text:
    Chaffee and Chapman vs. The Baptist Missionary Convention of the State of New-York.
    The return of the surrogate, on an appeal to the circuit judge in relation to the probate of a paper propounded as a will of personal estate, should state who were the next of kin of the decedent, and which, if any, were infants, who were cited to attend upon the proving of the will, and who did in fact attend and litigate the will.
    And the appellants upon the appeal to the circuit judge, should present a petition of appeal to him, and should state therein among other things the names of the persons interested in sustaining the decree of the surrogate; and they should make all those who appeared before the surrogate in opposition to the appellants parties to such appeal. Such petition of appeal should also pray that a day may be fixed, by the circuit judge, for the persons made respondents therein and for the appellants to be heard on the appeal; so that due notice of the hearing may be given to the respondents.
    If either of the respondents is an infant, the circuit judge should appoint a guardian ad litem to protect his rights on the appeal.
    And in the decree of the circuit judge on such appeal, or in the proceedings before him which are returned by him to the surrogate with his decision, it should appear which of the respondents named in the petition of appeal appeared before him, and that those respondents who did not appear had been duly notified of the time and place of hearing, as directed by the statute.
    An attestation clause, showing upon its face that all the forms required by the statute have been complied with, is not absolutely necessary to the validity of a will; as the subscribing witnesses will be permitted to prove that the forms were in fact complied with, although the attéstation clause is silent on 'the subject.
    And after the death of the subscribing witnesses, a compliance with any of the forms required by" the statute and not noticed in the attestation clause, may even be presumed from circumstances.
    Although the attestation clause to a will states that all the formalities required by the statute in the execution of the will have been complied with, the fact may be disproved by the subscribing witnesses.
    But a proper attestation clause, showing that all the statute formalities have been complied with, will, in the absence of proof to the contrary, be presumptive evidence of the fact, after the death of the subscribing witnesses, or where, from the lapse of time, the witnesses cannot recollect what took place at the execution of the will.
    1843. January 23.
    A proper attestation clause is also important to, show that the person who prepared the will knew what formalities in its execution were required, and to raise the presumption that he gave to the testator the necessary information in relation thereto ; or if he was present at the execution of the will, that he took care that such formalities were complied with.
    It is proper that the whole .attestation clause should, at the time of the execution of the will, be read over in the hearing of the witnesses and of the testator. And where the testator is illiterate, it is also proper that the whole will should be deliberately read over to him in the presence and hearing of the witnesses; and that the fact of such reading in his presence should be stated in the attestation clause; or at least the witnesses should, by inquiries of such illiterate testator, ascertain the fact that he is aware of the contents of the instrument which he executes and publishes as his will, and that he is possessed of a competent understanding to make a testamentary disposition of his property. The neglect, however, of these precautions, will not render the will invalid, if the court and jury before whom the question of its validity is tried are satisfied, upon the whole evidence, that the will was duly executed, and that the testator understood its contents.
    Where any of the formalities required by the statute, in the execution of a will, are not substantially complied with, the will is void.
    The burden of proving the due execution of the will lies upon the party seeking to establish it. But it may be proved by other evidence than that of the subscribing witnesses; or its due execution may be inferred from circumstances, where the subscribing witnesses are dead, absent, or otherwise incapacitated to give testimony, or where, from lapse of time or otherwise, they are unable to recollect whether the requisite formalities were observed when they witnessed the execution of the instrument.
    The subscription of the will must be made by the testator in,the presence of each of the attesting witnesses, or it must be acknowledged by him to have been so made, to each of the attesting witnesses.
    Where the testator, at the time of the execution of his will in presence of the attesting witnesses, placed his finger on his name subscribed at the end of the will, and acknowledged that it was his last will and testament, but there was no evidence that he subscribed it in the presence of the attesting witnesses, or that he acknowledged in their presence that such subscription was made by him or by his direction or in his presence, held that the will was not duly executed.
    The making of his mark at the end of the will, by the testator, is a sufficient signing of the will to be a compliance with the requirement of the statute.
    This was an appeal from the decision of the circuit judge of the seventh circuit, reversing the sentence or decree of the surrogate of the county of Onondaga against the validity of a paper propounded as the will of Hannah' Chandler deceased. The instrument propounded was without date, but from the testimony of one of the witnesses it must have been made about three or four years before it was offered for probate in 1841. It purported to have been signed with the name of the testatrix, and sealed j it had, in addition, an attestation clause, by which the subscribing witnesses were made to certify that it was signed, sealed, delivered and published by her, to be her last will and testament, in their presence ; and that they had thereto subscribed their names as witnessess, in her presence, but without stating that it was done at her request. One of, the subscribing witnesses, however, swore positively that he and the other witness subscribed it at her request, though the latter could not recollect whether she requested him to sign it or not. Both "witnesses went there at the request of the person who was named as executor, and in whose hand-writing the instrument was supposed to be, to witness the will. But that person did not go into the room with them, and no person was present at the time except the two subscribing witnesses and the testatrix. And the person named as executor, and at whose request they went to the house of Mr. Chapman with whom she lived, was dead at the time her will was offered for probate. Neither of the subscribing witnesses knew whether the testatrix could write ; but it appeared from papers in the surrogate’s office relative to the administration of the estate of her deceased husband, that she signed the bond, oath, inventory, &c. by making her mark only. The subscribing witnesses testified that when they went to the decedent’s room she took the instrument, which then had her name to it, out of her drawer, and putting her finger on her name, said, “ I acknowledge this to be my last will and testament,” or words to that effect. But she did not admit, in the presence of the witnesses, that she had subscribed her name to the will, or that it had been subscribed thereto by any other person by her direction. After the witnesses had subscribed their names to the will, she delivered it to one of them with a request that he would keep it j and he retained it accordingly until it was delivered to the surrogate, for probate, after her death.
    The surrogate having decided that the instrument propounded as a will had not been executed according to law, and refused to admit it to probate, The Baptist Missionary Convention of the State of New-York entered an appeal to the circuit judge. The case having been heard before him, he came to the conclusion that the surrogate’s decision, upon the questions of law arising upon the sentence or decree appealed from, was erroneous ; and he reversed the decision, and directed that the respondents in that appeal should pay to the appellants $39,51, for their costs upon such appeal. This decision having been certified to the surrogate, Chaffee and Chapman, as distributees or next of kip of the decedent, entered an appeal to the chancello1:.
    G. F. Comstock, for the appellants.

      J. F. Sabine, for the respondents.
   The Chancellor.

The return in this case is very imperfect, as it does not state who propounded the will before the surrogate, when the proceedings to prove it were instituted j who were ascertained by him to be the next of kin of the decedent, and which of them, if any, were infants, or were cited to attend upon the proving of the will; or who did in fact attend and litigate the will before him. All this should have appeared upon the return, to enable the circuit judge to know who were the proper persons to be made parties to the appeal to him. (Laws of 1837, p. 525, § 5 to 10.) The appellants also should have presented a petition of appeal to the circuit judge, naming, among other things, the persons who were interested in sustaining the decree of the surrogate, as the next of kin of the decedent j and making at least all of those who appeared before the surrogate in opposition to the appellants, parties to such appeal. It should also pray that a day may be fixed for the persons thus made respondents, and the appellants, to be heard on such appeal j so that due notice of the hearing may be given to such of the parties as are entitied to appear to sustain the decision of the surrogate. (2 R. S. 608, § 93, 94.) If either of the respondents is an infant, who has no general guardian, or whose general guardian has an adverse interest, the circuit judge should appoint a guardian ad litem to protect the rights of the infant on the appeal. And in the decree or order of the circuit judge affirming or reversing the sentence of the surrogate, or in the proceedings before him, which proceedings should be returned to the surrogate with his decision so that they may be sent to .this court if that decision is appealed from, it should be stated which of the respondents, named in the petition of appeal to the circuit judge, appeared before him j and it should also be stated that those who did not appear were duly notified of the time and place of hearing, as di-' rected by the statute.

Here the persons who were respondents before the circuit judge are directed to pay the cbsts of the adverse party. But in the certificate and proceedings sent by the circuit judge to the surrogate, it does not appear who those respondents, were so as to enable the surrogate to carry into effect the decision of the appellate tribunal. (2 R. S. 609, § 97.) The appellants in this court, however, have no right to complain that the decree of the circuit judge is so indefinite in this respect that it never can be enforced against them. And the conclusion to which I have come upon the merits of the case renders it unnecessary that I should base the decision, which I make, upon any of these technical defects in the proceedings before the circuit judge, or on the defective return of the surrogate. For enough appears to show that in point of law the surrogate was right in supposing that the paper propounded was not executed in the manner prescribed in the revised statutes, so as to make it a valid will of either real or personal property in this state.

An attestation clause, showing upon its face that all the forms required by the statute have been complied with, is not absolutely necessary to the validity of a will; as the witnesses will be permitted to prove that the forms were in fact all complied with, although the attestation clause is silent on the subject. Indeed it has been decided that a formality of this kind, not noticed in the attestation clause, may even be presumed from circumstances, after the witnesses to the will are dead. (Croft v. Pawlet, 2 Str. Rep. 1109. Bryce v. Smith, Willes' 1. Hands v. James, Comyn’s Rep. 531.) The statute does not require an attestation clause showing that the proper legal formalities were complied with; and although upon the face of the instrument those formalities are stated to have taken place, the fact may be disproved by the witnesses. But prudence requires that a proper attestation clause should be drawn, showing that all the statute formalities were complied with; not only as.presumptive evidence of the fact in case of the death of the witnesses, or where from lapse of time they cannot recollect what did take place, but also for the purpose of showing that the person who prepared the will knew what the requisite formalities were, and therefore gave the proper information to the testator, or saw that they were complied with if he was present. To impress the more strongly upon the memory of the witnesses the important fact that all the legal forms requisite to a due execution of the will were complied with, at the time when they subscribed their names as witnesses to such execution, the safer course always is to read over the whole of the attestation clause, in the presence and hearing of the witnesses, and .of the testator. And where the person executing the will is not known to the subscribing witnesses, to be capable of reading and writing, especially if he executes the will as a marksman, it would be proper that the whole will should be deliberately read over to him in the presence and hearing of the witnesses, and the fact of such reading in his presence should be stated in the attestation clause. Or at least the witnesses ought, by inquiries of the illiterate testator himself, to ascertain the fact that he was fully apprized of the contents of the instrument which he executed and published as his will, as well as that he was of competent understanding to make a testamentary disposition of his property. All these kings, however, are matters of precaution and prudence, to prevent any well founded doubt upon matters of fact; and where they are neglected it does not necessarily render the J ° ... will invalid, if the court or jury which is to pass upon the question of its validity is satisfied, upon the whole evidence, that the will was duly executed, and that the testator understood its contents.

The legislature, however, has seen proper to prescribe certain legal requisites to the due execution of a will j all of which must be substantially complied with or the will is void in law. And the onus of satisfying the court that these forms were complied with lies upon the party seeking to establish the will. But the fact of such compliance may be proved fey other evidence, or inferred from circumstances, where the subscribing witnesses are dead, or absent, or otherwise incapacitated to give testimony j or where from lapse of time, or otherwise, they are unable to recollect whether the requisite formalities were observed at the time when they witnessed the execution of the instrument. The first of the legal forms required by the statute is that the will shall be subscribed by the testator at the end thereof. And the second, which is equally imperative, is that such subscription shall be made by the testator, in the presence of each of the attesting witnesses, of shall be acknowledged by him to have been so made to each of the attesting witnesses. (2 R. S. 63, § 40, sub. 2.) It is not necessary that the testator should be able to write his name; for it has been determined^ that the making of his mark, by the testator, is a sufficient signing within the statute. (1 Rob. on Wills, 94. Addy v. Grix, 8 Ves. 504.) The former statute required that the will should be signed by the testator, or by some other person in his presence and by his direction. And that the legislature did not intend to alter the law in that respect is evident from the fact that this mode of subscribing the testator’s name, by the instrumentality of another person but by the testator’s direction, is recognized in the 41st section. There was no evidence here, however, that the name was subscribed to this testamentary paper by the direction of the testatrix, or even in her presence. And for aught that appears to the contrary the will may have been brought to her precisely in the form in which it appeared when she took it out of the drawer. She did not admit to either of the witnesses that she had subscribed her name to the will, or say that any other person had written it there in her presence, or by her direction. On the contrary, one of the witnesses swears that he did not hear her say any thing about who wrote the name 5 and the other says nothing on the subject. The attestation clause states that the will was signed by her in the presence of the witnesses; but this is contradicted by the testimony of both of these witnesses.

The putting her finger upon the part of the will where the seal was, and acknowledging that the instrument was her last will and testament, was merely a compliance with the directions of the third subdivision of the 40th section, which required her to declare the instrument which she asked the witnesses to attest, to be her last will and testament. But it did not supersede the necessity of an actual subscription in the presence of the witnesses, or an acknowledgment to each of them that she had previously subscribed it, or had directed some other person to sign it with her name which appeared thereon.

In Remsen v. Brinckerhoof (26 Wend. Rep. 331,) Chief Justice Nelson, after stating the four requisites to a valid execution of a will, under the provisions of the 40th section of the revised statutes on the subject, says “ it is obvious that any one of these four requisites, in contemplation of the statute, is to be regarded as essential as another j that there must be a concurrence of all to give validity to the act, and that the omission of either is fatal.” And as the will in that case was pronounced invalid, although subscribed by the testatrix in the presence of the attesting witnesses, for want of due publication in their presence, so in this it must be declared not to have been duly executed because it was not subscribed by her in the presence of the witnesses, as is erroneously stated in the attestation clause ; and because there is no proof that she acknowledged in their presence that her name subscribed to it was put there by her, or by her direction, or in her presence.

I regret to be compelled to come to this conclusion in regard to this particular-case. For the circumstances are such as to render it highly probable that the will had-been drawn under the direction of the testatrix, and that her name had been put to it by her request after she had perfectly understood the contents of the will. She must likewise have supposed that the instrument .which she acknowledged to be her last will and testament and which she requested these witnesses to attest as such, was properly executed to carry into effect her pious and benevolent intentions in favor of the respondents, and of the other charitable institutions mentioned therein. And she may have had very good reasons for wishing to conceal from her brother in law, and his family, a knowledge of the fact that she was disposing of her property in this manner. But, as the requisites of the statute have not been complied with, this court can only pronounce the legal result of such non-compliance.

It does not however appear to be a case in which a charitable society which has litigated in good faith, and has been defeated upon a technical objection as to the due execution of the will, should be charged with costs. But as the appellants have successfully contested the case for the benefit of themselves and the other parties who may be entitled as the next of kin of the decedent, they should not be permitted to bear the burden of the costs personally.

A decree must therefore be entered, reversing that of the circuit judge and affirming the sentence and decree of the surrogate ; and directing the taxable costs of the appellants, Chaffee and Chapman, both in this court and before the circuit judge, to be paid out of the estate of the decedent, when letters of administration shall have been granted thereon,

         See Hudson v. Parker, decided 4th July, 1844, before D. Lushington in the prerogative court, (8 Lond. Jurist Rep. 786;) and Burgoyne v. Showler, (Idem, 812.)


source: Caselaw Access Project

author: The Chancellor.

license: Public Domain

text:
    Suydam and others vs. Bartle and others.
    1843. January 23.
    An agreement that an agent or factor shall receive a reasonable compensa» tion, to be paid by the principal, for accepting and paying bills with funds furnished by the latter, is not per se usurious.
    And where the agreement, by its terms, contemplates an advance of money to pay the bills, when they become due, if the principal does not furnish the means of payment at the day, an allegation that such agreement was usurious merely presents a question of fact, to be decided by the proofs, whether the compensation agreed to be paid was intended as a mere shift ' to cover an usurious premium on such advances, or was intended as a compensation for the trouble and expense of accepting arid paying the bills as the agent of the principal.
    To render it necessary to file a replication to an answer, so as to enable the parties to take proofs of usury, the answer should contain a distinct allegation of usury$ and an answer in which the defendant states, in general terms, that she believes the transaction was tainted with usury, is not sufficient for that purpose.
    The bill in this cause was filed to foreclose a mortgage, executed by Bartle and wife and McNeil and wife, together with C. M. Norton, to the complainants ; to secure the payment of a bond, executed by Bartle, McNeil and J. M. Norton to the complainants, conditioned to pay $40,000 and interest from the 12th of February, 1838.
    The defendant C. M. Norton, who had mortgaged her dower interest in the premises as a mere surety for the obligors in the bond, put in an answer, not denying any of the allegations in the bill ■ but asking to have her rights protected if there should be any surplus proceeds of the mortgaged premises after paying the complainants’ debt. The three obligors in the bond, together with Dickinson and Holliday their assignees, put in an answer, without oath, the substance of which was, that the bond and mortgage Were usurious, because they were given to secure the balance due upon drafts drawn by Norton, Bartle and McNeil, and by a former firm of a different name, upon the complainants, under an agreement that the drawers should forward to the complainants produce, to be sold at New-York at a commission of two and a half per cent, and that the complainants should accept the draft drawn on them, and should charge a commission of two and a half per cent for the acceptance of such drafts as were not met, by the proceeds of the produce sold, when they became due. The cause was heard on bill and answers as to the defendants who put in answers, except McNeil who had parted with all his interest to the assignees, and died before the hearing. And as to the other defendants, who were mere nominal parties, the bill was taken as confessed.

      D. Greig, for the complainants.
    The agreement set forth in the answer of Bartle and others is not usurious. No loan was contemplated. There was no corrupt agreement, no device or cover for usury. ' To constitute usury there must'be three things ; a loan, a corrupt agreement, and taking more than lawful interest. (2 Cowen, 678. 7 John. Ch. 77. 2 Cowen, 712. 4 Bro. C. C. 28. 1 Ves. jun. 527. 1 Atk. 340, 350. 7 Barn. & Cress. 453. 7 Peters, 103. 4 Idem, 205.) If there is any doubt the court will not presume a contract a shift, or for usury. (1 Wash. 368.) If a contract admits of two constructions, the one taking it out of the statute will be adopted. (3 Cowen, 284. 8 Wend. 533. 10 Idem. 116. 2 Mod. 307. Cro. Car. 501.) A charge of a commission, by factors, in addition to legal interest on advances made, is lawful. (Com. on Usury, 119, § 11. 19 John. R. 160. 7 John. Ch. 69.) The two and a half per cent, commission to be allowed the complainants, is the usual commission charged by factors. It was a reasonable compensation for the services to be rendered, and was not a cover for usury. (15 Ves. 121. 1 Rose, 29. 2 T. R. 52, n. 2 Dea. & Chit. 12, 240. 2 Rose, 453. 1 Mad. 112. 17 Ves. 332. 19 John. 160.) The agreement is not usurious on its face, as commissions .are allowable and have been approved by the courts. The answer does not set up the defence of usury particularly. It is therefore not in issue. (4 Paige, 526. 6 T. R. 460. 3 Cowen, 284. 8 Wend. 533. 1 Wash.
      368. 2 Cowen, 2, 271. 6 T. R. 460. 6 Mod. 303. 3 Doug. 218. 7 John. Ch. 69. 4 Peters, 205.) The court cannot infer what the defendants do not aver.

      J. Edwards, for Bartle and others.
    The agreement, set forth in the answer of Bartle and others, executed simultaneously with the delivery of the bond and mortgage set forth in the bill of the complainants, and in reference to the same business, formed a part of the bond and mortgage. Such agreement is usurious because it stipulated that Norton, Bartle and McNeil, in addition to paying legal interest on the money raised on drafts, or advanced by the complainants to pay drafts not met at maturity, by the proceeds of produce, should also" pay two' and a half per cent on all sums so advanced ; and should consign to them produce to be sold by them upon commission, from which they would realize a large profit. If the money raised on the drafts, by the complainants, cannot be regarded as loans, the transaction must be considered as a change of securities, on which the complainants are to receive legal interest and also two and a half per cent on all advances made by them. This was a device and a cover for usury. (Dunham v. Dey, 13 John. 40. 16 John. 367. 5 John. Ch. 122. 21 Wend. 103. 1 Camp. 177.)

      J. Rhoades, for C. M. Norton.
   The Chancellor.

The only question necessary to be considered in this case is, whether the transaction as stated in the answer of Bartle and others is usurious. There is no allegation that the form of providing for a commission of two and a half per cent, upon the acceptance of the. drafts which should not be paid with the proceeds of produce, was resorted to or intended as a mere cover for usury, or as extra interest upon moneys tobe loaned to the obligors in the bond, and to the former firm. It is not per se usurious for an agent or factor to agree for a reasonable commission, to be paid by the principal, for accepting and paying bills with funds furnished by the latter. And such I understand from the answer to have been the nature of the agreement made in this case.

It is true the parties contemplated that the bills would generally be paid with the proceeds of produce ; in which case the two and a half per cent, upon the amount of sales, was all the compensation the complainants were to receive for their trouble and expense, both for selling the produce and accepting and paying the drafts when they became due. But they also seem to have contemplated that the drawers would not always be able to send produce sufficient to meet and take up the drafts when they became due j and that it might sometimes be necessary that they should transmit other funds for that purpose. There is no pretence in the answer, however, that there was any agreement, or understanding between the parties, that the obligors should be authorized to draw without making provision for the payment of such drafts, at the times when they became payable, either by sending produce to be sold, or by remitting other funds to the complainants for that purpose. Even if the agreement by its terms contemplated an advance of money to pay the bills when they became due, so that they should not be returned protested if the drawers did not furnish the means of paying them at the day, it would still be a question of fact, to be decided by proof, whether the two and a half per cent was intended as a mere shift to cover an usurious premium on such advances, or as a compensation for the trouble and expense of accepting and paying the bills by the complainants, as the agents of the drawers. (Nourse v. Prime, 7 John. Ch. Rep. 78. Comyn on Usury, 133.) To enable either party to take proofs on this question, the answer should contain an allegation, or averment, that the parties intended the commission, upon the acceptances, as a premium for the advance of the money, beyond the legal rate of interest. The allegation in the answer of Mrs. Norton, the widow, that she is informed and believes the transaction is tainted with usury, is not sufficient to render it necessary to file a replication to that answer.

There must, therefore, be the usual decree, referring it to a master to compute the amount due on the bond and mortgage, and for a sale to satisfy the amount due with interest and costs ; and a decree over against the surviving obligor in the bond for the deficiency. The surplus, if any, must be brought into court. And the question as to the right of Mrs. Norton to claim such surplus, to the extent of the value of her interest in the mortgaged premises, arid all other questions and directions as between her and her co-defendants, are to be reserved by the decree.


text:
    Alston and wife vs. Jones and others.
    1843. January 23.
    An appeal from the sentence or decree of a surrogate confirming the probate of a will of personal property, upon allegations against the validity of the will, filed in the office of the surrogate, under the 31st section of the article of the revised statutes relative to wills of personal property and the probate of them, must he brought in the first instance to the circuit judge, and not directly to the chancellor.
    The 55th section of the third article of the same title, allowing appeals to the circuit judge, applies to all cases in which the validity of the will, or the competency of the proof to establish the same, is the question in controversy before the surrogate; whether such question arises upon an original application of the executor, or other person, propounding the will for probate, or upon an allegation against the validity of a will which has been admitted to probate, as authorized by the 31st section.
    This was an application to dismiss an appeal, made directly to the chancellor, from the sentence or decree of the surrogate of the city of New-York, confirming the probate of a will of personal property, upon allegations against the validity of the will, filed in the office of the surrogate, by the appellants, pursuant to the 31st section of the article of the revised statutes relative to wills of personal property and the probate of them.

      E. S. Derry, for the appellants.

      M. S. Bidwell, for the respondents.
   The Chancellor.

The 35th section of the title of the revised statutes relative to wills and testaments of real and personal property and the probate of them, (2 R. S. 62,) gives an appeal from the decision of a surrogate upon allegations filed to test the validity of a will of personal property or the competency of the proof thereof. And the only question in this case is, whether an appeal lies directly to the chancellor ; or whether the party complaining of the sentence or decree of the surrogate is to appeal in the first place to the circuit judge, as authorized by the 55th section of that title. (Idem, 66.) The language of that section is not as explicit as it ought to have been, when applied to the particular case now under consideration. But when we advert to the practice of the ecclesiastical courts of England, in granting probate of wills in the common form, and then permitting the next of kin, as a matter of course, where they have not been actually cited to attend the proof of the will per testes, to call upon the executor to prove the will in a plenary proceeding, and also when we consider the manner in which the several provisions of the revised statutes on the subject of the proof of wills were introduced by the revisers and were adopted by the legislature, I am satisfied that this 55 th section was intended to apply to all cases in which the validity of the will, or the competency of the proof to establish the same, was the question in controversy before the surrogate ; whether that question had arisen upon an original application of the executor or other person propounding the will for probate, or upon an allegation against the validity of the instrument which had been previously admitted to probate, as authorized by the 31st.section.

By referring to the original report of the revisers it will be seen that they proposed to give to the surrogate the power to award a feigned issue, upon the filing of an allegation under this 31st section, if the validity of the will depended upon a question of fact—leaving the control of that issue to the supreme court until it should be finally determined ; and to give an appeal directly to the chancellor when no issue was awarded, as in cases of granting of letters of administration. [Rev. Rep. of ch. 6, pt. 2, p. 13, § 41, 42,43.) The legislature, however, thought it inexpedient to entrust the power of awarding issues to the surrogate, in cases of this kind. And the revisers were instructed to prepare sections giving appeals to the circuit judges, in the first instance, in cases of contested wills both of real and personal estate ; with power to such appellate courts to award feigned issues if they disagreed with the surrogate upon a matter of fact. The 55th and several of the succeeding sections of this title were thereupon reported, and adopted, as a substitute for what the revisers had originally recommended. The legislature that adopted this substitute, therefore, intended that the question as to the validity of a will, when it depended on disputed matters of fact, in relation to which the appellate court might differ in opinion ‘ with the surrogate, should be submitted to a jury for decision. It is true the declared will of the legislature in this respect has been wholly disregarded in a recent case. And the effect of permitting the next of kin to lie by until the will has been proved in the common form, and then to come directly to this court by appeal, from a decision against them upon their application to revoke the probate, would be to enable them still further to defeat the obvious intention of the legislature in relation to such controversies, where they depend upon disputed facts.

The appeal in this case is therefore wrong, and it must be dismissed with the costs of this application ; but without prejudice to the right of the appellants to proceed upon their appeal to the circuit judge, in case it has been regularly entered and an appeal bond has been duly filed therein, so as to entitle them to proceed on that appeal, according to the provisions of the title of the revised statutes before referred to.

       The case alluded to is that of Stewart’s Executor v. Lispenard, (26 Wend. Rep. 323,) where the appellate court refused an issue, upon a reversal of the surrogate’s decision on a question of fact.


text:
    Smith & Barlow vs. Ballantyne & McNaughton.
    1843. January 23.
    Where a suit was brought against two persons as joint debtors and both appeared and put in separate defences to the suit, and one of them died before the trial, Held, that the judgment subsequently recovered against the survivor was not evidence of a joint indebtedness as against the representatives of the decedent, upon a bill filed against them to charge hiá estate with the debt; and that the complainant in his bill should make a distinct allegation that a joint indebtedness existed, and that he was bound to prove such allegation if it was denied.
    Where two persons are jointly indebted, and one of them dies leaving the survivor insolvent, the creditor may file his bill to obtain payment out of the estate of the decedent, whether the joint debtors were partners or otherwise.
    This was an appeal from an order and decree of the vice chancellor of the third circuit overruling the demurrer of the defendants, and directing them to pay the complainants’ judgment, with costs. The bill stated that the complainants recovered a judgment in the supreme court against R. Kenyon as survivor of D. Ballantyne, and issued an execution thereon to the sheriff of the county in which Kenyon last resided, which execution was afterwards returned unsatisfied, and that the judgment remained unpaid ; that the suit in which the judgment was recovered was commenced against Kenyon and Ballantyne in the lifetime of the latter, and that they both appeared and put in separate pleas, and before the trial of the suit Ballantyne died leaving sufficient property to pay all his debts and liabilities ; that the defendants administered upon his estate, and had ample assets to pay all his debts ; and that Kenyon, against whom the judgment was recovered as survivor, had not since the commencement of that suit possessed any property whatever. And the complainants thereupon prayed a decree for the payment of their judgment, out of the estate of the decedent in the hands of the defendants.
    To this bill the administrators of Ballantyne filed a general demurrer for want of equity.

      T. H. Wheeler & R. W. Peckham, for the appellants.
    There is no allegation in the bill of the indebtedness of Ballantyne. The judgment against Kenyon is no evidence of Ballantyne’s joint indebtedness, as against his representatives. As against one of two defendants, not served with process, a judgment entered against both is evidence only of the extent of the plaintiff’s demand, after his liability shall have been established by other evidence. (2 R. S. 377, § 1, 2 and 5. 23 Wend. 293.) There is no averment in the bill of the joint indebtedness of Ballantyne. On joint and several contracts, the representatives of one of the debtors, (who has died,) are liable at law. (2 John. Ch. R. 508. 3 Paige, 167.) If the complainants have a remedy at law, they cannot have the relief prayed for in their bill. (Comyn on Con. 472, 517. 2 Burr. 1194. 1 Chit. Pl. 37.) Ballantyne may have been surety for Kenyon. The contrary is not averred in the bill. If a surety, his estate, at • his death, was discharged from the debt, at law; and a court of equity will not charge his personal representatives. (2 Wash. Rep. 136.) If the complainants are entitled to any relief, it is to the amount of the original debt and interest only, not the costs. And pa ment is to be made only after all the other separate debts of Ballantyne are paid. (3 Paige, 167, 517.) If the demurrer is overruled the administrators of Ballantyne are entitled to put in an answer. They are not liable to the costs of this suit. Nor can the assets of the deceased be made liable to the payment of such costs.

      J. A. Hughston & A. Taber, for the respondents.
    The judgment against Kenyon is conclusive evidence of the liability of both defendants, the declaration having been personally served on both and both having appeared by attorney. (2 R. S. 299, § 2, 2d ed. 3 John. 20.) The bill must be founded on the judgment and not on the original promise. (6 Wend. 209, 210.) The original promise is merged in the judgment. (23 Wend. 293.) The merger did not discharge the estate of Ballantyne. (6
      Wend. 209.) Where one of two or more defendants dies before final judgment, the suit proceeds against the survivors. (2 R. S. 307, 308, § 1, 2d ed. 2 Dunl. Pr. 747.) On demurrer the indebtedness of Kenyon and Ballantyne must be assumed to be joint. If Ballantyne was surety, still his indebtedness to the complainants was joint. The representatives of a deceased joint debtor, though discharged at law, are liable in equity. (1 Chit. Pl. 37, 38, 79, 80, and notes. 1 Caines’ Cas. in Err. 122.) The remedy against Kenyon, the survivor, has been exhausted at law i ■ and the remedy against the representatives of Ballantyne is now perfect. (1 Caines’ Cas. in Err. 121.)
   The Chancellor.

Even if the decision was right in relation to the demurrer in this case, there was nothing to justify the making of a final decree without giving the defendants an opportunity to come in and deny the allegations made against them in the bill. In that respect therefore the decree appealed from is clearly erroneous.

But I think the order overruling the demurrer was itself erroneous, as there is no distinct averment in the bill that the claim for which the complainants recovered a verdict and judgment against Kenyon, as survivor, after the death of Ballantyne, was in fact a debt which was due from Kenyon and Ballantyne jointly at the time of the death of the latter. The recital of the recovery of the judgment against the survivor, which in the record of the judgment, of course purports to have been obtained upon a joint promise, is not such an averment of the existence of a joint debt as the defendants could safely take issue upon. For the production of the judgment record itself woúld establish all that is alleged in the bill, even if there never was in fact any joint indebtedness originally. A verdict obtained against the survivor, after the death of Ballantyne, was no evidence of a joint indebtedness against the latter. For his representatives had no right to interfere with the suit in any way, either to contest the existence of a joint promise originally, or if one had existed to show that it was performed, or that Ballantyne had been discharged therefrom before the commencement of that suit. A mere admission by Kenyon, who was wholly destitute of property, that he and Ballantyne were jointly liable, would have been sufficient to entitle the complainants to a verdict against him as survivor. (Sangster v. Mazaredo, 1 Stark. Rep. 161. Whitney v. Sterling, 14 John. Rep. 215.)

The complainants upon showing the existence of a joint debt against Kenyon and Ballantyne at the time of the death of the latter, and showing also, as he has done in this bill, that Kenyon is wholly destitute of property, will have an undoubted right to claim payment out of the property of the decedent, whether such debt was a partnership debt or a joint indebtedness of any other description. But to entitle the complainants to any relief against the estate of the decedent they must amend their bill, by stating the existence of a joint indebtedness by Kenyon and Ballantyne to them, and stating the nature and particulars of that indebtedness, in the same manner as if no suit had ever been commenced thereon ; to enable the defendants to make a proper defence thereto if they have any. And if such indebtedness is not admitted by the answer, the complainants must be prepared to establish it by proof in the ordinary way.

The decree appealed from is therefore reversed with costs, and the demurrer allo’wed. And the complainants must pay the costs, including the costs upon the demurrer, and amend their bill within sixty days, or the bill must be dismissed with costs to be taxed.

Decree accordingly.


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    Ellsworth vs. Curtis and others.
    1843. January 23.
    A defendant cannot, by a disclaimer, deprive the complainant of the right of requiring a full answer from him, unless it is evident that the defendant ought not, after such disclaimer, to be continued a party to the suit.
    Where the complainant is entitled to an answer, and the defendant puts in a simple disclaimer, the proper remedy is to move to take the disclaimer off the files. But where the disclaimer is accompanied by an insufficient an. swer, the proper course appears to be, to except to the answer on the ground of its insufficiency.
    Where a corporation is made a party to a suit in which it has no interest, and to which it ought not to have been made a party, an officer of the corporation who has no personal interest in the controversy, and who is not charged with any fraud or misconduct, cannot be compelled to answer matters as to which he is a mere witness.
    This was an application by the complainant to take the defendant’s answer and disclaimer off the files' of the court. An original bill had been filed by Curtis and two others of the defendants, as assignees of a bond and mortgage given by Ellsworth to the North American Trust and Banking Company, an association under the general banking law of 1838, to foreclose the mortgage j in which suit Talmadge, the president, and Leavitt the receiver of the property and effects of the company, were made defendants, as having or claiming some interest in the subject matter of that suit. The complainant in this suit thereupon filed his cross bill against Curtis and his co-assignees, and against Talmadge and Leavitt, charging, among other things, that the North American Trust and Banking Company was not duly organized, that the bond and mortgage which was given to a former president of that company, or one who claimed to be president, was improperly obtained by him, and was assigned to Curtis and his co-assignees without authority. The bill prayed a discovery of various matters stated in the cross bill relative to the transactions of the company; and that the right of the defendants, or of any of them, to the bond and mortgage, might be determined by an issue to be tried by a jury; that such bond and mortgage might be delivered up and cancelled ; and that Curtis and his co-assignees, Talmadge as president of the Company, and Leavitt as the receiver, be decreed to release all interest in the mortgage or mortgaged premises, upon such terms and conditions as should be just j or for such other or further relief as should be agreeable to equity.
    To this bill the defendant Talmadge put in an answer and disclaimer, stating the organization of The North American Trust and Banking Company, under the articles of association set forth in a schedule annexed to the bill, and that at the time of the appointment 'of Leavitt as receiver of the property and effects of such association, Talmadge was the president thereof. He then set out the appointment of Leavitt as receiver, and the injunction issued by the chancellor restraining the association and its officers and agents from exercising any of its privileges or franchises ; and an order of the court directing the association and its officers to transfer and deliver over to the receiver all the property and effects of the "association; under which order the association, by its president and1 cashier, had assigned and transferred to the receiver all its property and effects. The answer admitted the execution of the bond and mortgage by Ellsworth,, to the former president of the company, and an assignment thereof by such president to Curtis and his, co-trustees, And the defendant insisted that if any beneficial interest remained in the association, after such assignment, in the bond and mortgage, the same passed to and became vested in Leavitt the receiver, by virtue of his appointment and the assignment to him under the order of the court 5 so that no estate or interest legal or equitable remained or was vested in the said Talmadge as president of such association or otherwise, after that time. And the defendant also averred that he had not as president of the association, or otherwise, at any time since the appointment of the receiver and the assignment to him, owned, or claimed, or pretended to have, own, or claim, any right or interest in the complainant’s bond and mortgage or in the mortgaged premises, or in the moneys secured or alleged to be secured thereby, and he thereby disclaimed all right or interest therein; concluding Ms answer and disclaimer by a denial of confederacy, and with a general traverse as in an ordinary answer.

      J. Ellsworth, complainant, in person.

      O. L. Barbour & N. Hill, jun. for defendant.
   The Chancellor.

The answer and disclaimer in this case are the whole bill; and if there is any allegation that the complainant is entitled to have answered, his proper course is to except to the answer for insufficiency. For the defendant cannot, by a disclaimer, deprive the complainant of the right of requiring a full answer from him, unless it is evident that the defendant ought not, after such disclaimer, to be continued a party to the suit. (Welf. Eq. Pl. 255. Glassington v. Thwaites, 2 Russ. Rep. 458.) In a recent case before Lord Cottenham, where the defendants, who attempted to disclaim, were charged with having by a false claim prevented the complainant from obtaining a fund, in the hands of trustees, without the aid of the court of chancery, which charge if proved would have rendered them liable for costs, his lordship seemed to think it a proper case for a motion to take the answer and disclaimer off the file. (Graham v. Coape, 3 My. & Cr. Rep. 642.) But that was a mere intimation at the close of the argument, and is not supported by the case of De Beauvoir v. Rhodes, which he afterwards referred to as having been decided by Sir John Leach. That was, a case of simple disclaimer, unaccompanied by an answer j according to the statement of it by Lord Cottenham. Exceptions cannot be filed to a simple disclaimer. The only remedy of the complainant who is entitled to an answer, in such a case, is to move to take the disclaimer off the files. But where the disclaimer is accompanied by an insufficient answer, the proper course appears to be to except to the answer, on the ground of insufficiency. Upon the merits also I am inclined to think that the complainant is wrong. The defendant’s disclaimer and answer appears to have been filed in good faith. He has answered, so far as he deemed it necessary to show that although, as president of the association, he once had an interest in this bond and mortgage, if the assignment to the trustee by his predecessor was invalid, such interest had been entirely divested by the subsequent appointment of a receiver, and the assignment of the whole effects of the association to that receiver for the benefit of its creditors and stockholders. And I do not find any thing in the complainant’s bill charging the defendant Talmadge with having violated his duty as president of the association, so as to entitle the complainant to a decree against him personally, even for costs. I doubt, therefore, whether the complainant can even except to this answer successfully. For if the association has no interest in this controversy, and ought not to have been made a party after all its rights and interests had been transferred to the receiver, it seems to follow that an officer of such association who has no personal interest in the controversy, and who is not charged with any fraud or misconduct, cannot be compelled to answer matters as to which he is a mere witness. (How v. Best, 5 Mad. Rep. 19.)

The motion to take the answer and disclaimer' off the files, is therefore denied, with $8 costs. But the complainant is at liberty to except to the answer, within the usual time after this decision, if he shall be advised to do so.


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    Harris vs. Williams.
    Where the complainant, in a simple bill of discovery, asks for a discovery from the defendant previous to the filing of his bill, which discovery is material to the prosecution or defence of his rights at law, and it is refused by the defendant, if the discovery thus asked for is afterwards drawn from the defendant by his answer to the bill, such defendant is not entitled to costs against the complainant.

      1843. January 30.
    This was an application to dissolve the injunction, upon the coining in of the defendant’s answer to a bill of discovery, and for costs. The application for costs was resisted upon the ground that the defendant had refused to make the discovery sought until it was drawn from him by the complainant’s bill.
    I. Harris, complainant, in person.

      J. Rhoades, for the defendant.
   The Chancellor.

The defendant in this case is not entitled to costs. The complainant was entitled to the discovery wuthout suit, as it was material to the maintenance of his rights at law. And it having been refused by the defendant without any sufficient excuse, and the complainant having obtained it by the aid of this court, the defendant must bear his own costs of the answer and of his other proceedings in this suit.

Order accordingly.


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    The Ontario Bank vs. Schermerhorn and others.
    The provision of the revised statutes directing that mistakes in stating any day, month, or year in any pleading or record, which could be amended by the court after verdict, in any cause, shall be disregarded upon the trial, unless the mistake or variance be calculated to surprise or mislead the adverse party and to prevent his preparation for a full answer on the merits, applies to a mistake in setting out the date of the deed or instrument which is the foundation of the suit.
    The principle of this provision is applicable to the court of chancery; and in that court, if the adverse party could not have been misled by a mistake in a date, the complainant’s bill should not bo dismissed or the defendant’s defence rejected by reason of a mere clerical- mistake of this kind, where upon the face of the record the variance will not render the complainant’s claim to relief, or the defendant’s defence, bad in substance.
    But at the request of the adverse party, and to remove all danger of his being made liable a second time, the original pleading on file will, at the hearing, be amended by conforming it to the true date.

      1843. February 21.
    The taking a compensation for the difference in exchange, where a loan ,. made in a draft on a distant place, which draft is wanted for the pur. pose of being actually used there and not as a mere cover for usury, is not illegal.
    Notes and drafts not negotiable, and which therefore cannot be used and circulated as money, although made payable after date and with interest, may be issued by banks and banking associations, in the course of their business, either as evidences of indebtedness to particular individuals, or for other legitimate purposes; such notes and drafts not being within the mischiefs intended to be guarded against by the statutory provisions prohibiting the issuing of post notes by banks and banking associations.
    This was an appeal, by the defendant Schermerhom, from a decree of the vice chancellor of the eighth circuit in a foreclosure suit. The complainant’s solicitor, in the copy of the bill served on the defendant’s solicitor, made a mistake in stating the month in which the obligation and mortgage bore date; by substituting April for August. The defendant therefore denied the execution of the note and mortgage stated in the complainant’s bill; but he admitted the execution of a similar note and mortgage, which were dated in August, 1837, and not in April of that year as stated in the bill. He also, in his answer, set up as a defence to the note and mortgage stated therein, that they were void for usury. The defendant also set up as a defence to the suit, that a part of the consideration of the bond and mortgage was a note which had been discounted by the bank some time previous, and which was due and unpaid at the time of giving the note and mortgage in controversy in this suit; and that upon the discounting of such previous note, it was corruptly and unlawfully agreed between him and the bank that he should receive the proceeds therof in a draft on Albany or New-York, payable in thirty days, and should also allow a premium on such draft. The defendant further alleged that pursuant to such agreement, he received a draft from the bank, payable in New-York or Albany thirty days after date, and that he paid a premium on such draft in addition to the legal discount on the note. But the date and amount of the draft, the persons on whom it was drawn, and the place where it was made payable, were not stated in the answer. Nor was it stated whether it was a negotiable draft, or whether the defendant had or had not actually received the money thereon previous to the giving of the mortgage and note to obtain satisfaction of which this suit was brought. The defendant in his answer insisted, however, that the draft received by him, upon the discounting of that note, was issued contrary to the provisions of the safety fund act of April 2d, 1829, and that the note thus discounted and the loan for which it was given were wholly void. But the defendant failed in proving the case as stated in his answer. For the cashier of the bank, the only witness called by him, testified that the defendant Schermerhorn applied for a loan to pay a debt in the city of New-York/and was offered a draft at sight at one per cent premium, which was the actual difference in exchange between Canandaigua and New-York at that time, or a draft at thirty days at par, and that he finally received a draft at forty-five days at a discount of about $29, instead of being charged a premium.

      L. H. Sandford, for the appellant.

      Azor Taber, for the respondent.
   The Chancellor.

The objection, that the date of the note and mortgage are not correctly stated in the copy of the bill served on the defendants, is merely technical; although for the purpose of this appeal, the court must presume the bill served was a copy of the original bill on file. The legislature has provided, by statute, that mistakes in stating any day, month, or year, in any pleading or record, which according to law could be amended by the court after verdict rendered in any cause, shall be disregarded upon the trial; unless such mistake or variance be calculated to surprise or mislead the adverse party, and to prevent his making due preparation for a full answer on the merits to the matter concerning which such mistake shall have been made. (2 R. S. 407, § 79.) In the case of Morris v. Wadsworth, (17 Wend. Rep. 103,) the supreme court decided that this statutory provision was applicable to a mistake in setting but the date of the deed or instrument which was the foundation of the suit. And upon a re-examination of that case in the court for the correction of errors, in December, 1838,1 arrived at the conclusion that the supreme court had given the correct construction to this provision of the revised statutes. Such also must have been the opinion of a majority of the members of that court; as the judgment was affirmed by a tie vote, although I voted for a reversal upon the ground that the circuit judge who tried the cause had erred upon another point.

This statute does not in terms extend to this court, and was only intended to regulate the practice upon the trial of issues in fact before the jury. But the decisions upon which this statutory provision was based show that the principle is applicable to this court as well as to courts of law; and that in .a case where it is perfectly evident that the adverse party could not have been misled by a mistake in a date, the complainant’s bill should not be dismissed, or the defendant’s defence rejected, by reason of a clerical mistake of this kind, when upon the face of the record the variance will not render the complainant’s claim to relief, or the defendant’s defence, bad in substance. (See Rees v. Overbagh, 4 Cowen’s Rep. 124. Daly v. Atwood, 7 Idem, 483. Kimball v. Huntington, 7 Wend. 472.) If the appellant apprehends there is danger that he may be made liable a second time for the note or mortgage, on account of this clerical mistake, he may have the original bill on file which is to constitute a part of the enrolled decree amended, so as to conform to the true date, if it is not already right in that respect. And that would have been allowed by the vice chancellor as a matter of course, at the hearing, if the defendant or his counsel had asked for it. It therefore forms no ground for reversing the decree upon this appeal. For the answer showed that the defendant could not have been misled by the clerical mistake in substituting the word April for August.

There Is no pretence of usury in this case upon the proof produced by the defendant. The witness swears that the defendant, when he applied for the loan in the spring of 1837, stated that he wanted it to pay a debt in New-York. And the defendant’s letter shows that he asked for a draft for $10,000 j the difference in exchange between New-York and Canandaigua being then one per cent in favor of the former place. The draft was payable at forty-five days; which if taken at par would still have been something less than three-fourths of the actual difference in exchange, estimating the interest on the draft, for the forty-five days, at the rate of seven per cent per annum. But the testimony shows that the defendant received a compensation for fifteen days’ interest on the draft; so that he was in fact charged one half of one per cent for the difference in exchange between the two places, or something less than that. And it is well settled that the taking of a compensation for the difference in exchange, where a loan is made in a draft on a distant place, and which is wanted for the purpose of being actually used there and not as a mere cover for usury, is not illegal.

The proof in relation to the agreement to discount the $10,000 note, of April, 1837, and as to the nature and terms of the draft which was received by the defendant as the proceeds of such note, is so materially variant from the case as stated in the answer, as to render it doubtful whether I ought to consider the question as to the right of the bank to give a draft on time. But as that objection to the validity of one of the notes, which constituted a part of the consideration of the mortgage, was urged upon the court with considerable confidence by the appellant’s counsel I will proceed to examine it. The prohibition in the safety-fund law of 1829 is general, that no monied corporation subject to the provisions of that act shall issue any bill or note of the said corporation unless the same shall be made payable on demand and without interest. (1 R. S. 2d ed. 612, § 35.) The object of the legislature, in the adoption of this provision, undoubtedly was to prevent the banks from issuing post notes or post bills of exchange which might pass from hand to hand as a part of the circulating medium of the country. And experience has often shown that the negotiable securities of banking institutions, in whatever form and for whatever purposes they may have been issued, will pass from hand to hand as a substitute for money so long as the banks which issued them continues to be in good credit. The only safe course, therefore, in construing this restrictive clause of the safety fund act, so as to guard against the mischief intended to be remedied thereby, and thus to carry into effect the intention of the legislature, is to give it a literal construction so far as relates to negotiable bills and notes of every kind and description. And the corresponding provision in the amendment of 1840 to the general banking law, (Sess. Laws of 1840, p. 306, § 4,) should receive the same literal construction ; to remedy the mischiefs against which that provision was directed.

But notes and drafts not negotiable, and which for that reason cannot be used or circulated as a substitute for money, when issued by banks in the course of their business, either as evidences of indebtedness to particular individuals or for other legitimate purposes, are clearly not within the mischiefs which the legislature intended to guard against by these prohibitory provisions ; although the language used by the legislature is broad enough to cover that kind of securities also, where they assume the character of promissory notes or bills of exchange. In the case under consideration it is not stated in the defendant’s answer, nor does it appear by the proofs, that the draft on New-York which the defendant received, upon the discounting of the note of April, 1837, was negotiable. And in the absence of proof that it was issued in such a form as to violate the spirit and intent of the statute the court is bound to presume the contrary was the fact. It is unnecessary, therefore, to express an opinion upon the question whether the taking of a new security for the repayment of money which had been received by the defendant upon an illegal draft would not of itself bar the defence which might have been set up to a note which formed a part of such an illegal agreement originally.

The decree appealed from must be affirmed with costs.


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    The Bank of Rochester vs. Emerson and others.
    1843. February 21,
    Where a creditor’s bill was filed against a mortgagor to obtain satisfaction of the amount of the deficiency, on a sale of mortgaged premises, under the usual decree over against him for the payment of such deficiency, and the bill stated the making of the report by the master of the amount of the deficiency, as by such report duly confirmed by the court and on file would appear, and also stated the issuing of an execution and its return unsatisfied, and the defendant pleaded in bar, that the report of the master as to the deficiency, had neither been filed nor confirmed when the execution was issued for such deficiency; Held that the plea formed a good defence to the suit.
    ICJpon the usual decree over against a mortgagor, or other defendant who is no personally liable for the mortgage debt, for the amount of the deficiency, execution can regularly issue against him previous to the filing and confirmation of the master’s report of such deficiency. Therefore where a creditor’s bill was filed on such a decree, and upon the return of an execution issued thereon before the master’s report of the deficiency was confirmed, the bill was dismissed, but without prejudice to the right of the complainant to file a new bill.
    The order to confirm the master’s report of the amount of the deficiency, which is entered upon the filing of the report, is an order nisi, and does not become absolute until the expiration of eight days from the time of its entry.
    This was an appeal from a decretal order of the vice chancellor of the eighth circuit allowing a plea. The Bank of Rochester filed a bill against the defendant Emerson, to foreclose a mortgage given by him, and obtained the usual decree over against him for the deficiency in case the proceeds of the mortgaged premises should be insufficient to pay the debt and costs. And the bill in the present suit was an ordinary creditor’s bill to obtain satisfaction of the amount of such deficiency. The bill, after stating the decree, the sale of the mortgaged premises by the master, and the application of the proceeds of such sale towards the payment of the debt and costs, further stated that the master reported, that on the 18th of December, 1841, the dar of the date of his report, there remained due to the complainant for such deficiency $1896,89 • as by the report of the master, duly confirmed by the court and on file in the office of the clerk of the 8th circuit would more fully appear. The bill then set out the issuing of an execution, for such deficiency, on the 10th of January, 1842, returnable on the 14th of the same month ; which execution was afterwards returned unsatisfied. To this bill the- defendant Emerson pleaded in bar, that the report of the master as to the deficiency had neither been filed nor confirmed at the time when the execution was issued for such deficiency, as was untruly alleged in the complainant’s bill.
    The vice chancellor allowed the plea and ordered the bilí to be dismissed, without prejudice to the right to file a new bill; if the complainant should not elect to take issue upon the plea, as authorized by the 47th rule of the court. From this decision of the vice chancellor the complainant appealed.

      F. M. Haight, for the appellant.
    O. Hastings, for the respondent.
   The Chancellor.

The question raised by the plea in this case is not one of mere irregularity in the execution j for the court does not determine questions of irregularity in a collateral suit. But the plea shows that at the time this execution issued, and for aught that appears to the contrary at the time it was returned by the sheriff unsatisfied, there was no decree of the court authorizing the issuing of an execution for the deficiency reported due upon the master’s sale. The decree stated in the complainant’s bill is not like a judgment at common law ; which, when entered, relates back to the term of the court at which it was pronounced, so as to authorize the issuing of an execution tested as of that term. Even in the case of a judgment, however, the statute does not allow the issuing of an execution until after the record of the judgment is actually filed. (2 R. S. 360, § 11. Marvin v. Herrick, 5 Wend. 109.) And the case of Barrie v. Dana, (20 John. Rep. 307,) referred to in the opinion of the vice chancellor, shows that it was irregular to issue an execution before the actual filing of the judgment record, even previous to the statute.

Here the decree does not direct the mortgagor to pay the deficiency when it shall be ascertained by the result of the sale, or when the master shall have made out and signed his report. Nor does the filing of the report of the master, stating the amount of the deficiency, entitle the complainant to demand the immediate payment of such deficiency, so as to authorize the issuing of an execution therefor. The decree is that the mortgagor, or other defendant who is personally liable for the mortgage debt, pay the amount of the deficiency reported due, upon the coming in and confirmation of the report of the master. Until the master’s report is confirmed as well as filed, therefore, the deficiency is not payable under the decree j and of course no execution can issue against the property of the defendant previous to that time.

In the case of Marvin v. Herrick, before referred to, the late chief justice intimates that the execution, though a mere nullity until the record was filed, might become operative in the hands of the sheriff from the time of such filing, although delivered to him previously. But even such a principle if adopted in this case would not help the appellant. For the plea contains two averments which, taken together, show that the deficiency was not payable, by the terms of the decree, until after the return day of the execution. The bill states the issuing of an execution on the 10th of January, 1842, returnable on the 14th, and which was actually returned by the sheriff unsatisfied on the 16th of the samejnonth. And as the plea avers that the master’s report was neither confirmed nor filed at the time of issuing the execution, it could not have been confirmed, according to the settled course of the court, at any time previous to the actual return of the execution by the sheriff. For, by the 110th rule of the court, the order which is to be entered upon the filing of the report is an order nisi, and that does not become absolute until the expiration of eight days from the time of the entry of such order.

The objection that the plea is double does not appear to be well taken. The plea does not set up two good defences to the bill, but two facts merely which go to establish one point, to wit, that the decree for the payment of the deficiency had not become absolute at the time of the issuing the execution, or at any time afterwards while such execution could be legally levied on the defendant’s property. Nor do I think it is a case in which the defendant could have protected himself by a demurrer. For upon - the allegations in the bill, uncontradicted and unexplained, I think the court would have inferred that the deficiency had become due and payable, according to the terms of the decree, previous to the issuing of the execution on the 10th of January, 1842.

The decretal order appealed from must therefore be affirmed with costs,


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    Jarvis & Lobdell vs. Peck and others.
    An answer to a suit upon a bond and mortgage, that the only consideration for such bond and mortgage was an agreement in restraint of trade, which was void as against public policy, is not sustained by proof that such an agreement formed only a part of the consideration for which the bond and mortgage were given.
    A person who is engaged in a particular trade or business may agree to relinquish the same to another, and may lawfully covenant not to carry on the same trade or business in such a manner as materially to interfere with the profits of the one to whom he has sold and transferred his business.
    The principle upon which a contract in general restraint of trade is held to be void, as against public policy, is that such a contract deprifes the public of the enterprise and skill of one of the parties to the contract, and injures him, without any corresponding benefit to the party contracting for such restriction.
    Although the policy of the law does not permit general agreements in restraint of trade, a person who is engaged in a particular business, which he is carrying on by means of a secret process which he has discovered, may sell the secret to another, and may lawfully contract with the purchaser that he will not thereafter use that secret in such business without the consent of the purchaser, and will not disclose the secret to others.
    1843. February 21.
    In a Suit ujjoii a bond and mortgage which upon their face import a good consideration, it is not necessary for the complainant to prove what the real consideration was; but it lies upon the defendant, wht? attempts to impeach them, to show that they were given without consideration, or that the consideration was illegal.
    It seems that if a part of the consideration of a bond for the payment of money is good, and another part of the consideration is illegal by the principles of the common law, as being against public policy, but is not made illegal by statute, the bond is valid.
    This was an appeal from a decree of the assistant vice chancellor of the first'circuit, in a foreclosure suit. The complainants’ bill was filed to obtain satisfaction of the balance due upon a bond and mortgage dated on the 11th of March, 1836, but actually executed three days thereafter, conditioned for the payment to Jarvis & Tremain, the original mortgagees, of the sum of $2000, in February 1835. The bond was executed by the defendants Gunn & Peck, and the mortgage by Peck and wife. The answer of the defendants admitted the execution of the bond and mortgage, but set up as a defence to the suit that the consideration of the bond and mortgage was neither money nor .property, but was a bond or agreement executed by the mortgagees to the defendant Gunn and one W. Trimble, on the 14th of March, 1836, in the penalty of $100,000. The condition of that bond, or agreement, which was set out at length in the answer, recited that W. Trimble had been instrumental in making Jarvis & Tremain, the obligors, acquáinted with the skill of converting cast iron into malleable iron, and that he and they had been copartners in that business, which partnership had been dissolved by mutual consent, by reason and in consideration whereof Trimble & Gunn had secured to Jarvis & Tremain the $2000 specified in the bond and mortgage above mentioned. And the condition of the bond then stated, that in consideration thereof Jarvis & Tremain wrere bound not to carry on said business themselves, nor by their agents, in any place whatever, nor to work at that business without the consent oí Gunn & Trimble or one of them ; and were also bound not to make known the said skill to any other person whatever, either directly or indirectly. It appeared also from the answer, and the proofs, that previous to the 14th of March, 1836, Jarvis & Tremain had been taken into copartnership with Trimble and C.'Adams, in the business of converting cast iron into malleable iron, by the use of some secret skill, and had at the time they were so taken into the partnership taken an oath before a magistrate not to disclose to any person the secret skill they should obtain from the co-partners, except by a mutual agreement between them ; and that the copartnership was dissolved at the time of giving the bond and mortgage, and the execution of the $100,000 bond or agreement.
    The assistant vice chancellor decided that the bond and mortgage were founded upon a good and sufficient consideration, and that the agreement on the part of the mortgagees, executed at the same time, although in general restraint of trade, did not render the bond and mortgage illegal and void; and a decree was entered accordingly. From that decree the defendants appealed.

      A. Taber, for the appellants.
    The consideration of the mortgage is the bond executed by Jarvis & Tremain to Gunn & Trimble, which bond being in restraint of trade generally, is illegal and void, and consequently the mortgage cannot be enforced. (Mitchell v. Reynolds, 1 P. Wms. 181 ; 10 Mod. 130, S. C. Heanlocke v. Blacklowe, 2 Saund. 156, n. 1. 2 Saund. on Pl. & Ev. 577. Chesman and wife v. Nainsly, 2 Stra. 739; 2 Ld. Raym. 1456, S. C. ; 2 Bro. P. C. 349, S. C. Davis v. Mason, 5 T. R. 118. Bunn v. Gay, 4 East, 190. Gale v. Reed, 8 East, 80. Hardy v. Martin, 1 Bro. C. C. 419, n. Willes, 384. The Master, Wardens and Society of the Mystery of Gunsmiths of the City of London v. Fell, Cas. Temp. Hard. 53. 2 Esp. N. P. 15, 16. Thompson v. Harvey, Show. 2. Colgate v. Bachelor, Cro. Eliz. 872. 2 Cro. 596. Allen, 67. Moore, 115, 242. 2 Bulst. 136. Com. Dig. tit. Trade, p. 3. Com. on Cont. pt. 2, ch. 10 ; pt. 1, ch. 4. Hearn v. Griffin, 2 Chit. Rep. 407, 7 Petersd. Abr. 83. 8 Mass. Rep. 223. 9 Idem, 522. Pierce v. Woodward, 6 Pick. 206. Petre v. Thomas, 4 Bibb, 486. Noble v. Bates, 7 Cowen, 307. Smith v. Smith, 4 Wend. 468. Pennington v. Townsend, 7 Idem, 276. 14 John. 273. Thalmer v. Brinkerhoof, 20 Idem, 397. Bank of U. S. v. Owen, 2 Pet. 527. Chappel v. Brockway, 21 Wend. 157. Rossv. Sadgbeer, Idem, 166.)
    The complainants are seeking the aid of this court to enforce the performance of an illegal and void contract, to wit, the foreclosure of the mortgage and the collection of the bond accompanying it. This cannot be done either at law or in equity, Jarvis is particeps criminis, and Lobdell, the assignee of Tremain, is in no better situation than his assignor. (Com. on Cont. pt. 1, ch. 4, p. 53. Collins v. Blanton, 2 Wils. 341, 347. 1 P. Wms. 156, 220. Hunt v. Knickerbacker, 5 John. 324. Pennington v. Townsend, 7 Wend. 276. Bank of the U. S. v. Owen, 2 Peters, 527. De Groot v. Van Deusen, 17 Wend. 170. 1 Com. on Cont. 30. Holman v. Johnson, Cowp. 343. Belding v. Pitkin, 2 Caines, 149. Woodworth v. Jones, 2 John. Cas. 417. Wkitaker v. Cone, Idem, 58.) Lobdell is not protected by the assignment against the illegality of the consideration of the mortgage. He took it subject to all the equities existing between the original parties to it, whether he had notice or not. (Estep v. Watkins, Bland's Ch. R. 486. Murray v. Lylburn, 2 John. Ch. 441. Livingston v. Dean, Idem, 479. Clute v. Robinson, 2 John. 595. Murray v. Governeur, 2 John. Cas. 438. Webster v. Wise, 1 Paige, 391. Covel v. Tradesman's Bank, Idem, 131. Peacock v. Rhodes, Doug. 636. Root v. French, 13 Wend. 575. Sugd. on Vend. 482. Whitfield v. Faussett, 1 Ves. 387. George v. Milbanke, 9 Ves. jun. 190.) The bond and mortgage were given as a consideration for the covenant not to work at the business, and not to disclose the secret. The first part of the consideration is confessedly bad; we insist the second part is equally so as against public policy. But if we are wrong in this, the court cannot say how much or what portion of the $2000 was for the first, and what portion for the second part of the covenant. It would be unjust to place it all upon the latter part, and there is no- rule by which the court can apportion it. The conclusion to which the vice chancellor arrived, would open the door to a fraud on the law in all cases. (5 Taunt. 727. Colshil's case, 3 Coke, 82. 6 Cowen, 481. 3 Bibb, 497. 5 Serg. & Rawle, 139. 4 Rawle, 187.)

      C. Stevens, for the respondents.
    The bond and mortgage are good and valid securities, and are a legal lien upon the premises mentioned in the mortgage. The matter set up in the defendant’s answer by way of defence is not sufficient to defeat the bond and mortgage, or in any manner to affect the consideration. There is no proof that the bond and mortgage are the same mentioned in the bond from Jarvis & Tremain to Trimble & Gunn; nor is there any proof that the covenants in the bond of Jarvis & Tremain were the sole consideration for the bond and mortgage. But if the covenants in the bond of Jarvis & Tremain were the sole consideration for the bond and mortgage, the bond and mortgage are valid, as these covenants are good. There is at least one good and valid covenant in the bond of Jarvis & Tremain, to wit, the covenant “ not to disclose the secret,” &c, which was and is a consideration to sustain the mortgage. (Morris v. Coleman, 18 Ves. 437. Bryson v. Whitehead, 1 Sim. & Stu. 74 . Green et al. v. Folsham, Idem, 398. Stra. 739. 2 Ld. Raym. 1456. Folkes v. Dominique, 2 Stra. 1137. 3 Law Lib. 254, 568, marg. as to covenants void at common law.) The bond shows a sufficient consideration for giving the bond and mortgage, independent of the covenant, to wit, the dissolution of the partnership and the withdrawal of Jarvis & Tremain from the firm. The complainants are only required to show a valuable consideration for the mortgage, not an adequate consideration. (Huson v. Pitman, 2 Hayw. 332.)
   The Chancellor.

I think the defendants failed in this case in proving the defence set up in their answer. The substance of the defence is that the only consideration for the bond and mortgage was an illegal agreement, in restraint of trade1,’ and that such agreement being void as against public policy there was in fact no consideration whatever for the bond and mortgage. Upon such an answer, if the defendants fail in proving that the $100,000 bond was the sole consideration, I do not think they are at liberty to insist that their proofs make out a defence of a different character | to wit, that the bond and mortgage were void because they were given in part to carry into effect an agreement which was against public policy. Independent of this formal objection to the manner in which that question is brought before the court in this ease, however, I think there was no illegality or want of consideration ; and that the principles upon which certain agreements in restraint of trade are held to be void, as being against public policy, do not apply to such a case as this was.

It is perfectly well settled that a man engaged in a particular trade or business may agree to relinquish the same to another ; and he may lawfully covenant not to carry on the same trade or business in such a manner as materially to interfere with the business or profits of the one to whom he has sold out. (Nobles v. Bates, 7 Cow. Rep. 307. Perkins v. Lyman, 9 Mass. Rep. 522. Hayward v. Young, 2 Chit. Rep. 407. Davis v. Mason, 5 Term Rep. 118. Mitchell v. Reynolds, 1 P. Wms. Rep. 181.) In delivering the opinion of the supreme court, in the case of Chappel v. Brockway, (21 Wend. Rep. 159,) Mr. Justice Bronton states the true reason why contracts in general retraint of trade are repudiated as contrary to public policy ; which is that they deprive the public of the enterprise and skill of one of the parties, and injure him, without any corresponding benefit to the party contracting for such restriction. The contract injures one party without benefitting the other.

But in the case under consideration it is very evident the parties contracted upon the basis that the parties to whom the $100,000 bond was given had purchased out the share or interest of Jarvis & Tremain in the secret, which before belonged to the copartnership, of converting cast iron into malleable iron by some process which was known only to themselves. And the business which the agreement intended to restrain the mortgagees from carrying on, was that of converting cast iron into malleable, as it had previously been done by the copartnership, by means of this secret process. But to carry into efféct the intention of the parties without disclosing the secret to the world, the language of the bond necessarily must be made general. Such an agreement was upheld by Sir John Leach in the case of Bryson v. Whitehead, (1 Sim. if Stu. Rep. 74.) And a specific performance of the agreement was there decreed, although it contained a general restriction, as in this case, that the complainant would not carry on the business in which the secret was used; and that the complainant would also procure another person to enter into a similar engagement with the defendant. His honor in that case says, <£ Although the policy of the law will not permit a general restraint of trade, yet a trader may sell a secret of business and restrain himself generally from using that secret.”

Here it does not distinctly appear what the real consideration of the $2,000 bond and mortgage was, or how the defendant Gunn was to be benefitted by the dissolution of the copartnership which had been previously carried on by means of this secret. But enough appears to show that the giving of the $100,000 bond was not the only consideration, if indeed it formed any part of the consideration of the bond and mortgage. The condition of the bond and mortgage to Gunn & Trimble recites that the copartnership in which Jarvis & Tremain had been interested, with Trimble & Adams, had been dissolved by mutual consent j by reason and in consideration whereof, Trimble & Gunn had secured them the $2,000. It may therefore be fairly inferred that the relinquishment of the interest of the mortgagees in the good will of the business which was carried on by means of this secret process, was the true consideration for which the bond and mortgage was given; and that by some arrangement between Gunn & Trimble, the former was to be thereafter substituted in the place of Jarvis & Tremain in the carrying on of the business, by means of the secret, either at the same place or elsewhere. It is not necessary, however, for the complainants to show what the real consideration of the bond and mortgage was. For as they upon their face import a good consideration, the defendants hold the affirmative of showing that they were given without any valid consideration.

Assuming then that the relinquishment of the interest of the mortgagees in this business, and in the secret which constituted a part of that interest, to Trimble & Gunn, to have formed a material part of the consideration of the bond and mortgage, I think the agreement of the mortgagees that they would give to Trimble & Gunn the full benefit of the secret which they had purchased, by refraining from engaging in the business themselves or as the agents or workmen of others, and by keeping the secret by which the business was carried on from the knowledge of others, did not vitiate the bond and mortgage ; even if a stipulation to give the $100,000 bond formed a part of the same agreement. For, as I have before observed, the object of the parties was not to restrain trade, but to insure to the purchasers of an interest in the secret the full benefit of their purchase. And this could not be done by restricting Jarvis & Tremain from carrying on the particular business, in which the secret process was used, within certain specified limits merely. For if the secret was valuable, the purchasers thereof were interested in controlling its use at other places than that in which they should think proper to carry on the business in person. And though they could not carry on the business themselves in every part of the state, they could sell out their secret to others and give to the purchasers thereof the right to use it within particular limits. This, however, could not be done with the same profit to themselves if the restriction upon Jarvis & Tremain was limited to a particular locality. The agreement therefore was not one which imposed an onerous restriction upon Jarvis & Tremain that was of no benefit to the other parties.

Having arrived at the conclusion that the agreement, on the part of Jarvis & Tremain, to keep the secret and not to use it in the business of converting cast iron into malleable iron without the consent of Trimble & Gunn, was a valid agreement, it is not necessary to consider the question upon which the assistant vice chancellor has placed his decision. It will be seen, however, by a reference to the case of Bunn v. Guy, as reported by Mr. Smith, that Lord Ellenborough takes that ground distinctly ; although it is not stated in the report of that case by East. His lordship, at the conclusion of the argument, said, “ Here is a bond for the payment of money, and unless the consideration is bad by statute, the bond is good if any part of the consideration is good.” (See 1 Smith’s Rep. 11.) A similar opinion was expressed by him in the case of Newman v. Newman, (4 Maule & Sel. Rep. 70. See also Pigot’s case, 11 Coke, Thomas & Fraser’s ed., 27, b. and the cases cited in note C.)

The conclusion at which I have come in this case is, that the bond and mortgage were founded upon a good and sufficient consideration, and .that the appellants had no valid defence to this bill of foreclosure. The decree appealed from must therefore be affirmed with costs.