author: Grimshaw, J. S. C.

text:
    LOUIS KADISON, JULIUS I. KISLAK, AND ISAAC GROSS, EXECUTORS UNDER THE LAST WILL AND TESTAMENT OF ISRAEL KORETZKY, DECEASED, PLAINTIFFS, v. LILLIAN HORTON, MYER B. HORTON, JEANETTE POLLAK, JACOB KORETZKY, AND BRIGHT STAR WAREHOUSE CO., DEFENDANTS. JACK M. KORETZKY, SOMETIMES KNOWN AS JACOB KORETZKY, PLAINTIFF, v. JULIUS I. KISLAK, ISAAC GROSS AND LOUIS KADISON, DEFENDANTS.
    Superior Court of New Jersey Chancery Division
    Decided December 21, 1950.
    See also 142 N. J. Eq. 223, 59 A. 2d 587.

      Messrs. Gross & Gross and Messrs. Milton, McNulty & Augelli, attorneys for executors of the estate of Israel Koretzky.

      Messrs. Bilder, Bilder & Kaufman, attorneys for Jacob Koretzky, et al.

      Messrs. Riker, Emery & Danzig, attorneys for Jeanette Pollak.

      Messrs. Platoff & Platoff, attorneys for Julius I. Kislak.

      Messrs. Carpenter, Gilmour £ Dwyer, attorneys for Louis Kadison.
   Grimshaw, J. S. C.

There are two complaints involved in this litigation. In one, the executors of the estate of Israel Koretzky, deceased, seek the cancellation of four certificates of stock of the Bright Star Warehouse Company issued after his death in the names of Koretzky’s children. In the other, Jacob Koretzky, son of the decedent, seeks the removal of the executors, and a restraint against their qualification as trustees under the will. In this latter suit the court is also asked to void a consent to the payment of $25,000 by the Bright Star Battery Company to Abraham I. Barash, husband of one of the beneficiaries under Israel Koretzky’s will, which consent was signed by all of the beneficiaries.

The cases were tried together. The hearings extended over several months and were conducted in an atmosphere of extreme bitterness on both sides. It was difficult to arrive at the truth. The principal witnesses on both sides were repeatedly guilty of misstatements and contradictory statements. However, from the mass of evidence I am satisfied that the following facts have been established.

After a very humble beginning, the decedent, Israel Koretzky, succeeded in building up a very successful business for the manufacture of batteries, flashlights and other kindred articles. To carry on the business, Koretzky formed a corporation known as the Bright Star Battery Company. Of a total stock issue of 39,000 shares of this corporation, the decedent, at the time of his death, owned 30,600 shares. The buildings in which the business was housed were owned by a corporation known as the Bright Star Warehouse Company, of which corporation Koretzky owned the entire stock issue of ten shares.

Koretzky died in Florida, of a heart attack, on January 7, 1946. lie left surviving his daughters, Anne Barash, wife of Abraham I. Barash, Lillian Horton, wife of Myer B. Horton. Jeanette Poliak, wife of Theodore Poliak, and one son, Jacob Koretzky.

Abraham I. Barash had been associated in business with the decedent for a number of years. During Koretzky’s lifetime Barash served as secretary-treasurer of the Battery Company. Some time after Koretzky’s death Barash became president of the company, a position which he still holds. Horton joined the Battery Company in 1940. He was elected vice-president, a position which he continued to hold until his discharge in May, 1947. Poliak worked for a number of years as head of one of the departments of the company. He, too, was discharged in May of 1947, as was Jacob Koretzky. Both Barash and Horton, together with Israel Koretzky, served as officers of the Bright Star Warehouse Company.

Israel Koretzky’s will, executed in 1941, was probated on Pebruary 6, 1946. In it he named as executors and trustees, Julius I. Kislak, a prominent real estate operator, Louis Kadison, the company accountant, and Isaac Gross, the company lawyer, who had been Koretzky’s solicitor for a number of years. Among other things, the will provided as follows:

“2. All the rest residue and remainder of my estate, real, .personal and mixed, and wherever the same may be situated, I do hereby devise, give and bequeath unto my friends Isaac Gross, Julius I. Kislak and Louis Kadison, to have and to hold the same, however, in trust upon the following trusts, terms and conditions:
“(a) All cash on hand or in banks, as well as moneys owing .to me by Bright Star Battery Company, Bright Star Warehouse Company and also moneys owing to me by any other person, firm or corporation, whether evidenced by promissory note or other writing, as well as any stocks, bonds or securities issued by any other than Bright Star Battery Company or Bright Star Warehouse Company, as well as the proceeds of any policy or policies of life insurance on my life, which may at the time of my decease be payable to my estate, and all income, interest, dividends and accumulations on any of the items in this subdivision mentioned, shall be held in trust for my beloved son, Jacob Koretzky, but nevertheless, subject to the provisions hereinafter set forth.
“(b) Of my stockholdings in Bright Star Battery Company, a New Jersey corporation, my said trustees shall hold twenty thousand (20,000) shares, together with all dividends and income therefrom, for the benefit of my said son Jacob Koretzky, but also subject to the provisions hereinafter set forth.
“(c) Of my stockholdings in Bright Star Warehouse Company, a New Jersey corporation, my said trustees shall hold six (6) shares, together with all dividends and income therefrom, for the benefit of my said son Jacob Koretzky, but also subject to the provisions hereinafter set forth.
“(d) My said trustees are hereby vested with absolute discretion in their sole and exclusive judgment to apply and pay over such part of the accumulations, income, interest or dividends or capital for the benefit of my said son Jacob Koretzky, as to them may seem necessary or proper, for his maintenance, support or education, or for the support, maintenance or education of his wife and child or children, should he have any, until my said son shall become of the age of forty (40) years; whereupon my said trustees may turn over to him, my said son, all of the trust fund hereby provided for him, with all accumulations thereon. Should my son die before attaining the age of forty (40) years, leaving him surviving a child or children, then I direct my trustees to hold all of the then remaining portion of my estate, so provided for the benefit of my son, for the like benefit of such child or children of my said son, who shall survive him, in equal shares, to be delivered with all accumulations thereon, when the youngest of my said son’s children shall have attained the age of twenty-one years; but until the time for such ultimate distribution shall arrive, to provide such reasonable support, maintenance and education of my son’s child or children, out of the same as in the discretion of my trustees shall seem proper.
“(e) That of the remaining of my stockholdings in the Bright Star Battery Company and Bright Star Warehouse Company, both New Jersey corporations, whether standing in my name or in the name of another, but in which I own the equitable interest, I do give and bequeath unto my daughters, Anne Barash, Lillian Horton and Jeanette Poliak, in equal shares. My said trustees shall hold the shares bequeathed to my said daughters under this subdivision, with all accumulations and dividends thereon, and from time to time apply the income or dividends therefrom toward the support and maintenance or my said daughters, each out of her respective share, and shall turn over to each of my daughters the share to which she is entitled, together with any accumulations accrued thereon, upon her attaining the age of forty (40) years. Should any of my daughters die before having attained the age of forty (40) years, leaving her surviving a child or children, then I direct my trustees to hold all of the then remaining portion of my estate, as provided for the benefit of my said daughters respectively, for the like benefit of such child or children of said respective daughters, who shall survive her, in equal shares, to be delivered with all accumulations thereon, when the youngest child of such daughter shall have attained the age of twenty-one (21) years, but until the time for such ultimate distribution shall arrive, to provide such reasonable support, maintenance and education of the child or children of such daughter, out of the same, as in the discretion of my trustees shall seem proper.”

There is no donbt that before he died Koretzky had determined to make changes in his will. These changes he discussed with his attorney, Gross, and also with his son Jacob. Among other things, he had decided to remove Kislak and Kadison as executors. However, he died before these changes had been accomplished.

The Warehouse Stock.

Originally the 10 shares of stock of the Warehouse Company were issued to Israel Koretzky, Abraham I. Barash and Dougal Herr. Koretzky had 5 shares, Barash 4 shares and Herr 1 share. The shares of Barash and Herr were subsequently endorsed over to Koretzky. These 5 shares were turned in to the company and a new certificate for 5 shares was issued to Koretzky so that at the time of his death all of the stock of the Warehouse Company was in the name of Israel Koretzky.

During the war, young Koretzky served in the Air Corps. In May, 1944, the bomber to which he was attached crashed in Wyoming. Of a crew of eleven, seven were killed. Jacob Koretzky was one of those who escaped, but his injuries were sufficiently severe to keep him in the hospital for a number of months. Upon hearing of the disaster the elder Koretzky rushed out to Wyoming and when there summoned his daughters. They all responded and joined their father. Upon their arrival at Casper the daughters found their father in a very happy and expansive mood. He had learned that day that his son would recover. An impromptu party ensued, during the course of which Koretzky told his daughter's Lillian and Jeanette that he was determined to leave control of the battery business to Jacob, but was going to devise the “buildings” to his four children equally. During the ensuing months Koretzky repeated this statement to various people. But, again, he died before he had carried out this intention.

• In January, 1946, about two weeks after the death of Israel Koretzky, Horton and Barash had a meeting. The stock certificate book of the Warehouse Company and the certificates for 10 shares, registered in the name of Israel Koretzky, were removed from the office safe where they had reposed for a number of years. The certificates for 10 shares in Koretzky’s name, which had not been endorsed by him, were marked “cancelled” and a new certificate for 6 shares was issued to each of the four children, Anne Barash, Lillian Horton, Jeanette Poliak and Jacob Koretzky. The four certificates are all dated July 24, 1943, although the evidence is undisputed that they were actually issued in January, 1946.

After the probate of the will, the executors investigated the circumstances surrounding the transfer of the stock. Demands for the return of the stock certificates were made upon the children. The demands were refused and ultimately the action for the return of the stock was filed.

Oddly enough, the executors during the course of the trial sought valiantly to convey the impression that Barash was an unwilling participant in the stock transfer scheme. The record does not support the contention. Both Barash and Horton were aware of the declarations of the elder Koretzky concerning his intention to divide the warehouse stock equally among his four children. They were determined that that intention should be carried out and the transfer of the stock was made with that end in view. Fearful that the death of Koretzky would frustrate their plans, they invented the story of a directors’ meeting in 1943 at which Koretzky ordered the transfer. They back-dated the certificates to support that story. Barash was a willing participant in the transaction. His change of heart came after suit was started.

The transfer of the warehouse stock cannot stand. While it may be conceded that Israel Koretzky intended to divide the stock equally among his children, he died before he had given effect to that intention. I am satisfied that he never surrendered dominion over or control of the warehouse stock. Possession of that stock was essential to the control of the Warehouse Company. And in that company Koretzky was the dominant figure until his death.

Even if we give full credence to the story of Horton as told at the trial, that Koretzky gave him the warehouse stock with instructions to divide it among the children if anything happened to him, we can only conclude that Koretzky attempted to make a testamentary disposition without the formalities attendant upon the execution of a will. Nowhere in Horton’s testimony is there any suggestion that the stock would not have been returned had Koretzky demanded it.

■ The transfer of the Warehouse stock will be set aside. Heyer v. Sullivan, 88 N. J. Eq. 165 (Ch. 1917) ; affirmed, 88 N. J. Eq. 595 (E. & A. 1917); Swayze v. Huntington, 82 N. J. Eq. 127 (Ch. 1913); affirmed, 83 N. J. Eq. 335 (E. & A. 1914).

At this point it is only fair to point out that while the executors, in their complaint, charged the children of Israel Koretzky with fraud in connection with the issuance of the disputed certificates of stock of the Warehouse Companj1, the record fails to support any such contention. In fact, during the trial the executors conceded that none of the Koretzky children had had any part in the issuance of the stock and that charges of fraud on their part were without foundation.

The Barash Payment.

During the summer of 1945 the Battery Company suffered a disastrous fire. The insurance payments ultimately received totaled about $670,000. According to the story told by Barash, Israel Koretzky called him into his cottage while the fire was still burning, and told him that for several years he, Koretzky, had been desirous of making some return to Barash for the many years of faithful service which Barash had rendered. The insurance money, he said, would provide the opportunity for Koretzky to realize his desire. Accordingly, he told Barash that after the fire adjustment Barash would receive a present of $25,000. Gross, Kadison and an insurance adjuster named Holland, testified that Koretzky had expressed to them his desire to reward Barash with a gift of $25,000. They all testified that the basis for Koretzky’s determination to make the gift was the service rendered by Barash in connection with the adjustment of the fire loss. Prior services were not mentioned.

In any event, at a meeting held shortly after Israel Koretzky’s death, at which Gross, Kadison, Horton, Jacob Koretzky and Barash were present, Barash broached the subject of the $25,000 gift. At that time both Gross and Kadison recalled that Israel Koretzky had expressed his intention to make such a gift. Gross testified that young Koretzky also remembered statements by his father to that effect. This, Koretzky denies. Be that as it may, Gross drew a paper by the terms of which the children as beneficiaries under the Koretzky will, approved of an arrangement whereby the account of Israel Koretzky with the Bright Star Battery Company was to be charged with a payment of $25,000 which would be credited to the account of Abraham I. Barash. All of the children signed the consent and Barash, on January 31, 1946, about a week before the will was probated, drew and cashed a Battery Company check to his order for $25,000.

Thereafter Kadison caused entries to be made in the books of the Battery Company, charging $25,000 to the account of Koretzky and crediting a like amount to the account of Barash. The entries, although actually made in January, 1946, were entered in the books as of November, 1945. Kadison testified that this was done because the books had not been written up for November. He stated that Koretzky had authorized the transaction at a conference he had with Kadison in the company offices in November. Since, however, Koretzky had left for Florida in October, it is difficult to understand how this conference could have taken place. In all of this there is a suggestion of irregularity which is not satisfactorily explained.

At the trial the executors first sought to defend the Barash payment upon the ground that it was a completed gift. When that theory became untenable, they fell back upon the consent signed by the beneficiaries. That consent, Jacob Koretzky, the plaintiff in the second suit, seeks to have voided.

As has been said, the consent to the payment of the $25,000 to Barash was dictated by Isaac Gross. He had been the confidential legal adviser of Israel Koretzky for many years. He was one of the executors and counsel for the estate. It was only natural for young Koretzky to look to Gross for advice. Yet when Barash asked for the $25,000, that advice was not forthcoming. Gross did not tell Jacob Koretzky that the gift to Barash was probably unenforceable. He did not point out that in all likelihood the burden of the $25,000 payment would fall upon Jacob Koretzky. All Gross did was to dictate the consent and have it signed by young Koretzky. In his ignorance, Jacob Koretzky signed the consent. After receiving independent legal advice he repudiated the consent. In my opinion, that repudiation should stand. McAllister v. McAllister, 120 N. J. Eq. 407 (Ch. 1936); affirmed, 121 N. J. Eq. 264 (E. & A. 1936).

The Removal Proceeding.

The prayer for the removal of the executors and for a restraint against their qualification as trustees is based upon two grounds. The executors are charged with, improper conduct in the administration of their office. And it is also alleged that they have caused such an atmosphere of distrust, hostility and lack of confidence to arise between themselves and Jacob Koretzky that a proper administration by them of the trust is no longer possible.

That hostility and lack of confidence may exist between the executors as such, and Jacob Koretzky, is not a compelling reason for their removal. The duty of the executors is to collect the assets, pay the taxes, debts and legacies and turn the residue over to the trustees for administration. Bad feeling between the executors and the beneficiaries, however deplorable, need not hamper the efficient administration of the estate.

The first charge is that the executors have failed to proceed promptly with the execution of their duties. The executors retort, with some force, that they could have progressed more rapidly if they had not been required to spend so much time trying to obtain the warehouse stock. With that stock in their possession, the executors can proceed promptly with the liquidation of the tax liabilities and the completion of their duties.

The payment of $25,000 to Abraham Barash has already been discussed. The claim of the Battery Company against the estate for reimbursement has not been approved for payment by the executors, and, under the circumstances, it is not likely that the claim will be approved.

It is also charged that Gross and Kadison used their position as executors to secure extra compensation for themselves from the Battery Company. For some years prior to Koretzky’s death, the firm of Gross & Gross had acted as attorneys for the Bright Star Battery Company. For their services they received an annual retainer of $2,400 and a bonus each year of $1,500. After Koretzky’s death the board of directors of the Battery Company, of which both Gross and Kadison were members, set the Gross retainer at the sum of $3,900 and discontinued the bonus. At the same time Kadison’s compensation was increased $4,000.

As the holders of a controlling interest in the Battery Company, Gross and Kadison were in a position to dominate the board, and their action in permitting the increased compensation to be voted was very indiscreet and surprising in view of their experience. But there is nothing in the record from which a conclusion can be drawn that the increased compensation was not earned.

I am of the opinion that the charges of misconduct levelled against the executors are not of sufficient gravity to justify their removal. No useful purpose would be served by such a course and the estate would be saddled with extra expense without corresponding benefit.

There remains for consideration the relationship presently existing between the executors and Jacob Koretzky and its effect upon their availability for services as trustees. That a state of utter discord exists is apparent from the most casual reading of the record. From the very outset, the executors have displayed toward young Koretzky a hostility surprising in its intensity. They have made no attempt to conceal their contempt for him and have rigidly suppressed any attempt on his part to assert himself.

Shortly after his father’s death, Jacob Koretzky had been elected a director and secretary of the Battery Company. Within a month after the executors qualified, he was removed. He was retained in the employ of the company for a year at an increased salary and was then discharged. Following his discharge, he was barred from entering the company property. He presented to the executors for payment a promissory note for $5,000, signed by his father which represented Jacob’s share of his mother’s estate. Payment was refused by the executors and he was directed to file a claim. This action contrasted sharply with the informality attendant upon the payment of $25,000 to Barash. And all of this time his retention of the certificate of warehouse stock, like that of his sisters, was being characterized as fraud and the receiving of stolen goods.

The executors say that Jacob Koretzky is too young and incompetent to serve as an officer and director of the Battery Company. No particulars are given. The executors ignore the fact that the appointment was the expressed wish of the testator. And they overlook the further fact that their power to discipline the young man springs solely from their control of stock of which he is the beneficiary. Jacob was discharged because he refused to return the warehouse stock. In doing so he acted under the advice of counsel who maintained and still argue that he is entitled to it. No reason is given for the refusal to pay the note or to grant to Koretzky right of access to the plant.

As a result, there has been built up on both sides a state of complete antagonism. The parties cannot speak civilly to one another. A reconciliation is without the bounds of possibility.

The main asset in the corpus of the trust estate set up by the testator for the benefit of Jacob Koretzky is a controlling interest in the Bright Star Battery Company. The corpus, and with it the control of the business, is to be turned over to Jacob Koretzky when he reaches the age of 40 years. He is now about 25 years old. During the intervening years the trustees are to pay over to Jacob Koretzky such sums as they deem necessary for the support and maintenance of himself and his family.

Implicit in the provisions of the will establishing the trust estate is the testator’s expectation and intention that his son should be given an opportunity to gain knowledge and experience in the business before he is called upon to assume the responsibilities of management. The obligation to provide for and direct this training is placed upon the shoulders of the trustees. Their relationship with the young man is required to be almost that of guardian and ward. To be successful, such a relationship demands a high degree of mutual confidence and respect.

I am of the opinion that an administration of the trust in accordance with the desires of the testator would be impossible of accomplishment by the present executors as trustees. Accordingly, I will restrain their qualification and, at the appropriate time, will appoint a substituted trustee. May v. May, 167 U. S. 310 (1897); Braman v. Central Hanover Bank & Trust Co., 138 N. J. Eq. 165 (Ch. 1946).


source: Caselaw Access Project

author: Joseph L. Smith, J. S. C.

license: Public Domain

text:
    FREDERICK ATANASIO, PLAINTIFF, v. SAMUEL W. SILVERMAN, DEFENDANT.
    Superior Court of New Jersey Law Division .
    Decided December 4, 1950.

      Mr. John G. Flanigan, attorney for the plaintiff (Mr. John Warren, of counsel).

      Mr. Abraham, Natovitz, attorney for the defendant.
   Joseph L. Smith, J. S. C.

The petition to set aside the order for offset is based upon three grounds:

(1) The former Supreme Court did not have jurisdiction to make the order for .offset, said order being entered November 27, 1946, by former Chief Justice Case.

(2) Defendant was not entitled to the relief of offset because of fraud in securing the assignments of the judgments which are the basis for the offset, and because defendant came into court with unclean hands.

(3) The purchase by an employer of claims against his employees and the offsetting of them against unpaid wages is against the public policy of the State of New Jersey.

Each ground shall be discussed in order.

The former Supreme Court of New Jersey was a court of original jurisdiction and as such had jurisdiction over. the subject matter of judgments and offset within its own court. It must be noted that all the judgments obtained and used by either party were obtained in the former Supreme Court.

This is in effect an attempt by the plaintiff to review the decision of the former Supreme Court, and as such this court is without the proper jurisdiction to hear such an appeal. In so far as the instant matter is concerned, the proper procedure should have been an appeal to the former Court of Errors and Appeals. Since the proper avenue of review was not adopted by the plaintiff he cannot now seek to review the proceedings in the former Supreme Court by means of a collateral attack in this court.

Plaintiff bases its claim that the court lacked jurisdiction on their interpretation of R. S. 2 :26-182 to R. 8. 2:26-187.2 inclusive. Now, these statutes deal with the situation wherein a judgment has been obtained by the creditor and he seeks to have “an execution issue against .the wages, debts, earnings, salary, income from trust funds or profits of the judgment debtor.” (R. 8. 2:26-182.)

However, in the instant case there is no such an occurrence. The defendant Silverman did not seek an execution by virtue of R. 8. 2 :26-182 as contended by the plaintiff, but rather the defendant sought to have the judgment secured by the plaintiff against him offset by the judgments he, the defendant, had purchased by assignment. No execution was sought in any form or manner by virtue of R. 8. 2 :26-182.

Trapp v. Brown, 93 N. J. L. 171 (E. & A. 1919), as cited by plaintiff, is not dispositive of the problem presented here. In the Trapp case there was an order of execution against the moneys due or thereafter to become due. And by statute under such an execution only a percentage of the money could be taken now and when it became due and owing to the debtor. In the instant case there was no order for execution — only an order seeking an offset.

It has long been our rule that the right to have one judgment set off against another is within the discretion of the court. Coxe ads. State Bank of Trenton, 8 N. J. L. 172 (Sup. Ct. 1825). Also that a court of equity, in the exercise of a sound discretion, will direct one judgment to be set off against another, whenever such relief does not run counter to any established principle of law or equity. Murray v. Skirm, 73 N. J. Eq. 374 (E. & A. 1908).

I have run across an old line of cases which hold that in an action for assumpsit the judgment or debt to be set off must be due the defendant in his own right. Reeves v. Hatkinson, 3 N. J. L. 751 [Reprint, p. 319] (Sup. Ct. 1811). By the court:

“No doubt but that a judgment is a proper debt to be set off; but a judgment or other debt to be set off, must be due the defendant in his own right; set-off is a contrivance to prevent cross actions,'and thereby to save costs, trouble and expense. We are of the opinion, that it ought to be such a debt as the defendant could bring an action for in his own name. * * *.
“Distinguished in Brown ads. Hendrickson, 10 Vr. 241.” (Brown ads. Hendrickson, 39 N. J. L. 239 (Sup. Ct. 1877).

In McAdams v. Randolph, 42 N. J. L. 332 (Sup. Ct. 1880), . Justice Scudder stated:

“The right to set oif one judgment against another, or, more properly, to pay and satisfy one judgment by another, where the person holding the one judgment is liable under the other, has often been exercised to prevent circuity of action, and to so control the judgment and process of the court as to do justice between the parties. * * *
“I think this defendant, in the judgment against him, which has been assigned in good faith, has no right or equity to offset against it a judgment which he purchased subsequent to such assignment, doubtless for the very purpose of using it in this form.
“The order for set-off will be refused.”

Since the original action in this matter was involving set-off and not execution, thereby by-passing plaintiff’s claim of the court lacking jurisdiction, we are still confronted with the various claims of the plaintiff whereby he demands relief.

“Rule 3 :12-8. Waiver of Defenses :

“A party waives all defenses and objections which he does not present either by motion as hereinbefore provided or, if he has made no motion, in his answer or reply, except * * * (2) that, whenever it appears by suggestion of the parties or otherwise that the court lacks jurisdiction of the subject matter, the court shall dismiss the action. * * 1

I cannot see any basis for the jurisdictional question raised by the plaintiffs so therefore it seems to me that the opening sentence of the rule controls and all his defenses and objections are waived. A set-off is a partial or entire defense within the meaning of this rule, requiring all defenses to be presented either by motion, answer or reply. Chicago Great Western Ry. Co. v. Peeler, 140 F. 2d 865 (C. C. A. Minn. 1944).

Apparently plaintiff is relying on Rule 3 :60-2 (4) in seeking to have the order set aside.

'‘Hule 3:60-2. Mistakes; Inadvertence; Excusable Neglect; Newly Discovered Evidence; Fraud, etc.
“On motion and upon such terms as are just, the court may relieve a party * * * from a final judgment, order or proceeding for the following reasons; (1) mistake, inadvertence, surprise, or excusable neglect; (2) newly discovered evidence * * *; (3) fraud, * * *, misrepresentation, or other misconduct of an adverse party; (4) the judgment or order is void; (5) the judgment or order has been satisfied, * * *; or (6) any other reason justifying relief from the operation of the judgment or order. * *

From a reading of the affidavits and briefs, coupled with the former cases rising out of this situation, Atanasio v. Silverman, 24 N. J. Misc. 390 (Sup. Ct. 1946), and Atanasio v. Silverman, 1 N. J. 245 (Sup. Ct. 1949), I cannot see where any of the grounds listed in Rule 3:60-2 could be sustained by the plaintiff.

From a reading of the prior two cases in this suit it appears that the court, at all times, was aware of the fact that the defendant had purchased at a nominal price the judgments used by himself as the basis for a set-off. Such a knowledge seems to forestall any claim of fraud. This is accentuated by the fact that none of the assignors have complained and have not charged the assignee, Silverman, with any misrepresentations. Only the plaintiff, Atanasio, who has been greatly affected by the prior useless judgments, has been heard to cry fraud.

As to the claim of unclean hands, little can be said for either party.

It appears from the letters in the file that the plaintiff had judgments docketed against him from $60,000 to $300,000 (no direct evidence of the exact amount) all unpaid.

Lastly, as to the violation of public policy as alleged by the plaintiff, in Fidelity Union Trust v. Reeves, 96 N. J. Eq. 490 (Ch. 1924) ; affirmed, 98 N. J. Fq. 412 (E. & A. 1925), it was held that the principles and doctrine of public policy are matters of common and professional knowledge. 11 Am. Jut., Constitutional Law, § 139, Public Policy,” at page 814:

“In order to ascertain the public policy of a state with respect to any matter, the acts of the legislative department should be looked to, because a legislative act, if constitutional, declares in terms the policy of the state and is final so far as the courts are concerned. With the foregoing considerations as its basis, the rule has become securely settled that all questions of policy are for the determination of the legislature, and not for the courts.”

It appears that the public policy of this State, embodied in R. S. 2:26~190, 191 and 192, is in favor of the granting of a set-oif. Said statutes deal with the right to set-off by mutually indebted persons.

The petition to set aside the order for offset is denied.


author: Proctor, J. S. C.

text:
    JOHN C. TALTY, PLAINTIFF, v. BOARD OF EDUCATION OF THE SCHOOL DISTRICT OF THE CITY OF HOBOKEN, DEFENDANT.
    Superior Court of New Jersey Law Division
    Decided December 21, 1950.

      Mr. Joseph P. Hanrahan, for the plaintiff.

      Mr. Thomas J. Brogan, for the defendant.
   Proctor, J. S. C.

On September 1, 1939, plaintiff, an honorably discharged veteran of World War I, was appointed medical inspector in the school system of Hoboken by resolution of the board of education. No term was fixed by this resolution nor by any subsequent resolution. Plaintiff served as medical inspector until July 1, 1949, when his appointment was terminated by a resolution adopted by defendant board on June 20, 1949.

Plaintiff was appointed pursuant to B. 8. 18:14^56, which, in 1939, provided:

“Every board of education shall employ a competent physician to be known as the medical inspector, and may also employ a nurse, and fix their salaries and terms of office. The board of education may appoint more than one medical inspector and more than one nurse.”

In 1947 the statute was amended requiring the medical inspector to be licensed to practice medicine and surgery within the State. P. L. 1947, c. 148, p. 641, § 23. This amendment is not pertinent.

The sole issue in this case, as set forth in the pretrial order, is whether or not the plaintiff has tenure by reason of his status as an honorably discharged veteran under B. 8. 38 :16-1, as amended P. L. 1942, c. 83, p. 326, ■§ 1.

It has been adjudicated that a local board of education is a non-continuous 'body of necessity organizing each year and that the board has no power to fix a term for medical inspector beyond the life of the board. Skladzien v. Board of Education of Bayonne, 12 N. J. Misc. 602 (Sup. Ct. 1934); affirmed, 115 N. J. L. 203 (E. & A. 1935). It has also been determined that if the board, in the appointing resolution, fails to fix the term then, in the absence of statute, presently in force, or ordinance or rule under legislative sanction, the term is for one year, being coterminus with that of the appointing power. Evans v. Board of Education of Gloucester City, 13 N. J. Misc. 506 (Sup. Ct. 1935); affirmed, 116 N. J. L. 448 (E. & A. 1936).

If the rulings in the above decisions were controlling at present, it is. clear that plaintiff’s appointment would be construed as being for a fixed term, and consequently he would be excluded from the protection of B. 8. 38:16 — 1 (Veterans’ Tenure Act), as this act does not apply to an appointment for a term “fixed by law.”

However, in 1942 B. 8. 38:16-1 was amended as follows:

“Eor tbe purposes of this section (R. S. 38:16-1) no term of office, position or employment of any person shall be deemed to be fixed by law or coterminus with that of the employing or appointing board or body by reason of the fact that such person was or is appointed or employed by a noneontinuous board or body; provided, hoxoever, that in no event is it intended that this act shall apply to appointments made for a fixed or stated period of time.” (P. L. 19-12, c. 83, p. 326, § 1.)

Therefore, it is clear that by the above amendment the intent of the Legislature was to nullify the effect of the SMadzien and Evans cases, supra, where the appointee is an honorably discharged veteran and where the statute does not require the appointing power to ñx a term and the resolution, appointing him, did not fix a term. Fox v. Board of Education of Newark, 129 N. J. L. 349 (Sup. Ct. 1943); affirmed, 130 N. J. L. 531 (E. & A. 1943). Cf. Burke v. Kenny, 9 N. J. Super. 160 (App. Div. 1950); Board of Fducation of Cedar Grove v. State Board of Education, 115 N. J. L. 67 (Sup. Ct. 1935).

Defendant attempts to distinguish Fox v. Newark, supra, from the present situation on the ground that in that case the plaintiff was appointed under B. S. 18:6-27, whereby the board was empowered to appoint certain executives, * * and other officers, agents and employees as may be needed, and may fix their compensation and terms of employment * * *;” that the above provision did not require the appointee be named for a fixed term, and, therefore, Pox, a veteran, was protected by B. S. 38 :16 — 1. Defendant argues that R. S. 18:14-56 requires the term of medical inspector to be fixed and urges that the office is beyond the protection of the Veterans’ Tenure Act, notwithstanding that no term was actually fixed by the appointing power.

However, our Court of Errors and Appeals has construed R. S. 18:14-56 as granting the board of education the right of administration only, with its essential incidents, which do not possess the quality of legislation. Skladzien v-Board of Education of Bayonne, supra. This interpretation of the statute was not nullified by the 1942 amendment to the Veterans’ Tenure Act (B. S. 38:16-1). Therefore, it appears that R. S. 18:14-56 did not require the board to fix a term for the office of medical inspector, but it did empower the board to fix a term for the board’s duration or for a period less than its duration. This power is an essential incident of administration. Eo term having been fixed by the resolution apiDointing plaintiff to the office, it may reasonably be said that the Legislature intended, in enacting the amendment of 1942 (P. L. 1942, c. 83), to protect an honorably discharged veteran in. such a situation as is now before the court.

Defendant further attempts to distinguish the Fox ease on the basis that the Legislature intended Eox to have tenure because of the following language in the statute (B. S. 18:6-27): “* * * Eo such employee shall be dismissed or subjected to reduction in salary except for inefficiency, incapacity * * * and after a written charge of the cause * * * shall have been preferred against him or her * * The above language applies only to persons holding secretarial or clerical positions. Eox was not in either category, but was “legal assistant to the Board of Education.”

Defendant contends that the case of Burhe v. Kenny, supra, is dispositive of the present case. The writer of this memorandum sat as the trial judge in that case. In the Burhe case the Appellate Division held that the statute, B. 8. 40:73-7, bestowed upon the commissioners of Jersey City not only the power but also the duty to fix the term of office of city clerk; therefore, the appointment was' considered to be “for a fixed or stated period of time” and was not embraced within the legislative intent as expressed in B. 8. 38:16 — 1. In the present case, I find no legislative mandate to the board to fix a term for a medical inspector. True, the board is required to appoint a medical inspector. However, it “may” appoint a nurse. The clause “and fix their salaries and terms of office” refers to both medical inspector and nurse. I see nothing mandatory about this provision, especially when it has been determined that the board has no legislative power to fix a term. 81cladzien v. Board of Education, supra.

In the light of the existing law, as declared in the 81clad-zien and Evans cases, supra, at the time the 1942 amendment was enacted, it is reasonable to assume that the Legislature intended that honorably discharged veterans would be in a class protected by tenure, when appointed under R. 8. 18:14-56, where no term is fixed in the appointing resolution.

The plaintiff is entitled to judgment.


author: Daniel J. Brennan, J. S. C.

text:
    BEN RABIN, PLAINTIFF, v. JOHN K. POLLIT AND ELDEN M. SHONKA, DEFENDANTS.
    Superior Court of New Jersey Law Division
    Decided December 21, 1950.

      Mr. Harry Green, attorney for plaintiff.

      Mr. John Alden Christie (Mr. Gerald T. Foley, of counsel), attorney for defendants.
   Daniel J. Brennan, J. S. C.

This is an application for a change of venue. The action is for slander of the plaintiff by the defendants, who are or were at the time of the alleged slander officials of the Borough of Eairlawn in the County of Bergen, the defendant Pollit the mayor thereof and Shonka a councilman.

Venue was laid in Essex County. Counsel for the defendants suggests that there is a right on the part of the defendants to have the cause tried in the county of their residence, to wit, Bergen County. In support of this viewpoint counsel for the defendants quotes in his brief what he contends is ‘the pertinent part of Rule 3 :3-2 of the Superior Court — title Venue.

“In actions affecting the title to real property or an interest therein possessory or otherwise, or for damages thereto, and actions of attachment the venue shall be laid by the plaintiff in the county in which any property affected is situate. In actions by or against municipal corporations or counties or public agencies or officials the venue shall be laid by the plaintiff in the county in which the cause of action arose.” (The italics is the court’s.)

An examination of the complaint discloses that in the first count it is alleged that the defendant Pollit is the mayor of the Borough of Eairlawn and that the defendant Shonka is a duly elected councilman of that borough, and that in the third and fourth counts reference is made to their official status. It is the court’s judgment that these defendants are sued as individuals and not in their representative capacity. The alleged slanderous words were uttered at public meetings in that borough on the dates stated in the complaint.

Prom its context it seems to me that the excerpt from the rule heretofore cited has reference only to those situations where public officials are sued in their capacity as such.

There is but a single case cited by learned counsel for the defendants, Dennis and Shorts ads. Charles Ford, 7 N. J. L. 200 (Sup. Ct. 1824). In that ease a deputy sheriff of Sussex County was sued by a resident of Morris County and the venue was laid in Morris County. He was sued in his capacity as a civil officer and the cause for which suit was instituted was for an act in the performance of his duty as such. The court, indicating it would be a great hardship to take him out of his county, granted the application for a change of venue. Such is not the situation here. The cited case supra does not apply.

The motion for a change of venue isf denied, without costs.

Submit order accordingly.


author: Donges, A. J. S. C.

text:
    NEW JERSEY BELL TELEPHONE COMPANY, A CORPORATION, PLAINTIFF, v. PENNSYLVANIA-READING SEASHORE LINES, A CORPORATION, AND MARTIN RAGEN, INDIVIDUALLY AND TRADING AS RAGEN’S TRANSPORTATION COMPANY, DEFENDANTS.
    Superior Court of Now Jersey Law Division
    Decided December 29, 1950.

      Messrs. Thomas N. Bantivoglio and James Hunter, 3rd, for plaintiff (Messrs. Boyle, Archer & Greiner, attorneys).

      Mr. Blaine E. Capehart and Grace Heritage Smith for defendant, Pennsylvania-Reading Seashore Lines (Messrs. Richards, Capehart, Smith & Wood, attorneys).

      Messrs. William G. Bischoff and Horace M. Shell, of Philadelphia, Pa., for defendant, Martin Ragen, individually and t/a Ragen’s Transportation Co. (Messrs. Carroll, Taylor & Bischoff, attorneys).
   Donges, A. J. S. C.

This suit was instituted on three counts. The first two counts are predicated upon the provisions of the Interstate Commerce Act, 49 U. S. C. A., § 1 et seq. The first count seeks recovery from the Pennsylvania-Heading Seashore Lines, and the second count seeks recovery from Martin Hagen, individually and trading as Hagen’s Transportation Company. The third count is against Hagen and seeks recovery on the theory of negligence.

The case was tried without a jury. Pursuant to Rule 3 :52-l of the Eules of Civil Procedure, this court makes the following findings of fact:

On April 18, 1947, United States Motors Corporation shipped in interstate commerce one crate containing a generator engine from Oshkosh, Wisconsin, to the plaintiff in Vine-land, New Jersey, under a uniform straight bill of lading. The car containing the crate arrived at Vineland, New Jersey, on May 5, 1947, and was placed at the public delivery track on May 7, 1947.

On May 8th, employees of the defendant Martin Eagen, appeared at the freight station for the purpose of taking the crate to plaintiff’s premises, which were also located in Vine-land. These employees testified that they saw the crate in the railroad car and that it had broken loose from its moorings and was “on an angle.” Some of the slats on the outside crate were broken, and there were floor marks showing that the crate had shifted in the car. The man in charge of Eagen’s employees, a Mr. Quinn, reported the condition at the freight office and was told it was all right. Eagen’s employees then proceeded to load the crate on their truck.

The truck was then driven to Eagen’s garage where it remained for about a week, due to a strike at the plaintiff’s premises. There was testimony that Eagen’s men were careful in the entire process of removing the engine from the freight yard to the plaintiff’s premises and that no damage occurred to it during that time. The true extent of the damage was not discovered until the engine was uncrated at plaintiff’s premises.

The damage was stipulated to be $1,426.76. It was also stipulated that the engine was delivered in good condition to the initial carrier.

It is important to note at the outset that Eagen’s Transportation Company was performing a local service for plaintiff, in transferring the engine from one section of Vine-land to another. It is, therefore, not a carrier subject to the provisions of 49 U. S. C. A., § 1 et seq., nor is it entitled to the provisions of the bill of lading. In order to hold Eagen responsible in damages, it is necessary for plaintiff to show at least that the damage was done while the machinery was under his control. McMahon v. American Ry. Express Co., 6 N. J. Misc. 468 (Sup. Ct. 1928); 13 C. J. Secundum, § 84, p. 168. The facts in this case do not support this allegation. I find as a fact that the machinery was damaged before Eagen gained control thereof. Lor this ieason, a judgment of no cause of action will be entered in favor of the defendant Eagen.

The defendant, Pennsylvania-Eeading Seashore Lines does come within the provisions of 49 U. S. C. A., § 20 (11). Under this federal statute, the delivering carrier, under an interstate contract of affreightment or through bill of lading, is liable for goods lost or damaged in transit by it or by any of the common carriers to which such property may be delivered or over whose lines such property may pass. 49 U. S. C. A., § 20 (11), as amended July 3, 1926, c. 761, 44 Siat. 835; March 4, 1927, c. 510, § 3, 44 Stat. 1448; April 23, 1930, c. 208, 46 Siat. 251. See also 13 Corpus Juris Secundum, Carriers, § 424b (2), pp. 929 and 930. It, therefore, follows that in such cases it is only necessary for the consignee to allege and prove (1) that the initial carrier received the shipment in good condition, (2) that the shipment arrived at its destination in a damaged condition, and (3) the amount of loss.

Since the Pennsylvania-Eeading Seashore Lines was the delivering carrier in this case and since the first and third elements enumerated above have been stipulated, the only important factual question remaining is the condition of the machinery when it arrived at Vineland. I have found that the damage occurred prior to delivery to Eagen and, therefore, at some time prior to its delivery at Vineland.

Accordingly, judgment will be entered in favor of plaintiff and against the defendant Pennsylvania-Eeading Seashore Lines in the amount of $1,426.76.


text:
    JOSEPH GEIGER, PLAINTIFF, v. OTTILIE K. METZ, INDIVIDUALLY, AND AS EXECUTRIX OF THE ESTATE OF PETER W. METZ, AND HERMANN H. METZ, DEFENDANTS.
    Superior Court of New Jersey Law Division
    Decided December 14, 1950.

      Mr. Hyman H. Bernstein, attorney for the plaintiff.

      Messrs. Mills, Jeffers & Mountain (Mr. Worrall F. Mountain, Jr., appearing), attorneys for the defendants.
   Joseph L. Smith, J. S. C.

This matter comes before the court on motion for summary judgment in behalf of the plaintiff, relying upon the affidavit attached to said motion, oral argument and briefs.

It seems to me that a question that eventually must be considered by the court is whether or not the rights of the plaintiff under the chattel mortgage were merged in the judgment recovered by the plaintiff against the defendant.

Corpus Juris' Secundum, vol. 14, Chattel Mortgages, page 1071, states:

“The mortgagee does not get legal title to the property under a judgment of foreclosure, but only a lien on the property, and the mortgage becomes merged in the judgment and has no further vitality as long as the judgment stands.”

Citing in the footnotes: Spokane Merchants Ass’n. v. Colville First Nat. Bank, 86 Wash. 367, 150 P. 434.

American Jurisprudence, vol. 30, Judgments, § 158, page 906:

“Upon the merger of a cause of action in a judgment, the old debt ceases to exist and the new judgment debt takes its place. The judgment becomes the evidence of the debt, or the sole test of the rights of the parties, in the sense that a proceeding in reference thereto should be founded on the judgment. However, the merger of a cause of action in a judgmnt does not mean an annihilation and discharge of the debt, * * *.”

And page 907:

“160. Security for Original Debt. The general rule is that a lien securing a debt which becomes merged in a judgment is not affected by such merger. If a debt is of such a character that a lien is given by common law or statute, the merger of the judgment does not involve a merger of the lien, and the latter may continue until the debt is satisfied.”

And Ruling Case Law, vol. 21, Pledge, § 18, page 653:

“* * * The rule that a collateral security can be held or applied only upon the obligation which it was given to secure does not, however, prevent its retention for and application to the satisfaction of that obligation in any changed form. Thus though the principal debt is prosecuted to, and merged in, a judgment, the right to hold the security is not lost. It may be held for and applied to the satisfaction of the judgment. 32 A. S. R. 717.”

I now refer counsel to the rule under election of remedies, cited in Corpus Juris Secundum, vol. 28, page 1063 :

“b. The doctrine of the election of remedies, that the pursuit of one remedy will exclude the pursuit of another, applies only to those cases in which the party has two or more remedies which are inconsistent with each other, and has no application to a state of facts where the remedies available to him are concurrent and consistent. Where the law furnishes a party with two or more concurrent and consistent remedies he may prosecute one or all until satisfaction is had; but a satisfaction of one is a satisfaction of all. He may select and adopt one as better adapted than the others to work out his purpose, but his choice is not compulsory or final. Where the remedies afforded are inconsistent, it is the election of one of such remedies which operates as a bar; but where the remedies afforded are consistent, it is the satisfaction of the claim which operates as a bar.
“In accordance with the foregoing rules, a creditor may pursue more than one remedy at the same time if reasonable and necessary to collect debts, where none is oppressive and vexatious. So, where a creditor has collateral security for his claim, he may prosecute simultaneously whatever actions in law or equity he may have on the principal or collateral obligations; and a creditor who holds several securities for the same debt has the right to realize the payment of his claim from any of them.”

Rossiter v. Merriman, 80 Kan. 739, 104 P. 858 (Sup. Ct. 1909). In a suit upon a mortgage and note, the court stated in reference to the lower court’s action:

“The appellant was denied a foreclosure of this mortgage, not because of waiver, extinguishment, or satisfaction, but because the note for the payment of which the security was given had become merged in the personal judgment rendered * * *. It is also clear that, when the * * * note was reduced to judgment, it became merged in the judgment, and could not thereafter he made the foundation of a subsequent cause of action. (Cases omitted.) However, the merger and extinguishment of the note did not discharge the debt nor extinguish the mortgage. The form of the debt was changed, but the debt itself for which the mortgage was security remained in full force * * *.”

And át page 860:

“* * *. jn jowa it was held that ‘the holder of a note secured by a mortgage may take judgment upon the indebtedness due at law without thereby waiving or releasing the lien of the mortgage, and may subsequently, if he sees fit, bring his action to foreclose such lien within the life of the judgment thus procured.’ Gilman v. Heitman, 137 Iowa 336 * * *. In Priest v. Wheeloek, 58 Ill. 114, where the effect of taking judgment upon a note was considered, it was said that ‘that instrument was given to secure the debt, and it was immaterial what form it assumed whether an account, note, or judgment. The substance, and not the mere form, is regarded in equity, and hence the pledge was to secure the payment of the money, and not a mere extinguishment of the note by the debt assuming another form. Because the judgment extinguished the note, it does not follow that the mortgage was discharged, or the lien it created on the premises was extinguished. The lien on the lots still continued to secure the payment of the debt then evidenced by the judgment.’ In I Jones on Mortgages, Section 936, there is a statement of the general rule, well supported by authorities, that ‘the merger of a note in a judgment does not extinguish the debt, and the mortgage continues a lien until it is satisfied or the judgment is barred by the statute of limitations.’ (Oases omitted.) * * * On these facts and the authorities cited the appellant is entitled to recover the debt evidenced by the judgment, and to a foreclosure of the mortgage given to secure the debt * * *. Judgment reversed * *

It may well be that the plaintiff had the right to bring either action he chooses, execution and levy under the judgment or sale under the Chattel Mortgage Act, and that if one action is unsuccessful he may proceed with the other. However, the plaintiff chose to satisfy the debt by a sale, upon notice under the Chattel Mortgage Act.

After forfeiture, the title of a mortgage to chattels mortgaged is absolute at law, and he may, upon due notice to the mortgagor, sell them for the satisfaction of his debt without the aid of a Court of Chancery. Hall v. Bellows, 11 N. J. Eq. 333 (1857); Long Dock Co. v. Mallery, 12 N. J. Eq. 431 (1858); Chapman v. Hunt, 13 N. J. Eq. 370 (1861); Bird v. Davis, 14 N. J. Eq. 467 (1862); Freeman v. Freeman, 17 N. J. Eq. 44 (1864).

In Freeman v. Freeman, supra, Chancellor Green held, at page 47:

“* * * A sale of the chattels by a mortgagee or pledgee, in the absence of statutory regulations, is attended with some difficulty and embarrassment. The conduct and fairness of the sale, and the rights acquired under it, are always open to investigation at the instance of the mortgagor or pledgor. Morris Canal & Banking Co. v. Fisher, 1 Stockt. 667, 687-9; Same v. Lewis, 1 Beas. 823. On these accounts a sale under judicial sanction is safer, and where the amount is large, advisable.”

Tti Bird v. Davis, supra, Chancellor Green said, at page 474:

“After forfeiture, a mortgagee in possession may make sale of the chattels mortgaged upon due notice thereof to the mortgagor. But the creditor will be held, at his peril, to deal fairly and justly with the property, both as to the time of the notice and the maimer of the sale. 2 Story’s Eq. Jur., section 1031; Story on Bailments, section 310, and note 4, 2 Kent’s Com. 583. * * *.”

And at page 475 he further said:

“* * * If, however, the defendant can show before the master that the articles were sold unfairly, and at an under price, he will be permitted to do so, and will be allowed their fair value. So, also, he will be permitted to show that the commissions and charges made upon the sales at auction v-ere unusual or exorbitant. * *

It is equally well settled that equity will more readily set aside foreclosure sale at which mortgagee is the purchaser. Rosenblatt v. Premier Dyeing Co., 101 N. J. Eq. 569 (1927); Campbell v. Gardner, 11 N. J. Eq. 423 (1857).

From the affidavit of Harry A. Chester, submitted by the defendant, it appears that the chattels in question were appraised at approximately $7,000, $6,000 for the cattle and $1,000 for farm animals and equipment. In light of such evidence a court of equity would no doubt set aside the sale of the chattels in question for the mere sum of $500.

The chattels were purchased by the mortgagee for $500. Thereafter the sum of $450 was deducted for payment to the constable, leaving only $50 to be applied on the judgment. Is this equitable and just?

An equity court might well order a sale under the jurisdiction of the court.

However, the court, at this time, is without the benefit of the necessary evidence which would be present at a trial of the issues. In Louis A. Cross Co. v. Margolis, 136 N. J. L. 453 (Sup. Ct. 1948), Justice Burling stated, at p. 455:

“The legal points that have been raised with respect to the alleged agreement are not presently susceptible of determination until the entire facts are more fully elicited as the result of direct and cross examination of witnesses.”

In this motion for summary judgment there have ,been conflicting versions of the facts presented, which lend to widely varying inferences which may be drawn by the court. A summary judgment should only be granted if it is obvious that there is no genuine issue and that, as a matter of law, the moving party should have judgment (Rule 3:56-3). Hodes v. Dunsky, 5 N. J. Super. 333 (App. Div. 1949); Mitchell v. Wrightstown Community Apartments, 4 N. J. Super. 321 (App. Div. 1949).

The court therefore desires to havé the facts fully presented by trial evidence so that the legal rule may be more intelligently considered and applied.

The motions are denied.


author: Donges, J. S. C.

text:
    SUBURBAN LUMBER COMPANY, A CORPORATION OF THE STATE OF NEW JERSEY, PLAINTIFF, v. VICTOR GERBER, OWNER, AND KARLSTAD BUILDING CO., INC., BUILDER, DEFENDANTS.
    Superior Court of New Jersey Law Division
    Decided January 2, 1951.

      Mr. W. Louis Bossle, attorney for plaintiff.

      Mr. A. David Epstein, attorney for defendant, Victor Gerber (Messrs. Rose & Epstein, attorneys).
   Donges, J. S. C.

The case of Suburban Lumber Company v. Victor Gerber has been submitted to this court upon a written stipulation of facts. The determination of the issues presented herein in no way affects the companion case of Karlstad Building Co., Inc., v. Victor Gerber, nor the case of Suburban Lumber Co. v. Karlslad Building Co., Inc.

The case arose out of a dispute concerning a building contract. The. defendant, Victor Gerber, is the owner of the premises in question. On the 12th day of July, 1949, he entered into a building contract with Karlstad Building Co., Inc., whereby certain work was to be performed. Plaintiff supplied large quantities of material to Karlstad to be used in connection with said work. Plaintiff filed its notice of intention and commenced delivering materials on July 15, 1949. Defendant, Gerber, filed the building contract on August 5, 1949. By that time, plaintiff had supplied $927.42 worth of materials.

Plaintiff now seeks to establish a mechanic’s lien for the entire amount of materials supplied. It is conceded that if the filing of the contract was effective, plaintiff is entitled to a lien for but $927.42, but if the filing was not effective, plaintiff is entitled to a lien for the full amount of the materials supplied. Smith & Richards Lumber Co., Inc., v. Hurley, 116 N. J. L. 429, 185 A. 10 (E. & A. 1936); Davis v. Mial, 86 N. J. L. 167, 90 A. 315 (E. & A. 1914).

The determination of the issue presented depends upon whether Gerber complied with the provisions of R. S. 2:60-115. It is admitted that the contract in the instant case was filed and that the plans were also filed. However, plaintiff claims that no specifications were filed as required by the act. Defendant, on the other hand, argues that the plans incorporate the specifications in conformity with the intention of the parties. The contract and plans have been submitted to the court for its inspection. A careful inspection of this document leads this court to the conclusion that the plans and specifications are incorporated into one document. There are a number of markings on the document which clearly indicate the intention that it shall be a plan and specifications. There was no architect involved in this case. While it may not be as complete nor as artful as might be desired, it is certainly sufficient to meet the requirements of the statute. Nothing contained in our statute indicates that the specifications must be filed as a separate document. Nor does the act state that the specifications must be complete, before an owner can avail himself of the protection afforded by the statute. See American Homes Co. v. Krantz, 131 N. J. Eq. 213, 24 A. 2d 518 (Ch. 1942).

Accordingly, the plaintiff’s lien for materials furnished extends only to the materials furnished prior to the filing of the principal contract. The amount of said lien is $927.42.


author: William J. Brennan, Jr., J. A. D.

text:
    FRANKLIN A. SEWARD AND HELEN SEWARD, HIS WIFE, PLAINTIFFS-APPELLANTS, v. NATURAL GAS COMPANY OF NEW JERSEY, A CORPORATION OF NEW JERSEY, DEFENDANT-RESPONDENT.
    Superior Court of New Jersey-Appellate Division
    Argued December 11, 1950 —
    Decided December 28, 1950.

      Before Judges McGeehan, Jayne and Wm. J. Brennan, Jr.

      Mr. William J. O’Hagen argued the cause for appellants (Messrs. Stout & O’Hagen, attorneys).

      Mr. Samuel A. Lamer argued the cause for respondent (Mr. Wilbur A. Stevens, attorney).
   The opinion of the court was delivered by

William J. Brennan, Jr., J. A. D.

Plaintiffs appeal from a judgment in favor of defendant entered in the Law Division, Monmouth County, upon a jury verdict of no cause for action.

The suit sought damages for Mrs. Seward, and consequentially for Dr. Seward, for personal injuries suffered by Mrs. Seward in a gas explosion in the cellar of their Shark Biver Hills summer home.

Dr. Seward on May 6, 1939, entered into a written contract with defendant for the installation of the latter’s “system” for the supply and service of liquefied petroleum gas (propane gas) and at the same time purchased from defendant a kitchen gas range and a side-arm heater. The “system” consisted of a cylinder or gas storage-tank equipped with a regulator or reducing valve and placed on a concrete platform on the outside and at the back of the house and of copper tubing running from the storage tank to the range and heater.

The contract required Dr. Seward to purchase his requirements of liquefied petroleum gas exclusively from defendant for a period of three years, and this he did to the date of the explosion. Defendant reserved title to the gas storage tank and related equipment and the right to remove the same “in whole or in part at any time without previous notice.”

Defendant’s employees installed the copper tubing which connected the gas storage tank with the range in the kitchen and the side-arm heater in the cellar. The heater and the hot water tank were located in the far corner of the cellar. The connection to the heater was made by running the copper tubing from the gas storage tank through the house foundation wall along the underflooring of the house and thence down to the heater.

The complaint charges negligence in very general terms. The pretrial order is not printed in the appendix (see Buie 3:16, as amended, and Buie 1:3-1), and we do not know whether any limitation or clarification of the issues was set forth therein. The allegations of the complaint are that the explosion resulted from the escape of propane gas caused by the negligence of defendant (1) in furnishing improper equipment and appliances, (2) in making an improper installation, and (3) in furnishing an unsafe and hazardous gas.

The explosion occurred on July 15, 1941. Mrs. Seward went to the cellar and lighted the heater after manually turning on the petcock on the heater to start the flow of gas from the storage tank. She returned upstairs and waited about 15 minutes for the water to heat. She turned on the water and it ran hot for 15 or 20 minutes and then suddenly ran cold. She went down to the cellar and discovered there was no flame in the burner and that the gas was flowing. She stopped the gas flow by turning off the petcock. This was 30 or 40 minutes after she had first lighted the burner. There was no evidence why the flame went out nor for' how long it had been out and the gas flowing. Mrs. Seward returned upstairs and two hours later went back to the cellar.

She descended the stairway to the bottom step. She detected no odor of any kind. She said she did not know the gas was propane gas and “I had never been told that that gas was heavier than air or anything like that and much slower in dissipating.” She lighted a match while standing on the bottom step “thinking if it flickered I wouldn’t attempt to light the heater.” The lighted match did not flicker. She then went over to the heater, stooped down before the door of the heater, lighted another match, “There was an immediate explosion.” The force of the explosion was great. Mrs. Seward was seriously burned; the whole house shifted at least a half-inch on the foundation; a bedroom floor was blown upwards, doors on the first floor were blown off and there was much miscellaneous damage.

The defendant’s witnesses testified the gas supplied by it contained an odorant called ethyl mercaptan so that its presence upon escape could be readily detected. The trial court submitted to the jury the question whether this odorant was in fact present in the light of Mrs. Seward’s testimony that she had detected no odor. The court, however, refused plaintiffs’ request to charge based on defendant’s alleged negligence in furnishing improper equipment and in making an improper installation. Plaintiffs contend the rulings in these respects and related rulings on offers of evidence were erroneous.

Impuopeb. Equipment and Appliances.

Defendant admitted in an answer to an interrogatory propounded by plaintiffs that the regulator or reducing valve attached to the storage tank outside the house was made of “metal and rubber.” Plaintiffs’ counsel attempted to elicit testimony of an expert chemist that propane gas has an effect on such materials which would cause a malfunction of a valve made of them. The trial court sustained defendant’s objections io these questions. This was not error. The evidence was there are many kinds of regulator or reducing valves, and there was no proof which type was installed on this equipment or of the condition of the particular valve before or at the time of the explosion. The storage tank and the valve had been removed by unidentified persons on the day of:, or the day after, the explosion.

The trial court, moreover, did not err in refusing plaintiffs’ request to charge based on the doctrine of res ipsa loquitur. Plaintiffs’ contention was the proofs showed title to and control of the valve were reserved by defendant, that the valve somehow became defective, shutting off the flow of gas to the burner and causing the flame to go out, that it somehow became sufficiently adjusted to cause the gas flow to resume and escape through the unlighted burner. While there were proofs of defendant’s ownership and control of the regulator valve, it is pure speculation, in the absence of proofs of its type or condition, that the valve was not functioning properly and that this alleged defect was “in all probability the direct cause” of the explosion. Cf. Menth v. Breeze Corporation, Inc., 4 N. J. 428 (1950), at pp. 436, 437; Kramer v. R. M. Hollingshead Corporation, 5 N. J. 386 (1950).

The trial court also sustained defendant’s objections to questions asked plaintiffs’ expert chemist designed to elicit from the witness testimony that the gas line to the burner should have been equipped with an automatic shut-off to stop the flow of gas from the tank to the burner when the flame went out. The court ruled the proofs did not show the witness was qualified to testify whether or not there was a standard or practice followed in 1939 and 1941 to equip the lines with automatic shut-offs. The expert had a wide experience and knowledge as a chemist and a long familiarity with propane gas. He had no experience, however, in the installation of propane gas equipment for residential use. We are satisfied the trial court propeHy exercised its discretion in the circumstances. Cowdrick v. Pennsylvania R. R. Co., 132 N. J. L. 131, 141 (E. & A. 1944).

The defendant’s proofs showed there was no automatic shut-off in the line. There was, therefore, no prejudicial error in sustaining objections to questions asked the expert chemist whether he found one in the line when he examined it and the heater shortly before the trial.

Improper Installation.

Plaintiffs’ first and second requests to charge had for their purpose submitting to the jury the question whether under the proofs defendant had exercised the proper degree of care in installing its “system” in the manner it did to connect with the side-arm heater in the cellar. We think the proofs fully supported these requests and that it was error to refuse to charge them.

The cellar is of peculiar construction. The house rests on a foundation 2y2 feet high from grade with side dimensions approximately 28 feet,, by 30 feet. The bare ground is the area beneath the house except that directly under the house center is a concrete-lined “pit” 4 feet deep and about 10% feet square. The “pit” is the cellar with walls only 4 feet high but with a clearance from its floor to the house under-beams of 6% feet, the 4 feet depth of the “pit” plus the 2% feet clearance above the “pit” top at ground level to the house underbeams. The space beneath the house thus takes the shape of a hollow block 28 feet by 30 feet and 2% feet deep centered above the smaller “pit” 10% feet square and 4 feet deep. Entrance to the “pit” is by a stairway down from the first floor. The only openings in the foundation walls are two windows, one in the east wall and the other in the south wall, so placed that, according to the testimony, the cross ventilation between them did not pass over the “pit.”

There was proof this peculiar construction created a condition in which the propane gas, because it is heavier than air, would upon escape sink to the bottom of the pit and remain there some time out of reach of air circulation to dissipate it. Plaintiffs’ expert testified:

“Q. How would it be dissipated? A. In this particular installation principally by diffusion.
“Q. By diffusion? A. Bight.
“Q. And by diffusion you mean various air currents that come down and pick it up and waft it around before it goes? A. No, sir. That is convection.
“Q. Will you give me your definition then of diffusion that you have in mind? A. Diffusion is a state in which two dissimilar fluids in contact, by means of their molecular activity, permeate each other. The process is slow.
* * * * ils * *
“A. Well, if a lighter fluid be resting upon a heavier fluid; namely, if air be resting upon propane gas, there will be a gradual working upward of the particles of propane and a gradual working downwards of the particles, the molecules of air, until during a period possibly of a day there might be a uniform mixture. How long is difficult to estimate. I would say at least a day, unless there be a current of air which would accelerate that mixing and passing off, but there is a gradual working of one fluid into another even though a lighter one be resting upon a heavier one; they will still mingle in time.”
“A. There is no sensible ventilation to dissipate it in a pit regardless of the proximity of windows.
“Q. What is that for? Why is that? A. Because the gas is 60 per cent heavier than air, falls down to the bottom of the pit, and is not subject to flowing out through the windows six feet higher.
“The Court: Suppose there are drafts through the house having windows on one side and windows on the other. Would that dissipate the propane in this cellar?
“The Witness: The line of draft in this particular building, sir, did not come within five or six feet of the pit. If you were to connect those two windows to a straight line, that straight line would miss this pit by five or six feet, and hence the air currents would not even flow over the top of the pit, let alone dig and dissipate the gas out of the pit.”

The employees of the defendant who installed the “system” admitted that at the time he made the connection he was aware of the nature of construction of the cellar and that the heater was “quite a ways removed from the windows,” that he knew the gas was heavier than air, that he did not apply or install a vent or connection to a chimney, although the heater had a flue-hole for that purpose, that there was no automatic device installed in the line to shut off the flow of gas from the tank to the burner if the burner light went out and that the only method of turning off the gas was by manual operation of the petcock on the side of the heater.

Propane gas takes a gaseous form at normal temperatures and is kept in liquid form at such temperatures by application of pressure. In its pure form it is colorless, and odorless. An odor is supplied by the introduction of a mercaptan, usually ethyl. One of the properties of the gas, already mentioned and of significant importance in the circumstances of this case, is that it is “about a little over one and a half times as heavy as air” so that, according to plaintiffs’ expert chemist, “it will sink” “if the gas comes into the presence of air into a room, both being at the same temperature.”

Defendant’s vice-president admitted that combination of this gas with air in certain proportions produces an explosive mixture. The results of the explosion in this case are evidence of its destructive power. Other courts commenting upon this gas on proofs supporting their observations have said,- — “Propane gas is a dangerous substance,” March v. Carbide & Carbon Chemicals Corporation, 265 App. Div. 1064, 39 N. Y. S. 2d 493 (App. Div. 1943), “may cause an explosion more powerful than dynamite,” Grinnell v. Carbide & Carbon Chemicals Corporation, 282 Mich. 509, 276 N. W. 535 (Sup. Ct. Mich. 1937).

The vice-president also admitted familiarity with a standard appearing in an instruction of the National Board of Eire Underwriters in a booklet dated in 1948 reading, “When in the gaseous state these gases present a hazard comparable to any flammable natural or manufactured gas except that being heavier than air ventilation requires added precaution;” he disclaimed knowledge, however, whether this instruction was in effect in 1941.

Defendant was bound to exercise a reasonable degree of care commensurate with the dangerous and explosive nature of its commodity. Thornton, Law of Oil and Gas (4th ed. 1925), vol. 1, p. 1392. Care and diligence should always vary according to the exigency which requires vigilance and attention, conforming in amount and degree to the particular circumstance under which they are to be exercised, but the care must be equal to the occasion on which it is to be used, and is always to be judged of according to the subject matter, the force and danger of the material under the defendant’s charge in the circumstances of the case. Beck v. Monmouth Lumber Co., 137 N. J. L. 268 (E. & A. 1947). Gas “is certainly, in some circumstances and under certain conditions, an extraordinarily dangerous element,” Anderson v. Atlantic City Gas Co., 7 N. J. Misc. 297 (Sup. Ct. 1929); “and the rule of ordinary care with respect to its transmission is adjusted, in view of its known dangers and probable entailment, by a standard of care proportionate to the probable dangers.” Ibid., p. 298.

The circumstances and conditions of this case in view of the known tendency of this gas upon escaping to sink and the apparent danger in this “pit” that such escaping gas would not be readily dissipated called upon defendant to exercise that degree of care “which comprehends a circumspection, a foresight, a prevision, which has due and proper regard to reasonably probable contingencies,” Adams v. Atlantic City Electric Co., 120 N. J. L. 357, 363 (E. & A. 1938); Beck v. Monmouth Lumber Co., supra; Kress v. City of Newark, 9 N. J. Super. 70 (App. Div. 1950).

Ordinary experience teaches that the flame in a gas burner will go out, often for causes difficult or impossible to establish. This was a reasonably probable contingency which defendant should reasonably be expected to have anticipated. The proof was the defendant’s gas, being heavier than air and thus having a tendency to sink, presented a definite danger in this peculiarly constructed cellar with the greater difficulty of a slow dissipation because accomplished, according to the expert testimony, by diffusion rather than by convection of air currents, since the windows were so placed that “the air current would not even flow over the top of the pit let alone dig and dissipate the gas out of the pit.” Whether under these circumstances defendant took proper precautions in making the side-arm heater connection and fulfilled its duty of care is a question about which reasonable men might well differ, and it therefore became an issue to be decided by the j^y-

The case of Beck v. Monmouth Lumber Co., supra, presented a closely analogous situation. There a power company erected a pole on the property of a lumber company and strung uninsulated wires carrying high voltage to furnish current for the lumber oompany’s electric motors. The lumber company used a mobile crane in its business with a 65-foot boom for raising lumber and machinery and unloading freight cars. The electric wires were strung 29 to 33 feet above the ground. Plaintiff’s decedent was killed while repairing the crane when it came into contact with the electric wires. There was a jury verdict against the power company and the lumber company and both defendants appealed. The power company relied principally on its argument that there was no proof of negligence on its part because the uncpntradicted proofs established the wires were installed with standard equipment and maintained in accordance with standard practices. The Court of Errors and Appeals rejected this argument, holding (at p. 273), “As a general rule the adoption and operation of a method which accords with that in general use by well regulated companies and approved by experience is due performance of the duty and the care owed, but the care which must be exercised over the construction and maintenance of a highly destructive agency requires more than the use of mere mechanical skill and approved mechanical appliances; it also includes circumspection and foresight with regard to reasonably probable contingencies. * * * The crane, mobile in its nature, was used on the property for various purposes. Its presence and use were known to the power company representative supervising and making the electrical installation. Its dangerous proximity to wires they knew to be uninsulated was apparent. One of the defendant’s expert witnesses admitted the existence of uninsulated, highly charged wires created a hazard and were installed in this instance with no consideration to the use of the crane.” “Admittedly no warning of danger was given.” “Notwithstanding the employment of standard equipment and standard practices, the jury could reasonably find this defendant had failed to exercise the degree of care required under the circumstances.”

So here the special property of this gas to have a tendency to sink because heavier than air was known or should have been known to defendant; “admittedly no warning of danger was given.” The peculiar construction of the “pit” and the location of the side-arm burner with relation to the windows in the foundation of the house were known to the installation mechanic employed by the defendant. “It was incumbent upon defendant to take into account the vital factor of the room’s air circulation” when introducing this highly dangerous gas. Jaeger v. Elizabethtown Consolidated Gas Co., 124 N. J. L. 420 (Sup. Ct. 1940). A jury could reasonably find this defendant had failed to exercise the degree of care required under the circumstances.

In Jones v. Blossman, 209 La. 530, 25 So. 2d 85 (Sup. Ct. La. 1946), plaintiff purchased a butane water heater which was set up and installed by defendant. Sometime thereafter plaintiff remodeled his house and constructed therein a small closet, and defendant installed the heater in that closet. Defendant instructed plaintiff to leave the door of the closet open. Adjacent to that closet was a clothes closet. On the occasion in question plaintiff went to the clothes closet in order to open the door of which it was necessary to close the door to the closet containing the water heater, and this she did. She remained in the clothes closet for about ten minutes and immediately thereafter closed the door to the clothes closet and opened the door to the closet containing the water heater. As soon as she did this an explosion occurred in the closet containing the water heater. Plaintiff alleged as negligence the installation of the water heater in this small closet without any outlets or openings other than a -vent running from the heater to the outside of the house. Judgment for the plaintiff was affirmed, the court saying, “When the defendant installed this gas heater he was installing a dangerous instrumentality and he is, by law, charged with knowledge of the particular dangers characteristic to such an instrumentality and is particularly charged with the duties to use that degree of care which is commensurate with the danger.”

In Grinnell v. Carbide & Carbon Chemicals Corporation, supra, defendant through a sales agent installed a Pyrofax system which included two supply tanks of propane gas. The gas escaped from one of the tanks because the tank was laid on its side in the locker. The gas being heavier than air seeped through the holes in the bottom of the locker into the engine room of the boat and the explosion resulted. It was held the finding of negligence below was fully supported by the proofs.

In Cleveland Gas Co. v. Woolen, 30 Tenn. App. 282, 205 S. W. 2d 754 (Ct. of App. Tenn. E. Sec. 1947), the gas company supplied butane gas to 2,500 customers. The company had knowledge that plaintiff used a water heater not equipped with an automatic shut-off and that she was the only customer served by defendant who had a heater of that type. The flow of gas to all the customers was interrupted by some mechanical difficulty at the central production point. The flame in plaintiff’s burner went out. When .the mechanical difficulty was repaired and the flow of gas resumed it escaped through the unlighted burner, accumulated in plaintiffs basement and ultimately exploded. A judgment for plaintiff was affirmed.

The court said, “We think the evidence in this case, due to its peculiarities, which probably will never be duplicated, makes it a case of negligence so strong as to verge on a heedless indifference to consequences. Certainly, the defendant did not use that high degree of care commensurate with danger that may reasonably be expected to occur from the improper or negligent distribution of this most useful — and dangerous — servant of mankind.”

In Fry v. Sears, Roebuck & Co., 271 Mich. 469, 260 N. W. 906 (Sup. Mich. 1935), plaintiffs had a jury verdict against the seller of a hot water heater resulting from the explosion of the heater caused by freezing of wafer in an expansion tank placed by the seller in an attic. The negligence claimed was that the tank, which was installed almost three years before, should not have been placed in the attic where the water was more likely to freeze than in the room. The judgment was affirmed. The court said, “The obligation of defendant was to furnish a system which would not only keep running, but which would start safely under ordinary use. It was bound to anticipate that the fire would be out in warm weather, would be started when it got cold, and that people determine the time for a fire from the conditions about them. If, then, defendant put the tank in a place where the water was more likely to freeze than would be indicated by conditions surrounding plaintiff, knowing or having reason to anticipate danger therefrom, it would be guilty of negligence.”

See also Clay v. Butane Gas Corporation, 151 Neb. 876, 39 N. W. 2d 813 (Sup. Ct. Neb. 1949); Atlanta Gas Light Co. v. Johnson, 76 Ga. App. 413, 46 S. E. 2d 191 (Ct. App. Ga. 1948); Annotation, 138 A. L. R. 870.

We conclude it was for the jury to say whether defendant fulfilled its duty of care in the light of the particular circumstances. irrespective of the absence of proofs whether the connection of the heater accorded with standard practices generally. Beck v. Monmouth Lumber Co., supra.

The questions of contributory negligence and assumption of risk were on this record properly submitted to the jury for determination. Thornton, supra, p. 1470; Beck v. Monmouth Lumber Co., supra.

Reversed.


author: Eastwood, J. A. D.

text:
    STATE OF NEW JERSEY, PLAINTIFF-RESPONDENT, v. BENNY BALDINO, DEFENDANT-APPELLANT.
    Superior Court of New Jersey Appellate Division
    Argued December 4, 1950 —
    Decided January 2, 1951.

      Before Judges Jacobs, Eastwood and Bigelow.

      Mr. Wallace S. DePuy argued the cause for the plaintiff-respondent (Mr. Walter G. Winne, attorney).

      Mr. Albert S. Gross argued the cause for the defendant-appellant (Mr. Frank J. Cuccio, attorney; Mr. Nicholas. A. Carella, of counsel).
   The opinion of the court was delivered by

Eastwood, J. A. D.

The defendant, Benny Baldino, appeals from his conviction by the Bergen County Court, sitting without a jury, on an indictment charging him with maintaining in the Borough of Lodi a place “for the purpose of prostitution, in violation of Title 2, Chapter 158, Section 2a, of the Revised Statutes.”

The facts are not disputed and a detailed recital thereof is unnecessary. Suffice it to say, that, in response to a complaint, two investigators of the State Alcoholic Beverage Control Commission visited defendant’s premises and while there, were approached by Baldino, who offered two girls to them for the purpose of illicit sexual intercourse for a stated price. One of the girls was escorted from the premises by an investigator to his automobile parked nearby, given the money she demanded, and was arrested when her intention became unmistakably clear. The defendant, a holder of a retail consumption liquor license, upon being taken into custody, freely admitted that he had arranged for prostitutes to frequent his tavern and introduced them to male customers for the purpose of promoting illicit sexual relations; that he did not share in the fees charged by the prostitutes in their illicit indulgences. It is undisputed that the acts of prostitution were actually consummated at places other than on defendant’s premises.

The statute (R. S. 2 :158-2a) under which Baldino was indicted and convicted provides :

“Any person who shall:
“a. Keep, set up, maintain, or operate any place, structure, building, vehicle or conveyance for the purpose of prostitution, lewdness or assignation;
¡i: * * * ❖
“Shall be guilty of a misdemeanor.”

The question posed for our determination is solely a legal one. The defendant contends that while the arrangements for the commission of the illegal acts were made on his premises, no act of prostitution occurred there and, therefore, the proofs do not constitute the maintaining of a place for the purpose of prostitution within the spirit and meaning of the pertinent provision of the statute.

The State contends that the proofs support the conviction of the defendant as charged in the indictment; that the words of the statute “for the purpose of prostitution” encompass the maintaining of a place with the intent to promote the evil of prostitution and that the proof of that intent is sufficient to render one guilty without a showing that the parties committed the proscribed act of prostitution on the premises.

Under the common law it was not a crime for men and women to engage in fornication, prostitution or other immoral practices in private, and when engaged in such a manner as to create a public scandal and shock public morals, the practices became public nuisances. The resort to a public place for such immoral practices constituted the place a disorderly house. State v. Schlosser, 85 N. J. L. 165 (Sup. Ct. 1914) ; affirmed, 86 N. J. L. 374 (E. & A. 1914); Kilpatrick v. Edge, 85 N. J. L. 7 (Sup. Ct. 1913); State v. Williams, 30 N. J. L. 102 (Sup. Ct. 1862).

It has been repeatedly held that the management of those vocations which minister to and feed upon human weaknesses, appetites and passions is a proper exercise of the police power of the State, and following the crusade against white slavery, a generation ago, the Legislature enacted a statute designed to suppress the evil of plying the trade of a prostitute and punish those who engage in or lend assistance to the promotion of this iniquitous conduct.

Prostitution in its general sense is the letting of one’s self to indiscriminate sexual intercourse for gain. The language of the statute (R. S. 2:158-1 et seq.) was made sufficiently broad to eliminate the necessity of gain as an element of the crime. Lewdness at common law meant open and public indecency, but as used in the statutes imposing a punishment for open and gross lewdness and lascivious behavior, it is used in a broader sense and means the irregular indulgence of lust, whether public or private, and a place resorted to for the purpose of prostitution or lewdness is known as a house of assignation. 27 C. J. S., § 4, p. 306.

The purport of the statute in question, as we construe it, is to stamp out the evil of unlawful indulgences in lust, and lewd and lascivious conduct. Subsection (a) of the statute specifies a character of unlawful conduct which, in our opinion, creates a criminal offense that embodies three elements, viz.: keeping of the structure or place, the libidinous conduct therein in one of the designated forms, and, in order to render a person guilty of keeping such an establishment, the knowledge of the existence of such improper use. State v. Mausert, 85 N. J. L. 498 (Sup. Ct. 1914).

Webster’s New International Dictionary (2d ed.) defines “purpose” as follows:

“That which one sets before himself as an object to be attained; the end or aim to be kept in view in any plan, measure, exertion, or operation; design; intention.”

The New English Dictionary defines “purpose” as “that which one sets before oneself as a thing to be done or attained; the object which one has in view; the object for which anything is done or made, or for which it exists; the result or effect intended or sought; end; aim.” Sawter v. Shoenthal, 83 N. J. L. 499, 500 (E. & A. 1912). Applying that definition to the charge against the defendant, the allegation would be that defendant maintained the premises with the object of having the alleged infamous conduct performed therein.

The defendant admits maintenance of the structure or place and knowledge of the character of conduct resorted to therein as well as his complicity in the promotion of the same. The infamous conduct alleged in the indictment is “prostitution.” However, the record is clear that no act of this kind was committed on the premises. As a matter of fact, all testimony concerning indulgence in illicit sexual relations between the prostitutes provided by the defendant and the patrons of his bar indicates that the acts were performed outside the premises.

In that posture of the case, we find that defendant’s conviction for maintaining a place “for the purpose of prostitution” is not supported by the proofs and that the judgment must be reversed. The statute in question denounces the commission of certain crimes and it must, therefore, be accorded a strict construction. State v. Brenner, 132 N. J. L. 607 (E. & A. 1945).

It will be noted that subdivision “a” of the statute in question denounces three separate and distinct crimes, viz.: maintaining a place for the purpose of (1) prostitution; (2) lewdness; or (3) assignation. We have discussed herein-above the crimes of prostitution and lewdness. The definition accorded the word “assignation” in Webster’s New International Dictionary (2d ed.) is, “an appointment of time and place for meeting or interview; — used chiefly of love interviews and now commonly in a bad sense.” It is not within the scope of reasonable likelihood that, though incidental, one of the objects with which defendant operated his establishment was the facilitating of appointments for indulgences in illicit sexual intercourse as is condemned by subsection “a” of R. S. 2:158-2 P However, the defendant was not indicted for maintaining a house of assignation. Furthermore, R. S. 2:158-2 provides that:

“Any person who shall:
* ***** * *
“d. Direct-, take, or transport, or offer or agree to take or transport, any person to any place, structure, or building, or to any other person with knowledge or reasonable cause to know that the purpose of such directing, taking, or transporting is prostitution, lewdness, or assignation ; or
“e. Procure or solicit or offer to procure or solicit for the purpose of prostitution, lewdness, or assignation; or”
*******
“g. Engage in prostitution, or assignation or knowingly aid or abet prostitution, lewdness, or assignation—
“Shall be guilty of a misdemeanor.”

As stated, it is clear that the Legislature intended to completely ban, in every aspect, the crimes denounced in the statute in question. Accordingly, it would appear from the record that the defendant’s unlawful activities would be more properly classified under the foregoing subdivisions (d), (e) and (g). In view of the fact that the statute of limitations has not run as to defendant’s offense or offenses, the State is not precluded from further indictment and prosecution of defendant, and thereby avoid thwarting the statutory pre hibition on such infamous conduct.

The judgment is reversed.