Court Opinion

ID: 6426698
Source: CourtListenerOpinion
Date Created: 2022-06-25 12:04:31.17579+00
Date Added: 2024-06-11T15:52:01.128638
License: Public Domain

Field, C. J.
After the decision reported, 168 Mass. 304, the petition to prove the exceptions was referred to a commissioner with the usual powers, and his report is before us. The argument has been confined to the questions whether the bill of exceptions, as originally filed by the defendant, is in proper form, and whether the truth of the exceptions therein alleged has been established. We see nothing in the form of the bill of exceptions as filed which can be held to justify the disallowance of the exceptions. One of the defendant’s requests for rulings was “ that upon all the evidence the plaintiff cannot recover.” This rendered it necessary that the substance of all the evidence relating to the plaintiff’s cause of action should be set out in the exceptions. The bill of exceptions as filed contains little that can be regarded as immaterial, and some complaint has been made by the counsel of the plaintiff that on some points sufficient evidence has not been recited. It may be that some of the evidence which has been set out in the exceptions by question and answer could have been reduced to the narrative form; but plainly there has been an attempt to abridge the evidence, and we cannot say that this has not been done, so far as *296was reasonably safe for the excepting party. The present case is easily distinguished from Ryder v. Jenkins, 163 Mass. 536.
In Sawyer v. Yale Iron Works, 116 Mass. 424, 433, it is said in the opinion : “ If the bill, as tendered to the presiding judge, contains several distinct and independent exceptions, clearly and separately stated, the truth of one or more of them may be established, although the others are not proved as alleged, or are waived by the excepting party.” See Morse v. Woodworth, 155 Mass. 233.
It appears from the report of the commissioner that ten of the exceptions alleged, which are numbered in the report as follows, viz. 1, 2, 3, 4, 5, 6, 8, 9,12, 14, “ were duly taken, and that the ruling excepted to and the evidence to which they related are stated with accuracy.” The evidence reported at the request of the plaintiff concerning the second exception seems to us immaterial, and does not tend to modify the exception as taken. These are distinct and independent exceptions, and the truth of them has, we think, been established. The exceptions alleged, which are numbered in the report 10 and 11, are not established, and are waived. As to the exception numbered 13 in the report, we think that the difference between the exception as alleged and the exception as proved is verbal and unimportant, and the truth of this exception is establishéd. Markey v. Mutual Benefit Ins. Co. 118 Mass. 178,
As to the exceptions numbered 15 and 16 in the report, it appears that the petitioner is willing to accept the facts as found by the commissioner, and we think that he should be permitted to do so. Whether on these facts the same questions in the same aspects are presented in the exceptions reported as in the exceptions filed may perhaps be disputed. We do not at present see any substantial difference between the two statements, but the bill may be amended in these respects according to the report of the commissioner. See Lemery v. Boston & Maine Railroad, 167 Mass. 254, 256; Morse v. Woodworth, 155 Mass. 233. There remains only the exception numbered 7 in the commissioner’s report. We think that the same disposition of this should be made as of the fifteenth and sixteenth exceptions.
The exceptions as alleged in the bill as filed, except those numbered 10 and 11 in the report of the commissioners, will *297stand for argument with the findings of the commissioner on the seventh, fifteenth, and sixteenth exceptions. So ordered.
Afterwards the exceptions, as thus established, were argued on the merits. The facts appear sufficiently in the opinion.
C. A. Snow, for the defendant.
S. H. Tyng, for the plaintiff.
Holmes, J.
This is an action brought by the original holder of two promissory notes against a party who indorsed them before delivery. There was no consideration other than that moving to the maker, and the principal defences are that it turned out that the maker received none, or that if it did receive one the consideration was illegal.
The plaintiff was a construction company, and was employed to build four miles of street railway for the Interstate Street Railway Company, running to the lines of the Old Colony Railroad, which it was necessary for the Interstate Company to cross in order to use the four miles of track when laid. Three miles and a quarter at least had been laid and finished, except overhead work, and the materials necessary to complete the work were lying upon the ground, when, for some reason, perhaps because it could not get leave from the railroad commissioners to cross the Old Colony tracks, as required by St. 1891, c. 399, § 2, the Interstate Company wished to withdraw from its bargain. Thereupon, by substantially simultaneous votes, the Interstate Company notified the plaintiff that it declined to accept the construction; the plaintiff accepted the refusal and voted to sell to another company, the Attleborough, North Attleborough, and Wrentham Street Railway Company, “ all the material and other property now lying and being on the line of the street railway” in question, “for the sum of ($27,214.12) twenty-seven thousand two hundred fourteen and dollars, to be paid for by the indorsed notes of said corporation,” and the Attleborough Company voted to buy of the plaintiff “all the material and other property owned by them” upon the line mentioned for the above named sum. The notes were given and are the notes in suit. At the same time the plaintiff covenanted with the Interstate Company that all sums received in payment of the notes should be credited and allowed to the *298Interstate Company upon claims which the plaintiff had against the latter.
There was evidence that the directors of the plaintiff, and, it would seem, of the Interstate Company, were in meeting, or at least were present at the meeting of the stockholders and directors of the Attleborough Company when the vote to buy was passed and the notes given, and that the contracts were made after the matter had been “ threshed out.” Evidence was offered of what was said at the time, either during the meetings or before the parties had left the room, to show that the real understanding was that the notes were given for the value of that part of the road, and upon an estimate of what the claims of the plaintiff against the Interstate Company would amount to, but that it turned out that the Interstate Company did not owe the plaintiff anything. The evidence was excluded, and the defendant excepted.
The judge ruled, subject to exception, “ that the Attleborough Company had the right to purchase the materials belonging to the plaintiff corporation, which was purchased, and for which these notes were given, and that it would be a good and sufficient consideration for the notes,” and, evidently thinking that any rulings asked by the defendant would be rulings preventing the plaintiff from recovering, which he had met by ruling the other way, found for the plaintiff without looking at some requests handed him on the defendant’s behalf. One of these was that the Interstate Company was prohibited from making such a sale as the present by Pub. Sts. c. 113, § 56, forbidding a street railway company to sell or lease its road.
We mention this last request of the defendant in connection with the exception to the exclusion of evidence because it shows that along with the alleged failure or want of consideration the defendant relied upon making out an illegal scheme, and it is not unreasonable to suppose that the evidence offered was expected to throw light upon that aspect of the case as well as the other. The aspect of illegality impresses us more than the other, which seems to have been more pressed. We find it difficult to see how the claims of the plaintiff against the Interstate Company can have been the consideration for the notes. What the defendant was trying to do looks much more like an effort to *299override the promise to pay a certain sum, contained in the notes, by oral evidence that the real undertaking was to pay an amount equal to the claims. This was in flat contradiction of the instruments, and could not be done. But while the judge was right upon the point to which his attention was most directed, we cannot help thinking that the possible illegality of the scheme was not sufficiently considered.
We agree that if the sale was in the terms of the vote, and those terms were legal, it would be none the worse that the transaction came very near to illegality, and was framed so as to avoid it. One meaning of drawing a line between the lawful and the unlawful is that you have a right to get as near the line as you can if you do not cross it. If the sale was a sale of personal property only, and of personal property the title to which never had passed to the Interstate Company, it is no less good if the Interstate Company refused to accept the title in order that the sale might be made, and because it doubted whether it could make a sale after it became the owner. But suppose that it was understood by all the directors at the time of passing their several votes that what really was intended was a transfer of its location by the Interstate Company to the Attleborough Company, and that the vote was put in the form which it took to conceal that purpose. If that was the real understanding and bargain between the directors, the fact that it was not expressed in their vote would not save the corporate action from illegality. It is true that there could not be a technical transfer without a vote. But the law wants to prevent the actual as well as the technical transfer. If in the minds of the movers of the corporations the sale was a means to the abandonment of the road by one company and its occupation and use by another, the law will not be blinded to the character of the act because they had wit enough not to betray their scheme in a vote. And certainly there was some color for a finding that the scheme which we have imagined actually was entertained, for a witness testified that the Interstate Company abandoned their road, and about two weeks after the sale the Attleborough Company was using the property. If the evidence offered had been admitted, perhaps even on the evidence as it stood if the judge had paid attention to the *300defendant’s requests for rulings, he might have found that the foregoing was the actual state of the case.
But take the evidence as it stands, and assume that the whole transaction was as it appears in the votes, even then thére is a question. It is true that the Attleborough Company’s vote, as we have pointed out, was to buy the material and other property “ owned by ” the plaintiff, words not used in the plaintiff’s vote. But it is plain that both votes meant, and were construed by conduct to mean, the tracks which had been laid as well as the loose material. Now, as to these, it was all very well for the Interstate Company to profess to refuse to accept them, but the title had passed as soon as the rails were annexed to the freehold. The plaintiff had no franchise or easement there. The Interstate Company had. It is not necessary to consider whether the rails became real estate and followed the easement. Hunt v. Bay State Iron Co. 97 Mass. 279, 282. Meriam v. Brown, 128 Mass. 391. When laid down they became part of the Interstate Company’s road within the meaning of the statute, whether they were realty or personalty. Only as part of that company’s road had they a right to be where they were. The company had no more right to sell its rails for the purpose of removal, with the intent that its road for those four miles should be abandoned, than it had to sell them to be kept where they were and to be used along with the franchise by the buyer. Richardson v. Sibley, 11 Allen, 65, 70.
Upon the foregoing considerations it seems to us that justice to the defendant requires a new trial, at which evidence shall be admitted of any conversations or understandings between the directors of the several companies, at the time when they were all together and when the votes were passed, tending to show an illegal scheme such as we have supposed. And if the evidence does not give a different color to the facts, we think the defendant will be entitled to a ruling that the Interstate Company had acquired a title to the rails which had been laid and could not lawfully become a party to a transaction by which in substance it sold that part of its road.

Exceptions sustained.