Jones v. Keen

• Decision Date: 17 June 1874
• Citation: 115 Mass. 170
• Court: United States State Supreme Judicial Court of Massachusetts Supreme Court
• Parties: Henry Jones v. Nathaniel P. Keen & others

115 Mass. 170

Henry Jones v. Nathaniel P. Keen & others

Supreme Court of Massachusetts

June 17, 1874

Argued March 26, 1873. [Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material] [Syllabus Material]

Suffolk. Bill in equity filed May 10, 1871, against Nathaniel P. Keen; Allen Prior; Robert H. Patton and another, copartners; Abiel S. Lewis and others, copartners; Pembroke S. Huckins and another, copartners; J. W. Hathaway; Joshua Baker and others, copartners; Edmund H. Sears; Wadsworth Chandler, Jr; William Bourne; Andrew Sampson and others, copartners C. Thompson and another, copartners; Amos Merritt and others, copartners; Hiram Delano; Nathaniel Delano; Hugh Connor, C. P. Wright; J. D. Geary; Ephraim Walker, Jr.; Thomas White; Miles Sampson; John Henry; John Dobbin; Alexander McLean; Charles Sproule; and Franklin B. Cobb.

The bill alleged that in December, 1869, the defendant Keen commenced to build for himself at Duxbury, in this Commonwealth, a barque, which was at the date of the bill on the stocks unfinished; that the plaintiff had a lien ^[*] on the vessel for materials furnished in her construction; that the defendant Prior claimed to have a mortgage from Keen on the vessel for a large sum, and had notified Keen that he was about to sell the vessel under a power of sale contained in the mortgage; that there were other mortgages on the vessel, held by Patton and another copartners, and by Lewis and others, copartners, and claims for a lien on the vessel made by the other defendants to a large amount for labor and materials furnished in the construction of the vessel; that Keen was insolvent and unable to pay his debts; that the barque constituted the greater part of Keen's property, and would if finished and launched and sold in a judicious manner realize a sum sufficient to pay all the claims for a lien, and a large portion of the mortgages; that a sale of the barque in the time and the manner proposed by Prior would work great damage and waste and cause irreparable injury to the plaintiff and the other persons claiming a lien, and would be an illegal and inequitable interference with their rights.

The bill prayed for a writ of injunction to restrain Prior from selling the barque; that a receiver be appointed to take possession of the vessel, with power to contract debts on the security thereof, to take precedence of other liens and incumbrances thereon, for the purpose of completing and launching the vessel, and with power to make sale of the vessel, and to hold the proceeds subject to the order of the court.

A preliminary hearing was had before Wells, J., who granted the prayer of the bill. A receiver was appointed, the vessel was completed, launched and sold, and the proceeds paid into court. The case was by an order dated May 22, 1871, sent to a master, who was directed "to hear the evidence which may be offered by all parties who make any claim by way of lien or otherwise to the property which is the subject of the above bill of complaint, and to report the same and all the facts bearing upon the validity, amount and priority of said claims or any of them to this court."

By a supplemental order the master was directed to fix and allow to the receiver proper compensation for his care, services, &c.

Lewis and others, the holders of the second mortgage, and Patton and another, the holders of the third and fourth mortgages given by Keen on the vessel, filed answers January 15, 1872, in which they denied the jurisdiction of the court on the ground that the plaintiff had a plain, adequate and complete remedy at law. It did not appear that the other parties consented to the filing of these answers at this time, and they were not filed by leave of court. The other defendants made no objection to the jurisdiction of the court. The master filed his report April 17, 1872. So much of the evidence reported by him as relates to the question whether the holders of the second, third and fourth mortgages had a right to take an objection to the jurisdiction of the court, at the time when they filed their answers, is stated in the opinion of the court.

In regard to the compensation to be allowed the receiver the master reported as follows: "The receiver has charged for his services the sum of $ 1219.90; viz., five per cent. on the gross amount of the proceeds of the sale of the vessel; and included in his disbursements is the sum of $ 300 paid to counsel employed by him in reference to the execution of his official duties. No question was made before me as to the propriety of his employing counsel, or as to the reasonableness of his counsel's bill. But several of the parties claimed that the receiver had charged too much for his own services, and counsel urged that five per cent. on the gross amount of sales was no proper measure of the value of the services rendered. I have great doubt whether the basis upon which the receiver estimates his compensation is sustained by custom, or is a reasonable one. Circumstances might be such that such a rate of compensation would be grossly inadequate. I regret that the evidence on this point is such as to leave me somewhat embarrassed. I am of the opinion that an intelligent, competent, conscientious person is the best judge of the value of his services; and although objecting to the rule the receiver has adopted, I do not think the sum he has charged is unreasonable, and I allow it." The master reported the evidence bearing upon this question at length.

In respect to the claim of the plaintiff the master reported as follows: "I find there is due to him the sum of $ 5260.74, and that he filed a statement of his claim in the clerk's office of the town of Duxbury, April 10, 1871, which statement was duly sworn to. I find that in that statement he claims to be due him, and for which he had a lien, the sum of $ 5655.94. I find, moreover, that at the hearing before me it was proven that the sum of $ 395.20 was the price of certain of the materials furnished by him which Keen used in the construction of other vessels than the one which is the subject of this cause. I find, however, that this fact was not known to the plaintiff when he filed his statement, and that he did not wilfully and knowingly claim in his statement more than was due him. Upon its appearing that said amount did not go into this vessel the plaintiff waived any claim of a lien for the same; and I deduct the same from $ 5655.94, and find the value of the material and labor furnished by him and used in the construction of this vessel to be $ 5260.74. All this is for materials, excepting that it includes charges for hauling said materials to the ship, amounting to $ 26.33, and cash paid for surveying same, $ 11.53. I find, moreover, that the plaintiff contracted with Keen to furnish the said materials and labor for the construction of said vessel; that said sum of $ 5260.74 is the just value of the same; that said materials and labor went into the said vessel and the construction of her, and that no part of said sum of $ 5260.74 had been paid, but was due when said lien statement was filed, and still remains unpaid. I find, moreover, that said statement contained a just and true account of the demand claimed to be due and found by me to be due, with the exception above reported; that in it the plaintiff claimed a lien on said vessel for the amount thereof; that all just credits were given in said account and statement; and that it stated correctly the name of the person with whom the contract therefor was made, the name of the owner of the vessel, and a description of her sufficient for identification."

The master reported the evidence in respect to this claim at length. It was contended that the claim had been paid by notes. On this question the evidence was in substance as follows: Keen was the only witness called by the plaintiff. He testified in chief that he gave notes to the plaintiff for his accommodation, not to be credited on his bill; that he supposed the plaintiff had them still as the plaintiff had never surrendered them to him. The plaintiff was present at the hearing before the master, but did not testify. Three witnesses were called by the other defendants, who testified to various conversations with Keen, and with the plaintiff, and their evidence tended to show admissions on the part of Keen and the plaintiff that the claim had been paid by notes, that one or more of the notes had been paid by Keen, and that nothing was said about the notes being accommodation notes. Neither Keen nor the plaintiff testified in rebuttal.

As to the claim of Andrew Sampson and others, the master reported that he found the sum of $ 1088.84 due them for labor, that they made a contract with Keen to caulk this vessel and a schooner for $ 1262.50; that they had finished their work on both vessels and had not received any payment except that they had credited Keen with pine boards to the amount of $ 2.16.

The master also reported the evidence in regard to this claim as follows: Sampson testified: "I have charged 336 1/2 days' work for the whole contract, of which 292 1/2 are on the ship. I get at this by a fair division of the tonnage. I kept account on each until they got so mixed that I couldn't keep it correct for each separately. I know the number of days for both is correct. The schooner's tonnage was about 120 tons, old measure. I think I had the two jobs together, and so I shifted from one to the other back and forth. The schooner was a very unprofitable vessel. I divided on the tonnage and also for the last reason. Mine is a fair estimate. I have been a caulker for thirty years. I have caulked twenty or twenty-five vessels under contract; have worked on five hundred. I...