CHAMPLIN
J.
There
appeared to be no dispute between the parties to this suit as
to the right of complainant to file his bill of complaint to
obtain an accounting and winding up of the matters growing
out of the trust relationship between the parties. The
defendant contends that such accounting ought not to include
his claim against the plaintiff, arising out of the acts of
complainant in taking possession of a large amount of
personal property, breaking up his logging contract, and
destroying his business, for which, previous to the filing of
the bill, he had brought an action of trover against the
complainant. To decide this question it will be necessary to
enter at considerable length into the facts out of which the
controversy arises.
In the
year 1879 the complainant and one Wartrous were
copartners, doing an extensive lumbering business at Bay
City, Michigan, under the firm name of McGraw & Co. Defendant
was also a lumberman, and in that year he and McGraw & Co.
entered into a contract for the purchase of certain pine
lands
and agreed to operate thereon, the particulars whereof are
not necessary to be stated other than that there resulted to
the parties a profit in the adventure of which defendant was
entitled to his share, amounting to $2,207.53. On May 8
1880, another contract was entered into between the same
parties, a copy of which is given below, viz.:
"George
E. Dole, of East Saginaw, Mich., party of the first part
and T.H. McGraw & Co., of Portsmouth, Mich., party of the
second part, agree to and with each other as follows, this
eighth day of May, 1880: Said Dole agrees, for a one-half
interest in the hereinafter described operation, to give
his undivided time and attention, free of cost, to said
McGraw & Co., in the lumbering of the following described
lands, viz.: The south half of section twenty-two, north
half of section twenty-seven, north-west quarter of
north-west quarter of section twenty-eight, north-east
quarter of north-east quarter of section twenty-nine, all
in town twenty north, range five east; said Dole to furnish
for said operation whatever funds he may receive from the
joint account operation under contract of October 14, 1879,
between the parties to this contract, after deducting his
necessary expenses, and McGraw & Co. to furnish the
remaining funds necessary to the successful operation of
said lumbering. The entire cost of lands, lumbering, etc.,
together with an interest account of seven per cent. per
annum, to be charged to joint account. The title to said
lands to be in McGraw & Co. until such time as said Dole
shall pay said McGraw & Co. for his one-half interest in
the joint account, when they agree to give said Dole a deed
for one-half of said lands; all of said lands to be
lumbered during the coming winter, if possible; said McGraw
& Co. to have the opportunity to buy said Dole's
one-half interest in said logs, and to have the preference
over any other party, at the same price; said McGraw & Co.
to retain the ownership of said Dole's interest until
such time as said Dole shall pay said McGraw & Co. for his
proportion of the joint account; said Dole to attend to the
letting of the contract for lumbering of said
lands, consulting said McGraw & Co. at all times as to the
conduct of the business; neither party to sign any paper as
partners, or accept any draft, or give any note. GEORGE E.
DOLE.
"T.H.
MCGRAW & CO.
"Per
BIRDSALL."
The
consideration paid by McGraw & Co. for these lands was
$25,500. During the summer or early fall of 1880 a verbal
arrangement was agreed upon, by which it was agreed that
defendant himself should perform the job of lumbering from
these lands, and in pursuance thereof he commenced
preparations to do so. He purchased of one Luther Gordon the
iron rails then on a logging road belonging to Gordon, and
also eleven logging cars. The money to make this purchase was
advanced by McGraw & Co., and a bill of sale as security was
taken in McGraw & Co.'s name. The length of iron rail
purchased of Gordon was about three and eight-tenths miles,
and was moved by defendant, and relaid upon a road-bed
constructed by him from Rifle river to the main body of land
mentioned in the contract. The verbal agreement above alluded
to was afterwards, and on the thirteenth day of September,
1880, reduced to writing, and reads as follows:
"George
Dole, of East Saginaw, Mich., and T.H. McGraw & Co., of
Portsmouth, Michigan, each for a sufficient consideration,
agree to and with each other, this thirteenth day of
September, 1880, as follows: Said Dole to cut, skid, and
haul during the present lumbering season of 1880 and 1881,
and deliver in the Rifle river boom as early as practicable
in the spring of 1881, all the pine timber on the
hereinafter described lands, the title to which is vested
in T.H. McGraw & Co. for the purpose of security for the
purchase price of lands, but one-half of which, when paid
for by said Dole, and one-half
of the logs from which shall also belong to said Dole when
he shall have paid his portion of purchase price of said
lands, and his proportion of the cost of lumbering said
lands, with interest at the rate of seven per
cent. per annum on all sums paid by said McGraw & Co. on
the purchase price and lumbering of said lands, the joint
account to pay said Dole for the cutting, skidding,
hauling, and delivery of said logs in said Rifle river
boom, the sum of three dollars and twenty-five cents per
thousand feet; said logs to be cut twelve feet two inches,
fourteen feet two inches, and sixteen feet two inches in
length, or otherwise, as directed; to be long butted, when
necessary; to be square butted, and to be cut as
economically as possible as regards rots, crooks, shakes,
etc.; and to be scaled by Scribner's rule, straight and
sound, by some man to be agreed upon between the parties.
Should McGraw & Co. purchase said Dole's interest in
logs,--and it is understood and agreed that said McGraw &
Co. are to have the privilege of purchasing said logs at
the market price for such logs, either when all the logs
are banked, or when enough of them have been delivered in
the mill boom to show a fair average,--said McGraw & Co.
may, if they choose, have said logs rescaled by some man to
be agreed upon by the parties, the woods or bank scale to
be a basis for the settlement of the lumbering of said
logs, and the second or water scale to be a basis for the
final settlement for the purchase of the logs. Said McGraw
& Co. agree to pay and said Dole to receive as payment in
full for the lumbering of said lands, in the manner and at
the time hereinbefore mentioned, the sum of three dollars
and twenty-five cents per M. feet, to be paid as follows:
One dollar and fifty cents per M. feet as fast as each 500
M. feet is skidded, and the balance when all the logs are
delivered in said Rifle river boom.
"It
is further agreed and understood that, as security for
money advanced and to be advanced by said McGraw & Co. to
said Dole on account of said lumbering job, that all
horses, harness, T rail, railroad cars, or lumbering
outfit, of whatever kind, purchased or to be purchased for
said operation, including said railroad complete, shall be
and remain the property of said McGraw & Co. until paid for
by said Dole.
"It
is further agreed and understood that the amount advanced
said Dole for the purchase of said outfit shall be deducted
from said above-named advances on skids and on bank as fast
as said Dole can possibly spare any part of said advances
for the carrying on of said operation. It is also agreed
and
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