Reed v. Burton Abstract & Title Co., 61

• Decision Date: 28 December 1955
• Docket Number: No. 61,61
• Citation: 73 N.W.2d 828,344 Mich. 375
• Parties: Harriet Burton REED, Plaintiff and Appellant, v. BURTON ABSTRACT & TITLE COMPANY, a Michigan Corporation; Frank Burton; Edson N. Burton, Executor under the will of Ralph Burton, Deceased; Clarence M. Burton; Ray L. Potter; William B. Giles; Walter A. Kleinert; Robert L. Sauer and John Holmes, Defendants and Appellees.
• Court: Michigan Supreme Court

Page 828

73 N.W.2d 828

344 Mich. 375

Harriet Burton REED, Plaintiff and Appellant, v. BURTON ABSTRACT & TITLE COMPANY, a Michigan Corporation Frank Burton; Edson N. Burton, Executor under the will of Ralph Burton, Deceased; Clarence M. Burton; Ray L. Potter William B. Giles; Walter A. Kleinert; Robert L. Sauer and John Holmes, Defendants and Appellees.

No. 61.

Supreme Court of Michigan.

Dec. 28, 1955.

Nathan E. Shur, Detroit, for appellant.

William B. Giles, Detroit, for appellee Burton Abstract & Title Co.

G. Norman Gilmore, Detroit, for Frank Burton and Edson N. Burton, Executor under Will of Ralph Burton, Deceased.

Walter A. Kleinert, Detroit, for appellees Clarence M. Burton, Ray L. Potter, Robert L. Sauer and John Holmes.

Before the Entire Bench.

SHARPE, Justice.

This is an action for an accounting and an injunction pending final disposition of the cause. Plaintiff, Harriet Burton Reed, is a stockholder of Burton Abstract and Title Company, and is the owner of approximately 10% of its corporate stock. On June 7, 1950, she filed a bill of complaint in the circuit court of Wayne county against the above named defendants in which she charges the defendants with illegal and unlawful withdrawal of corporate funds and conversion of the same. She particularly charges Ralph Burton with having received large sums of money over a period of years in addition to his salary, which sum of mony represent 1% of the net billings of the corporation, and this sum is alleged by plaintiff to have been paid without authorization or approval of the board of directors of defendant company.

The answer of Frank Burton and Ralph Burton shows that on or about June ss, 1941, the following resolution was adopted by the board of directors:

'Moved and supported and carried unanimously that Ralph Burton, Vice-President and Sales Manager of this company, be given in addition to his salary, 1% of the monthly sales of this company, the same being an allowance for sales expenses.'

Defendant company alleges that at the June 19, 1950, meeting of the board of directors of the above company, all of the 1% payment were ratified and confirmed and further payments terminated. This case first appeared on the chancery pre-trial docket on December 19, 1951, and was adjourned to January 30, 1952, then to February 6, 1952, February 13, 1952, February 27, 1952, and then returned to the call. The case appeared on the call March 20, 1952, and was adjourned to the April term, the September term, the November term, and then to the April term, 1953, at which time it was adjourned to October 6, 1953.

On January 15, 1954, the trial court entered an order adjourning the trial date to April 13, 1954. The order contained the following:

'All parties shall be ready for trial on said adjourned date; in the event any party or parties are not ready for trial on said date, said cause shall be dismissed, or default entered, as the case may be.'

On April 10, 1954, plaintiff filed a motion for adjournment of the trial date for cause, giving as her reasons the following:

'1. The medical and physical condition of said plaintiff at the present time is such that a presentation of her case in court in person, by testimony, and a submission to the rigors of cross-examination inherent in the present proceeding and instant cause, would, in considered medical opinion, be an active and serious threat to her life, or result in extremely serious consequences. The disease from which she is suffering and for which she is taking treatment now, is one that has been prevalent in her family, namely high blood pressure and apoplexy resulting therefrom. Three brothers and one sister of plaintiff have met sudden death under strain, from the above cause. This plaintiff believes that present treatment will alleviate this condition.

'Plaintiff has also a history of approximately seven months suffering from acute bursitis, which is still present, and has aggravated the above described high blood pressure. Said bursitis has, in addition to giving plaintiff excruciating pain, temporarily crippled her left arm.

'2. Plaintiff's foregoing condition described, has prevented her from taking any action, or going through any strain of negotiation and talk, necessary to retain trial counsel and acquaint them with the instant cause.'

On April 13, 1954, three affidavits were submitted in support of plaintiff's motion to adjourn the trial. The affidavit of Dr. Albert L. French contained the following:

'Deponent further says that on April 10th, 1954 he examined Mrs. Harriet Burton Reed, in his professional capacity, at 521 Harmon Road, Birmingham, Michigan, and found her condition to be as follows:

'Marked cardio-vascular hypertension with precariously high blood pressure at 210 systolic over 100 diastolic.

'Very painful sub acute bursitis of deltoid muscles of both shoulders with limited use of left arm. Mrs. Reed has been confined to her home and should refrain from all undue physical and mental strain, which would result in a grave prognosis.'

The affidavit of Dr. L. C. M. Conley stated:

'Deponent further says that at this time Mrs. Reed's physical and medical condition is as follows:

'Patient is suffering a bursitis in the both shoulders, aggravating a very high blood pressure--systolic 206 diastolic 98. She should not be called upon to exert herself physically or endure excitement until her pressure has been reduced to a safer level.'

The affidavit of Dr. George P. Raynale stated 'Deponent further states that Mrs. Reed's physical and medical condition at present is as follows:

'Bursitis--(subdeltoid)--Left Shoulder, with a great deal of pain. There is also beginning trouble of the same sort in her right shoulder. This pain is so severe at times that it necessitates lying down. She has been under treatment for this condition the past four months.'

The record shows that all continuances except one were asked for and granted to plaintiff. On April 13, 1954, counsel appeared for all parties, at which time counsel for plaintiff asked for a further continuance. The trial court denied plaintiff's request for further continuance, whereupon plaintiff asked for a nonsuit. The trial court, in denying the motion for continuance and later nonsuit, stated:

'I think the record likewise should show that at no time was the plaintiff ever without counsel. There were two counsel involved at all times, and I can see no reason why these two counsel cannot proceed with the trial. I will grant you the right to take the plaintiff's deposition before you close your proofs, but I think we should proceed now and attempt to take the testimony, in order to dispose of this matter.

'As I indicated before, the defendant corporation is at a distinct disadvantage in having this matter pending, because of its relationship with the Insurance Commission and other state officials. Under the circumstances, I must deny your motion for a continuance and ask the plaintiff to proceed.

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'Well, under the circumstances, I doubt my authority to take a voluntary nonsuit without the consent of counsel for the defendants.

'In this case, the record shows that all continuances, save one, were granted to the plaintiff. The one exception was when counsel for Ralph Burton's estate asked for a continuance to prepare a substitution.

'I think the defendants, being ready to go to trial at all times and now being ready to go to trial, are entitled to a decision upon the merits of the case. Under the circumstances, I will deny your right to enter a voluntary nonsuit and will enter an order of dismissal of the Bill of Complaint with prejudice.'

On April 16, 1954, a decree was entered which contained the following:

'This cause having been assigned to this Court for trial and all previous adjournments save one at the request of the plaintiff having been granted as indicated by this Court on the record, and this Court having on January 15, 1954, entered a certain order granting to plaintiff a further continuance to April 13, 1954, for the purposes and upon the conditions therein set forth, which said order was made and entered upon consent of all attorneys of record; and,

'This case having duly and regularly come on for trial on April 13, 1954, the date specified in the aforesaid order, and for the reasons stated by this Court upon the record,

'Therefore, it is ordered, adjudged and decreed that the above entitled cause be and it is hereby dismissed, with prejudice, and with costs to be taxed in favor of the defendants and against the plaintiff.'

The record also shows that on June 18, 1953, by stipulation and order of the court, defendants William B. Giles and Walter A. Kleinert were dismissed as parties defendant.

Plaintiff's reasons and grounds for appeal are, in part, as follows:

'The court erred in entering a decree of dismissal with prejudice where no testimony on the merits was entered by either party plaintiff or party defendants.

'The court erred in ruling that the affidavits of three reputable physicians provided no just cause for adjournment of trial date.'

This case involves an interpretation of the 1945 Michigan Court Rule No. 38, § 1, which reads as follows:

'The plaintiff may at any time, before answer filed, and on the payment of costs, discontinue his suit be notice of discontinuance filed in the cause and giving notice thereof to the defendant or his attorney. Thereafter he may discontinue, on the same terms, only (1) upon filing a stipulation to that effect signed by the defendant, or his attorney, or (2) or the order of the court or judge made on special motion in which the grounds for such discontinuance shall be set forth and which shall be supported by affidavit. After a recoupment, set-off or cross bill has been pleaded by a...