1LLLNGWpRTH' " ·. ePAULDING.[

827

as it may be gooq ofthemi'a'ndyet a judgm-ent in favor of one, in an action, brought by.the company, would not avail the others in separate actions ofejectment against them. The case is peculiarly one ip which the jurisdiction of a court of equity' may be invoked in order to avoid a multiplicity of suits. Itbelongs to the class" where a number of persons have sepiuate and individual claims and rights of action against the same party, but all arise fromsome common cause, are governed by the same legal rule, and involve similar facts, and the whole matter might be settled in a single brought by all these persons uniting as co-plaintiffs, or one of the persons Buing on behalf of the others, or even by one person suing for l;dmself alone." 1 Porn. Eq. Jur. §§ 245, 255, 257, 268, 269,273, and authorities cited in note&tothese sections. Crews, v. Burcham,l Black, 352,,357. In such cases the plaintiffs are united by a common tie, created by identity or interest in the decision of the same questions of law ahd of fact, and have a common adversary. The fact that the several tracts of land here in dispute were entered at different dates, and by different persons, is oino consequence, as the validity,of each entry, as against the railroad comdepends upon precisely the same questionsoflaw and fact. Upon the merits, as disclosed by the bill, the case is within the decisiop. just rendered in Railroad 00. v. Forsythe, post, 867. . The demurrer is overruled,and thl;l delendant will answer. Let an injunCQon issue as prayed
BUNN,

J., concurring.

ILLINGWORTH ". SPAULDING

(OIrcuit Court, D. New Jersey.

el

m.

September 28, 1890.)

1.

REJ'ORKA.'fION OJ' CoNTRACTS-PAROL EVIDENOL

9. 'Blll:lil-EvIDENOlI:·. The faot that the license was granted upon the oompromise of a suit for the in. fringement of the patent, 1:>Y the use of only one pair of guides on a single maohine. should 'not restriot the obvious meaning of the' terms used in the l1cense, especially whelj.the bill in the suit for infringement alleged "that defendants bad [Dade o,n6 maohl.ne, employing said invention, rplaintitr's guides,] and that they were threateJiing: ,make and use the aforeslOid maohines in large quantit1ea."

In a suit to resoind or reform a contraot of l10ense fOl'the use of ..guides" for guiding rods in their passage through surface-polishing- maohines, it appeared that, at the time the license wasgranted1 plaintiff was the patentee of the guides. and that defendants were using them ttl a machine then in operation, and that plaintiff threatened suit to enjoin defendants from infrin/png his patent. This suit was compromised, and plaintiff granted defendants a hcense"to use my patent guides for disk-rolling maohines. * * * the said license to become theirs, their heil'S' or assigns', forever. n Subsequently defendants ereoted another maohlne. and manufaotul'ed and used plainti1!'s guides on it. HeW., that the terms of the license were plain, and unambig-uous and did not restriot defendants to the privilege of using the guides only on the maohine in operation when it waa granted, but gave, them the right to use them on any maohlnes they might subsequently ereot.

828

I'JIDERALREPOBTEB t

vol. 48.

*- LICIDiSE-CoNSTRVCTION OF TERMS.

8. SJ.xE--F'RA.un, ANll ¥IBTAXB. " ' Nor wi1.l ncb colltract be resoillded 011 tbe groulld of fraud or 'mistake, wben it appearsthatplaiIl.tiff agreed to the terms of the license 24 hours before he executed it; that itwae draWIl in accordanoe with these terms by one of defendants, who .read It to plaintiftwhen he brought it to him forexecutioD; and that plaintiff himself read it and executed it immediately, without expressing any dissatisfaction, and rejected the Otrer of his counsel to revise it. The license to "use"includes the right to make for use. as without such right the 'Ucense would be nugatory.

! "

, In Equity. J. 'O.ataytO'n. for complainant. R.BiJington and Thoma8 N. McCarter, for defendants.
"

,. GRPlJbN, J. The primary object of this suit is to obtain the reformation Q,r the rescission of a certain contract of li:lense, entered into by the complainant and the dE'fendants on or about the 22d day of April, 1882, "herein and whereby the complainant granted to the defendants the right tq ,use certain"guides" for guiding rods in their passage through surface-polishing machines, of which the complainant was the first inventor, for which'invention he had oli>tainedletters patent on the 4th dliyM August, 1874. !t appears from the proofs in the cause that, in defendants, without the license and against the will of the complhinah't; and in technic'al infringement ofbis letters patent, did construct and use certain guides upon one polishing Dlachine which they were operating, which were in all respects similar to the guides invented by the complainant. Discovering this, the com.plaiilRnt threatened them with a suit in equity to enjoin such use, and to compel the defendants to account for such profits ,as might have accrued to them from it. Negotiations, however, between the parties, resulted in an amicable arrangement of the matters in dispute. The suit was abandoned, and the defendants accepted,:a license:to use the guides,- That license is in the words following: "For and in consideration of five thousand dollal's:($5,QOQ) to be paid as hereinafter specified, I. John Illingworth, of Newark, Essex county, New Jersey. do hereby grant to Spaulding. & Jerlley'.la:perpetuallicensetouse my patent guides for as described in U. S.patent No. 153,677, the said license tobecometheirs. theit: hi#sl or ass,igps'., fOI,eVer. The conditions of the payment of the above sum areas follows: One dollar cash down; one-third of the balance, or $1,666.33, in three months from this date; one-third, or $1,666,33, in nine ]JlonLbs:from this liate, and one-third, or $1.666.33, in tWelve months from this date. Notes for the sums are this day given saidIllingworthbysaidSpalllding, & Co. For themselves, Spaulding, Jennings & Co., as members ofthepool now Reese patent disk-rolling machines, hereby agreeto withhol'dall support and epcouragetnent from Jacob Reese, in any or all attempts which he may make to recover damages in the from the said JohnI:llingwortb., by the alleged infringement of p a t e n t . " , ' it"" 'f; : '. " ' " ' ' " .': Under this hcense,tbe defendants continued to use the guides which placed upontbeir polishingmachine,Jor about fiveyears. "At ''this' timetl,1.e increase of,their businesscQropelle.d;thedefend,.' ;:;';,i:
r , '

V. SPAULDIli"G.

829

ants to build a new and a second polishing machine, to which they affixed the complainant's guides, made according to his letters patent, by themselves. To this new use the complainant objects. He claims that the true intent and meaning of the license which he had granted was simply to authorize and make lawful the use of the one pair of guides on that particular machine, upon which, before then, they had been unla wfully used; that the license in no wise authorized them to make the guides; and that this new construction and use constituted a deliberate infringement of his letters patent. And he further insists that the terms of the license are so vague and uncertain, and that it was obtained under such peculiar circumstances, as to require the consideration of parol evidence, for the purpose of construing it, and reforming it, so that its vagueness may be overcome. And, lastly, that the proofs are so strongly evident of mistake or fraud that the license should be rescinded. and a new one be executed, expressing the real intent amI meaning ofthe parties. The prayer of the bill is in accordance with these allegations. The defendants in their answer, which is under oath, deny, in emphatic terms, any fraud or mistake in the inception of the contract, and claim that the license is in its teruls clear, distinct, positive, and general, and amply justifies the act of which the complainant in his bill complains. There is nothing in the nature of a license in writing to place it outside the well-known rules of construction which are applicable to other contracts in writing. The writing itself is considered the ample and conclusive evidence of the final agreement of the parties thereto, 'and parol testimony to vary its terms is rigidly excluded. It is not the province of the court to make new contracts for parties, at the whim of one ar the other. Rather is it the duty of the court to enforce literally the contract as it appears, unless indeed its unconscionable character or con·ditionsj or· its fraudulent inception, or its evidence of the mutual mistake of the contracting parties, is so clear as to justify an appeal to the conscience of a court of equity. A critical examination of the license now before the court seems to justify the claim of the defendants that it is genpral in its character. In terms it grants to the defendants" a perpetuallicense to use my [the complainant's] patent guidlfs for disk-rolling machines"as described in U. S. patent No. 153,677, the said license to become theirs, their heirs' or assigns', forever." Inartistically asthelicense maybe drafted, its plain, common-sense meaning is too clear to be' clouded even by the very acute and able argument of counsel. The grant was the right to use patent guides forever. The guides were intended for, and were to be used upon, or in connection with, disk-rolling machines. Not only was this right to be the defendants', but their heirs or assigns were admitted to a participation in the benefits of the license. How could stronger language be chosen to express the unlimited use? What wora or phrase can be singled out, which suggests limitation of the grant? It.will not do to ask the court so to construe a writing that doubt may thereby be incorporated between its lines. Words are to be taken: in their usuaL sense and significance. A license to use patent guidelh gepera11y,. for. ·disk;.rollingmachines generally, cannot, by any

Jmo:wrir mlesof construction {' be :lim,ited, to .theIuseof a pair 9f : .'... .... , g1iipes P upona single machine. Upon the argument, it was ;strenuously insisted that the admitted circumstances which led up to.the granting ,of the license clearly show the of the pomplainant and of the defEmdants to; be. to legalize, byt4e license, tlietise@fonepairof;guides only. : These circumstances, so reHed upon, are the previous iIifringementbi the defendants, by the making and by the lise .of one pair of guidesfor one machine only. thethreatened suit for tbat' infringement, iand the negotiations for the settlement of that suit which resulted in this license. The argument is plausible, but the gnawer to it is, 'first, that the words: used by.the grantor do not harmonize with the theory. Starting with the assumption that all the defendants asked, and all the complainant granted, was the right to use one existing pair of-guides, how veryellsy itwoltld have been to have used words which would have effectually limited 'thdicense; and, if such had been the intent of:. the parties, what language would have been more natural or more readily chosen than that which would legalize, in terms, "the guides now in use" by the licensees? The failure to use such phrases or ,iovords;so commonplace, so readily suggesting themselves for such purpose, is strongly combative of the insistment of the complainant as to intent. Nor does the alleged scope and' purpose of. the threatened suit strengthen the argument. It is not Jexact to say that the use of one' pair of guides by the defendants 'Was the sole moving cause of that suit, which 'was, admittedly, settled by the negotiations terminating in the license. 'The distinct and explicit charge in the bill of complaint in that casejs '''that the ,defendants had made, constructed, and used one machine for 'polishing rods, employing said invention, and that they were threaten-ing to make and use the aforesaid machines in large quantities." It -was this broad complaint which the defendants compromised, and the reasonable presumption is that the intent of the parties, in making the contractM license, was. that it should be broad enough to legalize what had, in the suit being compromised, been asserted and admitted to be illegal. Certainly the language of the license sustains such presum ption. It was also cqntended by the complainant that the license in question was a mere naked right to use the guides in question, and that the right to make the guides was 'not granted; hence the admitted making of the guides by-the defendants for their new machine is not justified or authorized by the license, and, in itself, constitutes an infringement of the complainant's' rights. ,But! cannot assent to so contracted a construe,. tion of this writing. The right to us!" the gnides upon disk-rolling machines implies the right to make them so that they may be used. Any .other construction would put the defendants at the mercy of the 'plainant. . If. they could not rightfully make the guides, how could they exercise the right to use which had been granted them? FrOID what "source couldrthey obtain the necessary guides? There is no obligation 'upon the complainanttoBupply them. He does not pretend that 'he made them<fol'\sale, or ever offered them to the public.iAnd, ,jf he del clinedto tnll-ke.the,m'for thedefendant.$; as he lawfullycouldt the reSult

ILLHWWORTH V.SPAULDING.

831

would be that the license would be defeated,and practically become null and void. I think the principle applicable to cases like this is well stated in Walker on Patents, §298: ··An express license to use a limited or an unlimited nuJilber of specimens of a patentt'd article, implies a right to make these specimens, and to employ others to make, and will protect those otheris in making, them for the use of the licensee. " In Stone,.Outter Co. v. Shortsleevea, 16 Blatchf. 381, the same doctrine is held. In'that case the patentee of inventions in steam stone-cuttiug machines granted to a corporation the right to use said patented machine, or aIiynumberof said machines, in it..'l quarry. Held, that the grant conveyed the right to make the machines for said use. In Woodworth v. Curtis, 2 'Woodb. & M. 524, the grant was as follows: "I do lict!Dse and impower the said Thomas H. Holland and his assigns to use one machine in Hostonaforesaid." In construing this license the court say: "The first question is, did this involve the right to make or procure to be made the machine thus permitted to be used? 1 think it did. Otherwise. the Whole license might be defeated, if the grantor refused to make for him at to'make at any but an l'xorbitant price, or demanded another consideratioD for: a right in the grantee to make for himself. under a license like thia." I'think, in accordance with these, it must be considered that, by. which he granted to the, defendants, the complainantimpower,edthem. to make the guides which, he authorized them to As to the charge oUraud on the part of the defendants in obtainingthisJicense; I have failed to find any basis for it in the proofs. The charge as made in the biUofcomplaint is very vague, but, such as it is, it has been fully denied by the answer of the defendants. coxne, the conclusive effect of that answer, it was incumbent upon the complainant to. produce the testimony to the contrary of at least two witnesses, or of one witness and clear corroborating circomstances. The only witness on this point produced by the complainant is the complainant himself; and, taking hie statement of the circumstances under which the license was executed' as uncontradicted ,there can be drawn rio ference of fraudulent design or conduct op the part of the defendants;· eertainly noiBference sufficiently stronj1; to overcome the positive denials of the answer. The severest criticism to be made is that the license was hastily executed by the complainant, but even that was not due to any urgen,oy of the defendants; and that haste did not prevent the reading of it by tluVcomplainant twice before execution. The complainant's testim'ony shows it was read aloud to hiniby Mr. Jennings, and again by the complainant himself, the license having been handed to him for inspectitllLand examination. . But I am forced to the conclusion that,: as to the circumstances surrounding the execution oLthe grant, the memory of Mr. Illingworth is ,somewhat defective. He speaks of but one interview with Mr,Jennings,)and that was the occasion when the license substantially is tha.t Mr., Jennings came to;

882

JJ:EDERAL REPORTER,

vol. 48.

hi$ houEte, after tea, about\7 o'clock in the evening of the22d of April, l.aS2; that almost immediately, without preface, Mr. Jennings offered him $5,000 for the guides, provided he would accept notes in place of cash for the consideration. This proposition the complainant instantly accepted. Mr. Jennings then read over to him the license in question, whioh he had brought with him already prepared, then handed the pa" .per to Mr. Illingworth to read, who, after reading it, went into his library and executed it; the whole interview not consuming more than 10 minutes. I think Mr. Illingworth is mistaken in his rec01lection of this transaction and for this reason,-it will be noticed that no additions to, or alterations or changes of, the document are suggested by Illingworth. Understanding it, as he says he did, it was entirely satisfactory to him. Now,there is a very remarkable clause in that license, wllich certainly would not be looked for in such an instrument. It is contained in that last paragraph, and is·the one in which Messrs. SpauldinK, Jenuings & Co., as members of a certain pool, agree to refuse all support anQ. encouragement to one Jacob Reese, in any attempt which he may make .to recover damages from Mr. Illingworth, a because of an alleged infringement of Reese's patent. lIow did condition or agreement find its way into this license? According to Mr. Illingworth's testimony, no such thing had been.talked about or discussed between Mr. ,J"ennings and himself. Was it a voluntary fert On the part of the licensees, inc(uporated .in the license withoutrequest or demand from the person most interested, that they would withdraw assistance, which, as members of a certain pool, they may have owed to Reese? Such is not the usual way in which business is conducted, and the supposition is not reasonable. But; if we turn to Mr. Jennings' testimony, the whole matter is immediately explained. He says that he had two interviews with Mr. Illingworth, the first on: April 21st, when: the terms of the .license were settled, and the other on the next day, when the license was executed; that at the firsUnterview, after the question of money consideration for the license was settled, Mr. Illingworth said he would add a stipulation to the.!ictlnse, which was that the defendants should lend no assistance to Jacob Reese in any suit which he might bring against Illingworth for the use ·of disk-rolling rna. chines, and to.: this stipulatio}l Mr. Jennings assented, and therefore it was incorporated in the license, which wa.s executed at too interview on the following day. It was practically apart of the consideration of the grant; hence, when it was read to Mr. Illingworth 'he expressed no surprise. It was what he expected. The written document so clearly and distinctly set out the agreement whichhlld been entered into the evening before that, after hearing it read over by Mr. Jennings, when it was placed in his handll for examination he contented himself with merely glancing over it, and then he immediately executed it. Could there be Iltronger evidence that the parol agreement of the evening before was literally and correctly committed to writing, and properly expressed the intent and understanding of the parties? The complainant had 24 hours between agreement to license, and the execution of the it-

ILLINGWORTH

v.

SPAULDING.

833

self, to consider the proposed terms. When the time to execute the license came, upon hearing the terms read over, as they were reduced to writing, he, without a moment's hesitation, executes the contract. To him they are satisfactory. His deliberations have only confirmed him in his intention to grant a license such as the defendants desire, and he acts with a promptness always characterizing the conduct of successful business men. But what becomes of the charge of fraud, and ;enforced undue haste, in the making of the contract? There is another little incident disclosed by the proots, which goes very far to disprove this allegation of fraud and undue haste in this transaction. It is in evidence that, shortly after the executing this license, Mr. Illingworth notified his counsel that a settlement of the threatened litigation with the defendants had been effected. He states the terms of the settlement. His counsel very properly suggests, in view of the importance of the transaction, it would be well to submit to counsel for opinion, and revision if necessary, the writing which contained the terms of the ment between the contracting parties. But Mr. Illingworth refused to do this as wholly unnecessary. He was entirely satisfied with his part in the transaction, and rather congratulated himself that it had been consummated without the assistance of counsel, thereby saving expense. This certainly is strong evidence of his entire satisfaction with the terms of the license. They were fresh in his recollection. The circumstances attendant upon the making of the agreement, and of its execution, were vividly alive in his mind. A copy of the license was in his possession. If he had any doubt of what the license meant, or any awakening suspicions of trickery on the part of the defendants, would he have rejected so brusquely the proffered aid of his counsel? The fair, the necessary inference is that nd such thought as "fraud" or "undue haste" arose in his mind in stating to his counsel the circumstances of the settlement. It was an after-thought which gave birth to his suspicions,-suspiciQns which do not seem to be justified by any fact in the case. The conclusion, then, is that the license embodied the agreement which was entered into by the parties at their first interview; that it is not tainted in any respect, nor made under such circumstances as would warrant any interference with its plain and unambiguous terms by a court of equity; that it is broad enough to protect the defendants in the manufacture, for their own use, of the guides in question, and warrants the' use of such guides upon as many machines as the licensees choose to operate. If the complainant was mistaken as to the legal effect of his grant, it is unfortunate for him; but such mistake affords no ground for rescission or reformation. He may be entitled to sympathy, but he can equitably claim nothing more. The bill of complaint is dismissed, with costs. v.43F.no.12-53

884
'"I'

FEDERAL REPORTER,

vol.

BROWN

EPISCOPAL CITY MISSION

et al v.

et,al.

(OirlYUit OO'Urt, N. D. Imnof.s. July 31,1890.) ,

L

I. 'SAME-BILL

Plaintlfr sell to defendant property subject to a mortgage wbicb defend. ant was to 'assume. Afterwards defendant requested plaintifr, to convey to defend, ant's wife, which he did on defendant's giving a bond guarantying payment of the mortgage by defendant's wife. The mortgage was foreclosed,'a'Ud the deficiency exceeded tl:ie,amount of the guaranty bond executed by defendant. On a bill to en· force payment of the defloienoy, testified that the bond was given be. cause 'had agreed' to assume the mortgage, audthat, jf the property was con· veyedto, his wife, he (defendant) would not be carrying out his· o.ontract. Plaintiff be took a l;lOna because he was "deeding to, a straw grantee,", and tpat the am6unt of the bond was1Ued "as a sort of balance between us in our' liabilities." There was no evidence of any fraud or false statements by defendant to plaintifrto oonveyto ,defendant's wife, or of any statement thatsbe would was aoting as agent for his wife.' Held, , aSBumetbe mortgage, Or that " tbat defendant's wife WRssubstltuted as grantee by consent,and tbat defendant, _ ' could not be beld liable for the entire delloiency. ' , The bond was oonditiohed to indemnify plaintiff against any 109S by reason of a' failure of ,his grantee (defendant's wife), to pay the mortgage on property con-,' to tbe amount of mortgage asveyed to ber byplaintl.!'f to an amount 8umedby plaintiff. Plamtiff,made defaUlt 1n the payment of the mortgage so assumed, by him, and it was discharged b'y defendant. Held" that. a bill by plaintiff and his mortgagee, to whcm he had assigned the bond to enforce payment of a defioiency arising on foreclosure of the mortgage on the prcperty oonveyed to defendant's wife, would be dismissed, since there was no proof that 1>laintiff had paid anything on the mortgage, and defendant's liability on the bond was oanoeled by his payment of the mortgage assumed by plaintifr. '
, ,

AsSVM1'TION OJ' MOl\TGAGE-SUllSTITOTION 011 TnnmPERsoN.

TO ENFORCB-SUlIFICiENCY.

'

8.

S.lJI,-"PAYMENT-STOOXS.

Tbe tact tbat pll'intiff paid with stooks the mortgE'ge which defendant hE'd as8umed will not preventplalntifr from setting ofr against the bond the full amount of luoh mortgage, and defendant oannot, in such case, inquire 1ntot4e actual value of luch stocks. ." .

In George Burry, for complainants. Osborne &: Lynde, for defendants. The };lill in this case,seekf:! to enforce payment of deficiencies remaining unpaid on two mprtgages of $19,500 each, given by George W. Meserve totheEpiscopalCityMission of the city of Boston, OIl March 1,1877, oJ;lce,rtain 10tEi lnthe city of property cOWlred by the ml;lrtgages haying been conveyed by Meserve to the defendant LucyT. Brown, wife of th(l defendant John B. Brown, with a elaPse in the deed of conveyance by which the grantee assumed and ag:t:eed to,pa.y.themortgages in question, !loud said mortgages having been .now in controversy. The facts as fpreclosed, lea,ving fj:0lll thaJ about day of January, 1877, Meserve, by a contract in writing, agreed to sell to defendant John B. Brown, lots 2 and 3, on Purchase street, in the city sub· ject to. a mortgage on each lot to the complainant the Episcopal City Mission, for $19,500, which mortgage Brown was to assume and pay, and Brown was to pay Meserve, in part, by conveying to him certain lots and lands in and about the city of Chicago, upon which.there were