author: BROOKE, J. Bird, J.

text:
    WISNIEWSKI v. DETROIT, GRAND HAVEN & MILWAUKEE RAILWAY CO.
    Railroads — Negligence—Crossing Accident.
    Evidence tending to show that decedent was crushed between two sections of a freight train which defendant’s employees were coupling together on a street crossing in the night, that there was an open space between the standing and moving cars, through which decedent attempted to pass, and no lights were displayed at the end of the moving .cars, that no trainmen were stationed at the crossing, and signals were not sounded, held, to raise an issue of fact for the jury upon the contributory negligence of deceased, since there were no eyewitnesses of the killing and decedent is presumed to have exercised ordinary care. McAlvay and Brooke, JJ., dissenting. ' .
    Error to Wayne; Van Zile, J.
    Submitted June 4, 1913.
    (Docket No. 28.)
    Decided November 3, 1913.
    Case by Frances Wisniewski, administratrix of the estate of Ignatz Wisniewski, against the Detroit, Grand Haven & Milwaukee Railway Company for the negligent killing of plaintiff’s decedent. Judgment for defendant upon a directed verdict. Plaintiff brings error.
    Reversed.

      Dohany & Dohany, for appellant.

      Geer & Williams, for appellee.
    Plaintiff, as administratrix, sues defendant for damages arising out of the alleged negligent killing of her intestate. Plaintiff’s intestate, on the night of his death, had attended a “smoker” given by the lodge of which he was a member. The lodge room was located on Riopelle street between Willis and Canfield avenues. He resided on Dubois street between Garfield and Forest avenues. He was killed on defendant’s tracks where they cross Warren avenue omDequindre street. This point is two blocks west and two blocks north of his home.
    The lodge room is located four blocks west and two blocks south of his home. He left the lodge room about 1 o’clock a. m. and his body was found beneath a freight car at 1:55 a. m. His feet were towards the east, the trunk of the body towards the west. His head, which had been severed from his body, was lying just west of the westerly rail of the track upon which he was killed. What he did or where he went after leaving the lodge room is unknown. As no witness saw the accident, it does not appear from which direction decedent approached the crossing. Between Hancock avenue on the south and Frederick street on the north, defendant maintains what is known as the “Farnsworth yard.”
    Crossing Warren avenue, there are ten tracks. Counting from west to east, Wilson’s siding is the sixth track. It was upon this track that decedent met his death. The record discloses that it is customary for defendant to conduct switching operations in and about this yard during each night; there being many manufacturing institutions in the vicinity. The movements of the switching crew, as detailed by defendant’s witnesses, just prior to the happening of the accident, were as follows: The switch engine moved north from Hancock, on the Wilson siding, and there coupled to a “drag” of 15 or 20 cars. It then moved south and “kicked” some cars from the north end of the “drag” into a track east of Wilson’s siding. It then went south again and “kicked” seven cars north into Wilson’s siding. Upon this operation defendant’s witness, Squires, carrying a white light, rode upon the northerly car as they drifted north. According to his testimony, these seven cars stopped directly across Warren avenue; two or three of them being south of the south crosswalk. The engine then went south and “kicked” two or three more cars into an easterly track and then, with two or three cars attached, moved north on Wilson’s siding to coupl'e onto the seven cars standing across Warren avenue. Squires had walked along the west side of these seven cars and was at the south end awaiting the approaching engine to make the coupling. After the impact, the cars were pushed north about a car length, when Squires’ attention was attracted by some one shouting at Warren avenue that a man had been killed. The train was stopped and an examination discovered decedent’s body, lying, as described, a few feet north of the southerly sidewalk on Warren avenue. The evidence conclusively established the fact that the switching engine, in the course of these operations, was equipped with an automatic bell which was ringing all the time.
    It is likewise established that a pedestrian, when approaching Wilson’s siding from the west, would have an unobstructed view to the south, beyond Hancock avenue, when 40 feet distant, and if approaching from the east a like unobstructed view at a much greater distance from Wilson’s siding. An electric light hangs in the middle of Warren avenue, 60 feet west of Wilson’s siding.
    It was the theory of the plaintiff that.decedent had approached the crossing from the west; that defendant, in placing the seven cars across Warren avenue, had cut them, leaving an open space at the south sidewalk; that decedent noticed this opening and attempted to pass through, when the cars to the south were pushed against him, throwing him to the ground and running over him. The only evidence in the record tending to support this theory is that of plaintiff’s witness Monarch, who testified in part as follows :

      “A. As I walked along Dequindre street I passed and I was between the fire tower and the engine room and I heard a noise and when I heard that voice I looked around and I heard a crash of cars and when I got to the— The crash came right after I heard some one holler. * * *

      “Q. Now was there any light on the cars that was standing still, or on the end of the car that crashed into the cars that were standing still?

      “A. No, sir; there was not.

      “Q. Were there any trainmen where these two cars came together at the time they came together?

      “A. No, sir; there was not.”
    The learned circuit judge assumed this testimony to be true but directed a verdict for defendant upon the ground that plaintiff’s decedent was guilty of contributory negligence as a matter of law. He said in part:
    “Suppose we accept as true, for the sake of argument, and the defendant disputes it by several witnesses, but suppose we accept it as true, and we would have to accept it as true at this stage of the case; that is, the witness Mark testified an opening was left between the cars as they stood there on Warren avenue so that persons could pass through who desired to cross at the point, and the deceased, according to the theory of plaintiff’s counsel, undertook to pass through and was struck by the car or cars of the defendant, set in motion by the defendant’s servants. Now, conceding that to be true, and suppose we go further a,nd concede that there was negligence on the part of the defendant even in handling those cars, and that the negligence of the defendant resulted in the accident. Now, while I don’t believe the proofs warrant this finding, but I am supposing this to be so for the sake of this illustration and for the sake of the case, then can it be said that the second requirement is made out, namely, that the negligence of the deceased did not contribute to this accident? It is claimed by counsel for the plaintiff that this, under the circumstances of this case, must be presumed, that he was not negligent, because he was killed and no one saw him killed, and that the presumption is that he was exercising that diligence that an ordinarily prudent man would exercise in protecting himself, and that is a presumption of the law where there is no testimony upon that subject on account of the death of the person who was injured; it is presumed that the man would exercise that reasonable care and prudence which would be exercised by a reasonably prudent man in taking care of himself. But this is, a presumption of the law, and we are to presume for example, carrying that farther, we are to presume for example, that he exercised the care and the prudence of an ordinarily cautious person, that he looked, and that he listened for the approach of cars or trains, and that he did all that an ordinarily prudent man would do to protect himself. Now that is a presumption; but a presumption may always be overthrown by proof and so, if there is proof in this case that would or should overcome such a presumption, the plaintiff cannot have the benefit of it. In this case no one saw the deceased as he stepped between the cars; no one saw him meet his death. But the situation of the tracks is undisputed and what he must have discovered if he had looked and listened and been ordinarily cautious as he was bound to be. The car that struck him, according to the theory of the plaintiff, was on Wilson’s siding. To go to the place where it was and where he was struck, he would have to walk on defendant’s tracks some 40 feet; he would have to cross the Allison siding and the .two main tracks before he would arrive at the Wilson siding, a distance of something like 40 feet; and while traversing this distance, according to the proofs, he had a clear vision down the track for a long distance, a distance at least as far beyond where the defendant’s engine and cars were at work and where these cars and this engine were approaching on the Wilson siding. The bell on the engine was ringing. An arc light and electric light was burning 60 feet from the cars on the Wilson siding, or about that distance, on the side of the track on which he approached. So that it may be said here as an undisputed fact, I take it, that he could have seen (that an ordinarily prudent and cautious man could have seen), and that he must have heard the engine and the cars approaching. Now, it is a dangerous situation; the tracks themselves are to be considered, when one is crossing them, as being a place of danger when cars are running over them. It was a dangerous situation and a reasonably cautious man must be held to have understood it to be so. With such like surroundings, it cannot be presumed that the deceased was acting with caution; that is, with the caution that an ordinarily prudent man would act, being in a position where he could have seen and should have seen, where he could have heard and should hear, being upon these tracks and the lights being as they were, walking the distance that he did, an ordinarily cautious man could have seen and could have avoided the accident. Had he proceeded with care, looking and listening, he would not have been injured, and so we conclude that he was guilty of contributory negligence; that the proofs here show that he was guilty of contributory negligence. Therefore there can be no recovery and your verdict must be for the defendant, and you will so find.”

       On the question of contributory negligence in attempting to cross in front of engine or cars standing near street crossing,-see note in 11 L. R. A. (N. S.) 963. And as to contributory negligence in attempting to cross a train standing on a crossing, see notes in 13 L. R. A. (N. S.) 1066 and 34 L. R. A. (N. S.) 466.

   BROOKE, J.

(dissenting; after stating the facts). We are of opinion that the action of the court below was warranted by decisions of our own court. We pass the question raised by defendant that a verdict for plaintiff is not warranted because it must of necessity be based wholly upon conjecture; there having been no eyewitness of the tragedy. We likewise pass the question of defendant’s negligence. It may be said, however, in passing, that, if defendant operated its cars on the night in question as detailed by the witness Monarch, such operation would at least raise a question of fact as to defendant’s negligence.

Was plaintiff’s decedent guilty of negligence as a matter qf law? There having been no witness to his death, due care on his part is to be presumed. This presumption must take the case to the jury unless the undisputed evidence in the case clearly negatives the presumption. A railroad track is in and of itself, a warning of danger to one approaching it, and before attempting to cross it he is bound to make use of his senses to discover whether or not a train is approaching. Gardner v. Railroad Co., 97 Mich. 240 (56 N. W. 602), and cases cited.

In the case at bar, the defendant’s right of way across Warren avenue was covered with a network of ten tracks. Plaintiff’s decedent was a man 34 years of age and had lived in the vicinity for four years. There was an arc light in the middle of the street, 60 feet distant from the track upon which he was killed. It was a light night. Switching operations were being carried on by an engine, with a constantly ringing bell, somé three or four hundred feet away. These operations were in full view of decedent when he reached a point 40 feet distant from Wilson’s siding. .

In addition to the foregoing, it is undisputed that Witness Squires stood at the southerly end of the “drag” of cars, two or three car lengths south of the south sidewalk on Warren avenue, with a lighted-lantern with which he signaled, the switch engine to back up. It was at the time this coupling was made and the cars pushed north that decedent lost his life, according to all the testimony. Of course, if decedent attempted to go under or between the cars while they were coupled together and completely blocking the ■highway, he would be guilty of such negligence as would preclude his recovery. We think it would be negligence equally culpable for him to attempt to pass through the opening described by the witness Monarch, when Squires stood in plain view within 100 feet of him, signaling with a lantern, and an engine with its bell ringing approaching in plain view from the south. Gardner v. Railroad Co., supra; Brandy v. Railway Co., 107 Mich. 100 (64 N. W. 1056); Lau v. Railway Co., 120 Mich. 115 (79 N. W. 13); Tucker v. Railway Co., 122 Mich. 149 (80 N. W. 984), and cases cited.

Judgment should be affirmed.

McAlvay, J., concurred with Brooke, J.

Bird, J.

The conclusion of- Mr. Justice Brooke that the deceased was guilty of contributory negligence appears to me to be at variance with the testimony of the witness Monarch. ¡ He is the only witness who throws any light on the manner in which the deceased came to his death. He testified in part as follows:

“There are several Detroit, Grand Haven & Milwaukee tracks that cross Warren avenue and Dequindre street. As I walked towards Dequindre street, on the south side of Warren avenue, I -noticed cars on the tracks. I could see an opening right through. The open way was on the south side of Warren avenue. They were freight cars. This was after 1 o’clock. The section north was pretty close to the sidewalk; that is, they came pretty close to the north side of the sidewalk. The People’s Ice Company is on the south side of Warren avenue, right beyond Dequindre. As I walked along Dequindre street I passed and I was between the fire tower and the engine room and I heard a voice, and when I heard that voice I looked around and I heard a crash of cars and when I got to the— The crash came right after I heard some one holler. At that time I was on the sidewalk about 100 feet west from where these cars came together. After I heard this scream or holler and the cars came together, I walked out to the car and waited for it to pass, and I stood there about two seconds and I looked down and saw a body under the car — saw the body lying there. * * *
“Q. Now, was there any light on the cars that was standing still or on the end of the car that crashed into the cars that were standing still?
“A. No, sir; there was not.
“Q. Were there any trainmen where these two cars came together at the time they came together?
“A. No, sir; there was not.
“Q. Was any whistle blown before these cars came together ?
‘A. No, sir. * * *
“Q. Was the bell of the locomotive ringing?
“A. No, sir; I did not hear the bell ringing.”

A fair inference to be drawn from this testimony is that there was an opening between the cars on the south side of Warren avenue and that the deceased attempted to pass between and was knocked down and run over by them. If the cars were cut at the sidewalk, and there were no trainmen in the immediate vicinity, nor lights displayed, nor signals being given, which would indicate that the cars were about to be moved, the deceased was not guilty of contributory negligence, as a matter of law, in attempting to pass between them. In streets passing through railway yards it is not uncommon for cars to be left standing near the sidewalk; and, where there is nothing to indicate that they are being “switched,” pedestrians do not usually hesitate to pass between them.

The testimony of the witness, considered in connection with the rule that no presumption of negligence can be indulged against the deceased, persuades me that his negligence was a question for the jury and not for the court.

The judgment should be reversed and a new trial granted.

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


source: Caselaw Access Project

author: Kuhn, J.

license: Public Domain

text:
    FIDELITY & DEPOSIT CO. OF MARYLAND v. HIBBLER.
    1. Appeal and Error — Findings op Fact — Questions Reviewable.
    Unless there is no evidence to support a finding of fact made by the circuit court in trying a case without a jury, or unless the finding is contrary to the undisputed evidence, this court will not review it.
    2. Indemnity — Principal and Surety — Construction op Contract — Bond.
    Where plaintiff as surety executed a bond to secure the performance of a building contract, and the principal in the bond defaulted, the plaintiff, which paid the liability in good faith, was entitled to maintain an action against a third party who had agreed to indemnify the plaintiff corporation against any loss, although it had not availed itself as a defense of a clause in the bond requiring suit to be brought within six months after default, defendant’s agreement containing a clause that the surety company should be reimbursed for any and all sums paid by it in good faith under the belief that it was liable or that the expenditure was necessary or expedient.
    3. Same.
    A contract of indemnity is to be interpreted so as to cover any loss or liability which the parties reasonably appear to. have intended it to include, but not such as are expressly excluded or of such a character that it can reasonably be inferred that they were not intended to be within the agreement.
    Error to Wayne; Hally, J.
    Submitted June 5, 1918.
    (Docket No. 37.)
    Decided November 3, 1913.
    Assumpsit by the Fidelity & Deposit Company of Maryland against William H. Hibbler and Frank B. Hibbler for a loss sustained under an indemnity bond. Judgment for defendants. Plaintiff brings error.
    Reversed.

      Carey, Armstrong & Weadoek, for appellant.

      Bernard Goldman and A. B. Hall, for appellees.
   Kuhn, J.

The defendant William H. Hibbler, a building contractor in the city of Detroit, being required in the conduct of his business to furnish contractors’ bonds, made an arrangement with the plaintiff company to execute such bonds for him as surety, and if the company suffered loss it was to be reimbursed by him and Frank B. Hibbler, his brother. In February, 1906, the plaintiff executed a bond as surety for William H. Hibbler in favor of William H. J. McPharlin and wife, with whom Hibbler had made a building contract to build a double frame house to be completed by May 1, 1906. Hibbler defaulted on this contract, and suit was brought against him and the company on the bond. The cause was tried in the circuit court, and subsequently was carried to this court, the case being reported in 162 Mich. 141. It resulted in a judgment in favor of the McPharlins in the sum of $1,575.76, which was subsequently paid by the plaintiff company. This action was brought upon the indemnity agreement to recover the $1,575.76 and $165.71, disbursements for attorney’s fees and other expenses. William H. Hibbler defaulted in the proceedings below, and judgment in full was taken against him, and he does not appear in the present proceedings. The cause was tried before the court without a jury, and the court entered a verdict of no cause of action because it was claimed that Frank B. Hibbler was released from the indemnity agreement by reason of a waiver by the plaintiff company of a provision in the McPharlin bond which provided, that all suits thereon should be begun within six months after the first breach of the building contract.

Some controversy is had in the briefs of counsel as to when the first breach of the building contract occurred. The circuit judge, in’ his findings, determined it to be on May 1, 1906, the date fixed in the contract for the completion of the house. This finding will not be reviewed by this court. We cannot weigh the evidence nor determine the facts nor review the findings of the court below on questions of fact, unless there is a total want of evidence, or where the finding is contrary to the undisputed evidence. Cragin v. Gardner, 64 Mich. 399 (31 N. W. 206); Lamoreaux v. Creveling, 103 Mich. 501 (61 N. W. 783); Holcomb v. Sayers, 173 Mich. 238 (138 N. W. 1043). It is undisputed that the house was not completed on May 1, 1906, and the record shows no extension given beyond that time.

On' November 30, 1906, the plaintiff’s vice president wrote to the local representative of the company in Detroit:

“Gentlemen:
“I have your letter of the 27th inst., regarding the contract of Wm. H. Hibbler with the McPharlins.
“You are authorized to notify the latter that our company will not exercise the privilege reserved' in the bond to complete the same', and we shall expect them to have it completed at the lowest possible expense.
“A copy of your letter to the McPharlins should be sent to our underwriter, Frank B. Hibbler.”

When this letter was sent, more than six months had elapsed since the breach of the contract, and it is contended that the waiver of this condition by the company did not bind the underwriter Frank B. Hibbler, because his consent was not obtained. Whether this position is well taken does not become important, in view of the provisions of the indemnity agreement itself, given by the defendants to the plaintiff. This contained the following provisions:

“Second. The parties of the first part shall at all times indemnify, and keep indemnified, and save harmless the surety company from and against any and all loss, damages, costs and expenses of whatever nature or kind which it shall or may, at any time, sustain, incur, or be put to, for or by reason or in consequence of its having given and executed any such instrument or instruments on behalf of the contractor, including disbursements, costs and counsel or attorney’s fees incurred in collecting a premium or a loss sustained on any such instrument, and shall reimburse the surety company for any and all moneys, with legal interest thereon, advanced or loaned by it to the contractor for the purposes of any contract or contracts; and for all costs, counsel fees and expenses which it may incur in investigating any claim made thereunder, or investigating any application for advances or loans, or in prosecuting or defending any action, suit or other proceeding which may be commenced or prosecuted against the contractor, or against the surety company, upon any such instrument or instruments, or in any wise relating thereto. The parties of the first part further agree that in any accounting which may be had between them and the surety company, the surety company shall be entitled to charge for any and all disbursements in and about the matters herein contemplated made by it in good faith, under the belief that it is or was liable for the sums and amounts so disbursed, or that it was necessary or expedient to make such disbursements, whether or not such liability, necessity or expediency existed.
“It is understood and agreed, however, that the liabilities of the said parties of the first part shall not be changed or altered by reason of any modification made, either before or after execution by the parties thereto in any of the terms or conditions of any contract or contracts referred to in any instrument or instruments now or hereafter executed or procured by the surety company. * * *
“And the said parties of the first part hereby waive all notice of any default or defaults, or any other act or acts, giving rise to any claim under any such instrument or instruments given by the surety company on behalf of the contractor as aforesaid, or of any and all liability on the part of the parties of the first part, as well as notice of any and all liability of the surety company under any such instrument or instruments executed by it as surety, to the end and effect that the parties of the first part shall be and continue liable to the surety company hereunder, notwithstanding any notice of any kind to which the parties of the first might have been or be entitled, and notwithstanding any defense they might have been or be entitled to make. * * *
“And this agreement of indemnity, shall be liberally construed, so as to fully protect and indemnify the surety company.”

In construing contracts of this kind, the rule has been laid down as follows:

“A contract of indemnity should be construed so as to cover all losses, damages, or liabilities to which it reasonably appears to have been the intention of the parties that it should apply, but not to extend to losses, damages, or liabilities which are neither expressly within its terms nor of such character that it can reasonably be inferred that they were intended to be within the contract.” 16 Am. & Eng. Enc. Law (2d Ed.), p. 173.

Applying this rule of construction to this agreement, it seems to have been the intention of the parties to make an agreement which was to be an absolute undertaking by the defendants, the indemnitors, to reimburse the plaintiff, the indemnitee, for any loss sustained by it in connection with William H. Hibbler. There is no question but that the plaintiff acted in good faith. When its liability was established it paid its loss, and, under the agreement which the defendants made with it, it should now be reimbursed. The trial judge should have so found.

The judgment of the trial court is reversed, and a new trial granted.

Steere, C. J., and Moore, McAlvay, Brooke, Stone, Ostrander, and Bird, JJ., concurred.


text:
    FACE v. HALL.
    1. Fraud — "Value—Falsity—Opinion—Sales.
    The general rule that statements as to the value of property are mere matters of opinion and will not give rise to an action for fraud, is subject to the exception that false statements of the value of property intentionally made to one who is in ignorance of the quality and value, under such circumstances as indicate a purpose to induce the party to rely upon them, he having no opportunity to examine the subject-matter, may be treated as fraudulent.
    2. Same — Sales—Exchange — Concealment — Equity—Cancellation.
    Concealment of the fact that a grocery business had been unprofitable, in connection with false statements relative to the value of the stock of groceries and merchandise exchanged for other property, and with the false representation that the venture had been profitable up to a stated time, made by the seller, entitled the buyer to bring a suit in equity for cancellation based on the fraud, although he had full opportunity to inspect the Stock which he purchased.
    Appeal from Ingham; Collingwood, J.
    Submitted June 11, 1913.
    (Docket No. 75.)
    Decided November 3, 1913.
    Bill by Willard H. Face against Eugene H. Hall, Clarence M. Hall, and Blanche R. Mott for cancellation of an exchange of property. From a decree for complainant and in favor of defendant Mott, defendants Hall appeal.
    Affirmed.

      Samuel H. Rhoads (Cummins & Nichols,’ of counsel), for complainant Face.

      Elmer N. Peters, for defendants Hall.

      Ste%vart & Sabin, for defendant Mott.
   Kuhn, J.

The complainant, a resident of the city of Lansing, in February, 1912, desirous of acquiring a business in the city of Charlotte, through the medium of a Mr. Tolbert, a real estate man of the latter place, was introduced to the defendants Eugene H. Hall and Clarence M. Hall, who were the proprietors of a grocery store in that city. After some negotiations, the complainant purchased the property, consisting of a stock of merchandise and fixtures, and paid therefor $7,000. This sum was arrived at by placing a price of $3,500 on the stock of merchandise and $3,500 on the fixtures. The payment was made by complainant turning over to the Halls equities in certain real estate in Lansing at $3,000 and giving $4,000 in notes secured by a chattel mortgage on the stock of merchandise. The defendants- Eugene H. Hall and Clarence M. Hall, within a few days after giving up possession of the store, traded the chattel mortgage and notes which they had received from complainant to Frank Mott, acting as agent for his wife, Blanche R. Mott, one of the defendants herein, and received therefor certain real estate in the city of Battle Creek. The complainant, soon after taking possession, became suspicious that he had not received what he supposed he had purchased, had an inventory taken, and found that the stock inventoried at but $1,682.16. He thereupon filed his bill of complaint, alleging fraud and praying that his property be restored to him. The defendant Blanche R. Mott filed an answer and cross-bill, asking for affirmative relief, the restoration to her of her property. Answers were filed by the other defendants. The cause was heard, and thereafter a petition was filed to amend the bill of complaint to conform to certain proofs introduced on the hearing. The amendment was allowed, further proofs were taken, and a decree made granting the relief prayed for by the complainant and the defendant Blanche R. Mott.

The sole question in this case is whether fraudulent representations were made to the complainant and the defendant Blanche R. Mott by the Halls as to the amount of the stock of merchandise and as to whether the business was a profitable one or not, which were relied upon by them in making the trades.

It is strongly urged by counsel for the defendants Hall that the doctrine of caveat emptor applies; that the record discloses that the complainant was a man of considerable business experience, having been in the grocery business before; that he went over the stock several times and was satisfied with the price placed upon it by them, and no representations were made which were not in fact true and based upon their best information.

To determine the issue thus formed necessitates a careful study of the record. It is the claim of the complainant, and he so testified, that the defendants assured him that the stock would inventory at an invoice value of $3,500. The store in question had been purchased by the defendant Eugene H. Hall in April, 1911, and during the following 9 or 10 months several other people became interested in the business, but at the time of the sale to the complainant in February, 1912, the business was owned by the defendants Hall. It is also claimed that they represented to complainant that the business had been a profitable one up to some time in the fall of 1911, when they changed from a credit system to a cash system, which resulted in a loss of patronage. It appears conclusively, however, that the business was an unprofitable venture from the time the Halls took charge of it, and' they lost more than $3,000 during the 10 or 11 months they owned the business and were obliged to compromise with their creditors. Their excuse for not telling Mr. Face, the complainant, about it is stated by the defendant Clarence M. Hall, who testified that he did not think he had to tell him about it and claimed that the question was not asked of either him or his brother.

Mr. Tolbert, the agent, who was a witness for the defendants and who had been a partner for a short time in the firm of Hall Bros., a few months before the sale involved in this controversy took place, frankly stated that the business was losing money too fast to suit him, but when Mr. Face asked him about the business he did not tell him about his experience in the business but turned him over to the defendants Hall to give him the information.

It is claimed that in December, 1911, Frank Mott had a talk with the Halls and they represented to him that the stock and fixtures at that time were worth $8,000. At the time they traded the notes and chattel mortgage, Mr. Mott stated that they- told him that the value of the stock had not changed from what it was when they represented it to be worth $8,000 and told him that they had sold it to Mr. Face for $7,000.

It does not seem probable that, if defendants had told complainant the truth about their financial condition, their losses in the business, and the true value of the stock, he would have purchased the stock for the consideration he gave for it. If complainant’s testimony is to be believed, the conclusion must be arrived at that the defendants Hall deliberately and intentionally misrepresented the value of their stock and the condition of the business to him in order to make the trade, and these representations were the inducing cause of the trade.

In the case of Pinch v. Hotaling, 142 Mich. 521, 525 (106 N. W. 69, 70), Mr. Justice MONTGOMERY stated the rule concerning misrepresentations as to value, as follows:

“The contention made is that the statement of value was a mere matter of opinion, and cannot be made the basis of an action for fraud. This is a statement of the general rule, but the rule established by the weight of authority is that false statements of value intentipnally made to one who is in ignorance of the quality and value, under circumstances indicating a purpose that such statements are to be relied upon, and where the party to whom they are made has no opportunity to examine the property, may be treated as an affirmation of fact and fraudulent. See 14 Am. & Eng. Enc. Law (2d Ed.), p. 125; Simar v. Canaday, 53 N. Y. 298 [13 Am. Rep. 523]; Cressler v. Rees, 27 Neb. 515 [43 N. W. 363, 20 Am. St. Rep. 691]; Hedin v. Surgical Institute, 35 L. R. A. 427, note (62 Minn. 146 [64 N. W. 158, 54 Am. St. Rep. 628]); Collins v. Jackson, 54 Mich. 186 [19 N. W. 947]; Maxted v. Fowler, 94 Mich. 109 [53 N. W. 921]; 16 Cyc. p. 749.”

It is true that if all'that were relied upon in this case were simply the representations as to value, in view of the fact that complainant had an opportunity to examine the property and satisfy himself as to the values, it is doubtful if he could obtain the relief prayed for. However, his position is fortified by the representation that the business had been a profitable one, and there was no way for him to disprove it. The excuse made by one of the defendants Hall that he did not consider it necessary for him to tell, would under his own statement bring the case within the doctrine announced in Fred Macey Co. v. Macey, 143 Mich. 138, 153 (106 N. W. 722, 727, 5 L. R. A. [N. S.] 1036), in which case this court said:

“Fraud may be consummated by suppression of facts and of the truth, as well as by open false assertions. Fraudulent concealment is a matter of equitable jurisdiction as well as fraudulent assertion.”

We are satisfied from this record that a fraud has been perpetrated on the complainant and the defendant Blanche R. Mott, and the trial judge properly granted the relief prayed for.

The decree is affirmed, with costs to the complainant and the defendant Blanche R. Mott.

Steere, C. J., and Moore, McAlvay, Brooke, Stone, Ostrander, and Bird, JJ., concurred.


author: Moore, J.

text:
      In re JOHNSON’S ESTATE. WILLIAMS v. KNISKERN.
    1. Taxation — Special Assessments — Corner Lot — Municipal Corporations — Paving Tax.
    An improvement tax for paving may be assessed against a corner lot for work done on both, streets on wbicb it lies, since it is benefited by tbe pavement on either street.
    2. Covenants — Parol Evidence — Varying Deed by Oral Testimony.
    It is incompetent to sbow by parol, in an action on a vendor’s covenant against incumbrances, tbat tbe vendee agreed by parol to pay a tax wbicb bad become a lien On tbe property at tbe time of tbe conveyance.
    Error to Muskegon; Sullivan, J.
    Submitted June 11, 1918.
    (Docket No. 82.)
    Decided November 3, 1913.
    Albert L. Williams presented a claim against the estate of Anna Johnson, deceased, for breach of a covenant in a deed. From the allowance of the amount claimed, Philip W. Kniskern, administrator, appealed to the circuit court. Judgment for claimant. Defendant brings error.
    Affirmed.

      Philip W. Kniskern, for appellant.

      Cross, Vandenverp, Foote & Boss, for appellee.
   Moore, J.

The following is taken from the brief of counsel for appellant:

“September 28, 1905, Anna Johnson transferred the southerly 59 feet in width of lot 3, of block 20, Sanford’s addition to the village (now city) of Muskegon, which premises are also now known as the southerly or southeasterly 59 feet in width of lot 3, of block 239, according to the revised plat of the city of Muskegon April 9, 1903; said strip having a frontage of 59 feet on Ransom street, and extending same width in an easterly direction to the line between lot 3 and lot 5, of same block. This deed contained a warranty clause as follows:
“ ‘That at the time of the ensealing and delivery * * * she is well seized of the ahove-granted premises in fee simple; that they are free from all incumbrances whatever; and that she will, and her heirs, executors, and administrators shall, warrant and defend against all lawful claims whatever.’
“This deed was recorded September 29, 1905. The expressed consideration was $1,250. * * *
“At the time of the making of the deed there were certain unpaid back taxes. This controversy is as to who should pay them, the grantor or the grantee. The grantee has paid them, and has brought this proceeding against the estate of the grantor to recover back the amount of such payments. The grantor’s estate denies liability upon two grounds: (1) That the record does not show that these taxes were legally assessed against the land, or ever became a valid lien thereon. (2) That the grantee expressly agreed to pay these taxes as a part of the agreed consideration for the conveyance. The taxes involved were assessed against the premises in two improvement districts. * * *
“Resolutions were offered in evidence of the proceedings of the council May 8, 1902, reciting action of the council and board of assessors on the 8th day of May, 1902, considering objections that might be made to the special assessments of Delaware street improvement district No. 2, at which time it appears said roll was confirmed. * * * On the 19th of June, 1902, like proceedings were had with reference to the special assessment roll of Ransom street improvement district No. 2. * * *
“The record discloses the fact that the assessment rolls of both districts covered the 59 feet belonging to claimant on lot 3; that the assessment was by frontage. This lot was made to contribute to both improvements, notwithstanding there was a full lot and seven feet lying between this description and that one, which fronted on Delaware street. It was a separate property, with a house standing thereon, and its only connection with the other property was that the city assessor had assessed the three lots as one parcel. * * *
“The charter for the city of Muskegon provides that the council must determine by resolution the necessity for the proposed improvement:
“Title XI, section 1. The cost of the improvement to be assessed must not be over 25 per cent, of the last assessment on the premises abutting the street to be improved.
“Title XI, section 2. The assessment must be by benefits or by frontage.
“Title XI, section 5. Notice must be given appointing time and place for reviewing the assessment roll.
“Title XI, section 7. Council to require board of assessors to apportion the tax.
“Title XI, section 13. Local Act 102, approved March 19, 1901.
“There is no evidence in this case that any one of the foregoing provisions was complied with.
“While it may be the rule that between the State and the taxpayer the burden of proof is on the person disputing the legality of the tax, and holding the tax roll prima facie proof of the regularity of all the proceedings leading up to it, the reasons for the adoption of such rule does not apply as between the parties to a covenant in a deed for a title free of any lien” — citing cases, among them White v. Gibson, 146 Mich. 547 (109 N. W. 1049); Grand Haven Basket Factory v. City of Grand Haven, 174 Mich. 279 (140 N. W. 609); Van Zanten v. City of Grand Haven, 174 Mich. 282 (140 N. W. 471) — to which cases reference will be made later.

We again quote from the brief:

“Where only one of a tract of several lots owned by the same person abuts upon the street, an assessment can only be levied against the abutting lot, unless the whole tract is used by the owner in disregard of the lot lines. [Langlois v. Cameron] 201 Ill. 301 [66 N. E. 332; Smith v. City of Des Moines], 106 Iowa, 590 [76 N. W. 836; Barber Asphalt Paving Co. v. Peck], 186 Mo. 506 [85 S. W. 387; Wolfort v. City of St. Louis], 115 Mo. 139 [21 S. W. 912; City of Chester v. Eyre], 181 Pa. 642 [37 Atl. 837]. Property separated from a street by a strip of ground, no matter how narrow, cannot be assessed as frontage; [Crane v. French] 50 Mo. App. 367, holding that an unplotted piece of land cannot be assessed where it was separated from the street by a strip of land five feet in width. 28 Cyc. p. 1125.”

The following appears in the record:

“Alderman Reitdyk offers the following resolution, and moves its adoption:
“Whereas, this council and board of assessors did meet on the 8th day of May, 1902, for the purpose of reviewing and considering any objections that might be made to the special assessment on the lots and parcels of land contained in the special assessment district, known as Delaware street improvement, district No. 2; and, whereas, said roll was confirmed by the council and board of assessors as heretofore reported :
“ ‘Therefore be it resolved, that the said special assessment roll for the Delaware street improvement district No. 2 be and the same is hereby confirmed by the concurrence of two-thirds of all the aldermen elect, and the amounts assessed to the various parties be collected directly from the roll. And be it further resolved, that the amounts of said special assessment be divided into six equal installments payable as follows: The first installment is due and payable immediately upon the adoption of this resolution: the second installment is due and payable on the 8th day of May, A. D. 1903; the third Installment is due and payable on the 8th day of May, A. D. 1904; the fourth installment is due and payable on the 8th day of May, 1905; the fifth installment is due and payable on the 8th day of May, 1906; the sixth installment is due and payable on the 8th day of May, 1907. All deferred payments of installments shall draw interest from this date to the date of payment at the rate of five per cent, per annum, payable annually on the 8th day of May in each and every year until the same is fully paid.
“ ‘And be it further resolved, that the recorder be and he is hereby instructed to indorse a certificate on said roll to show the date of the confirmation thereof. Dated May 8, 1902.
“‘[Signed] Harry A. Reitdyk.
“Adopted by the following vote, viz.: Ayes — Aldermen Damm, Bomers, Hanson, Averill, Reitdyk, Monroe, Robinson, Sauer. Nays — None.”

A special assessment roll was offered in evidence, upon which appeared the following:

“On Delaware street improvement district No. 2 assessment against lots 1, 2, and 3, block 20, Sanford’s addition to the city of Muskegon, assessed to Anna Johnson, total assessment,' $200.10.
“The Court: Carried out in installments?
“A. Yes, sir.”
Then followed the installments.
“The certificate accompanying the same reads:
“ ‘State of Michigan, \
“ ‘City and County of Muskegon. \ ss-:
“ ‘We, the undersigned, appointed by resolution of the council of said city, adopted the 27th day of March, 1902, a board of assessors to levy a special assessment on the lots, pieces, and parcels of land in said resolution described and constituting the special assessment district designated Delaware improvement district No. 2, do hereby certify and return that in accordance with said resolution we have levied on the foregoing assessment roll the sum of $2,879.59 on the said lots, pieces, and parcels of land, and have assessed to each lot or parcel of land such relative portion of such sum as the length of such lot or parcel fronting on said improvement bears to the whole frontage of all the lots or parcels assessed; that we have entered and described on said roll all the lots, premises, and parts of lots in said resolution directed to be assessed, the valuation of each description, and the name or names of the persons chargeable with the assessments thereon.
“ ‘Dated Muskegon, Mich., May 1, 1902.
[Signed] “ ‘H. J. Hanson,
“ ‘Max Lange,
“ ‘C. S. Gamble,
“ ‘Board of Assessors for Delaware Street .
Improvement District No.. 2.
“‘State of Michigan, )
“ ‘County and City of Muskegon. [ ss-:
“ T do hereby certify that the council did, on "the 8th day of May, A. D. 1902, by a vote of two-thirds of all the aldermen elect, confirm the foregoing assessment roll, and did, by the resolution confirming said roll, provide for the payment of said assessment in six equal annual installments.
“ ‘Witness my hand this 9th day of May, A. D. 1902.
“ ‘P. P. Misner,
“ ‘Recorder of the City of Muskegon, Mich.
“ ‘State of Michigan, )
“ ‘The City and County of Muskegon. [ss-:
“ 'To the Treasurer of the City of Muskegon:
“ ‘You are hereby commanded to collect from each of the persons named in the foregoing assessment roll the first installment of the amount of money assessed, and set opposite his name therein, with annual interest at the rate of five per cent., and, in case any person named in said roll shall neglect or refuse to pay said first installment of the assessment on demand, then you are commanded to levy and collect the same by distress of the goods and chattels of such person, and to return the amount so collected to the credit of Delaware street special paving fund No. 2, and return said roll and warrant, together with your doings thereon, to the recorder of said city in sixty days from the date of this warrant.
“ ‘Given under my hand this 10th day of May, 1902.
“Theo. D. Morgan,
“ ‘Mayor of the City of Muskegon. ■
“ ‘State of Michigan, )
“ ‘County and City of Muskegon, j ss- :
“ T do hereby certify that I have compared the foregoing copy of the special assessment roll for Delaware street improvement district No. 2 with the original roll on file in my office, as confirmed by the council of said city, and that it is a true and correct copy of said original roll and of the whole thereof.
“ ‘Witness my hand and the official seal of said city this 10th day of May, 1902.
“ ‘P. P. Misner,
“ ‘Recorder of the City of Muskegon.
“‘[City Seal.]’
' “Witness: Lots 1, 2, and 3 of block 20, were assessed as one description. The fourth installment was not paid, and was reported delinquent October 23, 1905.”

Later these delinquent taxes were put upon the roll. Like proceedings were had as to the Ransom street assessment.

The charter of Muskegon provides, among other things, as follows:

Sections 9 and 10 of Title XI, read as follows:

“Sec. 9. When any special assessment shall be confirmed by the council, it shall be final and conclusive; but no such assessment shall be confirmed, except by the concurrence of two-thirds of all the aider-men elect.
“Sec. 10. All special assessments shall from the confirmation thereof, constitute a lien upon the respective lots or parcels of land assessed, and shall be a charge against the person to whom assessed until paid.”

Section 20 of title XI provides that the special assessment roll, and a certified copy of the order or resolution confirming the same, shall be prima facie evidence of the regularity of all the proceedings in making the assessment.

Section 12 of title X of said act reads as follows:

“Sec. 12. No general or special tax, special assessments or charges created, ordered or assessed in said city, upon any property therein, shall be held illegal or invalid, for any matter of form, in any matter not affecting the merits of the case, and which shall not injure or prejudice the rights of the party assessed; and all taxes and special assessments and charges created, ordered and assessed in said city shall be presumed to be legally assessed, until the contrary is affirmatively shown, and no such presumption shall be rebutted, or any sale, for taxes, special assessments and charges created, ordered or assessed in said city, be rendered invalid by showing that any paper, certificate, return or affidavit required to be made and filed in any office, is not to be found in the office where the same ought to be filed or found, but until the contrary is proved the presumption shall be, in all such cases, that such paper, certificate, return or affidavit was made and filed in the proper office.”

The circuit judge made the following findings of fact:

“(1) That the said Anna Johnson in her lifetime, and on, towit, September 23, 1905, and for a long time prior thereto, had been and was the owner of lots 1 and 3, of block 20, of Sanford’s addition to village, now city, of Muskegon, and said lots had been and were occupied as one parcel of real estate, upon which was situated a large brick apartment house, containing six flats; said building being upon practically all of said lots 1 and 2, and also extending upon and occupying the westerly seven feet of said lot 3, the frontage of said three lots, when considered as a whole, being 132 feet on Delaware street and 198 feet on Ransom street.
“(2) That prior to September 23, 1905, the city •of Muskegon, acting under and pursuant to the provisions of its charter, caused said .Delaware street to be paved, and caused the expense of said street improvement to be borne by special assessments upon lands fronting on and adjacent to the improvement. That a special assessment tax for the paving of said Delaware street was levied on said lots 1, 2, and 3, and 'became a lien thereon on May 8, 1902, and, under the provision of said charter of said city of Muskegon, continued to be a lien thereon until paid; the amount of said special assessment being divided into six installments, one of which should be collected each year.”

He made a like finding as to the Ransom street proceeding.

“That at the time of the aforesaid conveyance certain of the taxes for the special assessment for the paving of Delaware street, and also certain of the taxes for the special assessment for the paving of Ransom street, were then and there valid liens upon the said real estate so conveyed to the said Albert L. Williams by the said Anna Johnson, as aforesaid.”

He rendered a judgment in favor of the plaintiff for $144.12, the amount of taxes he paid.

We have already seen that the special assessment rolls and the confirmation of the assessments in due form appear in the record. It also appears that the trial judge found the property was occupied as an entirety, and there is no testimony to show that this was not true. The record does not disclose that Mrs. Johnson questioned the method of spreading these taxes. On the contrary, it is shown that she paid the various installments as they became due up to the time of the making of the deed in this case.

This record is entirely different from those in the cases cited by counsel which we have mentioned earlier in the opinion. The case seems to be within Nowlen v. City of Benton Harbor, 134 Mich. 401 (96 N. W. 450), where the three lots had a frontage of 150 feet on East Main street and of 165 feet on Wall street. In that case, one of the lots was sold before proceedings to pave were taken, and the other two lots were included as one parcel in the assessment districts for each street. Chief Justice HOOKER, speaking for the court, said:

“It is obvious that it is impracticable to limit a corner lot to one assessment district, except by the arbitrary method of dividing the lot by some sort of an imaginary line, having one terminus at the corner of the lot where the streets intersect and the other at such place as the council shall designate; and it is apparent that the entire premises used as a parcel fronting on both streets share in the benefit £o be derived from the use of the improvement upon either street, be it sewer, pavement, or any of the utilities, such as water or gas. When the benefits are apportioned by frontage, the total cost of the two improvements would fall upon the entire parcel, whichever method might be adopted, unless it be where there is such a disparity of cost that a levy of the assessments separately might exceed the statutory limit upon one parcel and fall below it on the other. We are of the opinion that it was competent for the council to say that this entire parcel was benefited by both improvements, and to assess it for each, provided it did not impose a greater burden than the statute permits, and it follows that the land may be in two assessing districts. We understand that the case of Boehme v. City of Monroe, 106 Mich. 401 (64 N. W. 204), does not hold to the contrary.”

See, also, City of Chester v. Eyre, 181 Pa. 642 (37 Atl. 837); Wolfort v. City of St. Louis, 115 Mo. 139 (21 S. W. 912); Goodrich v. City of Detroit, 123 Mich. 559 (82 N. W. 255).

2. Did the court err in shutting out testimony to the effect that Mr. Williams agreed to pay these taxes? Counsel say this was error; that you may always show what is the consideration for the giving of a deed — citing Mowrey v. Vandling, 9 Mich. 39; Breitenwischer v. Clough, 111 Mich. 6 (69 N. W. 88, 66 Am. St. Rep. 372); and many other cases. An examination of the cases shows the question arose where the consideration for the deed was involved, and not where a covenant in a deed was to be construed.

The case of Simanovich v. Wood, 145 Mass. 180 (13 N. E. 391), which was an action for breach of a covenant of warranty against incumbrances in a deed, the incumbrance consisting of an unpaid betterment assessment, would seem to be in point. In that case the court said:

“This is an action of contract on a covenant [of warranty] against incumbrances in a deed from the defendant to the plaintiff. It is admitted that an unpaid assessment upon the land was an incumbrance within the covenant. Carr v. Dooley, 119 Mass. 294. The defendant offered to prove, by parol testimony, that, at the time the deed was given, and as a part of the consideration, the plaintiff promised to pay said assessment.
“This evidence was rightly rejected. It directly varied and contradicted the written contract of the defendant. The covenant is against all incumbrances. The evidence offered was for the purpose of showing an oral agreement that the incumbrance created by the assessment was not within the covenant.
“While for some purposes it is competent to show what the real consideration of a deed is, a party cannot, under the guise of showing what the consideration is, prove an oral agreement, either antecedent to or contemporaneous with the deed, which will cut down or .vary the stipulations of his written covenant. This would violate the well-settled rule of law which will not permit a written contract to be varied or controlled by such testimony. Howe v. Walker, 4 Gray [Mass.], 318; Spurr v. Andrew, 6 Allen [Mass.], 420; Flynn v. Bourneuf, 143 Mass. 277 (9 N. E. 650, 58 Am. Rep. 135). Exceptions overruled.”

See, also, Hayes v. Livingston, 34 Mich. 384 (22 Am. Rep. 533); Dye v. Thompson, 126 Mich. 597 (85 N. W. 1113); Morrill v. Morrill, 138 Mich. 112 (101 N. W. 209, 110 Am. St. Rep. 306, 4 Am. & Eng. Ann. Cas. 1100); Longe v. Kinney, 171 Mich. 312 (137 N. W. 119).

Judgment is affirmed.

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


text:
    McMILLAN v. MILLER.
    1. Corporations — Accounting—Parties—Equity.
    In an accounting between stockholders of a corporation and its officers and directors, the corporation is a necessary party.
    2. Same — Officers and Directors — Management.
    Equity will not interfere with .the management of a corporation unless fraud or misconduct or some of the wrongful acts enumerated by 3 Comp. Laws, §§ 9757-9759 (5 How. Stat. [2d Ed.] § 13530), are set up by the bill.
    3. Same — Fraud—Officers and Directors.
    Averments . of complainant’s bill for an accounting that the board of directors voted to defendants as officers of a corporation salaries of ¡¡>100 a month, although when the complainants bought their stock defendants agreed not to receive any salary for their services, and averments that defendants had executed certain obligations of the corporation to their relatives, do not import fraud, in the absence of any charge of fraudulent intent.
    4. Same — Adequate Remedy at Law.
    For breach of the alleged contract, complainants have an adequate remedy at law.
    Appeal from Wayne; Hally, J.
    Submitted June 16, 1913.
    (Docket No. 99.)
    Decided November 3, 1913.
    Bill by Enos L. McMillan and Neil McMillan, Jr., against Theodore Miller and others. From an order sustaining defendants’ demurrer to the bill of. complaint, complainants appeal.
    Affirmed.

      Galloway & Graham, for complainants.

      G. Lewis Carter, for defendants.
   Kuhn, J.

The complainants and the defendants were all stockholders in a corporation known as the Miller Car Company. The bill of complaint was filed, as stated in complainants’ brief, to obtain an accounting from the defendants. The material allegations in the bill of complaint are that the defendants promoted the corporation; that two of the defendants were elected president and secretary and devoted but little time to the business; that the board of directors voted two of the defendants salaries of $100 per month; that the defendants sold their stock interest in the corporation; that complainants had no knowledge of what became of the receipts from the sale of the stock of the corporation; that the records of the corporation were turned over by the defendants in a mutilated and unintelligible condition to the complainants; that two of the defendants, while officers of the corporation, had executed certain' obligations of the company to certain persons, relatives of the defendants, “but for what purpose or reason the said obligations were so created complainants are not advised;” that certain of the defendants are claiming obligations of the company to be due and demand for payment has been made. It is also alleged that the complainants entered into a contract with the defendants to purchase stock in the corporation upon the consideration and understanding that the officers thereof should not be allowed to draw a salary, and that subsequently two of the defendants drew salaries at $100 per month. To this bill the defendants demurred for the following reasons:

“First. Because it appears by said bill that the complainants have no interest in the subject-matter of said bill of complaint which entitles them to maintain their said bill.
“Second. Because the transactions as alleged in said bill of complaint were between the defendants and a third party, the Miller Car Company, which is not a party to the said bill of complaint.
“Third. Because it appears by said bill of complaint that each of the complainants have adequate remedies at law.
“Fourth. Because it appears from the said bill that no act or transaction alleged in said bill was contrary to any right of the complainants or was in violation of any duty of the defendants, or either of them, to the complainants, and that the complainants suffered no wrong or injury by the defendants, or in consequence of any act or transaction set forth in said bill, of which a court of equity can take cognizance.
“Fifth. It appears by said bill that the complainants purchased stock in a certain corporation under certain representations and agreements constituting a contract by and with the defendants, which contract, it is alleged, was broken, and for which breach the complainants have a complete and adequate remedy at law.
“Sixth. Because it appears that said bill sets up two distinct matters and causes; that it sets up a contract between each of the complainants and the defendants, and also sets up certain transactions between the defendants and the Miller Car Company, a corporation; and that the bill is altogether multifarious.”

The trial court sustained the demurrer and in support of his action gave the following reason:

“The bill as drawn made the Miller Car Company a necessary party because no decree could be made for the payment of any money or the refunding of any money on the portion of the accounting which was also asked for unless the Miller Car Company were a party to the suit.”

Five days were given complainants to amend their bill só as to make the Miller Car Company a party defendant. This complainants failed to do, and the bill of complaint was dismissed. Was the circuit judge correct in sustaining the demurrer for the reason given? We think he was, as the case comes clearly within the ruling in the case of Coxe v. Hart, 53 Mich. 557, 558 (19 N. W. 183), upon which the trial judge relied. In that case this court said:

“So far as this defendant is concerned, the relief sought is for the benefit of the corporation, and if he releases or accounts, it must be to the corporation and not to the complainant, and in case he has any counter-equities those would also exist against the corporation. It is therefore an indispensable party, so far as he is concerned, and so far as all the defendants are concerned who are charged with defrauding it. Cicotte v. Anciaux, 53 Mich. 227 [18 N. W. 793].”

As this is a defect which could be rectified, and as the other reasons for demurrer state that the bill does not allege grounds for equitable relief, it is well to consider whether, if the Miller Car Company were made a party, the complainants would be entitled to any relief in this proceeding. Complainants say that the equity court has jurisdiction to give the relief prayed for by virtue of sections 9757-9759, 3 Comp. Laws (5 How. Stat. [2d Ed.] § 13530). A careful ex- ■ amination of the eight provisions of section 9757 shows, however, that the allegations of the bill do not come within any one of them. The bill does not charge that the defendants failed to account for the funds and property committed to their charge as officers of the corporation, or that the defendants have lost or wasted by violation of their duties any sums of money or property, or that they have acquired any of the property of the corporation to themselves, or that an officer should be suspended or removed for abusing his trust or because guilty of gross misconduct, or that there are any vacancies to fill, or that any alienation of property of the corporation has been or is about to be made by the officers, contrary to law. The complainants have no right to such an accounting as prayed for unless authority is conferred by statute.

In Cicotte v. Anciaux, 53 Mich. 227, 235 (18 N. W. 793), the court said:

“In the absence of a statute, it is well settled, and has always been recognized law, that courts of équity can never interfere with the action of such officers as have been placed by the corporation itself in the control of its affairs, unless either in excess of their discretion or in aggravated cases of misconduct amounting, to actual or constructive fraud.”

See, also, Aldrich v. Chair Co., 152 Mich. 369 (116 N. W. 461); Fuller v. McCormick, 156 Mich. 518 (121 N. W. 280).

If fraud were properly charged, the bill could be maintained under authority of Miner v. Ice Co., 93 Mich. 97 (53 N. W. 218, 17 L. R. A. 412), but in no portion of the bill of complaint is it charged that any act of the defendants complained of was done with a fraudulent intent. Fraud cannot be inferred from these acts, as they are proper and correct transactions and do not of themselves import fraud. Hale v. Chandler, 3 Mich. 531.

With reference to the claim of complainants that they contracted to purchase the stock in consideration that no salaries were to be paid the officers, it is clear that, if complainants’ claim is correct, they have an adequate remedy at law. As stated in defendants’ brief:

“The amount of those salaries paid out of the assets of the corporation has reduced the value of complainants’ stock in proportion to their holdings, and for the wrong alleged in the payment thereof complainants may recover their loss from the defendants at law.”

The order of the circuit judge sustaining the demurrer will be affirmed, with costs of both courts to defendants. The record will be remanded, and complainants will be allowed 20 days to amend their bill, if they desire so to do.

Steere, C. J., and Moore, McAlvay, Brooke, Stone, Ostrander, and Bird, JJ., concurred.


author: Bird, J.

text:
    KOLCHOWSKY v. DETROIT UNITED RAILWAY.
    Negligence — Contributory Negligence — Street Railways.
    In an action for personal injuries sustained by plaintiff in driving bis automobile across defendant’s tracks without observing a lighted car which collided with the motor car, evidence held, to warrant the trial court in directing a verdict for defendant. because of plaintiff's contributory negligence.
    Error to Wayne; Van Zile, J.
    Submitted June 16, 1918.
    (Docket No. 88.)
    Decided November 3, 1913.
    Case by Charles Kblchowsky against the Detroit United Railway for personal injuries. Judgment for defendant, and plaintiff brings error.
    Affirmed.

      Thomas J. Mahon and Thomas W. Thompson, for appellant.

      Corliss, Leete & Joslyn (William G. Fitzpatrick, of counsel), for appellee.
   Bird, J.

This cause was tried jointly with the case of Colborne v. Railway, ante, 139 (143 N. W. 32). In that case the right of the plaintiff to recover for her injuries was denied on the ground of the negligence of the driver of the automobile in which she was riding. Kolchowsky, the plaintiff in this case, was the driver of the automobile. He likewise brought suit to recover for his injuries, and on the same evidence the trial court directed a verdict for the defendant, and the case is now here for review. Inasmuch as it was adjudged in the Colborne Case that Kolchowsky’s negligence would prevent a recovery, it follows that for the same reason no recovery can be had in his case. The judgment of the trial court is affirmed.

Steere, C. J., and Moore, McAlvay, Brooke, Kuhn, Stone, and Ostrander, JJ., concurred.


text:
    NELSON v. LESZCZYNSKI-CLARK CO.
    1. Duress — Payment—Recovery Back of Money Paid Under Threat of Prosecution.
    Where plaintiff claimed that he executed his promissory note to defendant to avoid threatened prosecution for an alleged shortage which defendant charged had arisen while plaintiff was in its employ, and, on the following day when the note matured, paid the amount promised, and there was no evidence that the pressure had been removed in the meantime, the evidence sufficiently showed duress and its continuance to the time of payment.
    2. Same — Bills and Notes — Compromise and Settlement.
    The discontinuance of an attachment suit that defendant had instituted against plaintiff, but which he knew nothing about at the time he gave the note and of which he only incidentally learned on the day he paid it, was not such consideration as to support the payment or the claimed settlement.
    3. Same — Trial—Charge.
    The court did not commit error in charging the jury that plaintiff could recover only if he proved that he was induced by duress to pay a debt he did not owe, or was misled by fraudulent representations that the amount of indebtedness arising out of the shortage was greater than it really was, and plaintiff paid the amount in reliance on such statements, in which case he could recover the difference between what he paid and what he, in fact, owed.
    Error to Huron; Beach, J.
    Submitted June 17, 1913.
    (Docket No. 9.)
    Decided November 3, 1913.
    Case by Edward B. Nelson against the LeszczynskiClark Company, John G. Clark and John Ryan for the recovery of money paid under duress. Judgment for plaintiff. Defendants bring error.
    Affirmed.

      George M. Clark (Wilbur J. Beach, of counsel), for appellants.

      Hall, De Foe & Hall, for appellee.
   Kuhn, J.

The defendant corporation is organized under the laws of this State, and is engaged in the general mercantile business in the village of Palms, Sanilac county. The defendants John G. Clark and John Ryan were stockholders in the corporation, which was capitalized at $3,000. The plaintiff, a young married man of the age of 24, was employed by the defendant company on December 3, 1909, as the manager of its store, and remained in charge until November 28, 1910. Previous to this employment he had spent nearly all his life on a farm, with the exception of one year when he had worked as a rural mail carrier. He had also worked for about six months in a grocery store in a country village, and for three months prior to his employment by the defendant company had been engaged in putting up orders in the wholesale house of Clark & McCaren Company, at Bad Axe. The business management had been taken over in May, 1909, by a Mr. Potts, who, because of ill health, was obliged to leave the business in August, and from that time up to the time of plaintiff’s employment Mrs. Potts, assisted by a young man named Welsh, had charge.

An inventory of the business was taken at the time Potts assumed control; but no inventory was again taken until after the plaintiff had become dissatisfied with his position, and had made arrangements to go West with relatives. When this inventory was compared with the one made in May, 1909, it was found that a loss of $1,728.17 had been sustained in the interim. The plaintiff was sent for, and on December 6, 1910, went to Palms, where he met Mr. Clark and Mr. Leszczynski at the store. The inventories were compared, and after telephoning to defendant Ryan, who is the cashier of a bank at Bad Axe, it was arranged to go to that place the same evening.

There is considerable dispute as to what occurred at Palms and at Bad Axe. It is not claimed that threats were made at Palms; but it is the claim' of the plaintiff that in a private office of the bank at Bad Axe he was told that there was a shortage in his accounts of $3,000, and that, unless he made a settlement of some kind, they would immediately have him “arrested and brought up on a charge of embezzlement, grand larceny, and criminal carelessness;” that, although he denied any knowledge of a shortage, the threats were repeated, and he was told that he had better settle the matter and keep it quiet, because it would bring disgrace to his wife and family and his own people; that he was told that, although the shortage was $3,000, because of sympathy for his wife and baby, they would accept $2,000. Thereupon he signed a promissory note for that amount, dated December 6th and payable one day after date. He also signed and acknowledged before a notary public at the same time another paper, which read as follows :

“Bad Axe, Mich., December 6, ’10.
“I have this day given to Leszczynski-Clark. Company my note for two thousand dollars, payable one day after date. If said note is paid when due said company is to release me from all debts and obligations which I admit that I owe them; should I fail in paying said note, said company have the right to commence criminal and civil action against me.”

The wife of the plaintiff was sworn as a witness, and testified that when he arrived home that evening he was crying, stating that everything had been taken from him. Other witnesses testified as to his mental condition for some time after the settlement. On the day after the settlement he went to the office of Mr. Clark, and demanded the return of his note, which was refused. He thereupon, accompanied by a brother-in-law, went to the law office of Mr. Boomhower in Bad Axe, who at the time was the prosecuting attorney of Huron county, where he was also joined by his two brothers. He claims to have explained the situation to Mr. Boomhower; that he owed the defendants nothing; of the giving of the note and the threats; that Mr. Boomhower, after consulting the statute, told him that, if a charge were preferred against him, and he were found guilty, he could be sentenced to prison for not to exceed five years; that it would probably cost him $2,000 to fight the case, even if he won; that while in Mr. Boomhower’s office he also learned that the defendants had that morning commenced a suit against him by placing an attachment on his farm; that thereupon he went to the bank with his brothers, and arranged to turn a farm which he owned over to them as security, and they took up his note by giving their own note for a like sum, which they paid the following day.

The defendants strongly denied making any threats, and testified that the plaintiff admitted the shortages, and at the interview had with him he stated that the inventories did not contain all the company then owed. Suit was brought, which resulted in a verdict for the plaintiff for $2,000 and interest.

The questions involved in this appeal are grouped in appellants’ brief as follows:

“First. That a verdict for the defendants should have been directed by the trial court.
“Second. That the trial court was in error in instructing the jury that they might find for defendants only in case the shortage approximated $2,000.
“Third. That the trial court erred in refusing to instruct the jury in regard to a voluntary payment with full knowledge of the facts, and in the instructions as to money had and received.
“Fourth. That statements of plaintiff’s counsel were improper and prejudicial.”

In discussing the first proposition, it is urged that the burden was upon the plaintiff to establish duress, and that a verdict should have been directed for the defendants, because plaintiff’s proofs show that the matter was fully and fairly settled upon the advice of his own attorney and his relatives. Whether or not such threats were made became a question of fact for the jury to determine, and the trial judge, under careful instructions, submitted the question to them. It is urged that the plaintiff’s proofs showed that the threats were made at the time of the execution of the note, and that no threats were made on the following day which induced its payment. Accepting plaintiff’s testimony as true, that the threats were made, it appears that the threats were to prosecute unless the claimed shortages were paid. Having no money with him, he gave a note payable the following day. It was not necessary that the threats be again repeated if there was testimony to show that the undue pressure was not removed in the meantime. Briggs v. Withey, 24 Mich. 136; Cribbs v. Sowle, 87 Mich. 340 (49 N. W. 587, 24 Am. St. Rep. 166); Bentley v. Robson, 117 Mich. 691 (76 N. W. 146); Knight v. Brown, 137 Mich. 396 (100 N. W. 602); 22 Am. & Eng. Enc. Law (2d Ed.), p. 614.

The court charged the jury that they must not only find that the -giving of the note was induced by threats of criminal prosecution, but its payment also. It cannot be said as a matter of law, under the facts in this case, that the jury were not warranted in finding that the undue pressure had not been removed. From the time of the giving of the note to the time of its payment plaintiff talked only with his wife, his brother-in-law, and his two brothers, who were farmers with no particular experience in business matters. He demanded the return of the note, which was refused. His conference with Mr. Boomhower certainly did not tend to allay his fears. When he was informed that, if defendants pressed the charge, a prison sentence was staring him in the face, he immediately paid his note. It is true that there must be continued existence of duress; but this question was properly submitted to the jury.

It is urged that the settlement of the attachment suit would be a good consideration for the payment of the plaintiff’s note given the preceding evening. The record shows that the attachment suit was not discussed or mentioned between the parties as to its commencement or discontinuance, and the plaintiff heard of it only by accident while, at Mr. Boomhower’s office. It did not enter into the consideration of either of the notes.

Errors are assigned upon the instruction of the court in case the jury should find that Nelson was responsible for a shortage which did not approximate $2,000, providing the defendants made the claim in good faith. However, we do not consider it necessary to consider these alleged errors, because it is clear that the jury did not come to that phase of the case. It was the claim of the plaintiff that there was no indebtedness. Defendants claimed approximately $2,000 of indebtedness. The jury having rendered a verdict for the plaintiff for the full amount, they must have determined that there was no shortage, and could not have found it necessary to consider instructions by which they were to be governed in case they found a shortage less than the. amount of the settlement. MacKinnon Boiler, etc., Co. v. Land Co., 156 Mich. 11 (120 N. W. 26).

Under the charge of the court the plaintiff could only recover in case he proved, either that he was induced by duress to pay a debt he did not owe, or—

“If in the attempt to settle, defendants wrongfully and intentionally misrepresented the amount of the indebtedness, and plaintiff relied upon such statements of the defendants, and overpaid his indebtedness, he would be entitled to recover back the difference between his payments and the actual.amount of his indebtedness.”

The charge fairly presented the issues which were determined by the jury, and no error was committed in the failure to give defendants’ request to charge as to voluntary payment.

We have examined the assignments of error as to the statements of counsel. When the statements complained of were called to the attention of the trial judge, he immediately, in the presence of the jury, corrected counsel. We find no prejudicial error in relation thereto.

The judgment is affirmed.

Steere, C. J., and Moore, McAlvay, Brooke, Stone, Ostrander, and Bird, JJ., concurred.


author: Ostrander, J.

text:
    MOLIN v. WISCONSIN LAND & LUMBER CO.
    1. Explosives — Gasoline—Regulation—Statutes.
    Under Act No. 37, Pub. Acts 1909 (2 How. Stat. [2d Ed.] § 2598 et seq.), requiring gasoline, benzine, etc., to be kept in receptacles painted red and lettered with tbe name of tbe contents, tbe common law affords a remedy to an individual injured by violation thereof, although the law imposes only a penalty and creates no new remedy; where a duty is imposed by statute for the protection of individuals, the common law usually supplies a remedy if the statute gives none.

    2. Same — Negligence.
    But where defendant permitted servants of a lumbering contractor to use its shop to warm their food and eat lunch, and to build a fire for such purpose, it was not liable because one of them poured gasoline from a' can which was not painted or lettered as required by the statute, in order to start a fire, causing an explosion in which plaintiff was injured, in the absence of any averment that it was customary to use oil or kerosene in building fires, whereby defendant should have anticipated that they would search for and use its oil, and where plaintiff was a mere licensee on the premises and was not invited or permitted to use the oil.
    Error to Menominee; Flannigan, J.
    Submitted June 20, 1913.
    (Docket No. 64.)
    Decided November 3, 1913.
    Case by Victor Molin against the Wisconsin Land & Lumber Company for personal injuries. An order sustaining defendant’s demurrer to the declaration is reviewed by plaintiff on writ of error.
    Affirmed.

      Judd Yelland and CummisJcey & Spender, for appellant.

      F. D. Mead, for appellee.

       As to regulating keeping or storing of explosives, see note in 41 L. R. A. (N. S.) 460.

   Ostrander, J.

The case made by the declaration is briefly stated. Defendant owned a small building used as a blacksmith shop. Plaintiff with others, including one David Larson, was employed by Alfred Paulson to load forest products upon cars in the vicinity of the shop. Defendant permitted Paulson’s men to use the shop for warming and eating dinner and to make a fire in a stove in the shop. Defendant kept and maintained in the shop, in a can, a quantity of gasoline, or benzine, or naphtha. There are three counts in the declaration, varied by alleging in one that the can contained gasoline, in another that it contained benzine, and in the third that it contained naphtha. Going into the shop on March 3, 1911, the plaintiff and Larson proceeded to build a fire in the stove, in doing which Larson poured some of the fluid from the can into the stove. The fluid was ignited by coals of fire which were in the stove, there was an explosion, and plaintiff was injured. The duty of defendant is alleged to be to keep the said gasoline (or benzine, or naphtha) in a receptacle painted red and stenciled gasoline (or benzine, or naphtha), as required by Act No. 37 of the Public Acts of 1909 (2 How. Stat. [2d Ed.] §2598 et seq.), and the breach of duty alleged is that the fluid was kept in a can not labeled and not painted red. It is averred that, while plaintiff was in the exercise of due care, Larson, as the result of the negligence of defendant, procured the can and poured some of the fluid in the stove; “the said plaintiff not then and there knowing the- contents of the said can to be gasoline” (or naphtha, or benzine) but supposing it to be kerosene oil. To the declaration defendant demurred for the reasons:

“(1) Because the declaration fails to allege any such state of facts or such active wrongdoing or wanton or gross negligence as make the defendant liable to the plaintiff under the license or permission granted by it to plaintiff’s émployer, Alfred Paulson, permitting his employees, including plaintiff, to enter and use the stove in the blacksmith shop of the defendant for the purpose therein mentioned.
“(2) Because it appears from said declaration that, at the time the accident occurred resulting in the injury to the plaintiff, the premises were not being used in accordance with the permission granted to Alfred Paulson, the employer of the plaintiff.
“(3) Because it appears from the declaration that the plaintiff was guilty of contributory negligence as a matter of law.
“ (4) Because it appears from the declaration that the plaintiff did not belong to the class of persons which Act No. 37 of the Public Acts of 1909 (the violation of which by the defendant is charged to be negligence) is intended to protect.
“(5) Because it does not appear from the declaration that the defendant belongs to the class of persons who are required by said act to keep gasoline, naphtha, or benzine in the receptacles mentioned in said act and marked as provided therein.
“(6) Because it does not appear that the defendant violated said Act No. 37 of the Public Acts of 1909.
“(7) Because the failure to label the can containing gasoline, naphtha, or benzine was not the approximate cause of the injury.
“(8) Because under the facts as stated in the declaration the defendant owed no duty to the plaintiff to label said can in accordance with said statute.
“(9) Because it does not appear from the facts as stated in the declaration that the defendant was guilty of any negligence.”

The demurrer was sustained and a judgment was entered that plaintiff take nothing by his suit and that defendant go thereof without day. It does not appear that any amendment of the declaration was or is desired.

The case cannot be disposed of on the second, third, fifth, or sixth grounds of demurrer. Fairly ■ interpreted, the declaration charges defendant with a violation of the statute. The command of the statute is: “Every person purchasing gasoline, benzine or naphtha for use or sale at retail shall procure and keep the same only in barrels, casks, jugs, packages or cans painted and lettered as hereinbefore provided” — i. e., in red cans having the word gasoline, or benzine, or naphtha, plainly lettered in English thereon. We must therefore consider the question which is raised by the other asserted grounds of demurrer.

The statute imposes a duty as a regulation of police, and it provides that, if the duty is neglected, a penalty, which may be a fine or imprisonment or both, may be imposed. It does not otherwise point out the consequences of its violation. The authorities recognize as a general rule that, where the duty imposed by a statute is manifestly intended for the protection and benefit of individuals, the common law, when an individual is injured by a breach of the duty, will supply a remedy if the statute gives none. See Barfoot v. White Star Line, 170 Mich. 349 (136 N. W. 437), and authorities cited in the opinion. The duty imposed by this statute is in fact calculated to protect, and we have no doubt was intended to protect, individuals.

It is said by appellant that the statute is intended for the protection of the public; that plaintiff “was rightfully upon the premises and, being a part of the whole public, was entitled to the protection of the statute.” But a duty owing to everybody can never become the foundation of private action at law until some individual is placed in a position which gives him particular occasion to insist upon its performance ; it then becomes a duty to him personally. Illustrating by the facts before us, whether defendant obeyed the statute was a matter of no personal consequence to plaintiff so long as he remained away from defendant’s blacksmith shop or, being rightfully in the shop, so long as he did not use defendant’s property to build a fire. Assuming that defendant violated the statute and that keeping the gasoline (or benzine, or naphtha) as it was kept was negligence per se, was plaintiff a person having the right to insist that the statute duty be performed — to insist that defendant owed him any duty?

In argument appellant seems to make, the answer to this question depend somewhat upon what Larson did. Larson, it is averred, found the can and poured some of its contents into the stove; plaintiff supposing that what the can contained was kerosene oil. The enterprise of building a fire was a joint one, undertaken for the benefit of both Larson and the plaintiff, and involved, on the part of both, the use of defendant’s oil. It is not a case where the can and its contents came rightfully into the hands of Larson for use. Both were on the premises of defendant by permission. Neither had been invited to use them, and neither of them had any business to transact with defendant there. The relation of each to the premises and to defendant was that of a licensee. Did defendant owe them the duty to see that his gasoline (or benzine, or naphtha) was kept in a red can? We think the answer must be “no” unless in giving permission to build a fire defendant ought to have considered that the men were likely to use his kerosene oil for that purpose and might suppose the can in question contained kerosene oil. The plaintiff has not averred a custom or practice in the locality or generally of starting fires in stoves with oil, by reason of which defendant ought reasonably to have anticipated that his licensees would search for his oil and use it to start a fire. We know of no general custom or practice to make such use of kerosene oil.

We conclude that the declaration -alleges no duty owed by defendant to the plaintiff, and therefore affirm the judgment.

Steere, C. J., and Moore, McAlvay, Brooke, Kuhn, Stone, and Bird, JJ., concurred.