Bosler v. Coble

84 P. 895, 14 Wyo. 423, 1906 Wyo. LEXIS 20

• Court: Wyoming Supreme Court
• Decided: April 2, 1906
• Status: Published

Opinion

Scott, Justice.

Plaintiff in error who was defendant below and who will hereafter be referred to as the defendant, seeks to reverse a judgment obtained against him by the defendant in error, who was the plaintiff below and who will be referred to as the plaintiff, in the District Court of Albany County for the amount claimed to be due upon two certain promissory notes.

In 1896 the plaintiff, Coble, applied to the defendant, Bosler, for a loan, and as a basis of credit therefor furnished the defendant with a statement of the financial condition of the Iron Mountain Ranch Company, and of which company Coble was a stockholder. This company was a corporation organized under the laws of the State of Nebraska with a capital stock of three hundred shares of the par value of one hundred dollars each, and doing business at or in the vicinity of Iron Mountain, Wyoming. One hundred and fifty shares were owned by Coble and a like number of shares were owned by one W. E. Lawrence. The object and purpose of the corporation was to conduct a general ranching and live •stock business, and to purchase, own and control such land and property as was necessary and incident to the successful running and operation of such business. The gross value of the property owned at the time by the company as shown by this statement was $53,925.00; its indebtedness was $14,-716.00, leaving the net value of the property $39,209.00. It was also represented in this statement that the business had been conducted for a number of years, and that there had not been a loss any one year to exceed one per cent of the stock ranched. The acquaintanceship of the defendant and plaintiff had extended over many years, both being reared in the same locality. The result of the negotiations was that the defendant loaned the plaintiff the sum of ten thousand dollars, taking his promissory note therefor; a part of the sum so represented by this note being unpaid was can-celled at the time the notes here sued upon were given. Soon after the loan was made and during the same year, i. e. 1896, Coble, Bosler and Lawrence formed a co-partnership, Bosler taking one-half interest, for the purpose of raising cattle and engaging in the general live stock business. This partnership continued until 1898 when Bosler purchased the interest of Lawrence in the co-partnership and also one-half of his stock in the Iron Mountain Ranch Company, his remaining stock being purchased by Coble, the corporation in the meantime having been reorganized as a Wyoming corporation. The relative interests of the parties in their business dealings being thus fixed, remained so until Bosler bought out Coble’s interest both in the co-partnership and his stock in the corporation, and in payment therefor gave the notes sued on and upon which judgment was recovered; that is to say, Coble owned three-fourths of the capital stock of the Iron Mountain Ranch Company, and a one-quarter interest in the co-partnership, while Bos-ler owned one-fourth of the capital stock of the corporation and a three-fourths interest in the co-partnership property and business. The cattle and ranch business was under the personal supervision of Coble, he reporting the conditions of weather, expenses, increase and losses of cattle from time to time to Bosler who resided in Pennsylvania. Bos-ler made occasional trips to the ranch in Wyoming, and kept the books and accounts of both the corporation and the co-partnership from the reports of sales, losses, calf brandings, expenses, &c., furnished him b}r Coble.

In 1903 defendant purchased plaintiff’s interest in the co-partnership, and also his stock in the corporation, and in payment therefor gave his promissory notes to plaintiff in the sum of twenty-five thousand dollars and in addition cancelled all indebtedness owing to him or to the company by plaintiff. Ten thousand dollars was paid upon these notes, and upon failure and refusal to pay the balance and interest, this action was instituted. The execution and delivery of the notes was admitted, but payment contested upon the grounds: First, it was alleged that the notes were by the terms of the written contract of sale to be paid out of the proceeds of the sale of the cattle; and second, by way of counter-claim for damages by reason of alleged false representations as an inducement and upon which the defendant claims he relied in making the contract, and also for damages for an alleged breach of the contract.

The case was tried to a jury and a verdict for the full amount claimed on the notes and interest returned for the plaintiff. It is conceded that there is sufficient evidence to sustain the verdict, and if the rulings of the court, on matters hereinafter considered, are correct or were not prejudicial to defendant the judgment must stand.

1. The court sustained in part and denied in part defendant’s motion to strike out alleged new matter contained in the reply and answer of plaintiff.

So much of the order as is material for our consideration is as follows: “And the court having- heard the argument of counsel and being fully advised, it is now ordered that the said motion be sustained, and that the following matters contained in the reply and answer of the plaintiff be stricken out in so far as the same may be ground for affirmative relief to the plaintiff; but that the said matters be permitted to stand as defensive matters to the set-off and counterclaim contained in the answer and cross petition of the defendant,” and then follows the matters so referred to. It is urged by defendant that these matters even though limited b)r the order to a particular purpose, went to the jury with evidence in support of them and that he was thereby prejudiced. The motion to strike presented a legal question for the court, and was made long before issue was joined, and consequently before there was anything for a jury to pass upon. The question as to whether there was irrelevant evidence of a prejudicial character in connection with these allegations submitted to the jury is disposed of in the conclusion reached upon another branch of the case. Matter in a pleading is said to be irrelevant “which has no bearing on the question in dispute;” or “something out of which no cause of action could arise between the parties in the particular suit;” or “where it does not affect the subject matter in the controversy and can in no way affect or assist the decision of the court.” (The President, &c., of Lee Bank v. Kitching, 7 Bosw., 664; 11 Abb. Pr., 435.) At the time this ruling was made, neither party had demanded a jury nor could they do so, as the issues had not been made up. The court was not advised as to whether or not the case would he tried by a jury. It was also contended upon the hearing that this order was neither appealable nor reversible. Under our system of appellate procedure the case is before us upon the entire record, and our attention is directed to the alleged error in denying the motion to strike. We deem it our duty to review the question, but viewed as an abstract proposition of law and for the reasons stated, the order, though it may be erroneous, is not prejudicial and therefore not ground for the reversal of the final judgment.

2, At the time of the execution of the notes a contract was entered into between the parties, so much of which as is germane to the issue is as follows: “Now, therefore, said John C. Coble has sold to said Frank C. Bosler all his interest in the corporation and partnership set forth above and hereby sells and transfers these interests to Frank C. Bosler for and in consideration of the payment to him of twenty-five thousand dollars ($25,000.00), receipt of which is hereby acknowledged and for the further consideration the agreement of said Frank C. Bosler to sell all of those properties for the prices as follows: for all lands, including-buildings, improvements of whatsoever nature, all ditches, aqueducts and water rights connected with the land and all equipment and household furniture and supplies thereon sixty-eight thousand dollars ($68,000), for work and saddle horses and mares forty dollars ($40.00) each, for steers three years old and over and dry marketable cows such prices as they will bring on the market, for other cows twenty-five dollars ($25.00) each, calves thrown in, for two-year-old heifers twenty dollars ($20.00) each, for one-year-old heifers sixteen dollars ($16.00) each, for two-year-old steers twenty-eight dollars ($28.00) each, for one-year-old steers twenty dollars ($20.00) each, hulls fifty' dollars ($50.00) each, and after deducting from the proceeds of these sales the sum of two hundred fourteen thousand nine hundred twenty-five dollars ($214,925) with interest at six per cent from May 1st, 1903, until paid and twenty-five thousand dollars ($25,000.00), the sum already paid, to pay to said John C. Coble forty (40) per cent of the net proceeds.”

It is urged and contended by the defendant that the $25,000 evidenced by the promissory notes was to be paid out of the net proceeds of the cattle after he had paid to himself the sum of $214,925.00 and interest. A careful reading- of the contract does not bear out his contention. Indeed, more apt words could not be chosen to express what was in the minds of the parties at the time. The payment by notes obligatory was an absolute payment, and the excess over and above the amount reserved to Bosler and the amount of these notes for which and at prices the property and cattle were to be sold as per the conditions of the contract was to be divided in the proportion of forty per cent to Coble and sixty per cent to Bosler.

The construction of this contract, its terms being clear and there being no ambiguity upon its face, was one of law, and therefore for the court. No evidence of conditions existing at the time of its execution could make its meaning-clearer than the words used in the contract by the parties to express their intention.

In Balch v. Arnold, 9 Wyo., 27, this court among other things says: “And the object of such construction must be to ascertain the intention of the parties; first, b}r an inspection of the deed itself, not only so far as would enable the trial court to inform itself of the language employed, but also to ascertain if upon the face of the original instrument anything appeared which would serve to illustrate such intention ; and second, by hearing any competent evidence which might be offered tending to inform the trial court of the situation of the parties at the time the instrument was executed as further illustrating the intention of the parties at the time.” In Thompson v. Wheatland Mer. Co., 10 Wyo., 86, it was in doubt on the face of the contract as to whether certain payments should be made out of a particular fund and this court held that it was proper not merely to consider the language of the contract, hut also to consider evidence of the circumstances of the parties, the situation of the properties, and other facts tending to explain the sense in which the language of the contract was used. These two cases refer to the adopted and approved method of construing a contract which by its terms is ambiguous or its meaning not clear. Where, however, the contract is not ambiguous, its meaning apparent and the intention of the parties clearly expressed, it is error to resort to proof of collateral facts and surrounding circumstances which would only serve to affirm that already expressed or give it a different meaning by parol testimony. The trial court properly refused to submit the question of the construction of this contract to the jury.

3. Defendant assigns as error the granting of a temporary injunction restraining him, pending the action, from disposing of any of the property of the Iron Mountain Ranch Company or of the firm of Bosler & Coble. The record shows that an injunction was granted conditionally and not to take effect until the plaintiff filed an undertaking in the sum of $10,000.00 with surety to be approved by the clerk of the court. Such injunction or restraining order never became operative as no bond or undertaking was ever filed. Defendant was not injured by the order, and is not therefore in a position to complain. (Diehl v. Friester, 37 O. St., 473.)

4. The defendant sought to recover damages for an alleged breach of the contract in this, that plaintiff had failed and refused to transfer titled and leased land which he held as trustee for the corporation to defendant as trustee for the same purpose, and which he had obligated himself to do. Plaintiff during the trial produced the conveyances and tendered them in open court and held himself in readiness thenceforth to deliver them to the defendant. No objection was made to the form, sufficiency or manner of execution of these transfers, but it is claimed that some of the leases for state lands had expired- during- the time which had elapsed since the execution of the contract. The evidence shows that the possession and occupancy of these lands by the corporation was continuous after, as it had been before, the sale, and that such possession, use and occupancy was in no wise disturbed. The failure b)1' plaintiff to assign the leases did not interfere with or prevent the corporation from applying for and obtaining a renewal of the leases, something which the company would have to do if it desired to continue the use and occupancy of the lands as lessee, either under a lease to a trustee in its favor or to itself. At most the damage under the facts shown for this breach of the contract could be but nominal, and as such did not constitute a counter-claim or set-off to. plaintiff's cause of action.

5. A great many letters between the parties, extending •over many years, were introduced in evidence. When the letters for 1896 were produced and identified, counsel for defendant made the following offer, viz: “For the purpose of showing the representations made from time to time by the plaintiff as to the condition of the herd, the weather, the losses, the increase and other like facts alleged in the cross petition, so much of these letters are offered in evidence by the counsel for defendant.” Whereupon counsel for plaintiff insisted that all of the letters be read in their en-tiret)'' and the court so ruled, to which ruling exception was duly taken. The letters were then read to the jury. The same proceeding was had with reference to the letters of each succeeding year during the continuation of their business relations, the record showing- the same offer, ruling and exception. Much time was consumed in reading these letters.

In an action for false representations am»- evidence is competent which proves or tends to prove the existence of any inducement to rely upon them. In this case one of the inducements as testified to by the defendant was that he had confidence in the plaintiff. These letters in their entirety, though not so offered, showed the confidential personal and business relations existing between the parties, which was proper for the jury to consider in determining whether the plaintiff relied upon the parts of the letters which were offered and also competent as corroborative of defendant’s testimony that he had relied upon the alleged false representations by reason of the confidence he had in the plain-' tiff at the time they were made. It is urged in the argument that the jury were wearied and worn out from listening to the reading of them. The record does not show that the defendant at any time called this matter to the attention of the court, which he might have done after a reasonable number had been read, and thus have relieved the jury from listening to a mass of testimony cumulative in character and which would only tend to encumber the record. The ruling of the court does not appear to have been prejudicial to the defendant.

6. The plaintiff introduced in evidence over the objection of defendant a letter from the former to the latter dated Omaha, Nov. nth, 1902, which contained, among other things,: “I wrote you Nov. 1st telling you conditions on the range and my plan to move steers to feed for winter in Neb. Not to corn feed cattle but to carry them through the winter.” “The grass has not grown and there is now absolutely no grass on the range for cattle. We cannot possibly winter all the cattle on the grass that we have and provision for their care must be made at once. For the past six weeks I have been in correspondence with parties in Neb. where I could have the steers wintered. I wanted to make all preparation for them and when you came out would see that I met the condition sensibly and for the best interests of all concerned. I realize that I should go at once and look at these places and ship to them without any delay. But your letters and telegrams block me for the present in any move of this kind. You refuse to send me the money and it will take considerable to ship these cattle to points in Neb. But they will be closer to market and so much more valuable to us.” “You say in your letter: 'You propose to arrange to winter stock in Neb. It is really a great surprise to me for I remember how greatly you were opposed to this plan when Lawrence so strongly urged it.’ Frank, the situation now is entirely different.- We had then feed in abundance. Now we have none.” “What I want to do for the cattle I know is the very best thing for them. But you prevent me from taking any action and a longer delay may cause us heavy losses. I may not be able to get places for the cattle at a later date.” “Come out and see where our money has gone to. See the work that has been done on the ranch. Instead of you helping me out of the present situation before us you block me from doing anything.” Much evidence was also introduced over objection upon the subject of plaintiff’s reputation as a cow man. In the fourteenth instruction given at plaintiff’s request and over defendant’s objection the jury were instructed that the plaintiff could not be held responsible as manager of either the corporation or the partnership for losses which were the result of the direct interference by defendant with any well considered plans of the plaintiff such as wintering the cattle in Nebraska owing to shortage of feed and hay.

In his second defense and counter-claim the defendant does not question the execution of the notes nor the consideration for which they were given. He does not seek to cancel the notes and the contract of sale for the alleged fraud practiced upon him, but he affirms the contract which he claims he was induced to make by the alleged false representations. It was also alleged that although plaintiff so represented he was not in truth and in fact a person of much skill and good judgment in the kinds of business carried on by the corporation and firm; was not giving and did not give continuous and effective or skillful personal attention to the management of said business; that the numbers and values of the live stock decreased under the management of plaintiff at a rapid rate; that the care, skill and attention employed by the plaintiff in the management of and care of the live stock were not such that the. losses were small, but were such as to aggravate and cause more than' usual and average losses and which were greater than those of other herds in neighboring- regions. It is also alleged that from time to time plaintiff reported to defendant the conditions of the range, stock and losses and that defendant who kept the books and records made accurate entries thereof and that from the records so made from such reports it appeared that on the 20th day of April, 1903, the corporation owned and had upon its ranches and range 2,395 head, and the firm owned and had upon the same ranches and range 3,840 head, making- a total of 6,435 head of cattle after deducting the number sold and five per cent loss for each year which the plaintiff had represented in his reports as excessive. It is also alleged that at the time of executing the notes and contract of sale, and for the purpose of inducing the defendant to make the purchase, the plaintiff represented to the defendant that the records were -correct and could be relied upon, “that the reports and representations previously made were true and that the cattle of said corporation and firm ag-gregated about 7,000 head and that they would count out the full number called for by the records;” * * * “that it was not practical nor possible to count the cattle and that they would have to rely upon the books for the numbers,” and that relying upon these representations defendant did purchase plaintiff’s interest in the corporation and firm on the terms and conditions of the written contract. The alleged false reports incorporated in and from which the records were made up extended over many years and were continuing in nature from the commencement of the business relations of the parties down to the time when they became as is alleged an inducement to defendant to make the purchase. To maintain his contention the defendant introduced in evidence the letters already referred to, in whole or in part, including the dates respectively upon which they were written. Not only were the contents of the letters bearing, upon these reports admitted in evidence, but it was contended and sought to be proven that these statements were false; and it necessarily follows that if such contention be correct that they must have been false at the time they were written. The defendant thus raised the issue in the evidence of the falsity of these reports at a time long prior to any thought or desire of the plaintiff to sell his interests, but on the contrary, when by the evidence he desired to remain in and continue the business. The plaintiff had a right to meet and explain by competent testimony'' any inference to be drawn from or phase of the case reasonably arising or growing out of such evidence. As bearing upon this question it was proper to inquire into the surrounding conditions, the relation of the parties and what if any motive actuated the plaintiff to make any other than true reports at these times. If the losses were greater than reported and so known to him at the time, then his desire to. continue the business as gathered from his letters, and to avoid any feeling of distrust by defendant as to his skill and ability in handling the business, or to prevent being charged with negligence would each and all be an incentive to report the losses less than they actually were. The issue of negligence was inferentially raised in the pleadings and also in the evidence, and as bearing upon this issue the evidence objected to was admitted; and also at the request of the defendant the jury were instructed that if they found that the plaintiff falsely represented himself to be a person of much skill and good judgment in the business owned by the firm and company, or falsely represented that he was giving continuous and effective and skillful personal attention to the management of said business and property, and that the defendant relied upon such representations, then their verdict should be for the defendant. Under this instruction if the jury believed from the evidence that the losses were greater than the average loss among other herds of cattle similarly situated in neighboring regions, and also that the plaintiff possessed the ability and skill to handle that kind of a business they might reasonably under the pleadings and evidence attribute such excess in loss to plaintiff’s negligence. It was evidently upon this theory of the case that the instruction complained of was'given. In effect the jury were cautioned that a recovery could not be had against the plaintiff as manager, for he was not sued in that capacity, and that if he was prevented by any act of the defendant from doing- that which good judgment dictated for the proper care and preservation of the stock, that losses resulting- therefrom could not be attributed to either want of skill or negligence on his paid. The jury were not told, nor was the idea conveyed by the instruction, that these matters would in any wise prevent them from finding for the defendant upon the main issue. It was not therefore prejudicial. The instructions presented the case to the jury fairly and indeed as beneficially to the defendant as the law permits.

7. The defendant assigns as error the denial of his motion for a new trial on the ground of newly discovered evidence material for him and which he could not with reasonable diligence have discovered and produced at the trial. The motion was heard upon affidavits.

1. The defendant claims that, he could prove upon a new trial by one Lawrence, who at the time owned a one-quarter interest in, and who kept the books of, the Iron Mountain Ranch Company, that in 1896 under the instructions of the plaintiff he kept an extra and false record which showed the number of cattle owned by the company as 1,937, whereas b)1, the true record there were not to exceed 1,500 head. It was at this time and as claimed upon the showing of the false statement that plaintiff obtained the loan of ten thousand dollars from defendant. Defendant did not purchase any interest in the corporation until 1898 and both he and plaintiff testify that before he made such purchase the corrected number was given by plaintiff, viz: 1,500. We do not consider this evidence material upon the issue as to whether the sale of plaintiff's interest which took place April 20, 1903, was or was not fraudulent.

2. Upon the showing made the defendant was not deprived of the evidence of one Swank as to what it is claimed plaintiff said at the ranch on April 18, 1903, as to the pending sale except by reason of his own failure to exercise reasonable diligence to obtain the same. He knew this person was at the ranch at the time the negotiations were pending, and plaintiff’s counter affidavit which is undisputed shows that defendant was much in the company of the proposed witness before and during the time of the trial.

3. It was proposed in opposition to the evidence of plaintiff to show by Messrs. Burke & Clark that the plaintiff never transferred or assigned the land scrip or scrip land held by him for the Iron Mountain Ranch Company to them or either of them. As to the understanding of plaintiff as to what constitutes an assignment of the scrip or scrip lands or whether in fact he did so or not is immaterial in view of what we have already stated on that branch of the case.

No prejudicial error appearing in the record the judgment will be affirmed. Affirmed.

Potter, C. J., and Beard, J., concur.