author: Buvnton, J.

text:
    The State ex rel. H. P. Clough & Co. v. The Commissioners of Shelby County.
    1. Where an act of the legislature, or several acts in pari materia, have undergone revision, the same construction will prevail as before revision, unless the language of the new act plainly requires a change of construction, to conform to the manifest intent of the legislature.
    2. Section 799 of the revised statutes is a substantial re-enactment of section 10 of the act of April 27, 1809 (60 O. L. 52), and section 794 is a re-enactment of the first section of the act of May 5, 1877. (74 O. L108.) Hence, in so far as the • two sections are irreconcilable with each other, effect must be given to the latter.
    3. O., by sealed proposals, offered to supply the materials and perform the- “ cast and wrought-iron work ” which was to enter into the erection of a court-house-in Shelby county, for the sum of $33,900, and H. P. O. & Co. for $32,800; both sums being within the preliminary estimate of the architect. The commissioners awarded the contract to C., as the lowest and best bidder, and upon his failure to enter into the contract and execute the bond required by the statute, they refused to award the contract to II. P. C. & Co. as the nextlowest and best bidder, although demand was duly made therefor, and a good and sufficient bond tendered, but re-advertised for further proposals for supplying the materials and performing the work.

      Held, that a writ of mandamus will not be issued to compel the commissioners to award the contract to H. P. C. & Co.
    Application- for a peremptory writ of mandamus.

      W. J. Gilmore, for plaintiff.

      G. A. Marshall and JST. B, Buvress, for defendant.
   Buvnton, J.

This is an application for a peremptory writ of mandamus, an alternative writ having been allowed, commanding the defendants to accept the bid of the relators, and to award to them the contract for supplying the materials for, and completing the east and wrought-iron work which is to enter into the construction of a new court-house to be erected in Shelby county. It appeai-s from the petition of the relators that the defendants duly advertised for separate and distinct sealed jiroposals for furnishing materials and performing the labor for each separate and distinct trade, or kind of mechanical labor, or employment, necessary to fully complete the construction, and that among the specifications of the various kinds of material and labor for which distinct proposals were invited, was one for “ cast and wrought-iron work.” The architect’s estimate of the cost of the work was $34,600. Upon opening the bids, on the day named, which was November 9, 1880, it was found that the Columbus Bridge and Iron Works proposed to supply the materials and do the work for $23,900, and the relators for $32,800. These were the only bids for this branch of the work. The commissioners accepted the former bid, and entered on their journal an order awarding the contract to the Columbus Bridge and Iron Works as the lowest bidder, but as the company failed to enter into the contract and execute the required bond, the relators, on learning the fact, tendered a good and sufficient bond, and demanded of the commissioners the awarding of the contract to them as the next lowest bidder. This the commissioners refused to do, but re-advertised for further proposals for this specific class of work. To the writ containing a copy of the petition, which stated, among other things, the foregoing facts, the defendants demur. It is contended, in support of the demurrer, that the facts stated in the petition for the writ disclose a clear discretion in the defendants to accept or reject the bid of the relators, as they may deem its acceptance or rejection most conducive to the interest of the public. This the relators deny, contending that upon the refusal or failure of the Columbus Company to complete their contract and give the requisite bond, that they, as the next lowest bidders, having tendered a good and sufficient bond, were entitled to the contract as matter of statutory right. In this view of the relators we do not concur.

By the fourth section of the act of March 3, 1831, to provide for the erection of public buildings (2 S. & C. 1228), whenever the commissioners of a county determined to erect a court-house or jail, they were authorized either 'to receive sealed proposals for the performance of the whole or any part of the labor, or for furnishing materials, or “ to sell the same ” at public auction to the lowest bidder; and the person making the best proposals, or the lowest bid, in case the work was sold at auction, was entitled to the contract, if, in the opinion of the commissioners, he was a proper person to undertake such work. By the act of April 27, 1869 (66 O. L. 52), this section was repealed, and more extended provisions were enacted, relating not only to the erection of public buildings, but embracing the construction of county bridges. This act made it the duty of the commissioners to cause plans and specifications to be made and deposited with the county auditor, showing all the parts and the necessary details of the work, and required the auditor to advertise for sealed proposals for supplying the materials and performing the labor necessary to complete the erection. When this was done, and the proposals were received, it was made the duty of the commissioners to award the contract to the person who offered to perform the labor and furnish the materials at the lowest price, and who gave a good and sufficient bond to the acceptance of the commissioners, for the faithful performance of the contract.- It was under this act that Boren v. The Commissioners of Darke County, and Farman v. The Same Defendant, 21 Ohio St. 311, arose, and were decided. Subsequently, the legislature passed the act of May 5, 1877 (74 O. L. 186). This act required the commissioners or other public officers charged with the letting of the contract, to award the same to the lowest and best separate bidder, and in terms repealed all laws and parts of laws then in force, inconsistent with its provisious. § 2.

This act, together with that part of the act of 1869, re •quiring the commissioners to award the contract to • the person proposing to furnish the materials and perform the labor at the lowest price, upon his giving, a good and sufficient bond, was carried into the revised statutes (§§ 794, 799); and it was under these sections that the action of the commissioners, which is now complained of, was had. There seems, to some •extent at least, to be a want of harmony between these two ■sections,, as respects the duty of the commissioners in selecting the person to whom to award the contract. The former section requires the commissioners to award the contract to the lowest and best bidder, while the latter requires the contract to be awarded to the person offering to perform the labor and furnish the materials at the lowest price.

Without stopping to inquire whether the commissioners would be bound by section 799 to award the contract to the •lowest bidder, if in their judgment the public interest required his bid to be rejected and new proposals to be invited, «it is very clear that section 794, both in the terms it employs and in the purpose manifested by its language, confers upon the •commissioners discretionary power.

By its provisions they are required to determine, not merely who offers to do the work and furnish the materials at the lowest price, but who is the best and lowest bidder. As the law stood before the revision, there can be no doubt, under well-settled rules of construction, that, in so far as the act of 1869 was in its effect and operation at variance with the act of 1877, it must yield to the operation of the latter.. The latest expression of legislative will must govern. And upon rules of construction equally well settled, the two acts as incorporated into the revised statutes have the same effect, and must receive the same interpretation as they received before the revision took place. The court is only warranted in holding the construction of a statute which has undergone revision, to. be changed, when the intent of the legislature to make such change is clear1, or the language used in the new act plainly requires such change of construction to be made.

Neither an alteration in phraseology nor the omission or-ad dition of words in the latter statute necessarily require a¡. change of. construction. Conger v. Barker, 11 Ohio St. 1; Sedgw. on Stat. and Const. Law, 299, 365 ; Williams v. The State, 35 Ohio St. 175. The intent to give to the new act a different effect from the old, should be clearly manifested. Here, there was no substantial change in phraseology of the two acts, and certainly none in meaning and effect. The same construction, therefore, must 'now prevail as befpre the two acts were 'revised, and this requires us to. hold, that in so far as the two sections cannot be harmonized, effect must be given to section 79é. The two provisions being in pari materia, must be read together, and in view of the construction previously required. It is not however improper to-remark, that in thus holding, we do not wish to be understood as implying that the commissioners under the act of 1869, were not authorized to re-advertise for further proposals, where, for any valid reason, the contract was not made with the person offering to do the work and furnish the materials at the lowest, price, or that they were bound at alL events to let the contract, to him; nor do the cases from Darke county, svpra, so decide. The principle of those cases is, that the commissioners,, having determined not to re-advertise for further proposals» were bound to award the contract to the bidder offering to do. the work and furnish the materials at the .next lowest price,, where the lowest bidder failed to comply with the statute by entering into the contract and executing the requisite bond» This is the extent to which the court went.

If the commissioners were required, at all events, to award the contract to the one offering to perform the labor and to-furnish the materials at the lowest price, to determine ydiich. would be a mere matter of figures, it would not be difficult for bidders to so combine, as to secure the work at the full estimate-of the architect. The statute was enacted for the benefit of the-public, and not for individual bidders, and it should be executed with sole reference to the public interest.

Mandamus will lie only where there is a plain dereliction of duty upon the part of public officers, and can never be invoked to control discretion which is being exercised in good faith,, and with a sole view to the public welfare. Exp. Black, 1 Ohio St. 30.

Peremptory writ refused.


source: Caselaw Access Project

author: McIlvaine, O. J.

license: Public Domain

text:
    Mary Birchell v. Thomas Neaster.
    ■ 1. A. let a contract to B. for furnishing materials and building a house for a stipulated sum. B. employed 0. to furnish materials and to perform the labor of plastering. When the building was completed, except a. small part of the plastering, C., in the absence of B., informed A. that he would not finish the plastering unless A. would agree to pay him; and A. replied, “Finish the plastering and I will see you paid.” The obligations of B. to complete the house and to pay 0. not being released, Held, that the verbal promise of A. to see 0. paid was within the statute of frauds.
    2. The fact that there was due from A. to B., at the time the promise was made, a sum sufficient to pay the balance to C., did not take the promise out of the statute.
    3. In an action by C. against A., upon such promise, issue Ueing joined o by a general denial, it was competent for A. to rely upon the statute of frauds.
    Error to the District Court of Lucas County.
    The original action was brought in the court of common pleas of Lucas county, by defendant in error, against the plaintiff in error, to recover a balance claimed to be due him for material and labor in and about the plastering of a certain house belonging to the defendant below, and also to enforce a mechanic’s lien, which was alleged to have been secured under the statute.
    The defendant denied any indebtedness from her to the plaintiff, and also denied that the materials furnished or labor done, and for which it was alleged a mechanic’s lien had been .secured, were furnished or performed under any contract between her and the plaintiff. The statute under which the alleged lien was obtained, provides: “That any person who shall perform labor, or furnish materials ”....“ for ■erecting, repairing,” “ any house, building,” “ by virtue of a contract or agreement with the •owner thereof, shall have a lien to secure the payment of the same, upon ” . . . “ such house,” “ building or appurtenance, and the lot of land on which the same shall •stand or be removéd to.” 72 Ohio L. 166.
    In the court of common pleas a judgment was rendered for the plaintiff for the amount claimed, and a decree for the sale of the property to satisfy the lien as prayed for.
    This judgment and decree were affirmed by the district •court.

      G. F. Fra/noe and A. G. Houghton, for plaintiff in ■error:
    1. To be without the statute of frauds a promise which involves the payment of a debt originally contracted by a third party must be: 1. Upon a new consideration; 2. The consideration must be independent of the original indebtedness, and one moving between the parties; and, 3. There must be a discharge flf the liability of the original debtor to his creditor. All other such promises are within the statute. Easter v. White, 12 Ohio St. 219-230; Kelsey v. Hibbs, 13 Ohio St. 340-355; Leonard v. Vredenburg, 8 Johns. 29-39 ; Mallory v. Gillet, 21 N. Y. 412; Brown v. Weber, 38 N. Y. 187; Clay v. Walton, 9 Cal. 329; Puckett v. Bates, 4 Ala. 390; Hite v. Wells, 17 Ill. 88; 6 Pick. 509; Doyle v. White, 26 Me. 341.
    2. It was not necessary to plead the statute of frauds.
      Ridgeway v. Wharton, 3 De G., M. & G. 689; Bank v. Root, 3 Paige, 478 ; Small v. Owings, 1 Md. Ch. Dec. 366; Givens v. Calders, 2 Desauss. 187.

      T. J. MeDormell, for defendant in error:
    1. The promise was not within the statute of frauds. It was not a promise to pay the debt of another. Chapin v. Merrill, 4 Wend. 657; Easter v. White, 12 Ohio St. 226, and cases cited. It can make no difference that the work had been partly done before the making of ^the promise, nor would it, had the work been entirely completed. Parsons on Cont. (4 ed.) 316 ; Curtis v. Brown, 5 Cush. 488; Nelson v. Boynton, 3 Met. 396.
    2. Neaster was entitled to the possession of the premises at the time of the promise in question. He held the key, and the possession of Mrs. Birchell at the time was as to him illegal. Under the circumstances, her promise was intended to subserve a purpose of her own, and is not within the statute. Williams v. Leper, 3 Burr. 1886 ; Houlditch v. Milne, 3 Esp. 86; Allen v. Thompson, 10 N. H. 32; Hilton v. Dinsmore, 21 Me. 410; Randle v. Harris, 6 Yerger, 508.
    3. The statute of frauds cannot be made an instrument of fraud. It is not pleaded in this case. Woods v. Dille, 11 Ohio, 456 ; Minns v. Morse, 15 Ohio, 570; 10 Ohio, 568.
   McIlvaine, O. J.

The 'bill of exceptions shows that the plaintiff in error contracted with one Everard to furnish all materials, and construct for her a-dwelling-house upon a certain lot owned by her, and in consideration thereof, she promised to pay said Everard a gross sum. In fulfillment of his contract with the plaintiff in error, Everard employed the defendant in error to furnish the materials and perform the labor of plastering said house, for which material and labor Everard agreed to pay the defendant in error a certain price per yard. After the building had been completed, except a very small part of the work of plastering, and after the plaintiff in error had .moved into the house, the defendant in error went to the house to finish the plastering, but finding the plaintiff in error in pos¡session, entered into an agreement with, hex’, and thereupon ■completed the plastering at a very trifling expense. This agreement (hereafter fully stated) is claimed to be the ground of her liability in the original action.

Although the bill of exceptions does not in terms show that ■all the testimony is set out, it concludes :

“ Whex-eupon the court found that what defendant said to plaintiff, as given in the bill of exceptions aforesaid, would make her liable as ox-igixxal px-omisox-, and liable to pay for said plastex-ing, as well that which was done befox’e as after said promise; and rendered judgxnent against ,'defendaixt for the ■sum of $100.91,. and declared the same a liexx on said premises described in petition, and ordered same sold to satisfy said judgment.”

The testimony referred to is as follows. The plaintiff below testified: “Sometime in the month of March or April, 1875, •one Job Everard met me in a blacksmith shop on St. Clair street, and said he had the job of building the house on the px-emises in the petition desciibed, and asked me how much I would do the plastering for. I told him I would lath and plaster it for 25 cents per yard, two coat work, and to be a cash job, as his sister, Mrs. Birchell, had the money in the bank to pay him (Everard). As soon as said house was ready fox-plastering, said Everard xxotified me, and I immediately px-o■ceeded to do the plastering, and completed the whole of the plastering with the exceptions of pointing up after the carpenter work had been completed, soxne plastering around the base, and finish putting on the putty coat in one closet, and finishing coat in one place ixx the hall; to have completed the whole, it would have taken one day and three-fourths. Witness demanded some money from Everard, who said that his sister, Mrs. Birchell, expected some, and would pay him (Everard). That witness held the key of said house, and that said house was locked, axxd that said Everard opened said house, and defendarxt, Birchell, moved in. That said witness then- went up to said house and found defendant occupying the house, and witness said to defendant, I will not go on and finish the plastering or give up the key unless you will pay me; and deiendant said, ‘ Go on and finish the house and I will see you paid.’ That there was still left to complete said plastering, the putty coat in one closet and the putty coat in a portion of the hall, and considerable patching around the base board, and would take one and three-fourths days in all to complete it. That witness immediately went on and finished said plastering and demanded his pay from defendant (Birchell), who then said she had nothing to do with him (witness). This was about May 1, 1875. That witness had never met said defendant (Birchell), before that time, and never had any conversation with her before, neither did he know her before said conversation, and that was the first and only conversation he had with defendant, before said job of plastering was completed. 'That there were 550 yards of plastering, and it was worth 25 cents per yard, making a total of $137.50, and he had received from said Everard $40.00 and no more, and on the 25th day of June, 1875, witness filed his mechanic lien on the premises in .the petition described. Plaintiff also produced as a witness, Job Everard, who testified as follows:

“ ‘ I know the house in question. It is situated on the corner of Missouri and Division streets, in the city of Toledo, Ohio. I had the contract for building the house. Plaintiff done the plastering.’ On a cross-examination, said Everard testified: ‘ I made a contract to build the house with defendant, who is my .sister. I was to build the house, find. all the materials, and finish it complete and ready for occupancy for $850.00. Payments were to be made as I might want the money. After the plastering had been done, with the exception of a little patching up, I finished the carpenter work, and then went .and saw plaintiff and gave him the key of the house, and to.'d him to go and finish the plastering. That all there was to do was a little patching above the base board, which plaintiff would have to do, in his contract with me. 1 supposed plaintiff had done the patching before defendant had moved in the Bouse.’

“ The said plaintiff here having closed his testimony, the said ■defendant, Mary Birchell, to maintain the issue on her part, testified as follows, that is to say :

“‘Sometime in February, A. I). 1875, I employed Job Everard, to build me a house on the premises in the petition described. He was to build the house, find all the materials, and have the house ready for occupancy for $850.00. The payments to be made as the work progressed. I remember the time Mr. Neaster came to my house. It was the next morning after we moved into the house. He said to me, ‘ if I goon and finish the house will you see me paid ? ’ I said, ‘ I will see it paid, but I cannot pay you, as I made a contract with Mr, Everard and I will pay him.’ This was all that was said at the time. Mr. Neaster went on and done what little there was to-do. It took two or three men about two hours to finish all there-was to do. There was then about two hundred dollars coming to Mr. Everard, which I paid him on the 26th of June, 1875. I had paid $650.00 April 26th previous, to Everard. I never saw plaintiff before the morning'after I had moved in the house. I did not know he was doing the plastering until that morning. I never hired Neaster to do the plastering of the house.’

“ The defendant here having closed her testimony, the plaintiff called James McKinley, Wm. E. McBain, and Joseph Mathews. Eacli of said witnesses testified they were present at the conversation referred to by plaintiff with defendant, and that said plaintiff said to defendant, ‘ I will not go on and finish the plastering unless you will pay me,’ and defendant said, ‘ you goon and finish the plastering and I will see you paid.’ ”

Upon this testimony the question arises, whether or not the agreement was within the statute of frauds, which provides, “ That no action shall be brought whereby to charge the defendant upon any special promise to answer for the debt, default or miscarriage of another person, . . . unless the agreement upon which the action shall be brought, or some memorandum or note thereof, shall be in writing and signed by the party to be charged therewith, or by some other person thereunto by him or her lawfully authorized.”

The line which divides promises which are original and unconditional, from those which are collateral and conditional, especially when the subject-matter of the contract is the pre-existing debt of another, is sometimes very difficult to trace. The difficulty generally arises in ascertaining the true intent and meaning of the parties; but when these are ascertained, the plain meaning of the words of the statute must prevail. If the promise be collateral and conditional, it cannot be enforced, unless it be in writing.

It has been claimed that a new and distinct consideration passing between the creditor and the promisor, will take the promise out of the statute, though the original debtor remains liable. This cannot be the true test, as the statute can operate only on promises supported by a consideration ; because, promises, either in writing or verbal, unsupported by a considera^ tion, cannot be enforced, either under the statute or independent of it, and certainly the statute requires a promise to answer for the debt, miscarriage or default of another, though supported by a consideration, to be in writing..

It is unquestionably true, that whether or not the original debtor remains liable, is a very important fact in determining the nature of the new promise: but, after all, the controlling and ultimate question is, was the promise one to answer for'the debt, default or miscarriage of another, or was it an agreement to make the old debt the debt of the promisor.

In the case before us, 'Everard, the contractor, and debtor of the plaintiff below, was not released from his duty to complete the defendant’s building, nor discharged from his liability to pay the plaintiff for the entire work done by him. Now, when the words spoken by the defendant to the plaintiff below, which constitute the promise sued on, namely, “ I will see you paid,” are construed in the light of the circumstances, we can entertain no doubt that she meant nothing more, and was so-understood by the plaintiff, than that she would see that Everard paid the plaintiff’s claim, or, in other words, that she would pay the plaintiff if Everard did not. And such a promise is clearly within the statute of frauds.

■ Nor does the fact, that at the time the verbal promise was made, that the defendant below was indebted to Everard, the contractor and employer of the plaintiff, in a sum greater than the amount of the plaintiff’s claim against Everard, take the promise out of the statute.

This fact does not bring the case within the principle of eases wherein it has been held that an agreement is not within the statute of frauds, where one man who owes another a debt, agrees with his creditor to discharge his obligation by assuming and paying the amount to a third person to whom the creditor is indebted. In such cases the promisor does not assume to pay the debt of another merely, but agrees to pay his own debt to a person appointed by his creditor to receive it. Barber v. Bucklin, 2 Denio, 45.

But here the consent of Everard, to whom the defendant below was indebted, was not obtained, to such transfer of his credit; and without such consent the defendant remained the debtor of Everard, to whom alone she was obligated to make payment.

It is true, the plaintiff below might, under favor of the mechanics’ hen statute, have subjected the money in the hands of the defendant and owing to the contractor to the payment of his claim for labor and material; but no steps to that end were taken. The only lien which the plaintiff sought to perfect under the statute, was one in favor of a principal contractor.

The claim of plaintiff in error, that the statute should have been pleaded, .is not well founded.

Judgments of the dist/riet court cmd of common fleas reversed / amd cause remanded to court of common fleas.


author: Johnson, J.

text:
    George W. Harper v. Joseph C. Crain.
    la August, 1872,0. sold and delivered to H. a horse, upon his written contract to pay therefor $140 one day after G. should be re-elected president of the United States; but if G. was not re-elected, then the obligation was to be void. Before the election, H. returned and tendered back the horse, in as good condition as when received, and demanded his contract, but C. refused to receive the horse or surrender the contract. Thereafter, H. kept the horse as bailee of 0. After the election, at which G. was elected president, 0. demanded the contract price of the horse, and, on refusal by H. to pay, but while he was ready and willing to return the same, brought an action under the act of 1831 (1 S. & 0. 664), to recover the value of the property. Held,

    1. That the transaction was a wager, within the meaning of said act, and the contract was void.
    '3. That H. might, before the election took place which was to determine the wager, rescind the contract by surrendering back the horse.
    ■3. After such refusal to take back the property, H. might elect to hold the property as bailee of C., and he is not liable under the statute for its value, unless it appears that, at the time the action was commenced, ■he had refused to deliver him back, or done some act amounting to a ■conversion of the property to his own use.
    Error to the District Court of Greene County.
    The original action was brought before a justice, December 21, 1872, by Crain against Harper, to recover $140, the value of one horse, sold and delivered August 27, 1872.
    Harper denied the indebtedness, and set up as a defense that the horse was sold upon a wager on the presidential election, ■and that before that event he returned the horse and drew the wager.
    After a trial and judgment the case was appealed. In the common pleas, Crain filed his petition, alleging, as before the' justice, that Harper was indebted to him for $140, with interest from August 27, 1872, for a horse that day sold and delivered at his recpiest.
    The defendant answered, that the horse was sold and delivered under the following special contract:
    “ Cedar ville, O., Aug. 27, 1872.

      “ Eor value received, one day after General U. S. Grant is re-elected President of the United States of America, I promise to pay J. C. Crain One Hundred and Forty Dollars. The condition of note is that if the said Grant is not elected this note is null and void.
    <c Witness. “ G. W. .Harper.
    “ S. L. Stewart,'
    “ A. T. Boyd.”
    He alleges that, on October 27,1872, he returned and offered to deliver back the horse, and the plaintiff refused to receive it, and that thereafter, until March 8, 1873, he was at all times-ready to return the horse, and on that day he sold him at public auction to the highest bidder, after due notice to Crain.
    A demurrer to this answer was overruled, and the plaintiff, upon leave, amended his petition, -in which he avers a delivery of the horse under above special contract, the non-payment and the refusal to pay therefor, and that defendant “ has disposed of and converted the same to his own use,” whereby a cause of action has accrued to him for. the value of the horse, under “ An act for the prevention of gaming,” passed March 12y 1831.
    The defendant moved to strike this amended petition from the files, for the reason that it was not an amendment of the original cause of action, but was wholly a new and distinct cause of action.
    This motion was overruled, and an exception was noted. The defendant then answered, setting up the same matter as in his original answer, and averring that he has always been ready to pay to plaintiff the $61.50 proceeds of the sale of the horse, and now brings the same into court, &c.
    The reply admits the offer to return the horse in October, and plaintiff’s refusal to receive it, for the alleged reason that defendant had kept it as his own for about two months, “ whereby, and by reason of the fault of the defendant, the said horse had materially depreciated in value, and that plaintiff had lost the use thereof in his business.” A claim was also interposed by defendant as a set-off, but, as it does not affect the errors assigned, need not be noticed.
    After a judgment in favor of the plaintiff, and its reversal by the district court, the case was again tried in the common pleas, resulting in a like judgment for plaintiff below, which was affirmed by the district court.
    To reverse this judgment is the object of the present proceeding in error.
    Upon the overruling of a motion for a new trial, a bill of exceptions was taken by plaintiff in error, setting out all the testimony and the charge of the court.
    Numerous errors are assigned, among others that the verdict was against tlie law and the evidence, and that the court erred in overruling a motion for a new trial, made on that, among •other grounds.

      B. F. Howard and John Little, for plaintiff in error:
    The tender was a complete bar to the action. The contract between the parties was a wagering contract, and was illegal and void. At common law neither party could maintain an action upon it. That law would leave the parties to the contract just'where they had placed themselves. The statute has .so far changed the law as to enable the party who has lost money or property by means of any bet or wager, and has actually paid or delivered it to the winner, to bring an action .against the winner to recover the same. Now, if Crain was the loser in this case, within the meaning of the statute, and for the sake qf the argument it is conceded that he was, he would have had a right of action against Harper for the recovery of the horse; and it would have been the corresponding ■duty of Harper to have returned the horse to Crain. The return of the horse would have had the effect of relieving Harper from his liability to be sued. He was not bound to wait to be -sued. He might voluntarily do what Crain had a right to rehuiré at his hands. The tender by Harper and the refusal by Crain to accept were equivalent to a performance, and Harper was thereby discharged from all obligation to Crain. He had ■done all that he was bound to do, and all that Crain had a Right to require of him. After the tender and refusal, Harper had his election either to abandon the horse or to retain possession. If he continued to retain possession he was bound to deliver on demand, or if he sold, he would be answerable for the proceeds of the sale. 2 Parsons on Cont. 654, and note; 2 Kent Comm. 509; Chapman on Cont. 27, et seq.; Lamb v. Lathorp, 13 Wend. 97; Slengerland v. Morse, 8 Johns. 478; Cait v. Houston, 3 Johns. Cas. 249.
    The winner has no right of action under the statute to recover money or property lost upon any bet or wager. 1 S. & C. Statutes, 664, § 2. In this case Crain was the winner. Harper was the loser. See Simmons v. Bradly, 26 Wis. 689.

      At common law do action could be maintained upon a wagering contract by tbe loser against the winner, nor by the winner against the loser. Yates v. Foote, 12 Johns. 1; Demistan v. Cooke, 12 Johns. 376; 13 Ind. 344; 11 Ind. 59; Bunn v. Reker, 4 Johns. 426 ; Rucker v. Pitcher, 1 Comst. 392.

      E. H. Munger, for defendant in error :
    Harper’s answer alleges that he “ offered to deliver ” and. “ tendered ” the horse to Crain. In his reply, Crain expressly admits the “ offer to deliver,” but at the close denies all the allegations of the answer which are not expressly admitted— thus making an issue as to the alleged tender. For an “ offer to-deliver ” and a “ tender ” are not synonymous. There may be an offer to deliver a thing which is elsewhere — beyond reach.. To constitute a tender the thing must be present — -within reach. Benjamin on Sales, § 113. The plea of tender, even if not denied, is no bar to the action; because, 1. The reply contains, allegations sufficient to avoid the tender. 2. Harper himself admits Crain’s right to recover to the extent of the amount, brought into court.' 3. A tender is no bar to an action. 5-Pick. 285 ; 6 Pick. 340; 2 Parsons on Cont. (4 ed.) 150, notes; 16 Ohio, 451; 2 Ohio St. 10,11. No demand neeessary on the part of Crain before suit. 1 N. Y. 392.
    The “ winner ” as well as the “ loser ” (so called by the statute) is entitled to an action, when the “ winner ” of the wager is the loser of the property or the thing wagered, within the-meaning and intent of the statute. It is a question of the construction of the statute. “ In construing a statute the manifest reason and intention of the law should prevail, although at variancewitli the literal import of the language employed.” 3 Ohio St. "53, 80; 1 Ohio St. 543; 2 Ohio St. 210, 442 ; 6 Ohio St. 112..
   Johnson, J.

Although exception to the charge of the-court are not specifically made, yet as we have all the evidence as well as the charge, it is proper to examine it in connection with the evidence, in order to determine whether the verdict and judgment are according to law and evidence. Marietta & Cincinnati R. R. v. Strader, 29 Ohio St. 452.

This transaction was a wager, or bet, on the result of an election, and therefore void. Thomas v. Crouse, 16 Ohio, 54; Lucas v. Harper, 24 Ohio St. 328.

It is a fact, admitted in the pleading, and not controverted by the evidence, that before the election which' was to determine the wager, Harper returned and offered to re-deliver the horse to Crain, but he refused to receive it, because, as he states in his reply, the defendant had kept said horse as his property for the space about two months from and after the sale and delivery thereof to him, whereby,-and by reason of the fault of the defendant, the said horse liad materially depreciated in value, and that the plaintiff had lost the use thereof in his business.”

The pleadings thus made up presented, aside from the question of value, but one issuable fact, i. e., whether the plaintiff had the right to refuse to receive back the horse and sue for its value, on the ground that the defendant had converted him to his own use; or rather, whether his excuse for not receiving back the horse, for the reason set up in his reply above quoted, was valid.

That the horse was delivered to Harper under a wager contract, and that there was an offer to return, and a refusal to receive, before the election, was admitted by the pleadings.

Upon this state of fact, what were the rights of the parties ?

The statute prohibits such contracts, and gives a right of action to recover back to the loser.

Independent of this statute, there was no remedy for the loser, where the money or property had been delivered, as the law would not lend its aid to a party either in the execution or rescission of such a contract.

The.maxim, “ex turpi ca/usa, non oriter actio” applies in such cases, and leaves the parties where it finds them. Where property or money was lost, under a wager, prohibited by public policy, or by statute, it was the policy of the law to afford no remedy to the loser, because he was in pari delicto with the winner.

Again, in all cases of contracts prohibited by statute, or which are void as against public policy, the law allows a day for repentance, while the contract remains executory. He who advances money in consideration of a promise or undertaking to do such a thing, may, at any time before it is done, rescind the contract, and prevent the thing from being done, and recover back the money.

. But it would seem obvious, that if he delays rescinding until hi's rescission is inoperative, and the thing will still be done, although the contract, at the time of the rescission, was in form executory, it should come under the same rule as an executed contract for unlawful purposes.” 2 Parsons on Cont. 746, note v; Hooker v. De Palos, 28 Ohio St. 251; McAllister v. Hoffman, 16 S. & R. 147.

McAllister v. Hoffman was an action to recover back money in the hands of a stakeholder, deposited as a bet upon an eleclion..- After the election, the loser, upon notice-to the stakeholder hot to pay, the winner brought this action against the stakeholder, to recover it back.

. There was no statute in Pennsylvania, as in this state, authorizing a recovery back, but there was an act prohibiting such wagers.

It is there said, that by narrowing the locus penitential to the interval between the period of betting and the happening of the contingency, the object of the statute will best be promoted. Within this interval of time, the policy of the law is to allow either party to rescind an unexecuted contract, and to reinstate himself to his original status.

It being an admitted fact, that before the election Harper offered to return the horse and Crain refused to receive it, it follows that this offer was in the exorcise of a lawful right to rescind, unless, at the time of such offer, there had been such a conversion of -the property as excused Crain from the dury of receiving back the property.

By the clear weight of the testimony, and indeed there is scarcely a shadow of proof to the contrary, the horse was in as good, if not in a better, condition when the offer to return was made, than he was when delivered to defendant in August. It was therefore the duty of plaintiff to surrender the noto and take back-the horse. His excuse, as pleaded, to say nothing of the want of proof to sustain it, for not receiving back the horse, was based in part, if not wholly, on untenable ground. It was, that defendant had had the usé of him for about two months as his own, whereby, and by reason of the fault of the defendant, and also that the plaintiff had lost the use thereof 'in his business.

Two of these three reasons, to wit, the plaintiff’s loss of use, •and defendant’s use of the horse for two months as his own, without acts amounting to a conversion, did not deprive the •defendant of his right to rescind, nor excuse the plaintiff from Jais duty to take back the property.

Upon this state of pleading and of fact, the court charged the jury that plaintiff was entitled, under the statute, to recover the value of the horse, unless that right was defeated by the facts stated in the answer.

Notwithstanding the admitted offer to rescind and the refusal to accept, the plaintiff’s right to recover the value of the property, as a loser, is assumed by the court, unless defendant, upon whom the burden is cast, by the charge of the court, establishes the truth of the allegation of his answer.

In effect, this was telling the jury that the plaintiff might, '-under the statute, recover, not the property m specie, but its value, without also showing that defendant had comverted it to ■his own use, and in the face of the offer to surrender the prop•erty, and plaintiff’s refusal to receive it. This was clearly •erroneous.

Lucas v. Harper, 24 Ohio St. 328, was a case somewhat like the present. It was a sale of hogs at nine cents per pound, which were worth less than half that sum, to be paid for when H. G. should be elected.

The hogs were delivered, under this contract, to defendant, who converted them to his own use. After the election and •defeat of II. Gf, an action was brought to recover the market value of the hogs, under the act of 1831, and it was held that the transaction was a wager, and that the person losing might maintain this action against the winner under that act.

The case at bar differs from that in two material points : 1st, In this there is the absence of any proof of conversion, while in that there was an actual conversion; and 2d, In this the contract was rescinded before the election, while in that it was not.

Assuming that this action under this statute to recover back the property is maintainable, we think the plaintiff should prove, as he has alleged, that defendant has converted the property to his own use.

There should have been as demand and refusal to deliver,, which in law would amount to a conversion, or such an actua£ conversion as would have rendered a demand useless. Certainly, after defendant had offered to return the property, and the offer was refused, and when he was holding it as a merebailee for plaintiff, with reasonable and ordinary care, as the.proof shows, he was not liable for its conversion.

The amended petition was based upon this theory, for it alleges that plaintiff “ has disposed of and converted ” the horse-to his own use. This petition was filed, after the sale of the horse, in March, 1873, as stated in the answer, long after suit, brought, and such sale was not made by defendant as owner,, but as bailee of Crain.

Resides this, the rights of the parties were to be determined as they existed when the action was commenced, in December previous.

At that time, there is no pretense that there was anything-which, in law or in fact, amounted to a conversion. The proof abundantly shows that the horse was then in as good, if not ini better, condition than when delivered in August, and that defendant was at all times not only ready and willing to deliver back the property, but urgent that plaintiff should receive it,, and that the latter insisted on his keeping it, and paying the-agreed price.

To allow the plaintiff to recover the value of the horse upon the conceded facts of this case, would, in effect, enable him to-enforce a contract which is null and void, and that too, after it had been lightfully rescinded, without showing any act of defendant which, in law or fact, amounted to a conversion.

It is a matter of serious doubt whether such an action can be maintained under the statute, where the wager is withdrawn or the contract is rescinded before the contingency lias happened,, which determines it; but assuming, for the purposes of this case, that it can, we hold, that where, between the making of the contract and the happening of the contingency, either party elects to rescind, and offers to deliver back the money or property, which offer is refused, he is not liable for its value under the statute, without a showing that, before the .commencement of the action, he has, by a refusal to deliver on demand, or by some other act amounting to conversion, made himself liable for conversion of the property.

"We pass without consideration all other questions appearing-upon the record, and reverse the judgments below, on the ground that they are contrary to the law and the evidence.


author: White, J.

text:
    Phillip Cramer v. Milton Moore.
    In an action on a promissory note, tlie maker is not estopped from setting up want of consideration or fraud, by a judgment dismissing Ms petition on tbe merits, in an action brought to enjoin the negotiation of the note and to obtain its surrender and cancellation,-although the matter set up as a defense was relied on as the ground of relief in the petition.
    Error to the District Court of Summit County. -
    The action in the court below was brought by Moore against. Cramer, upon four negotiable notes given by Cramer to Allen & Hopkins, March 13, 1868, and shortly after, and before due, indorsed to Moore. Cramer answered that the notes were-obtained by fraud for a worthless patent right, and -that Moore-was aware of the fraud, and took the notes to aid in its consummation. That at the time he took them, an injunction existed, allowed on a petition praying that the payees be restrained from negotiating them, and as a final relief, their delivery up and cancellation. To this Moore replied, denying all fraud, either of the payees or himself, and averring that he took the notes “ in the usual course of trade for a valuable consideration ■without any knowledge on his part of any infirmity in said notes.”
    He further insists that Cramer is conclusively estopped from ■setting up or proving any of the facts stated in his answer in relation to fraud in obtaining the notes, he having stated substantially the same facts in his action for the injunction, which, upon being prosecuted to final hearing in the district court, was dismissed upon the merits.
    On the trial the court ruled out the record of that suit, holding that it constituted no bar to the defense of Cramer.
    The trial resulted in a verdict and judgment for the' defendant.
    On error, the district court reversed the judgment, on the. ground that the judgment in the action prosecuted by Cramer for an injunction was a bar to his making the defense in the action on the notes.
    The object of the present petition is to obtain the reversal •of the judgment of the district court.

      P. P. Pcmney, for plaintiff in error:
    1. The dismissal of the petition in the injunction suit is no bar to a defense at law, in a suit upon the notes. Greenleaf, •§§ 523, 524; 24 N. J. Eq. 378 ; 7 Johns. Ch. 3 ; 4 Ohio St. 251; 13 Ir. C. L. 506 ; 7 Ad. & El. 313; 5 Clark & F. 670.

      8. JBwrJee, for defendant in error:
    The judgment in the injunction suit between Cramer and Allen was conclusive upon Cramer, in the case at bar. 12 Ohio St. 11; 6 Wheat. 109; 1 Ohio, 134; 3 How. 413 ; 5 Ohio, 460 ; 6 Ohio, 529; 1 Blackf. 360 ; 18 How. 418.
   White, J.

The original action was brought by Moore, the indorsee of the notes, against Cramer, the maker, to recover the amounts due thereon; and the question is, whether Cramer is estopq>ed from proving that the notes were without •consideration, and were obtained from him by the payees through fraud.

On behalf of Moore, it is alleged that Cramer is thus estopped from making defense to the notes. The ground of the alleged estoppel is, that Cramer, after the delivery of the notes to the payees, brought suit against them to enjoin the negotiation of the notes, and to obtain a decree or judgment for their surrender and cancellation; that the grounds of such relief were the same, in substance, as he now sets up as a defense to the suit on the notes; and that, after the allowance of a provisional injunction, the case was finally heard upon the merits and dismissed.

We do not question the principle insisted upon on behalf of the defendant in error, Moore, that a judgment of a court of competent jurisdiction, upon a question necessarily involved in a suit, is conclusive in a subsequent suit between the same parties, depending on the same question; and in respect to this quality of conclusive effect upon parties and privies, the decrees of courts of equity, upon matters within their jurisdiction, stand upon the same footing with judgments at law.

But in determining the application of this principle to the present case, regard must be had to the nature of the equitable jurisdiction called into exercise in dismissing the petition seeking the surrender and cancellation of the notes in question.

The foundation of equitable jurisdiction is the inadequacy of the common law to afford the necessary relief. Hence, there is a marked distinction between cases where equity interferes with the remedies afforded to parties by the course of the common law, and cases where equity refuses to interfere.

If in the present instance, the court, instead of refusing to interfere and dismissing the petition had found the then plaintiff, Cramer, entitled to the equitable relief sought, and had decreed the surrender and^cancellation of the notes, the legal right of the payees to sue on the notes would have been extinguished ; or if, in violation of the injunction, the payees had put it out of their power to surrender the notes, the court could, doubtless, have followed them into the hands of any party taking them in known violation of the injunction. But such was not the finding and decree of the court. And the findings of fact in the case were only material as laying the foundation for the judgment or decree that was, in fact, rendered.

In speaking of the effect of such a decree, in Neafie v. Neafie, I Johns. Ch. 5, Chancellor Kent says: “A decree dismissing a lili upon the merits, does not establish any new right to be carried into effect; it only declares that the plaintiff has failed to establish the equity which he had set up.” And in Beere v. Fleming, 13 Ir. C. L. R. 506, it is laid down “ that the dismissal of a bill seeking equitable relief in respect to an instrument on which a party can sue at law, is no bar to •an action at jaw upon the same instrument, although the decree does not state the dismissal to have been without prejudice.” See also, Lessee of Wright v. Deklyne, 1 Pet. C. Ct. 199.

It seems to be well settled that, in the case of bills for the specific performance of agreements, although the bill be dismissed without any reservation of the plaintiff’s rights to proceed at law, he may sue at law on the agreement. Beere v. Fleming, supra; McNamara v. Arthur, 2 Ba. & Bea. 349.

And certainly, no greater effect upon the legaPrights of the parties can be given to the refusal to require the surrender of an agreement, than to the refusal to require its specific performance.

The only effect, therefore, in our opinion, of the dismissal of the petition, was to declare that the plaintiff had no equitable right to maintain the action; and that the rights of the parties remained the. same as if no action had been brought, or injunction allowed, save only that the dismissal was a bar to the bringing of another action for the same matter.

Judgment of the district court reversed, and that of the common pleas affirmed. %


author: Boynton, J.

text:
    The Franklin Bank of Cincinnati v. The Commercial Bank of Cincinnati.
    The plaintiff and defendant were banking corporations, organized under the act of March SI, 1851, to authorize free hanking (1 S. & 0. 168). The plaintiff loaned to F., president of the defendant, $10,000, on his individual account, and received as security for the loan a certificate, owned by F., of two hundred shares of the capital stock of the defendant, of the par value of fifty dollars each. The plaintiff presented said certificate to the defendant, at its place of business, and demanded a transfer of said shares to the plaintiff, on the books of the company, which was refused; whereupon the plaintiff brought an action against the defendant for the conversion of said stock, founded, on said refusal to transfer the same to the plaintiff.

      ¡Held, that the plaintiff was not entitled to said transfer, and, consequently, that the defendant was not liable for refusing to make or permit it.
    Error to the Superior Court of Cincinnati.
    The plaintiff and defendant were banking corporations, organized under the act “ to authorize free banking,” passed March '21, 1851 (1 S. & C. 168). Their corporate existence, except for purposes of winding up their affairs, ceased on the 1st day ■of January, 1873. On the 19th day of March, 1869, the defendant, the Commercial Bank, issued to Charles B. Foote, its president, a certificate of ownership of two hundred shares of fhe par value of fifty dollars each of its capital stock, which •certificate was as follows :
    “ Commercial Bank of Cincinnati, State of Ohio.
    “ Number 44. Shares, 200.
    “ This certifies that Charles B. Foote, of Cincinnati, Ohio, is the proprietor of two hundred shares of fifty dollars each in the Capital Stock of the Commercial Bank of Cincinnati. ( 25 cents. ) Transferable only on the books of the bank by ( Revenue Stamp. \ the said Charles B. Foote or his lawful attorney, on the surrender of this certificate, and is subject, together with all dividends thereon, for any debts or demand due from the holder to said bank.
    “Cincinnati, March 19th, 1869.
    (Signed) “ H. Colville, (Signed) “ Charles B. Foote,
    “ Cashier. “ President.”
    Indorsed in blank, on the back as follows:
    “Witness, “ Cha. B. Foote.
    H. Colville.”

      The by-laws of the defendant prohibited a transfer of the shares of a holder while indebted to the bank.
    • On May 16, 1870, Foote, who was then, and continued to-be, until about the 15th day of October, then next, the president and a director and stockholder of the Commercial Bank, borrowed of the plaintiff, the Franklin Bank, on his own account, the sum of $10,000, payable on demand, and delivered to the Franklin Bank, said certificate, as security for said loan. At this time Foote was indebted to the Commercial Bank in a* sum largely in excess of the value of said two hundred shares, of stock; but at the same time he was the owner of a large-number of the shares of the capital stock of said bank, in addition to said two hundred shares. But at no time was li/s indebtedness to the Commercial Bank reduced below the actual value of two hundred shares of the capital stock.
    On December 31,1872, the plaintiff presented said certificate to the Commercial Bank, and demanded a transfer on its books-of said two hundred shares of sto<& to the name of the plaintiff, which transfer was refused. "Whereupon the plaintiff brought the original action, setting up said loan, the pledge of said stock as security therefor, with notice thereof to defendant, the presentation of said certificate, and the demand for-said transfer, with the refusal of the defendant, and alleged a. consequent conversion of said stock by defendant. The petition prayed a judgment against the defendant for refusing said transfer, for the sum of $10,56143, the amount then due from Foote on said loan, alleging the value of said two hundred shares of stock to be in excess of said sum. The petition also-prayed for such other relief, legal or equitable, as might become proper.
    The case went to trial, and a bill of exceptions was sealed, containing all the testimony, which in view of the opinion of the court and the facts above stated, it becomes unnecessary to* notice further, except to state, that proof was offered, showing a custom among bankers to fill the blank indorsement on the back of a certificate of bank stock, authorizing the holder to> transfer the shares on the books of the company.

      Sections 11 and 12 of the act under which the plaintiff and defendant were incorporated are as follows:
    " 11. The capital stock of every company shall he divided into shares of fifty dollars each, which shall be deemed personal property, and shall only be assignable on the books of the company, in such manner as its by-laws shall prescribe ; each bank shall have a lien upon all stock owned by its debtors, and no stock shall be transferred without the consent of a majority of the directors, while the holder thereof is indebted to the company.”
    "12. No company shall take as a security, for any loan or discount, a lien upon any part of its capital stock ; but the same security, both in«kind and amount, shall be required of shareholders as of persons not shareholders ; and no banking company shall be the holder or purchaser of any portion of its capital stock, or of the capital stock of any other incorporated company, unless such purchase shall be necessary to prevent loss upon a debt previously contracted in good faith, on security, which at the time was deemed adequate to insure the payment of such debt, independent of any lien upon such stock ; and stock so purchased shall in no case be held by the company so purchasing, for a longer period of time than six months, if the same can be sold at what the stock cost at par.”
    The first sentence of section 13 is as follows :
    “ In all elections of directors, and in deciding all questions at meetings of the stockholders, each share shall entitle the owner thereof to one vote.”
    -The superior court gave judgment for the,defendant, which judgment it is now sought to reverse:

      Healy dk Bra/nnam, and Lincoln, Smith dk Stevens, for plaintiff in error.

      Matthews, Ramsay do Matthews, for defendant in error :
    The plaintiff and defendant were incorporated under tbe act of March 21, 1851 (1 S. & G. 170), as banking companies. Banks incorporated under that act are expressly forbidden to purchase or hold shares in other corporations, and by clear implication, forbidden to loan upon such shares. Straus v. Eagle Co., 5 Ohio St. 59; Fowler v. Scully, 72 Penn. St. 456.

      Healy & Brannan, and Lincoln, Smith & Stevens, in reply, claimed that even if the taking of the shares as security, is within the prohibition of section 12 of said act, still no one but the.state.can complain of such an act. Leazun v. Hillegas, 7 S. & R. 311; 12 Wall. 361; 3 Rand. (Va.) 136 ; 29 Mo. 576 ; 12 Am. L. Rev. 143 ; 24 Ohio St. 28. It was the duty of the defendant to make the transfer and let the state impose the penalty, if the plaintiff has disregarded the law. Union National Bank v. Matthews, 98 U. S. 621. The prohibition of said section 12 extends only to cases oí purchase of stock, and not to,a loan upon collateral security of bank shares. 4 Johns. Ch. 370 ; Baird v. Bank of Washington, 11 S. & R. 411; Angel & Ames on Corp. § 157 ; Ayers v. Bank, L. R. 3 P. C. 548, 558, 559.
   Boynton, J.

We are met at the threshold of the case with the inquiry, whether an action will lie in favor of the plaintiff against the defendant for refusing to transfer, on the books of the defendant, to the name of the plaintiff, thé two hundred shares of the capital stock of the defendant, represented by the certificate issued to Foote, and by him pledged to the plaintiff as security for the loan obtained. Such refusal to so transfer said stock, and an alleged consequent conversion of the same by the. defendant, constitute the gravamen of the plaintiff’s action. The 12th section of the act under which the two corporations were organized and from which they derived their powers, ex-. pressly provided, that no banking company organized under its provisions should be the holder or purchaser of any portion of its capital stock or of the capital stock of any other incorporated company, unless such purchase should be necessary to prevent loss upon a debt previously contracted in good faith, on security which, at the time, was deemed adequate to insure the payment of such debt, independent of any lien upon such stock. 1 S. & <C. 170, § 12. And by section 29 it was provided, that all the rights, privileges and franchises which the company derived from the act should be forfeited, if the directors of the company should knowingly violate, or permit any of the officers or agents of the • company to violate, any of the provisions of the act. That the stock in the present case was pledged or received to secure a precedent loan is not claimed.

There vrould seem to be little doubt, either upon principle or authority, and independently of express statutory prohibition. -of the same, that one corporation cannot become the owner of ■any portion of the capital stock of another corporation, unless authority to become such is clearly conferred by statute. Mutual Savings Bank, &c. v. Meriden Agency, 24 Conn. 159 ; Franklin Company v. Lewiston Savings Bank, 68 Me. 43 ; Central Railroad Company v. Collins, 40 Ga. 582; Sumner v. Marcy, 3 W. & M. 105. Were this not so, one corporation, by buying up the majority of the shares of the stock of another, ■could take the entire management of its business, however foreign such business might be to that which the corporation so purchasing said shares was created to carry on. A banking ■corporation could become the operator of a railroad, or cany •on the business of manufacturing, and any other corporation ■could engage in banking by obtaining the control of the bank’s stock. Nor would this result follow any the less certainly, if ■the shares of stock were received in pledge only, to secure the payment of a debt, provided the shares were transferred on the books of the company to the name of the pledgee. A person in whose name the stock of the corporation stands on the books ■of the corporation, is, as to the corporation, a stock-holder, and has the right to vote upon the stock. State ex rel. White v. Ferris, 42 Conn. 560; Exp. Willcocks, 1 Cow. 402; In re Barker, 6 Wend. 509; Hoppin v. Buffum, 9 R. I. 513; Field on Corp. § 69.

Hence, if the plaintiff appeared on the books of the defend-' ant as the transferee or owner of the two hundred shares of stock represented by the certificate to Foote, it would have the right to vote upon the stock at all meetings of the stockholders of the defendant; and it would only be necessary for it to procure in pledge, as security for money loaned, a majority of the ■shares of the capital stock of the Commercial Bank, in order to obtain full control of its affairs, and take charge of its banking operations. This would not only be exercising powers granted to the plaintiff neither expressly nor by implication, but those ■which are clearly opposed to the manifest spirit and intent, if not to the language, of the statute. This court has uniformly adhered to the doctrine announced in Straus v. Eagle Ins. Co., 5 Ohio St. 59, that corporations have such powers, and such only, as the act creating them confers; and are confined to the exercise of those expressly granted, and such incidental powers as are necessary to carry into effect those specifically conferred. Bank of Buffalo v. Toledo F. & M. Ins. Co., 12 Ohio St. 601. This principle has recently been, most emphatically asserted, both by the supreme court of the United States in Thomas v. Railroad Co., 101 U. S. 71, and by the House of Lords in Ashbury Railroad Carriage and Iron Co. v. Riche, L. R. 7 H. L. 653. It was claimed in argument in both of these cases, that a corporate body may do any act which is not either expressly or impliedly prohibited by its charter; although it was conceded, that a stockholder might enjoin the act where it was not authorized, either expressly or by implication, and that the state, by proper process and proceedings, might forfeit the charter. But it was held in the first case, that the powers of a corporation organized under a legislative enactment, are such only as the statute confers, and. that the enumeration of them implies the exclusion of all others.. And by the second case, that the contract sued on, being of a. nature not included in the Memorandum of Association, was. ultra vires, not only of the directors, but of the whole company, and which the whole body of shareholders was incapable of ratifying.

Notwithstanding the rule thus prevailing, the act under which both the plaintiff and defendant were organized, did not leave-the right or power of the plaintiff to acquire the title to shares-of stock in another corporation, to be determined alone upon, the principle of construction which the ride above stated adopted. The right to deal in shares of stock in other corporations is not only not found among the enumerated powers-which the act confers upon banks organized under its provisions, but the power, in language of the most undoubted import,, is denied, and its exercise expressly prohibited. It therefore-follows that the refusal of the defendant to permit the transfer upon its books to the plaintiff of the two hundred shares of its stock, violated no right of the plaintiff, and consequently created no liability on the part of the defendant. Such refusal did not amount to a conversion of the stock

Its action in refusing the transfer was but the denial of any right by the plaintiff to bo placed in a position to interfere and participate in the control and management of its internal affairs. To the claim of the plaintiff, that it was the duty of the •defendant to make the transfer, when the same was demanded, •and leave the state to impose the penalty of forfeiture on the plaintiff for a violation of its charter, we do not assent. The cases of Union National Bank v. Matthews, 98 U. S. 621, and Jones v. Guaranty and Indemnity Co., 101 U. S. 622, and the cases therein cited, do not support such proposition. 'The principle of those cases is, that where a corporation is incompetent by its charter to take a title to real estate, a conveyance to it is not void; but voidable only, and that the sovereign ■alone can object. That the conveyance is valid until assailed in •a direct proceeding instituted for that purpose. But they neither, by the principle maintained, nor by the reasoning advanced in support of it, sanction the doctrine that one corporation may buy up the stock of another, and thereby enable itself ■to interfere with the internal management of its affairs, especially where the power to do so is expressly prohibited by its •charter.

In our opinion the petition stated no cause of action against the defendant, and hence laid no foundation for a judgment in favor of the plaintiff. That the plaintiff may have

rights by the pledge received from Foote, to such interest in the bank as said certificate of stock represented, is quite true. But what that interest is, if any, we cannot in the present case •determine.

Judgmemt affi/rmed.


author: McIlvaine, C. J.

text:
    Milton W. Powers v. George Armstrong et al.
    1. In an action under the code for the recovery of real estate, whereof the legal title is in the plaintiff, a defense, grounded on an equitable title and right of possession under it in the defendant, must be pleaded.
    3. In such case, where the answer contains a general denial of the plaint-ill’s title merely, it is error to adijiit testimony of such equitable estate-in the defendant, and to charge the jury that such equitable estate, if duly proved, constitutes a defense to such action.
    Error to the District Court of Mahoning County.
    The original action was brought by plaintiff in error against defendants in error to recover the possession of an undivided! half of a certain tract of land situate in Mahoning county-The ownership of defendants of the other half was admitted by plaintiff. The common source of title was in Eunice,. Phoeba, Amos and Luther Parkhurst, as tenants in common. The interest of Eunice, in the lands in controversy was eliminated by proceedings in partition, so that Phoeba, Amos and Luther became tenants in common, each owning one third part-In 1830 Phoeba disappeared from her home under circumstances which, after the lapse of seven years, gave rise to a. presumption of her death. At her death her interest vested in. her surviving co-tenants as her heirs. Luther, thus becoming; seized of one-half of the premises by an undisputed title, undertook to convey the entire property in fee to one James-Price, by deed of general warranty, bearing date October 29,. 1838. It is conceded that the defendants have succeeded to-the estate thus granted. Amos Parkhurst died in the year-^831, leaving one Juliet, an infant daughter, his sole heir and legal representative, who afterwards, on the 27th of June, 1870,. conveyed all her interest in the lands to the plaintiff. In 1871,. the plaintiff, claiming under a title thus derived, brought his-action, under the code, to recover possession, alleging in his-petition that he had the legal title to, and was entitled to the-possession of the undivided half of said lands.. To this petition the defendants interposed defenses: 1st, A general denial of plaintiff’s title; 2d, The statute of limitations. On the trial,, verdict was rendered against the plaintiff. Judgment on the verdict was affirmed by the district court. It is alleged that, there was error on the trial in the court of common pleas, in the admission of testimony, and in the charge of the court.

      George M. Tuttle, for plaintiff in error.

      B. F. Hoffman, for defendant in error.
   McIlvaine, C. J.

.At the trial in the court of common pleas, after the 'plaintiff liad offered testimony tending to prove in himself the legal title to the property in dispute, by mesne conveyances from Amos Parkhurst, the defendants offered testimony to show in them an equitable title by virtue of a contract of sale from Amos Parkhurst to Luther Parkhurst, made in 1834, shortly before the death of Amos. This testimony was objected to by the plaintiff, but was admitted by the court. And in relation to this testimony the court refused to instruct the jury, as requested by plaintiff, That no contract of sale by Amos to Luther Parkhurst can in this case be relied on as a defense,” but did instruct that, “ Before this equitable defense can prevail, the proof must show you that Amos and Luther, before the former’s death, entered into a contract for the sale of Amos’s share, the terms of which are definitely proven, and the purchase money fully paid, and that Luther was put in possession of Amos’ share before the death of Amos.” _

The rulings of the court of common pleas, in this regard, are alleged to be erroneous. The ground of error is, that the testimony, as matter of defense, was not pertinent to the issue joined between the parties.

Since the adoption of the civil code of 1853, it has been competent for the defendant in an action for the recovery of real estate to plead an equitable title and right of possession in himself. Section 93 provides that “ The defendant may set forth in Ms answer as many grounds of defense, counter-claim and set-off as he may have, whether they be such as have been heretofore denominated legal or equitable, or both.” Under favor', of this provision, it is quite clear that all matters of defense, whether legal or equitable, must be pleaded. And section 92 provides, that A statement of new matter constituting a defense, counter-claim or set-off ” should be- set forth in ordinary and concise language, and without repetition. This rule of pleading, it will be observed, relates to matters of defense, counter-claim and set-off, as distinguished from mere denials, general or specific, of the material allegations of the petition. ■ The latter joins issue- upon the facts stated as the cause of action; the former confesses and avoids. The'pleading of new matter, as a defense, does not join issue upon the facts stated in the petition, but tenders an issue upon the facts stated in the answer, which, if not controverted by .the reply, shall be taken as true, for the purposes of the action. Section 127.

Now, with these principles in view, the true scope and meaning of sections 558 and 559 of the code are apparent. Section 558. In an action for the recovery of real property, it shall be sufficient, if the plaintiff state in his petition that he has the legal estate therein, and is entitled to the possession thereof .... and that the defendant unlawfully keeps him out of the possession.” Section 559. It shall be sufficient in such action, of the defendant, in his answer, deny, generally, the title alleged in the petition, or that he withholds the possession, as the case may be; but if he deny the title of the plaintiff, possession by the defendant shall be taken as admitted.” The rules for pleading here prescribed relate only to cases where the light of the plaintiff as alleged (in his petition, or the fact that the defendant withholds the possession from the plaintiff, is-denied. If, however, these facts cannot be denied, and the defendant relies upon new matter as grounds of defense, as, for instance, an equitable title and right of possession in himself, such new matter must be pleaded in his answer, as required by sections 92 and 93, above quoted.

In the case before us, the plaintiff’s petition was framed under section 558, and the defendant’s answer under section 559. It is true, that the defendant also formally pleaded the statute of limitations, but this was equivalent merely to a denial of the plaintiff’s title as alleged in his petition. Keyser v. Cannon, 29 Ohio St. 359; Rhodes v. Gunn, 35 Ohio St. 387.

No issue was joined, or even tendered, as to the equitable right of defendants under a contract of purchase. If such right had been relied on by defendants, it should have been pleaded, and the plaintiff thereby advised of the nature of the defense, and thus afforded an opportunity to controvert it.

On the trial in-.the court of connnon pleas, the. rule of evi•dence which, requires testimony to be confined to matters in issue was clearly violated. And it was error in the charge of the court to submit to the jury the consideration of a defense which had not been pleaded. The case was not one of immaterial variance between the allegations and the proof, within the meaning of sections 131 and 132 of the code, bnt was one •of departure, by which a defense which was not pleaded at all was allowed to he proved. And in •such case it is impossible for us to say that the plaintiff was not prejudiced.

Other matters are also alleged for error, but it is not considered necessary that they should be reported or discussed.

Tbe district court erred in affirming the judgment of the •common pleas, and tbe judgments of both courts are now reversed and cause remanded to the common pleas for further proceedings.


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    Andrews v. Campbell.
    While the statute allowing parties to contract for ten per cent, interest was in force, 0. executed to B. his promissory note, payable on time, without interest.
    Before maturity, B. negotiated the note to W., who brought an action to recover a balance due thereon, with ten per cent, interest, alleging for that purpose a promise in writing by 0. to that effect, made after maturity, in consideration of an agreement by W. for further time, which had been granted. Held,

    1. The burden of proving a valid modification of the terms of the note, by which, the debtor became liable to the higher rate of interest under the statute, was upon the plaintiff.
    •2. The new promise of 0. to pay interest at ten per cent, until the note was paid, must he supported by a sufficient consideration ; and where it is alleged that the promise was made in consideration of a mutual promise by W. to give time, it must appear that his promise to give time was so definite in its terms as to be enforceable by 0.
    8. The mere fact that in pursuance of his promise, 0. had for several years annually paid interest at ten per cent., and had not been pressed for payment of the principal, does not raise the presumption of such a . pre-existing modification of the original contract, as the statute requires.

      4. Payments of interest, made in pursuance of said promise, while the tern per cent, statute was in force, are binding upon C., but payments-made afterward, in excess of six per cent, are to be applied to the-principal.
    5. The written statements of B., made after be bad parted with the note, and contained in a contract with W. concerning the same, tending to-show the alleged consideration for C.’s promise, are not admissible in. this action against C., though B. was dead, it not appearing that C. was a party to, or bad notice of, said contract between B. and W.

    Error to the District Court of Butler County.
    The plaintiff in error brought an action to recover a balance-due on the following note:
    “ $1,000. Hamilton, April 16, 1851.
    “ Nine months after date I promise to pay to the order of ¥m. Bebb, one thousand dollars, value received, at the Ohio-Life Insurance and Trust Co., Cincinnati.
    “ L. D. Campbell.”
    Which was indorsed and transferred to plaintiff’s intestate,. Wm. E. White, before due.
    He avers that on the 27th of November, 1852, at defendant’s request, White agreed to let him have further time to-pay said note, in consideration whereof the defendant executed the following agreement:
    “ I hereby agree to allow Wm. E. White ten per cent, interest on a note signed by myself and payable to and indorsed by Wm. Bebb, for one thousand dollars, dated April 16, 1851, payable nine months after date, the said ten per cent, to be-, allowed until the same is paid.
    “ L. D. Campbell.
    “ Hamilton, Nov. 27, 1852.”
    It is alleged that by virtue of said agreement, which beeamepart of said note, it bore interest at the rate of ten per cent from and after November.27, 1852.
    ■ By an amendment to his petition, the plaintiff alleges that. White did, in pursuance of said promise by Campbell to pay ten per cent., give and extend time to liim, in consideration of which he paid said interest.
    Sundry credits are indorsed on the note, beginning with January 6, 1853, and ending March 31, 1870.
    The answer claims that these payments, indorsed, were paid as interest at ten per cent., denies the validity of the contract to pay that rate for want of any consideration to support the-defendant’s promise, and denies generally all plaintiff’s allegations touching the agreement to give time for payment of the note.
    Upon this issue the case was submitted to the court. The plaintiff testified -that he was the executor of White, and that, he found among his papers a writing signed by Bebb, the payee and indorser of the note. This paper was offered in evidence by the plaintiff, in support of his case, made by the pleadings, but was ruled out, and to this ruling plaintiff excepted. It reads as follows:
    “ Cincinnati, March 16, 1852.
    “Whereas, I negotiated to Wm. E. White the note of Hon. L. D. Campbell, dated April 16, 1851, for $1,000, payable nine months after date, at the Ohio Life and Trust Co., Cincinnati. And whereas, by reason of fires, &c., Mr. Campbell has not been able to meet said note at its maturity, and asks further time, which Mr. White has consented, with my consent, to grcmt:
    “ Now, I agree that in consideration of said forbearance, that if the said Campbell will not pay to the said White ten per cent, per annum interest on said note, from and after its maturity, I will; and I agree that the mortgage lien shall remain unaffected by said forbearance, and that I will remain surety, as. heretofore, until I give written notice to the contrary, and sixty days thereafter.
    “Witness my hand: Wm. Bebb.”
    Without further testimony by either party, the case was submitted, and the court computed interest on said note at ten per cent, until the repeal of the ten per cent, statute, and after that at six, applying the excess of interest paid after that date, to the payment of principal.
    This judgment was affirmed in the district court. To secure .so much of the same as allows six per cent, interest only after the repeal of the ten per cent, statute, is the object of the present proceeding.

      Harmon de Maxwell and H. L. Morey, for plaintiff in error:
    I. We claim that the writing signed by Bebb, reciting that ■Campbell desired, and White had agreed, to grant an extension ■of time for payment of the note, and that he, Bebb, consented thereto, is competent: 1st. As part of the res gestee — as a link in a chain of circumstances going to prove an extension of tftme. The obtaining of the surety’s consent is always a part of such a transaction on the part of every prudent man. It is inseparably connected with an extension, and with nothing else. While it might not, of itself, prove an extension, it certainly is, when taken in connection with Campbell’s agreement and the acts oí the parties, perfectly convincing that an extension was made. 2d. As the admission against interest of a deceased person who must be presumed to have known the facts of the transaction in question. The decease of Bebb and his signature being admitted, his knowledge of the facts being clearly and necessarily inferrible from the relation he occupied to the transaction, and “the writing being as clearly against his interest, continuing as it did his liability as indorser, we cannot see in what single particular the writing fails to come up to every requirement lor the admission of that class of evidence as laid down in Grreenl. on Ev. 147, and Bird v. Hueston, 10 Ohio St. 418.
    II. Contracts which, though not mutually binding and enforceable, while executory, become so between the parties when executed. Story on Cont. §§26, 448; 5 Mees. & Welsb. 501; L' Amoreaux v. Gould, 7 N. Y. 349; Wright (Ohio), 554; Parsons on Cont. 450; 27 Iowa, 99; L. R. 9 C. P. 16; 17 Me. 303; 9 Barb. 202; 36 Barb. 576 ; 4 Johns. (N. Y.), 237; 4 Me. 387; 9 Penn. St. 183; 1 Doug. (Mich.) 188 ; 2 Bibb (Ky.) 25. The contract in question became binding when executed by Campbell’s paying ten per cent, interest.

      III. We submit that there is neither reason nor authority to’ justify the courts below in crediting upon the principal the excess above six per cent, actually paid. It was simply setting aside a contract permitted by law a/nd executed on both sides. So far as that part of the case is concerned, it makes no difference whether there was any consideration for the agreement or not. That can make no difference after execution. The principle is elementary. It was distinctly recognized in Samyn v. Phillips, 15 Ohio St. 218.

      James E. Campbell and Thomas MilUIam, for defendant in error:
    The agreement of Campbell was not binding for want of consideration. 7 Ohio (pt. 1) 75 ; 17 Ohio St. 165.
    White did not agree to do anything — did not agree to extend the time for any period. He could have sued the next day, and for this reason there was no valid contract to forbear. Our claim is, that whatever time was actually given by White, was so given without any valid agreement, and, as the contract to pay ten per cent, was a new contract, made long after the note was given, and on a separate paper, it must be based upon a new and valid consideration — such a contract as Campbell could have enforced. In the case of a new note, the lending of the money forms the consideration for the promise to pay a certain rate of interest. The consideration is both definite and valuable. But if, subsequently to the giving of the note, the payee agrees to increase the rate of interest, there must be a valid consideration to sustain this new agreement. 3 McLean, 330; 1 Addison on Cont. 11, 12, 18, 28, 35, 41; 2 Blackf. 118; 44 N. Y. 83; Story on Cont. 448; 7 Bush, 10.
    In answ'er to the claim that the court erred in rejecting the naner signed by Bebb, see 1 Greenl. on Ev. § 108, note 2: 10 Ohio St. 428, 429.
   Johnson, J.

By the act of March 14,1850, which took effect May 1, 1850 (48 O. L. '87), “the parties to any bond, bill, promissory note or other instrument of writing, for the payment or forbearance of money, may stipulate therein . . . at any rate not exceeding ten per centum yearly.”

This statute was repealed February 25, 1859, and the repeal took effect April 1, 1859, but by an act of March 31, 1859 (1 S. & 0. 745) the repeal did not affect existing ten per cent, ■contracts, nor such as should be made before the repeal took ■effect.

By the act of 1848 (1 S. & C. 744), all payments of interest above the legal rate were to be treated as payments on the principal, when the note was not in the hands of a bona fide holder, purchased before due.

This note was without interest, and upon its face bore six per cent, after maturity.

The burden of allegation and proof that the contract, as expressed by the note, had been converted to a ten per cent, •contract rested upon the plaintiff.

The court having no other evidence before it, upon the issue made, than the pleadings, found that the contract to pay interest at six per cent, had not been converted into one to pay ten, but following the decision in Samyn v. Phillips, 15 Ohio St. 218, allowed all payments of interest at the rate of ten per cent, made during the existence of the ten per cent, statute to stand as such, and treated all subsequent payments in excess of six per cent, as credits on the principal.

To reverse this judgment two errors are assigned.

1st. That the court erred in ruling out the written agreement of Bebb, found among White’s papers, giving his consent to an extension to Campbell, which it is therein stated White had agreed to give, and reciting that White had, with his consent, agreed to give time to Campbell. *

2d. That the court erred in holding that there was no valid contract changing the rate of interest from six to ten per cent.

1st. As to the rejection of the written statement and agreement of Bebb.

It is dated March 16, 1852, two months after the note was •due, and more than eight months before Campbell’s promise to pay ten per cent., and after B. had parted with his interest in the note.

It appears from the record that Bebb had waived demand, notice and protest, so that, at the time he signed this paper, he was liable on the note as an indorser.

One of the objects of this instrument was to waive any right he might have to be discharged if White should give time on Ihe note.

Another object seems to have been to induce White to grant ■further time to Campbell, who it seems was unable to pay, by neason of losses by fire, &c.; hence he agrees that if Campbell •does not pay the ten per cent., he will. This agreement was ¡signed by Bebb, and was made for the benefit of White.

Bebb is not a party to this action. This paper was one executed to White; Campbell was not a party to it, nor does it appear that he ever knew of its existence until it were offered in evidence. White’s title and ownership of the note was not in issue on the trial, and hence the declarations of Bebb that he had negotiated the note to White, or his statements in favor of White, were not material except to prove the allegation that White had agreed to give time on the note.

■ The. issue to be tried was, whether there was a consideration to support Campbell’s promise of November 27th, that is, whether White’s promise of delay was a consideration for •Campbell’s promise to pay ten per cent.

The statement made by Bebb to White, that he, White, had consented, with his consent, to give time, is brxt the declaration •of a third party, a stranger to Campbell’s agreement, of what White had agreed to do.

It was no part of the res gestee, and was inadmissible in favor •of White for the purpose for which it was offered, namely, to prove a mutual promise by White, in consideration of the promise made by Campbell. In the absence of anything tending to show that Campbell knew of the existence of this agreement of Bebb with White, or that he had acted upon the faith •of it, it was clearly inadmissible to prove that White had promised to delay or give time.

2d. Did the court err in treating the payments made after April 1, 1859 (the date of the repeal of the ten per cent, law), in excess of six per cent., as payments on the principal of the note ?

This depends on the validity of Campbell’s promise to pay ten per cent.

In this promise he says: “ I hereby agree to allow William E. White ten per cent, interest on a note (describing the same) . . . to be allowed until the same is paid.”

The plaintiff alleges that the consideration that made this-promise binding was the promise of White to give time. No' proof of this is offered, and we are asked to presume or imply that such a valid contract was in fact made, from the fact that annual payments of interest were made for several years by Campbell, who enjoyed the benefit of actual delay during the time of these payments.

The statute requires that the contract to pay the increased rate must be in writing, and while it may not be necessary to-express the consideration for the promise in the contract, yet. to make it valid as a change of the terms expressed by the note,, it should be supported by a valid consideration. The fact of' giving time indefinitely, and the payment annually of ten per cent., do not warrant the inference that there ever was any binding obligation pre-existing on the part of White, which was enforceable by Campbell.

Without a definite obligation by White to support Campbell’s promise, the terms of the note are not modified. If he was at liberty at any time to collect the note, as he seems to-have been, there was no statutory change of its terms.

But it is urged that, as the delay was actually granted for a. series of years, the contract became, on the part of White, an executed one, which made Campbell’s promise binding; and reference has been made to a numerous class of contracts, where the rule that the promise of one is void for want of mutuality, is confined to cases where want of such mutuality would leave the promisor without a valid consideration at the Ume he is to perform his promise. L’Amoreux v. Gould, 7 N. Y. 349.

In other words, that Campbell’s promise to pay ten per cent, until the note is paid, though void for want of mutuality, became binding, because time was actually given, as desired by Campbell.

It is undoubtedly true that when the promise is made on certain and definite terms or conditions, open to acceptance, or to be acted upon by the promisee, it becomes a binding promise upon such acceptance or performance, though void for want of mutuality before such acceptance or performance.

Instances of this class of contracts may be found in cases of conditional, optional and gratuitous promises, and also in some forms of guaranty.

In all such cases it is an essential element of the promise that it is based upon terms or conditions, express or implied, which can be accepted and performed. In such cases the execution of these terms or conditions by the promisee constitutes a valid consideration, and from the time of such execution the promise becomes binding.

If Campbell’s promise be examined, it will appear that it is not such as comes within the above rule. He stipulated for no definite time of delay, and none was in fact given. The delay that did occur may have been, and probably was, the result of the voluntary act of White, and not because he was under any legal and valid obligation to grant it. - Again, it does not appear that the act of giving time by White was in exeeution of any contract with Campbell, or of any terms or conditions, express or implied, as the consideration of his promise.

To constitute a valid modification of the terms of the promissory note, there must be a new and valuable consideration moving to Campbell to support his promise. None is shown in this case, and none can be presumed to have existed, from the mere fact that he paid the higher rate from year to year, and that indulgence was granted.

The statute requires that the stipulation to pay ten per cent, must be in the eont/raet for the payment or forbearance of money. A strict construction of o this statute would exclude this subsequent contract or promise of Campbell, made on a separate paper. It does not purport to be a contract for the payment or forbearance of the principal debt, but a supplemental promise to pay a higher rate of .interest on the note.

Such, a contract was, however, sustained in Mueller v. McGregor, 28 Ohio St. 265, where the promise to pay ten per cent.' was in a' supplemental contract, in which there was a promise by the creditor to delay for a definite time in consideration of the promise to pay ten per cent. In that case, it was held, that the original contract was modified as to rate of interest for the time named, but that after the expiration of that time, the original rate of interest governed, except as to payments made at a higher rate before the repeal of the ten per cent. law.

We hold, therefore, that to constitute such a modification of the promissory note as to change it from a six to a ten per cent, note, there must have been a valid contract to that effect; that the burden of proving such contract rested upon the plaintiff, that such a pre-existing contract cannot be implied from the payment of ten per cent, for a series of years in pursuance of a voluntary promise to do so, in th¿ absence of any consideration to support such promise, and that, as the promise by Campbell was not coupled with any definite terms or conditions to be accepted or performed by White, the fact that delay was granted by him for a series of years, does not constitute such a performance or execution of a contract as will make the promise by Campbell, which was void for want of mutuality, binding upon him under the statute.

Judgment 'ajfk'med.