Stockbridge v. Mixer

227 Mass. 501 | Mass. | 1917

Pierce, J.

The plaintiff on December 9, 1909, brought this bill in equity under R. L. c. 159, § 3, cl. 7, to establish a debt alleged to be owing to him for legal services from the defendants, J. Frank and William A. Mixer, as copartners under the name of Mixer Brothers and to reach and apply in payment thereof certain property of the copartnership, to wit, certificates of stock of a Maine corporation then held by the defendant bank under an agreement to return the stock on demand to Mixer in case the defendant Hayes should fail to carry out on or before December 12, 1909, the terms of an agreement and option of purchase, under seal, executed by and between J. Frank Mixer and Alfred S. Hayes, May 29, 1909; and in the alternative should Hayes on or before December 12, 1909, elect to pay the sum of $121,500, the sum under the option to be paid on or before that day, with interest thereon as provided in said agreement, and should elect to demand and receive from the defendant bank the shares of stock, then and in that case the plaintiff seeks to apply so much of said sum as shall be sufficient to secure the payment of the indebtedness due from the defendants J. Frank and William A. Mixer, as the same may be determined and ascertained.

On December 10, 1909, upon due notice and hearing, an ad interim injunction issued in substance restraining the defendants Mixer from demanding and receiving the shares of stock in the custody of the bank, and directing Hayes in case he shall elect to purchase the stock to retain of the purchase money otherwise payable by him to the defendants Mixer the sum of $10,000 until the further order of the court.

The defendant Hayes on February 3, 1910, in answer to the allegations of the plaintiff’s bill “. . . says he has no interest in said controversy except that he holds ten thousand dollars ($10,000) in accordance with and subject to the order of the court.” The defendants Mixer in their several answers to the bill of complaint and to the amended bill of complaint, by way of demurrer contend first, that the bill of complaint does not allege facts entitling the plaintiff to any relief in equity; and, second, that the plaintiff has a plain and adequate remedy at law.

At the time the bill of complaint was brought and at the time the injunction issued as above set forth, the defendant, the Metropolitan National Bank held thirty thousand shares of the Mixer Brothers Company, a corporation organized under the laws of the State of Maine, subject to the terms and conditions of an agreement under seal between J. Frank Mixer and Alfred S. Hayes, dated May 29,1909. By the terms of that contract Mixer agreed to deposit all of said stock, together with a copy of the agreement with Hayes, with the bank on or before June 2, 1909, upon the simultaneous payment by Hayes to him of $2,500. As appears by the evidence the money was paid to Mixer and the stock was deposited with the bank to be held by the bank subject to the terms and conditions of the agreement. The agreement further provided that the bank should have a lien on the stock for the payment of its services as custodian and for other expenses referred to in the agreement, and that it should deliver all the shares of stock to Hayes or to his order should Hayes in performance of the terms of the agreement elect to pay to Mixer $7,500 on or before June 12, 1909, $3,500 on or before July 12,1909, and $121,500 on or before December 12, 1909. At the time this bill was filed it further appeared that Hayes had made payment of the instalments to be paid in June and July, and that he proposed and intended on or before December 17, 1909, to make the final payment and to demand and receive from the defendant bank the said thirty thousand shares of stock.

The demurrer was overruled rightly. Lord v. Harte, 118 Mass. 271. The certificates of stock in the custody of the bank could not have been attached in an action at law because a sale on execution of the shares would not convey any interest in the stock as stock. They were not chattels, subject to seizure on trustee process, for a like reason and because the right of Mixer to have the shares of stock redelivered by the bank was contingent on the discharge of any lien of the bank created by the agreement, and upon the non-exercise of the terms of the option granted to Hayes.

The alternative, contingent and vested rights of Mixer to a redelivery of the shares of stock and the right to receive money in place of the stock from Hayes, in case the option of purchase was exercised, were valuable rights which a creditor of Mixer could not enforce through the remedies of an action at law. Upon the service of the injunction the plaintiff acquired an equitable lien upon the rights of Mixer to the shares of stock, in the custody of the bank and to the proceeds of the shares of stock which he could follow and enforce. Wiggin v. Heywood, 118 Mass. 514. Worcester v. Boston, 179 Mass. 41. Snyder v. Smith, 185 Mass. 58. It is plain that any remedy at law would be imperfect, and that the court acquired jurisdiction with the filing of the bill to proceed under R. L. c. 159, § 3, cl. 7, which was not lost by the later exercise of the option. Campbell & Zell Co. v. Barr Pumping Engine Co. 182 Mass. 304, 306. Rosen v. Mayer, 224 Mass. 494. Leavitt v. Dimond, ante, 216. Milkman v. Ordway, 106 Mass. 232. See Haskell v. Waties, 2 Rich Eq. 8. Sarter v. Gordon, 2 Hill Eq. 121.

The appeals from the- order of reference to a master, from the order overruling a motion to recommit to the master, from an order vacating a former order discharging the reference to a master, and from the interlocutory decree “. . . that the master’s report now on file be treated as an auditor’s report at the trial of said cause upon issues framed for a jury” must be overruled.

The reference to a master in a suit in equity and the appointment of an auditor in an action at law are matters for the exercise of judicial discretion, which ordinarily is not subject to revision on appeal or exception. Bradley v. Borden, 223 Mass. 575, 586. Fair v. Manhattan Ins. Co. 112 Mass. 320. The motion to recommit in either case likewise is a matter of discretion. Tobin v. Kells, 207 Mass. 304, 310. The formal error of reference to a master in an action at law is cured by an order that the master’s report shall be treated as and have the force of an auditor’s report. Falmouth v. Falmouth Water Co. 180 Mass. 325. Norwood, petitioner, 183 Mass. 147. Gray v. Chase, 184 Mass. 444. Because objections cannot be taken to an auditor’s report, it necessarily follows that exceptions founded thereon cannot be considered and must be discharged when the report of a master becomes an auditor’s report. Eagan v. Luby, 133 Mass. 543. Moore v. Dugan, 179 Mass. 153.

In the case at bar it is not contended that the report considered as an auditor’s report is in any respect insufficient. No motion was made to recommit the report as an auditor’s report and no exceptions were taken to rulings or to a refusal to make rulings as to the effect to be given to that report by the jury.

On March 29, 1909, the plaintiff sent a statement to “The Mixer Bros. Company,” for the “amount due for professional services in devising plan for sale of the property of Mixer Bros., organizing the Mixer Bros. Co. . . . from February 9th, 1909, to date — $250.00.” On the same day the plaintiff sent a letter of explanation “as to the amount which I have charged for services” to J. Frank Mixer. It is the contention of the defendants that all services performed by the plaintiff for Mixer Brothers, individually or as a firm, or for the corporation of Mixer Brothers Company prior to March 29, 1909, were intended to be included and charged in that statement and that this understanding was borne out by the letter of the plaintiff dated March 29,1909. It is the further contention of the defendants that “the bill of March 29, 1909, became an account stated between the parties” by the acceptance of the bill and by the partial payments made thereon. On the other hand the plaintiff claimed that the account was rendered to the corporation as a proper charge against it, and in support thereof introduced in evidence a vote of the board of' directors, passed March 11, 1909, with the approval of J. Frank Mixer, which reads, “Upon motion duly seconded it was voted that the treasurer be authorized to pay a sum not exceeding three hundred dollars to cover the expense of organization and matters incidental thereto.” The élaim against the defendants is for services and for devising the plan or scheme whereby the rights, the ownership of the property which Mixer Brothers owned, could be sold, could be made vendible, could be made in such a way they could be sold and carry with them the essential, valuable right to use them. A consideration of the reported conflicting testimony leads to the conclusion that there was evidence to warrant the finding of the jury that the services were performed by the plaintiff for the defendant, Mixer Brothers, individually, and that they were not included, and were not understood to be included, in the bill rendered to the corporation.

The request numbered 1 to rule “That there is not sufficient evidence to warrant a finding that the business of Mixer Brothers was unsalable or not vendible previous to the rendition of the services by the plaintiff” could not have been given as a matter of law. There was ample evidence that the business of Mixer Brothers before incorporation was not vendible in the sense the plaintiff was employed by the defendants to make it salable.

The requests numbered 2, 3, 4, 5, 8, 9 and 10, could not have been given in form. In substance they were given in instructions not excepted to.

Requests numbered 6 and 7 relate to the value of the services rendered at the time of the bringing of the action. It was admitted by the defendants that if the jury were satisfied under the instructions from the court that everything was done by the plaintiff which he says was done and in the manner and way in which he says it was done, then the charge he made was fair and reasonable. As the jury found for the plaintiff under full instructions in this regard, not excepted to, it must be assumed that they found that the plaintiff had performed and rendered the services in manner and form as claimed.

The admission of evidence to show the circumstances under which the letter of March 29,1909, was sent to Mixer, was proper. The letter was put in evidence by the defendants and unexplained was an admission of the value placed by the plaintiff on his services up to that date. It also was evidence of an implied agreement of an account stated. We think the evidence was admissible in connection with the other fact in evidence, to prove that the plaintiff and the defendants understood that the bill rendered to the corporation was not intended to include all claims against Mixer Brothers individually. Butler v. Butler, 225 Mass. 22, 25.

In the absence of an offer of proof it cannot be said that the testimony of Hoyt as to what J. Frank Mixer did in regard to the sale on May 28, 1909, was excluded wrongly. Cecconi v. Rodden, 147 Mass. 164, 169.

The conversation between Mr. Eaton and the plaintiff was admitted rightly. Eaton had been requested by the defendants to see the plaintiff, and the conversation objected to was had in pursuance of that request. Gott v. Dinsmore, 111 Mass. 45. See Proctor v. Old Colony Railroad, 154 Mass. 251. The conversation of the plaintiff with Mr. Eaton was in the nature of acts intended to demonstrate the feasibility of the scheme alleged to have been devised by the plaintiff at the requests of the defendants; and it was also relevant as tending to prove that the plaintiff had originated the plan and not the defendants as they claimed to have done with the assistance óf other people than the plaintiff.

The ruling that "the plaintiff is entitled to recover the full value of all his services rendered less such sums as he has received from the defendants and the corporation, and whether the plaintiff did or did not include all services in bill of March 29th,” was properly given when considered in connection with other portions of the charge defining the rights and obligations of the parties.

The equitable lien in favor of the plaintiff, which attached to the stock in the custody of the bank upon the service of the injunction upon Mixer Brothers and Hayes, followed the proceeds to the extent of $10,000 upon the election of Hayes to purchase the stock from the defendants Mixer. Upon the death of Hayes and the insolvency of his estate, the claim should be as it was presented to the commissioners. Guptill v. Ayer, 149 Mass. 49, 52. Snyder v. Smith, supra. Rioux v. Cronin, 222 Mass. 131, 139.

The entry must be: Exceptions overruled. Decree to be entered to conform to the order for a final decree.

So ordered.