text:
    WILSON v. SAUBLE.
    1. Taxation — Redemption—Invalid Notice. ■
    The notice required by section 140 of the general tax law is intended by the statute to be given and signed by the owner of the tax title, who should state his post office address, so that the owner may be informed to whom he should pay the amount required for redemption, and where he can be reached by mail: signing by any one else than the owner is invalid. 3 Comp. Laws 1915, § 4138.
    2. Same — Amount of Tax — Excessive Demand — Notice.
    Where defendant purchased a tax title of the county treasurer for 1905, of which the redemption period had not expired, so that tlie demand to redeem from tbe tax was premature, nothing appearing on the notice, which required the owner to pay the tax of 1905, as well as other years named, to show whether the tax had been paid as a condition of purchase (in which case it would be rightly included), the notice was void because it named an excessive amount as a condition of redemption.
    3. Same — Redeemable Interest.
    Complainant, who bought the property of V., who had ' originally had a warranty deed made in 1904, and obtained a quitclaim to replace it five years later, after losing the original conveyance, had a redeemable interest.
    Appeal from Genesee; Witliey, J., presiding.
    Submitted January 12, 1916.
    (Docket No. 124.)
    Decided December 21, 1916.
    Bill by Samuel J. Wilson against Charles Sauble to redeem from the sale of land delinquent for taxes. From a decree for complainant, defendant appeals.
    Affirmed.

      McFarlan & Wilson, for complainant.

      Daniel Heims and John H. Tyler, for defendant.
   Bird, J.

Complainant claims to own in fee simple lot 19, block 20, of Oak Park subdivision of the city of Flint, and he seeks by this proceeding to redeem from certain tax sales for the years 1902, 1904, and 1905. The lot was conveyed to William C. Durant and J. Dallas Dort on August 7, 1901. From that date they appear to have been the grantees in the last recorded deed in the regular chain of title until May 21, 1909, when a deed was placed of record conveying the premises to Edwin Van Valkenburg, which deed purported to take the place of a lost deed made in December, 1904, but which was never recorded. The tax title for the year -1902 was purchased by Robert C. McKay, and he subsequently conveyed his interest to William D. Bailey, who purchased the tax titles for the years 1904 and 1905. McKay, learning that Van Valkenburg owned the title, on the 28th day of August, 1907, served upon him the six months’ notice to redeem for the taxes of 1902. Bailey afterwards on August 21, 1908, gave a like notice to Durant and Dort for the years 1902, 1904, and 1905. Defendant claims title through these tax sales, and he resists these proceedings upon the theory that the notices were valid, and that the owners failed to redeem within the statutory period, and that complainant has not sufficient interest in the premises to entitle him to redeem.

1. The point made against the notice served upon Van Valkenburg is that it was signed by Robert C. McKay, who had conveyed the premises to one William D. Bailey at the time the notice was served, and consequently was not then the owner of them. The chancellor was of the opinion that this fact invalidated the notice. Section 140 of the tax law (1 Comp. Laws 1915, § 4138) provides for the giving of the notice, and includes a form to be followed in the preparation of it. The provisions of that section contemplate that the notice shall be given and signed by the owner of the tax title, together with his post office address. The obvious purpose of this is that the owner of the premises may be advised to whom to pay the amount due thereon, and further, that he may be advised where he can reach him personally or by mail. It is true that payment may be made either to the owner of the tax title or to the register in chancery; but the owner has a right to elect to pay the owner of the tax title, and, if he does so elect, it is important that he should be in a position to receive payment and reconvey the premises. We agree with the chancellor that a notice signed by one other than the owner of the tax title falls short of complying with the statute.

2. Exception, is taken to the notice which was served upon Durant and Dort, because it demanded the taxes for 1905 as well as those for 1902 and 1904. The premises had been sold for the taxes of 1905, but the equity of redemption had not yet expired; therefore the demand as to the 1905 tax was premature, and on this, account it is claimed that the total amount claimed vías excessive. The amount paid for each year’s tax was carried out and placed in a column by itself, so that it could be determined from the face of the notice what amount was paid for each particular year.

It is argued in substance that, inasmuch as the amount paid for the taxes of 1905 was severable from the amounts paid for the other years, Durant and Dort might have paid or tendered the amount demanded less the taxes of 1905. This is perhaps so, but the difficulty is there was nothing upon the face of the notice to disclose whether the tax was paid- as a condition of purchase. If it were so paid, it was properly included in the amount demanded. If it were not so purchased, the 1905 tax was improperly included in the notice. As. a matter of fact, the record shows the title was purchased at the county treasurer’s sale and was a voluntary one. We think the amount demanded under this notice was excessive, and therefore invalid under the authority of Teal Lake Iron Mining Co. v. Olds, 178 Mich. 335 (144 N. W. 845); Closser v. McBride, 182 Mich. 594 (148 N. W. 756).

3. Complainant’s right to redeem is questioned because of a lack of interest in the premises. It appears to be conceded by complainant that Durant and Dort had title to the premises. It is shown by defendant that the premises were conveyed to Van Valkenburg in 1904 by warranty deed. Subsequently, and in 1909, a quitclaim deed was given by Durant and Dort to take the place of the warranty deed which was claimed to be lost. It is further unquestioned that Van Valkenburg conveyed to Wilson, the complainant. These latter deeds were of record when these proceedings were begun. This would appear to give complainant the' privilege of raising the questions involved here. Mercer v. Stephens, 185 Mich. 290 (151 N. W. 1032).

The decree of the lower court will be affirmed, with costs to complainant.

Stone, C. J., and Kuhn, Moore, Steere, Brooke, and Person, JJ., concurred. Ostrander, J., did not sit.


source: Caselaw Access Project

author: Bird, J.

license: Public Domain

text:
    PAUL v. GRAHAM.
    1. Frauds, Statute of — Brokers — Writing — Memorandum — Promise to Pay Commissions.
    Under the amendment of Act No. 238, Pub. Acts 1913, avoiding any agreement to pay a commission on the sale of real estate unless in writing, correspondence in which it was stated that a note from plaintiff to defendants might be paid out of commissions earned in selling lands in Florida did not satisfy the statute of frauds, since it did not show all the terms of the contract. 3 Comp. Laws 1915, § 11981.
    2. Same — Written Contracts.
    A memorandum, to be sufficient, must be complete in itself and leave nothing in parol. In an agreement to pay broker’s commissions the time of payment, rate of commission, and time of termination, etc., are essential elements which should be mentioned in the contract.
    3. Same — Value of Services — Quantum Meruit.
    No recovery Is allowed on the quantum meruit for the value of broker’s services, in the absence of a written agreement, as suck a kolding would deprive tke statute of its force.
    Error to Calhoun; North, J.
    Submitted April 6, 1916.
    (Docket No. 36.)
    Decided December 21, 1916.
    Assumpsit by H. M. Paul against William B. Graham, C. W. Shriver, George W. Dunham, and E. C. Humpidge, copartners as Graham & Shriver Company, for commissions on the sale of real estate. Judgment for plaintiff. Defendants bring error.
    Reversed, and no new trial ordered.

      W. S. Powers, for appellants.

      Stewart & Jacobs, for appellee.
   Bird, J.

The defendants were owners of land near Ft. Myers in the State of Florida, and were engaged in selling the same in small tracts of five acres and upwards, upon contracts containing provisions for developing the land by planting grape fruit and orange groves, and caring for them for a stated period. Some time between the 25th day of August and the 6th day of September, 1913, defendants made a verbal agreement with the plaintiff to assist in selling the tracts on commission. The terms of the verbal agreement are in dispute, both as to the amount of the commission to be allowed and the territory in which plaintiff should be entitled to work. The parties worked under this oral agreement until February 9, 1914, when a new agreement was made in writing. Plaintiff claims there is a balance due him under the oral agreement, and this suit was instituted to recover it. Defendants raised the point that the oral agreement for commission could not be enforced, because it was within the recent amendment to the statute of frauds (Act No. 238 of the Public Acts of 1913, 3 Comp. Laws 1915, § 11981), which requires such agreements to be in writing. The trial court was of the opinion that certain letters written by defendants, and certain statements of account which were réndered to plaintiff, took the agreement outside of the statute. The corrected statements credit plaintiff with a commission of $20 per acre, whereas he contends he was to receive $25. One letter advises him that he is credited with $10 on his note and $10 in cash. The letters were written and the statements rendered after the services were performed. The letter which is relied on by counsel to take the agreement out of the statute reads:

“Battle Creek, Mich., Feb. 2, 1914.
“It is agreed between the Graham-Shriver Company and H. M. Paul, that the note bearing even date herewith and attached hereto, is to be paid from commissions earned by H. M. Paul in selling Florida lands of the Graham-Shriver Company.
[Signed] “Graham-Shriver Company,
“Per George Dunn.
“H. M. Paul.”

1. Counsel urge that this letter shows the fact that commissions were to be paid to plaintiff, and therefore is sufficient to satisfy the statute, and he quotes similar provisions from the statutes of other States, and construction of the several courts thereon in support of his contention. This amendment was ingrafted onto section 9515 of the Compiled Laws of 1897, to stand as subdivision 5, and reads as follows:

“Every agreement, promise or contract to pay any commission for or upon the sale of any interest in real estate.”

In the early case of Hall v. Soule, 11 Mich. 494, it was said:

“A promise in writing to pay the debt of another is not valid unless it show the whole terms of the contract ; no resort can be had to parol evidence to add to them.”

This holding was afterwards approved. in Palmer v. Mill Co., 32 Mich. 274; James v. Muir, 33 Mich. 223; McElroy v. Buck, 35 Mich. 434. In Gault v. Stormont, 51 Mich. 636 (17 N. W. 214), this-rule was restated as follows:

“A memorandum to be sufficient, * * * must be complete in itself, and leave nothing to rest in parol.”

Again in Francis v. Barry, 69 Mich. 313 (37 N. W. 353), it was said:

“A complete and binding contract may be created by letters or other writings relating to one connected transaction, if, without the aid of parol testimony, the parties, the subject-matter, and the terms of the contract may be collected.”

And so far as we are advised, this rule has never been departed from in the subsequent decisions of this court. The foregoing letter, tested by this rule, is found wanting. The letter is silent as to the territory-in which plaintiff shall operate. There is nothing to show when the commissions are payable; whether they are payable when the sale is made, or when the vendee makes final payment on his contract. There is nothing to show the rate of commission agreed upon for the sale of the tracts, except the letters and statements of account, and these are asserted by plaintiff to be incorrect, and by defendants to have been made in the nature of a compromise. And there is nothing to show how long the contract should continue. These are important elements, and if we are to overlook them and say that proof of the bare fact that some commission was to be paid is a compliance with the statute, and permit parol proof to make a completed contract, the effect which was obviously intended by the legislature is set at naught, and the controversies which the passage of the act was sought to avoid will still be with us. We think this subdivision 5 should be subject to the same construction that has been given the other subdivisions so far as it is applicable.

2. Plaintiff takes the further ground that if the agreement shall be adjudged to be within the statute, then he is entitled to have the judgment affirmed under his count on the quantum meruit. To sustain that count he showed by competent testimony what the value of plaintiff’s services was for selling the tracts. It has been the rule of this court to permit recoveries for services actually performed under contracts void under the statute of frauds, either at the contract price or under a quantum meruit. Fuller v. Rice, 52 Mich. 435 (18 N. W. 204); Moore v. Nason, 48 Mich. 300 (12 N. W. 162); Smith v. Manufacturing Co., 175 Mich. 371 (141 N. W. 563); Id., 185 Mich. 313 (151 N. W. 1025). If this rule is to be made applicable to this section of the statute of frauds, it would practically nullify the effect of the statute. Demands for commissions by real estate brokers are not usually made or pressed until the contract is performed. This being so, a recovery could be had, in nearly every instance, either at the contract price or under the quantum meruit. In order to give the act the effect which the legislature evidently intended it should have, we have decided to hold that no recovery can be had under this section unless the agreement therefor is in writing. This is in accord with the holding of other courts which have construed similar statutes. Leimbach v. Regner, 70 N. J. Law, 608 (57 Atl. 138); Blair v. Austin, 71 Neb. 401 (98 N. W. 1040); McCarthy v. Loupe, 62 Cal. 299.

In view of this conclusion, the judgment of the trial court must be reversed, and no new trial ordered.

Stone, C. J., and Kuhn, Ostrander, Moore, Steere, Brooke, and Person, JJ., concurred.


text:
    JOHNSON v. GRATIOT COUNTY STATE BANK.
    1. Bankruptcy — Banks and Banking — Deposits—Preferences.
    Where the directors of a corporation had indorsed notes to several banks and, after finding their corporation was hopelessly insolvent, tried to realize on the quick assets to pay off the notes, deposits made with this purpose in view and to the knowledge of defendant, could not be retained and set off by the bank against the insolvent’s notes, which proceeding would amount to a preference, in violation of 30 U. S. Stat. 565, U. S. Comp. Stat. 1913, § 9652.
    2. Same — Res Judicata — Act of Bankruptcy.
    The decision of the referee, confirmed by the court, in a bankruptcy proceeding contested by the bankrupt, that the same was insolvent and had made preferential payments, is conclusive and cannot be collaterally attacked by creditors of the bankrupt or by his trustee.
    3. Same — Record of Proceedings — Jury—Charge.
    The court did not err in permitting part of the bankruptcy proceedings to be read before the jury, later instructing them that the subject matter complained about was governed by the record and it could not be taken into consideration except as the court advised them.
    4. Same — Schedules—Preference—Evidence.
    Evidence that the assets of the bankrupt had been materially reduced by damage caused by a cyclone a few months before the adjudication of bankruptcy was properly excluded by the court, as the question of solvency was foreclosed by the judgment in bankruptcy, and the trial court so ruled.
    Error to Gratiot; Searl, J.
    Submitted April 20, 1916.
    (Docket No. 76.)
    Decided December 21, 1916.
    Assumpsit by D. Lloyd Johnson, trustee in bankruptcy of the St. Louis Chemical Company, against the Gratiot County State Bank for money had and received. ■ Judgment for plaintiff. Defendant brings error.
    Affirmed.

      George P. Stone and L. B. McArthur, for appellant.

      Lyon & Moinet (William A. Bahlke, of counsel), for appellee.
   Bird, J.

A petition was filed in the Federal court on the 25th day of June, 1909, against the St. Louis Chemical Company, by certain of its creditors, praying to have it adjudged a bankrupt. Subsequently the company was adjudged a bankrupt and a trustee appointed. The company became indebted to defendant bank on a promissory note for $5,000, in July, 1907, and the same was renewed from time to time until February 5, 1909, when the company commenced to make payments thereon. From that date up to March 31, 1909, it made several payments aggregating $4,-300. It is to recover this sum that the trustee filed this suit, it being his claim that the payments were made within four months of the bankruptcy proceedings and while the company was insolvent.

1. The principal error relied upon by the bank was the court’s refusal to instruct the jury that under the proofs defendant had a right to set off the amount due on its note against the chemical company’s deposit.

It was the claim of defendant that deposits were made by the company in its bank from time to time, in the usual course of business, and that by reason thereof the relation of debtor and creditor existed, and that after the note became due it had a lawful right under the law to set it off against the deposit, and it is contended that the bankruptcy laws, in express terms, authorize this to be done. The particular section referred to is section 68a of the bankruptcy law (30 U. S. Stat. 565, U. S. Comp. Stat. 1913, § 9652), and it provides in part that:

“In all cases of mutual debts or mutual credits between the estate of a bankrupt and a creditor the account shall be stated and one debt shall be set off against the other, and the balance only shall be allowed or paid.”

Plaintiff, in answer to this contention, concedes that, if the relation existing between defendant and the company had been the ordinary relation existing between banker and depositor, its conclusion would be sound. But it is the contention of plaintiff that the deposits made in defendant bank and the cheeks drawn thereon in payment of defendant’s note were done in pursuance of a fraudulent scheme on the part of the directors of the company, after they knew the company was insolvent, to convert its quick assets into money and pay off, before the crash came, certain notes, including the one in question, which had been indorsed by two of the directors of the company; that the carrying out of this scheme within four months from the date of the bankruptcy proceedings, and while the company was insolvent, created an unlawful preference in behalf of the bank and was in fraud of its other creditors. It was further claimed that the defendant had notice that the company was insolvent and had knowledge of the unlawful scheme when the payments were made.

If it can be said that these claims were supported by competent proof, the trial court was justified in disposing of the matter as he did. The jury were instructed in part that:

“Now, when the money was placed in the bank, the bank would owe the money to the chemical company. The chemical company owed a note to the bank. If the bank received this money in good faith and without knowledge, such knowledge as I have defined to you in my charge here, of the fraudulent intent upon the part of the chemical company, then it would have, the right to offset its note against the money so deposited, and, if the payments were received by the checks for the purpose of making payments upon the note, the bank, under those circumstances, could keep the money. But if it had notice or knowledge, or if in the exercise of bad faith it abstained from learning those things, when it might, by the exercise of reasonable diligence, and would have learned the fact that the money was placed there in pursuance of that plan of the chemical company to pay off certain of its directors and those who were indorsers upon its paper, then the bank could not keep the money and could not offset it against this note, and would have to pay it back to the trustee and receive its distributive share along with the other directors when it proved its claim.”

The testimony tended to show that the directors were indorsers on notes to several banks, and, when it became obvious that the company could not weather the storm, they arranged to realize on the quick assets of the company and pay off these notes, and that during the time they were making these payments the company was insolvent. Testimony was admitted tending to show that notice of these facts was brought home to the defendant. If the jury believed this testimony, the defendant was not entitled to retain the payments because they were received in violation of the provision of the bankruptcy law against preferences. Section 605 of the bankruptcy law.

2. But it is strenuously insisted that there was no competent evidence to establish the fact that the company was insolvent for four months prior to the date of the filing of the petition, and that the directors had knowledge of it. To establish these facts the bankruptcy proceedings were received in evidence. The petition charged that the company was insolvent and had been for four months prior thereto, and that it had created preferences in behalf of certain of its creditors, by making payments on the notes heretofore referred to, including the one in question. The sworn answer denied these allegations. A hearing was had. The referee found the allegations to be established, and the district court later confirmed the finding. The trial court held, and so charged the jury, that the bankruptcy proceedings were conclusive as to those facts.

Defendant insists that the adjudication settled nothing beyond the fact of insolvency of the company at the date of the filing of the petition. The rule appears to be otherwise where the proceedings are involuntary and are contested. In such cases the finding of the referee, when confirmed by the court, is final and conclusive in any collateral inquiry and is binding on the creditors whether they appear or not. This appears to be placed upon the ground that the proceedings are in a sense in rem, and the law makes all creditors parties to the proceeding. Bear v. Chase, 99 Fed. 920 (40 C. C. A. 182); In re American Brewing Co., 112 Fed. 752 (50 C. C. A. 517); Hackney v. Raymond Bros.-Clarke Co., 68 Neb. 633 (99 N. W. 675); In re Hecox, 164 Fed. 823 (90 C. C. A. 627); Cook v. Robinson, 194 Fed. 785 (114 C. C. A. 505).

In the last-named case it was said:

“Now, the creditors of the bankrupt became parties to the proceeding to have him so adjudged and are precluded by the order of adjudication in so far at least as the adjudication determines the insolvency of the debtor, and that he has committed an act of bankruptcy within four months of the filing of the petition. In Bear v. Chase, 99 Fed. 920, 924 (40 C. C. A. 182, 186), a case bearing near analogy upon the facts to the case at bar, the circuit court of appeals for the fourth circuit expressly held that:
‘“Upon the adjudication of the bankrupt, all creditors became parties to the bankruptcy proceedings by operation of law, and particularly these creditors by whose acts the bankruptcy was caused.’
“Here, as there, the person running the attachment is a creditor of the bankrupt, and it was he who through the attachment precipitated the proceeding in bankruptcy. So in Hackney v. Raymond Bros.-Clarke Co., 13 Am. Bankr. Rep. 164, 170 (68 Neb. 633, 99 N. W. 675), which was a contest between a trustee in bankruptcy and one sought to be charged as a creditor having received unlawful preference, the court gave a like rendering of the law, as follows:
“ ‘The defendants in the action are not third parties in the sense that they are in no wise connected with the bankruptcy proceedings, because, for the purpose of these controversies, and in determining their liability, they are sought to be charged as creditors of the bankrupt having received unlawful preferences, and for such purposes were necessarily parties to the bankruptcy proceedings.’ ”

Again in Re Hecox, supra, the court observed that:

“The radical error in the ruling of the district court and the vice in the position assumed by counsel for the receiver before this court consist in undertaking collaterally to controvert the ground of adjudication in bankruptcy. That adjudication determined that the bankrupt was insolvent and while insolvent, within four months of the filing of the petition in involuntary bankruptcy, and because of its insolvency, a receiver had been put in charge of its property by order of the State court. By the amendment to the bankrupt act of July 1,1898 (30 U. S. Stat. chap. 541, § 3a [4]), by Act Feb. 5, 1903 (32 U. S. Stat. chap. 487, § 2), it is declared to be an act of bankruptcy ‘because of insolvency a receiver or trustee has been put in charge of his property under the laws of a State, of a territory, or of the United States.’ Until avoided in a direct proceeding therefor, that adjudication was binding and conclusive on the bankrupt and creditors, as much so as a judgment, inter partes, on due hearing in a court of competent jurisdiction. In re American Brewing Company, 112 Fed. 752 (50 C. C. A. 517); In re Knight, 125 Fed. 35; In re First Nat. Bank, 152 Fed. 65 (81 C. C. A. 260, 11 Am. & Eng. Ann. Cas. 355).”

We think the weight of authority sustains the contention of plaintiff’s counsel and the position of the court that the bankruptcy proceedings were conclusive in these proceedings upon the questions of the insolvency of the company on the date of filing its petition and for four months prior thereto, and that the directors had knowledge thereof.

3. The plaintiff was permitted against objection to read the bankruptcy proceedings in the presence of the jury. It is contended that this was harmful to defendant on the issue which was submitted to the jury. The bankruptcy proceedings were admissible to furnish a basis for the charge of the court that on the day of the filing of the petition the company was insolvent and had been so for four months prior thereto, and that .the directors had knowledge thereof. These were material things for the plaintiff to show. We do not, however, see what necessity there was for reading them into the record in the presence of the jury. If it resulted in any harm to defendant’s case, we think it was cured by the following explanation of the court:

“Certain issues of this case that the court was obliged to receive testimony upon, and a large amount of documentary testimony of what took place in the United States court, was offered and received by the court, but now at the conclusion of the case I determine some of those questions for you, and you need not consider any of the documentary evidence so far as it came from the United States court except as I shall permit you to do so later on in this charge.”

4. After the schedules annexed to the petition had been received in evidence showing the assets of the company, the defendant offered testimony tending to show that the assets were materially reduced as the result of a cyclone which passed over the company’s plant a few months prior to the adjudication. The court rejected this testimony on the ground that the insolvency of the company was foreclosed by the bankruptcy proceedings. Counsel bases his argument on the assumption that the schedules were admitted on the question of solvency. In this he is in error, as counsel for plaintiff stated at the time that they were not offered on the question of solvency, as it was his contention that that question was determined conclusively by the bankruptcy proceedings.

The case seems to have been properly submitted to the jury, and their finding is supported by the testimony.

We are of the opinion that the judgment should be affirmed.

Stone, C. J., and Kuhn, Ostrander, Moore, Steere, Brooke, and Person, JJ., concurred.


text:
    JOHN F. NOUD & CO. v. STEDMAN.
    1. Mechanic’s Lien — Date—Defective Claim.
    A claim of lien for a contractor’s work installing a heating apparatus in a house need not state the date of commencing performance definitely if it states the last date sufficiently to comply with the statute.
    2. Same — Name of Owner, etc.
    But it must state, as required by statute, the name of owner, part owner, or lessee, if known. A failure to observe this requirement is fatal.
    3. Same — Supplemental Evidence.
    The claim on its face must show the essentials without extraneous aid; evidence to supplement it, if deficient in this particular, will not be admitted.
    Appeal from Van Burén; Bridgman, J., presiding.
    Submitted April 11, 1916.
    (Docket No. 101.)
    Decided December 21, 1916.

      Bill by the John F. Noud Company against Alva Stedman, Ellen R. Avery, mortgagee, and others, to enforce a mechanic’s lien. On petition R. R. Brenner was allowed to intervene, claiming a lien. From the decree rendered, defendant Brenner appeals.
    Affirmed.

      Thomas J. Cavanaugh, for appellant.

      David Anderson, for defendant Avery.
   Bird, J.

The purpose of these proceedings is to enforce a mechanic’s lien on certain premises in South Haven. Complainant made parties defendant the owners, mortgagee, and several other persons claiming statutory liens for labor and material. Defendant Brenner petitioned for and was given the right to intervene. He claimed a lien as contractor for the heating apparatus which he installed in the building. A hearing was had on the several claims, and the chancellor allowed some of them, but disallowed others, and among those disallowed was the claim of Brenner. Defendants Stedman, the owners of the premises, did not defend. Ellen R. Avery, the mortgagee, made the defence and is appellee herein. Defendant Brenner is the sole appellant.

1. Among the reasons given by the chancellor for disallowing Brenner’s claim was that the claim.of lien filed with the register of deeds did not definitely set forth when the labor and materials were furnished. That part of his claim appears to be set forth as follows:

“That he entered, upon the performance of his contract on or about the 19th day of December, 1911, and the last thereon on the 17th day of December, 1912.”

Counsel for the mortgagee makes the point that this statement is not sufficiently definite to satisfy the holding in Godfrey Lumber Co. v. Kline, 167 Mich. 629 (133 N. W. 528), where similar language was held insufficient. It will be noted, however, that in that ease both dates were alleged as being “on or about,” whereas in the present case the last date is definite. The last date is the more important of the two, because from the last one it is determined whether the claim for a lien was filed within the statutory period of 60 days. Where the last date is stated definitely, we do not think the claim should be declared fatally defective because the first date is stated too generally. For this reason we think it is quite obvious that, had this distinguishing feature been present in the case of Godfrey Lumber Co. v. Kline, the holding in that case would have been different.

2. A second reason given by the chancellor for holding the notice defective was that it failed to state the name of the “owner, part owner, and lessee, if known.” This is one of the statutory requirements, and a failure to observe it is fatal and will not confer jurisdiction. Waters v. Johnston, 134 Mich. 436 (96 N. W. 504).

An attempt is made to supply this omission by the fact that attached to and made a part of the claim of lien was a copy of the contract made between the Stedmans and Brenner for installing the heating plant. The most that can be claimed for this is that it showed that Stedman & Stedman contracted with Brenner to install the plant, but no language is used therein showing whether they did so as owners, lessees, or tenants. The pleadings are also invoked to aid in this respect. These are of no avail, because the claim on its face should show the statutory essentials without the aid of extrinsic evidence. Godfrey Lumber Co. v. Kline, supra. The failure of appellant to observe the statutory requirement in this respect rendered his claim of lien invalid, and the chancellor was right in refusing to enforce it.

It will be unnecessary to discuss the other questions raised.

The decree is affirmed. Defendant Avery will recover her costs against the defendant Brenner. '

Stone, C. J., and Kuhn, Ostrander, Moore, Steere, Brooke, and Person, JJ., concurred.


text:
    LIEBLEIN v. GEORGE.
    .1. Bankruptcy — Promise to Prefer — Fraud.
    Plaintiff, a creditor, who agreed with a. bankrupt to Indorse the latter’s note for enough to cover a proposed settlement with creditors, if the insolvent would pay his claim in full, could not recover on the contract, which is of a class declared fraudulent and void by the bankruptcy act
    2. Same — Composition.
    In the absence of a new consideration the promise was void, being based on a mere assurance of payment.
    Error to Houghton, O’Brien, J.
    Submitted April 14, 1916.
    (Docket No. 136.)
    Decided December 21, 1916.
    Assumpsit by Edward M. Lieblein against Elias George for goods sold and delivered. Judgment for defendant on a directed verdict. Plaintiff brings error.
    Affirmed.

      Galbraith & McCormack, for appellant.

      Burritt & Burritt, for appellee.
   Bird, J.

Plaintiff is a wholesaler of groceries in the city of Hancock. Defendant is engaged in the retail grocery trade at Houghton. In January, 1911, defendant was declared a bankrupt upon his own petition. Soon thereafter he went,to plaintiff, with whom he had been dealing for several years, and said to him he thought he could make a good settlement with his creditors if he could secure the money to pay them; that he needed $4,700. He proposed to plaintiff that if he would advance it, or aid him in getting it, he would pay him his claim in full, which amounted to $774.32. Plaintiff consented, and indorsed his note, and it was discounted at one of the banks in Hancock. A composition was then arranged by defendant with his creditors of 20 cents on the dollar, and he was subsequently discharged. Afterward defendant paid his note at the bank, but refused to pay plaintiff’s claim in full, as he had agreed. Plaintiff received $154.86, being the 20 per cent, paid him on the composition, which still left a balance of $619.46, and he brought this suit in assumpsit to enforce the payment thereof.

Defendant pleaded the general issue, and gave notice of his discharge in bankruptcy. At the conclusion of the plaintiff’s testimony the trial court was of the opinion that the agreement was one providing for a preference in favor of plaintiff as a creditor, and therefore void, and upon motion a verdict was directed for the defendant. The question presented is whether the view of the trial court was the correct one.

That a preference given by a debtor to one of his creditors is fraudulent and void as to other creditors under the bankruptcy act is not controverted; neither is there any contention over the proposition that an agreement to give a preference is void, and will not be enforced by the courts. But counsel for plaintiff seek to avoid the application of these rules on the ground that the defendant promised to pay plaintiff’s claim in full after the composition was consummated, as well as before, and it is argued that defendant’s subsequent promise brings the case within the ruling of Craig v. Seitz, 63 Mich. 729 (30 N. W. 350), wherein it is said:

“While the effect of the discharge is to suspend the right of action, the debt remains, and the moral obligation to pay it forms a sufficient consideration for the promise to make such payment.”

The distinguishing feature of this case from the present one is that in the case cited the consideration for the promise was in no wise tainted with fraud, whereas in the present one the defendant’s promise before the composition was consummated to pay plaintiff’s claim in full was fraudulent and void as to other creditors. In re Chaplin, 115 Fed. 163; McCormick v. Solinsky, 152 Fed. 984 (82 C. C. A. 134); Tinker v. Hurst, 70 Mich. 159 (38 N. W. 16, 14 Am. St. Rep. 482). The last case cited is very similar to the present one on the facts, although counsel point out the distinction that in Tinker v. Hurst it was shown that the creditor would not agree to the composition until the debtor would agree to pay his claim in full, while in the present case no such demand was made. While the proposition came from the defendant, it appears that plaintiff did not consent to the agreement for a composition until after the proposition had been made, and agreed to by him, and therefore it does not appear to what extent the agreement actuated him in his subsequent conduct. Had it not been for the promise to pay his claim in full, plaintiff might have opposed the composition. He was dealing in the same kind of merchandise, and knew what the assets were worth, and was doubtless well qualified to judge as to whether the offer was a fair one. The first promise is within the ruling of Tinker v. Hurst.

Counsel argue that no fraud was shown, that plaintiff did no wrong in aiding defendant to secure funds with which to settle with his creditors, and they complain of the court for characterizing plaintiff’s act as a legal fraud. When defendant offered to pay plaintiff’s claim in full, on certain conditions, and plaintiff consented thereto, they made an agreement which, if carried out, would have been in violation of the bankruptcy laws. The policy of the bankruptcy law is to have all creditors of the same class treated alike, and in order'to enforce this policy it makes certain acts fraudulent which otherwise would be innocent.

The final question is whether the subsequent promise of defendant will support the action. If it were an independent promise, made after the composition had been effected, without reference to his former promise, it might be construed as valid under Craig v. Seitz, supra; but if it were an attempt to renew or revive the former agreement, with no other or further consideration, it is burdened with the same infirmity as the first. Tinker v. Hurst, supra. We are of the opinion that it was the latter. When defendant was about to renew his note at the,bank, he was asked by plaintiff to include therein the amount coming to him. He refused, but again promised he would pay it after he had paid the note. This simply amounted to a reassurance that he would do as he had previously agreed, and so far as the record shows it appears to have been based upon the same consideration as the first promise.

We think the verdict was properly directed, and the judgment must be affirmed.

Stone, C. J., and Kuhn, Ostrander, Moore, Steere, Brooke, and Person, JJ., concurred.


author: Steere, J.

text:
    DETROIT UNITED RAILWAY v. CITY OF PONTIAC.
    1. Street Railways — Franchise — Eminent Domain — Instructions.
    Plaintiff owned and controlled a franchise to operate electric cars on certain streets of defendant city, which refused to grant a petition for leave to build a passing track 300 feet long on West Huron street between State avenue and Franklin boulevard. In the franchise granted to plaintiff railway company it was authorized to lay single or double tracks on this and other streets with “all necessary and convenient tracks for turnouts, side tracks, switches,” etc. The defendant opposed the location of the switch on the ground that its location would endanger the lives and limbs of school children, because it was purposed to construct the turnout immediately in front of city school buildings: the municipal defendant further offered its consent to a location some distance away from the objectionable place. The jury were instructed that the question for them to determine was whether the inconvenience to the public existed as claimed, because it was dangerous to school children; and, if so, whether the benefits to the company outweighed by a preponderance of the evidence the dangers to school children and to travelers on the streets; that, in order to answer the question in the affirmative, they must find by a fair preponderance of the evidence that the benefits and additional use of the company are such reasonably necessary ones as fairly outweigh- the dangers and inconveniences, if any, claimed by the city. Held, that the charge was not subject to criticism and it was a proper sequence of the preceding instructions to the jury.

    2. Same — Evidence—Streets.
    It was not harmful for the court to grant a request to charge of the plaintiff limited by the court’s suggestion that if the jury could see that it was applicable they might use it, to the effect that the street cars of plaintiff had the same right to travel over the street as other vehicles.
    S. Same — Witnesses—Weight of Evidence.
    Nor did the court commit reversible error in advising the jury that the testimony given by employees of the railway company was not to be given more weight on the question of safety of the school children than the statements of any other witnesses.
    4. Same — Juey—Instructions.

      Held, that the charge of the court was not so argumentative as to prejudice the rights of plaintiff, and, though open to some criticism, fairly presented the issue to the jury.
    Certiorari to Oakland; Smith, J.
    Submitted April 17, 1916.
    (Docket No. 52.)
    Decided December 21, 1916.
    Mandamus by the Detroit United Railway against the city of Pontiac to compel respondent to grant permission to lay certain tracks in respondent’s street. On the determination of issues of facts framed by stipulation and submitted to a jury, the writ was denied, and relator brings certiorari.
    Affirmed.

      James H. Lynch, for relator.

      Andrew L. Moore, City Attorney (Awron Perry, of counsel), for respondent.

      On power of municipality to prevent laying an additional track under a franchise originally granting the right to lay double tracks, see note in 20 L. R. A. 126; 36 L. R. A. (N. S.) 850.

   Steere, J.

Plaintiif, being the owner of a franchise to operate electric cars on certain of defendant’s streets, petitioned the city commission for permission to construct a passing track, 300 feet long, on Huron street west, between State avenue and Franklin boulevard. The petition was denied by the commission, whereupon plaintiif petitioned the circuit court for a writ of mandamus to compel it to grant such permission. An order to show cause was issued and defendant made answer thereto. Following this an issue was framed and the question of necessity for the side track was submitted by stipulation to a jury. They found it was not a necessity, and the writ was denied. We are now asked to review these proceedings upon certiorari.

Plaintiff’s franchise authorized it to lay a single or double track on certain streets in the city of Pontiac, including Huron street west, “with all necessary and convenient tracks for turnouts, side tracks, switches,” etc. Taking this as a basis of plaintiff’s rights an issue was framed and submitted to the jury, as follows:

“Is the proposed side track asked for in this case on Huron street west, in said city between State avenue and Franklin boulevard, necessary and convenient?”

The plaintiff alleged in its petition and argued to the jury that the passing track was necessary to enable it to give adequate service to and from the lakes lying nearby, and to the residents in the western part of the city, on account of the greatly increased traffic to those locations within recent years.

The city commission- opposed the location of the switch between State avenue and Franklin boulevard, for the reason that it would locate it immediately in front of its school buildings, and would thereby endanger the lives and limbs of several hundred school children, and further that a passing track at that point on a 35-foot pavement would be a menace to public travel thereon. It appeared that the commission did not oppose the construction of a passing switch (although it denied the necessity therefor), but opposed its location at the point requested, and offered, before the proceedings were begun, to permit plaintiff to locate it farther west and beyond the school buildings on said street.

All of the assignments of error relate to the charge of the court.

1. The jury were instructed that:

“Now, there is no dispute but that the proposed siding would be of some use to the company and more convenient, if that was the only question involved, there would be no need of your services here for four days, for the court would have been obliged to dispose of it long ago in favor of the company. The precise question is: Are there inconveniences to the public in locating the siding and switch points in that locality, as claimed by the city authorities, are they dangerous to school children involved, as claimed by the city?”

After so doing counsel claims it was error to instruct them as follows:

“If they are, do the benefits to the company outweigh by a preponderance of the evidence, the dangers to the school children, and to travelers on the streets, for, before you can properly answer the question ‘Yes,’ you must find, by a fair preponderance of the evidence, that the benefits and additional use of the company are such reasonably necessary ones as fairly outweigh the dangers and inconveniences, if any, claimed by the city.”

The portion of the charge objected to appears to be a natural sequence of the portion which preceded it. If it were competent to show the convenience or inconvenience to the public and the danger to the school children which the proposed side track would cause, it was proper to use them in measuring the necessity therefor.

8. Plaintiff requested the instruction that:

“Some evidence has been introduced upon the part of the city tending to show that Huron street west has a largely increased number of automobiles since the paving was laid. In that connection I say to you that the automobiles have no superior right on Huron street west over the cars of the Detroit United Railway Company. Under the laws of this State the grant and the authority given by the ordinance referred to, the cars of the Detroit United Railway have the same right to travel over West Huron street as have automobiles or any other vehicles.”

This request was given and followed by a statement that the court was unable to see how the request was applicable, but if the jury could see any application thereof to the issue they could apply it. The court then proceeded to restate the issue. We find no reversible error in the suggestion of the court.

4. In this assignment plaintiff complains of an instruction in which the court advised the jury that they were to take the law from the court and not from counsel on either side. He called their attention to the fact that all the testimony offered by plaintiff had been admitted, and that their attention had been called to all the things requested by plaintiff when they were viewing the premises. He then took issue with plaintiff’s counsel upon certain propositions of law which he had argued in their presence on the previous day. •Inasmuch as counsel does not point out specifically the. error of which he complains, we shall refrain from considering it.

5. In response to plaintiff’s contention the jury were instructed that:

“Another proposition: The statement of counsel, yesterday, in his request and his argument as to the weight to be given to the judgment of the employees of the road. That, because of their superior knowledge, their word should locate the switch. Now, I am willing to concede, and do concede, that upon mere matters of operation, as to what would be convenient and useful to the company, and how its cars could be expedited, and how the time could be kept regular their superior knowledge would give to their testimony more weight than other,”

The court then added the following comment:

“But when it comes to a question of whether it will inconvenience travel on that street, as to whether it will injure thé safety of the children in the schools, and as to whether the city had the right to narrow that street or not, their testimony is of no more value than anybody else’s.”

This observation of the court is not claimed to be at variance with the fact. We think the propriety 6f adding the comment was entirely one of discretion with the trial court.

7. This assignment has reference to a portion of the charge which covers two pages of the brief, and counsel has criticized only one statement therein, and that was the court’s definition of the word “necessity.” Both counsel argue that question, and there appears to be no disagreement between them as counsel for plaintiff announces in his reply brief. The court seems to have been in accord with them, and therefore it is unnecessary to consider it.

There is some general complaint running through counsel’s brief in connection with these assignments that the court made statements that were not justified by the record, and that his charge was argumentative. We think it is true that some things were stated by the court which might have been properly omitted. This was quite likely due to the fact that court, counsel, and jury were all familiar with the locus in quo. And in that portion of the charge wherein the court disagreed with counsel’s legal propositions, his language seems to be somewhat argumentative, but we are unable to say that there was any such impropriety either in his statements or in his charge as to amount to reversible error. The real issue was a simple one. Considerable testimony was taken bearing thereon, and the jury were given the proper test for determining it.

We think the conclusion of the jury is supported by the evidence, and that the order of the trial court should be affirmed, with costs to defendant.

Stone, C. J. and Kuhn, Ostrander, Moore, Brooke, and Person, JJ., concurred. Bird, J., did not sit.


text:
    DETROIT CAVALRY v. RANNEY.
    1. Vendor and Purchaser — Joint Tenancy — Assignment.
    An assignment of all the interest of one of several joint owners or vendees to another interested, reciting the existence of an indebtedness, and providing that the property be platted and sold at the best obtainable price, passed an equitable title to the real estate, and the assignor retained no interest under the land contract.
    2. Same — Equity—Cuban Hands.
    It was, however, an untenable objection that complainant did not come into court with clean hands, because it had violated certain building restrictions on neighboring lots, which were subject in the contract only to the limitation that no building should be erected thereon nearer than 20 feet from the street line, and which did not appear to have been violated.
    Appeal from Wayne; Hally, J.
    Submitted April 10, 1916.
    (Docket No. 51.)
    Decided December 21, 1916.
    Bill by the Detroit Cavalry against Frederick T. Ranney, the Whitney Realty Company, Limited, the Collingwood Land Company, and Floyd C. Williams for the specific performance of a land contract and to quiet title. From a decree for complainant, defendants Collingwood Land Company and Williams appeal.
    Affirmed.

      McPherson, Dunn & Maun (Allan Campbell, of counsel), for complainant.

      Charles Flowers, for defendant Ranney.

      Moloney & Mendelsohn, for appellants.
   Bird, J.

In the year 1912 Frederick T. Ranney sold to complainant upon contract certain lots lying partly in the city of Detroit and partly in the township of Greenfield, and described as: Lots 1, 2, 3, 4, 166, 167, and 168 of Ranney’s boulevard, subdivision of lots A and B of plat of southerly 46 acres of quarter section 26, 10,000-acre tract, according to the plat thereof. Upon payment being tendered and a conveyance demanded of the lots, it was discovered that the estate of Robert Thuner claimed some interest therein, whereupon this bill was filed to compel a specific performance of the contract, and to remove the cloud from the title. The claimed interest of the Thuner estate appears to have arisen in this way: In 1894 Ranney and Thuner were owners in fee of certain real estate, of which the lots in question were a part. A mortgage was held thereon by David Whitney, Jr. Subsequently the mortgage was discharged by Whitney, and Ranney and Thuner conveyed the fee to him, and he in turn gave them a contract of repurchase. Being in poor health and pressed for funds, Thuner afterward made the following assignment of his interest to Ranney:

“For and in consideration of the sum of one ($1.00)’ dollar, I hereby sell, assign and set over unto Frederick T. Ranney all my right, title and interest in and to the above contract.
“Dated, Detroit, Mich., January 14, 1909.
[Signed] “Robert Thuner [L. S.].”

On the same day Ranney and Thuner executed a contract, which recited the fact that they had purchased upon contract from David Whitney, Jr., certain lands, and that Thuner had assigned his interest therein to Ranney. It further recited the fact that Thuner was indebted to Ranney in the sum of $4,-788.85, and that they were indebted to the Whitney estate on said contract in about the sum of $27,000. It then provided that in consideration of the assignment of Thuner’s interest to Ranney, Ranney should make haste in platting the property, and that he should place it upon the market and sell the same for the best price obtainable therefor, and the proceeds therefrom should be disposed of as follows: First, the indebtedness to the Whitney estate should be paid; second, the expenses of platting the property and placing it upon the market and selling the same should be deducted from the common fund; third, that Thuner’s indebtedness to Ranney should then be paid wholly out of Thuner’s share of the profits; lastly, it was provided that the balance remaining should be divided equally, and Thuner’s share paid to him. Later Robert Thuner died, leaving a large number of creditors. The debts were proved against the estate, and application was made by the administrator to sell Thuner’s interest in the land, which was the subject of the assignment to Ranney, and the same was sold under order of the probate court and the defendant Williams was the purchaser thereof, who afterward conveyed his interest to the Collingwood Land Company. The complainant claims that the probate sale was of no force because Thuner had no interest in the lands after making the assignment to Ranney. The defendant Collingwood Land Company claims that the conveyance by Ranney and Thuner to Whitney, and the contract to repurchase, construed together, constituted a mortgage, and consequently the title' to an undivided half of the property remained all the while in Thuner, and that the assignment of his interest in the contract did not carry title to Ranney.

1. In 1894 Ranney and Thuner were tenants in common of the premises in question. To secure their debt to Whitney they deeded the premises to him and took back a land contract, with a provision that in case of default their rights therein should be foreclosed in chancery. The deed and contract read together undoubtedly constituted a mortgage. This being true, the equitable title remained in Ranney and Thuner. While the title stood in this way Thuner sells and assigns his interest in the contract to Ranney, and they, at the same time, execute a contract, which provides what disposition shall be made of the consideration. The assignment, considered in connection with the contract, leads to the conclusion that it was intended to pass the equitable title to the land, with the right to control the legal title. The real consideration for the assignment was a full and adequate one. Thuner was to receive his full share of the profits, whatever sum they might yield, and this fact 'leads to the conclusion that the title was intended to be conveyed. This view is further strengthened by the fact that Thuner recorded the contract as a deed and not as a mortgage, and later when he sold a half interest thereof he described it as a “one-half interest in his share of the profits,” etc.

But counsel argue that the assignment carried nothing with it save a half interest in the contract. What interest was that except the right to pay Whitney’s debt and have the lien discharged? If Ranney paid the debt and had the lien discharged, he would be the loser, unless he could reimburse himself. out of the profits, and he could not do that unless he could sell and convey the lots. We think it is clear that when Thuner executed the assignment, he thereby intended to convert his incumbered title interest into a contract right for a participation of profits. See Hickman v. Chaney, 155 Mich. 217 (118 N. W. 993).

2. The further point is made that complainant does not come into court with clean hands because it has violated certain building restrictions on the lots in the vicinity by erecting its armory on lots 166, 167, and 168. The only building restriction which appears in the contract for lots 166, 167, and 168 is that “no building shall be erected thereon nearer than 20 feet from the street line.” It does not appear that this restriction has been violated; neither dpes it satisfactorily appear that complainant had knowledge of other restrictions which are claimed to have been known and observed by other lot owners in that vicinity before it purchased the lots. The chancellor who heard the cause was of the opinion that the assignment was intended to convey all of Thuner’s interest in the lots, and we agree with him.

The decree of the trial court must be affirmed. Complainant will recover its costs in this court against the Collingwood Land Company. No other costs will be allowed.

Stone, C. J., and Kuhn, Osteandee, Mooee, STEEEE, Beooke, and PEESON, JJ., concurred.


author: Person, J.

text:
    PEOPLE v. LAY.
    1. Criminal Law — Plea in Abatement — Pleading—Court—Bias or Interest.
    A party who interposes a dilatory plea in a prosecution for a criminal offense invites the most rigid scrutiny of its sufficiency, under the well established rules of pleading; and, therefore, a plea in abatement to an indictment for embezzlement, which pleaded the fact that the circuit judge had been employed as an attorney by some of the creditors of the corporation, of which respondent was one of the vice presidents, and was pecuniarily interested in the result of the prosecution, was not sufficient, where the evidence showed that the relation between the judge and the creditors had terminated before he called the grand jury, since the indictment does not place the respondent in jeopardy, but is preliminary to the hearing: also, under the statutes of Michigan, the accused is limited to the one ground of objection, viz., that some one summoned to serve is prosecutor or complainant against him.
    2. Same — Disqualification of Judge.
    And where the circuit judge, who was later called to hear the case, was incapacitated by a similar disqualification, but the presiding judge overruled the motion for a change of venue, calling in another circuit judge to hear the ease on the merits, the accused waived any right to object to having the judge act as substitute in arguing the plea without objection before him.
    S. Same — Bill of Particulars.
    Where a bill of particulars was filed in a criminal proceeding covering the embezzlement of $12,000 of so-called salary, and also covering a further embezzlement of $25,000 for another year, but the trial proceeded throughout in relation to the year 1913, when he received the larger amount of salary, a request to instruct the jury that no claim was made under the bill of particulars for the $25,000 salary, and the evidence about the same could only be considered as bearing on his intent in receiving the $12,000, was correctly refused, for the reason that it was not presented until after the arguments were completed and the case had been tried and argued on a contrary theory.
    4. Same — Evidence—Privilege—Bankruptcy.
    While testimony in a criminal prosecution, showing the sworn statements of respondent upon examination in bankruptcy proceedings of the corporation of which he was an officer, should have been excluded because it was privileged, it could not be said to have prejudiced the accused who afterwards went on the stand and gave testimony relative to the same facts.
    5. Same — Salary—Definition.
    A salary is defined as a periodical allowance made as compensation to a person for his official or professional services or for his regular work.
    6. Same — Conspiracy—Embezzlement—Corporations—Officers.
    Under a charge that respondent and other officers of a corporation had conspired together to wrongfully and secretly convert to their own use funds of the corporation, in form of excessive salaries, ttye evidence showing the taking of the money, and that it was authorized by the conspiring officials, and they, with accused, were in control of the corporate funds, presented an issue which the court rightly submitted to the jury.
    7. Same — Instructions to Jury — Fraudulent Intent.
    And upon proofs that respondent received a large and unauthorized salary, which was charged on the books to a fictitious account, the court was right in charging the jury that the object of introducing evidence about the fictitious account was to show that the true account of the money which respondent received was secreted, but the evidence could not be considered unless the jury also found that the money was so charged with the knowledge and consent of respondent, or with the knowledge and consent of others with whom he was knowingly co-operating in committing the offense.
    8. Same — Conspiracy—Knowledge.
    Where two or more conspire together to commit an actionable wrong everything said, done, or written by any one of them in the execution or furtherance of the common purpose is deemed to be said, done, or written by everyone, and is a relevant fact as against each.
    9. Same — Insolvency op Corporation — Evidence—Intent.
    But evidence as to insolvency of the corporation stood upon a different footing: though respondent joined in a report of its annual condition to the State, showing serious impairment of the capital, the report was not conclusive, when he denied knowing its contents and claimed he had not read it and did not know of the alleged insolvent condition.
    10. Same — Conspiracy—Knowledge—Instructions.
    And where the court charged that if the jury found the corporation was insolvent when his salary was increased, that was not to be considered as indicating bad faith unless he knew of the condition, or unless others with whom he was acting in concert knew of the insolvency, the error was prejudicial and reversible, and it was improper to permit the jury to consider the knowledge of the other conspirators as proof of the motive and intent of the accused.

      Exceptions before sentence from Kalamazoo,* North, J., presiding.
    Submitted April 14, 1916.
    (Docket No. 130.)
    Decided December 21, 1916.
    George T. Lay was convicted of embezzlement.
    Reversed.

      Grant Fellows, Attorney General, and Frank F. Ford, Prosecuting Attorney (Charles W. Nichols, of counsel), for the people.

      Claude S. Carney and William W. Potter, for respondent.
   Person, J.

Respondent was indicted jointly with his brother, Frank B. Lay, Jr., and one Victor L. Palmer, for the alleged embezzlement of a considerable sum of money from the Michigan Buggy Company, a corporation doing business in the city of Kalamazoo. The indictment was returned by a grand jury sitting in and for the county of Kalamazoo, on the 15th day of January, 1914. Separate trials were claimed by the several defendants named therein, and in April, 1915, respondent was convicted of the offense charged. He brings the case here upon exceptions before sentence.

Previous to the trial of respondent, his brother, Frank B. Lay, Jr., had been tried and convicted upon the indictment, and his case has been before this court, and was disposed of by an opinion which will be found ante, 17 (159 N. W. 299). That opinion contains a very full statement of the facts, which are substantially the same in the two cases. In this opinion such only will be given as are necessary to an understanding of the points decided.

Respondent insists that the money which he is charged with embezzling was received by himself and others in good faith as salaries. The prosecution, on the other hand, charge that it was fraudulently taken from the company without any regard to just compensation for services, and that it was termed “salaries” simply as a cover for the defalcation.

Respondent entered the service of the company in September, 1911, at a salary of $300 per month. Its officers at that time were M. Henry Lane, president, Victor L. Palmer, secretary, and respondent’s father, Frank B. Lay, Sr., treasurer. These three owned all of the common stock of the company, and constituted its board of directors. A considerable amount of preferred stock was outstanding, but it had no part in the control of the company. The larger portion of the common stock was held by the senior Lay and Lane in about equal proportions; the amount held by Palmer being less than that held by either of the others. Frank B. Lay, Jr., had been employed by the company for some time and at a salary not exceeding that paid respondent.

Just prior to the annual meeting of the company’s stockholders in April, 1912, respondent and his brother had each been given a small amount of stock so that they might participate in the meeting. At the meeting respondent and his brother were made directors of the company, thus enlarging the board to five members. At the meeting of the directors, which soon followed, the senior Lay was made president of the company in the place of Lane who had held the office for many years, Palmer was elected its secretary and treasurer, and respondent and his brother were each made vice presidents. Mr. Lane was given the office of “chairman of the board.” Before the annual meeting of the stockholders the salaries of the then existing .officers had been fixed for the year by the directors. Mr. Lane, as president, was to receive $6,000, Mr. Lay, as treasurer, $6,000, and Mr. Palmer, $6,000, with an additional $6,000 at the discretion of the directors. It does not appear that any larger salaries had ever been paid during the many years of the company’s existence. Shortly after the annual meeting, respondent, with his father, brother, and Palmer, held a conference at the Burdick House, in the city, and agreed that they would thereafter draw salaries as follows: The elder Lay $85,000 per year, including his dividends, Palmer $25,000 per year, and the two Lay brothers each $12,000. It seems that the dividends which Mr. Lay had been receiving prior to that time had amounted to about $11,000 annually. This conference was unknown to Mr. Lane, and he was not present. Nor was he aware of the alleged increase in salaries until after the company’s failure. His own had not been changed. Neither is it shown that the preferred stockholders were ever told of the amounts being received as salaries by the parties to the conference. After that the salaries of respondent and his brother were again enlarged. From the 2d day of January, 1913, and until July of that year, by an agreement between themselves and. Palmer, each drew at the rate of $25,000 a year. In August the company went into bankruptcy.

Prior to the agreement for the alleged increase in salaries respondent had been paid his $300 per month in two checks of $150 each. The others had received their salaries also by checks. For the purpose of proving the fraudulent intent with which the alleged increase in salaries was made by the parties to the agreement, it was shown that they continued to receive checks for the same amount as theretofore, but that the increase itself was paid to them by Palmer in cash, and that the cash so paid, instead of being entered in the salaries account on the books of the company, was charged partly to advertising, but mostly to a fictitious account in the name of “J. Roach & Co.,” which appeared as an account receivable. This proof was objected to by counsel for respondent upon the ground that respondent was not shown to have had any actual knowledge either of the fictitious account or of the manner in which Palmer was concealing the payment of the increased salaries. It was also shown by the prosecution, as a motive for taking these alleged increased salaries, that the company was insolvent at the time, and its capital stock impaired to the extent of several hundred thousand dollars. This was shown in part by producing the company’s annual report for the year 1912, in which the impairment of the capital stock plainly appeared. Although this report was signed by respondent, with his father, brother, and Palmer (but not by Lane), yet respondent denied all knowledge of its contents and all knowledge of the company’s insolvency. For this reason the admission- of the report and of other proofs of insolvency was objected to by respondent’s counsel.

In August, 1913, as above stated, the Michigan Buggy Company was declared bankrupt. At nearly the same time the Honorable Nathaniel H. Stewart, who ha'd long been a practicing lawyer in the city of Kalamazoo, was appointed circuit judge of the ninth judicial circuit, which includes the county of Kalamazoo. His appointment was made to fill a vacancy caused by the death of the regularly elected incumbent. Judge Stewart continued in office until the general fall election in 1914, when he was succeeded by Judge Weimer. During the period of Judge Stewart’s incumbency, and at the November term of court in the year 1913, he ordered the summoning and impaneling of the grand jury that returned the indictment under consideration.

The errors assigned on this appeal fall into two general groups. .The first relates to the summoning of the grand jury, the qualifications of its members, and to matters preliminary to the trial of the case upon its merits. The Other consists of errors alleged to have occurred at the trial in the admission of evidence, and as to instructions given or refused.

In this case, as in the one against Frank B. Lay, Jr., several pleas in abatement were interposed to the indictment. The first plea alleges that Judge Stewart, before he ordered the grand jury convened, and presumably before his appointment, had been employed as attorney by certain creditors of the Michigan Buggy Company to procure the allowance of their claims against that company. The second alleges that when he ordered the convening of the grand jury he was a stockholder in various corporations to which the Michigan Buggy Company was debtor. Because of these facts it is averred that he was disqualified to order a grand jury, and that all of its acts were therefore void, including the return of the indictment against respondent.

The third and fifth pleas relate to the competency of certain of the grand jurors. By the third it is charged that several of them were stockholders in banks which were creditors of the Michigan Buggy Company and held its commercial paper guaranteed by respondent. One of the grand jurors is said to have been a director in such a bank. The fifth plea charged that the circuit judge, who had, himself, been employed by creditors of the Michigan Buggy Company, and who was a stockholder in various corporations to which the company was indebted, caused the official stenographer of the court to be placed upon the grand jury as a talesman, and that the stenographer had done various things, recited in the plea, tending to show, it is alleged, his prejudice against respondent and an interest in his prosecution.

The fourth plea charged that the circuit judge set aside the lists of jurors that had been returned from the several townships for the current year, and unlawfully caused the grand jury to be drawn from new lists which were returned by his order. This action of the circuit judge is charged to have been unwarranted, inasmuch as the original lists had never been declared illegal. And it is averred that because of this action of the circuit judge the grand jury was not a lawful body, and was not authorized to find the indictment against respondent.'

The pleas contain many inferences of the pleader not warranted by the facts stated. As was said in People v. Lauder, 82 Mich. 109 (46 N. W. 956), under similar circumstances:

"A party interposing such dilatory plea invites the most rigid scrutiny of its sufficiency under the established rules of pleading.”

Considered in the light of this rule, the pleas do not show that either Judge Stewart or any of the grand jurors had a pecuniary interest in the indictment or conviction of respondent. So far as concerns any facts stated, the judge’s employment by the creditors of the Michigan Buggy Company terminated before he called the grand jury. It is urged that he and the grand jurors referred to in the third plea were interested as stockholders in the creditor corporation, because such testimony as would convict respondent would also establish the claims of the several corporations in civil proceedings against him. It was not averred that any civil proceedings were pending or contemplated. And it is not shown how such civil proceedings would be advanced or benefited by respondent’s indictment and conviction. In State v. Rickey, 10 N. J. Law, 83, a plea to an indictment wás held bad which averred that one of the grand jurors was a stockholder in the bank whose funds the respondent was charged with embezzling.

Certainly Judge Stewart would not have been disqualified to call a grand jury even if he had been interested in respondent’s indictment. A grand jury is convened for the general purpose of investigating all such charges of crime as may be brought to its consideration. And it cannot be claimed that a judge’s interest in the prosecution of some particular offender would disqualify him from ordering a grand jury for the purpose of inquiring into offenses generally.

But there is a more complete answer, and it applies to all of the pleas in abatement. The action of a grand jury does not place the accused in jeopardy, in any' legal sense, and is merely preliminary to a trial upon the facts. It is not in the interest of justice that its proceedings should be treated in any captious or technical manner. The statutes of this State have therefore limited the accused to a single ground of challenge, namely, that some one summoned to serve upon the grand jury is a prosecutor or complainant against him. This applies as well to the array as to any single juror. 3 Comp. Laws, §§ 11881, 11882 (5 How. Stat. [2d Ed.] §§ 15052, 15053, 3 Comp. Laws 1915, §§ 15708,15709). The effect of this statute has been considered in a variety of cases. People v. Lauder, supra; People v. Smith, 118 Mich. 73 (76 N. W. 124); People v. Reigel, 120 Mich. 79 (78 N. W. 1017); People v. Thompson, 122 Mich. 411 (81 N. W. 344); People v. Morgan, 133 Mich. 550 (95 N. W. 542); People v. Salsbury, 134 Mich. 537 (96 N. W. 936); People v. Lay, supra. The last case fully explains what is intended by the statute when it refers to “prosecutor” and to “complainant”; and in the light of that explanation it cannot be said that any grand juror in this case was either the one or the other. The pleas therefore should have been, as they were, overruled.

Although, as has been shown, the pleas should have been overruled for lack of merit, yet it is insisted that Judge Weimer was incapacitated from passing upon them, and that his order by which they were overruled was wholly void and of no effect. This contention is based upon the charge that Judge Weimer, as well as Judge Stewart, had been attorney for various creditors of the Michigan Buggy Company in proceedings to collect their demands. After he had disposed of the pleas respondent filed a petition asking for a change of venue and that some other judge be called in to hear interlocutory proceedings. It was alleged in the petition that Judge Weimer had been attorney for various creditors, as hereinbefore stated, and that in one of those proceedings the insolvency of the company was a material issue, as it was in this case. Upon the filing of the petition the judge denied the application for a change of venue, but called in Judge North from another circuit to preside at the trial of the case upon its merits. Respondent had argued the pleas before Judge Weimer without objection, and went to trial before Judge North without suggesting the invalidity of the order by which they were overruled. Now, founded upon that same petition, and after he has been convicted upon the merits of the case, respondent makes the claim that the verdict and conviction should be set aside so that he may have another adjudication upon the merits of his pleas. We do not consider it necessary to pass upon Judge Weimer’s alleged disqualification to act in this case. Respondent had the right to file the dilatory pleas, or not to file them, as he chose. And he had the same right to waive a hearing upon them that he had to refrain from filing them in the first -place. We are not passing upon his power to waive the disqualifications of the judge, but to waive a hearing upon the pleas. When he went to trial before Judge North he knew every alleged disqualification of Judge Weimer, as well as he does now. The petition upon which he founds his present contention had been filed long before. If he thought that the order made by Judge Weimer overruling the pleas was void, he could have insisted that they be passed upon by some competent judge before engaging in the trial upon the merits. Not having done so, he must be held to have waived all right to insist upon them now.

In passing upon the errors alleged to have occurred upon the trial of the case, we will first consider the one relating to the bill of particulars. There were two indictments for embezzlement, it seems, returned against respondent jointly with his brother and Palmer. He was tried under the one which alleged embezzlement of the company’s money during the period when he was receiving the alleged salary at the rate of $25,000 per year. It is stated in the brief of counsel for the people, and is not disputed by respondent, that the other indictment covered the period in the year 1912, when he was receiving the alleged salary at the rate of $12,000 per year. After the testimony upon the trial had been received and the arguments closed, counsel for respondent called the attention of the court to a bill of particulars covering the period in 1912, and requested that the jury be instructed as follows:

“A bill of particulars has been filed in this case. No claim is made in that bill of particulars of the embezzlement of the $25,000 salary. The people’s claim is limited to the salary of $12,000. The fact that respondent received the increase from $12,000 to $25,000 can be considered by you only as bearing upon the intent with which he received the $12,000.”

The court refused this request and noted thereon in writing the following reason:

“This request' is refused, because it was not presented until after the arguments were completed. The case was tried throughout and argued to the jury by defendant’s counsel on a contrary theory, and the attorneys representing the people claim a proper bill of particulars was served on defendant’s counsel.”

After a careful examination of the record we are satisfied that the court was right. The trial throughout was for embezzlement alleged to have taken place in the year 1913, and if the bill of particulars was intended to apply to this case respondent waived all right to rely upon it.

Previous to his indictment respondent had given testimony before the referee in bankruptcy upon an examination into the affairs of the Michigan Buggy Company. Against his objection that testimony was read to the jury in this case. This is assigned as error. The same question arose in People v. Lay, supra, and it was there held that such testimony was incompetent because of the immunity granted by the Federal statute. We see no reason for modifying the conclusion there reached, and the testimony should have been excluded. But in this case it is apparent that respondent could not have been prejudiced by its admission, inasmuch as he himself afterwards went upon the witness stand and substantially reiterated all that he had said before the referee. We have examined the testimony given by him in each instance, and are satisfied that he did this voluntarily, and not for the purpose of modifying or explaining anything that he had previously said. A party cannot complain that facts have been improperly proven when he himself voluntarily admits their truthfulness.

We now come to the most important question raised by this appeal. A “salary” is defined in Standard Dictionary as:

“A periodical allowance made as compensation to a person for his official or professional services or for his regular work.”

That we believe to be the accepted meaning of the term. Undoubtedly an officer of a corporation may receive an exorbitant salary without incurring criminal responsibility therefor, if it is authorized by competent authority, or received in good faith as compensation for services.

But in this case it is charged that respondent conspired with other directors and officers of the company, who had control of its property, to wrongfully and secretly convert its funds to their own personal uses; that in so doing they were not governed by the idea of compensation, and that they called the moneys so taken “salaries” only as a cover for their defalcations. If the charge is true, their conduct comes fairly within the terms of the statute under which they were indicted. That statute, so far as its provisions are here important, reads as follows:

“If any officer * * * of any * * * incorporated company * * * shall embezzle or fraudulently dispose of or convert to his own use * * * without consent of his employer or master, any money or other property of another, which shall have come to his possession, or shall be under his charge by virtue of such office or employment, he shall be deemed by so doing, to have committed the crime of larceny.” 5 How. Stat. (2d Ed.), § 14614; 3 Comp. Laws, § 11565, as amended by Act No. 102, Pub. Acts 1905, 3 Comp. Laws 1915, § 15310.

The taking of the money is conceded. There is no claim that it was authorized except by the alleged conspirators themselves. And if they intended to wrongfully convert the company’s money to their own uses, they had no authority, as directors or otherwise, to express the company’s consent thereto. Nor have we any doubt that the money converted was in their possession, and in the possession of each of them, within the meaning of the statute. They were directors of the company charged with the control of its property, and the checks of each, when drawn upon its funds, were honored without question. People v. Butts, 128 Mich. 208 (87 N. W. 224).

It is also admitted that the money was taken by an agreement between the parties named in the indictment ; and whether this agreement amounted to a conspiracy to take the money wrongfully and illegally depends upon the purpose and intention of the parties. As proof of this intent the prosecution introduced evidence tending to show that what are called increased salaries were never entered as such upon the books of the company; that Palmer drew the money with which they were paid from the local banks on checks drawn to “cash,” and that the money so drawn and used by him was charged to a fictitious account which appeared upon the books as an account receivable. It was also shown that when the money covered by this indictment was taken the company was insolvent in the sense that its capital stock had been impaired to the extent of several hundred thousand dollars. There was no direct evidence showing respondent’s knowledge of the method used in obtaining the money, or of the way in which it was entered upon the books, and the proof offered of these matters was duly objected to by his counsel. It was shown that respondent signed the company’s report for the year 1912, by which the impairment of its capital was admitted; but he denied any knowledge of the contents of the report, and any knowledge of the company’s insolvency. In relation to these matters, and to their admissibility as bearing upon respondent’s intent, the court instructed the jury as follows :

“Evidence has been introduced tending to show that the account of the money paid to the defendant was kept in two separate and distinct accounts, namely, the pay roll account and the account of J. Roach & Co. The only object for introducing the account of J. Roach & Co. is to show that the true account of the money paid the defendant was secreted, but you cannot consider that element in the case unless you shall find that that money was kept in the J. Roach & Co. account with the knowledge and consent of the defendant, or with the knowledge and consent of others with whom the defendant was knowingly co-operating in committing the offense with which he is charged. And so too of the matter of the insolvency of the company, if you find that to have been the condition at the time that arrangement was made for this increase in salary, that is not a circumstance which should be considered by you as indicating bad faith on the part of this defendant in accepting an increase in salary unless he knew of that unfortunate condition of the company at the time, or unless others with whom he was acting in concert to do this offense with which he is charged knew of the failing condition of the company.”

Respondent assigns error upon these instructions, as well as upon the admission of the evidence referred to, and insists that neither the method of raising the money and entering it upon the books nor the insolvency of the company were competent proof of his bad intent, because never shown to have been actually within his knowledge.

It is true that the proofs do not bring home to respondent any actual knowledge of the “J. Roach &, Co.” account, or that the increased salaries were charged to that account. And, if there had been no other proof of his bad faith, it is undoubtedly true that Palmer’s concealment of the salaries by means of that account could not have been used to show it. But there was other evidence of respondent’s bad faith, and enough to justify the court in receiving this evidence upon the theory that a conspiracy had been shown to embezzle the company’s money.

“Wherever two or more conspire together to commit an actionable wrong, everything said, done, or written by any one of them in the execution or furtherance of their common purpose is deemed to be so said, done, or written by every one and is a relevant fact as against each.” Hamilton v. Smith, 39 Mich. 222.

And see People v. Pitcher, 15 Mich. 397; People v. Saunders, 25 Mich. 119; People v. Arnold, 46 Mich. 268 (9 N. W. 406); People v. Salsbury, 134 Mich. 537 (96 N. W. 936); People v. McGarry, 136 Mich. 316 (99 N. W. 147). The evidence of Palmer’s method of raising the money with which to pay the alleged increase in salaries, and of the manner in which it was charged upon the books of the company, was properly received.

But the evidence as to the insolvency of the company is of a different character. It is true that respondent signed the annual report by which the impairment of its capital was shown, and the report was therefore admissible, but it was not conclusive as to his knowledge of the company’s condition. He says he never read the report, and did not know what it contained, and did not know of the company’s insolvency. This raised a question of fact for the jury. If they believed that he did know of its precarious condition, they had the right to take that knowledge into consideration in determining his purpose and intent in agreeing to the alleged increase for the others and in receiving the alleged increase to his own salary. But he could not be charged with the knowledge of the others. The court made the mistake of confounding what the others did in carrying out the conspiracy, if there was one, with what they knew when they went into it.

One conspirator is chargeable witk the acts of the others upon the principle that governs in case of agency, but that does not make him responsible for the antecedent knowledge of the others. It was not vital to the case that respondent’s knowledge of the company’s insolvency should have been established. The property of a solvent corporation may be embezzled, as well as the property of an insolvent one. But knowledge that the company was in a failing condition may have been considered by the jury as strong proof of respondent’s motive and intent, and we cannot know what their conclusion would have been if they had found such knowledge not possessed by nor imputable to him.

For this reason, the conviction is set aside, and a new trial ordered.

Stone, C. J., and Kuhn, Ostrander, Bird, Moore, Steere, and Brooke, JJ., concurred.