Carley v. Graves

• Decision Date: 08 May 1891
• Citation: 85 Mich. 483,48 N.W. 710
• Court: Michigan Supreme Court
• Parties: CARLEY v. GRAVES.

48 N.W. 710

85 Mich. 483

CARLEY v. GRAVES.

Supreme Court of Michigan

May 8, 1891

Appeal from circuit court, Menominee county, in chancery; J. H STEERE, Judge.

B J. Brown, for appellant.

Sawyer & Waite, for appellee.

CHAMPLIN C.J.

Graves was appointed receiver of the Ingalls, White Rapids &amp Northern Railway Company, a corporation under the laws of Michigan, operating a logging railway in Menominee county. J H. Kiel was treasurer of the corporation before it went into the hands of the receiver. In January, 1888, William A. Carley sold to one William Stannard a team of horses for $200, and took a promissory note therefor, of which the following is a copy: "Menominee, Mich., January 19, 1888. Ninety days after date, for value received, I promise to pay to Ingalls, White Rapids & Northern Railway Company, or order, at the First National Bank of Menominee, two hundred dollars, with interest at the rate of eight per cent. per annum until paid. [Signed] WM. STANNARD." Said note was indorsed on the back as follows: "We, the I., W. R. & N. Ry. Co., guaranty payment, provided the within amount is due him at the expiration of the allotted time. J. H. KIEL, Treasurer." On the 31st of March, 1888, Stannard had a settlement with the railway company, and they retained out of the amount due him $205, which amount was charged to him on the books of the company, and William A Carley was credited with the same amount. Carley was informed that the amount was retained by the railway company for him, and he demanded the same of the company. The company offered to give him its note, which he refused. After the appointment of the receiver in the foreclosure suit, Carley filed his petition, praying that the receiver be ordered by the court to pay over to him the amount of principal and interest at 8 per cent. of the said note, out of the property in his hands, claiming that the said receiver held the amount as a trust fund, and not as the property of the defendant company. He filed his claim in the suit against the receiver, and the receiver answered denying that he had any money whatever in his hands, as receiver, belonging to Carley, and denying that any money was turned over to him as such receiver by the defendant company. Testimony was taken in support of the claim filed, in which the facts, as above delineated, as to the sale of the horses and the giving of the note and guaranty of payment, appeared; also that the company settled with Stannard, and retained from the amount due him $205, which was charged to Stannard, and credited to Carley. The receiver was also sworn, and testified to the charges and credits as they appeared upon the books of the corporation under the date of March 1, 1888. He further testified that he did not come into possession of any money of the railway company as receiver. It was admitted that property of the railway company came into his hands as receiver of the railway company under a bill filed to foreclose a mortgage, which property was covered by the mortgage. It further appeared that, at the time of the service of the petition of Carley, the receiver had in his hands a sufficient sum in money derived from the sale of property covered by...