author: Montgomery, J. Grant and Hooker, JJ.

text:
    WILSON v. CAMPBELL.
    1. Mortgages — Security for Negotiable Paper — Payment.
    The maker of a negotiable note secured by mortgage cannot discharge his liability by payment to one not the holder, or authorized by the holder to receive payment.
    3. Same — Authority of Agent.
    The fact that a mortgagee has been accustomed to send the interest coupons to a mortgage company for collection does not constitute the latter an agent for the collection of the principal debt.
    3. Same — Mortgagee as Stockholder.
    Nor does the fact that the mortgagee is a stockholder in the company operate to confer upon it any such authority.
    4. Same — Negotiability of Instruments — Time of Payment.
    The negotiability of a promissory note is not destroyed by a provision therein giving an option to the holder to declare the whole amount due upon default in payment of an installment of interest, nor by a provision in an accompanying mortgage giving a like option in case of nonpayment of taxes by the mortgagor.
    5. Same — Certainty as to Amount — Payment of Taxes.
    A promissory note secured by, mortgage is not rendered nonnegotiable by a provision in the latter requiring the mortgagor to pay all taxes and assessments upon the mortgaged premises, where the same obligation rested upon him by law at the time the instruments were executed, independent of any such stipulation.
    6. Same — Effect of Subsequent Legislation.
    In such case, legislation subsequently passed, imposing upon the mortgagee the duty of paying a portion of the taxes, will not render a note nonnegotiable which was negotiable when made. '
    7. Recording Laws — Bona Fide Purchaser — Assignment op Mortgage.
    One who takes an. assignment of a mortgage while the records show the existence of a prior mortgage upon the same property to his assignor will be subordinated to the lien of the prior mortgage in case it is in the hands of an assignee, although there is no record of the prior assignment.
    Appeal from Grand Traverse; Corbett, J.
    Submitted April 24, 1896.
    Decided July 31, 1896.
    Bill by Robert H. Wilson against Elizabeth A. Campbell to compel the discharge of a mortgage, and cross-bill by defendant against complainant, Mrs. John.F. Nichols, and others, to foreclose the same mortgage. From a decree for complainant on the original bill, and dismissing 'the cross-bill, defendant Campbell appeals.
    Reversed.

      Dodge & Povell, for complainant Wilson and defendant Nichols.

      Lyon & Dooling, for appellant.

       In Fuller v. Kane, ante, 549, it is held that a general agreement to pay taxes does not bind the mortgagor to pay those assessed against the mortgagee’s interest under laws subsequently enacted.

   Montgomery, J.

The hearing is on a bill filed by the complainant to compel the discharge of a mortgage executed by Freeling H. Potter and wife to defendant, and on a cross-bill filed to foreclose the mortgage. The complainant has succeeded to the title of Potter. The facts are that on January 27, 1886, Potter made his promissory note, payable to Edwin E. White or bearer, for $550, due April 1, 1892, with coupons attached, representing the installments of interest. Principal and interest were made payable at the office of S. S. Walker, St. Johns, Mich. The note contained a provision that, in case of default in the payment of interest continuing for 30 days, the whole principal and interest unpaid should, at the option of the holder of the note, become due. This note was secured by á mortgage with a condition for the payment of the principal and interest of the note, and all taxes and assessments of whatever nature which may be levied upon the described premises as soon and as often as the same nlay become due and payable. The mortgage contained the following agreement:

“Should any default be made in the payment of the said interest, taxes, assessments, or any part thereof, on any day whereon the same is made payable, as above expressed, and should the same remain unpaid and in arrears for the space of 30 days, then and from thenceforth- — -that is to say, after the lapse of said 30 days — -the aforesaid principal sum of five hundred and fifty dollars, with all arrearages of interest thereon, and all taxes, assessments, and — unpaid, shall, at the option of said obligee, his executors, administrators, or assigns, become and be due and payable immediately thereafter, although the period above limited for the payment thereof may not then have expired, anything hereinbefore contained to the contrary notwithstanding.”

The note and mortgage were assigned to the defendant June 14, 1887, and possession of the same delivered to her. She has since retained possession of the securities at her home in Skaneateles, N. Y. At about the date of the maturity of the coupons, the defendant was accustomed to detach the coupons, and send them forward to Walker & White and the Michigan Mortgage Company, Limited, for collection. The assignment of the mortgage to defendant was not recorded until April 13, 1894.

October 3, 1888, Potter and wife sold the mortgaged premises to the complainant, he taking subject to the mortgage. At about the date of the maturity of the mortgage, complainant, supposing, as he testifies, that the Michigan Mortgage Company, Limited, owned this mortgage, applied for a loan of an additional sum, and negotiations culminated in his executing, under the date of April 1, 1892, a note and mortgage in the sum of $700, payable to the Michigan Mortgage Company, Limited. This mortgage was, on the 27th of April, 1892, assigned to Mrs. John F. Nichols, who is made defendant in the cross-bill.

It appears that the defendant, Mrs. Campbell, became a stockholder in the Michigan Mortgage Company, Limited, in 1891. The court below decreed a discharge of defendant’s mortgage, and stated the reasons as follows:

“The course of dealing between Mrs. Campbell and the Michigan Mortgage Company, Limited, in submitting to the company the interest coupon notes for collection as they matured, her neglect to record her assignment until after the execution of the second mortgage of $700, April 1, 1892, and the fact that she was a member and stockholder of the partnership association Michigan Mortgage Company, Limited, at the date of the execution of the said $700 mortgage, estop her from challenging the authority of said company to receive payment on her mortgage, inasmuch as the reception of such payment by said company was an act within the scope of its authority.”

Defendant, Mrs. Campbell, appeals.

The original bill asserts, and apparently bases the claim for relief on the statement, that the Michigan Mortgage Company, Limited, was duly appointed by the defendant, Mrs. Campbell, as her duly-authorized agent to receive, accept, and account for any and all moneys received in payment upon said mortgage, either as interest or principal; and avers payment to her agent, the mortgage company, for the defendant. The sworn answer of defendant denies such agency. The bill does not proceed upon the theory that the complainant was misled by defendant’s failure to record the assignment, but, as Mrs. Nichols is brought in to answer the cross-bill, and entitled to be heard, we find it necessary to treat of this question. In Williams v. Keyes, 90 Mich. 296, we held, following Dutton v. Ives, 5 Mich. 515, that the holder of a negotiable security is alone the one prima facie entitled to receive the payment, and that the maker is not authorized to assume that negotiable paper secured by mortgage has not been transferred. See, also, Jones, Mortg. § 956. However the failure to record the assignment may affect one subsequently deriving title or right through the mortgagee, the maker of a negotiable note secured by a mortgage cannot discharge his liability by payment to one not the holder, or authorized by the holder to receive the payment. We are not able to discover that the defendant ever authorized the Michigan Mortgage Company, Limited, to collect the principal of this note, or to collect more than the interest coupons, on the same being forwarded to it for the purpose. In this respect the case is so similar to others decided by this court that we think it unprofitable to discuss this feature here at length. See Joy v. Vance, 104 Mich. 97, and cases cited; Bromley v. Lathrop, 105 Mich. 492; Trowbridge v. Ross, Id. 598.

We are at a loss to understand how the fact that the defendant is a stockhol4er in the Michigan Mortgage Company, Limited, affects her right to assert that the officers of the company exceeded their authority in accepting payment of the mortgage. To the extent that she contributed to the stock of the corporation it may be said that she risked her investment, and relied upon the honesty of the managers; but beyond this the company was not her agent by mere force of the fact that she was a stockholder.

If the note and mortgage were negotiable, it follows that the complainant has not made a payment to one either in fact or apparently clothed with authority to receive it. But it is contended that the note is not negotiable, the ground being that the note gives an option to declare the whole amount due in case of default in payment of an installment of interest; and, while the point is not made, the question suggests itself whether the similar provision contained in the mortgage; giving a like option in case of default in payment of taxes, renders the security nonnegotiable, and, as this question is discussed in Brooke v. Struthers, now pending before us (ante, 562), we consider both questions.

In Littlefield v. Hodge, 6 Mich. 326, it was held that a note in form negotiable is none the less negotiable when secured by a mortgage containing provisions not repugnant to it. We apprehend the test in such cases is, are the provisions' of the mortgage such as to introduce uncertainty as to time or amount? What elements of uncertainty inconsistent with negotiability here exist, if any ? Is there such uncertainty as to time as renders the note nonnegotiable ? It seems to me very clear that the answer must be in the negative. Carlon v. Kenealy, 12 Mees. & W. 139; German Mut. Ins. Co. v. Franck, 22 Ind. 364; Walker v. Woollen, 54 Ind. 164 (23 Am. Rep. 639); Cota v. Buck, 7 Metc. (Mass.) 588 (41 Am. Dec. 464); Kiskadden v. Allen, 7 Colo. 206; Dobbins v. Oberman, 17 Neb. 163; Ernst v. Steckman, 74 Pa. St. 13 (15 Am. Rep. 542); Charlton v. Reed, 61 Iowa, 166; Chicago Railway Equipment Co. v. Merchants’ Nat. Bank, 136 U. S. 268; Cisne v. Chidester, 85 Ill. 523. In Garlon v. Kenealy it was determined that a note payable in installments, subject to a condition that, on default being made in payment of the first installment, the whole amount shall become due, is assignable within the statute 3 & 4 Anne, chap. 9. Parke, B., in deciding the point, said: “Almost every note payable by installments has such a condition. It is not a contingency; it depends on the act of the maker himself, and on his default it becomes a promissory note for the whole amount.” In Ernst v. Steckman a note payable 12 months after date, or before, if made out of the sale of Coffman’s Improved Broadcast Seeding Machine, was held negotiable. The case of Walker v. Woollen is to precisely the same effect, as is also the case of Charlton v. Reed.

In Dobbins v. Oberman the note read: “On March 1, 1883, for value received, I promise to pay to Anna M. Wilson, or order, four hundred dollars, with interest from this date. This note shall become due immediately upon Anna M. Wilson delivering possession to me of the northwest quarter of section 12,” etc. ' This instrument was held negotiable, the court finding that it contained a promise to pay to Anna M. Wilson, or order, a sum certain absolutely and at all events; and adding: “It matters not, then, that it also contains a promise to pay sooner than the general date of payment upon the happening of an uncertain event.”

In Chicago Railway Equipment Co. v. Merchants’ Nat. Bank, 136 U. S. 268, it was held that a recital that the note in suit was one of a series, and that, in default of payment of any one of the series, the note in suit should become due, did not render the note nonnegotiable, the same containing a promise to pay at a certain definite date, at which it became due at all events. The case contains a review of the authorities and an interesting discussion by Mr. Justice Harlan.

The present case is unlike Brooks v. Hargreaves, 21 Mich. 254, as in that case the maturity of the note depended upon the volition of a third person not a party to the note. In Story v. Lamb, 52 Mich. 525, an option was given to the payee to take possession of the property which was the consideration of the note in case of default, or demand payment of the note, the title to the property being retained in the payee. In this respect the case is like Harkness v. Russell, 118 U. S. 663, which case is distinguished in Chicago Railway Equipment Co. v. Merchants’ Nat. Bank, 136 U. S. 282. In Second Nat. Bank v. Wheeler, 75 Mich. 546, the payee was given the right to extend the time or renew. Conrad Seipp Brew ing Co. v. McKittrick, 86 Mich. 191, follows Cayuga Co. Nat. Bank v. Purdy, 56 Mich. 6, and must rest upon the view that the introduction into a promissory note of extraneous provisions must render the note nonnegotiable, as in that case there was an absolute promise to pay. Whether this be viewed as a departure or not, such a rule cannot be applied to provisions in a mortgage collateral to a negotiable note. As to the certainty of time required, I think it sufficient if a time be fixed which must inevitably happen. Mattison v. Marks, 31 Mich. 421 (18 Am. Rep. 197); Daniel, Neg. Inst. §§ 47, 48, 52; Markey v. Corey, 108 Mich. 184.

There is no uncertainty as to the amount stipulated to be paid. The engagement to pay all taxes and assessments adds nothing to the obligation of the mortgagor. The obligation rests upon him independently of any stipulation on the subject, and his failure to meet the obligation gives the mortgagee the right to discharge the lien for the purpose of preserving his security, and add the amount to the mortgage debt. 2 Jones, Mortg. §§ 1137, 1683; Connecticut Mut. Life Ins. Co. v. Bulte, 45 Mich. 122. It is a radical mistake, therefore, to consider this an obligation to pay the mortgagee so much in addition as the taxes and assessments amount to. The obligation is, in the first instance, to pay to the public authorities authorized to receive the amount, and it is only by implication, if at all, that the indebtedness is ever to be added to the mortgage.

At the time this mortgage in question was executed there was, under the law, no duty resting upon the mortgagee to pay the tax on any portion of the mortgaged premises, and we think it cannot be said that subsequent legislation which for a time relieved the mortgagor of a portion of the burden, and imposed it upon the mortgagee, should be so construed as to render an instrument nonnegotiable which was, when made, negotiable. As the parties then viewed it, there was no uncertainty as to the amount. The case differs from Carmody v. Crane, ante, 508, as in that case the contract itself contemplated that taxes might be imposed on the mortgagee’s interest, and provided for their payment by the mortgagor, and this engagement was embodied in the note, bringing the case directly within the rule of Cayuga Co. Nat. Bank v. Purdy, 56 Mich. 6, and the cases which have followed it, holding that it is incompetent to interpolate into negotiable notes provisions super-adding duties to be performed by the maker, or additional obligations other than the payment of a sum certain at maturity. As has been stated above, we do not think this limitation precludes the parties from making provision for the security of the note by a collateral mortgage. The clause in the' mortgage is clearly not open to a construction which entitles the mortgagee to foreclose for the amount without himself paying the taxes, although he may, for the mortgagor’s default in that regard, declare the whole amount due.

The question of priority between the mortgages of Mrs. Nichols and defendant is also involved. The mortgage of Mrs. Campbell was prior in point of time, and was duly recorded. If Mrs. Nichols is to be given priority, it must be because the record showed this mortgage in Edwin E. White, and because she received an assignment of a mortgage executed by the Michigan Mortgage Company, Limited, which Edwin E. White signed as treasurer. The mortgage company listed the Wilson mortgage and others, and stated that it was good security. The letter accepting this mortgage was as follows: “I think the $?00 mortgage, Grand Traverse county, would suit me if all right, and prompt payment of interest; but, of course, I must trust to you and your judgment. I send check at this date.” This letter was sent to Mr. White, and in response to it the Wilson mortgage was inclosed her. She undoubtedly assumed that there was no prior incumbrance. Had she examined the record, she would have discovered a mortgage to Mr. White. She must, therefore, be held bound by notice of this. The case is certainly not stronger for her than, it would have been had White become the purchaser of the land, and attempted to convey or incumber the fee. Having constructive knowledge of the existence of this mortgage, Mrs. Nichols was also chargeable in law with the further notice that the mortgage is a lien in the hands of any person to whom it may have been legally transferred, and that the record of such transfer is not necessary to its validity, nor as a protection against the purchaser of the property mortgaged, or any other person than a subsequent purchaser in good faith of the mortgage itself or the note or debt'secured by it, but, rather, that one purchasing the premises from the mortgagee would take them subject to the lien of the mortgage, irrespective of the ownership of it, unless the mortgagee was the owner. The knowledge and notice would, in case of a direct purchase from White, have made it her duty,- in the exercise of proper diligence, to inquire whether her vendor, the mortgagee, was still the owner of the mortgage; and her omission to do so would have deprived her of the protection of a bona fide purchaser. 1 Jones, Mortg. § 474; Purdy v. Huntington, 42 N. Y. 334 (1 Am. Rep. 533); Burhans v. Hutcheson, 35 Kan. 635 (37 Am. Rep. 374); Oregon, etc., Investment Co. v. Shaw, 5 Sawy. 336. See, also, Haescig v. Brown, 34 Mich. 503; Fletcher v. Carpenter, 37 Mich. 413.

The decree of the court below will be reversed, and the mortgage of Mrs. Campbell be declared a subsisting claim against the maker of the note, and a lien upon the realty, entitled to priority over the mortgage of Mrs. Nichols. Appellant will recover costs in both courts, limited, however, to costs in a single suit.

Moore, J., concurred with Montgomery, J.

Grant and Hooker, JJ.

We concur in the above opinion because it is ruled by the case of Brooke v. Struthers, ante, 562.

Long, C. J., did not sit.

       As bearing upon this question, see, also, Pritchard v. Kalamazoo College, 83 Mich. 587; Cook v. Foster, 96 Mich. 610; Gibbs v. Johnson, 104 Mich. 130.


source: Caselaw Access Project

author: Montgomery, J.

license: Public Domain

text:
    WARNER v. DELBRIDGE & CAMERON CO.
    1. Foreign Corporations — Liability of Resident Members.
    One who becomes a member of a foreign corporation subjects himself to such laws of the government of its situs as affect its powers and obligations.
    2. Same — Mutual Insurance.
    Thus, an assessment against a Michigan member of a Minnesota mutual fire insurance company, who has contracted to pay for losses and expenses only, although including an item for unearned premiums on cash policies, which would invalidate the assessment if the contract were to be regarded as a Michigan contract (Detroit, etc., Ins. Co. v. Merrill, 101 Mich. 393), may be enforced in the courts of this State, since such an assessment is legal under the statutes of Minnesota, as interpreted by the courts of that State.
    3. Same — Judgment—Conclusiveness.
    To what extent a judgment of a court of one State, providing for an assessment against the stockholders of an insolvent corporation, is conclusive upon the courts of another State, — queer e.

    4. Same — Appeal—Objections not Raised Below.
    An objection that a foreign insurance company was not shown to have been authorized to do business within the State comes too late on appeal to prevent the enforcement of an assessment upon a premium note.
    Error to Wayne; Donovan, J.
    Submitted June 11, 1896.
    Decided July 31, 1896.

      Assumpsit by Willard E. Warner, ancillary receiver in Michigan of the Minneapolis Mutual Eire Insurance-Company, against the Delbridge & Cameron Company, upon a premium note. From a judgment for defendant on verdict directed by the court, plaintiff brings error.
    Reversed.

      G. E. Warner, for appellant.
    Ed. E. Kane, for appellee.

      A note collating the authorities upon this subject will be found with this case, as reported in 34 L. R. A. 701.

   Montgomery, J.

On the 3d of April, 1890, defendant applied for and received a policy of insurance in the Minneapolis Mutual Fire Insurance Company, and executed and delivered the following agreement: •

“Minneapolis, Minn., April 3, 1890.
“For value received, in policy No. 01,037, dated the 3d day of April, 1890, we promise to pay the Minneapolis Mutual Fire Insurance Company the sum of three hundred and seventy-five dollars, by installments, at such times as the directors of said company may order and assess, for the losses and expenses of said company, pursuant to its charter and by-laws. It is hereby expressly understood and agreed that this note is not transferable, and that there is no liability beyond the face amount thereof.
“No. 01,037.
“Delbridge, Cameron & Dingeman Co.”

On the 18th of December, 1890, an application was made by a policyholder, in the district-court of Hennepin county, Minn., alleging the insolvency of the company, and praying»for the appointment of a receiver, and the distribution of its assets among the creditors entitled thereto. On the 24th of January, 1891, a decree passed adjudging the insurance company insolvent, and appointing a receiver. On the 19th of May following, an order making an assessment of 50 per cent, upon all premium notes and policy obligations was made; but this order was subsequently set aside as illegal, and a petition was filed showing the financial condition of the company, and the necessity for an assessment; and February 3, 1894, an order was made authorizing an assessment of 100 per cent., or as much thereof as might be necessary to pay the claims which accrued against the said insolvent company during the time said policies were in force, to be levied upon the balance due upon each and all of said premium notes and policy obligations at the time of the appointment of a receiver for the insolvent company, in 1890. This order further directed that upon this assessment the receiver should credit and deduct the amount of any special assessment theretofore made by the insurance company, and actually paid by the makers of the premium notes and policy obligations, and also the amount actually paid upon the assessment of 50 per cent, theretofore ordered by the court. The items included in this assessment of 100 per cent, were for losses, salaries, unearned premiums on cash policies, and miscellaneous claims. On the application of the complainant in the original suit, made to the circuit court for the county of Wayne, in chancery, setting forth the proceedings in Minnesota, plaintiff was appointed an ancillary receiver in the State of Michigan. This suit was brought against the defendant to recover, upon the premium note mentioned, the 100 per cent, assessment. On the trial, the circuit j udge directed a verdict for defendant, on the ground that the assessment was void, for the reason that it included an assessment for unearned premiums; acting upon the authority of Detroit, etc., Ins. Co. v. Merrill, 101 Mich. 393.

If this contract is to be treated as a Michigan contract, the holding should be sustained, unless it be held that the order making the assessment, made at the situs of the home company, is conclusive, not only as to the authority to make the assessment, but as to the extent of the defendant’s liability. This question was recently before the court in the case of Mutual Fire Ins. Co. v. Phœnix Furniture Co., 108 Mich. 170, and the conclusion was then reached that the decision of the court of a sister State is binding upon the courts of this State in all these respects. This conclusion was based upon the constitutional provision that full faith and credit shall be given in each State to the public acts, records, and judicial proceedings of every other State. U. S. Const. art. 4, § 1. And an examination of the decisions of the Federal Supreme Court led us to the conclusion that the stockholder of a corporation is so far an integral part of the corporation that, in view of the law, he is privy to the proceedings touching the body of which he is a member, and that a determination that an assessment upon the policy holders in a certain amount- and for certain obligations of the company should be made was final and conclusive, and could not be attacked collaterally when suit was brought upon such assessment in another State. In reaching this conclusion, the question involved being a federal question, we felt ourselves bound by the determination of the Federal Supreme Court in Hawkins v. Glenn, 131 U. S. 319, and Glenn v. Liggett, 135 U. S. 533. But since the decision of this court in Mutual Fire Ins. Co. v. Phœnix Furniture Co. the question has been again before the Federal -Supreme Court, and the doctrine of the cases upon which-we relied for our decision limited; and in Great Western Tel. Co. v. Purdy, 162 U. S. 329, it is held that an order making a call or assessment upon all stockholders of a corporation who have not paid their shares in full is merely such a call as the directors might have made before the matter was brought within the court’s jurisdiction, and is not a judgment against the particular stockholder, so as to be entitled to such full faith and credit under the Constitution and laws of the United States, and that in such action defendant is entitled to rely on any defense which he might have to an action upon the contract of subscription.

Plaintiff, however, contends that this is a Minnesota contract, and that under the statute of Minnesota, as interpreted by the supreme court of that State, an assess ment for unearned premiums upon nonparticipating policies was legal. The contract by which the insured became a member included, not only the note, but the policy, which contained the following provision:

“The insured heretofore named becomes a member of this company, and agrees to pay them the premium annually, during the life of this policy, and, in addition thereto, such sum or sums, in no event to exceed in the aggregate.five times the amount of said annual premium, at such time or times, and in such manner, and by such installments, as the directors of said company shall assess and 'order, pursuant to its charter and by-laws and' the laws of the State of Michigan.”

It is suggested by defendant’s counsel that it is only for assessments for losses and expenses made according to the laws of Michigan that the defendant is made liable by its contract. It is difficult to understand the reference to the laws of the State of Michigan. This was certainly known by both parties to be a Minnesota corporation, and we are aware of no provision of the laws of this State which relates to the assessments authorized by such corporation. We think, therefore, that the contract must be treated as a Minnesota contract. Every corporation necessarily carries its charter wherever it goes; and, while it may be restricted in the use of some of its powers while doing business away from its corporate home, every person who deals with it everywhere, and particularly one who becomes a member of the corporation, is bound to take notice of the provisions which have been made in its charter, and subjects himself to such laws of the government of its situs as affect the powers and obligations of the corporation. See Canada Southern R. Co. v. Gebhard, 109 U. S. 537; Relfe v. Rundle, 103 U. S. 225.

The statute of Minnesota under which this company was organized authorized the company to engage in business and to receive premium notes, and provides that—

“Every person effecting insurance in any company organized under this act, and the heirs, executors, and assigns of such person continuing to be so insured, shall thereby become members of such corporation during the period of insurance, and shall be bound to pay for losses and such necessary expenses as may accrue in the management of such company, in proportion to the amount of such premium note.”. Gen. Stat. 1894, § 3261.

And in another section it is provided that whenever the capital stock of any company shall amount to the sum of $200,000, of which amount not less than $40,000 shall be actual funds, such company may assume risks on the “all-cash” plan, and issue policies against loss of damage by fire or lightning to an amount not exceeding 5 per cent, of its capital. Id. § 3264. This statute has been construed by the supreme court of' Minnesota in the case of In re Minneapolis Mut. Fire Ins. Co., 49 Minn. 291, in which the court say:

‘ ‘ This construction of the statutes and of the contracts under consideration leads also to the conclusion that the premium notes of the members of the corporation, which constitute its ‘ contingent fund,’ may be resorted to, if necessary, to pay the unearned premiums on policies of simple (not mutual) insurance, whose holders sustain no other relation to the corporation than that of parties who had thus contracted with it. Such notes constitute a part of the ‘capital’ of the corporation, and comprise a part of the ‘ capital ’ required by thé act of 1885 to be held by the company as a condition of its right to engage in this kind of insurance. They are to be deemed a part of the fund upon the credit of which such contracts of insurance are entered into.”

It is to be noted that in Detroit, etc., Ins. Co. v. Merrill, supra, the policy was a policy upon the mutual plan, and the unearned premiums were unearned premiums on mutual policies. We think the statute of Minnesota, as construed by the supreme court of that State, must be deemed to be the law of the contract between the parties to this engagement, and that, under this law, an assessment for unearned premiums upon cash policies is within the contract.

These considerations would dispose of the case were it not that defendant’s counsel contends that, even if the court was in error upon this question, the plaintiff failed to make a case. We have examined the points suggested by counsel, and deem it unnecessary to discuss them at length.

We think the construction of the order appointing plaintiff receiver which counsel makes is too technical. Plaintiff was appointed receiver of all equitable interests and choses in action, and of all property and assets, whether therein designated or not, belonging to said defendant corporation within the State of Michigan, and of all books, papers, property, and documents, of any and every description, belonging to said defendant, and with full power and authority to sue in his own name as such receiver, or in the name of defendant corporation, for all assets, money, or property and obligations due from residents of the State of Michigan to the defendant.

The suggestion that it was not proved that the foreign insurance company had authority to do business in the State of Michigan is made for the first time in this court, and, we think, should not control the decision.

As to the contention that the premium note was obtained by fraud, this contention is based upon certain papers which were found in the safe of. the defendant company by a witness who personally knew nothing of their origin; and there was no evidence to show the manner in which they came into the possession of the defendant, nor was their execution or authenticity proven. Under these circumstances, we are certainly not in a position to say that fraud was conclusively proven.

We think the judgment should be reversed, and a new trial ordered.

Long, C. J., Hooker and Moore, JJ., concurred. Grant, J., did not sit.


author: Grant, J.

text:
    BRUSH v. BEECHER.

    1. Lease — Perpetuities —Covenant por Renewals — Construction.
    A lease will not be construed as creating a perpetuity by renewal at the option of one of the parties, unless such appears from clear and unequivocal language ,to have been the intent.
    3. Same.
    A lease for a term of years, providing that the lessors, their “executors, administrators, or assigns,” may at their election, at the end of the term, purchase buildings erected by the lessee at a valuation not to exceed a specified'amount, and that, if they elect not to make such purchase, the lease shall continue for a similar term at a rental value to be determined by a reference, at the expiration of which, and of each succeeding term of like length, the same right shall exist, and the same result follow its non-exercise, and that if the lessee, his “executors, administrators, or assigns,” do not keep all the conditions of the lease, it shall immediately cease and be utterly void, — does not provide for any renewals beyond the lives of the parties thereto.
    Error to Wayne; Frazer, J.
    Submitted April 22, 1896.
    Decided October 6, 1896.
    Alfred E. Brush presented a claim for rent in the probate court against the estate of Luther Beecher, deceased. The claim was contested by George L. Beecher and Luther S. Trowbridge, the administrators, and was disallowed, whereupon claimant appealed to the circuit court. From a judgment for defendants, claimant brings error.
    Affirmed.

      The following is the finding of facts made by the court before which the case was tried:
    Luther Beecher died September 16, 1892. At the time of his death he was the tenant under three leases which were executed by Edmund A. Brush, the ancestor of plaintiff, one in 1848, and the others later. Each lease was for the specified term of five years, and, after the usual terrhs of leases, contained the following :
    “ And it is further covenanted by and between the parties hereto that, at the expiration of said term of five years, the parties of the first part, their executors, administrators, or assigns, shall have the right, in their election, to purchase and take of and from the party of the second part, his executors, administrators, or assigns, the buildings erected by him or them, or being on said premises, at a valuation thereof, not to exceed $10,-000, to be made by three disinterested persons, to be chosen in the usual manner, and upon such purchase to re-enter upon said premises, and the same to have again as in their former estate and right. And if the parties of the first part, their executors, administrators, or assigns, elect not to make such purchase, then this lease, at the then rental value of the premises, to be determined by a reference in the manner above set forth, and upon the other terms and conditions above set forth, shall stand continued for another term of five years. And in like manner, at every expiration of every succeeding term of five years, the same election as above reserved by the parties of the first part, their executors, administrators, or assigns, shall be had; and if the buildings and improvements, as above limited, are not purchased and taken, then this lease, at the then rental value, to be determined as above prescribed, and upon the other terms and conditions above set forth, shall stand continued for another term of five years. And that the buildings and improvements placed or made upon said premises shall remain thereon as a security for the execution of the covenants herein contained on the part of the Said party of the second part, unless said lessors, or some persons, authorized thereto, shall consent in writing to the removal of the same, or any part thereof: Provided, always,
      and these presents are upon this condition, that if it shall happen that the rent hereby reserved, or any part thereof, shall be behind and unpaid after the same ought .to be paid according to the reservation thereof, or if the party of the second part, his executors, administrators, or assigns, shall not well and truly observe, keep, and perform all and singular the covenants, conditions, and agreements herein contained on his and their part to be observed, kept, and performed, according to the true intent and meaning thereof, then, and in any of the said cases, immediately upon the happening thereof, this lease, and everything herein contained on the part of the parties of the first part thenceforth to be done and performed, shall ceáse, determine, and be utterly void, anything herein contained to the contrary notwithstanding.”
    At the time of Mr. Beecher’s death, he was in possession of the parcels of land described in said leases, and there were situated on said land brick buildings known as the “Globe Hotel.” The premises were not occupied by any person, but these buildings were locked up, and the keys were in the possession of Luther Beecher. He was the lessee of the property. After his death, Gen. Luther S. Trowbridge and George L. Beecher, a son of the deceased, were appointed administrators of his estate, and as such came into the possession of the keys to the Globe Hotel; and these keys remained in their possession until June 29, 1893, when they tendered the' keys to Alfred E. Brush, who refused to receive them, but they were left on his table, in his presence, at his residence, and were not returned to the administrators. Alfred E. Brush is the son of Edmund A. Brush, deceased, and as such has succeeded to the title of his deceased father, and is owner of the fee of the land described in the leases. At the time of the death of Luther Beecher, he was paying rent under these leases to the Brush estate, or to Alfred E. Brush, the owner of the property, at the rate of $1,500 a year, but was in arrears for the year commencing July 1, 1891. Before Luther Beecher died, the executors of the Brush estate brought suit against him to recover the rent for the year commencing July 1, 1891. This suit was revived after the death of Luther Beecher, and it terminated with the decision reported in 98 Mich. 235. After that decision the administrators of Luther Beecher paid the rent at that rate down to the 30th of June, 1893, with the exception of the city taxes which were assessed on it in 1892; said taxes amounting to $564.65. Said taxes were paid by Alfred E. Brush June 1, 1893. When the keys were tendered to Alfred E. Brush, they were left on his table; but he positively refused them, and they were not carried away because he could not force Gen. Trowbridge to carry them away, but the keys were left there. The administrators of the estate of Luther Beecher endeavored to surrender these leases at that date, and Mr. Brush refused to receive the surrender. They endeavored to terminate the leases at that date, and offered to surrender possession, and to give up all their claims to the improvements on the property. They served on Alfred E. Brush a written paper to that effect, but Mr. Brush refused to receive the surrender so offered. The administrators of the estate of Luther Beecher have refused to pay the following installments of rent, which became due on these leases subsequent to June 30, 1893, viz.:
    1893.
    July 1. To one quarter’s rent in advance_________ $375
    Oct. I.- To one quarter’s rent in advance......... 375
    1894.
    Jan. 1. To one quarter’s rent in advance......... 375
    April 1. To one quarter’s rent in advance_________ 375
    July 1. To one quarter’s rent in advance......... 375
    Oct. 1. To one quarter’s rent in advance_________ 375
    1895.
    Jan. 1. To one quarter’s rent in advance......... 375
    $2,625
    Counsel for the claimant and appellant insisted that the leases were still in force, and that he was entitled to recover from the Beecher estate the above amount of rent, with interest on each installment to the date of judgment. Counsel for the Beecher estate insisted that the leases were terminated by • the surrender of possession (without making any claim for improvements) made by the administrators of the estate of Luther Beecher on June 29, 1893, and also insisted that the leases had terminated by their own provisions, in consequence of nonpayment of rent, and also that said leases were void, both for want of mutuality and as against public policy, and also insisted that Alfred E. Brush, being neither administrator, executor, nor assignee of Edmund A. Brush, but acting as heir of the latter, showed no title to recover this rent. The circuit judge held that the covenants for perpetual renewals at option of the lessor were void, as against public policy, and that claimant was not entitled to recover any rent accruing from and after July 1, 1893, and entered judgment accordingly against the claimant.

      Fred A. Baker, for appellant.

      Alfred Bussell and John Atkinson, for appellees.

       Rehearing denied November 17, 1896.

   Grant, J.

(after stating .the facts). The material parts of the leases being the same, we will discuss the first lease only. The position of the plaintiff is that this is a lease for a term of years, with covenants for perpetual renewals, and is equivalent to a demise in fee, and therefore valid. The position of the defendants is:

1. That the lease has ceased and is terminated by the nonpayment of rents.
2. That, if it is not so determined, it is void for want of mutuality.
3. That, if it be construed as a lease for perpetual renewals, it is void as against public policy.
4. That it was not intended by the original parties to it to be a lease in perpetuity.

There are authorities which hold that such leases are against public policy. In Morrison v. Rossignol, 5 Cal. 64, the court held that: “A covenant for a lease to be renewed indefinitely at the option of the lessee is, in effect, the creation of a perpetuity. It puts it in the power of one party to renew forever, and is therefore against the policy of the law.” In principle, there is no difference between an endless succession of five-year estates, and an endless succession of life estates, which the law prohibits. This lease is not a grant in fee, reserving rent, as the Van Rensselaer leases in the State of New York have been held to be. Van Rensselaer v. Hays, 19 N. Y. 68 (75 Am. Dec. 278); Van Rensselaer v. Ball, 19 N. Y. 100. In the present case the lease, aside from the clause for renewal at option of lessor, is the usual one for a term of years. The landlord, exercising his option to terminate, limited his liability to pay for buildings and improvements to $10,000. The land is situated near the center of the business pait of a great and growing city. The lessor cannot improve it, and there is no inducement for the lessee to do so. If the lessee should build expensive buildings, it would furnish an inducement for the lessor to terminate the lease; and, if the improvements do not amount to that sum, yet another person may be willing to pay more rent, and make an agreement with the lessor to terminate the lease and oust the tenant. It must be conceded that such an arrangement prevents the free use, sale, and circulation of property which is in accord with the spirit of this country. It is clear that this is not an absolute lease for such length of time as, under the New York decisions, amounts to a transfer of the fee, and in no sense restricts or interferes with that use and sale of the land, and the interest of the lessor and lessee, in which the public are rightfully interested. It is, however, unnecessary to discuss this question further, or to determine the validity of a lease which in unequivocal language provides for perpetual renewals. We are of the opinion that this lease does not so provide. In one point the authorities are harmonious, viz., that the law does not favor perpetua, leases of the character claimed for this one, and the intention to create one must appear in clear and unequivocal language. It cannot be left to inference. Courts will, if possible, so construe the writing as to avoid a perpetuity by renewal. Muhlenbrinck v. Pooler, 40 Hun, 526; Bruce v. Bank, 79 N. Y. 154 (35 Am. Rep. 505); Rutgers v. Hunter, 6 Johns. Ch. 215; Piggot v. Mason, 1 Paige, 412; Carr v. Ellison, 20 Wend. 178; Syms v. Mayor, etc., of New York, 105 N. Y. 153, 50 N. Y. Super. Ct. 289.

We think it clearly appears “from the four corners of the instrument ” that the parties did not intend to provide for perpetual renewals. The writing bound only Mr. Brush, his administrators, executors, and assigns, and Mr. Beecher, his administrators, executors, and assigns. It bound the heirs of neither party. See Rawle, Cov. §§ 309, 310. The learned counsel for the plaintiff appears to recognize this, and admits that the heirs of Mr. Beecher are not personally bound, but that under 2 How. Stat. §§ 5937, 5940, the heirs of Mr. Beecher are liable only so long as they have assets in their hands which came from his estate. These sections, and other provisions of chapter 224, 2 How. Stat., refer to contingent claims, and such claims must first be proven against the estate. This necessarily involves keeping the estate open indefinitely,— a condition for which the statute does not provide. It is held in Quain’s Appeal, 22 Pa. St. 510, that a ground-rent covenant does not survive against the administrators, except as to the rents which accrued in the lifetime of the deceased. It is reasonable to hold that the word “ heirs” was left out of this lease for the reason that neither party desired to make it binding upon his heirs. It would be absurd to hold that either party understood that he was executing an instrument which would require his estate to be kept indefinitely in the hands of executors. The duty of administrators is to settle estates, and divide them among the heirs. They cannot carry on the business in which the deceased was engaged,' except at their peril; and, even where a will provides that executors may continue the business of their testator, they cannot be compelled to do so. Williams, Ex’rs, 1762, 1791.

The rent is reserved to the lessor, his administrators, executors, and assigns, and not to his heirs. It is also of some significance that the lease contains no provision for re-entry by the lessor in case of nonpayment of rent, which is usually found in leases, but only in case he shall elect to take the buildings and terminate the lease. The language is that upon failure to pay the rent the lease shall immediately cease and terminate, and be utterly void, anything to the contrary therein contained notwithstanding. In case of failure to pay rent, the lessee would lose his buildings, for they were a part of the realty. Kutter v. Smith, 2 Wall. 491. If Mr. Beecher had refused to appoint arbitrators to readjust the rent, or if the arbitrators had failed to agree, the lease contains no provision by which the old lease shall stand, or the former rate of rent continue. Mr. Beecher might lose his improvements in the event of his refusal to appoint arbitrators, and Mr.- Brush’s remedy at law for damages would be ample. Under the authorities above cited, Mr. Brush could not maintain a suit in equity to enforce the specific performance of his contract. We do not think that this contract should be construed to provide for perpetual renewals, or to extend beyond the lives of the parties to it. It was terminated by their death.

It follows that the judgment must be affirmed.

Montgomery, Hooker, and Moore, JJ., concurred. Long, C. J., did not sit.


author: Moore, J.

text:
    LORANGER v. DAVIDSON.
    1. Pleading — Common Counts — Evidence. .
    Testimony showing a breach of a contract of employment, and damages because thereof, is inadmissible under a declaration on the common counts in assumpsit forwork and labor performed for defendant at his request.
    2. Same — Appeal prom Justice’s Court — Amendments.
    Plaintiff, having so framed his declaration in justice’s court, will not he permitted to amend in the circuit on appeal so 'as to allege the breach of contract, since such an amendment sets up an entirely different cause of action from that stated in justice’s court.
    Error to Bay; Maxwell, J.
    Submitted April 23, 1896.
    Decided October 6, 1896.

      Assumpsit by Ered C. Loranger against Thomas W. Davidson and another for work and labor performed. From a judgment for plaintiff, defendants bring error.
    Reversed.

      Van Kleeck & Anneke, for appellants.

      U. B. Loranger, for appellee.
   Moore, J.

The plaintiff sued the defendants in justice’s court. He declared “verbally on the c&mmon counts in assumpsit, and especially for work and labor performed by plaintiff for defendants, at their request, during the months of January, February, March, and April, at $75 per month.” .He obtained a judgment for $150. Defendants appealed to the circuit court. It was the claim of the plaintiff that on October 11, 1894, he made an oral contract with defendants to become the manager of their store for one year from November 1, 1894, at a salary of $900 a year, payable monthly; that he worked nearly two months under the contract, when he was paid up and discharged without cause. He further claimed that he held himself in readiness to perform his contract, but was not allowed to do so. He sued to recover pay for the months of January, February, March, and April. It was the claim of the defendants that plaintiff was hired at $75 per month for the balance of 1894, and, if his work was satisfactory, he was to be continued in their employ; that his work was not satisfactory, and for that reason they did not retain him; and that he was paid in full for all that he did.

When plaintiff had put in some proof and given his version of the contract, objection was made to his putting in proof in relation to the months of January, February, March, and April, upon the ground that, if no work was done after the 1st of January, plaintiff should have counted on a breach of the contract, when this occurred:

“The Court: That is right, but I will permit him to amend.
“Mr. Tor anger: In the court below, this point was not raised, and has been waived. The whole thing was gone into there.
“The Court: You are entitled to amend, and you may amend.
“Mr. Anneke: Will your honor hear some authorities upon the amendment ?
“The Court: No; I don’t care to hear them. You may file your amendment during the day. (Exception taken.)
“Mr. Van Kleeck: Will your honor pursue the ordinary rule where an amendment like this is made, and let us have the option to go to trial now or have the case go over? We say to your honor that we are not ready to meet the issue that is proposed by this amendment. It is an entirely new and distinct issue.
“The Court: Proceed. It is refused. (Exception taken.)”

The amendment was not made in fact, but was treated by the court as made, and was afterwards put in form. Some testimony was given in the case over the objection of counsel, when this occurred:

“Mr. Van Kleeck: I would like to be heard. Neither of these parties ought to be put to the expense of going to the Supreme Court on this question of pleading.
The Court: I won’t hear any -more arguments on that subject.
“Mr. Van Kleeck: We desire when the amendment is made to interpose a different plea. We have a right to interpose a different plea, and get witnesses to cover the new issue made.
“ The Court: Very well.
“Mr. Van Kleeck: We ask that the case go over the term.
“ The Court: Proceed. (Exception taken.)”

The case did proceed against the objections of the defendants, and a verdict was rendered in favor of the plaintiff for $150. Defendants bring the case here.

The first group of assignments of error relates to the amendment of the declaration directed by the court. It is insisted that the amendment allowed made a different cause of action from that stated in justice’s court, and was unauthorized by the statute. In Gorman v. Newaygo Circuit Judge, 27 Mich. 138, it was held that a declaration upon the common counts in assumpsit, and one upon a special contract, are for distinct and different causes of action. The cause of action stated in the amended declaration was entirely different from that stated in justice’s court. The jurisdiction of the circuit court on appeal is appellate only. The appeal transfers to the circuit court the same cause that was before the justice, and an amendment cannot be allowed in the circuit that states a different cause of action from that stated in justice’s court. Evers v. Sager, 28 Mich. 50; Fowler v. Hyland, 48 Mich. 181; Cross v. Eaton, Id. 184; Hatzenbuhler v. Lewis, 51 Mich. 585. We think the assignments of error are well taken. We agree with the trial judge that the plaintiff should have counted upon a breach of the contract, and that the testimony tending to show a breach of the contract, and damages because thereof, is not admissible under the declaration as framed.

The judgment of the court below is reversed, and a new trial ordered.

Grant, Montgomery, and Hooker, JJ., concurred. Long, O. J., did not sit.


text:
    BLAKE v. LOBB’S ESTATE.
    Mining Lease — Failure of Ore — Liability of Lessee eor Rent.
    A lease of land “for the purpose of exploring for, mining, taking out, and removing therefrom the merchantable iron ore which is or which hereafter may be found on, in, or under said land,” at a specified annual rent, to be considered in the adjustment of royalties on ore removed, presupposes the existence of merchantable ore, and if, after reasonable efforts on the part of the lessee, ore is not found in minable quantities, the lease fails, and no rent can be collected. Qribben v. Atkinson, 64 Mich. 651, followed.
    Error to Marquette; Stone, J.
    Submitted April 29, 1896.
    Decided October 6, 1896.
    Richard Blake presented a claim in probate court against the estate of Edward Lobb, deceased, for rent. The claim was disallowed, and claimant appealed to the circuit court. Prom a judgment for defendant, claimant brings error.
    Affirmed.

      Ball & Ball, for appellant.

      Hayden & Young, for appellee.
   Montgomery, J.

“In consideration of the sum of one dollar to them paid by the parties of the second part, the receipt whereof is hereby acknowledged, and in further consideration of the covenants and conditions herein contained, 'to be kept and performed by the parties of the second part, do hereby let, lease, and demise to the parties of the second part, for the term of 20 years, the said tracts of land, containing 160 acres, which premises are leased to the said parties of the second part for the'purpose of exploring for, mining, taking out, and removing therefrom the merchantable iron ore which is or which hereafter may be found on, in, or under said land, together with the right to construct all buildings, make all excavations, openings, drains, ditches, railroads, wagon roads, and other improvements upon said premises which are or may become suitable or necessary for the mining and removing of iron ore from said premises.”

On the 1st of January, 1892, claimant was the owner of an interest in certain mining lands in the county of Marquette, and joined with his co-owners in making a lease to the deceased and others, by which the owners—

There was -also a provision that—

“The parties of the second part shall have the right at any time to terminate this agreement, in so far as it requires the parties of the second part to mine ore on said land, or to pay a royalty therefor, by giving 60 days’ written notice to the parties of the first part, either in person or by mail, and thereupon the foregoing lease and demise shall terminate, and all arrearages and sums which may be due under the same up to and including the date of its determination, as set forth in such notice, shall be paid upon settlement and adjustment thereof.”

The undertaking of the deceased was as follows:

“The parties of the second part, in consideration of the said demise, hereby covenant and agree to and with the parties of the first part, to pay to the parties of the first part or their assigns, in manner hereinafter designated, as rent for the lands hereby demised, the sum of $6,000 per annum, payable, for the first year, on the 1st day of January, 1893, and thereafter quarter-yearly on the days hereinafter specified for the payment of royalty, and also such additional sums as may accrue for royalty on ores removed, as hereinafter set forth (said royalty being treated as rent), to the several parties of the first part, or their assigns: Provided, that all the royalties paid on iron ore mined and removed from said premises during any year ending December 31st shall apply, so far as necessary, or so far as the same will go, to the satisfaction and payment of said rent for such year, and if, in any year, the royalty on iron ore so mined and removed by said second parties shall not amount to $6,000, the rent so paid by said second parties in excess of the amount of such royalty shall be applied towards the payment of any excess over $6,000 that may be payable on account of royalties in any subsequent year.”

The parties of the second part also undertook to “take out and remove as much iron ore as can be mined and removed profitably to said parties, paying therefor at the quarter dates aforesaid, and at the rates aforesaid, for each and every ton of ore so mined and removed.”

The lease in question was terminated by notice given August 2, 1893, and this action was brought to recover rent under the lease, accruing prior to said notice. The defendant offered testimony tending to show that no iron ore in minable quantities existed in the premises, and the circuit judge charged the jury that, if it was found that there was no iron ore there — no merchantable iron ore — ■ on the property in sufficient quantities to make it pay, and that the deceased used all reasonable efforts to ascertain that, and made the proper excavations to discover any iron ore, the plaintiff could not recover. The circuit judge relied on the case of Gribben v. Atkinson, 64 Mich. 651. It is contended by the plaintiff that that case is distinguishable from this, in that in that case the payments to be made were designated as “royalty,” while in the present case they are spoken of as “rent.” The circuit judge was of the opinion that this does not distinguish the cases, in determining the intent of the parties, and we think in this there was no error. In that case, as in this, the lease was made for the purpose of exploring for, mining, and taking out merchantable iron ore, and it was held that the lease, by its terms, presupposed the existence of ore, and that, upon its appearing that no such ore was to be found, the purpose of the lease failed, and the defendant should not be charged with -the consideration. In that case, as in this, there was a specific engagement to pay a specified sum at all events, and while, in that case, it was called “royalty” and in this case termed “rent,” the agreement was, in both cases, based upon the supposition that ore existed. We think this idea was no more clearly expressed in that lease than in this. The scheme of a mining lease implies that ore exists in minable quantities, and, if it does not, the scheme fails. East Jersey Iron Co. v. Wright, 32 N. J. Eq. 248. See, also, Muhlenberg v. Henning, 116 Pa. St. 138.

The judgment will be affirmed, with costs.

Grant, Hooker, and Moore, JJ., concurred. Long, C. J., did not sit.


text:
    PRINGLE v. WAGNOER.
    Land Contract — Foreclosure—Defenses—Sale for Taxes.
    A purchaser under a land contract cannot interpose as a defense in foreclosure proceedings that the land has been sold and deeded for taxes leyied subsequent to the execution of the contract, where, by the terms of the contract, it was his duty to pay such taxes.
    Appeal from Mecosta; Palmer, J.
    Submitted June 19, 1896.
    Decided October 6, 1896.
    Bill by Uriah S. Pringle against John Wagnoer to foreclose a land contract. Prom a decree for complainant, defendant appeals.
    Affirmed.

      George J. Cummins, for complainant.

      Frank Dumon, for defendant.
   Moore, J.

The complainant filed a bill to foreclose a land contract made in 1887 for the sale'of 40 acres of land. The payments had not been made according to the terms of the contract. The prayer was for a sale of the premises to satisfy the amount due on the contract, and, in case of a deficiency, for a personal decree. The defendant claimed, by way of'defense, that when he made the contract with complainant he was induced to do so by false and fraudulent representations as to the character of the land, and the quantity and quality of the timber, and that when he found out the fraud he rescinded the contract. He also claimed that the land had been sold for taxes for the years 1887, 1888, 1889, 1890, 1891, and 1892, and that these sales cut off all liens and incumbrances on the land, and extinguished all prior titles, and that for that reason the complainant could not maintain his bill. The circuit judge granted a decree as prayed for in complainant’s bill. The defendant appeals. •

The first inquiry to consider here is, has the defendant established fraud at the time the contract was made, and a rescission of the contract on his part when he learned he had been deceived? We do not' think he has established either of those propositions. The "testimony was very contradictory. The circuit judge had the witnesses before him. He is better able to determine the truth, from having heard and seen the witnesses, than we are from the record. There is nothing in the- record that leads us to the conclusion that the question of fact at issue was improperly determined by the trial judge. Sowles v. Raymer, ante, 189.

The other question to be considered is the effect of the sale of the lands for the taxes. The-taxes were levied subsequent to the making of the land contract. It was the duty of the defendant to pay these taxes. He failed to do so. He cannot now be heard, when he attempts to interpose the tax sales and deed as a defense in the proceeding.

The decree is affirmed, with costs.

The other Justices concurred.


text:
    CHAMBERLAIN v. LAKE SHORE & MICHIGAN SOUTHERN RAILWAY CO.
    Railroad Companies — Legal Fare — Ejection op Passenger.
    One who tenders the legal fare to the conductor of a passenger train, and is ejected because of his refusal to pay the customary fare, which is in excess of the amount legally demand-able, may recover the actual damages sustained by reason of his ejection, although he had knowledge of the custom of the company, and had frequently paid the higher rate of fare.
    Error to Monroe; Kinne, J.
    Submitted June 19, 1896.
    Decided October 6, 1896.
    Case by William Y. Chamberlain against the Lake Shore & Michigan Southern Railway Company for the wrongful ejection of plaintiff from one of defendant’strains. From a judgment for plaintiff, defendant brings error.
    Affirmed.

      G. E. Weaver (George G. Greene and O. G. Getzen-Danner, of counsel), for appellant.

      Willis Baldwin and Ira G. Humphrey, for appellee.
   Moore, J.

Plaintiff was returning home from Detroit. He took a train that ran over the Dundee Branch of defendant’s road, at Trenton, to go to Flat Rock, a distance of 6.3 miles. The defendant had for many years charged 25 cents fare between those places, and plaintiff had often paid that amount. Believing the company had no right to collect more than 3 cents a mile, plaintiff tendered the conductor 21 cents in payment of his fare. The conductor refused to accept the 21 cents, and demanded 25. This was not paid, and the conductor put the plaintiff off the train. The plaintiff claims it was a cold, rainy night; that he was obliged to walk home; that he caught cold, which resulted in rheumatism. This claim of the plaintiff was cohtroverted, and testimony was offered tending to show that it was a clear night, and that plaintiff’s physical condition was not different after he was put off the train from what it was before. The plaintiff sued the defendant, and recovered a judgment for $400. The defendant appeals.

Testimony was offered by the plaintiff as to the effect upon his health of the exposure to which he was subjected. His neighbors testified in relation to his physical condition both before and after the night in -question. This testimony was objected to. There are several assignments of error in relation to its admission and the admission of other testimony. We have examined them all, and do not think any of them well taken.

It is not contended in the brief of counsel that defendant had a right to charge more than three cents a mile. It is the claim of defendant that plaintiff should have paid the extra four cents, and, if he thought the company was not entitled to it, he should have sued the company to recover it back, and that when he failed to do this, and was put off the train, he could recover only nominal damages; citing Hall v. Railroad Co., 15 Fed. 57; Townsend v. Railroad Co., 56 N. Y. 295 (15 Am. Rep. 419); Chicago, etc., R. Co. v..Griffin, 68 Ill. 499; Toledo, etc., R. Co. v. Wright, 68 Ind. 586 (34 Am. Rep. 277); Pullman Palace Car Co. v. Reed, 75 Ill. 125 (20 Am. Rep. 232); Frederick v. Railroad Co., 37 Mich. 342 (26 Am. Rep. 531); Hufford v. Railway Co., 53 Mich. 118. An examination of these cases will disclose the fact that they do not sustain the position urged by counsel. They relate to cases where the passenger was seeking to travel without having a ticket indicating his right to passage, and without offering to pay his fare. The case at issue is entirely different from any of them. Here the defendant was exacting an illegal fare, — something it had no right to do. The plaintiff was seeking to have transportation as a passenger, and. was willing to pay the legal fare therefor. Upon the tender of the legal fare he had a right to be carried to his destination. It was the duty of the defendant, under the facts shown by the record, to carry the plaintiff to Mat Rock. Instead of performing its duty, it committed a trespass upon him. We think the case is within Zagelmeyer v. Railroad Co., 102 Mich. 214 (47 Am. St. Rep. 514), and cases cited therein.

Judgment is affirmed

The other Justices concurred.


author: Long, C. J.

text:
    HOFFMAN v. CITY OF PORT HURON.
    1. Evidence — Ancient Road — Location.
    The maps, plats, and deeds of land referring to a specified road, all traces of which have disappeared, are the best evidence to establish its location.
    3. Same.
    Where such evidence was available in an action to recover land described as “lying between the Lake road and the lake,” it was error to permit witnesses to give their opinions as to the location of the road, based upon their recollection of where they used to travel in passing along the shore,— especially where no road of any definite or uniform width had ever been cut out.
    Error to St. Clair; Eldredge, J., presiding.
    Submitted June 20, 1896.
    Decided October 6, 1896.
    Ejectment by Wesley L. Hoffman against the city of Port Huron. From a judgment for defendant, plaintiff brings error.
    Reversed.

      H. W. Stevens and A. B. Avery, for appellant.

      P. H. Phillips, City Attorney (Frank Whipple, Atkinson & Wolcott, and Chadwick & Mcllwain, of counsel), for appellee.
   Long, C. J.

This cause was in. this court at the January term of 1894. At the October term of that year an opinion was filed, and is found in 102 Mich. 418. On that trial in the circuit the defendant recovered, and the cause was reversed in this court, and a new trial awarded. The cause has been retried before a jury, and plaintiff again brings error. The facts are very fully set out in the former opinion, and need not be restated, except as to such facts as are necessarily involved in the questions now presented.

It appears that one John M. Hoffman, on February 6, 1877, made a deed to the city of Port Huron conveying “the south part of fractional section 26, town 7 north, of range 17 east, excepting three acres owned by Holland, two acres owned by Mrs. Hall, one-half acre owned by Mrs. Dorwood, and Fishery No. 1.” The land claimed by the plaintiff, and the title to which is in controversy here, is what is called “Fishery No. 1,” and is described as “beginning at the north line of the Lighthouse Reserve on the lake, extending northerly 120 rods north of the north line of the McNeil tract, so called, including the land lying between the Lake road and the lake.” The question in controversy on the present trial, as on the former, was as to the location of the Lake road. Defendant contended on both trials that, by the action of the waters of the lake, the lands had_been washed away up to the line, or westward of the line, of the Lake road, so that its land extended to the water’s edge, and that in consequence Fishery No. 1, as then described, had no existence, but was, and is now, wholly covered by the waters of the lake. The plaintiff contends that the Lake road, so called, lies westward of the water’s edge some 200 feet at the south end, and about 165 feet at the north end, and that all the land east of this road is Fishery No. 1. Many of the questions raised upon this record were fully disposed of in the former opinion. Most of the questions now raised relate to the admission of certain evidence, the requests to charge which were refused, and the charge as given.

We are satisfied that the case must be again reversed, and remanded for another trial.' In the former opinion it was said that—

“There is no proof that, at the time when Butler conveyed these parcels of land, a highway had been cut out, or graded, or worked, or its location definitely fixed by authoritative action; and, as respects use or travel, the testimony clearly tends to show that the use was not confined to any line within a strip of land from 10 to 30 rods in width. Testimony of that character is admissible only as a dernier ressort.”

It was further said:

“As between the record of a highway, — being a survey thereof by the proper authorities, or a dedication thereof to the public, — and such a use of the margin along the shore of the lake, which margin is from 10 to 30 rods in width, as is indicated by the testimony of the defendant’s witnesses, which use includes the use of the way described in the survey or defined in the plat, the former must prevail.”

Other portions of the opinion also point out the uncertainty of the testimony of defendant’s witnesses in fixing the line of the Lake road upon the ground, and the conclusion was then reached that reference should be had to the deeds of conveyance, the maps and plats, and surveys, as the most reliable data by which to fix the line of the Lake road.

On the present trial the court below permitted the defendant to examine witnesses as to their recollection of where the road was actually traveled in the early days, and again these witnesses say that there was no road cut out, having any definite or uniform width, and they each were permitted to give an opinion as to where the road was. This testimony was objected to by plaintiff’s counsel, but admitted, and we think erroneously, and that it was very prejudicial to the plaintiff’s case. Counsel asked the court to charge the jury upon that branch of the case as follows:

“In this case, at the point in controversy, all traces of the road upon the land are gone, and, if any road was actually ever cut out in front of fractional section 26 on the surveyed line of the road of 1837, it is impossible to prove it at this date, and it is also impossible for any person to point out with definite certainty the place where the line of the road ran; and, all traces of the road having disappeared, — provided any was ever located on the surveyed line, — the rule that must now govern is that the field notes, or, in other words, the maps, plats, and deeds, are the best evidence to establish the location of .the road at its intersection with the north line,of the McNeil tract, and in front of the Robert Holland premises; and the jury are instructed that if they find as a fact that a line run from a point 75 links west from the quarter-post of section 4, following the courses and distances given in the survey of 1837 down in front of the Dorwood half acre, and in front of the Holland three-acre piece, and intersecting the north line of the McNeil tract at a point 11 chains and 13 links from the center of Huron avenue, will give the defendant its,full complement of land, and will leave a strip of land on the outside for the fishery, the verdict should be for the plaintiff.”

This charge the court refused to give. This was error. There was evidence tending strongly to show that, in taking a measurement from Huron avenue eastward, the defendant had its full complement of land.

In the former opinion it was said that “the presumption is that the highway, as surveyed, was within the government meander lines.” In view of this holding, counsel for plaintiff asked the court to charge that “ it is undisputed that, if the road is run anywhere inside of the meander line, it will leave a strip of land belonging to the plaintiff east of such line of road; and, in order to defeat the plaintiff’s right to recover, it is necessary to run the center line of the road outside of the meander line, and at least 200 feet east of Holland’s fence.” This request was refused. It should have been given.

Some question is raised as to the sufficiency of the declaration. That question was not raised on the former trial. It was only after the second trial had commenced that it was raised. The objection is that it does not describe any land with sufficient certainty to entitle the plaintiff to recover. The objection comes very late in the case, but we shall not rest the decision upon that ground, as we think the description in the declaration sufficiently certain.

The only question in the case is whether it is shown by the original purveys, maps, plats, and deeds of conveyance that any land within the lines of Fishery No. 1, as described, is now in existence between the Lake road, as originally laid out, and the waters of the lake. The measurements from Huron avenue, giving defendant its full complement of land, leaving this strip 200 feet wide at the south end, and 166 feet wide at the north end, are very strong evidence of the fact that such lands as Fishery No. 1 are not covered by the waters of the lake. We are also of the opinion that the surveys, maps, plats, and deeds of conveyance show very conclusively that there is a strip of land to which the plaintiff is entitled.

The judgment below must be reversed, and a new trial granted.

The other J ustices concurred.


text:
    CHURCH v. CASE.
    Mortgages — Consideration—Parol Evidence.
    Parol evidence is admissible to show that a mortgage, purporting to have been given for the purchase price of land, was in fact made without consideration, for the purpose of satisfying the mortgagee’s relatives and of protecting the interests of the mortgagor, and that it was agreed that it should never be enforced.
    Appeal from Barry; Padgbam, J., presiding.
    Submitted June 20, 1896.
    Decided October 6, 1896.
    Bill by Adelbert Q. Church and wife against Abner Case to restrain the foreclosure of a' mortgage. From a decree dismissing the bill, complainants appeal.
    Reversed.

      Taggart, Knappen & Denison, for complainants.

      Philip T. Oolgrove, for defendant.
   Moore, J.

This is a bill in chancery, filed by complainants, husband and wife, in which it is averred that defendant, who is an uncle of Adelbert Q. Church, is seeking to foreclose .a mortgage on the farm where the complainants live. It is claimed in the bill that in 1887 the complainants were living in Illinois; that they were poor, and had a large family; that the defendant was a man of considerable property; that Adelbert Church had for many years been supporting his mother, who for part of the time was bedridden; that his mother was a sister of defendant; that the defendant had promised complainants to pay them generously for supporting the mother; that defendant came to complainants in Illinois, and, in fulfillment of his promise to pay them for what they had done for the mother, proposed that if they would move upon a farm Which defendant owned in Barry county, Mich., and would reside there, and continue to support the mother, he would convey the farm to Adelbert, and assist him to start in farming; that said offer was accepted, and complainants took possession of the farm; that in pursuance of said agreement, on May 19, 1887, defendant deeded the farm to Adelbert Q. Church, who, with his family, has remained in possession ever since.

The bill further alleges that after complainants had gone into possession of the farm, and at the time the deed was made, defendant requested that a mortgage be made to him for $6,000, to stand in form as a purchase-money mortgage; that it was to be simply a form, and to satisfy other members of the family, who would object if the farm was conveyed outright to complainants, and was to be used to protect the interest of the complainants, but that it was agreed that the mortgage should not take effect as a mortgage, nor should complainants ever be called upon to pay it, and that it should be canceled at or before defendant’s death; that complainants had never seen the farm until they came to live upon it, and that it was not worth more than $1,500 or $2,000, and that the use of it for several years would not be worth more than the taxes came to; that complainants, relying upon the representations of defendant, consented to make the mortgage, and have made large improvements on the farm; that defendant visited complainants twice a year, and encouraged them to make the improvements; that defendant never asked complainants to pay either principal or interest.

The bill further alleges that in 1891 defendant represented to them that because of the new tax law, taxing mortgages, a new mortgage should be made, to avoid taxation on the mortgage, and that the new mortgage should take the place of the old one, and should not be enforced; and that, relying upon that statement, a new mortgage was made for the amount of the old mortgage, with interest added. It is also alleged that, without any notice to complainants, defendant commenced proceedings to foreclose the last-named mortgage; that if sold, either by foreclosure or at private sale, the farm would not bring one-half the amount of the mortgage, and, if the foreclosure proceeded, complainants would not only lose their farm, but six years’ labor, with the expenses involved in moving from Illinois, and the cost of the support of the mother, and a debt would exist against Adelbert Q. Church for the deficiency. The bill prayed that defendant be enjoined from foreclosing the mortgage, that it might be declared void and canceled, and that the title to the farm in fee simple be decreed to be in Adelbert Q. Church.

The defendant, in his answer, denied the averments of fact-in the bill, and insisted that he sold the farm to Adelbert Q. Church, for $6,000, and that the mortgage represents the unpaid purchase price of the farm. The bill was dismissed in the court below, and complainants appeal.

We think the complainants have shown, by a very strong preponderance of testimony, the truth of the material averments made in the bill of complaint. It is made to appear that, as early as when Adelbert Q. Church was but 14 years old, his mother had a sunstroke, and became bedridden for several years; that, from that time until now, she never has been able to do very much to help herself, and that Adelbert has been a devoted son to her; that his uncle has assisted from time to time in caring for the mother; that he expressed his willingness to do so. The testimony that he promised to convey the farm as stated in the bill comes from a good many witnesses, and is confirmed by the fact that the consideration in the deed and first mortgage is stated at $6,000, when the testimony shows that the farm was not worth more than half of that amount, and by admissions made by defendant on the cross-examination, and also by the fact that, though the mortgage was past due, no demand had been made for either principal or interest; so that we have no difficulty in concluding that complainants ought to have the relief prayed for, unless there are legal difficulties in the way of granting such relief.

It is urged by counsel for defendant that the court cannot give the decree asked for by the complainants, because the parties'have seen fit to reduce their agreement to writing, by making the deed and mortgage, and that these papers must be deemed to express fully their understanding. It is urged that all the parol evidence in relation to the agreement of the parties was incompetent; that “evidence of contemporaneous understandings is inadmissible to vary a written contract,” — citing Adair v. Adair, 5 Mich. 204 (71 Am. Dec. 779); Martin v. Hamlin, 18 Mich. 354 (100 Am. Dec. 181); Cline v. Hubbard, 31 Mich. 237; Cook v. Brown, 62 Mich. 473 (4 Am. St. Rep. 870); Cohen v. Jackoboice, 101 Mich. 409; and other cases. We do not think any of these cases are necessarily conclusive against the claim of the complainants. In Atwood v. Gillett, 2 Doug. (Mich.) 218, the rule is stated to be that—

“Where parol evidence is offered to show that the written contract is void or not of binding force, it is admissible; but, if the object be to prove that it was intended to mean something different from what its language imports, it is inadmissible.”

In Bush v. Merriman, 87 Mich. 268, it is held that—

“When the question is, not what the terms of the written contract are, but whether the contract as written was entered into or whether it was obtained by fraud, or is founded in surprise, accident, or mistake, these subjects of inquiry are open to parol testimony, irrespective of what the writing contains.”

In the case of Cutler v. Steele, 93 Mich. 208, it was stated:

“The real inquiry upon the hearing was whether or not there was a valid consideration for the mortgage; and parol evidence was admissible to show the true character of the mortgage, and for what purpose and consideration it was given. This inquiry was proper to be made. 1 Jones, Mortg. § 379.”

See, also, Holland v. Hoyt, 14 Mich. 242.

It is not the claim here that the mortgage was not written just as the parties intended, but it is the claim that it never was to be enforced as a mortgage; that, in fact, its execution was a mere form, and that it was not to be enforced. The parol proof sustains that claim. The deed was made in pursuance of the agreement made in Illinois to make it if the complainants would come on and take possession of the farm. That contract was neither abandoned nor rescinded, but, on the contrary, was carried into effect. The complainants leaving their home in Illinois, and going upon the farm, as they agreed to do, and the defendant making the deed as he agreed to do, completed that transaction. If the complainants’ proof is to be believed, the consideration of the mortgage was not the purchase of the farm, but it was made without consideration, and for the purpose of satisfying the relatives of the defendant, and to protect the interests of the complainants. The case of Colt v. McConnell, 116 Ind. 249, is a case almost parallel to the case at issue. In that case it was held that parol testimony was competent to show the consideration of the mortgage; that it was proper to prove the details of the transaction and the attendant circumstances, and to give evidence of the conduct and circumstances of the parties. Ao case even more in point is the recent case of Baird v. Baird, 145 N. Y. 659. In that case there is a full and interesting discussion of the principles involved in this case. It will not be necessary to repeat the discussion here, further than to say that it was held that it was competent to show by parol, where a father had deeded to each of his two sons an undivided half of a farm .for $2,500, and taken back from each of them a mortgage of $1,500, that the mortgages were executed because the father feared the sons might not be able to take care of the property, but might lose it in speculation or otherwise; that the mortgages were taken for their protection, and not to secure any actual debt. In that case the mortgages, were held to be void. The cases mentioned ought, in our judgment, to control this case.

The decree dismissing the bill of complaint is reversed, and one should be entered decreeing the mortgage to be void, and the title of the farm described in the bill of complaint to be in the complainant Adelbert Q. Church. Complainants should have costs of both courts.

The other Justices concurred.


author: Per Curiam. Per Curiam.

text:
    BENTLEY v. WAYNE CIRCUIT JUDGE.
    1. Divorce — Desertion.
    Under 2 How. Stat. § 6228, providing that a divorce may be decreed when either party shall desert the other for a term of two years, the cause for divorce does not “arise” until the desertion has been completed by abandonment for the statutory period.
    2. Same — Nonresident Defendant — Service of Process.
    Therefore, under Act No. 202, Pub. Acts 1895, providing that no decree of divorce shall be granted unless the defendant be domiciled within the State, or shall have been domiciled therein at the time the cause for divorce “arose,” or shall have been personally served with process within this State, or with copy of the order of publication, or shall have voluntarily appeared, it is necessary, in order to confer jurisdiction upon the court to render a decree for divorce on the ground of desertion against a defendant who became a nonresident before the two years of abandonment were completed, that personal service-should be obtained.
    3. Same — Failure to Support.
    It is not essential to the jurisdiction in such case, however, that the defendant should be so served, where failure to support is alleged as a ground for divorce.

      Mandamus by Dora M. Bentley to compel George S. Hosmer, circuit judge of Wayne county, to proceed with the hearing of a divorce suit brought by the relator, and to render a decree therein.
    Submitted October 6, 1896.
    Denied October 20, 1896.
    Submitted on rehearing November 10, 1896.
    Writ granted December 24, 1896.

      Sheridan J. Colby, for relator.
   Per Curiam.

The relator filed her bill in chancery in the circuit court for the county of Wayne to obtain a divorce on the ground of desertion. ' Her husband was a nonresident of the State, and the usual order of publication was made, and published for the statutory time. An order pro confesso was entered, and proofs taken in open court. While testimony was being taken, it was disclosed that there had been no personal service upon the defendant, and therefore the court refused to proceed further, or to render any decree, holding that it had no jurisdiction, under Act No. 202, Pub. Acts 1895. This act provides that—

“No decree of divorce shall be granted in any case unless the defendant be domiciled within this State, or shall have been domiciled herein at the time the cause for divorce arose, or unless the defendant shall have been personally served with process in this State, or with copy of the order of publication in said cause, or has voluntarily appeared in such action or proceeding.”

Divorce proceedings are purely statutory, and the statute must be complied with in order to confer jurisdiction upon the court. Complainant had not brought herself within the statute. She had not shown that her husband was domiciled in this State at the time the cause for divorce arose. No cause arose until the desertion was completed by abandonment for two years. At that time he had become a nonresident. The defendant had not been personally served with the order of publication.

The writ will be denied.

on rehearing.

Per Curiam.

Upon the former hearing of this case our attention was not called to the fact that one of the grounds of divorce was failure to support. It therefore appears that the cause for divorce arose when the defendant was domiciled within the State, and therefore the case does not come within that provision of the statute requiring personal service of process, or of a copy of the order of publication.

The writ will therefore issue as prayed.


author: Per Curiam.

text:
    BENNETT v. HICKEY.
    1. Appeal — Nonpayment of Register Pees — Dismissal.
    The provision of 2 How. Stat. § 6740, in relation to chancery appeals, that, if the appellant shall neglect to pay the register fees for making the return for 30 days after the appeal has been perfected, he shall be deemed to have waived his appeal, is mandatory, and upon such failure the appeal will be dismissed, in the absence of a waiver by the appellee of his statutory right.
    2. Same — Waiver.
    The right of the appellee to insist upon the dismissal of the appeal is held to have been waived by a failure of his counsel to assert his intention of relying upon such right when he was told by counsel for appellant, in response to the suggestion that the return had not been made within the time prescribed by statute, that counsel intended to have the return made at once, and that the appellee should not be inconvenienced by the delay.
    Appeal from Wayne; Carpenter, J.
    Bill by William C. Bennett against Edward J. Hickey and others to rescind a land contract, and for other relief. There was a decree for defendants, and complainant appealed.
    On motion to dismiss.
    Submitted' October 6, 1896.
    Denied October 20, 1896.

      Keenct & Lightner, for the motion.

      Fraser & Gates, contra.

   Per Curiam.

The decree being duly entered in the above cause, the claim of appeal was filed July 30th, and the bond was filed July 6th, and approved by the circuit judge on August 6th. This motion to dismiss was made September 19th, upon the ground that the fees were not paid to the register within 30 days after the appeal was perfected; the same having been paid on September 8th.

Sections 6739, 6740, 2 How. Stat., contain the provisions of the law relative to appeals. The following provision relating to the payment of fees was ingrafted upon section 6740 by Act No. 62 of the Laws of 1871:

And if an appellant shall neglect to pay to such register the fee for making such return for 30 days after such appeal has been perfected, he shall be deemed to have waived his appeal, and the appellee may at once proceed to enforce his decree, the same as if no appeal had been taken.”

This section was involved in the case of Barnes v. Munro (decided at the October, 1892, term of this court). In that case the appeal was perfected in due season, but the fees were not paid within the time required, and execution issued, which counsel sought to have vacated, and return made. The motion was denied, the appeal being treated as waived. A similar provision, relating to probate appeals, was passed upon in the case of Merriman v. Jackson Circuit Judge, 95 Mich. 279, where it was held that jurisdiction was lost by reason of a failure to seasonably file the record. In that case the statute before us was discussed, together with the decisions relied upon to sustain the proposition that the provision was directory, and we then thought that this statute afforded no support to the claim that the statute involved in that case was not mandatory. The case of Barnes v. Munro was not mentioned, being unreported.

We think, however, that this motion should be denied upon the ground that the right to insist upon the waiver of appeal had in turn been waived by counsel for the appellees, for the reason that counsel did not assert his intention to rely upon the statutory waiver when informed by counsel for appellant that he intended to make the return at once, and that he should not be inconvenienced by the delay, when counsel for the appellees told him that the return had not been made within the time prescribed by statute.

The motion is denied.

      No opinion filed.


text:
    SWEGLES v. WAYNE CIRCUIT JUDGE.
    1. Justices of the Peace — Appeal—Discontinuance—Costs.
    Under 2 How. Stat. § 7021, providing that, if an appeal from justice’s court be dismissed or discontinued, the court shall enter judgment in favor of the appellee for costs, an ' order permitting the appellant to discontinue upon payment of part of the costs only is unauthorized.

    2. Same — Remedy.
    Where such order is entered, however, the appellee’s remedy is by motion to set it aside, and not by application for judgment for full costs.

      Mandamus by John Swegles to compel Joseph W. Donovan, circuit judge of Wayne county, to awaid full costs to relator in a suit appealed from justice’s court and discontinued.
    Submitted October 6, 1896.
    Denied October 20, 1896.

      A. Ward Copley, for relator.

      James H. Pound, for respondent.

       In Peterson v. Frey, 109 Mich. 689, it is held that the appellant has no right to a dismissal of the appeal as against the objection of the appellee.

   Per Curiam.

Relator obtained judgment against one Patrick Dailey, before a justice of the peace, for $5 damages, and $4.20 costs of suit. Defendant appealed to the circuit court, where, on a trial, plaintiff obtained judgment for $90 damages and costs. February 4, 1896, this judgment was set aside, on motion of defendant’s counsel, on payment of $5. February 5th the following order was entered:

“ In this cause it is ordered that the defendant be permitted to discontinue his appeal in this case upon the payment 'by him to the clerk of the court of the sum of $5, as costs, over the justice’s judgment.”

On the same day the defendant, by his counsel, entered an order on the common order book dismissing the appeal. February 11th relator made a motion before respondent for judgment for costs, under the provisions of section 7021, 2 How. Stát. This statute provides that, “If an appeal be dismissed or discontinued, the court shall enter judgment in favor of the appellee for costs.” The motion was denied, and relator now asks the aid of mandamus to compel the respondent to enter such judgment.

It is not set out by the return to the order to show cause that plaintiff acquiesced in this order of discontinuance upon the payment of the amount of costs fixed by the order, and we are therefore of the opinion that the order of dismissal of the appeal upon this condition so entered was unauthorized, and should be set aside. No application, however, has been made to the court to set aside such order, "but the application was for a judgment for full costs, and was denied. Presumably, the court, upon proper application, will set aside this order of dismissal of the appeal, and the writ must be denied. No costs will be allowed.


text:
    CITIZENS’ COMMERCIAL & SAVINGS BANK v. BAY CIRCUIT JUDGE.
    Receivers — Actions Against — Discretion of Court.
    The circuit judge has power to set aside his order granting leave to sue or garnish a receiver if he believes such order to have been improvidently issued, and his action will not be disturbed in the appellate court unless an abuse of discretion is made to appear.

      Mandamus by tbe Citizens’ Commercial & Savings Bank to compel Andrew C. Maxwell, circuit judge of Bay county, to proceed with the hearing of a suit in garnishment against the receiver of an insolvent corporation.
    Submitted October 6, 1896.
    Denied October 20, 1896.

      T. A. E. & J. C. Weadock, for relator.

      Simonson, G-illett & Courtright, for respondent.

       The cases respecting the garnishment of money due from, a receiver are reviewed in a note to Irwin v. McKechnie, (Minn.) 26 L. R. A. 218.

   Per Curiam.

The relator commenced an action of assumpsit against A. Mosher & Son, and recovered a judgment. A corporation known as the E. J. Vance Box Company was indebted to Mosher & Son. One Wilson H. Tousey had been appointed receiver of said corporation by the circuit court for the county of Bay, in chancery. The relator, soon after commencing suit against Mosher & Son, petitioned the-chancery court for leave to bring a suit in garnishment against the receiver, which was granted. The receiver filed a disclosure denying that he had any property in his hands belonging to said Mosher & Son, but disclosed that said corporation was indebted to said Mosher & Son in the sum of $5,172.-89, that other parties claimed an interest in said indebtedness, and asked that the parties interested in the controversy growing out of said credit should intervene. An order to that effect was made; issue was duly joined; and upon the trial the respondent, after the relator had rested its case, made an order setting aside the one granting leave to bring the suit, upon the ground that it had been improvidently issued. The respondent returns that it appeared from the testimony that when the writ was served, and as well at the hearing, it was impossible th determine whether the receiver would be able to pay all the creditors in full, or what per cent, he would be able to pay. The relator now asks for the writ of mandamus to compel the respondent to set aside the last-named order, and to proceed with the hearing of the cause.

It is settled that a receiver cannot be sued or garnished without leave of the court. Tremper v. Brooks, 40 Mich. 333. See, also, Beach, Rec. § 228 (Alderson’s Ed. § 242); High, Rec. § 151. It is also settled that a receiver is not a public officer, and that he may be garnished, with permission of the chancery court, for any balance remaining in his hands after the execution of the trust. Cohnen v. Sweenie, 105 Mich. 643. The grantipg of leave to bring such a suit rests in the sound discretion of the court. Appellate courts will not interfere except in cases of the abuse of that discretion. If these courts have the discretion to grant leave, they have also the power and discretion to set aside the order when, in their judgment, it has been improperly made. Receivers are not to be harassed with garnishee proceedings and other suits unless, upon the proper showing, justice and equity require it. There is no evidence of an abuse of discretion, and the writ will be denied.