author: SwiNG, J.

text:
    (First Circuit — Hamilton Co, O., Circuit Court
    January Term, 1898.)
    Before Cox, Smith and Swing, JJ.
    PARKS v. THE ENQUIRER COMPANY.

      Libel — Malice—
    Ihe plaintiff is bound to show that the publication was false and malicious, as charged in his petition, and the burden is not cast on the defendant to prove that the publication was honest, fair and impartial, as alleged in the answer.

      Same — Report of court proceedings• in newspapers—
    Al! trials in our courts, except when in certain cases it would be against the public morals, are open to the public, and the proceedings had on these trials newspapers are privileged to publish. .The only limitation placed upon them is that what they publish must be a fair, impartial and honest report. If fair and impartial, there is no libel, and therefore no liability; if false and malicious, liability arises.
    Error to the Court of Common Pleas of Hamilton coun- %-
   SwiNG, J.

This case is in this court on error to the judgment of the court of common pleas. Parks brought suit in that court against the Enquirer Company for an alleged libel.

The petition contained the averments that one Mary Olay obtained a judgment against plaintiff under the name of L, F. Parks for the sum of $20.50 in a suit for wages due her, tried before Philip Winkler, Esq., justice of the peace in the city of Cincinnati, on March 10, 1894.

That the defendant on March 11, 1894, at Cincinnati, Ohio,published in the “Cincinnati Enquirer”,a daily newspaper of general circulation, concerning said trial the following article, to-wit: Mrs. Mary Clay, a woman 70 years of age, sued L. F. Parks, a Colerain avenue machinist, for $20.50, alleged to be for services as housekeeper. Parks put in a counterclaim for presents to Mrs. Clay’s granddaughter, but Squire Winkler refused to consider the claim and gave the judgment for Mrs. Clsy. The aged plaintiff stated in her testimony that Parks discharged her because she did not make corn cakes to his liking. She also said that Parks tried to abduct her granddaughter, a girl of 14 years, and that he wrote the latter sentimental letters asking her to visit his Kentucky home.”

The defendant meant by said article aforesaid that at the said trial of Clay v, Parks it appeared in evidence that plain, tiff therein, Louis F, Parks, had tried to abduct the fourteen year old granddaughter of Mary Clay, and had written sentimental letters to said granddaughter asking her to visit Louis F. Parks, plaintiff herein; had also tried to off-set against Mary Olay’s claim for services the value of gifts which Parks had given to said granddaughter.

That no such evidence was adduced at said trial, “and that said publications are in these particulars false, malic, ious and libelous.”

Then follow certain allegations as to damage, and sa prayer for judgment.

The Enquirer Company filed an answer, in which it admitted the publication complained of, and for its defense said that it prints and circulates a daily newspaper known as “The Enquirer;” “that on or about March 10, 1894, there was a certain cause entitled Mary Olay v. L. E. Parks, duly and regularly tried before Philip Winkler, a justice of the peace duly and regularly elected and qualified as such in and for the township of Cincinnati, Hamilton county, Ohio, in which trial Mary Olay recovered a judgment against the plaintiff in this action, L. F. Parks, in the sum of twenty dollars and fifty cents, with attorney’s fees. Defendant says that said article complained of was printed by defendant bona fide and without malice for the public benefit and in the usual course of defendant’s business and duty as a' public journalist, and is a correct, fair, impartial and honest report of the proceedings had in and at such trial.” Then followed a general denial of the averments of the petition.

Plaintiff filed a reply saying that he “denies that the article complained of is a correct, fair, impartial and honest report of the proceedings had in and at said trial of Mary Clay v. L. F. Parks, but on the contrary alleges that said article is false, malicious and defamatory, as pleaded in plaintiff’s amended petition.”

On the trial of the case the plaintiff offered evidence tending to prove the circulation of the paper among his acquaintances; that it had given him great mental suffering; that he had quit going to church, and that by reason of the publication his arrangement for boarding with a family at Bond Hill had been broken off, and other evidence tending to show damage to him; but no evidence of any kind was-introduced which tended to show that the publication ■ was false or malicious, or that it was not a fair and impartial account of the evidence at the trial. At the conclusion of the plaintiff’s evidence the court, on the motion of the defendant, directed the jury to return a verdict for the defendant. The single question here is, was this error.

Is the plaintiff bound to show that the publication was false and malicious, as he charged in his petition, or is the burden cast on the defendant to prove that the publication was honest, fair and impartial, as it alleged in its answer?

It is not my purpose to cite or review authorities at length bearing upon this question, and I will content myself by stating dogmatically what I understand the law to be.

In the first place, all trials in our courts, except when in ■certain cases it would be against the public morals, are open to the public, and the proceedings had on these trials newspapers are privileged to publish, The only limitation placed upon them is that what they publish must be a fair, impartial and honest report. The publication of the proceedings of a public trial must therefore be in the nature of a privilege, subject to the limitation that it be fair and impartial. If fair and impartial, there is no libel, and therefore no liability; if false and malicious, liability arises. If liability for damages only arises from a false and malicious publication, it would seem reasonable and logical that the person seeking to recover damages for such a publication should allege that the article was false and malicious, and it would follow that if necessary to be alleged it would be necessary fo be proved. The pleader in this action must have taken this view of the law, for he averred in his petition that the publication was false and malicious; but upon the trial he contended that it was not necessary for him to prove these averments.

In the case of Nolan v. Kane, 13 C. C. Rep., 485, this court said in regard to a communication which was held to be in its nature a privileged one:

“This communication was in its nature a privileged one. The citizen,if he acts in good faith and in a reasonable way, is protected; as a citizen,he is interested in the public welfare. He not only has the right,but it is his duty as a citizen to communicate to the appointing power whatever he knows for good or ill concerning one who is an applicant for the position as teacher, and when such communications are made in good faith,the citizen is protected even though the statements contained in the communication be not true. No authorities need be cited to sustain this well settled principle of law. In order to create a liability of the citizen for the making of a communication under such circumstances,it is not only necessary to show the falsity of such utterances, but that it was done from malice. If either of these elements is lacking, there can be no recovery.”

Cox and Smith, JJ., concur,

D.P. Wayne, and Wright & Wright,for the Plaintiff in Error.

Alex. Murry, Jr., for the Defendant in Error.

The cases are alike in this, that the communications are in their nature privileged. That is,not absolutely privileged, but only when honestly and fairly made. In this case the publication was concerning what occurred at a trial in court It was alleged to be false and malicious. If not false and malicious, the plaintiff could not recover. He offered no proof to show its falsity or maliciousness; therefore there could be no recovery, and the court did right in directing a verdict for the defendant.

Judgment affirmed,


source: Caselaw Access Project

author: Smyser, J.

license: Public Domain

text:
    (Fifth Circuit — Licidng Co., O., Circuit Court.
    March Term, 1898.)
    Before Adams, Douglass and Smyser, JJ.
    SAMANTHA WALRATH v. ROYAL INSURANCE CO.

      Fire Insurance — Reformation of policy — Oral evidence to show the understanding of parties—
    (1.) Policy of insurance — Not always necessary to reform policy in equity before an action at law may be maintained.
    (2.) Parol evidence can not change the language of a policy; but parol testimony may aid the court or jury in ascertaining the sense in which the words were used.

      (3.) Action on a policy of insurance an exception to general rule that parol evidence may not contradict the written instrument. Parol evidence admissible where it makes plain the real contract of the parties, while a literal construction would defeat the real intention of the parties.
    Error to the Court of Common Pleas of Licking county.
   Smyser, J.

The case of Samantha Walrath v. The Royal Insurance Company is here on error, and but a single question is presented to this court.

The plaintiff in error commenced an action before a justice of the peace for the recovery of fifty dollars for loss by fire claimed to have been covered by a policy of insurance issued by the defendant to her. The case went on appeal to the court of common pleas. A petition was filed there, and’the policy attached to the petition. The petition is in the ordinary form,/and asks a judgment for fifty dollars. The cause was tried; once before this court, and reversed. A second amended petition was filed in the court below. To this second amended petition a general demurrer was interposed and sustained by the court, The plaintiff not desiring to plead further, brings the action of the court in sustaining that demurrer here for review. The question is whether this amended petition constitutes a cause of action.

I will read the petition, omitting the formal parts:

“Plaintiff says that prior and up to the 21st day of July, 1890, she held a policy of fire insurance from said defendant on her dwelling-house and certain personal property, located in Hanover township, being in range 10, section 2, in Licking county, Ohio, and which policy was deposited by said defendant with the Homestead Building Association, of Newark, Ohio, for the reason that said association had an interest in said real estate by mortgage.
“That prior to the expiration of said old policy, the said defendant by its agent, J. P. Murphy, while standing in the road in said village, township, section and range, and in full view of said real estate aforesaid, solicited said plaintiff to take out additional insurance on said property, as she had made some improvements thereon. That said agent was then and there, as well as said defendant, well acquainted with said property, its location and kind, so insured in said old p olicy.
“That at and prior to said 21st day of July, 1890, the said plaintiff was the owner of ten ton of hay, which was then stored in the barn of one Dr. Bukey,in said township, section, and range, and of which barn she was then and there the owner of a lease for years. That on said day, while so standing on the road in said township, section and range, in addition to soliciting her to take out such additional assurance on the property mentioned in the old policy, as aforesaid, he solicited her to take out some insurance upon said ten ton of hay, in said barn, which was located as aforesaid, said barn being then and there close by and in full view of said agent; and promising that the old policy should be canceled, a new policy issued, covering said additional insurance, and covering said hay, and that the unearned portion of the premium on the old policy be applied upon the premium on said new policy, and that she should have until September 15, 1890, to pay the balance of said premium. That then and there the said plaintiff notified said company through said agent, that she did own the said ten ton of hay which was then and there stored and located in said barn of Bukey, and that she had the said barn leased, and that she neither owned nor possessed any other hay whatever. That said barn was then and there pointed out to the said agent, and said agent invited to go to said barn and see said hay, and which was but two or three hundred feet distant; but said agent refused to do so, saying that it was unnecessary.
“That said defendant through said agent, was then and there informed that the said barn was owned by said Bukey, and that said plaintiff had simply a lease of the same. That said agent thereupon informed and notified her that he would put the said hay in said new policy, insuring it for the sum of fifty dollars, and he then and there agreed with her that he would at once make out the policy so that the said hay would be insured, and issue the same as soon as he got back to his office at Newark, Ohio, and deposit it with the said Building Association under the same arrangement as existed with the old policy as aforesaid, on account of the mortgage which the association held on said real estate, and s»id plaintiff never saw said policy until after said hay was destroyed by fire. That said Bukey barn wa& situated more than 500 feet from the real estate of said plaintiff sd as aforesaid mentioned as being insured in the-old policy, and said defendant was well aquainted with the said difference in said locations.
“That the said defendant well knew at the time it solicited said plaintiff to insure said hay, and at the time it issued its said policy of insurance, that the said plaintiff did ow® said ten ton of hay, and owned no other hay whatever,nor was in the possession of any other hay; that the said hay was so stored in the barn of said Bukey, who was the owner, and that she was in the possession of said barn under a lease from said Bukey. That said defendant well knew at said times exactly where said barn and hay were located.
“That the said agent then went back to his office in Newark, Ohio, and issued the policy, a copy of which,marked “A”, is attached to the original petition, bearing date July 21st, 1890, in consideration of the premium paid by the plaintiff of $18.50; taking up the old policy, and apply ing the unearned premium thereon, to the payment of the premium on said new policy, and deposited it with the Building Association, aforesaid. And plaintiff says that she has duly kept, observed and performed all the requirements and conditions contained in said policy, by her to be kept and performed,
“That on the 11th day of September, 1890, said hay was totally destroyed by fire, of all which the said defendant had due and proper notice.
“Plaintiff further says that by said policy of insurance the said defendant did then and there insure the said plaintff, among other things, against loss or damage by fire, to the amount of $50, on said hay. That she was the owner of said hay, and continued to be the owner of the same up to the time the said hay was so destroyed by fire.”.

The petition then goes on to set out the real value of the hay destroyed at $70.

The policy is as follows:

“In consideration of the representations, conditions and warranties herein-after mentioned or referred to, and the receipt of thirteen and 50 — 100 dollars, do agree to indemnify Samantha Walrath (hereinafter called the assured) against all such immediate loss or damage as shall happen by fire to the following specified property.
“On the following described property, situated on No. sec. No. — , township 2, No, range 10, county of Licking and state of Ohio, on side of - — Road.”

Then follows: “On slate roof, frame dwelling house No. 1.”

The next provision is: “On household furniture while contained in dwelling No. 1.” “House No. 2, including foundation and cellar walls”; left blank. “On shingle roof frame barn No, ”. “On horses and mules, not exceeding $100, on any one heada, against loss by fire or lightning, while in barns or on farm of assured, and against lightning while at large or in use. On live stock while in barns or on farm of assured.” “On grain,in stacks, granary, barns and cribs, on farm, not exceeding $25 on any one stack.”
“On hay in barns or stacks, on cultivated ground only, on farm, not exceeding $25, on any one stack, $50.”

As I said, there is a general demurrer interposed to this petition, on the ground that it dose not state facts sufficient. A majority of the court have reached a conclusion that is satisfactory to the majority. Judge Adams, however, dissents. Speaking for myself, I think this original petition was^good; but that is not the question. That is not before us.

■What is recited in that petition? That this company agreed to insure, and did insure, among other things, ten ton of hay belonging to .Mrs. Walrath, in the township of Hanover, in the county. That that amount of hay was insured by this policy, That it was lost by fire, and that she performed all the conditions of her required. It has been urged here that a fair construction of*the provision which I have read from the policy means that the hay must be on her farm. The language of the policy does not say “on her farm”. There is a difference in the use of language from the preceding insurance on stock, There the words are used: “On the farm of assured.” But, in this case the words “of assured” are omitted.

It is urged in support of this demurrer, that if this policy does not express what was actually intended by the parties, before the plaintiff can have relief in an action at law, she must go into a court of equity and reform the policy so as to express the contract between the parties, and then resort to law for redress for this loss. And it is said that the matter contained and recited in this second and amended petition is evidence, and that, being evidence, it would not be proper to offer it upon the trial, because it would tend to contradict the written instrument, or vary it by parol.

It may possibly be evidence, but it may be of that character of evidence that is sometimes plead to constitute a cause of action. We suspect that the way this happened to arise was because when pay was demanded for this loss, this insurance company said: w,e didn’t insure any hay for you any other place than on your farm and this hay being admittedly not on her farm, in the sense that she owned it, she could not recover; and that it was not included in this policy. It is anticapating and meeting that very defense that this second amended petition is drawn.

We think there is a case in Ohio that is fairly decisive of this question in 1 C. S. C. R. 361, decision by Judge Taft. That case was contested by eminent counsel. For the plaintiff were Oox, Burnett & Follett and Geo. E. Pugh. For the defendant Insurance Company, Hoadly & Johnson. “The suit was for a loss, under a policy of insurance, upon certain merchandise , machinery, tools, and fixtures. There is no dispute about the loss or the amount of the loss; but the question is, wfiether the policy included the property lost. It consisted of tobacco situated in the fifth story of a building on Main street, which was used by the plaintiff in connection with a five-story brick building fronting on Hammond street,the connection being by wooden bridges across an area.

“The policy insured C.W.Roback against loss or damage by fire, to the amount of $5,000, for the term of one year, on his merchandise, hazardous or not hazardous, and his machinery, tools, and fixtures, contained in the five-story brick building occupied by him as a tobacco factory and ware-house, Nos. 19 and 21, situated on the west side of Hammond street, between Third and Fourth streets, in Cincinnati, Ohio. The above premises heated by a furnace in the cellar and connected with the building by wooden bridges from the upper story.
“The above premises are occupied as a tobacco factoy.
“The anwser denies that the defendantinsured any property of the plaintiff at any other place than at Nos. 19 and 21, on the west side of Hammond street, and denies any loss of property insured by the defendant.
“The plaintiff proposes to'prove,and it was admitted that it could be proved, that when the policy of insuracne was obtained, the tobacco in the fifth story of the Main street building was shown to the agent of the defendant as part of the subject of insurance, and that a surveyor on behalf of the defendant examined it all, including that in the fifth story of the building on Main street, which was occupied as part of the factory and ware-house by the insured, and that the said fifth story was used entirely and exclusively in connection with the said five-story building as a part of said factory and ware-house,
“The judge, at special term,ruled out the evidence as inconsistent with the written description in the policy, and instructed the jury that the plaintiff was not entitled to recover for the loss; to which the plaintiff excepted.
“The question is whether the merchandise in the fifth-story of the Main street building was covered by the policy under the circumstances, and whether this evidence was competent.
“The language cannot be changed by parol evidence; but, by parol or verbal testimony the jury or the court may be aided in ascertaining in what sense the words were actually used.
“It is obvious that this property, in the fifth-story of the Main street building, would not be held to be necessarily included in the description as part of the merchanidse, machinery, and tools in the five-story building without the aid of parol proof to explain its connection with it. Nor do we #hink that the language of the description necessarily excludes property in a room opening into or connected with the five-story brick building, as this is shown to have been. The consequence is that we think that the evidence was competent. This is one of the cases in which a written contract, which is to be construed in the light of the circumstances appearing in evidence, may be construed even by the jury, under the direction of the court.
“Upon the whole, we think that a man knowing the facts as they' existed at the time to which we have referred, and reading the policy in the light of them, would naturally include the tobacco in the fifth-story of the Main street building as part of the insured premises. If such would be the case, we do not think it necessary that the plaintiff should be put to the risk of losing his insurance by failing to show a mutual mistake in a suit for a reformation of the contract. If it may be made so as to include the tobacco as it stands, and if the circumstances under which the contract was made require us so to read it, we think they may be shown by parol evidence.”

There is a case in 13 Wallace, 617, The Union Mutual Life Insurance Co, of Maine v. Wilkinson. To show just what the exact question was, I call attention to the brief of counsel:

“The question to be discussed is: Had the court and jury, under any pretense whatever, any right to take into evidence the parol statements made by the applicant or others, which were contemporaneous with the singing of the application?”

Let it be observed that by the terms of both instruments, the application was a part of the policy.

Both instruments, taken together, constituted one contract.

The plaintiff sues on that contract as it stands.

It had not been reformed in equity,but stood, on the day of trial, just as the respective parties had signed it.

We have then,this anomalous position in a court of law: The plaintiff sues on a written contract, signed by himself, as one of the parties; he asks a recovery according to the terms of that contract; and yet, in the same breath, is permitted by the court to contradict and vary the terms of this written contract, by proving what was stated by himself and others, at and before the signing of the same.

One of the questions was that she had answered that shó had never suffered any material injury, and Justice Miller disposed of that question first; but in the disposition of it on page 622, it appears that the beneficiary was young and did not make that answer. Just as in the case at bar, —< Mrs. Walrath had no more to do with the language in which she expected to have her hay insured than any member of this court. That she left it entirely to the company.

“But that there was. present,at the time the agent was taking the application, an old woman who said she had knowledge on that subject, and that the agant questioned her for himself, and from what she told him he filled in the answer which is now alleged to be untrue, without its truth being affirmed or assented to by plaintiff or the wife.
“The jury found specially.
“And on this subject the court instructed the jury,that if the applicant did not know at what age her mother died, and did not state it, and declined to state it, and that her age was inserted by the agent upon statement made to him by others, in answer to inquiries he made of them, and upon the strength of his own judgment based upon data thus obtained, it was no defense to the action to show that the agent was mistaken, and that the mother died at the age of twenty-three years.
“To the introduction of the oral testimony regarding the action of the agent, and to the instructions of the court upon that subject, the defendant excepted and assigns the rul.ing of the court as error on the ground that it permitted the written contract to be contradicted and varied by parol testimony.
“The great value of the rule of evidence here invoKed can not be easily overestimated. As a means of protecting those who are honest, accurate and prudent in making their contracts, against fraud and false swearing, against carelessness and inaccuracy, by furnishing evidence of what was intended by parties, which can always be produced without fear of change or liability of misconstruction, the rule merits the eulogies it has received. But experience has shown that in reference to these very matters the rule is not perfect. . The written instrument does not always represenst the intention of both parties. ’’

And yet that is hardly the case in the case at bar. This demurrer concedes the truth of the facts plead here. There is no contention but what this woman was to have insured ten ton of hay, and as she says she had but ten ton in Hanover Township, and that that was in the barn of Dr1 Bukey.

The written instrument does not always represent the intention of both parties, and sometimes it fails to do so as to either, and where this has been the result of accident or mistake or fraud, the principle has been long recognized that under proper circumstances, and in an appropriate proceeding, the instrument may be set aside or reformed, as best suits the purposes of justice.

In the case before us, a paper is offered in evidence against the plaintiff containing a representation concerning a matter material to the contract on which the suit is brought, and it is not denied that he signed the instrument, and that the representation is untrue. But the parol testimony makes it clear beyond a question, that this party did not intend to make that representation when he signed the paper, and did not know he was doing so, and, in fact, bad refused to make any statement on that subject. If the writing containing this representation had been prepared and signed by the plaintiff in his application for a policy of insurance on the life of his wife, and if the representation complained of had been inserted by himself, or by some one who was his agent alone in the matter, and forwarded to the principal office of the defendant corporation, and acted upon as true, by the officers of the company, a different question would arise.

If, however, we suppose the party making the insurance to have been an individual, and to have been present when the application was signed, and soliciting the assured to make the contract of insurance, and that the insurer himself wrote out all these representations, and was told by the plaintiff and his wife that they knew nothing at all of this particular subject of inquiry, and that they refused to make any statement about it, and yet knowing all this, wrote the representation to suit himself, it is equally clear that for the insurer to insist that the policy is void because it contains this statement, would be an act of bad faith and of the grossest injustice and dishonesty.

“It is precisely for such cases as this that courts of law in modern times have introduced the doctrine of equitable estoppels, or as it is sometimes called, estoppels in pais. The principle is, that where one party has by his representations or his conduct induced the other party to a transaction to give him an advantage which it would be against equity and good conscience for him to assert, he would not in a court of justice be permitted to avail himself of that advantage.’’

Then the court discusses how insurance is obtained. That the time has gone by when people seek out the insurance companies for their insurance, but the insurance companies seek out the people.

The court concludes:

“The modern decisions fully sustain this proposition, and they seem to us founded in reason and justice,and meet our entire approval. This principle does not admit oral testimony to vary or contradict that which is in writing,but it goes upon the idea that the writing offered in evidence was not the instrument of the party whose name is signed to it; that it was procured under such circumstances by the other side as estops that side, from using it or relying on its contents; not that it may be contradicted by oral testimony, but that it may be shown by such testimony that it cannot be lawfully used against the party whose name is signed to it. ”

In the case at bar, the petition recites what the contract was. She was to have insurance on ten ton of hay. She pointed it out. And, anticipating a defense that might be made that, under the provision in the policy, this hay was not included in its terms, the pleader has seen fit to set out what would estop this company from making tüe defense that this hay was not included within the terms of this policy. The authorities are numerous that where there is mere misdescription or anything like that, it does not avail. There is a case in 49 Northwestern Rep. 333, where a party was sued on a promissory note, and there was a misdescription He came in and said, by way of defense, that the policy was void for the reason that there was a misdescription, and that therefore he ought not to pay the note. The court said that is no defense, — the mere fact that there is a misdescription — you understand what property was to be insured. This insurance company understands what property was insured,' and merely because there happens to be a misdescription, does not invalidate the policy, and does not relieve you from your obligation to pay the premium; nor, in case of loss, would it relieve the insurance company from paying whatever the loss might be.

There are some Ohio authorities. A case in 31 Ohio State 488, The Ohio Farmers’ Insurance Co. v Britton, Guardian, et al. Britton died, leaving ten children, some of them of age; some minors, and a widow. The widow’s dower had never been assigned. She and some of the elder children put up a new house on the premises, and she took out some insurance, $1600, on the dwelling and $600, on the contents, the policy being issued to “N. B. Britton’s heirs”. A loss occurred, and the company answered, as their chief defense-: 'That the dower interest of Mrs. Brit-tori in the premises constituted an incumbrance upon the property insured, and, therefore, that policy was void. ” Ip deciding this casé, Judge Boynton says:

“Let it be referred to either, and the representation that the property was not incumbered was strictly true, and being true, its effect is not to be destroyed or varied by the circumstance that the policy was issued to the heirs alone. The issuing of the policy to the heirs instead of the widow and heirs was the act of the company. It nowhere appears to have been done in pursuance of any direction given to the company by one interested in the property, nor upon any stateinent, oral or written, that Mrs. Britton was acting exclusively for them.”

So, in this case, it was not the act of this woman. It was the-act of the company. ■

In-the 27 Ohio St., 1, is a case where a policy had been issued to West & Oo., a partnership. West sells out; a loss occurs, and suit is brought by the remaining partners, and .it was contended in that case that there could be no recovery. I read, on page 7, from the decision by Justice Johnson:

“It will be observed that this policy (which is part of the record) is a contract with a partnership, and not with the individuals composing it; that, as such partners, they own, ed the stock of goods, and were doing business there within the. usual way. ”

I desire to call attention to the construction that this insurance policy should receive:

“The policy should receive a reasonable interpretation.. Its-iritent and substance should be ascertained from the language employed. Its stipulations should have full legal effect, to guard the insurer against fraud and imposture. As it is a contract of idemnity to the insured, it should be liberally construed in his favor, not only because this mode of construction is most conductive to trade and business, but' because it is probably most consonant with the intentions bf the parties. There is no more reason for a strict compliance with its terms than ordinary contracts. There is toothing in such a contract intrinsically more sacred or inviolable than a contract about any other subject. 25 Wend. Ü74. Exceptions in a policy should be strictly construed, tad when there are two interpretations equally fair, that Which gives the greater indemnity should prevail.”

None of these rules is more fully established or more impóíative and controlling than that which declares that it must be liberally construed in favor of the insured, so as not to defeat, without a plain necessity, his claim to indemnity, which, in making his insurance, it was his object to secure.

The court reaches the conclusion that although there had been a change in this partnership, that one partner had sold out and the contract of insurance was with the partnership, that it was not such an alienation of the property as would defeat a recovery in the case of loss. The court says:

‘‘We are aware that the conclusions we have reached are at variance with the greater number of reported cases, but we believe these conclusions rest on the firmer and more satisfactory ground of sound principéis, and that they are more conducive to substantial justice, — 'the aim and end of all law.”

So there is a gradual breaking away from the old doctrine that, with an insurance company, you must stand upon the strict letter of the contract, and if perchance, there may be ■some doubt or ambiguity in its construction, a recovery can be defeated until a party goes into a court of equity and asks for a reformation of the contract, to express the contract as it was intended by the parties. Wherever it appears that that might be done, might be used to defeat a recovery by the company, the plaintiff may anticipate, and may plead by way of estoppel.

We have a case in our court in our county, where the question arose upon a limitation clause providing that an action was not to be maintained nnless suit was brought within one year after the loss. Suit was not brought until fifteen months after the loss; but in stating the cause of action, to avoid being driven out of court on demurrer, the plaintiff alleged that that provision in the policy was waived. This company issuing this policy, and this woman having nothing to do with it, we think the company ought to be bound; and we think it is only fair to anticipate what is alleged here. This language in the policy is not her own. She did not put it here. She did not see it. It was part of the arrangement that she was not to see it. It was to be delivered directly to this Building and Loan Association.

S. M. Hunter, on behalf of Plaintiff.

Follett & Follett, on behalf of Defendant.

We think this demurrer was ! improperly overruled, and for that reason this judgment is reversed and cause remanded.

Judge Adams dissents.


author: Smith, J.

text:
    (First Circuit — Hamilton Co. O., Circuit Court
    January Term, 1898.)
    Before Cox, Smith and Swing, JJ.
    C. F. STAMBACH v. EDITH K. FOX.

      Mortgage to administrator, “successors and assigns,” omitting “heirs" — When will pass fee simple estate—
    A mortgage made to an administrator and to “his successors and assigns forever,” the word “heir” being omitted, will pass a fee simple title, and not a life estate only, where the language employed in, and the recitals and conditions of the mortgage plainly evidence an intention to pass the entire estate Of the' mortgagor as security for the mortgage debt,and the express provisions of the instrument cannot be otherwise carried into effect.
    Appeal from the Court of Common Pleas of Hamilton county.
   Smith, J.

Qn the evidence submitted in this case we think the plaintiff is entitled to the relief sought.1 ' We have no ’doubt' " but that the original mortgage, executed -by George : Fox') and Eliza J. Fox, then "his -wife, on May 81, 1881, to:i Joseph D. Taylor, to secure three notes' of that date — on© for $.2,000, and the other two for $10,000 each — all payable'to said Taylor, was founded on a good and valuable con-' sideration, viz.that the separate property of the wife was "' to 'be used in paying the debts of the Starch® Company for | which the husband was liable, and that a very large amount, of her property was in fact used for that purpose at the instance and request of her husband. The mortgage and notes so made to Taylor were in effect to him as trustee for his wife. The $2,000 noté was turned over to his (Fox’s) attorneys for services, and the two notes for $10,000 each were intended to secure Mrs. Fox for the advances subse- : quently made from her estate and property for the purpose aforesaid. During her life these two notes were turned over and assigned by Taylortó Mrs. Fox, and some part of the mortgaged property having been sold, various payments, out of the purchase money received were made to her.

On the death of Mrs. Fox, the two notes were, with the knowledge and consent of George Fox, treated as th© property of her estate, and were inventoried as such by Mr. Taylor, who.had been appointed administrator of her estate. After this, on February 18, 1887, in view of the-fact'that payments had been made to Mrs. Fox on these notes, and it appearing to be conceded by all parties in interest that one of the notes for $10,000 was still unpaid,. Geo. Fox executed a new mortgage (the one sued on in this case) to Mr. Taylor, as the administrator of the estate of his deceased wife, to secure the payment of one of the $10,000 notes; and the old ihortgage was released and canceled, the|Tmortgagor thus again acknowledging the justice- and validity of so much of the original claim, and that it was due and unpaid. After this Taylor indorsed the note- and the last mortgage to the three children of Mrs. Fox, of whom the plaintiff was one, and the other two afterwards transferred their interests therein to the plaintiff who ndw owns the whole thereof.

After the death of Mrs. Eliza J. Fox, and after these transactions, viz,, on March 14, 1895, George Fox, who had married the defendant Edith K. Fox,executed to her a deed for the property covered by this last mortgage and for other real estate described in the said deed. It was an ordinary deed in fee simple, with covenant's of general warranty, except that immediately following the covenants is •this statement:

“Lots 555 and 556 of Van .Horn’s subdivision of William Baker’s estate-.are subjeit to a mortgage recorded in Mortgage Book 612, page- 135, to Thos. J. Emery and John J. Emery, and said lots 16, 17, 18, 22 and the south thirteen feet off of lot 21 are subject to a mortgage made by said George Fox to Joseph D. Taylor, administrator of Eliza J. Fox, deceased, recorded in Mortgage 600^-525, page 259, which .mortgage has been ’ assigned by said Joseph D. Taylor, administrator, to Annie Fox Taylor, C, F. Stambach and Edna B. Fox, and such grantor expressly agrees to pay off and remove all of said encumbrances from all of said real estate.’’

It is the claim of the plaintiff that this statement and recital in the deed under which Mrs. Edith K. Fox holds her title to the property mortgaged to Taylor, administrator, by George Fox, estops her from denying the validity of the mortgage sued on, as it is an express recognition of the validity thereof, and that, claiming under thefcleed which contains this recognition of the mortgage, she took her title subject thereto, and cannot now legally] claim ]*that thóre was no consideration therefor, or that the] mortgage is in any way defective.

With the view we have taken of this case, we think, it is not necessary, that we.should express an opinion as to this. We have found that there was a good, sufficient and valuable consideration for both of the mortgages given to Taylor by Mt. Fox, and we are further of the opinion that the mortgage given to Taylor, as administrator, being the one sued on in this case, is not to be held as simply a mortgage to Taylor for his lifetime, or that of a successor in the trust, but that it operated as a conveyance by way of mortgage of the whole title of Fox to the land mortgaged.

The facts as to this mortgage are these: The first one was to Taylor, his heirs and assigns forever, and was clearly a mortgage of the whole estate. The second (the one sued on) granted, bargained, sold and conveyed the premises “to the said Joseph D. Taylor,administrator as aforesaid,his successors and assigns forever.: ’ It had previously described him as “administrator of the estate of Eliza J. Fox, deceased,” and it conveyed all the estate, title and interest of the said George Fox, either in law or in equity of, in and to the said premises; together with all the privileges and appurtenances to the same belonging, and all the rents, issues and profits thereof; to have and to hold the same to the only proper use of the said administrator, his successors and assigns forever.” Then follow the covenants of seizin and general warranty (except a mortgage to H. W. Taylor), made with said Joseph D. Taylor, administrator as áforesaid, his successors and assigns;” and after this the defeasance clause in the ordinary form.

It will be noticed that in all of these clauses of conveyance or warranty the word “‘heirs” is not used in connection with the grantee or mortgagee. The grant is to him as ■administrator, and to “his successors and assigns forever.” ■And for this reason it is claimed by the counsel for the defendant, Mrs. Fox, that a fee simple title was not mortgaged.

In view of the holdings of the supreme court of this stafe in the cases of Brown v. Bank, 44 Ohio St., 269, and Bank v. Johnson, 47 Ohio St., 306, we are of the opinion that this claim is not well founded. In the first of the two cases cited, the court hold:

“1. By a well established general rule the use of the word ‘heirs,’ or other appropriate words of perpetuity,in a mortgage or other deed of conveyance of lands, is essential to pass a fee simple estate; but this is notan inflexible rule, admitting of no exception or qualification.
“2. Where the language employed in, and the recitals and considerations of a mortgage plainly evidence an intention to pass the entire estate of the mortgagor as security for the mortgage debt, and the express provisions of the instrument cannot bo otherwise carried into effect, it will be construed to pass such estate although the word ‘heirs’, or other formal word of perpetuity, is not employed.”

In the case at bar we think this intention to pass the entire estate of the mortgagor as security for the mortgage debt appears as clearly as it did in the Brown case, and that the express provisions of the instrument cannot otherwise be carried into effect, unless this intention is carried out, and therefore it must be held to have conveyed all of the estate of the mortgagor.

In Bank v. Johnson, supra, where an action was brought to foreclose a mortgage given to a partnership under its firm name, ‘‘The New Vienna Bank,” and where the conveyance was ‘‘to the said New Vienna Bank, its successors and assigns forever,” without other words of limitation, it was held that:

‘‘A mortgage upon real estate made by a partnership in its firm name to secure an indebtedness to it, duly executed and recorded as required by statute, constitutes a valid lien upon the property in favor of the firm, as a security for the indebtedness to it.”

. It is true that the court in this case did not allude to the question whether the mortgage deed conveyed the whole interest of the mortgagee therein for the security of the debt. It rather appears .as if it, was taken for granted that it did, as if is stated that such a mortgage constitutes a Valid lien on the property for' the security of the debt. E>ut in the light of those cases, evidently modifying the sfrihgent rule of the common law, we are of the opinion that’ in this case we should hold that the whole estate of the mortgagor passed to he mortgagee and his assigns for the .security of this debt,

Maxwell & Ramsey, for the plaintiff.

Harmon, Colston, Goldsmith & Hoadly, contra.


text:
    (First Circuit — Hamilton Co, O., Circuit Court
    January Term, 1898.)
    Before Cox, Smith and Swing, JJ.
    LOCKLAND LUMBER COMPANY v. ANNA McLEAN MARSH.

      Appeal — Money judgment not appealable because joined parties assert liens—
    Where a party asks a money judgment, the fact that other parties joined in the action with him assert liens, will not entitle such party to an appeal of the. case as against the opposite party against whom he asks a money judgment.

      Appeal in interpleader cases — Sec. 5016, B. S.

    Where money is sued for, and it is brought into court under the provisions of sec. 5016, R. S.,on the ground that there is a controversy as to who is entitled to it, either of the parties is entitled to a trial by jury on such issue, and the case is not appealable.
    On Motion to dismiss the appeal.
   Smith, J.

The plaintiff in this case filed a petition against Anna M, Marsh et al. to recover a judgment against Mrs. Marsh op an account for lumber, materials, etc., furnished her in the construction of a building, alleging that there was a balance due-from her on said account of $616.81, and in a second cause of action asking for the foreclosure' of a mechanic!» lien taken to secure the same. Other persons claiming liens were made parties.

After the service of process upon her, Mrs. Marsh filed •an affidavit under sec. 5016, Rev. Stat., in substance admitting that there was due from her on the construction of such building the sum of $616.81, and that $590.40 of this was claimed by other persons as well as the plaintiff, and •offering to bring the same into court for the parties to settle their rights thereto. She also admitted that she owed the plaintiff on its claim $26.41, and offered to confess a judgment m favor of said plaintiff therefor and for the accrued •costs. On the order ,of the court the said sum of $590.40 was paid into court, and the several claimants proceeded to litigate their rights as to said fund. The plaintiff did not accept the offer of Mrs. Marsh to accept judgment for the .$26.41.

After the trial the court found that Mrs. McLean Marsh •was indebted to plaintiff in the sum of $26.41, and rendered a judgment therefor. The $590.40 was awarded to parties •other than the plaintiff. From this judgment plaintiff attempted to appeal, and the question submitted is whether •such an appeal lies.

Clearly, as against Mrs. McLean Marsh,the plaintiff had no right to appeal. It had two causes of action against-her —one for money only, and the.other for foreclosure of its lien. If there were no other defendants in such case, no appeal could be taken. As it claimed a money judgment against her, under the settled law of this state, no appeal by either would lie, as either party was entitled to a . trial by jury. Does the fact that other parties assert liens against this property give plaintiff the right to appeal as to her? We think not. Under the circumstances, the only way in which the judgment rendered in favor of plaintiff, against Mrs. Marsh could be reviewed would be by petition in-error, and as Mrs. Marsh was a necessary party to the appeal, we áre of the opinion that, on principle, the' same rule must apply to the controversy between the plaintiff and the other defendants as to the fund paid by Mrs. Marsh into court.

Cobb & Howard, for Plaintiff.

Morrow & Oldham-, Drausin Wulsin; OHver' B. Jones-,. Harmon, Colston, Goldsmith & Hoadly; Chas. D'. Irvine-,. John G. OConnell- J. T. DeMfar-, C. L. Lundy, and E.. B. Molony, for the Defendants.

We think, too, that the case of Maginnis v. Schwab, 24 Ohio St., 336, is authority for holding that in a case like-this, where money is sued for, and it is brought into court under the provisions this section, on the ground that there-is a controversy as to who is entitled to it,that,in such case, either of the parties is entitled to a trial by jury on such issue, and therefore that the case is not one for appeal. The-motion will therefore be granted and the appeal dismissed.

Swing, J., concurs.

Cox, J., is of the opinion that the motion should be overruled.


author: Smyseb, J.

text:
    (Fifth Circuit — Licking Co., O., Circuit Court
    March Term, 1898)
    Before Adams, Douglass and Smyser, JJ.
    THE UNION CENTRAL LIFE INSURANCE COMPANY v. F. V. HILLIARD, Administrator.

      Loan by Life Ins. Co. — Requirement to take out insurance on Ufeof some one, to equal amount — When usurious■—
    ' (1). S applied to the U. C. Life Ins. Co. for a loan on ample mortgage security, out was refused unless he also take out a life- , policy in the Ins. Co., to an equal amount with the loan, the same to he assigned to the Ins. Co. as collateral security. S being beyond the insurable age, he thereupon, to secure-the loan, took out a policy on the life of his grandson, a-minor, in the amount of the loan, and executed notes secured • by mortgage, one for the full amount of the loan, and other notes embracing interest at 7 per cent, on the full amount of the loan and the premium on the insurance policy for each of the five years the loan had to run. He received from the Ins. Co. the amount of the loan less the first premium of the-insurance policy. On foreclosure of the mortgage. Held :
    (1) . A grandfather has no insurable interest in the life of his grandson as such,
    (2) . The agreement to pay the premium for the life insurance policy in addition to the interest, amounting to more than the rate of interest allowed by law, was usury
    Error to the Court of Common Pleas of Licking county.
   Smyseb, J.

J. V. Hilliard, as administrator of John Strawn, deceased, filed his petition in the probate court of this county, asking for the sale of certain real estate to pay debts. The Union Central Life Insurance Company was made a party to that action, and answered in the probate court, setting up various notes of Strawn, secured by two mortgages, asserting a lien, and asking that its lien be first paid out of the proceeds of the sale. To this answer and cross-petition of the Insurance Company, the heirs of Strawn filed an answer; and the only defense that is material to be noticed here is that of usury in the loan made by the company to Strawn, and setting out various payments that had been made by Strawn in his lifetime, that ought to be credited upon the indebtedness; and that the rate of interest being usurious, the rate of interest ought to be limited to six per cent instead of seven per cent., as written in the notes. The case was heard in the probate court and appealed to the common pleas, and I did not notice whether it was here or in the probate court, but I think it was in the common pleas, that Hilliard, as administrator, filed as answer to the answer and cross-petition of the Insurance Company, setting up substantially the same facts that had been recited in the answer of the heirs.

In the court of common pleas a finding of facts and law was asked, and that was made, and is before us. A bill of exceptions was also taken, embodying all the evidence, and that is before us.

The whole contention is, that the court below erred in finding from the facts, as the court found them, that there .was usury ,in this loan 'made by the Insurance Company to Strawn.

In 1889, in May, Strawn made an application for a loan of $12,500, He executed five notes; one for $10,500, and four for five hundred dollars each, bearing seven per cent, interest, payable anually. These notes were secured by mortgage. At the same time he executed four notes for five hundred and thirty-two dollars each, bearing the same Tate of interest, and they were secured by mortgage on the same real estate. At the same time or substantially so, a life insurance policy was issued by this company, not on the life of John Strawn, and not on the life of J. H. Strawn, a son who it was contemplated in the first instance was to b.e the party insured, but upon one Edward Roberts, a grandson of Strawn. This policy was for $12,500,and was on the ten year annual premium plan; and out of the moneys that were furnished Strawn by the company, the first premium, five hundred and thirty-two dollars, was retained by the company. Roberts was a minor. It was part of the arrangement, as is found in the finding of facta here, that this policy was to be assigned to the Insurance Company, as collateral security for the loan made to Strawn. Roberts was only about seventeen years of age at the time of this transaction-. By the transaction Strawn was bound to pay by his notes and mortgages the loan mace — the $12,500, and the twenty-one hundred and odd dollars secured by the second mortgage, all bearing 7 per cent, payable annually, while he received from the company but $11,968.0Q. The defense here is usury. What is usury? Usury is th,e demanding, the exacting and receiving by the lender of more than the legal rate of interest. It is contended as against this Company that the giving ofs the notes, and the execution of two mortgages were one transaction, and that the taking out of this insurance policy was - demanded of Strawn as a bonus, and as a condition upon which the loan would be made. It is conceded that the money that Strawn was to. get was $12,500. He was not oh insurable age. His son, who was contemplated to be insured in the first instance, for some reason was declined by the.Company, and the young man, Roberts, substituted.

At the very outset we recur to the 25 Ohio .St., 420, the case of Kilgore v. Dempsey, decision by Judge Gilmore:

“In this case it appears from Indorsements on the note, that no interest was paid till long after the note was due, and it matters not what the parties may have done years afterwards, in continuing or extending the timé of payment of the loan, such subsequent acts will not affect the original transaction and render it usurious if it was not so when entered into.”

It is contended here on behalf of the company, and that is the law, that in order to find this contract usurious, whatever occurred subsequently would not affect it — would not taint it, but that usury must have been present at the inception of the contract. I read from the same authority (25 Ohio St., 420):

“These cases illustrate what shifts or devices are” (having recited various cases) “and the facts from which they will be inferred or presumed. Of course, their name is legion; but whatever they may be, they must enter into and be of the substance of the contract at the time it is made, to make it .usurious.”

But the courts, it is suggested, will look at the transaction, no matter what the shift or device may be that is resorted to for the purpose of disguising the true character of the transaction; courts will look at the transaction as it is, and, if usury is apparent, relief will be afforded.

There is a case in 14 Ohio St., 200, a decision by Judge Brinkerhoff. I read from page 209:

“We think the averments of the answer make out a plain case of usury under those sections of the statute; and one which avoids the paper in its hands tainted with the usury, and any mortgage given to securó it; because such usurious contracts are expressly prohibited by law;” * * * “If a per centum, charged as exchange, or any part of it, was intended as a cover for usurious interest, the form in which it was done, and the name under which it was taken, will not protect the bill from the consequences of usurious agreements; and if the fact be established, it must be dealt with in the same manner as if the usury was expressly contracted for in the bill itself. ”

And I might cite the 90 N. Y., 549. So that the rule is well established that whatever device, or trick, or artifice, or shift may be resorted to for covering up the real transaction, if there was usury, relief can be afforded.

There are two authorities furnished us, 1 McCrary’s Reports, 234, and 2 McCrary’s Reports, 576, that hold that an agreement to take life insurance and pay premiums thereon in addition to the highest rate of interest allowed by law, is usury. They were both life inurance policies issued and a loan of money made at the same time.

In this case, if the insurance was demanded —'required as a condition upon which the loan was made —if it was on additional burden to the interest that was demanded, it would be usurious.

What is the evidence as it appears from the bill of exceptions and the finding of facts ? The young man Roberts is called as a witness; he says he is a grandson; he was then seventen years old, “I was born in 1876; I really didn’t know much about this business; I paid no premium myself; it was done to secure this loan to my grandfather of $12, 500 from said Company. I was not indebted to my grandfather in any way; I was never a partner of his in any way. No policy of insurance was ever delivered to me, and I never saw any policy I was going to school then.” On cross-examination: “I carried out the insurance transaction as they wanted me to.” “Yes, I believe that the application for said insurance was made by me to get a long time loan to grandfather.”

John Strawn is called. “I was perfectly ingnorant about life insurance until they approached me to sign some papers. I heard afterwards my application was not accepted. I had applied first for a policy of life insurance and was rejected.” On cross-examination: “I was told by the company that unless father furnished a party to be insured for the amount of the loan, the company would refuse the loan.”

The deposition of one Clark is here; he is an officer of this company, and says that he was familiar with this loan. —how it was made, and why it was made and all about it; and he sets out the notes and everything that was done. He is asked this question:

“State what consideration, if any, John Strawn, the borrower in this case, received for the signing of these premium notes , to which you have testified, and the execution of the mortgage to secure them. Answer. A policy of life insurance was issued for the $12,500 upon the life of Mr. Roberts, and the same was assigned as collateral security for the mortgage loan to Mr. John Strawn.
“Question. Iam not sure that you' understand my last question. What I desire to know is this: Whether or not the issuing of this policy of insurance, the signing of those notes and mortgage by John Strawn, had any connection whatever with the loan to him of $12,500. A. The loan was dircetly dependent upon this life insurance, it being one of the requirements of the original approval.”

As I have said, what benefit is John Strawn getting from this insurance upon his grandson? He is made, by the contract, paymaster; and he is made paymaster why? He is made paymaster as a condition upon which he can get, not $12,500,but upon which he gets $12,500 with the first premium, $532, taken out. The policy of insurance could not have been, in any sense, for the benefit of John Strawn. And, appearing as it does from this evidence, that more than the legal rate of interest or the rate contracted for was* exacted by the company from Strawn as a condition upon which the loan was made, I call attention to a case in the 7 Ohio St. 387, as furnishing the rule for our guidance-' in disposing of this case. In that case, Mitchell agreed for the sum of four hundred dollars some months in the future to loan Lockwood $8,000. It was apparent upon the-face of the contract that that was usurious. It was a bonus demanded as a condition upon which the loan would be-made. The court say,on page 406.

“Such reasons as these, especially the last, for taking the-bonus of four hundred dollars, only confirm in our minds the belief that the terms of the contract truly state the consideration of the four hundred dollars, and throw so much-suspicion over the only plausible reason given in the answer, to-wit, a compensation for looking to and changing securities, that we have had no hesitation in coming to the conclusion that the transaction is tainted with usury. It would require a clear, distinct and sufficient consideration for the-payment of the four hundred dollars to be alleged and proved, to overcome the usurious consideration stated in the-written contract.”

But, as against this claim of usury,it is urged on behalf of the company that it was competent for John Strawn, as-an independent contract,to effect insurance upon the life of his granuson; that he had an insurable interest in his grandson; and we are cited to-two cases in 94 U. S. 457, 561, as. decisive of the question that the grandfather had an insurable interest in the grandson.

We have examined these authorities, and we do not think they sustain the contention of .counsel in any regard. No-such question was before the court in these cases; on page 457, the court say:

“A policy of life insurance originally valid does not cease to be so by the cessation of the assured party’s interest in the life insured, unless such be the necessary effect of the provisions of the instrument itself. So held, where, súbse- " quently to effecting an insurance by husband and wife upon their joint lives, payable to the survivor upon the death of either, they were divorced a vinculo matrimonii, and she, having thereafter paid the premiums to the time of his death, brought suit on the policy.
“Any person has a right to procure an insurance on his own life”, —mark the language, —on his own life, and assign it to another, provided.it be not done by way of cover for a wager policy. ”

Counsel rely upon a quotation in this case from a decision by Chief Justice Shaw. The case decided was decided by Justice Bradley.

We cannot doubt that a parent has an interest in the life of a child, and, vice versa, a child in the life of a parent; not merely on the ground of a provision of law that parents and grandparents are bound to support their lineal kindred when they may stand in need of relief, but upon considerations of strong morals, and the force of natural affection between near kindred, operating often more efficaciously than those of positive law.”

This case does not go to the extent of holding that a grandfather has an insurable interest in the life of his grandson;-but we are inclined to think, from what appears before us, that there may be some statutory provision in ^Connecticut by which grandchildren and grandparents are bound to care for and support each other. But, in Richards on Insurance, section 27, we think the true rule as to insurable interest is laid down:

“Every person has an insurable interest in the life and health of himself, of any person on whom he depends wholly or in part for education or support, of any person under- a legal obligation to him for the payment of money, or respecting property or services of which death or illness might delay or prevent the performance, and of any person upon whose life any estate or interest vested in him depends.”

. But nowhere do we find it even suggested that a grandfather has an insurable interest in the life of a grandson.

It is said in 94 U. S. :

“The relationship between a party and another for whose benefit he effects an insurance upon his life, if a good and valid consideration in law for any gift or grant, furnishes no ground for the imputation that the transaction was by way of cover for a wager policy.
“A policy of insurance, taken out by a man upon his life for the benefit of his sister, who has no insurable interest in his life beyond that of relationship, is not void; and it is immaterial what is the arrangement between them for the payment of the premium.
“I might say that Chew effected insurance upon his own life payable to his sister, and, in addition to that relationship, he was her debtor.”

See also the authorities cited in the foot-notes of this case, Co-operative Ed. (U. R. R.) Book 24; and also 27 A. R. 321.

There is a case in 2 Am. State Reports, 572:

“A policy of insurance on life.of another,taken by one who had insurable interest in it, for the purpose of assigning it to a third person who had no such insurable interest, is void as a wagering policy in the hands of the assignee.”

It can hardly be contended that this insurance company had any insurable interest in the life of this boy, no matter what the interest might have been of the grandfather. In the first place, they could not contract with him; he was a minor. He never consented to the assignment of this policy.

He went through the manual operation of signing hib name; that is true; but'he was not a party to this transaction. This transaction was had wholly between this insurance company and Strawn, and nobody else. This boyjwas a mere figure head; nothing more and nothing less.

Upon the facts as set forth in this bill of exceptions (and we presume it is the same evidence that was before the court below) we do not see how the court could have come to any other conclusion than that this contract was usurious. In the view we take cf it, the boy was a mere stranger to Strawn.

Follett & Follett, on behalf of Plaintiff.

J. V. Hilliard, J. M. Swartz and Edward Kibler,on behalf of Defendant.

He was clearly a stranger to this insurance company.

That they should exact and receive of Strawn, over and above the $12,500 that he was getting,$2500 more in round numbers, and seven per cent interest on the whole sum,they must have had in mind that they were going to make a profit out of the policy and the premiums that were to be paid over and beyond what the interest was that could be collected by law.

It follows from what I have said that this judgment is right, and must be affirmed.

By Judge Follett: What would they have made if the boy had died ?

Smysek J.: It wouldn’t have helped John Strawn’s estate, because the policy was made payable to the boy’s estate. A.nd it wouldn’t help him pay his $12,500 at all.


author: Price, J.

text:
    (Fifth Circuit — Licking Co.Ohio, Circuit Court.
    April Term, 1896.)
    Before Pomerene, Adams and Price, JJ.
    .(Judge Price of the Third Circuit taking the place of Judge Kibler.)
    THE STATE OF OHIO EX. REL. THE UNION CENTRAL LIFE INSURANCE CO., v. CHARLES W. SEWARD, AS PROBATE JUDGE OF LICKING CO., OHIO.

      Appeal — Oral announcement of decision of court, with instructions to counsel to make computations and prepare decree accordingly — Notice of appeal—

    In an action brought by an administrator in the Probate Court for an order to sell real estate of the deceased in order to pay debts, several mortgage lien holders were made parties, and there was a contest between some of such lien holders as to the amount due on them, and also their order of priority; and the questions arising on such contest were heard and submitted to the court and taken under advisement, until the 18th day of October, at which time the court (there being no trial docket for said court), orally announced the order of priority of the liens and their probable amount, but made no accurate or exact finding of said amounts, and at the same time directed counsel in the case to prepare an entry showing the true amounts due on the several liens and a full finding of facts and a decree accordingly, which was so prepared and filed and entered upon the journal on the 12th dayjof November of the same year.
    Held: The true date of the findings and decree is November 12th, and that a party to such decree may give the required notice and perfect his appeal within the statutory time thereafter; and that a writ of mandamus to compel the Probate Judge (he being his own clerk), to enter said findings and decree as of the 18th day of October, will be refused.
    Mandamus.
   Price, J.

This is a petition for mandamus. In September, 1895, three was an action pending in the probate court of Licking county, between Jonathan V. Hilliard, as administrator of the estate of John Strawn, deceased, and also Jonathan V. Hilliard in his individual capacity, as plaintiffs, and Carrie Sanford, with certain others, together with the Union Central Life Insurance Company, as defendants.

The object of the proceeding, as we gather it, was to sell certain real estate to pay debts, and to determine the amounts, validity and priority of the liens on the premises. The principal controversy, however, was between the Union Central Life Insurance Company, and the other parties plaintiff and defendant who were interested in the premises. Motions to pleadings had been disposed of. and issues were joined,so that on the 22nd of September, 1895,the cause was heard upon its merits. Arguments of counsel were made, and the case submitted to the court for its determination, the result to be announced at some future day, of which counsel for the parties'should have notice. Notice was given for counsel to appear before that court on the 18th day of October,1895, and on that day the court announced oral-' ly its conclusions on the facts and the law of the case, concerning the various questions submitted, and gave to counsel time to make necessary calculations of amounts due, and prepare an entry embracing the same, with the findings and orders of the court which would be proper to follow. No oral announcement was made of the amounts due by either of the parties claiming liens on the premises; nor are we informed that any order or decree was made or announced by the court at that time or on that day; the evidence that we have, being simply that on that day he announced his conclusions of fact and law. Time — no definite period being mentioned — 'was allowed counsel to prepare a proper entry covering the entire case heard and submitted. It further appears that the relator — the Insurance Company, had the larger claim on the assets of the estate which had been converted into money, and, so far as the amount was concerned, was largely interested in having a speedy as well as correct record made of the judgment and decree of the court, and upon its counsel devolved a large part of the responsibility of drawing such entry. Another fact which appears is, that at that time the probate court kept no trial docket nor minute book upon which any memoranda of his findings, orders or decree could be made. On the 12th day of November, 1895, counsel had agreed upon the entry which they had been directed to draft. It was furnished to the court as the entry upon which the parties had agreed, and it was recorded upon the journal as of that day, and showing that the finding, order, and decree of the court were made on November 12th. It is shown that on that day the plaintiff gave written notice of his intention to appeal the case to the court of common, pleas; which appeal was afterwards perfected; and, for that matter, it appears also from the transcript introduced in evidence that the Insurance Company also gave notice of its intention to appeal. But we attach no importance to that, whether it be a fact or not. Nor do we give any weight to that part of the entry wherein the court found that notice of appeal was. given within twenty days, as required by law; because it clearly appears that the entry was made of record- on November 12th, 1895.

.The relator sought, by motion, in the probate court, to correct the entry so as to show that the order and decree were in fact made on the 18th of October; which, if true, and the record would so show, will place the notice of appeal beyond the twenty days allowed by law. This application for mandamus is made asking this court to compel the probate judge (he being his own clerk) to correct the entry made of November 12th. Should we allow the writ? — is the question raised on the facts before stated, and which we find to be the facts in the case.

It is well to look to the sections providing for appeal in such cases from the probate court, because the language of those sections may throw some light upon the subject in controversy. I read first from section 6407:

“In addition to eases specially provided for, appeals may be taken to the court of common pleas, from any order, decision, or judgment of the probate court in settling the accounts of an executor, administrator, guardian and trustee, and assignees, trustees and commissioners of insolvents; in proceedings for the sale of real estate for the payment of debts.”

Then, from section 6408:

“The person désiring to take an appeal, as provided in the preceding section, shall, within twenty days after the making of the order, decision or decree from which he desires to appeal, give a written undertaking, executed on the part of the person appealing, to the adverse party.”

Was there any judgment, order, or decree rendered or made on the 18th of October? Or, on that day, did the court merely announce the lines upon'which a judgment and order would be made, to furnish counsel present, simply an outline or skeleton as to the form the judgment or order would assume when put together and the work completed ? It does not appear that any order or decree was formally or orally announced on the I8th of October; nor was there a finding of any particular amount due to the claimants; but the court did announce the order of the liens. He announced his conclusions of fact and law, it is said. What conclusions of fact, and what conclusions of law? They do not appear in this case. If it is sought to establish, independent of the record, that a certain finding of fact was made by the court, and a certain conclusion of law reached by it, the proof should be somewhat clear as to what such finding and conclusions were. The judgment or order, existing in parol, if it can so exist, must be distinct, in formal and binding terms, even if it be oral, as is the entry of the same when made of record. There must be no more uncertainty as to what the judgment and finding in parol may be, than as to the meaning of the record when the record is made. There was no finding of any1 amount, as we have said, that was due to either party. . If the court found a certain amount due to one or the other of the contesting parties, perhaps an appeal would not be desired. Whereas, if it exceeded^that in any material or substantial sum, an appeal would be desired. That matter could only come home to the party when the calculations had been completed and the entry made. The proof falls below the standard named, we think — the only sa fe standard in this case; and especially'where we are called upon to force, by a peremptory order, the probate judge, or clerk of the probate court, to so change an entry as to show its action to have taken place on the 18th of October, instead of on November 12th.

We hold that there was no finding, judgment, or order made on the 18th of October in the legal sense; that the same were made on November 12th in the legal sense, the time to which the case was passed for the formulation of the findings and the order of the court.

For these reasons, the writ of mandamus is refused, at the costs of relator, and judgment for costs.


text:
    (First Circuit — Butler Co., O., Circuit Court
    Oct. Term, 1898.)
    Before Cox, Smith and Swing, JJ.
    FRED SEIBERT v. ELLEN FOLEY and GUS. WEISBRODT.

      Appeal bond from J. P. — May be amended—
    Where in an action before a J. P. againt two parties, one as principal and the other as surety, plaintiff'recovers judgment against the principal, but her case is dismissed as against the surety, and she files within ten days an appeal bond, reciting only that she intends to appeal from a judgment recovered by her against the principal, when it appears that she entended to appeal also from the judgment against her in favor of the surety, the appellant will be permitted to amend the appeal bond to include the judgment in favor of the surety.
    Error to the Probate Court of Butler county.
   Smith, J.

This is a proceeding in error brought to reverse a judgment rendered in the probate court of this county in favor of Ellen Foley,one of the defendants in error,against plaintiff in error and the other defendant in error, Gus. Weisbrodt.

The record shows that Ellen Foley commenced an'action before a justice of the peace against Seibert and Weisbrodt to recover the amount claimed to be due to heron a several promissory note, executed by them to her. Weisbrodt made no defense, but Seibert filed an answer averring that he was only the surety on said note, as the plaintiff knew when she received it, and that after the'^maturity thereof, a contract was entered into between the plaintiff and Weisbrodt, the principal debtor, and without the knowledge or consent of Seibert, whereby, for a good and valuable consideration, the time of the payment of said note was extended to a certain definite time, (naming it), and that thereby the said Seibert was discharged and released from the payment thereof. On the trial, the justice rendered a judgment against^Weisbrodt for the full amount claimed to be due plaintifif^on the notes, but rendered a judgment in favor of Seibert, dismissing the action as to him at the costs of the plaintiff.

Within ten days, the plaintiff executed an appeal bond, reciting that on May 31, 1894, she had®recovered a judgment against Gus. Weisbrodt on the docket of the justice of the peae for $133.00 and costs, and that she “intends to appeal therefrom to the court of common pleas of Butler county,” and otherwise the bond was in due form.

On the filing of the transcript of the justice and the other papers in the court of common pleas, the plaintiff in due time filed her petition against both defendants setting up her claim against them on the note. Weisbrodt again made default, but Seibert, on leave, again filed an answer setting up the same defensefthab¡he had interposed before the magistrate, and the^plaintiff filed a reply traversing the allegations of the answer. At this stage of the case, under the law applicable to this county, which allows cases appealed from justices of the peace, to the court of common pleas of this county, to be transferred to the probate court, such action was had, and the case was certified by the common pleas court to the"probate court.

After this was done, Seibert applied to the probate court for leave to withdraw the answer Sled by him, and to file a motion to dismiss the action as to him, on the ground that the plaintiff had not appealed the case as to the judgment rendered in his favor before the magistrate, and therefore that there was no case pending in the probate court against him. Such leave was granted,and such a motion was filed.

Thereupon the plaintiff moved the court to allow her to file a new appeal bond, correcting the mistake in the old one if it was insufficient, or to allow her to file a written consent by the sureties on the undertaking, that the bond first given should also apply to an appeal of the case as against Seibert. This motion was sustained by the court, and such leave given, and a second undertaking was filed in court making the appeal apply to both defendants, and in addition to thiB a written consent of the sureties on the first undertaking, that such undertaking should also apply to an appeal of the case as'against Seibert, was also filed. The court then overruled the motion of Seibert to dismiss him from the case. To these rulings, Seibert excepted. Afterward the case was tried, and a verdict and judgment rendered against both defendants. This proceeding in error is brought to reverse the judgment as to Seibert, on the ground that the court erred in permitting the new undertaking to be filed, and in refusing to dismiss Seibert from the case.

The first question prosecuted is whether the court was justified in allowing th9 second undertaking to be filed, if there was a mistake or error in the first. It is claimed by the counsel for Mrs. Foley, that the court had such right under the provisions of section 6595, Revised Statutes, which provides, in cases of appeal from a justice to the court of common pleas that,“in proceedings on appeal, when the surety in the undertaking shall be insufficient, or such undertaking may be insufficient in form or amount, it shall be lawful for the court, on motion, to order a change or renewal of such undertaking, and direct that the same be certified to the justice from whose judgment the appeal was taken, or that it be recorded in said court.”

A majority for the court is of the opinion that under the provisions of this section, if the intention ' of the plaintiff was to appeal the whole case, by mistake,the bond as given did not purport to do'so, that it being insufficient in form to accomplish the purpose, that the court, into which by virtue of the provisions of the statute it had been certified, had full power to allow a new undertaking to be filed to correct this mistake and error in form, and that when it was done, the probate court having jurisdiction of the subject matter of the action and of the persons of both the defendants, the motion to dismiss Seibert from the case was properly overruled. In the first place, it must be conceded that it is the object and purpose of the codes of civil procedure, both in justices’ courts,and other courts of superior jurisdiction, to allow amendments of pleadings, process or proceedings to be made in furtherance of justice, and all technical mistakes to be thus corrected; and to accomplish this, very broad powers are conferred by the statutes, and it is a well settled principle that these remedial laws are to be interpreted with great liberality to this end.

It is apparent, we think, that it was the purpose and intent of the plaintiff below to appeal the case as to Seibert. She had recovered a judgment in the justice’s court against Weisbrodt for the full amount of her claim against him. Why should she have appealed the case as against him alone? It was right if she intended to appeal from the judgment in favor of Seibert, to appeal as against Weisbrodt also, that the case might properly be heard as against both in the appellate court — but there was a reason for the appeal of the case as to Seibert, and doubtless that is what she intended to do.

Nor is it entirely clear that the language of the appeal bond itself does not show that she did so. It recites that she had recovered a judgment against Weisbrodt, and that she intends to appeal therefrom — tnat is,to appeal from the judgment which had been rendered: and as this judgment was one against her, so far as Seibert was concerned, and against the other defendant, it would not be stfaining the language greatly to hold that the notice of appeal was given as to the whole judgment.

Section 5238, Revised Statutes, as to appeals from the court of common pleas to the circuit court, is almost identical in its language as to the amendment or renewal of undertakings given to appeal cases to the circuit court. In the case of Watts v. Sheweíl et al., 31 Ohio St. ,331,it was held that where several judgments are rendered in the court of common pleas against a party who gives general notice of his intention to appeal, and afterwards by mistake executes an appeal bond reciting only one of the judgments, an amendment of the bond may be allowed in the district court, so as to embrace the several judgments. Citing as authority 6 Ohio St., 81; 28 Ohio St., 90, and 31 Ohio St., 131. In a justice’s court no notice of appeal is necessary — the filing of the appeal bond is sufficient, and as the evident purj ose of Mrs. Foley was to appeal from the judgment against her, the case cited shows that in such case the bond, being insufficient in form, might properly be corrected as was done. The judgment of the probate court will therefore be affirmed.


text:
    (First Circuit — Warren Co., O., Circuit Court
    Oct. Term, 1897.)
    Before Cox, Swing and Smith, JJ.
    M. J. HUTCHINSON, Assignee, v. KATE M. STRAUB et al.

      Building association mortgage — Entitled to fines to date of payment—
    A building association is entitled to all fines and penalties accruing up to the date of payment of the mortgage, on Ta buildingj association mortgage providing therefor, on lands which are included in a deed of assignment made by'the mortgagor for the general benefit of his creditors.

      . Mortgagee entitled to rents of property for full payment—
    When the assignee for the benefit of creditors takes the rents from land mortgaged, the mortgagee is entitled to them if necessary to fully pay his mortgage as against the general creditors of the insolvent.
    Error to the Court of Common Pleas of Warren county’
   Smith, J.

The questions presented in this case, arise on the findings of law and of fact made by the court of common pleas, as to the distribution of the proceeds of a sale of certain real estate made by Mr, Hutchinson as the assignee of Mrs. Straub for the benefit of her creditors, and of certain rents which had been received by the assignee from said real estate which acrued after the assignment and up to the day of the sale of such real estate.

The facts as found by the court,briefly stated, are these: On June 12, 1893, Mrs. Straub was the owner of the real estate in question,and on that day she and her husband executed a mortgage thereon to the St. Bernard Loan & Building Association Company, to secure a loan of $3500, which was in the usual building association form, conveying the said real estate,and all of the'privileges and appurtenances to the same belonging, and all the rents, issues and profits thereof, to the association. The question of the mortgage in brief was, that the grantors were to pay to the association according to its'1 constitution and by-laws and without demand therefor, the following sums of money from the date of the mortgage until such time as the dues paid in, together with dividends credited, shall amount to $3500, in the following manner, and (which said Kate M. Straub promised to do) — viz.: 1st, dues — $3.50 per week; 2nd,interest — :$4.20 per week; 3rd,premium of 60 cents per week; 4th, all fines, assessments and penalties which Mrs. Straub should incur, or which might be levied upon'her as a member of said company and in accordance with the constitution and by-laws; and 5th, all taxes, assessments, insurance premiums, ground rents or other charges upon said mortgaged premises; then these presents shall be void. That on January 18, 1896, Mrs. Straub made an assignment to Mr. Hutchinson of all her property, including this real estate,for the benefit of her creditors. That it (the real estate), had been sold under the order of the court in this action for $3575.00, and that the assignee had collected rents from said mortgaged real estate, which accrued subsequently to the assignment, amounting to $335.50 — in all $3910.50, That the taxes on said real estate amounted to $96.30, which the assignee paid. That the costs, compensation of assignee, and his attorney’s fees allowed by the probate court in the action for the sale of the real estate, amounted to $362.60, which the assignee paid. That the amount due the building association, with interest to day of sale, including fines, was $3326.78, on which the assignee had paid $3116.00. That the amount of fines which accrued after the assignment was $64.88. That there were no other liens on said property.

As a conclusion of law the court adjudged that the assignee be allowed credit for all the amounts paid out by him as before found, and that there remained in his hands $335.60, which the court ordered to be disposed of as follows: 1st. That he reserve $100 for the costs accrued, and which might accrue. 2nd. That he pay the building association the balance of its claim, $210 78. And that he hold the balance, $24.82, for distribution according to law.

The assignee thereupon excepted to so much of the decree, as orders the payment of any part of the rent received by him to the building association, and to the allowance to the association of any fines after the assignment, and to the order directing the assignee to pay the coats of this proceeding. And these are the errors alleged to exist in the judgment.

We notice those claims briefly.

In the first place it may be said, that there is not a finding any where made by the court, that there was then a single creditor of Mrs. Straub in existence, cr ever had been except the building association, and the claim for taxes on the part of the state. Why, then, should the assignee have not been required to pay the undisputed claim of the building association against her, out of the proceeds of the sale of the real estate on which it held a mortgage, after paying the taxes, the first lien thereon, and all the costs and expenses in the case, or out of other moneys in his hands for the payment of debts ? And so far as we see, the papers in the case do not disclose that there were any other creditors of Mrs. Straub. Surely in such case, the rents as well as the proceeds of the sale of the land were payable to the only creditor.

But conceding that there were other creditors, what then? It appears from the papers in the case, that before the assignment, on October 10, 1895, Mrs, Straub had rented the land for one year from that date to one Moult-man — the assignment having been made January 18, 1896. It does not appear when the rent was payable — presumably at the end of the term, viz., October 18, 1896. In some cases rent not due is considered as real estate, as for instance between an executor or administrator, and the heir. And in a case of this kind, as it issues out of land mortgaged to the building association, we think it so partakes of the nature of the land itself, that the assignee would hold it as the trustee of the mortgagee rather than for general creditors who had no lien upon the land itself or of the proceeds thereof.

In so far as the question of fines is concerned, we are of the opinion that as their payment was secured by the mortgage, the building association was entitled to a decree for the amount thereof in this case up to the date of the sale, the time^to which they were allowed by the decree. We see no reason why the liability for fines should cease, when the mortgagor sees proper to assign her property to an assignee for^the benefit of creditors. This would be to say that the’mortgagor has the right at her own election to change the terms and conditions of the mortgage executed by her. If this could be done, why could not she or her assignee make the same claim as to the interest, or other payments she bound herself to make?

In the case of Hageman v. .Building Association, 25 Ohio St., 186, the supreme court held that after the breach of the condition of a mortgage given to secure the payment of stated dues, interest on loans advanced, and fines, the decree in an action to foreclose, should be confined to the amount of such dues, interest and fines then due and unpaid.”

In this case the plaintiff, the assignee, took a decree for the sale of the property in question, in the probate court, before a decree fixing the amount of the claim of the building association had been taken. After the sale it was done, and the assignee appealed to the common pleas from that decree. This appeal in substance vacated the finding of the probate court, and in the common pleas, we think that court might have calculated the fines due at the date of the decree there. But they were only calculated up to the-day of'sale. This was favorable to the plaintiff in error, and he cannot complain of it.

The decree ordering the assignee to pay the costs from the fund was not erroneous, and the judgment of the common pleas will be affirmed, with costs.