The herald., 1898-01-23
Into Which the Southern
California Was Drawn
REPENTANT Y0UNGSTER
EX-POLICE OFFICER BATES IS
AGAIN ON THE RACK
A Damage Suit Filed Against The
Herald-Divorces Below the
Average-Woodruff Case

There are wheels within wheels" in
the carrying out of most contracts, but
in the suit of H. L. Williams ct al. VS..
Producers Oil company ct al. 1t is inter-
esting to note how the Couthern Cali
fornia railroad was made party to con-
tract to purchase oil as fuel on its road.
The testimony in the case showed that
in January, 1895, Williams, desiring to
embark in business and being acquaint-
ed with \. p. Maginnis, who was then
an officer of the Southern California
Railway company, entered into con-
tract with him, by the terms of which he
agreed that if Maginnis would use his
influence with the railroad company IN
securing to Williams a contract to fur
nish all the oil consumed for fuel by the
company for the period of two years, he
would pay Maginnis a commission of 10
cents per barrel for all oil sold to the
company during the continuance of the
contract Maginnis, sure enough,
rustled around and did induce the COM
lpany with which he was connected to
contract with Williams to buy all fuel
oil from him for a period of two years,
ending July, 1897, at the rate of 81 per
barrel of II gallons each, and by which
contract Williams bound himself to fur-
nish certain tanks for storage, give
bond for faithful performance of con-
tract and on this basis the contract
went into effect.
But Williams had no oil himself, and
so he hied him to the Producers Oil
company, of which Maginnis was di-
rector and officer, and contracted with
that organization for oil enough to fill
the contract with the railroad company,
at 10 cents per barrel of AZ gallons each,
for oil over 16 degrees gravity and 65
cents per barrel of AZ gallons for oil
under that degree of gravity. In order
to fill this contract, the Producers COM
pany had to raise some money, and $780,
900 was obtained from the Farmers and
Merchants bank upon note indorsed
by Williams. Parker and Maginnis and
secured by mortgage.
The Producers company sold to Will
liams 1898 barrels of oil above Is degrees
gravity and a large amount of oil below
such gravity, including 3S7 barrels of
Bedrock" oil, all of which Williams had
mixed and delivered to the railroad COM
pdHN ana pulleu uoNH IL tlle COHlIdtl prize
of 81 per barrel.
The note was paid, with the exception
of $4,000, and the Producers company de-
faulted in this amount, and the indors-
ers stipulated with the bank that they
would pay. Parker. of his own means,
paid $1,000, and Williams paid, for him
self, $4,000, and for Maginns s2OOO which
last amount was due Maginnis for his
royalty on the oil sold to the railroad
company. When the full amount of the
note was paid Williams caused the bank
to execute a transfer to himself and
Parker of the note and of the mortgage
security, and they jointly brought ac-
tion to foreclose the mortgage. Magin-
mis- intervened, alleging that he had paid
his third on the note and that Williams
and Parker held assignment of one
third of the note and mortgage in trust
for him. But Williams denied Magin-
MIS- claim, on the ground that the con-
tract by which he was to receive COM
mission for the oil sold to the railroad
company was against public policy and
void, and that, growing out of this and
other collateral contracts, all of which
are shown to be as irregular as the rail-
road contract, an Indebtedness exists
from Maginnis to Williams in excess of
the $4,000 paid on the note in behalf of
Magnnis.
Judge Allen, in his opinion, pronounces
the contracts as fraudulent in their in
ception, but that the profits of the lille
gal transaction We're divided between
the guilty parties, and that Williams
paid to the bank for Maginnis $4,000 as
and for his share of the profits. To this
extent the contract, although illegal, was
executed. and this position will not be
disturbed. Williams having voluntarily
paid Maginnis, or the bank for him,
$4,000, the court finds that Magnnis sub
rogated to a one-third interest in the
note and mortgage; and, while it would
not grant relief to Maginnis under the
original contract, it refuses also to grant
relief to Williams, which tends to re-
fund to him any portion of the profits
of the transaction paid out by him. The
Judgment therefore, is, so far, for Ma
ginnis.