text:
    WELCH v. BEECHING.
    1. Contracts — Payment—Threats.
    Where plaintiff brought suit against defendants to recover a payment alleged to have been made under threat of litigation for the debts of a banking copartnership, for which she was not liable, on account of coverture, testimony relating to the environment of the plaintiff, and that she supported herself and her children, whose number and age she described, was not improperly admitted.
    2. Same — Attorneys—Duress—Torts.
    An attorney for defendant, who started the action for equal share of the proceeds, was correctly made a party defendant and the court rightly declined to direct a verdict for him.
    S. Same — Definition—Contracts.
    Duress exists where one by the unlawful act of another is induced to make a contract or perform some act under circumstances which deprive him of the exercise of free will: it may be defined as an unlawful restraint, intimidation, or compulsion resulting in the doing of some act contrary to the will or inclination of the doer.
    4. Same — Good Faith — Coverture.
    And although defendant and his attorney may have supposed they were entitled to start the action, they were not excused from liability to a woman, away from home, sick or indisposed, threatened and informed by the lawyer that the law would be invoked against hex if she did not pay the claim, and who paid under the fear excited by the threats.
    Error to Van Burén; Des Voignes, J.
    Submitted June 14, 1916.
    (Docket No. 109.)
    Decided September 27, 1916.
    Assumpsit by Minnie E. Welch against Charles Beeching and Earl L. Burhans to recover a payment made under duress. Judgment for plaintiff. Defendants bring error.
    Affirmed.

      David Anderson and Wm. J. Barnard, for appellants.

      Glenn E. Warner, for appellee.
   Moore, J.

This action was begun in justice’s court, and an appeal was taken from the judgment there rendered. On the trial in the circuit court the circuit judge directed a verdict in favor of defendant Crankshaw, and the jury returned a verdict upon which judgment was entered in favor of plaintiff against defendants Beeching and Burhans in the sum of $150. The case is brought here by writ of error.

Before March, 1914, there was a bank known as the Farmers’ & Merchants’ Bank of. Lawrence, Mich. The members of the bank were Mrs. Angie Clark, James EL Baxter, James L. Welch, and Minnie E. Welch, the plaintiff in this case, who was the wife of James L. Welch. The plaintiff was not an active member of the company, and- had nothing to do with the management of the bank. March 30, 1914, a receiver for this bank was appointed.

Dr. Daune W. Crankshaw resided at Lawrence, Mich., and he desired to purchase a piece of land formerfy owned by James L. Welch, and Minnie E. Welch as tenants by the entireties, which had been conveyed to H. L. Thornburg. Mrs. Welch represented Mr. Thornburg in making the sale. She received the deed from Mr. Thornburg which she delivered to Dr. Crankshaw, and he submitted it to attorney Earl Burhans with the letter from Mr. Thornburg. Mr. Burhans learned from the letter that Dr. Crankshaw was purchasing the property for $800, of which $200 was to be loaned by Mr. Thornburg to Mrs. Welch. Mr. Burhans began in the circuit court an action wherein Charles Beeching was plaintiff and Minnie E. Welch defendant, and another suit against Dr. Crankshaw as garnishee defendant. Charles Beeching was an unsecured creditor of the Farmers’ & Merchants’ Bank.

After the papers in the suits were issued Mr. Burhans, who was prosecuting attorney, and the sheriff, went with the papers to Lawrence and to the office of Dr. Crankshaw. A conference was held in the private office of the doctor, after which the sheriff, in compliance with the request of Mr. Burhans, went to the home of Mrs. Welch and brought her in an automobile to the-office of Dr. Crankshaw. What occurred there according to the version of the plaintiff appears in her testimony, which was, in substance, as follows:

“I am the plaintiff in this case; am wife of James L. Welch, and at present am living in Indianapolis. My husband was a member of the banking house known as the Farmers’ & Merchants’ Bank of Lawrence. The members of that banking company were James L. Welch, J. H. Baxter, Angie L. Clark, and myself. I never had anything to do with the active management of the bank. The bank failed March 26, 1914. We moved to Indianapolis June, 1915. I was back in Lawrence in August, 1915, and negotiated the deal of this real estate to Dr. Crankshaw. Mr. Thorn-burg told me that I could sell the property for $1,000. I talked with Dr. Crankshaw about my circumstances and why I wanted the money, and I said: ‘If you will give me $1,000 for that property I am to have $200 for selling it.’ He told me to write Mr. Thorn-burg that he would give $800. I had arranged with Mr. Thornburg to get $200 for commission and borrow $200 of Mr. Thornburg, and I talked it over with the doctor, and decided that by selling it for the $800 and losing my $200 commission that it would put me in position to borrow $200. So I wrote Mr. Thornburg. After some negotiations it was agreed that Dr. Crankshaw could have this property from Mr. Thornburg for the $800; $200 to be paid in cash. On August 5th the doctor gave me $25 earnest money.
“Q. After the failure of this bank, tell the jury what you did to support yourself. * * *
“A. I nursed for Dr. Crowell whenever I could work. I took care of Mrs. Moon out in the country, and nursed at George Schafter’s, and nursed a case in Chicago.
“Q. As to the condition of your health on the 17th day of August and still prior to that time, had you been under the care of Dr. Crankshaw?
“A. I had.
“Q. And in your custody how many children did you have?
“A. Three.
“Q. How old are these children?
“A. One 17, one 14, and one 10. * * * I think school was going to open in Indianapolis August 27th. I wanted to get home as soon as I could as soon as this deal was put through, because I didn’t know whether the children had to register, and I wanted to get back as soon as I could to get ready for school. I saw Dr. Crankshaw at the post office on the morning of August 17th. He said Burhans was coming down and would bring down some papers, and said: ‘There is some little entanglement I don’t just understand what it is, but Burhans is coming down, and we will send for you when he gets here.’ I went back home, and later Mr. Beattie came to the house with an automobile, and I went to Crankshaw’s office with him. In the front room he introduced me to Dr. Emery and Mr. Beattie, and I sat down in the front office. In a few minutes Dr. Crankshaw asked me into the private office. In there Mr. Burhans explained the title to me, and I beeame a little nervous, and I said: ‘What am I to do, then, to get back tomorrow? I am not going to get the children to school.’ And Burhans, hitting the 'arm of the chair, he says he would advise Dr. Crankshaw not to put any good money into this until he gets some good paper. I said: ‘Well there is plenty of time to get that. Suppose you keep the remainder and pay me the balance of the $200, and then I can go, and the remainder can be sent When this is straightened up.’ Then Mr. Burhans said: ‘Mrs. Welch, I have something that is not pleasant to tell you now, and I don’t want you to get nervous.’ And then he stated that he had started a suit to tie this money up so that I couldn’t get it. And I said: ‘Why, how is that?’ * * * And I said: ‘Mr. Burhans, if you knew that this was taking this from my children’s mouths, the food that I need to feed them, would you take this just the same?’ And he said: ‘Mrs. Welch, there is also a little man out here in the country that has worked hard in the hot sun and tied up his money, and you have tied up his money in this bank over here.’ I asked him who, and he went on and explained quite a little bit before he told me.it was Mr. Beeching. Of course, I was frightened and I was very nervous—
“Q. Did you tell Mr. Burhans you were nervous?
“A. Well, they could see it. The doctor knew I was not well. I said: ‘Doctor’ — No; I said: ‘Well, then, if that is the case, let’s call the deal off, and I won’t try to sell it; let Thornburg attend to his own business.’ ‘No,’ he says, ‘you can’t do that; the doctor has bought it,1 paid $25 on it.’ And then I waited a minute, and. I said: ‘Doctor, would you loan me $25 ? I must go back, and you know I haven’t got any money; I told you so a little while ago.’ And doctor kind of said: ‘Y-e-s.’ And. Mr. Burhans then said: ‘Well now, Mrs. Welch, I would rather give to you $25 than to give it to the court, and you needn’t borrow that $25; if we can come to some negotiations here, we will pay you $25 of it.’
“Q. During that time did you say anything about fighting that case?
“A. I can’t tell just when I said it, but I did say: ‘If I was well I would fight this to a finish.’
“Q. Was anything said to you by Mr. Burhans about your liability for the debts in the bank?
“A. Yes; he said when he was tapping on the chair and talking to me, he said: ‘You are liable for the debts of this bank. You are a partner in this old firm and you are liable for its debts.’ Of course, I won’t dispute his word, but it seems to me that that was when I said to him: ‘Why, Mr. Burhans, do you mean to say that they can also take my wages from my work if I go out and nurse?’ And he explained that matter to me somewhere as he says he did.
“Q. Did you believe that statement and rely upon that statement that he made that you were liable for the debts of that firm?
“A. Well, I was so frightened I don’t know what I did think, hardly. I never had had. the sheriff or prosecuting attorney come after me before, and I was frightened.
“Q. Did you say anything further to him about declaring the deal off or about getting the children back to school?
“A. That was about all that was said, as I can remember about that. But he advised me that he was not my attorney, that he was against'me, and that I better get counsel.
“Q. Now, Mr. Burhans said that you told him that this was not the first one of these debts that you settled. Did you say anything like that?
“A. When I was leaving the office to go out the back door, and they had all said ‘Good bye’ to me, I said: ‘This is not the first debt that I have paid.’ I didn’t mean though in connection with , the bank. I meant personal debts, and I have paid every one to my knowledge. We have managed to pay all little debts by close managing, except a little grocery bill at Albert Abrams’, and he refused to take it. That is what I mean; I meant personal debts.
“Q. Now, do you recall anything further which was said or done there in Dr. Crankshaw’s office before these checks were turned over?
“A. Well, about the time it was proposed not to — ■ for to give me $25 there, Mr. Burhans said: ‘Get out your check book, Doc.’ And the doctor got out his check book, I remember that; but it seems to me that the checks were laid on the arm of my chair. We all sat right there, and it seems to me I wrote it right there. I can’t remember exactly. I was awfully excited and frightened. But I know that I signed those checks. They told me which one to sign or to hand to Mr. Burhans and which one for me to keep.
“Q. And all you received of the $175 was $25?
“A. Out of the $175; yes, sir.
“Q. Which way did you leave the office?
“A. Out the doctor’s back door.
“Q. Were you crying at the time, as the doctor testified?
“A. Yes, sir; I didn’t want to go out on the street.”

On the cross-examination she testified:

“Mr. Burhans some time in the proceedings said that he had something to say that was not pleasant, and told me that he had started a suit against me.
“Q. And he told you that he believed he had a right to hold the whole $800, didn’t he?
“A. Well, he said so much, and I was so excited I couldn’t tell you the exact words, but to that amount.
“Q. Didn’t he tell you he believed he had a right to hold the whole $800?
“A. Yes, sir; he did.
“Q. And that he believed that Mr. Thornburg really never was the owner of that property?
“A. And I told him that I had counsel from Mr. Cavanaugh that it was perfectly legal to sell the property before I sold it.
“Q. And did you tell him that you had counsel from somebody else?
“A. Yes; I think I did. I mentioned Judge Mills, because I did talk with Judge Mills about it.
“Q. And you told Mr. Burhans that you had counsel, and that you did have a right to sell it?
“A. Yes, sir; it was joint property. And I stated to him furthermore, I said: ‘Mr. Burhans, that was bought with the money that the old Stearns farm sold for, property that I had when I was a girl, the place where I lived when I was a girl.’
“Q. Well, the point is this: Mr. Burhans said that he thought he had a right to hold the whole $800, and you thought he didn’t have a right to hold it all?
“A. Yes, sir; I was indignant about it.
“Q. Isn’t it right then and there, when you was talking about the $800, that you said you would fight it, if you ever said this?
“A. I couldn’t say when it was. I couldn’t say positively, but I know I said it.
‘■‘Q. What would be your recollection as to whether or not it was not when he was talking about holding the whole $800?
“A. I said to him that this was not done with my own free will; if I was well I would fight it to a finish.
“Q. Now that is when he was talking about holding the $800?
“A. I can’t say now. I won’t say positively, but it would seem to me it was almost before I was leaving, and after — My memory is now that Mr. Beattie was in the room when I said that. I think Mr. Beattie was in the room when I said that. Now, I won’t say positively about that, because I can’t remember.
“Q. Well, anyway, you said that if you was well that you would fight the case?
“A. Yes, sir; I furthermore said — looked at the doctor and told him that he knew I was not well.
“Q. From that you meant that you didn’t believe that you were liable; is that a fact?
“A. I don’t know what I did believe now.
“Q. If you had been well, you would have fought the case?
“A. Yes, sir; I would.
“Q. On the ground that you were not liable?
“A. But I felt that I must get back to Indianapolis, and I had got to save my children.”

There was much more of her testimony than what we have quoted. Dr. Crankshaw and Mr. Burhans were called as witnesses by the plaintiff. There were other witnesses sworn. We have quoted from the testimony of the plaintiff because, if she is entitled to have her case go to the jury at all, it must be because of her testimony.

It is now agreed by all of the parties that, because plaintiff was a married woman, she is not liable to the creditors of the bank for its debts. It should be said that Mr. Burhans claims he supposed he had the right to commence the suits he did commence, and to make the statements he did make about the plaintiff being liable for the debts of the bank.

Errors relied upon are stated by counsel as follows:

(1) Permitting plaintiff to testify as to how she had supported herself and as to the number and ages of her children.

(2) The refusal of the court to direct a verdict in favor of Beeching, or Burhans, or both, as asked for at the close of plaintiff’s case.

(3) Refusal and failure to give defendants’ requests to charge the jury.

(4) Errors in the charge as given.

We will take these up in the order presented:

1. It will appear later in this qpinion that it is proper in these cases to show the environment of the person upon whom it is claimed duress has been practiced.

2. Mr. Burhans’ testimony shows that he arranged to take the claim of Mr. Beeching upon shares, each to have one-half of what was realized. If the case was to go to the jury at all it should be submitted against both of the remaining defendants.

The remaining assignments may be considered together.

The charge of the court was very long. In it appears the following:

“It is the claim of the plaintiff that she was induced to pay the sum of $150 by duress, and I instruct you that duress exists when one by the unlawful act of another is induced to make a contract or perform some act under circumstances which deprive him of the exercise of free will. Mere apprehension of threats of a civil proceeding or suit based on a summons and garnishment process in a civil proceeding to enforce a claim unaccompanied by any act of hardship or oppression does not render a payment in response thereto involuntary in the sense that it can be recovered back.
“The question in this case is not, Did Beeching have a claim he could enforce if the suit had gone forward? The question is, Did he, through Attorney Burhans, coerce Mrs. Welch; that is, put her under duress so she was not able to exercise her own free will and agency and thereby was the payment rendered involuntary? If she was not deprived of her free will and agency, then the payment was voluntary, and your verdict should be no cause of action. To constitute duress it is not necessary that physical force be used. Duress is either of the person or of the property of a party, and if you believe from the evidence that, although no force was used, yet if by unlawful acts Mrs. Welch was induced to pay over the money under circumstances which deprived her of the exercise of free will, then I instruct you that the same was such duress as entitles her to maintain this action. In determining the question of duress, sex, age, state of health, and financial condition of the plaintiff should be considered. You have a right to inquire, Is the plaintiff strong and robust or nervous and irritable, and what effect, if any, did that have? Was she under all the circumstances in that condition of mind whereby she exercised a voluntary volition, free, and not under the coercion of others.
“The plaintiff in this case claims that the money involved was paid by her to Mr. Burhans under what is known in the law as duress; that is, the circumstances were such that she was not acting voluntarily and of her own free will in paying over this money to Burhans on the claim asserted against her.
“I instruct you, gentlemen, that if a claim is presented against a person, and that person voluntarily pays the claim, the money cannot be recovered back simply on the ground that it could not have been legally enforced had the person seen fit to contest the matter rather than pay it. So in this case, if Mrs. Welch saw fit to pay or settle this claim as she did rather than have a lawsuit, or in preference to the notoriety and publicity which would follow a contest, and that she was acting free and of her own volition, then she cannot recover it back, and your verdict should be for the defendant.
"If you find from the evidence that the defendant Burhans did not do anything or say anything which tended to frighten Mrs. Welch or give her cause to think that her person was in danger, or that her property or rights were in danger, but if, on the other hand, he only told her he had a claim for Mr. Beeching and had started a suit thereon, and would have a summons served on her and garnishment served on Dr. Crankshaw, and if he did not urge her to pay or to make settlement, but, on the contrary, told her he could not advise her, and that there was no hurry in the matter, and she had better take time and get counsel and advice, and she paid the money rather than take time and get counsel or to avoid notoriety and publicity, or the trouble and expense of a lawsuit, then she cannot claim to have been coerced, or that the payment was involuntary, and your verdict must be for the defendant. * * *
"The plaintiff has the burden in this case of satisfying you by a preponderance of the evidence of the elements of her claim. In arriving at the question whether the plaintiff has established her case by a preponderance of the evidence, you are not confined to evidence introduced on either side of the case. You may rely upon any evidence in the case; it matters not which party introduced it if it is sufficient to satisfy you of the fact and so proven by a preponderance of the evidence. * * *
“As I have just said to you, gentlemen, this is purely a question of fact, as it is now presented, and may be determined in these few words: Finally the question here is one of fact, namely, under the evidence, if Mrs. Welch exercised a free, agency in what she did in the doctor’s office when the check for $150 was signed by her in the office of Dr. Crankshaw whereby the money went to defendant, if she had an opportunity to consider the matter, was advised of her rights, and knew and understood what she could do, and then chose the course taken as a result of a free agency, of her own volition, of her own free will, then plaintiff cannot recover, and you will return a verdict in favor of the defendant of no cause of action.
“Upon the other hand, gentlemen, if you find under the evidence there was a want of free agency, in what Mrs. Welch did in the doctor’s office when the check for $150 was signed by her whereby the money went to defendant, she having no opportunity to consider the matter, that she was not advised of her rights, and did not know or understand her rights, and as a result she was deprived of a free agency, and the act done was not the exercise of a free volition, her own free will, then plaintiff is entitled to recover, and you will so say by your verdict.”

The law of duress has been gradually undergoing modifications. In a recent work discussing the modern doctrine it is said:

“According to this view, what constitutes duress is matter of law; whether duress existed in the particular transaction is usually matter of fact, though, of course, the means may be so oppressive as to render the result an inference of law. There is no legal standard of resistance with which the person acted upon must comply at the peril of being remediless for a wrong done to him, and no general rule as to the sufficiency of facts to produce duress. The question in each case is: Was the person so acted upon by threats of the person claiming the benefit of the contract for the purpose of obtaining such contract as to be bereft of the quality of mind essential to the making of a contract, and was the contract thereby obtained? Under this theory duress is to be tested, not by the nature of the threats, but rather by the state of mind induced thereby in the victim. The means used to produce that condition, the age, sex, state of health, and mental characteristics of the alleged injured party, are all evidentiary, merely, of the ultimate fact in issue, of whether such person was bereft of the free exercise of his will power. _ Obviously what will accomplish this result cannot justly be tested by any other standard than that of the particular person acted upon. His resisting power, under all the circumstances of the situation, and not any arbitrary standard, is to be considered in determining whether there was duress.” 9 R. C. L. p. 716.

It is said:

“Duress exists where one by the unlawful act of another is induced to make a contract or perform some act under circumstances which deprive him of the exercise of free will. City National Bank v. Kusworm, 91 Wis. 166 (64 N. W. 843, 845); Wolff v. Bluhm, 95 Wis. 257 (70 N. W. 73, 74, 60 Am. St. Rep. 115); Batavian Bank v. North, 114 Wis. 637 (90 N. W. 1016, 1019); Philipps v. Henry, 160 Pa. 24 (28 Atl. 477, 478, 40 Am. St. Rep. 706); Peabody v. Tenney, 18 R. I. 498 (30 Atl. 456, 457); Newburyport Water Co. v. City of Newburyport (C. C.), 103 Fed. 584, 594; Hackley v. Headley, 45 Mich. 569 (8 N. W. 511, 512). It may be defined as an unlawful restraint, intimidation, or compulsion of another to such an extent and degree as to induce such person to do or perform some act which he is not legally bound to do, contrary to his will and inclination. It is obvious that if the act is done contrary to the will and inclination of the injured party it cannot be in the exercise of his free will. His will is subjected to that of another, and he is compelled to submit to an illegal exaction because of the dominant power. First National Bank v. Sargeant, 65 Neb. 594 (91 N. W. 595, 597, 59 L. R. A. 296)." 3 Words and Phrases, p. 2268.

Again:

“ ‘Duress,’ under the decisions, means a condition of mind produced by improper external pressure or influence that practically destroys the free agency of a party, and causes him to do an act or make a contract, not of his own volition, but under such wrongful external pressure. Whether such external pressure or influence is sufficient to destroy the free agency of a party is a question to be determined by the age, sex, intelligence, experience, and force of will of the party, the nature of the act, and all the attendant facts and circumstances. Pride v. Baker (Tenn. Ch. App.), 64 S. W. 329, 332 (citing Willard v. Willard, 65 Tenn. (6 Baxt.) 297 (32 Am. Rep. 529).” 3 Words and Phrases, p. 2269.

In Hackley v. Headley, 45 Mich. 569 (8 N. W. 511), Justice Cooley, speaking for. the court, said;

“Duress exists when one by the unlawful act of another is induced to make a contract or perform some act under circumstances which deprive him of the exercise of free will. * * *
"And the mere threat to employ colorable legal authority to compel payment of an unfounded claim is such duress as will support an action to recover back what is paid under it. Beckwith v. Frisbie, 32 Vt. 559; Adams v. Reeves, 68 N. C. 134 [12 Am. Rep. 627]; Briggs v. Lewiston, 29 Me. 472; Grim v. School District, 57 Pa. 433 [98 Am. Dec. 237] ; First National Bank v. Watkins, 21 Mich. 483.”

See, also, Cribbs v. Sowle, 87 Mich. 340 (49 N. W. 587, 24 Am. St. Rep. 166), and Bentley v. Robson, 117 Mich. 691 (76 N. W. 146); Foote v. De Poy, 126 Iowa, 366 (102 N. W. 112, 68 L. R. A. 302, 106 Am. St. Rep. 365).

We have not overlooked Beath v. Chapoton, 115 Mich. 506 (73 N. W. 806, 69 Am. St. Rep. 589), and Voorhees v. Nelson, 189 Mich. 684 (155 N. W. 708), but in these cases legal authority was not used to enforce an unfounded claim.

We have in the instant case a woman away from home, confronted with an unexpected situation, told by a lawyer that the law could be successfully invoked and would be invoked against her unless the money was paid. It is now admitted that, however honestly these statements may have been made, they were not true. The woman says she was sick, nervous, and frightened, and did not know what to do.

Under the authorities cited we do not think the trial judge could dispose of the question as a matter of law, but that he properly submitted it to the jury.

Judgment is affirmed, with costs to the plaintiff.

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


source: Caselaw Access Project

author: Brooke, J.

license: Public Domain

text:
    SHERRARD v. MURPHY.
    1. Vendor and Purchaser — Injunction—Building Restrictions —Breach of Covenant.
    The owners of Fox Creek subdivision in Detroit sold to a purchaser by land contract one lot, upon the restriction that buildings should face an avenue named, not nearer than 20 feet from the front line, and prohibiting open drainage; also, that no building should cost less than $2,000. The assignee of the contract undertook to erect a structure of less than the value agreed upon, and complainants filed their bill to enjoin the breach of covenant. In part of the subdivision covered by the restrictions some building had been done of which only a small proportion complied with the covenants in the conveyances. This condition for the most part existed when the defendants purchased. Held, that the owners could make the restrictions a condition of any sale, and did not lose their rights because former buyers had violated the covenants.
    2. Same — Covenants—Estoppel.
    As to a successor in title of the contract purchaser, the vendors were not estopped by any acts done before the contract was executed.
    3. Same — Building Restrictions — Estoppel.
    The vendors, who still owned several lots, in the subdivision, could enjoin the erection of the building proposed by defendant, where the other purchasers had not substantially changed the character of the residence district and the prior violations were only temporary; the court finding that the restriction was still valuable to the grantors.
    Appeal from Wayne; Hally, J.
    Submitted June 14, 1916.
    (Docket No. 93.)
    Decided September 27, 1916.
    Bill by Charlotte B. Sherrard and others against Thomas Murphy and Catherine Woods for an injunction. From a decree for complainants, defendant Murphy appeals.
    Modified and affirmed.

      Angelí, Bodman & Turner, for complainants.

      Bishop & Kilpatrick, for defendants.
   Brooke, J.

Plaintiffs in this cause are owners of Fox Creek subdivision in the city of Detroit. Lot No. 484 of said subdivision was sold to a Mr. Gannon under a land contract dated February 15, 1911. The restrictive clause contained in said contract was as follows:

“The said party of the second part further expressly covenants with the said parties of the first part, and it is a further condition of this conveyance, that all buildings erected or placed on said property shall face Ashland avenue and shall not be nearer than twenty (20) feet to the front line of said avenue; that no building so erected or placed shall cost less than two thousand dollars ($2,000.00); that there shall be no direct or open drainage from any building of any character on said property into Fox Creek, and that said party of the second part, her heirs and assigns, shall not do anything to impair, obstruct or in any way interfere with the flow and free use of Fox Creek as a common waterway by the owners of the lots in Fox Creek subdivision, nor with the- improvement thereof for the purpose of navigation.”

On November 16, 1911, Gannon, with the consent of the vendors, assigned his contract to Thomas Woods. On May 22, 1912, Thomas Woods by an independent contract, which did not contain the restrictive clause, sold lot No. 484 to the defendant Thomas Murphy. No notice of the sale by Woods to Murphy was given plaintiffs, and later, the full consideration having been paid plaintiffs, a deed was executed by them to Catherine Woods, mother and sole heir at law of Thomas Woods, deceased, dated April 10,1915. This deed contained the same restrictive covenant which had been inserted in the Gannon contract, and which is quoted above. Later Mr. Woods conveyed said lot to the defendant without restrictions. Defendant having undertaken to erect a structure on the back end of the lot here in quéstion of the value of from $500 to $700, plaintiffs filed their bill of complaint to enjoin the erection of said building.

It was the contention of the defendant in the court below, and he makes the same contention here, that the plaintiffs by their acquiescence in repeated breaches of the restrictive clause should now be held to have estopped themselves from insisting upon its observance by the defendant. This contention is based upon the following situation: We quote from the opinion of the learned circuit judge:

“In that part of the subdivision covered by the restrictions above enumerated, that is, those that pertained so expressly to Fox Creek, there are 60 lots. There lots have been built upon over a period of about five or six years. Most of the building was done previous to the recent season and before the institution of these proceedings. It appeared in testimony that since Mr. Murphy got possession of the lot from Mr. Wood that the general aspect of the place has changed but little. There are, all told, 33 structures upon these 60 lots. Of these 33 structures, 4 of them comply with the restrictions that have been enumerated; 10 of these structures are residences the year around; 4 are exclusive boathouses; 6 have no accommodations for boats at all; and 13 are designed to receive boats and to house people. Of the 33 structures, 29 are built facing Fox Creek and only 4 are built facing Ashland avenue. The structures are of all characters, one and two story, even some flats or buildings that are used by more than one family. The vast majority of them are very modest structures — many of them would be called ‘shacks.’ The defendant’s is intended for a residence and is being erected on the rear of the lot facing Fox Creek. It will cost about $700. Before the defendant got his deed he was apprised of the restrictions.”

It should perhaps be added that the 60 lots mentioned in the excerpt above all lie between Ashland avenue and Fox Creek. There are, of course, an equal number of lots on the west side of Ashland avenue besides one or two other parallel streets running from Jefferson avenue to the lake in the same subdivision, all of which may be said to be in some measure influenced for good or ill by the observance, or failure to observe, the restrictive clause in question.

There can be no doubt that upon many, perhaps nearly one-half, of the 60 lots lying between Ashland avenue and Fox Creek violations of this clause have occurred. The structures so violating the restriction are for the most part erected upon the rear end of the lots along Fox Creek, and are used for boathouses or summer dwellings, the same structure sometimes being used for both purposes. This use of the lots in question appears to have been made by the owners and suffered by the vendors at a time when Ashland avenue was unpaved and without sewer or water. The street is now paved and has both sewer and water, and its later developments on both sides appear to be in harmony with the restrictive clause.

It- seems quite certain that many, perhaps most, of the structures abutting on Fox Creek are either temporary in character or designed for use as boathouses, thus leaving the front of each lot free for the fulfillment of the restriction when built upon.

The record fails to show that the complainants, with a single exception, have permitted any breach of the restrictive clause under contracts or deeds issued since the Gannon contract was made. The exception noted involves the lot adjoining that owned by defendant, the owner of which was permitted to erect a small structure upon the rear end under an agreement to comply with the restriction within two years. While upon the stand defendant refused to enter into a similar agreement.

It is asserted by plaintiffs, and with this assertion we agree, that if the lots upon which the buildings which offend the restrictive clause had been sold either with or without restriction and those buildings erected thereon prior to the sale of the lot in question to Gannon, it would still have been competent for plaintiffs to have lawfully restricted the use which Gannon should make of his lot. This defendant may urge as estoppel only such acts or omissions on the part of the plaintiffs affecting the restrictive clause as have occurred since the making of the Gannon contract which is the basis of his title. Reilly v. Otto, 108 Mich. 330 (66 N. W. 228).

We have no doubt that the restriction, considering the number of lots still owned by plaintiffs in the subdivision, is one of value to them, and we are not convinced that the breaches thereof which have occurred will ultimately operate as an entire or even substantial change in the neighborhood, as it would have been had the restrictive clause been observed.

Under such circumstances relief should be granted. Misch v. Lehman, 178 Mich. 225 (144 N. W. 556). The decree enjoining the erection of the proposed structure at the present time is therefore affirmed. The right of defendant to erect any suitable building upon the rear end of the lot after compliance with the restrictive clause as to the erection upon the front of the lot does not appear to be questioned.

The decree will be modified in this particular and, as so modified, will stand affirmed, with costs.

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


author: Steere, J.

text:
    THOMAS v. ROSECRANTZ.
    False Imprisonment — Process—Affidavit—Capias ad Respondendum.
    Where the son of plaintiff, in a negligence case for the killing of two horses, made an affidavit for a capias ad respondendum, under 3 Comp. Laws, § 9999 (re-enacted, Judicature Act, 3 Comp. Laws 1915, § 12416), which was found to be technically defective, but set up facts showing a sufficient cause of action, and where the defendant after-wards brought an action for false imprisonment, the writ was a good defense, the affiant having and showing personal knowledge of the facts, though failing to allege the ownership of the team.
    Error to Calhoun; North, J.
    Submitted June 14, 1916.
    (Docket No. 90.)
    Decided September 27, 1916.
    Case by Emmerson E. Thomas against Ralph Rosecrantz and Erva J. Mallory for false imprisonment. Judgment for defendants on a directed verdict. Plaintiff brings error.
    Affirmed.

      James M. Powers, for appellant.

      Robert H. Kirschman, Clyde Cortright, and A. F. Cooper, for appellees.
   Steere, J.

Plaintiff brought this action to recover damages for false imprisonment from defendants whom he charges as responsible for his unlawful arrest on October 29, 1915, at the city of Battle Creek, on a defective writ of capias ad respondendum issued out of and under the seal of the circuit court of Calhoun county, in an action for tort commenced against him by one Ransom W. Rosecrantz. Before said writ issued the circuit judge of Calhoun county indorsed an order that defendant Thomas, plaintiff herein, be held to bail in the sum of $500. Attached to the writ was an affidavit made by defendant Ralph Rosecrantz as agent for said Ransom W. Rosecrantz. Defendant Mallory was sheriff of Calhoun county and served the writ.

On November 12, 1915, Thomas moved the circuit court of Calhoun county for an order quashing the writ and discharging him from custody, on the ground that the affidavit upon which the order to hold to bail was made was not sufficient. The motion was argued and granted upon the same day it was made and Thomas was discharged from custody, but the case against him was allowed to proceed under the summons clause of the writ. Following his discharge from custody Thomas commenced this action for false imprisonment against defendant Ralph Rosecrantz, who made the affidavit, and defendant Mallory, the sheriff who arrested him. Defendants pleaded the general issue and gave notice of justification under the writ.

The case was brought on to be heard March 22, 1916, and after the testimony of plaintiff had been taken in part, it being conceded that the capias and affidavit in question were 'the only authority under which defendants sought to justify, it was agreed that the case should be first submitted to the court upon these legal questions, reserving the right to take further testimony if the question of damages was reached. After argument upon the questions submitted, counsel for defendant asked for a directed verdict of no cause of action, and plaintiff’s counsel for a directed verdict in his favor, and that the question of damages be submitted to the jury.

The view and reasons of the trial court in holding that the process, though defective, afforded protection from liability for false imprisonment is thus concisely stated in its charge directing a verdict for defendants:

“While there was a technical defect in the affidavit upon which the writ of capias was issued, still the process of the court was sufficiently regular in my judgment to protect the sheriff and also to protect the other defendant who made the affidavit and at whose instance the writ was issued. As soon as the defect in the process was called to the attention of the court the defendant was released from custody. The subject-matter of that suit in my judgment was one over which the court had jurisdiction; it was a proper suit and a proper situation in which to apply for a writ of capias and to cause the same to be issued and served as the commencement of suit, and the fact that it was subsequently made to appear to the court that the affidavit upon which the capias was issued was technically defective would not render the party who applied for the writ or the sheriff who executed the writ liable for damages in such a suit as is now pending in this court.”

The. subject-matter of that suit (Rosecrantz v. Thomas), as appears in the affidavit found by the court technically defective, is in brief that on October 23, 1915, while operating his automobile along a public highway of the county at night, without sufficient lights or sounding any warning of his approach, Thomas ran into affiant (Ralph Rosecrantz), who was lawfully traveling with a team and wagon along and on the proper side of the highway, throwing him from the wagon and frightening the horses he was driving so that they became unmanageable and broke away from him, running to and upon,the right of way of the Michigan Traction Company, where both were killed by coming in contact with its electric rail, by reason of which “said plaintiff has a claim for damages against the defendant named in the annexed writ,” etc. While deposing that he was agent of said Ransom W. Rosecrantz, plaintiff, in whose behalf he made the affidavit, and that he had personal knowledge of the facts and circumstances, affiant refrained from disclosing, unless by inference, that said plaintiff in whose behalf he made the affidavit owned or had any interest in the horses whose death was imputed to the tort of Thomas.

The exact grounds upon which the trial court held this affidavit insufficient are not shown, but those stated in Thomas’ motion to quash the writ and discharge him from custody are that “no sufficient facts are set forth in the affidavit annexed to said writ, to authorize the issuing of said writ, and the arrest and holding to bail of said defendant”; that it does not “set forth any facts or circumstances showing, or tending to show, that the said plaintiff suffered any damage or injury whatever to his person or property by reason of the acts complained of as set forth in said affidavit,” nor “the nature of the plaintiff’s claim for damages.” While the affidavit is rather meager in detail and in-artistically framed, the facts set out are upon personal knowledge, and in outline disclose actionable misconduct on the part of Thomas with a perhaps too remote inference that Ransom W. Rosecrantz was the victim. So far as facts were stated, it presented a situation, as stated by the trial court, indicating a cause of action proper to be commenced by capias. It was found “technically defective,” and the writ, upon Thomas’ application, was quashed, as a warrant, releasing him from arrest, but not free from liability in the action, which was allowed to stand under the summons clause. In that action the court had, and retained, jurisdiction of both the person and subject-matter.

It is contended in behalf of plaintiff that the affidavit annexed to the writ under which he was arrested gave the circuit judge no jurisdiction to indorse the order to hold to bail, that the order being beyond his jurisdiction the writ was invalid and void, furnished no protection to any one causing or participating in the arrest, therefore defendant’s liability for falsely imprisoning Mm inevitably follows as a matter of law, and the court should have so instructed the jury.

Although various other authorities are cited in support of this contention, it is said and particularly urged in plaintiff’s brief that this ease is controlled by the decision of this court in Wachsmuth v. Bank, 96 Mich. 426 (56 N. W. 9, 21 L. R. A. 278). While it is contended for defendants that the well-recognized distinction between the special and limited jurisdiction of a justice or commissioner and that of a judge of a court of general jurisdiction renders the Wachsmuth Case and others of like import in which the warrant emanated from an officer of limited or special jurisdiction inapplicable here; and that, on the other hand, Johnson v. Morton, 94 Mich. 1 (53 N. W. 816), in which the capias was authorized by a circuit judge, applies and is controlling.

Section 9998, 3 Comp. Laws (3 Comp. Laws 1915, § 12415), authorizes commencement by capias of personal actions not arising out of contract relations, where an order for bail, directing the amount, is indorsed on the writ “by a judge of the court from which the writ issues, or a circuit court commissioner.” Section 9999 (3 Comp. Laws 1915, § 12416) provides :

“Such order shall be made only upon the affidavit of the plaintiff, or some person in his behalf, showing the nature of the plaintiff’s claim, and such affidavit shall be annexed to, and returned and filed with the writ, and the defendant shall be held to bail in the amount specified in such order; and the court into which such writ is returnable may, on motion of either party, diminish or increase the amount for which bail shall be so ordered.”

In the Wachsmuth Case, supra, affirming a judgment for false imprisonment, it is pointed out that the order to hold to bail in the sum of $2,000 was indorsed by a circuit court commissioner on an affidavit which on its face affirmatively showed no right of action. Of this the court said:

“The officer indorsing the order was one of special and limited jurisdiction. * * * So far from setting forth any facts and circumstances tending to show grounds for granting the order, the affidavit expressly negatived any liability whatever to the plaintiff. The defect was therefore jurisdictional, and the order was absolutely void,” etc.

In the Johnson Case, supra, also an action for false imprisonment, plaintiff had been arrested upon a writ of capias, indorsed by the circuit judge with an order to hold to bail, and a motion to quash the writ on the ground that the affidavit was insufficient was denied, but on application to this court a mandamus was issued directing that the writ be vacated and the proceedings quashed, following which plaintiff brought an action of trespass for false imprisonment against the party making the affidavit. It was held, even though the writ had been vacated and proceedings quashed, the order to hold to bail made by the circuit judge protected the party applying for the writ. Of the affidavit this court said (speaking through Chief Justice McGrath, who also wrote the opinion in the Wachsmuth Case):

“It is evident that this affidavit lacks in detaü and in certainty, and for that reason it is insufficient; but it cannot be said that it sets forth no facts or circumstances indicating fraud or breach of trust,”—

which was the tort charged.

Holding that thé affidavit had a legal tendency to make out a case inasmuch as the facts and circumstances indicated fraud and breach of trust, the court said in conclusion:

“The determination of the judge must-be held to have all the qualities of a judicial decision, and as such protects the judge, the officer, and the party.”

Even under the test of limited and special jurisdiction contended for by plaintiff, the affidavit complained of here, as before pointed out, stated the essentials of a tort action, to the personal knowledge of affiant who deposed that he acted as agent of plaintiff, who by reason of said tort had a claim against the tort-feasor for the described misconduct. Even though slight and inconclusive it cannot be said that there was such a total absence of evidence upon the fact that the judge who indorsed the order, from whose court the writ must issue, and was vested with a degree, at least, of discretionary power, might not from the affidavit considered in its entirety draw a reasonable and legitimate inference that plaintiff owned or was interested in the property shown to have been injured by the stated tort, even though in a direct proceeding to set aside the capias the affidavit was of such scant weight, uncertain and lacking in details as to render the order allowing an arrest erroneous.

“In stating the cause of action, the affidavit will be sufficient if it disclose in clear and intelligible language the circumstances which gave rise to the subject of complaint with sufficient distinctness to enable the judge, in the exercise of his discretion, to collect from it that the plaintiff has been damnified, and in such a manner that if untruly stated the deponent may be indicted for perjury, although the affidavit might have been framed in more formal terms.” Bennett v. Benson, 25 N. J. Law, 166.

In Forbes v. Hyde, 31 Cal. 342, discussing the question of want of jurisdiction by reason of defective affidavit, the court said:

“There is a marked distinction between an affidavit which presents some evidence on the vital point, but clearly of a character too unsatisfactory to justify an order for publication of summons based upon it, and an affidavit which presents no evidence at all tending to prove the essential fact. In the former case the judge might be satisfied upon very slender and inconclusive testimony; but there being some appreciable evidence of a legal character, which calls into action the judgment of the judge, he has jurisdiction to consider and pass upon it.”

But beyond this, we are unable to discover that the doctrine announced by this court in the early case of Ward v. Cozzens, 3 Mich. 252, has ever been directly questioned or overruled in subsequent decisions. Plaintiff there brought an action for false imprisonment against defendant for causing his arrest upon a capias claimed void owing to insufficiency of the affidavit on which the order allowing it to issue was based. The order was made by a judge of the United States Circuit Court for the District of Michigan. Of such courts it was said that they—

“are courts of limited but not inferior jurisdiction. Their limitation applies to the persons of the parties and the subject-matter of the action. When, therefore, these come within their jurisdiction, they stand upon the same footing of all other superior courts of general common-law jurisdiction. * * * A capias ad respondendum, is a process of that court. But it is insisted that the affidavit did not disclose such a state of facts as authorized the making of the order. If that be so, the judge erred. It was a matter submitted to his judgment, he acted upon it, and made the order.”

In concluding the opinion the following general rule was stated:

“All the authorities are very clear, that a judge of a court of record cannot be held responsible for any acts done by him in his official capacity, and they are equally clear, that in no instance can his-orders, judgments, or decrees be treated as nullities” (citing numerous cases to which others might now be added). “The foregoing authorities establish this proposition, that in all cases where the parties act within the power and scope of an order of the superior court, without reference to their jurisdiction, and of an inferior court, when having jurisdiction, they are protected. The same immunities that are extended to the members of the respective courts are extended to the parties.”

For the foregoing reasons the judgment of the trial court is affirmed.

Moore, Brooke, and Person, JJ., concurred with Steere, J.

Stone, C. J., and Kuhn, Ostrander, and Bird, JJ., concurred in the result.


text:
    WHITTEMORE v. WALTER.
    1. Malicious Prosecution — Advice of Prosecuting Attorney— Chattel Mortgage.
    In an action for malicious prosecution, in which plaintiff declared against the defendant for wrongfully causing plaintiff’s arrest under a criminal charge for fraudulently disposing of hogs mortgaged to plaintiff, the general charge of the court that the advice of counsel, followed in good faith, after a full and fair statement of all the material facts, is a defense to an action for malicious prosecution, though the facts so stated do not justify the advice given, and that if the defendant went to the prosecuting attorney and made a full and fair statement of all the material facts in the case, and the prosecuting attorney advised him that he had a right to make complaint against plaintiff for disposing of the chattel mortgage property under the statute, and defendant, in good faith, followed the advice of counsel, that would be an absolute defense, but it would not be such defense if the statement was not full and fair, the court sufficiently covered a request that in placing the facts before the prosecuting attorney defendant was not required to be the judge of what was material and necessary and was only required to state the case as he fairly understood it, etc.

      2. Same — Evidence—Instructions to Jury.
    It was not error to admit evidence competent for one purpose and incompetent for another under instructions as to extent, the manner and limitations under which it could be considered. And, hence, where it was claimed by plaintiff that he had defendant’s permission to sell the hogs in question and apply the proceeds on the chattel mortgage, the testimony was admissible on the question of intent, if not for the purpose of showing a variation in the terms of the mortgage, and the jury were properly instructed to consider it for the one purpose, only.
    3. Same — Evidence—Directed Verdict.

      Held, also, that the trial court did not err in submitting to the jury the claim of plaintiff that he had permission to sell the animals when they became fit to market.
    Error to Shiawassee; Miner, J.
    Submitted June 20, 1916.
    (Docket No. 46.)
    Decided September 27, 1916.
    Case by Ira H. Whittemore against Lewis Walter for malicious prosecution. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      A. L. Chandler and E. F. Wilson, for appellant.

      George G. Hunter and William M. Smith, for appellee.
   Steere, J.

Plaintiff obtained a verdict and judgment for $200 against defendant in an action for malicious prosecution arising from the latter having made complaint and caused plaintiff’s arrest under a criminal charge of fraudulently disposing of five hogs covered by a chattel mortgage he had given defendant, with intent to injure and defraud.

On November 21, 1914, defendant, Walter, who was the tenant on a farm in Saginaw county owned by a Mr. Hoffman, sold to plaintiff, Whittemore, a half interest in certain live stock, tools, hay, grain, ensilage, etc., located on the Hoffman farm, surrendering to Whittemore possession of the property and premises with the approval of Hoffman who owned the other half of the personal property and accepted plaintiff as tenant in lieu of Walter. The personal property was inventoried, and a purchase price agreed upon between the parties of $1,459 for Walter’s half interest, upon which Whittemore then paid $500 down, giving for the deferred balance three notes for $150 each serially payable in four, seven and' ten months, and one for $500 payable in twelve months, amounting to $959, secured by a chattel mortgage upon the personal property so purchased, signed by Whittemore and his wife.

Plaintiff claimed and testified that at the time the $500 cash was paid and papers given an estimate was made by Walter as to the amount of ensilage and hay, and conditionally accepted and agreed upon in closing the deal, with the express understanding that the same would be shortly after measured by them, and if the estimate proved too large Whittemore should be credited with the difference, or, if short, the difference should be “added to what he owed Walter; that pursuant to this agreement he and Walter, in the presence of Hoffman, who owned the other half, measured the ensilage and hay, finding that they had been overestimated, and it was then and there agreed on that account that there was due Whittemore for the over estimate $41.25, which he in the presence of Hoffman requested, and defendant agreed, should be indorsed on his first note. He also claims, and introduced oral testimony, against objection, that although all the hogs on the place were included with the personal property covered .by the chattel mortgage as well as the food for stock then there, it was talked, understood, and expressly agreed between the parties that he had the right to feed the animals with the supply of food on hand and to sell the hogs when sufficiently aged and properly fattened.

Walter admits that he gave plaintiff the right to feed the ensilage, corn, hay, etc., to the stock, and that it was the understanding he should have the right to sell the stuff then covered by the mortgage when fit for sale “if it was applied on the mortgage,” and, while there was nothing said about the hogs, he supposed such right would apply to them when fit to sell. Asked in regard to Whittemore’s claimed agreement relative to the $41.25 deduction for hay and ensilage, he answered, “I will say I don’t remember of any such thing,” and when asked if that was as strong as he would put it, answered, “Yes,” positively denying, however, that he ever said it was all right and he would indorse it on the note. Of this Hoffman, who was present when the hay and ensilage were measured, testifies:

“The figures showed that Whittemore had paid $41.25 too much and I mentioned the fact. They seemed to agree to that, and Mr. Walter pulled out his pocketbook, saying: T will pay you now,’ to which Mr. Whittemore replied, ‘No; indorse that on the first note. I have got five hogs here in the fattening pen. They will be ready to go soon, and when they are ready, I will take them away, and it will save me hunting you up.’ ”

Included amongst the hogs listed in the chattel mortgage were “eight black and white shoats six months old.” In December plaintiff sold five of these shoats for $66.96, paying $33.48 to Hoffman, who owned the half interest in them, but kept the other half of the money received, telling Walter, however, that he had sold them.

Whittemore claimed that after taking possession of the premises he discovered several things were not as represented; that a mare included in the sale at $150, and warranted by Walter as sound, proved unsound, and that the ages of other horses had been misrepresented to him; also that a large hog included in the sale was taken away to the butcher by Walter, and not accounted for. He made complaint of this, and some friction arose between the parties, with claims and counterclaims between them the details of which need not be gone over here, and on January 7, 1915, defendant wrote Whittemore demanding the money he-had sold the hogs for, concluding:

“Now, if you want to save trouble you had better attend the same.”

On January 27, 1915, Walter, having obtained from the prosecuting attorney of Saginaw county an order for a warrant, swore to a complaint before a justice of the peace of said county charging Whittemore with having in December, 1914, sold five hogs of the value of $66.95 covered by a chattel mortgage given by him to complainant, “fraudulently disposing of the same, with intent to injure and defraud the said Lewis Walter out of the value of the same within the meaning of section 11619, 3 Comp. Laws (3 Comp. Laws 1915, § 15383),” etc. On this complaint a criminal warrant was placed in the hands of the sheriff of Saginaw county, who went to the Hoffman farm and arrested Whittemore, taking him to Saginaw, where he was detained in jail for a short time. From the jail he communicated with counsel over the phone and arranged for bail, after which he was taken before the justice and released on bail in the sum of $1,000 for his subsequent appearance, on February 4, 1915; Hoffman, who was owner of the farm and supervisor of the township where it was located, going upon his bond.

At this time all the property covered by the chattel mortgage except the five hogs was on the farm where Whittemore resided, none of the notes given by him for deferred payments were due, and the $41.25 for which he claimed an agreed credit should have been indorsed on the first note given amounted to more than he had received for his half of the hogs sold. On February 4, 1915, the day set for examination, the prosecuting attorney of Saginaw county directed that said case be nolle prossed, and plaintiff was thereupon discharged from custody without preliminary examination or trial.

Defendant’s various assignments of error include refusal of the court to direct a verdict for the defense, numerous alleged errors in the admission and rejection of testimony, denial of certain requests to charge, and erroneous instructions in the charge as given.

Early in his charge the court concisely advised the jury that to recover plaintiff must establish by a preponderance of evidence:

“First. That the prosecution was begun and came to a legal termination in plaintiff’s favor.
“Second. That defendant instituted the prosecution without probable cause. .
“Third. That in doing it, he was actuated by malicious motives.”

The first proposition was undisputed, and the remaining two involved the issues of fact for their consideration. These propositions were plainly repeated and elaborated in. subsequent portions'of the charge directing the attention of the jury to and emphasizing just what questions were for them to decide.

It is strenuously contended that defendant acted in good faith under advice of the prosecuting attorney after laying the facts of the case before him and the court committed reversible error in not giving the following request:

“In placing the facts before the prosecuting attorney for his action and advice, Lewis Walter was not required to be the judge of what was material and necessary to be stated and was required only to state the case as he fairly understood it, and if he did this and fairly and truthfully answered the questions asked by the prosecuting attorney, and then took such course in the matter as the prosecuting attorney advised, then defendant was not guilty of malicious prosecution.” •

Defendant’s testimony on direct examination was, in outline, that he truthfully stated the facts of the case to the prosecutor, answered all questions asked, and submitted the matter to him; that the prosecutor whose directions he followed gave him an order for a warrant; that when he made the complaint he honestly believed Whittemore had committed the offense charged, had no intent to hurt him, and only wanted the “security left good,” later consenting to let it drop when told by the prosecuting attorney Whittemore admitted he had no right to sell the property, and would not sell any more. On cross-examination he admitted that he did not disclose to the prosecuting attorney their differences touching the amount of hay, ensilage, etc., the large hog, the warranty of the horses, the $41.25 or other matters under which Whittemore claimed the right to sell the five hogs and retain the proceeds. Of this interview and advice given by him the prosecuting attorney testified, amongst other things:

“I asked him whether there had been any deals or arrangements between them so that their relations had been changed at all from what it was when the chattel mortgage was made out, and he said there had not been; the chattel mortgage was still in effect as it was. * * * And I stated to Mr. Walter that if what he had told me was the fact, that these hogs were covered by this chattel mortgage, and this man had sold them without permission and had kept the money, that that was an offense under the law, and that I would give him an order for a warrant under that statement of facts, and I wrote out the order there on the table and handed it to Mr. Walter and told him where the justice’s court was.”

Upon this branch of the case the court told the jury, in part:

“You have heard the version of that conversation given by the defendant and by the prosecuting attorney. That was given for two purposes: For the purpose of showing whether the defendant at the time he made the complaint was actuated by malice; and whether or not he was governed in the matter entirely by the advice and counsel of the prosecuting attorney. So in this case I charge you that the advice of counsel followed in good faith after a full and fair statement of all the material facts in the case is a defense to an action for malicious prosecution, though the facts as stated to counsel do not justify the advice given. * * * If you find in this case that the defendant went to the prosecuting attorney of Saginaw county, and made a full and fair statement of all the material facts in the case, and the prosecuting attorney advised him that he had a right to make a complaint against the plaintiff here for disposing of chattel mortgage property, under the statute, and plaintiff (defendant) in good faith followed that advice and counsel, then that would be an absolute defense, but if you should find in this case that the defendant did not make a full and fair statement of all the material facts in the case to the prosecuting attorney, then that would not be a defense.”

We think the subject was fairly and sufficiently covered by the general charge. Peterson v. Toner, 80 Mich. 350 (45 N. W. 346); Webster v. Fowler, 89 Mich. 303 (50 N. W. 1074); Harris v. Woodford, 98 Mich. 147 (57 N. W. 96).

Several of defendant’s assignments of error relate to a line of testimony admitted in which Whittemore and his wife testified to an understanding and agreement between the parties prior to and at the time of the execution of the chattel mortgage that the hogs could be sold by Whittemore whenever fattened and in proper condition for market. All such testimony was earnestly objected to as in violation of the primary rule that parol evidence is not admissible to vary the plain provisions of a written instrument. In offering this evidence plaintiff’s counsel admitted its incompetency to vary the terms of the chattel mortgage, and expressly stated its purpose was to negative criminal intent or purpose on the part of Whittemore to injure or defraud defendant. The court admitted it for that purpose, and instructed the jury in relation to it:

“If he had wanted to dispose of any of the property, it was his legal duty to have obtained the written consent of the defendant in this case; but you remember that in this case there was some evidence given upon the part of the plaintiff and his wife of some talk about disposing of the property previous to the signing of the contract. That evidence was not permitted for the purpose of showing that the plaintiff here had the right to dispose of the property, but for the purpose of showing the understanding of the persons at the time. If the plaintiff in this case, at that time, after he had signed that, honestly believed that he had the right to dispose of those hogs without the written consent of the defendant, then, if he disposed of them, he would not be guilty of having fraudulently disposed of them.”

It is an elementary rule that evidence competent for one purpose and incompetent for another should be admitted and in jury cases instruction given in what manner, to what extent, and for what purpose only it may be taken into consideration. The bare fact that plaintiff sold the five hogs covered by the mortgage as shown and admitted, while perhaps raising a presumption, was by no means conclusive of his guilt. The criminal gist of the offense was that in doing so he intended to injure or defraud defendant. Even if this testimony by plaintiff were incompetent, defendant’s own testimony on the same subject would tend to relieve its admission of serious importance, for he testified also to an understanding that plaintiff “was to have the right to sell the stuff that was there, that was covered, when it was fit for sale * * * if it was applied upon the mortgage,” and later, after testifying that nothing was said about the hogs, in reply to the question,

“Q. It was your idea, if he sold these hogs or any other property like that, I don’t mean tools, but I mean the hogs and the calves, if they were fit for market, that he would have the right to sell them providing he would come and bring the money and apply it on the notes,”

answered, “The hogs is all.” His indicated grievance appears to have been not that plaintiff sold the five hogs, but that the proceeds from their sale were not applied upon the mortgage, while Whittemore’s claim is that such application was, in effect, made under their agreement that in lieu of the same the $41.25 due him from defendant should be credited on the first of the notes which the mortgage secured, which defendant denied. This presented a material and important issue of fact.

If plaintiff’s claim was false, the jury might well find that there was probable cause to believe that he sold these hogs covered by the mortgage and kept the proceeds with a fraudulent intent under the statute to injure and defraud defendant, fully justifying the latter in swearing out a criminal warrant against him, while, if it was true, they could with propriety find that no reasonable grounds existed for such belief, and defendant was moved to such course by some ulterior motive, actuated only by ill will or malice. With such a material issue of fact presented by the testimony it seems unnecessary to further discuss the contention that a verdict should have been directed for defendant.

We find no reversible error in the admission or rejection of testimony upon the issues of this case as outlined by the record, from which the pleadings have been omitted, and are led to the conclusion that the court in a fair and logical charge clearly explained to the jury the well-settled principles of law applicable to the controversy, and plainly directed their attention to the material questions of fact submitted for their determination, with alternate rulings adapted to their permissible action in deciding the disputed facts.

We find no reason for disturbing the result, and the judgment will stand affirmed.

Stone, C. J., and Kuhn, Ostrander, Bird, Moore, Brooke, and Person, JJ., concurred.


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    TRAVELERS’ INDEMNITY CO. v. DETROIT UNITED RAILWAY.
    1. Street Railways — Crossing Accident — Automobiles.
    Where the driver of an automobile testified that he started to cross defendant’s street car track three- or four hundred feet ahead of a street car, believing that he had ample time in which to cross, and the motorman disputed the statement, there was evidence to take the case to the jury, and the trial court properly declined to direct a verdict for claimed contributory negligence of the driver.
    2. Same — Negligence—Due Care.
    The chauffeur was entitled to assume that the motorman would observe reasonable vigilance according to conditions, and it was his duty to have the car under such control as to admit of stopping it as soon as he could discern objects on the track.
    3. Same — Collisions.
    Mutual care to avoid collisions is demanded and to be expected; and both parties on a busy street in a city were entitled to use their own method of travel and required to avoid accidents by the use of all reasonable precaution.

      4. Same — Witnesses—Evidence.
    A witness who had formerly been in defendant’s employ as a conductor and run cars for nine or ten years, being familiar with the method of operating them and stopping cars under disadvantageous conditions, was qualified to express an opinion on the subject by hypothetical question and answer.
    Error to Wayne; Mandell, J.
    Submitted June 7, 1916.
    (Docket No. 30.)
    Decided September 27, 1916.
    Case by Travelers’ Indemnity Company, as assignee of one Gustav W. Zanger, against the Detroit United Railway for damages done to the automobile of plaintiff’s assignor. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Corliss, Leete & Moody (Fm. G. Fitzpatrick, of counsel), for appellant.

      Fred L. Vandeveer and Orville H. Foster, Jr., for appellee.
   Steere, J.

In this action, begun in justice’s court, and on appeal retried in the circuit court of Wayne county, plaintiff recovered a verdict and judgment of $200 for damages done to an automobile belonging to one Zanger, plaintiff’s assignor, when struck by one of defendant’s south-bound street cars on Broadway, in the city of Detroit, between east Grand River and Gratiot avenues, in the early evening of January 12, 1913.

The assignments of error upon which defendant relies are refusal of the court to direct a verdict in its favor because of contributory negligence, submitting the case to. the jury under a charge which permitted them to find the street car was negligently operated, and admitting testimony of a witness named Fish as to the distance in which the street car could be stopped.

No testimony was introduced by defendant. Plaintiff’s testimony showed that the injured automobile belonged to Zanger and was being driven by his chauffeur, who had come to take him home from his place of business at 36 Broadway, east side, and, finding no parking room upon that side, was crossing the street, along which defendant’s double tracks extended, to the opposite side, where he could find room to wait until Zanger came out to go home. It had been raining and the evening was misty, with the light fading at that time.

Ochs, the chauffeur, testified that he then had his lights lit and drove slowly north down the east side looking for a place to park, and, finding it necessary to cross over on account of cars being parked all along that side, watched his chance, until he saw a southbound street car pass, and, observing the next was coming south about a block and a half away, 300 or 400 feet beyond the first street north, and thinking he had plenty of time to get over, turned his automobile to the left to cross, driving slowly upon first speed, and just as he was about to cross the west track on which south-bound cars run this street car from the north struck his left rear wheel, violently throwing him around into another automobile, resulting in serious damage to the one he was driving, which he described in detail.

A witness named Kays, a draughtsman in the employ of the Edison Illuminating Company, with offices farther north on Broadway, testified that he was then on his way home and saw the accident. The first thing he remembered in that connection was noticing the chauffeur of the automobile, which was either stopped or running very slowly, approaching the car tracks, “look north and south on Broadway, and then start to cross the track.” This witness also stated that there was then a trolley car coming “within about 40 or 50 feet or more than that,” but subsequently explained that he was on the sidewalk just to the north of where the accident occurred, going south with his back towards the approaching trolley car, and first saw it when the front end got opposite where he was and within about 6 or 8 feet of the automobile; that he did not take notice of what the motorman was doing before the accident or until he stopped his car, which ran between 90 and 100 feet after striking the automobile, but he was familiar with the noise cars make in stopping — the grinding of the brakes, etc. — and heard no such noise previous to the time the street car struck the automobile; that he would judge the street car was going at least 15 miles an hour when the accident occurred.

The chauffeur’s negligence was clearly a question for the jury. He testified that he was looking for a chance to cross, and availed himself of a time when there was no approaching car within the block, near the center of which he crossed; that he saw the car, which hit his left hind wheel, when it was 300 or 400 feet beyond the first street north, and thought he had plenty of time to get over ahead of it, while Kays, whose back was towards the approaching car, confirms his claim that he took note of the situation and looked both ways as the automobile was about to cross the tracks. This is not a case of failing to look and see the approaching car, but of reasonable judgment and prudence in attempting to cross after seeing it. If it was reasonable for him to believe he could cross safely, he was not negligent in attempting it. Provided the car was as far away as he testified, it would have to travel at an unusual rate of speed to catch him, and in forming a judgment he had a right to assume that a reasonable degree of. care according to conditions would be observed by the motorman also. If by reason of the misty evening and fading light it was more difficult for the motorman to observe clearly plaintiff’s position and readily discover whether or not he had cleared the track, it was his duty “to have the car under such control as to admit of its being stopped after he became able to discern objects on the track, and before a collision with such objects should occur.” La Pontney v. Cartage Co., 116 Mich. 514 (74 N. W. 712).

Mutual care to avoid collisions was demanded and to be expected. Both parties were driving on a business street in a large city, which both had a right to use for their particular method of travel, but each in driving his conveyance was' required to exercise all reasonable care and take precautions to avoid injuring others. Their duties were mutual. The questions of negligence and contributory negligence were questions of fact, properly left to the jury within the rule of the following cases: Garrity v. Railway Co., 112 Mich. 369 (70 N. W. 1018, 37 L. R. A. 529); Ryan v. Railway Co., 123 Mich. 597 (82 N. W. 278); Moran v. Railway, 124 Mich. 582 (83 N. W. 606); Chauvin v. Railway, 135 Mich. 85 (97 N. W. 160); Gaffka v. Railway, 143 Mich. 456 (106 N. W. 1121); La Londe v. Traction Co., 145 Mich. 77 (108 N. W. 365); McQuisten v. Railway Co., 147 Mich. 67 (110 N. W. 118); Deitsch v. Traction Co., 155 Mich. 15 (118 N. W. 489); Clark v. Traction Co., 167 Mich. 694 (133 N. W. 927).

It is urged that testimony of the witness Fish as to the distance in which such a car might be stopped was inadmissible because the hypothetical question asked him did not contain sufficient controlling conditions, nor was there evidence as to the actual rate of speed of the trolley car which struck the automobile, and the witness did not properly qualify as an expert, never having worked as a motorman or operated a car. He had formerly been in defendant’s employ as a conductor, for nine or ten years, and ran as such on cars of the type of this one. He testified that in such capacity he was familiar by observation with the method of operating them, and had seen them make stops on rainy days when the tracks were wet, and had knowledge of the distance in which trolley cars could be stopped, and at the speed the witness Kays testified this car, as described, was running — about 15 miles an hour or a little more — it could be stopped in from 50 to 70 feet on a wet or drizzly day.

We think the witness sufficiently qualified as having especial experience and knowledge entitling him to give opinion testimony on the facts stated in the hypothetical question asked, and that sufficient material facts based on the evidence were embodied in the question to render it permissible. His answer was admissible for the jury to give such weight as they deemed it entitled to.

Finding no reversible error in this record, the judgment stands affirmed.

Stone, C. J., and Kuhn, Ostrander, Bird, Moore, Brooke, and Person, JJ., concurred.


text:
    DE HOOP v. PENINSULAR LIFE INSURANCE CO.
    1. Sales — Stock—Corporations—Agency.
    Evidence, in a suit for the amount paid upon a sale or subscription of corporate stock which, was converted to the use of the defendant’s agent, who solicited the subscription, defendant refusing to issue the stock or refund the payment, and claiming that before the stock was subscribed for it withdrew the same from the market, that the agent’s authority terminated with the taking effect of the “blue sky law,” and that the plaintiff was estopped by delay in presenting the certificate, held, to present an issue for the jury whether the letter terminating the agent’s authority was ever delivered, and as to the estoppel charged.
    2. Same — Estoppel—Ratification—Sale op Stock.
    The trial court did not err in declining to direct a verdict for the defendant on the ground that the so-called “blue sky law,” Act No. 143, Pub. Acts 1913, required the agent to register, and he failed to comply with it, since he was a de facto agent and the sale was not unlawful as to a corporation which had accepted the benefits of the transaction; especially in view of the cases holding the act of 1913 unconstitutional.
    Error to Ottawa; Brown, J., presiding.
    Submitted June 23, 1916.
    (Docket No. 112.)
    Decided September 27, 1916.
    Assumpsit by George De Hoop against the Peninsular Life Insurance Company for the recovery of money paid for stock in defendant corporation which was never delivered to plaintiff. Judgment for plaintiff. Defendant brings error.
    Affirmed.

      Walters & Hicks, for appellant.

      Louis H. Osterhous, for appellee.
   Steere, J.

Plaintiff recovered a verdict and judgment against defendant in the circuit court of Ottawa county for $750 (with interest), being the amount which he had paid on January 22, 1914, to F. E. Brown, a former stock salesman and insurance solicitor of defendant, for ten shares of its capital stock.

Plaintiff was a farmer living in the township of Zeeland, in said county, where Brown called and first solicited him to buy some stock in the Peninsular Life Insurance Company, defendant, during the summer of 1913. Brown then was, and had been since January, 1909, agent of defendant, authorized to sell its stock. Plaintiff did not then yield to the solicitation, but was apparently a promising prospect, and Brown’s efforts were ultimately successful, the deal for the shares of stock at $75 per share being finally consummated on the date stated, at which time plaintiff paid the $750 to Brown, by check, signing one of defendant’s forms of application for stock with which Brown was supplied, a duplicate of which was given him by Brown, signed by himself as agent. The check given in payment, drawn on the Zeeland State Bank, was later cashed by Brown and charged up to plaintiff.

Brown had sold 10 shares of defendant’s, stock to an acquaintance of plaintiff named Haitsema, living in the same township, having first solicited him in March, 1912, but finally closed the deal with him in December, 1913, giving him a countersigned duplicate of his application, as he did to plaintiff, telling him it would be some months before the stock could be issued, but the application was just as good as the certificate of stock, as he could hold it a year and then get his money back with six per cent, if he wished to, requesting him to so advise plaintiff, which was done. Brown subsequently became a defaulter and absconded.

Defendant thereafter refused to recognize the transaction, either by issuing the stock or refunding the money plaintiff had paid Brown for it, denying that Brown was then its agent, and this action was brought to recover the amount so paid.

Plaintiff declared upon the common counts in assumpsit, with an added count outlining the circumstances of his purchase of the stock, including his demands and defendant’s refusal.

Defendant pleaded the general issue with special notice that when the so-called blue sky law of 1913 went into effect, on September 10th of that year, defendant withdrew its treasury stock from sale, “and thereafter did not at any time authorize any dealer, and especially F. E. Brown, to sell or offer for sale any of its said treasury stock, or to receive or accept subscriptions therefor from the said plaintiff or any other person,” etc., and as a further matter of defense, without waiving the preceding, that plaintiff did not in any manner notify defendant he had paid or applied for any of its stock until January 15, 1915, prior to which time “said F. E. Brown had ceased to be an employee of defendant company for any purpose whatsoever, and had become a fugitive from justice, and this defendant after diligent inquiry and investigation, has been unable to ascertain his whereabouts.” By reason whereof it is asserted plaintiff became estopped from maintaining this action.

Upon the trial it was shown conclusively by admissions of defendant’s president and its records that Brown was in defendant’s employ as its authorized agent, with power to sell its stock, from January, 1909, until some time in October, 1913, and from February 22, 1914, to about January 4, 1915, when he absconded, but it is claimed that on account of the blue sky law going into effect at about that time his authority was revoked, in October, 1913, by a letter from the president telling him- to sell no more stock until further notice, and he was not authorized to again act as its agent until some time after the sale in question was made.

Under the contention that a verdict should have been directed in its favor, defendant’s counsel only pointed out in their brief assignments of error 3 and 4 as those urged and relied upon, which involve the two questions:

“First. Was Brown the agent of the defendant for the purpose of selling stock, at any time between approximately the middle of October, 1913, and approximately the 20th of February, 1914?
“Second. Was the agency of Brown terminated, as a matter of law, by the going into effect, on or about the 10th day of September, A. D. 1913, of Act 143 of the Public Acts of Michigan of 1913 — the Blue Sky Law, so called?”

From the undisputed evidence in this case it appears that the Peninsular Life Insurance Company, defendant, was planned, promoted, and organized by John C. Bobinson, who became its president and general manager. He testified that after several years’ experience as agent selling insurance for various companies he conceived the idea of himself forming an insurance company, and this company was the result. He organized it in 1908 with an authorized capital of $150,000, divided into 3,000 shares with a par valuation of $50 each. At the first meeting of the organizers he got together 13 members, including himself, 40 or 50 shares of stock then having been subscribed for, and he was authorized to sell the remainder of the stock under some contract arrangement with the company, or its members. As it was necessary to deposit $100,000 in cash or bonds with the State insurance department before the company could engage in the business for which it was organized, Bobinson’s efforts were first directed to selling sufficient stock to raise that amount, which took towards three years, but was finally accomplished, when the company qualified and was licensed to engage in the business of writing insurance some time during April, 1911. In January, 1909, Bobinson employed Brown, whom he had previously known as engaged in the life insurance business, to sell stock for the company. From that time until he took his permanent vacation in January, 1915, about six years later, Brown was steadily in defendant’s employ, with headquarters in Grand Rapids, working that territory as its agent, authorized to sell its stock and solicit insurance for it, one or both, without possible question except as to the interim “between approximately the middle of October, 1913, and approximately the 20th of February, 1914,” during which time it is claimed his authority to sell stock was suspended.

The matter of Brown’s delinquencies was apparently carried beyond his power to cover them, and resulted in his absconding when plaintiff and Haitsema endeavored to secure their stock or return of their money, at the end of the year after they had paid, through their local bank. Robinson then visited Grand Rapids and Zeeland, trying to find Brown, and while there interviewed them. They both testify that he then told them Brown had authority to sell the company’s stock up to May 14th, and Haitsema testified Robinson explained that the stock was then taken away from him because the company was doing a good business and the stock would sell itself. This Robinson does not deny, but stated that he did not remember so telling them. He testified:

“Our talk principally was the fact that they bought the stock a long time before, and I knew nothing at all about it until they wrote that week, and what could be done I could not tell them about it. * * *
“Q. Then your complaint to them was that you had never received the money or the application from Brown, and that they had delayed for a long time in advising the company of the fact of their purchase?
“A. Yes.
“Q. And there is nothing further that you said to them in regard to it that you remember?
“A. No; not that I remember.”

He apparently at that time was urging that they were guilty of laches, which later took form in defendant’s plea of estoppel, and which manifestly is not a tenable issue under the facts in this ease. If Brown was not defendant’s agent at the time he sold this stock no question of estoppel is involved, and if he was its agent with authority to make the sale, plaintiff had performed on his part, and defendant had not. Within the statute of limitations no estoppel could arise in its favor by reason of it having defaulted in its obligations. Defendant’s counsel do not now so contend, and the only significance of that part of the interview is that, if Brown was not defendant’s agent when he sold the stock, its president, when talking to those men about the agency, apparently never thought of that. He was the man who best knew and would naturally have the facts within the field of consciousness; for under a contract with defendant of April 10, 1911, authorized by its directors, running for 12 years, he was engaged as its general manager with “general supervision and direction of all the affairs of said company, subject to the direction of the executive committee, to act as director of agencies of said company, with power to employ such managers of agents and such other agents as he shall deem best, and to remove them at will.”

Robinson, however, testified that while in the Battle Creek Sanitorium as a patient in the fall of 1913 he was advised by defendant’s secretary, Englehart, that application had been made by defendant to the State securities commission in compliance with the then coming into effect blue sky law, and the necessities in that connection, following which he wrote, while lying in bed, a letter to Brown, some time between September 29th and October 13th, telling him not to sell any more stock until further orders from the writer. No copy of this letter was kept, and the original could not be produced. He therefore was permitted to give oral testimony as to having written it and its contents.'

At a meeting of the directors on January 27, 1914, in a discussion touching proposed sales , of the company’s stock, Robinson stated that Brown had sold about 80 per cent, of all stock sold up to that time, and he thought him capable of disposing of the balance on the basis of a 10 per cent, commission. He then had in his possession and exhibited to the board applications for stock recently received from Brown, amongst which was one taken on the same date as that of plaintiff, and one on the day following, for both of which stock was issued. Englehart, the secretary, who served as such from August, 1913, to April, 1914, testified that the company had in its treasury about 777 shares of unsold stock, and up to about January or February, 1914, was desirous of selling stock, the disposition of which was entirely in Robinson’s hands; that Brown was defendant’s agent, selling stock and writing insurance, and witness did not know of his authority to sell stock being cut off, the general conversation and understanding being that after a license had been secured under the blue sky law from the State securities commission Brown, to whom no license was directly issued as selling agent, would have the selling of stock in Robinson’s name.

Without further detailing what witnesses testify to and defendant’s records show;, we are well satisfied from this record, taken as a whole, that there was ample testimony to carry the question of Brown’s agency during the time in question to the jury, and to clearly raise an issue of fact as to whether the claimed letter from Battle Creek, if written, was ever received by Brown. Aside from Robinson’s oral testimony to the contrary, the evidence, both oral and written, is persuasive that for several years, including the time in question, Brown was defendant’s well-known and recognized agent, authorized to sell its stock and solicit insurance for it, equipped with its blanks and forms of application for purchase, which were never recalled, and within the scope of such agency authorized to act for and bind his principal. The trial court under a fair and well-guarded charge submitted the single question of Brown’s agency, or authority to act, to the jury.

It is further urged, however, that, irrespective of what issues it might otherwise be permissible to submit to the jury, the court should have directed a verdict for defendant because it appeared without dispute that Brown was never licensed by the securities commission to sell stock, and his agency terminated by operation of law on taking effect of the blue sky law on September 10, 1913, which prohibited defendant from selling or offering its stock for sale until 30 days after it had filed the' necessary documents required by the act, and required all its authorized agents to be licensed and registered with the commission, citing ample authority upon the unquestioned proposition that an agency may be, and usually is, terminated “by a change of the law which would render performance of the contract illegal.”

The blue sky law of 1913 had a comparatively short and somewhat checkered career, having been held unconstitutional by the United States District Court (Alabama, etc., Transportation Co. v. Doyle [D. C.], 210 Fed. 173), and repealed at the next legislative session (1915), in view of which a case then pending in this court attacking the constitutionality of the act was dismissed, for the reason that the issues there raised had become moot questions. Howe v. Doyle, 187 Mich. 655 (154 N. W. 62).

We are not impressed that the ghost of that act yet walks in aid of those who seek to benefit by their failure to observe it when ostensibly in being, whether constitutional or not. Under that act, defendant had filed its application with the State securities commission, on September 18, 1913, which was approved and' a license to sell stock issued on October 15, 1913. Robinson returned from Battle Creek during October, and made a trip to the upper peninsula to sell stock and work up business for the company. It was not illegal under that act for defendant to sell its stock nor for plaintiff to buy. The act in one section required investment companies to register their agents, and in another provided agents should not act as such until their names and addresses are registered. This defendant failed to do as to Brown, on the theory, as its secretary testified, that Brown “would have the selling of the stock in Mr. Robinson’s name,” but if, as the jury found, he did in fact, act in the matter as defendant’s representative, authorized and recognized by it to act as such, he was, as between the parties directly interested, its de facto agent, dealing for defendant with an innocent party. It was lawful for defendant to sell its stock, and certainly for plaintiff, who knew of no irregularities on defendant’s part in making the sale, to buy it.

This action, however, is not for the stock, but for money had and received for defendant by its authorized representative. We think the principle which should be applied to that question in this case is well settled in People v. Hawkins, 106 Mich. 479 (64 N. W. 736), a criminal case where, in defense of a charge of embezzling money collected by him as agent, Hawkins contended that the corporation for which he collected the money was doing business in this State illegally by reason of noncompliance with statutory requirements relative to foreign corporations, and therefore all contracts made by it were void. Speaking through Justice Hooker, this court there said:

“But, if it should be held that the act under consideration was prohibitive, and that the company could not make or enforce contracts, it would not follow that this defendant could not be guilty of embezzlement. In fact, he was the agent of the company, whether it was a lawful enterprise or engagement or not. By virtue of his relation, he became possessed of property which was not his, and which belonged to the company if to anybody. He acted for, and permitted himself to be held out as the agent of, the company, and received money from various persons who were willing to pay. He was a de facto servant, and it is unnecessary that his relation should have grown out of a lawful * * * agency. It was enough if he acted, and was permitted to act, as such.”

Merely private interests are involved here. No rule of public policy suggests that the courts should by any narrow or technical construction -find this undertaking illegal as a defense to an action to recover moneys from the party by whom, through its de facto agent, they were received, and we think the court properly submitted to the jury as a question of fact whether or not they were so received.

The judgment is affirmed.

Stone, C. J., and Kuhn, Ostrander, Bird, Moore, Brooke, and Person, JJ., concurred.