source: Caselaw Access Project

author:
Mullin, J. Denio, Ch. J.
     Ingraham, J. Selden, J.

license: Public Domain

text:
    William Potter, receiver of the Medina Bank, v. The Merchants’ Bank of Albany.
    The cashier of a bank has the power to transmit a promissory note to another bank, for discount and collection, and to transfer the title thereto to the latter bank.
    But a mere clerk, acting as cashier in the absence of that officer, has no authority to transfer any of the notes or securities of the bank, unless such authority has been given him by the directors.
    The cashier can not clothe sqch clerk with any more of his power than is necessary to enable the latter to carry on the usual and ordinary business of the bank.
    A clerk thus intrusted has power to transmit notes owned by the bank, or held by it for collection and payable in other places, or at other banks, to its agents, for that purpose; to indorse such paper for the bank, when necessary; and to vest in the collecting agents such title as is necessary and proper to accomplish that object. But he has no power to transfer any other or higher title thereto, -and the agents will not, as against the bank, acquire any lien on the notes for any balance due from the bank.
    The demand of a note sent to a bank, as agent, for collection, terminates the agency, and a refusal to return it will be evidence of a conversion.
    The pendency of the action in which an order appointing a receiver was made may be proved by the recitals in the order.
    Jurisdiction may be established, prima fcuMt by recitals in the record.
    The Supreme Court, being a court of general jurisdiction, has by statute jurisdiction to appoint receivers in cases of insolvent corporations. And when an order is made appointing such an officer, the presumption is that all things were done required by the statute to be done, in order to authorize it to make such order.

      In an action for the conversion of a promissory note, it is proper to instruct-the jury that prima facie the damages which the plaintiff is entitled to recover are the amount which the maker of the note agreed to pay, and interest thereon.
    It is competent for the defendant, in such an action, to prove the insolvency of the maker, and thereby lessen the damages; but in the absence of any evidence of a want of ability to pay, the presumption is that he is solvent, and able to pay the note.
    The proper question to put to a'witness, in order to arrive at the measure of damages, in such an action, is, “ are the parties to the note solvent, and able to pay their debts'?”
    Appeal from a judgment of the Supreme "Court in the 8th district. The action was brought by the plaintiff as receiver of the Medina Bank, a banking association duly organized and doing business at Medina, in the county of Orleans, to recover damages for the conversion of a promissory note, owned by the bank, made by John R. Weld, for the sum of $3000, to the order of Reuben S. Castle, payable ninety days from date at the Metropolitan Bank, Eew York; and the same was indorsed by said Castle. The note was dated the 16th of May,-1861. The facts proved, so far as they are necessary to an understanding of the case, are as follows: For some ten years prior to the 1st of June, 1861, the defendant had been the collecting agent for the Medina Bank, to which notes belonging to said bank were sent for collection, and the same were credited to the bank on the defendant’s books, and the Medina Bank drew upon the defendant from time to time, and the said drafts were charged to the Medina Bank.
    On the 3d of June, 1861, Timothy Baker, jum was president, John M. Kennan cashier, and C. J. Beach clerk, of the Medina Bank. On that day said Beach, in the absence of ■ the-president and cashier, and while in charge of the bank pursuant to the directions of the cashier, but without authority from either the president or cashier so to do, inclosed said note to the defendant and directed it to be placed to the credit of the Medina Bank. Before being forwarded, one Brown, who had been president of said bank, wrote over the indorser’s name the words, “pay to the Merchants’ Bank, or order.” ■ The said note was received by the defendant, but the cashier refused to enter the note for discount, but did enter it for collection, and wrote to the Medina Bank on the 5th of June, informing it that the note had been received but was not indorsed by the bank, which was complained of as a strange proceeding, and demanding, as it would seem, authority from the bank to treat the note as the property of the bank. No authority was ever given. Notes not indorsed by the Medina Bank had been sent to the defendant, but very seldom. On the 4th of June the Bank of Medina stopped paying deposits, and on the 8th stopped paying its bills,. On the 10th of June the plaintiff was appointed receiver. Before the commencement of this action the plaintiff demanded said note of the defendant, and the same was refused, on the ground that the Bank of Medina was indebted to the defendant, and that the defendant had a lien on the note for a balance of account due from the said Medina Bank to the defendant.
    Evidence was given, on the trial, tending to show that at the time when the said Beach sent the note to the defendant, Brown, who filled up the indorsement on said note, had some interest in it, and that he had -requested the cashier to forward the same to the defendant, who refused; and that the note was sent by Beach at his (Brown’s) request. There was a verdict for the plaintiff for the amount of the note and interest. Judgment was then suspended, and the motion for a new trial directed to be heard in the first instance at the general term, and judgment to be there given. The general term denied the motion for a new trial, and ordered judgment for the plaintiff on the verdict.

      Learned & Cook, for the appellant.
    I. It is important to observe that this action is not brought on the ground of a transfer by the Medina Bank, alleged to be illegal, on account of insolvency. If such had been the ground, the action would have been in equity, to set aside the transfer; not in trover, to recover the value of the property. Ho such issue as this was made in the pleadings, or tried.at the circuit. But the action is such that (if maintainable at all) it might have been maintained by the Medina Bank, entirely solvent.
    II. The judge erred in refusing to nonsuit the plaintiff. In order to show the plaintiff’s title, it was necessary to show the pendency of the action in which he was alleged to have been appointed. Ho evidence was given under the allegations of fol. 6 of the complaint; but only under those of fol. 5; and these were put in issue. The power of the court to appoint a receiver of a corporation is statutory. (2 R. S. 464, m. p.; Attorney General v. Utica Ins. Co., 2 John. Ch. 371; Verplanck v. Mercantile In. Co., 1 Edw. 84; Ferris v. Strong, 3 id. 127; Bangs v. McIntosh, 23 Barb. 598.) Unless an action were pending, and such an action that a receiver might be therein appointed,- the order has no validity. The order is not a record. The courts can- not regard any proceeding as a matter of record, until it is enrolled. (Croswell v. Byrnes, 9 John. 287; McKnight v. Dunlop, 4 Barb. 36.) The recitals in the order are not a necessary part of the same, and have therefore no validity as evidence. Becitals in a surrogate’s order showing jurisdiction prove nothing. (Sibley v. Waffle, 16 N. Y. R. 180.) To prove a judgment a judgment record must be shown, and not simply an order for' judgment. The plaintiff alleged the commencement of the suit. This was a material fact which should have been proved. (Gillet v. Fairchild, 4 Denio, 80.)
    III. The judge erred in refusing to admit in evidence the testimony of the‘witness, 1st, as to the value of the note; and 2d, as to the responsibility of the maker of the note. 1. It would have been proper for the witness to state what, in his opinion, the note was worth. The question, though in form asking for an opinion, really asks for a fact. It would certainly be proper to ask how high a certain tree was; how far apart two persons were at a certain time; how large a certain piece of ground was; how heavy a certain package was, and the like. Tet the answers to such questions (except in cases of actual measurement) must be, in one sense, opinions; but they are not opinions in the sense in which the law excludes them. These are questions in which the witness is asked for measurements of height, weight, &c. In like manner he may be asked to measure the value of any piece of property. See the cases thoroughly examined in Clark v. Baird, (9 N. Y. Rep. 183, 186, &c.) The rule is universal, without any exception as to species of property. (Van Deusen v. Young, 29 Barb. 9, 29.) In this state alone it has been applied to the cases of services, (Lewis v. Trickey, 20 Barb. 387;) of a stove, (Smith v. Hill, 22 id. 656;) of a cow, (Joy v. Hopkins, 5 Denio, 84;) of a horse, (Rogers v. Ackerman, 22 Barb. 134;) of fruit trees, (Whitbeck v. New York Central R. R., 36 id. 644;) of a literary production, (Babcock v. Raymond, 2 Hilt. 61;) and of land, (Clark v. Baird, supra.) -Nor is there any reason why the case of a note should be an exception. “A whole volume of descriptive testimony would not be so likely to guide a jury to a. true estimate as the testimony of a single witness .speaking his judgment as to the value/ (Clark v. Baird, supra.) It can not be doubted that it would be proper to prove by the opinion of a competent witness the value of a rail road bond; even though it were a bond never quoted in the market. It would be impossible to prove all the numerous facts that go to fix that value. Indeed all that might be proved, for example, the prosperity of the road, the integrity of its officers, and the like, would not inform a jury what was the value of the bond. But a rail road bond is only a chose in action, like this note. -2. It would have been also proper for the witness to give his opinion of Castle’s pecuniary responsibility. It would be impossible to prove responsibility, or the want of it, by showing in detail the property which the person owned and the debts which he owed. A man is- often known to be responsible by numerous persons who could not specify a single item of his property. Evidence was admitted in this case on behalf of the plaintiff of this very same kind.
    IV. His honor the judge erred in refusing to charge as requested by propositions 9 and 10, and also in charging that the presumption of law was that the note was worth its face-. •1. Presumptions are the result of a general experience of a connection between certain facts or things. (1 Green. Ev., § 33.) The question is, then, when a note is past due and protested, does general experience show that it will probably be paid ? Before the note is yet payable, the presumption is that it will be paid; because experience shows that, in the great majority of cases, men will perform their contracts. But when the note is past due, that presumption is. taken away by the positive fact that the contract has been broken. A new presumption now arises directly from the former, viz. that ;(as -men generally perform their contracts, unless there be a good reason to the contrary,) there must be, in this case, either a defense to the note, or an inability to pay it. 2. Every one knows that in fact á note past' due, is not worth in the market nor can it be sold for its face. The presumption is that it will not be paid; especially when payable at bank. Suppose it nearly outlawed. 3. A failure to meet paper, payable at a bank, is a suspension of payment, and prima facie evidence of insolvency. (Brown v. Montgomery, 20 N. Y. Rep, 287; Johnson v. Bloodgood, 1 John. Cases, 55.) His honor the judge erred in refusing so to charge, and in charging that the presumption was that the parties were responsible. The slightest examination of the testimony will show that the verdict of the jury was greatly increased by this charge.
    V. His honor the judge erred in refusing to charge that the teller had authority to send the note, and in charging that the note was sent without authority. 1. The teller- kept the "books; had the combination of the safe; was left in charge by the cashier, and conducted all .the business of the bank, and as teller he sent the note. A part óf the business of the bank was sending notes to the defendant. 2. A third person can not be affected by any private instructions to an agent. The principal is liable for acts done within the general scope of the agent’s authority. (Munn v. Comm. Comp., 15 John. 44; Tradesman’s Bank v. Astor, 11 Wend. 87; Story on Agency, § 443.) 3. Suppose that the cashier, Kennan, contrary to the directions of the directors, had sent the note, it can not be doubted that this would have been a valid transaction as against the bank. Mow, in the absence of the cashier, the duties all devolved on Beach; and the plaintiff can not insist that, in the performance of these duties, Beach violated his orders. (Farmers’ Bank v. Butchers’ Bank, 16 N. Y. Bep. 125.)
    YI. His honor the judge erred in refusing to charge that the act of the teller was ratified, as requested. The Medina Bank was the principal, and Beach the agent. The note was sent June 3. The bank was notified of the fact June 6, by the defendant, and was asked to write. The bank never objected to the sending of the note. When the principal, being informed of the act of the agent, does not object within" a reasonable time, he adopts and ratifies the act. (2 Kent’s Com. 616; Story on Agency, § 258; New Hope Bridge v. Phœnix Bank, 3 Comst. 156, 166; Armstrong v. Gilchrist, 2 John. Cas. 423; Benedict v. Smith, 10 Paige, 126; Johnson v. Jones, 4 Barb. 369.) And this principle applies, although the agent has disobeyed his instructions. (Cairnes v. Bleecker, 12 John. 300.) Mor is any consideration necessary for such ratification. (Comm. Bank v. Warren, 15 N. Y. Rep. 577.) So the receipt of the overdue notes is a ratification of the whole transaction. A ratification of part is a confirmation of the whole. (Farmers’ Loan Co. v. Walworth, 1 Comst. 433.)
    VII. His honor the judge erred in charging that the defendant was not a bona fide holder, and in refusing to charge the contrary. 1. The question arises between the defendant and the Medina Bank; not between the defendant and creditors of the Medina Bank. (See Point I.) dSTo parting with value is therefore necessary to make a bona fide holder. 2. Receiving for collection was a good consideration, and made the defendant a bona fide holder. (Allen v. Merch. Bank, 22 Wend. 215; Mont. Co. Bank v. Albany City Bank, 3 Seld. 459; Comm. Bank v. Union Bank, 1 Kern. 203.) 3. This note was received and, entered for collection, according to previous custom.
    VIII. The defendant had a lien on the note for the balance of account. 1. The note went directly from the possession of the Medina Bank to the possession of the defendant. It was sent by the person having at the time the actual and legal custody and control thereof. 2. A banker has a lien on all paper securities which come into his hands, for his general balance against a customer. ’ (2 Kent’s Com. 641; Davis v. Bowshee, 5 D. & E. 488; Jourdaine v. Lefevre, 1 Esp. Rep. 66; Brandas v. Barnett, 12 Clark & Fin. 787; Grant on Banking, [12 Law Lib.] 283, 284, 288.) 3. It would be fatal to all banking business, if a customer could deprive the banker of this lien by proof that the remittance of the security had been made without express authority, or even contrary to directions, by a clerk intrusted with the transaction of such business.

      S. E. Church, for the respondent.
   Mullin, J.

The Bank of Medina owned the note in question, and in order that the defendant may retain it from its lawful owner, it must appear that the defendant obtained ' it bona fide before maturity, in the regular course of business, and for value paid, or that said note was transferred to it by the Bank of Medina, with the intention of transferring to the defendant the title thereto.

It is not pretended that the defendant has paid value for the note, or -that it is entitled to be considered as the bona fide holder of commercial paper.

All questions, therefore, as to the presumed or implied authority of the officers of the Bank of Medina, which usually arise between banks and the bona fide holders of securities of the bank for holders, and which such officers have transr fei’red or created in violation of their duty to the bank, are out of this case. And the inquiry is as to the actual power which the officer had in this case to transfer to the defendant this note, and thereby pledge the same as security for the debt of the bank.

The indorsement to the defendant was made by Brown, who was not at the time an officer of the bank, and although he had been, yet the defendant’s cashier knew he was an officer no longer. So far then as the handwriting in which the indorsement was made could affect the question, the defend-, ant knew it was not indorsed by any of the then officers of the bank.

The note was transmitted by Beach, who was a mere clerk, in the absence of the cashier of the bank. He was at the time of the transmission of the note acting as cashier, and clothed for the time with the powers of that officer, so far forth as the business of the bank demanded the services of that officer. Stoby, J. in Wilde v. The Passamaquody Bank, (3 Monroe, 505,) discusses the power of the cashier as follows: The cashier of a bank is, virtute officii, generally intrusted with the notes, securities and other funds of the bank, and is held out to the world by the bank as its general agent in the negotiation, management and disposal of them. Prima facie, then, he must be deemed to have authority to transfer and indorse negotiable securities held by the bank for its use and in its behalf. Ho special authority for this purpose need be proved. If any bank chooses to depart from this general course of business, it is certainly at liberty to do so, but in such case it is incumbent on the bank to show that it has interposed a restriction, and that such restriction is known to them with whom it is in the habit of doing business.” It can not be doubted but that the cashier had the power to transmit the note in question to the defendant for discount and collection, and to transfer the title thereto to the defendant. This would have been within the general scope of his authority as defined by Justice Stoby, and in accordance with the practice of the bank for two years.

But although such was the power of the cashier, it does not follow that' Beach while acting for the cashier had the same power. Beach as clerk had no authority to transfer any of the notes or securities of the bank. The directors had conferred on him no such power, and the cashier could not clothe him with any more of his power than was necessary to enable the latter to carry on the usual and ordinary business of the bank. Beach, in the absence of the cashier, had authority, undoubtedly, to pay checks, receive payment of notes and surrender them to the persons entitled, and, in a word, to do whatever was necessary and proper to be done in the ordinary course of business,.

I do not doubt but that Beach had power to transmit notes owned by the bank, or held by it for collection, and payable in other places, or at other banks, to its agents for that purpose, and as, in order to do so, it becomes necessary to indorse the paper for the bank, he had power to make such indorsement. But he had no power to pledge its securities, unless they become pledged by the mere act of transmitting for collection.

It seems to me that Beach had the power to send forward this note for collection, and that the defendant legally acquired possession of it for that purpose.

The cashier had refused to send forward this note to the defendant. Whether Beach knew of this refusal does not appear, and we must assume that he did not. This refusal by the cashier shows that it was not the intention of the bank to transfer the note to the defendant, and Beach’s authority was therefore limited to the making of such .transfer of the-note as the interests of the bank required to be made. He could transmit it for collection, but could not otherwise transfer or dispose of it.

It is said that the defendant received the note in the usual course of business without notice of any want of authority on the part of the officer transmitting it to transfer it, and that they must be considered bona fide holders for value. I have already said that the defendant is not a bona fide holder for value, and it must rest its defense on the right acquired, if any, by possession of a note acquired through an officer of the bank in the same manner in which for two years past it had acquired title to notes from the Bank of Medina. But it was competent for the Bank of Medina at any time to cease to transmit to the defendant paper for discount or collection, and when it did so, the defendant could not legally acquire any title to or interest in the notes of that bank, unless through third persons.

The Bank of Medina did not transmit this note; nor did it assent to any transfer of it to the defendant. The act of Beach was wholly without authority and in favor of the bank if it was intended to do more than transmit the note for collection.

Again, the defendant must have known that the act of Beach, so far as it was claimed to amount to.a pledge of the note, "Was unauthorized. Although notes had been sent to the defendant indorsed as this one was, yet it was so seldom done that the cashier could recall no instance of the kind, and knowing that mere possession of the note thus indorsed might not enable the defendant to hold it as against the bank, application was made for the indorsement of the bank, or evidence of a transfer by it to the defendant. This request was never complied with. The Bank of Medina, therefore, never'authorized the transfer to the defendant, nor ratified it. It is true the bank did not repudiate the act of Beach. But it was not called on to do so, and its silence has not in any manner prejudiced .the defendant.

I am of the opinion, therefore, that Beach had the power to transmit the note to the defendant for collection, and to vest in it such title as was necessary and proper to enable it to accomplish that object, but he did not have power to transfer any other or higher title thereto; and that the defendant did not, as against the plaintiff, acquire any lien on said note for any balance due from the Bank of Medina.

If I am right on this proposition, it becomes unnecessary to discuss the question whether a bank acquires a lien on the securities in its possession belonging to a customer, for any balance which may be due to it on account.

The defendant, after it acquired possession of the note, held it as the agent of the Bank of Medina for the purposes of collection, and as the demand was made before maturity, of the note there is no ground for claiming that a title to it passed to the defendant. The demand terminated the agency, and the refusal was evidence of a conversion.

I do not deem it necessary to inquire what effect, if any, the pending insolvency of the bank had on the right of the officers of the Bank of Medina to transfer this note to the defendant, to apply on the balance due from it to the defendant, if there was an intention to transfer it; because there is no finding in the case whether, at the time of the transfer, insolvency was contemplated or even conjectured.

After the plaintiff closed his evidence the defendant moved for a nonsuit, on the grounds: 1st. That the pendency of an action in favor of Horton against the .Medina Bank, in which the order for the appointment of a receiver purported to be made, was not proved; and 2d. That there was no evidence of the value of the note.

The only evidence in relation to the appointment of the receiver was a copy of the order of appointment, and the giving of a bond in conformity thereto. The pendency of the action was not proved, except by recital in the order, and the objection is that a fact material to jurisdiction can not, in a case like this, be proved by recital in an order or record, but must be proved aliunde. It is urged that the power to appoint receivers in cases of insolvent corporations is given by statute, and the mode of procuring the appointment is fully and particularly prescribed; and although the Supreme Court is one of general jurisdiction, yet in the exercise of powers thus specifically conferred there is no presumption of jurisdiction in its favor; and in such cases it stands on the same footing with an inferior court. But it was held by this court in Bangs v. Duckinfield, (18 N. Y. Rep. 592,) that the Supreme Court in the appointment of a receiver, under § 36 (2 R. S. 463) of proceedings against corporations in equity, is a court of general jurisdiction, and not as exercising a special statutory power. The question then is, could the pendency of the action in which the order appointing the receiver was made be proved by the recitals in the order ? It can not be denied that the pendency of the action, after personal service of the summons and complaint, and the appearance by the corporation on‘the motion, are fully recited.

There is a great diversity of opinion on the question; nevertheless I apprehend the weight of authority is in favor of the doctrine that jurisdiction may be established prima facie by recitals in the record. In 2 Cowen & Hill’s Notes, 1016, the authors say: In New York we may safely consider these jurisdictional recitals as prima facie evidence; and they cite in support of the proposition Barber v. Winslow, (12 Wend. 102,) in which Justice Nelson, delivering the opinion of the Supreme Court, adopts the ruling in Jenhs v. Stebbins, (11 John. 224.) These were cases of insolvents’ discharges, and the recitals were in the record of an inferior jurisdiction. If recitals are evidence of the performance of acts necessary to be done to confer jurisdiction in one court, and for one purpose, they must be for all. There can not be one rule of evidence for the superior and another for inferior courts. In addition to the cases cited supra from our own reports, the following cases may be referred to: Shumway v. Stilwell, (4 Cowen, 292;) 6 Wend. 447; Btarbuch v. Murray, (5 id. 148;) Borden v. Fitch, (15 John. 141.) The cases in the courts of other states are collected in the notes to Mills v. Duryea and McElmoyle v. Cohen, (2 Am Lead. Cas. 719 and seq.) and it will be found that the' courts agree that a recital in the record, of appearance or of service of process, is evidence of the fact recited, and they differ only as to whether the fact recited is conclusive or only prima facie. Our .courts hold the recital prima facie only.

The case of Sibley v. Waffle, (16 N. Y. Rep. 180,) is apparently in conflict with the cases above referred to. In that case the plaintiff sued in ejectment, to recover four acres of land purchased by him at a sale made by the administrator of one Dusenbury, under an order of the surrogate of Monroe county. It appeared, on the trial, that the widow and all the' heirs except two resided in the county of Monroe; the absent ones resided in Ohio. The order of sale recited the due publication of the order, and that the administrator had done all that was required by the statute to be done. But it also appeared, that-the order of the surrogate requiring.the heirs and next of kin to appear was not published in the state paper for the number of weeks required by the statute, to constitute a valid service on the absent heirs, and this court held the recital of due publication did not show jurisdiction in the surrogate to make the order of sale. The learned judge who delivered the opinion of the court did not refer to the cases cited, nor profess to overrule them or the -principle established by them, and hence I conclude that all this court intended to decide was that the recital of due publication did not overcome the proof that the order to show cause was published only five instead of six weeks as required by the statute. If such was the view of the court, then, although full effect had been given to the recital, yet as it was only prima facie, it was overcome by direct evidence that jurisdiction was not acquired by the surrogate.

Whether a recital of a jurisdictional fact in a record is or is not evidence of such fact, I am of the opinion that in the absence of any recital the law presumes that the court had jurisdiction to make the order in question. The court making it is a court of general jurisdiction, and it had by statute jurisdiction to appoint receivers in dases of insolvent corporations; and when an order is made appointing such officer, the presumption is that all things were done required by the statute to be done in order to authorize it to make such order. This conclusion seems to follow necessarily from the decision in the case of Bangs v. Duckenfield, cited supra, that in appointing a receiver in such cases the Supreme Court acts as'a court of general jurisdiction, and not as exercising a special statutory power. /

The instruction to the jury that prima facie the damages which the plaintiff was entitled to recover were the amount which the maker of the note agreed to pay and interest thereon, was correct. This is held to be the measure of damages, in 2 Philips’ Ev., Cowen & Hill’s ed. 228; 2 Parsons on Contracts, 471; Decker v. Mathews, (2 Kern. 324;) Sedgwick on Damages, 513; Panne v. Pritchard, (12 Eng. Com. Law Rep. 261.)

It was competent for the defendant to prove the insolvency of the maker, and thereby lessen the damages; but in the absence of any evidence of the want of ability to pay, the presumption is that he is solvent and able to pay the note. (Walrod v. Ball, 9 Barb. 271.)

It was insisted, on the trial, that the proper question to put to the witness in order to arrive at the measure of damages was, what was the value of the note ? and the ground on which the right to put the question rests is, that such is the inquiry in all other cases where the value of property is sought to be recovered. The general rule is that the value of property must be ascertained by answers to the direct questions as to its value. And the reason is that persons are examined who know its value, and can speak from their own personal knowledge in relation thereto. But this rule can not apply to choses in action; they have no intrinsic value, as a horse or an acre of land has. Their value ■ depends on the pecuniary condition of the parties liable thereon. And hence, in such cases, the direct and proper inquiry would be, are the parties to a bill or note, or other chose in action, solvent and able to pay their debts ? But as the law presumes that fact, in favor of the plaintiff, it is not necessary for him to prove it; and the burthen is therefore cast upon the defendant to disprove it.

I am of the opinion that the rulings on the trial were right, and that the judgment should be affirmed, with costs.

Denio, Ch. J.

concurred upon the point respecting the value of the note; but was for reversal on the single ground of receiving in evidence the final order for appointment of receiver without proof of the preliminary proceedings.

Ingraham, J.

concurred, except upon the point respecting the value of the note.

Selden, J.

The only evidence which was produced by the plaintiff to show his title as receiver, was the order appointing him receiver, made at a special term of the Supreme Court, and the execution and filing of a bond in pursuance of the terms of the order. It is insisted that this is not sufficient, without additional proof showing the pendency of the action in which ¡the order was made. Such further proof was not necessary. The appointment of a receiver was within the jurisdiction of the court; and where an order is made by a superior court which it has power to make under any circumstances, “all jurisdictional steps and matters of regularity are to be presumed.”- (The People v. Nevins, 1 Hill, 154, 159; Foot v. Stevens, 17 Wend. 483.) In making such appointment the court acts as one of general jurisdiction, and not under a special statutory power. (Bangs v. Duckinfield, 18 N. Y. Rep. 592.) The evidence, therefore, whether conclusive or not, was at least prima facie sufficient to establish the plaintiff’s title. “Nothing shall be intended to be out of the jurisdiction of a superior court, but what expressly appears to be so; nor within the jurisdiction of an inferior court but what is expressly alleged to be so.” (Peacock v. Bell, 1 Saund. 74.)

The teller of the Medina Bank had no authority to transmit the note of Weld to the Merchants’ Bank, and the latter bank refused to accept it on the terms on which it was transmitted. There was thus a double defect in the defendant’s claim of title; and the refusal of the defendant to surrender the note on the demand of the plaintiff, amounted to a conversion of it. The right of the plaintiff to recover was therefore unquestionable. The only real controversy between the parties related to the amount of damages.

There was no error in the charge of the- judge, or in his refusal to charge as requested. But on the trial, a witness, after testifying that he was acquainted with the parties to the note, and showing a somewhat intimate knowledge of their pecuniary condition, was asked by the defendant’s counsel what, in his opinion, the note in question was worth. This question was excluded, and the defendant’s counsel excepted. In this respect I think the court erred. As a general rule, undoubtedly, witnesses, other than experts, are required to testify to facts, and not to give opinions; but in determining the value of property, the well established rule in this state is otherwise; and I am unable to see any valid reason for making an exception in regard to the value of choses in action. It may be said that the witness can state the facts which go to determine the value, and that the jury will then be as capable of judging of the value as the witness. If the witness could state with perfect accuracy all the circumstances which constitute the basis of his own judgment, this position would be correct; but the impossibility of doing this has caused the adoption of the practice of allowing the witness to give his opinion upon questions of value, along with the reasons, as far as he is able to give them, upon which such opinion rests. The argument in .favor of confining the witness to the facts, and leaving the jury alone to deduce the conclusion, as to value, would apply with as much force to many of the cases where opinions are allowed as to the present case. (Clark v. Baird, 9 N. Y. Rep. 183.) For this error I think a new trial should be granted.

The other question addressed to the same witness, calling for his opinion in regard to the solvency of one of the parties to the note, was properly rejected. The question relating to the solvency of the maker, and that as to the value of the note, are by no means identical. There are many circumstances under which a note may have some value, although the maker be insolvent. The distinction between the. two questions is not very broad, but that relating to solvency was not within the exception to the rule that opinions are not evidence, which is established in regard to the value of property, and I am not disposed to extend that exception to cases not clearly within it.

Hogeboom, Davies, Weight and Johnson, JJ., were in favor of affirmance.

Judgment affirmed.


author:
Denio, Ch. J.
      Johnson, J.

text:
    William J. Kerr v. Richard E. Mount, jun., executor, &c.
    An attachment can be issued against a non-resident of the state only where an action for the recovery of money is depending.
    The mere issuing of a summons is not the commencement of an action, for general purposes. Until it is served, in case of a non-resident, so as to give the court jurisdiction of the person of the defendant, no attachment against ■ his property can be issued.
    In all actions, except those enumerated in sections 123 and 124 of the code, where there is only a single defendant, he must, to give the Superior Court of the city of New York jurisdiction, reside in the city, or be served with the summons therein.
    Where process has been set aside for irregularity, it will afford no justification to the party at whose instance it was issued, for acts done under it.
    A process being void, the party who sets it in motion, and all persons aiding and assisting him, are prima facie trespassers, for seizing property under it.
    Acts which an officer might justify under process actually void but regular and apparently valid on its face, will be trespasses as against the party.
    The moment process is set aside for irregularity, the party becomes a trespaser ah initio; and the return of the property will only go in mitigation of damages. _ It is no answer in bar of an action for the wrong.
    The officer, in such a case, is the agent or servant of the party in whose favor the process is issued, and the party is liable for any injury to the goods, caused by his negligent or careless acts while such goods are in his possession.
    Appeal by the defendant from a judgment of the Supreme Court. The complaint alleged the illegal seizure by the original defendant, Moffat, of two casks of certain valuable lamps called oleostatic lamps, being fifty-eight in number, under pretense of an attachment in favor of one Cole, against the property of the plaintiff.' It admitted that all the lamps except one had been returned to the plaintiff under certain proceedings in the Superior Court of the city of New York, but it alleged that when returned they were in a damaged state, having been injured after the taking. The answer set up an attachment in favor of Cole against the plaintiff, and it denied that the lamps sustained any injury before their return to the plaintiff. It appeared on the trial that the plaintiff resided in the city of Philadelphia, and that on the 3d of May, 1849, Calvin L. Cole applied, on affidavit, to Thomas J. Oaklet, Chief Justice of the Superior Court, for a warrant of attachment against the property of the plaintiff. The affidavit of Cole stated that the plaintiff was not a resident of this state, hut a resident of Philadelphia, in the state of Pennsylvania, and was indebted to the defendant in the sum of $450 for the rent of certain premises in Broadway, New York, and added, “and deponent has commenced an action for the recovery of said sum of money, a summons has been issued therein.” The Chief Justice accordingly issued a warrant reciting the affidavit, and directing the sheriff of the city and county of New York to attach and safely keep all the property of the plaintiff in the present action, which was within the city and county of New York. It appeared that under this precept a deputy sheriff had seized and taken possession of the two casks of lamps, the taking having been directed by Moffat, the original defendant in this action, who acted in behalf Cole and the alleged creditors. It further appeared that on the 7th of November, 1849, the plaintiff Kerr caused a motion to be made in the Superior Court to set aside the attachment and require the sheriff to return the property to the said plaintiff. On this motion an order was made setting aside the attachment. The case is reported in 2 Sandf. Sup. Ct. Bep. p. 660. Long afterwards the sheriff returned the casks of lamps, except one of the lamps, to the plaintiff, and they were thenceforth kept in a store under his direction. The plaintiff’s evidence showed that while in the hands of the deputy sheriff, the lamps had been taken out of the casks and put back into them, in doing which they had been considerably damaged. There was some contradictory evidence on the subject of the damage. At the close of the plaintiff’s evidence the defendant’s counsel moved for a nonsuit, on the ground that the defendant was not in any event responsible for the injury to the lamps; and he excepted to the refusal of the judge to grant the motion. At the close of the case he desired the jury to be charged that the defendant Moffat was not responsible for any damage to the property in question caused by or resulting from the negligence of the sheriff; that the damage was too remote, and that Moffat, if liable at all, was only liable for the taking of the property. The judge declined to so charge, but on the other hand he charged that if the jury found that the plaintiff was the owner of the property, and that it was taken and removed by the sheriff by the direction of Moffat, the plaintiff was entitled to recover for the injury done to it between the removal and the return of it to the plaintiff. The defendant’s counsel excepted to the several rulings against him, and to the charge. The verdict was for the plaintiff for $483 damages. After an affirmance at the general term, the original defendant, Moffat, brought this appeal. During its pendency he died, and the present defendant, his executor, was substituted in his place, The case was submitted on printed briefs.

      J. E. Burrill, for the appellant.
    I. In seizing the property, the sheriff acted in his official capacity as an.officer of the law, and not as the private agent of the defendant, and the attachment was a full protection to him. (Savacool v. Boughton, 5 Wend. 170; Parker v. Walrod, 16 id. 518; Webber v. Gay, 24 id. 485; Parsons v. Lloyd, 3 Wils. 34; 1 Archb. Nisi Prius, 365; 2 id. 507, 509.)
    II. As soon as the property was taken by the sheriff, it was in the custody of the law, and beyond the reach and control of the defendant, and he is not liable for the injuries thereafter sustained by it. 1. In retaining the custody of the property, the sheriff acted in his official capacity, and not as the private agent of the defendant. 2. The complaint charges that the damage complained of resulted from a violation and neglect of duty on the part of the sheriff, in not taking proper care of the property after it had been seized and taken possession of by him. 3. There is no proof that the defendant had any control over the property after it had passed into the hands of the sheriff, or that he in any manner interfered therewith. (Cases under Point I; Jenner v. Jolliff, 9 John. 383.)
    III. The defendant’s liability in respect to the property arose from having put the sheriff in motion, by the delivery of the attachment to him for execution, and all that was done by the sheriff, at the instigation or by the direction of the defendant, was the seizure of the property, and the defendant’s liability must be limited to the damages resulting from the natural and proximate consequences of such act. (2 Greenl. Ev. § 256; Armstrong v. Percy, 5 Wend. 535-8; Crain v. Petrie, 6 Hill, 524.)
    IY. This action is not brought to recover damages for the original taking, but for the damages arising from injuries to the property occasioned by the want of that care and diligence in respect to the custody of the property, which the sheriff was properly and legally bound to exercise. And the rule of damages is not necessarily the same as in an action of trespass for the original taking.
    V. Regarding the sheriff as the agent of the defendant, still the only authority presumed by the law to have been conferred upon him, is an authority to do all lawful acts belonging to his employment. (Story on Agency, § 308; Foster v. Essex Bank, 17 Mass. 479; Gray v. Portland Bank, 3 id. 264.)
    YI. The evidence did not establish that the attachment was void or irregular, or that it had been set aside on either of those grounds; but, on the contrary, it appears that the attachment was legally and rightfully issued, and non constat that it was not set aside on giving the undertaking required by law. (Newberry v. Lee, 3 Hill, 526, 7; Code, §§ 229, 240.)

      VII. The attachment was valid and effectual, and justified the taking and detention of the property. (Code, §§ 227-229.)

      John C. Dimmick, for the respondent.
    I. The attachment under which the property in question was taken was unauthorized and without jurisdiction on the part of the court or officers issuing it, as Kerr, the defendant in the attachment, was not a resident of this state, and had not been served with a summons in the action in the Superior Court when the attachment was issued.. All persons concerned in the taking of the property were, therefore, trespassers. (Fisher v. Curtis, 2 Sandf. Sup. Court Rep. 660.)
    II. If the attachment had been regular in the first instance, yet having been set aside by the court, it can not be any protection to the defendant Moffat, and he stands before the court as though he had taken the goods without any process whatever; for a process set aside by the court is as no process. (Chapman v. Dyett, 11 Wend. 31.)
    III. The defendant Moffat being one of the original trespassers concerned in taking the property, is liable to the plaintiff for all damages sustained by the plaintiff in consequence of the wrongful taking of his property on returning the same in an injured condition. 1. By taking the property Moffat became liable to the plaintiff for the full value of the property. 2. This amount of damages may be mitigated by showing that the plaintiff subsequently repossessed himself of the property: the benefit the plaintiff derived thereby depending upon the condition of the property when returned, will be deducted from the full value he would otherwise recover. (Vosburgh v. Welsh, 11 John. 175; Hanmer v. Wilsey, 17 Wend. 91.)
    IV. The action we have brought is the substitute for trover or trespass before the code, and there can be no doubt that before the code Moffat was liable to us in trovér or trespass for these goods, and in that action the plaintiff would recover the whole value of the goods, subject to the right of the defense to show in diminution of damages a return of the property. If the property, when returned, was injured to half its valué, the plaintiff’s damages would be diminished one half, and the residue he would be entitled to recover. (See cases above cited under third point.)
   Denio, Ch. J.

The warrant of attachment was undoubtedly void. It could only be issued where an action was depending. The authority to grant it against a non-resident of the state is given only “ in an action for the recovery of money against a defendant who is not a resident of the state.” (Code, § 227.) The mere issuing of a summons is not the commencement of an action for general purposes, (§ 99.) Besides, the Superior Court had not jurisdiction of the action attempted to be commenced. In certain actions enumerated in §§ 123 and 124 of the code, that court has jurisdiction, without regard to the defendant’s residence, when the cause of action shall have arisen in thé city; but an action on contract, for the recovery of money, is not among those there enumerated. In all other actions where there is only a. single defendant he must, to give the court jurisdiction, reside in the city or be served with the summons therein, (§ 33.) Moreover where process has been set aside for irregularity, the party at whose instance it was issued can not justify under it, though probably the officer may. (Chapman v. Dyett, 11 Wend. 31.) The position mainly insisted on by the counsel for the defendant is, that if the seizure were considered to be illegal and an act of trespass on the part of the defendant, still the injury to the property by the negligence of the sheriff’s officer was not chargeable to the defendant, but only to the sheriff. By procuring the process and placing it in the hands of the officer, the defendant, it is urged, became responsible only for conduct on the part of the officer which he would have had a right to pursue if the process had been valid. He did not direct or countenance the culpable negligence and inisconduct by which the property was injured, but only the seizure of it and the keeping-of it securely and carefully. If he had only done this, the property would have been returned to the plaintiff in the same state it was in when seized; the damages would have been nominal. In this action it is contended no recovery except as to the missing lamp, could be had, because it is brought to recover for the injury, and not for the seizure. This argument overlooks the legal nature of the action.- It was in substance an action for trespass de bonis asportatis, with an admission not usually inserted in the plaintiff’s pleading in such an action, or at all necessary, that the trespasser had returned the property, and a qualification annexed to that concession, that it was returned in a damaged condition. If the same facts had appeared in evidence without having been set out in the complaint, the return would have gone in mitigation of damages, to. a certain extent, but in a degree less by the amount of injury they had sustained by the sheriff’s negligence. (Vosburgh v. Welch, 11 John. 175; Hanmer v. Wilcox, 17 Wend. 91.) The circumstance that the plaintiff had unnecessarily inserted a statement of the mitigating fact in his complaint was of no legal consequence. The process being void, the party who set it in motion, and' all persons aiding and assisting him, were prima facie trespassers. If, though void as respects the party, it were yet regular and apparently valid on its face, it might protect the officer against an action, on the principle of Savacool v. Boughton, (5 Wend. 170;) but this protéction, being extended to the officer upon motives of policy, would' not at all aid the party. Acts which the officer might justify, would be trespasses against the party. There is no principle with which I am acquainted which can shield the defendant from the damages which the plaintiff has sustained by his wrongful act in causing this property to be seized under a void warrant of attachment. Hence I am in favor of affirming the judgment appealed from.

Johnson, J.

The attachment under which the goods in question were taken and held hy the shériff, was set aside hy the Superior Court of the city of New York for irregularity. I incline to the opinion that the attachment was a nullity on account of the court, out of which it was issued, having no authority to issue stich a process. But I have not examined that question, because, conceding it to have been issued by proper authority in respect to jurisdiction, still it having been set aside as irregular, it' afforded no justification afterwards for acts previously done under it, to the party in whose favor it was issued. If issued by competent authority, and regular upon its face, it might afford protection to the officer for his acts previously done under it, but none whatever to the party. As to him, it was then, as though no process whatever had been issued, and the goods had been taken and detained by his order without any process. (Chapman v. Dyett, 11 Wend. 31; Smith v. Shaw, 12 John. 257; Hayden v. Shad, 11 Mass. Rep. 500; Codington v. Lloyd, 8 Adol. & Ell. 449; Parsons v. Lloyd, 2 Black. 845.) The moment it was set aside, the party became a trespasser ah initio.

The return of the property in such a case only goes in mitigation of damages. It is no answer in bar of the action for the wrong. (Hanmer v. Wilsey, 17 Wend. 91.) The officer in such a case is the agent or servant of the party in whose favor the process is issued, and the party is clearly liable for any injury to the goods caused by his negligent or careless acts while such goods are in his possession.

The judgment should therefore be affirmed.

All the Judges concurred.

Judgment affirmed.


author: Davies, J. Rosekrans, J.

text:
    Susannah B. Young, Administratrix, &c., v. James H. Brush and others, Executors, &c.
    Where a testator, by his will, left personal property in this state, and real estate in New Jersey to B. his executor, in trust for G. for life, and then to be sold, which will was proved in this state; Held, that B. could not properly protect the property, or make a good title to it on the sale, unless the will was duly proved and established in the state where the property was situated. That it was therefore a matter of necessity that the will should be proved in New Jersey; and that the executor, on accounting as trustee, was entitled to be allowed the costs of the probate in that state.

      Held, also, that the decrees of the appropriate courts in New Jersey, directing the costs of the proceedings there to be paid by the trustee out of the estate of the testator, afforded him warrant and protection for making such payment; and that after a considerable lapse of time his personal representatives ought not to be called upon to furnish any other evidence of the necessity of such payment.
    Appeal from a judgment of the Supreme Court. Catharine C. Young, by her will, left certain personal property in the city of New York, and certain real property in New Jersey, to David Brush, as executor, in trust for her son, George Young, during his life, with certain limitations over. The will was proved before the surrogate of the city and county of New York, who set aside the limitations over. Some questions were raised, upon the probate, as to the residence of Mrs. Young. The will was subsequently proved in the state of New Jersey. After the death of David Brush, the executor, and of George Young, the cestui que trust, Catharine B. Young, who was the administratrix with the will annexed of Mrs. Young, brought this action against the personal representatives of.David Brush, to compel an accounting, and for payment of the sum found due to her.
    The action was'referred, and the referee reported $5,179.29 due from the defendants. On the accounting the referee refused to allow the items of the expenses of the probate in New Jersey, and the costs of this action, and also charged the executors with interest. From the judgment entered on the referee’s decision the defendants appealed to the general term of the Supreme Court, who corrected the judgment so far as the item of interest was concerned, but affirmed the rest. (38 Barb. 294.) From that decision the defendants appealed to this court.

      Oharles H. Smith, for. the appellants.
    I. The facts that it would depend on the then, if not now, doubtful question of domicil whether this probate would be conclusive when the. executor, after the death of George Young, should be required to account; that the question of undue influence, on which the disputed ■ portions of the will depended, was one which could not be safely left to be investigated'at the happening of the uncertain event of George Young’s death; that four counsel were employed' by the contestants who litigated both in New York and New Jersey at great expense and with great vigor; that these counsel did not raise the point of domicil, that the New Jersey courts established the will, so that it stood confirmed in New Jersey and set aside in New York; that those courts, by their decrees, allowed these very expenses; and, above all, the fact that there is no evidence impeaching the' good faith and prudence of the executor, and that for twenty-three years no .complaint was made of improper use of the funds of the estate in litigation, make a question of reasonable and probable cause, which is a question of law, and upon which it should be held that the executor was entitled to his reasonable expenses, (Story’s Equity, § 65) oí proving the will in New Jersey. (Bulkeley v. Keteltas, 2 Seld. 384; S. C. on new trial, 2 Duer, 273; Besson v. Southard, 6 Seld. 236, 240; Vedder v. Fellows, 20 N. Y. Rep. 126; Spencer v. Bank of Salina, 3 Hill, 520; Small v. Smith, I Den. 583; Steves v. Oswego, &c. R. R., 18 N. Y. Rep. 422.)
    II. The case is properly framed to present this question as a matter of law. The evidence set out shows a clear case of probable cause which a court would have been bound, if it had been a jury trial, not to leave to the jury, but to decide as matter of law. (Pratt v. Foote, 5 Seld. 463-5; Spencer v. Ballou, 18 N. Y. Rep. 327-338; Brown v. Penfield, 24 How. Pr. 64.) The expenses are disallowed in bulk. They were not disallowed as being unreasonable in amount, and the account shows the rejected items included all the Hew Jersey expenses.
    III. The question of domicil had nothing at all to do with the case, further than it bore upon the question of probable cause, for proving the will in Hew Jersey.
    IV. The executor was made a trustee of the real and personal on the same trusts as to both. After the death of Greorge the realty was to be sold and distributed with the personalty as one fund and to the same purpose. Expenses of proving a will of real and personal estate are chargeable in the first instance, and as far as the executor is concerned, on the personalty, especially where the beneficiaries are the same persons, and the realty is unproductive and not to be sold until the death of a person, for whose use it is given for life. If there are any equities between the distributees as to who shall pay these expenses, those are to be determined when the distribution shall take place. (Mesick v. Mesick, 7 Barb. S. C. R., 120, 124, 5.)
    V. Non constat, but by the law of Hew Jersey it was necessary to prove the will there. It was for the plaintiff to prove what that law was.
    VI. The decision of the Hew Jersey courts was not .only material, but conclusive -on the question of the expenses. Those courts had jurisdiction, and the cestuis qui trust were either parties or represented by. the executor, and no fraud is alleged.

      Marshall S. Bidwell, for the respondent.
    I. There was no dispute as to the amount received by David Brush. The liability of the defendants as executors to .account to the plaintiff for this amount was clearly established.
    II. They claim to be allowed pertain charges and payments. The onus as to those was on them. If they did not establish them—if it was even doubtful—the referee could not allow them.
    III. The referee allowed to the defendants as much as they were entitled to. Indeed, he granted to them considerably more than he should have done. (Code, §§ 307, 308; 3 Code R. 21, 192; 4 How. Pr. 252; 5 id. 153; Willcox v. Smith, 26 Barb. 316, 329, 330.)
    IY. The probate, granted by the surrogate of Hew York, was conclusive on all parties. 1. Brush, the executor, not only was a party to the proceeding, but he himself made the application and obtained letters testamentary. It is, in the courts of this state, absolutely conclusive on all the parties. 2. There was no personal property in Hew Jersey. There is no proof of any, and it appears, affirmatively, that there was not any. 3. Mrs. Young was not domiciled in Hew Jersey.
    Y. There was not competent" or sufficient evidence of the proceedings in Hew Jersey. The papers produced purported to be copies of only part of the proceedings in the court. •The whole should have been produced. (2 Cow. & Hill, 1059.)
    YI. These proceedings were binding only on those persons who were parties to them. The plaintiff, although a child of the testatrix, does not appear to have been a party.
    YII. The proceedings in Hew Jersey were instituted in relation to the real estate owned there. The expenses of these proceedings could not have been charged upon the personal property in this state, even if all persons interested had been parties in such proceedings. It was manifest that this was the understanding of all parties, or that there was some arrangement or compromise in relation to them; as it appears from the accounts that none of the other parties received any • thing from the estate on account of their costs, although they were as much entitled to them as David Brush was to his costs and expenses. It is evident that subsequent to the proceedings in ¡New Jersey, the parties had settled the matter by compromise and agreement.
    VIII. His claim was barred by the lapse of time, both by the statute of limitations, and by the general principles of equity jurisprudence. If he intended to claim them, he should have presented his accounts to the • surrogate in due season, and had them allowed. (Treat v. Fortune, 2 Bradf. 116; Dayton on Surrogates, 394, 3d ed.; Laws of 1837, 531, ch. 460, § 37.)
   Davies, J.

There is no allegation that the payments disallowed by the referee were not made in good faith by the executor and trustee, and I am at a loss to perceive any substantial reason why they should not be allowed. It is to be borne in mind that the complaint in this action is in the nature of a proceeding in equity, to call upon the executor and trustee for an account and transfer, and to deliver over to the administratrix, with the will annexed, all the estate of the deceased. It is not a proceeding before the surrogate to call him to account as executor solely; and therefore it is that all the just and equitable payments made by the executor and trustee, in the management of the estate while under his control, are proper matters to be now disposed' of and adjudicated.

It is quite clear to my mind that the executor and trustee but performed a duty incumbent upon him, in seeking to establish the will in ¡New Jersey. There was real estate which passed by the will, and which by its provisions was vested in the executor as a trustee. ’On the death of the cestui que vie it was to be sold by him, and the proceeds distributed according to the terms of the will. He could not properly protect the property, or make a good title to it on such sale, unless the will was duly proved and established in the state where the land was situated. It became a matter of necessity, therefore, that the will should be proved in New Jersey; and when the representatives of the executor and trustee were called upon in equity to account for the estate of the decedent received by their testator, all the payments made by him, and expenses legitimately incurred by him, in establishing his title to the estate, so confided to him, they were entitled to be credited with such payments. It is thought to be well settled that a trustee, while acting under a general trust, is entitled to be allowed for all disbursements for taxes, repairs, salaries, insurances, and for all other charges and expenses which he in good faith thinks proper to pay. (7 Ves. 480; 3 Russ. 448; 2 John. Ch. 14; Id. 619.)

There can be no doubt that costs incurred by the trustee in protecting the estate confided to his care, and paid by him, should be reimbursed to him out of the estate. In the present case, I think the decrees of the-courts in New Jersey directing the costs of the proceedings'there to be paid by the trustee out of the estate of the decedent, afforded him warrant and protection for making such payment; and it was error in the learned referee not to have allowed such payment to his representatives. They ought not to be called upon, after this great lapse of time, to furnish any other evidence of the necessity of such payment. •

I think the items should have been allowed, and the referee having found that they were in fact paid at the dates, and for the purpose specified, the total amount thereof should be deducted from the amount of the judgment in this action. They are enumerated in the referee’s report.

A new trial should be ordered.

Rosekrans, J.

Catherine C. Young, by her will, not only appointed David Brush her executor, but devised to him certain real estate, and all her personal property in trust, to receive the rents, issues, and profits of the real estate, and the interest of the personal property, and pay the same, excepting the taxes and necessary repairs of the real estate, to George Young, the son of the testatrix, during his natural life. The real and personal estate of the testatrix was thus made the subject of one and the same trust by the will, and the title of both kinds of property was devolved upon the trustee for the purpose of the trust. The will contains no directions as to the particular fund out of which the reasonable expenses of the trustee incurred in relation to any portion of the property, which is the, subject of the trust, shall be paid; and it is difficult to understand upon what principle it can be claimed, that such expenses shall be charged to the particular kind of property, in the management of which the expenses were incurred. The general rule is, that trust property shall reimburse a trustee for all his charges and expenses properly incurred in the execution of the trust, (Worrall v. Harford, 8 Ves. 8,) and such charges and expenses constitute a charge or lien on the trust-estate in favor of the trustee, and he is not to be compelled to part with the legal estate until his claim is discharged. (8 Ves. supra; Hill on Trustees, 567, 570.) In the case of The Attorney General v. The Mayor of Norwich, (2 M. & C R., 406, 424,) Lord Oottenham stated it to be quite clear according to the rule which applied to all cases of trust, that if necessary expenses are incurred in the execution of a trust or in the performance of duties thrown on any parties, and arising out of the situation in which they were placed, such parties are entitled, without any express provision for that purpose, to make the payments required to meet those expenses out of the fund in their hands belonging to the trust; and he said such was the rule of courts of equity and at common law. This language implies that the trustee has the whole trust fund to which he may resort for the reimbursement of his reasonable expenses incurred'in the execution of the trust. Where there is nothing in the instrument creating the trust, limiting the trustees to a particular fund, or kind of property, for reimbursement of such expenses, a rule which should thus limit him might operate unjustly upon him, qnd tend to embarrassment in the discharge of the duties of his trust.

The account rendered by thé trustee does not disclose that he ever received any thing from the real estate in New Jersey, which was a part of the subject of the trust. Doubtless he allowed the cestui que trust to occupy this property, and appropriate the rents, issues, and profits to his own use; and yet, if not absolutely necessary, it must be conceded to have been prudent on the part of the' trustee to have the will proved in New Jersey for the purpose of protecting his title to this property, and the interest of the cestui que trust, as well' as the interests of those who were entitled in remainder. It might have become necessary to institute actions in relation to this property which could not have been maintained without tfye probate of the will. Beal estate is governed by the laws of the state in which it is situated. Not only houses and lands, but charges on land, including trust estates, are declared in law to be immovables, and' governed by the lex rei sitce, and no interest can be acquired in such property except by the persons, and under such circumstances as the local law prescribes. The validity of every disposition of real estate must depend upon the law of the country in which it is situated. (Story’s Conf. of Laws, § 424.)

The trustee is presumed to have acted in good faith, and in the absence of any evidence of bad faith on his part, it. can not be affirmed that his submitting the will for probate in New Jersey, by which his title to real estate in that state was acquired, was not in accordance with the dictates of sound discretion. Indeed, it is questionable whether it would not have been an act of gross negligence on the part of the trustee to have omitted the probate, of the will in the state of New Jersey. If it be conceded that the- domicil of the testatrix at her death was in the state of New York, and that the distribution of her personal estate must be in accordance with the laws of this state, it by no means follows that the trustee is to be deprived of the personal estate in his hands as such trustee, until his reasonable expenses are fully paid, which he has incurred in relation to all the subjects of the trust. The ruling of the referee, and the decision of the Supreme Court did not regard the character of David Brush as trustee. He was called upon to account simply in the character of executor of the will, having control only of the personal estate of his testatrix, and his rights as trustee of both the real and personal estate were not considered.

The referee expressly finds that the expenses charged in the account for the litigation arising out of the probate of the will in Hew Jersey were actually incurred; that the decrees of the court in Hew Jersey were made, admitting the will to probate in that state,- and directing that the taxable costs of the parties to the litigation, together with their reasonable counsel fees, be paid out of the estate of the testatrix ; but he finds that those decrees were immaterial on the question of the allowance of the expenses of the litigation in those courts out of the personal estate of the testatrix The litigation having been shown, and the expenses to have been incurred upon an issue of devisavit vel non, the trustee was entitled to all his reasonable costs and expenses, to be paid out of' the estate, independent of the decrees in the state of Hew Jersey. (Bradford v. Boudinot, 3 Wash.C. C. R. 122.)

The plaintiff was only entitled to the balance of the trust fund after the trustee had been allowed his costs as between solicitor and client, and other necessary and reasonable charges.

These reasons are sufficient to require a reversal of the judgment. It is also a general rule that the trustees are entitled to costs of litigation in relation to the trust fund where there is no evidence of bad faith on their part, and we think the judgment in this case is erroneous in not allowing the defendants the costs of this litigation.

The judgment should be reversed and a new trial ordered.

All the other Judges concurring,

Judgment accordingly.


author: Hubbs, J.

text:
    John Farrington, Appellant, v. Harlem Savings Bank, Respondent.
    Argued January 10, 1939;
    decided February 21, 1939.

      Joseph B. Kenny, Harry B. Chambers, Harry H. Chambers, Jack Wasserman and Samuel H. Henis for appellant.
    The release is not binding upon the plaintiff because his signature was obtained and the money paid under a mutual mistake of fact as to the nature and extent of plaintiff’s injuries. The parties had no knowledge that plaintiff was suffering from serious and permanent injuries, and there was no intention that plaintiff’s claim for such injuries was to be released. (Landau v. Hertz-Drivurself Stations, Inc., 237 App. Div. 141; Dominicis v. United States Casualty Co., 132 App. Div. 553; Kirchner v. New Home Sewing Machine Co., 135 N. Y. 182; Gold Hunter Mining & Smelting Co. v. Bowden, 252 Fed. Rep. 388; Texas & Pacific Ry. Co. v. Dashiell, 198 U. S. 521; Shook v. Illinois C. R. Co., 115 Fed. Rep. 57; Rosenblum v. Manufacturers Trust Co., 270 N. Y. 79; Leary v. Geller, 224 N. Y. 56; Moses v. Carver, 254 App. Div. 402; Great Northern Ry. Co. v. Reid, 245 Fed. Rep. 86; Hudgins v. Standard Oil Co., 136 Cal. App. 44; Mix v. Downing, 176 Minn. 156.) The release was not binding upon the plaintiff because of the fraud of defendant’s investigator in misrepresenting that the paper which he asked plaintiff to sign was a receipt. (Barker v. Conley, 267 N. Y. 43; Hutchison v. Ross, 262 N. Y. 381; Wilcox v. American Tel. & Tel. Co., 176 N. Y. 115; Cleary v. Municipal Electric Light Co., 65 Hun, 621; 139 N. Y. 643; Lassell v. Mellon, 219 App. Div. 589; Outcault Advertising Co. v. Stratton, 178 App. Div. 353; Scully v. Brooklyn Heights R. R. Co., 155 App. Div. 382; Yaple v. N. Y., O. & W. Ry. Co., 57 App. Div. 265; Fleming v. Brooklyn Heights R. R. Co., 95 App. Div. 110; Grockie v. Hirshfield, 50 App. Div. 87.)

      Walter L. Glenney and Chauncey L. Grant for respondent.
    The release is not avoided by misrepresentation or fraud and is, therefore, a complete defense. (Miles v. N. Y. C. R. R. Co., 195 App. Div. 748; 233 N. Y. 644; Meginn v. Ramsdell, 163 App. Div. 232.) Even if the plaintiff suffered subsequently from injuries not known when the release was given, the release is a valid defense. (Kirchner v. N. H. S. M. Co., 135 N. Y. 182; Moses v. Carver, 164 Misc. Rep. 204; 254 App. Div. 402; Pimpinello v. Swift & Co., 253 N. Y. 159; Matter of Stone, 272 N. Y. 121; Berry v. Struble, 66 Pac. Rep. [2d] 746; McIsaac v. McMurray, 77 N. H. 466; Morris v. Seaboard Air Line R. Co., 23 Ga. App. 554; Rideal v. Gt. Western R. Co., 1 Fost. & F. [Eng.] 706; Kansas City So. Ry. Co. v. Armstrong, 171 S. W. Rep. 123; Houston & T. C. R. R. Co. v. McCarty, 94 Tex. 298; Metzger v. Ætna Ins. Co., 227 N. Y. 411.)
   Hubbs, J.

In this action to recover damages for personal injuries growing out of defendant’s negligence, the plaintiff’s evidence established a prima facie case. As a defense a general release was introduced in evidence. It is drawn in the broadest terms and in consideration of the payment of thirty dollars purports to release the defendant from all claims for damages, both present and future. At the close of the evidence the trial court dismissed the complaint upon the ground that the plaintiff was bound by the release. The Appellate Division affirmed, one justice dissenting.

The instrument was drawn and executed four days after the accident. At the time the plaintiff was waiting on customers in a store. He testified that he did not read the instrument and that the claim agent who paid him the thirty dollars stated that the paper was a receipt and that the thirty dollars was to reimburse him for the doctor’s bills. The only known injury at the time was a scalp wound and some bruises. Immediately after the injury plaintiff had it dressed by a doctor, who told him to go back to work, which he did. About three weeks later it was discovered that a bone of the left arm had been injured and that he was suffering from a fracture of the humerus. He has lost the use of the arm and the fingers of the left hand are without feeling.

At the time of the alleged settlement neither the claim agent nor the plaintiff knew of any injury except the superficial injuries referred to. No doubt the plaintiff had a perfect right to agree to settle for the injuries which were known and for all other injuries which might result, and such an agreement would be binding upon him no matter how serious the result of the injuries might thereafter turn out to be, provided the agreement was fairly and knowingly made.

The complaint having been dismissed, the question here presented is whether there was any evidence\that the plaintiff was induced by fraud or mistake to sign the instrument. We believe there was evidence which required the court to submit that question to the jury. Plaintiff testified that he was busy waiting on customers, that the claim agent laid the paper on a safe and asked him to sign the receipt and that he signed it without reading it; also that the payment of thirty dollars was to pay the doctor’s bill. There is other evidence in the case having a bearing upon the question.

The plaintiff was not required to return the thirty dollars received. He was not seeking to rescind a contract on the ground of fraud. He denied that he made the contract. His contention is that there was not to be a contract at all but only a receipt for thirty dollars in payment of the amount of the doctor’s bill. That agreement he did not seek to avoid, but the contract relied upon by the defendant he asserts' in fact was never made, although it was embodied in the release without the plaintiff’s knowledge. (Cleary v. Municipal Electric Light Co., 65 Hun, 621, opinion of Cullen, J., reported in 47 N. Y. St. Repr. 172; S. C., 19 N. Y. Supp. 951; affd., 139 N. Y. 643, on opinion below; Wilcox v. American Tel. & Tel. Co., 176 N. Y. 115; Boxberger v. N. Y., N. H. & H. R. R. Co., 237 N. Y. 75.)

The judgments should be reversed and a new trial granted, with costs to the appellant to abide the event.

Crane, Ch. J., Lehman, O’Brien, Loughran, Finch and Rippey, JJ., concur.

Judgments reversed, etc.


author: Per Curiam.

text:
    The People of the State of New York, Respondent, v. Peter Rudnick, Appellant.
    Argued January 18, 1939;
    decided February 21, 1939.

      Frank Serri for appellant.
    A motion to dismiss the information on the ground that no crime is charged is in substance a demurrer to that information, and need not be repeated twice, in order to insure review of that point on appeal. (People v. Wiechers, 179 N. Y. 459; People ex rel. Phillips v. Hanley, 164 App. Div. 150; People ex rel. Hummel v. Trial Term, 184 N. Y. 30; People v. Zambounis, 251 N. Y. 94.) “ For the purpose of obtaining any benefit or payment under the provisions of this chapter ” means a benefit or payment expressly provided by the Workmen’s Compensation Law (Cons. Laws, ch. 67), that is compensation for injured employees, death benefit to dependents or payment of legal, medical and funeral services. (Lindebauer v. Weiner, 94 Misc. Rep. 612.)

      William F. X. Geoghan, District Attorney (Edward H. Levine of counsel) for respondent.
    The decision denying the motion to dismiss the information is no part of the judgment roll nor is it an intermediate order and it is not appealable. (People ex rel. Phillips v. Hanley, 164 App. Div. 150; People v. Zambounis, 251 N. Y. 94; People v. Cully, 167 App. Div. 332; People v. Wiechers, 179 N. Y. 459; People v. Zerillo, 200 N. Y. 443; People v. Reed, 276 N. Y. 5; People v. Green, 201 N. Y. 172; People v. Lagersohn, 147 App. Div. 227; People v. Walsh, 172 App. Div. 266.) The information sets forth a crime. (Matter of Rheinwald v. Builders’ Brick & Supply Co., 168 App. Div. 425.)
   Per Curiam.

The defendant moved to dismiss the information “ on the ground that the facts stated therein do not constitute a violation of section 114 of the Workmen’s Compensation Law of the State of New York nor a crime under any law of this State.” We think this motion was the equivalent of a demurrer to the information. (Code Crim. Proc. §§ 323, subd. 2, 324.) The Presiding Justice of the Court of Special Sessions entered upon the information the following indorsement: “ Motion to dismiss denied.” Since we think this entry was sufficient as an order disallowing the demurrer (Code Crim. Proc. § 326), the actual decision thereby made must be reviewed on this appeal. (Code Crim. Proc. §§ 485, subd. 2, 517.)

We hold that the facts stated in the information constitute the misdemeanor defined by section 114 of the Workmen’s Compensation Law (Cons. Laws, ch. 67).

The judgment should be affirmed.

O’Brien, Loughran, Finch and Rippey, JJ., concur; Crane, Ch. J., Lehman and Hubbs, JJ., dissent.

Judgment affirmed.


text:
    Central Savings Bank in the City of New York et al., Appellants, v. City of New York et al., Respondents.
    Submitted February 20, 1939;
    decided February 21, 1939.

      William C. Chanler, Corporation Counsel (William S. Gaud, Jr., of counsel), for motion.

      Jesse Knight, John H. Willenbrok, Kenneth N. LaVine, Robert C. Fulton, Jr., Edwin A. Berkery and Joseph H. Praetz for Central Savings Bank in the City of New York et al., opposed.

      William I. Hart and Joseph R. Truesdale for Dry Dock Savings Institution et al., opposed.
   Per Curiam.

In our opinion in this case we stated that under the statute property is taken without due process of law (State Const, art. 1, § 6) and,” etc. (279 N. Y. 266, 275). A statute repugnant to the due process clause of the State Constitution is repugnant also to the due process clause of the Fourteenth Amendment of the Constitution of the United States. The clauses are formulated in the same words and are intended for the protection of the same fundamental rights of the individual and there is, logically, no room for distinction in definition of the scope of the two clauses.

Decisions of the Supreme Court defining the scope of the due process clause in the Federal Constitution are binding upon every court and in every State. We did not by reference solely to the Constitution of the State intend to indicate that though we cannot give validity to a statute which is repugnant to the due process clause in the Federal Constitution we would give wider scope to the same clause in the State Constitution and hold invalid statutes not repugnant to the Federal Constitution as defined by the Supreme Court. No such question was presented or considered in this court. We gave to the decisions of the Supreme Court of the United States, defining the due process clause, the great weight which, in our opinion, they should have by reason of the prestige of the court and the strength of the reasoning even if technically we might have power to reject them in defining the same clause in the State Constitution. Our conclusion that the statute is repugnant to article 1, section 6, of the State Constitution followed necessarily from our determination that in accordance with a long line of decisions of the Supreme Court of the United States, the statute is repugnant to the Federal Constitution. (Cf. Morehead v. Tipaldo, 298 U. S. 587.) In order to correct any misapprehension that might arise under our opinion the motion for reargument is granted and upon such reargument the sentence above quoted is amended to:' read: “ His property is thus) taken without due process of law (U. S. Const. 14th Amend.; State Const, art. 1, § 6) and,” etc.

The motion to amend the remittitur is granted to the extent of adding thereto the following:

A question under the Federal Constitution was duly presented and necessarily passed upon by this court. The plaintiff contended that chapter 713 of the Laws of the State of New York of 1929, as amended, is repugnant to article 1, section 10 of the Constitution of the United States and to the Fourteenth Amendment of that Constitution. This court held that such law is repugnant to article 1, section 10 of the Constitution of the United States and to the Fourteenth Amendment of that Constitution.”


text:
    In the Matter of Joseph Rosenthal, Respondent, against Joseph D. McGoldrick, as Comptroller of the City of New York, et al., Appellants.
    Submitted January 16, 1939;
    decided February 21, 1939.

      William C. Chanler, Corporation Counsel (Paxton Blair and Leonard M. Wallstein, Jr., of counsel), for motion.
    A delegation to the judiciary of plenary power to appropriate and expend public funds is unconstitutional. (People v. Tremaine, 252 N. Y. 27; Matter of College of City of New York v. Hylan, 205 App. Div. 372; 236 N. Y. 594;
      Smith v. Strother, 68 Cal. 194; State ex rel. City of Fargo v. Wetz, 40 N. D. 299; Matter of Drake, 106 Penn. Super. Ct. 383; People ex rel. Wakeley v. McIntyre, 154 N. Y. 628; State ex rel. Davis v. Eggers, 29 Nev. 469; Tillotson v. Frohmiller, 34 Ariz. 394; Blaine County Investment Co. v. Gallet, 35 Ida. 102; Matter of Small v. Moss, 279 N. Y. 288.)

      Samuel Binder and Jesse C. Rogers opposed.
    The delegation of power to the trustees of the County Court library in Rings county to fix the compensation of the librarian and principal consultation and opinion clerk, was not prohibited by the Constitution of this State. (Matter of McAneny v. Board of Estimate, 232 N. Y. 377; People ex rel. Simon v. Bradley, 207 N. Y. 592; People ex rel. Cropsey v. Hylan, 199 App. Div. 218; 232 N. Y. 601; Matter of Flaherty v. Craig, 226 N. Y. 76; People ex rel. O’Loughlin v. Prendergast, 219 N. Y. 377; Matter of Bateman v. Mayor, 247 N. Y. 250; People ex rel. Wogan v. Rafferty, 208 N. Y. 451.)
   Per Curiam.

The question whether, under the Constitution, the Legislature may confer upon an administrative board or officer plenary authority to fix the compensation of its employees, or to fix other expenses incurred in carrying on public work has been authoritatively decided by this court many years ago. Authority so conferred is not a legislative power to appropriate. The Legislature, exercising the control which, under the_Constitution, it retains over the moneys of the State and of the cities of the State, merely adds one more mandatory appropriation to the list of such appropriations. It confers upon the administrative officer or board power only to determine the amount which, in the opinion of the officer or board, is required to carry out in proper manner a specified public purpose. (Matter of McAneny v. Bd. of Estimate & Apportionment, 232 N. Y. 377, 387; People ex rel. Simon v. Bradley, 207 N. Y. 592; Matter of McKinney v. McGoldrick, 243 App. Div. 210; affd., 266 N. Y. 632.) The field within which the board may act is narrow and is purely administrative though within that field the Legislature leaves discretion unfettered by any express rule or standard formulated by the Legislature.

The Legislature might, if it chose, limit the field further by providing that compensation paid by the board may not exceed a specified sum, but it is not bound to do so. Where the Legislature concludes that the public interest will be best served by conferring upon a board or officer, intrusted with a public duty, authority to determine the amount to be paid to the employees required in the proper performance of such duty, the Constitution does not prohibit the Legislature from conferring such authority. The question to be determined is narrow and clearly defined. Implicit in that question are the criteria which must govern, though the weight to be given to varying factors rests with the board or officer. Here, under the decisions of this court and the rules laid down by the Supreme Court of the United States in Panama Refining Co. v. Ryan (293 U. S. 388), there is no delegation of a legislative power, but only the conferring of an enlarged administrative power.

The rule of separation of governmental powers cannot always be rigidly applied. The exigencies of government have made it necessary to relax a merely doctrinaire adherence to a principle so flexible and practical, so largely a matter of sensible approximation, as that of the separation of powers.” The rule that the judiciary may not be charged with administrative functions does not apply when such functions are “ reasonably incidental to the performance of judicial duties.” (Matter of Richardson, 247 N. Y. 401, 410, 418, opinion by Cardozo, Ch. J.) Supervision of the courts, appointment of court officers and employees, and determination of their compensation, are, it is plain, administrative functions “ incidental to the performance of judicial duties ” and may be intrusted to judicial officers. That has never been doubted and statutes conferring such power have never been challenged.

Even in this case and its companion cases, the statutes were not challenged until this motion for reargument was made. We do not decide now whether such a challenge comes too late. We decide only that earlier decisions of this court provide answer to the challenge. The Legislature has chosen to confer upon a few judicial officers a plenary power to fix salaries of a few clerks and employees which has been denied in all other cases. We do not know why the Legislature made such distinction. Inquiry by the courts of the wisdom of legislative action would be an encroachment by the courts upon the field reserved under the Constitution to the Legislature. Mandatory appropriations, whether the amount be fixed by the Legislature or by other officers, may involve important questions of fundamental principles of governmental policy which must be determined by the Legislature. They involve no question of constitutional principle which has not been passed upon by the courts.;

Motion for reargument denied.