text:
    DETROIT ELECTRIC LIGHT & POWER CO. v. APPLEBAUM.
    1. Evidence — Admissions and Explanations.
    A party relying upon the admissions of. the opposite party to prove a material fact is not concluded by the explanations and statements made at the same time as the admissions.
    2. " Instructions — Honest or Dishonest Transactions.
    A charge that, where a transaction admits of- “ eitheran hon- - est or a dishonest construction, it is the duty of the jury to accept the former, is erroneous.
    3. Receivers — Right to Sue.
    A receiver who has not rendered his final account or been discharged, whose bond is in force, and who has been authorized by the court to do so, may sue to recover assets of the estate, though previous to the suit the estate had beeiysold to him in a trust capacity.
    Error to Wayne; Rohnert, J.
    Submitted December 2, 1902.
    (Docket No. 129.)
    Decided March 30, 1903.
    Trover by the Detroit Electric Light & Power Company, Hoyt Post, receiver, against Isaac Applebaum and Alexander C. Cohen, copartners as I. Applebaum & Co. Prom a judgment for defendants, plaintiff brings error.
    Reversed.

      Wilkinson, Post & Oxtoby"and Walter E. Oxtoby, for appellant.

      Adolph Sloman, for appellee Applebanm.

      A lex. J. Groesbeck, for appellee Cohen.
   Moore, J.

This is an action brought by the Detroit Electric Light & Power Company, under the receivership of Hoyt Post, against the defendants, for the value of 7,728 . pounds of copper wire alleged to have been stolen from-plaintiff by certain of its employes, and by them sold to the defendants. The defendants obtained judgment. The case is brought here by writ of error.

The record shows the plaintiff company became embarrassed, and Mr. Williams was appointed receiver in May, 1899. The transactions out of which this suit springs occurred in April and May, 1900. At this time Mr. Williams was receiver, Daniel,A. Casey was manager, and Robert A. Tress was line foreman of the company. The defendants were copartners in business under the firm name of I. Applebaum & Co. Isaac Applebaum carried on individually a separate scrap-iron business. The offices and yards of the two concerns were together, and adjoined the Detroit Electric Light & Power Company. One of their yards was on Woodbridge street, adjoining the power plant of the cbmpany, and their office and other yard was on Randolph street, separated from the power plant by a building occupied by a foundry. In April and May defendants purchased from Tress 7,728 pounds of old copper wire, for which this suit is brought. It was the claim of plaintiff that Tress and Casey were acting in collusion; fhat the wire belonged to the plaintiff, and was sold by Tress, individually and without authority, to the defendants; that having bought from Tress individually, who had no title, the defendants received no title, and were liable in trover. The defendants’ theory was that they bought in good faith from the Detroit Electric Light & Power Company, through Casey, as manager, and Tress, as line foreman; that, knowing of no secret limitations on their apparent authority, they had a right to rely in good faith 'upon such apparent authority; that, having done so, they did not become liable, even if in fact Tress and Casey exceeded their authority in selling, and embezzled the proceeds of such sales. The record contained testimony tending to support both theories.

The first error demanding attention is the refusal of the court to submit to the jury plaintiff’s theory of the case, to wit, sales by Tress of wire as his own property, without reference to plaintiff’s ownership, on the ground that, the plaintiff’s ownership of the property being shown by defendants’ admissions, plaintiff must take all of such admissions or none. The court refused to submit to the jury the question whether the defendants bought the wire from Tress as his own property, and without reference to the ownership of the plaintiff company, in which case they acquired no title to it; Tress having none himself. The court did this on the ground that, as plaintiff proved the receipt of its property by defendants from their own admissions, plaintiff must take both the admissions and the explanation, and could not take the admission and contradict and do away with the explanation.

There was testimony tending to sustain plaintiff’s contention that defendants actually knew that the wire belonged to- the plaintiff, and yet undertook to buy it of Robert A. Tress individually, and that as an afterthought they took the ground that they bought from the plaintiff, —such as the statements made by the defendants in police court, and the entries of the transaction which appeared upon the books of defendants, at least some of which were changed. The plaintiff could avail itself of the admissions made by the defendants that the property bought of Tress was its property without being bound to accept all of the defendants’ statements as to what they supposed about the ownership of the property. The jury might believe that part of the admission which charged the defendants, and disbelieve that part which made a defense, if the latter was improbable and discredited by the other testimony. See Liesenier v. Burg, 106 Mich. 124 (63 N. W. 999); Parret v. Craig, 56 N. J. Eq. 280 (38 Atl. 305); Craig v. Parret, 56 N. J. Eq. 848 (42 Atl. 1117); Delamater v. Pierce, 3 Denio, 315; Roberts v. Gee, 15 Barb. 449. In Schmidt v. Pfau, 114 Ill. 494 (2 N. E. 522), the court says:

“ The answer of appellant to this is to the effect that, if his testimony is looked to for the purpose of proving any particular fact, it must be accepted as a whole, and for all purposes. This view of the law is clearly unsound, and finds no support from English or American authority. It is a familiar principle of the law of evidence as it obtains in this country and in England that the statements' of a party, made against his own interest, may be accepted and acted upon by the jury as true, while others made in his favor, though at the same time and as part of the same conversation, may be rejected as unworthy of belief. In such case all that the witness has said relating to the particular matter in question goes to the jury for their consideration, but, when considered, they may believe such párts of the statement as seem reasonable and probable, and reject the balance. 2 Best, Ev. § 520.”

Complaint is made of the following part of the charge :

“The law presumes that parties, in their dealings, intend to conduct them honestly; and, where a transaction which is challenged will admit either of an honest or a dishonest construction, it is the duty of the jury to accept the former, — that is, to accept the honest construction.”

Counsel for appellees suggest that a typographical error crept in, and the word “either” was used when it was intended to use the word “equally.” If the word “equally” had been used, the charge would not have been objectionable; but unfortunately it was not used, and by the charge a burden was put upon the plaintiff which does not exist even in cases of fraud. See Watkins v. Wallace, 19 Mich. 57; Sweeney v. Devens, 72 Mich. 301 (40 N. W. 454); Kipp v. Lamoreaux, 81 Mich. 299 (45 N. W. 1002); Morley v. Insurance Co., 85 Mich. 210 (48 N. W. 503);Knop v. Insurance Co., 107 Mich. 323 (65 N. W. 228).

The other assignments of error which have been urged have been considered, but, as the questions involved are not likely to arise again, we do not deem it necessary to say any more about them.

On the part of the appellees it is claimed that as the property, including choses in action, of the Detroit Electric Light & Power Company, had been sold, before this suit was brought, by virtue- of a decree entered in the foreclosure case, to Hoyt Post, trustee, and a deed made to him by the special master commissioner, Hoyt Post, as receiver, cannot maintain this action, and the verdict and judgment ought to stand. The sale was made to Hoyt Post, as trustee, June 39, 1900, and-the master’s report of the sale was filed June 30th. August 1, 1900, Mr. Williams resigned as receiver, and on the same day the court accepted his resignation, and appointed Hoyt Post receiver, and authorized said receiver to institute and prosecute all such suits as, in his judgment, were necessary. The deed from the special master to Hoyt Post, trustee, was made September 18, 1900. The record also shows that on the petition of Hoyt Post, receiver, the court having charge of the foreclosure proceeding made an order October 6, 1900, authorizing suit to be brought against Isaac Applebaum and Alexander C. Cohen, under the name and title of “Detroit Electric Light & Power Company, Hoyt Post, Receiver,” for the recovery of the value of the copper wire received by them 'from' employés of Nathan G. Williams, receiver. The record further shows he is still receiver, that he has not been discharged or rendered his account, and that his bond as such receiver is in full force. With the record in this condition, we have no doubt of his right to prosecute this suit.

Judgment is reversed, and new trial ordered.

The other Justices concurred.


source: Caselaw Access Project

author: Montgomery, J.

license: Public Domain

text:
    EMERY v. KALAMAZOO & HASTINGS CONSTRUCTION CO.

    1. Partnership Associations — 'Voluntary Dissolution.
    Two months before the end of the term of a partnership association, on a notice to members of a meeting for the consideration of a final settlement of the partnership affairs and the distribution of its assets, a resolution was passed to exchange its assets for stock in a railroad corporation, and divide it among its members. Held, that this was a voluntary winding up of the affairs of the partnership association, and did not comply with the provisions of the statute (2 Comp. Laws, § 6087).
    2. Same.
    A majority of the stockholders of a limited partnership association have no power to wind up its affairs by exchanging its property for stock in a corporation, and compelling a non-assenting shareholder to become a member of the corporation, and accept stock for his holding.
    8. Same — Estoppel.
    A member of a partnership'association, by receiving payment from a corporation of a partnership note which the corporation has assumed, is not estopped from objecting to the exchange of the partnership property for stock of the corporation, made for the purpose of winding up its affairs.
    4. Same — Railroads—Ownership of Stock.
    The fact that all of the stock of a railway company is owned by a partnership association does not prevent a member of tjhe partnership from objecting to the surrender of the railway company’s note for additional stock in the railway company in settlement of the partnership affairs, on the theory that the debt of the railway is really the debt of the partnership.
    Appeal from Kalamazoo; Adams, J.
    Submitted January 8, 1903.
    (Docket No. 17.)
    Decided March 30, 1903.
    Bill by Elma Cahill-Emery, individually and as guardian of Lee H. Cahill and Margaret Cahill, heirs at law of Leroy Cahill, deceased, against the Kalamazoo & Hastings Construction Company, Limited, William S. Dewing, James H. Dewing, and Charles A. Dewing, copartners as Dewing & Sons, Martha A. Watson, executrix of the estate of Amasa B. Watson, deceased, Annie E. Cobb, executrix of the estate of Thomas S. Cobb, deceased, Edward Woodbury, Henry E. Badger, G. Edwin Dunbar, Charles S. Burton, Frank A. Bush and Benjamin A. Bush, administrators of the estate of Frederick Bush, deceased, E. A. Bush and B. A. Bush, administrators, and Thomas Paterson, doing business as Bush & Paterson, and the Chicago, Kalamazoo & Saginaw Railway Company, to-rescind certain action of the managers of the Kalamazoo & Hastings Construction Company, Limited, and to wind up its affairs. From a decree dismissing the bill, complainant appeals.
    Reversed.

      Charles S. McDonald and George B. Fowler (Hdioard Cahill, of-counsel), for complainant.

      Howard & Howard and Carroll, Turner & Kirwin, for defendants.

       Rehearing denied June 1, 1908.

   Montgomery, J.

This is a suit in equity brought by Elma L. Cahill (now Elma Cahill-Emery), in behalf of herself, as widow, and as guardian of her two children, Lee H. Cahill and Margaret Cahill, minors, heirs at law of Leroy Cahill, formerly of Kalamazoo, now deceased. The action is a stockholders’ bill to rescind certain actions on the part of the managers of said construction company, to compel a restoration of the assets of the construction company, and to provide for the proper distribution of such assets among the members, and for the protection of its stockholders.

The Chicago, Kalamazoo & Saginaw Railway Company was organized January 17, 1883, and articles of association were amended December 10, 1887, when the authorized capital stock of the company was made $2,000,000. Of the $2,000,000 of authorized capital stock, only 715 shares were subscribed for, and only $5 per share — $3,575 in the aggregate — was ever paid in. No progress was made in building the road until 1886, when the various individual subscriptions to the stock of the railway company were bought up by F. A. Bush and W. L. Eaton, as trustees; at least, so much of the stock as was not subscribed for by the individuals who afterwards formed the Kalamazoo & Hastings Construction Company, Limited. Eaton was afterwards succeeded by W. S. Dewing as trustee, and thereafter this stock was held by W. S. Dewing and F. A. Bush, both of whom are defendants in this case.

The Kalamazoo & Hastings Construction Company, Limited, was organized September 21, 1886, as a partnership association, limited, under chapter 160, 2 Comp. Laws, which act is specially referred to in the articles of association. The members were partly made up from former subscribers to the railway company stock, and partly from other individuals. The capital stock was fixed at $200,000, which was paid in in cash. The intended business of the construction company was to build a railroad for the Chicago, Kalamazoo & Saginaw Railway Company, and this purpose was expressly stated in the articles. The road contemplated was to extend from Kalamazoo to Hastings, in Barry county. Leroy Cahill was a subscriber to the capital stock of the construction company in the amount of $12,500, which amount he paid in in cash. Mr. Cahill never owned any stock in the railway company. Leroy Cahill died October 8, 1898, and his widow and minor children succeeded to his interest in the construction company, and are the complainants in this case. This fact is admitted in the pleadings.

In pursuance of the purpose of the construction company, a contract was entered into between the construction company and the railway company, by the terms of which the construction company was to build a railroad from Kalamazoo to Hastings. The contract price for the construction of the road was to be $15,000 per mile in 5 per cent, bonds, and $7,500 per mile in capital stock of the railway company. Several modifications of the contract were made from time to time. April 24, 1889, it was -decided to extend the road from Hastings to Woodbury on the same terms and conditions as the previous contracts called for. November 21, 1893, the contract was -changed in regard to compensation and contract price, and by this change the construction company was to receive $15,000 per mile in 5 per cent. 50-year gold bonds, and $9,500 per mile in stock; the same to be in full for all demands for construction and equipment. The road was completed, and trains running from Kalamazoo to Wood-bury, September 1, 1889. The entire length of the road up to November 1, 1895, was 44.21 miles. The cost of the road to the construction company up to November 21, 1895, was $53.2,545.86 in cash. This amount was derived by the construction company from the following sources: Capital stock paid in in cash, $199,575; borrowed on construction company coupon notes, $179,750; bonuses from towns, $69,507.31; assessment on stockholders of construction company, afterwards returned, $7,847.55; railway company notes, $20,650; earnings returned to road in new construction from September;, 1889, to November 1, 1895, $55,216,— a total of $532,545'.86.

After the completion of the road, it was found impossible to sell the bonds, and the road was operated by and for the account of the construction company. Under the contract as it existed, no compensation was ever received by the construction company up to November 21, 1895, nor were any of the bonds or stock of the railroad turned over to the construction company, nor was any settlement ever made on that contract. On November 21, 1895, a new arrangement was entered into between the construction company and the railway company. By the terms of this agreement the construction company was to deliver to the railway company the road as then constructed between Kalamazoo and Woodbury, together with all equipment belonging thereto. The railway company was to assume all the outstanding indebtedness of the construction company to the amount of $225,000, which included the coupon notes; the actual amount then outstanding being about $216,000. It was to give to the construction company a. purchase-money note for $292,925, payable five years from date, with interest, and, in addition, to turn over to the construction company 3,785 shares of the capital stock .of the railway company. This agreement was carried out, and the note was executed by the president and secretary of the railway company, dated January 1, 1896, and delivered to the construction company. This action on the part of the officers of the company was ratified by the railway company July 14, 1896. A certificate of 3,785 shares of stock in the railway company was also delivered to the construction company. In addition to the 3,785 shares of stock of the railway company issued to the construction company under this agreement for the purchase of the road, there were outstanding 715 shares of stock of the railway company, held in part by individual members of the construction company, and in part by Bush an<^ Dewing, trustees, upon which 5 per cent, only had been paid in. This stock was now acquired by the construction company, and, in order to make these shares fully paid, the construction company gave its promissory note to the railway company for $67,925, or 95 per cent, of the par value of the 715 shares. This note was intended to be an offset to the purchase-money note of $292,925, thus leaving a net indebtedness to the construction company on said purchase-money note of the sum of $225,000, which is. hereinafter referred to as the net note of $225,000. The transfer of the road to the railway company was effected January 1, 1896.

Prof. M. E. Cooley testified that in the fall of 1900 he made an appraisal of the physical properties of the railroad as then existing, and found the value to be $504,890. This did not include franchises. This appraisal, in connection with the report to dhe railroad commissioner December 31, 1900, shows that the common stock of the road had no value. There had been paid in $3,575 on 715 shares, — just the amount required by law. It represented the control of the road. As carrying with it the control of the railway, it had some value, — a few dollars per share if any one wanted to buy the road. So far as the construction company was concerned, the common stock received by it cost the construction company practically nothing. It represented no money paid in, and was virtually valuable only for the control of the road. Such value as it had represented profits of the construction company on the contract.

September 21, 1895, the duration of the Kalamazoo & Hastings Construction Company was extended for five .years, expiring September 21, 1901. No material change •occurred in the management of either company from January 1, 1896, until the fall of 1900. The board of directors of the railway company and the board of managers of the construction company during this time was composed substantially of the same persons, most of whom are defendants in this action.

Some time in March, 1900, and previous to October 11, 1900, the interest of the Bowne estate and Henderson’s interest in the construction company was bought up by Dewing & Sons, Badger, and Woodbury; amounting in all to some $60,000. Dewing & Sons, Badger, and Wood-bury then held $101,875 interest in the construction company, which was a controlling interest. Later, on January 14, 1901, Dewing & Sons also purchased the interest of O. M. Allen, amounting to $5,000 of the capital stock of the construction company. Up .to October 11, 1900, the note of $292,925 was carried as a liability in the reports of the railway company, and was so reported on oath to the railroad commissioner, and on the memoranda which Mr. Potter testified were the only balance sheets which the company had, and from which.he made up his annual reports to the railroad commissioner.

On October 11,1900, and after Dewing & Sons, Badger, and Woodbury had secured a majority interest in the construction company, measures were taken to transform the past-due coupon notes of the construction company into-preferred stock of the railway company, and also to provide money for the extension of the road to Pavilion, some 11 miles south of Kalamazoo. A large part of the net earnings of the road had already been invested in a right of way, etc., for such extension. In furtherance of this plan, the construction company, at a meeting held October 11, 1900, at which meeting the defendants held a majority, voted to surrender the note for $292,925, and also 2,500 of the 4,500 shares of common stock of the railway company held by the construction company, provided the railway company would issue sufficient preferred stock to pay off the obligations of the railway company then outstanding, and extend the road, and also deliver back to the construction company its note for $67,925. There was a provision, also, that the stockholders of the construction company should have the right to subscribe to such issue of preferred stock pro rata to their holdings in the construction company. This was put in the form of a proposition emanating from the construction company to the railway-company.

On November 15, 1900, at a meeting of the directors of the Chicago, Kalamazoo & Saginaw Railway Company, it was voted to accept the surrender of the note for $292,-925 and 2,500 shares of common stock of the railway company, and to deliver up to the construction company its note for $67,925. It was also voted that the railway company issue $450,000 of 6 per cent, cumulative preferred stock for the payment of existing indebtedness and extensions of its line. This preferred stock could be called in and redeemed at par, with accrued dividends, on six months’ notice. In case of the sale of the road or the-bonding of the road, the first proceeds were to be applied to the payment of this preferred stock, before anything should be paid on the common stock. It was further provided that the preferred stock should not be sold for less than par and one share of common stock with each share of preferred; that it should be allotted to the members of the construction company pro rata according to their holdings in the construction company, and, any member declining or failing to subscribe for or take the full amount, the stock not then taken was to be reallotted pro rata, and the balance to remain in the treasury, to be sold from time to time as the requirements of the road necessitated. An immediate issue of $300,000 was authorized. The issue of preferred stock was begun January 1, 1901, and between that date and July 1, 1901, $230,000 in amount was issued. After the beginning of this action, and before the trial, sufficient preferred stock had been issued to bring the total amount at the time of trial to $270,000.

Mrs. Cahill-Emery, complainant, was not present at the meeting at which the surrender of the note for $292,925 and 2,500 shares of common stock was voted. A short time after the meeting, in the winter of 1901, Mr. Emery, as representative for Mrs. Cahill-Emery, came to Kalamazoo and consulted with Mr. H. C. Potter in regard to the transaction. Mrs. Cahill-Emery held coupon notes of the construction company amounting to $12,500. Mr. Potter proposed that she take payment in preferred stock. After some consideration, Mrs. Cahill-Emery decided that she did not care to take perferred stock, and desired the money on her notes. Payment was then deferred until later. In the meantime Mrs. Cahill-Emery became dissatisfied, and protested against the surrender of the note and stock by the construction company.

On July 5, 1901, the directors of the railway company held a meeting, at which were present defendants Wood-bury, J. H. Dewing, C. A. Dewing, W. S. Dewing, H. F. Badger, and Gr. E. Dunbar. These gentlemen held the majority of preferred stock then issued. At this meeting, after stating in a preamble the action of November 15,1900, and the authorization of an issue of preferred stock and‘the surrender of the note for $292,925 and 2,500 shares of common stock, it further states that it now appeared that the proposal submitted did not meet with the approval of all the members of the construction company, and that there was home misapprehension and dissatisfaction with the action taken. It was then voted to return to the construction company the 2,500 shares of common stock and the note for $292,925, and take back from the construction company its note for $6?, 925; “ thus placing the two companies in the same position which they occupied prior to November 15, 1900.” Pursuant to this vote the note for $292,92-5 was returned to the construction company by the railway company, and the common stock of the railway company, which had been issued as a bonus with the preferred stock, was returned by the persons who received it to the railway company, and by it turned back again to the construction company. Mr. Potter testified that Mrs. Cahill-Emery, the complainant, was the party dissatisfied, and was objecting to the proceedings. Mrs. Cahill-Emery was never a stockholder of the railway company. On July 9th, and four days after the railway company voted to return the note for $292,925 and 2,500 shares of common stock, Mr. Emery, in behalf of Mrs. Cahill-Emery, demanded and received payment on coupon notes of the construction company ($12,500) which Mrs. Cahill-Emery held, and payment of which the railway company had assumed by the act of November 21, 1895.

June 21, 1901, notice was sent out by the construction company, calling, a special meeting of the members July 5, 1901, “for the consideration of a final settlement with the Chicago, Kalamazoo & Saginaw Bailway Company, the distribution of the assets of the construction company, and the transaction of such other business as may be brought before the meeting. ” This meeting was ad j ourned to July 12th, when the meeting was held. At this meeting Mr. Emery, representing the complainant, was present, accompanied by counsel. The following preamble and resolution was offered by J. H. Dewing, and seconded by Mr. Woodbury:

Whereas, the duration of the Kalamazoo & Hastings Construction Company, Limited, expires by limitation .September 21, 1901; and
Whereas, this company holds an obligation of the Chicago, Kalamazoo & Saginaw Railway Company for $292,925, which.is offset in part by an obligation of this -company for $67,925; and
‘ ‘ Whereas, it is deemed expedient and advisable that the assets of this company be placed in such shape that they can be divided among its members :• It is therefore
Resolved, that the board of managers of this company be and are hereby authorized to accept from the Chicago, Kalamazoo & Saginaw Railway Company 2,250 shares, $100 each, of its common stock, and this company’s note for $67,925, now held by the Chicago, Kalamazoo & Saginaw Railway Company, in full payment of their obligation of $292,925 and all other demands whatsoever.”

Mr. Emery objected and filed a written protest. He also offered a substitute resolution as follows: “That the Kalamazoo & Hastings Construction Company, Limited, go into liquidation according to the laws of the State of Michigan,” — which was not seconded. The resolution being put to vote, the defendants voted “ Yes,” and Mr. Emery voted “ No.”

At the same meeting the following preamble and resolution was .offered:

‘ ‘ Whereas, all the debts of this company have been assumed by the Chicago, Kalamazoo & Saginaw Railway Company; and
Whereas, this company now has in its treasury 6,750 shares, $100 each, of the common stock of the Chicago, Kalamazoo & Saginaw Railway Company: Now, therefore, b,e it
Resolved, that the board of managers of this company {meaning said construction company] be and are hereby authorized to divide among the members of this association the $675,000 of the common stock of the Chicago, Kalamazoo & Saginaw Railway Company now in its treasury pro rata according to the individual holdings in the company, taking individual receipts therefor.”

On this resolution the defendants present voted “ Yes,” and Mr. Emery voted “No.”

Immediately after the former vote a recess was taken, during which time a meeting of the railway company, which had already been called, passed a resolution accepting the proposition of the construction company to surrender the note for $292,925, offset by the construction company obligation for $67,925 and interest, and to accept in lieu therefor 2,250 shares of common stock of the railway company; and it was further voted to issue 2,250 shares of common stock of the railway company, and deliver the same to the construction company, with its note for $67,925; the same to be in full payment of all demands whatsoever. Pursuant to this resolution the railway company did issue 2,250 shares of common stock, and delivered the same to the construction company.

Mr. Potter testified that the consideration for this issue of stock was the note for $292,925, and nothing else. He also testified that the property value of this railroad had not been increased by this increase of stock, except that the obligation of the railroad had been paid, and that the net note of $225,000 was an obligation of the railway company. Mr. J. H. Dewing, manager of the road, testified that the issue of 2,250 shares of common stock decreased the indebtedness of -the railroad $225,000. Mr. Potter further testified that the meeting was “cut and dried,”and the resolutions prepared under the direction of Mr. Woodbury and the Dewings; that they consulted with Mr. Howard, as counsel for the railway company, in regard to it. Mr. Potter testified that previous to the meeting of July 12, 1901, the assets of the construction company consisted of the net note of the railway company for $225,000 and 4,500 shares of stock in the railway company; that after the meeting of July 12, 1901, the assets consisted of 6,750 shares of common stock of the Chicago, Kalamazoo & Saginaw Railway Company; that the vote of July 12th distributing the shares of common stock to the individual members of the construction company distributed all the assets of the company. The construction company had done no business as a construction company since November 21, 1895. Between the meeting of July 12,1901, and the time of expiration of the corporate life of the construction company, September 21, 1901, no business act was done by the construction company, and no further act towards dissolving the company was taken. Mr. Potter testified that he received the certificates for 2,250 shares of common stock of the railway company in payment for the net note of $225,000, and that he held the proportionate interest of the members of the construction company in his possession subject to their order.

It does not appear that any of the certificates of common stock of the railway company have been distributed to the individual members of the construction company. The defendants are now the owners or holders of all but a few shares of the preferred stock of the railway company. On or about August 5, 1901, the complainants made a formal request upon the officers of the construction company that they procure the redelivery of the net note for $225,000, and that they bring suit to set aside the whole transaction as being unlawful and fraudulent, which request the construction company, by its officers and board of managers, refused. Thereupon the complainants brought their bill. On the hearing, on pleadings and proofs, the bill of complaint was dismissed, and from this decree the complainants appeal.

The vital question in the case is whether the action of July 12, 1901, should be sustained. Section 9 of the act providing for partnership,associations (being section 6087, 2 Oomp. Laws) reads as follows:

“When any such partnership association shall be dissolved by the voluntary action thereof, its property shall be applied and distributed as follows: First, to the payment of all debts for wages of labor; second, to the satisfaction of its other .liabilities and indebtedness; third, after payment thereof, the same shall be distributed to and among the members thereof, in proportion to their respective interests, in the following manner: Fourth, three liquidating trustees shall be elected by the members of the association, who shall have full power and authority to wind up the concern, and distribute the net assets thereof among the members, under the direction of thü circuit court of the proper county.”

If this section applies to the action taken on July 12th, it is very clear that it was not followed. But it is contended that it does not, first, because this was not a voluntary winding up of the affairs of the partnership association, but was, rather, a termination of the business at the end of its term. We think this is not strictly accurate. The partnership term did not end until September 21, 1901. This action was taken in July preceding, and, so far as it amounted to a dissolution of the partnership association, it/ constituted a voluntary dissolution. The notice sent out to the members was a notice of a meeting for the consideration of a final settlement of the partnership affairs and the distribution of the assets of the company. The resolution was a resolution for the division of the stock to be acquired by the trade pro rata among the shareholders in the partnership, according to the individual holdings in the company. We think it clear, therefore, that this was a scheme for the winding up of the affairs of the company, and that it is not authorized by the terms of this statute. We think it was entirely beyond the power of the majority stockholders to wind up the affairs of this company by exchanging its valuable property for shares of stock in another corporation, and compelling a certain shareholder to become a member of such corporation and to accept stock for his holding. We are unable to distinguish the case jin this respect from Mason v. Mining Co., 133 U. S. 50 (10 Sup. Ct. 224), where the whole subject is discussed, and the conclusion reached that such authority does not exist. See, also, 1 Mor. Corp. §§ 415, 416.

But it is claimed that complainant is estopped from objecting to this transaction by reason- of her having accepted the money in payment of the coupon notes, after preferred stock had been issued in pursuance of the agreement of October 11 and November 15, 1900. It is very clear that she is not estopped from objecting to the disposition of this $225,000 net note, made on July 12, 1901, as this action had not been taken at the time she received pay on the coupon notes; and, furthermore, when the coupon notes were paid, the action by which the $225,000 net note had been surrendered to the railway company had been rescinded by both the companies, and the note returned to the'construction company. The complainant then received her pay upon the coupon notes, as she had an undoubted right to do, unless the holders of the preferred stock should take some action to repudiate their purchase, either on the ground of fraud or want of power. No such action appears to have been taken by the holders of the preferred stock. So far as the record discloses, no complaint is made by them of the action of the railway company in rescinding the action of November, 1900, and in returning the $225,000 net note to the construction company. Indeed, the holders of nearly all the stock were parties to this transaction. If the preferred stockholders are content to rest upon the transaction as it stood after the rescission of the action of 1900, which was taken with the express purpose of placing the two companies in the same position which they occupied prior to November 15, 1900, it does not rest with them to complain that provision shall be made for the payment of the claim of the construction company in accordance with the legal rights of the respective parties; and we do not find that an estoppel arises against the complainant for having accepted payment for her coupon notes.

We do not overlook the contention of defendants’ counsel that complainants are not in position to complain, for the reason that the payment of this note in the manner in which it was paid, provided for by the resolution of July, 1901, amounted to the surrendering of something of no value for stock of the railway company. The argument is this: That, as the construction company owned all the stock which the railway company had issued up to this time (not all of its authorized issue), the construction company was really debtor to itself, and that no harm was done by the surrender of this $225,000 net note. But the fact remains that from the inception of these two companies, for reasons of their own, the parties formed and maintained to the last two organizations. There was no identity of corporations, nor can the stockholders of one company be said to be identical with the company itself. The rights of the construction company must be determined upon the same principles as though the stockholders wex’e a different set of people.

We think the decree should be reversed, and the vote of July 12, 1901, be declax’ed void and of no effect, and that the $225,000 note be returned to the construction company, and the 2,250 shares of the common stock of the railway company issued in place thereof be delivered u'p and canceled, and that the construction company be dissolved and wound up according to law, and its assets sold and converted into cash, and distributed among the shareholders as their interest may appear; or, at the election of the defendants, inasmuch as complainant is the only complaining party, a decree will be entered for the complainant for her one-sixteenth interest in the $225,000 net note, and providing for a sale of the stock of the railway company held by the construction company, and for the payment to complainant of one-sixteenth of the price at which it sells. The complainants will recover costs of both courts.

The other Justices concurred.


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    FISCHER v. GOLDIE.
    Master and Servant — Personal Injuries — Assumption op Risk.
    A servant who was injured by a hoop thrown out of a planer because of a roller becoming loose in its box, and dropping down on one side, assumed the risk, where it appeared that a millwright repaired the box that morning in the same manner which had been customary for two months previous, and that, after being repaired, it would run for a time, and then drop out again, with which facts the servant was familial-, and that the danger was not concealed.
    Error to Bay; Shepard, J.
    Submitted January 14, 1903.
    (Docket No. 42.)
    Decided March 30, 1903.
    Case by William Fischer against William Goldie for personal injuries. From a judgment for defendant on verdict directed by the court, plaintiff brings error.
    Affirmed.

      T. A. E. & J. C. WeadocTc, for appellant.

      E. A. Cooley, for appellee.
   Montgomery, J.

The plaintiff, a young man, 26 years -of age, was employed by the defendant in planing hoops on a planer constructed especially for that purpose. The machine was kept in repair by a millwright. The base of the machine was made of two cast-iron side frames about 36 inches high and about 8 feet long. A general outline of the top of the machine was that of the top of a table. This top was covered- with brass plates, upon which the material would work easily. There were three sets of rollers, two rollers in each set; the first set called the “feed” rollers, the second set the “receiving” rollers, and the third set the “discharging” rollers. One roller of each set was adjusted above the top of the table, and the other below, the surfaces of the lower rollers projecting through and above the face of the table, so that, when the two rollers revolved, the material fed into them from the front end on top of the table would be carried through and out the other end. Between the feed rollers and receiving rollers there were two knives attached to one' arbor adjusted below the surface of the table, and extending clear across it, a distance of 28 inches. These knives, instead of being smooth as in an ordinary planer, were shaped with a tooth that projected up. The cutting edge of the knife formed the hoops, and the teeth separated them; so that each of the knives was composed of a series of upwardly projecting teeth, and between the teeth a knife surface of about an inch and a quarter wide. The knives were placed one on each side of the arbor, which revolved rapidly at a speed of 4,000 revolutions a minute. The knives were covered by a pressure bar, so that pieces would not fly out, and the mechanism was thus concealed from the view of the workman.

The material which was used on the planer was prepared from elm logs. The log is first steamed, and then slices about the thickness of a hoop are cut off from it. These slices, called “sheets,” are carried by means of a conveyor to the planer, and are pushed through the feed rolls, so that the revolving knives coming in contact with, them plane them and cut them into separate hoops, and the receiving rollers take hold of them and carry them through. The knives extend far enough through a slot in the table to shape, plane, and separate the hoops with a downward stroke. The top rollers were all weighted down at the bearings. The lower rollers worked in solid boxes. The space between the rollers was less than the thickness of a hoop, and in that way purchase upon the “sheets ” and the hoops was secured.

The plaintiff observed that the machine was not working properly about one month before the accident, and the-millwright fixed it. Again the day of and before the accident he called the attention of the millwright to the fact that it did not seem to be working properly, saying to him that the second set of rollers — that is, the middle set, or receiving rollers — would not draw the hoops through. The millwright, who was charged with the duty of keeping the machine in repair, and who represented Mr. Goldie, — Mr. Goldie not being present, — said he would fix the machine. The millwright went and looked at it, attempted to fix it, said it was all right, and to go ahead with the work. The plaintiff went ahead, and, after putting certain sheets through the machine, and while leaning over to take up another, one of the hoops which the receiving rollers failed to carry through was caught by the teeth of the knives, forced back through the first set of rollers, struck the plaintiff on the leg above the knee, and ran up his limb, injuring his scrotum and groin, bursting a blood vessel, and doing other injuries, from the effects of which he will never recover.

Plaintiff’s claim is that the' hoop 'was thrown bacjs because the lower of the second or receiving set of roller^ was permitted to drop down in the box on one side, so that the surface of the roller was below the table, and the sheet, as cut into hoops, lay in the machine, and was not carried through, because the rollers in that condition could not perform their function. It is also the claim of the plaintiff that the manner of attempting to repair this box was improper. But it appears by his testimony that it had been the practice for two months for the millwright to fix this box in the same way, and the rollers would then work all right for a time, and then get out of place again; that he spoke to the millwright about the machine a month before the injury, and he repaired the box by driving tins into it; and again on the morning of the injury the same thing occurred. The plaintiff was as familiar with the methods employed by the millwright to remedy the defect as was the millwright himself. He knew the result which had followed on previous occasions. He must have known that it was simply a question of time when the roller would again drop down. There was nothing concealed or hidden in the danger. The whole machinery was open to his observation, and we think the circuit judge committed no error in holding that the plaintiff assumed the risk. Wheeler v. Berry, 95 Mich. 250 (54 N. W. 876); Lamotte v. Boyce, 105 Mich. 545 (63 N. W. 517); Hayball v. Railway Co., 114 Mich. 135 (72 N. W. 145).

The judgment is affirmed, with costs.

The other Justices concurred.


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    CENTRAL SAVINGS BANK v. O’CONNOR.
    1. Bills and Notes — Conditional Delivery — Evidence.
    Parol evidence is admissible to prove that a promissory note, unconditional in terms, was placed in the hands of the payee with the understanding that it should not become a binding obligation until the happening of some event.
    2. Same.
    Parol evidence is inadmissible to introduce conditions or modifications of the terms of a promissory note which has been delivered into the hands of the payee, to take effect presently as the obligation of the maker.
    3. Same.
    In an action upon a note unconditional in terms, given for the purchase price, of a chattel mortgage and note, evidence is inadmissible to show that it was given with the understanding that it should become void if the maker of the chattel mortgage should be declared a bankrupt.
    4. Same — Consideration—Bankruptcy.
    Where a note, indorsed by persons against whom it may be enforced, and a chattel mortgage, are given as the consideration of other notes, the consideration does not wholly fail, though the maker of the former note becomes a bankrupt.
    5. General and Special Verdict — Judgment.
    Where there is no special verdict inconsistent with the general verdict, a judgment non obstante veredicto should not be entered.
    Error to Wayne; Donovan, J.
    Submitted February 3, 1903.
    (Docket No. 66.)
    Decided March 30, 1903.

      Assumpsit by the Central Savings Bank against George M. O’Connor and William J. Hammond on promissory notes. From a judgment for plaintiff non obstante veredicto, defendants bring error.
    Reversed.

      Charles W. Casgrain (E. A. Fink, of counsel), for appellants.

      Barbour & Bexford, for appellee.
   Montgomery, J.

This action is brought upon two promissory notes aggregating $1,523.47, made by the defendant O’Connor and indorsed by the defendant Hammond. The notes bear date February 1,1901. The plaintiff made its case by introducing them in evidence. The ■defendants then offered to show by a parol agreement made at the time said notes were executed, and which is set out in a notice under the general issue, in substance as follows: That the notes were given for the amount of a chattel mortgage which plaintiff held upon the property of the J. R. Pearson Company, which property defendant O’Con-nor had purchased; that the title to said notes never passed to said plaintiff; that the notes were delivered to plaintiff upon the clear and distinct understanding and condition, agreed to by said plaintiff, that in case the said J. R. Pearson Company should thereafter be forced into bankruptcy hy any of its creditors, upon proceedings instituted by them for that purpose, and adjudicated a bankrupt, said notes would thereupon, in the event of the happening of such contingency, become and be null and of no effect, and were not to be paid, and that it was upon said condition said notes were delivered to said plaintiff; and that it accepted and held, and still holds, them, and each of them.

The evidence of the defendants upon this subject, which is most favorable to the defense, is, in substance, this.: That the notes were executed in consideration of the transfer by the plaintiff to the defendant of a chattel mortgage and accompanying note of the J. R. Pearson Company, which note was indorsed by J. R. Pearson, F. H. Crawford, and A. J. Franklin. Defendant testifies that, after the notes were signed and indorsed, he then said to Mr. Fox, plaintiff’s representative:

These notes are delivered to you on the condition that if this concern is put in bankruptcy by reason of any of these creditors petitioning because of this chattel mortgage having been given, or an execution having been levied and the goods sold under the execution, which are both acts of bankruptcy, then the notes are to be null and void; and Mr. Fox says, ‘ That is my understanding of it, and I accept them soand' he says, ‘You know that there is nothing going to be done about it.’ ”

On the trial of the case the court submitted the case to the jury upon the instruction that, if the claim set up by the defense was true, the plaintiff could not recover. The jury returned a verdict for the defendants. Afterwards a motion for a new trial or for the entry of a judgment. non obstante, veredicto was entered, and the court, after consideration, entered a judgment for the plaintiff non• obstante veredicto. The defendants bring error.

The meritorious question is whether the defense set out in this notice is one which can be established by parol testimony. It is doubtless true, as contended by the appellants’ counsel, that it may be shown that a promissory note, unconditional in terms, was conditionally delivered; that is to say, that it was placed in the hands of the payee, but with the distinct understanding that it was not to be operative or to become a binding obligation until the happening of some event. Brown v. St. Charles, 66 Mich. 71 (32 N. W. 926); Burke v. Dulaney, 153 U. S. 228 (14 Sup. Ct. 816). On the other hand, the rule is firmly established that where a promissory note for a certain amount, payable at a certain time, is delivered into the hands of' the payee, to take effect presently as the obligation of the defendant, parol evidence to introduce conditions or modifications of the terms is not admissible. The case of Hyde v. Tenwinkel, 26 Mich. 93, illustrates this rule. It was there held that an attempt to show a verbal contemporaneous agreement to -reduce a note from an absolute and specific promise to a defeasible engagement was inadmissible. The same rule has been followed, one of the recent cases being Phelps v. Abbott, 114 Mich. 88 (72 N. W. 3); Burns & Smith Lumber Co. v. Doyle, 71 Conn. 742 (43 Atl. 483, 71 Am. St. Rep. 235). We think it cleg,r that the present case falls within that line of cases which precludes parol evidence offered to vary the terms of a written instrument. If we adopt the testimony of the defendant as correctly stating the transaction, and more certainly if we adopt the terms of the notice of defense by which the defendant was bound, these notes were delivered to take effect presently, but upon the alleged parql agreement that they were to become void in the event that a certain contingency should happen. This is no more than averring that plaintiff entered into a contemporaneous parol agreement that, while the defendant’s obligation bound him to pay absolutely the sums of money at specified times, yet in a certain contingency this sum should not be payable at all, and the notes be redelivered.

It is suggested, also, that there was a total failure of consideration. This cannot be held, for the reason that there was transferred to the defendant, in consideration for the notes, the chattel mortgage and promissory note of the J. B. Pearson Company, which note had indorsers against whom it would be enforceable. There was no absolute and total failure of consideration, and no defense of partial consideration was noticed under the general issue.

We think, however, that the practice adopted in this case was mistaken. There is no verdict which supports the judgment entered non obstante veredicto. Had there been a special verdict inconsistent with the general verdict, such a judgment might have been proper.

We think the case should be reversed and remanded for a new trial. No costs will be awarded to either party on this hearing.

The other Justices concurred.


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    NICHOLS v. MONJEAU.
    1. Sale by Bailee — Authority.
    A bailee of property has no apparent authority to sell, and devest tlie .owner of his property. Trudo v. Anderson, 10 Mich. 357.
    2. Same — Knowledge op Bailor — Estoppel.
    The fact that plaintiff did not proceed at once to assert his rights to his property by replevin after learning that it was in the possession of one who had purchased it from his baile© does not estop him from recovering it from a subsequent purchaser, where he had no knowledge of an intent of the vendee to further transfer it.
    Error to Baraga; Streeter, J.
    Submitted February 18, 1903.
    (Docket No. 95.)
    Decided March 30, 1903.
    Replevin by Edward Nichols and another against Victor Monjeau. From a judgment for plaintiffs on verdict directed by the court, defendant brings error.
    Affirmed.

      C.F. Button, for appellant.

      Ira F. Randall, for appellees.
   Montgomery, J.

Plaintiffs owned a team of horses. They intrusted them to a teamster, named Baker, to take into the lumber woods, and do teaming. Near the end of the season Baker sold the team of horses to one Conley. Conley kept the horses until about the 1st of April; then sold them to defendant. Plaintiffs’ testimony shows that, while they learned that the team had been sold very shortly after the sale took place, they did not find out who purchased them until in May or June. Early in July they saw defendant, and made a demand for the team, which being refused, this action of replevin was brought. On the trial the circuit judge directed a verdict for the plaintiffs. Defendant brings error.

Baker, having no title, could pass none. Truclo v. Anderson, 10 Mich. 357 (81 Am. Dec. 795). The doctrine of apparent authority has no application to such a case, as the case cited rules that a bailee of property has not the apparent authority to sell, and devest the true owner of his property..

Defendant’s counsel requested the court to charge the jury that, if the plaintiffs knew that the team had been sold shortly after the sale took place, and failed to dis-affirm the sale, they would be estopped from now asserting title as against the defendant, who purchased at a later time. There was testimony on the part of the defendant tending to show an admission of the plaintiffs that they knew, shortly after Conley bought the team, that the team had been sold to him, and the question presented is whether the failure to take prompt action to recover the team estops them. The plaintiffs are not shown to have had any knowledge of any purpose of Conley to transfer the team. They simply delayed bringing an action against him, which they were entitled to do. The case is unlike the cases cited by defendant’s counsel, wherein the doctrine of estoppel was applied to one who has a duty to sneak, knowing that-his...silence will result in another placing himself in a different position. Unless the mere fact that plaintiffs knew of Conley’s possession called upon them to proceed at once to assert their rights by replevin, there could be no room for the doctrine of estoppel. We do not think this is the rule.

The direction was proper, and the judgment will be affirmed, with costs.

The other Justices concurred.


author: Carpenter, J.

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    LUCKING v. BALLANTYNE.
    1. Taxes — Lien—Chattel Mortgage — Priority.
    A charter provision that all city taxes upon personal property shall be a lien thereon until paid, and no transfer of the property assessed shall operate to devest or destroy it, does not give the city a prior lien for taxes over the lien of a chattel mortgage given before the assessment.
    2. Same — Receivers.
    A tax assessed against a chattel mortgagor cannot be enforced against a receiver appointed on the foreclosure of the mortgage, which was given beford^the property was assessed.
    Appeal from Wayne; Donovan, J.
    Submitted February 18, 1903.
    (Docket No. 104.)
    Decided March 30, 1903.
    Petition by Thomas M. Lucking, receiver of taxes for the city of Detroit, against John Ballantyne, receiver of W. J. Gould & Company, to compel the payment óf certain taxes. From a decree for petitioner, defendant appeals.
    Reversed.

      John W. McGrath (Timothy E. Tdrsney, of counsel), for petitioner.

      Henry B. Graves, for defendant.
   Carpenter, J.

Defendant Ballantyne, the receiver in the above-entitled cause, asks this court to set aside a decree rendered by the court below, compelling him to pay the petitioner, the receiver of taxes of Detroit, $1,714.14 for city taxes assessed against the defendant corporation, W. J. Gould & Co., as the owner of the receivership property. The facts are as follows: On February 28, 1902, W. J. Gould & Co. executed and delivered to said Ballantyne, as trustee, a mortgage upon its stock of goods and other personal property, situated in the city of Detroit, to secure the payment of the aggregate amount of 184,740, owing to a number of its creditors. March 1, 1902, said Ballantyne was appointed receiver of the property covered by said mortgage in this suit, instituted for the purpose of its foreclosure. Until July 12, 1902, said mortgaged property was sold in the ordinary course of trade. The balance undisposed of was sold in a lump at that time. The property covered by the chattel mortgage is insufficient to pay all the debts secured thereby. The assessment for the taxes in question was made against W. J. Gould & Co. It is insisted that the decree of the court below can be sustained on two grounds: (l) That the lien created by the law for the payment of taxes is superior to the lien created by the chattel mortgage under which the receiver holds; (2) that the assessment may stand as an assessment against the receiver.

The lien for taxes is given by section 10 of chapter 10 of the charter of the city of Detroit (see Act No. 472, Local Acts 1901), which reads as follows:

‘ ‘All city taxes upon personal property shall be and remain a lien thereon until paid, and no transfer of the personal property assessed shall operate to devest or destroy such lien. ”

It is not necessary to decide whether the tax lien attached April 1st, when the property was listed for assessment, or July 1st, when the tax roll was placed in the hands of the receiver for collection. See Eaton v. Chesebrough, 82 Mich. 214 (46 N. W. 365). The mortgage was given several weeks, at least, before the tax lien attached. The question, then, is, Does the language of the section above quoted make the lien for taxes superior to liens existing when such tax lien takes effect ? Clearly, nothing in the language of the statute would lead to any such conclusion. The provision, “ No transfer of the personal property assessed shall operate to devest or destroy such lien,” unquestionably refers to transfers made after the lien attaches. It does not apply to transfers made before. Such transfers might prevent the lien attaching^, but by no possibility could they “ devest or destroy ” it. The legislature, having in express terms made this tax lien superior to subsequent transfers, clearly indicates, by omitting to specify its effect on prior transfers, an intent that it shall not be superior to them. The argument that the tax lien under consideration is superior to prior liens and transfers, because a tax lien on land is superior to such transfers, assumes a resemblance between taxes on land and taxes on personalty which does not exist. In the case of a tax on land, it may be stated as a general proposition that the land, and not the owner, is taxed. Purchasers and all persons interested in land understand this, and must pay the taxes as a condition of enjoying their property. It is otherwise with personal property. There the tax is against the person, because he owns personal property. It has always been the policy of the law — supposedly in the interest of trade — to make personal property easily transferable, and to secure to purchasers and mortgagees the entire title of the seller and mortgagor. It would be a radical change, indeed, in that policy, if their title is to be destroyed by a tax subsequently assessed against the person from whom that title was acquired. When the legislature intend to make such a change, it is to be presumed that they will indicate that intent by appropriate language. By the legislation in question they have not only failed to indicate it, but they have, as already stated, used language which is inconsistent with any such intent.

Is the tax to be treated as a tax assessed against the receiver ? It is obvious, and it is distinctly contended by petitioner, that W. J. Gould & Co., notwithstanding the mortgage and appointment of the receiver, had a taxable interest in this property. It is obvious, too, that each of the creditors secured by the mortgage in question was liable to taxation for his credit secured by said mortgage. This record does not indicate, nor are we to presume, that such taxes were not paid. If it is also true (and this is a proposition which we by no means affirm) that the receiver was liable to taxation as the owner of an interest in said property, it is sufficient to say that he was under no obligation to pay the tax assessed against W. J. Gould & Co.

The decree of the court below must be reversed, and the petition dismissed.

The other Justices concurred.


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    BEUTEL v. WEST BAY CITY SUGAR CO.
    1. Streets — Vacation—Notice—Damages.
    One who is not entitled to notice of proceedings to vacate a street cannot recover damages of a person for causing it to be closed.
    2. Same — Property Owners.
    One who has no property or private right of way abutting upon a street which has been vacated cannot complain.
    Error to Bay; Connine, J., presiding.
    Submitted October 7, 1902.
    (Docket No. 3.)
    Decided April 7, 1903.
    Case by Robert Beutel against the West Bay City Sugar Company to recover damages ‘for an alleged interference with a right of ingress and egress to a street. From a judgment for defendant on verdict directed by the court, plaintiff brings error.
    Affirmed.

      Hall & Brockway (Morris L. Courtright, of counsel), for appellant.

      T. A. E. & J. O. Weadock (Lee E. Joslyn, of counsel), for appellee.
   Montgomery, J.

The case can only be understood by referring to the accompanying plat.

Prior to February 4, 189.9, plaintiff was the owner of blocks 6, 7, and 8, and A, B, C, D, E, F, and G. On the date mentioned he conveyed to Méndal J. Bialy blocks 6, 7, and 8, and also block A, excepting and reserving from the last description, “for the purposes of a public highway, so much and such parts thereof as would be contained within the line of Martin street if extended through and across the same.” This would be that part marked on the plat “right of way,” extending from the intersection of Boy street easterly to what appears on the plat as Garfield avenue. Prior to this sale the plaintiff had, on a petition filed by him, caused to be vacated Garfield, Grant, Andre, and Sidman streets south of Washington street. The purchase of this property by Bialy was in the interest of the defendant company, and the title was subsequently conveyed to it. The purchase was made for the purpose of establishing a beet sugar plant, and the defendant took measures to vacate Washington street east of Boy street, and the north and south streets intersecting Washington street, and proceedings were had in the circuit court for the county of Bay with this end in view. An order was entered vacating the streets, and the entire property fenced in, and the defendant’s plant constructed thereon.

This action is brought by the plaintiff to recover damages for the alleged interference with his right of ingress and egress to Washington street. The plaintiff claims that the proceedings taken to vacate these streets were irregular; but we regard this question as unimportant, for, if the plaintiff is in position to maintain this action, it must be because he occupies such a relation to Washington street as that in any attempt to vacate it he would be entitled to notice of the proceedings, under the authority of Phillips v. Highway Commissioner, 35 Mich. 15. It is doubtless equally true that, if he occupies a position which would have entitled him to notice of these proceedings, he is entitled to recover damages for the injury to his means of egress and ingress which were interfered with by the closing of the street, unless it shall be held that he is not in position to complain for the reason that -he has other means of egress and ingress through Norwalk street at the east, and through the public way reserved in his deed to Bialy, — a point which we need not, in the view we take of this case, consider.

Andre street is the only north and south street which was ever opened. Evidently, after it was opened, for the purpose of making a crossing, the railway company placed planking at the crossing with Andre street and the railroad track. Since this street south of Washington street has been vacated, this planking has not been removed, and the plaintiff’s testimony is that the railway company has never interfered with the use of the crossing by the public. The plaintiff has no title to any part of Andre street lying within the track of the railway company, and it does not appear that Andre street is a street south of Washington street. The question is whether, under these circumstances, he shows a peculiar damage from the closing of Washington street other in kind from that which other owners of property in the vicinity have suffered.

Both parties rely upon the case of Buhl v. Depot Co., 98 Mich. 596 (57 N. W. 829, 23 L. R. A. 392). In that case it was said:

“A distinction may well be held to exist between the injury which results to an abutting owner, or another so situated that the means of ingress and egress to and from his premises are cut off by a discontinuance of a street, and one owning land upon another street, or on the same street at a distance from the part of the highway discontinued.”

It was further held, in substance, that where the discontinuance of the street left the premises of the plaintiff in a cul de sac, and without means of egress, the plaintiff might assert that he had suffered peculiar damages, and recover them. We have no purpose of departing from this rule. It is also undoubtedly true that, where one has a private right of way connecting his premises with a public way, he may be held to be an abutter on the street by means of the private right of way, and in such case a discontinuance of the public way would work him a peculiar injury. See Phillips v. Highway Commissioner, supra.

Does this case fall within the reason of this rule ? There is nothing in this record to indicate that there is a highway crossing of this railway right of way acquired by sufferance, or that the plaintiff is either a lessee or licensee. He has, it is true, been suffered to use the same since the vacation of Andre street south of Washington street, but that he has acquired any rights as against the railway company or others is not made to appear by the record. We think, therefore, that it cannot be said that this plaintiff is shown in any sense to have property abutting upon Washington street, which has been discontinued. It should be stated that the portion of Washington street east of Andre street it is conceded is not open. It does not appear that the dedication has ever been accepted, nor does it appear that the railway company joined in the attempted dedication.

The circuit judge reached the conclusion that the plaintiff had not shown himself entitled to recover, and this judgment is affirmed, with costs.

Hooker, C. J., Moore and Grant, JJ., concurred.


author: Hooker, C. J.

text:
    THOMSON v. McMORRAN MILLING CO.
    1. Railroads — Transfer of Property — Service of Process-Agents.
    In a legal proceeding against a railroad company which has sold all its property to another company, service of process upon a ticket agent of the purchasing company does not confer jurisdiction, though the agent was formerly ticket agent for the defendant.
    2. Same.
    The provisions of the statute (2 Comp. Laws, §§ 6255, 6340) that, when a railroad oompanj'' conveys its property to another corporation, the rights of pre-existing creditors shall not be prejudiced, and “all rights ofv creditors shall be preserved unimpaired, and the respective corporations shall continue to exist so far as may be necessary to enforce the same,” do not authorize process in a suit against the selling company to be served on an agent of the purchasing company.
    3. Motion to Strike — Appearance.
    A motion to strike from the files a suggestion of claim for mesne profits in an action of ejectment, for want of service and insufficiency, is not equivalent to an appearance, and a waiver of a want of service.

      Certiorari to St. Clair; Thomas, J.
    Submitted October 8, 1902.
    (Docket No. 23.)
    Decided April 7, 1903.
    Ejectment by JohnW. Thomson, Jr., and Kate V. Calder against the McMorran Milling Company, the Chicago & Grand Trunk Railway Company, and the Elint & Per© Marquette Railroad Company. Plaintiffs had judgment against defendant Flint & Pere Marquette Railroad Company, and filed a suggestion of claim for mesne profits. From an order granting a motion to quash the service and strike from the files the suggestion of claim, plaintiffs bring certiorari.

    Affirmed.

      John B. Mcllwain, for appellants.

      Frederick W. Stevens (Charles McPherson, of counsel), for appellee Flint & Pere Marquette Railroad Co. '
   Hooker, C. J.

On January 27, 1899, the plaintiffs obtained a judgment in ejectment against the Flint & Pere Marquette Railroad Company, a corporation, impleaded with two other corporations, who recovered against the plaintiffs. The plaintiffs took a writ of error, and the case is now pending in this court. On January 1, 1900, the Flint & Pere Marquette Railroad Company transferred all of its franchises and railroad property to the Pere Marquette Railroad Company, a new corporation organized to purchase this and other railroad property. On January 8, 1900, the plaintiffs filed a suggestion of damages, and served a copy on defendant’s attorneys in the ejectment case. No rule to plead was entered at that time. On December 6, 1901, a rule to plead was entered, and a copy of the suggestion, with notice of the rule, was served upon one Stewart, the ticket agent at Port Huron of the Pere Marquette Railroad Company, who had been ticket agent at the same place for the Mint & Pere Marquette Railroad Company prior to the transfer, but had been in no sense its agent afterwards.

. The appearance of the defendant was special, for the purpose of moving the court for an order striking from the files the document filed on January 8, 1900, and purporting to be a suggestion of a claim for rents and profits, for use and occupation, and for an order setting aside the service of a copy of such suggestion made upon Stewart on December 6, 1901, upon the following grounds, viz.:

1. Because the suggestion was not filed within one year after the docketing of the judgment.
2. Because no rule to plead was entered at the time of filing the suggestion, or within one year after docketing the judgment.
3. Because a copy of such suggestion, together with a notice of the rule to plead, was not served upon the defendant within a year from the time of docketing the judgment.
4. Because C. A. Stewart, upon whom the papers were served, was not then an agent of the Flint & Pere Marquette Railroad Company, nor a station agent of said company, nor was he in any way authorized to receive such notice or service for the defendant.

This motion purports to be based on the records and files of said cause, and affidavits filed with the motion, which affidavits pertain to Stewart’s relation to the defendant company.

The motion has a double aspect: (1) It is designed to quash the service, and in that respect is similar to a plea to the jurisdiction; (2) it attacks the sufficiency of the suggestion, which it says is ‘ in' the nature of a declaration,” and in this respect it may be said to be akin to a demurrer. The plaintiffs’ counsel seems to have recognized this, and replied with an averment that the suggestion is sufficient in law, and prays for an issue of fact on the question of service. On the other hand, defendant’s counsel claim that the filing of the suggestion within tile time prescribed by statute is jurisdictional, and apparently raised the question upon the ground that the court has no jurisdiction of the subject-matter, and not to question the sufficiency of the paper as a pleading.

The proposed issues were as follows:

“1. Whether said service was made upon any station agent or ticket agent at the station or depot along the line or at the end of said deféndant’s railroad line, or on any other officer or agent, or acting officer or agent, of said defendant.
“2. That said defendant, the Flint & Pere Marquette Railroad Company, be required to show whether since the 1st of January, 1900, it has any agent or acting agent, officer, cashier, secretary, treasurer, or any station or ticket agent, in the city of Port Huron or in St. Clair county, or any person who is acting in that capacity, as representing such officer, agent, ticket or station agent.
‘ ‘ 3. Whether the Flint & Pere Marquette Railroad Company, about January 1, 1900, became consolidated, under the statute, with other connecting railroad companies under the name of the Pere Marquette Railroad Company, a corporation, who entered into the possession and control of all the properties, rights, and franchises of the said Flint & Pere Marquette Railroad Company.
“4. Whether a writ of error was taken out by the plaintiffs against all of the defendants in the above-entitled cause, and service made upon all the defendants of notice of the issuing of the same, in accordance with the rules and practice of the court, and whether the return day of said writ of error has been extended by orders of the circuit court of St. Clair county until January 1, 1902.
“ 5. Whether on the filing of the suggestion of damages January 8, 1900, a copy thereof was served upon the firm of Atkinson & Wolcott, attorneys for the said Flint & Pere Marquette Railroad Company in the above cause.-
“6. Whether proof of service of the notice of issuing of the writ of error was duly filed in accordance with the rules and practice of the court.”

The defendant’s counsel thereupon filed its consent to the first question, with a proposed modification, and alleged that the others were immaterial.

After hearing counsel, the court settled issues as follows :

“1. Was C. A. Stewart, the person on whom the suggestion of damages filed in this cause was served, such an officer, agent, or employé of the defendant, or so connected with its business, on December 6,1901, as that service could be made pn him, and bind the defendant, under the laws of this State?
“2. Whether a writ of error was taken out by the plaintiffs against all of the defendants in the above-entitled cause on January 26, 1900, returnable on the 7th day of March, 1900.
“3. Whether notice of the issuance of said writ of error was served upon all of the defendants in accordance with the rules and practice of court.
“1. Whether proof of service of the notice of the issuance of the writ of error was duly filed with the clerk of the Supreme Court in accordance with the rules and practice of the court.
“5. Whether the return day of the writ of error has been duly extended from time to time by orders of this court. ■
“6. Whether on the 8th day of January, 1900, a copy of the suggestion of damages filed in the above cause was served upon the firm of Atkinson & Wolcott, attorneys for said Flint & Pere Marquette Railroad Company.”

Counsel for defendant took an exception.' Counsel then produced testimony, and the court made a finding of fact and law as follows:

“First. That up to on or about the 1st day of January, 1900, the defendant the Flint & Pere Marquette Railroad Company had owned and operated a line of railroad extending into the city of Port Huron, county of St. Clair, and State of Michigan, and had a ticket office in the city of Port Huron, in said county, and that up to until the 1st day of January, 1900, one C. A. Stewart was employed by and acted as a ticket agent of said defendant tbe Flint & Pere Marquette Railroad Company, and on that date said Stewart ceased to be an agent or to act for said railroad company or otherwise.
“ Second. That on or about the 1st day of November* 1899, the Pere Marquette Railroad Company was incorporated, and in and by its articles of incorporation it recites as follows:
“ ‘ In carrying out the purpose of this incorporation, the company contemplates the purchase of the properties, the rights, privileges, and franchises of the Flint & Pere Marquette Railroad Company, the Detroit, Grand Rapids & Western Railroad Company, and the Chicago & West Michigan Railway Company, and the ownership and the operation of the railroads of said companies as part of the. railroad above described.’
Third. That on or about the 1st day of January, 1900* the defendant the Flint & Pere Marquette Railroad Company sold and transferred to the Pere Marquette Railroad Company, a distinct corporation, all its railroads and property, and that since the 1st day of January, 1900, the railroad and property formerly owned and operated by the Flint & Pere Marquette Railroad Company has been owned and operated by the Pere Marquette Railroad Company ; the same being an entirely new corporation, composed of different stockholders from those constituting the Flint & Pere Marquette Railroad Company.
. ‘ ‘ Fourth. That C. A. Stewart, on whom the suggestion of damages filed in this case was served, was not an agent or officer of the defendant the Flint & Pere Marquette Railroad Company after the 1st day of January, 1900, and was not such an officer, agent, or employe of the defendant Flint & Pere Marquette Railroad Company, or so connected with its business, on December 6, 1901, as that service of the suggestion of damages filed in this cause could be made on him, and thereby bind the said defendant, under the laws of this State.
“Fifth. That on or before the 1st day of January* 1900, thé defendant the Flint & Pere Marquette Railroad Company ceased to be the owner of a railroad, and that since that date the defendant the Flint & Pere Marquette Railroad Company has not at any time transacted a railroad business or operated a railroad.
“Sixth. That a writ of error has been sued out of the Supreme Court, and served upon all the defendants in this cause, in accordance with the rules and practice of ■court.
Seventh. That the writ of error was taken out by the plaintiffs in this cause against all the defendants therein on the 2Gth day of January, 1900, and returnable on the 19th day of March of the same year.
Eighth. That proof of service of the notice of the issuance of the writ of error above mentioned was duly filed with the clerk of the Supreme Court in accordance with the rules and practice of court.
" Ninth. That the return day of said writ of error has been duly extended from time to time by the orders of this court until the 18th day of January, 1902.
Tenth. I also found that the judgment was rendered in the circuit court in said cause on the 27th day of January, 1899, in favor of the plaintiffs against the defendant the Flint & Pere Marquette Railroad Company, and in favor of the other defendants, the McMorran Milling Company and the Chicago & Grand Trunk Railway Company, and against the plaintiffs; that on the 8th day of January, 1900, the plaintiffs filed a suggestion of a claim for mesne profits in this cause with the clerk of this court; that upon the filing of the same no rule to plead to such suggestion was entered.
“ Eleventh. That on December 5, 1901, a rule to plead to such suggestion was entered in the common rule book of this court.
Tioelfth. That on the Gth day of December, 1901, a copy of the suggestion for mesne profits filed in this cause on January 8, 1900, was attempted to be served upon the defendant Flint & Pere Marquette Railroad Company, with a copy of the rule to plead thereto which had been entered on December, 5, 1901, and notice of the entry of •such rule to plead, by serving the- same upon one C. A. Stewart, in the City of Port Huron, St. Clair county, Michigan; said Stewart then being the ticket agent of said Pere Marquette Railroad Company.
“Thereupon, due consideration thereof being had, the court doth find, as a matter of law, that there is no proper service made of such suggestion of mesne profits upon the defendant the Flint & Pere Marquette Railroad Company, such as would bind said defendant therein; and it doth therefore order that the motion be, and the same is hereby, sustained, and that the defendant the Flint & Pere Marquette Railroad Company do have an order of this court striking from the files of this cause the document filed therein on the 8th day of January, A. D. 1900, purporting to be a suggestion of claim for rents and profits, being in the nature of a declaration filed against the Mint & Pere Marquette Railroad Company (erroneously named therein the Flint & Pere Marquette Railway Company) for use and occupation.
“And the court further orders that the service of a copy of such suggestion in the nature of a declaration made upon one C. A. Stewart on the 6th day of December, 1901, be, and the same is, quashed, and that an order to that effect be entered on the journal of this court.
“N. E. Thomas,
“ Circuit Judge.
“Dated this 21st day of January, 1902.”

The formal order entered is as follows, after the caption and title:.

“ In this cause the motion to quash service and to strike from the files the suggestion for mesne profits came on to be heard, and after hearing Frank T. Wolcott, attorney for defendant F. & P. M. .Ry. Co., in favor of, and John B. Mcllwain, attorney for plaintiffs, in opposition to, it is ordered that said motion be, and the same is hereby, granted.
“N. E. Thomas,
“ Circuit Judge.”

Thereupon a writ of certiorari was issued from this court. An assignment of errors appears in the record, which was attached to the return of the circuit judge, which is said to include the records, files, and testimony taken in which rülings and exceptions appear. The remedy by certiorari is not questioned by counsel.

The service did not confer jurisdiction over the person of defendant, for all relations between itself and its former station agent were severed. He was thereafter as much a stranger to it as any third person would be.

Counsel makes the claim that the new corporation is an agent for the old, under the statute providing for consolidation of railroad companies (2 Comp. Laws, §§ 6255, 6279, 6339, 6340), and that service was properly made under section 10468. He asserts that the provisions “that nothing herein contained shall prejudice the rights of pre-existing creditors of the corporation from which such property and rights are purchased or leased,” and “all rights of creditors * * * shall be and hereby are preserved unimpaired, and the respective corporations shall continue to exist so far as may be necessary to enforce the same,” justify the claim that this service is sufficient. We think otherwise. That the transfer ' cut off plaintiffs’ rights against the property of the Flint & Pere Marquette Kailroad Company may or may not be true, but, as long as it is an existing corporation, it is entitled to have proóess served upon itself, rather than upon another, although there may be difficulty in serving process. The Michigan cases cited, viz., Gardner v. Smith, 7 Mich. 410 (74 Am. Dec. 722); Turner v. Tunnel Co., 102 Mich. 580 (61 N. W. 72); Ryerson v. Wayne Circuit Judge, 114 Mich. 352 (72 N. W. 131), — do not go so far as the contention in this case, and no case is cited in which a purchaser has been held to be an agent of the vendor for such purposes.

We are not convinced that the other point is well taken, but think that it should not be passed upon on this record. It is urged that, by raising that question, the defendant waived the question arising over the service. It is clear that such was not the intent of defendant’s counsel, and, if it be true that the court had jurisdiction over the subject-matter, the motion to strike the suggestion should not be treated as equivalent to an appearance.

The order of the learned circuit judge is affirmed, with costs, upon the ground that jurisdiction over the person was not obtained.

Moore, Grant, and Montgomery, JJ., concurred.