source: Caselaw Access Project

author: Stone, J.

license: Public Domain

text:
    CRAIG v. CROSSMAN.
    1. Vendor and Purchaser — Land Contracts — Assignments — Property Rights — Specific Performance.
    A contract in writing whereby the vendor of certain city lots agreed to deed same to the vendee, or any person she might designate in writing, within one year, upon payment of a stipulated sum with amount of taxes or other expenses added thereto, held, to create a valid property right in the vendee entitling her assignee to specific performance thereof.
    2. Same — Consideration Paid by Assignee.
    In proceedings against the vendor and his grantor by the assignee of said contract to specifically enforce the same, defendants cannot raise the question of consideration paid by said assignee.
    3. Same — Defeasance Executed After Making of Contract— Notice.
    A defeasance executed by the vendor to his grantor after the execution of the contract, which was never recorded, and of which plaintiff had no notice, could not affect his rights under said assignment, and its character is therefore unimportant.
    4. Same — Estoppel—Deeds*.
    Where vendor’s grantor was present and assisted in making said contract, he is estopped, as against the vendee and those succeeding to her rights, to deny that his deed was an absolute one, which on its face it purported to be.
    5. Estoppel — Acts of Owner.
    Where the owner of land stands by and knowingly permits his property to be mortgaged or sold by another, to one who is, to the owner’s knowledge, relying on the apparent ownership, of the person executing the conveyance, such conduct will estop the owner from asserting his title against the mortgagee or grantee.
    6. Vendor and Purchaser — Land Contracts — Assignments.

      Held, that said contract was assignable.
    On effect of defeasance against creditors of grantee of failure to record, see note in 5 L. R. A. (N. S.) 387.
    On the question of insurable interest of holder of option on property, see note in L. R. A. 1918A, 393.

      7. Witnesses — Matters Equaely Within Knowledge oe Deceased.
    Under 3 Comp. Laws 1915, § 12553, testimony of defendants as to a notice served by them upon the vendee (since deceased) attempting to terminate her rights in a land contract was incompetent as equally within the knowledge of the deceased.
    8. Same — “Opposite Party” — Assignments.
    An assignee of deceased, under the law, is not an “opposite ■ party,” but stands in deceased’s shoes.
    9. Vendor and Purchaser — Ownership oe Insurance Money.
    Upon payment of the full purchase price, plaintiff was entitled to receive the insurance money collected for damage by fire to a building on said lots, where the vendor had charged the premiums against the vendee.
    Appeal from Wayne; Shepherd (Frank), J., presiding.
    Submitted October 29, 1919.
    (Docket No. 60.)
    Decided April 10, 1920.
    Bill by L'avina B. Donaldson, substituted for Donaldson Craig, against John M. Crossman and another for the specific performance of a land contract, and for an accounting. From a decree for plaintiff, defendants appeal.
    Affirmed.

      Henry B. Graves, for plaintiff.

      James H. Pound, for defendants.
   Stone, J.

The bill of complaint herein was filed to obtain specific performance of a written agreement by the defendant Crossman to convey to Maria Macdonald three lots in Highland Park, Wayne county, known as lots 1, 2 and 3 of H. R. Blackwood’s subdivision of outlot 1 of Yeaman’s addition to Highland Park village in quarter sections 15 and 26 of the 10,000-acre tract. The defendant Campbell was made a defendant to bar claims of ownership made by him of the lots in question. Maria Macdonald subsequently transferred her rights to the plaintiff.

The following statement of facts is compiled from plaintiff’s brief:

The lots were purchased by defendant Campbell in 1902, and he sold them on land contract to Maria Macdonald in 1906. She commenced the erection on' the lots of a store building and house, and therein became indebted to George W. Ross and the Michigan Lumber Company for material used in the construction of the buildings, which were not entirely completed in the first place. This indebtedness she was unable to pay, and she was also delinquent in her payments on the land contract. In 1908 a settlement was. made by Campbell deeding the lots to George W. Ross, who borrowed thereon for the use of himself and Campbell from the Capitol Savings & Loan Association $3,200 secured by mortgage. Defendant Cross-man, who had advanced money to Campbell, obtained a second mortgage on the property. The old land contract to Maria Macdonald was surrendered by her, and a new land contract, dated March 3, 1908, was given her by George W. Ross. Ross also gave defendant Campbell a written statement that he would transfer the property back to Campbell, when the latter took care of the first mortgage on the property. Maria Macdonald continued in possession of the property. In the spring of 1912 Maria Macdonald was again delinquent in her payments on her land contract, and Ross, who had completed the buildings, insisted on being paid and relieved of the mortgage to the Capitol Savings & Loan Association. Defendant Campbell applied to CrosSman for further assistance, which was granted, and the following things were done:

Crossman advanced $5,000, and with this money the mortgages on the lots were discharged and Ross was paid. The latter thereupon deeded the lots to Campbell and Campbell deeded the lots to Crossman, and certain insurance policies on the buildings were assigned to Crossman. These discharges and deeds were all recorded on April 27,1912, although the deeds bear date April 9, 1912.

The land contract to Maria Macdonald was assigned by Ross to Crossman. Thereupon Crossman and Maria Macdonald made a new agreement relating to the lots, which reads as follows:

“This contract, made this third day of April, A. D. 1912, by and between John M. Crossman, of Detroit, Michigan, party of the first part, and Maria Macdonald, of Highland Park, Michigan, party of the second part,
“Witnesseth, that the said party of the first part in consideration of the assignment to said party of the first part, of any and all rights of said party of the second part, and a certain land contract made between said party of the second part, and George W. Ross, of Detroit, Michigan, on the third day of March, A. D. 1908, in which contract the said second party is in default and arrears, does hereby agree that he shall and will at any time within one year from the date hereof, at the written request of the said party of the second part, her heirs, executors or administrators, execute and deliver to said party of the second part, her heirs, executors or administrators or to any person or persons the said party of the second part, her heirs, executors or administrators may direct in writing, a good and sufficient warranty deed, except as to acts committed by said Maria Macdonald on or after March 3,1908, and an abstract showing good marketable title of the following described land, situated in Highland Park, county of Wayne, State of Michigan, to-wit:
“Lots one (1), two (2), three (3), of H. R. Black-wood’s subdivision of outlot one (1) of Yeaman’s addition to Highland Park village, subdivision of quarter sections fifteen (15) and twenty-six (26) town one • (1) south of range eleven (11) east, ten thousand acre tract.
“For the sum of fifty-two hundred sixty-one dollars ($5,261), together with interest from the date of this contract at six per cent, per annum.
“It is agreed by and between the parties hereto that any and all rents or other income derived from the aforesaid premises by the party of the first part, or his legal representatives while this instrument is in force, are to be first applied as payment on charges against said property — taxes.
“It is further agreed by and between the parties hereto, that all taxes, special or general, assessed against the aforesaid premises, and all other expenses of any kind or nature necessarily incurred for the preservation, improvement of said property during the life of this instrument, and not met by the income therefrom, and paid by said party of the first part, are to be added to the aforesaid purchase price of $5,261, and to bear interest at six per cent, from time of payment of same.
“Said party of the first part hereby expressly reserves the right to grant an easement for sewer purposes to the village of Highland Park, subject to the condition that when said sewer is replaced or disused the easement shall become null and void.
“It is agreed by and between the parties Hereto that if the said party of the second part, her heirs, executors or administrators at the expiration of the aforesaid limited time, shall not have taken up this option, said option shall be null and void, and the consideration given as aforesaid shall be forfeited by the said party of the second part, and the said party of the first part shall have the right to retain the same as and for ■ liquidated damages, and.the said party of the second part shall and does hereby, expressly relinquish to said party of the first part all claim to said land, either in law or equity, and no. claim of said party of the second part under this instrument shall be effectual in law or equity; it being expressly understood and agreed that time is the essence of this option.
WCC S J W
“It is further agreed that any and all improvements that the said party of the first part deems it necessary to make to protect or advance his interest' in said property shall be charged against said property, and-ten per cent. added for time-and labor spent in superintend"
“All charges of any kind and nature paid by the party of the first part on behalf of the said property are to be added to the first above mentioned amount of $5,261, and the sum total of said amounts must be paid in good and lawful money of the United States, on or before April 3, 1913.
“On and after thé 6th day of May, 1912, all payments as rental derived from said property (stores) are to be paid to the said J. M. Crossman, and said Maria Macdonald or her tenants are to pay $10 per month monthly for the dwelling part of said property.
“In witness whereof, the said parties of the first arid second parts have hereunto set their hands and seals the day and year first above written.
(Signed) “John M. Crossman. [Seal.]
(Signed) “Maria Macdonald. [Seal.]
“In,-presence of
(Signed) “Seth J. Wicker.”
“State op Michigan,
“County of Wayne,
ss.
, “On this 23rd day of April, A. D. 1912, before me, the subscriber, a notary public in and for said county, personally appeared John M. Crossman and Maria Macdonald, to me known to be the persons described in and who executed the foregoing instrument, as vendor and vendee, and acknowledged the same to be their free act and deed.
(Signed) “Seth J. Wicker,
“Notary public, Wayne county, Michigan.
“My commission expires Jan. 25th, 1915.”

Maria Macdonald thereupon surrendered all of her rights under the old land contract and continued in possession under this new agreement. It is the claim of plaintiff that defendant Campbell, who is a lawyer, participated in drawing this new agreement between Crossman and Maria Macdonald, and placed his initials on the margin to verify certain pen alterations in the original draft, which initials have been omitted in the printed record, but are reproduced in the copy of contract set forth in plaintiff’s brief, there being testimony upon the subject.

Later, on April 25, 1912, Crossman gave to Campbell a paper as follows:

“Defeasance.
“April 25th, 1912.
“476 Lincoln Ave., Detroit, Mich.
“This contract shall expire on or before five years, while it shall be binding upon my heirs or assigns, administrators and. executors.
“Lots one to fifteen, from Hamilton boulevard, west on Glendale avenue, H. R. Blackwood’s subdivision out-lot of Yeaman’s addition to Highland Park, on quarter sections fifteen and twenty-six, 10,000-acre tract were deeded to me by W. C. Campbell. It is only in trust, and when W. C. Campbell shall have paid me the sum I have advanced on them, and also on the twelve family terrace on west side of Riopelle, and south side of Kirby avenue, $13,000 with interest at 6 per cent, per annum from April 25th, 1912, and other expenses it is necessary for me to pay I will then deed the property to him or his assigns. He may pay $500 or more at any time.
“J. M. Crossman.
“Witness:
“Mary Crossman.”

The original of this paper Campbell was unable to produce at the hearing below, but he produced a copy which was received in evidence. It is dated 16 days after the deed from Campbell to Crossman was made. This paper was never recorded in the office of the register of deeds. As has been .stated, the deed to which it refers was recorded in the office of the register of deeds as a deed, April 27, 1912.

Maria Macdonald, had a son, Daniel Macdonald, who was married, and also lived on the property. He was a builder and had done considerable building for plaintiff, which finally resulted in Daniel Macdonald becoming indebted to plaintiff in the sum of $2,531.28. .To settle this indebtedness, the rights which Maria Macdonald had obtained in the lots in question were transferred to the plaintiff, and this transfer was evidenced by the delivery to plaintiff of the Crossman-Macdonald contract dated April 3, 1912, but signed and acknowledged April 23, 1912, and the execution of an agreement between the plaintiff, Maria Macdonald, and Daniel Macdonald, dated November 20, 1912, which was as follows:

“Whereas, Donaldson Craig and Daniel Macdonald have come to an accounting regarding the building by the said Macdonald of ten houses on Sturdevant avenue in the village of Highland Park, and other matters, the result of which accounting is as follows. The debit items against said Craig on said accounting were the following:
Amount due said Macdonald on various houses----$9,446.65
Amount due Macdonald from Craig on commissions. 157.50
Total amount due from Craig to Macdonald......$9,604.15

“The debit items against said Macdonald on said accounting were as follows:

-Payments heretofore made by said Craig to said
Macdonald .....................................$9,363.63
Unpaid bills owing by Macdonald to various persons, chiefly for materials used by said Macdonald in building said houses, which hills the said Craig agrees to pay................................... 2,771.80
Total charges against Macdonald...............$12,135.43
Balance due from Macdonald to Craig as the result of the accounting................................2,531.28
“Now, therefore, in full payment to the said Craig of the said balance of two thousand five hundred and thirty-one 28/100 dollars ($2,531.28) so as aforesaid owing to him by the said Daniel Macdonald, Maria Macdonald hereby sells, assigns, transfers and sets over and conveys to the said Donaldson Craig all of her interests and rights existing by virtue of an instrument dated April 3, 1912, wherein John M. Cross-man, of Detroit, Michigan, is party of the first part, and the said Maria Macdonald, of Highland Park, Michigan, is party of the second part. And the said Maria Macdonald hereby also conveys to the said Donaldson Craig all her interests in the land described in the said instrument existing by virtue thereof. The said Daniel Macdonald and Donaldson Craig hereby agree to the accounting hereinbefore recited.
“In witness whereof the said Donaldson Craig and Daniel Macdonald, and Maria Macdonald have hereunto set their hands and seals this 20th day of November, 1912.
“Maria Macdonald. [Seal.]
“D. Macdonald. [Seal.]
“Donaldson Craig. [Seal.]”

Before plaintiff made the foregoing agreement he took the precaution to do the following things:

He had the abstract of the lots extended and certified to date, and examined by his attorney. He obtained, through his attorney, a statement in writing from Crossman signed by him, as to the amount then owing by Maria Macdonald on the lots. He told Cross-man he was about to acquire the interest of Maria Macdonald in the lots, and discussed the question of insurance on the buildings. At no time prior to the making and delivery of the agreement between plaintiff and the Macdonalds did either Crossman or Campbell tell plaintiff, either directly or indirectly, that Campbell had any interest in the lots.

When plaintiff procured the interest of Maria Macdonald in the lots there were two fire insurance policies on the buildings in the sum of $1,600 each, which were renewals of policies which Ross had transferred into Crossman’s name at the time the lots were deeded to the latter. It is claimed that Crossman told Craig some time later that the property was worth more than $8,200, and accordingly plaintiff took out in his own name another policy in the American Insurance Co. of Newark, N. J., in the sum of $1,000, with the loss payable first to Crossman, and next to himself.

On January 18, 1913, plaintiff left for the West Indies and did not return to Detroit until the next March. Soon after the plaintiff left Campbell sent to plaintiff’s office a letter as follows:

“Insurance, Loans.
Exchanges, Contracts.
“Phone Main 4256.
“Campbell, Peters & Greig.
“Real Estate, 74 Home Bank Building.
“Detroit, Mich., Jan. 20, 1913.
“Craig Real Estate Exchange,
“Mr. Generoux.
“My dear Sir:
“Mr. J. M. Crossman notified me, a few days ago that he had a conversation with some member of your office, presumably yourself, in regard to a certain option given Mrs. Maria Macdonald, during April, 1913. In fairness to you, I desire to notify you that said option was not assignable, and such assignment would not be honored by the owners. Mr. Crossman, as you are aware, is a mortgagee only, the title being held elsewhere. Trusting that you are not suffering in this deal as I have been, I remain
“Yours truly,
“W. C. Campbell.
“P. S. A notice of default was served on Mrs. Macdonald December 26th, 1912.
“Yours, etc.,
“W. C. C.”

This, letter was handed to Mr. Hatch, plaintiff’s attorney, who saw Crossman, it is claimed, on January 21, 1913, and asked him about Campbell’s claims. He replied that the conveyance to him on April 9, 1912, was an absolute conveyance, without any understanding,, oral or otherwise, to the contrary; but that subsequently he had a talk with Campbell, and gave the latter a paper to the effect that, if the property was sold within five years, Campbell could have the surplus after he (Crossman) was repaid all he had invested in the property. While plaintiff was gone, and while Maria Macdonald was still living in the building on the lots, as claimed by plaintiff, a fire occurred about January 29, 1913, which badly damaged the buildings, and made them untenantable. While plaintiff was absent Mr. Hatch represented him in legal matters, and he took appropriate steps to notify the insurance companies of the loss, as soon as he learned of the fire.

Upon plaintiff’s return, a letter addressed to Cross-man was prepared by Mr. Hatch, and signed by plaintiff, and delivered to Crossman, in which letter plaintiff gave notice that he proposed to tender to Cross-man the proper amount, and obtain a deed of the lots, pursuant to the contract of April 3, 1912, with Maria Macdonald. This letter was dated March 26, 1913, and went into, with much detail, the amount to be tendered, basing the computation on the statement submitted by Crossman to plaintiff the previous November. It also submitted the form of deed to be made, and requested an assignment to plaintiff of three insurance policies, and also requested an interview for the purpose of making the tender prior to April 3, 1913, when the time for executing the option to purchase expired.

As a result of this letter and subsequent discussions, a final interview was had between the plaintiff, Crossman, Campbell and Hatch on April 3,1913, which resulted in a tender by Hatch on behalf of the plaintiff to Crossman of the sum of $5,726.08 and the” demand of a deed and assignment of the three insurance policies. The tender was refused. The reasons for the refusal were that Crossman did not think enough money was tendered, and that he would not, under any circumstances, transfer the two oldest insurance policies, but would transfer the policy taken out by the plaintiff. At the same time Crossman stated that he did not think he had the right to deed the property against the protests of Campbell, and did not intend to recognize any right at all in plaintiff to demand a deed.

Crossman, however, submitted a statement of the amount which he claimed was due under the Macdonald contract totaling $6,036. Wherein this statement differed from the plaintiff’s computation is pointed out in the briefs and record, but is too lengthy to warrant insertion here. It consisted of numerous small sums. After this tender was made and refused, the bill of complaint herein was filed on April 5, 1913.

Pending the hearing Maria Macdonald died, and Daniel Macdonald could not be found at the time of the hearing.

Before the hearing an adjustment of the loss>upon the two oldest insurance policies was had, and Cross-man received $1,744 therefrom. Suit was brought on the policy issued by the American Insurance Co. to the plaintiff, which was pending when the instant case was heard below, but recovery has since been had, and affirmed by this court on writ of error. See Crossman v. Insurance Co., 198 Mich. 304 (L. R. A. 1918A, 390).

Some other claimed facts, which were either controverted by opposing testimony, or alone supported by testimony claimed to be incompetent, should perhaps be stated.

It was claimed by defendants that at the time the contract of April 3, 1912, was made between Cross-man and Maria Macdonald, there was an oral agreement by Maria Macdonald to pay $50 a month rent, in addition to the $10 rent specified in the agreement. This testimony was objected to by plaintiff, because it was equally within the knowledge of Maria Macdonald, who was the assignor of plaintiff, and was deceased, and thereby incompetent, under the statute; and also because it tended to vary the provisions of the written contract, which covered the question of rent. It was claimed by plaintiff that soon after he acquired the interest of Maria Macdonald in the lots, he inquired of Crossman regarding the insurance, to see whether he was amply protected, and was told by Crossman regarding the policies on the building, and that they would inure to his benefit and protection. This claim was supported by the testimony of the plaintiff and that of another witness. Crossman testified that there was talk about the insurance, and that he told plaintiff about the policies he had, and that the property would stand more. While Cross-man does not directly deny the testimony of plaintiff, as to the existing policies inuring to the plaintiff’s benefit, his. testimony may be subject to that construction. It was claimed by defendants that for nonpayment of- rent they terminated Maria Macdonald’s rights in the property under the contract, by the service upon her of some sort of notice on December 26, 1912. A copy of the notice does not appear in the record, and the substance of it is not given. This testimony was objected to, because equally within the knowledge of Maria Macdonald, plaintiff’s assignor, who was deceased. It was also claimed by defendants that a partnership composed of defendant Campbell, one Peters, and one Greig was occupying the building on the lots as a real estate office, at the same time that the Macdonalds were living in the building, at the end of November, 1912, when plaintiff purchased from Maria Macdonald. This claim was supported by the testimony of Campbell, who claimed that it was occupied from the middle of September, 1912, to the middle of January, 1913. But Greig, one of the firm, testified that the building was used only as a branch office from the latter part of August for two or three months, and that they left before it got very cold. This occupancy seems to have been a fugitive, uncertain one.

It was also claimed by defendants that some time after plaintiff claimed to have the lots for sale, a Mr. Generoux (who at the time was working as a real estate salesman on commission for plaintiff) saw Campbell on the premises and was informed by the latter that he (Campbell) owned the lots; and that later Generoux told plaintiff what Campbell had said. This appears to have been after the plaintiff had listed the property, and there is no claim that he had anything to do with the property until the assignment of the contract on November 20, 1912. We fail to see the importance of this evidence as to what occurred after plaintiff’s rights had become fixed, if he had any.

It was claimed by plaintiff that on April 1, 1913, Maria Macdonald signed a paper addressed to Cross-man, requesting the latter to deed the lots to plaintiff, and also to assign the insurance policies to him. This paper was prepared by Mr. Hatch, who gave it to Da,niel Macdonald to be signed. The authenticity of the signature of Maria Macdonald to the paper is denied by defendant Campbell on the ground that the handwriting is not that of Mrs. Macdonald, and because there is the prefix “Mrs.” before the name. The authenticity of the signature is affirmed by Mr. Hatch because of another paper signed by Mafia Macdonald on April 23, 1913. The disputed paper was produced at the argument for our inspection. While agreeing with the learned circuit judge that this paper is of no great importance, yet we see no reason to doubt that Mrs. Macdonald signed it. Plaintiff claimed at the hearing that this paper was presented at the time of the tender. Mr. Hatch so testified. The defendants testified that they never saw the paper until the hearing.

On the argument in the court below, the following claims were made by the respective parties:

(1) The plaintiff claimed that Maria Macdonald possessed at the time she made the contract with plaintiff, November 20, 1912, a valid property right to have conveyed to her, or to any one whom she would nominate, the lots in question, at any time on or before April 3, 1913, upon payment of the sum named in the contract of April 3, 1912, with interest at 6 per cent, and such additional sums as the contract provided for future taxes, assessments, charges or rents, with interest. ' ' •

(2) That the deed from Campbell to Crossman is not a mortgage; and the latter so-called defeasance is not a defeasance, but simply an agreement to reconvey, which was never recorded.

(3) That Campbell was estopped, by his conduct in participating in the drawing and making of the contract in question, from denying the validity of 'the contract, or any right on his part superior thereto, which might prevent the fulfillment of the contract.

(4) That the rights of Maria Macdonald, under the contract, were transferred to plaintiff, for a valuable consideration.

(5) That plaintiff became a "bona fide holder of the rights of Maria Macdonald, without knowledge, direct or constructive, of any rights of Campbell, even if the latter’s rights were superior to those of Maria Macdonald; and that Campbell by his conduct is es-topped to set up his prior rights against those of plaintiff.

(6) That the rights of Maria Macdonald, and those of plaintiff were never terminated in any valid manner.

(7) That a direct request signed by Maria Macdonald, that the lots be deeded to plaintiff, was presented to Crossman; but even if this were not so, the contract between Maria Macdonald and plaintiff, amounted, legally, to such request, and to the nomination by Maria Macdonald, of plaintiff, as the person to receive the deed of the property.

(8) That a tender of the proper amount, within the proper time, was made to Crossman in behalf of plaintiff. (The language of the contract was “on or before April 3, 1913.”)

(9) That plaintiff was entitled, under the terms of the contract upon payment of the full purchase price, to have assigned to him all of the insurance policies.

(10) That Crossman was estopped by his conduct in notifying plaintiff that he had charged Maria Macdonald with the premiums on the two oldest policies, and in stating that such policies inured to plaintiff’s benefit, to take the opposite position, after plaintiff had effected only $1,000 additional insurance, and a fire loss had occurred.

The defendants made the following claims:

(1) That the deed from Campbell to Crossman was only a mortgage.

(2) That the contract of April 3, 1912, between Crossman' and Maria Macdonald was invalid, so far as Campbell was concerned, because Crossman could not convey without Campbell’s consent, which was withheld; and Maria Macdonald had notice of the situation.

(3) That the contract of April 3, 1912, between Crossman and Maria Macdonald was not assignable by the latter.

(4) That there was no consideration for the assignment by Maria Macdonald to plaintiff of the contract.

(5) That no nomination was ever made by Maria Macdonald of plaintiff as the person to whom conveyance was to be made.

(6) That plaintiff had notice of the rights of Campbell in the lots before he contracted with Maria Macdonald.

(7) All rights of Maria Macdonald, if she had any, in the property, were terminated by the notice served upon her on December 26, 1912.

(8) That no sufficient amount was tendered by plaintiff; and that additional rent of $280 was due under an oral agreement to pay $50 per month, additional rent by Maria Macdonald.

(9) That the two oldest insurance policies were the individual property of Crossman, and not affected or covered by the contract of April 3, 1912, between Maria Macdonald and himself.

The learned circuit judge found from the evidence that the rights and equities of the plaintiff were superior to those of defendant Campbell, or those of defendant Crossman. He filed a lengthy written opinion, which appears in the record and to which attention is called. He found that there was a good consideration for the transfer of the contract of April 3, 1912, from Maria Macdonald to plaintiff, and that this transfer was in effect the designation of plaintiff to receive the deed, irrespective of the disputed question of fact regarding the formal designation of plaintiff. He also found for the plaintiff, as to his right to have the insurance money; and against defendant Cross-man as to his claim of an oral agreement by Maria Macdonald to pay $50 a month more rent; against defendant Campbell as to his claim of right being superior to plaintiff; and against both defendants as to their claim of the termination, of the contract by notice. A decree was entered requiring defendant Crossman to execute and deliver a deed to plaintiff upon payment of the proper sum, including any money paid for taxes or repairs, or expenses in the insurance litigation, with the power reserved in the circuit court to make future directions, in case the parties could not agree as to the amount paid for such taxes, repairs or expenses. The decree is too lengthy to be here set forth in full. We quote portions of it as follows:

“It * * * does hereby consider, order, adjudge and decree that the plaintiff Donaldson Craig is legally and equitably entitled to have conveyed to him by the defendant John M. Crossman free and clear from all liens, interests or titles of the defendant William C. Campbell the land hereinafter described, and to have assigned to him all the right, title and interest of the defendant John M. Crossman in and to a certain cause of action now the subject of litigation in the circuit court for the county of Wayne. * * * in a suit entitled John M. Crossman, plaintiff, v. American Insurance Company of Newark, New Jersey, etc.
“The plaintiff is to be credited and the defendants are to be debited with the following sums: * * * Proceeds realized by the defendant John M. Crossman, from the two policies of insurance on the buildings on the property, issued by the St. Paul Fire & Marine Insurance Company, and the London Assurance Corporation $1,744, less the costs of arbitration incidental to the collection thereof.”

From this decree the defendants have appealed. In this court their counsel has argued with great persistency that upon this record the plaintiff has no claim upon this property superior to the rights of the defendants, and that their respective equities should be preserved to them; that, in fact, plaintiff has no interest whatever in the property; that neither defendant has ever recognized him as having any interest therein; that the evidence shows that Maria Macdonald had no interest in the same that had not been cut off by a forfeiture; that plaintiff paid Maria Macdonald no consideration for the claimed assignment; that the payment of a worthless debt of an impecunious son was no consideration; that plaintiff’s actions, viewed from every point, were characterized by overreaching craft and fraud, and that the decree should be reversed and the bill dismissed.

We have read this lengthy and somewhat confusing record with great care, and because of the persistency of defendants’ counsel, have endeavored to follow and understand his arguments. We are unable to agree with his conclusions. In our opinion the trial court reached the correct conclusion under the evidence in holding that the rights and equities of the plaintiff are superior to those of either defendant, and that plaintiff is entitled to specific performance of the contractof „April 3, 1912. ...That contract created a valid property right in Maria Macdonald. The question of consideration as between Maria Macdonald and the plaintiff cannot be raised by defendants. She might have given the contract to the plaintiff. Neither her heirs nor her creditors are here complaining. Reed v. Bond, 96 Mich. 134.

The character of the so-called defeasance is not important. It was never recorded and plaintiff had no notice of it.

Defendant Campbell is a lawyer, and was present and participated in the drawing of thé contract of April 3, 1912. He initialed a change in the contract. He should be held to be estopped to deny, as against Maria Macdonald and those succeeding to her rights, that his deed to Crossman was an absolute deed. Ueck v. Meatz, 192 Mich. 439, and cases cited.

The legal title was in Crossman when the contract of date April 3, 1912, was signed and acknowledged on April 23, 1912. It has been held in many cases that if the owner of land knowingly stands by and permits his property to be mortgaged or sold by another, to one who is to the owner’s knowledge relying on the apparent ownership of the person executing the conveyance, such conduct will estop the owner from asserting his title against the mortgagee or grantee. 10 R. C. L. pp. 780, 781, and cases cited.

We have no doubt that the contract was assignable. A lease with option to purchase is, by nature, assignable. Gustin v. School District, 94 Mich. 502; 5 Corpus Juris, pp. 1311, 1312, and cases cited.

It is urged by defendants-’ counsel that the rights of Maria Macdonald, and those of the plaintiff, under her (if he had any), were terminated by some sort of a notice served upon her by defendant Campbell on December 26, 1912. The contents of this- notice do not appear in the record. There was no competent testimony that any such notice- was ever served. The only testimony was from the defendants, and it was objected to because plaintiff is the assignee of Maria Macdonald, who is deceased. Judicature act, chap. 17, § 65 (3 Comp. Laws 1915, § 12553); Shepard v. Shepard, 164 Mich. 183, 196; Ripley v. Seligman, 88 Mich. 177.

Defendants’ counsel urge that this rule should apply to the plaintiff. We think not. As to him, Maria Macdonald was not an “opposite party.” He stood in her shoes. We are of the opinion that the plaintiff was entitled, under the terms of the contract, upon payment of the full purchase price, to the benefit of the insurance; the premiums had been charged to Maria Macdonald in Crossman’s statement, and he is in no position to dispute such claim of the plaintiff. The decree below, which gives the insurance* money to the plaintiff is, we think, correct.

We have examined the other questions presented, and think they were properly disposed of by the court below, and shall not discuss them.

The decree of the circuit court is affirmed, with costs to the plaintiff.

Moore, C. J., and-Steers, Bird, and Sharpe, JJ., concurred with Stone, J. Fellows, J., concurred in the result. Brooke, J., did not sit.

Justice KuhN took no part in this decision.


author: Moore, C. J.

text:
    WEISS v. STEIN.
    Replevin — Election of Remedies — Estoppel.
    Where defendant caused a writ of attachment to issue against two car loads of potatoes, recognizing ownership in another, he is estopped, in replevin proceedings to recover same, from asserting ownership in himself.
    Error to Wayne; Collingwood (Charles B.), J., presiding.
    Submitted October 22,1919.
    (Docket No. 3.)
    Decided April 10, 1920.
    Rehearing denied June 17, 1920.
    Replevin by Joe Weiss against. Edward F. Stein, sheriff of Wayne county, for the possession of certain potatoes. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Guy A. Miller, for appellant.

      Thomas W. Payne (George W. Coomer, of counsel), for appellee.
   Moore, C. J.

This is a case in replevin. From a verdict and judgment in favor of the plaintiff the case is brought here by writ of error. During the early part of the year 1917 Thomas Pierce was buying potatoes in Canada, which were brought to Michigan. He made an arrangement with Abraham Goldsmith, of Detroit, to buy some potatoes for him. He bought and delivered to him, at intervals, fifteen or more cars of potatoes. Trouble arose between them because of a sharp disagreement as to what the contract between them was.

It is the claim of Mr. Pierce that he stopped buying for Mr. Goldsmith, and that in March, 1917, he bought on his own account six cars of potatoes, which were billed to Windsor, and the bills of lading with drafts attached were sent to a bank in Windsor. It is his further claim that he sold one car load of the potatoes to Mr. Cohen, one to Mr. Miller and two cars to Mr. Goldsmith. These potatoes are not involved in the present litigation unless it may be incidentally.

It is the further claim of Mr. Pierce, and of the plaintiff as well, that he sold two cars of the potatoes to Joe Weiss, the plaintiff in the instant case, add was paid in full for them; that he delivered all four bills of lading to one Harris, a customs broker, to have them released from the customs, and for conveyance to Detroit, two cars to be delivered to Mr. Goldsmith and two of them to Mr. Weiss. When the cars arrived in Detroit Mr! Goldsmith took possession of the two cars purchased by him. He also made an affidavit in attachment wherein he claimed Mr. Pierce was owing him $2,300, and caused a writ of attachment to issue, which he delivered to the sheriff, who' by Mr. Goldsmith’s direction levied upon the two car loads Mr. Pierce and the plaintiff claim had been sold to Mr. Weiss. Thereupon Mr. Weiss sued out a writ of replevin for the possession of the two cars of potatoes which had been attached by the sheriff. A declaration in the usual form in replevin was filed in the replevin case to which the sheriff, the defendant, pleaded the general issue! The sheriff took no part in the trial, but Mr. Goldsmith, though his name did not appear in any of the pleadings in the replevin case, assumed the active defense in that ease. Instead of defending by. virtue of the attachment proceedings, he took the position that he bought from and paid Mr. Pierce for the potatoes before the attachment proceeding was begun.

Early in the trial of the case the plaintiff introduced the files in the attachment case in evidence and asked the court to rule that Mr. Goldsmith could not now defend in the replevin ease upon the theory that he was the owner of the potatoes because he had elected to sue Mr. Pierce for a money judgment and caused the sheriff to attach the potatoes as the property of Mr. Pierce. The trial judge declined to so rule and a hearing upon the merits was had upon the testimony of Mr. Weiss, Mr. Pierce, Mr. Cooney, and Mrs. Weiss, witnesses on the part of the plaintiff, and Mr. Goldsmith, Mrs. Goldsmith, the wife of Mr. Goldsmith, his daughter Miss Goldsmith, and Mr. Harris. Many exhibits were also introduced in evidence. At the close of all the testimony the attorneys for the plaintiff renewed their motion for a directed verdict. The attorney for the defendant also asked for a directed verdict. The court overruled both motions and gave a general charge to the jury in which he stated to them “the issue, after all the testimony has been taken and considered by you, is just that one question, Who owned these potatoes?”

We have already stated the result of the verdict. A motion was made by the defendant for a new trial for various reasons; this was overruled. The appellant has upwards of 20 assignments of error which are ably discussed at length. In our view of the case it will not be necessary to discuss these assignments in this opinion. We have already seen that the sheriff came into the possession of these potatoes by reason of a writ of attachment sued out by Mr. Goldsmith against Thomas Pierce, the levy being made upon the claim by Mr. Goldsmith that the potatoes were the property of Thomas Pierce.

In 9 R. C. L. at p. 968, it is said:

“Attachment or Garnishment and Other Remedy. Under the general rule that a party cannot take the inconsistent positions of suing upon a contract and treating it as rescinded, the bringing of an attachment in an action to recover for breach of a contract is an election which will bar a subsequent action to disaffirm the contract. And so by suing out an attachment on goods a creditor elects not to accept under a chattel mortgage conveying such goods to trustees for the benefit of certain creditors including himself. Likewise bringing suit in assumpsit for the value of property converted by the defendant, and attaching it as his property, whereupon the defendant gives bond and recovers the property, and sells it and receives payment, estops the plaintiff from asserting title against the vendee ánd suing the latter for conversion; and this is the rule though the first action fails for a defect in jurisdiction.”

In 10 R. C. L. p. 698, it is said:

“The rule that a party will not be allowed to maintain inconsistent positions in judicial proceedings is not strictly one of estoppel, partaking rather of positive rules of procedure based on manifest justice and, to a greater or less degree, on considerations of the orderliness, regularity, and expedition of litigation.”

At page 702 of the same authority it is said:

“It may be laid down as a general rule that a party will not be allowed in a subsequent judicial proceeding to take a position in conflict with a position taken, by him in a former judicial proceeding, where the later position is to the prejudice of the adverse party, and the parties and the questions involved are the same.”

At page 703 of the same authority it is said:

“Election of Remedies as Estoppel. Election of remedies is closely akin to the estoppels now under consideration, sometimes being termed a quasi estoppel. Thus, it is a general rule that if one having a right to pursue one of the several inconsistent remedies, makes his election, institutes suit, and prosecutes it to final judgment or receives anything of value tinder the claim thus asserted, or if the other party has been affected adversely, such election constitutes an estoppel thereafter to pursue another and inconsistent remedy. And where the right in the subsequent suit is inconsistent with that set up in the former suit, as distinguished from a merely inconsistent remedy, the party is estopped though the former suit may not have proceeded to judgment.”

See, also, Thomas v. Watt, 104 Mich. 201, and Cooper v. Smith, 109 Mich. 458, where the principle involved here was considered.

This record shows beyond any reasonable doubt that Mr. Weiss negotiated for these potatoes and paid to Mr. Pierce upwards of $3,000 for them, expecting them to be delivered to him on the railroad track in Detroit. While they were on that track Mr. Goldsmith caused them to be attached as the property of Mr. Pierce. While they were in the possession of the sheriff, by virtue of the writ of attachment, this replevin case was commenced. It is not until more than a year later, so far as this record shows, that Mr. Weiss is advised that Mr. Goldsmith has shifted his position from the claim made in the attachment proceeding that the potatoes belonged to Mr. Pierce, to the new position that at the very time Mr. Goldsmith instituted the attachment. proceeding he was in fact the owner of the potatoes. In the meantime Mr. Weiss lost the opportunity which was then open to him to say at once, if advised of the facts, to Mr. Pierce:

“You sold me two car loads of potatoes for which I paid you more than three thousand dollars. Mr. Goldsmith says-you sold him the potatoes and I want you either to put me in the possession of the potatoes or hand me back my money.”

We think, under the law properly applied to the facts in this case, there should have been a directed verdict in favor of the plaintiff. It will not be necessary to discuss the various assignments of error.

The judgment is affirmed, with costs to the plaintiff.

Steere, Brooke, Fellows, Stone, Bird, and Sharpe, JJ.,. concurred.

Justice Kuhn took no part in this decision.


text:
    BOARD OF SUPERVISORS OF BAY COUNTY v. CORLISS. SAME v. SAME. SAME v. MORTON.
    1. Counties — County Treasurer — Bonds—Interest on State Moneys — Public Moneys — Liability of Treasurer.
    Under 1 Comp. Laws 1915, § 298 ei seq., providing that all moneys coming into the hands of a public- officer pursuant' to any provision of law authorizing such officer to receive the same shall he denominated public moneys, interest money received by a county treasurer on State money deposited in a bank, which he converted to his own use, is public money for which said treasurer and his surety are liable in an action on his bond.
    2. Same — Treasurer’s Books — Entries—Notice—Limitation of Actions.
    Where the county treasurer failed to comply with the provisions of the statute (1 Comp.. Laws 1915, § 2383), and neglected to enter the interest items On his books, and the board of supervisors in its annual audit did not know of these items, under 3 Comp. Laws 1915, § 12330, the statute of limitations (3 Comp. Laws 1915, § 12323) would not bar an action therefor on his official bond, although not brought within the ten-year period provided in said statute.' County of Saginaw v. Kent, ante, 160.
    3. Same — County Entitled to Interest on Money Converted.
    Saidftnoneys having been received by the county treasurer . in violation of law, and not by-\reason of any mistake thereunder, the judgment against him should have included interest from the dates he received said payments.
    Error to Bay; Houghton (Samuel G.), J.
    Submitted June 11, 1919.
    (Docket Nos. 17-19.)
    Decided April 10, 1920.
    Separate actions by the board of supervisors of Bay county against Edward E. Corliss, principal, and the American Surety Company of New York, surety, Edward E. Corliss, principal, and the Title Guaranty & Surety Company, surety, and Omar J. Morton, principal, and the Title Guaranty & Surety Company, surety, on official bonds. From the judgment rendered, all parties bring error.
    Reversed.

      Sheridan F. Master, Assistant Attorney General, and John L. Stoddard, Assistant Prosecuting Attorney, for plaintiff.

      Lewis J. Weadock, for defendants.
   Moore, C. J.

After these cases were argued as one in this court they were assigned to Justice Ostrander, who died before writing an opinion in them.

Plaintiff seeks in three suits, which are combined in one printed record, to recover upon the official bonds of the county treasurers, Morton and Corliss, certain interest moneys claimed to have been paid to them by certain banks, upon public funds, which interest it is claimed they converted to their own use, together with interest thereon from the dates that they were paid.

The declarations in the three cases are in substantially the same form. Bills of particulars were demanded and furnished.

In the Morton case the plea was the general issue with notice that the defendants would show in their defense:

(1) That the money upon which interest was paid “did not actually or constructively belong to the county of Bay or constitute a part of the public moneys of said county, but were current or so called initial collections of State moneys made by the county treasurer from the township treasurers, for which the county treasurer was accountable only to the State of Michigan.”

(2) That the defendant treasurer was acting as the agent and representative of the State of Michigan and not as the agent or representative of the county of Bay.

(3) That certain of the items claimed in the declaration and bill of particulars accrued more than ten years prior to the commencement of the suit and were barred by the statute of limitations.

The pleas in the other two cases were substantially the same except that the statute of limitations was not pleaded.

The cases were tried together before the court without a jury — the question of the right of the plaintiff to recover being first determined in the affirmative by the circuit judge on June 1, 1918, after which there was a further hearing and on December 24, 1918, the court determined in a further findings of fact and lav; the amounts for which judgments should be entered in each case. Exceptions were filed by both the plaintiff and the defendant treasurers. Judgments were entered as follows:

Against Omar J. Morton and his surety, thé Title Guaranty & Surety Co., for the sum of $4,566.66, — ■ entered January 3, 1919.

Against Edward E. Corliss and his surety, the Title Guaranty & Surety Co., for the sum of $2,140.57,— entered January 3, 1919.

Against Edward ,E._ Corliss and his surety, the American Surety Co., for the sum of $1,353.19, — entered January 3, 1919,

- — from which the plaintiff and the defendant treasurers have brought the case here by writ of error. The surety companies have not appealed.

The defendants discuss seven assignments of error. While we have considered them all we shall discuss but one group of them. Quotations from the briefs of defendants’ counsel clearly state their contention:

“The deposit of the moneys in question by defendants respectively consisted of initial or current collections of State taxes exclusively. The deposits were not commingled with Bay county money or with the personal accounts of either defendant. The deposits were not of funds received by them as county treasurers of Bay county but solely and strictly as agents of the State of Michigan, wholly beyond the direction, control or supervision of the Bay county supervisors or auditors. Section 298, 1 Comp. Laws 1915, designating public moneys, does not authorize or permit Bay county to claim interest on the funds in question. If so, Bay county with equal propriety could claim the interest on State moneys deposited elsewhere as well as in Bay county under the claim that the State agents elsewhere were not entitled to same. Section 299, 1 Comp. Laws 1915, relied on by the court below, has no application for the reason that no claim is made of any commingling of funds. The funds were kept separate and apart.
“Section 300 fails of application because the funds were turned over to the State in the full amount exacted from the State for these taxes. The funds were not loaned by either defendant. The court misapplies sections 301 and 302. These sections expressly sustain defendants’ contention that under no theory could the interest' on initial State taxes belong to Bay county. The ownership of the principal fund is in the State of Michigan, and even.though the interest thereon could not be retained by defendants (which is not conceded), still Bay county is without rightful claim to or ownership' of the interest earned by the fund. Plainly stated, the interest belongs either to the State or to the defendants, not the county of Bay.
“Section 2376,1 Comp. Laws 1915 (Act No. 99, Pub. Acts 1909), does not permit the designation of depository of initial State tax collections. The. county treasurer is the agent of the State in making these collections not as county treasurer of Bay county but because the individual, who happens to be in that office, is designated such State agent wholly aside and apart from his agency of Bay county in the matter of the collection of other taxes. In the latter capacity he collects as agent of the county, the county taxes, formerly liquor taxes, and delinquent State taxes because the former are county taxes and the latter are a direct charge against the county by the State. ■
“It is also to be noticed that in the case of Mr. Morton, Act No. 99, Pub. Acts 19.09, above, became effective September 1, 1909, and certainly has no application during his first term, 1907-1908, and not until after two-thirds of his second term, if at all, which, it is contended, does not. * * * It would clearly be a violation of the statute for these defendants to have deposited these State taxes in the county depository as they would then have been commingled with other moneys, and if it is the theory of the law that the individual shall not profit e by the interest received from public funds, certainly it must follow that a minor subdivision of the State should not be entitled to profit from the interest on funds belonging to the State.”

It may be well here to quote some provisions of the statute. Section 298, 1 Comp. Laws 1915, reads:

“(298) Section 1. The People of the State of Michigan, enact, That all moneys which shall come into the hands of any officer of the State, or of any officer of any county, or of any township, school district, highway district, city or village, or of any other municipal or public corporation within this State, pursuant to any provision of law authorizing such officer to receive the same, shall be denominated public moneys within the meaning of this act.”

Section 301, 1 Comp. Laws 1915, reads:

“(301) Sec. 4. In all cases where public moneys are authorized to be deposited in any bank, or to be loaned to any individual, firm, corporation, for interest, the interest accruing upon such public moneys shall belong to and constitute a general fund of the State, county, or other public or municipal corporation as the case may be.” ■

Section 2372, 1 Comp. Laws 1915, provides that — •

“Whenever the condition of the county treasurer's bond shall be forfeited to the knowledge of the board of supervisors of the county, they shall cause such bond to be put in suit,”

—and it is provided in the following section (2373) that:

“All moneys recovered in such action shall be applied by the board of supervisors to the use of the county or to such other use or uses as the same ought properly to be applied to.”

As early as Attorney General v. Supervisors of St. Clair County, 30 Mich. 388, the relationship of a county treasurer to his county and the State was ably discussed by Justice Cooley. We shall not quote from the opinion, but content ourselves with referring' to it.

In Marquette County v. Ward, 50 Mich. 174, the opinion was also written by Justice Cooley. It was held in substance:

“A county treasurer’s bond requires him to account for ‘all moneys which shall come to his hands as treasurer.’ Held, that this covers moneys collected by him under the liquor tax law though they neither belong to the county nor go into the county treasury.”

See, also, Auditor General v. Board of Sup’rs of Ottawa Co., 76 Mich. 295.

In Board of Sup’rs of Kent Co. v. Verkerke, 128 Mich. 202, Justice Hooker, speaking for the court, said:

“These funds came into the hands of the county treasurer by virtue of his office. He hela them officially, and, whatever may have been his title to such funds under the law passed upon in the case of Perley v. County of Muskegon, 32 Mich. 132 (20 Am. Rep. 637), they are certainly public moneys under section 1197 of the Compiled Laws, which took effect three months after the Perley Case was heard in this court. Not only does section 1197 definitely establish the rule that such funds are public moneys, and therefore can not belong to the custodian, but section 1198 requires him to keep them separate and apart from his own money, while section 1199 prohibits use by him for a private purpose under any pretext and forbids the loan of such funds. Section 1200 provides that where such funds are authorized -to be deposited in a bank, the interest accruing shall belong to and constitute a general fund of the State, county or other public or municipal corporation as the case may be. Under this section it is clear that if such money was lawfully deposited, the interest does not belong to the respondent. His counsel seems to recognize this, but contends that the law did not authorize such deposit, and consequently that the county is not entitled to the interest. If this is true, the earnings from any unlawful and prohibited use of the money could be held by the county treasurer, notwithstanding the fact that section 1200 contemplates that earnings of such funds shall belong to the public. We think public policy should preclude the treasurer from asserting his want of authority to make the deposit.- But aside from this, the general rule that gives the cestui que trust the earnings of a trust fund is a sufficient reason for holding that the municipality, and not the treasurer, is. entitled to this interest.
“It is urged that the county is not entitled to this interest in any event, and therefore the board of supervisors have no right to this writ.. We think section 1200 settles that question by providing^ that_ it shall constitute a general fund for the municipality represented by the officer.”

The State is not here claiming this interest, indeed it was represented by the attorney general in an oral argument at the hearing, in which an affirmance of the judgment against defendants was urged. It is clear that the funds upon which the defendants received interest came into their possession because they occupied the office of county treasurer and would not have come to them had they not held that official position. We think the statutes and decisions to which we have referred clearly establish the liability of the defendants.

The plaintiff has also brought error. The first of these is that items amounting to $213.35 were not barred by the ten-year period of limitation fixed by subd. 1, section 12323, 3 Comp. Laws 1915, in the Morton case, because his books as county treasurer did not show these items, the result of which was that the board of supervisors in its annual audit did not know of these items. The statute, 1 Comp. Laws 1915, § 2333, provides:

“It shall be the duty of the county treasurer to keep the accounts of the treasurer with all banks or depositories, where any moneys may be kept or deposited, upon the regular books of his office, so that each item of all such accounts shall appear thereon. All items of interest, which may become due to the county from depositories, shall be entered on the books of the treasurer when received in such a manner that it shall appear upon what account and for what time such interest accrued.”

Because of the failure to comply with these requirements, plaintiff says the statute of limitations did not bar the action. This contention is well taken under the case of County of Saginaw v. Kent, ante, 160, :in which an opinion was handed down February 27, 1920.

In his preliminary findings the trial judge expressed himself in part as follows:

“This .cause of action grew out of the fact or mistaken idea that has existed in this and many counties of the State for many years, to the effect that county treasurers receiving State taxes should, for the protection of the moneys, deposit the same in a bank or suitable^ depository for safe keeping, and the bank being willing to pay a certain amount of interest on such, money while so deposited, the treasurers felt that they were safeguarding the funds and at the same time receiving some consideration for the extra work they did in behalf of the State, injuring nobody thereby, which practice has been followed quite universally by county treasurers in Michigan, and it is fair and just to thém to say, and particularly in this case, that there has been no intention of doing' anything wrong or illegal with the public moneys so deposited, the practice undoubtedly growing out of the old system of paying county treasurers fees rather than a salary, and the defendants in this case cannot be charged with intentionally using public moneys as the practice has resulted from a custom arising from a mistaken legal right.”

In his second findings of fact the trial judge recurs to that subject; we quote:

"From the foregoing the principal amount having been determined as well as the liability, the only other question involved is the question of interest. The time when the interest begins to run must be determined from the nature and circumstances affecting the principal indebtedness. As was pointed out in the beginning of these findings, it appears that it was understood and supposed by both, plaintiff and defendants, that the moneys involved in this issue belonged to defendants, and this status did not change until about the time this suit was commenced. Interest in Michigan is purely statutory, and when money is paid wrongfully or by mistake, whilé the amount so paid may be recovered back, interest cannot be recovered in such moneys until after demand has been made for a repayment. * * *
"Since the defendants received and appropriated to their own use the interest moneys involved in this issue in good faith, believing they were entitled to the same, and that they had been advised by able counsel that they were justified in so doing, and since the plaintiff concurred in such belief, such interest money so held by said treasurers was received by them by mistake, and in consequence thereof interest would not begin to run against such moneys until after demand had been made for the same.”

Counsel for the plaintiff say it was error in the court to decline to give the plaintiff interest from the dates at which each of the payments was made to the defendants. We do not think it can. be said that the interest was paid or received by mistake within the meaning of that term as used in the law. The banks paid the money designedly, intending to pay it. The defendants received the money, not mistakenly, but intending to receive it, and knowing the amounts thereof.

We have already quoted certain provisions of the statute. It may be well to refer to others:

Section 299, 1 Comp. Laws 1915, provides:

“It shall be the duty of every officer charged with receiving, keeping or disbursing of public moneys to keep the same separate and apart from his own money, and he shall not mingle the same with his own money nor with the money of any other person, firm or corporation.”

Section 300 reads:

“No such officer shall under any pretext use or allow to be used any such moneys * * * for his own private use, nor loan the same to any person, firm or corporation, without legal authority so to do.”

Section 302 is as follows:

“In no. case shall any such officer directly or indirectly receive any pecuniary or valuable consideration as an inducement for the deposit of any public moneys With any particular bank, person, firm or corporation.”

Whatever» may be said of the defendants personally ■ — and we are not inclined from this record to criticize what is said by the trial judge in that regard — still they must be presumed to know the law. Its provisions are clear and unambiguous. It was the duty of defendants under the law to pay over this money promptly. They have not done so, and we are constrained to hold they should pay legal interest on the amounts withheld. Counsel can probably agree upon the amount of this interest, and if so the trial judge can add it to the amounts for which he has already found defendants liable.

The judgment is reversed. Plaintiff is given costs of this court against defendants and appellants.

Steere, Brooke, Stone, and Bird, JJ., concurred. Fellows, J., did not sit.

The late Justice Ostrander and Justice Kuhn took no part in this decision.


text:
    PERFECTION SOCKET CO. v. AMERICAN FORGING & SOCKET CO.
    Contracts — Patents—Action for Royalties — Rescission oe Contract — Liability.
    In an action upon a contract for royalties for the exclusive right to use a patent device for bow sockets for automobiles, and providing that if any other device were used the contract should be terminated, where defendant operated under said contract for some time, when it rescinded same, it was liable for the royalties on all bow sockets manufactured up to the time of the rescission, although in fact said patent was never used by it.
    Error to Wayne; Davis (Frank D. M.), J., presiding.
    Submitted October 15, 1919.
    (Docket No. 46.)
    Decided April 10, 1920.
    Assumpsit by the Perfection Socket Company against the American Forging & Socket Company for royalties due under a contract. Judgment for plaintiff. Defendant brings error.
    Affirmed, conditionally.

      Arthur P. Hicks, for appellant.

      James 0. Murfin, for appellee.
   Moore, C. J.

Plaintiff, as assignee of one Ferguson, brings this action of assumpsit against the defendant to recover a royalty of six cents per set of bow sockets for all bow sockets manufactured by defendant. The declaration also contained all the common counts. The defendant in its plea of general issue gave notice that it never made use of the' device covered by the patents referred to in the contract. The case was tried before the judge without a jury. From a judgment in favor of the plaintiff in the sum of $3,311.28 the case is brought here by writ of error.

The defendant claims that under the undisputed testimony, no sockets were ever manufactured by it coming within the scope of the contract sued upon, and that, therefore, under the declaration and the proofs, there should have been a judgment of no cause of action; that under the pleadings and proofs the defendant could in no event be held liable for royalties on' sockets manufactured, after June 24, 1918., The material parts of the contract are as follows r

“This agreement made this 8th day of May, A. D. 1917, by and between the American Forging & Socket Company, of Pontiac* Michigan, a Michigan corporation, hereinafter referred to as the party of the first part, and Richard F. Ferguson, of Ecorse, Wayne county,. Michigan, hereinafter referred to as the party of the second part,
“Witnesseth, for and in consideration of the. mutual covenants herein contained, it is hereby agreed by and between the respective parties to this agreement, as follows;
“1st. Whereas, the said Richard F. Ferguson, party of the second part, is the owner of certain patents for automobile bow sockets, originally issued to Walter P. Dorl, the serial numbers of which are 1,121,553, 1,157,977 and 1,162,042.
“2d. And whereas the said party of the first part is desirous of using said patents,
“Therefore it is mutually agreed by and between the parties hereto that the said party of the first part shall have the exclusive right to manufacture the above mentioned socket, under the above mentioned patents, also any improvement heretofore made upon the same, and any improvement that may hereafter be made, provided that the said first party shall use said patent exclusively.
“It is further agreed that the said first party shall pay for the privilege above contemplated as a royalty to the said second party, his heirs or assigns, for any sockets manufactured by them, using this device or by their direction, or in their behalf, the sum of six cents for each set of sockets so made and delivered.
“It is further agreed that the said first party shall use its best endeavors to manufacture this device, and shall manufacture no other device of a similar character during the life of said patent, otherwise this contract is terminated.
“It is further agreed by and between the parties hereto that should the factory owned by the party of the first part be destroyed by fire, and said first party does not rebuild or for any other reason within their control they should cease the manufacture of sockets using the device above described, for a period of three consecutive months, then and in that event, this contract shall be considered terminated, and of no force and effect.
“It is further agreed by and between the parties hereto that the party of the first part shall keep a true and correct account of all sockets made by it, caused to be made by it, or made for its benefit, and render a true and correct statement to the said second party on the 10th day of each and every month, at which time the settlements shall be made at the rate above specified, and for the amount so made by the party of the first part.”

In the findings of fact made by the circuit judge appears the following:

“The socket, Exhibit 2, was obviously the socket contemplated by the parties when they entered into the contract on May 8th, referred to in the first paragraph hereof.
“The socket, Exhibit 2, and its further development appears would not be covered by the patents referred to in the first paragraph of the contract set forth in the first paragraph hereof.
“The defendant company sold 93,171 sockets up to June 24,1918. They have sold 19,382 sockets between that date and the date of the trial, December 26th. They have paid royalties under and by virtue of the contract set forth in the first paragraph hereof, on 57,365 sockets.
“They had the opinion of a patent lawyer in February to the general^ effect that the product they were manufacturing was not covered by these patents. * * *
“On the 24th day of June, 1918, the defendant company, by a resolution of its directors, decided to recognize no further liability under the contract of May 8th, and advised the plaintiff company that they never had used the devices referred to in said contract and had no intention of so doing.”

The plaintiff did not propose any amendments or take any exceptions to these findings.

It is conceded that there were 35,806 sets of sockets manufactured by defendant prior to June 24, 1918, on which royalties had not been paid. The amount of these royalties would be $2,148.36. The president of the defendant company testified that one of the reasons for making the contract was to avoid litigation. This witness was interested as a member of the plaintiff company and was the only director who was' not in favor of the resolution of June 24, 1918.

It appears beyond controversy that the parties to this contract acted under it until the adoption of the resolution of June 24, 1918. At that date they had credited upon the books of the company for royalties $1,499.98, which has never been paid. We' have ah ready seen that the patents mentioned in the contract did not cover the sockets which were .in fact made. It must be assumed that the reference in the contract to the patents had some purpose.

A contract having some features in common with the one before us was under consideration in Hall Manfg. Co. v. Railway Supply Co., 48 Mich. 331. The opinion reads in part as follows:

“It is in the second place said that this agreement was not made upon a valuable consideration, as the patent referred to was void.
“This question we think is not open to controversy in the present case. The contract shows that the defendant, at the time of this agreement, was the owner of the patent with which this is supposed to conflict, and that this agreement was entered into apparently to avoid any conflict, and in order that the royalty should be divided. The defendants therefore are in no position to question the validity of the plaintiff’s patent in the present action brought to recover a royalty earned or due on account of rails manufactured and sold thereunder.”

In Hamilton v. Park & McKay Co., 112 Mich. 138, Justice Grant, speaking for the court, said :

"1. It is insisted that the plaintiff cannot maintain an action before the issuing of the patent, and that no liability was intended to be incurred until a valid patent had been granted. This was a matter of contract between the parties. The inventor of an unpatented device may make a valid contract for its manufacture, use, or sale. It is no objection to the validity of such a contract that any person may manufacture it until a patent is issued. The vendee or licensee, in the absence of fraud or mistake, must abide by his contract. * * *
"Did the notice of forfeiture destroy the right to recover for royalties accruing prior thereto? In support of the ruling of the court below counsel cites Jewett v. Petit, 4 Mich. 508; Goodspeed v. Dean, 12 Mich. 352; Hubbardston Lumber Co. v. Bates, 31 Mich. 158, 169; Curtis on Patents, § 218; Woodworth v. Weed, 1 Blatchf. 165; Woodworth v. Cook, 2 Blatchf. 151. * * *
"None of these decisions are applicable to cases where the licensee agrees to pay a royalty for every machine manufactured and sold, or a specific sum at stated periods. The obligation to pay becomes fixed in such cases, the moment the machine is manufactured and sold, or at the time fixed by the contract for the payment of the amounts due for past use or sale. The licensee refuses to pay. The licensor, as he has the right to do, rescinds the contract. Upon what principle of law or logic should the licensor be held thereby to lose what is honestly his due, and of which the licensee has had the benefit? The effect of such a rescission must be determined in view of all the surrounding circumstances. Plaintiff is not seeking his property and its price, too. tie has performed his agreement. Defendant is in default, and indebted for accrued royalties. This case is rather in the nature of a lease where the lessee is in default of his rent. He may be ousted for nonpayment, but this does not bar an action to recover the rent due. We think the authorities sustain the plaintiff’s right of action. Hurst v. Bookbinding Co. (Com. P.), 22 N. Y. Supp. 371; Mayor, etc., of New York v. Construction Co., 146 N. Y. 210 (40 N. E. 771). The true rule is this: The rescission of a contract as against the party in default does not, in the absence of an agreement, destroy the right to recover royalty or rent which has already been earned. The past-due payments are separable from future 'payments, and the rescission is neither ab initio nor in toto, but solely in futuro.”

In the instant case after the contract was made both parties acted under it until defendants gave notice of-rescission. We think, under the facts disclosed by this record, they had a right to give this notice, and that they should pay royalties up to the time of the rescission. The trial judge, however, required them to pay royalties as though no notice of rescission had been given and up to the time of the trial. In doing this we think he was wrong. If the plaintiffs will remit the judgment to the sum of $2,148.86, with interest thereon at five per cent, from June 24, 1918, within ten days of notice of the filing of this opinion, the judgment thus modified will be affirmed. Otherwise it will be reversed and a new trial ordered. The-defendant will recover costs.

Steere, Brooke, Fellows, Stone, Bird, .and Sharpe, JJ., concurred.

Justice Kuhn took no part in this decision.


text:
    GOLDEN & BOTER TRANSFER CO. v. BROWN & SEHLER CO.
    1. Master and Servant — Workmen’s Compensation Act — Employer's Right to Proceed Against Wrongdoer — Election of Remedies by Employee.
    Under section 15, part 3, of the workmen’s compensation act (Act No. 10, Pub. Acts 1912, Extra Session), an employer is entitled to recover from the wrongdoer the amount of compensation which he was compelled to pay, under said act, for the death of an employee, although the death was instantaneous, and the deceased employee never exercised his right of election to proceed under the act against the employer, or under the common law against the wrongdoer.
    2. Same — Relation of Master and Servant.
    In an action by the employers, under said act, to recover from the wrongdoer the amount of compensation paid for the death of an employee, where it was undisputed that said employee was hired by plaintiffs, was paid by them, and was in charge of one of their teams, it cannot be contended that he was not an employee of plaintiffs, although at the time of the accident he was engaged by the day in clearing away debris from a burned building owned by defendants under an arrangement made by them with plaintiffs.
    3. Same — Defense of Assumption of Risk Not Available.
    In said action, under the workmen’s compensation act, the defense of assumption of risk by the deceased employee is not available.
    4. Same — Negligence—Notice—Question for Jury.
    Where deceased was killed by the falling of a wall of a burned building owned by defendants, and there was testimony that the building inspector told one of the defendants that part of the wall which fell should come down, it cannot be contended that there was no proof of defendants’ negligence.
    5. Same — Unusual Storm — Act of God — Question for Jury.
    Where it was claimed on the part of defendants that the cause of the falling of the wall was an extraordinary storm, amounting to an act of God, held, that said question was for the jury, under proper instructions.

      For authorities passing upon the question of rights and remedies under workmen’s compensation acts where injuries were caused by negligence of third person, see notes in L. R. A. 1916A, 360; L. R. A. 1917D, 98, and L. R. A. 1918F, 524.
    On liability under English act of 1906 of third persons whose negligence caused the injury (§ 6) L. R. A. 1916A, 100.

      6. Same — Constitutional Law — Workmen’s Compensation Act —Title on Act — Sufficiency.
    Section 15, part 3, of the workmen’s compensation act, giving to the employer a right of action to recover from the wrongdoer the amount of compensation paid by said employer, held, not unconstitutional because not within the scope of its title. MacMn v. Detroit-Timkin Axle Co., 187 Mich. 8.
    Error to Kent; McDonald (John S.), J.
    Submitted October 8, 1919.
    (Docket No. 10.)
    Decided April 10, 1920.
    Case by Golden & Boter Transfer Company against Brown & Sehler Company and another to recover damages paid to a dependent under the workmen’s compensation act for the death of an employee killed by reason of defendants’ negligence. Judgment for plaintiff. Defendants bring error.
    Affirmed.

      Boland J. Cleland, Earl F. Phelps and Lombard, & Hext, for appellants.

      Kerr & Lacey and M. Thomas Ward, for appellee.
   Moore, C. J.

The trial judge stated the issues involved in this litigation in his charge to the jury as follows:

“This is an action by Golden & Boter, the plaintiffs, for the use and benefit of the Zurich General Accident & Liability Insurance Company, against Brown & Sehler Company and EDoertz & Son to recover the amount of compensation which the plaintiff was compelled to pay to the widow of John Mellema, whose death was caused, as the plaintiff claims, by reason of the negligence of the defendants.
“The plaintiffs, Golden & Boter, are engaged in the business of general teaming ánd as a part of such business furnish teams and teamsters to contractors and others. Hoertz & Son are general contractors in this city, and at the time of the accident were engaged in razing and tearing away the debris accumulated by reason of a fire in the Brown & Sehler building located at the corner of Front street and Bridge street in this city. The Brown & Sehler Company owned the building which was destroyed by fire the 15th day of January, 1915, and had at the time in question employed Hoertz & Son to do the work in which they were engaged when this accident took place.
“On the first day of February, 1915, at the request of Hoertz & Son, Golden & Boter sent teams and teamsters to assist in the work of carrying away the debris. One of these teamsters was John Mellema. While so engaged, Mellema was killed, was instantly killed by the falling of a wall. His widow presented a claim for compensation from Golden & Boter under the workmen’s compensation act of Michigan. The industrial accident board awarded her $6.05 per week for the period of three hundred weeks from the first of February, 1915, the time of the accident. Under this award, Golden & Boter, by the Zurich General Accident & Liability Insurance Company, paid the sum of a thousand dollars, * * * and to recover this amount so paid, the plaintiffs have brought this suit. They claim that the accident was caused by the negligence of the defendants in failing to provide a reasonably safe place in which Mr. Mellema could do his work. That the walls were dangerous and should have been razed or braced before the men were allowed to work near them.
“The defendants deny that they, or either of them, were negligent, as the plaintiff claims. They deny that the wall which fell was dangerous or defective in any manner. They say that they examined it and found no defects. That after the fire the premises had been examined by the fire department and by Mr. Davidson, the building inspector of Grand Rapids, and that a part of the wall in question had been taken down by the firemen under Mr. Davidson’s direction, and that the defendants had no reason to believe that the portion that was left was in any way defective or unsafe. Defendants say that they used their best judgment in an effort to determine the safety of the wall, and that so far as a careful inspection of the wall would show, it appeared to be reasonably safe; that they used every reasonable means to make a place where the workmen were employed reasonably safe, and that the wall did not fall because it was defective or weak or unsafe, but because of an unusual and violent windstorm. Defendants therefore say that they were not guilty of the negligence as claimed by the plaintiff.”

The trial judge then gave the jury an elaborate charge as to the law he deemed applicable to the various phases of the case which charge takes up 12 pages of the printed record, and includes 8 carefully prepared written,requests to charge, offered on the part of the defendants.

The jury returned a verdict in favor of the plaintiff in the sum of $1,046.65. The case is brought here by writ of error.

Counsel say the court erred in not directing a verdict for the defendants and in not granting defendants’ motion for a new trial and motion for judgment in their favor, claiming there had been an election of remedies. We quote from the brief:

“We are not unmindful of the fact that this court has considered section 15, part 3, of the workmen’s compensation law, so-called, in the case of Grand Rapids Lumber Co. v. Blair [190 Mich. 518]. In that case however, the employee was injured but not killed, and he elected to proceed under the workmen’s compensation law against his employer and recovery was had against the .employer as authorized by the act. This court also had this section before it in Albrecht Co. v. Iron Works [200 Mich. 109]. This also was a case where the employee was injured and received compensation from his employer. In neither case was there any question as to who was the employer.
“In this case, Mellema, the employee, was not alive to make his election. The widow, a dependent mentioned under section 6 [part 2], of the act, recovered as a dependent. Entirely independent of the question of the constitutionality of section 15 [part 3], of the act, which will be later considered in this brief, the defendants contend that section 15 gives no authority to maintain this action. If Mellema had been injured only, instead of death resulting from the accident, he would have the right of electing to proceed against any person or corporation liable, and had he done so, he would have waived his right to compensation. Nothing appears in this act that authorizes his personal representatives or any other person or persons to make such an election for him. The law makes no provision and provides no method of procedure for recovery, and it is quite probable' that the legislature foresaw the difficulties that might arise in cases similar to the case at bar and for that reason intentionally omitted attempting to outline any such procedure.”

Mrs. Mellema is not interested in the present litigation. It is authorized in express terms by section 15, part 3, of Act No. 10, of the Public Acts of 1912, Extra Session (2 Comp. Laws 1915, § 5468), as construed in Albrecht Co. v. Iron Works, 200 Mich. 109; Vereeke v. City of Grand Rapids, 203 Mich. 85; Naert v. Telegraph Co., 206 Mich. 68.

Counsel also claim the court erred in not granting defendants’ motion for a directed verdict and in not granting defendants’ motion for a new trial on the theory that Mr. Mellema was not an employee of Golden & Boter. We think this contention is disposed of by the undisputed testimony that Golden & Boter hired him and paid him and put him in charge of one of their teams, harness, and wagon, and while they in turn sent him and his outfit to do the work for Brown & Sehler, through an arrangement with Hoertz & Son to work by the day, he was all the while in the employ of Golden & Boter. See Joslin v. Grand Rapids Ice Co., 50 Mich. 516 (45 Am. Rep. 54) ; Janik v. Ford Motor Co., 180 Mich. 563 (52 L. R. A. [N. S.] 294, Ann. Cas. 1916A, 669).

It is urged that Mr. Mellema assumed the risk. If he was in the employ of Golden & Boter, as we have just found, the doctrine of assumed risk would not apply.

Counsel say a verdict should have been directed in favor of the defendants- because the evidence in the case fails to establish any negligence on their part, and great stress is laid' by counsel upon the claim that they did not know that the firemen had rocked the wall when they pushed some of them over. There had been a very disastrous fire. Some of the walls had fallen, making a removal of the debris necessary. There would have been no difficulty if the inquiry had been made in learning just what tests- had been made by the building inspector and the police department to determine the safety of the walls. It is a pertinent inquiry as to whether a man of ordinary prudence would not have made inquiries of the building inspector arid the fire marshal as to what tests had been made. There is testimony to the effect that the building inspector told one of the defendants that part of the wall which fell should come down.

Some of the testimony of John Sehler is illuminating. We quote:

“After the fire I had charge of looking after the insurance and letting contracts for clearing the debris and saving salvage in behalf of Brown & Sehler. The buildings were insured. Mr. William Hoertz represented us in figuring the loss on the building. The loss was adjusted on Wednesday of the last week of January. We then took steps to clear up the site and get out the salvage. I let the contract with Hoertz & Son on Saturday. I commenced considering that matter the next day after the insurance was- adjusted. I telephoned Mr. Hoertz Friday evening after adjusting the insurance on Wednesday; they began work Monday morning. * * *
“Recross-examination: From January 15th, the date of the fire, to January 26th, when the insurance was adjusted, I didn’t do anything with reference to protecting the walls, except to call Mr. Davidson to come over and talk about the building. I did not call any one else in consultation during that time except Mr. Hoertz with reference to the insurance. I talked with him about the walls but not as to what should be done to make them safe.
“Q. Did he tell you that some of those walls must come down?
“A. Saying in regard to the new building, yes.
“Q. And you received insurance for the walls that must come down, did you not?
“A. I expect so.
seQ. And in that insurance that you received was there something for this north wall?
“A. How is that? Along with the rest, sure.
“Q. Along with the rest, (Showing picture.) Do you know whether in the insurance that you received that this wall was included, this part that is still standing?
“A. I couldn’t separate it.
“Q. You don’t know, but you do know that there was taken into consideration the fact that those walls could not be used again and you received insurance upon them?
“A. We had a certain amount of insurance and we received that, and that was on the. whole building.
“Q. And the walls were taken into consideration, were they not?
“A. Yes.”

When it is stated that the witness was a member of the firm of Brown & Sehler and that William Hoertz was a member of the firm of Hoertz & Son we think it cannot be said there was no proof of negligence.

The defendants contend that aside from all other elements of this case, the court should have directed a verdict on the ground that the accident was the result of unforeseen conditions and comes within the rule as an act of God, because of the unusually high wind, — citing authorities.

The court charged the jury:

“Now if you find that the sole cause of the falling of the wall was an extraordinary wind storm, such a wind storm as our experience in this locality would not lead us to anticipate, your verdict should be for the defendants, a verdict of no cause of action, for the falling of the wall from such a cause would be what is termed an act of God. I am going to repeat that to •you again so that we will make no mistake about your getting it. If you find that the sole cause of the falling of the wall was an extraordinary wind storm, such a wind storm as our experience in this locality would not lead us to anticipate, your verdict should be for the defendants, a verdict of no cause of action, because the defendants would not be required by the law to guard against such an extraordinary storm as I have just been speaking of, for the falling of the wall from such a cause would be what is termed the act of God. By the term ‘act of Gods is meant those events and accidents which proceed from natural causes and cannot be anticipated and provided against, such as unprecedented storms, or freshets, lightning, earthquakes, etc. For a loss occasioned by the act of God, as I have defined it, the defendants would not be responsible. If the sole cause of the falling of the wall was an act of God, I said the plaintiff cannot recover.”

The jury was charged in.great detail upon this subject.

Counsel query, “Was that part of section 15, of part 3 of Act No. 10 of the Public Acts of 1912,' Extra Session, relied upon by the plaintiff in this case, unconstitutional because of not being within the scope of the title of said act.” The title of the act is quoted and counsel say:

“A careful examination of the title "to the act in question shows no reference in any way to a third person. _ The act is clearly and distinctly, so far as its title is concerned one pertaining to the relationship of master and servant. It will .be observed that leaving out section 15 of part 3, third persons are in no sense and in no way made parties to the act, and none of the obligations, rights or remedies that it imposes apply in any way to third persons. It will be further observed that section 15 creates a new obligation on the part of third persons. It creates a new basis or an entirely different basis as a measure of damage for which the third party is required to respond, and the fact that in most instances it might be more favorable than in an action at law for negligence cannot operate to validate the law.”

In Mackin v. Detroit-Timkin Axle Co., 187 Mich. 8, Justice Steere had under consideration this very subject. We quote from his opinion:

“The particulars pointed out in which it is claimed the act contains provisions not referred to or compre-, hended in the title are that it repeals an existing statute relative to contracts with attorneys for services, creates a right of action against a third party by the employer of the injured, subrogating the employer to the rights of the employee, and requires thé injured employee to seek compensation from an insurance company, instead of his employer. The last objection, we think, is disposed of in Barnard v. McLeod, 114 Mich. 73, where section 16 of the mechanic’s lien law (Act No. 179, Pub. Acts 1891), providing for subrogation under certain circumstances, was sustained, although the title of the act did not in terms give notice of such a provision, and the constitutionality of the act was assailed on the ground of defective title, and the court said:
“ ‘We think there is no merit in the constitutional question raised.’
“If there be any repeal of the statute with reference to attorney’s contracts, it is by implication only. The portion of the act questioned provides:
“ ‘The fees and the payment thereof of all attorneys and physicians for services under this act shall be subject to the approval of. the industrial accident board.'
“This is but a detail of method for ascertaining and insuring in the first instance full payment to the injured, is germane to the act, and its repealing effect by implication is a matter of construction. An examination of sections 6 and 14 [part 3], of the act clearly indicates that the employee is not relegated to seek compensation for his injuries to an insurance company, but liability under the act is clearly upon the employer, and the provisions for insurance are in security and aid of payment by him.
“Details in many respects similar to these, and numerous others not specifically enumerated in the titles are to be found in the Wisconsin, Massachusetts, Minnesota, Ohio, Illinois, New Jersey, California, and Montana employers’ compensation acts, the general constitutionality of which has been sustained; and, while it does not appear that these exact objections were raised and passed upon, those acts and the opinions sustaining them are significant and persuasive of the natural and necessary scope of this class of legislation in order to accomplish the object sought, as declared in a general title. We think the objections urged to the title of this act are not tenable under the decisions of this -and other courts.”

We have discussed the most important assignments of error. We have carefully considered the others but cannot discuss them in detail without making this opinion unduly long. We find no reversible error.

The judgment is affirmed, with costs to the plaintiff.

Steere, Brooke, Fellows, Stone, Bird, and Sharpe, JJ., concurred.

Justice Kuhn took no part in this decision.