author: Emery, Y. C.

text:
    Harrison Land Company et al. v. Crucible Steel Company and Town of Harrison.
    [Decided November 28th, 1913.]
    1. Where certain, contractors’ rights of passage over a street extension, which the town was about to vacate, were only those of passage over a highway common to the public, and the injury to them, iu legal contemplation was not different in kind from that which every other citizen sustained, they were not entitled' to sue to enjoin the vacation of such street.
    2. Harrison city charter, section 56 (P. L. 18T8 p. 3.90), authorizes the city council by ordinance to lay out, alter, or vacate any street then or thereafter laid out, and to take and appropriate for such purpose any streets or real estate, on making compensation, to any owner or ¡owners as thereinafter provided. Section 59 defines the method of ascertaining and making compensation ini case of the taking of land's ¡or real estate for opening, altering, widening, or straightening streets, not including vacation.—Held, that the town had power to vacate streets without affording compensation for injury to lands alleged to have been injured thereby, since the vacation constitutes only the release of a public right or easement over the lands.
    3. Where an ordinance providing for the vacation of an extension of 0. street expressly declared that the vacation was made subject to an agreement by the prior owners of adjoining lands, including complainant, that the extension should be open for their use, whether the ordinance, if passed, would release or destroy the rights of the parties under the agreement as against each ¡other, was a legal question, which must first be determined by the courts, and could not be determined on an application for an injunction to restrain the passage of the proposed ordinance.
    4. A court of equity will not enjoin the passage of ordinances which are within the scope of the powers of the municipality.
    5. Where a city ordinance vacating a street extension is alleged to be invalid because of fraud, or passed in the interest of private concerns, and to constitute an abuse of legislative discretion, the remedy of persons suffering no injury to private property is by eertiarari after the ordinance is passed, and not by injunction against its passage.
    On application for preliminary injunction. Heard on bill, supplemental bill and affidavits.

      Messrs. E. A. & W. T. Day and Mr. Chauncey G. ParTcer, for the Harrison Land Company.

      Messrs. Munn & Church, for Booth & Flimi, Ltd.

      Messrs. Peirce & Hoover, for the' defendant Crucible Steel Company.

      Messrs. Michael T. & Hugh C. Barrett, for the town of Harrison.
   Emery, Y. C.

The standing of Harrison Laird Company, the sole original complainant in this case, is based on its right to equitable relief by preliminary injunction as necessary to protect its property from being taken by the defendant municipality without compensation on its vacation of a street. The bill prays an injunction against the passage by the common council of an ordinance vacating portion of a street sixty feet wide, called Cumberland street, lying between Fourth street and lands now or formerly occupied by the Pennsylvania Railroad Company, as the lessee of the United New Jersey Eailroad and Canal Company, about two hundred and thirty-seven feet east from Fourth street, at which point Cumberland street, so far as it is a recognized public street, now terminates. From this location, where the public street terminates, the Harrison Land Company, by virtue of a written agreement made on May 17th, 1901, between the United New Jersey Eailroad and Canal Company of the first part and the Crucible Steel Company of the second part, and the executors of Henry Young (complainant’s predecessors in title) of the third part, and the devisee of William H. Draper of the fourth part, have a right of way over a strip of land sixty feet in width, an extension of Cumberland street easterly across the lands of all the parties to the agreement. The lands of the United railroad and canal company immediately adjoined the easterly terminus of Cumberland street as laid out, and the lands of Young’s estate (now complainants’), adjoined the United Companies’ lands on the east. This strip of land, sixty feet in. width, called by the parties in the agreement “an extension of Cumberland street,” was, by the agreement, “dedicated and appropriated as a road.” The agreement recited that lands owned by all of the parties were part of a tract known as the Preston tract, that no public streets or' highways existed on these tracts owned by the parties, that the Young estate and Draper estate claimed rights of way over the United Companies’ property in the Preston tract, and that it was for the interest of all the parties “that some recognized way to and through such properties be established and that all claims of the parties to private rights of way over such properties or any of them be extinguished,” and, in consideration thereof, the parties covenanted and agreed each with the others and with each

“fhiat a strip of land sixty feet in width, an- extension of Cumberland-street easterly across the said lands of the parties hereto, be and the same is hereby dedicated' and appno-priated as a road', the strip of land so dedicated beginning east of Fourth street, at the end1 of Cumberland street as laid out on the Gilbert map, and- running thence easterly between- the northerly and southerly lines of Cumberland street produced across the lands of the parties,” &e.

The parties of the second, third and fourth parts, it was further stated, “do hereby release and surrender to said party of tbe first part (the United Companies) all rights of way over the Preston tract or any part of it;” and it was further agreed that any of the parties to the agreement might fill in and grade the said road, and that the agreement should be binding upon successors, heirs and assigns. There has been no acceptance by the public of this extension of Cumberland street made by tbe parties, and the rights of the complainant over the extension of Cumberland street are derived solely under the agreement and by virtue of its express or implied covenants. But since the execution of the agreement, and by reason of tbe release thereby of any right of way to other public streets, complainant Land Company now has no right of way or access other than through this extension to any public highway or street of the town. Its property, however, has access to a river front on the Passaic river. The town of Harrison, by ordinance now on third and final reading before its common council, proposes to vacate this portion of Cumberland street two hundred and thirty-seven feet from Fourth street, the vacation, however, to be "subject to the agreement made the 17th day of May, 1901,” between the parties above stated. Proceedings for the vacation were instituted by the application of the Crucible Steel Company, a party to the agreement, which has purchased and now owns also part of the United Companies’ land north of the centre line of the extension, and also owns or controls the lands covered by the street to be vacated. For the vacation of Cumberland’ and other streets named in their application, the Crucible Steel Company offered to pay to the town of Plarrison $8,000, the town, to give in return a quitclaim deed on all the streets vacated. Since filing the original bill, the streets other than Cumberland have been vacated, and the full sum of $8,000 has been paid to the town by the Crucible Steel Company, which also, in connection with this vacation of the other streets, agreed to defend the present suit and to bear the entire expense of defending it, whether Cumberland street should or should not be' vacated. These facts are set up in the supplemental bill.

After the filing of the bill Booth & Flinn, Limited, contractors, who had a previous permit from the Pennsylvania Bailroad Company to deposit waste material on its lands lying on the southerly side of this extension of Cumberland street, procured from the Harrison Land Company a like permit to fill in their lands and also permitting the contractors as the agent of the land company to fill in and grade the street known as Cumberland street or any portion thereof. Booth & Flinn, Limited, have a contract for the construction of a portion of the sewer for the Passaic valley sewerage commissioners, and the securing of space for the deposit of material is a material convenience in this construction. At the time oli securing the Pennsylvania permit, May 20th, 1913, they were assured that Cumberland street was a public street and might be used by them for access to the lands of the railroad company located on its extension. The agreement with the Harrison Land Company, however, was made after the bill was filed. All the lands lying east of Fourth street, including the portion of Cumberland street laid out as a public street, are low-lying, marshy lands, wholly unimproved.

The filling up and grading provided for by these permits will do something toward preparing them for useful occupation, as well as material]}'' accommodate the contractors. The contractors were allowed to intervene as co-complainants and join in the application for preliminary injunction. Complainants seek injunction against the town from vacating the street and executing a deed therefor to the Crucible Steel Company, and that the steel company may be restrained from preventing the use of Cumberland street. So far as the contractors’ rights of passage over Cumberland street are the rights of passage over a highway which is common to the public, and the injury to them, in legal contemplation, is not different in character from that which every other citizen sustains, they have no standing for special protection by injunction. H. B. Anthony Shoe Co. v. West Jersey Railroad Co. (Court of Errors and Appeals, 1898), 57 N. J. Eq. (12 Dick.) 607, 617; Young v. Pennsylvania Railroad Co. (1905), 72 N. J. Law (43 Vr.) 94; Grey, Attorney-General, v. Greenville and Hudson R. Co. (1900), 59 N. J. Eq. (14 Dick.) 372, 377. They must, on this application, stand therefore on their rights of access derived from the Harrison Land Company and depend upon its rights to enjoin the passage of the ordinance. As to these, I reach the following conclusions :

First. So far as the municipality, the town of Harrison, is concerned, the complainant’s right to a preliminary injunction depends upon the power of the municipality to vacate a portion of Cumberland street without first making compensation to complainant. The charter (P. L. 1878 p. 265 § 56) authorizes the common council by ordinance to lay out, alter, widen or straighten and also to vacate any street then or thereafter laid out, “and to take and appropriate for such purpose any lands and real estate, upon making compensation to the owner or owners thereof, as is hereinafter mentioned and provided.” The subsequent section of the charter (59) defining the method of ascertaining and making compensation, extends only to the taking and appropriating of lands or real estate for “opening or altering, widening or straightening streets,” and does not include “vacating.” Complainant’s land is apparently damaged or injuriously affected by the vacation of the street, but its land is neither taken nor appropriated, and therefore does not seem to come within the provision in section 56 for compensation. Unless such provision is expressly directed by statute to be made, stleets may, under our constitution, be vacated without compensation. Dodge v. Pennsylvania Bail-road Co. (Vice-Chancellor Van Fleet, 1887), 43 N. J. Eq. (16 Stew.) 351, 355; affirmed on appeal for reasons stated, 45 N. J. Eq. (18 Stew.) 366 (1889); Newark v. Hatt (Court of Errors and Appeals, 1910), 79 N. J. Law (50 Vr.) 552; Newark & B. R. Co. v. Montclair (1913), 84 N. J. Law (55 Vr.) 46. In the vacation of streets, lands located on the street vacated are not in fact “taken and appropriated” by the municipality, which, on the contrary, only releases a public right or easement over the lands, and therefore it may be well claimed that the provisions of section 59 as to the method of compensation and proceedings for “lands taken” intentionally and properly excluded proceedings for the vacation of streets. And, in my judgment, this omission, construed in connection with section 56 extending the power for compensation only to “lands taken and appropriated,” excludes complainant’s lands from the protection of the provision.

The above authorities, in my judgment, control this case on this point, and the circumstances strongly urged by complainant, that the vacation of this portion of Cumberland street will cut off their access from any public street, if it be true, does not relieve the case from the operation of the rule affirmed by these decisions in relation to the power of municipalities to vacate public streets without compensation where none is provided by statute. The municipal authorities were not parties to this agreement by which complainant land company and others gave up the private waj's from their lands to other streets. They cannot, therefore, merely for the reason that complainants have now no other access be subject to any equities as to compensation on the vacation of a street to which complainant had no right of access previous to the agreement, and whose rights of access thereto rest only on the private agreement. The fact that the private ways claimed by the complainants and released by the agreement did lead to other public streets, is important in answer to the present claim of a right to compensation for vacation, arising on the special ground of cutting off the sole access. But complainant may not, by the passage of the ordinance in question, be certainly cut off from access to public streets, and for two reasons—first, complainant’s right of access to the entire width of the portion of Cumberland street proposed to be vacated, which adjoins the land dedicated as a road, exists under the agreement set out in the bill, and complainant claims that by virtue of this express agreement it has, as against all persons bound thereby, a right to have the dedicated road constitute “an extension of Cumberland street” as it then existed. Now, the ordinance of vacation expressly provides that the vacation is made subject to this agreement, and the question fairly arises, whether the vacation made with this express limitation does release' or destroy the right which the parties under the agreement had, as against each other, to have Cumberland street continue as a public street; and there may also be a question whether a vacating 'ordinance thus restricted is a proper exercise of the power of vacating streets. But these are questions of legal right, first subject to review in the courts of law, and cannot be decided in this court on this application which involves purely the right to a preliminary injunction against passing the ordinance as proposed. The powrer to vacate streets is, in its general nature, a legislative power, and the proposed exercise of it in this instance is purely legislative. It is well settled, as a general rule, that a court of equity will not enjoin the passage of ordinances which are within the scope of the powers possessed by a. municipality. Cape May, &c., Railroad Co. v. City of Cape May (Vice-Chancellor Van Fleet, 1882), 35 N. J. Eq. (8 Stew.) 419, 421; 21 Am. & Eng. Encycl. L. 951 (note 1), citing cases. In the second place, the title in fee to a portion of Cumberland street proposed to be vacated is now in the defendant the Crucible Steel Company, one of the parties to the agreement set out in the bill. Complainant’s right as against the Crucible Steel Company to the access over the lands included ■within the vacated street for ingress and egress to all parts of tin's “recognized way” to and through Cumberland street of which the road or way was to be the extension, may remain, notwithstanding the vacation. This question will properly come up for adjudication, not as the necessary result of the vacation of the street, but as the result of the obstruction of the complainant’s access over the vacated street to the only public street, if the street be vacated and such obstruction made by the Crucible Steel Company.

No preliminary injunction can therefore be granted in this case, and in view of the above decisions (H. B. Anthony Shoe Co. v. West Jersey Railroad Co., &c.), my present view is that in the absence of any special property right of the complainant which would be taken or appropriated by vacation of the street, the passage of the ordinance cannot be enjoined by this court, even at final hearing. The claim that the passage of the ordinance is solely in the private interest and benefit of the Crucible Steel Company, and for the purpose of allowing it to occupy and use the street for its private purposes and upon a money consideration paid therefor, is a claim or contention based on the rights of the public to an exercise of the power of vacation in. the public interest and not for private interest. After the vacation is made, the special interest which the complainants have in the continuance of the public street as owners of lands injuriously affected thereby may be sufficient to allow them to question the vacation by certiorari. Beecher v. Newark, 64 N. J. Law (35 Vr.) 475; affirmed on appeal, 65 N. J. Law (36 Vr.) 307 (1900).

Under our practice, when the validity of an ordinance, contract or other act, within the power of the municipality, is attacked, because of fraud or other improper motive, or abuse of legislative descretion, such as being solely for the benefit of private interest, it has always been by certiorari, removing the complete act which is questioned to the supreme court. After the act, and generally not until then, can the question as to the character and operation of the motives for the exercise of admitted powers be fairly at issue or tried, and in all of the New Jersey cases brought to iny attention, where no private property was entitled to protection by injunction, the issue of the invalidity of the ordinance upon any of these grounds was raised, tried and decided on certiorari proceedings, which either affirmed or set aside entirety the ordinance to all the public. North Baptist Church v. Orange (1891), 54 N. J. Law (25 Vr.) 111, is an instance where the validity of an ordinance opening a street was questioned after its passage on the ground that it was improperly induced by the promise of a citizen to pay part of the expense, and in many eases the supreme court, .after the adoption of the ordinance or contract, has passed on the question whether it was an honest exercise of their discretionary legislative power. Ferguson v. Passaic (1897), 60 N. J. Law (31 Vr.) 404: Kraft v. Board of Education (1902), 67 N. J. Law (38 Vr.) 512, 514.

The control in this ease of the passage of the ordinance by an injunction dependent on a decision beforehand as to the motives for its passage, would, in my judgment, be an unauthorized interference with the exercise of the legislative power given to the municipal body.


source: Caselaw Access Project

author: Emery, V. C.

license: Public Domain

text:
    Johanna C. Tonn v. Alex. Pier et al.
    [Decided January 9th, 1914.]
    1. Where, in a suit to enforce vendor’s lien, it was admitted that payment of the purchase-money, though recited in the deed, was not made at the delivery of the deed, the burden of proving payment subsequent the'reto was on defendant.
    2. Evidence, in a suit to foreclose vendor’s lien, held not to show that the vendee, subsequent to the delivery of the deed, made a payment to the vendor.
    3. Where an attorney representing a vendee went to the home of the vendor, an old woman, and drafted an agreement of sale, the agreement providing for the execution by the vendee of a mortgage to secure the purchase-money, and the attorney undertook to represent the interests of the vendor in securing the mortgage, he should have, upon the execution of the deed, seen that her interests were protected, and that the mortgage was delivered.

      Heard on bill, answers, replication and proofs.

      Mr. Adam J. Bossbach, for the complainant.

      Mr. Clarence W. Blatt and Mr. Philip J. Schotland, for the defendants.
   Emery, V. C.

This bill is filed to enforce a vendor’s lien for unpaid purchase-money due to the complainant on the conveyance of her lands to the defendant. The lands were conveyed by virtue of a written contract of sale, in which the complainant agreed to convey for the sum of $2,530 a house and lot in Newark, New Jersey, the purchase-money to be paid $30 on the execution of the agreement, $1,000 by the payment of an existing mortgage on the premises, and the balance of $1,500 to be secured by a purchase-money mortgage, which should be the first mortgage. The $30 was paid, but the $1,000 mortgage has not been paid, nor has the $1,500 mortgage been given. Defendant received the deed on January 6 th, 1912, but no mortgage nor any other memorandum or writing was then given to the complainant for the purchase-money.

The question is whether, subsequent to the deed and on February 14th, 1912, this purchase-money, $1,500, was paid to the complainant by the defendant in cash (bills, as he says, of $50 and under) at her house on that day. The burden of proving this subsequent payment is on the defendant, for it is admitted that the payment, although recited in the deed, was not made at the time of its delivery. The defendant produces a receipt for this sum of money, signed by the complainant, but undated, and the circumstances attending the delivery of the deed, and also the alleged payment of this sum of money to the complainant are such as to make the general rule of putting upon the defendant the burden of proof specially and emphatically applicable. Complainant is an old woman, nearly seventy-five years of age, an invalid and a German, who speaks very little English and cannot read or write the English language. She can write her own name in German, and the receipt is so signed. The receipt, however, is written in English, and the payment of the money, if made at all, was made in a room of. complainant’s house where no one was present except the complainant and the defendant. Defendant says there was another person in the house with complainant when he went to pay the money, a woman whom he did not know, but that complainant and he went into another room and were alone at the time of pajanent. There was, therefore, no one other than the defendant to explain to her the terms of the paper which she signed as a receipt for $1,500, and the complainant swears that she did not receive this sum of $1,500, either at that time or at any other, and that as she understood, she was signing a paper that she was to get $1,500. -The written agreement for sale was drawn by a young attorney just admitted to the bar, who was employed by the defendant to draw the agreement, and went with, him to the complainant’s house for that purpose. The agreement provided, among other things, that the complainant should remain in the premises free of rent during her life, and that the mortgage to be given to her should bear five per cent, interest and remain in force for a period at the option of defendant so long as the interest was regularty paid. This house and lot was substantially the only property the old woman owned. The occupation of the property and the interest on the mortgage would be substantially her entire provision for her support. At the time the agreement was signed the attorney for the defendant undertook to draw for the complainant the mortgage securing the purchase-money, and lie was to prepare the deed. It does not appear that he ever did in fact draw the mortgage, and according to his account, the defendant having told him that he was going to pay the amount in cash, he did not,’ when he went to have the deed executed and delivered, take with him any mortgage,' and he had the deed executed and delivered and recorded without securing the complainant in any way for her unpaid purchase-money upon the delivery of the deed, or securing for her any evidence that it was still due to protect her against the deed itself. By assuming to draw the mortgage for the complainant, under the agreement, the attorne3r undertook the duty of taking care of her interest as well as that of the purchaser upon the delivery of the deed. He now gives contradictory statements of what took place at the time of the delivery of the deed. His first- statement was that he did not take up the matter of the $1,500 with the complainant in any way beyond that

“I asked her if it was agreeable to her, what Mr. Pier said about paying off the $1,500; I asked her whether that was agreeable to her. Q. What did she say? A. She said Wes.’ ”

On further examination, being asked whether there was any talk, whatever about the $1,500 mortgage, at the time of the execution and delivery of the deed, he replied, “I don’t think there was; I don’t remember,” and being asked what ivas said or done, if anything, about the .$1,500, he says:

“Mr. Pier had told me that he was going to pay it, or whether he did pay it, I don’t remember; he told me that the $1,500 was to be paid; whether it was paid or was to be paid, I don’t recollect now. Q. Was to be paid how? A. In cash. Q. What did Mrs. Tonn say about it? A. I don’t remember whether she did say anything about it or not.”

These admitted facts in the case show that by the action of the defendant and his attorney it occurred that the title was actually secured for this property without payment or security, of any kind for the unpaid purchase-money, or any evidence to show that the purchase-money was unpaid, and that this condition continued until the middle of February. The attorney seems, according to his account, to have had no further connection with the matter whatever of paying or securing the amount. There was a clear violation of the duty on his part to protect the interest of this old woman, on talcing the title to her property from her, and this whole situation which existed from the time of receiving the deed up to the time of the alleged payment of the money in February, shows the business advantage that was taken of her and imposes on the defendant the decided.burden of proving by testimony other than his own that this money was paid. It should be further stated that the provision in the agreement drawn by the attorney, by which complainant was to remain on the property during her life, was omitted from the deed. This omission may have occurred by reason of the inexperience of the attorney, but it is, nevertheless, a circumstance to be considered in connection with the entire outcome of a transaction on the part of the defendant which secured the delivery of a deed giving a free and clear title at once without the payment or security of the purchase-money, or any evidence that it was still unpaid.

There are also circumstances which corroborate to some extent the • statement of the complainant that there was no payment. One of these is the payment of a sum of $23.50 in March, 1913, which, as- is sworn to by complainant and two other witnesses, was paid expressly as interest to the complainant. And it was not until after this payment by him, and after subsequent inquiries of him and his lawyer and a mortgage was insisted on, on her behalf, that the claim was made that the money had been paid and this receipt was produced. The defendant on his part proves that he had the money for the payment of the mortgage and that a sum of $2,200 was drawn in cash from the bank in which he held his deposit, on the day of the payment, and it is claimed that this corroborates his story. To a certain extent it does—that is, as showing that he had this sum at that time, sufficient to make the payment, but this, of course, does not prove the payment, and to countervail proof of this character, there is, upon the other side, proof by the complainant that she has not now and never had any such sum of money as defendant claims to have paid to her. The question finally resolves itself into one as to whether the money was in fact then paid and whether the payment has been established. On the whole case I conclude that payment has not been established and I will advise a decree declaring that the purchase-money of $1,500, with interest, to be a lien upon the premises. Defendant having repudiated his obligation to pay either the principal money, to be secured by mortgage, or interest thereon, the unpaid purchase-money with interest is due at once. Decree will be settled on December 30th.


text:
    William Umbach v. Julius Umbach et al.
    [Decided January 13th, 1914.]
    1. Under act of April 20th, 1906 (4 Gomp. Stat. 1910 p. 4686 § 35), providing that any purchaser of real estate at any public sale, with certain exceptions, shall be relieved from his bid if he shall satisfy the court of the existence of any substantial defect in or cloud upon the title rendering it unmarketable, or of the existence of any lien or encumbrance unless a reasonable description of the estate or interest to be sold, and of the defects in title, be inserted in the advertisements and in the conditions of sale, a purchaser is not entitled to be relieved from his bid if the title can be made good at the time of the decree.
    2. A purchaser at a partition sale was not entitled to be relieved from his bid because of an erroneous description of the premises, .where the description referred to the correct survey which was attached to the decree.
    3. The act of February 16th, 1891 (P. L. 1891 p. 84), providing that all sales of land made under any order, judgment, or decree of a court shall be confirmed by the court notwithstanding any irregularity in the publication of such sale, provided the officer making the sale shall certify under oath that it was otherwise regular and that the property was sold for a fair price, and the court is satisfied by affidavit that the defect was not injurious to the parties in interest, applies to sales made after its passage, notwithstanding the failure or omission of the commission to include it in the compiled statutes.
    4. Where the final decree in a partition suit expressly directed that the deed delivered pursuant to the sale thereunder should be a perpetual bar, both in law and in equity, against all the parties, the estates in curtesy of two defendants were thereby cut off, and the purchaser could not have relief from his bid because of the existence of such estates, especially where such defendants offered to execute releases of their interest without further consideration.
    o. That a decree in a partition suit did not specially direct the sale of the estates by the curtesy initiate of certain defendants did not entitle the purchaser to relief from his bid, since the statutes requiring such special directions do not apply to inchoate but only to completed estates.
    6. Under the act of April 20th, 1906 (4 Gomp. Stat. 1910 p. 4686 § 35), providing that any purchaser of real estate, at any public sale with certain exceptions, shall be entitled to be relieved from his bid if, before delivery of the deed, he shall satisfy the court of the existence of any substantial defect in or cloud upon the title rendering it unmarketable, or of the existence of any lien or encumbrance, unless a reasonable description' of the estate or interest to be sold, and of the defects in title and liens or encumbrances with the approximate amount thereof, be inserted in the notices and advertisements required by law and in the conditions of sale, where the decree in a partition suit and the notices and advertisements of sale stated that a mortgage in a specified amount was a lien on the premises, such advertisement of sale was read by the master at the sale in announcing the conditions of sale, and the purchaser signed the conditions of sale to which a copy of the advertisement was annexed, and received the master’s receipt, both of which stated the price as the full amount bid, the purchaser was not entitled to be relieved from his contract with the master because of conversations with the complainants and one of the defendants, who also owned the mortgage, from which he was led to believe that the land was to be sold free from the mortgage, or that the mortgage was to be paid out of the purchase-price, whether or not he was entitled to relief as against the complainant and such defendant.
    On petition of purchaser and counter petition of complainant. Heard on petitions and answer and affidavits.

      Mr. Edwin B. Goodell, for the purchaser.

      Mr. Anderson Pnce, for the complainant.
   Emery, V. C.

There is in this case an application to be relieved of his bid, made by petition filed in the cause by the purchaser at special master’s sale in partition, and a counter petition by the complainant against the purchaser Jacob W. Grissing to compel him to perform' the contract of purchase. The petition of the purchaser is filed under the Sales act (Revision), supplementary act approved April 20th, 1906 (P. L. 1906 p. 269 ch. 144; 4 Comp. Stat. pp. 4635, 4686). which entitled a purchaser

“to be relieved of his bid, if before the delivery of the deed he shall.satisfy the court, by whose authority such sale was made, of the existence of any substantial defect in or cloud upon the title of the premises sold which would render the title unmarketable, or of the existence of any lien or encumbrance thereon, unless a reasonable description of the estate or interest to be sold, and of the defects in title and liens or encumbrances thereon with the approximate amount of said liens and encumbrances, if any, be inserted in the notices and advertisements required by law and in the conditions of sale.”

' Before the passage of this act, the caveat emptor rule applied to judicial sales (Brady v. Carteret Realty Co. (Court of Errors and Appeals, 1904), 67 N. J. Eq. (1 Robb.) 641, 643; Podesta v. Binns (Vice-Chancellor Garrison, 1905), 69 N. J. Eq. (3 Robb.) 387), and it was also settled that the purchaser at judicial sales becomes a party to the suit by virtue of his bid and signing the conditions of sale (Boorum v. Tucker (Vice-Chancellor Pitney, 1893), 51 N. J. Eq. (6 Dick.) 135), and that either party, as well as the officer selling, might file an independent bill, or make summary application in the suit itself for the performance of the contract. Cropper v. Brown (Vice-Chancellor Garrison, 1909), 76 N. J. Eq. (6 Buch.) 406; Townshend v. Simon (Judge Depue, 1876), 38 N. J. Law (9 Vr.) 239 (at p. 243). And the rules applicable to the cases of specific performance of contracts strictly inter partes are in general enforceable on these applications. Boorum v. Tucker, supra, and cases cited (at pp. 139, &c.) ; Podesta v. Binns, supra. One of these settled general rules is, that if the title can be made good at the decree, it is sufficient to overcome a valid objection made to the title. Oakey v. Cook (Court of Errors and Appeals, 1886), 41 N. J. Eq. (14 Stew.) 850, 864; Agens v. Koch (Vice-Chancellor Emery, 1908), 74 N. J. Eq. (4 Buch.) 528; Redrow v. Sparks (Vice-Chancellor Learning, 1909), 75 N. J. Eq. (5 Buch.) 399.

The objections here made to the title are all founded on defects, or alleged defects, which, so far as they exist, can all be removed before or at delivery of the master’s deed. The objection of erroneous description of the premises is corrected in the description itself by the reference to the correct survey, which is attached to the decree. The defective advertisement of sale which for a single week was inserted in only one, instead of two, newspapers, has been cured by a special order of confirmation made under the act of February 16th, 1891. P. L. 1891 p. 24-This act applies to sales made after its passage, as I held in Polhemis v. Priscilla (1903), 54 Atl. Rep. 141. This decision, made after full hearing, cannot be considered as overruled by the failure or omission of the commission to include the act in the compiled statutes. This compilation is necessarily ex parte and not intended to formally adjudicate on questions like those now involved in reference to the application of this act.

It is also objected that this decree for sale in partition fails to direct, as the statute requires, that the estates in curtesy of two of the defendants should be sold. The final decree, however, directs expressly that the deed delivered, pursuant to the sale under the decree, shall be a perpetual bar both in law and equity against all the parties, and it may be fairly claimed, I think, that under such decree the deed will cut off such estates in curtesy. Bat to avoid any question, these two tenants by the curtesy now voluntarily offer to execute an cl deliver with the master’s deed and without further consideration therefor, releases of their respective interests and estates. This removes this objection. The further objection that the decree does not specially direct the sale of the estates by the curtesy initiate of other defendants is not well founded. The statutes relied on as requiring such special directions in the decree do not apply to inchoate, but only to completed estates, and these parties defendant having inchoate interests are barred by the general terms of the decree.

The objection mainly insisted on at the hearing to relieve the purchaser from his bid, related to the lien of a $1,000 mortgage on the premises, held by Julius Umbach, one of the parties defendant. The purchaser now claims that his bid of $7,000 for the property, at which price it was struck off and sold to him, was intended to be for the property free of the $1,000 mortgage, and he therefore asks to be relieved of his bid. The decree for sale declared that this mortgage of $1,000, with interest from July 15th, 1905, was a lien or claim on the premises directed to be sold, and also that they were subject to a right of way of the Caldwell Railway Company under an agreement dated November 5th, 1890, made with the decedent. The notices and advertisements of sale stated expressly that a mortgage made by Henry Umbach, deceased, to Julius Umbach for $1,000, with interest from July 15th, 1905, “is a lien upon the premises described,” and also that they were subject to the right of way above mentioned. The sale by the special master took place at the place and at the time advertised, the court house, in Newark, September 17th, 1913, and the advertisement of sale, including this statement as to liens, was read by the master in announcing the conditions of sale. According to one affidavit, it was also specially announced that the sale was to be subject to this mortgage of $1,000 and to the right of way. The special master himself so understood the terms of sale, and during the sale nothing seems to have been brought to his attention, indicating that any other view was taken by any bidder. The purchaser, Mr. Gris-' sing, stood in front of the master while the description of the premises and conditions of sale were being read, including these statements as to the mortgage and right of way, but made no inquiry of the master in reference to the sale being subject to the lien of the mortgage. The bidding started at $5,000 by a Mr. Cowie, and was continued by bidding between Grissing and Julius TJmbacli, who was the mortgagee, and also one of the heirs, until it ran up to $7,000, at which figure it was struck off to Grissing. He then signed the written conditions of sale, to which a copy of the advertisement was annexed, as follows: “I hereby acknowledge myself to be the purchaser of tract of land and premises described in the annexed advertisement for the sum of $7,000,” and on the 19th of September paid to- the master $1,000, for which the master signed a receipt at the bottom of the conditions of sale, as received

“on account of the purchase price of the lands and premises described in the annexed advertisement and referred to in the foregoing conditions of sale, upon the terms and conditions therein specified. The balance ($6,000) six thousand dollars to be paid as therein provided at the time and manner therein stated.”

These conditions of sale signed both by the master and the purchaser make the written contract of sale of the lands required by the statute of frauds, and there,can be no question, I think, that so far as the case is to be considered as one of mutual contract between the master and the purchaser evidenced by the writing, the sale was made and intended to be made subject to the mortgage of $1,000. No relief from the bid based on the act of 1906 can be given, because the requirements of the statute in reference to the existence of liens upon premises sold at judicial sale were complied with by the statement or reasonable description of the lien on the premises to be sold, with its approximate amount inserted in the notices and advertisements and in the conditions of sale. These statutory requirements being fulfilled, the purchaser fails to bring himself within the extension of the statute to relief from purchase at a judicial sale. The purchaser does not, either in his petition or in his answer to complainant’s petition, attempt to make a case within the statute, by alleging or setting up that the existence of this lien of the mortgage upon the premises sold was not disclosed by the advertisements of sale and by the conditions of sale which he signed. His claim for relief is that by reason of conversations had on the day of sale and before the sale between himself and Julius Umbach, one of the defendants, and the mortgagor, in which complainant participated, relating to the amount which he (Grissing) would bid on the property, he (Grissing) told them he would not bid over $7,000 for a free and clear title, and that subsequently when he read the advertisement mentioning the mortgage as a lien, he was again told by Julius Umbach that the price bid for the property was for a deed free and clear of all encumbrances. Julius Umbach, the owner of the mortgage, and of one-seventh interest in-the premises, was prepared to bid on the property in the protection of his double interest, and did in fact bid against Grissing, they being two probable purchasers. In this aspect of the case, that of ascertaining the amount either would bid, the interest of Julius Umbach, as well as that of Grissing, apparently was adverse to that of the other parties interested in the sale, some of whom were infants, and the understanding with Julius about the status .of his mortgage, even if Grissing afterwards acted on it, cannot be considered as any sufficient reason for relieving him from his contract with the master who had prepared the advertisement and conditions and had the sole control and conduct of the sale for the benefit of all parties.

The affidavit of Cowie, one of the petitioner’s witnesses, shows that in a talk with Julius Umbach, who himself proposed to bid on the property and was willing to bid $7,000 for it as his highest price, Julius said to Grissing: “You shall have the property for $7,000, unless somebody bids higher, and that after it got up to $7,000, he (Julius) would stop bidding.”

After this talk by themselves, the four persons went to the corridor, where the property was put up for sale by the master, and the advertisements and conditions of sale were read. This witness Cowie started the bidding at $5,000, and then Grissing and Julius Umbach bid against each other until Grissing bid $7,000, when it was struck off to Grissing. If any understanding or arrangement was reached before the sale that Grissing should have the property for $7,000, this was a private understanding between the parties making it, and under the circumstances, no understanding between these parties as to the price to be paid for a clear title should be allowed to affect the sale by the master in reference to the question whether the price bid to the master did or did not include the payment of the mortgage lien. The advertisements and the conditions settled that question, and if the purchaser without any inquiry of the master relied on any other statements, it was at his own risk.

From the petitioner’s own affidavit as to his conversation with Julius before the sale, it appears that the latter referred to a diversity or division of interests in the property among the heirs, and also in reference to Ms mortgage, and it further appears that after Julius made an agreement with Grissing to stop bidding at $7,000, they both went in to carry out this arrangement. The purchaser distinctly says:

“That he notices the advertisement mentioned a $1,000 mortgage and did not say that the property was to be sold subject to the mortgage, and that having come to an understanding, as I supposed, with the parties in interest, as to what my bid would mean, I paid no further attention to the advertisement.”

Both Julius and William Umbach in their affidavits deny any understanding that the property was not to be sold subject to the mortgage and insist that Grissing understood at the time that it was sold subject to the lien. These conflicting affidavits are perhaps reconcilable by the view that it may have been the expectation of these three persons that although the mortgage was a lien on the premises, tyet it was to be paid out of the purchase price, and that the bid of $7,000 for a “good” or “clear” title was made on that basis. This might show a case which, as between the purchaser and William and Julius Umbach, and if it were a matter to be settled between them alone, might entitle the purchaser to claim that the mortgage, although a lien, should be paid out of the purchase price bid, as the court is expressly authorized to do, by the statute of 1906, and to require the bid to stand. But this situation, if it existed between these persons, could not affect the master and the contract with him, nor does it entitle the purchaser to be relieved from his contract made with the master for the benefit of all the parties to the suit, without any knowledge of or participation in this private arrangement. This contract of the purchaser with the master was at a sale in which the master himself complied with the provisions of the statute relating to the statement of the existence of the lien, and purchasers about to bid were notified by him of .the existence of the mortgage as a lien on the premises.

This contract with the master should therefore be specifically performed.

The petition of the purchaser should be dismissed and that of the complainant granted. At the time of settling' order I will hear counsel on the question whether the orders should be made without prejudice to any application for relief, either in this suit or otherwise, by the purchaser against either Julius or William ITmbach, individually. On his present application the eom|Dlainant rejoresents the master and all the parties to the suit, and this case must be decided upon those rights.


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    Cornelius C. Vermeule v. John D. Vermeule et al.
    [Decided January 19th, 1914.]
    1. An action on notes will not be temporarily enjoined on the ground that it involves a partnership transaction where, from the affidavits for and against the preliminary injunction, it is doubtful whether the co-partnership exists, and it appears that the notes were special transactions not relating to the partnership affairs.

      2. On a bill to enjoin an action at law on the theory that the action arose out of a partnership demand, and to require an accounting between the parties, where the evidence establishes a joint adventure the parties will be decreed an accounting, though the bill specifically alleges the existence of a partnership.
    3. In a suit to enjoin the prosecution of an action on notes given by complainant on the ground that the notes were part of a transaction relating to a joint adventure between the parties, and that complainant was entitled to an accounting before being sued in an action at law, evidence held insufficient to establish the existence of a joint adventure entitling him to an accounting.
    Heard on bill, amended bill, answer and amended answer, replication and proofs.

      Mr. Robert H. McCarter and Messrs. McCarter .& English, for tbe complainant.

      Mr. Shewerd A. Depue and Messrs. Lindabury, Depus & Faulks, for the defendants.
   Emery, V. C.

The occasion of filing this bill was the commencement of a suit in the supreme court of this state by John D. Vermeule, one of the two original defendants, against complainant, Cornelius C. Vermeule. The suit was brought in September, 1901, to recover the amount claimed to be due upon three notes, two of them being notes for $5',000 each, drawn by C. C. Vermeule, payable to his own order and endorsed by defendant John D. Vermeule for the accommodation of the maker, discounted for complainant’s benefit, and which J. D. Vermeule, as endorser, paid at maturity, at the maker’s request. The third note was a note of a Maine corporation called the York Cliffs Improvement Company, for $10,000, dated November 24th, 1897, and payable to John D. Vermeule on demand, executed by complainant as treasurer of the company. Hpon this note was an endorsement, that it was given to be held by J. D. Vermeule as collateral security for moneys to be advanced by him to the company to pay its then outstanding bills payable, accounts payable and current expenses, and a further endorsement signed by the complainant, “1 hereby assume liability for all moneys to become clue or to be secured by this note to the extent of eleven twenty-sevenths of the entire amount.” In the suit at law, defendant J. D. Vermeule alleged that the $10,000 was subsequently advanced to the company, which failed to repay, on demand, and judgment for eleven twenty-sevenths thereof, with interest, was claimed on the guaranty of C. C. Vermeule.

. Previous to the commencement of this suit in New Jersey, the defendant John D. Vermeule had commenced an action against the complainant in the supreme court of the State of New York, to recover the amounts claimed to be due upon the same three notes, in which action the complainant had set up a number of defences, including defences thereto claimed to be equitable defences to the action and which are the basis or foundation of the present bill to enjoin the suits at law. An injunction was prayed against further prosecution of the suit in New York as well as the suit in New Jersey.

As to all three of the notes the general claim alleged by the bill is that they were given in the course of and in connection with a co-partnership existing between the complainant, the defendant John D. Vermeule and the defendant Joseph N. Kinney, in a speculative enterprise of exploiting, developing and marketing lands at the seaside resort, York Cliffs, in the State of Maine, and were given to raise funds to be used in this partnership. .And it was further claimed that no final accounting had been made of these partnership transactions between the partners, that the other two partners had, in reference to certain transactions set out in the bill, become accountable to him and that no equitable settlement of -the affairs of the partnership could be made unless the claims against the complainant arising out of said notes were adjusted in connection with the settlement of the affairs of the partnership. As to the two $5,000 notes, the further claim was made by the bill that by reason of certain dealings relating thereto specially set out in the bill, between the complainant and J. D. Vermeule, including the assignment to the latter of the complainant’s book account against the company and of certain shares of complainant in the stock of the company, which stock J. H. Vermeule held as collateral for the notes, these two notes of $5,000 each were paid, as between defendant Vermeule and complainant, and complainant was no longer liable to J. D. Vermeule upon them.

The answer of J. D. Vermeule, and the affidavits filed on his behalf, denied the formation or existence of any partnership, to any extent or for any purpose, and claimed substantially that the notes in question were, as between the parties thereto, special and separate transactions not connected with any other accounts or transactions between them. And, the special defence set up to the two notes claimed to have arisen out of the dealings between the two Verineules alone being a legal rather than an equitable defence, the preliminary injunction against further prosecuting the suits at law was denied, both because of the doubts raised as to whether a partnership existed, and also because, even if a co-partnership did exist, the affidavits seemed to warrant the conclusion that these notes were special transactions in which the complainant had expressly agreed to pay these debts, and must pay them if liable, getting allowance for the payment, if entitled to it, on any final accounting. The prosecution of the suit to verdict and judgment should not therefore be enjoined. 2 Lind. Part. *-566. This denial of a preliminary injunction was, however, without prejudice to renewal of the application after judgment at law. Upon the trial, at law verdict was found for the defendant in the suit at law, the complainant herein, upon the two $5,000 notes, and a verdict against complainant, upon his guarantee of the York Cliffs Improvement Company note. Judgment in favor of John D. Vermeule against the complainant was entered in the supreme court on June 5th, 1906, and on August 1st, 1906, the amount of the judgment, with interest and sheriff’s execution fees ($5,694.01), was paid into this court, as a condition of enjoining execution. After this judgment at law complainant brought. suit in the supreme court of Maine on October 27th, 1906, against the York Cliffs Improvement Company to recover from it this amount of $5,694.01, thus paid by complainant into court as surety on the company’s note of November 24th, 1897, and on April 26th, 1909, complainant recovered judgment for this amount with interest from August 1st, 1906, the date of payment into court, $6,551.90, and costs. This judgment against the company obtained in Maine was satisfied by sale of the company’s lands on execution on the 10th day of July, 1909. This suit in Maine, brought by complainant against the York Cliffs Improvement Company in October, 1906, was still pending and undetermined at the close of the taking of proofs at the original hearing in this cause in February, 1909, but was proved at a further hearing on July 29th, 1910, had upon an opening of the proofs and filing an amendment to the answer.

It was further specially claimed by the bill that in the course and prosecution of this alleged partnership, two corporations were organized in the State of Maine to take over the partnership lands for the purpose of developing and marketing the lands, but that the organization and operation of the corporations and their ownership were incidental to the prosecution of the partnership which, as is alleged, continued after their formation, and still continues. The bill specially charges that a large hotel property belonging to the company, which was erected at an expense of over $125,000, advanced by the three partners as a “syndicate,” was mortgaged by the hotel company to a trust company, of which defendant J. D. Vermeule was vice president, to secure $50,000 for advances by J. D. Vermeule and Kinney, for their advances to that amount over and above the amount contributed by the “syndicate” as a firm, and that this mortgage had been foreclosed by the trust company, at J. D. Vermeule’s instance, and the company’s equity foreclosed by a sale to the trust company which now holds the title. This title, the bill alleges, the defendants claim is held in trust for them alone, but complainant claims that it is held in trust for the firm, and constitutes part of the partnership property for which an accounting and allowance should be made. The bill does not specify or claim any other special property as being assets of the firm to be taken over. It prays the dissolution of tire alleged partnership, the appointment of a receiver, if necessary, and an accounting with an injunction against the pending suits by the defendant J. D. Vermeule, for the purpose of having claims upon them brought into the partnership account.

Complainant is a resident of New Jersey, but both the defendants are residents of other states, J. I). Vermeule of New York and Joseph N. Kinney of Maine or Pennsylvania. Defendant Yermeule was brought into court on the application for injunction by service upon his attorney in the New Jersey suit, and subsequently filed an answer in the suit. The defendant Ivinne3r, the other alleged partner, was not served with process, and did not appear in the suit. The answer of the defendant J. D. Vermeule denied the alleged partnership, as did also J. N. I\inne3r, in an affidavit filed on behalf of the defendant J. D. Yermeule.

At the hearing the only asset or property claimed to belong to the alleged partnership was the equity of the defendants, J. D. Yermeule and Joseph N. Kim^, in the hotel property, after the foreclosure, it being claimed that this property, although owned by the company and mortgaged by it, was still, as between the members of the “syndicate,” partnership property, and, therefore, upon the purchase, still subject to an accounting therefor, as between the partners, and without regard to or taking into account the transfer of it to the company. The trust compan}", which holds the legal title, is not a party to the suit. No other property or asset was suggested as an asset of the alleged partnership concerning which an accouarting should be made, but it was claimed that an accounting was necessary as between the partners in order to account for and settle as between themselves their proportionate liabilities on obligations which wore originally or in form personal obligations of complainant, but which were, as complainant claims, obligations of, or assumed by the indicate” or partnership, and therefore the subject of accounting between them, in connection with the $10,-000 note of the company partly guaranteed by Kinney and 0. C. Yermeule. These personal obligations were the notes secured by the mortgages given on the purchase of the lands which were, or were claimed to be, purchased on behalf of the partnership^ the title to which was taken in the name of complainant. He afterwards conveyed all these lands to the York Cliffs Improvement Company, which, upon the conveyance, assumed the payment of the mortgages given by him, but these mortgages (five in number), not having been paid, complainant claims that this proportionate liability of the members of the syndicate or partnership should now be a matter of account and adjustment in connection with the $10,000 note. In April, 1909, the complainant commenced two suits in the supreme court of Maine against John D. Yermeule, one suit to recover five-twelfths of the amount for which complainant was liable on the notes secured by three of said five mortgages, the Daniel Weare mortgage for $3,000, the Phillips mortgage for $2,000 and the Parsons mortgage for $3,300, being $8,300 in all, and another suit to recover one-third of the amount of complainant’s liability on the other two mortgages} the Daniel Weare mortgage for $9,000 and the Bowden mortgage for $.2,400, $11,400 in all. In September, 1909, defendant John D. Yermeule brought a suit in the supreme court of Maine against the complainant to recover the entire amount of three of the notes given by the complainant on three of these purchases of land— the Bowden note for $2,400 and the Daniel Weare note for $3,-000 and the Parsons note for $3,300, which notes were, as he claims, endorsed and delivered to him by the payees, respectively. And in the same month, September, 1909, complainant also brought a suit in the supreme court of Maine against the York Cliffs Improvement Company to recover from it the entire amount of its assumption on all the five mortgages, $19,700. All of these suits were pending and undetermined at the time of the further hearing in this cause.

No suits of any kind, other than the present suit, appear to have been brought, either in Maine or elsewhere, against Joseph N. Bhnney, the other defendant named in the original bill in the present suit, or against his executors who were substituted as defendants in 1907, after Kinney’s death, on an amendment to the bill. Neither Kinney nor his executors have- appeared in the suit, and on an order of publication against his executors a decree pro confesso was taken against them, before the final hearing.

The questions argued at the hearing were substantially these:

First. The nature of the relation between the parties in reference to the lands in question, and whether or not it was that of partnership or joint adventure in connection with the same.

Second. Whether complainant is entitled to an accounting in this court for the purpose of adjusting and settling the accounts of the partnership or joint adventure, including his liability on or payment into court of the judgment obtained against him.

Although the bill is, undoubtedly, framed solely on the theory of a partnership, and this is the only relationship expressly alleged, and the complainant himself throughout all his evidence gives, or attempts to give, all the transactions between them the color and usually the name of partnership transactions, counsel at the hearing claim the right to an accounting on this bill, even if it should be held that the relation between the parties is that of joint adventure rather than that of a technical partnership. There is a well-settled distinction made by our courts between the two classes of cases, and in many respects the distinction is vital, but in reference to the special question now ultimately involved, viz., that of a right to an account in equity, our courts hold that joint adventurers are entitled to such account, and on that basis, accounts as between joint adventurers or joint owners have been ordered on bills alleging the existence of partnership, and apparently based on this claim alone. Warwick v. Stockton (Vice-Chancellor Pitney, 1896), 55 N. J. Eq. (10 Dick.) 61; Jackson v. Hooper (Vice-Chancellor Howell, 1909), 76 N. J. Eq. (6 Buch.) 185, both approved on this point-in Braddock v. Hinchman (Court of Errors and, Appeals, 1911), 78 N. J. Eq. (8 Buch.) 270. In these cases, however, the bills seem to have set out specifically the transactions, or many of them, as to which the existence of a partnership was claimed, and the bills prayed general relief. This is the case with the allegations and prayer of the present bill. I think it is clear from the evidence that no partnership inter sese, in the legal or technical sense as defined by our courts, existed between the parties, but it is also clear that there was originally a joint adventure, in which they were interested, and on this basis of complainant’s right to relief under the bill, I will consider the evidence to determine the nature of this joint adventure, its continuance and whether complainant’s right to an accounting of the same against the defendant is made out. Complainant and defendant are the only two witnesses produced to give oral evidenc-e as to the agreement between them, which complainant now always describes or refers to as a partnership, and which relation the defendant, denies. There exists, however, a great mass of written evidence, extending through nearly ten years, consisting of the contracts, letters, statements, accounts and other documents, relating to their transactions, as well as the books and accounts of the two Maine companies, which took over or held all the properties in which these parties were jointly ‘interested, and a careful examination and consideration of these documents in connection with the conduct of the parties will solve these .questions of fact at issue almost, I think, to the point of demonstration.

(Here follows a statement of the evidence in detail which is omitted by the direction of the vice-chancellor.)

Upon the whole evidence, I conclude that there is no foundation for the claim upon which the bill is based. The evidence shows that no property or assets of any kind have been owned jointly by these parties since the conveyance of the "syndicate” property and the division of the syndicate assets; that all of the transactions in which the parties joined after this time related to advances to the company by the parties individually, and their repayment by the company, and every one of these transactions, except the note on which judgment was obtained against the complainant, was adjusted and settled between the parties at or about the time they were entered into, by making them in their legal form transactions between the separate members and the company directly; that this guaranteed note thus excepted, provided bjr its mitten endorsements and guarantees for the independent settlement under it, of the respective obligations of the parties to each other; that the ownership or control of the improvement company’s stock or property, as partnership or joint adventure assets, or as incidental thereto, is not proved, and would be invalid for that purpose, if proved, under the decision in Jackson v. Hooper, 76 N. J. Eq. (6 Buch.) 185; that there are no obligations incurred by or on behalf of the syndicate or any of its members, or in relation to its former properties now outstanding, except complainant’s personal obligations for purchase-money on the purchase of the properties, which obligations were assumed by tbe company; that as to these, defendant Kinney, on his written purchase of an interest in the lands, never assumed any obligation and is under no obligation to account to complainant, and that defendant Vermeule’s liability arises from his sole separate and individual written contract relating to his liability, and is not the subject of this suit for partnership or joint adventure accounting. This liability of the defendant Vermeule is now the subject of litigation in complainant’s suit against de Cendant, brought in the most appropriate tribunals, the courts of the state where the contract was made and the lands located, and whose laws must control the question of liability.

The evidence further shows that the two $5,000 notes sued on in the court of law were separate individual' transactions between. complainant and defendant Vermeule, in which Kinney had no part, and they are not the subject of any partnership or joint adventure accounts. In reference to either of the three notes, therefore, complainant has not shown any right to an equitable accounting, and the rights of the complainant and defendant J. D. Vermeule in reference to these notes, being as between each other altogether of a legal character, the bill must be dismissed, and defendant may apply for payment to him of the amount paid into court upon his judgment.


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    Munn & Company v. Americana Company et al.
    [Decided January 12th, 1914.]
    1. A contract gave defendant company the right to use the name of the “Scientific American Compiling Department” in the sale of defendant’s encyclopedia, and by way of compensation required that each subscriber to the encyclopedia should be a subscriber to one of complainant’s papers in order to receive the encyclopedia at the special price, and provided that a year’s subscription to the paper was to be a part of the contract with each subscriber, defendant’s part of such subscription to be $2, which was a reduction of one-third from the regular subscription price, the same to be paid to complainant in advance at the time the subscription began. The contract further provided that the agreement was to continue a year from March 1st, 1905, during which time defendant guaranteed a minimum of ten thousand yearly subscriptions, to the Scientific American or Scientific American Building Monthly, and to be renewed if mutually satisfactory.—Held, that such contract of guaranty was not a contract for the sale of ten thousand copies of the paper, so that, on breach thereof, the measure of damages would depend on the profit or loss by reason of not supplying the minimum number at the reduced price, but was a contract of guaranty incident to a contract for an account to be made as compensation for the reduction in price of complainant’s paper and the use of its name, and the guaranty fixed the minimum amount to be due yearly on the accounting.
    2. Defendant’s contract to furnish a minimum of ten thousand annual subscriptions for one of complainant’s papers at a specified price contemplated a running account, requiring a yearly demand for settlement for any deficiency in order to entitle complainant to recover interest on the loss sustained by any annual default, and a failure to demand interest at any time during an informal continuance of the contract barred the addition of such liability to that expressed in the contract under which the parties continued to act, and which did not provide for interest.
    On further hearing on application for decree for account.

      Mr. Franklin W. Fort, for the complainants.

      Messrs. McOarter & English and Mr. McKenna, for the defendants.
   Emery, V. C.

At the hearing upon the decree for account, I concluded (for reasons given in a memorandum) that complainant was entitled to an account in this court for the amount due under the contract of 1904, but were not entitled to an account in this court, either for profits derived from the use of the name-“Scientific American” or for loss or damage sustained by its wrongful use, these being purely claims for unliquidated damages.

On this further hearing to settle the decree for account under the contract, complainants waive any account for any amount due beyond the minimum sum of $20,000 per year, which they claim to be due under the contract, from which yearly sum is to be deducted the amounts already paid. On this waiver they ask no.w final decree for the deficiency in the yearly payments, with interest, without reference to a master. Defendants claim that the contract does not guarantee or agree to pay any specified sum yearly, and that their only liability to complainants under the contract is for the loss or damage sustained by their breach of the contract guaranteeing ten thousand yearly subscribers, and as to this claim, they insist that if it is not altogether a claim for unliquidated damages, and therefore not within the jurisdiction of the court, it must in any event be a matter for inquiry upon an accounting, and that no decree can now be ■ directed for the payment of any certain or guaranteed sum under the contract. If complainant's claim, that tire minimum' sum of $20,000 is payable yearly, is well founded, and all further accounting is expressly waived, then a final decree for the payment of the minimum sum which is in all events payable, may be now directed to be made as the full amount due on an account taken under the bill.

The decision of the question, whether there is a minimum yearly sum payable, depends altogether upon the legal construction of the contract of 1904. This contract, which gave to the Americana Company the exclusive right to the use of the name of the “Scientific American Compiling Department” during its continuance, required, by way of complainant's compensation therefor, that each subscriber to the encyclopedia should be a subscriber to one of complainant's papers, in order to receive the encyclopedia at the special price, and as to the payment to complainants and the manner of securing it, it was provided:

“Third. A year’s subscription to the Scientific American Building Monthly is to be a part of the contract with each subscriber, and your part of such subscription to be $2, the same to be paid by us in advance at the time the said subscription beginsalso,
“Fourth. This agreement to begin March 1st, 1905, to continue to March 1st, 1906, during which period we guarantee a minimum of ten thousand yearly subscriptions to the Scientific American or the Scientific American Monthly, and to be renewed if mutually satisfactory.”

On May 12th, 1906, the contract was, by endorsement, formally extended for one year from March 1st, 1906, to, March 1st, 1907, to be renewed if mutually satisfactory, and thereafter was continued without any formal writing, but by mutual consent and co-operation, until June, 3911. The regular yearly subscription price for either of complainant’s publications was $3, and the general object of the contract was recited in its opening clause, viz., “Desiring to extend the subscription list of the Scientific American and also the sale of the Encyclopedia Americana.” These two clauses, i'hwd and fourth, construed together, make a contract by which the Americana Company’ agreed that they would deliver to complainants at least ten thousand subscriptions, during each year, for complainant’s papers, from subscribers to the Americana, and pay from time to time to complainants during the year the sum of $2 for each subscription as taken. These subscriptions to complainants’ papers thus to be delivered to complainants by the Americana Company, were contracts, not with the Americana Company, but contracts made directly between the subscriber and the complainant, and upon the delivery of each of these contracts of subscription by the Americana Company to the purchasers of the encyclopedia, complainant 'was entitled to receive $2, a reduction of $1 from the regular subscription price, made for the purpose of extending the subscription list of the Americana as well as the complainants’ papers. The present contract therefore, as between the parties, is not to be treated on the basis of an ordinary or simple agreement of the Americana Company -to purchase of complainant, or of complainants to sell or supply to the Americana Company, complainant’s papers to the extent of ten thousand, at the specified price of $2. On the breach of the purchaser of such ordinary agreement for purchase and sale, the rule of damages for not taking goods agreed to be taken, might apply, and under this rule, only the loss by reason of not receiving the minimum number of subscriptions or papers at the price fixed would be recoverable, in the absence of any other provision of the’contract as to damages. But this rule does not apply to a contract of this character under which, as it seems to me, the questions whether complainants would have made losses or profits by furnishing ten thousand papers at $2 each, and what sum it would have cost them to supply the minimum number, are not material. The reason is this. The contract was not intended to be a contract merely on the basis of the purchase by the Americana Company of the complainant of at least ten thousand subscriptions at a specified price, but was, on the complainant’s part, a contract to co-operate with the Americana Company for the mutual extension of their subscription lists, and for this purpose, the entire consideration given by complainant was (l)’the reduction of its regular subscription price to the extent of one-third in favor of the subscribers to the Americana, by which reduction, the complainant to that extent co-operated with the Americana Company in its plan of offering to proposed subscribers the inducement of a free gift of one year’s subscription to complainant’s paper: and (2) the exclusive use of the name “Scientific American Compiling Department” in the enterprise of selling the Americana in connection with the offer of free subscriptions to complainant’s paper. The execution of these agreements on complainant’s part as to consideration began at once upon the operation of the contract, and the Americana Company thus received, and continued to receive during the operation of the contract, all the considerations or benefits to which it -was entitled under the contract. The consideration or compensation which complainant was to receive for these two concessions on its part, becoming effective against it at once, was (1) the right to receive $2 in advance and from time to time as each subscription to the Americana was received, and the subscription to the complainant’s paper delivered in connection therewith, and (2) the guarantee that there should be at least ten thousand of such yearly subscriptions, in which complainant’s part was $2 each.

In a contract of this kind, the guaranteed minimum itself is in itself a measure of the compensation fixed by way of account between the parties for the reduction in price and the use of complainant’s name in the enterprise. On breach of the contract to pay in advance $2 for each subscription delivered, and an accounting for the amounts due on subscriptions actually taken, it would certainly be immaterial whether the complainant lost, or made money by agreeing to .furnish the paper for $2, nor could in such case any deduction from the $2 complainant was entitled to receive for each subscription be made for the expense of supplying the subscription. The payment of the full $2 without deduction, as complainants’ part of each subscription taken to the Americana, applied as well to subscriptions in excess of ten thousand as to those under it, and certainly complainant’s recovery on a claim for accounting for money received as its share, beyond the ten thousand subscriptions, would not be determined by reference to its profit or loss by reason of the price of the paper being fixed at $2, or be reduced by reason of the expense or cost of supplying the excess number. The agreement for a minimum number of subscriptions fixed, as it seems to me, in the same way and on the same kind of basis, the minimum sum complainant was to receive on an accounting, by way of compensation for the considerations and benefits at once received by the Americana Company, as soon as co-operation under the contract began. In other words, the contract, of guarantee was a contract made as incident to and in connection with a contract for an accounting for definite sums received and as part of a contract for such accounting, and was made for the purpose of fixing a minimum limit on accounting. It was not an independent and separate contract by way of purchase and sale or supply of the minimum number of subscriptions. If this part of the entire contract be not treated on this basis of a contract to account, but as an independent contract of sale or supply, for breach of which damages are recoverable, then for breach of the contract to furnish at least ten thousand subscriptions at $2, the damages to complainants would include, as it seems to me, damages by reason of furnishing at $2 instead of $3, the regular price, all the subscriptions for which defendants have actually accounted. This would seem to be logically a loss incurred by reason of complainants’ reduction of the regular price, in reliance on the agreement to furnish a minimum number, and a loss resulting from defendants’ breach thereof. Manifestly such subsequent additional payment for subscriptions already furnished was not contemplated, as the result of a breach of the accompanying contract for a minimum number, and solely, I think, because the guarantee was intended as a guarantee to account for such minimum number, as part of the entire contract to account, made to compensate complainants for the consideration given b}r them to the defendants by way of reduction in price and use of their name.

Complainant waiving on this application for a decree for accounting, any claim to recover beyond the $2 for the minimum number of subscriptions guaranteed, is entitled to a decree that the amount due on the accounting is the amount of the yearly deficiency, and for payment of such sum. Interest, however, cannot be allowed. The minimum contract for a yearly number was a running account- of a kind which required a yearly demand for a settlement of the deficiency, if it was intended that interest should be claimed. The contract was renewed from 1907 until 1911, without any express formal agreement and only by the mutual action of the parties. Where the promise to pay interest is implied only and not express, facts sufficient to support the implication must be shown. 16 Am. & Eng. Encycl. L. (2d ed.) 1006. The failure to demand interest at any time during this informal continuance of the contract, prevents the addition of this liability to' that expressed in the contract itself, under which they continued to act, and which did not provide for it, either originally or in the single written extension.


author: Stevens, Y. C.

text:
    William F. Mullin v. Emma L. Vogt et al.
    [Decided January 19th, 1914.]
    1. Contemporaneously with the execution of a written lease by the defendant to the complainant, there was also executed a written agreement by the terms of which the landlord, defendant, agreed to convey to the complainant, lessee, at the expiration of the lease, or prior thereto, on request, the property so leased, by deed of warranty free from all exrcumbrance. The landlord, defendant, was unable to perform this contract because the premises are subject to an easement or right of way, and on being requested by the complainant, lessee, to make the conveyance in the way bargained fox, refused, stating that she could only deliver a deed that woixld except ttíe right of way.—Seld, that this refusal did not terminate the lease.
    2. The natural effect of calling upon the landlord, defendant, to fulfill her agreement to give title free from encumbrance, in case she declares her inability to do so because of the existence of the easement, is to relieve complainant, lessee, from any obligation on his part to perform it. If it is to have any further effect, ,it can only be because of some explicit provision on the subject and such provision is wanting.

      Mr. Ralph B. hum, for the complainant.

      Mr. Joseph KaJirs, for the defendant.
   Stevens, Y. C.

This is a bill asking for an injunction to restrain an action at law to recover rent payable on a written lease. The eomplainant admits that he has no defence to make in the law court, but he says that contemporaneously with the execution of the lease there was executed a written agreement by the terms of which his landlord, Mrs. Yogt, agreed to convey to him at the expiration of the lease, or prior thereto, on request, the property so leased, by deed of warranty free from all encum- ■ brance. He says further that Mrs. Vogt is unable to perform this contract because the premises are subject to an easement or right of way appurtenant to property contiguous therein, and that she, on being requested by complainant to make the conveyance in the way bargained for, refused, stating that she could only deliver a deed that would except the right of way.

The contention is that this refusal has not only terminated the agreement, but the lease as well. Why it has ended the lease is not obvious. The lease and agreement, though executed at. the same time, are contained in distinct instruments. They refer indeed to each other, but they axe not made interdependent. The lease is complete in itself. It specifies its duration (five years) and liow and when the rent shall be paid. It does not provide that it shall terminate or that the rent shall cease in case the agreement of sale comes or is brought to an end. To interpolate such a provision, on the ground of the intention of the parties, would be to do the very thing the complainant is objecting to, in the case of the agreement itself. The natural effect of calling upon Mrs. Vogt to fulfill her agreement to give a title free from encumbrance is, in case she declares her inability to do so because of the existence of the easement, to relieve complainant from any obligation on his part to perform it. If is it to have any further effect it can only be because of some explicit provision on the subject, and such provision is wanting.

The case of Croome v. Lediard, 2 Myl. & K. 251, commented on in Bug. V. & P. *163, is very much in point. By a written agreement, between plaintiff and defendant the plaintiff agreed to sell to defendant property L., and by the same agreement defendant agreed to sell to plaintiff property H.; both to be valued by the same person and both purchases to be completed on the same day. It was not expressed that the two contracts were to be dependent on each other. It was held that plaintiff was entitled to a specific performance of the contract as to property L., although defendant was unable to make a good title to property H. and parol evidence to show that in reality an exchange was intended was rejected. The lord-chancellor said: “If the agreement between the parties was in part conducted upon the basis of an exchange, why was the instrument so drawn as to suppress the real nature of the transaction?” So here with greater force may it be asked, Why, if the lease was to terminate because of the inability of the landlord to give the title she had agreed to give, was it not expressly so provided.?

I think the rule to show cause should be discharged.


author: Stevens, V. C.

text:
    Emma L. Vogt et al. v. William F. Mullin.
    [Decided January 19th, 1914.]
    1. An executory written agreement to convey land by deed of warranty free from all encumbrances, cannot be reformed on the ground of mutual mistake, and then enforced, on demurrer to a bill for specific performance stating- that the land is subject to a right of way and then charging that through mutual mistake there was an omission to mention in the writing that it was so burdened.
    2. Wirtts v. Guthrie, 81 N. J. Bq. (11 Buck.) 271, followed.
    3. The circumstance that the purchaser took a five years’ lease contemporaneously with the agreement of purchase and made an entry under the lease does not amount to a part performance, the lease and agreement of purchaser not being interdependent.

      Mr. Joseph Kahrs, for the complainants.

      Mr. Ralph E. Lum, for the defendant.
   Stevens, V. C.

This is a demurrer to a bill for specific performance. The bill alleges a written agreement to convey land in Newark by deed of warranty free from all encumbrance. It states that this land is subject to a right of way and then it charges that through mutual mistake there was an omission to mention in the writing that it was so burdened. The prayer is for reformation and for performance of the agreement as reformed.

Unless I undertake to overrule the case of Wirtz v. Guthrie, 81 N. J. Eq. (11 Buch.) 271, I must sustain the demurrer. Vice-Chancellor Emery there holds that an executory agreement in writing relating to land cannot be reformed on the ground of mutual mistake, and then enforced. In the leading case of Woollam v. Hearn, 7 Ves. 211, Sir William Grant shortly gives the reason: “This (parol) * evidence is offered, not for the purpose of resisting, but of obtaining a decree, first to falsify the written agreement and then to substitute in its place a parol agreement to be executed by this court.” The American editors of Leading Gases in Equity, in a note to this ease, say—vol. 2 p. 684 (3d Am. ed.) :

“As the statute of frauds expressly provides against the creation of any estate or interest in land without writing, it necessarily follows that if a party who is seeking to obtain a specific performance of such a contract gives parol evidence to prove that the contract is vitiated by fraud or mistake, he necessarily destroys his own case, for the evidence shows that the contract as it stands is not the true one and that the real contract is invalid.”

The opposite view of Story and Pomeroy is rejected by the vice-chancellor. The case in which he applied the rule is, I think, an extreme one. There the contract as written provided for the sale of two lots for $72,000. The real agreement was for three lots, one having been omitted by the draftsman through inadvertence. By his amended bill, the complainant set out the mistake and offered to convey all three lots for the price named. This offered a strong case foT relief, and all the stronger because if he had set out the agreement as written and prayed specific performance of it, and, on the defendant's setting up the omitted provision, had submitted to perform that provision as well, he would, according to the English cases, have been entitled to relief. The reason is evident. It is the plaintiff who, in such a case, asks that the agreement as written be performed. The defendant says, it is inequitable to require me to perform because the writing does not express the real agreement I made. I was to have something more. The plaintiff replies “if that is your objection I will give you what you ask.” It is obvious that in this situation the defendant is no longer in a position to resist performance on his part of the agreement as written, for his only ground of complaint, viz., the inequity of compelling performance is removed. Indeed the lord-justices, in Martin v. Pycroft, 2 De G. M. & G. 785, allowed the complainant to state the whole case in the first instance, and then gave relief.

But the case in hand does not contain the equity that inhered in the plaintiff’s position in 1 Wirtz v. Guthrie. Here complainant cannot by anj7 concession satisfy defendant. He agreed to give'an unencumbered lot and he can only give one that is subject to an easement. He is asking defendant to take less than he bargained for, at the same price. He can only compel him to take less by obtaining an alteration of the agreement as written. The agreement "that he would enforce must be made out in part by parol and this the statute forbids./ Manser v. Back, 6 Hare 443 Such, at all events, is the rule laid down by Vice-Chancellor Emery, and if it is to be changed it must be by our court of last resort.

But the complainant attempts to show part performance. He alleges that the purchaser took a five j7ears' lease contemporaneously with the agreement of purchase and he alleges an entry under the lease. I have in the case of Mullin v. Vogt, just decided, stated that in my view the two papers are distinct. Not being interdependent, part performance of the' lease is not part performance of the agreement. Even if they could be taken as one, there would have to be shown not only part performance of their written terms and stipulations but also part performance of the parol agreement. No such part performance is shown. There is nothing in the lease that requires the landlord to give a term that shall be freed from the easement.

I think that the agreement of sale is wholly executory and that it is subject to the rule of Wirtz v. Guthrie, supra.