Petrie v. Torrent
| Decision Date | 16 October 1891 |
| Citation | 49 N.W. 1076,88 Mich. 43 |
| Court | Michigan Supreme Court |
| Parties | PETRIE v. TORRENT. |
Appeal from circuit court, Muskegon county, in chancery; ALBERT DICKERMAN, Judge.
Bill for an accounting filed by Albert H. Petrie against John Torrent. Decree for complainant. Defendant appeals. Affirmed.
Smith, Nims, Hoyt & Erwin, (Benton Hanchett, of counsel,) for appellant.
Bunker & Carpenter, (Blair, Kingsley & Kleinhans, of counsel,) for appellee.
This bill is filed for an accounting. The complainant has for many years been engaged in the general lumber business in this state. He resides at Muskegon. The defendant also resides at Muskegon, and is a lumberman. The bill sets out substantially that the firm of Hannah, Lay & Co., a copartnership of Traverse City, this state, prior to September 23, 1885, were owners of large tracts of pine timber lands, situate in the counties of Grand Traverse and Kalkaska, this state, and saw-mills situate at Traverse City and on Long lake, in Grand Traverse county, and of lumbering outfits. That about the 3d day of December, 1885, complainant opened negotiations with Mr. Hannah, of the firm of Hannah Lay & Co., for the option to purchase said timber lands saw-mills, and lumbering outfit, and on that date entered into an agreement with said firm by which they agreed to give him the first chance of purchasing said properties, or to find a purchaser therefor in the following spring, or as soon as Mr. Hannah returned from Europe, at the price of $2 per thousand feet, with the right to the complainant, or whoever he might interest in the matter, to send men upon the lands to estimate the quantity and ascertain the quality of the timber thereon, in order to determine whether to make the purchase of the said properties, and that on Mr. Hannah's return from Europe the following spring the firm would sell to the complainant, or to any person he might find, for the above-stated price, said timber, and also the saw-mills and the lumbering outfit. That, lacking adequate capital to make the purchase of said properties, complainant set about finding a purchaser therefor, and to that end entered into negotiations with the defendant to induce him to become a purchaser, advising him of the negotiations he had with the firm of Hannah, Lay & Co. That on March 10, 1886, he had a conversation with the defendant relative to the purchase of said lands and sawmills and lumbering outfit, in which conversation it was arranged and understood between him and defendant that said defendant should and would furnish the capital necessary to purchase such lands, saw-mills, and lumbering outfit, provided, on further investigation, it should turn out to be a desirable investment; and that it was further arranged, understood, and agreed by and between them that, in order to make said investigation in accordance with the arrangement made with Hannah, Lay & Co., each should select a man to go over and upon said lands to estimate the quantity and ascertain the quality of the timber thereon, to enable the defendant to determine whether he would purchase the same in accordance with complainant's agreement with Hannah, Lay & Co.; and, in case no purchase should be made by the defendant, each of the parties to pay the expense incurred by him in employing said men in estimating the timber; and, on the other hand, in case a purchase should be made under such agreement, defendant should pay to complainant for his services in looking up said tracts of land, saw-mills, and lumbering outfit, in securing the said first chance to purchase the same, and in giving to defendant the sole opportunity to purchase the same, and for all complainant's services in connection therewith, one-third of the net profits which should be realized from such purchase; and that the defendant on that date, to-wit, March 10, 1886, then and there promised and agreed, to and with the complainant, for the consideration aforesaid, to pay to the complainant one-third of the net profits which should be realized from the purchase of said lands, saw-mills, and lumbering outfits, on the sale or other disposition of said properties. The bill further charges that about the 7th day of April, 1886, in pursuance of this arrangement, each employed a man to go upon and over the lands for the purpose of estimating the quantity and ascertaining the quality of the timber thereon. That the men completed their work July 4, 1886, and made their report to the complainant and defendant two days thereafter, and that complainant expended therein about the sum of $1,000. That while the men were so engaged the parties were informed by Hannah, Lay & Co. that the stumpage price of the timber would be $3 per thousand feet, and that the complainant was laboring under a mistake in supposing the purchase price was $2. That, in pursuance of this communication, he had a conversation with the defendant, in which it was arranged and agreed that, notwithstanding this modification of the purchase price, the men so employed should complete their work, and that the defendant would make the purchase at the increased price, and to pay to the complainant one-third of the net profits which should be realized out of the purchase. That from and after the 23d of September, 1885, and up to the time of the purchase by the defendant, complainant faithfully devoted his time, skill, and energy in securing to the defendant the said properties. That he conducted all the negotiations with Hannah. Lay & Co. relative to the purchase, visited Traverse City frequently to confer with that firm, and when the option had about expired procured an extension, and when the option so extended had elapsed he procured its restoration for a sufficient length of time to enable the defendant to perfect his arrangements to raise the necessary funds to make the first payment. That on or about the 15th day of October, 1886, when defendant was wavering with reference to making said investment, and had virtually abandoned the hope of making said purchase, he suggested to the defendant, and secured from Hannah, Lay & Co., a modification of the terms and conditions of the purchase, and a further extension of time, by which defendant was enabled to raise the funds for a cash payment on said purchase. That about November 7, 1886, in pursuance of said arrangements, and in performance thereof, the defendant purchased said land, saw-mills, and lumbering outfit, and received proper deeds of conveyance therefor. That said defendant paid for said lands, saw-mills, and lumbering outfit the sum of $769,000, of which amount $500,000 was paid in cash, and the balance secured by mortgage on part of the property conveyed. That for along time prior to the purchase complainant had been actively engaged, both independently and in connection with defendant, in looking up purchasers for portions of said lands and parts of said property from defendant, in event of his purchase from Hannah, Lay & Co., in order to enable the defendant to make the purchase. That after the purchase he continued his efforts to make further sales for the defendant until the entire property had been disposed of, except that portion covered by defendant's contract with the Smith Lumbering Company. That prior to July 1, 1887, the
defendant, with his advice and assistance, had sold all of said lands, sawmills, and lumbering outfit in the county of Grand Traverse, and portions of the lands in the county of Kalkaska, to various persons, firms, and corporations, for the aggregate sum of $778,000 and upwards which said sum the defendant had received in cash or commercial paper, or securities equally good as cash, and that all of such commercial paper and securities have at this time been converted into cash; and that after making said sales there remained to the defendant a part of said lands situated in the county of Kalkaska, upon which there is upwards of 60,000,000 feet of valuable pine timber, well worth the sum of $300,000 and upwards, which pine timber and lands represent the net profits realized on said purchase. The bill further charges that on or about December 15, 1886, defendant entered into a written contract with the Smith Lumber Company of Kalkaska, Mich., by which it was to cut, log, and manufacture into lumber the timber from the last-named lands, and sell the lumber so manufactured by it, and turn over to the defendant one-half the gross receipts therefor. That the complainant was consulted by the defendant with reference to making this contract, and with reference to the terms and conditions thereof, and counseled, advised, and aided defendant in all things pertaining thereto. That the said Smith Lumber Company, shortly after making the contract, entered upon the work of cutting the said timber, and manufacturing the same into lumber at Kalkaska, and have since continually been and are still engaged in cutting, logging, manufacturing, and selling the same, and have turned over one-half the proceeds of said sales to the defendant. That said defendant has received large sums of money from the proceeds of said sales which he has appropriated to his own use. That the defendant received monthly, as his share of the proceeds of said sales, in accordance with said contract, from twelve to fifteen thousand dollars, and that he has already received, as proceeds from said sales under the contract, upwards of $150,000, which he has appropriated and applied to his own use. That the moneys so received by the defendant are a portion of the net profits which have been realized on said purchase and sale of said properties, and that the balance of said net profits is represented by the said lands, and the timber thereon, which is upwards of 30,000,000 of feet, and is worth the sum of...
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