Yanish v. J. Neils Lumber Company

• Decision Date: 10 May 1907
• Docket Number: 15,238 - (108)
• Citation: 111 N.W. 921,101 Minn. 78
• Parties: EDWARD YANISH and Another v. J. NEILS LUMBER COMPANY
• Court: Minnesota Supreme Court

111 N.W. 921

101 Minn. 78

EDWARD YANISH and Another v. J. NEILS LUMBER COMPANY

Nos. 15,238 - (108)

Supreme Court of Minnesota

May 10, 1907

Action in the district court for Ramsey county to recover $7,913.49 upon an assignment contract. The case was tried before Kelly J., who found in favor of plaintiffs. From a judgment entered pursuant to the findings, defendant appealed. Affirmed.

SYLLABUS

Contract -- Deposit with United States.

Plaintiffs had deposited with the treasury department of the United States a sum of money as security for the performance of a contract given them for cutting certain standing pine timber upon government land. They assigned the contract to defendant, in consideration of which defendant agreed to repay them the amount of such deposit whenever the government should permit the same to be applied in payment for timber cut under the contract. The proper department of the government adopted a rule that money so deposited might be applied annually, in proportion to the amount of timber cut upon procuring the consent of the contractor's surety.

Held (1) That the contract, properly construed, imposed upon defendant the obligation of repayment to plaintiffs so soon as the deposit could, by rule of the government, be resorted to in whole or in part for the purpose stated; and (2) that it was defendant's duty to obtain the consent of the surety to such application.

A. Y. Merrill and R. J. Powell, for appellant.

Walter L. Chapin, for respondents.

OPINION

BROWN, J.

The facts in this case are as follows: Some time prior to October 24, 1904, plaintiffs entered into a contract with the United States under which they acquired the right to cut and remove ninety five per cent. of the pine timber standing upon land owned by the government upon certain specified terms and conditions. As a part of the transaction they were required to and did deposit with the treasury department of the United States the sum of $7,913.49 as security for the faithful performance of the contract. As further security for such performance plaintiffs executed and delivered to the government a bond in the sum of $20,000, with the Title Guaranty & Trust Company, of Scranton, Pennsylvania, as surety. Thereafter, and on the date above mentioned plaintiffs sold, assigned, and transferred all rights acquired and possessed by them under the contract to the defendant, who agreed to carry out and perform the same, and to assume all obligations therein created and imposed. In consideration of the assignment defendant agreed to repay to plaintiffs the amount so deposited by them with the United States as soon (1) as plaintiffs should procure from the government an approval of the assignment, or (2) as soon as the government, through the proper department, should rule that the sum so deposited was applicable to the purchase price of the timber cut under the contract. Until available for that purpose, defendant agreed to pay interest thereon at the rate of six per cent. per annum. As a part of this assignment contract defendant agreed to and did execute and deliver to plaintiffs a bond in the sum of $20,000 for the purpose of indemnifying them from loss for any failure on its part to perform the government contract, and the further purpose of protecting plaintiffs' surety, the Title Guaranty & Trust Company, from similar loss. The approval of the assignment to the defendant was never obtained from the government,...