text:
    Margaret May Sweeney v. Carroll Francis Sweeney.
    [Filed December 16th, 1901.]
    1. Upon the petition of a wife for a divorce on the ground of her husband’s desertion of her in a foreign country, where the marriage took place and a matrimonial domicile had been maintained up to the time of the alleged desertion (the husband not having been served with process nor appearing), if the proofs show that petitioner’s residence in this state was acquired without the animus manendi except for such period as would permit her to claim a right to file a petition under our Divorce law, or if the proofs leave the question of the bona fid.es of the residence in this respect in doubt, this court will not assume jurisdiction to dissolve the matrimonial status.

    2. Proof that the husband left the house in which he and his wife lived, without doing'any act or uttering any word indicative of an intent not to return, and that the wife has never since seen or heard from him, is not sufficient to establish an intent to desert and to continue his desertion, in the absence of proof from which it may be found or inferred that he remained alive and free and able to return if he had desired to do so. Such absence is not thereby sufficiently shown to be a willful and obstinate desertion for which a divorce may be decreed.
    On exceptions to master’s report.

      Messrs. McEwan & McEwan, for the exceptant.
   Magie, Chancellor.

The report excepted to advised the denial of the decree of divorce prayed for by the petition, upon a single ground, viz., that petitioner had not acquired or maintained a residence within this state for the period of two years, during which the desertion complained of (which commenced in Cuba) continued, sufficient to give jurisdiction under our laws.

In my judgment the proofs which accompany the master’s report amply justify his conclusion on this subject.

It appears therefrom that the petitioner and defendant were married in the year 1893, in the island of Cuba. Where the previous residence of the defendant had been is not disclosed, but the proofs clearly show that the parties acquired, and afterwards maintained, a matrimonial domicile in Cuba, up to the time of the alleged desertion. Harral v. Harral, 12 Stew. Eq. 279. The time of the desertion is fixed, by petitioner’s deposition, as January 18th, 1896, when the parties were living at the house of petitioner’s father, in Havana. On February 10th, 1896, petitioner left Cuba, and remained absent until the following May, .when she returned to Havana, to the house of her father. In the early part of April, 1898, she came, with her mother, to Jersey City, to the house of her aunt, and remained there until July 2d, 1898. While there, and on April 24th or 25th, she proposed to her aunt that the latter should permit her to take a room in her aunt’s house as her residence. The aunt assented to this proposal.

Petitioner claims that she thereby acquired, and has since maintained, a residence in Jersey City, and was resident there when her petition was filed, in July, 1900.

The jurisdiction of this court to decree a divorce from the bonds of matrimony, upon the ground of desertion commenced in a foreign state, where the matrimonial domicile was, can only be invoked, under the express provisions of our law, when one of the married parties is a resident of this state at the time of filing the bill, and has been such a resident for the term of two years, during which the desertion complained of has continued. Coddington v. Coddington. 5 C. E. Gr. 263; Yates v. Yates, 2 Beas. 280; Brown v. Brown, 1 McCart. 78; McGean v. McGean, 15 Dick. Ch. Rep. 21; Tracy v. Tracy, 15 Dick. Ch. Rep. 25.

In such cases the bill or petition should state facts showing the jurisdiction of the court. Barrett v. Barrett, 10 Stew. Eq. 29. The facts evincing jurisdiction must be proved. If the proofs leave the jurisdiction, in serious doubt, the court will not assume jurisdiction. Goldbeck v. Goldbeck, 3 C. E. Gr. 42; Firth v. Firth, 5 Dick. Ch. Rep. 137.

The residence required by the statute to enable the court to assume jurisdiction must be the fixed domicile or permanent home. Coddington v. Coddington, ubi supra; Firth v. Firth, ubi supra. When the domicile or residence is shown to have existed in a foreign state, and the claim is that the party invoking jurisdiction has become a resident of this state, the proof must show a voluntary change of residence to this state, and an actual residence at the place selected; to the factum of residence must bo added the animus manendi. As was declared by Mr. Justice Depue, speaking for the court of errors, “that place is the domicile of a person in-which he has voluntarily fixed his habitation, not for a mere temporary or special purpose, but with a present intention of making it his home, unless, and until, something which is uncertain and unexpected shall happen to induce him to adopt some other permanent home.” Harral v. Harral, ubi supra; Firth v. Firth, ubi supra; Tracy v. Tracy, ubi supra.

Since a change of residence is evinced by an actual change of habitation, continued with a purpose and intent to make the new habitation a permanent residence for an indefinite and indeterminate period, the court whose jurisdiction is invoked by one who claims to have acquired and maintained such a new residence, must consider, not only the acts and conduct of the claimant, but also whatever tends to indicate the animus with which the change was made. Declarations accompanying the acts and characterizing the conduct may be considered, and the court cannot arbitrarily and capriciously refuse credit to the uncontradicted evidence of the claimant in respect to such intent. But, in general, acts and conduct afford more trustworthy proof upon the question than do the declarations of the claimant, and if the latter are inconsistent with the former, it may justify a determination against the residence claimed, or create such doubt or uncertainty as to require jurisdiction to be refused. Firth v. Firth, ubi supra.

In the October Term of 1861 Chancellor Green declared his opinion to be that an actual residence adopted in this state, under circumstances that warrant the conclusion that the change of residence was made for the purpose of obtaining a divorce, would not, on grounds of public policy, satisfy the language of our act properly construed. This doctrine led him to refuse a divorce to a person who had been deserted in New York, and had-obtained an actual residence here, but with the purpose of invoking the jurisdiction of our courts. Brown v. Brown, 1 McCart. 78. The decree in that case was reversed by the court of errors, in March Term, 1862, but the reporter, in a foot-note, regrets that he could not publish the opinion of Chief-Justice Whelpley, read by him in pronouncing the judgment of the court. Brown v. Brown, 2 McCart. 499. In Coddington v. Coddingion, ubi supra, Chancellor Zabriskie declared that it was well understood that one ground for the reversal of the decree in Brown v. Brown was that the chancellor had held that an actual change of residence, although seemingly for the purpose of bringing a suit for divorce, was not sufficient, under the requirements of our act in respect to jurisdiction. Yet, notwithstanding the reversal in that case in 1862, we find Chancellor Green, in 1863, adhering to the same opinion, and making it a ground for refusing jurisdiction. Winship v. Wenship, 1 C. E. Gr. 107. In McGean v. McGean, ubi supra, Vice-Chancellor Pitney refused to take jurisdiction in a case where he found that the petitioner, who sought a divorce on the ground of desertion in New York, had come to this state, under advise of counsel, and for the avowed purpose of seeking a divorce from our courts. His view was that such a change of residence was not bona fide, and did not entitle petitioner to claim relief here. The decree in that case was affirmed in the court of errors upon another ground, but Mr. Justice Gummere, who delivered the opinion of the court, declared .that the evidence left the question of the bona fides of the residence of the petitioner in considerable doubt, which seems to indicate that, in the mind of the learned judge, bona -fides was a necessary ingredient in' the acquisition of a residence to confer jurisdiction. McGean v. McGean, 49 Atl. Rep. 1083.

I strongly incline to the view that the true construction of the act does not compel this court to open its doors to the complaint of citizens of other states, who come to this state to obtain a relief which is unattainable in the states in which they have been injured, but deem it unnecessary to put this case on that ground, which may be deemed to be doubtful, under the decisions above referred to.

In Tracy v. Tracy, ubi supra, Vice-Chancellor Pitney expressed the view that when the circumstances proved were inconsistent with the purpose of the change of residence testified to by petitioner as being an intent to make New Jersey her home, the animus manendi was not established so as to justify the assumption of jurisdiction. The decree denying the relief sought in that case was reversed by the court of errors, on the ground that the proofs did show the acquisition of residence such as the statute required as a ground of jurisdiction. But the learned judge who delivered the opinion of the court apparently approved of the doctrine of this court in McGean v. McGean, supra, refusing jurisdiction on the ground that the avowed purpose of seeking a residence in New Jersey was to enable the complainant to obtain the relief in our courts which she was advised that she could not obtain in the courts of her previous residence, and distinguished that case from the one in hand, on the ground that in the latter there was no such purpose, and that petitioner’s testimony that she intended to make this her permanent home was uncontradicted. He uses this language, however: “But if he [the party seeking to induce our court to take jurisdiction] goes with the avowed object of living there to secure a -standing on which to found a judicial proceeding, a violent presumption would arise that the animus of remaining was not definite, but was largely determinate upon the termination of such procedure, and that an actual and bona fide residence has not been obtained.”

Accepting this as the prevailing opinion of the court of errors, I observe that, in my judgment, it is applicable not only to cases where the change of residence is made with the avowed purpose of seeking a divorce in our court, but also to cases where the proofs justify the conclusion that such was the actual though not tire avowed purpose. This conclusion will be strengthened if the proofs fail’ to show that the residence was intended to be permanent, or if they show that it was acquired for a definite time.

Turning now to the proofs before the master, three observations may be made: (1) the petitioner, in her deposition, fails to expressly declare her intent to make her permanent home in New Jersey for an indefinite period; (2) there is, I will not say suppression, but at least omission to prove facts which might tend to elucidate the purpose of petitioner, and (3) there is evidence which justifies the conclusion that petitioner acquired the alleged residence for a fixed period substantially coincident with the statutory periods necessary for jurisdiction and made no provision for future residence.

The language of the petitioner, when the master examined her (as he properly did), was as follows:

“My reason for taking up my residence, in 1898, in Jersey Oity was because of the war. All American citizens were obliged to leave Cuba— and, also, on account of self improvement—I wanted to take up certain studies here—also to improve my health. X did not take up my residence in New Jersey at that time merely for the purpose of obtaining a divorce. At that time I intended to live and make my home in Jersey Oity. Since that time Jersey Oity has been my place of residence.”

It is impossible to deny that the language of petitioner is appropriate to a residence for a definite period, and does not necessarily indicate a residence acquired for an indeterminate or indefinite period. It was, as she says, acquired because of the war in Cuba, because of self improvement in the way of .study and health, and not merely for the purpose of obtaining a divorce. After the alleged residence was acquired she remained with her aunt about two months. Whether she occupied the particular room which she claims as residence during that period is not made clear. Since July, 1898, she has not occupied it at all-except by leaving some clothing there; but she has, during all that time, actually resided with her mother and, when in Jersey City, in another house.

The proofs show that petitioner’s father, at the time petitioner’s aunt agreed to her proposal to take a room in the aunt’s house, contracted with the aunt to pay petitioner’s board when she occupied the room, and to pay for the room when she did not occupy it. The amount' of the compensation to be thus paid might throw some light upon the transaction, but no evidence-was given upon that point.

At the interview between petitioner and her aunt, at which the arrangement was made, her father and mother were present. Her father agreed to pay board for petitioner when occupying the room and to pay compensation for the room when she did not occupy it. The father has not been called as a witness. The mother, in describing the contract made, uses this language:

“I do not think there was anything- said in regard to the time, except that she was to reside permanently in Jersey Oity for the next two-years.”

Others present at the same interview testify that they heard no limitation of time named, but the mother’s testimony is not thereby contradicted, and cannot be disregarded.

These proofs will perhaps justify the conclusion that the alleged residence was acquired with the main and predominant intent to enable petitioner to seek relief in this court for the-desertion she complained of. But without reference to that phase of the case, I feel bound to say that they either show that petitioner had not, at the acquisition of the alleged residence, the animus manendi in New Jersey which is essential to give-jurisdiction to this court, or at least leave the matter in such serious doubt that jurisdiction ought not to be assumed therein.

Upon another ground I think the decree asked for should not be granted. That ground is that the proofs fail to clearly show a willful or obstinate desertion.

Petitioner testifies that defendant went away from the house-of her father in Havana, in which she and he had been living for some time, on January 18th, 1896, and that she has never seen or heard from him since. The proofs indicate that he was a man of dissipated habits, and had frequently before gone away and remained some days. After leaving in January, 1898, he had not returned when, about three weeks afterwards, petitioner left Cuba and went to Porto Eico on a visit, remaining there until the following June. There is no proof of any word said by defendant on the day he left, 'from which it can be inferred that he then intended to desert her. • There has been shown no •act, such as taking with him his clothing or belongings, from which such inference can be drawn. His continued absence is all that is given to us to characterize his acts and determine his intent. There is no proof whether search for him was made by petitioner, or her family, during his absence, nor whether, after she left her father’s house on February 10th, he returned to •find her gone, nor any other matter to help to determine what his intent was in going away and remaining away.

A divorce for desertion cannot be granted unless the act of desertion is willful, and its continuance is obstinate. When the facts proven will equally justify' some other inference, that inference which establishes matrimonial dereliction, ought not to be drawn. On the facts placed before the master, an inference of death would perhaps be as justifiable as the inference of matrimonial desertion. An inference that he, after leaving, had been rendered unable to return bjr an attack of some disease, or by aberration of mind, or by arrest and forcible imprisonment in Havana, then in a state of internal disorder, is quité as justifiable as the inference that he left home where he had been supported and cared for, however unworthy his conduct was, with the intent to sever his relations with his wife and to cease to have the benefit of a home. The case, in this aspect, differs from that of Sargent v. Sergent, 9 Stew. Eq. 644, cited for petitioner. In that case, as appears from the opinion in this court (6 Stew. Eq. 204), the husband, after leaving his wife without uttering a word or doing any act to evince the intent to desert her, was shown by the proofs, to continue to live supported, at least in part by contributions made by her, by medium of a friend of his, and she, very shortly after his leaving, had interviews with him. From this it appears that he was able to return and seek a renewal of the matrimonial slaius. That he did not do so for the period of two years, entirely justified the inference that his ■original leaving and continued absence were with the intent to ■desert. Such desertion was plainly willful and obstinate.

Upon either ground I think the decree must be refused and the petition dismissed.


source: Caselaw Access Project

author: Mache, Chancellor.

license: Public Domain

text:
    Louis Hanneman et al. v. Matilda Richter et al.
    [Filed December 24th, 1901.]
    1. To a bill, one purpose of which was a partition of lands to which-complainants claimed title under a will set out in the bill, a defendant filed a demurrer on the ground that, by the true construction of the will,, complainants had no title in the lands.—Held, that there was thus disclosed a dispute in respect to title which should be settled at law before-this court should proceed to a partition. Quaire. Whether, upon such a pleading, the bill should be retained until the title has been settleu at law.
    2. Where such a bill also seeks discovery and relief upon charges that a person who, by complainants’ construction of the will in question, was a tenant in common, and who, at her death, by her .will, had devised her interest so that complainants were entitled to a share thereof, and upon further charges that the demurring defendant had such last-mentioned will in her possession or under her control and refused to produce and prove it, or to permit complainants to do so —Held, that upon a demurrer to the bill in respect to such relief, this court was bound to construe the will in question and determine whether complainants had a right to the discovery prayed.
    On demurrer.

      Mr. Charles II. Hartshorns, for tlie complainants.

      Mr. Charles J. Roe, for the demurrants.
   Mache, Chancellor.

The bill in this ease- was filed by Louis Hanneman as the surviving husband of Amanda Hanneman, deceased, nee Ludemann,. and by Elsie Louise Hanneman, the sole heir-at-law of the said Amanda Hanneman, deceased.

One purpose of the bill is the partition of lands in the county of Hudson.

The bill charges that the lands in question belonged to one-Henrietta Ludemann, who died in January, 1878, leaving a will which is set out in full in the bill. Complainants claim that the testatrix thereby devised the lands in question to her two daughters, viz., Amanda, who became the wife of Louis Hanneman and the mother of Elsie Louise Hanneman and Matilda, who married one Richter, who has since died, and Hermina Elizabeth King, or Koenig, testatrix’s sister, so that each of the said devisees became seized of a one-third part as tenant in common with the others.

The bill shows the death of Amanda Hanneman and of Hermina Elizabeth King.

To this bill Matilda Richter, who was made a defendant, has demurred upon the ground that by the true construction of the will of Henrietta Ludemann, complainants have no title to the lands in question and consequently no right to a partition thereof.

In the argument, counsel for demurrant has insisted that, by the will of Henrietta Ludemann, the title to the whole of the lands in question is vested in Matilda Richter as the survivor of her sister and her aunt.

If this defendant had answered the bill and set up a title adverse to that of complainants, or disputed their title making discovery of her title, -or showing wherein complainants’ title is defective, as was said by Chancellor Williamson to be the proper mode of pleading (Lucas v. King, 2 Stock. 277), a ease would be presented in all respects like that dealt with in this court in Manners v. Manners, 1 Gr. Ch. 384. In that case Chancellor Pennington declined to proceed with a partition on the ground that the title to the lands sought to be partitioned was in dispute and should be settled at law before partition was decreed. The practice thus indicated has been followed in this court and approved in the court of errors, as will appear from the cases collected. Slockbower v. Kanouse, 2 Dick. Ch. Rep. 481.

If the sole object of this bill was a partition of the lands in question, I think I should be obliged to refuse to proceed- in the cause, though it might be open to discussion whether I should, upon demurrer, retain the bill to permit the title to be settled by appropriate proceedings at law.

The bill, however, has another purpose. Complainants charge that Hermina Elizabeth King died leaving a will whereby she devised her interest in said lands to her two nieces, viz., Amanda, under whom complainants claim, and Matilda Eichter, the demurrant. It further charges that Matilda Eichter has that will in her possession or under her control and that she refuses to present the same for probate, or to permit complainants to do so. Upon these charges complainants pray that Matilda Eichter may be decreed to produce and deliver up the will to be proved and recorded.

In this aspect this is a bill for discovery and relief, appropriate thereto, and to the partition otherwise prayed.

But it is obvious that complainants’ right to discovery depends upon the construction of the will of Henrietta Ludemann. If, by the terms of that will, Hermina Elizabeth King became tenant in common of an undivided one-third of the lands in question, then, upon the charge that at her death she devised one-half of her share to her niece Amanda, under whom complainants claim, complainants are entitled to have her will produced and proved. If, on the other hand, Matilda Eichter became the sole owner of the lands in question, complainants acquired no right to the discovery and production of the will of Hermina Elizabeth King, so far as this case is concerned.

Since relief, by discovery, cannot be obtained by an action at law but only by a bill in equity, this demurrer, which is interposed both with respect to discovery and relief, requires the consideration and determination of the will of Henrietta Ludemann and the effect thereof on the lands in question.

The will of Henrietta Ludemann, or so much thereof as affects the lands in question, is as follows:

“I give and bequeath to my beloved husband, Henry Ludemann, in trust for my two daughters, Amanda and Matilda M. G. Ludemann, and my sistei-, Hermina Elizabeth King, of Hamberg, in Germany, until my two daughters aforesaid shall have arrived at the age of twenty-one years, all my real estate situated in the township of West Hoboken aforesaid, in three equal shares, share and share alike, as they three shall determine, after my youngest daughter aforesaid shall have arrived at the age of twenty-one years, * * * and if any or either of the three devisees aforesaid should die prior to the execution of the trust aforesaid, then and in that case, the real estate aforesaid shall go to the survivors or survivor of them.”

Tlie bill shows that the three ’ devisees named in said clause were alive when the youngest of the daughters of testatrix-arrived at the age of twenty-one years. It does not show that they did anything with respect to a division of the lands before the two devisees died leaving demurrant the survivor.

Her claim is that' the death of two of the devisees occurred “prior to the execution of the trust,” and that by the express words of the last sentence of the above quotation, the real estate devised went to her as the sole survivor.

But this construction is inadmissible. The trust created in the husband of testatrix is expressly limited in point of time to the period intervening between the death of testatrix and the coming of age of the youngest daughter. The time thus limited is not extended by the phrase “as they three shall determine,” for that phrase did not alter the express division into three equal shares, and plainly did no more than express the right which the beneficiaries had, if any, to divide the lands -in question.

This construction, however, does not dispose of the question raised, for it will be observed that while there is a devise to the husband in trust for a fixed period and an express provision that death before that period had elapsed will cast the estate upon the survivors or survivor, there is no -express provision in ease all the beneficiaries survive that period.

If no provision for that contingency was made by this will, and the testatrix died intestate in respect to the remainder after the trust, her estate descended to her two daughters, and the complainants are entitled to partition as being seized of the undivided one-half that upon that construction descended to Amanda.

The testatrix cannot be presumed to have intended to die intestate with respect to any part of the real estate in question.

A devise, by implication, will be recognized where the testatrix used the words manifesting an intent to give by so strong a probability that the contrary intent cannot be supposed to have existed in her mind. Denise v. Denise, 10 Stew. Eq. 163; Barnard v. Barlow, 5 Dick. Ch. Rep. 131; S. C., 6 Dick. Ch. Rep. 620. Testatrix’s purpose that the same interest in the three beneficiaries should exist after her youngest daughter had come of age, is clearly expressed in the clause providing for their dividing the lands. The gift to the survivors or survivor of the three in ease of the death of one or more before the period had elapsed, shows an intent to dispose of all the interest in the lands in question in ease all of the three beneficiaries survived beyond that period.

The result is that, upon the construction I give to this will, the three devisees took an estate, when the youngest daughter came of age, as tenants in common in equal shares. Complainants are therefore entitled to discovery of the will of Hermina Elizabeth King, and the demurrer must therefore be overruled.

If the defendant answers, making discovery and setting up an adverse title upon the construction of the will which she claims, there may then arise a question whether this court, having acquired jurisdiction to award relief by discovery, may not proceed to determine all the questions in the case, or whether upon proceedings to partition it should require the title to be settled by an action at law.


author: Pitney, V. 0.

text:
    The Chesapeake and Ohio Railway Company v. The Atlantic Transportation Company.
    [Filed November 1st, 1901.]
    1. A party who applies to this court for, and obtains the appointment of, a receiver for an insolvent corporation, ancl the vesting of the title of the assets thereof in such receiver, will not be permitted by this court to take proceedings in a foreign jurisdiction to obtain a prior lien on those assets for his own debt.
    2. It is no objection to .the exercise by this court of its preventive remedy in such a case that the party is not within its territorial jurisdiction. By bringing suit in this court to subject the assets to its jurisdiction, the party subjects himself to its jurisdiction, for all purposes, touching the administration of those assets. '

      Oil petition of Francis J. Swayze, receiver, for injunction against the Chesapeake and Ohio Railway Company.
    On January 2d, 1899, upon a bill filed in this court by the Chesapeake and Ohio Railway Company, a foreign corporation, receivers were appointed for the Atlantic Transportation Company, a New Jersey corporation. Among the assets of the Atlantic Transportation Company were certain sea-going barges, used in the transportation of coal between Newport News, in Virginia, and eastern ports. At the time of the appointment of the receivers, four of these vessels, including the “West Virginia” and “AVoodside,”. were actually at Newport News, and had been attached there, on December 31st, 1898, at the suit of the Knickerbocker Steam Towage Company. The “AVest Virginia” and “AVoodside” were subject to a mortgage, given some time prior to the attachment, to the AVestern National Bank of New York.
    ’Upon the day the receivers were appointed in this court, the Atlantic Transportation Company conveyed, by a bill of sale, all of the vessels, including the “AVest Virginia” and “AVoodside,” to the receivers, in pursuance of the order of this court.
    On January 5th an ancillary bill was filed by the Chesapeake and Ohio Railway Company in the circuit court of Newport News, setting up the appointment of the receivers in New Jersey, and praying that they be appointed receivers in Virginia. On the same day the circuit court of Newport News appointed the New Jersey receivers receivers in Virginia. The order appointing them recited that the appointment was made “in support of, and ancillary to, the appointment by the court of chancery of New Jersey.” The order further directed that the officer having-possession of the vessels under the attachment should deliver them to the receivers,.upon the execution of a bond conditioned to indemnify the plaintiff in attachment from loss or damage caused by the transfer of the vessels to the receivers.
    On January 6th the receivers gave such a bond, and the vessels were released by the officer. In pursuance of an order of this court, the receivers continued the business of the insolvent corporation, using for that purpose the vessels in question.
    On May* 22d the chancellor restrained the receivers from removing certain vessels, including the “West Virginia” and “Woodside,” except to some place within the jurisdiction of the •court of chancery. The “West Virginia” was then at Providence, Rhode Island, and the “'Woodside” was at New York. City.
    On May 25th the circuit court of Newport News, upon the petition of the receivers, directed that they deliver possession of the vessels to the sergeant of the court, to be by him held, by virtue of the attachment of December 31st, 1898, in favor of the Knickerbocker Steam Towage Company. The order directed that the transfer was to be without prejudice to the rights of the towage company upon the bond given by the receivers on January 6th.
    On June 12th the chancellor vacated the injunction of May 22d, and on June 13th he directed that the Western National Bank, the mortgagee, might apply to ■ the proper tribunal in Virginia to take possession of the vessels, with or without notice to the receivers, and ordered the receivers to facilitate, in every reasonable and proper manner, the granting of the application.
    On July 3d a petition was filed by the Knickerbocker Steam Towage Company for the removal of the receivers in New Jersey. Pending this application,’ on August 26th, the Chesapeake and Ohio Railway Company filed a bill in equity in the circuit •court of Newport News, alleging that the mortgage of the Western National Bank was invalid as to indebtedness held by the railwa3r company, and praying that the railway company might have judgment for the indebtedness and an attachment against the vessels, including the “West Virginia” and “Woodside,” to’ secure its claims. On the same day the vessels were attached in the last-mentioned suit.
    On September 2d an amended bill was filed in the receivership ■suit in Virginia, originally begun on January 5th, by the Chesapeake and Ohio Railway Compaq, charging that the mortgage ■of the Western National Bank on the “West Virginia” and “Woodside” had never been recorded, in pursuance of law, and was invalid as to all creditors of the Atlantic Transportation Company who had no actual notice of the same. . The amended bill set up an indebtedness of the Atlantic Transportation Company to the Chesapeake and Ohio Coal Agency Company; the assignment of that indebtedness to the Chesapeake and Ohio Railway Company, and that the Chesapeake and Ohio Coal Agency Company had no actual notice of the mortgage until after the affairs of the Atlantic Transportation Company were put in the hands of receivers. The amended bill prayed that judgment be awarded to the complainant for its indebtedness, and that the mortgage debt be declared invalid as to said indebtedness.
    On September 12th, 1899, the receivers in New Jersey resigned, and Francis J. Swayze was appointed receiver, the former receivers being directed to transfer to him all assets, which they accordingly did, by bill of sale dated on that day.
    On September 23d the former receivers resigned as receivers in Virginia, and Swayze applied to be appointed ancillary receiver there. This application was denied by the Virginia court, which refused to appoint any receiver.
    On September 28th Swayze, as receiver, died a petition in this court, in the receivership suit, for an injunction, setting-up the proceedings in the ease, and charging that the “West Virginia” and “Woodside” were in the possession of the former receivers prior to the Virginia attachments of the Chesapeake and Ohio Railway Company of August 26th; that the vessels were returned by the receivers .to Virginia from northern waters solely for the purpose of enabling the.former receivers to discharge themselves from liability on the bond to the Knickerbocker Steam Towage Company; that the attachments of the Chesapeake and Ohio Railway Company in Virginia were levied after the appointment of receivers and after the title to the property had vested in the receivers, and were an unwarranted interference of the Chesapeake and Ohio Railway Company with the powers of the receivers, and embarrassed the petitioner in the execution of his duties. The petition charged that the vessels were depreciating and being destroyed; that maritime liens were accumulating, and that the interest of all parties required that the receiver should have speedy possession and hold and dispose of the vessels under the order of the court of chancery. The prayer was for an injunction restraining the Chesapeake and Ohio Railway Company from proceeding with the Virginia suits; from setting up any lien, by virtue of their attachments or otherwise, and for an order requiring them to release the vessels from any lien they might have acquired, and to cause the same to be delivered up to the New Jersey receiver.
    The answer of the complainant, the Chesapeake and Ohio Railway Company, to -this petition admits the facts as therein stated, and admits that the vessels are deteriorating in value, but insists that they should be sold by order of the Virginia court. It expressly denies the jurisdiction of the court of chancery to make the order prayed for.

      Mr. Francis J. Swayze, fro se.

      Mr. Charles L. Corbin, for the Chesapeake and Ohio Railway Company.

      Mr. Thomas N. McCarter, Jr., for the Western National Bank.

      Mr. ---(of the Virginia bar), for the Knickerbocker Steam Towage Company.
   Pitney, V. 0.

(orally).

My view of this case has been very briefly and accurately stated by the receiver in his argument. The receiver has no partisan views in this case, except to get the property for the benefit of the creditors. He is a quasi judge in the matter, and the court always listens to his views, because they should be impartial; and I mention that not because I adopt his views on that ground, but because they were judicious and struck me as such as he was stating them.

The case stands in this wise: The Atlantic Transportation Company, on the 2d day of January, 1899, was possessed of a number of sea-going vessels; some of them were barges which were towed, but they were sea-going vessels as I understand it; there is no dispute about that. The business of the Atlantic Transportation Company, as shown by the papers, was that of transporting coal from the terminus of the Chesapeake and Ohio railway, at Newport News, near Port Monroe, Virginia, to different ports to the north and east of that port, and two of the vessels happened at the date named to be in Virginia waters. The}' went there in the regular course of business. So far as appears they had no situs whatever in the State of Virginia any more than any other vessel that was trading at one of the ports of Virginia had a situs there. On the contrary, the indications are, although there is no specific direct proof to that effect, that their situs or home port, or place of registry, was either in New Jersey or in New York. The two vessels were, prior to January 2d, 1899, seized at Newport News by an attachment, issued at the instance of a creditor of the Atlantic Transportation Company, the Knickerbocker Steam Stowage Company. It had issued an attachment for a debt against the Atlantic Transportation Company and seized those two vessels, and they were in the hands of the sergeant of Newport News, an officer of that Virginia court.

On the 2d of January, 1899, the Chesapeake and Ohio Railway Company, a corporation of the State of Virginia, I believe, filed its bill in the court of chancery of New Jersey, praying the appointment of a receiver of the Atlantic Transportation Company, on the ground that it was insolvent. Two gentlemen, named by the Chesapeake and Ohio Railway Company, were appointed receivers—General Meaney and Mr. Ingalls, a son of the president of the Chesapeake and Ohio Railway Company. The Atlantic Transportation Company, by a proper bill of sale, immediately made a deed of those two vessels, with others, to* the receivers, whereby their title, in my judgment, was perfected and did not require the aid of any court of any othet state to perfect it; precisely as if the ships had been lying at a dock here in New Jersey. But such title was subject to the attachment in Virginia, and of course the receivers could not get the possession of the vessels from the sergeant, or marshal, the officer of the court, who had possession of them, without taking some proceeding. It was thought proper, therefore, that the receivers so appointed should be appointed ancillary receivers by the Virginia court. There may have been other assets in the shape of rights and credits in Virginia—I know nothing of that—there may have been many reasons why they should have been appointed ancillary receivers in Virginia, besides the peculiar situation of these two vessels; because to reach rights and credits which had a situs in Virginia it was necessary to have ancillary receivers appointed there. The Chesapeake and Ohio Railway Company filed a bill in a Virginia court January 5th, 1899, of the same general character as that previously filed in this court, and upon its application the same gentlemen were appointed by that court ancillary receivers, and by the order of appointment they were declared to be mere assistants to the receivership in New Jersey where the corporation belonged.

Subsequently the receivers obtained an order of this court to continue the business of the Atlantic Transportation Company and to carry it on precisely as if there had been no receivership, and for that purpose they desired the possession of these two vessels, and in order to get them from the sergeant, who had them in possession, and for that purpose only, they gave a bond to the plaintiff in that attachment suit, or to somebody to answer for those vessels, and took possession of them and brought them from Virginia and had them in New Jersey waters, and used them as if they had never been attached.

Now, in my judgment, their title to those vessels arose primarily and principally, and, I may say, entirely out of the fact that they were appointed receivers by the State of New Jersey, and got a bill of sale from the insolvent debtor. The only aid to their title which arose out of the ancillary receivership was simply to enable them to get the bare possession of the vessels, but did not strengthen their title a particle, for the reason— and I repeat it—that there did not appear to have been any situs in Virginia, except the incidental one of their being attached there, as they were lying in the public waters of the United States, in the limits of the State of Virginia.

Now, in that state of things, the business of the corporation was continued, and it turned out that there was a claim advanced by the Western National Bank that it held a mortgage, registered in the city of New York, upon these and other vessels, and the United States Trust Company held some mortgages, and the chancellor, on the application of these receivers and of the creditors who held the mortgages, made an order substantially that the vessels should be delivered up to the mortgagees upon pavrment of some trifling sum, or no sum—I forget how that was.

Mr. Corbin.'—Finally no sum.

The Court—Finally no sum; but the difficulty was that'if the receivers delivered up to the mortgagees those two vessels that had been subject to the Virginia attachment they might be liable on their bond that they had given in the attachment suit in Virginia to get possession of them. Therefore the chancellor ordered that they might, and should, in ease of their bond and to relieve them from its effect, if possible, re-deliver those vessels to the sergeant-in Virginia, and they did so. At the same time they got an order of the Virginia court which states distinctly on its face that they were delivered to that sergeant simply for the purposes of that attachment. It was no relinquishment of title whatever, except, it may be, between them and the mortgagees. As between them and the mortgagees, it having been done in pursuance of the order of the chancellor for that purpose, it may hereafter be claimed by the mortgagees that that delivery was for their benefit; but, for present purposes, I will put the mortgagees out of view. And if you put the mortgagees out of view, then that delivery did not at all affect the receivers’ title. It simply helped them, as a defence to any action of the bond they had given, to get possession.

Things remained in that shape until the 26th of August, when the Chesapeake and Ohio Railway Company, the complainant in this suit, filed an attachment bill in the Virginia court, on the equity side, attaching these ships, on a claim of debt that it held against the Atlantic Transportation Company.

Now, right here, that conduct was entirely contrary to first principles, in my judgment. It had no right to do it. It was a contempt of this court. It was flying in the face of this court. It had come here and asked this court to appoint receivers to take these vessels and administer them for the equal benefit of all creditors, and it tons around in the face of that and attempts to get a lien for its own individual benefit. Now, I repeat, that conduct was contrary to fundamental principles on which the courts deal with such cases. So held by all the authorities. Mr. McCarter handed me up the other day a list of cases on the subject, and among them is the one in Vermont, decided by Chancellor Royce (Vermont and Canada Railroad Co. v. Vermont Central Railroad Co. et al., 46 Vt. 792), which contains a very able and complete review of all the authorities, citing some in various states and in England; and there is also the Rhode Island case. Chafee v. Quidnick, 13 R. I. 442. I shall not go into them, except to merely refer to the Vermont case, which is so exhaustive that it really leaves nothing to be desired in the way of discussion. The bringing of that action by the Chesapeake and Ohio Railway Company was a contempt of this court, in my judgment, and if this proceeding were one to adjudge the Chesapeake and Ohio Railway Company in contempt, I should do it.

Then the mortgagee, the Western National Bank, filed a petition in this court for leave to take possession, I believe, and for an injunction against the Chesapeake and Ohio Railway Company.

Mr. McCarter—That petition was only for an injunction.

The Court—Oh, yes; but after you had filed a petition for leave to take possession the Chesapeake and Ohio Railway Company filed an amendment to the original insolvency'bill filed on the 5th of January in the Virginia court, and in that amendment it set up that the mortgage of the Western National Bank is void, without, as I understand, stating on what ground it is void. Then, by that' bill, it prays that it may be declared void, and in effect prays that it may have the proceeds of the sale of these vessels for its own benefit. It is now said by counsel that that amendment has been amended, so that the bill is filed for the benefit of all of the creditors. And he says they have jurisdiction of those vessels because they are in Virginia waters, as against the mortgagee, the Western National Bank; which compels the Western National Bank to go down there and litigate that question.

Now I very much doubt whether it, or the Virginia court, has any such possession as will give it such jurisdiction, and it is very desirable that that question should be raised where the court will have undoubted jurisdiction. As I understand, the Western National Bank has declined to accede to that jurisdiction; has not appeared in that court. I don’t know whether it is made a party or not, or whether process has been issued against it, or whether there has been any publication, or anything of that kind.

Mr. Swayze—I think there is an order of publication, or something like that, but I am not sure; there is no process-—no appearance.

The Court—In the meantime the two receivers who had acted in this case (and the evidence before the court shows that they were acting all the time entirely in the interest of the Chesapeake and Ohio Eailway Company—I am justified in saying that) were proceeded against, in this court, for their removal, and when the order to show cause why they should not be removed came on for argument they resigned without waiting for an inquiry into the merits, and promised to resign as ancillary receivers in Virginia and did do so, and were relieved by both courts. The court of chancery of New Jersey then appointed Mr. Swayze, the present receiver, in their place. In the meantime, however, Mr. McCarter, on behalf of the Western National Bank, had filed a petition for an injunction against the Chesapeake and Ohio Eailway Company to restrain it from proceeding with those suits in Virginia. When the new receiver was appointed he came in and took the case up himself, and filed a petition on his own account, which the Chesapeake and Ohio Eailway Company has answered under protest, denying the jurisdiction of this court; and the matter is now before me on that petition.-

I shall not at present take any notice of, or deal with, Mr. McCarter’s petition on behalf of the Western National Bank. The question now is whether the court of chancery can permit the Chesapeake and Ohio Eailway Company to do anything whatever to prevent the receiver it has appointed from getting possession of these vessels; and I am decidedly of the opinion, notwithstanding the very able argument that has' been made by Mr. Corbin, for which I am certainly very much obliged—I am decidedly of the opinion that this court should take prompt and thorough action as far as it can to prevent that proceeding on the part of the Chesapeake and Ohio Eailway Company. The only ground on which I can see that the Virginia court can hold those vessels, with any kind of respect for propriety in judicial proceeding, is on behalf of the Knickerbocker Steam Towage Company. Now it was stated here by respectable counsel from Virginia that he, on behalf of that steam towage company, had given a consent to the sergeant or marshal to let these vessels go; that there was no reason, so far as the steam towage company went, why the marshal should not be permitted to deliver possession of them; and that, being so, the only thing in the way of the receiver getting possession is the action of the Chesa-. peake and Ohio Eailway Company.

The question of jurisdiction of the Virginia court does not arise here, because, whatever jurisdiction it may have, it can exercise only at the suit of somebody. There- must be somebody there asking for its exercise, and the only person asking for it, so far as this court at this time perceives, is the Chesapeake and Ohio Eailway Company; and this court will forbid the Chesapeake and Ohio Eailway Company to- ask the Virginia court to retain those boats.

Of course, the receiver has to deal as best he may with the steam towage company, the original plaintiffs in attachment there. That we have nothing to say about. The Chesapeake and Ohio Eailway Company is not responsible for that.

Objection is made to any action by this court' against the Chesapeake and Ohio Eailway Company, on the ground that it has no jurisdiction of that company. I think the objection is without merit. The.very point is covered by the Ehode Island case above cited. There a distinguished counsel from New York and a distinguished counsel from Boston united in making application, as counsel merely, in favor of a client, to the Ehode Island court to appoint a receiver of an insolvent company, and after such receiver was appointed on their application one of the gentlemen assigned to the other his claim against the insolvent company for services, and the assignee issued an attachment in New York and levied upon certain funds belonging to the insolvent company in the hands of a merchant there. The matter being brought to the attention of the Ehode Island court, it adjudged that counsel in contempt, on the ground that, though not within the jurisdiction of.the court, he had, by merely acting as counsel, and not as solicitor or attorney, for the plaintiff, submittcd himself to the jurisdiction of the court. That case goes much farther than the present.

Rut there is another line of cases in the federal courts which J think is of significance here. It is a settled rule in those courts that if a party comes from one circuit into another circuit and brings an action there, and appears only for the purpose of bringing that action, the defendant in that action may file a bill on the equity side as a defence to that action, and acquire jurisdiction of the person by service upon his solicitor, or service out of the jurisdiction, which he could not otherwise acquire. I will give you an illustration of it. One Trotter, who lived in Brooklyn, New York, brought an action of trespass in the United Stales circuit court for the district of New Jersey, against the old New J erscy Zinc Company, based upon the title to a strip of land in the zinc district in Sussex county. He obtained a large verdict before Judge Nixon, sitting in the circuit court; and after the refusal of a new trial, I was brought in as counsel by the zinc company. ■ The plaintiffs title rested upon a mistake—as the defendants alleged—in the description of a deed; and I filed a bill in equity, on behalf of the zinc company, in the circuit court of the United States for the eastern district of New York, to reform that deed and to stay the execution on the judgment. I obtained a preliminary injunction or order, ex parte, from Judge Benedict in the United States circuit court. The judge went abroad, and the order to show cause, answer, &e., came on before Judge Blatchford. I had supposed that I must, of necessity, go into the district where Trotter lived, and that I could not get jurisdiction of him in the New Jersey district; but Judge Blatchford, without going into the merits, dismissed my bill by a short opinion that never was published, in which he pointed out the decisions in the United States circuit court to the effect that in such a ease the federal court of New Jersey had jurisdiction, and that the appearance of Mr. Trotter there in his action compelled him to submit to the jurisdiction of that court by a service on his solicitor, without service on him within the jurisdiction, as to all matters arising out of or pertaining to the subject-matter of the suit brought there by him. On the same bill and affidavits I immediately applied to Judge Nixon in the New Jersey district, and obtained an injunction. In the present case the proposed action against the Chesapeake and Ohio Railway Company pertains to the subject-matter-of its suit in this court.

Another objection made is that the vessels should be kept within the jurisdiction of the Virginia court, because the receivers gave bond in that court as such, and may be liable to prosecution there in respect to their possession of the vessels. I think there is nothing in that objection. Those receivers, by the order of this court, and also by the order of the Virginia courtj delivered those vessels to the marshal or sergeant, and afterwards, by the order of this court, conveyed them to the new receiver. They have been discharged from further duty as receivers, by both courts, and I am unable to imagine that they can be charged, as ancillary receivers, with any breach of their bonds given in the Virginia court. But if such a breach should be averred, it seems to me that this court has complete power to protect them in the premises.

I will advise an order, made as strong and as searching as counsel can draw it, forbidding and restraining the Chesapeake and Ohio Railway Company from doing anything in any suit, or taking any measures whatever, either directly or indirectly, to prevent the receiver, Mr. Swayze, from taking possession of those vessels. I don’t see that 1 can go any further to-day.

'After an order made in pursuance of the foregoing opinion, Mr. Corbin, on behalf of the Chesapeake and Ohio Railway Company, asked for a stay of the order pending an appeal, which the vice-chancellor declined, saying:

It seems to me that it comes out just where I stated before you proceeded with your argument; that the preservation of the status quo. so far as regards the rights of all parties—and that is the thing to look at—will be preserved; the status quo will be preserved by letting the receiver have those vessels and selling them and turning them into money, to prevent them from deteriorating by the action of the water. I believe it was stated by you, or admitted by your answer yesterday, that those vessels are deteriorating in value all the time.

Mr. Corbin—They ought to be sold, there is no doubt about that.

The Court—If so, what better could be done to preserve the rights of everybody, the status quo—to use, I suppose, the substance of the language of the late chief-justice in his opinion which has caused so much criticism—what could be done better than to sell those vessels and impound the proceeds? Here is the subject-matter—tire proceeds of the sale of the vessels. This court gets the money proceeds here in the hands of its receiver. The court of errors and appeals decides that it ought to go to somebody down in Virginia—to a new receiver 'to be appointed there. This court will obey the order of the court of errors and appeals and send tire money back to Virginia. The thing is preserved. The right of the Virginia court is also preserved. Because if it appears that the Chesapeake and Ohio Bailway Company has a right to prosecute that suit in Virginia, as soon as the court of errors and appeals so decides, this receiver is ordered to return the fund and the court of errors and appeals will direct the court of chancery to restore the corpus to the Virginia courts.

I think it eminently a case where the whole spirit of the law, which has been exemplified in New Jersey by the National Docks Case, and which has been attempted to be—I desire to compliment the gentleman on his draft of that act—has been attempted to bo put in writing, but which is beyond the power of mortal man to do, precisely as it is beyond the power of mortal man to codify the laws of any progressive country— requires that the order I have advised should be executed by bringing the property in question into this state and turning it into money. And what have we got here? The subject-matter of dispute is two vessels—two sea-going barges—and the question is who is to dispose of those barges—the courts of New Jersey or the courts of Virginia? It is admitted on all hands that the barges should be taken care of by being sold and turned into money. This court is of the opinion that it is the business of this court to do it, and not the business of the Virginia courts. This court so decides; and in the meantime let the barges be sold, and if the money is in the hands of this court, and the court of errors and appeals shall be of opinion that this court is wrong, the money will be returned. The subject-matter will be there-—saved—and preserved as thoroughly as it possibly can be. Now that is the situation. And for these reasons I decline to stay the operation of the order in any way pending the appeal.


author: Pitney, V. C.

text:
    William S. Canon v. George M. Ballard.
    [Submitted October 15th, 1901.
    Decided October 24th, 1901.
    Filed December 21st, 1901.]
    1. Where, in an action for accounting, complainant alleges that his son gave a mortgage to secure a debt complainant owed to defendant, and that on foreclosure defendant received a certain sum in excess of the amount complainant owed, the son was a necessary party to the action.
    ■2. A bill alleging that property was conveyed to defendant—first, to secure himself in a certain amount; second, to secure complainant in a certain sum which defendant owed complainant, and which is past due; and, third, to sell and divide the proceeds; and that on demand defendant refuses .to sell the property, claiming the right to hold it unsold at his pleasure, states a cause of action.
    3. A bill alleging that certain land was conveyed to defendant in full payment of a sum which he had paid as a surety for complainant, but that defendant claimed such conveyance was only as security, and that complainant owes the amount, states a cause of action to determine their respective rights.
    4. A bill alleging- that defendant holds complainant’s bond and notes, which have been fully paid, but which defendant claims are unpaid, and praying that he be required to surrender them, states a cause of action for equitable relief.
    5. Where, in an action for accounting, the bill states several separate grounds for equitable relief, but they are so intermingled that all must be determined in order to settle the account, the bill is not multifarious.
    On demurrer to bill.

      The object of the bill is to procure an accounting between the complainant and the defendant of divers pecuniary transactions that have taken place between them, in which divers obligations have been given by the complainant to the defendant, and vice versa, and to procure a sale by the defendant of certain real estate situate in Danbury, Connecticut, to which he holds the absolute tiñe, with a declaration that the complainant is interested therein to the extent of $3,500. The allegation is that upon such an accounting a large balance will appear to be due from the defendant to the complainant, and that such balance is actually due.
    The bill sets out, by a schedule annexed thereto, the terms of the written declaration, which declares that the defendant holds the Danbiuy property to secure the complainant the sum of $3,500, subject to certain prior encumbrances, with an undertaking to malm sale of the same in order to pay the complainant the amount mentioned. The bill alleges that the complainant has requested the defendant to make such sale, and that the defendant refuses—first, on the ground that he is not obliged to make such sale until he shall feel so disposed, and second, that there is nothing coming to the complainant out of said premises because the complainant is indebted to him upon other accounts.
    The bill sets out, somewhat in detail, various transactions between the parties, and gives complainant’s views of the results of each, and asks that they may all bo examined and determined by the court.
    The demurrer takes three grounds—first, that the bill does not show any equity; second, that it is multifarious, and third, that one William W. Canon, the son of the complainant, should have been made a party defendant.
    The various matters set out in the bill may be epitomized as follows:
    First, before the 6th óf August, 1895, the complainant was engaged in the fire insurance and real estate business in the city of Newark on his own account, and on that day entered into an agreement of partnership with the defendant in that business and conveyed to him a one-half interest therein. The partnership agreement is in writing, and is annexed to the bill as a schedule; that the defendant took possession, so to speak, of his share in the business and exercised his right as a partner therein, but in fact took little active part in the work of the business,- and continued to hold his share until February 19th, 1896, when he sold his one-half interest to one Andrew Knox, and agreed on such sale (presumably in consideration of complainant’s consent thereto) to pay complainant the sum of $2,500, which he has never paid; that Knox, in order to secure the defendant the amount which he agreed to pay the defendant for his one-half interest in the business, of which the $2,500 to be paid to. the complainant was a part, conveyed to the defendant the real estate in question in the city of Danbury and State of Connecticut; that in order to secure the complainant the said sum of $2,500, which the defendant had promised to pay him on the transfer of the defendant’s interest to Knox, the defendant, after repeated-demands of payment by complainant, .gave him a written agreement, which is set out as a schedule, in which he acknowledged that he held the title to the Danbury property—first, to secure to himself $4,390, and second, to secure to the complainant $2,500, subject to an agreement giving Knox the option to purchase it at any time prior to February 19th, 1899, at any price-at which the defendant should be willing to sell it; and, finally, to sell the property and divide the proceeds, as before stated,- and in the meantime to collect the rents and divide the same in the same proportion.
    The bill alleges that the complainant has repeatedly requested the defendant to sell the Danbury property, which he has refused to do, and that the defendant claims—first, that he has a right to hold it unsold at his pleasure, and second, that he has other claims against the complainant sufficient to absorb the whole $2,500, or some part thereof.
    The bill then proceeds to set out the other transactions between the parties.
    First, that on December 23d, 1895, complainant gave a mortgage to the defendant, covering several tracts of real estate in the city of Newark, to secure the sum of $5,000; that subsequently the complainant paid the defendant, on account of this mortgage, the sum -of $2,500, on the occasion of a sale, by the. complainant, of a portion of the premises and a release^ by the-defendant, of the part so sold; and also, at the same time, procured his son, William W. Canon, to give the defendant a mortgage for $2,000, covering lands in Somerset county, subject to a prior mortgage, as collateral security for the balance duo on Ihe $5,000 mortgage; that subsequently the holder of the first mortgage on the Newark property foreclosed it, with the result that the surplus money, amounting to over two thousand seven hundred dollars, was paid into court, which the defendant procured by a petition, presented to the court, based on his $5,000 mortgage, alleging, in his petition, that there was due at that Lime, $2,960.79; that in the meantime the holder of the first mortgage on the Somerset county property foreclosed his mortgage, making the defendant a party by reason of his mortgage, given by William W. Canon, with the result that the defendant received a surplus from the sale of that property of over nine hundred dollars.
    The bill further states that the defendant holds the complainant’s promissory notes for over four hundred dollars.
    Another transaction set out in the bill is that, at the time of the existence of the partnership between the parties above mentioned, tire complainant was the agent in Newark of the Hartford Eire Insurance Company, and, as such agent, was compelled to give, and did give, a bond to that company, with the defendant and another as sureties, conditioned for the faithful performance of his duties as agent; that in October, 1896, the complainant was indebted to Hu; said insurance company for about one thousand six hundred dollars, and in order to secure it conveyed to a Mrs. Young, the wife of the manager of said company, the premises situate in the city of Newark known as Nos. 51 and 53 Lock street, and that Mrs. Young executed to complainant a defeasance, conditioned for the reconveyance of the premises if the sum of money owing by complainant was duly paid; that subsequently the defendant, who, as before stated, was surety for the debt, paid (he sum of $1,600, with interest, to the insurance company, and received from Mrs. Young, with the consent of complainant, a deed of conveyance of said Lock street property; that complainánt understood that Mrs. Young’s conveyance was accepted by the defendant in payment of complainant’s indebtedness to the defendant arising out of the payment, by defendant, of Ms debt to the insurance company, but that defendant claims that he holds the property last mentioned only as security for the amount so advanced, and that the complainant is still indebted to him for that amount, and has demanded payment thereof from the complainant; that defendant is in possession of, and is receiving the rents and profits of, the Lock street property; that the complainant has frequently demanded of the defendant a settlement of these different matters between them, and that defendant has refused to make any settlement, and claims and insists that complainant is indebted to him; but, on the contrary, the complainant charged the truth to be that the defendant is indebted to him in a large sum of money.
    The several prayers of the bill are—first, for a formal dissolution of the partnership; secondthe determination of the question whether the defendant holds the Lock street property as security for, or as a satisfaction of, the amount paid by him to the insurance company on complainant’s account; third, that the amount of indebtedness between the parties at the time of the sale of the Somerset county property may be determined, and that the defendant may be required to give complainant credit for the amount received by the defendant as the proceeds of the sale thereof; that an account may be taken and stated between the parties, finding and determining- the amount due one way or the other, and that the defendant may be ordered to deliver up the two bonds and mortgages before mentioned, as also the promissory notes, and that he may be decreed to sell the property in Danbury and account for the same in the accounting to be had hereunder.

      Mr. Frank F. Bradner, for the complainant.

      Mr. IF. Bradford Smith, for the defendant.
   Pitney, V. C.

It is apparent at once that the complainant cannot, upon an accounting, have credit for the money received by the defendant from the sale of the Somerset county property without making William W. Canon a party to the suit. The reason of this is that.a decree that complainant is entitled to such credit should protect the defendant against any demand which William W. Canon may hereafter make against him for the money so received ; and as the demand by the complainant for credit of that money is a material part’ of his bill and a necessary part of the accounting prayed for, and as the non-joinder of William W. Canon was stated as a special cause of demurrer, I am of the opinion that the defect so shown cannot be overlooked.

But the other questions raised by the other causes of demurrer were treated by defendant’s counsel as more serious, and were thoroughly argued, and should be disposed of at this stage of the cause.

With regard to the general want of equity, the complainant shows two distinct equities. First, admitting, as we must, the allegation of the bill to be true, he is entitled to a sale of the Danbury property, and he is entitled to have it sold to the best advantage, so as to bring the highest price, and, measurably, under the direction of the court.

In the second place, he is entitled to a determination of the question in dispute between him and the defendant as to whether the debt which he incurred to the defendant when the latter paid his, complainant’s, debt to the insurance companj’-, was satisfied by the conveyance to the defendant of the' Lock street property, or whether the debt remains and the title of the Lock street property is held by the defendant merely as security for its payment. It is quite clear that this question can only be determined in a court of equity.

Both these grounds show clear reasons for coming into this court.

Another ground of equity is that the complainant is entitled to have his bond for $5,000 secured by the mortgage surrendered and given up to him if it is paid. The possession of the two mortgages, one for $5,000, given by himself, and the other for $2,000, given by his son, and their existence as writings, is presumably of no consequence.

Again, if the allegations of the bill be true the complainant is also entitled to have his promissory notes held by the defendant delivered up and canceled.

These all show grounds for coming into equity.

The next ground of demurrer is multifariousness, namely, that the complainant has mixed together in one bill different matters not connected with each other. It is familiar learning that this is an objection which the courts deals with according to the circumstances of the case, and as will best promote the convenience of the administration of justice.

Here it is perfectly plain that every one of the several matters are necessary to be investigated in order to determine whether or not the complainant is entitled to the ultimate relief of a sale of the Danbury property. Has the $5,000 mortgage been paid? If so, then the defendant cannot set up the bond which was given with it as an indebtedness against the complainant.

Must the defendant give the complainant credit for the nine hundred and odd dollars received from the Somerset county sale ? If so, then that amount must go in obliteration of any balance due on the $5,000 mortgage, and also in payment of the amount due on the promissory notes, and if any is left then the amount must be applied on the amount paid to the fire insurance company, if that is not already paid by conveyance of the Lock street property.

Then was the conveyance of the Lock street property in satisfaction of that debt, or only as security for it ? If in satisfaction of that debt, then the defendant cannot set up that debt against the amount secured by the Danbury property. If not made in satisfaction, then the defendant must account for the rents and profits, and the complainant is entitled to redeem, and he is entitled to have the Lock street property sold to pay, as far as it will, the amount secured thereby, a!nd only the balance brought in against the Danbury property.

Thus it will be seen that all these matters are necessary for a general accounting between the parties, to which the complainant is clearly entitled in order to determine his rights in the Danbury property.

The result is that the objection on the ground of multifariousness fails.

The demurrer must be sustained on the ground of the lack of parties, but, under the circumstances, without costs; and complainant will be permitted to amend his bill by making proper averments to bring in William W. Canon as a party, and the defendant will answer the amended bill within thirty days after service upon him of a copy thereof.


text:
    Jersey City, Hoboken and Paterson Street Railway Company v. The New York, Susquehanna and Western Railway Company et al.
    [Submitted June 15th, 1901.
    Decided August 29th, 1901.
    Filed December 21st, 1901.]
    1. When two railways cross each other at grade and being unable to agree upon proper provisions for protection against collision submit that question to the determination of this court, it has jurisdiction to determine it.
    2. Principle upon which the court will act in making such determination discussed.
    On bill, answer, cross-bill and replication.

      Mr. William B. Gourley, for the complainant.

      Mr. Charles L. Corbin, for the defendants.
   Pitney, V. C.

The complainant is the owner of a system of street railways in the city of Paterson, and the defendant is the owner of a double-track steam railway passing through that city. The complainant has constructed a street railway, as an addition to its existing system, through Governor street in that city, on both sides of the defendant’s steam railway tracks and desires to connect the ends of its tracks, and for that purpose to effect a crossing of the defendant’s tracks at grade. The parties are unable to agree upon the mode of crossing and the precautions necessary to prevent accidents thereat, and the defendant refuses to allow the complainant to disturb its tracks to make a crossing until the mode shall have been agreed upon or determined by competent authority.; The object of the bill is to obtain from the court a judicial expression of the proper mode of crossing and precaution against accidents, and to compel the defendant to submit thereto; and defendant, by its answer and cross-bill, prays, in effect, the same relief—that is, that the complainant shall not cross except upon terms to be settled by the court; and both parties distinctly submit themselves to the jurisdiction of the court in that respect.

Some question was raised by the pleadings as to which had the prior right in the locus in quo, the defendant for its railroad or the public for the street. Both seem to have been laid out about the same time. No point, however, was made of this at the hearing, and the ease was tried as if each party had an equal right in the locus in quo, and the jurisdiction of the court was based upon the familiar principle that where two carriers have a right of common easement in a place the mode of its use may be determined by this court.

If the locus m quo had not been within the territorial limits of the city of Paterson the case would have come within the statute of March 22d, 1895 (P. L. of 1895 p. 462), which, in such case, requires an application to the chancellor, with notice to the township authorities, to determine in a summary manner the mode of crossing.- The-object of that act is declared to be, that

“such crossing shall be made in such a way as will inflict the least injury upon the rights of the company owning or operating the railroad intended to be crossed, and as will afford proper protection to the public,”

and the chancellor, under the act in question, is authorized, if in his judgment it is reasonably practicable, and public safety so requires, to avoid a grade crossing, to require that the crossing shall be above or below grade. •

It seems to me that in determining the question presented by the pleadings this court must have in mind the same considerations which would influence it if the application were made under that statute and the crossing were outside of the city limits.

Coming now to the evidence in the case, it shows that there is considerable travel over the steam railway at this point, some sixty trains a day passing one way or the other; that there are several switches near the point in question, on which freight cars are switched out to private yards in the neighborhood. Another street, namely, Tyler street, crosses the railway ■near and parallel to Governor street, and for the protection of the ordinary traveling public at those points the defendant company has erected a tower between the two streets, but nearer to Governor than to Tyler street, with wires operating gates across both streets in such a way that the operator can stop travel thereon.' The same operator also attends to a system of signaling which the railroad has occasion to use at that point.

The line of street railway through Governor street is intended to reach the northern part of the city of Paterson east of the .defendant's railway, and between that and the Passaic river at a place in the bend of that river, which is at present laid out in streets and is eligible for residential purposes, and, although at present rather sparsely occupied, it is expected will be built up and become an important residential part of Paterson. It is contended by the complainant that at present there will be little travel over its road at the point of crossing, and hence but little clanger, and that the danger does not warrant much .expense. But the fact that the complainant company thinks it worth while to build a street railway in the direction of and leading to the neighborhood mentioned, and that it is one which promises well for residential purposes, leads one to expect that there will in time be considerable travel over the complainant’s railroad; and in determining the mode of crossing regard must ,be had to the probable future as well as to the present situation.

• The complainant contends that its present mode of protecting itself and the public against accidents is sufficient, namely, that its cars shall stop when they reach the defendant’s tracks, the conductor shall alight and look up and down each track, each way— there is an unobstructed view for a considerable distance at that point—and stand on the track until the car has crossed, and that this method is in use in other places in Paterson. The complainant goes further and says that it is willing to put derailing devices oh each side of the defendant’s tracks, whose natural position will be open and can only be closed by a lever located between the defendant’s tracks; so that it will be impossible for a street car to cross the defendant’s tracks without a man standing between the tracks to close the switch by lever there to be placed. This apparatus will cost a considerable sum of money and its operation will delay the passing of the complainant’s cars across the defendant’s tracks a greater or less length of time. , The defendant’s objection to this plan is that the device so suggested, though in general use, has not proved sufficient to prevent accidents, for the reason that sometimes the power which propels the street car fails at a moment when the car is on the steam railroad and becomes there stalled, so to speák, and may be run down by a train.

I am satisfied that this danger is real and important. The proofs show that the very thing has happened in several instances in the city of Paterson, and great danger to life has resulted.

The plan proposed by the defendant is called the interlocking ■signal system. Briefly stated, it is a tower built on or near the point of crossing of the two roads, and in that tower are placed wires connected by levers with signals each way on the defendant’s road, at a distance sufficient to insure the stoppage of a train before it reaches the point of crossing. The interlocking feature consists in a wire connection, by which a single movement necessarily shows a signal on each road on each side of the crossing, that on the street railway being near the crossing. This is the system which was advised by me, and resulted in a decree, made in 1895, in the case of the crossing, by the street trolley 'company, of the Watchung railroad at Bloomfield avenue, in Essex county, outside of the limits'of any city. That question received careful consideration by me at tbe time, and the result was acquiesced in by both parties.

The complainant does not object to such a protection in this case, but it does object to paying any considerable portion of the expense of its installation and maintenance. The first cost will be about one thousand and eight hundred dollars, and it will require about one thousand dollars a year to maintain it. In the Bloomfield avenue crossing case I assessed two-thirds of the cost of installing and maintaining upon thé steam railroad and one-third upon the street railway.

Serious objection is made by complainant to the application here of that plan, on two grounds—first, as before stated, that the amount of travel over the crossing, and the danger, under the circumstances of this case, are not sufficient to warrant the expense of it; and second, that there is no occasion for it, because the defendant railway company already has a tower and a man in it, with appliances by which ordinary gates can be, and are, now shut at any time that an ordinary vehicle approaches the tracks from either side, and that arrangement is sufficient to protect the street railway company. For reasons given by the engineers, and explained at the hearing, it seems to me that the latter reason does not apply. The gates in use are not sufficiently strong to prevent a trolley car from making its way on to the steam railroad tracks, and do not prevent the danger which arises from a car becoming stalled on the tracks. Nor, in case of the installation of the interlocking signal system, is it practicable for the present signal system in use to be operated by the same man in the same tower. I think it quite clear that if the interlocking system is adopted, it must be a thing by itself, independent of the other signal system now in use. It may, in a measure, dispense with a part of the present system, and from that circumstance the steam railway company will derive a benefit. On the other hand, the use of the interlocking signal system will save time to the trolley company, and enable it to run its cars directly across the railway without stopping, except when the signal is set; o.r, if it still desires to protect itself by sending the conductor ahead, it will certainly save the considerable expense attending the installing upon the street railway of the derailing system, controlled by lever between the tracks of the steam railroad.

It was said by the complainant that the Bloomfield avenue crossing over the Watchung railroad was a much more important crossing than the one here in'question; but my recollection of that case is, and I think it is general knowledge, that travel over the Watchung railroad is but a mere fraction of that over the defendant’s railway; and while the number of street cars running over the Watchung railroad at the time that matter was settled, in 1895, may have been much greater than those which will at first pass over the place here in question, yet the strong probability is that the travel in the present ease will very much increase in years to come.

The defendant seems to be actuated by a desire to take a stand and make a precedent, so that hereafter these street crossings shall be properly protected. That desire on the part of the defendant seems to me to be commendable.

1 may add that I can see no motive which the defendant company can have in asking for terms of crossing which are unfair or oppressive to the complainant. Both are interested in the building up of the city of Paterson, and the complainant’s road is in no sense or degree, as far as I can see, a rival of the defendant’s road.

The solution of the question presented is a difficult one. It is a matter of pure judgment, in which there is no precedent upon which the court can rely, unless it be the Bloomfield avenue case..

I have spoken of the interlocking system. There are two systems. There is an interlocking signal system and the interlocking signal and derailing system. In the one reliance is placed entirely upon signals given at a long distance on the steam railroad and at a short distance on the street railway. The signal and derailing system provides, not only a signal, but also a derailment on both tracks, so that if a signal is overlooked by the engineer or motorman the train will be derailed before it reaches the point of crossing.

I have come to the conclusion that one or the other of these systems must be applied, but whether the derailing feature must be added to the signal system was not much discussed, and I prefer to bear counsel upon that subject. If the simple signal system is considered sufficient, I shall direct that the defendant company pay two-thirds of the cost of installing and maintaining it and the street railway company one-third. The terms of the decree may be similar, so far as applies, to those in the Bloomfield avenue case.

Leave will be reserved to either party to apply at any time to vary the terms of the decree determining the division of the cost of maintenance.