WANNEKER
11.
H.xTCHCOCK.
(Otrc'Uit OO'U4't.N. D. Illinois. April 8, 1889.) A. testator devised certain shares of stock to his t",olilxecutors, H.and W.· in trust- to be 'sold and the proceeds' h.eld for the beJ,iefit of his wife andchildren.W. was not allowed:to qualify as executor because he was a non-resident. and H. qualified as Bole executor, and applied to. the probate court and obtained an order to' sell the stocjI:; on the ground that it was in danger of becoming nepreciated. W. filed this bill, alleging that H had excluded him :from·participating in the trust; that the annual meeting of the corporation is soon to be held; and that by reason of dissensions between complainant !Llld defendant as. to said stock its vote cannot be cast so as to properly manage the affairs of the corporation; and praying for a receiver to take possession of the stocli:. vote .uponit at the coming ann ual meeting. and sell it under the direction of ,thill c.onrt after due construction of the will. Held. that the relief The probate conrtcanfullyprotect the interests of would not be all parties concerned. TRUSTEES.
In Equity. Bill for appointment of receiver. E. F. Gorton, W. S. Young,Rnd R. H. OurtiB,for complainant. D. J. &: H. D.Orocker and James L. High, for defendant. John· Woodbridge and S. EaBtman, for intervening petitioners.
a.
BLODGETT,J. This is an application for the appointment ora receiver to take possession of, vote upon, and sdl16 shares of the capital stock ofthe Blanke & Bros. Caady Company, a corporation formed and existing under the laws of the state of Missouri, and doing business in the city of St. Louis. The allegations of the bill material to the question now before the court are that one F. W. Blanke, now deceased, who was a resident ofthe city of Chicago during his life-time, was the owner of said 16 shares of.stock; that he died testate in this city on the 3d of April, 1888, and by his will devised the said Stock to the complainant, Wannekerjand the defendant, Hitchcock, as trustees, to be sold bythem, and the proceeds held for the ·use of his wife and children, with the direction that the said stock be sold to the testator's nephew, Henry W. Blanke, in case his bid should be equal to the highest bid of any stockholder of the corporation, and exceed the highest bid of any other persam. The complainant and the said HitchcOck were, by the terms of the will, appointed executors, but on probating the will in the probate court of Cook county that court refused to appoint the complainant one of the executors, on the ground that he was nota resident of the state of Dlinois, and the defendant, Hit<lhcock, was appointed sale executor upon his individual bond. The bill further charges that Hitchcock, as eiecutor,hasfuken possession of the stock, and now holds the same; that the stock is worth, inclUding the dividend declared on the 1st day of March last, the sumof 855,000; that Hitchcock refused to allow the complainantto participate i in. the management ofthe affairs of the said estate,or in.anymanagement oftha stock, although it was specifically devised to the oomplainant and Hitchcock as co-trustees; and that Hitch-
FEDERAL
.vol·. 38.
cock has given only his individual bond as executor; and that he is not· financially responsible for the proceeds oithe sto,ck if they come into his hands; that the annual meeting of the company is soon to be held, and that by reason of the disagreements and dissensions between the complamant and defendant as to tbe said stock a vote cannot be cast so as to secure proper management of the affairs of the corporation;' tbat Hitcbcock bas proceeded to sell the stock, and obtained a bid from one Samuel Powell of $54,000 for the stock, and threatens to turn over the certificate to him as said purchaser; that the bid is not for tbe value of the stock. The bill prays for a receiver to be appointed to take possession of the stock, and to vote upon it at thl:l coming annual meeting, and to sell the same under the direction of this court after due construction of the will. There is also a prayer for an injunction restraining Hitchcock from selling to Powell, and Powell from purchasing, but this motion is not pressed at present. It appears from the answer and the affidavits that Hitchcock applied to the probate court for leave to sell the stock under section 90 of the administrator's act of the state of Illinois, on the ground that by reason of dissensions among the directors and managers of the company there is danger that the v.alue of. the stock may be depreCIated, and that upon this pe.tition the court ordered the executor Hitchcock to sell the stock; tbat he solicited bids., and that Powell bid $54,000, which was the higbest bid made for the stock; that Hitchcock reported the bid to the probate court, and asked· for a confirmation of the same, and that the stock be turned over to him, but it does not appear that the sale has been confirmed. Secti6n 90, c. 3, Rev. St. Ill., in regard to the administration ofestates, seems to me to clothe the probate court with some discretion as to the sale·of personal property when necessary for the preservation of the estate. At all events, there can be no doubt but that that court has acted upon this petition, and ordered the stock to be sold. While the will devised the stock in question to the complainant and Hitchcock as trustees, it seems to me that this trust must remain in abe)'ance until the administration of the estate is closed, and it is determined that the stock is not required for the payment of debts, and during this time the probate court may direct a sale of the personal property upon proper case made, even although such personal property may be a specific bequest; that is while the personal property is under control of the probate court, that court may, upon being satisfied that the interests of the estate demand it, direct the sale. The manifest purpose of the testator in this will was that this stock should be sold, and sold at once, for the purpose of converting it moo money, that might be invested or otherwise secured for the benefit of the testator's wife and children. It makes no differ" ence, so far as the estate is concerned, it seems to me, whether the sale is made by the sole acting executor or by the two trustees acting together; the main point being to make sure that it bring its full value,and the probate court of Cook county is equally capable with this court of determining .that question of fact. If the sale is made the proceeds will be turned over tothe trustees under the will indue cours.e.of ad,
WANNEKIilR V.' HITCHCOCK.
385
nlinistration, and not until then. They wilhemaifi in the hands of the probate court until the estate is closed, if. the. sale :is made; aodat the close of administrative ;proceedings the probate court will undoubtedly direct the money to he turned over to the trustees in accordance with the provisions of the will. I do not see how the fact that there are rlifferences of opinion or judg·, ment between the complainant and the defendant, Hitchcock, as .to the proper policy to be pursued by this company, and the proper persons to, be voted for as directors of the company at the coming annual meeting, makes a case for the appointment of a receiver. This testator appointed two trustees, and I do not think it makes a ,case for the interposition of the court that the two trustees cannot agree as to any matter of ment or discretion with which they are clothed. There might be, per-· haps, a case made where the imperative necessity for the votes being cast for this stock at this coming annual meeting would so impress itself upon the court that the court, in the exercise of its discretion, might appoint a third person to exercise the power with which tbe trustees are clothed. I do not say but that under certain circumstances snch a power might not be exercised. I simply say that no case is made here by this bill which justifies the court in interposing its power and taking this st04k away from the person or persons authorized to vote on it. Then, too, this further consideration impressed itself upon my mind: that, while the executor is in possession of this stock and under the control of the probate court for the administration of the estate he is pro hac vice the only representative of the stock, and as such it would seem to me that the corporation at its annual would recognize the acting executor, no matter by what court appointed, as the representative of the stock at that meeting. From the showing now made by this bill I am strongly inclined to the conclusion that the probate court acted wisely in directing a sale of this stock at the present time by the executor. Aii the bill shows, there are two administrations now going on upon this estate,-one in St. Louis, taken out by the present complainant as one of the executors appointed under the will; the other, the domiciliary administration, taken out by the defendant, Hitchcock, in Cook county, which was the home of the testator. Th1m, the present complainant has c.Jmmenced suit in one of the courts of St. Louis county for the purpose of enjoining any transfer of this stock; and H. W. Blanke, the nephew, wbo is recognized under the will as having some prior right to purchase,. or preferential right to purchase, at tbe highef't amount bid, has also commenced a suit in the superior court of Cook county, and obtained an injunction against the acting executor here, upon the ground that he, H. W. Blanke, has an interest in this stock by virtue of some contract which he alleges was made between himself and the testator for the sale of the stock before the testator's death. The interposition of tbis court, therefore, would complicate what is already sufficiently complicated, it seems to me, in this estate, to an unnecessary and unwarranted extent; and, inasmuch as the granting ofinjunction and the appointment of receivers is largely a matter ()f judil;:ialdiscretion, I do fiot v.i38F.no.5-25
886'
FEDER!AL 'REPORTER.
vol.' 88'.
thinktnatit wbuld be tothell.dvantage of this estate that another tri· butialstiH! 'should appoint a reoeiver, or do any act that would add to the C6n1plications in which the ,estate is already involved. . Thecomplll.int in the bill that the purchase by Powell is at an inadequate price, seems to me to be hardly supported. The statement made is that the executor solicited bids from all the stockholders of the company,who are the preferred purchasers, if they will give as much as others, and also solicited bids from outsiders, and that Powell's bid was the highest bid made, and that is within $1,000 of the amount set forth in the bill itself to be the value of the stock, including the dividend which has lieendeclared. There is only $1,000 of difference, and it seems to me'that is hardly an amount to quarrel about; and, even if that were so, the parties have their remedy in the county court. I do not understand that the probate judge of Cook county has confirmed that sale to Powell.. It has been reported to him, and his confirmation asked. If any other person shall think that it is worth more than Powell bid, and should come in and bid: a larger amount, I have no doubt that the probate judge, in the exercise of that and sound discretion characteristic of him, will consider the bid; in other words, that he will not let Powell purchase at that price if he can find anyone else who is willing to pay more. If the proceeds of this stock at. its full value come into the control of the probate court, that court, I doubt not, will require the acting executor to give an ample bond to secure its safety. I will add that it seems to me there is an ample remedy given by the statutes of' lllinois for any errorsthat may be committed by the probate court by an appeal from ita orders or Judgments. The motion for the appointment of a receiver is overruled. -
SPRAGUE 'D. RoSENBAUM
et al. '
(Oircuit OOU'I't,N. iJ.lllinoi8. January 28, 1889.)
CatUe were consigned by C. to the defendants as "tock·brokers at certain ,', stock-yards. -The plaintiff entered into negotiations with the agent of the defendants for the purchase of such cattle. informing him that he was ac· guainted.with him a,nd preferred to make the purchase from the defendants. , ,The' agent replied that it would make no difference whether the terms of sale 'were 'agreed upon with the defendants or with and referred him to the latter. .'l'heltermsof sale were agreed upon with C. Weight tickets were given to"thll.\llaintiff in the firm,namll of the defendants. and also a bill of sale, . thOugh 'not sIgned at the bottom., reciting that the cattle had been sold to the plaintiff lJt'tbedefendantB for a named consideration. It appeared that C. was a stranger to the plaintiff, and that he had been informed that the defendants were ingood credit. Beld, that the defendants sold the cattle a8, their OWJ:l, wt:re liable to plaintiff on an implied warranty of title. '
AND BnOlCEBS-LIABII,ITY."
At Law.
Gov. Hannuwn,for ,plaintiff. MayeraciSt6in, fdr defendants.
"
.: .iPRAGpE f1. ROSENBAUM:.· I GRES;HAltf, J.. The defendants ;arecom:l:nission merchants or stbck': 'i>rokers, dqi,ngbusinessat the stock-yards at Chicago and Omaha·. J.Clark shipped from his' home in consigned to the defendants at Omaha 172 steers for sale. The plaintiff, a stock'; feeder .and dealer in the same state, employed Savage & Green; who. were also stock-'Qrokers in the Omaha yards, to assist him in the selection and purchase ofstel:lrs at that place. The plaintiff was informed' op the morning of October 8, 1886, by an agent or employe of the defendants, that they held this lot of steers for sale, and upon going to the pensio examine t4em the plaintiff for the first time met Clark, who was anxious to sell the steers, but he and the plaintiff were unable to agree upon a price. In the afternoon of the same day the plaintiff met W. A. Sharp, the agent and general superintendent of the defendants, who was about to leave t4e firm's office and go home, not to return until the next day, and the plaintiff testified that he then told Sharp he would like to buy the steers, but desired to get home before Sunday. and that Sha'rpdi... repted him to return to the pens, where he would find a man who could sell the steers; that he told Sharp he was acquainted with hini, and pre-ferred making the purchase from the firm; that Sharp replied it would make no difference whether plaintiff agreed upon the terms of sale with the defendant, or the person to whom he was referred. Theevidence clearly shows that. this person was Clark, and that the plaintiff then knew Clark was the consignor. Sharp testified that before leaving for his home, as already stated, the plaintiff expressed a desire to buy the steers,and said he should endeavor to do so before Sharp returned the next ing. A short time after this conversation, the plaintiff and Clark agreed upon a price, went to the office of the defendants, and informed their general agent, in the absence of Shurp, of that fact. The agent caused the steers to be weighed, and gave the plaintiff weight tickets in the firm name of the defendants, also a brief instrument in the form of a bill of sale, butllot signed at the bottom, stating that the defendants, had sold to the plaintifi'172 steers, weighing 138,790 Ibs., at $2.70 per hundred, amounting to $3,747.33. The plaintiff, through Savage & Green, paid for the steers, they were delivered to him the next morning, he shipped them to his farm, and the defendants promptly paid Clark the purchase money, less their charges and commissions for making the sale. In reply to inquiries by the plaintiff', Savage & Green informed him that the defendants were in good standing and reliable. About a week after the sale, Harrington Emerson sued the plaintiff in replevin for possession of the steers, claiming them under a chattel mortgage which Clark ecuted before the consignment to the defendants. The plaintiff promptly notified -the defendants of the commencement of this suit, and requested them to defend it, which they did not do, and after the plaintiff waS defeated, and had lost the steers, he brought this action to recover the amount he had paid for them. The general rule is that an agent who sells property as such for his known. principal is n9t personally liable on the contract, the presumption being that the purchaser gives credit to the principal, and not tothli I
888
FEDERAL REPORTER,
vol.3S.
agent. This rule is reasonable, but it has no application when, {rom the contract, the usages or character of the business in which the agent is engaged, or in any other way, it appears that the purchaser intended to give credit to the agent. It is doing no injustice to the agent to hold him personally liable on his contract when it is shown that the purchaser dealt with the agent on the faith of his personal credit and solvency. Clark was a stranger to the plaintiff, and, after being informed that the defendants were responsible and in good credit, the plaintiff told their superintendent he was acquainted with him, and preferred making the purchase from the defendants. This is what a prudent man would be expected to do under the circumstances, and the plaintiff's intention to make the purchase from the defendants on their personal responsibility is thus clearly shown. The instrument which the defendants gave the plaintiff, although not subscribed by them, was the written contract of sale; not subject to change or modification by parol testimony. Their firm name appeared in it, not as agents of Clark, but as owners and sellers of the steers, and when they received the purchase money from the plaintiff and delivered the steers to him, the written contract became an executed one. If the sale had been on time, instead of for cash, and the purchase money had not been paid when it became due. the defendants could have maintained an action in their own names against the plaintiff; and, the plaintiff having lost the steers, it follows that the defendants are personally liable to him on their implied warranty of the title. Cattle are consigned to brokers at stock-yards from different states and territories, with full authority to sell them as their own, and that was the character of the consignment from Clark to the defendants. The testimony shows that ,the defendants did sell the steers to the plaintiff as their own. If the contention of the counsel for the defendants is correct, purchasers of cattle who happen to know the name of the consignor have no remedy against the brokers for their violated agreements. JUdgment for the plaintiff for the amount he paid for the steers, with interest from the day of sale.
SMITH 'D. CITY OF CHICAGO.
(Circuit Oourt, N. D. lllinoi,. February 24,1889.) MUNICIPAL CoRPORATIONS-DuTY TO KEEP SIDEWALKS FREE FROM SNOW.
ICJll
A.ND
If snow falls upon the sidewalks of 8 city 80 as to become an obs.truction, It Is the duty of the city to remove it, but a reasonable time must be allowed , for the performance of this duty. If it unnecessarily permits such obstructions as ice and snow to accumulate to an extent that renders the sidewalks dangerous or unsafe, and persons, not themselves guilty of negligence, fall by reason thereof and are injured, the city is liable, but not otherWise.
. At Law. ries.
Action by Annie B. Smith for damages for personal inju-