A Ten Eyck and C. Elmendorf against G and B. Tibbits

*A Ten Eyck and C. Elmendorf against G and B. Tibbits. On au assignment of a bond payable by instalments, with a covenant from the assignor, that “ if the obligor should become insolvent, or not be able to pay, Ac., and if the assignee, &c., should use all due diligence and take , all legal measures, &c., immediately after the several sums of money shall respectively become due,” the assignor is liable for the whole amount, on the insolvency of the obligor, on the first instalment becoming due, and the assignee is not obliged to wait till the last is payable. If the first instalment be not demanded, it will, unless the contrary be shown by the defendant, be presumed to have been paid. An assignment of property under the absconding debtors’ act, is evidence o( insolvency in the debtor; and the assignee of his bond is not precluded from his action against the assignor, because he lias' not proved the amount under the debtor’s estate. This was an action of covenant, and came before the .court on demurrer. • The declaration stated a bond, from one Jonathan Bennington to the defendants, in the penal sum of eight thousand dollars, conditioned for the payment, of four thousand dollars, by instalments of one thousand dollars each, with interest, on the first days of May, 1798, 1799, 1800, and 1801; an assignment of this bond for “ value received,” by an endorsement under the hands and seals .of the defendants, covenanting with the plaintiffs, “That in case the said Jonathan, the obligor in the said bond, should become insolvent, or not be able to pay and satisfy the said bond, and if the said Abraham and Oonradt, their heirs, executors and administrators should use all due diligence, and take all legal measures by prosecution at law to recover the same, and that immediately after the said several sums of money should respectively become due, and should not be able by such means to compel the payment thereof, then and in that case, the said George and Bénjamin did covenant to pay to the said Abraham and Oonradt, the amount of the said bond, with interest, or such part thereof as should then remain due from the said Jonathan Bennington.” The plaintiffs then averred the second instalment of 1,000 dollars, due on the first of May, 1799, to have become payable, before which ■ time, to wit, on the 25th of December, 1798, the said Jonathan Bennington absconded, and still continued absent, from the state of New York; and that afterwards, to wit, on the 28th of February, 1799,i they sued out an attachment against him, under the "Act for relief against absconding and absent debtors ;” under - which his estate and effects were seized - and sold, but did not produce more than 10s. in the pound, so, “on the said 1st day of May, 1799, and long before, the said Jonathan was insolvent, and not able to pay and satisfy the said bond.” That they, after-wards, on the 1st of May, *1799, caused a writ of [*428] copias ad respondendum to be issued against him, which was returned not found ; whereon they, on the 10th of August, 1799, caused an alias copias ad respondendum to be sued out, which was also returned not found, and that they had not been able, by the means aforesaid, to compel payment of the several sums of 1,000 dollars, due on the 1st of May, 1799, nor of the sum of 1,000 dollars due on the 1st of May 1800; by reason whereof the defendants became liable to pay the same. Nevertheless they had not paid the same, &c. and só the said Abraham 'and Oonradt say, th‘e said George and Benjamin have not kept their covenant so made as aforesaid, &c. The defendants (after demanding oyer of the bond, condition, assignment, and covenant) pleaded in bar, 1st. That the plaintiffs “ did not use all due diligence, and take all legal measures by prosecution at law, to recover the said bond immediately after the said several sums mentioned in the condition thereof, respectively became due,” and this they are ready, &c. wherefore they pray, &e. 2d. By protestation denying that Bennington was, at the several times above mentioned, insolvent, or was, and yet is, unable to pay and satisfy the said bond; they further pleaded, that when the first instalment of 1,000 dollars, with interest, became due, on the 1st of May, 1798, Bennington did not, nor hath since paid the same; so that the bond then became forfeited, immediately after which the plaintiffs did not, nor until long afterwards, to wit, on the 1st of May, 1799, take any legal measures on the bond against the obligor; and this, &c. Wherefore, &c. 3d. That they did not prosecute in like manner for the instalment due in May, 1800. 4th. As to the instalment due in May, 1799, that Bennington at the time of executing the bond in question, transferred also, as a further security, a mortgage on lands in Bensselaer county, which they had assigned, together with the bond, to the plaintiffs, who, on the 1st of November, 1799, sold the premises for 1,510 dollars, and thus paid themselves the instalment of May, 1799. p"429] *5th. As to the instalments due in May, 1799, and May, 1800, that Bennington, after the 1st of May, 1799, and before the 1st of May, 1800, to wit, on the 1st of November, 1799, paid and satisfied to the plaintiffs the several sums of 1,000 dollars due by the condition aforesaid. To the 1st plea the plaintiffs replied, payment of the 1,000 dollar instalment, due in 1798, on the 1st of May, according to the condition; and as to the sum of 1,000 dollars due on the 1st of May, 1800, Bennington’s absconding on the 25th of December, 1798, and due diligence as to the instalment of 1799. To the 2d, payment by Eennington, of the 1,000 dollars due in 1798. To the 3d, that before the sum therein mentioned became due, to wit, on the 25th of December, 1799, Eennington absconded. To the 4th, that they had not been paid the 1,000 dollars, due in May, 1799, by the sale of the mortgaged premises, as the defendants in their 4th plea had alleged. To the 5th, that Eennington had not paid the instalments of 1799, and of 1800. To the 1st replication, the defendants demurred generally. To the 2d rejoinder, that Eennington did not pay as the plaintiffs had replied, and issue thereon. To the 3d, a general demurrer. To the 4th, rejoinder, that the plaintiffs were paid, and issue thereon. The demurrers were now aigued by Harison and JEhnolL, for the defendants, and Van Vechten and Woodvjorih, for' the plaintiffs. For the defendants. This is an action of covenant, and is brought before the court on two demurrers by the defendants to the first and third replications of the plaintiffs. The pleadings are by no means intricate, and though it might be sufficient to confine ourselves to the demurrers only, yet it is conceived the declaration itself is defective, and therefore, the plaintiffs can never recover. The declaration states a *bond from Eennington to the Tib- [*430] bits, conditioned for payment of 4,000 dollars, with interest, by instalments of 1,000 dollars each; that the whole of this being unpaid, on the 19th of January, 1797, the defendants assigned the bond to the plaintiffs, and, at the same time, entered into a covenant to pay it themselves, in case Eennington should become insolvent, or unable to pay it, provided the plaintiffs should use due diligence by course of law, and all legal measures “ to re.cover the same immediately after the several sums of money should respectively become duel' It then further states a payment of 1,000 dollars, due on the 1st of May, 1799, before which time, on the 25th of December, 1798, Bennington absconded; that on the 28 th of February, 1799, an attachment issued against his estate and effects under the absconding debtors’ act, by virtue of which his property was sold, and produced not enough to pay 10s. in the pound; and •so the plaintiffs state, on the 1st of May, 1799, and long before, he became insolvent, and unable to pay his bond, Then a copias, and an alias copias ad respondendum is sta ,-ted, with non est inventus returned to each; whereby the plaintiffs were unable to compel payment of the instalments according to the terms of the condition. Our first objection is, that the action will not lie till the whole money is due, not till after the first of May, 1801; whereas the present suit was commenced in 1800. This appears from the covenant. The words are, “ not able to pay and satisfy the said bond.” A person may be unable in 1800, yet fully competent in 1801. A single default is not sufficient; and even if the suit might have been instituted when began, the averment, in that case, does not go •far enough: it ought, on the principle just mentioned, to have stated the insolvency, &o. to have continued till the. commencement of the action ; for, after May, 1799, and before suit brought, Bennington might have been adequate to every demand. The “ and so,” therefore, of the declaration, that Bennington was insolvent, is not warranted by the circumstances preceding, and the averment inconclusive ; nor does a person’s being absent, and his goods sold under the attachment set forth, prove insolvency [*431] or inability. A toan, though *out of the jurisdiction of this court, may be able to pay his debts here, though 'his property should be abroad. This, therefore, is equally an insufficient allegation. The averment ought to have been direct and independent, not drawn by way of agreement; for then it might have gone to a, jury, and they might have .presumed him insolvent. But, allowing this to be against usj it does not appeal that due diligence has been used. The covenant is, to use due diligence by prosecuting at law. This has not been done. There is a difference between using due diligence and prosecuting at law. The plaintiffs ought to have done both, and not one only. To show the diversity; suppose Bennington had had the.mo•ney .in his hands, and had said to -the plaintiffs that he would pay it if they would call; instead of which, they do .not call, but proceed, and Bennington afterwards becomes a bankrupt. This would be taking legal measures, but not using due diligence. The declaration itself shows & -want of diligence. The proceedings under the insolvent •debtors’ act were had in February, 1799; it does not, however, appear that the plaintiffs ever made any proofs of •their debt.; or ever demanded a divided .from the insolvent’s estate. They do not even seem to know what it will produce ; they state generally that it will not pay 10s. in the pound. This surely, then, is a want of diligence, and legal measures. Nay, what has been done by them is on the face of it ineffectual: they have only sued out an alias capias ad respondendum. They should have gone on to outlawry, because, by this means, a judgment would have been obtained, on which the plaintiffs might have taken the body or the property in execution. The not stating in the declaration payment of the instalment in 1798, is also an objection. For if not paid at the day, it was the duty of the plaintiffs to have then proceeded; this ought to have been made appear, because, if the 1,000 dollars were neither paid nor sued for, the plaintiffs lost all right to look to the defendants for any future sums. This will be deemed no more than a fair consequence; for had, in May, 1798, *a suit been prosecuted, judgment would have [*432] been recovered .for the whole penalty, which would have stood as a security, and would have bound the lands of the obligor. As, therefore, nothing of this sort is stated the declaration is in itself wholly defective. For the plaintiffs. The plaintiffs come before the court as fair purchasers; therefore, should they recover any thing it is only getting back their own, and the defendants are not injured. The question is, what does the law require that they should do before they can have a right to recover. This, we are told, cannot arise till all the instalments are due. The words of the bond and covenant are an answer to this; for they are, that the money is to be paid by instalments, and that, as they become due, measures are to be taken for their recovery ; on failure of which, the defendants are to pay such sums as may be “ then” due. It is incongruous to suppose a bond to pay by instalments should not be put in suit till the last instalment is due; and it is equally so, that a covenant to pay, if such bond should not be faithfully discharged, must rest unavailed of, when the bond is not complied with. The argument against the declaration, for not setting forth the payment in.1798, cannot be maintained. Nothing more is necessary than to state a right to resort to the defendants; that did not accrue till 1799. They are called upon for nothing previous, and if we are satisfied as to the payment in 1798, it is all the better for them, who are liable for every separate portion of the whole. Neither can the averment be objected to ; we state Bennington became, and was, insolvent. The covenant requires no more; it does not exact a continuance of his insolvency to be shown. If he was at any time unable to pay, it is sufficient; for the covenant does not require that we should wait till he becomes solvent again. If this reasoning is good in one instance, it is in a thousand, and may be insisted on over and over again. We show the insolvency by the absconding, and proceedings under the absconding debtors’ act; the non-payment on the 1st of May, 1799, and the legal measures taken by issuing the writs mentioned. The next objection *is the want of due diligence. [*433] We are required to institute suits only as the sums become due; that is all the diligence required. The instalment of 1798 must be presumed to have been paid ; unnecessary, therefore, to sue for that; and a writ did issue for the one in 1799. To continue proceedings on to outlawry, without any chance of recovery, was not only useless, but would have been unjust, as all the costs would have fallen on the defendants, the record itself showing every part of Bennington’s property assigned under the law against absconding debtors. It could, therefore, never have been the intention of the parties to thus unnecessarily saddle themselves with expenses; and it is a general rule, that covenants and conditions should be so expounded, as to serve the intention of the parties. This species of diligence could, therefore, never have been contemplated. The covenant of the defendants was in case of Bennington’s insolvency, or inability, to place themselves in his situation, and pay, as he would have done, by instalments. The inadequacy of the estate of Bennington to pay more than 10s. in the pound, is a proof of his incapability, and it does not appear that even that has been paid, or could have been received. Allowing Bennington to have property abroad, and so, in fact, not insolvent, we are not to look to any thing beyond this state, and the jurisdiction within which the covenant was made. On our part, nothing appears to bind us to prove our debt. It was not our duty; the defendants are the legal creditors, and we could, at the most, be only trustees. They, therefore, having the legal right, are the parties" who ought to have come forward to substantiate the demand. As to the payment of 1798, we are at issue on that, though, we suppose, whether paid or not, is immaterial ; for, as we may now remit the whole, and exonerate from all, we surely have the same right over a part. Harison, in reply. That the intent of the parties is to govern, we are on both sides agreed. "What that is, must) however, be shown from, the instrument; nor can the court look beyond it. The cases in which the defendants are te be liable, depend on conditions precedent. If so, [*434] then not *only an insolvency and inability in Bennington to pay must be shown, but instantly afterwards, due diligence and legal measures. Even the insolvency and inability is not shown positively ; it is only “etsic” How a seizure and sale of all a man’s estate and effects in one county, and their being insufficient, is not enough; there may be more than enough to pay all his debts in another, In trover, a demand and refusal is evidence of a conversion ; yet, if stated in the pleadings, that the articles by finding came into the hands of the defendant, who, on demand, refused to deliver them, and so he converted them, it would not be good, because the demand and refusal might not amount to a conversion. The necessity of further proceeding than the mere issuing a copias' and an alias copias will fully appear, if it be considered, that had a judgment been obtained, it would have bound subsequently acquired lands, and even in the hands of executors. Besides, the diligence covenanted for requires more. The plaintiffs held the only evidence of the debt due from Bennington; this they ought to have proved under the assignment made by virtue of the absconding debtors’ act, that those for whom it was held might come in for the benefit of a dividend on the amount. Allowing, therefore, the insolvency, and our liability, the court will necessarily say we are, on this ground, discharged. The passing over the first instalment is not quite clear. It is contended the plaintiffs might remit that payment. Ho such thing; for if unable, and in tottering circumstances, legal steps ought to have been instantly taken, and a judgment obtained for the amount of the whole bond to give that priority and lien which now is lost. It was giving time, and that will make the debt the plaintiffs’ own. The obtaining payment.of the first instalment was a condition precedent to our liability, and ought, therefore, to have been shown. As it has not, the defendants cannot be be called on in this action. [MAJORITY — Thompson, J. Radcliff, J. Kent, J. Lewis, Ch. J.] Thompson, J. The exceptions taken to tb i declaration are, 1st. That no action could be maintained on the covenant against the defendants, until the last instalment on the bond fell due, which was in May, 1801. The present action was commenced in 1800. *2d. The insolvency, or inability of Bennington [*435] to pay, is not sufficiently averred. 3d. It does not appear that due dilligence has been used against Bennington, to recover the money. 4th. Ho notice is taken of the payment that fell due the 1st of May, 179,8. I think all the objections untenable. The-reason urged in support of the first is, that although Bennington might have been insolvent in the year 1799, the time alleged in the declaration, he might not have been so in the year 1801, when the last instalment ■ fell due; and that the covenant only goes to the eventual responsibility of Bennington. This construction appears to me not warranted, either by the terms of the covenant, or what may reasonably be presumed to be the intention of the parties. The bond is made payable by instalments; the general object of the covenant was, to make the defendants responsible for those payments, and a fair interpretation would be, unless a contrary intention was clearly inferrible from the terms of the covenant, that they became security to pay, according to the condition of the bond, in case of Bennington’s insolvency, or inability to pay. This construction is conformable to the general intent and understanding of parties with respect to securities, and there seems nothing peculiar in the phraseology of this covenant, to warrant a different conclusion. The covenant expressly refers to the bond, and purports to guaranty the payment, I think, according to the condition; and if so, there is a breach of the covenant, whenever there is a failure of payment agreeable to the terms of the bond. The assignees have pursued the obligor according to the provisions contained in the covenant. If this covenant would warrant a different construction, it would be, I think, that the whole sum was payable by the defendants, immediately on the insolvency of Bennington ; for the covenant concludes, that then, and in such case, (alluding to the insolvency,) they were to pay “ the amount of the said bond, or such part as remained due.” The result, however, as it respects the present question, would be the same on either construction. The insolvency, or inability of Bennington to pay, appears [*436] *to me to be fully and sufficiently averred. The averment is in the very terms of the covenant, to wit, that on the said 1st day of May, 1799, and long before, the said Jonathan was insolvent, and not able to pay and satisfy the said bond. It is said, however, this is a dependent averment, and is alleged as a conclusion drawn from a detail of facts, and which do not warrant the inference. The facts stated, appear to me fully to warrant the conclusion drawn. They are, that Bennington had, some time previously, absconded, and departed from this state to parts unknown,- and still doth continue absent from the state, at some place unknown: that he had been duly proceeded against as an absconding debtor; and that the result was, that his estate was not sufficient to pay his creditors 10s. in the pound. It was admitted, on the argument, by the defendant’s counsel, that if the averment had been general that Bennington was insolvent, and unable to pay, without detailing the facts from which the conclusion was drawn, t]le declaration would have been good. Admit the declaration to have been thus drawn, and issue had been taken upon the solvency of Bennington, and the facts detailed in the declaration had been proved on the trial, would they not have warranted the jury in pronouncing him insolvent, or unable to pay the bond? I think, clearly, they would. These facts l-t-ung admitted by the demurrer, I think the court is bound to make the same conclusion. It is also said, the plaintiffs ought toffiave shown how much they had received on a distribution of Bennington’s estate among his creditors. This appears to me to be rather matter of defence, and incumbent on the defendants to prove. If the plaintiffs had received anything, it would have been proper evidence, under plea of payment by Bennington. Besides, the declaration does contain an averment that they have not received payment for the instalments, for which the action is brought. The third exception is, that the plaintiffs have not shown due dilligence in prosecuting Ben'nington; that they ought to have proceeded to outlawry. I think it manifest, that such extraordinary proceedings were not in contemplation of the parties; and, therefore, that the covenant ought not to ^receive such a construction as to make them [*437], requisite, unless clearly warranted by the terms. The plaintiffs were to use all due diligence, and take all legal measures, by prosecution at law, to recover the money from Bennington; by which I would understand, all ordinary legal measures, prosecuted with good faith. In the present case, the plaintiffs allege, that soon after Bennington absconded, proceedings were commenced against him as an absconding debtor, and prosecuted with due diligence, in order to secure his property; and for the purpose of arresting his person, ordinary process issued on the very day the payment fell due; all which, I think, show due diligence, sufficient to satisfy the terms of the covenant, and the intention of the parties. The last exception is, that no notice is taken of the payment that fell due on the 1st of May, 1798. It is, I think, a sufficient answer, to say that no demand is made on the defendants for that instalment: and the presumption is, that it has been paid, since the plaintiffs were bound to proceed against Bennington, as soon as the payment fell due, which they appear to have done with respect to the second instalment, the very day it became payable. Any delay, or loches of the plaintiffs in this respect, however, it appears to me, can only be alleged when'a demand is made upon them for that instalment. It is said, that if a suit had been commenced on the bond for the first payment, the judgment would have been for the penalty, and would have been a security on his property for the future payments. This objection fails, without assuming several facts of which nothing appears. Ho evidence that there was any default with respect to this payment; or, but that a suit was commenced, and satisfaction made before judgment, or that he had any real estate which the judgment would have bound. If there were any circumstances of this kind, whereby any loss might probably be sustained for want of due diligence in procuring payment of the first instalment, it might have- been proper evidence for the defendants to have availed themselves of on the issue with respect to due diligence, but can never be ground for the demurrer to the declaration. I am, therefore, of opinion, that [*438] neither of the *exceptions are well taken, and that the plaintiffs ought to have judgment. Radcliff, J. The first and principal objection is founded on a strict and literal construction of the terms of the covenant. The bond is conditioned for the- payment, of' four annual instalments of 1,000 dollars each. The defendants assigned this bond to the plaintiffs, and covenanted that in case the obligor should become insolvent, or not be able to pay the said bond, and if the plaintiffs should use due diligence, &o. to recover the same “ immediately after the said several sums of money expressed in the condition, should respectively become due, and should not be able to compel the payment thereof, then the defendants would pay to the plaintiffs the amount of the said bond, with interest, or such part thereof as should then remain due." It was contended by the defendants’ counsel, that by the terms of this covenant, the defendants cannot be held to pay, until all the instalments shall become due; because the covenant is entire, and contemplates a single payment of the amount of the Said bond, or such part thereof as shall remain due. Confined' toi these terms, it would be susceptible of this interpretation: But, I think, it would equally admit of the opposite construction ; that on the failure of the obligor to pay the firstinstalment, the defendants should be liable to pay the whole.The event in which the defendants were to become answerable, was the insolvency of the obligor, or as it is expressed in the covenant, if he should not be able to pay the said bond,.kc. and if the plaintiffs could not recover the same,, (the bond,) that the defendants would pay the amount of the said bond. If the obligor was not able to pay the bond,' and the plaintiffs not able to recover the bond, immediately after the respective instalments became due, then the casus occurred, and the defendants were to pay' the bond, not any particular instalment. Now, if the term bond is to bó con-, Strued in the same sense throughout this covenant, as the penalty would become legally forfeited on the failure of the first payment, the defendants, according to the letter of their engagement, might be considered'liable to pay the whole' bond. There is an additional reason, too, in favor Of this "^construction ; for, the moment the insol- [*439] vency of the obligor happened, there could remain little hope or expectation of recovering the subsequent instalments from him; and it might rationally be intended, that the defendants should at once take back their security against him, and pay the plaintiffs 'the consideration of the assignment which they had already received. But I think either of these constructions too rigorous, and opposed to the intent of the covenant. The bond was due to the defendants by instalments. The sums in the condition were, in reality, the debt. By the assignment, they meant to' substitute the plaintiff's in their stead, and they guarantied the solvency of the obligor, and the payment by him, according to the terms of the condition. This was the sub-' stance of the contract, and the foundation of the covenant t ' which, I therefore think, ought to be taken distributively. and deemed a continuing covenant, on which the defendants would be liable on the failure of the payment of each ■ instalment. With respect to the other objections which have been stated, I acquiesce in the opinion already delivered, and, generally, for the reasons which have been assigned. I am, therefore, of opinion, that the plaintiffs are entitled to judgment on the demurrers. Kent, J. This case comes before the court on demurrer to the first and third replications. Upon the argument of these demurrers, the counsel for the defendants relied upon what they contended to be substantial defects in the declaration. It was there that the first fault was to be found, and to which they choose to resort. The action was commenced in July term, 1800, and the last instalment on the bond was payable on the 1st of May, 1801; and it was contended, that the defendants were not liable upon their covenant until all the moneys on the bond became due. An important question accordingly arises on the construction of the covenant. It was to pay the amount of the bond, with interest, or such part as should remain due and unpaid. But there were two conditions precedent to recovery upon this covenant. [*440] *lst. That- the obligor should become insolvent, or not able to pay and satisfy the bond. 2d. That the plaintiffs should have used all due diligence, and have taken all legal measures, by prosecution at law, to recover the same, and that, too, immediately after the several sums of money should respectively have become due, and should not have been able, by such means, to have compelled the payment thereof. The bond was payable by instalments, and there can be no doubt but that the obligor was liable to suit on default of payment of any of the instalments. Coates v. Hewit, 1 Wils. 80; Hallet v. Hodges, Sayer, 29 ; Buller, 168 ; Marsen v. Touchet, 2 Bl. Rep. 706. As to the cases in Co. Litt. 292, b. and 1 H. Bl. 547. they relate only to debt on simple contract, or single bill. But the covenant was not, by the terms of it, to indemnify by instalments; it was to pay the amount of the bond; and that, too, only upon the condition that the obligor was not able to pay the bond, 'and that the plaintiffs had used all legal means to recover the same, immediately after the sums had respectively become due, and had not been able to , compel payment. The language of the' covenant throughout has reference to the bond as one entire debt, and the payment to be made by the defendants, in pursuance of the covenant, was of one aggregate or entire sum; or, so much thereof as should remain unpaid. I am of opinion, therefore, that the defendants were not liable on their covenant until all the payments on the bond had become due. Thé burden of suing and collecting the instalments was, by thé assignment, cast upon the plaintiffs; and if they could resort to the defendants on the first, or any default prior to the ultimate one, they must be entitled to recover the whole amount of the bond from the defendants before all the instalments were due, and before the legal means had been used to ascertain whether the obligor was, or was not, competent to pay. This would be contravening the express words of the covenant, which were, that the defendants were not to pay until all such means had been used, as the instalments respectively became due. It would be casting back upon the defendants the burden of using thése means, which the plaintiffs had, by the contract -assumed. These conse[*441J quences *appear to me to result from the do» trine maintained by the plaintiffs, and they are too inconsistent with the covenant to be admitted. If, however, the plaintiffs were not entitled to recover the whole amount of the bond, but only the amount of the instalment in arrear, then it would follow, that the defend ants would be subject to different suits upon the covenant, as the defendants on the part of the obligor should respectively arise. But this consequence would be against the rule of law, that for one entire contract, there shall be but one action, and would subject the defendants to the manifest inconvenience of not having it in their power, by the return, and re-ownership .of the bond, to try the experiment o£ legal means on their part, against the obligor. For, I take it for granted, that while the plaintiffs were lawful owners of the bond, (and they would continue owners until default in-the last instalment,) the defendants could not institute a suit upon it; for this might lead to the absurdity of concurrent suits, at the same time, on one instrument, for the £ame penalty, and for the use of different persons. In every view which I can take of this covenant, it admits of but one construction. It was one simple and entire engagement. The insolvency of the obligor, and the efforts of the plaintiffs, were to be first shown with respect to all the instalments. If, might be, that the obligor would return, and be able to pay the bond when the last instalment fell due. The present suit being brought before this period, was prematurely brought, and before the cause of action arose, I am, therefore, of opinion, that, on this ground, judgment ought to be given for the defendants. There was another ground taken by the defendants, that might merit some consideration; I mean the want of an averment in the declaration, that the first instalment was paid, or that due means had been used to recover it.. But •it is not necessary for me, at present, to examine any other point than the one I have considered. Lewis, Ch. J. The question now before the court is, has there been, on the part of. the plaintiffs, a failure in the performance of the condition, on which the defend- ¡ -ants covenanted *to pay, in the event of the ina- [*442] bility or insolvency of the obligor ? ■ It is contended on the part of the defendants, that the .plaintiffs were not entitled to recover until the last instalment should have fallen due-; and then only, on showing that they had duly prosecuted for each as they respectively became due. That the absconding of Bennington, and the proceedings against him under the absconding debtor’s act, were not conclusive evidence of his insolvency. That though, perhaps, insolvent on the 1st of May, 1799, when the second instalment was payable, he might have been solvent at the time of the third or last instalment becoming due. That the terms “ all due diligence” could only be satisfied by a prosecution to outlawry; and that the plaintiffs ought to have applied for, and received, their, dividend under the assignment. There are two events, in either of which the defendants engage to be responsible. The one is, the insolvency of Bennington ; the other, his not being able to pay and satisfy the bond. These might be considered one and the same thing, were it not that the parties intended to distinguish between them. They are in the disjunctive; the one coupled with a condition, the other unconditional. The distinction, in the understanding of the parties, could be no other than that, between an incapacity in Bennington to discharge his debts generally, and a mere inability to discharge the bond according to its condition. In the first instance, the condition compelling the plaintiffs tb prosecute would have been useless; in the second, it might eventually secure the debt. The first question, then, is, was Bennington insolvent within the meaning of the contract ? It is stated, and not denied, that he had absconded before the instalment payable in 1799; had absented himself from the state, and continued without it at the- time of bringing the suit. That, also, previous to that period, his property had. been assigned under the absconding debtor’s act; and ■ that it neated a dividend of but 10s. in the pound. On such assignment, the debtor’s property is devested, his mercantile operations are suspended. ]STo payments can be made to him, [*443] nor can he *dispose of his property. This, in my conception is a complete state of insolvency. Pro* 'ceedings under the insolvent act are not necessary to constitute it. That act is intended as a benefit to the unfortunate, who must be actually insolvent before they' can have ■relief under it. 'But, admitting that in contemplation of the parties, no distinction was intended between the cases of the insolvency of Pennington and his inability to pay, according to the condition óf the bond, but that, in every event, he was bound to prosecute on default of the obligor, has he not complied with such condition ? On the very da,y on which the first default took place, he issued a copias; and, on its return, an alias. Pennington could not be taken being out of the jurisdiction. To prosecute to outlawry a man whose, property had been already assigned for the benefit of his creditors, would have been a useless expense, and could not have added to the security of the debt. The law, therefore, would not impose it upon them. And as the suit was in the name of the defendants, and, in effect, for their benefit, they might have continued the prosecution, had they chosen so to do. As to the plaintiffs’ instituting a new suit on the second default, viz. on the non-payment of the instalment due in 1800, this, also, would have been useless. For, could a recovery have been had in the first suit, it would have answered every beneficial purpose. The j udgment would have been for the penalty, and would have remained a security for the future instalments. With respect to the plaintiffs not applying for a dividend, there appear two answers to the objection ; 1st. It does not appear on the pleadings, that the dividend has not been received; 2d. The defendants were the proper persons to apply for it. They were the obligees originally, and when the assignment under the act took place, the possibility of recovery was defeated; they, by the terms of the contract, then became the substitutes of Bennington to the plaintiffs, and were to look to him, or his property, for an indemnity. On every ground, I am of opinion, judgment must be-for the plaintiffs. Judgment for the plaintiffs. See Loveland v. Shepard, 2 Hill, 139; Eddy v. Stanton, 21 Wend. 255; Curtis v. Smallman, 14 Wend. 231; Morris v. Wadsworth, 17 Wend. 103; Herrick v. Burst, 4 Hill, 650; White v. Case, 13 Wend. 543; The People v. Jansen, 7 J. R. 332; Lamoureux v. Hewett, 5 Wend. 307; Barker v. Sheppard, 11 Wend. 629; Cumpston v. McNair, 1 Wend. 457; Moakley v. Biggs 19 J. R. 69. Rudder v. Price. See Hunt's Case, Owen, 42. 1 Leon. 208. Bishop v. Young, 2 Bos. & Pull. 84, where Lord Eldon says, “Whether the instalments on the note in Rudder v. Price, were due or not, still the form of the action was misconceived.” H. B. It was debt by the payee against the maker; quaere, therefore, as to this. Covenant by the endorsee of the payee of a note not negotiable, to pay to his assignee the amount, in case such assignee should take all, and every legal step to prosecute to effect the maker and payee. The assignee having been nonsuited in Massachusetts, -in an action against the maker, by the payee’s coming into court and disavowing any authority to sue in his name, it was held that covenant might be maintained against the assignor without' proceeding against the payee. Betts v Turner, 1 Johns. Oas. 65, S. C. reported in 2 Caines’ Cases in Error, 305, where the opinion of Kent, J., (which seems the better law, and in which Lansing, Ch. J., concurred,) is stated as the decision of the court, whereas it was contra that of the majority of the bench. The author of this note,- and the profession at large, are under obligations of no small weight to Mr. Johnson for this, and perhaps some 'other corrections in 2 Caines’ Cases in Error. “Inaccurate reports” being, as is justly observed in the preface to 1 Johns. Cas. “the bane of legal science.” It is, however, to be regretted, that the learned editor of those cases did not advert to the decisions in the supreme court, which had been antecedently published. It would have saved to the bar the repurchase of many determinations in Coleman, which follow nearly in succession, and nearly in totidem verbis, in Johnson, as well as some which hardly vary from the statements in Caines. The accident has probably arisen from Mr. Justice Radcliff having been on the bench when all the cases were decided, and having handed over to Mr. Johnson the whole of his notes, without discriminating those determinations which had already appeared.