Chapman v. Yellow Poplar Lumber Co.

• Decision Date: 06 February 1906
• Docket Number: 612.
• Citation: 143 F. 201
• Parties: CHAPMAN v. YELLOW POPLAR LUMBER CO. et al.
• Court: U.S. Court of Appeals — Fourth Circuit

143 F. 201

CHAPMAN v. YELLOW POPLAR LUMBER CO. et al.

No. 612.

United States Court of Appeals, Fourth Circuit.

February 6, 1906

J. F Bullitt (Bullitt & Kelly, on the brief), for appellant.

John N Baldwin, for appellees.

Before PRITCHARD, Circuit Judge, and PURNELL and KELLER, District judges.

KELLER District Judge.

The two assignments of error relied on relate to two different decrees entered in this cause; the first having been entered December 11, 1893. The errors complained of in that decree are (a) in dissolving the attachment theretofore issued; (b) in discharging the receiver and requiring him to turn the property in his hands over to the defendants M. T. Green, F J. O'Connell, and Yellow Poplar Lumber Company, etc.; (c) in awarding costs in favor of said defendants upon the question of the receivership; (d) in requiring the plaintiff 'to replead therein by filing a declaration or declarations at law for the purpose of prosecuting his claim for damages herein for alleged breach of contract by defendants, and for other legal damages, and complainant is given until the 1st day of March, 1894, to file said declaration. ' Of these matters, all except the last have admittedly been settled by a compromise agreement entered into between the parties on August 16, 1895, and we will now proceed to consider the error in said decree alleged to exist by reason of the direction of the court that the plaintiff recast his pleadings by filing a declaration or declarations at law for the recovery of the damages alleged by him in his bill to have been suffered by reason of an alleged breach of contract, etc.

In order to understand the situation which was then confronting the court, it is perhaps necessary to make a brief statement of the condition of this suit at the time the decree complained of was entered. Chapman in 1893 had brought a suit in three certain agreements entered into on February 9, 1893 between himself and Green & O'Connell, representatives and agents of the Yellow Poplar Lumber Company. By the first of these agreements (Exhibit 100) Chapman bound himself to deliver to Green & O'Connell, at certain points mentioned in said agreement 50,000,000 feet of timber that he owned or controlled 'being a portion of 42,000 (trees) that are bought in the style of Albert Pack, trustee, and also 32,000 trees that are owned and controlled by S. F. Chapman as an individual. ' This agreement contained a proviso as follows:

'Provided that, should the trees above referred to fall short of said fifty million feet, then said Chapman agrees to make up the shortage in a manner satisfactory to said Green and said O'Connell.

The agreement contained further provisions as to the prices to be paid for logs, etc., and provided for the execution by Green & O'Connell of two notes for $5,000 each to Chapman, the proceeds of which notes were to be used by Chapman to pay off certain claims in the way of purchase money due to C. D. Cushing, a former partner of Chapman, and also to secure the release of a certain bill of sale on Chapman's interest in the said 42,000 trees, made by him to Geo. W. Peck. The principal of said advance of $10,000 was to be repaid to Green & O'Connell by a deduction of 10 per cent. of the monthly payments due by them for logs under the contract. Chapman agreed to deliver 10,000,000 feet, or more, of the said timber each year, and in case he failed or neglected to carry out the contract it became the right and duty of Green & O'Connell to do so, charging expenses to Chapman and paying him the difference, if any, between the cost and the contract prices. By the second of said writings (Exhibit 101) Chapman sold and conveyed to Green & O'Connell 'all my present or future right, title, and interest' in the 42,000 Albert Pack trees, 'all also in 32,000 trees controlled by me individually. ' By the third of said writings Green & O'Connell agreed that, if the said Chapman performed his part of the first agreement faithfully, they would reconvey to him all their interest in the trees covered by the second agreement. These three agreements read together, clearly show that the agreement, Exhibit 101, was simply intended as a mortgage or assignment of Chapman's interest in the trees from which he was to make his deliveries under the principal contract, for the security of Green & O'Connell, and that, in the event Chapman failed to perform his contract, they might do so without any question as to their right to cut these trees. It is admitted in the record that Green & O'Connell were officers and agents of the corporation defendant, Yellow Poplar Lumber Company, and that these contracts were made for its benefit, and that it assumed the obligations thereof.

In September, 1893, Chapman filed his bill in the Circuit Court of Wise county, Va., against Green, O'Connell, Yellow Poplar Lumber Company, S. Bitely, J. C. Kerr, and any unknown parties having interest in the subject-matter of the suit, charging that the three defendants first named had failed to carry out their contract in making payments to him for logs delivered on the heads of streams, and had finally refused to make any settlement with him; that without such settlement and payments he was unable to carry on said contract; that if these defendants had carried out their part of said contract he could and would have made a profit of at least $100,000; that Exhibit 101 above referred to was merely a mortgage, and that Green & O'Connell (and their principal, the Yellow Poplar Lumber Company), having failed to carry out the contract, ought to be required to reconvey the timber to him, Chapman; that he (plaintiff) was entitled to one-third of $2,500, certain profits made in stores of defendants; and that upon an accounting for work done under the contract, defendants were largely indebted to him, etc. Thereupon he prayed that the property of the first three defendants in Virginia be attached, that a receiver be appointed to take charge of the logs and other personal property mentioned in the bill, that he be given a decree for the various sums alleged to be due him, that a commissioner be appointed to make and state an account between the parties, and that Green & O'Connell be directed to reconvey to him the said trees. The attachment prayed for was issued and levied on certain trees which were owned by Yellow Poplar Lumber Company in Dickenson and Buchanan counties, Va., and a receiver was appointed. Thereafter a petition for removal was filed, and the cause (without objection on the part of plaintiff) was removed to the Circuit Court of the United States for the Western District of Virginia.

On October 4, 1893, the plaintiff filed a petition in the cause, which was treated as an amended and supplemental bill, upon the prayer of which a receiver was appointed by the court and an injunction awarded restraining Green & O'Connell, the Yellow Poplar Lumber Company, their officers, agents, servants, and employes, from removing any of the cut logs or other personal property placed in the custody of the receiver, and from interfering in any way with the receiver in the performance of his duties. The defendants thereafter demurred to the bill, one of the grounds of demurrer being stated to be that the bill contained both legal and equitable causes of action. In December, 1893, the cause came on to be heard before the late Judge John Paul, in chambers, at Harrisonburg, and on December 11, 1893, Judge Paul passed an order dissolving the injunction, discharging the receiver, releasing the attachment (except as to certain standing trees deemed by him sufficient in value to protect the plaintiff), referring the case to a master for the purpose of ascertaining the state of the accounts between the parties, and containing a clause as follows:

'And the defendants having demurred to the bill on the ground, inter alia, that there is a misjoinder of legal and equitable causes of action therein and moved the court to require a repleader by complainant, the court doth adjudge, order, and decree that the plaintiff be, and he is hereby, required to replead herein by filing a declaration or declarations at law for the purpose of prosecuting his claim for damages herein, for alleged breach of contract by the defendants, and for any other legal demands.'

From the whole of this order Chapman prayed and was allowed an appeal, but never perfected the appeal asked for, and, being advised that said order, being interlocutory, was not then appealable, filed his declaration at law, claiming $100,000 damages on account of the profits which he would have made had he been allowed to carry out the contract. This suit eventually resulted in a judgment in favor of the defendants. We are now called upon to say whether there was error in that part of Judge Paul's order quoted above, and, if so, whether there was reversible error.

Before passing upon that question, however, we may say that the order of December 11, 1893, although interlocutory, was unquestionably appealable, by reason of the fact that it dissolved the injunction awarded in the order of October 4, 1893, see Act March 3, 1891, c. 517, Sec. 7, 26 Stat. 828, as amended by Act Feb. 18, 1895, c. 96, 28 Stat. 666 (U.S. Comp. St. 1901, p. 550). And it is well settled that on an appeal from an interlocutory order the court has power to hear the whole case and dispose of it. Clark v. McGhee, 87 F. 789, 31 C.C.A. 321; Mayor of Knoxville v. Africa, 77 F. 502, 23 C.C.A. 252;

Bissell Carpet Sweeper Co. v. Goshen Sweeper Co., 72 F. 545, 19 C.C.A. 25; Consol. Piedmont Cable Co. v. Pacific Cable Ry. Co., 58 F. 226, 7 C.C.A. 195; Smith v. Vulcan Iron Works, 165 U.S., 518, 17 Sup.Ct. 407, 41 L.Ed. 810.

However while we think the interlocutory order...