text:
    John W. Jones v. Benjamin J. Van Bochove.

      Deed — Easement—Bight of way — Abandonment.
    1. A cement company owned a maxi bed, and, being desirous of building a railroad from the bed to its factory, secured a deed from the owner of the intervening land by which the grantor conveyed to the grantee a “ certain piece or parcel of land * * * described as follows, to wit: The right of way for a railroad running from the maxi bed of said cement company to its works, * * * and described as follows: A strip of land 40 feet wide, being 20 feet on each side of the center line as now located of the said company’s railroad [describing said center line], the whole length of said strip of land being 952 feet.” And it is held that the deed conveyed an easement, and not a fee.
    2. After operating its factory for a time, the cement company failed, and its successors never engaged in the manufacture of cement. The factory was sold and torn down, the railroad taken up, the fences inclosing said right of way were removed, and a bridge spanning a river lying between the factory and the marl bed was torn down. And it is held that such nonuser, with so clear an intent to abandon as is shown by said acts, amounted to an absolute abandonment of the easement.
    Error to Kalamazoo. (Buck, J.)
    Argued November 1, 1894.
    Decided December 18, 1894.
    Trespass. Plaintiff brings error.
    Affirmed.
    The facts are stated in the opinion.

      If. 0. Bliss (W. G. Howard, of counsel), for appellant.

      William Shakespeare and Boudeman é Adams, for defendant.
   Long, J.

In 1876 the Eagle Portland Cement Company was the owner of a body of land in the township of Kalamazoo, county of Kalamazoo, upon which there was a marl bed. The marl bed and land were some distance 'east of the-river road and of the Kalamazoo river. The company was at the same time operating a factory on the west side of the river, about three-fourths of a mile west of the marl beds, and at which factory the marl was manufactured into cement. In the above year, the company, being desirous of building a railroad from the beds to the factory, piirchased of George W. Winslow the right •of way over a strip of land along the line of its proposed road, 40 feet wide and 952 feet long. In the January following, Winslow deeded to the company all the land he •owned on that section north of said railroad strip, and being about 2$ acres. This land (and, it is now claimed, also the railroad strip) came to the plaintiff by an unbroken chain of title, the plaintiff acquiring title April 1, 1891.

Several years before the plaintiff claimed title to the land, the cement company failed, and its property passed, •on foreclosure of mortgage, into the hands of Bush & Patterson. They never carried on the business of manufacturing cement. They sold the manufacturing buildings and land, and the buildings were torn down. They took down the bridge over the Kalamazoo river, over which the railroad passed, took up the iron rails and sold them, took up some of the ties and permitted others to be taken up, allowed the fences inclosing the railroad strip to go to decay; and, as Mr. Patterson says, in doing these acts they intended to abandon the manufacture of cement and the railroad. In the meantime, George W. Winslow died, leaving his real property to his four children. The title to his real estate comes to the defendant by an unbroken chain of title. This strip of land lies north of Winslow’s other lands of which he died seised, and defendant claims this strip under his deeds’from the children of Winslow. It will be seen, therefore, that the strip lies between plaintiff’s and defendant’s lands, and each claims title to it. ' The defendant is now in possession, and is cultivating it. Plaintiff, claiming such acts were trespasses upon his close, brought an action of trespass in justice’s court for damages. Defendant pleaded title, and the cause was certified to the circuit for trial, where the court directed a verdict in favor of defendant.

The principal controversy arises over the construction of the deed made by George W. "Winslow to the Eagle Portland Cement Company. The granting clause reads:

All that certain piece or parcel of land situate * * * and described as follows, to wit: The right of way for a railroad, running from the marl bed of said cement company to their works, on the west side of the Kalamazoo river, and described as follows: ‘A strip of land 40 feet wide * * * and 952 feet in length.”

■ The deed is in the usual form of a full covenant warranty.

We think the court below was correct in holding that the deed conveyed an easement only, and not a fee. It ■ does not purport to convey a strip of land 40 feet wide, etc., but the right of way over a strip 40 feet wide. Cases, undoubtedly, can be found in which the operative words of the grant relate to the land itself; but such construction cannot be given to this deed. Where the land is first conveyed, and then a provision afterwards inserted, showing what the land is to be used for, it is held in many cases that the fee is conveyed, and the clause providing for what the land is to be used is a condition subsequent; but this deed is not open to that construction. It is clear that an easement only was here intended. Flaten v. City of Moorhead, 51 Minn. 518; Rohinson v. Railroad Co., 59 Vt. 426.

It is further contended that "the court erred in holding that the right of way had been abandoned. The evidence is uncontradicted that the railroad was taken up, the rails and ties removed, the fences taken away, and the bridge across the river torn down. The acts of abandonment seem to have been complete, and, if anything more was needed, Mr. Patterson testified that all these acts were done for the purpose and with a view to abandon the right of way. In a note to Wyman v. Hurlburt, 40 Am. Dec. 467, it is said:

“ Whether non-nser of an easement, unaccompanied by other acts inconsistent with the exercise of such rights, will be sufficient to warrant the presumption of an abandonment, is determined largely by the fact of how the easement originated, — whether by express grant or by prescription. It is said that in the former case no presumption of abandonment arises from non-user, no matter how ' long the same may be continued, if the owner of the servient estate does no act interfering with its use.”

But Mr. Justice Holmes, in his note to Kent’s Commentaries (volume 3, p. 449), says:

“There seems to be no sound distinction between easements created by deed and those acquired by prescription.”

And he lays down the broad doctrine that, no matter how the easement was acquired, non-user for a less time than that required by the statute of limitations for the perfection of the easement is no presumption of an abandonment. But it seems to be settled that, when the non-user is accompanied by acts on the part of the owner of either the dominant or servient tenement which manifest an intention to abandon, and which destroy the object for which the easement was created or the means of its enjoyment, an abandonment will take place. Davis v. Gale, 32 Cal. 26; Canny v. Andrews, 123 Mass. 155; Ward v. Ward, 7 Exch. 838; Reg. v. Chorley, 12 Q. B. 515; Hale v. Oldroyd, 14 Mees. & W. 789; Williams v. Nelson, 23 Pick. 141; Dyer v. Depui, 5 Whart. 584; Mowry v. Sheldon, 2 R. I. 369; Crain v. Fox, 16 Barb. 184. Mere non-usér may not amount to an abandonment, but non-user with so clear an intent to abandon as here shown amounts to an absolute abandonment; so that the right to the possession and use must be held to have vested in the defendant.

Some other questions are raised, which we do not think warrant discussion under the view we take of the questions-here discussed.

The judgment below must be affirmed.

McGrath, O. J., Grant and Montgomery, 33., concurred. Hooker, J., did not sit.


source: Caselaw Access Project

author: Montgomery, J.

license: Public Domain

text:
    Valentine Lewis, v. Charles M. Sheldon.

      Landlord and tenant — Lease upon shares — Forfeiture-Summary' proceedings.

    A lease upon shares is not assignable without the consent of the-lessor, and its attempted assignment and delivery of possession thereunder to the assignee works a forfeiture of the lease, and the lessor may take immediate steps to regain possession; . citing Randall v. Chubb, 46 Mich. 311.
    Error to Clinton. (Moore, J., presiding.)
    Argued November 2, 1894.
    Decided December 18, 1894.
    " Summary proceedings to recover the possession of land. Defendant brings error.
    Affirmed.
    The facts are stated in the opinion.

      Lyon é Dooling, for appellant.
    ' Fedewa é Walbridge, for complainant.
   Montgomery, J.

This is a summary proceeding to recover possession of a farm in Clinton county. On April • 11, 1892, the complainant leased to one James Kennedy the farm in question on shares. Kennedy went into possession of the land under the lease, and remained in possession until September 18, 1893, when he made an assignment thereof to the defendant, Sheldon. The lease was assigned by Kennedy after the complainant had notified him that he objected to his doing so, and that he claimed that the lease was not transferable to the defendant. The complainant learned of the assignment three days after it was made. On or about the 22d of September, he caused notice to be served on Sheldon, the defendant, not to do any work on the land. On the 29th of November this proceeding was instituted to get possession, under section 8295, How. Stat.

But two questions are raised: First, it is claimed that the court erred in holding that the lease was not assignable; and, second, it is contended that the defendant became a tenant at will, and entitled to three months’ notice to quit.

The lease, in form, is not to be distinguished from that which was passed upon by this Court in Randall v. Chubb, 46 Mich. 311. The defendant earnestly contends against the doctrine of that case, but we see no reason to doubt its correctness. The conclusion was that the nature and character of the lease show that it was a personal one with the lessee, and could not be assigned by him to a third party without the consent of the lessor. Moreover, the doctrine of the case has become a rule of property, and certainly ought not to be overturned without the very best of reasons, which we do not think exist. Nor do we think the other cases in Michigan cited by defendant’s counsel are in conflict with the ruling there made.

The same case is authority upon the question of the right of the complainant to recover possession. It was said:

Tbe attempt to assign this lease, and put another in possession thereunder, worked a forfeiture thereof, apd enabled the lessor to take immediate steps to regain possession."

See, also, Wilkinson v. Williams, 51 Mich. 155; Benfey v. Congdon, 40 Id. 283.

The judgment will be affirmed, with costs.

The other Justices concurred.


author: Grant, J.

text:
    Melvina R. McCammon and Hannah Rice v. The Detroit, Lansing & Northern Railroad Company.
    [ See 66 Mich. 442.]

      Practice in Supreme Court — Assignments of error — Deed—Recording laws — Evidence—Mortgage foreclosure — Sheriff’s deed.

    1. Where the correctness of the ruling of the court in directing a verdict depends entirely upon the correctness of prior rulings admitting certain evidence, error should be assigned upon such earlier rulings as well as upon such direction.
    2. An objection to the introduction in evidence of the record of a deed executed in another state, and certified so as to entitle it to record under the law then in force in this State, on the ground that the certificate does not show another fact made essential by a later statute, is untenable.
    8. The introduction in evidence of a sheriff’s deed executed on the foreclosure by an assignee of a mortgage by advertisement under chapter 218, Comp. Laws 1871, was objected to because:

      ■a — The notice of sale did not state at what particular place the sale would be made.

      b — The notice did not state where the assignment of the mortgage was recorded.

      c — The notice did not assert that the sale would be made to the highest bidder.
    d — There was no proof that any showing was furnished the sheriff prior to or at the time of the sale that the notice of sale had ever been published at all.
    e — There was no proof that the mortgaged premises were offered for sale, bid upon, or struck off to the highest bidder.
    / — There was no proof that the deed was “forthwith” deposited with the register of deeds.
    And said objections are disposed of as follows:
    a — “At the court-house in the village of Mason, Ingham county” (being the county in which the mortgaged premises were situated), sufficiently described the place of sale.

    b — A failure to give the book and page where the assignment was recorded was not a fatal omission, its date and the ■date of its record being given.
    c — An “auction sale” implies a sale to the highest bidder, and it will be presumed that a sale, made pursuant to a notice that the mortgaged premises would be sold at public auction, was made to the highest bidder.
    d — The production of copies of the newspaper in which the notice of sale was published, showing its publication for 13 consecutive weeks prior to the sale, was sufficient proof of the publication required by the statute, and it was not necessary that the sheriff should, at the time of the sale, have an affidavit of such publication before him.
    e — In the absence of proof in the printed record that the sheriff’s deed was filed with the register of deeds, it will be presumed that the deed was so filed.
    / — The sheriff’s deed, which (as appears by the original record) was filed on the day of the sale, but not acknowledged by the sheriff until five days afterwards, was notice to the mortgagor, and he was not deprived of the right of redemption.
    .Error to íngham. (Person, J.)
    Argued November 2, 1894.
    Decided December 18, 1894.
    Ejectment. Defendant brings error.
    Affirmed.
    The facts are stated in the opinion.

      M. V. & B. A. Montgomery, for appellant.
    ■ Cahill & Ostrander, for plaintiffs.

      The statute provided that the sale should be made “at the place of holding the circuit court within the county in which the premises to be sold, or some part of them, are situated.”

   Grant, J.

After the decision in 66 Mich. 442, defendant took a new trial under the statute, at which the plaintiffs again recovered judgment. In the chain of title shown by the plaintiffs upon the trial, the record of two deeds-was introduced, to each of which the defendant objected, upon the ground that the deeds were not properly certified to entitle them to record. The original deed executed by the sheriff of Ingham county upon a foreclosure sale by advertisement was also introduced, under objection and exception. The defendant introduced no evidence, and the-court directed a verdict for the plaintiffs.

Only one error is assigned, viz., that the court erred in directing a verdict. The correctness of this ruling depends entirely upon the correctness of the ruling admitting these deeds. No error is assigned upon the admission of the testimony. We think counsel should have assigned error upon the rulings of the court admitting the evidence. Johnson v. Ballou, 25 Mich. 460; Alberts v. Village of Vernon, 96 Id. 549; Hecock v. Van Dusen, 96 Id. 573. We are, however, inclined, under the circumstances of this-case, to dispose of it upon the merits.

Of the first two deeds above mentioned, one was executed in the state of New York and the other in Connecticut. Defendant’s counsel suggest, rather than insist, that they were inadmissible, under Brown v. Cady, 11 Mich. 535. They were executed and recorded in 1839. The certificates attached thereto bear date, respectively, July 1 and July 12, 1839. The objection is that the certificates do not state that the deeds were executed according to the laws of these states. This was not required by the registry law then in force. Laws of 1839, Act No. 115, p. 219, § 34. This law only required the certificate to state that “the officer taking the acknowledgment is-such officer as by his certificate of acknowledgment he purports to be, duly commissioned and qualified.”

The objections to the sheriff’s deed are as follows:

“1. The notice of sale did not state at what particular place the sale would be made.'

“2. It did not state where the assignment of the mortgage was recorded.

“3. It did not assert that the sale would be made to the highest bidder.

“4. There is no proof that any showing was furnished the sheriff prior to or at the time of the sale that the notice of sale had ever been published at all.

“5. There is no proof that the premises were offered for sale, bid upon, or struck off to the highest bidder.

“6. There is no proof that the sheriff’s deed was f forthwith’ deposited with the register of deeds.”

The notice of sale stated that it would take place at the court-house in the village of Mason, Ingham county. This description of the place was sufficient. The notice contained all the requirements of the statute. Comp. Laws 1871, § 6915.

An auction sale implies a sale to the highest bidder, and it will be presumed that it was so made.

The notice gave the date, time, and place of the record of the original mortgage, the date of the assignment, and the date of its record in the office of the register of deeds in Ingham county. The omission to give the book and page of the registry, as that was not required by the statute, was not a fatal defect.

Attached to the deed was a copy of the notice of sale, but no affidavit of its due. publication. Plaintiffs produced upon the trial copies of the newspaper showing the publication of this notice for 13 consecutive weeks prior to the sale. This proved the publication required by the law. We are cited to no case which holds that the proof was not competent, or that it was necessary' that the sheriff should, at the time of sale, have before him an affidavit of' such publication. The statute contains no such requirement, and the necessity of any such proof being made a part of the deed is rebutted by section 6926, which provides a method for perpetuating such evidence if the purchaser so desires.

It does not appear from the printed record that the sheriff’s deed was filed with the register. In the absence of such proof, we think the correct rule is stated in Sinclair v. Learned, 51 Mich. 337, — that “it would seem that the presumption of law that an officer performs his duty ought to prevail until the fact is disproved.” We find, however, upon an examination of the original record, that there is indorsed upon the deed, “Received and filed April 22, 1858, at 4 p. m.,” — the very date of the sale. The law was therefore strictly complied with. It appears, however, that the deed was not acknowledged by the sheriff until April 27; and it is contended that “the owner was thus cheated of the right of redemption by paying the register of deeds during that five days.” A purchaser cannot thus be deprived of an otherwise valid sale. The deed was filed, and was notice to the mortgagor, and he cannot be held to have been deprived of the right of redemption.

Judgment affirmed.

The other Justices concurred.


author: Hooker, J.

text:
    Theodore C. Sherwood, Commissioner of the Banking Department of the State of Michigan, v. The Central Michigan Savings Bank. In the Matter of the Petition of Daniel B. Johnson.

      Banks and banking — Special deposit — Trust—Following fund— Insolvency — Waiter. ,
    1. Two mortgages belonging to a depositor were paid to his bank, with which he had left them for collection, and, in violation of his instructions, the money was, after being credited for a time to a fictitious account, passed to his credit. And it is held:
    a — That the bank acted in the matter as agent for the depositor, and that the relation of debtor and creditor did not exist as to such collection.
    b — That, if the bank took the responsibility of receiving checks in payment of the mortgages, the checks belonged to the depositor, if he chose to receive them, and it was the duty of the bank to use due diligence in collecting, the money on the checks, and, when paid, such, money became the property of the depositor.
    c — That if the money became mingled with the bank funds by the act of its officers, as between the depositor and the bank, the former had a lien upon the whole fund, and the court will not be overtechnical or zealous in seeking an opportunity to say that the money cannot be traced, or has disappeared from the fund altogether, where there is evidence from which the contrary may be legitimately inferred.
    d — That the receiver of the bank, which closed its doors on the day the money was credited to the depositor, took the assets of the bank charged with the legal and equitable obligations previously resting upon the bank, so far as its interests are concerned; that whatever, if any, modifications there may be of the right of the depositor to a lien upon the fund must result from the rights of general creditors, and the favorable disposition of the law towards an equal distribution of insolvent estates, as evidenced by the legislation upon the subject; citing Stone v. Dodge, 96 Mich. 521.

      e — That, as the evidence discloses that the fund on hand showed a balance in excess of the amount of the trust fund each day from the receipt of the money until the doors of the bank were closed, there is no reason for indulging in a presumption that at some time during those days the fund was lower, especially as such fact, if true, would he demonstrable from the books of the bank.
    / — That it is unnecessary, under the modern authorities, to find that the fund which came into the hands of the receiver included the identical money received by the bank, where, as in this case, it appears that the money treated as a trust fund was a component part of the money in the hands of the bank.
    2. Shortly before, and. on the same day, that the bank closed its doors, a representative of the depositor called for the money, and was at first informed by the cashier of the bank that he could not pay it, but the cashier finally paid a portion of the same, and gave a draft for the remainder, which was never paid. And it is held that, as the draft was received in reliance upon the false representations that the bank could not pay the money collected, it cannot be said that the depositor waived his right to claim the fund.
    Appeal from Ingbam. (Person, J.)
    Argued November 2, 1894.
    Decided December 18, 1894.
    Petition to require the receiver of the Central Michigan Savings Bank to pay to Daniel B. Johnson certain funds claimed to have come into the hands of the bank as agent before the failure.. The receiver appeals.
    Decree affirmed.
    The facts are stated in the opinion.

      Oahill & Ostrander, for petitioner.

      M. V. & R. A. Montgomery, for the receiver.
   Hooker, J.

The Central Michigan Savings Bank of Lansing closed its doors and went into the hands of the Commissioner of Banking on April 18, 1893, being insolvent. Subsequently, on a bill filed in the circuit court for the county of Ingham by the bank commissioner, George W. Stone was appointed receiver, and took possession of the property of the bank. On May 19, 1893, Daniel B. Johnson filed his petition in said cause, asking that the receiver be required to pay over to him the sum of $7,206.96, which he claimed that said bank held in trust for him, to the exclusion of the claims of other creditors. An answer was filed, and upon the hearing, upon proofs taken in open court, a decree in accordance with the prayer of the petition for $5,581.96 was made, from which the receiver appealed.

The testimony shows that Johnson was a depositor in said bank, and that he was the owner of two real-estate mortgages, upon which there was due upon April 14, 1893, about $10,581.96. Johnson died before the hearing. His son, Frank Johnson, testified that the mortgages were put in the bank, he supposed by his father, for collection, and were there some time, and that the witness left some discharges of these mortgages at the bank to be delivered upon payment. He continued:

“ Q. Now, what instruction, if any, did you leave for Mr. Bradley, when you left those discharges?

“A. My father’s instructions and mine both were that as soon as those mortgages were paid to notify us, — notify me there at the store, because the most convenient. * * *

“ Q. Was anything said by you or by your father to Mr. Bradley about that money being placed to his credit in the bank when it was paid?

“A. I remember this: my father telling him that he didn’t want it to go to his credit; that he had a place for it. And I told Mr. Bradley distinctly that we wanted to be notified as soon as that was paid; let us know, as father had a place for it, — then had a place for $5,000 money; and he wanted it just as soon as it was.paid in.”

This testimony is undisputed. It also appears that the amount paid upon the mortgages was not credited upon the account of Johnson, but was credited to cashier’s aécount” until the 18th of April, when it was carried to Johnson’s account, apparently with debits consisting of a cash payment of $5,000, and a draft, wbicb will be mentioned later. Petitioner asks relief, upon the theory that this was a special deposit; that it was the duty of the bank to collect the money, and hold it for him, and not treat it as money paid to the bank in the ordinary way, subject to be mingled with other moneys of the bank, credit to be given to petitioner; and that, although the bank did mingle it with other funds, it was wrongfully done, and the fact would not prevent petitioner’s recovery thereof if the bank still had sufficient of the fund on hand. Evidence was introduced showing that the bank had more than the amount claimed on hand at all times after the mortgages were paid until the receiver took possession.

On behalf of the receiver it is contended that the petitioner was not entitled to the relief granted for several reasons:

1. Because the bank did not receive payment in money.

2. Because it received nothing, unless it was a credit with some other bank, and there is no proof that it ever received a dollar upon that credit.

3. Because, if it was a trust fund, it was divested of that character by the act of the petitioner’s agent.

Bradley testified that he delivered the discharges upon receipt of the checks of the building and loan association. He had previously said that $4,300 of the money to pay up the mortgages was furnished through Mr.- Ostrander, and the Capitol Building & Loan Association furnished the remainder that was paid. This is all that we discover in the testimony upon the subject of the method of payment. The respective amounts appear credited to the cashier’s account, as already stated. Whether these checks were payable upon Lansing banks or foreign banks does not appear. Section 3 of the petition alleges that the amount claimed “was paid to the said Nelson Bradley on the 14th day of Ajoril, 1893, and that he thereupon held the money on behalf of petitioner as his agent, and delivered the notes, mortgages, and discharges to the person who paid the same.” Section 7 of the answer “admits that on April 14 last the amount due upon the mortgages was paid to the cashier,” — i. e., Mr. Bradley; also that the notes and mortgages were delivered, etc. It denies that the bank held the money on behalf of the petitioner as agent. Section 8 of the answer “denies, upon information and belief, that said money was not, when so received by said cashier, deposited with the funds of the bank, but was by him held and kept as a separate deposit for petitioner until April 18;” and it avers, on like information and belief, that “ when said money was so received by said cashier it was by him placed in the vaults of said bank, with the other currency belonging thereto, and the amount thereof was at once entered on the books of the bank, in what is known as the ‘cashier’s account,’ to the credit of said petitioner.” The witness Augustus Crane, an employé of the bank, stated that the cashier’s account “shows money that was left in the bank for a short time, to be paid out without starting a special account for that money or credit.”

The evidence quoted, together with the allegations of the petition which were admitted by the answer, may be said to establish the fact that the bank was expressly prohibited from placing the proceeds of the mortgages to the credit of the petitioner in any such way or sense as to establish the relation of debtor and creditor between the bank and himself, and that the bank received the money. Force is added to this by the fact that the petitioner was not credited, but the amount was carried in a fictitious account, called “cashier’s account.” Moreover, there is nothing to show that this money was at once mingled with other funds, unless it be the answer, which says that when said money was so received it was placed in tbe vaults of said bank, with other currency belonging thereto.’ This statement is not necessarily inconsistent with .the idea that the fund was kept separate; nor is the fact — if it be one — that previous to April 18 it was included in daily balances, which was obviously necessary if the bank books were to be made to show a balance. The averment in the answer has no force except as a pleading and by way of admission, unless supported by evidence. It was the duty of the bank to collect and pay over to the petitioner the money, and it was his agent for the purpose, and the proceeds of the mortgages were his property as much as the mortgages were. If the bank took the responsibility, of receiving checks, they were his checks, if he chose to receive them; and it was the duty of the bank to use diligence in collecting the money upon the checks, and,, when paid, such money became the property of the petitioner. Bank v. Armstrong, 39 Fed. Rep. 684; Morse, Banks, §§ 214, 248; McLeod v. Evans, 66 Wis. 401. We find, therefore, under the pleadings and evidence, that the bank received the money, and in the capacity of agent, and that the title to such money was in the petitioner.

It remains to inquire whether the right to recover the same has been cut off — First, by the action of the bank or receiver in mingling the funds, or not keeping them separate, so that the identity of the money received- is lost; or, second, by the acceptance by the petitioner’s agent of $5,000 in cash and a draft upon a Detroit bank for the remainder of the amount. As already stated, it is not shown that the money was mingled with other funds when received. It seems, however, to be conceded that at some time it was mingled, either by the bank or the commissioner or the receiver, and practically it makes little difference which, except as it might bear upon the question

whether the fund of which it became a part had, at any time prior to the filing of the petition, been exhausted, so that it can be said that the fund then sought to be reached not only did not contain any of the identical money, but that, treated as a fund, it was wholly from a different ■source. If it be decided that the money became mingled with bank funds by the act of the officers of the hank, there can be no doubt that, as between petitioner and the •bank, the former had a lien upon the whole fund; and ■courts would not be overtechnical or zealous in seeking an opportunity to say that the property could not be traced, or had disappeared from the fund altogether, where there was evidence from which the contrary might be legitimately inferred. There is no claim that the receiver took the assets of the bank discharged of any legal or •equitable obligations previously resting upon the bank, so far as the interests of the bank are concerned. Whatever, if any, modification there may be upon this statement, must result from the rights of general creditors, and the favorable disposition of the law towards an equal distribution of insolvent estates, which is obvious from the legislation upon the subject. Stone v. Dodge, 96 Mich. 521. If' the trust actually existed, and the identical fund received had been intact when it came into the hands of the receiver, it would have been subject to the petitioner’s •claim. Why should it be any less so if it is clear that the fund into which it went (such fund being money legally belonging to the bank) never was reduced to the .amount of the trust fund? The bank could not comjfiain, for the decisions are numerous that the claim of the cestui ■que trust would become a lien upon the entire fund when the intermingling occurred, and the law would presume that the trust fund was not paid out as long as an equal .amount remained. Silk Co. v. Flanders, 87 Wis. 237, and cases cited. See Wisconsin Marine & Fire Ins. Co. Bank v. Salt & Lumber Co., 77 Mich. 81. The evidence discloses that the fund on hand showed a balance in excess of the amount of the trust fund each day from the receipt of the money until the doors of the bank were closed. There is no reason why we should indulge in a presumption that at some time during those days the fund was lower, especially as it should be demonstrable from the books of the bank, in the hands of the receiver, if it were true. We have reached a point, then, where it may be said that the fund which came to the receiver contained the trust fund, but it is necessarily impossible to say that it included the identical money received by the bank. But that is unnecessary, under the modern authorities, where it appears, as we find here, that the money treated as a trust fund was a component part of the money in the hands of the debtor. We think it unnecessary to enter at length upon a discussion of this question or citation of authorities. The briefs of counsel for the appellee contain them, and the subject was recently reviewed by the supreme court of Wisconsin in the case of Silk Co. v. Flanders, supra. See, also, Cavin v. Gleason, 105 N. Y. 256, where many authorities will be found.

We'think the Michigan cases cited by counsel for the appellant are not at variance with this doctrine. In the case of Wisconsin Marine & Fire Ins. Co. Bank v. Salt & Lumber Co., 77 Mich. 81, this Court declined to apply the doctrine therein cited from the Janeway case, that,—

“Where the trust property does not remain in specie, but has been made way. with by the trustee, the cestui que trusts have no longer any specific remedy against any part ■of his estate in bankruptcy or insolvency, but they must come in pari passu with the other creditors, and prove against the trustee’s estate for the amount due them.”

In Sherwood v. Bank, 91 Mich. 78, 82, the case was •decided upon the point that—

“There was no appropriation of the proceeds of the •check; no mingling of the money realized from it with the assets of the bank for its own benefit, as there was no money realized from it; nor any use made of it by the bank, either to pay off its debts or to increase its assets.”

The remaining question may be easily disposed of. The evidence shows that the bank closed its doors on April 18. Shortly before, and upon the same day, petitioner’s agent called for the money, and was informed by Mr. Bradley that he could not pay it. He finally paid $5,000, received in the meantime from Mr. Bement, and gave a ■draft on Detroit for the remainder, which draft was never paid. We have found that the statement that the bank had not got the money, or what, under the circumstances, was equivalent, that it could not pay the sum collected, was untrue, because at the very time the amount lay in its vault as a part of its assets. If, under such false representation, the petitioner received the draft believing and relying upon the false statement, it cannot be said that he waived his right to claim, the fund. A waiver usually ■involves an intention to yield some known right, or something equivalent to such intention, in the nature of an ■estoppel. There is no such estoppel here. It would be much more equitable to say that the bank and .its receiver are ■estopped from claiming such an estoppel.

It remains to be said that the decree will be affirmed, with costs.

The other Justices concurred.

      Counsel cited: McLeod v. Evans, 66 Wis. 401; Carley v. Graves, 85 Mich. 483; Sherwood v. Bank, 94 Id. 78; First Nat. Bank of Crown Point v. First Nat. Bank of Richmond, 76 Ind. 561; Kimmel v. Dickson (S. D.), 58 N. W. Rep. 561; Peak v. Ellicott, 30 Kan. 156; Ellicott v. Barnes, 31 Id. 170; Harrison v. Smith, 83 Mo. 210; National Bank v. Insurance Co., 104 U. S. 54; Jewett v. Dringer, 30 N. J. Eq. 291.


author: McGrath, C. J.

text:
      August Guerold v. Henry C. Holtz.

      Pleading — Assignee of chose in action — Trial—Appeal—Replevin— Demand — Verdict—Judgment—Instructions to jury — New trial.

    1. One of two partners, as successor of the firm, brought replevin for a piano sold by the firm to the defendant upon a contract-reserving title in the firm until the puróhase price should be paid. On the trial the plaintiff testified without objection to-the purchase by him of the interest of his partner in the firm business, and that he had succeeded to all the firm assets. No question was raised by the defendant upon the trial, or upon his motion for a new trial, as to the right of the plaintiff to recover because of his failure to prove an assignment to him of the contract. And it is held that the question cannot now be considered.

    2. The court instructed the jury that if they found that, before-the suit was commenced, plaintiff demanded a return of the piano, that such demand was refused, and that at that time-the defendant was in default, plaintiff was entitled to recover. There was undisputed testimony to such demand and refusal, and no question was raised on the trial as to the sufficiency of the demand or of the proofs to support the instruction. And it is held that the defendant cannot insist for the first time on appeal that no demand was made.
    8. The jury found generally in favor of the plaintiff, and, in response to questions by the court, found further that $58 of the purchase price of the piano was still due the plaintiff, and that he had a lien upon the piano (which was not recovered upon the writ) for that amount. The verdict, as entered, was that the defendant did unlawfully detain the property, and that the damages of such detention amounted to $58. A judgment was entered upon the verdict, which, after reciting said findings, adjudged that the plaintiff should recover said damages, together with his costs and charges to be taxed, and that he have execution therefor. And it is held:
    a — That the entry of the verdict and judgment was not. warranted by the findings.
    b — That the defendant is not prejudiced by the fact that the verdict was, in form, under How. Stat. § 8342, which provides-that “when either of the parties to an action of replevin, at the time of the commencement of the suit, shall have only a lien upon, or special property or part ownership in, the good»' and chattels described in the writ, and is not the general owner thereof, that fact may be proved on the trial, or on the assessment of value, or on the assessment of damages, int all cases arising under the chapter, and the finding of the jury or court, as the case may be, shall be according to such fact, and the court shall thereupon render such judgment as shall be just between the parties;” that the verdict disposes of all the questions growing out of the transaction, and in a manner most favorable to the defendant; that the judgment entry may be corrected so as to give plaintiff a judgment for the balance found to be due on the contract, with costs, and provide for the payment of said sum within a given time,— otherwise, that the property be delivered up and sold to satisfy such judgment, and that plaintiff have execution under How. Stat. § 8344, which provides that the execution to be issued upon a judgment rendered under How. Stat. § 8343, for the replevy and delivery to the plaintiff of property not recovered upon the writ, shall command the sheriff to levy the plaintiff’s damages and costs of the goods and chattels, lands and tenements, of the defendant, as in other executions against property, and also to replevy the goods and chattels described in. the declaration, which shall also be specified in the execution, and to deliver them to the plaintiff, if they can be found within the county, and, if not, then that he levy the value of such goods and chattels, specifying the same, together with the aforesaid damages and costs, of the goods and chattels, lands and tenements, of the defendant, as above provided.
    4. The sole contention of the defendant on the trial was that nothing remained due under the contract of purchase; hence, that he was entitled to the possession of the piano. And it is held that his present contention that the jury determined no issue except that as to the amount due on the contract is untenable; that if the $58 was due, and defendant had refused to pay it (which latter fact was not disputed), plaintiff was, under the contract, entitled to the possession of the piano upon demand therefor, and as a matter of law the detention was unlawful.
    5. The verdict as entered is not conclusively presumed to be the verdict as rendered. The bill of exceptions, when filed, became a part of the record, and contains the action of the court prior to the time when the verdict was put in force by the clerk; and the entry made by him does not necessarily compel the Court to conclude that the, bill of exceptions is in any respect untrue.
    Ü, A defendant in replevin is not prejudiced by an instruction which, as he claims, fixes the value of the property as the measure of plaintiff’s damages, where the jury assess no sum as damages.
    7. Where the only ground urged in support of a motion for a new trial is newly-discovered evidence, and the same is merely cumulative, there is no abuse of discretion by the circuit judge in refusing the motion.
    Error to Wayne. (Donovan, J.)
    Submitted on briefs November 20, 1894.
    Decided December 18, 1894.
    Replevin. Defendant brings error.
    Reversed, and record remanded for judgment in accordance with the opinion.
    'The facts are stated in the opinion.

      George G. Green (E. F. Bacon, of counsel), for appellant.

      Broolce & Spalding, for plaintiff.

       For cases hearing upon the questions of the necessity of averring the assignment of a chose in action in a suit thereon by the assignee under How. Stat. § 7844, the sufficiency of such averment, and the estoppel of the debtor to object on account of its absence, see Morrill v. Bissell, 99 Mich. 410, and note; Robinson v. Watson, 101 Id. 466.

       For cases bearing upon the proper construction of and practice under How. Stat. § 8342, see Upham v. Caldwell, 100 Mich. 265. and note; Olin v. Lockwood, 102 Id. 443.

   McGrath, C. J.

Plaintiff, as successor of Guerold & Fairchild, brought replevin for a piano sold by said firm upon a contract reserving title in the vendors until the full price with interest was paid. The principal sum was paid, but a controversy arose as to a balance of interest amounting to $58. It was insisted by defendant that the piano was delivered under an oral contract, which did not contemplate interest, and that the written contract was afterwards presented, and executed by defendant in ignorance of the fact that it contained a promise to pay interest. This seems to have been the sole question litigated, and upon that issue the jury found for plaintiff. No assignment is based upon the refusal of the court to give any charge requested by defendant’s counsel.

The court instructed the jury that—

"If the jury find that the contract under which the piano was bought by the defendant was the contract produced by the plaintiff, and provided for the payment of interest; that the defendant broke the conditions of this contract; that possession of piano was thereupon demanded by the plaintiff, and refused by the defendant, — then the plaintiff is entitled to the possession of the piano in suit.”

It is alleged that this was erroneous, for the reason that the contract was one between Guerold & Fairchild and defendant, and no assignment was proved. Plaintiff’s testimony was that he had purchased his partner’s interest in the business, and succeeded to all the firm assets. No question was raised upon this subject, either at the trial or upon the motion for a new trial, and the question cannot now be considered.

The court instructed the jury that if they found that, before the suit was commenced, plaintiff demanded a return of the piano, that such demand was refused, and that at that time defendant was in default, plaintiff was entitled to recover. It is now insisted that no demand was made. 'There was testimony that plaintiff demanded the piano, and that defendant refused to surrender - possession; and •such testimony was not disputed, nor was any question raised before either court or jury respecting the sufficiency -of the demand, or the sufficiency of the proofs to support the instruction.

It is urged as error that the court instructed the jury "that—

" If the jury find that the plaintiff is entitled to recover possession of the piano, they are also to determine from all the evidence the value of the piano, — that I have already stated, — fix the damages for the unlawful detention.”

It is alleged that this was error, for the reason that it. fixes the value of the piano as the measure of damages. The piano had not been recovered under the writ. Plaintiff was therefore entitled, in addition to a judgment for damages and costs and for the delivery of the property, to have its value assessed by the jury. How. Stat. § 8343. The-instruction was correct, except that it omitted the word “and” between the words “stated” and “fixed.” This-was a repetition of an instruction which had been given, wherein the court had separated the question of value and the question of damages for detention. In view of the fact that the jury assessed no sum as damages, the defendant was not prejudiced.

The entry, however, of the verdict and judgment, is not warranted by the finding of the jury. The jury found generally for plaintiff, and fixed the sum of $58 as the amount due plaintiff under the contract, and further found that he had a lien upon the piano for that amount. They assessed no damages for the detention of the property. Plaintiff is not here complaining, but seeks only to obtain the balance which the jury found to be due. Defendant is not prejudiced by the fact that the verdict is, in form, under How. Stat. § 8342. The verdict disposes of all of the questions growing out of the transaction, and in a manner most favorable to defendant. It does not warrant the entry that the jury assessed the damages for the de.tention at the sum of $58, but the judgment entry may be corrected so as to give plaintiff a judgment for that sum, with costs, providing that the same be paid within, a given time, — otherwise, that the property be delivered up, and sold to satisfy such judgment on delivery as aforesaid, and that plaintiff have execution under How. Stat. § 8344.

We do not concur in the view that the jury determined no issue except that as to the amount . due. They had been instructed that, if they found certain facts, the plaintiff was entitled to recover. They brought in a verdict for the plaintiff. Defendant’s sole contention was that nothing remained under the contract of purchase; hence, that he was entitled to the possession of the property. The jury found a balance due plaintiff of $58. If this amount was due, and defendant had refused to pay it (and the fact of refusal was not disputed), plaintiff was clearly, under the contract, entitled to possession upon demand therefor, and as a matter of law the detention was unlawful.

Nor do we think that the verdict as entered must be conclusively presumed to be the verdict as rendered. The bill of exceptions, when filed, becomes a part of the record. It contains the action of the court prior to the time when the verdict is put in force by the clerk. That entry made by the clerk does not necessarily compel us to conclude that the bill of exceptions is in any respect untrue. Fromme v. Jones, 13 Iowa, 474; Moody v. McDonald, 4 Cal. 297.

A motion was made for a new trial, but the only ground urged, not already discussed, was that of newly-discovered evidence. The contract in question expressly provided that defendant should pay interest upon the purchase price until paid. A copy of the paper was left with defendant. The real question was whether any deceit, fraud, or misrepresentation had been used to induce defendant to execute the paper. The newly-discovered evidence was merely cumulative, and related to a conversation had some days before the contract was executed, as to the terms of the sale. We do not think that the circuit judge abused the discretion reposed in him, in refusing to grant a new trial.

The judgment entry in the cause will be vacated, and judgment entered in accordance with the suggestions herein made, and the record will be remanded for that purpose. No costs in this Court will be granted to either party.

The other Justices concurred.


text:
    Lewis H. Chamberlain v. The Detroit Stove Works.

      Corporations — Salary of officer — Contract—Separate employment— Evidence.

    1. Unless it can be said that the evidence offered by the plaintiff wholly fails to show a right to recover, such right is, at least, a question of fact for the jury, upon the testimony.
    2. The president of a corporation, whose power to make contracts with employés had been recognized, agreed with its secretary to increase his salary for a given year from $5,000 to $6,000. In a suit by the secretary to recover said increase and other claims, it appeared that his services were performed under said agreement, and the issue on this branch of the case was as to whether or not the plaintiff had agreed with the president to postpone the payment of the increase, as plaintiff testified, or, in view of the fact that the business of the corporation had not been prosperous for said year, had agreed to waive the payment of said increase of salary, as testified by the defendant’s president. And it is held that the defendant cannot complain of an instruction that the $1,000 should be allowed if the jury should fifnd that the agreement was simply to postpone its payment, it appearing that the time of such postponement, if one was agreed upon, had expired.
    8. An employé of a corporation was elected its secretary, and, after serving in that capacity for several years at an annual salary, his official relation was terminated, after he had served for a portion of the current year, by the election of a successor. At the expiration of the year he sued the corporation to recover the balance of the yearly salary, upon the theory that his employment was distinct and separate from the office of secretary, the duties of which were nominal; that he was employed by the corporation before his election to the office of secretary; that his duties after his election were substantially the same as before; and that his employment was by the year, at an annual salary. The defendant, on the other hand, claimed that, as secretary, the plaintiff had no claim upon the corporation beyond the tenure of his office, and that, although he held over for a portion of the year by reason of the failure of the corporation to elect directors, his term of office was regularly terminated as before stated, and that the corporation was under no obligation to keep or pay him longer. And it is held:
    a — That, while the right of the corporation to terminate plaintiff’s official relation at the time it did so is unquestionable, it does not conclusively follow that another relation, dependent upon the engagements and contracts of the parties, did not exist.
    b — That while it appears that no express employment occurred at the beginning of the year, or at any other time for several years, the circumstances might warrant the conclusion that the parties mutually understood that it was to continue; that what the relation was, and how long it was to continue, depended upon the original hiring, the subsequent relation, the nature of the services performed, and the mutual understanding of the parties.
    c — That it was competent for the jury to determine from the evidence that the hiring was annual, and not subject to revocation or change by the board of directors; that, while a contract for a year could not exist unless the circumstances warranted the inference that the parties so understood it, such agreement or understanding may be inferred from a custom or usage which the parties may be considered as having contemplated.
    4. Error is assigned upon certain testimony given by the plaintiff on rebuttal, contradicting that of the defendant as to a certain statement alleged to have been made by the plaintiff, on the ground that it was a repetition of his testimony given in making his case. And it is held that, if such denial had been previously made, as claimed, it was unnecessary to repeat it; that such denial is not pointed out by counsel, and, if it had not been made, it was properly received on rebuttal; and that in either case it was not an abuse of discretion to admit it, in case of doubt as to its having been made.
    Error to Wayne. (Donovan, J.)
    Argued November 2, 1894.
    Decided December 18, 1894.

      Assumpsit. Both parties bring error.
    Affirmed.
    The facts are stated in the opinion.

      Maybury & Lucking (John D. Conely, of counsel), for plaintiff.

      F. A. Baker, for defendant.
   Hooker, J.

The defendant is a manufacturing corporation organized under the act of 1853, by the terms of which act its management is lodged in a board of directors elected annually. The officers, including president and secretary, were elected annually. In June, 1885, the president died, and was succeeded by the vice president, Mr. Barbour, who was regularly elected president in the following January, and has since held the office.

Previous to the death of the former president, the plaintiff was employed in the office of the company at an annual salary of $3,500. Having acquired some stock, he was made a director at the annual meeting of the stockholders in January, 1886, and upon the same day he was elected secretary, and was regularly re-elected each year up to and including 1891. In December, 1886, he was credited with $3,500, and in April, 1887, with $500, for salary in 1886, and in December, 1887, with $4,000 for the year 1887. The testimony upon both sides shows that in January, 1889, a conversation occurred between the plaintiff and the president, wherein it was agreed that the plaintiff's salary should be $5,000 for 1888, and $6,000 for 1889. The plaintiff stated that it was agreed that he should have $6,500 for 1890, and he thought, but was not positive, for 1891 also. Mr. Barbour stated that the conversation covered two years only, and that nothing was said about a salary of $6,500. The plaintiff was paid $5,000 for 1888. They agreed that he did not receive $6,000 for 1889, and that only $5,000 was credited. Chamberlain’s version is that in January, 1890, a talk was had, in which he agreed to waive for the time being the advance in salary, until such time as he (the president) could, or until such a future time as he would, make it good; that, with that understanding, Chamberlain would postpone the payment of it; and that Barbour would ultimately make it good to him. The talk grew ■out of the fact that the yearly balance was unsatisfactory. He said further that the $1,000 was to be paid later. Mr. Barbour stated that Mr. Chamberlain said to him, “It has not been a prosperous year, and 'you can make my ■salary the same as last year, — $5,000;” and that not a word was ever said about the payment of $1,000 at a subsequent time. Chamberlain was credited with and drew $5,000 a year from that time.

In May, 1892, the annual meeting which should have been held in January, 1892, was held. Chamberlain was not elected director. The new board met the same day, and another was elected secretary in place of Mr. Chamberlain. On May 10, 1892, the president sent a letter to Chamberlain, requesting his resignation; saying that Mr. ■Shaddinger would succeed him, and that his salary would be allowed to July 1. To this Chamberlain responded, •claiming the full year’s salary, in view of his not having received notice in January, and also in view of the agreement made when his salary was advanced in 1888. He ■also asked him, in considering the proposition, not to forget that Mr. Tefft, the former president, had intended to present him (Chamberlain) with stock to the value of $1,000, which intention Barbour had repeatedly said that he would, in due time, make good.

After the year expired he commenced this action, claiming (1) $1,000 for the year 1889; (2) $1,500 for back salary for 1890; (3) $1,500 for back salary for 1891; (4) $219.26 for balance of salary for June, 1892; (5) $2,500' for salary from July 1 to December 31, 1892; (6) $1,500 for additional salary for 1892, to make $6,500. It seems to be conceded that he recovered only for the 1st, 4th, and 5th items. Both parties appeal, defendant contending that he should not have been allowed to recover any sum, as he stopped working May 31, 1892.

The agreement to pay $6,000 for 1889 is clearly proved, and it is as satisfactorily shown that the services were fully performed under that arrangement. It is significant that-no credit was ever made of the $1,000, and that no demand for the same was ever made; also that in his letter the plaintiff did hot demand $1,000 as his due upon the salary for 1889, but asked consideration of the 1888 agreement in connection with his offer to terminate his connection with the house on the basis of such a settlement.” Unless we can say, however, that the evidence wholly fails to show a right to recover, we must find, at the least, a question of fact for the jury, upon the testimony. Counsel's brief says that—

The transaction, as stated by the plaintiff, is so indefinite and shadowy that the court below should have instructed the jury not to allow this item. His evidence might be sufficient to warrant the submission of the question to the jury, if Mr. Barbonr had been acting for himself; but when it is remembered that he was simply the agent of the corporation, and that both he and the plaintiff were members of the board of directors, I submit that there is not enough in the transaction, as stated by the plaintiff, to bind the corporation.”

No claim of fraud or collusion between the two directors is charged, and for several years the plaintiff's increase of salary from $4,000 to $5,000 has been paid without question by the other directors or stockholders. Apparently the power of the president to make contracts with employés has been recognized. If there is anything indefinite and' shadowy, it was what occurred at the close of 1889, rather than the arrangement to make the salary $6,000, which Barbour admits. It being shown that the services were performed under this promise, we think that the defendant cannot complain of the instruction that the item should be allowed by the jury if they should find that the agreement was simply to postpone payment.

^he jury evidently found that the plaintiff was entitled to pay for the whole year 1892 at the rate of $5,000. This was apparently npon the theory that his employment was by the year, at the salary which was paid and accepted for the previous years. Defendant's position is that, as secretary, plaintiff had no claim upon the company beyond the tenure of his office, and that although he held over, from a failure to elect directors in January, 1892, his term of office was regularly terminated in May by the election of a successor as secretary, and the company was under no obligation to keep or pay him longer. On the other hand, the plaintiff claims that his employment was distinct and separate from the office of secretary, whose duties were nominal; that he was employed before he held the office, and that his duties after his election were substantially the same; that his employment was by the year — his salary, annual.

There can be no doubt of the correctness of the defendant's position as to the right of the defendant to terminate the plaintiff's official relation at the time it did so, but we think that it does not conclusively follow that another relation did not exist, dependent upon the engagements and contracts of the parties. It appears that no express employment occurred in January, or at any other time for several years, but we think the circumstances might warrant the conclusion that the parties mutually understood that the employment was to continue. What the relation was, and how long it was to continue, depended upon the original hiring, the subsequent relation, the nature of the services performed, and the mutual understanding of the parties, ^s to duration, we think it was competent for the jury to determine from the evidence that the hiring was annual, and not subject to revocation or change by the board of directors or the president. It perhaps goes without saying that a contract for a year could not exist unless the circumstances warrant the inference that the parties so understood it. Such agreement or understanding may be inferred from a custom or usage which the parties may be considered as having contemplated/ See 2 Pars. Cont. 33; Tallon v. Mining Co., 55 Mich. 147; Sines v. Superintendents of Poor, 55 Id. 383; Bradley v. Covel, 4 Cow. 349; Evertson v. Sawyer, 2 Wend. 507. We think that the court properly left this question to the jury.

Upon rebuttal the plaintiff was asked the following question:

Q. Mr. Barbour stated that at the end of the year 1889 you came to him and said, ‘‘ Make my salary §5,000, the same as last year/ and that not another word was said. Is that true?

“A. No, sir.”

Error is assigned hpon this, as a repetition of the testimony given in making plaintiff’s case. Technically speaking, if the plaintiff’s version of that transaction, given on direct, was credited by the jury, they could not credit Barbour’s statement that “that was all that was said.” It is possible that plaintiff had previously testified that he did not go to Barbour, and make the statement mentioned. If he did it was unnecessary to repeat it. Counsel does not point us to such denial, and if it was not previously made it was proper in rebuttal. In either case we cannot say that it wmuld have béen an abuse of discretion to admit it, in case of doubt of such previous denial.

This disposes of the questions raised by the defendant, as nothing was recovered for back salary for 1890 or 1891, as appears from defendant's brief.

It is unnecessary • to discuss the questions raised by the plaintiff's appeal, the same being voluntarily waived unless the case is to be reversed upon defendant’s appeal.

The judgment will be affirmed.

The other Justices concurred.


author: Long, J.

text:
    Frank B. LeClear v. Thomas B. Perkins and Fidelia M. Richmond.

      Malicious prosecution — Attachment—Probable cause — Malice—Advice of counsel — Evidence.
    1. Want of probable cause and malice must concur, to entitle the plaintiff to recover in a suit for the malicious prosecution of a writ of attachment.
    3. In an action for the alleged malicious prosecution of a writ of attachment, the defendant may show that he acted under the advice of counsel, before whom he had placed all' of the facts, and the jury may consider such advice in determining the questions of probable cause and malice.

    3. The testimony of plaintiff’s bookkeeper as to her knowledge of his business and financial affairs at the time of the attachment, and his efforts to borrow money, was admitted, and those elements were included in the charge to the jury as part of what was claimed by the defendants to justify the attachment, she having previously communicated such facts to them. And it is held that the testimony was competent and admissible as bearing upon the questions of probable cause and malice, and to enable the jury to say whether the defendants did more than what careful and prudent men would have done under like circumstances; citing Brand v. Hinchman, 68 Mich. 601.
    Error to Kent. (Grove, J.)
    Argued November 20, 1894.
    Decided December 18, 1894.
    Case. Plaintiff brings error.
    Affirmed.
    The facts are stated in the opinion.

      Maher & Salsbury, for appellant.

      Sweet & PerJcins, for defendants.

       For cases bearing upon the effect of legal advice as a defense in an action for malicious prosecution, see Harris v. Woodford, 98 Mich. 147, and note; Govaski v. Downey, 100 Id. 429; Thompson v. Price, 100 Id. 558.

   Long, J.

This is an action for damages for the malicious prosecution of a writ of attachment. The writ of attachment was issued and levy made February 24, 1891. It was dissolved by an order of Judge Adsit, of the Kent circuit, March 7, 1891. This suit was commenced October 19, 1893. The ground of issuing the attachment was that the defendant in the writ (plaintiff here) was about to assign and dispose of his property with intent to defraud his creditors.

Mr. Le Clear, the defendant in the writ, was a photographer at Grand Rapids, and was indebted to defendants in the sum of about $500. Before the%writ of attachment was sued out, a Miss Sherman, who was an employé of .Le Clear, came to Mr. Perkins, one of the defendants, and made certain statements as to Le Clear’s affairs. Mr. Perkins testified upon the present trial as to what was said on that occasion by Miss Sherman, as follows:

“ Q. State what, if any, conversation you had with Miss Sherman, leading to the attachment which you commenced.

“ A. Miss Sherman had spoken to me about getting her another position three or four days before this attachment. The attachment was commenced on Tuesday, February 24. On Saturday before the attachment, she came into the store, and asked if I had heard of any position for her, .and it was then that this conversation took place in refer•ence to why she wanted to or was going away from Mr. Le Clear’s. She said it was because business was so dull that he could not keep her any longer. I asked her how ■dull the business was. She says, ‘We are doing next to nothing.’ I said: ‘How many negatives is that?’ She says, ‘A good many days we don’t make a negative, and in •one week was only one negative, and that was of some flowers.’ And I says, ‘ How is it that he can pay expenses ■on so little work as that?” and she said he could not, as she saw; she didn’t see how he could. And I said, ‘It looks to me as though our claim was in a pretty poor shape.’ ■She says, ‘How much is your claim?’ I told her it was a little more than $500. ‘Well,’ she said, ‘I don’t see how you are ever going to get it, because he Owes so much already, and his creditors are pushing him so hard for their claims that he has resorted to hiding from them, and asking me to state when they came that he is not there, when in fact he is. He has also expressed himself as afraid of you,— particularly so.’ I think, right then, I asked her why she was going to Cadillac, when I saw her a few days before, —if she had expected to get a job there, — and she said, ‘No; I was going on business there for Mr. Le Clear.’ I said, ‘What business for Mr. Le Clear up there?’ And she said, ‘To borrow money.’ I inquired from whom, and she told me a Dr. Ward, a friend of hers that was there, that loaned money sometimes. I asked her what security Le Clear proposed to give to this Dr. Ward, and she said, -‘A mortgage on the gallery.’

Q. Was the amount mentioned?

“A. Yes; I think that she said $1,250 was the amount he wanted; but she said he had failed to get that money, and that now he was going to Detroit, and asked her to wait until he could get back. I said, ‘ When is he going .to Detroit?’ She said, ‘In a day or two, but he don’t ■want me to let any one know that.’ And I said, ‘What ■.does that mean, — that he don’t want any one to know it? Does that mean mischief?’ ‘ Well,’ she says, ‘you can draw your own conclusion as to what it means.’ I says, ‘Don’t it look to you as though he intends to do something that he don’t want the creditors to know?’ She says,- ‘That is the way it looks.’ And I says, ‘What do you think that means?’ She says, ‘I think it means that he intends to transfer his gallery to his father.’ ‘ Why do you think that?’ ' Because his father, when here a short-time before, told Frank that he would not help him one more dollar until he had either turned the gallery over to-him, or given him a mortgage for security;’ that Frank had refused to do that, on the ground that if the ' old man,’ as he called him, got hold of it, he (Frank) would be left out in the cold, and have nothing; and that he at-that time was expecting or hoped to get money from this-Cadillac party, but now that he had failed in that he was going to Detroit, as she believed, ‘ to turn his gallery over to him, as the last resort.’ Then I said: 'That would look as though it would bo necessary for me, in order to-secure myself,'to make some move, and that right away. Wouldn’t it to you?’ She says, 'Yes, I do. If you can secure yourself, I would do it; but, whatever you do, do-at once, because I believe if he goes to Detroit he will transfer the gallery, and you will never get a cent out of' your claim.’

“Q. I will ask you, Mr. Perkins, what information, if' any, at that time, you had, relative to the amount of Frank Le Clear’s indebtedness.

“A. I knew at that time - that he owed nearly all of these claims that he has testified' about himself, including—

“Q. From whom did you get your information?

“A. A great majority from Frank himself, and some from Miss Sherman at that time.

“Q. Did you get this from Frank in his conversation?

“A. No. He had been telling me at different times within the past, — we will say two or three months prior to this February 24, when I had been talking with him about paying our debt.

“Q. Did he volunteer the information in regard to other indebtedness?

“A. He had offered that as an excuse, where he had made some other payments, for not paying ours. Then I had quizzed him as to what he was owing, and found out that he was owing the Phoenix people, which I had no idea that he was owing; knew he had bought his house on a contract. And the Ocher & Ford matter, — I did not know anything about it until I asked him about it, what he was owing so much for, something like that.

“Q. Had you asked him about that, and received information about it, prior to this talk with Miss Sherman?

“A. Yes, sir.

“Q. After that conversation, what was the next thing-you did, or what did you do, if anything, regarding the collection of that claim?

“A. This conversation took place on Saturday, — I have-referred to, — and Monday I went to Mess. Butterfield &• Keeney, and saw Mr. Butterfield, and told him all the-facts I have set forth here, as near as I can remember now, and I asked him if there was anything I could do-to protect myself against a loss in that case. Mr. Butter-field thought a few moments, and he says: fYes; you

can get out a writ of attachment. It is your only course to pursue.’

Q. "What was done then ?

“A. He then called Mr. Keeney, who had just come in, I think, from outside—

“ Q. That is his partner ?

“A. His partner — into, the office, and told him what had been said; and he says: ‘I have advised a writ of-attachment. What do you think of it?’ Mr. Keeney says, ‘I don’t see any other chance for him, or any other way for him to proceed.’ Mr. Butterfield says to him then to goon and draw up this writ;’ that he himself had to go, I think, to Lansing.

Q. Well, what was done?

“A. And Mr. Keeney did go on and draw up this paper, and the next day I went down there in the morning, and swore to it, and he called the sheriff over, and put the. papers in his hands to serve. ■

“ Q. I wbuld like to ask you why you consulted Butter-field & Keeney with regard to this matter.

“A. Well, I considered Mr. Butterfield, — I don’t know about Mr. Keeney, — but I considered Mr. Butterfield about as good authority as we had here, and I thought I wanted the best counsel I could get.

Q. Did you know anything about his character and standing as an attorney?

“A. I had always heard'him spoken of in the very highest terms.”

Mr. Butterfield, the attorney referred to by Mr. Perkins, was called as a witness, and testified to statements made by Mr. Perkins to him, and the advice he gave him, as follows:

“ Q. You may please proceed to state what the facts stated to yon by Mr. Perkins with reference to that claim against Mr. Le Clear were.

“A. I do not think, Mr. Sweet, I could give the language. I certainly would not undertake to after three years’ time. But in substance it was this: He said that Mr. Le Clear was indebted to him in a large amount; that he had been carrying him, and that he had made numerous promises; that he had great confidence in him, I think, and that he had just found out that he was hopelessly in debt, and that he was going to Detroit for the purpose of putting his property — entire property which he had — out of his hands. I think he mentioned the conveyance to his father, or some member of the family. My impression is he said something about some property which had already been transferred, but I could not identify that.

“ Q. I will ask you if Mr. Perkins said he knew that this was to be done, or stated that he had reason to believe it was to be done.

“ A. What he stated to me was that he had learned it from some source; it was a bookkeeper or clerk, or somebody, of Mr. Le Clear’s, from whom he said he had got his information. I could not identify the person, but he seemed to be very certain that his facts were true.

Cl Q. Upon that statement of facts on his part, what .did you advise, if anything?

“A. The commencement of an attachment suit.”

Dross-examined by Mr. Maher:

Q. Did Mr. Perkins tell you what the extent of Mr. Le Clear’s indebtedness was?

■“A. He may have done so, but my impression is he simply confined himself to the statement that he owed so much that he had no hope of paying.

“ Q. That he owed so much that he had no hope of paying?

“A. Yes; some general statement of that kind. He may have stated the amount, but I don’t know.

“ Q. And he stated to you that Mr. Le Clear was about to go to Detroit for the purpose of disposing of all his property?

“A. He said to me that he was informed by this (by the source of which I spoke to you) that he was about' going to Detroit to dispose— He either said all his prop■erty, or the gallery and the stuff up there, which was all he had.”

The court instructed the jury, substantially, that there were two questions of fact to be determined, in order to ascertain whether the plaintiff could maintain this action, viz., that the motive which the defendants in this suit had in commencing the attachment suit was malicious, and, second, that they caused it to be issued without probable cause for so doing; that, if the jury found that the attachment proceedings were commenced and prosecuted without probable cause, they were at liberty to infer malice; that, to constitute probable cause for the prosecution of attachment proceedings upon the claim that the debtor has done or is about to do some act or acts with intent to defraud his creditors, it is necessary that the person or persons instituting such proceedings should actually believe, and should also have good reason to believe, that the debtor has done or is about to do such act or acts with the fraudulent intent alleged against him; that mere belief that he has done or is about to do such fraudulent .act is not sufficient to justify an attachment; that the attachment will be unlawful and illegal unless the belief is founded upon knowledge, or what is believed to be reliable information, as to facts which,-if true, would justify the belief; that want of probable cause is an essential ground in this action, or one of the essential grounds; that other things may be inferred from this, but this cannot be inferred from anything else, — it must be established by positive and express proof; that the plaintiff had the right to deal with his property and dispose of it as he saw fit, .so long as he did not seek to dispose of it with an intent to defraud his creditors. After disposing of these questions in a very able, lucid, and correct charge, the court took up the question of advice of counsel, and directed the jury .as follows:

“There is another question for you to consider, which, in my opinion, bears both upon this question of malice- and upon the question of probable cause, and that is thequestioA of advice of counsel. And upon that question I charge you that advice of counsel can only be considered when the party seeking such advice has fully, fairly, and honestly stated all the facts and circumstances within his knowledge to the counsel of which he seeks advice. If the party seeking such advice, instead of fully and fairly stating the facts, stated as a matter of fact that which he did not know to be true, or had good reason to believe to be true, based upon the information which he possessed, and acting in good faith, then the advice of counsel would he-no protection. Neither would it be any protection if it were resorted to merely for the purpose of covering a previous intent to do wrong; but the advice of counsel, when sought, must be sought in good faith, and all of the-facts and circumstances within the knowledge of the party seeking it, and the information upon which he acts after receiving the advice of counsel, must be fully and fairly stated to the counsel in good faith, and the party seeking the advice must believe the facts and circumstances, as he-narrates them, to be true.

“Upon'this question of the advice of counsel, Judge-Cooley, in his work on Torts, under the head of c Malicious Prosecution/ at page 183, says:

‘“It may perhaps turn out that the complainant, instead of relying upon his own judgment, has taken the advice of counsel learned in the law, and acted upon that. This should be safer- and more reliable than his own judgment, not only because it is ‘the advice of one who can view the facts calmly and dispassionately, but because he is capable of judging of the facts in their legal bearings. A prudent man is therefore expected to take such advice, and when he does so, and places all the facts before his counsel, and acts upon his opinion, proof of the fact makes out a. case of probable cause, provided the disclosure appears to have been full and fair, and not to have withheld any of the material facts.’

“And the Supreme Court, in a case in Monroe county,, in 92 Mich., at page 75 [Perry v. Sulier], have said, that—

“ ‘ The person seeking and receiving such advice is in law as well, as in morals justified in acting upon it, provided that he fully- and fairly state the facts to the attorney.’

“And I charge you, gentlemen, that these extracts which I have just read state the law correctly, and you will apply that in your consideration of this case.”

The jury returned a verdict in favor of the defendants.

The main contention of plaintiff's counsel is that the court was in error in permitting defendants to show the advice of counsel, and in directing the jury that they might consider this advice in determining the questions of probable cause and malice, the claim being that this rule does not obtain in causes growing out of the commencement of civil actions.

No distinction exists between criminal and civil actions upon the question as to want of probable cause and malice. In Stewart v. Sonneborn, 98 U. S. 192, it was said:

“ It is abundantly settled that no suit can be maintained against an unsuccessful plaintiff or prosecutor unless it is shown affirmatively that he was actuated in his conduct by malice, or some improper or sinister motive. Malice is essential to the maintenance of any such action, and not merely (as the circuit court thought) to the recovery of exemplary damages. Notwithstanding what has been said in some decisions of a distinction between actions for criminal prosecutions and civil suits, both classes, at the present day, require substantially the same essentials. Certainly an action for instituting a civil suit requires not less for its maintenance than an action for a malicious prosecution of a criminal proceeding.”

In Williams v. Hunter, 3 Hawks (N. C.), 545, where an attachment had been issued, it was said by Chief Justice Taylor:

“ I cannot distinguish this case from an action for maliciously holding a party to bail, or suing out a writ when nothing is due, in which case the gist of the-action is malice and the want' of a probable cause.”

In the following cases the actions were brought for wrongful prosecution of civil actions, and they hold that the rule is the same in civil actions as in criminal prosecutions: O’Grady v. Julian, 34 Ala. 88; McCracken v. Bank, 4 Fed. Rep. 602; Brewer v. Jacobs, 22 Id. 222; Emerson v. Cochran, 111 Penn. St. 619; Sledge v. McLaren, 29 Ga. 64; Spengler v. Davy, 15 Grat. 381; Allen v. Codman, 139 Mass. 136; Live-Stock Co. v. Butchers’ Union, 120 U. S. 141. This same rule was applied in Brand v. Hinchman, 68 Mich. 601, — an action for maliciously suing out an attachment, — in which it was said:

' “ There is no doubt that, if the defendants honestly believed that they had probable cause, the mere fact that there was not in reality any probable cause would not render them liable. But it was for the jury to determine whether they honestly believed that they had probable cause, and they could only determine this by ascertaining what careful and prudent business men would have done under like circumstances."

But it is contended that the advice of counsel cannot protect a party in the prosecution of a civil action, and the fact that he relied upon the advice of counsel in suing but'an attachment is no evidence of want of malice, and cannot be used in determining the question of want of probable cause. Prof. Tiedeman, in bis note to Sharpe v. Johnstone, — a case from the Missouri supreme court, and reported in 21 Am. Law. Reg. (N. S.) 576, — says:

“It is remarkable with what uncertainty the books speak of the manner in "which the advice of counsel constitutes a defense. Some of the cases hold that it is proof of probable cause; some maintain that it disproves malice,* in most cases imposing no limitation upon its scope; while others — and, it is believed, the majority of the cases — refer, to it as establishing both the absence of malice and the presence of a probable cause."

In the present case the actual facts as to the purpose of Mr. Le Clear to dispose of his property with intent to defraud his creditors were in dispute. Just what Miss Sherman communicated to Mr. Perkins, and Mr. Perkins communicated to bis attorney, Mr. Butterfield, was not in dispute. Upon the proceedings to dissolve the attachment, it was incumbent upon the plaintiffs in the writ (Perkins & Richmond) to show actual cause for suing out the writ. It was obligatory upon them to show that the allegations in the affidavit were literally true. On the other hand, in the present suit for malicious prosecution of the writ, a complete defense is established by showing probable cause; or, in other words, the burden is upon the plaintiff in this suit (he who was the defendant in the writ of attachment) to establish both want of probable cause and malice, to make his case, though malice may be inferred from want of probable cause. It is generally stated in all cases upon this subject that malice and want of probable cause must coexist, to found an action for malicious prosecution, although malice need not be directly and affirmatively proved, but may be inferred from want of probable cause. Where the facts are undisputed, probable cause is a question of law, to be determined by the court upon the facts of the ease. Israel v. Brooks, 33 Ill. 575; Cloon v. Gerry, 13 Gray, 301. But if the facts are in dispute, so that the question of probable cause becomes a mixed one of law and fact, it must be given to the jury to determine, upon proper instruction from the court. Humphries v. Parker, 53 Me. 502; Heyne v. Blair, 63 N. Y. 19; Cole v. Curtis, 16 Minn. 182. In this State the rule has been adopted that where one places all the facts before his counsel, and acts upon his opinion, proof of the fact makes a case of probable cause, provided the disclosure appears to have been full and fair, and no material facts withheld. In support of the text in Cooley on Torts, recited in the circuit judge’s charge, the author cites Ravenga v. Mackintosh, 2 Barn. & C. 693; Stone v. Swift, 4 Pick. 389; Walter v. Sample, 25 Penn. St. 275, — and a long list of other cases. In the last case cited (Walter v. Sample), it was said:

“If a prosecutor has fairly submitted to his counsel all the facts that he knows are capable of proof, and has acted bona fide on the advice given, he negatives, if not the malice, the want of probable cause, and is not liable to an action for malicious prosecution, even though the facts did not clearly warrant the advice and prosecution.”

It is also held that advice of counsel may also disprove malice. In Stanton v. Hart, 27 Mich. 539, 542, Mr. Justice Campbell says:

“Every man of common information is presumed to know that it is not safe, in matters of importance, to trust to the legal opinions of any but recognized lawyers. * * * When a person resorts to the best means in his power for information, it will be such a proof of honesty as would disprove malice, and operate as a defense, proportionate to his diligence.”

In Perry v. Sulier, 92 Mich. 75, it was said:

“The person seeking and receiving such advice is in law as well as in morals justified in acting upon it, provided that he fully and fairly state the facts to the attorney.”

The following cases are in accord with our own decisions in which advice of counsel has been held to constitute either probable cause or absence of malice in the prosecution of civil proceedings. Brewer v. Jacobs, 22 Fed. Rep. 222; Emerson v. Cochran, 111 Penn. St. 619; Allen v. Codman, 139 Mass. 136; Lemay v. Williams, 32 Ark. 166.

It is contended that the • allowance of Miss Sherman’s testimony as to her knowledge of plaintiff’s business and financial affairs and his efforts to borrow money, and the inclusion of those elements in the charge to the jury, as part of what was claimed by the defendants to justify the attachment, was error. We think there was no error in this. The gist of the action is want of probable cause and malice, and whatever had a tendency to rebut malice and show probable cause was competent; and Miss Sherman's testimony was competent and admissible, as bearing upon both questions, and to enable the jury to say whether the ■defendants did more than “what careful and prudent business men would have done under like circumstances.” Brand v. Hinchman, 68 Mich. 601.

It is also claimed that the court erred in charging that both want of probable cause and malice must concur, to ■entitle the plaintiff to recover. This has already been discussed, and the doctrine is too well settled to need any further discussion, that the charge was correct. The authorities are uniform upon the subject, and sustain the charge as given. See the authorities collected in 14 Amer. & Eng. Enc. Law, p. 46 et seq.; also cases cited in note to Sharpe v. Johnstone, supra.

Some other errors are claimed, but after a careful examination of them, and the authorities bearing upon the subjects discussed in brief of plaintiff's counsel, we do not think them of sufficient importance to need discussion here.

Judgment is affirmed.

The other Justices concurred.-

       76 Mo. 660.