Widner v. Olmstead

| Mich. | Apr 4, 1866

Christiancy J.

These two cases being closely connected in their facts, will be considered together.

The complainant, who is the wife of Moses B. Widner, was, on the 22d day of February, 1854, the owner in fee of an eighty acre lot, in the township of Huron, in the county of Wayne, upon which there was a steam saw .mill, erected mainly with her money, but the engine and boiler in which seem to have been obtained on the credit of the husband, with certain chattel mortgages thereon, as collateral security. On that day the husband in his own name entered into a certain contract by deed with defendant Olmstead, by which he, “for himself, his heirs, administrators and assigns,” purports to sell and convey to Olmstead, “ his heirs, assigns and administrators, the equal undivided half of his steam saw mill, together with all its fixtures, tools, implements anti appurtenances thereto belonging,” describing its location, and “ further agrees to lease and let the equal one undivided half of the mill-yard, consisting of three acres of ground, to be used by said Olmstead as long as the premises shall be used for a mill, which premises shall always be free to be used in common by either or both parties, so long as either or both parties shall want to occupy the ground with a mill; upon the following conditions, viz: “ the said Olmstead agrees for himself, his heirs, assigns and administrators, to pay to said Widner, his heirs and assigns, the sum of nine hundred and fifty dollars ($950) as follows; one hundred and fifty dollars at this date; secondly, he is to pay J. & J. Brainard the amount due for the boiler now in said mill, supposed to amount to about four hundred and fifty dollars ($450); thirdly, two hundred dollars ($200) to be paid by the first day of June next, and the residue to be paid on, or before the first day of October next. It is further understood by both parties that they be, on and after this date, equal partners in the said mill, without hindrance or opposition, one from the other; they are to share equal and alike, both as to gain and loss, and to be at equal expense in running said mill.”

Olmstead and complainant’s husband went into business and carried on said mill as partners, under said agreement, for some time, and then rented it to their sons.

On the 10th day of September, 1859, complainant and her husband entered into a contract with the defendant, David Lane, by which upon certain terms and conditions they purport to convey to Lane the other undivided half of said saw mill, machinery, &c.; and agreed to rent him the undivided half of two acres of the ground on which the mill stands, for which Lane agrees to put the mill in order, and to pay one thousand dollars in sawing, as therein specially provided. This agreement,'however, though awkwardly worded, when fairly construed, may perhaps amount merely to a conditional sale, to become absolute only on payment by Lane.

After this conveyance to Lane, he and Olmstead ran the mill together, and finding the old engine (originally in the mill at and before the sale to Olmstead) worthless of unfit for use, sold the same or some parts of it as old iron, for which they realized $42, and purchased a new engine from defendant, Vanderbilt, January 16, 1861, for which they agreed to pay $550 in instalments, (none of which had become due when Vanderbilt’s answers in these cases were filed,) and for which they executed a chattel mortgage in the usual form upon the engine so purchased, and also upon the steam boiler in said mill with all the tools, fixtures and appurtenances therein. It may be loosely inferred from the mortgage and the evidence, though nothing is said upon the point in the pleadings, that the boiler was the same originally in the mill before the sale to Olmstead; but the bill does not place complainant’s lien for purchase money upon any such ground, nor upon any ground different from that upon the engine and tools; nor is there any allegation that it was attached to the freehold, in any other manner than the engine.

The bill in the first entitled case is for the enforcement of complainant’s lien for the purchase money claimed to be due from Olmstead under his contract above set foi’th; and the object of the bill in the second case is for the enforcement of a similar lien for the purchase price due from Lane under the contract with him; treating the lien in each case as an equitable mortgage. Lane is only made a party to the first bill under an allegation that he claims some interest under Olmstead, and is charged in common with Olmstead with having sold the old engine and iron, and replaced them with others, and with the intention of removing the engine, machinery and boiler, and even the mill, from the premises to avoid complainant’s lien, and to the prejudice of her security. Olmstead is made a party in the second bill only as claiming some interest under Lane, and charged in common with Lane with the design of removing the engine, &c. Vanderbilt in both cases is made a party only in respect to his chattel mortgage, and the bills claim that the engine and other mortgaged property had become and were a part of the real estate, and subject to complainant’s prior lien for the purchase money; but no distinction is made between the engine and the other mortgaged property. Both bills pray for the enforcement of her lien for purchase money, as prior to any lien of Vanderbilt, and for a decree of foreclosure and sale as in case of the foreclosure of mortgages ; and each prays for an injunction to restrain said Lane and Olmstead, and all acting under them, from removing said mill and machinery of selling the same. They also pray for an injunction against Vanderbilt to restrain him from removing or detaching from the lot “ the property, tools and fixtures” mortgaged to him. The remedy by injunction, here sought, is merely subsidiary to the main object of the bill — the enforcement of her lien as a security for the purchase money; and no proper ground is laid for an injunction as an independent remedy. Her right to the injunction will therefore depend upon her right to enforce in these suits her lien for the purchase money, and must stand or fall with it.

Olmstead answers both bills, relying upon the conveyance by comjDlainant’s husband and his agreement therein as above set forth, claiming the validity of all its provisions, and insisting that complainant cannot affirm a part of it without affirming the whole; alleges full payment of the purchase money; that nothing is due thereon; specifies the various payments and sums claimed to apply in the nature of offsets, — all of which would properly apply on the purchase money, either as payment or offsets, if the provision for a partnership between him and complainant’s husband be held valid as to her; admits that he went into partnership with the husband under the agreement; denies that he has threatened, or intends to remove the mill or machinery; avers that the matters growing out of said contract, between him and the husband, have not been settled, that upon a just settlement of the same a large sum would be due to him, Olmstead; insists that it appears from the bill that Moses B. Widner, the husband of complainant, is a necessary party, and prays the benefit of a demurrer.

Lane answers both bills, setting up the instrument executed by complainant and husband to him; averring that he has fully performed its conditions, so far as depended upon him, and his readiness at all times to pay in sawing-, but that the logs were not furnished; denying that the engine and machinery were a part of the real estate, or that he threatened or intended to remove the same. His answer need not be further stated, for reasons which will presently appear.

Vanderbilt answers both bills, setting up his mortgage and insisting upon its validity as against any lien in favor of complainant.

In this stage of these eases, a settlement seems to have been made between complainant and defendant, Lane; and the latter assigns his interest in the property in question to the complainant; and thereupon the complainant’s solicitor, upon an affidavit of these facts, and that Lane consents thereto, enters an order taking the bill in each case as confessed as against Lane, but without costs.

By this assignment, we apprehend, Lane ceased to be a party, his whole interest having been transferred to the complainant. She could not be both complainant and defendant, as to that interest, and the effect was equivalent to a dismissal of the bills as to him, and no decree could thereafter be taken against him under either bill; and the whole suit in the case brought for the enforcement of complainant’s claim for the purchase money due from Mm, [the second bill] was terminated as to all the parties. There was no longer any purchase money due from him, and therefore no lien for it to be enforced as against any of the parties. This therefore disposes of that case, and leaves' for our consideration only the questions arising between complainant, and.Olmstead and Vanderbilt under the bill founded upon the claim for purchase money under the contract with Olmstead.

These' questions will be found to depend mainly upon the pleadings. The .bill sets out the agreement between complainant’s husband and Olmstead; avers that, though made by and in the name of the husband only, it was in fact made by him for and on behalf of the complainant, except the stipulation therein for a partnership; that wishing to have said contract in her own name, she, on the sixteenth day of March, 1861, obtained from her husband a full assignment thereof, and of all rights tinder the same, to one G. M. Mills, who on the same day assigned the same and all lights under it to the complainant, “ whereby she became the owner of said contract, and all rights under the same, except as to the partnership." The assignments make no such exception, but she avers they weze not intended to cover and did not cover any lights pertaining to the partnership, in which she avers she had no interest. She avers there is due to her “ by virtue of the lien created by said contract, and also for the said purchase money independent of the contract,” [the latter phrase is not easily comprehended in this connection] “ a balance of two hundred and forty dollars, with interest thereon, besides the item of four hundred and fifty dollars, mentioned in said contract, for the payment of which she files this bill •” claims she has an equitable lien and mortgage for this purchase money, not only in and by the contract, but also by the rules established in courts of equity. She distinctly admits and avers that her husband, and defendant Olmstead, “went on for several months with their .partnership affairs, as mentioned and provided for in said contract,” and this also appears from the evidence. There is no allegation that the partnership had ever been settled, or a balance ascertained. Olmstead, in his answei’, insists they had not, and there is no evidence of such settlement, but the contrary is to be clearly inferred. Olmstead sets up vaiious payments made by him, which would apply on partnership account or as an offset, (if the complainant is not allowed to repudiate that portion of the agreement,) which he insists more than pay the amount of the purchase money, and without passing upon the evidence it is sufficient to say here, that it tends to establish these averments of Olmstead.

It is clear from this statement, that complainant, in attempting to establish her lien for the purchase money claimed to be due from Olmstead, rests that claim upon the written agreement made by her husband with Olmstead, and that it can have no other foundation upon the facts stated; that she claims, and can only claim, through and under that agreement, and has undertaken for that purpose to affirm that agreement as to the sale, the use of the property, and the amounts and terms of payment of the purchase money, but to repudiate it as to the provision for a partnership between her husband and Olmstead in the mill, and in the stocking and running of it. This she cannot be allowed to do. She cannot select out and affirm the provisions which operate in her favor, and reject those which may operate to her prejudice. She must affirm the whole or reject the whole. The agreement is one entire thing, and all its provisions are to be taken together. No court can be authorized to say that Olmstead would have consented to the purchase, or the amount or terms of payment, or any other of its provisions, if that in reference to the partnership had been left out. This may have been his chief inducement.

This is not the ordinary case of a person without previous authority assuming to act as the agent of another, and in his name in the making of a contract, where the person ’ in whose name the contract is made may by subsequent ratification render it to all intents and purposes a contract between himself and the other party, and hold the latter directly liable upon it. The contract in this instance is by deed. The complainant is not named in it. The husband does not assume or purport to act in her behalf, or that of any other person. He purports to deal with the property as his own, describes the mill as his, executes the instrument and makes all the stipulations in his own name. If she affirms this instrument she affirms the transaction witnessed by it; and it would seem, upon principle, that she must, so far as any equity of Olmstead may have accrued under it, or any act done by him on the faith of it, affirm it as it was, — as the contract of the husband. (Saunderson v. Griffiths, 5 B. & C. 909, 915 ; S. C. 8 D. & R. 643; Evans v. Wells, 22 Wend. 324; Pinckney v. Hagadorn, I Duer, 89; Andrews v. Estes, 2 Fairf. 267; Lucas v. De La Cour, 1 M. & Sel. 249; Hamble v. Hunter, 12 Q. B. 310; New Eng. Ins. Co. v. De Wolf, 8 Pick. 56.) Such affirmance must, we think, to the extent above stated at least, be treated as a previous assent on her part that her husband should thus deal with Olmstead, and that the latter might deal with the husband as the owner, and that she would be bound by the husband’s acts.

But the broad question is not presented in this case, whether by an affirmance of this instrument, she could make it a contract in any sense between herself and Olmstead, or claim any rights under it as against him, without an assignment. (As assignee she could stand in the rights of her husband only.) It is sufficient for the present case, that her affirmance of the instrument would, in our opinion, operate as an affirmance of the partnership, and of the rights of Olmstead as a partner under the agreement, and her rights would depend upon the prior settlement of the partnership accounts; and for this purpose her husband is a necessary party.

It might possibly admit of a question whether complainant’s bill in the present case, expressly affirming the contract in other respects, but repudiating it as to the partnership, could for all purposes be treated as an affirmance; though, as she claims a benefit under it, I am inclined to the opinion that it might; and her bill in the other case, where Lane is the principal defendant, contains a reference to the rights of Olmstead in the property, which looks much like an unqualified affirmance. And her own testimony as well as that of her husband and her daughter, — all of whom testify that she declared she would carry out the agreements of her husband,— have some bearing in the same direction. But the point is wholly immaterial here, and we give no definite opinion upon it; since she must be considered as having affirmed the whole, or repudiated the whole. If she repudiates the whole, then there has been no sale to Olmstead; he owes nothing for purchase money; her remedy at law is complete, and her bill must be dismissed. If she affirms the whole, she affirms the partnership; and this being unsettled, and her husband not a party to the bill, her claim to the purchase money from Olm stead cannot be litigated in this suit, and the bill must be dismissed as to all the parties.

The decree of the Court below dismissing the respective bills as to all the parties must therefore be affirmed, with costs, but without prejudice.

Cooley and Campbell JJ. concurred. Martin Oh. J. did not sit in this case.