author: Leaking, Y. C.

text:
    Minerva P. Taylor v. Jenny E. Wright.
    [Submitted May 7th, 1909.
    Decided May 19th, 1909.]
    1. When the owner of two tenements sells one of them, or the owner of one entire estate sells a portion, the purchaser takes the tenement or portion sold with all the benefits and burdens which appear at the time of sale to belong to it, as between it and the property which the vendor retains.
    2. The principle illustrated with respect to the case of overhanging eaves and porch as a gnosi-easement reserved by implication for the benefit of the complainant as vendor.
    3. The easement in question is of the class defined as continuous.
    4. An action at law before the law court is the proper remedy for the determination of the existence or non-existence of such an easement, and the court of -chancery will -not enjoin the prosecution of such an action.
    On bill for injunction to restrain action at law.

      Messrs. Oarrow & Kraft, for the complainant.

      Messrs. Apgar & Boswell, for the defendant.
   Leaking, Y. C.

Complainant’s husband owned certain land in Ocean City, 'Cape May county, fronting on Central avenue. On this land he erected two dwelling-houses, similar in size and appearance. The houses both fronted on Central avenue and were but a few feet apart. The peak of the roof of each house was over the centre of each house and ran in a line at right angles to Central avenue, so that one-half of the roof of each house slanted towards the other house. The roofs of both houses extended beyond the line of the sides of the houses, forming eaves. The distance between the eaves of the two houses was but about thirteen inches. With the two houses thus standing side by side, and separated, as above stated, by but a few feet, and owned by complainant’s husband, defendant purchased the easternmost house. An accurate survey of the land as described in the deed from complainant’s husband to defendant discloses that the boundary line which passes between the two houses, when located on the ground, will cut off nine and eleven-sixteenths inches of the eaves and a few inches of the porch of the house not conveyed. Since the conveyance referred to was made complainant has acquired the property not conveyed by a deed from her husband through an intermediary. Defendant has now brought an action of ejectment against complainant to recover possession up to the boundary line described in the deed referred to. If recovery is had it will necessitate the removal of a part of the eaves and porch of complainant’s house. The present suit is to restrain defendant from prosecuting the suit at law.

Complainant urges that the effect of the conveyance to defendant under the conditions named charges defendant’s property with the burden of the overhanging eaves and porch as a quasi-easement reserved by implication for the benefit of complainant’s house, while defendant claims that a quasi-easement of this nature cannot be implied by way of reservation because such claim is in derogation of the terms of the grant.

The law of this state touching easements of the nature here claimed must be regarded as settled to the effect that upon a severance of title a g-wm-easement may arise by way of implied reservation as well as by way of implied grant. In Central Railroad Co. v. Valentine, 29 N. J. Law (5 Dutch.) 561, 564, the court of errors and appeals quotes, with approval, from Lampman v. Milks, 21 N. Y. 507, as follows:

“Wlien the owner of two tenements sells one of them, or the owner of one entire estate sells a portion, the purchaser takes the tenement or portion sold with all the benefits and burdens which appear at the time of sale to belong to it, as between it and the property which the vendor retains.”

On p. 56b the reasons for the rule are stated as follows: “The law preserving the rights of the parties upon a severance of ownership of the entire estate, by creating an easement in favor of the part sold or retained, according to circumstances, seems to proceed upon the idea that in the absence of an expressed intention to destroy the burden, none will be implied from the mere fact of severance.”

Other cases in this state are reviewed by Vice-Chancellor Pitney in Toothe v. Bryce, 50 N. J. Eq. (5 Dick.) 589, 605, and again by Vice-Chancellor Eeed in Greer v. Van Meter, 54 N. J. Eq. (9 Dick.) 270. In both of these cases the conclusion is reached that it must be considered as here settled that upon the severance of the tenement, a reservation of a g"is£m-easement will take place on the conveyance of the servient part whenever it would pass by way of grant on the conveyance of the dominant part.

It is also settled that such easements will only arise when they are apparent and continuous and reasonably necessary to the beneficial enjoyment of the property conveyed or reserved. Toothe v. Bryce, supra (at p. 608), and Greer v. Van Meter, supra (at p. 272).

In the present case I think the easement claimed by complainant must be regarded as of that class recognized as apparent and continuous, and as reasonably necessary to the beneficial enjoyment of the building. Assuming, as it must be assumed under the pleadings, that the parties established the boundary line where they intended to establish it, the fact that the eaves and porch of complainant’s house extended over the boundary line was apparent. It may be, as stated at the hearing, that the naked eye could not detect that the eaves extended over the boundary line; but it also appears that the porch extended over the line, and the diagram of the premises offered in evidence discloses that the eaves project from the body of the building further than the porch. Upon the assumption that the parties ■knew that the line passed across the extreme end of the porch, the fact that the eaves also extended over the line must be regarded as apparent in the sense that it was apparent to the parties. The easement is also of that class defined as continuous. In Fetters v. Humphreys, 18 N. J. Eq. (3 C. E. Gr.) 260, 266; affirmed,, 19 N. J. Eq. (4. C. E. Gr.) 471, Chancellor Zabriskie refers to overhanging roofs as an illustration of an apparent and continuous easement, as follows: “A continuous or apparent easement is either a fixture, or it is enjoyed by means of a fixture, upon the land itself. There is something visible by which it may be known to a purchaser, as an overhanging roof, open windows, a sewer, or a water pipe, actually engaged in fulfilling their duties. A right of way, a discontinuous easement of any kind, is only exercised at intervals, and is a latent encumbrance or claim, the very existence of which may depend upon uncertain and doubtful testimony.”

That the easement now in question is reasonably necessary to the beneficial enjoyment of the house of complainant also seems apparent. It may be that the overhanging part of complainant’s house can be removed and the extreme end of the porch cut off without injuring the strength of the house or unfitting it for occupation, but it is obvious that the removal of the eaves of the house will injure its appearance and value. I do not understand the rule to have been adopted in this state that the easement must be absolutely necessary to any enjoyment of the property whatever, as in the case of a way of necessity. Should the facts of the present case be reversed and the conveyance be assumed to have been from defendant to complainant, there seems to be no doubb but that complainant would be entitled to the preservation of the overhanging eaves and projecting porch as reasonably necessary to the beneficial enjoyment of the property conveyed, and, as stated in Greer v. Van Meter, supra, the same rules are applied in the case of reservation as in grant. As pointed out in Central Railroad Co. v. Valentine, supra (at p. 567), the intention of the parties must be understood from the language of the deed when applied to the subject-matter, and the intention of the parties to destroy the apparent and continuous conveniences will not be understood to have existed unless that intent is distinctly expressed.

The evidence at the hearing disclosed that it was the probable intention of the parties to establish the line at a point half way between the two houses. Had the bill been for reformation of the deed with that issue presented by the pleadings, that evidence would have been competent and might have entitled complainant to relief on that ground. The issue of reformation or mistake is not, however, presented by the present pleadings, and it also seems probable that the fact that complainant has, since the execution of the deed, suffered defendant to extend a bay window up to the line described in the deed, may now operate to bar relief by reformation.

I have given this expression of my views touching the issues presented because the jurisdiction of this court has been in noway challenged, except by the single objection that relief should not be here granted until after a judgment should have been entered in favor of the plaintiff in the pending action in the law court. But notwithstanding the fact that no objection to the jurisdiction is pending I feel obliged to recognize what I deem to be the well settled limitations of the jurisdiction of this court.

If the easement here asserted by complainant exists, it arises from well-defined rules of law and is a legal as distinguished from an equitable estate or interest. While this court has frequently recognized and protected rights of the nature here claimed, the occasion has uniformly arisen from a threatened permanent invasion of rights which, if permitted, would occasion irreparable injury. In the present case there is no such threatened invasion of any rights which complainant may possess, but on the contrary defendant has brought an action at law for the recovery of possession, and in that action the legal rights of complainant here asserted will, if they exist, afford a complete defence. That tribunal is the proper tribunal to determine the existence or non-existence of an easement or other legal estate in lands, and this court cannot properly determine an issue of that nature except to such extent as may be necessary to prevent, irreparable injury. In Hart v. Leonard, 42 N. J. Eq. (15 Stew.) 416; Outcalt v. Helme Co., 42 N. J. Eq. (15 Stew.) 665, and Todd v. Staats, 60 N. J. Eq. (15 Dick.) 507, the court of errors and appeals has clearly defined the limitations of the jurisdiction of this court in enforcing or protecting legal rights in real estáte. To here enjoin defendant from prosecuting his action at law is to interfere with the law court in the discharge of its primary jurisdiction. That the rights asserted by complainant are purely legal rights is, I think, entirely clear. In Valentine v. Central Railroad Co., 29 N. J. Law (5 Dutch.) 60; S. C., Id. 561, rights emanating in a similar manner as those asserted by complainant are treated as legal rights. See also Stuyvesant v. Woodruff, 21 N. J. Law (1 Zab.) 133.

I am obliged to advise an order dismissing the bill for want of jurisdiction; but as no demurrer has been filed I think no costs should be taxed. Dan. Ch. Pl. & Pr. 542.


source: Caselaw Access Project

license: Public Domain

text:
    Aaron T. Hageman v. Charles G. Brown and Roberta Brown.
    [Submitted May 18th, 1909.
    Decided May 21st, 1909.]
    1. Complainant in equity must allege with particularity every material fact which it is necessary for him to prove to establish his right to the relief prayed.
    2. Where complainant seeks equitable relief on the ground of fraud, his bill must state the facts constituting the fraud, so that the person against whom relief is sought may have full opportunity to deny or explain the facts charged, and disprove them.
    3. Where a creditor’s bill sought to reach certain money belonging to defendant alleged to have been secretely hidden in real estate purchased in the name of another in a specified manner, with a fraudulent purpose of placing it beyond the reach of creditors and preserving it for defendant’s use by means of a secret trust, the manner in which the bill charged that the fraud was accomplished was a material part of complainant’s cause of action, which defendant was required to specifically answer with fullness and particularity.

      4. That a bill to reach property held for defendant under an alleged secret trust was not a bill for discovery and contained no interrogatories, would not exempt defendant from answering fully and specifically all the material averments of the charging part of the bill.
    5. The object of a complainant in waiving oath to the answer to a bill in equity is merely to deprive the defendant of his right to have the answer treated as evidence in his favor.
    G. Defendant in equity is bound by admissions in his answer without oath.
    On exceptions to answer of defendant Charles G-. Brown.
    The purpose of the bill in this suit is to procure a decree declaring the equitable title to certain real estate to be vested in defendant Charles G. Brown, the legal title to which now stands in the name of his daughter Roberta Brown, to the end that the real estate may be subjected to the lien of a certain judgment held by complainant against defendant Charles G. Brown. The bill charges that Roberta Brown, the daughter who holds the legal title, has no beneficial interest in the premises, but holds the same in trust for her father with the intent and purpose of defrauding complainant and other creditors of the father, and preventing them from, collecting their claims against the father, and charges that the consideration for the conveyance to the daughter moved from the father and not from the daughter. In amplification of this general charge of fraud, the bill specifically sets forth the manner in which the legal title to the property was placed in the name of the daughter. The specific averment is that defendant Charles G. Brown made an agreement with one Mary A. Moffett, the former owner of the property, whereby he agreed to purchase the property for a certain amount, and that in the performance of that agreement he paid to the vendor the purchase price so agreed upon and caused the deed to be made to his daughter Roberta. . The specific averment is also made that of the money so paid a certain specified amount was money due to him from one Alfred S. Brown, which money was paid by Alfred S. Brown to the vendor at the request of and for and on account of defendant Charles G. Brown as a part of the said purchase price; and that a certain further part of the purchase price was paid to the vendor by the said Alfred S. Brown as a loan to defendant Charles G-. Brown, and that the repayment of the latter amount was secured to Alfred S. Brown by a mortgage on the premises executed by the daughter Roberta at the request of her father. The answer filed by defendant Charles G. Brown states that the agreement for the purchase of the property was made by him as agent and attorney in fact for his daughter, at her request and for her benefit, and that she is the sole owner of the legal and equitable title. The answer also contains the following denials:
    “This defendant denies that the consideration moved from the said defendant Charles G. Brown to the said Mary A. Moffett as alleged in the bill of complaint filed in this cause.
    “This defendant denies that the title to said described premises in said bill of complaint filed in this cause was put in the name of Roberta Brown at his request for the purpose of defrauding his creditors and hindering and defrauding them in the collection of their just claims against him.
    “This defendant denied that the said Roberta Brown holds the title of said premises described in said bill in trust for him or that he has any beneficial interest in the premises whatever as alleged in said bill of complaint filed in this cause.”
    Complainant has excepted to the sufficiency of the answer by reason of its failure to answer in detail the specific averments of the bill above set forth touching the manner in which the purchase price of the property was raised and paid.
    Defendant insists that he is excused from answering specifically the detailed averments of the bill touching the manner in which the purchase price of the property was raised and paid, and is privileged to answer generally to the effect that the consideration did not move from him, because these specific averments of the bill are matters of evidence, because the bill is not a bill for discovery and contains no interrogatories, and because the bill asks for an answer without oath.

      Mr. Paul Q. Oliver, for the complainant.

      Mr. George Ball, for the defendants.
   Leaking, Y. C.

I am convinced that the exceptions to the answer must be sustained.

1. There are probably few rules of equity pleading more firmly established than the requirement that every material fact which it is necessary for a complainant to prove to establish his right to the relief he asks must be alleged in the premises of his bill with fullness and particularity, and that a suitor who seeks relief on the ground of fraud must state the facts which constitute the fraud, so that the person against whom relief is sought may be afforded a full opportunity to deny or explain the facts charged, and also to disprove them. Smith's Administrator v. Wood, 42 N. J. Eq. (15 Stew.) 563, 566. This bill, in effect, seeks to reach certain money belonging to defendant, which money has been by defendant secretly hidden in certain real estate, in the manner specifically set forth in the bill, with the fraudulent purpose of placing it beyond the reach of creditors and preserving it for his own use by means of a secret trust. The manner in which the bill states that this was secretly accomplished forms a part of the alleged fraudulent transaction, the averment being, in effect, that a third party paid the monejq but that the money so paid was in fact money which the third party owed to defendant; the facts so stated are specific and definite facts which are material to complainant’s case. In this view it seems clear that defendant cannot be excused from specifically answering these detailed averments of materia] facts under the claim that they are evidentiary in their nature. I regard the general averments contained in the bill to the effect that the consideration moved from defendant, which averment defendant has answered by a general denial, as more .nearly a general statement of a conclusion of law than a specific statement of concrete facts. Had the averments in question been added to the present bill in the form of interrogatories, I think the necessity of specific answers to the interrogatories would not be questioned.

2. The fact that the bill is not a bill for discovery and contains no interrogatories, will not exempt defendant from answering fully and specifically the material averments of the stating part of the bill. The rule, as stated by Judge Story, is as follows:

“One of the principal ends of an answer upon the part of the defendant is, to supply proof of the matter necessary to support the case of the' plaintiff; and it is therefore required of the defendant, either to admit, or to deny, all the facts set forth in the bill, with their attending circumstances, or to deny having any knowledge or information on the subject, or any recollection of it, and also to declare himself unable to form any belief concerning it. And this he ought to do fully and explicitly even though no special interrogatories should follow the bill. But, as experience has proved, that the substance of the matters charged in the bill may frequently be evaded by answering according to the letter only, it has become a practice to add to the general requisition, that the defendant should answer the contents of the bill, a repetition, by way of interrogatory, of the matters most essential to be answered, adding to the inquiry after each fact, an inquiry of the several circumstances, which may be attendant upon it, and the variations, to which it may be subjected, with a view to prevent evasion, and compel a full answer.” Story’s Bq. PI. § 35.

This privilege of adding special interrogatories to a bill has not, so far as I am aware, except where controlled by court rules, been given the effect to absolve, in any manner, a defendant from the primary duty of answering all of the material averments of the bill. The bill in this case prays that defendants “may, without oath, full, true and perfect answer make to each and every of the matters and things above set forth, as fully and particularly as if the same were here again repeated and they thereto particularly interrogated.” I understand the rule in this state to be substantially as stated in Methodist Episcopal Church v. Jaques, 1 Johns. Ch. 65, as follows:

“I apprehend the rule on this subject to be that it is sufficient to make this general requisition on the defendant to answer the contents of the bill, and that the interrogating part of the bill, by a repetition of the several matters, is not necessary. The defendant is bound to deny or admit all the facts stated in the bill, with all their material circumstances, without special interrogatories for that purpose. Mitf. Pl. Coop. Eq. Pl. 11, 12. They are only useful to probe more effectually the conscience of the party, and to prevent evasion or omission as to circumstances which may he deemed important; but it is no excuse for the defendant, in avoiding to answer fully to the subject-matter of the bill, that there were no special interrogatories applicable to the case.”

. 3. The foregoing is equally true where the bill prays for an answer without oath. The object of a complainant in waiving oath is merely to deprive the defendant of the advantage of his answer as evidence for himself. A defendant is bound by his admissions in his answer without oath. In Reed v. Cumberland Insurance Co., 36 N. J. Eq. (9 Stew.) 393, Chancellor Eunyon says:

“He [complainant] has a right to the • defendant’s answer on every material point, though he waives oath. Eor he is spared the necessity of proof as to all matters admitted by the defendant. The latter is bound by his admissions in the answer, though put in without oath.”

My conclusion is that the bill entitles complainant to a specific answer as to whether at the time of the conveyance from Mary A. Moffett to Eoberta Brown, Alfred S. Brown owed defendant Charles G. Brown certain money and paid the money so owing to Mary A. Moffett on account of the purchase price of the property in question for or on account of and at the request of defendant Charles G-, Brown; and as to whether the remaining portion of the purchase price referred to in the bill was paid to Mary A. Moffett by Alfred S. Brown as a loan to defendant Charles G. Brown, or for or on account of or at the request of defendant Charles G. Brown.

I will advise a decree sustaining the exceptions to the answer.


author: Leaming, Y. C.

text:
    Arnold Kohn v. Samuel H. Kelly et al.
    [Submitted May 28th, 1909.
    Decided June 8th, 1909.]
    Upon the foreclosure of an usurious mortgage the defendant is entitled to a credit on the principal of the interest payment made in excess of the legal rate.
    On bill to foreclose usurious mortgage.

      Mr. Lewis Starr, for the complainant.

      Messrs. Bourgeois & Sooy, for the defendants.
   Leaming, Y. C.

The single question here presented is whether our statute against usury entitles defendant to a deduction from the amount actually loaned of all interest which has been paid by him, or only entitles him to a deduction of the amount of illegal interest paid by him.

I am unable to consider this an open question in this state. In all cases in which the subject appears to have been directly considered the view has been uniformly adopted that the statutory deduction from the amount actually loaned of interest already paid is of the interest which has been paid in excess of the legal rate. Pond v. Causdell, 23 N. J. Eq. (8 C. E. Gr.) 181; Bedle v. Wardell, 25 N. J. Eq. (10 C. E. Gr.) 349; Terhune v. Taylor, 27 N. J. Eq. (12 C. E. Gr.) 80; Mahn v. Hussey, 28 N. J. Eq. (1 Stew.) 546; Boyd v. Engelbrecht, 36 N. J. Eq. (9 Stew.) 612; Pfenning v. Scholer, 43 N. J. Eq. (16 Stew.) 15; Hintze v. Taylor, 57 N. J. Law (28 Vr.) 239.

In Lowenthal v. Myers (not reported) I ordered an interest payment credited on the principal of a usurious mortgage, and the court of errors and appeals appears to have affirmed that part of my decision. 72 Atl. Rep. 80. The language of the statute touching interest payments already made was not brought to my attention in that case, and I think it reasonable to assume that the appellate court made a similar oversight, for I am entirely satisfied that the latter court would not have intentionally departed from its former views without some expression of the reasons for so doing.

I will advise a decree for complainant for $5,000, less the interest payment made in excess of the legal rate, and without costs.


text:
    Annie A. Redrow v. J. Katherine Sparks et al.
    [Submitted and decided June 21st, 1909.]
    1. In the foreclosure of a purchase-money mortgage which has been given to a vendor by the vendee mortgagor for all or a part of the consideration of a deed of conveyance for the same premises containing covenants of warranty of title or against encumbrances, the vendee mortgagor may be allowed a deduction, by reason of the covenant against encumbrances contained in the deed, .for prior mortgages, taxes, assessments or judgments; relief may also be given the vendee mortgagor by reason of the covenant of title contained in the deed if there has been an eviction by title paramount; relief may also be given in such case for fraud; or for the conveyance of less land than bargained for; the foreclosure may also be arrested pending an action at law to try the title of an adverse claimant. No relief can be given the vendee mortgagor on his assertion of an outstanding title when there has been no eviction and no action is pending to enforce it; in such case the vendee mortgagor will be left to his remedy at law on the covenants.
    2. The right of rescission of a contract must be asserted within a reasonable time; the retention of the benefits of the contract is inconsistent with the assertion of that right.

      3. A defect of title which has been removed before final hearing and which has caused no damage to the vendee, affords no ground for relief of the vendee mortgagor in a suit to foreclose a purchase-money mortgage. But in such case partial relief may be given against costs.
    On bill to foreclose and cross-bill.

      Mr. G. Dore Cogswell, for the complainant.

      Mr. Joseph J. Summerill, for the defendant.
   Leaking, Y. C.

The defences available to a mortgagor in resisting the foreclosure of a purchase-money mortgage which he has given to his vendor for all or a part of the consideration of a deed of conveyance to him for the same premises containing covenants of warranty of title, or against encumbrances, are considered by Vice-Chancellor Stevens in Kuhnen v. Parker, 56 N. J. Eq. (11 Dick.) 286, and the adjudications in this state in cases of that class are there collected. It will be observed that where there is a covenant against encumbrances, the mortgagor may be allowed a deduction for prior mortgages, taxes, assessments or judg ments; where there is a covenant of title and there has been an eviction by title paramount, relief may be given to the mortgagor; relief may also be given when the mortgagor has been defrauded; or has by mistake obtained less land than he bargained for; the foreclosure may also be arrested pending action at law to try the title of an adverse claimant; but no relief can be given to the mortgagor on his assertion of an outstanding title where there has been no eviction and no action is pending to enforce it. In the latter case the mortgagor will be left .to his remedy at law on the covenants.

In the present case the cross-bill asserts fraudulent representations upon the part of complainant which, if sustained, might afford ground for equitable relief. The evidence, however, discloses no fraud. Any representations which may have been made touching the title were innocently made. Cross-complainant conceded this upon the witness-stand, and other evidence fully established the fact.

At the hearing cross-complainant was permitted to treat his cross-bill as amended, touching all matters relating to damages sustained by her from any cause, and complainant was permitted to treat her bill as supplemental by the averments of matters which had transpired touching the title after the original bill was filed. The evidence fully established that all defects of title had been cured prior to the time of the hearing. The evidence touching damages received by cross-complainant by reason <:i the removal of buildings or the want of repair of the premises was insufficient to either warrant a rescission of the contract or to establish a right to an offset or allowance against the mortgage. Had cross-complainant sought a rescission of the contract that remedy should have been applied for earlier; possession was taken after the buildings weie removed, of which complaint is now made, and the premises were occupied a year without complaint of the absence of the buildings referred to, or of the want of repair of the buildings; any right of rescission which may have existed by reason of want of repair or loss of buildings must be regarded as having been waived; the sale of timber from the property had a like effect. The evidence does not satisfy me that any fraudulent representations touching either the character or extent of the buildings were in fact made, and neither the written contract nor the deed of conveyance contain any covenant of that nature. Had there been any representations which included the idea that the roof of the house was in good repair, I think some complaint would have been made when it was found to be otherwise. I think it may have been understood by the parties that a chicken-house was to remain on the premises; but the cost of a new chicken-house was not proven, even if it be assumed a proper offset.

I am also unable to discern any reason for denying a decree because of defects of title existing at the time the bill was filed, which defects were then unknown to the parties and were removed before the time of the hearing. As already stated such defects have been held to afford no defence to foreclosure until adverse rights are asserted; but assuming that relief could be granted cross-complainant in this court by reason of the defects of title referred to, as the defects have been removed before final decree, no relief is now practicable, for no substantial damages have been sustained by cross-complainant by reason of the defects complained of. In specific performance cases by a vendor a good title at final decree is usually held sufficient. Oakey v. Cook, 41 N. J. Eq. (14 Stew.) 350, 364; Moore v. Galupo, 65 N. J. Eq. (20 Dick.) 194, 198; Agens v. Koch, 70 Atl. Rep. 348. In the present case the title was promptly perfected when the defects were discovered.

I think, however, that cross-complainant is equitably entitled to be relieved from such costs as have accrued that would not have accrued had the title been perfect when the bill was filed. The evidence discloses with reasonable clearness that after the bill was filed a client of Mr. Summerill would probably have loaned cross-complainant the necessary money to discharge the mortgage and stop the foreclosure had the title been found marketable, and that the loan failed because of the title defects. In view of this fact I think complainant should recover the taxed costs incident to the filing of the bill and issuing and serving the subpoenas and no more, unless cross-complainant makes it necessary to issue an -execution, in which case the costs of decree and all subsequent proceedings may be properly taxed.

I will advise a decree for complainant for the amount of the mortgage with interest to the date of the decree, together with the costs above referred to.


author: Leaming, Y. 0.

text:
    Patrick Fitzgerald v. State Mutual Building & Loan Association.
    [Decided May 9th, 1909.]
    1. In the distribution of assets among the stockholders of an insolvent building and loan association neither the owners of stock known as “full paid stock” nor owners of stock known as “advance payment stock” are entitled to preferment as such.
    2. Nothing either in the statute or by-laws contemplates that such stock shall become preferred stock in the sense that such stock shall be entitled to preferment in the distribution of assets at dissolution, or that its holders shall become general creditors of the association as distinguished from stockholder members.
    3. Neither are the holders of stock on which notices’ of withdrawal have been given entitled to preferment in such case.
    4. The only equitable plan for distribution of the assets of such association is the pro rata division of the assets among all of the stockholders, giving to each share of stock a value, for purposes of distribution, of the amount paid on it.

      Mr. Thomas E. French, Mr. Samuel K. Robbins and Mr. George J. Bergen, for the receivers pro se.

      Mr. Ilarvey F. Carr, for sundry stockholders.

      Mr. Ralph E. Bum, for sundry stockholders.
   Leaming, Y. 0.

The receivers of defendant building and loan association now desire to make a partial distribution of assets among the stockholders of the insolvent association, and to that end have brought in all parties in interest that it may be determined, among other things, whether certain stockholders are entitled to preferment in the distribution of assets. As the assets of the association will be insufficient to pay the full amount paid in by its members, it becomes necessary to ascertain whether certain stock is entitled to priority of payment over other stock. The present contest arises by reason of the claim of preferment made by the owners of stock who gave notice of withdrawal before the suspension of the business of the association, and also a like claim made by owners of certain stock known as "full paid stock” and certain other stock on which "advance payments” have been made. The advance payments are authorized by section I of the constitution of the association, which section permits any stockholder to pay in advance money on account of his installments of dues and entitles the person so paying to receive a certain discount for the advance payments. The "full paid stock” is authorized by section 8 of the constitution. That section authorizes a stockholder to pay $100 per share for his stock and entitles the person so paying to receive a certain rate of interest on the amount paid until the stock of that series matures. The right of withdrawal is conferred by section 9 of the constitution and the terms of withdrawal are set forth in article 4 of the by-laws, and in sections 38 and 39 of an act of the legislature approved April 8th, 1903. P. L. 190S ¶. Jf&7. Of the full paid stock there are nine hundred and forty-five shares; of these, thirty-eight owners of one hundred and twenty-eight shares have given notice of withdrawal and two hundred and twenty-six owners of the remaining eight hundred and seventeen shares have not. Of the "advance payment stock” there are ten thousand one hundred and forty-one shares. Of these, two hundred and ninety-six owners of five thousand three hundred and five shares have given notice of withdrawal, and eight hundred and sixty-seven owners of the remaining four thousand eight hundred and thirty-six shares have not. Of the remaining stock of the association, that is, stock on which no advance payments have been made, there are seventeen thousand and fifteen and one-half shares. Of these, eight hundred and eighteen owners of two thousand one hundred and nine shares have given notice of withdrawal, and two thousand three hundred and sixty-seven owners of the-remaining fourteen thousand nine hundred and six and one-half shares have not. The evidence discloses that some time prior to two years before the suspension of business the association began to receive a great number of withdrawal notices and that the withdrawals continued thereafter in such numbers that during the two years- prior to suspension loans on real estate security were practically discontinued. During that period but three loans were made on real estate security: one in April, 1905, for $1,600; one in July, 1905, for $1,000, and one in August, 1905, for $250. The only loans made during that period, except as above stated, were what was known as “stock loans;” these are described as loans to members exercising the right to borrow ninety per cent, of the withdrawal value of their stock by pledging their stock as security. Many members borrowed in this manner because they could not procure their money by withdrawal without waiting a long time. During the two years referred to the withdrawal notices accumulated until at the date of suspension the withdrawal notices unpaid amounted in the aggregate to $232,143.88. Payments on withdrawal notices were made in the order in which the notices were filed and at the date of suspension applications for withdrawals to the amount of $172,779.22 had been on file more than six months. At the hearing an examination was also made of the assets and liabilities of the association as of the date of its annual statement about two years before its suspension of business. If the testimony of the receivers as to the value of the real estate can be regarded as reasonably accurate, the value of the assets of the association two years prior to its suspension had become less than the amount at that time paid in by its members.

There appears to be no reasonable ground for the contention that either the “full paid stock” or the “advance payment stock” is entitled to preferment as such. Only one kind of stock is contemplated by the charter act or by-laws. The provisions above referred to touching full paid stock and advance payments of dues are mere privileges given alike to all stockholders. Such payments are payments on stock, and in no sense loans to the association. The consideration for the advance payments of dues and for the full payments on stock passes at the time of payment to the same extent as all other payments on stock. hTothing in either the statute or by-laws contemplates that the stock so issued shall become preferred stock in the sense that such stock shall be entitled to preferment in the distribution of assets at dissolution or that its holders shall become general creditors of the. association as distinguished from stockholder members. The decisions of the courts appear to be practically uniform in the adoption of this view. People v. New York B. & L. Ass’n, 110 N. Y. App. Div. 554; People v. Metropolitan Mut. B. & L. Ass’n, 103 N. Y. App. Div. 153; Forwood v. Eubank (Ky. App.), 50 S. W. Rep. 255; Solomons v. Am. B. & L. Ass’n, 116 Fed. Rep. 676; Hohenshell v. Home B. & L. Ass’n, 140 Mo. 566; Leahy v. National B. & L. Ass’n, 100 Wis. 555. Furthermore, the Building and Loan Association act of 1903 (P. L. 1903 p. 1¡57) expressly forbids the issuance of preferred stock. Section 53 of that act provides as follows:

“No such association (building and loan association) shall issue preferred stock or other than common stock, and all shareholders shall occupy the same relative status as to debts and losses of the association.”

It also seems entirely clear that no claim of preferment upon the part of stockholders who have given notice of withdrawal can be sustained, so far as such claim is based upon the provision of the by-laws touching withdrawals. The by-laws provide that “at no time shall the association be required to pay out on withdrawals more than one-half of the monthly receipts of dues.” The evidence discloses that in every month during the last two years of the life of the association more than one-half of the dues were paid for withdrawals, and in almost every month the amount paid for cash withdrawals exceeded the amount received for dues, and this is also true even when advance payments on stock and payments for full paid stock are treated as dues of the month in which such pajments were received. The aggregate amount received during the two years named for dues, including advance payments and payments for full paid stock, was $342,-447.72, whereas the amount paid for cash withdrawals during the same period was $442,368.07. These payments were made on withdrawal notices in the order of their dates. It thus appears that at the time of dissolution no payment was due under the terms of the by-laws on any withdrawal notice. It has, I think, been uniformly held that the right of withdrawal does not exist except as conferred by a by-law or statute, and when so conferred the right will be restricted to the terms of the by-laws or statute. Miers v. Columbia Mut. B. & L. Ass’n, 157 Fed. Rep. 940; Rabbitt v. Wilcoxen, 103 Iowa 35; Heinbokel v. National S. L. & B. Ass’n, 58 Minn. 340.

But in the year 1903 a general act was passed touching building and loan associations. P. L. 1908 p. 157. Sections 38 and 39 of that act relate to the subject of withdrawals. The latter section provides:

“Withdrawals shall be paid in the order in which the notices thereof are received, but not more than one-half the receipts of any one month shall be required to be used for payment of withdrawal claims, without the consent of the board of directors, until the oldest of such claims then unpaid shall have been on file for a period of six months; but in no case shall payment be postponed for a period longer than six months from the date of such notice, and any shareholder who has given the said notice may sue for and recover the withdrawal value of his'shares in any such association in any court of competent jurisdiction, if the same is not paid in six months from the date of the giving of said notice of withdrawal.”

As already stated a part of the withdrawal notices in question had been on file over six months at the time of suspension, while others had not. It is not easy to determine what this statute may contemplate by the use of the word “receipts.” The inquiry, however, does not appear to be material, because the statute requires all notices on file six months to be paid irrespective of the amount of receipts, and the notices on file less than six months would not have been reached had one-half of all receipts from all sources, including dues, interest, premiums, fines, advance payments on stock, moneys received for full paid stock and loans repaid to the association been applied to the payment of the withdrawal notices. More than one-half of the moneys received from all sources was, in fact, applied to the payment of withdrawals, although it does not appear that any resolution was adopted by the board of directors consenting thereto. As none of the notices of withdrawals which had been on file less than six months were payable either under the terms of the by-laws or the terms of the statute, it follows, as is shown by the cases last above cited, that they cannot be regarded as preferred claims.

The only doubt which I entertain is touching rights which may have arisen under notices which had been on file over six months at the date of suspension; but independently of the considerations already stated, I am convinced that neither the claim based on notices filed less than six months nor those based on notices filed more than six months can be now properly treated as entitled to preferment in the distribution of assets. There may be some question as to whether the statute of 1903 can be regarded as superseding the by-laws so far as the rights of stockholders prior to that date are concerned, for rights accruing under the by-laws partake of the nature of contractual rights between the several members; but I think the conclusion just stated must be reached even though the statute be regarded as controlling as to all stockholders. As already stated the right of a stockholder to “withdraw” by surrendering his shares and withdrawing money in lieu of them and in that manner to terminate his membership, is derived from the by-laws of an association, or from a statute if the subject is controlled by statute. In either case the rights, privileges and liabilities flowing from the proceeding must be ascertained from the by-law or statute controlling the subject. The question is therefore essentially one of statutory construction. The English decisions construe a by-law or rule which confers the right of withdrawal with peculiar strictness, and while they recognize that the notice of withdrawal does not terminate the membership of the stockholder giving notice nor constitute him a creditor of the society in an unrestricted sense, yet they treat his claim as entitled to preferment at dissolution. See Walton v. Edge, 10 App. Cas. 33; Sibun v. Pearce (1890), 44 Ch. Div. 354; In re Sunderland Society (1890), 24 Q. B. Div. 394; In re Ambition Building Society (1896), 1 Ch. 89. The Sunderland Case, however, gives recognition to the rule of construction that the by-law or statute conferring the right of withdrawal may not contemplate the exercise of the right except while the society “was or was believed to be” still solvent. While the decisions in this country cannot be said to be uniform, the view appears to be generally adopted that upon the distribution by a court of equity of the assets of an insolvent building association among its stockholders the by-laws or statute which confers the right of withdrawal will be understood to have reference to the general mutual and equitable scheme of such association and to presuppose that at least a relative proportion of the assets will remain for the benefit of those who continue to be active members of the association. In this view it is held that notices of withdrawal which have matured after the association has reached an insolvent condition are not entitled to preferment of payment at dissolution. Some of the decisions go even further, and hold that independently of the fact of insolvency át the time a withdrawal notice is given or matures, the basis of distribution is not the rule of the association expressed in a by-law or statute, standing alone, but the supreme rule of equality and mutuality. The following are among the cases adopting the views stated: Reddick v. United States Building and Loan Association, 100 Ky. 94; Christian’s Appeal, 102 Pa. St. 184; Walker v. Terry (Ala.), 35 So. Rep. 466; Rabbitt v. Wilcoxen, 103 Iowa 35; Hohenshell v. Home Savings Association, 140 Mo. 566; Reitz v. Hayward, 100 Mo. App. 216; Fort Smith Building Association v. Cohn, 75 Ark. 497; Alexander v. Southern Horne Building and Loan Association, 110 Fed. Rep. 267; Coltrane v. Baltimore Building and Loan Association, 110 Fed. Rep. 272; Colin v. Wellford, 102 Va. 581; Manheimer v. Henderson Building and Loan Association (Ky.), 72 S. W. Rep. 313. See, also, 6 Cyc. 165; End. Build. Asso. (2d ed.) §§ 108, 514, 515.

The General Building and Loan Association act of 1903, of which the sections already referred to touching withdrawals form a part, will be found to contemplate throughout its provisions the central idea of co-operation, equality and mutuality upon the part of the members of the association. That part of section 53, already quoted, which provides that “all shareholders shall occupy the same relative status as to debts and losses of the association” is but in harmony with the general plan of the act. The general plan of the act being as stated, I am unable to believe that sections 38 and 39, relating to withdrawals, were intended by the legislature to be applicable to associations which should have reached an insolvent condition. I entertain the view expressed in the Goliraine Case, already cited, that these provisions touching withdrawals, like the other provisions of the act, are obviously intended and are equitably applicable only so long as the association is a going concern from which all the members may ultimately hope and expect to receive approximately equal benefits. In the ascertainment of the legislative intent, I do not think it proper to ignore the obvious fact that if the sections referred to are held to apply to insolvent associations and to entitle its withdrawing members to be paid in the order in which their notices of withdrawal are given, the practical result will inevitably be to afford a means of preferment for those who are in the best position to know the true condition of the association to the exclusion of the poor and ignorant. I do not think that such a plan can be reasonably said to have been within the contemplation of the legislature. It is true that the act gives to a withdrawing member, whose notice of withdrawal has been on file over six months, a right of action for the “withdrawal value of his shares.” But the statute does not contemplate that the withdrawal value of shares can in any case exceed the proportionate part of the assets of the association represented by the shares. That amount the receivers are willing to pay when the assets are reduced to cash, first deducting the cost incident to reducing the assets to cash. But the holders of stock on which notices of withdrawal have been given demand full payment in the order in which the notices have been filed. What amount they demand is not by them specified. The testimony touching the assets of the association discloses with reasonable certainty that no 'share of stock now in question would have been entitled, at the date of the notice given for its withdrawal, or at any subsequent date, to receive the full amount paid in on it, had there been applied to the share the full proportionate part of the assets of the association. The statute says:

“If the withdrawal be made within the first year, the withdrawal value of the shares withdrawn shall be not less than .the sum of the subscriptions or dues paid on such shares, less all unpaid fines and a proportionate share of any loss sustained by the association; after the first year, a reasonable share of the profits shall be included in the withdrawal value and shall be paid to the withdrawing shareholder.”

Whether the provision for payment “after the first year” also contemplates deduction of a proportionate share of the losses is not clear, but I apprehend the meaning to be that if stock is withdrawn during its first year it shall not share in the profits, but may do so if later withdrawn, and that all withdrawn stock shall bear its share of losses. Assuming that to be the meaning of the statute, I doubt whether it is possible to now ascertain the withdrawal value of the several shares of stock of which notice of withdrawal has been given, if they are to be treated as preferred and are to be paid in the amount of their withdrawal value in the order in which notices of withdrawal has been given. As already shown, more than one-third of the entire stock of the association, which is owned by about one-third of its members, is under notices of withdrawal. In my judgment, the only equitable plan for distribution of the assets of the association is the fro rata division of the assets among all of the stockholders, giving to each share of stock a value, for purposes of distribution, of the amount paid upon it.

The status of a withdrawal notice at dissolution appears to be an open question in this state. In Silvers v. Merchants Saving Fund and Building Association, 56 Atl. Rep. 294 (not officially reported), Vice-Chancellor Grey gave to a withdrawal notice the effect of constituting the owners of the stock a general creditor of the association and entitling him to preferment at final distribution by a receiver in insolvency. In the later case of Whitehead v. Commonwealth Building and Loan Association (file number, 25-302), Vice-Chancellor Pitney reached the contrary conclusion. No opinion was filed by the learned vice-chancellor in the case last referred to, but I am informed that his decision was reached after a full argument and careful review of the adjudicated cases, including the Silvers Case above referred to. I know of no other case in this state in which the court has been called upon to determine the status of withdrawal notices in the distribution of assets among stockholders.

My conclusion is that the statutory right of a member of a building and loan association to withdraw from membership and to receive the withdrawal value of his shares and the statutory privilege to sue for the amount if it is not paid within the time named in the statute, is based upon and forms a part of the general plan that each member is entitled to equal participation in the assets, and that the statute does not contemplate that the privileges named shall be exercised to defeat equal participation, and that the spirit of the statute being equal participation, the paramount equity is equal participation at all times; and when the association has reached a condition in which the value of its assets is less than the amount which has been contributed by its members as dues, the equitable right of equal participation cannot be defeated by a course of management which will bestow upon withdrawing members, by an artificial and erroneous assumption of withdrawal values, an unequal share of the assets. As no losses are shown to have been sustained during the period between the date of the oldest withdrawal notice now on file and the date of suspension of business, except such losses as may have arisen by the payment to prior withdrawing members of more than their equal share, the present claimants under withdrawal notices, if now treated the same as other members, will receive, with the exception noted, substantially the same amount that they would have received had the suspension of business occurred at the date of the oldest notice.

I will advise a decree of equal distribution.


author: Leamtng, Y. C.

text:
    Defiance Fruit Company v. Thomas C. Fox Thomas C. Fox v. Defiance Fruit Company et al.
    [Submitted July 14th, 1909.
    Decided July 16th, 1909.]
    1. A riparian proprietor is entitled to have the stream discharge its waters in its natural course and in its natural way, except to the extent to which a lower riparian proprietor having constructed a dam across the channel has acquired a prescriptive right to interrupt the natural flow.
    2. Evidence reviewed, and held to require a finding that defendant had obtained a prescriptive right to raise the water of a stream by means of a dam only to a height three inches below the level claimed by him.
    On bill and cross-bill.

      Mr. Henry S. Alvord, lor the complainant.

      Mr. George J. Bergen and Messrs. Qarrow ■& Kraft, for the defendants.
   Leamtng, Y. C.

On October 26th, 1905, a bill was filed by Defiance Eruit Company (hereinafter referred to for convenience as “the company”) for an injunction to restrain Thomas C. Eox (hereinafter referred to as “Eox”) from raising the water in his mill pond at Willow Grove, Few Jersey, to a height which was alleged to injure a cranberry bog on the land of the company situate above the mill pond on either side of a natural stream which flows into the pond. Eox answered asserting that he and his predecessors in title had maintained the water, in the pond at the height complained of for over twenty years prior to the date of the filing of the bill. When the cause came on for final hearing, it was ascertained that the issues involved were purely legal rights, the existence of which were in substantial dispute, and this court, in consequence, refused to entertain jurisdiction until the legal rights in dispute were determined at law; the bill was, however, retained, pending a proposed action at law, because of the absence of any denial of equity jurisdiction on the part of defendant. Accordingly the company brought an action of trespass against Eox, and after trial a verdict was rendered in favor of defendant. Thereafter the company brought another similar action at law against Eox, and before the trial of that action Eox, by leave of this court, filed, in the original equity suit, a cross-bill in the nature of an original bill in which the history of the litigation up to that time was recited and the suits at law were alleged to be vexatious, and the company and others in interest were made parties to the end that this court should make a decree determining the level to which the water in the mill pond could be lawfully maintained. The several defendants to the cross-bill answered and joined in the prayer of the cross-bill that this court determine the level at which the waters of the pond could be lawfully held by the mill owner.

The mill pond is formed by a dam which interrupts the flow of a natural stream known as "Scotland Branch,” and the cranberry bog of the company is on either side of that stream a mile or more above the dam. The dam has been maintained by Eox and his predecessors in title for upwards of fifty years, and the two mills now owned and operated by Eox have during that time been supplied with power from the -waters of the pond.

The testimony adduced at the hearing, and especially when considered in connection with a view of the premises made by me at the request of the respective counsel, leaves no doubt in my mind but that, with the water in the pond maintained at the height at which Eox claims the right to maintain it, the natural and beneficial flow of the stream passing through the property of tlie company is interrupted and interfered with by the back water occasioned by the dam in a manner and degree which materially injures the property of the company. This fact is so manifest that I think it unnecessary to enter upon a discussion of the evidence further than to state that the level at which Eox claims the right to maintain the water' in the pond is above the level of the bed of the stream passing through the company’s bog; when this level is raised to the extent necessary to enable the stream to discharge the Avaters which flow down it under normal conditions—about six inches—the Avater overflows the banks of the stream at the lower or southerly portion of the bog and also prevents proper drainage of other parts of the bog. In other words, the water of the pond, when maintained at the level at which Eox claims the right, operates to interrupt the natural flow of the stream through the company’s land and to back water on its bog.

It is entirely clear that the company is entitled to have this stream discharge its waters in its natural course and in its natural Avay except to the extent to which Eox has established a prescriptive right to interrupt the natural flow. As the right of Eox to thus interfere Avith the natural and beneficial flow of the stream through the company’s property is claimed by him to exist by prescription, and as both parties have joined in the prayer for this court to determine the level at which Eox may lawfully maintain the waters of his pond, the difficult task has been undertaken to ascertain the conditions which have existed, during the tAventy years preceding the commencement of this suit. The inquiry has necessitated the examination of a great number of Avitnesses touching early conditions, and, as may well have been anticipated, the testimony is in radical conflict in many respects. At the conclusion of the hearing the respective counsel joined in a request that I should view the premises and should also make independent investigations of my oato, assisted by an engineer of my oavu choice, and a written stipulation of that nature has been filed. This unusual course has been adopted by reason of the extreme difficulty in ascertaining the exact truth touching many things concerning which the testimony Avas in conflict or was incomplete which could be accurately ascertained by a view and measurements or demonstrations in my presence. I have accordingly visited the premises twice in the presence of respective counsel and have been assisted by a millwright of my selection employed by the respective counsel for that purpose. The investigations which I have made on the premises in dispute in the presence of respective counsel, have been of great service to me in determining the force to be properly given to much of the testimony, and while I somewhat doubt the propriety of pursuing this course in ordinary cases, I am fully convinced that it is the best course which could have been adopted in this case to insure the highest practicable degree of accuracy of conclusions.

The level at which Eox claims the prescriptive right to maintain the waters of the mill pond is marked on a horizontal string-piece which forms the top or cap of the wing of a bridge at the easterly end of the dam. This string-piece is not quite level and the water of the pond submerges the northerly end of the string-piece first. When the northerly half of the string-piece is submerged and the southerly half of .the upper surface of the string-piece is still exposed, the water is at the level at which Eox claims it has been maintained for a working head during the twenty years next preceding the commencement of this suit. In the upper surface of the string-piece referred to, about midway between its ends, a nail is driven to designate the point at which the water of the pond will stand when at the working head claimed by Eox. A number of witnesses have testified touching this string-piece, and assert that it has been where it now is for more than twenty years, and that the level of the centre of the upper surface of that timber represents the level at which the pond has been held for working purposes during all of that time, whenever sufficient water could be held .in the pond to maintain that level. Other witnesses assert to the contrary, and some testimony indicates that this string-piece was placed where it now is less than twenty years ago. It is urged that the abutment of the bridge with which the end of this string-piece connects was washed away within twenty years, and that any string-piece there at that time was necessarily removed or changed. A number of other witnesses fix the level of the pond during the past twenty years by the statement that the pond was always maintained, when sufficient water could be had, at about the level of what is known as the Dare lot. The Dare lot is the sideyard of a house known as the Dare house. This house stands near the southeast corner of the mill pond; the land between the pond and the house was the sideyard of the Dare house. The testimony of a number of witnesses is to the effect that the water has always been maintained at about the level of that sideyard; that the aim was to keep the pond as full as it could be without overflowing the Dare lot between the house and pond; that in freshets the lot would sometimes be overflown before the flood gates could be raised. < The part of the Dare lot referred to is now surfaced with gravel which has been placed there within a few years, but the amount of gravel placed there is in dispute. It is urged in behalf of Eox that but a few loads of gravel have been placed on the Dare lot. The surface of this gravel is now about the level of the water in the pond when the water is at the level of the nail referred to. Other witnesses have pointed out that back of the barn in the rear of the Dare house a “frog-pond” or “scow-hole” existed in the early days by reason of water flowing into , it from the pond. With the water in the pond two inches below the nail I found the water running from the pond into this depression, at the i ime of one of my visits to the pond. A number of other witnesses, with various objects to assist their memory, were quite positive that for twenty years past and more the water of the pond has been maintained as high as it now is when at the level of the nail referred to. Other witnesses have been equally positive to the contrary. Along the course of the stream between the pond and the company’s property above, dead cedar trees, standing with their roots and part of their trunks submerged with water, are pointed out as indicating that the trees could not have grown in water of such depth. On many of these trees the bark remains intact, and the testimony is that the bark of a dead cedar tree will not remain longer than ten or fifteen years. There are, however, similar dead cedar trees without bark. Photographs of the vegetation along the entire course of this stream have been introduced in evidence. It has also been shown in behalf of the company that the bridge, already referred to, which, passes over a canal at the easterly extremity of the dam, has been twice elevated. This canal leads to one of the mills of Fox—the saw mill—and supplies the water power for that mill. A road overseer testified that in 1896 he raised the bridge six inches by adding six inches of stone to the top of the stone abutments; on top of the stone which he added he placed a two-inch plank and the bridge was made to rest on the two-inch plank. That since then the bridge appears to have been raised six inches more by placing a six-inch plank on the two-inch plank. An examination of the bridge verifies the testimony of Mr. Albertson to the effect that, with the water in the pond at the level of the nail, the water at this time is at the level of the point of contact between the stone and the two-inch plank referred to. It follows that if the road overseer added six inches in height to the stone abutments and the water was prior to that time maintained at the level of the nail, it was maintained six inches above the stone work of the abutments. Testimony also exists to the effect that the dam has been raised during the past twenty years; but this is in turn denied. With the water at the level of the nail, it is about as near the top of the dam as it can be-safely maintained; at worn places the water extends partly in the roadway which crosses the dam. Testimony also exists to the effect that the water did not formerly cause trouble at the bog of the company, but that it now operates to severely injure the bog.

As already stated, two mills are supplied with power by the waters of the pond. One is now operated as a saw mill and has been referred to. The other is a grist mill and receives its water through a flume or fore-bay passing through the dam some fifty yards or more westerly of the canal referred to. Formerly, each of these mills was equipped with an old-fashioned “undershot” or “low-breast” wheel. In 1889, less than twenty years before the commencement of this suit, these wheels were removed and turbine wheels were installed in their stead. The millwright who installed the turbine wheels testified that the working-head of the old wheels was four and one-half feet, and that he placed the new wheels for use with the same working-head. The “working-head” referred to represents the vertical distance between the level of the water in the tailrace, with the mill running, and the level of the water in the pond. An accurate measurement of the working-head of the grist mill discloses that with the water in the pond at the level of the nail referred to, the working-head is four feet ten and eight-tenths inches, or four and eight-tenths inches more than the working-head of the old wheels, if the millwright, who renewed the old wheels, was correct in his statement of the old working-head. Other witnesses also testified that four and one-half feet was the working-head of the old wheels. There can be no doubt of the accuracy of the measurements of the present working-head with the pond at the nail level. The measurement was twice taken—on different days—in my presence and in the presence of counsel, with both mills running at full capacity in order that the greatest possible amount of back water in the tailrace could accumulate. I do not regard this excess over four and one-half feet of working-head as conclusive evidence that the water, when maintained at the level of the nail referred to, is four and eight-tenths inches higher than it was used before the turbine wheels were installed, for the witnesses of Mr. Eox, who testified to the former working-head of four and one-lialf feet may not have been entirely accurate, but when taken in connection with other testimony and with features yet to be referred to, it is strongly indicative of a former level of the pond below that now claimed.

As already stated, a number of witnesses, who testified in behalf of Eox, stated that for over twenty years the pond has been maintained as high as it could be without overflowing the yard between the pond and the Dare house. To ascertain to what extent the Dare lot has been raised by the gravel referred to, three test holes were dug through the gravel at distant points into the soil below. The gravel was coarse, yellow gravel, packed and hardened, and the under surface of the gravel was almost as plainly marked as its upper surface. At the lines of demarcation, between the gravel and the soil below it, pins were inserted and levels were then run from the nail in the string-piece, which marks the level of the pond claimed by Eox as its ancient level to the three pins marking the bottom side of the gravel. The levels thus run, with a transit in my presence and in the presence of counsel, disclosed that the bottom of the gravel at the first test hole was two and twenty-eight hundredths inches below the level of the pond; at the second test hole, three and forty-eight hundredths inches below the level of the pond; at the third test hole, three and ninety-six hundredths inches below the level of the pond. In other words, if the gravel should be removed from the Dare lot the water of the pond would, when maintained at the height claimed as its ancient height, be about three inches deep on the Dare lot between the pond and the Dare house. As this gravel was admittedly placed on the Dare lot in recent years, it is manifest that the pond could not have been maintained at its present level twenty years ago without flooding the Dare lot, if the bottom of this gravel can be accepted as the former surface of that lot, and the testimony is, as already stated, that the Dare lot has not been flooded, except in freshets occurring before the flood gates in the dam could be raised to lower the water.

Twenty years ago there stood at the edge of the mill pond in question an ice house in which ice from the pond was stored. The ice house is no longer there, but the “lifts” with which the ice was hoisted from the pond are still, in part, in place. The cakes of ice were floated onto these lifts and hoisted to a point at which they were deposited in the main ice house. The sill on which the lifts rested when down is still in place. The lifts were produced and offered in evidence as exhibits. As the testimony of witnesses touching measurements of the depth of water over these lifts differed, remeasurements were made in my presence. The depth of water above the upper surface of the sill, on which the lifts rested when down, was found to be twenty-six inches when the water in the pond was at the level of the string-piece nail. The lifts, two in number, are constructed with a bottom framework on which the cakes of ice rest; lateral uprights are secured to the bottom framework; these lateral uprights are connected by a horizontal cross-piece under which the cakes of ice must pass when floated on the lifts. The bottom frameworks of the lifts are one and three-quarter inches in thickness; the distance in the clear from the bottom framework to the cross-piece, is twenty and one-half inches. It will thus be seen that with the lifts resting on the sill above ^referred to, ready to receive cakes of ice, the lower surface of the cross-pieces of the lifts, under which the floating cakes of ice would need to pass, would be three and three-quarter inches below the surface of the water of the pond if the pond was at the level contended for by Eox. It may have been practicable to operate these lifts with their bottom framework raised several inches above the sill to receive cakes of ice, and thus enable the floating cakes of ice to pass under the horizontal cross-piece, but as the lifts were operated by horsepower, I think otherwise. I think that the mechanism above described may be reasonably said to indicate that it was intended to conveniently receive ice from a pond in which the water was at least three inches below the height now asserted by Eox as the ancient height.

It is now necessary to refer to the construction of the two penn stocks. When the water of the pond is at the nail level referred to, the water in the penn stock of the saw mill is within a fraction of an inch of its top; where uneven places exist in the upper surface of the top sheathing planks of the penn stock the water overflows; no higher head of water could be utilized. At the grist mill the penn stock appears to have been originally constructed with a framework of eight by eight upright timbers resting on transverse sills of the same dimensions. At the rear end of the penn stock an eight by eight timber connects the upper ends of the two rear corner upright timbers. Inside of and against these upright timbers is the horizontal sheathing of the penn stock, the lateral sheathing extending to within one inch of the level of the-top of the rear eight by eight horizontal frame or cap timber above referred to. On top of this rear eight by eight cap timber is a four by six timber. This timber operates to raise the height of the rear end of the penn stock four inches, and does not appear to have performed any office in the original construction. To raise the sides of the penn stock even with the top surface of the four by six timber a two by five sheating plank is added. The effect of the four by six end timber and the two by live sheathing plank is to enable the penn stock to hold five inches more water than it could hold before these additions were made. It cannot be stated with positiveness that these additions were made since the penn stock w'as first constructed, but such is the appearance. With the water in the pond at the level of the nail referred to, the water in this penn stock of the grist mill is at the line of contact of the horizontal eight by eight and four by six, and is five feet seven and two-tenths inches above the bottom of the penn stock: This would be one inch above the top of the sides of the penn stock if the upper two by five sheathing plank were removed. It does not seem reasonable to suppose that these two open penn stocks would have been constructed with no margin of height above the level at which the water in the mill pond was intended to be maintained; the natural and reasonable inference is. that the level of the water in the pond which these penn stocks were constructed to serve was lower than the level of the nail referred to which marks the working-head now claimed by Eox.

Another feature of the construction of the grist mill penn stock should be referred to. On the easterly side of this penn stock there is a horizontal framework timber extending from the second to the fourth upright eight by eight timbers referred to, and mortised into these two uprights. The intermediate eight by eight upright is mortised into the bottom of this horizontal framework timber. This horizontal framework timber is old and its upper surface decayed; the upper surface is eight inches below the level of the water in the pond when at the level of the nail referred to. While this timber may have formed a part of the upper framework of the old penn stock which has been superseded by the present one, I think that fact too uncertain to warrant any conclusion based on that assumption.

The testimony disclosed that the present turbine wheels which were, as heretofore stated, installed less than twenty years ago to take the place of horizontal undershot or low-breast wheels, economizes water to the extent of about twenty to twenty-five per cent. That is, the same power is obtained by the use of less water. As the testimony shows that it was found difficult to store enough water to hold the pond at or near the full head with the old wheels in use, it follows that with the new wheels performing the same duty as the old, the tendency would be to increase the level of the water maintained in the pond.

After a careful consideration of all the evidence, I am fully convinced that the level of the water in the pond, as it is now sought to be maintained, is higher than it was formerly maintained or used, and that the water has not been maintained or used at the present level for a period twenty years next prior to the commencement of this suit. I reached this conclusion from the evidence before I viewed the premises or made the independent investigations which have been referred tod The view which I made of the premises has fully confirmed that conclusion. But without a view of the premises I doubt whether I could have reached a satisfactory conclusion as to the amount which the water has been raised during the twenty years referred to. Using the information gained by a view of the premises in connection with the testimony taken at the hearing, I am now fully convinced that twenty years next before, the commencement of this suit, the water in the pond was not and could not be maintained or used at a higher level than three inches below the level now claimed by Eox, which latter level is marked by the nail in the centre of the upper surface of the string-piece or cap wharf log at the southeast corner of the pond. This distance of three inches below the nail referred to will, in my judgment, represent with reasonable accuracy the level at which Eox has acquired a prescriptive right to maintain the water in the pond. There are so many features of the case which lead me to these conclusions that it seems impossible to escape them or to doubt their accuracy. The testimony touching the raising of the dam; the testimony touching the raising of the bridge to the level of the road on the dam; the construction of the old ice house lifts and the mechanism for their operation; the condition of the vegetation along the stream between the pond and the company’s property above it; the height at which the back water from the dam causes the water to rise on the company’s property; the level of the Dare lot below the gravel covering; the present working-head of the mills; the height of the penn stocks of the mills as at present constructed; the conservation of water by the present turbine wheels, all indicate an increased head of water, and many of the features named indicate an increase of head of about and not less than three inches.

I will advise a decree fixing a point three inches below the level of the upper surface of the string-piece already described at the point where its surface is intersected by the nail referred to as the height at which the water in the pond may be lawfully maintained. Levels have been run from this nail to an elevation bench mark at Newfield, established by the Pennsylvania Railroad Company, and that bench mark has in turn been checked with elevation bench marks established by the United States government. I think it important that the level mark designated in the decree should be permanently fixed by checks of the nature referred to or by some other satisfactory method. If the respective counsel will agree upon the method of designation of the level to be specified in the decree, I will advise a decree so framed.


author: Leaking, V. C.

text:
    Jacob Muller v. Adon W. Muller, administrator, &c., of John Muller, deceased.
    [Submitted October 4th, 1909.
    Decided October 14th, 1909.]
    1. In a suit by one administrator against his co-administrator for the recovery of money alleged to be due complainant from intestate in his lifetime for services rendered and merchandise supplied, and also for the recovery bf money paid by complainant for funeral expenses, upon a motion to strike out such portions of the bill as refer to such matter on the ground (1) of uncertainty, and (2) because within the jurisdiction of the orphans court, respectively—Held (1) that as the bill primarily seeks to establish a debt from the intestate to the complainant as administrator, which is disputed by his co-administrator, the suit is properly brought in this court; and (2) as respects the claim for services and merchandise the rules of equity pleading require complainant to give defendant full information in such a manner as to apprise him of the times when and the nature of the labor performed, and the kind and extent of the merchandise delivered, and when delivered, these being matters peculiarly within the complainant’s knowledge, and of which defendant is presumptively ignorant.
    2. Since rule 213 was adopted a motion against a bill for uncertainty is entertained of the same force as a demurrer upon like ground.

      On motion to strike out portions of bill.

      Mr. David 0. Watkins, for the complainant.

      Mr. Francis B. Davis, for the defendant.
   Leaking, V. C.

This suit is brought by one administrator against a co-administrator for the recovery of money alleged to be due complainant from intestate in his lifetime; and also for the recovery of certain money paid by complainant for funeral expenses of intestate. Defendant moves to strike out the parts of the bill relating to the services and expenditures referred to and assigns for ground of the motion that the averments of the bill relating to money due from intestate in his lifetime are insufficient for want of certainty, and the parts of the bill relating to money due for funeral expenses are insufficient for the reason that the charges referred to may be adjudicated by the orphans court where settlement of the estate is pending.

As the bill primarily seeks to establish a debt due from intestate to the administrator, which debt is disputed by the co-administrator, the suit is properly brought in this court. Petty, Administrator, v. Young, 43 N. J. Eq. (16 Stew.) 654. The joinder of the claim for funeral expenses is proper for the reason that Dhe jurisdiction of this court being properly invoked for the purposes named, this court may appropriately ascertain the entire indebtedness due from intestate’s estate to complainant.

That part of the bill which sets forth the claim of complainant for money due from intestate in his lifetime is as follows:

*

“That the said John Muller (intestate), in his lifetime, was indebted unto your orator in a large sum of money, to wit: the sum of four thousand, six hundred dollars, for nursing, board, washing and for goods, wares and merchandise furnished and delivered the said John Muller, in his lifetime, by your orator, at the special instance and reguest of the said John Muller, in his lifetime.” ,

The motion against this portion of the bill is upon the ground:

“That the said allegations do not specify at what period of time in. the lifetime of the said John Muller he was indebted to the complainant in the sum of four thousand, six hundred dollars, nor how much of said sum is due complainant for board, how much for washing, how much for nursing nor how much for merchandise furnished.”

It is a rule of equity pleading that the averments of the-bill must contain a degree of certainty which will give to defendant full information of the case he is called upon to answer. Mutual Life Insurance Co. v. Sturges, 33 N. J. Eq. (6 Stew.) 328, 337; Arnett v. Walsh’s Executors, 46 N. J. Eq. (1 Dick.) 543; 1 Dan. Ch, Pl. & Pr. *368, and note to the effect that the rights o£ the several parties, the injury complained of, and every other necessary circumstance, as time, place, manner or other incident, ought to be plainly, yet succinctly, alleged. The objection that the bill is deficient for want of certainty may be taken-by demurrer to the bill. 1 Dan. Ch. Pl. & Pr. *368, *372. Sincérale 213 of this court has been adopted a motion against the bill for' uncertainly is entertained of the same force as a demurrer upon like ground.

It is manifest that the test of sufficiency as to certainty must, in a large measure, depend upon the circumstances of the particular ease. In the language of Lord Thurlow in Phillips v. Phillips, 4 Q. B. Div. 127, “It depends upon the good sense of the thing.” Thus, in Watson v. Murray, 28 N. J. Eq. (8 C. E. Gr.) 257, it was held that averments in a bill which would ordinarily be objectionable for uncertainty were sufficient against the demurrer by reason of the fact that the bill was one for discovery, and that the matters touching which the bill was challenged for uncertainty were matters the source of information of which were entirely within defendant’s possession. In the present case, the contrary condition exists, as this suit is for thSrecovery of money for services performed for intestate and for merchandise supplied to him in his lifetime, which are matters peculiarly within the knowledge of complainant, and of which-the defendant is presumptively more or less in ignorance as to-details. Under these circumstances, I think it is clear that the defined rules of equity pleading require complainant to give defendant full information of the case he is called upon to answer in such manner as to apprise lrim of the times when and the nature of the labor performed, and the kind and extent of the merchandise delivered, and the times when delivered.

A third objection to the bill is based upon an error in the bill which is conceded to exist and to be the result of ’inadvertence.

■ I will advise an order sustaining the motion against the bill and allowing complainant twenty daj^s in which to file an amended bill.