author: By McNAMBE, District Judge.

text:
    PROFFETT et v. VALLEY VIEW VILLAGE, Inc., et.
    United States District Court N. D. Ohio, E. D.
    No. 29974.
    Decided November 16, 1953.

      Irwin Greene, Cleveland, for plaintiff.
    Horan & Bell, Cleveland, for defendants Valley View Village and William Rosser.
    David J. Miller, Cleveland, for defendant Schimdt Bros. Sand & Supply Co.
   OPINION

By McNAMBE, District Judge.

Plaintiff will be referred to herein as Proffett, defendants, the village of Valley View and its building inspector as the village, and the Schmidt Sand & Gravel Company as Schmidt.

Proffett is the owner of 44 acres of land situated in Valley View Village, with a frontage of about one thousand feet on Tinkers Creek road. The land rises over 100 feet from a point near the roadway to a plateau upon which there is located about thirty acres of level land. These thirty acres are a part of a tableland which includes many acres of other properties extending in three directions for a considerable distance from plaintiff’s property. There are no houses located upon the tableland. The village of Valley View lies about eight miles southeasterly of the city of Cleveland. It is small in area and sparsely populated. Its population in 1930 was slightly over 500 and in 1950 was 998. It is entirely without the customary municipal facilities of water and sewers and has no sidewalks. Septic tanks are the only means of disposing of sewage, and water is obtained from wells. The Cuyahoga River and the Ohio Canal flow through the westerly portion of $10 village. Railroads are located near both its easterly and westerly boundaries. As its name implies, the village is located in a valley, but a considerable part of the property within the village consists of elevated lands lying on top of the hills that surround the valley. _ In the year 1932 the village adopted zoning ordinance No. 131. The ordinance provided for the immediate establishment of but one use district. All the property in the village was restricted to the principal and accessory uses permitted by the U-l or single residence classification. Provision was made for the granting of permits and variances by the building inspector and the zoning board of appeals, and violations of the ordinance were subject to punishment as misdemeanors. The evidence discloses that with' its mineral content the thirty acres of plaintiff’s land has a value of $1,500 per acre, while its value as undeveloped land for residential purposes is less than one-fifth of that amount.

In 1950 Proifett entered into a combination lease and contract with Schmidt by the terms of which the latter was granted the right to extract sand and gravel from Proffett’s property for a period of five years with an option for a renewal for a like period in consideration of the payment of a royalty of ten cents' per ton, with provision for a minimum payment of $2,000 annually. Later in the year Proifett was granted an oral permit for a two-year period to remove sand and gravel from the thirty-acre portion of his property. Upon expiration of the two-year period excavation was continued by Proifett until he was ordered to cease operations by the village officials. Thereafter an application for another permit was made and denied. In January, 1953 Proifett together with Schmidt again made application to the building inspector for a permit, and this application was also denied. Proifett then appealed to the zoning board of appeals, which upheld the action of the building inspector. Shortly thereafter this action was commenced.

Plaintiff seeks an order restraining the village from interfering with his removal of sand and gravel from the property. An application for a temporary restraining order was denied by this court, and plaintiff sought, unsuccessfully, in the Court of Appeals and in the United States Supreme Court to enjoin the village from interfering with his removal of the mineral deposits pending the determination of the case on the merits. However, in May, 1953 Proffett again resumed removal of sand and gravel from his property. Thereafter, on application of the village, this court issued an order restraining plaintiff from making further excavations pending final determination of this case.

The foregoing events occurred during the period thát ordinance No. 131 was- in force. On June 2, 1953 the village adopted zoning ordinance No. 53-5-1. This ordinance repealed ordinance No. 131. However, it is agreed that plaintiff’s rights are controlled and governed by ordinance No. 131. Plaintiff alleges that the ordinance is void and unconstitutional as being in violation of Section 10 of Article 1 of the United States Constitution and the Fifth and Fourteenth Amendments thereto and Article 1, Sec. 19, of the Ohio Constitution. Plaintiff assails the validity and constitutionality of the ordinance on several grounds but levels his main attack upon the alleged failure of the village to comply with the provisions of the enabling statutes of Ohio. The claims that the purpose of the ordinance is not clearly expressed in its title and that there was no publication of the ordinance after its adoption, are without merit. Nothing developed at the trial that warrants any change in the opinions expressed by the court on these two points in overruling plaintiff’s application for a preliminary injunction. Nor is there any basis for the claim that the planning commission of the village failed to certify the plan of zoning to the village council as required by law. The fact that the planning commission made findings and submitted recomendations to the council is recited in the preamble to ordinance No. 131 and no evidence has been offered to refute the verity of this recitation.

Plaintiff contends that the ordinance is void because of the failure of the council to divide the municipality into zones or districts as required by §4366-7 et seq. GC (§713.06 E. C.). Inasmuch as the village is not governed by a municipal charter, a determination of the validity of this claim requires an examination of the ordinance and the controlling statutes of Ohio. Section 2-(a) of the ordinance provides:

“Section 2-(a) Districts. For the purpose of this ordinance there is hereby created in the village of Valley View five classes of use districts and three classes of area districts. Nothing herein contained, however, shall require the immediate designation of all of the above districts upon the zone map, it being the intention to provide for said districts and to permit from time to time the creation and designation of said districts as the needs of the community may require. Said districts, however, when established by proper legislation and designation upon the zoning map shall conform to all provisions with reference to said districts hereinafter described.” (Emphasis supplied.)

Section 3 of the ordinance provides for five use classifications and three area classifications and specifies the regulations applicable in each. Although the U-2, U-3, U-4 and U-5 districts and the three Area districts are defined and the restrictions and regulations appertaining thereto are set forth in detail, the ordinance does not divide the municipality into districts or zones. Pursuant to the purpose expressed in Par. 2-(a) of the ordinance the entire village was placed in the U-l district. The establishment of the other use and area districts was deferred until such time “as the needs of the community may require.” Section 2-(b) incorporates the zoning map as a part of the ordinance. However, the original zoning map contained no delineation of districts or zones. It is merely a map of the village described by the defendant as one “which by White legend classified the entire village as a U-l district.” While thus conceding that the ordinance established but one district comprising the entire village, defendant contends that this was a compliance with the statutes governing zoning. It is urged that the ordinance was designed to preserve the residential and agricultural character of the village “while at the same time providing for future growth and development.” Defendant argues that “There was no need, demand or call for other purposes and therefore no basis upon which to establish other types of districts.” However, the state enabling act in express terms provides for the division of the municipality into zones or districts. Sec. 4366-7 GC (§713.06 E. C.), which defines the powers of a city planning commission and confers like powers upon the planning commission of a village, provides in part as follows:

“The * * * planning commission * * * shall have the power to frame and adopt a plan or plans for dividing the municipality or any portion thereof into zones or districts, representing the recommendations of the commission, in the interest of the public health, safety, convenience, comfort, prosperity or general welfare, for the limitation and regulation of the height * * * area”, etc. “and the uses of buildings and other structures and of premises in such zones or districts.” (Emphasis supplied.)

Sec. 4366-8 GC (§713.07 R. C.), which governs the location of buildings and structures, provides inter alia:

“Whenever the * * * planning commission * * * certifies to the council * * * any such plan for the districting or zoning of the municipality * * * then said council * * * may regulate and restrict the location of buildings,” etc. “* * * and for said purposes divide the municipality into districts of such number, shape and area as may be deemed best suited to carry out the purposes of this section.” (Emphasis supplied.)

Sec. 4366-9 GC (§713.08 R. C.), which applies to regulations relating to the height of buildings and structures, contains identical language with respect to the certification by the planning commission of a plan for the districting and zoning of the municipality.

See. 4366-10 GC (§713.09 R. C.) also contains provisions identical with or similar to those to be found in §§4366-8, 4366-9 GC (§§713.07, 713.08 R. C.).

The foregoing sections of the General Code of Ohio define the powers of a municipality to enact the zoning ordinance. . In clear and unambiguous terms the statutes^ require that zoning shall be accom-r plished by a division of the municipality into zones or districts Ordinance No. 131 did not accomplish this result. It imposed U-l restrictions upon the entire village and attempted to provide for the future establishment of zones and districts if and when the need therefore arose. This was not a zoning of the village. It was a plan for zoning. Zoning means a division of a municipality into zones or districts and the imposition of structural and use restrictions within the established zones or districts. 58 Am. Jur. 940, Sec. 1; 62 C. J. S., Municipal Corporations, §226 (1), page 417 et seq., and cases there 'cited. Municipalities have no inherent power to enact zoning ordinances. Such power must derive from constitutional or statutory authorization, and when the power is granted by statute, its exercise is confined by the limitations of the enabling act.

“The clearly expressed provisions of a zoning enabling statute may not be abrogated, ignored or relaxed to meet the real or supposed needs of a municipality or its inhabitants.” 1 Am. Jur. 943, note 13; 177 A. L. R. 1123.

The village advances the argument that the statutes vest discretion in the council to determine the number, shape and area of districts best suited for the municipality and that there is no statutory requirement that more than one district be established. This argument overlooks the fact that the powers conferred on the planning commission and the councils of municipalities clearly contemplate a division of the municipality into zones or districts. Here there was no such division.

Defendant cites Dowsey v. Village of Kensington, 257 N. Y. 221, 177 N. E. 427, 430, 86 A. L. R. 642, as being a case where the Court of Appeals of New York “did not find fault with the idea of one-district zoning ” A careful reading of the Dowsey case discloses that while nearly all the village was placed in a single residence district, there was a small portion reserved or zoned for business and industry. This is aparent from the following statements of the court:

“The village of Kensington is small in area, and the board of-trustees have not attempted in the zoning ordinance to segregate in appropriate places within the village all the activities of communal life. They have relegated business and industry to a very small section which the evidence shows is not adapted to business, and have excluded from the main portion of the village even residences excepting one-family detached houses.”

Nor is Duffcon Concrete Products, Inc., v. Borough of Cresskill, 1949, 1 N. J. 509, 64 A. 2d 347, 9 A. L. R. 2d 678, a case involving a single zone. The ordinance there in question divided the territory of the municipality into residential and commercial districts and prohibited the use of property in the latter for heavy industry. Exhaustive research has failed to disclose any case where the inclusion of an entire municipality in a single use district has been upheld by the courts.

The power of a municipality to enact a zoning ordinance is an exercise of the police power of the state in the interest of the public health, safety, convenience, prosperity or general welfare. The police power, however, is based upon public necessity. City of Youngstown v. Kahn Bros. Bldg. Co., 112 Oh St 654, 148 N. E. 842, 43 A. L. R. 662. And, as stated by the Supreme Court of Ohio in the leading case of Pritz v. Messer, 112 Oh St 628, at p. 639, 149 N. E. 30, at page 33:

“If the ordinance discloses no purpose to prevent some public evil or fill some public need, and has no real or substantial relation to public health, morals, and safety, it must be held void.”

Ordinance No. 131 discloses no purpose to subserve a public need or to prevent a public evil. On the contrary, the language of Section 2-(a) of the ordinance, which expresses the intention “to provide for said districts and to permit from time to time the creation of said districts as the needs of the community may require,” negates the existence of any necessity for the exercise of the police power by the adoption of the ordinance. Defendant’s argument that “there was no need nor any basis upon which districts could be established,” confirms the absence of such necessity.

The ordinance was amended in 1941 and 1947, but these amendments did not establish a zone or district within the village. In 1946 the ordinance was amended to establish a U-5 district for business and industry. The amendment provided for the designation upon the zoning map of such U-5 district. The new district was not placed upon the zoning map until 1950. There was no publication of the amendment of 1946. Of course this amendment had no retrospective application, nor was it effective to validate ordinance No. 131 as of the date of the amendment. It is held, therefore, that ordinance No. 131 discloses no purpose to prevent a public evil or to subserve a public need; that the ordinance had no substantial relation to the public health, safety, convenience, comfort, prosperity or general welfare, and that the failure of. the ordinance was to establish zones or districts within the municipality and the inclusion of the entire village in one use classification was an exercise of power not conferred upon the municipality by the zoning enabling act of Ohio, and that said ordinance is void.

The foregoing determination obviates the necessity of examining plaintiff’s additional claims that the ordinance is arbitrary and unreasonable, both in its entirety and in some of its parts and as applied to plaintiff’s property. These claims present questions which, in view of the holding here made, it is unnecessary to decide.

There remains for consideration the claim of the defendant that plaintiff is precluded from asserting the invalidity of ordinance No. 131. It is urged that by making application for and obtaining permission to excavate in 1950 and seeking a renewal of the permit in 1952 and a new permit in 1953, plaintiff “recognized and accepted” the classifications under the ordinance and cannot now contest its validity. In support of this argument defendant cites and relies upon cases decided by the courts of Connecticut and Rhode Island. The principle upon which these cases rest is stated in Chudnov v. Board of Appeals, 113 Conn. 49, 154 A. 161, 164, as follows:

“The final point urged is that if, as we have held, the use proposed by the appellant does not constitute ‘farming’ and therefore is not permitted in the residence zones, the regulations are unconstitutional. The appellant having recognized and utilized the regulations by proceeding under them, it is not open to him to attack them, in this action, as unconstitutional and invalid.”

To the same effect are Sweck v. Zoning Board of Review, 77 R. I. 8, 72 A. 2d 679; Lathrop v. Town of Norwich, 111 Conn. 616, 151 A. 183; Holley v. Sunderland, 110 Conn. 80, 147 A. 300; Piccolo v. Town of West Haven, 120 Conn. 449, 181 A. 615; Allen v. Zoning Board of Review, 75 R. I. 321, 66 A. 2d 369. It appears, however, that under the laws of Connecticut and Rhode Island the cited cases were considered and treated as appeals from and continuations of proceedings instituted before administrative boards. In commenting upon the Connecticut cases cited above, the annotator in 136 A. L. R. 1376 says:

“That the doctrine of these cásese would not be applicable to an independent proceeding brought to establish the invalidity of a zoning statute or ordinance is suggested in National Transportation Co. v. Toquet, 123 Conn. 468, 196 A. 344.”

But in no event can the cases cited above be considered as controlling here. It is settled in Ohio that one who exhausts the administrative remedies provided by a zoning ordinance is not thereby precluded from later questioning its validity. State ex Lieux v. Village of Westlake, 154 Oh St., 412, 43 OO 343, 96 N. E. 2d 414. Nor is the principle that precludes a party from questioning the validity of the very power the exercise of which he asks the court to compel, applicable. While plaintiff complains of the arbitrary and unreasonable action of the board of zoning appeals in refusing a permit, his cause of action as stated in the complaint is grounded upon the claim that the ordinance is void and unconstitutional. He seeks a permanent injunction restraining the village officials from interfering with his removal of sand and gravel from his property. There is no evidence of waiver or estoppel in plaintiff’s conduct prior to the commencement of this action. No conduct of the plaintiff has caused the village to change its position to its prejudice. In W. W. Cargill Co. v. Minnesota, 180 U. S. 452, at page 468, 21 S. Ct. 423, 45 L. Ed. 619, the Supreme Court expressed the view that the procurement of a license is not a recognition and acceptance of the invalid parts of a statute such as would require the licensee to comply therewith. Upon similar principle it must be held that the acceptance of a temporary permit under a void ordinance does not preclude the plaintiff from challenging the validity of the ordinance. The doctrine of estoppel has no application in those cases where compliance with a law is involuntary. Ordinance No. 131 contains penal provisions that prescribe punishment for a violation of its terms, and it cannot be said that plaintiff’s application for permits were not coerced by those provisions of the ordinance. A well recognized exception to the doctrine of waiver or estoppel to assert the invalidity of a law exists in these cases where the law is accompanied by penalties for failure to obey its provisions or is otherwise coercive. 11 Am. Jur. 771, Sec. 124. This exception was recognized and given effect in the recent case of Schwegmann Bros v. Louisiana Board of Alcoholic Beverage Control, 216 La. 148, 43 So. 2d 248, 14 A. L. R. 2d 680, where it was held that a liquor dealer, by applying for and accepting a license from the State Liquor Board, was not es-topped to attack the constitutionality of the statute creating the board and regulating the sale of liquor.

The ordinance does not in terms prohibit the excavation of sand and gravel from properties within the village. But such use of properties is not among those specified as permissible in a U-l district. It would seem that notwithstanding the absence of an express prohibition against removal of sand and gravel, the exclusion of such use’ from those specifically authorized would, if the ordinance were otherwise valid, be effective to prevent the plaintiff from using his property for this purpose. Town of Lexington v. Menotomy Trust Co., 304 Mass. 283, 23 N. E. 2d 559; Town of Seekonk v. John J. McHale & Sons, Inc., 325 Mass. 271, 90 N. E. 2d 325. However, the ordinance being void, there was no effective restriction upon plaintiff’s right to remove the mineral content of his property.

Reference should be made to the case of Village of Westlake v. Elrick, 83 N. E. 2d 646, 647, 52 Abs 538, decided by the Eighth District Court of Appeals of Ohio. The cited case is not analogous on its facts but of interest here is the opinion expressed by the court that compliance with the zoning enabling act requires that a “municipality must be divided into zones or districts of such number, shape and area as may be best suited to carryout the purposes of the zoning plan, in the interest of the public health, safety, convenience, comfort, prosperity or the general welfare.” (Emphasis supplied.) This is in harmony with the views hereinabove expressed. The enabling act of Ohio confers upon municipalities wide powers to restrict and regulate the use of property within municipal boundaries. Being in derogation of the common law, the act must be strictly construed. It must be confined to those matters affirmatively and definitely referred to by its terms. 50 Am. Jur. 404, Sec. 388 Even though the rule of strict construction be not applied, a determination of a legislative intent by giving effect to the clear import of the language of the statute discloses no legislative purpose to empower municipalities to restrict the use of all private property within their boundaries by converting an entire municipality into a single use district.

A decree may be entered enjoining the village and its officers from interfering with the removal of sand and gravel from the Proffett property, and dismissing the cross-petition of the village.


source: Caselaw Access Project

author: PER CURIAM:

license: Public Domain

text:
    ROBINSON, Plaintiff-Appellant, v. CLEVELAND (City) TRANSIT SYSTEM, Defendant-Appellee.
    Ohio Appeals, Eighth District, Cuyahoga County.
    No. 22677.
    Decided February 24, 1953.
    P. Jerome Pasch, Cleveland, for plaintiff-appellant.
    R. F. Mooney, R. C. Green, Cleveland, for defendant-appellee.
   OPINION

PER CURIAM:

The plaintiff’s wife was a passenger on a south-bound East 79th Street Cleveland Transit Company bus. At the time of the accident which is the subject of this action, the bus had just passed Carnegie Avenue proceeding south at about five miles per hour. At the same time, a tractor-trailer belonging to Direct Transportation Company was being driven south and was attempting to pass the transit system bus when the front end of the trailer scraped and struck the left front side of the bus, causing the bus to jump the right curb of East 79th Street (about forty feet south of Carnegie Avenue) and proceeded about seventy-one feet striking a utility pole before coming to a stop. The plaintiff’s wife was injured, as a result of such collision, by striking a grab bar in the bus.

From a judgment for the defendant entered upon a verdict of the jury, the appellant claims the following errors:

“1. In overruling plaintiff’s motion for a new trial.

“2. In refusing to give to the jury before argument the special charge requested by plaintiff.

“3. In giving to the jury before argument defendant’s special charge No. 2.

“4. In its general charge to the jury.

“5. In its refusal to admit testimony by plaintiff of the amounts of money expended by him for medical expense-, medicines and nurses.

“6. Other errors apparent upon the face of the record.”

The plaintiff originally brought this action against two defendants, the Direct Transportation Company and the City of Cleveland. The allegations of the petition charged that the said defendants were guilty of concurrent acts of negligence as a result of which the plaintiff’s wife was injured. Thereafter, the plaintiff dismissed the case as to the defendant the Direct Transportation Company, after entering into a “covenant not to sue and to cease suing,” said covenant being entered into for the consideration of $1.00.

The general charge of the court when considered in its entirety adequately presented to the jury the law applicable to the case. Therefore, the plaintiff’s rights were not prejudiced thereby.

The plaintiff’s complaint of error in failing to give his special request to charge before argument was properly refused by the court because the text of such charge was inaccurate. It, in effect, was that if either defendant was negligent, then the plaintiff could recover against the transit system.

We further hold that the defendants’ special request to charge before argument No. 2 was properly given. It provided that if the plaintiff’s wife was injured as a proximate result of and solely because of the negligence of the Direct Transportation Company, then they should find for the defendant, the City of Cleveland. Under the facts of the case, this was a correct statement of the law and, therefore, the giving of such charge did not constitute prejudicial error.

The further claim of error on the part of plaintiff that the refusal to permit the introduction in evidence with respect to plaintiff’s doctor bills and medical expenses occasioned by his wife’s injury, without expert testimony, was not prejudicial primarily because the jury’s verdict was for defendant. The jury was therefore not called upon to give consideration to such evidence.

The judgment is affirmed. Exceptions noted. Order see journal.

HURD, PJ, KOVACHY, J, SKEEL, J, concur.


author: By McDOWELL, J.

text:
    RICE et, Plaintiffs, v. WHEELING DOLLAR SAVINGS & TRUST COMPANY, EXR, etc., et, Defendants.
    Common Pleas Court, Cuyahoga County.
    No. 602033.
    Filed June 30, 1954.

      McAfee, Grossman, Tappin, Hanning, Newcomer & Hazlett, Cleveland, and Hoppe, Day & Ford, Warren, for plaintiffs.
    Arter, Hadden, Wykoff & Van Duzer, Walker H. Nye, Cleveland, and Paul & Phillips, for defendants.
    (McDOWELL, J, of Highland County, sitting by designation in Cuyahoga County.)
   OPINION

By McDOWELL, J.

This is a stockholders derivative action brought by the two plaintiffs as holders of one share each of the common capital stock of The Jefferson Company, an Ohio corporation, against Wheeling Dollar Savings & Trust Company, as -Executor under the will of D. A. Burt, Sr., and D. A. Burt, Jr., W. L. Burt and Martha B. Kunkel, the three children of D. A. Burt, Sr., deceased. The plaintiffs and the aforesaid defendants are all residents of West Virginia. No personal service was had upon these defendants, the Court’s jurisdiction having been invoked by the attachment of certain Ohio funds or choses in action owing to the three Burt children and being therefore limited to those funds. The Jefferson Company, in whose behalf and right the action is brought, is also a party defendant, demand having been made upon it by plaintiffs to bring the action, which demand was refused. The action was defended by the three Burt children under answers disclaiming the entry of general appearance and denying jurisdiction over their respective persons.

The petition prays for judgment on behalf of The Jefferson Company against the other defendants in the sum of $721,631.32 and for general equitable relief. It contains three causes of action, which may be summarized as follows:

The first cause of action alleges that The Jefferson Company was organized in Ohio in 1930 in pursuance of an agreement and plan between and a joint venture of D. A. Burt, Sr., and plaintiff, R. M. Rice, to take over from Burt and Rice certain coal lands in Jefferson County,] Ohio, known as the “Beluan Property,” and to acquire certain other ad-] jacent or nearby tracts of coal mining properties comprising about] 5000 acres. D. A. Burt, Sr. and his sons, the defendants D. A. Burt, Jr.| and W. L. Burt, were elected directors and President, Secretary and Vice] President respectively and continued to serve as such until 1945 when] they sold all their stock to North American Coal Corporation. It is further alleged that upon its organization The Jefferson Company acquired the Beluan property; that in January of 1938 it acquired the right to remove coal from the property known as the “Superior Tract”; that in 1941 D. A. Burt, Sr., purchased the fee of the Superior Tract for $50,000.00 and caused it to be conveyed to his two sons; that in July of 1938 D. A. Burt, Sr. purchased the fee of a property known as the “Climax Tract” for $65,000.00 and caused it to be conveyed to a family partnership, which in 1941 conveyed it to the three Burt Children, who in 1943 cancelled the old lease of the Superior Tract and leased it and the Climax Tract to The Jefferson Company at certain royalty rates and continued to collect royalties from The Jefferson Company until 1948, when they sold all of such coal properties to North American Coal Corporation, and that the funds used for the purchase of these tracts were in part, if not wholly, funds of The Jefferson Company advanced in violation of law. All of this is alleged to be in violation of the joint venture, plan and agreement aforesaid and in violation of the fiduciary duties and obligations of D. A. Burt, Sr., D. A. Burt, Jr. and W. L. Burt as directors and officers of The Jefferson Company. It is alleged that defendant, Martha B. Kunkel, was at all times fully aware of the said joint venture, plan and agreement and that she acted in concert with her father and brothers for her and their benefit, to the detriment of The Jefferson Company and that all of these transactions were fraudulently carried out in violation of their respective fiduciary obligations to the company as shareholders, officers and directors thereof. Similar allegations are made respecting certain smaller tracts of coal properties.

The second cause of action states that in 1944, D. A. Burt, Sr. and his three children, when shareholders, directors and/or officers of The Jefferson Company, caused $10,982.00 of the funds of The Jefferson Company to be paid to the Oglebay Institute of Wheeling West Virginia, a charitable organization, as a contribution from D. A. Burt, Sr. in memory of his mother.

The third cause of action alleges that from 1937 to 1945 the defendants advanced to themselves and to members of their families for their personal use funds of The Jefferson Company; that while all of such advances were repaid, no interest was paid thereon, and the defendants are still indebted to' the Company for interest of approximately $10,649.32.

Answers and amended answers of D. A. Burt, Jr., W. L. Burt and Martha B. Kunkel admitted certain factual allegations of the petition, denied generally the other statements thereof and asserted certain defenses of an equitable nature, among them that since 1945 when they sold all of their shareholdings in The Jefferson Company to North American- Coal Corporation, none of the three defendants had been an officer, director or shareholder of The Jefferson Company and none had had anything to do with its operations; that with full knowledge of the true facts The Jefferson Company and its directors refused the demand of the plaintiffs to bring the action in the name of and on behalf of The Jefferson Company as plaintiff; that if any cause of action exists it belongs exclusively to The Jefferson Company and that the plaintiffs Pave no right or power to bring the action for or on behalf of said jompany.

When The Jefferson Company was organized in 1930 its common shares were issued as follows; 33 shares to plaintiff R. M. Rice, 28 shares to D. A. Burt, Sr., 5 shares to D. A. Burt, Jr. and 34 shares to The W. T. Burt Company, a corporation owned or controlled by the Burt family. Its entire authorized preferred stock consisting of 1,000 shares was issued to The W. T. Burt Company, which had put in the money for the purchase of the Beluan tract. Immediately prior to February 20, 1945. as the result of transfers and the issuance of certain additional stock, the two plaintiffs owned 39 shares of the common stock, L. Alice Rice, a sister of the plaintiffs, owned 6 shares, and the members of the Burt family owned or controlled the remaining 1443 shares. On February 20, 1945, all of the Burts sold their 1443 shares of stock to the North American Coal Corporation for $672.05 a share. North American for a number-of years had been interested in the operations of The Jefferson Company and had assisted materially in its financing. D. A. Burt, Sr. and his two sons, who had been officers and directors of The Jefferson Company through the years, thereupon ceased to be officers, directors and stockholders, Martha B. Kunkel ceased to be a stockholder, and a new Board consisting of officers or employees of North American Coal Corporation was elected. Since that time no member of the Burt family has been a stockholder, officer or director or has had any connection with the management of The Jefferson Company.

In March of 1948 R. M. Rice owned 38 shares of The Jefferson Company, Ruth C. Rice owned 7 shares, L. Alice Rice owned 7 shares, and North American Coal Corporation owned all of the other shares. At that time the two plaintiffs and their sister, L. Alice Rice, sold to North American all of their shares except the two retained by the plaintiffs for the purposes of this lawsuit, and received therefor $1,080.00 per share. R. M. Rice’s sale was made under an agreement with North American to the effect that in consideration of the sale of 37 of his 38 snares, the plaintiffs reserved their rights as shareholders to proceed against the Burts and that they would receive 50% of all assets which they might recover for The Jefferson Company, the plaintiffs to bear all expenses, including attorney fees. They also agreed to take cash for their remaining two shares, when, as and if The Jefferson Company should be liquidated.

On March 2, 1949, the plaintiffs made written demand on The Jefferson Company to bring suit against the estate of D. A. Burt, Sr. and his children for an accounting, damages and equitable relief. The demand letter stated the belief that some of The Jefferson Company funds were initially used for the purchase by the Burts of the Climax and Superior tracts, and that they were acquired in violation of the Burts’ fiduciary relationship to the Company. At a meeting held on March 4, 1949 the Board of Directors of The Jefferson Company, which then consisted entirely of officers and employees of North American Coal Corporation, after obtaining the advice and opinion of the Company’s counsel, adopted a resolution refusing the plaintiffs’ demand. At that time, and when this action was filed by the plaintiffs in April of 1949, North American was the owner of 1711 and 1713 outstanding shares of The Jefferson Company and each of the plaintiffs was the owner of one share. The Jefferson Company is now in process of liquidation by its principal owner, North American.

At the beginning of the trial, immediately following the opening statements, counsel for defendants moved to dismiss the petition on the ground that under the facts above stated the plaintiffs have no right or capacity to maintain this stockholders’ derivative suit. The motion-was argued by counsel but decision was reserved until completion of all the testimony and final submission of the case.

The legal issue thus raised is a most interesting one. It, as well as all other issues, has been exhaustively briefed by both sides and has been the súbject of much study and consideration by the Court. The question is whether a minority shareholders’ derivative suit, seeking recovery on behalf of the corporation, can be maintained in equity where the defendants are former directors or shareholders and where the demand that the corporation bring the action was considered and refused by a board of directors representing the holder of'nearly all of the outstanding stock, none of whom participated or was in any way involved in the conduct of the defendants complained of in the petition.

It is elementary that normally a corporate cause of action belongs solely to the corporation and can be enforced by it alone. Sec. 1701.63 R. C. expressly vests all of the capacity and authority of an Ohio corporation in its Board of Directors. See also 13 Fletcher on Corporations, Sec. 5944; 6 Thompson on Corporations, 3rd Ed. Sec. 4490. Cases inevitably arose, however, where those in control of the corporation were themselves guilty of breach of fiduciary duty, fraud, waste of corporate assets and similar unlawful acts. Being so involved, they would not cause the corporation to bring suit against themselves, and this created situations where at law minority shareholders were without remedy. Such an injustice called strongly for the intervention of courts of equity, and so it came about that equity devised the remedy of the stockholders’ derivative suit, as an exception to the general rule. Such an action is of equitable cognizance only. Scullin v. Drug Co., 138 Oh St 133; 13 Fletcher on Corporations, Sec. 5944. Doubtless on the principle of requiring the exhaustion of all legal remedies, even where the circumstances are such that a derivative action may be brought, it is a condition of the exercise of the derivative right by a stockholder that a demand be made that the corporation bring the action and that it be refused, unless it is plain that a demand would be a futility. Ellis v. Savings Co., 104 Oh St 599; Zinn v. Baxter, 65 Oh St 341.

In 1887 the Supreme Court of the United States decided the widely cited ease of Hawes v. Oakland, 104 U. S. 450. A shareholder of a privately owned waterworks corporation brought a bill in equity against the corporation, its directors and the City of Oakland, alleging that the Company was furnishing the city with water for all municipal purposes, without compensation, and that the city was entitled to free water only in cases of fire or other great necessity; that plaintiff had demanded of the Board of Directors that the Company desist from its illegal practice but that the Board refused to do so. A demurrer by the city was sustained and the bill dismissed by the lower court. The Supreme Court affirmed.

The opinion of the Supreme Court reviewed at length a number of earlier decisions by the English Courts of Chancery, and the case of Dodge v. Woolsey, 18 Howard 331, 59 U. W. 331, decided in 1855. The Dodge case had permitted the maintenance of a derivative action by a minority shareholder under the facts there involved on the ground that the conduct of the directors “partake more of disregard of duty, than of an error of judgment. It was a nonperformance of a confessed official obligation, amounting to what the law considers a breach of trust, though it may not involve intentional moral delinquency.”

The opinion in Hawes v. Oakland, supra, written by Mr. Justice Miller, stated that it was felt there should be a consideration of the grounds on which Dodge v. Woolsey was decided and a just limitation of the exercise of those principles. After its review of Dodge v Woolsey and the other pertinent cases the opinion enunciates the following rules:

“We understand that doctrine to be that to enable a stockholder in a corporation to sustain in a court of equity in his own name, a suit founded on a right of action existing in the corporation itself, and in which the corporation itself is the appropriate plaintiff, there must exist as the foundation of the suit—

“Some action or threatened action of the managing board of directors or trustees of the corporation which is beyond the authority conferred on them by their charter or other source of organization;

“Or such a fraudulent transaction completed or contemplated by the acting managers, in connection with some other party, or among themselves, or with other shareholders as will result in serious injury to the corporation, or to the interests of the other shareholders;

“Or where the board of directors, or a majority of them, are acting for their own interest, in a manner destructive of the corporation itself, or of the rights of the other shareholders;

“Or where the majority of shareholders themselves are oppressively and illegally pursuing a course in the name of the corporation, which is in violation of the rights of the other shareholders, and which can only be restrained by the aid of a court of equity.”

Corbus v. Mining Co., 187 U. S. 544, arose on a bill in equity by a minority shareholder to restrain his corporation from paying an Alaskan license tax claimed to be illegal. In affirming the dismissal of the bill the court referred to Hawes v. Oakland and Dodge v. Woolsey, supra, and said:

“The directors represent all the stockholders and are presumed to act honestly and according to their best judgment for the interests of all. Their judgment as to any matter lawfully confided to their discretion may not lightly be challenged by any stockholder or at his instance submitted for review to a court of equity. The directors may sometimes properly waive a legal right vested in the corporation in the belief that its best interests will be promoted by not insisting on such right. They may regard the expense of enforcing the right or the furtherance of the general business of the corporation in determining, whether to waive or insist upon the right. And a court of equity may not be called upon at the appeal of any single stockholder to compel the directors or the corporation to enforce every right which it may possess, irrespective or other considerations. It is not a trifling thing for a stockholder to attempt to coerce the directors of a corporation to an act which their judgment does not approve, or to substitute his judgment for theirs. As said in Dodge v. Woolsey, 18 How. 344: “The circumstances of each case must determine the jurisdiction of a court of equity to give the relief sought.”

In Kessler v. Ensley Co., 123 Fed. 546 (1903) minority shareholders filed a bill in equity against the corporation and former officers and directors to recover on behalf of the corporation for frauds of the directors in the transfer of real estate of the corporation. It was held that, assuming that the original transaction was fraudulent by the directors then in office, and that a court of equity would have set it aside at the suit of the corporation, the subsequent action of other directors and the stockholders in refusing to bring suit for that purpose was an election not to disturb the transaction which was binding upon the corporation and the minority stockholders, no fraud or undue influence inducing such action being charged. In the opinion it is said:

“The power must reside somewhere in every corporation when it has been defrauded, whether by its own officers or third persons, to determine what course it will pursue with reference to the fraud. The fact that the corporation has been defrauded does not strip it of power to elect to stand upon the transaction as made. Every wronged person, who is sui juris, has that right against the wrongdoer. If the corporate tribunal exercises its judgment upon the question honestly, and is not adversely interested, or under the control of other influence which sway it from a fair and impartial judgment from the standpoint of the interest of the corporation itself, a decision not to disturb the fraud, unless it evinces such recklessness and negligence as amounts to bad faith, is not a fraud upon the objecting stockholders, though it results in a refusal to redress a fraud upon the corporation. The duty which the corporation, or its governing body, owes its stockholders in such cases, is to fairly and impartially consider the question of redressing the wrong, and not to commit a corporate fraud upon its stockholders by refusing to set aside the fraud upon the corporation from selfish interest or other bad motives, or from such negligence and indifference as is equivalent to bad faith, and amounts to a clear breach of trust, as distinguished from mere bad judgment.”

S. Colomont & Sons Trust, Inc. v. New England Theatre Operating Corp. (Mass. 1950), 93 N. E. 2d 241, was a case where minority shareholders made claim on behalf of the corporation against other shareholders who were its principal executives, and where a disinterested majority of the shareholders had voted that it was not in the best interests of the corporation to bring suit. In holding that the minority shareholders had no right to insist that suit be brought the court said:

“If the majority of the board of directors of a corporation are incorruptible, free from collusion with wrongdoers, and ready to act for the best interests of the corporation, there is no reason why an individual stockholder should be permitted to involve it in lawsuits. (221 Mass, at page 538, 109 N. E. at page 456.)

“* * * On principle, we perceive no reason why the usual rule recognizing that it is for the corporation to decide questions of business policy should be subject to an exception limiting the corporate power where a charge is made against an officer or director but where an independent, disinterested majority of the stockholders acting reasonably and in the best faith have voted that in their judgment it is not in the best interest of the corporation to sue. We do not believe that in such a case the power of effective decision shifts from a majority to a minority of the stockholders. We know of no principle requiring that a corporation once wronged cannot exercise an honest judgment to refrain from doing that which may wrong it even more.”

Another Massachusetts case, Dunphy v. Newspaper Association, 146 Mass. 495, 16 N. E. 426, states the principle very aptly:

“It would be contrary to the fundamental principles of corporate organization to hold that a single shareholder can at any time launch the corporation into litigation to obtain from another what he deems to be due to it, or to prevent methods of management which he thinks unwise. Intelligent and honest men differ upon questions of business policy. It is not always best to insist upon all one’s rights; and a corporation acting by its directors, or by vote of its members, may properly refuse to bring a suit which one of its stockholders believes should be prosecuted. In such a case the will of the majority must control. It is only when the action of a corporation in refusing to proceed at the request of a stockholder is fraudulent as against him, or in disregard of his rights, that he can maintain a suit in his own name in the corporate right. The court cannot interfere with the management of corporations in matters which are properly within their discretion, so long as their discretion is fairly exercised, and it is always assumed until the contrary appears, that they and their officers obey the law, and act in good faith towards all their members.”

In Ohio the case of Cooper v. Central Alloy Steel Corp., 43 Oh Ap 455, is in accord with the governing principles of the foregoing cases. After refusal of his demand on Central Alloy to bring suit a minority shareholder brought an action for an accounting for the benefit of Central Alloy against certain of its officers and directors for fraudulent breach of trust in making a contract with another company of which they were also directors, resulting in loss to Central Alloy, and in causing an unfair merger agreement between three companies to be approved, under which the predecessor of Central Alloy and its shareholders received a fraudulantly low value for their interest. It does not appear clearly whether the two defendants accused of fraudulent acts were directors at the time the demand on Central Alloy to bring suit was refused. On a review of all the evidence the court found on the merits that there was no actionable fraud, but also concluded that plaintiff had no right to sue, because the refusal of the corporation to bring the action was made in good faith and after proper consideration. It is said at page 470 of the opinion:

“The basis of the plaintiffs right to bring this suit rests upon the fact that Central Alloy wrongfully refused to bring this action, that its investigation thereof was perfunctory and arbitrary, its refusal expedient and wrongful, and that such action constituted a breach of trust. This we find to be untrue and wholly unsupported by the evidence, and the contrary is proved, in that the board of directors caused an investigation to be made covering an adequate period of time and at considerable expense to arrive at the truth of the plaintiff’s claim. The failure of the plaintiff to prove, and the lack of concealment, ■ fairness, and proof made of the facts to the contrary by the defendants, must of themselves defeat the plaintiff’s claim.”

In 10 O. Jur. 361 is the statement:

“A stockholder * * * must show a clear breach of duty on the part of the directors in neglecting or refusing to act in the matter, amounting to such grossly culpable conduct as would lead to irremediable loss if he were not permitted to bring the matter before the courts. * * t The law permits him to bring an action to enforce a right in behalf of the corporation, only where the corporation itself refuses or fails to do so where it is controlled by those who are perpetrating the wrong, or who will benefit thereby, — or where the facts alleged and proved show that the suit would not be prosecuted by the corporation in good faith or for the benefit of the corporation and its shareholders.”

Other authorities, including 13 Fletcher Cyclopedia of Corporations, Sec. 5821, might be quoted, but in the opinion of this Court the foregoing are sufficient to force the conclusion that the plaintiffs have no right or capacity to bring this action and that the motion to dismiss their petition must be sustained.

Except for two shares owned by the plaintiffs the North American Goal Corporation was the owner of The Jefferson Company at the time the demand to bring suit was made. As holder of 1711 out of 1713 common shares, or of 99.88% of all of the outstanding common stock, its representatives constitute the entire membership of the board of The Jefferson Company. Acting under the advice of counsel those directors deliberately decided that the corporation should not bring this action and refused the plaintiffs’ demand that it do so. No member of this board was directly or indirectly a party to or in any way involved in any of the wrongs alleged by the plaintiffs. There is no showing that their decision was anything but the exercise of a considered and unbiased judgment. Indeed, since any recovery from the defendants would accrue almost entirely to the benefit of North American, whose employees these directors were, their own interests would seem to be more likely' to influence them to bring the action than refuse to- do so. Under these circumstances a court of equity should not and will not substitute its judgment for theirs and pass on the wisdom of decision.

The Court has not been referred to and has not found any case where a shareholder’s derivative suit has been sustained against former officers and directors and where, as here, the board which refused to have the corporation bring the suit was not acting ultra vires or with no involvement in the acts complained of. Plaintiffs rely both on Dodge v. Woolsey, supra, and Ashwander v. Tennessee Valley Authority, 297 U S. 288. For reasons which have been stated the Court is of the opinion that the Dodge case gives no support to their position, and considers the Ashwander case to be in the same category.

The Ashwander case. was a suit by minority shareholders to invalidate a contract between their corporations and the Tennessee Valley Authority. They contended that the contract was invalid because it called for the performance by an agency of the Federal Government. The board of directors of the corporation had refused to bring suit and the Supreme Court held that the plaintiffs could therefore maintain it but only because of the claimed illegality of the transaction, the unconstitutionality of the contract. This plainly appears from the following language of the opinion:

“Plaintiffs did not simply challenge the contract of January 4, 1934, as improvidently made — as an unwise exercise of the discretion vested in the Board of Directors. They, challenged the contract both as injurious to the interests of the corporation and as an illegal transaction, —violating the fundamental law.”

Another point of distinction is that the Board of Directors which refused to bring suit in the Ashwander case was evidently the same board which had originally authorized the making of the illegal contract and hence the demand was not passed upon by an entirely disinterested board.

It is contended in plaintiffs’ brief that in refusing to bring suit the present directors of The Jefferson Company were guilty of a breach of their fiduciary duty “to protect, guard, preserve, maintain and recover corporate assets.” The authorities heretofore reviewed show that if they ■are in an unbiased position and act honestly, the wisdom of their decision will not be reviewed by the courts. There is not the slightest evidence in the case to warrant the inference or thought that the decision not to bring suit was not made in the honest belief that such a suit would not be in the interests of the Company.

The sustaining of the motion to dismiss for lack of capacity of the plaintiffs to sue disposes of the case in its entirety. Nevertheless, in its consideration of the case, the Court has studied the evidence as contained in a lengthy stipulation of facts, a great number of exhibits, the oral testimony embracing 558 pages and the voluminous and helpful briefs filed by counsel for both sides. The Court is unable to say from the evidence that any actionable fraud or breach of fiduciary duty has been shown and the Court finds that plaintiff has failed to establish the allegations of the first and third causes of action of the petition.

With respect to the second cause of action, the contribution of $10,982 to Oglebay Institute, a charitable corporation, was made in 1944 at the instance of D. A. Burt, Sr. and his sons in memory of the mother of D. A. Burt, Sr. It was essentially the contribution of the Burt family and represented a use of corporate funds not sanctioned by law and without going through the procedure of notifying all shareholders as prescribed in §1702.26 R. C.

It is therefore the judgment of the Court that the petition of the plaintiffs be dismissed at their costs and that the attachments issued against defendants D. A. Burt, Jr., W. L. Burt and Martha B. Kunkel be discharged. A journal entry may be drawn accordingly.


author: By THE COURT.

text:
    STATE ex LONG, Relator-Appellee, v. INDUSTRIAL COMMISSION, Respondent-Appellant.
    Ohio Appeals, Second District, Franklin County.
    No. 4995.
    Decided February 16, 1954.
    Kenneth Agee, Columbus, R. Brooke Alloway, Columbus, for relatorappellee.
    Hon. C. William O’Neill, Attorney General, James M. Videan, Assistant Attorney General, Columbus, for respondent-appellant.
   OPINION

By THE COURT.

This is a law.appeal from the judgment of the Common Pleas Court ordering a writ of mandamus to be issued requiring the Industrial Commission of Ohio, the respondent herein, to make an additional award for the violation of a specific safety requirement which is set forth in Bulletin 203, Section 15 (d) of the regulations of the Industrial Commission and known as “General Safety Standards for Workshops and Factories.”

The record discloses that on April 4, 1949, the relator sustained a compensable injury; that claims for compensation and medical expenses were duly filed, allowed and paid as provided by law; that on May 16, 1950, an application for an additional award was filed for the alleged violation of a specific safety requirement, the same section as that now under consideration. Upon a hearing being had the Commission issued the following order:

“This claim coming on to be heard on claimant’s application for additional award for Violation of Specific Requirement filed May 16, 1950, the Commission finds from proof of record that claimant’s injury was not caused by employer’s violation of any specific requirement and that claimant’s said application should, therefore, be denied.”

An application for a rehearing was filed and the previous order was affirmed.

The operating facts as they appear in the file of the respondent show that on April 4, 1949, relator was regularly employed by the Butler Co-Operative Company, which operated a combination elevator, mill and feed store. On the day in question he and a fellow employee had run a quantity of corn cobs through the hammer mill and then through the feed mixer. At the time of the accident the relator was engaged in cleaning the residue from the bottom of the vertical screw or worm, located in the bottom of the mixer, when the starting switch on the same was inadvertently pressed by the other employee. This started the mixer, including the vertical screw while the relator had his left hand inside of the metal casing within which the screw was housed. He had previously lifted a small sliding metal door on this casing and inserted his hand while the machine was stopped. When the mixer was inadvertently started his left hand was caught between the screw and the casing resulting in his injuries. This mixer, a drawing and description of which by the special investigator are in the file, is a rather large machine located on the first floor of the mill, with all moving parts completely encased in said metal. It stands about 10 feet high and is located entirely in one room of the mill, with the exception of the section of the vertical worm or screw which extends 24 inches below the floor and into the basement. The vertical worm or screw is totally enclosed by a metal casing until it moves into the hopper at the top of the mixer. There is a 4 by 4 inch hand hole located in the part of the casing below the floo.r level which is covered by a tight fitting, sliding metal door. There is a metal rod handle welded to it which extends vertically up through the floor with a hook on the upper end so that the operator could open and close it from his regular station on the first floor without going to the basement. It was through this opening that the relator had his hand when the accident occurred.

The record discloses that there was an electrical switch in the room on the first floor by means of which the machine could be disengaged, but there was none in the basement, where relator was when the injury occurred; hence, the legal question arises as to whether or not the failure to have one in the basement was a violation of the aforesaid section of said Bulletin 203. This section provides that,

“Every room or department shall be provided with a means of disengaging the machinery in that room or department from the source of power.”

It should be noted that the question presented is one of law; hence the order of the Commission is not final. Slatmeyer v. Commission, 115 Oh St 654. We think it is clear from the facts presented that a part of the machine causing the injury was located in the basement and if the provisions requiring a cutoff switch in each room are controlling, then there has been a failure of compliance with the reqirement.- But the respondent urges that even if this theory is correct still there was one switch for the department which is in full compliance with the regulation. Again, we cannot agree with the respondent. Perhaps there would be some merit to this contention if the section of Bulletin 203 provided “Every room and department shall be provided with a means of disengaging the machinery in that room and department from the source of power.” A department might well be located in several rooms and were the respondent’s theory adopted only one disengaging switch would be required. Such a construction, it appears, would defeat the entire purpose of the safety requirement in case the employer chose to regard each machine as a separate department. We are of the opinion the regulation requires a means of disengaging the machinery from the source of power in each room, or when there is more than one department in a room, then each department in said room must be capable of being disengaged.

Counsel also urges that Bulletin 203 has no application whatever to the instant case for the reason that the machinery in question herein was excluded from the operation of Bulletin 203 by the “scope” clause of Bulletin 110 of the Industrial Commission of Ohio, entitled “Specific Safety Requirements covering the construction, maintenance and operation of elevators, dumb waiters, escalators, man-lifts and their hoist-ways. In support of this argument counsel cite the case of Marble Cliff Quarries Co. v. Commission, 154 Oh St 459. Said Bulletin No. 110 provides:

“The requirements of this code shall apply to the construction, inspection, maintenance and operation of elevators, dumb-waiters, escalators, man-lifts and their hoistways, except as stated in the following paragraph * *

We think that the type of elevators, etc., set forth in the “Scope” above quoted have no similarity to the machinery which was the cause of the injury to the relator and the rule of ejusdem generis excludes from its purview any machinery not of the same general character as that specifically enumerated. It is true the worm screw elevated the feed from the basement to the hopper on the second floor, but the chief function of the machinery was that of a grinder, not of an elevator. An examination of the facts reported in the decision in the case of State, ex rel. Marble Cliff Quarries Co. v. Commission, supra, discloses that the conveyor involved therein was in fact a “bucket conveyor system” and was for the purpose of conveying the material from one point to another higher point, and therefore was not similar to the mixing machine involved in this action.

We find no error in the record and the judgment will be affirmed.

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


author: By VAN BUREN, J.

text:
    O’NEILL, Plaintff, v. ARMENTROUT et, Defendants.
    Common Pleas Court, Fulton County.
    No. 13218.
    Decided December 16, 1954.
    Charles M. Ham, of Ham & Ham, Wauseon, for plaintiff.
    Norman E. Bischoff, of Cline, Bischoff & Cook, Toledo, for defendants.
   OPINION

By VAN BUREN, J.

This is a case in equity, in which specific performance is asked of a contract to sell real estate.

In her second amended answer, defendant admits she is the owner of the real property described in the petition. She denies, however, entering into any agreement with plaintiff to convey the premises in question, and further denies that such an agreement, if there was one, was in writing, as required by the Statute of Frauds, §1335.04 R. C.

From the pleadings in this case, and the evidence adduced at the trial on November 5, 1954, it appears that the house on the approximately one acre of land in question, located on Route 20, north of Delta, in Fulton County, Ohio, was severely damaged by fire on April 14, 1952. Six days later, on April 20, 1952, Mr. Armentrout, husband of the defendant, died. The estate of Mr. Armentrout has since been probated, and defendant has become, and now is, the sole owner in fee simple of the land and partially destroyed house involved in this action for specific performance.

The testimony of plaintiff, Gary O’Neill, is quite clear as to what happened when he talked to Mrs. Armentrout, the defendant, about buying the property, on October 7, 1952. Plaintiff testified he saw a “For Sale” sign in front of the place, bearing the name of Beulah Armentrout, and the address “Trilby, Ohio.” Plaintiff went to Trilby to see Mrs. Armentrout, but she was not there. He was told that she had gone to the premises on Route 20, and there he found her displaying the house to another prospective purchaser. She told plaintiff she had just shown another man through the place. She said she was taking bids on it, and that she wanted $3000.00 for the property.

O’Neill said, “I tried to offer her some money at the time.” When defendant quoted the price of $3000.00, O’Neill testified he told her, “I’ll take it.” Defendant said her lawyer, Mr. Norman E. Bischoff, whose residence was in Sylvania, had to agree to the price; that he represented her in the probate proceedings; and that the Probate Court had to approve it.

Then Mr. O’Neill, with his father, contacted Attorney Bischoff on Sunday next, and a down payment of $100.00 was tendered by O’Neill and accepted by Mr. Bischoff. A receipt was prepared by Mr. Bischoff, signed by him, and given to the plaintiff. This paper writing was introduced in evidence as Plaintiff’s Exhibit One, and reads as follows:

No. - Oct. 12 1952
RECEIVED OF Gary O’Neill One hundred and no/100 DOLLARS
100
Dep. on Armentrout house for $3000.00 subject to approval of Probate Court $100.00 N. E. Bischoff.

According to plaintiff, Attorney Bischoff said there would be a delay of one week or ten days before the approval of this sale by the Probate Court could be secured.

Then, according to plaintiff, he called the defendant, Mrs. Armentrout, who said she would bring the keys over the next day, and show him through the house. Mrs. Armentrout, shortly thereafter, attempted to rescind this contract of sale by letter dated October 14, 1952, postmarked October 15, 1952, at Toledo, Ohio, and which letter and envelope were introduced in evidence and marked for identification as Plaintiff’s Exhibits Two and Three respectively, and which read as follows:

(Exhibit Two)
Toledo, Ohio
October 14, 1952
Dear Gary O’Neill:
I have to tell you that Margaret O’Neill bought the brick house last Sat. She dealt through her attorney & he let Mr. Bischoff know on Monday.
I called my attorney Tues. & he told me.
Sincerely
Mrs. Beulah Armentrout
(Exhibit Three) ,
6354 Secor Road ( Stamp Cancellation )
Toledo 13, Ohio ( and postmark: )
TOLEDO •
OCT 15
5:30 P.M.
1952
OHIO
Mr. Gary O’Neill,
Delta,
Ohio, Route 1.

Plaintiff and his father testified that they then called upon Mrs. Armentrout and tendered her $2900.00 in cash, which she refused to accept.

The one hundred dollar deposit on the contract was kept by defendant and her attorney until October 27, 1952, when a check was mailed by Attorney Bisehoff to plaintiff. The check was never cashed, however. It was returned to defendant, and appears in this case as Defendant’s Exhibit “A”.

The father of plaintiff, Martin O’Neill, verifies this testimony -at plaintiff.

He does add to the testimony of his son, however, in a recollection, that when Mrs. Armentrout showed them the place in question, she said that another O’Neill — a Mrs. William O’Neill — had been trying to buy the property for $2500.00, but that the price was $3000.00. She said she would sell for that figure, according to the testimony of Martin O’Neill, and that they were to contact her attorney, Mr. Bisehoff. Defendant told them Mr. Bisehoff had the power to sell this real estate.

In her testimony, defendant admits that on October 7, 1952, she was in the yard of the property for sale, when plaintiff and his father stopped there; that there was a “For Sale” sign on the property, and that she had put it there; that Attorney Bisehoff was taking care of her affairs at that time.

The testimony of Attorney Bisehoff is substantially the same, although he does state that there was a limitation of some kind when he closed the deal as to time, other than the necessity to secure approval of the Probate Court. However, the paper writing does not reflect any such other limitation.

It is the opinion of the court that a contract was entered into by and between the parties to this action; that there was a definite meeting of the minds which was reduced to writing when the receipt was executed by Attorney Bisehoff, who was acting for and in behalf of the defendant, both as attorney and as her agent. The paper writing (Exhibit One) clearly specifies the price involved and the property in question.

The limitation in this receipt as to the necessary approval of the Probate Court does not seem important at this time.

The defendant now has title to the property, and can convey the same to plaintiff in her own right. The Certificate for Transfer of Real Estate to her by the Probate Court of Fulton County, Ohio, dated October 30, 1952, and recorded November 28, 1852, appears in Fulton County Transfer Records, volume 4, at page 154.

The facts in this case are quite similar to those in Ward v. Bickerstaff, 79 Oh Ap, 362. In that case, the receipt, almost identical with the one submitted in this case as Plaintiff’s Exhibit One, was held to be “some memorandum or note” in writing, signed by the parties charged therewith, and under the Statute of Frauds, an action thereon can be brought for specific performance of a contract to sell real estate. This case was decided in 1946 by our Court of Appeals, and appears to be decisive of the issues involved here. See, also, McGilvery v. Shadel, 87 Oh Ap 345.

The only difference in the facts here and those in the Ward case cited above, is that the parties personally signed the receipt for the down payment in the Ward case, whereas in the case under consideration, the receipt was signed by the attorney for the seller of the land in question. From the testimony, there can be no doubt that Attorney Bischoff was representing Mrs. Armentrout in this matter; that he had authority to act for her, both as her attorney and as her agent, in this particular case; and that what he did was undoubtedly with the approval and at the direction of the defndant. See 6 O. Jur. 2d 37, page 55, et seq.

It should be noted that by stipulation between the parties, the interest or lien of the. defendant, The Farmers State Savings Bank of Delta, Ohio, in the land described in the petition in this case, no longer exists, and the defendant, The Farmers State Savings Bank of Delta, Ohio, is not a proper or necessary defendant at this time.

It is therefore the decree of this court that the defendant, Beulah Armentrout, convey the premises named and described in the petition, to plaintiff by general warranty deed, in accordance with the terms of said agreement.


author: PER CURIAM. By PHILLIPS, J.

text:
    FRANKO, Plaintiff-Appellant, v. OHIO EDISON COMPANY, Defendant-Appellee.
    Ohio Appeals, Seventh District, Mahoning County.
    No. 3584.
    Decided March 18, 1954.

      Stephen J. Franko, Youngstown, for plaintiff-appellant.
    Harrington, Huxley & Smith, Youngstown, for defendant-appellee.
   OPINION

PER CURIAM.

The sole question in this case is whether the owner of property abutting upon a public street in a municipality duly dedicated for public use may enjoin a public utility company operating under a franchise granted by the council of the city from erecting poles in front of her property.

Where the street has been dedicated for the use of the public, as in this case, we hold that the only limitation upon the utility company is that the poles shall not interfere with the property owner’s rights of access, light, air and view. (Smith v. Central Power Company, 103 Oh St 681.)

There is no claim nor evidence that there has been any substantial interference with her special easements of access, light, air and view.

The judgment of the Court of Common Pleas denying the injunction is hereby affirmed.

GRIFFITH, PJ, concurs.

PHILLIPS, J, concurs in judgment.

NICHOLS, J, concurs.

No. 3584.

Decided March 18, 1954.

OPINION

By PHILLIPS, J.

Plaintiff, the owner of a parcel of improved real estate situated on Rush Boulevard, where Maywood Drive intersects that street in the Boulevard Park Second Addition to Youngstown, sued defendant, a public utility corporation, in the court of common pleas, and in her third amended petition prayed “that defendant be enjoined, restrained and compelled to discontinue the use of and remove its poles and lines erected in the road passing along plaintiff’s aforesaid property and from Maywood Drive, Euclid Boulevard and Rush Boulevard as herein set forth, and for all relief in law and in equity to which plaintiff is entitled in the premises.”

The trial judge found plaintiff was not entitled “to a mandatory injunction,” and entered “judgment for defendant against plaintiff for costs.”

Plaintiff appealed from that judgment to this court on questions of law, and by assignment of errors contends that “the judgment of the trial court is contrary to and in violation of Art. 1, See. 10, of the Constitution of the State of Ohio, as well as Art. XIII, Sec. 5, of that Constitution,” and “is not supported by sufficient evidence and is contrary to law.”

It is the contention of plaintiff that her evidence discloses that Boulevard Park Second Addition to Yougstown was designed and planned twenty-five years ago as an exclusive residential area, and consists, among other streets, of Rush and Euclid Boulevards, which extend in a general southerly direction from Midlothian Boulevard and are interesected by other duly dedicated streets of that allotment; that each of such streets are ninety feet wide, broken in the center by seven landscaped center islands or parks ten feet wide maintained by the Park Department of the City of Youngstown, and white-way lighted by lights erected on ornamental iron posts by underground current furnished by defendant; that land owners in such allotment granted defendant easements over 'a three foot strip of the rear end of their respective lands for erection of poles and wires for conducting its product to users thereof, of which easement it has availed itself for the past twenty-five years; that without plaintiff’s consent in June 1949 defendant placed within her tree line and that of abutting property owners “a second system of wooden poles, seven (7) in number, at approximately 160 foot intervals with attached equipment for conducting electric current.” It is to this so-called “second system” that plaintiff objects and to which she refers in the prayer of her third amended petition.

The burden of plaintiff’s argument with reference to violation of her constitutional rights is that the erection of the so-called “secondary system,” which she claims is “ugly and unsightly,” without her knowledge or compensation to her therefor, adds a burden upon the fee of the abutting property, and within the meaning of the Ohio Bill of Rights, is a taking of her property without due process of law, and being for a private purpose is a diversion of the street from the purpose originally designed and interferes with and invades her lawful use of the street.

It is stipulated that prior to 1949 defendant served plaintiff’s residence with electricity from its Indianola Avenue substation, which was transmitted from Midlothian Boulevard east to the intersections of Rush and Euclid Boulevards, and connected with pole lines constructed at the rear of residences fronting Rush and Euclid Boulevards.

In 1949 and thereafter defendant supplied plaintiff’s residence with electricity from its new substation situated at Clifton Avenue at Southern Boulevard, which is southwest of plaintiff’s residence; that for the purpose of serving plaintiff and other residents of the area better defendant-extended its pole line on Maywood Drive east to the city limits through the Boulevard Park Addition in accordance with the franchise ordinance with the City of Youngstown, but that plaintiff, and others situated similarly, still receive electricity from the pole line at the rear of their lots, which is now energized from the line on Maywood Avenue rather than the' line on Midlothian Boulevard; and that the extension on Maywood Drive is an essential part of the Ohio Edison Company’s distribution line.

The only difference in the receipt of the electricity now and before 1949 is that the line supplying plaintiff’s residence is energized from the pole line on Maywood Drive rather than from the pole line on Midlothian Boulevard, which lines and supporting poles the evidence discloses in no way interfere with plaintiff’s free ingress or egress to her property.

The Legislature of Ohio has long recognized the use by telephone, telegraph and electric companies of. public streets as proper when such use does not inconvenience the general public in its use thereof. Secs. 9170 and 9195 GC (now §§4931.01 R. C. and 4933.13 R. C.).

A municipality is charged by §3714 GC (now §723.01 R. C.) with the responsibility of maintaining the streets, and the legislature has given the municipality the authority to regulate the use of the streets by such utilities. By §3585 GC (now §711.07 R. C.) the legislature distinguishes between streets of municipalities and highways outside municipalities. This distinction has been followed constantly by the courts of this state.

The Supreme Court has held that the rights of abutting property owners to a city street is limited to access, light, air and view.

There is no evidence of any interference with any of plaintiff’s legal rights, and since she has failed to prove such by the required degree of proof the trial court did not err in denying her injunctive relief.

The judgment of the court of common pleas is affirmed.

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


author: By HORNBECK, J.:

text:
    MUELLER, Plaintiff-Appellant, v. HAAS et, Defendants-Appellees.
    Ohio Appeals, Second District, Shelby County.
    No. 171.
    Decided March 17, 1955.
    David M. Myers, Celina, Carroll V. Lewis, of Blake & Lewis, Sidney, for plaintiff-appellant.
    H. K. Forsythe, Sidney, Don Short, Celina, for Harry Buckley..
    R. E. Boiler, Jr., Sidney, for Edwin H. Haas.
    Melvin Light, Lima, for C. E. Duff.
   OPINION

By HORNBECK, J.:

This is an appeal on questions of law from judgments entered on a directed verdict in favor of Harry Buckley, defendant, and on a verdict of a jury in favor of defendants, Edwin H. Haas and C. E. Duff.

Plaintiff, a minor, instituted her action against the defendants for damages for personal injuries suffered by her in an accident which occurred on State Route 274 in Shelby County, Ohio, on April 29, 1950, shortly before noon. On the day in question, high school students and members of the school band of the Coldwater High School were traveling by auto to Columbus, Ohio, to attend a band festival. There were a number of cars in the caravan, headed by the school bus. One or two cars followed the bus before what is known in the record as the Buckley car, a Chevrolet. Behind the Buckley car was the car of William B. Forsthoefel (a Hudson), in which plaintiff was riding, and there was a number of other cars following. The caravan was moving in an easterly direction and as it approached what is referred to as the Davis residence, which was on the south side of the highway, a car (a Pontiac) was parked, driven by Edwin H. Haas (defendant), a mail carrier. When the plaintiff’s car reached a place near the Pontiac which defendant Haas was driving, an empty truck was approaching from the east,, driven by Dallas Kemp, an employee of defendant, C. E. Duff. A collision occurred between the Buckley car and the Haas car, and between the Buckley car and the truck. The order of these collisions is in dispute. The truck then left its lane, crossed the center line, struck the plaintiff’s car, turned around and upset. Plaintiff’s car ran off to the edge of the road to the south and came to rest.

Plaintiff charged that the defendants were jointly and concurrently negligent, proximately causing the collision in which plaintiff was injured to her damage. Several specifications of negligence were charged against each defendant. Plaintiff averred that Robert Olwine, the driver of the Buckley car, was his agent and acting for him at the time of the collision. At the conclusion of plaintiff’s case the court on motion directed a verdict for defendant Buckley for the reason that it did not appear that Olwine was his agent. The trial judge charged on all of the various specifications of negligence. During his instructions, he defined the law of emergency with particular application to the operation of the truck of defendant, Duff.

There were at least three versions of the manner in which the cars involved came into the collision, which it is not necessary to state with particularity.

Plaintiff assigns four errors: One, in striking from the amended petition the specification of negligence against C. E. Duff concerning “assured clear distance ahead.” Two, in directing a verdict at close of plaintiff’s evidence in favor of Harry Buckley on the question of agency. Three, in charging upon the doctrine of emergency. Four in failing to give the special charge presented by plaintiff-appellant before argument.

In the first amended petition, the plaintiff charged that defendant, Duff, was driving his car at a rate of speed greater than was reasonable and proper, and also that he operated the truck at a speed greater than would permit him to stop within the assured clear distance ahead.

The motion to strike these specifications of negligence was predicated on the claim that they merely stated conclusions of law. Plaintiff then filed a second amended petition, and in the specification charging a rate of speed that was faster than was reasonable and proper, set up the rate of speed. Upon the specification as to the “assured clear distance ahead,” no further attempt was made to plead. Exception was noted to the ruling of the court. The court did not err in its ruling. It is evident that plaintiff did not elect to pursue the “assured clear distance ahead” theory of her case or she would have amended, as was done respecting the charge that the speed of the truck was “greater than was reasonable and proper.”

Second assignment. The evidence on the subject of the agency of Olwine, the driver of the Buckley car, was undisputed. It' appears that following a practice of several years, the use of cars was volunteered for the purpose of transporting the band and others desiring to go to affairs such as the one that was to be attended on the day of the accident. Mr. Buckley consented that his car be used for transportation of the members of the band. He was satisfied to let Mr. Olwine drive it. Olwine was not at the time of the collision acting for or on behalf of the defendant Buckley. Buckley did not direct, nor attempt to reserve the right of control of Olwine in any particular whatever. Restatement Law of Agency, Par. 1, page 10. The use of the car was purely gratuitous on the part of Buckley, and the only relationship between him and Olwine that could have been created was that of bailment. 5 O. Jur. page 89.

The third assignment relates to the charge of the court as to emergency. The trial judge, of course, left to the jury determination whether or not an emergency existed and merely defined the care which was required to be exercised by the driver of the Duff truck, if and when it found that an emergency did exist. Kemp, Haas and Olwine all say that the collisions occurred very closely together; two say a matter of split seconds; another that he did not even have time to apply his brakes. It was undisputed that the truck of defendant, Duff, was, prior to the first collision, moving on the highway on its right or north side thereof, and upon the testimony of Kemp, the driver of the Duff car, he was not only on his side of the road, but clear over beyond the berm and at the edge of the grass immediately before he was first struck, and that the impact of the Buckley car, when it struck the “back duals” put the truck completely out of operation. Upon the testimony thus adduced, it was proper and correct for the court to charge the principle of emergency.

It is urged that the court should have charged “assured clear distance ahead” if it was proper to charge emergency. Inasmuch as the plaintff did not plead assured clear distance ahead, it would not have been proper for the court to charge it as a part of plaintiff’s case.

The fourth assignment of error relates to the special charge requested by plaintiff to be given before argument. This charge read:

“It is the law of Ohio that where three parties are guilty of negligence, and the negligence of one of the parties concurring or cooperating with some negligence of the others, is the proximate cause of the injuries complained of by plaintiff, the party injured may choose between the joint wrongdoers and prosecute her action against any one, or any combination. Therefore, if you find that the defendant Haas was negligent, or that defendant C. E. Duff, through his authorized agent and employee Dallas Kemp, was negligent, and that either of these acts of negligence were the direct and proximate cause of plaintiff’s injuries, then in such case, either or both would be liable to plaintiff, notwithstanding the fact that Robert Olwine was also guilty of negligence, which was a direct and proximate cause of plaintiff’s injuries.”

This charge, in the form tendered, was not sufficiently specific and definite as to the law controlling the subject matter thereof as to require the trial judge to give it. It is general in its statement that where three parties are guilty of negligence, etc., the plaintiff may choose against whom she will proceed without indicating with particularity what three parties it is claimed were negligent. At the time the charge was requested there were but two parties, as such, to the action. Defendant Buckley had been dismissed, and Olwine was not in a status of a party and there was no standard which the jury was authorized to apply to determine if he were negligent. The charge does not require a finding as a prerequisite of a verdict against a defendant that negligence be proven against him in one or more of the particulars charged in the second amendéd petition. The jury might interpret the charge to permit a verdict against one defendant upon proof of a specification of negligence on the part of another defendant. The charge was properly refused.

We find no error assigned well made.

The case was well tried. Although the conflict in the evidence was sharp, the witnesses were definite and specific in their testimony. Upon the plaintiff’s evidence a strong case was made against defendant, Haas, in that without warning he drove in front of the Buckley car at a time when its driver had to swerve to his left to avoid a collision. . On the other hand, if Haas is to be believed, as the jury had the right to do, he was clear off of the highway on his right side thereof when struck by the Buckley car. The case of plaintiff against defendant, Duff, was presented to the jury upon her theory of the negligence with which he was charged. Olwine not being a party the verdict did not speak as to his negligence, if any.

We are impressed with the unfortunate situation of the plaintiff in this case. She clearly was without fault; there is little, if any, suggestion that her driver was negligent and, if he were, his negligence could not be imputed to her. We can not find that she was prejudiced in her rights to a fair and impartial trial in any of the particulars assigned as error.

The judgment will be affirmed.

MILLER, PJ, and WISEMAN, J, concur.


author: By JONES, J:

text:
    GLASS, dba CANTON CYCLE & KEY COMPANY, Bankrupt, In re.
    UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO, EASTERN DIVISION
    No. 72717.
    Decided July 28, 1955.
    Gregory Shott, Trustee, Citizens Bldg., Canton.
    Herman D. Emerman, for Trustee, 700 Peoples Bank Bldg, Canton.
    Maurice W. Wendling, for Bankrupt, 618 Renkert Bldg., Canton.
    Fred Elias George, Beacon Finance & Invst. 323 First Nat’l. Bank Bldg., Canton.
    Meredith & Tait, City Loan & Savings, Canton.
   MEMORANDUM ON PETITION FOR REVIEW

By JONES, J:

This matter is before the court to review an order of the Referee in Bankruptcy approving the petition of bankrupt’s trustee to sell the chattels of bankrupt which included three motor scooters and a truckster, and to apply the proceeds of the sale as part of the assets of the bankrupt estate.

Defendant-creditor, the Beacon Finance & Investment Company, Inc., opposes the order as it applies to the three motor scooters and the truckster, contending that it has a valid lien on said vehicles by virtue Qf prior executed chattel mortgages together with continuous possession of the manufacturer’s statements of origin to said vehicles, all in accord with §4505.13 R. C.

The crux of the argument is whether Beacon’s liens are valid and in accord with the Ohio law. The referee thinks not:

1. Because no certificates of title were applied for or issued by the County Clerk, nor were the chattel mortgages recorded with the County Recorder.

2. That there was no assignment on the manufacturer’s statement of origin from the bankrupt to Beacon Finance.

3. That secret and unrecorded liens upon personal property are in conflict with Section 60a (6) of the Bankruptcy Act which prohibits secret liens.

By stipulation between the parties there is no dispute as to the facts, the controlling ones of which briefly may be stated. The bankrupt on August 7, 1954 borrowed $750.00 from Beacon Finance & Investment Company Inc., as represented by chattel mortgages. There is now due the sum of $729.03. At the time the loan was made by the bankrupt from Beacon Finance, the bankrupt was the owner of motor vehicles as described in manufacturer’s statements of origin to a motor vehicle, and the bankrupt, upon making the loan delivered the originals of the manufacturer’s statements of origin to Beacon Finance. The statements remained in the possession of Beacon Finance until the sale of the personal property described by the trustee, and the order of the reteree. The chattel mortgage and the manufacturer’s statements of origin remained in the actual and continued possession of Beacon Finance from the time the bankrupt made the loan, and the manufacturer’s statements of origin only were surrendered to the trustee on the order of the referee and without the waiver of any rights of Beacon Finance.

The law, as contained in §4505.01 et seq. R. C. (in partcular §4505.13 R. C.), appears to be clear and unequivocal in stating that a lien, as here created, need not be recorded. Further, it is plain that a valid lien is created if the chattel mortgage executed “* * *' is accompanied by delivery of a manufacturer’s or importer’s certificate and followed by actual and continued possession of such certificate by the holder of (the chattel mortgage) •* * The vehicles here involved were “new” (or in the possession of the bankrupt dealer to be sold at retail) as distinguished from “used” (after purchase from the dealer at retail). In the former instance, the manufacturer’s statement of origin is the dealer’s evidence of title (§4505.05 R. C.). While in the latter case, a certificate of title is proof of title in the purchaser (§4505.03 R. C.)

When ownership of the vehicle passes from dealer to purchaser or from purchaser to purchaser that it is mandatory that a certificate of title issue, with any liens noted thereon. Not before. (§§4505.03 R. C. and 4505.06 R. C.)

Next, it was not necessary for the bankrupt-dealer to assign the manufacturer’s statements of origin to Beacon Finance. There is no language in §4505.13 R. C. directing such an assignment. Further, any language to that effect appearing in the form under §4505.07 R. C. when read with §4505.05 R. C., refers to an assignment of the manufacturer’s statement of origin (the Dealer’s title when the dealer transfers possession of the vehicle). In this case there was not a transfer of possession.

Finally, that Section 60a (6) of the Bankruptcy Act would not be violated by enforcing Beacon’s liens, is obvious since “available means of perfecting legal liens” were employed by Beacon, i. e., §4505.13 R. C.

The referee appears to have based his opinion on the general rules which apply in cases respecting mortgages which are not filed for record and upon the fact that secret liens ordinarily will not be recognized or sustained as valid. But the statute under which this case arises is specific in exempting motor vehicles from the operation of the recording requirement and since the statute provides for the procedure followed here the respondent is entitled to the benefit of the provisions of that statute.

Accordingly, Beacon Finance having valid liens on the three motor scooters and the truckster, the petition for review will be granted, and that part of the referee’s order denying Beacon’s liens reversed.


author: By THE COURT:

text:
    PUCKETT, Plaintiff-Appellee v. ARMBRUST, Defendant-Appellant.
    Ohio Appeals, Second District, Greene County.
    No. 551.
    Decided February 11, 1955.
    Pickrel, Schaeffer & Ebeling, William H. Selva, Dayton, for plaintiffappellee.
    Smith, McCallister & Gibney, Xenia, and Harshman, Young, Colvin & Alexander, Dayton, for defendant-appellant.
   OPINION

By THE COURT:

Submitted on motion of appellee to dismiss the appeal for the reason that the order granting a new trial is not a final order.

There is but one assignment of error, namely, that the trial judge in granting the motion for a new trial abused his discretion.

This raises the one determinative question as to the finality of the order.

“The ruling of the trial court granting a motion for a new trial is a final order from which error may be prosecuted to the Court of Appeals where the granting of such motion constituted an abuse of the trial court’s discretion.”

Webster v. Pullman Co., 51 Oh Ap 131.

See, also, Hoffman v. Knollman, 135 Oh St 170.

The motion will be overruled.

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


text:
    PUCKETT, Plaintiff-Appellee v. ARMBRUST, dba Armbrusts Concrete Products, Defendant-Appellant.
    Ohio Appeals, Second District, Greene County.
    No. 551.
    Decided March 5, 1955.
    Pickrel, Schaeffer & Ebeling, Richard H. Packard, of Counsel, Dayton, for plaintiff-appellee.
    Smith, McCallister & Gibney, Xenia, and Harshman, Young, Colvin & Alexander, Mr. Robert C. Alexander, of Counsel, Dayton, for defendant-appellant.
   OPINION

By THE COURT:

This is a law appeal from the judgment of the Common Pleas Court for Greene County sustaining the plaintiff-appellee’s motion for a new trial. The action was one for personal injuries arising out of a collision between two trucks, in one of which the plaintiff-appellee was a passenger.

A general verdict was returned in favor of the defendant. The motion was grounded upon the following reasons:

(1) That the judgment is not sustained by sufficient evidence.

(2) That the judgment is contrary to law.

(3) That errors of law occurred at the trial which were excepted to by the plaintiff.

The entry sustaining the motion is general; hence, it may be assumed for the purposes of considering this appeal that the Court found for the plaintiff-appellee on one or all of the grounds enumerated in the motion. The record discloses that there was a substantial conflict in the testimony relating to contributory negligence on the part of the plaintiff. Under such a state of the record it may not be said that the trial court abused its discretion in sustaining the motion. All of the defendant’s testimony on this question was of a negative character, which the Court could have considered as having little or no weight as compared with the positive testimony offered on behalf of the plaintiffappellee. In Clark v. Baltimore & Ohio Rd. Co., 64 Abs 431, the second paragraph of the syllabus reads as follows:

“Where a witness testifies that warning signals were not given or that he did not hear such warning signals, and it appears that the witness was not listening to hear such signals or not paying attention as to whether they were given or not, such testimony is negative, and in the face of substantial uncontradicted testimony that the signals were given, the evidence is not sufficient to present to the jury the question as to whether such signals were given.”

See, also, Hicks, Admr., v. Baltimore & Ohio R. R. Co., 160 Oh St 307.

The defendant-appellant relies solely upon alleged statements made by the trial judge in his opinion in sustaining the motion but which are not a part of the bill of exceptions. Such matter may not be taken into consideration by a reviewing court. In Treiber v. Jaster, 55 Oh Ap 64, it is said:

“In the bill of exceptions filed in this case there is no evidence of any sort relating to the ground or grounds upon which the court acted in granting either of these new trials. Counsel for appellant in his brief quotes what purports to be the opinion of the trial judge in granting the second new trial. If such an opinion was handed down by the trial judge it is sufficient to say that it has not been brought into the record, and this court cannot consider it to supply a fact not otherwise appearing in the record.”

The appellant cites In re Estate of Spidel, 64 Abs 71, by this Court, to support his contention, but we are unable to agree with his conclusion. On page 74 we say:

“We have been favored with the opinion of the trial judge which discloses appreciation and careful consideration of the questions involved in his order. We, of course, do not and cannot consider this opinion as findings of fact and law or as the order appealed from, but, it is of value insofar as it sets forth the reasons supporting the conclusion reached.”

We think this statement is in accord with the authorities cited by the appellee. It merely adds, however, that the opinion is of some value to the Court in arriving at its own conclusion. Certainly if it contains authorities pertinent to the issues presented the Court would welcome such assistance, but as stated supra, it “cannot consider this opinion as findings of fact and law * * *.”

We find no abuse of discretion on the part of the trial court and the judgment will be affirmed.

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