author: Montgomery, J.

text:
    PEOPLE v. YEAGER
    Constitutional Law — Right to Public Trial.
    Section 18 of Act No. 408, Local Acts 1898, authorizing the judge of the recorder’s court of Detroit to exclude from the court room, upon the trial of any cause wherein evidence of licentious, lascivious, degrading, or peculiarly immoral acts will probably be given, all persons except those necessarily in attendance, is unconstitutional as applied to a criminal case, in that it violates the right of the accused to a public trial.

    Exceptions before judgment from recorder’s court of Detroit; Chapin, J.
    Submitted May 11, 1897.
    Decided May 28, 1897.
    Joseph H. Yeager was convicted of assault with intent to commit rape.
    Reversed.

      George F. Robison, for appellant.

      Allan H. Frazer, Prosecuting Attorney, and Henry A. Mandell, Assistant Prosecuting Attorney, for the people.

       Some other authorities on the right to public trial in a criminal case are found in a note to People v. Murray, 14 L. R. A. 809.

   Montgomery, J.

The defendant was convicted of assault with intent to commit rape, and the case is brought here for review on a single exception. After the jury were sworn, the court excluded from the court room all persons not legitimately interested in the case, but announced that any friend or person that was connected or related to or interested in the defendant himself was not to be excluded; and, finally, in order to carry into effect the order, the court asked all the people to retire from the court room, and directed the officer in attendance to admit any who were relatives or friends of the defendant, and also permitted the representatives of the press to remain, the court saying: “I don’t propose to have the court room filled up with people here to embarrass witnesses in this case.” The final announcement made by the court was: “I have told the officer not to let anybody in here who is not either a friend of the complaining witness or of the defendant. He will ascertain that fact- as they apply for admission. All such people will be admitted, and the public will be kept out.” And the court directed the officer to see that that rule was enforced. In making this order, the court acted under the authority of Act No. 408, Local Acts 1893, § 18, which provides:

V Whenever it shall appear that, upon the trial of any cause, evidence of licentious, lascivious, degrading, or peculiarly immoral acts or conduct will probably be given, the judge presiding at such trial may, in his discretion, require and cause every person, except those necessarily in attendance thereon, to retire and absent himself or herself from the court room during such trial, or any portion thereof.”

Whether this statute is effective must depend upon whether the trial provided for may be deemed a public trial; for, if such a trial as is provided for by the statute is not a public trial, the act is plainly in conflict with section 28 of article 6 of the Constitution, which reads as follows: “In every criminal prosecution, the accused shall have the right to a speedy and public trial by an impartial jury.” This constitutional provision was under consideration in the case of People v. Murray, 89 Mich. 276, 290 (28 Am. St. Rep. 294). In an elaborate opinion, Mr. Justice Champlin, referring to the case of People v. Kerrigan, 73 Cal. 222, the case relied upon by the prosecution here, made use of the following language:

“ I cannot accede to the correctness of the proposition intimated in that case, — that, if a public trial has not been accorded to the accused, the burden is upon him to show that actual injury has been suffered by a deprivation of his constitutional right. On the contrary, when he shows that his constitutional right has been violated, the law conclusively presumes that he has suffered an actual injury. I go further, and say that the whole body politic suffers an actual injury when a constitutional safeguard erected to protect the rights of citizens has been violated in the person of the humblest or meanest citizen of the State. The Constitution does not stop to inquire of what the person has been accused, or what crime he has perpetrated; but it accords to all, without question, a fair, impartial, and public trial. There is no such limitation in the Constitution nor in our statute above quoted from which it can be inferred that ‘the requirement is fairly observed if, without partiality or favoritism, a reasonable proportion of the public is suffered to attend, notwithstanding that those persons whose presence could be of no service to the accused, and who would only be drawn thither by a prurient curiosity, are excluded altogether. ’ Who is to decide who are the friends of the accused ? The law makes no such test, but allows all citizens freely to attend upon any trial, whether civil or criminal. Instances have been referred to by Judge Cooley, in his work upon Constitutional Limitations (5th Ed., at page 380 [star page 312]), where, under certain circumstances, it might be proper to exclude a certain portion of the community from attending trials which would tend to degrade public morals, or would shock public decency, in which he says that at least the young should he excluded. There can be no objection to this, so long as citizens of the State who have arrived at the years of discretion and manhood are permitted to enter freely. ”

We are constrained to hold that the decision in that case rules the present, and that the order of the learned trial judge was unwarranted.

The conviction will be reversed, and a new trial ordered.

The other Justices concurred.


source: Caselaw Access Project

license: Public Domain

text:
    MOTLEY v. WICKOFF.
    1. Partnership — Dissolution—Firm Debts — Release—Consideration.
    An agreement between copartners upon the dissolution of the firm, whereby one partner assumes all of the firm debts, will not, of itself, support the subsequent promise of a creditor to release the other partner from liability.
    2. Same,
    The promise of one partner to pay a debt of the firm, if made to the creditor himself, may afford a sufficient consideration for the release of his copartner.
    3. Same — Privity.
    The mere statement by a;partner, after dissolution of the firm, to one of the partnership creditors, that he has agreed with his copartner to pay the firm’s indebtedness, and the creditor’s reply of “all right; pay as fastas you can,” does not establish a privity between them as to the obligation of the former to pay the debt individually.
    Error to Ionia; Davis, J.
    Submitted May 11, 1897.
    Decided May 28, 1897.

      Assumpsit by Ara É. Motley against James Wickoff, retiring partner of tbe firm of Gill & Wickoff, to recover the amount of a copartnership debt. From a judgment for plaintiff, defendant brings error.
    Affirmed.

      W. H. Hoiuard (McQarry & Nichols, of counsel), for appellant.

      Wesley H. Mains, for appellee.
   Montgomery, J.

This case was determined by the circuit court upon an agreed state of facts. The defendant and one Gill, as copartners, became indebted to the plaintiff in the sum of about’ $140. In April, 1891, Wickoff retired from the firm of Gill & Wickoff, and Gill, in consideration of the partnership property all being turned over to him, assumed the payment of all the partnership debts. After the dissolution of the firm, and before this action was brought, the amount had been reduced from $140 to $116, by payments to plaintiff made by Gill. It further appears that Gill, shortly after the dissolution, stated to plaintiff that he had assumed, and agreed with Wickoff to pay, all the partnership indebtedness, and that to said statement plaintiff replied, “All right; pay as fast as you can;” that, some time after the dissolution, defendant saw the plaintiff, and stated to him that, according to the terms of the dissolution between himself and Gill, Gill was to pay the sum due and owing to the plaintiff, and asked plaintiff if he would release him (defendant) from the indebtedness, to which plaintiff replied that he would. Upon this state of facts, the case was 'submitted to the court, upon a stipulation that the plaintiff was entitled to recover if the court should find that the defendant had not been released from the indebtedness. The court found, as matter of law, that there was no consideration for the promise of the plaintiff to defendant to release him from his liability on the partnership indebtedness, and entered judgment for the amount claimed, with costs.

Defendant suggests, rather than urges, that the case is one where the rule adverted to in Webber v. Alderman, 102 Mich. 638, namely, that where the surety is induced to forego or relinquish means of indemnity to which he might otherwise have resorted, by the promise of the creditor to exonerate the surety, this may work an equitable estoppel to deprive the promisor of the power to retract, is applicable. But there are no facts found in this case which make this rule at all pertinent. There is no finding that the responsibility of Gill has in any way been changed, or that defendant has changed his position in the matter because of any assurances given by plaintiff.

The case must turn upon the question of whether there was a consideration to support the promise to look to Gill alone. The authorities are not agreed upon the question of whether the agreement of one joint debtor or copartner to pay the debt upon which the two are liable is a sufficient consideration to support a release of his co-debtor. The modern English doctrine appears to be that such an undertaking is a sufficient consideration, on the ground that the sole liability of one of two debtors may, under many circumstances, be more beneficial and convenient than the joint liability of two, and that whether it was actually a benefit in each particular case will not be inquired into, but that the changed relation will be held to be a sufficient consideration. See Thompson v. Percival, 5 Barn. & Adol. 925, and Lyth v. Ault, 7 Welsb., H. & G. 669. This doctrine has also found support in this, country, to the extent stated in Collyer v. Moulton, 9 R. I. 90 (98 Am. Dec. 370), in which it was said:

“If, by a mutual arrangement between the plaintiff Collyer and the two defendants, Moulton had been released from his liability for the work already done, and a new promise made by Bromley, the other defendant, to pay for it, this would have been a valid release for a valuable consideration; one debt would have been substituted for the other. ”

See, also, Bantz v. Basnett, 12 W. Va. 772; Bowyer v. Knapp, 15 W. Va. 277; Waydell v. Luer, 3 Denio, 410. Contra, Early v. Burt, 68 Iowa, 716: Wild v. Dean, 3 Allen, 579.

In the case of Johnson v. Emerick, 70 Mich. 215, Mr. Justice Champlin, speaking for the court, said:

“Such discharge from liability is based upon the express or implied assent of the creditor, upon a sufficient consideration; and a creditor, knowing of such relation, who goes on and deals, with the other partners with reference to the debt, may well be held to have assented to the arrangement, and to have accepted the responsibility and promise of the partner assuming such debt. This consideration need not be a money consideration. It may be the obtaining of an additional- security, better terms of payment, negotiable securities which the creditor may use in his business, or any other benefit, or it may be a loss of some right or disadvantage suffered by the surety through the act of the creditor.”

In the present case it will be noted that the transfer of the firm property by defendant to Gill was not induced by any promise of plaintiff, but had occurred before any promise of release was made; nor does it appear, as before stated, that the defendant lost any rights; nor was-any security taken or accepted by the plaintiff; nor does it appear that the time for the payment of the debt was-extended.

Plaintiff relies upon Walstrom v. Hopkins, 103 Pa. St. 118, and Eagle Manfg. Co. v. Jennings, 29 Kan. 657 (44 Am. Rep. 668). In the latter case it was claimed that the plaintiff had due notice of the dissolution of the firm, and the assumption of the liabilities by Whitney, and that it accepted him for the payment of the bill of exchange. The court said:

“The dissolution of the partnership, the taking of all the partnership property, and the assumption of all partnership liabilities by Whitney, in no manner released defendant. The alleged promise of plaintiff was made after the dissolution, and not as an inducement to or consideration of it. The acceptance has never been paid. * * * No-additional security of any kind was furnished. The acceptance was not destroyed and new paper given. The plaintiff received absolutely no consideration, and, even if it did promise that it would look to Whitney, such promise was entirely without consideration, and in no manner discharged the defendant. ”

In Walstrom v. Hopkins it was held that a promise by a creditor of a firm to release a partner who has retired from the firm, and to look to the continuing partner only for the payment of his debt, unless founded upon-a legal consideration, is nudum pactum, and cannot be enforced.

The-weight of authority favors the contention that the promise of the continuing partner may be a sufficient consideration to support the release of the outgoing partner. But, in the absence of such concurring or binding promise, we think no well-considered case can be found* holding that the mere agreement between the partners will of itself support the agreement of the creditor to release the outgoing partner. Such an agreement does not establish a privity between the continuing partner and the creditor, entitling him to sue such partner individually. It is only a private executory contract, intended to regulate the rights, duties, and obligations of the co-partners between themselves, consequent upon a dissolution of the firm. Wild v. Dean, 3 Allen, 579. In the present case there was not only no extension of time, no acceptance of the paper of the individual partner, but the stipulation does not show an express agreement made to plaintiff by Gill to pay the debt. The finding is that Gill stated to plaintiff that he had agreed with Wickoff to pay all partnership indebtedness, and that to this the plaintiff replied, “Allright; payas fast as you can.” It will be noted that this was not simultaneous with the release of Wickoff, nor did it in terms establish a privity between Gill and plaintiff as to the obligation of Gill to pay the debt individually.

We think the judgment should be affirmed.

The other Justices concurred.


text:
    WOODCOCK v. FIRST NATIONAL BANK OF NILES.
    1. Appeal — Fraud.
    Upon a consideration of the testimony, held, that complainant had failed to establish his claim that certain stock, pledged as collateral to a note and mortgage, was fraudulently withheld from him upon the occasion of his taking an assignment of the mortgage.
    2. Assignment oe Mortgage — Rescission—Estoppel.
    An assignee of a mortgage given by a corporation cannot rescind the assignment upon the ground that the mortgage was the outgrowth of an ultra vires transaction, where he was aware of the facts upon which such contention is based before he accepted the assignment.
    3. Corporations — Ultra Vires — Negotiable Paper.
    A note and mortgage given by a corporation cannot be defeated in the hands of a good-faith purchaser before dishonor who took the same as the result of negotiations with the officers of the corporation, on the ground that the transaction out of which the securities grew was uItra vires.

    Appeal from Berrien; Buck, J., presiding.
    Submitted November 11, 1896.
    Decided May 28, 1897.
    Bill by Edward E. Woodcock against the First National Bank of Niles, impleaded with Charles A. Johnson and others, to rescind the assignment of a mortgage. From a decree for complainant, defendant appeals.
    Reversed.

      E. L. Hamilton. and Edward Bacon, for complainant.

      M. L. Howell, for defendant.
   Montgomery, J.

In 1891 the Niles Gaslight Company was engaged, and had for some time been engaged, in furnishing light to the citizens of Niles. In April of that year the Niles Electric Company was organized. On the 12th of May the Niles Gaslight Company borrowed of the First National Bank $10,000, which it used in purchasing a controlling interest in the stock of the electric company. The money was not paid to the company, but the credit was transferred from the gaslight company to the electric company on the books of the bank. The loan was secured by a real-estate mortgage, covering the plant of the Njles Gaslight Company, and also by a pledge of the shares of stock in the electric company acquired by the gaslight company. The loan was also evidenced by a promissory note, signed by the secretary and president of the gaslight company. This note was payable in one year from date. In May, 1892, the bank, by its cashier, extended the time of payment for one year.

Charles A. Johnson was cashier of the First National Bank during this time, and was also a stockholder and an officer in the gaslight company. On the 16th of May, 1892, he sold his stock in the gaslight company, and ceased to be an officer. Complainant was cashier of the Citizens’ National Bank, a rival institution. By the records of that bank, it appears that on the 23d of May, 1892, an application was made by the gaslight company for a loan, and the following resolution was adopted: “On motion of Mr. Dean, supported by Mr. Gage, a loan of $10,000, for four months, was agreed upon to the Niles Gaslight Company, upon a mortgage upon their plant.” On the 27th of May, in place of making a new mortgage, an assignment in blank was made by the First National Bank, it not being known to the officers of the bank to whom the mortgage was to be assigned; and this, together with the note and pledge of stock, was delivered to Bascom Parker, president of the gaslight company, and Worth Landon, an attorney who had drawn the assignment, upon payment to the bank of the $10,000 secured by the mortgage. It appears that, at the time this transfer was-made, two separate notes, each in the sum of $10,000, were delivered by the cashier to Parker. The reason for the existence of these two notes is a matter of dispute between the parties, and will be referred to hereafter. One of these notes was signed by the secretary of the company only, while the other noté was signed by both secretary and president of the gaslight company, and this was the note described in the mortgage. Parker did not deliver to complainant either the pledged stock or the note signed by both president and secretary, but delivered with the assignment the mortgage, and the note signed by the secretary.

The mortgage and note were not paid, and on the 33d of December, 1893, the complainant filed the bill of complaint in the present case, seeking to rescind the transaction by which he became the purchaser of this mortgage, having, on November 39, 1893, tendered a reassignment of the mortgage to the bank, together with the amount of interest which had been collected by him upon the same. The grounds upon which rescission was sought were two: That a fraud was committed in putting off upon him the mortgage accompanied by the note signed by the secretary alone, and not accompanied by the stock which was collateral to it, his claim being that his agreement with the gas company was that he (complainant) was to receive the same securities which the First National Bank had, and, in effect, that Johnson, cashier of the defendant bank, and Parker, conspired to deceive him, and put off upon him securities which were other and different than those which the bank held; and, second, that the purchase by the gas company of the electric light stock was unlawful, and that there was no consideration for this note, and that the gas company, or any member of the company, might avail themselves of that defense, and that a bill had been filed, apparently conceded, however, to be defective, by one of the stockholders in the gas company, for the purpose of annulling this transaction.

The circuit judge, before whom the case was tried, found with the complainant upon the question of fact, and determined that the charge of fraud had been sustained. We are not able to affirm this determination. The conclusion is based very largely upon the testimony of Bascom Parker, who, by his own showing, is not a very reliable witness. It is apparent, both by the testimony of Woodcock and Parker, that the negotiations between the gas company and complainant did not, in the first instance, include or relate to the pledged stock of the electric light company at all, and the resolution of the bank, above referred to, shows that the security offered, and which the bank was ready to accept, was to consist of a mortgage upon the plant of the gaslight company. Parker’s version of the transaction is that, after an abstract had been. secured and shown to the complainant, he was then told -for the first time by complainant that he desired an assignment of the securities or mortgage held by the First National Bank, saying that what was good enough security for the First National iBank Avould be good enough for complainant or his bank. It is an important fact that not until after these negotiations had been entered upon, according to the theory of complainant, was Parker himself aware, as his testimony would show, that the electric light stock held by the gas company was pledged to the First National Bank. His claim is that he informed Johnson of the fact that the parties of whom he was to obtain the money wanted an assignment, which meant that that did not release the stock, and that Johnson thereupon took a blank note, filled it out, and had it executed by the secretary of the gaslight company, Mr. Landon, to be substituted in place of the note secured by the mortgage. He also testified that at this time he informed Johnson that the Citizens’ Bank did not desire a new mortgage; that they wanted the one which he had assigned over to them, and in that event the stock would still be tied up, and Mr. Bacon and himself (Parker) would-be unable to raise the money to pay to Johnson and the First National Bank the money that Parker personally owed them. The theory of defendant, on the other hand, as supported by the testimony of Johnson and of Landon, is that the note signed by the secretary was carried in the bank so that the bank examiner would not be aware of the fact that the bank was carrying paper secured by real-estate mortgage. Both deny in toto the charge of conspiracy, and we think the ■version of defendant is established by the great weight of the testimony. Parker’s own testimony, if believed, would implicate Johnson in a conspiracy, not only to deceive the complainant, but to wink at the embezzlement of the funds of the gaslight company by Parker, for the purpose of appropriating the. money to the payment of his own debts, and this notwithstanding the fact that the company was still indebted to Johnson and to his bank. We choose not to credit the testimony of such a witness when opposed by that of reputable witnesses, and particularly in view of the fact that, when this loan was originally agreed upon, no security other than the mortgage on the plant was contemplated by either party to the transaction.

As to the contention that the mortgage was void because it was the outgrowth of an ultra vires transaction, it appears that complainant, at the time he took the assignment of this mortgage, was aware that the same was given to secure a loan that was made for the purchase of this electric light stock. It further appears that by no effective proceedings has the gaslight company ever repudiated this contract; and it may be added that if the complainant was not aware of an infirmity in these securities in the hands of the First National Bank, as the paper was not dishonored when received by complainant, and was negotiated by the officers of the gaslight company, the security could not be defeated in complainant’s hands. Wright v. Pipe Line Co., 101 Pa. St. 204 (47 Am. Rep. 701).

The decree of the court below, rescinding this transaction, will be reversed, with costs of both courts to the defendant.

The other Justices concurred.


author: Long, C. J.

text:
    HILTON v. DUMPHEY.
    1. Taxes — Sale of Lands — Collateral Attack.
    A tax sale to the State is not subject to collateral attack on the ground that the land was not offered for sale a second time before being bid in to the State, as required by section 62 of the tax law of 1889 (3 How. Stat. § HYOgfl), where the owner of the land, although appearing in the proceeding in which the decree of sale was made, took no steps to set aside the sale within the time prescribed by section 66 for filing objections to confirmation.
    2. Same — Drain Taxes — How Enforced.
    Under section 6, chap. 6, of the drain law of 1885 (3 How. Stat. § 1740/6), providing that taxes assessed under such act shall be collected in the same manner as State and other general taxes, lands delinquent for drain taxes may be bid off in the name of the State, in a proper case, in accordance with the provisions of the general tax law, notwithstanding lands so bid to it are, by the terms of such law, held “for the use of the State, county, and town, in proportion to the amount due each,” neither of which bodies has any pecuniary interest in drain taxes.
    Error to Monroe; Kinne, J.
    Submitted April 13, 1897.
    Decided May 28, 1897.
    Ejectment by Joseph S. Hilton against Azuba Dumphey. From a judgment for defendant, plaintiff brings error.
    Reversed.

      Randall & Corbin, for appellant.

      Landon & Lockwood (I. R. Grosvenor, of counsel), for appellee.
   Long, C. J.

Action of ejectment. Case tried before the court without a jury, who made findings of fact and law, and entered judgment in favor of defendant. Defendant is in possession of the property. Plaintiff claims title under tax deed.

It appears that in 1889 a petition was presented to the township drain commissioner to widen and deepen what is called “Jones’ Drain.” Such proceedings were had that a tax amounting to $40.02 was assessed upon defendant’s land for the construction of the drain. All the other taxes of this year were paid, and the land was returned delinquent for this drain tax. On April 15, 1892, a petition, filed in the circuit court of Monroe county, in chancery, for a decree for the sale of lands returned delinquent for taxes, came on to be heard, and a decree was entered, adjudging, among other things, that this land be sold to pay said tax. On the 2d day of May, 1892, the premises were bid off to the State for the sum of $50.92, and on the 15th of May, 1893, the county treasurer, pursuant to notice that a sale would be made of all lands previously bid in by the State, struck off and sold them and the bid of the State to Cyrus W. Pettit, who afterwards conveyed to the plaintiff.

It is defendant’s contention:

1. That there is no authority in the tax law empowering the county treasurer to bid to the State lands for a drain tax.
2. That, even if the State could bid in the land, there is no evidence of a lawful sale.

The sale was made under Act No. 195, Pub. Acts 1889. Section 62 of that act provides:

‘ ‘ If any parcel of land cannot be sold for taxes, interest, and charges, such parcel shall be passed over for the time being, and shall on the succeeding day, or before the close of the sale, be reoffered; and if on such second offer, or during such sale, the same cannot be sold for the amount aforesaid, the county treasurer shall bid off the same in' the name of the State, for the use of the State, county, and town, in proportion to the taxes, interest, and charges due each.” 3 How. Stat. § 1170ql.

The report of the county treasurer, as found by the court below, shows that he “did keep such sale open until eacli and every parcel of land mentioned in said tax record and described therein had been publicly offered for sale, and that the parcels of land described in said record opposite to which appears the word ‘State’ did not receive any bids,” and that, in pursuance of the statute, he “did bid them off in the name and in behalf of the State of Michigan, for the sums set opposite to each respective parcel so marked.” It is contended by the defendant that there is no showing by the report of the county treasurer that he offered this parcel of land for sale, and for want of bidders passed it over to the succeeding day, or before the close of the sale reoffered it for sale; and that, therefore, there was no such compliance with the provisions of the statute as to make the sale a valid one.

The report does not affirmatively show that'there was any second offering, as directed by the statute; but section 66 of the act provides that the report of sale shall be filed with the clerk of the court, etc., and “all sales shall stand confirmed, subject to the right of redemption provided for in section 64, unless objections thereto are filed within eight days after the time limited for filing such report, without the entry of any order of further notice.” This statute, therefore, makes it unnecessary to enter any order of confirmation. The sale stands confirmed upon filing the report, unless objections are filed within eight days, etc. The tax record, we think, fairly discloses that defendant appeared, in the proceedings on which the decree was taken, as it is stated that her objections were overruled. Can she now, without having moved to set aside the sale within the eight days provided by the statute, and in a collateral proceeding, take advantage of the irregularity in making the sale? The defect is not jurisdictional. If it were, it would be subject to very different considerations. If defendant had applied to the court in that proceeding seasonably, there can be no doubt but that the sale would have been set aside. This she did not do. She cannot raise the question in this collateral proceeding. Ruggles v. First Nat. Bank, 43 Mich. 196; Van Fleet, Coll. Attack, §§ 787, 788.

Under the first point made by counsel, it is contended that, inasmuch as by the provisions of section 62 of the general tax law the county treasurer “shall bid off the same in the name of the State, for the use of the State, county, and town, in proportion to the taxes, interest, and charges due each,” it is apparent that this statute has no application to the sale of lands for drain taxes, as neither the State, county, nor town has any interest in the moneys arising from such sales; that such taxes are purely neighborhood affairs, under Dawson v. Township of Aurelius, 49 Mich. 479; Camp v. Township of Algansee, 50 Mich. 4; Anderson v. Hill, 54 Mich. 485; Alcona Co. v. White, Id. 505. It is true that these drain matters are not regarded as matters in which the State, county, or township has a pecuniary interest; but the drain law provides that such taxes are to be collected “in the same manner as State and other general taxes are collected,” etc. This act was passed in 1885, and, so far as any provision of the drain law is concerned, has not been changed. There is no provision for the sale of lands for the nonpayment of drain taxes other than that found in the general tax laws. It must be presumed that the legislature intended that some method should be provided for selling lands assessed for drain taxes. Such tax is made a perpetual lien upon the lands assessed, and we think the general tax laws were-intended to cover sales of this kind. While the State has no pecuniary interest in the matter, yet the legislature, by the act, made the county treasurer the agent of the State for the purpose of making sales of lands for delinquent taxes, and, as such agent, he is, we think, clothed with authority to sell lands for drain taxes, and therefore that the bid to the State in this case was authorized by the general tax law. The land was struck off to the State, and the next year reoffered, and sold to Mr. Pettit.

The court was in error in concluding that the judgment should be in favor of defendant. Under the facts found, the judgment should have been for the plaintiff. Such judgment will be entered here, with costs of both courts in favor of plaintiff.

The other Justices concurred.


author: Grant, J.

text:
    AUDITOR GENERAL v. HUTCHINSON.
    1. Taxes — Collection by Sale of Lands — Irregularities.
    Under the curative provision of the tax law of 1893 (Act No. 206, § 99), the fact that a city assessor delivered the original tax roll to the treasurer, instead of a copy, as provided by the charter, and that the treasurer failed to verify his return of uncollected taxes within the specified time, will not defeat a proceeding by the auditor general to enforce the tax by a sale of the land.
    2. Same — Proceedings of City Council — Presumption.
    The courts will not assume that the common council of a city failed to make an estimate of the general expenditures, as required by the charter, before levying the city taxes, because no entry thereof is made upon the records of the council, where there is no express provision requiring such entry to be made.
    3. Municipal Corporations — Special Meeting of Council —. Validity.
    Action taken at a special meeting of a 'city council is not invalid for want of proof of due notice of the meeting, where it appears from the record of the vote taken that all of the members were present.
    4. Newspapers — Notice—Sufficiency of Publication.
    A charter' provision requiring a notice to be published in each of the public newspapers printed in the city does not include newspapers printed in foreign languages.

      Appeal from Muskegon; Russell, J.
    Submitted April 9, 1897.
    Decided May 28, 1897.
    Petition by Stanley W. Turner, auditor general, for the sale of lands delinquent for taxes. James Hutchinson and others filed objections. There was a decree for contestants, and petitioner appeals.
    Reversed.

      Fred A. Maynard, Attorney General, and H. L. Delano, City Attorney (Bunker & Carpenter of counsel), for petitioner.

      Arthur Jones, Smith, Nims, Hoyt & Erwin, and P. W. Niskern, for contestants.

       Some other authorities on the publication of official notices in foreign languages are found in a note to State v. Mayor of Orange, (N. J.) 14 L. R. A. 64.

   Grant, J.

This is the usual petition by the auditor general for the sale of delinquent tax lands. The contestants filed 22 objections against the taxes. The assessment was held void and the petition dismissed as to the contestants, for two reasons, namely:

(1) The assessor did not make or cause to be made the assessment rolls and the tax rolls of the city of Muskegon as required by the charter of the city.
(2) The treasurer did not, within the time and in the manner required by the statute and the charter of said city, return the lands to the assessor of sa,id city as delinquent for unpaid city, school, library, one mill, and schoolhouse taxes, and verify such return in the manner provided by law.

The tax involved amounts to about $9,0Q0.

Section 99 of the tax law of 1893 (Act No. 206), under which this assessment was made, is as follows:

“No tax assessed upon any property, or sale therefor, shall be held invalid by any court of this State on account of any irregularity in any assessment, or on account of any assessment or tax roll not having been made or proceeding had within the time required by law, * * or on account of any other irregularity, informality, or omission, or want of any matter of form or substance in any proceeding that does not-prejudice the property rights of the person whose property is taxed; and all proceedings in assessing and levying taxes, and in the sale and conveyance therefor, shall be presumed by all the courts of this State to be legal until the contrary is affirmatively shown.”

In preparing the assessment and tax rolls, the assessor first listed and valued this .taxable property on a single roll, which was submitted to the board of review, and was by that board reviewed and corrected. The assessor then made two copies, which were also submitted to the board of review, and were approved and adopted by the board. On one of these copies he spread the city and school taxes, and attached to it his warrant, and then delivered the roll and warrant to the treasurer, whose duty it was to collect the taxes. In November the treasurer made statements of the uncollected taxes, real and personal, on that roll, and delivered them, with the roll itself, to the assessor. He failed to verify the statements until December, 1894, when he swore to an affidavit, and attached it to the statements. The provisions of the city charter covering the points raised are in sections 6, 10, 11, and 12 of title 10 of the charter (Act No. 304, Local Acts 1889). It is unnecessary to quote them. The defects consist in this:

(1) That the assessor attached his warrant to the original tax roll, and delivered it to the treasurer, instead of delivering a copy, as the charter required.
(2) That the treasurer, in making his return, did not verify his statements of uncollected city and school taxes.

No claim is made, either in the objections filed to the petition, or in the testimony, or in the arguments of counsel, that the taxes are unjust or excessive. Contestants are not before the court offering to bear their just proportion of the public burden. On the contrary, they seek to avoid the payment entirely because officers upon whom is imposed the duty to perform certain acts have not performed them in strict accordance with the requirements of the law. It is too clear to require extended argument that the fact that the collector used the original tax roll instead of a copy, and the failure to verify a statement at the time required by the law, do not affect the justice of the tax, nor prejudice the property rights of these contestants. If these defects are not covered and. cured by the curative statute above cited, it is difficult to note any defect which would be cured by it.

The learned counsel for the petitioner have presented able arguments contrasting the position taken by courts of law and of equity under the earlier tax laws. We have not time to discuss the interesting subject. It is sufficient to say that in cases at law the statutes were, as a rule, so strictly construed that it was generally understood, not only by lawyers, but by laymen, that the presumption was against the validity of a tax title. It is noticeable also that when the original owner filed his bill in equity to remove a cloud from title, or to restrain the sale of his land, the courts acted upon the wholesome maxim, “He who asks equity must do equity,” and, as a-condition precedent to release, required him to pay his share of the public burden admitted to be just. This principle appears in the following cases: Merrill v. Humphrey, 24 Mich. 170; Albany & Boston Min. Co. v. Auditor General, 37 Mich. 391; Burt v. Wadsworth, 39 Mich. 126; Connors v. City of Detroit, 41 Mich. 128. Other cases to the same effect might be cited from both this and other courts. Undoubtedly, the legislature, in view of these decisions, intended to confer upon courts of equity jurisdiction to decree a sale of delinquent lands, in which proceeding a taxpayer would be permitted to appear and defend, not upon technical grounds, or upon a mere neglect of official duty which did not affect the justice of the tax or prejudice his property rights, but in which he might appear and defend for defects which were jurisdictional, and which prejudiced him. Under the old law, the prudent and honest men paid their taxes; the careless and dishonest did not. Under that system the prudent and honorable men paid more than their fair share of the public burdens. The present law was aimed to cure this evil, and should be liberally construed. We are of the opinion that the court was in error in holding that these defects are not cured by the statute. Hamilton & Merryman Co. v. Township of L’Anse, 107 Mich. 419; Auditor General v. Longyear, 110 Mich. 223; Auditor General v. Jenkinson, 90 Mich. 523.

It is urged as a fatal defect that, the records of the common council do not show that estimates of the general expenditures were made as the charter requires. The only evidence that such estimates were not made is the fact that there was no entry of them upon the records. There is no express provision of the charter requiring such entry to be made. These estimates are usually made by a committee, and courts will not assume that no such estimates were made and included in the annual appropriation budget from the fact that no entry thereof is made upon the record.

This action of the council was taken at a special meeting, and there is no record of serving notice upon all the members of the council. The roll call, as appears by the record, discloses one absent member. He was undoubtedly absent from the council chamber when the roll was calléd, but the record shows that he was present, and voted on the resolution. The objection is therefore without force.

The charter requires that notice of the meeting of the board of review shall be given 10 days previous to this meeting by publication in each of the public newspapers printed in the city. A Swedish newspaper was printed in the city, and notice was published in it, but not 10 days prior to the meeting. This provision does not mean newspapers printed in foreign languages. The English language is the recognized language of this country, and whenever the law refers to publication in the newspapers it means those published in the language of the country. In Graham v. King, 50 Mo. 23 (11 Am. Rep. 401), it was held that, ‘"‘when notices are to be published in a paper, an English paper is always intended unless it is expressed to be otherwise.” This case was-approved in Schaale v. Wasey, 70 Mich. 419, where notice published in English, but in a newspaper published in a foreign language, was held void. If the legislature desires to provide for publications in foreign languages, it may do so by express enactment. There was, therefore, no necessity for publishing it in this paper. But, if there were, there is no evidence that the contestants in this case were prejudiced in their property rights by this failure.

It is unnecessary to discuss the other objections raised. They are all covered by the statute as above construed.

Decree is reversed, and the case remanded for further proceedings.

The other Justices concurred.


text:
    FRANCIS v. HURD.

    1. Payments — Duress—What ■ Constitutes.
    Payment made by a mother to the owner of goods taken by the former's daughter cannot be recovered back on the ground of duress, although the owner was pressing for payment, and there was a dispute as to the value of the goods taken, where there was no threat by the owner of a prosecution of the daughter for a criminal offense, and the payment was voluntarily arranged for on one day, and the amount paid on the next after consulting a lawyer.

    2. Same — Fraud—Question for Jury.
    But where the circumstances are such as to justify an inference of bad faith on the part of the owner, whether a recovery should be had on the ground of fraud and overreaching is a question for the jury, under proper instructions.

      Error to Ingham; Person, J.
    Submitted February 5, 1897.
    Decided May 28, 1897.

      Assumpsit by Ann Francis against Daniel C. Hurd to recover money alleged to have been obtained by fraud and duress. From a judgment for plaintiff, defendant brings error.
    Reversed.

      Harris E. Thomas ( Cahill & Ostrander, of counsel), for appellant.

      Q. A. Smith and M. V. & B. A. Montgomery, for appellee.

       Rehearing denied September 14, 1897.

      The effect of duress by threats to prosecute a relative is considered in a note to City Nat. Bank v. Kusworm, (Wis.) 26 L. R. A. 48.

   Long, C. J.

This action was brought to recover the sum of $500, claimed to have been paid by plaintiff to the defendant under duress. The declaration avers the circumstances under which the money was paid substantially as follows:

1. That the plaintiff is the mother of Ella Francis, now Mrs. Urch, a young lady about 28 years of age, who had been in the employ of defendant in his store as a clerk and saleswoman.
2. That on July 14, 1892, defendant falsely and fraudulently claimed and pretended to plaintiff that her daughter had been guilty of stealing, taking, and carrying away defendant’s goods.
3. That her daughter was about to be and would be arrested on complaint of defendant for such larceny unless plaintiff paid defendant $500.
4. That plaintiff was so wrought upon and agitated by such unlawful claim and pretense that she paid the $500.

It appears that the plaintiff’s daughter, at the time of the payment of the money, was a woman about 28 years of age. She commenced work for defendant as a clerk in 1887, and had become principal clerk in the store. Her parents lived on a farm near Lansing, and were customers of defendant, who dealt in dry goods, clothing, boots, and shoes, and had so dealt for some 18 years, in North Lansing. When Miss Francis entered defendant’s employ, there was a dressmaking establishment in the same building over defendant’s store. Defendant removed Ms stock to another building, and soon after the dressmaking establishment was removed over the new location. The dressmaking business was conducted by Miss Towne, a friend of plaintiff’s daughter, and with whom the daughter much of the time roomed and boarded. She was rooming and boarding there in July, 1892. Miss Francis commenced work for |2.50 per week, but her pay was increased from time to time until, in July, 1892, she was receiving $7.50 per week.

As early as 1889 defendant was told by one of the clerks that he believed Miss Francis was taking money from the store. Later another clerk told him the same thing. Defendant then talked, with Miss Francis about it. She denied the charge, and defendant says he then believed the clerks were mistaken. In May, 1892, defendant overheard a lady clerk talking about the dresses Miss Francis was having made (she was about to be married), and that she would not need to buy any for a long time. Defendant claims that he thought this strange, as he was owing her some $650 on her wages, and she seemed to be buying nothing at the store. On July 12, 1892, one of the clerks said to the defendant that he could stand it no longer, that he had seen Miss Francis taking goods out of the store when the defendant was absent, and that she had taken a lot of shoes that day. On the next day the defendant took a search warrant, and, with an officer, went in the evening to the dressmaking rooms of Miss Towne over the store, where they found a large quantity of goods in packages claimed by defendant to be his. They then went to the house of Miss Towne, where she and Miss Francis were. They denied that any of defendant’s goods were there, but, upon search being made in the rooms, they found other goods claimed by defendant. Some of the goods found at the house were claimed by Miss Francis, and were given up to her. The balance of the goods were all turned over to the defendant. Later Miss Francis and Miss Towne asserted title to a few of the articles taken, and all the rest were put back into the stock of the defendant, and retained by him. The articles taken on the search warrant' are too numerous to mention. They consisted of dress goods, mitts, gloves, shoes, napkins, towels, sheeting, table linen, handkerchiefs, laces, veiling, ribbons, etc., amounting at retail prices to upwards of $600.

On the trial Miss Francis was called as a witness, and acknowledged that she took these goods from the store of the defendant. The reason given by her for taking them was that she intended to return some; that she had heard Mr. Hurd was in debt, and she was in doubt about getting her pay, but when he settled with her she intended to allow him for the goods. She was asked if she had kept any account of the goods, and said she had not, only in her head. Being asked how much she figured the goods in her head, she said about $75; asked how long before that she conceived the idea of taking the goods for her pay, she said, “Some seven or eight weeks.” She had been taking goods for some two years prior to this.

It appears that on the morning of July 14th the officer went to the farm of Mr. Francis, and told him about the occurrence. Both parents came to Lansing. Mr. Francis went to see defendant, and Mrs. Francis went to see her daughter at the home of Miss Towne, talked with her there, and went to defendant’s store, where she found her husband and defendant in conversation. Defendant told of the goods he had found, and stated his belief that Miss Francis had been taking goods for a long time, and that he could not tell how much he had lost. There was no talk of a settlement at this interview. Plaintiff and her husband then went to see their daughter, and talked the matter over with her. They also talked with the officer and Miss Towne. They then, returned to the defendant’s store, and at this interview there was talk of a settlement. Plaintiff was asked, on the trial:

“How did you come to make a settlement, and what was there to it ?
“A. Well, Mr. Francis asked him what was the least that he could settle for, and he said $2,000 and her wages, and make up B. & L. money to $500, and that was the least, and that was less than half of what he expected to get. * * * Mr. Francis said that he could pay no such sum, and that he would have to take her body, — she was out from under his reach; and he said that he would have to have her arrested, or something of that kind, — that would only take her body, — and that was the last that he said. Mr. Francis then said, ‘Come, we are going home.’ But I did not go. I stayed there, I presume, two minutes, and Mr. Hurd came up and said, ‘You can settle it.’ He said he would settle it for $500 and her wages. * * * I said, ‘I will give it.’ * * * The next day we came to town. Mr. Francis-did not go to see Mr. Hurd again. I did, after I got the money. I borrowed the money myself of Mr. Wilbur, — gave my note for it. * * * Then I went and got a receipt made out, and took it to Mr. Hurd, and he signed it, to the amount that he was owing Ella and the amount that I paid him. I paid him the money. * * * The receipt was drawn at Mr. Twaits’ office. No one went with me to get the re'ceipt drawn. My husband did not go with me.”

According to the testimony of the plaintiff and her husband, nothing was said by defendant about arresting their daughter at any time while the settlement was being made. But plaintiff contends that, during the night when the goods were taken, the defendant was at the house of Miss Towne with the officer nearly all night, urging Miss Francis to go out to her father that night and have it settled up. Plaintiff, however, does not claim that her daughter told her of any threat of arrest. She had seen the goods found by Mr. Hurd. Her daughter had told her that she had taken goods which she had neither paid for nor charged on the books, and she had talked with her daughter about making a settlement. She knew no complaint had been made, and she understood she had authority to make a settlement for her daughter, and allow Mr. Hurd to keep her wages in settlement.

It is difficult to read this record and come to any other conclusion than that the defendant, under the circumstances shown, had reason to believe that Miss Francis had intended to steal these goods. The plaintiff, however, testified that she did not believe, either at the time of the settlement or at any other time, that her daughter had stolen. The declaration avers that the duress arose from a false and fraudulent claim that Miss Francis had been stealing, and would be arrested and prosecuted for the larceny unless settlement was made. Under the undisputed facts in this case, it is apparent that the claim made by the defendant that Miss Francis had been stealing goods was not fraudulent. He had good reason to believe, from all the facts and circumstances, that such was the case; and there is no proof of any threat to arrest or prosecute.

The fact that Mr. Hurd had good reason to believe that the goods were stolen by Miss Francis is better shown by reference to some of the articles taken, and the time when taken, as shown by the testimony introduced by defendant. There were garments of woolen underwear found, which Miss Francis says she took for her mother, which were taken in the spring, and which lay in the shop of Miss Towne for weeks. There were two infants’ dresses found, which Miss Francis says were sent up to Miss Towne’s room by mistake, in a box supposed to be empty. They were wrapped by Miss Towne in a package, the name of Miss Francis written on them, and thrown upon a shelf in a closet. The store where they belonged was just below. There was cottonade for clothing, which Miss Francis says she took for her father, which had lain for weeks in Miss Towne’s room. There was heavy barege veiling, taken to be made up some time, — taken in the summer. There were shoes at the house of Miss Towne, which had been taken there, as claimed, to be tried on by Miss Towne, which had remained there for days; and there were four pairs of shoes found in Miss Towne’s shop. In all, seven pairs of ladies’ and one pair of men’s shoes were recovered. Testimony is given in the ease by the clerks- of defendant, whose suspicions were aroused as to the conduct of Miss Francis, and to which defendant’s attention had before been called. She frequently — perhaps once in two or three weeks — got small silver changed into bills by the bookkeeper in the store. This covered a period of two or three years. She also changed silver into five and ten dollar bills at the stores of other merchants near by at different times. The testimony also shows that she carried on a traffic in goods with girls in the shop of Miss Towne, selling them and taking money for them, frequently taking goods from the store, not paying for or charging them. These things were noticed by the other clerks. . When asked at the house of Miss Towne, on the night the goods were taken, if any goods were there belonging to. Mr. Hurd, she denied there were any such, and yet large quantities were so found; and finally, when pressed for the reason for taking them, she asserts that she thought she would not get her pay, and she intended to account for them in a settlement with Mr. Hurd. Something over $600 worth of goods were taken. She kept the account in her head, and estimated the value at $75.

We think the admitted facts negative any duress. Duress implies a constraint which overcomes the will. While this may be brought about by threats of prosecution for a criminal offense, yet in this case we find no such threat; and the mere fact that the defendant was pressing payment of a debt which he believed to be his due can in no sense be held illegal. It was a matter of dispute as to how much the debt was, — just how much was the value of the goods the daughter had taken during those years. The plaintiff was authorized by her to make settlement. She made it after a full and fair understanding as to what she was settling for. There was no haste about it. She arranged it voluntarily one day, and paid the amount the next. She went to a, lawyer, and had the receipt drawn, which fully covered the settlement. It is said that, the defendant having attempted to impress upon the plaintiff the fact that Miss Fra,neis had confessed her guilt to him, this operated upon the mind of plaintiff, and influenced her in making the settlement. But the plaintiff testifies that, at the time she made the settlement, she did not believe her daughter was guilty of having stolen anything, or was guilty of the crime charged. It is not apparent, from these facts, how the plaintiff was deceived, nor how, by such deception, she was induced to make the settlement.

At the close of the testimony, defendant’s counsel asked the court to charge that plaintiff could not recover. This was refused. While there may be some evidence in the case which warranted the court in refusing to instruct a verdict for the defendant, yet, under the facts shown and the circumstances surrounding the case, we think the court was in error in refusing certain other requests to charge. No tribunal would have the right to disturb the compromise and settlement, except upon evidence of fraud or unconscionable advantage, as no threats to institute criminal proceedings are shown; so that the real question which should have gone to the jury was whether the defendant was acting in good faith, and making a demand of payment for goods and property which he actually believed he had lost. In view of this, the following requests should have been given, or the substance of them embodied in the general charge:

“5. It is admitted by Mrs. Ella Urch [Miss Francis] that she had, from time to time before the 14th day of July, 1893, been taking goods belonging to Mr. Hurd from his store without paying for them, and without charging them to herself, unknown to Mr. Hurd. Under these circumstances, she must be held chargeable with the reasonable suspicion arising from those facts. If Mr. Hurd, learning of these facts from his clerks, suspected or believed that Miss Francis was stealing goods, the fact whether or not she intended to commit the crime of larceny is not important. In other words, Mr. Hurd had the right to act upon the information received by him upon this subject, and, after finding the goods in the rooms of Miss Towne and at the house of Miss Towne, he had the right to suspect and believe that other goods had been taken under similar circumstances.' He was not obliged to accept the statement of Ella Francis that she did not commit the crime of larceny, and his conduct thereafter is not to be measured or determined by the actual guilt or innocence of Miss Francis.
“6. If the defendant claimed to the plaintiff that her daughter had been stealing goods and money from him, and the plaintiff, after hearing his statement of the facts, and her claim that she had never stolen anything from the defendant, nevertheless paid to defendant the sum of $500 in settlement of the defendant’s claim, she cannot recover the money so paid.
“7. If Ella Francis did take and carry away the goods of the defendant, intending to steal them, then the defendant did not in that regard make any false charge to the plaintiff. If plaintiff’s daughter took goods of defendant, and did not in fact intend to steal them, but to some time pay for them, or have them charged to herself, she is responsible for the belief likely to be excited by her acts in this direction. And if the plaintiff, after hearing the statement of Mr. Hurd, and also that of her daughter, the claim of guilt on the one hand and of innocence on the other having been made to her, determined to pay and did pay the defendant money, she cannot recover.
“8. If the statements made by defendant to plaintiff-were such as the conduct of Ella Francis, the finding of the goods, and the information received by defendant from his clerks rendered reasonable, and plaintiff, hearing them and also hearing the story of her daughter, herself believed that her daughter might have taken goóds or money not recovered, and that it was proper to pay to Mr.* Hurd the sum of $500, she cannot recover, even if her daughter did not in fact intend to steal the goods.
“9. If the daughter of plaintiff had stolen goods from defendant, or if she had taken them and not paid for them or accounted for them, but without intending to steal them, in either event defendant was entitled to be paid for goods so taken. If the circumstances were such that, whether the goods were or were not stolen, it was likely or probable that other goods than those recovered had been taken, Mr. Hurd, acting upon all the facts as they appeared, had the right to demand pay for such goods. If plaintiff, after hearing the facts or claimed facts, both from Mr. Hurd and from her daughter, paid to the defendant the money, she cannot recover.
“10. If the jury should reach the conclusion that Ella Francis did not intend to steal the goods, that would not necessarily be decisive of the case. The plaintiff’s daughter admittedly took some goods out of the store without paying for them or giving any account of them to Mr. Hurd. Under such circumstances, Mr. Hurd was not bound to take her statement as to the quantity or value of the goods so taken. He had a right to assume that others had been so taken, and to make his own estimate of them. And if the plaintiff, after talking with defendant and her daughter, consented to pay $500 in settlement of defendant’s claim, she cannot recover it.”
“13. The undisputed testimony in this case shows that for several years prior to the 14th day of July, 1892, Ella Francis, now Mrs. Urch, had been employed as a clerk in defendant’s store at North Lansing; that, for several months just prior to July 14th, she had been taking goods out of defendant’s store that did not belong to her; that she neither paid for such goods, nor gave an account of them, nor had them charged to her upon defendant’s books; and that the fact that she had taken them, and the amount she had taken, was not known to Mr. Hurd until he was informed by his clerks, and the goods or some of them were found by the officer having the search warrant for that purpose. Under such circumstances, Mr. Hurd was not bound to accept Mrs. Urch’s statement as to the amount or value of the goods so taken by her. He had a right to assume, for the purpose of settlement, that she had taken other goods besides those found, and to put his own estimate upon the value of such goods. And if the plaintiff, under the circumstances proved in this case, there being no evidence of duress or of constraint put upon her, saw fit to pay the sum which defendant said he was willing to accept in settlement, she cannot recover it back in this suit.
“14. If Mr. Hurd, falsely and without pretense of right, represented to Mrs. Francis that her daughter had been wrongfully taking goods out of his store, when in fact she had not been, and by such false pretense induced Mrs. Francis to pay him $500, she may sue and recover it of him in this action. But if her daughter had, as a matter of fact, been taking goods out of defendant’s store that did not belong to her, and without the knowledge of Mr. Hurd, and if lie had no means of knowing the extent or value of the goods thus taken, he had a right, in case the plaintiff proposed a settlement for such goods, to put his own estimate on his loss, and the plaintiff had the right to pay it or not, as she chose; but, if she paid money under such circumstances, she cannot recover it in this suit.
“15. If plaintiff voluntarily paid defendant the money she claims to have paid, she cannot recover it in this suit, unless the defendant deceived the plaintiff, and induced her to pay the money by false and fraudulent representations as to the facts.
“16. If plaintiff’s daughter had been taking goods out of the defendant’s store from time to time without defendant’s knowledge, under such circumstances as might reasonably lead the defendant to believe she had stolen them, and if this wrongful conduct had been going on for so long a time that defendant did not have the means of knowing the extent or value of the goods so taken, he had a right to estimate such loss at such sum as he believed would indemnify him; and any statement made by him, to the effect that his loss might be one, two, three, or six thousand dollars, if accompanied by the further statement, made in good faith, that he did not know and had no means of finding out just how much his loss was, would not, under such circumstances, be false and fraudulent. And if the plaintiff, knowing these facts, and that defendant’s claim was in the nature of an estimate, and did not purport to be an accurate statement of his loss, voluntarily paid the money, she cannot recover it.
“17. The plaintiff had a right to settle with the defendant, and to pay him for any goods wrongfully taken by her daughter out of his store; and, if the exact quantity and value of the goods so taken was not known, the parties had a right to agree upon a sum that should be paid and accepted in settlement. If they did agree upon such settlement, and the money was paid in pursuance to it, it is binding upon both parties, and the plaintiff cannot recover.”

The judgment must be reversed, and a new trial ordered.

Montgomery, Hooker, and Moore, JJ., concurred with Long, C. J.

Grant, J. I think the court should have directed a verdict for the defendant.


author: Grant, J. Hooker, J.

text:
    LONG v. EVENING NEWS ASSOCIATION.
    1. Fraudulent Conveyances — Evidence—Libel—Malice.
    Evidence that a demand for the retraction of a libelous article was not complied with by the publishers is inadmissible in garnishment proceedings based upon the alleged fraudulent transfer of the newspaper assets pending an appeal from a judgment for the libel, since the inference of malice to be drawn therefrom would go no further than the judgment itself towards showing a motive for a fraudulent disposition of the property.
    2. Trial — Argument op Counsel — Prejudicial Remarks.
    That one is the managing director of a newspaper will not justify counsel in referring to him, in garnishment proceedings for the amount of a judgment against the paper for libel, as the man "who sits in his sanctum, where nobody can see the hand that writes, nobody can see the brain that works, and writes sensational articles against citizens of his own town, as he wrote the article on which this judgment was rendered,” where the fact that such person had nothing to do with the publication of the libelous article is established by the court’s having directed verdict in his favor in the original suit.
    3. Fraudulent Conveyances — Consideration.
    The fact that the tangible assets of a newspaper, whose transfer of all of its assets to another paper in payment of a debt is attacked as fraudulent by a judgment creditor, did not exceed in value the amount of the indebtedness,, will not necessarily relieve the assignee from liability in garnishment, where no account was taken of intangible assets. Grant, J., and Long, C. J., dissenting.
    4. Same — Intangible Assets — Personal Franchise — Good Will.
    That a franchise of the assignor in the Associated Press was transferable only with the consent of the association, and that its business had for several years been conducted at a loss, is insufficient to show that the franchise and good will were properly disregarded in the transaction as of no value; it being for the jury to determine, upon proper evidence, whether their inclusion without compensation was in fraud of creditors. Grant, J., and Long, C. J., dissenting.

      Error to Wayne; Aldrich, J., presiding.
    Submitted February 11, 1897i-
    Decided May 28, 1897.
    Garnishment proceedings by John H. Long against the Evening News Association, as garnishee of the Tribune Printing Company. From a judgment for plaintiff, the garnishee defendant brings error.
    Reversed.

      Elliott G. Stevenson, for appellant.

      Levi T. Griffin and C. E. Warner, for appellee.
   Grant, J.

Plaintiff recovered a judgment in a libel suit against the defendant Tribune Printing Company, December 18, 1894. The case was affirmed in this court December 3, 1895. Sée 107 Mich. 207. December 9, 1895, execution was issued and returned unsatisfied. January 21, 1896, plaintiff instituted this proceeding in garnishment against the Evening News Association, which filed a disclosure that it had no property, money, or effects in its hands belonging to the Tribune Company. In February and March, 1895 the Tribune Company had sold and conveyed to the News Association all its prop-, erty and assets. The theory of this suit is that these conveyances were fraudulent as to the creditors of the Tribune Company, and that therefore the News Association held the property in trust for said creditors. Plaintiff recovered verdict and judgment. Such further facts as are essential will be stated in connection with the points discussed.

One of the counsel for plaintiff, in his argument, used the following language:

“Mr. Scripps supposed he could’ sit in the Tribune room or the Evening News room and blacken the character of a respectable citizen. You find him sitting in his sanctum, where nobody can see the hand that writes, nobody can see the brain that works, and there he scribbles and writes sensational articles against citizens of his own town, as he wrote the article on which this judgment was rendered. Now, gentlemen of the jury, Mr. Scripps has set out — First, as the evidence shows, to libel John H. Long; second, to procure able counsel, as he testifies to himself, to defeat J ohn H. Long upon the trial of the case. In that he failed to succeed. And it appears, on a trial by jury and by the highest court in the State, it was adjudicated that James E. Scripps did libel John EL Long, a,nd he ought to pay the amount of judgment for it. Mr. Scripps says, ‘ I will go before another jury and another judge, and I will get another counsel, and I will yet defeat John H. Long so far as his ability to secure any payment of the debt is concerned.’ James E. Scripps, known in this community as a large-moneyed man, now comes into this court to defeat a policeman who worked for two or three dollars a day, and defeat him against a judgment which he had obtained.”

In view of the fact that Mr. Scripps had nothing to do with the publication of the libelous matter, and that for that reason the court, in the libel suit, directed a verdict in his favor, the impropriety and injustice of the language are apparent. Its natural tendency was to greatly prejudice the jury. Its use cannot be defended upon the ground that Mr. Scripps owned most of the stock of the company, and was the managing director, and that therefore “theoretically it was his hand that wrote” and “his brain that worked.”

Counsel were permitted to show that plaintiff had demanded a retraction of the article before he brought his libel suit, and that no retraction was made. Counsel seek to defend the admission of this evidence under the liberal rule applicable to cases where fraud is charged, and they insist that in some manner it tended to show a motive for the transfer. We think that this testimony was incompetent and immaterial. The record contains no evidence tending- to show that the sales to the News Association were made with any reference to the plaintiff’s suit, which was then pending in this court. If plaintiff has a right of action against the defendant, it is because the law attaches a liability from the undisputed facts, and not because of any intent to defraud; or, to state the proposition .otherwise, the transaction is a fraud in law, but not in intent.

James H. Stone, a former publisher of the Tribune, was called as a witness for plaintiff. He testified that, when he was connected with the Tribune Company, it had the franchise of the Western Associated Press, as did also the Free Press; that in January, 1891, when he sold out the establishment to Mr. Scripps, the circulation of the daily was 12,000 to 13,000, and of the weekly somewhat in excess of that; that the sale carried with it the entire property and “good will of the institution;” and that the price, including the liabilities assumed by the purchaser, was $90,000. The price paid was promptly held by the court to be incompetent. On cross-examination the witness testified that, during the 4£ years of his management, the company had lost $37,000, and said:

“It is difficult to state what the good will of a paper might be worth, suppose the paper had lost eight or nine thousand dollars a year for four years, and then continued to lose for four years more. Conditions surrounding a newspaper affect its value, and franchises might increase or decrease the value, without reference to the actual earning results. A franchise could be transferred subject to -the confirmation of the association. I think, if the Tribune Company were hard up, or another newspaper company, my judgment would be that the franchise would be of value for the purpose of sale by the company. Its transfer would be subject to the confirmation of the association to which it belongs. It requires consent.”

It had already appeared in the case — and is undisputed —that for four years after the sale by Stone, and to the time of the sale to the defendant, the Tribune Company had lost about $100,000. The following questions were then propounded and answered:

Q. And with a paper that has lost money during your experience, as you have stated, and lost during the next four years an amount exceeding $100,000, and was then without resources of its own, what would you say, as a newspaper man, as to the fairness of an arrangement by which its assets and property of all kinds was transferred to the News Association, to furnish the capital and conduct the paper, and return to the stockholders one-half of any profits made ?
“A. I can’t judge whether it would be fair and reasonable without a knowledge whether it was the best thing that could be done. If nothing else could be done, and the concern was unable to continue, it might be the wisest course. At the same time it might have been possible to have sold the paper for more than they realized in that way.
“ Q. Do you think it possible to sell a paper that has lost in eight years $150,000, and is then in debt sixty-five to seventy thousand dollars, with tangible assets of less than one-half that amount ?
“A. I think such things are done at times when the fool-killers are asleep. Such things are not very rare.”

On redirect examination he was asked to give what he regarded as the elements of value in a newspaper, to which he replied:

“First, I should regard field and opportunity; second, good will; third, condition of organization of the enterprise. That would include most everything, like its franchise, etc.”

Under objection and exception the witness was then asked:

“Q. You know what the Associated Press is and' you have already stated what it is. What, in your judgment, would be the value of a franchise, in the city of Detroit, like the Associated Press or the Western Associated Press, — either of them ?
“A. It might be worth more to you than to me. All those matters come, to a certain extent, under the head of opportunity and the capacity to make use of. I have known times in the last 10 years when I should regard the value of the Associated Press franchise in the city of Detroit worth $100,000. (Stricken out on motion. Question read.)
“Q. Confine your answer to January, 1895.
“A. I should regard a franchise in the Associated Press as worth all the way from $20,000 to $100,000, according to the circumstances of the business and the opportunity and capacity of the purchaser to use it.”

We do not think that this opinion of the witness was competent. His opinion was but a mere guess, and furnished an opportunity for the jury to guess. Outside the value of this franchise, there was no evidence to show that the tangible assets of the Tribune Company were worth any more than the price paid for them and credited on the debt due from that company to the News Association.

The learned trial judge, after instructing the jury “that, if such transfer [of the tangible assets] was a bona fide conveyance of such property for an adequate price to satisfy an actual indebtedness, then such transfer would be valid, even though its effect would be to defeat the other creditors of the said the Tribune Company,” instructed them as follows:

“If you find that thereafter the Tribune Company possessed no other valuable property interests, rights, and franchises than the good will of its business and contracts with news associations, then the defendant would be entitled to a verdict, because such property would not be subject to levy and sale under a writ of execution, and even if you should believe that it was transferred to the Evening News Association for the purpose of defrauding the creditors of the Tribune Company, yet it is not such property that, when separated from the tangible assets, can be reached in proceedings of this kind. And there is no proof that any profits have accrued to the defendant by the use of such good will and franchises.”

While the good will of such a business and the franchise of the press association may be the subject of contract between vendor and vendee, it needs no argument to demon, strate that a judgment creditor cannot get title to either by an execution sale. The judgment creditors may sell all the printing presses and other personal property, but the purchaser would not thereby acquire the right to publish the Tribune and receive the benefits of the good will and franchises of the business. The company might at once purchase or rent new presses, etc., and continue its publication. The entire assets of a partnership may be sold on execution, but the sale does not carry with it the good will of the firm. Nearly all the cases cited by counsel relate to the rights of partners inter sese. There are, of course, cases where the good will attaches to the property itself, and not to the business or partnership. In such case the business and the property are inseparable. Chittenden v. Witbeck, 50 Mich. 420. In Wedderburn v. Wedderburn, 22 Beav. 84, it was held that the good will of a business does not belong to the surviving partners except by express agreement. See, also, Fenn v. Bolles, 7 Abb. Prac. 202. In Hathaway v. Bennett, 10 N. Y. 108 (61 Am. Dec. 739), it was held that the route of a newspaper carrier might be the subject of sale, like the good will of a trading establishment or the ride of a physician, but it, ipso facto, gave the purchaser no right of action against the publisher. It is there said: “Amere privilege may be the subject of sale if the purchaser is willing to run the risk of failing to enjoy it.” So this press franchise would be of no validity or value to the vendee of the Tribune Company, unless the press association and its members in Detroit consented to the transfer. But of what value can the good will and a nontransferable franchise be to a business which for years had been losing money at the rate of $25,000 per year?

5. At the time of the transfer, as appears by the evidence in behalf of the plaintiff, the Tribune Company was indebted to the News Association in the sum of $37,000, and the jury so found. There is no evidence that this was not a bona fide indebtedness. The price of the press and other property transferred January 11th was $11,000. The price of the other property transferred in the following month was $24,287.95. These comprised all the tangible assets of the Tribune Company, and, according to the undisputed evidence, were worth $35,287.95. After that time, and before the writ of garnishment was served, the defendant had paid other debts of the Tribune Company, amounting to $30,000. It thus appears that the tangible assets of the Tribune Company were not equal to its debt to the defendant at the time of the sale. The only basis on which a judgment in garnishment can be rendered against the defendant is that it had money, property, or effects in its possession or control belonging to the Tribune Company, and which it may produce in response to the writ, or that such property was fraudulently conveyed to it, which it refuses to produce. A defendant in garnishment may either produce the property in his hands or permit judgment to go against him for its value. These assets must be tangible, not intangible. In view of the fact that the Tribune Company had done a losing business, and during the nine years preceding this suit lost about $137,000, it is evident that the mere fact that the good will of the business and the press franchise were not given a value, if they were included in the sale, is not evidence of fraud in the transaction, nor do they constitute tangible assets for which the defendant can be held liable as garnishee.

But the claim is that this franchise and the good will of the business were valuable, and that the jury were at liberty, from this fact alone, to find that the entire transaction was a fraud, and that therefore the tangible assets, which were conveyed to the defendant for their full value, became subject to garnishment. To illustrate: A., a physician, sells to B., another physician, his books, instruments, office fixtures, and accounts for $5,000, their full value, and also conveys to him the good will of his business. C., a creditor of A., may sue A. and garnishee B., and attack the sale as fraudulent, because no price was fixed for the good will of the business. So, too, under the supposed case, if the good will of the business were sold at $1,000, a jury might find the transaction fraudulent, because in their judgment it might be worth $5,000, if they could find another physician to swear that in his judgment it was, and that, too, in face of .the fact that A. had not made a living, but had lost money in his practice. I am not aware of any case which holds such a transaction fraudulent, or open to attack by creditors. The purchaser in such case may be willing to pay even a large sum for the good will, thinking that by his superior skill and energy he may make it valuable; but this is no evidence of its actual value. So the fact that Scripps paid a large amount for the Tribune Company, with its record of losses, is not evidence of the value of its good will or of the press franchise which it had.

It may be proper to here note the transactions between the two companies as they appear upon the records. January 7, 1895, the following appears upon the record of the board of directors of the Tribune Company:

“J. E. Scripps moved that E. B. Whitcomb and George G. Booth constitute a committee to negotiate with the Evening News Association for the sale of the machinery and fixtures to the said Evening News Association, and to establish a rental to be paid to the News for the use of the plant. Adopted. E. B. Whitcomb moved J. E. Scripps and George G. Booth be a committee to submit to an adjourned meeting a plan for the lease of the Tribune to the Evening News Association for the purpose of securing increased economy in the operation of the various departments. Adopted. On motion, the stockholders took a recess for two weeks to await the report of the committee.”

On the same day the following action was taken by the board of directors of the News Association:

“On motion of J. S. Sweeney, the salaries of the managing director and manager were made the same as last year. J. S. Sweeney moved that the interest in the engine, boiler, electric plant, and presses now owned by the Tribune Printing Company be purchased at a fair valuation by this association for the simplification of the business, and then the Tribune be charged 10 per cent, upon the said valuation for the use of said plant. Also, that the president and secretary be a committee to arrange the transfer. Carried.”

In a few days trouble arose in the Detroit Typographical Union as to the transfer of matter between the Evening News and the Tribune. This resulted in the transfer of the balance of the assets and property of the Tribune Company to the News Association, under the following resolution, adopted March 6, 1895:

‘ ‘ March 6th. Meeting of directors at the residence of the president. Present: J. E. Scripps, J. S. Sweeney, George G. Booth. Mr. Booth offered the following: ‘ Whereas, in the interests of economical management, the mechanical department of the Evening News and Detroit Tribune have for some months past been operated jointly; and whereas, the requirements of the Typographical Union demand entire amalgamation of the two properties, if the existing advantages are to be continued; and whereas, the Tribune Printing Company, by its directors, has offered to sell to the Evening News Association the entire printing business, on terms which shall he fixed by the said Evening News Association: Therefore, resolved, that we pay the Tribune Company, as consideration for the property turned over to us, one-half the net profits that' may accrue from the publication of the morning, Sunday, and weekly issues, until such time as experience may show change or modification in this basis to be wise and just.’ Resolution seconded by Mr. Sweeney, and unanimously adopted. It is understood that, in reckoning the profits of the Tribune portion of the business, no account is to be taken of the interest on the Tribune debt, which is to be paid by the Tribune Printing Company.
“ On motion the meeting then adjourned.
“George G. Booth, Secretary.
“James E. Scripps, President.”

Nothing is said in these sales about the good will of the Tribune Company or the press franchise. If, however, we assume that the Tribune Company intended to convey them, this cannot affect the question. The result did not prove very profitable to the News Association, for it lost $10,000 the first year in carrying out the arrangement. We thus have the Tribune Company, which had always been a losing business, sold by Stone to Scripps; after four years more of failure- and heavy losses, sold by Scripps to the defendant; full value paid for all its tangible assets; the sale reasonable upon its face, at least as to the Tribune Company; the Tribune Company still in existence, and entitled to l’eceive from the defendant one-half the net profits which may result from the publication of its issues; and a jury permitted to find the transaction fraudulent upon the opinion of a witness who testified that it might be possible to sell a newspaper in the condition in which this was, “when the fool-killers are asleep.” I cannot yield assent to such a doctrine. The fact that a great majority of the stock of both corporations is owned by the same parties does not of itself stamp as fraudulent, either in fact or law, a transaction otherwise fair. It is not a fraud per se for one corporation, a debtor, to transfer its property to another corporation, its creditor, in payment of its debt, where there is no great undervaluation of the property. Spear v. Rood, 51 Mich. 140; Fraser v. Passage, 63 Mich. 556. We are aware of the rule found in the following cases: Cole v. Millerton Iron Co., 133 N. Y. 164 (28 Am. St. Rep. 615); Montgomery Web Co. v. Dienelt, 133 Pa. St. 585 (19 Am. St. Rep. 663); Grenell v. Gas Co., 112 Mich. 70; but they do not apply to this case, where full value was paid for the property.

Upon this record the court should have directed a verdict for the defendant.

Judgment reversed, and new trial ordered.

Long, C. J., concurred with Grant, J.

Hooker, J.

I concur in the reversal of the judgment in this cause. It was not disputed that the plaintiff recovered a judgment against the Detroit Tribune Printing Company for libel. It was not denied that all of the assets of the Tribune Printing Company were assigned to .the Evening News Association. The issue in the case was whether such assignment was a bona fide transaction, upon a sufficient consideration, and free from fraud of which its creditors could complain. This issue the defendant had a right, to suppose would be tried upon its merits, and it was under no obligation to try any other issue, or to be subjected to the danger of jurors’ prejudices being aroused by evidence relating to other matters, or by unwarranted appeals by counsel. Counsel insisted on showing, by cross-examination of Mr. Scripps, who owned the majority of the stock in each company, that the plaintiff had asked the Tribune Company to retract the libel which was the foundation of his judgment, and that it had never been done. It is now said that this testimony tended to show malice and vindictiveness upon the part of the Tribune Company. If there was a demand of retraction, which was not complied with, it is reasonable to suppose that it was not lost sight of in the trial of the libel case, and doubtless is to be found duly charged against the company in that judgment, which conclusively settled the question of malice against the company. The only possible view that would justify this evidence is that it had some influence upon the Tribune Company in the way of prompting it to fraudulently dispose of its property with a design to prevent the collection of the judgment, and we think the inference of malice or vindictiveness to be drawn'from a failure to retract would not go any further in that direction than would the judgment itself. Apparently counsel for the plaintiff did not offer it for this purpose, for not only did he not give that reason for offering it, but he objected to the defendant’s going into a rebuttal of the alleged claim of malice or vindictiveness, which it clearly had a right to do if it was a vital question in the case. This examination, and the manner in which it was conducted, was, in our opinion, well calculated to prejudice the defendant with the jury, and the judge should not have permitted it.

The same may be said of the language of counsel in criticising the witness Scripps. We are disposed to make all reasonable allowances for professional zeal, but we think this was not justified by any evidence in the case; and, if it was of any value to the plaintiff in the case (as we are bound to suppose that counsel considered it to be), it was rather in the direction of arousing the indignation of the jurors against Mr. Scripps and his company than in calling their attention to evidence which justified the conclusion that this transfer was made for the purpose of avoiding a judgment of small moment in comparison with the transaction between the companies.

The plaintiff, having garnished the defendant, attacked its purchase of all the assets and property of the Tribune Company as fraudulent, and based the claim of fraud largely upon the proposition that it obtained property in excess of its claim against the Tribune Company. Whether this was true or not depended upon the value of an Associated Press franchise, so called, and the good will of the business, which were acquired by the put-chase. It is claimed, perhaps correctly, that this franchise was not property which was subject to execution, being intangible; and it is said that it could not be reached by garnishment because intangible, and not subject to execution. But, if that be conceded, it does not, in my opinion, follow that such of the property as was tangible might not be thus reached. If the transaction was fraudulent, all of the property was taken subject to the rights of creditors. There was testimony tending to show that the press franchise was valuable. If it is a privilege which is essential to a daily newspaper, and one which is granted to but one or two newspapers in a city, it is reasonable to suppose that it would be a privilege much sought; and while it appears that the franchise, being no more than a contract personal in its nature, cannot be used by an assignee without the consent of the press association, it does not necessarily follow that it has no value, because it is possible that it can be made available by obtaining such consent, either under the existing rules of the press association or for a nominal consideration. If, as we gather from the case, this privilege is one that is granted to but one or two newspapers in the city of Detroit, there may be great benefit in obtaining a relinquishment of the right. If the franchise was valuable, there would seem a moral reason why the vendor (a debtor) should apply it to the payment of its debts. It is said that the creditor is not interested in the matter, because it is not subject to execution. Were it property exempted by law, we think this would be obvious, under decisions of this court; but we think the law should not erect a barrier against a creditor which has no more substantial foundation than the legal fiction that this right, resting in contract personal in its character, is of no value in the hands of the assignee, when it is obvious that it may be of great value as a matter of fact.

Again, the good will of the Tribune may have been valuable, although intangible, and, if so, its acquisition tended to increase the excess of the value of the property purchased over the purchase price. The effect of the theory of counsel would be to set off the assets called tangible against the purchase price, and to disregard the intangible assets because not subject to attachment or-garnishment, although it seems patent that the intangible property may have been of much value. Good will has been frequently held to have value, and to be subject to contract. In Chittenden v. Witbeck, 50 Mich. 420, it was recognized that it was valuable in connection with an hotel. It was there said: “By good will we suppose must be intended the favor which the management of the Russell House has won from the public, and the probability that the old customers will continue to give it their patronage for the future.” It would seem that an established newspaper might have a similar hold upon its patrons. It is not for us to pass upon the merits of this question, which is plainly a question of fact, and is for the jury or trial court.

The judgment should be reversed, and a hew trial ordered.

Montgomery and Moore, JJ., concurred with Hooker, J.