Wicker v. Hoppock

ERROR to the Circuit Court for Northern Illinois.

Caldwell being owner of a distillery, subject to a mortgage to Hoppock, leased it to Chapin & Co. for three years; it being agreed by the lease itself that the rent, so much a year, should be paid by Chapin & Co. directly to Caldwell the mortgagee, so as to keep down in part the interest on the mortgage. Chapin & Co., after being for about eighteen months in occupation of the distillery, and accumulating at it a considerable amount of personal chattels, such as are commonly used about such a place, assigned the lease to one Wicker under some sort of partnership arrangement, and Wicker went in. The rent not having been paid, according to his agreement, by Chapin & Co. to Hoppock, the mortgagee, Hoppock applied now to Wicker to pay it, giving him to understand that unless he did pay it, suit of foreclosure would have to be brought on the mortgage, and he dispossessed. After some negotiations, Wicker, who it seemed was desirous of becoming owner of the personal chattels which Chapin & Co. had left at the distillery, agreed with Hoppock that if he, Hoppock, would sue Chapin & Co. for the amount of rent in arrear and obtain judgment and levy on the property, he, Wicker, 'would bid it off for whatever the judgment and costs might be.' Hoppock did accordingly sue and obtain judgment against Chapin & Co.; the judgment having been for $2206. Chapin & Co. were indebted also to Wicker on some transactions growing out of the distillery; and Wicker, who asserted himself to have advanced money on it, caused most of the property already mentioned as left by Chapin & Co., to be removed to Chicago Hoppock's counsel meaning to proceed with his execution, gave notice to Wicker of the intention to sell and of the day of sale. Wicker, however, did not attend the sale, nor was any bid made in his name. And all the property of Chapin & Co. that was there and could be levied on was knocked down to Hoppock, the only bidder, for the sum of two dollars. Thereupon Hoppock brought assumpsit in the Circuit Court for Northern Illinois-the suit below-against Wicker to recover damages for the breach of his agreement to appear at the sheriff's sale and bid off the property levied on for the full amount of the judgment for which the execution issued.

The court below, against requests by the defendant's counsel to charge otherwise, considered and charged—

1. That the agreement between Hoppock and Wicker was not invalid as tending to prevent the fairness of a judicial sale, and therefore against public policy.

2. That the measure of damages was the amount of the judgments with interest and costs.

The case was now here on writ of error by Wicker, for a review on these points.

Mr. C. H. Reed, for the plaintiff in error:

The agreement between Wicker and Hoppock was invalid because calculated to interfere with, and prevent the fairness and freedom of a judicial sale; and prevent competition, and therefore against public policy.

1. The law guards all judicial sales with jealous care, and any agreement or understanding, that any one person competent to bid will abstain from bidding, will not be enforced, no matter how pure the motive moving to such agreement. It matters not even if the defendant in the writ assents to such agreement, for his creditors, as well as himself, have a right to say that nothing shall be done tending to sacrifice his property. In this case, by carrying out the agreement, Hoppock could not bid at the sale. It is no answer to say that Hoppock was not bound to bid, and might not have done so even if there had not been this agreement. It is sufficient to say, that independently of this agreement (which in its spirit did put him under an obligation to leave all bidding to Wicker), he was competent and at liberty to bid.

2. As to the measure of damages. Hoppock himself now holds the judgment against Chapin & Co., in full force, except as to the two dollars bid by himself; and he holds at the same time a judgment against Wicker for the full amount of such judgment, and he holds over and above both the property sold to him at the sheriff's sale. And he would seem to have the right to hold on to and enforce and enjoy all unless this judgment against Wicker be reversed; for Wicker does not stand in the relation of surety for Chapin & Co., nor is he in any position upon any known principle of law or equity, to be subrogated to the judgments against them, on paying the judgment against himself. This singular result is the consequence of the erroneous rule of damages adopted by the court below. It arose out of a departure by the court from that salutary and elementary principle, that in all actions upon contract, 'the damages are strictly limited to the direct pecuniary loss resulting from a breach of the agreement in question.'

If Chapin & Co. were solvent, and they are presumed to be, then the direct pecuniary loss sustained by Hoppock by the failure of Wicker to bid, was but nominal, as his judgments would be worth par, and they could be worth no more had Wicker fulfilled his agreement. If they were good for a portion, then Hoppock's direct pecuniary loss was only equal to the balance. Whatever the property was worth that Hoppock bid off at the sheriff's sale, should also be deducted from his direct pecuniary loss, for had Wicker bid it off, Hoppock certainly could not. Yet without any reference to these questions, the court below instructed the jury peremptorily to find as damages the full amount of the judgments and interest.

Mr. S. W. Fuller, contra:

1. The rules relied on by the other side about judicial sales only forbid agreements made with a fraudulent purpose, and agreements not to bid at such sales. See specially in the Supreme Court of Massachusetts, Phippen v. Stickney; in that of New York, Bame v. Drew, and in Illinois, Garrett v. Moss et al.

2. The amount which would have been received if the contract had been kept, is the measure of damages, if the contract is broken.

Mr. Justice SWAYNE delivered the opinion of the court.