70 Mo. 290 | Mo. | 1879
Lead Opinion
Our first point of inquiry will be as to the validity of the deeds of trust, which the plaintiff seeks to foreclose, because, if no title passed by such deeds it would be altogether futile to make further inquiry.
In the ease last cited, Gibson, C. J., in delivering the opinion of the court, said; “It is equally clear that the mortgage did not originally bind the corporation. It was executed not on a charter day, or a day appointed by a bylaw, but at a special meeting convened without notice, written or verbal, to the directors who did not attend. When a day has not been fixed by other competent authority, this notice is indispensable to a legal convention for the transaction of even ordinary business. * * But can the act be impugned now? A corporation can contract but by its agents, general or special; and in pursuance of powers delegated specially by its grant to particular persons, or generally, by its charter,.to the officers intrusted with its affairs. Hence, the members of this board stood in relation to it as servants whose acts may be disaffirmed for defect of authority, but by their master. But the maxim which makes ratification equivalent to a precedent authority, is as much predicable of ratification by a corporation, as it is of ratification by any other principal, and it is equally to be presumed from the absence
But by the express terms of section 8 of the act first referred to, it is provided that: “Nothing in this act shall be so construed as to convey or to authorize the commissioners to convey to the purchasers of the Cairo & Fulton Railroad any of the lands subscribed by the counties to the stock of said road.” This express reservation of lands of this description would entirely preclude them from passing by the sale or by the conveyance made by the governors his acts and his conveyance being in entire subjection to the familiar rule which confines a special-agent'within the precise limits of his delegated authority. No hold then,
.Numerous authorities have been cited for the defendant,. Allen, as showing that this agreement did not and' could not have that effect.- We do not regard any of these authorities as going so far. There is no doubt as to the general doctrine that notice to, or demand of, the pledgor is necessary before sale, in the case of a mere naked pledge-where no definite time of payment is fixed. Judge Story says- “ The common law of England existing in the time of Glanville, seems to have required a judicial process to-justify the sale, or at least to destroy the right of redemption. But the law as at present established, leaves an election to the pawnee. lie. may file a bill in equity against the pawner for a foreclosure, or he may proceed to sell ex mero motu, upon giving due notice of his intention to the pledger.” Story on Bailment, § 310. But the learned author is careful to say that: “ In speaking of sales by the pledgee, it has been assumed that there is no special agreement between the parties as -to the time or mode of sale, nor any stipulation wholly interdicting any sale. If any
The case of Stearns v. Marsh, 4 Denio 230, was shortly this: “The pledgers executed their note July 5th, 1837,. payable in four months, and pledged for its payment ten cases of boots and shoes; a few days thereafter the pledgers authorized the pledgees to sell certain of those cases; (Nos. 5, 6 and 7,) at a public sale about to occur at Rich’son the 19th day of July, and to apply the proceeds on the note This privilege the pledgees did not avail themselves of, but on the 15th of the following November, without any notice to the pledgers, caused the sale of the goods at Rich’s at public auction, indorsed the proceeds on the note, and brought suit against the pledgers for the balance due on the note, and a plea of non-assumpsit was pleaded. This sale was characterized as a tortious one, and the pledgees as wrongdoers. But in that case there was no agreement dispensing with notice, either of time or place of sale, no power of sale conferred and no time fixed by the contract of pledge when redemption was to occur. The case of Wilson v. Little, 2 Comst. 443, was one where the note was payable immediately. “I promise to pay Jacob .Little, or order, $2,000.” This note was virtually payable on demand, and in effect the court so held. But no demand of payment was made until several days after the sale of the pledge. Of course no court could give its sanction to such an unconscionable act; and it was aptly remarked then that: “ In every contract of pledge there is a right of redemption on the part of the debtor. But in this case the right was illusory and of no value if creditors could instantly, without demand of payment and without notice, sell the pledge.” The court, however, distinctly recognizes the principle that, where the parties by contract expressly fix the time for the payment of a debt secured by pledge, there no prior demand upon the pledger is necessary. The case of Brown v. Ward, 3 Duer 660, only decides that after notes fall due bonds pledged as col
In Milliken v. Dehon, 10 Bosw. 325, direct recognition, is given to the doctrine that “ all or any of the pawner’s rights can be waived or modified by consent, including notice of the time and place of sale,” the court remaking: “ There is, however, no express waiver of such notice' in the case before us.” In that instance the sale, a private one, occurred on the 26th day of December, when the sum advanced, $7,000, was not to be re-paid until the 4th day of January following, and a default had not yet occurred in respect to that, so that the sale which took place was not justified on the score of default. The only other ground upon which a sale was by the written agreement authorized to occur was, in the event a decline should occur in the value of the merchandise pledged, and the pledger should “ fail whenever demanded to deposit in cash sufficient to •cover such decline.” But there was no evidence of such demand, and consequently the sale was in direct violation .of the express agreement of the pledger. When the case went to the court of appeals, (27 N. Y. 364,) the power to sell given to the pledgee, which was “ at public or private sale, or otherwise, at his option, for the most it will bring,” was held to be a valid agreement.
In Markham v. Jaudon, 41 N. Y. 235, the trial judge had charged the jury that: “In the absence of a special agreement to authorize it, no sale of the stock could be made by the defendants except upon notice given to the plaintiffs of the time and place when the sale would take place,” and the verdict was for the plaintiffs and judgment accordingly, which judgment, though reversed by the intermediate court, was affirmed by the court of appeals. The chief point of defense in that case was, that the sale was made by stock brokers, of stock held by them, in accordance with a usage prevalent in the city of New York, whereby brokers may sell out their customers’ stock on exhaustion of the margin ; but such usage was held invalid,
Counsel for plaintiff have cited a very large number of authorities, tending either directly or else by necessary inference, to establish the doctrine that in cases of .this sort, the well known maxim “ conventio vineit legem,” is as fully applicable as to any "other species of contract whatsoever, and indeed why should it not be so ? The doctrine of waiver is one of the most familiar of doctrines; it pervades a very large portion of all human transactions-; under its operation rights are lost "and rights acquired; titles vested and titles divested; and it would be passing strange
We regard these bonds as having been fraudulently issued. After June 13th, 1861, the road was abandoned, the track torn up, the rolling stock disabled and destroyed, and this dismantled condition of the road continued until long after the sale of October 1st, 1866, when the Cairo & Fulton Railroad Company, in consequence of such sale, ceased to exist as a corporation. Moore v. Whitcomb, 48 Mo. 543. The alleged foundation of the order of June 13th, 1861, whereby $912,000 in bonds of the company were pledged, to and placed in possession of Kitchen and the two Bedfords, was the order of March 5th, 1861, which ordered that $20,000 be raised upon personal responsibilty for the purpose of paying the expenses necessary for laying the iron from Sikoston to Little River, and that $900,-000 of the company’s bonds be set apart and appropriated for that purpose, as indemnity to the parties who should raise the money. And the order of June 13th, 1861, is, in its turn, made the b...«is for the order of September 14th, 1866, which order distributed the bonds of the company between Kitchen, Miller, Poplin, the two Bedfords, Whitcomb, Hill, Crumb and Johnson. But there is evidence showing that the indebtedness to the Union bank of the State of Missouri, as recited in the last named order, had
As to the other bonds which go to make up the’581 of plaintiff, the evidence shows; as we think', though on this point there is-vexatious conflict, that they also formed' a portion of the ■ 912 bonds which were turned- over by Brayman in the early part of 1861, unissued, and which remained unissued in the hands of the company or its officers until 1866. As before seen, from ¿Tune 13th, 1861, no work had been done on the road, no service was performed for and no semblance of vitality existed in the company
Other circumstances, however, connected with this case will prove of equal efficiency in casting notice upon him. Webber was evidently Chouteau’s agent, for he agreed with Chouteau, on the 8th day of December, 1866, to “ absorb” for him the outstanding bonds of the Cairo & Eulton Railroad Company at cost, Chouteau furnishing the money, which he did, and the 581 bonds were all purchased through Webber, whose drafts were duly honored. This agreement between Chouteau and Webber was over five months after the road had been extensively advertised for sale by the governor in various newspapers, over three months after the sale of -the road, which plaintiff attended as a bidder, and nearly ten months subsequent to the passage of the “ sell-out act,” of which he admits knowledge, as well as of the governor’s advertisement made thereunder. Webber, at the time he bought the bonds for Chouteau, was one of the directors of the company, and had been since March, 1866, and was also one of the commissioners appointed under the “ sell-out act,” and Bedford, through whom Webber procured the bonds, was the “financial agent” of the company. We cannot, in the light of these and similar facts, presume Webber otherwise than conversant with all that transpired in reference to the bonds
Another circumstance in this connection not to be ignored is, that the bonds were purchased for less than one-half of the accrued interest. While this inadequacy would not itself-be sufficient to charge Chouteau with notice, yet it is a very pregnant fact to be given its due weight in connection with other things, in determining whether Chouteau is to be deemed an innocent purchaser. Parsons v. Jackson, supra. Nor is it to be forgotten that these bonds were not purchased in the ordinary routine of commercial transactions, in the customary prosecution of business, but were industriously searched for by Webber, the very accommodating agent who worked for nothing and bore his own expenses.
Kitchen certainly would not be permitted, did he still retain possession of the bonds, to shelter himself behind either of the statutory provisions above mentioned; and the ostensible purchaser from him, warned as he was by the faces of the bonds, of all the equities which had attached to them in consequence of the fraud committed, ought not in equity and good conscience to occupy a more advantageous position, or possess a higher claim to equitable relief. In short, Chouteau comes into court with hands no cleaner than those from whom ho bought, and a court of equity might even concede the operation of the statutory provisions to be as plaintiff claims, and still refusing its aid, leave him where it finds him.
There is no occasion to discuss the nature of certain titles of Allen -to the swamp lands by reason of certain conveyances to him, as whatever of validity they may possess must be subordinate to the deeds of trust.
For the reason just announced, the judgment-in favor of defendants Moore and Bridges, administrator of Patterson, as pledgees, was erroneous.. Since they claimed as owners, and not otherwise, and consequently could only recover in conformity with their pleadings, that judgment must also be reversed; and the same remarks are applicable here as were to the Schuschardt & Gebhardt bonds, because a power to sell the bonds, was in this instance, also, conferred by .Brayman upon Whitcomb and Moore, and default having been made in the payment of the note, the
The judgment against the defendant Hill must be affirmed, and this.regardless of the merits, as his motion for new trial was not filed within the time prescribed by law.
We also affirm the judgment against defendant Clark-son, thinking that he established no right of recovery, lie was the pledgee of a bond given to secure a note, executed by the company and Sexton, for the right of way through the pledgee’s land. Suit was brought on this note and judgment recovered, a transcript of the judgment sent to Chicago, judgment recovered against Sexton’s estate, and judgment, less $100,‘paid to Clarkson’s attorneys in satisfaction. of his claim. In addition to that, he after-wards sued out execution in Mississippi county, levied upon, sold and bought in the very right of way for which the note was given, and also the bond itself. We feel no hesitancy, therefore, in affirming the judgment which went against him.
In relation to the 51 bonds claimed by Seelye: the judgment in his favor, as to one of the bonds, and several of the coupons, deeming it correct, we affirm.
I regard the judgment of the circuit court correct, also, as to the remaining 50 bonds, and for these reasons : The statute, (1 R. S. 1855, p. 488, § 58,) made it a felony for any person whilst a director, engineer, clerk, secretary, 1 reasurer, or any other, officer, agent, employee or servant, of any railroad company, to either directly or indirectly be a contractor, or directly or indirectly receive any profits, portions, proceeds, commissions or charges, whatever,-of any contractor; on account of any contract for -the .construction, building, grading or repairing of any railroad belonging to such company. And/the .next section, 59,
The testimony showed to the satisfaction of the circuit court, and but little reason is discovered to doubt the correctness of its conclusions, that in the contract made, nominally between Hamilton and the railroad company, Sexton, the vice-president and a director of the company, was, if not the real party in interest, interested largely in the contract, and Brayman, the president, was also interested. If this was the case, them, according to the express statutory provisions, the contract is null and incapable of enforcement. It will not do to say this is not a suit upon the construction contract; this may be true, but it is a suit upon the written promises of'the company, and the consideration of those promises is, in part, at least, illegal, based, in part, at least, upon a consideration which the law will not recognize.- Mr. Justice Story says : “ When the' consideration is illegal in part, then it avoids the note in into,” (Story Prom. Notes, § 190.) and the same learned author says elsewhere, that the consideration of a note will be illegal either because against the general principles and doctrines of the common law, or because specially prohibited by statute. Id., 189 Language could scarcely be more thoroughly prohibitory of any given act than that of the statute above quoted, and if it would not apply to a case of this sort, it would seem difficult to imagine one where it would apply. If it does apply, then of necessity, the consideration of the bonds being illegal, no recovery can be had upon them, unless, indeed, we are prepared to turn our backs upon the statutes. And it is a matter of no moment that the bonds bear a date anterior to that of the construction contract; otherwise, the provisions of the statute could be easily evaded by simply antedating the written security based upon the illegal consideration. A similar point was so ruled in Williams v. Wall, 60 Mo. 318.
But it is strenuously asserted that the claim of Hamilton against the railroad company, oven if illegal, has been “adjusted” and purged of its illegality in consequence of the bonds having been received by him of the company. I do not take this view, for the bonds were merely the promises of the company to pay; and the question of illegality of consideration could be raised at any time prior to payment, as much so as if the bonds had been given for a gaming or other illegal consideration. For these reasons I and of opinion, in which Judge Norton concurs, that the judgment of the circuit court, as to the remaining 50 bonds, should be affirmed. The majority of this court are, however, of a different opinion, and in consequence, the judgment as to those bonds must be reversed, and on return of
In regard to that portion of the judgment respecting the 581 bonds, and which -went -against the plaintiff, we affirm the same,- and remand this cause to be proceeded with as herein indicated.
Section 00 reads as follows:' “The provisions of the last two sections shall apply only to railroad corporations and companies for which the credit of the State is, by some act of the" Legislature, in some way engaged.”
Concurrence Opinion
Section 58 denounces no contract, but one by which an officer or employee of the company becomes a party to or a participant in the profits or proceeds of a contract for the construction, building, grading or repairing of the road. Here Hamilton was the contractor. Sexton and Brayman were not parties to Hamilton’s contract with the company. The agreement by which they were to have an-interest in that contract was collateral to it; and while they might
The first clause of section 59 declares ineligible as a
If such a construction is to prevail, no one would be safe in making a contract with a railroad company, for the most diligent inquiry to ascertain if any director had been guilty of a violation of section 58 would most probably be unavailing, as a director concerned in a contract in disregard of that section, would be interested and anxious to conceal it to avoid a criminal prosecution. So if the construction of the two sections prevails, which our associates favor, then not only is Hamilton’s contract void, but all sub-contracts made by him, and all contracts made by such sub-contractors with teamsters and day-laborers are also null and void. A construction of these sections which would work such manifest injustice in hundreds of eases which might be supposed, in addition to those already suggested, should not be adopted, unless it be clearly indicated by their phraseology. The express terms of the statute, as we have seen, do not declare, nor is it a necessary implication from any words employed in either section, or demanded by the spirit and purpose of the act, that any contract shall be affected by the provisions of those see-
Rehearing
It is not meant to convey the idea that the mere failure to plead to the jurisdiction of the court would have the effect to confer jurisdiction where none existed before; for it is well settled that even consent of parties cannot confer jurisdiction. Stone v. Corbett, 20 Mo. 350. But all circuit courts have a general jurisdiction over the foreclosure of mortgages. This is proven' by the fact that changes of venue may be taken by consent of parties to distant counties and circuits in the prosecution of foreclosure proceedings, as well as in other suits. 2 Wag. Stat., § 4, p. 1005. That the circuit court of Mississippi county was of opinion it had cognizance of the cause, is conclusively shown by the fact that it proceeded to judgment therein. As was said in a somewhat analogous case, the bolding cognizance of the cause was a “judicial assertion” of the right so to do. Bouldin v. Ewart, 63 Mo. 330. After a court, which has general jurisdiction over a certain class of causes, proceeds without objection to the hearing and determination of a cause belonging to that class, it is quite too late in this court to raise objections to the irregular exercise of such jurisdiction ; such objections, even if originally valid, lose their force when waived by pleading to the merits. And we can discover no difference in princi