Papot v. Southwestern Railroad

Jackson, Chief Justice.

This case has been three times before the superior court of the county of Bibb, and three times a verdict for the plaintiff has been returned — twice for the full amount sued for, and the last time for a less sum. Twice before it has been before this court. 59 Ga., 342; 67 Id., 675. On all material issues of law, the questions have been decided by this court, and a new trial was granted the defendants on errors of law alone, and as contrary to one charge of the , court, in the opinion in the 67th Ga.

On the motion for a new trial from the last verdict, the court below granted it on all the grounds taken in that motion, including the ground that the verdict is contrary to law and evidence, thus necessitating this writ of. error at the instance of the plaintiffs, inasmuch as it is not the first grant of a new trial, in which case the discretion of the court to have a new trial' on the evidence is rarely disturbed. The questions made on the present assignments of error are, first, was there , error material to the real issues on trial in any ruling of the court; and, secondly, is the verdict so strongly and decidedly against the weight of the evidence as to authorize the grant of a new trial this time?

1. The admission of the testimony of Papot in respect to interest accumulated on the shares of the capital stock of the Vicksburg and Brunswick Railroad Company, transferred to the defendants by Shorter, Papot & Co., if objectionable as irrelevant, is not so material as to require a new trial. It rather strikes us, however, as relevant, inasmuch as those shares were the quid pro quo — the consideration given by Papot & Co. for the shares of the Southwestern Railroad Company, for a remainder of which, alleged to be due them by the Railroad Company, the suit was brought.

2. There was no error in permitting proof that the Central Railroad Company directed an examination into the. status of the Vicksburg and Brunswick Railroad Company in respect to its general condition, indebtedness, etc., inasmuch as one the issues is that Papot & Co., by fraudulent misrepresentations or suppressions of truth in respect to its true condition, had defrauded the defendants. Anything tending to show information to defendants, or opportunity to be informed by them about that condition, might, and probably would, throw light on the charge of fraud, and to what extent the defendants were hurt thereby.

3. The pencil memoranda of Virgil Powers at the foot of a letter of Ketchum & Hartridge to Holt, as to what he might report to Ketchum & Hartridge, were ruled out properly, as Papot & Co. knew nothing about them, nor did Ketchum & Hartridge. What was reported to them, if material, was the thing admissible. Besides, if admitted, the memoranda amounted to nothing. “ You may say I have the matter under investigation, and will report amount due as soon as practicable,” and “ Please return to me with my answer per K. & H. Have directed J. M. Waldron, road master, to make return to me of the cost of completing the work left unfinished ; when he reports, I will give you statement of settlement,” are the memoranda, and their admission or rejection could have little bearing on the issues in the case.

4. The record of the marshal’s deéd, recorded in Alabama, is not proof of the deed in the courts of this state, so as to admit the deed in evidence without proof of execution. Baskin vs. Vernon, this term.

5. The fifth ground is that the court erred in charging the jury, “If, on the other hand, there was no such contract as (hat made by Papot & Co., that they did not agree to pay General Holt, or the Southwestern Railroad Company, eight per cent on the advance of their stock, but that the consideration for this advance was the turning over of the road from the Vicksburg and Brunswick Railroad Company to the Southwestern Railroad Company, — I say, if that was the consideration, and there was no interest agreed upon tobe paid by them,'then I charge interest would not be allowable to the Southwestern Railroad Company. If that was a different contract — for instance, if they said, ‘You will advance us this stock, and you want this road, and it is to your interest to have it, if you will advance us this stock, we will turn over this road and ' our stockand if that was the consideration whereby the Southwestern Railroad Company agreed to turn over this stock, then they would not be entitled to it.5’

We are unable to see error in this charge, read in connection with the charge in full, which is' reported at the head of this opinion.

6. The sixth ground is, because the court erred in charging the jury, “ But if, on the other hand, you believe from the evidence that, at the time Wadley made this purchase (I say Wadley for the Central Railroad), he had been informed that there were debts and liabilities against the railroad, and that they had indorsed these bonds for Barbour county, and he bought with that knowledge, then I charge you, you would be authorized to find for Papot, and against the railroad, on that issue.”

Read in the connection with the full charge, there is no error in this exlract.

7. The seventh ground is, the court erred ih further charging the jury, Or if you believe from the evidence that Wadley did not take Papot’s word for it, but sent his counsel there to look into this matter, and that counsel ,repor)ed to him there were no debts or liabilities, and he bought with that-understanding; or if you believe that, not relying on Papot’s sayings, he relied on the sayings of his counsel, leaving Papot entirely out, and he bought, and there were debts, then you would be authorized to find for Papot, and against the railroad.”

The above, considered alone, and as written in the ground of the motion, would be error, because it would impress the jury that,- if the counsel reported that there were no debts or liabilities, and the railroad company relied on their report of what turned out .to be false, though Papot, who knew better, represented the same thing, yet the company would be bound by the misinformation of their counsel, as between itself and Papot, when Papot had confirmed its belief of a lie by vouching for it as the truth. But the record is confused in respect to what this charge really was. The motion for a new trial makes it as above written, but the charge itself leaves out the little word “ no,” which I have italicized, and makes the charge read thus; “ Or if you believe from the evidence that "Wadley did not take Papot’s word for it, but sent his counsel there to look into this matter, and that counsel reported to him there were debts or liabilities, and he bought with that understanding, or if you believe that, not relying on Papot’s sayings, he relied on the sayings of his counsel, leaving Papot entirely out, and he bought, and there were debts, then you would be authorized to find for Papot, and against the railroad.” And the next paragraph oí the charge explains the meaning beyond all cavil. It is as follows: “ If you believe from the evidence that Wadley sent his counsel there, and that counsel made all the investigation that was possible to make, and he reported that there were no debts or liabilities to which the road was subject, and Wadley bought on that report, and Papot & Co. knew at the time that there were debts and liabilities to which the road was subject — I say, if that is the truth"of the case, then Papot cannot recover, and you would be authorized to find for the railroad.” The meaning of which, taken together, we take to be that, if Papot made no Representations and suppressed no facts which tended to induce Wadley to make the contract, and Wadley acted entirely free from any such fraud, open or concealed, on the part of Papot, then Papot might recover; but if he was influenced by the conduct of Papot, or any of his company, to believe that the Vicksburg and Brunswick Co. was not in debt, when he knew it was, then he could' not recover. So, construing the whole of the charge on this subject, which is further expanded and explained in the full charge, we are unable to see the error therein. It excludes Papot from recovering, no matter what Wadley’s counsel reported, if Papot’s skirts were unclean in the transaction; but if Wadiey acted on the investigation and report of his own counsel, unaffected by any falsehood, direct or indirect, by Papot, etc., then Papot might recover.

8. The 8th ground is as follows: Because the court erred in charging: “ It is claimed that one of the attorneys making this investigation was the attorney of the Central Railroad, to-wit, Eli Shorter, and that he knew that the indorsement of the Barbour county bonds had been made by the Yicksburg and Brunswick Railroad Company. Therefore, his knowledge, it is claimed by Papot, was the knowledge of the Central Railroad. On that point, I charge this to be the law: If you believe from the evidence that General Lawton and Eli Shorter were attorneys for the Central Railroad, and that they were appointed by Mr. Wadley, or the board of directors, to go and make this investigation, and you believe that Eli Shorter, being appointed specially for this purpose, knew of these indorsements on this road, then his knowledge became the knowledge of the Central Railroad; if he found it out by reason of the fact that he was the appointed lawyer for this special occasion, then whatever he ascertained, whatever came to his knowledge by reason of his employment in that particular business, was the knowledge of the Central Railroad; but, on the other hand, if you should find that, although Eli Shorter was general counsel for the Central Railroad in Eufaula, and at the same time was president of the Yicksburg and Brunswick Railroad Company, and as president of the Railroad Company, he had the knowledge that these bonds had been endorsed, and he did not gain that knowledge as the attorney of the Central Railroad Company, then what knowledge he got as president of the company was not the knowledge of the Central Railroad Company, and the Central Railroad could not be bound by it, although he was their attorney, and knew all about the indorsement of the bonds.”

The principle here laid down is, that knowledge of the agent about business entrusted to him by the principal, acquired by reason of that employment, is knowledge of the principal; but if he was also at the same time an officer of the company about whose condition he was employed to make inquiry, and knew its condition from that official character, then his knowledge was not the knowledge of the company; — the effect of which charge was to exclude the idea altogether that Shorter’s knowledge at all affected the Central Railroad Company; and we do not see how the charge could have affected disastrously the Railroad Company. Shorter must have known the condition of the company by reason of his office as its president, and not from discovery made by his agency as special attorney for the Central Railroad. The charge had better have been that, if Shorter was president of the Vicksburg and Brunswick Railroad, and also in the employment of the company defendant here, then the company would not be affected at all by what he knew as president, and must have known in that character, which would have been plainer; but as it is, with a jury of ordinary capacity, it meant that, and did no harm to defendant in error. The restriction hurt the other side.

9. The next ground we consider is the refusal to charge as follows: “ If, upon the rules of law I have stated, you find that Papot, to induce the trade, made representations to the defendants, on which they acted, and which were not true, then the complainant is not entitled to recover in this case, nor will the complainant be relieved from the effects of his misrepresentations or suppression of the truth; that is, if you b.elieve from the evidence that he was guilty of any, although another person, who was the attorney of one of the companies, was guilty of a like . misrepresentation or suppression of the truth.”

We think that this request is law, and law applicable to the case, and that the refusal to give it would require a new trial, unless covered by the general charge. The whole tenor, however, of the general charge seems to us to cover substantially the request asked. It absolutely shuts the door upon Papot, unless he was clean; and he could not be clean if he had misrepresented or suppressed the truth, no matter what anybody else, attorney or not? agent or not, did or said.

10. The next ground is also a request to charge, which was refused It is : “ If the defendants made this contract with Shorter, Papot & Co. for the purpose of obtaining the use and control of the railroad and its property from Eufaula to Clayton, Alabama, and paid the full and fair value for such property, or agreed to do so, and they have lost the expected benefits of such contract by reason of outstanding debts against said property at that time, of which they were ignorant, then, under the law, the complainant cannot recover in this case, even if the jury should believe any part of the consideration agreed to be given has not been paid.”

It seems to us that the above request is too broad. Papot & Co. must have participated directly or indirectly in causing this ignorance on the part of the Central Eailroad to block all recovery. The defendants in error may have made the contract for that purpose, and plaintiffs may not have known the purpose they had in view. If so, it was not their contract. It was an exchange of stock for stock, to get control of the road, it is true, but whether to get it out of debt or not is another question. They got the stock and the control and possession, but encumbered with debt.

11. ' This brings us to the consideration of the last point, that the verdict is contrary to the great weight of the evidence, and therefore to law and equity. There were but two issues for the jury: First, was the Central Eailroad entitled to interest on the advanced stock turned over to Papot & Co.; and, secondly, did Papot & Co. bring about the.trade by fraud in misrepresenting or concealing the true condition of the road, whose stock that company exchanged for Southwestern Eailroad stock? Both issues have been decided by three juries, and the verdict should stand, if there be evidence to support it, and no material error committed by the judge. We have passed upon the alleged errors of the court on the trial; how is it as to the jury on the facts ?

On the first issue, in respect to the interest, the evidence is somewhat conflicting, yet there is enough to sustain the position that there was no agreement by Papot & Co. to pay interest on the advanced stock, but that they desired to get hold of the stock to stop interest they were then paying. It seems unreasonable that they should bargain to pay interest upon stock which ivas to be used to stop interest which they were paying. And the fact that the road was completed sufficiently to transport freight, and thai, therefore, the Central Railroad Co. wished to get its use in the “ cream ” of the freight business, and on that account went into possession before its perfect completion, and advanced the transfer of stocks on that account, as contended by Papot, and that this was the real consideration which moved the parties to change the date of the exchange of the stocks and the possession of the road, seems also reasonable. Combining the two, to-wit, that the one party wanted possession, and the other to stop paying interest, and a logical conclusion might well be reached that Papot’s contention is based on truth. If so, inasmuch as a verdict is but the truth told by the jury? should it not stand on the interest issue?

On the second issue, the verdict is as fully sustained. If Hartridge is to be believed, Wadley was informed of this indebtedness, and so was the cashier of the Railroad Company. It so, the ground-floor of the railroad’s position sinks. It bought with knowledge of the indebtedness of the Brunswick Road’s stock, and exchanged Southwestern stock for it, knowing that indebtedness. If Hartridge was mistaken, and these officers did not hear what was said by him, the evidence of fraud or no fraud on the part of Papot & Co., a peculiar question for the jury, is, to say the least, conflicting, and rather preponderates for the verdict. Papot himself swears positively, denying any representation or concealment about it, and the testimony of the witnesses for the defendants is not positive .in contradiction of his statement and denial. It is an issue of fraud or no fraud, especially a jury issue, and, on conflicting testimony, one verdict should not be hastily disturbed. Three verdicts— at least two on this particular issue of fraud — should be allowed to stand, unless facts were grossly set at defiance and ruthlessty disregarded by the juries. This is not such a case. 4 Ga., 170; 59 Ib. 111. It is true that those cases were affirmances of judgments, and the presiding judge had approved the finding, but on issues of fraud, repeatedly decided by the jury, the presiding judge should not interfere, unless the verdict on the point is clearly and' manifestly wrong. The defendants in error got the stock which enabled them to control the road, it being the majority of it, and for the balance, they paid not more than its value (judging by what they gave for the majority when they had to buy the road to extinguish the debt). Besides, it would seem they have redress upon Barbour county, Alabama.

Upon the whole, we do not clearly see how the defend-' ants in error were damaged, and conclude that the verdict ought to stand.

Judgment reversed.