Opinion of the court. The application of this principle to the class of cases to which the one under consideration belongs is equally well settled. If a tenant agree to repair, and the tenement be burned down, he is bound to rebuild.* A company agreed to build a bridge in a substantial manner, and to keep it in repair for a certain time. A flood carried it away. It was held that the company was bound to rebuild.† A person contracted to build a house upon the land of another. Before it was completed it was destroyed by fire. It was held that he was not thereby excused from the performance of his contract. A party contracted to erect and complete a building on a certain lot. By reason of a latent defect in soil the building fell down before it was completed. It was held (School Trustees v. Bennett,§ a case in New Jersey, cited by counsel), that the loss must be borne by the contractor. The analogies between the case last cited and the one under consideration are very striking. There is scarcely a remark in the judgment of the court in that case that does not apply here. Under such circumstances equity cannot interpose. The principle which controlled the decision of the cases referred to rests upon a solid foundation of reason and justice. It regards the sanctity of contracts. It requires parties to do what they have agreed to do. If unexpected impediments lie in the way, and a loss must ensue, it leaves the loss where the contract places it. If the parties have made no provision for a dispensation, the rule of law gives none. It does not allow a contract fairly made to be annulled, and it does not permit to be interpolated what the parties themselves have not stipulated. We are of opinion that the plaintiff below was entitled to recover, but that the court, in denying to the defendant the right of recoupment, committed an error which is fatal to the judgment. * Bullock v. Dommett, 6 Term, 650. † Brecknock Company v. Pritchard, Id. 750. Adams v. Nickols, 19 Pickering, 275; Bumby v. Smith, 3 Alabama, 123, is to the same effect. 3 Dutcher, 513. Gates v. Green, 4 Paige, 355; Holtzaffel v. Baker, 18 Vesey, 115. Opinion of the court. We might here terminate our examination of the case; but as it will doubtless be tried again,-and the record presents several other points to which our attention has been directed, we deem it proper to express our views upon such of them as seem to be material. While a special contract remains executory the plaintiff must sue upon it. When it has been fully executed according to its terms, and nothing remains to be done but the payment of the price, he may sue on the contract, or in indebitatus assumpsit, and rely upon the common counts. In either case the contract will determine the rights of the parties. When he has been guilty of fraud, or has wilfully abandoned the work, leaving it unfinished, he cannot recover in any form of action. Where he has in good faith fulfilled, but not in the manner or not within the time prescribed by the contract, and the other party has sanctioned or accepted the work, he may recover upon the common counts in indebitatus assumpsit. He must produce the contract upon the trial, and it will be applied as far as it can be traced; but if, by the fault of the defendant, the cost of the work or materials has been increased, in so far, the jury will be warranted in departing from the contract prices. In such cases the defendant is entitled to recoup for the damages he may have sustained by the plaintiff's deviations from the contract, not induced by himself, both as to the manner and time of the performance. There is great conflict and confusion in the authorities upon this subject. The propositions we have laid down are reasonable and just, and they are sustained by a preponderance of the best considered adjudications.* JUDGMENT REVERSED, and the cause remanded for further proceedings in conformity with this opinion. * Cutter Powell, 2 Smith's Leading Cases, 1, and notes; Chitty on Contracts, 612, and notes. Statement of the case. HAWTHORNE v. CALEF. A State statute repealing a former statute, which made the stock of stockholders in a chartered company liable to the corporation's debts, is, as respects creditors of the corporation existing at the time of the repeal, a law impairing the obligation of contracts, and void. And this is so, even though the liability of the stock is in some respects conditional only; and though the stockholder was not made, by the statute repealed, liable, in any way, in his person or property generally, for the corporation's debts. THE Constitution of the United States ordains that "no State shall pass any law impairing the obligation of contracts." With this provision in force, the State of Maine, on the 1st April, 1836, incorporated a railroad company; the charter providing that "the shares of the individual stockholders should be liable for the debts of the corporation." "And in case of deficiency of attachable corporate property or estate," the provision went on to say, "the individual property, rights, and credits of any stockholder shall be liable to the amount of his stock, for all debts of the corporation contracted prior to the transfer thereof, for the term of six months after judgment recovered against said corporation; and the same may be taken in execution on said judgment, in the same manner as if said judgment and execution were against him individually; OR, said creditor, after said judgment, may have his action on the case against said individual stockholder; but in no case shall the property, rights, and credits of said stockholder be taken in execution, or attached as aforesaid, beyond the amount of his said stock." Another section provides, that if sufficient corporate property to satisfy the execution could not be found, the officer having the execution should certify the deficiency on the execution, and give notice thereof to the stockholder whose property he was about to take; and if such stockholder should show to the creditor or officer sufficient attachable corporate property to satisfy the debt, “his individual property, rights, and credits shall thereupon be exempt from attachment and execution." The plaintiff, Hawthorne, who had supplied the corpora Argument for the creditor. tion, then embarrassed and insolvent, with materials to build its road, having obtained judgment as a creditor against it, and being unable to get from it satisfaction (the company having, in fact, no property), sued the defendant, Calef, who was a stockholder, both at the time when the debt was contracted and when judgment for it was rendered; and no transfer of whose stock had been made. A few months after the debt was contracted, the legislature of Maine passed a statute repealing the "individual liability" clause of the charter. On a question before the Supreme Court of Maine,―the highest court of law in that State,-whether such repeal was or was not repugnant to the clause, above cited, of the Constitution, that court held that it was not; that the original provision,-not making the stockholder personally hable in any way,-did not constitute a "contract" between the creditor and him, within the meaning of the Constitution; and that, while, but for the repealing act, the plaintiff would have been entitled to recover of the stockholder individually to the extent of his stock, this repealing act had taken away and destroyed such right. Judgment being given accordingly, by the said court, in favor of the State statute, the correctness of such judgment was now, on error, before this court. Mr. Curtis, for the creditor, Hawthorne: A charter is a contract between the State and the corporation; but not necessarily between them only. If it contain provisions on which third persons are invited to give credit, and which hold out assurances to them that if they will give credit a certain fund, or certain persons, will become responsible, such assurances, when accepted and acted on, become a contract, the obligation of which is protected by the Constitution. Thus in Woodruff v. Trapnal,* a charter contained the assurance that the bills of a bank would be accepted in payment of public dues. This was held to create a contract with all * 10 Howard, 190. Argument for the creditor. persons who should receive the bills while the assurance remained unrepealed. So in Curran v. The State of Arkansas,* the charter of a bank contained an assurance that a certain fund should be responsible for the debts of the bank, and this was held to amount to a contract with creditors not to divert that fund from the payment of their debts. It has been held by the courts of New York, that such an act of incorporation as this is leaves the stockholders to stand as original contractors, and liable, as such original contractors, for the debts of the corporation; and the fact that the legislature has required the remedy against the corporation to be exhausted before proceeding against the stockholder does not vary the nature or ground of his liability. In Corning v. Me Cullough, the court say: "The original stockholders, by their acceptance of the charter, and subsequent purchasers in becoming members, assented and agreed to the terms and conditions of the act of incorporation. The defendant in this suit, in common with the other stockholders, by his acceptance of the charter, agreed to its terms, and especially to that feature of it so strongly marked, of the individual liability of the stockholders, equally with that of the corporate body, for the debts of the company. It is a liability which every stockholder must be understood to assume and take upon himself, and to be under to those who deal with the company. Dealers contract with the corporation on the faith of that security for the performance of the contract. The credit they give is given, and they trust as well to the personal liability of the stockholders, as to the responsibility of the corporation, for the fulfilment of the engagement; and each stockholder incurs that liability to the creditor the moment the contract of such creditor with the company is consummated." In Conant v. Van Schaick, the question now under consideration arose; and it was held that a law repealing the liabi lity of stockholders was inoperative as to existing creditors, because it would impair the obligation of their contracts. Even if it should be held that no contract existed with * 15 Howard, 304. † 1 Comstock, 47. 24 Barbour, 87. |