UNITED STATES V. HElLNER
(Oircuit Oourt, 1.
January Hi, 1886.)
MEASURE OF DAMAGES IN ACTION FOR THE CONVERSION OF TIMBER·.
An innocent purcnaser; from a willful trespasser, of timber cut on the public land, is liable for the value of the timber at the date of such purchmle, including the value of all labor and expense which said trespasser had then bestowed upon it
CASE IN JUDGMENT.
H. purchased 50,000 feet of lumber at the mill of E., made from timber willfully cut from the public land by the latter, without the knowledge of H., and hauled the same to Baker City, a distance of 20 miles, at a cost of $5 per thousand, where. he disposed of it at $15 per thousand. Held, that in an action by the United States to recover damages for the conversion of said timber. the true measure thereof was the value of the lumber at the mill.
NEW TRIAL-INTEREST ON VALUE OF PROPERTY CONVERTED.
On the trial it was taken for granted that the lumber was delivered to the defendant at Baker City, and the jury took its value there as the measure of damages; but on a motion for a new trial, it being admit.ted that the defendant paid for hauling the lumber to that place, and no objection being made to the omission to prove that f&ct on the trial, a new trial was granted the defendant. unless the plaintiff would remit the cost of hauling, $250, less $120, the amount of three years' interest on the value of the lumber at the mill, which the plaiBtiff had omitted to claim on the trial.
Action to Recover Damages for Conversion of Timber. James F. Watson. for plaintiff. Lewis L. McArthur, for defendant. DEADY, J. This action was brought January 2, 1884, to recover damages from the defendants for the wrongful taking and cutting into boards of 400,000 feet of logs, belonging to the plaintiff, and wrongfully converting the same to their own use. It is alleged in the complaint that between June 1, 1881, and the commencement of this action, one O. T. Elliott wrongfully cut and removed from section 17, in township 7 S., of range 38 E. of the Wallamet meridian,-the same being then unsurveyed public land,-400,OOO feet of timber, made into saw-logs, of the value of $800, to a steam saw-mill in Baker county, Oregon, with intent to dispose of the same; that the defendants, well knowing the premises, took posse8sion of said sawlogs, then and there being of the value of $1,200, and wrongfully cut the same on said mill into boards, of the value of $4,800, and did then and there convert the same to their own use, to the damage of the plaintiff $4,800. On June 2, 1884, the defendants answered separately, denying, substantially, any knowledge of the allegations of the complaint relative to Elliott's cutting and removing timber from the public land; and admitting that on and since October 1, 1882, they each had an interest in the steam saw-mill situate on or near the section aforesaid, but that about said date it was removed to land belonging to the defendants; and denying that they were in any way interested in the
UNITED STATES V. HElLNER.
running of said mill between the time of acquiring said interests therein and its removal, or that they ever took possession of said logs, or sawed the same into lumber, or converted the same to their use. On the trial it appeared that in April, 1882, the defendant Heilner took a conveyance of the mill in question,-it being then located on the unsurveyed puhlic land, and on or near this section 17, and the same day leased it to said Elliott for so muoh lumber,-the transaction being, in fact, a mere security for the delivery to HeHner of lumthat ber in payment of money theretofore advanced by him to in the summer of 1882 there was received, under said arrangement, by HeHner, at Baker City, from forty to sixty thousand feet of lum· ber, made from logs cut and taken from aaid section 17 by said EI· liott, which was worth at the mill about $10 per thousand, and at Baker City, a distance of 20 miles therefrom, $15 per thousand; and that, although the defendants were then members of a mercantile firm at Baker Citv, the defendant Ottenheimer had no interest in the transaction. The jury found for the defendant Ottenheimer and against the defendant Heilner, and assessed the plaintiff's damages by reason of the premises at $750. Afterwards, counsel for Heilner made a motion for new trial, on the ground that the lumber was delivered by Elliott and received by the defendant at the mill, and the latter paid the cost of hauling the same to Baker City, which was $5 per thousand. This fact did noi appear on the trial, but the case was given to the jury on the supposition that Elliott delivered the lumber at Baker City. On this hypothesis, the jury, taking the mean of the eVidence-50,000 feet-as the amount of lumber received by Heilner, and its value at Baker City,-$15 per thousand,-properly assessed the plaintiff's damages at $750. But the district attorney now concedes that the defendant did receive the lumber at the mill, and paid for hauling it to Ba· ker City, where, presumably, it was disposed of by him, and finally converted to his own use. But he also contends that, Elliott being a willful trespasser, the defendant is not only liable for the value of the timber at the mill, including the value of the labor put upon it by Elliott, but for the full value of the property at any time after it came into his possession, and before this suit was brought for the con· version, which includes, of course. the cost of transportation from the mill to Baker City. The rule for ascertaining the damages in such cases has been a vexed question; the volume, if not the weight, of authority being that the value of the property at the time of conversion or appropriation to the use of the defendant, with interest thereon, consti. tutes the measure of damages. Field. Dam. § 792. But this includes any itccession of value between the taking and conversion. Blackstone (book 2, 404) says that t1e rule of the Roman law had been copied and adopted by Bracton, and confirmed by the courts of England, that if any property receives "an accession by natural or v.26F.no.2-6
artificial means, as by the growth of vegetables, the pregnancy of animals, the embroidering of cloth, or the conversion of wood or metal into vessels and utensils, the original owner of the thing was entitled, by his right of possession, to the property of it under such its state of improvement; but if the thing itself, by such operation, was changed into a different species, as by making wine, oil, or bread out of another's grapes, olives, or wheat, it belonged to the new operator, who was only to make satisfaction to the former proprietor for the materials which he had so converted." And in SilsbU1'Y v. McCoon, 3 N. Y. 379, the court went further, and held that when the taking was willfully wrong, it matters not that the species has been changed, the wrong-doer acquires no property in the article produced so long as it can be shown that it was made from the material converted, as when corn is made into whisky. But the· rule laid down in Wooden-ware Company v. U. S., 106 U. S.432, S. C. 1 Sup. Ct. Rep. 398, is of final authority in this court. In that case it was held that in an action to recover damages for tiniber cut and carried away from the public land, the defendant, if a willful trespasser, is liable for the full value of the property at the time of commencing the suit, without any deduction for any labor or expense bestowed thereon; but if he is an unintentional or mistaken trespasser, he is only liable for the value of the timber at the time of conversion, less the value of any such labor or and that a. purchaser from a willful trespasser, without notice of the wrong or the true ownership of the property, is only liable for the value thereof at the time of such purchase, and not for any labor or expense he may bestow upon it thereafter. It is admitted that the defendant purchased this lumber from a willful trespasser, and is therefore liable to the United States at least for the full value of the same at the time of such purchase. He bought and received the lumber at the mill, where it was worth $10 per thousand. If he purchased without notice that the property belonged to the United States, he is not liable for any additional value he may have put on it, before the suit was brought, by hauling it to Baker City; but if he had such notice, he is so liable. As to the knowledge of the defendant, there is no direct evidence, and the circumstances do not warrant any satisfactory inference on the subject. The objection that this point ought to have been made on the trial was not made by the district attorney, and may be considered wai ved. Probably he thought the defendant entitled to favorable consideration in this respect for the candid and truthful manner in which he testified when called as a witness by the United States to make out a case against himself, which is a matter of rather rare occurrence in cases of this kind, so far as my observatio\l goes. Assuming, then, that the defendant was not liable for the value of the lumber at Baker City, but only at the mill, the verdict should not have been for more than $500..
TRUE V. MANHATTAN FIRE INS. CO.
But, while revising this verdict, there is another circumstance that ought to be considered. The United States was entitled to interest on the value of this lumber from the time of the conversion, in the summer or faU of 1882, until the finding of the ,verdict,November 27, 1885. No claim for interest was made on the trial, or the court would have instructed the jury to allow the same. But, under the circumstances, I think it nothing more than right to provide that the interest which the plaintiff was entitled to recover be deducted from the $250, and the verdict considered as excessive only for the remainder. Three years' interest at 8 per centum per annum on $500 is $120, which, being deducted from $250, leaves a remainder of $130. The order of the court will be that the verdict be set aside, and the cause retried, unless the plaintiff, within 10 days hel'eof, enters a remittitur for the amount of $130.
OoZorado. August 6, 1885.)
FIRE INSURANCE-FoRFEITURE-AsSIGNMENT OF POLICY TO SECURE LOAN.
An assignment of a policy merely to secure a loan is not one which is forbidden in the usual prohibition against assignments, since the interest of the insured is not divested; and where such assignment is made with the company's consent. the re-assignment, upon payment of the loan, without consent, does not work a forfeiture, and the insured is entitled to recover.
Ruling on Demurrer. HALLETT, J., (orally.) True v. Manhattan Fire Ins. 00. is an action upon a policy of insurance. It is averred that the Manhattan Company issued to the plaintiff a policy upon certain property in Poncha Springs, and thereafter, and before the loss occurred, the same property was reinsured in the Phrenix Company. The defendants answered separately, denying the matters alleged in the complaint, and then setting up a separate defense that after the policy was made, and before the loss, plaintiff assigned and transferred his policy to his brother, whose Christian name is to the defendant unknown, which assignment was sanctioned and assented to by the Manhattan Company, and that the brother remained the owner of the policy until after loss occurred. To that the plaintiff replied that the assignment of the policy was to secure a loan made by his brother to him, which was then secured upon the property insured in and by said policy, and that before the institution of the suit the plaintiff paid off and discharged the loan which he had thereto1
From Insurance Law JQurnal. ,