Wilson v. Pauly

• Decision Date: 13 January 1896
• Docket Number: 300.
• Parties: WILSON v. PAULY.
• Court: U.S. Court of Appeals — Sixth Circuit

72 F. 129

WILSON v. PAULY.

No. 300.

United States Court of Appeals, Sixth Circuit.

January 13, 1896

This was an action at law, brought in the court below by Frederick N. Pauly, defendant in error, as receiver of the California National Bank of San Diego, against William H. Wilson and Annie E. Wilson, upon four promissory notes, for the sum, in all, of $22,575, executed by them at San Diego, Cal., to the above-named bank on the 24th day of March, 1891, and payable in six months after that date. During the progress of the suit William H. Wilson died, leaving a will, and Annie E Wilson was appointed executrix thereof, and the suit was thereupon revived against her as such.

Separate answers were filed in her behalf, personally, and as executrix. As executrix she pleaded: (1) That the notes sued on were executed as the price of the one-third interest in the Rose Canyon brickyard and kiln, situated at San Diego Cal., of which one C. H. Hill claimed to be lessee from one A. G. Gasson, containing eighty acres, and the one-third interest in certain patents on kilns for burning brick, and the plant and personal property situated on said leased premises at the time (except brick which had been burned and finished), with the stipulation that the said Hill, J. W Collins, and W. H. Wilson should enter into a coequal partnership for the manufacture and sale of brick at said yard and kiln. (2) That said Collins had for a long time been president of said California National Bank, of San Diego Cal., and theretofore been associated with the said Hill in operating said yard and kiln, in the manufacture of brick at said yard and kiln for sale, upon an agreement to divide the profits of said business, and said Hill and Collins were partners in said business. (3) That said Collins had agreed with said Hill for carrying on said business, to furnish the capital necessary, which he did by discounting the notes of said Hill in said bank, secured by the pledge of said patents, and there was, at the time of said agreement, an indebtedness existing against the said Hill to said bank, secured as aforesaid, to the amount of about $32,000. (4) That said Hill and Collins falsely and fraudulently represented to said Wilson, in making said agreement of purchase and partnership, that large profits had been made by them in the sale and manufacture of brick at said yard and kiln, and falsely and fraudulently represented that they had already unfilled orders for 6,400,000 bricks for the erection of a college building at or near San Diego, about 250,000 or 300,000 to be pressed, and the remainder common brick, the latter at $11 per 1,000, and the former at $35 per 1,000, and also orders from other sources, making, altogether, enough to run the yard for about 12 months, assuming the annual product would be 10,000,000 bricks,-- all of which said representations, so made, were false and untrue, and so known to be by said Hill and Collins when so made. (5) That said notes were, at the request of said Collins, then the president of said bank, made payable to said bank, to be used in the payment of so much of the indebtedness of the said Hill to said bank, already existing and owing by him, and so much of the said debt of the said Hill was satisfied to the said bank, which was the only consideration moving from said bank for the execution of the said notes to it. (6) That during all the time while these transactions were going on, said Collins was the president of said bank, and that said bank had full notice and knowledge of the said contracts, and of the false and fraudulent representations of said Collins and Hill in the procurement of the execution of said notes, and is bound thereby. (7) That, not only were all of said false and fraudulent statements, stated in said representations, made to said W. H. Wilson by the said Collins and Hill, but were so made by them for the purpose of inducing him to believe and rely upon the, and that he did rely on said statements in making said contract for the said interest in said yard and kiln, and also in the execution of the said notes, and each of them. That said interest in said property was and is valueless, and she prays that said contract may be vacated and held for naught.

To this the plaintiff replied, denying the principal matters set up as a defense by the plea. In her personal defense Mrs. Wilson pleaded similar matters of defense, and for a further defense she alleged that, at the time of the signing by her of the notes sued on, she was a married woman, the wife of the said William H. Wilson, and that she did not receive any part of the consideration for which said notes were executed; that they were given in the execution of a copartnership agreement in which her husband, William H. Wilson, C. H. Hill, and J. W. Collins were concerned, and were employed by William H. Wilson in the purchase of an interest in a brickyard and appurtenances, to be used for the purpose of carrying on the business of manufacturing brick, as stated in her answer as executrix.

The case was tried before a jury. At the conclusion of the evidence, counsel for the plaintiff moved the court to instruct the jury to find a verdict in his favor for the amount of the notes sued on, with interest, against the defendant as executrix and against her personally. The court instructed the jury to find a verdict in favor of the defendant personally, and against her as executrix. The record states that the defendant, as executrix, 'objected and excepted' to such instruction. The jury returned the verdict, directed, and assessed the damages at $27,044.84. Judgment was entered accordingly, and Mrs. Wilson, as executrix, brings the case here on writ of error.

J. O'Hara, for plaintiff in error.

D. W. Fairleigh and George W. Jolly, for defendant in error.

Before TAFT and LURTON, Circuit Judges, and SEVERENS, District Judge.

SEVERENS District Judge (after stating the facts).

Substantially the merits of the controversy on this writ of error are involved in the direction given by the court to the jury upon the trial to return a verdict against the plaintiff in error as executrix. But a preliminary question is raised by counsel for the defendant in error upon the sufficiency of the mode of saving the exception claimed to have been taken to the direction complained of; and it is urged that, in fact, no valid exception is exhibited by the record, and that, therefore, this court is not empowered to review the action of the circuit court in giving such direction. The bill of exceptions states that, at the close of the testimony, the plaintiff moved the court to instruct the jury to render a verdict against the defendant in her personal, as well as in her representative, character; that the defendant objected thereto; and that the court denied the motion as to the defendant personally, but sustained it against her as executrix. It then states that 'the jury returned into court their verdict herein, and the court thereupon rendered the judgment set out heretofore in this record. ' But the bill states no exception to the action of the court in sustaining the plaintiff's motion for directions to the jury. However, the record proper shows that the above-mentioned motion of the plaintiff was filed, stating it in terms. It shows further, that the court took it under advisement until the following day, and then, 'being fully advised,' sustained it so far as it prayed for peremptory instructions against the defendant as executrix and denied it as against her personally; that the defendant objected to that portion of the order sustaining the motion; that the court thereupon instructed the jury, in accordance with the order thus settled, to find a verdict for the defendant personally, and against her as executrix, 'to which instruction the defendant, Annie E. Wilson, executrix, objected and excepted.'

It thus appears that, contrary to the usual course, all these proceedings in reference to the plaintiff's motion for positive instructions to the jury, the action of the court thereon, and the objection and exception of the defendant were made matter of record by entry upon the journal of the court. The position of the defendant in error is that it is indispensable that the exception should appear by the bill of exceptions, and that it cannot be shown by anything else. Numerous cases are cited in support of this proposition from the decisions of the supreme court of the United States and elsewhere. But those decisions were made in cases where the exceptions relied upon were shown by the transcript to have rested in the clerk's or judge's minutes, which had never become any part of the record. They were private memoranda, made at the moment, as a help to the recollection in future action, when it might become necessary to put the...