text:
    In the matter of Ganse, a lunatic.
    Where a lunatic left his residence in a state of mental alienation, leaving personal property there, and had gone to some place unknown; Held, that for the purpose of an application to the court of chancery for a commission of lunacy, the lunatic must still be considered as a citizen of the state where he was domiciled at the time he was deprived of his reason.
    The court of chancery has jurisdiction to issue a commission of lunacy where the lunatic has lands in this state, although the lunatic is domiciled abroad.
    March 1.
    This was an application by a creditor of W. Ganse for a commission to inquire as to his lunacy. The petition stated that the supposed lunatic was recently a resident of the town of Fishkill, where he had considerable property, consisting principally if not wholly of personal estate; that after he became deranged, he had left his place of residence and gone to some place unknown to the petitioner or to his friends or relatives; that a letter had been received from him, stating that he should not make known where he was, and that no one could find him, for he was at a great distance from Batavia, though he had made arrangements to get letters which were directed to him at that place.

      J. Rhoades Sf R. W. Peckham, for the petitioner.
   The Chancellor.

The affidavits annexed to the petition in this case appear to establish a clear case of lunacy. And the only question is whether this court ought to issue a commission without some evidence of the fact that he is within the jurisdiction of the court. It was at one time questioned whether the lord chancellor of England could issue a commission where the lunatic was abroad. But since the decision of Lord Hardwicke, in Southcot's case, (2 Ves, sen. 402,) there can be no doubt of the right of the chancellor to issue a commission, where the lunatic has lands within his jurisdiction, although the lunatic is himself domiciled abroad. And the cases of Perkins, (2 John, Ch. Rep. 124,) and of Petit, (2 Paige’s Rep. 174,) establish the same principle here. Stock, in his treatise upon the law of non compos mentis, says: u All persons permanently non compos mentis are proper objects of a commission of lunacy, provided they are natives of or residents in England. Thus a commission may be granted against a foreigner whilst in this country, or against an Englishman whilst out of it.” (Stock’s Non Compos Mentis, 94.)

In this case, the supposed lunatic has several thousand dollars of personal property under the care of his brothers in the county of Dutchess, although there is no distinct allegation that he has any real estate there. And the fact that he was in a state of mental alienation when he left his. place of residence in Fishkill, in February, 1841, renders it wholly improbable that he can have established any legal domicil out of this state since that time. For the purposes of this application, therefore, he must be considered as still a citizen of this state, and a resident at Fishkill, where he was domiciled at the time he was deprived of his reason.

A commission must issue accordingly, as prayed in the petition, and must be executed in the town of Fishkill; and the jury may dispense with having the supposed lunatic before them upon the execution of the commission. But notice of the time and place of executing the commission must be given to one of the brothers of the lunatic residing at that place. The commissioners must also direct a similar notice to be transmitted to Ganse himself, through the post office, directed to him at Batavia, at least twenty days previous to the time when the commission is to be executed.


source: Caselaw Access Project

author: The Chancellor.

license: Public Domain

text:
    Ellsworth vs. Cuyler.
    Under the former statute of this state concerning uses, the equitable inte?* est of the cestui que trust in land was not bound, as against a bona fide purchaser, from the time of the docketing of the judgment against such, but only from the time of issuing the execution upon such judgment.
    Where the equitable owner of land, under a contract, transferred his interest in such land fraudulently, for-the purpose of hindering his creditors in the collection of their debts, and the fraudulent assignee exchanged the land with a bona fide purchaser who afterwards obtained the legal title to such land, without notice of the fraud; Held, that the title of the purchaser could not be impeached by the creditors of the fraudulent assignor ; and that the claim of the creditors who were intended to be defrauded was transferred to the property which such purchaser had given in exchange.
    Under the provisions of the revised statutes, the interest of a defendant in a contract for the purchase of lands cannot be sold on an execution against him; but the remedy of the judgment creditor is by a suit in equity, after his execution at law has been returned unsatisfied.
    March 1.
    This was an appeal from a decree of the vice chancellor of the seventh circuit, dismissing the complainant’s bill •with costs. The bill was filed for the specific performance of a contract for the conveyance of a lot and premises in the village of Penn Yan, known as the American Hotel property. The facts in the case were substantially as follows : In February, 1831, the defendant Cuyler, being the owner of the Penn Yan property, contracted to sell it to C. P. Fulton for $4000. Three fourths of that sum was to be paid by Fulton in a lot and water privilege at the head of the Crooked Lake, in the town of Urbana, for which he then held a deed from Z. Hammond j which Urbana property was to be conveyed to Cuyler free from all liens and incumbrances, simultaneously with the execution of the contract, And Fulton gave Cuyler a deed of that property, the same clay, containing the usual covenants of seisin and warranty; which deed was duly recorded a few days afterwards. The residue of the purchase money was, by the terms of the contract, to be paid in four equal annual payments, from the first of May, 1831, with annual interest from that time; on which day Fulton was to be let into possession of the Penn Yan property. And Cuyler covenanted to give to Fulton or his assigns a good and sufficient deed of that property, upon payment of the whole of that fourth of the consideration of the purchase, whether paid before or at the times mentioned in the contract, and upon Fulton’s making to him a perfectly clear, free and unincumbered title to the Urbana property. Fulton took possession of the Penn Yan property at the time specified, and made large and valuable improvements thereon. In February, 1832, and after the commencement of the suit of Colt as hereafter stated, Fulton sold to Ells-worth his interest in the Penn Yan property, for the consideration of $6000, and assigned to him the contract made with Cuyler therefor.
    Previous to the conveyance of the Urbana property to Fulton, Hammond the former owner had sold it by contract to Tyler, who went into possession. Tyler after-wards assigned his contract to Fulton, who obtained the title from Hammond under that contract. In May, 1831, Colt, a judgment creditor of Tyler, filed a bill against him to recover satisfaction of his judgments j in which suit Fulton and Cuyler and Ellsworth were made parties defendants. In Colt’s bill it was alleged, that Tyler had assigned the contract of the Urbana property, with other effects, to Fulton, for the purpose of defrauding Colt and other creditors of Tyler. That bill also set forth the agreement between Fulton and Cuyler in relation to the sale of the Penn Yan property, and the conveyance of the Urbana property, in part payment therefor; charging the defendants in that suit with knowledge of the alleged frauds of Tyler. And the complainant in that cause prayed, among other things, that the Urbana property which had been conveved to Cuyler, or the lot in Penn Yan which Cuyler had contracted to sell to Fulton, might be charged with the payment of the judgments against Tyler, and might be sold for the satisfaction of those judgments. Tyler and Ellsworth suffered that bill to be taken as confessed against them. Fulton and Cuyler put in their answer, in which the former denied the alleged fraud, and the latter denied all knowledge thereof, and set up the defence that he was a bona fide purchaser, of the Urbana property, without notice that Tyler ever had or claimed any interest therein. Replications were filed to the answers, and that cause was heard on pleadings and proofs, and was pending before the vice chancellor of the seventh circuit, undecided, when the answer of the defendant Cuyler was put in to the bill in the present suit.
    On the 8th of May, 1832, Cuyler, after he had heard of the sale and assignment of the contract for the Penn Yan property to Ellsworth, acting under the advice of counsel, and having ascertained that there were judgments outstanding against Fulton which were liens upon the-Urbana property, in addition to the claim of Colt in the suit which was then pending, gave notice to Fulton of his intention to rescind the contract. And he offered to reconvey the Urbana property to Fulton, upon his delivering up the contract and the possession of the premises in Penn Yan • or to complete the contract for the conveyance of the last mentioned premises, according to the terms of the contract, and to reconvey the Urbana property upon receiving the sum of $3000, at which iffwas taken in part payment, with the interest thereon. On the same day he also served a copy of that notice upon Ellsworth, as the assignee of the contract, and demanded of him the possession of the Penn Yan property. Previous to the making of the contract with Fulton for the sale of the Penn Yan property to him, the defendant Cuyler had mortgaged that property to S. H. Herrick ; which mortgage was outstanding and unsatisfied at the time of the making of the contract; and a part of it, amounting to something more than |1000, was still due at the time of filing the defendant’s answer in this suit. In June, 1832, Ellsworth 'offered to pay to Cuyler the $1000, or, as the defendant stated in his answer, the first instalment on the contract, in a draft on Herriclc the mortgagee ; which offer was declined. The defendant afterwards commenced an ejectment suit against the tenant of Ellsworth, to recover possession of the property in Penn Yan ; which suit was noticed for trial in June, 1833, and the trial was put off on the application of Ellsworth. And the day after the postponement of the trial, Ellsworth tendered to Cuyler the whole $1000 due on the contract, with the interest thereon, and the costs of the ejectment suit, and asked for a deed of the property. But Cuyler told him it was too late, and declined receiving the money tendered. The bill in this cause was filed in November thereafter, and was heard upon pleadings and proofs in 1837. During the pendency thereof the suit of Colt was brought to a hearing before the same vice chancellor, who afterwards made the decree appealed from in this cause. And he made a decree in Colt’s suit, in February, 1834, declaring the assignment from Tyler to Fulton fraudulent; and that Fulton received the assignment for the purpose of aiding Tyler in defrauding his creditors. It was also declared and decreed that Cuyler was a bona fide purchaser of the Urbana property; but as the proceeds of the sale of that property were vested in the purchase of the Penn Yan premises, that Colt the complainant had an equitable claim upon Fulton’s interest in those premises for the satisfaction of the amount due on his judgments, together with his costs in the chancery suit. The decree therefore directed a receiver to be appointed • that the interest of Fulton in those premises be sold for the purpose of satisfying the decree ; and that the defendant Cuyler execute to the purchaser, under such sale, such conveyances and covenants as by law and equity he was bound to execute and deliver to Fulton, on such purchaser’s complying with the terms and conditions of the contract between Cuyler and Fulton within a reasonable time. He also decreed a dismissal of the bill as to Cuyler, with costs. Fulton and Cuyler both appealed to the chancellor from that decree. And those appeals were pending when the decree in this cause was made, and when the appeal from the same was entered; but the chancellor afterwards affirmed the decision of the vice chancellor.

      V. Matthews if S. Stevens, for the complainant.

      J, C. Spencer if M. T. Reynolds, for the defendant.
   The Chancellor.

As the respondent was a bona fide purchaser of the Uurbana property, without notice of any fraud on the part of Fulton in obtaining title to the same, there was no defect of title to that property which could authorize Cuyler to rescind the contract on that ground. Neither were the judgments against Tyler any lien upon the Urbana property in the hands of Cuyler.

It may not be necessary here to inquire whether the interest of a purchaser under a contract could be sold under a judgment, previous to the revised statutes, where such purchaser was in possession at the time of the recovery of the judgment. Clearly, however, it could not, unless the purchase money was all paid, so as to make the holder of the legal title a mere naked trustee for the judgment debtor, who was the real owner of the whole interest in the land. - (Bogert v. Perry, 17 John. Rep. 351.) The case oí Jackson v. Parker, (9 Cowerfs Rep. 73,) merely decided that the possession of land was bound by the lien of a judgment; and that a sale of such possession to one who had either actual or constructive notice of the lien did not prevent the judgment creditor from reaching and selling that possession. Or rather, the opinion of the chief justice went that length j but the judgment of the court was placed upon the ground that the transfer of the possession, by the judgment debtor to his son, was voluntary and fraudulent as against the judgment creditor. Even in cases in which the sheriff was authorized to sell the equitable interest of the judgment debtor in real estate, under the fourth section of the statute of uses, (1 R. L. of 1813, p. 74,) the judgment did not bind the equitable interest of the judgment debtor as against a bona fide purchaser from the time of docketing the judgment, but only from the time of issuing the execution. (Hunt v. Coles, Comyn's Rep. 226. Harris v. Pugh, 12 J. B. Moore's Rep. 517.) And though a judgment might in equity be considered a lien, as against a purchaser of such an interest with notice of the judgment, a bona fide purchaser who had obtained the legal title, without notice, would be protected against a sale under an execution issued on such judgment. Here, Fulton was the ostensible owner of the Urbana property, under a deed from Hammond the former owner, at the time Cuyler purchased it, and took a conveyance from him of the legal estate. And having given up the possession of the Penn Yan property to Fulton, under the contract, he had the right to claim protection as a bona fide purchaser of the property thus conveyed to him ; and to leave the creditors of Tyler to their remedy, if they had any, against the interest of Fulton in the property at Penn Yan, under the contract of February, 1831. By the revised statutes, the fourth section of the act concerning’ uses, which authorized a sale of an equitable estate in lands upon execution, was repealed ; it having-been rendered useless by the provisions of the revised statutes which turned all mere naked trusts into legal estates in the real owners or cestuis que trust. And the interest of the person holding a contract for the purchase of real estate can now only be reached, by his judgment creditor, by filing a creditor’s bill in this court after the return of an execution unsatisfied. (1 R. S. 744, § 4.)

There were some outstanding judgments against Fulton, at the time of his conveyance, which appear to have been legal liens upon the Urbana property in the hands of Cuyler. The existence of those liens, however, does not appear to have been fraudulently concealed from Cuyler, any more than the Herrick mortgage upon the Penn Yan property was fraudulently concealed from Fulton. On the contrary, Cuyler, at the time of making the contract and taking the deed from Fulton, appears to have contemplated the probable existence of outstanding incumbrances upon the Urbana property. And instead of investigating the subject, and having such incumbrances removed before he took his conveyance, he expressly provided in the contract itself for his protection in this respect; by retaining the title to the Penn Yan property until all such incumbrances should be removed. For by the express terms of the contract, which was executed simultaneously with the conveyance of the Urbana property, he agrees to convey the Penn Yan property to Fulton or his assigns upon the payment of the $1000 and interest, and upon Fulton’s making to him a perfectly clear, free and unincumbered title to the Urbana premises. Having thus protected himself against eventual loss from those incumbrances and carried the contract partially into effect, by taking a conveyance of the property, he had no right to rescind the contract on the ground of the existence of those incumbrances ; at least until he had given notice to Ellsworth, the assignee, of the existence thereof, and requested him to pay or discharge the same within a reasonable time. And as time was not made an essential part of the contract, either as to the removal of those incumbrances or as to the payment of the money due on the first of May, 1832, a court of equity ought not to permit him, as against Ellsworth the assignee, to rescind the contract immediately after the money became due, and to retain the $2500 in improvements which had been made upon the Penn Yan property by the purchaser thereof.

Although it appears by the assignment of the contract to Ellsworth, which was duly proved in this case, that he bought the property from Fulton for the price of $6000, a part of which was paid, according to the testimony of some of the witnesses, by assuming debts which had been contracted in making the improvements on the property, still he took that assignment subject to all the legal and equitable claims which existed against the property while Fulton held the contract. He therefore had no right to a conveyance, even if the $1000 and interest had actually been paid, until the title to the Urbana property was made perfectly clear by the removal of the incumbrances thereon arising out of the judgment against Fulton. And if Cuyler had given him notice of those judgments, and asked to have them removed within a reasonable time, and requested payment of the instalment of $250 and the interest which became due on the first of May, 1832, he would have been perfectly justifiable in demanding possession of the Penn Yan property, or in rescinding the sale and re-conveying the Urbana property, upon the terms proposed, in case the incumbrances were not removed and the instal-' xnent and interest paid without any unncessary delay.

I think, however, Ellsworth had an equitable right to insist that if the contract was not rescinded the purchase money should be applied to the payment of the mortgage money to Herrick, unless Fulton had precluded himself from asking to have that incumbrance discharged by some agreement subsequent to the making of the contract. The defendant in his answer states a conversation on that subject, and says that a mortgage was given on the Urbana property as an indemnity. But I have not been able to find any evidence to support this allegation in the answer ; and if such evidence exists I have overlooked it.

The real difficulty in the case, and the only one I presume out of which the litigation between the parties to this bill arose, was the suit commenced by Colt to obtain satisfaction of his judgments out of the Urbana property, or out of that at Penn Yan for which the Urbana property was received in payment. And the rights of the complainant in this case have unquestionably been most seriously affected by the result of that suit. For although that suit did not affect the interest of Cuyler in the Urbana property, which he was entitled to hold as a bona fide purchaser notwithstanding the alleged fraud, he could not during the pendency of that suit convey the Penn Yan property either to, Fulton or to his assignee without rendering himself liable to Colt, the complainant in that suit, in case he succeeded in establishing the fraud against Tyler and Fulton. And Ellsworth, having purchased of Fulton and taken the assignment of the contract pendente lite, must be bound by the result of that suit; so" that he is not now entitled to any decree against Cuyler inconsistent with the decree made in that suit. In relation to the interest of Fulton in the Penn Yan property, under the contract, Cuyler stood in the situation of an innocent stakeholder. It was therefore his duty to resist the present complainant’s claim to a specific performance of the contract, while the result of that suit was doubtful.

What then were the rights of these parties at the time the vice chancellor made his decree in this cause ? For the case should be disposed of in the same manner as if the decree in the suit of Colt had been affirmed previous to the making of the decree in this suit; the decision upon the appeal being now the law of the case, so far as this court is concerned. I see no reason for dismissing the bill without prejudice, and turning the complainant around to a new suit if he had any equitable right's whatever. And if he had not, the bill should have been dismissed absolutely. If the result of that suit had been otherwise upon the question of fraud in the assignment of Tyler’s interest in the Urbana property, I think Ellsworth the complainant would have been entitled to a decree for a specific performance ot the contract, upon payment of the $1000 and interest, and clearing off the incumbrances upon the Urbana property so as to make Cuyler’s title to that property clear and perfect, and upon payment of his costs in this suit and in the ejectment suit; his costs in the suit of Colt having been already provided for in the decree in that cause. But the result of the litigation in the suit of Colt and the decree which has been made in that case, leaves the question as to the terms upon which a specific performance shall be decreed to be disposed of between the purchaser under that decree and Cuyler. In other words, all the interest which Fulton or his assignee had in that contract, at the time of the decree in that case, is to be sold under the direction of the master, and Colt’s debt and costs are to be paid out of the proceeds of that sale. As the sale is to be subject to all the rights of Cuyler, who is to execute to the purchaser such conveyances and covenants as he was to have executed to Fulton, on such purchaser’s complying with the conditions of the contract within a reasonable time, Cuyler does not appear to have any interest in the monies to he raised by that sale. And if there should be any surplus beyond the amount of Colt’s debt and costs, it of course must belong to the complainant in this suit, as the assignee of Fulton’s interest in the contract. I think the vice chancellor, therefore, instead of dismissing the complainant’s bill, should have declared and decreed that he was entitled to such surplus monies, if any there should be. For Cuyler will, of course, under the decree in the Colt suit, be entitled to retain the Urbana property and nothing is left to be disposed of in this suit but the right, to such surplus and the costs. The decree must he reversed and modified accordingly. And the defendant is entitled to his costs against the complainant, except the costs upon the appeal; and neither party is to have them as against the other upon this appeal.


text:
    Stuyvesant vs. Davis.
    Where a landlord elects to proceed at law against his tenant to enforce a forfeiture of the lease for the non-performance of its conditions, he cannot, during the pendency of the suit at law against the tenant, have relief in equity against him as upon a subsisting tenancy.
    The receipt of rent which accrued subsequent to the forfeiture of the lease is a waiver of the forfeiture, and will constitute a good defence to an ejectment suit brought against the lessee to enforce such forfeiture.
    And it seems that if the landlord distrains for rent which accrued previous to the forfeiture, it is such an admission of a subsisting tenancy at the time of such distress as to prevent a recovery in an ejectment suit upon a demise laid previous to that time.
    The landlord, after he has re-entered for a forfeiture of the lease, may recover the rent which accrued previous to such forfeiture, in an action of debt, or an action upon the covenants in the lease. But for rent which became due subsequent to that time, he cannot recover as landlord; and his only remedy is to proceed for the mesne profits, against the lessee or other person who has held the possession of the premises adversely to his claim.
    Although by the condition of a lease it is provided that if any of the covenants on the part of the tenant are broken the unexpired term shall cease and determine, if the lease also contains the clause that in case of the non-performanco of such covenants the landlord may re-enter, the lease is voidable only, at the election of the landlord, but not void.
    March 1.
    This was an appeal from a decision of the vice chancellor of the first circuit refusing to dissolve an injunction, upon the matter of the bill only. The complainant in 1836 leased to the defendant, by separate leases, five lots in the city of New-York, for the term of twenty years, at a rent of $200 each for three of the lots, and of $100 each for the other two lots, payable semi-annually on the first of May and November. And the lessee covenanted to pay the rents reserved in the leases respectively, and all taxes and assessments, ordinary and extraordinary. The performance of these covenants was also made a condition of the estate granted to the tenant, by each of the leases; and the lessor was authorized to re-enter and become possessed of his former estate upon the failure of the lessee to perform the covenants. The bill alleged that the defendant took possession of the several lots, under the leases, and had underlet the same, or parts thereof, to various tenants and for different terms, and that the greater part thereof were then underlet to tenants who'were in the occupation of the same at rents which, in the aggregate, exceeded $1200 per annum ; that there was renf in arrear and due to the complainant upon the original leases, to the amount of about $1725 j and that, as the complainant was informed and believed, there was ho sufficient distress upon the premises to pay off and satisfy that rent. The complainant also stated in bis bill that he had caused an ejectment suit to be brought against the defendant, and his tenants, to recover possession of the premises, for the nonpayment of the rent reserved in the leases, and also for the non-payment, by the defendant in this suit, of certain taxes and assessments which had been imposed upon the lots, and for the non-payment of which the premises had been sold by the corporation ; that the defendant was insolvent and intended to collect the rents due and to grow due from his sub-tenants, and to defraud the complainant of his debt; that the agent of the defendant had collected and had in his hands a large amount of rents received from such sub-tenants ■ and that the complainant was apprehensive that before he could recover possession of the premises, by his ejectment suit, the defendant would collect his rents from his sub-tenants, or would distrain for the same or otherwise harrass them, so that they would leave the premises tenantless. He therefore prayed that the defendant or his sub-tenants or agent might be decreed to pay the complainant the rents due or to grow due from such sub-tenants, or then collected and in the hands of the agent ; that the defendant might be restrained from collecting, or receiving, and his agent and sub-tenants from paying to him any rents due or to become due; and that the defendant might be restrained from injuring or molesting buildings, and from hiring out or exercising any control or ownership over the premises, or assigning, transferring or disposing of his title to the same.

      J. Rhoades, for the appellant.

      8. M. Woodruff, for the respondent.
   The Chancellor.

If there was any equity in the complainant’s bill in other respects, the allegation that there is no sufficient distress on the demised premises to pay the arrears of rent is not sworn to in such a manner as to authorize the issuing of an injunction. This was a fact susceptible of positive proof, by resorting to the ordinary mode of testing it by an actual distress. Again, it was not necessary that there should be sufficient to pay the whole rent due for the five lots. For as the lots were leased separately, if there was a sufficient distress on either to pay the arrears of rent due on that particular lot, the complainant had no right to re-enter, as to that lot, for nonpayment of the rent due on the lease thereof. And as he does not state in his bill on which lots the rent remains unpaid, or on which .of them there is no sufficient distress, he clearly was not entitled to an injunction in relation to either of the lots; even if the non-payment of rent and the want of a sufficient distress "was a sufficient ground for granting an injunction the effect of which is to turn the lessee out of possession of his property.

Again ; if the complainant elects to proceed at law to enforce the forfeiture of the lease, for the non-payment of the taxes and assessments, he cannot in the meantime treat the lessee as his tenant and righfully in possession of the premises, so as to obtain an equitable claim to the accruing rents by virtue of his lease. For by bringing an ejectment suit for the forfeiture, he has chosen to treat the lessee and his sub-tenants as trespassers, from that time. The claim to the accruing rents, therefore, is wholly inconsistent with his proceeding at law to enforce the forfeiture. Indeed, the receipt of any rent which had accrued after the breach of covenant upon which his ejectment suit is founded, would of itself be a waiver of the forfeiture and a good defence to that suit. (Goodright v. Davids, Cowp. Rep. 803. Fox v. Swan, Styles’ Rep. 483.) And it seems, by a recent decision of Mr. Justice Patterson, that the act of the landlord, in distraining for the rent which accrued previous to the forfeiture, is such an admission of an existing tenancy at the time of such distress, as to prevent a recovery in an ejectment suit upon a demise laid in the declaration previous to that time. (Doe ex dem. David v. Williams, 7 Car. & Payne’s Rep. 322. See also Penant’s case, 3 Coke’s Rep. 64, b. note B. Thomas & Frazer’s ed.) The landlord may indeed, after his re-entry, recover in an action of debt, or in an action upon the covenants in the lease, for the rent which accrued and became due before the demise laid in the declaration in the ejectment suit. He cannot, however, recover as landlord for any rent due after that time, but must he left to his remedy for mesne profits against the lessee or other person who has held the possession of the premises adversely to his claim. It does not distinctly appear in this case whether the lease was made absolutely void for the non-payment of taxes and assessments, or whether it was merely voidable. Although by the terms of a lease it is provided that if any of the covenants on the part of the tenant are broken the unexpired term shall cease and determine, if the lease also contains the clause that, in case of the non-performance of such covenants, the landlord may re-enter, as I infer from the statement in the bill was the case here, the lease is voidable only at the election of the landlord, but not void. And, in that case, this landlord may still waive the forfeiture and proceed for the recovery of the rent, and for the non-payment of the taxes and assessments. (Amsby v. Woodward, 6 Barn, & Cress. 519. Dakin v. Cope, 2 Russ. Rep. 174.) But while the landlord is proceeding in his ejectment suit to enforce the forfeiture, this court will not entertain a bill to give to him a remedy for the recovery of his rent, or his damages for the non-payment of the assessments; which remedy is wholly inconsistent with that proceeding.

The injunction in this case ought never to have been granted. The order of the vice chancellor must therefore be reversed, and the injunction must be dissolved, with costs to be taxed,

Ordered accordingly.


text:
    Curtis and others vs. Tyler & Allen.
    Where the owner of a mortgage assigned the same and covenanted with the assignee that the amount of the mortgage was due and collectable, and subsequently took the bond of a third person as a further security for the payment of the amount due upon such mortgage; Held, that the assignee of the mortgage was, in equity, entitled to the benefit of this collateral bond for the security of the mortgage debt; and that, in a suit for the foreclosure of the mortgage, the obligor in such bond was properly made a defendant, to enable the complainants to obtain a decree over against him for the deficiency, if the proceeds of the mortgaged premises should not be sufficient to pay the amount due and the costs of the foreclosure.
    Where a person standing in the situation of a surety for the payment of a debt receives a collateral security for such payment, for his indemnity, the principal creditor is, in equity, entitled to the benefit of such collateral security ; although he did not originally roly upon the credit of such collateral security or know of its existence.
    March 1.
    This was a demurrer by the defendant R. L. Allen to the complainants’ bill. The object of the suit was to foreclose and obtain satisfaction of two bonds and mortgages, upon the same premises, executed by the defendant Tyler on the 5th of December, 1838. And Allen, who had guarantied the payment of one of the bonds and mortgages, was made a defendant, for the purpose of obtaining a decree over against him for the deficiency, if any there should be, upon a sale of the mortgaged premises, in case the deficiency could not be collected from Tyler, the mortgagor. The first bond and mortgage was given to Joseph D. Beers, as president of the North American Trust and Banking Company, to secure the payment of $25,000, and interest, in one year ; and the last was given to J. B. Murray, to secure the payment of $3,400, payable at the same time. On the first of January, 1839, Murray assigned his bond and mortgage to Beers, as such president, and warranted that it was due and was collectable. And on the 1st of April thereafter the defendant Allen, further to secure the payment of that bond and mortgage, executed his bond to Murray conditioned to pay the $3,400, according to the condition of Tyler’s bond and mortgage, or to cause the same to be paid by Tyler. On the 1st of February 1840, Beers, as such president, sold and assigned both bonds and mortgages, and all monies due and to become due thereon, to the complainants.

      L. H. Sandford, for complainants.
    There was no necessity for describing how or for whom the complainants are trustees. If it is pretended that there are any cestuis que trust who ought to be made parties, that should be set up by way of plea or answer. The trust will be presumed to be a legal one if necessary. Besides, naming the complainants as trustees is a mere description of their persons, and in no sense limits the absolute interest they possess under the various assignments to them. Again ; the consideration, of the assignment to the complainants is alleged to have been paid by them, and the assignment says nothing about their being trustees.
    B-. L. Allen is a proper party to the bill, he having given a collateral bond for the payment of one of the mortgage debts, and being contingently liable. (2 R. S. p. 118, § 158, 160. 2. Hoff. Ch. Prac. 141, 2. Bigelow v. Bush, 6 Paige, 343.) The assignment of that mortgage debt carried with it his bond as a necessary incident, and being in the complainants’ possession, they have a complete and valid title to it. (3 Powell on Mort. 908, note 1, and cases there cited. Green v. Hart, 1 John. R. 580. Johnson v. Hart, 3 John. Ca. 322.)
    The bill is not multifarious, there being a common subject matter, the mortgaged premises, upon which the complainants have an absolute lien for the mortgage debts, and the whole of which they claim an equitable right to have appropriated to the payment of those debts in the order of seniority. They may properly join these two claims, therefore, in one bill, and as a necessary consequence may join all persons interested in either mortgage or in the fund which they claim thus to appropriate. It is a well settled rule that a bill is not multifarious which sets up a general right, though the defendants have separate and distinct interests growing out of it. (Austin v. Figueira & al. 7 Paige, 56. Vancleef v. Sickles, 5 Idem, 505. Boyd v. Hoyt, Idem, 65. 1 Mont. Ch, Pl. 74. 2 ib. 94, and note. 1 Atk. 282. Mitford Pl. 147, 148. Stokes v. Clendon, 3 Swan. 150, note.)

      C. Stevens, for the defendant R. L. Allen.
    The complainants having filed their bill in the character of trustees, should disclose the nature of the trust, and for whose benefit the trust was created. The bill does not allege or pretend any reason for making the defendant, Richard L. Allen, a party. If the fact of Richard L. Allen’s having executed a collateral bond to Murray is any reason for making Murray a party defendant, still the bill is multifarious as to Allen.
   The Chancellor.

There is no foundation for the objection that the complainants have not disclosed the nature of the trust upon which they hold the bonds and mortgages assigned to them by Beers, or the names of the cestuis que trust. It is not alleged in the bill that the bonds and mortgages were assigned to the complainants upon any trust whatever; and for aught that appears, the addition of the word trustees after their names, is a mere matter of description. If the mortgages have been assigned upon trusts which are illegal, or upon trusts which require that the cestuis que trust should be brought before the court as parties, that is a distinct matter of defence which must be set up by plea or answer, and cannot be raised upon a demurrer to a bill which shows no illegality or want of necessary parties upon its face.

The objection for the multifariousness is equally untenable. Both mortgages are upon the same premises, and Murray, the assignor, had guarantied the payment of the second mortgage, in his assignment to Beers, and the defendant had guarantied the same by his bond to Murray. And if the assignees of Beers are entitled to the benefit of those guaranties, then both Murray and Allen were properly made defendants, in connection with the mortgagor and subsequent claimants under him ; pursuant to the authority-given to the complainant by the article of the revised statutes relative to the powers and proceedings of this court upon bills for the foreclosure or satisfaction of mortgages. (2 R. S. 191.) It, therefore, only remains to consider whether the present assignees of the mortgage given to Murray are entitled to the benefit of the bond given by the defendant Allen to Murray guaranteeing the payment of that mortgage debt.

The bond of the defendant Allen was given to Murray, and of course was not assignable so as to enable the present holders of the mortgage to sue thereon in their own names in a court of law. And as it was in fact given, according to the statement in the complainants’ bill, subsequent to the assignment of the bond and mortgage to which it was intended to be a collateral security, it is only upon a principle of equity that the present holders of Tyler’s bond and mortgage to Murray are entitled to the benefit of this collateral bond. It is well settled, however, that where a surety, i or a person standing in the situation of a surety for the payment of a debt, receives a security for his indemnity and to discharge such indebtedness, the principal creditor is in equity entitled to the full benefit of that security. And it makes no difference that such principal creditor did not act upon the credit of such security in the first instance, or even know of its existence. Thus in Maure v. Harrison, (1 Eq. Ca. Abr. 93,) it was held that in equity a bond creditor was entitled to the benefit of all counter bonds or collateral securities given by the principal debtor to his surety. And that the holder of a bond was, therefore, entitled to the benefit of a bond and mortgage given by the principal debtor to his surety in the bond, for the indemnity of such surety. So in the case of Ex parte Perfect, (Mont. Bank. Rep. 25,) the vice chancellor of England decided that the endorser of a bill of exchange had an equitable claim to property deposited with the drawee as security against the payment of the bills accepted by him. The same principle was acted on by the supreme court of this state in the case of the Bank of Auburn v. Throop, (18 John. Rep. 505,) upon an application to the equitable powers of that court. (See also Parsons v. Buddock, 2 Vern. Rep. 608; Waring and others, Ex parte, 19 Ves. 345; Ex parte Parr, Buck’s Bank Ca. 191; Ex parte Prescott and others, 3 Deac. & Chitty’s Rep. 218.)

In the case under consideration, Murray had assigned the bond and mortgage given to him, and had guarantied the payment thereof to the assignee. He, therefore, stood in the situation of a surety for the mortgagor, when the latter procured the bond of Allen as a collateral security, or as a guaranty of the payment of his original bond and mortgage. The present holders are, therefore, in equity, entitled to the benefit of this collateral bond, in the same manner and to the same extent as if it had been given to Murray before he assigned his bond and mortgage, and had been expressly assigned by him to Beers, and by Beers to the complainants. The provision of the revised statutes, before referred to, is sufficiently broad to reach this case ; so as to enable the court to make a decree over against the defendant Allen for the payment of the deficiency upon the second bond and mortgage, in case there should be a deficiency which cannot be collected from the mortgagor, who is primarily liable therefor. And if it cannot be collected from either of those defendants, the decree may then authorize the complainants to take out execution for the deficiency against Murray, who is also liable for the payment of the mortgage debt in consequence of the guaranty contained in his assignment to Beers.

The demurrer is therefore overruled with costs. And the defendant Allen must pay the costs and put in his answer within twenty days, or the bill may be taken as confessed against him.


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    Mackay vs. Blackett & Stubbs.
    Where a solicitor of the court of chancery was sued in an action for false imprisonment for causing a party to a suit in chancery to be arrested upon process which was afterwards set aside for irregularity; Held, that if he desired the protection of the court of chancery against the suit at law, he should have applied to that court before the trial of that suit.
    Wherever the jurisdiction of the court of chancery, the title of its officers, or the validity of its process or of its orders, is disputed or attempted to be drawn in question, by a suit in another court against those who were acting under the process or order of the court of chancery, that court is bound to interfere for their protection.
    But where the process of the court of chancery has been irregularly and illegally issued, and has been set aside by the court itself for that reason, or where an officer of the court, under color or pretence of executing its order, has transcended his authority and interfered with the personal rights of others, the court may allow the injured party to seek his redress by an action at law.
    Where process of the court of chancery is set aside for irregularity, the court, in its discretion, upon a summary application may restrain the parties against whom such process issued from proceeding at law for any act done under such irregular process; although it was not made a condition of the order setting aside the process that no such suit or proceeding should be instituted. But the party who desires the court of chancery to take the matter into its own hands, and to give to the injured party such redress as he may be entitled to in that court, must seek the aid of the court promptly, and before he has tried the chances of a litigation of the matter in another court.
    March 1.
    This was an ex parte application, on the part of the complainant, in the nature of an appeal from the decision of the vice chancellor of the first circuit refusing to grant an injunction upon the complainant’s bill. The complainant was a solicitor of this court, and as such had been retained to defend a suit commenced before the vice chancellor, by Blackett and Stubbs and others, against Lainebeer and* others. And the bill having been dismissed with costs for want of prosecution, Mackay as solicitor for two of the defendants in that suit procured a capias ad satisfaciendum to be issued, upon which Blackett and Stubbs were imprisoned; which execution was afterwards set aside by the vice chancellor as having been improperly issued, and in violation of the provisions of the act to abolish imprisonment for debt. Separate suits were thereupon brought, by Blackett and Stubbs respectively, against Mackay and the sheriff, in the court of common pleas of the city of New-York, for the false imprisonment; in both of which suits verdicts were found against Mackay sufficient to carry full costs. The complainant thereupon filed his bill in this cause and prayed for an injunction to restrain the defendants from proceeding any further in their actions at law.

      H. S. Mackay, in person.
   The Chancellor.

I think the vice chancellor was right in supposing that the complainant came too late with his application for an injunction ; even if he was right in bringing his case before the court in "the form of an original bill instead of a summary application to the vice chancellor, before whom the suit was pending in which the irregular process had been issued. Where the jurisdiction of this court, the regularity of its process, or the validity of its orders is not in question, it is not a matter of course to restrain all proceedings against its officers in other courts for alleged misconduct in relation to proceedings here. In Frowd v. Lawrence, (1 Jack. & Walk. Rep. 636,) Lord Eldon does indeed appear to have laid down the broad proposition that this court was bound in all cases to interfere and restrain any proceedings against its officers, in other courts, for alleged misconduct in executing its process or orders ; and to compel the injured party to seek redress by an application to the justice of this court alone. But in the more recent case of Aston v. Heron, (2 Myl. & Keen’s Rep. 390,) Lord Brougham has more correctly stated the principles upon which the court proceeds in such cases. Wherever the jurisdiction of this court, the title of its officers, or the validity of its process or of its orders is disputed, or attempted to be drawn in question, by a suit instituted in another court against those who are acting under the orders or the process of the court of chancery, it is bound to interfere for their protection. In such cases the court has no choice ; it cannot allow any proceedings of the kind to go on without abandoning its own jurisdiction. It must restrain of course ; otherwise it permits its own orders to be rescinded and its jurisdiction to be questioned—its orders to be rescinded indirectly and not by the superior court of appeal; its jurisdiction to be questioned by courts of inferior or co-ordinate authority. But where the process of the court has been irregularly and illegally issued, and has been set aside by the court itself for such irregularity, or where an officer of this court under color or pretence of executing its orders has transcended his authority and interfered with the personal rights of others—where the process or the orders of this court have furnished a mere pretext for doing wrong— there are no considerations either of principle or of practical convenience which require the court, in every case, to draw to itself the consideration of the matter, to prevent all other tribunals from punishing the wrong-doer, and to exclude the injured party from access to all redress save that which its own jurisdiction can afford. (See Parker v. Browning, 8 Paige’s Rep. 388.)

Where process is set aside for irregularity, I believe all courts exercise the power of making it a condition of the order that no suit shall be brought for acts done under such voidable process, if the court, in the exercise of its discretion, thinks proper to insert such a condition in its order. And this court, upon a summary application, may restrain the prosecution of any such suit, although it has not been made a condition of the order that no suit shall be brought. But as, upon such an application, this court may afford the injured person redress here, the party who wishes this court to take the matter into its own hands and restrain all proceedings elsewhere, should seek the aid of this court promptly and before he has tried the chances of a litigation of the matter in another tribunal. The complainant, in the present case, therefore, instead of waiting the result of a trial by jury in the court of common pleas, should have applied at once to the vice chancellor, before whom the original suit in which the irregular process had been issued was pending, to stay the proceedings at law ; if he thought it was a proper case for the interference of this court. Having taken the chance of a successful defence in another tribunal, or of a verdict for nominal damages merely in that court, and the result having proved disastrous to his interests so far as the amount of damages given by the jury is concerned, it was too late for him to ask the vice chancellor to take the matter into his own hands, and thereby to give the complainant the chance of having a different measure of justice meeted out to his adversaries in this court.

Even if the application had been made in time, and was in other respects a proper case for the interference of this court, I think the regular mode of proceeding was by petition to the vice chancellor, instead of a formal injunction bill. In other words, applications of this kind are to be disposed of by summary proceedings before the chancellor or vice chancellor having jurisdiction of the original cause in which the matter arose, and not by a regular suit in this court.

The application for an injunction must, for these reasons, be denied.


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    In the matter of Livingston, a lunatic.
    The court of chancery, in the exercise of its discretion, may authorize the committee of a lunatic to apply the personal property for the improvement of unproductive real estate, by the erection of buildings thereon, &e.
    The committee of a lunatic cannot be allowed for his services, as such committee, any greater or different compensation than that which is fixed by the revised statutes as the allowance, by way of commissions, to executors, administrators and guardians.
    Where the interest of the estate of a lunatic requires the payment of an agent or clerk, the court, upon the application of the committee, will allow him to employ such agent or clerk, and to pay him a reasonable compensation for his services out of the income of the estate. But the committee himself cannot receive a compensation for services as such clerk beyond his allowance for commissions as the committee.

      March I.
    This was an application by N. G. Kortright the surviving committee of the person and estate of his mother, Mrs. C. Livingston, a lunatic, for leave to invest a part of her personal estate in buildings or other improvements on her unproductive real estate ; and for an allowance by way of salary for the care and management of the estate.

      J. Blujit. for the petitioner.
   The Chancellor.

There is no difficulty in granting so much of the prayer of the petition as asks for permission to apply the surplus income of the lunatic’s property to the improvement of the unproductive real estate. The committee may also be authorized to apply a reasonable portion of the capital of the personal estate, to the extent of twenty or twenty-five thousand dollars, if he shall deem it expedient to do so, in building upon such of the vacant lots as are so situated as to produce an immediate and fair income from such improvements.

But I do not consider this court as authorized to allow to the committee for his services any greater or different compensation than that which is fixed by the revised statutes as the allowance to be made to executors and administrators and guardians. Previous to the act of the 15th of April, 1817, authorizing the chancellor to settle a rate of allowance for the services of executors, administrators and guardians, (Laws of 1817, p. 292,) I am not aware of any case in which the court of chancery in this state or in England, had allowed a direct compensation to the committee of a lunatic for his personal services. In the anonymous case which came before Lord Eldon in 1804, (10 Ves. jun. 103,) he refused to make an order allowing the committee any thing for his care and trouble ; saying he did not recollect an instance where such an allowance had been made. The case that comes the nearest to a direct allowance, previous to 1817, is that of Annesley in 1749, (Amb. Rep. 78,) where Lord Hardwicke, under very peculiar circumstances, being unwilling to make a precedent of a direct allowance to the committee for his services, directed a new petition to be presented asking for an increased allowanee for the support of the lunatic. In 1821, however, Lord Eldon made a precedent, in the case of Errington, (Jac. Rep. 406,) by allowing to the committee of the estate a per centage for managing the estate and collecting the rents and profits thereof; which allowance, as appears by a subsequent statement by Mr. Collin son who was counsel, was fixed at five per cent upon the amount of rents collected. (See the matter of Errington, 2 Russ. Rep. 567.) As a general rule, however, the court of chancery in England still adheres to the ancient practice of not allowing any thing to the committee for his care and trouble in the management of the lunatic’s estate, beyond his actual expenses and disbursements. (Stock’s Law of Non Comp. Ment. 125. Shelf. Law of Lun. 162.)

But in the case of Roberts, (3 John. Ch. Rep. 43,) Chancellor Kent held that the case of a committee of a lunatic was within the equity of the statute of April, 1817, authorizing a fixed allowance for the services of executors, administrators and guardians. And in the case of Mc Worter v. Benson, (Hopk. Rep. 28,) his successor in office decided that the court was only authorized to make allowances in such cases according to a settled or fixed rule or rate, and could not vary the compensation in reference to the circumstances of each particular case. This was also considered as the settled law of this court in the case of VanderheydenY. Vanderheyden, (2 Paige’s Rep. 287.) The principles of these decisions must, therefore, be considered as applicable to the compensation to be allowed to committees of the estates of idiots, lunatics and habitual drunkards, as well as to guardians and executors and administrators ; although such committees are not named in the act of 1817, nor in the revised statutes, as entitled to such fixed compensation for their services. And no other allowance will be made to the committee for his personal services, exclusive of his actual expenditures and disbursements.

In this case the petitioner is entitled to charge commissions upon the periodical statements of his accounts, according to the decision of this court in the case of Kellogg, an infant, (7 Paige’s Rep. 265.) And if the interest of the estate requires the employment of an agent or clerk, the committee may present a petition, for leave to employ one and to pay him out of the income of the lunatic’s property; due notice of such application being given to the other children and presumptive heirs of Mrs. Livingston. The situation of this estate, amounting in the aggregate to about four hundred thousand dollars, and producing an annual income of from eighteen to twenty thousand, probably requires the employment of such clerk or agent. But the principles upon which this court acts do not permit the employment of the committee himself as such clerk or agent, if he is to receive an extra compensation for his services.


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    Woodruff vs. Bunce.
    Where a contract for the sale of land has been executed by the giving of a conveyance, the court of chancery will not rescind the contract upon the ground of a mere defect of title, where there has been no fraud on the part of the vendor, but will leave the purchaser to his remedy upon the covenants in his deed.
    But where the covenants in a deed have been actually broken, and the gran»tor is insolvent, a court of equity may restrain him from proceeding to col-» lect the whole amount due for the purchase money, from the grantee, and may offset the damages occasioned by the breach of the covenants of seisin or of warranty against such unpaid purchase money*
    March 1.
    This case came before the court upon a general demurrer to the complainant’s bill for want of equity. The object of the suit was to restrain the defendant from proceeding to collect a bond and mortgage given for a part of the purchase money upon the sale of three lots of land, and to recover back the residue of the purchase money which had already been paid. The bill alleged that the defendant contracted to give the complainant a good and sufficient warranty deed of the lots in question, free from incumbrance, and stated that he was the owner thereof; that he afterwards conveyed the same with warranty, and that the complainant took the deed and gave back the bond and mortgage supposing that the deed conveyed a good title, but that he had since discovered the defendant was only one of several executors and was not authorized alone to convey the premises ; and that the defendant had brought a suit at law upon the bond, and recovered judgment therein, and was proceeding in chancery to foreclose the mortgage.

      M. T. Reynolds, for the complainant.

      James Edwards, for the defendant.
   The Chancellor.

There is nothing that I can discover in this bill to warrant the interference of this court, although if the allegations therein are true the complainant has not obtained the legal title to the three lots under the defendant’s deed of warranty. It is not pretended in this case that the defendant was guilty of any intentional misrepresentation or fraud in relation to the sale of these lots, or that he is not in a situation to procure a perfect title to the premises upon the payment of the residue of the purchase money, by getting all the other executors to join in a conveyance to the complainant.

As a general rule, where a contract to sell has been executed by an actual conveyance, a court of chancery will not rescind the contract on account of the mere defect of title, except in a case of fraud, but will leave the purchaser to his remedy upon the covenants in his deed. If the covenants have been actually broken and the grantor is insolvent, a court of equity may restrain him from proceeding to collect the whole amount due for the purchase money, and may offset the damages occasioned by the breach of the covenants of seisin or of warranty against such unpaid purchase money. (See Simpson v. Hawkins, 1 Dana’s Rep. 305 ; 2 Ch. Ca. 19.) Here there is no allegation that the vendor is insolvent, or that there has been any eviction of the purchaser under a paramount title; nor is it alleged that the complainant is even threatened with a suit for the recovery of these lots. In the case of Bum-pus v. Plainer, (1 John. Ch. Rep. 218,) Chancellor Kent considered an eviction at law an indispensable part of the complainant’s claim to relief in this court, on the mere ground of the failure of title, after the contract of purchase had been executed and the possession of the premises had passed to the grantee. And in the subsequent case of Abbott v. Allen, (2 Idem,, 519,) he re-examined the question, and decided that a purchaser of land, who has paid part of the purchase money and given a bond and mortgage for the residue, and is in the undisturbed possession, cannot be relieved against the payment of the bond, or a foreclosure of the mortgage, on the mere ground of a defect of title, there being no allegation of fraud in the sale nor any eviction; but that he must seek his remedy at law upon the covenants in his deed. In a subsequent case, however, where the purchaser was actually sued for the recovery of the land, by a person claiming a paramount title, the same learned chancellor granted an injunction, ex parte, to stay the vendor from proceeding to enforce the collection of his bond and mortgage until the result of the ejectment suit for the recovery of the land was ascertained. (Johnson v. Gere, Idem, 546.)

But even this last case is not an authority in favor of sustaining the present bill. The demurrer must, therefore, be allowed, and the complainant’s bill dismissed with costs.

Decree accordingly.


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    Halsey and others, executors, &c. vs. Reed and others
    Where R. who had given his bond and mortgage upon a tract of land to secure the payment of $6000 and interest, afterwards sold a part of the mortgaged premises to H., and as a part of the consideration of such sale, H. assumed the payment of the whole of the bond and mortgage, and received a deed from R. which stated that the premises thereby conveyed were subject to the mortgage, and that the payment of the mortgage was assumed by H. the grantee, and that the amount of such mortgage con. stituted a part of the consideration of the deed ; Held, that R. could not recover the amount of the bond and mortgage from the executors of H. before he had paid the same to the mortgagee; and' that a recovery of mere nominal damages in a suit brought by R. against such executors, before he had paid any thing upon the bond and mortgage, was no bar to-a subsequent suit for the amount which R. had been subsequently compelled to pay to the mortgagee; Held further, that the executors of H. would be liable in equity to the mortgagee for the payment of the deficiency, in case the proceeds of the sale of the part of the land which was conveyed to their testator should be insufficient to pay the mortgage debt and costs; but that the portion of the mortgaged premises conveyed to H. must first be resorted to for the payment of the mortgage, and that the personal estate of the decedent was, in equity, only chargeable with the deficiency.
    Under the provisions of the revised statutes, as between the heirs or devisees and the personal representatives of a deceased mortgagor, the mortgaged premises are primarily chargeable with the payment of the mortgage, unless the decedent has, by his will, made a different provision for the payment of the mortgage debt.
    Where the owner of mortgaged premises sells a part of the land to a purcha. ser who assumes the payment of the whole mortgage, and the owner of the residue of the land is obliged to pay the mortgage, the latter is entitled" - to an assignment of such mortgage, to enable him "to obtain satisfaction out of the land of the person who has assumed the payment.
    If the purchaser of mortgaged premises agrees with the mortgagor to pay off and discharge the mortgage thereon, for the protection and indemnity of the mortgagor, the mortgagee is in equity entitled to the benefit of such agreement. And such agreement is within the equity of the provision of the revised statutes which authorizes the court of chancery, in a foreclo. sure suit, to make a decree over for the deficiency against a third person' who is liable for the payment of the mortgage debt.
    Where a surrogate decrees a distribution of the personal estate of the deceased debtor among his creditors, if any of such creditors has a security for his debt upon another fund which is primarily liable for the payment of the debt, the surrogate should compel such creditor to exhaust his remedy ■against such fund, and only to come in as against the personal estate for the deficiency.
    And where it is necessary for the surrogate to make a distribution of the per. sonal estate of the decedent before such deficiency can be ascertained, he should direct a portion of the personal estate to be retained to meet the contingent claim for such deficiency.
    March 15.
    This was an appeal by the executor and executrix of J. M. Halsey deceased, from the sentence and decree of the surrogate of the county of Kings, decreeing the payment of the amount of a bond and mortgage out of the estate of the decedent, in the hands of the appellants as his personal representatives. The facts of the case, as they appeared from the surrogate’s return, were substantially these : In May, 1835, the respondent Reed gave to Johnson & WyckoE a bond and mortgage on a tract of land in the city of Brooklyn, to secure the payment of $6000, in one year, with interest at the rate of six per cent. In May, 1836, Reed paid the interest and gave a stipulation, endorsed upon the bond, that he would thereafter pay the interest upon the bond and mortgage annually at the rate of seven per cent per annum. A few days thereafter WyckoE assigned the bond and mortgage to Johnson ; and Johnson assigned the same to the Farmers’ Loan and Trust Company, in July 1836, and guarantied the collection thereof with interest at the rate of seven per cent from the first of May preceding the date of that assignment. In October, 1836, Reed sold and conveyed to J. M. Halsey certain portions of the mortgaged premises, for the consideration of $10,876, and as a part of such consideration Halsey assumed the payment of the bond and mortgage • which payment was provided for by a clause in the conveyance from Reed to Halsey, stating that the premises conveyed were subject to the mortgage, and concluding as follows : “ which said mortgage, and the interest which the said Philip Reed has agreed to pay thereon, from the first day of May last, is assumed by the said party of the second part, and the amount thereof constitutes part of the consideration of this conveyance and has been deducted therefrom.” The interest upon the bond and mortgage for the year ending on the first of May, 1837, was endorsed as paid, but when or by whom did not appear in the surrogate’s return. But the three half yearly payments of interest which became due in November, 1837, and in May and in November, 1838, were paid by Halsey or his executors;. the first payment was by Halsey himself, and- the two last by his executors. Halsey died previous to the 18th of January, 1838, leaving a widow, and seven children, some of whom were infants, his heirs at law. By his will he appointed his widow and one of his sons, the appellants in this case, his executor and executrix ; and they proved the will and took out letters testamentary thereon on the day last mentioned.
    In July, 1838, the Farmers’ Loan and Trust Company filed a bill for the foreclosure of the mortgage, alleging that the whole principal of the debt, together with the interest thereon from the 1st of November, 1837, was then due and unpaid ; to which bill Reed and Johnson and the executor and executrix and the heirs of Halsey, and some other persons having an interest in the mortgaged premises, were made parties. And about the same time Reed brought an action of assumpsit against the executor and executrix of Halsey, in the supreme court, upon the agreement to assume and pay the bond and mortgage; in which suit Reed afterwards recovered nominal damages merely; no evidence being given that he had been compelled to pay any thing on the bond and mortgage after the conveyance of a portion of the mortgaged premises to Halsey in 1836. In October,,1838, the appellants put in their answer to the foreclosure suit, admitting the conveyance of part of the mortgaged premises to the testator, and that he, as a part of the consideration of such conveyance, assumed the payment of the amount due to the complainants upon the mortgage. They also stated the commencement of the suit against them in the supreme court, by Reed, which was then pending, and claimed that there should be a de- ■ cree for the sale of his portion of the mortgaged premises in the first place, which was more than sufficient to satisfy the amount due on the bond and mortgage. Reed also put in an answer to the bill of foreclosure, whereby he incurred an expense of $40,86 ; and the foreclosure suit was still pending at the time of the hearing before the surrogate. It was admitted that Reed had paid to the complainants $210 on the bond and mortgage, for interest 5 but at what time that payment was made, whether before or after the judgment for nominal damages in the supreme court, was not stated. The appellants also admitted that Reed had paid towards the costs in the foreclosure suit, $100,75,
    In December 1839, the respondent Reed presented a petition to the surrogate stating, among other things, that he was a creditor of the decedent, and praying that the executor and executrix might account, &c. The appellants appeared before the surrogate and asked a discontinuance of the. proceedings, and insisted that the petitioner was not a creditor, and that the judgment in the supreme court was a bar to any further claim on his part, on account of the alleged agreement of the decedent to assume and pay the bond and mortgage. They admitted, however, that they had sufficient pérsonal estate of the decedent to pay the claim of Reed if it should be established against such estate. Thereupon the proceedings as to a general account of debts &e., of which notice had been given upon the application of the appellants, were abandoned by consent; and the case was submitted to the surrogate to decide upon the claim of Reed, on the admissions and proofs before him. He decided that Halsey, the decedent, assumed to pay the bond and mortgage and interest, as a part of the consideration of the purchase of the portion of the mortgaged premises which was conveyed to him. He therefore decreed that the personal representatives should pay, out of the estate, to the respondent Reed, $351,60 for the interest which Reed had paid and the costs in the foreclosure suit, and to The Farmers’ Loan and Trust Company the sum of $6000 and the interest, and any unpaid costs in the foreclosure suit; and that the costs of the proceedings before the surrogate should be paid out of the estate of the decedent in the hands of the executor and executrix. From this sentence and decree the executor and executrix appealed, and made Reed and the Farmers’ Loan and Trust Company parties to their petition of appeal. Reed answered the petition. But the other respondents neglected to answer, and the appeal as to them was heard ex parte.

      A. G. Hammond, for the appellants.
    The surrogate ought to have dismissed the proceedings before him upon the application of the respondent, it not appearing that Reed was either creditor, legatee or next of kin. The surrogate had no jurisdiction as between the appellants and the Farmers’ Loan and Trust Company. That Company was not an applicant before him, but had adopted another remedy to enforce their claim. The judgment in the supreme court being for the same cause of action sought to be enforced here, is final as between the appellants and Philip Reed, and a bar to any further claims on his part, on account of the agreement of J. M. Halsey to assume and pay the bond and mortgage.

      W. C. Noyes, for the respondent Reed.
    The surrogate was authorized to direct the amount due the Farmers’ Loan and Trust Company to be paid to them, for the benefit of Reed. For these purposes Reed properly represented the amount due upon the mortgage, he being as between the mortgagees and himself ultimately liable for its payment. (2 R. S. 96, § 74.) The proceedings at law were no bar to Reed’s claims; as at the time they were commenced he had not paid any money, upon which ground alone the circuit judge confined the recovery to nominal damages. The testator was liable to Reed, upon accepting the deed, for the amount of the mortgage which he assumed to pay and subject to which he made the purchase ; especially as it formed a part of the consideration of the lands sold, and was so much money retained in his hands to which Reed was entitled. The clause in the deed is evidence of an undertaking on the part of the testator with Reed, to pay off that mortgage as it should become due, and to make the debt his own. It is something more than an agreement to indemnify against the mortgage 5 it is a contract for the purchase at a given sum, of which the mortgage debt forms a part, and which on the sale is deducted from the consideration money. On a payment by the mortgagor of the whole or any part of such mortgage debt, he may recover the amount so paid from the estate of the testator. (15 Martin’s Louis. R. 607. 3 Ib. 622. 4 Ib. 409. 3 Simons, 1. 1 Ib. 169. Coote on Mort. 493. Parsons v. Freeman, Amb. 115. Cope v. Cope, 2 Salk. 449. Powell on Mort. by Rand, 883 and notes. Billinghurst v. Walker, 2 Brown’s Ch. R. 604. Woods v. Huntingford, 3 Vesey, 28. Warring v. Ward, 7 lb. 332. Cumberland v. Coddington, 3 John. Ch. R. 229.)
   The Chancellor.

The question whether the recovery of nominal damages in the supreme court is a technical estoppel to any further claim against the personal representatives of Halsey for the non-payment of the bond and mortgage, depends upon the true construction of the agreement which is recited in the deed from Reed to Halsey. If it was intended as an absolute and unconditional promise on the part of Halsey to pay the principal and interest of this bond and mortgage to Reed, so as to enable him to sue. and recover upon that promise in his own name, although he had not been compelled or required to pay any thing thereon to the holders of the bond and mortgage the whole contract with Reed was probably merged in the judgment upon such contract j although the amount of that recovery was merely nominal. But if the real intention of the parties to that agreement was that Halsey should assume the payment of the bond and mortgage to the then holders thereof, so as to give them the right to claim the benefit of that promise, as in the cases referred to by Chancellor Kent in Cumberland v. Coddington, (3 John. Ch. Rep. 254,) it was a mere contract of indemnity as between Halsey and Reed. In that case the latter could not recover until he had actually paid something on the bond and mortgage himself. And according to the. decision of the court for the correction of errors, in Wright v. Butler, (6 Wend. Rep. 284,) a recovery for the amount of a partial payment would not bar a new suit for monies which Reed had after-wards been compelled to pay to the holder of the bond and mortgage. Upon the best consideration I have been able to-give to this case, I conclude that the real intention of the parties to the deed of 1836 was, that Halsey should take the land subject to the payment of the whole amount due upon the bond and mortgage, and should indemnify Reed, as the obligor in the bond and as the owner of the residue of the premises included in the mortgage, against the payment of the mortgage debt or any part thereof, but that it was not the intention of either party that Reed should have the right to sue Halsey for this part of the consideration money before Reed should have actually been compelled to pay it for his own indemnity.

It is not necessary to inquire whether the holder of the bond and mortgage could have maintained an action at law against Halsey upon this promise, within the principle of the decisions in the case of Starkey v. Mill, (Style’s Rep. 296,) Dutton v. Poole, (2 Levintz, 210,) and of Schermerhorn v. Vanderheyden, (1 John. Rep. 139.) For whatever may have been their rights at law, there is no doubt that in equity the assignees of the bond and mortgage would have the right to a decree against Halsey or his personal representatives for the deficiency, upon a foreclosure and sale of the mortgaged premises, if the proceeds of the sale should be found insufficient to pay the debt and costs. For it is a well settled principle of this court that the creditor is entitled to the benefit of the collateral obligations for the payment of the debt which any person standing in the. situation of surety for others has received for his indemnity and to discharge him from such payment. (Bank of Auburn v. Throop, 18 John. Rep. 505. Curtis v. Tyler v. Allen, ante p. 432.) I am also of the opinion that a case like the present is within the equity of the provision of the revised statutes authorizing this court, in a foreclosure suit, to make a decree over for the deficiency against a third person who has become responsible for the payment of the mortgage debt; although it is not a case within the letter of the statute, Even if Reed could not compel the holders of his bond and mortgage to resort to the personal liability of Halsey, or to his estate in the hands of the appellants, for the payment of the deficiency after a foreclosure and sale of the portion of the mortgaged premises conveyed by the deed of 1836, he would be entitled to have the decree so framed as to provide for the sale of that part of the mortgaged premises in the first instance. And if that was not sufficient to pay the debt and costs, and he was compelled to pay the deficiency to save his own property from being sold, or in discharge of his personal liability, the estate of Halsey would be clearly liable to him for that amount. Or if he had paid the amount of the bond and mortgage voluntarily to the present holders thereof, he would have had a right to demand an assignment of the same, to enable him to enforce payment out of the part of the premises conveyed to Halsey, and to obtain satisfaction of the deficiency out of the other estate of the decedent. The difficulty in sustaining the decree of the surrogate in this case, however, is that it charges the debt of the testator upon the wrong fund ; by decreeing its payment out of the personal estate exclusively, instead of compelling the creditor to exhaust his remedy in the first place against the part of the mortgaged premises embraced in the deed of 1836. This was unquestionably the primary fund for the satisfaction of the mortgage debt, in the contemplation of the parties to that deed. And by the provisions of the revised statutes it is also made primarily liable for that debt, where the testator has not otherwise directed by his will. For it is clearly within the equity of the section of the revised statutes which provides that whenever any real estate subject to a mortgage executed by an ancestor or testator shall descend to an heir or pass to a devisee, such heir or devisee shall satisfy and discharge such mortgage out of his own property without resorting to the executor or administrator ; unless there be an express direction in the will of such testator that such mortgage shall be otherwise paid. (1 R. S. 749, § 4.) In this case, it is true, the mortgage itself was not executed by Halsey the testator. But he had assumed the payment thereof, and the part of the mortgaged premises embraced in the deed of 1836, descended to his heirs charged with the payment of the whole mortgage debt. The note of the revisers to this section of the statute clearly shows that the intention was to make the premises charged with the mortgage the primary fund for the payment of the debt, in all cases as between the heir or devisee and the personal representatives of the testator or intestate who had assumed the payment of the debt; except where the decedent by his will had made a different provision for such payment. In other words, the object of this section was to abrogate the rule of this court which in certain cases compelled the personal representatives of the decedent to pay off incumbrances upon his real estate for the benefit of the heir or devisee of such real estate.

In the present case I am also inclined to think that the premises conveyed by the deed of 1836, in the hands of the heirs at law of the grantee, were primarily liable for the payment of the mortgage debt, independent of the statute or any understanding of the parties to that deed, according to the English cases on the subject. (See Noel v. Lord Henley, Daniels’ Rep. 330; Forrester v. Lord Leigh, Amb. 171; Tweddell v. Tweddell, 2 Bro. C. C. 101, 152; Butler v. Butler, 5 Ves. 534; 2 Powell on Mort. by Coventry, 863; and Cox’s note to Evelyn v. Evelyn, 2 Peer Wms. 664.) This part of the mortgaged premises therefore being primarily liable for the payment of the whole bond and mortgage, Reed could not by a voluntary payment to the mortgagee charge the personal estate in the first instance. Nor was it equitable for the surrogate to decree a payment of the whole bond and mortgage to the holders thereof, before they had exhausted their remedy by a foreclosure and sale of that part of the mortgaged premises which had descended to the heirs. It does not appear when the respondent Reed paid the $210 towards the interest of the bond and mortgage ; nor why he paid the costs of the complainants in the bill of foreclosure while that suit was still pending and undetermined. I must presume, therefore, that both payments were merely voluntary. The proper course for Reed, however, was to permit the foreclosure suit to proceed to a hearing, and then to ask for such a decree as would compel the complainants to exhaust their remedy by a sale of the portion of the land conveyed to Halsey and which had descended to his heirs. And then if there was a deficiency, so that he was obliged co pay it to save his own portion of the premises from being sold, he would have had a valid claim for the amount thus paid, and the costs to which he had been subjected in the foreclosure suit against the personal estate of Halsey, in the hands of his executor and executrix. For in those cases in which the real estate in the hands of the heir or devisee is primarily "liable for the debt, as between the owners of such real estate and the personal representatives of the decedent, the personal estate may still be liable to the creditor where the primary fund is insufficient for that purpose.

The surrogate, however, in decreeing distribution of the personal estate among the creditors of the decedent, should do what this court would do upon a bill filed here for an account and distribution of such estate in the hands of his personal representatives—compel the creditor who has an additional security upon another fund which is primarily liable, to exhaust his remedy against that fund, and only to come in as against the personal estate for the deficiency. And where it is necessary to make a distribution of the estate before such deficiency can be ascertained, he should direct a portion of the fund in the hands of the executor or administrator to be retained to meet the contingent claim for the deficiency. In this case I think the surrogate should have either dismissed the petition of Reed without prejudice to a future application ; or should have suspended proceedings thereon until the deficiency, if any, for which the personal estate might be liable, was ascertained by the result of the proceedings in the foreclosure suit. The will of the decedent is not before me, and I cannot, therefore, see whether the interests of the widow and heirs in the real and personal estate are the same or not. But the presumption is that they are different. For in the absence of any provision in the will on the subject, the widow would he entitled to one third of the personal estate absolutely i whereas in the real estate she takes but a life estate in the third thereof. It is therefore important to the interests of one of the appellants, at least, that the mortgage debt should be charged upon the proper fund.

The decree of the surrogate must be reversed, and the proceedings dismissed. But without prejudice to the rights of the respondents, or either of them, to institute new proceedings before the surrogate, after the remedy against that part of the mortgaged premises embraced in the deed of 1836 shall have been exhausted, to compel payment of the deficiency if any, and any other legal claims arising out of the contract of sale between Reed and Halsey, out of the personal estate in the hands of the executor and executrix, or otherwise, as the respondents may be advised. And neither party is to have costs as against the other either on this appeal or on the proceedings before the surrogate. As the rights of the parties also may have been materially changed by the proceedings in the foreclosure suit during the pendency of this appeal, any of the parties are to be at • liberty to file a bill in this court, if necessary, to settle their rights according to equity, if they shall be advised that it is proper to do so.

         See Curtis and others v. Tyler & Allen, ante p. 432


author: The Chancello».

text:
    The Bank Commissioners vs. The James Bank.
    To authorize the bank commissioners to proceed against a banking association for a forfeiture of its charter and banking privileges, it is slot sufficient that its circulating notes should have been once presented to its agent for payment 4 but such notes must either be left at the agency for twenty days, or must be presented a second time for payment at or after the expiration of twenty days from the time of their first presentation.
    Where the circulating notes of a banking association are not paid immediately upon their first presentation to the agent of the association for payment, the holder of such notes may sue the association, to recover the amount thereof and the twenty per cent interest, without waiting twenty days. To enable the holder of the circulating bills of a banking association to apply to the comptroller for payment, or to subject the association to a forfeiture for non-payment for twenty days after demand of payment at the agency, it is not necessary that such holder should present the second time such bills for payment, at the last moment of the business hours on the twentieth day after they were first presented, or even on that day. But the association which has once made default in paying its bills at the agency, must at its peril provide its agent with funds to redeem those bills whenever they are again presented for payment, at or after the end of the twenty days from the time of their first presentment.
    March 15.
    This was an application by the bank commissioners for an injunction for the appointment of a receiver of the property and effects of the James Bank, an association organized under the provisions of the general banking law, and located in the town of Greenfield in the county of Saratoga, The petition of the commissioners, after stating the organization of the association and that in pursuance of the provisions of the act, of the 4th of May, 1840, relative to the redemption of bank notes, the association appointed the Albany Exchange Bank its agent for the redemption of all circulating notes of the James Bank which should be presented to such agent for redemption or payment, alleged upon the information and belief of the petitioners, that in the month of November, 1841, and on or before the 30th of that month, a parcel of the circulating notes of the James Bank were presented at the office of the Albany Exchange Bank, as such agent, for redemption; that the last mentioned bank, as such agent, refused and neglected to redeem the same; and that the same had not been redeemed on the 5th of January, 1842, when the affidavit annexed to the petition was made. The petitioners therefore, charged that the agent of the James Bank had neglected and refused to redeem its circulating notes on demand, and that such redemption had not been made by the agent at its office in Albany within twenty days after such circulating notes were presented there for payment. The petition also stated, upon information and belief, the presentment of circulating notes of the association for payment at its place of business, and a similar refusal to redeem, and that such notes remained unredeemed. To the petition was annexed an affidavit of the cashier of the Albany Exchange Bank, stating the presentment of the parcel of bills at the agency for redemption, in November, 1841, and that such agent neglected and refused to redeem them, and that the same had not since that time been redeemed by such agent.
    An order to show cause why a receiver should not be appointed, and an injunction granted, having been entered and served, together with a copy of the petition and accompanying affidavit, the president of the bank appeared and showed cause. He did not deny, either upon his belief or otherwise, the allegation in the petition and affidavit that the circulating bills of the bank had been presented at the agency,and the redemption thereof refused, and that the bills had not been paid by the agent, for more than twenty days. But he stated, upon his belief, that for some months previous to the presenting of the petition in this matter, all the circulating notes which had been presented at the banking house of the association were duly paid and redeemed on presentment. He also produced the affidavit of the cashier of the association, who swore positively that all its circulating notes which had been presented at its banking house for payment since the month of August, 1841, had been paid and redeemed at par. An explanatory affidavit of the cashier of the agency bank at Albany was also produced, stating that he did not know that any of the package or parcel of the circulating notes of the James Bank, alluded to in his affidavit annexed to the petition of the bank commissioners, had been presented a second time at the agency for redemption.

      ■A. Taber., for the Bank Commissioners.

      8. 3. Cowen, for the James Bank.
   The Chancello».

Upon a careful examination of the provisions of the act of 1840, relative to the redemption of bank notes by the agents of banks and of banking associations, I have arrived at the conclusion that the counsel for the defendants is right, in this case, in supposing that it is necessary to leave the circulating notes at the agency until the termination of the twenty days from their first presentment for payment, or to present them a second time, at or after the expiration of that period, in order to render a neglect to redeem such bills at the agency and to pay the extra interest thereon, an absolute forfeiture of the charter of the bank, or of the franchises of the banking association. The whole question arises under the fifth section of the act. (Laws of 1840, p. 155.) The first clause of this section is remedial, and gives to the bill holder, who makes a demand of payment at the agency, interest at the rate of twenty per cent per annum, from the time of the demand and refusal of payment. He may, therefore, immediately sue the bank, or association, and may recover the amount due him upon the bills together with the extra interest given by the statute. Or he may wait the twenty days and then again demand the payment of such bills, with interest, for the purpose of subjecting the bank to a forfeiture of its privileges if such payment is again refused ; and to enable him to apply to the comptroller for payment, under the last clause of this section, if his demand is against an association organized under the general banking law.

The second and third clauses of this section, however, are highly penal; the second rendering the bank liable to be proceeded against by the bank commissioners for a forfeiture of its charter, and the third absolutely prohibiting such bank from ever again putting in circulation any of its bills or notes after default in payment at the agency has continued for more than twenty days. This part of the section, therefore, must be construed with some degree of strictness; or at least in such a mannér as to enable the bank to save the forfeiture by redeeming the particular bills at its agency, and paying the interest thereon, before it shall be subjected to such serious consequences. And I do not see how this can be done without requiring the holder of the bills to leave them with the agent bank for the twenty days, or to present them again at the agency, at or after the expiration of that period. It cannot, however, be necessary that the holder of the bills should present them the second time at the last moment of business hours on the twentieth day, or even on that day. For the bank which is in default in not paying its bills at the agency when they were first presented for redemption, must at its peril provide its agent with funds to redeem such bills whenever they are again presented for payment at or after the end of the twenty days from the time of their first presentment.

It is not stated in the petition in this case who presented the bills which wrere not paid at the agency nor are the numbers or the amount of the bills presented, nor any other description of them given, so as to enable the defendant to ascertain whether they have not been redeemed at the banking house in Greenfield, where it is sworn the bank has continued to redeem its bills without interruption since August last. But as the petition is founded upon the affidavit of the cashier of the agent bank, it is not the fault of the bank commissioners that the agent of the defendant has not. furnished the officers of the James Bank the necessary infer mation to enable them to determine whether the package referred to in the petition was not presented and paid at the banking house of the association, at Greenfield, within the twenty days. I think there is very little reason to doubt that the bills which were presented at the agency were not in fact redeemed within the twenty days; and what is most probable that many parcels were presented for payment and refused, and were not redeemed either there or elsewhere within twenty days after they were thus presented at the agency. But I am obliged to refuse this application, upon .the construction of the statute that it must be satisfactorily shown that the bills were at the agency for redemption at the end of the twenty days, or were presented there for payment afterwards, so as to enable the defendant to redeem them at that place ; though I do not> in fact believe the bills in this case would have been redeemed if they had been thus presented the second time at the agency.

The order to show cause must be discharged and the petition dismissed, and the temporary injunction is of course dissolved ; but without prejudice to the right of the petitioners to renew their application, if they shall think proper to do so, upon a new state of facts.