
    Oregon Imp. Co. v. Roach et al.
    
    
      (Superior Court of New York City, General Term.
    
    June 28, 1889.)
    1. Estoppel—In Pais—Assignment op Contract.
    Defendants’ testator contracted to build a ship for a navigation company, which before receiving the ship assigned its rights to plaintiff. There being some difficulty in adjusting the rights between plaintiff and the navigation company, it was arranged, with the knowledge of all, that plaintiff should pay the balance of the price of the ship to testator, and the latter should deliver to a third person two bills of sale, one running to plaintiff and one to the navigation company, and should receive a receipt conditioned that one of the bills should be delivered to the one entitled to the ship, and the other be returned to plaintiff. It was also conditioned that a bill of sale would not be delivered to plaintiff unless the navigation company acquitted testator “for the full performance by them of the contract * * * for the building of said ship. ” Held, that plaintiff, having accepted a bill of sale, was estopped to deny that testator had complied with the requirements of the contract of building.
    2. Contracts—Construction—Receipt.
    The receipt.was of the nature of a contract, and cannot be construed to refer, in the provision as to performance of the contract, to delivery of the ship merely, and not to details of construction.
    3. Sale—Warranty—Right oe Action.
    A false statement by testator’s agent, that the vessel conformed to the requirements in certain respects, does not create as to plaintiffs, who were mere assignees, an actionable warranty surviving the delivery of the vessel, though it might give a right of action for false representations.
    Argued before Truax and Dugro, JJ.
    
      Holmes & Adams, for appellant. B&ward Gebhard and Dewitt C. Brown, for defendants.
   Dugro, J.

This is an appeal from a judgment dismissing the complaint in this action on the merits. I will speak of the plaintiff as the “Improvement Company,” and of the Oregon Railway & Navigation Company as the “Navigation Company. ” The complaint alleging a contract between plaintiff and defendants’ testator, John B. Roach, who was doing business under the name of “John B. Roach & Son, ” seeks in part a recovery thereon for breach of warranty. The answer contains a denial that John B. Boach ever entered into any contract with the plaintiff, as set forth in the complaint. As there was no evidence in support of the plaintiff’s contention on this issue, there was, as to this branch of the case, no error in dismissing the complaint. The complaint further alleges substantially that Roach failed to perform on his part a certain contract, in writing, for the building of a ship, duly made and executed by and between him and the Navigation Company; that on February 21, 1884, the plaintiff duly performed the Navigation Company’s part of the contract; that the Navigation Company, on said day, assigned to the plaintiff all rights and interests acquired or possessed by it by reason of this contract; and that the alleged nonperformance on the part of Boach damaged the plaintiff $100,000. I will assume these allegations to constitute the cause of action relied upon by the plaintiff. The defendant admits the contract with the Navigation Company, and, among other things, alleges that it has been duly performed. It seems that about February, 1888, a contract in writing was made between John B. Boach and the Navigation Company for the building of a ship in consideration of $465,000. About February 21,1884, the ship was tendered by Mr. Weed, the representative of Boach, in performance of the contract, and $65,000, the balance unpaid on the contract, was demanded. The facts which occurred at the time of the tender of the vessel, when the representatives of Boach and both companies were present, seem vital to the case. It appears that at this time $65,000 was due as a balance on the purchase money of the ship, (the Navigation Company having paid $400,000 on account;) that there were accounts to be settled, and difficulties between the two companies'in regard to the ship; that the Improvement Company wanted the vessel, and was ready to pay the $65,000 balance; and that the Navigation Company, in the language of Mr. Holmes, “would not surrender their rights to the ship unless they were paid by the Improvement Company for the advances which the Navigation Company had made to Boach on account of the former payments, and the Improvement Company was not able to pay at that time, until they finally accommodated their differences,—the amounts which the Improvement Company so owed the Navigation Company. But as to these mutual accounts there was no question between Boach and the Improvement Compan)r. The delay was caused solely by the difficulties between the two companies, Mr. Boach being ready and waiting to receive his money. For the reason, so far as Boach was concerned, there were two bills of sale given, and the escrow made.” As it was undetermined to whom the bill of'sale should be delivered by Boach, in order to arrange the matter it seems that it was agreed that Boach should accept the $65,000 from the Improvement Company, and that he should deliver to Mr. Holmes two bills of sale, (duplicates,) with the exception that one ran to the Navigation Company as vendee, and the other to the Improvement Company as vendee, and that upon such delivery Mr. Holmes should give to Boach a receipt, “the substance of which had been agreed upon,” and which was as follows: “The final payments, in full, for the S. S. Santa Bosa having been paid to John Boach, I acknowledge to have received this day from said John Boach two separate bills of sale of said steam-ship,—one to the Oregon Improvement Company, and the other to the Oregon Bailway & Navigation Company, —in escrow, to be delivered to whichever company shall be entitled to receive the same, and the other, upon the cancellation thereof, to be redelivered to said John Boach; the bill of sale to said Improvement Company not to be delivered except upon the acquittal of John Boach & Son by the Oregon Bail-way & Navigation Company for full performance by them of the contract with the last-named company for the building of said ship. [Signed] Artemtjs H. Holmes.” Prior to the delivery of the papers, and the payment of the $65,000, the plaintiff’s representatives stated in the presence of Boach’s representative, Weed, that they could not pronounce upon the vessel as to its drought and speed conforming with the contract. Mr. Weed then said that, “as to particulars of speed and drought, she did conform to the contract;” and thereupon the bills of sale were delivered to Mr. Holmes, and the receipt, and a check for the $65,000, were passed to Mr. Weed. Some few months later, the two.companies having arranged their difficulties, Mr. Holmes delivered the bill of sale to the Improvement Company, and returned to Boach the other bill of sale. The receipt above referred to seems to me to be in the nature of a contract. From its terms it seems that the bill of sale to the Improvement Company was not to be delivered except upon the acquittal of Boach by the Navigation Company for the full performance of the contract for the building of the ship. These terms were known to the plaintiff; and having, under the circumstances, accepted the bill of sale from Mr. Holmes, it is estopped by its conduct from claiming in tiiis action that Boach has not fully performed his contract with the navigation Company. If that contract be fully performed, no claim against the defendant could pass by the alleged assignment by the navigation Company to the Improvement Company. It is claimed that the intention of the parties in making the provision as to the acquittal in the receipt was that Boach should only be acquitted by the navigation Company of his duty to deliver the vessel to it, and that the acquittal was an acquittal as to delivery only. This may have been the intention, but the words of the receipt do not so express it, and these words must prevail as showing the intention of the parties. The plaintiff contends that Weed’s statement as to the vessel’s drought induced the acceptance; that, as the statement was false, a warranty survived the deli very of the Vessel; and that the present action is brought upon this warranty. I agree with the plaintiff that a false representation at delivery, under an ex-ecutory contract of sale, may cause a warranty to survive an acceptance; but it must be remembered that it was not shown that there was a sale of the vessel by Boach to the plaintiff. The sale of the vessel was to the navigation Company. Whatever rights the Improvement Company had in the vessel were, under the evidence in the case, obtained by assignment from the navigation Company. Weed’s representation that the vessel conformed with the contract as to drought may have been such a false representation as would render Boach liable, in an action for damages, for false representation; but this action is not for the tort. At the trial the defendant moved for a nonsuit, and his motion was granted. The complaint was not dismissed on the merits. The judgment should therefore be modified by striking out the words “on the merits” where they appear therein, and as so ihodified should be affirmed, with costs.  