
    Thomas M. Brewer vs. Roland Worthington & others.
    If upon the dissolution of a firm the partners who remain assume the payment of the part nership debts and agree to save the retiring partner harmless therefrom, and a judgment is subsequently recovered against all of them upon one of the partnership debts, and the retiring partner pays a portion of the amount to the judgment creditors, taking from them an agreement in which they, in consideration of the payment to them, covenant not to molest him or take his property thereon, reserving all their rights against all the other judgment debtors, he may recover the amount so paid by him in an action against his former partners.
    Contract upon a written agreement by the defendants, reciting that the plaintiff retired from the firm of Worthington, Flanders & Guild, of which be and the defendants had been members, conveying to them all his interest in all the property of the partnership, and providing that they should assume and pay all the debts and liabilities-, and save the plaintiff harmless therefrom.
    At the trial in the superior court, before Morton, J., it appeared that two judgments upon two notes amounting together to about §9000, were subsequently recovered by the Telegraph Newspaper Company against the plaintiff and the defendants upon debts of the firm, and afterwards the plaintiff paid to the judgment creditors the sum of §1000, partly in cash and partly in a note of a third person, taking from them an agreement reciting that, in consideration of the said payment to them by the plaintiff, they covenanted and agreed never to “ molest or arrest the said Thomas M. Brewer, or his legal representatives, or attach or seize or levy upon his or their property upon or on account of either of the judgments,” 11 hereby reserving all our lights against all the other judgment debtors.” Due demand was made by the plaintiff upon the defendants.
    Upon these facts the judge directed a verdict for the plaintiff, for the §1000 and interest, which was rendered accordingly; and the defendants alleged exceptions.
    
      G. O. Shattuck, for fne defendants.
    
      B F. Brooks, for the plaintiff.
   Dewey, J.

This contract is something more than a mere contract of indemnity. It is also an agreement to assume and pay all the debts and liabilities of the late firm of Worthington, Flanders & Guild. Two notes given to the Telegraph Newspaper Company afterwards fell due which the defendants neglected to pay, and permitted suits to be instituted thereon, and judgment to be rendered against the plaintiff and themselves. In this state of the case, the plaintiff, being subject to a levy of the execution upon this judgment, made the arrangement with the creditors in the manner stated in the bill of exceptions.

There was clearly-a breach of the covenant of the defendants for which the plaintiff may maintain his action, and the only inquiry is as to the measure of damages. If treated as a mere bond of indemnity, the plaintiff could only recover nominal damages, if he had made no payment thereon and had suffered no particular damage.

In the case of a covenant to pay the sole debt of the obligee to a third person, we see no objection to the obligee’s recovering the whole amount of the debt which the defendant had stipulated to pay, in case of a breach of the covenant, as such recovery fully discharges the obligor from all further liability. But where the covenant is to pay a debt due to a third person as well from the obligor as the obligee, a difficulty arises, inasmuch as the defendant may be further charged with the debt by those to whom it is payable.

It may be thought that the case of Loosemore v. Radford, 9 M. & W. 657, is somewhat more favorable to the plaintiff, and would authorize a recovery for the whole amount without any previous payment thereof by him. It was a covenant to indemnify against a note where both parties to the covenant were promisors in the note, the plaintiff in fact being a surety for the other party, and the defendant covenanted with the plaintiff to pay the note to the payee on a future day named, but neglected so to do; and it was held that the plaintiff was entitled to recover as damages the full amount of the note, although he had not paid the same. It was said on that case by Parke, B« 11 that the defendant may perhaps have an equity that the monel he may pay to the plaintiff shall be applied in discharge of his debts, but at law the plaintiff is entitled to be placed in the same situation under this agreement as if he had paid the money to the payee of the bill.”

But it seems to be unnecessary to express an opinion upon the question presented in a case where there has been no payment. Here the plaintiff makes no claim beyond the one thousand dollars paid by him, and the precise inquiry is whether that sum was paid under such circumstances as to create a valid claim for damages to that extent. That the plaintiff had the' right to pay the judgment, and resort to the defendants for remuneration, cannot be doubted; but the theory of the defendants is, that this sum of one thousand dollars was not paid upon the judgment, or in discharge of any portion thereof, and that they remain liable to the judgment creditors for the full amount of the same, and thus will be liable to be twice charged, if the plaintiff is allowed to recover damages for the payment made by turn. But we do not consider the plaintiff’s claim obnoxious to that objection. We must suppose that the payment was made upon the judgment, and that the purpose of the parties was to fix a certain amount which, if paid, should operate to bind the creditors not to levy their executions upon the body or property of the plaintiff. But it is not to be inferred that it was the purpose of this arrangement that the judgment creditors were in any event to receive more than the whole amount of the judgments. The practical effect of the arrangement was that the creditors received one thousand dollars upon the judgment from the plaintiff, and thereupon obligated themselves to collect the residue wholly from his co-debtors. The facts, therefore, show not only a breach of the covenant of the defendants to pay this debt, but also a case of actual damage to the amount of the sum paid by the plaintiff, for which he is entitled to recover.

Exceptions overruled.  