text:
    The American Insurance Company vs. Coster and others.
    The master of a ship in a foreign port may, in a case of necessity, sell a part or hypothecate the whole of the cargo to repair the ship, for the purpose of enabling him to complete the voyage.
    Where the master is compelled to use his own private funds, or to take the property of a shipper, for the repair of the ship in a foreign port, the master or shipper has a lien upon the ship for the expenses of such repairs, although there is no actual hypothecation thereof.
    If an individual makes a voluntary loan to the master for the repair of the ship, and takes other security for the loan withput reserving to himself a lien upon the ship, the lien is waived.
    The lien upon a ship, for repairs furnished in a foreign port, must be enforced within a reasonable time, or the ship will not be liable therefor in the hand» of a bona fide assignee.

      May 28.
    But it will be sufficient, if the party entitled to the lien proceeds to enforce it within a reasonable time after the termination of the voyage upon which the repairs were made, and before the ship sails up.on a second voyage.
    The ordinary mode of obtaining the benefit of a lien on the ship, is by a proceeding in rem in the instance court of admiralty. But where the court of chancery has the-administration of a fund arising from a sale of the ship, in a suit for the settlement of the accounts between the joint owners, that court is authorized to take cognizance of such a claim, for the purpose of making an equitable distribution of the proceeds of the ship.
    Where several persons had a joint interest in a ship and cargo, in the nature of a limited partnership, and an insurance company loaned money to one of the partners, with the assent of the copartners, upon respondentia upon his interest in the ‘cargo only, and a part of the cargo was afterwards sold by the master for the repair pf-the ship ; Held, that the insurance company was entitled to claim a remuneration pro tanto out of the proceeds of a sale of the ship.
    Where defendants are brought before the court as merely formal but necessary parties, and without any fault on their prrt, they may sometimes be entitled to their costs against the complainant; and he will in that case have his remedy over for those costs, against the other defendants who have rendered the litigation necessary.
    The bill in this cause was filed by the complainants to obtain a portion of the proceeds of the sale of the ship Adonis. The cause was heard upon bill and answer, as to the defendants who had any real interest in the controversy. The facts, as they appeared from the pleadings, were-as follows : About the first of March, 1822, the defendants, J. G. Coster and R. M. Lawrence, together with J. Jones and J. Clinch then composing the firm of Jones & Clinch, and W. C. Barker and R. Hopkins, partners under the name of Barker & Hopkins, agreed to undertake a mercantile adventure to Calcutta, and thence back to New-York, Each of the parties were to contribute and advance their proportions of the cost and outfit of the ship and cargo, upon their own account and responsibility, and on the return of the ship to New-York she was to be sold and the concerns of the adventure closed. The firms of Jones & Clinch and Barker & Hopkins each contributed $12,500 for their respective proportions of the cargo; which sums they borrowed of the complainants, on respondentia, upon the goods and specie laden or to be laden on board the Adonis on account of the borrowers at any tune during the intended voyage. The respondentia bond was dated the 18th of March, 1822, and was executed by all the members of the two firms, jointly and severally. And by an agreement signed by them, reciting that the bills of lading for the goods, &c. mentioned in the bond were to be assigned to the complainants as a further collateral security for the loan, it was stipulated that such assignment should not exonerate the obligees from personal responsibility, or" compel the complainants to accept the goods in discharge of their debt; and that if the money was not paid on the arrival of the goods at New-York, or within two months thereafter, the complainants might then sell them at auction, and credit the proceeds on the bond. Goods to the amount of $38,882,05 were laden on board the ship, in which goods the share of each firm was $12,500, Coster’s share $10,000, and the share of Lawrence was $3882,05; and their respective interests in the ship were in the same proportion. It was also agreed between all the partners, that at the termination of the voyage, the profits or loss of the adventure should be borne by them in the same ratio. On the 30th of March, a bill of lading of the cargo was delivered to the complainants, with an endorsement thereon, by Barker & Hopkins and Jones & Clinch, assigning their interest in the same and in the goods therein mentioned, and in the goods to be invested or procured therefrom, and also in the return cargo, as collateral security, according to the agreement endorsed on the respondentia bond. Coster and Lawrence knew of the arrangement relative to the loan from the complainants, and the manner in which it was secured; but they had no personal interest therein, except such as arose from the joint ownership of the ship and cargo. The Adonis sailed from New-York in April, and arrived at Calcutta in July, 1822. The ship sustained sea damage on the voyage; and for the repairs thérof at Calcutta, after exhausting the other funds of the owners, the master was obliged to appropriate $4701,49 of the proceeds of the outward cargo. In August, 1822, during the absence of the ship, Jones & Clinch became insolvent, and assigned their interest in the ship and cargo to F. H. Nicholl and N. Scovill, in trust for certain of their creditors. Barker & Hopkins also became insolvent about the same time, and Hopkins died shortly afterwards. On the 20th of August, in the same year, Barker, as the surviving partner, assigned the interest of that firm in the ship and cargo to B. Chase and R. McQueen, in trust for certain creditors of that company. The ship arrived at New-York'with her return cargo the-latter part of March, 1823. Shortly thereafter an arrangement was made between the complainants and the former owners of the ship and cargo and their assignees, by which the cargo was sold and the proceeds thereof distributed between Coster, Lawrence and the complainants, according to their original interests in the outward cargo; the complainants taking the shares of Jones & Clinch and Barker & Hopkins. But the sums thus received by the complainants fell considerably short of the ani'ount due to them on the respondentia bond, leaving the deficiency much greater than it would have been had not a portion of the proceeds of the outward cargo been taken for the purpose of repairing the ship. By another agreement between Coster & Lawrence and the assignees of Jones & Clinch ana Barker & Hopkins, made about the same time, the ship was placed in the hands of Coster to be sold. The complainants gave notice to him of their claim upon a part of the proceeds of the ship, to remunerate them for their interest in that part of the proceeds of the outward cargo which had been appropriated by the master for repairs. But Coster, being indemnified by the assignees, sold the ship and paid over to them their share of the proceeds, after adjusting certain unsettled accounts relative to the adventure. Barker died insolvent, and his personal representative was made a defendant. Jones & Clinch were discharged under the act to abolish imprisonment for debt in certain cases, and their respective assignees were also made defendants in this suit.

      J. JDuer, for the complainants, contended,
    1. That the complainants, by the investment of their funds in the repairs of the ship, acquired a lien upon her, or at least upon the "shares of Jones & Clinch and Barker & Hopkins, to the amount of the funds so invested, as well from the nature of their contract as by the general principles of maritime law.
    2. That the owners of the ship, all and every of them, were liable for the funds so invested, as for money paid to their use.

      3. That they were all and every of them liable for the tortious act of the master in applying the cargo of the complainants to the repairs of the ship when the property of the owners was under his control.
    4. That the defendant Coster was individually liable for paying over the proceeds of the ship, after "receiving express notice of the claim of the complainants. ■
    And in support of the points thus made by him, the counsel cited Taylor v. Plumer, 3 Maule & Selw. 562, 574; Abbot on Shipping, last ed. p. 116, note, per J. Story, n. 125, n. 2; Amerigon Marit. Laws, 234; Com. Code, Book 2, tit. 1, art. 191; Cowp. Rep. 626; Farmer and another v. Davies, 1 Term, R. 109 ; Peters’ Adm. Dec. 223 ; O’Hara v. Ship Mary, Bees’ Adm. Rep. 100; 1 Wheat. 105; 4 Id. 443 ; 2 Gal. 345; 3 Mason’s Rep. 261; 3 Robinson’s Adm. Rep. 240, 264; American ed. 190. To establish the position that chancery had concurrent jurisdiction with the courts of admiralty, in cases like the present, the counsel cited 2 Pr. Wms. 367; Ex parte Shank, 1 Atk. 234; Halcott, 1 Ves. & B. 135; Hussy v. Christy, 13 Ves. 594.

      W. Slosson, for defendants Coster & Lawrence and Nichol & Scovill, contended,
    1. That the respondentia .bond and the hypothecation of the interest of Barker & Hopkins'and Jones & Clinch in the goods brought by them into the joint adventure, was subject to a prior right in those jointly concerned in the adventure.

      2. That the cargo, in default of other resources, was the proper fund for the repairs of the vessel.
    3. That the appropriation of a part of the cargo to that object gave no lien to the complainants upon the vessel.
    4. That if there was a lien, it was subject to the prior rights of the other partners in the adventure.
    5. That the notice to Coster not to pay over the proportions of the proceeds of the ship belonging to the assignees of Barker & Hopkins and Jones & Clinch was inoperative, and could not subject him to responsibility, as the assignees were entitled to the possession of such proceeds.

      6. That Richard M. Lawrence, who has merely received his proportion, was not liable to the complainants.
    7. That John G. Coster, for the like reason, was not liable, in respect of his own proportion ; nor was he liable for the proportions paid over by him to the assignees of Barker & Hopkins and of Jones & Clinch.
    8. That Nichol & Scovill, the assignees of Jones & Clinch, were not liable; the assignment to them being of the ship on which the complainants had no lien.
    And in support of these points, the counsel cited Laville v. Robinson, 4 D. & E. 720; Gow on Part. 31 and 33; Post v. Kimberly, 9 John. R. 488, 9; 3 Kents Comm. 13; 1 Wash. C. C. 49 ; Whar. Dig. 539, sec. 34 to 42 ; Hussy v. Christy, 13 Ves. 596; Hussy v. Christy and others, 9 East, 426; Depau v. Ocean Ins. Co., 5 Cow. 63. As to the point that the complainants’ lien, if any, could only be enforced in a court of admiralty, the counsel cited Novion v. Hallet, (16 John. Rep. 327 ;) Le Caux v. Eden, (Doug. 594.)

      J. Fessenden, for Chase and McQueen, contended,
    1. That the respondentia bond and endorsement of the bill of lading mentioned in the bill, coupled with the appropriation of part of the proceeds of the outward cargo of the ship Adonis, to repair her abroad, did not give the complainants a lien-upon the ship ; and that they were nothing more than ordinary creditors of the estate of Barker & Hopkins, by reason of such appropriation and of any part of said bond’s remaining unpaid.
    2. That if the respondentia bond, &c. and the appropriation of a part of the outward cargo for repairs gave the complainants a lien on said ship, it was one which could only be enforced in a court of admiralty, by a libel against the ship; and that the court of chancery had no jurisdiction thereof.
    3. That the defendants Chase and McQueen were not, in any event, personally liable to the complainants for any thing.
    He cited 2 Black. Comm. 488. Dicky v. Ocean Ins. Co., 4 Cow. 222 ; Depeau v. Ocean Ins. Co., 5 Id. 63 ; Hussy v. Christy, 9 East, 426 ; and 2 Gal. R. 474 ; United States v. Bevans, 3 Wheat. 336 ; Martin v. Hunter’s Lessee, 1
      Id. 337; Houston v. Moore, 5 Id. 49 ; Thompson v. Brown, 4 John. Ch. R. 619.)
    C. jD. Sackett, for assignees of Jones, under the insolvent act.
   The Chancellor.

By the two several assignments to Nicholl & Bcovill and to Chase & McQueen, in August, 1822, they acquired the entire interest of the two insolvent firms in the ship Adonis; but as it has resulted, they took no interest whatever in the cargo, the whole of the share of the two firms in that being insufficient to discharge the complainants admitted lien thereon. Those assignees cannot, however, in any event, be personally liable to the complainants beyond the sums actually received by them out of the proceeds of the sale of the ship. If it had appeared that they were part owners of the ship, by the assignment, at the time the repairs were made, as the complainants’ property has-been taken by the master to make those repairs, in a case of necessity, they would have been personally liable as owners, independent of the question of maritime lien. The only evidence in this case, as to the time when the repairs were made, is, that the ship arrived at Calcutta in July and that the proceeds of the cargo were applied to pay for those repairs after that time. As the assignments were not made until the latter part of August, I think it may be fairly inferred that the application of the funds for repairs was made before the assignees became part owners of the ship. The assignees, however, took the right of the insolvents in the ship subject to any maritime lien, or equitable claim which existed against it at the times of then-respective assignments. It therefore becomes.necessary to. enquire whether any such claim or lien existed in favor of the complainants at that time.

By the maritime law, and the laws of most countries where the civil law prevails, a tacit hypothec or lien upon the ship, is given, without any express contract to that effect, in favor of a person who makes repairs, or furnishes funds to the master which are applied for that purpose, whether such repairs are made in a home port or abroad. (3 Kent’s Comm. 168.) The same doctrine once prevailed in the maritime courts of England; but after a long contest between the admimlty and the common law courts of that country, the latter finally succeeded in narrowing down the doctrine so far as to deprive the master of a domestic ship, or even of a foreign ship within the limits of an English country, of the power of hypothecating the ship for any purpose whatever. But I am not aware that it has ever been decided there that an express hypothecation of the ship is necessary to retain the lien in favor of the person who makes the repairs, or furnishes the means, on the credit of the ship, though some of the recent dicta of English judges seem to favor that supposition. (See 1 Haggard’s Adm. Rep. 325.) Lord Mansfield, however, held a different language on this subject, in Rich v. Coe, (Cowp. Rep. 639.) He there says, “ Whoever supplies a ship with necessaries has a treble security : 1. 'The. person of the master; 2. The specific ship; 3. The personal security of the owners.” And in the case of Farmer v. Davies, (1 Durn. & East, 639,) he is equally explicit in declaring the right to a specific lien on the ship itself for the repairs furnished. It is true Lord Kenyon afterwards expressed an opinion that this doctrine had been laid down by Lord Mansfield too generally. (7 Durn. East, 312.) But his doubts do not appear to have been founded upon the supposed necessity of an actual hypothecation, to obtain a lien on the ship; for he refers to a case before Sir Joseph Jekyll, in 1726, (2 Peer Wms. Rep. 367,) and another before Lord Hardwicke, in 1748, (1 Ves. sen. 155,) as the authorities opposed to the opinion of Lord Mansfield. By referring to those cases it will be found they turned upon the distinction between repairs made in an English port and in a foreign country. It must, therefore, have been in this respect merely that the language of Lord Mansfield was thought to have been too general; be not having noticed that distinction. In Ex parte Shrank, which came before Lord Hardwicke in 1754, (1 Atk. Rep. 234,) the distinction between foreign and domestic repairs was taken ; and it was admitted that there would have been a lien in that case, if the repairs had been.' ■ made in a foreign port while the ship was out on a voyage. Nothing, however, is there said as to the necessity of an express hypothecation of the ship by the master. It is true the usual practice is to give a bottomry bond. But the principal object of that-is to furnish the person, who has made the advances, or done the repairs, with written evidence of his claim, .and to enable him- to recover marine interest on the loan. Where the person making the repairs, or furnishing the means for that purpose, is in a situation to contract for and obtain an express hypothecation, there certainly can be no grounds of public policy against a rule which would require of him a compliance with that formality; provided that rule was generally adopted among maritime nations. And if he accepts other securityfor his loan,or contracts for a specific term of credit for the repairs, the presumption is against the existence of the lien, unless it is expressly reserved. So long, however, as the tacit hypothec is considered sufficient by nearly all the commercial nations of the world, it would probably be unwise and Inexpedient for us to adopt á different rule. We have gone far enough in following our English ancestors in their departure from the maritime law as to repairs in a home port. But in this respect the courts of this country have not thought it expedient to follow the English decisions which deprive the master of a foreign ship of the power to pledge the vessel for repairs in an English port. And several of our state legislatures have found it necessary, by statute, to restore the principle of the civil law, giving a lien in favor of the person making repairs upon a domestic vessel in a home port.

Whatever may be the law in England, as to the necessity of an express hypothecation to give a legal lien for repairs, or for means furnished for that purpose, by voluntary loan, in a foreign port, it cannot, in principle, be extended to a case where, from the very nature of the loan, it is impossible that there should be an actual hypothecation. - Such is in reality the case when the master is compelled to use his private property, or to expend his own funds, for the repair of the ship in a foreign port, or is obliged to take the property of a shipper for the same purpose in the nature of a forced loan. As the mas-

ter cannot, by an express contract, mortgage the property to himself in the first case, and the owner of the cargo, who is not present, has no opportunity to protect his own rights in the second, they must be without remedy as against the ship unless a tacit hypothec can be created by operation of law merely. In the case of Van Bokkelin v. Ingersol, in the court for the correction of errors, (5 Wend. Rep. 315,) I expressed my opinion as to the right of the master to a lien, both on the ship and freight, for supplies necessarily furnished by him in a foreign port for the purposes of the voyage.

It is well settled that the master, in a foreign port, under certain circumstances, may sell a part or hypothecate the whole of the cargo to repair the ship, and thus enable him to complete the voyage. (The Gratitudine, 3 Rob. Adm. Rep. 263. 3 Kent's Com. 173. Per Best, J., 5 Barn. & Ald. 619. Code of Com. art. 234.) In the case of Depau v. The Ocean Ins. Co., (5 Cowen's R. 63,) where a part of the cargo was sold at the port of necessity to repair the ship, the chief justice held that this created no lien on the ship for those expenses. If the cargo belonged to the owner of the ship, as in the case of Dickey v. The New-York Ins. Co. to which he referred, that dictum was certainly correct. But if it was supposed that a third person, whose goods were taken for the repairs of the ship in case of necessity, had no lien upon the ship to make good the loss, that opinion must have been expressed without a full examination of the law on this subject. Upon every principle of justice and equity, the owner of the cargo, whose property is thus taken for the benefit of the ship by way of a forcloan, has a right to look to the security of the ship as well to the individual responsibility of the ship owner for remuneration. It will also be found, on examination, that the rule the commercial laxv is in accordance with this principle of natural equity. By the laxvs of Wisbuy, the ancient capital Gothland in the Baltic, which now form the foundation of maritime laws of the north of Europe, a lien was given upon the ship in favor of the oxvner of the cargo whose property had been sold by the master for necessary repairs. (Laws of Wisb. art. 45. Cleirac, 176.) Although the marine ordinance of Lexvis the 14th did not in terms give such a lien, yet the master was, by that, ordinance, expressly authorized to sell part of the cargo for the necessities of the ship during the voyage. (Ordinance of 1681, Book 2, tit. 1. art. 19.) And as'the money thus raised was considered in the nature of a loan for the repair of the ship, the civil law gave the tacit hypothec, or implied lien. (Valin’s Com. Book 1, p. 343.) This lien is also directly recognized in the new commercial code of France, by which the damage sustained by the owner of goods thus sold is declared to be a privileged debt against the ship, and is placed next in order to the lien for seamen’s wages. (Com. Code, art. 191, sub. 7.) The same principle was contained in the Consolato del mare, although that decided, contrary to the opinion of Valin, that the ship owner was not personally responsible for the price of the goods sold, if the ship was after-wards lost before the termination of the voyage. _ Lord Stow-ell also seems to admit the lien upon the ship and freight, by implication of law merely, for the injury to the owner of the cargo by the sale or hypothecation of his goods; (3 Rob. Adm. Rep. 264;) and this principle has been more than once acted on in the courts of our own country. In the case of Bulgin v. The sloop Rainbow, (Bee’s R. 116,) the goods of the libellant, on a voyage from New-York to Charleston, were sold for the repair of the vessel at an intermediate port, the master having neither funds or credit at that place. Under such circumstances, the district court of the United States for the district of South Carolina held the vessel liable in consequence of the implied lien. And in the more recent case of The Ship Packet, (3 Mason’s Rep. 261,) Judge Story examined the question fully, and declared the existence of the tacit hypothec. It] then, we consider the original parties to this adventure as having an interest in the ship, as tenants in common, separate and distinct from their interest in the goods, upon a share of which the complainants held their security, I am satisfied the owners of the goods had an implied lien upon the vessel for that part of the proceeds of the outward cargo which was taken to pay the expense of repairs. The law in relation to such liens is, that they shall be enforced within a reasonable time, or the ship will not be liable in the hands of a bona fide assignee. But it is sufficient if the party entitled to the lien asserts his right, in the proper form, after the termination of the voyage in which the charge was incurred, and before the ship sails upon a second voyage. The ordinary mode of obtaining the benefit of the lien is by a proceeding in rem against the ship in the instance court of admiralty. But in cases where this court has the administration of the fund arising from a sale of the ship, in a suit for a settlement of the accounts between the joint owners, it may unquestionably exercise the right of settling all such claims for lien, so as to make an equitable distribution of the proceeds.

I do not consider this case, however, as depending strictly upon the question of maritime lien. Although each of the parties to the original adventure was to furnish their quota of the funds for the purchase of the ship and cargo, and upon their own responsibility, there was in fact a limited partnership between the parties, for the purpose of the voyage, both in the ship and cargo; and the sums paid by each, in the first place, was only in the nature of capital furnished for the adventure. By the terms of the agreement, both ship and cargo were to be sold, on the return of the vessel to New-York, for the purpose of ascertaining the profits of the adventure and distributing the proceeds thereof rateably, after deducting the charges incurred exclusive of the original investments. The complainants having taken their security for the $25,-000, loaned to Jones & Clinch and Barker & Hopkins, upon that part of their interests in the adventure which was vested in the cargo only, and with the knowledge and consent of the other copartners, they had an equitable right to insist that the part of the partnership fund on which they held their security should not be taken for the benefit of the ship, or be laid out upon other parts of the property in which they had no interest, so long as the rights of all parties could be protected by a different arrangement. As a part of the cargo was taken, to their injury, for the repairs of the ship, an equity arises in behalf of the complainants to have that amount restored to them out of the proceeds of the ship upon which the expense of repairs was properly chargeable. And the assignees took the assignments of that property, charged not only with the lien of the complainants upon the remainder of the cargo, under their respondentia bond and the assignment, of the bill of sale, but also with this equity as against their shares of the proceeds of the ship. All the expenses of the voyage, however, must be borne rateably by all the partners, or their assignees; and so much of the proceeds of the ship as are necessary for that purpose, and to equalize the expenses between the partners, should first be deducted, so that Coster & Lawrence may not be charged with any more than their just share of the expenses of the voyage. As to them, the owners of the ship and the owners of the cargo were the same ; and they have paid their full share of the repairs on the ship, by their interest in that part of the cargo which was appropriated for this purpose at Calcutta.

If the parties cannot agree upon the amount to which the complainants are entitled under this decision, it must be referred to a master to state the account and report the sums they are entitled to receive out of ihe proceeds of the ship, including interest from the time those proceeds were received by Coster. And there must be a decree against the defendant Coster for the payment of that amount, with interest from the date of the master’s report, together with costs. He having paid the money to the assignees and taken an indemnity, he will be left to his legal remedy against them or their sureties. If any balance remains due to the complainants after appropriating this portion of the proceeds of the ship to the payment of the respondentia bond, they may, if they consider it of any importance, have a decree for that balance against Jones & Clinch. But as both of those defendants have been discharged under the act to abolish imprisonment for debt in certain cases, the decree must be against their property only.

The assignees of Jones under the insolvent act were necessary parties; and being brought before the court without any fault on their part, it would, in an ordinary case, be correct to-give them their costs against the complainants, and to permit the latter to take a decree over against those defendants who have rendered this litigation necessary. (Weymouth v. Boyer, 1 1 Ves. jun. 426.) In this case, however, it appears the assignees of Jones have a fund in their hands, on account of the reserved dividend. I shall therefore leave them to pay their own costs out of that fund. And if the complainants do not obtain from the proceeds of the ship, under this decree, the whole amount, in reference to which that dividend was retained, the assignees must pay to them a proportionate share of such retained dividend.


source: Caselaw Access Project

author: The Chancellor.

license: Public Domain

text:
    Clarkson and wife vs. F. De Peyster and others.
    May 28.
    It is a good ground of demurrer to the whole bill, that a person who has no interest in the controversy, and has no equity as against the defendant, is improperly joined as a party complainant.
    Where the husband files a bill in relation to bis own rights, if his wife is a necessary party, by reason of a judgment or decree in favor of the husband and wife which is a lien upon the property of the defendant, and in a case where all the incumbrancers must be before the court, the wife may be joined with her husband as a complainant.
    The decision in this case was made upon a demurrer of the defendant F. De Peyster, to the complainant’s bill. The facts of the case are sufficiently stated in the opinion of the court.

      G. Sullivan, for the complainants.
    S. A. Talcott, for the defendants.
   The Chancellor.

The complainant Matthew Clarkson, has a mortgage, executed by the defendant J. F. De Peyster, on certain lands in the county of St. Lawrence; and as additional security for the same debt, he has an assignment, by way of mortgage, of 20 shares in the Tontine Coffee House, in New-York, subject to a prior lien in favor of the guardians of the infant children of H. A. Coster. The guardians also claim a prior lien on the St. Lawrence lands, as security for their debt from the defendant F. De Peyster. But it is alleged in the bill that they have, as a further security for their debt, a mortgage fromF. De Peyster, on certain lands belonging to him, in the city of New-York, and on certain other lands in Dutchess county. The complainants, M. Clarkson and wife, have also a decree in this court, which, by the issuing of an executian to the sheriff of the city and county of New-York, has become a lien on the interest of F. Be Peyster," in the property in that city, subject to the prior mortgage to the guardians. F. De Peyster demurs to the bill for want of equity against him; and also on the ground that there is a misjoinder of the claim of M. Clarkson, in his own right by virtue of the mortgage from F. Be Peyster, with the decree in chancery in favor of himself and wife against F. De Peyster. As this is a general demurrer to the whole bill, it must be overruled, if the complainants had a right to make F. De Peyster a party for any purpose whatever, unless the wife is improperly joined as a party complainant.

Where a person who has no interest in the controversy, and has no equity against the defendants, is improperly joined as a complainant, it is undoubtedly a good ground of demurrer to the whole bill. (The King of Spain and others v. Machado, 4 Russ. Rep. 225.) But in this case it is alleged that the defendants, who are guardians of the children of Coster, have four different securities for their debt which is due from F. De Peyster: 1. The New-York lands; %. The Tontine property; 3. The Dutchess county lands; and 4. Their claim to a priority, as against the St. Lawrence county lands. The object of M. Clarkson, as the holder of the mortgage, is to throw the debt of the guardians upon the first and third funds, so as to relieve the second and fourth upon which alone his mortgage is a lieu. To obtain a decree directing a sale of the New-York and Dutchess county lands in the first place to satisfy the debt to the guardians, so as to give Clarkson the benefit of this marshalling of the funds, F. De Peyster, as the owner of those lands and the mortgagor to the guardians, seems to be a necessary party. And he may be compelled to answer as to the situation of those lands, as well as to the other matters in the bill. For the reason before stated, it became necessary to make the other persons who had liens on the New-York or Dutchess county property parties to the suit. Here, however, a new equity arises. M. Clarkson and wife, by virtue of their decree and the execution issued thereon to the sheriff of New-York, obtained a lien upon the property of F. De Peyster in that city. But their decree was obtained before the revised statutes went into operation, and of course not being docketed, it was not a lien on the lands in Dutchess county, no execution being issued there. They have therefore an equity to throw the debt of the guardians on the Dutchess county lands only, in the first place, so a,s,to obtain the benefit of their execution lien on the New-Yofk property, or upon any balance of the proceeds of that property which may be left after satisfying the debt of the guardians. For this purpose the wife was a necessary party, as well as the husband. As he must be the complainant for the purpose of obtaining his separate rights under hi* mortgage, he and his wife could not be defendants to protect their joint rights under the decree in chancery. Neither could the wife, under such circumstances, he made a defendant without her husband, as to an equitable right in which he had a common interest with her! It then became a matter of necessity to join her with the husband as a party complainant.

A different state of facts may be presented upon the coming in of the answer of this defendant; but from what appears on the face of the bill, the demurrer is not well taken. It must therefore be overruled, with costs; and the defendant F. De Peyster must pay those costs, and answer the complainant’s bill in forty days, or an attachment may issue to compel an answer.


author: The Chancellob.

text:
    F. & N. Salters vs. Tobias and others.
    Under the insolvent law. of April, 1813, it was necessary that two thirds of the creditors residing in the United States should join in the petition, to . entitle the insolvent to a discharge from the debts due to his domestic creditors.
    A plea of a discharge under the insolvent act must distinctly state every fact which was necessary to give the discharging officer jurisdiction in the first instance.
    In the United States, where the legislative power is limited by written constitutions, a declaratory statute cannot have the legal effect of depriving an individual of a vested right, or of changing the rule of construction as to a pre-existing law.
    The recitals in an insolvent’s discharge are not the only evidence of the regularity of the proceedings; neither does an omission to state in the discharge the performanceof an act which was required by the statute to be done, raise a legal presumption that it was not done.
    May 28.
    Statutes which are intended to deprive creditors of all remedy for the recovery .of their debts should be construed strictly, and cannot be extended by implication beyond the fair and legitimate meaning of the terms used by • the legislature.
    This was a bill filed against a surviving partner, and the administrators of a deceased partner, to recover a debt due from the firm; it being alleged that the surviving partner was insolvent. The defence set up by the administrators, by way of plea, was that their intestate was discharged from his debts, in the spring of 1816, under the act of April, 1813, usually called the two thirds act. The plea, after stating that the debt was contracted in this state subsequent to the passing of that act, alleged that the testator, on the 14th of February, 1816, being an inhabitant of the city of New-York, and an insolvent debtor, in conjunction with so many of his creditors who had debts bona fide owing to them by the decedent as amounted at least to two thirds of all the debts and monies owing by him, in order to obtain a general discharge, did present a petition to the recorder of New-York, praying that his property might be assigned, &c. and that he might be discharged, both from his individual and partnership debts. That such proceedings were thereupon had that the insolvent complied with all the provisions of the act, and on the 7th of May, 1816, the recorder gave him a discharge from all his debts; which discharge was set out at length in the plea. The discharge recited that the insolvent, in conjunction with so many of his creditors residing within the United States, whose debts amounted to at least two thirds of all monies owing by him, whether in his individual or copartnership capacity, presented a petition, and at the same time delivered an account of his creditors and an inventory of his estate, &c.; setting out the proceedings at length. The discharge also recited, that the recorder was satisfied that the amount signed off amounted, in the aggregate, to two thirds of all the debts due to all the creditors of the insolvent, within and without the United States. The discharge was therefore general, as to all his debts.
    The plea was argued before the late chancellor, who made a decision thereon ■; but the decree not being settled while he . remained in office, and the parties not being able to agree as to the effect of that decision, the plea was re-argued before the present chancellor.

      T. T. Paine <§- J. Duer,

    for the complainants. We contend that the insolvent act of 1813 required that the petitioners, whose debts amounted to two thirds of all the debts due by the insolvent, should reside within the United States, in order to authorize a discharge of the insolvent. The insolvent act of 1801, in permitting three fourths of all the foreign and domestic creditors to petition for the discharge, opened the door to fraud. It enabled one domestic creditor to collude with the- foreign creditors, and to thus deprive the other domestic creditors of their debts. The effect of a discharge under the act of 1813, as to foreign creditors, if they did not unite in petitioning, was this : If there was not due to the petitioning creditors two thirds of all the debts, then the discharge did not affect the foreign debts; but if the foreign creditors united, so as to constitute two thirds, then their debts would have been discharged. The revised statutes are a legislative exposition of the act of 1813. (See note of revisors to sec. 2, tit. 2, chap. 5, 1 part of R. S.) Insolvent laws must be construed strictly. (5 Bacon’s Abr. 389. In the matter of Wendell, 19 John. R. 153.) It was long a question whether our insolvent laws did not violate the constitution of the United States. It has therefore always been required, before the discharge could avail the insolvent, that it be fully shown that the officer granting the discharge, had jurisdiction. A statute making a new provision on the subject of a former statute is not a declaratory act. (In the matter of Wendell, 19 John. 153. Dash v. Van Kleeck, 7 Id. 477.) An express averment should have been made in the plea, that two thirds in value of the petitioning creditors redded in the United States, in order to give the officer jurisdiction. (Roosevelt v. Kellogg, 20 John. R. 208. Servoss v. Heermance, 1 Id. 91.) After sufficient is stated to give the officer jurisdiction, it is not necessary to set out all the proceedings. (Frary v. Dakin, 7 John. 75. Wheeler v. Townsend, 3 Wendell, 247. Sallers v. Lawrence, Willes, 413. Turner v. Bealle, 2 Ld. Raym. 1263. Tully v. Sparkes, Idem. 1646.) The plea should also have averred that the petition was accompanied by the affidavits and accounts required by the act. This was also necessary to give the officer jurisdiction. It is a rule of pleading, that where the plea is susceptible of two constructions, the one most against the party pleading must be adopted. (1 Chit. Pl. 514, 522.) All the facts necessary to make the plea a complete bar must be ■ stated. If a replication should be filed to this plea, the issue would be whether two thirds in. value of all the creditors had petitioned for the insolvent’s discharge; not whether two thirds of the domestic creditors had petitioned. Averments are requisite to avoid intendments against the pleader. (Mitf. Pl. 240. Foster v. Vassall, 3 Atk. 586. Story v. Lord Windsor, 2 Id. 630.) The rules of pleading are the same in equity as at law. (Dobson v. Leadbeater, 13 Vesey, 230.) Every thing necessary to give the officer jurisdiction must be averred. (Wheeler v. Townsend, 3 Wendell, 247. Wyman v. Mitchell, 1 Cowen, 316. Bigelow v. Stearns, 19 John. Rep. 41. Cole v. Stafford, 1 Caines, 249. Lester v. Thompson & White, 1 John. R. 300.) The act of 1817 does not, apply to this case. The want of necessary averments in the plea is not supplied by the recitals in the discharge. The discharge is void upon its face, because it does not state the fact of which the officer must be satisfied before he directs an assignment; to wit, that the debts due to the petitioning creditors amounted to two thirds of all the U. States debts. In a statute where the intention is once clearly expressed, although subsequent words may contradict it, such construction will be adopted as will make all the parts consistent. (Hardness’ Rep. 84. Mallory’s case, 5 Coke, 112. Plowd. 365. Goodtitle v. Whitby, 1 Burr. 232.) The legislature must have had some object in altering the words of the law of 1801. That object must have been to remedy the then existing mischief—to deliver the American creditors from a dependence on the foreign creditors. As to the act of 1817, no legislature can pass a retroactive law, or impose a construction upon a previous law not warranted by law, which affects the vested rights of individuals. Where the meaning of the law has not been fixed'by judicial construction, the legislature may pass a declaratory law which will be entitled to great respect, but it cannot be binding upon the court.

      C. C. King $• W. S'losson,

    fcfr the defendants. The plea shows sufficient to establish the jurisdiction of the discharging officer. It is not necessary to set out all the proceedings in the plea. It is sufficient to state enough to give the officer jurisdiction, and then to allege generally that such proceedings were had, &c. and to set out the discharge. The act of 1813 has been complied with. Foreign creditors may unite in the petition, and if two thirds in value of the foreign and domestic creditors petition, the discharge will be valid. The act of 1813 was intended to give greater privileges than the act of 1801. New kinds of relief were intended by the act of 1813. If two thirds of the American creditors petitioned, and they amounted only to two thirds in value of the domestic creditors, then the discharge would have been from domestic debts only; but if the petitioning creditors amounted to two thirds of all the creditors, both foreign and domestic, then the discharge would have been from all the debts owing by the insolvent. The act of 1817, (Laws, p. 45,) is declaratory of the act of 1813. The power to give the discharge is the primary power; and the other, the petitioning for the discharge, is the secondary power, and must yield to the primary power. The words of the first section of the act of 1813 must be departed from, to effectuate the intention of the legislature as manifested in'the eighth section. If two thirds of all the debts, both foreign and domestic, were signed off, then the discharge was to be general ; but if two thirds only of the domestic debts were signed off, then only the domestic debts were to be discharged. The intention of the legislature, if it can be discovered, is to be carried into effect in all cases, if possible. (1 Kent's Comm. 431,2. Fitzg. Rep. 195.) The act of 1st March, 1788, was the original insolvent act. Similar provisions were contained in the act, of 1801. By the latter act, foreign as well as domestic debts could have been, discharged. The act of 1811 introduced a new system. It enabled the debtor to obtain his discharge upon his own petition. This act was repealed, and the law of 1813 was then passed. That act was intended to mitigate the severity of the laws against the debtor. It therefore allowed the debtor to obtain an alternative discharge—a discharge from all his debts, if two thirds of all his debts were signed off, and a discharge from his domestic debts, if only two thirds of the domestic debts were signed off. Where a law is ambiguous, the intention of the legislature may be declared by a subsequent law. In the case of Dash v. Van Kleeck, (7 John. R. 487,) the statute had received a judicial construction. Not so with the act of 1813. In Jackson v. Gilchrist, (15 John. R. 89,) it was held that the legislature could pass an act confirming conveyances by feme coverts. If so, they have power to pass an act confirming insolvent discharges. This is not a case of a law impairing the obligation of contracts, or an ex post facto law. The declaration of the intention of the legislature in a law is obligatory upon the court in all cases where the right is doubtful. -By the act of 1813,-the discharge is made conclusive evidence of the facts therein stated, and cannot be controverted. It may be impeached for fraud, but not for want of jurisdiction in the discharging officer. The discharge is conclusive evidence of the jurisdiction of the officer. (Jenks v. Stebbins, 11 John. R. 224.) At law it may be necessary to aver the jurisdiction in the plea; but it is not necessary in equity, where the discharge is set out in the record. The court will not require this technical averment, where the jurisdiction appears from the discharge itself. (Servoss v. Heermance, 1 John. R. 91. Frary v. Dakin, 7 Id. 75.) It is only necessary to plead sufficient to give the officer jurisdiction, and then to allege taliter processumfuit, See.
   The Chancellob.

The principal question in this cause is as to the true construction of the insolvent act of Í813. If it required two thirds of all the domestic creditors to petition, in order to obtain a valid discharge from domestic debts, then the plea is defective, in form at least, in not averring that the petition was presented by the insolvent, in conjunction with so many of his creditors residing within the U. States, whose debts amounted to two thirds. The recital in the'discharge states the fact to be so ; but that is not sufficient, in a plea, to show that the recorder had jurisdiction. It is now perfectly well settled, that the plea must distinctly aver every fact which was necessary to give the officer jurisdiction in the first instance. It must show that the petition was presented in the proper county, and that two thirds of the creditors joined therein. Arid these essential requisites in the plea cannot be supplied by mere recitals in the discharge. (7 John. R. 75. 1 Cowen's R. 316. 3 Wendells R. 247. 6 Id. 433.) Whether it is also necessary to aver that the account of the creditors and the inventory of the estate, &c. were presented at the same túne, and that the affidavits of the petitioning creditors were annexed to the petition as required by the statute, is a question which I believe has never been judicially decided in this state. That question was distinctly raised by the counsel on the argument, but the view I have taken of the main question in this cause renders it unnecessary to decide it at this time. If the defendants think proper to set up this discharge as a defence in their answer, they will then have ail opportunity to set forth any matters, not inconsistent with the truth, to show that the recorder had jurisdiction, and that the discharge was valid.

It is not necessary for the court to enquire whether the tenth section of the act of February, 1817, (Laws, 4 vol. 45, b) Was intended to be declaratory of what the act of 1813 originally meant, or only to change the construction of it for the future. The case of Sturges v. Crowninshield, (4 Wheat. Rep. 122,) which has been decided since that time, settles conclusively, that the legislature could not pass any law giving greater facilities to the debtor in obtaining his discharge, which would impair the obligation of any contract then existing, or authorize a discharge from such contract in a case where such a discharge could not previously have been granted. (Matter of Wendell, 19 John. Rep. 153.) In England, where there is no constitutional limit to the powers of parliament, a declaratory law forms a new rule of decision, and is valid and binding upon the courts, not only as to cases which may subsequently occur, but also as to pre-existing and vested rights. But even there the courts will not give a statute a retrospective operation, so as to deprive a party of a vested right, unless the language of the law is so plain and explicit as to render it impossible to put any other construction upon it. In this country, where the legislative power is limited by written constitutions, declaratory laws, so far as they operate upon vested rights, can have no legal effect in depriving an individual of his rights, or to change the rule of construction as to a preexisting law. Courts will treat such laws with all the respect which is due to them as an expression of the opinions of the individual members of the legislature as to what the rule of law previously was. But beyond that they can have no binding effect; and if the judge is satisfied the legislative construction is wrong, he is bound to disregard it.

Taking the first section of the insolvent act of 1813, (1 R. L. 480,) by itself, the language there used seems to imply that no one but a resident of the United States could be a petitioning creditor of the insolvent, and that the amount due to such domestic petitioning creditors should amount to two thirds of all the debts owing by the insolvent, whether foreign or domestic. The language of that section is, that the insolvent, in conjunction with so many of his creditors, residing within the United States, or the attorney of any creditor whose principal resides without this state, and within the United States, whose debts amount to two thirds of all the money owing by such insolvent, may present a petition, &c. But by referring to the fifth section of the act, it is evident the legislature only intended that the debts signed off by domestic creditors should amount to two thirds of the debts of the insolvent due to creditors residing within the United States; for the officer is directed to grant the discharge, if he is satisfied of that fact. It is apparent, from the language used in the fourth and eighth sections of the act, that the legislature contemplated that foreign creditors might also become petitioners, with reference to a discharge of the insolvent from his debts due to foreign creditors. At that tune it was supposed the discharge might be valid as to debts contracted out of the state. And there is no doubt it would have been effectual to discharge the debtor from all debts contracted within this state after the passing of the act, although the creditor resided out of the United States at the time of presenting the petition; provided two thirds of all the debts, foreign as well as domestic, had been signed off.

In giving a construction to this act, it must be borne in mind that the legislature not only intended to reduce the proportion of the creditors, who were to join in the application, from three fourths to two thirds, but they also intended to adopt a new principle, by making a distinction between American and foreign creditors. It is possible that the framers of the act intended to permit domestic debts to be discharged upon the petition of foreign creditors, provided the aggregate amount of debts signed off amounted tó two thirds of all the debts of the insolvent. But statutes of this description which are intended to deprive the creditor of all remedy for the recovery of an honest debt, must be construed strictly, and should not be extended by implication beyond the fair and legitimate meaning of the terms used by the legislature. Construing the act of 1813 by this rule, I am bound to say that it required two thirds of all the domestic creditors to join in the petition, to authorize a discharge of the insolvent from his debts due to domestic creditors; and that the tenth section of the act of February, 1817, if it required a different construction, introduced a change in the law which could not affect the rights of creditors as to debts previously contracted.

It may be proper to observe that if the recitals in the discharge are correct, two thirds of all the debts owing by the insolvent were signed off by creditors residing within the United States. And although the discharge recites no express adjudication of the recorder as to that fact, the defendants may perhaps be able to remedy the defect, by proper averments in their answer, and by the introduction of other proof. Although the discharge is made evidence of - the facts therein contained, it is not the only evidence that can be received to show the regularity of the proceedings. And the omission to state in the discharge an act required by the statute to be done, cannot even raise a presumption that such act was not performed. (Per Woodworth, J. 20 John. Rep. 211.) In this case the discharge does recite that the recorder was satisfied that the insolvent had conformed in all things to the matters required of him by the act.

As the plea is defective, in form at least, it must be overruled, with costs; but without prejudice to the right of the defendants to insist upon the discharge, by way of defence, in their answer.


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    Chapman vs. Munson.
    May 28.
    A vice chancellor is authorized to tax the costs in a suit or proceeding before any other vice chancellor. '
    Questions as to the regularity of the proceedings to get the costs taxed should be brought before the vice chancellor in whose circuit the suit is pending, - and not before the chancellor.
    The rule of the court allowing an application to the chancellor for a retaxation of costs in a suit pending before a vice chancellor, applies only to those cases where the amount of the taxable costs is in controversy; and not to a motion for a retaxation, upon the ground of irregularity in the proceedings of the adverse party.
    In a proceeding by petition for an attachment against a person who is not a party to the suit, the solicitor for such person is entitled to a retaining fee, if the petition is dismissed with costs. But a retaining fee cannot be taxed in his favor, against the adverse party, upon a mere collateral proceeding on such petition; as upon a reference for scandal or impertinence.
    Where a party is entitled to an order of course, he cannot charge the adverse party with the extra expense of a special application to the court for such order.
    Upon an order for the payment of costs, prospective costs can only be taxed for a copy of the order and of the taxed bill, to be served on the adverse party with the demand of payment.
    If costs are not paid within the time limited by the order, the party entitled to the costs may make-an ex parte application for an order to commit the delinquent to prison ; and all the costs subsequent to the demand can then he allowed, and will be inserted in the mittimus.
    This was an application for the retaxation of a bill of costs, taxed by the vice chancellor of the seventh circuit. Chapman presented, a petition to the vice chancellor of the fifth circuit, for an attachment against E. Munson for an alleged disobedience to a subpoena duces tecum in a suit pending before the last mentioned vice chancellor. On an affidavit that the petition was scandalous, the court made an order referring it to a master to inquire and report thereon. The master having reported the petition scandalous and impertinent, an order was made by consent that the improper matter be expunged, and that the costs of the reference be paid by the petitioner. The solicitor for E. Munson charged a retaining fee of $5, which was allowed by the taxing officer, together with other . Items objected to as improper.

      Chapman, the petitioner, applied to the chancellor for a re-taxation ; and, among other things, he insisted that the costs should have been taxed by the vice chancellor or taxing master of the circuit within which the suit was pending; and also that it was irregular to give notice of the taxation before the party against whom the order for the payment of costs was obtained had been served with a copy, of such order.

      T. Jenkins, for the petitioner.
    JV*. P. Randall, for E. Munson.
   The Chancellor.

The costs were properly taxed by Judge Mosely, although the proceedings were pending in the fifth circuit. The right of the vice chancellors to tax costs is given to them by statute, without restriction ; and the rules of the court are in conformity with this statutory provision. Any vice chancellor may tax costs, whether the proceedings in the suit in which the costs accrued are before the chancellor or any of the vice chancellors.

The question as to the regularity of the notice of taxation cannot be settled by the chancellor. This was a question with which the taxing officer had nothing to do. The only question for him to determine was as to the amount of costs to which E. Munson was entitled under the order of the court. The right to make an application directly to the chancellor to review the vice chancellor’s decision, in that respect, was given, by the rule, because it was deemed inexpedient to require one vice chancellor to correct the supposed error of another. But this reason does not apply to a motion for a retaxation on the ground that the proceedings of the adverse party have been irregular. In such cases, the application for a retaxation, or to set aside the proceedings for irregularity, must be made to the vice chancellor before whom the suit or proceed-ding is pending, in the same manner as if the costs had been taxed by one of the taxing masters.

The vice chancellor erred in this case in allowing a retaining fee on this interlocutory proceeding. As E. Munson was not a party to the original suit, and the application for an attachment against her was a new and distinct proceeding, it was probably a case in which a retaining fee for the solicitor might be allowed, after a final decision upon the application against her, if she obtained an order to dismiss the petition with costs. But the solicitor was not retained for the special purpose of getting this petition referred for scandal. That was a mere collateral proceeding, growing out of his general retainer to oppose the application for an attachment; and the retaining fee formed no part of the taxable costs of the reference.

The fee bill contains no allowance for a brief on a reference of this description. That item should not, therefore, have been allowed. The parties appear to have proceeded before the master, on the reference, by the service of a notice of hearing, instead of the ordinary mode by summons. As this course must have been acquiesced in by the petitioner, and the costs were in fact less than they would have been in the ordinary mode, I see no reasonable objection to the allowance of the notice and affidavit of service. It was a matter of course, under the 57th rule, to have an order to expunge the impertinent matter, and that the adverse party pay the costs. And as the solicitor thought proper to ask the court for a special order to that effect, instead of yvaiting till the order to confirm the report became absolute and then entering a common order, as he was authorized to do by the rule, the petitioner ought not to be charged with the additional expense of a brief and counsel fee. Those two items must therefore be disallowed. No prospective costs were properly taxable here, except for the copy of the order and of the taxed bill, to be served on the petitioner with the demand of costs. But upon an order for the payment of costs, if the costs are not paid within the time fixed by the order, the party who is entitled to such costs may immediately make an ex parte application to the court to commit the delinquent to prison ; and all the costs subsequent to the demand will then be allowed, and may be inserted in the mittimus.

I see no grounds for objecting to any other items of this bill to which exceptions are taken by the solicitor. There must be deducted from the bill as taxed, $14,88, including the charges for prospective costs; and the balance, $16,96, must be paid to the solicitor of E. Munson, within twenty days after service of a copy of the order to be entered herein; or she may apply to the vice chancellor, before whom the proceedings are pending, for an ex parte order to commit the delinquent to prison. The petitioner having succeeded only as to a part of the items excepted to, neither party is to have costs on this application.


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    Stebbins vs. The Phenix Fire Insurance Company.
    May 28.
    Where, by the charter of an incorporated company, the corporation [has a lien upon the stock of a debtor for the payment of his debt, stock which actually belongs to such debtor, though it stands upon the books of the company in the name of a fictitious person, is subject to the lien.
    If the charter or an authorized by-law of the corporation provides that' no transfer or assignment of stock shall be valid, unless made on the books of the company, an individual obtaining an assignment of stock from the apparent owner, but which assignment is not intimated on the books of the company, takes it subject to all the equitable rights of the company against the real owner thereof.
    If the officers of the company knowingly permit stock to be transferred to a mere nominal holder, and issue the scrip in his name, so as to make him the apparent owner, it seems that a bona fide purchaser of the stock from such apparent owner, even without a transfer on the books of the company, will be entitled to relief against the lien of the company for a debt due from the real owner.
    Where a legal transfer of stock can be made only upon the books of the company,^ person who gets an assignment of stock without such a transfer, obtains only an equitable title to the stock, which cannot prevail against a prior equity.
    The bill in this cause was filed to compel the defendants to permit a transfer to be made to the complainant, who was the cashier of the New-York Chemical Manufacturing Company, of twenty shares of the capital stock of the Phenix Fire Insurance Company, standing upon the books of the defendants in the namerof James Donaldson; and also for the payment of the dividends which had accrued on such stock. The cause was heard on bill and answer, and the facts as admitted or stated in the answer were as follows : The stock belonged to Charles Mo watt previous to the 19 th of May, 1825, and was on that day transferred by him on the books of the company to the name of James Donaldson, as a mere fictitious per- , son, to enable Mowatt, and others who were concerned with him in the deception, to place the name of such fictitious. person on their list of directors to be chosen as directors of the corporation at its charter election. A certificate was accordingly issued, signed by the president and secretary of the company and delivered to Mowatt, in which it was stated .that there were standing in the name of James Donaldson, on the books of their company, twenty shares, transferrable only upon the surrender of the certificate, and on the books of the company. Mowatt, as president of the company, without authority and in violation of his duty, afterwards appropriated the corporate funds to his own use, to the amount of $85,000; upwards of $45,000 of which was still due and not secured to the company. On the 27th of July, 1825, and after he had thus appropriated the funds of the defendants to his own use, Mowatt found a person by the name of James Donaldson, and obtained from him a blank assignment, and blank power of attorney to transfer the shares standing in that name on the books of the company. In July, or August, 1826, Mowatt being then indebted to the New-York Chemical Manufacturing Company, filled up the assignment and power with the name of the complainant as assignee, and inserted the name of B. P. Melick therein as the attorney to transfer the stock, and delivered the same to the complainant in payment of, or as security for that debt.
    The defendants refused to permit the stock to be transferred under this assignment and power, and refused to pay over the dividends to the complainant; insisting that they had a lien thereon for the debt due to them from Mowatt.

      W. T. Me Com,

    for the complainant. The Phenix Fire Insurance Company, it appears, made by-laws regulating the mode or manner in which transfers of stock were to be made; but' its by-laws do not and could not provide for or create a lien. The lien is given by the statute only; and by the terms of the statute, the claim or demand of the company must exist against.the “stockholder,” in order to authorize it to withhold or prevent the transfer. • The stockholder must be the person indebted to the company. Who, in the present case, was the stockholder 1 Most certainly James Donaldson. For whatever may be the equities, or the rightful ownership, as between Mnwatt and Donaldson, the defendants have by their own act made Donaldson the stockholder. They have vested the legal title in him, by issuing the certificate of the 19th May, 1825, in his name, and entering his name in their books as the owner. They have thereby recognized and adopted him as the stockholder, and are concluded by it. So held in Kane v. Bloodgood, (7 John. C. R. 108,109, 132.) The charter of this company knows of no other persons, as stockholders or owners of stock having authority to assign or pledge or vote on it, except those who appear on their books as stockholders. And in this instance, if the defendants intended to have these shares pledged or bound as a security for Mowatt’s debt, they ought to have procured some order or assignment from Donaldson ; and should not have permitted Mowatt to hold him out to the world by their books and by their certificate as absolute owner of the stock. It is contrary to every principle of justice to permit the defendants to avail themselves of the pretext of some secret trust between Donaldson and Mowatt, to defeat the rights of third persons dealing with that stock on the credit of the legal title, as declared by the defendants themselves. It is to be observed that there is no allegation or pretence that the defendants have any equitable lien in this case. As for instance, that the debt owing by Mowatt was contracted in the purchase of this stock, or upon the credit of it, or that it was pledged by Mowatt as security. On the contrary, they put themselves upon their strict legal rights, according to the provision contained in their charter. And if they do not bring themselves within the letter, it will not avail them.
    I propose to show, 1. That liens of this description for a general indebtedness, conferred by statute in favor of incorporated companies, are in derogation of the common law rights of stockholders, and are therefore to be construed strictly. Liens in law are of two kinds; particular and general. A particular lien is where money or labor has been expended on the identical article or property in possession. These are favored by the courts. (1 Atk. 228. Amb. 252.) General liens are claimed in respect of a general balance. “ These are viewed by the courts with a stem and watchful jealousy.” (12 Petersdorf, 255, n.) There can be only one construction of a contract, or of a usage, whether creating a lien or not, both in a court of law and a court of equity. ((Gladstone v. Birley, 2 diferir. 401.) Equity, therefore, will go no further in construing or extending a lien strictly legal, than a court of law. Liens in equity, or equitable liens, so called, of which courts of equity alone take cognizance, are of course an exception. I have already shewn that the lien claimed in the present case is not of the latter description. At common law, and independent of any statutory provision, the company would have no right to prevent the transfer of the stock on account of the stockholders’ indebtedness. In the case of Meliorucchi v. The Royal Exchange Assurance Company, (1 Eq. Cas. Abr. 9, pl. 8,) the assignees of a bankrupt filed a bill against the Royal Exc. Assurance Co. to compel them to assign shares in their stock worth £10,000 or £12,000. The defendant insisted that the bankrupt being one of the directors of the company, had, after the purchase of his stock, borrowed of the company £12,000, and that they ought not to let him transfer, without payment of the £12,000; and they claimed this by virtue of the 5th Geo. L, (allowing a set off in cases of bankruptcy, and declaring the balance only to be the actual debt.) But it was decreed at the rolls, and that decree, on appeal, was affirmed by the lord chancellor, that the defendants ought to permit the assignees to transfer and dispose of the stock ; and that the company could not stop or retain the stock for their satisfaction, either before, or by virtue of the 5th Geo. I. I would refer also, as elucidating this doctrine, to Gibson v. Hudson Bay Co. (1 Str. 645; 7 Viner’s Abr. 125, pl. 2.) We have, however, cases of our own on this subject, (Bates v. New-York Ins. Co. 3 John. Cas. 238, Sargent v. Franklin Fire Ins. Co. 8 Pickering, 90,) clearly shewing, that insurance companies have no implied lien on the shares of the stock, as security for debts due from the stockholders. The defendants are therefore thrown entirely upon the statute by which they are incorporated ; and I have already shewn they are not within the terms of the provision, with respect to the lien which they claim, because their debt or demand is not against Donaldson, the stockholder. And even admitting that Mowatt was the rightful owner of the stock, as between him and Donaldson, he had not the possession ; he was not the holder of the shares. He may have held the scrip or certificate, but it was still in the name of Donaldson; and before it could be reduced into Mowatt’s possession, so as to constitute him the stockholder, the ceremony of executing a transfer was at least necessary.

      2. Even if the stock belonged to Charles Mowatt, the transfer of it to the name of Donaldson was the act of the defendants, and by their answer it is shewn to have been done for an unlawful and fraudulent purpose. They will not, therefore, be permitted to allege their own wrong, in order to reclaim it. Was not this transaction unlawful, and a fraud upon the stockholders, who were about to elect directors for the year 1 The 5th section of their charter requires twenty-one directors to be chosen; “ each of which directors shall at all times during their continuance in office, be stockholders in said company, in their own rights, to the amount of at least 20 shares, and shall be citizens of the United States.” Now the allegation is, that James Donaldson was a mere nominal party; his name was used to fill up the list of directors to 21; and the object and intention was to have a name, a man of straw, for the stockholders to ballot for as a director, instead of a real, substantial person, who should be a stockholder in his own right, and a citizen of the United States. Is this to be tolerated 1 Perhaps the counsel for the defendants may say that this was the act of Mowatt alone, and that the defendants, as a corporate body, are not to be chargeable with it. The directors of the corporation were fully cognizant of the plan, and connived with Mowatt in the attempt to impose upon the stockholders at their ensuing election, by holding up a spurious ticket, a list of candidates for directors, some of whom had no existence, except in name. And for any thing that appears to the contrary, the plan succeeded* for Mowatt became the president of the company immediately afterwards. Shall the company, under such circumstances, be 'permitted to avail themselves of the defence that the shares, notwithstanding, belonged to Mowatt, and that their lien is preserved 1 Or shall they not rather be considered as acting in good faith, and as having made or permitted the transfer to James Donaldson, for honest purposes; such as mating him a stockholder in his own right, and rendering him eligible as a director'? If this view is taken of the case, it appears to me the defendants have no right to insist that Mowatt remained the owner or stockholder of the 20 shares in question.
    3. As to the title acquired by the complainant. There is no objection to the form or regularity of their title, under the assignment and power of attorney executed by Donaldson; but it is said by the defendants in their answer, that the Chemical Bank received it only as security for an antecedent debt due to them from Mowatt. Surely this is a sufficient consideration for the assignment. But what have the defendants to do with this question, if they have no legal claim to the stock 1 Is it not for them to controvert it with us, in behalf of Donaldson nr Mowatt, who alone could make such an objection. But it is said in the answer that the complainant had full knowledge before the assignment of the stock to him, of Mowatt’s indebtedness to the defendants, and of their by-laws. What if he had, how does this vary the case 1 It was notice merely of Mowatt’s indebtedness, and that they had by-laws regulating, the mode of transferring stock at their office, and upon their books; but it is not alleged that the complainant knew, or had notice, that the stock did not belong to Donaldson, or that it belonged to Mowatt, notwithstanding it stood in Donaldson’s name. Again; it may be said, that the answer denies “ that the assignment made, or pretended to be made, of said stock by the said Charles Mowatt, or any person by the name of James Donaldson, to the complainant, is valid.” Now I apprehend, that whether valid or invalid, is not a matter of fact to be disposed of by a general denial in the answer, but is rather a matter of law, to be judged of and determined by the court, upon the facts' and circumstances disclosed, combined with the law of the case. Whether the assignment was fraudulent and void, and intended to deprive the defendants of their lien, is certainly matter of inference, from the facts disclosed, and of law, of which the court are to judge, and not the defendants themselves. And I contend there is no fact stated, which warrants that inference, or justifies such a conclusion. The defendants had no lien at the time the assignment was made to the complainant, for they had long previously parted with all control over these 20 shares, so far as Mowatt’s interest and ownership was concerned, by their own voluntary act. That is, by suffering the transfer to be made to Donaldson, and by issuing the certificate in his name, as the stockholder; more especially since the object was to make Donaldson eligible as a director, who could only be a director in virtue of an absolute ownership in his own right. Have not the defendants, then, to say the least of it, placed themselves in the situation of a person who chooses voluntarily to part with a lien, by which he loses it forever 1

    The complainant is entitled to a decree for the transfer of these shares free from any claim of the defendants, and to an account of the dividends during the time the stock has been withheld, together with the costs of this suit.

      S. A. Foot <£- J. L. Graham,
    for the defendants. The principles of law applicable to the facts in this cause have been so long settled, and are so well known to the profession and to the court, that it appears to us no valuable purpose can be answered by drawing them into discussion on this occasion. We shall therefore content ourselves with a simple statement of them, so far as it may be necessary to allude to them at all in the course of our remarks.
    It is conceded that the defendants have no lien by the common law on the twenty shares of stock in question. It is also conceded that the defendants can create no lien on the stock of their company, as against a stockholder, by a by-law. That all they can do, by the rules and regulations which they are allowed to make on the subject of the transfer of their stock, is to prescribe the mode of enforcing the lien, which the statute gives them on the stock of indebted stockholders. And this probably they cannot do in derogation of any right which is secured to the delinquent stockholder by the written or unwritten law of the state. But as there is no question between the parties respecting the manner of enforcing the lien, the chancellor will not be obliged to trouble himself with that branch of the subject. The defendants place their right to a lien on the twenty shares of stock solely on the section of their act of incorporation which deprives any stockholder against whom the corporation shall have any claim or demand of a right to make any transfer, sale or conveyance of his stock in the corporation, or to receive any dividend thereon until such claim or demand shall be paid, or secured to be paid, to the satisfaction of the board of directors. The cause having, by the election of the complainant, been brought to a hearing by the bill and answer, the facts are to be taken from the statements in the answer, and the inferences which fairly follow from them. Charles Mowatt, being the owner of the twenty shares in controversy, transfened them not to any person in being, but to the mere name James Donaldson; and the president and secretary gave a certificate of the transfer, &c. While the shares were standing in that name, Mowatt became indebted to the company in a large sum of money, which is still due, and not secured to the satisfaction of the board of directors. After that debt was contracted, Mowatt procured a man who bore the name of James Donaldson to execute an assignment of the shares to the complainant, to secure a debt which Mowatt then owed the Chemical Bank. This man did execute such assignment,' and also a power of attorney authorizing the president of the bank to execute the necessary papers to procure a transfer of the stock. On this assignment and power being presented to the defendants, and a demand made to transfer the stock, they refused ; alleging that the stock did not belong to this man Donaldson, but that it belonged to Mowatt who was their debtor.
    The only point of enquiry, and the one on which the rights of the parties depend, is, who was the owner of the stock at the time Mowatt’s debt was contracted 1 or, in other words, was Mowatt then the owner or not 1 This material and decisive question seems to be best answered by putting another: If Mowatt was not then the owner, who was 1 Will the counsel for the complainant say that this man, James Donaldson, whom Mowatt afterwards looked up to execute the assignment and power, was the owner 1 If so, he could with equal propriety say, that when a man conveys a piece of property to James Smith, the title is vested in every James Smith in the world ; or rather, that when Mowatt transferred these shares to the name of James Donaldson, every man in existence by the name of James Donaldson became the owner of them. To meet this view of the subject, the complainant’s counsel appears to think that the certificate is decisive evidence that James Donaldson was the owner of the stock from the time it was issued, and that the defendants are concluded by it; concluded, we suppose he means, from alleging that a man by any other name was the owner. Now the very case which the learned counsel cites for this position, (Kane v. Bloodgood, 7 John. Ch. R. 108, 109, 132,) and at the pages he gives, particularly the last one, shows that a certificate of stock is not conclusive evidence of ownership, even against the company whose officers issue it. And another case, which he cites for a different purpose, (Bates v. The New-York Ins. Co. 3 John. Cas. 238,) shows the same thing. In both of these cases, the court looked at the rights of the parties, and recognized and protected them according to their written contracts; without reference to the certificates or the time when they were issued. Indeed, it is too clear to be discussed, that the transfer books of a corporation are only prima facie evidence of ownership of the stock; as the registry of foreign, and the license of domestic tonnage in the books of the custom house are prima facie evidence of the ownership of the vessels. But in each case that evidence is controlled by other of more authentic proof of the ownership of the stock or vessels. Before the passing of the “ Act to prevent fraudulent bankruptcies by incorporated companies, to facilitate proceedings against them and for other purposes,” (Laws of 1825, p. 452, sess. 48, ch. 235, sec. 13,) stockholders of companies voted at elections according to the actual ownership of the stock, without reference to the names in which it stood on the transfer books. The 13th section of that act, which declares that the ownership of stock, so far as it regards the right to vote, shall be tested by the transfer book, introduced a new rule; and so it was understood by the public and the profession. Yet this is not the true way of considering the subject under discussion; for it assumes that the stock in question was transferred by Mowatt to a person in being. But in fact he merely transferred it to a name, or in other words changed the name, in which, for his own purpose, he chose to have this stock stand on the books of the company; and that is all the certificate purports. The president and secretary of the defendants do not certify that James Donaldson was the owner of the twenty shares of stock, but only that twenty shares stand on their books in the name of James Donaldson.
    To make a valid contract for the transfer of the ownership of property, real or personal, there must be a person to transfer, and a person to whom the transfer is made, or nothing passes. Now, in this case, Mowatt transferred to a name, not to a person; of course nothing passed. The ownership remained, and he continued a stockholder as to these twenty shares. So, too, as to obligations. To make a valid one, there must be an obligor and obligee. If there is no obligee, there is no obligation. There is one qualified exception to this rule, and that relates to negotiable paper"; in respect to which, for commercial purposes, a note payable to a fictitious person or order, will be held under certain circumstances to be payable to bearer, for the purpose of enforcing the obligations of the real persons on the note, and who became parties to it with a knowledge of the fiction. Suppose Mowatt had transferred these shares to the name John Doe. Would not the James Donaldson, whom Mowatt afterwards looked up to execute the papers, have been just as much the owner of the shares as he was by this transfer to a name which was similar ■ to his own 1 No one can reasonably doubt it. The conclusion, therefore, amounts to demonstration, that the transfer of these shares by Mowatt, the owner, to the name James Donaldson, did not divest his ownership ; and consequently when his debt was contracted, the lien of the. defendants attached to these shares.
    It is unnecessary to enquire what rights the complainant or his principal, the Chemical Bank, acquired under the assignment and power executed by Donaldson by the procurement of Mowatt. The effect of the transaction probably was, to give the Chemical Bank, in equity, Mo watt’s interest in the shares. But whether it did so or not is immaterial, as the defendants’ lien had previously attached. It only remains to notice the observations made by the complainant’s counsel. Under his second division, the substance of them is, as nearly as we can gather it, that because the president and secretary issued the certificate shewing that the shares stood in the name of James Donaldson, with a knowledge of Mowatt’s object, which was to have a name to put in merely to fill up the list of directors then about to be chosen, the company ought to be deprived of their lien; and of course to be subjected to the loss of the amount of the value of the shares.
    The first question which naturally arises from this view of the case is this: Has the complainant, or his principal, the Chemical Bank, been deceived or injured by the issuing of this certificate 1 Have they parted with any of their funds or property upon its credit 1 No; for the bank took the stock to secure a prior debt,- and if the defendants retain it, the bank is no worse off than it was before. Besides this, the bank took the stock at their peril as to title; and the same peril to which every purchaser is subject, the identity of the person who conveys. The cashier was bound to enquire at his peril, first, whether the stock belonged to James Donaldson; and if it is admitted that the certificate was a reasonable answer to that inquiry, then, second, whether the James Donaldson who offered to transfer it was the James Donaldson who owned the stock. The first step he took in that enquiry would probably have given him the true situation of the stock. But admit that the president and secretary did wrong in issuing the certificate, can it be reasonably contended that the corporation must therefore lose its hen, when no one has been injured by it 1 There is probably a still more decisive pnswer to this view of the subject; and it is this : Mowatt being the owner, had a right to transfer the stock to any name, and for any purpose he pleased not prohibited by law. And neither the officers nor the company cóuld sit as censores morurn over the conduct of Mowatt, and give or refuse him his rights as they should find it fair or otherwise.
   The Chancellor.

By the eighth section of the act incorporating the Phenix Fire Insurance Company, (Laws of 1823, p. 114,) it is provided that the stock shall be assignable and transferable according to such'rules, and subject to such restrictions and regulations, as the directors shall establish.. And by the answer of the defendants, it appears that soon after the organization of this company, a by-law was made, and is still in force, by which it is declared that no transfer or assignment of stock shall be valid, unless made on the books of the company. This does not give to the company any claim upon the stock by way of lien. But as the legal title cannot pass until such transfer takes place, a purchaser without such transfer takes the stock subject to any equitable claim which may exist against it either in favor of the company or any other person. Where the equities are equal, and neither party has obtained the legal right to the stock, by an actual transfer upon the books of the company according to the statute and the by-law, the prior equity must prevail. (Bates v. N. Y. Ins. Co. 3 John. Cas. 238.) The case would be entirely different if there was no statute'or valid by-law regulating the manner of transferring shares in an incorporated joint stock company; and where, by the charter, the stock was declared to be assignable. In ■such a case a simple assignment, intimated to the proper officer of the corporation, although it was not entered on the company’s books, would be sufficient to transfer the legal right; and a bona fide assignee of the stock would hold the same free from any equitable claims thereon of which he had no previous notice. Whether the defendants in this case have any legal or equitable lien upon the stock in question, remains to be considered.

The second clause of the eighth section of the act of incorporation declares, that if the company has any claim or demand against a stockholder, either due or to become due, he ' shall not be entitled to make any transfer, sale, or conveyance of his stock, or to receive a dividend thereon, until such claim or demand shall be paid or secured to the satisfaction of the board of directors. The answer states in express terms that the stock was merely transferred to the name of J. Donaldson, for the ptirpose of having a name to insert in the list of directors there being no such person as James Donaldson who was the actual owner of the stock, or to whom such transfer was made. The defendants also deny that the James Donaldson who executed this blank assignment to enable Mowatt to transfer the stock, ever had any interest or property whatever therein. As the complainant has not given the defendants an opportunity to prove these allegations, and has chosen to go to hearing upon bill and answer, the allegations must be taken as literally true. If so, the transfer of these shares to a fictitious person was a mere nullity ; and the legal title never passed from Mowatt. It appears, however, that the officers of the corporation were aware that this was a mere fictitious transfer, and that it was made for the purpose of imposing upon such of the stockholders as were not in the secret. If, therefore, the complainant had actually advanced the money to the person that Mowatt afterwards elected to treat as the owner of the stock, and without notice of the real facts of the case, I am inclined to think he would have had an equitable claim to hold such stock even against the defendants’ legal lien. But an assignment for the payment or security of an antecedent debt, and without any new consideration paid, is not sufficient to raise such an equity.

I have no doubt that in equity the lien given by this charter upon -the stock belonging to debtors of the company, and upon the dividends thereon, extends to all stock actually owned by such debtors, whether standing in their own names or in the names of other persons as their trustees. But the defendants could not be permitted to enforce that lien against bona fide purchasers of the .stock who had no notice of such equitable lien. From the facts disclosed in this-answer,.I am satisfied the defendants have both an equitable and a legal lien upon the stock in question, for the security of their demand against Mowatt; and they have also the right to retain the dividends, and to sell the stock in the manner prescribed by the charter to satisfy that claim. A decree must therefore be entered declaringsuclinght; but allowing the complainant to redeem, if he thinks proper to do so. The complainant, in case he redeems, will be entitled to a transfer of the stock, and to any other securities the defendants may have for their demands against Mowatt. But whether he elects to redeem, or otherwise, he must pay to the defendants their costs in this suit.


text:
    Holmes vs. Holmes.
    May 28.
    Where a husband, for the purpose of depriving his wife of any share of his personal property after his death, purchased real estate from his son at a price far beyond its value, and gave his bond and mortgage for the purchase money, the collection of which was not to be enforced during the life of the husband ; Held, that the transaction was valid, and that the widow could not have the bond and mortgage set aside as fraudulent as against her.
    The owner of personal property, as against every person except creditors, may make such disposition thereof as he pleases, either by will or otherwise. He cannot therefore commit a fraud upon his wife or children by disposing of it after his death in any manner he may think proper.
    This was an appeal from a decree of the vice chancellor of the fifth circuit. The. facts in the case, as presented by the pleadings and proofs, were, that the husband of the complainant, being the owner of considerable personal property and wishing to deprive his wife of the one third of it to which she would be entitled by the statute of distributions after his death, agreed with his son to purchase of him real estate at a price far beyond its value, and to give him a bond and mortgage thereon, which security was not to be enforced in the life time of the father. The amount due on the bond and mortgage, at the death of the father, was equal to the whole amount of his personal estate. Upon a bill filed by the widow to set aside . the bond and mortgage, the vice chancellor decreed that she should release her right of dower in the real estate purchased, and that the son should pay to her one third of the personal estate, as her distributive share, without deducting the amount of the bond and mortgage therefrom. From this, decree the defendant appealed.

      T. Jenkins, for the complainant.

      M. T. Reynolds, for the defendant.
   The Chancellor.

The vice chancellor has probably arrived at a correct conclusion in supposing it was the intention of the father and son to convert his personal property into real estate, for the purpose of defrauding the wife of her distributive share of the personalty after the death of her husband. ,But he was wrong in deciding that the facts stated in the complainant’s bill could amount to a fraud of which any earthly tribunal could take cognizance. The cases of underhand dealings and secret conveyances made in contemplation of marriage, depend upon an entirely different principle. The husband in this case was, probably, not aware of his legal rights, and therefore he resorted to this device to deprive the wife of a distributive share of his personal estate, when he might have effected the same thing directly, without violating any principle of law or equity.

The owner of personal estate, as against every person except his creditors, has the absolute and uncontrollable power and right to make such disposition thereof as he may think proper, either by a gift inter vivas, or causa mortis, or by will. Neither the wife or children have any interest in the property, except so far as the husband or father may be liable for their support or maintenance during his life. It is therefore impossible that he should defraud either, by any disposition he may make of his property to take effect after his death. The law has indeed provided that the wife shall be entitled to one third of the residuary estate if the husband dies without a will. And if he makes no disposition of his property by will, or otherwise, the legal presumption is that he intended to permit the law to take its course in the distribution of the estate after his death. But in this case he has thought proper to deprive his widow of any share of his personal estate by the purchase of real property at a price far beyond its value. And as he had the right to give the whole personal estate to the son, absolutely,the wife could not be defrauded by this arrangement. She was in fact benefitted thereby, as by the purchase of the land she has acquired a right of dower therein which cannot now be divested ; and the personal property must first be applied to pay off the mortgage.

Although the complainant was not entitled to the particular relief granted by the decree of the vice chancellor, yet as it appeared there was sufficient personal property in the hands of the defendant to satisfy the mortgage, he should be decreed to dischargejhe same, so far as it is an incumbrance on her dower in the land. She is entitled to dower, and to the arrears of the mesne profits, from the death of her husband; but the proper parties are not before the court to enable me to make a decree to that effect. The decree of the vice chanceller must be reversed ; and a decree must be entered, here, directing the defendant to execute to the complainant a release, discharging her right of dower from the hen of the mortgage ; with liberty to her to proceed at law, or otherwise, as she may be advised, to recover her dower in the premises, and the mesne profits since the death of her husband. Neither party is to have costs as against the other, either in the original suit, or on this appeal.