author: POLLOCK, J.

text:
    CORPORATIONS — EQUITY.
    [Richland (5th) Court of Appeals,
    January Term, 1916.]
    Houck, Pollock and Spence, JJ.
    (Judges Pollock and Spence of the 8th Appeals sitting in place of Judges Shields and Powell.)

      Joseph E. Smitt v. Aultman & Taylor Co. and Aultman & Taylor Mach. Co.
    1. Relation of Employe to Employing Corporation in Which He Has Purchased Stock.
    A .fiduciary relation is' created where an employe, having great confidence in the integrity and ability of the officers of a corporation for whom he has keen employed for many years, purchases stock from the corporation at the solicitation of such officers in a new corporation organized by such officers for the purpose of purchasing the property of the old corporation and continuing its business under the same corporate control, and gives his note, secured by such stock, in which it is recited that the dividends of the new company shall be applied to its payment; if the confidence so reposed is abused the company would be liable, however no liability would arise for losses growing out of changes in business conditions or from mistakes in judgment on the part of those in control.
    2. Equity, without Fraud Shown, Cannot Order Corporation Dividends.
    A court of equity is without power, in the absence of fraud or abuse of discretion, to require a board of directors to declare dividends, and it follows ttíat no authority exists for declaring paid a note given by an employe for stock, which note was to have been satisfied by application of dividends on the stock but was not so paid because of failure to declare dividends.

      3. Oral Evidence in Explanation of a Written Contract Inadmissible.
    The rule which, permits the giving of oral testimony in explana- ■ tion of the circumstances surrounding the making of a written contract, does not authorize the varying of the plain terms of the written contract by such oral testimony, unless it be shown that the contract was made through mistake, fraud, surprise or accident; hence, since the plaintiff is not claiming fraud, or asking that the contract be set aside, but rather that it be enforced in his favor, such oral testimony is inadmissible.
    ERROR.

      Brucker, Voegele <& Henkel, for plaintiff in error.

      McBride & Wolfe, Harter & Harter and Pomerene, Ambler & Pomerene, for defendant in error.

       Affirmed, no op., Smith v. Aultman & Taylor Co., 94 O. S. 000; 61 Bull. Supp. 406.

   POLLOCK, J.

This ease comes into this court on appeal, and was submitted on the pleadings, the evidence and the argument of counsel.

The plaintiff seeks to have the defendant, the Aultman & Taylor Company, cancel and surrender a note given by him to it for $5,000, and a retransfer of fifty shares of the capital stock of the Aultman & Taylor Machinery Company deposited as collateral security.

The pleadings are long, and I will not attempt to state, only in very general terms, the allegations made therein. Plaintiff says that the Aultman & Taylor Company was organized in 1867 for the purpose of manufacturing threshers and threshing engines; that it continued in business to 1891; that its business was very profitable; that in 1891 those holding the majority of stock in that company desired to quit the active business in which it was engaged, and that they organized the Aultman & Taylor Machinery Company, with a capital stock of $500,000, subscribing for and receiving all of the capital stock of that company; that the Aultman & Taylor Company sold to the Ault-man & Taylor Machinery Company all of its property except its notes and accounts receivable; that plaintiff was an employe of the Aultman & Taylor Company at the time of the organization of the later company, and had been for many years prior to that time, and that, by representations of the Aultman & Taylor Company, he was induced to purchase from that company fifty shares of the capital stock of the Aultman & Taylor Machinery Company, giving in payment therefor his note for $5,000 and depositing the stock as collateral security, with a condition in the note that he was to apply all dividends declared on this stock to the payment of his note.

He further alleges that the Aultman & Taylor Company has always owned a majority of the capital stock of the Aultman & Taylor Machinery Company, and that it has controlled the eleetion\ of directors of that company and its management; that in fraud of plaintiff’s rights it has refused to permit dividends to be declared on the capital stock of the Aultman & Taylor Machinery Company, and in fraud of plaintiff’s rights it has engaged in other business not contemplated at the time plaintiff purchased his stock.

He further alleges that the earnings of the Aultman & Taylor Machinery Company have been very large, setting out the earnings as shown by the statement of that company 'each year, and alleging that the Aultman & Taylor Company has prevented dividends to be declared by the Aultman & Taylor Machinery Company.

He prays that the Aultman & Taylor Machinery Company be compelled to declare dividends of all its earnings, as of the date when the same should have been declared, and that all the earnings of the company, or enough to pay the same, be applied upon the note of the plaintiff now held by the Aultman & Taylor Company, and that said note be canceled and held for naught, and that the Aultman & Taylor Company be compelled to immediately surrender to plaintiff the stock held by it as collateral, and for other and proper relief.

The two defendants filed separate answers which admit the organization of both companies, and many of the allegations of the petition, but deny all allegations of fraud or fraudulent practice, and deny plaintiff’s right to have said note canceled and the stock surrendered; and the Aultman & Taylor Company, as a cross-petition, asks for a judgment on the note and an order to sell the stock held by defendant as collateral security. The plaintiff, in his brief, says that he is not insisting upon any relief or order directed against the Aultman & Taylor Machinery Company.

The note, which the plaintiff asks to be canceled and the stock deposited as collateral security therefor surrendered to him, reads as follows:

“MaNsfield, Ohio, .
“No. $5,000. October 1st, 1891.
! ‘ On or before October 1st, 1906, the undersigned promises to pay to the Aultman & Taylor Company or order five thousand ($5,000) dollars for value received, with interest at 6 per cent, payable annually, and has deposited with the Aultman & Taylor Company as collateral security ' shares of stock in the Aultman & Taylor Machinery Company of Mansfield, Ohio, with authority to sell the same at public or private sale, at its option, on the non-performance of this promise and without notice, applying the net proceeds to the payment of this note, including interest, and accounting to the undersigned for the surplus, if any. In case of deficiency the undersigned promises to pay to the Aultman & Taylor ■ Company the amount thereof, forthwith after such sale, with legal interest. The Aultman & Taylor Company agrees not to sell the stock above described before October 1st, 1906, and the undersigned agrees to apply all dividends paid by the Aultman & Taylor Machinery Company to the payment of the principal and interest of this note as fast as such dividends are declared. The undersigned agrees that with such dividends (supplemented if necessary by cash payments) the principal of this note shall be paid off, beginning October 1, 1896, at the rate of not less than 10 per cent, each year.
“Joseph E. Smitt.”

The plaintiff in the trial of this ease seems to abandon his right, as stated in the prayer of the petition, to have dividends declared by the Aultman & Taylor Machinery Company, as of the date that he claims the earnings were made and applied to this note, but claims, first, that the contract as intended by the parties was that all the earnings of the Aultman & Taylor Machinery Company were to be credited upon this note from time to time as they were made by the Aultman & Taylor Machinery Company, whether these earnings had been declared as dividends or not; and, further, that, as1 the Aultman & Taylor Machinery Company, soon after its organization went 'into the manufacture of what is denominated “the large boiler business” and continued for a number of years in this business, which they claim was not contemplated at the time of the giving of this note, or rather that the Aultman & Taylor Company had promised and agreed that the Aultman & Taylor Machinery Company would only engage in the business that had formerly been engaged in by the Aultman & Taylor Company, that the-engaging in this boiler business was a constructive fraud on this plaintiff and, as there -were large losses made, the Aultman & Taylor Company should be required to bear plaintiff’s proportion of that loss and that that proportion should be credited on the note for the reason that the Aultman & Taylor Company dictated the policy of the Aultman & Taylor Machinery Company by electing its directors.

On the trial of this case the plaintiff introduced the testimony of himself and, in order to substantiate these claims, he testified to conversations with M. D. .Harter, who represented,, in the sale of this stock to plaintiff, the Aultman & Taylor Company. This testimony was to the effect that during the conversation of plaintiff with Harter in regard to the subscription for this stock, plaintiff was assured by Harter that the Aultman & Taylor Machinery Company would not engage in any other business except that which had been conducted by the Aultman & Taylor Company, and also that the earnings of the Aultman & Taylor Machinery Company would be declared in dividends and applied on the plaintiff’s note, and that plaintiff would not be called upon to pay any of the principal and interest of this note. This testimony was objected to by the defendant and taken under objection.

The claim of the plaintiff is that this testimony is competent under the rule that written contracts may always be read in the light of surrounding circumstances. Masters v. Freeman, 17 Ohio St. 323. This is a rule of universal application in the construction of written contracts, but the rule that oral testimony is not admissible to contradict or vary the terms of a written instrument is equally as well supported. Thompson, Ohio Trial Evidence, Sec. 405. The sections following and the cases cited thereunder will illustrate the first rule as to when oral testimony can be given in explanation of the circumstances-surrounding the making of a written contract. But this does-not authorize the varying of the plain terms of a written contract by oral testimony. This author, of course, refers generally to actions at law, but we think there is no variance from the-, rule in actions in equity, exe,ept where the contract is induced to be made through mistake, fraud, surprise or accident. Pomeroy’s Equity Jurisprudence, Sec. 858. ,

In the present ease it is not claimed that there was any mistake or fraudulent representations made by the Aultman & Taylor Company to induce plaintiff to enter into this contract, but all the representations were made in good faith. And the-plaintiff is now not asking that the contract be set aside, but he is asking that it be enforced in his favor. We do not see how,, under these rules, any statements that were made by the representative of the Aultman & Taylor Company, at and before the-making of the contract, which tend to vary its terms, can be-proven by oral testimony. For this reason we think that the exceptions to all the oral testimony as to the statements made-by Mr. Harter at and prior to the time of the making of the-contract should be excluded.

The plaintiff further claims tha„, by reason of his being in the employment of the Aultman & Taylor Company for many years before the organization of the other company, and his confidence in the business ability and management of those having control of the Aultman & Taylor Company, and the success of that company, a fiduciary relation existed between himself and the Aultman & Taylor Company in entering into this contract for the purchase of the stock of the Aultman & Taylor Machinery Company.

A fiduciary relation exists between parties when one party is; placed in charge of the person or property, or both, of another, through legal proceedings; and it may exist between parties in a contractual relation where one party, with the knowledge of the other, places confidence and trust in the honesty and judgment, or both, of the other, and this is known to the other party by reason of - some former relationship or dealings that give the one tbe right to rely upon the other. This rule is very aptly stated in Pomeroy’s Equity Jurisprudence, Sec. 956:

“■Wherever two persons stand in such relation that, while it continues, confidence is necessarily reposed by one, and the influence which naturally grows out of that confidence is possessed by the other, and this confidence is abused, or the influence is exerted to obtain an advantage at the expense of the confiding party, the person so availing himself of his position will not be permitted to retain the advantage, although the transaction could not have been impeached if no such confidential relation had existed.”

And the Supreme Court of this state has announced this principle, as follows:

“1. The principle that a party is responsible for false representations of material facts, applies to all those cases where influence is acquired and abused, or confidence is reposed and betrayed.” Smith v. Patterson, 33 Ohio St. 70.

We think that this relation did exist, under the principles just referred to, between the plaintiff in this case and the Ault-man & Taylor Company in the entering into this contract for the purchase of the stock, and also in the carrying out of the contract for the payment of the note given for the purchase money. Mr. Smitt relied upon the good faith and the business judgment of those in charge of the Aultman & Taylor Company in tbe management of the Aultman & Taylor Machinery Company in order to pay his obligation to the first company, and if this confidence was abused or intentionally taken advantage of, the company would be liable to the plaintiff in some way therefor. But the rule does not require that the Aultman & Taylor Company should be held responsible, either in equity or in law, for mistakes in the management of the Aultman & Taylor Machinery Company by which loss was incurred, unless they intentionally abused this trust and confidence.

The testimony shows that shortly after the organization of the Aultman & Taylor Machinery Company, the board of directors of that company went into what is denominated in the trial of this case “the construction of large boilers.” While this business at first seems to have been profitable, yet from that on it is admitted that the business was not nrofitable and was finally disposed of at a loss. It is admitted that this business was not contemplated at the organization of the Aultman & Taylor Machinery Company, b»t it was within the provisions of the charter of that company.

Now, the plaintiff insists that the Aultman & Taylor Company should be required to credit on his note his proportionate am'ount of that loss, for the reason that it held a controlling amount of the stock and that it cast its vote at the election of directors of the Aultman & Taylor Machinery Company for the directors that were elected, and that they were under the control and management of this company.

There is no testimony tending to show that the Aultman & Taylor Company, either in the respect complained of or in any other respect, acted in bad faith in the management of the-Aultman & Taylor Machinery Company. There is no complaint that the board of directors elected were not competent and honest, and there is no testimony tending to show that those in charge of the Aultman & Taylor Company or the directors of the Aultman & Taylor Machinery Company, when the latter company engaged in the boiler business,.had any other motive than that of the best interests of that company. They believed that the business in which they then embarked would prove-profitable and advantageous to their company, and this belief was acquiesced in by the Aultman & Taylor Company, and there is no evidence tending to show but what both exercised their best judgment in this matter, and they are not chargeable with any loss that afterwards occurred.

The plaintiff trusted to their judgment and skill, and he-received what he trusted in, and the Aultman & Taylor Company are not responsible for any loss that occurred by reason of ' this misjudgment, if it was such, but the loss is perhaps better attributed to a change of business conditions.

It is further urged that the true intent and meaning of the note or contract signed by the plaintiff, providing for the applying of dividends declared on the stock of the Aultman & Taylor Machinery Company to the payment of the note, was that whenever any earnings were made by the Aultman & Taylor Machinery Company the proportionate part should be applied to-the discharge of this obligation, regardless of the fact that no dividends -were declared, and if tbe amount had been applied each year, as the company’s statements show the earnings were made, it would have paid the mote prior to this, and for that .reason the defendant should be required to surrender it.

It is urged that this construction was placed upon this contract or note by the Aultman & Taylor Company at its meeting in January of 1898. At that meeting there was a resolution passed by the Aultman & Taylor stockholders reciting that the ■earnings of the Aultman & Taylor Machinery Company had not come up to the hope and expectation of the Aultman & Taylor Company, and this company made the offer then to plaintiff, and •others, who held stock under similar contracts to surrender their •stock to this company and they would surrender the noté and cancel the contract. It is claimed that by reason of the Aultman & Taylor Company in this resolution using the word “earnings,” that this contract or note should be construed to mean “earnings” in place of “dividends.”

Dividends are declared by a corporation from its earnings. "When the earnings did not reach the hope and expectation of the Aultman & Taylor Company, no dividends could be declared thereon. The company, in making its offer to cancel the contract between the plaintiff and it, used the word “earnings,” but this resolution in no way tended to place a different construction upon this contract or note than is gathered from its plain reading.

The contract entered into between the. plaintiff and the Ault-man & Taylor Company, in regard to how this note should be paid, is too plain to apply all dividends paid by the Aultman & Taylor Machinery Company to the payment of principal and interest of this note as fast as such dividends are declared. This is the plain provision of this contract, and equity does not permit courts to make other or change plain provisions of a contract.

Our attention has been called to the maxim: ‘ ‘ Equity considers that done which ought to be done.”

If payment of this note had actually been received by the Aultman & Taylor Company, equity would apply that maxim and cancel the note without inquiring whether it was received ¡through dividends or other provisions of this note or not.

But there is another maxim of equal importance, that, “He who seeks equity must do equity. ’ ’

“The meaning is, that whatever be the nature of the controversy between two definite parties, and whatever be the nature of the remedy demanded, the court will not confer its equitable relief upon the party seeking its interposition and aid, unless he has acknowledged and conceded, or will admit and provide for, all the equitable rights, claims, and demands justly belonging to the adversary party, and growing out of or necessarily involved in the subject-matter of the controversy.” .Pomeroy’s Equity Jurisprudence, Sec. 385.

The plaintiff can not demand the surrender of this note in equity from the Aultman & Taylor Company, until he has paid the consideration as provided by that note, of in some other manner which is its equivalent. There is no claim that the note has been paid, or anything paid thereon except the dividends of eight and six per cent., made in the first years of the Ault-man & Taylor Machinery Company’s existence. While the earnings of this company and very large at present time, yet from the testimony as to their manner of doing business it would be disastrous to the credit of the Aultman & Taylor Machinery Company to require it to declare a dividend from its earnings at the present time.

There can be no question about the rule that a court of equity has no right to require the directors of a corporation to declare dividends in the absence of fraud or abuse of discretion upon the part of the board of directors. Cook, Stock and Stockholders, Sec. 545. In fact, the plaintiff does not claim the right to require the Aultman & Taylor Machinery Company to declare a dividend at this time. In the absence of that right we feel that the court of equity has no power to declare the note canceled and the surrender of the collateral security.

The Aultman & Taylor Company are asking for an order directing the sale of plaintiff’s stock held as collateral security. The conditions under which this stock was deposited have been broken, and the defendant company has a right to have such an order.

As the Aultman & Taylor Company, in its brief, authorizes the court to mould its judgment in such a way that no judgment for a personal liability in its favor against the plaintiff may be had, the judgment may be that the defendant, the Aultman & Taylor Company, may have a finding against the plaintiff for the amount due upon its note, and an order of sale of the stock deposited as collateral security, but no personal judgment against the plaintiff for the remainder, if any, unpaid of the amount of the note after the application of the selling price of the stock.

The costs made in the court of common pleas will be adjudged against the defendant, the Aultman & Taylor Company. Those made in this court will be adjudged against the plaintiff. Exceptions noted for plaintiff. If plaintiff files a motion for a. new trial, it is overruled, and exceptions noted.

Houck and Spence, JJ., concur.


source: Caselaw Access Project

author: JONES (E. H.), J. GORMAN, J.,

license: Public Domain

text:
    CONTRACTS — EXECUTORS AND ADMINISTRATORS.
    [Hamilton (1st) Court of Appeals,
    June 12, 1916.]
    Jones, Jones and Gorman, JJ.

      Patrick Leen, Admr. v. Jane Leen.
    1. Compulsory Statutory Silence Imposed on Plaintiff in Action against Estate of Decedent for Services not Inference that Payments were in Full.
    In an action against the estate of a decedent for services rendered, the compulsory silence of the plaintiff touching the defense that payments made to plaintiff by the decedent were payments in full, creates no inference that plaintiff agreed to accept the payments made as payments in full, or that no agreement was entered into between them as to further sums being due in view of the greatly increased amount of work which had been thrown upon her, and in the absence of any word or circumstance to the contrary, estoppel does not operate against a further demand in settlement.
    2. Widow of Nephew of Decedent not Member of Household May Recover for Services Rendered Decedent.
    The rule laid down in Hinkle v. Sage, 67 Ohio St. 256, requiring that such a claim be supported by an express contract, has no application where the plaintiff is the widow of a nephew of the decedent and did not belong to the same household.

      Anthony B. Dunlap, for plaintiff in error.

      David Davis and Conway, Mueller <& Conway, for defendant in error.

      Motion to certify overruled by the Supreme Court November 21, 1916, Leen v. Leen, 61 Bull. 370.

   JONES (E. H.), J.

The defendant in error, Jane Leen, brought her action in. the common pleas court against Patrick Leen, as administrator of the estate of Maurice H. Leen, deceased, seeking to recover compensation at the rate of $24 per week for services rendered to the decedent, Maurice H. Leen. In her itemized statement she charges $20 per week for nursing and care, and $4 per week for looking after the business interests of the decedent, viz., in paying taxes, insuring the property, looking after repairs, paying bills, banking money, etc.

An answer was filed in the court below denying the allegations of the petition, and thereupon the cause came on for trial béfore the court and jury, which resulted in a verdict and judgment for the plaintiff below in the sum of $1,613.02.

We are asked to reverse this judgment on the grounds, first, that it is not supported by sufficient evidence, and, second, because the court erred in its charge to the jury.

After carefully considering these assignments of error, the majority of the court are of the opinion that neither of them is sustained by the record. It .appears that' the charge of the court was a full and fair exposition of the law as touching the issues made by the pleadings.

. The complaint of the plaintiff in error that the verdict of the jury is not sustained by sufficient evidence is based upon the claim that the evidence shows that Mrs. Leen, for several years prior to the death of the intestate and up to a time within a year or so of his death, had been rendering him services in cooking, cleaning and to a limited extent nursing for him, at the rate of $3 per week. The homes of the parties involved were near each other, being separated by only one narrow lot During the period of time just referred to, Mrs. Leen remained at home for the most part and looked after her own household. She discontinued this work for Mr. Leen for a period of several weeks, whereupon he came over to her house and told her that he could not get along without her assistance, and asked her if she would, not again help him. To this she assented, but from this time on the evidence shows her work was much more arduous and exacting, requiring a. great deal more of her time. Mr. Leen became very much afflicted and suffered the amputation of one of his legs, by reason of which she was compelled to remain with him in his house almost continuously, day and night. There is also evidence tending to show that she performed the services in connection with his business affairs, upon which she, in her petition; places the value of $4 per week. She received during this time the sum of $3 per week. There is no evidence, however, to shotv that this was paid to her in full for her services. The malady from which Mr. Leen -was suffering was progressive; his condition was constantly becoming worse, and it is only fair to presume in explanation of the lack of definite understanding as to compensation that the work was becoming more and more irksome, and thus more valuable; and, also, that Mr. Leen was in no condition physically to talk with .her over business matters, especially matters pertaining to his own personal care and comfort.

The action being one against the. executor of a deceased person, Mrs. Leen, the plaintiff, ivas by statute disqualified as a witness, so there can he no inference that nothing was said between her and her patient, Mr. Leen, during his long illness about the inadequacy of the compensation he was paying her. She may have protested and remonstrated with him every time he handed her the pittance of $3 a week, and unless it occurred in the presence of a third party competent to testify, she is helpless to prove such conversations. Or, it may be that it was distinctly agreed between the parties that the sum paid to her was only on account, and represented only a part of what she was actually to receive. It seems, therefore, that any conclusion reached in this ease based upon the theory that she never objected to the $3 per week or complained as to the inadequacy thereof, or any conclusion that the mere fact that weekly payments were made shows that such payments were in full, or that by receiving these weekly payments regularly she is now estopped, can only be based upon her compulsory silence, and is unsupported by any word or circumstance appearing in the ■record.

In view of the dissenting opinion which follows, we must add that in our opinion the rule laid down in the ease of Hinkle v. Sage, 67 O. S., 256 [69 N. E. 999], relating to claims for services to a deceased person by a relative or member of his household, can not apply here. Prior to her employment with Mr. Leen, the plaintiff had never lived in the house with him, nor did she so live after her employment. There was no blood relationship between the parties, and the only relationship that existed at this time was that Mrs. Leen was the widow of a deceased nephew of Maurice H. Leen. Neither the ease above referred to nor any of the other numerous eases in which the same principle is discussed has aught to do with any condition or family relationship such as has been shown to have existed between these parties. We know of no case in Ohio, or for that matter in any other state, where it has been held that one not related to a person by blood and not in any sense a member of his family or household, is barred from recovering for services rendered unless an express contract is shown. That the rule laid down in Hinkle v. Sage and later cases is a wholesome one will not be denied. Neither can it be denied that this rule has no application whatever to the facts in this ease.

In view of the evidence in the record as to the labors and responsibilities which rested upon Mrs. Leen, there certainly can be no presumption that the $3 was paid to her in full for all her services, and there was a lack of direct evidence to show that such was the case.

The jury was therefore justified under the evidence in awarding her compensation in addition to the $3 per week, and the amount was a matter entirely within the province of the jury and for its determination. In the absence of any indication of passion or prejudice, the jury having been made fully acquainted with the nature of the services 'which she rendered, the judgment will be affirmed.

Jones (0. B.), J., concurs.

GORMAN, J.,

dissenting.

The evidence in this case discloses that during the entire time that the plaintiff rendered the services to the defendant’s intestate she was paid each week the sum of $3 and received the same as her compensation for the services rendered. She made no complaint or objection to the amount paid her. She never notified or apprised the decedent that she was dissatisfied 02 expected to be paid more for her services. For a long time prior to her last employment she was also paid the sum of $3 per week. Under these circumstances it appears to me that she is now estopped from claiming that her services are worth more than $3 per week. “He who will not speak when he should, should not be heard to speak when he Avould. ’ ’ The decedent’s mouth is closed in death, and it appears to me that the acceptance of the amount paid her each week estops her from claiming 1hat she was entitled to more, after the death of Mr. Leen.

The cupidity and avarice of relatives of deceased persons so frequently tempt them to make claims against their estates, especially when they are dissatisfied with some provision made for them by the deceased, that the courts should frown upon all efforts to raid the estates of deceased persons.

I am fully convinced that the plaintiff in this case had no intention to make a charge of more than $3 per week for her services until after the death of Mr. Leen and that this claim upon her part was an afterthought. It appears to me that the verdict was manifestly against the weight of the evidence and that the defendant proved conclusively that the services rendered by the plaintiff to the decedent were fully paid for during the lifetime of the decedent.

For these reasons I am constrained to say that the judgment should be reversed.


author: JONES (E. H.), J. Gorman, J.,

text:
    WILLS.
    [Hamilton (1st) Court of Appeals,
    February, 1917.]
    Jones, Jones and Gorman, JJ.
    Henry Niemes et al. v. Tillie Niemes et al.
    1. The Words, “Misrepresentation,” “Deception,” “Coercion,” “Threats” in Instructions Held Prejudicial in Will Contest.
    The use- of such words as “misrepresentation,” “deception,” “coercion,” “threats,” in instructions to the jury in a proceeding to contest a will, is prejudicial, in the absence of evidence upon which the use of such words might fairly be inferred.
    .2. Porters, Janitors, Waiters, incompetent Witnesses to Show Mental Disability of Deceased Employer to Make Will.
    While the testimony of a family physician as to the ability of testator to understand and decide large and complicated business propositions is competent in a will contest proceeding, the rule is otherwise as to like evidence by lay witnesses such as porters, janitors and waiters, employees about his place of business. Bahl v. Byal, 90 Ohio St. 129, distinguished.

      J. Louis Kohl and Peak, Shaffer <So Peck, for plaintiffs in error.

      Rufus B. Smith, Cogcm, Williams & Ragland, Horace A. Reeve and John J. Weitzel, for defendants in error.
   JONES (E. H.), J.

- This court is unanimous in the opinion that the judgment of the court below should be reversed, but we are not in agreement as to the grounds upon which our judgment shall be based.

The majority of the court is of the opinion that the third and fourth grounds of reversal as designated in the separate concurring opinion are well taken. We find error in the charge and in the admission of evidence which is prejudicial and which, therefore, makes for a reversal of the judgment.

In a separate opinion our associate goes further and favors reversal not only for these reasons, but upon all the grounds contended for by plaintiffs in error.

While unwilling to say with him that the judgment below is manifestly against the weight of the evidence or that there is no evidence of undue influence, it must be admitted that the fact that the court is thus divided upon these questions, shows at least some infirmity in the proof and that these are questions upon which the minds of men may and indeed do differ.

Such being the situation1 confronting the learned judge who presided at the trial, it became his duty in charging the jury to avoid a departure from tbe evidence or, rather, to confine himself to the law applicable to the facts brought out or'supported by evidence adduced during tbe trial.' This' was not done, when the court in its general charge said:

1 ‘ If, however, there is a preponderance of the evidence showing * * * that said instrument was executed by John Nie-mes while under the undue influence of defendants, or any of them, then said instrument should be declared to be not the last will and testament of John Niemes. ” *******
‘ ‘ The exercise of undue influence need not be shown by direct proof. It may be inferred from circumstances; but these circumstances must be shown by the evidence and be such as to justly lead to the inference that undue influence was employed and the will was not the wish or intention of the testator. * * * If deceived by misrepresentations or coerced by threats or solicitation or persuasion, or even by mercenary kindness or attentions, or influenced by the constant pressure of a dominating or controlling mind which constrained him into executing a will he would not of his own inclination have made, then the jury may find that undue influence has been exerted over the mind of the testator. ’ ’

There is no evidence of misrepresentation or deception, coercion or threats. It was error to use such words in the absence of evidence upon which to base them. As to the probable effect of an unwarranted charge of this kind upon the jury, we fully agree with the following from the brief of counsel for plaintiffs in error:

“When the presiding judge thus states in detail contingencies upon which the will may be set aside, the jury is entitled to infer that he is speaking of something, the existence of which the jury is at liberty to infer from the evidence under consideration. The jurors do not accept such a charge as an abstract lecture on the subject of undue influence in general. On the contrary, it is supposed to be given and is accepted in the concrete, with strict application to the case in hand, and where the judge speaks of the possibility of ‘coercion, threats, misrepresentation and deceit,’ they certainly think they have a right to go as far as he and ‘infer from circumstances’ that some of those vicious elements produced the will in question.”

It is such a well settled principle, that courts must limit the charge to the facts which the evidence tends to establish, that we deem citation of authorities unnecessary.

We are of the opinion, .also, that the court erred in permitting a number of lay witnesses to testify as to the lack of ability of the testator “to understand and decide large and complicated business propositions.” Questions of such import were asked numerous lay witnesses, and answers given, over objection by the defendants. The porters, janitors, etc., employed in and about testator’s saloon, were permitted'to say to the jury that in their opinions Mr. Niemes could not understand and decide large and complicated business transactions.

It is claimed that our Supreme Court has decided such evidence to be admissible in Bahl v. Byal, et al, 90 Ohio St., 129 [106 N. E. 766], The portion of the syllabus relied upon reads thus:

“It is competent for the physician of a testator to express an opinion as to the actual condition of his patient’s mind, founded on his study and observation of the testator while in professional attendance on him at the time and prior to the date of the will, and whether he was capable of comprehending large and complicated business propositions or the distribution of a large estate. ’ ’

We also quote from the opinion, page 135:

‘1 Preceding the questions and answers referred to, the physician had testified to his complete knowledge of, and acquaintance with, the physical and mental condition of Mr. Byal covering a period of about fifteen years prior to this death. This knowledge had been obtained by the study of those conditions while in the performance of his duties as the physician of testator during that period and through the close association and complete opportunity which follow that relationship. In that testimony the doctor had fully described the gradual, well-defined and constant decline in the mental and physical powers of the testator after the year 1900, due to the influences of extreme old age, the effects upon his nervous system of different attacks of, sickness and of painful and exhausting operations on his eyes. ’ ’ ;

And from page 137:

‘ ‘ The last three questions differed from those that preceded them in that they inquired for the opinion of the doctor as to the capacity of the testator based upon the knowledge which the doctor himself had of his mental and physical condition, all of which he had fully detailed in the preceding parts of his evidence. He was asked to take into consideration the diseased and enfeebled condition of the testator, both mentally and physically, as he had already described it, and to give an opinion as to whether he was capable qf understanding and deciding large and complicated business propositions, and the division and distribution of an estate valued at about $70,000. It called for his opinion as an expert, based on facts within his own knowledge and as to which he had testified, concerning the capacity of the testator to comprehend the matters referred to. This was an evidential fact, proper to be given to the jury as evidence, to be considered by them along with all the other evidence In the ease in the determination of the ultimate question at issue.”

It is true that the question propounded to the family physician in the above case was the same question asked the employees and acquaintances of testator. But in other respects there is a vast difference. The Supreme Court, in Bahl v. Byal, supra, bases its opinion, holding the evidence admissible, upon the fact that the witness had been for fifteen years the physician of the testator, and that the question and answer were preceded by a long examination of the doctor during which he had detailed the gradual decline of his patient into a condition of enfeebled body and mind.

We do not think the rule established in that case should be extended so as to apply to the very different character of testimony allowed by the trial court in the instant ease.

For these reasons the judgment will be reversed, and a new trial granted.

Jones, (O. B.), J., concurs.

Gorman, J.,

concurring.

I concur in the conclusion reached by the majority of the court that the judgment must be reversed, not only for the reasons assigned in the opinion of the majority, but for the following additional reasons:

It appears from tbe record in the ease that John Niemes owned and conducted- a saloon, restaurant and billiard hall on the south side of Fifth street just west of Vine,'in Cincinnati; that he had carried on that business there for several years and had accumulated quite a competence. He had in his employ from fifteen to twenty persons — bookkeepers, bartenders, waiters, cooks, dishwashers and others — and he.served a great number of people with meals every day. .The receipts, of his business approximated $300 a day or about $100,000 a year. The business required close attention, application and considerable ability, and Niemes manifested a peculiar and special ability to conduct a cafe and saloon. Ife had been suffering for some time from stone in the kidney, and on January 20, 1913, he decided to 'go to- the hospital and have an operation performed for its removal. On this day,, previous to going to the hospital, he executed his will. The record discloses that he had under consideration the execution of his will for some time prior to the date . of its execution — the period ' extending back as far as August, 1912. The operation upon him was performed at Christ Hospital on the day following the execution of the will, January 21, 1913. A second operation was performed on him in February, from the effects of which he died on the 17th of March, 1913, about two months after the execution of the will.

The plaintiffs in error, who are the representatives of his deceased mother, the brothers, the nieces and nephews of John Niemes, claim that there is error apparent on the face of the record in this, to-wit: first, that the verdict of the jury and the judgment of the court are manifestly against the weight of the evidence; second, that there was- no evidence of undue influence offered in the trial of the case and that therefore this question should have been withdrawn from the consideration of the jury; third, that the court erred in charging the jury upon the question of. undue influence in the absence of evidence tending to support such question; and also in the general charge and in the giving and refusal of special charges; fourth, that the court erred in the admission of evidence objected to at the time by counsel for plaintiff in error.

A great number of witnesses were offered by the contestant and the proponents of the will. No physicians were called by the contestant to testify as to the mental condition of John Niemes, at, before or after, the time he executed the will. The jihysician attendant at his last illness, and the physicians who called upon him on one or two other occasions, testified that he was mentally sound. The nurses who attended him at the hospital during the period of almost two months, testified that he-was mentally sound. Other persons connected with the hospital who came in contact with Niemes and had occasion to observe him, testified that he was mentally sound. The witnesses to the will, both lawyers, testified that he was mentally sound at the-time he executed the will. Many other witnesses who were called,, who had occasion to observe Niemes from time to time covering-a considerable period prior to the execution of the will, all testified that he was mentally sound and capable of making a will.

Many witnesses were called by the contestant, among them being waiters, bartenders and others who had been employed by Niemes in his business. Most, if not all, of these witnesses testified that in their opinion Niemes was not mentally sound. Their-judgment was. based upon their observation of him. They testified that at times he was nervous and not interested; absentminded ; would abruptly leave people; would forget things very readily; that he would discharge some of his people and reemploy them; that he had arguments with people, and many other incidents were recited upon which they based their opinions as to his mental capacity.

I am of the opinion that when the presumption of law that the probating of a will makes it a prima facie ease as to its validity, is added to the testimony of the physicians who waited upon him, the nurses who attended him, the witnesses who attested the will — -in opposition to the testimony of persons who-were not in as good a position to observe Niemes’ mental condition, the verdict of the jury is manifestly against the weight of the evidence. It appears to me that the jury undertook to substitute its will and its judgment for that of John Niemes, and that because the will was not such as the jury would have made, they conceived it to be their province to set aside the will. I am of the opinion that the testator should be the one to make his will and not a jury, as appears to have been done here.

Furthermore, I think the record shows that there is not & scintilla of evidence in this case tending to show undue influence. It is true that the brothers, Henry Niemes and Jacob Niemes, are; beneficiaries under the will, and it was charged by the contestants that the testator had been unduly influenced by Henry and Jacob Niemes, and by Louis Kohl, the attorney who drew the will. ' There is no evidence whatsoever that Jacob or Henry Niemes, or Louis Kohl, exerted any undue influence, or any influence whatsoever to induce John Niemes to execute this willr There is evidence by Mrs. Niemes, the contestant, and a friend of hers, Mrs. Hobson, that John Niemes had said on one or two occasions that his brother Jake, who lived in Chicago, had' asked him to make a will and that he had said he didn’t see any reason for making a will. There is also evidence tending: to show that Jacob Niemes knew' of John’s intention to make a. will and that he was present on one or two occasions when Joins discussed his will vdth his attorney, Louis Kohl. Manifestly,, this is not evidence of undue influence. Under the law, onc-may influence another to make a will in his favor if he so desires, provided he does not make any false representations or practice impositions upon him to induce him to make a will, ir_-substance perpetrating a fraud upon the testator. But there N no evidence in this case, or any circumstances, from which undue influence could be found or inferred. The mere fact tha:> Jacob and Henry Niemes are beneficiaries under the will doe& not even tend to establish undue influence. They were hit-brothers, and it would appear to be perfectly natural for him ti.< remember them in his will; nor can any presumption or infer’ énce of undue influence be drawn from the fact that they art beneficiaries under the will; nor could any presumption of unduif influence be drawn from the fact that they were in a position ■ to have unduly influenced him.

Counsel for defendants requested the court to give severa-special charges which tended to eliminate from the minds o-i the jury the question of undue influence. These special charges, numbered 1, 2, 3 and 4, were refused. In refusing to give them-, it appears to me that the trial court erred. These charges werrw all to the effect that there was no evidence in the case that tha? paper writing purporting to be the last w'ill and testament &5. John Niemes was executed while he was undhr restraint or undue influence and therefore the jury were not to consider the question of undue influence in determining whether or not the paper writing submitted to them was the last will and testament of John Niemes. If there was no evidence of undue influence, there should have been no charge touching this question.

It has been urged that in vietv of the fact that there were two issues in the case, to-wit, the mental capacity of John Niemes to make a will, and the question of undue influence exerted upon him, the fact, if it be a fact, that it was error on the part of the trial court in refusing to give the special charges and in incorporating in his general charge the question of undue influence, wqs not prejudicial to the plaintiffs in error because, non constat, the jury may have found that the paper writing was not the last will and testament of John Niemes because of his mental incapacity.

But there were not two issues in the ease. There was only one issue, and that was whether or not the paper -writing was the last will and testament of John Niemes. It was not the last will and testament of John Niemes if he did not have mental capacity to make a will, or if he was unduly influenced to make the will. The reasons or grounds upon which the jury were to determine whether the paper uniting was or was not John Niemes’ will were the facts as to his mental capacity, and undue influence; but these facts do not constitute the issues in the case, and therefore the rule invoked by counsel for defendants in error that even though there wras no undue influence shown, nevertheless the verdict and judgment should stand because on the other issue, to-wit, mental capacity, the jury were warranted in setting aside the will, does not hold.

If there was no evidence of undue influence and the court charged the jury upon that question, it is impossible for this court or any other court to say that the jury did not return a verdict setting aside the wall on the ground of undue influence. It was error to refuse to give these special charges, and it was error to give the general charge as given; and these errors were prejudicial, and being prejudicial, the verdict should not stand.


author: POWELL,'J.

text:
    MUNICIPAL CORPORATIONS.
    [Licking (5th) Court of Appeals,
    March Term, 1916.]
    Shields, Powell and Houck, JJ.
    Edward M. O’Grady v. Newark (City.)
    Municipality Liable for Injury From Explosion of Peanut Roaster on Street.
    A petition alleging that through the negligence of the defendant municipality the operation of a peanut roaster on the streets of said city was permitted, that such roaster exploded and a part thereof struck plaintiff to his injury states a cause of action; hence, if there is evidence tending to establish the truth of the allegation, it is error to arrest the case from the jury and give judgment for the municipality.

      Frank .1. Bolton,.tax plaintiff in error.

      Ralph Norpell, City Sol. for defendant in error.
   POWELL,'J.

This action ivas commenced by the said plaintiff, who is now plaintiff in error, to recover damages from.the defendant for alleged negligence in the care of the streets and public square of the city of Newark, in that the city allowed upon its streets, and near the public square of said city, a certain peanut roaster which, on the 31st day of August, 1911, exploded, and a part of which, after such explosion, struck the plaintiff, to his injury.

The petition, by proper averments, charges negligence upon, the part of the defendant in permitting such dangerous implement to be upon the streets of such city, and charges that the city is liable for such negligence.

Issue was joined by answer to the amended petition filed in the case, in which the defendant admits certain averments of the petition; and after such admission denies each and every allegation contained in said petition, and being in its nature a general denial of the material averments of the petition. A second defense is set out in which it is claimed that the plaintiff made a settlement with the owners of the peanut roaster for damages received by reason of such explosion. To this, a reply is filed.

The case came on for trial, and the plaintiff’s evidence was presented to the jury, when a motion ivas made by counsel for tbe defendant to direct the jury to return a verdict in its favor, which motion was sustained, and a verdict was returned accordingly. A bill of exceptions was taken embodying all the testimony and the instructions of the court, and the case was brought into this court for review.

Upon examination of the record, this court is of the opinion that the action of the court in thus directing a verdict was erroneous; that plaintiff’s amended petition sets forth a cause of action in his favor as against the cit3r; that there are sufficient ■averments in said amended petition which, if found to be true, would entitle him to a verdict at the hands of the jury, and that the court erred in directing a verdict in favor of the defendant. In other words, the court is of the opinion that there is sufficient evidence shown by the record in favor of the plaintiff to entitle him to have the same submitted to a jury, and that the court should have overruled the motion of defendant asking that a verdict be directed in its favor. For this reason, the judgment of the court below will be reversed, and the case remanded for a new trial.

Shields, and Houck, JJ., concur.


author: MEALS, J.

text:
    APPEAL — WORKMEN’S COMPENSATION.
    [Cuyahoga (8th) Court of Appeals,
    June 1, 1915.]

    Meals, Carpenter, Grant, JJ.
    Samuel Hoogenboom v. Industrial Commission of Ohio.
    Workman Employed by One Not Complying with Compensation Act Cannot Appeal from State Liability Board of Awards.
    A workman who suffers an injury while in the employ of one who has not complied with the provisions of the workmen’s compensation act has no right of appeal from the determination of the state liability board of awards on his application for compensation on account of such injury.
    ERROR.

      Harry F. Payer, for plaintiff in error.

      Cyrus Looker, Pros. Atty. for defendant in error.
   MEALS, J.

The plaintiff sustained certain injuries while in the employ of the Cleveland Co-Operative Stove Co., which company had not complied with the provisions of the Ohio workmen’s compensation act.

In pursuance of the provisions of See. 27 of the compensation act 103 O. L. 82, the plaintiff filed an application with the state liability board of awards for compensation, in accordance with the terms of said act. Sec. 27 is as follows:

“Any employee whose employer has failed to comply with the provisions of Section 22 hereof, who has been injured in the course of his employment, wheresoever such injury has occurred, and which was not purposely self-inflicted, or his dependents in ease death has ensued, may, in lieu of proceeding against his employer by civil action in the courts, as provided in the last preceding section, file his application with the state liability board of awards for compensation in accordance with the terms of this act, and the board shall hear and determine such application in like manner as in other claims before the board; and the amount of compensation which said board may ascertain and determine to be due to such injured employee, or to his dependents in ease death has ensued, shall be paid by such employer to- the person entitled thereto within ten days after receiving notice of the amount thereof as fixed and determined by the board; and in the event of the failure, neglect or refusal of the employer, to pay such compensation to the person entitled thereto, within said period of ten days, the same shall constitute a liquidated claim for damages against such employer in the amount so ascertained and fixed by the board, which with an added penalty of fifty per centum may be recovered in an action in the name of the state for the benefit of the person or persons entitled to the same. And any employee whose employer has elected to pay compensation to his injured, or to the dependents of his killed employees in accordance with the provisions of Section 22 hereof, may, in the event of the failure of his employer to so pay such compensation or furnish' such medical, surgical, nursing and hospital services and attention or funeral expenses, file his application with the state liability board of awards for the purpose of having the amount of such compensation and such medical, surgical, nursing and hospital services and attention or funeral expenses determined; and thereupon like proceedings shall be had before the board and with like effect as hereinbefore provided.”

The industrial commission rejected plaintiff’s claim on the ground that “the proof submitted by applicant does not establish the fact that applicant received an injury while in the course of employment; and the proof submitted by the applicant does not establish the fact that applicant’s disability as shown in his application, was caused by an injury sustained in the course of his employment.”

Thereafter-, the plaintiff filed an appeal from the determination of the commission in the court of common pleas, claiming the right so to do by virtue of the provisions of Section 43 of said act. See. 43 is as follows:

“The board shall have full power and authority to hear and determine all questions within its jurisdiction, and its decision thereon shall be final. Provided, however, in case the final action of such board denies the right of the claimant to participate at all in such fund on the ground that the accident did not arise in the course of employment, or upon any other ground going to the basis of the claimant’s right, then the claimant, within thirty days after the notice of the final action of such board may by filing his appeal in the common pleas court of the county wherein the injury was inflicted, be entitled to a trial in the ordinary way and be entitled to a jury if he demands it. In such a proceeding, the prosecuting attorney of the county, without additional compensation, shall represent the state liability board of awards and he shall be notified by the clerk forthwith of the filing of such appeal.
“Within thirty days after filing his appeal, .the applicant shall file a petition in the ordinary form against such board as defendant, and further pleadings shall be had in said cause, according to the rules of civil procedure, and the court, or the jury, under the instructions of the court, if a jury is demanded, shall determine the right of the claimant; and if they determine the right in his favor, shall fix his compensation within the limits under the rules prescribed in this act; and any final judgment so obtained shall be paid by the state liability board of awards out of the state insurance fund in the same manner as such awards are paid by such board.”

The defendant filed a demurrer to the plaintiff’s petition filed in the'appeal, which demurrer was sustained.

The act relates to and embraces both employers who do and those who do not comply with the provisions of the act. Thus, two classes of employers are contemplated in the act. Sec. 27 of the act relates to the class which has failed to comply with the provisions of the act. An employee of this class is given an election of remedies for injuries sustained in the course of .his employment. He may proceed against his employer by civil action in court, or, in lieu thereof, he may “file his application with the state liability board of awards for compensation in accordance with the terms of the act, and the board shall hear and determine such application for compensation in like manner as in other claims before the board; and the amount of compensation which said board may ascertain and determine to be due to such injured employee, or to his dependents in case death has ensued, shall be paid by such employer to the person entitled thereto within ten days after receiving notice of the -amount thereof as fixed and determined by the board; and in the event of the failure, neglect or refusal of the employer to pay such compensation to the person entitled thereto within said period of ten days, the same shall constitute a liquidated claim for damages against such employer in the amount so ascertained and fixed by the board, which with an added penalty of fifty per centum may be recovered in an action in the name of the state for the benefit of the person or persons entitled to the same, ’ ’ etc.

Obviously, therefore, if an employee of this class elects to file his application with the state liability board of awards for compensation, he may have his claim for damages against his employer liquidated, and if not paid as provided in the act, “may recover the amount thereof, with an added penalty of fifty per centum in an action in the name of the state for his benefit.” He is not, however, by this section or any other of the act, given a right to have “the amount of compensation which said board may ascertain and determine to be due such injured employee, or to his dependents in case death has ensued, ’ ’ paid out of the insurance fund created by the act; and nowhere in the act is an employee of this class given the right of appeal from the determination of the board.

Section 43 of the act relates to the class of employers who have complied with the provisions of the act, and contributed to the insurance fund created by the act. And Sec. 23 of the act provides that an employer who has complied with the provisions of th.e act “shall not be liable to respond in damages, at common law or by statute, for ah injury or death of any employee, wheresoever occurring, during the period covered by such- premiums as he has been required to pay into the state insurance fund. ’ ’

An employee of this class has bjut one remedy for injury sustained by him in the course of his employment; that is, to file his application with the state liability board of awards for compensation to be paid out of the state insurance fund, and the decision of the board thereon is final, provided, however, “in case the final action of the board denies the right of the claimant to participate at all in such fund on the ground that the accident did not arise in the coursexof employment, or upon any other ground going to the basis of the claimant’s right, then the claimant” shall have the right of appeal from the determination to the court of common pleas.

From this we think it clear that the right of appeal is given only to the employees of this class.

We conclude, therefore, that the demurrer was properly sustained, and the judgment is affirmed.

Grant, and Carpenter, JJ., concur.


author: 43RANT, J.

text:
    BENEFICIAL ASSOCIATIONS.
    [Wood (6th) Court of Appeals,
    December 5, 1914.]
    Winch, Meals and Grant, JJ., of Eighth district sitting by designation.
    William Munn v. Henry M. Barfield, Recvr.
    1. Judgment Against individual Member Enforcible in Action Against Beneficial Association.
    A beneficial organization membership subscription is equivalent to a power of attorney to the association to appear and act and be bound in the place of the said member in respect to the corporate functions of the association; hence, a judgment against an individual member for unpaid assessments to pay death losses, obtained against the association by a beneficiary acting for herself and all other beneficiaries similarly situated and entitled, is a valid judgment until met by the defense that the alleged debtor was not a member of the association at the time the liability arose, or that he has paid the assessment, or has a set-oil against it.
    2. Denial of Day in Court Does not Lie by Member of Beneficial Association Haled Into Court Without Defense.
    The expression “a day in court” means simply that there has been due process of law with respect to notice to defendant and an opportunity to be heard, and complaint of denial of his right to a day in court does not lie in the mouth of one who has been haled into court and given an opportunity to present a defense, but had none to offer which went to the merits of the case pending against him.
    Error.
   43RANT, J.

The parties stand here, as to position, in the inverse order of their standing in the court below, but to avoid confusion they will be designated in the opinion as they were there.

The action in the first instance was brought before a justice of the peace and in that court the defendant prevailed. Upon an appeal had and issues joined by pleadings in the court of common pleas, the ekuse came to a trial to a jury. At the conclusion of the plaintiff’s evidence the defendant moved for a direction to the jury to return a verdict in its favor, which was refused, and he excepted. The defendant then offered some testimony, which upon objection made was rejected, and on motion oE plaintiff the court thereupon instructed the jury to return a verdict- for him, which was done, and the defendant saved his exceptions. A motion for a r.ew. trial was seasonably made and denied. Whereupon judgment was entered upon the verdict: To all of which, also exceptions were duly taken. The action of the trial court in taking these various steps is assigned as error, upon which this proceeding is prosecuted.

Reduced to its lowest terms the complaint is this, for substance : The defendant was a member of the Northwestern Ohio Masonic Relief Association, a statutory beneficial organization, and as such he was subject to assessments to meet death losses as the same might accrue. While he was such member and so liable, certain deaths did occur and assessments in that behalf were duly made. Upon default for payment of these losses an action was begun in the courts of Lucas county by a beneficiary entitled to be paid the avails of an assessment, against the association and its trustees, on her own behalf and on the behalf a3 well of all others similarly situated and entitled, the object of which, among others, was to have found the number and amount of such unpaid assessments, the reduction of the same to judgment, the ascertainment cf the- members liable to contribution to the payment thereof and the amounts of their several liability in that behalf, the levy of an assessment, ratably, upon each liable member, and the appointment of a receiver to enforce collection, the association and its trustees and officers having failed to do so.

In that cause such proceedings were then had that the allegations of the petition were found to be true and the relief prayed for was allowed, and the plaintiff in this action was appointed receiver and clothed with adequate authority to begin and prosecute it to effect in all proper jurisdictions, the defendant having been found in the suit of origin to be liable in the amount sued for here.

In this suit the plaintiff declared on the finding and judgment of the Lucas county court, setting out the proceedings in exienso, with proper exemplification, in his petition, all of which he proved on the trial.

The defendant’s answer was a general denial in manner and form, followed by a perfunctory, denial, for alleged want of knowledge, of the proceedings and judgment had in Lucas county. Then he made his real supposed defense, to the effect that he was no party to the Lucas county judgment, for which reason he was in no manner concluded by it, and that in so far as it purported to fasten a money liability on him, it was void.

This asserted nullity of the judgment, so far as it touched him, was the real and sole' issue in the case. It amounts to this, as was heard many times in the argument for the defendant at the bar, and which we'find repeated in his brief, that the defendant has not had “his day in court.” That question settled, and all the complaints lodged in the petition in error here are settled.

When the defendant moved the court for a directed verdict on the plaintiff’s evidence, it may, we think, be doubted whether technically he did not then end thereby submit the case to the court for determination, upon which submission the court, by directing a verdict for the plaintiff, found, as a matter of law, the issues with the latter for want of defensive evidence, and whether the subsequent tender of evidence by the defendant was seasonable to arrest that consequence.

But as the trial court did not proceed on that footing, but found that the offered testimony constituted no legal defense to the action and was therefore incompetent, and as the point is not relied on here to uphold the judgment complained of, no further observation in this respect is deemed proper.

As to the question really in issue here, we do not think it is open in Ohio.

It was no part of the duty or right of the defendant to make the assessments or to pay them. By becoming a member of the association he surrendered that and consented to be represented in those respects by the association. His subscription to membership amounted to a power of attorney to the association to appear and act and be bound in his place and stead, in these corporate respects and relations. So that, whenever it became necessary to resort to legal compulsion to enforce the performance of the corporate duties of making assessments, he was conclusively there in the person of the association. It is true that lie would be there sub modo only and vicariously, but effectually there for that purpose. Upon these matters and in this relation, therefore, it can not be said that in the case in hand the-defendant has not had his day in court.

If it shall be said that the finding of the Lucas county court east him in judgment in an amount certain, and that for that reason a personal obligation has been fixed without summons or other process on him, the answer is that in so far as that court proceeded in determining the necessity, of the assessments and the duty of making and paying them, the sole right of appearance and defense was with the association in its capacity as the representative of its members. And the consequent function of ascertaining how many members there were was clerical only and sounded in rem, so to speak. Given the assessments to be met and the number of the association members, and an arithmetic does the rest. From those data it is a mere matter of computation to find all that the Lucas county court purported to find, aside from those matters in the action as to which the defendant must be deemed, conclusively, to have been represented by the corporation. So far, he had no day in court because he was entitled to no day. In all that was done there no personal right and no substantive individual defense of his was touched to his hurt. All these were preserved to him, to be asserted at bis will whenever he should be haled to court at the foot of a summons to answer to a demand for judgment. Among those rights preserved to him was that of showing that he was not a member of the association at the time the liability to assessment arose, or that he had paid his assessment, or that he had a set-off against it. The court in that action settled none of those things beyond his right of opportunity to assert them, issuably, to a jury.

That the corporation is held to have represented him in the Lucas county action as to the necessity of the assessments, their validity and amount, is not, we think, to be doubted under the law as settled in Swing v. Rose, et al., 75 Ohio St., 355 [79 N. E. 757], without the presence of the defendant in court. The liquidation evidence in that ease by premium notes is not to be differentiated from that which resulted in this case from the-legal maturing of the death losses.

With those matters adjudicated, all else done in the court of Lucas county was clerical only; an adding machine could have done it as well as the court and at less expenditure of mental tissue.

"We now approach the master grievance of the defendant urged upon us here. It is that he has not had “his day in court. ’ ’ The expression is often inaccurately used. "What really is meant by -day in court ‘is due process of law. Two things are essential to it: first, lawful notice1; second, opportunity to be heard.

Bearing in mind the rights we have stated which were reserved to him, in the former action, and as to those rights, the defendant has had fulfilled to Mm both these fundamental conditions of due process of law; he has been summoned to judgment and he has had full opportunity to be heard. Being thus summoned, and having his chance to speak in his answer to the challenge, does it appear that he was not a member of the association? He does not claim it. Does he assert payment by him of his ratable share of the assessments found necessary in the action in which, as to that thing, he was vicariously but still conclusively represented by the corporate association, or a set-off against them? He does not. A consideration by the trial court of anything else offered by him as evidence, would be threshing over old straw or else entirely beside the question.

He has had his day in court. That is to say, he has had due process of law, running to him, personally, and when brought to the bar he has nothing to the purpose to offer. So thought the trial court, and we agree with it. We can not see that any error of substance, to the injury of the defendant, has intervened in this record, nor can we say that in the proceedings substantial justice has not been done.

The judgment complained of, therefore, is affirmed.

Winch and Meals, JJ., concur.


author: HOUCK, J.

text:
    PRINCIPAL AND SURETY — RECEIVERS.
    [Licking (5th) Court of Appeals,
    March Term, 1916.]
    Shields, Powell and Houck, JJ.
    Joseph N. Pugh, Recr. v. American Bonding Co.
    Successor of Receiver Bound' by Agreement Previously Entered Into by Order of Court. ,
    A clause in a contract of suretyship, procured by order of court by a receiver, wherein it was agreed that the surety should be saved from costs and expenses, is binding on the successor of said receiver and the fund in his hands is liable thereunder, and the claim does not lie that the said agreement was entered into by the original receiver in his individual capacity.
    Error.

      Kibler & Kibler, for plaintiff in error.

      Flory & Flor?/, for defendant in error.
   HOUCK, J.

, It is sought by this proceeding to reverse the judgment of the common pleas court obtained by the defendant in error, the plaintiff below, against the plaintiff in error, who was the defendant below.

The material facts in this case necessary to determine the rights of the parties hereto are as follows: George P. Webb, the then receiver of the' Homestead Building & Savings Company, was authorized by the court by whom he was appointed receiver to bring suit and attach certain property reputed to belong to one Mary J. Lingafelter, which he did, and gave bond with the American Bonding Company as surety, which bond was issued to him on his written application and contract with said bonding company. After the termination of said suit in attachment, which terminated in favor of Mary J. Lingafelter, the said Mary J. Lingafelter brought suit against the plaintiff in error herein, being the successor of the said George P. Webb, as receiver aforesaid, the said George P. Webb having departed this life, and the American Bonding Company, for damages growing out of said suit in attachment. On motion made to the court tbe said Mary J. Lingafelter was required to elect which defendant she would prosecute said suit against, and she elected to prosecute the same against the bonding company. The suit terminated in favor of the bonding company. The American Bonding Company then filed an intervening petition seeking to recover from the funds in the hands of said receiver the attorney’s fee and expenses incurred in defending said suit. The court below ordered and directed the receiver to allow said ■ claim to the amount of $432.25, with interest. To this order and judgment of the court below the plaintiff in error prosecutes error to this court asking a reversal of said judgment.

Plaintiff in error contends, first, that the contract for the bond in question was not the contract of Joseph N. Pugh, receiver, but was the contract of George P. Webb, as receiver. Second, that the agreement to indemnify the bonding company against litigation, costs, attorney fees, etc., was upon Webb only, and could not bind the funds in his hands as such receiver. Third, that there was no liability on the bond.

It is earnestly contended by counsel for plaintiff in error that because Webb, as receiver, made application for the surety bond in question that any agreement made by him and any liability incurred thereby does not bind his successor, Joseph N. Pugh, as receiver. We can not agree with counsel in this. A receiver is simply the creature of the court, and acts for the court, and to all intents and purposes, so far as the receivership is concerned, is the court to that extent; and the mere fact that a receiver dies, or resigns, or is removed by the court and a new one is appointed, in no way lessens the legal liability of, or in any way affects or lessens the lawful acts done by his predecessor under authority of and direction of the court, which fully appears in the instant case. The claim that the liability, if any exists, is a personal one against Webb, and does not bind the funds in the hands of the receiver, is not well taken. The surety bond in question was secured by order of the court. The application and contract for the same was made with the bonding company by Webb, as receiver, and in the interest of and for the benefit of the trust estate, and not in the interest of or for Webb personally. The application was made by Webb as.' receiver, and the bond was issued to him .as such, and his successor and the trust estate is bound thereby in just the same degree and to the same extent as if Webb had continued as such receiver.

An examination of the application and contract made by the receiver, Webb, clearly shows an express contract whereby the receiver agrees to save the bonding company from any damages, costs, etc., as will fully appear in paragraph four of said contract, which is as follows:

“That said applicant [Webb] hereby further agrees in the event of a failure to comply with any or all of the covenants, conditions and agreements hereinbefore expressed, to substitute other sureties on said bond within fifteen days after notice of such non-compliance or default has been given to said applicant by the said company. Any damages, costs or expense which said company may sustain, or incur, or be put to, including traveling expenses, costs for investigations, court costs and lawyers’ fees, in obtaining a release or discharge from said bond as surety thereon, shall be borne and paid by said applicant when and as said company’s liability for the same shall accrue. ’ ’

In the light of the provisions, conditions and terms of the said contract between Webb, as receiver, and the bonding company, and the law governing receivers, their rights and liabilities upon contracts made in the interest of the trusts they represent by and under the authority and direction of the court appointing them, and in the light of the law governing the rights of principal and agent, we can arrive at but one conclusion, and that is that the judgment of the court below is right; and a majority of the court being of that opinion, the judgment of the court of common pleas is affirmed.

Shields, J., concurs.

Powell, J., dissents.


author: SHIELDS,, J.

text:
    STREET RAILWAY.
    [Licking Court of Appeals,
    October Term, 1915.]
    Powell, Houck and Shields, JJ.
    Ohio Electric Ry. v. Margaret J. Vaughan.
    Duty of an Electric Railway Company Toward Passengers Who Are Attempting to Alight.
    In an action by a woman who was injured by the premature starting of a car from which she was alighting, a request by the defendant company for the special charge before argument, that if the jury found
    “ — that the car remained standing for a space of time sufficient for her to alight and then started, that there was nothing to prevent her alighting while the car was so standing, that she remained standing on the platform step for that period of time, and then started to alight as the car started to move forward, and was thrown and injured thereby, she can not recover”— was properly refused, where the testimony establishes that the place where the accident occurred was a regular stop at which passengers were in the habit of boarding and leaving the cars, that the conductor knew the plaintiff desired to alight at that time and place and was encumbered with bundles, and there was testimony tending to show that she had started to alight when the car was started forward.
    Error.

      Fitzgibbon, Montgomery & Black, for plaintiff in error.

      Jones & Jones and B. F. McDonald,, for defendant in error.
   SHIELDS,, J.

Tbis was an action' commenced in the court of common pleas of said Licking county by the defendant in error, plaintiff below, to recover damages against the plaintiff in error, defendant below, for personal injuries claimed to have been sustained by the defendant in error through the alleged negligence of the plaintiff in error.

The petition of the plaintiff alleged in substance that on the 13th day of June, 1913, she being then a passenger on one of the defendant company’s cars operating its line of street railway between Zanesville and Newark, Ohio, notified the conductor of said car that she desired to alight therefrom at what is known as the B. & 0. crossing on East Main street in the city of Newark; that upon reaching said crossing said car stopped; that upon being notified by the conductor of said ear that said car had reached said crossing, the plaintiff thereupon attempted to alight from said ear and while in the act of so alighting and when on the steps of said car, said ear suddenly and without warning started, throwing the defendant in error violently to the pavement, injuring her as set out in her said petition to which reference is hereby made.

In its answer filed to said petition the defendant company admits that the plaintiff was a passenger on said car at said time, but avers' that if she sustained any injuries, hér own negligence contributed thereto, first, in not availing herself of reasonable time and opportunity given her to alight from said ear at said place, and secondly, in attempting to alight from said car while it was in motion.

While we do not find any reply to said answer among the files in said case, it was conceded that one had been filed- in the nature of a general denial of the allegations contained in said answer.

• Said cause was submitted to a jury and a verdict returned for the plaintiff. A motion for a new trial was overruled and judgment entered on said verdict. A bill of exceptions was duly prepared and filed and a petition in error was filed in this court for a review of said judgment.

Said petition in error contains numerous assignments of error but the grounds of error insisted upon to this court were:

1. That the court below erred in giving certain written requests before argument in charge to the jury on behalf of the plaintiff below, and in refusing to give in charge to the jury before argument pertain written requests in writing on behalf of the plaintiff in error, and for error of the court in its general charge to the jury. ■ <

2. That said court erred in its instructions to the jury in respect to the duty of the conductor of a car to look, after passengers alighting from said car.

3. That the verdict of the jury is against the weight of the evidence and contrary to law.

Numerous requests appear to have been submitted in writing before argument both by the plaintiff and the defendant below with the request that they be given by the court in its charge to the jury, and it further appears that the requests so made by the plaintiff in error were so given, except the last found on pages 155 and 156 of the bill of exceptions, which action of the court in refusing to give said request in charge to the jury is assigned as error. It is apparent that if the requests submitted by the defendant in error, which were given by the. court in charge to the jury, contained sound propositions of lawr said request of the plaintiff in error was properly refused. Said request is as follows:

‘! If you find that the plaintiff was standing on the rear platform of the car for the purpose of alighting therefrom when, the car was stopped, that the car remained standing for a space of time sufficient for her to alight, and then started, that there was nothing to prevent her alighting while the car was so standing, that the plaintiff remained standing on the platform step for that period of time, and then started to alight as the car started to move forward, and was thrown and injured thereby, she can not recover in this action, and your verdict should be for the defendant.”

We think that the foregoing request was properly refused. It appears that the B. & 0. crossing at this place was a regular stopping place where passengers were in the habit of getting on and off said defendant company’s cars, where the conductor of the car in question knew that the defendant in error desired to alight from said car at said time and place, and where, as the testimony tends to show, said conductor knew that she started to alight from said car. If these conditions were found by the-jury to exist, was not the conductor of said car called upon to exercise care, caution and diligence, to see to it that said car was not started until the defendant in error fully and safely alighted' from said car, she being in the exercise of due care? And failing to do so, would not the defendant company, under such circumstances, be chargeable with negligence for which it would be? liable? Counsel for plaintiff in error cite us to the case of Ashtabula Rapid Transit Co. v. Holmes, 67 Ohio St., 153 [65 N. E. 877], in support of their contention. In that case there was a -confiiet in the testimony both as to whether the conductor of the car had notice that the defendant in error desired to get off the car at a given place, and whether the defendant in error had not ■attempted to alight when the car was in motion, neither of which is shown to be the fact in the case before us, for here it is admitted that the car stopped at the B. & 0. crossing, that the conductor of the ear then notified the defendant of such fact, and the defendant in error testified that she immediately followed the conductor to the vestibule of the car and when she reached the steps of the car in the act of getting* off, the ear suddenly and without warning started and threw her to the pavement and injured her. Judge Davis in announcing the opinion in the case cited says:

“There is also conflict as to whether or not the eonductdr had notice of the plaintiff’s intention to get off, and whether the plaintiff attempted to get off while the oar was moving. If the ear had come to a full stop for any purpose and any passenger was in the act of alighting, it would be negligence for the conductor to start the car before such passenger had a reasonable opportunity to get off safely. * # * The law exacts of carriers of passengers, a high degree of care for the safety of passengers, according to the circumstances and this duty ordinarily continues until the passenger is discharged.”

Again, in the case of Wilson v. Railway, 57 Bull. 143 (9 O. L. R. 594), which was affirmed, no op., (Wilson v. Railway, 79 Ohio St., 435), the trial judge charged the jury as follows:

‘ ‘ The fact that at the place where' this ear stopped was a railroad crossing, which required the conductor to go forward and signal the ear under his control to move forward, and that the conductor did so, did not excuse the conductor from exercising the care, caution and prudence required by law to know ■or see that the plaintiff was fully alighted from the ear before having it started. On the contrary, it was his duty, if the car stopped and it was necessary to protect the plaintiff as' a passenger and save her from injury, to exercise due care, caution and prudence to see and know that she was safely alighted from the car before going forward or having the car started, and if he failed to do so the defendant is guilty of negligence.”

And in discussing tbe care required. of a carrier toward passengers in getting on and off its cars, Thompson, Negligence, Sec. 3520, says:

“The high degree of care which the law puts upon the carriers of passengers is not fulfilled in the case of a street railway carrier, unless its servants before putting the ear in motion, see and know that all passengers in the act of alighting have succeeded in doing so in safety, and that no passenger is in such a situation as to be put in peril by the starting ear.”

Again, said section further says:

“ It is the duty of the conductor before putting 9 car in motion, to see and know that no passenger is alighting or otherwise in a position which would be rendered perilous by starting the car. ’ ’

And further:

“It is not enough that a reasonable time was given to allow passengers to alight; the carrier has no right to put his vehicle in motion and imperil life and limb, although they may have taken an unreasonable time.”

What might be a reasonable time to one, might be an unreasonable time to another. The cripple, the aged, the blind, or one lumbered up with luggage, as was the ease here, might have much to do in determining what was or what was not a reasonable time to get off. The view we entertain of the obligation of the defendant company, under the circumstances detailed in the testimony in the ease before us, is that in discharging passengers from ears at regular stopping places, they should be allowed not only a reasonable time to alight therefrom, but the duty rests npon the conductor or other employe having charge of such cars to look to it that such passengers are safely discharged before starting the car in motion again, and if such passengers are in the act of alighting and are exposed to danger, such duty becomes the more apparent.

For the foregoing reasons we think the court below did not err in refusing to- give said request, nor do we think that the said court erred in giving the written requests to the jury which were submitted by the defendant in error before argument, including the following:-

“If the door on the left-hand side of the vestibule of the ear was open when the plaintiff reached the vestibule of the car on her way to get off said car, it constituted an invitation to the plaintiff to use the left-hand side of the vestibule to get off, and her act in leaving the car on that side did not under the circumstances amount to contributory negligence. ’ ’

As counsel for plaintiff contend, the foregoing request is evidently incomplete, in this, that in the line next to the last line a word is omitted. In considering the entire charge of the court; we think it was obvious to the jury that such omission referred to the circumstances of the case, as shown by the evidence, and that the jury were not misled by such apparent unintentional omission.

As to the verdict of the jury being against the weight of the evidence, it is apparent that there is a conflict in the evidence, but there is evidence tending to support the claim of the-defendant in error as made in her petition, and under the holding in the case of Gibbs v. Girard, 88 Ohio St., 34 [302 N. E. 299; 1914C Ann. Cas. 1082], we do not feel at liberty as a reviewing court to disturb the finding of-the jury.

Other assignments of error are made in said petition in error, all of which we have examined, and we find no such error in the record for which the judgment of the court below should be reversed.

Upon the whole case, we are of the opinion that substantial justice has been done between the parties hereto by the verdict rendered, and find no difficulty in reaching the conclusion that the judgment of the eourt of common pleas should be affirmed and it is so ordered.

Houck and Ferneding, JJ., concur.