Titus v. Whiteside

• Decision Date: 11 January 1916
• Docket Number: 15611.
• Citation: 228 F. 965
• Parties: TITUS v. WHITESIDE et al.
• Court: U.S. District Court — Northern District of California

228 F. 965

TITUS v. WHITESIDE et al.

No. 15611.

United States District Court, N.D. California.

January 11, 1916

Charles A. Shurtleff, of San Francisco, Cal., for plaintiff.

Gillett & Cutler, of San Francisco, Cal., for defendants.

VAN FLEET, District Judge.

The bill seeks to enforce the provisions of a contract entered into December 9, 1905, between plaintiff's testator, W H. Titus, and John McAlpine, testator of defendants, and for an accounting thereunder. In substance, the contract provided that Titus, a resident of Beckwith, Cal., 'a cruiser and examiner of timber and timber lands,' was to examine and purchase timber lands in this state, the title to be taken in the name of McAlpine, a resident of Duluth, Minn., described in the contract as 'a dealer in and handler of timber and timber lands,' and who, the contract contemplated, should advance the necessary funds. McAlpine was to pay to Titus $150 per month, Titus to pay his own expenses, but to have in addition to his salary a one-quarter interest in the net profits resulting from the disposition of the lands to be purchased and the timber thereon, after deducting the purchase price, expenses of acquisition, taxes carrying charges, and interest at 5 per cent. on the moneys advanced by McAlpine, with an option in Titus, in lieu of his interest in the net profits, to receive title to an undivided one-quarter interest in the corpus of the lands and timber at any time he might elect to pay one-quarter of the purchase price, carrying charges, expenses, and interest as aforesaid. The contract provided that McAlpine could terminate it at any time he might see fit, and that thereupon the salary of Titus should cease at the end of the then current month and his services thereunder be at an end. It did not specify or limit the quantity or acreage of land contemplated to be acquired under its provisions. The bill alleges the performance of services by Titus in the acquisition of title to a large acreage of land-- some 34,000 acres-- in pursuance of the terms of the contract, down to the date of his death in October, 1911, and that the provisions of the contract in the acquisition of such lands had been fully kept and performed by him.

The answer admits the making of the contract sued on, but alleges that it 'became annulled and canceled on the 19th day of February, 1908, by an agreement in writing,' which is set out as an exhibit; alleges that Titus' services under the first contract ceased upon the execution of the second denies that Titus 'kept or performed all the conditions or stipulations' of the first contract, or that the lands described in the bill were acquired thereunder, or that Titus at the time of his death had any interest whatsoever therein. The contract set up in the answer purports by express terms to 'take the place of' and cancel the prior contract of December 9, 1905. Its pertinent recitals and provisions are that McAlpine, the party of the first part, 'being the owner of about ten thousand (10,000) acres of lands in townships 21 and 22 north, ranges 13 and 14 east, Plumas and Sierra counties, in the state of California, agrees to give to said second party five per cent. (5%) of the actual amount received when said first party sells the timber on the lands above referred to, and as soon as payment is received by first party, the said second party having no interest whatsoever in the timber or lands referred to and only to receive the five per cent. (5%) when the timber is sold by the party of the first part, providing, however, that the amount received by the first party from the sale of said timber shall amount to more than twenty-five per cent. (25%) net profit over and above the purchase price and all carrying charges thereto added, with interest at the rate of six per cent. (6%), including also taxes and all other necessary expenses, and if sold for less than twenty-five per cent (25%) profit, the five per cent. (5%) above referred to, to be received by second party, shall be reduced accordingly. The said second party has no interest whatsoever of any kind or nature in the lands or timber referred to, said first party being the sole owner in fee simple of the lands and timber referred to above, and to any other lands which the party of the first part may purchase or may have purchased heretofore. The said second party shall have no interest whatsoever in the profits of same, having only purchased same as directed by the party of the first part, and all lands so purchased shall be in the name of the first party. The party of the second part shall receive no salary, only actual expenses in looking at timber and paying other parties for estimating same. ' Then follow some provisions having no relation to present consideration.

By stipulation, the cause was sent to the master, 'to take and report the evidence together with his findings of fact and conclusions of law thereon. ' On the case coming before him, the master determined, with the consent of the parties, that, in view of the issues raised by the pleadings as to whether the contract sued on still subsisted, he should first take the evidence and 'report such matter as would furnish the basis for an interlocutory decree, that is to say, whether the second contract was ever in fact executed; that then, after the court had passed on this report, an accounting could be had, ' if deemed necessary. This course was pursued, and the master has filed such preliminary report, in which he finds that the contract set up in the answer was executed by Titus and supplanted the first, and this finding has given rise to the pending question. The materiality of the exception hereafter considered will be better appreciated by a brief statement of some of the peculiar features of the case as disclosed in the master's report.

The execution by Titus of the alleged second contract was sharply denied by plaintiff, and his purported signature thereto which was unusual in character, was denounced as a forgery; the question of its genuineness affording the basis of a very decided conflict in the evidence, with a number of witnesses familiar with the handwriting of the deceased denying its genuineness, and the two experts examined on the subject being diametrically opposed in their opinions. In addition, there were a number of facts and circumstances appearing in evidence and discussed by the master of a more or less doubtful and discrediting character-- alleged declarations of McAlpine after the date of the second contract at variance with its terms as to Titus' interest in the lands; his actions after the death of Titus, and representations to the latter's widow, with other matters-- tending more or less strongly to disparage the genuineness of the instrument. Not the least potent of these facts in the consideration of the master was the peculiar terms of the second contract and the disparity between its provisions and those of the first as to the compensation or emolument going to Titus, with a want of any sufficient reason appearing to explain why the latter should have been ready to voluntarily forego the rights accruing to him under the first-- rights which, as the master indicates, had...