text:
    JUNE TERM, 1914.

    POWELL v. E. H. STAFFORD MANUFACTURING CO.
    1. Master and Servant — Infants—Trial — Contributory Negligence.
    Plaintiff, a minor under the age of 17 years, who was employed in the factory of defendant, was directed to assist the operator at one of the trimming machines of the defendant, and, while working close to the knife, relying on the operator not starting the machinery, was injured. He claimed he was not given proper instructions, although the testimony on this issue was conflicting. He testified that he was not told what to'do except in a general manner and supposed the operator would not start the machine while he was so engaged. Held, that the question of contributory negligence could not be determined as a matter of law, and was correctly left to the jury.
    2. Same — Instructions—Charge.
    And the charge of the court instructing the jurors that if he put his hand under the knife without caution and without calling the attention of any one to the act, or without instructions from any person to do so, unless he thought it necessary in the performance of his work, he was negligent, did not set up an improper standard, and, considered with the remainder of the instructions which advised the jury correctly as to the care required of plaintiff, etc., was sufficiently favorable to the defendant.
    S. Same — Fraud—-Misrepresentation of Minor as to Age.
    Requests to charge based on alleged misrepresentations of plaintiff that he was more than 17 years of age, and requested instructions that the employer was entitled to rely on his statements, held, inapplicable and properly refused, upon testimony of defendant’s agent that he did not rely upon plaintiff’s representations.

      Error to Ionia; Davis, J.
    Submitted June 11, 1914.
    (Docket No. 61.)
    Decided October 3, 1914.
    Case by Joseph Powell, by next friend, against E. H. Stafford Manufacturing Company for personal injuries. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Ellis & Ellis, for appellant.

      R. A. Hawley, for appellee.

       Continued from Vol. 182.

   Ostrander, J.

Alleging in his declaration that the defendant, his employer, set him at work dangerous to life and limb, that he was within the protection of the statute (Act No. 285, Pub. Acts 1909, 2 How. Stat. [2d Ed.] § 4009 et seq.), and that he was, without fault on his part, injured in performing his work, plaintiff sued for and recovered a judgment for damages. A motion for a new trial was refused. Whether, considering his age,, the employment, and the instructions which were given him, plaintiff’s injuries were due to his own negligence was the principal issue at the trial and is the principal question presented by the record before us; it being contended that upon this point a peremptory instruction should have been given in defendant’s favor. That the instructions given were prejudicial, and that, in any event, a new trial ought to have been granted, are other contentions of appellant.

There seems to be no particular dispute about plaintiff’s age. That he was injured upon one of defendant’s machines at which he was assisting another and mature operator in the operation of trimming veneer is clear. It is a contention of defendant that the plaintiff’s duties, if performed according to the nature of the work to be done and the instructions which were given, placed him in no danger and made his injury impossible. As it was, instead of keeping a position at a distance from the cutting knife of the machine — a position which defendant says was assigned him by the operator and indicated by the very nature of the work — it occurred that plaintiffs wrist was cut by the knife when it was set in motion by the operator. If plaintiff was not instructed, but, being called upon to assist the operator, was left to himself to measure the assistance he ought properly to give, depending upon the operator not to set the knife in motion while he was in danger, he might or might not be considered negligent, depending upon the judgment a youth of his age and experience, called upon for the first time to perform the service, ought to have exercised. The testimony is conflicting. Inferences may be, and it is claimed by appellant ought to be, drawn from the nature of the injury inflicted. Such inferences are drawn, by counsel, in argument. I am impressed that the contention cannot be decided as matter of law, and that it was not error to submit it to a jury.

It is pointed out that in one portion of the charge the court said, in defining “negligence” and in applying the definition, that if plaintiff—

“Did not use the care and prudence that an ordinary man would under such circumstances, but put his hand through without caution and care, and without calling the attention of anybody to the matter, or without instructions from any person to put his hand under the knife, unless he thought it necessary in the performance of his work, then I charge you he would be guilty of negligence, and if he was guilty of negligence, he cannot recover in this case.”

It is argued that the theory of recovery suggested in the instruction is not the theory of the declaration, which alleges the performance of a duty in accordance with orders — that plaintiff was ordered to do that which he did do. It is further argued that an improper standard was set up when it was suggested that what plaintiff thought was his duty, or thought was necessary to be done in performing it, was substituted for what he was or ought to have been instructed to do, or what was obviously necessary to be done within his instructions and his experience. It seems to be clear from a reading of the entire charge that the court had im mind, when the phrase I have italicized was used, an element which is plainly in the case and has already been referred to. To order an inexperienced and youthful employee to assist another to do a particular thing, and to stop there, may be to leave to inexperienced judgment the details, the method, of rendering assistance. Plaintiff says in the case at bar, that he was ordered to assist the operator of the machine, but was not told, except in a general way, how to assist, what to do, or what not to do, that he supposed he was doing a proper thing when he was hurt, and that while he was doing it the operator would not set in motion a knife which, when his hand approached it, was not in motion and could not be put in motion except by the act of his fellow workman. It is obvious that, as the jury found the plaintiff was performing or was not performing his apparent duty, it would find the employment dangerous or otherwise. There is no variance. The case submitted is the case alleged in the declaration and the case made by the testimony. If the plaintiff ought to have known better, was reckless or careless, he should not ask defendant to repair the consequences of his fault. This the court, in substance, told the juryr The whole charge was favorable, rather than unfavorable, to appellant.

While several witnesses sworn for defendant contradicted plaintiff in regard to the instructions given him, there were circumstances proven by which the truthfulness of the testimony might be, in some degree, tested, which, made the issue particularly one to be decided by a jury. The case for defendant is not so strong that we may say the verdict should be set aside because against the weight of evidence.

Appellant preferred a number of requests to charge based upon a claimed misrepresentation of plaintiff with regard to his age when he sought and entered upon the employment. In some of them the ruling asked for is, in substance, that as plaintiff represented himself to be, so his employer had the right to believe him to be and to instruct him accordingly, and so the jury had the right to and should regard his conduct. Questions of more than ordinary interest are thus suggested and discussed by counsel for appellant, but they are not properly for discussion because defendant’s witness who hired plaintiff does not pretend that the plaintiff misrepresented his age, nor claim to have taken any precautions or to have entered upon any investigation of the matter. He thought, he says, from plaintiff’s appearance, that he was “anywhere from 17 to 19 years. Somewheres along in there.” True, plaintiff testified that he told this witness that he was 17 years of age when, in fact, he was 16 years and 2 months old. But defendant’s agent did not, according to his testimony, rely upon what. plaintiff told him, but did rely upon his own judgment. Upon this point the case at bar and Syneszewski v. Schmidt, 153 Mich. 438, 444, 445 (116 N. W. 1107), cannot be distinguished. What was there said is applicable here.

I do not find reversible error made out, and think therefore the judgment should be affirmed.

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


source: Caselaw Access Project

author: Stone, J.

license: Public Domain

text:
    MICHIGAN CENTRAL RAILROAD CO. v. MICHIGAN RAILROAD COMMISSION.
    1. Constitutional Law — Interstate Commerce — Railroads — Carriers — Freight.
    In-the exercise of the exclusive power vested in the Federal congress to regulate commerce with foreign nations and among the several States, that body has completely and • thoroughly considered and legislated upon the subject of interstate commerce, so as to obtain the exclusive authority to pass legislation with reference thereto.
    2. Same — Demurrage.
    Terminal and storage charges and the rules and regulations relating thereto, as mentioned in sections one and six of the Federal statute of June 29, 1906, 34 U. S. Stat. 584, include demurrage.

    3. Same — Interstate Commerce.
    Shipments for interstate commerce become impressed with the character of such commerce from first receipt until final delivery to the consignee.
    4. Same — Powers oe the States.
    In consequence of the action of congress in legislating upon the subject of terminal charges and of the rules of the Interstate Commerce Commission promulgated in 1909 and 1912, relating to demurrage, and tentatively indorsing and adopting the regulations and rates of the American Railway Association, the. authority of the States to enact laws concerning such matters as are included by the Federal act has ceased, and Federal jurisdiction is exclusive.
    5. Same.
    Having adopted, whether tentatively or permanently, the revised rules of the American Railway Association affecting demurrage and other terminal charges, the Interstate Commerce Commission has assumed to act under the Federal statute and the subject has been removed from the jurisdiction of the States, so that Act No. 173, Pub. Acts 1911, in so far as it purports to regulate demurrage rates and charges, invades the exclusive power of congress and is unconstitutional.
    6. Same — Intrastate Commerce — Definition—Uniform Rules.
    Any car service on a car which has moved or is about to move in intrastate commerce is intrastate and is within State authority, and in so far as the rules adopted by the Michigan Railroad Commission, regulating demurrage charges, affect traffic of this nature, they are valid, and are not unreasonable because they differ in some particulars from the uniform rules indorsed by the Interstate Commerce Commission.
    7. Same — Burden of Proof — Equity—Michigan Railroad Commission.

      Held, also, that the regulations of the defendant as to intrastate traffic do not burden interstate commerce so as to invalidate them and that complainant railroad companies had failed to meet the burden of proof resting on them by statute to establish the unlawfulness or unreasonableness of the orders.
    Appeal from Wayne; Hally, J.
    Submitted June 15, 1914.
    (Docket No. 11.)
    Decided October 3, 1914.
    Bill by the Michigan Central Railroad Company and others against the Michigan Railroad Commission to enjoin the enforcement of certain demurrage rules adopted by defendant. From a decree for complainants, defendant appeals.
    Modified and affirmed.

      Beaumont, Smith & Harris (Grant Fellows, Attorney General, of counsel), for appellant.

      Taylor, Delbridge & Behr, for appellees.

       On the power of the State as to demurrage charges by carrier on interstate shipments, see note in 30 L. R. A. (N. S.) 137.

   Stone, J.

This cause deals with the power of the defendant to promulgate rules covering car service and demurrage, applicable to shipments of freight loaded or unloaded, in Michigan, and the validity of the rules promulgated by the defendant on July 5, 1912. The history of the controversy is somewhat lengthy and involved.

As early as January 1, 1909, the railroads of the lower peninsula of the State promulgated and placed in effect a set of demurrage rules applicable to both State and interstate business in Michigan. Those rules were contained in tariffs regularly filed by the railroads, with both the defendant and the Interstate Commerce Commission.

During the year 1909 the National Association of Railroad Commissioners, composed of the railroad commissioners of the several States, and the Interstate Commerce Commission, gave consideration to the formulation of a code of car service and demurrage rules. This code was finally adopted by that association, and Was tentatively approved by the Interstate Commerce Commission, on December 18, 1909. The Michigan railroads decided to adopt these rules, and announced them to be effective May 1, 1910, and published their tariffs and filed them as required by law. In the meantime the defendant had under consideration, on a complaint pending before it, the formulation of a set of demurrage rules, and on February 3, 1910, it promulgated, by an order, such a set of rules to be effective March 1, 1910, accompanied by an opinion as to its power, and as to the reasonableness of its rules.

Upon March 1, 1910, a bill of complaint was filed in the circuit court for the county of Wayne, in chancery, by a number of railroad companies, which are likewise parties complainant in the instant case, praying that the defendant be restrained from enforcing the rules it had promulgated to be effective on that date. The bill charged in substance that the defendant, under the act by which it was. created, had no authority to make such rules; that the rules themselves were a burden upon interstate commerce; and that, by the express terms of the act, the defendant commission was limited in its power over transportation to the transportation of property between points within the State of Michigan. The defendant demurred to this bill of complaint. Upon a hearing in the circuit court a decree was entered sustaining the demurrer. Upon an appeal to this court by complainants, the decree of the lower court was reversed, and it was held in substance that the statute (Act No. 300, Pub. Acts 1909) limited the authority of the defendant to the regulation of transportation within the State of Michigan. Ann Arbor R. Co. v. Railroad Commission, 163 Mich. 49 (127 N. W. 746). Justice Blair, writing the opinion, said:

act creating the defendant and defining its powers, its
“It is apparent, therefore, that, by the terms of the authority to promulgate demurrage rules is limited to cases where the property has been or is to be transported ‘between points within this. State.’ It becomes unnecessary, therefore, to consider the power of the legislature to grant the authority claimed for the defendant or the other interesting questions discussed in the briefs of counsel, since the limitations of the act creating it negative any authority on the part of defendant to establish and enforce demurrage rules where the transportation is interstate.”

This opinion was handed down September 28, 1910. As the law then stood, it is therefore res ad judicata that the defendant had no jurisdiction over demurrage upon interstate shipments.

However, by Act No. 173, Public Acts of 1911 (3 How. Stat. [2d Ed.] §§ 6526, 6531), sections 3 and 8 of the act under which the defendant was organized were amended, so that they read as follows; the amendments appearing in italics:

“SEC. 3 (d). The provisions of this act shall apply to the transportation of passengers and property between points within this State, and to the receiving, switching, delivering, storing and handling of such property, -and to all charges connected therewith, including icing and mileage charges: Provided, however, that this provision shall not be construed as a limitation on the authority of the commission created by this act to prescribe car service and demurrage rules applicable to all traffic beginning or ending within this State.”
“Sec. 8. Every railroad shall, when within its power so to do, and upon reasonable notice, furnish suitable cars to any and all persons who may apply therefor, for the transportation of any and all kinds of freight in car load lots. * * * The commission shall have power to make and enforce, and shall make and enforce reasonable regulations for the furnishing and distribution of freight cars to shippers and switching the same, and for the loading and unloading thereof, and for the weighing of the cars and the freight offered for shipment over any line of railroad and shall fix a reasonable per diem demurrage to be paid_for the detention of cars by shipper or consignee (which said car service and demurrage rules and regulations shall be applicable to all traffic whether the same begin or end within the State of Michigan), and for the failure or delay of the railroad in the furnishing of such cars, and for the failure of the railroad to move the cars the number of miles per day as ordered by the commission.”

At the time of the above legislation, the present case was pending in the circuit court, but the bill of complaint was so framed as to raise only the question of the power of the defendant to enforce its demur-rage rules as to intrastate commerce.

An order had been entered on handing down our decision in the Ann Arbor Railroad Company Case, modifying the previous injunction, and permitting the railroad companies to make effective, on interstate business, the rules known as the uniform rules, and permitting the defendant to enforce upon State business the rules it had promulgated.

In view of the State legislation above referred to, the complainants, on September 2, 1911, filed an amended bill of complaint, setting forth the foregoing proceedings, and charging that the defendant claimed that it had the power to enforce its rules upon both State and interstate business in Michigan; that the freight cars of complainants could not be detained without unlawfully burdening interstate commerce; that defendant had no authority to promulgate its rules as to interstate commerce; that the power of the defendant was limited to State traffic; that no other power had ever been conferred on it by the State legislature; that the legislature had no authority to confer any power upon the defendant to affect demurrage; that the said act of the legislature of 1911, purporting to extend the power of the defendant, in that respect, was beyond the power of the legislature; that interstate commerce began with the loading of the property intended for interstate shipment, and continued until it was unloaded; that the Interstate Commerce Commission had complete jurisdiction over interstate commerce; that the"rules promulgated by the defendant would constitute a burden upon interstate commerce; that the rules so promulgated gave an advantage to shippers in intrastate commerce; that the allowance of extra time would afford such an advantage, would increase the expense to the railroads, cause trouble and annoyance in the handling of cars, greatly increase the expense of the carriers under the interchange agreement, and delay the use of cars;' and that, in such respects as the Michigan rules differ from the uniform rules, they would constitute a burden upon interstate commercé. The defendant answered the amended bill, admitting that it claimed authority to promulgate rules, but denying that the rules it had promulgated would materially extend the time within which cars would be detained. It admitted the amendment of the statute of 1911, and declared that the legislature had power to confer the authority therein attempted to be conferred on the defendant; that under this amendment the defendant had authority to promulgate rules applicable to both State and interstate commerce, and denied that its rules were a burden upon interstate commerce, or would cause any inequality or discrimination.

On October 5, 1911, the defendant reissued its order directing that its demurrage rules should become effectual on both State and interstate business, and on January 31, 1912, the complainants again amended their bill of complaint, calling attention to the making of this order, and praying for an injunction, and on February 7, 1912, an injunction was issued restraining the defendant from making effectual its said order of October 5, 1912.

Under an order of reference theretofore entered, the parties proceeded to take proofs, and, these having been completed, the court- entered añ order, on June 22, 1912, referring to the defendant the testimony and proofs, in accordance with the provisions of the act of 1909. On July 5, 1912, the defendant entered an order which recited the proceedings that had been taken before it, and the fact that the proofs had been certified to it, and had been examined; that the demurrage rules established by the railroad companies in Michigan were unreasonable and unjustly discriminatory, and the defendant promulgated a new set of rules, which appear in the record and are known as the rules of July 5, 1912. Later, and on August 21, 1912, on application of complainants, the court issued an injunction against the defendant, forbidding it to enforce its new rules of July 5th. While this litigation had been progressing, the so-called uniform rules, or national car demurrage rules, had been the subject of frequent discussion by the National Association of Railroad Commissioners, by the American Railroad Association, and by the Interstate Commerce Commission. The American Railroad Association had issued certain explanations of these rules and had adopted the rules themselves and had modified them from time to time. Finally, on June 3, 1912, the Interstate Commerce Commission issued its bulletin to the effect that it had tentatively indorsed such revised rules. . That bulletin reads as follows:

“INTERSTATE COMMERCE COMMISSION.
“Washington, D. C., June 3, 1912.
“Revised National Car Demurrage Rules.
“The American Railway Association on May 15, 1912, adopted a revised set of national car demurrage rules, that being the designation used by the American Railway Association for the uniform demurrage code tentatively’approved by the commission on December 18, 1909, and also a revised set of the explanations to the national car demurrage rules tentatively approved on April 11, 1911.
“The Interstate Commerce Commission, recognizing the great benefits to be derived from uniformity in car service rules, is desirous of lending its influence to the movement. The commission therefore tentatively indorses' the revised rules and explanations thereto adopted by the American Railway Association and recommends that they be made effective on interstate transportation throughout the country. This action is of course subject to the right and duty of the commission to inquire into the legality and reasonableness of any rule or rules which may be made the subject of complaint.
“By the Commission:
[Seal.] “John H. Marble, Secretary.”

The above-mentioned rules and their explanation, and the defendant’s revised rules promulgated July 5, 1912, are published in the record in parallel columns. The testimony having been returned to the court, by the defendant with its revised rules, the case came on for hearing, and the learned circuit judge found that the bill of complaint was well founded, and. that its prayer should be granted. A decree was entered reciting that it appeared to the court “that the State of Michigan and the defendant are without any power, jurisdiction, or authority to promulgate, establish, or enforce demurrage rules as to the transportation of property in commerce with foreign nations and among the several States, and the movement and use of cars,, vehicles, and other instrumentalities therefor, referred to in said bill of complaint as interstate commerce, or to establish demurrage rules applicable to all traffic beginning or ending within the State of Michigan, and it further satisfactorily appearing that it is impossible to have two sets of demurrage rules in existence within the State of Michigan, one affecting interstate traffic as aforesaid, and the other affecting transportation for hire of property in commerce wholly between points within the State of Michigan, referred to in said bill of complaint as intrastate commerce, and materially differing from each other, without the latter becoming a material burden upon and regulation of interstate commerce, and it satisfactorily appearing to the court that the rules promulgated and proposed to be enforced by said defendant, as set forth in said amended bill of complaint, would, if enforced, constitute a material burden upon and regulation of interstate commerce,” etc., the defendant was perpetually restrained from promulgating,, enforcing, or attempting to establish or enforce its said demurrage rules. The defendant has appealed.

By reference to the two sets of rules, the uniform rules, as finally revised, and the Michigan Railroad Commission rules, as revised on July 5, 1912, it may be said that they differ only as. follows: Three days for unloading coal allowed by the Michigan rules, as compared with two days allowed by the uniform rules. Three days- allowed for unloading lumber (except cargo and lightered lumber) allowed by the Michigan rules, as against two days allowed by the uniform rules. Three days for the loading or unloading of interior finish allowed by the Michigan rules, as against two days allowed by the uniform rules. Three days for loading cars with furniture loaded by several consignors allowed by the Michigan rules, as against two days by the uniform rules. Five days’ free time allowed by the Michigan rules for unloading cargo and lightered lumber as against two days allowed by the uniform rules. Five days allowed by the Michigan rules for loading, weighing, and billing coal at the mines, as against two days allowed by the uniform rules. Five days’ free time allowed by the Michigan rules for unloading coal to be used for fueling transient vessels, as against two days allowed by the uniform rules. One day to fit up cars with lining for the loading of potatoes allowed by the Michigan rules, as against no allowance for this service by the uniform rules. The allowance for bunching and weather interference, to shippers operating under the average time agreement, as provided in the Michigan rules, as against the elimination of such an allowance as provided by the uniform rules.

These, as we understand it, are the particular provisions, as to which complainants contend that the Michigan rules are more liberal to the shipper than the uniform rules. In other words, they insist that the shippers would receive more time, and would that much longer detain cars, if they were operating under the Michigan rules, than if they were operating under the uniform rules. As we understand complainants’ position it is that:

(1) The defendant has no power or authority to enforce demurrage rules as to shipments in interstate commerce.

(2) The defendant has no power or authority to promulgate and enforce demurrage rules applicable to intrastate commerce only, which materially differ from the uniform code, or which are unreasonable in themselves, for the reason that such rules constitute a regulation of, and burden upon, interstate commerce.

Answering the foregoing propositions, we understand the claim of defendant to be:

(1) Demurrage and car service rules concern intrastate service or traffic in all instances, whether the car is to move, or has moved, from point to point within the State, or is to move, or has moved, beyond the borders of the State; and the State, therefore, can regulate this traffic, unless it be limited by the exertion of the constitutional power of congress with respect to interstate commerce and its instruments.

(2) If it should be determined that demurrage rules do not in all instances concern intrastate traffic, nevertheless the State in the absence of Federal legislation and regulation, can make such rules and regulate such traffic, so long as its. regulation does not directly burden interstate traffic.

1. Has the Michigan Railroad Commission power or authority to make and enforce demurrage rules as to shipments in interstate commerce? It may be said that Federal jurisdiction as to interstate commerce is exclusive. By the Federal Constitution, congress is given express power “to regulate commerce with foreign nations and among the several States.” The nature and extent of the power conferred by this provision have been under consideration in a vast number of cases in the United States Supreme Court. A citation of the cases would cover many pages of this opinion. Many of them are referred to in the late case of Simpson v. Shepard, 230 U. S. 352 (33 Sup. Ct. 729, 48 L. R. A. [N. S] 1151. A reading of the several acts of congress upon the subject shows that that body, in the exercise of the broad and exclusive power conferred by the Constitution, has given the subject of interstate commerce most careful consideration, and its legislation upon the subject is very complete and thorough.

Has congress acted upon the identical question we are considering? On June 29, 1906, the interstate commerce commission act was amended in several particulars. In that part of section 1 which defines the term “transportation,” it was made to read as follows:

“The term ‘transportation’ shall include ears and other vehicles and all instrumentalities and facilities of shipment or carriage, irrespective of ownership or of any contract, express or implied, for the use thereof and all services in connection with the receipt, delivery, elevation, and transfer in transit, ventilation, refrigerating or icing, storage, and handling of property, transported; and it shall be the duty of every carrier subject to the provisions of this act to provide and furnish such transportation upon reasonable request therefor, and to establish through routes, and just and reasonable rates applicable thereto.”

By the same act (section 6), which provides for the filing and publishing of rates and schedules, that part of the paragraph relating to this question was made to read as follows:

“The schedules printed as aforesaid by any such common carrier shall plainly state the places between which property and passengers will be carried, and shall contain the classification of freight in force, and shall also state separately all terminal charges, storage charges, icing charges, and all other' charges which the commission may require, all privileges or facilities granted or allowed and any rules or regulations which in any wise change, affect, or determine any part or the aggregate of such aforesaid rates, fares, and charges, or the value of the service rendered to the passenger, shipper, or consignee.”

Here we have an express recognition of the fact that terminal and storage charges, and rules and regulations relating thereto, have a direct effect upon rates and charges. That demurrage is a terminal charge is, we think, beyond question. The act provides heavy penalties and liabilities for its violation. The administration of the law is expressly conferred upon the Interstate Commerce Commission.

A comparison of the language of the act, of congress with that of the Michigan Act No. 300 shows that the former was intended to control and cover every incident of interstate commerce, including receipt, delivery, elevation, transfer in transit, ventilation, refrigeration, icing, storage, and handling of property transported, all terminal charges, storage charges, and rules relating thereto, just as the Michigan act was intended to cover every incident of intrastate commerce, including “all services in connection with the receipt, delivery, elevation, switching and transfer in transit, ventilating, refrigeration or icing, storage and handling of * * * property transported between points within this State.”

We think that shipments for interstate commerce become impressed with the character of such commerce from the first receipt thereof, and this character continues until the final delivery thereof to the consignee. Such is the plain intent of the language of the Federal legislation, and the similarity of the language of the two acts is evidence that the Michigan legislature of 1909 had in mind the Federal legislation above referred to. It cannot be presumed that the legislature intended or attempted to invade the field covered by the Federal legislation, and thus render its own action invalid. The learned circuit judge quoted the following language found in the case of Chicago, etc., R. Co. v. Elevator Co., 226 U. S. 426 (33 Sup. Ct. 174, 46 L. R. A. [N. S.] 203):

“As legislation concerning the delivery of cars for the carriage of interstate traffic was clearly a matter of interstate commerce regulation, even if such subject was embraced within that class of powers concerning which the State had a right to exert its authority in the absence of legislation by congress, it must follow in consequence of the action of congress, to which we have referred, that the power of the State over the subject-matter ceased to exist from the moment that congress exerted its paramount and all embracing authority over the subject.”

We think that the above language is applicable to the question we are considering. Has the Interstate Commerce Commission acted? On March 16, 1908, the commission decided that demurrage rules and charges applicable to interstate shipments are governed by the act to regulate commerce, and therefore are within its jurisdiction, and not within the jurisdiction of State authorities. On May 12, 1908, the commission adopted the following rules with relation to demurrage on interstate shipments:

“Demurrage on Interstate Shipments. The act requires that carriers shall publish, post and file ‘all terminal charges * * * which in any wise change, affect, or determine * * * the value of the service rendered to the passenger, shipper, or consignee,' and all such charges become a part of the ‘rates, fares, and charges,' which the carriers are required to demand, collect and retain. Such terminal charges include demurrage charges.”

In the case of Wilson Produce Co. v. Railroad Co., 14 I. C. C. Rep. 170, decided June 24, 1908, this exact question was before the Interstate Commerce Commission, and it held that:

“The duty of regulating terminal charges, when related to traffic between the States, has been lodged with the Interstate Commerce Commission. A State statute fixing terminal charges is not controlling with respect to interstate transportation.”

This case involved demurrage charges which were held to be terminal charges, within the meaning of the interstate commerce act. Many cases are cited, and it was held that it was unnecessary to decide that the Federal authority over this subject was exclusive, inasmuch as congress had taken definite action, and removed the subject altogether from the field of State regulation. See, also, Lehigh Valley R. Co. v. United States, 188 Fed. 879 (110 C. C. A. 513); St. Louis, etc., R. Co. v. Edwards, 227 U. S. 265 (33 Sup. Ct. 262).

We have not referred to the action of the Interstate Commerce Commission to show necessarily that its opinion was conclusive, but to show that it has assumed to act under the law of congress. It is said by counsel for defendant that it has not adopted the revised rules of the American Railway Association, but has only tentatively indorsed them, as shown by the bulletin above quoted. To indorse' is to sanction, ratify, or approve. The difference between adoption and indorsement is not very important. But it is said that it has only tentatively indorsed the national rules. It is true that the commission has only approved of these rules by way of trial. That is probably all it would do in the adoption of any rules. They would be subject to the right of change or amendment.

We think that the pertinent question is: Has the commission so acted under the law of congress that it can be said that the subject is removed from State regulation? Such question must be answered in the affirmative. We adopt the language of the trial judge:

“When congress placed the instrumentalities and the cars and the terminal charges and the storage charges into the hands of the Interstate Commerce Commission, those who, as to interstate traffic, desired to complain must apply to that tribunal for an adjustment of their grievances. The Michigan law, in so far as it attempts to give jurisdiction to a different tribunal, has invaded the domain of congress, and its enactment is of no force.”

We are forced to the conclusion, therefore, that the amendments of 1911 are without force or effect in so far as interstate commerce is concerned. By the Federal Constitution the subject of interstate commerce is within the exclusive jurisdiction of congress and congress has, by its legislation, taken possession of the entire subject. Therefore it is obvious that “demurrage rules applicable to all traffic beginning or ending within this State” can only apply to traffic beginning and ending within this State. Upon this branch of the case we agree with the circuit judge.

2. This brings us to the second proposition of complainants. We are of the opinion that any car service on a car which has moved or is about to move in intrastate commerce is intrastate, and therefore within State authority. In so far as the rules promulgated by the defendant apply to cars that are moving from point to point within this State, they are valid. The 'mere fact that those rules differ from the uniform rules in a few instances does not render them invalid, when applied to intrastate traffic. We have read this record carefully, and are unable to say that the Michigan rules, when applied to Michigan traffic, are unreasonable in themselves, or that they constitute a regulation of, or a burden upon, interstate commerce. It should be borne in mind that by section 26 of the Michigan act of 1909 it is provided that:

“In all actions under this section the burden of proof shall be upon the complainant to show' by clear and satisfactory evidence that the order of the commission complained of is unlawful or unreasonable, as the case may be.” Michigan Central R. Co. v. Railroad Commission, 160 Mich. 355 (125 N. W. 549).

We do not think that the complainants have sustained the burden of proof placed upon them by this statute. Much more might be said upon this branch of the case, but, as this opinion is already too long, we refrain from stating our reasons at length, for the conclusion reached.

Our attention has been called to the opinion of the Supreme Court of the United States in the Shreveport Case, filed June 8, 1914. We do not think that case controlling here, for the reason that in that case the Interstate Commerce Commission had acted, and had found that the State action was unreasonable. We do not find such action here unreasonable, when applied to State traffic.

The decree of the circuit court will be modified in accordance with the views here expressed, and the injunction will be so modified that the defendant will be permitted to enforce its rules as to intrastate traffic only. No costs are awarded to either party.

McAlvay, C. J., and Ostrander, Moore, and Steere, JJ., concurred. Brooke, Kuhn, and Bird, JJ., did not sit.


text:
    FACE v. HALL.
    1. Receivers — Powers—Carrying on Business.
    Unless the receiver is specially authorized by the court to carry on and conduct a business, he has no authority so to do from an order of the court appointing him to take and preserve property. Hence, a receiver who took charge of and attempted to carry on a grocery business, selling perishable and other portions of the stock, exceeded his authority, which should be measured and limited by the terms of the order of appointment.

      2. Same — Equity—Decree.
    The usual practice is to require orders of the court of chancery to be in writing. Oral advice or directions of the judge are not a protection to the receiver in exceeding his ordinary authority.
    3. Same — Advice of Court.
    A receiver of a grocery stock who took charge of and conducted the business without being properly authorized so to do; was not entitled to justify his action by a showing that he consulted the judge who entered the order of appointment and was directed to proceed to operate the store and business.
    4. Appeal and Error — Law of Case — Stare Decisis.
    Having appealed from a decree appointing a receiver, defendants were bound by a decision affirming the order of the lower court and could not object to such appointment on final settlement of the account of the receiver and upon a second appeal.
    5. Receivers — Exceeding Power — Sale of Stock.
    Where the receiver conducted the business of an insolvent grocery, having been appointed at the instance of his wife, as complainant, to hold and preserve the property in litigation, and where an order of the court was procured directing such receiver to sell and dispose of the stock and if the bids did not exceed a stated amount to take over and apply the stock on his charges as receiver for managing the business, and where these orders were carried out and the sale made to the receiver for his compensation, it appearing to be impracticable after the lapse of a considerable time during which he disposed of a large part of the stock, to‘set aside the sale to himself, a decree requiring him to account for the value of the stock, less his reasonable fees for preserving the! assets, is entered and such receiver directed and ordered to pay the difference to the appellants.
    Appeal from Ingham; Collingwood, J.
    Submitted June 16, 1914.
    (Docket No. 79.)
    Decided October 3, 1914.
    Bill by Willard H. Face against Eugene H. Hall and others for an order canceling and setting aside an exchange of property. Blanche R. Mott, one of the defendants, filed an answer in the nature of a cross-bill and secured an order for a receiver. From a decree allowing the final account of Frank H. Mott, receiver, defendants Hall appeal.
    Reversed.

      Elmer N. Peters, for defendants Hall.

      Leland H. Sabin, for defendant Mott.
   Stone, J.

This cause is before us for the second time. When first here it was disposed of upon its general merits, and will be found reported in 177 Mich. 495 (143 N. W. 622), where a full statement of the facts appears. The original bill was filed February 23, 1912, and alleged fraud on the part of defendants Hall in the sale by them of a stock of goods at Charlotte to complainant, who gave back to said defendants certain promissory notes secured by chattel mortgage on the stock. Before the filing of the bill defendants Hall had traded said notes and chattel mortgage to Blanche R. Mott (the latter having acted through her husband and agent, Frank H. Mott) for certain real estate in the city of Battle Creek. Blanche R. Mott was made a defendant. She answered, and claimed the benefit of a cross-bill, asking for affirmative relief. She claimed that she had acted in good faith, and, in case defendants Hall were found to have been guilty of fraudulent conduct, she asked to have her property at Battle Creek restored to her; she offering to transfer to said defendants Hall the said chattel mortgage and notes. In the original bill complainant had prayed for the appointment of a receiver, but had taken no further steps therein.

On March 4, 1912, Blanche R. Mott filed a petition in said cause, representing that she had purchased said mortgage on said stock; that it consisted of groceries, meats, and other things which usually go with a grocery store, meat market, and bakery, and that much of said stock was perishable; that complainant, after filing his said bill to set aside said sale, had closed said store, locked the doors, and turned over the keys to the sheriff; and that the store was then closed. She represented that said stock, if left in that condition, would depreciate, and much of it would become worthless, and her security would be greatly depreciated; that she was vitally interested in maintaining the value of said property; and that all the parties were more or less interested in maintaining it. She prayed that her husband, Frank H. Mott, be appointed receiver—

“To take possession and charge of the said stock of goods, situated in the city of Charlotte, Mich., and to care for and preserve said business, to the end that said business and property may be preserved for the persons who at the final decree of this court it is determined the same belongs to, and that the usual order appointing a receiver be made herein, with the usual power of receivers.”

On March 5, 1912, the court made an order which, after reciting that counsel for defendants waived notice of hearing, of the petition that a receiver be appointed (but not objecting thereto) to take possession and charge of the stock of goods located as above stated, concluded as follows:

“It is ordered, that Frank H. Mott, of the city of Battle Creek, Mich., be and he hereby is appointed: a receiver to receive all and singular the said property hereinbefore in a general way described, the same being the property in litigation in this suit, which was sold by said defendants Eugene H. Hall and Clarence M. Hall, to complainant, and which the bill in this cause is filed to set aside, and upon which a chattel mortgage was given by complainant to defendants Eugene H. Hall and Clarence M. Hall, and that Frank H. Mott, before entering upon his duties as such receiver, enter into a bond in the penal sum of $1,500, with sufficient surety or sureties to be approved of by the register of this court, conditioned for the faithful performance of his duties as such receiver, and that he will be answerable for what he shall receive, and shall dispose of the same as this court shall from time to time direct.
“It is further ordered that the parties to this suit, and each of them, do deliver over to the said Frank H. Mott, as such receiver, all of said property, and that upon such delivery the said Frank H. Mott, as such receiver, make a true and complete inventory and appraisal of all and singular of said property and file the same in the court in this cause.
“It is further ordered that the said receiver shall from time to time make a report to this court of his doings in this behalf, and that he be at liberty to apply to the court for further directions as he may deem necessary.”

Said receiver gave the required bond, and seems to have filed with, or shown to. the circuit judge an inventory of the stock amounting to $2,034.68.

.Upon a subsequent petition of Blanche R. Mott> the court made a further order extending the receivership to include the real estate at Battle Creek which she had transferred to defendants Hall, said receiver to take possession of, collect rents, and pay taxes thereon, etc.

Upon the final hearing of said cause, and on July 22,1912, the court made a final decree in favor of complainant. It ordered defendants Hall to reconvey certain property which they had obtained from complainant, and ordered the Battle Creek real estate to be reconveyed to defendant Blanche R. Mott, and she was directed to deliver up to complainant the promissory notes, and that the chattel mortgage be delivered up and canceled.

Said decree further provided as follows:

“And it is further ordered, adjudged, and decreed that Frank II. Mott, receiver appointed heretofore in this cause, make a final report of all his actions and doings as such receiver to this court, and upon settlement of his accounts as such receiver, he to deliver and surrender all of the property in his hands as such receiver to the defendants Hall, upon payment to him of his expenses as such receiver, and his compensation as such receiver hereafter fixed by the court; and that said Frank H. Mott have a lien on such property for such expenses and services.”

From this decree defendants Hall appealed, and on November 3, 1913, the decree of the circuit court was affirmed, and the case remanded to the circuit court. The cause having been remanded to the circuit court, an order was entered therein on November 25, 1913, requiring the defendants Hall to show cause on December 2, 1913, why the account of said receiver should not be allowed, and the expenses of said receivership paid by said defendants.

The expenses of receivership, as specified in said order, were as follows: Expenses of receivership, $50; attorney fees, $250; receiver’s salary for services, $1,880. At the time this order to show cause was entered no inventory, appraisal, or account of said receiver had ever been filed with the register of the court, nor had any copies thereof been served upon the. solicitor for defendants Hall, but, as we understand the record, such papers had been left or filed with the circuit judge at his chambers. On December 2, 1913, an order was entered in said cause allowing in all respects the said account of the receiver, except that the balance of rent collected by said defendants on the Battle Creek property was found to be $263.72, instead of a larger sum, as claimed by the receiver. This order provided that the.receiver should sell the grocery stock at public sale on December 12, 1913, and that the proceeds of the sale should be used, first, in payment of the debts contracted by the receiver in the purchase of stock, amounting to $751.30, second, in the payment of attorney fees, $250, third, in paying the expenses and disbursements of the receiver of $50, and, fourth, in the payment of the receiver’s salary of $1,880; that all sums after the.payment'of the foregoing items should be paid over to defendants Hall, after deducting from such balance the said sum of $263.72, found to be owing by said defendants to such receiver as balance of rents collected as aforesaid; that if the sum realized by the receiver at such sale should not be sufficient to pay all of the sums aforesaid, that the balance remaining unpaid should stand as a decree against said defendants Hall, and that execution might issue therefor.

On December 8, 1913, defendants Hall filed a motion to set aside the order of December 2d, for the reason that the order appointing said receiver did not authorize him to dispose of the property over which the receivership extended, except as the court should from time to time direct, and that no order or decree had ever been entered in said cause authorizing or empowering said receiver to conduct and carry on business with the property over which he was by said order appointed; that said receiver had without authority or right used the said property for the purpose of carrying on a general grocery business, which had been carried on at a great loss; that said receiver had never been authorized to employ counsel, and that his duty as such receiver had never been such as to justify and authorize the employment of counsel, and that all of the acts and doings of said receiver since the entry of said order appointing him such on March 5, 1912, had been unauthorized and illegal.

On December 11, 1913, said motion came on to be heard. Testimony was taken from which it appeared that said receiver, after the filing of his bond and making an inventory, had proceeded to carry on a retail grocery business with said stock, buying new goods to keep up the stock, and advertised the store as “Mott’s Store.” In the course of his cross-examination said receiver testified as follows:

“Q. You didn’t come down here and inform the court that there were perishable goods there that ought to be disposed of?
“A. Oh, yes; I informed him of that right on the start.
“Q. And you didn’t come down here and get an order authorizing you to make a sale'of this property?
“A. Yes; he told me to.
“Q. Well, told you, but did you make an application to this court for an order authorizing you to sell this property, and give the people notice, or did you come out here and see Charles B. Collingwood, and have a talk with him, and he told you what he thought about it, without any person being in court at all?
“A. Why, I came to him as the head, under which I was supposed to be working.
“Q. Not in court, however?
“A. Why, in his chambers.
“Q. And there verbally, and without notice to any other person, had some conversation with him?
“A. Very short.
“Q. What was it?
“A. After Mr. Stewart had been here and the order was issued appointing a receiver, I prepared my bond in Battle Creek; and I came up the next day and stepped into Judge Collingwood’s office. That was the second time I had ever seen him. I says T have this bond.’ He says, ‘You file them with the register.’ I went into the register’s office, and came back in, and he was doing some business. I says, ‘Well, what are my duties.’ ‘Why,’ he says, ‘you are supposed to go down there and take care of that property.’ And I says, ‘Well, I desire further and definite instructions.’ He says: ‘Mr. Mott, I am simply an officer of the court, and I do not run a grocery business; I know nothing about it. You are appointed for that purpose, and you are to go down there and use your very best judgment, keeping absolute and correct account of your doings, so that you will be ready to file them with this court.’ He says, ‘Keep an accurate account of your transactions;’ and he kind of turned away, and that was all there was to it. He went in to attend to his business, and I went on and took hold of the store, supposing I was to go there, as he specially told me. That was the day I filed my bond and before I had done anything as receiver. * * *
“Q. That is all the authority you have then for your acting, so far as any orders were concerned?
“A. I supposed the full authority was in the order.”

The record also shows that on the hearing of the cause in June, 1912, the receiver had testified that the occasion of his going to Charlotte was that he had been appointed to take charge of the Hall Bros, store, to keep it running while the dispute was being settled; that on cross-examination by defendants’ counsel he testified that he had been there some time conducting the business as receiver; that, as a matter of fact, he had been selling some of the fixtures.

“Q. Do you propose to go ahead and handle this business as a receiver and do whatever you see fit there, whether it is in the business as a going concern ?
“A. I am ready to account for them, and ready to explain it satisfactorily.”
“By the Court: Q. And, Mr. Mott, have you been able out of the receipts of the' business, besides its running expenses to pay anything on this mortgage?
“A. No, sir; I have had to put up money.
“Q. At the close of this case you will be ready to make a report?
“A. Yes, sir.”

On December 18, 1913, an order was made setting aside the sale made on December 12th, by the receiver to Blanche R. Mott; also setting aside that part of the order allowing $250 for solicitor’s fees for the receiver, but allowing the account of the receiver in all other respects. This order provided that defendants Hall should pay the receiver his salary of $1,880, his expenses of $50, and compensation from December 2d at the rate of $30 a week, and that, in default of such payment, the receiver should sell the property in his hands, after not less than three days’ notice; and further, “that said receiver may accept bids from any of the parties to this cause, and if said receiver receives no bid in excess of his fees as above named, he may himself take over said property for the amount of his charges and expenses as allowed above;” and further, “that if at said sale there is any surplus over and above fees and expenses of said receiver, such surplus shall be paid over to the defendants Eugene H. Hall and Clarence M. Hall, or to their solicitor.”

On January 2, 1914, said receiver took over the stock and property in payment of his receivership fees, salary, and expenses, which taking over and so-called sale was confirmed by an order entered on January 19, 1914.

Defendants Hall have appealed from the orders of December 2d, December 18th, and January 19th, above referred to.

It will be noted that the order appointing the receiver did not purport to confer upon him any authority to carry on the retail grocery business, or, in fact, any business. It appears that the receiver at once, after his appointment, proceeded to conduct a retail grocery business with the stock as a basis, buying additional goods to replace stock sold, and advertising the business as “Mott’s Store.” It also appears that the business was conducted at a loss, and that finally the whole property was closed out to pay the receiver’s expenses.

It appears from the evidence taken at the original hearing, above quoted, that the court and defendants Hall and their solicitor knew what was being done by the receiver. Either party might have applied to the court for an order requiring the receiver to sell the stock and pay the proceeds into court to abide the event of the suit, but nothing of this kind was done. The defendants Hall took an unsuccessful appeal to this court, thus prolonging the litigation, and knowing what the receiver was doing. Defendants Hall complain that they were not served with papers and were not advised of the doings of the receiver. The evidence is undisputed that they knew that he was carrying on a retail grocery store with the stock.

The whole proceeding was a most unusual and irregular one. The most charitable view which can be taken of it is that neither the court, parties, nor receiver understood the limited scope of the order. It is a well-settled rule that a receiver has no right to carry on and conduct a business, unless he is authorized or directed by the court so to do; and such authority is not derived from an order of appointment to take and preserve the property. 34 Cyc. p. 283, and cases cited; State Central Sav. Bank v. Chain Co., 118 Iowa, 698 (92 N. W. 712). In that case it was held that the extent of a receiver’s authority is always to be measured by the order of appointment, and such subsequent directions as may from time to time be given. The property is in custodia legis, and the receiver acts for the court, as its creature or officer, having no powers save those conferred upon him by its orders, or reasonably to be implied therefrom. It is true that in that case the statute required all orders to be in writing, but we think such statute declaratory of the general practice. In that case, as in this, the receiver claimed that he talked with the judge about the conduct of the business.

In Terry v. Martin, 7 N. M. 54 (32 Pac. 157), it was held that, in the absence of express authority from the court, a receiver placed in charge of a drug store, pending litigation, had no right to continue the business, and a bill of expenses presented was held properly refused. Many other cases might be cited to the same effect.

The objection to the appointment of the receiver is not available to the defendants Hall now. The decree of the circuit court, affirmed by this court, recognized the appointment and provided for the settlement of his account. It is only with that account that we can now deal.

The receiver was appointed at the instance and in the interest of Blanche R. Mott. It is urged that the store was conducted by the receiver in her sole interest, and that she and her husband, the receiver, have, with the aid of the court, been given the entire property, and that the defendants Hall have been turned out of court empty-handed, in so far as the property involved in the litigation is concerned. We must now take the situation as we find it. It would be impracticable to now set aside the sale. The stock has been in the hands of the receiver, as purchaser, since last January, and probably could not now be identified or followed.

We think the allowance of $1,880 to the receiver an unreasonable one. To. look after and protect the stock, getting leave to sell the perishable portion thereof, and collecting the rent and looking after the property in Battle Creek, probably may have been worth $380. We think that all in excess of that sum was unreasonable and inequitable. The sale should not at this late day be disturbed, but a decree should be entered here disallowing $1,500 of the receiver’s account for services, and a decree in favor of defendants Hall and against the said receiver for $1,500, to be paid on demand, should be entered, and Blanche R. Mott will pay said defendants their costs of this court to be taxed.

McAlvay, C. J., and Kuhn, Ostrander, Bird, Moore, and Steere, JJ., concurred. Brooke, J., did not sit.


author: Ostrander, J.

text:
    BARKWORTH v. CAMPBELL.
    Attobney and Client — Evidence — Set-Oee and Recoupment — Pleading.
    In an action upon a guaranty of the payment for attorney’s services to be performed by plaintiff for defendant’s son, evidence that plaintiff disbursed a sum of money which defendant had caused to be delivered to plaintiff in behalf of the son and for what purposes he expended it, was admissible, in contradiction of defendant’s claim that the money had been paid to plaintiff in payment for his services; although the facts were not shown in plaintiff’s bill of particulars.
    Error to Washtenaw; Kinne, J.
    Submitted June 16, 1914.
    (Docket No. 80.)
    Decided October 3, 1914.
    Assumpsit by Thomas E. Barkworth against Andrew Campbell on a contract of guaranty. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Frank E. Jones, for appellant.

      Thomas E. Barkworth and M. J. Cavanaugh, for appellee.
   Ostrander, J.

The form of action is assumpsit, the declaration special. It is alleged that plaintiff is an attorney and counselor at law and had been retained by one Robert Campbell, who was confined in the common jail of Jackson county, charged with having committed a crime—i. e., embezzlement and forgery—on the complaint of one Pauline Ragotsky, and charged with embezzlement on the complaint of one Charles Smith; that defendant, Andrew Campbell, in consideration of professional services thereafter to be rendered by plaintiff in the defense of said Robert in the matter of said charges, and in consideration of certain necessary moneys to be thereafter advanced by plaintiff in that behalf, made his certain written guaranty to pay plaintiff reasonable compensation for his services and repay him all the sums of money advanced and disbursed by him in and about the said defense upon the said charges; that plaintiff rendered services and advanced funds, which defendant afterwards agreed to pay. With his bill of particulars, plaintiff gave a copy of the alleged guaranty, which reads:

"Jackson, Mich., Oct. 12, 1908.
"In consideration of the services and disbursements of Thomas E. Barkworth as attorney for my son, Robert Campbell, I hereby guarantee the payment of all sums reasonably due for such services and disbursements as the same may accrue.”

The bill of particulars specified dates when services were rendered from August 8, 1908, to March 7, 1910, itemized expenses, and credit is given for $122.37. With the plea of the general issue, defendant gave notice that he would insist in his defense and give evidence to prove that he caused to be paid to plaintiff $1,000 upon the amount due to him, which was the reasonable compensation for the services and disbursements.

It appeared that one William Campbell, a brother of defendant, paid plaintiff $1,000 February 25, 1910. It is not mentioned in the bill of particulars. Upon what account it was paid, how and by what authority it was disbursed, are questions concerning which testimony was offered. All questions raised and debated grow out of this payment and its application as claimed by plaintiff. A verdict having been returned for plaintiff, and a motion for a new trial denied, judgment was entered on the verdict.

Under his assignments of error appellant contends that testimony about the purpose for which the $1,000 was paid to plaintiff and was disbursed by him was not admissible under the pleadings “as a basis of recovery by the plaintiffno allegation concerning the matter appearing in the declaration, and no items concerning it in the bill of particulars. The testimony was not offered as a basis for the demand asserted by plaintiff. Defendant was asserting that plaintiff had been paid, in this way, the whole or a part of his demand, and plaintiff explained that, while he received the money, it was paid, and he received it, to repay himself money which he had advanced to take up demands against Robert Campbell, any balance thereof to be credited on his account. Mr. Barkworth was the first witness for the plaintiff. Upon his cross-examination the check for the $1,000 was offered in evidence by the defendant, and Mr. Barkworth was interrogated concerning it and what was done with the money. It is clear that Mr. Barkworth was not precluded by anything in the pleadings from showing in what manner the money was disbursed by him and by whose authority it was so disbursed; was not precluded from showing that his demand had not been paid. An issue of fact was presented — a less doubtful one when all of the testimony is read than it appears from appellant’s brief to be — and this issue was submitted to the jury. The exceptions taken and the errors assigned relate, as has been stated, to this issue. A detailed examination of them here would profit no one. The testimony for plaintiff, and I find no rulings thereon which were prejudicially erroneous, tended to prove the services rendered and disbursements made within the terms of the written guaranty given by defendant, and negatived the fact alleged by defendant that the $1,000 was paid pursuant to the guaranty or the obligation which it created, except that a small balance thereof was, in fact, so applied. I see no reason for thinking that the statute of frauds is applicable upon either the plaintiff’s or defendant’s theory of the real issue. Certainly it is not applicable to the issue made by the testimony. In a short charge, which appears to me to be subject to no criticism, the court submitted the actual issue made by the testimony to the jury.

The judgment is affirmed.

McAlvay, C. J., and Kuhn, Stone, Bird, Moore, and Steere, JJ., concurred. Brooke, J., did not sit.


text:
    HICKS v. SMITH.
    1. Vendor and Purchaser — Specific Performance — Good Titee.
    Where complainant filed, a bill for specific performance of a land contract that contained a proviso requiring the defendant within one year to procure a marketable title by perfecting his tax interest, and it appeared that defendant had endeavored to clear up defects in his title, but had been unable to do so in the time limited, and later tendered back to complainant the amount which had been paid, and where the latter declined to receive the money, but notified him to proceed as quickly as possible to carry out the agreement, and it appeared that defendant had substantially complied with the terms of his contract, and the alleged defects remaining outstanding were trivial and insufficient as a ground of complaint, as that defendant had failed to serve notice on a second mortgagee, in one instance, the prior incumbrance having been foreclosed, so as to cut off the junior lien, the bill could not be maintained and complainant’s position and contention was inequitable.

      2. Costs — Appeal and Error.
    Where complainant, in a suit to compel the specific enforcement of a land contract, had ground to complain, which was remedied hy the decree of the trial court and costs awarded to him, and, on appeal, the decree requiring him to accept a warranty deed and to pay the balance due was affirmed, the costs on appeal should be paid by complainant, both parties joining in the appeal.
    Appeal from Allegan; Cross, J.
    Submitted June 17, 1914.
    (Docket No. 95.)
    Decided October 3, 1914.
    Bill by Eri G. Hicks against Joseph Smith and Fidus E. Fish for specific performance of a land contract, and to enjoin summary proceedings for possession of the premises. From a decree for defendants, but awarding costs to complainant, both.parties appeal.
    Affirmed, with costs of appeal to defendants.

      Ira Montague (Charles Thew, of counsel), for complainant.

      E. W. Stone (C. R. Wilkes, of counsel), for defendant Smith.
   Stone, J.

In this cause the bill of complaint was filed July 31, 1912, for specific performance of a land contract bearing date April 25, 1908, by the terms of which the defendant agreed to sell and convey to complainant three parcels of land consisting of 320 acres in Allegan county, and therein described, for $960, to be paid as follows: $100 on delivery of contract ; $400 18 months from the date thereof, and $460 30 months from date. It is undisputed that defendant’s interest in the land in question consisted of certain tax title claims, and that the notices required by law to be given to perfect title and the right to possession had not been given, at the time of entering into the contract, and that this fact was known to both parties. The contract was in the usual form in use in this State, and provided that the defendant, on receiving such payments at the time mentioned, should execute and- deliver to the complainant, or his assigns, a good and sufficient conveyance, in fee simple, of said described lands, free from all liens and incumbrances. It .gave the complainant the possession of the premises on delivery of the contract, and in case he failed to perform the contract, there was the right given to the defendant to declare the same void, and to remove complainant from the premises. The contract, however, contained the following written provision :

“This contract is given with the understanding and agreement between parties of the first and second part that, if party of the first part shall fail to procure title to the above land within one year from this date, after using every effort possible to secure same, all money paid on this contract is to be returned to second party, and this contract to become null and void.”

Only the first installment of $100 has ever been paid on the contract by complainant. No steps seem to have been taken to perfect title, by defendant, until early in the year 1910, when certain claimed statutory notices were given under defendant’s tax deeds. After this effort was made and after expiration of the time limited for payment, defendant tendered to complainant a warranty deed duly executed of the lands, and demanded payment of the amount due on the contract, or that he surrender the possession of the land, and the $100 paid was tendered in case complainant so elected. Defendant had in the meantime employed attorneys to give the requisite tax notices, and complainant had also employed counsel to look after his interest, under the contract. As early as April 5, 1911, complainant’s counsel wrote a letter to counsel for defendant, in which he stated that defendant’s title to one 80-acre parcel was satisfactory to complainant, the same having then recently been perfected. He then proceeded specifically to point out the claimed defects in the notices given by defendant, and the service thereof, and the defects in defendant’s title which he claimed still existed. Thereupon defendant’s attorney proceeded to serve new notices, and to perfect title of defendant in the premises, to meet the objections of complainant’s attorney; and it is the claim of defendant that through and by these later proceedings the title of defendant was perfected, and that complainant should have accepted the title. Complainant refusing to accept the title again offered, and refusing to accept the $100 paid, and surrender possession, the defendant served notice of forfeiture of the contract, and commenced summary proceedings before defendant Fish, a circuit court commissioner of the county, to obtain the possession of the premises. At this stage in the history of the controversy, the bill of complaint in the instant case was filed. The bill, among other things, states that the defendant Smith has neither secured the title to said premises, nor made any effort so to do; that he is not the owner of the premises, and is not entitled to the possession thereof, and cannot convey to complainant a title in fee simple, free and clear from all liens and incumbrances. Complainant alleges that he was then, and at all times had been, ready and willing to pay the balance due on said contract upon the delivery of a merchantable title. He prays that the contract may be specifically performed and carried into execution, and that in case defendant Smith fails to secure the title to said premises, complainant be authorized to secure such title, and be authorized to deduct the costs and charges of securing such title from the balance due on the contract.

The defendant Smith answered the bill, alleging that soon after the contract was executed effort was made on his part to perfect the title as required by the terms thereof; that it had proved more of a task than he had anticipated; that after the lapse of 18 months, the title had not been perfected, and he then told the complainant that he was willing to pay back the $100 and forfeit said contract, but that complainant then told defendant to proceed under the contract, and secure the title as soon as he reasonably could, in accordance with which understanding he did proceed in the clearing of said title in the manner thereinafter stated; that the condition of the title was well known to both parties at the time the contract was executed, and the clause quoted was inserted for that reason. The answer then proceeds at great length to set out the tax title interest which defendant had in the premises, and the steps taken by him and his counsel to perfect the title thereto. He asserts that he had complied with the terms of said contract and had secured title in fee simple to said premises, free and clear of all liens and incumbrances, and had on, to wit, May 22, 1912, tendered to complainant a warranty deed, signed and duly executed by himself and wife, of said premises, and had demanded of said complainant, as the sole and only condition upon which the same would be delivered, that he, complainant, comply with the conditions of said contract, and pay the remainder of the principal due, together with interest thereon as .provided in said contract; that complainant then and there refused to accept said deed, or pay said balance due, whereupon defendant did tender to the complainant the sum of $100, being the full sum he had paid on said land contract, which was refused, and thereafter said contract was declared to be forfeited by defendant and notice of such forfeiture was duly served, and the summary proceeding begun. Defendant prays the benefit of a cross-bill, and that complainant come to an account with him as to the amount due him on such contract; that the defendant be decreed to have complied with the terms of said contract, in that he has used every effort possible to secure the title to said premises, and that the title of defendant to said premises, subject to said contract, be decreed to be an absolute title in fee simple. In his answer to the cross-bill complainant admits that defendant had title to one 80-acre parcel of said land only. He denies that any legal notice had been or could be served upon all persons entitled to notice, after said defendant had sold said premises to complainant. Upon the hearing and in his brief and argument in this court complainant’s counsel took the position that as to one-half of the land in question the title rests in the government of the United States, and therefore that all taxes attempted to be levied, and the tax deeds issued in pursuance thereof, are absolutely void. The testimony was taken before the court, as in a suit at law, and the court found that defendant had perfected his title to said lands, and was then the owner thereof, and was in a position to perform his. part of said contract, and decreed that complainant should, within 30 days, accept a warranty deed of said premises, properly executed by the defendant and wife, and pay to the defendant the balance due as provided in said contract; that in default thereof complainant should surrender possession of said premises to the defendant upon the latter returning to him the $100 paid by complainant upon said contract. The trial court, being of opinion that complainant was compelled to file his bill of complaint, to require the defendant to perfect the title to said lands, awarded costs to complainant. Both parties have appealed, the complainant generally, and the defendant from that part of the decree awarding costs to complainant.

The complainant has by his pleadings and argument taken an anomalous and contradictory position in the case. He prays for a specific performance of the contract, yet he says that defendant cannot perform it, because he cannot give the notices required to perfect title, since he has sold the land to complainant, and he further asserts that the title to one-half of the land is in the government of the United States. If defendant is not able to perform, surely the complainant should accept the $100 paid by him and declare the contract at an end. If the court had jurisdiction to decree damages to complainant, he has not offered evidence of damages upon which a decree could be based.

Complainant’s position in the case does not appeal to a court of equity. When complaining of defects in defendant’s title, complainant was asked to go on and perfect it himself, and a court of equity would have reimbursed him for so doing, yet he refused so to do. He refuses either to accept the title offered, or to yield up possession of the premises and accept the $100 paid by him. After a careful reading of the record, we are of opinion that the trial court reached the correct conclusion in holding that the defendant had complied with his contract, by perfecting the title to the lands and is now the owner thereof, and is in position to convey a good title to complainant. Many of the objections of the complainant are purely technical and are without merit. For instance, in the chain of one of the titles, it appeared that there was a mortgage to one Bert Walters and W. J. Ostrander, bearing date July 30, 1901. It is objected that no notice was served on these mortgagees. Yet it appeared by the same chain of title that an earlier mortgage, bearing date March 25, 1889, given by the same mortgagor to another party, had been foreclosed, and a sheriff’s deed given, thus cutting off the later mortgage. There was no evidence in the case that this Walters and Ostrander mortgage was in force, or that anything was claimed for it.

It was further objected that notice should be served on complainant, because he was in possession. When service was made on complainant, in the second attempt to perfect title, then complainant objected that defendant could not give any notice at all because he had sold the land to complainant. We consider these objections purely trivial. We are of the opinion that the decree of the lower court should be affirmed. The only doubt we have had is whether the court should have awarded costs to complainant.

Upon the first taking of testimony it appeared that school district No. 1 of Pineplains township had a lease of one-half acre of the land “so long as used for school purposes,” and that one Wayne Andrews, a minor, had not been served, or brought in. These defects were later cured, but seem to have been the reason tor awarding costs to complainant. We are not disposed to disturb the decree upon the question of costs. Thirty days’ additional time should be given, from the date of decree, for performance.

The decree of the circuit court will stand affirmed, with costs of this court to defendant.

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


text:
    HURON LAND CO. v. LOBDELL-CHURCHILL MANUFACTURING CO.
    1. Taxation — Titee—Saxe.
    After the sale to the State of land for taxes and expiration of the period of redemption, the State’s title becomes absolute.
    2. Same.
    While the owner of the title ifiay buy in an outstanding title at an agreed price, he may not bargain orally for the interest in such a way as to extinguish it; and an uncompleted arrangement to buy in the tax title interest without a tender of the amount required by statute (Act No. 270, Pub. Acts 1909, amending section 141 of the tax law; 1 How. Stat. [2d Ed.] §1912), confers no rights on the original holder of the title.
    '3. Same — Compromise—Tax Titee.
    An oral arrangement between the owner and a tax title purchaser that the latter should reconvey his interest and receive credit for $50 on a claimed indebtedness due to the owner, without the payment or tender of money, did not extinguish the tax interest.
    4. Payment — Tendee.
    “Payment” imports the tender of money and its receipt by the person to whom it is offered.
    Error to Cheboygan; Shepherd, J.
    Submitted June 19, 1914.
    (Docket No. 15.)
    Decided October 3, 1914.
    Ejectment by the Huron Land Company, Limited, against the Lobdell-Churchill Manufacturing Co. Judgment for defendant on a directed verdict. Plaintiff brings error.
    Affirmed.

      H. K. Gustin, for appellant.

      Charles R. Henry and Victor D. Sprague, for appellee.

      The plaintiff claims to be the owner of the original title to certain land, and therefore owner of the timber growing thereon. ' Defendant, who is sued for the value of timber which it is claimed was cut and removed from the land, is assignee of the grantee of an owner of tax titles, admitted to be regular, but who had no right to possession of the land thereunder because no notice had been given to the original owner of the right to secure a reconveyance of the land. The land was wild, uncultivated forest land, in the actual possession of no one. Plaintiff offered testimony which it is claimed tends to prove an arrangement between its representative and the tax title owner by which the tax title interest was extinguished. Section 141 of the general tax law provides, among other things, that any person or persons entitled to a release and quitclaim under the provisions of the section shall have the right to redeem such lands from such sale by paying to the purchaser, on the certificate of the auditor general or his deputy, all sums paid as a condition of such purchase, together with 100 per centum additional thereto, etc.
    “By such payment the tax title and any and all such certificates of sale shall become void and of no effect against the lands to be redeemed.” Act No. 270, Pub. Acts 1909.
    The offer made to prove payment was:
    “We offer to prove that after Mr. Thomas Finan had purchased this tax title in 1902, in July, and before December, 1902, the witness Mr. Gustin met him at Tower, and Mr. Finan advised him that he had this tax title against the lands — against the S. E. ¼ of section 24, which included the S. E. % of section 24, to which the Huron Land Company held the original title, and he wanted to know from Mr. Gustin what the Huron Land Company desired to do about the matter; and by an arrangement with Mr. Thomas Finan upon the payment of $50, he permitted the Huron Land Company to redeem the S. E. ¼ of the S. E. v of section 24, from this tax title.”
    This offer was followed, the jury being absént, by a colloquy:

      “Mr. Gustin: We will follow it by showing that the $50 was paid.

      “Mr. Henry: That agreement, under your offer— this arrangement and this understanding was all verbal?

      “Mr. Gustin: It was.

      “Mr. Henry: And no papers have ever passed between you and Thomas Finan in reference to the redemption ?

      “Mr. Gustin: No, except the payment of the $50.

      “Mr. Henry: And that did not take place at that time; but you propose to show that by some arrangement which you had in Tower, in some other deal, $50 was considered payment?

      “Mr. Gustin: Yes, sir; we paid the $50 afterwards.

      “Mr. Henry: Was it $50 paid direct to Thomas Finan?

      “Mr. Sprague: In cash?

      “Mr. Gustin: No.

      “Mr. Henry: Did you hold any receipt from him, or writing, that $50 was paid for the purpose of redeeming?

      “Mr. Gustin: No.”
    The court expressed the purpose to receive the testimony, the jury was recalled, and the following testimony was given:
    “Some time in the fall of 1902, after Thomas Finan had purchased * * * well, it was in the fall—it was before December, 1902. He advised me that he had purchased a tax title against the S. E. ¼ of section 24, in town 33, range 1 west; and upon looking up the record, he found that the Huron Land Company owned this S. E. ¼ of the S. E. ¼ of section 24. I was doing considerable law business for the Finans, and he wanted to know what I wished to do, or the Huron Land Company wished to do, in reference to this description; and we figured up the amount of taxes as nearly as we could, upon this description of land, and he told me if we wished to redeem it for $50, he would permit us to redeem it. And I told him that the Huron Land Company would redeem it, and that I would give him credit, or Finan & Finan credit, upon their account for my services in the matters I was handling for them. And this was the arrangement and understanding by which the Huron Land Company redeemed this S. E. ¼ of the S. E. ¼ of 24.

      “Q. Did you, from that time afterwards, or the Huron Land Company, pay the taxes on those lands?

      “A. We did — always paid them.

      “Q. Is there anything else, Mr. Gustin?

      “A. I do not think of anything else.”
    And this:

      “Mr. Henry: I would like to ask Mr. Gustin, because it may save a day’s time, if this credit to Mr. Finan appears of record in your books ?

      “Mr. Gustin: In my books? No, it does not.

      “Q. So that there is absolutely no writing in your possession evidencing this, even in your own books of account?

      “A. No.

      “Q. And was any conveyance made — reconveyance, by Thomas Finan, or any one for him, or any of his grantees, to you pursuant to this verbal arrangement that you speak of?

      “A. It was made, but he never delivered it to me.

      “Q. Did you ever have any correspondence, by letters pro and con, about it?

      “A. I don’t know whether I did or not.

      “Mr. Reilley: Was there any notice ever served by any one under that tax title on the Huron Land Company at any time?

      “A. Not to my knowledge.

      “Mr. Henry: Did you ever, since that time, have a settlement with Thomas Finan, in which-this $50 was brought into account?

      “A. Yes, sir.

      “Q. Was any part of that in writing?

      “A. No.

      “Q. By bills rendered, pro and con?

      “A. No.

      “Q. That all rests in parol?

      “A. My settlement for services and everything else was all in parol.

      “Q. Did you have a running account with him at the time, or was this a separate transaction?

      “A. No; I just had a running account for services —an account for services. I done certain work for them. There was no account made of it.

      “The Court: Was the Huron Land Company charged with $50?

      “A. I think they were, your honor.

      “Mr. Henry: Have you any record of that in the Huron Land Company’s books?

      “A. I think there is. I am not positive on the question, because I have not investigated it.”
    It may be stated, further, that Mr. Thomas Finan testified (his deposition was taken) that plaintiff never paid nor tendered him any money for a reconveyance of the premises, and no one claiming to be owner or to have any interest in or lien on the land ever paid or tendered to him any money for the purpose of securing a reconveyance of the tax title interest. The court struck out the testimony and instructed the jury to return a verdict for defendant, stating that:
    “The defendant had acquired the timber from one William Gillis, who had acquired it from James Finan, who had acquired it from Thomas Finan, who was holding it under a tax title.
    “That this tax title was unredeemed and was a subsisting tax title at the time of the removal of the timber in question from the land and its acquirement by the defendant company, and is yet unredeemed.
    “The Huron Land Company, the plaintiff, is therefore not in position to maintain this action for the injury to the premises, or for the property removed from it. * * * ”
   Ostrander, J.

(after stating the facts). Adhering to former rulings (Griffin v. Kennedy, 148 Mich. 583 [112 N. W. 756]; Horton v. Helmholtz, 149 Mich. 229 [112 N. W. 930]; Haney v. Miller, 154 Mich. 340 [117 N. W. 71, 745]; Haney v. Auditor General, 165 Mich. 681 [131 N. W. 174]; White v. Dunsmore, 167 Mich. 548 [133 N. W. 523]; Powell v. Pierce, 168 Mich. 427 [134 N. W. 447]; Holmes v. Soule, 180 Mich. 526 [147 N. W. 621]), which we are asked by appellant to re-examine and to modify to the extent of holding that some interest in the land remains to the owner after regular sale of it for taxes and after the period of redemption expires, we consider only whether the court erred in striking out the testimony above referred to and directing a verdict for defendant. We conclude that no error was committed. In Backus v. Hoyt, 164 Mich. 407 (129 N. W. 693), we affirmed a decree for a reconveyance of land, it appearing that a legal tender had been made to the tax title holder by the owner of the original title. In Wilson v. Sauble, 181 Mich. 406 (148 N. W. 165), an action of ejectment, we held that a court of equity is the proper forum for determining whether or not the owner of a title cut off in tax proceedings is entitled to a re-conveyance from the tax title owner who refuses it; that he does not acquire title by a tender of money, the right to make which is disputed. In the present case, there is no claim that plaintiff paid the amount which the statute requires to be paid to secure a reconveyance. At best, the testimony of the plaintiff tends to prove an arrangement, never completed, to buy the tax title interest. There can be no question about the right of an owner of land to buy in an outstanding tax title for an agreed price. But, except for the statute, he would be obliged, as against all persons dealing with the owner, and upon the disclosures made by the record, to secure the tax title interest so purchased by some conveyance or writing. The words of the statute negátive the proposition that by any uncompleted private bargaining the interest of the tax title owner can be extinguished. The words, “on the certificate of the auditor general, or his deputy,” have some significance. The word “payment” imports a tender of money and its receipt by the person to whom it is tendered. The benefit of the statute is for those who perform the conditions upon which the benefit attaches. A refusal of a proper tender may be relieved against in equity.

The judgment is affirmed.

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