THIS is an action of assumpsit, brought by Louis LeGuen against Gouver­neur & Kemble, for their negligence and misconduct as his factors or agents.—The cause was tried at the bar of the supreme court in the city of New-York, in October last, when a special verdict was found and damages assessed at dolls. 119,30266/100—In January term last the supreme court gave judgment for the plff. Louis LeGuen. To reverse which judgment the said G. & K. have brought a writ of error.

The declaration and plea may be seen at large in the printed copies of the re­cord which have been delivered—Of the facts found by the special verdict, the following are presumed to be those which are essential to the decision of the cause.

[Page 2] See printed special verdict page 11, 12. That L. LeGuen, being a native and cit­izen of France, was, on the 13th April, 1795, the proprietor of 687 bales of cotton and 24 casks and 38 cases of indigo, which had before that time been delivered to G. & K. as his factors, to sell for his best ad­vantage, on the usual commission.

That G. & K. by the intervention and express consent and direction of LeGuen, and as his factors, on the said 13th April, sold the said articles to Gomez, Lopez & Rive­ra, for £48, 966:6, on the terms specified in a contract executed by them and by the said G. & K. of which the following is the substance.

See the con­tract, page 12, 13. That the said Gomez & Co. had agreed to charter the ship-White-Fox, to proceed from the port of New-York to Havre-de-Grace and Hamburgh, for £2000 sterling, payable in London. They agreed to pur­chase from the said G. & K. (and to load in the said vessel) the said cotton at 3s. per lb. and the indigo at 16s. per lb. payable, in their joint notes of hand, twelve months after date, with ten months interest there­on [Page 3] at six per cent. subject to the following conditions:

1. That Gomez and Co. should have the property all covered by insurance; and that the policies for such insurance should be lodged with G. and K. as a collateral security for the payment of the notes.

2. That the first proceeds of the sales in France or elsewhere should be appli­ed to the payment of the notes, to a­bate the growing interest.

3. That the purchasers should return the necessary depositions and certificates of the goods being landed in a foreign country, to enable G. and K. to re­cover the drawback of the duties for their benefit. The purchasers relin­quish all interest in the said drawback, and engage that the cotton and indi­go should be on board on or before the 25th May then next.

4. That the said G. and K. might have it [Page 4] in their option to receive the whole or a part of the amount of the said notes at Havre-de-Grace, or at any port the said ship might discharge at in Europe; which the said Gomez and Co. engaged to pay in specie out of the proceeds of the sales of the cot­ton and indigo, together with a pre­mium of five per cent. for receiving it in Europe. G. and K. on their parts, were to make endorsements on the notes when advice of such pay­ments should be received. Penalty 20,000 dollars.

That the said cotton and indigo were thereupon delivered to the said Gomez and Co. who gave their joint promissory notes £48,966:6, being the amount for which the said cotton and indigo were sold, pay­able as specified in the said contract.

That the said articles were entered for exportation at the custom-house in the dis­trict of New-York, and that G. & K. there­upon received a custom-house debenture for £4,834:15, equal to 12,086 [...]/100 dolls. [Page 5] payable on the 15th August then follow­ing, and executed a bond to the United States in the penalty of dolls. 12,086.87 conditioned to land the said goods in some foreign port, and to produce the regular evidence thereof within twelve months.

That the purchasers executed with Ded­erick Kohne, sailing-master of the ship 15 White-Fox, a charter party for a voyage from New-York to Havre-de-Grace and Hamburgh; the cargo to be delivered to the purchasers or their assigns, "they pay­ing 16 freight for the same," £1400 sterling; 17 a proportion thereof at Havre-de-Grace, if any of the cargo should be there dis­charged, and the remainder in Hamburgh, 18 in good bills of exchange on London at sixty days.

At the foot of the charter party is a re­ceipt for £290 sterling, paid on account of 19 the charter money.

That G. & K. by two several bonds, in penalties amounting to 20,352 [...]/100 dolls. bearing date the 4th and 28th May, be­came bound for the performance of the [Page 6] covenants contained in the charter party on the part of Gomez & Co. But this does not appear to have been necessary for the in­terest of Mr. L.G. nor to have been done at his request.

Page 25. That G. & K. caused insurances upon the said Cotton and Indigo to be made in their own names, from the port of New-York to two ports in Europe, and paid the premiums thereon to wit 7,367 dollars.— But this does not appear to have been done by the said G. & K. for the interest, or at the request of the said LeGuen.

In the policies of the said insurances, was this note— ‘The vessel is neutral and the property warranted American— proof of interest to be made here only, and not to be bound by any foreign adjudication.’

Mr. LeGuen finding the said G. & K. evasive and disobliging in their conduct, and beginning to apprehend that they wished to embarrass him in the manage­ment of his property; in order to obtain an explicit avowal of their intentions Page 23. wrote to them on the 30th May, after re­ferring [Page 7] to the preceding disagreement with respect to the means to be taken to insure payment for the cotton and indigo—He directs them to insist, 1st, on that condi­tion of the sale which requires that the property should be completely covered by in­surance (the insurance being then deficient by 7,367 dollars) 2d, That they should give no order for the disposal of the pro­ceeds of the cargo without his knowledge and consent, that he might avail himself of the 4th article in the contract, to re­ceive the proceeds in Havre or Hamburg.

Afterwards, but on the same day, an interview was had between LeGuen and G. & K.—Mr. LeGuen repeated the in­junctions 24 contained in his letter, asked an abstract of their account that he might set­tle it to their entire satisfaction and discharge, and demanded a copy of the contract and an authorization to receive his money in Europe, represented to them that the car­go 24 was specially liable for the payments of the money due to him, and ought not there­fore to be burthened either with the freight money or premium of insurance; and page [Page 8] 59 of the printed special verdict, it ap­pears, that by the customs of Normandy, which province includes Havre de Grace, the vendor has a lien for the purchase mo­ney on goods sold until again sold and de­livered, and that LeGuen might have pre­vented a removal of the goods from thence, if there was danger of loss. The said G. and K. nevertheless disregarded all the re­quests and injunctions of Mr. LeGuen, and even in his presence encouraged the purcha­sers to depart with the ship White-Fox, and 24 to dispose of the cargo as they pleased—and that the said Gomez actually sailed with the said cargo in the ship White-Fox on the following day.

25 On the 6th June Mr. LeGuen having received no answer to his letter of the 30th May, no one of his requests or de­mands having been complied with, nor any account furnished to him; he writes again to G. and K repeating his former demands, urging the losses and inconveni­ences to which he was exposed by their 26 conduct; that they had even refused to name an agent in Europe to take care of his [Page 9] property, offers yet to co-operate with them, and proposes to join with them in taking legal advice as to the steps to be pursued.

To which G. and K. reply, by a letter of the same date, enclosing their account 27 whereby they claim a balance of £.6256 2 s 6 d, alledging that they are responsible for the charter money in £.3733:6:8 and refusing to give him any authorization until they should be paid this imaginary balance, and secured for this voluntary guarantee.

In the same letter they intimate, that 28 Mr. LeGuen's imagination is disturbed with idle anxieties, that he had no cause for alarm, for that Gomez, Lopez and Riv­era are men of good characters and suffi­cient responsibility, and that they (G. and K.) are disposed to treat the said Gomez and Co. with delicacy throughout.

From the 6th to the 15th, Mr. LeGuen reiterated his demands with different mo­difications —Messrs. G. and K. continue to refuse, [...] talk of their advances and res­ponsibilities, [Page 10] and, without making any fur­ther specific offers, insist that they have a right to direct all the monies to be returned from 35 Europe and to pass thro' their bands; and in their letter of 10th June set up for the first time, the penalty of 20,000 dollars con­tained in the contract as an additional reason why they refuse to give the authorization.

40 On the 15th June, Mr. LeGuen writes again to G. and K.—and after expressing his chagrin that they have never given him any specific reply nor made him a speci­fic proposition, he infers that they are de­termined at all events to retain his whole property until the winding up of the spec­culation of Gomez and Co. That they wantonly deprive him of the benefit of the election to receive his money in Europe and defeat all his projects—He protests a­gainst this conduct, and demands for the 40 last time that they forthwith furnish him with an authenticated copy of the contract of sale, and a competent authorization to re­ceive at the port of discharge whatever sum shall remain of the proceeds of the goods sold to Gomez and Co.—after first deducting and [Page 11] reserving such sum as they the said G. and K. 41 should think completely sufficient to cover them for all their advances, responsibilities, claims and demands of every kind.

G. and K. in their reply, insist on their right to retain in their hands the whole property, notes and contract until LeGuen shall give them satisfactory security in this country for all their claims and responsibili­ties, and they reject his offers. On the 42 16th Mr. LeGuen again remonstrates a­gainst the oppressive and insidious conduct of G. and K. in encouraging the buyers to depart—in withholding their accounts and the knowledge of their claims against him until the ship had sailed: By declaring that they took all upon themselves and refusing to allow him any intervention in the di­rection of his own property—He demands only a certified copy or the contract.

To this letter G. and K. give no answer!

That sundry other letters from the 1st October 1795, to the 28th March, passed between the parties, and are set forth in the special verdict page 43 to 59.

[Page 12] 53 On the 11th of December, G. and K. offer to execute to either of three houses named by LeGuen at Hamburgh, a pow­er to make him to obtain possession of the pro­ceeds See LG's let­ter of 19 Dec. page 54 and that of G. and K. of 23. page 56. of the cotton and indigo on the condi­tion of giving them security for their claims against all contingent demands, to which LeGuen by a letter of the 15th of that month acceded; but, G. and K. afterwards de­clined to give effect to this their own proposal.

In a letter of the 2d Jan. G. and K. in­form LeGuen, that they were about to send a power to Smith and Atkinson of London, as it was probable the property would be removed to London, instead of Lubert and Dumas of Hamburgh, and that they would pursue the necessary steps to touch as much of the money as could be done in Europe, not doubting of his approbation.

In answer, Mr. LeGuen declines to as­sume any special risk on the subject, ‘see­ing that the going with the cargo from Hamburgh to London, changes essential­ly 57 58 the nature and effect of the contract.’

[Page 13] The jury have also found, that on the 6 June, '95, the said LeGuen was indebted to G. and K. in £4795 6 3; that they had in their hands a custom house deben­ture, the property of the said Louis, pay­able in August following, for £.4834 15, which would leave a balance of £.39 8 10, due to the said L. LeGuen; but the jury 32 farther say that G. and K. were entitled to a commission of £60 8 10, on this de­benture, which would leave due to G. and K. twenty-one pounds and three pence, on the general balance of their account—That G. and K. received the amount of the debenture when it became due, and that the bonds which they entered into at the custom-house were cancelled on the 1 April '96.

That G. and K. did not, at any time previous to the 1 Dec. '95, elect to receive the proceeds of the cotton and indigo in Europe—but did on the 22 Dec. elect to receive them in Hamburgh, and on the 2 Jan. '96, elect to receive them in London.

[Page 14] That the result of a careful examination of the facts found by the verdict is, that the advances and responsibilities of G. and K. for Mr. LeGuen, which they make the pre­text for detaining from him so large a pro­perty, are reducible, the advances to the above trifling sum of twenty-one pounds and three pence, and the responsibilities to the bond given to the custom-house for twelve thousand and eighty-six dollars and eighty-seven cents, which was sure to be cancelled upon producing evidence of the landing of the goods abroad. Nevertheless, Gouver­neur & Kemble had then actually received commissions to the amount of three thou­sand seven hundred and eighty-two dollars and five cents.

That it does not appear from any thing contained in the special verdict, nor is it to be inferred from any thing even offered to be proven, that G. and K. will be losers; but considering the monstrous benefit arising from the use of so large a sum of money—considering that they have at length suc­ceeded in placing the property in the hands of their friends, Smith and Atkinson, of [Page 15] London—considering that, in the last re­sort, Gomez & Co. are, as alledged by G. and K. men of property and responsibility—considering also, that a recovery in this action by LeGuen, will vest the notes and property in Gouverneur and Kemble; it is fairly to be presumed, that they have seen and known how to secure not only an in­demnification, but profit by their misconduct.

LeGuen nevertheless very naturally de­termined to look to the responsibility of Gouverneur and Kemble, rather than to the proceeds of the goods, however sufficient they might be, because he knew the assertion of his right to them, would subject them to sequestration by the British government, in consequence of his character of Alien—Enemy.

[Page] [Page 16] THE COUNSEL for Louis LeGuen will urge and maintain,

1. That every contract made by a factor for the sale of goods is for the benefit of his principal, and forms a contract between the principal and the purchaser, and that eve­ry contract made by a factor for his own benefit with the property of the princi­pal, is a violation of his duty and a fraud against the principal.

2. That every factor is bound generally to obey the orders of his principal, and par­ticularly to use his endeavors to carry into effect any contract by him made for the be­nefit of his principal.

3. That therefore, if a contract should stipulate an advantage to depend on an election to be made, that election being itself a priviledge or benefit, is to be exer­cised for the principal and is subject to his controul and direction.

4. That in the present case, the right of election to receive the purchase money [Page 17] in Europe, was a right which G. and K. ought to have exercised for the benefit of their principal, according to his direction and request, especially as he was thereby to receive a premium or advance of price of five per cent, equal to 612031/100 dollars.

5. That this position and inference are the more obvious in the present case, Be­cause, the factors could neither have stipu­lated nor exercised such a right without the consent of their principal—Because, the contract was made by the intervention and express direction of LeGuen—Because, it was his avowed object to transfer his pro­perty to France, of which country he was a native and citizen—because at Havre deGrace, to which port the ship was bound, he would have had a lien on the property which would have enabled him to have taken precautions important to his securi­ty; and because it is absurd to suppose that all these advantages could be defeated at the mere pleasure of the factors and in de­fiance of the direction of the principal.

[Page 18] 6. That the acknowledged lien which a factor has on the property entrusted to him for his advances and responsibilities can form no objection to the demand of LeGuen in the present case, because,

That lien like every other right is liable to be modified or abolished by the a­greement of the parties either express or implied—

That it is not in its nature local, but de­pends wholly on the place of payment;

That G. and K. by becoming parties to a contract for the benefit of LeGuen, co [...]aining a right of election to re­ceive in foreign parts the monies to arise from the proceeds, virtually a­greed to give effect to this right and to exercise his lien at the place of pay­ment—

That if payment had been positively stipulated at Havre or Hamburgh, no doubt could have arisen but that, af­ter reserving enough to cover their [Page 19] advances and responsibilities, they would have been obliged to pay the overplus there to LeGuen; and in such case, to have contended that they would have had a right to bring back the whole amount of the sales to New-York at his expense and risk, to cov­er themselves for a sum which might not amount to one thousandth part of it, would be an absurdity too glaring to be endured—that a right of election to receive in a foreign port, brings the matter to the same issue—when that election was made, the foreign port became the place of payment, and there only could the lien of the factors be exercised.

That it is an invariable maxim in law, that he who agrees to an end agrees to the MEANS. G. and K. might have refused to enter into the contract on such terms, but having assented, hav­ing executed the contract, they were bound not to impede the perform­ance of it.

[Page 20] That G. and K. could have given the authority required of them by LeGuen, in so special a form and with such co-opera­tion of an agent named by themselves, as would have secured to them the full bene­fit of their lieu.

And lastly it will be demonstrated that upon the construction contended for by G. and K. they and their agents may keep the whole property in their hands forever.

With respect to the measure and amount of damages, for the respondent, it will be contended,

1. That the rules of law prescribe the measure of damages in all cases in which they are not merely contingent—Thus in promissory notes and other liquidated de­mands, the legal interest—on foreign bills 20 per cent—on inland bills 5 per cent; without any enquiry into the special dam­age which the party may have actually sustained. Thus in actions of trover, how­ever [Page 21] slight the damage, the party is com­pelled to pay the whole value of the sub­ject of which he hath made an improper use—Thus finally, in every case of a factor or trustee, the damages are invariably the whole value of the property which may have been affected by his neglect or mis­conduct; as in a case of acknowledged au­thority, if a factor be instructed to sell at a credit of 30 days and he sell at a credit of 31, he is instantly liable for the value of the whole, although the purchaser prove insolvent within the thirty days; because a violation of his duty relating to the whole—If he had sold a part only, he would in like manner have been liable for that part. So if a trustee be directed to put out mon­ey on real property and lend it on person­al security, however competent, he is in­stantly answerable personally for the whole. No enquiry is made or would be allowed as to the actual or probable damage sus­tained: the factor and the trustee are deemed to have taken the responsibility upon themselves.

[Page 22] 2. That the application of this obvious principle is peculiarly necessary in the present case, because of the impossibility of ascertaining or calculating the events which may have affected the views and interest of the parties—that if LeGuen should prove on the one part that he could have made half a million of dollars by the receipt of his money in Havre; and by his presence in aiding the sales, could have also ensured a profit to Gomez and Co.—and G. and K. on the other part should prove that they had reason to believe that a better market could be had at Ham­burgh; a court ought to pronounce, as has been done by the supreme court, that all such proof would be irrelevant and could tend only to introduce confusion and uncertainty; the only object of enquiry being, have G. and K. neglected or diso­beyed the orders of their principal—if so, does their neglect or misconduct relate to the whole or a part only of the property; [Page 23] if to the whole they are liable for the whole, if to a part for that part only. [...] [...]ther evidence was admissible to ex [...]guish or mitigate the damages, but that the price in the sale was fraudulent—that the pro­perty had been lost before the default— that the principal had released the whole or part, or had been wholly or partially compensated— neither of which points was in any sort attempted to be proved.

3. That a default which gives a right of action, necessarily carries with it the rule of compensation or damages, as an inci­dent, and which cannot therefore in any degree depend on future events and con­tingencies.

4. That as the default in the present instance related to the whole property, and defeated the essential part of the sale, G. and K. thereby substituted themselves to the purchasers, and took upon them­selves the risk of future contingencies: That the amount for which the property sold is the proper and only standard of va­lue [Page 24] [...] of damages, and that on any other prin [...] there could be no rule of damage in [...] [...]resent case; the events which took place subsequently to the default offering only a field for vague and unlimited con­jecture.

5. That in the cases mentioned under the first head, and in many others, the law fixes the rule of damages, which will regu­late and controul the verdict of a jury—That when the parties agree the value, this value is the rule—That where an a­gent, by his assumption or default, puts himself in the place of another with whom he has settled the value, the value so set­tled shall govern as against him.

6. That consequently the amount for which the goods were sold to Gomez, Lo­pez and Rivera, together with five per cent for receiving in Europe, is the principal sum for which G. and K. became liable for their default.

The foregoing general propositions will be illustrated by arguments and analo­gies, which it is hoped will fully e­vince [Page 25] their soundness, and th [...] [...]pri­ety of the judgment of the [...]eme court.

The objections in point of form, with which G. and K. may attempt to em­barrass the cause, would not be worthy of notice in this state of the business, even if they could be anticipated. They will, with­out difficulty, be disposed of in the course of the argument.

Equal to 153,010 dollars 18 cents, ‘Calculated agreeably to the opinion and directions of the Supreme Court.’

[Page 5] payable on the 15th August then follow­ing, and executed a bond to the United States in the penalty of dolls. 12,086. 87 conditioned to land the said goods in some foreign port, and to produce the regular evidence thereof within twelve months.

That the purchasers executed with Ded­erick Kohne, sailing-master of the ship 15 White-Fox, a charter party for a voyage from New-York to Havre-de-Grace and Hamburgh; the cargo to be delivered to the purchasers or their assigns, "they pay­ing 16 freight for the same," £1400 sterling; 17 a proportion thereof at Havre-de-Grace, if any of the cargo should be there dis­charged, 18 and the remainder in Hamburgh, in good bills of exchange on London at sixty days.

At the foot of the charter party is a re­ceipt for £290 sterling, paid on account of 19 the charter party.

That G. & K. by two several bonds, bearing date the 4th and 28th May, be­came bound for the performance of the [...] [Page 6] [...] [Page 7] [...] [Page 8] [...] [Page 9] [...] [Page 10] [...] [Page 11] [...] [Page 12] [...] [Page 13] [...] [Page 14] [...] [Page 15] [...] [Page 16] [Page 17] in Europe, was a right which G. and K. ought to have exercised for the benefit of their principal, according to his direction and request, especially as he was thereby to receive a premium or advance of price of five per cent.

5. That this position and inference are the more obvious in the present case, Be­cause, the factors could neither have stipu­lated nor exercised such a right without the consent of their principal—Because, the contract was made by the intervention and express direction of LeGuen—Because, it was his avowed object to transfer his pro­perty to France, of which country he was a native and citizen—because at Havre deGrace, to which port the ship was bound, he would have had a lien on the property which would have enabled him to have taken precautions important to his securi­ty; and because it is absurd to suppose that all these advantages could be defeated at the mere pleasure of the factors and in de­fiance of the direction of the principal.

[Page 20] That G. and K. could have given the authority required of them by LeGuen, in so special a form and with such co-opera­tion of an agent named by themselves, as would have secured to them the full bene­fit of their lien.

With respect to the measure and amount of damages, for the respondent, it will be contended,

1. That the rules of law prescribe the measure of damages in all cases in which they are not merely contingent—Thus in promissory notes and other liquidated de­mands, the legal interest—on foreign bills 20 per cent—on inland bills 5 per cent; without any enquiry into the special dam­age which the party may have actually sustained. Thus in actions of trover, how­ever slight the damage, the party is com­pelled to pay the whole value of the sub­ject of which he hath made an improper use—Thus finally, in every case of a factor or trustee, the damages are invariably the [Page 21] whole value of the property which may have been affected by his neglect or mis­conduct; as in a case of acknowledged au­thority, if a factor be instructed to sell at a credit of 30 days and he sell at a credit of 31, he is instantly liable for the value of the whole, although the purchaser prove insolvent within the thirty days; because a violation of his duty relating to the whole—If he had sold a part only, he would in like manner have been liable for that part. So if a trustee be directed to put out mon­ey on real property and lend it on person­al security, however competent, he is in­stantly answerable personally for the whole. No enquiry is made or would be allowed as to the actual or probable damage sus­tained: the factor and the trustee are deemed to have taken the responsibility upon themselves.

2. That the application of this obvious principle is peculiarly necessary in the present case, because of the impossibility of ascertaining or calculating the events [Page 22] which may have affected the views and interest of the parties—that if LeGuen should prove on the one part that he could have made half a million of dollars by the receipt of his money in Havre; and by his presence in aiding the sales, could have also ensured a profit to Gomez and Co.— and G. and K. on the other part should prove that they had reason to believe that a better market could be had at Ham­burgh; a court ought to pronounce, as has been done by the supreme court, that all such proof would be irrelevant and could tend only to introduce confusion and uncertainty; the only object of enquiry being, have G. and K. neglected or diso­beyed the orders of their principal—if so, does their neglect or misconduct relate to the whole or a part only of the property; if to the whole they are liable for the whole, if to a part for that part only. No other evidence was admissible to extinguishing or mitigate the damages, but that the price in the sale was fraudulent—that the pro­perty [Page 23] had been lost before the default—that the principal had released the whole or part, or had been wholly or partially compensated— neither of which points was in any sort attempted to be proved.

3. That a default which gives a right of action, necessarily carries with it the rule of compensation or damages, as an inci­dent, and which cannot therefore in any degree depend on future events and con­tingencies.

4. That as the default in the present instance related to the whole property, and defeated the essential part of the sale, G. and K. thereby substituted themselves to the purchasers, and took upon them­selves the risk of future contingencies: That the amount for which the property sold is the proper and only standard of va­lue and of damages, and that on any other principle there could be no rule of damage in the present case; the events which took place subsequently to the default offering [Page 24] only a field for vague and unlimited con­jecture.

5. That in the cases mentioned under the first head, and in many others, the law fixes the rule of damages, which will regu­late and controul the verdict of a jury—That when, the parties agree the value, this value is the rule—That where an a­gent, by his assumption or default, puts himself in the place of another with whom he has settled the value, the value so set­tled shall govern as against him.

6. That consequently the amount for which the goods were sold to Gomez, Lo­pez and Rivera, together with five per cent for receiving in Europe, is the principal sum for which G. and K. became liable for their default.

The foregoing general propositions will be illustrated by arguments and analo­gies, which it is hoped will fully e­vince their soundness, and the propri­ety of the judgment of the supreme court.

[Page 25] The little objections in point of form, with which G. and K. may attempt to em­barrass the cause, would not be worthy of notice in this state of the business, even if they could be anticipated. They will, with­out difficulty, be disposed of in the course of the argument.