Opinion
03-31-1871
KRAKER v. SHIELDS.
Hallyburton and Lyons, for the appellant. Henry A. Wise and Fitzhugh, for the appellee.
Joynes, J., absent.
1. In November, 1862, S. sells to K. a house and lot in Richmond, for $14,500, of which $4,500 is paid in cash, and notes with interest for the balance are given, payable in one, two, three and four years, with a deed of trust to secure them. The cash payment, and first and second notes, are paid in Confederate money, the third is paid four months before it fell due by a compromise, S. taking for it $2,000 in U. S. currency. Bill to enjoin the sale of the house and lot for the payment of the fourth note, alleges that it was given with reference to Confederate currency as the standard of value, and prays that S. might be required to receive payment according to the value of that money at the time of the contract. S. denies this was the contract, and says he was to be paid in the currency of the time the note fell due, and asks the court to adjudicate the question. HELD:
1. The court may refer the case to a commissioner, to enquire whether the contract was made with reference to Confederate money as a standard of value, or whether the notes were to be paid in the currency of the time they fell due.
2. It is not a case in which the court should have directed an issue. And this especially as there was no conflict of testimony when the case was referred to a commissioner.
3. In what cases court may refer a case to a commissioner, see the opinion of Moncure, P.
4. The interest being included in the note, if there is a decree for the payment of the note, it is proper to decree interest on the whole amount.
5. The court being of opinion that the note should be paid in the currency of the time it fell due, may decree in favor of S. against K. for the amount.
6. It was irregular, after decreeing in favor of S., to dismiss the bill; and the appellate court will correct the decree in this respect, and affirm it, with costs:
7. The decree should reserve liberty to S. to apply to the court, by motion or petition in the cause, for a sale of the house and lot under the trust, if the personal decree against K. failed to produce the money: This, too, the appellate court will correct, and affirm the decree.
On the 21st day of November, 1862, James H. Shields sold to Meyer Kraker a house and lot in the city of Richmond, for the sum of $14,500; of which the sum of $4,500 was paid down, and for the balance, $10,000, four negotiable notes were given, at twelve, twenty-four, thirty-six, and forty-eight months after date, each for the sum of $2,500, with interest added from the date to the maturity of the note: the first being for $2,650, due 21st November, 1863; the second being for $2,800, due 21st November, 1864; the third being for $2,950, due 21st November, 1865; and the fourth being for $3,100, due 21st November, 1866.
On the day of sale the property was conveyed to the purchaser, who thereupon conveyed it to a trustee to secure the deferred instalments of the purchase money. Nothing is said in the notes or the deeds about the currency in which payment of the money was to be made, but the money is described generally as so many dollars. The cash payment was made in Confederate notes. The first deferred instalment, due 21st November, 1863, and the second, due 21st November, 1864, were paid at maturity, in Confederate notes. The third, due 21st November, 1865, was settled more than four months before it became due, by a compromise effected through the agency of Mr. Wellington Goddin, employed by Kraker for that purpose. By that compromise the sum of $2,000 in legal currency was paid and received in discharge of the note of $2,950. When the fourth and last deferred instalment became due, which was on the 21st of November, 1866, Shields demanded payment in legal currency, but Kraker refused to pay in such currency, and insisted that the amount of the note should be scaled, according to the provisions of the act of the General Assembly passed March 3, 1866, Session Acts 1865-'6, p. 184, chap. 71; the said Kraker contending that the contract was, according to the true understanding and agreement of the parties, to be fulfilled or performed in Confederate States treasury notes, or was entered into with reference to such notes as a standard of value.
The parties being thus at issue as to their relative rights and obligations in regard to the last note, James M. Taylor, the trustee named in the deed of trust, proceeded, at the request of Shields, to execute the trusts of the deed, by causing the property thereby conveyed to be advertized for sale on the 8th day of April, 1867.
On the 28th day of March, 1867, Kraker filed his bill in chancery against Shields and Taylor, in which he said that he was " ready and willing to pay off the said last note at the rate of one dollar in legal tender notes for three of Confederate treasury notes; that the contract for the purchase of the said real estate, according to the true understanding and agreement of the parties, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value; and your orator is advised that, by the law of the land, he is not required to pay at a greater rate than that above mentioned." He charged that, notwithstanding the premises, the said Taylor, trustee in the said deed of trust, had " advertised the said property to be sold at public auction on the 8th day of April next, as will appear by the printed advertisement bearing date March 27th, 1867," and exhibited with the bill. He said he was advised that if he had no other ground upon which to injoin the sale, " he might do so upon the sole ground that the advertisement does not conform to the requirements of the deed of trust, in this, that the deed requires that the property shall be advertised for twenty days before sale, and the said Taylor has only given twelve days' notice at most:" and therefore, to the end that full and complete justice might be done in the premises, he prayed that the said sale might be enjoined, that the said Shields might be compelled to receive payment of the said last note as above proposed by the complainant, and that the latter might have general relief.
An injunction was accordingly awarded.
On the 6th day of May, 1867, the defendants filed their answers.
The defendant Shields denied " that the contract for the purchase of said real estate, according to the true understanding and agreement of the parties, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value." On the contrary, he charged " that the true understanding and agreement of the parties was, expressly, that the said notes, for the deferred instalments of purchase money, were to be paid in the money current at the time the said notes respectively matured." He said that he, " in good faith and in accordance with the said last-mentioned understanding and agreement, did receive Confederate States treasury notes in payment of all the notes that matured while that money was current in Richmond, although the same had become greatly depreciated, as compared with the value of that money when the said sale was made." He charged and claimed, " that according to the true understanding and agreement of the parties, at the time of said contract and sale, the said note for $3,100, now due and unpaid as aforesaid, was to have been, and ought to be, paid in full, in the legal-tender notes now current, and ought not to be scaled at all." He charged further, " that, in consequence of the agreement and understanding as to the currency in which payment was to have been made, and the fact that they extended through a period of four years from the date of said sale, and the parties could not anticipate the character of money in which the payments would be made, there was not the difference between the actual value of said property in coin and its value in Confederate money that was usually made in the sales of real estate in the fall of 1862." He admitted " that the said deed of trust does require that the property therein mentioned shall be advertised for twenty days, and that the said Taylor, as trustee, only gave about twelve days' notice, as alleged in said bill." He said he was informed, and believed that the said sale " was so advertised through inadvertence and mistake of the said trustee." But, admitting this, he prayed the court " to adjudicate and settle the questions in controversy between the complainant" and himself, " independent of and additional to that involved in the advertisement of the sale above mentioned," as he was advised " that said questions are, all of them, the proper subjects of equitable jurisdiction and relief, in such a case as this."
The defendant Taylor, in his answer, showed that " it was through inadvertence and mistake that only about twelve days' notice of the sale was given in the advertisement, instead of twenty days, as required by the deed of trust."
On or about the 28th of November, 1868, three depositions were taken and filed in the cause; that of Wellington Goddin, in behalf of the plaintiff; and those of James W. Shields, one of the defendants, and D. J. McCormick, in behalf of the defendants.
1. Wellington Goddin proved that from November 1st, 1862, to April, 1865, Confederate treasury notes were the only currency in circulation in Richmond, and all other parts of the State under the control of the Confederate government. During that period, he was extensively engaged in the sale of real estate in the said city, and nearly if not all the sales made by him were made with reference to funds current in the several banks then in existence in the city; and as these banks received and paid out nothing but Confederate treasury notes, that was the kind of currency he expected to receive for all payments made to him during the period aforesaid: as far as his experience went, in the absence of any special contract to the contrary, the purchase money was to be paid in such funds as the several banks in Richmond were in the habit of receiving on deposit at the time of the maturity of the obligation, or the time of the payment of the debt. Being asked by the counsel for the plaintiff, " when sales of real estate were made during the period mentioned, unless it was expressly understood otherwise between buyer and seller, were or were not the deferred payments universally understood to be payable in Confederate treasury notes?" he answered: " No, sir; according to my experience during that period, if the terms of sale required cash, Confederate treasury notes would have been received in payment, because such funds were current in all the banks of the city at that time; if the terms of sale were partly cash and partly on credit, the credit payments were to be discharged in such funds as the said banks were in the habit of receiving at the time of the maturity of such payments." Being asked, on cross-examination, " What was the currency or circulation receivable in the banks of Richmond in November, 1865, and November, 1866?" he answered, " By the fall of the Confederacy, in April, 1865, all the State banks then in Virginia were destroyed; in a few months thereafter a few national banks were established in the city; and in November, 1865, and November, 1866, Federal currency, sometimes called greenbacks, constituted the only currency in this city." The witness then gave an account of the compromise he had effected, as agent of the plaintiff, with the defendant Shields, of the third deferred instalment due on the 21st of November, 1865; after which he stated that he was well acquainted with the value of the house and lot in question in November, 1862, and also in November, 1865 and 1866. According to his best judgment, the specie value of the property before the war was about $10,000, and he thought it was worth in specie, in November, '62, what it was worth prior to the war. In the summer of 1865, and thereafter till the close of the year, real estate in the city sold at higher prices than had been obtained for many years before. In his opinion, this property would have sold, in November, 1865, for between $15,000 and $16,000. Real estate continued to sell high till the spring of 1866, when it began to recede, and has continued since to decline. In his opinion, in November, 1866, the property would have brought, in " greenbacks," from $10,000 to $12,000. Such was the depressed condition of real estate in the city at the time of giving his deposition, that the property would not then sell for more than $7,000 or $7,500.
2. D. J. McCormick proved that he has resided in Richmond since March, 1862. A week or a few days before Kraker purchased the lot of Shields, Kraker and witness went to the workshop where Shields was working, to see about the property. Witness gave the following account of that visit and interview: " We talked a great deal on the way going there, and at the workshop. I do not recollect that there were any terms asked for concerning the property, but I remember telling Mr. Kraker, at the shop, to buy the property, if possible, for cash. If not, to make as short notes as possible--short time as possible; telling him, at the same time, that the war would be over in perhaps less than two years, and Mr. Shields, after the war, would have as much interest in the property as it would then be worth. I told him that I thought Mr. Shields was a very smart man, and that if he would sell all his property in that way he would do well, as he would have a large income during the war, and his property, perhaps, be of full value after the war, with these notes resting upon him." Witness proved that Kraker offered to pay Shields cash for the property, but Shields refused, saying he would not sell for cash.
3. James W. Shields deposed, among other things, as follows: " Mr. Kraker came to me, and desired to purchase the middle tenement of the Mansion House, owned by me, on Main street, and desired to know on what terms I would sell it. I told him, as well as I recollect, that I would take $14,500: I think, $4,500 cash, the balance in one, two, three and four years, secured by deed of trust, with four negotiable notes, bearing even date therewith, and with interest from the date, negotiable and payable in bank, in whatever was current at the time the notes became due. He then demurred from that, and desired to purchase for cash. I declined to sell on any other terms than the terms stated. He said that he would give me a decisive answer the next day. He called and concluded to purchase the property on those conditions, and I sold it to him on those conditions; and, since the making of the contract, I have received the depreciated currency for the notes as they became due, consisting of two notes in full, and the third note, a part of it was received by way of compromise in " " " greenbacks." He desired to give me his individual note, with personal security, for the fourth note, payable in greenbacks, if I would release the deed of trust. The contract for the house was made about the 18th of November, 1862, and executed about the 21st of November, 1862." " I had an offer from Mr. Litchenstein of $14,000 cash. This was some few months before I sold to Kraker, and refused it. I would not sell for cash. I had, also, an offer from Mr. Jacobs to purchase for cash; but, as I peremptorily told him I would not sell for cash, no particular amount was named." Being asked, " Why would you not sell for cash?" witness answered, " Because money was depreciating every day, and I expected that, in a year or so at most, I would get a better currency." Being asked, " Did you assign any reason to Mr. Kraker for declining to take cash, and, if so, what reason?" witness answered, " I think I told Mr. Kraker, am pretty certain of it, it is a long time since, that I wouldn't sell for cash, because I thought that in a year or two the currency would be better. If he chose to take it at that risk, he could do so. I wasn't anxious to sell the property." After stating that he had received the cash payment, and first two deferred instalments, falling due in November 1863 and 1864, in Confederate currency, and the third instalment, falling due in November 1865, in part in greenbacks by a compromise, he was asked, " How did this compromise or settlement occur between you?" to which he answered, " I was pressed for money at that time, and went to him a little while before this third note was due. I offered to knock off $150 from the face of that note, if he would cash it and pay me the balance. He told me he would give me an answer that evening. He went to Mr. Wellington Goddin, and employed him to manage the matter for him. Mr. Goddin said that any settlement he would make, Mr. Kraker would abide by. The money was paid in the presence of Mr. Goddin, by his award and settlement between us." Being enquired of, as to the grounds of the compromise, he answered, it was " according to the value, as well as I recollect, of the property." Being asked whether either of the houses adjoining on either side of the tenement in question was sold in 1865, he answered, " There was one about three doors below. I think Straus's house was sold in 1865 or '6, a much inferior house, for $17,000, at public auction."
In this state of the cause, it came on to be heard on the 8th day of February, 1869, on the bill and exhibits, the answers and general replications thereto, and the depositions of the witnesses aforesaid, when the court decreed " that this cause be referred to one of the commissioners of this court, to ascertain and report, whether the contract for the purchase of the real estate in the bill and proceedings mentioned, according to the true understanding and agreement of the parties thereto, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value; or whether the notes given by the complainant, as alleged in the bill and proceedings, for the deferred instalments of the purchase money of said real estate, were to be paid, according to the true understanding and agreement of the parties, in whatever money was current at the time the said deferred instalments, respectively matured, and became due and payable. And the said commissioner is also required to ascertain and report which, if any, of said deferred instalments of purchase money are now in arrear and unpaid, and the amount thereof, as appears by the face of the papers; and what money was current at the time the same became due and payable. And the said commissioner is directed to make his report on the matters above referred to, with all convenient speed, together with anything deemed pertinent by himself or specially required by any of the parties."
On the 18th of February, 1869, commissioner Pleasants made a report under the aforesaid decree; and reported, 1st. That the notes given by the complainant, as alleged in the bill and proceedings, for the deferred instalments of the purchase money of the said real estate, were to be paid, according to the true understanding and agreement of the parties, in whatever money was current at the time the said deferred instalments, respectively matured, and became due and payable; 2dly. That the fourth or last of said deferred instalments, amounting, as appears by the face of the papers, to $3,100, with interest thereon from the 24th day of November, 1866, until paid, is now in arrear and unpaid; and, 3dly. That at the time the said deferred instalment, which is still in arrear and unpaid, became due and payable, federal currency, sometimes called greenbacks, constituted the only currency in the city of Richmond.
To this report two exceptions were taken by the plaintiff's counsel.
On the 25th of February, 1869, the cause came on again to be heard upon the papers formerly read, and upon the report of commissioner Pleasants and the exceptions thereto, on consideration whereof the court recommitted the said report to the said commissioner on the exceptions thereto, and directed him to report to the court the reasons upon which the conclusions in his said report are founded. And the said commissioner was further directed to take any additional evidence that might be offered by either party, and to report to the court his proceedings under the said order, with any matter deemed pertinent by himself or required to be reported by either of the parties.
On the 5th of March, 1869, commissioner Pleasants made his report under the last mentioned order, and there were returned with his report two depositions taken before him, both of them in behalf of the plaintiff; to wit, the deposition of the plaintiff himself, Meyer Kraker, and that of his brother Julius Kraker. M. Kraker deposed that there was no understanding between himself and Shields, except what was in the contract, about the kind of money in which the payments were to be made. The property, at the time he bought it, was worth about five thousand or five thousand five hundred dollars in gold. It was in very bad condition at that time, and when he took possession of it, about half a year thereafter; the repairs have cost him about $2,000 in good money. He did not offer to pay Shields for the property in cash in Confederate money. Mr. McCormick advised witness to pay cash for the property, telling him that it would be a great thing for him to do so. But witness had not the money to pay for the property in cash, and so told Mr. McCormick.
Julius Kraker deposed that he was well acquainted with the property, and presumed that its value in gold at the time of the said purchase, was between five and six thousand dollars. There were also two papers returned with said report marked " Y" and " X," the former being an extract from the books of the auditor's office in Richmond, showing that the said property was assessed on those books for 1860 at $8,992; and the latter being an extract from the deed conveying the said property to Shields, dated 20th February, 1854, showing the consideration of the deed to be $7,800. The commissioner reported his reasons at length for his former report, and that upon the new evidence taken, there did not appear to be any ground for changing it. He therefore reä dopted his former report, and made it a part of his last report.
To this last report the plaintiff's counsel again excepted.
On the 9th of March, 1869, the cause came on again to be heard, when the court overruled the complainant's said exceptions to the said reports respectively, and decreed that the said reports be confirmed, and that the defendant Shields recover against the plaintiff Meyer Kraker the sum of $3,100, with legal interest thereon from the 21st day of November, 1866, until paid, and his costs by him about his defence in that behalf expended; and the court further decreed that the injunction be dissolved and the bill dismissed.
On the 12th of March, 1869, " it appearing to the satisfaction of the court that the several deferred instalments of purchase money in the bill and proceedings mentioned were, according to the true intent and meaning of the parties, to be discharged in the money current at the times of the maturity of said instalments respectively, and that all of said instalments have been paid except the last, which is the subject of litigation in this cause; that said last instalment matured on the 21st day of November, 1866, on which last named day the money known as United States legal tender notes, and the notes issued by the several national banks of the United States, constituted the money current at that time, and which were of equal value, the court ordered that the said decree of the 9th of March, 1869, in favor of the defendant Shields against the plaintiff Meyer Kraker, should be so amended and modified as that the same may be discharged in such lawful money of the United States.
From the said decree the plaintiff applied for an appeal to this court, which was allowed.
Hallyburton and Lyons, for the appellant.
Henry A. Wise and Fitzhugh, for the appellee.
MONCURE, P., after stating the case, proceeded:
There are five assignments of error in this case, which are as follows: 1st. " The case was one not proper for a reference to a commissioner." 2d. " The court should have ordered an issue to be tried before a jury." 3d. " It was error to render a decree in favor of the defendant against the plaintiff." 4th. " The decree is erroneous, in being for interest upon the whole sum called for by the note, a part of it being interest, and therefore not bearing it, such interest being compound." And, 5th. " The decree, upon the testimony, should have been in favor of the plaintiff, if any was rendered without a jury."
I will consider these assignments of error in their order. But, before I do so, it seems to be proper, by way of explanation, to say something in regard to Minnie N. Kraker, wife of Meyer Kraker, and a co-plaintiff in the suit and co-appellant in the appeal. A great deal is said about her in the record; and in the earlier period of the litigation her interest in the subject seemed to be a matter of some importance. Her husband caused the property to be conveyed to her, and the notes and deed of trust to be executed in her name; the vendor, Shields, believing that the property was conveyed to her husband, and that the notes and deed of trust were executed by him and in his name. Shields complained that a fraud was practiced upon him in this respect; but Kraker denied that any such fraud was intended. But however that may be, it seems to be conceded by the parties, and properly so, that her rights, if she have any, and whatever they may be, are in subordination to those of Shields, to whom her husband and the property are liable for the purchase money, just as if the property had been conveyed to him in his own name, and as if he, in his own name, had executed the notes and deed of trust. Her name, therefore, need not be noticed, either in the statement of the case or in this opinion, though possibly I may have occasion to refer to it again before I conclude. I will now proceed to consider the assignments of error; and,
1st. That " the case was one not proper for a reference to a commissioner."
The Code, chapter 175, § 2, provides for the appointment of commissioners in chancery, but does not prescribe their particular duties, except as to taking accounts. It declares that " each court may, from time to time, appoint commissioners in chancery, or for stating accounts, who shall be removable at its pleasure; there shall not be more than three such commissioners in office at the same time, for the same court." § 4 declares that " every commissioner shall examine and report upon such accounts and matters as may be referred to him by any court." The act to establish Circuit Superior courts, passed April 16th, 1831, provided that the said courts " shall have power to appoint commissioners in chancery, not exceeding two for each court, for taking and reporting such accounts or other matters as such courts shall commit to them to be examined, stated and reported." Sup. to R. Co. 1819, p. 164, § 76. The duties of a commissioner in chancery in this State are considered to be, generally, the same with those of a master in chancery in England, whose duties are set forth in the books of chancery practice in that country; as, for instance, in 2 Daniel's Chancery Pl. and Pr., see. 7, pp. 1345-1503. That writer, in pointing out the course to be pursued in the Master's office, upon the particular reference before him, says: " The objects, however, for which references to a Master may be made, are so numerous and various, that it would be impossible, in a treatise of this nature, specifically to detail the course of proceeding which should be adopted in each; " and he therefore confines his attention to the most usual subjects of reference, by analogy to which the proper steps to be pursued in other cases may be inferred. " References to the Master upon decrees or decretal orders," he says, " are either--1. To make enquiries; 2. To take accounts and make computations; or, 3. To perform some special ministerial acts directed by the court. Inquiries by the Master are directed either to persons or to facts, though sometimes they are directed to matters of law; but it is, in general, in those cases only where the law comes in as a matter of fact, as in the case of an enquiry into the law of a foreign country, that the Master is ever directed to enquire into the law; the habit of the court not being to refer abstract questions of law to the opinion of the Masters. Sometimes, however, questions of law are so mixed up with the fact to be ascertained, that it is not possible to decide upon the one, without giving an opinion as to the others. In such case, the Master is bound to give his opinion upon the law, as well as upon the matter of fact referred to him; as, in the case of a reference to a Master to enquire whether a good title can be made to land, & c. The most usual cases in which inquiries as to persons are directed to be made by a Master, are those in which it is necessary to ascertain the heir at law or next of kin of a deceased person. The same sort of enquiry is also frequently directed for the purpose of ascertaining the individuals forming a particular class," & c. " A similar inquiry is also necessary where it is referred to the Master to take an account of the debts due by a particular individual, such account involving, necessarily, an inquiry who the creditors are, as well as into the amount of their claims." Id. p. 1399-1400. See also 1 Smith's Ch. Pr., pp. 10 and 11, and 2 Id. p. 96; 1 Barbour's Ch. Pr. 468.
The question when it is proper, or may be useful, to resort to the aid of a commissioner, is one which addresses itself to the sound discretion of the court, and as to which a large latitude of discretion must be allowed to the court; though of course the court ought to exercise such discretion soundly, to prevent unnecessary expense or delay; which seem to be the chief, if not the only evils, of an improper reference. The court is responsible for the correct decision of the cause, and cannot shift such responsibility from its own shoulders to those of a commissioner. But it can avail itself of the assistance of a commissioner to prepare the cause and place it in the best possible state to enable the court to decide it correctly. The most invaluable assistance may be afforded to the court by the agency of an intelligent, skilful, and experienced commissioner. He has often an advantage, which the court has not, in seeing and hearing the witnesses give their testimony, and being thus better able to judge of its weight. And where he acts only on the proofs already in the cause, as he often does, he may afford important aid to the court by deducing the material facts of the case from a large mass of testimony, and enabling counsel, by means of exceptions to his report, to make up and present to the court the only issues requiring its decision in the cause.
According to the foregoing principles, I do not think the Circuit court erred in referring the cause to one of its commissioners, " to ascertain and report whether the contract for the purchase of the real estate in the bill and proceedings mentioned, according to the true understanding and agreement of the parties thereto, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value; or whether the notes given by the complainant, as alleged in the bill and proceedings, for the deferred instalments of the purchase money of said real estate was to be paid, according to the true understanding and agreement of the parties, in whatever money was current at the time the said deferred instalments, respectively matured, and became due and payable; " nor in the other directions given to the commissioner, by the decree of the 8th of February, 1869. If there were any such error, it was certainly not to the prejudice of the appellant.
2d. That " the court should have ordered an issue to be tried before a jury."
I do not think that the case was a proper one for an issue. There was no conflict of testimony in the case when it was referred to a commissioner. The only testimony then taken, was that of Goddin, for the plaintiff, and that of Shields and McCormick, for the defendant. And, even after the depositions of the two Krakers, Meyer and Julius, were taken by the commissioner, there was not such a conflict in the testimony as to make an issue necessary or proper. Even where there is a conflict of evidence, it does not necessarily follow that there must be an issue; but the court may decide the cause without one, if its conscience is satisfied. 2 Rob. Pr. old ed. 354, and cases cited. In the case of a bill, contesting the validity of a will, a court of equity is bound to have the issue which is made up tried by a jury. But, in other cases, the court will determine, according to its discretion, whether it does or does not want the assistance of a jury. Id. p. 352. Of course the court must exercise its discretion soundly. The court may often, at its election, direct an issue, or refer a question to a commissioner. There are some questions which seem more properly to belong to a jury, if indeed they do not belong exclusively to a jury, in case the conscience of the court is not satisfied; such, for example, are questions involving fraud, or the genuineness of a deed. Id. On the other hand, there are questions which seem more properly to belong to a commissioner, although they may be made the subjects of an issue: as, for instance, a question as to rents and profits of land in controversy in a suit in equity. Id. 362; Green, J., in Newman v. Chapman, 2 Rand. 93, 106.
3d. That " it was error to render a decree in favor of the defendant againt the plaintiff."
It is a general rule that no person but a plaintiff can entitle himself to a decree; but it is admitted that there are exceptions to this rule. In a bill in equity for an account, both parties are deemed actors, when the cause is before the court upon its merits; and, if a balance is ultimately found in favor of the defendant, he is entitled to a decree for such balance against the plaintiff. 1 Story's Eq. § 522. A plaintiff, by applying to a court of equity for an account, subjects himself to a decree for any balance which may be found due from him to the defendant. 2 Rob. Pr. old ed. p. 405. This is not the only exception to the rule; but any case, falling within the same principle, is for the same reason an exception to it. This case falls within the same principle. The plaintiff might have filed his bill solely upon the ground that less than twenty days notice of the sale, as required by the deed, had been given by the trustee; and upon the admission in the answer of the fact of such defective notice, a sale under that notice would have been perpetually enjoined. Indeed, if that had been the only ground of the plaintiff's complaint, he might have obtained relief without coming into court for it. The defective notice was no doubt given by inadvertence merely, as the defendants alleged; and the error would, therefore, have been corrected on request. But the plaintiff had other grounds of complaint, which would have carried him into a court of equity to stop a sale under the deed of trust, if there had been no ground of objection to the notice. He charges in his bill, " that all the notes mentioned in the said deed of trust, except the last, have been fully paid off by your orator, and he is now ready and willing to pay off the said last note at the rate of one dollar in legal tender notes for three of Confederate treasury notes; the contract for the purchase of the said real estate, according to the true understanding and agreement of the parties, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value; and your orator is advised that, by the law of the land, he is not required to pay at a greater rate than that above mentioned." And he prays, among other things, that the court would compel the said Shields to accept the sum in legal tender notes, as above proposed, and grant such other and further relief as the case might require. On the other hand, the defendant Shields, in his answer, " denies that the contract, for the purchase of said real estate, according to the true understanding and agreement of the parties, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value. On the contrary," he " charges that the true understanding and agreement of the parties was, expressly, that the said notes for the deferred instalments of purchase money were to be paid in the money current at the time the said notes respectively matured." And he prays the court " to adjudicate and settle the questions in controversy between" the parties, " as he is advised that the said questions are all of them the proper subjects of equitable jurisdiction and relief in such a case as this." To this answer the plaintiff replied generally; and the parties, being thus at issue upon these questions, proceeded to take evidence to sustain their respective views, and the case progressed to a final decree, which turned out to be in favor of the defendant. He is entitled to the benefit of it, as he would have been bound by it, if it had turned out to be against him. Both parties invoked the decision of the court upon their controversy, which was a proper subject of equitable jurisdiction, properly brought before the court, and both ought to abide the result. " The court," it is said, " had no authority to render any decree, except to perpetuate the injunction, or dissolve it and dismiss the bill. The record now exhibits," it is further said, " the singular case of a bill dismissed, with costs, which put the case out of court, and yet a moneyed decree in favor of the defendant, with no bill or petition to sustain it."
The true relative position of the parties to the suit was reversed by the manner in which the controversy arose. The defendant was the creditor, and was in substance the plaintiff; while the nominal plaintiff was the debtor, and was in substance the defendant in the suit. The court, having adjudicated the controversy and determined that the plaintiff owed to the defendant a certain sum of money and interest, properly rendered a personal decree therefor, notwithstanding the real estate for which the money was due was also liable for its payment. If any other reason were required to vindicate the propriety of such a decree, it might be found in the fact that the plaintiff caused the property to be conveyed to his wife, who may therefore be entitled to it unless the sale of it be necessary to satisfy the defendant's demand, in case the personal decree rendered therefor should prove ineffectual in whole or in part. If it could be said in this case, as was said in Mettert's adm'or v. Hagan, 18 Gratt. 231, that according to the strict rules of pleading, a cross bill was necessary, it might at least as well be said here as there, that the answer " may, for that purpose, be treated as a cross bill, so as to enable the court to do complete justice in this cause." The dismission of the bill was irregular. But that irregularity can easily be cured by amending the decree.
I do not think there is anything in the case of Medley v. Pannill's adm'or, 1 Rob. R. 63, cited and relied on by the learned counsel of the appellants, to show that it was error to render a decree in favor of the defendant against the plaintiff in this case, which is at all in conflict with what I have said on the subject. The decision in that case was founded on peculiar circumstances which are set forth in the opinion of Judge Allen therein, and do not exist in this case.
4th. That " the decree is erroneous, in being for interest upon the whole sum called for by the note, a part of it being interest, and therefore not bearing it, such interest being compound."
There was no agreement to pay compound interest. The interest on the deferred instalments for the time they had to run was added to the principal, and notes taken for the aggregate amounts respectively. Default having been made in the payment of the last note, the whole amount of it properly bears interest from the day it became payable. There is nothing usurious or illegal in this. In fact, the interest included in the notes is a part of the purchase money of the land, and in effect principal.
5th. That " the decree, upon the testimony, should have been in favor of the plaintiff, if any was rendered without a jury."
The bill alleges that " the contract for the purchase of the said real estate, according to the true understanding and agreement of the parties, was to be performed in Confederate States treasury notes, and was entered into with reference to such notes as a standard of value." The answer denies this allegation in the very words in which it is made; and charges, on the contrary, " that the true understanding and agreement of the parties was, expressly, that the said notes for the deferred instalments of purchase money were to be paid in the money current at the time the said notes respectively matured." If the case had stood alone upon bill and answer when the decree for a reference was made, there could have been no doubt of the defendant's right to a decree, according to his version of the contract. How was that right affected by the evidence which was then in the cause? But three witnesses had then been examined; one of them, Wellington Goddin, for the plaintiff, and the other two, McCormick, and Shields himself, for the defendant. Goddin knew nothing about the contract, and testified chiefly as to a compromise of the third note before it became due; which has no material bearing upon the case. But being asked by the plaintiff " When sales of real estate were made during the period mentioned," which was from November 1, 1862, to April, 1865, " unless it was expressly understood otherwise between the buyer and seller, were or were not the deferred payments universally understood to be payable in Confederate treasury notes?" He answered, " No, sir; according to my experience, during that period, if the terms of sale required cash, Confederate treasury notes would have been received in payment, because such funds were current in all the banks of this city at that time. If the terms of sale were partly cash and partly on credit, the credit payments were to be discharged in such funds as the said banks were in the habit of receiving at the time of the maturity of such payments." This evidence certainly supports the view taken in the answer. As to the two witnesses examined for the defendant, McCormick testified that he urged the plaintiff to buy the property, if possible, for cash; if not, on as short credit as possible; and that the plaintiff accordingly offered to pay cash, but Shields refused to sell the property for cash. The reason of the witness for giving this advice is plainly apparent, and must have been known to the plaintiff. Witness says he told " him, at the same time, that the war would be over in perhaps less than two years, and Mr. Shields, after the war, would have as much interest in the property as it would then be worth." The defendant, Shields, testified to the facts stated in his answer. He said that some few months before he sold the property to the plaintiff, Mr. Latchenstein offered him $14,000 cash for it, but he would not sell for cash. He had also an offer from Mr. Jacobs to purchase for cash, but peremptorily told him he would not sell for cash. His reason for not selling for cash was, because money was depreciating every day, and he expected that in a year or so, at most, he would get a better currency. He said that the plaintiff offered to purchase from him for cash, and was very anxious for him to take it; but he refused, for the reason before mentioned. Being asked, " Did you assign any reason to Mr. Kraker for declining to take cash, and if so, what reason?" his answer was: " I think I told Mr. Kraker--am pretty certain of it--it is a long time since--that I wouldn't sell for cash, because I thought that in a year or two the currency would be better. If he chose to take it at that risk he could do so. I wasn't anxious to sell the property." This testimony in behalf of the defendant also strongly sustains his answer; and the Circuit court, in that state of the case, would have been well warranted in rendering a decree against the plaintiff for the amount of the last note and interest, payable in the currency which existed at the time of its maturity. But, instead of that, the court referred the case to a commissioner; which could only have been done for the benefit, if not at the instance, of the plaintiff. Certainly, that decree was not to the prejudice of the plaintiff; though I do not mean to say that, under the circumstances of the case, it was not a proper decree.
The commissioner made a report sustaining the defendant's claim; to which report the plaintiff excepted, and the report and exceptions were recommitted to the commissioner with directions to report the reasons for his conclusions, and to take any additional evidence that might be offered by either party. The commissioner made another report under that order, giving his reasons, reä ffirming his former conclusions, and returning with his report two depositions taken before him in behalf of the plaintiff, to wit, the depositions of the plaintiff himself, Meyer Kraker, and of his brother Julius. These depositions do not materially vary the case. The plaintiff testified that there was no understanding about the kind of money in which the payments were to be made, except what was in the contract. And that when he was negotiating with Mr. Shields for the purchase of the property he did not offer to pay him in cash for it in Confederate money; though he admitted that Mr. McCormick advised him if possible, to buy the property for cash, and told him it would be a great thing for him to pay for it in cash. We have seen that both McCormick and Shields testified that the plaintiff did offer to pay cash for the property. But, however that may be, I think the decree which has been rendered against him is plainly right. The sale was made in November, 1862, at a time when Confederate money had already depreciated to two and a half for one, compared with gold, and was rapidly depreciating in value. The property was sold for $14,500, of which the sum of $4,500 was paid in cash in Confederate notes, and for the balance, $10,000, with interest from the date, negotiable notes were given, payable at one, two, three and four years after date. It was evident, from these long credits, that Shields expected that before they would all mature there would be a better currency, and intended that the notes should be payable in the money current at the time they respectively matured. And it is certain the plaintiff knew that such was the expectation and intention of Shields. For the plaintiff admits that McCormick advised him to buy the property, if possible, for cash, and told him it would be a great thing for him to pay for it in cash. How could it be so except that by paying cash for the property he would avoid the risk of loss from an improvement in the currency before the notes, or some of them, would mature? Probably no man in the South, in November, 1862, expected the war to last four years longer. Most persons expected it to end in a much shorter time, perhaps in one or two years, and all, no doubt, believed that however the war might terminate it would be followed by a better currency. The parties, in their contract, therefore, speculated upon the duration of the war and change of the currency. It turned out that the war lasted until April, 1865; longer, no doubt, than either party expected; and that Confederate money continued to be the currency of the country until the end of the war, although it rapidly depreciated in value all the time. Besides the cash payment of $4,500, which was made in Confederate money, the first two deferred instalments matured during the war, and were also paid in Confederate money, then, and especially when the second note became due on the 21st of November, 1864, reduced to a very low ebb. The last two notes, the third and fourth, matured after the war, in November, 1865 and 1866. The third was compromised and settled more than four months before it became due, by the payment of $2,000 dollars in greenbacks, though the nominal amount of the note was $2,950. The fourth now only remains due, and is the subject of controversy in this suit. I think the plaintiff is bound to pay the amount of it, with interest from the time of its maturity, in the money which was current at that time, according to the decree of the Circuit court. It was argued that if an improvement of currency was contemplated by the parties, it was of Confederate currency, and that it could not have been expected or intended that payment should be made in Federal currency. No doubt these parties believed, as did most people in the Confederate States, that the war would terminate favorably to them, and, therefore, that any improvement which might take place in the currency would probably be of Confederate currency. But they also knew that the war might terminate otherwise; and, however it might terminate, it must have been intended by the parties, as is certainly right and proper, that the vendor should be paid for his property by the vendee who enjoys it. The terms of the contract, the justice of the case and the presumed intention of the parties alike, apply to currency existing at the time of the maturity of the notes, whether it was Confederate or Federal. On this subject see what is said by this court in Boulware v. Newton, 18 Gratt. 708.
Upon the whole, I think there is no error in the decree of the Circuit court to the prejudice of the appellant. But I think there are two defects in the decree which ought to be corrected, and which may be corrected by an amendment. In the first place, the bill ought not to have been dismissed, and so much of the decree as dismisses it ought to be set aside. In the second place, the decree ought to be so amended as to reserve liberty to the defendant Shields, in case the decree rendered in his favor against the plaintiff personally should prove ineffectual in whole or in part, to apply to the court, by petition or motion in this cause, for further relief by a sale of the property for the satisfaction of the said decree, or so much thereof as may remain unpaid. I am therefore for affirming the decree, when so amended, with damages and costs.
The other judges concurred in the opinion of Moncure, P.
DECREE amended and affirmed.