author: Denio, Ch. J.

text:
    Roome, Administratrix, &c., v. Philips.
    In an action for specific performance, each party moved for-an order direct-^ ing different modes of effecting a conveyance of the title to the defendant. One motion was granted, at special term, and the other denied. On appeal, both orders were reversed, at general term. No appeal lies from such orders to this court, they not making a determination of the action or preventing a judgment from which appeal could be taken.

      It seems that it should be considered settled that an administrator with the will annexed is not authorized by the statute (2 R. S., p. 72, § 22) to execute a power to sell land conferred by the testator upon his executor.

      It seems that the Supreme Court may appoint a trustee to execute the power, but that the heir-at-law is a necessary party to the action or proceeding in which an order for that purpose is made.
    A power conferred upon an executor to sell real estate on such terms as he might think proper is, it seems, inapplicable to land for the sale of which the testator had made an executory contract and tendered performance in his lifetime.
    When the administrator with the will annexed had been appointed trustee to execute the power, and asserted the right to execute it in respect to such land, he ought to join with the heir-at-law in executing a conveyance, in performance of the testator’s contract.

      This was a second appeal in the case reported 24 N. Y., 468. The plaintiff is there called the administratrix of an intestate, whereas, in fact, she was administratrix with the will annexed, the executor appointed by the testator having renounced. The executor was directed by the will to sell and convey all the testator’s “ real estate either at public or private sale, and -upon such terms as he may think proper and most beneficial.” The other facts sufficiently appear in the following opinion. ”

      William S. Sears, for the appellant.

      Livingston K. Miller, for the respondent.
   Denio, Ch. J.

This action was commenced in February, 1860, by Elisha Burrows, of whom the present plaintiff is the administratrix, with the will annexed. Its object was to compel the specific performance of a written contract, by which the defendant agreed to purchase of the original plaintiff a lot of land in the city of Hew York. The agreement, as set out in the complaint, bore date September 14th, 1859, and by its terms the plaintiff agreed to sell and convey to the defendant, and the latter agreed to purchase the lot in question for $4;000, the conveyance to be delivered on the 5th October following, at a place named, the defendant agreeing, upon receiving the deed' at the place mentioned, the title being good,” to pay the plaintiff the said amount. The purchaser was to have the rents from the 1st October, allowing interest from that day until the 5th, when he was to have possession. The complaint averred the execution of a deed, and that the-plaintiff attended at the time and place agreed on for its delivery, but that the defendant did not appear to receive it. In addition to these statements, the complaint set forth the will of the plaintiff’s father, Elisha Burrows, senior, under which he claimed title to the premises, and the death of a party-who had a prior life interest therein. Before any further proceedings were had, and on the 27th February, 1860, the plaintiff died without issue, having by his will, dated May 4, 1859, named one John Colyer his executor, and directed him to sell and convey all his real estate, and to pay over the proceeds, after payment of his debts, to his mother and aunt, in certain proportions. Colyer renouncing the executorship, letters of administration, with the will annexed, were issued by the surrogate to the present plaintiff, who caused herself to be substituted as plaintiff; and the defendant then demurred to the complaint.- The question upon the demurrer depended upon the construction and effect of the will of the elder Burrows. The Supreme Court, at special and general term, sustained the demurrer, and judgment was given in favor of the defendant, with costs, that court holding that by the effect of the will, in connection with the events which had happened, the original plaintiff had not, at the time of entering into the contract, any title to the premises. Upon appeal to this court, the judgment of the Supreme Court was reversed with costs, and judgment was given for the plaintiff, but with leave to the defendant to answer the complaint; and the record and proceedings were ordered to be remitted to the Supreme Court, to be proceeded upon according to law. The determination here was, that Elisha Burrows, the vendor and original plaintiff, acquired a legal title to the premises by the will of his father, and that he held such title when he contracted to sell them to the defendant. It became the duty of the Supreme Court to give effect to this judgment by such further proceedings as the circumstances of the case required. The formal judgment for the plaintiff, pronounced here, did not complete the process, for the deed which had been executed had become ineffectual and void by the death of the grantor before delivery, and the court could not, upon principles of equity, compel the defendant to part with the price, unless the plaintiff was able to give him a valid title to the land. The vendor having died without having devised an estate in the premises to any one, they descended to his heirs-at-law, subject to the power given to the executor to sell and convey them, provided' that power attached to land which the testator had already sold and agreed to convey by an executory contract. There was, besides, an account to be settled respecting the rents and profits. The vendor and his representatives had continued in possession, but the purchaser, paying interest on the purchase price, was entitled to the rents. It would have been a correct course for the Supreme Court, upon being possessed of the case, by the filing of the remittitur, to have entered a judgment in conformity with the determination which had been made here, and upon the application of either party to have ordered a reference to ascertain whether the plaintiff could furnish to the defendant a good title,'and to adjust the account of rents and interest, and settle the amount to be paid by the defendant; and upon the coming in of the report to have perfected the details of the judgment. The course which was in effect pursued was this: The defendant, on affidavit, showing that he was ready to complete the purchase, if a good title could be made to him, obtained an order to show cause why an order of reference, with other directions, should not be granted. These affidavits assumed the title to have been in the vendor at the making of the contract, as we had decided, but suggested that the deed which he had executed in "his lifetime, and a deed from the plaintiff, as-administratrix, with the will annexed, which seem to have been offered, would not constitute a sufficient title, and claimed that the heir-at-law of the vendor, who was his mother, Mrs. Hersfield, together with her husband, and a trustee, to be duly appointed in the place of the executor who had renounced, should unite in a deed to him, upon which he professed a willingness to pay the amount of purchase-money due and complete the transaction,,

The time of showing cause was the 18th August, 1862, the judgment of this court having been pronounced at the preceding June term. The motion was not heard on the day named, but on the succeeding day, the 19th August, the plaintiffs applied, at a special term, upon the production of the remittitur from this court, and evidence that it had been served on the defendant’s attorney, and obtained an order to the effect that the defendant should receive the deed of the present plaintiff, as administratrix, with the will annexed, of the vendor, who, it was recited, had been appointed by the Supreme Court a trustee to execute the power of sale contained in the will of the vendor, and pay the purchase price of $4,000, with interest thereon from October 1, 1860, together with the costs and expenses of the suit, and an additional allowance, which were liquidated at a sum amounting in the aggregate to $5,177.43; and that in default of such payment the premises should be sold at the Merchants’ Exchange, on three weeks public notice, and that the above amount should be paid to the plaintiff, if the sale realized so much; and that in case of a deficiency the plaintiff should have judgment against the defendant for such deficiency. From this order the defendant appealed to the general term. The defendant’s motion, pursuant to the order to show cause, was made on the 21st November following, and was denied with costs, and the defendant appealed from that determination to the general term. These appeals were brought on together, and the orders appealed from were both reversed, with costs, on the 7th day of March, 1863. From the determination of the general term, in reversing the two orders of the special term, the present appeal is taken. From this statement it is quite apparent that the orders appealed from are not final in the sense of the Code, so as to be appealable to this court. They leave the case in the same situation in which it stood when the record was remitted to the Supreme Court, after we had reversed the judgment in favor of the defendant The main question upon which the case originally depended had been settled in favor of the plaintiff, but the title to the land had devolved upon the heir-at-law of the vendor, who was not a party to the suit. Although the effect of our determination was that the defendant ought to have received the deed which was formally executed at the time fixed by the contract for the conveyance, still hé had a right to litigate the question as to the vendor’s title, and the judgment which he obtained upon that question in the Supreme Court shows that the point was not without difficulty, and that the litigation may well have been carried on in good faith. But, however that may be, a devolution of title occurred pending that litigation, and when the plaintiff had obtained a determination in favor of the vendor’s original title, that title had become vested in another party; and courts of equity, as I have stated, do not compel a vendee specifically to perform the contract of purchase, unless the plaintiff can furnish him with a good title. Whether the plaintiff, as administrator of- the vendor, with his will annexed, was clothed with the powers which the will conferred upon the executor named in it-—• whether the premises in question were subject to that power, seeing that the vendor had already sold them by an executory contract—and, supposing them to be embraced in the power, and that it could only be executed by the execute,r named or a trustee substituted in his place, under the power now vested in the Supreme Court, to supply a trustee wnere one has resigned, whether the renunciation of an executor, who is clothed with a trust power is such a resignation as would authorize the appointment of a substituted trustee, or whether, under the circumstances, a good title could not be made without a conveyance from the heir-at-law—were questions to be determined by the Supreme Court before a final judgment in the action could be pronounced. The special term had made an order obliging the defendant to receive a conveyance to be executed by the plaintiff as administrator and trustee, but this had been reversed by the general term. The opinion of the court, given upon reversing the orders of the special term, was to the effect that the heir, together with her husband, must join in a conveyance to be executed also by the plaintiff, as administratrix and trustee, after an appointment as trustee upon proceedings of which the executors must have notice, and that before final judgment could be given, an adjustment of the accounts respecting the rents and profits must be made. If the plaintiff is unable or unwilling to do more than to execute the conveyance referred to in the order of the special term, he can procure an order dismissing his complaint, on the ground that he cannot make a good title, and can then appeal here from that determination; or if he is willing to comply with the conditions which the general term has declared to be reasonable, he can make a fresh application to the special term for a judgment' requiring the defendant to perform his contract, on the plaintiff’s fulfilling these conditions. As the case stood when the present appeal was taken, the action was pending' and undetermined in the Supreme Court, and no order had been made by the general term which in form or effect determined the action or which prevented a judgment from which an appeal might be taken. It follows that the appeal was premature and that it must be dismissed.

As it may save expense to these parties, we have looked into the questions of law supposed to be involved in the appeal, and which have been argued before us. The power of the administratrix, with the will annexed, to execute the power to sell, given to the executor, is not insisted on by the appellant’s counsel. As an original question, I should have supposed that the statute covered the case, atid that the administratrix was competent to execute the power (2 R. S., 72, § 22); but this has been held otherwise, in two deliberately considered cases, in the courts of original jurisdiction; and though the doctrine has been questioned by some members of the Court of Errors, it has not been overruled, and should be considered as settled adversely to the right of the administrator. (Dominick v. Michael, 4 Sandf. S. C., 374; Conklin v. Egerton, 21 Wend., 430; S. C, 25 id., 224.)

I entertain no doubt of the authority of the Supreme Court to appoint a trustee to execute the power,- but I question the validity of the appointment which was made in this case, the heir-at-law in whom the title was vested not being a party to the action in which the order was made, and there being no evidence that the person upon whom, as her attorney or agent, the notice was served, and who consented to the order, was authorized to act for or represent her in that behalf.

But there is a further difficulty in this case. The power of sale conferred upon the executor by the will, had become inapplicable to this land, by the sale of it which the testator had made in his lifetime. The will directs the executor to sell and convey all the testator’s “ real estate, either at public or private sale, upon such terms as he may think proper and most beneficial ” to his estate. But the manner of sale, and the terms, had all been conclusively determined by the testator before the will took effect by his death, and a sale had actually been made; and the power does not look to the conveyance of the naked title to lands, of the beneficial interest in which the testator divested himself in his lifetime. The sale was not a revocation of that part of the will, express or implied, so as to require an attested instrument to satisfy the statute, nor was the case within the provision which declares that a contract by the testator for the sale of land devised shall not revoke the devise antecedently made (12 R. S., 64, § 45); for the land in this case was not devised, though the proceeds of the sale were. Simply, the duty which the executor was appointed to perform respecting this land, could not be performed by him, because, at the death of the testator, there was no such land to be sold.

We are, therefore, of opinion, with the general term of the Supreme Court, that the defendant is entitled to a conveyance from the heir, in which the plaintiff ought to join, as administratrix and trustee, because she asserts a right to execute the power in these capacities; and there ought also to be a reference to determine the amount to be paid by the defendant.

Rosekrans, J., did not sit in the case; all the other judges concurring,

Ordered accordingly.


source: Caselaw Access Project

author:
Wright, J.
      Marvin, J.

license: Public Domain

text:
    Milliken v. Dehon, Executrix.
    Upon the consignment for sale of cotton in store with third parties at New York city, the consignee made an advance of 11¿ cents for each pound, to be repaid at a day certain, under an agreement that, should there be a decline in the market price of cotton, the consignor should, on demand, deposit cash sufficient to cover such decline, and if he failed to do so,_or to repay the advance at a fixed day, the consignee might sell the cotton at public or private sale, or otherwise, at his option, for the most it would bring. This, if a pledge at all in a legal sense, was a peculiar contract, including more than a pledge, and to be construed upon its own language and circumstances.
    The consignor having failed to make good a decline in the market price of cotton, the consignee was at liberty to sell in the mode usual in the New York market, without giving notice of his intention or of the time or place of sale.
    The consignee is bound to give notice of a decline and make an actual demand for the margin: such demand need not be personal, but may be made of the consignor’s clerk, employed by him as his agent in the particular transaction.
    Appeal from an order of the Superior Court of the city of New York, granting a new trial, with stipulation for final judgment; Action against Theodore Dehon (who, pending the suit, died), to recover damages for an alleged wrongful conversion of 130 bales of cotton. About the 7th of November, 1860, the plaintiff, who was the owner of 130 bales of cotton, stored with Briever& Caldwell, and the New York Warehousing Company, consigned the same to Dehon for sale, and on such consignment the latter advanced to the plaintiff $7,000, „ on his note, at sixty days from date, with the agreement that on the 4th January, 1861, the plaintiff would pay to Dehon in cash, less five days’ interest, the $7,000, with one per cent commission for the loan of the advance; and in default of so doing, Dehon might sell the cotton, at public or private sale, or otherwise, at his option, for the most that it would bring. The same right was to be exercised by Dehon, should a decline occur in the market value of the cotton, and the plaintiff fail, whenever demanded, to deposit in cash, sufficient to cover such decline ; so that, at all times, Dehon should have a margin of one and one-fourth cents per pound in his hands. If the property was sold by reason of default, an additional commission of one and one-half per cent was to be allowed Dehon, also the customary charges incident thereto; and should a surplus result, over and above Dehon’s advances and charges, he was to pay the same over to the plaintiff; and if a deficit, the plaintiff was to pay the same to Dehon in cash, on receiving a statement of account.

      The weight of the cotton was 61,990 pounds; so that the advance of $7,000, was Ilf cents per pound, and a margin of ,1J cents would increase that to nearly 12f cents per pound, There having been a decline in the market value of the cotton, on the 16th December, Dehon employed a cotton broker to sell the cotton, and it was sold on the 26th December, for 11J cents per pound, being the highest market price at that time, and more than could have been obtained for it for ten days previously. It was sold by sample, not at public sale, but in the 'ordinary way-that the article is sold in the New York market. There was no proof that the plaintiff had any notice of the time or place of sale.
    The evidence was conflicting, whether before this sale Dehon gave notice to the plaintiff that the price of cotton had declined below the margin stipulated in the contract, and demanded of him that he should make the margin good. On the part of the plaintiff, James Douglass, who was employed by the plaintiff as a clerk, and who sometimes did out-door business, and who, in fact, negotiated the loan on the cotton,' testified that the plaintiff at no time, through him, or otherwise, had been notified of the decline, and required to keep good the margin. On the part of the defendant three witnesses gave testimony which, if credited, tended to show, conclusively, that the plaintiff had been notified of the decline in the market value of the cotton; that Dehon had demanded, between the latter part of November and middle of December, that the margin should.be made good, claiming that the cotton had fallen below the margin; that Douglass admitted the decline, stated that the plaintiff could pay no additional margin, • and wanted him finabstain from selling, if possible; that Dehon refused, saying to him that the plaintiff must make the margin good, if he wanted him to hold on to the goods; that he must make the margin good the next day, and if he did, not he would sell. The court submitted the question to the jury, whether Dehon did demand of the plaintiff that the margin should be made good by him, and whether the price of cotton bad fallen, at the time, below the amount specified in the contract, and the jury found on these issues against the plaintiff.
    On the 5th January, 1861, the plaintiff offered to Dehon a certified check for the amount of the advances and charges on the -cotton, and demanded from him the 130 bales. Dehon refused to accept the check, alleging that he could not deliver the cotton, as he had sold it. The market price of this cotton on the 5th January, at the time of the demand, was 12£ cents per pound, and its highest market price prior to the trial in February, 1862, was 38 cents per pound. This was about the middle of December, 1860.
    The court charged the jury, that if they found that before the sale of the cotton by Dehon, the margin was deficient, and that a demand was made by Mr. Dehon on Mr. Douglass to make the margin good, and that Mr. Douglass was at the time the agent of the plaintiff, and that the demand was not complied with by Mr. Milliken, then their verdict should be for the defendant. To this the plaintiff excepted. But if they found that Mr. Dehon, without giving such notice, sold the cotton, he sold it in violation of the rights of Mr. Milliken, and on the 4th January Mr. Milliken had a right to tender the amount of the loan, and to demand the delivery of the cotton to him; and he was entitled to recover.
    ■ The plaintiff’s counsel asked the judge to charge, the following propositions:
    1. That Mr. Dehon had no right to sell the pledged property until he had caused a demand of payment of the margin to be made, personally, of the plaintiff.
    2. That in order to -have authorized a sale of the cotton which was the subject of the pledge, by the pledgee, without judicial proceedings, notice to redeem should have been given to the plaintiff.
    3. Notice of the sale should also have been given to the plaintiff.
    4. Notice of the time, place and manner of the sale .should also have been given to the plaintiff.

      5. That such notices should have been, personal to the plaintiff.
    The judge declined to charge the propositions, and to the refusal the plaintiff excepted.
    The jury found a verdict for the defendant. The exceptions were directed to be heard, in the first instance, at general term, on a case to be made.
    The court, at general term, set aside the verdict and granted a new trial; and from this order the defendant appealed to this court, stipulating that, if such order be affirmed, judgment absolute should be rendered against said defendant. .

      D. B. Eaton, for the appellant.

      E. W. Stoughton, for the respondent.
   Wright, J.

This seems to be a plain case. In the early part of November, 1860, the plaintiff, who was the owner of 130 bales of cotton, applied to the defendant’s testator for a loan or advance thereon of $7,000, which, as the plaintiff estimated. the weight of the cotton, was equal to 10$ cents per pound, and according to its actual weight, 11J cents per pound. The advance was made upon conditions specially agreed on, and without which it is reasonable to assume it would not have been made. The plaintiff was to consign or pledge to Dehon the cotton, which was an article of fluctuating value in the market, the plaintiff agreeing to repay the advance on the 4th January following. Special authority was given to Dehon to sell the cotton “at public or private sale, or otherwise, at his option, for the most that it would bring,” in two contingencies: 1st. If a decline should occur in the market value, and the plaintiff failed, whenever demanded, to deposit, in cash, sufficient to cover such decline, so that Dehon should at all times have in his hands a margin of 1J cents per pound; and 2d. If the plaintiff should make default in the payment of the advance, in- cash, on the 4th' January, 1861, less five days’ interest, with one per cent commission. This was something more than a mere pledge, where the pledgor would be entitled to notice to redeem, and also notice of the time and place that the pledged article would be publicly exposed to sale. Indeed, it is doubtful whether, in a legal sense, a pledge of the cotton was made at all, or that, strictly, the relation of pledgor and pledgee was created. A pledge is defined to be “ delivery of goods by a debtor to his creditor, to be kept till the debt be discharged.” (Jones’ Bail., 117; 2 Kent’s Com., 577.) Here there was a constructive delivery of the cotton before any relation of debtor or creditor existed, and not by way of bailment, but as a consignment. It was a peculiar contract between the parties, and is to be construed according to its own language and circumstances; and I apprehend that any apparent difficulty grows out of a perversion of it by a nice adhesion to rules at best only applicable to relations of strict and simple pledgor and pledgee.

It was certainly competent for the plaintiff to contract (with the view of fully securing -the advance) that Dehón should hold the cotton, and if its value declined in market, he would deposit a sum in cash equal to such decline, so that the consignee or pledgee would at all times have in his hands a margin of 1J cents per pound; .that is, a cash deposit which, would increase the value of the cotton cents per pound beyond the current market price; and' it was ■ equally competent for the plaintiff to agree that, failing to do so, whenever demanded, Dehon should have the right to dispose of the cotton “ at public or private sale, or otherwise, at his option, for the most that it would bring.” The plaintiff cannot legally insist that he should have notice of the time and place of sale, that he had expressly agreed might be public or private, or otherwise, as the consignee or pledgee should determine. In case of a simple pledge with a mere right of sale, the sale must be public, and notice given of the time and place. But here the right of sale is enlarged by expressly yielding the privilege of claiming a public sale, and authorizing the party to sell at private sale. The private sale spoken of in the contract, and which was within the intention of the parties, was clearly a private sale, to be made in the ordinary way, without notice of time or place, and known and made public to the parties thereto alone. Under the clause allowing a sale for a fall below the margin agreed to be kept up, no prompt sale, adequate to protect the pledgee from loss, and such as was .evidently contemplated, could be made, if it was necessary to serve a notice of time and place of sale on the plaintiff. The whole proceeding would be ridiculous and impracticable. It is impossible to raise from the language of this contract, as the Court below attempted to do, an implied obligation to give notice to the plaintiff of the time and place where the cotton would be sold for his default. The parties did not intend it; and, ordinarily, it would be impracticable to affect a private sale of a lot of cotton, in the way such sales are usually made, if such notice was required to be given.

With this view of the law, the only question in the case was one of fact, viz., whether the plaintiff had made default in keeping up the margin, at the time of the sale of the cotton by Dehon. If he had, then Dehon was justified in selling. If he had not, the sale was wrongful. Two things must have concurred to put the plaintiff in default—a decline in the market .value of cotton below the margin stipulated in the contract, and a demand, by Dehon, that the plaintiff should make such margin good. The jury were substantially so instructed by the judge at the trial; and the. findings of the jury upon these questions of fact were, in effect, against the plaintiff. After a charge, in which they were distinctly instructed that, before Dehon could sell the. cotton, the price must have fallen below the amount specified in the contract, and he must also have demanded of the plaintiff that the margin should be made good by him, they found for the defendant.

The judge was requested to instruct the jury that Dehon had no right to sell the pledged property, until he had first caused a demand of payment of the margin, to be made personally of the plaintiff. If by this was meant that there should be an actual, instead of a constructive, demand and notice, the request was unobjectionable. But this was not the meaning. The loan had been negotiated through one Douglass, a clerk of the plaintiff, who sometimes did out-door business for him; and the proof tended conclusively to show that he acted as the plaintiff’s agent in the particular transaction. Douglass had several interviews with Dehon in the month of December, while samples were in the hands of the cotton broker, in relation to the threatened sale of the cotton. He knew of the decline, and that the margin was deficient, and in these interviews, urged that the sale should be delayed. He was told, that if the plaintiff did not pay the margin within a day or two, the cotton would be sold; that Dehon had already borne with the plaintiff for some time, and could not longer take the riskand when requesting delay, represented that it was inconvenient, or indeed quite impossible, for the plaintiff to pay up his margins. This evidence showed that the-demand was made to Douglass, and not to the plaintiff in person. Accordingly, the judge charged the jury that if they found that a demand was made on Douglass to make the margin good, it would be necessary to determine whether Douglass was authorized by the 'plaintiff to receive a notice of that kind, and that would depend entirely upon the question whether Douglass was the agent of the-plaintiff or not. If Douglass was the agent of the plaintiff in the transaction of the business, and notice was given to him requiring that the margin should be made good within one or two days, as testified to by some of the witnesses, then such notice was sufficient to the plaintiff. It was to the proposition in the charge, that demand and notice to the agent transacting the business was sufficient notice to the principal, that the plaintiff’s counsel took exception, insisting that to authorize a sale, the demand should have been made personally on the plaintiff. But, clearly, this was unnecessary to put the latter in default, if Douglass was authorized to receive the notice for him. The evidence tended to the conclusion that he had such authority.

Questions were put to the plaintiff, as a witness, with the view of showing that no demand had been made on him personally, and excluded. This exclusion had no important bearing on the rights of the parties. It was not pretended that any demand had ever been made upon the plaintiff, individually ; and if the law required such a demand, it was conceded that the sale was without authority. It was quite unnecessary that the plaintiff should testify to the fact, to .enable his counsel to raise the question of law. I think no error was committed at the circuit, and that the order for a new trial should be reversed, and judgment rendered on the verdict for the defendant.

Marvin, J.

It is very properly conceded, in the opinion of the general term, that any or all of the pawnor’s rights can be waived or modified by consent, including notice of time and place of sale. But it is said that there is no express waiver of such notice in this case, and that none should be implied.

Let us turn to the contract between the parties. Should a decline occur in the market value of said merchandise, and I fail, whenever demanded, to deposit in cash sufficient to cover such decline, &c., then “ the right is hereby given you to sell this merchandise at public or private sale, or otherwise, at your option, for the most it will bring.” The merchandise was-cotton. It was stored in two warehouses in Hew York. The mode of selling cotton in Hew York is by sample, exhibited by a broker, employed' for such purpose. The usual course was adopted in this case, and the plaintiff, by his agent, knew that the samples were with the broker. He knew that the defendant intended to sell the cotton, unless the margin was made good, and he wanted the defendant to abstain from selling, if possible, and the defendant refused, unless the margin should be made good the-next day, the witness thinks, or he would sell. This was some days before the sale. The cotton was on sale for more than two weeks, and the plaintiff, by his agent, knew the fact, and at one time expressed the hope to.the brokers that they would not sell-it, but hold it a few days longer, and use their influence with Dehon. It was proved that the cotton was sold in the usual way; that there was no other way of selling cotton, except by samples. Can it be said, in the light of these facts, that it was necessary that notice of the precise time and place where the sale would be made should be given ? This is the position assumed, and it mqst'be fully sustained to justify a new trial. All contracts should receive a fair and reasonable construction, having regard to the subject matter of the contract.

The general rule, in the absence of a contract affecting the question, is, that the pledgor must have notice of the time and the place of sale; and the principal reason assigned for the rule is, that he may have an opportunity to attend the sale, and see that it is fairly conducted: that he may exert himself in procuring buyers, and thus enhance the price; that he has, in fact, the right to redeem the pledge at any moment before the sale shall be actually made. These rules should be carefully adhered to, in all cases in which they are applicable. They may. be modified or waived by agreement; and in case a special agreement has been made between the parties, controlling their rights, it is subjected, like other agreements, to the well-settled rules of construction. In the present case, the agreement was, upon the happening of a specified contingency, that the pledgee should have the right to sell the pledge, at public or private sale or otherwise, at his option, for the most it would bring. The pledge was cotton, in certain warehouses in the city of New York. Cotton, under such circumstances, is usually sold by brokers, employed for such purposes, and always, or at any rate usually, by samples. The broker offers the cotton for sale, and those persons who desire to purchase examine the samples and make offers, or a price is proposed by one of the parties, and it is accepted or declined, as the case" may be; and this course is proceeded in until a sale is effected. It may be said that the sale is private; and yet it may have partaken largely of a public character, the samples having been exhibited to many persons, for days in succession, attended by negotiations for sale and purchase, as in the present case. The cotton being on sale, and the broker, being instructed to sell “ for the most it will bring,” is ready to close the bargain whenever the largest price the cotton will bring is offered. He may have such offer at any moment, or it may he days before a satisfactory offer is made. How is it practicable to give notice to the pledgor of the time and place of'sale ? Any offer made, may be withdrawn, unless accepted at.once, and thus a desirable sale may be lost. It is not denied that the defendant had the right to make a private sale; but this, it is said, did not give him the right to sell without notice to the pledgor of the time and place; and I concede that notice may be necessary in some cases where the authority is to sell at private sale, as will be noticed hereafter. But was such notice required in' this case ? Did the parties to the agreement contemplate such notice? I think not. They knew the course of trade, the mode of selling cotton-; and they contracted in reference to such mode. They knew that brokers were employed; that they made sales by sample; and that such samples were exhibited, sometimes for days and weeks, until a sale should be effected. The parties contemplated a fair sale, in the well understood mode of making such sales, and ’must have seen that a notice of the time and place of sale would be extremely inconvenient, if not impracticable; and, in my opinion, neither of the parties to the contract contemplated any such notice. The contract goes further. It authorizes a public sale, or a sale otherwise. But it is not necessary to remark upon the powers thus conferred, as the sale was fairly made in the only usual way.

If we again refer to the reasons of the rule requiring notice of the time and place of sale, it will be seen that all the reasons were, in this case, fully satisfied. The cotton was “ on sale-” two or three weeks; the plaintiff, by his agent, knew the facts, had interviews with the brokers offering the cotton for sale, and had full and ample opportunity to procure friends, or persons dealing in cotton, to go and examine the samples, and purchase the cotton at the highest price; and, for aught we know, may have exerted himself to this end. It seems to me that he had all the notice which the reasons of the rule can require. There is no complaint of any secrecy or unfairness in the sale.

Let us examine the cases cited by the plaintiff’s counsel. In Stearns v. Marsh (4 Den., 227), there was no special agreement affecting the questions decided. There was no demand of the debt when due, nor was there any notice of the sale, except a notice of a sale of a large and general assortment of boots and shoes, by the autioneer, published in a daily paper. The boots and shoes, worth $520:32, were sold at the auction for $166.97. The notice was published in the paper before the debt was due. It was held that the debt should have been demanded, and if not "paid, personal notice of the time and place of sale should have been given.

In Wilson v. Little (2 Comst., 443), railroad stock was pledged to secure the payment of a note presently due, with authority to sell the stock at the broker’s board, or at public auction or at private sale, at option, on the non-performance of the promise, without notice. The defendant sold the stock without demanding the debt or giving notice of the sale. It was held that he was bound to demand the debt before resorting to the sale. In the opinion it is said: In every contract of pledge there is a right of redemption on the part of the debtor; but in this case that right was illusory and of no value if the creditor could instantly, without demand of payment and without notice, sell the thing pledged. We are not required to give the transaction so unreasonable a construction. The borrower agreed that the lender might sell without notice, but not that he might sell without demand of payment, which is a different thing.”

In Wheeler v. Newbold (16 N. Y., 393), promissory notes were pledged, and it was held, in the absence of a special authority, that the pledgee had no right to sell this commercial paper, even after demand of payment of the debt and notice of the sale, but' that he was bound to hold and collect them, and apply the proceeds.

In Allen v. Dykers (3 Hill, 593; S. C., 7 Hill, 497), the promise was to pay money sixty days after date, and stocks were pledged as-collateral security, with authority to sell on the non-performance of the promise; the sale to be made at the board of brokers; notice waived, if not paid at maturity. The stock was sold by the pledgees before the loan became due, and I infer, though it does not so expressly appear, that the sale was private and secret. The Reporter’s syllabus of what Chancellor Walworth said as to the power to sell, is that “the contract did not give the right to sell the stock secretly at the board of brokers, in any event, but he was bound to put it up openly, and offer it to the highest bidder, stating that it was pledged to secure the note, with authority to sell.” I. have no objections to the remarks of the Chancellor, as indicating what should be done under such a power, in order to release a sale from any suspicion of unfairness or collusion. He cites no authority, and the remarks were quite unnecessary in the case, though, I think, well enough, under the general rule that the sale must be fair and open. They have no application to the present case, unless it be as an illustration of the construction put upon a power to sell at the board of brokers.

Wilson v. Little, 1 Sandf., 351, is the same case in 2 Comst. (supra). There is nothing in these cases in conflict with the view I have taken of the contract in this case. Considering the property, and the manner of selling such property, in connection with the authority to sell at private sale, or otherwise, in my opinion, a fair construction of the contract will exclude the necessity of giving notice of the precise time and place of sale.

It is also insisted that the defendant was bound to make a demand of payment of the margin personally of the pledgor; and that notice to redeem should have been given personally; and so as to the time and place of sale. No demand of the money loaned was made upon the borrower or his agent; and, in my opinion, this was not necessary in this case; The general rule is, that a demand of the debt must be made after it is due, before the pledgee can resort to his remedy by sale. In this case the money loaned was not due, and the parties had expressly agreed that, in case the stipulated margin should not be kept good “ whenever demanded,” then the authority to sell should arise. The demand to make the margin good was made, and this was all the demand that the pledgee had at the time a right to make. This demand was made upon Douglass, who as the jury have found, was the agent of Milliken in the transaction of the business, authorized to receive a notice of the kind. In my opinion this was a sufficent demand upon the general law of agency. If Douglass was the agent of Milliken in the transaction of the business, a demand made upon him was equivalent to a demand upon Milliken; and so, I think, as to a notice of sale in case any notice was necessary. I am aware that some of the judges speak of personal demands and notices. Thus, Judge Brown, in Wheeler v. Newbold (16 N. Y., 399), speaks of the duty of the pledgee to give .personal notice of the time and place of sale, citing 2 Story Eq., § 1008, where Story says, the pledgee may sell, “without any judicial sanction, after giving the proper notice of the intended sale, as prescribed by law to the debtor.” Chancellor Kent says, reasonable notice to the debtor to redeem (2 Comm., 583); and so says Parsons on Contracts (p. 601), as to notice of sale. It seems to me that a demand upon an authorized agent, or notice given to him is, in law, equivalent to a notice to the principal; and no reasons occur to me why such demand or notice should not bind the principal. It is not a proceeding by which a personal judgment is to be recovered. A different rule would often be very inconvenient.

There are some other exceptions, none of which were, in my opinion, well taken, and I think the case was properly tried, and that the defendant was entitled to judgment upon the verdict. The order granting a new trial should be reversed.

Denio, Ch. J., and Rosekrans, J„ took no part in the decision; all the other judges concurring,

Order reversed, and judgment absolute for defendant.


author: Emott, J. Seldest, J.,

text:
    The People, ex rel. Belden, v. The Contracting Board.
    ■Proposals for a contract, requiring as security the certificate of a bank that it holds a deposit of $4,000 “ in cash,” are satisfied by a certificate of the deposit of $4,000, without further specification.
    The law requiring the canal contracting board to award contracts for repairs to “ the lowest bidder who will give adequate security,” and it having made an award, a lower bidder who has given the security ■ required is not entitled to a mandamus.
    Though the practice of issuing a peremptory mandamus in the first instance is not to be commended, it is within the power of the court; and the objection, that an alternative writ should have first issued, is not available on error.
    This proceeding came up on appeal by the defendants from the order of the Supreme Court, at general term, in the third district, affirming an order of the special term, awarding a peremptory mandamus against the defendants, commanding them to forthwith proceed and award to the relator, and to enter into, a contract with him for the repairing and keeping in repair, in accordance with the rules and regulations of the contracting board, and with the terms of his proposal for such work, that portion of the canals of this state, and of the public works connected therewith, known as the Cayuga and Seneca canal.
    The affidavits upon which the order for the mandamus was made showed that on the 27th of May, 1862, the defendants, composing the contracting board of the state, in pursuance of the provisions of chapter 105 of the Laws of 1857, advertised for proposals to be received until the 27th day of June, at 1£ o’clock, p. M., for furnishing all the materials, and performing all the work necessary to put and keep in good repair, during four and a half years from the 1st day of July then next, the Cayuga and Seneca canal.
    Among'the provisions of the notice, were the following: “All proposals for the above described work, must be accompanied by a certificate of deposit in some banking institution in good credit, within this state, certifying that the sum of four thousand dollars in cash has been deposited in said institution, to the credit of NT. S. Benton, auditor.”
    “ NTo proposal will be considered, unless in strict conformity with this notice.”
    The notice required the proposals also to be accompanied by bonds for the performance of the work, with two or more sureties, which bonds were to be executed and authenticated, and the responsibility of the sureties attested, in a manner specially pointed out; and specifications and forms of the con tract were mentioned as ready for examination at the place ■ appointed for receiving the proposals.
    On the 27th of June, and before the expiration of the time . appointed for that purpose, the relator presented a proposal to do the work, which was accompanied by a certificate of-deposit, in the following words and figures:
    “ $4,000. Certificate of Deposit.

    “ STATE OR NEW YORK,
    “Salt Springs Bank of Syracuse,
    “ Syracuse, June 27<7i, 1862.
    “A. 0. Belden has deposited in this bank, four thousand dollars, payable to the order of N. S. Benton, auditor, on return of this certificate. T. W. Truesdell, Teller.”
    In all respects, othér than the form of the certificate, the proposal, and the papers which accompanied it, were in accordance with the terms of the notice. It was shown by the affidavits, both on the part of the plaintiffs and of the defendants, that the proposal of the relator was rejected on the ground that it did not appear, from the certificate of deposit produced by the relator, that the deposit was made in cash; and the contract was awarded to George M. Case, whose proposal for the work was the lowest which the board regarded as in accordance with the requirements of the printed notice, but not so low, by fifty dollars a year or more, as that of the relator.
    From the affidavits on the part of the defendants, it appeared that the deposit made by the relator, was made in a check of J. J. Belden for four thousand dollars, upon the same bank which issued the certificate of deposit; also, that on the 30th day of June, a contract was executed between the contracting board and Case, for said work and repairs to be done and performed by him. during four and a half years, from July 1st, 1862, of which contract duplicates were filed in the canal department, as required by law; that on the said 1st day of July, he commenced the work, pursuant to the contract, and was still in performance thereof.
    No alternative mandamus was issued, but the defendants having appeared and filed affidavits in answer to the affidavits on the part of the plaintiffs, and both parties having been heard, a peremptory mandamus was ordered in the first instance, at the special term. From an affirmance of that order, the defendants brought the present appeal.

      F. Kernan, for the appellants.

      L. Tremain, for the respondents.
   Emott, J.

The Constitution of this State (article 7, § 3), as amended in 1854, declares that “all contracts for work or materials on any canal shall be made with the person who shall offer to do .or provide the same at the lowest price, with adequate security for their performance.” The act of 1857 (vol. 1, p. 214) provides that the contracting board “ shall have power, and it shall be their duty to let by contract, under such regulations as said board shall prescribe, to the lowest bidder or bidders, who will give adequate security for the performance of the contract,” the repairs of any completed section of the canal. Under this law, the contracting board advertised for proposals to keep the Cayuga and Seneca canal in repair for four years and a half. This notice indicated the form and character of the. security, which the board would consider adequate, that is, it stated that every proposal must be accompanied by a certificate of deposit in some bank in good credit; that four thousand dollars in cash had been deposited therein to the credit of the auditor, which would be retained as security for the- performance of the contract. The relator made a proposal which was somewhat lower in price than that of any other person, but it was not accepted. A contract was made with one Case, who seems to have been the next highest bidder. The relator delivered with his proposal a certificate that he had deposited in the Salt Springs Bank of Syracuse four thousand dollars, payable to the order of IT. S. Benton, auditor, but the certificate did not state in so many words that he had deposited such amount in cash. Case, whose bid was accepted, delivered a similar certificate, containing, however, the words “ in cash." It is to be inferred, although it is not distinctly stated that this difference in the form or phraseology of the certificate was the reason assigned for rejecting the' relator’s bid, and accepting a higher one. I confess I should be unable to justify such a decision, and I can hardly suppose that it was the true and only ground of the action of the board.

Yet I think the Supreme Court ought not to have compelled the board, by mandamus, to reverse their action, or to make a contract with the relator, after they had already made another contract with another person. The powers conferred upon the board necessarily involved and implied an exercise of discretion, although it seems exceedingly clear what decision their duty required them to make in this case. But they are to determine who is the lowest bidder, and what is adequate security; or if the amount and character of the security required is fixed by general regulation, then the contracting board are to decide whether the security offered in any given case conforms to the regulations. The principle is well settled, that whenever the act requires the exercise of discretion, this remedy will not lie. There must be a clear legal right not merely to a decision in respect to the thing sought, but to the thing itself. (People, ex rel. Lynch, v. Mayor of New York, 25 Wend., 680, 686; 19 Johns., 259; Reeside v. Walker, 11 How. U. S., 272.) The right in the case before us seems exceedingly plain, but it is after all' only a right to a correct decision. The relator has no contract, no right to any specific act free from all discretion in the contracting board. If we may interfere here, we may do so whenever the contracting board decides incorrectly as to the respective amounts of proposals, or the character of securities.

If the case were clearer to my mind than it is, in favor of the jurisdiction to grant a mandamus, I should still feel bound to rpthhold it, and that, although the relator should have no other remedy, which I, by no means, admit. The writ of mandamus is to some extent, at least, in the discretion of the court to grant or refuse; especially where, as in this case, no property of the relator has been taken or affected, and his claims rests altogether upon the interests of the State to have its work done by the lowest bidder, and not upon a legal right on his part. (People v. Canal Board, 13 Barb., 450, and cases cited.) The only legal right of the relator in such a case, if he could have any, would be to damages for refusing him the contract. But it' appears in this case that the contracting board have made a contract with another person, one Case,already mentioned, and that he is engaged in the work. This individual would certainly be entitled to compensation for his work; and the only result of ordering a second contract for the same work, would be to subject the State to the payment of double compensation. I should not be inclined to issue a writ which would produce such a result, simply to correct a decision of these officers, even though flagrantly improper. There must, after all, be some discretion left to public officers, and a power to do wrong as well as right. The courts cannot correct all the evils incident to the administration of government under an elective system, especially where the judiciary itself is elective.

The judgment of the Supreme Court should be reversed, and judgment ordered for the defendants.

Denio, Ch. J., Davies, Wright, Balcom and Marvin, Js., were also for reversal—Denio, Ch. J., and Balcom, J., on the ground, among others, that the board, having executed a contract, could not execute another unless the first were absolately void; and they thought it good for the purpose of giving the relator his action against the members of the board.

Seldest, J.,

(dissenting.) The objections made by the appellants’ counsel to the order appealed from, are all embraced in the following propositions: 1. That; the certificate of deposit furnished by the relator was not such as the notice issued by the contracting board required. 2. That the question whether the certificate was in compliance with the notice was a judicial question which the board was required to decide; and, if its decision was erroneous, the error could not be corrected by mandamus. 8. That the contract with Case, who had no notice of the rights of the relator, was valid, and, as he is not a party to these proceedings, will remain valid notwithstanding the judgment; and that, under such circumstances, the power of the court should not be used to compel the execution of another contract for the same work. 4. That, if a mandamus was proper, there should have been an alternative writ, and not a peremptory writ in the first instance.

I think neither of these objections furnishes ground for reversing the judgment of the Supreme Court. Unless substance is to be disregarded, and importance attached to mere phraseology, the certificate of deposit furnished by the relator was in perfect accordance with the terms of the notice. The addition of the words, “in cash,” to the expression, “has deposited four thousand dollars,” would add nothing to the legal effect of the certificate. The obligation of the bank would be the same, with those words or without them. ■ In neither case could it discharge that obligation without paying to the holder of it four thousand dollars in cash. Neither is it material that the deposit was in fact made in a check, and not in cash. It is, doubtless, to be presumed that the check was drawn against a cash deposit to the credit of the drawer already in the bank; in which case, the check constituted a cash deposit. It is, however, unimportant whether that was so or not. The notice contemplated only a general deposit of cash to the credit of the auditor; and, in such a transaction, the cash deposited becomes the property of the bank, and all the right which is acquired by the person to whose use the deposit is made, is a credit against the bank to the amount of the deposit. (Chapman v. White, 2 Seld., 412.) It was, therefore, wholly immaterial whether the deposit was made in cash or credit, provided it was sufficient' to constitute a consideration for the certificate, and, perhaps, even that was immaterial. (16 N. Y., 125.) If the notice had required a special deposit of cash to the credit of the auditor, so that the right of property in the article deposited would have vested in him, and the obligation of the bank have been merely that of bailee, the case would have been different, and would probably have required a different determination.

There was nothing of a judicial character in the action of the board in reference to the certificate of deposit. There are many questions requiring the decision of ministerial officers, which involve, to some extent, the exercise of legal discrimination in their solution, but which are not regarded as judicial questions, and consequently the decision of them, is not conclusive in collateral proceedings. A sheriff is required, when process is placed in his hands for service, to decide whether it is in conformity with law; but it was never claimed that his decision was a judicial one, or that it concluded any party affected by the process; and yet such a case presents quite as much the character of a judicial proceeding, as that involved in the present inquiry. It is a general, if not universal rule, that judicial proceedings cannot regularly be had (beyond their mere initiation), without notice to those to be affected by them, and giving them an opportunity to be heard. The necessity of such notice is probably the true test, by which to determine whether a proceeding is a judicial one or not. There is no evidence that such notice was given in the present case, and I am satisfied that none was necessary.

The remaining question is, whether a mandamus was the proper remedy under the circumstances disclosed by the affidavits. The statute made it the duty of the contracting board to let the work “to the lowest bidder” (1857, ch. 105, § 1), and the relator was the lowest bidder. The absolute duty in this respect, which the statute imposed upon the contracting board, distinguishes this case from that of The People v. The Canal Board (13 Barb., 432), where it was held that the Canal Board could not be compelled by mandamus to enter into a contract on behalf of the State. There was nothing in the statute under which the claim was made in that case, requiring the work to be let to the lowest bidder. The language of the act was, “ contracts shall be awarded to such parties as shall propose to perform the work on terms most safe and advantageous to. the State, having due regard to price, the ability of the parties, and security offered for the performance thereof.” (Laws of 1851, ch. 485, § 12.) I do not see that the contracting board was authorized to exercise any discretion on the subject, in the present case, unless, perhaps, to reject all the bids and refuse to let the work at all. If, however, any bid was accepted, the board had authority to accept none but the lowest. The relator was, therefore, entitled to the contract; # • 7 , 7 and if it cannot be secured to him by mandamus, he is without remedy, or, at least, without adequate remedy. A partial remedy, if any such exists, furnishes no ground for refusing the writ. (1 Barb., 34; 24 N. Y., 120.) The case is thus brought within the rule, stated by Denio, J., in The People v. Mead (24 N. Y., 119), that the writ of mandamus is a proper remedy “ to compel executive and ministerial officers to perform official duties, where an individual has a private and pecuniary interest in such performance," and has no complete remedy by action. In the present case the rights of the public, as well as of the relator, ate involved, as the State is interested in having the provisions of the act, directing the letting of work to the lowest bidder, observed.

It is urged, on the part of the defendants, that there is already a valid contract with Case, for the performance of this work, and that the court, for that reason, should not compel by mandamus the execution of another contract for the same work. Whether the contract with Case is valid or not, is a question that cannot now be decided, as he is not a party to these proceedings, and has no opportunity to be heard. Assuming that it is, or may be, valid, it is obvious that inconvenience, and, to some extent, confusion, may result from a compliance with the mandamus, but it is not perceived how the probability of such inconvenience or confusion can affect the strict rights of the relator. It has been decided that, where an office is filled by a person, by color of right, a mandamus will not be issued to oust him and admit another ; and cases of this kind are referred to as authorities for holding that the writ should have been denied in 'this case. (3 Johns. Cases, 79; 2 id., 217-247, Shephard’s edition; 20. Barb., 302; 6 East, 356.) The reason on which those decisions rest is, that the proper remedy was by quo warranto, which shows that they are not applicable to the present case, in which no quo warranto would lie.

If the application for the mandamus was one of strict right, I can discover no ground upon which it could have been refused. The granting of the writ, however, is, to some extent, a matter of discretion (1 Cow., 502; 15 Barb., 608; 4 Hill, 582); and the peculiar circumstances of the case were proper for the consideration of the court below, in deciding whether it should be issued or not. But this court has often decided that it has no jurisdiction to control the exercise of discretion in the courts below, and the present case forms no exception to the rule.

It has been also insisted, that if a mandamus was proper, an alternative writ should have been first issued. It is within the power of the court to make the writ peremptory in the first instance ; and where the parties have been heard, and there is no controversy in regard to facts, I can see no objection to that course,' although the practice, except in very clear or very urgent cases, is hardly to be commended. (Topping, on Mandamus, 407; Crary’s Prac., 286; Regina v. Fox, 2 Ad. & Ellis N. S., 246; Ex parte Goodell, 14 Johns., 325; The People v. The Judges of Cayuga, 2 Johns. Cases, 68; The People v

Throop, 12 Wend., 183; Ex parte Rogers, 7 Cow., 526.). The judgment of the Supreme Court should bé affirmed.

Judgment reversed, and judgment for defendants.


author: Rosekrans, J. Wright, J.,

text:
    The People, ex rel. Whitlock, v. Benton, Auditor, &c.
    The words, “ collectors of tolls on the canals" (1 R S., p. 229, § 69), are merely descriptive of the officers and their business, and do not refer to their places of residence or the district in which their official business is to be conducted. The statute authorizes the appointment of a collector of canal tolls in the city of New York.
    Appeal from the Supreme Court, where a peremptory mandamus had been issued, requiring the defendant, as auditor of the canal department, to approve the official bond tendered by the relator as collector of canal tolls at the city of New York, and to do such other acts as might be necessary to enable the relator to exercise the duties of that office. The relator put his refusal to approve the bond on the ground that the canal board had no power, to appoint a collector of canal tolls to be located elsewhere than on the line of some of the State canals.

      John H. Reynolds, for the appellant.

      David Dudley Field, for the relator.
   Rosekrans, J.

The'statute gives the canal board “power to appoint so many superintendents of repairs, and collectors of tolls on the canals, as they may deem necessary.” (1 R. S., 5th ed., § 135.) The words, “ superintendents of repairs on the canals,” and “ collectors of tolls on the canals,” in this section, are merely descriptive of the officers and their business, and have no reference to their places of residence, or the districts in which the business of their respective offices shall be conducted. They mean nothing more than “ superintendents of canal repairs,” and “ collectors of canal tolls.” These officers are indifferently spoken of in the statutes by these names and those used in the section first above referred to. In the list of administrative officers, “ superintendents of canal repairs ” are mentioned. (1 R. S., 381.) In the statute providing for the mode of their appointment and the tenure of their office, they are called by the same name. (1 R. S., 405, § 9.) In the same statute (§ 10), the collectors are called “collectors of canal tolls.” In the statute which confers upon the canal board the power tq appoint these officers and to prescribe their number, and giving the power of removal, they are called “ superintendents of repairs on the canals,” and “ collectors of tolls on the canals." These different names are intended to apply to and designate the same officers. It is evident that by the section first cited, the legislature did not intend to define the place or district in which these officers should discharge the duties of their respective offices. There is a general statute, requiring every officer included in the class of administrative officers, to be confined, in the execution of the duties of his office, to the district, &c., for which he shall be appointed, except when otherwise provided by law. (1 R. S., 5th ed., 383, § 14.) The districts in which the officers referred to are to perform their duties, is not specified in the statute.

The designation of these districts is left to be regulated by the canal board. It was evidently contemplated that numerous districts would be necessary, and it was intended to confer upon the canal board unlimited discretionary power as to the number, extent and location of such districts. The nature of the duties of superintendents of repairs is such as to require that their districts should be a part of the canals; and it would be absurd to suppose that the canal board would appoint a superintendent of canal repairs over any other district than a portion of the canals. But courts will take judicial notice of the general character of the business of the country, and the mode in which it is conducted. We know that canal boats, laden with the products of the west, pass through our canals, into the Hudson river, and thence to Hew York, without breaking bulk, and that they take return cargoes at Hew York, to be transported, without breaking bulk, to greater or less distances upon our canals. The convenience of having a collector of canal tolls in the city of Hew York, to whom the tolls on such return cargoes can be paid, and by whom clearances can be given, can be readily seen. Such tolls could, at least, be as conveniently collected at the city of Hew York as at any place on the canals; and if a collector is appointed in the city of Hew York, and is- confined to that district in the performance of his duties, such appointment is clearly within the power conferred upon the canal board.

There are some sections of the statute which assign duties to, and impose restrictions upon, collectors of canal tolls whose offices are upon the line of the canals, which are not applicable to the collector in the city of Hew York. Such are the sections which make it the duty of every collector of tolls to assign berths to all boats when loading or "unloading at any landing place on a canal where disputes shall arise. (1 R. S., 5th ed., p. 427, § 272.) Another is the section which prohibits the payment of office rent of a collector except upon the certificate of the canal commissioner having charge of the division of the canals on which such collector is appointed and where such office is located. (Laws of 1859, ch. 495, § 4.) But these sections do not limit the power of the canal board to appoint a collector elsewhere than upon the line of the canals.

We entertain no doubt that the canal board, in maldng the appointment of the relator as collector of canal tolls at the city of Hew York, acted in accordance with, and within, the power conferred upon it by statute, and thaf the order appealed from should be affirmed, with costs.

Davies, Selden, Emott and Marvin, Js., concurred.

Wright, J.,

(dissenting.) The sole question involved is the power of the canal board to create the office and appoint a collector of canal tolls at .the city of Hew York. If the canal board appointed the relator a collector of canal tolls, to reside and keep, his office in the city of Mew York, without authority, it was the right and duty'of the auditor to refuse to recognize him as such officer, or to approve or file his official bond.

It is not claimed that the canal board can exercise any 'authority not given to it by statute; and it possesses no power except that which relates to the canals of the State, as they are described and designated by the legislature. (1 R. S., 5th ed., p. 578.) The power to appoint collectors of tolls is conferred in these words: “ They shall have power to appoint so many superintendents of repairs and collectors of tolls on the canals as they may deem necessary," &c. (1 R. S., 5th ed., p. 602, § 135.) The defendant insists that this is a grant of power to appoint collectors of tolls to be located and their duties performed on the canals, and within the territorial jurisdiction of the canal board, and not elsewhere. The language of the section is interpreted as an authority simply to appoint toll collectors on the canals of the State, as they are defined by law. On the other hand, it is insisted that the power is conferred to appoint collectors of tolls receivable for the use of the canals of the State without regard to the question whether the appointee is located on the canal where his duties, are to be discharged, or not.

I am of the opinion that the canal board derived no authority from this statute to locate a collector of canal tolls in the city of New York and designate the relator to fill such office. The city is not, in any sense, on any of the canals of the State. The duties and powers of the canal board are exclusively confined to the control and management of the .canals of the State, as the legislature have defined them. One of the powers conferred is, “ to appoint so many superintendents of repairs and collectors of tolls on the conals as they may deem necessary.” This is’ not a mere power to fill an office, but to create one, to be located at a place on the canals where tolls are and may be collected by law, and where their payment can be enforced. The legislature, in conferring the power to appoint superintendents of repairs and collectors "of tolls “on the canals," meant just what a fair interpretation of the language imports, that the offices and officers thus appointed were to be located and their duties performed, on the canals. Having regard to the nature of the duties to be performed, that would certainly be a strained construction of the law that imputes to the legislature an intention that the canal board should locate canal appointees all over the State and even beyond it; for if the . board may, in executing the power, locate a superintendent of repairs, or a collector of tolls, in the city of New York, one hundred and fifty miles distant from where their duties are to be performed, and wholly out of the territorial jurisdiction of such board, it may do so at Boston of Philadelphia.

We are not, in construing a statute, to place a meaning on the language employed that will lead to absurd consequences or impute to the legislature an absurd intention, when it may be avoided. The power to appoint superintendents of repairs of the canals is conferred in the same terms as the power to appoint collectors of tolls. If, then, the legislature intended to confer upon the canal board the power to appoint the latter class of officers, whose offices should be located, and their duties performed at New York, the same intention existed as to the former class. -But it would be absurd to urge a legislative intention to invest the canal board with the power to locate a superintendent of repairs in the city of New York, when no duties were to be performed. On the contrary, as repairs to canals must necessarily be done upon them, the fair presumption is that, in conferring the power to appoint superintendents of repairs on canals, it was intended that the office should be located, and the duties performed, in the only place where they were needed, or could possibly be done, viz., dn the lines of the canals, and within the territorial jurisdiction of the canal board. I presume no one will contend that, under the power conferred by the section of the statute cited, the canal board could appoint a superintendent of repairs of the canals for the city of New York. If not, the board could not appoint a collector at that place, the statute conferring any authority at all to appoint, being the same and it conferred in the same language, in respect' to both offices.

But, again. It is not to be assumed that the legislature intended to have a collector of tolls located where no tolls are legally payable. It is the actual use and navigation of the canals that entitles the State to demand and collect tolls; and no person intending to navigate any of the canals is bound to pay tolls for such navigation at a point remote from the canal and not within the jurisdiction of the canal board. He is not bound to pay tolls at the city of Hew York, one hnnhundred and fifty miles distant from the place where they are payable, and where payment can be enforced. It is, therefore, the more reasonable interpretation of the legislative meaning in the use of the words, “ shall have power to appoint so many collectors of tolls, on the canals, as may be necessary,” to hold it to be a grant of power to the canal board to locate so many collectors, and in such places on the lines of the canals, as such board, in its judgment, deem that the public interests, and the public works confided to its control and management, require.

There are various statutory provisions regulating the management of the canals, inconsistent with an intention by the legislature that canal offices and officers may be located distant from the line of the canals. The board of canal commissioners are to assign to each commissioner, for his special charge, a designated portion of the canals; and the commissioner so assigned to a particular division, has the power, and it is his duty to inquire into the official conduct of superintendents of repairs, collectors of tolls and other subordinates, and to enforce the faithful execution of all the duties imposed by law upon them. So also it is made the duty of every collector of tolls to assign berths to all boats, when loading or unloading at any landing on a canal, where disputes shall arise concerning the same. (1 R. S., 5th ed., 427, § 272.) It is also provided, that no rent of the office .of a collector can be paid or office rented, except upon the certificate of the canal eommis-' gioner having chargé of that portion of the canals where the office is located. (Laws of 1859, ch. 495, § 4.) These provisions, and all the laws pertaining to the management of the canals, are inconsistent with the location of a superintendent of repairs or collector at ,a place off from the lines of such canals. Under the jurisdiction of which canal commissioner is the collector of tolls in New York? Or on which of the different canals of the state is he a collector of tolls ? What canal of the state has a landing place at New York? How can the rent of the collector’s office in New York be paid or the office rented, the city being no portion of the canal, and not in the charge of any canal commissioner competent to make a certificate ? I imagine it would be difficult to solve these inquiries.

I am, therefore, of the opinion that the legislature has not yet invested the canal board with power to appoint a collector of tolls at New York. If the public-convenience is to be promoted by the location of such an office there, it is for the legislature, and not the canal board-, to authorize it. The order of .the Supreme Court should be reversed.

Denio, Ch. J., and Balcom, J., were also for reversal.

Judgment affirmed.


author: Emott, J.

text:
    In the matter of The Hollister Bank of Buffalo.
    The act to enforce the liability of stockholders in banking corporations (ch. 226 of 1849) subjects each stockholder to a several liability for a ratable share of the debts in proportion to the whole capital stock and the whole indebtedness of the bank, without reference to the solvency of any other stockholder.
    When one assessment has been made upon the stockholders for their respective shares of the liabilities of the bank, and has been confirmed, and it remains in force, no second assessment can be made to supply a deficiency resulting from the .inability to collect the sums assessed on insolvent stockholders.
    Appeal from the Silpreme Court. On the 2d day of September, 1857, the Hollister Bank was declared insolvent, and a receiver appointed. The receiver procéeded to close up the affairs of the bank, and on the 1st of July and 1st of September, 1858, he made dividends of all the cash in his hands among the creditors according to law. This dividend left $164,038.62 of the debts of the bank, contracted since January 1, 1850, still unpaid. On the 29th September, 1858, the receiver rendered to a justice of the Supreme Court, an account of the debts unpaid, and of his proceedings, with a list of the stockholders, as required by the act of 1849. A reference was ordered according to this act, and an apportionment made upon all the stockholders, of the debts of the said bank, which was confirmed, and entered and docketed as a judgment.
    On the 8th September, 1862, the receiver presented another petition to a justice of the Supreme Court, reciting the former proceedings, and stating that certain of the parties assessed by the former apportionment had not paid, and the amounts payable by them were not collectible; that a debt in litigation against The Hollister Bank at the time of the former apportionment, had been established and increased the aggregate debt of the bank, and giving an account of the moneys and property which had come to the receiver’s hands, including -the proceeds of the former assessment. It appeared by this petition, that the debts still remaining unpaid amounted to $93,149.89. ' ■
    On the petition, a second reference was ordered and had, and a second apportionment was made upon the stockholders to the full amount of this debt, which was confirmed by the Supreme Court at special term. Certain stockholders or their personal representatives appealed; the order was affirmed at general term, and they appealed to this court. '

      Chauncey Tucker, for the appellants.

      John Ganson, for the respondent.
   Emott, J.

Section 7 of article 8 of the Constitution of this State declares that “the stockholders in every corporation and joint stock association for banking purposes, issuing bank notes or any kind of paper credits to circulate as money, after the first day of January, 1850, shall be individually responsible to the amount of their respective share or shares of stock in any such corporation or association, for all its debts ai d liabilities of every kind, contracted after the said first day of, January, 1850.” I do not doubt that it was or would be competent, under this clause of the Constitution, for the legislature to provide for the enforcement, by action or otherwise, of a responsibility by every stockholder of any such corporation or association issuing bank notes, not merely for a ratable proportion, but for the full amount of any debt of the association contracted since January 1st, 1850, to the extent of his stock. Whether, however, the constitutional provision of itself creates a liability upon which an action might have been maintained against any or all the stockholders of such an association, if the legislature had passed no act to carry out that provision, or whether such liability exists, notwithstanding or independent of the act passed to enforce the responsibility of stockholders in these associations, are questions with which we are not at present concerned. The legislature, on the 5th of April, 1849, passed an act to enforce the responsibility of stockholders in certain banking corporations and associations, as prescribed by the Constitution. The proceedings now brought before us were taken under this act, and the only question raised by this appeal is, whether they are conformable to it, or authorized by it. This question is to be decided mainly upon consideration of the statute itself. The provision in the Constitution will, no doubt, show what its framers designed that the legislature should accomplish; but that design, however manifest, cannot be invoked to supply obvious deficiencies in the statute.

The first section of the act of April 5th, 1849 (Laws of 1849, p. 840, ch. 226), is as follows: “ Whenever default shall be made in the payment of any debt or liability contracted after the 1st day of January, 1850, by any corporation or joint stock association for banking purposes, issuing bank notes or any kind of paper credits to circulate' as money, after the first day of January, 1850, the stockholders of such corporation or association shall be individually responsible equally and ratably, such responsibility to be enforced', as hereafter provided, and in no other manner, for the amount of such debt or liability, with interest, to the extent of their respective shares of stock in any such corporation or association, as 'hereinafter provided.” Subsequent sections of the act provide for the appointment of a receiver, in case of the insolvency of any banking corporation: for the conversion of its assets into cash: for the payment, in the first place, if necessary, of 'the bills or billholders; and for a dividend of the surplus, if any, first among the creditors holding debts founded on any liability contracted after the 1st of January, 1850, and if any further surplus refnains, then among all other creditors.

The 14th section provides that if, after the declaration of the first dividend, there shall remain unsatisfied any debts of such corporation or association, contracted since. January 1st, 1850, the receiver, without waiti ng for payment of such dividend, shall render to a justice of the Supreme Court an account of such debts, and of all his proceedings, together with a list of the stockholders. The matter is then to be referred to a referee, who, after notice to the parties, is to “ apportion the debts of such corporation, contracted after January 1st, 1850, and remaining unsatisfied, among the said stockholders ratably in proportion to their stock,” according to the principles of the act, and to make a report to the court. This report is to be examined by the court. It may be modified, or' amendéd,. or referred back. After the report is confirmed, it is to be filed in the office of a county clerk, with the order of confirmation, and such order is to be a judgment against each stockholder for the amount assessed, chargeable to him. Provision is made for appeals from' orders in such proceédings, and for a new apportionment in case it becomes necessary' by reason of the determination upon any such appeal. The money collected upon an apportionment or assessment is to be divided among the creditors, and if any surplus remains after paying the debts, it is to be paid to the stockholders who were assessed, in proportion to the amounts levied upon them.

The act contains a complete and well digested system for one assessment, without any provision for a second. The contingency of the failure, or inability of a portion of the stockholders to respond to the assessment, although it could hardly have escaped the consideration of the legislature, is not provided for in any way. The apportionment of the debts among the stockholders is directed to be made ratably in proportion to their stock, and a new apportionment or assessment, if made under the direction of the statute, is to correct errors in the first, and not to supply a deficiency in its results.

The general manufacturing law of 1811 (1 R. L., 247, § 7), contained a provision to the effect that, for all debts which should be due and owing by any company formed under the act at the time of its dissolution, “ the persons then composing such company shall be individually responsible to the extent of their respective shares of stock in said company, and no farther.” This provision has been before the Supreme Court and the Court of Errors in a number of cases. It was held to impose upon the «stockholders o such corporation a several and not joint liability, limited only by the amount of-their stock. In Slee v. Bloom (19 John., 456), and Briggs v. Penniman (8 Cow., 387), the jurisdiction of courts of equity in such cases was asserted .to entertain suits by one or more creditors against all the stockholders, to compel them first to pay up their stock, and next to pay an amount equal to their stock, if necessary, to satisfy the prosecuting creditors. Again, in The Bank of Poughkeepsie v. Ibbotson (24 Wend., 473), an action was sustained at law, brought by one- creditor against a single stockholder, to recover his own debt against the defendant, who held stock to an amount more than equal to the debt.

These cases show that the liability of every stockholder in corporations, under the manufacturing act of 1811, was unqualified by the fact that there were other stockholders, or by their liability to assessment or contribution. If a stockholder had not paid or assumed debts of the corporation to an amount equal to his stock, any creditor could compel payment to that amount, for his own benefit. If either creditors or stockholders brought all the parties into a single action, with the view to an account, both of the debts and those liable to pay them, yet this would not have resulted in a pro rata apportionment of the liability, but only in the allowance to every stockholder of the amounts which he had paid or advanced for the company, himself, and the amounts which could be collected from others. (See Garrison v. Howe, 17 N. Y., 458, where similar reasoning is applied to the liability which is incurred in certain cases under the present general manufacturing law.) The language of the act of 1811, in this respect, is similar to that employed by the act of 1849, now under consideration, except that the latter contains two important qualifications, to be presently noticed. But in the case of the act of 1849, relative to banking corporations, as in the manufacturing act of 1811, the liability of the stockholders to creditors is not a joint, but a several liability. Each stockholder is subject, for himself, to a liability measured and determined by the provisions of the statute, without reference to the case or the responsibility of any other stockholder. Under the manufacturing law of 1811 the only limit to this liability was the amount of the stock of the company, held by the shareholder. Up to that limit, he was severally liable, and could be compelled to pay the debt of any creditor. The act of April 5th, 1849, contains, however, as I have said, two important limitations or qualifications upon the clause creating the liability of stockholders. The stockholders are declared to be responsible for every debt contracted since January 1st, 1850, equally and ratably. As the responsibility of each stockholder is several, the effect of this language is to make, each liable for his equal ratable proper • tion of the debt. The effect of the act may be seen by supposing that all the stockholders of this bank had signed a bond or undertaking to any or all the creditors, by which they severally agreed to be responsible, equally and ratably, in proportion to the amount of their stock, for the debts due by the association to such creditors. It is, I think, sufficiently plain that such an obligation or agreement would impose upon each of the parties to it a responsibility for a proportionate share of the debts. That this rate or proportion has reference to the amount of stock held by each, as compared with the whole stock and the debts, appear from the 16th section of the act. This section directs that the referee to be appointed by the Supreme Court shall apportion the debts of the corporation contracted after January 1st, 1850, and remaining unpaid, among the stockholders, “ ratably in proportion to their stock, according to the principles in this act declared.” By the 18th section, the referee is directed to ascertain the persons who are chargeable as stockholders, and the amount chargeable to each, according to the rules and principles declared in this act.

This apportionment of liability by the referee, upon the principle of proportion to the stock, when confirmed by the court, becomes the judgment, declaring and enforcing the liability created by the act. There is but one such apportionment and consequent judgment against each stockholder provided for, and but one contemplated by the act. Besides, the clause which has just been adverted to, the responsibility created by this act, is qualified by the provision, which is also contained in the first section, that such responsibility is to be enforced as thereinafter provided and not otherwise, that is only in and by the special proceeding given and regulated by the act. Suits by individual creditors against a single stockholder, such as were sustained under the manufacturing law of 1811, in the case of the Bank of Poughkeepsie v. Ibbotson, are intended to be cut off by this clause; and the only mode of establishing and enforcing the responsibility of stockholders in these associations is by this special proceeding to which they must all be parties, and in which an account of each with the corporation, for payments made ór debts assumed, as well as an account of the ratable portion of stock held by each, is to be taken, and judgment given accordingly once for all. As I have already said, this proceeding is complete as well as final. The act contains no authority for a second assessment or a second application, and I discover no provisions in the law from which it could be inferred that any such subsequent assessment to make good deficiencies in the collection of the first, was contemplated by the framers of the act. The act provides how a new apportionment is to be made, in case the first apportionment is reversed or so modified as to make it necessary (§ 29), and this express provision is entitled to some weight, as an exclusion of authority to make a second apportionment, while the first remains in force, neither reversed nor modified.

Upon the whole, I am of opinion that the liability imposed by this statute upon the stockholders of banking associations, is a several liability for a ratable and equal share of the debts, in proportion to the whole debts and the whole capital stock, and not a liability to each creditor until he "is paid, limited only by the amount of stock held by the stockholder, and that the statute gives no authority or jurisdiction to make more than one judgment, the first apportionment and judgment remaining unreversed.

I am, therefore, of opinion that the order appealed from should be reversed with costs.

All the judges concurring.

Order reversed.