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VIGILANTE v. OLD SOUTH TRUST CO.

(Supreme Judicial Court of Massachusetts. Suffolk. Feb. 26, 1925.)

1. Reference 88-Auditor's report, setting out facts and law, held improper.

Where auditor's findings of fact were to be final, his course in reporting that statement of facts material to issues would be found in opinion, and then proceeding to discuss facts and law, and ending in finding for plaintiff, was improper.

2. Banks and banking 631⁄2-Assets of bank or trust company not to be depleted when in hands of banking commissioner.

When banking commissioner takes possession of bank or trust company, under G. L. c. 167, §§ 22-35, he takes its property and business and nothing is permitted to deplete its assets while in his hands.

3. Banks and banking 632-Banking commissioner alone can subject credit of bank in his hands.

Credit of bank or trust company is taken by banking commissioner when he takes possession of bank, under G. L. c. 167, §§ 22-35, and he alone can subject it to obligation.

4. Banks and banking 317-Banking commissioner held, under facts, not to have authorized employment of plaintiff to work for trust company.

Facts held not to show that banking commissioner, in charge of trust company, authorized its president to employ plaintiff to work for it during attempted reorganization. 5. Banks and banking 317-Banking commissioner cannot burden assets of trust company in his hands, with obligation incurred to resume business.

Banking commissioner cannot burden assets of trust company in his hands, under G. L. c. 167, §§ 22-35, with obligations incurred for purpose of resuming business.

6. Banks and banking 317-Pending permission to resume, neither officers nor bank could subject its assets to obligation of contract of employment.

Where banking commissioner took over trust company, under G. L. c. 167, §§ 22-35, its officers had no power to act so as to bind it, and there was no credit which they or it could subject to obligation to one employed by its president to induce depositors to allow part of deposits to remain in bank and take new cap

ital stock.

7. Appeal and error 1175(7)-Judgment to be entered on finding of judge on report of auditor where clearly right.

Under G. L. c. 231, § 124, where the finding of the judge and his orders and rulings of law on the report were clearly right, judgment must be entered on the finding on overruling exceptions thereto.

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WAIT, J. [1] The procedure in this case is peculiar. In the superior court a rule issued to an auditor whose findings of fact were to be final. The auditor, instead of filing a report setting out simply the facts which he found to be true, reported that "a statement of the facts material to the issues of the case will be found in the opinion," and proceeded with a discussion of facts and law ending in a finding for the plaintiff. Such a course was improper.

On the filing of the report, the plaintiff moved that "judgment be entered in his favor on the auditor's report," and the defendant moved that "a 'finding' be entered for the defendant on the facts as found by the auditor, and that the remainder of the report as filed be rejected as surplusage." Both parties sought a final determination of the case at the hearing on these motions. The judge denied the plaintiff's motion, allowed the defendant's motion, and made a finding for the defendant. The plaintiff excepts to the finding, the conclusion of fact, the rulings of law, the conclusion of law, the denial of the plaintiff's motion, the allowance of the defendant's motion, and all the rulings involved.

Only questions of law are brought before us by the exceptions. The findings of fact made by the auditor are final. They were so treated by the judge. The facts are, in substance: That, upon some date not stated, the bank commissioner took possession of the property and business of the defendant, the Old South Trust Company, under the statutes now embodied in G. L. c. 167, §§ 22-35, and, pending the possession and before a determination whether the trust company should be allowed to resume the prosecution of its business, required as a condition of such assumption that the president of the company or the company (the report does not definitely state which) should induce the depositors to allow one-half the total deposits to remain in the bank and take new capital stock in the company; that the plaintiff, who was assistant treasurer of the defendant up to the time when the bank was closed, was employed by the president to aid

in bringing about a compliance with this condition by visiting and soliciting the depositors; that he was engaged in this work from January to June, 1920, rendered serv ice of value, and is fairly entitled to $564 as Exceptions from Superior Court, Suffolk compensation; that from time to time he County; S. E. Qua, Judge.

asked for payment, but was told that funds

(146 N.E.)

were not available and that he would be paid upon the reopening. Though supporting facts are not set out, the auditor may be taken to find authority to hire in the president, and ratification by the company. The auditor finds that only "the major functions" of the bank were suspended; but he does not set out what, if any, of its functions the bank was, in fact, permitted to perform. No liquidating agent was appointed. The bank did reopen and the plaintiff was not paid.

[2] The Legislature has laid down in the statutes, now G. L. c. 167, §§ 22 to 35, inclusive, and acts in amendment thereof, a comprehensive course of procedure where, for any of the reasons set out in section 22, the bank commissioner intervenes in the conduct of the business of a bank or trust company. Commonwealth v. Commissioner of Banks, 240 Mass. 244, 133 N. E. 625; Cosmopolitan Trust Co. v. S. Agoos Tanning Co., 245 Mass. 69, 139 N. E. 806; Cosmopolitan Trust Co. v. Suffolk Knitting Mills, 247 Mass. 530, 143 N. E. 138. If he decides to take possession he takes "the property and business of such bank." G. L. c. 167, § 22. This includes possession of the franchise. "The bald existence of the corporation remains, but all its other substantial rights and privileges are in suspension." Greenfield Savings Bank v. Commonwealth, 211 Mass. 207, 209, 97 N. E. 927, 928. Thereupon the power of the corporation to transact business ceases. The statutes authorize it, with the written consent of the commissioner, to vote to dissolve and liquidate; but it can do business again only if the commissioner permits it to resume. G. L. c. 167, §§ 22, 33. The commissioner may use the corporate powers for purposes of litigation, but no one else can exercise them until such time as he may permit the corporation to resume. In the meantime not only is the corporation powerless to act, but "no bank, trust company, association or individual, * shall have a lien or charge for any payment, advance or clearance thereafter made, or liability thereafter incurred, against any of the assets of the bank of whose property and business the commissioner shall have taken possession.

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*" G. L. c. 167, § 23. This language does not apply to the plaintiff, but it indicates a policy that nothing shall be permit

ted to deplete the assets held by the commismissioner.

were not available and he would be paid after the defendant resumed the transaction of its business. Such testimony negatives any inference that the commissioner authorized what was done. It may well be doubted whether the statutes permit the commissioner to give such authority. While "the property and business" of a bank are in his possession, he holds them only for the purposes contemplated by the statutes-their preservation against further loss, and their distribution among creditors, depositors and stockholders. He cannot burden them with obligations incurred for purposes of resumption of business. Great abuse might result if he were allowed so to do; and even greater abuse if the corporation without his consent or knowledge could incur new liabilities.

[6] These considerations dispose of this case. Pending the permission to resume, the officers of the defendant had no power to act so as to bind the corporation; and there was no credit of the corporation which they or it could subject to the obligation which the plaintiff seeks to assert.

[7] The finding of the judge upon the report of the auditor, his orders, and his rulings of law were right. The exceptions are overruled, and under G. L. c. 231, § 124, judgment is to be entered upon the finding for the defendant. So ordered.

TILLSON v. CRANEBROOK CO. (Supreme Judicial Court of Massachusetts. Plymouth. Feb. 25, 1925.)

Waters and water courses 114 - Evidence held not to show willful or malicious injury by not retaining water in great pond.

Evidence held not to show defendant's willful or malicious injury to plaintiff by not retaining water in great pond by its flashboards, or that defendant had prevision of frost which injured plaintiff's cranberry vines, because water could not be pumped thereon from pond by plaintiff.

Exceptions from Superior Court, Plymouth County; T. T. Broadhurst, Judge.

Action of tort by Wilfred A. Tillson against the Cranebrook Company to recover damages for alleged malicious and willful lowering of a great pond, thereby preventing plaintiff from pumping water to protect cranberry vines. Verdict for plaintiff, and defendant excepts. Exceptions sustained.

M. Collingwood, of Boston, for plaintiff. G. W. Stetson, of Middleboro, for defendant.

[3-5] The credit of the corporation is one of the things taken by the commissioner. No one but him can subject it to an obligation. There is no finding of fact that the bank commissioner authorized the defendant to employ the plaintiff and to promise payment from its assets. The only reasonable inference is to the contrary. The plaintiff RUGG, C. J. This is an action of tort to testified that he was told that the assets recover damages for the malicious and willFor other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes

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Its level was 45 inches below the bench
At that level the plaintiff was un-

ful lowering of Sampson's pond, a great pond | hood. in the town of Carver, whereby the plaintiff | mark. was prevented to his great loss from exercis- able to pump water on his bog with his aping his privilege of pumping water therefrom pliances. There was no evidence as to the to protect his cranberry vines. The evidence natural level of the pond or of its low-watended to show these facts: The plaintiff ter mark. The only evidence as to the dewas the owner of a cranberry bog near Samp- fendant's connection with the actual level son's pond. Water in sufficient quantity to of the pond in 1915 was that its treasurer flow the bog was essential to protect the testified that he visited the outlet of Sampvines from frost and consequent damage to son's pond in May, 1915, and most of the the crop. The plaintiff had been granted a flashboards were out; that the water was license by the board of harbor and land com- running out of the pond; that about May missioners "to excavate a channel and lay a 25 or 26 he put in the flashboards; that the wooden flume below the natural high-water directors or other officers of the defendant mark in Sampson's pond * for the had never discussed the subject of the purpose of drawing water to flow his cran- plaintiff's taking water from the pond. One berry bog, the bottom of said flume Sullivan testified that the president of the to be 4 feet wide and 4 feet below the level of defendant, some time in 1914, while near the high water in said pond as shown by a bench appliances of the plaintiff, said to him, "You mark. One of the conditions of can't get no water out of here." That was the license was that the "waters of said pond all the conversation. It did not appear that shall not be lowered except for necessary Sullivan had any connection with the plainand reasonable use in flowing the cranberry tiff. On or about May 5, 1915, the plaintiff, bog, * and in no event drawn lower finding that the water was going down, withthan 4 feet below the level of the bench out being held by flashboards, caused a letmark." The plaintiff constructed appliances ter to be written by his attorney to the deadapted for pumping water from the pond so as to flow his cranberry bog, the intake for fendant calling its attention to the fact that the water being 45 inches below the level of the water was becoming so low that he was the bench mark. Water sufficient to flow the unable to get sufficient water to flow his bog. bog to a depth of 12 inches would lower the On May 29 the plaintiff was unable to operate level of water in the pond one-half inch. At his pump because the water in Sampson's the outlet of the pond there is and has been pond was so low, whereby his cranberries since before 1850 a dam, at the time of the were greatly injured by a frost on that and plaintiff's injury under the control of the the following nights. defendant, with a flume and flashboards, whereby the level of the pond could be raised or lowered. A few rods below this dam the defendant owned and maintained a mill equipped with flume and flashboards. Be tween these two dams was a little pond capable of being raised to the level of Sampson's pond, so that its level might be controlled by flashboards at the mill. In the spring of 1915 the water was as low in Sampson's pond as. it ever had been seen before, according to old residents and observers in the neighbor

This statement demonstrates, without further argument, that there was no evidence of willful or malicious injury to the plaintiff by the defendant. There is nothing to show the circumstances or the reasons of the flashboards being off the dam, or that the defendant took them off, or that the defendant had any malice or ill will toward the plaintiff or purpose to injure him, or that it had any prevision of a frost on May 29 and 30, 1915. It is unnecessary to consider other questions. Exceptions sustained.

(146 N.E.)

SAVIN v. BUTLER. (No. 18422.)

offense through which the property was lost concededly was a robbery, for neither at the common law nor by statute could a bur

(Supreme Court of Ohio. Dec. 23, 1924. Re- glary grow out of a transaction occurring

hearing Denied March 17, 1925.)

(Syllabus by the Court.) Pledges 28-Pledgee relieved from liability for loss from certain causes, held liable for loss through any other cause.

Where a pledgee accepts personal property as security for a loan and enters into a written contract with the pledgor, one clause of the contract stating that the pledgee is "not to be held accountable for fire or burglary," and the property has become lost to him and to the pledgor by reason of a transaction which is

neither a fire nor a burglary, the pledgee must respond to the pledgor for the value of the property.

at 10 o'clock in the morning.

It is unnecessary, therefore, to determine whether Savin is bound by the rules applying to pawnbrokers, whether he is bound by the rules relating to warehousemen, or whether he is bound by the rules governing an unclassifiable bailee for hire. Whatever may have been his status, he made a contract under which he was obligated to return the goods or be responsible for the value thereof, save only in case of fire or of burglary. Thus pro tanto he became an insurer.

As there is no dispute regarding the ultimate facts, the question becomes one of law. Since Savin accepted the property with an

Error to Court of Appeals, Hamilton obligation on his part (other than as specified County.

Action by Joseph S. Butler against Samuel Savin. Judgment for plaintiff was affirmed by the Court of Appeals, and defendant brings error. Affirmed.-[By Editorial Staff.] This case comes from Hamilton county. In the superior court Joseph S. Butler was plaintiff, and Samuel Savin, a pawnbroker, doing business in Cincinnati, was defendant. Plaintiff claimed a recovery growing out of a contract of pledge made with defendant. The defendant admitted having received the article in question, a gold diamond ring, as a pledge.

in the two exceptions) to return it, and has not exculpated himself, he is bound as a matter of law to respond in damages.

The superior court reached the right destination, although it proceeded by a circui. tous route so to do. The Court of Appeals on the record affirmed the judgment, which action is hereby approved. Judgment affirmed.

MARSHALL, C. J., and MATTHIAS and ALLEN, JJ., concur.

(two cases).

The issue was submitted to a jury, which SULLIVAN v. MANHATTAN MARKET CO. returned a verdict for plaintiff, on which judgment was entered, and, on error to the Court of Appeals, the judgment was affirmed. The case by this court was ordered certified here.

Pogue, Hoffheimer & Pogue, of Cincinnati, for plaintiff in error.

Knight & Phares, of Cincinnati, for defendant in error.

CONN, J. The questions argued on briefs and orally grew out of claimed errors in the charge with respect to the burden of proof, and also claimed errors in the admission of evidence.

In the view we take of the case the alleged errors become unimportant, because they could not have been prejudicial, and will not be considered.

The action was founded on contract. In the written agreement between the parties there is this provision: "Sam. Savin not to be held accountable in case of fire or burglary.”

The contract in question grew out of the pledging by plaintiff below of a ring to defendant, Savin, to secure a loan. The facts indisputably show that the property was not lost through fire or because of burglary. The

(Supreme Judicial Court of Massachusetts. Suffolk. Feb. 26, 1925.)

1. Appeal and error 1078 (4)—Exception to admission of evidence, not argued, is waived. Exception to admission of evidence, not having been argued, is waived.

2. Food 25-Negligence in making pie containing body of mouse held for jury.

Whether plaintiffs suffered ptomaine poisoning by eating pie manufactured by defendant company, which contained body of mouse, and whether reasonable inspection in exercise of reasonable care would have disclosed such foreign substance in the filling, held, under evidence, questions for jury.

3. Food 25-Manufacturer of part of pie held responsible for finished product.

Manufacturer of pie, which made its own crust, but bought filling, held responsible for finished product, alleged by plaintiffs to have contained deleterious and poisonous matter.

Exceptions from Superior Court, Suffolk County; F. Lawton, Judge.

Separate actions of tort by James Sullivan and by Mary Sullivan against the Manhattan Market Company, to recover for alleged negligence of defendant in preparation of food

For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes 146 N.E.-43

for human consumption. Verdicts were di-
rected for defendant, and plaintiffs except.
Exceptions sustained.

B. J. Killion, of Boston, for plaintiffs.
J. H. Morson, of Boston, for defendant.

SANDERSON, J. [1] These are two actions of tort to recover damages for injuries alleged to have been caused by the eating of food maufactured and sold by the defendant which, through the negligence of the defendant, its servants, agents, and employees, was suffered and permitted to contain deleterious and poisonous matter. The answer is a general denial. At the close of the evidence the court, subject to the plaintiff's exception in each case, directed the jury to return a verdict for the defendant. These exceptions present the only question for our consideration. The plaintiffs' exception to the admission of evidence not having been argued is treated as waived.

of the serious consequences to human life likely to follow his negligence. Newhall v. Ward Baking Co., 240 Mass. 434, 134 N. E. 625; Tonsman v. Greenglass, 248 Mass. 275, 142 N. E. 756. "The sale of food dangerous to health and to life renders the manufacturer or the seller thereof liable to third persons not the direct purchasers for injuries received by them from its consumption, if the manufacturer or seller was negligent in its preparation or output." Richenbacher v. California Packing Corp., 250 Mass., 145 N. E. 281. The case should have been submitted to the jury.

Exceptions sustained.

CUNEO et al. v. SMITH et al. (Supreme Judicial Court of Massachusetts. Suffolk. March 2, 1925.)

Livery stable and garage keepers 8(1)— Conditional vendor of automobile held entitled thereto as against lien for repairs made after default.

[2] The plaintiffs, husband and wife, boarded with Delia Killeen who, through her agent, purchased of the defendant a raisin pie and served portions of it to the plaintiffs. Mary Under G. L. c. 255, § 35, where condiSullivan ate the piece which was served tional vendee of automobile, at time of delivto her. James Sullivan was eating his por-ering it to garage for repairs, was in default in payment due vendor, conditional vendor was tion when he discovered in it the body of a entitled to property as against lien for remouse. Both plaintiffs were made ill. pairs.

Upon the testimony the jury could have found that the plaintiffs were suffering from ptomaine poisoning caused by this foreign substance in the pie. The defendant company maintained a bakery which is well lighted

and in which seven to ten men were employed. It made the pie crusts and baked its own pies, but bought the filling, including that which went into the pie in question, from a large and reputable concern which had been in the business of making pie filling for many years. This filling came to the defendant in wooden pails with tops nailed down. The pails were kept in the defendant's storeroom until wanted and then taken to the bakery and contents used to fill the pies by men who worked under an electric light. The upper crust was then put on and the pie baked. The head baker testified that he made no inspection of the raisin pie filling and that he made none of any filling except when called to his attention. The jury could have found that the foreign substance was in the filling when the upper crust was placed on the pie; that this substance could have been discovered by a reasonable inspection of the filling either before it was put into the pie or by the defendant's employees if exercising reasonable care when making the pie.

Report from Superior Court, Suffolk County; John D. McLaughlin, Judge.

Cuneo and Louis Annacone against Harry
Bill for equitable replevin by Andrew
Smith and John Langone. On report. De-
cree for plaintiffs.

Vincent Brogna, of Boston, for plaintiffs.
Samuel Bergson, of Boston, for defendants.

CARROLL, J. In January, 1921, the plaintiffs delivered to the defendant Langone, an automobile, under an agreement of conditional sale, by which title was not to pass to Langone until eleven promissory notes, payable monthly, were paid. The agreement provided that the failure to pay any one note when due terminated Langone's right to the possession of the automobile. The last four notes, due August 7, 1921, September 7, 1921, October 7, 1921, and November 7, 1921, were not paid at maturity. The automobile was duly registered in the name of Langone as owner. It was damaged in an accident, late in November, 1921, and was taken by him to the shop of the defendant Smith, for repairs. Smith had no knowledge that Langone held possession under a conditional sale or lease agreement, and made the [3] The defendant was a manufacturer of repairs. It was found that the automobile a part of the pie and for that reason was exceeded $20 in value. It was agreed that responsible for the finished product. The the plaintiffs, in September, 1921, attempted tendency of courts is to hold the manufactur- to locate Langone and take possession of er of food to a high degree of care because the property, but were unsuccessful; that

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