more accurately, the covenant to pay at the end of each month, for the work done during that month, was dependent on the progress of the work, so far as respected the amount to be paid; but was not dependent on the covenant to finish the work by a day certain. The only doubt is, whether, after the breach of this last mentioned covenant, the defendants were bound to pay for work done after that time.

There is an apparent, and perhaps some real conflict, in the decisions of different courts, on this point. (2 Johns., 272, 387; 10 Johns., 203; 2 H. Bl.. 380; 8 Mass., 80; 15 Mass., 503; 5 Gill & 339*]*Johns., 254.) We do not deem it needful to review the numerous authorities because we hold the general principle to be clear, that covenants are to be considered dependent or independent, according to the intention of the parties, which is to be deduced from the whole instrument; and in this case we find no difficulty in arriving at the conclusion, that the covenants were throughout independent. There are, in this instrument, no terms which import a condition, or expressly make one of these covenants in any particular dependent on the other. There is no necessary dependency between them, as the pay for work done may be made though the work be done after the day. The failure to perform on the day does not go to the whole consideration of the contract, and there is no natural connection between the amount to be paid for work after the day, and the injury or loss inflicted by a failure to perform on the day. Still it would have been competent for the parties to agree that the contractor should not receive the monthly install ment due in November, if the work should not be then finished, and that he should receive nothing for work done after that time.

But we find no such agreement. On the contrary, the covenant to pay for what shall have been done during each preceding month is absolute and unlimited, and the parties have provided a mode of securing the performance of the work and the indemnification of the Company from loss, wholly different from making these covenants in any particular dependent on each other. They have agreed, as will be presently more fully stated, that the Company may declare a forfeiture of the contract in case the work should not proceed to their satisfaction, and may retain fifteen per cent. of each payment to secure themselves from loss. Without undertaking to apply to this particular case any fixed technical rule, like that held in Terry v. Duntze, 2 H. Bl., 389, we hold it was not the intention of these parties, as shown by this instrument, to make the payment of any installment dependent on the cove nant to finish the work by the first day of November; and that consequently the instruction given at the trial was correct.

The sixth instruction, which is also excepted to, must be read in connection with the fifth and the provision of the contract to which they refer. The contract contains the following clause:

"Provided, however, that in case the party of the second part shall at any time be of opinion that this contract is not duly complied with by the said party of the first part, or that it is not in due progress of execution, or that the said party of the first part is irregular or

negligent, then, and in such case, he shall be authorized to declare this contract forfeited, and thereupon the same shall become null, and the party of the *first part shall have no [*340 appeal from the opinion and decision aforesaid, and he hereby releases all right to except to, or question the same in any place under any circumstances whatever; but the party of the first part shall still remain liable to the party of the second part for the damages occasioned by the said non-compliance, irregularity, or negligence.

The instructions thereon were:

5th. "If the defendant annulled this contract, as stated in the testimony, under the belief that the plaintiff was not prosecuting the work with proper diligence, and for the reasons assigned in the resolution of the board. they are not liable for any damage the plaintiff may have sustained thereby, even although he was in no default, and the Company acted in this respect under a mistaken opinion as to his conduct.'

6th. "But this annulling did not deprive him of any rights vested in him at that time, or make the covenant void ab initio, so as to deprive him of a remedy upon it for any money then due him for his work, or any damages he had then already sustained.”

The law leans strongly against forfeiture, and it is incumbent on the party who seeks to enforce one, to show plainly his right to it. The language used in this contract is susceptible of two meanings. One is the literal meaning, for which the plaintiff in error contends, that the declaration of the Company annulled the contract, destroying all rights which had become vested under it, so that if there was one of the monthly payments in arrear and justly due from the Company to the contractor, and as to which the Company was in default, yet it could not be recovered, because every obligation arising out of the contract was at an end.

Another interpretation is, that the contract, so far as it remained executory on the part of the contractor, and all obligations of the Company dependent on the future execution by him of any part of the contract might be annulled. We cannot hesitate to fix on the latter as the true interpretation.

In the first place, the intent to have the obligation of the contractor, to respond for damages, continue, is clear. In the next place, though the contractor expressly releases all right to except to the forfeiture, he does not release any right already vested under the contract, by reason of its part performance, and expressio unius exclusio alteriùs. And finally, it is highly improbable that the parties could have intended to have put it in the power of the Company to exempt itself from paying money, honestly earned and justly due, by its own act declaring a forfeiture. The counsel for the plaintiff in error seemed to feel the pressure of this difficulty, and not to be willing to maintain that *vested rights were [*341 absolutely destroyed by the act of the Company; and he suggested that though the covenant were destroyed, assumpsit might lie upon an implied promise. But if the intention of the parties was to put an end to all obligation on the part of the Company arising from the covenant, there would remain nothing from

which a promise could be implied; and if this was not their intention, then we come back to the very interpretation against which he con tended; for if the obligation arising from. the covenant remains, the covenant is not destroyed. We hold the instruction of the court on this point to have been correct.

The next instruction excepted to, was in these words: "The increased work occasioned by changing the width of the road and altering the grade having been directed by the engineer of the Company under its authority, was done under this covenant, and within its stipulations, and may be recovered in this action, without resorting to an action of assumpsit.'

The covenant of the plaintiff was "to do, execute, and perform the work and labor in the said schedule mentioned." And the schedule mentions "all the grading of that part of section 9, &c., according to the directions of the engineer," &c. We think this instruction was correct. The plaintiff in error insists that the covenant was to do the grading precisely as shown by a profile made before the contract was entered into. If this were so, the Company would have been disabled from making any change either of width or grade, without the consent of the defendant. We do not think this was the meaning of the contract, and both the Company and the contractor having acted on a different interpretation of it, the Company must now pay for the increased work of which they have had the benefit.

The ninth instruction was as follows: 9th. ‘Also, if from any cause, without the fault of the plaintiff, the earth excavated could not be used in the filling up and embankments on the road and at the river, it was the duty of the defendant to furnish a place to waste it. And if the Company refused, on the application of the plaintiff, to provide a convenient place for that purpose, he is entitle to recover such damages as he sustained by the refusal, if he sustained any; and he is also entitled to recover any damage he may have sustained by the delay of his work or the increase of his expense in performing it, occasioned [by] the negligence, acts or default of the defendant." To this the plaintiff in error objects, "that it assumes that the Company was bound to provide a place on which to waste the earth." The contract says the contractor is to place earth, not wanted for embankment, "where 342*] ordered by the engineer." He can rightfully place it nowhere until ordered by the engineer, and if such an order was refused or delayed, and the contractor was thereby in jured, he had a clear right to damages. It cannot be supposed such an order was to be given or obeyed, if obedience to it would be a trespass. Before giving it, the Company was bound to make it a lawful order, the exccution of which would not subject the parties to damages for a wrong, and therefore was bound to provide a place, and, of course, a reasonably convenient place as well as seasonably to give the order.

The plaintiff in error also excepted to the tenth instruction, which must be taken together with the clause of the contract to which it relates, to be intelligible. The contract contains the following provision:

“And provided, also, that in order to secure

the faithful and punctual performance of the covenants above made by the party of the first part, and to indemnify and protect the party of the second part from loss in case of default and forfeiture of this contract, the said party of the second part shall, notwithstanding the provision in the annexed schedule, be authorized to retain in their hands, until the comple tion of the contract, fifteen per cent. of the money at any time due to the said party of the first part; thus covenanted and agreed to by the said parties, this twelfth day of July, 1836, as witness their seals."

The instruction was:

10th. "Also, the plaintiff is entitled to recover the fifteen per cent.retained by the Company, unless the jury find that the Company has sustained damage by the default, negligence. or misconduct of the plaintiff. And if such damage has been sustained, but not to the amount of fifteen per cent. then the plaintiff is entitled to recover the balance, after deducting the amount of damage sustained by the Company.'

It is argued that here is a stipulation that the fifteen per cent. may be retained by the company until the completion of the contract by the defendant; that it never was completed by him, and so the time of payment had not arrived when this action was brought.

Now, it is manifest that one of the events contemplated in this clause was a forfeiture such as actually took place; that in that event the contract never would be completed by the defendant, and so its completion could not with any propriety be fixed on as to the limit of time during which the Company might retain the money, unless it was the intention of the parties that the fifteen per cent. so retained should belong absolutely to the Company in case of a forfeiture of the contract. But the parties have not only failed to provide for such forfeiture of the fifteen *per cent., but have plainly [*343 declared a different purpose. Their language is, that this money is retained, "to indemnify and protect the party of the second part from loss, in case of default and forfeiture of this contract."

There is a wide difference both in fact and in law, between indemnity and forfeiture; yet it is the former and not the latter which the parties had in view. Whether an express stipulation for a forfeiture of this fiffeen per cent. could have been enforced, it is not necessary to decide.

But when the parties have shown an intent to provide a fund for indemnity merely, the legal, as well as the just result is, that after indemnity is made and the sole purpose of the fund fully executed, the residue of it shall go to the person to whom it equitably belongs. Rightly construed, the words" until the completion of the contract" refer to the time during which all monthly payments were to be made, and give the right to retain the fifteen per cent, out of each and every payment, rather than fix an absolute limit of time during which these sums might be retained. In neither event, contemplated by this clause, would this limit of time be strictly proper. If a forfeiture of the contract took place, it was manifestly inap plicable; and if no forfeiture did take place, but damage were suffered by the Company,

from default of the contractor, equal to the fifteen per cent. it cannot be supposed their right to retain was to cease with the completion of the contract. This objection, therefore, must be overruled.

The plaintiff in error also excepts to the 12th instruction. We do not deem it needful to determine whether there was evidence to go to the jury, that the Company did not use reasonable diligence to obtain a dissolution of the injunction, because we consider so much of the instruction as relates to this subject, to be a proper qualification of the absolute and peremptory bar, asserted in the first part of the instruction; and if the Company desired to raise any question concerning the proper tribunal to decide on the matter of diligence, or respecting the evidence competent to justify a finding thereon, some prayer for particular instructions respecting these points should have been preferred. But we consider there was some evidence bearing on this question of diligence, and that it was for the jury and not the court to pass thereon.

Two objections are made to the thirteenth instruction. The first is, that this instruction assumed the existence of evidence, competent to go to jury, to prove that the defendants fraudulently terminated the contract under the clause which enabled them to declare it for feited. To this objection, it is a conclusive answer that the defendants themselves prayed 344*] for an instruction substantially *like that given. The other objection is, that the jury were instructed to allow by way of damages, such profit as they might find the plaintiff had been deprived of by the termination of the contract by the defendants, if they should find

the act of termination to be fraudulent.

It is insisted that only actual damages, and not profits, were in that event to be inquired into and allowed by the jury. It must be admitted that actual damages were all that could lawfully be given in an action of covenant, even if the Company had been guilty of fraud. But it by no means follows that profits are not to be allowed, understanding, as we must, the term "profits" in this instruction as meaning the gain which the plaintiff would have made if he had been permitted to complete his contract. Actual damages clearly include the direct and actual loss which the plaintiff sustains propter rem ipsam non habitam.

And in case of a contract like this, that loss is, among other things, the difference between the cost of doing the work and the price to be paid for it. This difference is the inducement and real consideration which causes the contractor to enter into the contract. For this he expends his time, exerts his skill, uses his capital, and assumes the risks which attend the enterprise. And to deprive him of it, when the other party has broken the contract and un lawfully put an end to the work, would be unjust. There is no rule of law which requires us to inflict this injustice. Wherever profits are spoken of as not a subject of damages, it will be found that something contingent upon future bargains, or speculations, or states of the market, are referred to, and not the differ ence between the agreed price of something contracted for and its ascertainable vaiue, or cost. (See Masterton v. Mayor of Brooklyn, 7

Hill's R., 61, and cases there referred to.) We hold it to be a clear rule, that the gain or profit, of which the contractor was deprived, by the refusal of the Company to allow him to proceed with, and complete the work, was a proper subject of damages.

We have considered all the exceptions; we find no one tenable, and the judgment of the court below is affirmed, with costs.

ORDER.

This cause came on to be heard on the transcript of the record from the Circuit Court of the United States for the District of Maryland, and was argued by counsel; on consideration whereof, it is now here ordered and adjudged by this court, that the judgment of the said Circuit Court in this cause be, and the same is hereby affirmed, with costs and damages at the rate of six per centum per annum.

Cited-6 Biss., 374; 15 Blatchf., 426; 4 Cliff., 13; 1 Holmes, 197.

*MARTIN VERY, Appellant, [*345

v.

JONAS LEVY.

Equity will hold creditor to his agreement to receive specific articles in satisfaction of debt-consideration-If clause in power of attorney is ambiguous, principal is bound by reasonable interpretation upon which agent and debtor acted.

cific articles in satisfaction of a debt, even although In equity, where a creditor agrees to receive speit be a debt upon bond, secured by mortgage, he will be held to the performance of his agreement. ciple, there must be, But, in order to bring a case within this princi

1. An agreement not inequitable in its terms and effect. 2. A valuable consideration for such agree

ment.

3. A readiness to perform, and the absence of laches, on the part of the debtor.

Where the agreement to receive payment in

goods was made by a person who acted under a power of attorney from the creditor, authorizing him to trade, sell, and dispose of notes, bills, bonds or mortgages, and under this power, a partial payrecognized as a payment by the creditor, the power ment was received in goods, which was afterwards was sufficient to authorize an agreement to receive the remaining amount, also in goods, at any time when called for within twelve months, especially as the bond had yet four years to run.

This agreement was not inequitable; there was

a valuable consideration for it; and the debtor was always ready to comply with it, on his part. The creditor cannot now allege fraud in his debtor. It is not charged in the bill; and although he may not have known of the agreement when he might have amended his bill, and charged the bill was framed, yet, when the answer came in, fraud.

The master reported the balance due on the 3d March, 1844, to be $2,002.59, and the value of the goods, 5,776.99. No exception was taken to the report, and it was confirmed.

The court then ordered the complainant to select out of the goods, to the amount of $2,002.59, and on his failure, after notice to his solicitor, that the master should do so. The complainant failed to select ; the master set apart the requisite amount, the residue were redelivered to Levy, and the court decreed that Very should receive the goods so set apart by the master, and that the bond and mortgage were satisfied; denied the relief prayed, and dismissed the bill; all costs to be paid by the complainant. Very appealed to this court. It was argued by Mr. Sebastian for the appellant, and by Mr. Lawrence for the appellee, on whose side there was also a brief tiled by Mr. Pike. Mr. Sebastian, for appellant:

Much irrelevant matter is drawn into the case, which it is not my purpose to notice; and except the points noticed below, the whole de fense fails, upon the well-settled principle that matters set up in an answer by way of avoidance avail nothing unless proved. (1 Munf. Rep., 373; 1 Johns., 590; 14 Id., 74: 4 Paige, 33; Cathcart v. Robinson, 5 Pet. Rep., 267; United States Bank v. Beverley, 1 How. U. S. Rep., 151.)

Under the power given to Davis, he had au thority, as is contended for Very, only to receive the amount of the bond and mortgage in money, or to sell and transfer them, and no other authority whatever to agree to receive at a future day a payment in goods, and to bind his principal so to receive them-no authority to substitute a new contract, by which Very 349*] must *necessarily be a loser, and bind Very to its performance. From the pleadings and evidence, it is clear that Davis did not receive payment, in money or otherwise. Is it not equally clear that he did not sell and transfer the bond and mortgage? And in what part of the power can the authority be found for Davis to bind Very by a new contract, to be performed in future? The whole object of the power was to close up and put an end to his business in Arkansas, and not to entangle himself with new contracts, liabilities, and litigation, and which has been the result of the unwarrantable construction put on the power by Levy, and the unauthorized acts of Davis under it.

This was a special authority to Davis, and not a general one, and Levy- was bound to know the extent of his authority; and if that authority was exceeded, Levy must be the loser by the unauthorized act, and not Very, who gave not the authority. (2 Kent's Com., original ed., 484; Payne v. Stone, 7 Smedes & Marsh. Rep., 373; Gullett v. Lewis, 3 Stewart's Ala. Rep., 26, 27; 1 Hovenden on Frauds; 179, 181; 3 Hill's Rep., 266; Owings v. Hull, 9 Pet. Rep., 628; Story on Agency, secs. 72, 73, 81, 165; Story on contracts, sec. 281; Denning v. Smith, 3 Johns. Ch. Rep., 344.)

And a special power must be strictly pursued, and cannot be enlarged. (Batty v. Carswell, 2 Johns., 50; Mayor, &c., of Little Rock v. The State Bank, 3 Eng. Ark. Rep., 230; 2 Kent's Com., 1st ed., 484; Dickenson v. Gilli land, 1 Cow. Rep., 498; Nixon v. Hyserott, 5 Johns., 59; Story on Agency, sec. 165.)

And although Davis' power should be esteemed, in technical parlance, as a general agency, yet the act performed under it must have reference to, and be limited by, "the purpose for which the power was given." And the purpose in this case, as is clearly shown by the power itself, was not to make new obligations to be performed by himself, but to receive payment and close up finally those [*350 due to him from others. (See 3 Sm. & Marsh. Rep., 613; Story on Agency, secs. 21, 62-69, 83, 89; 6 How. Miss. Rep., 345; 4 Yerg. Rep., 180; Mechanics' Bank v. Bank of Columbia, 5 Wheat. Rep., 337; Story on Contracts, sec. 287.)

And even in such case the act performed must appear to have been a necessary means of carrying into effect the power granted by the principal. And could the new contract made by Davis be deemed a legitimate and necessary means of receiving payment in money, or of effecting a sale of the securities? Surely not. (See 3 Sm. & Marsh. Rep., 613; Story on Agency, secs. 62-69, 33; 5 Johns., 59.)

Here, too, a special power of attorney was given in writing, and such powers are subjected to a "strict interpretation." (Story on Agency, secs. 68, 69; Story on Contracts, sec. 287.)

A factor is a general agent, yet he cannot bind his principal to sales on credit, or to any mode of payment other than the receipt of the money at the sale, unless there be a general usage established controlling such agency. (2 Kent's Com., 1st ed., 485, 486.)

And any general agent to receive payment of a debt is bound to receive it in money only, unless otherwise directed. (Martin's Adm. v. The United States, 2 Monroe's Rep., 90; 4 Yerg. Rep., 180; 6 How. Miss. Rep., 345; 3 Stewart's Ala. Rep., 27; Story on Agency, secs. 62, 98, 99, 181; Story on Contracts, sec. 299.)