Court Opinion

ID: 9550574
Source: CourtListenerOpinion
Date Created: 2023-08-07 18:37:28.430166+00
Date Added: 2024-06-11T15:21:48.958118
License: Public Domain

Petition for Rehearing
WARNER, J.
The defendant Colfax Company has petitioned for a rehearing.
It is evident therefrom that the defendant misconceives the judicial functions when the court is presented with a motion for nonsuit or directed verdict. Taken by its four corners, the matter in this petition might be appropriately addressed to a jury, for it calls upon this court to appraise the testimony in accordance with defendant’s estimate of its relative weight and value. It is also in the nature of an indictment for our failure to do so in the first instance. Indicative of these things, we find the petition replete with phrases reading: “The Court’s holding * * * is not based on adequate or' proper evidence * * * “ * * * uncontradicted written evidence * * * is brushed aside by this Court in favor of flimsy and conflicting oral testimony * * * “The Court disregards plaintiff’s own testimony * * * “The decision ignores the repeated admissions of plaintiff * * * and “The *302Court rejects the testimony of Carl and Albert Fossi * * * [and] accepts shifting and conflicting oral testimony unworthy of credence and contrary to established business practices * * But it must be remembered that the matter at bar is an action at law. It is not a suit in equity calling for a trial de novo on appeal with the incident duty to make our own independent appraisal of the relative weight of testimony adduced.
We have frequently and consistently defined the powers and limitations of this court when called upon to review alleged errors predicated upon a trial court’s refusal, as here, to grant motions of nonsuit or motions for a directed verdict in law actions. In Fish v. Southern Pacific Co., 173 Or 294, 301, 143 P2d 917, 145 P2d 991, we said:
“ * * * In considering the propriety of these rulings, the motions must be regarded as having admitted the truth of plaintiff’s evidence, and of every inference of fact that may be drawn from the evidence. The evidence itself must be interpreted in the light most favorable to plaintiff. McCall v. Inter Harbor Nav. Co., 154 Or. 252, 59 P. (2d) 697. Where the evidence conflicts, the court may not infringe upon the function of the jury by seeking to weigh or evaluate it, but is concerned only with the question of whether or not there was substantial evidence to carry the case to the jury and to support the verdict. Ellenberger v. Fremont Land Co., 165 Or. 375, 107 P. (2d) 837; Allister v. Knaupp, 168 Or. 630, 126 P. (2d) 317.”
Also see Smith v. Industrial Hospital Ass’n, 194 Or 525, 242 P2d 592, 596; Edvalson v. Swick, 190 Or 473, 478, 227 P2d 183; Dudleston v. Chiravollatti, 184 Or 405, 415, 198 P2d 858. Such inferences favorable to plaintiff may also be drawn from defendant’s as well *303as plaintiff’s evidence. Smith v. Industrial Hospital Ass’n, supra.
We will, however, take notice of some of the petition’s unequivocal and over-positive statements that there is no evidence of certain matters referred to in our former opinion.
The petition states: “There is no evidence that when any of the six loans in suit were negotiated, the corporation owed any money to the partnership or that any such debt equalled the amount of any or all of such loans. * * (Italics ours.)
This bold assertion is evidently inspired by the statement in our opinion:
“Becalling as we again do that when the loans were obtained from the plaintiff, the corporation was indebted to Fossi Bros, for construction still in progress, it follows that the relationship of debtor and creditor subsisted between the Colfax Company and the partnership of Fossi Bros. * * *.”
We did not, however, attempt to demonstrate the existence of this debtor-creditor relationship beyond quoting from the testimony of plaintiff’s witness Hokanson,repeating statements made by Carl Fossi to plaintiff respecting delayed payments of the corporation’s money due to Fossi Bros, under the construction contract. This in and of itself is a substantial item of evidence warranting an inference by the jury that the corporation was then indebted to the partnership and one that cannot be ignored.
For more realistic assurance that the corporation was indebted to the partnership at the time it received the benefit of the Phillips loan, we need look no further than defendant’s Exhibits X, Y and Z.
*304Preliminary to discussing these exhibits of defendant, it may be well to recall that the corporation had earlier entered into a contract with the partnership for the construction of an apartment house on property owned by the corporation. The work had begun early in 1948. At the time plaintiff made his first advance in October, 1948, the apartment building was then within approximately two months of completion. From the beginning of the construction until its termination sometime in January, 1949, the corporation was continuously in the debt of the partnership. This is confirmed by an examination of defendant’s Exhibits X, Y and Z, hereinabove referred to. As a matter of convenience, if not necessity, the corporation arranged for its financing to the extent of $165,500 (inadvertently stated as $165,000 in our former opinion) in the manner and through the agencies referred to in our first opinion. It had given its note in that amount to the Investors Syndicate and secured the same by a mortgage on the apartment property. The funds derived from the loan were disbursed from time to time by the mortgagee to the mortgagor in accordance with a formula approved by the F. H. A. and pursuant to forms supplied by that federal organization. This formula and these forms are reflected by Exhibits X, Y and Z.
It appears therefrom that at certain periods, apparently at the end of each month, the contractor (the partnership of Fossi Bros.) would execute what is denominated as a “contractor’s requisition”, addressed to the corporation as owner of the apartment house under construction and requesting payment for work on the apartment house completed during the preceding month. Each requisition, among other things, carried an estimate of the total cost on completion of construction for each major item of the work and the value *305of the work completed during the period subsequent to the last preceding requisition. These requisitions also disclosed the percentage of the total contract price which had been withheld from previous payments.
Exhibit X is the contractor’s requisition for work done in the month of September, 1948, in the amount of $12,541; Exhibit Y is a requisition for the work done in the month of October in the amount of $5,461; and Exhibit Z is a requisition for the work done in the month of November in the amount of $2,141. To each of these exhibits is attached the F. H. A. ’s authorization for the payment of the requested amounts and its certificate of mortgage insurance covering the same. From each approved payment as made, approximately ten per cent was retained to the credit of the contractor. The accumulation of these retained amounts is shown on each requisition. At the time of the maldng of Exhibit X, dated October 4, 1948, this retained amount was then $15,490; as shown by Exhibit Y, it was $16,097; and as shown by Exhibit Z, at the end of November it was $16,335. These items alone, furnished by and certified to Carl Fossi in his capacity as one of the contracting partnership, are in and of themselves most cogent and persuasive evidence of the existence of a debtor and creditor relationship between the corporation and the partnership at the times that plaintiff made his several advances. In addition thereto, the corporation was in the contractor’s debt for the amount requested by each requisition from the last date of each previous month to and until the moneys called for were approved and insured by the F.H.A. and thereafter paid to the corporation by the mortgagee. An examination of the three exhibits referred to discloses that it took from two to four days to secure the F. H. A.’s approval and, according to Carl Fossi’s testi*306mony, from two to three days thereafter before the corporation received the check.
It will be recalled that Hokanson testified that at the time Carl Fossi negotiated the loans from plaintiff “Mr. Fossi stated that Investors Syndicate had held np their money and that he did not have the funds to pay the carpenters with * * * It was, therefore, within the province of the jury to accept Carl Fossi’s statement made in the presence of Hokanson as warranting a conclusion that it took more than “two or three days” to receive the checks from the mortgagee after they had been approved and insured by the F.H.A. It should not be overlooked that even after the contractor had presented its requisition for payment for work done in the previous month, it was continuing the construction of the apartment house; and during the interim from the presentation of the requisition to and until the contractor received payment therefor, the corporation had incurred further liability for work done during that interval, even though not payable until after the presentation of the next requisition.
We are of the opinion that defendant’s Exhibits X, Y and Z, separately or together, are alone of such a substantial nature that the jury would be justified in concluding not only that the corporation owed money to the partnership at the time plaintiff made his loans but that such debt at all times exceeded the total amount of his advances for the corporation’s use and benefit.
The petition states that:
“The decision utterly rejects and disregards the five cheeks * * * [aggregating $2,180 above referred to] each written out by plaintiff * * *, given to and accepted by plaintiff, and attempted to *307be cashed by plaintiff, on each of five of the six occasions when loans were made.”
Even if made ont by plaintiff, as now claimed, they were nevertheless signed “PERSONALITY MOTORS Carl A. Fossi”. These were offered by defendant on the theory that they evidenced direct loans from plaintiff to Carl Fossi and, therefore, were primarily and solely his obligation. Plaintiff’s theory was that he accepted them only as collateral for the loan which he made to the defendant corporation. These conflicting theories concerning these checks were fairly presented to the jury by the court’s instruction. Evidently the jury accepted plaintiff’s construction of the check transaction and not defendant’s, and we are not at liberty to disturb that conclusion. Certainly plaintiff’s attempt to cash these checks is not inconsistent with his claim of their collateral status. He was at liberty to attempt to realize on his collateral any time after the due date of the corporation’s obligation.
The petition for rehearing complains that:
“The decision disregards the plaintiff’s pleading of an express contract by appellant corporation, and rests upon an alleged implied contract or moral obligation on the theory that regardless of legal technicalities, Albert and Carl Fossi received the benefit of plaintiff’s money and ought to be made to pay for it.
“Thus, the decision is completely outside the pleadings of this case and rests upon alleged issues not properly before the Court * * *
The foregoing statement is a conclusion not justified by the facts nor the law. We can assume that by reason of the allegation of an express contract between plaintiff and the corporation for the repayment of the loans aggregating $2,280, the defendant petitioner implies *308that such allegation without more precluded evidence than the unauthorized loan was thereafter ratified by the corporation. If such is the purport of the foregoing statement in the petition for rehearing, then the defendant is clearly in error.
Masters v. Walker, 89 Or 526, 174 P 1164, was a case wherein the plaintiff alleged in his complaint that “ ‘on or about the — day of April, 1914, defendant employed plaintiff as her attorney to act in the defense of a certain case then pending * * * .’ ” At the trial the plaintiff offered to show that his actual employment took place through an agreement with an attorney previously employed by the defendant and that the defendant later ratified this employment and agreed to pay for the same. This offer of proof was rejected by the trial court and resulted in a judgment of non-suit from which plaintiff appealed. Mr. Justice Burnett, speaking for the court, said, at page 529:
“It is good pleading to allege that an act was done by the defendant, and it is competent to prove that averment by showing that the act was really done by an agent of the defendant therewnto duly authorised, or that it was afterward ratified by the defendant: Kitchen v. Holmes, 42 Or. 252 (70 Pac. 830); Levy v. Nevada, C. & O. Ry., 81 Or. 673 (160 Pac. 808, L. R. A. 1917B, 564); Slevin v. Reppy, 46 Mo. 606; Hoosac Mining & Milling Co. v. Donat, 10 Colo. 529 (16 Pac. 157); Long v. Osborn, 91 Iowa, 160, 163 (59 N. W. 14); Hubbard v. Williamstown, 61 Wis. 397, (21 N. W. 295); Moore v. McClure, 8 Hun, 557; Hand v. Society for Savings, 18 N. Y. Supp. 157; Smith v. Des Moines Nat. Bank, 107 Iowa, 620 (78 N. W. 238); 2 C. J. 904.
“The ultimate question to be determined is whether the transaction is that of the defendant within the meaning of the law. One seeking to establish the affirmative of that proposition should *309allege it directly and not endeavor to arrive at the result by circumlocution or argumentative statement. The allegation may be proved by direct testimony or by evidence of facts from which the law draws the conclusion that the act was that of the principal. It savors strongly of pleading evidence or at least redundancy for the pleader to state that the business under consideration was done by an agent or that, having been transacted without the defendant’s sanction, it was afterward ratified by him.” (Italics ours.)
Also see Scandinavian-American Bk. v. Wentworth Lumber Co., 101 Or 151, 199 P 624; Hinton v. Roethler, 90 Or 440, 177 P 59.
Petitioner feels aggrieved because we did not give reasons for finding no merit in appellant’s assignments of error Nos. Ill, IV and V. Assignments of error Nos. Ill and IV relate to the same matter, being alleged misconduct by plaintiff’s counsel. This grew out of counsel’s statement to the court that he was prepared to show that there were various checks issued against the Personality Motors’ bank account to persons other than plaintiff that were not paid for want of funds. The checks, although offered, were not admitted in evidence. The offer was made after the corporation had been permitted to show the solvency of the Carl Possi account in question by bank statements of the bank against which the checks were drawn. Under the circumstances, we think that the action of counsel did not constitute misconduct and that defendant was not prejudiced thereby. We also note that defendant’s counsel made no motion for a mistrial at that time.
Defendant’s assignment of error No. V is predicated upon the trial court’s refusal to give a requested instruction concerning the use and application of the *310borrowed money in the construction of the apartment house. Insofar as this proposed instruction had any bearing on the issues, it was elsewhere appropriately brought to the jury’s attention by the instructions which the court gave.
The petition for rehearing is denied.