82 W. Va. 186 | W. Va. | 1918
The only questions, as we view the ease, fairly arising upon the record and of which we will take cognizance, are presented by the errors and counter errors assigned and relied on by appellant and appellees.
Three preliminary questions involve the sufficiency of the bill: First, is the bill defective for want of necessary parties ? Second, is it multifa'rious ? Third, is relief barred by laches or limitation ? All three questions were presented by the demurrer overruled bj^ the circuit court.
Plaintiff predicated its right to the relief sought on conspiracy to defraud it in the sale to and purchase by it in 1903 of one thousand acres of coal and mining rights in Barbour County, originally conceived and perpetrated on it by its directors Knupfer, Berchfcold, Scott, Clark, and Peters, and certain of its other officers and agents, and participated in by the defendant S. L. O’Neal, who, as part of the scheme, was to be and was made a director, and subsequently joined in by the defendants Lucy O’Neal, wife of said S. L. O’Neal, and by her brothers, the defendants J. L. and J. H. Knapp, -if not also by the defendant the First National Bank of Philippi and others.
The main purposes of the bill were to clear up the title to the coal purchased by requiring defendants to surrender the purchase money notes, some of them executed by F. L. O’Neal, a nephew of S. L. O’Neal, to the original land owners, and the others by said Knupfer to said F. L. O’Neal, representing the conspirators, alleged to have been paid off and discharged out of moneys paid through said Knupfer to -’said S. L. O’Neal, or his wife Lucy O’Neal, and held by alleged assignments thereof to some of defendants, and to obtain releases of said liens, and also to obtain a surrender and cancellation of the shares of stock of the plaintiff, fraudulently issued to the said S. L. 0 ’Neal and Lucy 0 ’Neal, as part of the fraud and conspiracy aforesaid, and for an accounting by said S.
With these general objects and purposes in view, it is contended by the demurrants, though the demurrer was general and not special, that Knupfer, Clark, Scott, Peters, and Berehtold, and also the original vendors of said coal, were necessary and proper parties to the bill. We do not think this point of demurrer is well founded. The bill alleges that Knupfer, Clark, Scott, Peters, and Berehtold, had each surrendered the benefits and all the benefits which they had received, so that no relief could be and none was demanded of them on this ground. And, moreover, so far as the allegations of the bill go, these parties had accounted to the other defendants for all moneys which had been paid to them; so that they have no rights or interests to prosecute or defend rendering them necessary parties, nor can they be materially interested in any decree that was or could be properly pronounced in the cause, wherefore not necessary parties. Bragg v. United Thacker Coal Co., 70 W. Va. 655. The general rule that all persons interested in the subject matter of’ the suit should be made parties to the bill, either as plaintiffs or defendants, as laid down in Beckwith v. Laing, 66 W. Va. 246, is inapplicable.
But were the original or subsequent vendors having vendor’s liens reserved in the deeds in question necessary parties? The bill prays that the present claimants and holders of the notes, the Knapps and others, be required to surrender the notes for cancellation and release the liens. It does not appear that the vendors have or will decline to join in such releases. The statute, section 2, chapter 76, requires the as-
Now with respect to the question of multifariousness relied upon. The rule against multifariousness is generally regarded as one of convenience. And where the matters contained in the bill are not wholly distinct and separate, and it is more convenient to litigate and dispose of them in one suit than in two or more, and this can be done without injustice to any one, the objection of multifariousness will be disregarded. Johnson v. Sanger, 49 W. Va. 405; Dillard v. Dillard, 97 Va. 434; Dudley v. Niswander, 65 W. Va. 461; Pack v. Whitaker, 110 Va. 122; Johnson v. Black, 103 Va. 477; Ross v. Ross, 72 W. Va. 640. And as was said in Baker v. Berry Hill etc. Co., 109 Va. 776, in cases involving the question of fraud, a very great latitude is allowed in pleading, both as to the circumstances charged and parties impleaded, provided one connected scheme of fraud be averred.
On the subject of laches and limitations we think the bill alleging as it does prompt action as soon as the fraud was discovered, sufficiently negatives that defense.
On the merits both parties first complain of the decree in favor of the plaintiff against S. L. O’Neal for $7,491.86; the plaintiff that the decree should have included also $3,000.00 in round numbers, which S. L. O’Neal, who claimed to own and control options on the coal, fraudulently agreed to allow to Knupfer and Peters, then directors, and subsequently co-directors with him, in the plaintiff company, as commissions or compensation for putting through the fraudulent agree
The basis of this decree was, and the court therein found as a fact, that fraud and conspiracy had been practiced upon the plaintiff company substantially as alleged in the bill; that the coal which O ’Neal by option contracts had contracted for with the original owners, at $22.00 per acre, and by a fraudulent agreement had conveyed to a syndicate, of which he was one of the members, at $30.00 per acre, with a secret agreement with Knupfer and Peters, to allow and pay them at the rate of $3.00 per acre, as a profit or commission, for negotiating the scheme, the syndicate had unloaded upon the plaintiff company, at the rate of $100.00 per acre, or in round numbers $100,000.00, but subsequently modified by an agreement to accept $50,000.00 in cash, and $50,000.00 in stock of the plaintiff company. And the amount so .decreed against said O’Neal was the difference between the sum of $37,666.00, which the court found had been paid to him, and the sum which he should have received for the coal and surface land covered by the contract, at the rate of $30.00 per acre for the coal, and 56 acres of surface at the rate of $40.00 per acre, and deducting $4,398.56, for the Grim coal, of 146 acres lost to the plaintiff, by the negligence of the said O’Neal, as alleged in the bill.
If O ’Neal was guilty as alleged and found by the court, of aiding and abetting his co-conspirators in unloading upon plaintiff coal and surface. lands which cost him but $22.00 per acre, we do not see why he was not liable to plaintiff for all the money which he received over and above the twenty seven thousand odd dollars, which the property would have netted him; his profits on the coal would then have been the difference beriveen $22.00 per acre and $27.00, or $5.00 per aei'e. The fraudulent agreement which he entered into with his associates, howover, was that he was to share with them
We, therefore, affirm the point of error by the plaintiff, as to this part of the decree, and deny that of O’Neal.
The second point of error urged by appellant relates to a note of October 10, 1904, for $2,772.75, executed by F. L. O’Neal to Lucy O’Neal, and held by the First National Bank of Philippi as collateral security for a certain note of
The next point to be disposed of is that the decree erroneously adjudged and ordered that the defendant J. L. Knapp was the owner and holder for value of the following notes 'executed by said F. L. O’Neal, and which S. L. O’Neal and others, members of said syndicate, were obligated to pay, namely: A note of June 21, 1904, given to David L. Thrash for $1,000.00, subject to certain credits; one of May 28, 1904, given to Zoa H. Malcolm, for $2,000.00; one of June 18, 1904, given to Mary E. Green, for $153.00; one of August 6, 1904, to Edwin C. Wells for $201.00; one of June 18, 1904, to J. Ed Malcolm, for $305.50, subject to certain credits; one of June 18, 1904, to J. E. Strader, Executor, for $716.88, and
It is contended on behalf of Knapp that the relationship of brother-in-law and sister does not preclude dealings between
But the case cited while not denying to persons standing to each other in such relationship the right to deal with each other- without presumption of fraud against them, it does hold that such relationship calls upon the court for careful and close scrutiny of the transactions and conduct of and evidence offered by such persons, and that to sustain the claim of payment of large sums of money the testimony of such claimant, if uncorroborated by reeeits, memoranda, or other documentary evidence, must be clear, positive, definite, consistent with other evidence offered, and free from contradiction. Knapp does-not claim to have purchased these notes directly, but through S. L. O’Neal, his agent, by power of attorney to do so, and that from time to time he placed funds in his hands to buy the notes in question. But-where did the funds come from, and if provided, why put them to the credit of Lucy O’Neal? Knapp and his brother J. H. Knapp, swear that the money used represented loans which the latter had arranged with a Parkersburg insurance company, of which he was then an officer, and with the Baptist Education Society, of which he was treasurer. But the officers of the insurance company swear it was not the business of said company to loan money, and that its records and books disclose no such loan, and no note, check, receipt, voucher, or other documentary evidence was produced showing any loan to said Knapp by said Baptist Education Society.
True the record shows that Knapp claims to have purchased from F. L. O’Neal some $9,000.00 of the Knupfer notes, executed to F. L. O’Neal, and that some of the money paid on those notes may have gone to the credit of Lucy O’Neal in the bank, but F. L. O’Neal was the mere agent of S. L. O’Neal and others to do their bidding. Knapp fails to show
The next point is that the court erred in decreeing that the defendant J. IT. Knapp, another brother-in-law of said 0 ’Neal was the owner in good faith for value of other of said purchase money notes of said F. L. 0 ’Neal as follows: First, a note of May 28, 1904, for $2,000.00, given to Zoa H. Malcolm; second, a note of January 21, 1904, for $1,000.00, executed to David L. Thrash; third, a note of June 27, 1904, for $1264.50, given to L. C. Criss. To establish fraud on the part of Knapp and the O’Neals in respect to these notes appellant relies in part on the same facts disclosed in relation to the notes claimed by J. L. Knapp. The method of paying for these notes was different from that adopted in the payment of the notes claimed by J. L. Knapp, but the transactions were conducted, in part at least, through S. L. O’Neal.
With respect to the Zoa H. Malcolm note, the evidence shows that Knapp paid through the Union Trust and Deposit Company, of Parkersburg, a draft for $1,900.00, drawn upon
Next, as to the David L. Thrash note. Knapp swears that he also borrowed the money to buy this note from the Baptist Education Society, and paid for it in substantially the same way, the draft drawn on him in this instance being for
With respect to the L. C. Criss note for $1264.50, subject to credits reducing it to about $500.00, the evidence going to establish fraud is not so clear. Appellant’s counsel say little about it. Knapp says he paid $475.00 for this note, but the balance due thereon was $500.00, and that he borrowed the money to buy it from the estate of Thomas E. Davis; but he produces no note, check, draft, or other documentary evidence of such loan. The only documentary evidence of his owner-' ship was his possession and production of the note before the notary taking his deposition; and if his supposed indebtedness to the Davis estate was represented by any note or other paper obligation he failed to produce the same, or any evidence of the repayment thereof, or explain or account for their absence. In view of his relationship to the parties to the transaction, and considered in connection with the evidence of his fraudulent transaction with respect to the two other notes claimed by him and the manifest design and purpose of the O ’Neals to defraud the appellant by keeping said purchase money notes alive in the hands of their friends and relatives and impose on it the burden of re-payment thereof, we are disposed to hold upon well recognized principles of evidence that the whole of these transactions, relating to the purchase money notes, including this Criss note, were fraudulent and that the latter note in the hands of said Knapp ought to be
The last point of error relied on by appellant is that the court should have decreed an accounting by Lucy O’Neal. If the point is well founded, as we think it is, it should have also decreed an accounting by S. L. O’Neal, for the evidence satifics us, that the account standing in her name, and into which thousands of dollars paid by appellant went, was in fact S. L. O’Neal’s account, and that he simply used her name with her consent to further his fraudulent purposes, and that both are liable to account therefor, beyond the amount to which he was lawfully entitled by the principles of this decision.
Apparently as a last effort.to save herself from liability Lucy 0 ’Neal filed an amended answer pleading infancy. But by filing her joint answer after she reached her majority she ratified all previous contracts. Besides after she became of age she received or had placed to her credit more than $15,-000.00, the proceeds of checks given by Knupfer out of money provided by appellant. So her plea is not good to defeat relief against her, and was properly denied by the circuit court. Phillips on Pleading, section 240; Hobbs v. Hinton Foundry, Machine & Plumbing Co., 74 W. Va. 443. Where an infant has once ratified his contracts after arriving at full age he can never afterwards elect to hold them void. Gillespie v. Bailey, 12 W. Va. 70.
Having reached these conclusions, the question comes what decree should be pronounced here. As the matters involved are more or less complicated, and having settled the principles of the cause, we have concluded to reverse the decree in toto and to remand the cause with directions to the circuit court
Reversed and remanded.