November 10, 19115. 



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Pertinent Legal Findings 



Querien on questions arisinp on any points ininlring the law as it is applied to lumterinfj and allied industries toillhe given proper 

 rt attention through this department if submitted to Hardwood Record. There xoill le no charge for such service, but HhBOWooD 

 JKD reserves the right to publish questions and answers without designating names or location of inquiries unless specifically requested 

 tlo do so. 



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not do do so 



Extent of "Sawmill" Liens 



A law in force in Georgia provides tliat "all persons furnishing 

 sawmills with timber, logs, provisions, or any other thing necessary 

 to carry on tho work of sawmills shall have liens on said mills and 

 their products. ' ' Applying this statute, under the well settled rule 

 that statutes purporting to give liens must be strictly interpreted, the 

 Georgia court of appeals decided in the recent case of Joseph Hull 

 & Co. vs. Anderson Lumber Company, 86 Southeastern Eeporter, 257, 

 that no lien is allowed on any property by the law excepting ' ' sawmills 

 and their products." The court holds that mules used in carrying on 

 a sawmill business cannot be regarded as a part of the mills under 

 the lien law. The opinion says: "The word 'sawmill' does not include 

 any detached personalty, such as vehicles, draft animals, etc." 



Responsibility for Injury to Driver 



A lumber company which faUed to equip a two-w'heelcd lumber 

 truck with a brake is liable for injury to the driver, resulting from 

 the truck swinging around as he was driving it down an incline, due 

 to heaviness of the load and fractiousness of the team furnished him. 

 The case falls within the Oregon statute which requires employers 

 to adopt proper measures for the safety of their employes. (Oregon 

 supreme court, Davis vs. Carlton Lumber Company, 151 Pacific Re- 

 porter, 650.) In another suit against the same company, defendant 

 was held liable for injury to another driver who was struck by an 

 overhead mono-rail transfer while driving along a dock and while his 

 attention was diverted. Liability in this case was predicated on 

 maintenance of the overhead obstruction too close to -the roadway 

 and failure to equip the wagon with a brake and the harness of the 

 horses with breeching. (151 Pacific Eeporter, 652.) 



Demurrage Under Water Shipment 



Two points which are apt to arise under almost any charter of a 

 vessel to transport lumber were involved in the case of Wallace vs. 

 Cargo of 292,000 feet of pine boards, 224 Federal Eeporter, 994, 

 passed upon by United States District Court in New York. 



The charter provided a fixed amount as compensation for carrying 

 the cargo and also $30 per day for ' ' detention ' ' of the vessel. After 

 unloading was completed, bill for "water freight" was presented to 

 the consignee, who subsequently issued a check for the amount, with 

 an indorsement on the back, "in fuU for all freight." The court 

 holds that, although ordinarily charges for both hire and demurrage 

 would be presumed to be included by the term "freight," a receipt 

 for ' ' freight ' ' charges does not prevent subsequent claim for demur- 

 rage, when, as in this case, the circumstances indicate an intention 

 of the parties to draw a distinction. 



Speaking of the time for unloading before demurrage accrued, the 

 court said: 



The parties having made a definite charter, and having left out o£ consid- 

 eration any rules prevailing in the harbor of New York (the destination), 

 and each party standing strictly upon the charter, it must be assumed that, 

 if the vessel was ready for discharge at 1 o'clock p. m. upon the day after 

 her arrival and reporting, the time would begin at that hour on November 

 11, and the testimony Indicates that delivery did begin at that time. 

 The language of the charter party is that lay days are to commence from 

 the time the vessel is ready to discharge cargo, and that cargo is to be 

 received at the rate of 35 M per day in New Yorls. Under the laws gov- 

 erning the interpretation of contracts, as well as the statutory regulation 

 of conduct, the absence of any exception or provision for work caused by 

 necessity would lead us to assume that the statute of the state, treating 

 Sunday as a day not to be devoted to work, would be considered implied, 

 even in a contract as strict as the one in question. Therefore the first 

 Sunday, or the Sunday within the lay days, must be excluded. The time 

 lost upon a rainy day would, however, come within a period which was 

 being estimated from the rate of discharge at the rate of "35 M per day." 

 The fraction left by dividing 292,391 feet by "35 M" is substantially near 

 enough to SVo to give the consignee at the charter rate of discharge until 

 the evening of Friday, November 20. Detention for which demurrage is to 

 be given is to be measured by time, rather than working days ; hence the 

 libelant is entitled to collect from Friday evening until Monday evening, or 

 three days. 



Federal Taxes Against Lumber Companies 



An incorporated lumber manufacturing company, in making a return 

 of its assets under the federal corporation tax law, was entitled to de- 

 duct from its gross receipts, as capital assets, the market value of 

 the standing timber from which was manufactured the lumber sold 

 during the year for which the return was made, computed as of the 

 time the tax law took effect, although the timber was bought several 

 years before and had since been carried on the company's books at 

 its actual cost. The company was also entitled to deduct the proceeds 

 of lands sold during the year up to the value of the lands at the time 

 the law took effect. (United States district court, western district 

 of Michigan; Mitchell Brothers Company vs. Doyle; 225 Federal 

 Eeporter, 437.) 



In this suit plaintiff was permitted to recover taxes paid under 

 protest. Plaintiff claimed that its standing timber and other prop- 

 erty were capital assets, and that the portion. of the proceeds derived 

 from cutting, manufacturing and selling such timber, measured by the 

 actual stumpage value, did not constitute income, and therefore 

 should be deducted. Tho commissioner of internal revenue conceded 

 the right to deduct the original cost of the timber, but denied the 

 right to make any deduction on account of increase in value. The 

 Attorney General denied the right to make any deduction, contending 

 that all the proceeds of the manufactured lumber were taxable. As 

 above indicated, the court took a still different view, which com- 

 mends itself as being fair, by holding that the taxable proceeds should 

 be computed by deducting the market value of the timber from 

 which the lumber was cut as of the time when the tax law took 

 effect. 



Liability for Delaying Lumber 



Even though a contract to sell and deliver lumber at a distant 

 point makes time for delivery a special consideration, the seller 

 \vill be excused for delay in delivery if the buyer's order was ac- 

 cepted on an express understanding that "all agreements are con- 

 tingent upon strikes, accidents, delays or carriers and other delays 

 beyond our control." (Massachusetts supreme judicial court, Durden- 

 Coleman Lumber Company vs. William H. Wood Lumber Company, 

 109 Northeastern Eeporter, 648.) In this case plaintiff's delay in 

 delivery was excused on the ground that it had taken every reason- 

 able precaution to expedite delivery, but that stormy weather pre- 

 vented prompt hauling of logs to some of the mills and loading 

 of the lumber, and that further delay was occasioned by failure of 

 a railroad company to promptly provide cars. 



It is further decided that even if plaintiff had inexcusably delayed 

 delivery of the lumber, defendant could not have offset against 

 the price damages based upon loss sustained on account of the delay 

 by a third party to whom the lumber was resold by defendant, in the 

 absence of any showing that defendant had paid the amount of such 

 damages or been sued on account of them. 



Extension of Time for Cutting Timber 



Since it is the policy of the law to avoid forfeiture of contract 

 rights unless plainly required by existing circumstances, the North 

 Carolina supreme court decides that under a sale of standing timber 

 with privilege in the buyer to remove the same within a period of 

 ten years, subject to an option in him to an extension of the time 

 from year to year for five more years, on notice and payment of $25 

 annually, where the time was duly extended for four years, the seller 

 could not forfeit the right to the fifth year extension because there 

 was a delay of four days in paying the last $25, especially where 

 notice was given at the end of the ten years that the option for the 

 five years would be exercised and the full $125 was then tendered, 

 it being at that time refused on the ground that the option could be 

 exercised from year to year only. (Bangert vs. John L. Eoper Lum- 

 ber Company, 86 Southeastern Eeporter, 516.) 



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