text:
    WALLACE v. H. W. NOBLE & CO.
    1. Evidence — Damages—Admissions—Stock and Stockholders— Wrongful Sale.
    In an action for damages for the unauthorized sale of shares of stock, testimony as to a conversation between plaintiff and an officer of defendant corporation, in which plaintiff admitted that shortly before the trial he could.have repurchased the stock, and that the difference between the price accounted for and what it would have cost him to repurchase was only $600, was admissible.
    2. Same — Compromise—Admissions.
    The exclusion of said testimony cannot be justified upon the theory that it was an effort to compromise, since, if made, it was an admission of a material fact.
    3. Same — Damages.

      Held, error to refuse to allow defendant to show what it would have cost plaintiff to repurchase.the stock within a reasonable time after he had knowledge of its wrongful sale.
    4. Estoppel — Ratification—Question foe' Jury.
    In an action for damages for the unauthorized sale of shares of stock, where defendant claimed that plaintiff was estopped by a letter which he had written ratifying the sale, which plaintiff denied, claiming defendant had not fully and correctly informed him as to the facts at the time the letter was written, the question was for the jury.
    5. Damages — Stock and Stockholders — Wrongful Sale.
    Plaintiff is entitled to recover upon the basis of the highest market price reached by stock between the time of its wrongful sale and the expiration of'a reasonable time to enable him to purchase other shares on the market.
    6. Same — Miscarriage of Justice — Statutes.
    If plaintiff, by the expenditure of $600 or $800, within a reasonable time could -have placed himself in statu quo, a judgment of $3,500 cannot be sustained under section 28, chap. 50, Act No. 314, Pub. Acts 1915 (3 Comp. Laws 1915, § 13763), upon the theory that there was no injustice.
    See note in 50 L. R. A. (N. S.) 1046.

      Error to Wayne; Brown, J., presiding.
    Submitted June 6, 1918.
    (Docket No. 43.)
    Decided September 27, 1918.
    Rehearing denied January 31, 1919.
    Assumpsit by Newell B. Wallace against H. W. Noble & Company for breach of a contract for the sale of corporate stock. Judgment for plaintiff. Defendant brings error.
    Reversed.

      Charles F. Delbridge, for appellant.

      Lucking, H elf man; Lucking & Hanlon, for appellee.
   Moore, J.

This action was brought to recover damages for an alleged breach of contract in the unlawful sale in April, 1915, by defendant of 20 shares of stock •of Ford Motor Company, Ltd., of Canada. From a judgment in the sum of $3,500 in favor of the plaintiff the case is brought here by writ of error. The trial judge in overruling a motion for a new trial made so complete a statement of the issues involved that we quote therefrom as follows:

“This was an action of assumpsit brought in the summer of 1915 by Newell B. Wallace against H. W. Noble & Company, a corporation, for damages for the breach of a certain written contract entered into between che parties on or about October 7, 1913. This contract provided among other things substantially that the parties to the contract should purchase 25 shares of the stock of the Ford Motor Company of Canada, Limited, at $550.00 per share, making a total purchase price of $13,750.00. It was provided that the stock should be carried until by mutual agreement the parties disposed of it. The contract was signed by both parties and pursuant thereto the 25 shares of stock were purchased in two lots, one of 5 shares and one of 20 shares. .It appeared, however, that the defendant in the case actually paid $10,890.00 for the 20-share lot instead of $11,000.00, there being a commission of $110.00 charged in this transaction by the defendant of which fact plaintiff apparently had no knowledge until the trial of this case. The 25 shares of Ford stock, together with 20 shares of the stock of the Union Trust Company, then owned by plaintiff, were deposited as security with the Wayne County & Home Savings Bank in Detroit and a loan was there obtained of sufficient money to pay the original purchase price of the 25 shares of Ford stock.
“It is undisputed that on or about August 14, 1914, by the mutual consent of both plaintiff and defendant, 5 shares of the original purchase were sold and the proceeds duly accounted for by defendant. It is also undisputed that at one time the bank required a payment of $500 upon the loan in addition to the collateral owned by plaintiff which it held and that this sum of $500 was advanced as provided in said contract by the plaintiff to the defendant, and paid to the bank as requested.
_ “The remaining 20 shares of Ford stock were carried in the joint account until on or about April 6, 1915, when defendant, without the knowledge or consent of plaintiff, and in violation of said contract, and • without giving any notice to plaintiff, sold all the remaining 20 shares of Ford stock. Defendant accounted to the plaintiff on the sale of these remaining 20 shares at the rate of $685.00 per share, in addition to a dividend of $30.00 per share which had been declared by the officials of the Ford Company on or about April 5, 1915. It is not exactly clear at what price these shares were actually sold, although the defendant produced evidence to show that part were, sold at $675.00 per share and the balance at $700 per-share. This unauthorized sale of 20 shares is the one of which plaintiff complains and for which he claims damages.
“It is undisputed that plaintiff, at the time of the alleged unauthorized sale and for sometimé prior thereto, had been out of the State, he then being a salesman for D. M. Ferry & Company and traveling in 'various parts of the United States. Between the time of the sale, namely, April 6, 1915, and April 30, 1915, Mr. Albert Nebe, one of the defendant’s salesmen, who had knowledge of the transaction whereby the Ford stock above mentioned was held by the parties on joint account, wrote several letters to plaintiff, which letters in general spoke highly of the stock of the Ford Motor Company of Canada and led plaintiff to believe that the stock would continue to increase in price. Finally, about the end of April, plaintiff wrote a letter in which he commented upon the profits that would be made by the parties by holding the Ford Company stock until a higher price was obtained. In reply to this letter, Mr. H. V/. Noble, the chief stockholder in the defendant company, wrote the plaintiff under date of April 30, 1915, and informed him that the stock had been sold and offering certain explanations why the stock had been sold. On or about May 4, 1915, plaintiff wrote a letter apologizing for the tone of his previous letter and apparently ratifying the alleged unauthorized sale. It is undisputed that plaintiff was not notified of the sale of the stock prior to the letter of Mr. H. W. Noble of April 30, 1915.
“Defendant claimed that plaintiff was estopped to claim any damages by reason of the letter of May 4th above mentioned, and plaintiff claimed that when he wrote this letter he did not have such a full, correct, and complete statement of the facts as it' was the duty of defendant to furnish, and therefore the alleged ratification and estoppel was of no validity.”

We shall not attempt to discuss all of the appellant’s 197 assignments of error which he groups in his brief under three heads, as follows:

First, those pertaining to the court’s failure to direct a verdict; second, those pertaining to various rulings throughout the taking of the testimony, tending to prejudice the defendant’s case before the jury; and, third, those pertaining to the court’s rule of damages, especially as to reasonable time.

As to the first of these groups we shall content ourselves with saying that we think there was a case to be submitted to the jury under proper instructions.

Was there error in the rulings in relation to the admission of testimony? Defendant sought to show a conversation Mr. Noble had with the plaintiff in which plaintiff admitted that shortly before commencing suit on July 31, 1915, he could have repurchased the stock and that the difference between the $685 per share accounted for to him by defendant, and what it would have cost plaintiff to have repurchased after he had knowledge that the stock had been sold without his consent, was only $600. The exclusion of this testimony is sought to be justified upon the theory that it was an effort to .compromise; we think, if made, that it was more than an effort to compromise; it is an admission of a material fact and the testimony should have been allowed.

We also think it was error to refuse to allow the defendant to show what it would have cost the plaintiff to repurchase the stock within a reasonable time after he had knowledge of its wrongful sale. We do not think it could be said as a matter of law that plaintiff was estopped by his letter of May 4, 1915, and that for that reason a Verdict should have been directed. See Blount v. Eames, 150 Mich. 35; Coffey v. McGahey, 181 Mich. 225.

The appellant offered 49 written requests to charge, among them was one reading:

“Plaintiff, when he learned that his interest in the stock had been sold without his consent, if you find such sale was contrary to the terms of the agreement, was entitled at that time, to demand and receive from the defendant ten shares of stock in the Ford Motor Company, Ltd., of Canada, together with a sum equal to the dividends and interest thereon, declared subsequent to such wrongful sale, and in lieu thereof, the plaintiff was entitled to demand and receive from the defendant such a sum of money as would enable the plaintiff to go into the open market and buy ten shares of such stock within a reasonable time thereafter.”

The court charged the jury upon that subject as follows:

“The measure of damages in stock transactions of this kind is the difference between the amount reeeived and the highest intermediate value reached by the stock between the time the plaintiff had information of the wrongful acts complained of, and a reasonable time thereafter to be allowed to plaintiff to place himself in the position he could have been in, had not his rights been violated. _ •
_ “Now a reasonable time is such a period of time as would be' a reasonable time in which to make a sale of stock held in joint account such as this; after one of the parties thereto makes a demand upon the other that the stock be sold, and in considering what would be a reasonable length of time, you must consider all the circumstances surrounding the case — not how quickly stocks could have been bought or sold, but what would be a reasonable length of time for him to wait before consenting to make sale of a joint account after demand had been made that he make a sale. A reasonable time would be the time which would elapse after notice to sell to the timé when he could be legally required to make the sale.”

Counsel for the appellee cite in support of the charge Hubbell v. Blandy, 87 Mich. 209; Wright v. Bank of the Metropolis, 110 N. Y. 237 (18 N. E. 79, 1 L. R. A. 289, 6 Am. St. Rep. 356); Galigher v. Jones, 129 U. S. 193 (9 Sup. Ct. 335); Wilson v. Mining Co., 227 Fed. 720 (142 C. C. A. 245), and other cases. So far as these cases are applicable to the instant case, they do not sustain the charge of the court but are favorable to the contention of appellant. No case is cited by counsel on either side which is on all fours with the case we are now considering, but the principle involved was before this court in Vos v. Child, Hulswit & Co., 171 Mich. 595 (43 L. R. A. [N. S.] 368), in an opinion written by Mr. Justice Bibd, who quotes with approval from the opinion of Mr. Justice San-born, in McKinley v. Williams, 74 Fed. 94 (20 C. C. A. 312), to the effect that though the general rule as to the measure of damages for failure to- deliver ordinary personal property, according to a contract for-purchase and sale, or for its conversion, is the value of the property at the time it is to be delivered, or at the time it is converted (the act of conversion being on rightful demand wrongfully refused), nevertheless this general rule is subject to an exception in the case of shares of stock which are subject to frequent and wide fluctuations in value, and that the plaintiff should be permitted to recover the highest market value which the stock attains between the time of its conversion and the expiration of a reasonable time to enable the owner to put himself in statu quo after notice to him of the conversion. The case is so recent and so accessible that we content ourselves with this reference to it.

Counsel invoke section 28 of chapter 50 of Act No. 314, of the Public Acts of 1915, known as the judicature act (3 Comp. Laws 1915, § 13763), to sustain the judgment in this case upon the theory that no injustice has been done the defendant. If it is true, as claimed by the defendant, that plaintiff, by the expenditure of six or eight hundred dollars, within a reasonable time could have placed himself in statu quo, we do not think it can be said that a judgment in his favor of $3,500 is not an injustice.

For the reasons stated the judgment is reversed, with costs to the defendant, and a new trial ordered.

Ostrander, C. J., and Bird, Steere, Brooke, Fellows, Stone, and Kuhn, JJ., concurred.


source: Caselaw Access Project

author: Moore, J. Brooke, J.

license: Public Domain

text:
    GNAU v. FITZPATRICK.
    Deeds — Building Restrictions — Injunction—Equity.
    Where lots were sold with the restriction of a single dwelling with the necessary outbuildings on each lot, and as originally platted the lots were 60 feet wide, and plaintiff purchased one lot and 20 feet adjoining of another lot, and defendants purchased 50 feet each of the remaining 100 feet, of three lots, upon which they were proposing to build two houses, the plaintiff having already built one house upon his 80 feet, the effect being 'that there would be but three houses upon the three lots, there was no such violation of said restriction as would appeal to aj court of equity, in injunction proceedings to restrain de-” fendants from proceeding to build. Bird, Bkooke, and Kuhn, JJ., dissenting.
    See note in 45 L. R. A. (N. S.) 726.
    Appeal from Wayne; Codd, J.
    Submitted June 14, 1918.
    (Docket No. 97.)
    Decided September 27, 1918.
    Bill by George J. Gnau and others against Patrick Fitzpatrick and another to enjoin the violation of certain building restrictions. From a decree dismissing the bill, plaintiffs appeal.
    Affirmed.

      Monaghan, Monaghan, O’Brien & Crowley (Hinton E. Spalding, of counsel), for plaintiffs.

      McNamara & Scallen, for defendants.
   Moore, J.

The trial judge stated the questions involved in this litigation as follows:

“George J. Gnau and others, plaintiffs, all of whom are residents on Boston boulevard, east, filed their bill to enjoin defendants from proceeding with the con-, struction of two private dwellings on property situated on the southeast corner of Boston boulevard east and Brush streets, alleging that the erection of said homes were to be in violation of building restrictions imposed upon defendants’ property. This property is platted as part of McLaughlin and Owen subdivision, one-quarter section 37, 10,000-acre tract, Detroit.
“The subdivision was platted in 1893, and in 1898 the Park Hill Land Company, Ltd., a Michigan partnership association, became possessed of the property. Thereafter the lots were sold by said Park Hill Land Company and in each instance restrictions were incorporated, excepting that lot 11, which was conveyed by the Park Hill Land Company on January 6, 1899, did not contain the restrictions. Subsequently, however, on March 25, 1905, when this lot was again conveyed, the restriction was included. Consequently, although there is not a general restriction in its entirety, there is, at the present time, a restriction on each lot, not due to a general restriction against the entire street, but imposed at different times by different grantors. The terms of said restriction are fully set forth in plaintiffs’ bill.
“Defendants Patrick Fitzpatrick and William J. Ross acquired their property on the 19th day of July, 1917, from a common grantor, Earl I. Heenan, defendant Ross receiving a deed to the easterly 50 feet of lot 50 and defendant Fitzpatrick receiving a deed to the westerly 10 feet of lot 50 and the easterly 40 feet of lot 51. The remaining 20 feet of lot 51 or the westerly 20 feet of said lot is owned by plaintiff Gnau, together with lot 52 which joins lot 51 on the west.
“The plaintiffs claim that by reason of the fact that defendants each own 50 feet of ground instead of an entire lot as originally subdivided, the erection of their homes is in violation to the spirit and letter of the restrictions.
“The existence of the restriction and its terms is not disputed.
•“Plaintiffs contend that the words of the restric-. tion: ‘There shall be nothing but a single private dwelling with the necessary outbuildings erected on each lot,’ are to be construed to mean that an entire lot as originally subdivided comprises one building site only. It is my opinion that the above wording of restriction is merely to limit the number of structures that may be placed on a single lot, to distort the language of the restriction to conform with plaintiffs’ contention, it would be necessary to state it thus: ‘Nothing but a single lot shall be used for the erection of a private dwelling,’ etc. It is very apparent that this is an entirely different proposition.
“Plaintiffs further contend that plaintiff Gnau, by the purchase of 20 feet of lot 51, became the dominant owner, so to speak,' of the entire lot, and that in order for any one to deal in any way with the remainder of the lot, the consent of plaintiff Gnau must be secured. This court does not recognize any such doctrine and will not lend its aid in enforcing it. From the very nature of the restriction, in its unmistakable wording, it would be impossible for this theory to prevail, for in this case it would be possible for plaintiff Gnau by the purchasing of a minor portion of this valuable lot, to arbitrarily enjoin defendant Fitzpatrick owning the entire balance of said lot from the free use of its possession. This theory is not only unjustified in law, but contrary to public policy, as it would permit persons to dictate to the owner of large tracts of land by the purchase of a few feet or even less.
“It does not appear to me that there is any question as to the intent of the parties as to the meaning of the restrictive covenant. It was, as has been before stated, to limit the number of structures that an owner may place upon one lot. The clear and unmistakable language of the restriction controverts the possibility of any other intent. There are no limitations in the restriction as to the number of. feet necessary to build a residence on, nor does it say, as plaintiffs contend, that a full lot must be owned in its original state as subdivided by any one contemplating building. The language seems to me explicit and nothing can be written into a restriction or implied from the fact that plaintiff Gnau claims to have created one building site by procuring an additional 20 feet of lot 51 to add to his holdings. The testimony does not show that defendants’ plans will violate any.of the restrictions in this property. * * *
“There will be, after the defendants complete their private homes, but one single private dwelling on lot 51, and there will be but a single private dwelling on lot 50, which is strictly in accord with the terms and provisions of the restrictions. * * *
“A decree may be entered dismissing the bill of complaint for the foregoing reasons, with costs to be taxed.”

A decree was entered in accordance with the opinion. The case is brought here by appeal.

The restrictions applicable to the lots in the instant case read:

“In the block between John R and Brush streets, the building line shall be 45 feet back from the front lot line and no dwelling shall be nearer the front lot line than these limitations prescribe, and no dwelling or other structure shall be set nearer than 10 feet to the west lot line of any lot. * * *
“There shall be nothing but a single private dwelling with the necessary outbuildings erected upon each lot. * * * No residences less than two stories in height are permitted. The cost of residences to be erected on said lots shall be as follows: * * * for those between John R and Brush street, $6,500 or more * * * Provided, that more than one lot is purchased for a single homestead, the purchaser will not be required to erect more than one residence on said lots.”

We quote from the brief of the appellants:

“The plaintiffs contend that the defendants are violating both the letter and spirit of the restrictions imposed upon their land. • They are attempting to create two 50-foot lots. The plaintiffs urge that the defendants have attempted by this to create a subdivision of the original plat so far as it concerns their property, and thus create two building sites from what had originally been one building site and a fraction of another. If they are permitted to continue with their present plans, an effectual subversion of the original plan of improvement on the streets will necessarily result. * * *
“It is apparent from the building restrictions imposed upon this subdivision that the original owners of it planned to create a high-class residential district. They imposed the same restriction upon every lot on the street. We are stating an obvious fact when we say that uniformity is the first essential in creating a district of this type. The covenant contained in the various deeds requires uniformity in the front building line, prescribes, in a uniform way the nearest distance that the buildings can be placed from the west lot lines on the various lots and prescribes uniformity in the general quality and minimum cost of the residences to be erected. The entire purpose of the restriction is obvious from a mere reading of it.
“The meaning of the restriction is likewise free from doubt or ambiguity. The restriction provides that nothing but a single private dwelling with the necessary outbuildings can be erected upon each lot. The exact language of that part of the restriction to which we refer is as follows:
“ ‘There shall he nothing hut a single private dwelling with the necessary outbuildings erected upon each lot.’
“This can have but one meaning, namely, that an entire lot as shown upon the plat comprises one building site. A fraction of a lot of itself, therefore, would not constitute a building site. It is necessary therefore for a person who desires to possess a building site to acquire and own one full lot at least.”

In his oral argument it was the claim of counsel for the plaintiff that, if the owner of the middle lot of three lots acquired a small strip from the lots on each side of hinmhat the owners of the remaining portions of those two lots could not build on their lots without his consent, thus resulting in but one residence on three lots. If an observance of the spirit of the restrictions would bring out such a result we think it would prevent the owner'of a residence from buying a fractional part of a lot and that if he wanted more than one lot he should buy, not a fraction of a lot but a full lot. When defendants have done what they propose to do there will be but one residence on lot 50 and but one on lot 51. Neither residence will be within ten feet of the west line of the lot and will comply with the other restrictions.

The plaintiffs are in a court of equity. It does not appeal to our. sense of the province of that court to give them the relief they ask.

The decree of the lower court is affirmed, with costs.

Ostrander, C. J., and Steere, Fellows, and Stone, JJ., concurred with Moore, J.

Brooke, J.

(dissenting). I am unable to agree with the conclusions reached by my Brother MOORE' in this case. The essential provisions of the restrictions are that:

“No dwelling or other' structure shall be set nearer than ten feet to the west lot line of any lot,”
and that:
“There shall be nothing but a single private dwelling, with the necessary outbuildings, erected upon each lot.”

The defendant Fitzpatrick proposes to erect a dwelling house on a piece of ground made up of the easterly 40 feet of lot 51 and the westerly 10 feet of lot 50. Lots 50 and 51 are each platted 60 feet in width. There can be no doubt that it was the intention of those who created the restrictive covenant to provide .that not less than 60 feet should be occupied for each dwelling and its appurtenant structures. The fallacy of my Brother’s argument is apparent if we assume that Mr. Fitzpatrick had purchased none of lot 50 and only the easterly 30 feet of lot 51 and had attempted to erect upon that 30 feet his residence. In such case, as now, he would have satisfied the exact language of the restriction, according to the reasoning of my Brother, because his residence would be the only residence on lot 51 and would be more than 10 feet east of the westerly line of lot 51. It seems to me quite apparent that in such a case any court clothed with equitable jurisdiction would enjoin the defendant Fitzpatrick from proceeding. What he proposes to do now is, in principle, exactly what he would propose to do in the case supposed. He now proposes to use 50 feet for his residence instead of 30 feet in the supposed case, while the’platted lot is 60 feet wide. The paramount rule, for the construction of restrictive covenants is that effect shall be given to the actual intent of the parties, if that be possible, without doing violence to the language used. A restrictive covenant which recites that:

“There shall be nothing but a single private dwelling, with the necessary outbuildings, erected upon each lot,”

certainly cannot mean that a single private dwelling can be erected upon a strip of ground less than a lot as platted. The record contains abundant testimony to the effect that wide lots, affording opportunity for proper landscaping about residences, tend to increase the value of residential property, and that narrow lots, where the houses are built close together, tend to reduce such value. It is defendant Fitzpatrick’s intention to erect a structure within five feet of his westerly lot line, whereas the restrictive covenant is that:

“No dwelling or other structure shall be set nearer than ten feet to the west lot line of any lot.”

According to the reasoning of my Brother MOORE, Mr. Fitzpatrick satisfied this restriction^ by asserting that the westerly 20 feet of lot 50, which he does not own, but which is owned by the complainant Gnau, may be used by him in the computation. This, it seems to me, is manifestly inequitable.

Again, suppose that Mr. Fitzpatrick was the owner of the westerly 30 feet of lot 50 and the easterly 30 feet of lot 51 and desired to erect a building thereon. Construing the restrictive covenant that:

“No dwelling or other structure shall be set nearer than ten feet to the west lot line of any lot,”

as my Brother does, Mr. Fitzpatrick would be obliged to erect his dwelling ten feet east of the center line of the plot owned by him upon the easterly twenty feet of the lot, leaving 40 feet to the west unoccupied. The word “lot” in the restrictive covenant quoted should be held to mean the building site or premises about to be improved. Given this construction in the case at bar Mr. Fitzpatrick would be obliged to erect his house ten feet from the westerly line of the property owned by him. This he cannot do because his structure as at present planned reaches to the very easterly limit of the lot he owns.

The construction placed upon the restrictions by the other owners upon this street, none of whom have attempted to replat the lots and place residences on less than a single lot, has been uniform. While this construction may not be absolutely controlling, it should receive great weight in determining the true meaning of the covenant in question.

I am of the opinion that the injunction should issue as prayed.

Bird and Kuhn, JJ., concurred with Brooke, J.


author: Brooke, J.

text:
    BUVIA v. OSCAR DANIELS CO. BOISSINEAU v. SAME. CENNELL v. SAME.
    1. Master and Servant — Workmen’s Compensation Act — Personal Injuries — Out oe Employment — Course of Employment.
    In order to entitle the injured employee to compensation under the workmen’s compensation act, the injury must arise out of, as well as in the course of, the employment.
    2. Same.
    An injury arises out of the employment when there is apparent to the rational mind, upon consideration of all the circumstances, a causal connection between the conditions under which the work is reguired to be performed and the resulting injury.
    3. Same — Personal Injuries — Out of Employment.
    Where three employees, while waiting for a boat to leave, so that another boat from which they were to unload mixer wings could move up to its proper place at the dock, out of curiosity, walked over to where a city scavenger was dumping refuse into a hole in the dock, when dynamite caps mixed in with the rubbish exploded, killing one and injuring the other two, the accident did not arise out of their employment; their duty to their master neither reguiring nor warranting them in wandering from the scene of the contemplated operation.
    4. Same — Injury Peculiar to Employment.
    An injury to an employee resulting from a risk common to the general public is not covered by the workmen’s compensation act.
    See notes in L. R. A. 1916A, 23; L. R. A. 1917D, 80.
    Certiorari to Industrial Accident Board.
    Submitted June 5,1918.
    (Docket Nos. 27-29.)
    Decided September 27, 1918.
    Rehearing denied January 31, 1919.
    Frank Buvia, Joseph Boissineau and Belle Cennell, administratrix of the estate of Thomas Cennell, deceased, presented their claims for compensation against the Oscar Daniels Company for injuries and the accidental death of Thomas Cennell in defendant’s employ. From orders awarding compensation, defendaxit and the Employers’ Liability Assurance Corporation, insurer, bring certiorari.
    Reversed, and awards set aside.

      Davidson & Hudson (F. T. Witmire, of counsel), for appellants,

      Albert E. Sharpe, for appellees Cennell and Buvia.

      Wiley & Green, for appellee Boissineau.
    These three cases all grow out of the same accident in which Thomas Cennell, husband of Belle Cennell, claimant, lost his life and claimants Joseph Boissineau and Frank Buvia were injured. The three men were at the time of the accident employees of the Oscar Daniels Company. On ’May 15, 1917, the three men were directed to take 13 iron mixer wings, weighing about 140 pounds each, from the dock of the Oscar Daniels Company, on the Fourth Lock at Sault Ste. Marie, to Brady Pier on the river front, where the wings were to be'Unloaded. The next morning the three men loaded the mixer wings from the dock of the Oscar Daniels Company onto the deck of the launch, “Ralph T,” and proceeded to the Brady Pier on the river front for the purpose of unloading them. When they arrived at the pier they found that the United States buoy tender, “Clover,” was moored opposite the point on Brady Pier where the Oscar Daniels Company was permitted to unload heavy material for transportation. They moored the “Ralph T” a short distance behind or east of the “Clover,” but opposite the Brady Pier. This pier is built of concrete and is under control of the United States engineers’ department. Immediately to the east of Brady Pier and adjoining it is an old wooden dock. Whether when moored the launch, “Ralph T,” was wholly in front of the concrete pier or lay partially opposite the wooden dock is a matter somewhat in dispute in the record. For the purposes of determination, however, the divergence of the testimony upon this point is insignificant. Having moored their boat, Cennell, who was the owner of the “Ralph T,” ascertained by inquiry that the “Clover” would soon move out. He told the other two claimants that they would wait the 10 or 15 minutes until the “Clover” departed. While the three men were awaiting the departure of the “Clover” a city scavenger drove upon the wooden dock adjoining the Brady Pier and started to unload some rubbish through a hole in said dock at a point about 60 feet from the face of the dock and about 20 feet east of the east line of Brady Pier. The load of rubbish contained a large quantity of dynamite caps. The three men, apparently curious to, watch the dumping of the scavenger wagon, walked in the direction of the point where it was being unloaded and must have reached a point very close to the wagon when an explosion of great violence occurred, resulting in the death of one member of the United States coast guard, two employees of the city scavenger, and of Thomas Cennell, husband of Belle Cennell, and in the injury of claimants Buvia and Boissineau. Neither the Brady Pier nor the wooden dock adjoining was owned or controlled by the Oscar Daniels Company. Liability having been denied by the Oscar Daniels Company, a committee on arbitration heard the matter and rendered a decision in favor of all three claimants, which was later affirmed on appeal to the industrial accident board. Defendants now review said award's in this court.
   Brooke, J.

(after stating the facts). It is the contention of appellants:

1. That the injuries did not arise out of the employment.
■ 2. That such injuries did not arise in the course of the employment in which claimants were engaged.

We have frequently held that, in order to entitle the injured person to compensation under the act, the injury must arise out of the employment as well as in the course of the employment. Tarpper v. Weston-Mott Co., 200 Mich. 275, and cases cited. An injury arises out of the employment when there is apparent to the rational mind, upon consideration of all the circumstances, a causal connection between the conditions-under which the work is required to be performed and the resulting injury. McNicol’s Case, 215 Mass. 497 (102 N. E. 697, L. R. A. 1916A, 306). The injury must be the result of one of the risks incident to the employment. Applying these rules to the case under consideration, how can it be said that the employment of Cennell, Boissineau and Buvia subjected them to the risk of death or injury from which they suffered? Their duties required them to load the mixer wings from defendant’s dock on the Fourth Lock at Sault Ste. Marie and to transport them to Brady Pier and there unload them. Their duty to their master neither required them to, nor warranted them in, wandering from the immediate scene of the contemplated operation and gratifying an idle curiosity. The premises where the accident occurred, and where they had no business, were not under the control of their common master. The scavenger whose possible negligence caused the disaster was a municipal employee. We feel bound to determine therefore that the accident causing the injuries did not arise out of the employment. Assuming, however, that the presence of claimants in the vicinity of the scavenger’s wagon was justified, which cannot properly be done, then in suffering death and mutilation from the explosion the claimants were subjected to no greater or different risk than that sustained by every member of the general public within the zone of the blast. Three other persons were killed, one totally unconnected with the operation. An injury resulting from a risk common to the general public may not be compensated. Hopkins v. Sugar Co., 184 Mich. 87 (L. R. A. 1916A, 310); Worden v. Power Co., Mich. W. C. C., page 14, July 19, 1916. While the accident in the cases under consideration cannot be treated as. “an act of God,” as was the one considered in Klawinski v. Railway Co., 185 Mich. 646, the argument sustaining the decision in that case is a fortiori applicable here. See, also, Spooner v. Detroit Saturday Night Co., 187 Mich. 125. The two cases principally relied upon by claimants are Kunze v. Detroit Shade Tree Co., 192 Mich. 435, and Haller v. City of Lansing, 195 Mich. 753. Neither is controlling or applicable to the facts in the cases under consideration. In the first case the claimant was injured while in the actual performance of his duties and in the second case the claimant was injured while within the ambit of his employment, actually upon his master’s premises, and using such facilities as his master had provided.

The awards are set aside.

Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred.


text:
    HAMBURGER v. BERMAN.
    1. Exchange of Property — Fraud—Estoppel—Breach of Contract.
    Where defendant dealt with property, received in an exchange of property, after discovering plaintiff’s alleged false representations relating thereto, his conduct amounted to an affirmance of the contract, and the defense of fraud is not open to him in an action for its breach.
    2. Same — Contracts—Values—Damages.
    Where an exchange of properties was contracted for, held, the values fixed in the contract by the respective parties upon the properties were mere estimates, and were so fixed merely for the purpose of effecting an exchange.
    3. Same — Breach of Contract — Liability.
    Where defendant contracted to convey certain property, the legal title to which was in a corporation of which he was a minority stockholder, in exchange for other property, he was liable in an action for breach of the contract, on his failure to convey.
    4. Same — Damages—Values as to Date of Breach.
    The true measure of plaintiff’s damages was the amount lost through the failure of defendant to carry out his contract; the loss to be ascertained as of the date of the breach.

    5. Same — Damages—Instructions—Trial.
    Where the court instructed the jury, -on the question of damages, that they were to be governed by the evidence, and the witnesses had testified as to the values of the respective properties at or near the time of the breach, the failure of the court to instruct the jury to determine the values as of the date of the breach was not reversible error, in the absence of any preferred request upon that point.
    Error to Wayne; Gilday, J., presiding.
    Submitted June 4, 1918.
    (Docket No. 8.)
    Decided September 27, 1918.
    Rehearing denied January 31, 1919.
    Assumpsit by Harry B. Hamburger against Julius Berman for breach of a contract to exchange certain real estate. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Robert M. Brownson, for appellant.

      Butzel & Butzel (Isadore Levin, of counsel), for appellee.
    Plaintiff brought suit to recover damages alleged by him to have been sustained by reason of the breach by the defendant of the following contract:
    “Memorandum of agreement, made and entered into this first day of September, in the year one thousand nine hundred and fifteen, by and between Julius Berman of the city of Detroit, county of Wayne, and State of Michigan, as party of the first part, and Harry B. Hamburger of the same place, as party of the second part, witnesseth:
    “In mutual consideration of the sum of one ($1.00), dollar to each of the parties hereto respectively paid by the other party, and in consideration of the terms and covenants herein contained, it is hereby agreed as follows:
    “The said party of the first part hereby agrees to sell and convey unto the party of the second part the property situated on the northwest corner of Fort street west and Hubbard, street, in the city of Detroit, county of Wayne and State of Michigan, same consisting of a three-story brick building and. lot having dimensions of approximately one hundred (100) by one hundred and twenty-five (125), for the sum of thirty-six thousand ($36,000.00) dollars, payable as follows:
    “By the said party of the second part conveying unto the said party of the first part the property situated at and commonly known as numbers 165, 167 and 169 Benton street, in the said city of Detroit, county of Wayne and State of Michigan, consisting of one brick building and two frame houses and lot having dimensions of approximately fifty-seven (57) feet by ninety-five '(95) feet subject to an existing mortgage on same of four thousand ($4,000) dollars.
    “The said party of the first part hereby agrees to accept the conveyance of the said Benton street property upon the basis of the valuation of twenty thousand ($20,000.00) dollars, giving the said party of the second part credit for the sum of sixteen thousand ($16,000.00) dollars, at which time the said party of the first part will execute and deliver unto the said party of the second part a warranty deed to said Fort and I-Iubbard property, free and clear of and from all liens and encumbrances, excepting a certain mortgage thereon in the sum of twenty thousand ($20,-000.00) dollars, which mortgage has about five (5) years to run, without any intermediate payments to be made on the principal of said mortgage, until due. Said mortgage bearing interest at 6% per annum, which interest is to be paid semi-annually.
    “And it is agreed that upon the delivery to said second party of the warranty deed above mentioned, the said second party will assume the said mortgage and agree to pay the same. Upon the execution and delivery of said warranty deed the said party of the second part agrees to execute and deliver unto the said party of the first part a warranty deed to the said Benton street property, subject to said mortgage of four thousand ($4,000.00) dollars which mortgage the said party of the first part agrees to assume and pay.
    “The respective parties hereto are to furnish Burton or Union Trust abstract of title, certified to date forthwith, showing the said properties to be free and clear of and from all liens and encumbrances whatsoever, excepting as aforesaid. The deal to be closed and said warranty deeds to be executed and delivered within one (1) week after the said abstracts of title are delivered by the respective parties hereto.
    “Possession of the respective premises to be delivered at- the time the said deal is closed.
    “In witness whereof, the parties hereto have nereunto set their hands and seals at the city of Detroit, this day and year first above written.
    “Julius Berman, (L. S.)
    “H. B. Hamburger.” (L. S.)
    Defendant gave notice under the plea of the general issue that he would prove that his signature to said contract was secured through fraud and misrepresentation on the part of the plaintiff. It appears that the so-called Fort street property which defendant negotiated to exchange with plaintiff for the Benton street property belonged in fact to a corporation known as the Suburban Land Company, one-third of the stock of which belonged to defendant, one-third to one Marshall and one-third to one Dwyer, at the time of its incorporation. At the time of the trial there were two or three .other stockholders. The legal title to the Fort street property stood in the name of Elon J. Dwyer, though it was conceded upon all sides that it belonged to the corporation. The same evening, after the contract in suit was executed, defendant met Marshall, who with himself and Dwyer controlled the corporation owning the Fort street property, and was advised by Marshall that the plaintiff had overreached him in the deal and that he, Marshall, would not consent to going forward with the trade. Dwyer took the same attitude. Defendant had lived in the neighborhood of the Benton street property for many years and was acquainted with it. He made a more particular examination of it on the morning after the execution of the contract and claims to have then discovered that plaintiff had misrepresented certain facts in connection therewith to him. He, however, did not at that time notify plaintiff that he had been induced to enter into the contract by fraud, and would for that reason refuse to consummate it, neither did he notify him that his associates and co-owners, Marshall and Dwyer, refused to consummate the deal. On the contrary, he permitted plaintiff to have his abstract of title brought down to date and went with plaintiff to his attorney where deeds were prepared effecting the exchange. Defendant was unable, however, to persuade his associates to execute a deed of the Fort street property, and then set out to effect a sale of the Benton street property to other parties. He entered into a written contract on the 4th of September for the sale of the Benton street property for the sum of $18,500. This deal finally fell through because defendant Berman was not satisfied with the contracts the purchaser was to turn over to him for his equity in the Benton street property. In the following weeks he made further efforts to sell the Benton street property and did not finally repudiate his obligations under the contract in suit until September 25, 1915. Evidence was offered on behalf of both plaintiff and defendant touching the value of the equity in each of the properties, the subject of the exchange, and a verdict was directed by the court in favor of the plaintiff, the jury being instructed that the only question open for their determination was the amount of damages suffered by the plaintiff.' The court held that defendant, Berman, by dealing with the Benton street property and offering it for sale after he had discovered the alleged fraudulent representations made to him by plaintiff, must be held to have affirmed the contract and that the defense of fraud was not open to him. The jury rendered a verdict in favor of the plaintiff for $2,500.

      See note in 38 L. R. A. (N. S.) 465.

   Brooke, J.

(after stating the fads). We are of opinion that the court was correct in holding that defendant by his dealings with the Benton street property, after his discovery of the alleged fraudulent representations, precluded himself from interposing the defense of fraud, his conduct amounting to an affirmance of the contract. Foster v. Rowley, 110 Mich. 63, and cases cited. All of defendant’s requests were addressed to the question of alleged fraudulent representations made by plaintiff and to the question of plaintiff’s good faith in entering into the contract. No request on behalf of the defendant was preferred upon the question of the measure of damages. Upon that point the court instructed the jury as follows:

“So, gentlemen of the jury, it then comes down to a question of the value of the property. It is for you to determine, therefore, what damages the plaintiff has sustained, if any, by reason of the entering into of this contract. To ascertain and determine that you are to use your judgment from the evidence in the case, the evidence that has been introduced upon the trial of the case as to the value of the respective' pieces of property. In determining this, it is your duty to determine it by a .preponderance of the evidence ; that is, by the weight of the evidence. As to both the value of the Fort street property and of the Benton street property. After having ascertained and determined by a preponderance of the evidence' the value of each piece of property, you are then to deduct from the value, for instance, on the Fort street property, the amount of the’ mortgage on that- property, and from the Benton street property the amount of the mortgage that is on that property, and the difference would be the amount of the damages which plaintiff claims to have sustained in this case. You are to arrive at the damages in that manner.”

Error is assigned upon this portion of the charge, it being the contention of the defendant that under the contract the transaction amounted to a sale at a fixed price and that the plaintiff, by bringing suit on the contract, thereby ratified and affirmed all of its terms and provisions including the valuation of $20,-000 (subject to a mortgage of $4,000) which he himself placed upon the Benton street property. Under this argument it is contended that:

“Plaintiff cannot now recover substantial damages for the fancied goodness of his bargain by repudiating the very material and binding contract provision as to the agreed value of his equity ($16,000.00), by claiming a substantial diminution thereof within a few days after the execution of this agreement.”

It is further urged on behalf of the defendant that the question of good or bad faith of defendant should have been submitted, citing Hammond v. Hannin, 21 Mich. 374, and Way v. Root, 174 Mich. 418.

We are of opinion that the contract in essence ..amounts to an agreement for the exchange of two properties. The values fixed by the respective parties upon the properties were mere estimates and were so fixed merely for the purpose of effecting an exchange. Defendant’s evidence upon the question leaves no .doubt that this is what was in the minds of the parties at the time the contract was made. We are further of opinion that the situation of the defendant is not like that considered in Hammond v. Hannin, supra, but rather is governed by the case of Dikeman v. Arnold, 78 Mich. 455. The rule as stated in 2 Sutherland on Damages (4th Ed.), page 1988, is as follows:

“If the person selling is in default — if he knew or should have known that he could not comply with his undertaking; if he, being an agent, contracted in his own name, depending on his principal to fulfill his contract merely because he had power to negotiate a sale; if he has only a contract of the owner to convey, or a bond for a deed; if his contract to sell requires the signature of his wife to bar an inchoate right of dower, or the consent of a third, person to render his deed effectual; if he makes his contract without title in the expectation of subsequently being able to acquire it and is unable to fulfill by reason of causes so known, as the want of concurrence of other persons, or if he has title and refuses to convey, or disables himself from doing so by conveyance to another person — in all such cases he is beyond the reach of the principles of Flureau v. Thornhill, 2 W. Bl. 1078, and is liable to full compensatory damages, including those for the loss of the bargain.”

In the case at bar the defendant, when he entered into the contract in suit, knew that the legal title to the Fort street property stood in the name of Dwyer and that the property was actually owned by a corporation in which he was a minority stockholder. Nevertheless, by the execution of the contract, he undertook to convey the same. The true measure of plaintiff’s damages was the amount lost through the failure of defendant to carry out his contract, said loss to be ascertained as of the date of the breach. It is urged on behalf of the defendant that nowhere in the charge of the court are the jury instructed to determine the values of the several properties as of the date of the breach. As before stated, however, no request upon that point was preferred on behalf of the defendant and it' clearly appears from an examination of the record that all of the witnesses examined as to value, testified to values at or near the time of the breach. We do not think the jury could have been misled by the charge of the court or that the case should be reversed because more specific instructions were not given.

The judgment is affirmed.

Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred.


text:
    VEREEKE v. CITY OF GRAND RAPIDS.
    1. Master and Servant — Workmen’s Compensation Act — In« jured Employee — Election of Remedies.
    Under section 15, part 3, of the workmen’s compensation act (2 Comp. Laws 1915, § 5468), an injured employee must make an election; and he cannot proceed against his employer for compensation and also against a third party, the wrongdoer, for damages.

      2. Same — Right of Action Against Wrongdoer Conferred Upon Employer.
    Under the same section, when an employer pays compensation he is empowered to recover such sums as he pays from the wrongdoer for his own benefit.
    3. Same — Release of Employer from Action at Law — Wrongdoer Not Released from Action by Administrator.
    But the only limitation under said act upon the right of a dependent who accepts compensation from an employer is to release said employer from all claims or demands at law, if any, arising from such injury; and it cannot be contended that a dependent, by accepting compensation from an employer, thereby releases the wrongdoer from liability in an action for the benefit of. heirs at law or creditors of a deceased employee.
    4. Same — Dependent’s Award Not Affected bt Administrator’s Suit.
    Where a city employee was accidentally killed, 'and the mother made a claim and was awarded compensation as a dependent under the workmen’s compensation act, thereby clothing the city with a right of action against the wrongdoer, and the city failed to prosecute its right of , action under section 15, part 3, of said act, it could not, by petition to the industrial accident board, hate credited upon the award against it any sums received by the mother as a result of a suit brought by the administrator of the deceased son’s estate against the wrongdoer. •
    Certiorari to Industrial Accident Board.
    Submitted June 13, 1918.
    (Docket No. 44.)
    Decided September 27, 1918.
    Kate Vereeke presented her claim for compensation against.the city"of Grand Rapids for the accidental death of her son in defendant’s employ. On petition of defendant to discontinue payments under an award. From an order denying the petition, defendant brings certiorari.
    Affirmed.

      Gamón Taggart, City Attorney, and Charles A. Watt, Deputy City Attorney, for appellant.

      John J. McKenna, for appellee.
    Certiorari to the industrial accident board. On October 1, 1913, David Vereeke was killed while in the employ of the city of Grand. Rapids. On the 5th day of March, 1914, his mother, claimant herein, entered into a stipulation with the city touching the amount earned by her son and the amount contributed to her. Based upon this stipulation the industrial accident board awarded claimant the sum of $6 a week for a period of 300 weeks. She removed the case to this court for review where it was affirmed. Vereeke v. City of Grand Rapids, 184 Mich. 474. In the meantime a petition had been filed in the probate court by Cornelius Vereeke, father of David, asking for the appointment of himself as the administrator of' his son’s estate. Such appointment was opposed by Kate Vereeke, claimant herein, and as a result one Frank D. McKay was appointed as such administrator. Said McKay entered into a written contract with the attorneys of Cornelius Vereeke and with the attorneys of Kate Vereeke by the terms of which they were to bring a suit at law against the Grand Rapids-Muskegon Power Co. under the survival act for the purpose of recovering damages on account of the alleged negligent killing of David Vereeke. By said contract it was provided that 50 per cent, of any recovery should be paid to the attorneys representing the administrator, one-half to the attorneys of Kate. This suit proceeded until October 5, 1915, when it was adjusted with the consent of the judge of probate for the sum of $2,050, which was on that date paid by the Grand Rapids-Muskegon Power Co. to the administrator. Of this sum the administrator paid to the attorneys as per his contract the sum of $1,000. Various other disbursements, including his own compensation, reduced the balance to $963.95. Both Cornelius and Kate laid claim to this sum. The probate court made an order assigning one-half to Cornelius and one-half to Kate. This order was affirmed in the circuit court on appeal and Kate Vereeke, claimant herein, received as her share thereof the sum of $481.92. While the matter was pending in the circuit court on appeal the city of Grand Rapids filed a petition in the circuit court for leave to intervene, but later failed to prosecute its claim to said fund or any part thereof. After the same had been paid to the claimant, Kate, the city of Grand Rapids filed a petition with the industrial accident board in which it prayed that it be authorized to cease payment to the said Kate Vereéke as in said order required and further that the city be allowed a credit on the amount awarded to said Kate Vereeke on the order heretofore made to the amount of one-half of said sum of $2,050 paid by the Grand RapidsMuskegon Power Co. to Vereeke’s administrator as aforesaid and by him paid to Kate Vereeke. This petition was answered by the claimant herein and a hearing had thereon before the industrial accident board. It was there made to appear that the city had paid to Kate Vereeke on the order of the board the sum of $1,230 and further facts substantially as above set forth were brought out. The board denied relief under the petition and its determination is now reviewed in this proceeding.

      See note in L. R. A. 1916A, 72.

   Brooke, J.

(after staling the facts)'. Section 15 of part 3 of the workmen’s compensation law (2 Comp. Laws 1915, § 5468) provides:

“Where the injury for which compensation is payable under this act was caused under circumstances creating a legal liability in some person other than the employer to pay damages in respect thereof, the employee may at his option proceed either at law against that person to recover damages, or against the employer for compensation under this act, but not against both,' and if compensation be paid under this act the employer may enforce for his benefit or for that of the insurance company carrying such risk, or the commissioner of insurance, as the case may be, the liability of such other person.”

Section 1 of part 6 of said law (2 Comp. Laws 1915, § 5488) reads as follows:

“If the employee, or his dependents, in case of his death, of any employer subject to the provisions of this act files any claim with, of accepts any payment from such employer, or any insurance company carrying such risks, or from the commissioner of insurance on account of personal injury, or makes any agreement, or submits any question to arbitration under this act, such action shall constitute a release to such employer of all claims or demands at law, if any, arising from such injury.”

Under these two sections it is the claim of defendant city that the industrial accident board was in error in permitting claimant to retain the sum received by her in settlement of the suit at law against the Grand Rapids-Muskegon Power Co. and at the same time compel it, the defendant city, to continue payments to claimant as compensation under the act. This it is said amounts to double compensation to the claimant and should not be permitted. It is true that under section 15 of part 3 above quoted, the employee himself must make an election and cannot proceed against his employer for compensation and against a third party, the wrongdoer, for damages, and it is equally true that when the employer pays compensation he is empowered under the same section to recover such sums as he pays from the wrongdoer for his own benefit. Neither the section under, consideration, however, nor section 1 of part 6 (2 Comp. Laws 1915, § 5488) contains any limitation upon the rights of dependents except that, under section 1 of part 6, a dependent who accepts compensation from an employer releases to said employer all claims or demands at law, if any, arising from such injury. We think it cannot be contended that Kate Vereeke, by accepting compensation from the city of Grand Rapids, thereby released the Grand Rapids-Muskegon Power Co., the alleged wrongdoer, from liability in an action for the benefit of heirs at law or creditors of David Vereeke. By making a claim for compensation against the employer, the defendant city, she clothed that employer under the terms of section '15, part 3 (2 Comp. Laws 1915, § 5468), with a right of action against the wrongdoer. Had that right of action been prosecuted by the city recovery thereupon would certainly have been taken into consideration in awarding damages in a suit instituted by the administrator of the estate against the alleged wrongdoer. Having failed to protect its rights in the manner pointed out by the statute we are of opinion that the appellant city cannot now by petition to the industrial accident board have credited upon the award against it any sums received by Kate Vereeke as a result of the suit against the power company.

Judgment must be affirmed.

Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred.


text:
    NORRIS v. HOME CITY LODGE NO. 536, INDEPENDENT ORDER OF ODD FELLOWS.
    1. Fraud — Vendor and Purchaser — Options—Price.
    It was fraud for the holder of an option on real property to represent to prospective purchasers that he was the agent of the owner, and that the lowest cash price the owner would accept for the land was' $15,000, when in fact he was not the agent of the owner, and the option fixed the price at $11,000.
    2. Same — Damages—Injury.
    In order to furnish ground for judicial action, fraud and injury must concur.

      3. Trial — Defenses—Inconsistent Defenses — Variance.
    It was error for the court below to submit to the jury two inconsistent and contrary defenses, one of which was neither alleged in the pleadings nor supported by the evidence.
    4. Fraud — Issues—Value of Land — Damages.
    Where the defense to an action on a promissory note given as part of the purchase price of a piece of land was that plaintiff had fraudulently misrepresented to defendants the price which the owner was willing to take for the land, the question of the value of the land was immaterial.
    5. Same — Trial—Instructions—Failure to Call Witnesses.
    Where the theory of the defense was that two of the defendants, who had also signed the note, had conspired with plaintiff to deceive and mislead the other defendants, an instruction that plaintiff’s failure to call the two defendants to the witness stand might be regarded by the jury as a badge of fraud unless explained, was error.
    6. Bills and Notes — Inability—Trial.
    Where a note sued upon was not signed by corporate defendants, an instruction by the court that they could not be held liable was correct.
    Error to Jackson; Parkinson, J.
    Submitted June 6, 1918.
    (Docket No. 48.)
    Decided September 27, 1918.
    Assumpsit by Michael D. Norris against Home City Lodge No. 536, Independent Order of Odd Fellows, and others, on a promissory note. Judgment for defendants. Plaintiff brings error.
    Reversed.

      Price & Whiting, for appellant.

      B. E. Brower {W. S. Cobb, of counsel), for appellees'.
    In this case plaintiff sought to recover $2,000 and interest upon the following note:
    “$2,000. Jackson, Mich., May 17, 1912.
    “Ninety days ' from date, for value received we promise to pay Michael D. Norris or bearer, the sum of two thousand dollars, with interest at six per cent, per annum, payable annually after August 17, 1912.
    “Temple Committee Home City Lodge I. O. O. F. NO. 536.
    “A. L. Fellows, Pres.
    “Jas. Gilmore, Sec.
    “Fred C. Logeman, V. P.
    “E. -W. Dunfee,
    “Warren O. Newton, “Ernest T. Harper,
    “M. S. Lutz.”
    Two of the signers of the note, Fellows and Loge-man, failed to appear and were defaulted. A plea of the general issue was interposed by the other defendants under which they gave notice that they would show that the note in question was given as a part of the purchase price of a eertain piece of real estate in the city of Jackson upon which was to be erected an Odd Fellows temple; that they were induced to execute said note by false and fraudulent representations on the part of the plaintiff. These representations consisted in plaintiff asserting:
    1. That he wasNhe-.agent-of-the- Fred. Miller..Brewing Co., the owner of the property.
    2. "That the lowest cash price .said brewing .^company would' accept for said property was $15,000.
    They aver that both said representations were false; that the Fred Miller Brewing Company had fixed a price of $11,000, and that plaintiff had an option thereon for a period of 60 days at said sum, then unexpired/ and that he himself wrongfully and fraudulently fixed the price of $15,000; that to accomplish said sale plaintiff entered into a fraudulent conspiracy with defendants Fellows and Logeman, who were members of temple association and Home City Lodge No. 536, and through them induced defendants to believe the alleged false and fraudulent representations aforesaid.
    On May 13, 1912, the Fred Miller Brewing Co. deeded the property in question to plaintiff, Norris, the consideration named being $11,000. On May 17, 1912, plaintiff deeded the same property to one Chas. H. Ruhl, and on the same date said Ruhl sold the same upon land contract to the Home City Lodge No. 536, the consideration named being $8,000. It is apparent that the defendant lodge paid the plaintiff Norris $7,-000 of the purchase price at the time of the execution of the contract. In this sum was included the $2,000 note in suit. At no time after the discovery of the alleged fraudulent representations made by plaintiff did defendants, or either of them, tender back to plaintiff, Norris, the property in question. The corporate defendant purchasing the property has paid approximately one-half of the purchase price and continues in possession. Under the plea of the general issue there was no notice of recoupment. The case was submitted to a jury under a very exhaustive charge and the jury returned a verdict of no cause of action.
   Brooke, J.

(after stating the facts). A careful perusal of this record convinces us that there was an abundance of evidence tending to show that plaintiff represented to the purchasing committee, who after-wards signed the note in question, that he was acting in the transaction as the agent of the brewing company, indeed, he executed the following receipt:

“$100.00. April 20, 1912.
“Received from Alva Fellows for I. O. O. F. 536, One Hundred Dollars, as payment on Miller Brewing Co. property, balance to be paid on or before May 10th, 1912.
“Purchase price $15,000.
“M. D. Norris, Agent.
“For Fred Miller Brewing Co.”

—in which he so described himself. There is further evidence to the effect that he represented that the sum of $15,000 was the lowest cash price which the brewing company would accept for the property. It is clear upon the face of the record that both of these representations, if made, were false.

It is the primary contention of plaintiff in this court that the defendants were not entitled, under the pleadings and proof, to have their alleged defenses of fraud and misrepresentation, submitted to the jury and that a verdict should have been directed in his favor. This contention is based upon the theory that defendants could not interpose their defenses of fraud unless they could show that the fraudulent representations resorted to by plaintiff induced them to act to their injury; in other words, that defendants upon discovery of the alleged fraud should have rescinded, and having neither rescinded nor shown upon the trial that the property was in fact worth less than the $15,000 paid therefor they are not entitled to interpose the defenses of fraud in this action upon the note. It is asserted that fraud and injury must concur in order to furnish ground for judicial action, citing Elliott on Contracts, §§ 71-91. The soundness of this legal principle is not questioned, but its applicability to this case is denied, under the following authorities: Barnard v. Colwell, 39 Mich. 215; Hidey v. Swan, 111 Mich. 161; Hokanson v. Oatman, 165 Mich. 512 (35 L. R. A. [N. S.] 423); McGough v. Hopkins, 172 Mich. 580. The controlling facts of these several cases are so nearly like the facts in the case at bar, as found by the jury, as to render them indistinguishable upon principle.

Error is assigned upon the following excerpt from the charge of the court:

“It was the duty of Fellows and Logeman, and each of them, as members of the committee appointed for the purpose of purchasing a site for a temple, to act in good faith toward the lodge and other members of the committee, and to aid in purchasing the property in question at the lowest possible price, and if you believe from the testimony and from the circumstances and facts shown in evidence that Fellows and Loge-man, or either of them, had any understanding or agreement with the plaintiff whereby they or either of them was to conceal from the other members of the committee the fact that plaintiff had an option on the property, or that he was to profit to the extent of $4,000 or any other sum by the sale thereof, or that they, said Fellows and Logeman, or either of them, would, by suggestion, argument, persuasion or other means, influence the other members of the committee or the lodge in the purchase of this property, or that they would by any other means whatever aid or assist in bringing about this sale and purchase without disclosing such knowledge, but should suppress it, then I instruct you that plaintiff in this case cannot recover and your verdict must be for the defendants.
“These defendants also claim that even if the charge of conspiracy is not sustained to your satisfaction that plaintiff Norris was himself guilty of such fraud, fraudulent statements or assent to false and fraudulent statements made in his presence and in aid of furtherance of his purposes and expressly or impliedly Assented to by him as sustains the charge of fraudulent conduct on his part whereby these defendants are relieved from their contract as makers of this note.
“Among these it is claimed by the defendants that, Norris concealed from them the fact he was acting for himself in bargaining for the sale of the property, and also falsely represented to them that he was acting as agent of the Fred Miller Brewing Company in making the sale; that he falsely represented $15,000 was the lowest cash price of that company for the property; that on the contrary he was acting, at least in part, for himself; that $15,000 was not the price of that company but was the price fixed by himself and $4,000 in excess of the company’s price; that he thereby forestalled any inquiry by defendants as to his real connection with the deal, or misled them or put them off the track of inquiring as to his personal interest in it, or the real price that the company was willing to take, and that defendants were thereby led to believe and did believe the property belonged to such brewing company, and so believing they dealt in relation to it as wholly belonging to that company without knowledge of the claimed rights or interests of Norris, and being deceived so assented to its acquisition by the lodge and so made the note in question, not knowing they were paying but $11,000 to the brewing company and $4,000 to Norris, and which they claim had they known these facts they would not have done, but that they were wholly deceived and defrauded. * * *
“If Fellows and Logeman were not deceived by Norris and were not wrongfully and intentionally cooperating with him or conspiring with him, as it has been termed, and were not, or either of them, making any false statements or representations by Norris’ procurement or connivance, then Norris is not responsible for what they or either of them said or did to help on the deal, unless there were misstatements calculated to mislead or deceive made by one or the other or both of them in his presence and hearing and not corrected by him. * * *
“But, if there was a design on his part or on the part of Fellows, or Fellows, Logeman, and Norris, acting in concert, not to let the others know for fear it might defeat or interfere with the deal, or affect the price to be paid, or for any other reason of personal advantage to Norris or to Norris and these two men or either of them, and for these reasons they did not communicate their knowledge to the other members of the committee or Norris did not communicate it, then such concealment would be unlawful and fraudulent.
“But, if Norris did mislead Fellows, or Fellows and Logeman, and they in turn, even though innocently, misled their associates or the temple association, believing what Norris had told them, and in consequence of their being so misled the deal was consummated under such misapprehension and in consequence of it, and'Norris knew of it, but remained silent, he would be responsible for that and that would be fraud. * * *
“Did Norris in this transaction, acting alone or wrongfully aided by Fellows or Logeman or both, act and talk in carrying on the negotiations so as to lead the defendants to believe, intending they should believe, and so they did in consequence believe, that 315,000 must be paid to the Fred Miller Brewing Company for this property in question, and pursuant to that belief created in their minds by Norris, intentionally, did they assent to the acquisition of the temple property and as part of the consideration execute this note sued upon in consequence bf this belief and the further representation that it was to pay Norris for advancing a like amount of $2,000 to the brewing company to complete payment of the purchase price of $15,000, and were they deceived and misled by this? If so, plaintiff cannot recover and your verdict must be no cause for action. * * *
“To what extent and in what respects, if any at all, Norris, or Fellows and Logeman, if wrongfully conspiring with Norris, made false statements and the extent of the deception, if any, are for you to determine, and the effect or result of these false statements on the minds and consequent action of these five defendants, if any such were made, whether they were deceived to their injury or not, is all for your determination.”

The criticism as to this portion of the charge is that it submitted to the jury two inconsistent and contrary defenses, one of which was absolutely unsupported by evidence. It is pointed out that neither in the pleadings nor the proofs did defendants attempt to show that Fellows and Logeman were themselves deceived by plaintiff, but it is asserted that the averments of the notice under the plea, and the evidence introduced tend to support the conclusion that plaintiff conspired with Fellows and Logeman to deceive the other members of the purchasing committee. We are of opinion that the charge upon this point is justly open to criticism. Way v. Root, 174 Mich. 418, and Remer v. Goul, 185 Mich. 371.

The court further charged the jury that:

“It would make no difference if defendants believed the property they acquired was actually worth $15,-000, or that it was in fact worth $15,000. It is as regards this case wholly immaterial if the property was actually worth $15,000.”

Error is assigned upon this portion of the charge. Under the authorities first above cited we think the question of the value of the property is immaterial to thé issue. The court further charged:

"Neither Fellows nor Logeman has been produced here to testify. They reside in this city, are business men, are accused by defendants as being concerned with Norris in perpetrating the fraud charged. Under such circumstances you have the right to consider this and assume that if they had been produced and sworn they could not or would not have been of' assistance to plaintiff. And as no reason has been shown for not producing them, they being familiar with the transaction as well as interested parties and being within reach of the process of the court, you have the right to regard this as a badge of fraud, unless such failure to produce them is explained.”

We think this instruction erroneous. We have been cited to no authorities justifying it. Fellows and Logeman were two of the makers of the note in suit and were named as defendants. The fact that they had been charged by their fellow defendants with having joined the plaintiff in a fraudulent conspiracy does not in our opinion warrant the instruction that plaintiff’s failure to call them to the witness stand might be regarded .as a badge of fraud.

Error is assigned upon the instruction of the court that the corporate defendants could not be held liable. We think this instruction correct. The note in suit was not signed by either corporate defendant. Error is assigned upon rulings of the court touching the admission or exclusion of testimony. We find no reversible error therein.

For the reasons stated the judgment must be reversed, with costs, and a new trial ordered.

Osteandee, C. X, and Bird, Mooee, Steeee, Fellows, Stone, and Kuhn, XX, concurred.


text:
    GRAND RAPIDS & INDIANA RAILWAY CO. v. ALLEGAN CIRCUIT JUDGE.
    1. Certiorari — Additional Writs — Jurisdiction—Discretion.
    In the exercise of a sound discretion, the circuit judge should have directed the issuance of additional writs of certiorari directed to the probate judge and the special commissioners before whom certain drain proceedings were heard, to return the records and proceedings therein, where, in their return to the writ of certiorari removing said proceedings to the circuit court for review, the county drain commissioners, against whom the writ was directed, returned that they were unable to say as to the correctness of attached copies of said proceedings, and that the only persons who might return the same or answer as to the correctness would be the judge of said probate court and such special commissioners.

      2. Same — Limitation of Actions — New Parties.
    Where plaintiff acted seasonably and within the ten days limited by the statute (section 4908, 1 Comp. Laws 1915), to secure a review in the circuit court of the proceedings, additional writs should issue as a matter of course, even after the expiration of the time limited by the statute; section 12364, 3 Comp. Laws 1915, providing that new parties may be added at any stage of the cause, as the ends of justice may require.
    Mandamus by the Grand Rapids & Indiana Railway Company to compel Orien S. Cross, circuit judge of Allegan county, to vacate an order denying a motion for additional writs of certiorari in certáin drain proceedings.
    Submitted June 18, 1918.
    (Calendar No. 28,149.)
    Writ granted September 27, 1918.

      James H. Campbell (Elvert M. Davis, of counsel), for plaintiff.

      Charles Them, for defendant.
    This is an application for mandamus to compel the vacation of an order of the circuit judge denying a motion to issue additional writs of certiorari to review proceedings for cleaning out, deepening, and extending the Bisbee drain. The record discloses that on May 24, 1917, the drain commissioners of Allegan county and Kent county made a final order of determination in connection with the cleaning out, deepening, and extending of said Bisbee drain. Prior to said date and on April 18, 1917, three special commissioners appointed by the probate court made a return in writing that a public necessity existed for the cleaning out, deepening, and extending of said drain; that it was necessary to take the property of the railway company described in the petition for such purpose and awarding the railway company the sum of $600 as compensation. On June 2, 1917, and within ten days from the date of the filing of the final order of determination the railway company served notice upon the drain commissioners that it intended to remove said proceeding to the circuit court for the county of Allegan by writ of certiorari for the purpose of review and on the same day presented to a circuit court commissioner for Allegan county an affidavit for writ of certiorari accompanied by the statutory bond. The writ was allowed on the same day, June 2, 1917, by said circuit court commissioner, attested in the name of the circuit judge for Allegan county; directed to and served upon the drain commissioner for Allegan county and the drain commissioner for Kent county. By said writ said officials were commanded to certify to the circuit court the records and proceedings in connection with said drain proceeding. The writ recites that the affidavit for the writ has attached to it certified copies of the testimony taken before the probate court and before the special commissioners. The drain commissioners are therefore excused from making service of a copy of such testimony. To this writ the drain commissioners of the two counties concerned made full returns. Referring to the testimony taken before the judge of probate and before the special commissioners, the return of the drain commissioners is to the effect that they cannot say as to the correctness of such certified copies, and aver that the only parties who might return the same or answer to the correctness of the same would be the judge of said probate court and such special commissioners. Thereupon an application was made by the railway company on June 13, 1917, for additional writs of certiorari to be directed to the judge of probate and the special commissioners appointed by the probate court commanding them to make a, return of all proceedings had before said court or said special commissioners in relation to said drain. This motion was denied by the learned circuit judge on August 2, 1917, but in denying said application the following order was made:
    “It is further ordered that the said respondents be required to make further answer to said writ of certiorari as to the testimony given by them in probate court and before the special drain commissioners, and to answer as to whether or not the testimony set forth in the affidavit for the writ of certiorari is the testimony as given by them before the judge of probate and before said special drain commissioners.”
    To the order to show cause issued in this case the learned circuit judge who heard it returns in part as follows:
    “The following points were discussed and considered:

      “First. Whether the drain commissioners could be compelled to make further return as to the matters which they did not do in their official capacity and as to the proceedings in the probate court and before the special commissioners.

      “Second. Whether two new and separate certioraris should be ordered issued by said court,”

      And further:
    “That as to paragraph 17 this respondent says, that he admits the matters therein set forth, but alleges in addition thereto that the order presented to the commissioner for a certiorari was drafted by the counsel for petitioner, to suit his demands on said application, and that said commissioner did not refuse to grant him the certiorari that he asked for.
    “That as to paragraph 27 this respondent admits that the affidavit for certiorari was filed; that the return was made and that the exhibits attached are substantially correct; that he has no knowledge whether the evidence taken by the stenographer is true and gave a full account of all the evidence received but insists- that what such evidence is should be returned by the probate court and special commissioners before whom the same was taken, and that the drain commissioners cannot be required to state whether said evidence is full and correct.
    “And in further answer to said paragraph this respondent insists, that a large portion thereof is argumentative and that in so far as it quotes the answer of said drain commissioners to the affidavit for certiorari, that said answer, being an exhibit, should be taken as a whole and so construed and that the reason why said drain commissioners did not in such answer reply to all the matters set up in the affidavit.for certiorari, ' that the matters which they did not reply to were such that either the probate court or special commissioners should have replied to, being matters before them in their official capacity and not matters which said drain commissioners could answer or return upon.”
   Brooke, J.

(after stating the facts). It is the contention of counsel for defendant that the circuit court was without power to grant the additional writs of certiorari. This position is predicated upon the fact that the statute, 1 Comp. Laws 1915, § 4908, provides that notice of such certiorari shall be served upon the county drain commissioners within ten days after the final order of determination has been filed. It appears to be conceded that the railway company proceeded strictly in accordance with the terms of the statute to secure a review in the circuit court, but the return of the drain commissioners shows that they are unable to make return of the proceedings before the probate court as well as those before the special commissioners. • The argument is made that, because this application for additional writs was made after the expiration of the ten days limited by the statute, the circuit court is without jurisdiction to issue the additional writs. The railway company filed no new affidavit and alleged no additional errors. It is asserted on behalf of the company that returns should be securdd from both the probate court and the special commissioners in order that the circuit court may be possessed of all matters and proceedings to enable it to intelligently pass upon the. alleged errors. It is, of course, true that one desiring to review drain proceedings by certiorari is limited strictly by the statute, but in the case at bar it appears to us that the petitioner acted seasonably and that if the drain commissioners are unable to make return of all proceedings affecting the establishment of the drain and bearing upon the rights of the petitioner, that additional writs should issue as a matter of course even after the expiration of the ten days limited by the statute. That the drain commissioners are unable to make a full and complete return is apparent both by their return to the writ issued against them and from the return of the learned circuit judge to the order to show cause herein. Section 13, chapter 12, of the judicature act (3 Comp. Laws 1915, § 12364) provides:

“No action at law or in equity shall be defeated by the non-joinder or mis-joinder of parties. New parties ' may be added and parties mis-joined may be dropped, by order of the court, at any stage of the cause, as the ends of justice may require.”

In certiorari it has been held that in the discretion of the court, others standing in the same relation as the original relators to the proceedings sought to be reviewed may be admitted to occupy the same position, although the time limited for suing out the writ has expired. People, ex rel. West, v. City of Syracuse, 59 N. Y. Supp. 763, and where it is necessary to add new parties before the hearing to aid the court to render a decision the same may be done. Bowlby v. Mayor, etc., of Dover, 64 N. J. Law, 184 (44 Atl. 844).

The court below must hear this case under the writ of certiorari already issued. We can see no reason, when such hearing is had, why the court in reaching its determination should not be aided by whatever may be made to appear through the returns made by the probate judge and the special commissioners. We have no hesitation in holding that the jurisdiction of the circuit court to issue writs was not exhausted by the issuance of the first writ against the drain commissioners and that in the exercise of sound discretion he should have directed the issuance of additional writs directed to the parties against whom the same were sought. Mandamus will issue.

' Ostrander, C. J., and Bird, Moore, Steere, Fellows, Stone, and Kuhn, JJ., concurred.


author: Per Curiam.

text:
    DETROIT TAXICAB & TRANSFER CO. v. WAYNE CIRCUIT JUDGE.
    Default — Court Rules — Settino Aside Default.
    The provisions of Circuit Court Rule No. 32, section 4, providing that where the plaintiff has taken the default of the defendant, the default should not be set aside after the expiration of six months, does not apply where the default of the plaintiff is taken by the defendant; in which case the question of setting aside the default addresses itself to the sound discretion of the court.
    Mandamus by the Detroit Taxicab & Transfer Company to compel George S. Hosmer, circuit judge of Wayne county, to vacate an order setting aside a default.
    Submitted July 2, 1918.
    (Calendar No. 28,881.)
    Writ denied September 27, 1918.

      A. J. Groesbeck, for plaintiff.

      Walter M. Nelson, for defendant.
   Per Curiam.

Mandamus is sought to set aside an order made by the respondent. The petitioner was served with a summons on the 15th day of March, 1915, at the suit, of one Thomas A. Noble. Defendant entered its appearance in said cause by its attorney on the 23d of March, 1915. Nothing further was done in said action until the 14th day of April, 1916, and on that day the default of plaintiff for failure to file his declaration was regularly filed in said cause. Subsequently an order was made by the Wayne circuit court dismissing the cause, under the provisions of section 2, chap. 18, of the judicature act (3 Comp. Laws 1915, § 12574). Nothing further was done in said cause until the 19th day of March, 1918, when the attorney for the plaintiff filed a motion to set aside the order dismissing the case, and asked that the same be reinstated, the principal reason alleged being that he believed that a declaration had been filed, and on the 30th of March, 1918, an order was entered setting aside the order defaulting the plaintiff in the action. Since then á declaration has been filed and tendered the defendant, in which the plaintiff claims damages for personal injuries sustained while employed by the relator.

It is the contention of counsel for the relator that the circuit judge clearly ábused any discretion vested in him in setting aside the default taken April 14, 1916, on a motion made March 19, 1918. Our attention is called to section 4 of Circuit Court Rule No. 32, which provides for setting aside defaults taken against the defendant by the plaintiff. The section in question reads as follows:

“Any order entered under this rule may be set aside on special motion for cause shown, in the discretion of the court, on such terms as may be deemed just and proper. In’actions at law, the party desiring to have a default set aside shall, as soon as practicable after he shall know or have reason to believe that the default has been filed, file and serve an affidavit of merits, and make application to the' court to have the defáult set aside. In actions in equity, to entitle a defendant to an order setting aside his default for want of appearance or answer, he shall proffer a sworn answer showing a defense on the merits as to the whole or a part of the plaintiff’s case. In all cases where personal service shall have been made upon a defendant, and proceedings taken after default on the strength thereof, his default shall not be set aside unless the application shall be made within six months after such default is regularly filed. And, subject to statutory provisions, in any case where personal service shall have been made upon a defendant, an order setting aside his default shall be conditioned upon his payment to the plaintiff of the taxable costs incurred in reliance on said default, and the court may impose such other conditions as shall be deemed proper.”

It is said that this rule establishes the policy of the State in fixing a time beyond which defaults should not be set aside, and that while in terms it is limited to cases where the plaintiff has taken the default of the defendant, the rule should be extended by construction to include cases where the default of the plaintiff is taken by the defendant. With this contention we cannot agree, as the language of the rule is explicit and plain and the six months’ provision made to apply only to cases where the default of the defendant has been taken. The various sections of Rule No. 32 cover the question of defaults of either party, and nothing is found within the rule to prevent the respondent from acting. It simply becomes a question of whether or not, under the circumstances of this case, it should be said that he abused his. discretion in setting aside the default. The setting aside of a default under circumstances similar to the one here in question, addresses itself to the sound discretion of the court. No claim is here made that anything has happened since the order dismissing the case which has prejudiced the relator in its defense, and we find nothing in the record to justify us in saying that the learned trial judge clearly abused the discretion vested in him.

The writ is denied, with costs.