text:
    (First Circuit — Hamilton Co., O., Circuit Court
    Oct. Term, 1885.)
    Before Judges Cox, Smith and Swing.
    The Cincinnati, New Orleans & Texas Pacific R’y Co., an Ohio Corporation, v. The Third National Bank, of Urbana, Ohio.
    A blank certificate of stock in a railroad company, which had been signed by the president of said company, and by G. F. 33., its secretary, was left with the latter to be used in making necessary transfers of the stock of said company, all of which had previously to said time been issued. Gr. F. 13. fraudulently and criminally filled up said certificate as one to himself for 100 shares of said stock, and without the knowledge of said company, or any of its officers, other than the said 33. hypothecated the same to the plaintiff, in this city in which the office of the company was situated, no inquiry having been made by the plaintiff at the office of the company as to its genuineness. There was evidence tending to show negligence on the part of the officers of the railroad company in failing to examine the books and papers of the company left with the secretary. The note of 33. not being paid at maturity, it was by the plaintiff presented to defendant, with a request that said stock be transferred to it, as its own, in conformity with the power of attorney of 13. on the back thereof, and on refusal to do so, this suit was brought to recover damages.

      Held: , 1. That in so issuing said certificate illegally, 33. was not acting as the agent of the railroad company, but for himself.
    2. That if there "was negligence on the part of the railroad company in the matter complained of, to entitle the plaintiff to recover on that ground, it must be of such gross character, as to be the equivalent of bad faith or fraud.
    3. That the plaintiff in taking from 33. the said certificate, without further inquiry of the officers of said company, as to its legality and validity, was guilty of contributory negligence.
    4. That the loss of the bank, if any, was not the natural and proximate result of the negligence of the directors of the railroad company in failing to examine the books of the company, but that the crime of 33. was the natural and proximate cause thereof.
   Cox, J.

This is a petition in error to reverse a judgment of the Superior Court of Cincinnati.

The action in that court was brought to recover the sum of $7,500, with interest from August 18, 1882, and costs.

The cause of action was set out in two counts :

First, after reciting that the plaintiff and defendant were corporate bodies, the plaintiff charged that at the time of the transaction referred to, Theodore Cook was the president and Geo. F. Doughty the secretary of the defendant corporation; that the by-laws of the defendant provided, among other things, that the certificates of stock of the defendant should be issued under the corporate seal of the company and signed by the president and secretary, setting forth the number of shares which are owned by the party to whom each certificate should be issued; and, further, that the secretary should keep the office of the company open during business hours, and should be the custodian of the seal of the company, and should affix the same with the attestation thereof whenever the official business of the company should require it, and that he should keep the stock ledger, and make transfers of the stock of the company.

. Plaintiff further alleges that a certificate of stock was issued by the company, signed by the president and secretary, bearing the corporate seal.

The certificate is numbered 473, and certifies that Geo. F. Doughty is entitled to one hundred shares of $100 each, of the capital stock of the company. This is signed by Theodore Cook, President, and Geo. F. Doughty, Secretary, and on the back of the certificate was printed a blank assignment, authorizing -to transfer the same on the books of the company.

Plaintiff further says that about the 17th of May, 1882, Geo. F. Doughty borrowed of plaintiff $7,500, and executed and delivered to plaintiff his promissory note, payable to himself or order, for that amount at ninety days, and deposited with it said certificate of stock as collateral security, and gave to plaintiff the power in writing to sell or collect, by public or private sale, said stock on the non-payment of said note at maturity; and Doughty then indorsed said certificate of stock, and delivered the same to the plaintiff, who then became the owner of said note and certificate, with the right to have the same transferred on the books of the defendant.

That on the 23d of February, 1883, it presented said certificate with the indorsement to defendant at its office in Cincinnati, and demanded that the stock should be transferred to it on the books of the defendant, and that defendant should pay it the dividend due on said stock; but that defendant wholly refused to so transfer it, and refused to pay the dividends declared on said stock, and refused to recognize plaintiff as a stockholder, or permit it to enjoy any of the rights of a stockholder.

That it made the loan of said money, wholly relying on the representation in said certificate that Doughty was then and there the owner of one hundred shares of the capital stock of defendant, and plaintiff says that defendant, by its acts, has deprived the plaintiff of the ownership of said shares of stock, and converted the same to its use, wherefore plaintiff asks damage for $10,000.

This count proceeds upon the theory that the certificate of stock was the genuine issue of defendant.

The second count, after proceeding with similar allegations to those above stated, then sets out “ that said one hundred shares were, as defendant alleges, an excess of the capital stock, which the defendant was, by its charter, authorized to issue, and the same was issued by the president and secretary illegally, and is wholly void; but that plaintiff has no knowledge of the illegal issue or the illegality of the stock, except such as is derived from information from defendant’s officer, and that if said certificate was an overissue of the capital stock of defendant, and was thereby illegal and void, it was negligently and fraudulently issued by the defendant corporation and by its president and secretary, and the representations therein contained were falsely and fraudulently made to plaintiff, by which he was induced, in the usual course of business, to purchase and pay for said promissory note and certificate of stock, wherefore plaintiff prays for judgment against defendant for $7,500, with interest.”

On the trial of the c'ase below, defendant filed a motion to require plaintiff to state on which count he would proceed to trial, whether he would rely on the charge that the certificate of stock was a legal issue, or upon that which charges that it was not.

This motion was overruled by the court.

A motion was also made to require plaintiff to separately state and number his charges. This was also overruled.

A motion was also made to strike out part of plaintiff’s petition, which was overruled in part, and granted in part, and leave given defendant to answer the same.

A motion was also made by defendant to require plaintiff to definitely state in its second cause of action, whether or not the stock therein described is or is not the valid issue of the capital stock .of the defendant. This motion was overruled.

June 13, 1883, defendant filed its answer in two counts, the first admitting that it is a corporation, and denying all the allegations of the petition. In the second count it states, that it is a corporation, and is a railroad; that its entire capital stock is three million of dollars, divided into shares of one hundred dollars each; that on the 8th day of October, 1881, the entire amount of said stock was subscribed for, fully paid and certificate issued to the respective subscribers therefor; that the pretended certificate for which suit was brought, was not issued by defendant, nor with its knowledge, or consent, or authority; but was issued by Geo. F. Doughty, fraudulently, for his own private purposes solety, and that Doughty did not then, nor has he since, owned said shares of capital stock intended to be represented by said certificate, and that the capital stock intended to be represented by said certificate is in excess of the capital stock of defendant, is an over-issue of said capital stock, void and of no effect, and represents no part of the capital stock of said company, of all which plaintiff had notice at the several times mentioned in the petition.

To this answer, plaintiff replied denying its allegation.

The case proceeded to trial before a jury, who returned a verdict finding for the defendant in the first cause of action, and for the plaintiff in the second cause, in the sum of $8,-473.75.

A motion for new trial was made by defendant, and overruled by the court, and judgment entered on the verdict.

This petition in error now assigns these causes of error :

1. Error of the court in overruling motion for new trial.

2. In refusing to give-charges asked for by plaintiff.

3. In giving charges asked for by defendant.

4. In overruling demurrer of defendant to petition.

5. In admission of evidence offered by defendant in error.

6. In ruling out evidence offered by plaintiff in error.

7. That judgment was given for defendant in error instead of plaintiff in error.

8. Other errors appearing on the record.

At the hearing of the case in this court, considerable argument was made and stress laid upon the inconsistent character of the twocounts of the petition,one suing on the certificate as if it were genuine and legal, and the other as if spurious and void, but issued through the negligence of defendant; and it was claimed that the motion to require plaintiff to specify the count on which he proceeded should have been granted, and also that it should specify in the second count whether it relied on the validity or invalidity of the issue of the certificate.

There should be no inconsistency between the different counts in a petition. The supreme court in Ferguson v. Gilbert & Rust, 16 Ohio State Rep., 91, says, “ and as the Code requires pleadings to be verified by affidavit, we must assume that the plaintiff did not claim or intend under the second and general count to set up and prove a state of facts inconsistent with the allegations of the first.” A different rule prevails as to an answer. By our Code a defendant may plead as many defenses as he may have, although they be inconsistent with each other. R. S., 5071; 29 Ohio St., 651, 655.

But we can not see any force in this argument in regard to the first count.

The jury found for the defendant on the first cause of action, and there is no judgment against it on that count, of which it can complain, and no prejudice to plaintiff.

It is also claimed that the court erred in overruling the demurrer to the second count.

First — Because plaintiff alleged in that count enough to show that the certificate was valid; and,

Second — That it did not allege that it was void, but only that defendant said it was void.

It is said this is hypothetical pleading, which is never allowed either in law or in equity.

What are the allegations of the petition as to the issuing of the certificates? They are substantially as in the first count:

“ That the defendant corporation issued the certificate of stock, duly signed by the president and secretary, bearing the corporate seal, and describing it as a genuine certificate; that it was for value received, transferred and assigned to plaintiff, and the plaintiff therefore became the owner of said one hundred shares.”

It nowhere in direct language affirms that the certificate was an overissue or illegal, but asserts that the defendant says it is an overissue, and is illegal and void.

The code requires a petition to contain a statement of facts constituting the cause of action in ordinary and concise language.

The statement of fact relied on in the count as the primary cause of action is, that the defendant issued in due form its certificate of stock; that the plaintiff became the owner and was entitled to have it transferred to its name and draw dividends, and that because it was .so refused, it has a cause of action; and the statement that defendant said, it was an over-issue, is but the statement of a reason assigned by the defendant why the transfer was not made, a statement made by defendant by way of defense to the plaintiff’s demand.

Suppose this were a petition filed to recover as for goods sold and delivered, and the plaintiff, after charging that he sold and delivered the goods to defendant, should aver that he demanded payment, and the defendant said he never purchased the goods nor were they delivered to him, and he refused to pay, what would be the issue to be tried by the court ? Not certainly what the defendant said about it, but the fact which the plaintiff alleged as the ground of action — to-wit, that he sold and delivered the goods to .the defendant.

So here, the plaintiff says the stock was issued by the defendant ; that it is the owner, and has a right to the transfer and dividends, and has been refused. These are the facts upon which his action rests. It counts on legally issued and valid stock. All the allegations of what defendant says, as to its illegality, are mere surplusage, and could have been reached by a motion to strike out.

But the petition, after alleging the defense of defendants to the legality of the certificate, without admitting that it was an overissue or illegally issued, goes on to build up a case on what it alleges defendant claims, not in any pleading, but has informed it before any suit was brought, and proceeds to say that “ if the stock was an overissue, it was by reason of- defendant’s negligence and fraud.”

Now here is no positive statement that the certificate was illegally issued. One of the well known rules of pleading is, that the facts must be stated with requisite certainty. This is thus defined in Gould on Pleadings, Chap.'4, Sec. 23: It consists merely in alleging them so distinctly and explicitly as to exclude ambiguity, and make the meaning of the averments clearly intelligible.” Section 26: It is sufficient, if the averments are so made that the adverse party, the jury and the judges, can fully understand the subject matter.” Tested by this rule, can it be said that it can be fully understood whether in this count plaintiff relies and intends to maintain that the certificate sued on is a genuine one, or that it intends to admit that it was spurious, and to rely on fraud and negligence of the defendant in permitting it to be issued ?.

Now, although our statute is liberal in regard to the construction of pleadings, still I think that what Lord Coke calls certainty ” is still required by us. That is defined in Gould on Pleadings, chapter 3, section 54, as what upon a fair and reasonable construction, may be called certain, without recurring to possible facts which do not appear; that is, without denying or avoiding by anticipation, possible facts which may operate against him, and on the other hand, without the aid’ of any supposable facts or circumstances not alleged by him.

I do not understand this to be a pleading in the alternative. Such pleading is not favored; a prayer in the alternative may be allowed, and is of frequent practice. But even the use of that must be on facts alleged to exist. A good example of this is given in Cadwallader v. The Granville Society, 11 Ohio Rep., 290, where the court say : “ If this bill had been framed in the alternative, demanding of the defendants what property they acquired from Poster, charging that it was under an illegal and void agreement, and asking that it might be set aside, or that if it should be held valid, the residuary interest of Poster might be subjected to the debt, it would afford an example,” etc.

The petition is open to the objection of improperly joining causes of action; as it stands, the defendant is necessarily driven to prepare and try one of two, or two causes of action :

First, to make such defense as he may have if the certificate were a legal one, and which may not involve any question of negligence in it, or any question of fraud, or illegal issue; and, second, another defense to a wholly different cause of action, involving illegality of issue, fraud and negligence. Each of these causes require different pleadings and different rules of evidence.

The object of pleading is, that the parties be brought to an issue, and that the issue so produced be material, single and certain in its quality. Stephens on Pleading, 155.

And the rule is thus laid down in Pomeroy on Remedies, 456: “ If the facts alleged in the pleading show that the plaintiff is possessed of two or more distinct rights, each of which has been invaded, or that the defendant has committed two or more distinct and separate wrongs, it follows inevitably that the plaintiff has united two or more causes of action; although the remedy applicable to each would be the same, the relief forms no part of the action.”

We are of the opinion, therefore, that the court erred in overruling the motion to require the plaintiff to state definitely in the second cause of action, whether or not the stock therein described is or is not the valid issue of the capital stock of the defendant.

The case proceeded to trial, however, on the second count, as if that where based on the ground that the certificate was illegally issued, and was so treated by the court' and the parties, and we think there was no error to the prejudice of defendant in overruling the motion.

In the course of the trial, numerous exceptions were taken to the rulings of the court.

The first is that the court erred in overruling the motion of plaintiff in error for judgment at the close of plaintiff’s testimony.

On examining the record, we find that the court only overruled the motion for the present, with leave to renew it at a later period; but as we do not find the plaintiff renewed it, we think he lost any advantage he might have obtained if he had renewed it.

It is claimed that the court erred in permitting plaintiff below to re-open the case by cross-examination of defendant’s witnesses in support of the second count. But the exception only goes to the order of trial.

“ Allowing evidence out of its order is within the discretion of the court, and if ground of error at all, it is only when it appears that a fair trial was thereby prevented.” Webb v. State, 29 Ohio St., 351.

It is claimed that the court erred in refusing to allow the word “ cancelled,” on certain certificates, to go in evidence. We do not think the court erred in so ruling, as the evidence did not show that it had been placed there by Doughty, the secretary.

It is claimed that the court erred in giving charges 13 and 16£, as asked by the plaintiff.

As to charge 13, we think as given by the court, it was erroneous ; that the court should have, on the fifth line of said charge, added after the word petition: “ after inquiry of the officers of the company as to the genuineness and legality of the certificate.” Board of Education v. Sinton, 41 Ohio St., 513.

A certificate of stock is a document signed by the president and secretary of the company, showing the true amount of the stock held by a stockholder in a company. R. S., 3254. The certificate is not the stock, for a stockholder may be the owner of shares without having any certificate to evidence the fact; he may be the equitable owner although the stock appears on the books of the company in the name of another. R. S., 3259.

These certificates are not negotiable under our statutes. Sec. 3171 makes all bonds, promissory notes, bills of exchange, foreign and inland bills and checks for a sum certain and payable to any person or order, negotiable by endorsement or payable to any person or assigns, negotiable on delivery, and when so negotiated, absolutely transfers and vests the property thereof in each and every endorsee or holder successively. R. S., 3171.

And he may maintain an action in his own name for the recovery thereof.

But a certificate of stock is not a promise to pay money, and therefore does not come under our statutory definition of a negotiable instrument. Nor is it negotiable under the ordinary significance in mercantile usage. Assignable is the more appropriate term to describe it. Daniel on Negotiable Instruments, section la.

And the person who takes it by assignment, takes only what right, if any, the assignor has in stocks which the certificate professes to represent. He takes it subject to all equities which may exist against it. Charter Oak Life Insurance Co. v. Smith, 3 Bulletin, 603.

A stockholder is only by statute, sec. 3255, entitled to a certificate for such stock as shall have been paid up. He may have the certificate and may have assigned it to another for value received, and yet by section 6255, while the certificate is out, the shares of stock being personal property, may have been levied on and sold upon execution against the owner, and the purchaser at such a sale would acquire an ownership, to the exclusion of the outstanding certificate.

And hence the necessity of the party who is about to purchase certificates of stock, to exercise care and prudence in making enquiries of the officers of the company as to the legality and genuineness of the stock.

Or the certificate may be a . forgery, or issued by persons wholly without authority. And hence the necessity of the party who is about to purchase certificates of stock in a corporation, to exercise care and prudence in making enquiries of the officers of the company as to the legality and genuineness of the certificate and the interest the assignor may have therein, for in all these respects the purchaser would only take the interest the assignor had in the certificate; and especially is this the case when the person claiming to own the certificate is an officer of the company charged with the duty of issuing the certificate, and in his own name he issues it to himself.

Claflin v. The Farmers’ and Citizens’ Bank, 25 N. Y., 293, was a case where the president of a bank, having a general authority to certify checks, certified his own check when he had no funds in bank, and it was transferred to a purchaser for value, and without notice of the want of funds. Held that the bank was not liable to the purchaser. The certificate was beyond the president’s authority, and the purchaser could not claim the right of a bona fide holder, because the face of the check showing the president’s attempt to use his official character for his private benefit, every one to whom it comes is put upon inquiry, and when the certificate is false, no one can recover against the bank as a bona fide holder.

And in the case of the Board of Education v. Sinton, 41 O. S. Reports, 504, decided since this case came into this court, where Davis, being one of the Board of Education, which had issued bonds to which his name was signed officially, negotiated them to Sinton for value received. The supreme court decided “ that Sinton was not an innocent holder. The bonds disclosed on their face that Davis was one of the directors, and as such might well have possession of the paper without the right to dispose of it on his private account. Under these circumstances the duty of inquiry was put upon Sinton. And, having taken the bonds without inquiry, he was guilty in law of contributory negligence, and is not entitled to the position of an innocent purchaser. He dealt for his own gain with Davis alone, and trusted him at his peril; and we know of no principle of law that now entitles him to look to the tax-payers for re-imbursement.”

To this it was said, it would be of no use to make inquiry of Doughty, for he was guilty of the fraud. But to this answer, the Supreme court i-n Strong v. Strauss, 40 Ohio St., 89, and Board of Education v. Sinton, 41 Ohio St., 513, say : “ There is much force in the words of Sir John Romilly, Master of the Rolls, in a leading case, Jones v. Williams, 24 Beavan 62. With respect to the argument that it was unnecessary to make any •inquiry because it must have led to no result, he says ‘I think it is impossible to admit of the validity of an excuse.’ I concur in the ruling in Jones v. Smith, 1 Hare, 55, that a false answer, or a reasonable answer, given to an inquiry made, may dispense with the necessity of inquiry; but I think it impossible beforehand to come to the conclusion, that a false answer would have been given which would have precluded the necessity of further inquiry.”

The court should have further instructed the jury in said charge, that to entitle the plaintiff to recover on the ground of negligence of the Board, that the negligence must be of such gross character as to be the equivalent of bad faith or fraud, and the loss must result as the natural and proximate consequence of such alleged omission of duty. And that if the loss of the plaintiff was directly occasioned by the criminal act of Doughty in issuing such false certificate, that even if the board was negligent in failing to examine the books of said company, and in discovering the wrong done by Doughty in other matters, that the crime of Doughty, and not such negligence of the board, was the natural and proximate cause of the loss.

This is the doctrine laid down by the supreme court in 41 O. S., 504-513, Board of Education v. Sinton, a cause decided by that court since this case was pending here. We think the principles cover this, and the court erred in not giving the law thus.

We think the court erred in not granting a new trial.

The testimony all tended to show that in issuing the certificate, Doughty did not act as the agent of the board, but was acting directly for himself, and the loss was not the natural or proximate result of the negligence of the board, but of the crime of Doughty.

In issuing the certificate Doughty was not the agent of the company. In the case decided by the Supreme Court of Massachusetts, May, 1885, reported in the November number of the American Law Record, page 393, Santiago Innerarity et al. v. Merchants’ National Bank, two or three points involved in this case are decided. The court says: “ The proposition that the director of a corporation acting avowedly for himself or in behalf of another, with whom he is interested in any transaction,' cannot be treated as the agent of the corporation therein, is well sustained by authority. Citing 16 N. J. Eq., (1 C. E. Green) 229; 27 N. J. Eq., (12 C. E. Green), 88; 4 Md., 341; 18 Kansas, 480; 5 Denio, 330-337; 10 Fed. Rep., 251; L. R. 7 Ch. App., 170; 26 Mich., 44.

Uoadly, Johnson & Qolston, and Ramsey, Maxwell & Matthews, for plaintiffs in error.

Stallo, Kittredge & Wilby, and Paxton & Warrington, for defendant in error.

And in the same case the court says that: While the knowledge of an agent is ordinarily to be imputed to the principal, it would now appear to be well established that there is an exception to the construction or imputation of notice from the agent to the principal, in case of such conduct by the agent, as raises a conclusive presumption that he would not communicate the fact in controversy, as whén the communication of such a fact would necessarily prevent the consummation of a fraudulent scheme the agent was engaged in perpetrating.” 3 Myl. & K., 699; L. R. 15 Ch. D., 639; L. R. 5 Ch. App., 358; 7 Ch. App., 161; 118 Mass., 147; 135 Mass., 453.

Without going seriatim into every charge, we hold that all charges given by the court contrary to these principles, and those refused involving them, were erroneous, and the judgment will be reversed and case remanded to the superior court for a new trial.

Smith and Swing, JJ., concurred.


source: Caselaw Access Project

author: Cox, J.

license: Public Domain

text:
    (Second Circuit — Fayette Co., O., Circuit Court
    November Term, 1885.)
    Before Judges Stewart, Shauck and Cox. (Judge Cox, of tlie First Circuit, talcing the place of Judge Williams.)
    E. A. Lewis et al., Partners as the Jefferson Bank, v. John D. Moon.
    1. A power of attorney to confess a judgment must be strictly construed, and the authority therein conferred cannot be exercised beyond the limits expressed in the instrument.
    2. A power of attorney authorizing one to appear in court and confess a judgment, does not authorize tho entry of an appearance before the note becomes due, and an appearance prematurely entered by virtue of said warrant, confers on the court no jurisdiction of the person of the maker, and the j udgment so entered is invalid.

      3. A negotiable note was dated November 10,1884, payable to the order of Gr. one day after date; the day of date must be excluded, and no action can be maintained on the note until the lapse of the full third day of grace.

    4. One, not a party to such judgment, has a right to collaterally impeach it, whenever in any case it is attempted to be enforced against him, or to prejudice his rights.
    Error to the Court of Common Pleas of Fayette County.
   Cox, J.

The plaintiff in the action below filed a petition to foreclose a mortgage given by John D. Moon on certain real estate therein described.

John W. Gray was made a party defendant, and set up a judgment obtained by him against Moon on the 13th of November, 1883, for $1,207. To this answer and cross-petition of Gray the plaintiff filed a supplemental answer, and as a third defense set up that the judgment of Gray was based on a promissory note of Moon, dated November 10,1883, and payable one day after date to Gray, or order, for $1,267.70, with 8 per cent, interest, and attached to it was a power of attorney, authorizing any attorney-at-law “ at any time after the above sum became due, with or without process, to appear in any court of record in the State, waive the isssuing and service of process and confess a judgment for said amount, with interest and costs.

That on the 13th of November, 1883, an attorney appeared by virtue of said power of attorney, waived service for Moon and confessed judgment for the amount.

That said attorney had no right or authority of law to so appear, waive service and confess judgment, as there was no right of action on said note, it not being due at that time, and that therefore said judgment is of no effect. To this defense a demurrer was interposed, which was sustained, and thereupon the court proceeded to distribute the proceeds of sale of said property, ordering $1,045, the balance in the hands of the sheriff, to be paid to Gray, whereas if said judgment had not been sustained, said money would have gone to the plaintiff on his claim.

Error is assigned to the sustaining of the demurrer, and to the judgment ordering.the funds to be paid to Gray.

It is claimed by plaintiff in error, that the note ,on which judgment was alleged to have been taken,Swas entitled to three days of grace, and therefore would not be due until the 14th day of November, and there was no authority in the power of attorney to confess judgment on the note until it was due, and that therefore the judgment so confessed was void.

It is not claimed that Moon appeared in court personally and consented to the jurisdiction of the court.

It is well settled that a power of attorney to confess judgment must be strictly construed, and the authority therein conferred cannot be exercised beyond the limits expressed in the instrument. Cushman v. Welsh, 19 Ohio St., 536.

A power* of attorney, authorizing one to appear in court and confess judgment, does not authorize the entry of an appearance before the note becomes due, and an appearance prematurely entered by virtue of said warrant, confers on the court in which it is entered no jurisdiction of the person of the maker. Spier v. Corll, etc., 33 Ohio St., 236.

Was this note due on the 13th of November, 1883 ? Our statute, sec. 3171, makes all promissory notes for a sum certain and payable to any person or order negotiable. And by sec. 3175, all such notes payable at a certain day after date or sight, are entitled to three days of grace in time of payment.

What are days of grace ?

They were originally days allowed by way of favor to' the drawer of a foreign bill, to enable him to provide funds for its payment without inconvenience; and were called “ days of grace,” or “respite days,” because they were gratuitous, and dependent on the holder’s pleasure, and not to be claimed as a right by the person on whom it was incumbent to pay the bill.” By custom, however, they became universally recognized, and although still termed “ days of grace,” they are now considered, wherever the law merchant prevails, as entering into the constitution of every bill of exchange and negotiable note, both in England and the United States, and form so completely a part of it that the instrument is not due in fact or in law until the third day of grace, Bouvier’s Die. “ Days of Grace,” Daniels on Negotiable Instruments, 614; Chitty on Bills, 422, 1 Peters, 25, 12 Wheaton, 213.

A demand of payment on the day before or after the third day of grace, would not authorize a protest, or charge drawer or endorser. 1 Peters, 25; 49 Ala., 242.

“ No action can be maintained on such a note until the lapse of the full third day of grace.” 69 Ind. R., 353; 102 Mass., 65.

When was this note due ? In computing the number of days a note has to run, the day of the date is always excluded. Daniels on Negotiable Notes, 626.

No suit could therefore be instituted against the maker before the 14th of November, and the confession of judgment under the power of attorney on the 13th was unauthorized.

Is the judgment rendered, void or voidable?

A court can only render a personal judgment when it has jurisdiction of the subject-matter and of the person against whom judgment is sought to be rendered, and a personal judgment rendered against one over whom the court has no jurisdiction, is wholly invalid. Spier v. Corll, 33 O. St., 236.

The defendant in this case did not appear in person in court to confess judgment, and the only authority given to an attorney was to appear for him after the note became due. It follows that as the judgment was taken before the note become due, it was invalid.

Can the .Jefferson Bank in this proceeding avail itself of the want of validity of the Gray judgment?

It is claimed that it cannot; that this is a collateral proceeding; that the only way to take advantage of the defect is under those sections of the statutes which authorize new trials and and other reliefs after judgment (Sec. 5354), and that if the judgment is good between Gray and Moon, no other person can complain, except the judgment debtor.

The general rule laid down by the supreme court in Spier v. Corll, 33 Ohio St., 236,is, that “the jurisdiction of a court or tribunal entering a judgmenton any particular case, may always be enquired into, when such judgment is made the foundation of an action, either in a court of the state in which it was rendered, or of any other state.” That case, it is true, was between the immediate parties to the judgment. But the rule laid down in regard to impeaching judgments collaterally is this, that “ the parties to an action cannot impeach or set at naught the judgment in any collateral proceedings, on the ground that it was obtained by fraud or collusion.” They must take some proceeding prescribed by law to annul the judgment, and can not, in the absence of such annulment, treat it as invalid.” Freeman on Judgments, Sec. 834.

Mills & Van Pelt and Van Deman & Chaffin, for plaintiff in error.

Mills Gardner & F. G. Carpenter, for C. W. Gray.

It is only third persons who have the right to collaterally impeach judgments. They are accorded the right, because not being parties to the original action, nothing determined by it is as to them res judicata. Freeman on Judgments, Sec. 334; Cowen, Hill & Edwards, note 291 to Phillips on Evidence.

But it is not all strangers who are entitled to impeach a judgment. Only those strangers who, if the judgment were given full credit and effect, would be prejudiced in regard to some pre-existing rights, that are permitted to impeach the judgment. Being neither parties to the action, nor entitled to manage the cause, nor to appeal from the judgment, they are by law allowed to impeach it whenever it is attempted to be enforced against them. Freeman on Judgments, Sec. 335.

And any such party may, without reversing it, prove that it was erroneous and void, in any suit in which its validity is brought in question. Freeman on Judgments, Sec. 337; 4 Cushing, 27; 11 Metcalf, 370; 2 Metcalf, 135; 4 Oowan, 458.

Now, the Jefferson Bank was no party to the action of Gray v. Moon; it could not attack it on error, could not appeal from it, and it is set up in this action and attempted to be enforced against the plaintiff, to take a fund to which it would otherwise be entitled.

In that, the court below erred in sustaining the demurrer and ordering the balance of funds to be distributed to Gray. We think the judgment should be reversed, and the case remanded to the court of common pleas for further proceedings.

*


author: Albaugh, J.

text:
    (Fifth Circuit — Knox Co., O., Circuit Court
    May Term, 1885.)
    Before Judges Adbaugh, Jenner and Follett.
    Mary J. Swan v. Reasin W. Shahan et al.
    1. E, an unmarried woman, and the mother of the plaintiff, then an infant child, made a parol contract with W. (who had no children), with the knowledge and consent of his wife, in which he agreed to take the plaintiff and adopt her as his own child and heir, and treat her as their own daughter; and that at the death of W and his wife, she-should succeed to and become the owner of all the property of which he should die seized and which remained at the death of his wife. He took the plaintiff in pursuance of this agreement and changed her surname to that of their own, and entered the name and date of her ■ birth as the daughter of W. and wife in the family record, and always thereafter, up to the time of the death of W. recognized her as their daughter and taught her to believe that they were her true parents, and she was married with that understanding and belief. W.. died without making any provision for the fulfillment of the contract upon his part. After the full performance of the agreement on the part of the plaintiff, and her said mother, and the death of thg wife of W. Held, 1. That the agreement is not void for the want of consideration.
    2. That such part performance is sufficient to take the agreement out of' the operation of the statute of frauds and the.plain tiff is entitled to a decree for specific performance.
    3. Such agreement is capable of being performed within one year, and not within the statute of frauds.
    4. That the action is for equitable relief, and is not barred by. the six year clause of the statute of limitations. Nor is the plaintiff a creditor of the decedent within the meaning of Sec. 6113, R. S., and the action is not barz-ed in four years.
    Appeal from the Court of Common Pleas of Knox County.
    The petition sets forth in substance, that in the year 1840, the plaintiff was about two years of age, and resided with her mother, Nancy J. Elliott, a single woman, who had the sole-care and custody of her) that during said year, James E. Woodbridge and Lydia T. Woodbridge, his wife, requested the said Nancy J. Elliott, the mother of the plaintiff, to permit them to take the said plaintiff to their home ánd adopt her as-their own child; and as an inducement to grant said request, they informed said Nancy J. Elliott, that they had no children, and did not expect any ever to be born to them, and that they had abundant means to keep and provide. for the plaintiff; and as a further inducement to grant said request they promised and agreed with. the plaintiff’s said mother, that if she would give up plaintiff to them, and forever afterward renounce all claim and right to the care and custody of her said child, they would adopt and keep said plaintiff as their own child and heir, and that she should be cared for and provided for by them the same as if she. was their own daughter, and that the said James E. Woodbridge would make her his heir, and that she should succeed to the title and possession of his property at his death, with all the rights, claims and privileges thereto that she would were she his own child. And it was further agreed that the plaintiff’s said mother should keep secret from her said child her true parentage and never make herself known to the plaintiff, as it was the desire and wish of said Woodbridge and wife, that plaintiff should grow up supposing ' them to be her true parents, and that she should bestow upon them all the love and affection she would were she their own daughter.
    That relying upon said promises, the said plaintiff’s mother did consent- that said Woodbridge and wife should take the plaintiff and adopt her as their own child, and to have the care, custody and control of her during her minority that they would were she their own daughter. That in pursuance of said agreement, the said Woodbridge and wife did take the plaintiff to their home in Mt. Vernon, Ohio, and immediately thereafter changed the plaintiff’s name to that of Woodbridge, and wrote in the family record the name and date of her birth as follows : “ Mary J. Woodbridge, born February 2nd, A. D. 1838.” And from that time until the death of said Woodbridge they called the plaintiff their daughter, and taught her to call them father and mother, and they always gave the plaintiff to understand and caused her to believe that she was their own child, and they gave the plaintiff’s husband, E. G. Swan, to understand and caused him to believe that she was their own daughter, and thes said Wood-bridge gave his consent to plaintiff’s husband, as her father, to marry her, and on the 17th day of May, 1870, said Wood-bridge performed the ceremony of giving plaintiff’s hand away in marriage to the said Swan; that said Swan, the plaintiff’s husband, did not learn that his said wife was not the daughter of said Woodbridge and wife until after the death of the said James E. Woodbridge. That after her marriage the said plaintiff and her husband frequently visited at the house of Woodbridge and wife — visiting them as her father and mother, and they received her as their daughter.
    Plaintiff further avers that the said mother on several occasions .visited .at the home of said Woodbridge and wife, while she was there, to see her; but that pursuant to said agreement she did not disclose that she was plaintiff’s mother.
    That no children were ever born to said Woodbridge and wife. That on the 28th day of August, 1874, the said James E. Woodbridge departed this life intestate, seized of real and personal property amounting in value to $40,000, without providing by will or otherwise for the carrying out and performance of his said agreement with the plaintiff’s said mother. That immediately after his- death the said Lydia T. Wood-bridge informed the plaintiff for the first time that she was not the daughter of said Woodbridge and wife; that up to that time plaintiff had no knowledge of her true parentage, but supposed and believed that she was the daughter of the said James E. Woodbridge and wife. That the said Lydia T. Woodbridge well knowing the agreement between her husband and plaintiff’s mother, and for the purpose of deceiving the plaintiff and preventing her from asserting her right and claim against said estate, under and by virtue of said agreement and the performance on their part by the plaintiff and her said mother, falsely and fraudulently represented to the plaintiff that she was taken while an infant by them to raise only, and that she had no rights to, or claim against said estate ; and that the said Lydia T. Woodbridge would not then, or at any time thereafter, disclose to the plaintiff who her mother was, and concealed from her her true parentage. That Lydia T. Woodbridge then took letters of administration upon said estate and converted said estate to her own use. That on the 25th day of March, 1875, said Lydia T. Woodbridge died, leaving a last will and testament in which the said defendant, Shahan, was made executor. That said Shahan was duly appointed and qualified as such executor, and took possession of the whole of the real and personal estate of said James E. Woodbridge, amounting then in value to the sum of $39,000, claiming the same to be the property of the said Lydia T. Woodbridge, and has since been in the control thereof. Plaintiff avers that she did not learn of said agreement, nor her true origin and parentage until April 15th, 1882.
    Plaintiff therefore prays that she be adjudged and decreed the owner and entitled to the possession of said eastate, real and personal, and that the defendant, Shahan, be required to account and turn over to her all moneys, credits and property of every kind coming from or belonging to the estate of James E. Woodbridge, and for other proper relief.
    To this petition Reasin W. Shahan, executor, filed an answer, the first defense of which is in the nature of a general denial of the averments of the petition.

      Second — That the alleged contract was for the transfer of real estate, was not in writing and is within the statute of frauds.

      Third — That the alleged contract was not intended to be, nor was it capable of being performed within one year; was not in writing and is within the statute.

      Fourth — That the cause of action did not accrue within six years next preeeeding the commencement of this action.

      Fifth — That James E. Woodbridge departed this life on the 28th of August, 1874. That on the 1st day of September following, his wife, Lydia T. Woodbridge, was appointed and qualified as administratrix of his estate. On the 22th of March, 1875, said Lydia T. died. On the 2nd day of April following, Charles Baintree was appointed administrator de bonis non; that he has fully settled said estate and that more than five years have elapsed from the issuing of letters of administration upon said estate before the commencement of this suit. That the same is barred by the statute of limitation.

      Sixth — That the property and estate of which said James E. Woodbridge died seized, did not come to him by descent, devise or deed of gift, and that by his death it descended to his wife as sole heir; that she left a last will and testament, by which the defendant Shahan was made executor; that he was appointed and qualified as such, and that more than five years have elapsed since his said appointment and publication of the notice thereof, before the commencement of this suit, and that the same is barred by the statute of limitations.

      Seventh — That Lydia T. Woodbridge bequeathed to the said plaintiff the use of six thousand dollars during her life, and that she accepted the same with full knowledge of all her rights, and has not paid or offered to pay back any portion of the sums received by her under said bequest.

      Eighth — Avers the death and administration of the estate of James E. Woodbridge as set forth in fifth defense, and the death, last will and testament of Lydia T. Woodb'ride, and the appointment of defendant, Shahan as executor: that the said plaintiff did not present the claim on which this suit is founded to the said Lydia T. Woodbridge as administratrix, or to the said Shahan as executor, for allowance; nor did either of them disallow the same.
    To the second, third, fourth, fifth, sixth, and eighth defenses, the plaintiff demurred, and she filed her reply to the seventh defense, to which defendant demurred.
   Albaugh, J.

The most important question presented for our consideration is raised by the demurrer to the second defense, and if we are right in the conclusion we have reached as to that, the other questions are not of difficult solution. The able arguments of counsel on both sides, have not been strictly confined to the questions presented by the several demurrers; but it has also been claimed and elaborately argued, that the contract upon which this action is based, is void for the want of mutuality, and for inadequacy of consideration. The validity of the contract in these respects must necessarily be determined in the discussion of the question made by the demurrer to the second defense, because if it is void for the want of either of these elements, there would be nothing upon which the relief invoked could be predicated. In considering the sufficiency of this defense, we must assume that' all tire allegations of the petition are true.

For the purpose, then, of understanding the nature and extent of the contract claimed,and of determining the rights of the parties under it, we must look to all its terms, the position and surroundings of the parties at the time it was made, and the subject matter therein contained, as well as the legal requirements that are essential to its validity. The motive that actuated the mother of the plaintiff to enter into this agreement, is easily understood; she was charged with the duty of the care, custody and control of the plaintiff, then an infant, as its mother, and had, we assume, the natural parental love and affection for her child; and while she was transferring that care and responsibility to Woodbridge and wife, and thereby freeing herself from that duty, she was, at the same time, transferring to them the affections of her child, and rehouneing and relinquishing that tender love and care that mothers have for their offspring, as well as securing the advantages to it that persons in affluent circumstances would guarantee. On the other hand, it'appears from the petition, that the Wood-bridges were childless, and that they never expected children to be born to them ; their conduct toward the plaintiff immediately after receiving her and during the life time of Wood-bridge, is sufficient to warrant the conclusion that their object .and desire was to procure for themselves that happiness in their declining years, that the affections of a child taken in its infancy, in ignorance of its true parentage, could be trained to bestow upon them as its supposed parents, and upon whom they could bestow their favors and affections.

We are unable to believe as is claimed by counsel for the ■defendant, that it was an act of charity, or intended to be such on the part of Woodbridge and wife; all their conduct repels such an idea. It was stipulated that the plaintiff should not be permitted to know her true ancestry; that she should be taught to believe that she was their child, and with that view 4 it was agreed that the mother, upon her visits to the plaintiff, should refrain from the natural exhibition of the feeling of a mother for her child, and from making herself known to it. Its name was changed to “Woodbridge,” and an entry made in the family record of the name and date of birth, and in this .she was called the daughter, and so recorded, of Woodbridge and wife, so that upon examination of this agreement, we must conclude that the.advantages derived from the transaction to the parties were reciprocal. The plaintiff’s mother made a beneficial arrangement for her child, and the affections of Woodbridge and wife were satisfied by the adoption of a daughter.

In the case of Van Dyne v. Vreeland, 11 N. J. Eq., 381, the contract upon which relief was sought was almost identical with the contract claimed in this case. The court say in that case: “ There is no consideration of-public policy which should forbid the court countenancing such an agreement; considering the situation of the parties and their circumstances in life, it was beneficial to all parties, and cannot be considered as injudicious or unreasonable.”

In Smith v. Hogden, 62 Mo., 114, the court say: “ There are things which money cannot buy; a thousand nameless and delicate services and attentioris incapable of being the subject of explicit contract, which money, with all its peculiar potency, is powerless to purchase. The law provides no standard whereby the value of such services can be estimated, and equity can only make an approximation-in that direction by decreeing specific execution of the contract. The reasoning and authorities would seem a sufficient answer as to any lack of mutuality in the contract under consideration; but after a contract has been fully performed and acquiesced in, as in the present instance; after a contracting party has received all the anticipated benefits arising from a faithful performance, it must be apparent that it would be altogether inequitable to permit such party at this late period, when the law can afford no adequate redress, to raise objections on the score of mutuality.”

But it is claimed that the contract is for the transfer of real estate, and not in writing, and, therefore, within the statute of frauds. This would be a complete defense to the action, unless’there has been such part-performance on the part of the plaintiff and her mother, as would take the case out of the statute. The facts as disclosed by the petition, show that the mother left nothing undone that she agreed to do, and that the agreement upon her part was fully and completely performed according to its terms. The plaintiff was placed in the care, custody and control of Woodbridge and wife, and remained there during all the time until her marriage; and it is not claimed that she in any way failed on her part to so conduct herself as to be wholly consistent with the duties and obligations of a daughter, and that her marriage was even such as to invoke the sanction and approbation of her adopted parents. She was brought up from her childhood in ignorance of her true mother, and with the full understanding and belief that she was their daughter, and there is no act of misconduct complained of, either in the failure to render services, or in disobedience; but on the contrary, it appears to us that in all things there has been complete realization of all the anticipated benefits, derived from the contract to Woodbridge and wife.

Upon what principle, then, can they be excused from the performance of the contract upon their part ? The theory upon which equity proceeds in administering its specific remedy in such cases is, that one party having promised another to treat the agreement as binding, and to dq, positive acts based upon such presumption, it would be a fraud on him to repudiate his undertaking and set up the statute as an obstacle in the way of its completion. The doctrine is most frequently applied to contracts for the sale of land which have been partly performed by the purchaser, but is not confined to these; it is extended to those contracts concerning things personal or things in action, which the statute of frauds requires to be in writing,..but which, when verbal, are in their nature, capable of part-performance. “ Payment of the purchase money alone in contracts for the sale of real estate, made in whatever manner, will not ordinarily take the agreement out of the'operation of the statute. It does not so change the situation of the parties as to render a legal remedy impracticable or inadequate, to recover back the amount paid by an action at law; but where it is impossible to restore the party to his original position by any legal remedy, when the fundamental conditions of the equity jurisdiction in case of part-performance are fulfilled, that such payment is sufficient to take the verbal contract out of the statute of frauds.” Pomeroy on Specific Performance, 40, 161.

And in Watterman on Specific Performance, 46, the author in speaking of the rule that payment of purchase money upon contracts for land is not sufficient to take a parol agreement out of the statute, says: “ But the rule that the payment of the consideration will not in general be|deemed such part-performance as to relieve a parol contract from the operation of the statute of frauds, does not apply where the consideration is labor and services of such a peculiar character, that it is impossible to estimate their value by any pecuniary standard, and where the vendor did not intend to so estimate them.”

In Rhodes v. Rhodes, 3, Sand. Ch., 279. The plaintiff entered into a parol agreement with his brother, in which it was agreed that the plaintiff should provide for, and attend him during his life, and at his brother’s death he was to have all his property, both real and personal; the contract was performed on the part^of the plaintiff, and the brother died without having made any provisions for the execution of his part of the agreement. It was held that in general the payment of the consideration is not such part-performance of a parol agreement for the purchase of lands as will relieve it from the operation of the statute of frauds. But where the consideration consists of services to be rendered, which are of such a peculiar character that it is impossible to estimate their value to the vendee by a pecuniary standard, and the vendor did not intend to measure them by such a standard, the performance of the contract will entitle the vendee to a specific performance of the contract, notwithstanding the contract was by parol..

Also, in Lester v. Lester, 28 Graft., 737, it was held, that where a father entered into a parol contract with one of his sons, whereby he agreed to give him all of his property in consideration .that the son would support his father and mother during their life-time, that upon performance on the part of the son, he was entitled to relief, and that he would recover the property from a brother to whom it had been conveyed.

In Vandine v. Vreeland, 11 N. J. Eq., 371, before cited, the father of an infant child made an agreement with an uncle of the infant, at the uncle’s request, to the effect that the uncle should take the infant and adopt him as his own child, and that he would treat him as his own son, and that the property he should have, should be given to the child, so that it should belong to him at the death of the uncle and his wife. The uncle took the child and had him baptized, and the child assumed his surname and lived with him twenty-five years. It was held that the child might maintain his bill upon the agreement after such performancethat under such an agreement, from which benefits are to accrue to the child upon his performance, the party for whose benefit the agreement is to be performed, and especially if any valuable portion of the consideration has been rendered by him, has the legal right to enforce it, and it is of no consequence that the promise to fulfill is not made directly to the person who is entitled to the remuneration. It is enough if it was made by some one who had authority to make it and on his behalf.

It is further contended, however, that the plaintiff is not entitled to relief by way of specific performance, unless it appears that the failure on the part of Woodbridge and wife to comply with the terms of the agreement would operate as a fraud upon her. This is without doubt the well, settled rule, and unless her condition has been so changed, or unless she can have no adequate legal remedy, she would not be entitled to relief. That the plaintiff cannot have a remedy at law, is apparent from ¡the very nature and character of the services performed by her. It would be impossible to make them a ground of recovery at law. It was not intended that she should perform services alone in the legal acceptation of that term, but she was to occupy the position and perform the duties of a daughter, to receive and accept the love and affections of her adopted parents, and reciprocate the same. By virtue of the terms oí the contract, she had become their child as much so as though she had been really born to them. She •owed to them the loyalty and obedience of a child to its natural parents, and they in turn were charged with her custody, education and control, and were entitled to her services. Shé performed the duties and obligations of a daughter. She received and accepted the attentions of the man whom she afterward married as the daughter of Woodbridge and wife, and was married as such, and they fraudulently suppressed from her and from her husband her true parentage, and it was not until after the death of Woodbridge and the performance of the contract on her part in all its details, that the widow disclosed the fact to her and her husband that she was not their child.

If the value of the services could be ascertained with reasonable accuracy in an action at law, and adequately. compensated by the recovery of damages, neither the services themselves or the payment of them will avail as a part-performance of the verbal agreement; but if the services are of such a peculiar character that it is impossible to estimate their value by any pecuniary standard, or if it is evident that the parties did not intend to measure them by any such standard, then the plaintiff, after the performance of such services, could not be compensated. Under such circumstances the rendition of the services or procuring th§m to be rendered, is a part-performance of the verbal agreement. And where a verbal agreement has been made, and one party has knowingly aided or permitted the other to go on and do acts in part-performance in full reliance upon such agreement, and which services are of such a nature that an adequate compensation for the loss by an action at law cannot be had, then it would be a fraud in the first party to interpose the statute of frauds as a bar to-the completion of the contract, and thus secure to himself the benefits of .acts already done in part-performance, while the other party would not only lose all advantages from the bargain, but would be left without a remedy for its failure. To preventSthe success of such fraud, equity interposes, and compels an entire completion of the contract by decreeing its specific performance. Pomeroy, Spec. Per., 355, Rhodes v. Rhodes, 3 Sand. Ch., 279; Davidson v. Davidson, 140, 13, N. J. Eq., 220; Brown on Frauds, 213; Vandine v. Vreeland, 12 N. J. Eq., 371; Smith v. Hogden, 62 Mo., 120; Hill v. Game, 1 Beaven, 541; Waterman on Spec. Per., 368.

The case of Wallace v. Rappale, 104 Ill., 229, cited by counsel for the defendant, is not in conflict with the cases heretofore referred to. In that ease the contract was made by the father of the illegitimate child and the mother, in which he agreed to take the child into his own family and support it, and. at his death give it a share of his property and estate. The case was decided upon the ground, first, that the proof was not sufficient to support the agreement; and second, that the consideration was illegal, so far as the unlawful cohabitation entered into it. An agreement in consideration,of future illicit cohabitation is void — and past cohabitation does not form an adequate consideration. It is further said in that case, that the putative father of an illegitimate child and his participant in such conjugal offense, cannot by arrangement between themselves thus deprive the injured wife and her lawful children of their rights of inheritance and bestow upon them, in whole or in part, the spurious offspring of their adulterous intercourse, and that a court of chancery will not lend its aid to carry out such a purpose.” But it will be seen upon examination of this case, that some of the cases to which we have heretofore referred as supporting the conclusion we have arrived at, were also considered with approval in that case, arid the doctrine recognized as reasonable and equitable, but not applicable to the case then under consideration.

Neither do we think the case of Howard v. Brower, 37 O. S., 402, or the case of Crabill v. Marsh, 28 O. S., 331, support the defendant’s claim. Both of these cases were actions for money only, to recover the value of services performed in pursuance of a contract for land. In the latter case the court say, “We are not called upon in. this case to determine under what circumstances equity will or will not decree specific performance of a parol agreement for the devise or conveyance of land; such is not the character of the case before us. The ground upon which courts of equity interfere in such cases is that of fraud.” Without further reference to authorities cited by defendant’s counsel, we are of opinion that the demurrer to this defense should be sustained.

2. It is averred in the third defense that the alleged contract was not intended to be, nor was it capable of being performed in one year, and therefore is within the statute of frauds. The time of performance depended upon the death of Woodbridge and his wife; it was agreed, that upon the death of both, all the estate and property at that time belonging to Wood-bridge should go to the plaintiff. It cannot be said that such contract is not capable of being performed in one year; it is hardly necessary to observe that they might have died at any time within the year, so that the contract might have been fully performed within that time, and which would have been in accordance with the stipulation of the parties.

If the executory promise be capable of entire performance within one year, it is not within this clause of the statute. The decision of this question does not seem to depend entirely upon the'understanding or intention of the parties. They .may have contemplated as probable a much longer continuance of the contract, and it may in itself be liable to such continance, and it may be so protracted that it is not in fact performed within a year; but if when made it was in reality capable of full performance within the year without the intervention of extraordinary circumstances, then it is to be considered as not within the statute. “ And where the time for the performance of the contract is made to depend upon some contingency which may or may not happen within one year, it is not within the statute.” 3 Parson’s Con., 35.

“ To bring a case within the statute of frauds, it must have been expressly stipulated by the parties, or it must upon a reasonable construction of their contract appear to have been understood by them, that the contract was not to be performed within a year.” Herrin v. Buttes, 20 Me., 119.

“ The statute applies to agreements which, fairly and reasonably interpreted, do not admit of a valid execution within one year. If an agreement may be performed entirely within the year, consistently with the understanding and rights of the parties, it is not within the statute.” Brown on Frauds, 273.

We, therefore, conclude that the contract, being such that it was capable of full performance within the year, or that it might have been performed within the year, was not within the statute, and that the demurrer to this defense should be sustained.

3. As to the question made by the demurrers to the fourth, fifth, sixth and eighth defenses which interpose the statute of limitations, it is enough to say that from the very nature of the claim made in this case, neither could be available. The claim is for equitable relief, and would properly come within sec. 4985 R. S. And furthermore, it appears that the plaintiff at the time the cause of action accrued was, and still is, a married woman, and therefore within the saving clause of the statute.

Cooper & Moore, and M. R. Dickey, and Criichfield & Graham, for plaintiff.

JBT. H. Greer and Dirlam '& Leyman, for defendant.

'4. The seventh defense sets forth in substance, that Lydia T. Woodbridge bequeathed to the plaintiff the use of a certain sum of money during her life, and that the plaintiff by accepting the payment of interest thereon has elected to accept such bequest, and is therefore estopped from asserting the claim made in this action. If the facts stated in the petition are true (and we must assume they are for the'purposes of this demurrer) then Lydia T. Woodbridge was not the owner of of the property or the fund bequeathed, and could not convey any title or interest therein.. The plaintiff’s claim is, that she is the owner of the whole estate and property from which this bequest was made, and that the part received by her was not taken as the property of 'the testatrix, but that it was absolutely her own. Besides, the reply to this defense denies some of the material allegations thereof. It is therefore manifest that the demurrer to this reply should have been overruled.

Judgment accordingly.

Follett, J., dissented.


author: Smith, J.

text:
    (First Circuit — Hamilton Co., O., Circuit Court
    September 22, 1885.)
    Befobe Judges Cox and Smith, .sitting in chambers during vacation.
    W. W. Johnson et al. v. The Village of Avondale and Benjamin Barton.
    Practice. — An interlocutory order by the judge of common pleas, dissolving an injunction, is not suspended by an appeal to the circuit court, unless such suspension is ordered by the circuit court, or two judges thereof, in vacation.
    Sewer. — Council of a village has a discretion in devising a plan of sewerage, which can not be interfered with by the court, unless grossly abused.
    Parties can not object to the building, of a sewer on their street on the ground that all the owners on it have already made sufficient private arrangements for carrying'off their sewage.
    The costs of sewers on several streets may be added together, and thus assessed equally on all the land adjacent to the several streets.— [Ed. Bulletin.]

      The petition in this case in the common pleas court was filed by parties residing on Gholson'A venue in the Village of Avondale, who asked for an order restraining the village! and its contractor from building a sewer on that avenue, on the ground : 1st, that the main sewer did not have an outlet in a proper place; 2nd,®that the plaintiffs were already provided with private drainage and therefore could not be assessed; 3d, that the system was defective and would create, a nuisance; 4th, that the clerk of the village had not certified that there was money in the village treasury sufficient to meet the expense of building this sewer; 5th, that the assessment would be unequally distributed among the ^various property holders on Gholson and other avenues.
    Upon the filing of the petition Judge Robertson granted a temporary restraining order, which the defendants moved at once to have dissolved. ' Upon this motion a full hearing of the case, was had, which resulted in an order by Judge Robertson dissolving the temporary restraining order, and from which interlocutory order the plaintiffs appealed, but failed to obtain two judges within the 10 days for which Judge Robertson had suspended his order. After the expiration of.that time, Judge Cox was applied to for an order suspending the order of dissolution below, but that judge was unwilling to decide whether or not two judges were required by law to make such an order. At his request the defendants consented to postpone the continuation of the|work, until Judge Smith could be obtained and the case could be heard before two judges. Upon the hearing of the case before Judges Cox and Smith it was held, that on appeal from such an interlocutory order dissolving an injunction,"made by the court of common pleas or a judge thereof, such interlocutory order, under the provisions of section 5226, as it now stands, is not suspended by such appeal unless it is so ordered by .the circuit court, or two judges thereof in vacation.
    The case was then fully argued by counsel on both sides to the two judges. On consideration, Judge Cox, while expressing no opinion as to the merits of the case, inclined to the opinion, that the injunction should be continued until the final hearing on appeal. Judge ^Smith held that a proper case was not made for the injunótion, and the following is his opinion:
   Smith, J.

The question presented to us, is, whether the interlocutory-order made by Judge Robertson, dissolving the temporary injunction before that time allowed in this case (and which order was appealed from to the circuit court), should be suspended by us. Or in other words, whether we ought now, on this preliminary hearing, enjoin the defendants from the fur-' ther construction, of the lateral sewer on Gholson Avenue, until the court, in regular session, can hear the matter so appealed on its merits.

We understand it to be considered, that an injunction may properly be granted if the village is proceeding, substantially, against the provisions of the statute, or if in a matter in which the council of the village has a discretion, it is grossly abusing it.

The first reason assigned by the counsel for the plaintiff, why the village authorities are proceeding illegally in the matter in question is,' that the main sewer in the district, and into which the Gholson Avenue lateral sewer is to empty, has, according to their claim, no proper outlet.

I understand .that under the 'plan of sewerage heretofore adopted by the village, the main sewer was to empty into the large ravine'at a point some distance north of the point where the Gholson Avenue sewer was to connect with it: and that under the action of the village authorities, it has since then been carried further north, and still further down the ravine and further from the property of the plaintiffs. That this ravine continues till it reaches Millcreek, and at times has a large quantity of water flowing down it — at times it has but very little, and on rare occasions perhaps no water running in it. It is objected, that on th-is account it is not a proper outlet for this main sewer; and for the additional reason, that the village authorities have no right to have the outlet there, as. it interferes with the private rights of the person who owns the land at that point.

Sec. 2370 of the Rev. Stat. provides, that the council may devise a plan for the sewerage of the corporation, consisting of one or more main or principal sewers, with the necessary branches and connections,: the main or principal sewers having their outlet in a river or other proper place; and my present opinion is, that the ravine in this case does in fact constitute an outlet to the main sewer. Whether it is a proper one, is, in my judgment, a matter as to which the law confers a discretion on the village authorities, and unless it has been grossly abused, the courts can not properly interfere. And I see no good reason as yet to think that such discretion has been abused. ■ The evidence on this point is, to say the least, very conflicting. Nor do I think the fact' that the right of the village to have the outlet at this point, is denied by the owner of the ground, is a good reason why the court should interfere as prayed for at the instance of the plaintiffs. They are not called upon to defend the rights of the owner. If the village infringes on them, he has his remedy; but if the fact that some person might have a claim against the village for flowing sewage upon, or near his lands, is to stop this work, it is probable that the sewer can never be built anywhere. The same claim might be made by the plaintiffs if it was continued and actually emptied into Mill Creek, or some other stream, for it might then be ap invasion of the rights of some one as much as it is now.

The fact as it is claimed to be, that all of th'e owners of land on Gholson Avenue, have already made private arrangements for carrying off the sewage from their premises, is, I think, no good reason why they can now prevent the construction of this lateral sewer, or be freed from an assessment for its construction, even if it be admitted as claimed, that there are now no other persons than plaintiffs who will be benefited by it. If such a construction is to be put upon the law, it would practically put an end to any general system of sewerage in a municipal corporation, to be paid for by assessments on the adjacent property, and all that a land owner in that event need say is, that he has made other arrangements satisfactory to himself, and thus prevent any assessment upon him. This will not do. The statute, section 2385, which it is claimed justifies this, is intended in my judgment to meet a case where the person has already, by steps taken by the mix nicipal corporation, and to the construction of which his land has contributed, been entirely, or in part, supplied with sewerage.

It is again urged that owing to the fact that the %ater supply in Avondale is now very limited, and not sufficient to force the sewage through the sewers to the outlet, that the foecal matter will settle in them, and that the gas generated therefrom will escape through the main holes, and operate as a nuisance to the plaintiffs and others.

That this result will follow, I think, can not be said to be at all certain. Indeed there is much doubt whether such will be the case, even if there be nothing done hereafter by the village authorities to prevent it, which is not to be presumed. It may well be, that in the near future some efficient water supply may be provided, which would enable to flush the sewers, and thus prevent any evils which are suggested as likely to ensue. At all events the danger is not so imminent as in my judgment to require the extraordinary remedy.

Another objection which is urged is, if I understand it right, that the cost of the sewer on Gholson Avenue, and of those on two other avenues, is to be ascertained and added together, and then assessed on the land adjacent to the three avenues, when the cost of the sewer on Rockland Avenue, one of the three, will be much greater than the cost of the one on Gholson Avenue, and that this will be unjust and contrary to law.

•I have not had time carefully to examine the statute, but it seems to' me that there is reason to think that this mode of proceedure is authorized by Sec. 2381; that is the cost of one or more lateral sewers, may be assessed upon the lands in the district through which the main sewer passes, in either of the modes pointed out in the section. At all events no illegal assessment has yet been made, and the plaintiffs can not complain..

I have not had the opportunity to examine these questions with the care I should like to, and would do were they presented on a final hearing of the case. 1 simply express my present opinions, and hold myself ready to arrive at a different conclusion hereafter, should I see reason to. do so. I am the more free'to arrive at the conclusions announced, for the reason that I do not see how the plaintiffs will be prejudiced by the refusal to enjoin the work, except as general tax-payers, unless it be in the one matter of the nuisance, if it should turn out to De such; for so far as the assessment against them is concerned, if the action of the council is found to be fatally wrong, they could be fully protected by a future decree of the court. I think, therefore, that the injunction ought not to be-continued.

Paxton & Warrington and Wood & Boyd, for plaintiffs.

C. B. Matthews and Strickland & Lehmer, contra.


author: Moore, J.

text:
    (Third Circuit — Allen County, O., Circuit Court
    December Term, 1885.)
    Befóse Judges Moose, Bees and Senev.
    F. A. Wheeler v. Laura Crouse, Executrix of Mary A. Crouse.
    Where a tenant for one or more years holds over after the expiration of his term, the landlord has the option to treat him as a trespasser or a tenant for another year upon the terms of the prior lease.
    Such holding over however is not conclusive, but only prima facie, and may be rebutted. •
    If the tenant in such case under his contract notifies his landlord that he-will hold over on condition that certain improvements and repairs be-made to the premises, which the landlord refuses to make, and is then notified by the tenant that he will continue in the possession of the premises only until such time as he can secure other premises-suitable for his business, ^.nd pays one month’s rent in advance, and' no objection is made at the time on the part of the landlord, such ' tenant is liable only to pay rent for the time he occupies the premises.
    Error to the Courtf of Common Pleas of Allen County.
   Moore, J.

Suit was brought by defendant in error against F. A. Wheeler to recover for one month’s rent for store-room in city of Lima.

The court below made a finding of facts, ahd. upon such finding rendered judgment for plaintiff below for the amount claimed. •

To reverse the judgment so rendered this proceeding in error is prosecuted.

The facts so found are—

That the parties, plaintiff and defendant, entered into the-written contract set out in and attached to the answer of defendant, Wheeler, and defendant Wheeler was in the possession of the premises therein described, as the tenant of plaintiff under said contract on the 16th day of October, 1883.

On the day last named defendant Wheeler gave plaintiff written notice that he desired to use and occupy the premises under the contract for another and second year, but would do so only on condition that certain repairs and betterments were made'to the property by plaintiff. The plaintiff on ascertaining what repairs and betterments were desired and demanded by Wheeler, positively refused to make any, and none were, in fact, made. Defendant Wheeler was informed of the plaintiff’s refusal to make any repairs or betterments to the property, and at once notified the plaintiff through her agent that he would not retain and occupy the premises for another and second year, but would only occupy them until such time as he could get another business room in which to do business. No response was made by plaintiff to Wheeler as to this-notice. All these notices and negotiations were had and given between the parties during the month of October, 1883, and before the expiration of the first year under the contract, and no other or further negotiations were had between the parties.

The defendant, Wheeler, continued to occupy the premises up to and ‘including April 16, 1884, and on that day he vacated the premises and ceased to occupy them further, and tendered the keys and possession to plaintiff, which the plaintiff refused to accept, and for the first time gave the defendant express notice that she regarded him ás a tenant for a second year under the contract, and would look to him for the rents for the remainder of the year. At the time the said notices were given that the premises would not be occupied unless the repairs were made, and also when defendant notified the plaintiff’s agent that he would not retain the premises for a seoond.year, but only till he could get another place, he paid to plaintiff $56.25, being equal in amount as paid per month under the contract which was accepted by plaintiff, and such payments were continued to be made monthly in advance until March 17, which paid the rent until the time the defendant Wheeler vacated the premises.

The contract referred to in the finding by the court provides “ that the lease shall be for one year with the refusal from year to year and to exceed three years at same rent as first year, and-should party of second part wish the benefit of such refusal, he, the party of the second part, agrees to give said party of the first part at least thirty days notice in writing of such desire prior to the expiration of this lease, otherwise said party of the first part shall have the right to lease said business building and cellar at the end of the first year without notice to party of second part.”

This lease shall commence on Nov. 17, 1882, and expire on the 17th day of Nov., 1883, unless renewed as aforesaid.

Upon this finding of facts the court below found as a conclusion of law : That the defendant, Wheeler, was the tenant of the plaintiff for another and second year, and liable to pay rent for the whole of such year, and rendered judgment accordingly.

The general principle is well recognized that where a tenant holds over after the expiration of his term, the law will imply an agreement to hold for a year upon the terms of the prior lease.

It is claimed that this presumption or implication is conclusive, or if not, the facts found by the court below do not overcome or rebut such presumption, or implication. We are cited to the case of Schuyler v. Smith, 51 N. Y., 309, to sustain the doctrine. In that case the tenant gave notice before expiration of his lease, that he would not occupy the premises, but did occupy after expiration of term for three weeks. And the court held the landlord could either treat the tenant as a tress-passer or a tenant holding over for the year. That case may be distinguished from the case at bar in this. In the case at bar the facts show that the tenant notified the landlord that he would continue only upon the condition that certain repairs would be made. This was positively refused. The tenant then notified the landlord that he would not continue to hold under the contract, but would hold for such time until he could get another place suitable for his business, and pai'd rent for one month.

Ferrall & Ohlen and Pillars, for plaintiffs in error.

J. F. Brotherlon, for defendant in error.

In the case cited the only notice given was by the tenant that he would quit, and without further notice or negotiations he continued to hold over. And while the law laid down in the case may be correct, it does not reach the questions made in the case at bar.

In this case the plaintiff was informed that the defendant, Wheeler, would not continue under the former lease, but that he would remain in occupation of the premises until he could get another suitable building, and with such information and knowledge he accepted, without dissent, the month’s rent. This clearly rebuts the implication arising from holding over and that such tenancy is for a year.

In Atlantic National Bank v. Demmon, Supreme Court of Massachusetts, the court held: “A tenant may show that such holding over and payment of rent are not conclusive;” and say that the holding accompanied with the payment of rent is a piece of evidence sufficient of itself, if unexplained and uncontrolled, to raise a fair inference and presumption that the option has been exercised.' and thus to make out a prima facie case. And this is the most that can be said of it, and it is still competent for the tenant to offer opposing evidence. Such evidence contradicts no terms of the lease. It simply shows that the option secured to the tenant has not been exercised.”

The same doctrine is laid down in Woods’ Landlord and Ten-mt, and supported by numerous authorities.

Our own Supreme Court has not furnished us with any authority.

We, therefore, are of the opinion that the court below erred in its application of the law to the facts found, and that the judgment below should have been for the defendant.

The judgment will be reversed, and the court, proceeding to render the judgment that the court below should have rendered, will enter judgment for the defendants below upon the facts found.


author: Williams, C. J.

text:
    (First Circuit — Hamilton Co., O., Circuit Court
    November Term, 1885.)
    Before Williams, C. J., and Judges Smith and Swing. (Chief Justice Williams taking the place of Judge Cox.)
    Martin Tedtman v. Levi B. Hancock.
    To say to, and of another in a public discourse spoken in the presence and hearing of others: “You area fraud. You do not pay your debts. You are a thief and a fraud,” is prima facie actionable slander.
    Error to the Court of Common Pleas of Hamilton County,
   Williams, C. J.

The action below was for slander. Tedtman was plaintiff and Hancock defendant. The amended petition was in the usual form; the slanderous words which it is therein averred were spoken by the defendant of and concerning the plaintiff being: “You (meaning the plaintiff) are a fraud. You do not pay your debts. You are a thief and a fraud.”

The court below sustained a demurrer to this petition, and no further leave to amend being asked, gave judgment for the defendant. This is the error assigned in this court.

It is claimed in behalf of the defendant in error, that although to call a man a “ thief,” is per se actionable; yet if it-appear, taking the whole discourse together and the circumstances under which it was spoken, that the words were not intended to impute a crime, and were not so understood by the hearers, they are not actionable.

This is substantially the rule of Brown v. Myers, 40 Ohio St., 99.

A “ thief” is defined by Bouvier to be “ one who has been guilty of larceny.”

Simply to call a man a “ thief” is prima facie actionable, as-it imputes felony. Where the word “thief” is used, the law will presume the intent to impute a crime, unless the contrary intent, is shown. Addison on Torts, 956.

Where such contrary intent does not appear on the face of the petition, it is not demurrable; but it. becomes a question of fact for the jury under proper defense, whether from the accompanying language and surrounding circumstances, the defendant did intend to impute actual theft, or with what meaning the words were spoken and understood; and if it so appear that the words were used as mere terms of abuse and not as an imputation of a crime, there is no cause of action.

Nat G. McLean, for plaintiff in error.

Archer & McNeil, for defendant in error.

In the amended petition in this case the words: “Your are a thief and a fraud,” constitute an independent sentence. The contexPdoes not give to the word “ thief” any other than its usual meaning. The sentence quoted is not limited or qualified in its meaning by the preceeding ones, so as to make it equivalent to, “ you are a thief and a fraud because you do not pay your debts.” It does not therefore appear on the face of the petition that the word “ thief” was used in any other than its ordinary sense of imputing the crime of larceny. The petition stated a good cause of action, and it follows the Court of Common Pleas erred in sustaining the demurrer. The judgment of the Common Pleas is reversed and the cause remanded, with instructions to overrule the demurrer, and for further proceedings according to law.