Downes v. Long Timber &. Lumber Co

• Citation: 128 S.E. 385
• Decision Date: 02 June 1925
• Docket Number: (C. C. No. 263.)
• Court: Supreme Court of West Virginia
• Parties: DOWNES et al. v. LONG TIMBER &. LUMBER CO. et al.

128 S.E. 385

DOWNES et al.

v.LONG TIMBER &. LUMBER CO. et al.

(C. C. No. 263.)

Supreme Court of Appeals of West Virginia.

June 2, 1925.

(Syllabus by the Court.)

Certified Questions from Circuit Court, Harrison County.

Suit by J. M. N. Downes, trustee, and others against the Long Timber & Lumber Company and others. After overruling demurrer to amended bill of complaint, court certified questions. Ruling affirmed.

E. G. Smith and D. D. Johnson, both of Clarksburg, for plaintiffs.

Charles B. Johnson, of Clarksburg, for defendants.

WOODS, J. In the year 1921, two actions at law and a suit in equity were instituted in the circuit court of Harrison county against Long Timber & Lumber Company and others, defendants. In the first action at law, Roy H. Mace and Upton W. Mace, partners doing business as Mace Bros. Lumber Company, were the plaintiffs, and Long Timber & Lumber Company, a corporation, was the defendant. In the second action at law, said Roy H. Mace and Upton W. Mace, partners as aforesaid, and C. D. Munson, William Post, and J. M. N. Downes, trustee, were plaintiffs, and Long Timber & Lumber Company was the defendant. In the suit in equity, said J. M. N. Downes, trustee, and said C. D. Munson and William Post were the plaintiffs, and Long Timber & Lumber Company, a corporation, and said Roy H. Mace and Upton W. Mace, partners, under the firm name of Mace Bros. Lumber Company, and Roy H, Mace, Upton W. Mace, Flossie Mace, Anna D. Mace, J. E. Long Coal Company, a corporation, and J. E. Long, were defendants. The relief in each case was sought against Long Timber & Lumber Company. The defendant Long Timber & Lumber Company moved, in the equity suit, that the plaintiffs common to each suit elect in which suit or action they would seek their relief. The court denied such motion as made, but granted the same to the extent that such plaintiffs were ordered to elect as between the two law actions. The plaintiffs did, in pursuance thereof, dismiss the law action No. 1. Law action No. 2 and the said chancery suit are still pending. The defendants Long Timber & Lumber Company, J. E. Long Coal Company, and J. E. Long, being related in interests, then demurred to the bill of complaint. The court sustained the demurrer. The plaintiffs to the original bill of complaint then moved to amend by transposing the four Maces from defendants to plaintiffs, and in other respects supplementing the allegations of the original bill, and tendered with such motion such amend ed bill of complaint, and the said defendants, the two Long Companies and Long (being the remaining defendants), objected to the granting of the right to so amend, which objection being overruled, the amended bill was then filed, and the said defendants then appeared and, without waiving such objection, demurred to the amended bill of complaint, and, this being overruled, the court then certified questions to this court respecting (a) the validity of its action in granting such right to amend, and (b) the sufficiency of the amended bill of complaint.

To a proper consideration of the questions involved on certificate, a brief statement of the cause of action as set out in the original bill, as well as the facts supplementing it by way of amendment, is necessary. The cause of action arises upon a written contract, set forth in luxe verba, in the bill, bearing date July 15, 1919, and made by Roy II. Mace and Upton W. Mace, partners as Mace Bros. Lumber Company, as first parties; C. D. Munson and William Post, as second parties; and Long Timber & Lumber Company, as third party. Under that agreement the Mace Bros., who owned a sawmill grant, certain manufactured lumber, and standing timber on certain lands, sold to the Long Timber & Lumber Company lumber then manufactured upon special terms as to the prices, times of delivery, and amounts and kinds of lumber, and agreed to manufacture and deliver other lumber. This agreement was made subject to the terms and conditions of a prior contract, made between the first and second parties above named. By said prior contract, which is likewise set out in full in the bill of complaint, dated October 2, 1918, it seems that Munson and Post engaged to loan money to the extent of $12,000 to Mace Bros, to finance them in the purchase and manufacture of such timber, and, to secure the same upon advancement thereof, Mace Bros. (1) were to sell the lumber at the market price, invoice the same in the name of Munson and Post when shipment of any lumber was made, and to apply out of the total sales price of each 1, 000 feet when collected, $20 thereof to the liquidation of the Munson and Post debt; (2) were to pay Munson and Post 6 per cent. interest on the debt of Mace Bros. to Munson and Post, and, in addition thereto, were to pay the sum of 10 per cent. of the sales price of the lumber; (3) and, by way of security for the payment of the above sums, all the timber, lumber, machinery, and the lands, etc., of the Maces were conveyed to J. M. N. Downes, trustee. It was provided that, in case the timber was not manufactured in two years, or in case default was made in the repayment of the debt in two years, then, upon written notice, the trustee was authorized to sell in the usual manner, the property conveyed to saidtrustee in the order set out in the instrument. While the defendants Long Company and J. E. Long were not parties to the contract of October 2, 1918, the contract of July 15. 1919, in which said defendants were named as third parties, was made subject to the terms and conditions of the contract of October 2, 1918, between the first and second parties "as to persons to whom payment is made and consent to the sale."

The bill further alleges the recordation of the said contract of October 2, 1918, prior to the execution of the agreement of July 15, 1919; that all the standing timber and all the logs, all the manufactured lumber, the sawmill at which the lumber was theretofore and thereafter manufactured, and all the property here in controversy, contemplated and mentioned in said contract of July 15, 1919, is included in said contract of October 2, 1918, and always has been and still is subject to the terms thereof; that the said J. M. N. Downes, trustee, accepted the trust, and that advancements contemplated therein had not been repaid to the said Munson and Post, but that a large sum still remains due and owing by Mace Bros. Lumber Company to them; that said trustee has been given written notice by said Munson and Post to sell the property held in trust by him, making sale of the manufactured lumber, the sawmill and teams of horses first, and further notifying the said trustee to make settlement by suit if necessary with the defendant Long Timber & Lumber Company before making sale under said trust deed; that the debt secured by said trust deed was derived from, and grows out of, a subsequent contract to which Munson and Post were parties, subject to said contract containing said deed of trust, and growing out of the lumber manufactured under said two contracts, and therefore first applicable to the payment of said Munson and Post debt, and involves many transactions on both sides, both in favor and against said Long Timber & Lumber Company; that said transactions involved matters not easily ascertainable by a jury, and to the ascertainment of which a law court is not well adapted, but easily ascertained by a court of equity, and to which the machinery of equity is well adapted for the purpose of ascertaining them; that Long Timber & Lumber Company entered into said contract with notice actual and constructive that the same was a trust and had been so dealt with between the parties to the various contracts, including the said defendant lumber company on its part.

The bill further alleges that on the 21st day of July, 1921, the said Long Timber & Lumber Company conveyed to the said J. E. Long Coal Company 2.18 acres of land situate to the city of Clarksburg, and that the deed conveying the same is fraudulent and void as to the plaintiffs; that the said Long Timber & Lumber Company is owned and controlled by the defendant J. E. Long; that the said J. E. Long Coal Company is owned and controlled by the defendant J. E. Long; that the said J. E. Long caused said fraudulent transaction to hinder, delay, and defraud the plaintiffs, of their rights in this suit; that no consideration passed for said deed, and that the said deed was, in fact, voluntary; that, if said deed is not actually void, it is at least an unlawful preference; that the Long Timber & Lumber Company has no property other than the said lot hereinbefore mentioned, and is insolvent and was insolvent on the 21st day of July, 1921, the day said deed was executed, and ever since has been insolvent.

The bill further alleges that the plaintiffs are entitled to have specifically enforced said...