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opposite the name of Fransham, on the Sil- 3. The contingent liability of a land company ver Republican ticket, they expressed their claiming under a Sioux half-breed scrip entry, intent to vote for Fransham. Such a mark
canceled after it had conveyed the land, on its
covenant of warranty in the deed,. was not, ing of the ballot renders it impossible, in our prior to such cancellation, an "existing debt, judgment, to determine whether the voters within Comp. St. 1887, div. 5, $ 460, making the legally intended to vote for relator or for' trustees of a corporation engaged in buying and
selling town lots liable for its debts, if it failed the defendant, for the mark in the circle at
to publish an annual report showing its existthe top of the Democratic column, although ing debts. apparently in favor of relator, was neutral- 4. Comp. St. 1887, div. 5, § 463, making the ized by the marks in the Silver Republican
officers of corporations engaged in buying and
selling town lots, who sign a false annual recolumn opposite defendant's name. The
port as to its capital and debts, liable for all its voter who so marked his ballot has really debts contracted while they were in office, apvoted for two opposing candidates for the
plies only to debts contracted after the false
report was made. same office, and for sheriff his ballot cannot be counted at all. If there had been no
Appeal from district court, Lewis and candidate in the Democratic column named Clarke county; Henry N. Blake, Judge. for sheriff, and the cross was opposite the
Action by Silas M. Giddings against A. M. name of Fransham in the Silver Republican
Holter and others and the Castle Land Comcolumn, the facts would bring the case pany. From a judgment for plaintiff as squarely within the Dickerman-Gelsthorpe against all the defendants, the company and decision; but the difference is most signifi
the other defendants bring separate appeals. cant, and it is impossible to say just what
Affirmed as to the company, and reversed as the voter meant by marking his ballot as he
to the other defendants. did. As we have said, the circle mark be- Action on covenants of warranty, and ing of equal significance with the cross mark against the trustees of a corporation for failopposite the name, the corollary of that, and ure to file annual reports and for a false rethe equivalent statement that the voter has port. The agreed statement of facts upon distinctly expressed his intent to vote for which this case was tried is substantially as two men, is that, so far as that part of the follows: On August 5, 1890, one Quinn enballot is involved, it becomes impossible to tered 80 acres of government land, lying addetermine the elector's choice, and such a jacent to the town of Castle, in Meagher vote or votes must not be counted for either county, Mont., with Sioux half-breed scrip, candidate. The sequel of what we have and the next day conveyed the same to one said is that the district court extended the Bullard. On December 16, 1890, the Castle rule of liberality of construction of section Land Company was incorporated and organ1403 beyond a point where we think it can ized. Bullard, having had the land platted be properly applied. The court should have as the King addition to the town of Castle, overruled the demurrer upon this branch of conveyed it on June 23, 1891, to said compathe case, and required defendant to answer ny. On May 1, 1891, the Castle Land Com. the averments concerning the votes in the pany conveyed a vacant lot in said addition precincts of South Bozeman and Chestnut. to one Giddings for $1,500, and on July 3, The judgment is therefore reversed, and the 1891, another vacant lot therein for $800. case remanded, with directions to the dis- The deeds of conveyance contained the foltrict court to overrule the demurrer, and re- lowing covenant: "And the said party of quire defendant to answer the averments the first part and its successors do hereby pertaining to the South Bozeman and Chest- covenant that it will forever warrant and nut voting precincts. Reversed and remand- defend its right, title, and interest in and ed.
to the said premises, and the quiet and
peaceable possession thereof, unto the said BUCK, J., concurs.
party of the second part, his heirs and assigns, against the acts and deeds of the said
party of the first part, and all and every per(19 Mont. 263)
son or persons whomsoever lawfully claimGIDDINGS v. HOLTER et al. (No. 842.) ing or to claim the same.” Subsequently SAME v. CASTLE LAND CO. (No. 843.) Quinn's entry was contested in the United (Supreme Court of Montana. March 8, 1897.)
States land office, and on April 5, 1894, it
was canceled by the secretary of the interior. COVENANT OF WARRANTY DEED FROM LAND COMPANY-LIABILITY-HALF BREED SCRIP ENTRY
On January 22, 1895, one Wilson, in behalf - CANCELLATION - CORPORATIONS-ANNUAL RE- of the Castle Land Company, entered the
“EXISTING DEBTS" - FALSE REPORT King addition with soldiers' additional homeLIABILITY OF TRUSTEES.
stead scrip. The Wilson entry was also con1. The United States is a person, within a tested, and while the present action was covenant, in a deed from one whose title rested on a defective Sioux half-breed scrip entry,
pending it was canceled by order of the secto warrant title against all persons lawfully retary of the interior. The fact of the canclaiming the land.
cellation of the Wilson entry does not ap2. The contingent liability of a grantor holding under a defective Sioux half-breed scrip
pear in the record, but the lower court took entry, on his warrant of title, becomes fixed judicial notice of it. Holter, Parchen, Seligwhen the entry is canceled,
man, and King are now and were the direct
ors or trustees of the Castle Land Company his deeds. The trustees of the company were from the time of its organization. In the made defendants in the suit, and judgment years 1891, 1892, and 1893, no report was was demanded against them by reason of filed by the company as required by section their failure to file reports in 1891, 1892, and 460, p. 728, div. 5, Comp. St. 1887. Said sec- 1893, and the report tiled in 1891, alleged to tion is as follows: "Every such company have been false. Judgment was rendered shall, annually, within twenty days from the in the district court in accordance with the first day of September, make report, which prayer of plaintiff. The appeal is from the shall be published in some newspaper pub- judgment. lished in the town, city or village, or if there
Cullen & Toole, Sanders & Sanders, and M. be no newspaper published in said town, city
Bullard, for appellants. F. E. Stranahan, for or village, then in some newspaper published
respondent. nearest the place where the business of said company is carried on, which shall state the amount of capital and of the proportion ac- BUCK, J. (after stating the facts). The tually paid in and the amount of existing first question for decision is whether the covedebts, which report shall be signed by the nant in plaintiff's deeds embraces the United president and a majority of the trustees, and States. The covenant is against "all and evshall be verified by the oath of the president ery person or persons whomsoever, lawfully or secretary of said company, and filed in claiming, or to claim the same." We are of the office of the clerk of the county where the opinion that the United States is a person, the business of the company shall be carried within the scope of its language. Republic on, and if any of said company shall fail to of Honduras v. Soto, 112 N. Y. 310, 19 N. E. do so, all the trustees of the company shallS45; Stanley v. Schwalby, 147 U. S. 517, 13 be jointly and severally liable for all debts Sup. Ct. 418; Peters v. Grubb, 21 Pa. St. 455. of the company then existing, and for all We are also of the opinion that when the that shall be contracted before such report Quinn entry was canceled the contingent obshall be made. No liability shall attach to ligation of the Castle Land Company on its any trustee, or board of trustees, by virtue covenant became fixed. Manifestly, the comof the provisions of this section, for a failure pany had abandoned any right to the King to cause to be published in a newspaper the addition under said entry when this suit was report in this section mentioned, if within instituted. See Resser v. Carney (Minn.) 54 the time herein mentioned said trustee, or N. W. 89. The judgment, then, as to the board of trustees, or company, shall annual-Castle Land Company, is affirmed. ly cause said report to be filed in the office We shall now discuss the liability of the of the county clerk and recorder of the coun- defendant trustees. The main question is ty in which the business of the said company whether or not the liability by virtue of the is carried on, as declared in its certificate of covenant alone is a debt, within the contemincorporation.” On September 4, 1891, the plation of section 460, div. 5, Comp. St. The Castle Land Company, by its trustees afore- section requires a corporation to report annusaid, filed a report' as to the affairs of the ally its “existing debts.” The liability incurcompany, which stated that all the capital red by the Castle Land Company when it exstock, in the sum of $500,000, was fully and ecuted the deeds to plaintiff, as respondent actually paid in. "At the time said last- himself contends, was not capable of enforcenamed report was made, the only property, ment in the courts until the Quinn entry was money, or credit, or other thing whatsoever, canceled, on April 5, 1894. Appellants' counwhich had been paid in towards the pay- sel urge that any right of action against the ment of the said capital stock of the said defendant trustees because of failures of the company, was the interest which the com- corporation to file reports in the years 1891, pany had in and to the King addition to the 1892, and 1893 is barred by the statute of limtown of Castle, derived through said Quinn itations. Answering this contention, counsel entry, which had been canceled as afore- for respondent says in his brief: "The diffisaid." Section 463, p. 729, div. 5, Comp. St. culty with their argument is that their prem1887, is as follows: "If any certificate or re- ises are wrong, for, while it is true that the port made or public notice given by the offi- fee had not passed out of the United States, cers of any such company in pursuance of yet the federal government had permitted the the provisions of this chapter, shall be false entry, and the receipt of the register and rein any material representation, all the offi- ceiver had issued, and was the property of cers who shall have signed the same shall the Castle Land Company up to the time of be jointly and severally liable for all the its cancellation by the department of the indebts of the company contracted while they terior. on April 5, 18M. During that period of are stockholders or officers thereof." Gid- the life of the certificate, the courts W't closed dings never took any actual possession of the to the plaintiff by section 542 of the first divilots. In December, 1894, he brought suit sion of the Compiled Statutes of the State of against the Castle Land Company, on the Montana, which is as follows: "The receipt or corenants in his deeds, to recover the pur- certificate signed by the register or receiver of chase price he had paid for the two lots, any U. S. land office of the entry or purchase with interest from the respective dates of of any tract of land, or of any tract by any land warrant, is prima facie evidence in the boundary between an unliquidated liability courts of this state that the title to the land resulting from a breach of contract and one mentioned or described in said receipt or cer- flowing from a tort. In Foundery v. Hovey, tificate, is in the person named therein, his 21 Pick. 455, involving a claim for unliquiheirs or assigns.'
And what would dated damages for breach of a contract, have been the plaintiff's standing here had Chief Justice Shaw uses the following lanhe himself attacked and broken down his guage: "For though a question was made, own title which he held through the receipt, whether such a claim for unliquidated damand which the defendant company had war- ages is a debt, within the meaning of the ranted to defend in him?" The argument of statute, we do not think it admits of a reacounsel for appellants on this question of sonable doubt that all such claims for damlimitations is a somewhat inconsistent one. ages were intended to be included in the They insist that the covenant liability at the term 'debts.'' In Carver . Manufacturing time of the execution of the deeds was not an Co., 2 Story, 432, Fed. Cas. No. 2,485, Mr. existing debt, within the meaning of section Justice Story said: "I follow out the doc460, but, in point of fact, was so contingent trine of the case of Foundery v. Hovey, 21 in character that even the respondent could Pick. 435, which, as far as it goes, disclaims not have regarded himself as a creditor of the the interpretation of the word 'debt' as limcompany at that time, Yet when they in- ited to contracts for the payment of detervoke the statute of limitations they assume minate sums of money. Passing that line, their liability on the theory that any breach it does not seem to me easy to say that if of a covenant of warranty occurs at the mo- cases of unliquidated damages may be treatment the covenant is executed) was one in ed as debts, because they end 'in the asceractual existence when the failures to report tainment of a fixed sum of money, the docin 1891-92-93 occurred. In the view we take trine is not equally applicable to all cases of of this case, it becomes unnecessary to decide unliquidated damages, whether arising ex any question as to the statute of limitations, contractu or ex delicto." The supreme court but we refer to the argument on the subject
of Iowa in Warner v. Cammack, 37 Iowa, because it practically sheds light on the point 642, held that the liability resulting from a of whether the covenant, at the time of its fraud perpetrated was a debt, in the sense execution, 'was an existing debt within the of the term "debts contractel,” contained in contemplation of section 460. When the the homestead statute of that state. The deeds were executed, for all that appears in court said: "We hold that it was a debt. the record, neither the grantee nor the gran- And this because the plaintiff in that action tor knew of, or had any reason to know of, might have waived the tort, and brought his any defect in the title to the lots. As to action for money paid to the use of the dethe exact time when the Quinn entry was fendant therein." In Green v. Easton (Sup.) first assailed, the record is silent. Presum- 26 N. Y. Supp. 553, the court held that an ably, both parties to the covenant regarded unliquidated claim for a breach of contract the title through Quinn as good until canceled of employment was a debt, within the meanon April 5, 1891. The status of liability un- ing of the New York statute, which, as we der the covenant must be regarded, therefore, have stated, is almost identical with section by us, as the same at the time of each fail- 460. But in Manufacturing Co. v. Beecher, ure to report in the years 1891, 1892, and 26 Hun, 48, the court said in reference to the 1893.
statute: "The question, under the Section 460 does not require a corporation statute, is whether the allegations of the to report, as existing debts, unliquidated de- complaint show debts existing against the mands against it, founded on torts. Our corporation, within the meaning of the section 460 is substantially the same as that twelfth section (chapter 40, Laws 1848). of New York, from which state it was taken. They show, undoubtedly, causes of action for In a case involving a construction of the breaches of contract, and causes incidentally New York statute (Chase v. Curtis, 113 U. S. arising or resulting from such breaches, 452, 5 Sup. Ct. 551), the court said: “The which would entitle them to recover damstatute involved in this discussion is not a ages against the company unless met and remedial statute, to be broadly and liberally defeated by some sufficient defense; but it construed, but is a penal statute, with pro- is very doubtful whether such causes of acvisions of a highly rigorous nature, to be tion are debts, within the meaning of the construed most favorably for those sought act; and, if they were debts, would not the to be charged under it, and with strictness company be bound to include them in the against their alleged liability. Under such a annual report of existing debts to be made rule of construction, its language is limited under section 12? The statute says the reby its own terms to a liability on the part of port must state the amount of existing debts. the trustees to debts of the corporation ex- Is it the intention that the report shall state, isting and arising ex contractu.” It is true as 'existing debts, the amount of disputed that a liability for a debt based upon a cove- and contested claims? If this be so, then nant in a deed, even before the debt is liqui- the statute would operate in many cases as dated, is one ex contractu. But it is always a confession of indebtedness destructive of somewhat difficult to clearly define the good defense. The words 'existing debts' must have been used in some more restric- ital stock was paid in full, the mere fact tive sense, or else the statute might operate that the land representing it had become to subject the trustees to liability which valueless would not render its 'officers or may not be capable of recovery against the stockholders liable for any debts of the comcorporation itself; for, if they are to be re- pany. This action of plaintiff's is not one garded as existing debts, then their omission to make stockholders liable for unpaid stock. would be fatal to the validity of the report. The allegatiors of the complaint show that
The courts are bound to observe the the plaintiff seeks to recover from the trusdistinction of law between debts and de- tees solely on the ground that they made a mands or claims for damages.” The court false report. He relies upon section 463 of also said: “The courts have held that cer- the fifth division of the Compiled Statutes tain kinds of liability, which must ultimate- of Montana. Even, however, if the report ly ripen into debts, are not debts, within the is false, can plaintiff avail himself of any meaning of the act of 1818 and similar acts. false statement in it? The contract of the Oviatt v. Hughes, 41 Barb. 541; Arms Co. v. Castle Land Company under the covenant of Barlow, 68 N. Y. 31." The case of Green v. warranty had ripened into an actual debt Easton, supra, it seems to us, is apparently liability, and plaintiff's right to sue had acin conflict with Manufacturing Co. v. Beech- crued, before this report of 1894 was made. er, supra. But a distinction can be drawn Section 463 is strictly a penal statute, and between a claim which actually exists in the we agree with the interpretation placed upon form of a debt-even though an unliquidated it by the supreme court of New York in Torone-upon the breach of a contract, and a bett v. Godwin (Sup.) 17 N. Y. Supp. 46; liability not ripened even into the semblance the Montana section 463 being identical with of actual debt, but merely possible as a debt section 21 (chapter 611, Laws 1875) of the from the existence of an agreement or con- New York statute construed in said case. tract. The contract before us does not fall The debts for which officers of a corporation within the rule laid down in Green v. Eas- who make a false report are liable are not ton. In that case the facts evidently dis- those contracted by the corporation prior to closed a conceded breach of contract prior the making of a false report, but those conto the time of filing the corporate report. In tracted subsequent thereto. This is a reaour opinion, in no sense within the meaning sonable and fair construction of this section. of “existing debts," as that term is used in under the rule heretofore announced for the section 460, was this covenant in these deeds construction of penal statutes of this chara debt in 1891, 1892, and 1893. It constitut- acter. The judgment of the lower court as ed a contingent obligation only, not ripened to the defendant trustees was erroneous, and into a debt during the period of the contest must be reversed. The case is remanded, of the Quinn entry. To hold that this section with directious to the district court to render contemplates that the trustees of a corpora- judgment for the defendant trustees. tion should be held liable for failures to re- Two separate appeals were taken from the port mere possibilities of debt, even though lower court's decision,--one in behalf of defounded on contracts, would be a harsh doc- fendant trustees, and the other in behalf of trine. Such a doctrine would seriously im- the Castle Land Company,--and two transpede the business operations of corporations. cripts are in this court. The costs of appeal It would practically necessitate the inclusion in the one numbered 812 must be paid by in their annual reports of details of a char- the respondent, and in the one numbered 843 acter oftentimes trivial and wholly immate- must be taxed to the Castle Land Company. rial. It would fasten a responsibility of so burdensome a nature on a trustee of a cor- HUNT, J., concurs. poration that no man of ordinary prudence would agree to accept such a position. It would violate the rule laid down in Chase v. Curtis, that this section “is a penal statute, THOMAS et al. v. CHICAGO, K. & N. with provisions of a highly rigorous nature, to
RY. CO. be construed most favorably for those sought
(Supreme Court of Kansas. March 6, 1897.) to be charged under it, and with strictness
RECORD ON APPEAL. against their alleged liability." We are clearly of the opinion that the defendant trustees are
The evidence and proceedings in the record
of one case on appeal cannot be considered in not liable for the failure of the Castle Land a different case. Company to make reports in the years 1891, 1892, and 1893.
Error from district court, Shawnee county; The next question for our consideration is
John Guthrie, Judge. whether or not the report of the company
Action by Jonathan Thomas and others made in 1894 was a false report. From the
against the Chicago, Kansas & Nebraska record, we cannot say that it was false. It
Railway Company. Judgment for defend
Affirmed. in no wise appears, even 'inferentially, that
ant, and plaintiff's bring error. the King addition did not cost the Castle Curtis & Safford and H. C. Root, for plainLand Company the amount of money for tiffs in error. J. D. McFarland, for defendwhich it issued its capital stock. If the cap- ant in error.
PER CURIAM. The only questions pre- locomotive with Thomas Williams, an engl. sented for review in this case arise upon the neer. They brought a train into the yards testimony that was offered and received in at Raton about midnight, and, no brakeman the court below, and which has been pre- being present to uncouple the engine from served and brought into the record of these the train or pilot it into the roundhouse, Tinproceedings. The case appears to have been dall was directed by the engineer to uncouple tried in connection with another, and there the engine, which he did. Instead of getting is a stipulation that the testimony intro- | back into the cab, Tindall then took a posiduced should be used in both of the cases as tion on the front end of the engine, sitting far as applicable. The other case has been upon the pilot beam, with his feet resting brought into this court, and it is stated that upon the pilot. The first switch to be it includes the evidence, and we are referred thrown was between 300 and 400 yards from to that case for the evidence in this. It bas the starting point, and, upon a signal from already been decided that the evidence and him to the engineer, the engine was moved proceedings in the record of one case cannot forward at a rate of about 5 miles an hour. be considered in auother and different cause; There had been a storm, and snow was fallnor can anything be considered as part of a ing, and there was snow upon the pilot and case-made unless it is actually incorporated front end of the engine. Tindall had a lantherein. Parkhurst v. Bank, 55 Kan. 100, 39 tern upon his arm, and with one hand held Pac. 1027. Nothing is, therefore, left for our onto the pilot brace. While reaching to his consideration, and the judgment of the dis- hip pocket with the other hand to obtain his trict court will be affirmed.
gloves, there was a jar of the engine, which caused him to fall from the pilot. One of
the wheels of the engine passed over and (57 Kan. 719)
crushed his arm, so that amputation above ATCHISON, T. & S. F. R. CO. v. TINDALL, the elbow was necessary. He alleges that (Supreme Court of Kansas. March 6, 1897.)
the injury was caused by the negligent con
struction and maintenance of the track at RAILROADS - INJURY TO SERVANT - NEGLIGENCECONTRIBUTORY NEGLIGENCE.
the place where the injury occurred, and 1. In an action by an employé to recover dam
that the defect in the track was such that ages from a railroad company for personal in- with proper diligence and care on the part of juries alleged to have resulted from a defect in the company it could have been discovered the railroad track, negligence will not be presumed, but must be proved. Testimony that
and remedied in time to have prevented the there was a defect in the track, and that an
Injury. The company denied the charge of injury occurred, is not enough to warrant a negligence, and averred that the injury was recovery. It is necessary to prove that the
the result of his own carelessness. At the company knew of the defect, or that it was of such a nature or had existed for such a length trial, the jury found that the injury was due of time that, in the exercise of ordinary care, to the negligence of the railroad company, it should have been discovered by the company. and awarded $5,500 to Tindall as damages. Doster, C. J., dissenting as to the application to the facts of the case.
The sufficiency of the testimony to sustain 2. If such employé voluntarily and needless
the verdict is the first question to which our ly places himself in a highly dangerous posi- | attention is directed. On the part of the tion, when there is a reasonably safe one pro
company it is contended that the track was vided for him, and he has time to exercise his judgment, and choose a safer place, and injury
not defective or dangerous, and that, if there occurs to him by reason of his choice, he ordi- was a defect, the company did not know, narily cannot recover for such injury.
and could not by the exercise of ordinary , 3. The testimony examined, and held to be
care have known, of its existence. What insufficient to sustain the verdict and judgment. (Syllabus by the Court.)
the defect was is not shown, and what
caused the jar of the engine is a mystery not Error from district court, Douglas county;
solved by the testimony. Williams, the enA. W. Benson, Judge.
gireer, testified that, “at the time he fell, I Action by Thomas H. Tindall against the felt a jar of the engine, as if we struck a Atchison, Topeka & Santa Fé Railroad Com
rough place in the track. Of course, I pany. From a judgment for plaintiff, de
couldn't tell just what it was, but it felt like fendant brings error. Reversed.
a low joint.” Again, he stated that “I felt A, A. Hurd, W. Littlefield, and 0. J. Wood, a jar of the engine as if there was a rough for plaintiff in error. Waters & Waters, for track. At the time, of course, I couldn't say defendant in error.
exactly what kind of a track it was, but the
track was rough there at that time; at least, JOHNSTON, J. This was an action by it felt that way." After stating that some Thomas H. Tindall against the Atchison, To- jars were usually felt upon the engine, he peka & Santa Fé Railroad Company to re- testified that the one that occurred when Tincover for personal injuries alleged to have dall fell off the engine was “above the orbeen suffered by him through the negligence dinary." In answer to an inquiry as to how of the railroad company. Tindall was a lo- he came to fall from the pilot of the engine, comotive fireman engaged in the service of | Tindall testified as follows: "It felt like she the company in New Mexico, and on the came against something, and struck pretty night of November 2, 1889, he was upon a baru, and I was thrown oil. Q. Wbat was