text:
    EMBEZZLEMENT BY AN OFFICER. OF A CORPORATION.
    Court of Appeals for Hamilton County.
    Carlotta Thompson Brown v. State of Ohio.

    Decided, March, 1914.

      Criminal Law — Conversion of Securities by Officer of a Brokerage Concern — Quilt Personal and Not Official — When Conversion of Securities Constitutes Embezzlement.

    1. When an officer of a corporation in the-transaction of its business violates a criminal statute, such as that relating to embezzlement, his act in that respect is personal and not official, and he is subject to the same responsibility for an act performed through the instrumentality of' a corporation as where the act is accomplished by any other means.
    2. Where securities are left in the hands of a broker for sale, and the proceeds from such sale are appropriated by the broker for his own .use and benefit, the crime so committed is embezzlement.

      Cogcm, WilUams & Ragland, for plaintiff in error.

      Thos. L. Pogue, Prosecuting Attorney, contra.
    Jones (Oliver B.), J.; Jones (E. LI.), J., concurs; Swing, J., dissents.

      Motion to require the Court of Appeals to certify its record overruled, April, 1915.

   This is a proceeding in error taken from the judgment of the court of common pleas, entered October, A. D., 1913, term of said court, adjudging the plaintiff in error guilty of the crime of embezzlement. The indictment returned jointly against the defendant and her husband, Henry A. Brown, was founded upon the. charge of embezzlement, and alleged that the plaintiff in error was the agent and employee of the prosecuting witness, Fred Sehroth, and that' as such agent she embezzled and appropriated to her own use moneys belonging to Fred Sehroth, which had come into her possession by virtue of her employment as the agent of Sehroth.

The record shows that at the instance or request of the husband of plaintiff in error', Henry A. Brown, who was an officer of the Thompson-Brown Company, two hundred shares of United States Steel Company preferred stock belonging to Fred Schroth, and-five shares of the same stock belonging to Elmer Schroth, were by him delivered to the defendant below as president of the Thompson-Brown Company and receipted for in the name of said company by her as its president, and that the stock was sold and the net proceeds of same, $22,007.77, was received by the defendant and deposited in the name of said company in the Fifth-Third National Bank of Cincinnati, and all checked out and used by her to pay her own obligations and the obligations of the Thompson-Brown Company.

. The stock was received and sold on March 31, 1913, and was at once forwarded to New York attached to a draft through the Fourth National Bank for the total amount of the sale, and the Fourth National Bank, on so receiving the certificates of stock to forward, at once gave to plaintiff in error in person its cashier’s check for $15,000 to the order of the Thompson-Brown Company on account of such draft and stock, and she endorsed that check in the name of the company by herself, as president, and placed it in the Fifth-Third National Bank in the account of the Thompson-Brown Company, and immediately began to check out the money to pay the obligations of herself and of her cotnpany. And on April 4, 1.913, after it had received notice of the acceptance of said draft on New York, the Fourth National Bank completed the payment for such stock by giving its cashier’s check to the Thompson-Brown Company for the balance of $7,007.77, which was also deposited to the credit of that company in the Fifth-Third National Bank, and plaintiff in error checked against that amount for her .own and her company’s obligations until the entire amount was so used.

The record shows that the Thompson-Brown Company was hopelessly insolvent at that time, the amount of its delinquency on April 4, 1913, being in excess of $69,000; that plaintiff in error was the president and in the active management of the company, and signed every check of the company constituting the embezzlement of these funds as charged in the indictment, and that there was then practically no money in its account in the Fifth-Third National Bank other than that consisting of the proceeds of the sale of the Schroth stock, the account showing that all other deposits were less than $340. The use of the money can not therefore be considered as an innocent mingling of funds by a broker in the usual course of business. The record further shows that plaintiff in error when questioned on behalf of Schroth, who was demanding his money, claimed that it had not yet been received by her or her company, making one false statement after another for the purpose of delaying action, when in fact she had then not only received the money, but had placed it in bank to the account of her company and had checked it all out of bank and used it for her own purposes.

It is urged on behalf of plaintiff in error that the court erred in admitting testimony disclosing transactions between witnesses for the state and the Thompson-Brown Company, claiming that the indictment contained no allegation sufficient to apprise defendant that she would be held to answer for the acts of the Thompson-Brown Company.

There can be no question of the correctness of the rule laid down in Dillingham v. State, 5 O. S., 280, and in DuBrul v. State, 80 O. S., 53, requiring an indictment to cover all the material facts necessary to be proved with such certainty and precision as to reasonably apprise the accused of what he may be expected to meet and be required to answer. But we do not understand this rule to require that evidence should be set out in the indictment.. Tf the act charged against the defendant below was done by her as president of a corporation it was no less an individual act, and she would be punishable only for her act as an individual and her official or corporate relations are only incidental and not so material as to become a necessary averment of the indictment. Barnett v. State, 54 Ala., 579, 584-5.

Counsel for plaintiff in error in effect claim that if any embezzlement of the funds of the prosecuting witness was shown, that it was the act of the corporation and not that of plaintiff in error.

A thorough discussion of the necessary elements constituting the crime of embezzlement is found in the opinion of Wilkin, J., in the case of State of Ohio v. Baxter, decided by the Supreme Court February 3, 1914 (Ohio Law Reporter, March 9), in which he quotes from Bishop’s New Criminal Law, as follows:

“The gist of common law larceny is the felonious ‘taking’ of what is another’s, with the simultaneous intent in the taker of misappropriating it. But in the statutory embezzlement there is ho felonious taking, for the thing comes to the servant by delivery from the master or a third person. So that the question now is, by what act, after it is received, does the servant commit the embezzlement? * * *
“If the servant intentionally does with the property under his control what one must intend to do with property to commit iarceny of it, he embezzles it, while nothing else is sufficient. Or assuming the needful criminal intent to exist, he must and need only do what in our civil jurisdiction is deemed conversion, defined to be any dealing with the thing which impliedly or by its terms excludes1 the owner’s dominion. To illustrate, if the servant instead of delivering the property to his master or another, as required by his duty, pledges it for his own debt, or runs away with it, or neglects or refuses to account for it, or otherwise wrongfully diverts its course towards its destination, to make it his own, he embezzles it. Yet much of even this is, when accurately viewed, rather evidence than the offense itself. For, to constitute the offense it is not necessary there should be a demand for the money alleged to be embezzled, or a denial of its receipt or any false account, * * * or refusal to account.” Sections 372, 373. * * #
“In strictness of language there are in larceny two intents: namely, to commit the asportation by trespass, and to make the felonious misappropriation of the thing stolen. Yet commonly and practically we mean my this term the latter. It is in this sense that the word is in the present sub-title employed. It means the purpose to deprive the owner of his ownership in the thing taken ; and whether or not for some advantage to the trespasser, or as otherwise expressed, for lucre, is one of the purposes to consider.”

It will be seen therefore that the criminal intent to convert the property, which is a necessary element of the crime of embezzlement, can not be had by a corporation; and as the crime is purely statutorj', it is not one for which a corporation can be held.

Tbe ease of Ebert v. State of Ohio, 2 C.C.(N.S.), 537 (aff. 71 O. S., 476), is directly in point to this- effect.

So far as the Thompson-Brown Company is concerned as instructive case is that of State, ex rel, v. Standard Oil Co., 49 O. S., 137:

Syl. 1. “That a corporation is a legal entity, apart from the natural persons who compose it, is a mere fiction, introduced for convenience in the transaction of its business- and those who do business with it; but like every other fiction of law, when urged to an intent and purpose not within its reason and policy, may be disregarded.”

When an officer of a corporation in the transaction of its business violates a criminal statute, such as that relating to embezzlement, his act in that respect is personal and not official. Re is subject to the same responsibility for such an act done by him through the instrumentality of a corporation as though it were accomplished by any other means.

A Wisconsin case, in which an embezzlement charge against two of the officers of a corporation is considered in an able opinion cited in the brief of the prosecuting attorney, appears to be directly in point. We quote paragraphs 1, 2, 3 and 4 of the syllabus. Milbrath v. The State, 138 Wis., 354:

“1. A corporation exists only in contemplation of law, and the legal fiction that it is a separate entity, though necessary for many purposes, can not be urged to an intent and purpose not within the reason and policy of that fiction.
“2. A person charged with a crime will not be heard to say in justification that he committed the-act in his official capacity as officer of a corporation; nor to assert that acts in form corporate acts were not his acts merely because done by him through the instrumentality of a corporation which he controlled and dominated in all respects and which he employed for that purpose.
“3. One may convert money of another to his own use by putting it into the treasury and mingling it with the funds of an insolvent corporation which is under his control and management and of which he is a stockholder and officer in charge; and the fact that the benefit which he receives is not equal to the whole amount of the money is- not material.
“4. Defendant and Ms partners in a loan and real estate business who had loaned on real estate security certain money entrusted to them for that purpose, organized a corporation to carry on the business. They were the sole and controlling stockholders and officers therein, and turned over to it all of the assets and business of the firm. Defendant was president. The money above mentioned was repaid at the office of the corporation in defendant’s presence, was mingled with funds of the corporation, and was retained and used by. it. The corporation was then insolvent, and defendant’s account with it was overdrawn and continued so to be.‘ The amount was credited on the books of the corporation to the owner of the money, but, for the purpose of concealing from her the fact that the principal had been repaid, the corporation, with defendant’s knowledge, continued to pay interest to such owner as if the loan were still outstanding. Afterwards the corporation was adjudged bankrupt. Meld: That the corporation was a mere instrumentality through which defendant had embezzled the money and converted it to his own use. ’ ’

The case of Ford v. State, 11 C.C.(N.S.), 324 (aff. 80 O. S., 722), is also instinctive the first clause of the syllabus is as follows :

“1. An individual member of a partnership who received money as an agent and secreted it with intent to embezzle and convert it to the use of the partnership may be convicted under Section 6842, Revised Statutes. The fact that the money is received by him as a member of a partnership makes no difference.”

It is also urged by plaintiff in error that no contract of employment or agency is established between defendant and the prosecuting witness. If it be conceded that the corporation, the Thompson-Brown Company, was the original agent employed by Schroth to sell his stock and that he had no acquaintance with or knowledge of the defendant below, it must be admitted that he realized that the corporation must necessarily act by its officers or employees, and while defendant may have first obtained possession of the stock as an officer of the company, she at the same time became an agent of Schroth acting for him as well as the company, and if she feloniously appropriated its proceeds she did so necessarily as an individual for her own benefit and that of the company. Such an appropriation would either constitute the crime of larceny or embezzlement, and as her possession was lawful in its inception, it becomes the latter crime and not the former.

■ Directly in point is the language of the court in State v. Pohlmeyer, 59 O. S., at page 496:

“The statutory definition of the offense regards the actual relation of the agent, servant or employee, and not the legality of the mode in which it was created nor the extent of the authority conferred. And the rule that one who receives money or any other thing of value in the assumed exercise of authority as agent for another, is estopped thereafter to deny such authority, applies in criminal prosecutions as well as in civil actions.”

As a further answer, the language of the court in State v. Carter, 67 O. S., 437-8, might also be quoted.

It is further urged that the court below committed error in excluding the certified copy of a petition filed in the United' States District Court of the Southern District of Ohio by Fred Schroth against the Thompson-Brown Company, in which he sought to recover from it the proceeds of said stock.

We do not regard this exclusion as error. Notwithstanding the fact that this fund had been embezzled, there would certainly exist a civil liability for it on the part of the Thompson-Brown Company, and possibly on the part of defendant below, and any effeort made by the owner to enforce its recovery could not affect the crime of its embezzlement or its misappropriation. The civil liability is undoubted regardless of the crime, and after the crime of embezzlement has been committed the repayment of the money does not undo the offense. State v. Baxter, supra.

Objections are also made to the refusal to give certain special charges and to certain parts of the general charge. A careful consideration of these objections fails to find any prejudicial error.

The judgment is therefore affirmed.

In the opinion of Swing, J., the record discloses that the act of the accused constituted larceny and not embezzlement, and for that reason he dissents.


source: Caselaw Access Project

author: By the Court

license: Public Domain

text:
    NO STATUTORY REQUIREMENT FOR. THE FENCING OF INTERURBAN ROADS.
    Court of Appeals for Richland County.
    C. E. Brindle v. Cleveland, Southwestern & Columbus Railway Co.
    Decided, January Term, 1915.

      Railways — Interurban Companies Not Required to Enclose Their Tracks With Fences — Absence of Fence Does Not Render Company Liable for Live Stock Killed.

    The provision of Section 8913, that fences shall be built and maintained on each side of railway tracks, does not apply to electric or interurban roads.

      B. T. Manner, for plaintiff in error.

      McBride (& Wolfe, contra.
   By the Court

(Shields and Powell, JJ.; Voorhees, J., not sitting).

The petition in error herein seeks a reversal of the judgment of the court of common pleas upon several grounds of error therein, but one ground of error only is insisted upon in this court, and that is that the court below erred in its instruction to the jury, as found upon pages 30 and 31 of the record, and which is as follows:

“Under the laws of Ohio, gentlemen, I will put it now so that you will squarely understand it. We have had a discussion here by counsel as to what the law of Ohio is and, as the court believes it to be, it is the duty of a steam railroad company to construct and maintain fences sufficient so as to prevent stock from leaving the adjoining fields and crossing over on to the right-of-way of the railroad company, and if they neglect to maintain a reasonably safe fence in that respect and cattle and stock pass over the fence so unreasonably maintained, and stock is injured by coming in contact with cars of the company, the company is liable; but this statute I have referred to has no/ application to an electric railroad company, under the authorities of this state, so that I will say to you, as a matter of law, that if you find from the evidence here that this is an interurban railroad company and not a steam railroad company, then the plaintiff is not entitled to recover. * * *
“So that if you find that this was an electric railway, notwithstanding that the plaintiff’s mule was killed, and that it was killed, if you should so find, by reason of the failure of the electric railway company to maintain its fence, and that it was killed while on the track by the motive power of the defendant company, yet that would not create, under the circumstances of this case, a liability, if this was an interurban railway company.”

Upon an examination of the authorities cited in support of the respective contentions of the parties hereto, we are of the opinion that Section 8913 of the General Code does not relate to or include an interurban railroad, and that said court below, therefore, did not commit error in giving to the jury the foregoing instruction.

In support of this holding we cite Cincinnati, Lawrenceburg & Aurora Electric Street R. R. Co. v. Lohe, Admr., 68 O. S., 101, which is cited with approval in Ohio Electric Ry. Co. v. Village of Ottowa, 85 O. S., 229.

The judgment of the court of common pleas will, therefore, be affirmed at the costs of the plaintiff in error.


author: Jones, O. B., J.

text:
    CONSTRUCTION OF THE MECHANICS’ LIEN ACT.
    Court of Appeals for Hamilton County.
    William F. Richards v. O. W. Bennett, Receiver of the Enterprise Lumber Co.

    Decided, June, 1914.

      Mechanic’s Liens — Good Faith on the Part of an Owner in Making Payments After Notice — Not a Defense Against the Claim of a Material-man.

    An owner who fails to retain in his hands a sufficient amount to satisfy the claim of a material-man, who has given the proper notice, becomes liable on such claim notwithstanding the payments which he made after notice were made in good faith and embraced only actual' pay rolls and bills for material necessary to complete the building.

      Dolle, Taylor ,c& O’Donnell, for plaintiff in error.

      Hunt, Bennett & Utter, contra.
    Jones (E. H.), J.; Swung, J., concurs; Jones (Oliver B.), J., dissents.

       Affirmed by the Supreme Court without opinion, May 4, 1915.

   This was an action brought below by a material-man against an owner, for money judgment, under Section 8324, et seq., of the General Code of Ohio.

The material-man in his petition claims that he furnished the head contractor certain materials for a building then being constructed for the plaintiff in error, Mr. Richards; that he gave the requisite notice in sufficient time, and that thereafter payments became due the head contractor from the owner, and that the owner neglected to retain a sufficient amount to cover, his claim and thereby under the statute the owner became liable for the payment of the claim.

The cause was tried beloiv by the court without the intervention of a jury. The court made separate findings of fact and law, giving the material-man, plaintiff below, a judgment for the full amount of liis claim with interest. The finding of fact shows that after the notice ivas served upon the owner, Mr. Richards, in compliance with the provisions of the mechanic’s lien law, he made payments to_the head contractor upon estimates by the architect, as he had done before and as provided for in the contract. In so doing he failed to comply with the provision of Section 8325, which reads as follows:

“Upon receiving the notice required by the next preceding section, such owner, board or officer or public authority, or authorized clerk, agent or attorney thereof, shall detain in his hands all subsequent payments from the principal or sub-eon-tractor to secure such claims and the claims and estimates of other sub-contractors, material-men, laborers, mechanics or persons furnishing materials tó or performing labor for any contractor or sub-contractor who intervenes before the next subsequent payment under the contract, or within ten days thereafter. ” .

.While it may be true that the payments'made in this case to the architect were made in good faith and only embraced the money necessary to meet the payroll and to pay for material necessary for the completion of the building, yet it constitutes an evasion or violation of the plain language of the section above quoted. To permit this to be done in any particular ease would open the door for collusion and fraud and result in nullifying the inhibition of said section.

We think, therefore, that the judgment below is correct and should be affirmed.

Jones, O. B., J.

(dissenting).

I dissent from the opinion of the majority of the court for the reason that in my opinion the record shows that all of the payments made by the owner after the service of notice of the lien upon him by the defendant in error were for labor and material that were necessarily used in the completion of the house, and no money whatever became due to or was paid the contractor for his own benefit or for his services after the notice of lien. The fact that the owner availed himself of the force of carpenters then working upon the house in the employ of the contractor and that instead of paying them direct he permitted the money to be paid to them through the contractor does not, in my opinion, operate as a payment to the contractor. All of the money paid was to meet these'pay rolls, the names' of the men and the amount of their wages being detailed each week, outside of a few trifling amounts for hauling and materials that were necessary expenses of the work about which there was no question, and the fact that the architect made estimates in a form similar to his previous estimates to cover these expenses does not change the situation.

The owner was entitled to proceed with the completion of his house in a proper method, and whatever was necessary out of the balance of the contract price to effect this purpose it was proper for him to expend, without liability to the claimant under the sub-contractor’s lien.

There is another objection to the claim of defendant in error. The affidavit for lien fails to set out promissory notes that were given covering this claim. Afterwards an order was given by the head contractor to plaintiff in error upon the owner for the payment of the amount due on this work, which the owner failed to accept. This order represented one of the notes which was paid by the credit obtained from the sale of a horse and wagon by the head contractor to the defendant in error, and this lien was in fact thereby satisfied.


text:
    DAMAGES FOR. FLAGRANT INVASION OF A HOME.
    Court of Appeals for Hamilton County.
    Spear & Company v. Jennie Fulton.

    Decided, February, 1914.

      Agents of an Installment House — Invade a Home and, Take Away Household Furniture to Which They Had No Claim — Damages as Fixed by a Jury and Subsequently Reduced by the Court — Charge to the Jury.

    1. Where the evidence clearly discloses that a flagrant outrage was committed upon the plaintiff by agents and employees of the defendant, a judgment in favor of the plaintiff will not be disturbed because of emphatic language in the charge to the jury with reference to the wrong committed, there being no error of law in the charge as given.
    2. The trial judge having declined to make a finding to the effect that his reason for granting a remittitur was a belief that the jury were influenced by passion and prejudice in fixing the amount of damages to be recovered, a reviewing court will not supply such a finding and bring it into the record.

      Johnson & Levy and Philip & 8. G. Boettinger, for plaintiff in error.

      II. G. Bolsinger and Louis Pink, contra.
    Jones (Oliver B.), J.; Swing, J., and Jones (E. H.), J., concur.

       Affirming Fulton v. Spear & Co., 13 N.P.(N.S.), 473; Court of Appeals affirmed by the Supreme Court without opinion, Spear & Co. v. Fulton, 90 Ohio State.

   Plaintiff in error, who was the defendant below, is a corporation selling furniture on the installment plan in Cincinnati. The defendant in error, Jennie Fulton, was at the time of the damage complained of living with her daughter, a young girl, in two rooms at No. 718 West Fifth street. She was then employed as a domestic at the Indiana Hotel, and generally left for her work at 6 .-30 a. m., returning about 9:30 p. m. She had never had any business dealings with Spear & Company, but it appears that the rooms she then occupied had formerly been the home of a Mrs. Stevens, who had bought furniture from Spear & Company, and owed that company money on account of same. It appears that a card or cards had been'placed under the door of Mrs. Fulton’s rooms asking Mbs. Stevens to call at-the office of Spear & Company and pay for her furniture, and there is evidence tending to show that Mrs. Fulton 'telephoned to Spear & Company asking them to desist sending such notices and stating that Mrs. Stevens was no longer there. There is also evidence tending to show that agents of the company made inquiries of neighbors in the building and were told thatv Mrs. Stevens no longer lived there.

It appears that agents of the company, on November 22, called at Mrs. Fulton’s room, while she was lying sick in bed, knocked at the door and made efforts to push open or break in her door and effect an entrance, using violent and absuive language, but being unable to do so left; and that on November 23, 391.0, two of the company’s employees again called at Mrs. Fulton’s residence about 7:30 a. m., and after some objections were permitted to enter in order to look at the furniture to show them that it had not come from Spear & Company; that they did look at it and discovered that none of it bore the marks of Spear & Co., but that it was marked with the names of other dealers, satisfying them that it was not the property of Spear & Co. After this investigation the men left for the purpose of reporting to the office of Spear & Co. and asking for instructions; later they returned stating that they had telephoned Spear & Go. and had been instructed to bring in the goods. Thereupon over the protest of Mrs. Fulton, the goods were taken from her home and conveyed to the warehouse of Spear & Go.; clothing was taken out of the dresser and thrown upon the floor, and Mrs. Fulton was compelled to get up out of the bed and dress and go out into the rain to the office of Spear & Co. to demand the return of her goods. After being satisfied of their mistake Spear & Co. returned the goods, which consisted of bedroom furniture and which were returned wet and damaged by exposure. At the time of this occurrence, Mrs. Fulton was suffering with tuberculosis and was confined to her rooms. Her experience and the exposure of her trip aggravated her case, confining her to her bed for a period of eleven weeks; and she claims that she suffered humiliation in the eyes and estimation of her neighbors.

On submission to the jury a verdict of $3,500 was rendered. The court found this to be excessive, and with the consent.of plaintiff a remittitur of $1,500 was entered and a judgment given for $2,000.

Proceedings in error are prosecuted here. The points of error chiefly relied upon are: first, that the court erred in its charge to the jury; second, that the court erred in entering a judgment in favor of the plaintiff for the amount of the verict-.as reduced by the remittitur.

While some of the language of the charge used by.the' court in defining the right of plaintiff in regard to the privacy and security of her home and her household property therein and its freedom from intrusion and molestation of defendant might he deemed somewhat oratorical in form, her legal rights are clearly and correctly stated, and at the same time defendant has not been prejudiced by anything unwarranted, and its rights duly guarded. The flagrant nature of the outrage perpetrated upon the plaintiff in taking away her bedroom furniture, notwithstanding her protest, after defendant’s agents had found the stencil marks of other dealers thereon and thus satisfied themselves that the company had no claims upon it, justified the use of emphatic language.

It is claimed that the court below found that an excessive verdict had been reached by the jury under the influence of passion or prejudice and that therefore it was erroneous for the court to enter a judgment after ordering a remittitur, and that 1 he whole, verdict was vitiated by this finding of passion and prejudice and should have been set aside and a new trial ordered. A copy of the opinion of the court in overruling the motion for a new trial is printed with the brief of the plaintiff in error to justify this claim. Counsel however expressly set out on page 20 of their brief that the trial court was most urgently requested by them to insert in the judgment entry as the reason why he granted the remittitur, that the jury was swayed by passion or prejudice, but that he absolutely refused to do so. The court below having declined, on defendant’s request, to make such finding, we can not now supply it and bring it into the record merely because of the language used by the court in its opinion and not carried into the judgment.

The remittitur made by the court below with plaintiff’s consent Avas properly made and was Avithin the poAA^er of the court. Carl v. Pierce, 20 C. C., 68, 72; Wabash Ry. v. Fox, 20 C. C., 440; American Contracting Co. v. Sammon, 6 C.C.(N.S.), 130; Pendleton St. R. R. Co. v. Rahmann, 22 O. S., 446, 450.

Other errors are complained of, but a careful revieAA' of the record fails to show any prejudicial errors as against the plaintiff in error and the judgment is therefore affirmed.


text:
    PROSECUTION FOR. BEING A KNOWN GAMBLER.
    Court of Appeals for Hamilton County.
    Samuel Hirsch v. City of Cincinnati.

    Decided, March 15, 1915.

      Criminal Law — Admissibility of Papers Taken by Officers on Occasion of the Arrest — 'Weight of Evidence Where it is All Given by Persons of a Single Class.

    1. In a prosecution for being a known gambler, papers, race horse slips and telegrams found at the time of arrest lying on the desk- of the defendant by the arresting officers are competent in support of the charge pending against him, on the same principle that incriminating tools found on the person of one charged with burglary, or counterfeiting devices found in possession of one charged with counterfeiting, are admissible in evidence though not necessary for conviction nor sufficient when solely relied upon to warrant conviction.
    2. The fact that the evidence introduced against one charged with being a known gambler was confined to persons of a single class, to-wit, members of the police department, is a matter which affects the weight of the evidence only, and where evidence so profferred was permitted to stand unchallenged, and no evidence was offered by the defendant, a finding of guilty will not be disturbed by a reviewing court.

      James S. Myers, for plaintiff in error.

      Walter M. Schoenle, City Solicitor, and Edwin S. Morrissey, Municipal Court Prosecutor, contra.
    Jones (E. H.), P. J.; Jones (Oliver B.), J., and Gorman, J., concur.

      Motion for leave to file a petition in error and to direct the Court of Appeals to certify its record overruled by the Supreme Court May 11, 1915

   Plaintiff in error was convicted as a “known gambler” in the municipal court of Cincinnati, under the provisions of Section 908 of the cit3r ordinances, which reads as follows:

‘ ‘ That if any known pickpocket, gambler, burglar, thief, watch stuffier, ball game player, or person who practices any trick game or device with intent to swindle or any suspicions person who can not give a reasonable account of himself, shall be found in the city of Cincinnati, such person shall on conviction thereof in the police court, for each and every offense be fined in any sum not less than five ($5) dollars or more than fifty ($50) dollars.1 ’

Upon proceedings in error in the common pleas court the judgment in the municipal court was affirmed, and this proceeding is prosecuted to reverse the judgment of affirmance of the common pleas court.

The errors complained of in argument can be embraced under two heads: first, it is claimed that the judgment should be reversed because the municipal court erred in admitting evidence in the form of papers, race horse slips, telegrams, etc., which were taken off the desk of plaintiff in error at the time of his arrest; and, second, it is claimed that the judgment is not supported by sufficient evidence in that the only evidence as to the reputation of Mr. Hirsch as a gambler or otherwise, and the only evidence in support of the allegation of the warrant that he was at the time a “known gambler,” came from police officers; and further, that.their evidence showed that their information was obtained wholly from other members of the police department.

As to the first ground of error several authorities were cited in support of the doctrine that papers obtained by means of unreasonable or unlawful search or seizure of the house or premises of a person can not be used as incriminating evidence against him. Of all the cases cited the one most directly in point and apparently most strongly relied upon is that of Boyd v. United States, 116 U. S., 616. In that case the question to be determined by the court is thus stated in the opinion by Mr. Justice Bradley:

“In a search or seizure, or what is equivalent thereto, a compulsory production of a man’s private papers, to be used in evidence against him in a proceeding to forfeit his property for alleged fraud against the revenue laws — is such a proceeding for such a purpose an ‘unreasonable search and seizure’ within the meaning of the Fourth Amendment of the Constitution?”

The court answered this question, in the syllabus of the case as follows:

“The seizure or compulsory production of a man’s private papers to be used in evidence against him is equivalent to compelling him to be a witness against himself, and in a prosecution for a crime, penalty or forfeiture, is equally within the prohibition of the.fifth amendment.”

The opinion of Justice Bradley in this case is quite lengthy, and is followed by a concurring opinion of Mr. Justice Miller some three pages in length. This case ivas brought by the United States authorities to establish a forfeiture of certain goods alleged to have been fraudulently imported without paying duties thereon. It appears from the facts in the case as stated in the opinion, that at the hearing or shortly prior thereto an order was made by the court upon the owner of the goods to produce for the inspection of the court certain papers and that in executing that order the officers made a forcible search and seizure of certain premises and thereby secured the papers desired. Upon the trial of the case, an objection being made thereto, these papers were excluded from evidence because of the manner in which they were obtained. In the concurring opinion, on page 639, Justice Miller says:

“The order of the court under the statute is in effect a subpoena duces tecum, and though the penalty for witness’ failure to appear in court with the criminating papers is not fine and imprisonment, it is one which may be made more severe, namely, to have charges against him of a criminal nature, taken for confessed and made the foundation of the judgment of the court That this is within the protection which the Constitution intended against compelling a person to be a witness against himself, is, I think, quite clear.
“But this being so, there is no reason why this court should assume that the action of the court below, in requiring a party to produce certain papers as evidence on the trial, authorizes an unreasonable search or seizure of the house, papers or effects of that party. ’ ’

So it would seem from the language of the court, that acting under authority of the order of court requiring a party to a suit to produce certain papers at the trial as evidence, the officers attempted to and did procure possession of said papers by force and by search "or seizure” of the house, papers or effects of that party.

There is such a statute in our own as'well as in many otfher states requiring the production of papers to be used as evidence, but we have never known of a case where it was even claimed that under an order made in conformity to such statute forcible entry, search and seizure of property or effects could be made; And it would seem most fair and reasonable for a court to hold that evidence secured in such unlawful manner could not be admitted against its proper custodian in an action to enforce a penalty or fasten a crime upon him.

In the case of Mr. Ilirsch these papers, wager slips, telegrams, etc., which were introduced in evidence were taken off his desk at the time that the officers walked into his office and arrested him. They had no warrant for him. Upon that day or the following day an affidavit was made aginst him charging him with the offense of being a “known gambler” found in the city of Cincinnati. A successful prosecution for this offense does not depend upon proof of particular acts of gambling. The offense is proven if it is shown to the court beyond a reasonable doubt that the accused is a "known gambler” — that is, if it can be proven that such is his general reputation in the community. ■ ■

As said by our Supreme Court in the case of Morgan v. Nolte, 37 O. S., 23, at page 26:

"In such cases the offense does not consist of particular acts, but in the mode of life, the habits and practices of the accused in respect to the character or traits which it is the object of the statute creating the offense to suppress.”

The result of the prosecution depended therefore not upon evidence of particular acts, but upon the general reputation as to the mode of life and pursuits of the defendant. The papers taken by the officers on the occasion of the arrest were not necessary to a conviction, as the city is not required to produce any evidence of particular acts of gambling. But such evidence was competent- and admissible in the same manner and upon the samé principle that incriminating tools found upon the person of one charged with burglary, or counterfeiting devices found in the possession of one charged with such crime may be properly admitted in evidence, although not necessary for his conviction nor sufficient when solely relied upon to warrant conviction. This defendant at the time of his arrest was “found in the city of Cincinnati.” Under the ordinance it was an offense for a “known gambler” to be found in the city of Cincinnati. That was a crime in itself, in order to prove which it would not be necessary to show that he had ever been guilty of any gambling in the city. In other words, it was only necessary,, for a conviction as stated above, to show that he was in Cincinnati and was known as a gambler. There was no violation of his rights in the act of taking the papers in question, and said papers were competent and admissible as evidence not of any particular act or acts of gambling but of the charge made against him, namely, that he was a known gambler.

In the case of Adams v. New York, 192 U. S., 585, it is held:

“The fact that papers, which are pertinent to the issue, may have been illegally taken from the possession of the party against wihom they are offered is not a valid objection to their admissibility. The court considers the competency of the evidence and not the method by which it was obtained. ’ ’

.It will be noted that the papers referred to had been illegally taken from the possession of the party and the court held 'that even so, it considered only the competency of the evidence and not the method by which it was obtained. It appears that the papers objected to.as evidence by counsel for Adams were taken at the time of his arrest and “had no relation whatsoever to the game of policy” which he was prosecuted for playing or operating. It seems from reading the opinion in the case that there was no exception taken to the admission of the policy slips and policy paraphernalia taken at the time of the arrest. The holding of the court with reference to private papers taken forcibly from the accused leaves no doubt as to its view on the admissibility of the papers directly connected with the crime charged in the indictment.

This Adams case was distinguished in a later case by the Supreme Court of the United States, where it was held:

“While an incidental seizure of incriminating papers made in the execution of a legal warrant, and their use as evidence may be justified, and a collateral issue will not be raised to ascertain the source of competent evidence. Adams v. New York, 192 U. S., 585, that rule does not justify the retention of letters seized in violation of the protection given by the Fourth Amendment where an application in the cause for their return has been made by the accused before trial. Weeks v. U. S., 232 U. S., 383.”

It will b.e noted that both the Adams and Weeks cases have to do with private papers, and it is the taking of such papers not bearing directly upon the crime that is discussed and considered. The conclusion must be drawn from these two cases that they leave no room for doubt as to the admissibility of the incriminating papers relating to the offense, taken from Hirsch’s desk at the time of his arrest.

The main evidence, however, upon the question of his being a known gambler, was the oral testimony of the witnesses called by the prosecution, who were members of the police department. This brings us to a consideration of the second error complained of for which reversal is asked, i. e., that this evidence was insufficient for the reason that it was confined to a class of persons and therefore can not be received as evidence of general reputation. Gambling is generally recognized and legislated against as a crime in all cities, and it is peculiarly within the province of the police department and its members to know where and by whom gambling is being 'conducted and carried on. The officers called in this case, upon direct examination testified unequivocally that the defendant was known to them as a gambler, and upon cross-examination stated that they had heard others so speak of him, although it is true that all of them testified that “the others” who had so spoken were mainly members of the police force or men connected with it in some capacity. The fact that the source of evidence was thus confined to a class may have affected its weight as showing the general reputation of the accused, but such fact does not affect the admissibility of the evidence. The accused called no witnesses to contradict this in any way and offered no evidence to show that he was not known as a gambler. No one came forward to testify as to that on his behalf. He subpoenaed no witnesses; offered no evidence to show by any one of his numerous acquaintances in the city of his residence that he was not known as a gambler or that he was a follower of any vocation other than that of gambling. In the absence of any such evidence, that of the witnesses produced on behalf of the state remained unchallenged and was sufficient, in our opinion, to warrant the trial judge in making a finding thereon against the defendant.

We find no error in the record of the proceedings of the trial court, and the judgment of the common pleas court in affirming the municipal court will be affirmed.


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    DETERMINATION AS TO AMOUNT STILL DUE A RAILWAY CONTRACTOR.
    Court of Appeals for Hamilton County.
    The Cincinnati & Eastern Electric Railway Company v. Bruno Ritty.

    Decided, August, 1913.

      Effect of Findings of Fact Made Toy Referee — Method of Treating Such Findings Toy a Reviewing Court — Good Fortune of a Contractor in Having Part of His Work Done Without Cost.

    1. In reviewing a judgment which in the court below was based on the report of a referee, the judgment will be treated as an entirety and modified or reversed only in the event of a finding that it is manifestly against the weight of the evidence.
    2. When the contractor for a railway “fill” has the good fortune to have a part of his work done for him without cost by the dumping of waste from excavations being made by the municipality, his claim that he should receive the benefit of his good luck in his settlement with the company is at least as strong as the opposing claim that the benefit should revert to the company.

      Chas. M. Leslie and Dinstnore & Shohl, for plaintiff in error.

      Waite & Schindel, contra.
    Jones (Oliver B.), J.; Swing, J., and Jones (E. H.), J., concur.

      Affirmed without opinion, Cincinnati & Eastern Railway Co. v. Ritty, 90 Ohio State.

   This was an action below brought by the contractor for the construction of a traction railway known as the Cincinnati & Eastern Railway, under a contract which provided a price per lineal foot for the complete construction and provided certain rates for work to be done not included under this lineal foot rate. By consent of the parties it was referred by the court to a referee to take the testimony and report same to the court with his conclusions on the law and facts involved in the issue, as provided in Section 11475 et seq., General Code.

Tbe referee’s report is very full as to all tbe matters in issue, and it is admitted by counsel upon both sides that his findings of fact on the evidence have the effect of a special verdict as provided in Section 11480, General Code, and has been decided in Lawson v. Bissel, 7 O. S., 129, 133. And counsel for plaintiff in error admit that the burden is upon them to show his findings of fact are against the decided weight of the evidence.

There is a difference between counsel, however, as to whether this court in reviewing the judgment of the court below should treat the judgment as an entirety, and in order to review it consider all of the items of the contract which were controverted before the re'feree, or consider only, matters that are specially drawn to the attention of the court here by the plaintiff in error and which of course are the matters which were found against plaintiff in error by the court below, plaintiff in error making this contention because no cross-petition in error has been filed on the part of the defendant in error.

The court is of the opinion that the judgment below should be treated as an entirety and should be modified or reversed by this court only in the event of its finding that this judgment is manifestly against the weight of the evidence. In order to determine this question, however, it has been necessary to go over the whole record of the case, which consists of a very large amount of testimony and exhibits. This labor of the court has been materially lightened by the very able oral arguments made by counsel, and their full, detailed and exhaustive briefs in which they give special attention to the parts of the record relied upon.

The claim of-plaintiff as set out in the petition is made out under eighteen different headings of items, some of which cover many distinct subjects. Plaintiff in error relies particularly upon errors claimed to have been made with reference to five of these items and the claims thereunder. It is however hardly necessary to discuss in detail these claims although the court has given careful attention to all of them. At the trial before the referee, counsel for plaintiff claimed to- have shown him to be entitled to a judgment for $67,607.84. The referee in his report took up these items in detail and discussed them separately, resulting in an allowance of $32,905.13. This report on being before the superior court was reviewed by it and further allow-anee was made to the defendant below on an item for overhaul, under article 31 of the contract, between stations 717 and 750, for which a reduction of $1,100.88 was made, and it also allowed a reduction for 10,000 yards of fill which was estimated to be the amount of material furnished by the water works trustees, being muck taken out of its tunnels and placed by them in the fill as being the most convenient place to waste it. -An allowance of $2,500 was given to the defendant for this. This fill was part of the work included to be done by plaintiff for which he was to receive 25 cents per yard, and he claims that if he had the good fortune to have a stranger volunteer to make part of the fill for him that he should receive the benefit of such work, while the railway company contends that he should only be paid for what he himself does. The referee took the former view of the matter, and the court in passing upon his report took the latter. It seems to us that the argument of plaintiff is equally strong with that of' the defendant, but as there is no cross-petition in error we are not disposed to change the judgment arrived at in that respect, but think that it may be considered in a way in passing upon other errors that are being urged.

The first claim that is urged by plaintiff'in error, being 404 lineal feet of track on a switch at a point called Seven Mile, near New Richmond, which ivas not ballasted, is one which we think has merit. A deduction is claimed at 15 cents per foot as the value of ballasting. We think, that the testimony fails to show that this ballasting was ever done by the contractor, and therefore find that a deduction of $60.60 should be allowed upon that item.

Another error seems to have crept in and was overlooked bly the court below in making the final figures of the judgment.' In the petition in setting out the items of account, credit was given to the company, for payments, by cash $116,600, and by order to insurance company $600; making together a total credit of $117,200. In deducting the credits from the amount found due the referee overlooked this credit of $600 and deducted only cash payment of $116,600 instead of total credits of $117,200. This seems to have been overlooked by the parties in preparing the entry by the court and was discovered after the case came into this court. This allowance of $600 should also be made.

Considerable argument was devoted to the question of gravel overhaul account. A question was raised as to whether the Avey gravel pit, which was tendered to the contractor by the company, was in fact a gravel pit and came within the terms of the contract requiring one to be furnished in Clermont county. The referee in addition to hearing the witnesses direct had the additional advantage of being taken out on the line to see this so-called gravel pit, and we believe his decision as to the amount allowed for gravel over haul was extremely favorable to the defendant below. We also think that the allowance made by the referee for the work performed by the company in completing the track laying and ballasting was rather liberal to the defendant when it is considered that a large part of the amount claimed was for the cost of changing the gauge of the track from the standard gauge of four feet eight and a half inches to the Cincinnati gauge of five feet two and a half inches.

There is some controversy between the parties in the matter of excavation for the ear bam. This was work that was done by the contractor outside of the general contract. It is clear that -a contract was made for this work, the only question being whether it should be paid for by the yard under the prices fixed by the general contract or whether, as claimed by the president of the railway company, a special price of $5,000 had been agreed upon for the entire work. It was of course incumbent upon the defendant to prove this special price, and we think they failed in that proof, but that the work was to be paid for according to the general prices for the contract.

Arguments were also made as to the binding force of the engineer’s estimate. The contract providing for partial estimates at intervals as the work progressed seems not to have been in any way followed during the progress of the work, and no final estimate was made on the completion of the work in the usual manner by the engineer in the capacity of a referee or arbitrator, as defendant claims he should be considered. On the contrary, the president of the defendant company seems to have taken the matter out of the engineer’s hands, and what is termed a final estimate was made by the engineer under his direction. We do not think, therefore, under the cases cited and the terms of the contract, that the contractor is bound by this estimate.

Considering, therefore, the whole record, and the arguments made pro and con as to the different controverted items, the court is of the opinion that the judgment below should be modified and the amount thereof be reduced by deducting therefrom the sum of six hundred and sixty and 60-100 ($660.60) dollars. With that modification, it should stand.


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    RAILWAY TRESTLE DAMAGED THROUGH NEGLIGENCE OF MUNICIPALITY.
    Court of Appeals for Hamilton County.
    The City of Cincinnati v. The Price Hill Inclined Plane Railroad Company.

    Decided, March, 1915.

      Negligence in Construction of Street- — Earth Slips and Damages a Railway Trestle — Salary of Officer of Company Overseeing Repairs Not an Item for Which City is Liadle.

    Damage to a railway trestle hy reason of the sliding of a bank of earth, due to negligence in the construction of a street for which the municipality is liable, can not be made to include the full salary of one of the officers of the company, who was compelled to devote much of his time during the period of repair to overseeing the work.

      Walter M. Schoenle, City Solicitor, and Constam,t Southworth, Assistant City Solicitor, for plaintiff in error.

      Alfred B. Benedict, contra.
    Jones (E. II.), P. J:; Jones (Oliver B.), J., and Gorman J., concur.

      Motion to direct the Court of Appeals of Hamilton County to certify its record in this case .overruled May 4, 1915.

   Defendant in error was plaintiff below and recovered a judgment for $6,123.60, representing the damages assessed by the jury for negligence of the city in the execution of some work connected with the improvement of Glen way avenue, which negligence, it was alleged in the petition, caused the soil of a certain hill to slip against and upon the tracks and piers of the rail-load of defendant in error, greatly damaging it.

Several grounds of error are presented in the brief of counsel for plaintiff in error and in oral argument with earnestness. The negligence charged against the city in connection with the work on Glenway avenue is the same-as that complained of in the case of Cincinnati v. Filser, 19 C.C.(N.S ), 112, in which case a judgment in favor of Filser against the city was upheld by our Supreme Court. The evidence in this case is practically the same as that produced in the Filser case, so that upon the question of the liability of the city there is no longer room for debate.

It is contended in the case at bar, however, that the defendant in error, by reason of the manner of original construction of the inclined railroad, is primarily responsible for the slip in the hillside and threrefore can not maintain this action against the city. The case of Cincinnati v. B. & O. S. W. R. R. Co., 17 C.C.(N.S.), 137, is relied upon in support of this contention, but the facts are entirely different in the two cases. We are unable to see where the case cited has any substantial or practical application to this case.

We have carefully considered the points raised in the brief and in the argument of counsel representing the city and are of the opinion that the only point that is well taken and in any way affects the correctness of the judgment below is the one with reference to the admission of evidence as to the salary of Mr. Rees E. McDuffie, one of the principal owners and an employee of the railroad company. The theory upon which his evidence was permitted to go to the jury was that as Mr. McDuffie devoted practically his entire time for the period during which the railroad company was compelled by reason of the slide to abandon its operation of the freight track, in overseeing the repair of same, the salary paid him for such period amounting to $154, would be an element of damages which the city would properly have to pay. While it may have been proper to have allowed to the plaintiff below great latitude in showing the labor and time required in making these repairs, we feel that it was carrying the rule too far to assess the full salary for a regular officer of the company, as a part of the damages in this case, and know of no authority for so doing.

We think, therefore, inasmuch as the evidence shows the amount of this item and the same is definitely fixed in the record, that substantial justice can be done by modifying the judgment rendered by the court below in accordance with this finding. ' ' ¡ v"’ HT

The error pointed out is the only error upon the record, and the judgment- will be therefore affirmed with the above modification.


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    COLLISION BETWEEN AUTOMOBILE AND STREET CAR.
    Court of Appeals for Hamilton County.
    The Cincinnati Traction Company v. Raymond R. Reilly.

    Decided, April, 1914.

      Negligence at a Street Crossing — Attempt to Turn Automobile Into Narrow Street Upon Which There Was a Street Railway — Machine Struck by Approaching Car.

    Where a chauffeur in attempting to turn into a narrow street collided with a slowly moving street ear before he had crossed the curb line, it is evident he did not exercise the care and prudence required by law, and a judgment recovered by him for damages to his machine will be reversed.

      Miller Outcalt, for plaintiff in error.

      W. E. Brooks and Herbert Jackson, contra.
    Jones (Oliver B.), J.; -Swing, J., and Jones (E. PI.), J., concur.

       Affirmed by the Supreme Court without opinion, May 11, 1915.

   This was an action below for injury to an automobile, and the Joss of hire for same while it was out of commission, resulting from a collision between the automobile and a ear of the Cincinnati Traction Company, which occurred on the night of May 1, 1910, upon John street just south of Court street.

The automobile was owned by plaintiff, who operated automobiles for hire under the name of the American Auto Livery Company, and it was driven at the time of the accident by Richard White, who was a chauffeur in the employ of the plaintiff below, and who responding to a call, had gone out to Chester Park and obtained a load of four men and was bringing them back to the city. During the ride they had made several stops for refreshments, and it is charged that some of the passengers at least were under the influence of liquor. The course of the automobile was east on" Court street and its driver undertook to enter John street from Court street. John street is very narrow, and has in its center a single car track on which defendant’s cars are operated northwardly.

Plaintiff’s chauffeur testified that it was impossible fpr the machine he was driving, which was a large seven passenger Packard, to pass a street ear on John street unless parallel with and close up to the curb of the street, and that on turning in from Court street he could not put it in such a position without passing over onto the track of the street car.

All of the witnesses in the case who describe the collision, except the chauffeur, agree that it took place almost at the south line of Court street just after the machine had turned into John street, and also agree that the machine was pushed but a short distance, two or three feet, by the car, which' stopped at once and which had been running slowly. When stopped, the front of the machine was jammed into the fender of the car which was reversed and drawn back to free "it, and the front of the machine was then at about the south street line while its rear was at about the south curb line. None of the passengers were injured, although the machine was badly damaged.

The evidence does not make out a case of negligence on the part of the defendant. The car was being operated a-t not more than the usual rate of speed and no opportunity was' given to the motorman to stop in time to avoid the collision, which took place almost immediately upon the entrance of the automobile into John street, while from the .chauffeur’s testimony it is evident that he did not exercise the ordinary care and prudence which is required of him by law, in turning into John street under the circumstances, and the collision was therefore the result. of his own negligence.

We are of the opinion that the verdict is not supported by the evidence, and the judgment is therefore reversed and the cause remanded for a new trial.


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    NATURE OF A DISCHARGE IN BANKRUPTCY.
    Court of Appeals for Crawford County.
    J. S. Morrow v. Jacob Pfleiderer et al.
    Decided, March, 1915.

      Revivor of Judgment — Discharge in Bankruptcy Available in — Conclusiveness of Judgment as to Discharge Under the U. 8. Bankruptcy Act as Amended in 1908.

    1. While a discharge in bankruptcy does not extinguish the debt, it does bar the remedy, and may be pleaded in any action or proceeding in which the debt is asserted or is sought to be made the basis of a recovery, including a proceeding to revive a judgment.
    2. The record of a judgment is conclusive of its character as a claim, for the purpose of determining whether it is within the exceptions from the bar of a discharge in bankruptcy, provided in Section 17 of the TJ. S. Bankruptcy Act as amended in 1903; hence, a creditor who seeks a revivor of a judgment rendered on a promissory note can not, upon the interposition of a plea of discharge in bankruptcy, for the purpose of bringing the judgment within said exceptions, under a pleading to that effect dispute or explain the record by proof aliunde that the note was given for property obtained by the judgment debtor from such creditor by false and fraudulent representations.

      Grow & Donithen, for plaintiff in error.

      Beer & Lent hold, contra.
    Kinder, J.; Crow, P. J., and Ansberry, J., concur.
   This proceeding in error is brought to procure the reversal of a judgment of revivor obtained by the defendants in error against the plaintiff in error by the consideration of the Court of Common Pleas of Crawford County.

Hereafter the defendants in error will be referred to as the plaintiffs, and the plaintiff in error as defendant.

The plaintiffs filed their petition under the statute, alleging the recovery of a judgment by" the plaintiff Jacob Pfleiderer against the defendant; the assignment by said plaintiff of an undivided three-fourths interest therein to the other plaintiffs; that thcs judgment had become dormant; and prayed a judgment of revivor.

The amended answer of the defendant, J. S. Morrow, alleged that in a proceeding in the District Court of the United States for the Northern District of Ohio, Western Division, in bankruptcy, he was adjudged a bankrupt; that the judgment sought to be revived was, in said proceeding, duly scheduled, proven and allowed; and that in said proceeding upon his petition it was duly adjudged that he, the said J. S. Morrow, was entitled to discharge from all his 'debts, including the judgment sought to be revived; and that a certificate of discharge in bankruptcy was duly issued to him.

The plaintiffs, by way of reply to the amended answer, averred that the judgment sought to be revived was secured on a debt which arose and was created by the transfer by the plaintiffs of certain of their personal property to the said J. S. M|orrow by reason of certain false and fraudulent pretenses and representations, knowingly and wilfully made by the said defendant to the plaintiffs, relative to the amount of real and personal property then owned and possessed by the said Morrow for the purpose of obtaining credit, which fraudulent representations are set forth in detail in said reply.

Wherefore they further aver that the said debt Avas not discharged, but is still a valid and subsisting liability of the said J., S. Morrow.

On these issues the case Avas tried and submitted to the court, and resulted in a judgment of revivor as prayed for in fftie petition.

Two grounds of error are set forth in the motion for new trial, which Avas overruled, and in the petition in error it is claimed:

First, that the judgment of revivor is not supported by, and is contrary to, the evidence.

Second, that the judgment is contrary to law.

At the trial, the plaintiffs offered a complete record of the case in which the judgment sought to be revived was entered, together with the assignment of a three-fourths interest therein to the plaintiffs other than Jacob Pfleiderer.

The defendant, J. C. Morrow, offered in evidence a certified copy of his discharge in bankruptcy. And thereupon, without objection by the defendant, the plaintiffs offered evidence tending to support the averments of the reply touching the sale of certain property by the plaintiffs to the defendant, J. S. Morrow; and that said J. S. Morrow made certain representations touching property owned by him at the date of such sale, to obtain credit from the plaintiffs; that such statements- were false and fraudulent: that the said J. S. Morrow was at the time an infant and executed his promissory note for such property then by him so purchased; and that afterwards, and before the maturity of said note, the said defendant became of age and married, and when said note became due, the note upon which the judgment sought to be revived was taken was executed by the said J. S. Morrow, his wife, Jessie Morrow, joining with him therein.

The questions presented by the record and in the briefs in this case are: ■

First, is a plea of discharge in bankruptcy available in a proceeding to revive a judgment? And,

Second, are the plaintiffs entitled to a revivor of the judgment notwithstanding the defendant’s discharge in bankruptcy?

This involves a consideration of Section 17 of the United States Bankruptcy Act of 1898 as amended in 1903, which, so far as it affects the case at bar, provides that:

“A discharge in bankruptcy shall release a bankrupt from all his provable debts except such as are * * * (2) liabilities for obtaining property by false pretenses or false representations,” etc.

That a plea of discharge .is available as a bar in a proceeding to revive a judgment has been repeatedly decided by the courts of other states and was recognized in our state in Newshuler v. Maule, 10 C. C., 232.

The record of the case in which the judgment sought to be revived was rendered, discloses that the action was upon a promissory note with a warrant of attorney annexed, with no hint of fraud or false representations upon the part of the defendant contained in the petition; and that the judgment was entered by confession, as authorized by said warrant of attorney.

Is the record of the judgment conclusive of the character of the claim upon which such judgment is based for the purpose of determining whether it is within the exceptions from discharge in bankruptcy provided by Section 17 of the United States Bankruptcy Act as amended in 1903? Or, •

May a creditor, as was done in this case, upon a plea of discharge in bankruptcy for the purpose, of bringing the claim within such exceptions, by pleading to that effect, dispute or explain the record by proof that the note was given for property obtained by the judgment debtor from such creditor by false and fraudulent representations? (

The first of these questions must be answered in the affirmative and the latter in the negative.

•These questions have been raised and determined under each of the U. S. Bankruptcy Acts of 1867 and 1898 and under the amendment of 1903.

The decisions are numerous and a few only will be cited.

In the case of Forsyth v. Vehmeyer. decided by the Supreme Court of Illinois, 52 Northeastern Rep., 55, it, was held that the question whether a judgment sought to be enforced against a discharged bankrupt was rendered for fraud committed by the defendant must be determined by the court from the record; that said judgment was- conclusive and that evidence would not be received to dispute the record.

This case was affirmed by the United States Supreme Court, 177 U. S., 177.

To the same effect is the case of Hargudine-M’Kittrick Company v. Hudson, 111 Federal, 361, which was affirmed in 122 Federal, 232.

In the case of Harrington & Goodman v. Herman, 72 Southwestern, 546, which, like the case at bar, was an action to revive a judgment rendered upon '¡promissory notes, the Supreme Court of Missouri held that the record of the judgment was con-elusive and that a judgment creditor could not, by reply to an answer averring discharge in bankruptcy, and evidence offered thereunder, go behind the judgment and prove that the claim upon which the judgment was based was in fact for fraud and misrepresentation.

The foregoing authorities are all either under the act of 1867 or the act of 1898, prior to the amendment of 1903.

It is insisted by the defendants in error that under the amendment of 1903 there is such a radical change in the statute as to make these cases inapplicable; and in support thereof our attention is called to the case of Thompson v. Judy, 22 American Bankruptcy Reports, 154, and the case of Peters v. United States, ex rel Kelly, 24 American Bankruptcy Reports, 206.

The question under consideration in the ease of Thompson v. Judy was, whether after the change by the amendment of ■1903 in the language of the statute from “judgments in actions for fraud or for obtaining property by false pretenses1 or false representations” to the language of the amendment “liabilities for obtaining property by false pretenses or false representations,” a judgment for fraud was still within the operation of Section 17 making the exception, and the court- in that case held, that the merger of the claim in a judgment did not destroy the character of the claim as one for fraud, but that looking to the record, the court would ascertain whether the claim represented by the judgment was in fact a liability, of the character indicated under the amendment of 1903 as exempt from discharge.

The case of Peters v. United States, ex rel Kelly, also a case under the amendment of 1903, reversed the case of United States, ex rel Kelly, v. Peters, reported in 22 American Bankruptcy Reports, at page 177, in which case the court received evidence touching the merits of the original case, to dispute the record of the judgment, and held that the case was not within the exception as provided in the amended act of 1903.

The reviewing court, in substance, held that this was improper, and, looking to the record of the judgment alone, decided that the judgment there under review was within the exception.

In this ease it was found that the trial court was in error for two reasons:

First, that it could not, under a habeas corpus proceeding, review the judgment either as to errors or upon its merits; and,

Second, that the judgment of the court under consideration was conclusive.

Attention is also called to the case of Strauch v. Flynn, reported in the 22 American Bankruptcy Reports, 246, s. c., 122 Northwestern Reporter, 320, in which it is held by the Supreme Court of Minnesota that in an action upon a promissory note in which a discharge in bankruptcy is plead, the plaintiff could not, by reply, and evidence thereunder, show that the money was loaned on a promissory note by reason of the false representations of the party executing the note and so bring the claim within the exceptions under the amendment of 1,903.

This, of course, is aside from the question of the conelusiveness of the judgment.

The judgment of the court of common pleas is contrary to law and reversed as to the plaintiff in error, J. S. Morro’w.


text:
    AS TO THE SETTING ASIDE A DEFAULT JUDGMENT DURING TERM.
    Court of Appeals for Hamilton County.
    The City of Cincinnati v. R. J. H. Archiable.
    Decided, February 15, 1915.

      Procedure — Defense Must he Shown before a Default Judgment Gan he Set Aside — Recovery of Taxes and Penalties Paid by One Who Purchased Property at Tax Sale.

    1. A trial judge is without discretion, in the face of a rule of court and the provision of Section 11637, to set aside a default judgment, even during the term at which it was rendered, without first requiring the defendant to show a valid defense and forthwith set it up before an order is made setting the judgment aside.
    2. Title may be quieted against a purchaser of land at a tax sale without requiring that the plaintiff first pay over the amount which the defendant has advanced by way of taxes and penalty, but tile decree should provide ior the amount so advanced fey the defendant with interest for which the law gives him a lien.

      Walter M. Schoenle and Saul Zielonka, City Solicitors, for plaintiff in error.

      William S. Little, contra.
    Jones (E. H.), J.; Jones (Oliver B.), J., and Gorman, J., concur.
   On the 25th of October, 1911, the plaintiff in error, the city of Cincinnati, commenced an action against the defendant to quiet the title to certain real estate at the corner of Erie avenue and Michigan avenue in said city, and which, was the property known and used as the town hall of Hyde Park, before the suburb was annexed to the city of Cincinnati. Defendant was duly and legally served personally, and on the answer day through his counsel he filed a demurrer to the petition, which was overruled on December 4, 1911, and he was given fifteen days to plead further. No answer or plea having been filed for five months, the plaintiff’s solicitor caused the ease to be noted on the default docket and in due course of time on May 28, 1912, a default decree was entered by the court in favor of the city of Cincinnati, quieting its title to the property described in the petition as against the defendant. Eleven days thereafter, on June 8, 1912, defendant’s counsel filed a motion to vacate and set aside the decree, alleging irregularity in entering the same; that the decree is contrary to law; and that plaintiff has not refunded to the defendant the amount of taxes and penalties and costs paid by the defendant, with interest thereon, as in the petition alleged. The claim of defendant, although no answer set up the same, appears to have been one for taxes and penalties paid, which were a lien upon the property and for the non-payment of which the property had been forfeited to the state. On June 26th the court made the following entry:

“The motion to set aside the decree quieting title is heard and granted, and the decree entered May 28, 1912, is hereby set aside and held for naught, to which the plaintiff excepts.”

Thereupon, plaintiff below prosecuted error to ths court and asks a reversal of the judgment of the court of common pleas setting aside the decree quieting title to the real estate claimed by it in its petition. Plaintiff in error, the city of Cincinnati, in its petition in error claims that said judgment is contrary to law, was entered contrary to the rules of the court of common pleas, especially the rule relating to setting aside defaults1, being Rule VI; and that in setting aside said decree in the manner and form in which it was done the court below abused, overstepped and exceeded its discretion in said matter, to the prejudice of the plaintiff in error. A transcript of the docket and journal entries are filed with the papers herein, and said entry appears to be the last one made in the case.

Now it is undoubtedly the law of the state that a court, during the term at which a judgment or decree is rendered, has inherent power and authority, regardless of the statutes, under the rules of common law, to set aside and modify its judgments and decrees at its discretion. Huntington v. Finch, 3 O. S., 445; Bank v. Doty, 9 O. S., 505; Niles v. Parks, 49 O. S., 370; Huber Manfg. Co. v. Sweeney, 57 O. S., 169.

Nowhere under our code is this wholesome rule abrogated, but the rule has been qualified by Section 11637, General Code (formerly Section 5360, R. S.), and to the extent that a limitation or qualification is provided under the code we are of the opinion that the courts are bound by the qualification to the rule. That Section 11637, which is under Chapter 6 of the code relating to "other relief after judgment,” provides that "a judgment shall not be vacated on motion or petition until it is adjudged that there is a valid defense to the action in which the judgment was rendered,” etc.

A default judgment is authorized upon failure to answer, under Section 11592, General Code, so that the defendant in this case being in default for answer, the plaintiff was well within its rights and the court was authorized to enter the judgment when it was rendered.

The rule of the common pleas court as to default, which was presumably adopted, to be observed at least by-the court, is as follows:

“Defaults, etc. — If a party neglect to file a proper pleading within the time provided by statute or rule of court, he shall be in default, and may be proceeded against accordingly. The clerk shall note the fact of such default on his appearance docket and on the docket of Room No. 8.
“The default may be set aside on such terms as the court may think proper, and the court may either order the proper pleading filed forthwith or may give such further time as may seem reasonable to the court. If a judgment has been entered upon the default it shall not be set aside, unless- at the same term of court the - party against whom the judgment was rendered present and offer to file the proper pleading in the case together with an affidavit of the party or the professional statement of his attorney, reduced to writing, setting forth that there is a meritorious cause of action or defense and the facts showing the nature of it, in which ease the court may set aside the default upon such terms as to costs as to the court may seem just, and shall order the pleading, for want of which such default existed, to be filed forthwith.”

' The record in this case fails to show a compliance with either the statute, Section 11637, or the above rule of court, and the question therefore presented is, whether or not the trial court abused its discretion in setting aside the default judgment, or whether or not he had the power to do so without ¿t least complying with the "statute, even if we assume that he might disregard the rule of his own court.

In Branden v. Hoffman, 46 O. S., 639, the Supreme Court, in passing upon the question involved in this case as to the right of the trial court to set aside the default judgment and construing this Section 11637, General Code (then Section 5360, Revised Statutes), says on page 642:

“The record in the case at bar does not show that before setting aside the judgment there was an adjudication upon the validity of the defense to the action, and until it was adjudged that there was a valid defense, there was, in our view, no authority in the statute to vacate the judgment. ”

With the record before us in the case at bar, it therefore appears that there was no adjudication of any defense or that defendant had a defense at all. There was no offer to file an answer setting np any kind of a defense, but apparently the court arbitrarily and without requiring an answer to be filed set aside the judgment, under the belief that he had the power to do so without requiring anything from the defendant. This court is of the opinion that such proceedings as were had in this case are not authorized by the statute, and we find numerous authorities to support this conclusion.

In Brandon v. Hoffman, 16 O. S., 639, it was held in the second paragraph of the syllabus:

“Although the court may have decided that there is good ground to vacate on motion such judgment rendered on default, at a preceding term, it is error to vacate the same before it has been adjudged that there is a valid defense to the action; and if, on error, such adjudication is not shown by the record, it will not be presumed.”

It further appears that Section 11636 specially provides that the court must try and decide upon the grounds to vacate or modify a judgment or order before trying or deciding upon the validity of the defense or cause of action.

In Pollett v. Alexander et al, 58 O. S., 202, it was held in the third paragraph of the syllabus:

“Upon the hearing of such motion (to set aside a default judgment) it is error for the court to enter a judgment of vacation before it has adjudged that there is a valid defense to the action. ’ ’

To the same effect is the ruling of the court in Lee v. Benedict, 82 O. S., 302.

In these cases just cited the motion to vacate and the vacation of the judgment were after the term at which the defaults were rendered. But in the case of Smead Foundry Co. v. Chesborough, 19 C. C., it was held that the same rule and the same Section 5360 (now 11637, General Code) should apply where the motion was made to vacate the default judgment within the term at which the default judgment was entered. In the first paragraph of the syllabus of this ease it is :

“Held: Therefore, that where an application is made more than three days after judgment, Section 5354, Revised Statutes, ought to be permitted to apply and govern, although the term had not yet expired.”

On page 785, the court employs this language:

“We recognize the fact that the Supreme Court has decided that at least* under certain circumstances a court of common pleas has control of the judgments that have been rendered in its court during the term while the term lasts and before final adjournment; but it seems to .us that that principle of law must be taken with certain modifications and be construed consistently with the statute which I have read. It certainly could not be intended by the Supreme Court to hold or decide that the court of common pleas may, of its own motion, its own free will, set aside during the term any judgment that may be rendered by that court.”

Sections 5359 and 5360 (now 11636 and 11637) are then cited and quoted, and the court applied the rules therein laid down to the setting aside of a default judgment within the term at which it was rendered, and on pages 785 and 786, says:

“Under our view of the case the first thing to have been done by the court of common pleas in these cases was to have decided upon the grounds to vacate or modify the judgments; and that it did.”

In the case of French Wax Figure Co. v. Jupp Baxter Co., 21 C. C., 764, the Circuit Court of Cuyahoga County had before it a ease in which error was prosecuted to the judgment of the common pleas court in setting aside a default judgment at the same term in which the default judgment was rendered, and upon motion of the defendant as in the case at bar.. It was held in this case that:

“In order to justify the common pleas court in setting aside a default judgment against the defendant and allowing an answer to be filed the defendant must show that he has a good defense to the action, and to do so, otherwise, is a clear abuse of discretion of the court justifying a reversal on error.”

In this ease the court violated its own rule with reference to setting aside defaults as was done in the case at bar, and the court held that this was an abuse of discretion. However, the rule of the court with reference to setting aside default judgments is the rule laid down with reference to setting aside any judgment in Section 11637, General Code, so that it was jiist as reasonable to apply the rule of the statute to the conduct of the trial judge as to apply the rule of the court. The rule of court invoked in this case was similar to the rule of the Common Pleas Court of Hamilton County as to default judgments. Commenting on the excuses given for failure to plead by the defendant, the court says in this case just cited, on page 766:

“That the excuse given for not filing an answer in time by counsel for defendant, is a very weak one, can not be denied; and the court would have been justified in refusing to set aside the judgment.”

In Fisher v. Fisher Foundry Co., 8 N. P., 344, it was held by the General Term of the Superior Court that the court below erred in vacating the judgment by default absolutely. If that judgment was improperly obtained, the court below should have suspended the same until it has been adjudged there is a valid defense to the action. (Citing 24 O. S., 625; 46 O. S., 639.)

Now Section 11637 is not made specifically to apply to cases in which it is sought to^ set aside judgments' after the term. The chapter in which it i's found applies to the vacating or modifying or relief after judgment. Section 11631 does specifically apply to the vacation of judgments after the term, and points out the mode of doing this. The language of Section 11637 applies to any judgment whenever or however rendered. It does not say a judgment shall not be vacated or modified after the term on motion or petition until it is adjudged that there is a valid defense to the action. Now we see no good reason why the limitation upon the court setting aside its judgment during the term should not apply under Section 11637, to the same extent as to actions to set them aside after the term, so far as requiring the defendant to show a valid defense. The rule of the common pleas court of this county recognizes the justice of the statutory rule, and followed it with reference to default judgments. In any event, we are of the opinion that there was an abuse of discretion in this case by the trial court in setting aside the default judgment in the face of the court’s rule and the rule of Section 11637, before requiring the defendant to show a valid defense and then requiring the defense to be forthwith set up and filed before setting aside the judgment.

We think it would be wise to follow the statutory rules laid down by Judge Baldwin of the Wood county common pleas court in the case of Metzger v. Zeissler, 13 N.P.(N.S.), 49, when application or motion is made during the term to vacate a judgment, wherein he holds that the provisions of Sections 11637 and 11638 should be applied.

It is urged by counsel for defendant that the court was justified in setting aside this default decree, because no provision was made therein for the repayment to defendant of the taxes and penalties which he had paid. But if he desired to recover these from the plaintiff he should have set up his claim by way of cross-petition, and upon the issues joined on the cross-petition the court below might have awarded him the sum found due with interest; but he could not as a condition precedent to the quieting of plaintiff’s title require the plaintiff to pay over the money which he claims to have paid out as laxes and penalty.

This proposition we think was decided in the case of Heffern v. Hack, 65 O. S., 164. Tn the first paragraph of the syllabus the court says:

“The owner of land, in an action to recover it from one in possession under a void tax deed, is not required by Section 2910, Revised Statutes, before he can have judgment rendered in his favor, to refund or tender the taxes paid by the defendant. Such tender, or payment may be made after judgment, but it must be made before process is issued on the judgment to turn'the defendant out of possession.”

This ease differs from the instant case in that it was an action for the recovery of the real estate, while this is an action to quiet the title.

But under the provisions of Sections 5766 and 5767, General Code, the law undertakes to secure to a person who has purchased at forfeited tax sale a lien for the amounts paid by him for taxes with interest thereon, and the petition in this case recognizes such a right and offers to repay defendant for the same. The decree as entered below overlooked this matter, and should have been modified so as to provide for a repayment of the proper amount of such tax claim and interest to him. This can no doubt yet be done by proper proceedings in the court below, or by agreement of the parties.

For the reasons stated, the judgment of the common pleas court setting aside its decree quieting title will be reversed, and the cause remanded for such further proceedings as are authorized by law. .


text:
    MODIFICATION OF ALLOWANCE OF ALIMONY UPON REMARRIAGE'QF WIFE.
    Court of Appeals for Hamilton County.
    Lucile Lawson Baker v. Thorne Baker.

    Decided, January 30, 1915.

      Order for Payment of Alimony Distinguished from a Judgment — Necessity for, Ceases Upon Remarriage of Wife and Allowance May he Modified.

    1. A decree for alimony is distinguished from an ordinary judgment in that it is regulated by statute and calls for sound discretion by the court in fitting the judgment as to the amount, time and manner of payment to the facts of the case in hand.
    2. Alimony is an allowance to a wife from the estate of her husband for her support, and upon her remarriage its payment becomes inconsistent and incompatible with accepted ideas regarding the institution of marriage; and where alimony is decreed in a gross sum, payable in installments running through a series of years, it will be regarded as ordered in contemplation of the wife remaining single and dependent upon her husband for support, and as such is subject to modification upon her remarriage.

      Harmon, Colston, Goldsmith & Hoadly, for plaintiff.

      Heady, Ferris & McAvoy, contra.
    Jones (E. H.), J.; Jones (Oliver B.), J., concurs; Swing, J., dissents.

      For opinion fixing alimony in this case see Baker v. Baker, 18 C.C.(N.S.), 302.

   On February 2, 1914, a decree was entered in the above case by which there was awarded to the plaintiff as permanent alimony the sum of $7,500 to be paid in sixteen equal quarterly installments beginning on May 1, 1914, each of said installments amounting to the sum of $468.75.

The cause came into this court on appeal from the court of insolvency, which court some time prior to said February 2, 1914, had granted to the plaintiff a divorce for the aggression of the defendant. On December 22 last, the plaintiff was married to one James A. Atwood, Jr., and now resides with her husband in the state of Connecticut. On January 11, 1915, the defendant filed an application or petition herein setting forth the facts above stated, and asking that the terms of said decree be modified and further payment of alimony as ordered therein be dis continued.

The facts above stated appeared from the evidence, and also that the plaintiff’s present husband, Mr. Atwood, with whom she is now living, is supporting her and is able to continue so to do.

It is important to note that the allowance to the plaintiff was made solely for her support. . There was no claim that she had brought anything in the way of property to the defendant upon her marriage to him, or that she had in any way contributed to the accumulation of any property by him. It has been argued with great ability that this court is without power to modify its former decree which, it is claimed, was in effect a judgment in favor of plaintiff, with time of payment postponed for the convenience of the defendant. In any other kind of a ease except an action for alimony this claim could be urged with greater force and would be entirely convincing. But a decree for alimony has not all the elements of an ordinary judgment. The matter is regulated entirely by statute in Ohio, and has ever been recognized, by our courts as a subject which calls for the exercise of sound discretion on the part of the court in fitting its judgment, as to the amount, time and manner of payment, to the facts as they appear in a particular case.

Alimony is an allowance made to a woman upon a decree of divorce given her for her support out of the estate of her husband. This plaintiff now has another husband and is, presumably, happily living with him. While.her remarriage is entirely proper and may be regarded as highly commendable, she must have understood upon re-entering the matrimonial state that such a step would make any further support, voluntary or involuntary, from her former husband inconsistent and incompatible with accepted notions respecting one of our most sacred institutions, and that therefore the decree in her favor against him might be affected by her new relations.

While not so expressed in the decree, the payment of the sum in installments running over a period of four years was so ordered in contemplation of her remaining single and dependent upon her divorced husband di;ring that time. The changed situation and relation into which she has voluntarily entered' necessarily suggests and indeed requires, to our minds, a change or modification of this decree.

Tn view of the fact that the sum allowed was made payable in sixteen equal installments, and that the payment of the first installment was postponed for three months after the entering of the decree, during which time she was compelled to support herself; and taking into consideration that the first payment ordered should probably have been made greater than the subsequent installments, and that at the time this application was filed an installment was almost due, we are of the opinion that in allowing this application and granting the prayer thereof we should 'do so upon the condition that the defendant pay to her the sum of $2,000, and that upon compliance therewith he should be discharged from further payment.

The. former decree may be modified accordingly.