text:
    ST. JOHNS NATIONAL BANK v. STEEL.
    1. Statute oe Frauds — Bank Directors — Representations as to Credit.
    Where a director of a bank, in discounting a note for the benefit of another person, was acting, to the knowledge of the cashier, as agent for such person, and not for the bank, he cannot be held responsible by reason of a favorable representation concerning the credit of the maker of the note, unless such representation was in writing signed by him. 3 Comp. Laws, § 9518.
    3. False Representations — Evidence—Question for Jury.
    It is held that the evidence in this case tended to show that defendant falsely represented the maker and indorser of a note discounted for his benefit to be financially responsible, and that therefore the case should have been submitted to the jury.
    Error to Clinton; Stone, J.
    Submitted June 9, 1903.
    (Docket No. 43.)
    Decided December 22, 1903.

      Assumpsit by the St. Johns National Bank against George A. Steel for fraud in obtaining the discount of certain notes. From a judgment for defendant on verdict directed by the court, plaintiff brings error.
    Reversed.

      Norton & Dooling, for appellant.

      H. E. & E. L. Walbridge, for appellee.
   Moore, J.

This litigation was commenced December 4, 1899, in the circuit court. It grows out of the discounting by the plaintiff of three notes, the history of which was given by the cashier of the bank upon the trial as follows:

The first one:

“The original note is dated July 20, 1893, made by the Mt. Pleasant Lumber & Manufacturing Company, in amount $2,300, indorsed by R. M. Steel, discounted July 26, 1893. The time was four months. That note was renewed November 24th by a note made by the Mt. Pleasant Lumber & Manufacturing Company in the same amount, $2,300, the same indorser, R. M. Steel, dated November 23, 1893, time four months. That note was renewed March 26, 1894. That was made by the same company, the Mt. Pleasant Lumber & Manufacturing Company, and in the same amount, $2,300, indorsed by R. M. Steel, dated March 26, 1894. This latter note was made for four months, and renewed August 8, 1894, at which time it was reduced to $2,000. This renewal was dated July 30, 1894, for four months, and renewed again on December 4th, for $2,000, same maker and same indorser, dated December 4, 1894, time four months. This latter note was renewed April 8, 1895, by note made by the same parties, the Mt. Pleasant Lumber & Manufacturing Company, indorsed by Robert M. Steel, in the sum of $2,000, dated April 8, 1895, due in four months. This was again renewed August 12, 1895, by a note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $2,000, indorsed by R. M. Steel, dated August 12, 1895, for four months. This was renewed December 18th by a note of the Mt. Pleasant Lumber & Manufacturing Company in the sum of $2,000, indorsed by Robert M., Steel; note dated December 16, 1895, at four months. This was renewed April 21, 1896, by a note of the Mt.' Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel Company, Limited, given for four months, and is charged off to profit and loss June 9, 1897. The date of this last note is April 30th. This note has not been paid. The amount due upon it, regarding interest at 5 per cent, annually, is $3,539.44.”

The second note:

“The original note was dated June 3, 1893. It was discounted July 13, 1893, made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel, time four months, and went to the credit of R. M. Steel’s account. That note was renewed October 7, 1893, by note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel. That note was dated October 6, 1893, time four months. That note was renewed February 13, ^894, by note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel, dated February 13,1894, time four months. This note was renewed June 3, 1894, by note of $3,000 made by the Mt. Pleasant Lumber & Manufacturing Company, indorsed by R. M. Steel, dated June 15, 1894, time four months. This note was renewed October 30th by note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel, dated October 18, 1894, time 60 days. This note was renewed December 31st by note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel, dated December 30, 1894, time four months. This note was renewed April 33, 1895, by note made by the Mt. Pleasant Lumber & Manufacturing Company in the sum of $3,000, indorsed by R. M. Steel, dated April 33, 1895, time four months. This note was renewed August 36, 1895, by note of $3,000 made by the Mt. Pleasant Lumber & Manufacturing Company, indorsed by Robert M. Steel, dated August 36, 1895, due in four months. This note was renewed January 31, 1896, by note of $3,000 made by the Mt. Pleasant Lumber & Manufacturing Company. This note was dated December 30, 1895, time four months. That is the present note in suit.”

The third note:

“The original note is dated January 17, 1895, made by the Mt. Pleasant Lumber & Manufacturing Company, indorsed by P. W. Carr, in the sum of $1,500,' time four months. The proceeds went to the credit of George A. Steel in general account. This note was renewed July 19th by a note of the same amount, made by the Mt. Pleasant Lumber & Manufacturing Company and indorsed by F. W.- Carr, dated May 25, 1895, time four months. This note was renewed December 20th by a note of the same amount, $1,500, indorsed by P. W. Carr, made by the Mt. Pleasant Lumber & Manufacturing Company, dated September 23, 1895, time four months. This note was renewed February 11, 1896, by a note of the Mt. Pleasant Lumber & Manufacturing Company in the sum of $1,500, indorsed by F. W. Carr, dated January 27, 1896, time four months. This note was renewed June 27, 1896, by a note of $1,500 made by the Mt. Pleasant Lumber & Manufacturing Company, indorsed by F. W. Carr, dated May 27, 1896, at 6 per cent. The exhibit reads: In the upper left-hand corner ‘$1,500 ’ in figures.
“ ‘St. Johns, Mich., May 27, 1896.
“‘Four months after date, for value received, we promise to pay to the order of R. M. Steel fifteen hundred dollars at the St. Johns
National Bank, with-per cent, interest after maturity.
[Signed] “ ‘ Mt. Pleasant Lumber & Manufacturing Company,
‘“I. A. Fancher, Vice-President.
' “ ‘F. W. Carr, Treasurer.’
“Indorsed on back:
“ ‘Pay to the St. Johns National Bank or order, without recourse on me.
“ ‘R. M. Steel,
‘.“Per George A. Steel,
“ ‘Attorney.’
“ Also indorsed by F. W. Carr, personally.”

In the declaration it was claimed that defendant was a director and vice-president of the plaintiff when these notes were discounted, and was bound to give to the bank the benefit of his judgment as to the value of the paper discounted, and that he knew the notes were worthless, but stated to the cashier of the bank they were good, and that the cashier relied upon those statements in taking the notes, paying to said defendant the amount for which they were discounted; that the last renewals of said notes have not been paid. Another claim in the declaration is that it was the duty of the defendant to impart to plaintiff, when the several notes were discounted, any information he had as to the value of the notes, and, instead of doing so, he concealed the information he had that they were worthless. A third claim is that, contrary to his duty to the bank, growing out of his relation to it as director and vice-president, to take care of its interests, he allowed these notes to be discounted by the bank, knowing they were worthless.

The trial began January 13, 1902. After the plaintiff’s testimony was all in, the court, against the objection of defendant, permitted the plaintiff to amend the declaration as to the first two of the notes so as to recite that the proceeds of the notes “went to R. M. Steel, and not to George A. Steel; George A. Steel then and there acting in the capacity of agent for his father and in his behalf.” The defendant was then allowed to amend his plea by giving notice of the statute of frauds. The defendant then asked the judge to direct a verdict in his favor. The trial judge was of the opinion that, as to the two notes the proceeds of which were paid to Robert M. Steel, the statute of frauds applied. He was also of the opinion, as stated in his charge to the jury directing a verdict:

“In an action of this sort brought to recover upon false representations, it is necessary that the plaintiff show what the representations were. The representations may be oral or in writing, it may be by acts, it may be in various ways; but in this particular case it is claimed that the representations were oral representations. Now, then, it was devolved upon the plaintiff to show what those oral representations were. It would be necessary for them to show what the defendant said to the plaintiff at that time upon which plaintiff relied. It would not be necessary for the plaintiff to show the exact language; it would be necessary for the plaintiff, by its evidence, to show in substance what the defendant said. I think it would have to be an assertion of some fact then existing or something that had taken place, and the statement of these facts was substantially put in evidence, out of which arose, as a conclusion, that the representation was made as set forth in the declaration. It is not sufficient that the plaintiff give evidence of the conclusion that he drew from the language. True, the language, or its substance, must be given, so that the jury may, from the language, say whether he drew the conclusion, and say whether it is a correct conclusion or not. And therefore to §ay that we were assured that the makers were good and responsible, without your knowing how those assurances were given or what was said, would simply leave you to draw the same conclusion that the witness drew, or else you would have no premises from which to draw any conclusion at all. And I don’t think that the evidence introduced by the plaintiff is sufficient in that regard, and I don’t think there is such evidence introduced as shows that such representations were made that were false and fraudulent, and upon which the plaintiff, and in reliance upon which the plaintiff, discounted the note. I don’t think there is such evidence either as, all of it taken to be true, would permit you to find a verdict for plaintiff upon that evidence; it is too uncertain in its character, and does not state facts, but conclusions; a mere hypothesis, upon which conclusions could not be drawn; that is. what he thinks or what he believed, without stating what was said or what was the substance of what was said; and in some instances whatever was said was largely an expression of opinion, upon which, under the circumstances, the bank — the plaintiff— did not have a legal right to rely.
“ I think there was testimony in the case given by the cashier that, at the time the note was discounted, the defendant told him that F. W. Carr, the indorser, was worth $75,000. I don’t remember any evidence being given in the case by the plaintiff showing what F. W. Carr was worth at that time, or any evidence bearing upon what property Mr. F. W. Carr did have. It is just as necessary for the plaintiff in a case of this kind to show the representations are false as it is to show that they were made.”

The plaintiff brings the case here by writ of error. Nearly all the oral testimony offered on the part of the plaintiff was that of the cashier. His testimony as to what was said by Mr. Steel when these notes were discounted is not very clear or very positive. The following are fair examples of his testimony:

Q. On that occasion state whether or not any representations were made by him as to the responsibility of the makers and indorsers upon that note.
“A. There was; I could not give the exact language, Mr. Norton.
Q. You may give the substance as near as you can.
“A. In a general way we were assured that the makers and indorsers were good and responsible. I think every one of the renewals that were presented on the several • occasions that I have given in relating the history of this paper went through my hands. * * *
“Q. On that occasion what was said, if anything, in regard to the responsibility of the parties upon that paper ?
l'A. I was assured that they were responsible; that Mr. Carr was worth $75,000.
“Q. Did Mr. Steel state that to you?
“A. Yes.
“Q. On that occasion state whether or not Mr. Steel stated to you that Mr. Carr was financially embarrassed and insolvent.
“A. No, sir. He never told me that his father was financially embarrassed and insolvent. I was assured that the Mt. Pleasant Lumber & Manufacturing Company was responsible. He never informed me that they were financially embarrassed and insolvent.
“Q. What was said, on those several occasions that this note was renewed, in regard to the responsibility of the parties ?
“A. Mr. Steel has repeatedly assured me that the Mt. Pleasant Lumber & Manufacturing Company were perfectly good as far as he knew, that they had plenty of lumber in their yard, that sales were a little slow, that they had plenty of means to pay their debts, that P. W. Carr, so far as he knew, was perfectly responsible. I think he stated that he had qualified upon a bond up there for something like $100,000. . In his judgment, they were perfectly good.
“Q. Was that true on the several occasions that those renewals were made upon this note ?
“A. It might not have been upon every occasion, but it was on several occasions. The note was originally discounted on January 17, 1895; the next or first renewal was the following July, — July 19th; the next one was December 20th.”

From the cross-examination of this witness it appears Mr. George A. Steel ceased to be a director of the bank December 2, 1895. He also testified that, as to the first two notes,'George A. Steel presented them for his father; that' the bank purchased them, and passed the amount thereof to the credit of Robert M. Steel; that at this time Mr. Robert M. Steel’s account was overdrawn, and that it was a frequent occurrence for it to be overdrawn; and that until a short time before his failure the bank would not refuse to honor the check of Robert M. Steel, even though his account was overdrawn; He testified, among other things:

“ Q. Now, you would not have hesitated, would you, in 1893, to take the paper indorsed by Robert M. Steel ?
“A. No, sir; I didn’t hesitate. I would not want to say that I took the paper simply because his name was on the paper.
Q. You would not want to admit that that was not true ?
“A. No, sir. Mr. R. M. Steel was at that time considered ,as perfectly responsible,- — financially so. It is true that I took the paper that he owned, or offered to the bank for discount, because I saw his name upon the paper, and I relied upon that, understanding his responsibility, in doing that. There were seven directors in our bank in 1893. They were Robert M. Steel, George A. Steel, John Hicks, and I think his son, John C. Hicks, Coleman C. Vaughan, Cooley Ball, Galusha Pennell, and myself. John Hicks is a merchant here in town. Cooley Ball is in the hardware business. I don’t know as we had a discount committee that made that their special duty. I don’t think we had a discount committee in July, 1893, the 13th.
“ Q. You don’t think you had any discount committee ?
“A. That is, in the sense that they passed on paper as it was presented.
Q. Did you have a discount committee made up of your board of directors ?
“A. Yes, I think we did. I would not be sure who they were, but I think it was Mr. Ball, Mr. Hicks, Mr. J. C. Hicks, if I recollect, — I would not be sure as to that.
Q. You had a discount committee, did you not, during the entire time from July 13, 1893, up to the time that the piece of paper that you now present was discounted at your bank?
“A. I think we did; yes.
Q. Did these same persons constitute the same discount committee, or did you have different ones ?
“A. I don’t know; sometimes there might have been a ' change made.' I was not in the habit of presenting paper that was offered to our bank for sale or discount to the discount committee to pass upon it as to whether they would buy it or not.
Q. You passed upon that yourself, did you ?
“A. Not always. I generally consulted the president of the bank and the vice-president. The president was John Hicks, the vice-president was Mr. Pennell. I don’t think I counseled Mr. Hicks and Mr. Pennell in 1893 in regard to the paper upon which Mr. R. M. Steel’s name appeared.
Q. You simply took it because his name was upon the paper, as a matter of fact ?
“A. Not entirely.
Q. Well, that was the principal reason, was it not,— because R. M. Steel’s name appeared upon the paper ?
“A. Well, that was one of the reasons,— probably the principal reason.
“Q. Wasn’t that the real reason ?
“A. No.
“Q. Now, you say that when George presented this note on the 13th day of July, 1893, he assured you that the paper was good ?
“A. To the best of my recollection he did; yes.
“Q. Will you swear that he made any representations whatever as to that paper ?
“A. Mr. Walbridge, I don’t know as I could swear to that; I think he did.
“Q. Don’t you know as a matter of fact that, upon that very day when he sold that paper to you, you knew that you were taking the paper of R. M. Steel, knowing that you were buying it, because R. M. Steel’s name was upon it, and you considered R. M. Steel good; is that not true ?
“A. Not entirely; no, not entirely.
“Q. Will you swear that George A. Steel made any representations at that time as to the responsibility of the paper ?
“A. On or about that time,— yes.
“Q. At the time that you bought it, I mean ?
“A. No, sir; I will not swear that he did.
“Q. ‘On or about that time,’ — what do you mean by that ?
“A. I mean by that that Mr. Steel was in our officeevery day; he was a frequent caller there; that these matters would come up, and I would ask about them, and invariably he informed me that these matters were all right. I wouldn’t ask him about this until he presented it for sale.
Q. You would not swear that, at the time that he presented that paper to you for sale, he made any representations to you about it ?
“A. No; on or about that time.
Q. You just said that you would not swear that he did on that day ?
“A. Yes, I did. I don’t known that I ever saw the paper before that time. I don’t know as I ever had any talk with George A. Steel about that paper before that day. The $2,300 note was presented to our bank for sale the 26th day of July, 1893. ° George A. Steel presented that paper to our bank and to me on that day. That paper had not been seen by me before that day, that I know of.
Q. Will you swear that upon that day George A. Steel made any representations to you in regard to the responsibility of the maker and indorser of that paper ?
“A. I think about that time. ~
Q. You say that you never saw that paper before the day you bought it; that is, you have no recollection of seeing it; did you have any reason for talking with George A. Steel about buying the paper before you bought it ?
“A. No, sir.'
‘ ‘ Q. Isn’t it true that you bought that paper of George A. Steel, acting for his father, upon the 26th day of July, because you believed Robert M. Steel to be perfectly responsible, and because he was upon the paper as indorser ?
“A. That is one reason; yes.
“ Q. Isn’t that the real reason ?
“A. That may be one of the principal reasons.
Q. Will you swear that upon the 26th day of July, the day he sold the paper to you, that George A. Steel said anything to you about the responsibility of his father- or the Mt. Pleasant Lumber & Manufacturing Company ?
“A. No, I will not. The proceeds of that note went to the credit of Robert M. Steel on general account. * * * I understood, at the time that we were buying the paper of Robert M. Steel, George was acting as agent for Robert M. Steel, and acting for his father in discounting the paper. I have looked at the bankbook for the purpose of ascertaining the state of Mr. Steel’s account on the 26th day of July, 1893. The account of Robert M. Steel on July 26, 1893, was overdrawn the sum of $1,299.74.”

As to the $1,500 note he testified:

“A. I understood that he was presenting it there as George A. Steel personally, and I understood that George A. Steel was acting for himself in selling it, and I was acting for the bank.”

It is claimed by plaintiff this testimony shows that George A. Steel made representations that were relied upon by the cashier. On the part of the defendant it is insisted no representations are shown to have been made that it was improper to make, and that the credit was given because the bank believed that Robert M. Steel was perfectly good, and that the trial judge was justified in his conclusion that the defendant was not liable because of any representation made.

As to the first two of these notes, the proceeds of which were passed to the credit of Robert M. Steel, we do not think it necessary to pass upon the above question. It is very clear from the testimony of the cashier that, in relation to the discounting of these notes, George A. Steel was not acting for the bank, and the cashier did not understand he was so acting, but, on the contrary, did understand he was acting as the attorney for his father. The fact that he was a director of the bank did not preclude his offering to the bank paper for discount. In Hicks v. Steel, 126 Mich. 408 (85 N. W. 1121), it is said:

“ A director may do business with a bank, and may borrow money or discount notes, so long as he does not act for the bank as well as himself; and his relation to the bank may be not different from that of any other patron. ”

See Smith v. Skeary, 47 Conn. 47; 1 Mor. Priv. Corp. (2d Ed.) § 537.

He offered this paper for his father, acting as his agent. The proceeds were placed to the credit of his father. George A. Ste’el obtained no benefit from the transaction. Section 9518, 3 Comp. Laws, provides:

“No action shall be brought to charge any person upon or by reason of any favorable representation or assurance made concerning the character, conduct, credit, ability, trade, or dealings of any other person, unless such representation or assurance be made in writing, and signed by the party to be charged thereby, or by some person thereunto by him lawfully authorized.”

In a case upon all fours with this feature of the case, the statute was construed as contended for by the defendant in the recent case of Third Nat. Bank of New York v. Steel, 129 Mich. 434 (88 N. W. 1050).

As the case stands, it is admitted by defendant the statute of frauds does not apply to the $1,500 note. It is insisted no false representátions were made concerning the paper. Counsel quote from the testimony of the cashier at considerable length, and say:

“It is too uncertain and indefinite, too speculative and hypothetical, to be submitted to a jury for it to speculate upon, and to guess at something about which there are no tangible facts in the case which the jury can consider as a basis from which to draw any conclusion one way or the other. It is merely the conclusion of witness, consequently has no force or weight. Witnesses are not permitted to state their conclusions or deductions from facts, but must be confined to the communication of facts simply;” citing 1 Thomp. Trials, §§ 377, 378.

It is also claimed that, if it be conceded representations were made, they were not shown to be false. It is said it is not shown the company was insolvent, nor is it shown Carr was insolvent.

We cannot agree with the conclusion reached by the trial judge and the contention of counsel upon this branch of the case. As before stated, no testimony was put in on the part of the defendant. It appears from the testimony of the cashier that the proceeds of this note passed to the credit of the defendant. There was' testimony tending to show that Mr. Steel represented that the maker of this note was good and that Mr. Carr was worth $75,000. We think the correspondence between Mr. Carr and the defendant tended to show that the company was greatly embarrassed at the times the original note was given and the renewals made, and.that the letter of June 28, 1895, tends to show that, instead of being worth $75,000, Mr. Carr was greatly embarrassed financially, as it was stated therein he did not have a cent to pay railroad fare. The testimony as to this note raised a question of fact which should have been submitted to the jury.

Judgment is reversed, and a new trial ordered.

Carpenter, Grant, and Montgomery, JJ., concurred. Hooker, C. J., took no part in the decision.


source: Caselaw Access Project

author: Moore, J.

license: Public Domain

text:
    McDONALD v. BORN.
    Mortgages — Illegal Consideration — House of III Fame.
    A mortgage purporting on its face to be given to secure the repayment of money on certain conditions therein expressed is void where the money was in reality paid to the mortgagor to enable the mortgagee to conduct a house of ill fame.
    Appeal from Houghton; Streeter, J.
    Submitted October 8, 1903.
    (Docket No. 90.)
    Decided December 22, 1903.
    Bill by Frankie A. McDonald against Louis Born to foreclose a mortgage. From a decree dismissing the bill, complainant appeals.
    Affirmed.

      John Power, for complainant.

      Joseph F. Hambitzer, for defendant.
   Moore, J.

This is a proceeding in chancery to foreclose a mortgage. From a decree dismissing the bill for want of equity, the complainant has brought the case here by appeal. The mortgage was dated May 31, 1899, and provided for the payment by the defendant of $280, or any further sums paid under an agreement of the same date. The material parts of the agreement are as follows:

“ Whereas, in a certain cause pending in the circuit court for the county of Houghton and State of Michigan, in chancery, in which Frankie McDonald is complainant and Louis Born is ■ defendant, a stipulation has this day been entered into by the solicitors for the respective parties thereto, by and with the consent of the parties, extending the time for perfecting and completing an appeal of said cause to the Supreme Court for the State of Michigan, and permitting and allowing said Frankie McDonald to appeal said cause to said Supreme Court; and
Whereas, in consideration of said Born’s permitting said Frankie McDonald to so appeal said cause to the Supreme Court of the State of Michigan, she, the said Frankie McDonald, has paid the said Louis Born the sum of two hundred and eighty dollars, being rent due for said premises from the 18th day of April, A. D. 1898,.to the 18th day of June, A. D. 1899, under the decree already made in said cause, and agrees to pay twenty dollars a month in advance as rent for said premises during the pendency of said above-entitled cause, upon condition that said Louis Born shall, in the event of said cause being ultimately determined against him and a decree entered in favor of said Frankie McDonald, repay and refund to said Frankie McDonald said sum of two hundred and eighty dollars, and all further sums which said Frankie McDonald may pay said Louis Born for rent of said premises, to secure the payment of which said Louis Born has this day executed a mortgage to said Frankie McDonald,” etc.:
“Now, therefore, the said Louis Bom hereby agrees that, should said cause be decided adversely to him and in favor of the said complainant, Frankie McDonald, he, the said Louis Born, will pay the said Frankie McDonald the said sum of two hundred and eighty dollars by her to him this day paid, and all other and further sums paid by said Frankie McDonald as rent of said premises during the pendency of this suit, within thirty days after notice to him of a final decree therein in favor of said Frankie McDonald, which payment is secured by a mortgage this day executed by said Louis Born to said Frankie McDonald on the south seventy feet of lot seven of block one of the village of Houghton, Houghton county, Michigan, according to the recorded plat thereof; and the said Frankie McDonald hereby agrees that she will, from and after the 18th day of June, A. D. 1899, pay the said Louis Born the sum of twenty dollars per month, in advance, as rent of the premises involved in said cause during the pendency thereof, and that, if said cause be decided adversely to her, the said Frankie McDonald, she will deliver up possession of the premises involved in said cause within fifteen days after notice to her of the entering of a decree therein in favor of the said Louis Born.”

It is the claim of complainant that the mortgage and the written agreement contain all of the agreement made between the parties, and that she made payments under said agreement aggregating $980; that the title was found to be in her ultimately, and that she should have a decree for that amount and interest. The record discloses that, some years before the mortgage was made, the complain' ant had been a tenant of defendant. Some time after her occupancy began, she claimed she had a land contract for the purchase of the north 30 feet of the land described in the mortgage, and began proceedings to enforce her contract. The defendant claimed the contract was procured from him when he was drunk, and without consideration, and the court so found upon the trial; that he then took proceedings to oust the complainant; that she was keeping a house of ill fame upon the premises; that she agreed, if he would not disturb her, she would pay him $20 a month, and, if the Supreme Court decided in his favor, that should cancel the mortgage, and she would deliver possession to him; and that this was the purpose of making the mortgage and the agreement. He further claimed the Supreme Court did decide in his favor, and the complainant then told him her attorney would cancel the mortgage* and he took proceedings to get possession of the premises, when the complainant agreed with him, if he would not disturb her possession or her business, she would pay him |50 a month, and that she did so from the time the opinion in this court was rendered up to the 18th of December, 1900. He claims that during all that time the house was used as a house of ill fame; that the transaction was an illegal one, and the courts will leave the parties where they have left themselves.

Counsel for complainant states his claim as follows:

' ‘ ‘ Where it is claimed that a contract is tainted with illegality and is opposed to public policy by reason'of elements entering into it or connected with it which, under some circumstances, would render the contract obnoxious to the law relating to public policy, the test to determine its validity is the plaintiff’s ability to establish his case without any aid from an illegal transaction. In determining whether a new contract is so connected with an illegal contract or transaction as to render it also illegal, the test has been announced to be whether the plaintiff, in establishing his case, is or is not required to resort to the illegal contract. In the former case the contract is held to be illegal; in the latter it is held to be legal.”

One of the troubles of this contention is that a preponderance of the testimony upon the question of fact sustains the version of the defendant. The written contract is somewhat ambiguous as to what the effect of the opinion of this court should be in relation to the repayment of the $20 and the delivery of the possession of the premises by the complainant to the defendant. We have already given the defendant’s version of the transaction. It is a significant fact that complainant was not a witness. A reference to the case of McDonald v. Born, 121 Mich. 595 (80 N. W. 575), will show the case was decided in this court October 24, 1899. The record shows that in March following complainant paid $100 to defendant, and took a receipt reciting it was for rent from March 18th to May 18th. On May 18, 1900,-she paid $300, taking a receipt, in which it was stated it was rent to November 18, 1900. November 22d she paid $50, taking a receipt stating it was for rent from November 18 to December 18, 1900. The record also shows that between June 27, 1898, and December 3, 1900, complainant was convicted at least 16 times on her plea of guilty of .keeping a bawdy house, and was living in the house defendant claimed to be his', for which she paid the above sums as rent. It is impossible to read the record and reach any other conclusion than that this money was paid to enable complainant to conduct an illegal business.' Under such circumstances the courts will leave the parties where their acts have left them. Snyder v. Willey, 33 Mich., at page 495, and the many cases there cited; Lyon v. Waldo, 36 Mich. 345; McNamara v. Gargett, 68 Mich. 454 (36 N. W. 218, 13 Am. St. Rep. 355); Robinson v. Patterson, 71 Mich. 141 (39 N. W. 21); Case v. Smith, 107 Mich. 416 (65 N. W. 279, 31 L. R. A. 282, 61 Am. St. Rep. 341); Harris v. Chamberlain, 126 Mich. 280 (85 N. W. 728); 15 Am. & Eng. Enc. Law (2d Ed.), pp. 992-997.

The decree is affirmed, with costs.

Carpenter, Grant, and Montgomery, JJ., concurred. Hooker, C. J., took no part in the decision.

       The present suit is based upon the fact that subsequently, on bill of review, complainant was granted a decree of specific performance.


text:
    VAN DRIELE v. KOTVIS.
    1. Wills — Invalid Clause — Suspending Power oe Alienation, Where a clause in a will which suspends the power of alienation in a manner not based on lives can be eliminated without affecting the general plan and primary purpose of the testator, the will should be sustained. So held where a testator gave successive life estates to his wife and daughter, with proper disposition of the remainder, but also made a bequest to a church society, to be paid by the executor, from the issues and profits of the estate, in 20 annual installments.
    2. Same — Contingent Remainders — Uncertainty.
    A devise of an estate in remainder to such person or persons as shall, by the law in force at the termination of the precedent life estate, be entitled to inherit real estate from testator’s wife, is not void for uncertainty.
    Appeal from Kent; Wolcott, J.
    Submitted October 9, 1903.
    (Docket No. 33.)
    Decided December 22, 1903.
    Bill by Katharine J. Van Driele and Wilhelmina S. Van Driele against John Kotvis-, executor of the last will and testament of Ary Van Driele, deceased, for a construction of said will. From the decree rendered, complainant Wilhelmina S. Van Driele appeals.
    Affirmed.

      Grove & McDonald, for appellant.

      William H. Eastman (Diekema & Kollen, of counsel), for defendant.
   Moore, J.

The bill in this case is filed for the purpose of obtaining a construction of a will made by Ary Van Driele, deceased. The material parts of the will read as follows:

“First. I direct that all my just debts and funeral expenses be paid by my executor out of my personal estate.
“Second. I will and direct that, as soon as convenient after my death, my executor cause to be placed in an appropriate place or places on my monument on lot seventy-two, block L, Valley City Cemetery, my name and date of birth in raised letters, viz., ‘Ary Van Driele, born December 35th, 1830.’
“Third. I give, grant, and bequeath to the Fourth Dutch Reformed Church of the city of Grand Rapids, State of Michigan, the sum of five hundred dollars, to be' paid by my executor out of the rents, issues, and profits of my estate in the manner following, to wit: Twenty-five dollars per year, for a period of twenty years.
“Fourth. My son-in-law, Peter Dogger, is indebted to me in the sum of three thousand dollars, more or less, for advancements made to him; and it is my will that said debt be satisfied and forgiven, and I direct my estate and the executor thereof to make no effort to collect said debt from him, and that all instruments and evidence of such indebtedness be canceled by my executor.
Fifth. I give, devise, and bequeath my organ to my daughter, Wilhelmina Sophia Van Driele; but in case she does not wish the same, and is willing to part with it, then, in that case, I give, devise, and bequeath said organ to Lena Tang Anderson. * * *
Seventh. I give, devise, and bequeath all the rest, residue, and remainder of all the rents, issues, and profits of all my personal and real estate, wherever the same may be situated, to my wife, Katharine Johanna Van Driele (whose maiden name was Katharine Johanna Gernler), for her sole and separate use during her life, but upon the following conditions, viz.: That she shall remain my widow; that she shall not oppose or contest my last will and testament, nor refuse to execute and sign any papers necessary for her to sign and execute in order to make perfect conveyances of any real estate which I may have contracted to be disposed of, — the same to be held and enjoyed by my said wife in lieu of her dower interest in my said estate. In case my said wife shall remarry, oppose or contest this will, or refuse to execute and sign any necessary papers to make perfect conveyances of real estate as in this paragraph mentioned, then, in such case, I give, devise, and bequeath to my said wife one-third of all said rest and residue of all the rents, issues, and profits of my said personal and real estate, for her sole and separate use during her life, and the remaining two-thirds thereof I give, devise, and bequeath to my sole surviving daughter, Wilhelmina Sophia Van Driele, for her sole and separate use during her life.
‘ ‘ Eighth. From and after the death of my said wife, I give, devise, and bequeath all of the said rest, residue, and remainder of all the said rents, issues, and profits of all my said personal and real estate, wherever the same may be situated, to my said sole surviving daughter, Wilhelmina Sophia Van Driele, for her sole and separate use during her life.
11 Ninth. From and after the death of both my said wife and daughter, it is my will, and I hereby direct, that all my property, both real and personal, wheresoever the same may be situated, and not herein otherwise disposed of, shall be disposed of as follows, viz.: One-half thereof I give, devise, and bequeath to such person or persons as shall, by the laws of the State of Michigan then in force, be entitled to inherit real estate from myself, and in the same proportions, and that the other one-half thereof I give, devise, and bequeath to such person or persons as shall, by the laws of the State of Michigan then in force, be entitled to inherit real estate from my said wife, and in the same proportions; provided that, in case my wife’s sister, Elizabeth Tang, shall not be living at the date of the death of my said wife and daughter, that in such case the share or proportion of my estate that would go to said Elizabeth Tang under this paragraph, had she been living at that time, shall go and belong to the then living daughters of said Elizabeth Tang, in equal shares; the sons of said Elizabeth Tang being hereby expressly excluded .from inheriting anything under this will. * * *”

The bill asks, among other things, that the court decree as follows:

“ That the third paragraph of said will is invalid.”
“That the seventh paragraph vests in Katharine Johanna Yan Driele a life estate in all the real and personal estate mentioned in said seventh paragraph, subject only to the conditions therein expressed, and that she is entitled to the possession and control of the same.
“ That the ninth paragraph of said will is void for uncertainty as to the objects of the gift, devise, and bequest therein attempted to be made, and because it is in conflict with the law.”
“That the eighth paragraph of said will vests in your oratrix Wilhelmina Sophia Yan Driele a life estate in all of the personal and real estate mentioned in said paragraph, subject to the life estate of your oratrix Katharine Johanna Yan Driele, created by the said seventh paragraph of said will, and that by reason of the invalidity of the said paragraph 9 of said will, and because, by the provisions of said will, there is a suspension of the absolute power of alienation not based on a life or lives, the absolute fee in all of the real estate of which the said testator died seised vested in your oratrix Wilhelmina Sophia Yan Driele immediately on the death of said testator.”

The court made a decree in accordance with the prayer of the bill, except as follows:

“ That the ninth clause of said will is valid, and creates a contingent remainder, subject to the said life estates of the said complainants, in all the property, both real and personal, of the said testator, which will become vested, from and after the death of both of the said complainants, in those classes of persons described in said ninth clause of said will, as they may be found to exist after the death of both of said complainants, under the laws of the State of Michigan which may then be in force with reference to the inheritance of real estate.”

From this decree the daughter, Wilhelmina S. Van Driele, has brought the case here by appeal. The mother and the executor have not appealed.

The solicitors for appellant say the single question presented by this appeal is the validity of the contingent remainders which the testator attempted to create by the ninth paragraph of his will. It is said the court was right in holding the third paragraph was in violation of the statute, and void; that the will confers upon the executor no trust, except that with which an executor is clothed by law in the absence of an express trust. Counsel say:

‘£ It seems to us that the intent of the testator was to tie up this estate for 20 years in the hands of his executor, inalienable for that period, and perhaps longer, if his daughter should live beyond that term, and that the whole scheme of the will must fail for that reason, except so far as payment of debts, the execution of the fourth and fifth paragraphs of the will, and the closing and settlement of the estate in respect thereto, and that, as to the residue, it must be disposed of as intestate property. * * *
“We also contend that if it should be held that the third paragraph of the will is void, and that the complainants are given successive life estates, that it does not follow that the contingent remainders attempted to be created by the ninth paragraph are valid. We claim that these contingent remainders are void because of uncertainty as to the persons to whom they are limited; because those persons cannot be known or ascertained, and are not capable of being designated; and because the testator has failed to lawfully dispose of the fee to his realty by his will. We understand it to be a settled principle of the law that the absolute fee in land wiil become vested immediately on the death of the testator, and unless he, by the provisions of his will, devises it, either directly or in trust, the law vests it at once in the heir. If, then, the third clause of this will be held void, and it be held that the will created successive life estates in the complainants, it seems to us that it must be held that inasmuch as the testator did not, by his will, devise it to become vested anywhere at his death, and inasmuch as it must go somewhere immediately upon the dea-th of the testator,- — either to the devisees, or to the heir at law as undisposed of by the will, —it vested in the complainant Wilhelmina Sophia Van Driele, as sole heir at law, at the death of the testator, subject to the life estate in her mother, if it be held that such life estate is created by the will.”

Counsel also claim that it was the intent of the testator that the executor should hold the estate in his hands for 20 years, as is indicated by the provisions of paragraph 3, which, if valid, would suspend the power of alienation for 20 years; “that it was a part of the testator’s general plan or scheme to render his estate inalienable for a definite term of 20 years, at least. If this be so, the third clause of the will cannot be eliminated, and the other provisions remain. For if his primary intent was to suspend the power of alienation, and this and other provisions of the will were made for the purpose of effectuating that intent, then the whole will must fall, and the estate descend as intestate property,” — citing cases.

If counsel are right in saying the primary purpose of the will is found in paragraph 3, and the other provisions of the will were made for the purpose of accomplishing that intent, then, doubtless, they are right in claiming the will must fall, and the estate descend as intestate property. The record does not disclose the extent of the estate. The bill avers that the estate consists almost wholly, or very largely, in real estate, mostly houses and lots in the city of Grand Rapids, which, at the time of the death of the said Ary Van Driele, were occupied by tenants, and which are still occupied in greater part by the same tenants; that there are no debts, except trifling ones; and asks that, after payment of the debts, funeral expenses, and expenses of settling the estate, the balance of the personal property be turned over to the complainants by the executor. In view of these averments, and the provisions of the will releasing his son-in-law from a debt of $3,000, and the giving to his wife the rents and profits of his estate for life upon certain conditions, it is fair to infer that the estate left by deceased is a considerable one. The bequest to the church is not a large one, and, taking the will as an entirety, there is nothing to indicate that the other provisions of the will would not have been made just as they are, independent of the provisions of the third paragraph. The important parts of the will are the provisions made therein for the wife and daughter during their lives, and the disposition of the fee. The will indicates very clearly what the intent of the testator is in those particulars, and should be given effect, if possible. In Palms v. Palms, 68 Mich. 355 (36 N. W. 419), it is said:

c ‘ It is the wise and beneficent purpose of the courts, if possible, to uphold and sustain wills when there is no doubt whatever of the sanity and perfect competency of the testators to make them, and that(they were executed without duress or any undue influence. It is also considered the duty of the courts to so interpret the conditions of a will, where there is any obscurity or ambiguity of expression, as to carry out the intention of the testator, when such intention can be plainly gathered from the whole body of the instrument, and is a legal one. And when the intent is manifest, and there are separate trusts or provisions which are not so connected together as to constitute an entire scheme, so that the .presumed wishes of the testator would be defeated or nullified if one were held legal and others illegal, and the legal can be separated from the illegal without doing injustice to any of the legatees or beneficiaries under the will, as their rights are indicated by the wishes of the testator therein expressed, the illegal trust may be cut off, or the invalid provision eliminated, and the legal one permitted to remain; thereby effectuating, as far as the law will permit, the will of the maker of the instrument.”

See Dean v. Mumford, 102 Mich. 510 (61 N. W. 7); Hibler v. Hibler, 104 Mich. 274 (62 N. W. 361); Thurber v. Battey, 105 Mich. 718 (63. N. W. 995); Robinson v. Finch, 116 Mich. 180 (74 N. W. 472).

We think the will indicates clearly an intent to give the wife and daughter, and the survivor of them, a life interest, only, in the estate of the testator.

Are the provisions of paragraph 9 void because of uncertainty as to the persons who would take the property at the time mentioned therein ? It is a matter of common knowledge that wills are frequently drawn creating a life estate in some person, and providing that, upon the death of that person, the estate shall be divided as provided in said wills among the children of the testator who are then living. The validity of such wills has not, so far as we know, been questioned, though it is manifest the testator could not know who of his children would be living at the time of the death of the owner of the life estate. It may be safely assumed there will always be some statutory provision in this State as to who shall inherit real estate. The statutes of the State would clearly indicate the persons who, at the time of the death of the survivor of the widow and daughter of the testator, would be entitled to inherit the real estate of the testator, and who would be entitled to inherit the real estate of his widow. See Hughes v. Hughes, 91 Wis. 138 (64 N. W. 851); Trolan v. Rogers, 79 Hun, 507 (29 N. Y. Supp. 899); Rosenau v. Childress, 111 Ala. 214 (20 South. 95); Jones Appeal, 48 Gonn. 60; Belfield v. Booth, 63 Conn. 299 (27 Atl. 585); Hopkins v. Keazer, 89 Me. 347 (36 Atl. 615); Womrath v. McCormick, 51 Pa. St. 504; In re Winter's Estate, 114 Cal. 186 (45 Pac. 1063); Butler v. Bushnell, 3 Mylne & K. 232; Jones v. Colbeck, 8 Vesey, 38; Wharton v. Barker, 4 Kay & J. 483.

The decree is affirmed.

Carpenter, Grant, and Montgomery, JJ., concurred. Hooker, C. J., took no part in the decision.


author: Grant; J.

text:
    STEPHENS v. PENNSYLVANIA CASUALTY CO.
    1. Casualty Insurance — Construction of Contract — Indemnity Against Liability.
    A contract of indemnity insurance against liability for injuries w to persons by reason of the operation of a street railway, which provided that the indemnity should not be payable until the loss or damage had been adjusted and settled by the insurance company, and that it should have control of all legal proceedings against the railway company for such injuries, being a contract to indemnify against liability, and not merely to indemnify against damage, the liability of the insurer became fixed when final judgment was rendered against the railway; the payment of the judgment not being essential.
    2. Same — Time op Liability.
    Where, under such a contract, the case against the railway was appealed to the Supreme Court, the indemnity did not become due and payable until the determination of the case in that court.
    3. Garnishment — Paying Money Into Court — Interest.
    Garnishment proceedings will not prevent the running of interest where the garnishee does not avail himself of the privilege of paying the money into court under 3 Comp. Laws, § 10627.
    4. Contract of Indemnity — Costs on Appeal.
    Under a contract of indemnity giving the indemnitor a right to control the defense in an action against the indemnitee, ' either of the parties to the contract may appeal, and the one appealing must pay the costs if the judgment is affirmed.
    Case made from Wayne; Kohnert, J.
    Submitted October 21, 1903.
    (Docket No. 61.)
    Decided December 22, 1903.

      Assumpsit by Henry Stephens against the Pennsylvania Casualty Company on a contract of indemnity. There was a judgment for plaintiff on verdict 'directed by the court, and defendant assigns error.
    Modified.

      This is a case made after judgment. On April 14, 1900, the defendant and the Detroit, Rochester, Romeo & Lake Orion Railway entered into a contract of indemnity; the only parts which bear upon this controversy being as follows :
    “ In consideration of the agreements hereinafter and the warranties in the application for this policy contained, which application is made a part of this contract of insurance, and of fourteen hundred dollars premium, the Pennsylvania Casualty Company of Scranton, Pennsylvania (hereinafter called ‘the company’), does hereby agree to indemnify Detroit, Rochester, Romeo & Lake Orion Railway of Detroit, county of Wayne, and State of Michigan (hereinafter called ‘the assured’), for term of one year, beginning on the fourteenth day of April, 1900, at noon, and ending on the fourteenth day of April, 1901, at noon, standard time, against legal liability of the assured for injury to or death of persons, and all legal liability arising or accruing therefrom for loss of service, funeral expenses, and medical attendance, being the result of casualties occurring by reason of the operation of the street railway named in the said application, to an amount not to exceed twenty-five hundred dollars for injury to or death of any one person, and, subject to the same limit for each person, not to exceed ten thousand dollars for the total liability in any one casualty whereby several may be killed or injured, and not to exceed thirty thousand dollars for total liability during the term of this contract.
    “ Special Agreements.
    * * * * * * *

      “ 7. The indemnity hereby provided for shall not be payable until the loss or damage has been adjusted and settled by the company, nor until thirty days after satisfactory particulars of the loss or damage shall have been furnished the company.
    ‘ ‘ 10. The company shall have control of the defense of any legal proceedings against the assured, in the name and on behalf of the assured, for accidents covered by the provisions of this contract, and, in' case legal proceedings shall be instituted against the assured for such accidents, the assured shall, within five days of the service of any writ upon the assured, deliver to the company, at its home office, any writ, and all papers or copies of the same, pertaining to said suit or action, and all other papers received, possessed, or controlled by the assured, relating to such suit or action, immediately upon receipt of same, and keep the company at all times informed of each successive step and of all steps taken in said suit or action immediately upon the occurrence of the same, and render to the company all necessary information and assistance to properly conduct a defense, or prosecute an appeal, or effect a settlement; and a failure of the assured to fully comply with the provisions of this section shall release the company from all liability by reason of such accident, suit, or action.”
    On September 21, 1900, a passenger upon the railway was injured, brought suit, and recovered on May 2, 19.01, a judgment of $2,592 and costs of suit, taxed at $88.90. The defendant assumed the direct control of the defense in that suit. The railway company was satisfied with the judgment, and did not desire to appeal, but the casualty company insisted upon appealing to the Supreme Court. It was finally agreed to assign only such errors as would, if sustained by the Supreme Court, result in a reversal of the judgment without ordering a new trial. Upon an appeal to this court, taken at the instigation of the defendant, which paid all the expenses of the appeal, the judgment was affirmed February 11, 1902 (Richard v. Railway, 129 Mich. 458 [89 N. W. 52]), and costs taxed on February 20th at $73.50. On March 17, 1902, the judgment and the costs of both courts, and the accrued interest upon the judgment and costs, totaling $2,892, were paid by the railway company; plaintiff furnishing the money, and taking an assignment of the claim against the defendant. The defendant was soon thereafter notified of such payment, but asked for a certificate of the clerk of the court that the judgment had been paid, and by whom, and also asked for' a certified copy of the assignment to Mr. Stephens. These certificates were furnished April 4, ■ 1902.

      On March 19, 1902, the defendant was served with a writ of garnishment. Another writ was subsequently issued. Under these garnishee proceedings the defendant disclosed its liability to the amount of $2,500, and on July 7, 1902, an order was made, upon the motion of defendant, permitting it to pay $2,500 into court, under the provisions of the statute. This order was complied with July 7th, and a proper receipt taken from the clerk. There the fund remained until February 9, 1903, when the plaintiff gave a bond and received from the clerk of the court the $2,500, and the garnishment proceedings were discontinued. This suit was brought to recover the costs taxed in the Supreme Court, and interest thereon, and interest on the judgment from the date of its rendition. Under the direction of the court, the jury rendered a verdict for the amount claimed.

      Graves, Hatch & Millis, for appellant.

      Geer & Williams and H. JR. Martin, for appellee.
   Grant; J.

(after stating the facts), The main question arises upon the construction of the contract of indemnity. Plaintiff contends that the legal liability became adjusted and settled upon the rendition of the judgment in the circuit court. Defendant insists that the liability was not adjusted and settled until'the judgment was paid, or, if that be not so, until the final determination in the Supreme Court. The contention of the defendant upon the trial was that its liability was limited to $2,500, and that, having paid that amount into’court, its liability ended. This result would follow if its construction of the contract be sound.

We think that, under the terms of this contract, when a final judgment was rendered against the railway company, the liability under defendant’s contract became fixed, and it was obligated to pay the amount of the indemnity, although the judgment had not been paid. Under defendant’s claim, if the indemnitee were insolvent and never paid the judgment, the indemnitor would never be compelled to pay. This result would, of course, follow if the contract of indemnity required the indemnitee to be first damnified by payment, as was held in the case of Weller v. Eames, 15 Minn. 461(2 Am. Rep. 150), upon which the defendant largely relies. That case is distinguishable from the present and others like it. Weller, the plaintiff, was one of two defendants who were sued for the same cause of action. Weller alone obtained an indemnity bond. It might very well be held that in such case Weller might never be compelled to pay, as plaintiff might enforce his judgment against the other defendant. However that may be, the weight of authority seems to be.that contracts like that in this case are held to constitute an indemnity against liability for damages, and not merely indemnity against damages. In the former case payment is not essential, while in the latter it is. The authorities make a distinction between these two classes of indemnity. This distinction is very "cleaidy stated in Gilbert v. Wiman, 1 N. Y. 550 (49 Am. Dec. 359), wherein the court say:

“By the former [a contract to indemnify against liability], he [the indemnitee] is to be saved from the thing specified; by the latter [a contract to indemnify against loss or damage], from its consequences. * * * It is the distinction between an affirmative covenant for a specific thing, and one of indemnity against damage by reason of the nonperformance of the thing specified. The object of both may be to save the covenantee from damages, but their legal consequences to the parties are essentially different.”

See, also, 16 Am. & Eng. Enc. Law (2d Ed.), 178.

The following authorities hold that, under contracts of like character with the one in this case, a payment of the judgment is not essential to recovery: Pickett v. Casualty Co., 60 S. C. 477 (38 S. E. 160, 629); Fenton v. Casualty Co., 36 Or. 283 (56 Pac. 1096, 48 L. R. A. 770); Anoka Lumber Co. v. Casualty Co., 63 Minn. 286 (65 N. W. 353, 30 L. R. A. 689); Hoven v. Assurance Corp., 93 Wis. 201 (67 N. W. 46, 32 L. R. A. 388); McBeth v. McIntyre, 57 Cal. 49.

Which judgment fixed the time of liability, — the judgment in the circuit court, or the one in the Supreme Court ? By the terms of the contract, the defendant’s liability was limited to $2,500. It had the right to compromise and settle with the injured party, or, if it concluded that the railway company was not liable for negligence, it had the right to contest the suit. It was also contemplated by the contract that defendant might appeal the case to the Supreme Court. This right of appeal in the defendant was absolute. If the railway company had settled the case, after such appeal bad been taken, without the defendant’s consent or against its protest, the defendant would have been discharged from liability. American Surety Co. v. Ballman, 104 Fed. 634; Security Trust Co. v. Robb, 116 Fed. 201. This right, therefore, was given by the contract, and the loss or damage was not adjusted and settled until the determination of the case in this court. By that adjudication the defendant’s liability was adjusted and settled. Interest, therefore, can be charged only from February 11, 1902.

On March 19, 1902, the sheriff served a copy of a writ of garnishment upon certain parties claimed to be the agents of the defendant. At the request of the attorneys for Mr. Stephens, the attorneys for the defendant notified it that Mr. Stephens claimed that he had become the owner of the claim before commencement of the garnishee proceedings, and that the writ had not been served upon any one upon whom service of legal process could lawfully be made, and that Mr. Stephens would give the defendant a bond to its entire satisfaction if it would pay him the amount of its liability. There was no legal obligation on the part of the defendant to accept a bond and pay the money to the plaintiff. This offer, therefore, to furnish a bond, does not affect the rights of the parties. Defendant made no disclosure to the writ of garnishment. It appeared specially and moved to quash the proceedings because the writ had not been served, in accordance with the statute, upon the insurance commissioner, or upon its duly appointed agent. While this motion was pending, and on May 21,1902, another suit was commenced against the railway company, the plaintiff, and one Andrews, and a writ of garnishment issued to the defendant, charging it with being indebted to Mr. Stephens. This writ was served on the same day. On May 28, 1902, the garnishment proceedings in the former suit were discontinued. June 10, 1902, the defendant filed its disclosure in the last garnishment suit, admitting its liability of $2,500, and alleging that different parties claimed it. On June 13th following, an order was made impleading the different claimants, and on July 7th an order was made directing the defendant to pay the money into court, which it did on the same day. It is urged that these garnishee proceedings suspended the running of interest.

When these garnishee proceedings were commenced, the defendant’s obligation to pay had become fixed, and interest on the $2,500 had commenced to run. It might have paid the judgment before the commencement of the first garnishee suit. Many cases hold that the service of the writ of garnishment suspends the running of interest. In Massachusetts the cases hold that, where the debt bears interest by virtue of a contract creating it, the interest continues to run if the party continues to use the money due (Adams v. Cordis, 8 Pick. 260); but where it does not bear interest by virtue of a contract, but the law imposes interest for the unlawful detention of the debt, the service of the writ suspends the running of interest (Prescott v. Parker, 4 Mass. 170; President, etc., of Oriented Bank v. Insurance Co., 4 Metc. [Mass.] 1). We think that the statute (3 Comp. Laws, § 10627) controls this question of interest, and provides a speedy and ample remedy to a defendant in garnishment to avoid the running of interest. Under that statute, the defendant in garnishment may at once file his disclosure admitting his liability to the principal defendant, state that it is claimed by others than the principal defendant, pay the money into court, and thus relieve himself from liability for interest. When a party fails to avail himself of this statute, he should be held to pay the interest.

Is the defendant liable for costs in the Supreme Court ? Under the indemnity contract, both the indemnitor and the indemnitee had the right of appeal. The indemnitor could not have prevented the indemnitee from such an ■ appeal. The indemnitee could not refuse to take an appeal at the request of the indemnitor, except at the risk of discharging the indemnitor from liability. If either party desires to appeal, and the other does not, the real party appellant must pay the costs of the appeal. If both parties join in the appeal, each must bear, as between themselves, the proportionate share of the costs of such appeal. It follows that the defendant is liable for the costs of the appeal.

The judgment will be modified in accordance with this opinion. Defendant will recover the costs of this court.

Moore, Carpenter, and Montgomery, JJ., concurred. Hooker, C. J., took no part in the decision.


author: Moqre, J.

text:
    SHEEHAN v. FARWELL.
    1. Attorney and Client — Mortgages—Foreclosure—Redemption. . ’ •
    An attorney holding a mortgage second to that of his client violates no obligation to his client by redeeming after the foreclosure of his client's mortgage and his retirement from the case.
    2. Judgments — Canadian Courts — Conflict of Laws.
    Whether a judgment of a Canadian court affecting lands in Michigan is conclusive in a suit between the same parties in this State, — qucere.
    3. Mortgages — Redemption—Evidence.
    Evidence reviewed, and held to justify a decree for the redemption of lands from a mortgage.
    Appeal from Wayne; Rohnert, J.
    Submitted October 7, 1903.
    (Docket No. 5.)
    Decided December 22, 1903.
    Bill by Robert C. Sheehan against Jesse H. Farwell and Emer J. Farwell, impleaded with James A. Cook, special administrator of the estate of Calvin A. Cook, deceased, to compel the conveyance of certain real estate and for an accounting. From a decree for complainant, defendants appeal.
    Affirmed.

      Howard B. Bloomer {Alfred Lucking, of counsel), for complainant.

      F. H. & G. L. Canfield {Chamberlain & Guise, of counsel), for defendants.
   Moqre, J.

This is an appeal from a decree granting the relief prayed for in the bill of complaint. A reference to the case of Farwell v. Bigelow, 112 Mich. 285 (70 N. W. 579), will aid in understanding some of the questions presented in this record.

The bill of complaint is, in substance, as follows:

“That Calvin A. Cook, being indebted to Jesse H. Farwell in divers sums, and also accommodated by some indorsements, on the 29th day of September, 1891, gave a mortgage to Farwell covering lands in Wayne county and Montmorency county, Michigan, and afterwards, on the ■31st day of December, 1892, Cook gave Farwell another mortgage, to secure the same indebtedness, on lands in Essex county, Ontario; that on August 1, 1894, Farwell began a foreclosure on the Michigan lands in the Wayne ■circuit court, in chancery, making Cook defendant, and also the Bigelows and Rea, on account of certain levies subsequent to the mortgage; that in May, 1896, prior to the decree being taken in said chancery foreclosure, Far-well signed an agreement with Cook as follows:
“ ‘Sandwich, June 16,1896.
“ ‘For and in consideration of one dollar to me in hand and other valuable considerations from C. A. Cook, to wit, the signing of certain bills for expenses of foreclosing mortgages, etc., etc., in Michigan and Essex county, Ontario, I hereby agi;ee to foreclose mortgages which I hold against said Cook on lands in Michigan, U. S., and in Essex county, Ontario, and hold the lands for two years for sale; if not sold then, to sell same at best price obtainable, subject to the approval of said Cook, retaining from sales what is due me on mortgages, and pay over all balances to said Cook or whom he may appoint or direct.
[Signed] “ ‘Jesse H. Farwell.’
“ That on the 15th day of August, 1896, decree was granted by the Wayne circuit court fixing the amount due Farwell from Cook at $23,333, and ordering a sale of the lands in Wayne county and Montmorency county, Michigan ; that on July 22,1897, sale was had, and Farwell bid in the lands for $7,350; that those Michigan lands were worth $33,000; that on or before the 11th day of June, 1898, Far-well, in breach of the above-recited agreement, assumed to sell the lands in Essex county, Ontario, to his wife, Emer J. Farwell, for the sum of $25,000; that Farwell repudiated and denied the agreement of June 16, 1896, and denied all the rights of Cook in the Essex county lands and the Michigan lands.
“That on the 11th day of June, 1898, and prior thereto, Cook was a resident of Essex county, Ontario, and on that date he began suit in the high court of justice of the supreme court of judicature for Ontario against Farwell, and in his statement or bill of complaint set forth the substance of the facts hereinbefore set forth, and did pray relief as follows: To have Farwell declared trustee of the Michigan lands, and charging him with the value of the lands in the taking of the accounts between the parties, and that an accounting should be had between the parties, and that the defendant pay to the plaintiff whatever might be found to be the value of the Michigan lands over and above the indebtedness from Cook to Farwell, and that an order be made discharging the Ontario mortgage, made December 31, 1892, and releasing the Essex county lands to Cook, and for further and other relief, as the nature of the case required, and for costs of the action.
“The bill further alleges that service of process was duly had in said Canadian suit upon Jesse H. Farwell, and on the 8th day of September, 1898, he appeared by Patterson, Leggatt, Murphy & Sale, and filed his statement of defense or answer, wherein he admitted the mortgages referred to, denied the trustee agreement of June 16, 1896, set out above, admitted the sale of the Essex county lands to his wife, admitted he had bought the Michigan lands on foreclosure sale, and denied that Cook had any further interest either in the Ontario lands or the Michigan lands.
“ That said Canadian court is a court of record, and one competent to hear, try, and determine said matters so pleaded; that subsequently, on October 20, 1898, Farwell was examined by Cook’s solicitors before F. E. Marcon, deputy clerk of said court, each side appearing by counsel on said examination of Farwell, and Farwell was examined as a witness relative to the matters in issue, and his evidence was filed in said cause; that, after the said examination, Farwell admitted he held the lands as security only, and as trustee, and afterwards, on the 28th of October, 1898, an agreement was entered into in writing by which it was agreed that such Canadian suit should proceed to an accounting between Cook and Farwell, and that Farwell’s wife should retain the Essex county lands, and in such accounting Farwell should be charged therefor the sum of $25,000; also that Cook should be entitled to a conveyance of the Michigan lands upon payment of the balance found due from Cook on such accounting, provided the same were paid to said Farwell or into said court to the credit of said action within six months from the amount being ascertained on said accounting.
‘ ‘ The bill further alleges that, in pursuance of such agreement, on November 9th a preliminary order was entered in said suit postponing the trial, and referring it to the master to take the accounting; that subsequently the parties proceeded with such accounting from time to time until November 4, 1899, when the master’s report was filed in said cause, showing the items allowed and disallowed to the respective parties; that such proceedings were thereupon had in said action that afterwards, on the 8th day of June, 1900, upon the motion of defendant Far-well, a final judgment was entered in said cause (set forth in the bill) fixing the amount to be paid by Cook at $10,-224.77 as of the 4th day of June, 1900, and ordering the same paid into court within six months from the date of the judgment, whereupon the defendant was to transfer the Michigan lands back to Cook, or to such person as he might appoint.
‘ ‘ That, in pursuance thereof, Cook appointed the complainant, Robert C. Sheehan, to pay the moneys into court, Cook having, for a valuable consideration, transferred and conveyed all his interests in the Michigan lands to Sheehan; that Sheehan, in pursuance of said appointment and judgment, on the 7th day of December, 1900, paid the money into court as directed by said judgment, with the interest, which said sum has ever since remained to the credit of Farwell; that subsequent to the entry of judgment June 8, 1900, Cook discovered overcharges in the accounting on the part of Farwell, and on the 9th of November, 1900, filed a petition for correction thereof; that such proceedings were had thereupon that such corrections were made, and a new final judgment entered on the 12th day of June, 1901, by which the former judgment was recited, the corrections made, the amount finally due Farwell fixed at $9,308.16, reciting the appointment of Sheehan to receive the conveyance of the Michigan lands, and reciting the payment of the money into court, and the holding of the same to the credit of Farwell, and directing a transfer of the Michigan lands to complainant, Sheehan, and that Sheehan was entitled to the conveyance.
“That said Canadian judgment was rendered in said action after full litigation upon the merits, and that said court had full jurisdiction of the parties and such subject-matter, and that it remains in full force, not vacated or set aside; that said moneys still remain to the credit of Farwell, but that he has hitherto’ refused to withdraw the same, and refused to transfer the Michigan lands as directed by the judgment; that Farwell has been an invalid for a year or more, and inaccessible to complainant or his agents; that the son, George Farwell, who transacted his father’s business, refused even to be talked to concerning the matter. Complainant concludes by praying for an answer by the defendants, Jesse H. Farwell, Emer J. Farwell, and Calvin A. Cook, and for a conveyance of the Michigan lands, and that Jesse H. Farwell account for the rents, issues, and profits up to the time of the conveyance, and that the decree of the court stand as a conveyance, and for other and further relief.
“The answer of Jesse H. Farwell admits the allegations of the bill regarding the original indebtedness of Cook to Farwell, and the making of the mortgages, and the beginning of the foreclosure suit by Farwell in the Wayne circuit court. Says that he (Farwell)- has no recollection whatever of having signed or executed any such agreement as the one of June 16, 1896, but, according to the best of his knowledge and belief, denies the agreement. Admits the decree of the Wayne circuit court, the sale of the Michigan lands to himself under said decree as,alleged in the bill, and-the commissioner’s deed to himself. Denies that the sale was made pursuant to the alleged agreement of June 16, 1896. Denies the value of said lands to be $33,000. Admits ‘that he conveyed said Essex county lands to his wife for the nominal consideration of $25,000.’ Denies that said conveyance was in breach of any agreement between him and Cook. Denies that Cook has any rights in either the Essex county lands or the Michigan lands. Admits the beginning of the Canadian suit. Admits that Patterson, Leggatt, Murphy & Sale appeared for him in said suit, but says he has been an invalid, and has no personal knowledge as to what proceedings were had therein, and therefore leaves complainant to his proofs, and shows that, if any order or decree was made in said cause as alleged in the bill, the same was not only without jurisdiction, but, as he is informed and believes, was collusive, fraudulent, and void. Says that the court had no jurisdiction to render any such decree, and that it is therefore void. Admits that he has refused to make such conveyance. Admits that his son George has attended to some of his affairs; and prays the same benefit of the answer as if he had demurred.
“Defendant, in an amendment to the answer, denied the transfer from Cook to complainant, Sheehan, and states he is informed that complainant never paid Cook any consideration for a conveyance, and, upon further information, shows that complainant has no actual interest, and is merely a nominal party, and that the suit is being prosecuted on behalf of John L. Murphy, who was solicitor for this defendant in the Canadian suit, and that the conduct of Murphy in seeking to enforce the decree is inequitable and in fraud of defendant’s rights.
“The answer of Emer J. Farwell admits that she is the wife of Jesse H. Farwell, and in other respects is very similar to the answer of defendant Jesse H. Farwell.
“The answer of Calvin A. Cook was filed by his solicitor, in which he admits the allegations of the bill of complaint to be true. Calvin A. Cook died on the 19th day of June, 1902. . His administrator and heirs at law were substituted of record.”

Solicitors for defendants say:

“The case may be considered under the following heads:
“1. What effect is to be given to the Canadian judgment which is set up in complainant’s bill, to enforce which the bill was filed ?
“2. If that judgment is of any validity whatever, will this court enforce it, in favor of Murphy, under the peculiar circumstances disclosed in the record in this case ?
“3. Does the record show any ground, aside from the Canadian judgment, on which the present bill can be sustained ?
“A What effect is to be given to the agreement of June 16, 1896, which complainant alleges was signed by Mr. Farwell, and which we denounce as a forgery ?
“5. What effect is to be given to the agreements of October 28, 1898, either as sustaining the Canadian judgment or the decree of the court below ?
“6. Has Sheehan any right to redeem the Michigan lands, or enforce a conveyance thereof from Farwell, even if we admit that such a right existed on the part of Cook ?
“7. Of what effect has the Canadian judgment or said agreements on Mrs. Farwell’s interest in the Michigan lands ?”

Under the second head, counsel insist that Mr. Murphy is the real party complainant; that, when the Canadian judgment was rendered, he was a member of a legal firm that was acting for Mr. Farwell in the litigation; that he did not properly advise Mr. Farwell, or care for his interests ; that Mr. Farwell was kept in ignorance of what was being done; and that Mr. Murphy’s conduct has been such that this case ought to be dismissed. Mr. Murphy is criticised very bitterly by counsel, and we think without justification. It is true that Mr. Farwell has not for a long time been in good health. It is also true that, after Mr. Cook filed his bill in the Ontario court, the legal firm of which Mr. Murphy was a member was employed to look after Mr. Farwell’s interests. ' Mr. Farwell was a resident of Detroit. He employed a firm of Detroit lawyers to act in connection with the Ontario firm. Testimony was taken in the Ontario suit, including the testimony of Mr. Farwell, when it became manifest that it was wise to obtain a settlement with Mr. Oook, and negotiations were entered upon for that purpose. As a result of these negotiations, the following papers were signed:

“Cook & Farwell.
“Memo, of Agreement of Settlement.
“1. The sale of the Sandwich lands to. Mrs. Farwell to be confirmed and stand.
“2. The judgment herein to be for dismissal of the action, when this agreement has been made, except that an account be directed of the amounts advanced under the mortgages mentioned in the sixth paragraph of the statement of claim, and due for principal, interest, and costs thereon, after giving all proper credits. Such account to be taken before the master of this court at Windsor, and without a reference to the master in the suit. Should an adjournment be agreed to, then on consent.
“3. Each party to pay his own costs of this action.
“4. The defendant agrees and undertakes to convey the Michigan lands, free from incumbrances, to the plaintiff, or to whom he shall appoint, according to the result of such account, on payment of the amount found due on such account, provided the same be paid to him or into court to the credit of this action within six months from the amount being ascertained as aforesaid.
“5. In the event of nonpayment, the plaintiff-to have no further right as to any of the lands remaining tmsold, and default shall, to all intents and purposes, be as if he had been cut off and debarred by a valid decree of strict foreclosure.
“6. The portions of said lands sold by defendant, being the lot on 1.2th street, Detroit, and 40 acres in Montmorency Co., Michigan, to be allowed, and the sales to be approved and confirmed at the price at which they were sold. Plff. or his nominee to be allowed as part of this agreement to have W. -J- of lot 13, Bl. 79, "Woodbridge Farm, Detroit, at the price paid for same by Mr. Farwell, with interest at 6 per cent., and to buy same with the other lands above mentioned.
“ Dated 28th October, 1898.
“0. A. Cook.
“Patterson, Leggatt, Murphy & Sale,
‘ ‘ Solicitors for Deft.
“ Jerry G. Farwell,
“ For Jesse H. Farwell.
“Witness: Oct. 29th,’98.
“ Jno. Sale.”
“Sandwich, 28th October, 1898.
“ O. A. Cook & Jesse H. Farwell.
“In consideration of C. A. Cook having agreed to a certain settlement of the matters involved herein, dated today, and reserving an account of mortgage moneys, interest, and costs to plaintiff, it is agreed that defendant shall pay to plaintiff forthwith $500 cash in respect of his costs and disbursements. Defendant is to be at liberty to have trial of action adjourned till next court, instead of judgment for defendant, if he so desires, and judgment for defendant entered later, or at next sittings at Sandwich. The account mentioned in the agreement to be taken herein in the meantime, and the said agreement is to be considered part of this; neither party bound by previous admissions. Defendant is to sell to Cook or his assigns at the price fixed by the master. Each party pay his own costs of the reference. Above cash payment to be made on 29th October.
[Signed] “ C. A. Cook.
“Patterson, Leggatt, Murphy & Sale,
“ Solicitors for Deft.
“Jerry G. Farwell,
“For Jesse H. Farwell.”

After these papers were signed, the parties proceeded to an accounting before the master. Mr. Farwell himself made an affidavit November 16, 1898, showing what he claimed was the condition of the account. The master found there was due Mr. Farwell $198. In the hearing before the master, Jerry G. Farwell and George Farwell, men about 30 years old, sons of the defendants in this case, Mr. Farwell’s bookkeeper, and his Detroit lawyers were sworn as witnesses. Mr. Farwell, not being satisfied with the finding of the master, appealed to the judge. Upon that hearing a judgment of $10,224 was given in March, 1900, to Mr. Farwell, and George Farwell wrote from Detroit to the firm of which Mr. Murphy was a member that “the decision handed down in the Toronto court is very satisfactory indeed to us. ” Mr. Cook was not satisfied, and appealed to the high court of justice, in which court the action of the lower court was affirmed, and the case was remanded to the master to make the figures accordingly. In the meantime a legal firm in Toronto had been employed by Mr. Farwell to assist the other attorneys. May 19, 1900, George Farwell wrote Mr. Murphy’s firm, among other things, as follows:

“We wish to be very careful about the wording of this judgment as it is made by the master, and you will receive instructions from Laidlaw & Kappele in this respect. * * *
“Kappele & Bicknell will write you fully, and wish you would consult freely with them as to idea of wording of this judgment. We have given O’Conner his own way in some matters, and in this we must watch our interests closely, and have judgment rendered to suit our position as nearly as we can.”

On the same day Laidlaw, Kappele & Bicknell wrote Mr. Murphy’s firm, among other things, as follows:

“ The original judgment at the trial provides for further directions, and we do not see what further directions can be given other than those which are provided for in the agreement. This will involve a direction for payment into court of the amount found due, and for the conveyance of the Michigan lands on payment thereof within the limited time. ■ We do not see any way by which the money can be obtained out of court, except upon the conveyance of the Michigan lands; and, if we see that the conveyance of those lands is inevitable if the money is paid, we had better have the judgment provide for the absolute foreclosure of all interest of the plaintiff in the lands in the event of the money not being paid.”

The final order in the case followed the instructions of the Toronto lawyers. It was entered June 8, 1900. About this time Mr. Murphy and the Farwells had some trouble, about which the parties are not agreed, and Mr. Murphy’s firm ceased to act longer for Mr. Farwell. The money was paid into court December 7, 1900.

Mr. Murphy’s firm had a mortgage dated July 1, 1896, which was second to Farwell’s mortgage, on Cook’s Essex county lands, and it is Murphy’s claim he consented to Mrs. Farwell’s getting title to these lands upon Farwell’s promise to take care of the second mortgage. The Far-wells deny this. Murphy claims:

“As Farwell’s mortgages for the same debt covered both Michigan and Ontario lands, while Murphy’s second mortgage covered only the Ontario lands, Murphy, under well-settled equitable rules, had the right of redemption in the Michigan lands as well as in the Ontario lands. To enforce this right he took from Cook on the 3d day of July, 1900, a declaration recognizing this right of redemption of the Michigan lands, and then Murphy proceeded to make arrangements to assist to raise the money to pay off Far-well’s first mortgage. This was all done after the entry of the final judgment in favor of Farwell, and after Murphy had retired from the case and brought suit against Farwell for his services.”

There is nothing in the record to indicate that Mr. Murphy did anything he had no right to do.

Defendant Farwell claims the agreement of October 28, 1898, was not signed by him, was not authorized by him, and was not known to him, and that he should not be bound by it. In addition to what has already been stated, the record shows that, before this agreement was made, its terms were talked over at Mr. Farwell’s house, and one of the Detroit lawyers suggested a provision to be put into it. It is true, he says it was not signed by Mr. Farwell, and it was not, in his presence, consented to by him. It also appears that, at the time these papers were signed, a sum of money was to be paid to Mr. Cook. Mr. Farwell signed a check in blank, which was to be filled up and delivered to Mr. Cook by the son Jerry. It was so signed and delivered, and Jerry’s testimony is that he told his father what was done. We have no doubt, from what appears in the record, that Mr. Farwell authorized this agreement to be made, and was fully advised of all the steps taken in this litigation.

The remaining questions may be treated together. On the part of the complainant it is insisted the judgment of the Canadian court is conclusive, and should control here. Counsel say:

“Outside of New Jersey, all other courts, we believe, hold the judgment or decree to be conclusive as to all matters litigated, including the right to a conveyance or lease of the lands in the other States or countries. Dunlap v. Byers, 110 Mich. 113, 117 (67 N. W. 1067); 2 Black, Judgm. § 872; Burnley v. Stevenson, 24 Ohio St. 474 (15 Am. Rep. 621); Whart. Confl. Laws, § 288; Cheever v. Wilson, 9 Wall. 108; Noble v. Grandin, 125 Mich. 383 (84 N. W. 465). See, also, Ferguson v. Oliver, 99 Mich. 161 (58 N. W. 43, 41 Am. St. Rep. 593).”

They also cite a decree made in Canada to enforce a decree made in this court in the case of McGregor v. McGregor, 130 Mich. 505 (90 N. W. 284). In this case Falconbridge, C. J., speaking for the court, said:

‘ ‘ (1) An undivided half interest in the Windsor real estate is a partnership asset, and, on the winding up of the affairs of the partnership, the proceeds thereof are first applicable in discharge of the debts of the firm, and then of what may be due to the partners, respectively, after deducting what may be due from them as partners to the firm; i. e., the claims of one partner against the other on an accounting. 2 Lind. Partn. (5th Ed.) p. 352.
“ (2) Therefore it is liable to answer the amount which, under the judgments of the Michigan courts, will be payable to Thomas McGregor.
“(3) For the decree of the Supreme Court of Michigan should be held binding upon these parties in this court. The parties were all within the jurisdiction of the foreign court, and, as defendant John McGregor invoked and submitted to the jurisdiction of that court, he has precluded himself from setting up want of juris diction. Swaizie v. Swaizie, 31 Ont. 324. And, if any amendment be necessary, it will be granted.
“ (4) The Windsor real estate did not cease to be partnership property on the withdrawal of John McGregor, Sr., or at the death of Donald McGregor. The evidence does not show any agreement or other state of facts whereby there was any severance of the partnership interest of John and Thomas in the undivided one-half remaining.
“ (5) The deed to Elizabeth McGregor was given pendente lite, with full notice to her, and without consideration, and is bound by the judgment subjecting the conveyance to her to the lien of Thomas McGregor. Being admittedly voluntary and without consideration, it is also fraudulent and void against Thomas McGregor in respect of his lien on the partnership property, and also fraudulent and void against Thomas McGregor and other creditors of John McGregor in respect of the undivided interest of John McGregor not subject to the lien. Leave to plaintiffs to amend as to these two-twentieths by suing on behalf of themselves and all other creditors of John Mc-Gregor.
“ (6) The defendant Elizabeth McGregor is not entitled to dower, because the land is a partnership asset, and because she now holds the property in her own name; the conveyance being still good as between her and her husband. Judgment generally in favor of plaintiffs for partition or sale, with declarations in accordance with the above findings. Defendants John McGregor and Elizabeth McGregor to pay costs of action of plaintiffs and defendant Jane McBride.” McGregor v. McGregor, 2 Ont. Wky. R. 96.

It is also claimed that, irrespective of the Canadian judgment, complainant has made a case entitling him to the decree rendered in the court below.

On the part of the defendants it is insisted the Canadian court was without jurisdiction of the subject-matter, and its decree is void. It is said the effect of the decree of the Canadian court is to overrule the decree of this court in Farwell v. Bigelow, 112 Mich. 285 (70 N. W. 579). It is also said the judgment of the Canadian court in respect to the Michigan lands is not res judicata or binding, because it is not based upon any issue made by the pleadings; that especially is this true as to Mrs. Farwell, wrho was never a party to that suit. It is also urged that foreign judgments are^ impeachable for fraud, and that the Canadian judgment'was obtained by fraud. It is" also said Farwell is not estopped to deny the validity of the Canadian decree by reason of anything that took place after the settlement of October 28, 1898; that complainant is not entitled to recover, because he shows no title to the lands; that Mrs. Farwell cannot be deprived of her rights of dower in the Michigan lands by any agreement Mr. Farwell might make subsequent to the confirmation of the Michigan foreclosure sale, nor by the Canadian decree, as she was not made a party.

In our view of the case, it is not necessary to decide just how far we should go to enforce a decree made by a Canadian court affecting lands in Michigan. A consideration of the entire record convinces us that Mr. Farwell signed the agreement of June 16, 1896, and that the sale of the Michigan lands and the confirmation thereof were made, Mr. Cook expecting this agreement to be carried out; that later Mr. Farwell, ignoring this agreement, caused the Canadian lands to be sold to his wife for the nominal sum of $25,000, and that, after'this was done, he denied that Mr. Cook had any interest in either the Michigan or Canadian lands; that Mr. Cook then commenced the litigation as set out in the bill of complaint; that afterwards the agreement of October 28, 1898, was made, with Mr. Far-well’s knowledge and consent, and the proceedings resulting in a decree as before stated were subsequently had. The parties are now all before this court. The Michigan mortgage foreclosure; the agreement of June 16, 1896; the sale of the Michigan lands; the sale of the Essex county lands to Mrs. Farwell; the commencement of the litigation in the Canadian court by Mr. Cook against Mr. Farwell; the agreement of October 28, 1898, and the subsequent proceedings thereunder resulting in the decree in the Canadian court; the payment of money into court,— all grow out of the security, and the attempt to enforce it by Mr. Farwell, which was given to him by Mr. Cook upon the Canadian lands as well' as the Michigan lands. The record discloses that the complainant, by the act of Mr. Cook in writing, now occupies his place, and has succeeded to his rights. Mr. Cook was made a party defendant to this suit. He did not, nor does his representative since his death, question the right of complainant to a decree. Mrs. Farwell paid no money for her claimed rights of dower in the Michigan lands. By virtue of the agreement of October 28, 1898, and the subsequent proceedings thereunder, the dispute in relation to her title to the Essex county lands is ended. We think, by a strong preponderance of evidence, the complainant has established such a state of facts as to entitle him to the relief granted in the court below. See Weed v. Terry, 2 Doug. (Mich.) 344 (45 Am. Dec. 257); Id., Walk. Ch. 501; Farwell v. Johnston, 34 Mich. 342; Carmichael v. Carmichael, 72 Mich. 76 (40 N. W. 173, 1 L. R. A. 596, 16 Am. St. Rep. 528); Daniels v. Lewis, 16 Wis. 140; Paine v. Wilcox, Id. 202; Slingerland v. Slingerland, 39 Minn. 197 (39 N. W. 146).

The decree is affirmed, with costs.

Carpenter, Grant, and Montgomery, J J., concurred. Hooker, C. J., took no part in the decision.