Grant v. Fletcher

• Decision Date: 01 July 1922
• Docket Number: 4003.
• Parties: GRANT (WESTON et al., Interveners) v. FLETCHER et al.
• Court: U.S. District Court — Eastern District of Michigan

283 F. 243

GRANT (WESTON et al., Interveners) v. FLETCHER et al.

No. 4003.

United States District Court, E.D. Michigan, Southern Division.

July 1, 1922

[Copyrighted Material Omitted] [Copyrighted Material Omitted]

Harrison Geer and Harold R. Martin, both of Detroit, Mich. (Walter B Grant, of Boston, Mass., of counsel), for plaintiff.

A. C. Angell, of Detroit, Mich., for intervening plaintiff Weston.

Edward S. Clark, of Bay City, Mich., for defendants.

TUTTLE District Judge.

This is a case of unusual interest and importance. It involves business transactions originating more than 60 years ago, and the matters in controversy have been in litigation in the courts of Massachusetts and Michigan and the federal courts for nearly 50 years. All the original parties are now dead, and it has been necessary to establish the essential facts almost wholly from documentary evidence. The original litigation, commenced in the Massachusetts courts in 1874, ended with the opinion of the United States Supreme Court in May, 1908 (210 U.S. 82, 28 Sup.Ct. 702, 52 L.Ed. 966) which held that the Massachusetts litigation abated on the death of the defendant therein, George N. Fletcher, in November, 1899. The present suit was then instituted in this court in October, 1908, and has proceeded to the master's report on the accounting, which is now before me on exceptions and petitions of the parties for special allowances.

In the late 50's, George N. Fletcher was a resident of St. Clair, Mich., where he was the owner and operator of a sawmill. He was also the owner in his own right of several thousand acres of timber lands in Northern Michigan, which he had obtained by government patents. He had acquired skill and reputation as a practical lumberman. Thomas Campbell, of Boston, Mass., was a clerk in the office of the secretary of state of Massachusetts, where he had unusually good facilities for obtaining land warrants issued to soldiers who served in the Mexican and other wars. Fletcher had formerly lived in Massachusetts, and may have been acquainted there with Thomas Campbell. In any event, the two got into communication in 1855, as a result of which a contract was made between them, under date of March 13, 1856, whereby Campbell agreed to invest $6,000 and such further sums as he might elect in pine lands in the vicinity of Thunder Bay river, and its tributaries, in Northern Michigan. Fletcher was to give diligent attention to the selection, care, and sale of the lands, the locations of which were to be entered in Campbell's name. One-half of the expenses were to be charged to joint account, and at the end of three years, on six months' notice in writing, Campbell had the election, either to turn over the lands intact to Fletcher at cost, plus interest at 12 per cent. per annum, or to consider them as owned jointly by the two men, in which case the capital invested by Campbell was to be repaid, with interest, out of the first sales of the lands. Pursuant to this agreement, about 16,000 acres of pine lands were located in Campbell's name in the counties of Alpena, Montmorency, Alcona, Oscoda, and Presque Isle, in the Thunder Bay region in Northern Michigan. The net amount advanced by Campbell as of August 1, 1856, was $16,050.26.

Campbell died intestate July 15, 1857, leaving as his sole heir at law his father, John Campbell. Campbell's sister, Eliza, had previously married William White, of Boston, Mass. White was state printer of Massachusetts, and a man of considerable standing. He was a prominent Spiritualist, and was the publisher of the Banner of Light, a publication of that sect. By a prior marriage, he was the father of one child, Frances M., who later became the wife of Albert W. Brown. The money which Thomas Campbell invested in the enterprise was probably largely borrowed from his brother-in-law, White, because, as shown by the account of the administrator of Campbell's estate, there was due from the estate to White $17,438.67. The correspondence of the time between the parties shows that White was advancing money to Campbell, and that Fletcher had some knowledge of this fact.

Thomas Campbell and Fletcher had planned and were trying to organize a company for the lumbering of their pine lands and the operation of a sawmill to be located at the mouth of the Thunder Bay Lumber The proposed company was to be called the 'Thunder Bay Lumber Company.' The plans for the organization of this company were interrupted by Thomas Campbell's death. Very soon thereafter White and James Campbell, who was a brother of Thomas Campbell and the administrator of his estate, expressed their desire to carry out the original plans, if possible. The matter was under consideration and discussion for a year or more thereafter. The original plans were never consummated, but certain features of them, as modified by the necessities of the situation, were finally reflected in an arrangement made in 1858 between Fletcher, White, and James Campbell, for the formation of a partnership. Apparently this arrangement enabled the parties to adjust the equities growing out of the dealings between Fletcher and Thomas Campbell, and also the indebtedness of the Thomas Campbell estate to White. One-half of Thomas Campbell's advances (which were a charge against the proceeds of the land, although not against Fletcher personally), with interest to September 1, 1858, amounted to $10,031.41, apparently computed as $10,031.37.

The agreement between Fletcher, White, and James Campbell bore date September 1, 1858, although it was probably executed on January 26, 1859. It is called the 'partnership agreement,' although the existence of a continuing partnership is a disputed question. It adopted the old name 'Thunder Bay Lumber Company.' The partnership agreement covered, not only the pine lands, but also certain 'mouth of the river lands.' Fletcher had acquired in 1855, in his own right, a one-half interest in about 460 acres of land at the mouth of Thunder Bay river, Alpena county, Mich., from one Bailey, which was known as the Bailey purchase, and which covered the most central and valuable portions of what afterwards became the city of Alpena. Its value as a town site was apparently less in the minds of its owners than its value as a site for water power sawmills. At the date of its purchase, it was still largely in its wild condition. Fletcher's co-owners were John Miner and John Oldfield, each of whom owned a one-quarter interest.

This purchase was supplemented in 1857 by the acquisition of the socalled 'Eldred water power fraction,' embracing certain water power and falls in the Thunder Bay river adjoining the Bailey purchase. The lands comprising the Bailey and Eldred purchases are what were known as the 'mouth of the river lands,' and which have been designated on the accounting in this suit the 'city lots.'

The following is the partnership agreement above referred to.

'Articles of agreement, this day made and entered into by and between George N. Fletcher, of St. Clair, Michigan, on the one part, and James Campbell, of Burlington and William White of Boston both in the commonwealth of Massachusetts of the other part, witnesseth: That the said parties mutually agree to form, and do by these presents form, themselves into a company for the purpose of manufacturing lumber at the mouth of Thunder Bay river, in the town of Fremont and state of Michigan, to be called the 'Thunder Bay Lumber Company,' with a capital stock of sixty-six thousand ($66,000) dollars, fully paid in, in manner and from as hereinafter described: One-half or thirty-three thousand ($33,000) dollars by George N. Fletcher, and thirty-three thousand ($33,000) dollars in equal parts by James Campbell and William White, as follows, viz.: By the said Fletcher fifteen thousand dollars, being his portion of fifteen thousand eight hundred and fourteen acres of pine lands now standing in the name of Thomas Campbell in the state of Michigan, and eighteen thousand ($18,000) dollars, being one undivided half of the Bailey and Lockwood and Miner purchases, so-called, of lands at the mouth of Thunder Bay river in said state, and thirty-three thousand ($33,000) dollars by James Campbell and William White, $15,000 in the lands, being the balance of the interest of the late Thomas Campbell in all the lands now standing in his name, situated as aforesaid, and the balance, $18,000, in cash. It is understood and agreed that all profits and losses of the said company shall be mutually and equally divided between the said Fletcher on the one part, and James Campbell and William White on the other part. And it is further agreed for the purpose of building a mill and carrying on the business of manufacturing lumber, that the said parties shall furnish such amount of capital as may be deemed advisable, one-half by the said Fletcher and one-half by the said Campbell and White, and if either party shall at any time furnish more than his proportional amount, then the said company shall pay interest for the same at the rate of 7 per cent. per annum. It is further agreed that the time of either party, when devoted to the special interests of the company, shall be allowed such compensation for his services as may be hereafter agreed upon.

George N. Fletcher. 'William White. 'James Campbell. 'Witness:

'H. W. Harrington.

'Boston, Sept. 1, 1858.'

The effect of this agreement, whether it was performed abandoned, or modified, the nature of the legal relations between its signers during the years which elapsed between its execution and the death of William White on April 20, 1873, and whether White's interest in the 'mouth of the river lands' was a quarter interest or a half interest, are disputed questions. In respect to the...