Howard v. Durand

• Citation: 36 Ga. 346
• Parties: THOMAS C. HOWARD, plaintiff in error. v. SAMUEL A. DURAND, defendant in error.
• Decision Date: 30 June 1867
• Court: Supreme Court of Georgia

36 Ga. 346

THOMAS C. HOWARD, plaintiff in error. v. SAMUEL A. DURAND, defendant in error.

Supreme Court of the State of Georgia

(Milledgeville, June Term, 1867.)

Motion to attach for violating injunction, in Fulton Superior Court. Decided by Judge Warner. April Term, 1867.

This bill was filed by Thomas C. Howard against Frederick A. Williams and John C. McLean, for account and settlement, and against Samuel A. Durand for account, settlement and injunction. The facts as set forth in the bill are substantially as follows:

In March, 1857, or 1858, complainant, John S. Williams, *John H. Lovejoy and H. L. Currier, composed "The Atlanta Spoke Company, " manufacturing spokes and hubs for carriages. They were to furnish equally the necessary capital, and equally share the profits and losses of the business. John S. Williams and Frederick A. Williams were at the same time, partners under the style of F. A. & J. S. Williams, manufacturing furniture, and owned valuable water power near Atlanta.

Before any work was done by "The Atlanta Spoke Company, " Lovejoy sold his interest therein to F. A. Williams, and said Currier sold his to F. A. & J. S. Williams.

Complainant consented to these changes, and he and said Frederick A. and John S. agreed to continue under said first name, they owning one half and complainant the other half, with the privilege to said Spoke Company of using said water poweras long as said Spoke Company desired it, paying F. A. & J. S. Williams for such use, one dollar per day.

The Atlanta Spoke Company thus constituted, bought much machinery, consisting of mortising machines, lathes, pulleys, belts, etc., suitable for said work, and a patent spoke lathe, known as the Burn lathe, with the right to sell said lathe in Alabama, Mississippi, Texas, Louisiana, Georgia and other States.

Said articles cost $12,000, and buildings, etc. to operate the same cost over $2,000, one-half of which sums complainant paid.

Complainant having confidence in said Frederick A. and John S. allowed them the exclusive management of the business, and they so managed it till John S. died. This was some time in 1858. Frederick A. took the interest and rights of John S., as survivor of F. A. & J. S. Williams, and he and John C. McLean, (who had bought one-half of F. A. Williams's interest), and complainant continued the business upon same terms and under same name, till about 1st January, 1861. Said Williams and McLean exclusively managed the business. They sold $5,000 worth of spokes and hubs, the cost of manufacturing them not exceeding two thirds of that amount. They sold several of the Burn lathes, *with the rights and privileges attached thereto, at a profit of $4,000. Complainant is entitled to one-half of said profits.

Their employees went into the army and the work stopped. There was then on the premises finished and unfinished hubs and spokes, worth $6,000 or other large sum, a rim binder invented by E. L. Morton, worth $500. By contract, Morton was to patent this, and the Company had a right to use it as long as it wished. That use is worth $1,000 per year. The said water power was worth to the Company $1,000 per year. All the machinery and work of the Company was on the premises.

In April, 1861, F. A. Williams became, from disease, unable to attend to business. On the 21st August, 1862, Williams and McLean sold one-third interest in all the lands and improvements, with the water power, mills, machinery, engines, lathes, tools, patterns, stock of all kinds on the premises or at the mills, finished and unfinished work in the shops, to Samuel A. Durand, and then and there formed a partnership with him, in the business of manufacturing furniture.

In September, 1862, Durand bought out McLean's interest in this firm, and afterwards bought out Williams's interest therein. Complainant had no notice of the sales.

Although no intention of defrauding complainant in this trade, is charged to Williams and McLean, yet they put Durand into possession of all the property of said Spoke Company, which was in said mills, shops and other houses on said land.

Durand bought with notice of complainant's rights. Com-plainant has offered to furnish one-half of the necessary capital, but Durand denies him any rights in the premises, and is making spokes and hubs on his own account, and getting large profits by contracts for the same.

Complainant has offered to sell out to Durand or buy him out. He has offered to sell the whole and divide with Durand. Durand will do neither, nor will he submit their claims to arbitration.

Machinery being very scarce, this is now worth double the *original cost; it is encumbered by no debt, and with sufficient hands, fifty thousand dollars per annum profits could be realized by making spokes and hubs, so great is the demand for them by the Confederate States and others.

Durand is realizing these profits, and refuses to allow complainant to participate therein, and is wearing out said machinery and consuming said material.

After the other prayers usual to such a bill, is a prayer for injunction against Durand, enjoining him from selling any of the finished or unfinished material and work on hand belonging to said Spoke Company, from running, using, selling or disposing of any of the machinery, mortising machines, pulleys, belts, patterns, rims, lathes, etc., belonging to the said Company, until further order.

The injunction was granted by Judge O. A. Bull, 9th January, 1863. Injunction issued, and Durand was served 16th January, 1863. There was a return of non est inventus as to the other defendants. Durand has not answered the bill.

At April Term, 1866, it was represented to the Court, that Durand had violated said injunction by selling and otherwise disposing of all the finished and unfinished work and materials of said Company, with its machinery, heretofore enumerated.

Thereupon he was ordered to show cause why he should not be committed for contempt.

At that term, Durand, for cause, denied that he had violated said injunction, that he had sold or disposed of any of said property; that he had used, sold or disposed of the machinery, and stated that a short time after the service of said injunction on him, his shops, machinery, water-power, etc., including the machinery mentioned in said rule nisi, was seized and impressed by Major Norman W. Smith, Chief Inspector of Field Transportation, of the Confederate States Government, and was used by him up to a period within a few days of the fall of Atlanta, when said machinery was carried or sent by the agents of the Government, to the city of Augusta for safety and to prevent it fromfalling into the hands of the enemy; and afterwards when Augusta was threatened, it was removed *to Greenville, South Carolina, where it still is, so far as he knows, subject to the decision and decree of the Court.

In September, 1866, Durand, "by way of amendment to his said answer, " further answered, that shortly after service of theinjunction, and after he had stopped his operations in obedience thereto, complainant and he commenced negotiations for a settlement of their said controversy; that he, as he believed, had purchased all of said machinery, etc., from F. A. Williams and McLean, in a trade for their land, water-power and manufacturing establishment, to which the machinery of the Atlanta Spoke Company was attached, without any reservation having been made.

Defendant, in reply to a proposition made by complainant to purchase said machinery, stock, etc., on the 11th February, 1863, wrote as follows:

"Colonel T. C. Howard: —Your proposition to purchase the machinery and stock heretofore belonging to the Atlanta Wheel and Spoke Company and now in my possession, (one-half of which is claimed by you), is hereby accepted; the price is understood to be six thousand dollars, to be paid by you to me and (upon) delivery of the property, said property to be delivered whenever a certain contract for six hundred wheels, which are now being completed, shall be ready for delivery.

"I understand that you are to have the benefit of all the net profits arising from said wheels, which profits are to be deducted from the six thousand dollars you are to pay me for the property.

"I further understand that Captain E. L. Morton is to select out the property sold, and to assist in preparing it for removal from my premises; also that I yield my claim to any hand or hands now in my employ, whom you may wish to employ for any purpose, and work for you myself at just compensation.

"I further understand and hereby agree, that in case of failure on my part to carry out the sale and delivery of the property above-mentioned, I forfeit and pay over to you the sum of ten thousand dollars as fixed and liquidated damages. On the other hand, should you fail or decline taking the machinery, *etc, and tender me the money as above, within ten days after I shall have announced ready to receive it and deliver the property sold, you are to renounce all claim or claims whatever to said property, and yield the same to my benefit.

Samuel A. Durand.

Test. J. T. Lewis.

"If the foregoing recital of our trade is in accordance with your understanding from what Captain Morton verbally communicated to you, then endorse below, the words 'Ratified and agreed to, this 11th February, 1863, in presence of.' Let Captain Morton be the custodian of this paper till the trade is either consummated or abandoned.

S. A. Durand."

Complainant, in presence of said Lewis, wrote on said letter, "Ratified and agreed to, this 11th February, 1863, " and signed the same.

Durand says this agreement settled the injunction to all intents and purposes, and remitted the parties to their respective rights. He urges that this view is proven by the fact that in March, 1866, Howard brought suit against him on said paper, in the Inferior Court of said county, for ten thousand dollars liquidated damages, as appears by exhibited copy of the declaration.

He...