text:
    GOULD v. GREGORY.
    1. Malicious Prosecution — Probable Cause — Evidence—Sufficiency.
    In an action for malicious prosecution on a charge of burglary, evidence considered, and held to justify a finding of want of probable cause.
    2. Same — Malice.
    Malice in the prosecution of a criminal charge may be inferred from a want of probable cause therefor.

      3. Same — Evidence.
    In an action for the malicious prosecution of a charge of burglary, it appeared that the charge was founded upon the taking by plaintiff of a horse and a basket from defendant’s barn, and that plaintiff was at the time working for.a tenant of defendant. Held, that evidence that the contract between defendant and his tenant required defendant to furnish two teams of horses, when necessary, and such farming utensils as might be needed, was admissible, though it was conceded that plaintiff was not acting under the tenant’s orders on the occasion in question.

      4. Same.
    Evidence of the size of defendant’s farm was admissible as bearing upon the question of the right of the tenant, and of plaintiff, as his employé, to use the horse and basket alleged to have been stolen.
    5. Same.
    In an action for malicious prosecution, evidence had been admitted upon the issue of malice that defendant had stated that some one had been down to the cottages owned by him, had broken into the boathouses, and had knocked holes in the boats, and that he thought plaintiff was to blame for it. Held, that evidence as to the number of cottages owned by defendant was admissible.
    6. Same — Conduct of Counsel.
    In an action for malicious prosecution, it appeared from the cross-examination of defendant that, while he had owned a certain farm for many years, he did not know just how many acres it contained; whereupon plaintiff’s counsel said, “The idea that a man has owned a farm 30 years, and he does not know how many acres there are !” Immediately after, defendant testified that the farm lay upon a lake; that a good deal of it was fractional; that his son owned a part of it; and - that, as he had not figured it up, he could not tell within a few acres how many acres there were. Held, that the remark of plaintiff’s counsel was not prejudicial to defendant under the circumstances.
    Error to Van Burén; Carr, J.
    Submitted April 9, 1903.
    (Docket No. 27.)

    Decided June 15, 1903.
    „ Case by Rhett Gould against Albert E. Gregory for malicious prosecution. From a judgment for plaintiff, • defendant brings error.
    Affirmed.

      Coy W. Hendryx and Marshall L. Howell, for appellant.

      Hammond & Hammond and T. J. Cavanaugh, for appellee.
   Carpenter, J.

Defendant instituted a criminal proceeding before a justice of the peace of the county of Cass charging plaintiff with breaking and entering his barn with intent to steal a horse and a basket. On the day set for the examination, plaintiff was discharged at the request of the prosecuting attorney. He thereupon brought this suit to recover damages for malicious prosecution, and obtained a verdict and judgment in the lower court. Defendant asks a reversal of the judgment of the court below on the ground that the court erred in submitting the case to the jury, and in admitting certain testimony which will be hereinafter referred to.

1. Defendant insists that the court should have directed a verdict in his favor, because (a) there was no evidence of want of probable cause; (6) the testimony conclusively proves that in making the complaint defendant acted under the advice of counsel, to whom he had stated all the material facts; (c) there was no evidence of malice.

The testimony clearly proved that plaintiff did, early in the morning of November 1st, let defendant’s horse out of his barn, and take his basket therefrom. For the purpose of determining whether the defendant was justified in believing that this act was done with criminal intent, a somewhat detailed statement of the facts is required. Plaintiff had for some days been employed as a hired man by one Olmsted. Olmsted was defendant’s tenant, working on shares a farm adjacent to the barn in question. By the terms of the contract between defendant and Olmsted, the former was to furnish two teams tó be used by the latter “in working the said farm, when necessary,” and also such farming tools “ as may be needful.” The horse in question was one that defendant had furnished Olmsted, and had been used by plaintiff as Olmsted’s hired man. On tbe morning in question, though the plaintiff was not being paid wages by Olmsted, he was performing services for him. According to plaintiff’s testimony, what he did was this: He opened the stable door of defendant’s barn, which was fastened only by a button, and let the horse, which was loose in a box stall, out into an adjoining pasture, in order that it might get food and water. He took the basket to Olmsted’s for the purpose of using it, and did use it, to load potatoes. In letting the horse loose and in getting -the basket, plaintiff was not acting under instructions from Olmsted. Before defendant made the complaint, the horse was in his possession. He knew that it was found loose in the road by Olmsted about 4 p. m. of the day the alleged crime was committed. He also knew the basket was at Olmsted’s.

No authority need be cited to prove that these facts would not constitute probable cause. They would clearly not justify defendant in believing that plaintiff broke and entered his barn with intent to steal his horse and basket. Defendant, however, insists that these are not the facts, or, at least, that they are not the facts as he believed and was justified in believing. He insists that the horse was fastened in its stall by a halter, and that plaintiff led it away from the barn. He insists that the barn door was locked, or securely fastened. He testifies that he had an interview with Olmsted before making the complaint, and that Olmsted said he did not know which way the horse came from when he found it in the road at 4 p. m., and that when plaintiff brought the basket to his house Olmsted told him he would get in trouble. Defendant also insists that plaintiff, at the time he entered the barn, as he was informed by his son, Don Gregory, acted in a manner which would tend to convince an observer that he was conscious of wrong-doing.

Assuming that these facts constitute probable cause, we are nevertheless bound to hold that the trial court did not err in refusing to direct a verdict. Neither that court nor this court can say, as a matter of law, that defendant believed these to be the facts. There was a marked conflict between his testimony and that of plaintiff as to whether the horse was tied and the barn door fastened. The jury, if they accepted plaintiff’s testimony, could have found that defendant never believed that plaintiff led the horse away. There was a marked conflict, too, between the testimony of defendant and that of Olmsted. Olmsted denies having any conversation with defendant until after plaintiff’s arrest. Olmsted testifies that it is not true that the first he saw of the horse the day the alleged crime was committed was at 4 p. m. On the contrary, he testifies that he saw the horse in the pasture field between 9 and 11 a. m.; that the horse was breachy, and he presumes that he got into the road by jumping the fence. If the jury believed Olmsted’s testimony, defendant did not have by any means as much evidence of plaintiff’s guilt as he contends.

This reasoning compels us also to decide that the court did not err in refusing to direct a verdict for defendant on the ground that he had fully and fairly stated the facts in the case to his counsel; for the testimony shows — what we should know without testimony — that the facts he stated to his counsel were those which he insists he believed. If the jury accepted plaintiff’s testimony, they would be warranted in saying that defendant did not make a full and fair statement of the facts to his counsel. Moreover, it does not conclusively appear that defendant told his counsel of Olmsted’s right to use the horse and tools, and of plaintiff’s relation to Olmsted.

Neither do we think that the court should have directed a verdict for the defendant on the ground that there was no evidence of malice. Malice may be inferred from want of probable cause. Carson v. Edgeworth, 43 Mich., at page 247 (5 N. W. 282); Hamilton v. Smith, 39 Mich., at page 229. Moreover, one witness testified that defendant said, before the alleged crime was committed, that plaintiff’s “place was in Jackson, and he would like to see him there.”

This case received the attention of this court on a former occasion, and is reported in 126 Mich. 594 (85 N. W. 1077). On that occasion each of the foregoing points was made. The evidence presented by that record was in every material particular that presented by this. The majority of the court, as then constituted, reached the same conclusion as that indicated in this opinion.

2. Complaint is made because the court permitted plaintiff to prove the contract relations of defendant and Olm.sted. Counsel say:

“It was immaterial and irrelevant what the contract relation between Olmsted and Gregory was, for the reason that Gould was not acting under the instruction or request of Mr. Olmsted in the exercise of any of his rights under the contract.”

Though the plaintiff was not acting under Olmsted’s orders, the jury might properly have inferred that he entered defendant’s barn and did the acts complained of because of the obligations resting upon him as a hired man of Olmsted; and therefore the contract relations between Olmsted and Gregory were material.

3. On the cross-examination of defendant, plaintiff’s counsel was permitted to prove the number of acres in defendant’s farm and the number of cottages owned by him at Magician Lake. Defendant’s counsel urge that the purpose and effect of this testimony was simply to prejudice the jury against defendant by proving that he was a man of some wealth. We cannot assent to this reasoning. We are unable to say that the size of defendant’s farm would not have some bearing upon the rights of his tenant, Olmsted, and of his hired man, the plaintiff, to handle the horse and use the basket claimed to have been stolen. As already noted, defendant was to furnish two teams “in working said farm, when necessary,” and tools “as may be needful.” Nor was it improper to ascertain how many cottages defendant owned. For the purpose of establishing malice, a witness for the plaintiff had testified that defendant had stated “somebody had been down to his cottages, and had broken into the boathouses, and knocked, holes in the boats, or something of that kind, and that he thought Mr. Gould was to blame for it.”

In the course of this cross-examination, it transpired that, though' defendant had owned the farm for many years, he was not certain just how many acres it contained, and, after the court had first ruled (a ruling which he subsequently changed) that this was a collateral matter, plaintiff’s counsel said, “The idea that a man has owned a farm 30 years, and don’t know how many acres there is!” While we agree with counsel for defendant that, under the circumstances, this remark was improper, we do not think it was reversible error. Immediately thereafter defendant testified:

“That farm lies upon the lake, and it is all of it fractional; that is, there is a good deal fractional. * * * My son now owns a part of it, and I really haven’t figured up to see. It is divided by section lines and quarter lines, and within a few acres I couldn’t tell.”

With this explanation, we are unable to see how defendant could be harmed by the remark complained of. Indeed, that remark is more likely, under these circumstances, to have prejudiced plaintiff than the defendant.

As we find no reversible error complained of in defendant’s original brief, the judgment of the court below will be affirmed.

The other Justices concurred.


source: Caselaw Access Project

author: Carpenter, J.

license: Public Domain

text:
    WOLCOTT v. TWEDDLE.
    1. Appeal — Decree—Wrong Reason for Right Result.
    A decree which is as favorable to appellant as he had a right to ask will not be reversed because a wrong reason was given by the court for the conclusion reached.
    2. Fraudulent Conveyanoes — Mortgages—Redemption—Subrogation — Homestead.
    Where a conveyance of mortgaged lands is set aside, except as to a homestead interest, at the suit of an execution creditor, the grantee, on redeeming from the mortgage, is entitled, in the absence of special circumstances, to be subrogated to the full extent of the mortgage lien, as against a purchaser at the execution sale. JRhead v. Hounson, 46 Mich. 243, disapproved.
    3. Same — Appeal—Right to Complain.
    However, a decree requiring the homestead interest to bear its proportion of the mortgage debt was not disturbed, where the rents and profits of the premises, together with the proceeds of an insurance policy thereon, received by the grantee, more than equaled the amount deducted by the court from his ■claim under the mortgage.
    Appeal from Kent; Perkins, J.
    Submitted April 9, 1903.
    (Docket No. 25.)
    Decided June 15, 1903.
    Bill by Laurens W. Wolcott and Cyrus E. Perkins, co-partners as Wolcott & Perkins, against John J. Tweddle, to foreclose certain liens. From a decree for complainants granting insufficient relief, they appeal.
    Affirmed.

      Taggart, Denison & Wilson, for complainants.

      John J. Tweddle (E. A. Maher, of counsel), in pro. ■per.

   Carpenter, J.

Prior to November 5, 189?, Bernard Fingleton owned a farm in Ada township, Kent county, comprising about 120 acres, and including his homestead. On that day he delivered a deed of the premises to Jennie Flood. He was then owing an indebtedness, which on. October 17,1899, was reduced to a judgment against him, with others, in favor of Harry D. Jewell, judge of probate, for the use and benefit, etc., for the amount of $933.05 damages and $40.90 costs. Upon this judgment, execution was levied upon the entire premises so conveyed to-Jennie Flood. The execution creditor, the judge of probate, thereafter filed a bill in aid of execution against Bernard Fingleton and Jennie Flood. In the case so commenced, a final decree was entered October 22, 1900, by which it was decreed that the conveyance from Bernard Fingleton to Jennie Flood should be set aside for invalidity against the complainant, as a creditor of Fingleton, except as to the homestead interest of Fingleton in the premises conveyed by the deed to Jennie Flood, which homstead interest was by the decree declared to be exempt from the operation of the decree. On the 29th day of September, 1900, while the bill in aid of execution was pending, Jennie Flood conveyed the entire premises, by a quitclaim deed, to the complainants in this case, Laurens W. Wolcott and Cyrus E. Perkins, composing the firm of Wolcott & Perkins, who had been acting to some extent as her solicitors in the litigation.

Bernard Fingleton, before delivering the deed to Jennie. Flood, executed a mortgage upon the entire premises to Frances Eby for $2,500. The good faith and validity of this mortgage were never questioned, and it has always been conceded to have been, in the hands of the mortgagee, a lien upon the entire premises, paramount to the claims and rights of all the other parties. Foreclosure of this mortgage was commenced, and a final foreclosure decree was entered December 10, 1900. A foreclosure sale was made by the commissioner on March 2,1901, at which time the entire premises were sold to L. Frank McKnight for the sum of $2,440.87; the sum received upon such sale being $1 in excess of the total amount due at the date of the sale, under the decree, for principal, interest, and costs. The time for redemption from this sale expired September'2, 1901. On August 29, 1901, Wolcott & Perkins, being the owners of the equity of redemption in the premises subject to the execution levy, redeemed from the mortgage foreclosure sale, paying to the purchaser, through the register of deeds, the full amount, with interest, being $2,512.87.

On January 14, 1902, the entire premises were exposed for sale under the execution levy, as aided by the chancery decree. At this sale it was agreed between the execution creditor and Y/olcott & Perkins that, instead of setting off a separate homestead, the entire premises might be sold together, subject to the $1,500 homestead lien. The sale was made accordingly. This agreement was embodied in the sheriff’s certificate of sale, and John J. Tweddle, the defendant, became the purchaser, paying therefor two days later $1,205. The total value of the premises at this time was $4=,000. At the execution sale these complainants, Wolcott & Perkins, gave notice that they claimed not only the $1,500 homestead lien upon the premises, but also a lien by subrogation for the entire amount of the Eby foreclosure sale, which they had been compelled to redeem from and pay in order to protect their homestead interest, making their total lien upon and claim against the premises $4,069, subject to which, they insisted, any purchaser at the sale would take the property. Later in the same day, and before Mr. Tweddle, the purchaser, had paid anything, they embodied these claims and demands in a formal written notice duly served upon him.

About January 1, 1898, a barn standing upon the homestead part of the premises, of the value of $1,072, was destroyed by fire, for which Mrs. Flood obtained that amount upon insurance. She paid $467.70 of this upon the mortgage debt, so that she retained a net balance from the insurance money of $604.30; and this, with interest at 5 per cent, to the time of the entering of the decree in the court below, would amount to upwards of $745. No account was taken of this matter -in 'making the decree.

Mr. Tweddle, the - purchaser, declining to make payment of this amount, the complainants thereupon, on January 16, 1902, filed this bill of complaint. They set up the facts hereinbefore recited, and alleged that, by virtue of their redemption from the Eby foreclosure sale, they became subrogated to the position of the mortgagee, and entitled to enforce the entire mortgage claim against the entire premises.- They alleged, also, that the defendant purchased at the execution sale with full knowledge of their claim, and took the premises subject both to the mortgage subrogation claim and to the homestead claim. They asked for a decree declaring, enforcing, and foreclosing these two liens. The court below held that the complainants were entitled to subrogation on account of their redemption from the Eby foreclosure, but that the homestead interest, being subject to this mortgage, and being three-eighths of the entire value of the mortgaged property, should bear three-eighths of the mortgage burden. He’therefore charged the premises with a lien in favor of -complainants for the $1,500 homestead interest, and $1,570 of the portion paid for the redemption of this mortgage, but denied the complainants’ claim for a lien for the balance of the redemption money, viz., about $941. Complainants appeal.

The court below reached the conclusion stated upon the authority of the case of Rhead v. Hounson, 46 Mich. 243 (9 N. W. 267), which case apparently supported the holding of the circuit judge. In that case the owner of property consisting of a homestead and other lands, subject to a mortgage covering the whole, made a conveyance fraudulent as to creditors. This conveyance was attacked, and the court held not only that the conveyance was void as to the excess over the homestead interest, but that the homestead interest should bear its proportion of the incumbrance in an adjustment of equities between a purchaser at an execution sale and the fraudulent grantee. Were the question involved in that case the only one to be considered in the present case, we should be compelled to hold that that case is not in line with numerous decisions of this court before and since its promulgation, and should not hesitate to overrule it. It has been frequently decided that, in foreclosure proceedings covering a homestead and other lands, the primary fund for the payment of the mortgage is the land other than the homestead. It has also frequently been decided that by a conveyance of premises in which a homestead interest exists in the grantor, and an incumbrance covering that and other property, in which the aggregate of the incumbrance and the homestead interest exceeds the total value of the property, no fraud can be said to be perpetrated as against existing creditors. The cases of Armitage v. Toll, 64 Mich. 412 (31 N. W. 408), and Kozminski v. Kuzniak, 118 Mich. 621 (77 N. W. 242), are, in principle, inconsistent with the holding of Rhead v. Hounson.

It remains to be considered whether the complainants in this case are entitled to any greater lien than the court decreed. If the decree of the court below was as favorable to complainants as they had a right to ask, it will not be reversed because a wrong reason was given for the conclusion reached. By the decree in Jewell against Fingleton and Flood, it was determined that the deed from Fingleton to Flood should be set aside, vacated, and declared null and void and of no effect whatever as against the complainant in that case, except as to the homestead interest of Bernard Fingleton in the premises, which was declared to be exempt from the operation of the decree. The homestead interest referred to in that decree was, of course, the homestead interest possessed at the time the conveyance was made. The complainants stand in the same relation to this property as would Mrs. Flood had she not conveyed the land. It appears by her testimony that she bought subject to this mortgage. In one proceeding she stated that she had assumed to pay the mortgage. In her testimony used in this case she stated that she was to pay the interest on the mortgage, and the fair import of her testimony, as qualified by testimony given in this case, is that she did assume to pay the mortgage, provided she had the property. As we have seen, after the conveyance to her there came into her hands $1,072 insurance money, which was received in substitution for the res to that extent. Of this she applied but a portion in payment on the mortgage, leaving a balance in her hands of $604.30, derived from this conveyance, and which should, in equity, have been applied, as of the date of its receipt, in extinguishment of the mortgage lien. If interest on this be computed to the date of complainants’ redemption, — say, 3£ years, — the amount is $710.50. If Mrs. Flood’s testimony be accepted that she was to pay the interest on the mortgage, it must be assumed that this arrangement and understanding was made without reference to the insurance money, as it was, of course, not known at the time that this would come into her hands. But, apart from any such arrangement, it was fairly equitable that she should pay this interest money. From the time of the-conveyance to her, in 1897, she and her grantees have had the use of the entire premises. It would be grossly inequitable to permit the grantee in this fraudulent conveyance to shelter herself behind this homestead claim, reduce to her possession all that has substance in the remainder of the estate, and still assert that in equity she is entitled to subrogation for the discharge of this lien upon the property, granted fraudulently and with the purpose of defeating creditors.

At the time of the conveyance, the property, in its then condition, was worth $5,000, with the buildings intact. It was subject to a mortgage of $2,500 and a homestead right of $1,500, leaving an interest of at least $1,000 which creditors had the right to reach. The possession acquired under this conveyance, valid only as to the homestead interest, has enabled the grantee to receive all the rents and profits from the day of her deed, November 5, 1897, until August 29, 1901, without further investment, and to obtain the insurance money above referred to. The property has in the meantime, by reason of the destruction of the barn, from which the insurance was realized, been reduced in value to $4,000. The right of the creditors to pursue the property has, according to complainants’ contention, vanished, as the mortgage and the homestead interest, if both are given full priority, fully equal the value of the property. This is not equity. The doctrine of subrogation is administered upon equitable principles. If Mrs. Mood had applied at the time of its receipt the proceeds of the insurance on this barn, and was charged with the value of the rental of this land over and above the homestead interest, it is unquestionable that the amount which she would be entitled to assert as a claim to subrogation would be less than that awarded to her by the court below. While the evidence is not very clear as to the rental value of the land, it may fairly be assumed that it bore some relation to the value of the property; and, upon any basis which the record affords, we think it appears that the insurance money, added to the rentals with which complainants and their grantor should be charged, exceeds the amount which they assert as an added claim against the land.

The decree was sufficiently favorable to the complainants, and will be affirmed, with costs of this court to appellee.

The other Justices concurred.


author: Grant, J.

text:
    PREFERRED TONTINE MERCANTILE CO. v. SECRETARY OF STATE.
    Mandamus — Corporations'—Articles of Association — Filing.

      Mandamus will not issue to compel the Secretary of State to file the articles of association of a foreign corporation (e. g., a tontine investment company), where, subsequent to the filing of the petition, a statute has become operative under which the rights claimed by relator have been abrogated.

      Mandamus by the Preferred Tontine Mercantile Company to compel Fred M. Warner, Secretary of State, to file relator’s articles of association.
    Submitted May 12, 1903.
    (Calendar No. 19,642.)
    Writ denied June 15, 1903.

      Groesbeck & Berger, for relator.

      Charles A. Blair, Attorney General (Charles W. McGill, of counsel), for respondent.
   Grant, J.

On October 16, 1902, relator, a corporation organized under the laws of Missouri, filed its petition to compel the respondent, Secretary of State, to file its articles of association. On November 18th, respondent answered, admitting his refusal to file its articles, upon the ground that its business proposed to be carried on was against public policy, and its contracts unlawful and void. On December 1st, relator filed a petition to frame issues of fact. On April 30, 1903, the proposed issues were presented to the court. The respondent denies the necessity of any issues of fact; alleging that the articles of association and contracts, copies of which are attached to the answer, and the announcements made by the company, also attached, show upon their face the illegal character of the relator’s business.

The respondent has filed in this court a certified copy of an act of the legislature which was approved April 27th last, and given immediate effect. Act No. 60, Pub. Acts 1903. This is an act “to provide for the regulation in this State of foreign tontine, bond, certificate, and investment companies, partnerships, and associations,” etc. This act has evidently abrogated the rights claimed by the relator under the law as it stood before the passage of this act. It would be of no advantage to relator to have its rights under the former law determined. The writ of mandamus would be useless, even if we should hold now that relator was entitled to do business under the law as it was when the petition was filed. Its right to do business must now be determined by the new act.

The writ is denied.

The other Justices concurred.


text:
    PERE MARQUETTE RAILROAD CO. v. CITY OF LUDINGTON.
    1. Railroads — Taxation—Exemptions.
    A stock of groceries kept by a railroad company to furnish supplies for the crews and passengers of a line of steamboats operated by it under authority of 2 Comp. Laws, § 6269, is not subject to taxation under the general tax law, but is expressly exempted therefrom by 2 Comp. Laws, § 6277, providing for the payment of specific taxes by railroad companies “in lieu of all other taxes upon the properties of such companies,” except certain specified real estate.
    2. Taxes — Payment Under Protest — Limitation oe Actions.
    The provision of 1 Comp. Laws, § 3876, limiting to 30 days the right to sue to recover taxes paid under protest as therein provided, has no application to an action to recover taxes paid involuntarily, though such payment was accompanied by a written protest.
    Error to Mason; McAlvay, J.
    Submitted April 23, 1903.
    (Docket No. 44.)
    Decided June 15, 1903.

      Assumpsit by the Pere Marquette Railroad Company against the city of Ludington to recover taxes paid under protest. From a judgment for defendant, plaintiff brings error.
    Reversed.

      M. B. Danaher UP. W. Stevens, of counsel), for appellant.

      Henry C. Hutton, for appellee.
   Carpenter, J.

This is a suit brought by the plaintiff 'to recover from the defendant a tax claimed to have been illegally assessed, and paid involuntarily and under protest. In the year 1899 the city of Ludington assessed the tax against the plaintiff on account of its ownership of a stock of groceries, of the value of about $1,000, situated in its warehouse in said defendant city. This stock of groceries was kept to furnish supplies for the crew and passengers on a line of steamboats owned and operated by plaintiff. These boats ran between said city of Ludington,- one of plaintiff’s termini upon Lake Michigan, and points in Wisconsin. On February 28, 1900, the city treasurer of Ludington, under a warrant for the collection of said taxes, levied on certain personal property of plaintiff. Thereupon, under a written protest, plaintiff paid the tax, and subsequently, on the 9th of April, commenced this suit. The case was tried before the judge without a jury, who, after finding the foregoing facts, rendered a judgment for the defendant, on the ground that the assessment was legal and the suit not brought within the time limited by law. We are called upon to consider the correctness of each of these holdings.

1. The legality of the assessment under consideration depends on whether the stock of groceries was taxable under section 6277, 2 Comp. Laws. That section reads:

“ Every railroad company and union railroad station and depot company owning or operating any railroad situated in whole or in part in this State shall, on or before the first day of July in each year, pay to the State treasurer, on the statement of the auditor general, a specific tax upon the property and business of such railroad corporation operated within the State, which tax shall be computed in the following manner, namely: Upon all such gross income not exceeding $2,000 per mile of road actually operated within this State, two and one-half per cent, of such gross income; upon such gross income in excess of $2,000 and not exceeding $4,000 per mile, three and one-fourth per cent, thereof; upon all such gross income in excess of $4,000 and not exceeding $6,000 per mile, four per cent, thereof; and upon all such gross income in excess of $6,000 per mile, and not exceeding $8,000 per mile, four and one-half per cent, thereof; and upon all •such gross income in excess of $8,000 per mile of the road so operated, five per cent, thereof; that all gross income of union railroad station and depot companies whose earnings are in excess of $20,000 per mile shall pay on all such gross incomes in excess of $20,000 per mile of road so operated ten per cent, thereof. And when the railroad lies partly within and partly without this State, prima facie, the gross income of said company from such road for the purposes of taxation shall be on the actual earnings of the road in Michigan, computed by adding to the income derived from the business transacted by said company entirely within this State such proportion of the income •of said, company arising from interstate business as the length of the road over which said interstate business is carried in this State bears to the entire length of the road over which said interstate business is carried. The taxes so paid shall be in lieu of all other taxes upon the properties of such companies, except such real estate as is owned and can be conveyed by such corporations under the laws of this State, and not actually occupied in the exercise of its franchises, and not necessary or in use in the proper operation of its road; but such real estate so excepted shall be liable to taxation in the same manner, and for the same purpose's, and to the same extent, and subject to the same conditions and limitations as to the collection and return of taxes thereon, as is other real estate in the several townships or municipalities within which the same may be situated.”

It is contended by defendant, notwithstanding the fact that section 6269, 2 Comp. Laws, authorizes plaintiff to own and operate the line of steamboats, that the language, “the taxes so paid shall be in lieu of all other taxes upon the properties of such companies,” except certain specified real estate, does not relieve plaintiff from liability to pay taxes upon said steamboats and the supplies used thereon. This contention places a narrow and strained construction on the language above quoted. In violation of sound principle and authority (Suth. Stat. Const. §328; Sherwin v. Bugbee, 16 Vt., at page 445; Brocket v. Railroad Co., 14 Pa. St., at page 243 [53 Am. Dec. 534]; Miller v. Kirkpatrick, 29 Pa. St., at page 229), it attempts to add other exceptions to those specified in the statute.

It is argued that this construction, excepting steamboats and their supplies from the property exempted, is warranted by the language of the statute itself. It is argued that, since the specific tax is upon “the property and business of such railroad corporation operated within the State,” the exemption cannot be extended to the line of steamboats, which are operated in part outside the State. The language above quoted points out the subjects on account of which the specific tax is paid. The .statute provides that, on account of its property,- — -which, in the absence of qualifying words, means its taxable property, —and its business operated in this State (and this would comprise all its taxable interests), the railroad company shall pay as a specific tax a certain part of its gross income. There is nothing in this language to indicate that the property on account of which the specific tax is paid is anything less than the entire taxable property of the railroad company, for surely the words “operated within the State” qualify the word “business,” and that word only.

The argument is also made that, according to the proper construction of section 6277, the gross income upon which specific taxes are paid includes no part of the revenue derived from steamboats, and therefore said steamboats are taxable. This argument is very forcible, if the assumption upon which it is based is well founded, for it is scarcely conceivable that the.legislature intended to exempt both the steamboats and their earnings from taxation. We do not think, however, that said assumption is well founded. We cannot agree with defendant that, according to the proper construction of section 6277, the gross income upon which the specific tax is paid includes no part of the earnings of the steamboats. Defendant argues that the steamboats are taxable because their earnings are not taxable. We think, however, there is greater force in the opposing argument, that, as the steamboats are exempt from taxation, their earnings are not.

The court below relied, and defendant’s counsel now relies, upon the case of Illinois Central R. Co. v. Irvin, 72 Ill. 452. There it was held that legislation exempting the plaintiff railroad company from taxation “upon all the property and assets of every name, kind, and description belonging to said corporation” did not apply to a steamboat and wharfboat owned by it, and used in transferring passengers and freight. That decision is based upon the ground that the railroad company was not authorized by its charter to “engage in carrying by water, or otherwise than by the lines of railway so to be constructed.” That reasoning, applied to the facts in this case, would lead to an entirely different conclusion,- and entitle plaintiff to judgment.

If plaintiff is under no obligation to pay taxes upon its line of steamboats otherwise than by paying a percentage of its gross income, no argument would seem necessary to prove that supplies of food for the boats, like supplies of fuel for the engines on its railroad, are not taxable.

Defendant’s counsel apprehends injury to the public if the railroad company is permitted to invest money to the amount of $1,000 in groceries and be exempt from paying taxes thereon. If the plaintiff had deposited this $1,000 in the bank as a fund for the purchase of supplies from day to day, obviously it would have escaped taxation upon this money, and it is just as obvious that the injury to the public would have been the same as it. now is. In establishing a specific tax in lieu of all other taxes, we do not think the legislature intended to prevent railroad companies purchasing supplies at such times and in such quantities as business judgment might demand. This decision does not, as defendant’s counsel seems to fear, establish a precedent which exempts supplies purchased by the railroad company for the purpose of “going into the grocery business.” The reasoning of this case, as we think must be apparent to every reader, applies only to supplies intended to be used for some legitimate purpose of the corporation.

2. The circuit judge held that section 3876, 1 Comp. Laws, was applicable to this case, and prevented a recovery by the plaintiff, because it waited more than 30 days after paying the tax in question before commencing this suit. Section 3876 reads:

“Any one * * * may pay any tax, whether levied on personal or real -property, under protest, to the treasurer, specifying at the time, in writing signed by him, the grounds of such protest, and such treasurer shall minute the fact of such protest on the tax roll and in the receipt given. The person paying under such protest may, within 30 days and not afterwards, sue the township for the amount paid, and recover if the tax is shown to be illegal for the reason specified in such protest.”

No protest was required, either before this statute was passed or since, to recover the taxes in question, because they were paid involuntarily. See Cox v. Welcher, 68 Mich. 263 (36 N. W. 69, 13 Am. St. Rep. 339). Plaintiff’s right of action, therefore, does not rest upon this statute. If it had made no protest at all it could have recovered, and then, clearly, the 30-day limitation would not have applied. The right to recover without making a protest surely was not l'ost by making a protest. The 30-day limitation, therefore, applies only to cases in which, without a protest, one cannot recover back taxes paid by him. It does not apply to this case.

We conclude, therefore, that the judgment of the trial court must be reversed, and a j udgment entered in this court for plaintiff, with costs of both courts.

The other Justices concurred.


author: Montgomery, J.

text:
    DAILEY v. SAGINAW BUILDING & LOAN ASSOCIATION.
    1. Building and Loan Associations — Minimum Premium— Competitive Bidding.
    A by law of a building and loan association fixing a minimum premium is not prejudicial to a borrower, where his loan is made at an advance after competitive bidding.
    S. Same — Foreclosure—Settlement—Bill oe Review.
    Where, subsequent to a foreclosure decree in favor of a building and loan association, the borrower claimed that he had not been credited with certain payments, and the association returned to him a part of the amount claimed, taking his receipt in full of all claims of every kind against the association, he could not afterwards maintain a bill to review the decree upon the ground that he was entitled to credit for further payments, and for certain fines which had been unlawfully imposed.
    3. Same — Pleading.
    The fact that a settlement between a building and loan association and a borrower, had after foreclosure against both the borrower and his wife, was participated in by him alone, will not warrant reversing an adverse decree on a bill of review brought by both, where it was not relied on in the bill.
    Appeal from Saginaw; Beach, J.
    Submitted May 15, 1903.
    (Docket No. 85.)
    Decided June 15, 1903.
    . Bill by George W. Dailey and Mary Dailey against the Saginaw Building & Loan Association and Mary G. Lewis to review a decree of .foreclosure. From a decree dismissing the bill, complainants appeal.
    Affirmed.

      George G. By an (Eugene A. Snotv, of counsel), for complainants.

      Nathan S. Wood, for defendants.
   Montgomery, J.

This is a bill in the nature of a bill of review. The original bill was a foreclosure bill, and was filed on November 3, 1894. There was personal service. The Daileys appeared by their solicitor; Mr. Emerick. There was a waiver of service of further notices, and decree was entered in the sum of $3,041.52 and costs, and a sale was advertised, under the decree, for December 21, 1895. Mr. Dailey was present, and asked for and procured an adjournment to December 2Gth, when a sale of' the property was made for $3,000, and a deficiency of $304.21 reported. The building association took possession soon after the sale. Four years after this sale was made, complainants, Dailey, discovered receipts for money paid to the'association aggregating $185, which appeared not to have been credited to the Daileys in the foreclosure proceeding. Negotiations were had between themselves, represented by their attorney, and the association, and in November, 1899, nearly four years after the sale, the amount represented by these receipts, with an agreed rate of interest, was paid to Dailey; and a receipt was given, reciting that it was in satisfaction of any and every claim of every kind and character against said association.

The present bill of complaint was filed in February, 1901, more than a year after this settlement, and more than five years after the decree. The bill sets up the claim that, in making the original loan of the association, a minimum premium was fixed by the association of 25 per cent., and that the Daileys’ bid was 30 per cent, on the loan. They also set up the claim that they had not received credit for the $185, and did not discover this error until 1899; but it is conceded that the matter was then adjusted, and the money repaid them. They also claim that other payments were made for which no credit was given, and seek to prove this by entries in books in their own possession, and claim that certain fines imposed were improper.

The evidence discloses that there was a by-law fixing a minimum premium of 25 per cent.; but it also appears that the several loans in which complainants are interested were made after competitive bidding, and that the premiums bid, and upon which the loans were awarded, were 30 and 31 per cent. It further appears that all loans made up to the time that complainants’ loans were effected were made upon competitive bidding, and at a per cent, considerably above the minimum fixed by the rules. Under these circumstances, it. cannot be said that the rule worked any damage to the complainants. The benefit of free and competitive bidding was had, the same as though no fixed minimum premium had been adopted. While the authorities are not numerous upon the question, a well-reasoned case (Orangeville Mut. Sav. Fund & Loan Ass’n v. Young) is reported in 9 Wkly. Notes Cas. p. 251. See, also, Albright v. Building & Sav. Ass’n, 102 Pa. St. 411, 424; Endl. Bldg. Ass’ns, § 411.

the bill also sets up a claim that, in the exchange of property between the defendant Mary G. Lewis and complainants, a loan had been effected upon the property exchanged by Mrs. Lewis with complainants of $400, and that this was concealed from complainants, and that the defendant association was a party to the fraud which was perpetrated upon complainants by such concealment. This is a serious charge, which present's a question of fact, and complainants’ claim is supported solely by the testimony of Mr. Dailey. By the overwhelming weight of testimony, this claim is shown to be without any basis of fact. The documents introduced in evidence, and the course of dealing of the parties, leave in our minds no room for doubt that this mortgage was placed upon the property before the exchange was made, and was well known to the complainants, and taken into account in the exchange. Not only are we convinced of this, but so clearly does the testimony satisfy us of this conclusion that we should hesitate to base a decree upon the unsupported recollection of the complainant Dailey. He is so clearly in fault in this particular that the inference of either bad faith or a want of accurate recollection should be applied with more or less force to his other testimony in the case.

The claim is made that a considerable amount of money was paid into the association for which the complainants have not received credit. We cannot overlook the fact that there has been a long delay in asserting this claim. The secretary of the association at the time the payments-are claimed to have been made is now at a distant place, and is shown to have been dishonest. But it is significant that the books in which the credits were given were always open to the complainants, and that investigation of these books was attempted at a time when the settlement hereinafter referred to was made. We should hesitate after this-lapse of years to base a decree upon the unsupported testimony of complainants to these payments. But a more-complete answer to this claim exists. The bill of complaint recites the discovery by complainant of certain receipts from the building and loan association, an investigation, and the settlement and adjustment hereinbefore referred to, in which a release was given of all claims made by complainant against said association for money which he claimed to have paid the association on account of any and every loan or advance made to him by the association, and of any and every claim of every kind and character against said association growing out of his relations thereto. The only attack made-upon this settlement is the complainants’ claim that other facts and the fraud set forth in the bill were not then known to the complainants ; and it is claimed on the hearing that the settlement only related to payments which aggregated $185, while, as a matter of fact, it is now claimed that something more than $800 had been paid and not credited.

We are satisfied from the record that other claims in excess of the claim of $185 were made at the time, and that this settlenient was intended to be a final and definite settlement of all matters in controversy between the parties. It should be borne in mind "that at this time a deficiency decree of $304.-81 existed in favor of the association against complainants. At the time complainant claims to have discovered that he had not been credited with all that had'been paid by him, he -had the means of ascertaining, as he has since ascertained, all the facts in relation thereto. The testimony of the witnesses who were members of the committee is to the effect that.other claims than the $185 were in fact made. It was clearly the duty of the complainant to then assert whatever claims he had to make. There certainly was no fraud or artifice practiced by the association at this time. The payment was made upon the definite agreement that it should be final, and we think it should be so treated. It is suggested that the complainant Mary Dailey was not a party to this arrangement; but the answer to this is that the bill of complaint proceeds upon no such theory. On the contrary, it recognizes the settlement, and only attempts to avoid it by matters common to both Mr. and Mrs. Dailey.

The only other question which need be referred to is the alleged imposition of excessive fines. The total amount of fines imposed is stated to have been $131.43. It is not accurately shown to what extent these were excessive, but we think the question is open to the same considerations that the alleged overpayments are. After this decree had passed, and the error had been discovered, we think it was incumbent upon the complainants to make their claims once and for all, and that, when the receipt was given under the circumstances detailed, it constituted a complete accord and satisfaction. Freeman v. Freeman, 68 Mich. 28 (35 N. W. 897).

The decre'e of the court below will be affirmed, with costs.

The other Justices concurred.


author: Moore, J.

text:
    MICHIGAN MUTUAL LIFE-INSURANCE CO. v. COMMOM COUNCIL OF DETROIT.
    Taxation — Liee-Insuranoe Companies — Reserve Fund.
    The reserve fund of a life-insurance company is properly included among its liabilities in determining the net assets of the company for the purpose of taxation under 1 Comp. Laws, § 3834.

      Certiorari to Wayne-; Brooke, J.
    Submitted June 2, 1903.
    (Calendar No. 19,973.)
    Decided June 15, 1903.

      Mandamus by the Michigan Mutual Life-Insurance Company against the common council and the board of assessors of the city of Detroit to compel the reduction of an assessment against relator. From an order granting the writ, respondents bring certiorari.

    Affirmed.

      C. A. Kent, for relator.

      Timothy E. Tarsney, for respondents.
   Moore, J.

An assessment for personal property was made against the relator of $6,936,584.87. Upon application to the circuit court this amount was reduced to $2,055.05. This action of the circuit judge is sought to be reviewed by the writ of certiorari.

The facts are not in dispute. The December, 1902, report of the relator to the commissioner of insurance showed its gross assets to be $7,777,714.86. When its liabilities are deducted, its surplus is $404,269.90. The real estatb was shown to be-valued at $402,214.85, which, deducted from its net assets, left $2,055.05, which amount the court below found to be the amount of the personal property which should be assessed against the company. It is the claim of the respondents that relator should be assessed for personal property to the full amount of its gross assets, less the value of its real estate. It is claimed subdivisión 5 of section 3832, 1 Comp. Laws, should apply as to exemptions, and that the reserve fund of the company does not represent a debt due or to become due, within the meaning of the statute, which may be deducted from the assets, but represents a contingent liability only; citing the recent case of Detroit Fire & Marine Ins. Co. v. Hartz, 132 Mich. 518 (94 N. W. 7). We will refer to that case later. It is the claim of relator that, even if subdivision 5 of section 3832 is to control this assessment, the reserve fund represents debts which should be exempt from taxation. The following cases would seem to sustain that contention.

In discussing the question of whether the reserve fund of a life-insurance company should be exempt from taxation under a general law applying to all taxpayers, the court in Alabama Gold Life-Ins. Co. v. Lott, 54 Ala. 499, used the following language:

“To contract obligations that shall be discharged in money, payable upon the happening of the death of those whose lives are insured, or other designated future events, in consideration of premiums to be in the meantime periodically paid to the companies, is the proper and especial business of life-insurance associations. Their success and prosperity, when honestly and prudently' managed, are measured by the number and amount of such obligations created by the policies they issue. To be indebted is, therefore, their normal condition, a condition necessary to their healthful vitality, while their actual wealth at any time consists only of the surplus of their assets (composed almost entirely of credits) over and above their indebtment at the same time.
“Of course, the indebtment of such a company is not identical with the aggregate of all the sums for which its policies are issued; for, while these are running to maturity, they bring into the company a stream of the premiums in consideration of which they were issued, and which, being added to those that have previously flowed in, constitute the supply out of which the company discharges the frequent demands arising out of the expiring policies, and the dividends that may be due to stockholders, as well as its current expenses. This supply should always exceed the amount of estimated present indebtment at any time, the proper provision for which is supposed to be the fund known as ‘the premium reserve,’ which, however, may be embraced in and be a part of the general assets of the company. The amount of this fund depends upon the amount of the policies outstanding, payable in the future, generally soon after the death of persons on whose lives they are given, and is determined by men skilled as actuaries, who ascertain, according to certain rules.or methods of computation, what is at any time the present value of all such outstanding policies, or (what is equivalent thereto) the sum that is required to safely reinsure them; and this sum or value, representing what all the policies are worth at the particular time, or what other insurance companies would charge for taking the same risks, is the-measure of the company’s indebtedness at that time to its policy holders, and is habitually set down in the annual or other periodical statements required in many of the States by law to be made of the assets and liabilities of life-insurance companies, as an item, and the principal item, of present indebtedness. The amount of the liabilities upon all the outstanding policies is, of course, many times greater; and by an unusual mortality in a particular year the losses of a company might amount, and its indebtedness be increased, to a larger sum than its estimated ‘reserved fund.’ But this fund is doubtless generally adequate, and the method of ascertaining it is probably as accurate as any that can be devised under the direction of a court, or be used by a company desirous to do right, of determining the amount of its present indebtedness at any particular time. * * *
“A life-insurance company, therefore, when its solvent credits are assessed for taxation under a statute which declares that from them ‘ the indebtedness of the taxpayer shall be deducted, and that the excess only shall be taxed,’ ought to be allowed to have deducted therefrom its ‘premium reserve.’ Unless this be done, an invidious discrimination will be made against institutions which it cannot be supposed the legislature intended to tax out of existence.”

The same question was presented to the supreme court of Iowa in Equitable Life-Ins. Co. v. Board of Equalization. The court at first held according to the contention of the respondents here. A rehearing was ordered (74 Iowa, 178 [37 N. W. 141]), and, after very elaborate arguments, the court held that the reserve fund of the company represented its indebtedness to its policy holders, and should be exempt from taxation; quoting with approval the case of Alabama Gold Life-Ins. Co. v. Lott, supra. This case was again followed in Hawkeye Ins. Co. v. Board of Equalization, 75 Iowa, 770 (37 N. W. 966).

_ The legislature of this State recognizes the fact that a premium paid to a life-insurance company does more than simply pay for a period of time equal to the interval between the payments. Section 7206, 2 Comp. Laws, provides that, after the third payment has been made, a policy shall not be forfeited for nonpayment of premium, and provides a method of ascertaining its net value. As every policy holder must at some time die, if any promise based on a past consideration to pay a sum of money on an event sure to happen constitutes a debt, it is very clear that, upon the great bulk of the policies issued to the holders thereof by this company, there is an indebtedness which is sure to mature. The legislature has recognized this condition of affairs, and requires the officers of each life-insurance company annually to make a detailed statement of its affairs. Section 7200, 2 Comp. Laws. Section 7207 requires a valuation of all the outstanding policies to be made, and prohibits any company from doing business in the State unless its assets shall equdl the net value of its outstanding obligations, and provides in detail how this shall be determined. It clearly recognizes that, to arrive at the net-assets of the company, it is necessary to deduct from its gross assets its liabilities; and it is equally clear that the property owned by an insurance company cannot be said to be more than the difference between these two sums.

But, whatever may be said as to whether this exemption should be made under the terms of the general tax law, the legislature has not left.the method of assessing the personal property of life-insurance companies in doubt. Section 3834, 1 Comp Laws provides just how it shall be done. That statute was onstrued in a former case between the parties to this record which case is reported in 129 Mich. 104 (88 N W 405). The case was so recently decided it is not necessary to do more than refer to it. It is said, however, by counsel for respondents, that but one question was presented in that case, to wit, the constitutionality of that part of section 3834, 1 Comp. Laws, which authorized the insurance commissioner to determine the amount of the personal property for which the company should be assessed. It is true the unconstitutionality of the law was the principal question as presented by counsel; but the answer interposed averred, among other things, “that the liabilities of life-insurance companies are contingent liabilities, and are conditioned upon the continuation of the payment of premiums by said policy holders to said companies.” In the brief of counsel it was urged as a reason why the law was invalid: “Because the statute fixes an arbitrary rule for the determination of the liabilities of insurance companies, which ignores the fact that insurance contracts are of various classes, to wit, straight life, term, paid-up, annuity, etc.; that certain contracts are forfeitable; that others are nonforfeitable; that others have a fixed surrender value; that all are contingent, and not absolute, liabilities.” After the decision was rendered, an application was made for a rehearing, which was denied. In the brief of counsel it was again urged: “Our contention is that the obligations arising’ under insurance policies are contingent liabilities; * * * that the aim of the statute is to offset against credits the unqualified obligations owing by the person taxed, which deci’ease his taxable property in fact.” So we had before us, involved in the question as then presented, the same claim which is made by counsel now. If the law is constitutional, as we held in that case, it is decisive of this case.

It is said that this case was overruled in Detroit Fire & Marine Ins. Co. v. Hartz, 132 Mich. 518 (94 N. W. 7). The court did not understand it was overruling it, but, on the contrary, cited it with approval. In that case the relator sought to go behind the determination of the commissioner, and asked to have deducted from the net assets, as determined and reported by the commissioner, an item of bonds, which presumably represented a portion of the investment to meet liabilities which were determined to be such by the commissioner. The statute was sustained, following the case of Michigan Mut. Life-Ins. Co. v. Hartz, 129 Mich. 104 (88 N. W. 405). It was also said that the writ could not issue in any event, because, if that law could not be sustained, and therefore the federal bonds included in the assets should have been deducted by the assessor, he would also be obliged to deduct from the liabilities the reserve fund (i. e., unearned premiums), which could not be called a bona fide indebtedness under the general law, which would then apply. This does not militate against the relator’s contention in this case.

The order of the circuit court is affirmed.

The other Justices concurred.


author: Moore, J. Carpenter, J.

text:
    FREUD v. DETROIT & PONTIAC RAILWAY CO. CANDLER v. SAME.
    1. Street Railways — Encroachments on Private Property-Injunction.
    A corporation operating a suburban electric railway has no right, upon the refusal of an abutting owner to sell a strip of land desired by it, to enter thereon, without any attempt to exercise the power of eminent domain, cut shade trees, grade the property, and construct its track; and equity will enjoin it from so doing.
    3. Same — Location op Tracks — Authority op Township Board.
    The provision of 2 Comp. Laws, § 4097, relating to the improvement of the public highways, that no earth shall he dug, plowed, or scraped nearer than eight feet of the margin of the highway without the consent of the abutting owner, does not limit the power of the township board under section 6446, so as to prevent it from authorizing the construction of a street railway within eight feet of the highway line. Moore and Montgomery, JJ., dissenting.
    Appeals fi'om Oakland; Smith, J.
    Submitted November 19, 1902.
    (Docket Nos. 106, 107.)
    Decided June 23, 1903.
    Bills by Leopold Freud and others to enjoin the Detroit & from constructing its track on by Homer W. Candler and Bontiac Railway Company complainants’-lands. From decrees dismissing the bills, complainants appeal.
    Reversed.

      Keena & Lightner (John H. Patterson, of counsel), for complainants.

      James H. Lynch (Fred A. Baker, of counsel), for defendant.
   Moore, J.

This is an appeal from a decree dismissing injunction bills. The circuit judge was of the opinion that complainants had a remedy at law. The following statement of facts, which is fully justified by the record, is taken from the brief of the solicitors for complainants:

‘£ The two cases in the above title were heard together. The circuit judge filed one opinion in the two cases. Separate decrees were entered, and appeals taken. Except for ,the description of the property, the amended bill of complaint in the Freud case is substantially identical with the bill of complaint in the Candler case, and the answers of defendant are substantially idexxtical.
“The complainant Freud, in the one case, and the complainants Candler Bros., in the other case, are owners of sepax-ate parcels of land fronting on the -west side of the Detroit & Birmingham Blank Road, which is a continuation of Woodward avenue, in Detroit. The Candler property includes a little less than 20 acres, and was bought by them from Mary Granger in 1892 or 1893. It is situated a short distance northerly of the boundary between the counties of Wayne and Oakland, and it has a frontage on Woodward avenue, so called, of about 924 feet. The Freud property adjoins the Candler place immediately on the north. It includes about 29 acres, and was purchased by Mr. Freud in 1893. It has a frontage of about 750 feet on Woodward avenue. The highway was originally the Saginaw Turnpike, and its location and width were established by the legislature. Act No. 107, Sess. Laws 1857. The width of the road was to be four rods, — two rods on each side of the center of the then existing plank road.
-‘As early as 1867, the Granger families owned and occupied both the Freud and Candler properties. - In that year they improved both places, and before the year 1870 there had been planted along the front line of both properties shade trees,, outside of which had been built a fence marking the line of the highway as to both properties. Within the fence on the Candler place, and not far from the house, was sunk a well, which remained until it was destroyed by defendant, in May, 1900. * * * Along the front of complainants’ property, the highway (that is, the space between the fences on either side) was nearly, if not quite, 66 feet in width; the graveled part of the plank road being about in the center of the highway as thus defined. The line of the fences was not in all places on a straight line, and the graveled road meandered slightly, but their lines were substantially as above stated.
“In January, 1895, the township of Eoyal Oak, in which all of the property mentioned is situated, gave a franchise for the construction of an .electric street railway along Woodward and other thoroughfares to George Hendrie, Fred A. Baker, Stephen Baldwin, John C. Donnelly, and Strathearn Hendrie. On October 21,1895, the Detroit & Birmingham Plank-Eoad Company granted permission to the Oakland Railway Company to occupy the highway for the construction of a single-track electric railway along Woodward avenue, under conditions set forth in the' contract. In pursuance of these contracts, the Oakland Railway Company, during the years 1895 and 1896, constructed a single-track electric railway from Detroit to Birmingham and Pontiac; the track being laid in the highway on Woodward avenue between the traveled part of the plank road and the fences which had marked the line of the complainants’ two properties for many years. In the construction of this single track, and the operation of it, none of the trees were removed from the front of either of the properties, nor were the fences disturbed, unless possibly at the upper end of Freud’s land the fence which had stood outside of the trees was then placed immediately to the west, and behind the trees; also some of the trees at the upper end of Mr. Freud’s property had some of their limbs cut off by the railway company, so as not to interfere with the poles and wires used in the construction and operation of the plant.
“On March 21, 1899, the Oakland Railway Company secured the privilege from the Detroit & Birmingham Plank-Road Company for the construction of a double-track where previously it had maintained only a single-track railway. Previous thereto, the railway company had purchased fapm Mr. Porter, who adjoined complainants on the north, a strip of land one rod wide along the front of his property, and immediately north of Freud’s land. During 1899 the railway .company constructed a double-track railway from Royal Oak southerly to the northerly line of Freud’s property; building the tracks in such a way as to protect the line of trees which had previously marked the front of Mr. Porter’s land.
“The defendant, the Detroit & Pontiac Railway Company, succeeded to any rights which the Oakland Railway Company had in the railway, in 1897 or 1898. Previous to May 1, 1900, at which time defendant began the destruction of the trees in front of both properties, and the removal of the fences thereon, no request for permission to appropriate their property and no negotiations of any kind were had by defendant, or by any one on its behalf, with any of the Candlers. As to Mr. Freud’s property, there had likewise been no negotiations of any kind, except with a Mr. Springsteen, who, claiming to represent defendant, saw Mr. Freud, and made an offer to pay him for the privilege of constructing the double track. Mr. Freud refused to sell his property for the amount which Springsteen proposed, viz., $1,000, and told him he preferred to have the railway laid in the center of the road; Mr. Springsteen having suggested that Mr. Hendrie owned a controlling interest in the graveled road, and could do so.
“ Without further warning, defendant’s men, under the personal instruction of its manager, entered upon the complainants’ properties with a large force of men; moved the fences back a distance of substantially seven feet along the line of botn properties; cut down all of the trees, which had stood along this line for 30 years or thereabouts; filled in the well on the Candler property; graded the entire front, utterly regardless of the slope of the land on the adjoining properties, or of the grade of the plank road; and constructed upon this property a double-track railway, built substantially as commercial railways are constructed, placing trolley poles immediately against the fence in its new location, and having the ties and the rails of the inner track, throughout a large part, if not all, of the length of the properties, on the land which had previously been included within the fences of complainants.
“ Complainant Freud immediately applied to the Oakland circuit court for an injunction restraining these trespasses; his original bill being filed on May 2, 1900. The circuit judge .refused to grant an ex parte injunction, except to. restrain the defendant from cutting trees. As the trees had already been cut down, the injunction was of no use whatever to complainant. Upon a hearing after notice, the circuit judge refused to grant any preliminary injunction. Since defendant continued its trespasses, and was apparently appropriating complainants’ land by building its railway in defiance of complainants’ rights, complainants, on May 10, 1900, served written notice upon defendant that they intended severally to prosecute their suits to a conclusion, that defendant should cease its trespasses, and that any expense incurred by defendant in placing its track as proposed would be done at defendant’s risk. On May 7, 1900, Mr. Freud filed his amended bill of complaint, and the Oandlers at the same time filed their original bill of complaint. Before answer in either cause, and on May 16,1900, amendments were filed, setting forth further objections to defendant’s appropriation of complainants’ property. The defendant answered the bill in each case. The defendant continued the construction of its railway, and at the time of the hearing, in the fall of 1901, it had constructed a double electric-railway track along and upon the front of these properties.”

The action of defendant is wholly.outside the law. The complainants moved promptly, and attempted to prevent the unlawful cutting down of the trees and the encroachment made upon their properties.’ If the defendant may forcibly take possession of a strip of land seven feet wide belonging to complainants, because it thinks it needs it, it has the right to take any quantity of their land. If the defendant is organized under a law which authorizes it to exercise the right of eminent domain, if it could not agree with the owners of the land, it was its duty to do so before entering upon the land. If it is not authorized to invoke the law of eminent domain, and cannot agree with complainants upon a purchase of the land, it was not justified in taking it by force. It does not, by reason of being a corporation, occupy any different relation than an individual in that respect. The principles involved are so fully discussed, and the authorities collected, in recent cases decided by this court, that we deem it unnecessary to more than call attention to them. Nichols v. Railway Co., 87 Mich. 361 (49 N. W. 538, 16 L. R. A. 371); Kennedy v. Railway, 108 Mich. 390 (66 N. W. 495); Stock v. Township of Jefferson, 114 Mich. 357 (72 N. W. 132, 38 L. R. A. 355); Donovan v. Allert, 11 N. Dak. 289 (91 N. W. 441, 58 L. R. A. 775).

An important question presented by the record is whether defendant has any right to maintain any part of its track within eight feet of the line of the highway in front of the property of complainants. Section 4097, 2 Comp. Laws, provides, among other things, as follows:

Provided, that no earth shall be dug, plowed, or scraped nearer than within eight feet of the margin of the highway, without the consent of the owner of the premises adjacent thereto.”

This law was passed in 1885. Act No. 160, Pub. Acts 1885. It is claimed by defendant that it was passed at a time when electric roads were unknown; that, as a rule, they cannot be constructed without encroaching upon the prohibited space; and that the uses to which highways are now put are contrary to the spirit of the statute, and it should not be enforced. If counsel are right, their argument is one which should be addressed to the legislature, rather than the judicial branch of the government.

It is also claimed the law of 1885 is amended, by implication, by the statute whose provisions are contained in sections 6470, 6471, 2 Comp. Laws. This statute undertakes to confer upon electric roads a method of acquiring the right to use a portion of the highways controlled by plank-road companies; but it is expressly provided therein “ that the provisions of this act shall not be so construed as to affect the rights of abutting property owners or the rights of-the public in such highways.” We think it clear the legislature did not intend by this statute to amend the law of 1885, and that the railway company had no right to construct any portion of its road nearer than eight feet of the street line without the consent of the abutting proprietor.

It is suggested that as the limitation to the removal of earth within eight feet of the margin of the highway is found in a chapter headed, “The Performance of Labor on Highways, and the Commutation Therefor,” the provision is a mere limitation on the right of the overseer of highways to enter upon'the eight-foot strip in building or improving the public highway, and that it does not limit the power of the township board to grant this right to a street-railway company. Section 1, art. 11, of the State Constitution, provides for the election of commissioners of highways and overseers of highways, whose powers and duties shall be prescribed by law. We cannot see any more appropriate place, when laws are to be enacted relating to the use of highways, and the character of the improvements thereon, than to place these provisions in the chapter the heading of which has been quoted. When the legislature undertook to confer upon the township board the right to grant to a street-railway company the right to run its road in and along the highways of the township, in the absence of anything to indicate to the contrary, it may safely be presumed the legislature had in mind the limitations and provisos in the statute which had been placed there in the interest of the owner of the land, and did not intend to do away with them, and, by. the use of the term “highway,” referred to such a highway as the laws of the State provided for.

What we have said as to the power conferred by the legislature upon the township board will apply equally to' plank-road companies. The needs of such a company are simply for such a portion of the highway as will provide for a roadbed 16 feet wide. The highway continues to be a public highway, though a corporation is authorized to make a plank or gravel road thereon and charge toll. Should the term of the charter end, or it become forfeited, the highway would become at once a normal highway. There is nothing in the needs of the plank road, or in the statute authorizing its construction, which indicates the. legislature did not intend the proviso in relation to the eight-foot strip to apply to highways of this character.

The decree of the court below should be reversed, and one entered here perpetually enjoining the defendant from trespassing on the property of complainants, and requiring it to.remove all portions of its track and ties eight feet easterly of where the highway fence was before it was removed. The case should also be remanded for the purpose of enabling proofs to be taken for the purpose of ascertaining how much damage has been sustained by complainants, after said railway track has been removed as above required, by reason of the unlawful acts of defendant. The complainants should recover costs of both courts.

Montgomery, J., concurred with Moore, J.

Carpenter, J.

We fully concur in the opinion of our Brother Moore that complainants are entitled to an injunction compelling defendant to remove its track, and that they are entitled to compensation for the damage done them. We cannot, however, assent to the proposition that the provision of section 4097, 2 Comp. Laws, quoted in said opinion, prohibits the construction of a street railway within eight feet of the margin of the highway. That provision is found in the chapter headed, ‘ ‘ The Performance of Labor on Highways, and the Commutation Therefor.” The section in which it is found (viz., section 4097, 2 Comp. Laws) reads:

“All road work hereafter done upon roads that have been opened and worked for ten yea.rs or more, except such •as may be required for necessary repairs, shall have in view the permanent improvement of such roads by graveling .and turnpiking. Elevations upon the line of such roads shall b,e cut down, and the depressions raised, in order to form a grade as level as the nature of the ground will permit. Any surplus earth or gravel, taken from one portion of the road, may, with the consent, of the highway commissioner, be used to fill such depressions in any other road in the same district: Provided, that no earth shall be dug, plowed, or scraped nearer than within eight feet of the margin of the highway, without the consent of the owner of the premises adjacent thereto. Such roads shall be worked so as to form a turnpike sufficiently crowning to turn the water, with gutters adequate for drainage, and the width of the turnpike shall be not less than ten feet on each side of the center line of the road, terminating in the center of the gutter. Any person may, under the direction of the overseer of highways; be allowed to remove snow from the traveled highway, to haul gravel or other material for the repair of roads, at any time during the year, and a receipt for the work so done shall apply on his next assessment of highway labor. ”

It seems to follow that the proviso in question is a mere limitation on the right of the overseer of highways to enter upon this eight-foot strip in building or improving the public highway. The overseer of highways is not given the power to -determine the location in a highway of the tracks of a street-railway company. The township board, by virtue of section 6446, 2 Comp. Laws, would seem to have that power. See Nieman v. Railway Co., 103 Mich. 256 (61 N. W. 519); Township of Springwells v. Railway, 122 Mich. 486 (81 N. W. 336). We think it clear that this power of the township board is not limited by a statute which applies only to the overseer of highways in building or improving the highway. We do not think this court can determine whether the track of the street-railway company should or should not be located on the eight-foot strip in question. We do think that we have no power to say that it should not be located there, if the township board determines that it should.

The decree should be as suggested in the opinion of Justice Moore, except that it should not require defendant to remove its track and ties eight feet easterly of where the highway fence was before it was removed.

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


author: Hooker, C. J.

text:
    BRADY v. KLEIN.
    1. Landlord and Tenant — Defective Premises — Personal Injuries — Covenant to Repair — Liability of Landlord.
    A landlord, is not liable to a licensee of his tenant, injured through the defective condition of the premises, by reason of the nonperformance of a covenant to repair.
    2. Same — Nuisance.
    One who lets premises in a defective condition is not liable to a stranger injured by the defect, unless it amounts to a public nuisance.
    3. Same.

      Thus: A landlord of a dwelling is not liable to his tenant’s child for injuries received by stepping into a hole in a door-sill, though he had agreed with the tenant to repair the defect.
    Error to Wayne; Donovan, J.
    Submitted January 9, 1903.
    (Docket No. 20.)
    Decided June 23, 1903.
    Case by Thomas B. Brady, by next friend, against Sevilla Klein, for personal injuries. From a judgment for defendant on verdict directed by the court, plaintiff brings error.
    Affirmed.

      Frederic T. Harwárd and Delbert J. Hinkley, for appellant.

      George Gartner, for appellee.
   Hooker, C. J.

The plaintiff is a young man about 20 years old, and this action is brought by his mother and next friend to recover damages occasioned by an injury received through the alleged negligence of the defendant when he was under three years of age.

The mother is the only witness by whom the injury and alleged negligence were proved. She stated upon the trial that she had negotiations with the defendant in regard to renting a dwelling, and was allowed to look at the house. She returned and told defendant that it was all right, except that the sill of the door to the summer kitchen was rotted away, leaving a hole, and that, upon the defendant’s promise to fix it, she rented the house and paid a month’s rent. ' Two or three weeks after, the plaintiff stepped into the hole and received a permanent injury. She admits that she paid the rent for two or three months, and then failed to do so, and that she did not say anything to the defendant about the injury to the child until she called for her rent and told her to vacate the house. She never mentioned it again. The defendant is an old lady of over 80 years of age. She testified that she heard of the accident from plaintiff’s mother about the time it happened, and was told by her that the boy was hurt by a fall in the yard; that she never heard of this claim until the action was begun, a few months before she testified.. The learned circuit judge directed a verdict for the defendant, and plaintiff has taken a writ of error.

The plaintiff’s claim is said to rest upon two rules, either of which is supposed to be sufficient, to entitle him to a recovery:

1. That, when a landlord has covenanted to repair, a licensee of the tenant, injured through the defective condition of the premises, has a right of action against the tenant, who in turn may recover against the landlord upon his covenant, and that, to avoid circuity of action, he may sue and recover against the landlord.
2. That, when one lets a tenement in a defective condition, he is liable to a stranger who is injured.

So far as the authorities cited by counsel show, the first proposition was first enunciated in the case of Payne v. Rogers, 2 H. Bl. 349. This injury was caused by plaintiff’s falling through a hole in a foot pavement, and we may therefore infer that the defect was a public nuisance, and, under many cases, actionable, in favor of any one injured, against the person whose negligence permitted it to remain. What was then said about avoiding circuity of action was unnecessary in that view of the case, and the case has been questioned by subsequent English cases. See Russell v. Shenton, 3 Q. B. (N. S.) 449; Todd v. Flight, 9 C. B. (N. S.) 377; Ingwersen v. Rankin, 47 N. J. Law, 18 (54 Am. Rep. 109); Phillips v. Library Co., 55 N. J. Law, 307 (27 Atl. 478); Clyne v. Helmes, 61 N. J. Law, 366 (39 Atl. 767). See, also, Pretty v. Bickmore, L. R. 8 C. P. 401; Gwinnell v. Eamer, L. R. 10 C. P. 658. Nelson v. Brewery Co., L. R. 2 C. P. Div, 313, was a similar case, where a guest in the yard of an inn was injured by the fall of a chimney which the landlord had agreed to repair. He was permitted to recover against the landlord, but it was not upon the ground of a promise, but because of his neglect in permitting the existence of a public nuisance. The case of City of Lowell v. Spaulding, 4 Cush. 277 (50 Am. Dec. 775), is similar. There one fell through a walk, and recovered against the city, and it sued the owner of the premises, who was held responsible for the existence of a public nuisance. There is an allusion to Payne v. Rogers, but it was unnecessary. Sontag v. O’Hare, 73 Ill. App. 432, allowed a recovery by an administrator for injury by deceased’s falling from a porch through a defective railing. The only question pressed in the case was that the evidence failed to show that the injuries caused the death, though it is said in the opinion that the landlord’s promise to deceased’s husband to keep the premises in repair would make him liable if the injuries caused her death; citing Mendel v. Fink, 8 Ill. App. 378; Platt v. Farney, 16 Ill. App. 216. We think these cases hardly justify the statement. The case of Clancy v. Byrne, 56 N. Y. 129 (15 Am. Rep. 391), was an injury from a defect in a pier leased by the defendant, which was devoted to use by the general public, much as is an inn. Clearly it was a case of public nuisance. Our own case of Fisher v. Thirkell, 21 Mich. 14 (4 Am. Rep. 422), was the case of a scuttle in the sidewalk of a public street. The discussion in that case shows that a liability, had one been found, would have rested on negligence, i. e., nonperformance of a duty to the plaintiff, and not upon a contract to repair, though in many of the cases the contract to repair is essential to create the duty, which would otherwise rest solely upon the tenant.

In support of the second proposition, the plaintiff’s counsel cite, among other cases, Swords v. Edgar, 59 N. Y. 28 (17 Am. Rep. 295). There it was held that one who owned a public pier, and rented it with a public nuisance upon it, was liable to a third person who was afterwards injured, although the tenant was bound to keep it in repair. Three judges dissented. The case of Owings v. Jones, 9 Md. 108, sustains the same rule as to a public nuisance. Albert v. State, 66 Md. 325 (7 Atl. 697, 59 Am. Rep. 159), also involved a public nuisance. The discussion in the opinion shows that the rule is limited to cases of public nuisance. The case of Willcox v. Hines, 100 Tenn. 538 (46 S. W. 297, 41 L. R. A. 278, 66 Am. St. Rep. 770), rests on another rule, viz., the liability of one to his tenant for letting premises with concealed dangers. This line of cases has no application in this case. The cases of Stillwell’s Adm’r v. Land Co., (Ky.) 58 S. W. 696, 52 L. R. A. 325, and Moore v. Steljes, 69 Fed. 519, more nearly support the plaintiff’s claim.

Upon the other hand, when the accident arises from a defect known by the tenant, arid one which is not a nuisanee, the remedy against the landlord is upon his covenant, and must be brought by the tenant, as there is noprivity between the landlord and a third party, nor does he owe him any duty. It is otherwise in case of a nuisance which the landlord should abate, for there the landlord owes the duty of care, and is liable for his negligence to all to whom he owes such duty. Samuelson v. Mining Co., 49 Mich. 164 (13 N. W. 499, 43 Am. Rep. 456); O’Leary v. Delaney, 63 Me. 585; Dalay v. Savage, 145 Mass. 38 (12 N. E. 841, 1 Am. St. Rep. 429); Tuttle v. Manufacturing Co., 145 Mass. 175 (13 N. E. 465); Quay v. Lucas, 25 Mo. App. 7; Burdick v. Cheadle, 26 Ohio St. 393 (20 Am. Rep. 767); 2 Wood, Land. & T. p. 1288; Sterger v. Van Sicklen, 132 N. Y. 499 (30 N. E. 987, 16 L. R. A. 640, 28 Am. St. Rep. 594); Clyne v. Helmes, 61 N. J. Law, 359 (39 Atl. 767); Fowles v. Briggs, 116 Mich. 425 (74 N. W. 1046, 40 L. R. A. 528, 72 Am. St. Rep. 537). In these cases the distinctions are fully discussed, and need not be repeated here. Most of the cases upon which plaintiff relies are not inconsistent with them. The statement that a landlord is liable to a third person, when he has promised to repair, is made, in a general way, in some of the text-books, but will be found to be qualified in most cases, and when it is unqualified is clearly at variance with authority.

The judgment is affirmed.

Moore, Grant, and Montgomery, JJ., concurred. Carpenter, J., did not sit.