text:
    CITY OF YALE v. MICHIGAN FARMERS’ MUTUAL FIRE INSURANCE CO. OF ST. CLAIR AND SANILAC COUNTIES.
    1. Taxation — Assessment Roll — Validity—Regularity—Board of Review — Municipal Corporations.
    Under the provisions of 1 Comp. Laws, §§ 3854 and 3323 (1 How. Stat. [2d Ed.] g 1799, 2 How. Stat. [2d Ed.] § 5853),- that the omission of the indorsement of the clerk of the board of review upon the assessment roll should not affect the validity of the assessment, an assessment of a mutual fire insurance company, by the board of review, for a personal city tax, was not void because the clerk of the board failed to enter the required indorsement.
    2. Same — Exempted Property — Corporations.
    An assessment by a municipal board of review of a personal property tax against a mutual fire insurance corporation in part based upon advance premiums due from its members, which were its principal source of revenue, is valid. The fact that the defendant claimed to be indebted to its members for $23,104.47 unearned premiums would not entitle it to an exemption of that amount. The most that could be said is that the corporation held the fund in trust or as agent for its members. Funds so held are not exempt. 1 Comp. Laws, § 3837 (1 How. Stat. [2d.Ed.] § 1782).
    3. Same. — Agents—Assessments.
    The fact that the fund was not assessed to the defendant as agent or trustee would be unimportant and a mere irregularity.
    4. Same — Debts.
    Nor would the remote contingency that any large percent- ■ age of the members might seek to cancel their policies and ask for a return of the unearned premium make unearned premiums a liability or tona fide indebtedness within the meaning of the statute. The probability of future loss and payment therefor by defendant would not affect the amount of its taxable assets.
    Error to St. Clair; Law,' J.
    Submitted January 19, 1914.
    (Docket No. 64.)
    Decided March 26, 1914.
    Assumpsit by the city of Yale against the Michigan Farmers’ Mutual Fire Insurance Company of St. Clair and Sanilac counties for personal taxes. Judgment for plaintiff, and defendant brings error.
    Affirmed.

      Lincoln Avery and Walsh & Walsh, for appellant.

      Thomas Wellman, for appellee.
   Stone, J.

This is an action of assumpsit brought by the plaintiff, a municipal corporation, against the defendant, having its principal office for the transaction of business located in the city of Yale, to recover a personal city tax amounting to $210 assessed by the plaintiff against the defendant in May, 1912. The case, being at issue, was tried before the court without a jury. The defendant requested the court to make findings of fact and law. The findings of the court are as follows:

Findings of Fact.

“First. Plaintiff is a municipal corporation organized under Act No. 616 of the Local Acts of 1905. Section 3 of said local act provides that ‘the city of Yale shall in all things not herein otherwise provided, be governed and its powers and duties defined and limited by Act No. 215 of the Public Acts of Michigan of 1895 — which said act, as the same is now or hereafter may be amended, is hereby made and constituted a part of the charter of the city of Yale.’
“Defendant is a mutual fire insurance company organized under chapter 195 of the Compiled Laws of 1897.
“Second. This assessment was not made by the assessing officer of the plaintiff city, but was placed on the assessment roll by the board of review of the plaintiff city on the 27th day of May, 1912, at a regular meeting of said board. The assessing officer of the plaintiff city was Norman B. Herbert, who was also a member of the board of review, under section 5 of Act No. 215 of the Public Acts of 1895. Mr. Herbert was, and is, also the secretary of the defendant insurance company. At the time the assessment roll was offered and received in evidence, showing this assessment, the following occurred:
“By Plaintiff’s Attorney: I offer the assessment roll of the city of Yale for the year 1912. On page 26, the last item shows the assessment to the Michigan Farmers’ Mutual Fire Insurance Company, personal property assessed at $14,000, fixed by the board of review at $14,000; total same; contingent tax $140; highway tax $35; sinking fund tax $35; total city tax $210. This suit is brought just for the city tax alone. I understand the assessment and proceedings are conceded to be regular.
“Defendant’s Attorney: We raise no question about the regularity of the proceedings, but we do contest the right of the assessing officers to assess this company in the manner in which they did assess it; also we contest their right to make any assessment whatever.
“The Court: The plea is a plea of the general issue?
“Defendant’s Attorney: Yes; with notice. We raise no question about the regularity of the roll, aside from what the objections indicate.
“The assessment roll was then received in evidence, and no motion was made at that time, nor has been made since, to strike it ont. However, later in the day the following occurred:
“Defendant’s Attorney: With reference to our concession about the assessment and proceedings at the time of the presentation of this roll, we do not want to have counsel understand that we admit the regularity of the proceedings necessary to commence this suit. The proceedings prior to this roll is what we refer to as admitting the regularity of. But object to this roll for the reason that it is not signed by the clerk of the board of review, and the proof shows that this assessment was fixed by the board of review; whereas, this roll attempts to state that.the value as assessed by the supervisors, I take it to mean, was $14,000. The proof shows there was no assessment at all made by the supervisors, which is the fact, is it not, Mr. Weymouth?
“Mr. Weymouth, Plaintiff’s Attorney: There was no assessment made by the supervisors.
“Defendant’s Attorney: Now, there being no assessment by the supervisors, and there being no certificate by the board of review, we shall raise the point that there is no assessment here.
“The assessment roll in question appears to have a certificate attached in accordance with the provisions of section 6 of Act No. 215 of the Public Acts of 1895; but such certificate or statement was not signed by the clerk of the board of review.
“However, it appears in the testimony and by the assessment roll that on the 27th day of May, 1912, the following entry was made on page 26 of the assessment roll of the plaintiff city: ‘Michigan Farmers’ Mutual Fire Insurance Company, personal value as assessed $14,000, value as fixed by board of review $14,000.’
“The testimony shows that the board of review placed this assessment on the assessment roll as an assessment against the defendant company.
“Third. On or about the 1st of January, 1912, the defendant made its report to the commissioner of insurance for the State of Michigan. This report showed the following material facts:
Resources.
Iron safe ..................................$ 100 00
Mortgages .................................. 19,000 00
Premiums in course of collection........... 4,150 30
Casli on hand December 31, 1911............ 5,548 41
Total.................................$28,798 71
j “This report further shows that the defendant 'owned no real estate, and owed no debts.
“It was admitted upon the trial that the assessment of $14,000 was arrived at by reducing the above-named resources by one-half, and assessing the company at $14,000. The reason for doing this, as stated by the city attorney, who is a member of the board of review, was that it was the custom of the assessing officer of the city of Yale to assess property about 50 per cent, of its actual value, and that for this reason this company was assessed for about half of the total amount of its property, as shown by the report heretofore referred to.
“Fourth. At the time of making of the annual report for the year 1911 by the defendant an item of $19,000 mortgages appears as a part of the assets of the defendant company. Between that time and the time of making the assessment in question, Mr. Herbert, the defendant’s secretary, had paid a specific tax under the mortgage tax law on $9,700 of the defendant’s mortgages. This $9,700 on which the mortgage tax had thus been paid consisted of $2,000 of the $19,000 of mortgages contained in the report heretofore referred to, together with moneys belonging to the company which had been invested in mortgages since January 1, 1912, to the amount of $7,700. Thus the defendant had invested in mortgages on May 27, 1912, at the time the contested assessment was made by the board of review, upon which no specific mortgage tax had been paid, the sum of $17,000.
“Fifth. Defendant’s fifth request for findings of fact is covered so far as the evidence warrants, and so far as is material and necessary by the former findings filed May 31, 1913.”
That request is as follows:
{“Fifth. The method of doing business by this company is that an applicant for membership is required to pay an advance assessment. The board of directors made an estimate of what amount of money would be required to meet the demands of the company, and fixed, by resolution, the advanced assessment for three years. If this, together with the moneys on hand, is sufficient to pay the losses of the company, then the members need pay no further assessments; but if this is not sufficient, then they are liable to such further assessments as may be necessary to pay the obligations of the company. The board of directors fixed two separate rates of advanced assessments; the more hazardous risks paying the larger amount. It appears that at the time of the making of this assessment the company had received from members who held policies of insurance that were then in force the sum of $23,104.47, which at that time had not been earned. This is termed "Return Assessments’ or "Return Premiums.’ If for any reason it become necessary to refund to the membership their pro rata of the advanced assessments paid by them, the company would have had to refund this amount of money.”)
“Sixth. The defendant company had no source of revenue, other than the assessment of the members. The average losses of the company each year, talcing one year with another, was approximately $8,000, and the cost of operating the company was approximately $1,200. The defendant company had accumulated, under its plan of collecting advance premiums, the money in bank and the moneys represented by the mortgages. This fund was kept on hand for the payment of losses and expenses of the company, and for return premiums to members, when called upon to make them. There was no personal gain for any one in the management of the company, except that the-officers were paid a compensation for the work they did.
“Seventh. Defendant’s seventh request for finding of fact is refused.”

It was as follows:

{“Seventh. If, at the time this assessment was made, the unearned advance assessments above mentioned, amounting to $23,104.47, were deducted from the total resources of the company, the company would have no assets liable to taxation.”)
“Eighth. The item appearing in the report of the company heretofore given, showing the resources of the company, under the head of ‘Premiums in Course of Collection,’ represents premiums not paid in; that is, there was that amount of premiums which had not been collected. Under the practice of this company some of the premiums were paid in cash and some in notes.
“Ninth. Suitable demand was made by the treasurer of the plaintiff city, and an endeavor to collect the tax was made; but the tax was not paid, and was duly returned. The council of the city of Yale duly authorized the commencement of this suit.”

Findings op Law.

“First. The omission of the clerk of the board of review to sign the certificate or statement added to the assessment roll, as provided by section 6 of Act 215 of the Public Acts of 1895, does not invalidate such assessment roll, for the reason that said statute, among other things, provides: ‘The omission of such indorsement, however, shall not affect the validity of such roll.’ The indorsement referred to in the part of the statute just quoted is the statement or indorsement which was attached to this roll, but not signed by the clerk of the board of review. Hence it follows that the assessment of defendant company placed on the roll by the board of review on May 27, 1912, is a valid assessment.
“Second. Defendant’s second request for finding of law is fully governed by the findings filed on May 31, 1913.
“Third. Defendant’s third request for findings of law is fully covered by findings filed by this court on May 81, 1913.”

These requests were as follows:

{“Second. The defendant company owes to its members, on account of assessments which have been paid in advance, the sum of $23,104.47. This amount should be deducted from the assets of the company. After doing this, there is nothing left upon which to base an assessment against the defendant company, and therefore I find and direct that a judgment be entered in favor of the defendant.”)
{“Third. The law does not provide for the assessment of assets of the mutual fire insurance companies, and therefore this company is not liable to assessment. Therefore it is ordered that a judgment should be entered in favor of the defendant.”)
“Fourth. Defendant’s fourth request for findings of law is hereby refused, for the reason that the re-. port of the commissioner of insurance therein referred to furnished sufficient basis for its assessment.”

That request was as follows:

{“Fourth. The commissioner of insurance did not determine and show by his last report the net assets, above liabilities, in accordance with the statute governing insurance companies, if such statute governs mutual fire insurance companies, and therefore there was no basis for making this assessment, and it is ordered that judgment be entered in favor of the defendant.”)
“Hence it follows that plaintiff is entitled to a judgment of $210, and interest on the same at 5 per cent, per annum, computed from the latest date on which defendant was entitled to pay this tax without interest, to the treasurer of the city of Yale,'together with its cost.”

Judgment was thereupon entered for the plaintiff for the amount claimed.

It appears that an informal finding had been, filed by the court on May 31, 1913. The finding, however, which we have copied was the final finding upon request of defendant’s counsel, and made before judgment entered. As already appears, defendant’s counsel had filed a proposed finding, some parts of which have been copied by us and embraced in parentheses. Exceptions were duly filed by the defendant to the refusal of the court to find as requested, both upon the law and the facts, and also to the findings and conclusions of law made by the court, all of which have been covered by proper assignments of error.

An examination of the record satisfies us that the findings of fact by the court and the conclusions of law were fully supported and sustained by the evidence.

As we understand the position of defendant and appellant, it is :

(1) That there was no valid assessment against the defendant company.
(2) That defendant was indebted to its members for $23,104.47, as unearned premiums, which left nothing to assess.
(3) That advance premiums of mutual fire insurance companies are not subject to assessment.
(4) That the insurance commissioner did not determine, as shown by his report issued in 1912, the net assets, above liabilities, of defendant company, and therefore there was no basis for this assessment.

1. The point urged that there was no valid assessment against the company may be said to cover more than the mere question of the regularity of the assessment. Upon the subject of the regularity of the assessment, it is only necessary to refer to section 6, chap. 31, Act No. 215 of the Public Acts of 1895 (2 How. Stat. [2d Ed.] §5853), which provides that “the omission of such indorsement, however, shall not affect the validity of any such roll.” The same provision is found in the general tax lav/ (1 Comp. Laws, §3854, 1 How. Stat. [2d Ed.] §1799), which reads as follows:

“Upon the completion of said roll and its indorsement in manner aforesaid, the same shall be conclusively presumed by all courts and tribunals to be valid, and shall not be set aside except for causes hereinafter mentioned. The omission of such indorsement shall not affect the validity of such roll.”

The argument is made that, if the assessment had been made by the assessing officers, it would have had their signatures, or certificate, to show that it had been made; then the absence of the signature of the board of review would not invalidate the roll.

Counsel have evidently overlooked the fact that supervisors’ or assessors’ certificates to assessment rolls have not been required since the revision of the tax law of 1882. This provision was omitted from the tax law of that year, and has never been re-enacted. See note to section 3850, 1 Comp. Laws (1 How. Stat. [2d Ed.] § 1795). We are of opinion that there is no force in this objection.

2. The other objections may be considered together, and they present the meritorious question in the case.

By section 3824, 1 Comp. Laws (1 How. Stat. [2d Ed.] §1769), it is provided “that all property, real and personal, within the jurisdiction of this State, not expressly exempted, shall be subject to taxation.”

Attention is called to section 3831, 1 Comp. Laws (1 How. Stat. [2d Ed.] § 1776), defining the personal property that is subject to taxation.

Section 3834, 1 Comp. Laws, as amended (Pub. Acts 1903, Act No. 235; 1 How. Stat. [2d Ed.] §1779), provides as follows:

“All corporate property, except where some other provision is made by law, shall be assessed to the corporation as to a natural person, in the name of the corporation. The place where its office is located in its articles of incorporation shall be deemed its residence. * * * In computing the taxable property of insurance companies organized under the laws of this State, the value of the real property on which a company pays taxes shall be deducted from its net assets above liabilities, as determined and shown by the last report of the commissioner of insurance, including in such liabilities the legal reserve required by the laws of this State, or the regulations of the insurance department, and the remainder shall be the personal property for which the company shall be assessed.”

That the defendant has no real property is found as a fact in this case. The statute under which the defendant is organized does not contemplate or provide for any “legal reserve.” Such “reserve” is not within the purview .of the statute. The term is a misnomer when applied to such companies. The report of the insurance commissioner upon which the assess.ment complained of is based shows total available resources of $28,798.71, and no liabilities. This is identical with the report filed by the defendant. This would seem to be a sufficient determination by the commissioner of insurance, as shown by the report, in evidence, if any such determination was required. It thus appears that the assessment complained of is lower in amount than that determined as assessable by the insurance commissioner, and appearing in the report of the defendant.

It is not necessary for us to here decide whether or not the defendant is authorized to collect, in advance, assessments from its members. It is not denied that it has done so.

As we understand the claim of the defendant, it is that this fund really belongs to its members who hold policies, and has been contributed by those members in advance of assessments. Can it be said that these moneys now held by the defendant shall be exempt from taxation, because they are held by the defendant as trustee or agent of those members as a fund accumulated which evidently is intended to pay such assessments as may be found necessary from time to time? The most that can be said is that the defendant holds this fund as a trustee or agent for its members. We are not aware of any statute which would exempt such fund from taxation.

By subdivision 6 of section 3837, 3 Comp. Laws (1 How. Stat. [2d Ed.] § 1782), it is provided as follows:

“Personal property under the control of a trustee or agent, whether a corporation or a natural person, may be assessed to such trustee or agent in the township where he resides, except as otherwise provided.”

The mere fact that it is not assessed to the corporation as a trustee or agent would be a mere irregularity, and is unimportant under our statute, and the rulings of this court. Section 3922, 1 Comp. Laws (1 How. Stat. [2d Ed.] § 1870); Iron Star Co. v. Wehse, 117 Mich. 487 (76 N. W. 66).

In the first finding of the circuit judge, in the form of an opinion, we find the following language, which we approve:

‘Does the possibility that part or all of the members of this mutual insurance company will seek a cancellation of their policies, and demand a return of the unearned premium which they have paid, or for which they have given their promissory notes, render such unearned premium a liability or a bona fide debt which defendant is entitled to have subtracted from its resources in an estimation of its taxable property?
“Defendant’s statement shows that on December 31, 1911, it had 2,760 members. So far as the evidence in this case shows, defendant is a well-managed and prosperous mutual insurance company doing a good business within a limited territory, at a very moderate premium, and with a very low expense account. It was authorized to do business in 1895, as shown by its charter. The possibility that all or any large percentage of its members will seek to surrender their policies and ask for a return of unearned premium is such a remote and improbable contingency as to be hardly worthy of consideration. This contingency did not deprive the moneys, promissory notes, or mortgages representing the unearned premium of $23,104.47 of their character as personal property, nor did it make this unearned premium a ‘liability’ or a ‘bona fide indebtedness’ within the meaning of any statute relating to the assessment of personal property. Neither does the probability of future losses of insured property, for which defendant will have to pay under its contracts, change the character of this unearned premium fund from an asset to a liability, or debt, with reference to the law of taxation. To hold that either contingency deprived defendant of all taxable assets would not be in accord with sound reason, and would be against all precedents I can find. Home Fire Ins. Co. v. Lynch, 19 Utah, 189 (56 Pac. 681); People v. Davenport, 91 N. Y. 574; Insurance Co. v. Cappellar, 38 Ohio St. 560; State v. Board of Assessors, 47 La. Ann. 1498 (18 South. 462).”

We also call attention to the language of Chief Justice Hooker in Detroit Fire & Marine Ins. Co. v. Hartz, 132 Mich. 518 (94 N. W. 7), which seems to be very much in point upon this question of remote contingent liability.

Counsel for defendant have called attention to the case of Michigan Mutual Life Ins. Co. v. Detroit Common Council, 133 Mich. 408 (95 N. W. 1131). That case had to do with the reserve fund of a life insurance company, and presented a different question from the one we are here considering, and in no way conflicts with the authorities above cited.

The judgment of the circuit court is affirmed.

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


source: Caselaw Access Project

author: Stone, J.

license: Public Domain

text:
    DETROIT POSTAGE STAMP SERVICE CO. v. SCHERMACK.
    1. Novation — Assignment—Saces.
    Upon testimony, not in dispute, that the defendants contracted to grant to an individual an exclusive selling agency for its stamp-vending machines in his city, that he assigned his rights to a corporation afterwards formed, and that one of the defendant firm suggested to him the arrangement which he thus made to finance the enterprise and that the assignee proceeded to attempt performance of the contract, sending its checks signed by the original licensee as president, and defendant was not shown to have consented to release the original party to thé contract, the trial court correctly held there was no evidence of a novation and no consent could be implied as against the defendants.
    2. Same — Mutuality—Contracts.
    And there was no mutuality of obligation between the parties.
    3. Same — Assignability of Contract — Agency.
    Such a contract was unassignable, being of a personal nature and creating a relation of confidence.
    4. Same — Construction—-Exchange.
    Where it was provided in the agreement that the agent might exchange the machines purchased for a new type of vending machine, and receive credit for the price paid, on paying the difference in price in cash, an attempted exchange without payment of the cash difference was insufficient to support an action on the contract.
    Error to Wayne; Mandell, J.
    Submitted January 27, 1914.
    (Docket No. 120.)
    Decided March 26, 1914.
    Assumpsit by the Detroit Postage Stamp Service Company against Joseph J. Schermack and another for the recovery of the price paid for certain vending machines. Judgment for defendants upon a directed verdict. Plaintiff brings error.
    Affirmed.

      Leon D. Barlow (Walter Barlow, of counsel), for appellant.

      Jonathan Palmer, Jr., for appellees.
   Stone, J.

This is an action of assumpsit to recover $562.50, and interest, claimed to be due the plaintiff, as representing the amount paid to defendant by the plaintiff for 37 stamp-selling machines; the defendant having failed to deliver to plaintiff 16 new twin type machines, to which the plaintiff claimed it was entitled, in exchange for the 37 machines first mentioned, under the following contract, known as Exhibit A. On October 7, 1910, the defendants entered into a contract with Arthur F. Mercer:

“The Schermack Company,
“Mailing Room Specialists,
“72 State Street, Detroit.
“October 7, 1910.
“Mr. Arthur F. Mercer, City—
“Dear Mr. Mercer:
“Since you desire the exclusive rights of operating and selling our stamp-selling machines in this city:
“We hereby give you this exclusive privilege, providing you purchase machines from us at the following prices and terms: 25 machines of the type we now have in operation to be purchased at once for cash at $15 each; 25 machines of the same type to be purchased by Oct. 22 at $15 each, $7.50 each to be paid on delivery, and the balance of $7.50 each in 90 days; 10 machines to be purchased by Nov. 1, of the new exposed mechanism twin type using the hyphen hole perforated stamps, price of these machines to be $35, one-half of which is to be paid on delivery, and the balance in 90 days; 40 machines similar to the first 25 mentioned to be purchased by Dec. 1 for $15 each, one-half to be paid on delivery, and the balance in 90 days.
“All additional machines of the type similar to the 90 before mentioned, that is, using the specially perforated stamps, and vending the one denomination only, will be supplied for $15 cash, and all other styles and types of stamp venders will be furnished to you at our regular general agents’ price, which will be fully 25% less than the regular retail price.
“At any time after six months from date you will have the privilege of exchanging machines of the old type for the new exposed mechanism twins by paying the difference in price in cash.
“We agree to the above, providing you do not operate, make, or sell any stamp venders other than those we furnish.
“We further agree to defend and save you harmless and indemnify you against any and all claims which may be made against you on account of alleged infringement of patent rights or alleged confliction with Federal laws and expenses of any kind connected therewith arising from the use of the machines.
“Should you fail to make the payments on machines as 'called for above, the payments already made, if any, will apply as payments in full on as many machines as such money will purchase at the rate of $15 per machine on single machines and $35 each on twins. You of course will have the privilege of operating any machine purchased from us and fully paid for.
“We further agree to guarantee these machines against all mechanical defects and imperfections for the period of one year.
“We further agree to furnish free of charge a suitable stamp-perforating device when the one hundred machines have been purchased.
“Yours truly,
“The Schermack Company,
“Jos. J. Schermack.
“Accepted: Arthur F. Mercer.”
On October 11, 1910, said Arthur F. Mercer made the following assignment of the above contract, which assignment was indorsed on the back of said contract, and is known as Exhibit B:
“Detroit, Mich., Oct. 11, 1910.
“In consideration of the issuing to me of five hundred shares of the capital stock of the Detroit Postage Stamp Service Co. in accordance with the resolution of the board of directors adopted Sept. 30, 1910, which said shares are to be issued to me in equal amount to the number of shares issued from time to time in the aggregate to the several other stockholders until said five hundred shares of stock have been fully issued to me, I hereby sell, assign, transfer, and set oyer to the Detroit Postage Stamp Service Co. all my right, title, and interest in and to the within instrument.
“Arthur F. Mercer.
“Witness: Walter Barlow.”

Upon the trial the above instruments were received in evidence over the objection and exception of defendants that the same were incompetent, irrelevant, and immaterial, and showed no privity between the parties to this suit.

It appeared upon the trial that at the time of the making of the' contract on October 7, 1910, the plaintiff company had not been incorporated; that the defendants knew of the subsequent organization of the plaintiff company, Mr. Mercer, its president, testifying:

• “Mr. Joseph J. Schermack was the one who put the idea into my head, and told me how to go ahead to work it up in order that I might raise capital to buy the machines from his company. The purpose of organizing the Detroit Postage Stamp Service Company was, through the understanding with Mr. Jos. J. Schermack, himself and myself, for the purpose of raising capital by which these machines could be purchased from the Schermack Company. * * * These machines were turned over by the Schermack Company to the Detroit Postage Service Company to operate under the plan that I personally had arranged with the Schermack Company to carry out. * * * I'was the .president of the Detroit Postage Stamp Service Company, and attended to all of those machines myself personally. I visited the places where the machines were located just as often as it was necessary to take out the money which had been paid into them, and to refill the machines with stamps. There were more machines added to the 25 machines that were turned over by the Schermack Company to the Detroit Postage Stamp Service Company. I put out 37 machines in all. They were all the same kind of machines, the same type. We got the additional 12 machines from the Schermack Company after the organization of the Detroit Postage Stamp Service Company. I had all of those machines under my own observation, all the time during the fall and winter of 1910 and the winter and spring of 1911. * * * The stock issued for this agreement I paid nothing for, only the assignment of the agreement. There was no other agreement between me personally and the defendant copartnership, the Schermack Company, than this paper offered in evidence. ■ There was no other agreement covering the purchase of these stamp machines from the Schermack Company other than this paper, Exhibit A, and the assignment on the back, Exhibit B, between our corporation and the defendants. There was no other agreement then or at any time by the terms of which the plaintiff assumed my obligation and my contract to pay them anything. I never got the consent in writing of the Schermack Company to make this assignment.. Exhibit B was never consented to in writing by the defendants at any time. I did not at any time give them notice in writing that I intended to assign or had assigned my contract to the Detroit Postage Stamp Service Company. The plaintiff company did not pay anything to the Schermack Company for the assignment of this contract. There was no consideration whatever between them, the plaintiff and defendants.”

Referring to the checks given by the plaintiff to the defendants for machines, and speaking particularly of the check of $375, dated October 12, 1910, Mr. Mercer testified:

“That was the Detroit Postage Stamp Service Company’s money. My contract at that time had been turned over to the Detroit Postage Stamp Service Company. That check was given to fulfill the first payment under my contract, and was for the first 25 machines at $15 a machine. * * * It was the same with the next check, Exhibit F, payable to the order of the Schermack Company, for $187.50; that was for the next payment under this paper dated October 7, 1910, which was for half of the next installment of machines. The terms of the contract was one-half to be paid in cash, and one-half in 90 days, and so half when we took the machines was $187.50. I paid.that by the Detroit Postage .Stamp Service Company’s check over my signature as president.”

Receipts were given for these checks; but we find no evidence that the machines were billed to the plaintiff by the defendants, as claimed by the plaintiff. The only correspondence in the record relating to the business was a letter of the defendants, dated February 7, 1911, to Mr. Mercer personally.

Referring to the claim of the plaintiff in this suit, Mr. Mercer testified that nothing beyond the $562.50 was paid; that no part of the other payments was ever made; that he returned the machines to the defendant, and demanded the twin type of machine in exchange. He testified on cross-examination:

“I returned the machines to the Schermack Company, and demanded the twin type of machines in exchange, and figured out the number of the new machines at the agreed price to equal the amount we had paid for the old ones, less $2.50, as I explained before. The $2.50 difference was coming from the Schermack Company to the Detroit Postage Stamp Service Company. I did not offer to pay any cash difference in exchange of machines. We wanted new machines of the twin type mechanism in exchange for the type which we first bought. We did not at any time during our negotiations offer to pay cash difference in price between the $35 price of the new machines and the $15 price for the old ones. That is $20 difference. I recollect the portion of the contract which says that at any time after six months from date I might have the privilege of exchanging the old machines for new ones of the new exposed mechanism twin type by paying the difference in price in cash. That was in the contract. We did not offer that difference in cash at any time.
“Q. Yet you expected to get twin type machines for the single machines, fixing the number, to make the equal value without any cash difference?
“A. According to the clause of the contract. There is another clause in the contract.
“Q. Where is that? Show me.
“A. There it is, right there.
“Q. 'Should you fail to make payments on machines as called for above, the payments already made, if any, will apply as payments in full on as many machines as such money will purchase at the rate of $15 per machine on single machines, and $35 each on twins. You of course will have the privilege of operating any machines purchased from us and fully paid for.’ Where does that give the right of exchange without paying the difference in cash? That gives you the privilege of keeping the machines you paid for.
“A. Or exchanging them (quoting the contract).
“Q. How many twin type machines had you bought? I mean twin machines as distinguished from single machines? How many single machines had you bought, or how many twins or double machines had you purchased up to that time?
“A. We had paid them in money equivalent to 37 single or 16 twin machines, and up to that time we had purchased the first 25 single machines, and paid for them by this $375 check. We next took 12 more under our next allotment of 25 more single machines, making 37 single machines we bought and paid for. We had no double machines. The 37 machines that we originally bought under this installment were bought and paid for. When we demanded exchange of machines we asked the Schermack Company to exchange the single machines for the double machines, without paying the cash difference.”

The defendants not having delivered the 16 new machines in exchange as demanded by the plaintiff, this suit was brought to recover for the money paid under the contract. At the close of plaintiff’s case the defendants moved for a directed verdict in their favor, upon the following grounds:

First. Because there was no privity of contract shown between the plaintiff and the defendants.
Second. Because in the assignment there was no agreement by the plaintiff to assume the liabilities of Mr. Mercer, and consequently no mutuality of obligation or contract existing between the plaintiff and the defendants.
Third. Because- the alleged assignment by Mr. Mercer to the plaintiff company was made without consent in writing of the defendants, and was without consideration as between the plaintiff and the defendants.
Fourth. Because by the terms of the alleged assignment the plaintiff had the privilege of buying machines from the defendants, but did not assume nor have any of the liability of Arthur F. Mercer, under his contract with the defendants, and therefore, as between the plaintiff and the defendants, it became a one-sided and what is known in law as a unilateral contract, which cannot be enforced by the plaintiff, because the declaration fails to allege any promise by the defendants to the plaintiff, and the proofs fail to show any promise between the plaintiff and the defendants.
Fifth. Because the plaintiff has failed to make out a case under the pleadings.

The motion of defendants was granted, and the trial court directed a verdict fór the defendants, upon the grounds, as we understand it, that the contract with Mr. Mercer was a personal contract, and not assignable, without the consent of the defendants, and that the evidence did not show a novation. A judgment for the defendants followed, and the plaintiff has brought the case here for review, and by its assignments of error claims that the trial court erred in directing a verdict for the defendants, and in not submitting the case to the jury.

1. It is the claim of the appellant that by the evidence the plaintiff clearly established a novation by the substitution of the plaintiff for Mr. Mercer. It will be noted that there was no conflict in the evidence here, and the question is whether, under the undisputed evidence, a novation was shown. We recognize the rule to be as stated by the plaintiff.

“It is not essential that the assent to the acceptance of the terms of novation be shown by express words to that effect; but the same may be implied from the facts and circumstances attending the transaction, and the conduct of the parties thereafter.” 29 Cyc. p. 1132.

But the following should be added:

“Such, consent is not to be implied merely from the performance of the contract by the substitute, for that might well consist with the continued liability of the original party; the substitute acting for that purpose in the capacity of agent for the original obligor.”

This subject was discussed in the recent case of Harrington-Wiard Co. v. Manufacturing Co., 166 Mich. 276, 286, 289 (131 N. W. 559), and what was there said is applicable here.

We find no evidence that the defendants ever agreed to substitute the plaintiff for Mr. Mercer, or that it ever released the latter from his contract. In fact, all of the dealings of the defendants were really with Mr. Mercer personally. It is true that he used the' checks of the plaintiff to pay his obligations; but that was just as consistent with his continued liability as it was with a novation of parties.

2. Under the doctrine of this court, as stated in numerous cases, the situation between the plaintiff and defendants lacked mutuality of obligation or contract. Wilkinson v. Heavenrich, 58 Mich. 574 (26 N. W. 139, 55 Am. Rep. 708); Davie v. Mining Co., 93 Mich. 491, 496 (53 N. W. 625, 24 L. R. A. 357); Jackson v. Sessions, 109 Mich. 216 (67 N. W. 315); Hollingshead v. Morris, 172 Mich. 126 (137 N. W. 527, 41 L. R. A. [N. S.] 310); Richardson v. Hardwick, 106 U. S. 252 (1 Sup. Ct. 213).

3. There is much force in the position of the defendants that the contract between Mr. Mercer and the defendants was a personal one, and not assignable, without defendants’ consent. The rule is stated by Justice Gray, in Delaware County Com’rs v. Safe & Lock Co., 133 U. S. 473 (10 Sup. Ct. 399), as follows :

“When rights arising out of contract are coupled with obligations to be performed by the contractor, and involve such a relation of personal confidence that it must have been intended that the rights should be exercised and the obligations performed by him alone, the contract, including both his rights and his obligations, cannot be assigned without the consent of the other party to the original contract.”

See, also, Arkansas Valley Smelting Co. v. Mining Co., 127 U. S. 379 (8 Sup. Ct. 1308).

The last-cited case was commented on by this court in Northwestern Cooperage, etc., Co. v. Byers, 133 Mich. 534 (95 N. W. 529). The instant case would seem to fall within the rule stated in the Arkansas Valley Smelting Co. Case. See, also, City of Marquette v. Wilkinson, 119 Mich. 413 (78 N. W. 474, 43 L. R. A. 840); Edison v. Babka, 111 Mich. 235 (69 N. W. 499); Atlantic, etc., R. Co. v. Railroad Co., 147 N. C. 368 (61 S. E. 185, 15 Am. & Eng. Ann. Cas. 363), and note at page 370; 4 Cyc. pp. 22, 23, and cases cited; 2 Am. & Eng. Enc. Law (2d Ed), p. 1035, and cases cited.

4. An insuperable objection to a recovery in this case is that, if no assignment of the contract had been made, Mr. Mercer himself could not lawfully demand the delivery of the new machines in exchange for the old ones without paying the difference in cash, and certainly the plaintiff’s rights could be no greater than Mr. Mercer’s under the contract. This exchange was attempted without paying the cash difference. So, in any view of the case, the result reached by the trial court was correct.

The judgment of the circuit court is affirmed.

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


text:
    WALLACE v. GRAND TRUNK WESTERN RAILWAY CO.
    Estates of Decedents — Railroads—Death—Executors and Administrators — Husband and Wife.
    Notwithstanding the instantaneous death of plaintiff’s intestate, a recovery of the value of her services was correctly permitted for her death by negligent act of the defendant, for the benefit of her surviving husband.
    Error to Shiawassee; Miner, J.
    Submitted January 14, 1914.
    (Docket No. 78.)
    Decided March 26, 1914.
    Case by Henry W. Wallace, administrator of the estate of Ella D. Cole, deceased, against the Grand Trunk Western Railway Company for the negligent killing and wrongful death of decedent. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Harrison Geer, for appellant.

      George E. Pardee and Roy M. Choueh, for appellee.
   Stone, J.

This suit was brought to recover damages under the “death act,” so called, for the alleged negligent killing of Ella D. Cole, a married woman, 61 years of age, by the defendant at the intersection of Main street, which runs north and south, and defendant’s tracks, which extended east and west, in the village of Perry, on the evening of October 23, 1912.

Decedent, with her husband, Frank H. Cole, and a stepdaughter, Ella Cole, resided in the northeastern part of the village, north of the said tracks. Decedent and her said, stepdaughter had occasion, on the evening aforesaid, to go into the village south of the tracks, and while walking along the easterly side of Main street, they attempted to cross the track, or siding. It is the claim of plaintiff that some freight cars, which stood upon the siding and east of the street, were suddenly and without warning, moved by a switching crew of the defendant in a westerly direction, and that decedent was knocked down by said cars, run over, and instantly killed. Decedent left surviving her a husband and two adult children by a former marriage.

The case was submitted to a jury by the trial court, and the trial resulted in a verdict and judgment for the plaintiff. The defendant has brought the case here upon writ of error; and by the assignments of error but a single question is presented. We quote from the defendant’s brief as follows:

“There is no dispute in this case but that there was a question of fact for the jury, both as to the negligence of defendant and the contributory negligence of decedent. * * * We rely in this brief upon the proposition that, decedent having been instantly killed, the administrator of her estate cannot recover for the benefit of Frank H. Cole, husband of decedent, the value of her services, which belonged to the husband; since the death act, so called, does not change the rule of common law, with respect to the services of a wife, which belonged to the husband.”

Under the evidence the husband is a beneficiary of the deceased and entitled to participate in the personal estate.

This identical question has been discussed and decided by us in the recent case of Lincoln v. Railway Co., ante, 189 (146 N. W. 405), and the opinion in that case governs and rules the instant case.

The judgment of the circuit court is affirmed.

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


text:
    LOBENSTEIN v. WHITEHEAD & KALES IRON CO.
    1. Master and Servant — Municipal Corporations — Ordinances —Negligence—Duty to Protect Openings.
    An ordinance of the city of Detroit requiring owners, contractors, and builders having charge of constructing buildings more than 30 feet high to provide temporary flooring and to protect or guard any openings, had no application to a room more than 30 feet high on the roof of which defendant was constructing a smokestack, not being engaged in constructing or modeling the building.
    2. Same — Dangerous Place — Personal Injuries.
    Where an inexperienced servant is put to work in a dangerous place or- at dangerous labor outside the scope of his employment, his employer is liable for an injury resulting from exposure to those unusual risks which are not understood or appreciated by the servant, or are not apparent, or can only be learned by experience in doing the work. Unless the master warns, instructs, and informs the servant as to all the dangers incident to the work, which are not discoverable from ordinary observation by an inexperienced person who would have no reason to anticipate danger, the master is liable for injuries resulting from the servant’s lack of knowledge, from failure to instruct him. The master is liable for injuries resulting from negligence in exposing the servant to risks which the latter is incapable of appreciating.
    3. Same — Dangers—Warning and Instructing Servant.
    It is the duty of the employer to warn his servant of unusual dangers which he may encounter in his changed work, not to infer that the servant knows of them.

    4. Appeal and Error — Directed Verdict — Trial.
    Plaintiff is entitled to have his evidence considered in the light most favorable to him, on error to review a verdict directed against him.
    5. Same — Negligence—Assumption of Risk.
    Where the defendant sent its employee to construct a platform around a flue opening left about 85 feet from tbe ground, without informing him concerning the dangers of the work to be done by the servant, who was inexperienced at that kind of labor, which also was not within the scope of his employment, the trial court erred in directing a verdict for the defendant on the ground that defendant was not negligent or that plaintiff assumed the risk.

    6. Same — Contributory Negligence.

      Held, also, that it could not be determined as- a matter of law that plaintiff was guilty of contributory negligence, or that the negligence, if any, was that of a fellow-servant.
    7. Same — Notice or Knowledge.
    A servant assumes only those risks which are incidental to his usual employment and those of which he had knowledge or should have known.
    8. Same — Actions—Death Act — Survival—Estates of Decedents.
    Where there was an injury which resulted in death within a few minutes, the action might properly be brought •under the death act, by the administrator of the decedent.
    Error to Wayne; Hosmer, J.
    Submitted January 7, 1914.
    (Docket No. 4.)
    Decided March 26, 1914.
    Rehearing denied June 4, 1914.
    Case by William Lobenstein as administrator of the estate of George Stierle, deceased, against the Whitehead & Kales Iron Company for the negligent killing of decedent. Judgment for defendant upon a directed verdict. Plaintiff brings error.
    Reversed.

      William Look and Duncan C. Beath (II. F. Chip-man, of counsel), for appellant.

      Luman W. Goodenough and Irvin Long, for appellee.

       As to the master’s duty to warn or instruct servant, generally, see note in 44 L. R. A. 33.

       On the Question when risks of work outside scope of employment are deemed to be assumed, see note in 48 L. R. A. 803.

   Stone, J.

This action was brought under the “Death Act” to recover pecuniary damages for the alleged wrongful death of George Stierle, who was killed by falling 85 feet, while working for the defendant on the Edison Illuminating Company’s building in the city of Detroit, where defendant had been erecting a smokestack.

The declaration alleges: That certain openings in the construction of the building had been left for stairways, elevator openings, flues, and openings in which to fit and place certain chimneys; that on September 13, 1909, defendant was engaged in erecting a scaffold or platform 85 feet above the ground, upon which its servants were to stand at the work of riveting together certain steel beams or joists at the base of one of the chimneys, and that plaintiff’s intestate was sent to work upon such scaffold; that the plaintiff’s intestate was hired by the defendant to run the hoisting engine, and was ignorant, unskilled, inexperienced, and uninstructed about the dangers and hazards of this extrahazardous employment. It is the claim that the riveting above alluded to was highly dangerous and extrahazardous, and required skilled and experienced workmen, and could not be done by unskilled, inexperienced, and ignorant laborers, such as plaintiff’s intestate; that the defendant, on the 13th day of September, 1909, carelessly, negligently, and with knowledge of these facts, ordered and directed plaintiff’s intestate to construct the scaffolding or platform around or near a certain opening or flue left in the construction of the building, for the purpose of erecting or placing a certain chimney through and upon the building at a point 85 feet above the ground, which work of constructing the scaffold plaintiff’s intestate undertook to do and perform; that the defendant, well knowing of the employment of plaintiff’s intestate, and of his ignorance, unskillfulness, and inexperience, negligently failed to inform him of the dangers and hazards of the new and extrahazardous work, and fáiled to provide plaintiff’s intestate with reasonably safe means and appliances to enable him to work as safely as the hazards incident to the employment permitted. It also averred that defendant negligently failed to provide suitable and safe means and a suitable and safe place for doing the work in which plaintiff’s intestate was engaged. By an amended declaration the plaintiff also counted upon an ordinance of the city of Detroit entitled “Protection of persons engaged in the construction of buildings.”

The plaintiff’s intestate left surviving him a widow and two minor children.

The only testimony relating to the circumstances surrounding the injury was that of Joseph Darge, a witness produced for the plaintiff, who testified that at the time in question he was working for defendant as foreman; that plaintiff’s decedent commenced working for the defendant in March, 1909. This witness testified, among other things, as follows:

“Q. What was the employment of Mr. Stierle?
“A. He was hired to hoist — to run the hoisting engine, and that was what he was doing. I did not hire him; the superintendent of the Whitehead-Kales Company hired him, and sent him over there. I was his foreman. He ran the hoisting engine; that is all he did. And after he got done hoisting, and then Stecher gave me orders to take Stierle away from the engine, and rig up a scaffold for four rivets to drive on the girder. I was running the job; that means they have got to do the way I tell them, and I have to do the way the superintendent told me. His name was William Stecher. Stecher gave me certain orders, and I delivered those orders to the men.
“Q. Was George Stierle a steelworker there?
“A. No.
“Q. Just what was he hired for?
“A. Engineer for running the hoist. I have been an ironworker for ten years.
“Q. Do you know whether or not it takes any skill to be an ironworker?
“A. Why, sure, he has got to know, because, if he don’t know, why you know how it is.
“Q. How long does it take to teach a man — an ordinary mortal — that iron work?
“A. Well, it is a matter probably a year, or maybe two years, or maybe three years.
“Q. Was George Stierle employed as a hoist engine-man?
“A. Well, all I know is that he went onto the job and took hold of the hoisting machine—
“The Court: Then the order came from the superintendent to put him to what after the hoisting was done — ■
“Q. You had some orders from Mr. Stecher?
“A. Yes; I had my orders from Mr. Stecher. After we got the stack done, and the stuff away and down, there were four rivets missing on the girder. We had been putting a steel stack in there. This was an empty flue for another stack, and the hoisting engine was on top of the I-beam, and the girder that they could not rivet until it was brought away. You see, then, after we got the hoisting engine away from there, we got at it.'
“Q. What did Mr. Stecher say to you, if anything, about those rivets?
“A. Well, then, after I got the engine away, and let it down with the derrick, with my crab winch, because you could not hoist it down with men — I used that derrick to let it down with that. When I had everything down, then Mr. Stecher came there about towards evening; he gave me the orders that he knew there was some rivets left off, and he told me to go up and rivet them with George Stierle. So I take— we were just down below when he told me them words what to do. Then we went up, I and George Stierle, and got the planks ready, and then, when he got the planks ready — that was just one, first, so I went and told him to get some rope, about 10 or 12 feet long, so he went down below and got four ropes for me, so I says, ‘Now, George, you tie one on one end of the plank, and I will tie the other end to the plank.’ Then when we had the ends tied on the plank, then we let it down and tied it around the girder. > We tied it to be good and safe, so George Stierle asked me that would not be wide enough — one plank — so I says it would not be wide enough, so he asked me, ‘Wouldn’t it be better to put another by the side of that?’ I said, ‘Yes.’ Well, so he goes on the other side — there was some plank lying there — we got another plank, brought it over to the same place, placed it on the girder. Well, when we first found the girder, then I told George Stierle to tie them, the ends of the rope on the plank, and I would help let them down and tie them around the girder; so he done this; so he jumped on the plank where we had it first tied, and then he was tying the other, and I walked away on the other side east of the girder, and was looking down. * * * Then when I was looking down, then I heard a noise back of me; then when I turned around I seen that plank, and George Stierle going down through the flue, about 85 feet down.
“Q. How wide was that flue across?
“A. That flue would be about 18 or 20 feet, nearly that. This flue was extended from the bottom of the basement to the top of where I was. The flue to the top of the roof — it was 110 feet high, but that was about 15 feet below the roof where the girders were placed, to put the base of the stack on. It was 15 feet below the roof where Stierle was working. * * *
“Q. Now, before you called Mr. Stierle from the ground to that point to do the work that you have described, did you give him any instructions as to what to do, to save himself or protect himself?
“A. No.
“Q. Did you tell him how to build a scaffold of this kind?
“A. No.
“Q. Do you know of anybody else, or whether anybody else did give him instructions beside yourself?
“A. Not that I know of. It takes an experienced man to do that kind of work. Mr. Stierle was not an experienced man in that line.”

The witness further testified that there might have been a false floor placed 5 feet below the point where Mr. Stierle was working; that the smokestack above the roof had been completed, and there was nothing to do but this little riveting of these girders; that the work was all done on the day the accident occurred; that, in his judgment, a floor might have been placed on the flanges a little below where he and Stierle were at work. He further testified that defendant had nothing to do with the erection of the building, with the exception of the erection of the smokestack. The ordinance referred to was introduced in evidence.

Upon the question of the time of the death of the plaintiff’s intestate, witness testified that after Stierle fell he saw him within 10 or 15 minutes, and that he was still alive; that he fell 85 feet, and upon a pile of iron.

On cross-examination the following occurred:

“The Court: Is it conceded this man was killed at that time?
“Defendant’s Attorney: I don’t know; there is no proof of that.
“Q. Was he dead when you went down?
“A. No.
“Q. How long did he live?
“A. Why, I could not tell you how long he lived.
“Q. How do you know that he was alive?
“A. He was down there breathing, and he must have been alive.
“Q. Was he conscious? Could he talk?
“A. No; he could not talk.
“Defendant’s Attorney: You know he lived about two hours after that, don’t you?
“A. I don’t know how long he lived.
“The Court: There cannot be any question about that, but what he died as the result of the accident.
“Defendant’s Attorney: Do you concede he lived
about two hours after this?
“Plaintiff’s Attorney: We do not concede any such thing. He never regained consciousness; that is our contention.
“Defendant’s Attorney: Well, do you rest at that point?
“Plaintiff’s Attorney: Yes.”

At this point, at the close of the plaintiff’s case, the defendant’s attorney moved for a directed verdict in favor of the defendant:

(1) On, the ground that plaintiff’s decedent must have assumed the risk of this accident.
(2) On the ground that he was guilty of contributory negligence.
(3) That the defendant has not been shown to have been guilty of any negligence.
(4) That, if there was any negligence, it was the negligence of a fellow-servant.
(5) That it has been shown by the testimony that plaintiff’s decedent was not instantly killed; that this action is brought under the death act, which only applies in cases of instantaneous death, therefore it must fail, and a verdict should be directed.

Thereupon the trial court directed a verdict for the defendant, mainly upon the ground that the ordinance introduced in evidence had no relation to a building of this description; and also upon the ground that the evidence did not show that the defendant was guilty of any negligence. There was motion for a new trial, which it will be unnecessary for us to dwell upon. It is sufficient to say that the motion was denied solely on the ground that the ordinance of the city had no application whatever to the case under consideration. A judgment for the defendant was entered, and the plaintiff has brought the case here for review, and the errors assigned are pointed to, the directing of the verdict by the court and the reasons therefor, and that the court erred in not submitting the plaintiff’s case to the jury.

The first section of the ordinance introduced upon the trial reads as follows:

“It shall be the duty of all owners, contractors, and builders, and all persons who shall have the supervision or control of the construction or modeling of any building more than 30 feet high, to put in and lay upon the upper side of the joists or girders of each story in any building, as soon as the joists or girders are laid, a good and substantial, temporary or permanent floor for the protection of employees, and all persons engaged in or upon the construction of said building, in which floor no unprotected opening shall be left, and it shall be unlawful to place or put up joists or girders of another story until each lower floor is laid. And it shall be the duty of all owners, contractors, builders, or persons having the control or supervision of any building which shall be more than 30 feet high to see that all stairways, elevator openings, flues, and all other openings in the floors shall be covered or properly protected.”

1. A careful examination of this ordinance leads us to the conclusion that the court did not err in holding that it had no application to the case under consideration. While the evidence is not as clear as might be desired, it appeared that, owing to the peculiar construction of this building, it was not divided into stories as buildings usually are, but consisted of one large, high room, in which were installed certain boilers and other structures which were reached by independent stairways, over the construction of which defendant had no control. By the undisputed evidence, the work of the defendant was limited to the construction of the smokestack upon the roof of the building. We think the trial court might well have placed the decision of this question upon the ground that the defendant did not come within the terms or purview of this ordinance. The ordinance relates to the duties of persons engaged in the construction of buildings. Clearly this defendant did not construct this building or model it. The ordinance imposes the duty upon the builder as the work proceeds, and makes it unlawful to place or put up joists or girders of another story until each lower floor is laid, and the further duty of covering stairways, elevator openings, and flues is imposed upon the builder or person having control or supervision of' the building. We think, however, that the case should not have been disposed of upon this question. The defendant took this building as it found it.

The first count of the declaration is based upon the common-law duty of the defendant to furnish and provide for plaintiff’s decedent a safe place in which to work, and suitable means and appliances to work with. The deceased appears to have been a young man, 26 years old, who had been employed by this defendant for 6 months operating an electric motor for hoisting purposes. On the day of decedent’s death the defendant was just finishing certain work of erecting a smokestack on the Edison building. The motor and the platform upon which it stood were so placed that it was necessary to move them in order-to place certain rivets. The testimony tends to show that the defendant did not wish the motor disturbed until its work was done, and had agreed with another contractor to place those rivets after the motor was removed. Finally the work was done, the motor had been taken down, and plaintiff’s intestate was on the ground below, when he received an order, which we think the evidence shows was not within the scope of his employment, to assist to place those four rivets. We have already referred to the testimony of Darge. as to his instructions from the superintendent. That the latter represented the defendant as vice principal is not questioned here.

We think that the common-law rule is that, where an inexperienced servant is put to dangerous work, or is sent into a dangerous place to work, outside of the scope of his employment, the master is liable for all injuries resulting to the servant from being exposed to those unusual risks which are not apparent, and which are not understood or appreciated by the servant, and which can only be learned by experience in doing the work; and that, unless the master warns, instructs, and informs the servant as to all the dang'ers incident to the work which are not discoverable from ordinary observation by an inexperienced person who would have no reason to anticipate danger, the master is liable where injury follows because of the servant’s lack of knowledge, and because he was unwarned and uninformed. This principle is supported by many authorities in this State. A master is liable for injuries to his servant resulting from the master’s negligence in exposing the servant to risks which the latter is incapable of appreciating. Chicago, etc., R. Co. v. Bayfield, 37 Mich. 205; Jones v. Railway Co., 49 Mich. 573 (14 N. W. 551); Smith v. Car Works, 60 Mich. 501 (27 N. W. 662, 1 Am. St. Rep. 542); Walker v. Railway Co., 104 Mich. 606 (62 N. W. 1032) Courtois v. Paper Co., 172 Mich. 305 (137 N. W. 699); Menere v. Consolidated Co., 169 Mich. 367 (135 N. W. 249).

If decedent was taken from an employment in which he had been engaged, and put by defendant in an unsafe place, without instruction, the defendant might be liable. It was defendant’s duty to know, not to infer, that plaintiff’s decedent had this knowledge. Charron v. Carbide Co., 151 Mich. 687 (115 N. W. 718).

We think that (applying the rule which requires us to take the most favorable view of the plaintiff’s evidence in cases where the court directs a verdict for the defendant) it cannot be said that there was no evidence of the negligence of the defendant. Neither can it be said, as matter of law, in our opinion, that the plaintiff’s intestate assumed the risk, or that he was guilty of contributory negligence. We think that these were all questions of fact which should have been submitted to the jury under proper instruction. We think there was evidence that this was an extraordinary risk, both as to place and as to the appliances to be used, and plaintiff’s intestate, an inexperienced man, was, by defendant, sent into a dangerous place. Parkhurst v. Johnson, 50 Mich. 70-72 (15 N. W. 107, 45 Am. Rep. 28); Smith v. Car Works, supra; Barr v. Cask Co., 129 Mich. 278 (88 N. W. 640).

That the question of assumption of risk was a question for the jury is sustained by the following cases: '' James v. Mining Co., 55 Mich. 335 (21 N. W. 361); Chicago, etc., R. Co. v. Bayfield, supra; Ostrander v. City of Lansing, 111 Mich. 693 (70 N. W. 332).

A servant assumes only those risks which are incident to his usual employment, and of which he had knowledge, or of which he should have known. Thomas v. Railroad Co., 114 Mich. 59 (72 N. W. 40); Brown v. Railroad Co., 118 Mich. 205-208 (76 N. W. 407); Shadford v. Railway Co., 121 Mich. 224 (80 N. W. 30); Potter v. Railway Co., 122 Mich. 179 (81 N. W. 80, 82 N. W. 245); Noble v. Steamship Co., 127 Mich. 103 (86 N. W. 520, 54 L. R. A. 456, 89 Am. St. Rep. 461); Snow v. Power Co., 162 Mich. 579 (127 N. W. 677); Cristanelli v. Mining Co., 154 Mich. 423 (117 N. W. 910).

We do not think that the evidence in the case would justify us in saying that the negligence complained of was that of a fellow-servant. There is no evidence that Darge was guilty of any negligence; but the negligence, if any, was that of the defendant acting through its superintendent.

2. Upon the question of whether death was instantaneous within the meaning of that term, and referring to the manner in which the question was treated by the trial court, we are of opinion that the court would not have been warranted in directing a verdict for the defendant upon that ground. Upon this subject we quote the following language of Chief Justice Hooker, in the case of Olivier v. Railway Co., 134 Mich. 367 (96 N. W. 434, 104 Am. St. Rep. 607, 3 Am. & Eng. Ann. Cas. 53). He said:

“We see no reason for splitting hairs as to what is meant by instantaneous death, though we can appreciate thé difference between a continuing injury resulting in drowning, or death by hanging, throwing from a housetop, etc., and one where a person survives the wrongful act in an injured condition.”

See, also, West v. Railway, 159 Mich. 269 (123 N. W. 1101), where it is said by Justice Brooke, speaking for this court:

“Where there is a continuing injury, resulting in death within a few moments, it is ‘instantaneous’ within the meaning of the statute.”

In that case the deceased continued to live for some 15 minutes after he was struck by the car, though he was dead when taken from beneath the car; and it was contended that the appropriate remedy was under the “Survival Act.”

We think the following language of Chief Justice Shaw, in Kearney v. Railroad Corp., 9 Cush. (Mass.) 108, is appropriate:

“We are to ascertain what the intent of the legislature was when they passed the law. It is not to be supposed that they intended to make a distinction between a case where the death was so instantaneous that there was no manifestation of life whatever and a case where there might be some slight spasmodic action of the body of the sufferer to indicate that life was not quite extinct.”

For the errors pointed out, the judgment of the circuit court, is reversed, and a new trial granted.

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


text:
    HEILWIG v. NYBECK.
    1. Compromise and Settpement — Tax Titles — Evidence.
    Plaintiff entered into a contract with a third party to buy, and the third party to procure and convey to plaintiff, certain tax interests, and give the statutory notices to redeem to the owners of the record title. Plaintiff paid one-half the purchase price and entered into possession, and planted a crop of potatoes. The claimant of title harvested the crop. Later plaintiff’s attorney attempted to effect a compromise of the claim of plaintiff who received a part of the amount agreed upon: plaintiff, however, denied that he consented to compromise» his claim and accept that amount in full settlement. Held, to raise a question of fact for the jury as to the alleged compromise.
    2. Taxation — Vendor and Purchaser — Interest oe Purchaser— Possession.
    A contract with a person who had no interest in certain land, to procure tax titles outstanding and to convey them to plaintiff, gave plaintiff no right of possession as against the holder of the record title, especially when no notice to redeem was ever served.
    3. Wills — Husband and Wife — Life Estate.
    Where the testator by his will devised to his wife all his estate, real and personal, with full control during her life, and power to bequeath and devise the property to their children, in such shares as she might think proper; testator expressing a hope that if their conduct was satisfactory the property might he equally divided, the will conveyed a life interest which she was entitled to transfer by deed.
    4. Life Tenancy — Tax Titles — Purchase—Payment.
    By procuring a deed from the purchaser of a tax title for taxes which the life tenant ought to have paid, the latter acquired no additional interest hut quieted title to the property and in legal effect paid the tax.
    5. Estates — Real Property — Products.
    Ownership of real property carries with it as an incident the prima facie right of ownership of both the natural products of the soil, trees, etc., and the emblements or annually sown crops: a mere intruder who plants crops on the land is not entitled to the products so long as they remain unsevered.
    6. Same — Trespass—Life Estate — Emblements.
    A mere possessor of public land, who has planted a crop thereon, cannot maintain an action against a purchaser who enters and removes it: the rule being well settled that a crop sown or planted by a trespasser and remaining unsevered belongs to the owner of the land.
    7. Trover and Conversion — Title—Crops.
    It is a defense to an action of trover for crops which the plaintiff claims to own that title of the realty is in a third party and not in plaintiff.
    8. Pleading — Notice of Defenses.
    In trover for the conversion of a crop of potatoes, the defendant may show that title to the land on which they were raised was in third persons, without giving special notice of the defense. In trover the right of property is in issue: possession is not sufficient to maintain the action, although it may be evidence of property. A mere intruder upon land cannot maintain the action.
    Error to Alger; Fead, J.
    Submitted January 15, 1914.
    (Docket No. 95.)
    Decided March 26, 1914.
    Trover by Herman Heilwig against Erickson Nybeck for the conversion of a crop of potatoes. Judgment for defendant, and plaintiff brings error.
    Affirmed.

      B. B. Stewart, for appellant.

      Henry B. Freeman, for appellee.
   Stone, J.

This is an action of trover, and involves the ownership- of a crop of potatoes, planted and cultivated by the plaintiff, and harvested and sold by the defendant in the year 1908. This crop was grown upon a piece of land hereinafter described. The amount and value of the crop were in dispute upon the trial. The connection of the respective parties with the land apon which the crop was grown was as follows:

In July, 1904, the plaintiff entered into a contract with Charles R. Brown, which was as follows:

“This agreement, made and entered into this 8th day of July, 1904, by and between Charles R. Brown of Marquette, Michigan, party of the first part, and Herman Heilwig of Munising, Michigan, party of the second part. Witnesseth: That whereas, the said Charles R. Brown has heretofore purchased in the name of Peter White, the southwest quarter (t4) of the northeast quarter (%) and the southeast quarter (14) of the northwest (*4) of section twelve (12) town forty-six (46) north of range twenty (20) west, for delinquent taxes of 1897, 1898, and 1901; and whereas the said Brown has undertaken to procure the said tax titles acquired by said White and to give the statutory notice requiring the owners of said land to redeem the same within six months; and whereas the said Herman Heilwig desires to purchase said lands: Now therefore, the party of the first part
agrees to sell said tax-title interest to the said Herman Heilwig, subject to the taxes assessed thereon from and after 1901 for the price and sum of $200.00, $100.00 cash in hand and the balance in one year from this date with interest at 7%. And the party of the first part further agrees to give the notices above referred to and in case said lands shall be redeemed by original owners, then the party of the first part is to repay to the party of the second part any and all moneys paid by him on said lands with interest at 7 %. And the party of the second part hereby agrees to purchase said tax title to pay for the same as above set forth. Witness bur hands the day and year above written.
“Charles R. Brown. “Herman Heilwig.”

This agreement was, upon the trial, first admitted in evidence by the trial judge, who afterwards ruled it out because it gave no right of possession to the plaintiff, to which ruling plaintiff excepted.

It appeared in evidence that after, the above agreement was made, plaintiff took possession of the land therein described, which had been vacant for some time, and fitted some of it for cultivation, and cropped it until 1908. Plaintiff did not live on the land, but lived about 2% miles from it. In the spring of 1908 plaintiff planted three or four acres of this land to potatoes and cultivated them. He testified that defendant knew that he, plaintiff, was working the land from 1904 down. About the middle of October, 1908, plaintiff went over to look at the crop, and found the defendant and three other men and three women digging the potatoes. Plaintiff said to defendant:

“You better quit; you have no right to go on this land.”

Defendant asserted a right, and invited plaintiff to go up to his house and see his deed. Plaintiff went with defendant, and was shown a deed of the land to the defendant. Defendant proceeded to harvest and sell the crop.

Plaintiff then employed counsel. His counsel, with his consent, attempted to settle with the defendant, and went so far as to get an offer of $75 from the defendant. In fact, it is undisputed that defendant paid plaintiff’s attorney $50 to apply on the settlement, which $50 the plaintiff accepted, but claims, in his testimony, that he never agreed to accept the $75 in full settlement. The remaining $25 was later offered to the plaintiff, and he refused to accept it in settlement. Whether there was a settlement or not, in our view of the record, presented a question of fact for the jury; and, as the trial court directed a verdict for the defendant, we must look further for a justification of such direction.

It appears that this land had been unoccupied for some years before the plaintiff went into possession; the valuable timber had been taken off by one John C. Fowle, who had claimed that he^ owned the property, after which it remained wild and unoccupied, and had been sold for taxes before the plaintiff went upon the land. It appears in evidence that after the defendant took possession of the land, Charles R. Brown paid back to the plaintiff the $200 which the plaintiff had paid him on the contract.

On the part of the defendant, the evidence showed that he was a section foreman on the railroad, and had lived in the section house located on a part of the premises, the railroad running through the land. The defendant testified that he knew the plaintiff, and knew that he planted some potatoes on this land in the year 1908, and knew that he had taken possession of the land in 1904, and saw him working there at different times. As tending to show the defendant’s right to the premises, and therefore to the crop of potatoes, the following instruments were offered in evidence: A patent from the United States government to John Carney, bearing date December 10, 1880, recorded July 6, 1882, conveying the premises in question. The defendant then offered in evidence the last will and testament of John Carney, deceased, which was admitted to probate in Marquette county November 10, 1884, and was as follows:

“Know all men by these presents, that I, John Carney, of the city of Marquette, in the county of Marquette, State of Michigan, being of sound and disposing mind and memory, but in feeble health, do make and publish this my last will and testament. I give and devise to my loved wife, Bridget Carney, all my property, real and personal and all my right, title and interest» in my property, which I may acquire after the date of this will, and the above mentioned property is to be and remain under her control during her life, with full power at the time of her death to devise and bequeath to our three children in such shares as to her may seem fit; at the same time I express a hope that if each of said children’s conduct be satisfactory to my wife, that the property would be equally divided between them after her death. This suggestion I do not intend to deprive her in any way of disposing of the power above mentioned. I ordain and appoint my wife, the said Bridget Carney, executrix of this my last will and testament.
“In testimony whereof, I have hereunto set my hand and seal, and publish and declare this to be my last will and testament, in the presence of the witnesses below named, this 12th day of August, in the year of our Lord, 1884.
“John Carney.”

Defendant next offered in evidence a deed from the auditor general of the State of Michigan to Charles Johnson, being the usual auditor general’s deed, for the delinquent taxes of 1886. The deed bears date February 8, 1892, and was recorded February 22, 1892. This deed was received in evidence over the objection and exception of plaintiff. Defendant then offered in evidence the record of a quitclaim deed from Charles Johnson and wife to Bridget Carney, dated May 11, 1892, conveying the premises described in the patent. The defendant next offered in evidence the record of a warranty .deed dated April 30, 1892, from Bridget Carney of Marquette, Mich., to John C. Fowle, and recorded May 20, 1892 — consideration $400. Defendant then offered in evidence the record of a quitclaim deed from John C. Fowle and wife of Newburgh, N. Y., to the defendant. This deed was dated August 10, 1908, and recorded August 26, 1908, and expressed a consideration of $350.

With the récord in this condition, the trial court directed a verdict for the defendant, charging the jury, among other things, that the plaintiff’s entry upon this land was that of a squatter, or trespasser, that he had no right or title therein, and that he could not maintain the action for the reason that he was not the owner of the property in question, and a judgment for the defendant was entered.

The plaintiff has brought the case here for review, and assigns error upon the charge of the court above indicated, and also that the court erred in rejecting the contract offered by the plaintiff between himself and Charles R. Brown; also that the court erred in receiving in evidence the tax deed from the auditor general to Charles Johnson.

An examination of the record satisfies us that the contract between Charles R. Brown and the plaintiff gave the latter no right to the possession of the land. There is nothing to indicate that Brown had any title whatever to the property, and at most he undertook to procure the tax titles which had been acquired by Mr. White. There is no evidence that any of the statutory notices were ever given as contemplated by the contract; and it requires no citation of authorities to show that the instrument gave neither Brown nor the plaintiff any right to the possession of the land in question. We do not think there is any doubt of the correctness of the charge that the plaintiff was a mere squatter, or trespasser, upon this land, so far as is shown by the record.

What were the defendant’s rights? We are of opinion that the will, properly construed, gave Bridget Carney a life estate in this property, which she had a right to convey, and her grantee would take her life estate. We do not agree with plaintiff’s counsel that it would be necessary for Bridget Carney to obtain any license from the probate court to convey her life estate. So .far as the record speaks, Bridget Carney is still alive, and that fact would give defendant a right to possession of the premises during her life. By comparison of the dates it does appear that it was the duty of Bridget Carney, as the life tenant, to pay the taxes of 1886. We think by her deed from Charles Johnson she quieted his title to the property, but the transaction amounted to the payment of taxes by her. The reception in evidence, however, of this deed was harmless error at most.

The question then arises whether the plaintiff can maintain an action of trover. At the time this crop of potatoes was planted, and for some years prior thereto, John C. Fowle was the owner of the life estate of Bridget Carney, and was entitled to possession of this property; and it must be held that the plaintiff was a mere intruder.

It is a familiar rule that the ownership of realty carries with it, as an incident thereto, the prima facie presumption of the ownership of both the natural products of the land, such as grass and trees, and the emblements, or annually sown crops, and that where a mere intruder upon the land plants crops thereon, such crops, so long as they remain unsevered, are the property of the owner of the land. 12 Cyc. pp. 976, 977, and cases there cited.

A mere possessor of public land who has planted a crop thereon cannot maintain an action against a purchaser who enters and removes such crop.

The rule is well settled that a crop sown or planted by a trespasser, so long as it remains unsevered, belongs to the owner of the land. Warner v. Sohn, 86 Neb. 519 (125 N. W. 1072). See note to this case reported in 21 Am. & Eng. Ann. Cas., at page 431, where many cases are cited, including that of Stebbins v. Demorest, 138 Mich. 297 (101 N. W. 528). In the case last cited Justice Hookes, speaking for this court, said:

“As the growing crop of oats did not belong to the trespasser, it became the property of the owners of the premises, i. e., the lessee, plaintiff, who can maintain trover therefor.”

At the time this crop was planted we have shown that the title, so far at least as the life interest of Bridget Carney may extend, was in John C. Fowle, and it was competent, therefore, for the defendant to show title in this third person at that time. That this may be done in an action of trover without giving notice thereof under the general issue, where the declaration does not show plaintiffs source of title, as it did not in this case, was held by this court in Williams v. Brown, 137 Mich. 569 (100 N. W. 786).

The evidence in this case so connects the defendant with the title to this land that he was entitled to show the fact of the outstanding title in Fowle when the crop was planted to defeat the plaintiffs cause of action.

In Isle Royale Mining Co. v. Hertin, 37 Mich. 332 (26 Am. Rep. 520), the plaintiff had by mistake cut certain timber upon defendant’s land into cordwood, which the defendant took and used. The plaintiff sought in trover, and under a special count to recover at least the value of the labor he had expended upon the wood. It was held that he was not entitled to recover at all in the action. This case has been cited with approval by this court a number of times.

“In trover the right of property is in issue, and to sustain the action the plaintiff must prove property in himself, either general or special. Possession is not sufficient for that purpose as in trespass; it is evidence of property, but it does .not, as in trespass, preclude defendant from showing property in a third person.” 2 Stevens’ Michigan Practice, § 291, citing many early Michigan cases.

See Stephenson v. Little, 10 Mich. 439; Parkhurst v. Jacobs, 17 Mich. 302-306; Brady v. Whitney, 24 Mich. 154-156; Stearns v. Vincent, 50 Mich. 209 (15 N. W. 86, 45 Am. Rep. 37).

Defendant can show, for the purpose of defeating the action, that plaintiff had no right of possession. The plaintiff here has shown no relationship between himself and Fowle, the owner of the land, upon which the crop was planted, nor has he shown any right to the possession of the land. He was a mere intruder. We are of opinion that the circuit judge reached the right conclusion in this case, and the judgment of the circuit court is affirmed.

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