author: JONES, O. B., J.

text:
    CONTRACTS.
    [Hamilton (1st) Court of Appeals,
    July 30, 1913.]
    Swing, Jones and Jones, JJ.

      J. A. Eberhardt v. Hamilton Co. (Bd. of Comrs.)
    Extra Compensation to Cover Loss Resulting from Delay in Completing Street Improvement Contract, Denied to Contractor Advised of Conditions.
    A contractor, by the terms of a contract for a street improvement, advised that the running of electric cars thereon was not to be interfered with, that the tracks were to be readjusted by the railway company, and that the right was reserved to suspend the work at any time for the purpose of reconstructing said tracks and no claim for damages was to be made by reason thereof, will not after final completion of the work be allowed damages because of protracted delay in the readjustment of the tracks which made it necessary to do the work under unfavorable and more expensive conditions.
    Error.

      Joseph W. O’Hara, Gideon C. Wilson and Joseph Wilby, for plaintiff in error.

      Pogue, Campbell & Groom and Ireton & Schoenle, for defendant in error.

      Affirmed, no op., Eberhardt v. Hamilton Co. (Comrs.) 60 Bull. 113; 91 O. S. 000.

   JONES, O. B., J.

The ease below arose upon an appeal made to the court of common pleas by J. A. Eberhardt from the action- of the county commissioners of Hamilton county, rejecting his claim for damages growing out of a contract between him and the county commissioners for the improvement of Carthage pike through the villages of Carthage, Elmwood and St« Bernard in said county.

The contract provided for the grading and paving of said pike with granite blocks. In the center of said roadway were double street car tracks which plaintiff claimed said commissioners failed to have removed so that he could proceed to make such improvement without interference therefrom. The record shows that at the time the work was commenced there was some controversy between the street railway company operating on said tracks and the village of Carthage with regard to the operation of said street railway and the right of the company to maintain such tracks to operate in the manner it was then doing, and because of this controversy no arrangement was made by said street railway company at the time the paving was commenced by the contractor for the relaying' and readjustment of said tracks, but the paving was laid between the curb and the .end of the ties on either side of said tracks before any paving was done in the center. Plaintiff in error contended that this method of operation was not contemplated by the parties at the time the contract was made, and that it had entailed heavy additional expense upon him by reason of being compelled to work in narrower quarters which prevented adoption of the usual method employed in such construction work. The basis of his entire claim is practically the additional expense claimed to be caused by the complications arising out of relaying the street car tracks.

The case below was tried before a referee appointed to take and report the testimony and his findings of fact and law. An extended trial was had, and the testimony and exhibits, with the report of the referee, are embodied in the bill of exceptions consisting of eight bound volumes of typewriting. The report of the referee was adverse to the claim, 'and the court below entered a decree overruling the exceptions of Eberhardt to the report of the referee, and confirming the report dismissing the appeal. A motion for a new trial was filed by Eberhardt, which was overruled by the court. To reverse that judgment and decree the error proceedings are brought in this court.

The specifications under which the work was done provided, in Sec. 1, that:

“Each party will examine the location of the work and judge for himself as to all of the circumstances affecting, it. No information derived from official or other sources will release the contractor from fulfilling all of the conditions of the contract. ’ ’

And the contractor admitted that he had looked over the ground and knew of the existence pf the street railway tracks, and knew of the provisions which were embodied in the contract in Sees. 35 and 13, which are respectively as follows: ' .

35. “Street Railway Tracks. Where the roadway is to be occupied by street railway tracks, they will be readjusted, renewed and placed in position by the railway company, to the lines and levels given by the engineer, and all expenses pertaining to the laying of the street railway tracks shall be paid for by the railway company *' * * but all work within the rails of said tracks, such as paving with granite and foundation, shall be done by the contractor for the street improvement as contemplated in these specifications.
“Where, in the opinion of the chief engineer of the board of county commissioners it is not necessary to renew the track stringers or cross-ties of the street railway tracks, the said tracks shall be adjusted as required of the specifications, and the subgrade of foundations be thoroughly compacted by the contractor with rammers at all points inaccessible to the roller, and without disturbing the tracks. * * * Where electric railway tracks are laid prior to the pavement, the contractor will be required to construct street, including the laying of pavement, without interrupting the running of electric cars. The contractor will also be required to pave between and alongside all street railway rails that are or may be laid of whatever pattern, cutting the blocks to fit the level of said rail without additional compensation to that bid for paving.”
13. “The right to construct or reconstruct any electric railway * * * at any time prior to the completion of the road covering over the line of the same, is expressly reserved by the board of county commissioners, and the contractor shall not be entitled to any damages by reason thereof, and said board of county commissioners reserve the right of suspending the work on any part of said street for the purpose above stated without compensation to the contractor for said suspension, but shall extend a corresponding time for completion of said work.”

It is clear, therefore, that the contractor was advised that the running of the electric cars was not to be interrupted by his work, and that the street railway tracks were to be adjusted by the railway company, and that the commissioners reserved the right to suspend work on any part of said street at any time for the purpose of constructing or reconstructing such electric railway, and that no claim for damages by reason thereof should be claimed. And under Sec. 5 of the specifications the right to change the method of construction in any particular was reserved to the engineer, subject to approval by the commissioners, and the contractor agreed not to claim damages on account thereof.

The record fails to show any interference by the commissioners on behalf of the county with the work of the contractor, that was not permissible under the terms of the contract, or that would in any way entitle the contractor to a claim for damages other than the extra amounts that were allowed him in the payments already made for the work. The contractor at the outset was met with the proposition that the car tracks would not be immediately readjusted in Carthage, where the work was begun, and he proceeded with the work under this condition. And this condition continued up to the time that he himself obtained from the traction company a contract for readjustment and relaying of said street ear tracks, which was on October 27, 1903. Any claim, therefore, that he might properly make an account of the interference of the street railway tracks would be limited to the period before the time when he became responsible for the work of relaying said tracks.

The work of construction extended over a much greater period of time than that fixed by the contract, and it is apparent from the record that the work during the first part of the entire period was more expeditiously and cheaply done than that during the latter part of the period, and it is shown by the testimony of one of the witnesses — an engineer named Innes, called by the county and not disputed — that the cost of the part of the work in Carthage where the interference of the street railroad tracks existed was cheaper than the corresponding work at the southern 'part of the improvement where no such interference existed.

The court is of the opinion that the plaintiff failed to prove any damages caused by any act or failure to act on the part of the county commissioners or under the terms of their contract. A careful examination of the record fails to disclose any error in the proceedings below prejudicial to the plaintiff in error. Judgment of the court below is therefore affirmed.

Swing and Jones, E. H., JJ., concur.


source: Caselaw Access Project

license: Public Domain

text:
    BOUNDARIES.
    [Hamilton (1st) Court of Appeals,
    February 22, 1913.]
    Swing, Jones and Jones, JJ.
    Louis Helbling et al. v. Week Realty Co.
    Boundary Line Accepted as the True Boundary for More than Twenty-One Years Becomes the Estabh'shed Boundary Line.
    Where the deeds of adjoining landowners call for the section line as the boundary line, and a fence maintained for more than twenty-one years on the supposed section line was treated by both landowners as the true boundary, the line as so marked becomes fixed as the true line, and can not be changed against the will of either owner by a survey which shows that the'old fence did not follow the true section line.
    Error.

      L. H. Pummül, for plaintiffs in error.

      Thorne Baker, for defendant in error.
   JONES, O. B., J.

The action below was a proceeding to enjoin defendants from trespassing and entering upon premises claimed by plaintiff and from taking down and carrying away a fence which it had placed upon what it claimed to be the boundary line between the lands belonging to the respective parties.

Defendants by answer and cross petition denied the title and possession of plaintiff and claimed title and possession themselves in the strip of land in dispute, by adverse possession. Issue was joined by reply and a jury was waived, and the cause was heard and submitted to the court. The court found for the plaintiff and that the line between plaintiff and defendants’ lands was the true section line, being a straight line from one section corner to the other, and entered a perpetual injunction as prayed for. To this decree defendants prosecute error.

The question to be determined in this case is the division line between the parties. The description of the respective tracts of land in the deeds each called for the section line as the boundary. The evidence shows that as early as 1868 the different owners of these tracts had constructed and maintained from time to time a fence upon a line to which each had continuously occupied, and while the land now owned by plaintiff had been in woods and uncultivated, that owned by defendants had been plowed and cultivated dowm to the line of the original fence, and while these fences had become dilapidated, plaintiff or its predecessors in title had recognized this line by placing stones therein in the AVerk partition in 1894 or 1895 and by building a pasture fence upon it. And it was only at about the commencement of this suit when the straight line was run by Engineer Burke from one section corner to the other and plaintiff first built its fence upon it, that any question was raised as to the old fence line not being the true section line..

These facts bring the case directly within that of Yetzer v. Thoman, 17 Ohio St. 130 [91 Am. Dec. 122], in which the syllabus is as follows:

“AVhere one of two proprietors, respectively, of adjoining lands holds actual, continuous, notorious and exclusive possession up to a certain line, though not originally the true one, for the full period of twenty-one years, the statute of limitations applies in its favor, and against the adjoining proprietor, although such possession may have grown out of the mutual mistake of the parties respectively in respect to the locality of what was originally the true line between them.”

And following this case, the question of whether there had been a mistake in the line or what the motives of defendants or their predecessors in title had been in so occupying to the old line becomes immaterial.

Judge Brinkerhoff in the opinion of the court, in the. above case at page 132 uses the following language:

“We think under our statutes of limitations, if a party establish in himself, or in connection with those under whom he claims, an actual, notorious, continuous and exclusive possession of land for a period of twenty-one years, he thereby, except as to persons under disability, acquires a title to the land; and this irrespective of any question of motive or of mistake.”

Nor do we think that the testimony of the witness Marshall, whose wife had owned the land and conveyed same to Helbling, can be said to toll the statute of limitations. He admitted that he knew nothing of the subject of the controversy or the fences or the boundaries. Nothing in his testimony contradicts other evidence showing occupancy to the old line.

“Where th? statute of limitations is interposed in an action of ejectment and it is shown that the original seizure was a disseizin, any subsequent act or declaration of the claimant or his predecessor in title which does not estop the claimant to plead the statute nor suspend the right of the holder of the title to prosecute an action to recover possession, will no be- sufficient to arrest the running of the statute. Neither a mere offer to buy within the twenty-one years, nor an acknowledgment by the claimant within that time that the title is in another, or that the claimant does not own the land; will have that effect.” McAllister v. Hartzell, 60 Ohio St. 69 [53 N. E. Rep. 715].

And in the opinion in this case, Spear, J., quotes with approval at page 90 from French v. Pearce, 8 Conn. 439 [21 Am. Dec. 680], this language:

“The possession alone, and the quantities immediately attached to it, are regarded. No intimation is there as to 'the motive of the possessor. If he intends a wrongful disseizin, his actual possession for fifteen years gives him title;' or if he occupies what he believes to be his own, a similar possession gives him title. Into the recesses of his mind, his motives or purposes, his guilt or innocence, no inquiry is made. It is for this obvious reason, that it is the visible and adverse possession, with an intention to possess, that constitutes its adverse character and not the remote views or belief of the possessor. ’ ’

And again at page 93 Judge Spear indorsing the principle of the ease of Dayton v. Marshall, 1 Rice Eq. 373, declares the rule to be “that where it is shown that the original seizure was a disseizin, no subsequent act or declaration of the claimant should be held to toll the statute which does not deprive the holder of the title of his right to prosecute his action to recover possession or suspend the same.”

The unreported case of Reily v. Whiteman, 69 Ohio St. 543, followed this case.

The decision below was erroneous and is therefore reversed and the cause is remanded for new trial.

Swing and Jones, E. H., JJ., concur.


author: SWING, J.

text:
    ACTIONS — CONTRACTS.
    [Hamilton (1st) Court of Appeals,
    June, 1914.]
    Swing, Jones and Jones, JJ.
    J. Willard Haley v. Grace King and Hazel Z. King, Admrs.
    1. Paper Writing in Form of Promissory Note Held to Be Contract Requiring Proof of Performánce.
    A writing binding the estate of the maker for a specified sum 'immediately after her death in payment for services rendered and to be rendered, is not a promissory note, but a contract under which it would be necessary for the person named therein to prove rendition of the services agreed' to be rendered.
    2. Defense of Adjudication not Denied by Allegation of Pendency of Cause in Supreme Court.
    The defense that a claim has. been adjudicated and all matters pending between said parties were included in said adjudication is not denied by an allegation of the pendency of an action in the Supreme Court to reverse said judgment; nor is a denial of every other matter not admitted a denial of the defense set up in the action so pending in the Supreme Court.

      Error.

      S. O. Bayless and Nelson & Hickenlooper, for plaintiff in error.

      H. E. Engelhardt and R. M. Ochiltree, for defendants in error.
   SWING, J.

This case is in this court on error to the judgment of the court of common pleas.

It was in that court that Haley brought an action on what he alleged was a promissory note, against the estate of Susan M. Zilar, deceased. The note was in the following form:

“Cincinnati, October 11, 1902.
“In consideration of valuable services rendered to me and to be rendered for me by J. W. Haley in the management of my property, and for his advice and assistance in preventing great losses to me, I agree and bind myself to pay to said Haley, his heirs or assigns ten thousand dollars, to be paid immediately after my death, and I direct my executors or administrators to pay same accordingly.
“(Signed) Susan M. Zilar.”

Haley assigned the note to his wife, with the provision that if it became due during his lifetime he should have a right to collect the same; and then his wife afterwards reassigned the note to him.

Several defenses were set up by the defendant — among others the giving of the note by Susan M. Zilar was denied; want of consideration was alleged; and the further defense that in an action pending between Susan M. Zilar and J. Willard Haley for an accounting, the question of the right arising under this paper was fully adjudicated and unreversed.

Plaintiff offered the note in evidence, together with evidence tending to show the signature was that of Susan M. Zilar, and the further fact that the note had been presented to the administratrices for allowance. And thereupon the plaintiff rested.

Defendant offered no testimony. Thereupon the court instructed the jury to bring in a verdict for the defendant.

In doing this, we think the court of common pleas did not err. In our judgment the alleged note is not a promissory note; it is a contract. This is rendered so by the provisions .in the note that the consideration is for services rendered and to be rendered. And it would be necessary, in order for the plaintiff to recover, to show the rendition of the services agreed to be rendered. The note, with the endorsements thereon, lead us to think that it is a thoroughly dishonest transaction. In addition, we think there is virtually no denial of the defense set up that it has been adjudicated and that all matters between said Haley and Mrs. Ziler are included in the former action pending between said parties. The fact that Haley sets out that proceedings were pending in the Supreme Court to reverse said judgment, is not a denial to the allegations of the answer; and the further allegation in the reply that plaintiff denies every other allegation not admitted, can not be held to be a denial of the defense set up in the answer, for the reason that the allegation in the reply that proceedings are pending in the Supreme Court to reverse said judgment, must be held to be the one that applies particularly to said defense.

We are thoroughly convinced that there is no merit in plaintiff’s action and for the reasons hereinbefore stated we think the judgment should be affirmed,

Jones and Jones, JJ., concur.


text:
    CORPORATIONS.
    [Hamilton (1st) Court of Appeals,
    April 11, 1913.]
    Swing, Jones and Jones, JJ.
    G. A. Ginter, Recvr. v. F. J. Blain.
    1. Subscriber to Stock of Corporation Entitled to Determining Voice as to State for Organization.
    A subscriber to the stock of a proposed corporation is entitled to a voice in the. determination of the state in which it is to be organized, and the fact that the land which it 'is proposed to acquire is in Kentucky raises no presumption that the company is to be a Kentucky corporation, notwithstanding the subscribers are resident of and the articles executed in Ohio.
    2. Variance Between Prospectus and Articles of Incorporation Sufficient to Release Subscriber to Stock.
    The incorporation of a company to build and operate a hotel and restaurant is such a variance from the prospectus, which stated the purpose to be to build and possibly furnish a hotel, as to relieve a subscriber to the' stock under the prospectus from liability to make payment therefor.
    Error.

      Ireton & Schoenle, for plaintiff in error.

      J. L. Kohl, for defendant in error.
   JONES, O. B., J.

This is an action on account claimed to be áue for an unpaid subscription to the stock of the Blue Grass Inn Company, a corporation under the laws of Kentucky. The defendant denied that he ever became such subscriber.

The only proof offered of such subscription is found in the prospectus with its accompanying subscription list which show that it was proposed to organize the Blue Grass Inn & Hotel Company to erect a hotel on certain described property located in Campbell county, Kentucky, and sets out how the capital stock shall be constituted. Upon this list of stock subscriptions appears the name of F. J. Blain as one of the subscribers under díate of May 29, 1906, the amount subscribed being $1,000. Articles of incorporation were executed by five persons, four of whom were among those whose names appeared on this stock subscription list, organizing a Kentucky corporation to be known as the Blue Grass Inn, and setting out that the “business to be conducted by said company is to construct and operate a hotel and restaurant.” The record shows that defendant did not in any way participate in its organization and he claims to have had no knowledge of the incorporation until the receipt of the notice demanding payment of the first installment of stock subscription, when he made prompt inquiry, and on learning from the president of the company what had been done he repudiated their action and declined to have anything to do with the enterprise, and the president apparently recognizing'his right to withdraw or rather to decline to go into the company, but without submitting the matter to the company or its board of directors, struck his name from the subscription list, and it appears no further calls were madie on him until after the receivership. But defendant does not rely on such release.

We do not believe the facts shown make defendant liable as a subscriber to the stock of the company as organized. His proposal according to the prospectors was to take $1,000 — in stock (cumulative preferred) at 90 cents on the dollar with an additional 20 per cent of the par value of this subscription in common stock as a bonus. In what state the corporation was to be organized had not been determined. The laws differ widely in the different states. The defendant was entitled to a voice in this matter. It can not be said that because the land was in Kentucky, the corporation must be necessarily organized in Kentucky. The articles were executed in Ohio, where most of the subscribers resided, and it might as well be claimed, therefore, that it was understood that it should be organized under the laws of Ohio.

The company described in the prospectus was for the purpose of erecting the hotel, possibly to build and furnish it. The company as organized was not only to construct but also to operate the hotel and a restaurant as well. This would be such a variance from the terms of the original proposal that it would require the consent of defendant either actual or implied to hold him. Woods Motor Vehicle Co. v. Brady, 181 N. Y. 145 [73 N. E. Rep. 674]; Greenbrier Industrial Exposition v. Rodes, 37 W. Va. 738 [17 S. E. Rep. 819]; Cook, Corporations Secs. 62 and 194.

Counsel for plaintiff in error criticise the distinction made by the court below in the charge between preferred sto'ck and cumulative preferred stock, and argue that the rules and regulations adopted by the shareholders rather than the articles of incorporation fix such provisions. ■ Section 564 of the Revised Statutes of Kentucky (which was introduced in evidence but is not contained in the bill of exceptions) undoubtedly does authorize the corporation by appropriate action to provide for cumulative preferred stock, but no such action by the directors or the stockholders appears in the record.

Other errors are also pointed out by counsel for plaintiff in error but, holding as we do that defendant was not a subscriber to the stock of the Blue Grass Inn Company as organized, it is not necessary to consider them, as they can be in no way prejudicial to plaintiff.

Judgment affirmed.

Swing and Jones, E. H., JJ., concur.


author: HOUCK, J.

text:
    CONTRACTS — CORPORATIONS.
    [Knox (5th) Court of Appeals,
    October 22, 1915.]
    Shields, Powell and Houck, JJ.

      Ed. Dever v. Reeves Engineering Co.
    Agreement by which Preferred Stockholders Remit Dividends and Common Stockholders Promise to Pay Assessments on Stock Held Mutual and of Good and Sufficient Consideration.
    An agreement by stockholders of all common and preferred stock of an Ohio corporation “in consideration of the mutual promises of each other and of the benefits to accrue to each,” the preferred agreeing “to excuse and remit” certain dividends, and the common “to pay * * * $40 per share upon the number of shares set beside our respective names,” does not fail for want of mutuality or lack of good and sufficient consideration to sustain and support it; such agreement is not in conflict with the statutes and may be enforced in the name of the corporation.
    [Syllabus approved by the court.]
    Error.

      L. C. Stillwell and C. L. Bermont, for plaintiff in error.

      Henry C. Devin and D. B. Grubb, for defendant in error.

      Motion to certify record overruled by the Supreme Court, December 11, 1915.

   HOUCK, J.

This cause is here on error to the judgment of the common pleas court of this county. The action below is based on a written agreement entered into between the stockholders of the Reeves Engineering Company, whereby they agree to pay certain amounts to the treasurer of said company, for the benefits to accrue- to them and said company, the amount claimed to be due from the defendant below being $640. The petition averred that:

“Plaintiff is a corporation organized under the laws of the state of Ohio, with an authorized capital stock of 600 shares of common stock of the par value of $100 each, and 400 shares of preferred stock of the value of $100 each; that on or about December 15, 1910, and at the dates and times hereinafter meutioned, said plaintiff had issued and outstanding of its said capital stock 576 shares of the said common stock and 263 shares of said preferred stock; that on or about said date, in order to provide said corporation with additional money, the stockholders entered into a written agreement between themselves, and with said corporation, for the payment of a voluntary assessment upon the shares of common stock held by each stockholder, and the following is a copy of said agreement, to-wit:
“We, the undersigned, being all of the common and preferred stockholders of the Reeves Engineering Co. of Mt. Yernon, Ohio, in consideration of the mutual promises of each other, and of the benefits to accrue to each of us and the Reeves Engineering Co., do hereby agree as follows:
“We, the preferred stockholders, hereby agree to excuse , and remit in full, receipting therefor, all dividends now accumulated or that shall accumulate prior to Jan. 1, 1911.
“We, the common stockholders, hereby agree to pay to the treasurer of the Reeves Engineering Company $40 per share upon the number of shares set beside our respective names.
“Payments to be made as follows: 25 per cent of said amount on or before Dec. 15, 1910; 25 per cent on or before Jan. 15, 1911; 25 per cent on or before Feb. 15, 1911, and the entire balance on or before March 15, 1911.”
“Plaintiff further says that said agreement was signed by the owner and holder of each and all of the issued and outstanding stock of said corporation; that at said time the said defendant, Ed. Dever, was the owner and holder of sixteen shares of the said issued common stock of said corporation, and that on or about said date said defendant, for the consideration therein set forth, did sign-his name to said agreement, and did set beside his said name the number sixteen to indicate the number of shares of said stock so owned and held b'y him.
“Plaintiff further says that said agreement was accepted by the board of directors of said company, and the subscription thereunder called for; that said defendant was duly notitied thereof, and requested to make payment to the treasurer of plaintiff of the several installments due thereunder, which said defendant refused and neglected to do, and has ever since refused and neglected to pay the said amount of $40 per share upon the number of shares set beside his name, or any part thereof.
“Plaintiff further says that it has duly performed all the obligations and conditions upon its part to be performed, and there is now due and owing to said plaintiff from said defendant, upon said defendant’s agreement hereinabove set forth, the sum of $640, with interest at 6 per cent per annum from the first day of August, 1911,” and prays judgment, etc.

The defendant filed an answer denying all the material allegations of the petition, and specifically averring that notwithstanding he signed said paper writing that it was without eonsid'eration moving either to him or the said the Reeves Engineering Company, and that said company did not own the claim upon which suit is brought.

A reply in the nature of a general denial was filed to the answer; the cause was tried to a jury, and a verdict returned for the full amount, with interest, and judgment rendered upon the verdict. The judgment is sought to be reversed for the following reasons:

First, that the statutes of Ohio do not authorize a recovery upon such an agreement as the on'e upon which the suit at bar is based.

Second, that the plaintiff below did not own the claim upon which suit was brought.

Third, the contract of agreement is not founded upon a good, valid, or sufficient consideration, and is without any consideration to support it.

From an examination of the statutes of Ohio and the record in this case we are fully satisfied that the alleged errors numbers one and two are not well taken, and should be overruled, and the same is hereby accordingly done.

The real question presented for the determination of the court appears to us to be, Is the paper writing sued upon a contract in substance and in fact, with a good and sufficient consideration to support it, or is there any consideration for it ? If this is answered in the affirmative then the judgment should stand; but if in the negative it must fall. Can it be claimed with any degree of assurance, after an examination of the contract, that the plain language contained therein does not state a consideration? It certainly does not fall for lack of mutuality, and as mutuality is essential to the validity of at least an executory contract the law certainly presumes an intent to create mutual obligation except in cases where the expressed agreement will not admit of that interpretation. From the nature of the agreement what is the reciprocity between the parties? The plaintiff in error was the ownr of sixteen shares of the common stock of the Reeves Engineering Company, and there were many others who owned stock, and also a number who owned preferred stock. The company needed more money to conduct its business, and the preferred stockholders said in the agreement, “We hereby agree to ekcuse and remit in full, receipting therefor, all dividends now accumulated or that shall accumulate prior to January 1, 1911.” The common stockholders said in the agreement, “We hereby agree to pay to the treasurer of the Reeves Engineering Company $40 per share upon the number of shares set beside our respective names.” This was a promise for a promise, and when carried into effect, which was done by all of the stockholders except the plaintiff in error and two others, enhanced the value and increased the assets of the company, and thereby inured to the benefit of all the stockholders, including the plaintiff in error and the company, which was fully intended by the language of the agreement, namely: “We, the undersigned', bein| all of the common and preferred stockholders of the Reeves Engineering Company, of Mt. Vernon, Ohio, in consideration of the mutual promises of each other, and of the benefits to. accrue to each of us and the Reeves Engineering Company, do * * * .”

What were the benefits to be derived? The payment on the contract would and did increase the value and assets of the company. The co-stockholders with plaintiff in error com tributed tbeir part, as provided for and agreed to by them in ' said written agreement, which was all they had agreed to do or could do, and which thereby enhanced and enlarged the assets of the-company, which inured to the benefit of the plaintiff in error as well as the company, and which was the ultimate object of the contract. From an examination of the language of the instrument it is apparent that the parties thereto intended to make a contract — a binding obligation — and every line precludes the idea that it was not intended to be binding upon the parties thereto and of full force and effect in law.

We think the doctrine laid down in the case of Sterling Wrench Co. v. Amstutz, 50 Ohio St. 484 [34 N. E. Rep. 794], first paragraph of the syllabus, is applicable to this case:

“An agreement entered into by solvent shareholders of an embarrassed corporation, that they will severally contribute to raise a fund to pay the corporate liabilities, creates a valid obligation; and, if the share to be contributed by each is not expressly fixed by the terms of the agreement, each should contribute in the 'proportion that the number of shares of stock owned by him bears to the shares held by all the contributors. ’ ’

The record discloses that all of the stockholders except the plaintiff in error and two or three others have paid the several amounts agreed by them to be paid under said contract, and that full performance by all of the contracting parties of their obligations under the contract have been met by them. In the face of this fact and the plain language of the contract, which to our mind is founded upon a good and valuable consideration, is it proper and right under the facts and the law that the plaintiff in error should not be compelled to comply with his agreement and the terms of the contract as entered into by him? We think not. A majority of the court is of the opinion that the judgment below is right and should be affirmed.

Shields, J., concurs.

Powell, J., dissents.


author: JONES, E. H., J.

text:
    BANKS AND BANKING.
    [Hamilton (1st) Court of Appeals,
    October Term, 1914.]
    Swing, Jones and Jones, JJ.
    (Swing, J., not sitting.)

      Second Nat. Bank v. Amy R. Campbell.
    Bank Negligent in Executing Draft Raised to Larger Amount Without Exciting Suspicion.
    Whether a draft which had been “raised” and was accepted for the larger amount, had been so negligently drawn as to make the issuing bank liable for the full amount by reason of the fact that the alteration was possible without exciting the suspicion of a reasonably careful man, is a question for the jury, and an unequivocal finding as to such negligence will not be disturbed by a reviewing court.

      Charles B. Wilby, for plaintiff in error.

      Charles W. Baker, for defendant in error.

      Motion to certify record overruled, Second National Bank v. Campbell, 60 Bull 40.

   JONES, E. H., J.

This action was originally brought by Amy R. Campbell against the Second National Bank of Vincennes, praying for judgment for $360 upon a draft drawn by said, bank, which she cashed for th.e payee.

The draft when tendered to her was in the sum of $360. She accepted it in payment of a tuition fee of $100, and paid the difference to the prospective pupil of her business college in cash. She recovered judgment below against the bank for $260' with interest, the evidence showing that she really never parted with the remaining consideration, the matriculation in the college being only a ruse by which Miss Campbell was induced to honor the ’draft.

The judgment below in favor of the defendant in error rests upon the allegations of the second cause of action of her amended petition, which are as follows:

“Plaintiff says that defendant is a corporation under the laws of United States, and is and was doing banking business at Vincennes, Indiana.
“Plaintiff says that on the 27th day of September, 1910, at Vincennes, Indiana, the defendant drew a draft on the Port Dearborn National Bank of Chicago, Illinois, and delivered, it to a man purporting to be one E. J. Andrews. 'That said draft was on the usual forms used by the defendant in drawing such drafts; was made payable to the order of one M. J. Andrews, and this plaintiff is advised that the defendant claims that the said original draft was drawn for $3.00 only.
“Plaintiff says, however, that the said draft was so negligently and unskillfully drawn and made out as that it permitted its alteration without detection, and whatever -was the amount of the original draft it was so carelessly and negligently drawn and written in and made out, and without the usual safe-guards ordinarily used in connection with the drawing of such drafts, that the said draft was susceptible of being altered without detection, and it was so. altered by the said M. J. Andrews, or some one for him, so that the said draft came to be in the following form and shape:
“The Second National Bank of Vincennes,
“Vincennes, Indiana, Sep. 27, 1910, No. 25296.
“Pay to the order of M. J. Andrews............$360.00 three hundred sixty & No 100 ..............dollars.
To Ft. Dearborn National Bank,
Chicago, 111. J. T. Boyd, Cashier.
Not over five hundred dollars.
“Endorsed- M. J. Andrews,
“A. R. Campbell,
“Paid through Chicago Clearing House,
“Oct. 1, 1910.
“Mail.
“First National Bank,
“Pay First National Bank, Chicago, 111.
or order,
“Prior endorsements guaranteed,
“Fourth National Bank, Cincinnati, O.
“Charles Bartless, Cashier.
“Plaintiff says that, believing said draft to be genuine and for three hundred and sixty ($360) dollars and the said M. J. Andrews having endorsed the same, as did this plaintiff, she deposited it for collection in the bhnk in Cincinnati, where she kept her account; but the said draft was refused payment by the Second National Bank of Vincennes, which said bank now claims that it never issued said draft for the said sum of three hundred and sixty ($360) dollars.
“Plaintiff says that, by reason of the carelessness and negligence of the defendant company, the drawer of said diraft, in drawing a draft that was so carelessly and negligently drawn that it could be altered and changed without detection, she was deceived into taking said draft and giving its equivalent as aforesaid, all to her damage in the sum of three hundred and sixty ($360) dollars, and without fault upon her part.”

These allegations were denied in the amended answer in which it is averred that “the draft was carefully drawn and protected by the use of the Todd protectograph, a device in use by most banks for the prevention of alteration of checks, which is the best device for that purpose known to bankers, and is the safeguard most commonly used in connection with the drawing of such drafts, and that said draft was altered without fault on its part.”

Thus, the issue of the care or want of care by the bank in drawing the draft, was made by the pleadings in the case. The jury had that one question before it for determination; and in addition to their general verdict the jurors were required to answer certain interrogatories propounded by the defendant below. The interrogatories and answers are as follows:

“1. Was the bank negligent in drawing and issuing that diraft?
“Answer: Yes. L. H. Bates, Foreman.
“2. If your foregoing answer shall be ‘yes’ then state in what respect the bank was negligent.
“Answer: By not having used the necessary precaution, to-wit: the evidence produced in this case showing the draft marked ‘Exhibit A’ in its present appearance to us does not show that same was stamped more than once by the proteetograph device and that the draft does show it was stamped at least once, ‘Not over five hundred dollars’ by the above named device, upon this evidence and testimony given that this device was used by the defendant in issuing the draft they in our opinion were guilty of negligently preparing the draft in question.
“L. H. Bates, Foreman.”

It is claimed however, that this finding of the jury is not supported by the evidence, and in support of this contention this court has been provided with two magnifying glasses and a Todd protectograph in an effort to show that there has been a change in the protectograph impression on the draft since it was issued by the bank, and that the jury was mistaken in finding to the contrary. These aids in the determination of the issue, together with the draft, were in possession of the jury during its deliberations. Their clear and unequivocal answer to the second interrogatory amply supports the allegation of the amended petition as quoted above, and leaves no doubt as to the position of the jury upon this simple yet important question of fact. We are not aware of any law or rule which would authorize this or any other court to interfere with this finding of fact by the jury, unless it was manifestly against the weight of the evidence. A great many witu esses were called to testify upon the point upon which the jury passed, but after all, the principal item of evidence is the draft itself. While its appearance satisfied some of the witnesses that the first proteetograph stamping had been changed, there was a conflict, even among the witnesses upon this point. All possible assistance was rendered the jury in determining this issue. From its verdict there is no appeal. It would be a palpable usurpation of the province of the jury for a court to interfere.

The questions of law involved ™ this controversy have apparently not often arisen, especially in our state. The judgment against the bank, assuming the facts to be as found by the jury, was warranted by the law as well stated in 2 Daniel, Negi Instru. (6 ed.) Sec. 1405:

“When the drawer of the ball or maker of note has himself, by careless execution of the instrument, left room for any alteration to be made, either by insertion or erasure, without defacing it, or exciting the suspicions of' a careful man, he will be liable upon it to any bona fide holder without notice when the opportunity which he has afforded has been embraced, and the instrument filled up with a larger amount or different terms than those which it bore at the time he signed it. The true principle applicable to such cases is that the party who puts his paper in circulation, invites the public to receive it of any one having it in possession with apparent title, and.he is estopped to urge an actual defect in that which, through his act, ostensibly has none. It is the duty of the maker of the note to guard not only himself but the public, against frauds and alterations by refusing to sign negotiable paper made on such a form as to admit of fraudulent practices upon them with ease and without ready detection. The inspection of the paper itself furnishes the only criterion by which a stranger to whom it is offered can test its character, and when the inspection reveals nothing to arouse the suspicions of a prudent man, he will not be permitted to suffer when there has been an actual alteration.”

See also: Johnston Harvester Co. v. McLean, 57 Wis. 258 [15 N. W. Rep. 177; 46 Am. Rep. 39]; Garrard v. Hadden, 67 Pa. St. 82 [5 Am Rep. 412]; Zimmerman v. Rote, 75 Pa. St. 188; Brown v. Reed, 79 Pa. St. 370 [21 Am. Rep. 75],

The fifth paragraph in the syllabus of the last case cited is authority for the claim that the issue that we have here is one for the jury. It reads as follows:

‘ ‘ The paper in this ease was part of a contract so skillfully arranged that if the portion on the right end were cut off there would be left a negotiable note. Held-. That whether there was negligence in the maker in executing such paper, was for the jury.”

We find no error in the record to the prejudice of plaintiff in error, and the judgment will therefore be affirmed.

Jones, O. B., J., concurs.


author: SAYRE, J.

text:
    BILLS, NOTES AND CHECKS.
    [Scioto (4th) Court of Appeals,
    December 18, 1914.]
    Jones, Walters and Sayre, JJ.
    *Elizabeth Evans, Exrx. v. Kate Comins et al.
    1. Promise by Indorser to Collect Notes is Waiver of Notice of Dishonor.
    An indorser of a negotiable instrument who, before the time for presentment, agrees with the holder that he will collect the principal sum evidenced by said instrument aDd the interest due thereon, thereby waives notice of dishonor.
    2. Holders Relieved from Making Demand and Giving Notice of Dishonor.
    An indorser of a negotiable instrument who, for eight or ten years has sold and delivered such instruments to the holders and has always collected the principal and interest due thereon, can not take advantage of the failure of such holders to make demand and give notice of dishonor to him, after such course of conduct, although he did not expressly agree to undertake the collection of the note in controversy.
    Error.
    August 3, 191], Hester Ann Copeland and Arthur J. Copeland executed and delivered to Nelson W. Evans their five promissory notes, for $500 each, payable to him one year after date. Before the end of August, 1911, Nelson W. Evans, for a full and valuable consideration, sold and delivered two of the notes to Alice and Kate Comins, and signed his name on the back of each note. The notes contained no waiver of protest. Presentment for payment was never made or attempted, and notice of dishonor was never given to the indorser, Nelson W. Evans, who died May 27, 1913. Kate and Alice Comins claim that notice of dishonor was waived by the indorser, as appears by the testimony of their mother, which was undisputed and is as follows:
    “Q. State your name, age, and residence? A. Ann Com-ins ; aged 85; No. 1148 Gallia street, Portsmouth, Ohio.
    “Q. Were you acquainted with Captain N. W. Evans during his lifetime? A. Yes, I have known him for 35 years; probably longer.
    ‘ ‘ Q. How close did you live to him? A. ■ Next door but one for about the past eight years. We have always been friendly.
    ‘ ‘ Q. Hid he come to your house; and if so, how frequently during that time? A. He came nearly every week or so.
    “Q. What relation are you to Alice and Kate Corains? A. Their mother.
    “Q. Did Captain Evans and your two daughters, Alice and Kate, have any business transactions together? A. Yes; we used to think that whatever Mr. Evans did was all right.
    “Q. What were these business transactions? A. He would bring notes to them and sell them to them, and attend to collecting the interest and the notes.
    “Q. Did the girls look after any of these notes that he sold them, or did Captain Evans? A. They let him have the care of them, always.
    “Q. Do you know whether or not that he let them have a couple of notes given by Hester Ann Copeland and Arthur J. Copeland, dated August 3, 1911, for $500 each? A. I think I heard him talking about these notes, and he told them that they were on a farm and that they were as good as gold.
    “Q. Was there anything said about who would look after these notes? A. He said he would look after them.

      “Q. I ’ll ask you whether or not he did bring any interest here on the notes? A. I think he did.
    "Q. How long were these business transactions about the notes between Captain Evans and the girls? How long back was he indorsing these notes, collecting the interest and looking after them for the girls? A. As much as eight or ten years, probably more than that.
    ' ‘ Q. How near to the time of his death was he over here, talking about the Copeland notes? A. Not longer than three or four weeks before his death.
    ‘•'Q. What did he say the last time he was over here, talking about the Copeland notes? A. He said they were on a farm, and that they were as good as gold, and I asked him who this Copeland was. He said, ‘He is a farmer, and as good as gold,’ and he says, ‘I’ll attend to them and look after the notes.’
    “Q. Did the girls.ever look after any notes that Captain Evans ever indorsed to them? A. He did all the collecting.
    “Q. Where would he give them the money? A. Here at the house, and some he sent by check through the mail.
    “Q. Did the people that these notes are on, did the girls go and see them? A. 1 don’t think they did. We always had confidence, we never questioned. Captain Evans looked after it.
    “Q. You have said that they were dealing in notes with him for the past eight or ten years. I’ll ask you that if during that entire time they held notes that he had sold them? A. Yes.
    “Q. Is it or is it not a fact that he had practically entire charge of their money in this way ? A. Nearly all of it. ’ ’
    The court below held that notice of dishonor was waived.
    E. G. Millar and Jos. T. Micklethwaite, for plaintiff in error.

      Blair & Kimball, for defendants in error.
   SAYRE, J.

Section 8214 provides that notice of dishonor may be waived expressly or by implication.

Waiver of demand and notice must be clearly shown. Second Nat. Bank v. McGuire, 33 Ohio St. 295 [31 Am. Rep. 539].

The necessity to give notice of dishonor is dispensed with by such conduct on the part of the indorser toward the holder of negotiable paper as is calculated to put a person of reasonable prudence off his guard or to induce him to omit to give such notice. Boyd v. Bank, 32 Ohio St. 526 [30 Am. Rep. 624].

It appears from the testimony that Nelson W. Evans, for several years, had been selling notes to Kate and Alice Comins and attending to the collection of the principal and interest, and that he said he would look after these particular notes. However, it does not clearly appear, when he said he would look after the Copeland notes, whether it was before maturity or afterward, as the last conversation in which he said he would look after them was some time after the notes were due. It is not clear that Nelson W. Evans, before the time when demand and notice should have been given, agreed to look after the collection of these particular notes-; but from the long course of similar transactions, in negotiating notes to Kate and Alice Comins and collecting the principal and interest, they clearly had a right to expect that he would undertake the collection of the Copeland notes. By such conduct and without notice to the contrary, he did undertake to “look after the notes.” His promise to collect the notes is clearly implied from the situation of the parties, as shown by the evidence of Ann Comins. He thereby took upon himself the duty of collecting the notes, which included the duty to take the necessary steps required by law to make an indorser liable. He thereby relieved the holders from the duty to make demand and give notice of dishonor. It became his dutjr to do wliat the law required Kate and Alice Comins to do, that is, to make demand and give notice of dishonor. If he had made demand, as he was bound to do under bis arrangement with, them, he would have had notice of dishonor. If he did not receive such notice it was because he did not do his duty. So that neither he, nor his estate, could take advantage of his failure to do his duty. By taking upon himself the duty to collect the notes he clearly waived notice of dishonor. Torbert v. Montague, 87 Pac. Rep. 1145 (Cal.); Bryant v. Wilcox, 49 Cal. 47.

The judgment' will be affirmed.

Jones and Watters, JJ., concur.


text:
    STREET RAILWAYS.
    [Hamilton (1st) Court of Appeals,
    February 5, 1915.]
    Swing, Jones and Jones, JJ.
    Cincinnati Trac. Co. v. Mary Thompson.
    Pedestrian at a Street Crossing Negligently Stepping on a Greasy Rail, Causing Fail and Injuries, Denied Recovery.
    A young lady, familiar with a street crossing and with the fact that the rails laid on a curve were sometimes greased, attempting to cross at a time when the street was clear and the grease could easily have been discovered, failing to look where she was stepping, and as a consequence slips on the greasy rail, falling and being injured, is not entitled to recover therefor. Cincinnati Trac. Co. v. Cramer, 31 O. C. C. 576 (12 N- S. 315), distinguished.
    Error.

      Miller Outca.lt, for plaintiff in error.

      Spangenberg & Spangcnberg and Thomas L. Michie, for defendant in error.
   SWING, J.

This cause is in this court on error to the judgment of the superior court of Cincinnati, in which court said Mary Thompson recovered a judgment against the traction company for the sum of $2,034 on December 4, 1913, for personal injuries caused by slipping and falling on the rails of the traction company at the northwest corner ot‘ Fifth street and Central avenue, in. .the city of Cincinnati.

The allegations of negligence charged in the petition are as follows:

“Plaintiff says that defendant wrongfully and negligently placed and caused to be placed, and allowed to remain, a large and unnecessary quantity of grease, oil and pitch upon its said south rail at the said street intersection, whereby it became and was then and there dangerous to the public using and crossing the said rail in this, to-wit: that the said rail was made slippery by the said large and unnecessary accumulation of grease, oil and pitch which the defendant had placed and allowed to remain upon its said south rail at the east crossing of the said Central avenue over the said Fifth avenue, whereby the plaintiff as she stepped upon the south rail then and there slipped and was caused to fall.”

There is no conflict in the testimony, and there was no evidence other than plaintiff’s evidence. >

The evidence shows that the plaintiff below, in company with a friend, Miss Eleanor, Gunlach, started across the street, as alleged in the petition, and plaintiff below was familiar with the crossing, having frequently crossed the same; that at the time of the crossing there were no vehicles or cars on the street, and the street was perfectly clear. She was a woman of good sight, and in full possession of her mental faculties. She had frequently seen these railway tracks in the street, and was familiar with this curve and rail. She knew also that it was customary for the traction company to apply grease to the tracks at this curve. She testified:

“Q. You had noticed it (grease in the tracks) before? A. Many a time. Anybody could notice that grease.
“Q. You knew grease was slippery? A. Certainly.
“Q. You knew if you stepped upon grease you were likely to fall; that is true? A. Yes, sir.”

She testified that the grease was easily discernible and that it was very black and different in color from the rest of the street at the point where it was placed. She was asked this question:

“Q. The question is: why didn’t you look, on this occasion, when you came to that curve, that switch? A. I was crossing over on the crossing. I seen the road was clear. There was nothing coming, at all. I was right on that flagging, and there was nothing in front of me, and of course I put my foot right down there, and it went partly on the tracks and the other part on the flagging, and the grease slipped me; and that is how I fell.
“Q. You say that you didn’t look? A. Not at that particular point.
“Q. So you knew it was likely there might be grease in the curve that morning? A. Yes, sir.”

Then again:

“A. If I knew it was there I could see it; knowing and looking I could not miss it.”
# & # # S&
“Q. If you had been looking to see, there would have been no difficulty in your stepping over it? A. No 'sir, there would not be if I had looked to see.”

The witness Eleanor Gunlach testified:

“A. We were not paying no attention just at the time on the track.”

She also testified that the grease was so black that it was different in color from the rest of the street. She further testified:

‘Q. If it was on the street, if you looked you would have seen it? A. Yes, sir.” -

There was no evidence which tended to show any negligence on the part of the traction company in greasing tracks at this point, unless it be found in the statement that there was too large an amount of grease placed on the track at this particular point. The witness testified that there was a quart or more, but whether this amount was in excess of what should have been placed there is not shown by the evidence. But whether it be so or not, it is not shown that the excessive amount of grease placed upon the track was the cause of the injury.

The traction company at the close of the evidence moved the court to direct a verdict for the defendant company, which motion the court overruled, and afterwards entered judgment on the verdict.

The facts being undisputed, it became a question of law for the court, provided these facts failed to show any negligence on the part of the traction company, or showed that the injury was caused by the negligence of the plaintiff as shown by her own testimony. W.e are of the opinion that the injury was caused by the negligence of the plaintiff herself in not using the ordinary care and prudence that persons are accustomed to use when crossing a street. It is clear that if she had looked she could have seen this grease upon the track, and could easily have avoided it. But she knew it was likely to be there, and she knew that if it was there and she stepped on it she was liable to slip. Knowing these facts, she paid no attention to it, and deliberately stepped upon the rail and received the injury. From these undisputed facts it seems clear that the plaintiff in error was not entitled to recover.

We have been referred to the case of Cincinnati Trac. Co. v. Cramer, 31 O. C. C. 576 (12 N. S. 315), as a case directly in point, and controlling upon this court in support of the contention of the plaintiff below in this case. The case is somewhat similar, and the syllabus as well as the opinion of the court would seem to bear out the contention of the plaintiff below in being decisive of the question raised here, as that case was decided by this court. But the facts in that case as shown by the record, were different from the facts here, and the decision should go no further than its application to the facts of the case. In that case the traction company had placed, a large quantity of grease outside of its tracks on the crossing, and the dust and dirt .had covered that grease so as to obscure it;s presence and it was upon this that the plaintiff in that case steppedj and not upon the track of the company. Whereas in' this case the plaintiff’s allegation was that the grease was placed upon the track of the company, and that she stepped upon the grease on the tracks of the company. The facts being different, we do not think that we are bound by the decision in that case.

The judgment will be reversed, and judgment entered in this court for plaintiff in error.

Jones and Jones, JJ., concur,


text:
    CRIMINAL LAW.
    [Darke (2nd) Court of Appeals,
    January, 1915.]
    Swing, Jones and Jones, JJ.
    J. E. Stephenson v. State of Ohio.
    Incompetency of Accused Defending Without Counsel Being Shown, ■ Held no Trial.
    Where a defendant in a criminal case states that he does not desire courisel, and attempts to conduct the defense himself, and it becomes evident that he is mentally incapable of so doing, or understanding the nature of the defense, it becomes the duty of the court to stop the trial and appoint counsel to defend; and where this is not done, and the trial results in the conviction and sentence of the defendant, a reviewing court will reverse the judgment on the ground that virtually there was no trial.
    Error.

      D. E. Mote and Robert T. Mattingly, for plaintiff in error.

      L. E. Kerlin and J. H. Porter, Pros. Attys., for defendant in error.
   SWING, J.

This case is here on error to the judgment oif the court of common pleas of Darke county, and by consent of parties it was heard by the court of appeals of the first district of Ohio. The case was submitted and argued on briefs, but the court after considering the briefs and the record requested oral argument, which was had. t

On September 16, 1914, plaintiff in error was convicted upon a charge of embezzlement, and was sentenced to the penitentiary for a term of two years.

This case is sni generis. It was tried by the prosecuting attorney of Darke county representing the state, and the defendant representing himself. Before the trial defendant asked the court to appoint counsel to defend him, and the court thereupon selected one Theodore Shockney, a member of the bar of said county. When the case came on for trial said attorney refused to act as counsel, and the record shows that the defendant not asking or desiring counsel, the case proceeded to trial, the defendant representing himself.

We think that the record- shows that there was really no trial, so far as the defendant was concerned. It is quite evident that at the time of the trial the defendant was mentally incapable of comprehending the .nature of his defense, and we think this fact must have been apparent to the court at the time. While defendant seems to have thought be was making a defense still it was really no defense, and, realizing this fact, we think the judge should have stopped the trial of the case and appointed some counsel j;o defend, so that the trial might have been properly carried on. We think that the law contemplates that a defendant should have a fair trial. The record in this case virtually shows that there was no trial, so far as the defense was concerned. Upon this broad ground we think the judgment should be reversed and a new trial granted.

Jones, E. H., J., concurs.

Jones, O. B., J., dissents.


text:
    INSURANCE.
    [Hamilton (1st) Court of Appeals,
    June 30, 1914.]
    Swing, Jones and Jones, JJ.
    Metropolitan Life Ins. Co. v. Oberst Burbank, Admr.
    Facility of Payment Methods Upheld as to Industrial Policies.
    Owing to the great volume of insurance done by industrial insurance companies and the necessity for prompt settlement in order to efficiently carry out the purpose of insurance of that class, and also for the protection of the companies against claims which might develop during the course of the legal administration of the estates involved, facility of payment provisions contained in such policies should be regarded with favor; hence, where it appears that payment was made strictly within the terms of the policy and in good faith on the part of the company and .the proceeds were applied to payment of the funeral expenses and an unpaid board bill of the decedent, an action cannot be maintained against the insurance company for the proceeds of the policy by the administrator of the insured.

      Error.

      Robertson & Buchwalter and Theodore C. Jung, for plaintiff in- error-

      William R. Collins, for defendant in error.
   JONES, O. B., J.

The action below was brought by Oberst Burbank, as administrator of James A. Mulvey, deceased, to recover $210 with interest and for an accounting, under a policy No. 42,660,077 issued by the Metropolitan Life Insurance Company upon the life of James Mulvey, November 8, 1909, then twenty years of age, on the payment of weekly premiums of ten cents.

The language of the policy contained the following facility of payment clause:

' ‘ The company may pay the amount due under this policy to either the beneficiary named below, or to the executor or administrator, husband or wife, or any relative by blood or connection by marriage of the insured, or to any other person appearing to said company to be equitably entitled to the same by reason of having incurred .expense on behalf of the insured, or for his or her burial; and the production of a receipt signed by either of said persons shall be conclusive evidence that all claims under this policy have been satisfied.”

And for the purpose of naming the beneficiary and the relationship or situation he bore to the insured it contained the following language:

“Name of beneficiary and relationship to the insured, Geo. Loyd — Guardian. ’ ’

The Metropolitan Life Insurance Company, as defendant, admitted the making of the policy and the death of the insured, and pleaded the payment of the entire amount due 'to George Loyd as the beneficiary named in the policy, and to one Mary E. Snider, who had united with said George Loyd in surrendering the policy of insurance and all the receipt books, and who claimed that the policy of insurance had been given to her by the insured as security for the payment of a board bill due and owing from him to said Mary Snider. It further stated that said' George Loyd furnished proof that he was the beneficiary named in said policy of insurance, and that he and his wife had raised and brought up the said James A. Mulvey to the age of fourteen years and provided for his necessary wants. And it further stated that said George Loyd furnished proof to said company that he had incurred expense for the burial of said insured, and that the company had issued its check, which was duly paid, for the entire proceeds of said policy of insurance amounting to $210.40 to the joint order of George Loyd and Mary E. Snider, and that said check was paid to said parties.

Upon trial it developed that the insurance company had made payment, in accordance with the allegations of its answer, before any claim had been made upon it by plaintiff or any other claimant under said policy.

On submission to the jury a verdict was rendered in behalf of the plaintiff for $100.10, upon which a judgment was after-wards entered. Error is prosecuted in this court for the purpose of setting aside such judgment.

From a careful examination of the record it appears that after the death of the insured proof of claim was promptly filed with the company by George Loyd as the beneficiary named in the policy, and that Mary E. Snider, who has possession of the insurance policy and receipts, also claimed some interest therein on account of money due her from the deceased. Upon investigation by the insurance company the entire amount due under the policy was paid under a check drawn by said company in favor of George Loyd and Mary E. Snider. Out of this eheck the entire funeral expenses were paid to the undertaker, and the .balance of the money was divided in a manner satisfactory to the parties between said George Loyd and Mary E. Snider.

Defendant in error concedes that if George Lloyd had been actually the legal guardian of James A. Mulvey, plaintiff could not maintain the suit. We do not understand that the statement in the policy showing “Name of beneficiary and the relationship to the insured” as “Geo. Loyd — Guardian” should be taken to mean that George Loyd was then the legal guardian of the insured, but rather that the relationship which he bore to the insured was somewhat similar to that of a guardian, and the policy gave that as the relationship of the parties.

Industrial insurance companies because of the great volume of business done by them, evidenced in this case by the high number of the policy in question, have usually by the form of their policies provided for payments thereunder in a manner that will promote prompt settlement to carry out efficiently the purpose of such insurance and at the same time to protect the company against other claims which might develop upon a legal administration of an estate. The amounts involved are comparatively small and the benefits to be derived largely depend upon a prompt payment, as the fund is usually necessary to provide for burial and other expenses incurred upon the emergency of death.

Questions arising under payments made under the facility of payment clause of insurance policies of a similar character have been frequently brought before the courts, but because of the small amount involved they are usually found in the reports of the lower courts.

In Thomas v. Insurance Co. 158 Ind. 461 [63 N. E. Rep. 795], the law is thus stated:

“In Insurance Co. v. Schaffer, 50 N. J. Law 72 [11 Atl. Rep. 154], it was said: ‘The purpose and object of this kind of insurance seemed to require the payment to be made in that way, and it should, in good policy, be upheld. Unlike the ordinary life insurance, small sums are provided by these industrial policies to be paid at once on proof of death and surrender of policy. *** The terms and manner of insurance contemplate speedy payment to the family of the assured, immediately after his death, to provide a burial fund, or to meet the expenses which, in such an emergency, must be incurred. ’ Before actual payment by the company to some of the persons named in article second, an action might, perhaps, be maintained by the executor, administrator, or beneficiary, for the amount named in the policy; but when such payment has actually been made, by the express terms of the policy it operates as a complete discharge of the company from further liability. ’ ’

See also: Thompson v. Insurance Co. 119 App. Div. 666 [104 N. Y. Supp. 257; Thomas v. Insurance Co., 148 Pa. St. 594 [24 Atl. Rep. 82]; Wilkinson v. Insurance Co. 63 Mo. App. 404.

Parties when not prohibited by law from so doing are at liberty to' make their own contract, and within limits to provide what shall be evidence of certain facts. In this case the payment made by the company seems to have been directly within the terms of the policy. It was made to the beneficiary named in the policy upon the production of the policy and receipts for premiums paid thereunder, by him in conjunction with Mrs. Snider, who had a small claim for money advanced. The fact that the local agent of the company at the time of this payment insisted upon seeing that out of the amount so paid the undertaker’s bill and the funeral expenses should be paid, and the fact that for convenience the entire check was endorsed over to the undertaker and that he gave checks for the difference, or how that difference was divided between Mr. Loyd and Mrs. Snider, or that the undertaker appeared to have made a certain discount upon the funeral bill in favor of the beneficiary, can make no difference as to the validity of the payment, which was made in strict accordance with the terms of the policy.

There is nothing in the record to show any want of good faith on the p:ph of the insurance company nor that its action in making the payment as it did under the policy was violative of the rights of any claims that were brought to its knowledge. The motion of the defendant to arrest the cause from the jury and direct for the defendant should have been granted.

The judgment is therefore reversed and judgment entered here for plaintiff in error.

Swing and Jones, E. H., JJ., concur.


author: SPENCE, J.

text:
    CORPORATIONS — LIMITATIONS.
    [Ashland (5th) Court of Appeals,
    November, 1915.]
    Shields, Powell and Spence, JJ.
    (Spence, J., of the 7th district, sitting in place of Judge Houck.)
    Marblehead Bank Co. v. S. A. Raridon.
    1. Recovery Limited to Profits Actually Made by Promoter of Corporation.
    In an action by a corporation to recover the secret profits of its promoter, the recovery is limited to the profits actually made by him in dealing with the corporations or in transactions for the corporation.
    2. Limitations for Fraud not Applicable to Action for Recovery of Secret profits by Promoter.
    In .an action hy a corporation to recover secret profits from its promoter, the promoter stands in a fiduciary relation to the corporation, and the action is one for a breach of duty, not for fraud, and does not come within the saving clause of the statute of limitations as an action for relief on the ground of fraud.
    [Syllabus by the Court.)
    Error.

      Mykrantz & Patterson, for plaintiff in error.

      C. H. Workman, for defendant in error.
   SPENCE, J.

It is difficult to tell what theory of the case was in the mind of the pleader when the petition was drawn, but stripped of much of its useless verbiage it seems'to set forth the circumstances leading up to the incorporation of the Marblehead Bank Company, and certain transactions which took place after the incorporation of the company.

The amended petition avers that the defendant, S. A. Raridon, was the promoter of the bank company and had as his associate one W. C. Pollock; that they induced certain persons to become stockholders in the bank representing to them that it would do a prosperous business in the village of Marble-head; that the banking company was incorporated under the laws of the state of Ohio, on March 14, 1907, and that on May 11, 1907, the defendant, Raridon, Louis St. Marie and others were elected directors, and that the stockholders or directors elected a cashier for said bank. Then the amended petition contains this averment:

“And that afterwards on May 11, 1907, the stockholders who had subscribed for stock in said company, met and organized the same by electing directors and that said defendant was present at said meeting and falsely and fraudulently represented to the stockholders and directors of plaintiff that he had purchased for the company bank fixtures including four chairs, and directors’ table, one side desk, one double desk, one single desk and table, check shelves, electric fixtures, vault doors and safe, and that said fixtures were of the value of $2,982.32— that all of the stockholders and directors of said company, aside from the defendant and the said Pollock,. relied upon the representations of the defendant, in the entire organization, promotion and management of the bank at its inception.”

The amended petition further avers the defendant while in charge and control of said bank caused certain certificates of stock of the cash value of $1,000 to be issued to himself and "W. C. Pollock, and that they afterwards sold and transferred said stock to other parties, and that.while defendant was in charge and control of the bank he made out a “deposit slip,” and caused the cashier of the bank to give him credit on a checking account for $1,988.32, which money was later checked out of the bank by defendant, and further avers that it had no knowledge of the fact that defendant had taken a credit deposit subject to cheeking of $1,988.32, for expenses, furniture and fixtures until the year 1910, and had no knowledge as to what amount had been paid by defendant for furniture and fixtures or- the real value of the same , as furnished by defendant until the year 1910, and avers that the bank furniture and fixtures were not worth more than $1,000; that between May 10, 1907 and July 16, 1908, the defendant drew by check from the bank the amount of $1,988.32, at which date he closed his account with the bank and asks a judgment for $1,966,32 and interest.

The petition does not aver any collusion between the defendant Raridon and the other directors of the bank, but alleges that Raridon was in charge of the bank for some time after its organization. If these allegations are true then the directors of this bank were guilty of gross negligence.

To this petition the defendant filed a demurrer, first, because the petition does not state facts sufficient to constitute a cause of action against the defendant; and second, that the cause of action is barred by the statute of limitations or the action was not brought within the time limited for the commencement of such action.

The court of common pleas sustained' the second ground of the demurrer and the ease is here on error to the ruling of that court.

It was the evident purpose of the pleader to set forth a cause of action for the recovery of the difference between the actual cost or price paid by defendant for the furniture and fixtures furnished by him to the bank and the amount which he received from the bank for them.

The rule is well settled as stated in 1 Clark & Marshall, Priv. Corp.:

“That the relation of promoters to the proposed corporation when formed, is a fiduciary relation, or a relation of trust and confidence and for this reason it is well settled that they will not be permitted to take advantage of their position in order to make a secret profit out of their transactions on behalf of the proposed corporation or the corporators, or out of their dealings with the corporation or corporations. If they do so, they will not be allowed to retain their advantage or gain, but the transaction may be set aside in equity or they may be compelled to account or be held liable to respond in damages.”

In Yeiser v. United States Board & Paper Co. 107 Fed. Rep. 340, in the syllabus the court say:

“Promoters of a corporation, who become stockholders therein, assume a trust relation to the company and the other stockholders, which binds them to act openly and in good faith in all matters connected with its organization, and the acquiring of the property necessary'for the .transaction of the business for which it is organized, and they will not be permitted to make a secret profit on the sale of such property to the corporation. ’ ’

These principles of law are conceded by counsel for defendant in error, and the question is whether the averments of the petition make a case for recovery under these well established rules of law. The petition alleges that defendant represented to the stockholders and directors that he had purchased the furniture, fixtures and equipment for the bank and! that they “were of the value of $2,988.32.” That is not a statement or representation of a fact, but simply the expression of an opinion as to what they were worth. Waiving the form of allegation the question is not what they were worth, but what is the difference between the amount paid for them by the defendant and the amount which he received from the company for them. The averment that the furniture, fixtures and equipment of the bank were worth only $1,000 is also the expression of an opinion as to value and does not fix the measure of recovery as the difference between that amount and the amount which the bank paid, $2,988.32, or $1,988.32.

In Loudenslager v. Woodbury, 58 N. J. Eq. 556 [43 Atl. Rep. 671], it is said:

“To go beyond restitution and decree the actual payment of a sum of money never received by the defendant by way of profit or otherwise, is to impose a penalty of a sort and in a fashion unknown to courts of equity, aside from causes of actual fraud.”

The rule is so well recognized that it would be idle to cite authorities to show that the amount which a corporation is entitled to receive from a promoter is the profits which he actually received in dealing with or for the corporation; in other words, his secret profit.

Speaking for myself alone, I do not think that the amended petition states facts sufficient to constitute a cause of action against the defendant and that the first ground of the demurrer should have been sustained by the common pleas court.

Counsel for plaintiff in error contend that this action is one for relief on the ground of fraud, and that the action was begun within four years after the discovery of the fraud, the amended petition avers that the bank company is a corporation incorporated under the laws of Ohio; that on May 11, 1907, the stockholders organized by electing a board of directors and a cashier for said bank; that the defendant was present at said meeting and falsely and fraudulently represented to the stockholders and directors of plaintiff company that he had purchased for the company bank fixtures, enumerating them, and that “said fixtures were of the value of $2,988.32.” Then follows a statement in regard to the defendant depositing $1,600 and withdrawing the same. This seemed to be his private funds and we are unable to see how it is connected with this case, but following these statements is this allegation:

“Plaintiff further avers that it had no knowledge nor did any of its directors or stockholders, except the said defendant and the said Pollock, have any knowledge of the fraudulent transaction of the defendant or had any knowledge that the representations' made by him were fraudulent and false until in the year 1910.”

Assuming that the petition sets forth a cause of action for relief on the ground of fraud, that the cause of action accrued was not discovered until within four years of the time the ac tion was begun, such allegation would be good as against a demurrer. Zieverink v. Kemper, 50 Ohio St. 208 [34 N. E. Rep. 250], in the syllabus, the court say:

“"When it appears from plaintiff’s petition in an action for relief on the ground of fraud, that the cause af action accrued more than four years before the action was commenced, a general averment in the petition, that the fraud was not discovered by plaintiff until a time within four years before the action was brought, is sufficient to bring the case within the saving clause of the statute of limitations for such actions, without specifically setting out when the discovery was made, or how it was nade or why it was not made sooner.”

We come now to the question as to whether this is an action for relief on the ground of fraud and comes within the saving clause of the statute which provides that the cause of action shall not accrue until the fraud is discovered. In Carpenter v. Canal Co. 35 Ohio St. 307, 316, Okey, J., says:

''These sections (now Sec. 11224 G. C.) extended to cases .of an equitable as well as those of a legal nature.”

Waiving all questions as to the anomalous petition and assuming that it makes a cause of action for the recovery of the secret profits of a promoter, is such an action one for relief on the ground of fraud or is it one of breach of duty on the part of the promoter?

The petition alleges that the furniture, fixtures and equipment for the bank were sold by the defendant to the bank company on May 11, 1907, and if there was any fraud practiced by the defendant it was at the time of the sale of the furniture to the bank, and the statute of limitations would begin to run against the bank from that date, unless there has been a toll of the statute by undiscovered fraud.

In 1 Clark and Marshall, Priv. Corp. p. 325, it is said:

"To render the promoter of a corporation thus liable to account for secret profits made by him in the transactions on behalf of the corporation, it is not necessary to show that there was a fraudulent intent on his part. It is enough if the profits were made secretly, and without the consent of the corpora-tors.”

In Pietsch v. Milbrath, 123 Wis. 647 [101 N. W. Rep. 388; 68 L. R. A. 945; 107 Am. St. Rep. 1017], second syllabus:

‘ ‘ The right of action against the promoters of a corporation to recover illegal profits made by them in buying for the corporation,' at a price far in excess of its actual price, land on which they had obtained a secret option is one at law which is barred in six years from its accrual under Rev. Statutes 1808, Sec. 4222, and is not cognizable solely by a court of equity, within the exception of subdivision 7, which postpones the running of limitations until discovery of the right of action. ’ ’

Thompson, Corporations (2 ed.) Sec. 105, p. 117:

‘ ‘ The liability of promoters for secret profits made by them in transactions between them and the corporation is not based on the theory of 'fraudulent intent on their part, but grows out of their relation to the corporation and the duty which they owe such corporation and the persons with whom they are dealing. They are clearly liable, even in the absence of fraud, on a mere failure to make full disclosures of their position and purpose. Their liability is fixed and the right to recover established when it is made to appear that such secret profits were obtained by them without the knowledge or consent of the corporation or its members. It is not so much the purpose of equity to visit him with a penalty for concealment as it is-to require him to account for the profits actually made by reason of such concealment.”

We have examined many other cases which bear more or less directly upon the questions here involved, but we think the eases cited are sufficient to illustrate the law as we understand its application in such cases as the one at bar. Our attention has not been called to any decisions to the contrary in this class of cases, and we have not been able to find any. We think on principle that these decisions are right. When eases are clearly within the provisions of the statutes limiting the time within which actions shall be brought, we have no power to refuse their enforcement though they may work an occasional hardship.

The judgment of the court of common pleas will be affirmed.

Shields and Powell, JJ., concur.


author: KINKADE, J.

text:
    INSANE PERSONS — PARTIES.
    [Lucas (6th) Circuit Court,
    December 2, 1911.]
    Wildman, Kinkade and Richards, JJ.

      Benjamin F. Reno v. George R. Love et al.
    Substitution of Regularly Appointed Guardian in Action by Ward Discharged from Insane Hospital and Dismissal of Action not Prejudicial Error.
    A discharge of a person from a hospital for the insane neither vacates an order of the probate court appointing a guardian therefor, nor, in the absence of resignation or discharge affirmatively appearing of record, collaterally impeaches the order of appointment; hence, in an action by such ward in his own name to recover damages for his alleged illegal arrest and confinement, an order substituting the guardian as party plaintiff and a judgment dismissing the action do not constitute prejudicial error.
    Error.

      Benjamin F. Reno, in person.

      C. S. Northup, for the defendants served with process except defendants Chambers and Hurlbut.

      Affirmed, no op., Reno v. Love, 88 O. S. 623.

   KINKADE, J.

Mr. Reno brought an action in the court of common pleas against a large number of defendants to recover damages for his illegal arrest and illegal confinement for over four years in the Toledo State Hospital, for the insane. Some of the defendants were state officials, some were county officials and all were charged with having conspired and combined to accomplish the arrest and imprisonment mentioned.

One of the defendants filed a motion in the case asking the court to substitute Thomas Biddle, guardian of Mr. Reno, as plaintiff. This motion was heard and granted. Mr. Biddle thereupon dismissed the action. Reno objected to the substitution and d^missal of the action and preserved his exception in due form. He now. files a petition in error, with bill of exceptions containing all the evidence heard on the motion, in this court to reverse the judgment of the court of common pleas in dismissing the action.

The trial court on hearing the motion had before it the affidavit of Mr. Reno and the testimony of two physicians, both of whom said Mr. Reno was insane. The trial judge stated the question of the plaintiff’s sanity or insanity was not an issue on the hearing of the motion and that the only question before the court was whether the probate court of Lucas county had, before the commencement of the present action, appointed Mr. Biddle as guardian of. Mr. Reno, and whether this guardianship had been terminated in any manner provided by law. Thereupon Mr. Reno, as shown by the bill of exceptions, admitted in open court that the records of the probate court of Lucas county, Ohio, did show that Mr. Biddle had been appointed by that court as his guardian prior to the filing of the petition in this case, and that said records did not show that such guardian had resigned or had been discharged by the probate court. At the same time Mr. Reno informed the trial court that the records of said probate court also showed that prior to the beginning of this action, he had been discharged from the state hospital for the insane. Thereupon the order of substitution and dismissal was made.

The plaintiff in error claims that the evidence before the trial court as shown in the bill of exceptions failed to show affirmatively that the probate court had jurisdiction over his person when the appointment of Biddle as his guardian was made and hence he was at liberty in this action, although admitting as he did that the records of the probate court did show the appointment, to treat the action of the probate court as a nullity and wholly disregard it. He further contends that even if this proposition be not correct, still his guardian was discharged by reason of his own discharge from the hospital and hence the guardianship no longer had any force.

We can not agree with either of these propositions. His discharge from the hospital could not of itself terminate the guardianship. The guardian may have been appointed on grounds other than those on which Mr. Reno was sent to the hospital but whether this be so or not, a discharge from the hospital can not be held as vacating the order of the probate court appointing the guardian. Section 11010 G. C., which corresponds with Sec. 6311 R. S., provides the manner in which guardians may be discharged and reads as follows:

“Section 11010. When the probate judge is satisfied that an idiot, imbecile, or lunatic, or a person as to whom guardianship has been granted as such, is restored to reason, or that letters of guardianship have been improperly issued, he shall make an entry upon the journal that such guardianship terminate. Thereupon it shall cease, and the accounts of the guardian be settled by the court.”

The position taken here in argument that the judgments and orders of the probate court are not attended by the presumption that the court had jurisdiction to enter them (nothing to the contrary appearing in the record) and that the judgments and orders of the probate court may be collaterally impeached, is equally untenable. The law of Ohio on this subject is clearly stated in the case of Shroyer v. Richmond, 16 Ohio St. 455. I quote paragraphs six and seven of the syllabus:

“6. The probate courts of this state are, in the fullest sense, courts of record; they belong to the class whose records import absolute verity, that are competent to decide on their own jurisdiction, and to exercise it to final judgment, without setting forth the facts and evidence on which it is rendered.
7. Hence, an order appointing a guardian, made by a probate court, in the exercise of jurisdiction, can not be collaterally impeached. The record showing nothing to the contrary, it will be conclusively presumed, in all collateral proceedings, that such order was made upon full proof of all the facts necessary to authorize it.”

The Supreme Court has several times followed this decision. See Hoffman v. Fleming, 66 Ohio St. 163 [64 N. E. Rep. 63]; Fisher v. Lanning, 76 Ohio St. 189, 198 [81 N. E. Rep. 182]; Union Sav. Bank & Tr. Co. v. Telegraph Co. 79 Ohio St. 89, 100 [86 N. E. Rep. 478; 128 Am. St. Rep. 675],

The admission in open court by Mr. Reno as shown in the bill of exceptions fully justified the court in ordering the substitution of Biddle as plaintiff in the action. This being true, it follows there was no prejudicial error in allowing Mr. Biddle to dismiss the action. "We express no opinion on any other matter involved in the action as brought. The judgment of the court of common pleas will be affirmed.

Wildman and Richards, JJ., concur.


text:
    SPECIFIC PERFORMANCE.
    [Hamilton (1st) Court of Appeals,
    November 8, 1915.]
    Jones, Jones and Gorman, JJ.
    Fisher-Barkdull Farm Agency v. Harry M. Creager.
    Specific Performance Denied after Conveyance of Land to Third Person of which Plaintiff had Knowledge before Suit Brought.
    Where It appears that before bringing an action for specific performance oí a contract for exchange of one tract of land for another, the plaintiff had knowledge both actual and constructive of the conveyance to a third party of the land sought in exchange, a court will not retain the case for assessment of damages but will relegate the plaintiff to an action at law.
    Appeal.

      DeCamp & Sutphin and L. J. Brumleve, for plaintiff.

      H. J. Buntin, for defendant.
   JONES, O. B., J.

This is an action to enforce the specific performance of a contract to exchange a tract of land in Cincinnati for a tract of land in Florida. The contract provided for an even exchange of the two properties.

Before this suit was filed the defendant had sold and conveyed to a bona fide purchaser all of the Cincinnati land which under said contract was to have- been exchanged with plaintiff company for the Florida land. This sale was consummated and the deed of conveyance left for record with the recorder of Hamilton county, Ohio, three days before the filing of the suit, and constructive notice thereby given to plaintiff. The agent and attorney .of plaintiff were both personally told by defend-' ant that she had so sold her land, two days before the filing of this suit. Plaintiff therefore had both constructive and actual notice that it would be impossible for defendants to specifically perform their contract. The purchaser of the Cincinnati land is not made a party to the suit nor is any claim made that the sale was not made to him in good faith.

“Specific performance can not be decreed of an agreement to convey, property which has no existence or to which the defendant has no title; and if the want of title was known to the plaintiff at the time of beginning the suit thg bill, will not be retained for assessment of damages.” Kennedy v. Hazelton, 128 U. S. 667 [9 Sup. Ct. Rep. 202; 32 L. Ed. 576].

Plaintiff was fully advised before bringing this suit that defendants had conveyed away their title and that the contract could not be specifically performed. Under these circumstances the case would not be retained by the court for the assessment of damages, but must be dismissed, and plaintiff relegated to-an action at law where its remedy is adequate. Jones v. Tunis, 99 Va. 220 [37 S. E. Rep. 841]; Kerlin v. Knipp, 207 Pa. St. 649 [57 Atl. Rep. 34]; Eastman v. Reid, 101 Ala. 320 [13 So. Rep. 46]; Public Service Corporation v. Hackensack, 72 N. J. Eq. 285 [64 Atl. Rep. 976]; Mack v. McIntosh, 181 Ill. 633 [54 N. E. Rep. 1019]; National Tube Co. v. Tube Co. 13-23 O. C. C. 468 (3 N. S. 459).

As the case, however, was heard on evidence and fully argu.ed both orally and briefly, it might be stated that even if the land were still owned by defendants and subject to a decree for specific performance, that in the opinion of this court plaintiff corporation has failed to show that it would be entitled to such decree. And taking the land of plaintiff at its own valuation it would not appear that it has suffered any damage in failing to exchange it for that formerly owned by defendant.

Petition of plaintiff dismissed at its costs.