, and cannot properly be made the ground of obj ction on this appeal. New evidence, discovered after the hearing before the master is closed, may, in proper cases, be ground for a bill of review, on which issue may be joined and evidence adduced by both parties in the usual way. The defendants are not concluded by the refusal of the court, on mere affidavits, to refer the cause back to the master. An examination, however, of the affidavits presented to the court does not convince us that a further inquiry should have been ordered.

In thus considering the case on its merits, as presented by the evidence taken before the master, his report thereon, and the exceptions to such report we have deemed it unnecessary to make any remarks as to the status of a defendant before a master on a reference under a decree pro confesso. Both parties in this case seem to have taken for granted that the rights of the defendants were the same as if the decree had been made upon answer and proofs. In the English practice, it is true, as it existed at the time of the adoption of our present rules, (in 1842,) the defendant, after a decree pro confesso and a reference for an account, was entitled to appear before the master and to have notice of and take part in the proceedings, provided he obtained and order of the court for that purpose, which would be granted on terms. 2 Daniell, Ch. Pr. (1st Ed.) 804; Id. (2d Ed. by Perkins,) 1358; Heyn v. Heyn, Jac. 49. The former practice in the court of chancery of New York was substantially the same. 1 Hoff. Ch. Pr. 520; 1 Barb. Ch. Pr. 479. In New Jersey, except in plain cases of decree for foreclosure of a mortgage, (where no reference is required,) the matter is left to the discretion of the court. Sometimes notice is ordered to be given to the defendant to attend before the master, and sometimes not; as it is also in the chancellor's discretion to order a bill to be taken pro confesso for a default, or to order the complainant to take proofs to sustain the allegations of the bill. Nixon's Digest, 'Art. Chancery,' § 21; Gen. Orders in Chancery, XIV., 3-7; Brundage v. Goodfellow, 8 N. J. Eq. 513.

As we have seen, by our eighteenth rule in equity it is provided that if the defendant make default in not filing his plea, demurrer, or answer in proper time, the plaintiff may, as one alternative, enter an order as of course that the bill be taken pro confesso, 'and thereupon the cause shall be proceeded in ex parte.' The old rules, adopted in 1822, did not contain this ex parte clause; they simply declared that if the defendant failed to appear and file his answer within three months after appearance day, the plaintiff might take the bill for confessed, and that the matter thereof should be decreed accordingly; the decree to be absolute unless cause should be shown at the next term. See Equity Rules VI. and X. of 1882, 7 Wheat. vii., and Rendleton v. Evans, 4 Wash. C. C. 336; O'Hara v. MacConnell, 93 U.S. 150. Under these rules the English practice was left to govern the subsequent course of proceeding, by which, as we have seen, the defendant might have an order to permit him to appear before the master and be entitled to notice. Whether under the present rules a different practice was intended to be introduced, is a question which it is not necessary to decide in this case.

The decree of the circuit court is affirmed.