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alleged that McGee at that tipe had any they had a stock of goods estimated in value creditors, nor that he was then in failing cir- by them at about $20,000, all of which was cumstances or insolvent, and that the prop- destroyed. They had insurance to
to the erty conveyed was all of the property possess- amount of $8,000; but, payment being reed by him at that time--facts necessary to be sisted, they compromised for $4,000 and realleged to make a case of constructive fraud. ceived that amount. With this sum, to which It is alleged that P. T. McGee was adjudged was added $2,000 borrowed by P. T. McGee a bankrupt on December 1, 1901, in the Dis- from the state school fund upon a mortgage trict Court of the United States for the Dis- of his and his wife's farm, they paid all of trict of Oregon, and "that the debts which
their debts and resumed business in a small are the basis of said claims filed against said
way. Desiring to change the manner in bankrupt estate were made and incurred at
which they had previously been doing their divers dates between the 1st day of January,
business, they incorporated the McGee Com1897, and the 1st day of December, 1901";
pany on November 19, 1897, with a capital of but, while that allegation may be true, it
$3.000; P. T. McGee, his wife, and son Hugh does not follow therefrom that any of the
being the incorporators—the former being the debts presented and allowed were incurred or
main stockholder, while his wife and son had existed on or prior to March 1, 1898, the date
only a nominal interest. The stock of goods, of the first deed. There must be alleged and
store fixtures, and the lots described in the proven facts out of which a constructive
deed were turned in to the corporation in fraud will arise by force of law, or facts con
payment for his interest in the stock; and stituting actual or expressed fraud. "And
to accomplish the transfer of the lots he and the rule is that the facts upon which fraud
his wife, on March 1, 1898, made the first is predicated must be specifically pleaded.
deed to the corporation which is assailed. A mere general averment of fraud is nothing
This deed was recorded on March 2, 1898. but the averment of a conclusion, and will
The store business was then conducted in the not suffice. It presents no issue for trial, and is bad on demurrer. Such an averment not
name of the corporation for some three or only renders the bill or complaint demurrable,
four years. On the 14th day of December, but it will not even sustain a decree." 20
1900. the corporation conveyed the lots by Cyc. 734; Leasure v. Forquer, 27 Or. 331, 41
deed to James T. McGee, another son. This Pac. 60). To avoid a deed as to future
deed was acknowledged January 14, 1901, creditors, constructive fraud will not be suf
and was recorded January 17th following. ficient, but express fraud is essential. “If a
The consideration expressed therein is the creditor assails a conveyance made before
sum of $1,000, which the grantee swears he the debt was contracted, be must as a rule
paid the corporation in money, by having allege and prove that the conveyance was
loaned to it at some time previous thereto the made with the intent to put the property be
sum of $200, and at another time $400, which yond the reach of creditors with whom the amounts the corporation was owing him at grantors intended to deal upon the faith of
the date of the making of the deed, and the his owning the property transferred, and balance of the consideration, namely $100, he that upon that faith he did contract debts
paid the corporation at the time of receivwhich he did not intend to pay" (20 Cyc. 738), ing the deed. This testimony is corroborated or that "the transfer was made with a view by P. T. McGee, and we do not find anything of entering into some new and hazardous in the record tending to rebut it. P. T. Mcbusiness, the risk of which the grantor in- Gee continued to occupy the premises, living tended to be cast upon the parties having in one of the old buildings thereon, and rentdealings with him in the new business. Such ing and collecting and receiving the rent conveyance is fraudulent as to subsequent from the other buildings, giving the receipts, creditors and may be attacked by them. sometimes in his own name, and at other However, a mere expectation of future in. times in the name of James T. McGee, his debtedness, or even an intent to contract son. In one instance he executed a lease to debts, if it be only an intent, not coupled another in his own name for a portion of the with a purpose to convey the property in premises. The rents were used by P. T. Mcorder to keep it from being reached by the Gee in making repairs and for his personal creditors, will not make the deed invalid as expenses; but for a short time James used against such future creditor.” 20 Cyc. 423. and occupied a part of the premises for a
We do not find such averments in the com- blacksmith shop and built a shed or addiplaint, nor any evidence in the record tend- tion to one of the buildings, in which he ing to prove any of such requirements. The stored for a time some farm machinery. facts which we gather from the record are James and his father both swear that the about as follows: For many years prior to latter was allowed to occupy a portion of the March 1, 1898, the date of the first deed, P. premises, which had always been his home, T. McGee had been engaged in a general and to manage and rent the remainder, and merchandise business at Myrtle Creek, with to keep the rents as an offset and exchange his son Hugh as an associate. In 1895 their for the rent of the farm belonging to P. T. sture was destroyed by fire, at which time McGee and his wife, which James was living upon without the payment of any other rent; country merchandise store and to buy and and it also appears that James always paid sell real property. The offering of the certithe taxes upon the property in controversy. fied copy of the articles of incorporation Some time after the conveyance by the cor
makes a prima facie case of the legal existporation to James of these lots it ceased to ence of such corporation and of its right to do business, and P. T. McGee resumed busi- do the business mentioned in the articles. ness in his own name, and it was during that Sess. Laws 1905, p. 111. P. T. McGee swears time that most of the debts now claimed that the corporation was fully organized, against him were incurred. On the 9th day with a full complement of officers, and that of November, 1904, he filed his voluntary peti- it conducted a general merchandise business tion in bankruptcy in the United States Dis- for several years. This, taken with the fact trict Court of the District of Oregon. Plains that the corporation executed, by Hugh Mctiff was appointed his trustee and qualified. Gee, as its president, and P. T. McGee, as Claims to the amount of about $1,500 were its secretary, the deed conveying the premises presented to the referee, and most of them to James, shows that it has attempted to were allowed; but of these none were incur- do the business which it was authorized by red prior to March 1, 1898, the date of the its charter to do, and this established it at insolvent's deed to the corporation, and the
least as a corporation de facto, so that the only debts which were incurred by McGee legality of its organization cannot be inquired before January 21, 1901, the date on which into in any action other than by the state. he acknowledged for the corporation its deed
Marsters v. Umpqua Valley Oil Co. (Or.) 90 to James, are as follows: The claim of the Pac. 151. And it is well settled that a conAcme Harvesting Company for $57, wnich
veyance of property to or by a corporation was incurred September 29, 1900, and the de facto will be binding and valid as against
Finch v. Ullclaim of Edwin Weaver, dated January 3, all parties except the state. 1901, already referred to as not having been
man, 105 Mo. 255, 16 S. W. 863, 24 Am. St. ascertained and allowed by the referee in
Rep. 383. The corporation, then, having
taken the title to the lots in question by the bankruptcy at the time of the commencement of this suit and at the time of the taking of
deed to P. T. McGee and wife, executed on the testimony. All of the remaining claims
March 1, 1898, free from any fraud of the were incurred by McGee from one to three grantor, its title would not be affected by any years after the date of the corporation deed
of his subsequent creditors, unless the conto James. It also appears from the testimony
veyance is made with the intent to defraud that during all this time, and up to March
future creditors; but, as we have already 11, 1902, he owned his equity of redemption
seen, there is no averment in the complaint in the farm and four other lots in Myrtle
that P. T. McGee, when he and his wife made Creek, which were of considerable value; for
the conveyance, intended to deal with these
creditors in the future and to incur these on that date he mortgaged them to Kate Miller to secure the sum of $200. So that it subsequent debts on the faith of his ownerdoes not appear from the evidence that there
ship of the property in question, nor is there
any proof to that effect; nor is there any were any facts from which a presumption of
averment that when the conveyance was constructive fraud could arise, nor any tending to establish express fraud by McGee, enterprise, and that it was made so as to
made he was about to engage in a hazardous when making his deed to the corporation on
throw the burden of loss on his anticipated March 2, 1898. So that, if the corporation creditors, but the proof shows that, by conwas such a legal entity as to be capable of
veying the property to the corporation and receiving and conveying title to another,
the business being thereafter conducted in plaintiff must fail, unless a case may be made
the name of the corporation, the property of a reservation by P. T. McGee of some
was exposed to all the hazards of the busisecret interest or title in the property in
ness of the corporation, and hence it could fraud of his creditors.
not have been that such fraud was intended. Plaintiff alleges and centends that the Mc
The evidence, we think, shows quite clearly Gee Company was not legally organized as a
that, when James T. McGee took the title corporation; that no stock was taken or
from the corporation by its conveyance, he subscribed, and no officers were elected; and paid the consideration expressed in the deed. hence, he concludes, as a corporation it could and that there was no secret reservation of not contract for or purchase or take the title
any interest therein by P. T. McGee. The to real property, nor could it convey the title explanation of the subsequent possession of to another. But plaintiff offers in evidence a the premises by P. T. McGee is sufficient to certified copy of articles of incorporation of satisfactorily rebut any possible inference that the McGee Company, which appear to have might otherwise arise from such facts that been properly executed on November 29, 1897, | P. T. McGee had retained a secret interest and were filed with the county clerk and re- in the property. corded December 5, 1897, with power there- For these reasons, it follows that the dein conferred upon the corporation, among cree should be reversed, and one entered here other things, to run and operate a general | dismissing the complaint.
(50 Or. 156)
in 1886, some question arising between them BRATTAIN et al. v. COXX et al.
and Drinkwater. Brattain and others pur(Supreme Court of Oregon. Aug. 27. 1907.) chased the right to use the natural channel WATERS AND WATER COURSES-OBSTRUCTION of Small creek from him as a conduit OF Flow-MAINTENANCE OF DAN.
through which to convey water from the main Where complainants and their predecessors
channel of the river, through and across his in interest for more than 20 years had asserted and exercised a right each year to construct and
lands, with the right to enter thereon for maintain, whenever necessary, a temporary dam the purpose of enlarging or clearing the or obstruction in the main channel of a river to divert water into a creek for irrigation purposes,
stream from obstructions and placing and without any intimation from defendants or their
maintaining headgates therein and such othpredecessors in interest that complainants' right er work or works as may be foud necessary to maintain the dam was questioned, complain- to maintain and control the desired flow of ants acquired a prescriptive right to maintain
water. A few days after making this conit, notwithstanding defendants clandestinely and without complainants' knowledge at various
veyance to Brattain and his associates, times forcibly destroyed the works so main- Drinkwater conveyed the premises to Virgil tained.
Conn, who in October, 1989, sold and con[Ed. Note.-For cases in point, see Cent. Dig. vol. 48, Waters and Water Courses, $ 195.]
veyed to defendant George Conn, who has
ever since been the owner thereof. After Appeal from Circuit Court, Lake County;
the Drinkwater deed, plaintiffs or their predHenry L. Benson, Judge.
ecessors in interest continued to use Small Suit by T. J. Brattain and others against
creek and to maintain the dam in the main George Conn and another. From a judg
stream as before, without any expressed obment for complainants, defendants appeal. jections or protest from defendants or their Affirmed.
predecessors in interest, until 1902, when deC. A. Cogswell, for appellants. L. R. Web- fendants tore out the dam and by force prester and Joseph Simon, for respondents. vented plaintiffs from rebuilding it, where
upon this suit was commenced. It resulted PER CURIAM. This suit is brought by in a decree in favor of plaintiffs, and deT. J. Brattain and nine other landowners in fendants appeal. the Chewaucan valley, for themselves and
The only question involved is the right of other's similarly situated, to establish the
plaintiffs to construct and maintain a temright to maintain a temporary dam or ob- porary dam or obstruction in the Chewaucan struction in the Chewaucan river, at the river at the head of Small creek to increase head of Small creek, during low-water sea- the flow to 2.300 inches of water in such sons, for the purpose of diverting a portion creek during the low-water seasons. They of the water of such river into Small creek
claim this right by virtue of a grant from for irrigation purposes, and to enjoin defend- Drinkwater and by prescription. The deed ants from interfering with such right. The from Drinkwater to Brattain and his asChewaucan river is quite a large stream flow- sociates conveyed the use of Small creek as ing northeasterly through the town of Pais- a conduit for water from the main channel, ley. Just above the town it divides, and une with the right to place and maintain a headfork thereof, called "Small Creek," flows in gate therein, and "such other work or works a southeasterly direction, and from which
as may be necessary to maintain and control plaintiffs irrigate about 2.00) acres of land. the desired flow of water through said creek Prior to 1880, and while the 10-acre tract at channel"; and it can be fairly argued, in the head of Small creek, and through whichi view of the circumstances, this language was the main river flows, belonged to the state. intendeul to, and did. include the right to plaintiffs or their predecessors in interest construct a dam in the main river, as the entered upon and improved Small creek, for grantees lai theretofore done. But, howthe purpose of conducting water through it ever that may be, we think a prescriptive for irrigating purposes; and, as the natural right to maintain such clam is shown by the flow was not sufficient for their neeils dur- testimony. It clearly appears that for more ing the low-water seasons, they constructed than 20 years the plaintiffs and their predeand maintained, each year during that time, ressors in interest have asserted and exercisa temporary dam in the main river for the ell the right each year to construct and mainpurpose of diverting a portion of the water tain, whenever necessitry, a temporary dam into Small creek, thus augmenting the natur- or obstruction in the main channel of the al flow thereof. While they were so using river to divert from 2.00) to 2.500 inches Small creek and maintaining their dam, the of water into Small creek for irrigation land was conveyed by the state to one Riggs, purposes, and without any intimation from wl:0 subsequently sold it to lanchett, who defendants or their predecessors in interest conveyed it to Drinkwater in August, 1882. i that their right was questionel. It is true From the time of the conveyance by the state that defendant George Con testifies that he to Riggs, in 1840, and up to 18811. plaintiffs I often tore out and remove the sam, but useel Small creek as a part of their irriga- there is no evidence that plaintiff's knew of tion system, and maintained the dam re- this fact, or that it was done at a time when ferred to without objection from the land- they nee led the water. It was a clandestine owner, so far as the evidence discloses; but i and secret invasion of their rights, and we
December 15, 1896, and May 9, 1898. The complaint was filed May 7, 1904, at which time a copy of the summons was placed in the hands of the sheriff, but not served until March 9, 1933, when personal service was had and the summons filed. Defendants an. swered, denying the allegations of the complaint, and as an affirmative defense pleaded the statute of limitations. A reply being filed, placing the cause at issue, on June 28, 1903, a trial was had before a jury, resulting in a nonsuit. From a judgment thereon, plaintiff appeals.
C. M. Idleman, for appellant. S. B. Linthicum, for respondents.
do not understand that an entry by stealth and without the knowledge of the party in possession is sufficient to break the continuity necessary to constitute an adverse possession or to establish a right by prescription.
It is unnecessary for us to further review the testimony. It is sufficient that we have examined the record with care and find no reason why the decree of the court below should be disturbed.
Decree affirmed. (50 Or. 120)
DUTRO v. LADD et al. (Supreme Court of Oregon. Aug. 27, 1907.) 1. PLEADING-ANSWER-DEFENSES.
Under B. & C. Comp. $ 73, providing that an answer inay contain any new matter constituting a defense, and section 74, that defendant may plead as many defenses as he has, defendants, sued on an account for legal services, haying pleaded a general denial, were entitled also to plead limitations as an affirmative defense.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 39. Pleading, 88 18+-104.] 2. STATUTES-CONSTRUCTION.
Where the sections of a statute involved are all included in the same act, they must be construed together, and such construction be given, if possible, that each section may be effective.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 44, Statutes. $ 283.] 3. SAME.
Where the language is clear and unambiguous, it leaves no room for construction, and it becomes the duty of the court to adopt the meauing which it imports.
[Ed. Note.-For cases in point, see Cent. Dig. vol. 44, Statutes, $ 266.] 4. LIMITATION OF ACTIONS — COMMENCEMENT OF ACTION-FILING COMPLAINT-SERVICE.
B. & C. Comp. $ 6, provides that an action on contract must be brought within six years from the time the cause of action accrues. Section 51 provides that actions at law shall be commenced by filing a complaint with the clerk of the court, and that sections 14 and 15 shall only apply for the purpose of determining whether an action has been commenced within the time limited. Section 14 declares that an action shall be deemed commenced when the complaint is filed and the summons served, and section 15 provides that an attempt to commence an action shall be deemed equivalent to its cominencement, when the complaint is filed and summons delivered with the intent that it shall be served by the sheriff or other officer of the county in which defendants or one of them usually or last resided, if such attempt be followed by the first publication of the summons or service within 60 days. Held, that where, in an action on an account, the complaint was filed and the summons delivered to the sheriff for service 2 days before the expiration of the statutory period, but no service was had or publication begun until 10 months thereafter, the action was barred.
(Ed. Note.-For cases in point, see Cent. Dig. vol. 33, Limitation of Actions, $ 530.)
Appeal from Circuit Court, Multnomah County; J. B. Cleland, Judge.
Action by Thomas C. Dutro against William M. Ladd and others, as executors of the estate of W. S. Ladd, deceased, and another. From a judgment for defendants, plaintiff appeals. Affirmed.
This is an action to recover $5,000, attorney fees, alleged to be due plaintiff from defendants for legal services furnished between
KING, C. (after stating the facts). It is urged by counsel for plaintiff that defendant, by appearing and answering to the merits and denying the allegations of the complaint is not entitled to maintain his affirmative defense. It is settled that, where it does not appear from an inspection of the complaint that the remedy is barred, the same may be averred in the answer. Hawkins v. Donnerberg, 10 Or. 97, 06 Pac. 691, 908. B. & C. Comp. $ 73, provides that the answer may contain any new matter constituting a defense; and section 74, that the defendant may set forth by answer as many defenses as he may have. While this cannot be done where it appears that the defense is clearly inconsistent, there is nothing inconsistent in the defendant asserting he owes the plaintiff nothing and at the same time averring that the claim sued on is barred by the statute. The object of the law on the subject is to prevent the assertion of stale claims, whether with or without merit, thereby avoiding the oppressive results which would otherwise often follow after witnesses are unavailable, or after unavoidable events have transpired precluding the assertion of what might have otherwise been a good defense. It would therefore not be in harmony with the reason and spirit of the law to hold the statute unavailable merely because it may be alleged in the answer that the claim is without merit. Defenses may be deemed inconsistent only when they are so contradictory to each other that one of thein must necessarily be false. In this case, if the defendant did not owe plaintiff, yet, under the atfirmative allegations in the answer, the statutory bar is urged against him; while, if the claim is in fact meritorious, such time has elapsed since plaintiff's rights thereto matured as to constitute a bar to his remedy. Both may be true, and, if so, defendant should be permitted to frame his answer accordingly. Snodgrass v. Andross, 19 Or. 236, 23 Pac. 969.
The next question for determination is as to whether, under the facts admitted by the pleadings, plaintiff's claim is barred under B. & C. Comp. § 6, which provides that an action upon a contract or liability, express or implied, must be brought within six years from the time the cause of action accrues.
It is admitted by the pleadings, in effect, being admitted the summons was not served, that, while the complaint was filed 2 days filed, or in any manner attempted to be servbefore the expiration of the statutory period,
ed or filed, nor publication thereof attempted, the summons was not served nor filed until until 6 years and 10 months after the cause 10 months thereafter. It is provided by sec- of action matured, it necessarily follows that tion 51 that "actions at law shall be com- the action was not commenced within the menced by filing a complaint with the clerk time required. 1 Enc. Pl. & Pr. p. 136; of the court, and the provisions of sections Burns v. White Swan Mining Co., 35 Or. 14 and 15 shall only apply to this subject 305, 57 Pac. 637; Smith v. Day, 39 Or. 531, for the purpose of determining whether an 64 Pac. 812, 65 Pac. 1055. action has been commenced within the time Other points are suggested in the record, limited by the Code." It is also added that
but not urged here; nor do we deem them summons may be served on the defendant at
material. any time thereafter. Section 14 states that The judgment of the court below should an action shall be deemed commenced when be affirmed. the complaint is filed and the summons serv
(50 Or. 64) ed; and in section 15 it is provided that an
WOLF v. CITY RY. CO.* attempt to commence the action shall be
(Supreme Court of Oregon. Aug. 20, 1907.) deemed equivalent to its commencement,
1. TRIAL-WITIIDRAWAL OF TESTIMONY. when the complaint was filed and summons
Where the undisputed circumstances show delivered with the intention that it shall be the testimony of a witness cannot by any posactually served by the sheriff or other officer
sibility be true, it is the duty of the court to
withdraw such testimony from the jury. of the county in which the defendants or one
[Ed. Note.-For cases in point, see Cent. Dig. of them usually or last resided; "but such vol. 46, Trial, g 331.] an attempt shall be followed by the first 2. STREET RAILROADS-INJURY TO PERSONS ON publication of the summons or service there- TRACK-ACTIONS-EVIDENCE-SUFFICIENCY. of within 60 days.” It is conceded here that In an action for the death of plaintiff's inno service in person or attempted publication
testate, caused by his being struck by a street
car, evidence examined, and that of a certain of summons was made within that time, but witness for plaintiff hold not so opposed to all argued by plaintiff's counsel that there is a reasonable probabilities as to require its excludistinction between the “limitation" of ac
sion, as a matter of law, from the jury. tions and "commencement" of actions; that
(Ed. Note.-For cases in point, see Cent. Dig. sections 14 and 15 apply only for the purpose
vol. 44, Street Railroads, $$ 251-257.)
3. SAME_CONTRIBUTORY NEGLIGENCE OF PERof determining whether the action has been
SON INJURED. commenced within the time limited by the A person about to cross a street at a crossCode, and designates the relations only that ing is not bound to wait because a car is in exist between the defendants, specifying the
sight; but if the car is at such a distance that
he has time to cross, if it is run at the usual respective rights as between themselves; and speed, it is not negligence, as a matter of law, that these sections in no manner place any to attempt to do so. restrictions on section 51. The sections of [Ed. Note.-For cases in point, see Cent. Dig. the statute alluded to are all included in an
vol. 44, Street Railroads, $ 257.) act entitled "A bill to provide a Code of Civ
4. SAME-QUESTION FOR JURY.
Whether a speed of 26 or 29 miles an hour il Procedure," adopted in 1862. Being in
by a strect car at a much-used crossing is reacluded in the same act and adopted at the sonable is for the jury. same time, they must necessarily be consid- 5. SAME—CARE REQUIRED IN OPERATION. ered together, and such construction be giv
It is the duty of a street railway company, en thereto, if possible, that all the provisions
in operating its cars at street crossings, to use
ordinary care to avoid injury, regardless of of each of the sections may be made effect- whether the rate of speed has been limited by ive. State v. McGuire, 24 Or. 366, 33 Pac. statute or ordinance, or not. 666, 21 L. R. A. 478. We think, however,
[Ed. Note.For cases in point, see Cent. Dig.
vol. 41, Street Railroads, 8 172.] that the language is plain and unambiguous, leaving no room for construction; and when
That at the time a pedestrian was struck the language is clear we have no discretion
by a street car there were seven persons at or but to adopt the meaning which it imports. near the crossing authorized a finding that the Phelps v. Racey, 60 N. Y. 10, 19 Am. Rep. street was much used. 140. Section 51 clearly states that sections
7. SAVE. 14 and 15 of B. & C. Comp. can apply only
Principles of law governing the manage
ment of trains propelled by steam power and for the purpose of determining whether the
those propelled by electricity are not identical. action has been commenced within the time [Ed. Note.-For cases in point, see Cent. Dig. prescribed by the Code, and not for any oth- vol. 44, Street Railroads, $ 172.] er purpose. In any other case it is manifest 8. APPEAL-EXCESSIVE VERDICT-QUESTION OF
FACT. that the filing of a complaint is sufficient,
The refusal to set aside a verdict as exand the summons may be filed as there stat
cessive cannot be reviewed on appeal; the quesed, provided it be filed within the time lim
tion being one of fact, and not of law. ited, where the question arises as to wheth- [Ed. Note.-For cases in point, see Cent. Dig. er the action is barred by section 6 of the vol. 3, Appeal and Error, § 3864.] statute, in which event it is expressly pro- Appeal from Circuit Court, Multnomah vided that the service must be made within
County : Alfred F. Sears, Jr., Judge. 60 days from the filing of the complaint. It * Rehearing denied October 22, 1907.