Caswell Johnson vs. Ferdinand Von Scholley & others, trustees

Massachusetts Supreme Judicial Court1914-08-04

218 Mass. 454

Summary · law.co

Holding. The court sustained the plaintiff's exceptions and held that the trial court erred in excluding evidence of the plaintiff's written settlement instructions and pre-execution conversations, which were material to whether the defendants had been discharged under the accord and satisfaction they claimed.

The plaintiff settled a tort claim against a railway company but contended that he had not released the defendants, who were concurrent tortfeasors with the company. The defendants relied on a covenant not to sue as evidence of an accord and satisfaction that would discharge them. The trial court excluded certain evidence, including written instructions from the plaintiff to his counsel and conversations between the company's agent and the plaintiff's attorney, both of which bore on whether the settlement authorized by the plaintiff actually covered the defendants.

The court held that a covenant not to sue does not automatically discharge concurrent tortfeasors who were not parties to it. The defendants could have introduced paroi evidence to show what the actual compromise was, but the trial court improperly excluded evidence of the plaintiff's written authorization to settle and the subsequent negotiations. The plaintiff had authorized his counsel to settle only on the condition that his rights against the defendants be preserved. The jury should have been allowed to consider all admissible evidence to determine whether the covenant embodied the settlement the plaintiff actually authorized and whether, despite the covenant, the defendants had proven an unqualified compromise of the claim.

Summary generated by law.co from the public-domain opinion. The opinion text itself is public domain.

Key issues

Whether a covenant not to sue against a tortfeasor discharges concurrent tortfeasors who are not parties to it
What evidence is admissible to prove the actual terms of a settlement compromise
Whether attorney authority under general retainer extends to settling claims without qualification
Whether evidence of the plaintiff's conditional authorization to settle should have been admitted

Procedural posture

The plaintiff brought an action against the defendants; the trial court excluded certain evidence offered by the defendants regarding the settlement, and the plaintiff's exceptions to the judgment were heard on appeal.

Authorities cited

No cited authorities resolved to law.co cases yet.

Opinion · public domain

majority opinion

Braley, J.

The defendants and the railway company upon the record were concurrent tortfeasors, and an unqualified release of the company under seal would have discharged them. Feneff v. Boston & Maine Railroad, 196 Mass. 575. Boston Supply Co. v. Rubin, 214 Mass. 217. But the covenant not to sue put in evidence by the defendants did not operate as a discharge of the plaintiff’s cause of action; it only barred the remedy against the company for reasons stated in Matheson v. O’Kane, 211 Mass. 91.

The amended answer, however, pleaded in general terms an accord and satisfaction with the company whereby the defendants had been relieved from liability. It is settled that, not having been parties or privies to the instrument, the defendants could show by paroi evidence that the instrument did not express the actual compromise. Kellogg v. Tompson, 142 Mass. 76. See Snow v. Alley, 151 Mass. 14.

The correspondence between the various attorneys representing the plaintiff and the company, as well as his personal letter to it, were admissible as evidence of a demand for damages, and as preliminary to the final agreement in so far as the negotiations were authorized by him. Pickert v. Hair, 146 Mass. 1. Loomis v. New York, New Haven, & Hartford Railroad, 159 Mass. 39. James v. Boston Elevated Railway, 201 Mass. 263. It is to be noted that previous to September 21, 1912, the correspondence relates only to a claim against the company, or notice to it by the plaintiff of the discharge of former counsel and the retaining of new counsel. No offer to settle without suit appears.

The authority of an attorney under a general retainer to compromise a claim of his client’s, which is referred to in Brewer v. Casey, 196 Mass. 384, 388, where the earlier cases are cited, is not presented by the record. See also Gilman v. Cary, 198 Mass. 318.

The plaintiff’s instructions in writing to counsel then acting for him, offered in evidence by the defendants but improperly excluded, expressly authorized a settlement upon condition “that my rights be reserved against the Burkhardt Brewing Co.,” the name under which the defendants are described in the writ, although the legal form in which the settlement should be expressed is not stated. It was left to Ms counsel. The conversations between the agent of the company to whom the instructions had been transmitted and the plaintiff’s attorney, which took place before the covenant not to sue was executed, also were admissible if limited to the restrictions imposed by the instructions. New York, New Haven, & Hartford Railroad v. Martin, 158 Mass. 313, 316, 317. Riley v. Boston Elevated Railway, 195 Mass. 318, 322. Lewis v. Gamage, 1 Pick. 347. The jury should have been permitted to determine on all the evidence whether the covenant not to sue embodied the settlement the plaintiff had authorized, and which had been actually effected. If they found that it did, the defendants had not been discharged. But, if notwithstanding the covenant not to sue, the defendants on whom rested the burden of proof had shown that the plaintiff in fact had compromised Ms claim without qualification, the action could not be maintained. Boston Supply Co. v. Rubin, 214 Mass. 217.

Exceptions sustained,