author: Price, J.

text:
    (Third Circuit—Hancock County, O., Circuit Court,
    May Term, 1896.)
    Before Seney, Day and Price JJ.
    MARIA BLAIR, HARRIET BLAIR and EMMA OBERHOLIZER vs. THE NORTHWESTERN OHIO NATURAL GAS COMPANY and THE OHIO OIL COMPANY.
    1. Where a lease was made in Sept., 1886, for the production of oil and gas for a term of five years and as much longer as oil or gas is found in paying quantities, and a well has been drilled which produced gas in paying quantities for a number of years, and for which the annual rental has been promptly paid, the lessee, if he has preformed all the conditions incumbent upon him, is entitled to a reasonable time after such well is exhausted, to drill at other locations on the premises to find oil or gas in paying quantities, and for that purpose and during such time, the lease continues in full force.
    2. Where such lease granted the lessee and its assigns the right to sub-let and subdivide the leased premises; and where, by partition proceedings, a part of the premises is set off to one of the tenants in common, the lessee may release such part from the incumbrance of the lease, and retain it in operation on the balance of the land.
   Price, J.

In April, 1895, the plaintiffs commenced this action to enjoin the defendants from entering upon a certain piece of land in Hancock county, described in the petition as containing 79 acres, and from hauling timber and lumber thereon and drilling for oil, which the defendants threaten and contemplate doing; and it is averred that they will drill for oil on the premises unless restrained by injunction.

In their petition it is averred, “That said land and all and every part thereof, is supposed and probably is valuable oil land,and capable of producing oil in paying quantities,” and that if defendants are permitted to take oil from the premises and carry the same away, it will be impossible for the plaintiffs to measure and determine the quantity or value thereof, and thereby the plaintiffs will suffer great and irreparable injury. There are other averments of numerous threatened trespasses and reasons why the injunction should be granted.

The defendants answer jointly, and admit that the plaintiffs own,in fee,the lands described in the pertition, and that they as corporations were attempting to take lumber and. timber on to the premises and drill for oil, and they, at length, set up by cross-petition their right to do so. They agree with the plaintiffs, that the premises are probably good oil producing territory, and that it was and is their purpose to develop the same for the production of oil, and for that purpose they were hauling lumber and timber and other materials on to the lands, when enjoined by order of the lower court.

The undisputed facts which are disclosed by the plead-, ings, show, that on the 14th day of September, 1886, the plaintiffs, with their sister, Mary J. Williams, as heirs of John Blair, demised and granted to The Olean Oil Company and its assigns the said premises for the purpose and with the exclusive right of drilling and operating for petroleum oil and gas ¡with the right to sub-let and subdivide all said real estate consisting of 109 acres. The grant was for the term of five years from September 14, 1886, “ and as much longer as oil or gas is found in paying quantities.”

If oil was found, the lessors were to receive in tank or pipe line one-eighth part thereof. “If gas was found in quantities to utilize and sell, tne consideration in full to the lessor should be $100 per annum for each and every gas well drilled on said premises and so used.”

The right of way over the premises to the place of operations was also granted, together with the exclusive right to lay pipes to convey oil and gas. These stipulations of the lease are made to extend to the heirs, excutors and assigns of the parlies. The lease was recorded on the 8th day of ^February, 1887.

On the 28th of December, 1886, The Olean Oil Company, in writing and for value, duly assigned and transferred said lease with all its rights and privileges to Hascal L. Taylor, his heirs and assigns. Within the first year from the date of the lease, Taylor drilled a well on the premises which produced gas in paying quantities. This was required to be done within the first year to save the lease from forfeiture.

There was no time fixed or provided within which any other well should be drilled, nor is it provided in the terms of the’lease that any additional wells must be drilled. The $100 rental for the well was paid, and on the 6th day of July, 1889, Taylor assigned and transferred the lease to the defendant, The Northwestern Ohio Natural Gas Company, its successors and assigns. These assignments were duly recorded in the proper records of Hancock county, Jong prior to the beginning of this suit, and also long prior to the time it^is claimed by the plaintiffs, the lease expired.

On the 14th day of May, 1889, and since, the business of the defendant Gas Company was the production of natural gas and supplying its customers therewith, and it owned a number of oil and gas leases; and one William Fleming, who was a producer of oil only, also owned a number of oil and gas leases, and these two parties entered into a mutual written obligation, whereby it is provided that if gas should be found in paying quantities on premises leased to Fleming, the right to develope, and produce the gas vested in the Gas Company; and in case oil should be found in paying quantiies in lands leased „ to the Gas Company, the right to develop and produce the oil vested in said Fleming and his assigns,

This instrumennt was also recorded. Its purpose and effect was and is, that the defendant,Natural.Gas Company, assigned and transferred to Fleming the oil rights and interest which might be found on its leaseholds, in consideration of receiving from Fleming an assignment of the gas rights and interests which might be found on his leaseholds.

On the first of day of June, 1889, Fleming assigned and transferred all his interests and rights in said leases and said mutual obligation to The Ohio Oil Company, defendant. After these transfers were of record, in partition proceedings for that purpose, thirty acres of the leased premises were set off to Mary J. Williams as her share of 109 acres, which left the 79 acres to the plaintiffs.

Mrs. Williams afterwards sold her 30 acres to Frank P. Blackford, and the Natural Gas Company, at his request, without objection by the plaintiffs,and also without their express assent, released the 30 acres from the operation and terms of its lease, and oil is being produced therefrom by the lessee of Blackford. The Natural Gas Company retains its lease as to the 79 acres in dispute, and the plaintiffs claim that its lease has expired, because gas or oil was not found thereon in paying quantities when this action was commenced, and that defendants had abandoned the only well and the entire premises.

• On the 24th day of April, 1895, the plaintiffs made anew lease of the 79 acres to T. C. Kelley and C. C. Harris for oil and gas purposes. It is further shown by the pleadings as an undisputed fact, that the annual rental of one hundred dollars, called for by the lease of September 14, 1886, has been promptly paid to plaintiffs in advance each year, paying up to February 1, 1896; and The Ohio Oil Company claims, that while the gas was no longer found in paying quantities at the one well, it has the right to drill for oil at other points on said premises by reason of its contract with the Natural Gas Company, and was preparing to do so when enjoined; and both defendants claim that there had been no abandonment of the premises, and that the lease was still in force as to both defendants. These adverse claims furnish the controversy between the parties.

We have thus given the facts not controverted in the pleadings at considerable length, because their averments and admissions narrow the case to a small compass.

What, under the terms of the lease and the testimony, are the rights of the parties?

The lease states: “That the said party of the first part for the consideration of the covenants and agreements hereinafter mentioned, has granted, demised and let unto the said parties of the second part, their heirs and assigns,for the purpose and with the exclusive right of drilling and operating for petroleum oil and gas, toith the right to sub-let and subdivide all that certain tract of land, etc. ’ ’ ■ (Describing the 109 acres).

The next provision reads:

“The party of the second part, their heirs and assigns, to have and hold the said premises for the said purposes only, for and during the term of five years from the date hereof (September 14, 1886), and as much longer as oil or gas is found in paying quantities.”

Again: “It is further agreed that if gas is found in quantities to be utilized and sold, the consideration in full to the party of the first part shall be $100 per annum for each gnd every gas well drilled on the premises herein described and so used.”

Another material provision of the lease is: — •

“Provided: in case no well is completed within one year from the date of this lease, then this lease shall be null and void. etc. ”

It is further provided, that if the lessee fail to pay the consideration named at the time agreed upon, the lease shall be null and void. We have already observed that a well was drilled within the year which produced gas in paying quantities, and it is conceded that the Natural Gas Company promptly paid the $100 per annum in advance each year, including the year from February 1, 1895, to February 1, 1896, covering a period of at least nine months after the plaintiffs commenced this action. It is a fact also not in dispute, that this gas well was used and operated by the Natural Gas Company for the production and supply o.f gas until some time in December, 1894, when it declined and was exhausted. There is no evidence in the case that plaintiffs ever requested or demanded ftny additional wells or development for oil or gas; nor has there been given us any evidence that any additional wells were necessary for the protection of the premises from operations on adjoining lands; and we are not advised of any ground of complaint against the Gas Company until in December, 1894, or January, 1895.

The plaintiffs were personally present at this trial, and one of them was a witness, but no • evidence was given as to any neglect or default on the part of the Company, prior to January, 1895. In December, 1894, just what date we are not informed, the existing well declined and was disconnected from the gas line, and in the latter part of that month or the early part of January, 1895, The Ohio Oil Company, by virtue of its rights under the contract already referred to,erected a rig over the old well,and endeavored to draw the tubing so the well could be cleaned out and drilled deeper, and otherwise improved for oil or gas.

For a period of six weeks or more the effort to get the tubing out continued, and finally was given up as impracticable. This was not far from Feruary 1, 1895. An agent of the defendant testifies that when he took the check to plaintiffs to make the payment for the year embraced between February 1, 1895, and February 1, 1896, he told them it was doubtful about anything being made out of the old well and that they might have to drill a new one, and asked for a suggestion as to another location. They said,east of the old one. The plaintiffs, although in attendance at this trial, do not deny this. Donnell, an agent of the defendant Oil Company, testifies that about April 20, 1895, he drove a stake for another well location. Davis says he was present when the stake was driven, and that it was the 20th or 21st day of April, 1895. Connected with this fact is that stated by Frank Cooper, the saw-mill man, that between April 15th and 25th he placed lumber on the premises for a rig, etc., at the request• of the Oil Company. Donnell also says that in conversation with plaintiffs they told him that when they received the last one hundred dollars, they knew the old well was not producing gas. There is no denial of these facts, and they. are in harmony with the nature of things on the farm at that time. ,

But the plaintiffs, notwithstanding all this and the payment made, claim that the lease by its terms expired in December, 1894, because neither oil nor gas was then found in paying quantities, and it is argued for them, that if the term had thus expired, the payment of rental for the well for another year would not and did not work an extension of the old lease. As this is the vital point in plaintiffs’ controversy, we again look to the lease to see if such-is its construction. “The party of the second part, their heirs and assigns, to have and hold the said premises for the said purposes only, for and during the term of five years from the daté hereof and as much longer as oil or gas is found in paying quantities.

Does this language mean that it is only so long as gas or oil is found in paying quantities in the first well drilled, and that when it fails, the lease expires as to the entire premises? The whole premises are held by this lease for five years and as much longer as oil or gas is found in paying quantities. Not’found in paying quantities in one well, but found in such quantities when proper and reasonable search is made for it.

If this one well had ceased to produce gas within one year after the expiration of five years, would the lease have then expired,"'or could not the lessee develop, if he could, the same product on other parts of the premises ? He certainly could, because the finding of oil or gas implies all the requisite efforts to discover and produce it. Hence it is, that if the defendant, after the old well was exhausted in December, 1894, made reasonable effort to find oil or gas by further deepening and cleaning it, and otherwise treating it, as experience and skill should dictate, and failing there, made reasonably prompt effort to find it at other locations on the leased premises, and there found it in paying quantities, it-would be extravagant to claim that the lease had expired with the first well.

Then, did the defendant so neglect to exercise diligence in seeking oil and gas elsewhere on the lands as to amount to an abandonment of the lease? Efforts on the old well ceased about the latter part of February. A new location was staked on or about the 21st of April, and rig timber placed there about the same time. The annual rental for the old well, or some well, had been paid up to February 1, 1896, and in accepting the same, the plaintiffs recognized some right in defendants to go upon the premises.

It is true, the old rig was removed to another farm, and the gas well remained disconnected, all the tubing removed that could be drawn, part of the gas line removed — concede it all; but did not the new things that were done and attempted to be done, amply take their place, and more? But the title of defendants does not depend upon open, notorious, continuous, adverse possession, where the occupant, asa court has said in an old case, “must keep his flag flying. ”

Their continuous presence, actual or by symbol, on the premises is not essential, for such is not the source or character of their title, and their absence therefrom disclosed in this case, amounts to neither surrender or abandonment.

The plaintiffs say in their petition,“That said land every part thereof is supposed to be and probably is valuable oil land, and capable of producing oil in paying quantities.”

It seems unreasonable to so construe this lease, that it expired when the old well ceased production, without allowing to the lessee a reasonable opportunity to find it at other locations on the premises. Why not allow it to explore this oil producing land rather than a stranger ?

It was not over forty days from the giving up' of the old well until the new was selected and work begun. We cannot find that the lease expired; nor.can we find that defendants abandoned the premises. They abandoned the one well, but that is very far from an abandonment of the premises.

It has been Urged upon us by counsel that when the Natural Gas Company released to Blackford the thirty acres by him purchased from Mrs. Williams, one of the Blair heirs, that in law it released as to the entire premises. We cannot so regard it. The company was authorized to “sublet and subdivide” the entire lands. It could assign to another, part or all of its lease-hold. Nothing more was done in this case, and not as much was attempted.

Coming to the only remaining branch of this case, we find that Kelley and Harris took their lease on April 24th, 1895. This was after the payment for the year up to February 1, 1896. It is proven on this trial that Kelley testified in the lower court, that the plaintiffs had told him of this payment; and that he knew of the contract between the defendants already referred to. Prior to the date of their lease, the Oil Company had staked, a new location,and had part of the lumber on the ground for a new well. Hence Kelley and Harris are not innocent in the transaction, and their claim must abide the fate of plaintiffs’ case. We have considered the opinion of Judge Bentley of the Sixth Circuit cited by counsel for plaintiffs, as well as the case in the 40th American State Report. We do not disagree with these cases, but they stood on facts entirely different, and we must decide upon the facts peculiar to the issues before us. We find for the defendants. The injunction is dissolved and plaintiffs’ petition dismissed at their costs, for which there is judgment and the cause is remanded for execution for costs.

George H. Phelps and A. Blackford, for plaintiff.

M. F. Elliott and John Poe, for defendants.

M. P. Elliott and John Poe, for plaintiffs.

George H. Phelps and A. Blackford,,for defendants.

Another case was heard and submitted with the above. It is tne case of The Ohio Oil Company and The Northwestern Ohio Natural Gas Company against Maria Blair, Harriet Blair, et al. and Thomas C. Kelley and Carey C. Harris.

The same facts control both cases. The plaintiffs in this case set up their claim to the premises, and ask an injunction against Kelley and Harris to prevent their operations under their lease from Blairs made April 2i, 1895. We come to the same conclusion as to the rights of the parties. There is a finding for the plaintiff, injunction made perpetual. The answers and cross-petitiona are dismissed, and the clerk is ordered to cancel the lease to Kelley and Harris.


source: Caselaw Access Project

author: King, J.

license: Public Domain

text:
    (Sixth Circuit—Wood Co., O., Circuit Court
    April Term, 1896).
    Before Haynes, Scribner and King, JJ.
    JOSEPH REDFERN v. JOHN J. ULUERY, et al.

      Tender — A tender, to be valid, must be free from any 'condition to which the creditor may rightfully object.

      Same — Note secured by mm'tgage — Tender on condition that mortgage be cancelled — Where one of several notes secured by mortgage has been transferred by the holder of the mortgage, of which the debtor is aware, the offer of the whole amount of the indebtedness by the debtor to the holder of the mortgage, on condition that the release the entire mortgage, which he is unable and declines to do, and the deposit thereupon by the debtor of the amount in bank, to be paid to the creditor on demand, provided he produces the full release of the mortgage, which again the creditor declines to do on account of the fact that he is not the holder of one of the notes secured thereby, this is not such a tender as will relieve the debtor from any further liability for interest on the debt, and of costs of a suit brought on such debt.

      Error to the Court of Common Pleas of Wood County.
   King, J.

The plaintiff brought his action to recover upon a promissory note, dated April 1, 1891, payable on or before April 1, 1894, for the sum of $260.00 signed by the defendants John J. Uluery and John L. Van Eman.

The answer of the defendant avers that upon March 7, 1893, they tendered the plaintiff in payment of said note the sum of $290.16, being the amount then due thereupon, and that plaintiff refused to accept said sum or to surrender said note to the defendants, who have ever since been ready and willing to pay it.

There was a reply denying the tender and setting up special circumstances attending it. The trial resulted in a verdict for the plaintiff of $290.16, the amount claimed to have been tendered, and the plaintiff seeks to reverse that judgment because he claims he was entitled to recover the interest thereon after the time the tender is claimed to have been made, and up to the time of judgment, and also his costs. There are many exceptions to the evidence offered and to the charge of the court, but the principal question argued by counsel is whether the defendant made o.ut by his evidence the allegation of his answer relaiing to this tender. There is one further exception, relating to the misconduct of the counsel for the defendant. The defendant John J. Uluery, testifies that on or about March 7, 1893, he offered to the plaintiff the amount then due upon a promissory note. This amount, I should say, is not in dispute. It is conceded tobe $290.16. Defendant further testifies that, the plaintiff would not take the money, and he gave no reason that witness remembers of. On cross-examination, he testifies that he made the tender, and that plaintiff refused it, and then says that was all there was of it at that time. Further testifying, on cross-examination, he says, that there was more of it; that he, the plaintiff, was to cancel the mortgage, so far as he had any interest in it. Then again, he says he was to cancel the mortgage; also that he offered the money to the plaintiff on condition that he should give up the note and release the mortgage. And. on page 10, of the Bill of Exceptions, he testifies, that he never has been ready to pay the money except upon the condition that the plaintiff would release tüe mortgage. The undisputed testimony in the case further shows that on April 1, 1891, the defendants executed their three promissory notes of that date, payable on or before the 1st day of April, of the year 1892, 1898 and 1894, respectively, to the order of Esther A. Bushong,for $260.00-each. That while Bushong was the owner of the same, and before payment, she sold and transferred the notes to the plaintiff, and indorsed each of them: “Pay to the order of Joseph Redfern. Esther A. Bushong.” The evidence further shows that at the date above named, the defendants executed their mortgage upon certain premises, which recites that the consideration was $780.00, the face of the three notes, but the condition provides, that whereas the mortgagors have executed and delivered to the said Esther A. Bushong their four promissory notes of even date therewith, each for $260,payable in one, two and three years from date, with interest at six per cent. At the time of the transferring of the notes, the mortgage was also transferred to the plaintiff, and duly assigned in writing indorsed thereon, signed by the mortgagee. That some time after the purchase of the three notes, which the evidence shows are all that were in fact given, the plaintiff sold and delivered one of the notes to a man by the name of Shoup, but did not indorse it to him, and there is some evidence tending to show that the plaintiff was claiming payment from Shoup for the note so sold, and had not 'endorsed it to him because he had not been paid for it. This may be an inference from the testimony, rather than the testimony itself. However, there is testimony tending to show that the plaintiff notified the defendant Uluery, who is the principal defendant,not to pay the note toShoup, and there is some evidence tending to show that Uluery told the plaintiff that he should pay it, or rather that he should buy it, but the evidence is not clear nor undisputed that at the time when it is claimed the tender was made, that Uluery had paid and taken up the note. Thereupon,on the 7th day of March, 1893, nearly before the note by its terms became due and payable, he made';'the^tender, which he testifies to in the language referred to'above. As to that tender, it is clear from the evidence that the plaintiff refused to accept it. The evidence of the.ifplaintiff upon thq point iix question is not clear, but it is clear from-the testimony of a disinterested witness,McKee, that at the time when that ender is claimed to have been made, Uluery came into McKee’s office, and said: “I want you to count this money,” and laid down a package of money, wihch McKee counted and said to be $290.16. Uluery then said to the plaintiff, in the presence of McKee: “There is the money, and I want the note and the mortgage released,” and the plaintiff declined to accept it. Thereafter, and on March 9, Uluery having notified either McKee or the’plaintiff that he should deposit the money in the bank, McKee,under authority from the plaintiff, went to the bank on March 9, and offered to take the amount, $290. 16, and to release the mortgage, so far as the plaintiff’s claim was concerned. And the person in the bank, having control thereof,declined to pay the money or to accept such a release, or any release except a release of the mortgage in full. From this evidence it appears, as I have quoted most of it that is material, that the undisputed facts in the case were that the defendant^Uluery tendered the amount due upon the note at that date, coupled with the condition that the plaintifffshould deliver him the note and also the mortgageA-eleased,or give a release of the mortgage upon his property, and that this was .dedined, and that there was then, as the plaintiff knew, an outstanding note, which might or might not have been paid at the time. As to the payment of that note, the defendant says nothing further than that he bought it, implying that that he had paid less than was due upon it. He does not say that he had paid it, nor does he say that he told the plaintiff that he had paid it, nor did he produce the noteas evidence of his good faith in making the statement, but he says that he had bought it. It is claimed by the plaintiff that the defendant had no right to attach any condition to his tender whatever. I do not intend to go into a discussion of that question, as there stated. Although I think, on the whole, the law may be fairly stated to be, that a tender must be a free from any condition to which he creditor may rightfully object. Whether he might rightfully ob-' ject to cancel a mortgage and deliver it up at the time of the tender of .payment of the whole debt secured thereby, is a question that I will not discuss. It does not arise in this case. This tender unqualifiedly was accompanied by a condition. Had the plaintiff any right to object to fulfilling that condition? The outstanding note had been placed in circulation by him under a contract between him and the purchaser, which may or may not have been fulfilled; but the plaintiff was insisting that it had not been fulfilled. To that end, and for the purpose of protecting himself, he had not indorsed the note, and as the evidence shows, that the plaintiff notified the defendant not to pay the note, and that the defendant understood that plaintiff was claiming something on account of that note from the purchaser. Without any attempt on his part to satisfy the plaintiff that that note had been paid and taken up by its maker, he tendered^the money with his unqualified demand for the release of thejnortgage for the entire debt. We do not think that he was entitled to attach that condition to a tender,and that when so attached, it rendered his tender invalid, and the plaintiff was not bound to accept it. In other words, he might rightfully object to the cancellation of the mortgage, although assigned to him, when he knew that there was an out-standing note, about which there had been a dispute between him and the defendant, and upon which he was still making a claim against the assignee from him, and of the payment of which he had no positive knowledge. In other words, such a tender was not within the meaning of the law, as held by all of the authorities, an unconditional tender. For, I take it, that the words “unconditional tender”, as used in the cases, are not modified by any of the decisions, although some define these words differently. The strongest case cited for the defendant is in 118 N. Y. 165, and yet it goes.no farther than the general statement of the doctrine which I have already made, that the tender must be free form a condition to which the creditor may rightfully object. There are cases, many of them, holding that the maker of a note cannot insist at the time he makes a tender of the amount due, upon a surrender of the mortgage securing the debt; but as I have said, upon this point the decisions are not uniform, and that question is not fairly raised in this case.

A good many authorities have been cited to the court which have all been examined so far as they could be reached.

A case is cited from the 40th Michigan Reports page 614. In this case a mortgagee of chattels had taken possession under his mortgage, and sold a part of the property at a sale thereof; the mortgagor tendered payment of the mortgage debt on condition that the whole property be returned,and the tender was refused. The court held, that a tender is not good if made upon an impossible condition, or one which the person making it had no right to impose. So that case, in our judgment, does not support the claim of the defendant here, and is is an authority assisting the doctrine which I have already stated.

In tbe 41 Michigan Reports, at page 719, another case is cited by the defendant in error. The case arose upon -a demurrer to a complaint averring a tender of the full amount of the mortgage debt, and demanding an assignment of the mortgage. This tender and demand was made by a subsequent mortgagee. The court sustained the demurrer and dismissed the complaint, and the Supreme Court held that the complainant was entitled to put in his proof and have the case come up on the facts.

In the 45th Michigan Reports, at page 14,is another case, and it simply holds that a tender may be coupled with conditions such as the party has a right to make,and is entitled to prove the payment or tender of the amount legally due, and this case cites the two previous cases.

In the 53 N. W. Rep.,page 809 is a case also reported in the 52nd Minn., page 38 and it holds that a tender by a debtor to a creditor (who in good faith asserts that the amount tendered is .insufficient) is not good as a tender if it be coupled with a demand for the surrender of the notes. The case cited in the 48 N. W. Rep. and 32 Neb., page 40, was an action brought against the assignee of a mortgage to recover $40.00 actual damages and $100.00 penalty for failing to enter a release of the mortgage when the same was paid and satisfied and tbe defendant requested to release the same, and the sum allowed by law lor such release was tendered. This case arose under a statute of that state which provides that any mortgagee or his personal representative or assignee after full performance of the conditions of the mortgage, who shall for the space of seven days after being thereto requested, and after tender of his reasonable charges,refuse or neglect to discharge the same,shall be liable to the mortgagor, his heirs or assigns, in the sum of one hundred dollars damages and all actual damages occasioned by such neglect or refusal, and under that statute the court heid that such assignee was liable in that action for the actual damages sustained, which the jury had found to be the sum of forty dollars.

J. Blackford, Dodge & Canary, attorneys for plaintiff.

Troup & Dunn, attorneys for defendants.

None of these oases change or impair the rule as I have already stated it.

In this connection the court was requested to charge, and did charge the jury the following, being the third request submitted by the plaintiff:’ — '“The plaintiff had no right to release the mortgage as to any note which the plaintiff did now own, nor to any on which he did not receive payment. If the plaintiff did not own all the notes,she could not legally release the mortgage as to any note owned by another perón, and the defendant’s demand that he should release or be paid the $290.16 on March 7th, 1893, would vitiate the tender. ’ ’

We think that was a fair statement of the law applicable to the case, but the trouble in this case is, that the jury have disregarded that instruction. If they had followed that instruction, under the evidence in this case, they must have rendered a verdict for the plaintiff for the full amount due upon the note, which was agreed to be at the time of the trial of the case $321.72; for the case, as shown by the evidence, was just the case presented by that request to charge, and clearly “the jury did not follow that part of the charge of the court.

Having said this much, it follows upon the undisputed facts of the case, as fairly shown from the evidence, that plaintiff was also entitled to have given the sixth request, which the court refused, which is as follows: — “The court instructs the jury that on the evidence offered before you, your verdict should be for the plaintiff for the amount claimed by him in the petition, amounting to the sum of $320.00 up to the first day of this term of court.’’

Because the court refused to give that charge, and because the verdict is not supported by sufficient evidence, the judgment of the Court of Common Pleas will be reversed.


text:
    (Sixth. Circuit—Wood Co., O. Circuit Court
    April Term, 1896,)
    Before Haynes, Scribner and King, JJ.
    JOHN R. HANKEY, et al. v. PETER KRAMP.

      Gas and Oil Lease — What to he considered paying gas well—
    Where it is provided in the lease that the lessee shall pay $108 annually for every gas well as long as the same produces gas sufficient to justify marketing, and it appears that there were several! gas wells which the lessee had connected with its pipe line anti from which he sold gas, such fact is conclusive as to the right of the lessor to recover the annual rent of $100 for each of such gas wells so connected and used. And it is no defense on the part of the lessee that such wells did, in fact, not produce gas sufficient to justify marKeting, and that the amount of gas produced by them was not more than sufficient in quantity to run the wells on the leased premises, but that they had to use gas from wells on other premises to operate the wells on lessor’s land. The lessees might have used the gas produced from the wells on lessor’s land to operate the wells thereon ; but i£ they sold it, they are to be considered as choosing to treat these wells as producing gas in paying quantities, and they are liable for the payment of the stipulated rent therefor.
    Error to the Court of Common Pleas of Wood County.
   King, J.

In the Court of Common Pleas of Wood county Peter Kramp brought an action against John R. Hankey and others upon a written agreement to lease, which he claims to have made to the defendants for some of his lands, by which he granted to them the privileges and right to enter upon certain premises and mine for gas and oil.

One of the provisions of that instrument was, that should gas be found in sufficient quantities to justify marketing the same, the consideration in full to the party of the first part was to be one hundred dollars per annum for the gas from each well so long as it was sold therefrom. The lessees of this lease sold and assigned it, and the parties who acquired their interest, entered upon the premises and did mine for gas and oil, and in doing that, they drilled some gas wells from which gas was obtained.

They connected these wells with a pipe line which conveyed gas to the village of Bowling Green, being the line of The People’s Gas Company. They had other wells upon the line, and they marketed the gas from such wells as they had to the village of Bowling Green for some period of time.

The petition states that they marketed gas from the six wells in question, during the year ending December 19th, 1898, for which they became indebted, under the provisions of the lease, to the plaintiff Kramp in the sum of six hundred dollars with interest from December 19th, 1893,

The petition was filed some time after December 18th, 1893, — about the 5th of April 1891. There was an answer filed to the petition,in which defendants admit the ownership by the plaintiff of the lands; the execution and delivery of the lease or contract; that defendants took possession of the lands; that they drilled a number of wells; that there was a stipulation in the lease that if gas should be found in sufficient quantities to justify marketing, the consideration in full to plaintiff should be one hundred dollars per annum for the same from each well so long as the gas shall be sold; and they deny every other allegation in the petition.

They claim but one well did produce gas in sufficient quantities to justify marketing the same, and that gas was only sold from one well, and that they had offered to pay plaintiff for the one well at the rate of one hundred dollars per year, and they were all the time willing and are now willing to pay the one hundred dollars.

The case went to trial,and resulted in a verdict for plaintiff for five hundred dollars and some interest, the jury having found from the testimony that five of the wells drilled were producing gas, and that the gas was being used and marketed by the defendants.

Several errors are assigned.

It is claimed there was some evidence admitted that was improper, and that the court erred in its charge.

The only thing in the way of evidence that need be noticed is an exception taken to answer in a deposition. The witness was asked what he had been told by one of the defendants that he should say to the plaintiff if the plaintiff should ever ask him what the defendants were going to do about taking this gas, and the witness said that one of the defendants had told him he should say to the plaintiff something that might mislead him as to what they were about to do with the gas. We do not think that evidence was material, and cannot see how it tended to prove anything, yet we do not think it was so prejudicial to the defendants that this judgment should be disturbed on account of it.

The principal errors claimed are to the charge of the court. The evidence shows there were six wells drilled, and these six wells were connected and run into the pipes of the Gas Company, and through these pipes to the connections put in to furnish gas to the residents of the village of Bowling Green, and for probably a year before the commencement of this suit, in April 1894, gas had been furnished by these parties who were in the occupancy of these premises, to patrons in the village of Bowling Green, and they had sold quite a large amount of gas; and it was clearly demonstrated if there was any^gas at all flowing from these wells, that there was nothing to prevent it from flowing into the main pipe which supplied the village, and mingled with the other gas, if any, which the defendants owned.

If the wells produced no gas, there was nothing to flow into the main!¿pipe; but if the wells did produce gas, then it must be that it flowed into the main pipe, and it was upon that question that the|evidence hinged, and the plaintiff relied largely^’upon the fact that these wells were connected up, and so remained|for more than a year.

It was shown that they were not connected up on the 19th of DecenJber, but there was nothing to show that they were not connected on the 27th of December, a matter of ten days later. It was claimed by the defendants below that they must have been connected on the 19th, or else the plaintiff would not be entitled to recover for a year’s rental.

The court charged the jury upon that proposition, and this is complained of: ‘’that if the gas from these wells had been used for a year before the commencement of this suit, the plaintiff was entitled to recover for that year for any and all wells from wihch gas had been furnished in paying quantities for one whole year prior to the bringing of this suit;” and in the construction of this contract we concur. We think that was correct, and that a verdict and judgment rendered upon that theory would be a verdict and judgment upon the plaintiff’s right of action which had accrued to him up to the bringing of this action on the 19th of April, 1894.

The defendants submitted certain requests which were refused,and I will read two or three of them:

First — “The defendants are not bound to pay for gas used under the boilers in pumping the oil wells on plaintiff’s farm under the lease.

Second — The plaintiff cannot recover in this case for the year beginning December 19th, 1892, if no gas was sold from the plaintiff’s wells until after the 27th day of December 1892.” That I have referred to and disposed of.

Third — Even if the plaintiff might be under some circumstances entitled to recover pay for the gas used by the defendants in drilling and operating the wells upon his land, he cannot recover for the same in this suit under the clause providing for a rental of one hundred dollars per year for the gas sold from each well.” We think the court properly refused that one.

Now,as to the first request. There was some evidence to show, or it was claimed by the defendants, that while this gas was connected and run into the pipes which supplied the village of Bowling Green, there was not very much of it in quantity, and they claimed in fact that outside of one well there was not any more gas than would be sufficient to operate the wells themselves; and for the purpose of operating the machinery necessary to be operated on this lease, they piped gas from other wells which they owned on adjoining property, what is called the Wilcox well I believe, and that the amount which they so procured from all the wells was not more than sufficient to run their own, and that although they sold it, they ought not to be required to pay for it, since they had to furnish gas from other wells in its place to operate this lease. This is the ground of the first request. Upon that subject the court said: “If you find that gas from other lands was used upon the lands of the plaintiff as fuel for boilers, and the defendant took the gas from the lands of the plaintiff and marketed the same, and did this for one year or more prior to the commencement of this action, then your verdict should be for the plaintiff for the amount stipulated in fhe contract for such number of wells as you shall find gas was so marketed from. ”

The court said somewhere else that the defendants would have the right to use so much of this gas as these wells produced as was necessary to properly conduct the operations upon the lease, which we think was right. So that the theory upon which that question was submitted was, that though the defendants might have used the gas in their operations ■of plaintiff’s wells without paying for it, yet, if they elected to sell it, they would then be required to pay for it, and upon the theory that those wells were producing gas in paying quantities, and we think that is the correct construction of this lease. We think that though they might use this gas in operating the wells, that if they sold it, that should be considered an election on their part to treat this as a production of gas in paying quantities, which tney were then selling and marketing. I should say also that the court gave he fourth request asked by the defendants below which bore upon that point: —“If any of these wells did not produce any more gas than was used by the defendants in the reasonable use thereof for the operations of the wells on plaintiff’s land, the plaintiff is not entitled to recover for the gas from such wells.”

The court also said: “You have the right to consider what the defendants did towards marketing the gas, — ■ whether they connected the gas wells on plaintiff’s land with the line leading therefrom to the village of Bowling Green. Whether they sold and marketed the gis from wells, whatever number you may find in addition to the one that I have mentioned is admitted, for at least one year prior to the commencement of this action, and your verdict should be for the amount stipulated in this lease, one hundred dollars, that being the amount agreed on and provided therein should be paid.”

Then at the plaintiff’s request the following was given to the jury: “The fact that any well was connected with the line leading into Bowling Green so as to permit gas therefrom to flow into such line and be distributed to customers, is evidence tending to prove that gas was produced by such well in paying quantities. ’

Very serious objection is made to the giving of that request in connection with the charge which I have read as given by the court; that the court by that request, submitted one fact to the jury, and told them that if they found that to be true, that that would be evidence tending to prove that gas was produced by such well in paying quantities. It is argued that this is contrary to the decision of the Supreme Court. The court has said to the jury in its charge that they must find from all the evidence (and the burden of proof is upon the plaintiff) that these wells during all the period in question produced gas in paying quantities, and that the defendants sold the gas therefrom. Now, that was submitting the whole case to the jury upon the evidence.

The plaintiff by the request read asked the court to say to the jury, that if they found the fact to be that the defendants connected each of these wells with a pipe line that run from that field to a neighboring market,and which pipe line connected with customers who took and used gas during this period in question, that fact should constitute as. in paying quantities.”

Is it not true that if these parties have the option of taking this gas or of leaving it alone,and they see fit to connect those wells with a pipe line that furnishes gas to customers, why might not a court say that would be evidence tending to prove that those wells produced gas in paying quantities. I don’t see why it would not be conclusive evidence of that fact, and that a court might well charge the jury if they found that to be the fact, it would be presumed that the wells produced gas in paying quantities.

This charge is, that if such a fact existed, that these parties were using all the gas that these wells produced, and connecting it with their pipe line, that would be evidence that the wells were producing gas in paying quantities.

That they were selling it cannot be denied,and whether it was more or less, it was all going into their line.

"Why should the lessor be required to produce any higher degree of proof than that these defendants were piping this gas into the line for customers to take, and that the customers took and paid for it. For that reason I say I think the court would have been justified in saying that such fact would have been a presumption of the fact that these wells were producing gas in paying quantities, and that they were selling it, because the fact that they were selling it was not denied, and if that is so, then the court did not err in the charge it gave on that point.

Parker & Fries, attorneys for plaintiffs in error.

Troup and Dunn, attorneys for defendants in error.

Therefore we do not think there is any error in this charge, and affirm the judgment.


author: Haynes, J.

text:
    (Sixth Circuit—Wood Co., O., Circuit Court
    April Term, 1896,)
    Before Haynes, Scribner and King, JJ.
    WM. B. BRYANT, AS SHERIFF, v. WM. JOHNSON.

      Transfer by insolvent corporation of its propeH" in Ohio — Right of Ohio creditors to replevin the property here.

    Where an insolvent foreign corporation, doing business and having property in Ohio, transfers its property both in the state of its residence and in Ohio to one of its creditors a resident of the other state, - in satisfaction of an antecedent - debt, and such creditor takes possession of its property in Ohio, creditors of such corporation, resident in Ohio, having obtained judgments in Ohio against the corporation on their claims, cannot have such judgments levied on the former property if the corporation in possession of its transferee on the claim that such transfer by the insolvent corporation in preference of one of its creditors is void under the decision of the Ohio Supreme Court in Rouse vs. Merchants National Bank, 46 Ohio St. 493. Such transfer is not void, but voidable only, and the remedy of the Ohio creditors would be to treat such transferee as a trustee for the benefit of all the creditors, and to invoke the power of a Court of Chancery in aid of the trust.
    Error to the Court of Common Pleas of Wood County.
   Haynes, J.

The petition in this case is presented to reverse the judgment of the Court of Common Pleas in a case of replevin. The facts are, there was a corporation existing in the state of Pennsylvania known as The High Explosive Company, engaged in the business of shooting oil wells, and also owning certain material, shooting outfits and equipment.

This company carried on business in Pennsylvania, Ohio and Indiana. On a certain day they became insolvent, and took steps in the state of Pennsylvania to make a conveyance to one William Johnson of all their property in Ohio and Indiana. Johnson took possession of the property in Ohio, and thereupon certain creditors of the concern having obtained a judgment against it, caused a levy to be made by William B. Bryant, as sheriff, upon the property in question in the hands of Johnson as the property of the corporation.

That afterwards the property was replevined from the sheriff. A trial was had,and judgment rendered in favor of •Johnson.

The question submitted to ns on this state of facts is, inasmuch as the corporation was insolvent, and known to be such, whether trustees of the corporation had any authority whatever to transfer this property to Johnson in payment upon a precedent debt,assuming, as it is claimed, that under the decision in Rouse, trustee, v. Merchants’ National Bank, the transfer was void, and that the property belonged to the corporation, notwithstanding the alleged transfer to •Johnson.

The corporation is a Pennsylvania corporation; transfer was made in Pennsylvania, and while the law of Pennsylvania is not shown us, it is assumed that the law of Pennsylvania is the same as the law . of Ohio, and the law of Ohio would govern as to the transfer of the property lying in the ¡state of Ohio.

Now, the case of Rouse, trustee, v. Merchants’ National Hank is too lengthy to be read here, but the syllabus, which is found in the 46th Ohio State Reports at page 493, reads as follows: — “A corporation for profit, organized under the laws of this state, after it has become insolvent and ceased to prosecute the objects for which it was created, cannot, •by giving some of its creditors mortgages on the corporate property to secure antecedent debts without other consideration, create valid preferences in their behalf over other creditors, or over a general assignment thereafter made for the benefit of creditors.”

The court in a very lengthy and learned opinion established by authority and by principle the fact that the trustees of a corporation created for profit hold the property in trust, and that they hold it in trust for the creditors, and especially when the corporation becomes insolvent do they hold it in trust for the creditors, and they cannot without fault undertake to prefer one creditor over another; because holding it for all the creditors, they hold it upon the principle of equity which requires that it shall be sold and the proceeds applied for the equal benefit of all the creditors.

Now, assuming that to be the law, and the position occupied by these trustees, it follows that the preference to Johnson would be invalid. The contention of counsel is that this transfer is void,and that the property still remains the property of the corporation, and it still remaining the property of the corporation, he has a right to levy upon that property, and subject it to the payment of this judgment. We are unable to agree with counsel in that respect.

We see nothing in this dcision to hold that that transfer is void. It is voidable, but not void.

More properly speakiixg, Johnson takes that property subject to the trust placed upon it by law; subject to the right of the creditors to have that property subjected to the equal payment of all the creditors of the firm. Possibly he takes it in such a way that the provisions of Section 6344 of the Revised Statutes would reach it. But if we were to allow the claim of the plaintiff, we would be found in this position: that while Johnson could not take the claim of plaintiff in payment of the debt, yet another creditor might take the whole property in payment of his debt, because he takes it by the operation of a judgment and levy.

That is, if we find this case in favor of Bryant,sheriff, we would simply turn the property over from one creditor to another, and thus defeat all the other creditors from receiving any portion of the same on their claims.

George Phelps, attorney for plaintiff.

Albert Zugschwert, attorney for defendant.

We therefore hold, as between these parties, Johnson and the judgment creditor, that Johnson had a right to hold this property, and he had the right to hold his judgment, if he ever had one, in the Court of Common Pleas.

Under our view the proper way to have reached this would have been to invoke the power of a Court of Chancery in aid of the trust.

The judgment of the Court of Common Pleas will ther'fore be affirmed.


author: Day, J.

text:
    (Third Circuit—Defiance Co., O., Circuit Court
    March Term, 1896.)
    Before Seney, Day and Price JJ.
    THE STATE OF OHIO, ON THE RELATION OF J, J. AUSBERRY v. JOHN W. SLOUGH.

      Prosecuting Attorney — Appointment to fill unexpired term—
    1. The tenure of an appointee to a vacancy in the office of Prosecuting Attorney of a county, is not for the unexpired term, but is only until a successor is elected and qualified. Sec. 11 R. S.

      Same — When election to fill vacancy to take place — ■
    2. A successor should be elected at the first general November election occurring, under the provisions of law, more than thirty days after the occurrence of the vacancy ; and where a vacancy in the office of Prosecuting Attorney occurs September 13, the general November election, which is held on the fifth of November following, is a “proper election” for the choosing of such successor. Sec. 11 R. S.

      Omission in bond — ■What not fatal — ■
    3. The omission from the official bond of a Prosecuting Attorney of of the condition, provided in Sec. 1269 R. S. that he shall “pay over, according to law, all moneys by him received in his official . capacity, ” is not a fatal or serious defect. The omission is cured by the provisions of Sec. 7 R. S.

      In Quo Warranto.
   Day, J.

This is a proceeding in quo warranto, instituted by the relator, J. J. Ausberry, against John W. Slough, respondent, the object and purpose of which is to procure a judgment and order of this court ousting respondent from the office of prosecuting attorney of Defiance county, and inducting the relator into said office.

From the petition, answer and reply, and certain admissions or agreements of fact, made by the parties on the hearing, we glean the following as the undisputed facts of the case: James B. Woods was the regularly elected, qualified and acting prosecuting attorney of Defiance county, his term beginning the first Monday in January, 1891, and continuing, by statutory provision, until the first Monday in January, 1897. On September 13, 1895, Woods died, and on that day there occurred a vacancy in said office. The vacancy occurred more than thirty days before the general election of that year, which general election took place November 5, 1895. The relator became a candidate for said office, for the unexpired term of Woods, and with others was balloted for, for that office, at said general November election, by the electors of the county. The relator proved the more popular candidate, received the highest number of votes cast for said office, and was duly elected thereto. He was promptly in receipt of a commission signed by the Governor, attested by the Secretary of State, under the great seal of the state. The commission was in due and proper form, and authorized the relator to do and perform, all and singular, the duties of prosecuting attorney of Defiance county, Ohio, for a term of three years. Relator gave bond in a sum fixed by the probate court, with approved sureties and conditioned as the law provides, except, there was omitted from the bond the condition: “And pay over, according to law, all moneys by him received in his official capacity;” was sworn as such officer, and on the 6th day of January, 1896, presented himself at the office of the prosecuting attorney of Defiance county, and demanded the properties and rights appertaining thereto, of respondent John W. Slough, who was in possession of said office and exercising the rights and powers thereof, and was refused by Slough, who declined to vacate or yield possession to the relator. In November, 1895, after commission was issued to relator, Slough was appointed to said office, by the court of common pleas of said county, to fill a vacancy in said office of prosecuting attorney, which the said court found to exist at that time. Slough at once qualified by giving a proper bond, was sworn as such officer, and immediately entered upon the discharge of the duties of the office, and still continues to exercise the office, and proposes to continue to exercise it, to the exclusion of the relator, until the first Monday in January, 1897, if allowed to do so. Relator and respondent are each, at least, twenty-one years of age, citizens of the county, attorneys at law, and eligible to the office of prosecuting attorney.

These gentlemen are, no doubt, in the utmost good faith in the matter, each believing himself entitled to have and enjoy the office of prosecuting attorney of Defiance county, with his claim of right based on the solid rock of justice and law; but one of them is mistaken, clearly so, for, as the law now is, both cannot be the prosecuting officer of Defiance county, at the same time. Only one of them is entitled to act in that capacity, and our problem is, to ascertain and declare which one- — -the relator, by virtue of his election by the people, or, the respondent by reason of his appointment by the comomn pleas court?

Counsel for the relator suggests, in argument, that no vacancy in fact existed at the time the appointment of respondent was made, for the reason that the vacancy had been filled by an election by the people, prior to the time the order of appointment was made; and that because of this, the appointment was without warrant of law and void, and that respondent is not entitled, even, to pose as a good faith occupant of the office by appointment to fill a vacancy, but is a usurper, and should be summarily termed such.

This suggestion seems foreign to any issue in the case, and whether approved or not, does not aid the relator in any way, since he must prevail, if at all, upon the strength and validity of his own right, and not upon the weakness and invalidity of that of his adversary. The suggestion, however, is met by the counter one that there was, because of a lack of diligence on the part of the relator in failing to promptly qualify, or, in failing to advise the court of his readiness to act, an apparent vacancy, upon which the court took action; that Slough was designated by the court, and acted as prosecuting attorney, discharging the duties of the office, in fact, during a term of the court, so that de facto, if not de jure, he was and is the prosecuting attorney of the county, by appointment of the common pleas court, to fill a vacancy in virtue of the provisions of law. In view of these suggestions, and to obviate complication in the future, or, possible suggestions inimical to the public interest, we assume Mr. Slough’s appointment was properly made, in accordance with the provisions of section 1270,Rev. Stat., and regard him as a bona fide occupant of the prosecutor’s office, by appointment, and entitled, in this proceeding, to make claim of any right or benefit belonging to that position.

Both, relator and respondent, rely on the provisions of section 11, Revised Statutes, as justification of the claim put forth. That section is directly applicable and governs the case, Section 11, Revised Statutes, provides: “When an elective office becomes vacant, and is filled by appointment, such appointee shall hold the office till his successor is elected and qualified, and such successor shall be elected at the first proper election that is held more than thirty days after the occurrence of the vacancy,’’ etc.

The relator appeals to the provisions of this section of the statutes, and claims that his election by the electors at the general election of November, 1895, was in accordance with its provisions — was a proper election for prosecuting attorney, it being the first one, and occurring more that thirty days after the happening of the vacancy, and that he is entitled to the office. Respondent appeals to the same section, and asserts the election of November, 1895, was not a proper one"for the election of a successor to the deceased prosecutor, Mr. Woods, within the clear meaning of its provisions; and because not a proper one, the relator is not entitled to the relief he seeks. The claim is made for respondent, in substance, that under the provisions of law, there can be no election in Defiance, or any county in the state, to fill a vacancy in the office of prosecuting attorney. That a proper construction and correct rendering of the phrase, “first proper election,” in this case, would refer to the first November election occurring before the expiration of the term for which James B. Woods, deceased, was elected, and would be the November election of 1896; and meanwhile, the balance of the unexpired term of Wood must be filled by the appointee of the common pleas court.

We think the position taken by respondent is not tenable. The construction contended for by him is an extreme and very strained one, and not at all suggested or warranted by anything in the wording of section 11, or the evident purpose of its enactment, or the connection in which it is to be considered and applied; and if allowed would render nugatory the entire section. Section 11, it will be observed, is general in its provisions, and, by its terms, evidently intended to apply to vacancies in all elective offices where express provision is not made, and provides a method or rule by which all such vacancies must be filled. It is the only general provision of law on the subject, and is so framed that it directly covers the ground and supplies a rule of filling vacancies to be considered and applied in connection with the provisions of the various sections of the statutes-, having reference to the election of officers, whether the-time of election provided is the annual November or April election, or a special election. Section 2978, Revised Statutes, provides: “Elections for state officers, county officers, including prosecuting attorneys, shall be held on the first-Tuesday after the first Monday in November. Other sections provide that certain officers shall be elected at an annual April election. Other laws there are, providing additional common pleas judges in a number of the sub-divisions, and providing for elections, some in April and some in November. An Insolvent Court of Hamilton county has been created and election provided for on the second Tuesday after the second Monday in November. Now, the provisions, of Section 11, were intended to meet the requirements and. exigencies as to vacancies in office likely to arise under any and all these various laws. This intent seems manifest from the use of the words “proper election,” in formulating the-section. Placing this construction on the section, and bearing in mind the purpose to be served, the problem here presented seems easy of solution. Indeed, the section itselff in very plain terms, furnishes the solution. It not only clearly and definitely declares and fixes the tenure of the-appointee to the office, but it as clearly and definitely declares and fixes the time at which the vacancy shall be filled, by an elcetion. The tenure is not for the unexpired term; and, an election to fill the vacancy is provided for in advance-of the expiration of the full term. Says the section: “Such appointee shall hold the office till his successor is elected and qualified.” And “such successor shall be elected at the first proper election that is held more'than thirty days; after the occurrence of the vacancy.”

The Supreme Court, in the case of State v. Barber, 45 Ohio St. 847, uses this language: “The words ‘first proper election,5 mean the first regular recurrence of that election at which the officer, whose successor is to be chosen, was elected; that is, the first election occurring, appropriate to that particular office, under the law regulating elections to that office.” Applying this statement of the law to the case at bar, the words “first proper election, etc.,” mean, in this case, the first election at which, by the provisions of law, it would be proper to vote for and choose a prosecuting attorney for the county of Defiance; and is the first annual November election that is held more than thirty days after September 3*1, 1895. We conclude the general election held on November 5, 1895, was a proper one at which to choose a successor in the office of prosecuting attorney of James B. Woods, deceased.

The omission from the official bond of the relator of the condition requiring him to pay over all moneys received by him in his official capacity, is not a serious defect. By giving the bond and taking the oath required, the relator qualifies fully. The defect, or omission, is cured by the express provisions of Section 7, Revised Statutes.

No commission was issued to Mr. Slough, and the one issued to Mr. Ausberry authorized him to exercise the powers and duties of the offico for a full term of three years, instead of the unexpired term of Woods, deceased. Neither of the facts are deemed of consequence in the disposition of the case. Notwithstanding them, the election of Ausberry, it is believed, was regular, fair and lawful. The sovereign electors of the county, in the exercise of their undoubted right, and in accordance with the provisions of law, selected him to be the prosecutor for the county. Their will thus lawfully made known is to be respected and enforced.

The election of Ausberry ended the vacancy to which Mr. Slough was appointed, and in that respect his occupation is gone. He has no warrant of law to exercise the office longer. Mr. Ausberry, being duly elected and qualified, is entitled to act in that behalf.

Hubbard & Hodman, for the relator.

B. B. Kingsbury, for respondent.

There will be a judgment of ouster against the respondent Mr. Slough, and an order inducting the relator into office as prayed for in the petition.

Mr. Slough is required to pay the costs of the proceeding.


author: Caldwell, J.

text:
    (Eighth Circuit—Cuyahoga Co., O.,Circuit Court
    Jan. Term, 1896.)
    Before Caldwell, Hale and Marvin, JJ.
    WILLIAM H. GAYLORD, et al v. R. S. HUBBARD, COUNTY TREASURER.

      Constitutionality of statute — Valuation of property for taxation—

    1. The adoption of different methods, and different agencies, indifferent parts of the state, for the valuation of property for taxation, is an authorized mode of ascertaining “its true value in money,” and infringes no provision of the constitution.
    2. The act passed April 13, 1892, (89 O. L. 283) to provide for the appointment of a board of equalization and assessment in cities of the first class second grade, is not in conflict with Article II, Section 2G, providing that “All laws of a general nature shall have a uniform operation throughout the State ;” nor with Article XII, Section 2, which provides that “Laws shall be passed taxing by a uniform rule, all property according to its true value in money. ”
    >3. Section 5 of said act makes the average valuation of real property by the.decennial assessment the standard with reference of which the Board may in any year raise or reduce the valuation of lots and tracts.
    4. Said Board may lawfully raise the valuation of real property, without personal notice to the owner thereof.
    Appeal from the Court of Common Pleas of Cuyahoga County.
   Caldwell, J.

This case is here on appeal from the Common PleasCourt. The plaintiff's say, that they should have an injunction against defendant, to enjoin him fom collecting certain taxos on their real property, because said taxes are assessed without authority of law. They do not ask to have the entire taxes restrained, but only that portion resulting from what they clcaim is an illegal increase of the taxable value of their property. The value of the property was increased by the board created under the statute, 89, O. L. 283. The board under this statute increased the taxable value of all the real property of the second ward of Cleveland ten per cent. It is claimed by the plaintiffs that this was illegal, first, because the board acted without personal notice to the owners; and second, because the law, 89 O. L. 283, under which the board was created and acted, is unconstitutional, because it violates two provisions of the constitution of the state of Ohio; first, Article 2, Sec. 26: “All laws of a general nature shall have a uniform operation throughout the State.”

Second, Article 12, Sec. 2: “Laws shall be passed, taxing by a uniform rule, all moneys, credits, investments in bonds, stocks, joint stock companies, or otherwise; and also all real and personal property, according to its true value in money.”

This case was tried upon an agreed statement of facts; and we think that the agreed facts show that the plaintiffs all had actual notice of the action about to be taken by the Board, and of which they now complain. Even if this is not so, the law under which the board acted does not require notice, and the board could act without personal notice. The facts show there was published notice. No claim is made that the board acted unwisely, or without sufficient cause.

In determining whether the law is unconstitutional, it becomes important to see what powers are conferred on the board. Section 1 povides: “That in cities of the second grade of the first class there shall be a board of equalization and assessment, to be composed of three members, electors of said city, not more than two of whom shall belong to the same political party This board is denominated a Board of Equalization and Assessment, There is no complaint in the petition in regard to the appointment of the board; or that they were not suitable; nor is there any complaint against their exercising the powers conferred upon them in this statute, except as to the powers enumerated in section 5,

Section 7 provides: “The decennial assessment of real estate to be made in the year 1900,and every tenth year thereafter, as provided by law, shall, in cities of the second grade of the first class be made by said board” And the section further provides how they are to proceed to make the assessment. This section is the only one contained in the statute for this board to act as an assessing board. All its other powers pertain to equalization.

Section 5 provides: “As soon as practicable after the first Monday of May, 1892, and annually thereafter, the said board shall proceed to hear complaints and to equalize the valuation of all real property in such city, and it shall have the power to raise the valuation of such tracts and lots of real property as in its opinion are valued below the true value thereof, and to reduce the valuation of such tracts apd lots as in its opinion are valued above their true value, as compared with the average valuation of the real property in such city, and it shall have all the powers provided by law for decennial county boards for the equalization of real property, and shall be governed by the rules prescribed for such decennial county boards in equalizing the valuations returned by district assessors; provided, that it shall not reduce the value of the real property of the city below the aggregate value thereof as fixed by the state board of equalization, nor below its aggregate value on the duplicate of the preceding year, to which shall be added the value of all new entries and new structures, over the value of those destroyed as returned for the current year.”

This statute means, we think, that this board is to act as a decennial county board for the equalization of real property, and in doing this, must be governed by the rules prescribed for such decennial county boards. It means further, that in any other year than the decennial year, the board may hear complaints, and may equalize the valuation of real property in the city of Cleveland; and it may raise the value ■of any parcel or parcels, if in its opinion they are valued below the true value thereof, and to reduce the valuation of such tracts and lots as in its opinion are valued above their true value. But this true value is determined by the ■average valuation of real property in the city as fixed by the -decennial valuation, so that in fixing any different value upon any parcel or parcels of land, in any other year than the decennial year, the board must take as the standard of value, the valuation determined upon in the decennial year. The statute reads that this true value that property is to be placed at is to be determined by comparing it with the average valuation, not the average value of real property in the city; which we think means the decennial valuation.

We are of the opinion that this statute is general, and we will not undertake to go through with the many decisions that have been cited from our Supeme Court in this ■case, to analyize and show upon what we base our opinion. The statute is so much like many others that have been classified as general statutes by the Supreme Court, that an extended analysis and examination of the cases is not necessary at this time.

The next question is, does this statute violate the provision of the constitution as provided in Article 12, Sec. 2, that: “Laws shall be passed, taxing by a uniform rule, etc. 'The law is well settled in this state, as appears from Wagner v. Loomis, 37 Ohio St. 571; and State ex. rel. v. Jones, Auditor, 51 Ohio St. 492, that this constitutional provision does not extend to the mode and manner that the state - may provide for the assessment of property and the equalization thereof, nor the manner of collecting the tax; and there is nothing in the constitution which requires property to be taxed according to the same per cent; and the equality required by the constitution has no other test. This is the doctrine laid down in these cases. It is impossible to arrive at an exact equality in the levying of taxes. Any system, or any provision of law, that substantially carries out the purposes of the constitution, should be upheld by the courts.

We find, then, that the law provides different agencies for equalizing taxation. The counties have one provision; the City of Cincinnati has another, and this city has still another. And if substantial equality is maintained under these several provisions, there can be no legal objection to any of them.

One objection, the only one that could possibly be urged against section 5 of the statute under consideration that cannot be urged against other boards for equalizing, increasing and decreasing value, is, that the board provided for in section 5 may raise the value of such tracts as in its opinion are valued below the average valuation of other property, and may reduce when, in its opinion, any property is too high as compared with the average valuation; and this average valuation is, as we have said, a decennial valuation. The other boards have the power, whenever it is made to appear to their satisfaction, to increase or reduce the valuation of any real estate, if there is gross inequality between its value and the average value of other property asdetemined by the decennial equalization. The difference between these provisions is very slight, if any. In the one case, if property is too low or tco high, according to the standard, the board can act. Under the other provisions, the board can act when there is gross inequality.

As we have already said, exact equality, while within the intent of the law, is scarcely possible in its ‘actual operation,and it is the meaning of section 5, that the board shall act only when the valuation is clearly above, or clearly below the established average valuation; and the difference between this meaning and that of- gross inequality may be slight. But the statutes, in our opinion, in their provisions, provide substantially the same rule for equalizing the valuation of property, It follows, that there is no power conferred upon the board by section 5 of the statute under consideration that is not conferred upon other boards performing like duties.

Burke & In-f/ersolls, for Plaintiffs.

P.'S. Kaiser, and M. G. Norton', Phillips, Ford & Crowell, for- Defendant,

This being true, a faithful execution of the provisions of these different statutes would place upon the duplicate for taxation the real estate according to its true value in money, or substantially so, and the equality required by the constitution would be fully complied with.

“In determining whether an act of the legislature is or is not in conflict with the constitution, it is a settled rule, that the presumption is in favor of the validity of the law”, 51 Ohio St. 503. The presumption therefore is, the difference between the statutes being so slight, that the legislature supposed it was providing a uniform rule; substantially the same rule for Cleveand that it has provided for other parts of the state.

We think the law is constitutional. The injunction is not allowed, and the plaintiffs’ petition is dismissed.


author: Smith, J.

text:
    (First Circuit,—Hamilton Co.,Ohio Circuit Court,
    April Term, 1896.)
    Before Swing, Cox and Smith, JJ.
    MARGARET BAKER v. SPEYER & CO.

      Chattle mortgage given on goods bought on the installment plan, is subject to the provisions of the act of May 4, 1885, (Rev. Stai7913-73) — Mortgagee before attempting to repossess himself of the goods must return the money paid thereon, less reasonable amount for their-use.

      C. C. Benedict, for Plaintiff in error.

      Outcalt, Granger & Htmi, contra.
   Smith, J.

This case raises the question whether, when one purchases goods o.n the installment plan, and simultaneously executes', a, mortgage thereon to the seller to secure the deferred payments of the purchase money, and makes substantial payments thereon, but afterwards makes default as to other of the payments, the seller in accordance with the terms of the mortgagee, may legally take possession of the mortgaged property without complying with the provisions of Section 2 of the act passed May 4, 1885, (S. & B.’s Rev. Stat., 7913-73), by tendering to the purchaser the sum or sums of money so paid, after deducting therefrom a reasonable compensation for the use of such property, which shall i» no case exceed fifty per cent.of the amount so paid; that is, whether a transaction of this kind, when a mortgage is given,, comes within the letter or spirit of this law.

We understand that the Supreme Court in the decision of the case of the Singer Manufacturing Company vs. Caldwell (35 Law Bull., 375), affirming the decision of the? Circuit Court of Jefferson County, upon the grounds stated in the opinion of that court (7 C. C. 460), has held that it does. The question was properly raised in this case by exception taken to the rulings of the court directing the jury t» return a verdict for the plaintiff below, Speyer & Company, and in refusing to charge the jury as requested by defendant’s counsel on that point.

The judgment will be reversed, and a new trial awarded.


author: Swing, J.

text:
    (First Circuit—Hamilton Co., O., Circuit Court,
    Jan. Term, 1896.)
    Before Smith, Swing and Cox, JJ.
    W. M. AMPT v. CITY OF CINCINNATI et al.

      Constitutional Law — Cincinnati Water Works act.—

    1. The act of the legislature passed April 24, 1896 (93 O. L., 606), authorizing cities of the first class, first grade, to build waterworks and to issue bonds to the amount of not more than 86,500,000.00 for that purpose, if necessary, is constitutional.

      Law of General Nature — Definition—

      2. Whenever any law directly operates upon and affects the rights, privileges and interests of the citizens, and there is no reason why it should not operate on all the citizens of the state alike, it is a law of a general nature. But wherever a law relates to the government of cities, and only indirectly affects the citizens, it is not .a general law within the meaning of this section, although the subject matter, if applied to any portion of the state other than classified cities and incorporated villages, would be a law of a general nature.

      City contracting with private parties to build waterworks for its use — Constitutional Law.—
    3. An act authorizing a city to contract with private parties to build water works for its use, with the privilege of purchase by the city at any time, is not in conflict with sec. 6, art. 8 of the constitution of Ohio.
    On appeal from the Court of Common Pleas of Hamilton county.
   Swing, J.

These cases all involve the same question, and were brought to test the constitutionality of the act of the Legislature, passed April 24, 1896, 93 O. L,, p. 606, generally known as the waterworks bill.

This act, in brief, provides for the building of waterworks for cities of the first grade of the first class, and that bonds may be issued by said cities, to the extent of $6,500,000.00, if necessary for the completion of the same. The works are to be built for said cities by a Board of Commissioners appointed by the Governor of the State. These 'Commissioners are given full and complete control over the building of the works, and, when completed are to turn the same over to the officers of said cities having charge of the water-works. The Commissioners, under said act, have the power to .let the1 contract for the building of the works as an entirety or otherwise, as they may deem best, or the may contract for the building of the entire plant, and lease the same from the builders for a period of forty years, with privilege of purchase every ten years. The Commissioners may issue the bonds of the city to the extent of $6,500,000.00 for the building of the works,for which the plant itself is pledged, as well as the credit of the city.

. It is claimed that the law is unconstitutional upon several '.grounds:

First — That it is a law of general nature, and does not have a uniform operation throughout the state, and, therefore, violates sec. 26, art. 2, of the constitution..

There can be no doubt but that such a claim.might well be made upon the language used by the judges in the body of the opinion in the case of Hixson v. Burson, 35 Bull. 280; but we do not think the claim is supported by the syllabus of that case, which is the law of the case. But whatever doubt the language of the opinion in that case may have produced in the minds of judges and lawyers as to this question, we think has been dispelled by the recent decision of the Supreme Court in the following cases: State ex rel. Attorney General v. Baker, 35 Bull., 381; Hayes & Sons v. The City of Cleveland; Seifert et al. v. Weidner et al., and others, found in 35 Bull., 399.

These cases clearly show that the’ Supreme Court did not intend, in the Hixson case, to overrule a long line of cases of that court in similar cases to the one here in controversy.

They .uphold the classification of cities, and all laws which may apply to all cities of the same class are constitutional, provided the subject matter of the law is a proper .subject for classification. What matters are proper for classification has not yet been determined by our Supreme Court. In the case of McGill vs. The State of Ohio, 34 Ohio St., 238, Judge Boynton says: “The term ‘law of a general nature,’ as employed in the constitution, has not as yet Teceived from this court an authorative definition, and none will be^attempted in the present case. The annunciation of the principles that govern each case as it arises is the better mode of arriving at its proper meaning and effect,”

In that case the court held that a law regulating the selection of jurors for the courts of Cuyahoga county, was not a law of a general nature within the meaning of Sec. 26, Art. 2, of the constitution.

In the case of the city of Cincinnati vs. Steinkamp, 35 Bull. 185, the Supreme Court decided that a law which provides that in all cities of the first grade of the first class (Cincinnati), buildings of three or more stories in height, not used for private residences exclusively, should be provided with fire escapes, was one of a general nature, and not having a uniform operation, was contrary to said section of the constitution. The'court, at page 187, says: ■“The suject of the statute under consideration is the protection of persons from the danger of fire. Protection of life and limb, it would seem, is not a local matter, but is a matter of general public interest, in which every person in the state coming within the category of people exposed to the dangers intended to be guarded against,is equally interested with every other such person, and it would appear to be as much the duty of owners of buildings answering to the description as to construction and occupancy of those named in the statute, to observe the humane directions of this act, whether located in one part of the state as another,”

In this case the court, as was said in the McGill case, supra, says: “It is not intended by this holding to overturn earlier decisions of the court upon kindred questions. Each case stands, and must stand, upon its peculiar facts and circumstances.”

The Supreme Court,in the case of Falk, ex parte 42 Ohio St. 638,decided that a law which provided that ‘‘any person found in a city of the first grade of the first class, or within four miles of the corporate limits thereof, having in his possession any burglar’s tools, shall be deemed guilty of misdemeanor,” was a law of a general nature, within the meaning of Sec. 26, Art. 2, and, not having uniform operation throughout the state, was unconstitutional. Judge Okey, quoting from the decision of Judge Thurman, in Cass vs. Dillon 2 Ohio St. 607, says ‘‘The origin of this section is perfectly well known. The legislature has often made it a crime to do in one county,or even township, what it was perfectly lawful to do elsewhere, and had provided that acts even for the punishment of offenses should be in force, or not, in certain localities, as the electors thereof respectively might decide. It was to remedy this evil and prevent its recurrence that this section was framed.” In speaking of the act in controversy, the court proceeds to say: ‘‘It is not merely immoral, but plainly vicious; it is one of a very serious and dangerous character; it is not merely malum prohibitum, but malum in se, and it is a wrong to society, ■ not merely in Cincinnati, not merely in cities, but in every county, in every township, in fact, in each and every part of the state, and no reason can be given why it might not properly be made punishable by statute throughout the whole state as a criminal offense.”

Other cases of the Supreme Court might well be cited upon this question, but they do not conflict with these. These cases clearly show the view taken by that court of this provision of the constitution; and, while in each of these cases they say that they will not laydown any general rule as to its meaning, but will reserve to itself the right to pass on every law as it comes before them, it seems to me that there is a rule deducible from these decisions, and that is, that whenever any law, directly operates upon and affects the rights, privileges and interests of the citizen, and there is no reason why it should not operate on all the citizens of the state alike, it is a law of a general nature within the meaning of this section of the constitution, and it should have a uniform operation throughout the state. But wherever a law relates to the government of cities and to the doing of corporate acts by said cities, and only indirectly affects the citizen, it is not a general law within the meaning of this section, although the subject matter, if applied to any portion of the state other than classified cities and incorporated villages, would be a law of a general nature. Such construction seems necessary in order to give effect to Sec. 6, Art. XIII, of the constitution. But whether we are right in this inference or not, we think there can be no question but what, under the recent decisions of our Supreme Court, supra, this law does not come within the inhibition of the constitution as to being a law of a general nature.

It is claimed that the law violates Sec. 1 of Art. XIII of the constitution, which provides “The General, Assemly shall pass no special act conferring corporate power.” And, in favor of this contention, the case of Herrmann et al. vs. The City of Cincinnati, 9 C. C., 357, is cited. In that case we held that the law under consideration was special, and that it conferred corporate power, for the reason that by its terms it related to the city of Cincinnati alone, and that by no possibility could it apply to any other city.

The present law, no doubt, under the ruling of our Supreme Court, confers corporate power; but we do not think it is special within the meaning of this section. At the time of the passage of the act, the only city that was expected to be affected by it, was the city of Cincinnati, but its terms are general. Any other city which might come within the classification could avail itself of its provisions. It clearly comes within the language of the court as stated in Marmet vs. The State, 45 Ohio St. 66: “Tne law is not a special act. It is local and special as to the ends to be accomplished, but general in its terms and operation, applying to all cities o£ the first class. It is not limited to such city as may have been in that class and grade at the date of its enactment. At that time Cincinnati was the only city in the state answering to the description, but there is a possibility,not to say certainty, that other cities in the state will increase in population, so that they will pass into this grade, and when that happens, they will come within the provisions of this law. In this respect, the law differs essentially from that in review in the case of The State vs. Mitchell, 31 Ohio St. 592.”

To the same effect many other cases might be cited.

It is also claimed that this law conflicts with Sect. 6, Art. VIII of the constitution, which provides “The General Assembly shall never authorize any county, city,town or township, by vote of citizens or otherwise, to become a stockholder in any joint stock company, corporation or association whatever, or to raise money for or loan its credit to or in aid of any such company, corporation or association.” This claim is based upon the provisions of Sec. 8 of the act. In brief, it might be said that the previous sections provide for the construction or enlargement of water-worksby five commissioners, to be appointed by the Governor of the state, while Sec. 8 provides, in brief, that if the commissioners should deem it inexpedient or “inadvisable” to proceed to construct the works themselves, it authorizes them to contract for the construction of said works as an entirety with any person or company, and to lease the same from said constructing party upon such terms as may be agreed upon on the completion of the same, such lease not to be for a longer period than forty years with privilege of a renewal, with the privilege on behalf of the city to purchase said works at the end of each period of ten years. It provides that if this action is taken, said commissioners may convey to said constructing party,any property of the city which may be necessary for the construction of said works. We are unable to see how, if the commissioners should conclude to have the works constructed in accordance with this provision, it would be in violation of this section of the constitution. The part of the section which is claimed to apply is this: “Or loan its credit to or in aid. of any such company, corporation, or association. ”

The evil that this section of the constitution was intended to prevent was of great magnitude, and was well understood by the framers of the constitution. If it were not for this provision, every municipality in the state would be in danger of financial ruin. The usual form assumed by this evil, is for municipalities, in order to increase their population, to give donations to manufacturing plants and railroads, to induce them to come to their places. It is hard for the citizen who has the good of his municipality at heart to resist the temptation which, in almost every instance, such schemes hold out for the benefit of his town or city. But if this were permitted, there would be no end to it, and the result would be that the taxpayers would be building all the factories and railroads, and yet not running the plants, but getting only such benefit as an increased population would bring them.

But it seems to us that this element is wholly lacking in this law. If the commissioners should deem it inexpedient to build the works themselves, it would not be for the purpose of benefiting or aiding a constructing party, but for the benefit of the city. As far as it applies to Cincinnati, we can very easily see why the commissioners might deem it to the advantage of the city to adopt this course. If the commissioners should build the works, it would add $6,500,000, to the debt the city; and to that extent the credit of the city would be impaired. While, if a constructing party would build the works, it would have to furnish the money until such favorable time as the city might find in which to buy the plant. Whatever aid the constructing party would derive from this arrangement, would only be such as it might derive from its profits, if any, from the building and leasing of the works. 'There could be no more aid in this than is given to every party who constructs a street or any other improvement for the city.

But even if this section of the act is unconsitutional, we do not think it would invalidate the whole act; for it is a section separate and apart from the other sections, and they would stand unaffected by it.

It is further claimed that this law is administrative, and,. therefore, the Legislature exceeded its power in passing it, and that it comes within the recent decisions of the Supreme Court in the Paddack road case and others. We see no objection to the act on that ground. It is not administrative as to the manner of building the works. That is left to the commissioners. It is very exact and particular as to the making of the contracts, but that was clearly only intended as a protection to the people and a safeguard to the proper expenditure of the money. We regard this as entirely proper.

It is further claimed that this act must be construed together with an act passed April 24, 1896, 93 O. L. 605; that the two must stand or fall together, and that, taken together, the law is invalid for several reasons. One, that it is class legislation; another, that it is void because of inequality, and another, that it is the raising of a general revenue in an improper manner. These acts provide, by means of a sinking fund, for the ultimate paymentof the cost of the works from water rents, whereas, it is claimed, it should be borne by the taxpayer. We passed on this question in the case of City ex rel. vs. The City, 11 C. C., p. 309, holding the acts of the Board of Administration lawful. We see no reason to change our opinion now. It seems to us more of a theory than a reality, that the consumers bear all the burden. Doubtless the most of the consumers are the owners of their property; and when, as it is here at present, landlords are seeking tenants, the water rent really comes out of the property-holders; for the water rent is always taken into consideration by the renter. But we see no reason why the water consumers, who get the benefit of the water-works, should not bear the burden.

Wm. M. Ampt, for plaintiff.

Fred. Hertenstein, City Solicitor and Paxton, Warrington, Boutet for the city.

In the case of Ampt vs. The City, supra, it was shown that under the present management of the water-works, the costs to consumers had been reduced at an average of over 12-| per cent., and that the rents were low and not oppressive. If this were to continue, there could be no just cause for complaint. If, however, the rents, in the future, were to become oppressive and exorbitant, the Courts doubtless then could afford relief.

Other objections were raised to the act, involving its constitutionality, which we have considered, but which we do not deem necessary to refer to in this opinion.

Upon the whole, we think the act valid. We have gone over the matter fully, and given it such careful consideration as we could, recognizing that it is a matter of very great public importance.

As a result of our conclusions, the several petitions will be dismissed.