Page images

transfer to Los Angeles county. O'Neil v. O'Neil, 54 Cal.- 187. In the bill of exceptions, facts are cited sufficient upon which to base an order changing the place of trial. The order is affirmed.


DE HAVEN, J. I dissent from the judgment.

HARRISON, J., (concurring.) I think the order appealed from should be affirmed. In my opinion the amendment of 1891 to section 128, Civil Code, was intended to pre scribe a residence of three months in some particular county as a jurisdictional condition to be shown by the plaintiff before he should be entitled to a divorce, just as the previous requisite, which is also retained, of six months' residence in the state, is a jurisdictional condition to entertaining his application for a divorce. The right to a divorce is particularly a matter of statutory creation, and the legislature has the same right to prescribe the conditions in procedure upon which a suit shall be instituted in its courts as it has to limit the causes for which the divorce may be granted. This construction of the section is consistent with the provisions of the Code of Civil Procedure for changing the place of trial of the action after it has been brought, and gives full force to the several provisions of both Codes.

No objection was made in the court below to the absence of a demand in writing for a change of the place of trial, and, as the bill of exceptions states that a "notice in due form" of the motion therefor was filed by the defendant, it can be assumed here that the notice included a proper demand.

CHAPIN et al. v. BROWN. (No. 18,117.) (Supreme Court of California. Oct. 14, 1893.)


A lumber firm agreed with two of its members to sell them sawed lumber at & certain price. The two members formed a new firm, and one of them sold his interest in the contract to the other, and the latter sold interests therein to two strangers. The old firm continued to sell to the purchasing concern under the agreement, and to receive payment therefrom, without regard to its personnel, the bills being in all instances made out in the name of the purchasing concern. There was no evidence of any agreement to release the original contractors. Held, that there was no novation, and the lumber firm could sue one of the purchasing members for an accounting without joining his new associates in the purchasing contract.

Commissioners' decision. Department 1. Appeal from superior court, Fresno county; M. K. Harris, Judge.

Action by J. E. Chapin, T. E. Peckinpagh, and Charles Peckinpagh against Albert Brown for an accounting. Judgment for plaintiffs. Defendant appeals. Affirmed.

R. P. Davidson, for appellant. J. R. Webb and L. L. Cory, for respondents.

BEATTY, C. J. I dissent. There was no demand in writing for a change of the place of trial ever filed by the defendants, or either of them, and such demand has more than once been held by this court to be essential to the validity of an order changing the place of trial. Code Civil Proc. $ 396;" Estrada V. Orena, 54 Cal. 407; Byrne v. Byrne, 57 Cal. 348. Unless these decisions are to be reversed, the order appealed from should be reversed. As to the point discussed in the opinion of the court, I concur in the main in the views expressed by Justice PATERSON, but for the reason above stated I must dissent from the judgment of affirmance.

VANCLIEF, O. On August 15, 1887, the plaintiffs and the defendant were copartners doing business in the firm name of Sugar Pine Mill & Lumber Company. Their business was that of manufacturing and selling lumber. They owned 160 acres of timber land, upon or near which they had built a sawmill. On August 15, 1887, a written contract between the copartnership and two of its individual members, namely, Chapin and the defendant Brown, was executed, by which the copartnership agreed to sell to Chapin and Brown, and the latter agreed to purchase, all the lumber to be sawed from the timber then standing or fallen on the said 160 acres of land, “or that may be sawed in the mill of the said parties of the first part (the copartnership) from other claims before finishing sawing the timber from the above-described claim, [the 106 acres,]" at the price of $9 per thousand feet, to be de livered in the mill yard. The parties of the first part further agreed that after the year 1887 they would deliver, as aforesaid, "an annual amount of one million feet or more, at the option of the said second parties." The agreement contains other stipulations not relevant to the issues in this case. On the same day (August 15, 1887) another agreement was executed between the copartnership and two others of its members, namely, T. E. Peckinpagh and Charles Peckinpagh, by which the latter agreed to cut, haul, and saw into lumber all the timber on said 160 acres of land, and to stack the lumber in said mill yard, for which they were to be paid $6 per thousand feet. As to the amount of lumber to be sa wed, they

The section provides: "If the county in which the action is commenced is not the proper county for the trial thereof, the action may, notwithstanding, be tried therein, unless the defendant, at the time he appears and answers or demurs, files an affidavit of merits, and demands, in writing, that the trial be had in the proper county."

agreed to be governed by the above-men from an order denying his motion for a new tioned contract with Chapin and Brown. trial. For the purpose of performing this contract 1. The appellant contends that there was a they were to have the use of said mill, but novation of the purchasing contract by which were to keep it in repair. This contract the assignees of portions thereof were substialso contains matters not material to this tuted for the original contractors (Brown case. Chapin and Brown assumed to con and Chapin) by consent of the Sugar Pine stitute a distinct copartnership under the Mill & Lumber Company, and therefore that firm name of North Fork Lumber Company, appellant is not individually liable, as found and transacted the business under their con by the court. It is not claimed, however, tract with the Sugar Pine Mill & Lumber that there was any evidence of such noraCompany in that name; but at some time | tion, or consent thereto, by the Sugar Pine prior to January 1, 1888, Chapin assigned his Mill & Lumber Company, other than the interest in their contract with the Sugar facts that the lumber was delivered to and Pine Mill & Lumber Company to Brown, paid for (so far as payments were made) by who agreed with him to perform all its ob the North Fork Lumber Company, as conligations, and withdrew from the North stituted at the times of such delivery and Fork Lumber Company. Brown continued payments. Brown never assigned all his inthe business under the contract in the name terest in the purchasing contract, but re of North Fork Lumber Company until Jan mained a member of the North Fork Lumber uary, 1888, when he assigned an interest in Company during all its transactions with the contract to John Bartram, and on May the Sugar Pine Mill & Lumber Company. 1, 1888, assigned another interest to B. F. Nor is there any evidence that the latter Ellis. After these assignments, Brown, Bar-company ever agreed or consented to distram, and Ellis constituted the North Fork charge him or Chapin from their obligation Lumber Company, and conducted the busi on that contract, to accept Bartram or ness with the Sugar Pine Mill & Lumber Ellis in their stead for any part of such obCompany under the lumber contract in that ligation. No objection on the ground of misname. In the fall of 1888, T. E. and Charles joinder or nonjoinder of parties to the ac Peckinpagh assigned their contract with the tion was made by demurrer or answer, or Sugar Pine Mill & Lumber Company of Au otherwise, in the court below, nor is ang gust 15, 1887, (above set out,) to the North point made here on this ground. All the Fork Lumber Company. By the performance parties to the purchasing contract, and all of this contract on the part of the Peckin the members of the Sugar Pine Mill & Lumpaghs, the North Fork Lumber Company be ber Company were before the court, and, came entitled to receive from the Sugar Pine as there as no novation of that contract, neiMill & Lumber Company $6 per thousand ther Bartram nor Ellis was a necessary feet for manufacturing the lumber which party to the accounting. The state of ac they were to purchase from the latter com counts between the members of the North pany at the price of $9 per thousand. From Fork Lumber Company is immaterial for and after this assignment by the Peckin any purpose of this action. paghs, Charles Peckinpagh was employed 2. The only other point requiring considby the North Fork Lumber Company, at a eration arises on the following additional salary, to do the sawing, and he continued facts: During the year 1890, while Charles in that position during the years 1890 and Peckinpagh was doing the sawing for the 1891.

North Fork Lumber Company, as aforesaid, The object of this action is to dissolve he and a Mrs. Bearden sold and delivered to the Sugar Pine Mill & Lumber Company, to the North Fork Lumber Company a lot of compel an accounting between its members, logs cut from other lands than the 160 acres and especially between the copartnership belonging to the Sugar Pine Mill & Lumber and the defendant, who, it is alleged, owes Company, and to which the latter company the concern a balance of $3,090 for lumber de- | held no title. These logs were sawed by livered to the North Fork Lumber Company Charles Peckinpagh during 1890, while enduring the year 1890, under the contract | ployed by the North Fork Lumber Company, first above mentioned, called the "purchas as aforesaid, and produced 683,923 feet of ing contract.” The court found him to be lumber, which was piled in the mill yard

, individually responsible on that contract, and thence removed by the North Fork Lumand that he was indebted on that account to ber Company. The evidence tends to prove the other members of the company as fol that these logs were sawed with the knowl lows: To Charles Peckinpagh, $427.45; to edge and consent of the plaintiffs, and with T. E. Peckinpagh, $471.85; to J. E. Chapin, an understanding between plaintiffs and the $183.80,-amounting to $1,383.18; and con North Fork Lumber Company that the latsequently that he was indebted to the co ter was to pay the Sugar Pine Mill & Lumpartnership (of which he was an equal mem ber Company, for the use of their mill in ber) in the sum of $1,844.14. The judgment sawing those logs, 50 cents per thousand was in accordance with this finding. The feet; and it appears that a large portion of defendant appeals from the judgment and the lumber sawed from those logs must bare

[ocr errors][ocr errors][merged small][ocr errors]
[ocr errors]
[ocr errors][merged small][ocr errors][ocr errors]


CO. et al. (No. 18,091.) (Supreme Court of California. Oct. 13, 1893.) CORPORATION MORTGAGE BY PRESIDENT AU


1. A corporation authorized its president to execute a mortgage to secure a loan, at a rate of interest and for a length of time specified. The mortgage executed by him was for a shorter period than authorized, and provided that the interest should be paid monthly, that a failure to pay interest when due rendered the principal due, and that the mortgagees should recover attorney's fees in case of foreclosure. These conditions were not authorized, but the company accepted the money and used it for the purposes intended, and paid the interest on the mortgage monthly for four months. Held that, in an action to foreclose the mortgage for default in interest, the corporation and its assignee were estopped from denying the authority of the president to execute it.

2. Where the answer, in such action, simply denies the "due execution" of the mortgage for want of authority, but does not deny the facts shown by the pleadings which constitute a ratitication, plaintiffs are entitled to judgment without proof of authority.

3. In such case plaintiffs are entitled to recover the attorney's fees, also, provided for in such mortgage.

4. Such assignee, in the absence of fraud, is in no better position than such corporation.

5. A denial in answer by such assignee, on information and belief, that certain appliances connected with property described in the mortgage were attached to the realty and were fixtures, was insufficient, since he must be presumed to be in possession and to have knowledge as to such fact.

Commissioners' decision. Department 2. Appeal from superior court, Sacramento county; A. P. Catlin, Judge.

Action by H. Gribble and Seth Gainsley against the Columbus Brewing Company, and Lee Stanley, its assignee, to foreclose a mortgage. From a judgment entered on the pleadings in favor of plaintiffs, defendant Stanley appeals. Affirmed.

Holl & Dunn, Clinton L. White, and Add. C. Hinkson, for appellant. Armstrong & Plattauer, for respondents.

bart to Seat 12 Djectic 2

entered into the estimate of the 1,030,000 feet alleged and found to have been delivered to defendant in 1890, under the contract set out in the complaint. The appellant contends that the lumber produced from those logs purchased by the North Fork Lumber Company never was the property of the Sugar Pine Mill & Lumber Company, and therefore could not have been sold or de livered as such, under the contract set out in the complaint, and that the Sugar Pine Mill & Lumber Company were entitled to charge only for the use of the mill in sawing those logs at the agreed price of 50 cents per thousand instead of $3 per thousand, which they were to receive for the lumber sa wed from timber taken from the land of the Sugar Pine Mill & Lumber Company. Thus far, perhaps, appellant is right, but his assumption that in the accounting the court credited the Sugar Pine Mill & Lumber Company $3 per thousand for the lumber sawed from the logs purchased by the North Fork Lumber Company is not sustained by the record. Assuming that all the lumber sawed before January 1, 1890, had been paid for before the commencement of this action, as seems to be admitted, and that only the lumber sawed in 1890 and 1891 is involved, as appears by the findings of the court, and also assuming that only 50 cents per thousand was credited to the Sugar Pine Mill & Lumber Company on account of the 683,923 feet produced from the logs purchased by the North Fork Lumber Company, and $3 per thousand for all the lumber sawed from other timber during 1890 and 1891, viz. 735,121 feet, yet the judg. ment against the defendant would seem to be considerably less than it should have been. The 735,121 feet sawed from other timber than logs purchased by the North Fork Lumber Company, at $3 per thousand, would amount to $2,205. Deduct from this oue-fourth thereof for defendant's share, and the remainder due the other three partners is $1,654, whereas only $1,383.18 was allowed them by the court. This result is Justified by the fact that the accounting was not confined to the year 1890, during which the logs purchased by the North Fork Lumber Company were sawed, but included, without objection, the 389,044 feet of lumber produced from other timber during 1891. It may be that the defendant was properly credited with payments or set-offs not shown by the record, which accounts for this result. However this may be, it is enough for the disposition of this appeal that the records shows no error prejudicial to the appellant. I think the judgment and order should be affirmed.

[ocr errors]
[ocr errors]
[ocr errors]
[ocr errors][ocr errors]

SEARLS, C. This is an action to foreclose a mortgage. A decree in favor of the plaintiffs was entered upon the pleadings, from which Lee Stanley, the assignee in insolvency of the Columbus Brewing Company, (a corpa ration) defendant, appeals.

The admitted facts of the amended and supplemental complaint, coupled with certain affirmative allegations of the answer, show that the property described in the pleadings, and known as the “Columbus Brewery," with the machinery, trade fixtures, tools, etc., was formerly owned by Chris. Wahl and wife, who, on the 27th day of October, 1890, conveyed the same to the defendant the Columbus Brewing Company, subject to a debt of $16,000, secured by a mortgage upon the real property and a chattel mortgage upon the personalty, held by the Germania Building & Loan Association, and evidenced by a proin

[ocr errors]
[blocks in formation]
[ocr errors]

PER CURIAM. For the reasons given in the foregoing opinion the judgment and order appealed from are affirmed.

[ocr errors]

issory note drawing Interest at 1012 per cent. held by the Germania Building & Loan Asper annum. This mortgage contained a pro sociation, and used the residue of the loan vision that for a failure to pay any install in its business. That the defendant corment on said note when due, or any interest | poration had full knowledge of all the facts thereon when due, a foreclosure might be had stated herein, including the fact that the for the whole at the option of the mortgagee, loan was made for one year, that interest and for counsel fees on foreclosure. On the was payable monthly, and as to all stipula. 9th day of March, 1891, the defendant corpo tions and covenants of the note and mortration, being desirous of paying off the debt gage, and with such knowledge it paid the so secured by mortgages upon its property, interest on the promissory note monthly, as negotiated a loan of $17,000 of the plaintiffs, the same became due, until July 5, 1891. and to secure the same with interest at 10 when for one month it failed to pay the inper centum, by its president, authorized as terest which became due, whereby by the hereinafter stated, made its promissory note terms of the note the principal and interest to plaintiffs for said sum of $17,000, with in became due, and this action was brought to terest at 10 per centum, interest payable foreclose the mortgage. The corporation anmonthly, and, if not so paid, then the whole swered the amended and supplemental comof the principal and interest to become due plaint, admitting all the allegations thereof and payable. To secure the payment of said except the claim therein of a counsel fee of promissory note the defendant, by its presi- $857, and averred that $500 is as much as dent, authorized as hereafter stated, executed should be allowed by the court as a counsel a mortgage upon its property, including fix fee. Subsequent to the commencement of tures, tools, etc. The mortgage provided the action the corporation defendant was adfor a counsel fee on foreclosure, and that a judged insolvent, and defendant Lee Stanley receiver might be appointed, etc.

was duly appointed assignee of said inThe following is a copy of the motion and solvent, qualified as such, and is still asresolution under which authority was given signee. He was made a defendant herein, to the president of the corporation defendant

and has answered, raising the questions pre to make the note and execute the mortgage, sented by the foregoing facts. Succinctly except that the resolution as offered and stated, his answer admits the indebtedness passed contained the words "one year" as to the plaintiffs, but denies the authority of the period for the loan, and by inadvertence the president of the corporation defendant and mistake in making a record of the reso to contract the loan for one year, or to make lution the words "five years" were written the interest payable monthly, or to provide instead of "one year:" "The following mo that, if not so paid, the principal should be tion was made by E. Gunn, seconded by J. come due, or to provide for the payment of Schneider: Whereas, this corporation is in a counsel fee upon a foreclosure of the mortdebted to the Germania Building and Loan gage. He also avers as to certain propAssociation in the sum of sixteen thousand erty, averred in the complaint to be firdollars, ($16,000,) and it is desirous to trans tures attached to the building and necessary fer said loan to other parties; and whereas, to the brewing business conducted therein, further, H. Gribble and Seth Gainsley have a want of information or belief sufficient offered to loan to said corporation the said to enable him to answer, and therefore de sum of sixteen thousand dollars and one

nies the truth of the allegations relating thousand dollars more, making seventeen thereto. Plaintiffs' mortgage was recorded thousand, ($17,000,) and to take a mortgage upon execution, and notice lis pendens filed, on the real and personal property belonging when the action was commenced. The to said corporation: It is therefore resolved prayer of the complaint, among other things, that the president be, and he is hereby, au demands that the plaintiffs may be subrothorized and directed, in the name and for gated to the lien and rights of the Germania the use and benefit of said corporation, to Building & Loan Association; that defendnegotiate said loan of seventeen thousand ant Stanley be estopped to deny that the dollars, ($17,000,) with interest thereon at president of the corporation defendant bad the rate of 10 per cent. per annum, from the authority to execute the note and mortgage said Gribble and Gainsley, for the period of as therein specified; that the resolution of five (5) years, and in the name and for the the corporation be reformed so as to read benefit of said corporation to execute, ac "one year," instead of "five years," etc. knowledge, and deliver to said Gribble and Conceding, without deciding, that the presiGainsley a mortgage on all the real and per- dent of the corporation defendant was withsonal property belonging thereto, or so much out authority to execute a mortgage for thereof as may be necessary to secure said the term, and with the conditions as to the loan; and the president is further authorized dates at which interest was to be paid, the and directed to do any and all acts in the penalty following nonpayment of such in name of the corporation that may be neces terest, and the provision as to a counsel feg sary to secure said loan."

upon foreclosure, and we still think the Plaintiffs advanced to the corporation de- decree was proper. The note and mortgage fendant the $17,000, with which the latter were such as the corporation had a right to paid off and discharged the prior moremo authorize, and consequently were not ultra

[ocr errors]
[ocr errors]
[ocr errors]

Otimes, but dede 3 bound by the act as done, yet if the corporathe loan for at have been competent to do the act, know7 payable borte ingly ratifies it or accepts the benefit of it,

80 paid the man or if all the persons having a right to object or to provide 73 to the act knowingly acquiesce in it, the act ce upon a forei* will be as binding on the corporation as if it

also gres or' had been originally authorized. This proponed to the front of the law of agency that, when a person cim to 18 effect of the act will be the same as if it had

int to is has purported to act on his behalf, the legal ruth of the been authorized before it was done." "A tion, and most transaction is equivalent to a consent to all instead of corporations and as to executory contracts

de German's Best vires. The most that can be claimed is that insert (2) The defendant corporation reand sed ide o

the contract as executed was in excess of ceived the consideration of $17,000 from

the power conferred by the board of di the plaintiffs, and applied the money to its Låd till kors: rectors upon the president,—that it varied uses, including the payment of a prior mortNi, ladding 2:

from the authority given him. In this re gage upon its property and the extinguishmade for oit 2:

spect the transaction does not differ from ment of the lien thereof. (3) The corporable porth, as

that of an agent of an individual who has tion defendant, by its representations, dec

exceeded his authority. That which a prinCOP:2193

larations, and acts, through its directors, inwith std kry

cipal may authorize an agent to perform, he tentionally led the plaintiffs to believe, and

may ratify when performed by the latter they did believe, the president of the cor1 the prom...?!

without authority; and where, with full poration was authorized to execute the note Decade die

knowledge of all the facts involved, a prin- and mortgage for one year, with interest pe mooth it ;

cipal reaps the fruits of the unauthorized | payable monthly. (4) The defendant corich became the

contract of his agent, and for some time poration, with full knowledge of the terms he note the yields acquiescence to its provisions, he will

and conditions of the note and mortgage, le, and this area be deemed to have ratified it, and will be

received and used the consideration of $17,be motoare estopped, as against one who has fully per

000, and paid the interest thereon monthly e amedded 'e formed the contract on his part, from re

as the same became due, from March 9, 1891, mitting all the pudiating it to the injury of the latter; and

to July 5, 1891. claim tbereina '! this doctrine applies to corporations equally

These facts are sufficient to constitute a a ferred that with individuals. Main v. Casserly, 67 Cal.

ratification of the acts of the president of -a!'owed by the 127, 7 Pac. Rep. 426; Pixley v. Railroad Co.,

the corporation, and are sufficient to supasient to the 33 Cal. 198; Foulke v. Railroad Co., 51 Cal.

port the invocation of an estoppel in pais the corpomoc i 363; Bradley v. Ballard, 55 III. 413; Jones v.

set out in the complaint. Clark, 42 Cal. 180. Taylor, in discussing the

A review of the answer of defendant Lee

Stanley shows that he admits the indebtedappointed question of acquiescence by private corpora

ness of $17,000 and interest; that he noLuided as sote tions in the unauthorized acts of their agents,

where denies that the note and mortgage e was made ! E at section 211 of his work on Corporations

were in fact executed, as set out in the comIs weral, pe uses the following language: "If an unau

plaint, but he does deny the due execution of the fores: thorized act is done on behalf of a corpora

those instruments, or that the president of LAS Ter 2.05 3. tion, although the corporation may not be

the corporation defendant was authorized so

to do, or that the defendant ever promised ent of the caption, or that corporate authority which would

to pay interest except annually, etc. The
second defense sets out the motion and
resolution of the defendant authorizing the
president to negotiate the loan and to ex-
ecute the mortgage, and avers the mistake by
which "one year was changed so as to read

“five years." He further avers that at the
sition is but an application of the doctrine

date of the mortgage the defendant corpora

tion was indebted to divers persons in large
ratifies the unauthorized act of another who

sums of money, which have not been paid,
etc. The denials of the answer do not ex-
tend to the facts constituting a ratification,

hence we are enabled to say they are strictly
voluntary acceptance of the benefits of a true; and yet the plaintiffs, by reason of the

additional facts which are not denied, are
the obligations arising from it, so far as the entitled to a judgment.
facts are known, or ought to be known, to The cases of Read v. Buffum, 79 Cal. 77,
the person accepting.” Civil Code, g 1589; 21 Pac. Rep. 555, and Association v. Busta-
Borel v. Rollins, 30 Cal. 409. It is not deem mente, 52 Cal. 192, are authority for the
ed necessary to pursue this inquiry further, necessity of proof as to the authority of cor-
or to quote at greater length from the multi porate agents, but have no application to a
tude of authorities in support of the position. case like the present, where the want of au-
The foregoing remarks must be understood thority in such agent is admitted, and the
as applying to private corporations and to validity of the contract is based upon the
executed contracts. The rule as to municipal ratification by the corporation of the con-

fessedly unauthorized act of its agent.
by private corporations is quite different. Schallard v. Navígation Co., 70 Cal. 144,

The admitted facts of this case which bring 11 Pac. Rep. 590, and Hardin v. Construc-
the defendants within the doctrine enunciated tion Co., (Iowa,) 43 N. W. Rep. 543, are
may be epitomized thus: (1) The president relied upon to defeat the right of plaintiffs
of the corporation defendant included in the to recover an attorney's fee on foreclosure.
note and mortgage terms and conditions The same considerations apply to this con-
which the corporation had power to author tention as to that touching the authority
ize, but which it did not authorize him to of the agent. There was no suggestion in

[ocr errors]

Cain is ou

action he complain: hat the plants e lien and

Load LILO ; De estupne 1 the corpo?? > erecute that Spalced trou be

[ocr errors]
[ocr errors]
[ocr errors]
[ocr errors]
« PreviousContinue »