Phillips v. Colfax Co.

• Decision Date: 18 June 1952
• Citation: 195 Or. 285,245 P.2d 898
• Parties: PHILLIPS v. COLFAX CO., Inc.
• Court: Oregon Supreme Court

Page 898

245 P.2d 898

195 Or. 285

PHILLIPS v. COLFAX CO., Inc.

Supreme Court of Oregon.

June 18, 1952.

William L. Josslin, of Portland, for the petition.

Glen McCarty and J. W. Rosacker, of Portland, contra.

Before BRAND, C. J., and LUSK, LATOURETTE, WARNER and TOOZE, Justices.

WARNER, Justice.

The defendant Colfax Company has petitioned for a rehearing.

It is evident therefrom that the defendant misconceives the judicial functions when the court is presented with a motion for nonsuit or directed verdict. Taken by its four corners, the matter in this petition might be appropriately addressed to a jury, for it calls upon this court to appraise the testimony in accordance with defendant's estimate of its relative weight and value. It is also in the nature of an indictment for our failure to do so in the first instance. Indicative of these things, we find the petition replete with phrases reading: 'The Court's holding * * * is not based on adequate or proper evidence * * *'; '* * * uncontradicted written evidence * * * is brushed aside by this Court in favor of flimsy and conflicting oral testimony * * *'; 'The Court disregards plaintiff's own testimony * * '; 'The decision ignores the repeated admissions of plaintiff * * *'; and 'The Court rejects the testimony of Carl and Albert Fossi * * * [and] accepts shifting and conflicting oral testimony unworthy of credence and contrary to established business practices * * *.' But it must be remembered that the matter at bar is an action at law. It is not a suit in equity calling for a trial de novo on appeal with the incident duty to make our own independent appraisal of the relative weight of testimony adduced.

We have frequently and consistently defined the powers and limitations of this court when called upon to review alleged errors predicated upon a trial court's refusal, as here, to grant motions of nonsuit or motions for a directed verdict in law actions. In Fish v. Southern Pacific Co., 173 Or. 294, 301, 143 P.2d 917, 920, 145 P.2d 991, we said:

'* * * In considering the propriety of these rulings, the motions must be regarded as having admitted the truth of plaintiff's evidence, and of every inference of fact that may be drawn from the evidence. The evidence itself must be interpreted in the light most favorable to plaintiff. McCall v. Inter Harbor Nav. Co., 154 Or. 252, 59 P.2d 697. Where the evidence conflicts, the court may not infringe upon the function of the jury by seeking to weigh or evaluate it, but is concerned only with the question of whether or not there was substantial evidence to carry the case to the jury and to support the verdict. Ellenberger v. Fremont Land Co., 165 Or. 375, 107 P.2d 837; Allister v. Knaupp, 168 Or. 630, 126 P.2d 317.'

Also see Smith v. Industrial Hospital Ass'n, Or., 242 P.2d 592, 596; Edvalson v. Swick, 190 Or. 473, 478, 227 P.2d 183; Dudleston v. Chiravollatti, 184 Or. 405, 415, 198 P.2d 858. Such inferences favorable to plaintiff may also be drawn from defendant's as well as plaintiff's evidence. Smith v. Industrial Hospital Ass'n, supra.

We will, however, take notice of some of the petition's unequivocal and over-positive statements that there is no evidence of certain matters referred to in our former opinion.

The petition states: 'There is no evidence that when any of the six loans in suit were negotiated, the corporation owed any money to the partnership or that any such debt equalled the amount of any or all of such loans * * *.' (Italics ours.)

This bold assertion is evidently inspired by the statement in our opinion:

'Recalling as we again do that when the loans were obtained from the plaintiff, the corporation was indebted to Fossi Bros. for construction still in progress, it follows that the relationship of debtor and creditor subsisted between the Colfax Company and the partnership of Fossi Bros. * * *.'

We did not, however, attempt to demonstrate the existence of this debtor-creditor relationship beyond quoting from the testimony of plaintiff's witness Hokanson, repeating statements made by Carl Fossi to plaintiff respecting delayed payments of the corporation's money due to Fossi Bros. under the construction contract. This in and of itself is a substantial item of evidence warranting an inference by the jury that the corporation was then indebted to the partnership and one that cannot be ignored.

For more realistic assurance that the corporation was indebted to the partnership at the time it received the benefit of the Phillips loan, we need look no further than defendant's Exhibits X, Y and Z.

Preliminary to discussing these exhibits of defendant, it may be well to recall that the corporation had earlier entered into a contract with the partnership for the construction of an apartment house on property owned by the corporation. The work had been begun early in 1948. At the time plaintiff made his first advance in October, 1948, the apartment building was then within approximately two months of completion. From the beginning of the construction until its termination sometime in January, 1949, the corporation was continuously in the debt of the partnership. This is confirmed by an examination of defendant's Exhibits X, Y and Z, hereinabove referred to. As a matter of convenience, if not necessity, the corporation arranged for its financing to the extent of $165,500 (inadvertently stated as $165,000 in our former opinion) in the manner and through the agencies referred to in our first opinion. It had given its note in that amount to the Investors Syndicate and secured the same by a mortgage on the apartment property. The funds derived from the loan were disbursed from time to time by the mortgagee to the mortgagor in accordance with a formula approved by the F. H. A. and pursuant to forms supplied by that federal organization. This formula and these forms are reflected by Exhibits X, Y and Z.

It appears therefrom that at certain periods, apparently at the end of each month, the contractor (the partnership of Fossi Bros.) would execute what is denominated as a 'contractor's requisition', addressed to the corporation as owner of the apartment house under construction and requesting payment for work on the apartment house completed during the preceding month. Each requisition, among other things, carried an estimate of the total cost on completion of construction for each major item of the work and the value of the work completed during the period subsequent to the last preceding requisition. These requisitions also disclosed the percentage of the total contract price which had been withheld from previous payments.

Exhibit X is the contractor's requisition for work done in the month of September, 1948, in the amount of $12,541; Exhibit Y is a requisition for the work done in the month of October in the amount of $5,461; and Exhibit Z is a requisition for the work done in the month of November in the amount of $2,141. To each of these exhibits is attached the F. H. A's authorization for the payment of the requested amounts and its certificate of mortgage insurance covering the same. From each approved payment as made, approximately ten per cent was retained to the credit of the contractor. The accumulation of these retained amounts is shown on each requisition. At the time of the making of Exhibit X, dated October 4, 1948, this retained amount was then $15,490; as shown by Exhibit Y, it was $16,097; and as shown by Exhibit Z, at the end of November it was $16,335. These items alone, furnished by and certified to Carl Fossi in his capacity as one of the contracting partnership, are in and of themselves most cogent and persuasive evidence of the existence of a debtor and creditor relationship between the corporation and the partnership at the times that plaintiff made his several advances. In addition thereto, the corporation was in the contractor's debt for the amount requested by each requisition from the last...