Lawler v. Kell, Exrx.

The motion will therefore be overruled.

The above decision also applies to the assignment of E. E. Evans, and the assignment of W. L. Grant.

Rendigs, Foraker and Dinsmore, for the County Treasurer.

George S. Bailey, Owen F. Kinney and Ben B. Dale, Contra.

CORPORATIONS.

[Hamilton Common Pleas Court, May, 1897.]

WILLIAM J. LAWLER V. FLORENCE C. Kell, Exrx.

1 NATURE OF A CERTIFICATE OF STOCK IN A CORPORATION.

A certificate of stock in a corporation so far partakes of the nature of a chose in action that an assigment of it may be made in equity.

2. ASSIGNMENT upon Valid ConsideratioN MAY BE MADe by Mere Delivery,

An assignment upon valid consideration may be made by mere delivery, an endorse ment or instrument in writing not being necessary to pass the title.

3. Failure of Transferer to Endorse tHE CERTIFICATE OF STOCK. Where the transferer intends to part with his title to the transferree upon valid consideration, but has failed, neglected or refused to endorse the certificate, he, or after his death his personal representative, may be compelled in equity to make the endorsement so as to enable the transferee to obtain a transfer of the shares to himself on the books of the corporation.

4. GIFT INTer Vivos.

Whether such delivery would be effective as a gift inter vivos quaere?

HOLLISTER, J.

Plaintiff was related by marriage to the late Wesley M. Cameron, was his friend and confident, was governed in respect to his conduct largely by Cameron's wishes, and had been of service to him; but had never been, so far as appears, in his employ. The defendant is the daughter of Cameron and executrix of his will.

Cameron, some time before his death, in recognition of plaintiff's conduct in a certain particular being conformed to his wishes, and as a token of appreciation of plaintiff's fidelity and thorough affection, delivered to plaintiff a certificate of stock in the American Shot & Lead Co. for two hundred and sixty-one shares, valued at $9,009.53, intending thereby to make plaintiff the absolute owner thereof, but did not endorse the certificate in blank or otherwise, and made no written assignment of it.

At the time of Cameron's death the certificate was in plaintiff's hands, and a short time thereafter he presented it to the defendant, laid claim to it, which was denied, and left it with her. It is fairly to be gathered from the evidence that he was seeking recognition as owner of the stock.

The defendant, in making return of the assets of the estate, filed an inventory in which this stock appears with the statement that it is claimed by a third person, who is about to institute proceedings against her to enforce his title.

The conduct of plaintiff referred to consisted in his giving up lucrative employment with the American Shot & Lead Company, at Cameron's special instance and request, Cameron then being engaged in bitter litigation with that

company.

While this gratification of Cameron's wishes was of no pecuniary benefit to him, yet it was a detriment to plaintiff, and forms legal consideration for the delivery of the stock to plaintiff. The consideration may be a benefit to the promisor, or to a third party, or may be of no apparent benefit to anybody; but

Hamilton Common Pleas Court.

merely a detriment to the promisee." Anson on Contracts, 74; Saunders v. Pope, 1 O., 486.

The fact that a valid consideration passed to Cameron removes from the case the necessity of deciding the very unsettled question whether or not there must be an actual transfer of the stock itself on the books of the corporation in order to constitute a valid gift inter vivos.

The certificate in Cameron's hands, issued in his name, was evidence of his ownership of certain rights in the corporation as a stockholder. Bank v. Burr, 24 Me., 256, 264; Bank v. Gifford, 47 Iowa, 575, 583. In this respect the certificate has been likened to a bond or promissory note. The holder has not actual posession of his interest in the corporation, but has the possession of the evidence of his interest; Gilpin v. Howell, 5 Barr, 57, cited in Angel & Ames on Corporations, 561; Morawetz on Private Corporations, 173.

The shares are personal property which the owner may sell or dispose of at his pleasure Bradley v. Baunder, 36 Ohio St., 28, 35, and the certificates evidencing the right to shares are choses in action. Daniel on Negotiable Instruments, 1708 a, note 3.

"A certificate of stock is a muniment of title of the same nature with the note or bond of a private person, ordinarly called a chose in action,' or of a state or United States bond or certificate of debt." Shaw C. J in Hutchins v. Bank, 12 Met., 421.

It is well settled that a bill or note payable "to order" may be transferred without endorsement, the transfer taking the equitabie title to it. Daniel on Negotiable Instruments, 664. a And the mere delivery of a chosen in action for a good and valuable consideration is a sufficient assigment. Prescott v. Hull, 17 Johns, 284, 292.

*

Says the vice-chancellor in Hughes v. Nelson, 29 N. J. Eq., 547, 549: “In equity a chose in action * * may be assigned by mere delivery and without any writing whatever." Citing Galway v. Fullerton, 2 C. E. Green, 394; 2 Story on Equity Jurisprudence 1047. And in Story on Prom. Notes, 120, it is said: "If, by mistake, accident or fraud a note has been omitted to be endorsed upon a transfer, when it was intended that it should be, the party may be compelled by a court of equity to make the endorsment, and * * * If he should die, his executor or administrator will be compellable * * * to make it. The assignees of a bankrupt under the like circumstances may be compelled to make an endorsment of a note transferred before his bankruptcy." See also, Story on Equity Jurisprudence, 996, 729; Smith v. Pickering 1 Peak's Rep., 69; Mallon v. Southard, 36 Me., 147; Ex parte Mobray, 1 Jac. & Walk., 428; Ex parte Rhodes, 3 Mont. & Ayr., 217; Ex parte Greening, 13 Ves., 206; Hughes v. Nelson, supra.

In Watkins v. Maule, 2 Jac. & Walk. 237, 243, the master of the rolls said: When a note is handed over for a valuable consideration the endorsement is mere form-the transfer for consideration is the substance; it created an equitable right, and entitles the party to call for the form. The other is bound to do that formal act in order to substantiate the right of the party to whom he has transferred it; and, as he is bound to do it, the endorsement by his representative is undoubtedly as good as if it was by himself."

The mere possession of such chose in action is not enough, however, to establish even a prima facie right to it, as against the payee or his personal representative. Gano v. McCarthy, 79 Ky., 409. And, "The holder takes it as a mere chose in action, and while he may maintain an action upon it in his own name, he must prove the transfer to himself." Van Ewan v. Stanchfield, 10 Minn., 255.

The rule is established that the delivery of a certificate of stock, endorsed in blank, or with a written power of attorney to transfer the shares, based on a valid consideration, passes to the transferee an equitable title to the stock. Morawetz on Private Corporations, 174, and cases cited in note 1. If, then, a certificate is a chose in action resembling a promissory note, it may pass by delivery without

Groenland v. The State of Ohio.

endorsment or instrument in writing as such a note does, and the assignment is quite as effective as it it were in writing. This conclusion brings into exact point the established rule just now referred to.

The plaintiff is, therefore, the equitable owner of this stock as against Cameron's estate, and is entitled to an endorsment of it by the defendant, as executrix. The court may not, perhaps enforce an order directing a defendant to endorse sua manu; but its decree would, doubtless, be as effective in case of her refusal to do so.

The plaintiff may take judgment.

Paxton, Warrington & Boutet, for Plaintiff.
Matthews & Cleveland, for Defendant.

PURE FOOD LAWS.

[Hamilton Common Pleas Court, 1897.]

ROBERT GROENLAND V. THE STATE OF OHIO,

1. THE INFORMATION OR INDICTMENT MUST be Definite.

The information or indictment charging a person with the ccmmission of a crime must state the charge of the crime with certainty and precision, and set out the facts which constitute the same, so as to advise the accused what he may expect to meet on the trial. This is a constitutional right and cannot be dispensed with by legislative authority. 2. RULE IN CHARGING A STATUTORY OFFENSE.

The rule that charging a statutory offense in the words of the statute is sufficient, is inapplicable, where the statute does not use sufficient words to describe the offense, as where there is indefiniteness as where the offense is stated involving a conclusion.

3. CHARGE INSUFFICIENT FOR INDEFINITENESS.

Where a person, under the pure food laws, is charged with the adulteration and for having on sale a certain drug, which was alleged to differ from the standard of strength laid down in the United States Pharmacopoeai, but which failed to state whether such drug was above or below in the per cent. of strength, or in the strength of either or the elements of which it was composed: Held, that such charge is insufficient for indefiniteness.

BUCHWALTER, J.

The defendant was convicted before a jury in the justice of peace court upon the following charge:

"That on or about the 9th day of October, A. D. 1896, at the said county of Hamilton, Groenland, sold to A. Bierlein, 1doz. solution-sub-acetate of lead, a drug, recognized in the United States Pharmacopoeia, and used externally for a medicine, which was adulterated in the following respect, to wit: Said solution sub-acetate of lead differed from the standard of strength laid down in said United States Pharmacopoeia, contrary to the statutes in such case made and provided."

The transcript with bill of exceptions presents to the record of trial

1.

Error is claimed in the charge of the justice as to reasonable doubt, but the defendant's exception was not directed to that feature of the charge, nor the attention of the justice called to that fact. Therefore the defendant cannot avail himself of that error, if any.

2.

My attention is also called to the alleged errors of the justice in overruling the defendant's motion to quash his demurrer filed before proceeding to the trial by jury, and to the overruling of his motion in arrest of judgment after verdict, as well as of the motion for new trial.

My attention is especially directed to the alleged indefiniteness of the accusation in the affidavit or complaint upon which defendant was arrainged and tried. It was the constitutional right of the defendant to have a statement of the nature

Hamilton Common Pleas Court.

and cause of the accusation against hin. Section 10, Bill of Rights. The accusation in this complaint would cover the offense of adulterating such drug, the subacetate of lead, whether it differed from the standard of strength laid down in said Pharmacopoeia, in being above or below in the per cent. of strength, or in the strength of either of the three elements of such compound drug. (The proof shows that said drug is composed of 100 parts of oxide of lead, 170 parts of acetate of lead and distilled water, boiled together in solution at or about 25 per cent. as sub-acetate of lead). It is clear then that the complaint was indefinite. Every one charged with crime is presumed innocent until proven guilty, and an innocent man could not know the nature of such a charge, or of which of said charges he would have to meet. Besides, as the sample is procured by the prosecution, it is known to a certainty from analysis wherein the difference is; it is upon the sample sold that the charge is founded. It is an unfair advantage taken of the defendant, and contravenes his constitutional right, not to charge him in the statement with such definiteness of fact as is plainly within the knowledge of the prosecution, and not within the knowledge of an innocent man.

The text writers on criminal pleading state the rule to be that the information or indictment must state the charge of the crime with certainty and precision, and set out the facts which constitute the same. See also, Dillingham v. State, 5 O. S., 280., (paragraph 5, of the syllabus); Lamberton v. State, 11 O. S., 282; Foutz v. State, 8 O. S. 98., 114; Davis v. State, 7 O. (pt. 1,) 204; Lane v. State, 39 O. S., 312, 313; McLaughlin v. State, 45 Ind., 338.

Even legislative authority cannot dispense with the constitutional require-· ment to set out definitely the nature of the offense so that the accused may be informed. The rule that charging a statutory offense in the words of the statute is sufficient, is inapplicable, where the statute does not use sufficient words to describe the offense, as where there is indefiniteness, or where the offense is stated involving conclusion. 1 Bish. Crim. Procedure, section 619; State v. Hill, 79 N. C., 657; State v. Credle, 91 N. C., 644.

The motion to quash ought to have been granted. The charge in the affidavit or information should have set out the standard elements or character of the drug, the sub-acetate of lead, as described in the U. S. Pharmacopoeia known at the time of the enactment of the statute, and the constituent elements of the defendant's drug—or at least that element in which it differed from the standard.

3. Another error is claimed which I find well founded. The prosecution did not prove that the drug was sold by the defendant, nor by any authorized agent. The bare proof was made that it was sold from the defendant's drug store. This has been held to be insufficient. Parker v. State, 4 O. S., 563, 565, (3d paragraph of the syllabus.)

At the close of the trial defendant's counsel moved to arrest the evidence and for discharge of defendant, which motion ought to have been granted, and this error is not cured by evidence given by witnesses for the defense.

Judgment reversed, and cause remanded.

Heidorn et al. v. Wright.

LEASE-COVENANTS.

[Superior Court of Cincinnati, General Term, June, 1897.]

FREDERICK HEIDORN ET AL. V. CHARLOTTE K. WRIGHT.

1. COVENANTS IN A LEASE RUN WITH THE LAND, WHEN.

If a covenant in a lease restricts and qualifies the estate relative to the mode of its use, enjoyment, or to the manner of its occupancy, is not unreasonable or unlawful, and the ease clearly shows the intention. of the contracting parties to annex it to and make it appurtenant to the leasehold estate, it runs with the land, and the assignee of the lessee is bound by it, although he is not named in the lease. A fortiori, if he is named, he is bound.

2. VIOLATION OF A COVENANT WILL BE ENJOINED BY A COURT OF EQUITY.

But whether such covenant technically at law runs with the land or not, equity will enjoin the assignee of the leasehold, if he have notice of it when he acquired the title, from violating its stipulations.

3. Assignee of Leasehold will be PresuMED TO HAVE NOTICE OF ANY COVENANTS. If the covenant appears in any instrument constituting a muniment of title, the assignee of the leasehold will be conclusively presumed to have notice.

4. LEASEHOLD WITH RESTRICTED COVENANTS.

*

A lease for ninety-nine years, renewable forever contained a covenant, stipulating, among other things, that the "demised premises, or any part thereof, or any building thereon, shall not, at any time hereafter, be used or occupied ** for a blacksmith shop or "for any other purpose than private dwelling houses, without the written consent of the trustees of Lane Seminary. The covenant was between the lessors (trustees of Lane Seminary) and their assigus, and the lessee and his assigns: Held, that the covenant runs with the land; that a farrier is a blacksmith under the terms of the covenant, and that equity, at the instance of the assignee of the reversion, will enjoin the assignee of the leasehold from carrying on the business of a blacksmith on the premises.

HOLLISTER, J.

The questions in this case grow out of a covenant in a perpetual lease originally made to one Startzman by the trustees of Lane Seminary of a lot of land situated on Kemper Lane in the city of Cincinnati. This lot was a part of a large tract devised to the trustees for educational purposes. After several intermediate conveyances, the plaintiff in error Heidorn, became the owner of the leasehold by deed. The covenant giving rise to the litigation reads:

"And, further that the said demised premises or any part therecf, or any building thereon, shall not, at any time hereafter be used or occupied for manufacturing, keeping or vending ardent spirits, or for keeping a tavern or public house, or for a blacksmith shop, or for the manufacturing of soap or candles or a livery stable or for slaughtering animals, or for a butcher shop or stable or a tin shop; and, further, that said premises shall not be occupied for any other purpose than private dwelling houses without the consent of said trustees of Lane Seminary; and this lease, however, is made on this condition; that if any installments of the .rents hereby reserved shall remain unpaid for the space of six months after the same shall have become due, or if any other of the covenants herein contained on the part of Samuel Startzman, his heirs, executors, administrators or assigns to be done and performed, shall be violated and not fully kept, then and in either case this lease and the term hereby created shall cease and determine and be utterly void, and the said trustees of Lane Seminary, their successors or assigns, may thereupon forthwith re-enter upon the said demised premises, and hold the same as though this lease had never been executed, free and discharged of the same."

After the execution of the lease the trustees conveyed the reversion to Charlotte K. Wright the defendant in error.

Heidorn erected a building on the premises, constructed in such a manner that the upper stories were available for dwelling purposes, and the