which we have been here considering have been applied by Mr. Justice Story to the subject of re-insurance; and it has been held that the party re-insured is entitled to recover a full indemnity for the entire loss sustained by him, and also for the cost and expenses which he has reasonably and necessarily incurred in order to protect himself and entitle him to a recovery over against the re-assurer. The contestation of the suit, however, must be just and reasonable; the expenses must be fairly and reasonably incurred; the conduct of the assurers must be bona fide, and in the exercise of a sound discretion; and as to notice, the learned judge proceeded to say:

"It is precisely in this view that the consideration of notice of the suit becomes most important, even if it be not (as I am not prepared to say that it is) indispensable. If notice of a suit threatened or pending upon the original policy, be given to the re-assurers, they have a fair opportunity to exercise an election whether to contest or to admit the claim. It is their duty to act upon such notice, when given, within a reasonable time. If they do not disapprove of the contestation of the suit, or authorize the party re-assured to compromise or settle it, they must be deemed to require that it should be carried on; and thus, by just implication, they are held to indemnify the party re-assured against the costs and expenses reasonably incurred in defending the suit. If they decline to interfere at all, or are silent, they have no right afterwards to insist that the costs and expenses of the suit ought not to be borne by them, as they are exclusively under such circumstances incurred for the benefit of the reassurers, or are indispensable for the protection of the party re-assured.”

In this case the re-assurers were held liable to pay one half the costs and counsel fees incurred by the assured in the defense of the original suit.*

The French law peremptorily requires notice, if the surety desire to charge the debtor with his expenses. Its language is clear: "The surety who has paid, has recourse against the principal debtor, whether he entered into the contract of suretyship, with or without the knowledge of the debtor. And he shall recover the principal, interest, and expenses; but the surety shall recover only such expenses as are incurred after the principal debtor is notified of the suit against the surety; and the surety shall also recover damages in a proper case.†

* N. Y. State Marine Ins. Co. vs. Protection Ins. Co., 1 Story, 458. "La caution qui a payé, a son recours contre le débiteur principal, soit que le cautionement ait été donné au su ou à l'insu du débiteur. Ce recours a lieu tant pour

We have now to consider the relative rights and liabilities of co-sureties. The right of action of the surety against a co-surety, or his representatives, arises when the surety pays, and not before. And in these cases the surety is entitled to recover against the co-surety, or if more than one against any of them, his aliquot portion of the sum paid. It is not necessary in such case to prove the insolvency either of the principal or of any of the co-sureties. But, on the other hand, the fact of the insolven cy of the sureties will not increase the recovery against those who are solvent.+

But where a surety sues a co-surety for contribution for money paid by the plaintiff on account of the principal, it has been held in Alabama that the defendant may show that the surety suing for contribution was indebted to the principal in a larger amount than he was compelled as surety to pay for the principal, and thus defeat the claim for contribution.‡

The question has been examined as to the right of the cosurety to be reimbursed for a proportion of any costs paid by him. In a case at nisi prius between co-sureties for a tax collector, it appeared that the plaintiff had been sued on the principal's default, and judgment had been recovered, and the plaintiff claim ed, besides half the verdict against him, half the costs of both parties in the original suit. But Lord Chief Justice Tenterden held at nisi prius, that the defendant was only liable for half the verdict. No question was made either as to notice, or the necessity of the suit, nor, would it seem, could any such question properly arise between co-sureties.

But in a more recent case, in the Exchequer, where the plaintiff and defendant had executed, as co-sureties, a warrant of attorney given as a collateral security for a sum of money advanced on mortgage to the principal, and on default being made by the principal, judgment was entered upon the warrant of attorney, and execution issued against the plaintiff, it

le principal, que pour les intérêts et les frais; néanmoins la caution n'a de recours que pour les frais par elle faits depuis qu' elle a dénoncé au débiteur principal les poursuites dirigées contre elle. Elle a aussi recours pour les dommages et intérêts, s'il y a lieu."-Code Civil, Art. 2028.

* Wood vs. Leland, 1 Met., 887.

+ Cowell vs. Edwards, 2 Bos. & Pull., 268.

Bezzell, Adm'r vs. White, 18 Alaba. N. S., 422.

§ Knight vs. Hughes, 8 Car. & P., 467; S. C., M. & M., 247.

was held that he was entitled to recover from the defendant, as his co-surety, a moiety of the costs of such execution, Parke, B., saying, "they are costs incurred in a proceeding to recover a debt for which, on default of the principal, both the sureties were jointly liable; and the plaintiff having paid the whole costs, I see no reason why the defendant should not pay his propor

tion."*

The same principles which we have been considering, are applied to claims made against sureties; so it has been said, that if one become surety for a debtor, the creditor cannot recover from the surety the costs of a fruitless suit against the debtor unless he give notice of his intention to sue.t

It is perfectly well settled in regard to sureties, in suits against them by the principal creditor, that if there has been no fraud, the apparent inadequacy of the consideration will not exonerate them; and that in case of non-payment by the debtor they become liable for the whole debt, no matter how great the apparent insufficiency of the remuneration they receive.‡

A question has arisen on covenants in leases, as between lessee and sub-lessee, which goes to illustrate the general subject which we are now considering. Elizabeth Coppock demised certain premises to the plaintiff with covenant to repair by lessee; the plaintiff demised the premises to one Finch, for a portion of his own term, with covenant to repair and leave in repair, by lessee. Finch assigned to the defendant, who broke the covenant, by leaving them out of repair at the end of the term. By reason of this, the plaintiff was obliged to pay Elizabeth Coppock, the chief lessor, £10 damages and £100 costs of both sides in the suit brought on the covenant. On the question whether the costs were recoverable by the lessee against the sub-lessee, the Court of the King's Bench held they were, saying, "If the plaintiff could not recover those damages and costs against the defendant, he would be without redress

* Kemp vs. Finden, 12 Mees. & Wels., 421. A distinction may, perhaps, be taken between costs incurred in a suit, and upon entering up judgment on a warrant of attorney; otherwise these decisions are inconsistent, and if so, I should consider the former the more correct in principle; for, as between the indorser and maker of a note, there is no contract to save harmless, and each surety should stand ready to pay the debt.

+ Baker vs. Garratt, 3 Bing., 56, per Best, C. J. This was an action against the sheriff for taking insufficient sureties on a replevin bond.

Oakley vs. Boorman, 21 Wend., 588

for an injury sustained through the neglect of the defendant, and not in consequence of his own default."*

Here it will be seen that there was no covenant to indemnify by the sub-lessee, and on this ground the decision which I have just stated has been overruled by the English Exchequer. Price made a lease to Penley, of certain premises, with covenant that he, Penley, would repair. Penley underlet to Watts, also with covenant to repair; but the covenants were dissimilar. Price sued the plaintiff for breach of covenant to repair, in the original lease. The dilapidations proved were £57 10; in addition to which the plaintiff's costs amounted to £36, and the defendant's to £40. These costs were claimed against Watts. The judge who tried the cause held, that as there was no covenant to indemnify, the defendants in this suit were not liable to costs; and the plaintiffs were allowed to recover only the amount of £57 10, with leave to move to increase it by the amount of costs, £76. On showing cause, this was held right, and Parke, B., said: "If the plaintiffs had desired to be secured against these costs, they might have made themselves safe by taking a covenant of indemnity against any breach of covenant in the original lease; and then they might have recovered these costs." And after stating that the covenants were dissimilar, he said: "Under the defendants' contract the amount of damages is the damage necessarily sustained by the breach of their own covenant; i. e., the amount necessary to put the premises in the same state and repair in which the defendants ought to have kept them. If the plaintiffs have expended more, that is their own fault, for which the defendants are not liable."+

We have already considered the general rule by which the surety is denied any remuneration for the remote or indirect consequences of the principal's default.

*Neale vs. Wyllie, 3 B. & Cr., 533.

+ Penley vs. Watts, 7 Mees. & Welsby, 601. Walker vs. Hatton, 10 Mees. & Welsby, 249, affirms this case, and again overrules the case of Neale vs. Wyllic.

Supra, 76, et seq.

CHAPTER XII.

RULE OF DAMAGES AS BETWEEN PRINCIPAL AND AGENT.

Liability of Agents for nominal Damages-The measure of Remuneration is a question of law, whether assumpsit or case be employed-The Agent is charged with the amount of the loss, if he has been guilty of negligence, whether the loss be the direct consequence of his neglect or not-Cases examined-The Agent may show that no loss has resulted-Liability of Principal to Agent-Sub-Agents.

THE class of cases which we next proceed to consider, presents some difficulty in regard to the arrangement of the subject, inasmuch as it is impossible in considering it, to adhere closely to any line of division drawn from the forms of action. Demands made by principals against their agents may be either said to arise from the breach of the agent's contract or from the violation of his duty, and the actions of assumpsit or case can be indifferently used; in the one instance the proceeding being ex contractu, and in the other ex delicto. But inasmuch as the amount of damages, in the absence of any circumstance of fraud or other species of aggravation, is in either form of action a question of law under the control of the court, I shall consider this branch of our subject, as well as that springing from the liability of common carriers, under the general head of contracts.

In regard to the contract of agency, there is a very interesting class of cases growing out of the liability of the principal for the act of the agent. The rule of the civil law qui facit per alium facit per se has been adopted in our law to an extent making the principal in many cases responsible for the negligence or want of skill of the party employed by him. There is also a large class of exceptions where the person though employed by another still carries on a separate and independent calling,