author: Pitney, Chancellor.

text:
    In the matter of the application of Carrie Smisson for sale of lands limited over.
    [Decided January 30th, 1912.]
    1. In a will postponing disposition of testator's principal estate until after the death of his wife and his three children, there were clauses giving to the wife one-third of the income during her life, and distributing the remainder of the income to the children in specified shares. Then followed these clauses: “Item. Upon the death of my wife I do order that the one-third of the income hereby bequeathed to her shall he distributed among- my surviving three children.” “Upon the death of any of my three children, I do order the portion bequeathed to him or her to be distributed among his or her heirs.”—Held, (a) that the second of the quoted clauses, as well as the first, refers to income only, and was not intended to make disposition of any portion of the principal estate; (5) that the word “heirs” is used as a substitutionary term, and when, taken in connection with the contest shows a testamentary intent that each installment of income when it accrues (from and after the death of any of the three children and until the death of the last survivor) shall be distributed among those who at the time it accrues are appropriately to be described as “his or her heirs;” (o) that where a deceased child of the testator leaves issue living at the time the income accrues, such issue are “his or her heirs” within the meaning of the clause; (d) that the word “heirs,” as here used, included a grandchild of a deceased child of the testator.
    2. The rule against perpetuities that obtains in this state is the same as that adopted by the English courts; and under it any limitation that does not postpone the vesting of the estate longer than the duration of a life, or any number of lives, in being at the death of the testator (and twenty-one years thereafter), is valid.
    3. Where the vesting of the fee is not postponed beyond the duration of specified lives in being at the death of the testator, any limitations of the life estates that may be made to take effect in the meantime are not within the'rule against perpetuities, because they cannot by any possibility postpone a vesting of the fee beyond a period permitted by the rule.
    On petition and. amended petition of Carrie Smisson, individually, and as executrix of Lillian Smisson Sehaab, deceased, and Georgina Westendorf, fox payment to them of interest on funds in court.

      Miss Mary PhilbrooTc, for the petitioners.

      Messrs. Weller x& Lichtenstein, for the guardian ad litem of the respondent John Jacob Sehaab, an infant.
   Pitney, Chancellor.

The present controversy relates to the disposition of the income accruing upon thirteen-ninetieths of a certain fund that remains in court, being the proceeds of a sale of lands made under an order of this court pursuant to the “Act to authorize the sale of land limited over,” &c., enacted in 1857, and the supplement of 1868. Rev. 1877 pp. 1052, 1054 pl. 41, 51; Gen. Stat. pp. 2992, 2994 pl. 46, 50; N. J. Comp. Stat. pp. 4688, 4691 pl. 42, 50.

The lands in question were formerly owned by John J. Smisson, who died in the year 1877, leaving a widow, Jane, and three children, viz., Sarah, James and John, and leaving a will which contained the following provisions respecting the lands in question and other lands of which he died seized:

‘'Item. It is my will and I do order that my wife, Jane Smisson, shall be permitted to occupy the premises whereon I now -reside, free of rent as long as she shall desire so to do, and while she continues to occupy the said property, X do order my executor to pay to her out of my estate the sum of $400 per annum, to be used by her for keeping the place in order.
“Item. I do give and bequeath unto my said wife the income -of one-third of my estate during the term of her natural life, and the remainder of the income of my estate I do order to be distributed as follows:
“One-fifth thereof shall be paid to my son John Smisson. Two-fifths thereof‘ shall be paid to my son James Smisson, and two-fifths thereof shall be paid to my daughter Sarah Jane Turner, and in addition thereto my said son James and daughter Sarah Jane shall be permitted to occupy the premises where they now reside upon Washington street, in Hobo-ken, free of rent so long as they desire. It being expressly understood, however, that none of my children are to draw any income fro'm my estate until the mortgage upon my property in Bloomfield street, Hoboken, has been paid and satisfied by my executor; which shall be done out of two-thirds of income of my estate.
“Item. Upon the death of my wife I do order that the one-third of the income hereby bequeathed to her shall be distributed among my surviving three children.
“Upon the death of any of my three children 1 do order the portion bequeathed herein to him or her to be distributed among his or her heirs.
“Item. Upon the death of my wife and three children, above named, I do order my executor to sell and dispose of all of my real and personal estate at private or public sale, as he shall deem most advisable, and distribute the proceeds of such sale among the children of my said three children, equally share and share alike.”

Jane Smisson, the widow, died in the year 1886. Sarah Jane Turner, the daughter, died in 1881, without issue.. John Smisson died in 1897, leaving three children, viz., Carrie Smisson, Lillian Smisson Sehaab, wife of Jacob Schaab, and Georgina Smisson Westendorf, wife of Charles Westendorf. James Smisson, the remaining child of John J., is still living.-

In 1904 a petition for the sale of the lands under the “Act to authorize the sale of land limited over to infants, or in contingency,” &e. (above cited), was presented by Carrie Smisson, setting up the facts just mentioned, and averring James Smisson to be entitled to the income of seventeen-thirtieths of said lands during his life, and the petitioner, Carrie Smisson, and her sisters, Lillian Smisson Schaab and Georgina Smisson Westendorf, to be entitled together to thirteen-thirtieths of the income during the life of J ames, and entitled to the whole of the lands at the death of J ames without issue. ■

The master to whom the matter was referred made a report (filed June 9th, 1905)’ showing that the lands in question were “held in the manner and under the limitations mentioned in and by said last will and testament, and that upon the death of the said James Smisson, surviving child of the said John J. Smisson, deceased, the children of John Smisson, deceased, and the children of the said James Smisson, if any there be, will be entitled to the proceeds arising from the sale of said lands as set forth in and by said will.” He reported that it was unadvisable to sell the Bloomfield street or the Washington street property mentioned in the will, but reported in favor of the sale of another tract mentioned in the petition, known as the Paterson street property in West Hoboken.

In due course the then chancellor made an order for the sale of this latter property, and it was sold, and the proceeds were paid into court. It is this fund of which the income is now in question.

It should be added that it appears that the mortgage on the Bloomfield street property has been long since satisfied, as required by the will.

Some time after the proceeds of sale were paid into court, application was made to me for an order that the interest moneys thereon be paid to Carrie Smisson, Lillian Schaab and Georgina Westendorf, and that the principal sum or any share thereof which had become vested should be paid to them. I thereupon made an order of reference to a special master (dated May 6th, 1909) confining the inquiry, however, to the question of the disposition of the income; Chancellor Magie having held, on a former occasion, that no part of the principal had become vested. A report was made by the special master (filed February 16th, 1910) to the effect that the parties were not presently entitled to receive any portion of the principal, and that the whole of the interest arising from the proceeds of sale should be paid to the said James Smisson and the said Carrie, Georgina and Lillian in the proportions of seventeen-thirtieths to James Smisson, and thirteen-ninetieths to each of the others. Upon the coming in of this report, and under date March 10th, 1910, an order was made which provided for the payment of the interest moneys already accrued, and that should thereafter accrue during the lifetime of James Smisson, in the proportions just mentioned.

This order contained the following additional clauses:

“That in the case of the death of said Carrie Smisson, Lillian Schaab or Georgina Westendorf, during the lifetime of said James Smisson, the share of the interest to which either of them is entitled shall be paid to the heirs, devisees, legatees or next of kin of said deceased as this court shall direct; and upon the death of said James Smisson, the full amount of the said proceeds of sale shall be paid to the said Carrie Smisson, Lillian Schaab and Georgina Westendorf, equally share and share alike, or in case of the death of either of them as this court shall then direct.”

So much of this order as provided for the disposition of the principal upon the death of James Smisson was inadvertently included therein, and upon my attention being called to it, I made an order striking out this clause.

Subsequently, and on September 3d, 1910, Lillian Smisson Schaab died, leaving her surviving her husband, Jacob Schaab, and her only child, John Jacob Schaab, an infant of tender years, and leaving a will by which all her property was given and devised to this child, and of which her sister Carrie Smisson was appointed executrix.

After the death of Mrs. Schaab, a petition and amended petition were filed by Carrie Smisson, individually, and as executrix of Mrs. Schaab’s will, and by Georgina Westendorf, praying for a determination of the rights of the several parties in that share of the income which would have been payable to Lillian Smisson Schaab had she survived. It is this amended petition that raises the question now to be decided.

In this application J ames Smisson is not interested, for it does not aifect his right to seventeen-thirtieths of the income during his lifetime. The only parties interested in the controversy (other than the petitioners) are Jacob Schaab and his child, John J acob Schaab. Eor the father appearance has been entered, but no, answer was filed nor argument made in his behalf. For the infant a guardian ad litem has been appointed, and counsel has submitted argument in support of his claims.

The question turns upon the proper construction of the provisions of the will of John J. Smisson above quoted, and especially the following clauses:

“Item. Upon the death of my wife I do order that the one-third of the income hereby bequeathed to her shall be distributed among my surviving three children.
“Upon the death of any of my three children I do order the portion bequeathed to him or her to be distributed among his or her heirs.”

In my opinion, the second of these clauses (as well as the first) refers to the income only, and was not intended to make disposition of any portion of the principal estate in the contingency mentioned. The disposition of the principal was postponed by the next item until after the death of the wife and all three children of the testator, in which event the executor was ordered to sell and dispose of all the estate of the testator “and distribute the proceeds of such sale among the children of my said three children equally, share and share alike.” Beading the will as a whole, it seems to me to clearly manifest the intent of the testator to keep his entire principal estate intact so long as his wife or any of his children should be living. In the meantime the income thereof was disposed of, and the income only.

The ultimate vesting of the beneficial estate is thus postponed pending the lives of four persons in being at the death of the testator ; and of these four J ames Smisson is now the sole survivor.

By whom, under the terms of this peculiar will, the legal fee of the lands is held during the period of the lives in question, is a question of some difficulty. It has, as I think, no bearing upon the present question, unless Jacob Schaab should claim (but he does not claim) the right to succeed as tenant by the curtesy to the interest of his deceased wife.

I am told that in an ejectment, suit brought some years ago by the then living children of the testator against the administrator cum testamento annexo of his will, it was held by Mr. Justice Dixon at the Hudson circuit that the children took the fee. But I have no report of the case, which, as 1 am told, was decided upon an agreed statement of facts, and without any opinion in writing. Except for this decision I should be inclined to think, reading the whole of the will together, that it imposed a trust by implication upon the executors which would carry with it the foe of the land as necessary to the execution of the trust. See Lindley v. O’Reilly, 50 N. J. Law (21 Vr.) 636. There are, of course, many cases where a gift of the income of an estate, in .the absence of indications of a contrary intent, amounts by implication to a detdse of the fee. Diament v. Lore, 31 N. J. Law (2 Vr.) 220. But I do not think that rule can fairly be applied to the complicated and shifting provisions respecting income in the present case.

Moreover, in any view the estate of Lillian Smisson Schaab was in the nature of a life estate only, and her husband cannot succeed her as tenant by the curtesy.

For other present purposes the question—who took the legal estate in the lands during the lifetime of James Smisson—is of no consequence, for the sale made under the order of this court divested the legal estate and conveyed it to the purchaser, leaving the proceeds of sale to stand in lieu of the lands and subject to the terms of the will: and the legal title to those proceeds is vested in, this court by section 5 of the statute. Gen. Stat. p. 2994.

It makes no difference whether under the will of the testator the land itself was limited over, or whether the fee was vested and only the proceeds thereof limited over. In the former case, the authority of the court to sell the land was derived from section 1 of the act of 1857 (Gen. Stat. p. 2992); in the latter case it was derived from the supplement of 1868. P. L. 1868 p. 792; Gen. Stat. p. 2995 pl. 56.

Me. at present, have to deal only with the beneficial or equitable interest in the income upon the proceeds of sale, and its disposition must depend upon the intent of the testator as expressed in his will, rather than upon technical questions respecting the legal estate in the land.

Nor need we spend time upon the question whether the principal money is now to be treated in equity as real estate or as personal property. If we were dealing with 'a succession on intestacy tli at question would become important. In such cases, it is held that a conversion of land into money by a sale under the act for the sale of lands limited over does not in equity convert the proceeds into personal property. Dowe’s Case, 68 N. J. Eq. (2 Robb.) 11.

The clause of the will that is now before me for construction was intended to apply to income derived from both real and personal property, and I have-to deal only with the question of the intent of the testator respecting the disposition of that income as manifested by the language that he used.

Recurring, then, to the clause in question, and remembering that it applies to income only pending the life of James Smisson, the language is:

“Upon the death oE any oE my three children X do order the portion bequeathed herein to him or her to be distributed among his or her heirs.”

The nature of the subject-matter prevents us from placing a strictly literal interpretation upon the first three words—“upon the death.” If the thing to be distributed were the principal of the estate, or any single sum that was to be divided once for all, the three words quoted rvould be referable to a single point of time, and the scheme of distribution would necessarily be ascertained with reference to that time.

But what is to be distributed is income to accrue in installments at intervals during a period of uncertain duration; and it seems to me we must understand the words “upon the death of any of my three children” as meaning “from -and after the death,” &c. The same meaning is to be attributed to the same words where they occur in the clause immediate^ preceding— “upon the death of my wife,” &c.

Next we come to the clause—“to be distributed among his or her heirs.” The word “heirs” is used as a substitutionary term, and, when taken in connection with the context, it seems to me to show that each recurring installment oí income when it accrues (from and after the death of any of the three children of the testator) shall be distributed among those who at the time it accrues are appropriately to bo described as “his or her heirs.” And, of course, where the deceased child of the testator leaves issue living at the time the income accrues, such issue are “his or her heirs” within the meaning of the clause.

Thus, upon the death of John Smisson (one of the three children of the testator), and from and after his death, and until the death of James Smisson, the portion of income theretofore bequeathed to J olm is to be distributed among his “heirs.” I think this means those persons who would have been the “heirs” of John if he had died at the time of the receipt of the income that is to be distributed.

If John Smisson had outlived his daughter, Mrs. Schaab, his “heirs” would have been his two daughters, Carrie Smisson and Georgina Westendorf, and his grandson, John Jacob Schaab. And, as I think, the testator did not intend that the distribution of the income of his estate, from time to time as it accrued, pending the life of the last survivor of his -wife and three children, should be materially affected by the mere order of events, or should depend upon the precise time when the death of any of the three children of the testator should occur., I see no sign of a purpose to discriminate among the descendants of his children.

The contention of counsel for Carrie Smisson and Georgina Westendorf is that the word “heirs,” in the clause under consideration, points to the three daughters of John Smisson as a class, and that the survivors are entitled to the whole of the thirteen-thirtieths of the income until the time of the final distribution of the estate. But it is and must be conceded that the word “heirs” in a will has been held in eases without number to mean “issue,” or “children,” or “next of kin,” or other relatives of the first beneficiary, according to the intention of the testator to be gathered from the character of the estate and the entire context of the will. I think the word “heirs,” in this instance, means the same as “issue,” and includes a grandchild.

This testator evidently intended to restrain, and, as I think, did effectively restrain, the final disposition of his principal estate until the death of the last survivor of his wife and three children; and during such restraint he intended, I think, to dispose of the income among his surviving children and the issue of his deceased children, without any discrimination based upon the accidental order of events.

It is argued that this interpretation renders the bequest void for remoteness. Whether a bequest is void for remoteness depends upon whether it violates the rule against perpetuities. The rule adopted by the English courts is that any limitation that does not postpone the vesting of the estate longer than the duration of a life, or any number of lives, in being at the death of the testator (and twenty-one years thereafter), is valid. Cadell v. Palmer, 1 Cl. & Fin. 372, 441; 6 Eng. Reprint 956, 971; 21 Eng. Rul. Cas. 100, and American notes (at p. 154).

This is the rule that obtains in the American states, except so far as it may have been changed by statute. 22 Am. & Eng. Encycl. L. (2d ed.) 704, 708; 30 Cyc. 1467, 1470. In this state we have no statute that affects the present question.

Since under the Smisson will the vesting of the fee was not postponed beyond the duration of four lives in being at the death of the testator, whatever limitations of the life estates may be made in th.e meanwhile are not within the rule against perpetuities, because they cannot by any possibility postpone the vesting of the fee beyond a period permitted by the rule. King v. Cotton, 2 Wms. P. 674, 677; Low v. Burron, 3 Wms. P. 262.

In short, since the clause I have under consideration applies to income only, the extension of the word “heirs” in that clause does not enlarge the number of lives upon whose duration the vesting of the estate depends; for it has to do only with the description of persons who are to enjoy the income pending the life upon which the vesting of the estate depends.

My opinion, therefore, is that so much of the income on the fund in court as was payable to Lillian Smisson Schaab by the terms of the order of March 2d, 1910, should be paid to her only child, John Jacob Schaab, so far as it has accrued from and after September 3d, 1910 (the date of Mrs. Schaab’s death). So far as it accrued during her lifetime, it of course should go to her executrix.


source: Caselaw Access Project

author: Emery, Y. 0.

license: Public Domain

text:
    Charles C. Wallace v. Charles E. Coward et al.
    [Submitted October 25th, 1911.
    Decided November 17th, 1911.]
    1. Where it appears on the face of a bill that complainant’s right of action is barred by limitations, a demurrer for that reason will lie.
    2. On general demurrer to a bill to foreclose a mortgage, the presumption of payment arising from lapse of twenty years, will be sustained, in the absence of allegations explaining or excusing the delay.
    3. The statute of limitations applies to a suit in equity to foreclose a mortgage, under the rule that the right to foreclose ceases when the legal right of entry is barred.
    4. Payment of interest on a mortgage by the mortgagor or his gram.ee within twenty years prior to the filing of a bill to foreclose will toll the statute of limitations.
    5. A bond, secured by mortgage, provided for payment to mortgagee of a specified sum one year from April 1st, 1861, and the legal interest thereon, which interest was to be paid to E. C. during the term of her natural life, in lieu of dower, but from her death the interest to be paid to mortgagee, his heirs and assigns. A bill to foreclose, filed in 1911, contained no allegation of payment of interest at any time to E. C. during her lifetime or to complainant since her death, nor was the date of her death, alleged.—Held, that, since the payment of the principal to the mortgagee was not postponed until the death of E. C., but the mortgagee was entitled to sue therefor on April 1st, 1862, the bill on its face, in the absence of any allegation showing payment, either of principal or interest, within twenty years, or any explanation or excuse for delay in bringing suit, showed that the suit was barred by limitations.
    On demurrer to amended bill.

      Mr. Aaron V. Dawes, for the-cleimirrants.

      Messrs. Davis & Davis, for the complainant.
   Emery, Y. 0.

This is a bill, to foreclose a mortgage securing a bond dated March 30th, 1801, given by Forman Coward, obligor, to Charles E. Wallace, the complainant, in the penal sum of $1,066, payable-to the obligee, his executors, administrators or assigns, with the following condition underwritten, viz.:

“That if the said Forman Coward should pay unto the said Charles E. Wallace, his certain attorney, executor, administrator or assigns, the just sum of $538 in one year from the 1st day of April, a. d. 1861, and-the legal interest thereon, which interest is to be paid to Elizabeth Coward, widow of Samuel Coward, deceased, for and during the term of her natural life, in lieu of dower, but at and from her death said interest to be paid to the said Charles E. Wallace, his heirs and assigns, then this, bond shall be void.”

The amended bill was filed June 16th, 1911, and seeks to recover interest and principal alleged to be due thereon to theobligee. The only additional allegation of the bill showing theobligee’s right to recover interest is the following:

“That the said Fdizabeth Coward mentioned in the deed mortgage fromForman Coward to 5rour orator is dead, and your orator thereupon became entitled to the payment of the interest reserved in said mortgage, and that there are large sums of money due to your orator as interest on said mortgage, which said sum, as well as the principal sum thereby secured, are due and unpaid.”

It appears by the bill that after the mortgage, the mortgaged premises were conveyed by the mortgagors (Forman Coward and' his wife), and the grantees as well as the holders of subsequent mortgages on the property are defendants to the bill, as well as the original mortgagors, against whom decree for payment of deficiency is prayed.

The defendants file a joint demurrer setting up the statute of' limitations, and that none of the supposed causes of action accrued within twenty years before filing the bill. Where it appears on the face of the bill that complainant’s right of action is barred by the statute of limitations, a demurrer for that reason will lie. Bird’s Administrator v. Inslee’s Executors (Chancellor Zabriskie, 1873), 23 N. J. Eq. (8 C. E. Gr.) 363; Myers v. Fridenberg (Chancellor Magie, 1905), 70 N. J. Eq. (4 Robb.) 3. And, on general demurrer, the presumption of payment of a bond and mortgage arising from lapse of time (twenty years) will be sustained in the absence of allegations explaining or excusing the delay. Olden v. Hubbard (Chancellor Runyon, 1881), 34 N. J. Eq. (7 Stew.) 85, and cases examined by me, cited in Blue v. Everitt (1897), 55 N. J. Eq. (10 Dick.) 329. On the appeal in this case, the decree was affirmed on other grounds, and the grounds upon which the decision was rested were not considered—11 Dick. 455 (1897)—but they were considered and approved in the subsequent case. Colton v. Depew (Court of Errors and Appeals, 1900), 60 N. J. Eq. (15 Dick.) 454, 462. These decisions of the court of errors and appeals'— Blue x. Everitt and Colton x. Depew—settle the rule that the statute of limitations applies to a foreclosure suit in equity, and that the right to foreclosure ceases when the legal right of entry is barred, and also that payment of the interest on the mortgage by the mortgagor or his grantee within twenty years of the filing of the bill will prevent the running of the statute. Colton v. Depew, supra (at p. 464).

Under these settled rules, the question in this case, on this joint demurrer of the obligor and grantees, is, whether complainant's bill shows that the right of recovery in himself for either principal or interest is barred by the statute of limitations or by the presumption of payment. The demurrer being general and to the whole bill, cannot be sustained if either principal or interest be recoverable. The bill was filed in 1911, thirty-nine years after the bond for the payment of the principal became due, and there is no allegation of payment of interest either on the bond or mortgage, at any time, to Elizabeth Coward during her lifetime, or to complainant since her death. The date of the death of Elizabeth Coward is not given, and for the purpose of the demurrer, may be taken to have occurred just previous to filing the bill, upon the principle that the pleading is to be continued contra proferenclem. This construction limits so far as possible the amount of complainant’s right of recovery. Complainant contends that inasmuch as his right to the interest did not accrue until Elizabeth Coward’s death, the statute did not run against his right to recover interest until after her death, which must, on the demurrer, be taken to have been within twenty years. This contention might be well founded, if by the bond the payment of the principal to complainant had been postponed to the death of Elizabeth Coward, or if by the proper construction of the bond it should be considered that complainant had a right to recover interest, for his own benefit as a claim separate from his right to recover the principal and without regard to the principal being due. But, as 1 read this bond, it was conditioned for the payment of a certain sum absolutely to complainant one year from April 1st, 1861, followed by a further provision as to the payment of the “interest thereon”—that is, the interest on the said sum remaining unpaid, and so long as it was unpaid. As to the “interest thereon,” it was (so long as the principal was not paid to complainant) to be paid to Elizabeth Coward during her life, and from her death the “interest thereon”—that is, the interest on the principal sum unpaid, was to be paid to complainant. If the sum of $533 had been paid to complainant on April 1st, 1862, according to the tenor of the bond, “interest thereon” would no longer be payable by the obligor either to Elizabeth Coward or to complainant after her death. And after the death of Elizabeth Coward, complainant’s right to recover interest is not a right independent of his right to recover the principal, but is an incident of his right to recover the principal sum due. Complainant at any time after April 1st, 1862, might have brought a foreclosure to recover the principal due to himself and the interest due on the bond either to Elizabeth Coward or himself, but in the absence of any allegations showing payments within twenty years, either of principal or interest on account of the mortgage, and in the absence also of any explanation or excuse for complainant’s delay in bringing on the. suit, the right of foreclosure is barred, as well because of the statute of limitations as upon the presumption of payment.

I will advise an order allowing the demurrer, but complainant may apply to amend the bill.


author: Emert, Y. C.

text:
    Richard C. Jenkinson, surviving executor of George B. Jenkinson, deceased, v. New York Finance Company et al.
    [Decided December 30th, 1911.]
    1. No decision should be made in an administration suit as to the share which certain persons not parties to the suit would take under a will.
    2. Assignments of equitable interests in a fund held by a trustee being subject to the equities of the trustee arising before notice of the assignment, a loan wrongfully made to a legatee by a testamentary trustee from the trust funds, without notice of a prior assignment by the legatee of his interest in the estate, could be retained by the trustee from the amount payable to the legatee or his assignees, irrespective of whether the amount advanced was a loan to the legatee or an advancement from the share due him from the estate.
    3. The loan of the funds of the estate by a testamentary trustee to a legatee upon his personal note when his interest in the estate was contingent was at the trustee’s personal risk, being a wrongful use of the trust funds.
    4. An assignee from a cestui que trust who is a debtor to the trust estate must discharge the debt in order to claim a beneficial interest in the fund assigned.
    5. An executor and testamentary trustee who wrongfully loaned or advanced money to a legatee who had only a contingent future interest in the trust estate on his personal note will not be permitted to estop himself from afterwards retaining such amount from the amount due the legatee by any statements to the legatee as to the number of assignments then held by the trustee of the legatee’s interest, without mentioning the amount advanced by the trustee, in reliance upon which a creditor took an assignment of a part of the legatee’s interest; any remedy which the creditor had being against the trustee personally.
    6. Notice by a prior assignee of an interest in a trust estate to the trustee is essential as against a subsequent assignee for value in good faith and without notice; the prior assignee’s failure to give notice being negligence, which permits the assignor, through his apparent, ownership of the trust fund, to-defraud subsequent purchasers.
    7. Legal interests in property are assignable by rules fixed either at common or statute law.

      8. In absence of statute, the maxim, “The first in order of time is the strongest in Jaw,” applies to the successive assignments of equitable interests in land as well as to the transfer of legal interests.
    0. The equitable doctrine of notice is not applicable to the conveyance of equitable interests in lands.
    10. Legacies are purely equitable interests in their origin.
    11. A trustee who makes payments of a beneficiary’s interest from the trust fund either to the beneficiary or a subsequent assignee without notice of a prior assignment is protected as against a prior assignee.
    12. In cases where a subsequent assignee merely stands in the shoes of his assignor, subject to his equities, as in ease of an assignee under the insolvent laws, &e„ a prior assignment is effective, without notice, against a claim of a subsequent assignee.
    13. An assignment of a debt is valid by a delivery of the evidence of the debt without any writing, and any security would follow the debt in equity.
    Heat'd on bill, answers, replication and proofs.

      Messrs. Coult & Smith, for the complainant.

      Messrs. Collins <& Corbin, for the New York Finance Company.

      Messrs. Guild ■&. Marlin, for the defendant L. F. Robertson & Sons.

      Mr. Edward Q. Keasbey, for the defendant Banes.

      Messrs. McCarter & English, for the defendant Bernheim.
   Emert, Y. C.

This suit is an administration suit, the hill being filed by Richard C. Jenkinson, the surviving executor and trustee of George B. Jenkinson, deceased, for an accounting- and settlement in this court. The questions now to be determined relate to the interest of George B. Jenkinson, Jr., one of the children of the testator, in the residue of the estate, and the settlement of the priorities of defendants who claim as assignees of his share under assignments either of specified portions of the share or by way of charge or mortgage upon the share. A preliminary question arises as to the amount of-the share subject to the assignments by i eason of the claim of the executor to deduct from the share a sum of $5,000 received by the legatee from the executor, with interest thereon. The defendants to the bill include George B. Jenkinson, Jr., against whom a decree pro confesso has been taken, and tour of the defendants claiming as assignees under George B., viz., the New York Finance Company, who had two successive assignments each for $15,000 of the fund; the executors of Gustav Bernheim; L. F. Eobertson & Sons, a corporation. and Bobert 0. Banes, to whom the New York Finance Company assigned its rights under the first of its assignments.

The Fidelity Trust Company, an assignee claiming under an assignment from the legatee, admitted to be prior to the executor's claim as well as prior to all of the other assignees above named, except L. F. Eobertson & Sons, is also a defendant to the bill, and by an order in the cause, made by consent of all the other assignees, except L. F. Eobertson & Sons, payment of their claim was made by the executor.

As to the preliminary question, the amount of George B.’s share, for which complainant as executor is accountable to them, it is contended that a sum of $5,000, which George B., Jr., received from the executor out of the funds of the estate, should not be deducted before paying the portions of the estate under the assignments. The facts bearing upon this issue, which is one partly of fact and partly of law, are as follows:

The testator made several specific devises and bequests, none of which are now material to be considered, except the third, eleventh, twelfth and thirteenth clauses. In the third clause of the will he directed his executors to invest or set apart from any investments he might hold at his death, a sum sufficient to pay to his wife $7,500 yearly during her life, and in lieu of dower. On her death these investments are, by the twelfth clause, to form part of the residuary estate. The widow, who is still living, accepted the provisions of the will, and has received the yearly payments as directed. The executors have not, however, set aside investments to pay the annuity, but by the consent of the residuary legatees, who were also the legatees of the excess over $7,500 of the income on the investment directed to be set apart, have paid the annuity from the general income of the estate. Under the thirteenth clause—the residuary clause—George B. will be entitled to receive one-eighth of this fund., on the widow’s death, if he be then living, but his share being contingent on his outliving the widow, no portion of this fund (or of so much as should be set aside therefor) is now applicable to any of the assignments, and under the residuary clause, a question may arise whether his interest therein is not contingent on his surviving the widow. The issue of George, to whom the share George would have taken if living at the time the share was to be paid, is given in case of George’s death, are not parties to the suit, and no decision on this point should be made in their absence.

The three executors were authorized by the eleventh clause to sell all real estate, the proceeds of sale to form part of the residuary estate.

The residuary clause of the will is as follows:

“Thirteenth. I give, devise and bequeath all the rest and residue of my estate, including both real and personal (subject to the power of sale hereinbefore given), to my said son Bichard G. Jenkinson, and my son-in-law, James T. Bali, and the survivor of them, in trust, nevertheless, and to and upon the uses and trusts following, that is to say, to invest and to keep invested my personal estate, hereby giving' them full power to charge investments and reinvest from time to time in their discretion, and to take charge of and let my real estate until sold, and until such time to keep the same sufficiently insured and to make such necessary repairs thereto as they may think requisite, and to pay all taxes and charges against the same out of the income of my residuary estate, and then, first, to pay to each of my six children—Eliza J. Holmes, Charlotte A. Smyth, Fanny J. Taylor, George B. Jenkinson, Junior, Eleanor Jenkinson and Harry L. Jenkinson—the interest of thirty thousand dollars, at the rate of six per centum per annum in half yearly payments for the period of ten years after my decease, or until the decease of my said wife, if that shall occur within that time; and at the end of that time, or upon the decease of my said wife, if that shall first occur, to pay to each of my said six children the principal sum of thirty thousand dollars. If any of them shall have died leaving lawful issue, then to pay to such issue the share the one or ones so dying would have received if living; and if any of them shall so die without leaving issue, leaving a husband or wife surviving, then to pay to such husband or wife the sum of ten thousand dollars, and the balance of twenty thousand dollars of any such share to pay over to my surviving children and the issue of them who may have died, in equal shares, such issue to take the parent’s share! In case any of my said six children shall die without leaving issue, or husband or wife then living, the share of such one to he paid over as directed by tbe next subdivision of this clause; and second, to pay over the balance of my said residuary estate at that time, in equal shares, to all my children then living, and the issue, if any, of such of them as may have then died, such issue to take the share the parent would have taken if then living.”

The testator died on January 30th, 1896, leaving a widow and eight children, all of whom are living and are parties to the suit. The widow was one of the three executors named by the testator, the complainant and James T. Ball, a son-in-law, being the other two, and tire persons named as trustees in the residuary clause. The widow renounced the appointment of executrix, and James T. Ball died in January, 1898. The complainant, as surviving executor, and under the power of sale given by the will, has sold real estate as well before as after the expiration of the ten years fixed for the time of payment of the principal sums of $30,000 to the six of the eight children, to whom tire balance of the residuary estate is to be paid, under the second subdivision of the thirteenth clause.

At the filing of the bill (January 28th, 1908) the executor had in hand as George’s share the principal sum of the legacy $30,000, and the additional amount of $1,971.49, from which the executor claims a deduction or payment of $5,000 received by the legatee from the funds of the estate between J airuary 23d and April 30th, 1904, besides interest. Up to January 30th, 1906, when the legacy of $30,000 was payable under the residuary clause, and up to the filing of the bill, the executor had received $112,950 as proceeds of sale of real estate, which under the will fell into the residue, and to one-eighth of which George is entitled. Since filing the bill the executor has received from proceeds of sales of real estate made up to June, 1911, the additional sum of about $171,877.50, to one-eighth of which George would be entitled. On October 14th, 1909, an order was made by consent in writing of all parties in the cause except L. F. Robertson & Sons, which, after reciting that the complainant had in his hands funds available to be distributed out of the share of George B. in excess of $60,000, and that the total claim of L. F. Robertson & Sons with interest would not exceed $7,000, directed the executor (after reserving from the funds in his hands distributable to the share of George B., the sum of $7,000 to answer the claim of L. F. Robertson. & Sons) to pay to the Fidelity Trust Company, claiming under an assignment dated December 28th, 1903, the sum of $40,000, with interest at 5 per cent, from December 28th, 1903 (the date of its trust deed or mortgage), less interest paid. The defendants, L. F. Robertson & Sons, under a previous assignment, executed on May 14th, 1901, claimed priority over the Fidelity Trust Company, whose trust deed or mortgage was ad-' mitted to be prior to all of the other assignments as well as to' the claim of complainant to deduct the amount subsequently advanced to George with notice. After this payment to the Fidelity Trust Company, and after reserving a principal fund for the widow’s annuity of $7,500, the funds in the hands of the executor applicable to the share of George in the residuary fund will not at this time exceed the sum of $30,000, without allowing for the retention of $5,000 and interest from January, 1904, to pay the legatee’s note to the estate. The claims of the defendants under their assignments (not including interest), stated accoi’ding to the date of the execution of their assignments, aro: L. F. Robertson & Sons, May 14th, 1901, $4,000; the New York Finance Compaq, first assignment, assigned to defendant Banes, $15,000, December 1st, 1904; New York Finance Compaq, second assignment, March 14th, 1905, $15,000; Bernheim’s executors, $6,270.74, with interest from February 25th, 1903, assignment dated October 31st, 1905, to secure the judgment recovered February 25th, 1903, and made expressly subject to the two assignments to the New York Finance Company. Notice to the executor of the two assignments io the finance company was given on or about their respective date, by letter of the legatee formally notifying the executor of the sale, and authorizing him to pay over the amounts assigned out of his interest in the estate, when the same should become due and payable. Copies of these assignments were delivered to the executor on January 20th, 1906. Notice of the Bernheim assignment was given to the trustee on or about January 12th, 1906, by a letter of that date from Bernheim’s attorneys, and on or about January 19th a copy was sent to the trustee. On or about January 26th, 1906, the executor, through his attorneys, received from L. E. Eobertson & Sons the first notice of their assignment, with a copy enclosed in their letter of that date.

The right of the complainant to retain the claim of the estate is disputed by the New York Finance Company and Banes, and the priority of the L: F. Eobertson & Sons claim, first in order of time, but last in order of notice, is disputed by all the subsequent assignees, because of this failure to give notice and because their respective assignments were taken in good faith and for value, and without notice of the prior assignments. As between the assignees subsequent in date to Eobertson & Sons, there is no dispute in relation to their respective priorities, which are determined both by the order of time as (veil as notice.

First. As to the right of the executor to first deduct from George’s share the amount of $5,000 received from the executor and for which he holds George’s note dated January 22d, 1904, payable on demand to the order of the estate, with interest at five per cent. As collateral security for the payment of this note the executor received an assignment of seventy-five shares of the capital stock of the corporation T. B. Peddie & Company, which has been declared insolvent since the filing of the bill. Nothing will be realized on the stock. It is contended on behalf of Banes that the transaction was an advancement to George on account of his share of the estate, but upon the evidence I conclude, that it, was not an advancement, but was a loan by the executor.

It is also contended that if the transaction was a lo.an, it was a loan io George upon the personal security of his note, with collateral, and that there is therefore no right of retention from George’s share in the funds of the estate as against his subsequent assignees. As the loan was made without notice of the previous assignment to L. F. Eobertson & Sons, and was in fact,, made previous to all of the other assignments, the general rule, that assignments of equitable interests in a fund held by the trustee are subject to the equities of the trustee arising before notice of the assignment, would, in the absence of special equities, be of itself decisive as to the right of the executor to retain from the amount payable to the legatee the amount due from the legatee to the trust estate. This general equity of the trustee to retain for payment would, I think, exist whether the loan was an advance on account of the legatee’s share, or whether it was an independent loan of money of the estate to the legatee personally and for which it 'would have a set-off bad George himself brought suit for the legacy. Considered as a loan, this transaction was a loan of moneys of the estate upon improper security, and as appears by the evidence, it was arranged between George B. and the executor, with the consent of the other children. It was probably made with the expectation that it would be repaid to the estate before any legacy became payable to George, as similar loans of larger amount had previously been paid. But inasmuch as George’s right to the $30,000 was expressly contingent on his living until the time for payment, there can be no question that the loan of the estate funds was a breach of trust, and at the personal risk of the executor, who protected himself by securing the consent, of the other children. Under these circumstances, neither George nor any person claiming under him, by assignment or otherwise, has any right to claim payment of his share under the will, except upon the terms of making good or accounting for the amount improperly taken. There can be no question, I think, that if George himself were claiming the legacy, the executor would be entitled to- deduct the moneys received, and so far as the mere right to deduct by reason of the advance goes, there is no reason for making a distinction between George and those claiming under him. Their rights can be no greater than his.

An assignee from a cestui que trust who is a debtor to the estate cannot claim the beneficial interest without discharging the debt. 2 Lew. Trusts *60-6. The right of the estate to be protected against breaches of trust by the trustee is enforced even to the extent of holding the assignment by a legatee who is also the trustee, to be subject to the liability of the trustee to make good all breaches of trust, as well after as before the assignment. Morris v. Livil (1842), 1 Y. & C. Eng. Ch. 380; Knapman v. Wreford (1880, C. A.), 18 Ch. Div. 300. As the debt due from George to the estate was payable on demand, the equity of the estate for payment arose immediately and continued until the debt is paid.

The finance company and Banes, its. assignee, claim, however, that special equities exist between them and the executor, which entitle them to insist that as against them, and because of the circumstances under which the assignments to them were made, the executor is estopped from claiming the right to retain, as against either the first assignment now held by Banes, or the second assignment. The facts relied on to sustain this claim of estoppel are these: George B. applied to the finance company to raise money by sale of a portion of his share in the estate. The attorney for the finance company desired a statement from the trustee, as to assignments of which he had notice, and upon George, the legatee, stating that such inquiries, if made by him (the attorney for-the finance company), would not procure the desired information, the attorney suggested that the legatee himself procure-the information and turn it over to the finance company. George B. accordingly procured from the trustee the following letter to himself, which he afterwards delivered to the finance company:

“Dec. 1, 1904.
“ill;-. George B. Jenkinson, 2nd, South Orange, N. J.:
“Dear Sir—If it will be of any assistance to you and help you pay off the Bernheim claim and settle with the Newark Banking- Company, I am very willing to state that to the best of my knowledge and belief the two assignments you made to the Fidelity Trust Company and the National Banking Company respectively are the only ones of which I have received a notice in writing, and beyond that the only other papers I recall affecting your interest in the estate, are those in connection with the suit of the Hamilton National Bank, by which I am restrained from paying you the annuity.
“Yours truly,
“It. C. Jenkinson, Ear.”

What statements were made by George B. to the trustee, upon the faith of which the letter was obtained, does not appear, but, as bearing on the question of estoppel, it will be noticed that in this letter there was no reference to the amount of any assignment proposed to be made, and it would appear from this letter that the executor supposed the money proposed to be procured by the legatee by the assistance of his letter was to pay the-Bernheirn claim, $6,250 and interest, and that of the Newark Banking Companjq the amount of whose claim does not appear, but who already had an assignment. The finance company, on the receipt of this letter from George, made their first purchase, paying $10,000 for a $15,000 portion of the estate, without further inquiry of the trustee or information to him about their proposed purchase. And in the following March (1905.), without any further inquiry or information, it made the second purchase of $15,000, paying therefor $10,000. The assignments to the finance company formally transferred to the extent of $30,000, George’s entire interests, legal as well as equitable, and either vested or contingent, under his father’s will, including the legacy o£s$30,000. It is now claimed that by reason of the executor’s omission to state in this letter that the estate held a claim arising out of the loan to George now in question, the executor and the estate he represents are now estopped from setting up the claim for retention against either the first, or second assignment.

Considering this claim purely on the basis of the principles of estoppel, my view would be that the letter, the only .act of the executor on which the estoppel is based, should not be held to estop him from setting up the claim for payment of the amount then due from him.

Before giving the letter any such effect, it should be shown, I think, that the attention of the executor was directed to the matter of the amount of tire assignment to be made. This might have called to his attention the question of the effect of it on the claim of his estate, which seems to have escaped his attention and at the moment was not recalled “as a paper affecting George’s interest in the estate.” The Bernheinr claim, for which the money was to be raised, was under $7,000, and there was no apparent reason for referring to the estate’s claim for $5,000, even if it was in the executor’s mind. But as the letter itself shows, the claim on the note, whether from carelessness or want of recollection, was not at the time considered as a paper or notice of the kind about which information was desired.

As to the second assignment made in March, there can certainly be no basis for holding the executor to be estopped. Had an inquiry been made of him before this advance, he might have recalled and mentioned the claim. To hold him bound by estoppel for all future transactions between George and those with whom he dealt, on the basis of this letter and without further inquiry from the trustee, would stretch the principles of estoppel beyond all reason. But, without placing the decision upon this point, my view in reference to the whole question of estoppel is, that the executor, who was acting merely as trustee, has no authority either in George’s favor or that of his assignee, to estop himself as trustee from afterwards asserting the rights of a trustee in the administration of the estate, and that any waiver of the right to deduct from George’s share the amount improperly advanced from the estate funds would of itself operate to assist in a breach of trust. Such breach of trust could not have been properly effected, even by a direct agreement between the trustee and George or his assignee. Nor would this court ratify or carry into effect any such agreement. Much less could it be effected by the application of the doctrine of estoppel. Equitable doctrines are established for the purpose of enforcing equities, not to destroy them. If there was any misrepresentation in the letter of the complainant, or any failure, through negligence, carelessness or otherwise, to assert the claim of the estate to deduct the $5,000 loan from George’s share, for which misrepresentation or failure the writer of the letter was responsible to the finance company, the writer was responsible only personally. The estate in the executor’s hands was not and could not be bound by way of estoppel, not to assert its rights against George, and it cannot be made to suffer for the executor’s letter to George. Other persons than George and the executor are interested in the retention and have never waived their right to it, and as now representing all persons interested in the estate, the executor is entitled to deduct the amount due on the loan to George before making payments under any of the assignments.

Second. I come now to the principal question, that relating to the priorities as between the assignees of the fund.

In its general aspect, the question involved is that of priority between successive assignees of a legacy or equitable interest, when the assignee prior in point of time lias omitted to give notice to the trustee of the assignment by the cestui que trust or beneficiary, and the beneficiary has made subsequent assignments of the same interest to assignees in good faith and for value, without notice of the prior assignment, and the subsequent assignees have themselves successively given notice to the trustee of their respective assignments. This general question o.f the necessity of notice to the trustee in order to preserve priority against subsequent assignees in good faith, is one of great practical importance, and of wide scope, inasmuch as it involves the settlement by the court of equity of the formalities or rules (if any) necessary to be observed in order to retain the full benefit of the acquisition of a species or class of property which the court itself has created as being equitable interests, and has also invested with the character of assignability. Legal estates and interests in chattels or lands are assignable by rules fixed either by common law or statute, and one of the principal objects of the recording acts is to regulate the priorities between successive grantees or mortgagees. In the absence of statute, the general rule applicable to such priorities is the fundamental maxim relating to the transfer of the title to property—"Qui prior est tempore potior esi jure.” As to equitable interests and estates in lands (strictly so-called), there is no question, I think, that so far as they are not within the recording or other statutes, equity follows the same general rule. The equitable doctrine of notice is not applicable to the conveyance of equitable interests or estates in lands. Jones v. Jones (Vice-Chancellor Shadwell), 8 Sim. 633; Hopkins v. Hemsworth (Justice Kekewich, 1898), 2 Ch. 347, 351; 2 Pom. Eq. Jur. (3d ed.) § 683, note (2), § 713. Where the assignments are of legacies, which are in their origin purely equitable interests (King v. Berry (Chancellor Vroom, 1834), 3 N. J. Eq. (2 Gr. Ch.) 44; Kennedy v. Parke (Green, Ordinary, 1864), 17 N. J. Eq. (2 C. E. Gr.) 415), or of funds in the hands of trustees, or like purely equitable interests, much discussion has arisen in reference to the effect of failure of notice by the prior assignee, and the rule to be established in such case as well as to the equitable principles upon which it should rest. These discussions have occurred in a great variety of cases—sometimes where the precise question of priorities now involved has not been involved, and as decisions, the opinions are obiter dicta. Such cases are those where the question arose between the prior assignee and the trustee who had made payments from the fund either to the assignor or a subsequent assignee, without notice of the prior assignment. In this case there is, I think, no difference of opinion that the trustee paying without notice is protected. In others, the subsequent assignee was a claimant whose only right was that of the assignor and who stood exactly in the shoes of the assignor, subject to his equities, e. g., a judgment or attachment creditor, or assignee under insolvent laws or other involuntary assignments for the benefit of creditors.

As to these, also, while there is some difference of opinion, the clear weight of authority is, I think, that the prior assignment, so far as the assignor and such adverse claimants under him are concerned, is complete and effective without notice, and the claimant by the subsequent assignment, whose estate is necessarily, by the circumstances of its creation, only that of assignor, is also subject to the prior assignment. This is the rule settled in our courts. Board of Education v. Duparquet (Vice-Chancellor Pitney, 1892), 50 N. J. Eq. (5 Dick.) 234, 242; approved in Miller v. Stockton (Court of Errors and Appeals, 1905), 64 N. J. Law (35 Vr.) 614, 622; Cogan v. Conover Manufacturing Co. (Court of Errors and Appeals, 1905), 69 N. J. Eq. (3 Robb.) 809.

The real difference of opinion in the courts arises when the subsequent assignees claim to stand upon a footing which gives rise to the application of what is claimed to be a special and peculiar equitable principle, as against the prior assignee who has failed to give notice.

The special equity now alleged to exist against the prior assignee is one claimed to arise by reason of his conduct in failing to give notice, and in the consideration of the question those cases in which some further special circumstances existed giving rise to equities in favor of the subsequent assignee, other than the mere failure to give notice, may be treated as not decisions on the question in hand.

The division of opinion among courts and judges as to whether any special equity arises from this mere failure to give notice, is very great. One set of courts follows what is sometimes called the English rule, that the special equity does exist and that notice of the assignment to- the trustee is necessary in order to preserve priority. These include the United States supreme court—Iowa, Missouri and Pennsylvania. Courts 'in which the general rule that priority in time gives priority in right, seems to have been adopted, are, among others, those of Indiana, ’Kentucky, North Carolina, Massachusetts and New York. In several states both rules seem to have been applied at different periods, and it is only in the later decisions that the question has been finally settled in the respective jurisdictions. A collection and analysis of the English and American cases is given in 66 L. R. A. 760, &c:, in a note to the case Re Phillips (1903), 205 Pa. 515, in which it was held that as between successive assignments' of a fund in the hands of a third person, the one which, being acquired without notice of prior assignments, is first brought to the knowledge of the depositary is entitled to priority. Other collections of the cases are 2 Am. & Eng. Encycl. L. (2d ed.) 1077; 4 Cyc. 77, note 82, and 19 Yale Law Jour. 258, February, 1910, on “Notice of Assignments in Equity,” by E. Q. Keasbey.

• In this state of the authorities, I shall not examine any of the cases in detail, except the English cases, where the doctrine of notice originates, and those in our own courts. Counsel upon both sides rely upon decisions of our own courts as settling the question in favor of their respective contentions and an examination of these at some length will therefore be necessary.

In the leading English case, Dearle v. Hall (Plumer, M. R., 1827), 3 Russ. 1, where the doctrine of priority according to notice was first laid down, the grounds were stated, and one of these grounds (for two or three are given) is the ground upon which the rule has been finally rested in England and those courts which adopt the same rule. In this case, set out fully in 2 Pom. Eq. Jur. § 695, note 1, the beneficiary of a sum of money invested in the name of trustees assigned it for value to the complainant, who gave no notice of the assignment to the trustee. Subsequently the beneficiary assigned his interest in the fund to another purchaser, who purchased in good faith and inquired of the trustee, as to any prior encumbrance or sale before making the purchase. The second assignee gave notice of his assignment. The" bill was filed by complainant as prior assignee against the trustee and the second assignee, the trustee not having paid the beneficiary or either of the assignees. The case was twice argued, and the master of the rolls in the course of his opinion referred to several considerations as grounds or reasons for preferring the subsequent assignee with notice to the prior assignee who had neglected to give notice. One of these was that if the purchaser of an equitable interest desired to have his right under his purchase to attach upon the subject of the contract instead of being merely a contract personally binding the assignor, notice to the trustee must be given. Unless such notice be given, all was not done which was essential in the transfer of title to personal property, as under the law of England personal property passes by delivery of possession, and it is possession which determines the apparent ownership. If, having the right of possession, this right is not exercised and another is left in actual possession, he is enabled to obtain a false and delusive credit and to obtain money from innocent parties on the faith of ownership of that which belongs to'the first assignee. Choses in action and equitable interests in funds held by another do not admit of tangible actual possession on transfer of title, but the purchaser of such property must do everything toward acquiring possession which the subject-matter will admit of, and notice to the debtor or trustee is for many purposes tantamount to possession. The effect of failure to give notice is that the assignee “is guilty of the same degree and species of neglect as he who leaves a personal chattel to which he has acquired a title in the actual possession and under the control of another person.” In subsequent cases which followed the rule of Dearle v. Hall, it became essential to define with particularity the equitable grounds upon which the cases rested, and in Ward v. Duncombe, a house of lords case (1893), App. Cas. 369, all of the previous decisions were subjected to a vigorous and searching analysis by able counsel and by Lord Chancellor Herschell and Lord Macnaughten, Sir John Eigby, for the appellants, relying on some expressions in Dearle v. Hall, insisted that the real equitable basis of the- priority by notice Avas its effect as operating on the fund or .res in the hands of the trustee, and thus making a trustee for the assignee instead of the 'assignor. But Lord Herschell, after a careful examination of this opinion of the master of the rolls in Dearie v. Hall and of that of Lord Chancellor Lyndhurst on appeal, Avhich substantially concurred in all the reasons giAnn by the master of the rolls, says (at p. 378) :

“It is impossible, I think, to read these judgments without seeing that the leading consideration Avhich induced the court to lay down the rule that he aaIio gives notice has a better equitable right than a prior encumbrancer aaülo has given no notice, was this, that any other decision would facilitate fraud bt the cestui que trust and cause loss to those who might have used every precaution that was possible to ascertain, before parting with their money, that the title they were taking was a valid one, and who might have done everything they could to render that title secure. It is true that reference Avas made to the fact that the party giving notice had done all that AAras necessary to perfect his title, whilst he who had not given notice had not perfected it. But even here, I think the point upon which stress was laid was this, that the party giving notice had taken the property out of the apparent ownership and possession of the cestui que trust."

A case in the house of lords subsequent to Dearie v. Hall was Foster v. Cockerell (1835), 3 Cl. & F. 456, and this was referred to as haying finally settled the rule that as to choses in action and such interests in land as can only reach the beneficiary in the shape of money, priority of notice determines the title. And as to this case, it is said that Lord Lyndhurst, in delivering the opinion, ■ puts in the forefront as the ground of the decision in Dearle v. Hall, the apparent possession left in the cestui que trust Avhich enables him to commit a fraud. Lord Macnaughtcn in examining Dearle v. Hall, says that the master of the rolls on the first hearing relied principally on the ground of the fault of the first assignor in not giving notice, Avhich caused the mischief complained of, but that in the second hearing this consideration was fortified by others of more or less weight and by analogies more or less perfect and incomplete. These were that notice to the holder of an equitable fund was tantamount to possession, and that notice to the trustee charged him with responsibility to the giver of the notice, and that everything must be done toward giving possession that the subject admitted of. Lord Macnaughten was inclined to question the convenience of the rule in Dearle v. Hall and was not disposed to extend it, but in view of the fact that it had remained unaltered for sixty years, considered it beyond the power of the court to alter.

Ward v. Duncombe seems to have settled that the basis of the rule ,in Dearle v. Hall was the consideration of the effect of negligence or default in the prior assignee in not giving notice to the trustee. This neglect left the assignor as still the' apparent owner of the fund, which might be used by him to perpetuate a fraud on subsequent purchasers or encumbrancers which they would have no means of protecting themselves against, and the fraud if committed was thus due to neglect. This is the substantial ground, I think, now adopted by all the courts which adhere to the rule as its true equitable basis, the other considerations mentioned in Dearle v. Hall not being relied on to any extent, and the difficulties and complications resulting from the priority being put on the grounds of notice as necessar}'- for perfection of title, or of constituting the trustee a trustee for the assignor, probably make these grounds untenable. To the learned discussions in the cases I will add only one suggestion in favor of the English rule. The assignability of equitable interests is a purely equitable doctrine and seems to be based on the view that free transfer ought to be an essential right of the owner of equitable interests. The value of this transferable right will be substantially impaired in the hands of the transferrer unless the transferee can be protected by the exercise on his part of reasonable and ordinary diligence. If such transfer is to be subject to prior transfers of which neither the trustee nor subsequent transferee has notice, and of which the assignor is the only party to the transaction who has knowledge, the purchaser of the interest must for his protection against prior transfers depend wholly on the honesty of the assignor and cannot fortify his judgment in making the purchase by any inquiries. This condition necessarily affects unfavorably the general status of the value of equitable interests for purposes of transfer, and to thát extent, the right of transfer. The extent and necessity of assignments of such interest has become so great in the transactions of modern business, that purchasers in good faith and exercising due care must be protected, if the full or reasonable value of the interests is to be utilized.

Several decisions in this state are relied on as giving priority to successive assignments in order of time, but on examination I think it will be found that the status now in question was not directly or fairly involved. Kennedy, Exr. of Luse, v. Parke (1864), 17 N. J. Eq. (2 C. E. Gr.) 415, is usually cited as first establishing this rule. This was a petition in the orphans court, filed against the executor under the statute for the recovery of a legacy. The petition was filed by an assignee of the,'legacy, and the assignee and the executors were the sole parties to the actioñ brought under the statute of 1855. P. L. 342 § 17; Gen. Stat. 2393, 165. The defence set up by the executor was payment of the legacy to a subsequent assignee without notice,of the prior assignment. It was found by Ordinary Green (at p. 418) that the money was not in fact paid by the executor to the subsequent assignee until after notice. The learned ordinary in reference to the validity of the defence, if made out, said (at p. 417) :

“It was held by the chancellor in King v. Berry (Chancellor Vroom, 1834), 3 N. J. Eq. (2 Gr. Ch.) 54, that a claim to a legacy is essentially an equitable, not a legal claim, and that the assignment must pass the whole right of the assignor; that there does not remain in the assignor after the assignment of a legacy, a distinct subsisting right, capable of being assigned, but that the entire interest passes. Becognizing this principle, it is difficult to perceive how- any interest, legal or equitable, could have passed by the second assignment, or how the payment of the legacy to a party having neither a legal nor equitable title to it can constitute a .good defence to the action.”

This statement was rested on. the decision in King v. Berry, which was a bill by the assignee of a legacy against the executor to recover the legacy, and on final hearing the question was raised, whether to such a bill the legatee and assignor was a necessary party. No suggestion of any other assignment was made, and manifestly, decree against the executor in favor of the assignee and payment of the decree without notice of any other assignment, absolved the executor absolutely. The question of priorities was not involved, and tire learned ordinary in saying that under King v. Berry (which was a mere rule of practice as to parties) payment by an executor or trustee to a subsequent assignee, even if there had been no notice of the prior assignment “would not be a good defence to the action,” must be fairly taken to have meant not a good defence to the statutory action in the orphans court against the executor. For that it is a good defence in equity, is, I believe, held by all courts, and as showing that he did not intend to pass upon the difficult question of priorities between successive assignees as effected by notice, a question which was not discussed or touched in the decision, the learned ordinary further said (at p. 417) : “It would seem that if the executors have anj' defence upon this ground, it is purely an equitable defence and available only in a court of equity.” And as bearing upon his intention to decide this equitable question, it should be recalled, that in the earlier case (Superintendent of Public Schools v. Heath (1862), 15 N. J. Eq. (2 McCart.) 27), he had himself, as chancellor, in settling the claims of successive assignees of a chose in action, applied the doctrine of priority according to notice. He certainly did not intend to qualify in any vr&y this well considered case. The circumstances of the case and the scope and express limitations of the decision were such that I do not think it can be taken as considering, or as intending to decide, the question now in hand, or as controlling the present case. Kamena v. Hulbig (Chancellor Zabriskie, 1872), 23 N. J. Eq. (8 C. E. Gr.) 78, is the next case relied on. This was a foreclosure bill by an assignee of a bond and mortgage, in which the mortgagor set up and claimed credit for partial payment to a prior assignee of the mortgage. The subsequent assignment was made before this payment, but while the bond and mortgage were in the hands of the prior assignee, and the second assignment was recorded before the payment. The payment by the mortgagor after the assignment was a payment to the prior assignee of the amount for which he held the bond and mortgage as collateral security, and this amount was still due at the time of the second assignment. The chancellor said (at p. 80), “that the fact that the mortgagee did not hare 'them (the bond and mortgage) to deliver at the assignment to the complainant was notice that they were held by some one as owner or claimant.” He further said:

“.But no notice to him was required; he took them subject to all equities in this respect, that the title acquired by complainant was such as his assignor had at the time, that is, subject to the pledge, and that by the payment of the debt for which it Was pledged the mortgagor stood in the place of the pledgee, as her assignee in equity, and the complainant had no right in law or equity to any benefit f com the payment.”

If the ease be considered as one involving the priorities of successive assignees of a mortgage as'an equitable interest or lien in lands, then the doctrine of notice has no application. 2 Pom. Eq. Jur. §§ 685, 713. There was no discussion whatever of the question now involved nor any reference to authorities, nor was it necessary for the decision, which is plainly to be supported upon the ground of notice and bad faith in the second-assignee, if the case be treated as the assignment of a chose in action. The second mortgagee had constructive notice of the prior equitable assignment. Spencer v. Clarke (Vice-Chancellor Hall, 1878), 9 Ch. Div. 143; In re Werniger’s Policy (Mr. Justice Porter, 1910), 2 Ch. 291.

The other cases relied on are: Board of Education v. Duparcquet (Vice-Chancellor Pitney, 1892), 50 N. J. Eq. (5 Dick.) 234; Miller v. Stockton (Court of Errors and Appeals, 1900), 64 N. J. Law (35 Vr.) 614, 622; Cogan v. Conover Manufacturing Co. (Vice-Chancellor Garrison, 1905), 69 N. J. Eq. (3 Robb.) 358, 372; on appeal, Ibid. 811; United States Fidelity and Guarantee Co. v. Newark (Vice-Chancellor Howell, 1909), 76 N. J. Eq. (6 Buch.) 230.

All of these are cases where the question of priority arose between prior assignees who had failed to give notice and subsequent claimants under the debtor standing in the relation of creditors under statutory liens and by involuntary assignment of the debtor’s rights. As decisions upon the present question, these are plainly not controlling.

On the other hand, several decisions are relied on by counsel as affirming the rale of priority according to notice. These all relate to the successive assignments of choses in action, which, so far as requiring notice is concerned, are to be treated as standing upon the same footing as the assignments of equitable interests in money in the hands of trustees. Both are personal equitable rights of action, as distinguished from liens and other equitable interests in lands. 2 Pom. Eq. Jur. § 713. The leading case is Superintendent of Public Schools v. Health (1862), 15 N. J. Eq. (2 McCart.) 22. In this case, Chancellor Green settled the rights of claimants to an amount due on a building contract by the complainant, which was paid into court on an interpleader. The question principally discussed here was as to the preference claimed between certain classes of creditors—first, those claiming the fund under notices given under the Mechanics’ Lien law, and second, those claiming under orders for payment out of the fund given by the debtor, and as to the latter class, also third, the question was raised whether preference should be given to those creditors whose orders were given for debts incurred on the building, over those whose debts were contracted on other accounts. The decision was that there was no preference of either one of these three classes over the other, that all the claimants, in whatever class, were to be paid according to the priority of their respective orders or notices. The direction is (at p. 30), ‘'“'Each creditor is entitled to be paid in the order in which his notice or order was presented to the complainant.” As to the claimants under lien law notices, the statute expressly requires notice to the owner in order to complete the lien, but as to the priorities under orders, the general rules of equity control. The priority as between claimants under orders does not seem to have been taken to depend on any circumstances in the case except the respective dates of notice, and it may have been, as suggested by Vice-Chancellor Pitney in Board of Education v. Duparquet, supra (at p. 243), that the orders were all presented in the order of their respective dates. Although, therefore, this general direction has controlled the practice in subsequent similar cases, the ease cannot be considered as of itself controlling tire present case. In Shannon v. Hoboken (1883), 87 N. J. Eq. (10 Stew.) 123, affirmed on appeal for reasons stated below, Vice-Chancellor Van Fleet (at p. 127), adopts the rule of priority laid down in the Heath Case, but it appears by the case that the conflict was between claimants under orders which were presented on or shortly after their dates, and subsequent claimants under lien law notices, so that no occasion for the discussion of the present question arose. In other cases cited, the prior' assignee had in fact given notice of his assignment, and the effect of the general statement of the rule as to priorities made in some of the opinions, made without any special discussion, is qualified by this fact. Among these are Kirtland v. Moore (Vice-Chancellor Van Fleet, 1885), 40 N. J. Eq. (13 Stew.) 106; Bank of Harlem v. Bayonne (Vice-Chancellor Green, 1891), 48 N. J. Eq. (3 Dick.) 246, 252, affirmed on appeal for reasons stated, Ibid. 64-6. Considering the effect of all the decisions in our own courts up to the present time, to which I have been referred or which I have found, I reach the conclusion that in none of them has the precise question now in dispute been directly involved, considered and decided, and that the decision of the question is not controlled by precedents heretofore established.

Considering the question as here res nova and to be settled on principle, I think the sound equitable rule is that' notice by a prior assignee to the trustee is necessary in order to protect him1 against a subsequent assignee who is a purchaser for value in good faith and without notice. The equitable ground upon which the rule rests is the one adopted finally and after much discussion, viz., that the failure of the prior assignee to give notice is a negligence which leaves the assignor in a position where by his apparent ownership he is able to deal with the property in a manner to defraud or injure any subsequent purchaser notwithstanding all due inquiry made.

Placed upon this ground of negligence, the doctrine of notice, as applied in this case, would seem to afford a further illustration of the general principle as to notice stated by Mr. Justice Garrison in Fisher v. Bull, 52 N. J. Eq. (7 Dick.) 298, 309, that “at bottom the doctrine of notice is part of the law of negligence.”

It has not been disputed in the case that all of the subsequent assignees were purchasers for value and without notice of the previous assignment to L. F. Robertson & Sons.

On behalf of the defendant -Bernheim, two further objections were raised to the claim of L. F. Robertson & Sons. First, that their assignment was not an assignment effecting a present transfer of an interest in the fund, but a mere order to pay a specific sum of money out of that interest, and which was not effective until presented to the executor or trustee of the fund. This objection is not well founded in fact, as the document contains the clause: “I hereby assign, quitclaim and release so much of my interest in said estate as may be necessary to pay said claim of $4,000 with any accrued interest.” This clause follows the order on the estate to pay. As appears by the proofs this assignment was executed and delivered to the assignee on May 14th, 1901. It was, however, then dated “Feb. 1, 1906,” being the date on which George’s $30,000 legacy and his share in the estate was payable if he survived. The assignee received at the same time as further security policies of insurances on George’s life. The document as an assignment was intended to be effective from the date of delivery, but the payment was not to be made until the date fixed by the order.

A further objection was made that the present defendant “L. F. Robertson & Sons;” a corporation subsequently formed, had not shown title to the assignment which was made to the firm of “L. F. Robertson & Sons.” No written assignment from the firm to the corporation has been produced, but due proof has been given that it was made, and cannot now be found, and that this claim against George B. Jenkinson was part of the assets of the firm, in fact taken over by the corporation. An assignment of the claim against Jenkinson is valid by a delivery of the evidences of debt without writing, and the security would in equity follow the claim.

I will advise a decree settling the priorities on the above basis, and on the settlement of the decree will hear parties interested on the question of interest, if desired.


author: Emery, Y. C.

text:
    Harry Brainen v. Minnie Brainen.
    [Decided February 3d. 1912.]
    In a suit to annul a marriage for defendant's incapacity to consent, evidence held insufficient to show that she was insane at the time of the marriage.
    Heard on petition, answer and proofs.

      Mr, Scml Cohn, for the petitioner.

      Mr. Samuel Koestler, for the defendant.
   Emery, Y. C.

In this case I will state briefly the conclusion reached, leaving a fuller statement and opinion to be filed hereafter, if it seems desirable.

The petition is filed by the husband, Harry Brainen, to annul his marriage to defendant, Minnie Brainen (born Minnie Bloch), on account of the defendant’s incapacity to consent— arising from her lunacy at the time of the marriage. It is filed under the Dworce act, 1907, § 1, subsec. 4 (P. L. p. 474), .authorizing decrees of nullity of marriage when “the parties or either of them was, at the time of the marriage incapable of consenting thereto, and the marriage has not been subsequently ratified.” The marriage occurred at Elizabeth, New Jersey, on January 16th, 1910, and after the marriage ceremony, the parties went to the husband’s residence in Newark, where they lived together until February 28th, 1910, when the wife returned to her father’s home in Elizabeth and has since resided there. Between the time of her return and the middle of June, 1910, the petitioner, by personal calls at the house and by letters to the defendant, made efforts to secure her return to live with him. He subsequently ascertained that several years before the marriage and in the year 1904, his wife had been an inmate of a sanitarium at Summit, New Jersey, under treatment, as the petition says, “for nervousness and melancholia.” The petition for annulment was filed August 12th, 1910. The suit is defended by the defendant in her own person and she has attended the trial (lasting four days, three of them successive) and was herself for over three hours examined and cross-examined at length. There is no question as to her mental competency to defend the suit for herself, including ability to advise with and assist counsel intelligently and also the ability to recall those incidents connected with the marriage ceremony and subsequent incidents at her husband’s home, which are relied on by petitioner to establish insanity, nor as to her ability to give her counter statements as to those incidents.

The defendant was under treatment in 1904 in a sanitarium and Dr. Prout, the physician in charge, who is now called as the petitioner’s expert, described the patient as then suffering from a mild form of dementia prascox—a derangement accompanying adolescence. The sysptoms of this disease, or some of them, are such as are often shown in types of melancholia. After a treatment of about three months, she left the sanitarium to return home, and was discharged improved. The physician says that she had then apparently lost a great many of the symptoms presented when she first came, but still had some of what the physician calls the “stereotyped expressions” of the disease. There are, he says, cases of complete recovery from this disease, and the percentage of partial recovery, where the patient is capable of assuming more or less of the duties of life, is, he says, perhaps as high as twenty-five. From the time of Miss Bloch’s return to her parent’s home in the fall of 1904, up to the day of the marriage, she seems to have been entirely normal in her actions, speech and behavior, which never seem to have given rise to any question as to her mental condition. This is the effect of the evidence produced by the defendant, and the petitioner on his part submits no evidence in contradiction, but for establishing mental disease at the time of the marriage, relies wholly on the inferences to be drawn from incidents sworn to by witnesses produced by him, as to the defendant’s actions and behavior on the day of the marriage ceremony, and subsequently thereto, up to the time of separation, in connection with the admitted derangement in 1904. And as to the proper inference to be so drawn, the case rests mainly, if not altogether, on the expert opinion of Dr. Prout. His opinion is that the incidents sworn to by petitioner’s witnesses, if substantially true, taken in connection with her condition in 1904, show that the defendant’s entering into the marriage contract and the marital relation had brought about a recurrence of the original disease, and the incidents sworn to as occurring on the day and in connection with the preparation for the marriage and the ceremony or contract, taken in connection with the subsequent events, show that she had not fully recovered from the disease at the time of the marriage. On these facts he further gives his opinion that defendant was insane at the time of the marriage and did not understand the nature and quality of the marriage contract. This expert opinion, however, must be considered in connection with the witness’s statement, that in determining sanity, or a recovery from the disease, at the time of the marriage contract, there must be taken into consideration all of the circumstances that follow after the marriage and the patient’s reaction under those circumstances. Later, and on redirect examination, Dr. Prout says, that the circumstances incident to the preparation for the ceremony might have induced a return of the malady, and that in his opinion they did, “because the evidence is of that character that she was already in that state.” Taking all his evidence, this expert’s opinion on defendant’s sanity or the existence of the disease at the time of the marriage , ceremony, must, I think, be fairly considered as so based on, or colored by, his consideration of the subsequent conditions arising out of the completion of the marriage relation itself, that it cannot be taken as controlling the court in the decision of the vital and somewhat narrow question in the case, whether at the time of the marriage contract the defendant’s mind was so impaired by disease that she was not capable of entering into the contract. This is the period to which the legal inquiry is confined. Kern v. Kern (Vice-Chancellor Green, 1893), 51 N. J. Eq. (6 Dick.) 574, 586. In this case the incapacity alleged was mental disease as well as imbecility. Cannon v. Smalley (1894), 10 Prob. Div. 96, 98. This was a case of alleged mental disease. The fact that circumstances subsequent to the marriage and arising even out of the marriage relation itself, brought about a recurrence of the disease, would not justify the annulment of the marriage.

If the petitioner’s evidence be taken as substantially true, it may, in connection with the evidence of the expert, be taken as perhaps establishing that at the time of the marriage contract, a tendency to a recurrence of the disease existed, and that there were some symptoms indicating the danger of such return. A marriage of a patient who has been previously insane from disease cannot be invalidated merely by reason of a tendency, or liability to recurrence.

Such tendency may be a sufficient medical reason why persons subject thereto should not marry, and Dr. Prout’s own evidence on this point is,

“tliat any patient that has recovered from this form of mental disease, and in which there is any future impairment of judgment, should never marry, because marriage will really be visited with disaster.” •

This statement shows, I think, the aspect in which he regards the question of mental capacity at the time of the contract, and that it is the medical rather than the legal aspect. The difference between the two standpoints is emphasized by Vice-Chancellor Green in Kern v. Kern, supra (at p. 586).

The circumstances previous to and in connection with the marriage ceremony, relied on by the petitioner as establishing the existence of disease at that time, to the extent of incapacitating defendant from entering into the contract, relate mainly to the behavior of defendant toward her own father, and, as is insisted, show delusions as to him then existing. Evidence offered' by defendant denies these incidents, or modifies their effect on the point at issue, by showing that the marriage was brought about by a professional matchmaker (a method not unusual among Hebrews of the station and manner of life of these parties), and was entered into by the daughter rather from a sense of duty to her father than from love to her proposed husband. The behavior to the father, if it occurred as stated by petitioner’s witnesses, would under the whole circumstances inducing the marriage, be considered rather as indicating resentment against the father because of the relations in which she was to enter, rather than as indicating any morbid delusion about the nature of the relation or of the nature of the contract itself.


author: Embry, Y. C.

text:
    William B. Wadsworth, as executor, &c., of Mary E. Baldwin, deceased, v. Abbie O. Baldwin et al.
    [Decided February 3d, 1912.]
    1. Where all the parties interested in a fund appear and are heard, an executor or trustee may consent to receive directions for anticipatory payment, but not so where there is any contingency as to the person or persons who may be entitled to the principal, in which case the premature decision would not be binding on the persons subsequently claiming interests in the fund.
    2. When the time for payment of a fund fixed by will arrives, the court, on application of the executor, will direct its disposition, on notice to the person or persons by or on whose behalf claim has been made therefor, and, in the absence of any such claim, on notice given to the attorney-general, as representing the public interest in charitable gifts.
    Heard oil bill and answers.

      Mr. Arthur Lovell, for the complainant.

      Mr. Walter L. Glenn ey and Air. Howard P. Gastle (of the Chicago bar), for the defendants, Abbie 0. Baldwin and others.
   Embry, Y. C.

On this bill filed by an executor and trustee for instructions, one question undisposed of at the hearing was in reference to the payment of the following bequest.

By the will the executor, after making certain payments, was directed to convert the remaining property into cash, and divide the proceeds among legatees named, according to certain proportions. One of the legacies was:

“To my uncle John O. Niles one-twentieth, at his death to go to Home and Foreign Missions.
“The residue of my estate I bequeath to my son Hugh Baldwin for his life, principal to go to his heirs.”

John 0. Niles, the life tenant, is still living, but his life interest has been assigned to (or for the benefit of) the widow of Hugh Baldwin, who is entitled to the residue.

The executor applies for directions as to whether he can now pay this principal sum over to the person entitled to the residuary, estate.

(1) The residuary legatee claims that the gift over is void as a charitable gift for the reason that no definite trustee is named for the distribution of the charitable funds, and the residuary legatee is therefore entitled to the principal upon the death of Niles. No claim has yet been made by or on behalf .of any person or persons (other than the residuary legatee) of any right to or interest in this principal fund after Niles’s death. The residuary legatee offers at the hearing to pay the principal of the legacy at once and without waiting for Niles’s death, if the bequest is valid, but counsel of both the residuary legatee and the executor claim that the bequest of the principal is void, and no interest adverse to this contention appears.

A preliminary question arises as to whether, in advance of the time when the principal is disposed of by the will, the court should undertake to decide the question. Where all parties interested in the fund appear and are heard, an executor or trustee may, I think, consent to receive directions for anticipatory payment, but where there is any contingency as to the person or persons who may be entitled to the principal, the court will not decide as to the disposition, of the fund until it is ready for payment. Such premature decision would not be binding upon the persons subsequently claiming interests.

I have referred to the authorities settling the general rule in New Jersey, in Kidder's Executors v. Kidder (1903), 56 Atl. Rep. 154. Wren the time for payment of the fund fixed by the will arrives, then the court will, on the application of the executor, direct its disposition, on notice to> the person or per-, sons by or on whose behalf claim has then been made, and, in the absence of any such claim, probably requiring notice to be given to the attorney-general as representing the public interest in charitable gifts.

Circumstances also appear in the case which give rise to a doubt whether before directing payment of the fund special notice should not be also given to the Board of Home Missions and Board of Foreign Missions connected with the Presbyterian Church, in case they have not made a claim. It appears by the 'bill and answer that the testatrix was for a long time a member of that church and active in its benevolent work and a generous contributor thereto. Two of these charities were Home and Foreign Missions, gifts to which were administered by the “Board of Home Missions” and “Board of Foreign Missions.” It has been held that a bequest divided “between the Board of Foreign Missions and the Board of Home Missions,” made by a testator who was a member of the Presbyterian Church, was valid and not void by reason of failure to name a trustee. Gilmer v. Stone, 120 U. S. 586.