Forlaw v. Augusta Naval Stores Co.

• Decision Date: 13 November 1905
• Citation: 52 S.E. 898,124 Ga. 261
• Parties: FORLAW et al. v. AUGUSTA NAVAL STORES CO. AUGUSTA NAVAL STORES CO. v. YOUNG.
• Court: Georgia Supreme Court

52 S.E. 898

124 Ga. 261

FORLAW et al. v. AUGUSTA NAVAL STORES CO.

AUGUSTA NAVAL STORES CO. v. YOUNG.

Supreme Court of Georgia

November 13, 1905

Syllabus by the Court.

Under the evidence in this case, the question of domicile raised by the plea to the jurisdiction was one of fact, and it was properly submitted to the jury for determination.

In the absence of a proper request to that effect, it is not error for a judge, in his charge upon the question of one's domicile, to fail to draw the distinction between "actual residence" and "legal residence."

As the jury was to determine the question of fact as to whether the defendant had a family, and there was some evidence to show that the defendant's business caused a frequent change of residence, there was no error in giving in charge to the jury sections 1824and1825 of the Civil Code.

The court properly refused a written request to give a charge which assumed that there was no dispute as to an issuable fact.

There was evidence warranting the jury to return the verdict as made by them, and the court did not err in refusing to grant a new trial upon the issue raised by the plea to the jurisdiction.

The relation of principal and agent is a fiduciary one, and the latter cannot make advantage and profit for himself out of the relationship, or out of knowledge thus obtained, to the injury of his principal; and, the agency being established the agent will be held to be a trustee as to any profits advantages, rights, or privileges under any contract made and obtained within the scope and by reason of such agency, and he will be compelled to transfer to the principal the benefit of his contract upon repayment to him of such sums as he may have expended in consideration of the same.

As to one of the defendants, it does not appear that he acted other than as an agent for a codefendant; and there being nothing clearly and distinctly alleged to show mala fides on his part, nor any allegation showing that he participated in the profits arising from the alleged fraudulent scheme or conspiracy, his demurrer, wherein he contended that the petition did not set out any cause of action against him, was properly sustained.

Error from Superior Court, Richmond County; H. C. Hammond, Judge.

Bill by the Augusta Naval Stores Company against D. J. Forlaw and others.From the judgment, both parties bring error.Judgment in each case affirmed.

In the absence of a proper request to that effect, it is not error for the judge in his charge on the question of domicile to fail to draw a distinction between legal residence and actual residence.

The Augusta Naval Stores Company, a partnership composed of Hogan and Heath, filed an equitable petition against D. J. ForlawFrank D. Christie, the Woodward Lumber Company, and the Ellis-Young Company, alleging in substance as follows: The petitioners formed a partnership for the purpose of conducting a turpentine business.For this purpose they acquired leases to about 3,713 acres of land in the county of Richmond, and in order to obtain such leases they had to pay the owners of the properties partly in cash, and the balance out of the profits of the business.To make the cash payments, they borrowed money from the Ellis-Young Company, a corporation of Savannah, and transferred to said company the leases as security."Said leases thus obtained were of the value of $2,500, *** and said company advanced the necessary money to make the payment called for thereby," which amounted to about $800.Petitioners took possession of the tracts of land, and by their agent are still in possession thereof.Some time subsequent to this transaction, petitioners entered into an agreement with the Woodward Lumber Company, under the terms of which the lumber company agreed to lease to petitioners the turpentine privileges on what is known as the "Cashin Mill Tract," containing 2,000 acres, for $6,000 cash and one-half of the net profits realized on said tract, which was to be ascertained by making certain deductions and allowances and then dividing the profits according to the agreed stipulations.Petitioners went into possession of the Cashin mill tract and commenced operations thereon.This lease covered a period of three years.Thereafter, pursuant to an agreement with the Ellis-Young Company, petitioners drew on them for $6,000, attaching to the lease a transfer thereof to the Ellis-Young Company.Petitioners based their authority for drawing on the Ellis-Young Company upon the following letter which was received from said Ellis-Young Company shortly after the first draft: "Yours of the 20th at hand, with leases, which seem to be in order.Your drafts will be paid as advised.When you need anything in the way of axes or tools, let us know."The Ellis-Young Company, instead of paying said draft of $6,000, telegraphed petitioners to "hold draft until papers could be examined and Wade conferred with"; Wade being the agent or inspector of the Ellis-Young Company, who had examined the properties covered by the lease.The matter was suspended until the arrival of J. R. Young, agent of the Ellis-Young Company, "who brought with him one D. J. Forlaw."These persons caused the title to the property to be examined, and inspected the property, and expressed themselves as more than pleased with the turpentine privileges thus obtained by petitioners, but objected to the arrangement whereby the Woodward company should share in the net profits made by petitioners in said turpentine business on said property, whereupon petitioners agreed to make any reasonable change in the contract desired by the Ellis-Young Company.Said Young as agent, as aforesaid, and said Forlaw proposed to petitioners that, instead of conducting the business in the form of a partnership, it would be best to immediately form a corporation to be known as the "Augusta Naval Stores Company," with a capital stock of $7,500, which amount the Ellis-Young Company would lend to the new corporation, the stockholders of which should be as follows: Young, owning one-third; Forlaw, owning one-third; and petitioners, owning one-sixth each--and that this corporation should own all of the leases that had theretofore been transferred by petitioners to the Ellis-Young Company for advances theretofore made, amounting to about $800, and also the lease on the Cashin mill tract.Young and Forlaw further proposed to petitioners that the capital stock to be owned by petitioners in the new corporation could be obtained from the Ellis-Young Company and paid for out of the profits of the business, "petitioner Heath's firm [Heath & Cooper] in the meantime to sell goods to the company and the hands working for the turpentine farms, acting as commissary; and petitioner Hogan to be paid, in addition to the stock aforesaid, the sum of $500 for his services up to that time in obtaining said turpentine privileges."Forlaw was to get a salary to superintend the farms, Hogan to be employed to assist Forlaw when found to be necessary.Said Young stated that rather than have the Woodward Lumber Company interested in the profits of the business, his company would be willing to pay the Woodward Lumber Company more money than the $6,000.

Relying upon these propositions and believing that they would be carried out in good faith, petitioners agreed thereto and thereupon opened negotiations with the Woodward Lumber Company, through Forlaw, which resulted in another agreement being reached under the terms of which the Woodward Lumber Company agreed to waive all of its interest in the net profits and to sell the turpentine privileges in said Cashin mill tract for the sum of $10,000--$5,000 cash, and $5,000 in 12 months.Forlaw then drew two drafts upon the Ellis-Young Company, one sight draft for $5,000, which was paid, and one for $5,000 payable one year after date, which was accepted by said Ellis-Young Company; the lease from Woodward Lumber Company being transferred to the Ellis-Young Company as security for the $10,000."That during all this time from November, 1903, down to the present time (being since the time when petitioners brought from Screven county 15 negro hands, and put them to work upon the turpentine farms hereinbefore referred to), said work has been going on, has been conducted in the name of petitioners; petitioners being in possession of said property, both of the 3,713 acres, and also of the said 2,000 acres of the Cashin mill tract.That since January 9, 1904, petitioners, under the promise aforesaid, having been expecting the said parties, Forlaw, Young, and the Ellis-Young Company, to proceed with the corporation agreed upon, and have allowed the said Forlaw to go upon the turpentine farms aforesaid and supervise the same, they also being still under the control of one Frank D. Christie, who was put in charge by petitioner when the work first started."Forlaw, Young, and the Ellis-Young Company refused to pay petitioner Heath the $500 as agreed, paying him only $300, and refused to fulfil said contract made with petitioners and to recognize their rights in said property, and their refusal to so do was a breach of the contract which released petitioners therefrom.Moreover this breach was the part of a fraudulent scheme on the part of defendants, except the Woodward Lumber Company and Christie, to get control of the turpentine privileges aforesaid.Petitioners have made demand upon Forlaw to discontinue his control over said property and all further operations on the same, as well as to cease his supervision of the employés and Christie; but to no avail.Petitioners have tendered, and continue to tender, to Forlaw, Young, and the Ellis-Young Company, all money heretofore advanced to them by said defendants, and demanded a...