author: Per CURIAM:

text:
    LE FEBER, Plaintiff-Appellant, v. CITY OF NORWOOD, Defendant-Appellee.
    Ohio Appeals, First District, Hamilton County.
    No. 7352.
    Decided January 22, 1951.
    Stewart S. Cooper, Cincinnati, for plaintiff-appellant.
    Jos. W. Shea, Jr., Norwood, City Solicitor, for defendant-appellee.
   OPINION

Per CURIAM:

This is an appeal on questions of law from a judgment of the Common Pleas Court of Hamilton County, Ohio, in favor of the defendant. Trial was to the Court without a jury.

The pertinent facts essential to a determination of the issues presented are not in dispute.

A part of the evidence presented consists of an agreed statement of facts, duly filed in the trial court.

It appears that the plaintiff had performed certain services for the defendant. There is no complaint as to the character or extent of such services, Payment for such services is specifically provided for in the contract between the parties. This contract provides in part:

“3. The OWNER agrees to pay the ENGINEER as compensation for such professional engineering service a percentage of the entire cost of construction in accordance with the following schedule of basic minimum fees:
“a. Sixty (60%) per cent of the total fee when working or contract plans and specifications with detailed estimates of cost are completed, and bids received and accepted.
“In the event the OWNER does not proceed with the construction of the improvements for which plans have been authorized and prepared as designated 1 (a) above, the OWNER agrees to pay the ENGINEER the lump sum of $15,000.00. In the event of the abandonment of the project, this shall become the only sum due and payable.”

Now the evidence is conclusive that the defendant, for reasons best known to it, has not proceeded with the construction and improvement. A financing program was inaugurated, including the issuance of bonds. The proceeds thereof are in the Treasury of the defendant. It advertised and received bids, but did not accept any. The project appears to be at a standstill. Bids were received in the Pall of 1947. Nothing further has been done. The petition was filed June 24, 1949.

Now, referring to the portion of the contract quoted, it will be noted that it is therein stated — that “In the event the OWNER does not proceed with the construction of the improvements * * * the OWNER agrees to pay the ENGINEER the lump sum of $15,000.00.”

Now two things are clearly undisputed in the evidence. The owner has not proceeded with the construction. There is no evidence that the owner has abandoned the improvement. It will be observed that it is only where such is the case that the sum of $15,000.00 shall be “the only sum due and payable.” Of course, the owner, not having accepted bids, the plaintiff cannot claim payment under the schedule. (Par. 3, (a) supra.)

It is also obvious that the payment of $15,000.00 shall be considered as a credit upon a schedule payment when the owner accepted a bid upon the improvement.

The essential facts and the inferences therefrom being clearly undisputed, it appears to this Court that the plaintiff at this time is entitled to the sum of $15,000.00 as a credit upon a later schedule payment, unless the owner shall hereafter abandon the project.

The judgment of the court of common pleas is, therefore, reversed, and final judgment may be here entered accordingly.

ROSS, PJ, HILDEBRANT & MATTHEWS, JJ, concur.


source: Caselaw Access Project

license: Public Domain

text:
    POET et, Petitioners-Appellees, v. ROSINSKI, Respondent-Appellant.
    Ohio Appeals, Eighth District, Cuyahoga County.
    No. 22108.
    Decided February 26, 1951.
    Nicola & Marsh, Cleveland, for petitioners-appellees.
    Anthony J. Celebreeze, Paul Mancino, Cleveland, for respondent-appellant.
    (DOYLE, J, of the 9th District sitting in place of McNAMEE, J, of the 8th District.)
   OPINION

Per CURIAM:

Sec. 10512-14 GC, provides in part:

“No final decree * * * of adoption shall be entered by the court unless there shall be filed with the court written consent to the adoption, verified or acknowledged as follows:
2. By each of the living parents, adult or minor, except as ' follows:
* * *
0 * * *
d. If it is alleged in the petition that one or both of the parents have wilfully failed to properly support and maintain the child for a period of more than two years immediately preceding the filing of the petition, the court shall cause notice of the filing of said petition and the allegations of such failure to be given such parent or parents as provided in §10501-21 GC. After such notice has been given, the probate court shall determine the issue as to such failure to properly support and maintain the child. The consent of the parent found by the Probate Court to have wilfully failed to properly support and maintain the child for such period shall not be required. * *

Under the provisions of the Code, as above set forth (2-d) trial was held in the Probate Court to decide the issue as to whether the father of two children of tender years had wilfully failed to properly support and maintain them and as a consequence thereof, whether the consent of the parent was necessary in the proceedings for adoption. (The mother is dead.)

Upon completion of the evidence, the court held the parent guilty of a wilful failure to properly support and maintain his children. In the appeal to this Court it is urged that the judgment is “contrary to law and the evidence:” is “contrary to the weight of the evidence;” and that the court erred in “not dismissing the petitioners’ petition as it did not constitute a good cause of action.”

Further the appellant poses the following question:

“Does the mere failure to pay for support constitute ‘wilfulness’ as provided by §10512-14 (d) GC.?”

In answer to the last question, we determine that the “mere failure” in and of itself “to pay for support of minor children” does not under the statute “constitute wilfulness.”

Proceeding now to the sufficiency of the evidence. An examination of the record reveals competent, credible evidence with reasonable inferences to be drawn therefrom, tending to support all of the essential elements of the case. It is not the province of a reviewing court to reverse a judgment simply because the evidence is conflicting. The weight of the testimony and the credibility of the witnesses are questions for the trier of the facts. And in the case under review there was vested in the trial judge alone the determination of the value of the evidence which tended to support the issue, its credibility and worthiness of belief and its weight. We do not find that the judgment rendered is manifestly and clearly against the weight of the evidence, but on the contrary is supported by competent evidence.

The petition as amended does state a good cause of action. The error claimed to arise because the court refused to dismiss it upon motion is not tenable.

In conclusion we expressly determine that the judgment is not contrary to law.

Under the above rulings covering each claim of error, the judgment must be and is affirmed.

Judgment affirmed. Exc. Order see journal.

SKEEL, PJ, HURD, J, DOYLE, J, concur.


author: By SKEEL, PJ.

text:
    PROK, Plaintiff-Appellee, v. CLEVELAND (City), Defendant-Appellant.
    Ohio Appeals, Eighth District, Cuyahoga County.
    No. 22121.
    Decided May 14, 1951.

      A. H. Dudnik, Kohrman & Kohrman, Cleveland, for plaintiffappellee.
    R. J. Shoup, R. C. Green, Cleveland, for defendant-appellant.
   OPINION

By SKEEL, PJ.

This appeal comes to this court on questions of law from a judgment entered for the plaintiff. The plaintiff was involved in an accident and claims that the negligence of one of the defendant’s street car operators was a contributing cause of his injury and damage.

On April 21, 1948, at about 8:00 o’clock P. M., plaintiff was attempting to cross West 65th Street from the west to the east side at about its intersection with Wakefield Avenue. His purpose was to board an east-bound Madison Avenue street car which at that point proceeds north on West 65th Street from Madison Avenue to Bridge Avenue. He had reached a point somewhat past the center line of West 65th Street when he was struck by a motor vehicle then being driven north on West 65th Street by John Perkins. The street car was following behind the north-bound automobile and when the automobile stopped suddenly upon striking the plaintiff, the street car ran into the rear of the automobile, pushing it forward a few feet and in so doing it is the claim of the plaintiff that he received further injuries.

The defendant claims the following errors:

1. In overruling defendant’s motion for judgment n. o. v.

2. That the judgment, is not sustained by the weight of the evidence.

3. In the admission and exclusion of evidence.

4. In refusing to charge on the duty of a pedestrian in crossing a street as is provided by §6307-46 (a) GC.

5. In refusing to submit to the jury findings of fact as requested by the defendant.

6. Errors in the general charge on the subject of speed in over-emphasizing plaintiff’s claims over those of defend-' ant, and in failing to charge that there could be no recovery unless plaintiff suffered injuries as a result of a second impact at the time the street car collided with the automobile of Mr. Perkins.

The defendant’s first claim of error is founded on the admitted fact that the plaintiff received $3500.00 from John Perkins driver of the automobile which struck him as he was crossing West 65th Street.

As the case was originally filed, John Perkins was made a party defendant and the allegations of the petition were sufficient to state a-joint cause of action, These allegations were not changed after Perkins was dismissed from the case. The defendant, by its amended answer, alleged that plaintiff settled his claim with Perkins, receiving $3500.00 in full settlement for his damages suffered in the accident. To this affirmative defense, plaintiff filed a reply alleging that the $3500.00 received from Perkins was not in full settlement but was received upon a covenant not to sue, Reserving his right to continue his action as against the City of Cleveland.

The plaintiff, on cross-examination, testified as follows:

“Q. Mr. Perkins paid you $3500.00 did he not?
A. Yes, sir.
Q. After that you signed a paper releasing him didn’t you?
A. Yes, sir.”

The plaintiff at a later time in the trial, tried to offer a paper writing claimed to be a covenant not to sue that Prok executed in consideration for the payment of $3500.00 and not a release as claimed by the defendant. This paper, marked “Plaintiff’s Exhibit 11” is not in the record because the court sustained defendant’s objection thereto and excluded it. The plaintiff failed to make a proffer of this evidence. The only evidence in the record on this question is therefore as above quoted.

The defendant’s contention under its first assignment of error is that its motion for judgment notwithstanding the verdict should have been granted because the release of one joint tort-feasor releases all. Boyd v. Watt, 27 Oh St 259 at page 267.

In the case of Adams Express Co. v. Beckwith, 100 Oh St 348 the Supreme Court of Ohio held:

“1. A written release in general and unqualified terms, made and executed upon legal consideration between a party wronged and one or more of the persons charged with the commission of the wrong, is presumed in law to be a release for the benefit of all the wrongdoers.
“2. Such written releases, however, are to be construed according to the well-known rules governing the construction of contracts.
“3. Where such written releases expressly provide that the release is solely and exclusively for the benefit of the parties thereto, and expressly reserves a right of action as against any other wrongdoer, such reservation is legal and available to the parties thereto.
“4. Such written release, whether it be a covenant not to sue, a covenant to cease suing, or a covenant in partial satisfaction does not inure to the benefit of any other persons than those who are parties to such written release, save and except that it is a satisfaction pro tanto to the party wronged and to that extent works a discharge to all joint wrongdoers.” (Ellis v. Bitzer, 2 Ohio 89 disapproved and overruled.)

In the case of Garbe v. Halloran, 150 Oh St 476, the supreme court had for consideration a three-way collision. The plaintiff’s car was being driven easterly over the Anthony Wayne Bridge in Toledo. The rear end of her automobile was negligently struck by one Herbig while driving west on said bridge, causing plaintiff’s motor vehicle to come to a stop partly across the inside west-bound lane, there being two eastbound lanes and two west-bound traffic lanes on the bridge. The defendant, then and there driving west about six seconds after the plaintiff’s automobile had come to rest, collided with the side of plaintiff’s automobile, causing further damage to plaintiff’s automobile and personal injuries to the' plaintiff. The plaintiff, on the theory that she had suffered damage in two separate accidents, settled her claim against Herbig for $360.00 and gave him an unqualified release. In holding that defendant and Herbig were joint tort-feasors and that by her release to Herbig she released the defendant, the supreme court held:

“1. Concurrent negligence consists of the negligence of two or more persons concurring, not necessarily in point of time but in point of consequence, in producing a single indivisible injury.
“2. Where the negligence of an earlier wrongdoer remains a dangerous force until the negligence of a later wrongdoer concurs and combines with it to cause injury, the wrongdoers are concurrent tort-feasors and their combined negligence becomes the proximate cause of the injury.
“3. An absolute unqualified release in full satisfaction and discharge of one or more of several joint or concurrent tortfeasors answerable for a single injury implies the receipt of full satisfaction for the injury sustained, and for that reason is a release of all such tort-feasors unless such release contains an express reservation of the right to pursue other of such tort feasors than those so released.
4. Payment by one concurrent tort-feasor for his release from the injured person, even though not in full payment of the damage suffered but only in full payment of the claim of the injured person against him, operates to relieve from liability other concurrent tort-feasors likewise liable for the same tort, unless the injured person reserves the right to pursue such other concurrent tort feasors for the remainder of his damage.”

In the Halloran case there was no issue as to the character of the release. It was unqualified. Likewise, the character of the release in the Adams Express Company case was not disputed. By its terms the plaintiff reserved all rights against other concurrent wrongdoers. But the evidence in the instant case with respect to the character of the release the plaintiff gave to Perkins, was erroneously excluded by the trial court by sustaining the defendant’s objection to its introduction. If, upon a retrial, it should develop that'such release was general in character, and there was no reservation of rights against other joint tort-feasors, then it will be the duty of the trial court to direct a judgment against the plaintiff;, otherwise not. We therefore overrule the defendant’s first claim of error.

The second claim of error is based upon the overruling of defendant’s motion for new trial, it being the claim of defendant that the judgment is against the manifest weight of the evidence.

The defendant upon the submission of the case to the jury requested that if they found the defendant was negligent, to state of what such negligence consisted. The jury answered as follows:

“Cleveland Transit System failed to keep street car under control.”

We must conclude, therefore, that the jury found against the plaintiff on all other claims of negligence', as alleged in his petition.

There were six witnesses, including plaintiff and the motorman of the street car, who testified as to how the accident happened. The plaintiff’s claim is based upon the testimony of Perkins who was the driver of the automobile involved in the accident. He testified that he followed the street car into the intersection of West 65th and Madison Avenue and as the street car turned north over West 65th Street he either at that point'or shortly thereafter, passed it by and proceeded ahead, straddling the east rail of the north-bound track at between 15 and 20 miles per hour. As he was approaching Wakefield Ave., he passed a south-bound automobile. (The record shows it was about 900 feet from Madison Avenue to Wakefield Avenue on West 65th St.) Perkins then testified as follows:

“After I passed the right hand intersection of Wakefield and West 65th Street, a man ran diagonally in front of my car and I struck him with my automobile. I tried to stop but couldn’t. Then I started to get out right away.”

He further testified that the lights of the south-bound car got in his eyes and .when he saw the plaintiff he was only 30 feet away, running diagonally to the east directly into his path; that he slammed on his brakes and was going about six miles per hour when he hit plaintiff; that he started to get out and then saw the street car coming, through his rear-view mirror; that he then set his brakes and the street car hit him a good jolt but he does not know how far he was pushed or whether his automobile hit the plaintiff a second time upon being struck by the street car.

The plaintiff’s evidence was to the effect that he was going to take an east-bound Madison Avenue car; that when he reached West 65th Street, walking east on the north side of Wakefield Avenue, he saw the street car on Madison Avenue 900 feet to the south; that the street car made a left-hand turn into West 65th Street and Perkins’ automobile either passed on the turn or as it started down West 65th Street; that he looked north and saw two automobiles going south; he waited for these to pass and as they did he started to walk to the street car stop; when he saw Perkin’s automobile only a foot away, it struck him and as he lay on the pavement in front of the automobile he heard the street car coming so he pulled himself upon the bumper and as the street car hit the automobile he felt his right leg break.

The credibility of the plaintiff’s evidence is somewhat affected by the testimony of a court reporter who went to the hospital with a claim agent of defendant, five days after the accident. The witness testified from his notes. He says the plaintiff, in answer to questions put by the claim agent, in effect said that the automobile jumped in front of the street car and was only 20 to 25 feet south of him when he first saw it. He further said:

“Yes, he turned in and was going full speed because he tried to pass the street car and there was another car parked at the curb.”

As to this evidence, the plaintiff, in denying that he made these -statements to the claim agent, says that he was “unconscious” although he does remember that he was there. The Sister in charge of the hospital was quoted as saying that the plaintiff was in good condition and not under the influence of any drug.

The plaintiff relies on the failure of the street car to be under such control as to make it impossible to stop before colliding with Perkins’ automobile. There is no evidence as to how close the street car was following Perkins’ automobile and the only evidence as to its speed came from the motorman who said he was travelling between 15 and 20 miles per hour.

There were three other witnesses who were either on Wake-field Avenue at the corner of West 65th Street or on West 65th Street north of Wakefield Avenue. All of these witnesses testified that the automobile of Perkins passed the street car as it approached Wakefield Avenue; that the plaintiff ran from behind the south-bound automobile directly into the path of Perkins’ car; that he was hit and thrown from 8 to 15 feet and that the street car hit the automobile almost at once as it came to a stop.

The assured clear distance rule is not violated when the distance between a moving vehicle and a discernible object is suddenly cut down by some vehicle or obstruction coming into its path so that in the exercise of ordinary care such vehicle or obstruction cannot be avoided. The greater weight of the credible evidence is to the effect that the defendant did not violate the assured clear distance rule or that there was any failure to have the street car under proper control. The trial court should have granted defendant’s motion for a new trial on the ground that the verdict was against the manifest weight of the evidence and the failure to do so constituted reversible error.

The defendant’s third claim of error has to do with the admission into evidence of the stenographic report of the interview between the claim agent of defendant and the plaintiff at the hospital about five days after the accident. The defendant asked plaintiff certain questions, upon cross-examination, as to what he said on this interview about the automobile suddenly coming out in front of the street car, for the purpose of impeaching his testimony given on direct examination. The plaintiff then offered, and the court received into evidence, the entire statement over defendant’s objection.

In this the court committed error prejudicial to the rights of the defendant. It was perfectly proper to cross-examine the plaintiff as to any part of the interview as counsel for the defendant may desire to show contradiction therein with the testimony offered upon trial. The plaintiff could, undoubtedly, upon’redirect examination seek to develop testimony in the statement explaining any seeming conflict, but that does not make the whole transcript of the interview admissible. The plaintiff was in court and testified fully as to his version of the accident. What he said at another time cannot be introduced to support his own evidence. The court should, therefore, have sustained the defendant’s objection to the introduction of the stenographic report of the said interview.

The next claim of error has to do with the failure of the court to permit the defendant to cross-examine one of his witnesses, it being the defendant’s claim that he was taken by surprise because the witness testified on cross-examination that the automobile hit the plaintiff a second time when it, the automobile, was struck by the street car. The defendant claimed to have a written statement from the witness contrary to the testimony.

It is a well recognized rule that where a party is taken by surprise by one of his witnesses he may cross-examine to, if possible, clear up the inconsistency. It was error to refuse to permit the defendant to examine his witness directly as to the two inconsistent statements.

The fifth claim of error is founded upon the refusal of the court to charge the jury on the effect of §6307-46(a) GC, on the duty of a pedestrian in crossing a street at a place other than a cross-walk.

Sec. 6307-46(a) GC provides as follows:

“Every pedestrian crossing a roadway within a municipality at a point other than within a marked crosswalk or within an unmarked crosswalk at an intersection shall" yield the right of way to all "traffic operating lawfully upon the roadway.”

The evidence as to the character of the instruction shows that there was an off-set between the point where Wakefield Avenue intersected West 65th Street from the east, and the point of its intersection from the west, it being ten feet further north on the west side of the street. The street car stop was to the north of the east side intersection. Just how far, if at all, the plaintiff was from the cross-walk is very indefinite and while it might have been of help to the jury to have been instructed upon the rules established by §8307-46 (a) GC, supra, the refusal under all of the circumstances did not constitute error prejudicial to the rights of the defendant.

The sixth claim of error is based upon the refusal of the court to submit to the jury certain findings of fact. These were as follows:

“A. Do you find from the evidence in this case that John Prok sustained any injuries after he was first struck .by the automobile of John Perkins? If your answer to this question is in the affirmative, then answer No. 5. 5. State what those injuries were.”

One of the conclusions reached under the first assignment of error, supra, was that the defendants were joint tortfeasors. If, therefore, it should be established that both were negligent and that such negligence of each was a contributing proximate cause of any injuries sustained by the plaintiff, both would be jointly and severally liable for the full damage.

Garbe v. Halloran, supra:

“2. Where the negligence of an earlier wrongdoer remains a dangerous force until the negligence of a later wrongdoer concurs and combines with it to cause injury, the wrongdoers are concurrent tort-feasors, and their combined negligence becomes the proximate cause of the injury.”

If, therefore, the defendant was negligent which negligence caused injury to the plaintiff, combining with other injuries sustained in the same accident, caused by the negligence of another, the two wrongdoers being joint tort-feasors, it is unimportant to separate, even if it were possible, the injuries sustained as a proximate result of the separate claims of negligence of the several tort-feasors. Both are liable for the full damage. If, however, no negligence is shown against a party claimed to be a joint tort-feasor, or that even though one was shown to have been negligent but no injury proximately resulted from such negligence, no liability could follow and the attempted separation of injuries would have no legal consequence. The court, therefore, did not commit error in refusing to submit findings of fact Nos. 4 and 5, supra.

The other errors complained of have to do with the court’s general charge. One of the claimed acts of negligence in the plaintiff’s petition had to do with the question o'f speed, the charge being that the street car was being operated at a speed of from 35 to 40 miles per hour. The record does not disclose a bit of evidence to support this claim. The court, however, in its charge to the jury, said that operating the street car at a greater speed than twenty-five miles per hour was unlawful. The plaintiff seeks to justify this statement in the court’s charge on the ground that the court was explaining the allegations of negligence contained in the plaintiff’s petition. Even if this were so, the court could not charge or define any claim pleaded that is not supported by evidence.

The court in so doing, committed error to the prejudice of the defendant’s rights. With respect to the rest of the charge we find no error prejudicial to the defendant.

For the foregoing reasons, the judgment is reversed and the cause is remanded for further proceedings according to law. Exceptions. Order see journal.

HURD, J, THOMPSON, J, concur.


author: By HORNBECK, J.

text:
    HALL, Estate of, in re: SOUTHWICK, Plaintiff-Appellee, v. KOCH, Defendant-Appellee, and NEIL, Defendant-Appellant.
    Ohio Appeals, Second District, Franklin County.
    No. 4534.
    Decided January 23, 1951.

      Wm. Harvey Jones, Columbus, for Eugenia Neil, defendant-appellant.
    Irish & Southwick, Columbus, for plaintiff-appellee.
    Joseph G, Rotondo, Columbus, for Lawrence E. Koch, Guardia.», and Martha Louise Koch, an incompetent person, defendasats-appellees.
   OPINION

By HORNBECK, J.

This is an appeal on 'questions of law from an order of the Probate Court made upon issue drawn upon a petition for instructions filed by plaintiff-appellee and answer of Eugenia Neil, defendant-appellant. The cause was presented upon a. stipuMaon of facts.

The -errors -assigned specify the questions for decision-They aire:

1. Error of the 'Court in holding that the trust created by Item HI of the will of Robert C. Hall was not dependent upon the Judgment and 'discretion of George E. Neil the named trustee and consequently did not fail upon the death of said George E. Neil.

2. Error of the Court in holding that the named successor trustee to George E. ¡Neil could serve as such trustee and exercise the discretion vested in George E. Neil by said will.

The facts 'necessary to an appreciation of the questions presented are that Robert C. Hall, deceased, left his Last WIM and Testament which was duly probated. By Item III of the will the testator gave all the residue of his estate, real and personal, to his nephew, George E. Neil, in trust for the following uses and purposes:

“I direct that my trustee reduce all my property to cash and from the proceeds thereof use only so much thereof as is necessary for the care and comfort of my stepdaughter, Mrs. Martha Louise Koch of 295 Tappan Street, Columbus, Ohio, and the decision of my trustee as to the sums of money so expended shall be final.” (Emphasis ours.)
ITEM IV
“However, in the event my stepdaughter, Martha Louise Koch, should die- then in that event I give and bequeath to my nephew, George E. Neil, all those funds remaining in the trust set up in Item III.”

George E. Neil qualified as trustee under the will, sold the property of decedent and thereafter died during the lifetime of Martha Louise Koch. Application was made for the appointment of a successor trustee who was named and is the plaintiff-appellee herein. Thereafter, the petition for 'instructions, to which reference is heretofore made, was hied.

It is the contention of the appellant that upon the death of George E. Neil, the trustee named in the will, the trust fails because the discretion vested in said trustee is so personal and confidential in its character as that it cannot be delegated to a successor. Appellees assert that a trust was designated by the will and that the authority delegated to the trustee was not of such distinctly personal character as that it could not be effectuated by a successor. The Probate Court evidently accepted the viewpoint of appellee, as do we.

The intention of the testator as it affects the power of the Court to name a successor trustee is controlling. The discretion vested in the named trustee was not without limitation but must be determined in connection with the other language of Item III of the will defining the purpose and scope of the trust. Testator directed that from the proceeds of the sale of his residue estate the trustee should use “only so much thereof as is necessary for the care and comfort of my stepdaughter.” This language would have had the identical meaning had the word “only” been omitted from Item III in which event, it would provide that the trustee use so much of the proceeds as is necessary for the care and comfort of the stepdaughter. The discretion of the trustee is not unlimited but must be exercised charged with the obligation that he use so much of the proceeds as is necessary for the care and comfort of the stepdaughter. The testator knew and was charged with the knowledge that the trustee whom he named might not survive him or might not survive the cestui que trust. There is nothing in the Item except the language underscored which indicates a purpose on the part of the testator that the trust shall fail if the named trustee should not survive the cestui que trust.

We do not find that it is impossible for a successor trustee to observe the obligations enjoined upon the trustee named in the will. It is apparent that they may be carried out with reasonable certainty by a successor.

In Hall v. Hall, 24 N. Y. 647, it is held that where a trust provision confides to the discretion of the trustees a matter which may readily be determined by ascertaining certain facts, the discretion is not one that is purely personal. Here the necessities for the care and comfort of the cestui may readily be ascertained by the successor trustee.

The intention to create a trust is definitely asserted by the technical language that the residue estate is given in trust. The cestui que trust is specifically named and the purpose to be effectuated by the trust is clear, namely, that the proceeds of the residue estate, in so far as is necessary, shall be used for the care and comfort of the stepdaughter of testator.

Counsel have briefed the questions presented thoroughly and cited and commented upon many cases. It would serve no good purpose for us to consider all of them. Considerable reliance is placed on Rogers v. Rea, 98 Oh St 315, which case was first decided by the writer of this opinion and reported in 21 O. N. P. (N. S.) 129. The residuary bequest in the will in the cited case was made to C “for any such charitable purposes that he may deem proper and designate in such amounts as he may designate and think best, for permanent or temporary charities,” but C had died prior to the testatrix. It-was held that the discretion vested in the named trustee was so personal in its nature and so comprehensive in its character as to make him indispensable to the validity of the trust. That is to say, that no trust could be created conformable to the terms of the will because the instrumentality through whom the trust would be made effective was not alive upon the death of the testatrix. As was said in our opinion at page 141, the named trustee is necessary that the intention of the testatrix may be particularized; that the will may speak definitely he is the sine qua non.

In the earlier case of Williams v. The First Presbyterian Society of Cincinnati, 1 Oh St 478, the Court said:

“There is no doubt that a trust attached to the property, whoever might hold it; for whenever a person by will gives property, and points out the object, the property and the way it should go, a trust is created.”

In Avery v. Howard, 7 O. N. P. (N. S.) 97, a trustee was authorized to sell property “for such price as he may deem proper.” It was held that this discretionary power was not so personal that a successor could not exercise it.

Moskowitz v. Federman, 27 O. O. 58, had under consideration a will wherein the residue of the estate was bequeathed to a trustee, with full, sole and uncontrolled discretion as to the distribution and disposition thereof, with power to determine the persons, charitable organizations, to whom distributions should be made, the times for distribution and the amounts to be distributed to them, or any of them. The lack of limitation upon the discretion of the trustee in the cited case marks the distinction between it and. the limitation upon the discretion of the trustee here under consideration. To like effect is Page on Wills, Vol. 3, p. 253. These last citations would be applicable had the will of Robert C. Hall, deceased, given full discretion to the trustee to determine the amount of money that should be paid to the stepdaughter without the qualification and the limitaton that so much thereof as is necessary for her care and comfort should be used.

Scott on Trusts in stating the rule as to the survival of the powers of the trustee designated in a will says that the rule is “that powers survive unless the settlor manifested an intention that they should be exercised only by the trustee originally named.” Scott on Trusts, Vol. 2, Section 196.

Re Will of Arthur Doe, deceased, v. Ettenheim, 126 A. L. R. 926, and note, presents full discussion on the powers of a substituted trustee. The case and the note .should be read. At page 936 of the note the annotator observes:

“Where the manifest object of a trust will be defeated if a discretionary power given to the trustee to invade principal or increase income payments is construed as a personal power, the courts will usually infer that the testator or settlor intended that the power should be incidental to the management of the trust and therefore exercisable by a successor trustee.”

Many cases are cited to support the note.

It is evident that as the testator here designated a trust, named the cestui que trust and defined the purpose for which the corpus of the trust should be used, he did not contemplate that it would fail if the named trustee died before the cestui que trust even though he was given wide discretionary power in dispersing the money within the’ limitation defined.

Neither error is well made.

The judgment will be affirmed.

MILLER, PJ, and WISEMAN, J, concur.


author: By PHILLIPS, PJ.

text:
    ARMBRECHT MOTOR TRUCK SALES, INC., Plaintiff-Appellee, v. UNDERWRITERS ADJUSTING CO., Defendant-Appellant, WHITE, Defendant.
    Ohio Appeals, Seventh District, Mahoning County.
    No. 3360.
    Decided December 12, 1950.
    L. M. Cailor, Earl H. Cailor, Youngstown, for plaintiff-appellee.
    James S. Modarelli, Jr., Youngstown, for defendant-appellant.
    H. A. Mills, Niles, for defendant.
   OPINION

By PHILLIPS, PJ.

The parties will be referred to in this opinion as they appeared in the court of common pleas.

Plaintiff sued defendants in that court to recover $896.95 allegedly due it for repairing a trailer belonging to defendant White.

The parties waived trial by jury and submitted the issues in the case we review to the trial judge.

The trial judge entered judgment upon his findings in favor of plaintiff against defendant, Underwriters Adjusting Company, for the amount sought, and in favor of defendant White against plaintiff.

Defendant Underwriters Adjusting Company appealed from the judgment of the trial court on questions of law. As far as we are able to determine from its brief and oral argument defendant Underwriters Adjusting Company contends that the trial court refused its request “for a finding of facts and conclusions of law separately,” and accordingly erred to its .prejudice; and that the finding and judgment of the trial court are not supported by sufficient evidence, and are against the manifest weight thereof.

Though complicated by counsel, the issues in the case we review and the questions presented to us for consideration and determination are simple.

Defendant White owned a tractor and trailer on which a loan company held a mortgage. To protect its mortgage the loan company insured both pieces of equipment. The insurance on the trailer was cancelled, of which cancellation defendant White was notified. Subsequent to cancellation of the insurance on the trailer it was damaged in a collision and removed to plaintiff’s garage.

Defendant Underwriters Adjusting Company advised plaintiff to “have the releases which we have had prepared signed, collect $250.00 from Wayne White and release the trailer, and we will send you the check for the payment of the balance.”

The evidence surrounding the transaction between the parties is such as to leave no doubt of the right of plaintiff to rely upon the liability of defendant Underwriters Adjusting Company to it.

This court cannot, and will not, reverse the finding and judgment of the trial judge on the urged ground that they are not supported by sufficient evidence and are against the . manifest weight thereof.

This conclusion brings us forthwith to consider plaintiff’s other urged error.

“It is mandatory upon a trial judge to make, when so requested, a special finding of fact separately from the conclusions of law, and his refusal so to do constitutes prejudicial error.

“The statutory rights of a party to such a finding is in no, way affected, by the fact his counsel sat silent at the opening of the trial, when the judge announced that he would consent to-proceed with the trial of the case without'a jury only on condition that he should not be asked to prepare a finding of fact and conclusions of law.” Strauss v. Friedman, 2 Oh Ap 11.

Assuming, but not determining, that in the case we 'review it was mandatory upon'the trial judge, upon request of defendant Underwriters Adjusting Company, to make a special finding of fact separately from the conclusions of law in our opinion, the opinion of the trial judge, or finding contained in the transcript submitted to us, is a sufficient finding of facts and conclusions of law stated separately to answer appellant’s request for a separate finding of facts and conclusions of law.

The judgment of the court of common pleas is affirmed.

NICHOLS, J, GRIFFITH, J, concur in judgment.


author: By THE COURT:

text:
    LEYMAN CORPORATION, Intervenor-Appellee, v. PIGGLY-WIGGLY CORPORATION, Defendant-Appellant.
    Ohio Appeals, First District, Hamilton County.
    No. 7350.
    Decided May 21, 1951.
    Peck, Shaffer & Williams, A. J. Conroy, Cottle, Campbell & Druffel, Cincinnati, for intervenor-appellee.

      Nichols,- Wood, Marx & Ginter, Harry Kasfir, John Osoinach, Roy Holmes, Cincinnati, for defendant-appellant.
   OPINION

By THE COURT:

This case was before this Court on appeal in H. S. Leyman Co. v. Piggly-Wiggly Corporation, reported in 68 N. E. (2d) 486, from an order overruling the plaintiff's motion for an order making The Leyman Corporation a party to the action and dismissing the action on the ground that the plaintiff was not the real party in interest.

The notice of appeal which initiated that appeal recited that the appeal was on both law and fact, and the preliminary question as'to whether, on the record, this Court had jurisdiction to hear the case de novo, on the issues raised by the pleadings 'was raised. It was urged in support of our jurisdiction to hear and decide the final issues that the pleadings presented a chancery case, and, on the other hand it was contended that the action was for money only, the issues of fact in which were triable to a jury and that as no equitable relief was sought, no appeal on law and fact was authorized. In view of the fact that there had been no trial ori the merits in the Common Pleas Court, this Court, following Le Maistre v. Clark, 142 Oh St, 1, held that no matter what the nature of the issues, whether legal or equitable, there could be no appeal on law and fact. We, therefore, expressed no opinion as to the nature of the action. The judgment was reversed and the cause remanded for further-proceedings.

In accordance with the mandate, The Leyman Corporation was made a party, and by pleading alleged that it was the beneficial owner of the cause of action, which was the basis of this action.

At the trial, following the remand, the parties agreed that the case should be heard on the evidence that had been introduced at the first trial, supplemented by some additional evidence. At the first trial, the defendant had moved to require plaintiff to elect as to whether it would proceed on the theory of an action at law or as in equity. The court overruled this motion. This motion was repeated at the second trial following the remanding of the case.

We are clearly of the opinion that the court did not err in overruling this motion. We know of no rule that re-quires a plaintiff to label his cause of action. Its classification is determined by the facts alleged.

Basing its contention on the overruling of this motion to require the plaintiff to elect, the defendant-appellant, however, contends that the court denied to it the right of trial by jury. The difficulty with the defendant-appellant’s position in this regard, is that it never demanded a trial by jury and went to trial, to the court without a jury without any protest because of the absence of a jury. By so doing it waived whatever right it may have had to have the issues submitted to a jury. Bonewitz v. Bonewitz, 50 Oh St, 373. We find this assignment of error to be without merit.

This is an action to enforce the liability for rent, taxes, etc., created by the express covenant of Piggly-Wiggly Stores, Inc., contained in a lease to it from Sam Matz and Max Matz, dated November 16th, 1922, for a term of 25 years, commencing January 1st, 1923. There is no doubt that conditioned on the lessors keeping their covenants, the lease bound PigglyWiggly Stores, Inc., as lessees to pay the rent, and there is no doubt that that obligation still persists unless subsequent events discharged it. It is claimed on this appeal that by virtue of certain modification of the terms of the lease in 1924, upon the occasion of the sale or assignment of the lease to William A. Goebel, Piggly-Wiggly Stores, Inc., was discharged from its obligation by operation of law.

There is no doubt the parties to a lease, as parties to any other contract, may agree to the substitution of a third person in the place and stead of one of the original parties, so as to impose the obligation upon the new party and release the original party. Such substitution and release, however, depends upon the intent which may be implied from conduct, but no implication can stand against an express declaration to the contrary. And that is the weakness of the appellant’s position.

William A. Goebel imposed certain conditions in his offer to purchase this leasehold, which could be complied with only with the consent of the lessors. Piggly-Wiggly Stores, Inc., accepted this offer. The lessor agreed to waive the provision against assignment and to consent to the modifications so as to enable Piggly-Wiggly Stores, Inc., to assign the lease, and in this identical written agreement between the lessor and the assignee the lessors expressly reserved their right against Piggly-Wiggly Stores, Inc. The signature to this agreement was witnessed by an agent of Piggly-Wiggly Stores, Inc., who had conducted the negotiations for the sale of this leasehold.

The trial court held that Piggly-Wiggly Stores, Inc., had not been released from its express covenant to pay rent. We are of opinion that the evidence supports that finding.

It is also urged that assuming that Piggly-Wiggly Stores, Inc., remained liable on its covenant, there is no liability on Piggly-Wiggly Corporation, a distinct -corporation, organized under the laws of a different state from that under which Piggly-Wiggly Stores, Inc., was organized. And, of course, Piggly-Wiggly Corporation is not liable on the convenant of Piggly-Wiggly Stores, Inc., unless the. evidence shows that it actually, expressly or by operation of law, or both, assumed such liability.

The facts are that Piggly-Wiggly Corporation organized under .the laws of Delaware, was the owner of a system or method of operating grocery stores. Piggly-Wiggly Stores, Inc., a corporation under the laws of Virginia, was organized to operate grocery stores. It was licensed by Piggly-Wiggly Corporation to use its system, and had about twenty stores in which the system was used. Both corporations were organized on the same day. Piggly-Wiggly Corporation .owned one-fifth of the voting stock of Piggly-Wiggly Stores, Inc., from the beginning, and at the time the lease which is the basis of this action was executed but finally -acquired ninety-eight (98) per cent of such stock, which it owned at the time of the institution of the proceedings to dissolve Piggly-Wiggly Stores, Inc.

In 1928, The Kroger Grocery <& Baking Company obtained control of Piggly-Wiggly Corporation, and thereby acquired control of Piggly-Wiggly Stores, Inc. Thereupon, all the directors of Piggly-Wiggly Corporation and Piggly-Wiggly Stores, Inc., resigned and their places were filled by nominees of The Kroger Grocery & Baking Company. At this same meeting of the directors of Piggly-Wiggly Corporation it was resolved to dissolve Piggly-Wiggly Stores, Inc., and PigglyWiggly Corporation officers were authorized to appoint proxies to vote the stock of Piggly-Wiggly Stores, Inc., owned by it in favor of such dissolution. It was also resolved at that meeting that Piggly-Wiggly Corporation should purchase all the assets of Piggly-Wiggly Stores, Inc., “and assume all of the obligations and liabilities to its creditors of every name and nature and assume performance of all contracts by which Piggly-Wiggly Stores, Inc. was bound.”

In accordance with this resolution, steps were taken at once to dissolve Piggly-Wiggly Stores, Inc., under the laws of Virginia. All known matured debts were paid and the members of the last board of directors became trustees of its assets for administration and distribution purposes. Thereupon, Piggly-Wiggly Corporation made an offer to the trustees to purchase the remaining assets of Piggly-Wiggly Stores, Inc., less a deduction for estimated debts, for the net sum of $1,376,254.16. The deductions mentioned were six in number, one of which was described as “net loss on rent contracts $181,232.25.” The parties recognized that the amount assumed was indefinite.

This offer was accepted and a conveyance duly made in accordance therewith and the assets turned over to PigglyWiggly Corporation. While the transaction, purported to be a sale for cash, as a matter of fact no cash was paid. This resulted from the fact that the purchaser owned 98% of the vendor’s stock and was in effect buying from itself and on distribution would be entitled to receive back almost all that it had paid. The transaction was, therefore, limited to cross-entries on the books, with an arrangement under which PigglyWiggly Corporation supplied the money from time to time to the trustees of Piggly-Wiggly Stores, Inc., with which they satisfied the claims of the owners of the 2% of stock owned by others.

During the process of dissolution of Piggly-Wiggly Stores, Inc., and the acquisition of its assets, no mention was made of any liability arising out of the lease from Matz to Piggly.Wiggly Stores, Inc. It was not listed as a liability on the books of Piggly-Wiggly Stores, Inc., and it is conceded that the officers of Piggly-Wiggly Corporation had no knowledge of its existence. While a reserve was established to take care of loss on rent contracts, it is conceded that rent undér this lease was not contemplated by that reservation. However, the reservation of this ' amount was in harmony with its intention to assume all the liabilities of Piggly-Wiggly Stores, Inc., expressed in the resolution passed at the meeting at which it was determined that Piggly-Wiggly Stores, ■ Inc., should be dissolved. It- is clear that Piggly-Wiggly Corporation intended to assume all the debts of Piggly-Wiggly Stores, Inc., and this was so understood and acted upon -by the latter. It was given a deduction from the purchase price because of its agreement to pay the debts. It was mistaken as to the amount of those debts. In view of the breadth of its expressed intent to assume every obligation of whatever nature or description and in view of the fact that there was no recession from that position at any time, we are of the opinion that the trial court’s finding that Piggly-Wiggly Corporation’s actions in and about the dissolution of PigglyWiggly Stores, Inc., had the effect in law and equity of rendering Piggly-Wiggly Corporation liable for the obligations of this lease, finds adequate support in the evidence of the conduct and expressed intention of the parties. The liability is based on a contract between Piggly-Wiggly Stores, Inc., and Piggly-Wiggly Corporation for the benefit of the creditors of Piggly-Wiggly Stores, Inc., which included the plaintiff. The liability of the promisor to the third-party beneficiary is well established in the law. In Section 136 of Restatement of the Law of Contracts, it is stated that “A promise to discharge the promisee’s duty creates a duty of the promisor to the creditor beneficiary to perform the promise.” And in Section 139, it is said: “It is, not essential to the creation of a right in a donee beneficiary or in a creditor beneficiary that he be identified when a contract containing the promise is made.”

The facts in this case present a situation requiring the application of other principles leading to the same conclusion. When Piggly-Wiggly Corporation took possession of and title to the assets of Piggly-Wiggly Stores, Inc., which upon its dissolution had become a trust fund, without paying anything therefor, it became a constructive trustee for the benefit of all those having enforceable claims against Piggly-Wiggly Stores, Inc. In 54 Am. Jur., 446, it is stated that:

“The beneficiary of a trust who is a party to the contract giving rise to a trust may recover damages for its breach. He may, where he is not a party to the contract, recover as a third-party beneficiary in a jurisdiction where third-party beneficiaries can recover for breach of a contract. Also, where a trustee withholds which in conscience he should not be allowed to retain, the beneficiary may recover on the common counts, at least where the amount due him has been established and made certain and is immediately owing to him. But it has been held that a trust cannot be enforced as such by an action in common counts on an implied promise. A transferee of trust property, not protected as a bona fide purchaser for value and in good faith, may be proceeded against for money had and received.”

The imagination of counsel has conjured up situations where many stockholders had received assets and where many unpaid creditors existed scattered over many states, and has pointed out many difficulties that would ensue if a single simple creditor were permitted to pursue a single stockholder. There is no doubt that when a debtor corporation dissolves and distributes its assets among its stockholders a difficult situation is usually presented to the creditors, notwithstanding the existence of all the remedies afforded by both law and equity. There is, however, no necessity for adding to those difficulties. In this case there is just one creditor. It is not suggested that there is any other except - possibly one other having a claim of less than $50.00. It is admitted that the defendant received assets worth many times the amount of the plaintiff’s claim. Under such circumstances, we can think of no sound reason for requiring the plaintiff to file an action against Piggly-Wiggly Stores, Inc., which no longer exists and has no assets, before it will be permitted to proceed against the defendant that is under obligation to the plaintiff and has the assets with which to respond.

As one of the defenses urged here is that the proceedings under the laws of Virginia whereby Piggly-Wiggly Stores, Inc., was dissolved, constituted a bar to this action, it should be said that no matter upon which legal theory the defendant’s obligation is based, the Piggly-Wiggly Stores, Inc., dissolution proceedings could have no effect upon it. The liability of a promisor upon his promise to a promisee to pay a creditor-beneficiary is in no way dependent upon the continued existence of the promisee. If the promisee is a natural person, his death would be no defense to an action by the creditor beneficiary against the promisor. The dissolution of a corporate promisee could have no greater effect. If defendant’s obligation is placed on the basis of receipt of assets without consideration, whereby imposing upon it by operation of law the duty of a constructive trustee, the obligation is likewise unimpaired by the dissolution of the promisee. The fundamental reason applicable under both theories is that the plaintiff is not seeking to enforce a duty of PigglyWiggly Stores, Inc. It is seeking to enforce an independent obligation of the defendant. We look to the original obligation of Piggly-Wiggly Stores, Inc., as the measure and terms of defendant’s obligation, and for no other purpose.

It is urged, however, that the defendant was released from this obligation by reason of the modifications in the terms of the lease at the time of the assignment by Piggly-Wiggly Stores, Inc., to Goebel. It is sufficient answer to this to say, as already noted, that there is ample support for the court’s finding that these modifications were made at its .request and with the express reservation of the liability of Pigglyr Wiggly Stores, Inc., upon its covenant to pay rent and that Piggly-Wiggly Stores, Inc., knew of this reservation at the time and consented to it.

It is also urged that the plaintiff after default in payment of rent re-entered the leased premises in its own right and thereby effected a surrender of the lease which would have the effect of terminating the obligation to pay rent which would otherwise accrue in the future. The trial court found that nothing that the plaintiff did or failed to do after taking charge of the premises was in violation of the terms of the lease, or released the original lessee, its successors and assigns from the obligations thereof. An examination of the record discloses that what the plaintiff did was for the purposes of preserving the property and minimizing the damage resulting from the default in the payment of rent and not for the purpose of accepting a surrender of the leasehold,— and it did not have that effect in law.

Finally, it is urged that the statutes of Virginia or Ohio, or both, bar the action. That the Virginia statute is inapplicable, in our opinion, is manifest from what has already been said as to the nature of the defendant’s liability. The cause of action did not arise in that state. The breach occurred in Ohio. And as to any applicable Ohio statute, we are of the opinion that the unpaid balance of rent accrued well within the limitation imposed.

We find no error in the record, prejudicial to the appellant.

The judgment is affirmed.

HILDEBRANT, PJ, MATTHEWS & ROSS, JJ, concur.


author: By DRUCKER, J.

text:
    HORVATH et, Plaintiffs, v. GORMAN, Defendant.
    Municipal Court, Cleveland.
    No. A 190338.
    Decided March 30, 1951.
    A. B. Toth, for plaintiffs.
    Morris Morgenstern, Cleveland, for defendant.
   OPINION

By DRUCKER, J.

This is an action in Forcible Entry and Detainer with a second cause of action for rent. Plaintiffs in the petition allege that they are the owners of an apartment house at 509 Literary Road, Cleveland, Ohio in which the defendant occupied a suite consisting of four rooms and bath, unfurnished, heat and utilities supplied by the owners, on an oral tenancy, from month to month at a monthly rental of $46.00.

The petition stated that the defendant was in arrears with the rent for the month of December, from December 1st to December 31st, 1950 inclusive and for the month of January from January 1st to January 31st, 1951, inclusive; that “there is due and owing plaintiffs from the defendant for rent of aforesaid premises for the months of December, 1950 and January, 1951 which is payable on the first day of each month in advance, at the rate of $46.00 per month, the total sum of $92.00 for which amount, together with costs, plaintiffs pray judgment.”

The evidence adduced was to the effect that there had been a tender of the maximum rent by the defendant for the month of December but that the landlord refused to give the tenant a receipt and thereupon the tenant did not again offer the money due for the rent. There was some evidence to the effect that the tenant had sent a money order to the landlord by mail which the landlord did not return but had advised the tenant that he was not accepting it as rent and that he was holding it merely for evidence.

The court finds nevertheless that the tenant was within his rights to demand a receipt and that he was under no obligations to continue to offer the payment unless the landlord did in fact give him a receipt.

In this connection the court feels that there ought to be some definite expression on what seems to be the confused view as to the effect of a tender of a money order through the mail and the legal effect of such offer by the tenant. The court is of the opinion that the rule laid down by the Area Rent Office to the effect that a tenant need not pay the rent if the landlord refuses to give a receipt for the amount of rent that is offered, is a valid provision and will be recognized by the court. The tenant is under obligations to pay the maximum rent, to make such offer to the landlord and the tenant is not within his legal rights in insisting that the landlord give him credit or deduct any sum from the rent because of any overpayment which had been made by the tenant above the maximum rent. The tenant is protected by the rules which provide a course of action in those cases where over-payments have been made. The landlord is within his rights to expect the tenant to continue paying the maximum rent regardless of the number of months for which the tenant has paid more than the rent which had been determined as the maximum rent by the Rent Area Office.

In the present case the tenant contended further that it had been his practice to pay the rent after it had accumulated beyond due date and that the landlord had continued to accept the rent when tendered. Because there had been an offer of the rent by the tenant for the months of December and January after the due date of the rent the landlord had refused to accept the rent and filed his action for Forcible Detainer on the ground that the tenant had failed to pay the rent when due. Unless there is a definite agreement and custom the tenant is under no obligation to pay the rent in advance. Parks v. Dunn, 46 Abs 6, decided May 8, 1946. The defendant contends that the continued practice of the landlord to accept rent after due date had become a custom and usage and that the failure to pay the rent on the day due had been waived by the landlord. In Parks v. Dunn, 46 Abs 6, the court after expressing its approval of the Musselman v. McCormick, 42 Abs 536 states “we cannot force either a custom or a contract between this tenant and former owners upon this tenant and the new owner, the plaintiff in this case. A new landlord is free to enter into any new rental contract subject only to the maximum restrictions placed upon all parties by the rental regulations of the O. P. A. The approval by the O. P. A. of a former arrangement restricts the subsequent owners and occupants, but does not and can not deprive them of their right under Ohio law to enter into a new agreement. We find as a matter of fact that no new agreement was entered into in this case. Parks v. Dunn, 46 Abs 6. This view was entertained by the court even though in Pillot v. Moss, 72 Oh Ap, 492, where the court states no acceptance of payment of rent is shown where landlord without cashing them, holds as evidence money orders for such payments.

There have been decisions involving the offer of a money order and the sending of the money order by the tenant to the landlord by mail. In this area the practice had been fostered, encouraged and given impetus by the advice, and counsel of the personnel in the Rent Area Office. Tenants have established the practice as a result of the advice of that office and the court had been confronted on many occasions by the question of whether or not money order sent to the landlord by the tenant was a good and sufficient tender and whether or not the landlord could maintain his action in Forcible Detainer on the nonpayment of rent on the theory that though he had received the money order and though it was for the amount of rent due he was under no obligations to accept it as payment of rent but that he could hold it purely as evidence without returning it and proceed in his action for nonpayment. This view seems to be in line with the case in Ohio, “A postal money order sent by the tenant to the landlord in payment of rent and received and retained by the landlord without cashing it, where the evidence does not show the money order was being held for evidentiary purposes, and where the tenant was not informed that such money order would not be accepted in payment of the rent and where said money order was not tendered back at the time of trial, is considered as accepted in payment of rent.” Hile v. Besecker, 82 Oh Ap 301, decided November 12, 1947.

“Where a tenant delivers a money order and the landlord rejects it without a statement that the ground for objection is the medium of payment, the tender is not thereafter open to objection. Such condition constitutes a waiver of legal tender statutes. Acceptance may be implied by operation of law or by estoppel where the landlord retains possession, for more than a reasonable time, of money orders tendered by a tenant even though the tender was made after the rent was due, however following Pillot v. Moss, 27 Oh Ap 428, no acceptance of payment of rent is shown where the landlord retains money orders, without cashing them, for use as evidence providing such landlord continually asserted that such money orders would not be and were not accepted as payment and this assertion was communicated to the tenant. In such a ease the money order must be introduced in evidence, rejected and tendered back to the tenant. If restitution is granted the money orders become the property of the tenant. Although a money order is not legal tender, if tender of such an order is refused but not on the grounds of the medium then the medium can not later be objected to. The landlord can keep the money orders for evidence purposes but when’ he exerciss dominion over them he waives the medium and it may be considered a tender.” 45 Abs page 555, Wilkie v. Smith (1946).

“A tender of a money order in payment of rent is equivalent to a tender in lawful money where no objection is made' to the medium of payment. Where, on the 29th of a month, a month to month tenant mailed to the landlord a money order in payment for rent for the following month and two days later — the 31st the landlord gave notice to the tenant to vacate and acknowledged receipt of the money order, stating it was not accepted as rent but it was being held for evidential purposes only, but at the subsequent Forcible and Detainer trial the landlord neither offered it in evidence nor tendered it back to the tenant such money order must be considered as rental for the month for which it was tendered by the tenant.” Schmidt v. Hummell, 81 Oh Ap 167.

Where plaintiff received a money order sent by defendant in payment of rent and retained such order in her possession until the day of the trial when it was tendered into court and ordered held by the court pending the outcome of the litigation, and plaintiff failed to notify defendant that the order was being held for evidentiary purposes, such tender into court did not constitute a tender to defendant, and the retention of such order' under such circumstances amounted to an acceptance of it in payment of rent. 86 Oh Ap 25, 85 N. E. (2d) 401.

Acceptance may be implied by operation of law or by estoppel where landlord retains possession for more than a reasonable time of money orders tendered by a tenant even though tender was made after rent was due; however, following Pillot v. Moss, 27 O. O. 428, no acceptance of payment of rent is shown where landlord retains money orders without cashing them for use as evidence, providing landlord continually asserted that money orders would not be and were not accepted as payment and this assertion was communicated to tenant; in such case, money order must be introduced in evidence, rejected and tendered back to tenant; if restitution is granted, money orders become property of tenant. 45 Abs 555, 68 N. E. (2d) 386.

Rent accrued and unpaid at the time of sale of rental property is due and payable to grantor in absence of an agreement for payment to grantee. 53 Abs 181, 82 N. E. (2d) 547.

Where landlord held money order tendered by defendant tenant for rent, and failed to inform tenant that he held it for evidentiary purposes, that it was not accepted as rent, and failed to tender it back to tenant on or before day of trial, such retention constituted an acceptance of rent, a tender of such money order into the court is not a tender to the tenant. 54 Abs 463, 85 N. E. (2d) 401.

It is conceded that in the absence of any agreement the rent is not payable in advance but on an accrual basis it is payable on the premises. Park v. Dunn, 46 Abs 6.

“An express contract regarding the time and payment of the rent may be entered into and payments made and accepted after the date of the express contract but that in and of itself, those payments may not establish a custom of usage or waiver of date due by the landlord.” Musselman v. McCormick, 42 Abs 536 (1943).

The landlord has the right to determine the method of payment, the time and the place. The landlord can accept or refuse the money order. The tenant cannot by mailing it or tendering it create an acceptance. The landlord can return it. He can retain and notify the tenant he is not receiving it as rent but he ought not to be permitted to retain it for any unreasonable length of time and then argue it was being kept for evidence and deny that there had been a legal tender. He has a right to accept payments after the due date and after that has been done for a considerable period of time he ought not to be permitted to claim a default of rent on the part of a tenant unless the tenant has been advised that in the future the time of the rent due date will not be waived. It is also conceded that currency which has been made suitable by law for the purposes of a tender in the. payment of debts may not specifically include postal money orders although by the Act of Congress, approved July 17, 1862 a postal currency was authorized. This was receivable in payment of all dues to the U. S. less than $5.00. They were not however a legal tender in payment of private debts. The function of the court is not to legislate nor to establish economic principles which are not rooted in reasonable interpretations of our law but to be the barometer of human progress and keep pace with economic and business currents of the day. Our business people have been accustomed to accept money orders as completely satisfactory payments.

Our government agencies are urging that the public use the medium of money orders as a safe method of transmission of monies. The public is induced to rely upon the integrity of our government and the soundness of our treasury in purchasing these money orders. It is not merely an order upon a bank nor an order upon the government but it is the assumption of the government of the obligation to pay. There can be no stronger medium of exchange between the government and its citizens and the citizens themselves. It is a service which the government renders for which payment is made by the citizen. It has become part of the usage and custom of trade. Banks, business houses, merchants have accepted money orders as good and sufficient payment. The public, induced by the appeals of the postal authorities of the United States has accepted this as a medium of exchange. It certainly ought not to be the prerogative of the landlord to refuse to recognize money orders as good and sufficient oilers of the payment of rent. It does not subject them to any inconvenience of transmission of exchange or of deposit. The landlord ought not to be permitted to set up exclusive standards for himself which are not made available to the public, to the merchant and to the tradesman. The tenant has found in the use of money orders a means of assuring himself of its proper transmission and of the possibility of using the receipt as evidence in court to establish the fact that the rent had been offered. To conclude otherwise would be imposing upon the great mass of population an unnecessary hardship. The tenant should have the right to protect the safety of his money by availing himself of the means and methods which his own government provides. Certainly the Post Office authorities do not encourage nor even look with favor upon the sending of cash through the mails. We are not in accord with the conclusion as expressed in the recent case in Ohio but we are convinced that the courts should take cognizance of the moving currents in our business and commercial life and that we should expedite the more readily acceptable means of transmission of funds through the mail.

The tenant ought not to be subjected to the necessity and hardship of seeking out the landlord if he can not be found, nor go to expense in travelling to his home or subject himself to the inconvenience of continued hours of transportation to deliver the rent to the landlord when he can follow the custom of transacting his business with the landlord through the mails and protecting transmission of rent through the agencies to the courtesies extended to him by him own government. Although money orders may not come strictly within the interpretation of legal tender we feel that the court should be realistic, practical and take cognizance of a well established custom and a reasonable and business like procedure.

The court therefore finds that in this case the defendant is not guilty; that there had been a tender of the rent and that the tenant was within his rights to offer the landlord the maximum rent due in the form of a money order which the landlord should have accepted. The tenant can not be said to have been in default because the offer to pay the rent was made by tendering a money order.

The court finds further that custom and usage of accepting rent after date due had been established and that the landlord had waived any legal right of any express contract of accepting payment only upon the date due. There had been a modification of that express contract which had become a recognized custom and practiced usage.


author: By HORNBECK, PJ. By THE COURT.

text:
    CAST STONE COMPANY, INC., Plaintiff-Appellee, v. McGOWN, Defendant-Appellant.
    Ohio Appeals, Second District, Franklin County.
    No. 4510.
    Decided March 27, 1951.
    John L. Davies, Jr., Columbus, for appellee.
    Herbert & Dombey, Columbus, for appellant.
   OPINION

By HORNBECK, PJ.

This is an appeal on questions of law from a judgment of the Common Pleas Court in favor of plaintiff quieting its title to certain premises, situated in the City of Columbus, as described in the petition. The petition is in the usual form in actions to quiet title.

The answer avers that the defendant is the owner of a mortgage on the premises described in the petition which mortgage secures a nóte in the sum of $10,000.00; that “no payments have been made upon said mortgage and that the plaintiff knew of the existence of said mortgage, and knew that defendant was the owner of the real estate described,” and denies generally all other allegations of the petition. The prayer is that the petition of plaintiff be dismissed and that the Court find and declare that defendant’s mortgage be a' valid subsisting mortgage upon the real estaté described in the petition. The amended reply sets forth the source of plaintiff’s title and the giving of the original note of $10,000.00 and mortgage securing it and the endorsements bn the note as claimed by plaintiff. They vary somewhat from our interpretation of them, as hereafter stated. After the special averments the reply consists of a general denial.

Most of the facts essential to an appreciation of the legal questions presented are undisputed. They are that, in 1930 the plaintiff acquired the premises described in the petition from the First Citizens Trust Company of the City of Columbus for a consideration of One Dollar ($1.00) and other valuable considerations. In the habendum clause of the deed appeared this language:

“that the said premises are free and clear from any incumbrances whatsoever. * * *; and excepting also a certain first mortgage in the principal sum of Ten Thousand Dollars ($10,000.00) held by Orrin Thacker, Sr.; * * * which mortgage, the grantee herein does not assume nor agree to pay.”

In the warranty clause appears this language:

“and that it will forever Warrant and Defend the same, with the appurtenances, unto the said Cast Stone Co., Inc., its successors and assigns, against the lawful claims of all persons whomsoever except as above but only as to incumbrances or liens arising by, through or under the grantor herein.”

In 1920 the defendant, then Nancy Thacker, was the wife of Fred Thacker whose father was Orrin Thacker. In that year, Mrs. Thacker’s husband died leaving proceeds of life insurance to his widow in the amount of $20,000.00 Orrin Thacker, the father-in-law, advised defendant that he wouid invest this money for her.

In 1928, Harvey G. and Florence Price made a mortgage to F. C. Smith securing a note of $10,000.00 payable to Smith. This mortgage, defendant’s Exhibit 5, covered the property described in the petition.

We will refer to the endorsements on this note by number. Endorsement Number -One is “Pay to Nancy Thacker without recourse to me.” Signed, “F. C. Smith.” F. C. Smith was a brother-in-law of defendant. The exact date of this assignment does not appear. By it the defendant became the owner of the note. The possession of this note and mortgage securing it was then, and at all times thereafter, in the possession of Orrin Thacker except when it was up as collateral, at the time of the making of a contract of October, 1938, and when defendant had it for the purpose of endorsement.

Endorsement Number Two is “Nancy Thacker.” Respecting this endorsement it appears that defendant notified Orrin Thacker that she desired to get some money and thereafter he negotiated a loan for her with the Perry County Bank, New Lexington, in the sum of $500.00, defendant pledging the note as collateral security for the loan and making the endorsement thereon. This $500.00 loan was paid and the $10,000.00 note was probably returned to Orrin Thacker.

The third endorsement on the note is “Nancy Thacker Lyons.” This endorsement was made in 1933 when the defendant was the wife of a man by the name of Lyons. It appears that in 1933 defendant again suggested to Orrin Thacker that she needed money as a result of which she secured a loan of $500.00 from the Crooksville Bank and gave her note in that amount. To secure this note she pledged the $10,000.00 note as collateral and this was the transaction wherein the third endorsement “Nancy Thacker Lyons” was placed upon the note in question.

The next endorsement on the note, Number Four, without date, is “Pay to the order of Orrin Thacker or order without recourse.” Signed, “J. L. Bennett.” “Orrin Thacker.” J. L. Bennett was then the President of the Crooksville Bank.

Endorsement No. One is on the mortgage, which being also on the note proves conclusively that the defendant at that time was the owner and holder of the $10,000.00 note and mortgage. Endorsements No. Two, Four and Five are not on the mortgage. Endorsement No. Three, “Nancy Thacker Lyons” is on the mortgage.

C. M. Bennett, Vice President and Cashier of the Crooks-ville Bank, testified, and offered a letter from the bank to support his statement, that in 1934 the bank proposed to the defendant that she renew a $500.00 note adding the year’s interest thereto; that the note was not renewed and that in his opinion it was paid. Who paid-it and under what circumstances does not appear. In any event, up until that time the defendant was the owner of the $10,000.00 note subject only to the payment of the $500.00 note. If it was paid she owned the $10,000.00 note absolutely and was entitled to its possession and the possession of the mortgage; nor, could the title to this note pass to any other except by the act of the defendant Or her agent authorized for that purpose. The bank, if it was paid, had no authority to endorse it to anyone other than the defendant because it was not claimed that it was sold or negotiated to liquidate the note which it secured. There is no proof that defendant by any act of her own intended at any time to transfer the note to anyone other than the two banks and for a special purpose. This fact was known to Orrin Thacker.

In November, 1930, an Article of Agreement was made between Orrin Thacker and Nancy Thacker, parties of the first part and the Cast Stone Co., Inc., Willard Peterson, D. E. Hinds, and I. J. Poit, parties of the second part. This agreement, among other things, recites that the parties of the first part are the owners of the $10,000.00 mortgage, that on November 24, 1930, interest in the amount of $650.00 will be- due which •interest it is agreed should be paid by second parties as set forth. It further récites that the interest shall be paid according to the terms and conditions of the mortgage except that the interest should be reduced from 6Yz% to 6% per annum. There was a condition that the due date on the mortgage should be extended to November 24, 1934. There are other provisions in the agreement which are of no probative effect here.

On October 10, 1938, Orrin Thacker, as party of the first part, and the plaintiff, as party of the second part, entered into a written agreement by the terms of which Thacker sold to the plaintiff the $10,000.00 mortgage for the sum of $2,000.00. This formal instrument is the source of title to the mortgage here under consideration. It recites that,

“whereas the said Orrin Thacker, * * *, is the owner and holder of a first mortgage calling for $10,000.00 (Ten Thousand Dollars) signed by Harvey G. Price and wife, dated November 24, 1928. * * *

“Now the said Orrin Thacker, * * *, hereby agrees to sell to parties of the second part, the mortgage above described Ten Thousand ($10,000.00) Dollars for the sum of Two Thous- and ($2,000.00) Dollars to be paid as follows: * * *.

“It is understood that said second party” (Cast Stone Co., Inc.,) “agrees to deposit with party of the first part, the $10,000.00 mortgage and note as collateral security for the payment of said $2,000.00 which is to be signed by the party of the second part.”

It will be noted that the contract recites that Orrin Thacker is the owner and holder of the mortgage. By implication only it may be said that he represented that he was the owner of the $10,000.00 note. In any event, the second party agreed to deposit it with Thacker which would imply that he turned it over temporarily, constructively at least, to the Cast Stone Co., Inc., by virtue of the agreement. As we interpret this agreement it is to all intents and purposes an attempted transfer of the note and the mortgage securing it by Orrin Thacker to the Cast Stone Co., Inc., and the transfer in .both instances was tantamount to such an endorsement upon the note and mortgage.

On April 30, 1948, Margaret E. Thacker, administratrix of the Estate of Orrin Thacker, deceased, signed a release of the mortgage under consideration to the plaintiff which release recites that the mortgage had been assigned by Nancy Thacker Lyons to Orrin Thacker; that the mortgage and note secured thereby were in the possession of the releasor and that upon full payment thereof were cancelled and delivered to the plaintiff who paid the balance on the mortgage and note. The statement in this release that the mortgage had been assigned by Nancy Thacker Lyons to Orrin Thacker finds no support in the record. Nor, is the statement that plaintiff had made full payment of the note and mortgage borne out by the evidence. This instrument was signed after the executrix had been discharged and the estate closed.

We then come to consider some of the questions projected by this appeal. Four errors are assigned to the judgment which we discuss generally.

The parties devote most of their attention in their briefs to a discussion of the law of agency as it affects the rights of the parties. Mr. Hinds, president of plaintiff company, states that he dealt with Orrin Thacker in the transaction, the subject matter of the agreement of October 10, 1938, which we have recited, as an individual and as agent for the defendant. We conclude that the plaintiff may not be heard to say that he dealt with Orrin Thacker as agent for the defendant in the purchase of the $10,000.00 mortgage. The terms of the written contract control and they expressly disclose that the plaintiff dealt with Orrin Thacker as the sole owner of the mortgage and probably the note. There is nothing in any of the written instruments which are exhibits in this case to indicate that Orrin Thacker was attempting to bind the defendant by his acts as agent for her and there certainly is nothing in the Article of Agreement of October 10, 1938, that suggests that he was acting in any relation whatever as the agent of the defendant. Nor, is there anything in the record which would support the conclusion that Orrin Thacker was vested with authority as agent of the defendant to transfer her title to the mortgage or the note.

The principle controlling the authority to sell real estate is found in 2 C. J. S. 1326:

“Authority to sell real estate exists only when conferred in terms unequivocally manifesting an intention to give it or when its possession is essential to the proper conduct of the agent’s employment.”

Proof of the authority of an agent to transfer a real estate mortgage should be clear and unequivocal. Orrin Thacker did not claim nor did the banks recognize his authority as agent to transfer title to the $10,000.00 note and mortgage for the purpose of collateral security. Both banks required and secured the endorsement of the defendant on the $10,000.00 note. The acts of Hinds, as president of his company, with Thacker may be reconciled upon the theory only that Thacker spoke for himself in the transaction and had no authority to bind his principal, the defendant. Miller v. Wick Bldg. Co., 154 Oh St 93.

The decisive question as we see it in this case depends upon the right of the defendant to assert against the plaintiff the defenses which she could assert against Orrin Thacker had he claimed to be the owner of the note and mortgage. The plaintiff took from Orrin Thacker whatever title it received to the mortgage and note in 1938, approximately four years after the note was due even under the extender granted by the agreement of November, 1930. It was then not a holder in due course and was not entitled to the protection of such a holder.

The status of the plaintiff must be determined in the light of the endorsements' on the note because the mortgage debt is the principal obligation between the parties and the mortgage is merely incidental thereto. It is the assignment of the debt which operates as an assignment of the mortgage.

This Court held in Parker v. Engle, 27 Abs 137, that in an assignment of the mortgage there involved,

“The rights of the assignees of a mortgage can rise no higher than those of their assignors; any defense which could be asserted against the assignor can be asserted against the assignees.”

We cited Bank of Leipsic v. Logan, 9 O. N. P. (N. S.) 40 and Osborn v. McClelland, 43 Oh St 284 and relied upon the latter case. The facts in this case are set out in the 7th syllabus:

“O., for value received, made and delivered tó P. her negotiable note, payable to the order of P. in five years, secured by mortgage. Two years before the same became due, F., without consideration, and solely for the accommodation of B. & S., bankers, loaned the same temporarily to them, to enable them to use the same as collaterals for a loan to meet a present emergency, B. & S., promising to safely keep and return them. B. & S. did not use them, but they were suffered to remain in their custody until after the note became due, when S., survivor of B. & S., without the knowledge of F., or without authority from her, hypothecated them to M. by delivery, merely saying the note would be paid. M. took the’ same in good faith and full value, but without inquiry, guaranty, or endorsement by S., relying solely on his possession and the blank endorsement of F. that S. was the owner. Held, that M. having acquired the note after due and without inquiry acquired no better title than S. had, and as S. had neither title nor interest which was good against F., he transferred none to M. that in equity gave him the right to foreclose the mortgage as against the real owner.”

8th syllabus:

“Neither is F. estopped by her acts from asserting her ownership.”

At pages 298 and 299 Judge Johnson says:

“The holder, in order to acquire a better right and title to the paper than his transferrer, must become possessed of it before it is overdue. For if it were already paid by the maker, or acceptor, and had been left outstanding, it would be already discharged, and they would’ not be bound to pay it again to anyone who acquired it after the period when payment was due. And if it were not paid at maturity, it is then considered as dishonored; and although still transferable in like manner and form as before, yet the fact of its dishonor, which is apparent upon its face, is equivalent to notice to the holder that he takes it subject to its infirmities, and can acquire no better title than his transferrer. The doctrine applicable to this subject has been admirably, stated by Chief Justice Shaw, who says: ‘Where a negotiable note is found in circulation, after it is due, it carries suspicion on the face of it. The question instantly arises, why is it in circulation? Why is it not paid? Here is something wrong. Therefqre, although it does not give the endorsee notice of any specific matter of defense, such as set-off, payment, or ’fraudulent acquisition, yet it puts him on inquiry; he takes only such title as the endorser himself has, and subject to any defense which might be made if the suit were brought by the endorser.’ 1 Daniel on Neg. Inst., Par. 782.”

8 Am. Jur., Bills and Notes, par. 431; 10 C. J. S. 726, 795. In an extended annotation to Idaho State Bank v. Hooper Sugar, Co., 68 A. L. R. 989, Ohio is listed as supporting the proposition that,

“Where, however, the original holder, has not invested the transferee for a special purpose with the legal title, it is generally held that a purchaser after maturity, even in good faith, takes subject to the defenses or equities of the original holder.” (Citing Osborn v. McClelland, supra.)
“In the hands of any holder other than a holder in due course, a negotiable instrument is subject to the same defenses as if it were nonnegotiable. * *

The principle is carried into our Negotiable Instruments Act in §8163 GC:

Sec. 8157 GC:

“To be a holder in due course, one who has taken the instrument must have done so before it was overdue.”

It is clear upon this record that had Orrin Thacker attempted to assert ownership to the $10,000.00 note and mortgage against defendant she would have had a complete defense because he was not, in fact, such owner and was attempting fraudulently to benefit by representing that he had the right to transfer them. All parties agree that Orrin Thacker acted in fraud as between him and the defendant. There are other facts which put the plaintiff upon notice that the defendant had, and was insisting upon, an interest in the note and mortgage. The deed by which plaintiff took title to the mortgage premises cast some suspicion on the title of Orrin Thacker to the mortgage. It recites that he was the holder thereof and not that he was the owner. The grantee in the deed does not assume any liability by reason of the mortgage. At about the same time that the deed was made plaintiff was put on specific notice by the terms of its agreement with the defendant that she was, at least, a part owner of the mortgage. Defendant testified and it is not denied that she, at various times, after the note was due, called upon the- plaintiff to pay interest to her. Then, too, it is of some probative effect that plaintiff long after the purchase of the mortgage from Orrin Thacker attempted to secure from the defendant a formal release of her interest in the note and mortgage by the execution of a quit-claim deed from the defendant to the plaintiff. Defendant refused to sign the deed. Some of the provisions in this deed are interesting:

“The deed is given to release any rights of the grantor herein in a certain mortgage, executed by Harvey G. Price and wife, to F. C. Smith, filed for record Dec. 14, 1928, and recorded in Mortgage Record 794, page 546, Recorder’s Office, Franklin County, Ohio; together with any rights in the •lands described in said mortgage, being the above described premises; said mortgage having been assigned by the grantor herein, then Nancy Thacker Lyons, to Orrin Thacker, who •was then the true owner of said mortgage and. the debt secured thereby; said Orrin Thacker, said assignee, being Orrin Thacker, Sr., father of Orrin Thacker, Jr. This deed given to correct and explain the allegedly defective assignment of said mortgage by Nancy Thacker Lyons to Orrin Thacker, as the same appears of record.”

There is no relevant testimony as to the market value of the lots described in the mortgage, as of 1938, when plaintiff acquired the mortgage from Thacker. Mr. Hinds says plaintiff was offered $500.00 each for these lots. It is probable that the consideration for the transfer of the mortgage was far below the value of the note which it secured. It may have approximated the value of Orrin Thacker’s share if it be as suggested in the agreement of November, 1930.

At page 403 of the opinion in Baily v. Smith, 14 Oh St, the writer of the opinion says:

“I fully concur in the doctrine laid down by Chancellor Kent, in Bay v. Coddington, 5 Johns, Chy. R. 58. He says T have not been able to discover a case in which the holder of negotiable paper, fraudulently transferred to him was deemed to have as good a title, in law or equity, as the true owner, unless he received it not only without notice but in the course of business, and for a fair and valuable consideration given or allowed on his part, on the strength of that identical paper.’ ” (Emphasis ours.)

And at page 406, discussing the interest which the assignee of a note and mortgage acquires, having stated that whether a written assignment was made or not the assignees of the note acquired all the rights and interest of the assignor in the mortgage, continued:

“In such case, the universally acknowledged doctrine, from the case of Davies v. Austin, 1 Ves. 247, to Bush v. Lathrop, 22 N. Y. R. 535, has been, that it is to be regarded as a chose in action, and, as expressed by Lord Thurlow, ‘the purchaser must abide by the case of the person from whom he buys;’.”

The rule that, when one of two innocent persons must suffer by the acts of a third, he who has enabled such third person to occasion the loss must sustain it, holds only in case of innocent holders into whose hands the note came in the regular course of business, before maturity. If the note be due at the time the agent so transferred it, the person who takes it must stand in the situation of the agent. Emerson v. Crocker, 5 N. H. 159; Ford v. Phillips, 83 Mo. 523; Julian v. Calkins, 85 Mo. 202. Our case differs, too, from some in which the foregoing rule has been applied as to parties to overdue paper but principally where the innocent endorser has endorsed the note after maturity. Here the defendant endorsed the note before due and for a limited purpose. See Eversole v. Maull, 50 Md. 55.

Upon the whole record, we are convinced that the defendant had a right to assert against the plaintiff all the defenses that she had against Orrin Thacker, the endorser of the note and mortgage to the plaintiff, and that her' defense against Thacker would have been complete. This defense is only limited against the plaintiff by reason of the fact, and to the extent, that defendant is estopped to assert title to the note and mortgage by virtue of her signature to the agreement between plaintiff, herself, and Orrin Thacker of November, 1930.

The defense of laches is not made because the rights of these parties are determined by the instruments, endorsements, assignments, and contracts which are in writing. The agency of Orrin Thacker for the defendant was not responsible for the action of the plaintiff in purchasing and attempting to secure title to the note and mortgage under consideration.

The first and fourth errors assigned are sustained and the Court erred in entering judgment quieting plaintiff’s title as against the mortgage. As we have heretofore said, by the agreement of November, 1930, to which plaintiff and defendant and Orrin Thacker were parties, the plaintiff was put on notice that the defendant was a part owner of the $10,000.00 mortgage. The defendant, likewise, by her signature to this agreement, acknowledged that Orrin Thacker, at that time, was a part owner of the mortgage. This was not the fact but defendant cannot be heard to say that it was not true as against the plaintiff because of the agreement to which she was a party. In the absence of specific information by the plaintiff of the proportion in which Orrin Thacker and defendant owned the note and mortgage, it would be presumed that they held them in equal proportions.

The order in this Court will be that the judgment of the Common Pleas Court be reversed and that a judgment be entered denying to the plaintiff and the relief sought and dismissing its petition and that the defendant be adjudged to be the owner of the $10,000.00 note, defendant’s Exhibit 5, and the mortgage securing it which is a subsisting lien on the premises described in the petition to the extent of a one-half interest in said note and mortgage.

WISEMAN and MILLER, JJ, concur.

ON APPLICATION FOR REHEARING

No. 4510.

Decided April 25, 1951.

By THE COURT.

Submitted on an application of appellee for a rehearing.

Although our rules do not now provide for applications for rehearing, we appreciate that our opinion deviated somewhat from the theories upon which the case was briefed. However, the appellant was given no relief to which she was not entitled under the pleadings and the facts as developed.

We have given careful consideration to the extended argument of counsel for appellee but find no sufficient reason to change the conclusion which we reached in our original decision. We fully presented our view as to the legal principles which we felt required the judgment of reversal.

The. application for rehearing will be denied.

HORNBECK, PJ, WISEMAN and MILLER, JJ, concur.