Merchant's National Bank v. Pope

Thayer, C. J., delivered the opinion of the court. The counsel for the appellant contends that a circuit court cannot properly interfere with the findings of a referee regarding any fact as to which there is a conflict of evidence, and insists that there was evidence in this case tending to prove that the said firm of Geo. Pope & Co. [42] was to receive five per cent commissions on all shipments and sales of oil and fish, and that the said circuit court should have left undisturbed the finding of fact by the referees upon that question. He also contends that there was no evidence authorizing said circuit court to allow to the trading company credits for interest upon the certain drafts drawn by the said firm against consignments of oil shipped by the firm for said company. The statute, section 229, Civil Code, provides as follows: ‘ ‘ The court may affirm or set aside the report” (referring to the report of the referee before whom a trial of the issues in an action has been had) “either in whole or in part. If it affirm the report, it shall give judgment accordingly. If the report be set aside either in whole or in part, the court may make another order of reference, as to all or so much of the report as is set aside, to the original referees or others, or it may find the facts and determine the law itself and give judgment accordingly. Upon a motion to set aside a report, the conclusions thereof shall be deemed and considered as the verdict of a jury. ” The language of this section of the Code is too plain to be mistaken. It authorizes the court to set aside the report of a referee under the same circumstances in which it is authorized to set aside the verdict of a jury and grant a new trial, which it may do when the verdict is against the great weight of evidence. And in case it does set aside the report, in whole or in part, it is the duty of the court to make another order of reference, as to all or so much of the report as is set aside, to the original referees, or to others, or it may find the facts and determine the law itself and give judgment accordingly. If the court adopt the latter course, it is its duty to find the facts and conclusions of law in the same manner it is required to do when it tries a case where -a jury trial has been waived. The court did not pursue that mode in this case, but I do not think the error is of such a nature as would authorize a reversal of its decision, as it evidently did not prejudice the rights of the appellant. It, however, would have been [43] the better practice to have pursued the course indicated, and cases may arise in which it would be highly important that it should be done. I have examined the evidence as to the amount of commissions which the said firm was to receive upon the shipment and sales of the oil and fish, and am of the opinion that the circuit court very properly made the reduction in the amount found to be due by the referees. The only testimony upon that point seems to have been that given by McDonald, and he testified that he made the arrangements himself on behalf of the firm to sell the oil at five per cent commission, two and a half of which was to go to R. D. Welch and two and a half to be retained by the firm. This arrangement covered the first shipments up to a certain date; that afterwards he made arrangement with Mr, Lowenberg to the effect that the trading company should pay seven and a half per cent commissions, five per cent of which was to be retained by the said firm of Pope & Co. The referees allowed five per cent commissions on all oil sold, and the circuit court only made the reduction in accordance with the arrangement as testified to by said witness. It is claimed that McDonald, in making out a statement of the accounts between the trading company and the firm, charged the five per cent commissions on all the sales, but this was hardly sufficient to impeach his testimony regarding the arrangement made with'Lowenberg, nor does the testimony of Pope contradict that of McDonald’s in regard to the said arrangement. The finding of the court that the trading company should have credit for the sum of §43.08 on account of fish sold by the firm of Geo. Pope & Co. instead of §21.25, as found by the referees, involves so slight a difference that the counsel for the appellant expressed at the hearing a willingness to waive any point regarding it. The decision of the circuit court, however, that the trading company was entitled to creditsforinterest upon the certain drafts referred to, does not-.saem to be supporlad-by allegations, finding ox proof. [44] It could not have been claimed by the respondent in the complaint, as the balance of the entire accounts between the company and the firm claimed by it was only 17,740.56, which evidently did not include a credit of $5,936.92, the proceeds of the draft for that sum drawn by the firm against certain consignments of oil. That the firm should have credit for the amount of said draft was the main contention between the parties to the action; and the referees found that issue in favor of the appellant, which finding the circuit court substantially confirmed. By giving the firm that credit, the claim of the respondent only amounted to $1,603.64, the difference between the $7,740.56 and the $5,936.92, which was subject to a further'reduction for interest charged in favor of the trading company upon the money drawn. The appellant admitted in the answer an indebtedness of the firm to the trading company of the sum of $1,394.90, to which should have been added the $189.54, the overcharge for commissions upon the shipment and sales of the oil. The real difference, therefore, in the accounts between the parties as claimed by them in the pleadings, after being adjusted in the respects above mentioned, was very small. The circuit court, however, increased it several hundred dollars by deciding that the trading company was entitled to credits for interest upon the drafts referred to. This allowance apparently was on account of a matter which was not legally in controversy between the parties, as it did not in fact constitute any issue in the case. There was no evidence concerning it, except that Pope & Co., after making shipments of the oil, and after having made advances to the trading company on account thereof, drew against the consignments and negotiated the drafts so drawn at the city of Portland. They did this in eight instances, but did it upon their own account and by pledging their own credit. It is true that they attached the bills of lading to the drafts negotiated, which became collateral security in the hands of the holders of the drafts. They were entitled to do that, and I cannot see that it gave [45] the trading company any right to claim interest on the money so obtained. Pope & Co. had no authority to pledge the oil for the payment of the drafts, but they had a lien upon it constituting a special property interest, to the amount of the advances made by them to the trading company, which they had a right to pledge for their own use. Colebrooke on Collateral Securities, §§ 407, 408. The decision of the circuit court allowing interest on said draft must, therefore, be reversed, and the judgment rendered by said court be so modified that the respondent recover of the appellant the said sum of $1,394.90, found due by the referees, the further sum of $189.54, the rebate upon the commissions as charged by the firm of Pope & Co., with $25.76 interest on said last-mentioned sum, also ,$42.75, the price of the fish sold by said firm in excess of the amount found by the said referees, — amounting in all to the sum of $1,652.95, together with interest thereon at the rate of ten per cent per annum from the time of the commencement of the action. The case will, therefore, be remanded to the said circuit court with directions to enter judgment as herein provided, with costs and disbursements, in favor of the party legally entitled to recover the same. Each party to pay their own costs and disbursements incurred in this court, and neither will be entitled to recover costs or disbursements from the adverse party.