author: Blaie, J. Per Curiam.

text:
    SMALLEY v. McGRAW.
    1. Trial — Direction of Verdict — Propriety.
    The direction of a verdict for defendant before the close of plaintiff’s testimony cannot be sustained unless the testimony offered by plaintiff conclusively negatives his cause of action.
    2. Witnesses — Credibility—Explanations of Testimony.
    In an action against bank directors for damages sustained by the purchase of stock in their bank in reliance on reports as to its condition made by them to the comptroller of the currency it is error not to permit plaintiff’s agent to explain his testimony from which an inference may be drawn that he did not rely upon the reports and to testify to the extent of his reliance thereon.
    3. Banks and Banking — Officers—Liability—False Reports— Purchase as of Stock.
    Where, in an action against bank directors for damages sustained by the purchase of stock in their'bank in reliance on false reports as to its condition made by them to the comptroller of the currency, plaintiff’s agent testifies that he did rely upon the reports, the questions of his knowledge of the making up and the contents of the reports, and of his reliance upon them, are questions for the jury and not for the court, though his testimony is open to the inference that he did not so rely.
    4. Same — Reports—Purpose.
    The object of section 5211, 17. S. Rev. Stat., in requiring reports on the condition of national banks, is to apprise the comptroller and the public of the condition of each national bank at stated periods, and a person contemplating the purchase of stock in a national bank has a legal right to rely upon the published report as a true statement of the financial condition of the bank, without further inquiry, in the absence of knowledge tending to show the unreliability of the statement.
    5. Same — Knowledge of Purchaser — Diligence.
    A prospective purchaser of bank stock, relying on the reports made by the directors to the comptroller of the currency, is not chargeable with knowledge of such circumstances affecting the reliability of the reports as he might discover by the exercise of ordinary prudence and diligence, but only with the natural inferences deducible from the knowledge possessed by him.
    6. Same — Liability of Directors.
    Where directors of a national bank signing a report to the comptroller of the currency knew, or by the exercise of ordinary diligence in the discharge of their duties would have known, prior to signing such report, that the item therein “Loans and Discounts” contained paper worth much less than its face value, which would materially affect the value of the stock of the bank, they are individually liable, under the common law, to a purchaser of the stock who relied in good faith upon such report as stating the true financial condition of the bank.
    ON MOTION FOR REHEARING.
    Courts — Decisions—Control by Other Courts — Federal Question — Rehearing—Law of the Case.
    That the Supreme Court of the United States has decided a case involving the Federal question involved in the case at bar, and reached a different conclusion from that reached by this court, is not ground for a rehearing, where the Federal case, though decided before, was not published until after the State case was decided, and does not touch the principal-grounds upon which the decision in the State case was made; but as to the Federal question involved, the Federal case will be considered to be the law of the State case in all further proceedings.
    Error to Saginaw; Gage (William G.), J.
    Submitted April 4, 1907.
    (Docket No. 8.)
    Decided May 18, 1907.
    Rehearing denied July 13, 1907.
    Case by Margaret A. Smalley against Joseph W. Mc-Graw and Frank P. Chesbrough for fraud and deceit. There was judgment for defendants oñ a verdict directed by the court, and plaintiff brings error.
    Reversed.

      Gillett & Clark and John C. Weadock, for appellant.,

      M. L. Courtright and Humphrey & Grant, for appellee McGraw.

      T. A. E. Weadock, for appellee Chesbrough.
   Blaie, J.

This is a common-law action for fraud and deceit against the defendants as directors of the Old Second National Bank of Bay City, based upon representations of the financial condition of the bank, contained in certain reports to the comptroller of the currency, in reliance upon which plaintiff alleges she purchased certain stock of the bank.

The declaration contained four counts. The first count charged that, at the time of the fraudulent representations relied upon, the capital of the bank had become impaired and its value destroyed by reason of losses suffered by the bank through the discounting of paper for Alzina Maltby (doing business as the Maltby Lumber Company) and W. I. Brotherton & Co.; that defendants, as directors of the bank, fraudulently and knowingly caused and permitted Maltby and Brotherton paper of the face value of $375,000, which defendants knew to be worthless, to remain as an asset at its face value on the boobs of the bank, and to be listed as such in five reports to the comptroller of the currency, published during the year 1903; that this was done for the purpose of giving the stock a fictitious value in the eyes of the public; and that, for the same purpose, the defendants, as directors, declared and paid 5 per cent, semi-annual dividends during the years 1902 and 1903, thereby holding out and representing to the public that these dividends had been earned, and that the capital stock of the bank was unimpaired. This count treats the keeping of false books, the publishing of false reports, and the declaration of unearned dividends as acts “performed by the said defendants acting jointly and in concert and in pursuance of one common purpose and design ” to induce plaintiff and the public to deal with the bank, to buy its capital stock, and to give its stock a fictitious value in the market. The other counts of the declaration merely separate the elements which in the first count are joined together. The first count treats the keeping of false books, the publishing of false statements, and the fraudulent declaration of dividends as all part of one single scheme of fraud. The second count is based only upon the keeping of false books — failing to deduct from the apparent resources of the bank, as shown by its books, so much of the Maltby and Brotherton paper as was known by the defendants to be worthless. The third count bases the action on the publication of a single false report, that of November 17, 1903, which was the last report published before plaintiff bought her stock. The fourth count bases the action upon the fraudulent declaration of dividends at a time when defendants knew the capital stock to be impaired, and with the knowledge and intent on their part that the declaration of these dividends would be accepted by the public as a representation that the capital stock was unimpaired.

The stock was not bought from either of the defendants, and the action is not based upon any privity between the parties either as vendor and purchaser, or as director and stockholder, but upon the duty owing to plaintiff as one of the public. The only fraudulent representations sought to be proved concerned certain paper known as the “Maltby and Brotherton Paper,” which was included at its face value in the statement of “ Loans and Discounts” in the reports.

Plaintiff’s counsel, at the outset, made a statement of what they expected to prove, and, among other things, that on the 30th day of June, 1902, the bank held $430,000 of drafts made by the Maltby Lumber Company upon its customers and discounted at the bank; that at the same time the bank held drafts discounted for W. I. Brother-ton & Co., amounting to $85,000 to $100,000; that investigations were ordered in October, 1902, which showed that:

“ In this amount of drafts I have mentioned $430,000, which was reduced to about $320,000 by the following January; $135,000 worth were actually proved worthless, of no value,' and charged off to profit and loss on the books of the bank. We also expect to show you of tbis "W. I. Brotherton & Co. paper (and I mean by that commercial paper — this bank now have drafts and notes and other paper discounted) the sum of $53,000 was prior to 1906 actually charged off the books of the bank to profit and loss, and as a result of this loss the capital stock of the bank has been cut in half, reduced from $200,000 to $100,000. We shall also show you that the bank is no doubt now carrying paper and notes yet representing this old Maltby account of $120,000, or thereabouts, which is still unpaid, and that all the bank has to show for that paper are assets in round numbers $25,000 to $20,000, so there is another loss of from $90,000 to $100,000 still to be charged off the books of the bank which has not been charged off. We expect to show you, gentlemen of the jury, that all of this enormous loss was' actually suffered by the bank back in the years 1902 and 1903 before Mr. Woodworth bought his stock or Miss Smalley bought her stock. We expect to show you that the loss was suffered back then, and that these defendants, instead of charging it off at that time, carried along on the books of the bank a tremendous lot of worthless paper purporting and appearing to be assets of the bank, which were not assets, which were worth nothing, and which they knew to be worth nothing. And on the question of their knowledge we expect to show you that the facts at the hands of these men — facts which they had within their reach such that by the use of reasonable care they would have advised them — were sufficient to advise them, in the year 1902 and early in 1903, that these assets were worthless. * * * We expect to show you that the facts within the reach of these men were sufficient to give them a knowledge about these accounts and about the value of these assets, and give them a clear idea of what they were worth. And we expect to show you that the circumstances were such that with reasonable care they should have known the true condition of affairs, whether they knew it or not actually. We expect to show that, and prove that by the contents of the books of the bank, by the contents of the books of the Maltby Lumber Company, and by the contents of the books of the Maltby Cedar Company, which we shall show you was a corporation formed for the benefit of the Old Second National Bank in the year 1904, to take over and realize upon the assets of Alzina Maltby. We also expect to show you these men had actual knowledge.”

After making his opening statement, plaintiff’s counsel called the cashier of the bank, and sought to examine him as to. the books of the bank. Upon objection being made, the court ruled that the cashier could not be inquired of as to the books until some proof of misrepresentations on the part of defendants had been put. in.Thereupon, counsel for plaintiff gave evidence tending'to show the publication of several reports; the last of them being a report of November 17, 1903, which contained, under the head of “Resources,” the item, “Loans and Discounts, $1,081,446.05,” and that on December 16,1903, plaintiff’s agent, relying upon the published statements, puchased for plaintiff 10 shares of the stock of the bank from a broker. It was agreed by counsel that the published statement agreed with the books of the bank. In the course of the examination of plaintiff’s agent, the following occurred:

Q. In buying this Smalley, stock, to what extent did you rely upon the published statement under date of November 17, 1903 ?
“Mr. T. A. E. Weadock: I object to that as incompetent, for he has already answered the question.
The Court: Sustain the objection. * * *
Q. State whether you would have bought the plaintiff’s stock on December 16, 1903, if you hadn’t seen the published statement of November 17, 1903.
Mr. T. A. E. Weadock: I object to that as leading.
The Court: Sustain the objection.
“Mr. J. C. Weadock: Exception.
The Court: As I understand, this man has been all over that. He has made the statement once, and he has come in here apparently to make it over again.
“Mr. Clark: Exception to that remark.
“Mr. J. C. Weadock: His statement was he relied upon this statement. Our purpose is to show it was an exclusive reliance.
“Mr. Clark: Not only that, but a reliance to the extent that he wouldn’t have bought this stock without this statement.
The Court: That’s the way I understand it. I sustain the objection. * * *
Q. When you bought the plaintiff’s stock, state what, if any, knowledge you had of the facts in regard to the Maltby and Brotherton paper held by the Old Second National Bank, its amount, or its value.
“A. -I had no knowledge whatever of how much Maltby or Brotherton paper they had.
Q. What knowledge did you have in any way in re•gard to the value of such of the Maltby and Brotherton paper as they had ?
“ A. I had no knowledge of the value of the paper.
“ Q. What knowledge did you have as to what other paper was included in that statement of loans and discounts made by the bank ?
“A. I had no knowledge of any of the paper.
Q. Or what it was worth ?
“A. None whatever. The plaintiff herself had nothing to do with the purchase of this stock outside of the signing of this check and giving it to me. * * *
“,Q. You say in buying this stock you relied entirely upon the statements ?
“A. Yes; I did. * * *
Q. What do you mean by the statement you made on cross-examination that you knew that all these bank statements in showing loans ánd discounts would show them regardless of their values ?
“Mr. T. A. E. Weadock: I object to that as incompetent cross-examination of his own witness.
The Court: It’s a question for the jury.
“Mr. Clark: Exception.
Q. Did you understand the question asked by Mr. Weadock as I asked it to you in this question ?
“Mr. T. A. E. Weadock: Objected to as incompetent.
The Court: Call the attention of the witness to the testimony, and then I will rule upon it. (Recess. Copy of question and answer furnished by stenographer.)
“ Q. I call your attention to the question and answer. (Reading.) ‘You knew that the statement in their reports meant the amount of loans and discounts held at the bank on that day regardless of their value ?
“ ‘ A. Yes.’ I ask you if you understood that question and intended to answer it that way ?
“Mr. T. A. E. Weadock: I object to that as incompetent, as utterly unwarranted.
• “ The Court: I sustain the objection. If you want to get at that matter, you will have to get at it in some different way.
“Mr. Clark: Exception. * * *
“Mr. J. G. Weadock: Mr. Woodworth has testified on the stand that he assumed and believed that statement contained a statement of the resources of the bank. If there is any misapprehension upon the subject, we desire to clear up the testimony, and put Mr. Woodworth back' on the stand. We don’t want this court to assume Mr. Woodworth has said he knew there was in that report any loans and discounts which were bad.
The Court: He did say so as plainly as the English language or any other language can convey it.
“Mr. Clark: Exception to that statement. * * *
“Mr. Clark: Will the court rule upon our offer to place Mr. Woodworth again upon the stand ?
“The Court: After this motion is made. I understand there is a motion to take this case from the jury.
Mr. T. A. E. Weadock: Exactly.
“Mr. Clark: We say our case isn’t completed, and Mr. Woodworth’s testimony is not completed.
“The Court: You withdrew Mr. Woodworth, and said he was excused, and you certainly knew the court told you you must make your principal case by Mr. Wood-worth in the first place before you put any other testimony upon the stand, and then you called Mr. Andrews and other witnesses after excusing Mr. Woodworth.
“Mr. Clark; After we had attempted to get from Mr. Woodworth an explanation, and your honor had prevented us from doing it. Now, we again ask the privilege of making that explanation.
‘ ‘ Mr. T. A. E. Weadock: When the plaintiff himself made the statement his case was gone, and you knew it.
Mr. Clark: I believe it is for the jury to say whether—
“ The Court: Gentlemen of the jury—
“Mr. J. C. Weadock: We haven’t completed our testimony, and we desire to make our record complete—
“Mr. T. A. E. Weadock: No.
“Mr. J. C. Weadock: Then we want to have on the record what we propose to show or prove:
“The Court: That is entirely proper.”

Plaintiff’s counsel thereupon offered in evidence certain depositions, and made an offer to prove, extending over several pages of the record, covering the opening statement of her case in detail, and with some additional matter. In the course of the statement, the following occurred:

“Plaintiff’s agent in buying plaintiff’s stock relied upon the published statement of November 17, 1903, and would not have purchased this stock if he had not seen this statement, and if it had not been shown that the stock had increased'in value since the previous statement.
The Court: You cannot show anything further on that subject. You have already gone into that.
“Mr. Clark: We didn’t show it.
The Court: I said if you asked it in a proper way you could ask the direct question, or without questioning let him explain what he meant by his statement.
Mr. Clark: I will repeat that this offer is made, as I said in the beginning, in addition to the proofs already made.”

At the conclusion of the statement,.the following occurred : t

“Mr. T. A. -JEJ. Weadock: We object to that as incompetent, irrelevant, and immaterial. And I desire to say that if these gentlemen have any proof that either óf these defendants at any time, or in any way, made any false representations, let them produce the proof of it. We say they are making a statement which consists of mere words which we know they cannot prove. They have no proof of that sort. If they have, we will listen to it. But so far as the whole case goes, the statement that is made here, I object to it as incompetent, irrelevant, and immaterial, except so far perhaps as it charges them with direct fraud of which they have no evidence and can produce none. There is testimony enough here which, as the proof stands in this, would preclude the plaintiff from recovering. I say, further, that the offer, in the shape it is made, is entirely incompetent. No court can be called to rule upon such a statement as that.
“ The Court:' I sustain the objection to it.
“Mr. Clark: Exception.”

Thereupon the court directed a verdict for defendants, stating, among other things, the following:

“Now, from the testimony already given in this case' by Mr. Woodworth, who here stands in the place and stead of the plaintiff, Miss Smalley, I am satisfied that the plaintiff cannot recover in this case in any event, for the reason that he was not deceived by this statement. His testimony in this case indicates that he knew these statements did not show the true condition of the affairs of the bank, that they might'include bad paper as well as good, that they might include suspended paper as well as good, and, in fact, that it might include a large amount of bad paper, and part of this testimony I will now quote. In regard to this he says in answer to a question, as follows ( quoting testimony): * * * Now, gentlemen, in my view of this case the evidence is so strong that it is impossible to meet it, that the plaintiff in this case through her agent, Mr. Woodworth, had full knowledge of the manner in which these bank statements were made out, and could not charge these people with fraud because of having been deceived by a statement of that kind, which he knew was utterly unreliable according to his own statement. He was put upon inquiry, and was bound to go further and ascertain more before he could rely upon that statement. He was not warranted in relying upon that statement, and then seek to hold these defendants for any loss which he might suffer or which might have been suffered thereby. I therefore instruct you, gentlemen of the jury, to render a verdict in this case of not guilty.”

The judgment in this case cannot be sustained, unless the court was correct in his conclusion that the testimony of plaintiff’s agent conclusively negatived her cause of action. Field v. Clippert, 78 Mich. 26. We are of the opinion that the court .erred in excluding answers to the questions calling for explanations of the agent’s testimony and as to the extent of his reliance upon the reports. We are also of the opinion that it did not appear from the testimony of plaintiff’s agent, as a matter of law, that he had no right to rely, and did not rely, upon the reports to the comptroller. He testified that he did rely upon the reports, and, although the inference that he did not might be deduced therefrom, his testimony, considered as a whole, would have authorized a finding that he did rely upon the reports. The questions of his knowledge of the making up and contents of the reports, and of his reliance upon them, were, at the most, questions for the jury, and not for the court. He testified that he had no knowledge of any of the paper included in the item “Loans and Discounts,” or of its value. We do not think it conclusively appears, as stated by the court, that the agent had full knowledge of the way these reports were made out, and that they were so utterly unreliable that he was bound to go further and ascertain more before he could rely upon the reports. The diligence required of the plaintiff’s agent must be considered in connection with the character of the representations upon which he claimed to rely. The reports were published in accordance with the provisions of section .5211 of the Revised Statutes of the United States, containing a provision that “each such report shall exhibit, in detail and under appropriate heads, the resources and liabilities of the association at the close of business on any past day by him specified.” The object of this section, as said by the Supreme Court of the United States, “was to apprise the comptroller of the currency and the public of the condition of each national bank at stated periods.” Cochran v. U. S., 157 U. S. 286, 296. We think it necessarily follows that a person contemplating the purchase of stock of the bank has a legal right to rely upon the published report as a true statement of the financial condition» of the bank, without further inquiry, in the absence of’ knowledge tending to show the unreliability of the statement. 2 Cook on Corporations (5th Ed.), § 352. The prospective purchaser is not chargeable with knowledge of such circumstances as he might have discovered by the exercise of ordinary prudence and diligence, but only with the natural inferences deducible from the knowledge possessed by him. Smith v. McDonald, 139 Mich. 225; Sawyer v. Building Ass’n, 103 Mich. 228. There is some confusion in the testimony of the agent due to the fact he was cross-examined at length with reference to knowledge acquired and conduct on his part after the purchase of the stock, which could only be competent as bearing upon the credibility of his testimony, and would not be competent as admissions or proof of facts against the plaintiff. Hall v. Murdock, 119 Mich. 389.

In view of another trial, we consider it proper to express our views as to certain of the questions argued in the briefs of counsel.

It is the settled rule in this State, whatever the rule may be elsewhere, that one who purchases property in the belief of, and reliance upon, false statements regarding it, may sue for and recover the damages occasioned thereby, whether the representations are made in good or bad faith.” Krause v. Cook, 144 Mich. 365.

Directors of a bank are bound to exercise that degree of care in the business affairs of the bank that ordinarily prudent and careful men would exercise in affairs of like importance. Briggs v. Spaulding, 141 U. S. 132; Commercial Bank of Bay City v. Chatfield, 121 Mich. 641; Gibbons v. Anderson, 80 Fed. 345. The liability of. the directors in a case like this is independent of the national banking act, and is derived from the principles of the common law. Prescott v. Haughey, 65 Fed. 653; Brinckerhoff v. Bostwick, 88 N. Y. 52; Yates v. Jones Nat. Bank (Neb.), 105 N. W. 287. If the directors signing the report knew, or by the exercise of ordinary diligence in the discharge of their duties would have known, prior to signing such report, that the item ‘ ‘ Loans and Discounts ” contained paper worth much less than its face value, which would materially affect the value of its stock, they would be individually liable to a purchaser of the stock who relied in good faith upon such report as stating the true financial condition of the bank. Prewitt v. Trimble, 92 Ky. 176; Heard v. Pictorial Press, 182 Mass. 530; Hubbard v. Weave, 79 Iowa, 678.

The judgment is reversed, and a new trial granted.

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

ON MOTION FOR REHEARING.

Per Curiam.

A motion for rehearing has been made in this case based upon the recent decision of the Federal Supreme Court in the case of Yates v. Jones Nat. Bank, 206 U. S. 158. The Federal-case, although decided five days earlier, had not been published at the time of our decision. We do hot think any useful purpose would be served by granting a rehearing because of the decision referred to. The case does not touch the principal grounds upon which the case before us was reversed. It does establish a different test of the liability of directors of a national bahk for participating in alleged false official reports to the comptroller of the currency from that adopted by this court, and as such test must be considered to be the law of the case in all further proceedings.

Application denied.


source: Caselaw Access Project

author: Blair, J.

license: Public Domain

text:
    STATE ROAD BRIDGE CO. v. SAGINAW CIRCUIT JUDGE.
    Venue — Change—Time to Move — When Cause at Issue.
    A chancery cause is at issue upon the filing of a demurrer to the bill, and a motion for change of venue filed more than 10 days thereafter is not timely (Circuit Court Rule 58), though the demurrer is overruled and answer and replication subsequently filed.
    Mandamus by the State Road Bridge Company and others to compel William G. Gage, circuit judge of Saginaw county, to vacate an order denying a change of venue.
    Submitted April 16, 1907.
    (Calendar No. 22,227.)
    Writ denied May 18, 1907.

      De Vere Hall {William F. Paine, of counsel), for relators

      Miles J. Purcell {L. T. Durand and Frank E. Emerick, of counsel), for respondent.
   Blair, J.

December 26, 1905, the prosecuting attorney of Saginaw county filed a bill of complaint in the circuit court for the county of Saginaw, in chancery, in the nature of an information in quo warranto, against petitioners, to determine by what warrant the bridge company claimed to exercise the franchise and privilege of collecting tolls over its bridge across the Tittabawassee river. Application was also made for a temporary injunction. January 1, 1906, petitioners filed a demurrer to the information and a motion for a change of venue. The motion for a change of venue was denied by the circuit judge, and on March 13, 1906, his action was approved by this court, on the ground that the requisite four days’ notice of the motion had not been given. State Road Bridge Co. v. Saginaw Circuit Judge, 143 Mich. 337. April 13, 1906, claim of appeal from the order overruling the demurrer was filed, and on August 4,1906, the order was affirmed by this, court. Rockwith, ex rel. Kerns, v. Bridge Co., 145 Mich. 455. January 5, 1907, answer was filed by defendant, and on January 28, 1907, replication and notice to take proofs in open court were filed. On February 7th, the motion for change of venue, which is the basis of the present application for a writ of mandamus, was made, and on February 20th denied.

The reasons of the circuit judge for denying the application for change of venue are concisely stated in the brief for respondent, as follows:

“ 1. Defendant ( relators) failed to comply with the requirements of Circuit Court Rule 58.
“2. The matter of this motion was, by the making of the former motion upon the same subject upon the same grounds and for the same reasons, and its disposition, rendered res adjudicata.
“ 3. The statute (Act No. 309, Pub. Acts 1905) does not apply to chancery cases.
“4. No grounds upon which the motion is founded are set out, as required by law. Circuit Court Rule 19.”

It is contended on behalf of respondent that, by the provisions of Chancery Rule 13a, the cause was at issue upon the filing of the demurrer in January, 1906, and therefore the motion was not timely, under Circuit Court Rule 58. This contention must be sustained. As we said in Detroit Portland Cement Co. v. Genesee Circuit Judge, ante, 286:

“ There could be little reason for an application for a change of venue before an issue of fact or law should be joined, for the case could then be heard only upon default. And we are of the opinion, therefore, that a court should not be asked to change the venue by a defendant who has not made an issue. And, as chancery causes are not in condition for hearing until all defendants over whom the court has obtained jurisdiction have either tendered an issue or been defaulted (see Chancery Rule 13), we think that an application made within 10 days after the filing of the last plea, answer, or demurrer, or expiration of the period for the entry of defaults, would be seasonable under the rule. ”

The writ is denied.

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


author: Moore, J.

text:
    FORD RIVER LUMBER CO. v. PERRON.
    1. Corporations — Reports—Failure to File — Liability of Directors.
    Where the secretary of a corporation mailed a letter to the secretary of State containing duplicate reports of the condition of the corporation as required by the statute, the directors of the corporation are not liable for the debts of the corporation subsequently contracted, under section 12, Act No. 232, Pub. Acts 1903, as amended by Act No. 194, Pub. Acts 1905, though the secretary of State never received the letter.
    2. Same — Statutes—Amendment.
    Act No. 194, Pub. Acts 1905, amendatory of section 12, Act No. 232, Pub. Acts 1903, controls the liability of directors of corporations for failure to file annual reports subsequently attempted to be enforced, though the failure to file the report occurred prior to the taking effect of the act.
    Error to Delfa; Stone, J.
    Submitted April 5, 1907.
    (Docket No. 16.)
    Decided May 18, 1907.
    Assumpsit by the Ford River Lumber Company against Menezippi Perron, as director of the Perronville Shingle Company, for goods sold and delivered. There was judgment for defendant on a verdict directed by the court, and plaintiff brings error.
    Affirmed.

      F. D. Mead, for appellant.

      Gummiskey & Spencer, for appellee.
   Moore, J.

The plaintiff had a debt of upwards of $6,000 growing out of a log contract against the Perronville Shingle Company, of which company the defendant was president and director. As the Perronville Company failed to pay this debt, suit was brought against defendant upon the claim that he was liable under the provisions of section 12, Act No. 232, Pub. Acts 1903, as amended by Act No. 194, Pub. Acts 1905. Upon the trial the following facts were stipulated: .

“It is hereby stipulated in the above-entitled cause by counsel for the respective parties that the annual report of the Perronville Shingle Company for the year 1903 was filed in the office of the secretary of State for the State of Michigan on the 29th day of February, 1904; that said report is the last annual report of the condition of said company that has been filed, and that no other report in accordance with the provisions of section 12, Act No. 232, Pub. Acts 1903, has been filed in the office of the secretary of State since said 29th day of February, 1904; that on the 7th day of April, 1905, said company filed in the office of the secretary of State a notice of dissolution, a certified copy of which is attached hereto, marked ‘Exhibit A.’
“ It is further stipulated that on the 24th day of February, 1905, the said Perronville Shingle Company, by A. H. Meloche, its secretary, mailed a letter addressed to Fred M. Warner, secretary of State, inclosing in said letter reports in duplicate for the year 1904 of the condition of said company, together with 50 cents for filing fee; that the secretary of State will testify that such report, so far as the records show, was not received or filed, and no fee paid for such filing, if produced as a witness on the trial of this cause; that attached hereto is a letter of the said secretary of State, marked ‘Exhibit B,’ written to Cummiskey & Spencer, defendant’s attorneys, and dated October 1, 1906.
“It is further stipulated that in the years 1903, 1904, and 1905 the said defendant was one of the directors of said company and the president of the Perronville Shingle Company.
“It is further stipulated that this stipulation may be offered in evidence by either party on the trial of said cause with the same force and effect as if the facts above mentioned had been proved by the testimony of witnesses.”

The trial court directed a verdict in favor of defendant. The case is brought here by writ of error. The claim is stated by plaintiff’s counsel as follows:

“The sole question involved in this case is: Are the stipulated facts sufficient to relieve the defendant from liability under section 12, Act No. 232, Pub. Acts 1903 ? We contend that they are not, and that the defendant is liable under a proper construction of the terms of this act. The terms of the act, so far as they apply to this case, are as follows:
“ ‘ Every corporation subject to this act shall annually, in the month of January or February, make duplicate reports for the fiscal year last ending, of such corporation, on suitable blanks to be furnished by the secretary of State as hereinafter provided.’
“ Then follows the portion of the statute as to the contents of the reports.
“ ‘Such reports shall be signed by a majority of the board of directors and verified by the oath of the secretary of the corporation, and deposited in the office of the secretary of State within said month of January or February.’ '
“ The statute then provides that the secretary of State shall carefully examine the reports, and if .they shall be found to comply with the requirements of this section he shall file one of them in his office, and shall forward the other by mail or express to the county clerk of the county in which the office in this State for the transaction of the business of said corporation is situated. It is made also the duty of the county clerk to immediately file the same. The statute then provides:
“ ‘ If any of the directors of any such corporation shall willfully neglect or refuse to make and deposit the report required by this section, within the time herein specified, they shall each be liable for all the debts of such corporation contracted since the filing of the last annual or special report,’ and subject to the penalty therein provided. 1
“ The statute further provides as follows:
“ ‘The neglect or refusal to file the reports required by this section to be-filed, shall be deemed to be.willful when the report required is not filed within the time herein limited.’
££ This statute was amended by Act No. 194, Pub. Acts 1905. As we contend, however, it kid not enlarge in any way the liability of the directors, although the language of the act is different. It did not, however, go into effect until after the liability, if any, was incurred in this case.”

Counsel for defendant insists the facts disclosed by the record show that the failure to make and deposit the report was not willful, but that an attempt was made in good faith to comply with the law; citing Shaver v. Ingham, 58 Mich. 654, and Bank of Saginaw v. Pierson, 112 Mich. 410.

It is also the claim that as section 12, Act No. 232, Pub. Acts 1903, was amended by Act No. 194, Pub. Acts 1905, the last-named law must control. We think this contention is sustained by Breitung v. Lindauer, 37 Mich. 217 and Bank of Saginaw v. Pierson, 112 Mich. 410. It becomes important, then, to consider the provisions of the statute as amended. The important part reads as follows :

“ If any corporation neglect or refuse to make and file the reports required by this section within the time herein specified, and shall continue in default for ten days after the first day of February, its corporate powers shall be suspended thereafter until it shall file such report, and it shall not maintain an action in any court of this State upon any contract entered into during the time of such default; and any director of such corporation so in default, who has neglected or refused to join in the making of such report, shall be liable for all the debts of such corporation contracted since the filing of the last report of such corporation, and shall also be liable to such corporation for any damages sustained by it by reason of such refusal or neglect.” ' •

It will be seen that the penalty of $25 and $5 per day has been eliminated, and that the punishment for not filing the report, is visited upon the corporation and not upon the directors by the amended law. The declaration does not allege, nor does the stipulation disclose, that defendant “has neglected or refused to join in the making of such report.” On the contrary, the stipulation shows the report was made and duly mailed. The defendant is not brought within the provisions of the amended statute.

The judgment is affirmed.

Grant, Montgomery, and Hooker, JJ., concurred. Blair, J., concurred in the result.


text:
    CONSTANTINE v. CITY OF ALBION.
    ■ Municipal Corporations — Public Improvements — Special Assessments — Waiver op Defenses.
    Equity will not relieve from a special assessment a landowner who fails to take proceedings therefor until the improvement is completed, a statute legalizing the proceedings has been passed, and two of the five installments of the assessment have become due and have been paid by all but him.
    Appeal from Calhoun; Hopkins, J.
    Submitted April 5, 1907.
    (Docket No. 23.)
    Decided May 18, 1907.
    Bill by Sidney M. Constantine against the city of Albion, Afton A. Dibble, city treasurer, and Erwin A. Doolittle, county treasurer, to restrain the collection of a paving tax. From a decree dismissing the bill, complainant appeals.
    Affirmed.

      8. M. Constantine and H. O. Bliss, for complainant.

      Weeks & Cooper, for defendants.
   Blair, J.

The bill of complaint in this cause was filed to restrain the collection of a special paving assessment, and to remove the cloud upon complainant’s title caused by levying said special assessment upon his land.

Several petitions of owners of property fronting upon the proposed improvement were presented to the common council, and the common council, having determined that a majority in interest of such owners had petitioned therefor, ordered the improvement. The proposition to pave and bond the city to defray the expense was submitted to the electors and carried. Complainant appeared before the council, by his attorney, and protested against the proposed improvement and filed written objections thereto. The contract for the paving was entered into before funds were provided to defray the expense thereof as required by the city charter. Subsequent to the levying of the special assessment a special act (Act No. 466, Local Acts 1905) was passed by the legislature and approved by the governor on April 12, 1905, to legalize “all the proceedings had in the laying out, establishing, constructing and completion ” of said pavement. The assessment was divided into five installments, two of which had become due and payable and paid by all others assessed, and the improvement had been completed, before this bill of complaint was filed. Under such circumstances, this court has uniformly refused to grant relief in equity, and the bill of complaint was properly dismissed. W. F. Stewart Co. v. City of Flint, 147 Mich. 697.

The decree is affirmed, with costs of this court to defendant.

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


author: Carpenter, J.

text:
    G. F. SANBORN CO. v. JOHNSON.
    1.Taxation — Tax Sales — Notice to Redeem — Sufficiency-Several Parcels.
    A notice to redeem from a. tax sale, pursuant to section 140 of the tax law (section 3959, 1 Comp. Laws), is insufficient where it describes several parcels and does not specify the amount required to redeem each parcel.
    2.Same — Writ op Assistance — Jurisdiction to Issue — Sufficiency of Notice.
    A notice to redeem from a tax sale under section 140 of the tax law, which is insufficient for that purpose, which states, “If payment as aforesaid is not made the undersigned will institute proceedings for possession of the land ” is not sufficient, without further process, to confer jurisdiction on the court to issue a writ of assistance.
    3. Same — Continuation of Proceeding.
    Where an application for a writ of assistance was not entitled in the tax sale proceedings on which the applicant’s claim was founded, was not filed in such proceedings, and did not refer thereto, it was in no sense a continuation of such pro- , ceedings, but was a separate suit.
    4. Same — Right to Redeem — Laches.
    Where a tax title purchaser never entered into possession of the land, and because of defects in his notice to redeem never acquired the right to the possession, the landowner is not barred of his right to quiet his title because he delayed three or four years after the purchaser procured a writ of assistance before bringing suit.
    Appeal from Gogebic; Cooper, J.
    Submitted April 8, 1907.
    (Docket No. 28.)
    Decided May 18, 1907.
    Bill by the G. F. Sanborn Company against Oscar Johnson and James B. Bradley, auditor general, to remove a cloud from the title to certain land. From a decree dismissing the bill, complainant appeals.
    Reversed, and decree entered for complainant.

      Taggart, Denison & Wilson, for complainant.

      Herb. M. Norris, for defendant Johnson.
   Carpenter, J.

Complainant, claiming to be the owner of a certain 40 acres of land situated in Gogebic county, brings this suit in equity to remove a cloud upon its title. That cloud consists of a tax title arising from the nonpayment of the taxes assessed upon said land for the years 1896 and 1897. This title was in its inception regular and was purchased by the State. In 1901, after the time of redemption had expired, the land was sold and regularly deeded by the State to John Martin and John Win-berg. Very, soon after their purchase Martin and Win-berg undertook to give the statutory notice prescribed by section 140 of the tax law (1 Comp. Laws, § 3959). This notice described four parcels of land, and stated, not the amount paid for each parcel, but the aggregate amount paid for all, and was served on the agent of the Persis Iron Company, complainant’s grantor, who then owned the land. February 15, 1902, about 11 months after said notice was given, Martin and Winberg applied to the circuit court for the county of Gogebic, in chancery, for a writ of assistance, and that court at once made an order directing the issuance of said writ and adjudging petitioners “ duly entitled to the possession of the premises.” No notice of the application for said writ was served upon complainant’s grantor, the then owner of said premises, and no one appeared in its behalf. A few days after this order was granted, Martin and Winberg, by quitclaim deed, conveyed the land in controversy to defendant Johnson. The land is wild and unoccupied, and never was in the actual possession of Johnson or of Martin and Winberg. April 24, 1905, the Persis Iron Company conveyed the land to complainant. Shortly .thereafter complainant undertook to redeem, and tendered Johnson the amount specified in section 141 of the tax law, and demanded a quitclaim deed of the land. Johnson refused to accept that tender and to execute said deed. The circuit court held that the foregoing facts did not entitle complainant to relief, and dismissed its bill. Complainant appeals.

The decisive question in the case is this: Had complainant at the time it made the tender to defendant the right to redeem from the tax title owned by him ? In the circuit court this right was denied upon the ground that the right of redemption expired six months after Martin and Winberg gave the Persis Iron Company notice to redeem. This contention is unsound, because that notice did not comply with the law (section 140 of the general tax law), directing it to be given. It was utterly insufficient, because it did not specify the amount for which each parcel of land was sold. Jackson v. Mason, 143 Mich. 355; John Duncan Land & Mining Co. v. Rusch, 145 Mich. 1.

It is further contended that the order adjudging Martin and Winberg entitled to the possession of the land and awarding the writ of assistance is an adjudication of complainant’s rights which cannot be assailed in this suit. This contention would be sound if the court had jurisdiction to make that order. On the other hand, the adjudication is of no force whatever if the court lacked jurisdiction. We must, therefore, determine this important question, viz.: Had the court jurisdiction to determine that Martin and Winberg were entitled and that complainant’s grantor was not entitled to the possession of the land F The principle is elementary that, when one does not voluntarily appear, notice is essential to give a court jurisdiction to adjudicate his rights in property. Says Justice Brown, speaking for the Supreme Court of the United States, in Roller v. Holly, 176 U. S. 409:

“That a man is entitled to some notice before he can be deprived of his liberty or property is an axiom of the law to which no citation of authority would give additional weight.’’

It is true that in .proceedings in rem, and I think the proceedings under consideration were in rem, that notice need not be personally served. It may there be given ‘ ‘ by some species of publication or proclamation ” (Cooley on Constitutional Limitations [7th Ed.], p. 581), but it must be “reasonable and adequate for the purpose.” Roller v. Holly, supra.

It is urged that the notice calling upon the Persis Iron Company to redeem gave the court jurisdiction to issue the writ of assistance. It is true that this notice, which was given 11 months before the writ of assistance was applied for, stated:

‘ ‘ If payment as aforesaid is not made, the undersigned [Martin and Winberg] will institute proceedings for possession of the land.”

Whoever insists that this language was effectual as a notice of the proceedings subsequently taken in this case must maintain that it imposed on the owner the duty of being constantly in court and at all times prepared to oppose an attack upon his title. That is not the import of the language, “The undersigned will institute proceedings for the possession of the land.” From this the owner has a right to infer that the proceedings to be instituted will be carried on with due regard to his rights, viz., that he will be afforded an opportunity of being heard; that notice will be given him when they are instituted. In our judgment, the notice to redeem did not give the court jurisdiction to issue the writ of assistance.

It is also claimed that the application for the writ of assistance" was merely a continuation of the proceedings under which the land was sold for the nonpayment of taxes, and that the publication of the notice of those proceedings gave the court jurisdiction to issue said writ of assistance. Whether this reasoning is sound or not we will not undertake to determine. It is sufficient to say that it rests upon a faulty premise. The application for the writ of assistance in this case was in no sense a continuation of the proceedings under which the land was sold for nonpayment of taxes. That application was not entitled in those proceedings, was not filed in those proceedings, and did not refer to those proceedings. It was in fact an entirely separate suit.

As a result of this discussion, we decide that the court issuing the writ of assistance did not, because of the absence of notice, have jurisdiction to determine that complainant’s grantor was not entitled to the possession of the land in question, and that the order for said writ presents no objection to granting relief in this suit. We can find nothing to affect the right given complainant bylaw (sections 140 and 141 of the general tax law) to redeem from defendant’s tax deed, and we therefore conclude that its attempted redemption was legal and effectual.

Defendant also contends that complainant was guilty of laches, because he delayed three or four years before instituting this suit. The facts afford no basis for this contention. Defendant never entered upon the possession of this land; and, as the notice to redeem was defective, he never acquired the right to the possession. The doctrine of laches has no application.

The decree of the circuit court should be reversed, and a decree granted complainant in accordance with the prayer in its bill, with costs of both courts.

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


text:
    HOWARD v. BELLOWS.
    Injunction — Propriety — Adequate Remedy at Law — Flooding Lands — Damages.
    An injunction will not be granted restraining defendant from flooding complainant’s lands by his logging operations, where such operations have been continued for years in practically the same manner without indication from complainant that he could not be compensated in damages, where a considerable investment by defendant would be rendered valueless, and complainant’s injury from the operations is pecuniary and small in amount.
    Appeal from Benzie; Chittenden, J.
    Submitted April 9, 1907.
    (Docket No. 38.)
    Decided May 18, 1907.
    Bill by Henry M. Howard and Nellie L. Howard against Elwin H. Bellows and others to enjoin the flooding of complainants’ land. From a decree for complainants, defendants appeal.
    Reversed, and bill dismissed on condition.

      David E. Burns, for complainants.

      Louisell & Nevius (Barm O. Gilbert, of counsel), for defendants.
   Carpenter, J.

Defendant Bellows has for several years been engaged in rafting logs down Betsey river, in Benzie county, in this State. In order to do this, he found it necessary to dam the river and to release water therefrom in a flood. This water has inundated the land of complainants, who are husband and wife, situated on the banks of the river about 10 miles below defendant’s dam. In the circuit court a decree was made enjoining defendant from further inundating complainants’ land. Defendant appeals.

It is clear that complainants have a grievance, but it does not follow that they are entitled to an injunction. The testimony proves that the only injury 'sustained by them is pecuniary in its character and small in amount; that defendant has made an investment of considerable magnitude, which will be rendered valueless if the injunction is permitted to stand; that he is entirely willing to compensate complainants for their pecuniary loss; that the rafting operations on the river have been carried on for several years substantially as they are now carried on; and that during this time complainants never indicated that they sustained an injury which would not be adequately compensated by damages. Indeed, it appears that at one time they accepted compensation for a similar injury from defendant’s grantor, who built the dam in question. Under these circumstances, we think under the rule laid down in Fox v. Holcomb, 32 Mich. 494, Hall v. Rood, 40 Mich. 46, and Blake v. Cornwell, 65 Mich. 467, that an award of damages afford complainants adequate relief, and that a court of equity should not enjoin defendant from carrying on his rafting operations.

Upon defendant executing a bond in the penal sum of $1,000, with sureties approved by the circuit judge or by the clerk of this court, conditioned upon his paying whatever judgments may be rendered against him for past or future flooding of complainants’ land, the decree appealed from will be reversed and the bill dismissed. This, of course, will be without prejudice to the right of complainants to prosecute their suits for damages. Complainants will recover the costs of the circuit court and defendant the costs of this court.

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


text:
    MERRINANE v. MILLER.
    1. Intoxicating Liquors — Civil Damage Law — Action — Evidence — Purpose—Illegality of Sales.
    In an action against a saloon keeper and his bondsmen for injuries to a wife from sales of liquor to her husband, the fact that sales were made during prohibited hours- and on prohibited days, can be considered by the jury only as determining the manner in which defendant was dealing with plaintiff’s husband, and whether there was any wantonness or recklessness in such dealings.
    2. Same — Recovery of Money Spent by Husband.
    Where there is no specific claim in the declaration for money spent by plaintiff’s husband for liquor, and no evidence from which its amount can be determined, an instruction that plaintiff is not seeking to recover therefor is not erroneous.
    3. Damages — Mortality Tables — Conolusiveness—Instructions —Propriety.
    An instruction that the mortality tables are not conclusive on the question of the continuance of life, but are given to the jury merely as aids, correctly states the general rule, and if counsel claims that the facts of the case take it out of the general rule, he should bring such claim to the attention of the trial court.
    4. Intoxicating Liquors — Civil Damage Law — Exemplary Damages — Inadequate Recovery.
    In an action against a saloon keeper and his bondsmen for injuries to a wife from sales of liquor to her husband, evidence examined, and held, that the undisputed evidence showed plaintiff entitled to a peremptory instruction for exemplary damages, and that a verdict for $600 was so clearly insufficient as to entitle her to a new trial.
    Error to Jackson; Parkinson, J.
    Submitted April 9, 1907.
    (Docket No. 41.)
    Decided May 18, 1907.
    Case by Nettie Merrinane against James Fred Miller, a saloon keeper, and his bondsmen, under the civil damage act. There was judgment for plaintiff for an insufficient amount, and she brings error.
    Reversed.

      B. S. Woodliff, for appellant.

      Elmer Kirkby, for appellees.
   Blair, J.

Plaintiff, the wife of John Merrinane, brought this action, in accordance with the provisions of the civil damage act, to recover damages of defendant, a saloon keeper, and his different bondsmen for three successive years, occasioned by sales of liquor to her husband. Plaintiff and her husband, then recently married, moved to Grass Lake, in Jackson county, where defendant was conducting his business, in November, 1902. They were married in June, 1901, and lived at Chelsea till their removal to Grass Lake. Plaintiff’s husband was a telegrapher in the employ of the Michigan Central Railroad Company, earning $50 per month, and at the time he went to Grass Lake was a sober, industrious man of excellent habits, and had $500 of his earnings in bank. In the spring, after going to Grass Lake, he began to drink moderately at defendant’s saloon, of which plaintiff’s brother was bartender, and prior to December, 1903, occasionally got intoxicated. On December 22d he was notified of his discharge, as follows:

“Dear Sir: I enclose you time ticket for $27.44 covering 17 days’ service in December, and beg to advise you that by direction of Mr. D. S. Sutherland, Div. Supt., your services are dispensed with, having proven unsatisfactory.
“Yours truly,
“E. H. Millinghok, Supt. Tel.”

After his discharge he drank heavily and soon became a common drunkard. They paid $7 per month house rent and from $25 to $30 per month for the support of the family out of the money in the bank until March, 1905, when the money was all gone, and plaintiff has since that time supported herself without assistance from her husband. Merrinane was night operator, his hours of duty being from 7 p. m. to 7 a. m. Plaintiff testified:

“I knew he slept while he was on duty. He always had a student that knew the call, and they would call him when they needed him. He was a fellow that couldn’t sleep daytimes very much. He would try. I would often see him go to bed five or six times in one day, but he never could get used to sleeping daytimes, and he always had a student, and it didn’t make much difference because they could arouse him when they needed him. * * *
“ Did not ask Miller not to sell her husband. Witness never personally forbid Miller, from selling her husband liquor. Did once.through her brother, that was in March, 1905. Up to March, 1905, witness never forbid either the bartender of Miller either verbally or in writing not to sell her husband liquor; heard her husband call for a drink. She made no objection; said nothing to Miller at that time, although she had the opportunity.”

Defendant was the only witness in his behalf and testified, in substance, as follows :

“He patronized my business more or less during the spring of 1908. To my knowledge I never saw him intoxicated during that time. I never sold him when he was intoxicated; don’t know whether my bartender sold him or not. * * *
“When a man is intoxicated, in my judgment, he would be so he couldn’t help himself. To be intoxicated would be unable to help himself, would lay in a stupor, and would not be able to go home. A man who is able to go home, though he reels and takes up the whole sidewalk, I should not judge to be intoxicated.”

Plaintiff’s counsel. presented no requests to charge. The jury returned a verdict in favor of plaintiff and against all of the defendants for the sum of $600. Plaintiff made a motion for a new trial on the ground that the verdict was against the law and the evidence, and the damages awarded grossly inadequate. The motion was denied, reasons therefor filed, exception taken, and error assigned thereon. Plaintiff brings the record to this court for review upon writ of error.

In view of the verdict in plaintiff’s favor against all of the defendants, the only assignments of error- which require consideration are those based upon the denial of the motion for a new trial, and upon such rulings and instructions of the court as may have affected the amount of the damages. The seventh, eighth, and thirteenth assignments of error allege error in instructing the jury that the plaintiff could only complain of unlawful sales which were unlawful because made to an intoxicated person or one in the habit of getting intoxicated.

“I do not mean by unlawful sales, sales made after hours at night or before lawful hours begin in the morning. We are not undertaking to punish Mr. Miller because he kept open too late at night or opened up too early in the morning, or was open on Sunday or Christmas, or any other holiday. But you have a right to consider what sales he made and when he made them, if they were made to Mr. Merrinane, simply to enable you to understand in what way Mr. Miller was dealing with Mr. Merrinane; and, if he sold him liquors during the time 'he was a man in the habit of getting intoxicated or at times when he was intoxicated, he is liable, and it is sufficient whether he sold them out of hours or in hours. But, as I say, you may consider whether they were out of hours simply in connection with determining any wantoriness, or recklessness or carelessness in the way he was dealing with Mr. Merrinane, and for no other purpose.”

This question arose during the progress of the trial, and plaintiff’s counsel stated his position as follows:

“ If the sales the first year were legal at the time he was being made a drunkard, the bondsmen for that year are not liable. * * * If the sales are illegal and they tend to create the habit which makes him a drunkard, they are liable.”

It was held by this court in Peacock v. Oaks, 85 Mich. 578, that there could be no recovery under the statute for injuries caused by the sale or furnishing of liquor to another, unless such sale or furnishing is in violation of law. Whether this broad statement of the law may not require some qualification it is unnecessary to determine in this case. Plaintiff’s counsel conceded that plaintiff could only complain of illegal sales, but contended that among such sales were included sales after hours or on Sundays, etc. We think the instruction properly limited the effect of such sales.

The ninth assignment of error complains of an instruction that plaintiff was not seeking to recover any part of the money that her husband spent for liquor. There is no specific claim for such an item of damages in the declaration, nor was any evidence given from which the jury could determine the amount of money spent for liquor by Merrinane.

The tenth assignment of error is as follows:

“The court erred in charging the jury, as follows: ‘But, if the amount she would receive had only been diminished and she had not been entirely deprived of it, then you would consider the extent of the diminution, if any, of her support due to those causes.’ ”

It is contended that the testimony showed a complete and not a partial loss, and the instruction was therefore erroneous. The contention is not sustained by the record. There was only a partial loss during the first year at least.

The eleventh assignment of error is as follows:

“The court erred in charging the jury as follows: ‘ Now, the expectancy tables have been shown here in evidence. Her age is 29 and his age 33. Her expectancy is 36JV years and his expectancy 33TV-ff. These are simply given to you as aids, not as absolute proof that he would live 33 years, or that she would live 36 years.’”

The court correctly stated the general rule; and, if plaintiff’s counsel claimed that the facts of this case took it out of the general rule, he should have brought such contention to the attention of the court. Davis v. Railroad Co., 147 Mich. 479.

The serious question in the case is presented by the assignment of error upon the denial of the motion for a new trial. Are the damages so clearly inadequate, as claimed by plaintiff’s counsel, that the trial judge ought to have awarded a new trial? The facts establishing plaintiff’s cause of action, as presented by this record, are practically undisputed, and plaintiff would have been entitled, upon request therefor, to an instruction that she was entitled to a verdict, and the only question for the jury was as to the amount of the damages she had suffered. The undisputed facts presented by this record show that, when plaintiff and her husband moved to Grass Lake, he was a temperate, industrious man, of good standing in his vocation, earning $50 a month and contributing to his wife’s support from $25 to $30 per month. A few months after coming to Grass Lake, he began drinking at defendant’s saloon, and from that time on he gradually became intemperate until his discharge in December, 1903. “At the time of his discharge, he was there nearly all the time.” After his discharge his descent was rapid until he became a common drunkard, and was no longer capable of furnishing any support to plaintiff. The de-, fendant Miller and his employés began and completed Merrinane’s ruin. So far as this record discloses, they had no helpers. As often as he requested, after legal hours, on Sundays, or legal holidays, regardless of the law and his wife, so long as he was able to stand before the bar, they dealt out the liquor to him, and only desisted when “he lay in a stupor, and would not be able to go home.”

“Miller sold him liquor while in that condition any time he wanted it if he could only stand up and drink. * * * Witness [the bartender] told Miller if he kept selling Merrinane liquor it would make him trouble. Miller said he would not sell it to him, but the next day he would get it just the same. Miller said it was a good thing for witness’ sister to get a divorce from Merrinane. Miller said that it was the way his sister’s husband went. He either died or else she got a divorce. Miller said he thought Merrinane was so far gone he would never stop drinking.”

None of these statements were denied by Miller, and so clear a right to exemplary damages is presented by this record that a peremptory instruction to that effect would have been justified. The case is unique, in that the facts which support the cause of action are undisputed, and no attempt is made to soften the harsh features of the case or mitigate the damages. On the contrary, we have the opinion of the principal defendant that the damage was complete; that “Merrinane was so far gone he would never stop drinking.” Upon any reasonable theory of the facts disclosed by this record, we cannot regard the amount awarded plaintiff by the verdict of the jury as an adequate measure of her damages, and we think the trial judge erred in denying the motion for a new trial.

The judgment is reversed, and a new trial granted.

McAlvay, O. J., and Carpenter, G-rant, and Ostrander, JJ., concurred.


author: Ostrander, J.

text:
    VAN WYCK v. DICKINSON.
    1. Master and Servant — Personal Injuries — Negligence—Contributory Negligence.
    In an action by a boy of 15 for injuries caused by his getting caught in the gearing of a printing press, upon which he was employed, while stooping to pick up some sheets which had fallen to the floor, evidence as to the condition of the machine, and of plaintiff’s knowledge as to the dangers of working thereon, examined, and held, that a verdict was properly directed for defendant.
    2. Same — Employment of Minors — Statute—Declaration—Sufficiency.
    Where the employment of a child in violation of the statute (Act No. 113, Pub. Acts 1901) is relied upon as negligence justifying a recovery for injuries to the child, the declaration must aver facts from which an employment prohibited by the statute appears.

    Error to Kent; Wolcott, J.
    Submitted April 8, 1907.
    (Docket No. 24.)
    Decided May 18, 1907.
    Case by Le Roy Van Wyck, by next friend, against Albert G. Dickinson for personal injuries. There was judgment for defendant on a verdict directed by the court, and plaintiff brings error. Affirmed.
    Defendant carries on the business of printing and engraving in the city of Grand Rapids, using printing presses of various kinds and electricity for motive power. Plaintiff, a lad of 15 years of age, was employed in the establishment, and on February '5, 1906, was feeding a Peerless press, when several of the sheets of paper, which were yellow slips to be used for advertising purposes, fell to the floor, and, in picking them up, the sleeve of plaintiff’s shirt, which was rolled up, was in some manner caught in the machinery, and he was injured. Upon the right-hand side of the press and a part of it were two gear wheels, intermeshing, the smaller one held to the shaft by a pin or key with a small head, inserted next to and parallel with the shaft, acting as a wedge. The declaration avers the duty of defendant:
    ‘ ‘ To see that all keys or steel or iron wedges, used as aforesaid, to keep and fasten said wheels upon the iron shafts of said printing presses in their proper places and so driven in on said shafts as not to stick out over and beyond the ends of said shaft so as to catch into the clothing of the employés and servants of said defendant in' using said machines. Yet plaintiff avers that the said defendant, disregarding his duty in this behalf, negligently, carelessly, and insecurely used a certain iron or steel wedge or key upon one of said printing presses in use by him as aforesaid, and permitted said key to stick out beyond and over the end of a certain shaft upon which there was fastened a certain small cogwheel, which run and operated into another and much larger cogwheel, upon one of the printing .presses used as aforesaid by the said defendant, in. his said place of business.”
    It is further averred:
    “ Plaintiff was put to work, as aforesaid, upon the said printing press and directed as aforesaid by the said defendant to use the same, without any caution or instruction as to the danger to him by reason of any defect in said printing press or by reason of the said wedge or key being out of place and projecting out and over said iron shaft, and at which time the said printing press was insecure and unsafe for plaintiff or any other person to work upon and to use.”
    Defendant’s knowledge of the dangerous character of the machine and plaintiff’s want of knowledge are averred. Defendant offered no testimony, and a verdict for defendant was directed by the court upon the ground that the negligence alleged was not proven.

      Dunham, & Malcolm, for appellant.

      Bundy, Travis & Merrick, for appellee.

       For employment of child in violation of statute as negligence, see note to Rolin v. R. J. Reynolds Tobacco Co. (N. C.), 7 L. R. A. (N. S.) 335.

   Ostrander, J.

(after stating the facts). The most favorable construction which can be placed upon the testimony for plaintiff is that the key, which was a proper part of the press, had worked out of position so that it projected some, but very little, beyond the end of the shaft. ■ It is not a common thing, but these keys do sometimes work loose. In other respects the press was in perfect order. It was the one upon which, under instruction, plaintiff had three months before learned to work. His duty was to start, feed, and stop it. In starting and stopping it he used a lever. All of its parts were visible, and its speed was not such as to put the key out of vision. He was standing at his work, and when the sheets fell to the floor, at the side of, not under, the machine, he walked to the side of the machine, stooped to pick them up, and brought his sleeve in contact with the gearing. He admits his knowledge of the danger of approaching too closely to the machinery, and that in picking up the papers he took no account of how close he approached his arm to the gearing. How long the pin had been out of position does not appear, and it is doubtful if the testimony reasonably supports an inference that the projecting pin increased the danger. Indeed, plaintiff’s testimony leaves it in doubt whether his sleeve was not caught in the gear, instead of on the pin. The most ordinary care would have avoided danger.

. We are asked to give some effect to the statute (Act No. 113, Pub. Acts 1901), which forbids the employment of children under the age of 16 years in a manufacturing establishment at employment where life or limb is endangered. Section 2 of this act was amended in 1905 (Act No. 1?1), and it appeared that the mother of plaintiff, before defendant hired the boy, made the sworn statement required by said section. It is not averred that it was negligence to employ plaintiff in this establishment, at this work. Borck v. Nut Works, 111 Mich. 129.

It is contended that, so long as the facts show an employment prohibited by the statute, it is immaterial, so far as the question of defendant’s negligence is concerned, whether the statute is declared upon or not. If by this is meant that it is unnecessary to aver an employment such as the statute prohibits, the contention is not sound, and the point is ruled by the case above cited. Whether a defendant is conducting a manufacturing establishment within the meaning of the statute, and whether the particular employment endangers life or limb, are questions of fact, and if it is claimed that the facts exist the rules of pleading demand a tender of the issues so that defendant may be informed of the case he is required to meet. The case of Ferguson v. Gies, 82 Mich. 358 (9 L. R. A. 589), relied upon by counsel, is not in point. In that case plaintiff’s right of action existed at common law, of the rule of which the statute was held to be declaratory. The judgment is affirmed. . ,

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


text:
    KNIGHTS OF THE MODERN MACCABEES v. GRICE.
    Life Insurance — Mutual Benefit Certificate — Beneficiary —Trusts—Infants—Estoppel.
    The holder of a mutual benefit certificate attempted to substitute his aunt as beneficiary in place of his sister who had become a nun, and, on learning that an aunt was not allowed to be beneficiary under the rules of the order, had his minor half-brother substituted, at the same time taking from him a trust agreement, in which the aunt joined, that she should have the proceeds of the certificate except 5100 to be paid to the half-brother. The recitals in the agreement and other circumstances showed that compensation to the aunt for her care of the insured was intended, but she was more than twice paid for all her services by other property deeded to her by the assured. Held, that the minor half-brother was not estopped to claim the advantages of a beneficiary while denying the obligations of a trustee.
    Appeal from St. Glair; Law, J.
    Submitted April 9, 1907.
    (Docket No. 42.)

    Decided May 18, 1907.
    Bill of interpleader by the Knights of the Modern Maccabees against Julia Grice and Maurice Walsh to determine the title to a benefit certificate. From a decree for defendant Walsh, defendant Grice appeals.
    Affirmed.

      Complainant filed a bill of interpleader and paid the fund in dispute into court. Defendants by order of the court interpleaded, and from a decree directing payment of the money to defendant Walsh defendant Grice has appealed. The finding made by the court below, which is here set out, states the facts:
    “1. On July 8, 1903, George F. Kroetsch, who was then between 81 and 88 years of age, and whose parents were deceased, went to live with his aunt, defendant Julia Grice, at the home of herself and her husband in the village of Lake City, Missaukee county, Michigan.
    “ 8. At the time mentioned in paragraph 1, said George F. Kroetsch was an invalid, having been sick with the typhoid fever in the fall of 1908, and not having recovered his health. He remained at the • home of his auut until he died on October 10, 1904. During this period he was an invalid, but not all the time confined to his bed, being able to sit up and be around the house a considerable part of the time. However, he was unable during any of this period to do any work, and required constant care and attention, which was given him by his said aunt, defendant Julia Grice. He was well cared for and his necessities well looked after during this time. After his death on October 10, 1904, his funeral expenses were paid by the said Julia Grice. No compensation has been received by Julia Grice for these services and expenses except as hereinafter set forth. The deceased left no estate.
    “3. At the time George F. Kroetsch went to live with the said defendant Julia Grice, he was the owner of 80 acres of land located in Argyle township, Sanilac county, Michigan, worth $1,850. This land was devised to him by Anna Walsh, his mother (who was also the mother of defendant Maurice Walsh), with a condition imposed that he should pay to Argyle township a debt of $94. On the 15th day of January, 1904, he signed and delivered to said Julia Grice a warranty deed of said land. In said deed it is recited after a description of the land:
    “ ‘That the express condition of this deed and the consideration named herein as follows, to wit: that whereas in accordance with a certain will made by Anna Walsh and recorded in the probate court in and for said county of Sanilac which will named the said George F. Kroetsch as legatee and heir to the above named and described lands, and the said conditions named therein (the said will) in relation to a certain sum to be paid to the township of Argyle, Sanilac county, State of Michigan, in the sum of ninety-four dollars by said George F. Kroetsch, which sum is hereby expressly assumed by the said Julia Grice, and for the further consideration that she, the said Julia Grice, is now and will take care and provide and make a home for the said grantor, George F. Kroetsch, who is now an invalid having no home only with the said Julia Grice, and that the said deed and conveyance in fee simple shall become operative and of full force after his death the said George F. Kroetsch.’
    “After this deed was delivered, the defendant Julia Grice collected rent for the 80 acres of land, and after the death of George F. Kroetsch paid the township of Argyle the $94 referred to, and has since had possession of the land and enjoyed the rentals from the same, and claims to own it under said deed. She paid the said George F. Kroetsch for said land nothing except as above set forth. At the time this deed was made and delivered George F. Kroetsch was sick and in a weak condition.
    “4. On July 8, 1903, George F. Kroetsch was the holder of an endowment certificate of $1,000 in the complainant order, a fraternal benefit society. In said certificate his sister, Mary Kroetsch, was named as the beneficiary. He had no father or mother living, and his near relatives consisted of his sister Mary, and his half-brother, defendant Maurice Walsh, then a boy between 15 and 16 years of age. On October 1, 1903, he surrendered this certificate and requested complainant society to issue a new one to him payable to his aunt, defendant Julia Grice. This request was refused, for the reason that under complainant’s laws an aunt could not be a beneficiary of her nephew. On May 17, 1904, George F. Kroetsch applied for disability benefits under his said certificate. His application was approved May 31,1904, and' $50 paid to him by complainant on June 3, 1904, and on May 36, 1904, a disability certificate was issued to him by complainant in lieu of the endowment certificate theretofore held by him; and therein his sister Mary was named as the beneficiary as she had been in the endowment certificate. Soon after this time his sister, Mary, entered a convent and became a nun. Under the laws of complainant order, the only persons eligible to become beneficiaries of George F. Kroetsch were his sister, Mary, and his half-brother, defendant Maurice Walsh.
    “5. On-or about the 13th day of July, 1904, a paper writing, of which the following is a copy, was signed by George F; Kroetsch, defendant Julia Grice, and defendant Maurice Walsh:
    “ ‘ These articles of agreement entered into by and between Julia Grice, of Lake City, Michigan, party of the first part, and Maurice Walsh, of Austin, Sanilac county, Michigan, in this, to wit:
    “ ‘ That, whereas, one George Kroetsch, now an invalid and half-brother to said Maurice Walsh, is now making his home with said Julia Grice of Lake City, and has been for nearly two years last past, and has made application to the great camp of the Modern Maccqbees for a change of beneficiary on policy No. 130392 of the said policy from Mary Kroetsch to the said Maurice Walsh, and that by reason of his infirmities and total disability the said George F. Kroetsch. feeling that his aunt, the said Julia Grice, should be duly compensated and paid for said services willingly given and bestowed upon him during his lifetime and as long as he shall live, and the same care and interest to continue in providing for him a home and medical treatment, and the paying of costs and expenses, board and work of nursing as heretofore given and provided, and that said George Kroetsch does hereby make this request of said half-brother, Maurice Walsh, that these conditions shall be fully complied with upon the said consideration that said policy No. 130392 of the Modern- Maccabees taken out by him, the said George F. Kroetsch, wherein one Mary Kroetsch was named as beneficiary shall be changed and he the said Maurice Walsh to be the beneficiary, and that in the event of the death of said George F. Kroetsch, the said Maurice Walsh shall pay to my aunt, the said Julia Grice, the said insurance so received from the said policy for the reason and consideration herein named with this additional consideration that the said Julia Grice in addition to all of the benefits, expenses, costs, and care received by me the said George F. Kroetsch, she has paid all my assessments for several years back on said insurance, but that the said Maurice Walsh shall receive from the said policy the sum of one hundred dollars, and the balance from the said policy shall be paid by the said Maurice Walsh to my aunt, the said Julia Grice, and I do hereby so authorize, appoint and constitute the said Julia Grice as my true and lawful attorney, to act in my stead in all matters pertaining to said moneys that is to be received from the said policy No. 130392 of the Modern Maccabees, and that she shall give the proper receipt therefor and allow the said Maurice Walsh the sum of one hundred dollars.
    “ ‘In witness whereof, I do hereby subscribe my name.
    “‘George F. Kroetsch.
    “ ‘ Witness: C. L. Goll.

      ‘“As per above conditions, we, the said Maurice Walsh and Julia Grice, do mutually agree that the said conditions herein named by the said George F. Kroetsch shall be binding upon ourselves, our heirs, administrators or assigns, and that in all matters as herein specified, the same shall be and is a part of this contract.
    “ ‘ In witness whereof we have hereunto set our hands and seals this 12th day of July, 1904.
    “ ‘ Julia Grioe.
    ‘ ‘ ‘ Maurice Walsh.
    “‘C. L. Goll.
    “ ‘ Eber G. Hitchens.’
    ‘ ‘ This paper was drawn by Attorney Charles L. Goll, the same person who drew the deed of January 15,1904, heretofore referred to, and was signed by defendant Julia Grice, and by George F. Kroetsch at the Grice home in Lake City, when only Julia Grice, her husband, Charles L. Goll, and said George F. Kroetsch were present. The compensation for the services of the attorney in drawing both the deed and the agreement were paid by Julia Grice. This paper was then given to Richard Grice, husband of defendant Julia, and taken by him to defendant Maurice Walsh, whom he found at the home of the father of Maurice in Sanilac county, Michigan, unloading hay in the barn in company with the father and another man. Mr. Grice then told Maurice, in substance, that his half-brother George, was quite sick at the Grice home at Lake City, and. needed care and attention, and that the arrangement as shown by the writing had been made in order that defendant Julia might receive compensation for such care and attention as had been and would be provided, and also for expenses incurred and to be incurred in connection therewith. Mr. Grice informed Maurice that he would get $100 out of the proceeds of the policy, should his half-brother George die. No mention was made to Maurice or his father by Mr. Grice of the conveyance of the 80 acres of land from George F. Kroetsch to Julia Grice, which had been made on the 15th day of the preceding January, and at that time defendant Maurice had no knowledge that such a conveyance had been made, but supposed that his half-brother, George, still retained the title to this land, which had been devised to him by Anna Walsh, the mother of George Kroetsch and himself, a one-half interest in which would have descended to him had his half-brother died intestate without conveying the land prior to death. With the understanding that it was essential to the welfare of his half-brother, George, and in order that defendant Julia Grice might receive pay for the services she had rendered and would render to him, and for expenses paid and to be paid, and in ignorance of the deed of the land, defendant Maurice Walsh signed this paper. There is no proof that this paper ever came into the possession of George Kroetsch, or was ever seen by him after the same was signed by Maurice Walsh. At the date of this agreement George F. Kroetsch was- quite sick and in a weak condition.
    “ 6. On July 27,1904, George F. Kro'etsch surrendered his disability certificate then held by him in which his sister, Mary, was named as beneficiary, and requested, that a new one be issued to him payable to defendant Maurice Walsh, and such certificate was issued on August 2, 1904, and was in force at the time óf his death and in the possesssion of defendant Julia Grice.
    “7. After the death of George F. Kroetsch, both defendants filed claims with the complainant order.; Maurice Walsh claiming the balance of $950 due on the certificate, and Julia Grice claiming at least $850 under the terms of the paper writing set forth in paragraph 5. This was the first notice the complainant had that any one other than Maurice Walsh, the beneficiary named in the certificate, had any interest in it. This resulted in the commencement of this suit by the filing of a bill of interpleader by the complainant order on March 7, 1906. • After a partial hearing, an interlocutory decree was entered, providing that the defendants do interplead and settle the matter in controversy between themselves, and that on the payment of $950 into the hands of the register of this court the cause be discontinued as to complainant. This is the hearing as provided in the decree of interpleader.
    “ 8. It will not be necessary to make any specific finding as to the value of the services of defendant Julia Grice in caring for George F. Kroetsch, or to determine the amount she has paid out for him. Allowing the widest reasonable latitude to the claims made, and admitting the testimony offered to prove them, some of which is clearly incompetent under section 10212, 3 Comp. Laws, the value of said services and the sum of the expenditures made would not be more than equal to one-half the value of the land deeded to her by George F. Kroetsch as heretofore set forth. Defendant Julia Grice is in no sense a creditor of the estate of George F. Kroetsch.

      “ 9. The signature of defendant Maurice Walsh to the agreement set forth in paragraph 5 was procured from him by a concealment of material facts which should have been disclosed to him and which he was entitled to know. At the date of this agreement, defendant Julia Grice had furnished care and support to George F. Kroetsch for about six months in consideration of the deed to her of the 80 acres of land. The facts regarding this deed and of the arrangement thereunder were not recited nor referred to in the agreement, nor disclosed to Maurice by Richard Grice, the husband of Julia. Whether this should be called positive or constructive fraud on defendant Maurice Walsh is immaterial; it is, at least, one or the other.”
    The conclusions of law are:
    “1. The defendant Julia Grice has failed to establish any legal or equitable right to the. insurance fund in controversy or to any part of it.
    “2. The legal beneficiary named in the benefit certificate at the time of the death of George F. Kroetsch is Maurice Walsh, and he is entitled to receive the $950 due from complainant, and now in the hands of the register of this court, less complainant’s costs as provided in the decree of interpleader heretofore entered, with costs against defendant Julia Grice.”

      F. O. Q-affney (Henry Miltner, of counsel), for appellant.

      Frank T. Wolcott, for appellee.
   Ostrander, J.

(after stating the facts). There is no appeal from the order directing defendants to inter-plead, and it is therefore unnecessary to consider whether in such a case, where one defendant claims all of the fund, the other a part of it, and one is by the laws of the complainant and the statute a proper beneficiary, and is named as such, and the other is not, and cannot be, a beneficiary, and is not named as such in the certificate, a proper case for interpleading is made out.

We affirm the findings of the court below, with this exception: We regard it as entirely immaterial whether defendant Walsh was or was not informed of all the facts preceding his signature of the so-called trust agreement. He had at that time no interest in the benefit certificate. His brother, the assured, had the right to do as he pleased with his farm. It is not found that in parting with that he was defrauded or was unduly influenced; nor does it appear that defendant Walsh would have been made a beneficiary if he had declined to execute the agreement. The reasonable inferences support an opposed conclusion. The finding that his signature to the agreement was procured by fraud, or by concealment of facts which he was entitled to know, is not agreed to.

Defendant Grice knew that the complainant had refused to permit her to be substituted as beneficiary in the certificate, and she knew the reason for such refusal. She was party to a scheme to secure by indirection what could not be directly secured, in violation of the laws of complainant association and of the State policy which permits such associations to exist. She is forced to rely upon the so-called trust agreement, and not upon the certificate. The recitals in the paper writing upon which she relies, as well as the averments in her answer and the testimony in her behalf, permit the conclusion that compensation for her services and interest was intended to be ■secured. Defendant Walsh is the named and legal beneficiary, is an infant, and could be estopped to claim the advantages of a beneficiary, while denying the obligations of a trustee for the benefit of Grice, upon no theory other than the one that Grice remained unpaid. She has been paid.

The decree is affirmed, with costs.

McAlvay, O. J., and Carpenter, Grant, and Blair, JJ., concurred.


text:
    BAUMLER v. FARMERS’ NORTHERN MUTUAL FIRE-INSURANCE CO.
    1. Fire Insurance — Action on Policy —Pleading —Issues — Fraud of Plaintiff.
    In an action on a fire-insurance policy, the fraud of plaintiff is not in issue when not set forth in the notice attached to defendant’s plea, as required by Circuit Court Rule No. 7, subd. b.
    2. Same — Avoidance of Policy — Incumbrances—Estoppel of Company — Misstatement by Agent.
    Where an applicant for a fire-insurance policy correctly states the amount of a mortgage on the property, is unable to read, and signs the application without having it read to him, the fact that the application and policy, prepared by the company’s agent, states the incumbrance at a less sum does not avoid the policy.
    Error to Menominee; Stone, J.
    Submitted April 10, 1907.
    (Docket No. 56.)
    Decided May 18, 1907.
    Assumpsit by Emil Baumler against the Farmers’ Northern Mutual Fire-Insurance Company, Limited, on a policy of insurance. There was judgment for plaintiff, and defendant brings error.
    Affirmed.

      Norwood Bowers, for appellant.

      Mills & Gain, for appellee.
   Carpenter, J.

In the lower court plaintiff recovered a verdict and judgment in a suit brought upon a policy issued to him by defendant insuring against loss by fire a certain building and its contents. One of the grounds of error relied upon by defendant, viz., the fraud of plaintiff, is not open for consideration, because it was not set forth in the notice attached to its plea, as required by Circuit Court Rule No. 7, subd. 6. There is but one other ground, and that is this, viz., that the contract of insur•anee was void, because a mortgage of $1,000 upon the insured property was described in the application and the policy as a mortgage of $200. The testimony of plaintiff tended to prove that he correctly stated the amount of this mortgage to defendant’s agent, who filled out the application and the policy,- arid that plaintiff signed the application without reading it (indeed, he could not read English) and without its being read to him. If this testimony is true — and this was a question which was properly left for the jury to determine — the erroneous description of the mortgage did not avoid the policy. North American Fire-Ins. Co. v. Throop, 22 Mich. 146; Beebe v. Insurance Co., 93 Mich. 514 (18 L. R. A. 481); Russell v. Insurance Co., 80 Mich. 407; Richards v. Insurance Co., 60 Mich. 420; Crouse v. Insurance Co., 79 Mich. 249.

The judgment is affirmed.

McAlvay, C. J., and Grant, Blair, and Ostrander, JJ.3.concurred.


text:
    MAAS v. ANCHOR FIRE-INSURANCE CO. OF CINCINNATI, OHIO.
    1. Fire Insurance — Action on Policy — Pleading—Issues—Misrepresentation op Plaintiff.
    In an action on a fire-insurance policy, defendant cannot rely upon a breach of representation as to the title to the property, where notice of intention so to do is not given by notice attached to the plea, as required by Circuit Court Rule No. 7, subd. b.

    2. Gifts — Parol Gift of Land — Title of Donee.
    A parol gift of land, followed by possession and improvements, makes the donee the equitable owner.
    3. Fire Insurance — Ownership of Property by Insured — Equitable Title.
    Equitable title to land, based on a parol gift, followed by possession and improvements, is a sufficient compliance with a representation of absolute ownership to validate a fire-insurance policy which provides that it shall be void if the subject of insurance be a building on ground not owned by the insured in fee simple.
    4. Same — Forfeiture of Policy — Occupancy of Building.
    Where, in an action on a fire-insurance policy, the evidence showed that the insured and her family occupied the burned house and another at the same time, spending a part of their time in each, and that the burned house was furnished for occupancy and actually occupied by a member of the family at the time it was burned, the question whether the house was occupied by the insured as her home at the time of the fire was for the jury.
    Error to Menominee; Stone, J.
    Submitted April 10, 1907.
    (Docket No. 45.)
    Decided May 18, 1907.
    Assumpsit by Augusta Maas against the Anchor Fire-Insurance Company of Cincinnati, Ohio, on a policy of insurance. There was judgment for plaintiff, and defendant brings error.
    Affirmed.

      Mills & Cain, for appellant.

      Michael J. Doyle, for appellee.
   Carpenter, J.

September 7, 1904, defendant issued to plaintiff a policy insuring against loss by fire a certain dwelling house situated on the west shore of Green Bay, about 10 miles distant from the city of Menominee. The house burned November 16, 1904, and this suit is brought to recover for the loss.

Plaintiff obtained a verdict and judgment in the trial court. Defendant asks us to reverse that judgment upon three grounds. One of those grounds, viz., that the deed of the land upon which the house stood was not in plaintiff’s name, is based upon a breach of a representation contained in the application for said insurance. Defendant cannot rely upon a breach of such representation, because there was nothing in the notice attached to its plea, as required by Circuit Court Rule No. 7, subd. d, to indicate its intention to do so.

There remains for our consideration the contentions of defendant that a verdict should have been directed in its favor upon these two grounds: (1) That she did not own the land upon which the building stood; (2) that she did not occupy the house as her home. These contentions will be considered separately.

The ownership of the land. Plaintiff stated in her application for the insurance that she was the absolute owner of the property, and by. its terms the policy was “void * * * if the subject of insurance be a building on ground not owned by the insured in fee simple.” The facts concerning said ownership are correctly stated by the learned trial judge as follows:

“In the year 1897 Charles Maas, the son of the plaintiff, being the owner of this entire property, gave [by parol] the same * * * to his mother. That she immediately went into possession and has made valuable improvements thereon * * * to the amount of more than a thousand dollars. That she has continued to own and occupy the premises in a general way — I am not speaking of the actual occupancy as a dwelling house, but to qwn the property — I may say, from that time down to this. She has paid the taxes thereon.”

.And the trial judge decided that plaintiff—

“Having received this * * * gift, * * * having gone into possession * * * and made these valuable improvements, that the full equitable title was vested in her, * * * and that her son held the legal title as her trustee, and therefore that her answer was correct when she said that she was the owner.”

Defendant urges that this conclusion was wrong for two reasons: (a) That the parol gift followed by possession and improvements did not vest in plaintiff the equitable title; (6) that plaintiff’s ownership of the equitable title would not comply with the representation and the policy; that these required plaintiff to possess the legal title. These objections are easily answered, (a) That a parol gift of land followed by possession and improvements makes the donee the equitable owner is settled by our own decisions. Potter v. Smith, 68 Mich. 212. See, also, Twiss v. George, 33 Mich. 253; Lamb v. Hinman, 46 Mich. 112; Welch v. Whelpley, 62 Mich. 15; Hawkes v. Slight, 110 Wis. 125; Frame v. Frame, 32 W. Va. 463 (5 L. R. A. 323). (b) That plaintiff’s ownership of the equitable title was a compliance with the representations and the agreement in the policy is also settled by our own decisions. Dupreau v. Insurance Co., 76 Mich. 615 (5 L. R. A. 671); Farmers’ Mut. Fire-Ins. Co. v. Fogelman, 35 Mich. 481. We therefore overrule the first contention of defendant.

We now consider the contention of defendant that the house was at the time of the fire, and had been for 10 days prior thereto, contrary to the provisions of the policy, vacant and unoccupied. Plaintiff contends that she was actually occupying the house at the time of the fire as a dwelling house. This issue of occupancy was submitted to the jury, who found for the plaintiff. Defendant insists that there was no testimony to justify this verdict. The house was situated on a farm which plaintiff and her family themselves cultivated. They ha'd a home in the city of Menominee, at which, I think, it may truly be said plaintiff spent more than one-half of her time. The testimony shows, however, that she and other members of her family were at the farm much of the time, engaged in carrying on farming operations. One witness says they were there “a few days in every week. They slept there and ate there [in the house] during that time.” The house was furnished with beds, stoves, chairs, and tables for their accommodation, and plaintiff’s husband was in the house at the time the fire occurred. Plaintiff testified that she and her family regarded the house as their home. We think from this evidence that the jury might have inferred, as the learned trial judge decided, that plaintiff was residing in two houses, remaining “part of the time in one and part of the time in the other, and that both might be considered dwelling houses,” and that the question of her occupancy was therefore properly submitted to the jury.

The judgment is affirmed.

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