author: Price, J.

text:
    The Globe Insurance Company v. Wayne et al, Executors.

      Contract for common use of elevator, etc. — By two insurance companies occupying adjoining buildings — Each to pay one-half of total expense — Neither party can abrogate the agreement without consent of the other — Vendee of one party can not terminate terms of the contract — Lavo of contracts — Rights of parties.

    On the 30th day of July, 1881, G. and U., two insurance companies, owned adjoining office buildings, the two forming one large structure several stories high, having a common entrance and hallway on the center line dividing the premises; also, a common stairway and skylight.' Considering it necessary to their interests and tire common benefit of both properties, the owners entered into a written contract, wherein they agreed to install an elevator, one-half of its shaft to be on the land of one, and the other half on the land of the other; and that coal bins and water closets should be placed on the different floors on the side owned by U. For the space occupied by the bins and closets, G. agreed to pay U. sixty dollars per annum. It was further provided in the contract, that the elevator should be used for the “mutual accommodation of both of said buildings” to furnish convenient access to the upper floors of the same, and that the coal bins and water closets should be used by both parties for their mutual and common convenience, and ' that all costs and expenses for making such improvements and maintaining them shall be paid — one-half by each party; and it was further provided, that “so long as the buildings remain, each party, its heirs or assigns, shall have the free use in common with the other party, its heirs or assigns, of the premises and the works so made and designated, for the common benefit as above stated, and neither party, its heirs or assigns, shall, without the consent of the other, its heirs or assigns, obstruct, destroy, remove, alter, or in any way injure or incumber the same.” By arrangement between the parties, G. was to pay the expenses of keeping up and maintaining these common conveniences, including the elevator, and render a bill to U. for its one-half of the same. The said improvements were made, and were used in common by G. and U. and all bills paid as agreed upon, until November 23, 1883, when U. sold and conveyed its premises to W., who then and theretofore had full knowledge of the terms of said contract, and he went into possession of his part of said building, with its share of the common improvements made thereunder, and for several years thereafter he paid one-half of said expenses of maintaining and repairing them, including the elevator, all of which was done with the consent and to the acceptance of G. In May, 1900, W. declined to paj’’ for the further repair and operation of the elevator and G. brought suit to recover one-half the expenses incurred in that behalf.

      Held: 1. The contract having been made for the mutual and common benefit of both parties thereto in respect to valuable improvements of their property, and for the common use of both, neither has a right to terminate his liability for half of the expense of maintaining said improvements, without the consent of the other.
    2. W. having purchased the premises from U., with full.knowledge of the purposes and terms of said contract, and of the making of the improvements thereunder, with the consent and to the acceptance of G., became party thereto by novation, and is liable thereon for the performance of the obligations which are imposed on U., his vendor.
    (No. 9627
    Decided January 22, 1907.)
    Error to the Circuit Court of Hamilton County.
    The plaintiff in error, who was plaintiff below, brought an action to recover of Joseph W. Wayne a certain sum of money which the plaintiff alleges is due it under the provisions of a written contract of which the following is a copy:
    “Memorandum of an agreement made this thirtieth day of July, 1881, between the Globe Insurance Company, of one part, and the Union Insurance Company, of the other part, both of Cincinnati, Ohio.
    “The said parties are about to make certain improvements and alterations in the buildings owned by them respectively and now numbered and known as No. 66 and No. 68 West Third street, and situated on the north side of said West Third street, between Walnut and Vine streets, Cincinnati, Ohio, for the more beneficial use of said buildings; and having a common hall or entrance, a common stairway, skylight, etc., for the accommodation of each building, such alterations ■and improvements are to be made for the common use and accommodation of each building.
    “It is proposed to put an' elevator in the area, or rotunda, at the north end of the common entrance way in said buildings, for the purpose of affording, convenient access to the upper stories of both of said buildings, which said elevator is to be used for the mutual accommodation of each of said buildings; it is also proposed to put water closets, coal bins and other conveniences for the use and occupancy of the various parts of said buildings; and because of the fact that the common stairway, used, owned and occupied jointly for the accommodation of both of said buildings, is on the side of the building owned by the Globe Insurance Company, making it impracticable to place such conveniences on that side, such conveniences for the accommodation of both of said buildings- are to be placed in convenient position and with as little inconvenience and waste of room as possible, on the side of the Union Insurance Company, and when so placed are to be held in common and for the accommodation of both of said buildings, the same as the common entrance, the passages, stairway, elevator, or any other conveniences held in common by the two buildings. In consideration of the space occupied by the said water closets, coal bins and other conveniences for the common use and benefit, the said Globe Insurance Company is to pay said Union Insurance Company the sum of sixty dollars per annum.
    “All of said alterations and improvements are to be made under the direction of a joint committee of six persons, each of the above named insurance companies being represented in said joint committee by a committee of three persons appointed by its own board of directors or president; and all contracts for making such alterations or improvements must first have the approval of said committee or a majority thereof, and all costs and expenses for making such improvements and maintaining them and keeping them in repair shall be paid one-half by the Globe Insurance Company, and one-half* by the Union Insurance Company; and so long as the buildings shall remain, each party, its heirs or assigns, shall have the free use in common with the other party, its heirs or assigns, of the premises and the works so made and designated for the common benefit as above stated, and neither party, its heirs or assigns, shall, without the consent of the other, its heirs or assigns, obstruct, destroy, remove, alter, or in any way injure or incumber the same, and if there shall be at any time hereafter any necessary expenses for the benefit of the premises to be used in common, such as necessary repairs and supervision, half the expenses thereof 'shall be paid by each party, its heirs or assigns.
    “This agreement shall be entered of record on the minute book of the proceedings of the board of directors of each, said Globe Insurance Company and said Union Insurance Company, and approved as the action of said boards respectively by a vote thereof and thereon; and when so approved shall be signed by the presidents of the said companies respectively, and said agreement when so signed by the presidents and attested by the secretaries of the said Globe Insurance Company and the .said Union Insurance Company shall be recorded upon the records of Hamilton county, Ohio. And if either .party, its heirs or assigns, shall at any time hereafter on the reasonable request of the other, its heirs or assigns, all or any proper contracts, deeds or conveyances suitable for the more perfect carrying out or intent of this contract, and especially for the more fully vesting in either party the legal title of such structures, work and material are by this contract to be held and used in common, and of such rights and privileges in the premises as by this contract belong to the respective parties.
    “Signed and sealed by the president of the Globe Insurance Company and the president of the Union Insurance Company at Cincinnati, this thirtieth day of July, 1881.
    “(Signed) S. F. Covington,

      “President of the Globe Insurance Company, duly authorised.

    “(Signed) Abram C. Edwards,

      “President of the Union Insurance Company, duly . authorised.

    “Attest: (Signed) B. T. Clemons.
    “(Signed) Joseph T. Blair.”
    This contract is embraced in an agreed statement of facts. The other facts agreed upon are: “That at the time this contract was made the said Joseph W. Wayne was a member of the board of directors of the Union Insurance Company, and had full notice of the making of said contract; that in accordance with the contract the water closets, coal bins, and other conveniences were placed on the side of the building owned by the Union Insurance Company as set forth in the contract, and that the elevator with its fittings was placed one-half on the. side of the Globe Insurance Company’s building and the other one-half on the side of the Union Insurance Company’s building; that the common stairs were situated on the side of the building owned by the Globe Insurance Company. That from the date of the contract until November 23, 1883, the Union Insurance Company and the Globe Insurance Company aforesaid each bore one-half the expense on the following items among others concerning the elevator and other conveniences named in the contract above set out: gas bills, water bills for building and elevator, attention to elevator — i. e., greasing, splicing, etc., janitor service (the duty of the janitor being the care of the common halls, closets and washrooms), the services of a man to run the elevator, brooms and mops for the janitor.
    “That from the twenty-third day of November, 1883, to May 5, 1900, Joseph W. Wayne, original defendant herein, and the Globe Insurance Company each bore one-half the expense of the same items concerning the elevator and other conveniences named in the contract above set out.
    “That up to November 23, 1883, the Globe Insurance Company paid sixty dollars ($60.00) per annum as provided for in the above contract, to the Union Insurance Company for rent of the space so yielded, and that from the twenty-third of November, 1883, up to June 30, 1900, the Globe Insurance Company paid to Joseph W. Wayne, original defendant herein, sixty dollars ($60.00) every year for the rent of space in defendant’s building as provided in the contract.
    “That the Globe Insurance Company has expended eleven hundred and sixty-four dollars and twenty-two cents ($1,164.22), from May 5, 1900, for gas bills, water bills for building and elevator, attention to elevator, which means greasing, splicing, etc., janitor service (the duty of the janitor being the care of the common halls and washrooms and closets), services of man to operate the elevator, brooms and mops for janitor up to third day of August, 1903, and that since that date has expended four hundred and seventy-six dollars and twelve cents ($476.12), for the same objects up to the fifth day of February, 1905, and that since said fifth day of May, 1900, the defendant herein has not contributed to said items of expense, which sums are reasonable sums for the things and services purchased thereby, and also that said service and things were reasonably necessary to maintain and keep in operation the elevator and other conveniences set out in the above contract.”
    On the 23d day of November, 1883, the Union Insurance Company sold and conveyed the premises owned by it and above described to Joseph W. Wayne, his heirs and assigns, for valuable consideration, and he went into possession of the same. The elevator was run up to August 6, 1904; that from 1883 to ■ the 8th of February, 1905, the plaintiff and defendant have been in common use of all the conveniences described in the contract above set forth, except that from and after April 1, 1901, the defendant has not used the elevator, although after said date and up to January, 1905, the plaintiff had tenants on the upper floors of its building, and that defendant had tenants on the upper floors of his building, and he himself occupied an office on the second floor of his building to the commencing of the action, but when he rented to tenants after April, 1901, he gave them notice that they could not use the elevator,-to which they agreed, but in fact they did occasionally use it up to day of the trial.
    The petition set out the above contract and facts as stated. The answer traversed but little of the petition and needed no reply. Afterwards the plaintiff filed a supplemental petition setting up an account which had accrued for similar matters since the filing of original petition. This included expenses of keeping up and operating the elevator. Defendant denied liability on the account. The parties waived a jury and the cause was heard and decided by the court, who found for the plaintiff for a small portion of its claim and rendered judgment for the defendant as to the balance thereof.
    Joseph W. Wayne having, died while the cause was pending, the cause was revived in the name of his executors — the defendants in error. The judgment of the common pleas was affirmed by the circuit court and we have the case on error.

      Mr. A. J.Freiberg, for plaintiff in error.
    The parties contracted to maintain the elevator in the sense of “to pay for its operation.” The contention that the contract meant not that the elevator was to be “run” but simply “maintained” in the sense of “to have in place” is almost too absurd to discuss. The word “maintain,” like every other word in a contract, must receive light from the context. To maintain a stable may, it is true, mean simply to have in place a building of four walls, which looks like a stable; or it may, and usually does, mean to keep a horse or string of horses. To maintain a family does not mean simply to have a family. It necessarily imports the support of a household by the expenditure of money or other efforts— in other words, to keep it going.
    That the use of the word “maintain” is synonymous with “operate” is clear from defendant’s answer.
    There was privity of estate between the parties to the contract.
    To constitute privity of estate, it is not necessary that a transfer of the land by which the disputed covenant is accompanied shall be a grant in fee. It may be a grant of any interest in the land.
    Sims on Covenants, 200; Hall v. Geyer, 14 C. C., 229; Easter v. Little Miami R. R. Co., 14 Ohio St., 48; Norcross et al. v. James et al., 140 Mass. 188; Lydick v. Baltimore & Ohio R. R. Co., 17 W. Va., 427; Baily v. Wells, 3 Wils. 26; Morse v. Aldrich et al., 19 Pick., 449.
    While the plaintiff, therefore, may base its case upon the running of a covenant at law, by reason of there being a full privity of estate such as the law may require, we contend further that in reality privity of estate is not required in Ohio in equity; and to say that it is not required in equity, in our practice, simply means that where there is notice to the defendant of the burden of a covenant when he took his land and paid for it, from his predecessor in title, he took it subject to the burden.

      Shields v. Titus, 46 Ohio St., 528; Cincinnati, etc., Ry. Co. v. Bosworth, 46 Ohio St., 81.
    That equitable considerations are enforced at law under our practice, probably needs no citations. But in Mithoff v. Hughes, 5 C. C., 120, which was an action at law, equitable considerations of notice, etc., were followed. In the latter case, though there was privity of estate, equitable considerations had to.be resorted to for the reason the covenant did not conform to the strict rules of common law in reference to the solemnity required.

      Platt v. Eggleston et al., 20 Ohio St., 414; Stewart v. Aldrich, 8 Hun., 241; Mott et al. v. Oppenheimer et al., 135 N. Y., 312.
    Covenants which run with the land at law or which are enforceable in equity are very often restrictive covenants. But quite as often the covenant contemplates an affirmative action, as in the case ,at bar the covenant contemplates the keeping and operation of an elevator and other conveniences.
    An affirmative covenant (see Sims on Covenants, 168) has been allowed in Dailey et al. v. Beck’s Exrs., 4 Clark (Pa.), 58, a covenant to allow streets; Horn v. Miller et al., 136 Pa. St., 640, a covenant to repair; Morse v. Aldrich et al.,
      19 Pick., 449, a covenant to allow profit; Pierce v. Kne eland et al., 16 Wis., 672, a covenant to pay a fee; Carson v. Percy et al., 57 Miss., 97, a covenant to furnish more land; Martin v. Martin, 44 Kan., 295, a covenant to render support to the grantor; Goudy v. Goudy, Wright, 410, a covenant by a son to render his father support. Cooke v. Chilcott, 3 Ch. Div., 694; Chicago & S. E. Ry. Co. v. McEwen, 71 N. E. Rep., 926; Bald Eagle Valley R. R. Co. v. Nittany Valley R. R. Co., 171 Pa. St., 284; Masury v. Southworth et al., 9 Ohio St., 341.
    Apart from all this discussion as to whether or not the covenant ran with the land, in either law or in equity, whether or not there was privity of estate, etc., we most urgently contend that the defendant himself entered into and adopted the elevator contract by his long acquiescence in the contract according to its minutest terms.

      Kling, Admr., v. Bordner, 65 Ohio St., 86; M. E. Church and Society v. Ashtabula Water Co., 20 C. C., 578.

      Messrs. Sayler & Sayler and Mr. W. H. Burtner, Jr., for defendants in error.
    The only issue in the case is whether the defendant, Joseph W. Wayne, and his estate, represented by his executors, Laura Wayne and William G. Wayne, are liable for the one-half of the expense of operating the elevator after April 1, 1901.
    There is no provision in the contract imposing an obligation upon either party to use the elevator or providing in what manner the expense of running the elevator shall be paid. It would seem to be clear, therefore, that the party using the elevator would be required to bear the expense of running it.
    It is contended upon the part of the plaintiff in error that the word “maintain” is broad enough to cover the expense of running the elevator.
    The word “maintain” does not mean to operate; see Vol. 5 “Words and Phrases Judicially Defined.” And we refer also to Webster’s Dictionary and the Standard Dictionary.
    The right of a joint use of the elevator under the said contract was given to Joseph W. Wayne and his heirs and assigns by the deed from the Union Insurance Company. But there was no obligation imposed on Joseph W. Wayne to use the elevator.
    It is further contended that the agreement in the contract, that each party thereto would pay one-half, is a contract running with the land, and that, therefore, Wayne, the grantee of the Union Insurance Company, is bound by the covenant and must pay one-half of the expenses of running the elevator, although he did not use it.
    We think it is a well-settled principle of law that there must be privity of estate to sustain the application of the doctrine of a covenant running with the land; see Sims on Covenants, pages 17, 28, 195, 197, 198; Mygatt et al., Trustees, v. Coe, 147 N. Y., 456, 467. There is no privity of estate between the parties to the contract in issue.
    The covenant with reference to the payment for making the improvements and maintaining them and keeping them in repair in the contract between the insurance companies was purely personal; it did not run with the land; it was not imposed upon Wayne as grantee of the Union Insuranee Company. Any necessary expenses for the benefit of the premises to be used in common, such as necessary repairs and supervision, shall be paid one-half by each party and its heirs and assigns. But this clearly does not cover the expense of operating the elevator.
   Price, J.

At the date of the contract involved in this case, to-wit, the 30th day of July, 1881, the Globe Insurance Company, and the Union Insurance Company, owned adjoining premises situated on the north side of West Third street, between Walnut and Vine streets, in the city of Cincinnati. The two properties formed one large building, mostly rented for offices, and they had a common hallway through the center, the line of separation of the respective premises running through the center of this hallway from the front to the rear end of the buildings. Each building was at least three stories in height. At that time office room in these buildings was in fair demand, and the two companies, seeking to promote their common interests, and to that end to increase the comfort and conveniences of tenants in their respective buildings, as well as to hold present and attract other tenants, entered into the contract set out in the statement of this case. It was drawn with apparent care and executed with more than ordinary formalities. Its terms were executed by the corporation constructing and placing in the hallway an elevator properly equipped and ready for use, and the location and construction of the coal bins and closets mentioned in the contract. Up to this time, the stairway and skylight were used in common by both proprietors, and this stairway being on the side of the hall owned by the Globe Insurance Company, the coal bins, closets and other conveniences were- placed on the different floors on the side of the hall belonging to the Union Insurance Company. For the space these occupied, the Globe was to pay the Union Insurance Company the sum of $60 per annum. The elevator was installed, one-half on the land of one, and the other half on the land of the other. For the making and maintaining these improvements, the companies were to be equally liable.

Each company performed its part under this contract until the 23 d day of November, 1883, when the Union Insurance Company sold its premises to Joseph W. Wayne, who until then had been a member „of its board of directors, and which relation he sustained when the contract involved was executed. By arrangement between the companies, all bills incurred for the joint operation of the elevator and keeping up the other conveniences provided for, were paid by the Globe Insurance Company and a bill rendered to the other company for its share, which was always promptly paid. And this method of conducting the joint enterprise was continued with Mr. Wayne the purchaser, from the date of his purchase until about the 5th of May, 1900, to which time Wayne, without objection, paid his share of the expenses, but bills were rendered him thereafter for his one-half as before, but he declined to longer pay for the expenses of repair and operation of the elevator. He manifested a willingness to pay his half of maintaining the other conveniences, and in its account rendered him at the regular periods, the plaintiff gave him credit for the sum of $60, agreed to be paid annually by the plaintiff for the use of the space occupied by the coal bins, water closets, etc.

As we understand the case, the real controversy between the plaintiff, the Globe Insurance Company, and Wayne, is over his liability for half the expense of maintaining and operating the elevator after he ceased using it, April I, 1901. This item was considerable when compared with the others, and when a demand for offices in these buildings declined by reason of business leaving Third street for other and higher points in the city, the defendant concluded he would refuse to longer support the elevator. If he could legally do that, he could as well repudiate the contract in any other respect. The lower courts took the view that Wayne could thus free himself from the obligations of the contract notwithstanding the demand of the plaintiff company that he comply with it, as his grantor, the Union Insurance Company, had done, and as he had done from November 23, 1883, when -he became owner, until about May 5, 1900. In so holding, the lower courts committed error. Such a privilege could not have been contemplated by either party to the contract, for all its recitals and provisions point the other way.

The owners of the two properties had a common want to be supplied, and it was relating to improvements of their real estate. One of the things agreed upon as necessary was an elevator to be in the area or rotunda at the north end of the common entrance-way into said buildings, to afford convenient access to the upper stories of - both buildings. The elevator was provided and equipped and placed on the line dividing the two premises, and it was expressly stipulated that this “elevator is to be used for the mutual accommodation of each of said buildings.” The coal bins and water closets, and perhaps some other conveniences, were, by the agreement, placed on the different floors of the Union Insurance Company building, or rather on the side of the halls owned by it.

These so-called conveniences were there placed, the contract says, because “the common stairway used, owned and occupied jointly for the accommodation of both of said buildings, is on the side of the building owned by the Globe Insurance Company, making it impracticable to place such conveniences on that side.” Further, “these conveniences "for the accommodation of both of said buildings are to be placed in convenient position and with as little inconvenience and waste of room as possible, on the side of the Union Insurance Company, and when so placed are to be held in common and for the accommodation of both of said buildings, the same as the common entrance, the passages, stairway, elevator or any other convenience held in common by the two buildings.”

These were in the class of permanent improvements, and they were so retained and used at all times thereafter, at least to April 1, 1901. After providing for the payment of the expenses of making and maintaining these improvements, the contract further provides: “And so long as the buildings shall remain, each party, its heirs or assigns, shall have the free use in common with the other party, its heirs or assigns, of the premises and the works so made and designated for the common benefit as above stated, and neither party, its heirs or assigns, shall, without the consent of the other, its heirs or assigns, obstruct, destroy, remove, alter, or in any way injure or incumber the same, and if there shall be at any time hereafter any necessary expenses 'for the benefit of the premises to be used in common, such as necessary repairs and supervision, half the expenses thereof shall be paid by each party, its heirs or assigns

These provisions are very clear and significant. They recognize the fact and stipulate with reference thereto, that the construction of the elevator shaft and other fixtures necessary to the operation of the elevator, as well as the building of the coal bins, water closets, etc., were additions to the real estate owned by the two companies, and that they were contemplated as permanent improvements of their respective buildings. -Their common or joint use was to be permanent. Like tire common skylight and common entrance hall and upper halls, these improvements and the right to their use would pass with a transfer of the real estate of either party. If the common skylight should be damaged, or the common entrance or other halls should need repairs in order to serve. the common purpose, the law, without any contract to that effect, would hold each company for its share of the expense of restitution or repair. To fix the legal standing of the parties as to the new and common improvements, they distinctly committed their mutual obligations to writing, and stipulated that when executed, the instrument should be duly recorded upon the records of Hamilton county, which, we understand, was done. The contract having fully and carefully provided for the mutual rights and liabilities of each company, neither could abandon performance without the consent of the other, and on refusal to perform the imposed ■ obligation to pay one-half the expense of making and maintaining the common improvements, the defaulting company would be amenable in a court of justice for such default. Any other holding would permit a party to receive a valuable and permanent addition to his estate without incurring any correlative responsibility. The contract is founded on mutuality and could terminate only by mutual consent.

But it is claimed, that however the question might be decided, if it arose between the two insurance companies, the ground of such decision does not exist against Wayne, who succeeded the Union Insurance Company in title by purchase and conveyance of its premises. In other words, the claim is, that the contract does not contain any covenant with reference to the above improvements, that “runs with the land,” and therefore when Wayne ceased to use the elevator he was no longer liable for repairing, operating or maintaining it. In the brief for defendants in error (p. 5) it is said: “We think it is a well-settled principle of law that there must be privity of estate to sustain the application of the doctrine of a covenant running, with the land. There is no privity of estate between the parties to the contract in issue.” And again: “The contract with reference to the payment for making-the improvements and maintaining them and keeping them in repair in the contract between the insurance companies was purely personal; it did not run with the land; it was not imposed upon Wayne as grantee of the Union Insurance Company. Any necessary expenses for the benefit of tire common premises to be used in common, such as necessary repairs and supervision, shall be paid one-half by each party and its heirs and assigns. But this clearly does not cover the expense of operating the elevator.” And so the lower courts found.

We are’ not disposed to discuss the question whether this contract contains a “covenant running with the land” that will make Wayne liable for half of the expense of maintaining the elevator, although it would seem that if there is such a covenant that covers half of the expenses of keeping and maintaining the other conveniences mentioned, — which is not denied — it would also embrace the maintaining of the elevator, which is as much a fixture as the others. But we do not rest our opinion on a covenant running with the land, but are willing to plant it upon the claim of counsel that it was personal as between the insurance companies. Then, what follows as to the situation of Wayne? As before stated, he was a member of the directory of the Union Insurance Company and had an office in its building where and when the improvements were made, and knew of their joint and common use from the time they were put in the buildings. If the contract was not a recordable instrument so that its record would give him notice of its contents, he acquired that knowledge in some way, for in the deed of conveyance which he received from the company, is the following clause, after a description of the premises: “Also all the right, title and privilege secured to said Union Insurance Company under a certain contract or agreement made July 30, 1881, between said Union Insurance Company and the Globe Insurance Company of Cincinnati, which contract relates to the joint use and ownership of certain specific portions of the adjoining premises by said companies respectively.” •

If he acquired all the right, title and privilege secured by that contract, he certainly had knowledge of all of its terms. This is demonstrated by the fact, that for more than six years after he accepted said deed, he' regularly paid the one-half of the expenses of keeping up and maintaining the improvements, including the elevator, and the Globe Insurance Company, knowing of his purchase from the Union Insurance Company, rendered the bills for his half of such expenses to him, and received payment thereof accordingly. These facts constitute more than an adoption of the contract. There was a novation of parties to the contract whereby all the burdens it imposed on the Union Insurance Company became the burdens of Wayne, and all the binding terms }f mutuality creating mutual rights and liabilities before resting on his grantor were assumed by him. He, with the knowledge and consent of the Globe Insurance Company, became the new party in the place of the other company, and he proceeded to perform its part of the agreement and continued so to do for oyer six years, as above stated.

Here we have all the necessary elements of the doctrine of novation of parties, because, after the purchase by Wayne, the Union Insurance Company passed out of all participation in the affairs of the buildings. It is not necessary to cite authorities on the doctrine of - novation of contract or novation of parties to a contract, for they are abundant. _ This- court had occasion to consider the subject in Union Central Life Insurance Co. v. Hoyer, 66 Ohio St., 344. It was there held: (1) That a written contract whereb}^ one party employs another to render services for a fixed period and at a stated rate of compensation, may be discharged as to the employer by the assumption of its obligations to the employe by a third person with the knowledge, consent and to the acceptance of the employe, and such consent and acceptance may rest in parol. (2) The consent -to and acceptance of the terms of such contract of novation, need not be express, but the same may be implied from the facts- and circumstances attending the transaction and the conduct of the parties thereafter.

The principles announced in that case are not new to the legal world and may be regarded as long established law applied to the facts of that case, and they are quite satisfactory here. Hence, if the contract contains no covenant running with the land acquired by Wayne, he, with the consent and to the acceptance of the Globe Insurance Company, became a new party and was substituted for the Union Insurance Company.

Speaking of the clause quoted above from the deed to Wayne, counsel for defendants in error say in the brief (p. 4): “The right of a joint use of the elevator under the said contract was given to Joseph W. Wayne and his heirs and assigns by the deed from the Union Insurance Company. But there was no obligation imposed on Joseph W. Wayne to use the elevator.” Neither was there any obligation imposed upon him by law, to receive sunshine and light from the common skylight, nor to use the common halls or stairways, yet who would say he was not liable for his share of the expense of needed repairs of the common property becaüse he did not use it? And we have not yet been told by counsel why Wayne may be held for half the expenses of keeping up the coal bins, water closets, etc., and not liable for the expenses of keeping up or maintaining the elevator. The nearest approach to furnishing the distinction is found on same page of counsel’s brief, where counsel say: “It is contended on the part of plaintiff in error, that the word ‘maintain’ (in the contract) is broad enough to cover the expense of running the elevator. The word ‘maintain’ does not mean to operate.” And counsel then proceed to experiment with various lexicons where that word is defined, and seem unable to discover in any of them a definition or synonym broad enough to meet plaintiff’s claim. But the parties who executed the contract, perhaps did not examine the lexicons to ascertain the literal meaning of the word “maintain” when standing alone. They knew what they intended and we think that the valuation placed on the word by learned' counsel is entirely too cheap. Why not search for its meaning in the context and other parts of the contract — the subject-matter and the necessities sought to be provided for when they were contracting for a convenient means of lifting their tenants from the lower to the upper stories of their buildings? Why not consider the meaning ascribed by the subsequent conduct of the parties, including the conduct of Wayne himself after he became one of the owners of these common improvements, before we conclude, that to “maintain” the elevator simply means to put it in and have it stand idle at the behest of one of the parties ?

We presume no such construction was ever given the word before the case reached the courts. It was never so construed by any of the parties to the contract where it is found. As late as June 8, 1903, the authorized agent of Joseph W. Wayne, by letter regarding the account urged by the Globe Insurance Company, used this language: “As I cah not rent my rooms on a basis that pays me to run the elevator, I have decined to pay any part of that expense since April 1, 1901. I suggest that we mutually agree to the cancellation of the old agreement of ’8i and make agreement to continue sharing the regular expenses, exclusive of elevator as before mentioned, etc., * * *.” A cancellation by mutual agreement was then regarded as the proper course to end further liability.

On the whole case we are of opinion, that the plaintiff should have recovered in the lower courts, not only in the amount found in its favor, but also for the balance of its claim subject to all proper credits.

The judgments of the lower courts are reversed, and the plaintiff in error, has judgment for the amount of its claim subject to an}' legal credits.

Judgments reversed.

Si-iauck, C. J., Crew, Spear and Davis, JJ., concur.


source: Caselaw Access Project

author: Shauck, C. J.

license: Public Domain

text:
    Ebert v. Commissioners of Pickaway County.

      Liability of county commissioners — For negligence in keeping road or bridge in repair — Section 84s, Revised Statutes — Interpretation of statute — Commissioners not liable for damages from stone pile, when.

    Consistently with the rule that statutes in derogation of the common law should not be extended beyond the natural meaning of their terms, the amendment of April 13, 1894, of Section 845 of the Revised Statutes that “any such board of county commissioners shall be liable in its official capacity-for any damages received by reason of its negligence or carelessness in keeping any such road or bridge in proper repair” can not be interpreted as creating a liability for injuries sustained by one whose horse takes fright at stones which the commissioners had collected by the road-side for the purpose of repairing a road or bridge there being no defect in either road or bridge contributing to the injury.
    (No. 9871
    Decided January 22, 1907.)
    Error to the Circuit Court of Pickaway County.

      Plaintiff brought suit against the commissioners in the court of common pleas to recover on account of personal injuries which had resulted to her from being .thrown from her buggy when her horse was running away, it having taken fright at stones which the commissioners had caused to be collected at a bridge on a pike controlled by the defendants. Her petition alleges that the horse was gentle, that it took fright at rows of large sandstone blocks which had been piled upon either side of the highway near the bridge, the piles being within eighteen feet of each other, alleging that the commissioners “thereby rendered said highway out of repair and unsafe for public travel.” The petition alleges no defect in either the highway or the bridge. In the court of common pleas a demurrer to the petition was sustained and the petition was dismissed. That judgment was affirmed by the circuit court.

      Mr. George B. Bitser; Messrs. Abernethy & Fulsom and Mr. Frank N. R. Redfern, for plaintiff in error, cited and commented upon the following authorities:

      Riggs, Gdn., v. Palmer et al., 115 N. Y., 506; 12 Am. St., 819; Barrett & Caswell v. Pulliam, 77 Ga., 552; Steere v. Brownell, 124 Ill., 27; Henry & Coatsworth Co. v. Evans et al., 97 Mo., 47; Bennett v. American Express Co., 83 Me., 236; 23 Am. St., 774; Barbour v. City of Louisville, 83 Ky., 95; Funk, Admx., v. St. Paul City St. Ry. Co., 61 Minn., 435; 52 Am. St., 608; Harris v. Reynolds et al., 13 Cal., 514; Nelson v. State, 111 Wis., 394; 87 Am. St., 881; Admx. of Tracy
      v. Admr. of Card, 2 Ohio St., 431; Lessee of Burgett v. Burgett, 1 Ohio, 480; State, ex rel., v. Harmon, 31 Ohio St., 250; Moore v. Given, 39 Ohio St., 661; Johnson v. State, 42 Ohio St., 207; Cincinnati Gas Light & Coke Co. v. Avondale, 43 Ohio St., 257; Sawyer v. State, ex rel., 45 Ohio St., 343; Henry v. Trustees, 48 Ohio St., 671; Endlich on Interpretation of Statutes, Section 295; Cross v. Armstrong, 44 Ohio St., 613; State, ex rel., v. Brewster, Auditor, 44 Ohio St., 249; Billings v. Dressler et al., Commissioners, 5 N. P., 114; Reading Township v. Telfer, 57 Kan., 798; Baker v. North East Borough, 151 Pa. St., 234; Morse et al. v. Town of Richmond, 41 Vt., 435; Section 41, Chapter 25, Vermont Statutes; Bennett v. Fifield, Treas., 13 R. I., 139; Winship v. Enfield, 42 N. H., 197; Chamberlain v. Enfield, 43 N. H., 356; Bartlett et al. v. Hooksett, 48 N. H. 18; Dimock v. Town of Suffield, 30 Conn., 129; Ayer v. City of Norwich, 39 Conn., 376; Young v. City of New Haven, 39 Conn., 435; Foshay v. Town of Glen Haven, 25 Wis., 288; Hewison, Admx., v. City of New Haven, 34 Conn., 136; Section 1442, How. Stat.; Nye v. Dibley et al., 93 N. W. Rep., 524; York v. Inhabitants of Athens, 58 Atl. Rep., 418; Clinton v. Howard et al., 42 Conn., 294; North Manheim Township v. Arnold, 119 Pa. St., 380; Wilson v. Town of Spafford, 57 Hun., 589; Kelsey v. Town of Glover, 15 Vt. 708; Burrell Township v. Uncapher, 2 Am. St., 664; Commissioners v. Sisson, 28 N. E. Rep., 374; Card et al. v. City of Ellsworth, 65 Me., 547; Hixson v. Burson et al., 54 Ohio St., 485; State, ex rel., v. Davis et al., 55 Ohio St., 22; State v. Bader et

      al., Commissioners, 56 Ohio St., 720; Mott et al. v. Hubbard, Treas., et al., 59 Ohio St., 211; State, ex rel., v. Buckley et al., 60 Ohio St., 273; Village of Cardington v. Admr. of Fredericks, 46 Ohio St., 442; Smith v. Sherwood Township, 62 Mich., 159; Monongahela City v. Fischer, 111 Pa. St., 9; Kingsbury v. Inhabitants of Deadham, 13 Allen, 186; Hubbard v. City of Concord, 35 N. H., 52; Upton v. Town of Windham, 75 Conn., 288; 53 Atl. Rep., 660; Shearman & Redfield on Negligence, Section 369a; 1 Harris on Damages by Corps., Section 87, p. 99; Elliott on Roads and Streets, pp. 449 and 450; Black’s Law & Prac., Accident Cases, Section 44; Thomas on Negligence, 1150 and 1151: 2 Dillon on Municipal Corps., Section 1011; 4 Am. & Eng. Ency. Law, 27; Commissioners v. Mighels, 7 Ohio St., 109; Alexander et al., Commissioners, v. Brady, 61 Ohio St., 174; Commissioners v. Coffman, Admx., 18 C. C., 254; 60 Ohio St., 527; Chicago, etc., Ry. Co. v. Leachman, 161 Ind., 512; 69 N. E. Rep., 253; Neal v. Wilmington, etc., Electric Ry. Co., 53 Atl. Rep., 338; Pittsburg, etc., R. R. Co. v. Maurer, 21 Ohio St., 421; Trustees of Burton Township v. Tuttle et al., 30 Ohio St., 64; Little Miami R. R. Co. v. Commissioners, 31 Ohio St., 338; Cincinnati & Harrison Turnpike Co. v. Hester, 12 C. C. 350; 5 C. D., 185; Lawrence R. R. Co. v. Commissioners, 35 Ohio St., 1; Sections 845, 1536-131 and 4889, Revised Statutes.

      Mr. Charles '. Gerhardt, prosecuting attorney, and Mr. Clarence Curtain, for defendants in error, cited and commented upon the following authorities:

      16 Ency. Law, 1st Ed., 415; Alexander et al., Commissioners, v. Brady, 61 Ohio St., 178; Commissioners v. Mighels, 7 Ohio St., 109; Finch v. Board of Education, 30 Ohio St., 47; Dunn v. Agricultural Society, 46 Ohio St., 93; State, ex rel., v. Commissioners, 11 Ohio St., 190; Brower et al. v. Hunt et al., 18 Ohio St., 341; Agnew v. City of Corunna, 55 Mich., 428; 54 Am. Rep., 383; McArthur v. City of Saginaw, 58 Mich., 357; 55 Am. Rep., 687; Monongahela City v. Fischer, 111 Pa. St., 9; 56 Am. Rep., 241; Hubhard v. City of Concord, 35 N. H., 52; 69 Am. Dec., 520; Kingsbury v. Inhabitants of Deadham, 13 Allen, 186; 90 Am. Dec., 191; Pittsburgh, etc., R. R. Co. v. Pittsburgh, 80 Pa. St., 72; Century Dictionary, Vol. 6, 5080; Cooley on Torts, 617; Schroeder v. Multnomah County, 76 Pac. Rep., 772; McFerren v. Umatilla County, 27 Ore., 311; 40 Pac. Rep., 1013; Morse et al. v. Town of Richmond, 41 Vt., 435; Chamberlain v. Enfield, 43 N. H., 356; Hewison, Admx., v. City of New Haven, 34 Conn., 136; City of Vandalia v. Huss, 41 Ill. App., 517; Foshay v. Town of Glen Haven, 25 Wis., 288; Sharp v. Township of Evergreen, 35 N. W. Rep., 69; Bartlett et al. v. Hooksett, 48 N. H., 18; Nye v. Dibley, 93 N. W. Rep., 524; York v. Inhabitants of Athens, 58 Atl. Rep., 418; North Manheim Township v. Arnold, 119 Pa. St., 380; Card v. City of Ellsworth, 65 Me., 547; Commissioners v. Coffman, Admx., 18 C. C., 254; 60 Ohio St., 527; Village of Cardington v. Admr. of Fredericks, 46 Ohio St., 442; Trustees v. Tuttle et al., 30 Ohio St., 62; Pittsburgh, etc., R. R. Co. v. Maurer, 21 Ohio St., 421; Little Miami R. R. Co. v. Commissioners, 31 Ohio St., 338; Cincinnati & Harrison Turnpike Co. v. Hester, 12 C. C., 350; Sections 845, 4889, 4891, 4941-1, 4941-2 and 4941-3, Revised Statutes.
   Shauck, C. J.

It is conceded that the judgments below are right unless the facts alleged in the petition bring the case within the amendment of Section 845 of the Revised Statutes, passed April 13, 1894 (91 O. L., page 142), creating and defining a liability of the county commissioners for negligence. Prior to that date it was recognized as established by repeated decisions that there was no such liability on the commissioners or the county for any negligence of the commissioners. A limited liability was then imposed by the amendment of the statute defining the duties and powers of the commissioners, the pertinent portion of the amendment being: “And any such board of county commissioners shall be liable in its official capacity for any damages received by reason of its negligence or carelessness in keeping any such road or bridge in proper repair.” The scope of this amendment was under consideration in The Board of County Commissioners of Morgan County v. The Marietta Transfer & Storage Company, ante, 244, where it was held, for obvious reasons, that, the amendment is within the rule that statutes in derogation of the common law should not be extended beyond the plain meaning of their terms. Without repeating what was there said in support of that view it may be taken as the correct view of the scope of this amendment. The liability which the legislature has created is for negligence or carelessness in keeping a road or bridge in proper repair. No broader effect can be given to the amendment without disregarding the rule stated.

The petition contains no allegation that either the road or bridge was out of repair or in a defective condition, unless we depart from the established rules of pleading and give effect to an averment which is plainly argumentative. The fact alleged against the commissioners is simply that they caused to be piled upon either side of the roadway the stones at which the plaintiff’s horse took fright. There is no legal significance in the averment that they “thereby rendered said highway out of repair.” The act alleged is therefore not within the plain, natural meaning of the words which the legisature has employed to indicate the enlargement of the commissioners’ liability which it intended.

The rule by which courts must ascertain the scope of statutes in derogation of the common law excludes all conjecture respecting the legislative intent. Even if it were not so we could not conjecture that the makers of the statute would have included the present case within the liability created if the case had been in their minds.' It may be assumed that the commissioners had collected these stones for the repair of the bridge and roadway in the proper discharge of the duty which the statute laid upon them. It is sufficient that no averment of the petition excludes that assumption. It would not be respectful to the legislature to assume that it intended that while the commissioners are engaged in the discharge of that duty the taxpayers of the county should be insurers of the lives and limbs of those who forget or ignore the long and well-known fact that “a horse is a vain thing for safety.” All the averments of the petition should be considered together, and the allegation 'that the horse which the plaintiff drove was gentle will not mislead if regarded in the light of what is alleged to have occurred.

Judgment affirmed.

Price, Crew, Summers, Spear and Davis, JJ., concur.


text:
    Watson v. Lamb et al.

      Contract to deliver "my hogs” — Parol testimony may show all hogs - not delivered — But may not vary written agreement.

    In an action to recover damages for alleged failure of the vendor to deliver hogs according to the terms -of a written contract in which the subject of the sale is designated as “my hogs,” the plaintiff may introduce parol evidence to show that the defendant did not deliver all of his hogs, but not for the purpose of changing the terms of the written contract into which the parties entered.
    (No. 9302
    Decided January 22, 1907.)
    Error to the Circuit Court of Fairfield County.
    The defendants in error brought suit in the court of common pleas to recover upon two causes of action for the alleged failure of Watson to deliver to them the number of hogs required for the performance of two written contracts of sale, each of which contracts was counted upon in their causes' of action. In the first cause of action they alleged that on January 24, 1901, Watson, in writing, agreed to deliver to them in the last ten days of the following September sixty-five hogs at the agreed price of five cents per pound, but upon the condition that if his hogs should die from cholera both parties should be released from the obligations of their contract. They attached to their petition what purported to be a copy of the contract containing a stipulation for the delivery of sixty-five hogs at the time stated, and they averred that in “said written contract, as it now appears in the memorandum book of the defendant, the weight of said hogs is not stated, but it was to be an average of not less than two hundred pounds each¡” 1 They, further averred that the defendant delivered thirty of said hogs, but* without excuse failed- and refused to deliver the remaining thirty-five. The allegation of the petition as to the minimum weight of the hogs required by that contract appears to have been conceded- for- the purposes of the trial.
    In their second cause of action they alleged that on May 18, 1901, the defendant in writing agreed to deliver to them in the last half of January, 1902, eighty hogs of an average weight of not less than one hundred and fifty pounds and that he delivered only seventeen thereof, failing and refusing without excuse to deliver the remaining sixty-three. In this cause of action they alleged that the copy of the contract counted upon is attached to the petition. A copy of a contract is so attached to the petition, but this stipulation is not in accord with the allegation of the petition, since it shows the subject of the contract to be “my hogs,” without any stipulation as to their number.
    In his answer to the first cause of fiction Watson denies that he contracted as therein alleged. He alleged that the subject of the contract was described as “my hogs” in the written contract into which the parties had entered, without any stipulation as to their number, and that he had fully performed the contract as made. Answering the second cause of action, he alleged that he had contracted only with reference to the hogs mentioned in the agreement attached to said petition (“my hogs”), and that the seventeen hogs which he delivered were all he had of the required weight.
    Replying,’ the plaintiffs denied all the allegations of the answer except those 'which, in. the petition, were expressly admitted to be true. .On the trial of the case the plaintiffs themselves offered in evidence the contract relating to the first delivery of hogs as it was written in the bopk of the defendant, and in that contract he agreed to. deliver “my hogs,” there being no mention of the definite number of sixty-five hogs, as alleged in the first cause of action • in the petition; or of any other number. Against the objection of the defendant the plaintiffs were permitted to introduce evidence tending to show that in the conversations leading up to. the making of the written contracts the defendant proposed to sell to the plaintiffs the definite numbers of eighty hogs and sixty-five hogs, and that those numbers were in fact the subject of the contracts. In the instructions given to the jury they were authorized to consider such declarations, if made, as measuring the contractual obligations of the vendor. The court refused to instruct the jury as requested by the defendant that he was bound only to deliver such of his hogs as by prudent, reasonable and proper feeding could be brought to the required weight. The jury found for the plaintiffs on both causes of action. A motion for a new trial was overruled and judgment was entered on the verdict. That judgment was affirmed by the circuit court.

      Mr. C. W. McCleery and Mr. W. K. Martin, for plaintiff in error.
    An examination of the facts in this case will show that the court submitted to the jury the question of the interpretation, or construction, of both written contracts sued upon.
    The submission of this question to the jury we contend was error.
    In the trial of such an action the interpretation of the instrument belongs to the court, and it is error to submit its construction to the jury. Monnett v. Monnett, Admr., 46 Ohio St., 30; Beach on Modern Law of Contracts, Vol. 1, Section 743; Wason v. Rowe, 16 Vt., 525; Barton v. Gray, 57 Mich., 622; Chicago Cheese Co. v. Fogg, 53 Fed. Rep., 72; Dwight et al., Exrs., v. Germania Life Ins. Co., 103 N. Y., 341; Brady et al., Exrs., v. Cassidy et al., 104 N. Y., 147.
    The second ground upon which the plaintiff in error relies for a reversal is that the court infringed and violated the broad rule of parol evidence and permitted testimony to be introduced and considered by the jury that varied and contradicted the plain meaning of a written contract.

      This error arose out of the attempt to explain the words “my hogs,” as used in the contract, and for the purpose of this argument both contracts may be taken together as reading “my.”
    The case hinged upon the meaning to be given to this one word. The plaintiffs below and the defendants in error contended that under the one contract it meant sixty-five hogs and under the other contract eighty, and this because, as they alleged, those numbers represented what hogs the parties had intended to sell. To prove this allegation the plaintiffs introduced the testimony, over the objection of counsel for defendant, of plaintiffs and of bystanders who were present at the time the contract was made and who heard the conversation leading up to it.
    It is in the admission of this testimony that the error lies.
    The defendant contended that “my” meant just what it said, that is, what it would be understood to an ordinary man to mean when used in such connection. A person in speaking of “my hogs” would mean the hogs he then had or would have at the time to. which the remark referred.
    The rule of law that parol evidence is not admissible to vary or contradict or alter the plain meaning of a written instrument, is too well and wisely established to require a lengthy citation of authorities in its support. Tuttle v. Burgett's Admr., 53 Ohio St., 498; First National Bank v. Central Chandelier Co., 17 C. C., 443; Thompson Ohio Trial Evidence, see Section 405 and Ohio cases cited thereunder.
    In order to justify the admission of parol evidence to show that “my” meant something else than ordinarily, .and to explain and construe it, the court ruled and so charged the jury that “my” as used in these contracts is ambiguous.
    Now, then, if the word “my” is ambiguous in a legal sense, the evidence to explain it is properly admitted and the argument of the plaintiff in error on this point fails, for the rule of parol evidence above recited is subject to an exception as well established as the rule itself, namely, that evidencé outside the contract is admissible to explain a latent ambiguity therein. Baldwin Quarry Co. v. Clemens, 38 Ohio St., 587; Beach on Contracts, Vol. 1, Section 742, 3-744.
    There are known to the law two kinds of ambiguities, patent and latent. It is not and can not be contended that there is any patent ambiguity here. If any, then it is a latent one.
    The definition of a latent ambiguity has been given by this supreme court in Webster & Hubbard v. Paul, 10 Ohio St., 531-4, as “where you show that words apply equally well to two different things or subject-matters,” or a latent ambiguity is one which arises out of a writing perfectly clear on its face, but which is -shown by parol evidence to be equally applicable to either one of two different things or subject-matters.
    The application of this rule is found and clearly illustrated in Quarry Co. v. Clemens, supra; Macdonald v. Longbottom, 102 Eng. Com. Law. 977; Hart v. Hammett, 18 Vt., 127.
    The parol evidence rule itself applied and not the exception: Elliott, Vol. 1, 605; Beach on Modern Law of Contracts, Vol. 1, Section 714; Johnson v. Pierce, 16 Ohio St., 473; Ormsbee v. Machir & Renick, 20 Ohio St., 295.

      We contend that the contract reading “my hogs” was one for the sale of an indefinite quantity of determinate chattels. The quantity varied, being dependent upon how many hogs Watson could in good faith bring to maturity to comply with the weight required at the time of delivery; the chattels were determinate in being Watson’s hogs.
    By the admission of this parol testimony the contract was transformed into one for the sale of a definite quantity; that is, any sixty-five or eighty hogs that Watson could gather together, agreeable to the contract specifications. He could have delivered any hogs and not necessarily his hogs, and certainly not necessarily all his hogs..
    Therefore, this testimony contradicted the contract as to quantity and changed the contract by extending it from the sale of determinate chattels to the sale of indeterminate chattels.

      Mr. M. A. Daugherty and Mr. Thomas H. Dolson, for defendants in error.'
    Let it be conceded, that, in all cases where parol evidence can not be received and proof of surrounding facts and circumstances not admitted, the court must interpret the contract. There is no dispute about that rule. But what is the rule when the trial is to the jury and parol evidence is admissible, under the rules of law, to arrive at the true intention of the parties to the agreement? In such a case does court or jury interpret the contract? The answer is plain. When the issue is a jury one, the jury decides and in that sense interprets the contract. When the issue is tried to the judge, he must answer and therefore construes the contract. It will hardly be claimed that on trial to a jury, the parol testimony being conflicting, the judge should construe the contract, when ambiguous in its terms or aided in its meaning by the light of extrinsic facts and circumstances. Beach on Modern Law of Contracts, Section 743.
    This is the course pursued by the court here in submitting to the jury whether the parties intended by the word “my” only such hogs of the defendant’s own raising as might by proper care and feeding meet the weight required, as contended by defendant, or whether they intended the sixty-five and eighty hogs respectively claimed by the plaintiffs.
    It is not insisted that the court submitted any other term of the contract to the interpretation of the jury, save and except the number of hogs intended by the parties to be the subject-matter of their contract. Vol. 9, page 784, Cyclopedia of Law and Procedure (Cyc.).
    Whenever parol evidence is admissible, or whenever surrounding circumstances are competent to be related to the jury, and the case is a jury case, then the jury construes the contract to ascertain its meaning. Beach on Modern Law of Contracts, AVI. 1, 244; Ginnuth et al. v. Blankenship & Blake Co., 28 S. W. Rep., 828; Brown & Co. v. M’Gran, 14 Pet., 479.
    It must be remembered that the only question or term of the contract submitted to the jury was as to the meaning of the term “my” — what hogs did the parties intend and mean when they used that term. No other portion, term, provision or word of the contract was left to the jury for its construction except this one word “my.”
    The court did interpret the contract in every respect except this one word. If the evidence introduced was competent, then surely the jury-must interpret, because the evidence is submitted to it.
    Did the court err in allowing the parol evidence of the contemporaneous declarations of the parties to be introduced, or statements made by them in their prior negotiations leading up to the signing of the contract, showing' what definite and specific number of hogs was by them understood and intended to be sold, and delivered ?
    Watson meeting Lamb, in Lancaster on the 24th of January, requested him to sign it, which he did, writing on Watson’s memorandum book in pencil. That a carload, or sixty-five hogs, was the number agreed upon by the parties is beyond all question.
    The testimony is equally convincing that the parties intended and understood the number to be delivered under the contract of May 18, 1901, was eighty.
    Watson sold and delivered twenty hogs to David Ewing in the last half of October at $6 per hundred.
    It is clear from the examination of the record that Watson had sixty-five hogs when he made the first contract and eighty when he made the last contract. If this be true — and it is — the verdict and judgment below are right and should not be disturbed, even though an incorrect statement of law might have been announced to the jury, but the law was correctly given.
    It is undoubtedly the law that in a suit on a written instrument which has been altered, no notice of the alteration need be taken in the pleading. The petition will state the contract as it was written and signed. If for no other reason, the testimony of the witnesses as to the number of hogs intended under the contract of January 24, 1901, would be competent on the question of alteration. The number agreed upon would be properly offered in evidence on that issue.
    But if the contracts were both written “my,” testimony of the number would be competent on the meaning of that uncertain, indefinite and ambiguous term. What did the parties, mean and intend by the use of that word?
    The oral evidence did not contradict, or change, or alter, or add to the contract: it only explained and developed the meaning of one of the words of the contract. It identified the subject-matter and applied this indefinite and uncertain term “my” to its appropriate object. Ormsbee v. Machir & Renick, 20 Ohio St., 295; Macdonald v. Longbottom, 102 Eng. Com. Law, cited with approval in Baldwin Quarry Co. v. Clements, 38 Ohio St., 587, is decisive of the case.
    The admissibility of' this oral evidence rests firmly on the ground that it made plain and clear the meaning the parties intended to attach to that expression of the contract. Beach on Modern Law of Contract, Vol. 1, Section 740; Shore v. Attorney-General, ex rel., 9 Clark & F., 355; Masters v. Freeman & Zent, 17 Ohio St., 323; Thompson’s Trial Evidence, Sections 408, 9-11; Abbott’s Trial Evidence, pages 360-361, paragraphs 4 and 5; Stephens’ Digest Law Evidence, page 362; Hildebrand v. Fogle, 20 Ohio, 147.
    An instructive case on the question is found in
      Royal Ins. Co. v. Walrath, 17 C. C., 509, 514, 515, where many cases are cited; Elliott on Evidence, Sections 597 and 602.
   Shauck, C. J.

Some doubt and controversy should have been eliminated from the case by an instruction to the jury to regard the written contract introduced as the contract which the parties had made for the first delivery. Not only did the plaintiffs themselves introduce that contract in evidence, but their claim that it had been changed after its execution did not meet the test of cross-examination nor the evidence offered to show that the contract remained as it had been executed. The case presented a single question for the jury to determine, and it was common to both causes of action. That question was fairly stated in the instruction which the defendant requested and the court refused. Did the defendant deliver to the plaintiffs all of the hogs which he had which might by proper feeding and care be brought up to the required weights by the times stipulated for their delivery? To establish the claim of the plaintiffs that he had not done so, parol evidence was competent, for to that extent the phrase “my hogs” which the parties used in making the contract to designate its subject was ambiguous. But there is no justification for the admission of parol evidence to show that the parties made a contract different in terms from that which they had written and signed, nor for the instruction given to the jury that they might consider that evidence in determining what contract the parties had made, nor for the refusal to give the requested instruction referred to. Parol evidence was not competent to vary the terms of the contract, although it was competent to apply the terms of the contract to its subject. The wisdom of this rule could hardly be better illustrated than in the present case. The vendor was not a dealer in hogs, but was a farmer and raiser of hogs. The vendees were dealers in hogs, and they were contracting with respect to the marketing of the hogs which the vendor might produce upon his own farm. Not only is this implied by the terms used in the contracts, but in one of them it is expressly stipulated that if the vendor’s hogs should die both parties should be released from the obligations of the contract. It is plain that the understanding of the parties with respect to the subject of the sale was not more definite than the phrase which they employed to designate it. They were contracting only with reference to the vendor’s hogs, and the number of them which could with proper care and feeding be. brought to the minimum weight designated by the times fixed for delivery could not be precisely known. Because it could not be precisely known it could not be precisely stated. It is true that in other portions of the charge the rules of law respecting the conclusiveness of written instruments were correctly stated to the jury, but such abstract statements could not .be an effectual antidote against the concrete errors referred to. It is obvious that a very simple case was complicated by the persistent efforts of the plaintiffs upon the trial to expand it beyond its legal dimensions.

Judgments reversed.

Price, Crew, Summers, Spear and Davis, JJ., concur.


author: Davis, J.

text:
    Moore v. The Indian Camp Coal Company. Patton v. The Emma Coal Company.

      Sale of mineral lying under surface — Title obtained by owner, an estate in fee — Sale carries right to remove strata, etc. — Space left by removal of mineral, etc., belongs to mine owner — If such user does no injury to surface — Law of contracts — Right of property.

    I..When there has been a sale of the mineral lying under land and a severance of the estate in the mineral from the estate in the surface, the title thus obtained by the owner of the mineral is an estate in fee, which terminates when the mine has been exhausted.
    2. Such a sale of the mineral and severance of estate carry the right to remove or use so much of the containing strata, above and below, as may be reasonably required for the proper mining of the mineral.
    3. When there are no restrictions in the grant, reservation or exception which creates the estate, the space which may be left by the removal of the mineral and by the removal of so much of the containing strata as may be reasonably required for the operation of mining, remains a part of the property of the mine owner until the exhaustion of the mine, and may be used by him during the continuance of the estate as he may see fit, provided that such user does no injury to the surface; and this includes the right to haul mineral and drain water through such space from other mines.
    (Nos. 9674 and 10150
    Decided February 5, 1907.)
    No. 9674, error to the Circuit Court of Guernsey County.
    No. 10150, error to the Circuit Court of Jackson County.
    The case of Moore v. The Indian Camp Coal Company originated in the court of common pleas of Guernsey county with a petition for an accounting and for a perpetual injunction against the defendant, among other things, from using for the transportation of coal from other lands any of the entries or channels driven in and under plaintiff’s premises. The Coal Company defended its right to haul coal from other lands through the mines underlying the plaintiff’s premises under a grant to James Glenn and others, their heirs and assigns, of all the coal in and under a certain ninety acres of land, more or less, including the premises of the plaintiff, together with the exclusive right to enter thereon for the purpose of mining or operating for coal, to open mines, sink and erect all needed air shafts, erect, maintain and remove all structures and machinery necessary for mining, production and storage of coal. The hearing in the court of common pleas resulted in a finding in favor of the Coal Company upon the issue as to the right to haul coal from adjoining mines, and the court made the following finding of facts: “8. At the beginning of this suit and for a long time prior thereto, defendant knowingly was hauling through and under the lands described in the petition, by means of the entries of its mines thereunder, coal from adjoining lands, owned by persons other than plaintiff or said Nelsons, or either of them. Said entries under plaintiff’s lands, through which said hauling has been done, have been made through the stratum of coal, which is from four to five feet in height, and said entries have been made by defendant higher than the height of said coal by removing overhead the strata overlying the coal and by removing below the strata underlying said coal; and said haulage has been done, and at the beginning of this suit was doing, through said entries, upon tracks laid by defendant, in and upon the strata underlying said coal, the whole of the coal in said entries having been removed by defendant. Said hauling was done without the consent and against the will of the plaintiff. Unless the facts stated in this respect show damage or injury to the residue of plaintiff’s said lands from such haulage, there is no evidence th'at such hauling has done or is doing or will do, or has caused or is causing or will- cause any damage or injury to said residue.” Upon this finding the court rendered judgment in favor of the defendant; as to the right of hauling through said mines from adjoining premises. Upon an appeal to the circuit court, that court made the same finding as was made in the court of common pleas, and likewise rendered judgment for the defendant, and to reverse the judgment of the circuit court the case is brought to this court.
    The case of Patton v. The Emma Coal Company comes, up on a petition in error to reverse the ’ judgment of the circuit court of Jackson county, and also the judgment of the court of common pleas, upon a' demurrer to the petition involving the same question as the preceding case. The grant in .this case under which the Emma Coal Company defends is a grant by Nancy M. Sutherland, as the sole devisee of T. P. Sutherland, deceased, and James Tripp, by which the grantors sold and conveyed in fee simple to The Emma Coal Company all the coal remaining on said quarter section described therein, and all the rights and privileges once excepted and reserved by T. P. Sutherland and James Tripp aforesaid in their deed to Caroline Nunnally, and by virtue thereof the Company has ever since the 24th of January, 1898, claimed the right to use and occupy the entry or way under the lands of the plaintiff for hauling coal from adjoining mines. The grant aforesaid to the said Caroline Nunnally is as follows: “Excepting all the stone coal underlying said land and excepting ten acres off of the east side of said quarter section and so to be selected and surveyed off as to include all the buildings belonging to the Alice Company, and the coal banks and railroad switch and to extend north on the east line far enough to include such buildings, banks and railroads with the privileges also of opening other mines to mine and remove said coal with air shafts and the use of all roads belonging to said lands both ways from said mines as now opened or hereafter established.” The coal has not been exhausted in said grant; but the petition in this case alleges that the Emma Coal Company has' been, and is now, making use of old entries and excavated space under plaintiff’s land for the purpose of hauling coal and piping water from other mines, without the plaintiff’s consent and against her protest. The court of common pleas sustained the demurrer to the petition and the circuit court affirmed that judgment.

      Mr. Fred L. Rosemond and Messrs. Brenan & Middleszvart,z, for Moore, plaintiff in error, cited and commented upon the following authorities:

      City of Pomeroy v. Buckeye Salt Co., 37 Ohio St., 520; Baker v. Rice, 56 Ohio St., 463; 2 Washburn on Real Property, Chap. 1, par. 16, p. 288; Meredith v. Frank et al., 56 Ohio St., 489; Spencer v. Curtiss, 15 Conn., 39; Robinson v. Clapp, 65 Conn., 365; 29 L. R. A., 582; 2 Washburn on Real Property, 3d Ed., Chap. 1, Section 3, par. 9, p. 30; McCabe v. Hood, 5 Cir. Dec., 292, 13 C. C., 621; Base Lake Co. v. Hollenbeck et al., 5 Cir. Dec., 242, 11 C. C., 518; Allen v. San Jose Land & Water Co., 15 L. R. A., 93; James v. West, Admr., et al., 67 Ohio St., 28; Springer v. Avondale, 35 Ohio St., 620; Lillibridge et al. v. Lackawanna Coal Co., 143 Pa. St., 293, 13 L. R. A., 627, 24 Am. St. Rep., 303; Webber v. Vogel, 189 Pa. St., 158; Proud v. Bates, 34 L. J. Ch., 406; Pollock v. Cleveland Ship Bld. Co., 56 Ohio St., 655.

      Mr. J. M. McGillivray; Mr. Charles S. Turnba%igh; Mr. Thomas E. Duncan; Mr. J. W. Barry and Mr. L. K. Powell, for the Indian Camp Coal Co., defendant in error, cited and commented upon the following authorities:
    Jones on Real Property, Section 537; Sloan et al. v. Lawrence Furnace Co., 29 Ohio St., 568; Tod v. Stambaugh, Ohio St., 469; Edwards v. McClurg, 39 Ohio St., 41; Newark Coal Co. v. Upson, 40 Ohio St., 17; Wadsworth Coal Co. v. Silver Creek Mining & Ry. Co., 40 Ohio St., 559; Barringer & Adams on Mines & Mining, 585; Lessee of Sperry v. Pond et al., 5 Ohio, 390; Webber v. Vogel, 189 Pa. St., 156; Paine v. Griffiths et al., 86 Fed. Rep., 452; Bainbridge on Mines & Minerals, 145; MacSwinney on Mines, 67, 269; Junction Railroad Co. v. Ruggles, 7 Ohio St., 8; 2 Snyder on Mines, Sections 927, 995, 1002, 1010, 1016 and 1128; Lillibridge et al v. Lackawanna Coal Co., 143 Pa. St., 293, 24 Am. St. Rep., 544; Consolidated Coal Co. v. Schmisseur, 135 Ill., 371; Hamilton v. Graham, L. R. R. Sc. & D., 166; Proud v. Bates, 34 L. J. Ch., 406; Louisville & Nashville R. R. Co. v. County Court of Davidson Co., 1 Sneed (Tenn.), 637; Chartiers Block Coal & Coke Co. v. Mellon, 152 Pa. St., 286; Section 2792, Revised Statutes.

      Mr. S. F. White, for Patton, plaintiff in error, cited and commented upon the following authorities:
    Barringer & Adams on Mines & Mining, 131; Detlor et al. v. Holland, 57 Ohio St., 503; Meredith v. Frank et al., 56 Ohio St., 479; Webber v. Vogel, 159 Pa. St., 235, 189 Pa. St., 156; Wadsworth Coal Co. v. Silver Creek Mining & Ry. Co., 40 Ohio St., 559; Edwards v. McClurg, 39 Ohio St., 48; Stambaugh, Exr., v. Smith, 23 Ohio St., 591; Lillibridge et al. v. Lackawanna Coal Co., 143 Pa. St., 235; Burnger v. Humphreys, 41 Ohio St., 340; Jones on Easements, Section E 355 to 359, 814, 347; City of Pomeroy v. Buckeye Salt Co., 37 Ohio St., 520; Bouvier’s Law Dictionary; Chartiers Block Coal & Coke Co. v. Mellon, 152 Pa. St., 286; Lessee of Ludlow’s Heirs v. McBride, 3 Ohio, 258; Northwestern Ohio Natural Gas Co. v. Davis et al., 9 C. C., 551; Bass Lake Co. v. Hollenbeck et al., 11 C. C., 508; McCabe v. Hood, 13 C. C., 621; Pollock v. Cleveland Ship Bld. Co., 56 Ohio St., 655; Tootle v. Clifton, 22 Ohio St., 247; Consolidated Coal Co. v. Schmisseur, 135 Ill., 371; 2 Snyder on Mines, 857; Converse et al. v. Haw

      kins, 31. Ohio St., 210; Section 296, Revised Statutes.

      Messrs. McGillivray & Armstrong, for The Emma Coal Co., defendant in error, cited and commented upon the following authorties:

      Wadsworth Coal Co. v. Silver Creek Mining & Ry. Co., 40 Ohio St., 559; Consolidated Coal Co. v. Schmisseur, 135 Ill., 271; Detlor et al. v. Holland, 57 Ohio St., 503; Burgner v. Humphrey 41 Ohio St., 340;
   Davis, J.

This court has several times recognized and applied the doctrine that there may be a complete severance of the ownership of the surface of land from the ownership of the different strata of mineral which may underlie the surface; and that the creation of a separate interest in the mineral with the right to remove the same, whether by deed, grant, lease, reservation or exception, unless expressly restricted, confers upon the owner of the mineral a fee simple estate, which is of course determinable upon the exhaustion of the mine. The last utterance upon this subject was in Gill et al. v. Fletcher 74 Ohio St., 295.

The grant of such an estate in the mineral; in whatever form, necessarily implies the right to or remove such portions of the containing strata as may be necessary or proper for the convenient and proper removal of the mineral itself, having regard at the same time to the right of the surface owner to sub-jacent support. This is strikingly manifest in both of the cases at bar. In one of these it appears that the coal vein in the field in which the Indian Camp Coal Company is operating averages about four feet in thickness; and in the other that the coal vein where the Emma mine is located is from thirty to thirty-eight inches 'in thickness. It is evident that if the mine owner is to be restricted to the exact limit of the thickness of the vein of mineral, with no right to remove any portion of the superimposed strata for necessary headway in working or in making the mine secure, or with no right to use or remove any portion of the underlying strata for drainage, support for tramways and the like, the grant to him of ownership in the mineral would be of little practical value, or none at all. .

From the nature and purposes of an ownership such as we have described above, it follows that the mine owner has the right to use as he may choose, but without injury to the owner of the soil, the space left by excavation of the mineral, so long as it remains a mine; that is to say, until the mineral shall be practically exhausted. It results from the absolute proprietorship over the mineral in place, that the owner thereof has a like interest in the containing chamber until the termination of the estate. MacSwinney on Mines, 9-11, 67-69. The phrase, “containing chamber,” as used in the books, is simply a convenient expression for the limits or boundaries of the grant. The grant is an entirety and the estate thereby created is determinable as a whole upon the contingency of the exhaustion of the mine. It is therefore illogical and inconsistent, and. would be impracticable and unjust, to hold that as fast as the mineral is taken put, the resulting empty space should revert to the owner of the upper strata. Such a narrow and technical interpretation of the grant would result in embarrassments to the mining industry which would be intolerable. The empty space is, therefore, not merely property which may be used as an incident to the removal of the mineral included in the grant; but, as suggested by the author cited above, he may use the space created by removal of mineral within the grant, as a way for the carriage of minerals from his adjoining .lands; or, if he prefers to do so he may cut a passage through the minerals and use it for the carriage of minerals from his other lands., MacSwinnev on Mines, 67-68. . .

In creating a separate mining right a grantor may, of course, protect himself by restrictions; but in the absence of such restrictions we think that the rulings in Lillibridge et al. v. Lackawanna Coal Co., 143 Pa. St., 293; Webber v. Vogel, 189 Pa. St., 156; Consolidated Coal Co. v. Schmisseur, 135 Ill., 371; Hamilton v. Graham, L. R., 2 Sc. & Div., 166; Proud v. Bates, 34 L. J. Ch., 406, 411, are sound law and should be followed.

Learned counsel have attempted to reason out these cases for. the plaintiffs in error upon the canons of the law of easements. The right which is claimed by the defendants in error is not an easement, which is a right or burden in, upon or over the estate of another; for here the defendants claim, as we have endeavored to make clear, the right to use. their own property as a wa)r for transporting coal mined on adjacent estates.

The judgments of the courts below are affirmed.

Sitauck, C. J., Price, Crew and Summers,. JJ., concur.


author: Spear, J.

text:
    Poston v. Hull.

      Stockholder having sold stock — Before corporation became insolvent — Not liable for corporation debts — Until stock liability of existing holders is exhausted — Corporation law.

    One who has been a holder of the stock of an insolvent corporation but has disposed of his stock in good faith prior to such insolvency and prior to the commencement of an action to enforce the statutory liability, cannot be held liable for a debt of the corporation before the full one hundred per cent, liability of the existing solvent stockholders within the jurisdiction has been exhausted, although the debt of the creditor against the corporation was incurred before the assignment and the assignee of the stock is insolvent.
    (No. 9907
    Decided February 5, 1907.)
    Error to the Circuit Court of Athens county.
    The action in the court of common pleas was to enforce the statutory liability of stockholders of the Nelsonville Artificial Ice, company, an Ohio corporation. The company was found to be insolvent in May, 1897, and suit to enforce statutory liability was commenced by the defendant in error, Robert S. Hull, against the corporation and divers persons alleged to be stockholders, on the 15th of February, 1898. Elias M. Poston, plaintiff iu error, was a stockholder of the company, holding forty-eight shares, prior to the month of June, 1894, about which time he transferred his stock in good faith to a number of persons in varying amounts. Some of those persons at the time of the suit proved to be' insolvent. The debt of Hull was contracted by the corporation during the time that Poston was such stockholder. The courts below held certain existing stockholders liable and assessed upon them twenty-six per cent, of the face value of their stock on their stockholders’ liability. That proving insufficient to pay the debts of the corporation, Poston was brought in and it was demanded that because of the fact that some of the purchasers of stock from him had become insolvent he must make up the shortage. His contention was that he could not be called upon- inasmuch as his transfer of stock was in good faith long prior to the insolvency of the corporation and commencement of the suit, until the one hundred per cent, liability of those who were stockholders at the time of the failure of the company and commencement of the suit had been exhausted. This claim the circuit court on appeal held to be invalid and proceeded to render judgment against Poston, and it is to reverse that judgment that this proceeding in error is brought.

      Messrs. Jewett & Wood, and Messrs. Addison, Sinks & Babcock, for plaintiff in error, cited and commented upon the following authorities:

      Brown v. Hitchcock, 36 Ohio St., 667; Barrick v. Gifford et al., 47 Ohio St., 181; Harpold et al. v. Stobart, 46 Ohio St., 397; Wick National Bank v. Union National Bank et al., 62 Ohio St., 446; Mason v. Alexander, 44 Ohio St., 318; Umsted v. Buskirk et al., 17 Ohio St., 113; Peter v. Union Mfg. Co. et al., 56 Ohio St., 181.

      Mr. Harry G. Stalder and Mr. L. A. Koons, for defendant in error, cited and commented upon the following authorities:

      Wheeler et al. v. Faurot, 37 Ohio St., 28; Brown v. Hitchcock, 36 Ohio St., 667; Barrick v. Gifford et al., 47 Ohio St., 181; Harpold et al. v. Stobart, 46 Ohio St., 297; Mason v. Alexander, 44 Ohio St., 318; Wick National Bank v. Union National Bank et al., 62 Ohio St., 446.
   Spear, J.

From the statement it will appear that the question in the case is: Can one who has been a stockholder in an insolvent corporation, but has disposed of his stock in good faith prior to such insolvency and prior to the commencement of an action to enforce the statutory liability, be held liable' for debts incurred by the corporation while he was such owner before the full one hundred per cent, liability of the existing solvent stockholders, within the jurisdiction, has been exhausted, for the reason only that the assignee of such original stockholder has become insolvent5

The precise question upon identical facts has not been determined in any reported case in this state so far as we are advised. Its determination is of less consequence now than it might otherwise have been because of the recent amendment to the constitution abrogating the double liability of stockholders of corporations, but it has been deemed best to report this case since there may be situations in the affairs of other corporations identical with the circumstances of this contention, and since this court has reached a conclusion upon the law of the case contrary to that of the courts below. We understand the law to be well settled by decisions of this court, notwithstanding the fact, as before stated, that the precise question has not before been presented.

From Wright v. McCormack, 17 Ohio St., 86, Umsted v. Buskirk, same volume, 113, Brown v. Hitchcock, 36 Ohio St., 667, Harpold v. Stobart, 46 Ohio St., 397, Barrick v. Gifford, 47 Ohio St., 180, Peter v. Union Mfg. Co., 56 Ohio St., 181, and Wick National Bank v. Union National Bank, 62 Ohio St., 446, we gather the following propositions as established:

The double liability imposed by the statute is not a primary resource for the debts of the corporation, but is imposed for the exclusive benefit of creditors, and is to be resorted to by creditors only in case of the insolvency of the corporation. A suit to enforce such liability is for the benefit of all the creditors, and no creditor can acquire a priority, or maintain a separate suit if there are other creditors. The liability is several in its nature, but the right arising out of that liability is, as against the stockholders who are such at the beginning of the action, for the common and equal benefit of all.

An owner of stock, in the absence of a by-law to the' contrary, has absolute power of disposition over the same, and may dispose of it by sale or gift at his pleasure. If the sale or gift is made in good faith, and the shares transferred on the books of the corporation to the assignee, the transferrer does not remain an equitable owner therof, or continue' liable for future corporate debts.

The liability of stockholders in favor of a creditor attaches at the time the debt of the corporation is contracted, and is not necessarily discharged by the transfer of the stock, but the assignee of the stock is held to indemnify the assignor on account of such liability. And, in a suit by creditors, the then existing stockholders are severally chargeable with the payment of such liability. If, by reason of insolvency, the amount due from any stockholder who has received his stock by assignment is not collectible, the assignors - of his stock up to the time the liability attached may be charged with the deficiency.

The rule that the owners of stock who are .such at the time of the commencement of the suit to enforce liability are liable for the debts of the corporation is not varied in favor of a particular stockholder by the fact that his stock may have been issued to him by the company after the creation of the debts.

A stockholder who in good faith transfers his stock to one who afterwards becomes insolvent is liable to creditors for such portion only of the corporate debts existing at the time of the transfer and remaining unpaid as will be equal to the proportion which the capital stock assigned bears to the entire capital stock held by solvent stockholders within the jurisdiction liable in respect to the same debts, tó be ascertained at the time judgment is rendered-.

Where a stockholder transfers his stock in good faith to one who afterwards becomes insolvent and is insolvent at the time of the decree, and a sufficient fund cannot be raised by assessment upon solvent existing' stockholders to satisfy all creditors, the stockholder who has thus assigned his stock is liable as hereinbefore stated. But, in such case the fund arising from assessments on solvent existing stockholders will be applied pro rata upon all the debts of the corporation, and the funds arising from an assessment upon a person who had so assigned his stock will be applied to the residue, if any, owing to those who were creditors at the time such stock was assigned.

It must be obvious, from the- foregoing, that the rule that liability to creditors follows the stock and that the owners of stock who are such at the time of the commencement of the creditors’ suit are primarily liable'for the debts of the insolvent corporation, is fully established. This being so, it follows with just as much certainty that such liability must first be exhausted before recourse can he had against a former owner of the stock who has in good faith transferred his stock, and that the liability is to the extent only of the residue remaining unpaid of the corporate debts owing at the time of the assignment of the stock. This conclusion determines the question in this case.

It is, however, contended by learned counsel for defendant in error that their contention in support of the judgment below is sustained by the holding in Umsted v. Buskirk, supra, and attention is directed specially to the following: “As between them [stockholders] and a creditor each stockholder is severally liable to all the creditors; as between themselves each stockholder is bound to pay in proportion to his stock.” Also, that “the right arising out of this liability is intended for the common and equal benefit of all the creditors.” In response to this claim it is enough to say that the court in that case was dealing only with a controversy between a creditor of the corporation and existing stockholders. No question as to the effect of an assignment of stock, nor of the right of any person other than the creditor and the then exist-mg stockholders, was involved, and, by the simplest rules of construction, the language used must be held to apply to the case in hand, and not to an essentially different case.

Our conclusion is. that in the case at bar Poston cannot be held so long as the full liability of the existing stockholders has not been exhausted.

To avoid possible misunderstanding it may be added that this controversy, having arisen before the recent amendment to the constitution of the state, which abolishes the double liability of stockholders, is not affected by that amendment.'

Judgment of the circuit court reversed and cause remanded.

Reversed.

Shauck, C. J., Price, Crew, Summers and Davis, JJ., concur.