text:
    STEWART v. CALHOUN CIRCUIT JUDGE
    1. Intoxicating Liquors — Crimes — Sufficiency of Information — Statutes.
    An information charging respondent with selling intoxicating liquor at retail without license or authority, without having ■ paid any tax and without having a receipt and notice posted, is sufficient under 2 Comp. Laws, §§ 5380, 5385, 5386.
    2. Same — Druggists—Illegal Sales.
    The fact that respondent was engaged in the business of selling drugs would not constitute a defense to such an information. People v. Utley, 129 Mich. 628; Anderson v. Van Burén Circuit Judge, 130 Mich. 697.
    3. Same — Pleadings—Surplusage.
    In an information for selling intoxicating liquors unlawfully, the allegation that respondent was engaged in the business of selling drugs and medicines does not invalidate the information and may be treated as surplusage.
    4. Same.
    Such an allegation in the information does not imply that the
    • defendant was lawfully engaged in business as a druggist under 2 Comp. Laws, § 5381.
    5. Same — Statutes—Retail Sales by Druggist.
    A druggist may sell intoxicating liquors at retail upon complying with the statute governing sales at retail. 2 Comp. Laws, § 5379 et seq.
    6. Information — Sales by Druggist — Prosecution.
    An information against a druggist for selling intoxicating liquors, in violation of the statute regulating sales by druggists, must show that defendant availed himself of the provisions of such statute, by filing a bond.
    Mandamus by Louis E. Stewart, prosecuting attorney, to compel Walter H. North, circuit judge of Calhoun county, to set aside an order quashing an information.
    Submitted December 8, 1908.
    (Calendar No. 23,132.)
    Writ granted May 26, 1909.

      Louis E. Stewart, in pro. per.

      D. Q. Salisbury, for respondent.
   Hooker, J.

An information was filed under the liquor law. A motion was made to quash the information, and this was granted. There being ho other remedy, the relat- or asks a mandamus to compel the court to vacate the order and proceed with the trial.

The record shows undisputed facts, and that the order made involved only a question of law, i. e., whether the information charged an offense under the law. The information charges the defendant with selling at retail intoxicating liquor, without any license or authority; defendant not having paid any tax and not having a receipt and notice posted. Were this all that the information alleged, it would be a good information. Furthermore, the fact that he was engaged in the business of selling drugs would not constitute a defense. We so held in the case of People v. Utley, 129 Mich. 628. See, also, Anderson v. Van Buren Circuit Judge, 130 Mich. 697; Peters v. Eaton Circuit Judge, 153 Mich. 467. But the information charges more. It states that he was “engaged in the business consisting in part of the sale of drugs and medicines.” Had it said that he was engaged in the business of a grocer or hardware dealer, such allegations would be unimportant, and would be surplusage. The same can be said in this case unless the fact that he is alleged to be engaged in the business of selling drugs imports that he has chosen to avail himself of the privilege of giving a druggist’s bond under the provisions of section 5381, 2 Comp. Laws. It does not import this. People v. Shuler, 136 Mich. 161. We conclude, therefore, that the information contains a valid charge against him as a retailer. Sections 5380, 5385, 5386,

It is said, however, that the relator’s contention is that this information contains a good charge under section 5381. This can only be upon the theory that any druggist who sells liquor to be used as a beverage and drunk upon the premises where sold is liable for the penalty prescribed in section 5381, a proposition which is inconsistent with the right of one engaged in such business to become a retailer of liquor under section 5380, a right which we have said that he has. See cases supra. There is nothing that prohibits a druggist from retailing spirits, provided he complies with the law relating to retailers. It was so held in the early case of Luton v. Newaygo Circuit Judge, 69 Mich. 610. That case was here on demurrer, and the court said that the “charge was plainly one of selling at retail without license, or paying a tax as a retail dealer, in liquors.” See, also, People v. Congdon, 137 Mich. 133; Maynard v. Eaton Circuit Judge, 108 Mich. 201; People v. Remus, 135 Mich 630; People v. Robinson, 135 Mich. 511; People v. Shuler, supra. But, if he does not wish to do that, he can avoid it and have a right to sell liquor in a method prescribed by complying with section 5381. If he is to be prosecuted under this section, it must be because he has elected to avail himself of this privilege by filing the druggist’s bond, when he may be prosecuted for a violation of the regulations therein contained, which have special reference to druggists; and, in such a prosecution, it is necessary that the information show that he has so availed himself of the provision of section 5381. This is implied in People v. Utley, supra. See, also, Bishopp v. Hillsdale Circuit Judge, 94 Mich. 461. This question was before us in Peters v. Eaton Circuit Judge, supra, but was not there determined authoritatively.

Whether adruggist who has filed the druggist’sbond, etc., is altogether exempt from prosecution under section 5386, regardless of the character of his conduct, and liable only for such violations and penalties as are to be found in section 5381, is a question not in this case. It is doubtful if it has ever been decided, and we do not intend to imply any opinion on that subject here. It is enough to say that this was a good information under section 5386, but was not under section 5381.

The order quashing the information was erroneous, and should be vacated, and doubtless will be on application, in view of our decision.

Ostrander, Moore, McAlvay, and Brooke, JJ., concurred.


source: Caselaw Access Project

author: McAlvav, J.

license: Public Domain

text:
    MONGER v. NEW ERA ASSOCIATION.

    1. Insurance — Proof of Death — Waiver — Mutual Benefit Associations.
    The refusal of the secretary of an insurance company to forward blanks for proving the death of a member, does not operate as a waiver of a rule requiring such proof to be made, or a denial by the company of the claim, where the reason given for the refusal was that the membership of the deceased had ended prior to his death. Fillmore v. Knights of Maccabees, 103 Mich. 437, and 109 Mich. 13, followed.
    2. Same — Vested Interest — By-Laws—Retroactive Effect— Construction.
    A member of a fraternal beneficiary society cannot be deprived of vested rights under his contract with the company by a by-law enacted subsequently to the issuance of his certificate except by agreement of the parties.
    3. Constitutional Law — Obligation of Contract — Impairment —Vested Rights — Change of Remedy.
    Where no tribunal was provided for by such corporation to adjust claims, and a by-law was enacted subsequent to the execution of the contract of insurance creating such a tribunal, and where the contract contained a provision incorporating in its terms laws thereafter to be legally enacted, the obligation of the contract was not impaired, nor vested rights affected.
    4. By-Laws — Reasonableness—Legality—Mutual Benefit Insurance.
    A by-law creating a tribunal for adjudicating disputed claims, and applying to members having pre-existing contracts, is reasonable.
    5. Insurance — Mutual Benefit Associations — Construction of By-Laws.
    Such by-law operates retrospectively when it appears that it was the plain intention of the association to include all members.

      6. Same — Actions—Exhaustion of Remedies.
    The remedies provided for by the laws of a beneficiary society must be exhausted before the institution of suit.
    Error to Berrien; Coolidge, J.
    Submitted November 11, 1908.
    (Docket No. 178.)
    Decided May 26, 1909.
    Assumpsit by Maria Monger against the New Era Association on a policy of insurance. There was judgment for plaintiff, and defendant brings error.
    Reversed.

      Kleinhans & Knappen, for appellant.

      John J. Sterling (William C. Hicks, of counsel), for appellee.

       Rehearing denied July 15, 1909.

   McAlvav, J.

The plaintiff, as assignee of the beneficiary named in a certain benefit certificate of $1,000, issued to Llewellyn Monger, deceased, by defendant association, a Michigan corporation, brought suit to recover the same. She recovered in the circuit court a judgment for the amount of the certificate. This court is asked to reverse this judgment, principally upon the ground that plaintiff, before resorting to her suit at law, did not have her claim adjudicated in the properly constituted tribunals of the order, and that the court erred in refusing to so charge the jury, and in refusing to instruct a verdict for defendant. Upon the facts which bear upon this proposition there appears to be little or no dispute. They are, briefly stated, as follows: The benefit certificate in suit was issued to Llewellyn Monger, September 1, 1900. He then resided at Benton Harbor, Mich. Later he removed to Waterville in the State of Washington, where he died March 21, 1905. The certificate upon which the claim is based reads as follows:

“ This certificate, issued by the New Era Association, a corporation organized and doing business under the laws of the State of Michigan, witnesseth, that Llewellyn Monger, a member of Branch Board No. 22, located at Benton Harbor, State of Michigan, is, while in good standing in this association, entitled to participate in the benefit and equalizing funds, to an amount not to exceed one thousand dollars, which shall be paid at his death to Ina F. Monger, related to him as wife, subject to all the conditions of the constitution and laws of this association, and liable to forfeiture if. said member shall not comply with said conditions, constitution and laws, and such as may hereafter be legally enacted by this association. This benefit certificate is accepted upon the additional warranties, conditions and agreements printed upon the back of this certificate, which are a part of the same.”

His widow, the beneficiary, assigned her interest in the certificate to the plaintiff, his mother. On July 13, 1905, Mr. Sterling, representing the beneficiary, and now attorney for plaintiff, sent the following letter to defendant:

“Gentlemen: Llewellyn Monger holder of certificate No. 3330, amount one thousand dollars (1,000) in your association, beneficiary of which is Mrs. Ina F. Monger, wife of the insured, is dead. Will you kindly forward me blanks to make proofs of death so that the beneficiary can forward same to you, that your company may pass upon and settle her claim ? Thanking you in advance for these blanks, and trusting that I may receive them promptly, I remain very truly yours.”

Defendant replied July 15th as follows:

Dear Sir: Your favor of the 13th at hand regarding the death of Llewellyn Monger. We inclose the preliminary death notice which you will have B. F. Wells, our local treasurer, fill out and send to this office. Upon the receipt of this notice we will mail the full set of blanks.”

This preliminary death notice, as filled out and signed, reads:

“ Preliminary Death Notice.
“New Era Association,
“ Grand Rapids, Michigan.
Gentlemen: I have to report to you the death of Llewellyn Monger, State of Washington, which occurred some time in early spring 1905. The cause is reported to be accident, which I believe is true.
[Signed] “B. F. Wells, Treasurer.
“Dated at Benton Harbor, Mich., July 18, 1905.”

This notice, on the date it is signed, was forwarded to defendant in a letter, by Mr. Sterling, in which he stated:

“I herewith return same to you, and trust I may receive full set of blanks for proving death of Llewellyn Monger at once.”

Receipt of this notice and letter was acknowledged by a letter of defendant July 20, 1905, signed by the general secretary, in which he said:

“In reply would say that Mr. Llewellyn Monger ceased to be a member of the New Era Association last fall, consequently there can be no claim upon the society.”

These are all the communications which passed between the parties prior to suit brought. The blanks requested by plaintiff’s attorney were never furnished.

The language of the laws of defendant’s association at the time of Mr. Monger’s death was practically identical with the laws of other fraternal benefit orders, as to the tribunals established, and the mode of procedure for adjudicating claims, which have several times been considered by this cqurt. The record shows that neither the beneficiary nor the claimant made any further attempt to bring this claim before the tribunals of the order. Unless we can hold that the action of the general secretary was a waiver of the laws of defendant, or a rejection and denial of her claim, the contention of defendant must be held good, and the case must be controlled by Fillmore v. Knights of Maccabees, 103 Mich. 437,109 Mich. 13; Hoag v. International Congress, 134 Mich. 87; and Harris v. Typographical Union, 144 Mich. 422. We are unable to distinguish the ease at bar in this particular from Fillmore v. Knights of Maccabees, supra. In that case blanks were not furnished, and the executive committee empowered to consider the claim refused to act. The letter in that case refusing claimant blanks stated that Mr. Fillmore was not, at the time of his death, in good standing, and therefore there was no necessity for sending blank proofs of death. This was the reason given by defendant’s general secretary in the case at bar. It was held in the Fillmore Case that the committee had expressly waived proofs of loss. While that case was first before this court upon an appeal in a chancery cause, where complainant sought to set aside a resolution expelling her husband, and to compel payment of a certificate, and later for leave to file a bill of review, the principal question decided was that a beneficiary, unless refused a hearing, or prevented by fraud or oppression on the part of the organization, must exhaust the remedy prescribed by the charter and by-laws before resort can be had to the civil courts.

Counsel for plaintiff do not dispute the legality of a contract wherein the member has agreed to be bound by future legally-enacted laws. They, however,- insist, by cogent argument, that no change which deprives a member of a vested right, or which is unreasonable, can be said to have been legally enacted, which, applied to the case at bar, means that the right which this member had at the time he was admitted to proceed in the civil courts to enforce any claim under his certificate was a vested right, of which he could not be deprived by subsequent enactment. We think that if his rights were of the nature claimed the contention must be conceded as correct. This court has held such to be the law. The most recent case in which the question arose is Wineland v. Knights of Maccabees, 148 Mich., at page 617, in which this court, in discussing the legality of such after-enacted laws, said:

“In so far as arguments have been addressed to the point that the parties to a mutual benefit certificate may expressly agree to be bound by after-enacted by-laws, they are answered in favor of the validity of such contracts by a previous decision of this court (Borgards v. Insurance Co., 79 Mich. 440), and we think by the weight of authority (Boss v. Modern Brotherhood of America, 120 Iowa, 692; Supreme Commandery K. of G. R. v. Ainsworth, 71 Ala. 449; Beach v. Supreme Tent K. of M., 177 N. Y. 100, 105; 1 Bacon on Benefit Society & Life Insurance [3d Ed.], §§ 185-188). See collection of cases in note to Supreme Council Am. L. of. E. v. Champe, 127 Fed. 541, 63 C. C. A. 282. Such an agreement being found, and there can be no doubt that it was made in the present case, the effect of the particular by-law upon the particular member depends upon whether it was one which the association might lawfully make; whether it should be applied retroactively; whether it disturbs vested rights; whether it is reasonable — some or all of which con-' siderations, and others, maybe, notwithstanding the agreement, involved in any case.”

In the change of the laws, of the defendant association, made after plaintiff’s decedent had become a member, no change was made in any specific part of the certificate. The constitution and laws theretofore had been silent as to the enforcement of claims against it. This change provided that all claims must be submitted to the tribunals established within the association to pass upon them. It is a general rule of construction that laws are intended to operate prospectively. This rule is subject to the.exception that, if the intention that the legislation is to operate retrospectively clearly appears, then it will be so construed. We think in this case it may be said that such intention clearly appears. This body voted to amend its governing laws, after it had been in existence several years, in the matter of the adjudication of all claims against it in its own tribunals, thereby affecting every person a member of the association at that time. What the number of members was does not appear, but the certificate number of this member, issued two years previous, was 3,330. That the intention was to exempt all the membership from the operation of this legislation will not be presumed. In fact the contrary intent is- obvious. Before this enactment, as far as the record discloses, there was no provision relative to proceedings to collect claims or losses from the association. A member or beneficiary was left to his remedy in the civil courts. The amendment established a tribunal within the association. No term of the contract was changed. No attempt was made to limit a recovery, or repudiate a contract. A different remedy was provided for the adjudication of claims against the association. If this amendment was in fact a mere change in procedure or remedy, then the change cannot be said to have impaired the obligation of this contract, or plaintiff’s rights under it; nor can the claimant be said to have been deprived of a vested right. 6 Am. & Eng. Enc. Law (2d Ed.), p. 947, and notes; 8 Cyc. p. 916 et seq.

A diligent examination of all the cases available, where the question of after-enacted legislation by mutual benefit associations, and like bodies, has been passed upon, discloses no case where the point involved is identical with the case at bar.

Our conclusion is that this after-enacted legislation was reasonable; that it pertained to, and was within the authority of, the organization to enact; that it did not deprive this member of any vested right. It was binding upon him and his beneficiary, and within the terms of his voluntary agreement with the association. Therefore this claim should have been submitted to the tribunals established by the association. In the case at bar plaintiff did not exhaust her remedy as provided by the laws of the association, to which Mr. Monger had by agreement bound himself. The case at bar and the Fillmore Cases are distinguishable from the case of Gnau v. Accident Ass’n, 109 Mich. 527, which the trial judge relied upon. In the latter case the laws of the association provided for an arbitration to settle a disagreement between the parties. This court held upon that record that the question as to the waiver of a right to arbitrate by defendant was a question of fact, properly submitted to the jury. The court said:

“ It is apparent that there was no request or desire on the part of defendant to have the claim arbitrated. * * * The court very properly left the question of the waiver of such provision of the contract to the jury to determine.”

And again:

The whole correspondence shows a desire to delay the-payment and put the claimant off until the time in which suit could be brought had expired.”

Arbitration was the only method provided in the certificate to settle such disputes. In the Fillmore Oases, as in the case at bar, there had been waiver only of certain proofs of loss, and not of any method of determining liability.

The other questions raised upon this record need not be discussed.

It follows that the judgment must be reversed, and a new trial ordered.

Montgomery, Ostrander, Moore, and Brooke, JJ., concurred.


author: McAlvay, J.

text:
    TABER v. WAYNE CIRCUIT JUDGE.

    1. Mandamus — Judgment—Amending Record.
    The error of the clerk of a court of record, in failing to ente> a judgment rendered by the court, may be subsequently corrected and the judgment entered nunc pro tunc, even after the commencement of garnishment proceedings based on the judgment.
    2. Garnishment — Notice of Judgment.
    The garnishee having no interest in the original judgment is. not entitled to notice of the entry thereof.
    3. Mandamus — Discharge in Bankruptcy — Setting Aside Cognovit.
    An order of the circuit court setting aside a cognovit and staying proceedings thereon, on the ground that the debt had been proved and discharged in bankruptcy, will be vacated on mandamus; it appearing that the party who executed the cognovit was guilty of long delay in making the motion, and knew when he executed the cognovit, subsequent to the adjudication in bankruptcy, the purpose for which it would be used.
    4. Discharge in Bankruptcy — Waiver.
    A discharge in bankruptcy is personal and may be waived by executing a cognovit, after the adjudication of bankruptcy, to be used in obtaining a judgment as a basis for certain garnishment proceedings.

      5. Practice — Motion to Vacate — Suit Pending.
    Questions pending adjudication between the same parties in a suit in chancery may not be determined on a subsequent motion, in a different court, to vacate a cognovit on which judgment had been rendered.
    Mandamus by Lydia Starr Taber to compel Joseph W. Donovan, circuit judge of Wayne county, to correct a judgment entry, and to vacate an order setting aside a cognovit.
    Submitted December 21, 1908.
    (Calendar Nos. 23,116, 23,133.)
    Writs granted May 26, 1909.

      H. H. Hatch, for relator.

      Jasper G. Gates, for respondent.

       Removed by writ of error to United States Supreme Court.

   McAlvay, J.

These two applications for writs of mandamus may be considered together. The history of the litigation involved in this suit, and a companion suit of like character, begun at the same time, and in which exactly the same proceedings were supposed to have been had, will be found in Starr v. Whitcomb, 150 Mich. 491. To avoid unnecessary length in the decision of these motions, the opinion in that case may very properly be included as a part of this opinion. By so doing the exact situation at the time the case was sent back to the circuit court for the trial of the issue to be joined will be understood.

The garnishee defendant made disclosure in both cases, and an issue was joined, and the cases were ready to be tried. It was then discovered that the plaintiff in the case which was before this court, Mary B. L. Starr, hadrecently died. All the parties and their attorneys, in order to avoid the delay necessary to procure the appointment of an administrator, stipulated in writing that the companion case, wherein petitioner is plaintiff and the same parties principal defendant and garnishee defendant, might be substituted for the other case. Pursuant to these stipulations, the trial of the equity case referred to in the opinion, supra, and the garnishment case, came on to be heard together before the court without a jury, Hon. Byron R. Erskine, circuit judge presiding, and had proceeded until complainant had rested in the equity case and this petitioner as plaintiff had introduced all her evidence in the garnishment case except certain records, when it was discovered that the clerk of the court had failed to enter of record in the principal case the judgment rendered in her favor and against the principal defendant, upon the cognovit which had been duly filed and entered, having on August 22, 1905, duly entered the judgment in the other case and in petitioner’s case a memorandum in the blotter or “short book ” kept by him: “ Judgment for plaintiff entered. Fee paid $2.00.” The clerk, instead of* the judgment entry, had later, on August 26, 1905, copied at length in the journal the cognovit, followed by the words “ Entered nunc pro tunc as of August 22, 1905.” Plaintiff at once moved the court for an order to correct the court journal and to enter a judgment upon such cognovit, nunc pro tunc, as of August 22, 1905, and also a stay of execution as agreed upon. The garnishee defendant alone objected. The presiding judge directed the motion to be heard before respondent, who had presided at the time the judgments were rendered. This motion was at once made; the garnishee again objecting, upon the grounds that he •had received no notice when the judgment was rendered against the principal defendant, and that the principal defendant had been adjudicated a bankrupt. Respondent denied the motion on the ground that the garnishee had not been heard. A motion was then made by petitioner before presiding Judge Erskine to adjourn the trial of the garnishment case to give an opportunity to correct the journal and procure a judgment entry against the principal defendant. The garnishee defendant then moved for a judgment in his favor for want of such judgment. This motion was denied, and the court announced that the case had proceeded upon the theory that a judgment existed against the principal defendant, and that knowledge of the fact that no judgment had been entered came as a surprise to counsel for both parties, and granted plaintiff’s motion and continued the case to give opportunity to apply for a correction of the record.

Thereupon the first application was made to this court for a writ of mandamus to require the respondent to enter a judgment nunc pro tunc, according to the facts, and also a stay according to the terms of the cognovit. The circuit court, Judge Erskine presiding, was notified of this application. Afterwards, while this application was pending in this court, to the knowledge of counsel for garnishee defendant, said counsel secured from the principal defendant a petition which sets up at length all of the facts in this suit relating to the cognovit and the entry in the clerk’s blotter called the “short book,’’which states: “Judgment for plaintiff entered. Eee paid $3.00.” Said petition also sets up at length the bankruptcy proceedings, the proof of plaintiff’s claim, and the discharge. He also appoints garnishee defendant’s attorney his attorney to take all steps necessary for him to set aside said cognovit, short-book entry, and all orders or judgments based thereon, averring that the proceedings in said suit are wholly void for the reason that the same debt proved in bankruptcy is the basis of said suit, and not exempted from a discharge, and by reason of said discharge the debt, cognovit, and entry were vacated and annulled. This petition prayed for an order directing that said cognovit and entry for the reasons stated be set aside, vacated, and annulled, and a perpetual stay of all proceedings in said court in relation thereto be granted. Plaintiff answered at length, alleging, among other things: That defendant Vaughan, at the time he executed and delivered the cognovit, knew that the proof of claim of plaintiff had been filed in the bankruptcy proceedings in his case; that he understood and agreed to the terms of the cognovit, and it was agreed that plaintiff would make no objection to a belated application of discharge by him; that all these agreements were carried out; and that Vaughan has at no time since it was made ever objected to the cognovit or questioned its binding force and effect. On November 2, 1908, respondent, upon the petition and answer, without further showing, entered an order granting the prayer of the petition and setting aside the cognovit and entry and perpetually staying all proceedings in said court and cause based thereon. On the same day petitioner made a motion to vacate this order, which was denied, and the application for a writ of mandamus requiring the circuit judge to set aside and vacate said order is the second application for consideration. The answers of respondent are necessarily very much alike. Practically the same arguments and reasons are advanced in behalf of the garnishee defendant in both motions.

There is practically no dispute upon or denial of the material facts set up in the petitions before us. There is no question but that in both of the suits against the principal defendant cognovits were filed by his attorneys of record, containing the requirement that executions upon the judgments to be entered for plaintiffs should be perpetually stayed. It clearly appears that in both cases on August 22, 1905, judgments were rendered by and before respondent in favor of plaintiffs. In one of these cases judgment was duly entered. In the other case, by some mistake or oversight of the clerk of the court, the judgment was not entered in the journal. There was, however, entered in the blotter of the clerk, called the “ short book,” on that date the following: “No. 45,573, Lydia Starr Taber v. James Vaughan. Judgment for plaintiff entered. Fee paid $2.00.” How and when this error was discovered has already been stated. At once the parties suspended the trial of the cases before Judge Erskine and appeared before respondent with a motion to correct the record and enter a judgment nunc pro tunc. The reason given for refusing this motion was that the garnishee defendant had no notice of the judgment and was not represented.

This garnishment proceeding was begun after judgment recovered and is founded upon it. We cannot understand what rights the garnishee defendant had at that time. He appeared before respondent by counsel upon this motion and objected, for the reason that his client at the time had no notice of the entry of the judgment, and also that the principal defendant had been adjudicated a bankrupt. This motion was not one asking for a judgment, but to correct a record according to the fact to show the entry of a judgment duly rendered August 22, 1905. From the stipulations and acts of the parties in substituting this case for the Starr Case, upon the death of that plaintiff, and from the garnishee defendant’s answer, it clearly appears that this garnishee defendant proceeded upon the assumption that judgments had been rendered in both cases. The discovery that in this case the judgment had not been entered in the court journal was a surprise to all connected with the case. There was no dispute as to the facts presented by the motion. The second objection of the garnishee defendant was not passed upon by respondent. The bankruptcy of defendant Vaughan was relied upon in Starr v. Whitcomb, supra, by the garnishee defendant in urging that the garnishee proceedings be quashed. That contention was overruled by this court after mature consideration of the case presented. There was no substantial ground upon which to predicate the action of respondent. The denial of this motion was an abuse of judicial discretion. The remedy applied for is the only adequate one open to petitioner.

The circumstances upon which the second application for a writ of mandamus was made necessary have already been stated. The practice indulged in by one of the attorneys for the garnishee defendant to appear for defendant Yaughan in the principal case, without a substitution of attorneys, is not to be commended; and the action of the same attorney in taking this proceeding to set aside the cognovit and the record of the judgment in the “ short book,” with knowledge that application had already been made, and was then pending in this court, for a writ of mandamus to require respondent to enter a judgment nunc pro tunc, in the same case, is most unusual, especially when such action could have been taken for no other purpose than to destroy the effect of any determination by this court in the mandamus proceeding.

No claim is made that the cognovit was secured by fraud or mistake. In fact the contrary appears in the petition. No claim is made that the cognovit or the judgment rendered upon it was to be used in any other manner than that prescribed by its terms. No excuse whatever is offered to account for the delay in questioning its validity. Judgment was rendered upon the cognovit August 22, 1905, and the petition to set aside the cognovit was filed October 27, 1908. This was in fact a petition to vacate and set aside a judgment after the party in whose favor it was rendered, relying upon it, had prosecuted the garnishee suit. The defendant Yaughan should have pleaded the matter within his knowledge now set up in his petition in defense of the action, if he intended to rely upon it. To interpose the defense of bankruptcy is a personal privilege which may be waived. This he did by executing and delivering this cognovit. Under the facts above set forth, he must be held guilty of laches, which he in no way attempts to excuse or explain. By his petition he shows no interest in the subject-matter of the suit, and no possibility of any prejudice to him or his interests, arising by reason of such cognovit and judgment. The questions as to the effect of the bankruptcy proceedings and the part plaintiff has taken in them are by the order of this court now being litigated in the equity case brought by the trustee in bankruptcy against Whitcomb, and the garnishee case brought against the same defendant. In those cases the rights of the creditors and of the garnishee defendant Whitcomb will be determined.

The petition of defendant Vaughan, for the reasons above given, should have been denied. It was without merit both in fact and. in law. Granting it was not the exercise of a reasonable judicial discretion on the part of respondent, but amounted to an abuse of such discretion.

Writs of mandamus will issue in both motions in accordance with the prayers of the several petitions.

Blair, C. J., and Grant, Montgomery, and Ostrander, JJ., concurred.


author: Hooker, J.

text:
    PEOPLE v. DETROIT UNITED RAILWAY.
    1. Constitutional Law — Municipal Corporations — Street Railways —Regulation—Impairment op the Obligation op Contracts — Franchises.
    An ordinance requiring a street railway company to run cars by a continuous route on separate lines which intersect, and effecting an unnecessarily frequent schedule on parts of the line, and an infrequent schedule on other parts, is an impairment of the franchise of the company in which a clause was incorporated providing for transfers at the intersection, fixing the fare for a continuous trip over either route, and providing that the fare should not be reduced.
    2. Street Railways — Ordinances—Reasonable Regulation.
    A clause in the franchise of a street railway company reserving to the municipal common council the right to make such reasonable rules as may be deemed necessary to protect the interests, safety, welfare, or accommodation and running of cars for the public, does not authorize the enactment of an ordinance requiring a change of route over intersecting lines, and depriving the company of an extra fare from transferring passengers to other lines.
    Certiorari to the recorder’s court of Detroit; Connolly, J.
    Submitted January 8,1908.
    (Docket Nos. 7, 9.)
    Re-argued February 8 and 9, 1909.
    Decided May 26, 1909.
    The Detroit United Railway was convicted of the violation of certain ordinances, and sentenced to pay a fine of $50.
    Reversed.

      John J. Speed (Charles D. Joslin and John C. Donnelly, of counsel), for appellant.
    P. J. M. Hally and Bernard Weadoclc (Timothy E. Tarsney, of counsel), for the people.
   Hooker, J.

This record involves two appeals from convictions of the defendant under an ordinance of the city of Detroit. The defendant is a street railway company operating the tracks covered by these cases, constructed under franchises granted by the city on December 4,1894, to Greene Pack and others. That ordinance authorized them to construct and operate street railways on various streets mentioned therein. We have to do with but two of them. One is called the “Cross-Town Line,” and runs substantially east and west, the other started at the northerly city limits going south on Fourteenth and other streets to the center of business, and thence, in a roundabout course, it returned to the northerly limits of the city, forming a U-shaped route, crossing the Cross-Town line practically at right angles. These are for convenience denominated the “ Warren Avenue line ” and the “ Fourteenth Street line,” respectively. The ordinance provided for free transfers at these intersections, and the franchise was granted for 30 years, with a right to charge fare as follows: Five cents for a single and continuous trip in any direction “over any one of the routes described,” with the right to a transfer check good for a ride “over any other line or route if presented on the next regular car of such other route,” etc. The ordinance also provided that “ the rates of fare as above provided shall not be reduced during the period of this ordinance without the consent of the grantees, their successors or assigns,” and section 11 provides that:

“The powers, privileges and rights conferred and obligations imposed by this ordinance shall be deemed a contract, and continued to said grantees, etc., for the period of thirty years from and after the date of its adoption.”

Section 19 provides :

“ Whenever the common council shall decide that the establishment of a new route or the extension of any street railway line is necessary for public convenience and accommodation, it shall properly designate said route or extension and the terms and conditions under which it shall be constructed and operated, and shall offer the same to the grantees of this ordinance, giving them thirty days in which to accept the same and file a bond in the sum of ten thousand dollars for the construction thereof, and if accepted within the said period said grantees shall have one year thereafter in which to construct and put into operation said new route or extension.”

Section 17 provides:

“Theright is hereby reserved to the common council of the city of Detroit to make by ordinance such reasonable rules as may from time to time be deemed necessary to protect the interests, safety, welfare or accommodation, and running of cars for the public in relation to said railways ; provided further, that the cars on each and every route shall be run not further apart than ten minutes, excepting between the hours of 10 p. m. and 5 a. m.”

In 1904 the common council passed an ordinance entitled:

“An ordinance to regulate the running and operation of street cars on streets, within the corporate limits of the city of Detroit, to promote the public safety, and to repeal all ordinances or parts of ordinances inconsistent herewith.”

This is an ordinance of 20 sections, and contains many regulations. Among other requirements, it seeks to compel defendant to establish a new continuous route which embraces the Cross-Town line west of Fourteenth street on the Fourteenth street line south of Warren avenue, and it prescribes a penalty for noncompliance. These cases are prosecutions under this ordinance.

In my opinion there is little excuse for the prosecutions, of which the two involved in this cause are samples. Under the most elementary principles, and by the express terms of the ordinance, the defendant secured contract rights under the ordinance of 1894 to run two lines of street railway, one a cross-town line, and another running at right angles therewith, agreeing to give transfers at intersecting points. Now it is proposed to compel them to do more than this. They are asked to establish an additional route by putting on cars whose route shall be a combination of portions of both of said original routes. The effect would be to compel an unnecessarily frequent schedule on parts of the lines, or an infrequency of cars upon other parts, which would be likely to result in a greater inconvenience than the present method of transferring passengers. Furthermore, it would deprive defendant of its right to collect a second fare from passengers who should transfer to other lines intersecting Fourteenth street. The claim that the ordinance, in section 17, reserved power to the council to regulate the running of cars, is not overlooked. It would be an extraordinary stretch of judicial legislation to hold that either party supposed or intended that the council should have power to impose such duties and obligations on the company, which still has, and until the expiration of its 30-year franchise, will have, the right to run a cross-town line with transfers at Fourteenth street, and the duty of running cars upon the proposed route will have to be deferred until such time as the city may be able to make a contract for such service. See 2 Comp. Laws, § 6447.

The ordinance is an infringement of the constitutional provision regarding the impairment of contracts. See Cooley on Constitutional Limitations (7th Ed.), p. 278, and cases cited.

The judgment should be reversed, and no new trial ordered. The defendant should recover costs of both courts.

Blair, C. J., and Grant, Montgomery, Ostrander, Moore, McAlyay, and Brooke, JJ., concurred.


text:
    MATTHEWS v. JOANNES BROS. CO.
    1. Insolvency— Bankruptcy— Preferences— Fraudulent Payments.
    Money paid by an insolvent firm to creditors who have reason to believe that it is insolvent and the payment would operate as a preference, is recoverable in assumpsit by the trustee in bankruptcy, under chapter 487, 32 IT. S. Stat. § 13, passed February 5, 1903, amending the Bankruptcy Act.
    2. Bankruptcy — Preference—Notice.
    Knowledge that the assets of a firm exceeded the debts by only a small margin, as estimated by the members of the firm, and that it was unable to raise the amount due the creditor without mortgaging the assets, constitute sufficient notice that the payment will operate as a preference.
    3. Trial — Harmless Error — Instructions.
    In such case it is harmless error to charge the jury that plaintiff could recover if the defendant knew such facts as would have put a reasonably prudent man upon inquiry as to the insolvency of the debtor.

      Error to Delta; Stone, J.
    Submitted January 7, 1909.
    ( Docket No. 13.)
    Decided May 26, 1909.
    Assumpsit by Stanley M. Matthews, trustee in bankruptcy, against Joannes Brothers Company for money received in fraud of the bankruptcy law. There was judgment for plaintiff, and defendant brings error.
    Affirmed.

      A. H. Ryall (P. H. Martin, of counsel), for appellant.

      F. D. Mead, for appellee.
   Hooker, J.

On August 18,1905, the defendant, being then a creditor of a firm called Martin & Marks, received from them in full of their indebtedness to it the sum of $1,814.50. On the 19th of September following a petition in bankruptcy was filed against Martin & Marks in the Federal court. This was contested, and upon May 3, 1906, it was adjudicated that they were bankrupts as alleged in the petition, and Stanley M. Matthews was appointed trustee in bankruptcy, and as such he has brought this action to recover said sum as paid in fraud of the bankruptcy law. Upon a trial, a verdict and judgment were rendered for the plaintiff, and the defendant has appealed.

The question made most prominent in appellant’s brief arises upon the charge of the court relating to the bona fides of the defendant in receiving the payment sued for. The brief states the point thus:

“ The court told the jury, in effect, that (a) actual knowledge of the debtors’ insolvency, or (&) reasonable grounds to believe the debtor insolvent, the equivalent of actual knowledge, is sufficient to avoid the payment. Thus far we find no fault with the charge. But the court went a step farther, and charged that: Knowledge of such facts as would have put a reasonably prudent man upon inquiry would invalidate the payment.’ ”

It is criticised as follows:

“ We deny that the doctrine of reasonable prudence, stimulating inquiry, that may lead either to actual knowledge, or knowledge of the existence of facts and conditions that would produce a reasonable belief in the insolvency of the debtor, has any place in the bankruptcy legislation. We deny that any man, whether a prudent man or not, is bound to assume any burden of inquiry whatsoever concerning his debtor’s solvency before accepting payment of his debt. The inhibition found in the bankruptcy law against payment of one’s debt is a limitation upon a legal and natural right. It should not be extended beyond the letter of the law; and nowhere in the bankruptcy law can the duty of making inquiry be found. It simply avoids a payment made by the insolvent when the creditor knows, or then has reasonable grounds to believe, the debtor insolvent. What meaning can the term ‘reasonably prudent man’ have in this connection? What ‘ inquiry ’ and how extensive shall it be ? By what standard shall these questions be determined ? ‘Reasonably prudent man ’ is a meaningless phrase unless used in reference to specific duty. The duty here contemplated is inquiry. But where is the authority for imposing any such burden or duty? It cannot be gratuitously cast upon the creditor, and it is not found in the terms of the statute.”

The following facts were undisputed: Joannes Bros. Company sold goods regularly to Martin & Marks until late in July or early in August, 1905, through Walter Hews, who was their traveling salesman and authorized collector. He visited Martin & Marks regularly every week or two during the period of their dealing. He was interested in the collection of this account, being liable under his contract with defendant for one-half of the loss, if not collected. On August 10th Hews received a check for $800, which was the amount then due on this account, leaving $1,014.50 to fall due later. The check was dated August 13th. It was not paid when presented, and was protested prior to August 18th, .for nonpayment. On August 18th defendant’s president, who had charge of its collections, met Hews at Eseanaba by arrangement; one of the objects being to see Martin & Marks. They met Martin, and went with him to see Ryall, an attorney, at Martin’s suggestion. Martin made an excuse for his failure to provide for the check. Defendant’s president suggested that Martin borrow the money to pay its bill, and that his brother P. J. Martin might aid him to secure it. Martin objected to asking him. They saw him, however, and did ask him, and he refused to do so. They then went to the bank, where the banker refused to loan money on a chattel mortgage on Martin & Marks’ stock, etc. Previous to the visit to P. J. Martin, Joannes, defendant’s president, asked Martin for a statement of the assets and liabilities of the firm, and Martin stated that the stock at cost would inventory $1,500, their fixtures, horse, and wagon, $1,000 at alow estimate, and their book accounts at $1,200, besides some real estate which was incumbered, and some book accounts which he considered doubtful, aggregating about $300, and that their debts aggregated $2,500 or $2,600. It is obvious, therefore, that at the best there was a margin of only $1,000 above debts, and that, only upon the theory that upon sale the goods should net cost, the horse and wagon sell for the estimated value, and the accounts be collected without cost or shrinkage. See Coder v. Arts, 152 Fed. 943, 82 C. C. A. 91 (15 L. R. A. [N. S.] 372). Finally, an arrangement was made, ■by which Ryall, an attorney (now defendant’s attorney in this and other litigation), took»a chattel mortgage upon the entire stock and fixtures, horse, wagon, etc., of Martin & Marks, and an assignment of all accounts to secure six notes given by them to said Ryall, aggregating $1,814.50, the exact amount of plaintiff’s claim due and to become due. Ryall thereupon obtained that sum from the local bank upon his own paper, secured by a deposit of the mortgage and the accompanying notes as collateral. These were due as follows: $200, August 23d; $200, September 7th; $500, September 14th; $200, September 20th; $500, October 14, 1905; the remaining October 20, 1905. The usual provision for seizure in case the mortgagee should feel insecure was inserted. The money thus secured was then and there paid over to the defendant’s president. We have no hesitation in saying that this showing was ample to have justified the instruction to the jury that at the time of payment the defendant’s president and agent had reason to believe, if they did not know, that the firm of Martin & Marks was insolvent, and that the payment would inevitably result in a preference over other creditors. It is therefore unnecessary to discuss the point raised upon the instruction referred to. See Coder v. Arts, supra.

Defendant’s counsel contended that the question of insolvency was open, but, as they state in their brief, that “now it turns out that the indebtedness of Martin & Marks was considerably in excess of the amount stated, sufficiently so to render them insolvent,” we treat that fact as proved. They also seem to concede that the adjudication in bankruptcy settled that fact.

Insolvency being conceded, and reason to believe that it existed, together with the fact of preference being conclusively proved, there is no occasion to discuss other questions, with the exception of that arising upon the overruling of defendant’s demurrer. The declaration contained two counts, and a plea was filed to the first and a demurrer to the second. The question seems to hinge on the sufficiency of the count to support the claim that the adjudication in bankruptcy was conclusive upon the question of preference in this case, this transaction being the express ground upon which Martin & Marks were adjudicated bankrupts. The declaration was ample to support the finding of a preference upon proof outside of the bankruptcy record, and it therefore becomes unimportant to inquire whether such record proof was admissible for that purpose under the second count, and the question raised by the demurrer need not be determined.

The judgment is affirmed.

Blair, C. J., and Grant, Moore, and McAlvay, JJ., concurred.


author: Per Curiam.

text:
    GASKILL v. WEEKS.
    Motions — Supreme Court Practice — Res Adjudioata.
    On motion to correct a decree entered in the Supreme Court, held, that the questions raised were determined in Gaskill v. Weeks, 154 Mich. 223.
    Bill by Mary H. Gaskill and others against Eugene J. Weeks, Charles C. Bloomfield, and Thomas A. Wilson, executors of the last will and testament of Chester Warriner, deceased, and others, for an accounting, and for a construction of said will: On motion of defendants for a modification of the decree entered.
    Submitted January 12, 1909.
    (Calendar No. 22,397.)
    Motion denied May 26, 1909.

      Wilson & Cobb, for the motion.

      D. P. Sagendorph, contra.
   Per Curiam.

Motion is made for the reformation and

correction of a decree granted in this court upon an appeal by complainants upon two grounds:

(1) On account of a mistake made in computing interest upon certain assets.

(2) On account of mistake made in the date fixed from which interest was computed.

Without determining that these questions may be raised in this manner, we will say, for the purpose of disposing of this case and avoiding further delay, that these matters were considered and determined at the time the case was decided in this court, as appears from the decision. 154 Mich. 223. For the purpose of avoiding further delay, and that a final distribution of the assets of this estate may be had, and to guide the parties and the court below, to which the case was remanded, attention is called to the purpose of the remand as expressed in the decree. It was to take “such steps as may be necessary for the purpose of distributing the stocks and property which make up the amount hereby decreed to be divided.” The court did not contemplate that judicial proceedings would be necessary; but to save expense to the litigants, and to relieve this court from attending to the details of the distribution, the remand was made. We can see no necessity for further delay. The cash on hand maybe distributed at once, and a tender by complainants of proper assignments and re-, leases of all their interest in the other assets should entitle them to the balance of their share in the estate as fixed in amount by the decree. Such amounts, and none other, will be taken as the basis of the distribution.

The motion is denied.


text:
    JOHNSON v. DESMOND CHEMICAL CO.
    1. Master and Servant — Negligence—Assumed Risk — Warning and Instructing Servant — Obvious Dangers.
    Defendant’s negligence in failing to warn plaintiff of the danger involved in lifting and moving a heavy car raised on a jack, onto the rails of a tramway by using a crowbar, and in failing to instruct him of the proper means to avoid the same, was a question of fact, where it appeared that plaintiff was working outside his usual employment, and was inexperienced, and that an inexperienced man would be likely to have used the means employed by him.

      Ü. Evidence — Necessity eor Warning — Probability oe Danger-Opinion.
    Testimony tending to show that inexperienced men would be apt to employ the method employed by plaintiff is relevant to show the necessity of instructions and caution.

      3. Trial — Directing Verdict — Presumptions—Practice—Evidence.
    On demurrer to the evidence, all the testimony offered must be given the construction most favorable to plaintiff.
    4. Master and Servant — Assumption of Risk —Obvious Danger.
    The danger of the work done by plaintiff was not, as a matter of law, obvious to a man of his experience and intelligence.
    5. Contributory Negligence — Obvious Dangers — Directing Verdict.
    A servant who is not sufficiently experienced to appreciate the danger of his work, is not, as a matter of law, guilty of contributory negligence for doing it in a dangerous way.
    Error to Grand Traverse; Sessions, J., presiding.
    Submitted January 20, 1909.
    (Docket No. 133.)
    Decided May 26, 1909.
    Case by Prank W. Johnson against the Desmond Chemical Company for personal injuries. There was judgment for defendant on a verdict directed by the court, and plaintiff brings error.
    Reversed.

      George C. Brown, for appellant.

      Parm C. Gilbert, 'for appellee.
   McAlvay, J.

Plaintiff brought this suit against defendant for personal injuries received while in its employment at its chemical plant, where it manufactures wood alcohol, acetate of lime, and charcoal. The case has been before the court upon demurrer to plaintiff’s declaration sustained by the trial court, and reversed by this court, and a trial ordered. Johnson v. Desmond Chemical Co., 152 Mich. 84. The case is now here upon writ of error to review a judgment entered upon a verdict instructed by the court, against plaintiff.

In the former opinion the facts connected with the injury, and the negligence of defendant as claimed by plaintiff and alleged in his declaration, are set forth at length, and also his claim that on his part he was free from any negligence which contributed to the injury, and reference is had to that opinion for such statements. Upon the trial, at the close of plaintiff’s case, on motion of defendant, a verdict was directed in its favor upon the case as made by plaintiff, upon the grounds:

(а) That the tools to be used were simple, and the danger obvious. Therefore defendant was not negligent in giving no warning or instructions.

(б) That plaintiff’s negligence caused the injury.

It is claimed that the court was in error in directing a verdict. The action of the court amounts to sustaining a demurrer to the evidence; the result being that, admitting all of the plaintiff’s proofs as true, yet, as a matter of law, the court held that no case had been made. In considering the case, this court must also take all of the testimony on the part of plaintiff as true, and give to the case presented by him its most favorable construction. In this case, then, it is admitted: That plaintiff, an employé of defendant, was taken from his regular employment and ordered to put a derailed tram car back upon the track; that this work was not within the scope of his employment; that he had never before done this work, and was unacquainted with the proper method to perform it, or peculiar dangers attending it; that he was given no instructions how to do the work, or warning of any danger; that in doing this work he was seriously and permanently injured.

At defendant’s plant was a car track built upon a trestle which was elevated 18 feet or more, with an incline leading up to a level portion. Upon this track steel tram cars, which had been loaded with wood and subjected to heat in the retorts leaving only the charcoal, were run from the retorts up the incline onto the level, for the purpose of unloading the charcoal through a chute into box cars on the railroad side track beneath. Each of the cars loaded with charcoal weighs about 5,000 pounds. They were moved up the incline with a horse. The front wheels of the car in question, when nearly up the incline, went off the track on one side, and the hind wheels went off to the other side. The injury occurred to plaintiff while obeying orders to put this derailed car on the track. He had taken a crowbar and a ratchet lifting jack, the usual tools with which to do the work. The car was blocked at the lower end. He had placed the jack under the middle of the west end of the car, and jacked it up high enough, and, it being necessary to move that end of the car a few inches to get these wheels on the track, he placed the crowbar at the side of the car with the point over the rail and pried on it. Immediately the car slipped or dropped down upon the bar in his hands, and plaintiff was jerked forward, and fell over the side of the trestle upon the railroad track below.

Must we assume that plaintiff, under the circumstances, should have known the danger attending this work ? The record appears to us to show the contrary. A witness for plaintiff on cross-examination testified, among other things, as follows:

“I was foreman of the Desmond works. The cars occasionally got off the tracks on the ground. It is a frequent occurrence where I work now. The cars at the Desmond works when I worked there had drawheads. We had no jack at the Desmond works then. We have a jack at the Cummer and Diggins plant. We use a jack and place it under the drawhead of the car, then take a crowbar, place it against the drawhead, and shove the car on the track usually. The purpose of the jack is to raise the car high enough so the sills will clear the track. In using the crowbar after the car is raised up it isn’t necessary to chuck the crowbar clear under the car, just give it a side push. The purpose of the crowbar is not to lift the car. * * *
“Q. If the car had no drawhead, why wouldn’t it be safe to raise the car on the jack and take the lever and push it over by putting the lever at the side of the car, at the end of the car, and pulling it over, provided you are on the ground ?
“A. Because you will tilt your car on the jack, and the opposite side will strike the rail so you can’t shove it over.
“Q. You mean to say that, if the car is sufficiently high for the wheels to clear the track over, the opposite side will strike the rails before the car is in position to come down ?
“A. Yes, sir.
“Q. Now, you have tried that ?
“A. Yes, sir.”
And upon redirect examination:
Q. Would an inexperienced man of ordinary prudence be likely to put a bar against the rail on the side of the car in endeavoring to put it back upon the track when it had been lifted upon the jack?
The Court: You may answer the question, although it would be only in view of the cross-examination that it would be proper at all.
“A. I think it would be the most likely thing fora green man to do, or an inexperienced man.”

This testimony was proper as direct examination on the part of this plaintiff. It tends to show that instructions and cautions were necessary to be given to an inexperienced man put at this work. We cannot say, in view of the facts adduced, as a matter of law, that this work was obviously dangerous to the plaintiff, considering his experience and intelligence.

The facts averred in the declaration, which were held sufficient in law to state a cause of action, are now before us in the form of evidence in the case, not disputed, and of sufficient probative force to require that it be submitted to a jury.

The second reason given by the court for taking the case from the jury, viz., the negligence of plaintiff, was also founded upon the case made by him. It is in fact the logical sequence, of the first conclusion, that no warnings or instructions were necessary. Having already determined that the court was in error in his first conclusion, it follows that the premises upon which he relied were unstable and his second conclusion is necessarily erroneous. The question of plaintiff’s negligence was also a question for the jury.

A consideration of the questions relative to the admission and rejection of evidence is not necessary.

The judgment is reversed, and a new trial ordered.

Blair, C. J., and Grant, Montgomery, and Moore, JJ., concurred.


author: Blair, O. J.

text:
    STOTT v. AVERY.
    1. Specific Performance — Executed Contract — Equity—Real Property.
    The purchaser of a lot in a tract which the vendors represented to be subject to building restrictions may enforce the equitable obligation to sell the remaining property subject thereto.
    2. Same — Statute of Frauds.
    An oral contract for the enforcement of building restrictions executed on one side may be enforced against the other parties in equity.
    3. Real Property — Building Restrictions — Specific Performance — Injunction—Laches.
    A general plan of building restrictions in a district where complainant purchased property, subsequently modified by the vendors in sales known to complainant, without objection from him, and changed in a public auction which complainant attended without protest, and at which he purchased a lot subject to the modified restrictions, will not be enforced in equity to the injury of innocent purchasers.
    4. Equity — Pleading—Specific Performance — Variance.
    In an action for the enforcement of a plan for building restrictions, the representations and agreement charged in the bill of complaint must be proved substantially as averred.

      Appeal from Wayne; Mandell, J.
    Submitted January 22, 1909.
    (Docket No. 98.)
    Decided May 26, 1909.
    Bill by David Stott against George E. Avery and others to enjoin the violation of certain building restrictions. From a decree dismissing the bill, complainant appeals.
    Affirmed.

      Keena, Lightner & Oxtoby, for complainant.

      Walker & Spalding and William H. Wetherbee, for defendants.
   Blair, O. J.

This suit was instituted for the purpose of enjoining the violation of certain building restrictions, or, in lieu thereof, to recover damages for such violation.

In 1890 the complainant contracted for a lot on Commonwealth avenue, south of Calumet avenue, in the city of Detroit. This lot was included in a tract of land platted by Newell Avery and Simon J. Murphy, to whose rights and obligations defendants have succeeded. The tract of the plat affected by this suit is bounded on the south by Grand River avenue; on the west by Avery avenue; on the north by Calumet avenue; and on the east by Trumbull avenue. Commonwealth avenue is immediately east of Avery avenue and immediately west of Trumbull avenue.

The bill avers that the owners of the tract in question, prior to its purchase—

“Entered upon a plan of dividing the said tract of land in such a manner, and of placing the same upon the market for sale upon such terms, and with such restrictions, as would insure to themselves and their grantees, and also to the several purchasers of lots in said tract of land, a first-class residence neighborhood.”

That it appeared from the plat of the tract in question that the lots fronting on Trumbull, Avery, and Commonwealth avenues, “were of the depth of at least 130 feet, and had a frontage of at least 50 feet on either of said avenues (except that a few of the corner lots had a frontage of not less than 45 feet).” That prior to the execution of his contract complainant—

“Was assured by said owners that the lots in said tract of land would be sold only upon the terms, and with the restrictions, which would insure the permanence of said property as a first-class residence neighborhood, and that said premises would be sold only in lots having a frontage of at least 50 feet (except the few corner lots as above stated). That nothing but residences would be permitted on said tract of land, and that no building should be placed within 20 feet of the lot on line of said Trumbull avenue, Commonwealth avenue, and Avery avenue, and that said 20-foot space should be left open for ornament only, and that no other than a single tenement, substantial brick dwelling, should be erected on a single lot, and that the value of any residence to be erected thereon should not be less than the sum of $3,000, and it was represented to your orator, and your orator considered it to be true, that the enforcement of said restrictions upon the said premises (meaning thereby the lots fronting on Trumbull, Commonwealth, or Avery avenues, and especially that portion lying south of Calumet avenue) would largely enhance the value of said lots, and that, on the ground of said restrictions, which were to be enforced as to all of said property, the owners thereof demanded a higher price for their property than it was admitted said property was reasonably worth, were it not for said restrictions.”

That complainant’s contract contained the following provision:

“Article 5. And said party of the second part also agrees to erect and complete within four years from the date hereof, a good and substantial dwelling house of brick on said premises, of the cost and value of at least $3,000 (three thousand dollars) and will not place the same or any other building within twenty (20) feet of Commonwealth avenue, in front of said premises, the object thereof being to secure the erection of a good class of dwellings, and of uniform distance from the avenue in front of the premises. And the said party of the second part further agrees that he will erect or cause to be erected only one single tenement dwelling house on the above-described lot.”

That the consideration for said lot was largely in excess of the reasonable price of other property in that part of the city outside of said tract, and the owners knew that complainant entered into the contract, and agreed to pay such added price, solely in reliance upon the restrictions which he was assured had been enforced as to all property theretofore sold in said tract, and which would be enforced against the remaining lots not disposed of at that time by said owners. Complainant further avers in his bill that about July 1, 1896, he exchanged this contract for a contract upon a corner lot on said Commonwealth avenue, upon substantially the same representations as were made in 1890, the contract for such purchase containing the same restrictions, except as to the value of the dwelling to be erected, which was stated as $8,000, instead of $3,000; “that said provision in said contract was inserted in pursuance with said representations, and upon the understanding that substantially the same restrictions had been, and would in the future be, enforced against all of the property included in said tract;” that no sales of any lot fronting on Trumbull, Commonwealth, or Avery avenues in said tract southerly of Calumet avenue had been made previous to the date of said second contract, without requiring of the purchasers restrictions substantially as above set forth; “ that at the time of the execution of said contract of July 1, 1896, and at the time of the construction of the residence thereon by your orator, no case had arisen of any violation of the terms of said building restrictions within the tract of land above set forth, and that your orator was therefore justified in relying upon the representations and assurances, given to him by the owners of said property as above set forth, that said restrictions would be maintained in the future as to all of said property.”

Complainant further avers that in November, 1905, “and with full knowledge of the restrictions which had, in justice and in equity, by the action and conduct and representations of said owners, and of the various persons through whom they had derived title to said lots; become a part of said premises, or to which said lots had become liable, entered upon a plan” for disposing of, and did dispose of, a number of said lots at public auction sale, without requiring a compliance with said restrictions; ‘ ‘ that quite a number of the lots in said tract of land have as yet not been conveyed by the said owners, but that, as your orator is informed and believes to be true, the said owners threaten and intend to sell and convey the remainder of said lots, without regard to the restrictions upon which the said lots had been held by them and those from whom they derived title, and without regard to the rights of your orator in the premises.”

The bill prays for a temporary and permanent injunction, restraining the defendants—

“ From selling or conveying any of the lots included in the premises above described, except with restrictions substantially the same as those contained in the contracts and deed to your orator, hereinbefore set forth, and also from constructing or completing upon said premises, or upon any lots contained therein, any buildings of any kind in violation of such restrictions; * * * that your orator, by the decree of this court, may be awarded against said defendants, or some one or more of them, such a sum, in addition to the relief hereinbefore prayed for, or in lieu thereof, as may adequately compensate your orator for the damages which he has heretofore or which he may hereafter suffer by reason of the violation of the undertakings, promises, and representations herein-before set forth.”
The case was heard in open court, and at the conclusion of the proofs the circuit judge found against the complainant upon the grounds:
“By reason of the lapse of time complainant is unable to give the exact words of the vendors at the time of the sale, or to show whether the expressed intention of the vendors was the expression of a promise and contract undertaking, or was the expression of a hope and expectation. His testimony, taken in connection with that of the defendants on the subject, will not justify a finding that there was a verbal contract, binding the owners not to dispose of other lots in the subdivision, except under the identical restrictions contained in complainant’s contract and deed.”

The court also found that he was not satisfied from the proofs that the loss in value which complainant’s premises had suffered was due to the acts charged against defendants:

“ It is a well-known fact that all of what is popularly known as ‘inside residence property’ has suffered a diminution in value in the past 10 years; and, in addition to this fact established by the proofs, we have in evidence the opinions of three well-known real estate experts, as against one expert, that complainant has not lost, but that rather he has reaped an advantage through the change in the restrictions. The proofs seem to me greatly to preponderate against complainant’s theory of pecuniary loss through the alleged wrongful acts of the defendants.”

A decree was entered dismissing the bill, and complainant appeals to this court.

Complainant testified in his own behalf that, in his negotiations with reference to the purchase of the lot in 1890, the plat of the property was before them, which showejl the size of the lots to be, most of them, 50 feet, with the exception of one block, where they were 60 feet.

“ It was principally Commonwealth avenue that I was considering. * * * That restriction applied to all the lots on Commonwealth avenue up to Calumet. There was no talk about Trumbull and Avery avenues.”

And again:

“ In my negotiations for my first contract it was represented that other, or the entire section up as far as Calumet avenue, restrictions of like character would apply to each lot, so far as Commonwealth avenue was concerned. I think Avery avenue was to be included in the building restrictions, but they might vary somewhat in value as to Avery avenue. This plat may have included Trumbull avenue, but nothing was said about Trumbull avenue in the discussion with me. * * * I asked them if those were the restrictions which they were going to impose on that entire plat of property, and I was answered, ‘Yes; as far as Calumet on Commonwealth and Avery, as far as Calumet.’ * * * He was going to insist on the building restrictions, as they had been formerly outlined, being carried out.
“Q. And you were told in addition to that that they expected to continue selling on those restrictions ?
“A. Yes, sir.
“Q. And that was substantially the way the thing was' put to you ?
“A. Yes, sir.
“Q. And that statement was never modified at any time?
“A. Not to me; no, sir, not until the time of the auction sale.”

Being questioned by the court as to the exact words used by Mr. Murphy, complainant testified that he said:

“We intend to carryout these building restrictions. From his manner of speech, that he was going to insist upon those building restrictions being carried out on all those lots, I might not have considered the purchase of the lot under any other conditions. We will let other people out, but we will carry out yours.”

The court having intimated that he thought the exact words, or the words that were used, would be important or almost vital, the complainant testified:

“ The words, as I remember them: ‘We are going to insist upon this section being built up.’
“Q. But as to the form of the words which were used regarding that matter, you don’t profess to be positive as to which of the several different forms that you yourself employed in giving an account of the transaction was the’ exact one ?
“A. I don’t; no, sir. It would be impossible.
CiQ. You have told us this morning that the restrictions which you have detailed, which were given you in 1890, you were told applied to Avery and Commonwealth, as far north as Calumet ?
“A. Yes, sir.
“Q. And to those streets only, and did not apply to Trumbull avenue ?
“A. I said no mention was made of Trumbull avenue.
“Q. Nothing was said to you about any restrictions on Trumbull ?
“A. No, sir.”

That he made no complaint as to the construction of houses on Trumbull and Avery avenues which violated the restrictions. That he gave no particular attention to Trumbull or to Avery, because he felt that, if the other neighbors were not injured, he did not think it was his place to interfere.

Defendant Murphy testified:

“For a number of years we had no restrictions upon the property in this subdivision at all. Then we made restrictions: $3,000 house; twenty feet from the street line; single tenement dwelling house, some of brick and some of wood. These restrictions were decided upon, I think, about 1890. We excluded at that time the part above Calumet avenue. * * * We began selling fractional parts of lots when Mr. Grindley became agent in 1894. We did that because we found we could not dispose of the property otherwise. * * * At the time this contract with Mr. Stott was made, I stated that we were restricting the other property, but I never agreed, by word or writing, that we would not modify these restrictions.”

Defendant further testified that there were instances in which they were asked to bind themselves by written restrictions, which they refused to do.

At the time complainant entered into his contract in July, 1896, “the only completed houses on Commonwealth avenue were Mr. Charbonneau’s and Mr. Guenther’s. The Howard houses, I believe, were under construction.” Mr. Guenther’s house was built in 1890 or 1891, costing $8,000 or $9,000. Aside from the complainant’s house and the four other houses mentioned, there were no other houses on Commonwealth avenue prior to the auction sale, which took place November 9, 1905. This auction sale was advertised in the Detroit News, Free Press, and Journal five consecutive days, commencing November 4,1905, and there was also a large signboard, advertising the sale, in view from Commonwealth avenue. The advertisement covered 7,000 feet of vacant property on Avery, Trumbull and Commonwealth avenues between Grand River and Putnam avenues north of Calumet, and represented that the property would be sold in 80, 40, and 50 foot lots. Complainant saw this advertisement several days before the sale, and attended at the auction, and purchased a lot on Commonwealth avenue adjoining his own, which he said he did to protect himself. The restrictions at this sale were stated by the auctioneer several times, and were as follows:

“No buildings shall be used for other than residence purposes. No buildings shall be placed nearer than 20 feet to the lot- line on Avery, Commonwealth, and Trumbull avenues. On Avery avenue north of Alexandrine avenue nothing but a single dwelling house shall be erected on single lots. On Commonwealth avenue nothing but a single dwelling house or two-story apartment shall be erected on interior lots of 30 feet. No double dwelling house shall be erected on interior lots of less than 40 feet. No single dwelling house shall cost less than $2,800. No terrace shall cost less than $2,500 per apartment; no apartment house shall cost less than $1,750 per apartment. No apartment houses on Commonwealth avenue shall be more than three stories high.”

Complainant objected to the owners to the sale proceeding in violation of the agreement as to restrictions, but took no steps to notify the prospective purchasers present of his rights. The sale lasted two or three hours. Complainant further testified that:

“At the auction sale all of the unsold lots in the plat, with the exception of a few in scattered portions of the plat, were sold, and at prices from $25 to $35 a foot.”

He further testified:

“At the time of the sale I understood that sales were to be made on Commonwealth avenue in lots less than 50 feet front, and that apartment houses and terraces were to be allowed to be built, and that the cost of the apartments was to be somewhat less than $3,000. * * * I hadn’t heard anything in the matter of improvements. Particularly I hadn’t heard whether or not the previous building restrictions would be enforced, but it was supposed that they would not be.
“■Q. You supposed they would not be ?
“A. Would not be; yes, sir, from the fact they were selling it at auction. * * *
“Q. How long, as near as you can fix it, before the sale that you got the impression that the old building restrictions would not be enforced ?
ctA. I could not answer that question.
“Q. It might have been a week ?
“A. It might have been a week.
“Q. You hadn’t made any inquiry to verify the truth Of that impression ?
“A. No, sir.”

Complainant contends that, in view of the representations made by defendants or their predecessors in title, an equitable obligation arose binding them, in equity and good conscience, to insert the restrictions in all subsequent deeds made by them, and that such obligation was enforceable by complainant, citing numerous authorities, among others: 11 Cyc. p. 1078; 13 Cyc. p. 716; 3 Pomeroy on Equity Jurisprudence (3d Ed.), § 1295; Kirkpatrick v. Peshine, 24 N. J. Eq. 206; De Gray v. Club House Co., 50 N. J. Eq. 329; Bridgewater v. Railroad Co., 62 N. J. Eq. 276; Evans v. Foss, 194 Mass. 513 (9 L. R. A. [N. S.] 1039); Parker v. Nightingale, 6 Allen (Mass.), 341; Tallmadge v. East River Bank, 26 N. Y. 105; Trustees of Columbia College v. Lynch, 70 N. Y. 440; Lewis v. Gollner, 129 N. Y. 227; Frink v. Hughes, 133 Mich. 63; Harris v. Roraback, 137 Mich. 292; James v. Irvine, 141 Mich. 380.

We understand the bill of complaint and the brief to proceed upon the theory, not that a binding contract was entered into between these parties which was enforceable by an action at law, but that the representations, conduct, and actions of the defendants and their predecessors before and since the making of the contract burdened them and their remaining lands with an equitable obligation. As said in Tallmadge v. East River Bank, supra:

“Selling and conveying the lots under such circumstances, and with such assurances, though verbal, bound Davis in equity and good conscience to use and dispose of all the remaining lots, so that the assurances upon which Maxwell and others had bought their lots would be kept or fulfilled. This equity attached to the remaining lots, so that anyone subsequently purchasing from Davis any one or more of the remaining lots, with notice of the equity as between Davis and Maxwell and others, the prior purchasers, would not stand in a different situation from Davis, but would be bound by that equity.”

Treating this suit as one which, though praying for an injunction, is in the nature of an action for the specific performance of an equitable contract, which, having been entirely executed on the one part, may be enforced against the other parties, it is apparent that the complainant has failed to establish the contract as set forth in his bill of complaint. The bill of complaint alleges the contract or representations to have covered the tract north of Grand River avenue and between Avery and Trumbull, without distinction as to any street within the tract. It appears that in 1896, when the complainant entered into the second contract, numerous lots had been sold in this tract, elsewhere than on Commonwealth avenue, of a width of less than 50 feet, and that buildings which did not comply with the restrictions had been erected. While it is true he claims that he was only interested in Commonwealth avenue, it seems clear that the erection of buildings on Avery and Trumbull avenues near complainant’s lot might have as evil an influence over its value as the erection of buildings at the southern boundary or in the northern part of the tract. At all events, the complainant saw fit to state definitely in his bill of complaint what the representations and agreement actually were; and, having done so, he is required to prove the contract which he desires enforced substantially as stated.

We are not satisfied that the evidence of Mr. Stott is entirely candid with reference to the reason assigned for not adhering to the statement of the agreement as contained in his hill of complaint, but we are of the opinion that he reformed his statement in consequence of the answers of the defendants setting forth numerous departures from the agreement as alleged, which must have been within his knowledge. Brown v. Brown, 47 Mich. 378. We are further of the opinion that complainant by his own conduct has shown himself not to be entitled to equitable relief. It appears from his own testimony that he knew that these lots were to be sold at auction under different restrictions than he claimed he was entitled to enforce against them. He took no steps to forbid the sale, so far as prospective purchasers were concerned, and gave them no notice whatever of any rights which he claimed attached to their property, but, on the contrary, authorized them to suppose that the sale was a legal one from his standpoint by purchasing a lot himself. He waited from the 9th of November until the 30th day of April before filing his bill for an injunction, at which time there was no ground for an injunction; the property having been contracted to innocent purchasers without notice. As stated in Bridgewater v. Railroad Co., 62 N. J. Eq. 276:

“The very object of the courts in raising such implied covenants, and permitting their enforcement by any purchasers under the general plan, is to' secure, not damages to the actor in the enforcement, nor an ascertainment of the proportion of injury done to him, but the specific observance of the general plan for the benefit of all who have purchased the right of that observance.”

It is clear from the testimony in this case that the ascertainment of the damages flowing from the failure to enforce the restrictions is very difficult; complainant’s expert testifying that, so far as the damages due to the failure of maintaining the restrictions were concerned, an estimate was mere guesswork. It might well be said, where the person violating the agreement to enforce the restrictions had done so without the knowledge of the person complaining, or opportunity on his part to enforce his rights by injunction, that he might enforce them by an action in equity, if that were the only action open to him, as we are inclined to think it is; but we do not. think it should be permitted to a complainant who, as in this case, with knowledge that his rights are being violated, and having time and opportunity either to file his bill for an injunction, or to charge all the parties at the sale with notice of his rights, stands by and permits the sale to proceed without notice to the purchasers, so as to render relief by injunction impossible. In such a case we think the complainant is not entitled to recover. Hatch v. Cobb, 4 John. Ch. (N. Y.) 559; Kempshall v. Stone, 5 John. Ch. (N. Y.) 193; Morss v. Elmendorf, 11 Paige (N. Y.), 277; Milkman v. Ordway, 106 Mass. 232-253; Hazen v. Lyndonville Nat. Bank, 70 Vt. 543; Mack v. McIntosh, 181 Ill. 633; 1 Pomeroy on Equity Jurisprudence (3d Ed.), § 237; Lamb Knit-Goods Co. v. Lamb, 119 Mich. 568; Brown v. Gardner, Har. (Mich.) 291; Beal v. Chase, 31 Mich. 490; Perry v. Reed, 147 Mich. 146.

The decree is affirmed.

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