text:
    BOOTH FISHERIES CO. v. ALPENA CIRCUIT JUDGE.
    1. Compromise and Settlement — Correction op Error — Equity.
    On motion to vacate a stipulation filed in certain replevin oases reoiting a settlement of the litigation and discontinuing them without costs, no fraud, concealment, or mutual mistake being charged, the court in which the cases were pending was without jurisdiction to correct the alleged compromise; equity alone had jurisdiction to correct any mistake claimed to have been made.
    2. Same — Mistake.
    Settlements of disputed matters are favored by the law and will not be set aside for mistake of one of the parties as to the legal effect of the compromise.
    3. Same — Bona Fide Claimants — Fraud.
    As against the rights of strangers to the litigation subsequently intervening, the compromise will not be vacated on mandamus.
    .Mandamus by the Booth Fisheries Company against Frank Emerick, Alpena circuit judge, to compel respondent to vacate an order settling issues on a motion made in certain actions pending in said circuit.
    Submitted April 2, 1912.
    (Calendar No. 24,814.)
    Writ granted May 3, 1912.
    Rehearing denied October 7, 1912.

      Campbell, Bulkley & Ledyard and Joseph H. Cobb, for relator.

      Henry K. Gustin, for respondent.
   Brooke, J.

Relator asks for a writ of mandamus requiring respondent to vacate and set aside an order made by him settling certain issues and ordering them to be tried in a certain case in which relator was plaintiff and the Thunder Bay Fish Company and Horatio Ferguson were defendants. It appears that relator brought its action in replevin against said defendants, on August 11, 1909, to recover certain property theretofore sold by its predecessor in title to one of said defendants, under a contract which provided that the vendor should retain the legal title thereto and have the right to repossess itself thereof upon default of the vendee. A second like action was brought by relator on August 26, 1909; some property having been omitted from the first writ. On September 27, 1909, a portion of the property taken under the writs was sold. At said sale, the tug “Duchess” and her equipment was purchased by I. S. Canfield, defendant’s attorney, and certain other of the property was bid in by plaintiff. On the same day, September 27th, and' on October 4th, following, said defendant Ferguson brought two suits in replevin against relator and thereunder recovered possession of the property not sold, which was involved in the earlier replevin suits. Negotiations for an adjustment were then had between Mr. Joseph H. Cobb, acting as attorney for relator, and Mr. I. S. Canfield, acting as attorney for the opposite parties in interest. A settlement was agreed upon, the details of which it is unnecessary to set out, and on the 22d day of December, 1909, a stipulation was entered into in each of the four replevin cases. The stipulations in those cases where relator was plaintiff were as follows:

“ The subject-matter in the above-entitled suit having been settled between the parties, it is hereby stipulated between Joseph H. Cobb, attorney for complainant, and I. S. Canfield, attorney for defendants, that the same be discontinued without cost to either party and the clerk is hereby authorized to enter the order in the journal to that effect.
“Joseph H. Cobb,
“Attorney for Complainant.
“ I. S. Canfield,
“Attorney for Defendants.
“ Dated December 22, 1909.”

The stipulations in those cases where relator was defendant were identical with the foregoing, except that the parties were reversed as plaintiff and defendant. These stipulations were filed January 5, 1910.

On September 27, 1909, the day of the sale, the Thunder Bay Fish Company had begun suit against relator by causing a summons to issue in an action of trespass on the case. On February 1, 1910, the declaration therein was filed, and on June 2, 1910, defendant (relator herein) filed a demurrer and notice and motion. On November 17, 1910, defendant filed an amended plea and notice. On the same day, the Thunder Bay Fish Company made a motion in the original replevin suit wherein relator was plaintiff and which had been settled by stipulation as follows:

“Now come the above defendants and move the court to strike from their files thereof a stipulation dated December 22, 1909, and filed with the clerk of said court the 5th day of January, 1910, discontinuing said suit for the following reasons:
First. Because the subject-matter in the above-entitled suit has not been settled between the parties.
“Second. Because said stipulation was signed under misapprehension by I. S. Canfield, attorney of record for the defendants.
Third. Because there was no consideration for the making of said stipulation.
Fourth. Because the defendants will lose substantial rights and irreparable injury will be done the defendants if said stipulation is not set aside and said suit tried upon its merits.
“Fifth. Because the said defendants Thunder Bay Fish Company did not know that said stipulation had been signed until long after said stipulation had been filed, and said Thunder Bay Fish Company were advised that the discontinuance of said suit did not in any way affect their interest and were advised that all damages they were entitled to could be recovered in the damage suit now pending in the circuit court for the county of Alpena, in which the Thunder Bay Fish Company is plaintiff, and the Booth Fisheries Company is defendant.
“Sixth. Because it was agreed and understood between the attorneys for the plaintiff and the attorneys for the defendant in the above-entitled case that nothing in the said stipulation contained should or would be construed to in any wise affect the Thunder Bay Fish Company’s right of action against the Booth Fisheries Company.
“Seventh. Because the defendants have a good and meritorious defense to the above-entitled cause.- This motion is based upon the files and records in said cause and the affidavits hereto annexed and made part of this motion.
“H. K. Gustin, Attorney for Defendants.
“ Dated 17th of November, 1910.”

Two grounds were added on December 6, 1910, as follows : '

“Eighth. Because I. S. Canfield had no authority to enter into any agreement, contract, or stipulation on behalf of the Thunder Bay Fish Company to discontinue said suit or to make any agreement, stipulation, or settlement on behalf of the Thunder Bay Fish Company with the Booth Fisheries Company.
“Ninth. Because the subject-matter in the above-entitled suit had never been settled and no contract or agreement to settle had ever been made between the parties to the above-entitled suit.”

To this motion relator filed a reply supported by affidavit denying the material statements contained in the motion and detailing at large the facts and circumstances surrounding the settlement. Whereupon the court made the following order:

“Motionhaving been heretofore made and entered in this cause to set aside and strike from the files a stipulation theretofore filed herein, it is hereby ordered by the court that the following issues be andaré hereby settled by the court, to wit:
“Issue No. 1. Has the subject-matter in the above-entitled suit been settled between the parties ?
“ Issue No. %. Did I. S. Canfield have authority to make an agreement of settlement and discontinuance on behalf of the Thunder Bay Fish Company ?
“ Issue No. 3. Did I. S. Canfield, if he had authority to make an agreement of settlement on behalf of the Thunder Bay Fish Company, enter, into a valid agreement of settlement upon the 10th day of December, 1909, with the Booth Fisheries Company ?
“ Issue No. 4. Did the Thunder Bay Fish Company receive any consideration to settle said suit ?
“ Issue No. 5. Was said stipulation signed under misapprehension by I. S. Canfield ?
“ Said issues are ordered to be tried before the court or by a jury at the election of either party hereto, upon Monday, the 29th day of May, 1911. It is further ordered that a certified copy of this order and issue shall be served upon the attorney of record for the plaintifE on or before the 5th day of May, 1911.”

The circuit court having refused, upon application, to vacate said order, this application for mandamus is made in this court.

It is urged on behalf of relator that, if any ground exists for rescinding said agreement of settlement (which relator denies), such matter constitutes a new cause of action which must be brought in a court of equity.

Upon the record as presented, we are satisfied that a settlement was made, and that the several stipulations of discontinuance were filed as a result of such settlement. Neither fraud, concealment, nor mutual mistake are set up as grounds for the setting aside of the stipulations, and if such allegations had or could be made under the facts, they would, we think, properly address themselves to a court of equity. The claim of the Thunder Bay Fish Company is in effect that it settled the replevin suits in question under a misapprehension as to the legal effect such settlement would have upon its suit then pending against relator. The jurisdiction of a court of equity, upon proper averments, to open and correct a compromise and settlement, is clear. Mayhew v. Insurance Co., 23 Mich. 105; Tabor v. Insurance Co., 44 Mich. 324 (6 N. W. 830); Heinlein v. Insurance Co., 101 Mich. 250 (59 N. W. 615, 25 L. R. A. 627, 45 Am. St. Rep. 409); 8 Cyc. p. 523, and cases cited.

Settlements of disputed matters and compromises of unsettled claims are favored by the law, and it will be presumed that parties consult their own interests in making them. Usually they will not be interfered with in the absence of fraud or mutual mistake, and then only when the party who seeks to rescind returns to the other party what he has received by virtue of the settlement. Niederhauser v. Railway Co., 131 Mich. 550 (91 N. W. 1028), and cases there cited. Nor will such settlement be set aside because one of the parties did not understand it or its legal effect. Pratt v. Castle, 91 Mich. 484 (52 N. W. 52); Lauzon v. Belleheumer, 108 Mich. 444 (66 N. W. 345).

It is, we think, clear from the record as presented that the parties cannot now be placed in the position they occupied before the settlement was made; rights of third persons, strangers to the litigation between the parties, having intervened. Under such circumstances, and in the absence of fraud, the settlement should not be disturbed. 1 Beach on Contracts, § 454; McNeill v. Town of Andes (C. C.), 40 Fed. 45; Emerick & Duncan Co. v. Hascy, 146 Fed. 688, 77 C. C. A. 114.

The writ of mandamus will issue directing the respondent to vacate and set aside the order settling the issues and ordering a trial thereof.

Moore, C. J., and Steere, McAlvay, Blair, Stone, and Ostrander JJ., concurred. Bird, J., did not sit.


source: Caselaw Access Project

author: Steere, J. Ostrander, J. Brooke, J.

license: Public Domain

text:
    BATEMAN v. CASE.
    Wills — Devise to Wife — Libe Estate.
    Under a provision of decedent’s will bequeathing to his wife his entire estate, with authority to use or sell all or any portion thereof, without license from the court, granting any part remaining after her death to his sons, the widow took a life estate with power to alienate for her own use and benefit, and the remainder vested in the sons. Ostrander and MoAlvav, JJ., dissenting.
    Appeal from St. Joseph; Yaple, J.
    Submitted April 10, 1912.
    (Docket No. 90.)
    Decided June 1, 1912.
    Bill by Charles C. Bateman and others against Fred H. Case, executor of the estate of Harriet M. Bateman, deceased, for the construction of the will of David M. Bateman, deceased. From a decree for complainants, defendant appeals.
    Affirmed.

      E. M. Irish,, for appellant.

      George H. Arnold, for appellees
   Steere, J.

The purpose of this suit is to obtain a construction of the will of David M. Bateman, deceased. The question is raised by demurrer to complainants’ bill and is brought to this court by appeal taken from an order of the circuit court overruling said demurrer.

The bill of complaint states that David M. Bateman died October 6,1901. He left two sons, the complainants herein, and a widow, Harriet M. Bateman, stepmother of complainants. His will, dated September 26, 1900, contains but three clauses; the first of which merely provides for the payment of his lawful debts. The second and third, which are in controversy, are as follows:

“(2) I give, devise and bequeath unto my wife, Harriet M. Bateman, all of my estate, both real and personal, and I do hereby empower her, my said wife, to sell and dispose of all or any part of my said estate and convey the same by deed or otherwise without obtaining license from the court for this purpose; and I especially desire that my said wife shall have the right to use the whole or any part of my said estate for her own use and benefit.
“ (3) If any of my said real or personal estate shall remain after the decease of my said wife, then in this case I give, devise and bequeath all the rest, residue and remainder of my said estate so remaining unto my sons, Charles C. Bateman and Halbert E. Bateman, their heirs and assigns forever, share and share alike.”

An inventory of testator’s estate, filed in the probate court by his widow, who properly qualified as executrix, contained, among other things, the following:

“Osceola Consolidated Mining Co., 10 shares, $820; Holland Sugar Co., 100 shares, $1,000; National Loan & Trust Co., Detroit, $1,212.97.”

On the 8th day of December, 1907, said Harriet M. Batement died testate. An inventory of her estate filed in the probate court by defendant contained, among other things, the following:

“Osceola Consolidated Mining Co., 10 shares at $80, $800; Holland Sugar Beet Co., 126 shares at $19, $2,394; National Loan & Investment Company, stock, $1,275.”

Complainants, claiming these assets, made demand upon defendant therefor,which demand was refused on the ground that the same belonged to the estate of Harriet M. Bateman, deceased. The complainants pray for an accounting and that said defendant may, by decree of the court, be required to assign and transfer to complainants such assets.

Defendant demurred to said bill on the ground that the will of David M. Bateman vested an absolute title to all his estate in said Harriet M. Bateman; that complainants had no interest in her estate and she left no property to which they are entitled.

It is contended in behalf of defendant that the second clause of the will vested an absolute title in Harriet M. Bateman which cannot be affected by the third clause; the latter being only advisory in its nature under the general rule that, where an estate is given to a person generally or indefinitely, with power of sale or disposition, it carries an absolute title; citing the following cases: Jones v. Jones, 25 Mich. 401; Moran v. Moran, 143 Mich. 322 (106 N. W. 206, 5 L. R. A. 323, 114 Am. St. Rep. 648); Killefer v. Bassett, 146 Mich. 1 (109 N. W. 21); Turnbull v. Johnson, 153 Mich. 228 (116 N. W. 1009); Dills v. La Tour, 136 Mich. 243 (98 N. W. 1004).

On behalf of complainants it is urged that, construing the will as a whole, it gives the widow but a life estate in the property of her husband, with power to sell or consume for her own use and benefit; that such power ended with her life, and any remaining portion of the testator’s estate in regard to which she had not exercised that power became theirs under the third clause of the will, with present right of possession and enjoyment; in support of which the following cases are cited: Morford v. Dieffenbacker, 54 Mich. 593 (20 N. W. 600); Gaukler v. Moran, 66 Mich. 353 (33 N. W. 513); Glover v. Reid, 80 Mich. 228 (45 N. W. 91); Cousino v. Cousino, 86 Mich. 323 (48 N. W. 1084); Jones v. Deming, 91 Mich. 481 (51 N. W. 1119); Defreese v. Lake, 109 Mich. 415 (67 N. W. 505, 32 L. R. A. 744, 63 Am. St. Rep. 584); Gadd v. Stoner, 113 Mich. 689 (71 N. W. 1111); Robinson v. Finch, 116 Mich. 180 (74 N. W. 472); Austin v. Hyndman, 119 Mich. 615 (78 N. W. 663); Clark v. Mack, 161 Mich. 545 (126 N. W. 632).

To the cases cited by counsel for the respective parties many more might be added involving similar issues both from our own State and other jurisdictions. They present an endless variety of wills, many of them containing expressions and provisions similar to the ones under consideration, but none identical in all particulars. It is seldom that the effective parts of any two wills are alike, and the authorities cited and consulted do not present a case which fully quadrates with the one before us, though from such precedents some general principles in aid of construction may be deduced. In the early, case of Sisson v. Seabury, 1 Sumn. 235, Fed. Cas. No. 12,913, Judge Story thus speaks of the embarrassment attending resort to precedent in construing wills:

" The cases almost overwhelm us at every step of our progress; and any attempts even to classify them, much less to harmonize them, is full of the most perilous labor. * * * To lay down any positive and definite rules of universal application in the interpretation of wills, must continue to be, as it has been, a task, if not utterly hopeless, at least of extraordinary difficulty.”

The construction of a will is not merely determining the meaning of a word or phrase found in it, or ascertaining the sense of a particular sentence or form of words, though both are involved, but it demands the drawing of siich conclusions from the whole as are manifestly within the spirit of the text, though they may be beyond the direct expressions there found. It is the substance rather than the form which is to be considered. Toms v. Williams, 41 Mich. 552 (2 N. W. 814). The construction should always be in harmony with the expressed or implied intention of the testator unless contrary to some positive rule of law. The principle is clearly stated by Justice Moore in Robinson v. Finch, 116 Mich. 180 (74 N. W. 472):

“ The first thing to determine is, What was the intention of the testatrix, as expressed in the instrument, taking it in its entirety, giving to the words used the meaning which it is evident the testatrix gave to them ? for it is the cardinal principle of interpretation of wills to carry out the intention of the testator, if it is lawful and can be discovered. Bailey v. Bailey, 25 Mich. 185; Eyer v. Beck, 70 Mich. 181 (38 N. W. 20); Glover v. Reid, 80 Mich. 233 (45 N. W. 91); Schehr v. Look, 84 Mich. 263 (47 N. W. 445); Cousino v. Cousino, 86 Mich. 323 (48 N. W. 1084); Jones v. Deming, 91 Mich. 481 (51 N. W. 1119). * * * In Hamlin v. United States Express Co., 107 Ill. 443, it is said:
“ ‘ The latter part of the will is to be considered no less than the former part, and, to the extent there is repugnance, the language of the former part is to be read as modified by that of the latter part.’

“ See, also, Barnes v. Marshall, 103 Mich. 348 (60 N. W. 468); Gadd v. Stoner, 113 Mich. 689 (71 N. W. 1111).”

See, also, Page on Wills, § 470; Schouler on Wills, 559.

Considering the question before us with these cardinal principles in mind, we have no hesitation in gathering from the four corners of this will a definite intention on the part of the testator to give into possession of his widow all his property for her to freely enjoy, and have the benefit of, so long as she might survive him, even to the extent of selling or consuming the whole or any part thereof, but with the limitation that it was a personal matter to her; that he intended the consumption, sale, or disposition authorized should be to that end — for her own special use and benefit, and not that of another — that what was left, if any, on her death should go to his own sons and not to strangers. If this manifest intention does not, in the manner of expressing it in the will, directly contravene some of the decisions of this court or some positive rule of law, it should control.

The fact that the entire estate might be disposed of or consumed by her, and there be no remainder, would not militate against a bequest of a contingent legacy to his sons. It would vest in them in prospect, or in remainder, subject to being divested in case the entire estate was exhausted by the previous beneficiary during her lifetime under the power given. McCarty v. Fish, 87 Mich. 48 (49 N. W. 513); In re Mallary’s Estate, 127 Mich. 119 (86 N. W. 541, 89 N. W. 348).

Few technical words are found in the second clause of the will. While several of the words used have a technical meaning, most are words in common use. Terms used in wills are generally to be construed as bearing the meaning ordinarily and commonly accepted. Rivenett v. Bourquin, 53 Mich. 10. To give this clause the construction contended for by defendant, we must not only eliminate the third clause, but the last half of the second also. Had it been the intention of the testator to give his property to his wife absolutely and without limitations, it would seem a strange and unnatural thing for him to specify that she could sell the same without license from the probate court; but, if it was his intention to confer upon her only a life estate and limit the disposition and sale of all or any part of this property to her own use and benefit, then the precaution of relieving her from appealing to the probate court, though perhaps not necessary, becomes natural and even significant.

The extrinsic circumstance that Harriet M. Bateman was the second wife of testator, and not the mother of complainants, is proper to consider in construing his will. We can infer from the language of the will that she was the first object of his solicitude, and he intended to fully provide for her so long as she survived, even though it exhausted the estate to the exclusion of his children. The language of the third clause negatives any intent that whatever remained might pass to strangers by will or inheritance to the exclusion of his sons. If the contention of defendant is correct, the sons were disinherited, the property became absolutely hers the moment he died, and, had she died an hour later, all would have gone to her heirs to the exclusion of his offspring, to whom he clearly expressed the intent it should go. The construction of a will should be in favor of natural and reasonable disposition and conform as nearly as language will permit to the general rule of inheritance, and the heir is not to be disinherited without an express devise or necessary implication.

No words of inheritance are found in the second clause of the will, which provides for the widow, as there are in the third, which provides for the sons. The third concludes, “Their heirs and assigns forever, share and share alike.” The second concludes, “The right to use the whole or any part of my said estate for her own use and benefit.” She could neither use nor be benefited by it after her death. When her life ended, that right ended.

Under well-settled rules of construction, as stated and elaborated in the authorities cited and relied on by defendant, a limitation over to complainants would be void for repugnancy if the primary gift to the widow vested in her an absolute and unqualified title to the property, with unlimited power of alienation and disposition. We do not find such was the real intent of the testator, as expressed in the will, when all its parts and clauses are considered together in the light of the relations the respective parties in interest bore to each other, but rather a life estate, with power of alienation and disposition for the specific and limited purpose of the widow’s “ own use and benefit,” burdening the estate to furnish that which might be useful and beneficial to her while she lived, followed by a distinct and unequivocal mandate that, if not all consumed for that purpose, the remainder should go to his two sons, his legal heirs and natural objects of his bounty

We think this case controlled by the reasoning and rules stated in Gadd v. Stoner, 113 Mich. 689 (71 N. W. 1111); Robinson v. Finch, 116 Mich. 180 (74 N. W. 472).

The decree is affirmed, with costs.

Moore, C. J., and Blair and Stone, JJ., concurred with Steere, J.

Ostrander, J.

(dissenting). In my opinion, the case is ruled by Jones v. Jones, 25 Mich. 401, and the decree overruling the demurrer should be reversed and a decree entered sustaining the demurrer.

McAlvay, J., concurred with Ostrander, J.

Brooke, J.

I agree that this case falls within Jones v. Jones, supra, but think that case should be squarely overruled. The decree should be affirmed.

Bird, J., did not sit.


author: Moore, C. J. Stone, J.

text:
    CONTINENTAL NATIONAL BANK OF CHICAGO, ILLINOIS, v. FLEMING.
    1. Usury — Mortgages—Interest—Statutes.
    Usury, consisting in the reservation of a greater rate of interest than the law permits (1 Comp. Laws, §§ 4857, 4858), is shown to have been unlawfully provided for by an agreement, separate from notes and mortgages upon defendant’s property, and executed prior to said instruments stipulating for certain sums to be paid as salaries by the mortgagee to two persons to be named by the creditor as directors of the debtor corporation, the arrangement being intended as a substitute for a bonus of |6,000 originally proposed by the creditor.

    3. Same.
    The fact that the salaries were not actually paid is not controlling.
    3. Same — Intent.
    Where the creditor intends to secure more interest than the law authorizes, no disguise will avail to render the transaction lawful.
    4. Same.'
    Where the evidence showed that an arrangement to pay an usurious bonus upon a mortgage was entered into between the parties, the interest on the obligation was forfeited, and interest payments made by the mortgagor should be credited, in a foreclosure suit, upon the principal.
    Moore, C. J., and Brooke, J., dissenting.
    Appeal from Delta; Cooper, J., presiding.
    Submitted June 22, 1911.
    (Docket No. 8.)
    Decided February 10, 1912.
    Rehearing denied June 1, 1912.
    Bill by the Continental National Bank of Chicago, Illinois, and Edward Hines Lumber Company against John C. Fleming, Cyrus A. Barker, the Garth Lumber & Shingle Company, and other defendants, for the foreclosure of a mortgage. From a decree for complainants, defendants the Garth Lumber & Shingle Company and Cyrus A. Barker appeal.
    Modified and affirmed.

      F. D. Mead (Newman, Northrup, Levinson & Becker and Chester E. Cleveland, of counsel), for complainants.

      Arthur H. Byall and C. B. Empson for defendants Garth Lumber & Shingle Company and Cyrus A. Barker.

       Usury as affecting receipt of commercial paper as payment, see note in 35 L. R. A. (N. S.) 72.

   Moore, C. J.

(dissenting). The bill in this case was filed to foreclose a mortgage dated December 24,1907, given by the Garth Lumber & Shingle Company, by C. A. Barker, its president, and running to the complainants above named, and the Bank of D. Hammel & Son and the first State Bank of Petoskey, to secure the payment of the following notes: One to the Bank of D. Hammel & Son for $5,500; one to the First State Bank of Petoskey for $8,500; one to the Continental National Bank of Chicago for $20,000; one to the Edward Hines Lumber Company for $30,000. All of the notes bore even date with the mortgage. There was a trial in open court which resulted in a decree in favor of the Continental National Bank, Edward Hines Lumber Company, and John C. Fleming, as assignee of the First State Bank of Petoskey, and the Bank of D. Hammel & Son for the amount due them respectively on the notes set up in the bill. The defendants C. A. Barker and the Garth Lumber & Shingle Company in their answer alleged that the transaction, especially with respect to the claims of the Continental National Bank and the Edward Hines Lumber Company, was tainted with usury. The defendant Garth Lumber & Shingle Company has prosecuted this appeal.

Counsel are agreed that the important question is whether the defense of usury was established.

In 1906 the Garth Lumber & Shingle Company was incorporated. Two men owned one share each of the stock. All the other shares of stock were owned by Cyrus A. Barker. The three shareholders were directors. Mr. Barker was president, and for all practical purposes was the company. This company in 1906 made a contract with the Edward Hines Lumber Company to sell to it a large quantity of lumber to be manufactured during the sawing season of 1907. Within three months after this contract was made, the Hines Lumber Company made advancements to the Garth Lumber & Shingle Company reaching nearly, if not quite, $35,000. There were also other creditors of the Garth Lumber & Shingle Company, including the complainant bank. The Hines Lumber Company was not satisfied with the conduct of the business of the Garth Lumber & Shingle Company, and, after an examination by some of its experts, and various conferences, what is known as a working agreement was made November 14, 1906. A more extended reference will be made later to this agreement. After this agreement was made, the two lumber companies had very extensive dealings with each other. Finally the mortgage which it is sought to foreclose in this proceeding was made. On the same date the following paper was signed:

“ Chicago, December 33, 1907.
“Cyrus A. Barker, President.
“Dear Sir:
“ In the mortgage this day given by you to our company and others upon lands of the Garth Lumber & Shingle Company in Delta and Alger counties, Michigan, the indebtedness to our company is stated to be $30,000.
“We now agree that if upon an accounting it is shown that there is a less amount due to our company we will indorse the differences between the $30,000 and the amount so actually due, as a credit upon the note as of its date.
“ It is understood that certain of the lands covered by the mortgage have been heretofore conveyed, and that in such cases the land shall be released from the mortgage if they have been paid for in full.
“Very truly yours,
“Edward Hines Lumber Co.
“By C. F. Wiehe, Sec’y.
“ I agree to the above.
“ C. A. Barker.”

It is conceded, that there is nothing in the mortgage indicating usury; but that defense is based upon the working agreement to which reference has been made, and to what was said and done at the time it was executed. It therefore becomes important to refer more in detail to this agreement. It in the beginning recites the relations of the parties to each other. It then provides that:

“ Now it is agreed between the parties hereto as follows :
“ (1) The stockholders agree to at once indorse the certificates for the shares of the capital stock held by them respectively, and to transfer the same to Charles L. Allen, to be held by him for the purpose of managing and voting the same in accordance with the terms of a power of attorney, or trust agreement to be executed by said stockholders, when such deposit is made satisfactory to the attorneys of the creditors, such stock to be voted by Charles L. Allen at any corporate election for the election of Cyrus A. Barker, 0. F. Wiehe, and George M. Reynolds as directors of said company during the continuance of this agreement. The object of said deposit and trust agreement is to more fully and effectually carry out the objects of this agreement primarily to give the creditors during the continuance of this agreement a majority of the board of directors of said company. O. F. Wiehe and George Reynolds above named represent said creditors, and Cyrus A. Barker represents said company. * * * Two of the present board shall at once successively resign and said C. F. Wiehe and George M. Reynolds shall be elected in their place.
“(2) The board of directors so chosen shall have full, absolute and uncontrolled right to conduct the business of said company, as it may see fit. * * *
“(3) Cyrus A. Barker agrees to give his entire time and attention to the conduct of the business of the company during the term of this agreement, and in such manner as may be directed from time to time by the board of directors mentioned in paragraph 1 hereof. It is agreed that there shall be paid to the said Barker as compensation for such services, during the period of this agreement, the sum of two hundred and fifty dollars per month. He also agrees that, as president of the company, he will not incur any obligations on account of the company in excess of the sum of five hundred dollars, without the consent of one of the other directors of said company, and that he will not make sales of any of the property of the company in excess of fifteen hundred dollars at any one time, without the consent of the Edward Hines Lumber Company.
“ (4) Each of the other directors of said company elected as provided under the terms hereof, shall receive a salary at the rate of two thousand dollars per year, payable monthly, and a proper resolution shall be passed by the board of directors to that effect.
“ (5) Subject to the conditions hereinafter stated, the creditors agree that the time for payment of claims of such creditors shall be, and the same are hereby extended until December 1, 1907, from the date hereof, with the privilege to the company, however, to prepay said obligations or to make payments on account thereof at any time during the extended period. Wherever the claims of creditors are represented by notes, said notes shall be surrendered and new notes shall be given for the extended period, or the notes now held shall be indorsed to show such extension.”

It will not be necessary to set out the other provisions of the working agreement.

It is the claim of Mr. Barker and the Garth Lumber & Shingle Company that the provision in the contract that Mr. Reynolds and Mr. Wiehe should be paid a salary of $2,000 each was a mere cover to conceal usury. On the part of the complainants it is insisted that this provision was made in good faith, and as compensation for services which it was expected would actually be rendered. It is further insisted that Mr. Reynolds did in fact render some service for which he was paid $166.66, and that, as he regarded that as adequate compensation he declined to take any further pay. Mr. Wiehe insists that while he drew his salary monthly at the rate of $2,000 a year, he fully earned it. It is further insisted that not one dollar ever went to either of the complaining companies except for actual advances and the interest thereon which was agreed upon.

It is conceded that there is nothing upon the face of the working agreement that is illegal, but that the parol testimony shows that the contention of Mr. Barker and the Garth Lumber & Shingle Company is true. The oral testimony is somewhat conflicting.- It was taken for the most part in open court. The judge who saw the witnesses states in the decree as follows:

“That the transactions which resulted in the giving of said notes and mortgage were not usurious and that no illegal sums as compensation for the use of money represented and secured by the said notes and mortgage were included in or became a part of said mortgage.”

It must not be forgotten that this is not a proceeding to enforce the provisions of the working agreement, but is a proceeding to foreclose a mortgage given long afterward, at which time it was agreed in writing:

“We now agree that if upon an accounting it is shown that there is a less amount due to our company we will indorse the differences between the $30,000, and the amount so actually due, as a credit upon the note as of its date.”

We do not think it necessary to decide whose recollection as to what was said when the working agreement was made is most accurate. We attach great importance to what was actually done at that time and afterwards. These acts are entirely consistent with transactions that are within the law. Where the contract is not usurious upon its face, the party alleging it to be usurious has the burden of proof. We think he has not met that burden in this case. See Green v. Grant, 134 Mich. 462 (96 N. W. 583).

The other questions suggested by counsel have been examined, but do not call for discussion.

The decree should be affirmed, with costs.

Brooke, J., concurred with Moore, C. J.

Stone, J.

I am unable to concur in the opinion of Mr. Justice Moore in this case. While it is true, as he states, that this is not a proceeding to enforce the provisions of the so-called working agreement, yet it should be borne in mind that the mortgage here being foreclosed was executed to secure the payment of the money which had been advanced and became due under the terms of the said working agreement; and the letter of the secretary of the Edward Hines Lumber Company, of December 83, 1907, referred to by Justice Moore in speaking of the indebtedness of said Garth Company, had reference to indebtedness covered and contemplated by the working contract of November 14, 1906.

It is the claim of the defendant the Garth Lumber & Shingle Company that the evidence in this case discloses a transaction whereby the complainants were to receive not only 6 per cent, interest for all the money loaned by them to the appellant company, but also compelled the said appellant to pay $4,000 a year additional for the use of this money.

While the contract did not provide for the payment of this $4,000 directly to the complainants, it did provide for the payment thereof to men who held high offices in each of the complainant companies; and in each case it compelled the said defendant to pay money for services which were highly beneficial to the complainants, and which, it is fair to presume, would have been paid by them had the appellant been compelled to pay the amount agreed upon. This is especially true in the case of Mr. Wiehe, as will later appear.

In the case of Mr. Reynolds, the president of the bank, the contract provided for the payment of $8,000 for services which were never performed to a person who it would appear knew nothing about that part of the contract until some months after the agreement had been made.

We have carefully read this record relating as well to the contract of July 8, 1906, as to the later contract. Operations had been carried on under the first contract until the Hines Lumber Company had advanced the aggregate sum of $85,000. The said company refused to make further advances for reasons which it stated. In the meantime the Garth Lumber & Shingle Company had borrowed $20,000 from the complainant Continental National Bank of Chicago, of which Edward Hines was a director, and had incurred other indebtedness amounting to a large sum, as appears by this record.

Mr. Barker, representing the Garth Company, commenced negotiations with the Hines Company for the purpose of procuring additional advances. The situation was one in which the last-named company had a lien on all of the products which the Garth Company was to get out, and the property was so tied up that it was practically an impossibility for the Garth Company to borrow money from third parties. Negotiations were carried on during the month of October, 1906. Finally, about the 5th of November, 1906, a proposed contract was drawn up between the companies, which appears in this record. This proposed contract shows that the two companies were cooperating; and, while it called for further advances on the part of the Hines Company, it also provided for a mortgage, by the Garth Company, to wit, covering its real estate in the State of Michigan, and also other property. Mr. Barker, representing the Garth Company, and acting under the advice of counsel, declined to sign this contract in behalf of his company. Further negotiations resulted in a meeting in the office of Mr. Allen, the attorney for the Hines Company, at Chicago, on November 13 or 14, 1906. This meeting continued for more than one day, and there were present Mr. Wiehe, the secretary of the Hines Company, Mr. Allen, Mr. Baker, and Mr. Mead, also representing said company, and Mr. Barker, Judge Cahill, and Mr. Henry, representing the Garth Company., It is significant that, with one exception, every person who was present at that meeting, and who testified on the trial of this ease, says there was some talk about a bonus of some sort. Witnesses Wiehe, Baker, and Allen claim that the talk was concerning a bonus which was to be paid the Hines Company in case the Garth Company found somebody else to take the place of the former. It is very clear from this record that the Hines Company was facing a fact that the Garth Company already owed it a large sum of money, and it was about to enter into a contract which, in order to be made profitable, would not only require the reorganization of the Garth Company, but would call for other large advances to a concern which they all claimed was then in a desperate condition. It should not be forgotten that Mr. Barker testified that the Hines Company had already suggested a liberal discount of their claim if he would get somebody else to take its place, and it does not seem reasonable that the Hines Company was to be given a bonus to release its interest in such an unfavorable contract; Yet we are asked to believe that the only talk with reference to the bonus was with reference to a release of this contract, which finally is provided for in the contract without any provision for the payment of any extra sum.

Upon this subject Mr. Barker testified as follows:

"Q. I wish you would tell the court what took place in Mr. Allen’s office, in regard to that matter, at the time this contract was entered into which is dated November 14, 1906.
“A. My recollection is that the day before Mr. Henry had had a conference with Mr. Allen, perhaps one or two conferences, and were probably — I am not positive, but probably met at Mr. Allen’s office on the day before this contract was drawn up, and talked matters over without any result at all, and we were all to meet there on the following day when this working contract was finally drawn up; and there were present at that meeting Mr. Edward Hines, Mr. Wiehe, I think Mr. Hayes, the accountant of the company, Mr. Baker, Mr. Allen, Mr. Henry, Judge Cahill, and myself. And after we had all entered and sat down, Mr. Hines — and my remembrance is positive— stated that, before going on at all with any proceeding, he wanted it understood that he wanted a bonus of $6,000 before anything else was done. Judge Cahill got up and said that under the laws of Michigan he thought that would be declared usury, and they run the chance of not only losing the bonus, but the interest as well. There was nothing said for a minute or two, and finally, as I remember, Mr. Wiehe gets up, and Mr. Allen and Judge Cahill and myself, and we leave the room and go into the next room, which I suppose was their waiting room or library, and stands up there talking about usury. And then Mr. Allen and Mr. Cahill confer a minute or two and they say they will take $4,000 instead of $8,000, and will put it in the way of salaries to the directors, $2,000 to each of them. That is consented to on. my part, believing it the best to be done, and we go back then and they commence drawing up this contract, which was finally drawn up and a provision made for the resignation of these old directors, and the Illinois new ones in their place.
“Q. And this contract was all worked out after that time ?
“A. Yes, sir; that is my sworn statement of that meeting.
“Q. Why did you consent to that sort of an arrangement down there ?
Mr. Cleveland: That is objected to as calling for his conclusion, and as immaterial.
“A. As matter of compulsion. I had todo it or quit. These men were in the woods working, and there was only one thing to do.
Mr. By all: Q. Had you made some efforts to interest some other parties ?
“A. Mr.'Hines had made a statement once or twice that if I could get some one else to take his place in the contract — I asked the privilege, I thought I might be able to — he would give me $10,000; he would throw off $10,000 off his account if I succeeded in getting any one else to assume that contract and pay him back his money. And I saw one or two parties and found out I could do nothing with any of them upon any contract of that kind which Edward Hines had anything to do with. I couldn’t do anything with it, and I did nothing, accomplished nothing.
“Q. You made some efforts?
“A. I made some efforts; yes, sir.
“Q. Mr. Wiehe testified yesterday that there was some talk about fixing it in this way, that you were to pay a bonus if at some later day you found somebody to take it off their hands ?
“A. That is absolutely incorrect. Instead of that, it was the other way. I was to get a discount of $10,000 on my indebtedness to the Hines Lumber Company, provided I could get some one else to take that contract and pay them back their money. No such thing, not one word or syllable as Mr. Wiehe testified here.”

It is true that it is sought to weaken the testimony of Mr. Barker because he states that it was Mr. Hines who demanded the bonus at this meeting. He afterwards corrected this, and stated that it was Mr. Wiehe who made such demand. From the fact that there had been negotiations between Mr. Barker and Mr. Hines during the month of October, and a part of November, relating to this business, it is not strange that there may have been some confusion in Mr. Barker’s mind upon that subject. But Mr. Barker’s testimony does not stand uncorroborated upon this subject. Mr. Henry, who had been associated with Mr. Barker in business, and who also represented the Garth Company in the negotiations leading up to the meeting of November 14th, testified fully upon this subject:

“Q. You may state whether or not at this conference on the 13th anything was said by Mr. Wiehe or in the presence of Mr. Wiehe about the bonus to be paid to the Hines Lumber Company by the Garth Lumber & Shingle Company. (This was objected to by Mr. Cleveland as leading, suggestive, and as calling for the conclusion of a witness, and as incompetent, irrelevant, and immaterial.)
“A. There was. I cannot recall now who made the statement. My recollection is that a talk was had, possibly with Mr. Allen and Mr. Barker and Mr. Wiehe. They were on one side of the room, and they turned around, and some one stated, I don’t know who, that they wanted a bonus; that the Edward Hines Lumber Company wanted a bonus in the transaction as a part of this proposed arrangement for the control of that company. I would not say positively who made the statement, but I think it was — I think it came from, my recollection is that it came from — Mr. Barker; that is, he turned around in the conversation where it was held, but in the presence of Mr. Wiehe — that is my recollection, it is a long while ago — but he turned around and he stated that they wanted a bonus. Then there was some conversation in reference to the matter in the presence of Mr. Mead, Judge Cahill, Mr. Allen, Mr. Wiehe, and myself and these other two gentlemen.
“Q. What, if anything, was said by either of them? (That was objected to as incompetent, irrelevant, and immaterial as calling for the conclusion of a witness.)
“A. Judge Cahill stated that he thought that a matter of that kind would be in contravention of the laws of Michigan.
“Q. Did he say on what ground ? (This was objected to by Mr. Cleveland as incompetent, irrelevant, and immaterial. )
“A. I think he said that in his judgment it would be usury.
“Q. What further was done about it, if anything? (This was objected to by Mr. Cleveland as incompetent, irrelevant, and immaterial.)
“A. Mr. Barker, Judge Cahill, and Mr. Wiehe went out of the room. I do not know where. They went out and were gone a little while. I was not with them.
“Q. What happened when they came back, if anything ? (This was objected to as incompetent, irrelevant, and immaterial.)
“A. Somebody stated they had decided to put it in the form of salaries to the board of directors. I cannot state definitely who it was. It was one of the four that went out of the room, and all seemed to assent from what they said.
“Q, Do you know whether as the result of that talk and conversation this provision in the contract relative to the payment of salaries to the two directors of the company was inserted in the contract ? (This was objected to by Mr. Cleveland as a conclusion of a witness as incompetent, irrelevant, and immaterial.)
“A. It is my recollection that a draft of the contract had been prepared the night before. Judge Cahill came here, and I think it contained no clause of that kind. He examined the paper. Judge Cahill, Mr. Barker, and I went to lunch the day Judge Cahill was here and examined the paper, and my recollection is that when we went back in the afternoon, this suggestion regarding the matter came up. The conference was had in the other room by the four gentlemen, and when they came back, a new draft of the contract was made or it was prepared by Mr. Allen, and Judge Cahill went home, and the contract was signed between us the following day. I think Judge Cahill left an assignment of his stock and tendered his resignation as a member of the board, and that afternoon Mr. Wiehe was elected a member of the board in place of Judge Cahill. * * *
“Q. Mr. Henry, at the time of this talk about this bonus which you refer to, was any particular amount mentioned ?
“A. I could not say as to that. I have an impression, but I have no distinct recollection as to the amount ?
“Q. What is your impression ?
“A. My impression is that it was $4,000.
Mr. Cleveland: I object to the question. It is incompetent and immaterial.
The Witness: I will say that the conversation was not directed to me; it was a conversation that I heard.
“ Mr. By all: You mean the $4,000 ?
“A. Yes, sir.”

The testimony of Mr. Barker and Mr. Henry is substantiated in all of its important details by that of Judge Cahill, who was called to Chicago to assist Mr. Henry in the preparation of this contract, and as attorney for the Garth Company. He testified as follows:

“Q. Now at that time you may state whether there was any talk relative to a bonus being given by anybody to the Garth — I mean by the Garth Lumber & Shingle Company to anybody.
Mr. Mead: I object to that as immaterial and incompetent.
“A. Some one, whom I understood to be representing the Hines Lumber Company, said that there wouldn’t be any new arrangement or any more money advanced unless there was some provision, some bonus arranged for, over and above the interest that they had been getting; and I at once said that any exaction of a bonus would be usurious, in my judgment; and then some one, I am not sure who it was, but it seems to me it was Mr. Allen, spoke up and said, ‘ Well, that has been taken care of by agreeing to pay the directors a salary.’ And the bonus, the amount that was first talked about, was $6,000. Mr. Barker said he wouldn’t pay $6,000; that it was extortionate, and he wouldn’t pay it. Then it was suggested — my recollection is that Mr. Allen and myself and Mr. Henry retired and considered what sum he would be willing to give, or what sum he ought to give, what sum should be given. I know certainly that I was one of them that retired, and I am quite sure that Mr. Allen was another; just who the third one was I ain not certain. And after talking the matter over we agreed upon $4,000. I said I would consent to that if Mr. Barker would approve of it, but I must first submit it to him. I think- Mr. Allen said similarly he wanted to submit it to Mr. Wiehe, or whoever else was there; he wanted to submit it to his people. So I submitted it to Mr. Barker, and he finally consented to it.
“Q. This contract of November 14th was signed up at that time ?
“A. I can’t be sure about that. I wasn’t concerned with that. I was called over there, not to look after the details of this contract, but simply to consult with Mr. Barker as to whether he had better make any contract at all or not.
"Q. You may state whether or not the amount which was inserted by way of salary was the amount agreed upon by way of bonus.
“A. That is the way I understood it. It was suggested in the manner I have stated; anybody else can draw as good an inference about it as I can.”

Upon cross-examination Judge Cahill testified:

“Q. At that time don’t you recall, Judge Cahill, that Mr. Barker thought that perhaps in the near future he might be able to terminate that contract to his advantage ?
‘‘A. Yes, I think something of that kind was said.
“Q. And at that time is it or not true that Mr. Wiehe said that if he had a right to terminate the contract, and should terminate the contract, then the Edward Hines Lumber Company ought to have a bonus ?
“A. I don’t think so. I think I said he would give them a certain length of time — 20 or 30 days or less, some length of time, anyway. If, within that time, he would pay what was coming to them, they would be glad to have him do it.
“Q. Are you willing to say that Mr. Wiehe didn’t say, or that some one didn’t say, in case Mr. Barker would terminate the contract by which the Edward Hines Lumber Company was to have the product, then that they ought to have a bonus ?
“A. No, sir; I think there is a clause, now that you o»11 my attention to it — I think there is a clause in the mortgage which says, if the money was paid in a certain time, they might or they would surrender the contract.
“Q. Yes, that is true. But don’t you remember that the question of money came up; that if, after making the arrangement, and making the advances, the contract should be terminated, and they would not get the lumber, then they ought to have some compensation for drawing it up ?
“A. I didn’t hear that, I am sure. That is not what made me think it was usurious, because that wouldn’t be usury at all.
“ Q. You don’t know what transactions these gentlemen had had before; you had not been at their negotiations before ?
“A. No.
“Q. Were you there more than this one day ?
“A. That is all, just that one occasion.
“Q. At this time the idea of paying a bonus was never carried out; that is, it never was put in the contract ?
“A. The idea of who paying a bonus ?
Q. Anybody paying a bonus ?
“A. That depends on how you look at it. If you want my opinion on it — you do not want my opinion, I suppose ?
“Q. No. You understood, did you not, at the time, that the creditors claimed at least that Mr. Barker had not properly managed the company. They made that claim, didn’t they ?
“A. You mean from the time he had been running his—
“Q. Yes, that he hadn’t made a success of running the company.
“A. I don’t know that I knew whether he was running the company or whether they had been running it.”

Mr. Mead himself testified that it was his recollection that at the time of this talk no provision had been yet made in regard to salaries. It is true that it is claimed by the complainants that the introduction of this salary question may be explained upon the theory that Mr. Barker had asked for a salary, and thereafter the other directors demanded it. But it seems more reasonable to say that the testimony on behalf of the defendants gives the correct version, when the witnesses testify that a bonus of $6,000 had been demanded, which sum was afterwards reduced to $4,000, and that then Mr. Allen announced that it had been taken care of in the shape of salaries.

We are constrained to say that, in our opinion, the clear weight of evidence shows that a bonus to be paid to the Hines Company as a consideration for its continuing to finance the Garth Company was demanded, and that the financial condition and other circumstances surrounding the parties at that time were such that the Garth Company was in a position where it might easily have been made the subject of such a demand, and that the question of this amounting to usury was discussed at this meeting, and that it was practically admitted by the attorneys present that the payment of a bonus in that form would amount to usury, and that the same purpose was attempted to be accomplished by providing for paying the amount in the form of salaries. An examination of the working contract on its face appears to be an agreement between Mr. Barker, one of the defendants, John A. Henry, and C. F. Wiehe, owners of the entire capital stock of the Garth Company, as parties of the first part (therein called “stockholders”); certain creditors of said company, as parties of the second part (the two complainants, Continental National Bank of Chicago, and Hines Lumber Company, called “creditors”); the Garth Lumber Company, as party of the third part; and Barker, individually, as party of the fourth part. It first provided for the stockholders to turn over all of their stock to Charles Allen, to be held by him in trust in accordance with a certain trust agreement, which appears in the record, and provided, in short, for Allen to vote the stock at all meetings in favor of Barker, Wiehe, and Reynolds, as directors of the Garth Company, It was further provided that the object of the trust agreement was to give the creditors a majority on the board of directors; and it specifically provided that “ C. F. Wiehe and George Reynolds, above named, represent said creditors, and Cyrus A. Barker represents said company.” The board of directors was given full, absolute, and uncontrolled right to conduct the business of the company as long as the agreement was enforced. It then provided that Mr. Barker should receive $250 per month, and that he was to give his entire time and attention to the conduct of the business of the company. It then provided that each of the other directors, viz., C. F. Wiehe and G. M. Reynolds, should receive a salary at the rate of $2,000 per year, payable monthly.

We have referred to the provision that the Hines Company gave the Garth Company and Barker each a right to pay within 15 days from the date of the instrument all advances which might have been made under the agreement of July 2, 1906, and upon making such payments, with interest at 6 per cent, per annum from the date of each advance, then the agreement of July 2, 1906, should be canceled and terminated, and that the Garth Company and Barker should each be under no liability or obligation whatever to the Hines Company by reason of said contract. In this connection no reference is made to any bonus. Had a reasonable amount been inserted for such privilege, it probably would not have been usurious.

Pursuant to the provisions of this contract, the stock was all transferred to Mr. Allen, and he proceeded to cast it for the election of Messrs. Barker, Reynolds, and Wiehe as directors of the company. At this time Mr. Reynolds was the president of the Continental National Bank, complainant, and testified as follows:

“ I am told that I was at one time a director of the Garth Lumber & Shingle Company. I do not think I was ever present at any meeting where I was elected a director of that company. I think, as I recall it, I attended one meeting of the directors of the Garth Lumber & Shingle Company. I think I received compensation as a director. My recollection is that I received at one time $150. I am speaking from memory. The bank did not get any of that. No part of it was ever paid to the bank. I was told some months afterwards of the resolution or agreement to the effect that I was to have $2,000 a year for acting as a director.”

He then refers to a certain letter received by him from an attorney in Michigan in which it was claimed that his bank had been receiving usurious interest; that he wrote denying this charge; that he then had the bank’s attorney take up the question with Mr. Wiehe, who informed him that a resolution had been passed to the effect that the directors of that company were to have $2,000 a year; and that checks had been issued from time to time running to him (Reynolds) as director, but that he had never received them at all. He then adds:

“ In fact, I told Mr. Wiehe at that time, that I had not performed any services and did not think I was entitled to them, and that I would not want to take them. I do not remember. He told me the amonnt, but I cannot undertake to tell what it was; it was some months afterwards at any rate. I did not receive personally anything on account of this salary of $2,000 a year outside of the $150.”

He then stated that the said bank did not receive it, and that it has never received anything on the note in the way of usury, nor anything in excess of 6 per cent., provided for in the note; that he was a director of the Continental National Bank and president at the time the loan was made. And he stated, on cross-examination, that he could not tell what business was transacted at the meeting of the Garth Company which he attended.

It appears from the record that one check for $1,833.33 had been drawn in Mr Reynolds’ favor and certified by his bank, and had never been delivered to him. This check bears date November 25,1907. This is the same check which is mentioned in the decree, and which was credited to the defendants, although charged against them by the complainants in their bill of complaint, and in the account which they produced on the hearing of the case.

It is the claim of the defendants that the foregoing facts bring the case within the doctrine of Anderson v. Smith, 108 Mich. 69 (65 N. W. 615).

The condition under which the money was paid to Wiehe is somewhat different. He was secretary of the Edward Hines Lumber Company, and, by authority of the working agreement, became secretary and treasurer of the Garth Company. He continued to work for the Hines Company, and his salary as secretary of that company continued and was not decreased. The Hines Company, in this record, claims to be the largest lumber company in the world, and his services as secretary of that company were very extensive and onerous. It would seem from his testimony that the services which Mr. Wiehe claims to have performed in connection with said $2,000 salary were in the interest of, and increased, the security of the complainants’ advances, and that the great mass of supervisory work consisted in looking after the transactions between the Garth Company and the Hines Company.

Bearing in mind that both Mr. Wiehe and Mr. Reynolds were interested as officers with the complainant companies, both of which were creditors, and that they were placed upon the board of directors of the Garth Company to represent the creditors, does it meet the question presented by the defendants to say that neither of the complainants obtained any direct benefit from the payment of these salaries ? Without conceding that such was the fact, is not the more important question to be considered whether the Garth Company was not compelled to pay more than the legal rate of interest on its indebtedness in order to consummate said working contract, to secure the payment and performance of which this mortgage was executed ?

We think that the claim of the defendants upon this question is well within the authorities. We shall not stop to analyze them, but refer to them generally hereafter. The language of our statute is important in this connection. Section 4857, 2 Comp. Laws, is as follows:

“ No bond, bill, note, contract or assurance, made or given for or upon a consideration or contract, whereby or whereon a greater rate of interest has been, directly or indirectly; reserved, taken or received, than is allowed by law, shall be thereby rendered void; but in any action brought by any person on such usurious contract or assurance, except as is provided in the following section, if it shall appear that a greater rate of interest has been, directly or indirectly, reserved, taken or received, than is allowed by law, the defendant shall not be compelled to pay any interest thereon.
■“ Sec. 4858. Whenever it shall satisfactorily appear by the admission of the defendant, or by proof that any bond, bill, note, assurance, pledge, conveyance, contract, security, or any evidence of debt has been taken or received in violation of this act, the court shall declare the interest thereon to be void.”

It is well that we bear in mind that by this statute usury consists in the reservation of a greater rate of interest, directly or indirectly, than is provided by law, as well as in the taking or receiving; and it is not necessary that unlawful interest be actually paid or received in order to constitute usury.

It is also the rule in this State that, if the transactions on account of which the indebtedness was incurred were tainted with usury, its effect cannot be avoided by taking other paper or security for the indebtedness, including the usurious charge. Smith v. Stoddard, 10 Mich. 148 (81 Am. Dec. 778); Gardner v. Matteson, 38 Mich. 200. See note to Rorer v. Building & Loan Ass’n, 2 Am. & Eng. Ann. Cas. 912.

Much depends upon the intention of the lender in such a case. Fretz v. Murray, 118 Mich. 302 (76 N. W. 495); Estey v. Building & Loan Ass’n, 131 Mich. 502 (91 N. W. 753); Green v. Grant, 134 Mich. 462 (96 N. W. 583); George N. Fletcher & Sons v. Alpena Circuit Judge, 136 Mich. 511 (99 N. W. 748).

It is also claimed by complainants that to be usurious the payment must be exacted by the lender for the use of money, and not on account of some other consideration.

In Rosen v. Rosen, 159 Mich., at page 75 (123 N. W. 560, 134 Am. St. Rep. 712), Justice McAlvay, in speaking for the court, said:

“The authorities in those States where the statutes like ours include all contracts and assurances are harmonious in holding that every written agreement to pay interest in excess of the legal rate, however well the unlawful interest may be disguised, is in violation of law and usurious ” —citing cases.

See, also, Houghteliny v. Lumber Co., 165 Mich. 498 (131 N. W. 109); France v. Munro, 138 Iowa, 1 (115 N. W. 577, 19 L. R. A. [N. S.] 391); Barry v. Paranto, 97 Minn. 265 (106 N. W. 911, 7 Am. & Eng. Ann. Cas. 984, and note).

No disguise of language can avail for covering up usury, or glossing over a usurious contract. While the courts hold that a fair and reasonable charge may be made by the lender for services actually rendered, nevertheless they have said:

“But because charges of this character are often resorted to as a plausible pretext for obtaining illegal interest, and are easily made at a time when the borrower is at a disadvantage, a very strict degree of proof is required of their reasonableness, and of the bona fides of the lender, when challenged as usurious.”' 27 Am. & Eng. Enc. Law (1st Ed.), p. 1013.

See, also, Pope v. Marshall, 78 Ga. 635 (4 S. E. 116); Payne v. Newcomb, 100 Ill. 611 (39 Am. Rep. 69); Ammondson v. Myan, 111 Ill. 506; 29 Am. & Eng. Enc. Law (2d Ed.), pp. 461-463, and cases there cited.

We conclude that the decree should be modified in accordance with the views here expressed, and the case should be remanded with directions to the lower court to take an accounting and ascertain the amount of interest which has been paid by or charged to the Garth Company by complainants since the making of the contract of November 14, 1906, which interest should be deducted from the amount of the decree against it, in the lower court.

The appealing defendants should recover their costs in this court.

Steere, McAlvay, Blair, and Ostrander, JJ., concurred with Stone, J. Bird, J., did not sit.


author: Hooker, J. Moore, C. J.

text:
    LOUNSBURY v. TRUSTEES OF SQUARE LAKE BURIAL ASSOCIATION.
    1. Perpetuities — Wills—Trusts—Personal Property.
    A bequest to trustees of a voluntary cemetery association, of a perpetual fund, tbe interest to be used to care for tbe graves on testator’s lot, is void, as an attempt to create a trust in perpetuity.
    2. Same — Real Property — Devises—Cemetery.
    A will devising a portion of testator’s estate to trustees of a cemetery, to be used in building a fence around the cemetery, and in building a vault therein, containing no restriction on the alienation of the property, is valid; since the law will not infer a restriction contrary to law, if the inference is not necessary
    3. Same — Voluntary Associations — Cemetery—1Trusts.
    A voluntary association may receive a bequest of personalty not charged with a permanent use.
    4. Same — Charitable Uses.
    A conveyance by will of property to be used to build a fence and vault in a cemetery, to certain persons named in the testament as trustees, who, in fact, constitute a voluntary cemetery association, is not void; and they may, if real estate is included, convert it from real property into money, and apply the proceeds to the purposes specified by the will.
    Appeal from Oakland; Chester, J., presiding.
    Submitted October 25, 1910.
    (Docket No. 107.)
    Decided December 30, 1910.
    Rehearing granted March 30, 1912.
    Reargued April 23, 1912.
    Former opinion affirmed October 1, 1912.
    Bill by Robert J. Lounsbury, administrator de bonis non, with will annexed, of the estate of Noah Tyler, deceased, against trustees of Square Lake Burial Association, Luther W. Fisher, executor of the estate of Mary Tyler, deceased, Carrie Fletcher, Charles Miller, William Miller, Noah Brown, and Albert Fletcher, special administrator of the estate of Joseph Miller, deceased, to obtain a construction of the will. From a decree sustaining the will, defendants appeal.
    Modified and affirmed^

      Patterson & Patterson, for complainant.

      McFarlan & Wilson, for defendants.
   Hooker, J.

Among other provisions of Noah Tyler’s will are the following:

“Fifth: I give and bequeath the sum of One Hundred Dollars to the Trustees of the Square Lake Cemetery in the Town of Orion, Oakland County and State of Michigan, as a perpetual fund to be kept at interest by said Trustees and the interest used to take care of the graves on my lot in said cemetery and keep the said lot in order.
Seventh: I give, devise and bequeath to my beloved wife, Mary Tyler, all my household goods and furniture and all my personal and real estate of every kind after the payment of the foregoing legacies to be used by her for her support, maintenance and comfort during her natural life or so long as she remains unmarried.
“And after the death or marriage of my beloved wife, Mary Tyler, I give and devise all the rest and residue and remainder of my estate to the Trustees of the Square Lake Cemetery to be used to build a good and substantial iron fence around the said Square Lake Cemetery and whatever is left after erecting said iron fence around the same, is to be used by said trustees to build a vault in said cemetery for the use thereof to be controlled by the Trustees of said cemetery.”

Mary Tyler is dead.

Some of the heirs having questioned the validity of these provisions, the bill was filed by the administrator de bonis non, with the will annexed, to obtain a consideration of that question and a construction of the will.

The complainant claims that the fifth and seventh paragraphs of the will are in effect attempts to bequeath money in trust, and that the provisions are void, because in violation of the law against perpetuities. It is said that section 5 requires the sum of $100 to be kept invested perpetually with a view to furnishing an annual sum, to be expended in keeping the cemetery lot and grave of testator in good condition, and that section 7 requires the investment of the residue of his estate in an iron fence and vault for said cemetery, to be controlled by its trustees. We marvel that an heir will contest such provision, but he has a right to do so.

That paragraph 5 is open to this construction, seems obvious. It is apparent from the fifth section that the testator gave the sum of $100, as a trust fund, in perpetuity, for it is so stated in unmistakable language. There is but one course for the trustees and their successors to take, viz., to keep the fund invested, and use the interest in the manner required by the will for all time. It was therefore void. See Palms v. Palms, 68 Mich. 379 (36 N. W. 419).

The seventh paragraph is a devise to certain trustees of the cemetery for definite purposes, viz., first, to build a fence around the cemetery; second, to use any remainder to build a vault in the cemetery “for the use thereof, to be controlled by the trustees thereof.” It is not so clear that the seventh provision is void, as contrary to the laws against perpetuities. The testator bequeaths the residuum to trustees, to be expended in a certain way, viz., the construction of a fence upon a certain piece of land belonging to a corporation or voluntary association. It contains no restriction as to its use or disposition after its construction. It was apparently for the benefit of the cemetery, and upon its erection would be subject to such disposition as the cemetery association should see fit to make. The law will not infer a restriction contrary to law, if it is not a necessary inference.

The provision relating to the vault is similar. In the first place, there may be nothing left after paying for the fence. If there should be, there is nothing restrictive of alienation in the provision, unless it be the statement that it is “for the use of the cemetery, to be controlled by the trustees of the cemetery.” Had he added the words, '"so long as they shall choose to keep the same,” it would clearly show that no restraint of alienation was intended; but that was unnecessary. He directed the construction for the use and benefit of the cemetery. He could not and did not attempt in any way to restrain the trustees or the cemetery association, through its trustees, from making any disposition of the property, including the vault, that might be lawful. Hence there was no unlawful restraint of alienation required by the will.

Counsel contend that this association, being a voluntary one at the time the will was probated (though it has since been incorporated), could not be made a trustee, and that the provision is therefore void. We need not pass upon that question. If it be true that it was a voluntary association, it had the right to permit trustees of the testator’s selection to expend money on its property. For his trustees, he selected the persons who should be trustees of the cemetery at the time his bequest should become effective, and their successors, and this was as plain a designation as any other. We say this upon the theory that a proper construction of the paragraph means this. But again counsel claim that the cemetery association, being merely a voluntary association, has not the capacity to receive and hold land, and therefor does not own the cemetery, and that it could not receive gifts of the fence and vault, that the only theory on which such a provision can be sustained is that it is a charitable use, which is an obsolete doctrine, if it ever existed in Michigan.

It is said that we held in White v. Rice, 112 Mich. 403 (70 N. W. 1024), the late Mr. Justice Long writing the opinion, that:

"The claim that is made, that the beneficiary in a trust for religious purposes must be a corporation organized under the laws of this State, has no force. Section 4640, 1 How. Stat., refers to the legal title or interest in the grantee or trustee, and not to the beneficiary in the trust as, under section 4637, the lands conveyed to any person as trustee may be held in trust for the use of any congregation or religious society organized within this State.”

While this case was based on a statute, and therefore cannot be controlling in this case, the case of the Estate of Ticknor, 13 Mich. 44, makes it clear that a voluntary association has the capacity to take bequests of personalty, not charged with a permanent use. A learned opinion was written by the late Mr. Justice Campbell, which has never been questioned in this State, and many authorities are in accord with it. See Owens v. Missionary Society, 14 N. Y. 380 (67 Am. Dec. 160, and note, 185); Hadden v. Dandy, 51 N. J. Eq. 154 (26 Atl. 464, 32 L. R. A. 627, and note); White v. Rice, 112 Mich. 409 (70 N. W. 1026), where we said:

“An unincorporated society or a voluntary association, like a religious society or denomination, is capable of taking as a beneficiary in a trust. Universalist Society v. Fitch, 8 Gray [Mass.], 421; Smith v. Bonhoof, 2 Mich. 115. See, also, Tomlin v. Blunt, 31 Ill. App. 234.”

In the view we take of this case, the bequest can be sustained on another theory. It has been seen that'this property has not been bequeathed directly to the society, but has been to trustees, who are competent to take and hold the property. Such a bequest is valid, and it may be that the same would be true of a devise. Goesele v. Bimeler, 5 McLean (U. S.), 223, Fed. Cas. No. 5,503; Barnum v. Mayor, etc., of Baltimore, 62 Md. 297 (50 Am. Rep. 219); Trustees, etc. v. Shively, 67 Md. 493 (10 Atl. 244, 1 Am. St. Rep. 412); Halsey v. Protestant Episcopal Church, 75 Md. 275 (23 Atl. 781); Bartlet v. King, 12 Mass. 537 (7 Am. Dec. 99); Jackson v. Phillips, 14 Allen (Mass.), 539; Wellbeloved v. Jones, 1 Sim. & S. 40, 1 L. J. Ch. 11; Schmidt v. Hess, 60 Mo. 595.

In Conklin v. Davis, 63 Conn. 377 (28 Atl. 537), it was held that a bequest to trustees for the benefit of a Sunday school (unincorporated) was valid. It is not improbable that some of these cases are made to turn upon the doctrine of charitable uses, but all do not, and Mr. Justice Campbell has so shown in the case of Estate of Ticknor, supra. Beatty v. Kurtz, 2 Pet. (U. S.) 566.

It is claimed that the seventh paragraph of the will was an attempt to devise lands, but we see no reason why the trustees might not take a devise, and by converting it into money, as the testator evidently contemplated, obtain means wherewith to build the fence and vault, which testator had the right to have done for the benefit of those constituting the cemetery association, of which he was a member at the time, of his death.

A decree may be taken in conformity to this opinion. Neither party will recover costs.

Bird, C. J., and Ostrander, Moore, and Stone, JJ., concurred.

ON REHEARING.

Moore, C. J.

This case was argued and submitted some time ago. The late Justice Hooker wrote an opinion, which was signed by all the Justices who sat in the original hearing. Later a reargument of the case was granted before all the Justices, and the reargument has been had. I was satisfied with the opinion of Justice Hooker when it was handed down, and I am still satisfied with it. For that reason I deem it unnecessary to say more than to refer to that opinion. It is reported ante, 645 (129 N. W. 36).

Steere, MoAlvay, Brooke, Stone, Ostrander, and Bird, JJ., concurred. Blair, J., did not sit.


author: Ostrander, J. McAlvay, J.

text:
      In re CRANE.
    Contempts — Divorce — Marriage — Statutes—Decree Forbidding Remarriage.
    For marrying again in a foreign jurisdiction within a month after a decree of divorce was entered forbidding the defendant husband from remarrying within two years, under 3 Comp. Laws, § 8658, said defendant was not punishable as for contempt of court; since his remarriage outside the State did not violate the statute. McAlvav and Brooke, JJ., dissenting.
    Habeas corpus by Elvin W. Crane.
    Submitted May 24, 1912.
    (Calendar No. 25,186.)
    Writ granted June 12, 1912.

      William V. Smith, for petitioner.

      Guy W. Selby and Daniel Heins, for respondent.
    3 Comp. Laws, § 8658, reads as follows:
    “ The court granting a decree of divorce may provide in such decree that the party against whom any divorce is granted shall not marry again within such time as shall be fixed by the court, which time shall be set out in the decree: Provided, that such time shall not exceed the period of two years from the time such decree is granted. And in case any person shall marry contrary to the time set out in such decree said party shall be deemed to have committed the crime of bigamy and shall be subject to the pains and penalties therefor.”
    In the circuit court, in chancery, for the county of Genesee, Mich., January 29, 1912, one Allie Crane was granted a decree of divorce from petitioner; the decree specifying that the defendant (petitioner here) should not remarry for a period of two years from and after the date of said decree. Less than one month thereafter petitioner was a party to a marriage ceremony performed at Windsor, Ontario, February 22,1912, according to which ceremony he was married to one Anna Henniger by a clergyman licensed to celebrate marriages. Petitioner and said Anna Henniger returned to Flint, Mich., the former and present domicile of petitioner, where they have since lived as man and wife. Certain friends of the said court presented therein a petition advising the court that its decree had been thus disregarded and praying that petitioner be proceeded against as for a contempt.
    Such proceedings were thereafter had that the court found and determined that the said acts and doings of petitioner were calculated to and did impair the respect due to the authority of the court, and tended to prejudice the court in the enforcement of its orders and decrees and to interfere with its rights and lessen its dignity, and that petitioner was guilty of contempt. He was sentenced and committed to the common jail of the county for a period of 30 days. Petitioner applied to the court for the writ of habeas corpus, which was allowed. The sheriff of the county of Genesee returns that he holds petitioner by virtue of an order of the said court, a copy of which is given.
    The facts are not in dispute. The validity of the decree of divorce is not denied. The contention of petitioner is that, because the act of remarrying took place in a foreign jurisdiction, no contempt can be predicated thereon. The argument which is made is in substance that the statute provides an exclusive penalty for such a remarriage which can have no extraterritorial effect; that the Canadian marriage is valid in Canada and therefore is valid everywhere; that consequently petitioner is not guilty of bigamy, nor, in contracting a valid marriage, is he guilty of contempt. It is a further contention that the statute (1 Comp. Laws, § 1098), in which is recognized (if not conferred) the power of a court to punish as for a criminal contempt “ wilful disobedience of any process or order lawfully issued or made by it,” does not include disobedience of a final decree of the court. On the other hand, it is contended, not that the Canadian marriage is void, but that whether it is or is not a valid marriage the power of the court imposing the restriction upon petitioner to punish the wilful disobedience of its decree is clear and is a power inherent in the court.
   Ostrander, J.

(after stating the facts). It is apparent that the power of the court to impose the restriction upon petitioner is derived from, and is in execution of, the statute. The force and effect of the statute cannot be extended by the decree. Therefore, if for any reason the action of petitioner was not in violation of the statute, neither was it in disregard of the decree. I conceive that the case would be different if the court had the power, independent of statute, to impose the restriction. Courts of equity not infrequently make decrees controlling the conduct of parties in any jurisdiction into which they may go. In the instant case the decree is effective as the statute is effective and not otherwise. I am of the opinion, therefore, that the conviction of petitioner cannot be sustained if his marriage is considered to be valid.

It is impossible, I think, to consider the disregard of the decree separate from the disobedience of the statute. Petitioner has not disregarded the decree if he has not also disobeyed the statute. The court by virtue of the statute commanded the petitioner not to remarry. The consequences of a remarriage are stated in the statute and are:

“ In case any person shall marry contrary to the time set out in such decree said party shall be deemed to have committed the crime of bigamy and shall be subject to the pains and penalties therefor.”

I conclude that, whether the Canadian marriage was valid or was invalid, the court had no jurisdiction to punish petitioner as for a criminal contempt. An order will be entered discharging petitioner from custody.

While I have found it unnecessary to determine the scope of the statute, it is not improper to direct attention to the fact that it seems to be penal in character; a fact which must be considered in any case in determining its effect. Statutes imposing restrictions upon the remarriage of divorced persons are not uncommon and in some jurisdictions are operative without the aid of an express restriction in the decree of divorce. Manifestly, if a statute is so drawn that prohibitions must be considered as applying only to marriages solemnized within the State, divorced persons may with impunity remarry in a foreign jurisdiction and return to and live in the State. On the other hand, if a statute is so drawn as to clearly disclose a State policy which regards as void all marriages in disregard of the statute restriction, wherever the marriages are celebrated, the courts must determine the rights of parties accordingly.

It was held in New York in Van Voorhis v. Brintnall, 86 N. Y. 18 (40 Am. Rep. 505), approved in Thorp v. Thorp, 90 N. Y. 602 (43 Am. Rep. 189), that a provision of the Revised Statutes prohibiting the second marriage of a person divorced on the ground of his or her adultery during the life of the former husband or wife, and declaring such marriage void, had no application, as they are in the nature of a penalty, and have no effect outside of the State in the absence of the express terms of the statute showing legislative intent to give them that effect. And in the case last referred to, in which a divorced person who was within the terms of the statute had remarried in another State and was applying for a divorce from the person he had so married, it was held that the fact that in remarrying he had disregarded the terms of the former decree of divorce was not ground for refusing him relief. The answer to the contention that he was in contempt was that neither the decree nor the statute which authorized it had any effect outside the jurisdiction of the State.

In Wisconsin the statute considered was:

“It shall not be lawful for any person divorced from the bonds of matrimony by any court of this State to marry again within one year from the date of the entry of such judgment or decree and the marriage of any divorced person solemnized within one year from the date of the entry of any such judgment or decree of divorce shall be null and void.” Laws 1901, chap. 271, amended by Laws 1905, chap. 456.

In Lanham v. Lanham, 136 Wis. 360 (117 N. W. 787, 17 L. R. A. [N. S.] 804, 128 Am. St. Rep. 1085), the court considered the application of a widow to have support out of the estate of her alleged deceased husband. It appeared that she had been divorced in Wisconsin from a former husband and had within a month remarried in Michigan with the purpose of evading the Wisconsin law. It was held that the Michigan marriage was void, and in reaching this conclusion the court declared the statute was not a penal law and that the law was a declaration of the policy of the State to regard such marriages, wherever celebrated, as invalid in Wisconsin. Other cases to which reference may be made are Pennegar v. State, 87 Tenn. 244 (10 S. W. 305, 2 L. R. A. 703, 10 Am. St. Rep. 648); McLennan v. McLennan, 31 Or. 480 (50 Pac. 802, 38 L. R. A. 863, 65 Am. St. Rep. 835); Estate of Stull, 183 Pa. 625 (39 Atl. 16, 39 L. R. A. 539, 63 Am. St. Rep. 776); Smith v. Fife, 4 Wash. 702 (30 Pac. 1059, 17 L. R. A. 573); State v. Shattuck, 69 Vt. 403 (38 Atl. 81, 40 L. R. A. 428, 60 Am. St. Rep. 936). Also, see 14 Cyc. p. 729; 26 Cyc. p. 829.

Steere and Bird, JJ., concurred with Ostrander, J.

McAlvay, J.

(dissenting), I cannot concur in the opinion of Mr. Justice Ostrander, which discharges petitioner from custody for a contempt of court committed purposely and probably under advice. In my opinion the decree prohibited absolutely the marriage of petitioner within a period of two years. The statute was intended by the legislature .declaratory of the policy of the State prohibiting the marriage of a divorced party anywhere. The statute in declaring a party who marries contrary to its provisions guilty of bigamy does not necessarily require a construction that such act will deprive the court of the inherent power to punish as for contempt a disobedience of its decree.

No authorities are cited that go to this extent. The legislature could not have intended such a result, and no rule of construction should obtain which necessarily deprives the courts of powers which have always been recognized.

In my opinion, this statute should receive that same construction given by the supreme court of. Wisconsin to a statute of like import.

The writ should be denied.

Brooke, J., concurred in result reached by McAlvay, J.


author: Stone, J.

text:
    VERNIER v. COMMON COUNCIL OF VILLAGE OF GROSSE POINTE SHORES.
    1. Villages — Intoxicating Liquors — Constitutional Law — Common Counoil — Charter.
    Under the provisions of Art. viii, §§ 20, 21 of the Constitution, and of Act No. 278, Pub. Acts 1909, the electors of a village may delegate to the common council thereof authority to suppress saloons, by so providing in the charter, and by making appropriate reference to section 2769, 1 Comp. Laws: the authority conferred by section 24 of the statute is not limited to the electors, who may, by charter, empower the village council to act.

      2. Same — Charter of Village of Grosse Pointe Shores — Ordinance.
    An ordinance passed by the common council of the village of Grosse Pointe Shores, suppressing saloons, under a village charter authorizing the suppression of the sale of intoxicating liquors, is valid.
    Certiorari to Wayne, Hally, J.
    Submitted June 4, 1912.
    (Calendar No. 25,200.)
    Decided July 10, 1912.
    Mandamus by Edmund C. Vernier against the common council of the village of Grosse Pointe Shores, to compel respondents to grant relator’s application for a license to engage in the retailing of intoxicating liquors. An order granting the writ is reviewed by respondents on certiorari.
    Reversed.

      William iff. Mertz and Frank N. Eenaud (Charles D. Joslyn, of counsel), for appellant.

      Edwin Henderson, for appellee.
   Stone, J.

This is certiorari brought by the common council of Grosse Pointe Shores to review the action of the circuit court of Wayne county in granting a mandamus in favor of relator against said village council. The sole question involved is the validity of an ordinance adopted by the village council on April 12, 1912, suppressing all saloons in said village. On the same date the relator below made application for a license to carry on the sale of spirituous and intoxicating liquors in said village. On April 29th the council rejected said application. Whereupon the relater applied to the circuit court for the county of Wayne for a writ of mandamus to compel the respondent to grant the relator a license. After due hearing in the premises, the writ was granted.

The said village was organized under Act No. 278 of the Public Acts of 1909. In pursuance of that act, it adopted a charter, which contained the following provision : Chapter 26, § 2:

“ The common council shall have power to pass such ordinances in relation to the following subjects as it may deem proper: (1) To regulate trade, occupations and amusements within its boundaries, including the sale of intoxicating liquors and the number of licenses to be issued therefor; and to suppress saloons for the sale of spirituous and intoxicating liquors.”

The validity of this ordinance is attacked upon the ground that its enactment involved the exercise of the police power of the State; that the legislature has delegated this power to the electors of the village; that the electors of the village could not redelegate the power to the village council; that consequently the charter provision delegating the right to suppress saloons to the village council is void, and, as a necessary séquence, that the ordinance is void. Article 5, § 1, of the Constitution of Michigan, provides :

“ Legislative power is vested in a senate and house of representatives. ”

Article 8, § 20, of the Constitution, provides:

“ The legislature shall provide by a general law for the incorporation of cities, and by a general law for the incorporation of villages. * * * ”

Section 21 of the same article is as follows:

“ Under such general laws, the electors of each city and village shall have power and authority to frame, adopt and amend its charter, and, through its regularly constituted authority, to pass all laws and ordinances relating to its municipal concerns, subject to the Constitution and general laws of this State.”

In 1909, by Act No. 278, the legislature enacted the following provision:

“Sec. 24. Each village may in its charter provide: (a) for the regulation of trade, occupations and amusements within its boundaries, including the sale of intoxicating liquors and the number of licenses to be issued therefor, but no charter shall permit the sale of such liquors in any county where such sale is prohibited by operation of the general local-option law of the State, but may suppress saloons for the sale of spirituous and intoxicating liquors.”

Section 25 of said act is as follows:

“Each village may adopt as its charter or any part of the same, any chapter, act or section of the statutes of this State in force at the time of such adoption and not inconsistent with the provisions of this act, which relates to the powers or government of villages generally, either by reciting the same in such charter or by appropriate reference thereto.”

The court below held (a) that Act No. 278 of the Public Acts of 1909 gives the power of suppressing saloons to the village, and not the common council; (6) that the electors having such power cannot delegate it to their council. In other words, the circuit court held that the suppressing of saloons must be by the charter itself, and not by ordinance of the council. This decision necessarily goes to the extent of invalidating the charter provision above quoted.

It is the contention of the relator that if the power is given by section 24, subd. “a,” above quoted, to suppress saloons for the sale of spirituous and intoxicating liquors, that power can only be exercised by the electors of the village enacting such a measure in the charter in the manner provided by law, viz., “submission to and the approval of the same by a majority vote of the electors; and that such power cannot be redelegated to the village council.” It is the claim of the village that the general legislative policy of the State for many years has been to lodge the power of suppression by local police regulations in the local legislative body, to wit, the common council.

It is well here to refer to section 2769, 1 Comp. Laws, being what may be termed the “ Old Village Law,” and to note that the charter of the village of Grosse Pointe Shores adopted the identical language of subdivision 7 of this section. The court below eliminated from consideration this section of the Compiled Laws as having no bearing on this case. We think that it has an important bearing. It shows the general legislative policy of Act No. 278, Pub. Acts 1909. While the charter does not refer to the section or chapter as provided by section 25 of Act No. 278, we think it does by appropriate reference embrace it, and it may be said that the village charter did incorporate section 2769, 1 Comp. Laws, and that the language used by this court in Fuchs v. Grass Lake Common Council, 166 Mich. 569 (132 N. W. 96), and Lake v. Village of Cedar Springs, 162 Mich. 569 (127 N. W. 690), relating to this statute, applies here. Subdivision “ m ” of section 24 of Act No. 278 is as follows:

“ For exercising all municipal powers in the management and control of municipal property and in the administration of the municipal government, whether such powers be herein expressly enumerated or not; for any act to advance the interest of the village, the good government and prosperity of the municipality and its inhabitants; and for making all laws which shall be necessary and proper for carrying into execution the foregoing powers and all other powers vested by the Constitution in villages, except where forbidden, or where the subject is covered exclusively by a general law.

The last section of Act No. 278 provides as follow's:

“ No provision of any village charter shall conflict with or contravene the provisions of any general law of the State.”

We should not overlook the provision above referred to in section 21, art. 8, of the Constitution, which gives to the electors of each city and village, under general law, power and authority to frame, adopt, and amend its charter, and, through its regularly constituted authority, to pass all laws and ordinances relating to its municipal concerns, subject to the Constitution and general laws of this State. We are of opinion that the legislature here delegated power to villages to be exercised by local legislation of the common council to pass all laws and ordinances relating to municipal concerns, which includes the power to suppress the liquor traffic, and that this is not in conflict with either the Constitution or general laws of this State; that it may be said that the charter of the village of Grosse Points Shores has practically adopted the provisions of section 2769 of the old village act; and that this is a delegation by the legislature of general police power to the common council, as the regularly constituted authority to legislate upon the subject, within the previous holdings of this court above referred to. We think, therefore, that the circuit court reached the wrong conclusion.

We are of opinion that the provision of the charter and the ordinance in question are valid, and that the order and judgment of the circuit court should be reversed, with costs against the relator.

Moore’, C. J., and Steere, McAlvat, Brooke, Ostrander, and Bird, JJ., concurred. Blair, J., did not sit.