author: HUNT, J.

text:
    CAMERON, Administratrix, Appellant v. KENYON-CONNELL COMMERCIAL CO. et al., Respondents.
    [No. 1,018.]
    [Submitted January 23, 1899.
    Decided March 20, 1899.]

      Corporations — Nuisa/nce — Liability of Directors — Trial— Nonsuit.

    1. On motion for a nonsuit, everything which the evidence tends to prove must be taken as true.
    2. The fact that powder stored in defendants’ warehouse did not exceed the quantity allowed by a city ordinance does not relieve them Irom liability for death from an
    ■ explosion, if the amount kept by defendants was in excess of that authorized by a state statute.
    3. The directors of a corporation are personally liable for the death of one killed by the explosion of powder unlawfuly kept in the corporation’s warehouse, though they had no knowledge thereof, if, by exercising ordinary diligence as directors, they could have known that the warehouse contained an unlawful amount.

      i. In an action to recover of directors for the death of one killed by the explosion of an unlawful amount of powder kept in the corporation’s warehouse, the burden is on the directors to show that by the exercise of ordinary diligence in the management of the business they could not have discovered that powder was stored in unlawful quantities.

      Appeal from District Court, Silver Bow County; J. J. McTIatton, Jxidge.

    Action by Minnie Cameron, as administratrix of Angus D. Cameron, deceased, against Kenyon-Connell Commercial Company, a corporation, and M. J. Connell, W. R. Kenyon, J. E. ’ Gaylord, C. H. Palmer and W. A. Clark. Motion for nonsuit as to defendants Kenyon, Connell, Palmer and Gay-lord was granted. From an order denying a new trial as to such defendants, plaintiff appeals.
    Reversed.

      T. J. Walsh and J. W. Kinsley, for Appellant.

      Wm. II. De Witt and John F. Forbis, for Respondents.
    In all civil cases we shall find that the officer or agent of a corporation becomes liable with the corporation primarily to third parties, whenever by malfeasance or by misfeasance he has contributed to the injury to such third person. On the contrary he is never liable to third persons for acts of nonfeasance, but may be held liable therefor to his principal, the corporation. Nor can this be held to be a refined distinction. It is the difference between doing and not doing; the difference between acting and not acting; the difference between perpetrating a wrong and doing nothing. He .may be held by third parties for doing that which ought not to have done, but he cannot be held for a mere omission. For omissions his principal only may hold him responsible. ■ The distinction must be here observed between one acting for himself as principal and as agent for another. Had respondents been the principal as the defendant corporation was, the law would not permit them to plead that they took no part in the transaction or were ignorant of what occurred. The act of the agent is the act of the principal. But when they show that they are simply agents with others of a common master then the defense becomes effectual. (Thompson on Corporations, Sections 4091, 4096, 4097, 6289; Banning v. D. M. Osborne <& Go., 102 N. Y. 441; Ilewitt v. Swift, 3 Allen 420; Nunnelly v. Southern Iron Co., 28 L. E. A. 421 and notes; Beach on Private Corporations, 253-4-5, 262; Bath v. Catón, 37 Mich. 199; llarrirnan v. Stowe, 63 Mo. 93; Carey v. JRochereau 16 Fed. 87; IBenshaw v. Noble 7 Ohio St. 232; Labodie v. Ilawley, 61 Tex. 177 (48 Am. Eep. 278); Phelps v. Wait, 30 N. Y. 78 \ Peck v. Cooper, 112 111. 192, (54 Am. Eep. 231 and notes); Lcme v. Colton 12 Mod. 488). To say that officers are chargeable with knowledge of what its agents do, is to charge them with liability for all acts of the agents. If this is the rule a great deal or time has been wasted by the courts in discussing the question as we have shown by the authorities cited. All of this should have been obviated by charging the officer with knowledge, and then we should not have this discussion of nonfeasance and misfeasance, because it is admitted that the officers are liable if the powder was unlawfully stored with their knowledge.

      That there is no presumption of knowledge on the officers’ part. (Ruddy. Robinson, 126 N. Y. 113 (12 L. R. A. 473; Fisher y. Graves, 80 Fed. 690.)
   HUNT, J.

Plaintiff, as administratrix of the estate of Angus D. Cameron, deceased, brought this action against the Kenyon-Connell Commercial Company, a corporation, and M. J. Connell, W. R. Kenyon, J. E. Gaylord, C. H. Palmer and W. A. Clark, trustees and agents of the corporation, for damages by reason of the killing of Angus D. Cameron, on January 16, 1896, through force of an explosion of giant .powder negligently and unlawfully kept by defendant corporation in its warehouse within the limits of the city of Butte.

The corporation denied the negligence and unlawful acts averred. Kenyon, Connell ' and Palmer each separately answered, and denied any unlawful or negligent act on his part, and each affirmatively pleaded that the warehouse was the property of the corporation, and that he never authorized or directed any powder to be stored therein, and was ignorant of the fact that any powder was stored therein. Gaylord and Clark each denied the allegations of the complaint, or that he was a managing agent or [rustee or officer of the corporation.

Trial to jury. Motion for nonsuit by individual defendants was granted. Thereafter plaintiff’s motion for a new trial as to defendants Kenyon, Connell, Palmer and Gaylord was overruled. Plaintiff appeals.

The record discloses these facts: The defendant corporation dealt in hardware, merchandise and powder. It owned a large frame, iron-roofed warehouse, near a railroad depot within the corporate limits of the city of Butte, where it kept its merchandise, including Hercules powder, a dangerous explosive compound of nitroglycerine and other substances. On the night of January 15, 1895, the warehouse took fire. Plaintiff’s intestate, Cameron, was the chief of the fire department of the city of Butte, and commanded the firemen who responded to the alarm: While the firemen were, actually engaged in an endeavor to put the fire out, a fearful expíosion occurred within the corporation’s warehouse, and many persons, including Cameron, were killed.

From the beginning of the year 1893, Hercules and giant powder had been kept in the warehouse. Defendants Kenyon and Connell had both been seen in or about the building during 1893, and at divers times up to the time of the explosion, —Kenyon often, Connell very seldom, the other defendants never. The quantity of powder kept in the warehouse about the 1st of each month was from 20 to 50 boxes, larger quantities being stored in a powder magazine three miles out of the city. On the day before the explosion a witness saw some 1 boxes of powder, 50.pounds in each box, in the warehouse. An employe, one Orcutt, had immediate charge of the warehouse, and ordered the powder put where it was. He said that on the day of the explosion he thought there was” somewhere about three to five cases of powder in the warehouse; while another witness, a mining superintendent accustomed to using powder, said he thought a ton must have exploded on the night of the fire.

Defendant Connell was president of the corporation; Kenyon was general manager. Kenyon’s duties were to give attention to the corporation’s business, his particular duties being to look after the financial part, and ordering goods, but not to manage or control the warehouse or magazine, which were under the warehouseman Orcutt’s direct charge. Neither Connell, the president, nor any of the other trustees, except Kenyon, had anything whatever to do with the actual personal management of the affairs of the corporation. -

It is plain that this corporation, like many others in the commercial world, had one head — director—to whom all the other trustees gave the entire practical management of the concern.

It thus furnishes but a single instance of the common practice among business men to incorporate commercial enterprises and, in doing so, of their trusting the entire actual management to the one director who is familiar with, and assumes the real control of, the particular business undertaken. This custom has doubtless been the outgrowth of a belief, generally correct too, that, by incorporating mercantile ox-other undertakings, directors are not liable to creditors in case of business reverses, while those vho associate themselves as members of a partnership are.

But, notwithstanding all this, there are various unavoidable responsibilities that attach themselves inseparably to the office of corporate directorship, which, in case of negligence or misconduct, often illustrate the risks' ixxcidental to accept ing such positions of trust in a corporation and of not prxxdently guarding against their possible consequences.

It is a general rule that the ordinary business of a corporation is managed in the name and on behalf of the corporation by particular agents, chosen by the stockholders. These, agents" are the directors. For their acts, performed within the apparent scope of their authority, the corporation is responsible, while, e converso, the corporation can act through these agents alone.

These principles are generally familiar to business men, as well as to lawyers. They control the relation of the artificial being, the corporation, to the world at large. They find their foundation in the law of agency, which makes the corporation the principal; still, they are extended, under certain conditions, far enough to inculpate the agents or directors of the corporation, notwithstanding the fact that- the principal may also be liable for a wrong done.

Now, bearing in mind that this case presents itself upon a motion fox- a nonsuit and that we must accordingly consider as true everything which the evidence tended to prove on the trial, we have before us a corporation guilty of a nuisance, by having kept in a frame warehouse within the limits of an incorporated city, in the vicinity of railroad depots and other buildings, an amount of Hercules powder in excess of the quantity — 50 pounds — allowed to be stored therein by the laws of the State. (Laws Mont. Ex. Sess. 1887, p. 68; Comp. St. 1887, First Division, Sec. 361; Cheatham v. Shearon, 1 Swan. (Tenn.) 213). It is vex-y hard to conceive of anything more terrible in its danger to life and property than a quantity of highly-explosive powder kept near to where people live or do business. Such a menace, when known, obstructs that free use of property which the law assures to an owner; while nothing could more seriously interfere with the comfortable enjoyment of life than the knowledge that in one’s neighborhood there is a frame building in which nitroglycerine explosives are stored in large quantities. No ordinance of a city could authorize a larger quantity of powder to be kept by a corporation within the city limits than the state statute allows, unless some special exception is to be found exempting the inhabitants of such city from the operation of the general statute. None such affecting Butte is known to us, however; so we must regard the ordinance of that city, pleaded by defendants, which permits 150 pounds of powder to be kept at one time by a company in its warehouse within the limits of that city, as inconsistent with the State law, without force, and immaterial to the case before us.

The corporation, therefore, by maintaining this nuisance, became the subject of indictment for misdemeanor (Whart. Cr. Law, Sec. 91), as well as liable in civil action for injury to person or property caused by the nuisance (Heeg v. Licht, 80 N. Y. 579).

These propositions are too plain for extended comment. They demonstrate a liability to this plaintiff — assuming always the evidence is uncontradicted. Hence we pass to the more direct inquiry whether the directors of the guilty corporation are also liable for Cameron’s death.

As said before, the trustees manage the stock, property and concerns of a corporation (Comp. St. Fifth Div., Sec: 450); wherefore it is difficult to see how all responsibility in this management can be avoided as long as the trustees hold their offices. Certainly, the ministerial work of a corporation may be delegated to subordinate agents, and often must be. The details of a corporation’s business necessitates this; and if directors act in good faith, and with reasonable care and diligence in appointing and supervising such inferior agents, they are not personally responsible for damages occasioned by the agents’ negligence, or even crimes. (Thomp. Corp., Sec. 4107). But a director cannot wholly escape his duty of supervision or transfer his authority to represent his principal, at least without the principal's consent; otherwise he could evade every responsibility imposed by law upon him by simply absenting himself from meetings, or by avoiding information of the acts of the other directors in expressing the will of the corporation, or by delegating an employe to act as trustee for him. Morawetz on Private Corporations, in Section 536, says: “The general supervision and direction of the affairs of a corporation are especially intrusted by the shareholders to the board of directors; it is upon the personal care and attention of the directors that the shareholders depend for the success of their enterprise. It follows that authority to delegate these general powers of management cannot be implied. Thus, the directors of a company have no implied authority to enter into a. contract with a creditor by which the entire management of the company’s affairs is placed in his control until the debt has been paid.

Third persons may hold directors liable in positive tort, upon the principle that a positive wrong done by a servant or ordinary agent must be applied to the misfeasance of directors also. (Salmon v. Richardson, 30 Conn. 360, 79 Am. Dec. 255.)

Persons having in their custody-gunpowder or other instruments of danger should keep them with the utmost care. “The risk incident to dealing with fire, firearms, explosive or highly inflammable matters, corrosive or otherwise dangerous or noxious fluids, * * “ is accounted by the common law among those which subject the actor to strict responsibility. Sometimes the term ‘consummate care’ is used to describe the amount of caution required; but it is doubtful -whether even this be strong enough. At. least, we do not know of any English case of this kind (not falling under some recognized head of exception) where unsuccessful diligence on the defendant’s part was held to exonerate him.” (Webb’s Pollock on Torts, p. 615.)

A company charged with an obligation of this nature cannot devolve it upon another in a manner so as to exonerate the company from a liability for an injury caused to a third person by the negligent way in which the duty pertaining to the care of giant powder or other dangerous explosives may be executed. In torts, the relation of principal and agent cannot relieve the wrongdoer. (Berghoff v. McDonald, 87 Ind. 559.)

It is unnecessary to consider the rule which relieves the master from liability for his servant’s acts, where the servant does something outside of his employment, — for that is not involved.

But the case does present facts to which this principle fits: that whatever the servant is intrusted by the master to do for him must be performed with a like degree of care which the law holds the master to were he acting for himself.

We apply this principle for the reason that there is a presumption that the trustees of a trading corporation know of the principal articles in which the company deals, and whether or not such articles are highly dangerous to life and property.

It is therefore the duty of the trustees of a corporation dealing in explosives to exercise such reasonable supervision over the management of their company’s business as will result in the observance of the utmost care on the part of the subordinates who direct or handle the explosives. This rule grows out of “the great principle of social duty that every man, in the management of his own affairs, whether by himself or by his agents or servants, shall so conduct'them as not to injure another; and if he does not, and another thereby sustains damage, he shall answer for it.” (Farwell v. B. & W. Railroad Co., 4 Metc. (Mass.) 49.) It is likewise their duty to avoid the creation of nuisances by their corporation, through its employes acting within the line of their duties.

Nor will inaction by itself overthrow the force of this obligation upon trustees to' so control their corporation’s business as to not negligently injure third persons. Along with the assumption of the duties of trusteeship go the duties of exercising reasonable care in the manner of performing those duties. This reasonable care appears not to have been exercised in this case, where the corporation, by its trustees, permitted a public nuisance to be created, and to continue, whereby, as a consequence of the act of permitting it, a third person, not in fault, has been killed.

Because directors are themselves agents, it is none the less true that they owe a common-law duty to third persons. If they violate that duty, they are responsible, whether the violation is the result of a wrongful omission or commission. (Mechem on Agency, Sec. 572.) Were the rule such that wrongful commission alone meant liability, as before indicated, directors’ statutory duties to manage would be sufficiently performed by absence; and, the denser the ignorance on a director’s part of the business of his concern, the more certain his exoneration from liability for the tortious acts of the company’s employes. Such a rule would be unhealthy and unsound.

The liability of a director in tort is not to be. avoided by his ‘ ‘vicarious character, ’ ’ where the tort of the corporation has been committed through the directors. (Nunnelly v. So. Iron Co. (Tenn. Sup.) 28 Lawy. Rep. Ann. 421, s. c. 29, S. W. 361; Bank v. Byers, 139 Mo. 627, 41 S. W. 325; Delaney v. Rochereau, 34 La. Ann. 1123.)

Relationship of contract to a corporation neither adds to nor subtracts from a man’s duty to strangers to so use his own property, or that under his control, as not to injure another. (Baird v. Shipman (Ill. Sup.) 7 L. R. A. 128, 23 N. E. 384; Riche’s note to Nunnelly v. So. Iron Co., supra Jenne v. Sutton, 43 N. J. Law, 257; Mayer v. Thompson-Hutchinson Building Co. (Ala.) 28 L. R. A. 433, 16 South. 620.

Eminent judges have drawn distinctions between a trustee’s liability for misfeasance, malfeasance, and nonfeasance. (Bell v. Josselyn, 3 Gray, 309.) But they are of no vital importance on this appeal. Nevertheless, reasoning upon these distinctions, defendants have argued that they are liable, if at all, to the corporation only, inasmuch as the record shows nonfeasance merely, or nonexecution of the duties of their directorships. This argument seems to overlook the proposition that directors are charged with the affirmative duty of' knowing something of the management of their company’s business, and of exercising reasonable supervision of its management.

Management usually signifies positive, rather than negative, conduct.

As a matter of defense, it is proper to show all facts by which the jury can say whether the inaction or ignorance relied on is a sufficient excuse for the wrong done. But we have no hesitation in saying that, • upon a state of facts like that before us, nonexecution which resulted in the positive act of a creation and maintenance of a continuing nuisance on account of which a third person was killed amounts, unless explained, to misfeasance upon the part of all the directors of the company, except as to Kenyon, who, it appears prima facie, must have actually known of and authorized the nuisance. As to him it was malfeasance.

A director who knew nothing of the nuisance, and who could not, by exercising ordinary diligence in control, have known of it, or, generally speaking, one who, considering the situation and all the attendant circumstances, has performed his duty of taking care, is not liable, and cannot be held so. In this case the defense must show this though, for a prima facie case is made by plaintiff.

Due care involves several elements relative to the circumstances of the case. Ordinary care, for instance, on the part of a corporation that deals m hardware would not prevent the storage of large quantities of nails in a frame warehouse in the middle of a city. ■ The dangers from doing so would be slight, even in case of fire or lightning; but such a practice with giant powder or nitroglycerine would be negligence, fraught with imminent peril to life and property. We said, in considering the law of negligence in a boiler explosion case (Johnson v. B. & M. Mining Co., 16 Mont. 175, 40 Pac. 301):

“Familiar underlying principles, evolved from generations of experience and thought, are to be applied to the peculiar phases presented by the facts and circumstances of the particular case under investigation. And so we find the opinions, in discussing the definition of ‘ordinary care, ’ recognize that no fixed arbitrary rule can be laid down, but that the degree of care and vigilance required varies according to the exigencies which require attention and vigilance, conforming in amount and degree to the particular circumstances under which they are to be exercised. ’ ’

In Railway Co. v. Ives, 144 U. S. 408, 12 Sup. Ct. 679, the Court, in very clear language, said:

‘ ‘There is no fixed standard in the law by which a court is enabled to arbitrarily say in every case what conduct shall be considered reasonable and prudent, and what shall constitute ordinary care, under any and all circumstances. The terms ‘ordinary care,’ ‘reasonable prudence,’ and such like terms, as applied to the conduct and affairs of men, have a relative significance, and cannot be arbitrarily defined. What may be deemed ordinary care in one case may, under different surroundings and circumstances, be gross negligence. ■ The policy of the law has relegated the determination of such questions to the jury, under proper instructions from the court. It is their province to note the special circumstances and surroundings of each particular case, and then say whether the conduct of the parties in that case was such as would be expected of reasonable, prudent men, under a similar state of affairs. When a given state of' facts is such that reasonable men may fairly differ upon the question as to whether there was negligence or not, the determination of the matter is for the jury. It is only where the facts are such that all reasonable men must draw the same conclusion from them that the question of negligence is ever considered as one of law for the court. ”

After all, therefore, the question of the personal liability of the officers of this corporation for the negligence which resulted in Cameron’s death, resolves itself into whether-or not they exercised reasonable diligence in the control and supervision in their management of the corporation’s business, or whether they were negligent in doing or not doing so' under all the circumstances of the case.

The case must be reversed and remanded for a new trial. It is so ordered.

Reversed and remanded.

Brantly, C. J., and Pigott, J., concur.


source: Caselaw Access Project

author: PIGOTT, J.

license: Public Domain

text:
    SWEETMAN, Appellant v. RAMSEY, Sheriff, Respondent.
    [No. 1,026.]
    [Submitted February 14, 1899.
    Decided March 20, 1899.]

      Chattel Mortgages — Rights of Mortgagee — Admissibility of Evidence — Estoppel—Pleading.
    1. Plaintiff advertised chattels for sale under a mortgage from T. to plaintiff, after which they were taken from plaintiff’s possession on execution against T. In an action to recover possession, held, that the mortgage and notice of sale did not estop plaintiff from denying that T. had any interest in the property at the time of levy, if plaintiff did not intend that the creditor should rely on the information contained in the mortgage and notice, and such information did not induce the creditor to -issue the execution.
    2. Though an answer does not set out matter sufficient to constitute a’ defense, it will not be stricken on the ground that it is a sham, if from the answer itself the matter does not appear to be false.
    3. Plaintiff advertised chattels for sale under a mortgage from T. to plaintiff, after which they were taken from plaintiff’s possession on execution against T. In an action to recover possession, the defendant answered that the mortgage and notice of sale estopped plaintiff from denying T.’s ownership at the time of the levy. Held, that though the answer was relevant, as supporting defendant’s claim of T.’s ownership, it should be stricken as redundant, since it consisted of evidentiary matter, merely tending to show the ultimate fact of T.’s ownership.
    4. In an action by a mortgagee to recover possession of chattels taken from him under execution against the mortgagor, in which plaintiff claims that the mortgagor had no interest at the time of the levy, the mortgage and notice of sale thereunder are admissible on behalf of defendant, as tending to show the interest that the mortgagor had at the time of levy.

      Appeal from District Court, Yellowstone County/ George R. Milburn, Judge.

    Action by Ered Sweetman against John M. Ramsey, sheriff of Yellowstone county. From a judgment for defendant, and an order denying plaintiff a new trial, plaintiff appeals.
    Reversed.

      Chas. R. Middleton, for Appellant.

      J. R. Goss and O. F. Goddard, for Respondent.
   PIGOTT, J.

This was an action to recover 3,400 sheep, valued at $12,000, to the exclusive possession of which plaintiff alleges he was entitled as bailee under a delivery by the owner for the purpose of pasturing, herding, feeding and controlling, with power of sale and disposal in plaintiff; the complaint alleging, among other things, that defendant on January 12, 1893, wrongfully took the sheep, and yet withholds them from plaintiff. The answer contains denials of the bailment and right of possession in plaintiff, and wrongful taking or detention by defendant, and sets up as a justification that defendant, as sheriff, seized the sheep under an execution in favor of the First National Bank of Billings, and against the property of one Tinkler, by which he was commanded to satisfy a judgment of the bank for $964, and that Tinkler was the owner of an undivided half interest in the sheep. For a defense by way of estoppel, it is alleged that in August, 1S9’0, Tinkler executed to one Thomas Kent a promissory note for $2,100, to secure the payment of which Tinkler made to Kent a mortgage upon the sheep in question, which mortgage was filed in the proper county clerk’s office, and expired, as to all persons except the parties thereto, in October, 1891; that on January 3, 1893, Kent assigned the mortgage, without consideration, to plaintiff, which assignment was also filed; that on the same day plaintiff, as assignee of the mortgage, began to take the initiatory steps towards execution of the power of sale conferred by the mortgage, by directing the defendant, as sheriff, to sell at public vendue all of the interest of Tinkler in the sheep; and that the sheriff posted notices that the sale would take place on January 12, 1893 — the notice being to the effect that the sheriff would sell to the highest bidder the property described in the mortgage, being the undivided half interest, or whatever the interest might be, of Tinkler in the sheep mentioned. The plaintiff moved the court to strike out the matter pleaded as estoppel, upon the ground of irrelevancy and immateriality, and also upon the ground that it was sham, and for the further reason that it was redundant. Upon the overruling of the motion, plaintiff replied, denying that he was estopped, and denying that Tinkler owned or had any interest in the sheep, and setting up affirmatively much evidentiary matter, which, while not proper in a pleading, was responsive to the answer. The jury found for the defendant. Plaintiff appeals from the judgment against him, and also from the order denying his motion for a new trial.

Throughout the trial the district court consistently held to the view that the facts alleged as constituting estoppel by conduct would, if sustained by proof, necessarily defeat the plaintiff. It is clear, however, that the truth of the matter so pleaded could not estop plaintiff from showing that Tinkler was not the owner of, or interested in, the sheep at the time the sheriff seized them under the writ. The absence of an averment that plaintiff knew or had reason to believe that the bank or the defendant intended to act upon the information contained in the mortgage, and upon the supposed representation in the notice of sale; the failure to charge that such, or any, representations or acts of plaintiff, or of those in privity with him, were made with the design or intent that they should be acted upon by the bank or the defendant; and the omission to state that such conduct induced the taking out and levy of the execution — effectually prevent that portion of the answer to which the motion was directed from being sufficient to constitute a defense by way of estoppel. (Meyendorf v. Frohner, 3 Mont. 321; Muller v. Pondir, 55 N. Y. 325; Danforth v. Adams, 29 Conn. 107; Kuhl v. Jersey City, 8 C. E. Green (23 N. J. Eq.) 84; Mayenborg v. Haynes, 50 N. Y. 675; Andrews v. Lyons, 93 Mass. 349, 11 Allen 349). The matter is not sham, for it does not appear to be false from consideration of the pleadings themselves; it has connection with the cause of action, and with the defense properly interposed, and therefore is not irrelevant; but the matter is redundant, because it .is unnecessary, and consists merely of evidence tending in some degree to prove the ultimate fact relied upon in defense, namely, that Tinkler had property in the sheep on January 12, 1893. The court should have granted the motion and thereby purged the answer. After the motion was denied, the matter sought to be eliminated was mere surplusage.

The evidence touching the interest which Tinkler at one time had in the sheep, as well as that in respect of the chattel mortgage made by him to Kent, and of the notice of sale referred to (which might possibly be considered by the jury as in the nature of an admission against interest, or as a declaration in disparagement of title), was relevant, as having a tendency to throw light upon the question whether Tinkler possessed an interest in the sheep at the time they were seized; but wholly immaterial and irrelevant was the evidence adduced tending to show either that the bank, in causing the execution to be issued, or the defendant, in levying it, acted in the belief that the sheep, or any interest in them, belonged to Tinkler. Its natural and almost inevitable effect would be to mislead the jury and divert their attention from the issues to a question not involved; its admission was error prejudicial to plaintiff. We have, moreover, carefully examined the record and find no evidence whatever tending to establish estoppel.

.Consistently with the theory entertained by its learned Judge, the District Court charged in substance, that if the jury found that the bank, by the mortgage made by Tinkler, and the proceeding taken to foreclose it, was induced to place in the hands of the sheriff the execution which he levied upon the sheep, and that the bank, by reason of the contents of the mortgage and notice of sale, in good faith believed that Tinkler owned an interest in the sheep on January 12, 1893, then defendant must prevail, because the plaintiff would not be permitted in this action to deny that Tinkler was owner of an interest. For the reasons heretofore stated, this was misdirection.

The judgment and order refusing a new trial will be reversed, and the cause remanded. It is so ordered. Let remittur go forthwith.

Reversed a/nd remanded.

Brantly, C. J., and Hunt, J., concur.


text:
    CREEK, Appellant, v. BOZEMAN WATER WORKS CO., Respondent.
    [No. 1,078.]
    [Submitted March 16, 1899.
    Decided March 20. 1899.]

      Appeal and Error — Appeal Bond — Sufficiency of- — Ambiguity of — Dismissal of Appeal — Practice.

      1. An appeal undertaking recited four distinct appeals, — one from the judgment, and three from orders, — and that, in consideration “of such appeal, * * * appellant will pay all damages and costs which may be awarded against her.” Held, that the undertaking was invalid for ambiguity, in not stating which appeal it was intended to secure.
    2. If an appeal undertaking, reciting separate appeals from the judgment and from different orders, is void for ambiguity as to which appeal it is intended to refer to, appellant cannot escape the effect of the ambiguity by claiming that the orders are not appealable, and the bond therefore refers to the judgment, as the court, in determining the validity of the undertaking, will not examine the record to see what 'orders are appealable.
    3. If, after the expiration of the statutory time for perfecting appeals, an appeal undertaking is adjudged void for ambiguity, appellant cannot then prevent a dismissal by filing a valid bond, since it would operate to extend appellant’s time for perfecting his appeal.
    4. Statutory provisions regulating the manner of taking and perfecting appeals must be strictly pursued.

      Appeal from District Court, Gallatin County; Horace R. BucJc, Judge.

    • Action by Rachel E. Creek against the Bozeman Water Works Company. Judgment for defendant, and plaintiff appeals. On motion to dismiss the appeal.
    Appeal dismissed.

      CocJcrill dc Pierce, for Appellant.

      Hartman. Bros, da Stewa/rt, for Respondent.
   PIGOTT, J.

Respondent moves the Court to dismiss the appeals upon the ground that the undertaking is. so ambiguous that it cannot be determined therefrom for which appeal it was given. Appellant duly filed and served a notice that she appealed to this Court from the judgment and from an order denying a new trial, and also from two several orders. The body of the undertaking on appeal is as follows:

“Whereas, the plaintiff in the above-entitled action is about to appeal to the Supreme Court of the State of Montana from a judgment therein made and entered in the said District Court on the 23d day of April, 1896, against the plaintiff and in favor of the defendant, and from the whole thereof; also, from the decision and order of the said District Court made in said action on the 6th day of May, 1896, overruling plaintiff’s objection to certain findings named in said order, and denying plaintiff’s motion to correct said findings, and from the whole of said order; also, from the decision and order of the said District Court made in said action on May 6, 1896, refusing and denying plaintiff’s motion and request for additional findings, and from the whole thereof; also, from the decision and order of said District Court made in said action December 11, 1896, denying plaintiff’s motion for a new trial, and from the whole thereof. Now, therefore, in consideration of the premises and such appeal, we, the undersigned householders of the State of Montana, do hereby jointly and severally undertake and promise, on the part of the appellant, that the said appellant will pay all damages and costs which may be awarded against her on the appeal, or on dismissal thereof, not exceeding three hundred dollars, to which amount we acknowledge ourselves jointly and severally bound.”

It will be observed that, although there-are four separate and distinct appeals, — one of them being from a judgment, and three from orders, —the condition of the undertaking is that, in consideration “of such appeal, * * * appellant will pay all damages and costs which may be awarded against her on the appeal, or on dismissal thereof, not exceeding three hundred dollars.” While but one undertaking 'in the áum of $300 is required on appeal from a final judgment and from an order refusing or granting a new trial, taken at the same time (Watkins v. Morris, 14 Mont. 354, 36 Pac. 452; Code of Civil Procedure, Sec. 1731), yet this rule of practice does not apply when an appeal is taken from a judgment and from any other order, or from several orders only. No appeal is effectual for any purpose, unless within five days after service of the notice of appeal an undertaking in the sum of $300, conditioned conformably to Section 1725 of the Code of Civil Procedure, be filed or waived, or a deposit of money be made (Code of Civil Procedure, Sec. 1724); and the undertakings on several appeals prosecuted from the judgment and from any order or orders, or from orders only, when entered in the same action or proceeding, may be in one instrument, or several, at the option of the appellant. (Section 1731, supra.)

Here there is nothing to indicate whether the undertaking is intended to refer to the judgment and order refusing a new trial to the order overruling objections to certain findings, or to the order denying the request for additional findings. “The undertaking is no undertaking at all. It is so ambiguous that it must be regarded as if none had been filed. ” (Home & Loan Associates v. Wilkins, 71 Cal. 626, 12 Pac. 799.) With the exception of a portion of Section 1731, the sections mentioned were adopted from the statutes of California, and that such an undertaking • as the one in the case at bar is void is held in the following cases: Corcoran v. Desmond, 71 Cal. 100, 11 Pac. 815; McCormick v. Belvin, 96 Cal. 182, 31 Pac. 16; Centerville Ditch Co. v. Batchold, 109 Cal. 111, 41 Pac. 813; In re Heydenfeldt's Estate, 119 Cal. 346, 51 Pac. 543. Even without the persuasive effect of these decisions, we have no doubt that the undertaking is void for ambiguity.

Appellant argues, however, that neither of the orders in respect of the findings is appealable, and that, therefore, the undertaking must be referred to the appeals from the judgment and order refusing a new trial. Considering this identical point in Centerville Ditch Co. v. Batchold, supra, the court held that, “when a motion to dismiss'an appeal is made upon the ground that the appeal has not been perfected, the appellant cannot ask the court to look into the record for the purpose of determining whether the order he has appealed from is appealable. The appellant cannot protect himself against a defective appeal by saying that he had no right to appeal.” And in In re Heydenfeldt's Estate, supra, it was decided that ‘ ‘where a motion to dismiss an appeal is not upon the ground that the thing appealed from is not appealable, but upon the ground that there has not been a compliance with the statutory provision prescribing the mode of taking an appeal, then we cannot consider whether either of the orders appealed from is appealable. ’ 5 The opinions in these cases state clearly the reasons leading to the result announced, and we are satisfied that the reasons are sound and the conclusion inevitable.

Appellant has offered to file a new undertaking in this Court, claiming the right to do so under Section 1740 of the Code of Civil Procedure. Since the instrument filed in the court below, and called an “undertaking,” is so defective and ambiguous as to be void, to permit the paper now tendered to be filed would have the effect of allowing an appeal to be perfected after the time prescribed by statute. (Centerville Ditch Co. v. Batchold and In re Heydenfeldt's Estate, supra.) In Woodman v. Calkins, 12 Mont. 456, 31 Pac. 63, the undertaking filed in the court below was not void, and appellants were permitted by this Court to file a new undertaking. In Morse v. Callantine, 19 Mont. 87, 47 Pac. 635, where there were three appeals, and but one undertaking, in $300, respondent, upon the argument of the merits, contended that the appeals should be dismissed for want of jurisdiction; and it was held that the question of the insufficiency or invalidity of the appeal bond was not properly presented, because not raised by a formal motion to dismiss, distinct from the printed brief on the merits. The intimation there made, that the undertaking would not have been declared void, if attacked in due season and proper, mode, was an obiter dictum, as was also the suggestion, that an undertaking in $300 is sufficient in appealing from a judgment and from an order other than one made on motion for a new trial. We think it impossible that appellant could have been induced or misled by anything said in the Morse Case into the omission to file the undertaking demanded by the express and plain language of the law, or that she could have been influenced thereby, or that she may justly complain of the present decision as working a supposed retrospective change in appellate practice to her detriment. The statutory provisions regulating the manner of taking and perfecting appeals must be strictly pursued.

The appeals are dismissed.

Dismissed.

Brantly, C. J., and Hunt, J., concur.


author: BRANTLY, C. J.

text:
    SMITH, Respondent v. CALDWELL, Appellant.
    [No. 1054.]
    [Submitted March 3, 1899.
    Decided March 27, 1899.]

      Execution — Sheriff's Sale — Estoppel of Owners — Attorneys — Confidential Communications.

    1. The silence of the owner of property, after a wrongful seizure of it as the property of another, where not in any way inducing the seizure or sale by the sheriff, or otherwise deceiving him, or done with intention to mislead or deceive him, does not estop the owner from suing the sheriff for the value of the property.
    2. Any communication made to any attorney by a client seeking advice from him, either upon payment of compensation, or without it, touching the matter with reference to which the advice is sought, is privilged.
    3. Information incidentally obtained by one while acting merely as a scrivener in drawing up a deed, though he is also an attorney, where advice had not been asked of him and he gave none, is not privileged.

      Appeal from District Court, Gallatin County; Frank Henry, Judge.

    Action by Fred W. Smith against White Caldwell. From a judgment for plaintiff, and from an order denying a new trial, defendant appeals.
    Reversed.
    Statement of the case by the Justice delivering the opinion.

      Action for damages for a conversion of personal property. On May 7, 1895, one Horace T. Kelly was the owner of certain mares (four in number); of an undivided two-thirds interest in growing crops of barley, wheat and oats upon sections 24, 25, 26 and 36, all in township 3 S. of range 4 E., amounting to about 200 acres; and of an undivided one-half interest in the crops of the same description growing upon section 19 in township 3 S. of range 5 E., — all situate in Gallatin county, Montana. By bill of sale executed and delivered on that date, he sold this property to one Robert Almich for the sum of <f>2,000, and took his negotiable promissory note therefor, payable on October 1st thereafter, with interest at 1 per cent, per month until maturity, and l-J per cent, thereafter until payment. On June 10th following, the said Almich, to secure the payment of this note, executed and delivered to the said Kelly a chattel mortgage upon all the property so purchased by him, which was properly acknowledged and filed for record on the next day with the clerk of Gallatin county. At the time of these transactions both Kelly and Almich were living upon the land auove described, in separate houses, at a distance of four feet apart. On the 27th of the preceding March, Almich had leased from Kelly the lands above described, in sections 25, 26 and 36, by a written lease, under the terms of which Kelly was to do the plowing, furnish feed, the teams necessary to put in crop, and what machinery he had; to pay one-third of the twine bill and two-thirds of the threshing bill; and to dictate when seeding, irrigating, harvesting and threshing was to be done, and where the threshing was to be done. Almich was to bear all expenses of crop, including repairs, to perform all labor necessary to mature and thresh the crop, to stack the straw in good shape and to furnish all machinery belonging to him. Kelly's share of the crop was to be two-thirds of the product in granary or in sacks, at his option. On the 23d of the preceding April, Kelly had leased to one John H. Watts the land above described, in section 19, to be worked by Watts for that season under somewhat similar conditions to those in the Almich lease. Kelly’s share of the crop to be raised by Watts was one-half. The shares under these leases were the growing crops involved in the transactions between Kelly and Almich. After the sale and mortgage were made, Kelly and Almich continued to live and work upon the crop as before; Kelly carrying out his agreements under the leases to Watts and Almich. Kelly was indebted to various parties and, among others, to the plaintiff herein and John H. Black. On August 20th Kelly sold the Almich note to the plaintiff herein for the sum of §1,380. This sum was paid by Smith by the assumption on his part of indebtedness of Kelly to the amount of §422.50, the cancellation of §7.50 due himself from Kelly, a credit of §800 upon another note held by Smith against Kelly, and a transfer to Kelly of §150 worth of cattle. At this time the crops were partially harvested, but no part of them threshed:
    On August 2 2d, John H. Black brought suit against Kelly in the District Court of the Ninth Judicial District, at Bozeman, in Gallatin county, to collect the debt due from Kelly to him, and caused an attachment to issue. Under this attachment the defendant herein, as sheriff, seized the crops and two of the mares mentioned in the mortgage, as the property of Kelly. Afterwards, on September 20th, Black recovered judgment against Kelly for the sum of §2,557.20, with costs. On October 7th thereafter, all the property was sold under execution to satisfy this judgment. On August 27th, after the levy of the attachment by defendant, Almich made his affidavit of claim to the property, and served it upon defendant, but defendant refused to release it. The plaintiff made no demand for the release of the property, but after the sale demanded of the defendant, in writing, the payment of the Almich note, with interest.
    Defendant in his answer attacks the transaction between Almich and Kelly on the alleged ground that it was fraudulently designed to hinder and delay the creditors of Kelly. He also alleges that the plaintiff purchased the Almich note, with full knowledge of its fraudulent character, to aid the plans of Amich and Kelly. His failure to notify the defendant that he was the assignee of the Almich note until after the sale of the mortgaged property, though he knew of the levy, it is claimed, estops him from insisting that he has been damaged.
    The cause was submitted to a jury. Plaintiff recovered a verdict and judgment for $1,953.23, with costs. From this judgment, and an order overruling his motion for a new trial, defendant appeals.

      Luce & Luce, for Appellant.
    Instructions 21 and 22, refused by the court, were asked to present to the jury the question of estoppel and no instruction whatever on this proposition was given. The facts conclusively show that Smith did not make his interest known to the defendant at any time until after the property had been sold under execution and then only made a demand for the value of the note and never for the return of the property or its value. Smith knew of the attachment and- was served with garnishment. He had been expecting the sheriff. The allegation in the answer that Smith had notice of the writ of attachment and the seizure of the property thereunder is not denied. The demand upon the sheriff was made after the money realized from the sale under execution had been applied upon the judgment against Kelly. His conduct clearly estopped him. (Beach on Modern Equity Jurisprudence, Sec. 1106; Chapman v. Chapman, 59 Pa. St. 214; Holier v. Wassweiler, 19 Mont. 169; Rice on Evidence, Yol. 2, 724). The original seizure was in no way a conversion. The interest mortgaged in the Almich mortgage was an undivided two-thirds and the sheriff was obliged to seize the whole of the crop.
    It is the duty of the sheriff when he holds an attachment against the owner of an undivided share of chattel property to seize the whole of the property. (Murfree on Sheriffs, Sec. 267, and cases cited; Veach v. Adams, 51 Cal. 609, and citations). It has been held that a mortgagee of' personal property, not in possession, who is present at a sale of such property by the mortgagor to another, and such mortgagee on being asked to fix the price between the mortgagor and purchaser, does not notify the purchaser of his mortgage and the property is afterwards delivered to the purchaser, the mortgagee cannot recover the property as against such purchaser without notice. (Herman Estoppel and lies Adjudicata, Secs. 929 and 735; Brooks v. Record, 47 111. 30; Lloyd v. Lee, 45 111. 277; Kane Go. v. Herrington, 50 111. 232; Edgerton v. Thomas, 9 N. Y. 40). The mortgage from Almich to Kelly, being fraudulent, the property was subject to attachment as Kelly’s and the sheriff could justify under the attachment. (Munns v. Loveland, 49 Pac. 743 Opin. 745, (a case very much like this); Tisher et al. v. KelVy, 46 Pac. 146, a strong case). If it was proper to submit the alleged fraud to the jury so also should the court have submitted the question of estoppel. See also upon the question of estoppel Stewart v. Hovey, 26 Pac. 683 Opin. on rehearing p. 685.

      Holloway & Hoffman, for Respondent.
    We insist that the record shows (Record 136-138) that the testimony proposed to be elicited, was the substance of a conversation had by Kelly and Almich with the witness Stevenson, and in the capacity of an attorney, and that whatever knowledge he got, he acquired by reason of his relationship as such attorney.
    Stevenson says (Record 137, line 17): “I will state to the court that whatever 'knowledge I acquired, I certainly acquired acting in the capacity of an attorney for ¡¡he parties to the mortgagee.”
    In an action between Kelly and Almich, the communication would not be privileged; but as between either of them and any third party, or as between third parties, as in the case at bar, the communication is privileged. (Britton v. Lorenz, 45 N. Y. 56). And the communication is privileged under all circumstances unless waived by the client, and such waiver must be distinct and unconditional. (19 Am. and Eng. Ency. Law, p. 133; Guber v. Baker, 23 Pac. 858).
   BRANTLY, C. J.

1. Appellant earnestly contends that the evidence is not sufficient to sustain the verdict, and that the court below should have granted a new trial on this ground. As the case must be reversed and a new trial ordered on other grounds, we shall not review the evidence. Upon another trial it may present different aspects, and any suggestion by us in this regard might tend to prejudice the rights of the parties.

2. The defendant in his answer alleges that, from the date of the seizure of the property in controversy until the sale thereof under the execution to satisfy the judgment in the cause of Black against Kelly, the plaintiff had actual knowledge that the property had been seized, but that he allowed it to be sold, and the proceeds to be applied upon the judgment, without giving defendant any notice, or making any claim for it. It is insisted that, by this knowledge and silence on his part, plaintiff is estopped to maintain chis suit for its value.

The court below was requested to instruct the jury that, if they found these facts from the proof, they should find a verdict for defendant. The court refused the instruction. This refusal of -the court to so instruct the jury is assigned as error. The court was right. The facts stated in the answer are not sufficient to constitute a defense by way of estoppel. There is no averment that the plaintiff’s silence in any way induced the defendant to seize or sell the property in controversy. Nor is there any other fact stated which shows that the defendant was in any way deceived or misled by the plaintiff, or that the silence of the plaintiff was designed or intended by him to mislead the defendant.' (Sweetman v. Ramsey, 22 Mont. 323, 56 Pac. 361, and authorities cited; Barnhart v. Fulkerth, 93 Cal. 497, 29 Pac. 50; Bowman v. Cudworth, 31 Cal. 148; 2 Pom. Eq. Jur. Sec. 812; Rice, Ev. pp. 716-719.) Besides, if the defendant wrongfully seized property belonging to plaintiff, and appropriated it to the satisfaction of Black’s claim, he was a trespasser ab initio, and does not stand in the attitude of an innocent party who has incurred a liability or acquired a right through any inducement held out by the plaintiff, or the silence of plaintiff when the duty rested upon him to speak. The defendant acquired no right by any act done by him in the case of Black against Kelly, nor did he incur any liability which he would not have incurred but for his own wrong. The silence of plaintiff after the wrongful seizure forfeited none of his rights, nor did it any way remedy the original wrong. (2 Pom. Eq. Jur. Sec. 812; Schilling v. Black (Kan. Sup.) 81 Pac. 143; Donnell v. Reese (Kan. App.) 51 Pac. 584.)

3. During the trial the defendant offered W. J. Stephenson as his witness. Stephenson had drawn the mortgage from Almich to Kelly, both having gone to him to secure- his services for this purpose. He objected to testifying on the ground that what he learned about the transaction at that time was by virtue of his relation ■ to those parties, as- their attorney. The testimony sought to be obtained from him, as appears from the offer to prove made by counsel, was a statement made by Kelly, in the presence of Almich, that the mortgage was being made for the purpose of defrauding Black, and to hinder and delay Kelly’s other creditors, or words of like import. The witness was examined as to the relation he at that time sustained to Almich and Kelly. It appeared that Stephenson is an attorney at law, and was at that time a justice of the peace and notary public. Almich and Kelly came to him to draw the mortgage, bringing with them a memorandum of what was to be embraced in it, and. a description of the premises upon which the property was situated. Stephenson had a conversation with them about the matter, and thereupon drew the mortgage. So far as the record reveals what took place, they asked no 'advice of Stephenson, nor did he give them any. They had already determined upon what they would do before they sought his services. He did not advise them what to do, or how to do it. He charged them for what he did. Plaintiff waived his objection to the proof, but the court excluded it. Defendant excepted to this ruling of the court, and assigns it as error. “An attorney cannot, without the consent of his client, be examined as to any communication made by the client to him, or his advice given thereon in the course of professional employment.” (Code of Civil Procedure, Sec. 3163, Subd. 2.) It has been held by this Court (Davis v. Morgan, 19 Mont. 141, 47 Pac. 793) that this rule applies where one seeks advice upon communications made to an attorney, as such, even though- the advice sought is for the purpose of aiding the client to evade his creditors. The test here applied to determine whether the relation of attorney and client existed is whether advice was sought from the attorney professionally, either upon payment of compensation, or without' it. Any. comm unication made under such circumstances touching the matter with reference to which the advice is sought is privileged. ‘ ‘Knowledge acquired during the time the relation exists is not privileged unless it is acquired in the course and for the purpose of his (the attorney’s) employment.” (Satterlee v. Bliss, 36 Cal. 489.) The party seeking to suppress the evidence must sustain the burden of showing that it comes within the rule. (Carroll v. Sprague, 59 Cal. 655.) “And it must 'appear that the witness learned the matter only as counsel or attorney or solicitor for the party, and not in any other way, and that it was received professionally and in the course of business.” (Sharon v. Sharon, 79 Cal. 633, 22 Pac. 26, 3 31.) The communication must be confidential, and so regarded, at least by the client, at the time. (Id.) See, also, Gallagher v. Williamson, 23 Cal. 332; Hatton v. Robinson, 14 Pick. 416, s. c. 25 Am. Dec. 415; Hebbard v. Haughian, 70 N. Y. 54; Caldwell v. Davis, 10 Colo. 481, 35 Pac. 696; Mutual Life Insurance Co. v. Corey, 54 Hun. 493, 7 N. Y. Supp. 939; Todd v. Munson, 53 Conn. 579, 4 Atl. 99; De Wolf v. Strader, 26 Ill. 225; Smith v. Long, 106 Ill. 485; Borum v. Fouts, 15 Ind: 50. From the' examination' of the witness Stephenson, as shown by the record, it appears that he acted in the transaction about which he was asked, not as counsel to whom Almich and Kelly went to obtain advice, but as a scrivener only. What he learned seems to have been a'mere incident to the ministerial ■office of writing the instrument,- and -the notarial work' of authentication for record. Information obtained in this way is not privileged, even though the scrivener be an attorney at law. , (See authorities cited supra.) -It is commendable in an attorney to guard carefully the-confidences of his clients,- — ■ nay, it is his solemn duty to do so; but he.must also hold himself ready to take up his duties, to others at the point where his duty to his client ends, and give them the benefit, when the necessity arises for it, of the facts within his knowledge. We think, upon the record as it appears before us, the court erred in not requiring him to answer. For this error a new trial must be granted, because it is impossible to tell how a jury might view the case with this evidence before them.

4. Several' other errors are assigned, but of these we shall note only one. Defendant makes the contention that there was no evidence before the jury on the question of damages which warranted the court in submitting the ease to them at all. This contention is not supported by the record. There was ample evidence from which the jury could determine the value of the property at the time it was seized, or at anytime up to the rendition of the verdict. The court properly instructed the jury as to the measure of damages, under Section 4333 of the Civil Code, — that, if they found for the plaintiff, they should fix the amount found at the highest market value of the property at any time between the date of the conversion and the verdict. There was no request for any more specific instructions on this subject, but we would suggest that the jury should have been told that from the gross value there should have been deducted the cost of finishing the harvesting, and the threshing bill paid by defendant.

Let the judgment and order be reversed, and the cause remanded, with directions to grant a new trial.

Reversed and remanded.

Hunt and Pigott, JJ., concur.


text:
    MENARD, Appellant v. MONTANA CENTRAL RAILWAY CO., Respondent.
    [No. 1,020]

    [Submitted January 20, 1899.
    Decided March 27, 1899.]

      Appeal — Order Granting New Trial — Record — Review— Railroads — Killing Stock — Evidence— Complaint— Corpor ations— Constitutional Law.

    1. The opinion of the lower court, though inserted in the record on appeal, cannot be resorted to. to add to the order sought to be reviewed, as the Code of Civil Procedure of 1895 does not require the opinion to he made part of the transcript.
    2. Though a motion for a new trial, made for errors in law, is granted solely on the ground that plaintiff’s cause of action is barred by limitations, the appellate court may consider other errors specified; and, if it appears from the whole record that the motion was properly granted, the order will be affirmed, though the reason given was wrong.

      Obiter. — It in the order granting a new trial the District Court explicitly excludes the ground that an abuse of discretion has been committed, or that the evidence is insufficient, or both, these grounds will not be considered on appeal, and the order will not be affirmed, unless it affirmatively appear from the record that the order should have been granted.
    3. In an action against a railroad company for the killing of stock, evidence that the animals were found dead or dying near the track, and that the company’s employes, as part of their regular duty, skinned the animals, does not warrant the direction of a verdict for plaintiff.
    4. Civil Code, Section 400, provided that any domestic corporation existing when the Code took effect might elect, in a manner provided, to continue its existence under the provisions thereof. Section 401 provided that no corporations then existing should be affected by Part 4 of Division i of the Code, unless they should electas above, but that the laws under which sucli corporations were formed and existed should be applicable thereto, and were repealed, subject to the provisions of the section. Sections 950 and 951 require railroad companies to fence their tracks and property, and make them liable for stock killed in default of such fence, or through their negligence. Held, that a domestic railroad company formed before the Code took effect, and which had not made an election as provided, was not subject to the last two sections.
    5. Civil Code, Section 401, making corporations formed before the act took effect subject to laws then existing, and corporations formed thereafter subject to the Code, is constitutional.
    6. Under Lav s 1891, p. 267, providing that any railroad which fails to fence its track shall be liable for stock killed by reason of the want of such fence, and that, in order to recover, it shall be necessary to prove only the injury and damage, a comp aint must state that the animals were killed by reason of the want of a fence.
    7. It is improper to insert the undertaking on appeal in the transcript.

      Appeal from District Court, Lewis arid Clarke County/ Henry N. Blake, Judge.

      Action by Edward Menard against the Montana - Central Railway Company. • A verdict was directed for plaintiff, and judgment entered thereon, and from an order granting a new trial plaintiff appeals.
    Affirmed.

      I J. Walsh, for Appellant.
    Citing: Constitution, Art. XY, Secs. 1, 3, 8; Hays v. Com., 82 Pa. St. 524; DeMoss v. Newton, 31 Ind. 219; Price v. Hopkins, 13 Mich. 318; McGahey v. Virginia, 135 U. S. 662; Pereles v. Watertown, 6 Biss. ,79; Civil Code, Sec. 950 et seq; Cooley on Const. Lim. 483 et seq; Bates v. Fremont Co., 57 N. W. 72; Hindman v. Navigation Co., 22 Pac. 116; Atchison v. Shaft, 6 Pac. 908; State ex rel. v. Mayor, 19 Mont. 518; Hook v. Hall, 6 Pac. 422; Heilbron v. Center-ville, 76 Cal. 8; Wheeler v. Kassabaum, 76 Cal. 90; Bode v. Bee, 102 Cal. 583; Goodnow v. Parker, 112 Cal. 437; Taylor v. Hill, 115 Cal. 143; Spanagel v. Dellinger, 28 Cal. 278; Prison v. Brison, 27 Pac. 186; Scherrer v. Hale, 9 Mont. 63; City v. Albertose, 8 Mont. 499; Howland v. Oakland, 42 Pac. 983; Deither v. Lumber Co., 35 N. E. 843; Society v. Lackland, 3 Am. St. Rep. 298 and notes; Calvert v. B. B. Co., 34 Mo. 242, S. C. ,38 Mo. 467; Minter v. B. B. Co., 82 Mo. 128; IBurly v. Mo. Pac., 57 Mo. App. 676; Donegan v. Frhardt, 119 N. Y. 468; Market St. By. Co. v. Heilman, 109 Cal. 571; McGowan v. McDonald, 111 Cal. 57.

      A. J. Shores, for Respondent.
   PIGOTT, J.

This was an action to recover §250 as dam ages for the killing by defendant in 1895 and 1896 of three cows and one horse, the property of plaintiff. The complaint is in two counts, stated as two causes of action. In the first count the allegations are to the effect that the defendant, a domestic railway corporation, so negligently ran and- managed its trains that they ran over. the animals, which had casually strayed upon the track. The second cause of action is stated to consist of the matter alleged in the first, together with the further averments that the “defendant did not'make or maintain a good and sufficient, or any, fence on either side of its track; that the said cattle were killed by its engines and cars upon its line of road which passed through and along the property thereof; that §250 is the fair market price of the same; and that the killing occurred without the fault or negligence of plaintiff. ’ ’ Defendant, in its answer, admitted its corporate character, but denied the other allegations of the complaint, and pleaded the bar of the statute of limitations. At the trial the evidence tended to prove that all the animals were killed on defendant’s track, and by its engines, and that defendant did not maintain a fence at the point where' the killings took place. Two of the animals were killed in 1895, and two in 1896. As to those killed in 1895, valued at §185, the testimony showed that they were found dead or dying near the track, and that the employes of defendant, acting under its instructions, and as part of their regular duty, skinned the animals, and took the hides to the nearest station. As to the cows killed in 1896, there was testimony given by plaintiff that the trains which killed them made no stop, paid no attention to them, and that the whistle was not blown, although the animals could have been seen by those on the engine for the distance of a mile, at least, before they were struck. It was shown that defendant became a corporation in 1886, under the provisions of the statutes then in force, and since has been such corporation. Defendant offered no evidence. On plaintiff’s motion, the court peremptorily, directed the jury to find for plaintiff in the sum of §250, the value of the animals; defendant excepting. A verdict having been returned in accordance with the instruction of the court, defendant moved for a new trial for errors in law, which was granted, and from that order plaintiff appeals.

1. It is earnestly asserted by the plaintiff that the District Court granted the motion for a new trial upon the sole ground’ that the statute of limitations barred recovery for the animals killed in 1895, and that, therefore, this Court is restricted to an examination of the soundness of the reason given for mak ing .the order. But the premise upon which the contention rests is unsound. The record proper does not disclose that the order was made for the reason stated by plaintiff. The motion was made upon the ground of errors in law committed at the trial, and excepted to by defendant. The order nisi for a new trial is that “the motion for anew trial be granted, unless the plaintiff' shall within ten days * * * consent to release all of said verdict excepting the sum of §65, and that, upon the filing of .such consent in writing by the plaintiff, said motion be overruled, and the judgment hereinbefore entered be modified accordingly;” and the order appealed from, after reciting that plaintiff declined to release any part of the verdict and judgment, merely sustains the motion for a new trial. In making the conditional order, the court delivered an .opinion, — a copy of which is in the transcript, — to the effect that the bar of the statute intervened .as to the animals killed in 1895; but, however great an assistance it might be to this Court, the opinion is not part of the record, and cannot be resorted to for the purpose of adding to the order •sought to be reviewed. Under Section 438 of the First Division of the Compiled. Statutes of 1887, such an opinion, when filed, was required to be made.part of the transcript, to aid the court in the. determination of the issues (Fant v. Tandy, 7 Mont. 443, 17 Fac. 560), but we can find no such provision in the Code of Civil Procedure of 1895. Conceding, however, that the premise is true, and that the record shows the new trial to have been granted upon the sole ground — now abandoned by defendant — that the right to recover for the cattle killed in 1895 was barred by the statute, the conclusion drawn therefrom .by plaintiff is unwarranted; for, this Court must examine into all the errors of law specified, and, if it appear from the whole record that the new trial was not improperly granted, the order will be affirmed. The true rule, with the reasons underlying it, may, we think, be thus stated: The losing party has the right to ask for a new trial upon any one or.more of the grounds recognized by the statute; it is the duty of .the court to grant a new trial whenever it. shall appear that statutory grounds exist therefor; the statement or bill of exceptions resembles, in its nature, a complaint, and this is attacked by the specifications very much as the complaint is assailed by a demurrer. If, for example, the demurrer be for insufficiency, for defect of necessary parties, and for want of jurisdiction over the subject-matter, and the court sustains it upon the single ground that there is a defect of parties, and judgment is thereupon entered for defendant, whereas the complaint is bad for either or both of the other reasons, but is not obnoxious to the objection upon which the court based its decision, this Court would nevertheless affirm the judgment.

A wrong reason for a decision' does not invalidate it, - — the result may be right, though the reason given for making it be wrong. So with the order granting a new trial. The specific or particular reason given for making it is usually unimportant; — m illustration: A new trial may be granted for supposed error in an instruction, and for that reason alone; if the instruction be correct, but prejudicial error was committed in the admission or the rejection of evidence, or in any other particular within the grounds assigned for the motion, and specified in the statement or bill, the party aggrieved will be entitled to a trial de novo, notwithstanding the reason by which the right result was reached was wrong. Were the rule otherwise, miscarriages of justice would frequently occur. The moving party may be entitled to a new trial, which the court grants for the wrong reason; he cannot maintain an appeal from- the order made at his instance; the judgment is canceled, or at least suspended, while the order remains in force, and he cannot appeal from it: therefore, if the order granting a new trial be reversed by the Supreme Court, the party aggrieved by the verdict and entitled to a new trial would be without redress. The rule ought to be limited to this extent: • If in the order granting a new trial the District Court explicitly excludes the ground that an abuse of discretion has- been committed,- or that the evidence is insufficient, and the record fails, to establish affirmatively a clear abuse to the moving party’s prejudice in the one case, or shows-a substantial conflict in the other, then this Court should not affirm the order, unless it may be justified on other grounds. "W here there are several specifications in support of an appli•cation for a new trial, and among these is included an alleged .abuse of discretion, or the insufficiency of the evidence, or both, and in granting the motion the court expressly excludes the particular ground or grounds just mentioned, this Court •will not*consider it or them, unless it appear that the duty was incumbent upon the District Court to grant a new trial "therefor. If the grounds so excluded refer to mere matter of discretion, among which may be reckoned the determination of the question of the preponderance of conflicting evidence, whether received at the trial, or in support of the motion for a new trial, as well as numerous questions of mixed law and fact, the order granting a retrial will not be affirmed, .although the court below would not have erred in granting a new trial therefor, unless some other ground would justify the order. This rule, in part, is delared -in Kauffman v. Maier, 94 Cal. 269, 29 Pac; 481.

2. Since the submission of the appeal, defendant has abandoned the point that the statute bars the remedy for the killing of the cattle in 1895. The only error specified in the statement on motion for a new trial, and relied upon here to support the order appealed from, is the peremptory instruction to find for the plaintiff in a sum equal to the value of all the animals. It is conceded that the testimony given by plaintiff tended to establish that the actual negligence óf the defendant was the proximate cause of the death of the cows killed in 1896, and defendant admits the right of the court to direct the jury to return a verdict for their value upon his testimony alone. By this admission we are relieved of the necessity of deciding whether the evidence of a party directly interested is, as a matter of law, to be deemed conclusive proof.

3. The only question, then, is whether the court erred in directing a verdict for the value of the animals killed in 1895. With respect to these, there was -not sufficient evidence to establish so clearly the liability upon common-law principles.as to warrant the direction of a verdict, — we do not, however, intimate that there was enough to go to the jury on the issue of negligence; but plaintiff sought also to recover upon the theory that defendant is .liable under Sections 950 and 951, which are part of Chapter III of Title VIII, Part IV, Division I of the Civil Code. Section 950 requires railroad corporations to make and maintain a good and sufficient fence" on either or both sides of their track and property, in default whereof, if their engines or cars shall kill or maim any domestic animals upon their line of road which passes .through or along their property, they must pay to the owner a fair market price for the cattle killed or maimed, unless it occurred through the negr lect or fault of the owner. .Section 951 declares that every railroad corporation which negligently injures or kills any domestic animal by running an engine or car over it shall be liable to the owner for the damages .sustained by him, and that the killing or injury shall be prima jacie evidence of negligence on the part of the company. If either of these sections is applicable to defendant, the instruction, was correct, and the new trial was erroneously granted.

Defendant invokes the provisions of Sections 400 and 401 of the Civil:Code. They read as follows:

“Sec. 400. Any corporation formed under the laws of the territory or state of Montana, except those dissolved by the provisions of .Section 393, and still existing, may at any time within the period limited for its duration elect to continue its existence under the provisions of this.Code applicable thereto. Such election may be made at any annual.meeting of the stockholders,; or members, .or at any meeting called by the directors expressly for considering the subject, if voted by stockholders representing, a majority of the capital stock, or.by a majority of the members, or may be made by the directors upon the written consent of that number of such stockholders or members. A certificate of the action of the directors, signed by them and their secretary, when the election is made by [heir unanimous vote, or upon the written consent of the stockholders or members,, or a certificate of the proceedings of the stockholders or members, when such election is made at any such meeting, signed by the chairman and secretary of the meeting, and a majority of the directors, must be filed in the office of the clerk of the county where the original articles of incorporation aré filed, and a certified copy thereof must be filed in the office of the Secretary of State; and thereafter the corporation shall continue its existence under the provisions of this Code which are applicable thereto, and shall possess all the rights and powers,- and be subject to all the obligations, restrictions and limitations prescribed thereby.
“Sec. 401. No corporation formed or existing before 12 o’clock noon upon the day which this Code takes effect, is affected by the provisions of. Part IV of Division First,-of this Code, unless such corporation elects to continue its existence under it as provided in Section 400; but the laws under which such corporations are formed and exist are applicable to all such corporations, and are repealed, subject to the provisions of this section. ”

Defendant maintains that since it is a corporation formed in 1886 under the laws of Montana, and was existing as such before 12 o’clock noon of July 1, 1895, when the Civil Code took effect, it is not subject to the operation of Sections 950 or 951, there being nothing to show that it has elected to continue its existence under the provisions of the Code. Plaintiff contends that Section 401 simply preserves to nonelecting corporations in existence at the time, the Code went into effect such laws as relate to the formation, existence and powers of such corporations, and that in all other respects the Code provisions control. We are of the opinion tha-t defendant’s position is correct. -The question here involved • was fairly presented, and squarely met - and decided, in Murphy v. Pacific Bank, 119 Cal. 334, 51 Pac. 317; The court, in that case, having before it for consideration the interpretation of two sections, one being. identical with Section 401,' supra, and the other similar to Section -400,- supra, said; “It will be observed that as to corporations existing at the time the Code took effect, and which elect to continue their existence- under it, ‘the provisions of the Code which are applicable thereto’ govern them, and that they ‘possess all the rights and powers,’ and are ‘subject to all the obligations, restrictions and limitations prescribed thereby;’ and that corporations which do not so elect are not ‘affected by the provisions of Part IV of Division 1, * * * but the laws under which such corporations were formed and exist are applicable to all such corporations.’ The distinction here made between those corporations which should elect to come under the code provisions and those that did not is clearly manifest. If no such distinction was intended, it would have been quité sufficient to say that no corporation shall cease to exist because of the adoption of the Code, but thereaiter all corporations existing at the time the Code takes effect shall be governed by its provisions alone; and there would have been in that case no necessity or propriety for an election on the part of the corporation to come under its provisions.”

When carefully read in connection with other sections of the Code, the design of Section 401 is reasonably clear. If the will of the Legislature was to make the provisions of Part IV of Division 1 applicable to nonelecting corporations formed and in life when the Code became operative, its design would probably find expression in some language such as this: ‘ ‘Every corporation hitherto organized and now existing shall hereafter be subject to and governed by the provisions of Part IV of Division 1 of the Civil Code, and all statutes in force immediately prior to the taking effect of this Code which concern or relate to corporations are repealed; but such repeal shall not affect the formation or existence of corporations heretofore formed and now existing.” The first clause of Section 401 declares that no corporation formed or existing before noon of July 1, 1895, is affected by the provisions of Part IV of Division 1, unless the corporation elects to continue its existence under' the Code in the manner prescribed in Section 400: This is sufficiently broad' to exempt corporations .existing at the time the Code went into effect from its provisions. The latter clause provides, in substance, that the laws under which such corporations are formed and exist are applicable to them only, being repealed as to all other corporations. Provisions other than those relative to their formation and existence are comprehended by the expression, “the laws under which such corporations are formed and exist;” and all these were intended to remain in respect of such existing corporations, and were repealed, subject to the provision in the first clause that no existing domestic corporation shall be affected .by the provisions of Part IV of Division 1. The provision just spoken of does not declare that no existing corporation shall be affected by those provisions of Part IV relating to the formation and existence only of corporations. The purpose of Section 401 was not to prevent the annihilation or dissolution of existing corporations, for Section 400 recognizes existing corporations, and. their right to continue without availing themselves of the privilege of election thereunder; moreover, all prior vested rights in general are carefully preserved by Sections 4651, 4654 and 4672 of the Civil Code. Were the meaning of Section 401 obscure, reference to Section 400 would .serve to interpret it; for the latter section provides that, after filing the certificates required thereby, “the corporation shall continue its existence under the provisions of this Code which are applicable thereto, and shall possess all the rights and powers and be subject to all the obligations, restrictions and limitations prescribed thereby.” In.Title I, Part IV, Division 1, are sections referring, respectively, to ‘ ‘corporations heretofore formed, ” to ‘ ‘corporations that may be hereafter formed,” and to “corporations” or ‘ ‘all corporations. ’ ’ If all existing corporations were intended to be affected by the provisions of Part IV. of Division 1 of the Civil Code of 1895, other than those relating to their formation and existence, to make , mention of or to distinguish between corporations existing before the Code and those organized under it would seem unnecessary. We think that Section 401, as amended by the act approved March 5, 1897, (Laws' 1897, p. 231) correctly interprets that section as originally passed.

It may be - undesirable or inconvenient that corporations formed before July 1, 1895, should be governed by statutes differing from those applicable to corporations of the same kind organized thereafter; but any suggestion that such distinction is repugnant to the constitution is without merit. The point was necessarily involved in Home Building & Loan Association v. Nolan, Attorney General, 21 Mont. 205, 53 Pac. 738, and held untenable.

Neither Section 950 nor Section 951 applies to defendant, and, in directing the jury to find for plaintiff as to the value of the aniimals killed in 1895, the court erred, unless the plaintiff has brought his case within the terms of some other provision of statutory law.

4. Plaintiff insists that he was entitled to recover under the act of March 2, 1891, entitled“An act requiring railroad companies to pay for damages to stock” (Laws 1891, p. 267). So much of the act as is relevant provides that any corporation operating a railroad in Montana ‘ ‘that fails to fence the same by fence suitable and amply sufficient to prevent cattle, horses, sheep and other live stock from getting on said railroad, at all points where such right to fence exists, shall be liable to the owner of any such'stock injured or killed by reason of the want of such fence for the value of the property or damages caused, unless the same was occasioned by the willful act of the owner, or his agent. And in order to recover it shall only be necessary for the owner to prove the injury or destruction of his property and the value thereof. * * *”

We are of the opinion that the complaint, for failure to state that the animals were killed by reason of the want of a fence at points where the right to fence existed, is insufficient to sustain a recovery under the act of 1891, assuming it to have been in force as to defendant. True, the act delares that in order to recover it shall-only be necessary for the owner to prove the killing of the animals, and their value; but this lays down a mere rule in respect of the amount- ■ of evidence or quantum of proof, which- in no wise aids the complaint, — the rule has the effect only of dispensing with the necessity of making some -proofs, which, in' the absence of the rule, might be deemed indispensable to a recovery, and does not supply the omission of the complaint to charge facts constituting a cause of action created by, and arising from the provisions of, the statute. In actions brought under the act of 1891, the complaint must allege, and it seems the evidence should show, that the cattle were killed by reason of the want of such a fence as the statute requires at points where -the corporation had the right to fence. (Schmidt v. Railway Co., 99 Iowa, 425, 68 N. W. 715; Wall v. Railway Co., 89 Iowa, 193, 56 N. W. 436; Manwell v. Railway Co., 80 Iowa, 662, 45 N. W. 568; Comstock v. Railroad Co., 32 Iowa, 376; Rowland v. Railway Co., 73 Mo. 619.) That part of the act of 1891 quoted is, with but slight change in phraseology, identical with a provision of Section 1289 of the Iowa Code, and seems to have been adopted therefrom. The Supreme Court of Iowa, in the cases cited, interprets the provision and announces the law as here stated.

In McCauley v. Railway Co., 11 Mont. 483, 28 Pac. 729, the facts and the statute upon which the decision was made were so different from those presented on • this appeal as to make the case not in point.

The complaint does not present a case within the terms of the act of 1891, nor was it drafted upon the theory that said act applied. In directing a verdict, the court mistakenly assumed that the plaintiff was entitled to recover for the animals killed in 1895, upon the ground that he had established defendant’s liability under Sections 950 and 951 of the Civil Code. As to the right to recover for the animals last mentioned, there is nothing in the complaint justifying the instruction. The court therefore misdirected the jury to defendant’s prejudice, and did not err in setting aside the verdict and granting a new trial.

We note that a copy of the undertaking on appeal is improperly inserted in the transcript. It is not one of the paper? required to be sent up. (Murray v. Hauser, 21 Mont. 120, 53 Pac. 99.)

Let the order granting a new trial be affirmed.

Affirmed.

Brantly, C. J., and Hunt, J., concur.


author: PER CURIAM.

text:
    STATE, Plaintiff, v. MONTANA ORE PURCHASING CO. et al., Defendants.
    [No. 1,368.]
    [Filed March 27, 1899.]

      Recital of Contempt Proceedings.

      Wm. II. De Witt, Forbis <& Evans and Ransom Cooper, for Plaintiff.

      McHatton d? Cotter, R. B. Smith and Cullen, Day <& Cullen, for Defendants.
   PER CURIAM.

On March 2, 1899, an order of injunction was issued by this Court in a cause pending herein on appeal from the District Court of the Second Judicial District, entitled “Boston & Montana Consolidated Copper & Silver Mining Company, a Corporation, v. Montana Ore Purchasing-Company, Chile Gold Mining Company, and Johnstown Mining Company, Corporations,” to restrain these defendants, pending the appeal, from mining and extracting any ores from certain parts of the Pennsylvania lode claim, situate in Silver Bow county, Montana. This order was served upon the said defendants and their officers and foremen on the same day. It. was made under the provisions of Section 23, Code of Civil Procedure, and Rule XVI of this Court. On March 6th. thereafter it was made to appear to this Court by the affidavits of L. O. Evans, Esq., one of the attorneys for the plaintiff in said action, and Lee Hayes, the civil engineer of plaintiff, that on March 4th, notwithstanding the order so issued by this Court, the said defendants, with a large force of men, were engaged in mining and extracting ores and removing them from the said mining ground. Thereupon this Court issued an order, directed to the defendants, and to F. Augustus Heinze, Carlos Warfield and E. L. Whitmore, defendants’ agents, to be and appear before this Court on March 8, 1899, to show cause why they should not be attached and punished for failing and refusing to obey the said order. On March 8th all these parties appeared, except F. Augustus Heinze, who was at that time ill. All filed affidavits denying any violation of the order of March 2d. Thereupon proof was heard by the Court. After argument of counsel, the matter was submitted; and after consideration of the proof, on March 9th, the Court was of the opinion that the defendant Montana Ore Purchasing Company, and Arthur P. Heinze, its secretary, who answered in his own behalf and also for the company, were guilty of disobedience of the order, and fixed their punishment at a fine of §500 for the defendant corporation, and §250 for A. P. Heinze, and committed the said A. P. Heinze to the jail of Lewis and Clarke county until these fines should be paid. It was also ordered that A. P. Heinze and John MacGinniss, and all the officers of the Montana Ore Purchasing Company, except F. Augustus Heinze, its president, be committed to the jail of Lewis and Clarke county until they should satisfy the Court that the said company had compli d with the order of March 2d. The Johnstown Mining Company, the Chile Gold Mining Company, Carlos Warfield and E. L. Whitmore were adjudged not guilty of contempt, and Avere discharged. Thereafter, upon the same day, it being-made to appear to the Court that the fines so imposed upon the Montana Ore Purchasing Con pany and A. P. Heinze had been paid to the Clerk of this Court, and that the said company Avas obeying the order of Morch 2d, and gave assurance that it would continue to do so, it was adjudged that the said company and its officers aforesaid had purged themselves, and that they be discharged. The hearing of F. Augustas Heinze was continued until such time as he should be able to attend in person.

The clerk was ordered to pay the costs of this proceeding out of the moneys paid into his hands as aforesaid, and then cover the balance left in his hands into the state treasury.

Thereafter, on March 25th, F. Augustus Heinze having appeared before the Court in obedience to an order theretofore made, fixing his hearing for that day, proof was heard; and, upon consideration, the Court being of the opinion that sufficient punishment had already been imposed upon the Montana Ore Purchasing Company and its officers for the violation of the order complained of, and to secure future obedience thereto, it was so adjudged, and the said F. Augustus Heinze was ordered discharged.