text:
    SAUNDERS v. CLOSS.
    1. Replevin — Discontinuance—Stipulation.
    A stipulation by defendant in replevin with plaintiff that the latter may discontinue his suit upon turning over the property to such defendant will not bind oo-defendants having adverse interests in the property.
    2. Same — Possession under Mortga&e — Defenses.
    In replevin, the questions whether an assignment to plaintiff of a chattel mortgage under which he claims, and which, if unpaid, constitutes a first lien upon the property, was in fraud of the creditors of his assignor, the mortgagee, and whether a foreclosure of such mortgage by plaintiff was or was not valid, cannot be litigated by defendants, who took the property from plaintiff’s possession, claiming neither as creditors of plaintiff nor of the mortgagee, but merely as owners of a subsequent mortgage; the only proper inquiry in such case being as to whether anything remained unpaid on plaintiff’s mortgage, as the holder of such a mortgage in possession will be protected to the amount of his lien for any unpaid balance.
    3. Appeal — Review.
    Error assigned upon instructions claimed to be unsupported by the evidence cannot be considered where the record does not purport to contain all of the testimony given at the trial.
    Error to Wayne; Aldrich, J., presiding.
    Submitted November 3, 1897.
    Decided May 18, 1898.
    Replevin by George W. Saunders against John J. Gloss and George H. Fowler. From a judgment for defendants, plaintiff brings error.
    Reversed.

      John Atkinson, for appellant.

      Bowen, Douglas & Whiting (James H. Pound, of counsel), for appellee Fowler.
   Long, J.

This case was before this court at the April term, 1895, in a mandamus proceeding, and is reported as Fowler v. Wayne Circuit Judge, 105 Mich. 90. The action is in replevin. It appears that March 10, 1888, the property in controversy was owned by Mary A. Closs and Mary H. Saunders, doing business as Closs & Co. The property consisted of horses, carriages, harnesses, furnishings, etc., being the stock in a livery stable owned by Closs & Co., and the business carried on by them. On the above date, Closs & Co. gave to Patrick Blake a chattel mortgage covering all of said property, for the sum of $1,000; the condition being that Closs & Co. should pay or cause to be paid to Blake the debt aforesaid, with interest, and should ‘ ‘ discharge, take up, satisfy, and pay each and every note or obligation which the said Blake may hold against the said first parties, or hereafter make or sign for their accommodation, on or before the 10th day of March, 1889.” On January 21, 1891, Blake assigned this mortgage to plaintiff, George W. Saunders. In the meantime, and on August 17, 1888, Closs & Co. gave a bill of sale of all this property, and conveyed the. title, to Mary H. Saunders; the consideration being $3,500. To secure this payment, Mary H. Saunders gave a chattel mortgage upon the same property to Mary A. Closs for the sum of $3,500, payable in 35 equal monthly installments. Subsequently Mary H. Saunders conveyed the property to Saunders & Co., composed of Mary H. Saunders and William H. Saunders, Jr. Saunders & Co., on April 18, 1889, gave to Hincks & Johnson a chattel mortgage on all this property and other property for $3,600. This mortgage is, in terms, subject to the mortgage made by Mrs. Saunders to Mrs. Closs, but makes no reference to the Blake mortgage. The mortgage given by Mary H. Saunders to Mary A. Closs for $3,500 was assigned to Caleb EL Closs, the father-in-law of Mrs. Closs.

The situation in January, 1891, as claimed by plaintiff, was that there remained due on the Blake mortgage, which had been assigned to plaintiff, the sum of $425. Nothing had been paid on the Closs mortgage. The Hinclcs & Johnson mortgage had been reduced to about $1,700. February 28, 1891, John J. Closs, son of Caleb H. Closs, claiming to have become assignee of the Closs mortgage, undertook to foreclose the said mortgage, and took the property from the plaintiff, who was in possession, and advertised it for sale. The notice of sale in this foreclosure proceeding was signed, “John J. Closs, Assignee of Mortgage, by George H. Fowler, His Agent.” This sale was to take place March 7, 1891. Plaintiff, claiming to have acquired the title to the property, on that day brought replevin, and took all of it on his writ,— Snow, Brooke, and Haigh becoming sureties on his replevin bond; and, to secure them against loss, the property was turned over to them. In July, 1891, these sureties caused it to be returned to Closs; and he agreed to release them from all claims on their bond, and that the suit should be discontinued. The plaintiff was in Ohio, but his written assent to this arrangement was procured. This stipulation for surrender and settlement contained a proviso .as follows: “It is understood that, if said Fowler should be found to have held said goods in any other capacity than as my [Gloss’] agent, this release shall not affect any right that he may have.” It appears that Hincks & Johnson had entered into an arrangement with John J. Closs to foreclose the Closs mortgage. Charles B. Lothrop was acting as attorney for John J. Closs; and Bowen, Douglas & Whiting, together with George H. Fowler, were acting as attorneys for Hincks & Johnson; and Mr. Fowler, as we have seen, had signed the notice of sale as agent for Closs. It was at this stage of the proceedings that the property was replevied by the plaintiff.

Before the property had been turned over to Closs, it appears that .Atkinson, Carpenter, Brooké & Haigh, as attorneys for George W. Saunders, opened negotiations for a settlement of the matter; and the sureties on the bond to Closs made a written proposition, without conceding or denying the validity of the claims, to pay $1,600 in cash, give a joint note for $1,700, with interest at 7 per cent.,' payable in sums of $100 or more at any time, the whole to be paid in one year, and to give a mortgage on all the property for $2,000, with interest at 7 per cent., payable in installments of $100 or more per month; payments to commence as soon as they had been reimbursed for advancements and liabilities assumed, but the whole to be paid in one year from September 10th. George W. Saunders, by his attorney, approved this agreement. Mr. Murray, of the firm of Hincks & Johnson, testified that he met these parties, and then told them that his firm had an interest in the property taken on the writ of replevin, by reason of the agreement made by his firm with John J. Closs; that he then showed them a copy of this agreement. This arrangement for the payment of the money and the giving of the note and mortgage seems not to have been completed, and the property was turned over to Closs. The attorneys for the sureties on the bond then wrote Bowen, Douglas & Whiting that the property had been returned to Closs, and that he had released them from their obligations on the replevin bond. Haigh had requested Fowler to discontinue the replevin suit, and the sheriff to surrender the bond; and Fowler had declined to do so, on the ground that he held the property for the joint benefit of Closs and Hincks & Johnson, and he would iook to the bond to make good his interest and the interest of Hincks & Johnson.

It may as well be stated here that the plaintiff claimed that a foreclosure had been had under the Blake mortgage, and the property bid in by the plaintiff, and that, even if the foreclosure of that mortgage was irregular, there was still due upon it the sum of $425 and interest. This claim was disputed, and defendants on the trial gave testimony tending to show that the Blake mortgage had been fully paid, and in fact that the assignment of that mortgage by Blake to the plaintiff was for the purpose of making a pretended foreclosure to cut off the other mortgages, by the plaintiff’s bidding in the property in his own name. It was also contended by defendants that the property had largely depreciated in value after it came into plaintiff’s hands, and before it was surrendered to Gloss. It also appears that on February 26, 1891, and before Closs took the property back from Saunders, a written agreement was entered into between Closs and Hincks & Johnson that Hincks & Johnson, who held the third mortgage, might foreclose his (Gloss’) mortgage in his name, purchase in the property under the foreclosure, and apply the proceeds — First, to the payment of any and all expenses connected with the foreclosure and of the action of replevin; second, to pay expenses of litigation growing out of the foreclosure; third, balance of proceeds to be equally divided. Hincks & Johnson had notice of the surrender of the property to Closs, and Closs offered, after receiving it, to divide with Hincks & Johnson. Closs foreclosed the mortgage, bidding in the property, and offered to divide it with Hincks & Johnson, or resell it and divide the proceeds.

When the replevin case was called, plaintiff asked to discontinue under the stipulation made with Closs. This was denied, and the cause came on for trial, resulting in a verdict by which the jury found that plaintiff was the general owner of the property, and that the defendants did not unlawfully detain it; and, the defendants having waived a return, they found the lien of Fowler, as agent for Hincks & Johnson, to be, with interest, $2,275. Judgment was entered upon this verdict, and plaintiff brings error.

It is contended by counsel for plaintiff that the settlement made by his sureties with Closs, and assented to by the plaintiff, is binding upon all the parties, and that his request made to discontinue the suit should have been granted. The argument is that this settlement was made in good faith, and that under it the plaintiff was induced to change his own position, in that he surrendered the rights which he had under the Blake mortgage, and at a later date, supposing the cause to be settled, bought the property back from Closs, and paid him $1,250 therefor. It is also contended that there is nothing in the agreement between Closs and' Hincks & Johnson which made it improper for the plaintiff or his sureties to deal with Closs, and surrender the property to him; that the most that can be claimed under this agreement is that it made Hincks & Johnson co-owners of the Closs mortgage; that the plaintiff could surrender the property to any of the owners; that the owner of an undivided share is, as to strangers, entitled to possession, and may even maintain replevin. It is also contended that Closs was the proper person to deal with; that Hincks & Johnson, having by their agreement obtained the right to foreclose the Closs mortgage, undertook to do it in Closs’ name, caused it to be advertised for sale in his name by Mr. Fowler as his agent, and in this way asserted that the proceeding was his (Closs’), and that he had a right to control it; that, having asserted Closs’ ownership, and the plaintiff having acted upon this assertion, and having commenced his action of replevin against Closs, and having thereafter settled with Closs, the defendants cannot now assert that some one else really owned the mortgage.

It is also contended that Hincks & Johnson, as well as Closs, are estopped from questioning this settlement; for, as soon as Hincks & Johnson received notice of it, they put themselves in negotiation with Closs and his attorney, Mr. Lothrop, and came to an understanding with them that the property should be sold under the Closs mortgage, and the proceeds divided in accordance with their agreement; that the property was sold, and bid in by Closs, who then offered to divide the proceeds or make a resale; that thus Hincks & Johnson had ample opportunity to protect themselves, but, instead of doing so, allowed Closs to go on and sell the property, and plaintiff to make a new investment.

The contention that the court should have granted the motion for a discontinuance of the suit, under these circumstances, cannot be sustained. As was held in Fowler v. Wayne Circuit Judge, supra, the circuit court could not dispose of the case summarily upon this motion. That was the very point in controversy when the case was here on mandamus, and that ruling must be adhered to.

Counsel for plaintiff, by the same argument, contends that the court was in error in refusing to give his request in charge to the jury as follows:

“If, after the surrender of the property to Closs, the defendants had full opportunity to protect'themselves by taking the pro’perty under the agreement with Closs, and neglected to do so, the jury should find for the plaintiff.”
When the court’s attention was called to this request, he remarked: “I think I have covered that in my general chai’ge. ” In the general charge upon this subject, the court said:
“If the jury find from the evidence that the plaintiff, in ignorance of the agreement between Hincks & Johnson and Closs, and believing that the Closs mortgage was being foreclosed in Closs’ right, although for the joint benefit of himself and Hincks & Johnson, entered into the arrangement for the discontinuance, and in pursuance of such arrangement waived his alleged right under the Blake mortgage, and surrendered up the property taken on the writ to Closs, and all this was done in good faith, and that Closs actually offered to carry out the agreement between himself and Hincks & Johnson so far as to the division of the property or its proceeds, and that the property had not deteriorated in value so far but that it was ample to satisfy both mortgages, then the plaintiff is entitled to have a judgment entered in accordance with, the stipulation. If you believe from the evidence in this case that the plaintiff was not informed of the nature of the contract between Hincks & Johnson, and that he believed that Fowler was acting only as the agent of John J. Closs in the foreclosure of the Closs mortgage, and that his (Gloss’) actions and doings were such as to lead an ordinarily prudent person to believe, — that is, Fowler’s actions and doings were such as to lead an ordinarily prudent person to so believe, — and that nothing was done by Hincks & Johnson, or their attorneys, that would ordinarily put a person in the position of the plaintiff or his attorneys upon inquiry as to any other rights which Fowler might have in the premises, and that the plaintiff acted in good faith in attempting to make a settlement with John J. Closs, whom he believed to be the only party in interest, then the verdict of the jury should be in accordance with the stipulation entered into between the plaintiff and John J. Closs.”

It will be seen that the court did not give the request in the words in which it was framed, but did so substantially, adding that if the plaintiff was ignorant of the agreement between Hincks & Johnson and Closs, and the property had not deteriorated in value so far but that it was ample to satisfy both mortgages, then plaintiff would be entitled to a judgment to be entered in accordance with the stipulation; that is, to have the case discontinued. We think the court was not in error in this addition to the charge as requested. There was some evidence in the case that the plaintiff had notice of the claim made by Hincks & Johnson before the property was turned back to Gloss. The agreement itself to release the sureties of plaintiff contained a clause that has before been noticed; that is, that, if Fowler should be found to have held said goods in any other capacity than as agent for Closs, the release should not affect any rights he might have. No effort, as it appears, was made by plaintiff to settle with Fowler until after the property was returned to Closs. Defendants also offered proofs tending to show that the plaintiff and his sureties knew of the Hincks & Johnson and Closs agreement before this time. Testimony was also given by the defendants tending to show that the property, at the time of the seizure by plaintiff on his writ of replevin, was worth some $3,500, and that when it was turned back to Closs it had greatly depreciated in value. The court very properly left these questions to the jury, and we think it was not error to couple them with the above proposition made by counsel for plaintiff; for, if the plaintiff knew of the agreement between Closs and Hincks & Johnson, and it was a fact that the property had greatly depreciated in value at the time Closs took it back, then Hincks & Johnson, through Fowler, acting as their agent in the premises, and who is made a party defendant in the replevin suit, had a right to show the value of their interest in the property ; and that interest could not be cut off by the agreement made by Closs with the plaintiff’s sureties, and Fowler, as defendant, would not be estopped from showing it.

It is contended that the plaintiff was entitled to judgment under the Blake mortgage; that there was 1425 still due upon it. The Blake mortgage had been renewed from year to year, and had been foreclosed by plaintiff, and the property bid in by him. Counsel for plaintiff asked the court to instruct the jury that:

5‘ The evidence is undisputed that the Blake mortgage had before that time been assigned by the mortgagee to the plaintiff, and by him foreclosed, and that at the foreclosure sale the property was bid in for the plaintiff. And if the jury believe that at that time there was a balance due on this mortgage of $425, and that the goods were sold for the amount of this balance, then the plaintiff got a title which was good as against the defendants; and, unless the settlement alleged is carried out, the plaintiff is entitled to a verdict.”

This was refused, and the court charged the jury upon this subject as follows:

“ If the jury believe that whatever money had been loaned by Patrick Blake in 1888, and whatever indorsements he had made prior to March 10, 1889, had been paid, then the said Blake mortgage became and was paid and void. If the jury believe from the evidence in this case — from the admissions of plaintiff or otherwise — that plaintiff never became the owner of the Blake mortgage, but that the transfer was a cover to defeat creditors, then it would not be legally enforceable in this case in plaintiff’s behalf, as against the defendants. If the jury are not satisfied that there was any honest foreclosure of the Blake mortgage, then the plaintiff could not recover in this action under the claim of a foreclosure of such mortgage. The jury are the sole judges of the facts as to whether the sale from Blake to the plaintiff was of a valid mortgage, or one that had been paid, or whether it was assigned for anything but a cover, or whether it was-fairly foreclosed, and whether there was a sale or not; and, bearing upon those questions, they may consider the action of the elder William H. Saunders in renewing it after the claimed foreclosure. You may also consider in that connection the claim-made by the plaintiff that it was for the purpose of estopping any possible question as to the legality of such foreclosure. * * * I will say that, generally, if the amount -of money loaned or liability assumed by Patrick Blake prior to March 10, 1889, was paid prior to March 10, 1889, then the so-called Blake mortgage, so far as it affects this suit, was discharged; and the fact that the plaintiff may or may not have procured an assignment of it, and undertaken to foreclose it, should not be taken into consideration by you in arriving at a verdict, as a foreclosure under such circumstances could not affect the holders of the so-called Oloss and Hineks & Johnson mortgage.
“The undisputed evidence shows that there was $1,000 loaned on the Blake mortgage at the time it was made, and that there were subsequent advances made by Mr. Blake to the mortgagors and those claiming under them, of considerable amount. The fact that the mortgagors and those claiming under them repaid -Mr. Blake more than $1,000, so long as it was understood between them that such repayment should not cancel the mortgage, but that the balance due should remain secured by it, would not have the effect of discharging the mortgage, and in such case the plaintiff would be entitled to possession under the mortgage as against the Hineks & Johnson and Gloss mortgages, whether the foreclosure was valid or not. I will further add, in relation to this Blake mortgage, that if, after this mortgage was made to Blake, they made payments upon that mortgage, and it was understood by them and by Mr. Blake that they made those payments to apply upon that mortgage, then every payment that was so made should be so applied; and, if there were sufficient of such payments to cancel that mortgage, then the mortgage would be canceled. But if, on the other hand, there was a running account between Blake and these parties, as well as this mortgage dealing between them, and he loaned them money at various times, and they repaid the money at various times, then their repayments of the money advanced, besides that mortgage, would have no effect upon the mortgage, and would be applied only as they themselves agreed upon. ”

It is contended that by this charge questions were raised which were not in the case; that there was no testimony tending to show that the transfer from Blake to plaintiff was to defeat creditors, or to show any admissions of the plaintiff; that it was equally mischievous to leave it to the jury to say whether there was any honest foreclosure of the Blake mortgage. It is further contended that the assignment of the Blake mortgage could not have the effect to defeat creditors; that Blake’s creditors were in no way concerned, and the transfer to plaintiff could not affect them injuriously; that the defendants were not creditors, either of plaintiff or Blake.

As we have seen, the Blake mortgage was given by Closs & Co., composed of Mary H. Saunders and Mary A. Closs. It was the first mortgage upon the property. It was transferred to plaintiff before he became the owner of the property, and, unless paid, was a valid lien in his hands for the amount remaining unpaid, and was entitled to priority over the other two mortgages. It was put on file in the proper office, and had been renewed as the statute requires. The only question upon it open for discussion was whether it had been paid; for, if the foreclosure was invalid, yet plaintiff would have the right to assert a lien thereunder, as such lien had been kept alive by the renewals. The court was therefore in error in submitting to the jury the question whether the transfer of the Blake mortgage was a cover to defeat creditors of Blake, or whether there was an honest foreclosure of it, so far as affecting the lien which plaintiff claimed thereunder ; and he, being in possession of the property, would be protected to the amount of his lien.

It is also contended that defendants showed no right to recover under the Closs mortgage, for the reason that it had never been assigned to John J. Closs, one of the defendants here. The mortgage was given to Mary A. Closs, and by her assigned to Caleb H. Closs, and it remained unassigned by him up to March 23, 1892, when it was assigned to the plaintiff in consideration of the sum of $000. This assignment was made by J. J. Closs as agent for Caleb H. Closs. On the trial, defendant Closs testified that there was no formal assignment of this mortgage by Caleb H. to him; but, as stated in the record, “he had a letter which was identified and marked, but not introduced in evidence.” The court, however, charged the jury that:

“The claim of John J. Closs, as you will remember, to the right under this Closs mortgage, was under a verbal assignment. If John J. Closs was not authorized to foreclose the Closs mortgage in his own name, and if Fowler did not hold the propex’ty under the Hincks & Johnson mortgage, then your verdict will be for plaintiff.”

The coxxrt’s attention was then called to the fact that there was no claim of any verbal contract of assignment, and he said:

“What I mean is, it was not a formal assignment. If it was that which would amount to an assignment, and if he was appointed for the purpose of foreclosing it in his own name, — I will leave these questions to the jxxry.”

We find no evidence whatever in the record that the mortgage was ever assigned to John J. Closs, or that he was ever axxthorized by Caleb H. to foreclose it. But, inasmuch as the record does not purport to contain all the evidence, we cannot say that xxo such testimony was given on the trial.

For the error pointed out, the judgment below must be reversed, and a^new trial awarded.

The other Justices concurred.


source: Caselaw Access Project

author: Grant, C. J. Montgomery, J.

license: Public Domain

text:
    BURNHAM v. INTERSTATE CASUALTY CO.

    Evidence — Cause op Death — Presumption.
    Where death may be attributable either to suicide or accident, the presumption of law is against suicide.
    2. Same — Death in Water.
    The fact that the body of a person, who was seen struggling in the water, did not sink, as is usual in cases of drowning, is not conclusive that the cause of death was apoplexy or sudden seizure, rather than drowning. So held, at least, where there was evidence tending to show a condition — i. e., the distension of the abdomen by gases — which, in the opinion of experts, accounted for the phenomenon.
    3. Same.
    Assuming that some sudden seizure caused deceased to fail into the water, or came upon him after he had accidentally fallen, it does not necessarily follow that his death was not caused by drowning.
    4. ' Same — Accidental Drowning — Question por Jury.
    Deceased, insolvent and heavily insured, in the afternoon of the day on which he made his will, rented a boat and started to row across the river. Nothing unusual had been noticed in his appearance or conduct. He was seen to fall into the water, to swim towards his boat, and to call for assistance. When reached, he was dead, and his body was floating, face downward. His boat had taken in no water. " The body bore symptoms of drowning, and the abdomen was dilated with gases. Held, that a finding that deceased was accidentally drowned was justified.
    5. Insurance — Garnishment op Company — Special Interrogatories — Time por Filing Answer.
    An insurance company, when garnished by the creditors of a beneficiary, has a right to wait until the expiration of the time allowed it by the terms of the policy for examining and determining as to the validity of claims, before answering special interrogatories with respect to its grounds for denying liability upon the polioy. Per Grant, C. J.
    6. Same — Breach op Warranty — Waiver.
    An insurance company which furnishes to a beneficiary, upon request, blanks for proofs of death, the preparation of which entails expense to the beneficiary, with merely a general statement that the furnishing of the same shall not be deemed a waiver of any of the agreements or conditions of the policy, will be held to have waived the right to insist upon a defense growing out of a breach of warranty on the part of the insured of which it had knowledge at the time the blanks were furnished; and the question is in no way affected by the fact that its information as to the breach was acquired from others than the beneficiary. Grant, O. J., and Hooker, J., dissenting.
    Error to Wayne; Carpenter, J.
    Submitted January 7, 1898.
    Decided May 18, 1898.
    Garnishment proceedings by James K. Burnbam and others against the Interstate Casualty Company of New York, as garnishee of Eva Winans. From a judgment for plaintiffs, the garnishee defendant brings error.
    Affirmed.
    The appellant is garnishee of the principal defendant in several suits that were consolidated and tried as one. The suits were commenced August 29, 1896. Plaintiffs’ claim rests on an accident policy issued by appellant on the application of W. N. Winans, the husband of the principal defendant. The policy, among other things, provided, in case of his death by “external, violent, and accidental means,” for the payment to his wife of 15,000. The inspired had been manager of his wife’s dry-goods business, carried on under the name of Winans & Co. It was closed under chattel mortgages aggregating $57,176.02, and covering property estimated by the insured to be worth $80,000. The fire-insurance companies had canceled their policies upon the stock. The mortgages covered the homestead, household furniture, and fixtures of Mrs. Winans. Mr. Winans had been arrested on a capias, and was in the custody of his bail. He had $85,000 of insurance (life and accident) in various companies, all of which were payable either to his son or his wife, except the last, which was for $5,000, and was payable to his brother. The first of these policies was taken out in 1889, another in 1892, and the rest in 1895 and 1896. The last one was an accident insurance for $5,000, and was issued August 1, 1896. The application for the policy issued by the defendant company contained the following: “I have no accident insurance, except as herein stated; and I hereby agree to notify the company of any hereafter applied for or obtained.” The policy expressly stated that it was issued “in consideration of the warranties in the application.” No notice of the subsequent policy was given by the insured, and the defendant had no information in regard to it until after the death of Mr. Winans. Mr. Winans made his will August 24, 1896, and in the afternoon of that day rented a rowboat, and started to row across the Detroit river. He was seen to-fall into the w;ater; to be swimming towards his boat, and crying out for assistance. Some parties, seeing and hearing him, took a boat, and rowed to his assistance. When they reached him, he was dead, and the body was floating in the water,, with the face downward. The defendant denied liability under its policy. Issue was duly joined, and plaintiffs had verdict and judgment.

      James C. Smith, Jr. (Otto Kirchner, of counsel), for appellant.

      Elliott G. Stevenson and John D. Conely, for appellees.

       Rehearing denied June 28, 1898.

   Grant, C. J.

(after stating the facts). Two reasons are urged against the judgment: (1) That there was no evidence that Mr. Winans came to his death by external, violent, and accidental means; (2) that there was a breach of warranty in applying for and obtaining the subsequent insurance in the Standard Company without notice to the defendant.

Upon the first point the learned counsel state their contention as follows:

“There is no direct evidence of accidental drowning. The undisputed physical facts tell their own story. They say, as we shall presently show, that Mr. Winans may have drowned accidentally; that he may have died of apoplexy; that he may have drowned intentionally. Is it possible that a jury is permitted to guess which of the three admissible hypotheses is true ? ”

They insist that the case falls within the rule in Merrett v. Accident Association, 98 Mich. 338. No question is raised upon the instructions to the jury, provided there was a question for their determination. The statement of the plaintiffs’ proofs is therefore essential.

There is no evidence of anything unusual in the appearance or conduct of Mr. Winans prior to his death. On his way to the boathouse, he met a friend, who invited him to accompany him to the Windsor races. He declined, but said he was going to take a boat ride, and invited his friend to go with him, saying: “I will get some cigars. We will get a boat, and have a real nice, pleasant time.”

One Heron was driving over the Belle Isle bridge. He saw Mr. Winans in the boat, and his hat in the water.

“Saw him row around to get his hat. He came alongside of it. When he came alongside of the hat, he got over. Saw him fall into the water, and he hollered for help. * * * He came*up that far [indicating by a gesture ] out of the water.”

On cross-examination he testified as follows:

“I was just about a quarter of the way over — a little better — when I first saw the man in the water. He was shouting for help. I was pretty near the end of the bridge, and going slow, to watch him all the while. When I last saw him he was in the water, trying to save himself,— trying to get aboard; and the boat went down sideways, and she kept floating away from him. He tried to get to the boat. I walked my horses, and stopped occasionally. Drove nearly three-quarters of the length of the bridge, looking at him all the time, not stopping any length of time, only going slow several times. When I was about three-quarters across the bridge, the man just disappeared under the water. I saw him sink once; did not see him come up again.”

One Kirk testified that he was on the bridge.

“ Saw the ferryboat coming out of the Belle Isle dock, and a man in a small boat. ' The boat and the man disappeared all at once. I then saw the rowboat going down the river empty. In a little while, saw the man in the water crying for help. Heard him holler three times. Did not see him make any exertion or effort, only he was hollering for help. Saw his hands like that.”

One Schultz was at the boathouse. Saw Winans get a boat and start out. Heard the ferryboat give three sharp whistles, meaning to get out of the way.

“ Winans was then just where the ferryboat has to go through a small cut on what is called the ‘Middle Ground.’ I watched him when the ferryboat passed him, and could see that he was 50 or 60 feet above the ferryboat. ”

After this he paid no more attention. On cross-examination he testified that, “when the ferryboat gave three whistles, Winans struck off up right at the edge of the Middle Ground.”

One King testified:

“Saw Mr. Winans swimming towards the boat, struggling in the water. * * * Did not see him throw his hands up in the air, or anything of that kind. The kind of struggling he was doing was, it seemed as if he was swimming very fast. He swam after the boat. The boat kept getting away from him.”

One Matzen, who was with King, testified that he thought he noticed him swimming towards the boat. These last two witnesses were the ones who rowed out, and towed the body ashore. They found the body floating, with the top of its head above the water.

One Fritz testified that he saw the man out in the river. Saw the boat floating away, and two objects floating down the river. Heard the man hollering. Heard him plainly two or three times. Did not hear what he said. He was swimming towards the boat, which was empty. Saw him hold both his hands np twice. The waves seemed to go over him. Tie was right in behind a ferryboat when he first noticed him, — perhaps 50 feet from the ferryboat.

One Benoit testified that he saw the man in the water. Heard him holler three times. Saw him swimming and struggling for all he was worth. He was sure he was swimming 20 minutes. He looked as if he was swimming for life.

One Baroski testified that he “saw the man throw up both hands twice, and he hollered three times. He was swimming towards his boat all the time after he got up and came from under the water. Raised both his hands twice, went down, and, when he came up, swam again. ”

Dr. Newman examined the body shortly after it reached the shore. He testified that:

‘ ‘ It presented the ordinary symptoms of a man who died by suffocation. His face was congested. The usual bloody froth and mucous from his lips and nostrils. * * * He had all the appearance of a man who had been drowned. * * * If it was an actual fact that he had been swimming, I should say he died from ordinary drowning. * * * The opinion as to his death, I should think, would depend a great deal upon the fact as to whether he was actually swimming. * * * Assuming that he was swimming towards the boat, screaming for help, and from what I saw of his condition on the dock, I should say that he died, in all probability, from drowning. ”

In reply to a question stating substantially the facts, the witness said, ripon cross-examination, “It is possible that Mr. Winans died from apoplexy, or a fit, or from suffocation.”

Dr. McGraw, another prominent physician, testified, in reply to a question assuming to state all the facts, that he died from drowning, or some sudden seizure, like apoplexy. He also testified'that “a man whose abdomen was distended by gases would be liable to float.” Dr. Newman had testified that the abdomen was unusually dilated with gases. He also testified that a man taken with apoplexy while in the water would not have much chance to escape, and might die from.drowning, notwithstanding he had apoplexy.

The testimony of these physicians is not conclusive, and its sole province was to aid the jury in their deliberations. Much stress is laid by counsel for the defendant upon the fact that the boat took'in no water when Mr. Winans fell overboard. He might have been reaching for his hat when upon the top or side of a wave, in which event the boat might have righted itself without taking water. We think this circumstance of but little moment.

The learned counsel for the defendant insist that the facts deducible from the above testimony are consistent with three theories of the cause of death, and therefore prove no one of them. These theories are apoplexy, sudden seizure, and suicide. We cannot agree in this conclusion. The testimony does not establish facts to overcome the presumption. Where death may be attributable to suicide, murder, accident, or negligence, the presumption of law is against suicide and murder. 4 Joyce, Ins. § 3773; Nibl. Acc. Ins. § 377; Travellers’ Ins. Co. v. McConkey, 127 U. S. 661; Mallory v. Insurance Co., 47 N. Y. 52 (7 Am. Rep. 410). It is true that the bodies of persons who die from drowning usually sink, but there are occasional circumstances under which they do not sink, and there was evidence in this case tending to show the presence of those circumstances. There was ,no autopsy, but there is no evidence tending to show that Mr. Winans was subject to any fits or sudden .seizures. All the circumstances are consistent with accidental drowming, except the mere fact that the body did not sink. If, however, it be assumed that some sudden seizure caused him to fall into the water, or came upon him after he had fallen into the water, it would not follow that death was not caused by drowning.

H. left his lodgings about 7 o’clock in the evening, intending to bathe. His clothes were found on the steps of a bathing machine, and about six weeks afterwards a body was washed ashore, claimed to be his. There was no other evidence of the circumstances of his death. The questions submitted for decision are stated as follows: (l) Assuming H. to have been drowned, and that his death was not caused by suicide, or by his willful act in exposing himself to unnecessary danger, or while he was in a state of intoxication, are plaintiffs entitled to recover ? (2) Was there any evidence, proper to he submitted to the jury, that H. was drowned? Held, that the question was one for the determination of the jury. Trew v. Assurance Co., 6 Hurl. & N. 839. Where a temporary trouble, unusual and uncommon, causes one to fall into the water, and he is drowned, the company is liable. Manufacturers’ Acc. Indem. Co. v. Dorgan, 7 C. C. A. 581, 58 Fed. 945. So, where one was seized with an epileptic fit while crossing a stream, fell in, and was drowned, the company was held liable. Winspear v. Insurance Co., 43 Law T. (N. S.) 459.

Dr. McGraw, after his attention had been called to the circumstances of this case, said:

“I would not say that he had an apoplectic stroke or committed suicide, but that he had some seizure which would take away his senses. There are other things besides apoplectic strokes. A man may die suddenly of heart failure under such circumstances. But my judgment would be that either the man committed suicide, or that he died from some such sudden seizure while in the water.”

The case, upon this point, was properly submitted to the jury.

Had the defendant waived its right to insist upon the breach of warranty as a defense? No communication had been made to the company in behalf of Mrs. Winans, the beneficiary, until September 25th, when a letter was received from her attorney, Mr. Babcock, dated September 21, 1896, and reading as follows:

“Will you please send to me the blank forms you desire used for proofs of death? I write in the interest of Mrs. Eva Winans, wife of William N. Winans, deceased, who was insured by your policy No. 12,308. Mr. Winans was accidentally drowned while out rowing on the Detroit river.”

■ In reply to that letter the company wrote, September 25th, as follows:

“We are in receipt of your communication of the 21st inst., asking that we send to you blank forms used for proofs of death; stating that you write in the interest of Mrs. Eva Winans, wife of Mr. William N. Winans, insured under policy No. 12,308, and that Mr. Winans was accidentally drowned while out rowing on the Detroit river. You fail to give any particulars, or even the date, of the alleged accident, which we are entitled to have immediately in case of accidental injury or death. Although we do not understand how you are going to affirmatively prove accidental death in this case, under the circumstances, yet we will comply with your request, and forward the blanks as requested, subject to the notices and stipulations printed thereon.”

The blank proofs of death furnished contained the following notice:

“These blanks are sent to permit of a statement of facts, and the furnishing of same shall not be held to be a waiver of any of the agreements or conditions of the policy or of the application, nor of the rights of the company in the event of any violations of such agreements or conditions by the insured or beneficiaries, or in any event.”

When proofs of loss were sent, does not appear. They gave all the other insurance, but made no mention of the subsequent policy. ' On November 20th the company wrote Mrs. Winans, informing her that it should rely upon this breach of warranty, and others, also, and inclosed her a draft, as a refund of all premiums paid. After the writs of garnishment were served, and on October 26, 1896, the company filed a disclosure, denying any liability. Soon after that, interrogatories to the garnishee defendant were filed, and by stipulation the time for answering the special interrogatories was extended to December 7th. By the fourth interrogatory the garnishee was called upon to state for what reason or reasons it denied liability upon the policy. By interrogatory 5, the defendant was required to state any statement or statements made by the insured, or any one in his behalf, upon which it relied as a ground for denial of liability.. It refused to answer the fourth and fifth interrogatories. It had, by the terms of the policy, three months from the date of filing proofs in which to examine and determine whether it would acknowledge or deny liability, and asked that the answer to these be postponed till after the expiration of that time. This was granted, and the defendant was entitled to it as a matter of right. On February 1, 189?, it filed answers to these two interrogatories, setting up seven grounds of nonliability, of which we need mention but two: (1) That death did not result from bodily injuries sustained through external, violent, and accidental means; and (2) the breach of the agreement to notify the company if any additional insurance was applied for or obtained.

The company, upon hearing of the .death of Mr. Winans, instructed its agents to investigate. They did so, and reported that they had been informed of this other insurance, and also concluded that Mr. Winans had committed suicide. Neither Mrs. Winans nor these garnishee plaintiffs had given the defendant any information upon which it acted. It made, as was very proper, an independent investigation. Neither the plaintiffs nor Mrs. Winans knew of this investigation, or were in any manner misled by the conduct of the defendant. They were under no legal or moral obligation to inform Mrs. Winans or plaintiffs of what they had learned from their investigation. No case that I have found or examined carries the doctrine of waiver to the extent of holding that, when a beneficiary asks for blank proofs of loss, the insurer waives the defense of a breach of warranty by failing to state that it has been informed that there had been a breach of warranty. The insurer has a right to keep silent until proofs are furnished. Had Mrs. Winans, in her application for blank proofs, informed the company that Mr. Winans had taken out other insurance, and the company had still furnished proofs, without insisting upon this as a defense, there would have been a waiver, under the authorities cited. On every occasion when the company was called upon to speak, it insisted upon this defense. The letter inclosing the blank proofs of loss called the attention of Mrs. Winans to the conditions of the policy and the application, and expressly stated that it would insist on every defense it had for violation of any agreement or condition therein. This was the first occasion on which defendant had been called upon to say anything. What language could be more definite, what statement more complete? This statement was made a part of the letter, just as effectually as though it had been copied in the letter. This is not controverted, and yet it is claimed that, because the defendant did not specifically and expressly state every defense it had or was informed of, and did in its letter hint at one defense, all others are waived. If the defendant had not stated in that letter, “We do not understand how you are going to affirmatively prove accidental death,” would it have been held that it had waived the defense of suicide by its silence, because its agent in Detroit had written that Mr. Winans committed suicide ? If defendant had inclosed proofs of loss without any letter, or with one stating that it waived no defense, would it have waived all violations of the contract of which it had before been informed? The logical result of plaintiffs’ contention is to close the door to every defense, in the face of the most positive assertion that it relied upon all, and waived none. The defense of breach of warranty is a meritorious one. The defendant clearly did not intend to waive it. In language unmistakable it notified Mrs. Winans that it did not intend to waive it; and yet, because it did not specifically state this defense, a waiver is claimed.

While some authorities have gone very far to sustain a waiver, particularly of technical defenses, I find none that have gone to the extent now claimed. We are cited in support of it to Marthinson v. Insurance Co., 64 Mich. 372. The facts in that case are totally different from those in this.. In that case the property was burned July 29th, and notice immediately given to the local agents. An adjusting agent came soon after. On August 21st two adjusting agents met the insured, examined them' under oath, were then informed of the breaches of warranty, and made no objection upon that ground. The insured then obtained instructions from the local agents, made out proofs of loss, and sent them to the company, September 2d. To this no answer was made till October 3d. Under these circumstances the breaches were held to be waived. It is urged that Mrs. Winans was put to the needless expense of filling out proofs of loss. The record does not show that she incurred any expense. The blanks were furnished by defendant, and it was the work of a few moments to fill them. It is idle to say that she incurred any such expense as will affect the question. There was no attempt to embarrass or hinder, as was found to be the fact in the Marthinson Case, 64 Mich. 382; nor was she misled or hindered in any way. “A waiver is the intentional relinquishment of a known right.” 28 Am. & Eng. Enc. Law, 526, and the numerous authorities there cited. Another authority defines it as follows:

“Waiver, in a general way, may be said to occur where-ever one in possession of a right conferred either by law or by contract, and knowing the attendant facts, does or forbears to do something inconsistent with the existence of the right, or of his intention to rely-upon it, in which case he is said to have waived it, and he is estopped from claiming anything by reason of it afterwards.” Bish. Cont. § 655; United Firemen’s Ins. Co. v. Thomas, 27 C. C. A. 42, 82 Fed. 406

This rule is just, and is founded in common sense and fair dealing. To hold that a party has waived a good defense, when upon the first opportunity he expressly, and in writing, asserts that he relies upon every violation of the contract under which claim is made, is not sanctioned by reason or sound authority. It is not approved by the common judgment of mankind. There is not one rule of law for insurance companies, and another for individuals, partnerships, and other corporations. The law is no respecter of persons, and applies the same rule to all, whether acting in their individual or corporate capacity.

The learned circuit judge committed error in instructing the jury that this violation of the contract was waived. For this reason the judgment should be reversed, and a new trial ordered.

Hooker, J., concurred with Grant, C. J.

Montgomery, J.

I agree with my Brother, the Chief Justice, that it was a fair question for the jury in this case as to whether the death of Mr. Winans was the result of accidental drowning. I disagree with the Chief Justice upon the question of waiver. In my opinion, the circuit judge was right in charging the jury that the omission to notify the company of the fact of other insurance was waived. On receipt of the letter from Mr. Babcock, attorney for Mrs. Winans, asking for the blank forms which the company desired to have used for proofs of death, good faith required that, if the company expected to rely upon a defense which would render proofs of loss wholly unavailing, notice of this fact should be given promptly, inasmuch as it was made apparent by Mr. Babcock’s letter that Mrs. Winans would otherwise be put to expense in the preparation of proofs of loss. The learned counsel for the defense, in their brief, say:

“The nature of the company’s business should be kept in view. It might, from motives of business policy alone, be inclined to waive the breach of warranty, if, on investigation of all the facts, it came to the conclusion that an honest loss had been incurred. ”

This is undoubtedly true, and in my judgment the time for the company to determine that question was when it was made known to it that the withholding of such claims of defense, and the furnishing of blanks, would be likely to result in expense to Mrs. Winans. Having failed to disclose the defense at that time, and having permitted the beneficiary to incur this expense, the defense should be deemed waived. Marthinson v. Insurance Co., 64 Mich. 372; Towle v. Insurance Co., 91 Mich. 219; Titus v. Insurance Co., 81 N. Y. 410. The general statement appended to the blank proofs of loss, reserving a right to insist upon a breach of conditions, should not be held to reserve a defense known to the company at the time. Marthinson v. Insurance Co., supra. Nor do I think that the fact that the information that Mr. Winans had other insurance was not derived from the beneficiary affects the question. It is knowledge of the fact, and the action of the company, requiring the beneficiary to incur expense, which renders it an act of bad faith to thereafter seek to avoid the policy.

The judgment should be affirmed.

Moore and Long, JJ., concurred with Montgomery, J.


author: Long, J.

text:
    BABCOCK v. YOUNG.

    1. Mortgages^- Security eor Negotiable Paper.
    Where a negotiable note is given, and a mortgage taken as security therefor, the note is the evidence, and the mortgage only an incident, of the debt; the mortgage becoming, without written assignment, the property of any person into whose hands the note lawfully comes.
    2. Recording Laws — Assignment oe Mortgage — Bona Fide Purchaser — Notice.
    A purchaser of land against which an uncánceled mortgage stands of record, who contents himself with the assurance of his grantor, the mortgagor, that the same has been paid, without inquiring further as to the whereabouts of the mortgage and the note which it secured, cannot thereafter .protect himself against a prior unrecorded assignment of the mortgage by procuring from the assignor a discharge of the same and placing it of x'ecord.
    Appeal from Ionia; Daboll, J., presiding.
    Submitted February 3, 1898.
    Decided May 18, 1898.
    Bill by Burton Babcock against Joseph Young, Ellen Young, John Burke, and Charles Green to foreclose a mortgage. From a decree dismissing the bill, complainant appeals.
    Reversed.

      V. H. & H. H. Smith (Allen B. Morse, of counsel), for complainant.

      Chaddock & Scully, for defendants.

      Rehearing denied June 28, 1898.

   Long, J.

This bill was filed to foreclose a certain mortgage of $300 given November 25, 1882, to John Townsend, and signed by Joseph Young and his wife, Ellen Young. The mortgage was accompanied by a note of even date for like amount, signed by Joseph Young, and due one year from date, with interest at 8 per cent. The mortgage covered lot No. 3, in Hall’s addition to the city of Ionia. The other parties are made defendants as subsequent purchasers or incumbrancers.

It appears that on January 3, 1884, John Townsend assigned this mortgage to the complainant, Burton Babcock,' for the consideration of $326.59. The assignment was in writing, but was not recorded until March 28, 1895. The note, mortgage, and assignment were delivered to complainant, who has ever since that time had them in his possession. It appears, further, that on July 31, 1889, Joseph Young made a contract in writing to sell these premises to John Burke, who paid him $12 per month thereon, the full purchase price being $775. On June 21, 1894, there remaining unpaid on the contract $300, and Burke having arranged with Rudolph Seig to secure the money from him by giving him back a mortgage for that amount, Seig, Burke, and Young went to the register’s office, where the Townsend mortgage was discovered of record and not discharged. Notwithstanding this fact, Seig furnished the money to Burke, who, upon the assurance of Young that the Townsend mortgage had been paid, paid the money over to Young, taking a receipt therefor. Burke had not examined the record before this. June 27th following, Young and wife conveyed the premises by deed of warranty to Burke, and on the 30th (of that month a discharge of the Townsend mortgage was duly executed by Townsend, who was out of the State, and sent to the register of deeds of Ionia county. That discharge was recorded October 5, 1894. Nothing was paid to Townsend for this discharge. The deed of Young to Burke was placed on record July 23d preceding. The Seig mortgage was afterwards paid by Burke. March 28, 1895, the complainant recorded his assignment of the Townsend mortgage.

It is not contended that the Townsend mortgage was ever paid, and there is no dispute as to the fraud of Young, who knew that the mortgage was unpaid. It appears that no inquiry was made by Burke of any one as to the possession of the Townsend note and mortgage, and that no arrangement was made that the money should be refunded by Young if it were found that the Townsend mortgage was a valid lien; but Burke took the word of Young and a brother of Townsend, the mortgagee, that the mortgage had been so paid. The case cannot be likened to one where the party making the purchase relies upon a discharge of the mortgage by the mortgagee before the money is paid. Under the circumstances stated, the record of the mortgage was notice to Burke and to Seig that the mortgage was a lien upon the premises, and they were put upon inquiry as to its ownership, and the discharge then procured from the mortgagee, without further inquiry, would be no protection to them as against the actual owner and holder of the note and mortgage. The taking of a conveyance with knowledge of a prior right makes a person a mala fide purchaser. In Roberts v. Halstead, 9 Pa. St. 32 (49 Am. Dec. 541), it appeared that the terre tenants purchased the land after the registry of the mortgage, and before satisfaction entered. In considering that case, Bell, J., said:

“Had there been a bona fide purchaser of the mortgaged premises after the entry of the satisfaction and without notice of the outstanding notes, or, as was the case in Brown v. Simpson, 2 Watts, 233, were the attending circumstances such as to lead nobody to lean to the conclusion that the mortgage moneys had not been paid, a countervailing equity would have sprung up for the protection of the innocent purchaser.”

In Indiana State Bank v. Anderson, 14 Iowa, 554 (83 Am. Dec. 390), the above case is cited, and that court clearly implies that where lands are purchased after the registry of the mortgage, and before satisfaction is entered, the purchaser cannot be protected as against the owner of the mortgage, though his assignment of it is not recorded.

Mr. Burke had no right to assume that Townsend still held the note and mortgage unless he produced them. He found the mortgage of record, and not discharged, and he was chargeable with notice that the mortgage was a lien in the hands of any person to whom it might have been legally transferred, and the record of the transfer was not necessary to its validity. This question was discussed in Williams v. Keyes, 90 Mich. 290 (30 Am. St. Rep. 438), and there it was held that where a mortgagee assigned the mortgage and accompanying negotiable note by delivery, and the mortgagor, in ignorance of such assignment, paid the mortgage debt to the administrators of the mortgagee, who did not produce or have in their possession the note or mortgage, the payment was no defense to the foreclosure of the mortgage by the holder of the securities.

Counsel for defendants rely upon Bacon v. Van Schoon hoven, 87 N. Y. 450. That case is referred to in Curtis v. Moore, 152 N. Y. 159 (57 Am. St. Rep. 506), where it was held that the assignee of a recorded mortgage upon real estate, which was conveyed by the mortgagor to the mortgagee after the assignment of the mortgage, has a valid lien as against a purchaser of the land from the mortgagee, who took without notice of the assignment, notwithstanding the conveyance to the mortgagee, as well as the conveyance from the mortgagee to the purchaser, was recorded before the assignment was placed on record. The court in that case also referred to the case of Purdy v. Huntington, 42 N. Y. 334 (1 Am. Rep. 532). It was said in that case:

“The question is then presented whether Huntington can be protected in his title as against the mortgage by reason of the omission to have the assignment thereof recorded. It is conceded that he is to be charged with constructive notice of the existence of the mortgage, and of the continuance of its lien, by its record in the proper office. By that he was informed, not only of the date of the mortgage, the amount secured thereby, and of all its particulars, but that it was open and uncanceled of record, and therefore apparently an outstanding lien and incumbrance on the premises of which he was taking title. Having that information, he knew, or, at least, was chargeable in law with the further notice, that it was such lien and incumbrance in the hancls of any person to whom it had been legally transferred, and that the record of such transfer was not necessary to its validity, nor as a protection against a purchaser of the property mortgaged, or any other person than a subsequent purchaser in good faith of the mortgage itself or the bond or debt secured thereby, but, on the contrary, that a vendee of the premises took it subject to the lien of the mortgage, irrespective of the ownership'thereof. That knowledge and notice made.it his duty, in the exercise of proper diligence, f, to inquire whether Mitchell, his vendor, was still the owner and holder of the mortgage, and his omission to make that inquiry deprives him of the protection of a bona fide purchaser,”' — citing cases in support of this proposition.

The court in that case said that Bacon v. Van Schoonhoven, supra, was not in conflict with those cases.

. Counsel for defendants, we think, are not supported by any case in the proposition that, under the circumstances here, the defendant Burke is to be regarded as a bona fide purchaser, and entitled to be protected by a discharge of the mortgage procured after the purchase money had been paid. It has been held many times in this State that where a negotiable note is given, and a mortgage taken as security therefor, the note is the evidence of the debt, and the mortgage only an incident of the debt; that the mortgage follows the note into the hands of the lawful owner of the note; and that, without any written assignment of the mortgage, the owner of the note is the owner of the mortgage. Cooper v. Ulmann, Walk. Ch. 251; Dougherty v. Randall, 3 Mich. 587; Martin v. McReynolds, 6 Mich. 70; Briggs v. Hannowald, 35 Mich. 474. It is also held that one paying a mortgage is bound to ascertain who has the note, as he is chargeable with notice that the note may have been transferred and may be the property of another than the mortgagee, although there is no assignment of the mortgage of record. Fletcher v. Carpenter, 37 Mich. 412; Haescig v. Brown, 34 Mich. 503; Lee v. Kellogg, 108 Mich. 535. In the case of Wilson v. Campbell, 110 Mich. 580, 589 (35 L. R. A. 544), it was said by this court:

“Having constructive knowledge of the existence of this mortgage, Mrs. Nichols "was also chargeable in law with the further notice that the mortgage is a lien in the hands of any person to whom it may have been legally transferred, and that the record of such transfer is not necessary to its validity, nor as a protection against a purchaser, of the property mortgaged, or any other person than a subsequent purchaser in good faith of the mortgage itself or the note or debt secured by it, but, rather, that one purchasing the premises from the mortgagee would take them subject to the lien of the mortgage, irrespective of the ownership of it, unless the mortgagee was the owner. The knowledge and notice would, in case of a direct purchase from White, have made it her duty, in the exercise of proper diligence, to inquire whether her vendor, the mortgagee, was still the owner of the mortgage; and her omission to do so would have deprived her of the protection of a bona fide purchaser,”—citing 1 Jones, Mortg. § 474; Purdy v. Huntington, 42 N. Y. 334 (1 Am. Rep. 532); Burhans v. Hutcheson, 25 Kan. 625 (37 Am. Rep. 274); Oregon, etc., Investment Co. v. Shaw, 5 Sawy. 336.

In the present case, therefore, if Burke had gone to Townsend, and paid the mortgage to him, he would not have been protected without a surrender of the mortgage and note. As we have seen, he paid the purchase price to Young without any inquiry as to who actually held the note and mortgage, and now seeks to be protected by a discharge from Townsend made after the purchase price had been paid, and upon which discharge he did not rely in paying the purchase money. ¡

The court below was in error in dismissing complainant’s bill, and decreeing a discharge of complainant’s mortgage. That decree will be reversed, and the case remanded, with direction that the usual decree of foreclosure be there entered in favor of complainant. Complainant will recover costs of both courts.

The other Justices concurred.

         Apparently overruling Ingalls v. Bond, 66 Mich. 338.

       Upon this question, see, also, cases cited in footnote to Wilson v. Campbell, 110 Mich. 589.


author: Hooker, J.

text:
    FOX v. BARRETT’S ESTATE.
    1. Estates of Decedents — 'Witnesses—Privilege—Waiver.
    Where the representative of a decedent, upon cross-examination, compels a survivor adversely interested to testify, in reference to a contract with decedent, to facts known equally to both, he thereby waives the benefit of the statute excluding such testimony, and throws open the subject inquired about to full explanation upon the redirect.
    2. Same — Admissions.
    The fact that the statement elicited from the adverse party upon such cross-examination is not a direct one as to what the contract was, but merely affirms what the witness has admitted it to be upon a former examination, will not alter the rule, the witness not being confined in his testimony on redirect to the facts brought out in the earlier proceeding.
    3. Same — Claim for Services — Compromise—Evidence.
    A witness called on behalf of an estate testified that he had had a talk with claimant with reference to negotiations between claimant and one of the heirs of the deceased, whereby claimant had agreed to take a certain amount in full of his claim, which was for services rendered. The court ruled out the testimony on the ground that it related to an attempted compromise, it appearing that the heir had no authority to bind the estate, but permitted testimony, as bearing upon the value of the services, that claimant had said that he would be satisfied with the amount claimed to have been agreed upon. Held, that the ruling was correct.
    Error to Wayne; Aldrich, J., presiding.
    Submitted April 6, 1898.
    Decided May 18, 1898.
    William H. Fox presented a claim against the estate of Eliza Barrett, deceased. The claim was disallowed by the commissioners, and claimant appealed to the circuit court. From a judgment for claimant, defendant brings error.
    Affirmed.

      Bacon & Palmer, for appellant.

      James H. Pound, for appellee.
   Hooker, J.

Two questions only require discussion in this case. .The claimant was allowed a sum against the estate of the intestate, and the defendant has brought the cause to this court. The claim relates to money expended and services rendered for the intestate. It was claimed by the defendant that the services were rendered under an agreement by which the claimant was to pay $2.50 per week and do-certain work for the deceased for his board. We think this was not conclusively shown, and that there was evidence to go to the jury in support of the claim. Upon the cross-examination, the claimant was asked if he had not stated upon a former examination that he was engaged to be married to the decedent, who was an elderly woman, and he said that he had. He also testified, in answer to the questions of defendant’s counsel, that he stated that, when he went to live with Mrs. Barrett, he was to pay $2.50 for his board, and was to do certain work for her in addition to that, viz., do the chores and look after the garden. On redirect, he testified that this agreement related to a time when he was working (presumably at his avocation), and that it was not to include any of his services continuously. This testimony was objected to as inadmissible under the statute excluding testimony' as to matters equally within the knowledge of the deceased.

Counsel for the defendant saw fit to interrogate the claimant as to alleged admissions about the contract, and, by direct questions, compelled him to admit that he said under oath that he agreed to pay $2.50 a week for board, and do some work for the deceased, but apparently sought to preclude him from showing the full terms of the contract. In other words, they sought evidence out of his own mouth of so much of the contract as would benefit the estate, and attempted to exclude the things that would benefit the claimant. The statute in question was designed to protect estates, by excluding the testimony upon the subject known equally to the claimant and the deceased party. If, however, the representative of the deceased wishes, he may compel the living party to testify; but in that case he cannot prevent such party from giving- a full explanation of the subject inquired about. Can he avoid this by relying upon his admissions to prove the contract ? In this case the defendant has not called the claimant as a witness, nor has he interrogated him about the terms of the contract. He has ingeniously avoided it by asking him, not what the contract was, but what he had admitted it to be upon another occasion. This was to all intents and purposes requiring the witness to testify upon the subject, for manifestly he might as well have said to the jury that those statements were true as to have said that he made them on a former trial, when under oath. It is clear that they went to the jury with all the force of direct statements about the contract. When it is sought to explain them, he is met with the objection that his testimony is excluded by the statute, and the argument that he has not testified to the contract, or been asked to do so, but merely what he has theretofore testified under oath to be the contract. It is admitted that upon such former trial the door was opened to redirect examination, if his testimony was called out by the adverse party; but it is urged that upon this trial his redirect must be confined to what was said upon the former trial by .way of explanation of the fact, although he may not have made or been asked for an explanation before. Thus, the statute, which is designed as a shield for the protection of the estates of deceased persons, is made a sword in its hands.

The claimant had not attempted to give evidence about his relations with the deceased, or the subject-matter of the contract, presumably because it was not admissible under the statute. Had the counsel for the estate sought to cross-examine him upon these subjects, it would have been a waiver of the statute. It is contended, however, that they might show his admissions about the contract, and about his promise to marry the deceased. To do this by another witness might have been proper, but in such case they must have offered the testimony in defense, and subject to tbe right of cross-examination. As it was, they sought to show it by cross-examining the claimant upon a subject foreign to his direct examination. This was not a proper cross-examination, because it related to matters which he had not attempted to testify about, and which the law did not permit him to relate without the consent of the opposite party. It could only become proper by opening the door to his testimony upon the subject, which the estate might do. Again, if, as counsel say in the record, they simply asked the claimant what he had testified on a former occasion for the purpose of contradicting — i. e., impeaching — him, it was incompetent, for there was no occasion to lay a foundation for impeachment upon matter which he had not mentioned.

It is obvious that a statement tantamount to an admission relating to the subject-matter of the contract was obtained, whether it was expected or not, and there is nothing in the record to indicate that,' upon this testimony, counsel did not claim that the claimant’s right to compensation was limited to his board. In such a case the admission is no more nor less than the testimony of the party himself. It is, in effect, the calling of such party as a witness by and for the representative of the deceased party, who desires to prove the transaction by him; and why should it be said that he may have so much of such testimony as he wishes, without giving an opportunity for explanation of the subject, any more than where the party was sworn upon the trial? There would be little justice in so construing the statute as to permit counsel for the estate to prove a part of a transaction hy the claimant’s own testimony, and then close the mouth of the witness as to the remainder. That seems to be what was attempted in this case. The court correctly held that, when a subject is gone into under such circumstances, it may be explained fully by the witness on redirect examination; and we are of the opinion that the case before us was within the rule. Smith’s Appeal, 52 Mich. 415.

A witness named Jahnke was called on behalf of the estate, and stated that he had a talk with claimant, who showed him an order from George Barrett during a conversation which he had with him. The record indicates that the conversation was with reference to negotiations between claimant and said George Barrett, who was one of the heirs of the deceased, wherein they executed a writing whereby it was agreed that claimant would be paid and receive $100 in full of his claim. It turned out that Barrett had-no authority to bind the estate, and he was dead at the time of the trial. The court excluded the instrument and the testimony, upon the ground that it was an attempted compromise. At the same time, he offered to permit evidence of the claimant’s statements as to the nature or value of his services, and permitted testimony that he said that he would be satisfied with $100. We think the ruling of the court was correct. See Manistee National Bank v. Seymour, 61 Mich. 70, and cases cited.

There are other questions raised by the record, but we think they do not require discussion.

The judgment is affirmed.

The other Justices concurred.


text:
    BRABANT v. LILLIE.
    Loot Liens —Nonresident Owner — Service of Process —Justices’ Courts — Adjournment.
    While service of a writ of attachment in proceedings instituted in justice’s court to enforce a lien for labor on logs may, under 3 How. Stat. § 8437/, be made on the agent of the owner, where the latter is not the defendant named in the writ, and is a nonresident of the State, the plaintiff is bound in such case, under section 84277c, providing that the proceedings shall follow the general statute, “ except as herein otherwise provided,” to cause an adjournment to be taken for 30 days, in accordance with 2 How. Stat. § 6846.
    Case made from Menominee; Stone, J.
    Submitted April 7, 1898.
    Decided May 18, 1898.
    Trover by Joseph Brabant against James Lillie. There was a judgment for plaintiff, and defendant assigns error.
    Reversed.

      Sawyer & Waite, for appellant.

      Norwood Bowers, for appellee.
   Hooker, J.

James Lillie was a resident of the State of Illinois, but carried on business under the name of the Lillie Lumber Company at Talbot, Mich., where he owned timbered lands. In the winter of 1895 and 1896, one George Smith made a contract with Lillie to cut and get out certain forest products, and Smith employed the plaintiff to assist him, and the work was performed. On February 25, 1896, the statement of lien required by 3 How. Stat. § 84276, was duly filed; and on April 1, 1896, proceedings were commenced by attachment on his behalf, as provided in 3 How. Stat. § 8427/, against Smith. Judgment was rendered against Smith on the 16th day of April, 1896, for $24 and costs. The return shows that certified copies of the writ of attachment and inventory were served personally upon George Smith, and also upon the Lillie Lumber Company, by delivering the same to one Huebel, the agent of said company; that none of the members of the company resided or could be found within the State. The return bore no date. On September 11, 1896, a summons returnable September 16th was issued against James Lillie, and was seasonably served upon him personally. This was followed by a judgment in trover for the. conversion of the logs, from which a special appeal was taken to the circuit court, where it was affirmed, so far as the special questions were concerned; and, upon a trial of the merits before the circuit judge, plaintiff recovered a judgment of $36 and costs. Counsel assign error, alleging" that the court erred in admitting the original judgment, upon the ground that it was void, for the reason that there was no personal service upon defendant, nor an adjournment of the cause for 30 days, under 2 How. Stat. § 6846.

3 How. Stat. § 8427k, provides:

“All writs of attachment issued under the provisions of this act by any of the circuit oj justice courts of this State shall be served and returned as- ordinary writs of attachment are served and returned in said courts, respectively, except as herein otherwise provided; and the pleadings and all subsequent proceedings shall be the same as in other cases of attachment, except as herein otherwise provided.”

The service in this cause was not such as is provided by the justice act (2 How. Stat. §§ 6840, 6841); but it was according to the method specifically pointed out in 3 How. Stat. § 8427/, and was therefore excluded from the operation of section 8427k by the words “except as herein otherwise provided,” contained therein. This section, however, provides that all subsequent proceedings shall be the same as in other cases of attachment, except as therein otherwise provided; and there is nothing in the log-'lien statute, that we have found, that relieves the plaintiff from the necessity of causing an adjournment in accordance with 2 How. Stat. § 6846, where .the defendant is not personally served. The log owner was not a defendant in the sense of being a debtor; but he was to all intents and purposes a defendant, for his property was subject to seizure for the debt of another. Under section 8427/, service might be made as late as the return day, while under the justice act it must be made six days earlier. To hold that section 6846 has no application would subject a nonresident log owner, not served with process, to the danger of rendition of judgment against his property on the same day that service is made upon the agent, and upon the trial of the action against the debtor. Streeter v. McMillan, 74 Mich. 123.

The judgment is reversed, and a new trial ordered.

The other Justices concurred.


author: Per Curiam.

text:
    KENNARD v. LILLIE.
    Lou Liens — Service on Nonresident.
    Case ruled by Brabant v. Lillie, ante, 167.
    Case made from Menominee; Stone, J.
    Submitted April 7, 1898.
    Decided May 18, 1898.

      Assumpsit by August Kennard against James Lillie to recover the amount of a lien upon logs alleged to have been converted by defendant. There was a judgment for plaintiff, and defendant assigns error.
    Reversed.

      Sawyer & Waite, for appellant.

      Norwood Bowers, for appellee.
   Per Curiam.

Plaintiff brought suit against one George* Smith under the log-lien law, and attached certain logs and poles, which were the property of the defendant, Lillie. Lillie was a nonresident, and was doing business under the title of the Lillie Lumber Company. One Huebel was his agent. The writ of attachment was personally served on Smith, and on the return day the deputy sheriff returned that he ‘ ‘ had seized the property described, and that he had served a copy of the writ and inventory upon the Lillie Lumber Company, who claim interest or ownership in said property, by delivering to Huebel, the agent of said company, certified copies of said writ and inventory attached thereto; that none of said company resided in this State, and none could be found by him.” Neither the principal defendant nor Lillie, the log owner, appeared. On the return day, which was April 10th, after waiting one hour, the justice adjourned the case until April 16th, and sent a registered letter directed to the Lillie Lumber Company, notifying them that the case had been adjourned until the 16th, at 1 o’clock p. m. On the 16th, plaintiff appeared, and, after waiting one hour, the defendant not appearing, the justice took the evidence, and rendered judgment for $108.65.

The present suit was commenced September 11, 1896, personal service being had upon the defendant. The defendant did not appear, and subsequently took a special appeal to the circuit court. The court overruled the special causes, and thereupon trial was had upon the merits before the court, without a jury, and judgment rendered against the defendant for the amount of the judgment which had been rendered against Smith. The case is before this court upon a case made.

The case is ruled by Brabant v. Lillie, ante, 167, and is reversed.


author: Grant, C. J.

text:
    CROZIER v. ALLEN.
    1. Writ and Process — Service—Summary Proceedings.
    Under 2 How. Stat. § 8298, requiring service of the summons in summary proceedings to recover the possession of land to be made “at least two days before the time of appearance mentioned therein,” the day of service, as well as an intervening Sunday, is to be excluded, and the appearance-day included, in the computation.
    2. Same — Substituted Service — Jurisdiction.
    In such case, a return of substituted service, made before the expiration of the time within which personal service might lawfully be made, is insufficient to confer jurisdiction.
    Error to Kent; Adsit, J.
    Submitted April 26, 1898.
    Decided May 18, 1898.
    Case under 2 How. Stat. § 8806, by Alfred O. Crozier and another against Bernard Allen. From a judgment for defendant, plaintiffs bring error.
    Affirmed.

      Alfred O. Crozier, for appellants.

      Frank W. Hine, for appellee.
   Grant, C. J.

This suit is brought to recover treble damages, under section 8306, 2 How. Stat.

Defendant failed to pay rent when due. Notice to quit was served September 4th. He did not surrender possession. Plaintiffs on September 12th commenced summary proceedings to eject him. Summons was issued on the 12th, returnable the 17th. The officer, being unable to find the defendant, served the summons on Thursday, the 13th, by leaving a true copy of the same at his usual place of abode, in the manner provided by the statute, and made his return the same day. Defendant did not appear on the return day, and judgment for restitution was rendered. On the 17th and 18th of September, defendant removed his goods from the store, but did not surrender possession till the 27th. The court rendered judgment for the defendant.

Sunday intervened between the day of service and the day for appearance. The statute requires that the summons be served “at least two days before the time of appearance mentioned therein.” 2 How. Stat. § 8298. The service was void, and gave the commissioner no jurisdiction. Chaddock v. Barry, 93 Mich. 542 (18 L. R. A. 337). The language of the statute in the two cases is identical. Both parties concede that Sunday, the 16th, is to be excluded from the computation. Substituted service could not have been made till the 14th.

Judgment affirmed.

The other Justices concurred.


text:
    HOYT v. WAYNE CIRCUIT JUDGE.
    1. Libel — Amended Declaration.
    Amending the declaration in an action for libel, which sets forth the libelous article in full and claims general damages, by setting up special damages and defining by innuendoes the meaning of the alleged libelous publication, does not introduce a new cause of action.

      2. Pleading — Amendments—Discretion op Court.
    The matter of permitting amendments to pleadings rests in the discretion of the trial court.

      Mandamus by Edward C: Hoyt to compel Joseph W. Donovan, circuit judge of Wayne county, to permit relator to file an amended declaration.
    Submitted May 17, 1898.
    Writ denied May 18, 1898.

      George C. Eyre and Malcolm, C. Yerkes (Bacon & Palmer, of counsel), for relator.

      Elliott G. Stevenson and Leo M. Butzel, for respondent.
   Per Curiam.

The relator brought an action for libel against the Evening News Association, the publication of which was February 6, 1895. The original declaration was filed in February, 1897. It set forth the libelous article in full, and claimed general damages. Issue was duly joined, and the case was ready for trial, .when, on January 24, 1898, plaintiff asked leave to file an amended declaration setting forth special damages, and by innuendoes defining the meaning of the language in the alleged libelous publication. The court refused to allow the amendment; apparently basing his decision upon the ground that it introduced a new cause of action, barred by the statute of limitations. We think it did not introduce a new cause of action, and that it was within the discretion of the court to allow or disallow. We will not interfere with that discretion, when it is exercised. We assume that the judge will exercise his discretion upon this intimation, and we will not, therefore, direct the issuing of the writ of mandamus.


author: Montgomery, J.

text:
    KNEELAND v. WOOD.
    1. Taxes — Attempted Payment — Remedy against Deed — Ejectment — Evidence.
    While a good-faith attempt by a landowner to pay his taxes to the proper officer, which attempt is rendered unavailing by the mistake or fault of the latter, is equivalent to a payment, entitling the former to the benefit either of section 70 or of section 98 of the tax law (Act No. 206, Pub. Acts 1893), providing, respectively, that the court may set aside a sale, in case the tax had been paid, upon application made by the owner within one year after receiving notice of the sale, and that the auditor general, on discovering that a tax had been paid before sale, may withhold a conveyance or issue a certificate of error, as the circumstances may require, the owner must resort to one or the other of the remedies so prescribed, and,- not having done so, cannot set up the facts to defeat an action of ejectment brought by the holder of the tax deed.
    2. Same — Authority oe Auditor General.
    The auditor general, in determining the facts as the basis for his action under the .last-mentioned section, may consider any competent proofs, subject to a review by the courts in a proper proceeding.
    Error to Grand Traverse; Corbett, J.
    Submitted April 6, 1898.
    Decided May 18, 1898.
    Ejectment by Fred A. Kneeland and John H. Cole against Lizzie C. Wood and Hiram D. Wood. From a judgment for defendants, plaintiffs bring error.
    Reversed.

      Tweddle & Cross, for appellants.

      Pratt & Davis, for appellees.
   Montgomery, J.

This is an action of ejectment. Plaintiffs rely on a deed from the auditor general. The land was sold after the decree for the taxes of 1893. Defendants, who held the original government title, offered testimony tending to show that defendant Hiram D. Wood called at the office of the township treasurer, and was told by him, after examination, that no taxes were^ assessed on the premises in question. The circuit judge charged the jury that, if this fact was established', defendants were entitled to a verdict. The jury so found, and the plaintiffs bring error.

It is not shown that any steps had been taken to have the deed to plaintiffs canceled. We think the court was in error in admitting this defense. Section 70 of the tax law (Act No. 206, Pub. Acts 1893) provides that: “No sale shall be set aside after confirmation, except in cases where the taxes were paid,' or the property was exempt from taxation. In such casés the owner of such lands .may move the court at any time within one year after he shall have notice of such sale, to set the same aside, and the court may so order upon such terms as may be just.” Section 98 provides that if the auditor general shall discover, before a conveyance off said land is executed, either that the lands were not subject to taxation, or that the taxes had been paid to the proper officer before sale, or that a certificate that no taxes were charged against the land has been given to the owner, he shall withhold a conveyance, and that, if such a discovery be made after conveyance, a certificate of error shall be given. In Wood v. Bigelow, 115 Mich. 123, we held these two remedies to be concurrent. The question presented here is whether the original owner,, without resorting to either, may defeat the title of the purchaser under a tax decree by showing on the trial of an action of ejectment that the tax has been paid, or, what is perhaps equivalent, that the owner has attempted to make payment, and that such attempt has proved unavailing through the fault of the officer whose duty it was to receive it. We think not. It is no hardship to require the owner to pursue one of the prescribed remedies before he shall be permitted to attack the decree.

Under section 98 no limit of time is fixed within which the auditor general may act. It becomes important to determine whether the facts shown by the defendants are such as to entitle them to have a certificate of error on a proper application, as, if such course is attempted, the question of the jurisdiction of the auditor general to act will necessarily arise upon another trial of this case, if one be found necessary. We think the provisions of this section should receive a liberal construction, to the end that a taxpayer justly entitled to relief may not be cut off from all remedy. Hand v. Auditor General, 112 Mich. 597. It is held in numerous cases that, if a landowner in good faith applies to the proper officer for the purpose of paying his taxes, and is prevented by the mistake, wrong, or fault of the officer, such attempt to pay is equivalent to payment. Breisch v. Coxe, 81 Pa. St. 336; Gould v. Sullivan, 84 Wis. 659 (20 L. R. A. 487, 36 Am. St. Rep. 955); Edwards v. Upham, 93 Wis. 455; Loomis v. Pingree, 43 Me. 299; Forrest v. Henry, 33 Minn. 434; Kinsworthy v. Austin, 23 Ark. 375. As there is no' provision as to how the fact of payment shall be made to appear, it must be held that the auditor general may satisfy himself of the fact of payment (or, as in this case, attempt to pay rendered unavailing through the fault of the officer) by any competent proof, subject to review by the courts in a proper proceeding.

For the error pointed out, the judgment is reversed, with costs.

The other Justices concurred.