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Levine v. D. Wolff & Co.
78 N. J.L.
R. I. 218; Hickey v. Morrell, 102 N. Y. 454; Walden v. Finch, 70 Pa. St. 460.
It is to be noted also that the reasonable care contracted for was that ordinarily exercised by a warehouseman "to store" the plaintiff's goods, and it has been held that this duty imposed upon the warehouseman such care and diligence as good and capable warehousemen are accustomed to show under similar circumstances. Lancaster Mills v. Merchants Cotton Press Co., 89 Tenn. 1.
The defendant insists that because its own goods were stored in another portion of this stable, the reasonable care required of it by law was furnished by storing the plaintiff's goods in the same place.
Without referring to the implication that may fairly arise upon the facts of the case, that the plaintiff when he contracted with a warehouseman “to store” his goods had reason to assume that a stable would not be their destination, the adjudicated cases are to the contrary of defendant's contention.
Lord Holt, in Coggs v. Bernard, 2 L. Raym. 909, by way of obiter afforded a basis for such a construction of the law regarding reasonable care, but this notion has been exploded, and the true rule is now declared to be that if the bailee uses the same care in regard to the property bailed that he bestows upon his own, it is but evidence tending to show that he is not guilty of gross negligence, or, as was stated in one case, it is merely “an argument for his honesty.” Giplin v. McMullen, L. R., 2 P. C. 317.
Apropos of this contention, Chief Justice Tindal once observed that to fix a standard of liability co-extensive with the individual judgment would make it as variable as the foot of each individual. Vaughan v. Menlove, 3 Bing. (N. S.) 468; Doorman v. Jenkins, 2 Adolph. & E. 256.
When, therefore, the plaintiff proved the delivery of the chattels in good condition to defendant, and their destruction thereafter by fire upon defendant's premises, the law presumes the negligence of the bailee to be the cause of the loss, 49 Vroom.
Parsons Mfg. Co. v. Hamilton Ice Mfg. Co.
and this presumption could be rebutted only by affirmative proof of reasonable care upon defendant's part. Jackson v. McDonald, 41 Vroom 594.
Therefore it was a question entirely of fact whether the storing of these goods in defendant's stable upon a wagon for two days and nights, under a contract with defendant as a warehouseman, to use such reasonable care in storing them as men in that line of business usually take of goods committed to their care, was a compliance with the duty thus imposed upon this defendant by law, and the court having found as a fact that it was not, we cannot disturb that finding.
The judgment is affirmed.
PARSONS MANUFACTURING COMPANY v. HAMILTON ICE
Argued March 19, 1909-Decided June 7, 1909.
The defendant corporation took over the assets and business of an
incorporated company of the same name with the prefix "The”
Parsons Mfg. Co. y. Hamilton Ice Mfg. Co.
78 V.J. L.
On application for a rule to show cause for a new trial.
Before Justices REED, TRENCHARD and MINTURN.
For the plaintiff, Wilson, Carr & Stackhouse.
For the defendant, French & Richards.
The opinion of the court was delivered by
MINTURN, J. The Hamilton Ice Company, of Camden, New Jersey, and the plaintiff, entered into a contract for the conditional sale to the ice company of an automatic blower known as the “Parsons System.” The device was intended to regulate the draft upon the equipment of the ice company, and its cost was $1,300, payable in installments. The contract was signed on behalf of the ice company by N. B. Armstrong, manager, and the note in suit for a balance of $1,030 was given on January 15th, 1906, and was signed "Hamilton Ice Manufacturing Company, N. Bruce Armstrong, Treas.” The Hamilton Ice Manufacturing Company, the defendant, was duly incorporated under the laws of the state on February 7th, 1906, and the incorporated company leased and took over the plant of the former company from one Robert G. McDougall, by an instrument in writing dated the 1st day of March, 1906. The officers of the corporation were Armstrong, McDougall and one Rose, who controlled all of the stock.
The plaintiff seeks in this suit to hold the defendant corporation liable for the note thus given, upon the ground that the payment thereof was assumed by defendant as one of the liabilities of the old company when defendant took over the property and assets of the former company. With this basis of liability in view the plaintiff gave testimony going to show that the ice plant with the automatic device, just as it stood, was taken over by defendant; that the officers of the new corporation were the same men who had been directing and operating the old plant, and that in such respect no substantial change took place except in defendant's status as a
Parsons Mfg. Co. v. Hamilton Ice Mfg. Co.
legal entity between the old and the new concerns until the summer of 1908, when the defendant sold the machinery of the plant and presumably possessed itself of the proceeds. Plaintiff contends that both McDougall and Armstrong as the managers of the old concern knew of this outstanding obligation, and when they organized defendant corporation and took the assets of the old company it was within their contemplation that the new company should assume the indebtedness of the other, and with this in mind they caused the note in suit to be made not by the old concern but omitting the prefix "The” caused the note to be signed by the defendant corporation before it was organized. Upon subsequent occasions, and while managing defendant company, they met the representative of plaintiff and pleaded for an extension of time to pay the note, promised to deliver the note of the new company in substitution for the note in suit, and actually paid $30 interest upon the old obligation, but never delivered the new note.
It appears in the case that the organization meeting was the only meeting ever held of defendant company, and that Armstrong and McDougall, controlling the stock, managed and dictated the affairs of defendant ab libitum and without the formalities of corporation routine. Except for the responsibility that the law imposed upon them in the interest of creditors, they were practically the factotum of the corporation and responsible only to themselves for the propriety and legality of their management.
But it is not necessary to uphold the liability of this defendant upon that ground alone, for upon the basis of a novation of this debt, as well as upon grounds of estoppel, this defendant's liability seems clear. “Novation consists of a bilateral agreement for the substitution of one obligation for another and may take place either by the substitution of a new for an old party, or by the substitution of a new agreement between the same parties, or by a change of parties and agreement at the same time.” 29 Cyc. 113 t, and cases cited; Lattimore v. llarsen, 14 Johns. 330; Munror v. Perkins, 9 Pick. 298.
Parsons Mfg. Co. v. Hamilton Ice Mfg. Co.
78 N. J. L.
Whether or not the novation in fact existed was a question under the testimony and the circumstances for the jury to pass upon. Bullock v. Tompkins, 125 Mich. 17; 29 Cyc. 1110, and cases cited.
And since a formal documentary novation was not essential to plaintiff's right to recover, the formal allegation of the novation in the declaration was not necessary. Minternich v. Tresud Fruit Packing Co., 123 Cal. 379; 29 Cyc. 1129.
It was also perfectly competent for the corporation through its agents to ratify the agreements of those agents, and this ratification, which is substantially another method of estoppel in pais, may be evidenced from the facts and circumstances and the acts of the parties, and the nature of the subjectmatter involved. Fifth Ward Bank v. First National Bank, 19 Vroom 513; State v. Morris and Essex Railroad Co., 3 Zab. 360; Park v. Grant Locomotive Works, 13 Stew. Eq. 114. While this doctrine of estoppel is equitable in its origin, it is equally available in an action at law in order to subserve the ends of justice. Kirk v. IIamilton, 102 U. S. 68.
There is ample authority also to support the proposition that the defendant having taken over the assets of the former company for the purpose of carrying on its business, without apparent change in the personnel of the concern, is liable for the payment of the debts of the former concern. It is held to take the benefits and advantages cum onere. 10 Cyc. 1111, and cases; Davivier v. Gallilee, 139 Fed. Rep. 118; Hibernia Fire Insurance Co. v. St. Louis Railway Co., 10 Id. 596.
We conclude, therefore, that it was a question of fact for the jury to determine whether upon the testimony and the circumstances of the case the defendant assumed the payment of this indebtedness as its own obligation, and the jury having found for the plaintiff, it must be assumed that their verdict was predicated upon that fact.
The application for the rule to show cause will be denied.