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properties named in the call, and that Nowell said, "The Johnson properties are not to go in;" and that the witness then replied that the form of offer would have to be changed, "and I think I then changed it to include the last 12 properties named in the call.” And Payson deposed to having recently found in a drawer in his safe a typewritten copy of the recorded call, attested by Arthur L. Nowell, in which the names of the Johnson properties were bracketed in pencil. Payson referred elsewhere to the proxies that were given by the other stockholders.
Now, all that Mr. Payson says in his affidavit may be true, without affording any ground whatever to impeach the decree of the receiver's suit. It may have been, and the two letters of Thomas S. Nowell above referred to and Payson's affidavit tend to indicate that such was the case, that the alterations in the notice and the offer were made before the meeting, and not after; that Thomas S. Nowell, shortly before the meeting, and without consulting any one, decided to hold out the Johnson group of claims, and instructed Mr. Payson to prepare the records of the meeting accordingly; and that his son, Arthur L. Nowell, holding the proxies of the other stockholders, accepted, without their knowledge or consent, the altered proposition, all of which, if true, would go to show that, as to Henry Endicott and the other stockholders, the transaction was just as fraudulent as it would have been if the records had been fraudulently altered after the meeting. There is nothing in all this evidence so offered which, taken to be true, tends in any degree to impeach the decree in the receiver's suit, or to show that from and after June 24, 1896, the Berner's Bay Mining & Milling Company was not in equity the owner of the Johnson group of claims, which it paid for in pursuance of Thomas S. Nowell's offer to sell the same. Whether the alterations were made before or after the meeting, it is clear from the evidence in the receiver's suit that Henry Endicott and the other stockholders were not advised of them, that they believed that Nowell's proposition had been accepted, and Henry Endicott, relying thereon, and to carry out his part of the agreement, purchased $27,948.35 worth of the then outstanding bonds of the company which were in default, and bonds in addition thereto to the amount of $42,000.
The other items of evidence which are set forth in exhibits to the bill are presented for the purpose of showing that Henry Endicott, William Endicott, and Wallace Hackett, stockholders of the Berner's Bay Company, recognized the title of Thomas S. Nowell to the Johnson group of claims long after June 24, 1896. The first of these is a letter from William Endicott to Thomas S. Nowell, of date September 13, 1900, in which Endicott referred to certain possible purchasers of the company's mining claims who had expressed the opinion that there was no development to justify their paying much money for them, and said:
"I was afraid yesterday that they would decline altogether; but Mr. Agassiz is to be in town on Friday, and Col. Livermore will talk it over with him, and see if he is willing to go in on the basis of putting up cash to pay the receiver's certificates and the Alaska debts, not to exceed $150,000, and to develop the property, including the Johnson, and to have 51% of the new company-the 49% to be made sufficiently large to fund the bonds and floating
debt and to furnish $500,000 in shares for the Johnson mines.
If we hear from you that you will put in the Johnson, we shall not hesitate to trade."
Also a letter, of date July 18, 1905, from William Endicott to Thomas S. Nowell, in which it is said:
"If the property is what you believe it to be, what you can receive for the Johnson will be quite a fortune in itself. As to your debts, it may relieve you somewhat if I make the following proposition,” etc.
And the writer proceeds with an offer by which Nowell can be relieved of the debt he owed the writer of $825,510.67. Also an agreement made February 6, 1902, between certain corporations and the majority of the holders of the mortgage bonds of the Berner's Bay Company, in which the Nowell Mining & Milling Company is described as "the owners of what is known as the Johnson properties, located near the Northern Belle Gold Mining Company's property in Alaska,” which agreement was signed by Henry Endicott and Wallace Hackett as holders of the mortgage bonds. Also a memorandum of an agreement between the holders of first mortgage bonds of the Berner's Bay Company, parties of the first part, Wallace Hackett, Trustee, party of the second part, and Thomas S. Nowell, Frederick D. Nowell, and Willis E. Nowell, parties of the third part, made on February 26, 1903, in which it is recited that certain named mining properties shall be maintained in their integrity together with the group of mines "known as the Johnson group, and organized into a corporation under the name of the Nowell Mining & Milling Company, which said Nowell Mining & Milling Company is the exclusive property of the parties of the third part.' The purport of the agreement was that the owners of the Johnson properties would add the same to the properties of the Berner's Bay Company, so that the same might be formed into one corporation for the purpose of selling to purchasers.
Now, all of the evidence afforded by these exhibits is in line with the proof that was brought before the court in the receiver's suit. It goes to sustain our conclusion in that case, where we said:
"As to the delay of the intervener Endicott in asserting his rights, his testimony is that he did not discover the fraud until some six months after the stockholders' meeting, and that at that time, in a conversation with Thomas S. Nowell, the latter informed him that the reason why the mines had not beeu conveyed was that they could not convey them, for they had not procured the patent yet.' Endicott testified, further, that thereafter he made search for Nowell's letter to him of June 3, 1896, concerning the proposed sale of the 15 mining claims to the company, but that he could not find it until 1900, and that thereafter Nowell was making endeavors to sell the Berner's Bay and Johnson property together, and that he (Endicott) was more anxious to realize on such deal than to delay the consummation of the same by litigation over the title of the Johnson properties. But he testified that, on finding the letter, he sent a copy thereof to Nowell, and informed him that we consider we have at least a moral claim on the Johnson property.'”
It is alleged that the decree in the receiver's suit is void for want of jurisdiction, that the District Court at Juneau decided that the appointment of F. D. Nowell on February 12, 1898, as receiver of the property of the Berner's Bay Mining & Milling Company was void, and that this court affirmed that decision in Nowell v. International
Trust Company, 169 Fed. 497, 94 C. C. A. 589, and that therefore, in January, 1906, there was no legal receiver to institute the receiver's suit in question. We did not decide in Nowell v. International Trust Company that the appointment of the receiver was void. We reviewed a record in which it appeared that in an action brought by Decker Bros. to recover $154.65 for goods sold and delivered to the Berner's Bay Mining Company and to protect the plaintiffs against liabilities on certain checks and drafts that they had signed, the complaint alleged the propriety of the appointment of a receiver on the ground that the output of the mines for the six months prior to the commencement of the suit was insufficient to meet current expenses, and that creditors were threatening suit, and that the property of the defendant company was in danger of being wasted and exhausted, and that if the property were sold at forced sale there would not. be realized a sum sufficient to pay its indebtedness. We held that upon the allegation of the complaint no proper case was made for the appointment of a receiver in the first instance, and that upon the payment of the claim of the plaintiffs in that action, F. D. Nowell, who had been substituted as receiver, should have reported that fact to the court and obtained his discharge. We said:
"During the whole of the time from his (F. D. Nowell's) appointment as receiver until the appearance of the International Trust Company in the suit, a period of nearly eight years, there was no controversy before the court.”
And we held that, if the corporations defendant to that suit chose to submit to the situation and to conduct their mining operations all those years through the medium of a receiver, they should be held responsible for the expense of the receivership. It appeared in that case that on December 9, 1905, the Berner's Bay Company and the corporations connected with it answered the complaint of Decker Bros., alleging that the receiver had issued under the orders of the court receiver's certificates to the amount of nearly $400,000 for money which he had borrowed and used in the administration of the property and the operation of the same; that on March 5, 1906, the International Trust Company intervened, setting up its mortgage, which was a deed of trust, and obtained leave to commence an independent suit for the foreclosure of the mortgage as a prior lien; that on April 11, 1907, the court ordered that the two suits be consolidated. We may assume, nothing in the record appearing to the contrary, that the court extended the receivership to the foreclosure suit. That record shows, further, that on January 3, 1906, W. B. Hoggatt was appointed coreceiver with F. D. Nowell, and in the order appointing him he and his coreceiver were directed to institute the receiver's suit for the recovery of the Johnson group of mines. At that time the pleadings presented ample grounds for the appointment of a receiver, and the order appointing Hoggatt and the order that he bring the suit were clearly within the jurisdiction of the court, notwithstanding that the appointment of a receiver in the first instance may have been voidable.
The demurrer to the bill in this case was properly sustained.
WISCONSIN STEEL CO. V. MARYLAND STEEL CO.
(Circuit Court of Appeals, Seventh Circuit. January 7, 1913.)
No. 1,863. 1. CONTRACTS ($ 27*)-PROPOSAL AND ACCEPTANCE_IMPLIED AGREEMENT.
Defendant was having three engines built, and, when the work was stopped by a strike in the works of the contractor, made a written contract with plaintiff to complete two of the engines for a stated per cent. above cost. After the work was commenced, defendant's manager, who was in plaintiff's shops, said to the foreman that he was going to send them the third engine to complete, and was referred to the manager. It appeared that he did not see the manager, but the latter was informed by the foreman of the proposal, and when, a few days later, the uncompleted parts of the third engine were received, plaintiff accepted the same and built the engine with the others. Held, that defendant's proposal, taken in connection with the acts of both parties following, constituted a contract for the completion of the third engine, on the same terms as the other two.
[Ed. Note.-For other cases, see Contracts, Cent. Dig. 88 121-132; Dec.
Dig. $ 27.*] 2. CONTRACTS (8 4*) -PROPOSAL AND ACCEPTANCE-IMPLIED AGREEMENT.
Acts and circumstances that show, according to the ordinary course of dealing and the common understanding of men, a mutual intent to contract, may be taken in law as the basis for implying a contract in fact.
[Ed. Note.--For other cases, see Contracts, Cent. Dig. 88 46; Dec. Dig.
§ 4.*] 8. EVIDENCE (88 354, 376*)—BOOKS OF ACCOUNT_ADMISSIBILITY.
A machine works employed in its shops 4,500 men, and in order to know the amount paid out in, wages on each piece of work it adopted a system under which each workman filled out a daily time card, showing the amount of time he was employed on each job, and from such cards the bookkeepers made proper charges in the book accounts kept with each piece of work in terms of money, based on the wages paid the workman. Held, that such book entries, properly authenticated, were admissible in evidence against the person charged, and that the time cards were also admissible as corroborative evidence, without proof of the handwriting of the workmen making the same, both under the general law of evidence and under St. Wis. 1911, 88 4186, 4187, 4189, the latter of which provides that, in case entries "are, in the usual course of the business, also made in other books or papers as a part of the system of keeping a record of such transactions, it shall not be necessary to produce as witnesses all of the persons subject to subpæna who were engaged in the making of such entries,” if the court shall be satisfied of their genuineness.
[Ed. Note. For other cases, see Evidence, Cent. Dig. 88 1432-1483,
1628–1646; Dec. Dig. 88 354, 376.*] 4. EVIDENCE (8 354*)—BOOKS OF ACCOUNT-ADMISSIBILITY.
That workmen's daily time cards, under the system of bookkeeping employed in a large machine shop, showed the time the workman was employed on each particular job, while the book entries made therefrom were in terms of money, and not of time, constitutes no objection to the admissibility of such books in evidence.
[Ed. Note.—For other cases, see Evidence, Cent. Dig. $81432-1483; Dec. Dig. $ 354.*] For other cases see same topic & S NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes
3. PAYMENT (8 70*)—EVIDENCE-RECEIPTS FROM THIRD PARTIES.
Where a contract by which plaintiff agreed to build engines for de fendant required defendant to deliver certain castings therefor f. o. b. at plaintiff's shops, receipts from the railroad company for freight paid by plaintiff on such castings are admissible in evidence in support of charges made against defendant for such freight.
[Ed. Note.-For other cases, see Payment, Cent. Dig. 88 203, 204, 206– 218; Dec. Dig. $ 70.*]
In Error to the Circuit Court of the United States for the Western District of Wisconsin; Arthur L. Sanborn, Judge.
Action at law by the Maryland Steel Company against the Wisconsin Steel Company. Judgment for plaintiff, and defendant brings error. Affirmed.
Maryland Company recovered judgment against Wisconsin Company for a balance alleged to be due for work done by Maryland Company at its shops on three engines for Wisconsin Company.
Work on two of the engines was admittedly covered by a written contract between these parties. Circumstances leading to the execution of this contract were these: Wisconsin Company had a written contract with Mesta Company of Pittsburgh for the three engines. A strike in the Mesta shops stopped the work. Wisconsin Company, in urgent need of the engines, tried to have Mesta Company sublet the work. Maryland Company declined to enter into any relations with Mesta Company, but made the following contract with Wisconsin Company:
"The work to be performed to this agreement is the complete machining of parts and assembling of same of two (2) low pressure Westinghouse blowing engines.
"It is agreed between the parties of this contract that the castings for said engines, including all parts to be machined, shall be delivered free on board cars Sparrows Point, the same to be machined as per blue 'prints and specifications submitted, and delivered f. o. b. cars Sparrows Point, Md.
"It is understood and agreed between the parties of this contract that the consideration for the work to be performed shall be cost, plus burden (afterwards agreed upon as 40% of cost), plus 10%; the 10% being profit over and above actual cost and burden, which it is agreed shall be paid the Maryland Steel Company, as their bills may be rendered from time to time, and shall be paid when the machined parts are delivered on board cars at Sparrows Point.
"It is understood and agreed between the parties of this contract that an inspector employed by the Wisconsin Steel Company shall be admitted to their works during working hours and allowed to inspect and pass on any parts of said work under way, and it is further agreed that any work rejected by said inspector, owing to imperfect workmanship, or other reason, shall be open to adjustment between the inspector and your general superintendent, or foreman of shop, and it is agreed that, if these two parties cannot agree, the third party shall be called into settle the dispute."
Thereupon Mesta Company agreed to indemnify Wisconsin Company against having to pay more for the two engines than the Mesta contract price.
Maryland Company made and delivered the three engines, and claimed pay for the third engine under an alleged parol contract of the same tenor as the written contract. Wisconsin Company then for the first time realized that it had failed to take indemnity from Mesta Company for the third engine, and denied the alleged parol contract.
At the trial plaintiff undertook to show (1) the existence of the alleged parol contract and (2) the actual cost to plaintiff of machining and assembling the parts of the three engines. (For the additions of 40 per cent. burden and 10 per cent. profit are merely matters of calculation.) The jury by their general verdict, and also in answer to a special question, found that the parol *For other cases see same topic & $ NUMBER in Dec. & Am. Digs. 1907 to date, & Rep'r Indexes