Smith v. Kinney ( 1914 )

Mr. Justice Burnett

delivered the opinion of the court.

1. The so-called bill of exceptions presented in this case consists of a verbatim report of tbe testimony of tbe witnesses, tbe objections of counsel, and tbe rulings of tbe court as they occurred at tbe trial. It has been so often announced by this court that such a document ,does not constitute a bill of exceptions, except for tbe purpose of determining whether a nonsuit or a directed verdict was properly granted, that we will not lengthen this opinion by a quotation of tbe authorities, except to state that tbe latest one is National Council of Knights & Ladies of Security v. McGinn, 70 Or. 457 (138 Pac. 493). Tbe only purpose, therefore, for which this alleged bill of exceptions will be considered is to determine whether tbe court properly directed a verdict in this case.

2. It appears in evidence that in payment for the steamer the defendant issued to the plaintiff and his assignors three certificates of the following tenor:

“Received of F. A. Smith $3,000 for investment on my own judgment, I to have one half of net profits, principal and 6 per cent interest guaranteed. Money subject to withdrawal at any time on sixty days ’ notice. Report to be made monthly.

“Empire, Oregon, April 25, 1910.

“ [Signed] ■ L. D. Kinney,

“Proprietor.

“George M. Everett,

“Cashier of Pool.

“E. R. Peterson,

“Secretary of Pool.”

Reverting to the allegation of the complaint quoted, it will be observed that there is no statement that any profits had actually been earned. It is only there said that the defendant represented that the certificate had earned $3,000 in addition to its face. This allegation was denied, and hence in any view of the case it became necessary for the plaintiff to prove it. The only testimony on that subject is to the effect, as stated by the witness McLain, that after the issuance of the first certificate the defendant called the witness into the former’s office at North Bend. His testimony continues in this language, referring to the defendant:

“He said that these old certificates were issued on a valuation of $125 each on the lots in that pool, and he had changed the valuation, doubled the valuation, and he was going to call in the old certificates and issue new certificates for double the amount on account of the raise of all the lots, by his own request.”

This does not amount to proof of the allegation that the defendant represented the certificate to have earned $3,000, much less does it amount to proof that any profits had been made on the supposed investment. All that it amounts to is that the defendant arbitrarily inflated his paper by 100 per cent. Laying aside the strong flavor of usury with which the transaction is tainted and the enormity of doubling the actual indebtedness for the investment in the vessel, it is apparent that the court erred in directing a verdict according to the prayer of the complaint, because the testimony did not prove the disputed allegation.

For want of a proper bill of exceptions we decline to consider whether or not the defendant was entitled to prove his allegation of the fraud which induced him to assume the obligation of paying for the steamboat, as well as the other questions assigned as errors.

The judgment is reversed and the cause remanded for further proceedings.

Reversed. Rehearing Denied.

Motion to Retax Costs Allowed.

Mr. Chief Justice McBride, Mr. Justice Moore and Mr. Justice Ramsey concur.

Denied September 22, 1914.