author: Howell, Y. C.

text:
    William N. Crane v. Charles P. Gurnee.
    [Submitted October 27th, 1908.
    Decided November 4th, 1908.]
    1. Attorneys and solicitors are officers of the court, and the court may deal summarily with breaches of duty and privilege on their part; but, the relation between a party and the opposite party’s solicitors not being that of solicitor and client, a controversy between them would not justify the exercise of the summary jurisdiction.
    2. It is established practice in settling pending suits for parties to agree upon the taxable costs without a taxation by the clerk, and the court should always support the settlements, unless they are affirmatively shown to be unjust, oppressive, or illegal, or to have been induced by unfairness.

      3. One entitled to a taxation of costs may waive his right.
    4. Where complainant’s solicitors furnished the amount of their charges to defendant’s solicitor, upon negotiations to settle the suit, and offered to have their costs taxed by the clerk, and defendant’s solicitor did not accept the offer, but agreed that the amount should be paid by his client, the failure to accept the offer was a waiver of the right to have the costs taxed.
    On petition to fix solicitors’ fees and charges.

      Mr. William J. St. Lawrence, for the petition.

      Mr. Edward J. Luce, contra.

   Howell, Y. C.

The bill in this case was filed to foreclose a mortgage covering lands of the petitioner. The respondents are the complainant’s solicitors. When the suit had reached the stage of an order for substituted service of process on non-resident defendants, the petitioner made a sale of the mortgaged premises and sought to have the foreclosure suit ended. He directed his own solicitor to ascertain the amount of the fees and charges of the complainant’s solicitors. These were reported to him by the complainant’s solicitors to be the sum of $114.22. This included the total charge for taxable cost’s, fees for searches, and the counsel fees and expenses of the complainant. Petitioner’s counsel agreed that this amount should be paid by his client. He expressly waived his right to have the costs taxed. The arrears of interest on the mortgage were $167.98. Some days after the consummation of the sale of the land the purchaser paid to the complainant’s solicitors out of the purchase-money these two sums aggregating $282.20. After the payment had been made the petitioner conceived that the complainant’s solicitors’ charges were excessive and he sought to have some portion of the amount repaid to him by them. The solicitors declined to accede to his request, and this petition was then filed, appealing to the summary jurisdiction of the court over its solicitors and praying that the excessive charges might be awarded to him. The motion was heard on petition and. answering affidavits.

It well be observed that this is not a contest between the petitioner and his lawyer. The relation between the petitioner and the complainant's solicitors was not that of solicitor and client, and the summary proceeding which the court may exercise over its solicitors cannot apply to this controversy. The reason is obvious. Attorneys and solicitors are officers of the court; they are part and parcel of the equipment of the judicial system for the administration of justice. They have been specially admitted to their offices as persons qualified to transact the business of the public in the courts. They hold themselves out for engagements by clients, and the courts recognize their special privileges. The relations between them and their clients are those of trust and confidence, so much so that communications between solicitor and client are protected from disclosure and publicity and the strictest fidelity to their retainers must be observed. It is owing to this private and confidential relationship that the courts have undertaken to deal summarily with breaches of duty and privilege by solicitors. If the relationship were less close or lacked the element of confidence and trust in an officer of the court, the court would undoubtedly remit all cases between solicitor and client to the ordinary remedies by action at law. Lynde v. Lynde, 64 N. J. Eq. (19 Dick.) 736. Mr. Justice Dixon says, in Strong v. Mundy, 52 N. J. Eq. (7 Dick.) 834: “Attorneys and solicitors are officers of the court, and there is no doubt of the authority of the court to proceed summarily against them for their misconduct, but the behavior which will justify the exercise of this summary jurisdiction must be such as is dishonest or oppressive or clearly illegal. If it appears that there exists between a lawyer and his client a fair dispute, which can be decided only on the settlement of doubtful questions of fact or law, the court should not exercise its summary power, but should leave the parties to their ordinary remedies.” See Tate v. Field, 60 N. J. Eq. (15 Dick.) 42; In re Knapp, 85 N. Y. 284; In re Paschal, 10 Wall. 483; In re Dakin, 4 Hill 42; In re Kennedy, 120 Pa. St. 497; S. C., 14 Atl. Rep. 397; Koenig v. Harned, 13 All. Rep. 236. It is, therefore, quite evident that the summary proceeding which has been adopted in this ease- does not apply, but inasmuch as the respondents have not urged this defence, I will disregard it and will discuss the case on its merits.

It is inveterate practice in this state in the settlement of pending suits for parties to estimate and agree upon the amount of taxable costs without the trouble and expense, small though it be, of having a regular taxation by the clerk; and hardly a solicitor can be found who has not had such experiences. It is not only sanctioned by inveterate usage, but it is favored by the courts in order that parties may speedily settle their controversies out of court and without all the formalities that might be lawfully insisted upon.

The court should always support these settlements unless they are affirmatively shown to be unjust, oppressive or illegal, or that the settlement was induced by pressure or other unfair means. The following authorities—controversies between solicitor and client—support this position. In re Whitcombe, 8 Beav. 140, Lord Langdale, master of rolls, sustained the principle that an agreement by a solicitor to take a gross sum from his client in lieu of costs was not void, but that on account of the peculiar relation which exists between solicitor and client the court would regard all such adjustments with jealousy. In Stedman v. Collett, 17 Beav. 608, Sir John Romilly, Master of Rolls, sustained a settlement of a solicitor’s bill by the client for an estimated fixed sum and refused to disturb it, for the reason that it had been entered into fairly and with proper knowledge on both sides.

In Morgan v. Higgins, 1 Giff. 270, Sir John Stuart, vice-chancellor, set aside a mortgage which had been given by a client to his solicitor to secure—first, a gross sum agreed to be paid for professional services, and second., an amount claimed to be due on the settlement of accounts, for the reason that the evidence showed that the client from his situation as to ill health was unable to take an active part in managing his own affairs, and there was no evidence on the part of the solicitor of any proper statement or examination of the accounts. There the mortgage was held to stand as security only for what should be found to be justly due on a taxation of the bills of costs and on account of all the dealings and transactions between them. The fact that these cases are instances of controversies between solicitor and client make strongly in favor of the rule as between strangers or adversaries.

These cases were decided since the English statutes relating to solicitors’ compensation, but an examination of them will show that the points decided were not controlled by the statute. The relation between the solicitors of the complainant and the petitioner is not that relation of trust and confidence which necessarily exists so obviously between solicitor and client. Here the parties dealt with each other at arm’s length. The complainant’s solicitors owed no special duty to the petitioner, nor is he entitled to look to them for advice or protection. Besides, I do not find that the charges made by the complainant’s solicitors are excessive. They estimated their taxable costs at $89.22. On the argument they furnished me with a taxation made by themselves, which I have examined and which appears to be correct: it amounts to $86.80. The difference is too small to be the subject-matter of a litigation in this court. The other charges are charges for which the complainant’s solicitors are not in any way responsible. They are charges for which the complainant himself is answerable, if anyone is. Again, there is no doubt but that one entitled to a taxation of costs may waive his right. Hinckley v. Boardman, 3 Cai. 134. It appears to be the testimony in this case that when the complainant’s solicitors furnished the amount of their charges to the petitioner’s solicitor they offered to have their costs taxed by the clerk. This offer was not accepted by the petitioner’s solicitor, and his failure to so accept it was a waiver of his right to have the costs taxed.

I must therefore hold that the petitioner has no occasion to proceed against the respondents, and that the petition must be dismissed.


source: Caselaw Access Project

author: Howell, V. C.

license: Public Domain

text:
    Jacob L. Krah v. John Wassmer et al.
    [Decided November 11th, 1908.]
    1. A contract to convey lands can be specifically enforced, though it is signed by the vendor only, where the purchaser has paid all the price to be paid in cash, and has entered into possession.
    2. A unilateral contract to convey land ceases to be unilateral on the purchaser filing a bill for specific performance thereof.
    3. On a bill for specific performance, defendant cannot admit that there was a contract, and then set out a materially ’different contract from the one alleged in the bill, making the one so set out binding upon complainant, though the parties are bound by the statements in the answer in so far as they are admissions, or admissions without substantial variation from the bill; and, where defendant admits a substituted contract, complainant can have specific performance thereof, if he chooses to perform it on his part.
    4. A bill to specifically enforce an oral contract to convey land will be dismissed, where the terms of the contract are uncertain.
    5. Pure mistake of fact will sometimes defeat specific performance.
    6. One cannot defeat specific performance of a contract because of the omission of terms therefrom resulting from his own negligence.
    7. That tÉe purchaser has completed his part of a contract for conveyance of land, and gone into possession, entitles him to specific performance, whether it be under an oral or written contract.
    8. If the purchaser under a contract to convey lands, suing for specific performance, is compelled to stand upon an oral contract, he can refer to a receipt for part of the purchase-money to show the terms oE the contract.
    9. Complainant, having bargained for land understanding that he was to receive title free of encumbrances, can insist upon a conveyance free of restrictive covenants.
    10. Evidence held to entitle the purchaser, under a contract to convey land, to specific performance.
    11. One taking a decree of specific performance of a contract to convey land must take title subject to the vendor’s wife’s right of dower, unless she voluntarily releases it, since the court of chancery can only compel a wife to release her right in the manner prescribed by statute or in a case of clear fraud.

      12. In a suit to specifically enforce a contract to convey land, a deed, properly executed and acknowledged by the vendor and his wife, is evidence of her willingness to relinquish her dower. x
    13. Where, in a -suit to specifically enforce a contract to convey land, it appears that the vendor and his wife have executed and acknowledged a deed to complainant and his wife, the court can decree a delivery of such deed, if complainant will accept it, thus avoiding the necessity of complainant taking title subject to the wife’s dower right.
    14. If one suing to specifically enforce a contract to convey land would exercise an option to take a deed already made to him and his wife by the vendor and his wife, his wife should be a party complainant, and the bill should allege the execution of the deed and pray for its delivery.
    15. A bill to specifically enforce a contract signed by one defendant to convey land held by another defendant should show such situation.
    10. Complainant, in a suit to specifically enforce a contract to convey land, having been in possession since a certain date, should show that fact in his bill.
    On final hearing bn bill, answer, replication and proofs.

      Mr. Janes McDermit, for the complainant.

      Mr. Frank F. Bradner and Mr. Frank Voigt, for the defendants.
   Howell, V. C.

The bill in this case is filed against Wassmer and Radcliffe to compel the specific performance of an alleged contract to convey lands. The so-called contract, a copy of which is given below, was signed by Wassmer, although the title to the lands in question was in Radcliffe. It was testified at the hearing that Wassmer and Radcliffe had some sort of a joint interest in a number of lots of land of which the one in question was one, although their titles were separate and distinct, and that Wassmer had authority from Radcliffe to make the contract in question. The bill does not state whether the agreement was in writing or not. The answer alleges that it was oral, and it sets out what the defendants claim the contract was. The difference between the two consists in this: the defendants, who are the vendors, claim that it was agreed that the land should be conveyed with certain covenants restricting its use; the complainant, who is the vendee, claims that there was no such agreement.

The agreement between the parties was made in September, 1907, at which time the vendee paid $50 on account of the purchase-money and took a receipt therefor which has been destroyed. On October 3d, 1907, he paid $750 more, -making $800 up to that time, and some time prior to October 19th, 1907, he paid the further sum of $302, these three payments aggregating the total amount of the purchase-money that was to be paid in cash. The land was subject‘to a mortgage held by a building and loan association on which the vendors were liable as bondsmen. Some time between the first and last payment of the purchase-money installments the vendee executed a new bond and mortgage in his own name to take the place of the ones previously executed by the vendors and held by the building and loan association, these being steps preliminary to the taking of the title. At the time the vendee made the payment of the seven-hundred-and-fifty-dollar installment of the purchase-money he received a receipt for it of which the following is a copy:

'Tbvinqtow, N. J., Oct. 3d, 1907.
“Received from J. L. Krah the sum of eight hundred dollars on account of purchase price of Smith street property, purchase price to be thirty-five hundred and fifty dollars, two hundred and two dollars to be paid on or before Oct. 19th, 1907. The balance to be paid by said J.. L. Krah assuming and agreeing to pay a present Building and Loan mortgage now upon the above premises for twenty-five hundred and forty-eight dollars.
“John Wassmeb.”

On October 4th, 1907, the vendee, with the knowledge and consent of the vendors, took possession of the said premises and with his wife and family has actually resided thereon until this time. About the time the complainant entered into possession the defendant Radeliife and his wife executed in due form of law and properly acknowledged a deed of conveyance to the complainant and his wife for the lands in question, which deed did not contain the restrictive covenant that the vendors now insist upon.

The defendants claim that the receipt above set out is not a contract,* or, at least, if it is a contract, it belongs to that class which is known as unilateral contracts and is not specifically enforceable in equity. The law in relation to contracts of this class has received a great deal of judicial attention in this state. In Cramer v. Mooney, 69 N. J. Eq. (14 Dick.) 164, it was held that a contract for sale of lands, though signed only by the vendor, would not be held to be unilateral in a ease where the vendee had paid nine-tenths of the purchase-money and had tendered the balance thereof and had entered into possession of the lands. Vice-Chancellor Grey says: “The defendant has not only paid to the vendor complainant the gieater part of the purchase-money, but has actually entered into possession of the premises and tendered the balance of the agreed price and demanded a deed and the clearing of the title, and tire complainant has accepted him as a purchaser and tendered him a deed, and now files his bill to enforce payment. These acts of part performance are sufficient to' establish a contract between the complainant and defendant which would be enforced in equity even if entirely by parol.” Even if the case stood upon this so-called unilateral contract it ceased to be unilateral the very moment the vendee filed his bill for the specific performance of the contract. Richards v. Green, 23 N. J. Eq. (8 C. E. Gr.) 536. In that case Chief-Justice Beasley, in the opinion in the court of errors and appeals, says: “But it will be observed that when such contracts come to be enforced in equity they cease to be unilateral, for upon filing the bill.the party who was before un-' bound puts himself under all the obligations of the contract. By.his own act he makes the contract mutual and the other party is enabled to enforce it. The consequence is that in every case that I can find where specific performance has been ordered a mutual remedy existed upon it at the time of the rendering of the decree.” I must therefore hold that this objection is untenable.

The vendors next claim that inasmuch as the bill does not set out the fact that the agreement was in writing the vendee cannot have a decree because of the statute of frauds, the benefit of which the vendors claim, and that it was competent for the defendants, by an answer in such case to set up their version of the oral agreement, and that the agreement so set u¡5 without any evidence or proof of any nature is binding on the complainant. In Ashmore v. Evans, 11 N. J. Eq. (3 Stock.) 151, the bill alleged a parol contract which it prayed might be -specifically performed. The defendant denied the agreement alleged in the bill, but admitted an oral agreement which did not substantially differ from the one set out in the bill. The defendant failed to insist upon the benefit of the statute and the court held that the agreement was sufficiently admitted. It has been a constant practice to decree the specific performance of oral contracts to convey land in cases in which the contract in the bill is admitted or substantially admitted by the answer. The insistment of the vendors in this case, however, goes considerably beyond the ruling in any case that I have been able to find. They maintain that they may admit that there was a contract and that they may then set out a very different contract from the one alleged in the bill, and that such contract so sot out in the answer is binding upon the complainant and must be taken as the contract which was made between the parties. This statement hardly needs argument to show its fallacy. It would'permit a fraudulent defendant to impose upon the complainant any sort of contract that he might choose to put in his answer ánd would drive the complainant to an abandonment of his suit or compel him to submit to a possibly outrageous fraud. The parties are bound by statements made by the defendants in their answer in so far as they are admissions, or admissions without srrbstantial variation of the charges in the bill, and where the defendants admit a substituted contract the complainant is entitled to have a decree for the specific performance of the substituted contract if he chooses to perform it on his part and he can have such relief in his suit on the original contract. Ryno v. Darby, 20 N. J. Eq. (5 C. E. Gr.) 231. If, on the whole case, the terms of the oral contract are uncertain, the bill will be dismissed. Clow v. Taylor, 21 N. J. Eq. (12 C. E. Gr.) 418. The defendants’ contention on this point must also be rejected.

It is also urged that the defendants’ vendors intended that certain restrictions should be part and parcel of the contract, and that they were omitted from it and from the deed by mistake. Pure mistake of fact is sometimes a defence to a suit for specific performance. McCormick v. Stephany, 57 N. J. Eq. (12 Dick.) 267. But the circumstances of this case do not indicate that the vendors acted under any misapprehension of fact whatever. They rather show that if any term was omitted from the contract and from the deed it was the result of their own negligence and not of mistake, and it is well settled that this court will never relieve a party from the consequences of his own negligence. Cairo and Fulton Railroad Co. v. Titus, 27 N. J. Eq. (12 C. E. Cr.) 106; Phillips v. Pullen, 45 N. J. Eq. (18 Stew.) 6. This insistment of the vendors .must likewise fail.

I think that whether the complainant relies upon the receipt of October 3d, 1907, or upon an oral contract of the character which must be inferred from the bill, he has a valid contract which is enforceable in this court. The bill states the complainant’s idea of the contract, and it turns out that he has completed the contract which he has set out by payment of the full consideration and was thereupon let into possession at the time of the payment. This of itself would give the complainant a right to a decree for a deed in accordance with the contract that was proved, whether it be an oral contract or the written one of October 3d, 1907. If the complainant is compelled to stand upon the oral contract I think he may refer to the receipt for the purpose of showing what the terms of the oral bargain were.

It is insisted that Mrs. Krah, the wife of the complainant, had notice that the lands were restricted. This evidence consisted of three items. She saw an advertisement in a newspaper of the sale of the property in question which described it as being situate in a restricted section. There is a large painted sign at the head of the street on which the property is located which describes the neighborhood as a restricted neighborhood. The agent of the vendors told her that the property was restricted so that there could be no nuisance, no saloons, and that all houses were required to be built on the same street line. This was entirely oral; no one had any written document showing exactly what the restrictions were or were to be. The defendant Radcliflle who talked with the complainant never mentioned the restrictions at all, and it does not appear that the complainant ever had brought home to his knowledge the fact that any restrictions were intended to be inserted in the deed.

There is no positive proof in the case as to exactly what restrictions the defendants are insisting upon. The allegations of the bill in that behalf are not supported. The agent of the vendors was called and gave his evidence as is above stated. They also called a witness named Eclcer, who purchased a lot from the vendors and who testified that the restrictions were that the fronts of the houses should all be built on one line and that the houses should be three-story houses; that there should be no factories, saloons or breweries on the premises. If the court were satisfied that it was intended that the use of the land should be restricted, there is nothing in the case to indicate what restrictions were intended or were agreed upon.

I am therefore of opinion that when the complainant bargained for the premises in question, he did so with the idea that he was to receive the title to the property free and clear of all encumbrances, and that he is now entitled to insist upon a conveyance without the restrictions which the defendants are attempting to impose upon him. Lounsbury v. Locander, 25 N. J. Eq. (10 C. E. Gr.) 554. The ease does not differ in its essential features from Richards v. Green, 23 N. J. Eq. (8 C. E. Gr.) 536. In that case the complainant set forth two agreements, the first being oral, whereby the defendant Richards agreed to convey to the complainant Mr. Green a house and lot for $2,500, to be paid for as follows: $500- in cash, and the remainder secured by bond, with an accompanying mortgage covering the premises. The other agreement was an instrument in writing in favor of the wife of the complainant Green, which was signed by the defendant Richards alone. In that case the complainant was permitted to enter into possession of the premises; and the court examined into the oral agreement and into the written agrément for-the purpose of ascertaining what the terms of the actual agreement were. The complainant was given a decree for specific performance.

In this case, on the evidence, the complainant is entitled to a decree. Unless he can have relief in this court and in this suit, he will be in the anomalous position of having a right to the possession of the land, ancl of being in actual possession in pursuance of that right without any legally defensible or transmissible title. If, however, he takes a decree in accordance with the prayer of his bill he will be obliged to take the title subject to the inchoate right of dower of Mrs. Eadcliffe, unless she is willing voluntarily and gratis to release her interest, for this court has no authority to compel the wife to relinquish her right except in the manner pointed out by the statute, and except also in a case of clear fraud. Hawralty v. Warren, 18 N. J. Eq. (3 C. E. Gr.) 124; Peeler v. Levy, 26 N. J. Eq. (11 C. E. Gr.) 330.

It appears, as already stated, that a deed was executed by the defendants Eadcliffe and wife to the complainant and his wife. This deed was before the court at the hearing as an exhibit; it appeared to have been executed and properly acknowledged, not only by Eadcliffe, but by his wife also, which may be taken as evidence that she was willing to release her right. In Hulmes v. Thorpe, 5 N. J. Eq. (1 Halst.) 415, a similar situation was developed, concerning which the chancellor said: “It may be that the wife’s acknowledgment of the deed in this case should be considered as equivalent to her express consent to execute it, and that on this ground the court would be justified in making a decree that Thorpe deliver a deed executed by him and his wife, but it would be safer for the court to decree the delivery of the deed already executed by her, and perhaps it would be safer for the complainant.” I will follow that course in this case. If the complainant will accept the deed already executed to himself and his wife, a decree will be made that such identical deed be delivered.

If he will not accept this deed he may have a decree for specific performance against Eadcliffe ■ alone.

While the complainant is entitled to the relief above indicated upon the evidence, it ought not to be adjudged to him on the present state of the pleadings. I find the following defects in them which must be remedied—first, the bill is filed by Mr. ICrah alone. If he intends to take advantage of the option to accept the deed made to himself and bis wife, the bill should be amended by adding the wife as a party complainant, alleging the execution of the identical deed in question and praying that it should lie delivered; second, it appears that the title to the premises is in Mr. Baclcliffe alone, and not in Wassmer, that the contract is signed by Wassmer and not by Baclcliffe. There should be a proper allegation of these facts and a corresponding amendment to the prayer; third, it appears that the complainant has been in possession of the property since October 4th, 1907. There is no allegation of this most important fact in the bill, and it should be amended accordingly. Counsel may find on closer examination that the bill may need amendment in other particulars. On account of these glaring defects in the bill, and the complainant’s almost entire misconception of his cause of action, I think that the defendants were justified in answering, and that it would not be equitable to compel them to pay costs. The decree will therefore be without costs against either party.


text:
    Frank F. Weber v. Edwin C. Nichols et al.
    [Submitted December 1st, 1908.
    Decided December 9th, 1908.]
    1. Upon a bill filed by a stockholder, not only on his own behalf but also on behalf of all the stockholders of an insolvent corporation who are situated similarly to himself, after its affairs had been wound up by a receiver, against the receiver and.the other stockholders, for the purpose of having the court declare the equities of the shareholders among themselves with respect to the surplus remaining in the receiver’s hands admittedly belonging to the shareholders, the defendants having moved under rule 213 to strike out the bill for the following (amongst other) reasons: (1) Because the relief prayed for cannot be awarded in a suit brought by a stockholder; (2) because there is no allegation that the receiver was requested to bring the suit, nor of his refusal to do so; (3) for want of equity.—Held, that the bill is good, because the complainant is not attempting to enforce a cause of action which runs to the corporation, but one which affects onlj' the stockholders as between themselves.

      2. The bill in this case must be treated as one the object of which is to provide for the distribution of the fund in the hands of the receiver, and it is no objection that no specific prayer to that end was appended to the bill, that appearing to be the purpose and object of the suit.
    3. The admission of fraud charged in the bill which is involved in the form of this motion to strike out disposes of the two remaining objections taken to the bill, the particulars of which objections are set forth in the opinion.
    4. If there was in fact the fraud which is alleged, the complainant is not estopped from objecting to the questioned transaction or from demanding the cancellation of shares issued in pursuance of it, nor does it involve a rescission of the questioned contract or a restoration of conditions, as' claimed in such remaining two objections comprised in the notice of the motion.
    On motion to strike out bill of complaint under rule 213.

      Mr. Ilalsey M. Barrett and Mr. Randolph C. Barrett, for the motion.

      Mr. Edward M. Colie and Mr. Jerome B. Qedney, contra.

   Howell, V. C.

The bill in this case is filed by the complainant not only on his own behalf, but on behalf of all the stockholders of the Zonite Manufacturing Company, who are situated similarly to himself, for the purpose of having this court declare the equities of the shareholders among themselves under the following circumstances. s

The company was organized under the General Corporation law on December 10th, 1904-, with a capital of $500,000 divided into> five thousand shares of the par value of $100'" each. On that day the defendants, Nichols, Taylor, Stewart, Hopkins and Heller became stockholders and directors; at this first meeting they voted to purchase from Nichols an undivided one-half interest in a United States patent and all the interests in two pending applications for United States patents covering methods of manufacture and distribution of sterilized air for refrigeration and other like purposes, together with any and all improvements that might be in the future devised or invented by Nichols, for which patents and applications all the capital stock was issued to him. He retained for himself and his immediate associates three thousand eight hundred and ninety-five shares, and transferred to the company, to be held as treasury stock, one thousand one hundred and five shares. This transaction was made the subject-matter of an agreement in- writing bearing date on the same day, a copy of which is annexed to the bill.

Of the treasury stock six hundred and thirty shares of the par value of $63,000 were sold by the company for cash at paito the complainant and other persons, the complainant being now the owner of twenty-nine shares thereof for which he paid the sum of $2,900 to the company in 1905 and 1906.

The company carried on its operations until October 22d, 19071. On that day it was adjudged to be an insolvent corporation and a receiver was appointed for its assets, who has wound up its affairs, paid its creditors in full and now has in hand a surplus of $14,000, which admittedly belongs to the shareholders.

The bill alleges that when the patents and applications for patents were transferred to- the company they were of little or nii value; that they were not worth the $500,000 which the company paid for them in stock; that the property was grossly overvalued by the directors for the purpose of committing a fraud on all persons who might subsequently become stockholders; that the transaction was intended as a mere gratuity to Nichols, and that the company did not purchase or receive from the said Nichols any property such as is required to- be received or purchased by the laws of this state under'which the corporation is organized as the basis of a legal issue of capital stock for property purchased.

The bill likewise alleges that three thousand eight hundred and ninety-five shares of the company’s stock which was originally reserved by Nichols was subsequently divided up by him among the directors above mentioned and other persons, all of whom are made parties defendant to the suit. The prayer for relief is that the defendants may be restrained from selling, pledging or transferring, or attempting so to do, any of the said shares, and from collecting or receiving any dividend upon the said shares upon a distribution of the estate of the said Zonite Manufacturing Company, and that the receiver, who is also a party, may bé directed by the order of this court not to make any distribution upon the estate of the company to the defendants on account of the shares of stock so illegally and fraudulently issued to them. There is likewise a prayer that these shares be canceled and the certificates evidencing them surrendered to the receiver for that purpose and that the defendants may be decreed to have no interest or right as stockholders in the said company.

The defendants now move, under rule 213, to strike out the said bill for the following reasons—first, because the relief prayed for cannot be awarded in a suit brought by a stockholder; second, because the complainant became a stockholder after the transaction of December 10th, 1904, and is therefore estopped from objecting to the Nichols contract and from applying for the cancellation of the shares of stock issued in pursuance of it; third, because there is no allegation that the receiver was requested to bring the suit, nor of his refusal to do so; fourth, because the relief prayed for involves the rescission of the Nichols contract without the ability to restore the former conditions; fifth, want of equity.

The first, third and fifth objections are disposed of by the case of Bacon v. Robertson, 18 How. 480. There certain stockholders of an insolvent bank, whose affairs were being wound up by a trustee, brought suit against the trustee and other stockholders to compel a distribution of the surplus remaining in the hands of the trustee after the payment of all the debts of the corporation. There was a demurrer to the bill which was sustained by the circuit court, but the judgment was overruled by the supreme court on appeal, and the bill was approved. As to the three objections above mentioned the bill is good and the reason is that the complainant stockholder is not attempting to enforce a cause of action which run’s to the corporation, but one which affects only the stockholders as between themselves. So long as no other stockholder joins him he is defending alone what he considers to be his individual and personal light against the claims of persons who he says have attempted to defraud him. Neither does this action by the complainant affect the rights of the receiver. While the receiver might institute some proceeding which would result in the litigation of- the 'questions now before the court, after all the real contention would be between the stockholders and they would be ranged as they are in this suit, and the receiver would stand as a mere stakeholder.

I think I must treat the bill in this case as one whose object is to provide for the distribution of the fund in the hands of the receiver. Objection was made at the argument that no specific prayer to that end was appended to the bill, but notwithstanding its absence I think that that appears to be the purpose and object of the suit. The statute, section 86 of the Corporation act of 1896, makes provision for the distribution by receivers of the assets of corporations which shall come to their hands. After the payment of debts and expenses what is left is called the “surplus funds;” these funds, after the payment of the creditors and the costs, expenses and allowances and the preferred stockholders, shall be divided and paid to the general stockholders proportionately according to their respective shares.

The incorporation papers have not been laid before the.court, presumably because they contain no reference to the manner of the distribution of the surplus; there appear to be no adjudications in our state which can be used as a guide.

I think the strength of this bill lies in the allegations of fraud. In the absence of that element, the statutory direction to divide the surplus among the general stockholders proportionately according to their respective shares would necessarily govern. In the scheme of the law qf corporations it is contemplated that all stockholders who belong to the same statutory class shall 'stand on an equality as to rights, privileges, duties and liabilities, and that between members of the same class there shall be no preferences.

On December 10th, 1904, when Nichols held three thousand eight hundred and ninety-five shares of the company’s stock and there were one thousand one hundred and five shares in the treasury, these individual shares stood on a par with each other and the situation was not changed when the company disposed of its so-called treasury stock. There was then no idea of calling upon Nichols and his immediate transferees to pay up anything further on their shares, and if the operations of the company had resulted in a profit it could hardly be claimed under tire circumstances that tire profits should have been distributed only among those shareholders who paid cash at par for their shares, omitting Nichols and his transferees. The situation is illustrated by the case of Birch v. Cropper (1889), 14 A. C. 525; 59 L. J. Ch. 122, decided under the provisions of section 133 of tire Companies act of 1862, which directs that after payment of the company’s liabilities the property shall be distributed amongst the members according to their rights and interests in the company, and that the liquidators should adjust the rights of the contributories amongst themselves. That was a case growing out of the construction of the Manchester Ship Canal. The" canal company had purchased the property of the Bridgewater canals, which subsequently went into liquidation. It had two kinds of stock. On tire common shares which were issued at the organization of the company only about one-third of the par value had been paid up, while the preferred shares which were issued some years later had been paid in full. After repayment to the shareholders, common and preferred, of the amounts which they had paid on their shares, there still remained about five hundred thousand pounds concerning the distribution of which the litigation took place. Mr. Justice North in the chancery division decreed that the distribution should be made in accordance with the amounts paid up. This was affirmed by the court of appeal, but reversed by the house of lords.

Lord MacNaghten, who delivered one of the opinions in the house of lords, says: “Then the preference shareholders (who had paid their shares up in full) say to the ordinary shareholders (who had not), ‘We have paid up the whole of the amount due on our shares; you have paid but a fraction on j'ours. The prosperity of a company results from its paid up capital; distribution must be in proportion to contribution. The surplus assets must be divided in proportion to the amounts paid up on the shares.’ That seems to me to be ignoring altogether the elementary principles applicable to joint stock companies of this description. I think it rather leads to confusion to speak of the assets which are the subject of this application as ‘surplus assets’ as if they were an accretion or addition to the capital of the company capable of being distinguished from it and open to different considerations. They are part and parcel of the property of the company, part and parcel of the joint stock or common fund which at the date of the winding up represented the capital of the company.” The same course was taken in the case, In re Weymouth, &c., Steam Packet Company (1891), 1 Ch. 66; 60 L. J. Ch. 93, and In re Hodges Distillery Co., L. R. 6 Ch. 51; 40 L. J. Ch. 21.

The situation, however, is varied by the allegations of fraud contained in the bill. These allegations must be taken to be true’ for the purpose of this motion, and the court must, therefore, assume that the basis of tire cause of action is an attempt to defraud the complainant and the other persons who became stockholders at the time Nichols received certificates for his shares. In Hayward v. Leeson, 176 Mass. 310, it was held that this particular variety of fraud avoided the transaction and rendered the fraud-doers liable to account for the profits made by them.

The admission of fraud charged in the bill, which is involved in the form of this motion, disposes of the two remaining objections taken to the bill. If there was in fact the fraud which is alleged the complainant is not estopped from objecting to1 the Nichols transaction or from demanding the cancellation of shares issued in pursuance of it, nor does it involve a rescission of the Nichols contract or a restoration of conditions. According to this view, Nichols gave nothing for his stock because his patents were worthless; hence no offer to restore is necessary, because there is nothing to restore.

The motion will therefore be denied.


author: TIowell, Y. C.

text:
    Michael Geyer v. John Geyer et al.
    [Decided December 25th, 1908.]
    1. The presumption that where a husband pays the purchase-money on a purchase of lands and has the conveyance made to the wife is that an advance or settlement was intended and that in such case no trust could result, is not rebutted by proof of declarations made by the wife to the effect that when she died her husband was to have her property, where it appeared that the wife carried out this idea by providing by her will that her husband should have a life estate in all her property, real and personal.
    2. Where the wife’s will gave the remainder of the estate to her son, who was sole executor of the will, and the son took an assignment of an outstanding judgment against his father, and after negotiations between the father and the son relative to the payment of the judgment, under an execution issued thereon, the son sold the life estate in the realty and took a sheriff’s deed therefor, thus giving the son the fee-simple title to the lands and depriving the father of his interest under the will, the transaction will be set aside.
    3. The fiduciary relation which exists between the parent and child will not permit a son to take such an unfair advantage of an aged father.
    4. The son being the remainderman and executor, and by implication trustee under the will, it became his duty to protect, in so far as he could, the life estate of his father.
    5. The son having acquired the fee-simple title applied for a loan on mortgage on the property in question to the mortgagee defendant M. M. committed the transaction of the business on her part to the solicitors who had acted as the solicitors of the son in his acquirement of his father’s life estate. There was no proof that M., the mortgagee, had any actual knowledge of the son’s fraud upon his father, but an attempt was made on the part of the complainant to charge her with notice of the transaction for the reason that the solicitors whom she employed knew about it.— Held, this is carrying the doctrine of notice to an agent to an extreme to which the decisions do not now go.
    6. The rule now is that the knowledge of the agent is chargeable upon his principal whenever the principal, if acting for himself, would have received notice of the matters known to the agent.
    7. If the mortgagee, M., had acted for herself in the transaction in question she would not have received notice of the matters which were known to the solicitors who acted for her, and therefore their knowledge, if any they had, was not imputable to her.

      8. Though the complainant, the father, had been in possession with the other members of his' family of the premises intended to be mortgaged, such possession would have been sufficient to charge the mortgagee with notice under the authority of Rankin y. Goar, J¡S N. J. Eg. (1 Dink.) 566.

    9. Such mortgage is a lien as between the mortgagee and the complainant upon the complainant’s life estate. As between the son and his father, the complainant, a different result would ensue, but the equities between them touching this mortgage lien cannot be worked out in this suit.
    10. For the reasons stated in the opinion the son should be required to account in this court for any personal property that passed under the will in order that the rights of the life tenant in all the personalty may be ascertained, and in such account this judgment must be awarded to him.
    On final hearing on bill, answer, replication tod proofs.

      Mr. Joseph A. Beecher, for the complainant.

      Mr. Samuel F. Leber, for the defendants.
   TIowell, Y. C.

In Read v. Huff, 40 N. J. Eq. (13 Stew.) 234, it was held by our court of errors and appeals that where a parent or husband pays the purchase-money on a purchase of lands and has the conveyance made to a wife or child, the presumption is that an advancement or settlement was intended, and that in such case no trust could result unless the presumption should be rebutted by proof. In this case the lands in question were purchased by the complainant with his own funds and title by his direction was made to his wife who is now 'dead. An attempt was made to rebut the presumption referred to, but in my opinion the proof is not sufficient for the purpose. It consists wholly of declarations made by the wife to the effect that when she died her husband was to have the property. I do not think this is sufficient under the circumstances of this case, for it appears, as is hereinafter more fully set out, that the wife carried out this idea by providing by her will that the husband should have a life estate in all her property, real and personal. Hence the complainant must fail on this branch of the case.

The wife left a will by which she devised to the complainant a life estate in all her realty and personalty—the same estate in the realty that he would have had if she had died intestate. The remainder of her estate was given to her son John, who was made the sole executor of the will. After this estate had vested in the life tenant John purchased a judgment which had been recovered many years ago against his father; execution had been issued on it and a levy taken on the life estate and the same had been advertised for sale. At or about the time that John took the assignment of the judgment there was some negotiation between him and his father about the payment of the amount due on the judgment, but the amount was never paid by the father. John then sold the life estate in the realty and bought it in for himself and took a sheriff’s deed therefor. This gave John the fee-simple title to'the lands and deprived the complainant of his interest under the will.

This transaction must be set aside. The fiduciary relation which exists between a parent and child will not permit a son to take such an unfair advantage of his aged father. The son was the remainderman; he was also executor of his mother’s will, and, by implication, trustee thereunder, and it became his duty to protect, in so far as he could, the life estate of his father. The father is about seventy years of age, the son in middle life. They lived together 'in the same homestead property until long after the death of the mother, and the purchase by the son of the father’s life estate when, according to the father’s statement, he was ejected by his son from his former home in which he claims the present life estate. All these facts point to the existence of a fiduciary relation in which the son was the fiduciary and the father the beneficiary. The son cannot, by-any means known to the law, make a profit out of his position, nor will he be permitted to dissipate or take to himself the property or interests which it is his lawful duty to preserve for his beneficiary, Huguenin v. Baseley, 14 Ves. 273; 2 W. & T. L. C. 597, and notes.

In the early part of 1908 John Geyer, having acquired the fee-simple title, applied to the defendant Mrs. Michaels for a loan of $800 on mortgage on the property in question, she committed the transaction of the business on her part to the solicitors who had acted as the solicitors of John Geyer in his acquirement of his father’s life estate. There is no proof that the mortgagee had any actual knowledge of the son’s fraud upon his father, but an attempt is made on the part of the complainant to charge her with notice of the transaction for the reason that the solicitors whom she employed knew about it. This is carrying the doctrine of notice to an agent to an extreme to which the decisions in our state do not now go. It may be that under the case of Willard v. Denise, 50 N. J. Eq. (5 Dick.) 482, the position might be maintained, but Willard v. Denise was overruled in the case of Vulcan Detinning Co. v. American Can Co., 67 Atl. Rep. 339, and the earlier doctrine announced in Sooy v. State, 41 N. J. Law (12 Vr.) 394, was re-established. The rule now is “the knowledge of the agent is chargeable upon his principal whenever the principal, if acting for himself, would have received notice of the matters known to the agent.” It is quite plain that if the mortgagee had acted for herself in the transaction she would not have received notice of the matters which were known to the solicitor who acted for her.

I must therefore declare that the knowledge of the solicitors, ii any they had, was not imputable to the mortgagee.

The time when the complainant was ejected from the premises in question does not appear, but even though he had been in possession with the other members of his family of the premises which were intended to be mortgaged, such possession would not have been sufficient to charge the mortgagee with notice, under the authority of Rankin v. Coar, 46 N. J. Eq. (1 Dick.) 566.

I must therefore hold that the mortgage is a lien as between the mortgagee and the complainant upon the complainant’s life estate. As between John Geyer and his father, the complainant, a different result would ensue, but the equities between John and his father touching this mortgage lien cannot be worked out in this suit.

A single question remains. It appears by the evidence that at the time the father was ejected from the premises by John, the father owned and had in his possession there considerable personal property, consisting of horses, wagons, carts and cows of the value of several hundred dollars. This was retained, so the complainant says, by his son John, and the complainant seeks to have a decree that John should account therefor, and also for certain moneys received by John, tlie proceeds of other property sold by him since the death of his mother. Inasmuch as John, the executor, has refrained from filing any inventory of the estate under the will of his mother, or to render any accounts whatever in the proper jurisdiction, he should be required to account here for any personal property that passed under the will in order that the rights of the life tenant in all the personalty may be ascertained. In the accounting the money paid by John for the judgment must be awarded to him.

It appears by the testimony that the horses, wagons, carts and cows which were left upon the place, and which were valued by the complainant at several hundred dollars, were his own property. These items, therefore, cannot be dealt with in this court. If -the property belonged to him, and was taken from him by his son John, the only way to recover it is by an action at law.


text:
    Emma V. Newbery v. Mary M. Barkalow et al.
    [Decided January 21st, 1909.]
    ' 1. A corporation authorized by its act of incorporation to purchase and sell land, and to require any grantee to make such improvements as might seem expedient, purchased land, laid out streets, and adopted a resolution fixing a building- line. It then conveyed a tract .subject to the restrictions in the act of incorporation, and bound the grantee and assigns not to violate the act of incorporation or regulations made by the corporation. The tract conveyed was subsequently divided into lots, and conveyed to different persons, subject to conditions and restrictions previously imposed by the corporation.—Held, that such persons were chargeable with notice of the building restrictions contained in the resolution of the corporation, though it appeared only in its complete form in the minute book of the corporation.
    2. The words "at any time” in a deed by a corporation authorized to purchase and sell lands subject to restrictions, which recites that the conveyance is subject to the restrictions in the act of incorporation, and that the grantee, his heirs, and assigns agree not to violate any of the provisions in the act of incorporation, “by-laws, rules or regulations made by the said” grantor “at any time” refer to the date of the violation, and not to the date of the adoption of the by-laws, rules or regulations.
    3. To authorize one to insist on restrictive covenants in deeds, and to , invoke the injunctive powers of the court to enforce them, the restrictive covenants must be clear and satisfactory.
    4. A corporation authorized to purchase and sell lands, and to require any grantee to make such improvements as might seem expedient to secure a uniform development, purchased land, laid out streets and avenues through it, the avenues running at right angles to the streets, and being twenty feet wider than' the streets. It adopted a resolution for a uniform building line “on the main avenues,” and conveyed tracts subject to restrictions contained in rules of the corporation, which the grantee agreed not to violate.—Held, that the restrictive covenant applied not to the streets at all, but applied to each and all of the avenues; the word “main” in the quoted phrase being surplusage.
    3. Where an owner of land laid it out into streets and blocks, and "by restrictive covenants in the deeds fixed a building line, the fact that a purchaser violated the restriction by the construction of hn open piazza which extended into the restricted area, but did not obstruct the view from adjacent property, did not prevent him from enforcing the restrictions against the adjacent owner; the purchaser’s violation being- immaterial.
    6. Where an owner of land laid it out into streets and blocks, and by restrictive covenants in deeds to purchasers fixed a building line, the court, in a suit to restrain specific violations of the covenant, was limited to a consideration of the facts relating to the street on which the violations were.

      7. An owner of land laid it out into streets and blocks, and by restrictions in deeds to purchasers fixed a building line. An owner of a lot on one street sought to restrain the adjacent owner from violating the building restrictions. Of the thirty-six' houses on one side of the street nine were over the restrictive line from one inch to four and one-half inches. There was also an old house at the extreme westerly end of the street which had a closed-in veranda extending over the line a distance of over nine feet. Of the forty-three houses on the other side of the street, eighteen were over the line from two inches to a little over two feet. There was nothing to show that the original owner had consented to the violations.—Held, that the violations were too insignificant in extent and in number to justify the court in inferring a general abandonment of the building restriction, even if the original owner could abandon or release a restriction which it had made for the benefit of all its grantees.

      Mr. Aaron E. Johnston and Mr. Charles II. Ivins, for the complainant.

      Mr. David Éarvey and Mr. Alan II. Strong,' for the defendants.
   Howell, V. C.

Tlie Ocean Beach Association was incorporated on March 13th, 1873. P. L. 1873 p. 1089. It was authorized to purchase and sell lands, and was especially empowered to require any grantee from it to make and maintain such style and character of improvements on the lands conveyed or on the streets fronting thereon as might seem most expedient for securing a uniform system of development and improvement.

The corporation purchased a tract of land extending from the Atlantic ocean to Shark river, in Monmouth county, with the intent of promoting the seaside resort which is now known by the name of Belmar. It at once laid out streets and avenues through the property east of P street and filed maps thereof, the streets running north and south being designated by the letters of the alphabet, and the avenues running east and west, at right angles to the streets, being designated by numbers. The streets were laid out sixty feet wide and the avenues eighty feet wide. Before any lots were sold by the corporation, its board of directors on June 9th, 1813, passed the following resolution:

“Resolved, That it is highly important to maintain uniformity in the line of buildings on the main avenues of the Association, and for securing said object that no building be erected on said avenues nearer to the line of same than twenty feet.”

This resolution was entered upon the minutes of the corporation and no public filing or other general notice was given of it. On March 21th, 1811, the corporation made a deed to Ellen T. H. Harvey for a plot of land containing about three and a quarter acres, including the lots now owned by the complainant and the defendant. This plot lay west of P street, and between that street and Shark river, and at the time of the conveyance had not been plotted into lots, nor -had there been filed any map showing the lines of streets and avenues through it. It will be observed, however, that the deed refers to several streets and avenues by name; these were afterwards plotted and made coterminous with the streets and avenues, which had been previously laid out east of P street. This deed of conveyance is in the usual form of a warranty deed, but it was made “Subject, nevertheless, to the covenants, conditions and restrictions contained in the aforesaid act entitled ‘An act to incorporate the Ocean Beach Association.’ ” The deed also contained a covenant made by the grantee in the following words:

“And the said party of the second part, for herself, her heirs and assigns, does covenant and agree to and with the said The Ocean Beach Association, their successors and assigns, that the said party of the second part, her heirs and assigns, shall not sell or suffer to be sold on the said premises hereby conveyed any spirituous or intoxicating liquors, nor violate any of the provisions contained in said act of incorporation, by-laws, rules or regulations made by the said Association at any time.”

The title to these two lots passed by several mesne conveyances to a corporation known as the Land and Loan Company, by deed dated January 23d, 1907. All the intervening deeds, with the exception of one made by an auditor in attachment, make reference to the covenants, conditions and restrictions contained in the deed from the Ocean Beach Association to Mrs. Harvey. On February 2d, 1907, the Land and Loan Company by its deed to- Cyrus B. Honce made the first severance of the title to the lots in question. By this deed it conveyed to Honce lot No. 1963 on the corporation’s map, which was on September 18th, 1907, conveyed by him to the complainant, Mrs. Newbery. The deed to Mr. Honce is made subject to certain conditions, covenants and restrictions theretofore imposed upon said land and premises by the Ocean Beach Association, and the deed from him to Mrs. Newbery is made subject to all the covenants, conditions and restrictions contained in the former deeds for the same premises. Oil June 1st, 1907, the Land and Loan Company conveyed to the defendant lot 1964, which adjoins the complainant’s lot on the west. This deed contains the following at the end of the description: “Under and subject, nevertheless, to certain conditions, covenants and restrictions heretofore imposed upon said land and premises by said Ocean Beach Association.”

The complainant and defendant therefore own adjoining lots on the association tract, both fronting on Tenth avenue and lying west of F street, the complainant’s lot being the more easterly and the defendant’s lót the more westerly of the two. On the complainant’s lot is.erected a dwelling-house, in which reside the complainant and her family; on the defendant’s lot is a livery stable, the main building of which extends within the limited area about three inches. The defendant has laid a foundation for an office, which extends about eleven feet within the restricted area, and is about to construct an office building thereon. The distance between the complainant’s house and the defendant’s livery stable is about six to eight feet. The complainant’s bill is based upon the allegation that there was a general plan for the improvement of Tenth avenue by maintaining the front line of the houses twenty feet away from the street line, of which general plan the defendant had notice.

There was evidence tending to show that all the deeds of conveyance made by the Ocean Beach Association for lands covered by their maps contained -the same covenant that appears in the deed from that corporation to Mrs. Harvey. And it likewise appears that that corporation did formulate and lay out a general plan for the uniform improvement of all the property which it owned at that point. Both complainant and defendant must be charged with notice of these facts for the reason that they are specifically referred to in both their deeds. Such was the determination of this court in the case of Hayes v. Waverly and Passaic Railroad, 151 N. J. Eq. (6 Dick.) 345; and my conclusion is that the lands of the complainant and the defendant were bound by the resolution of June 9th, 1813, although it only appears in its complete form in the minute book of the private corporation which owned the land. This must be the only conclusion that can be reached, because, the first deed in this title refers to the by-laws, the rules and the regulations made by the grantor upon the first transfer of the title.

The phrase <cat any time” contained in the covenant in the Harvey deed refers to the date of the Violation and not to the date of the adoption, of by-laws, rules or regulations.

The complainant having tiras established the application of the restrictive covenant to the lands of the defendant, it next becomes necessary to inquire whether the covenant is of a character that can be enforced and whether the complainant is in a position to be entitled to- insist upon it.

The first objection made by the defendant is that the covenant is uncertain. It must be conceded that restrictive covenants must not be vague or uncertain, that the complainant’s right to insist upon the covenant and to invoke the injunctive powers of the court must be clear and satisfactory. Sutcliffe v. Eisele, 62 N. J. Eq. (17 Dick.) 222. The covenant applies the building line restriction to what it calls the “main avenues.” Defendant insists that this description of the highways to which the covenant was intended to apply is illusory, vague and uncertain, because no one can tell from the context what is meant by the word “avenues” or by the words “main avenues.” The first map of the Ocean Beach property appears to have been made on May 9th, 1873, and to have been filed in the office of the county clerk of Monmouth county on October 4th of that year. The map was consequently made before the passage of the restrictive resolution. The map appears upon inspection to have distinguished between the two classes of public highways laid out upon it, calling one class streets and the other class avenues. The avenues, being somewhat wider than the streets, must have been then considered to be the main public highways. At that time there were no buildings upon the property, and there were no physical marks from which it could be deduced that one avenue was more of a main avenue or that one street was more of a main street than any other avenue or street. The only thing the board of directors could have had before them was the map on which it plainly appeared that the avenues were the main highways because they were wider than those highways which were called streets. It is therefore quite apparent that the word “main” is surplusage and that the covenant was intended to apply not to the streets at all, but to apply to each and all of the avenues. The objection of invalidity on account of vagueness and uncertainty is therefore not tenable.

The right of the complainant to bring the suit is, in my opinion, very clear. She is within the authority of DeGray v. Monmouth Beach Association, 50 N. J. Eq. (5 Dick.) 329; affirmed, 67 N. J. Eq. (1 Robb.) 731; and see the most recent declaration of the English chancery division on the subject in the opinion of Mr. Justice Parker, in Elliston v. Reacher (1908), 77 L. J. Ch. 617.

One of the objections to her position as a complainant is that she has violated the covenant herself and therefore ought not to be heard to complain of violations by others. It is true that the piazza in front of the complainant’s house extends -within the restricted area, but it is an open piazza and is no obstruction to the view from the defendant’s property, and is within the ruling of Vice-Chancellor Emery in Morrow v. Hasselman, infra.

Although the Ocean Beach Association formulated a plan for building line restrictions which should cover all its property, yet when it comes to specific violations the consideration of the subject must be confined to the street on which the violations are. This was so held by Vice-Chancellor Emery in Morrow v. Hasselman, 69 N. J. Eq. (3 Robb.) 612, and applies with peculiar force to the case in hand. Therefore, taking into consideration Tenth avenue alone, we find that the street extends westerly from the Atlantic ocean to the Shark river, a distance of about two thousand feet; it is cut up into eight blocks, the property of the parties hereto being on the seventh block from the ocean.

Becurring to the particular statements about the houses, it appears that there were at the time of the hearing seventy-nine houses erected on Tenth avenue, of which thirty-six are on the south side and forty-three on the north side. Of the thirty-six on the south side nine appear to be over the restrictive line from one inch to four and a half inches. In addition thereto there is-an old house at the extreme westerly end of Tenth avenue and near the Shark river which has a closed-in veranda that extends over the line a distance of nine feet two inches. Of the forty-three houses on the north side eighteen appear to be over the line, although the witness who speaks of them gives the distances of sixteen only. These encroach from two feet three and a half inches down to two inches, those extending over the line as much as a foot being wholly east of F street. It thus appears that of the total number of houses on the street (seventy-nine) fifty-two are erected in compliance with the terms of the resolution, and twenty-seven extend over the restricted line. Of the twenty-seven there are but six which are one foot or more over the line. These six all lie east of B street and are distant to the eastward of the complainant’s lot nearly thirteen hundred feet; all the remainder extend from one inch to ten and a half inches over. T do not think that this situation discloses an abandonment of, or a disposition to abandon, the line which was fixed by the resolution of 1873. There is no evidence whatever that the original grantor, the Ocean Beach Association, gave its consent or in any way actively promoted any of these violations, or that it tacitly assented thereto. It appears that several years ago, and probably not later than 1896, the association disposed of all its lands, and as a corporation has not had since that time any interest in the property, and indeed it is difficult to see how the association could abandon or release a covenant which it had entered into for the benefit of all its grantees. Neither do I think that mere acquiescence by the complainant in the violations above referred to would be any evidence of consent on her part. The violations are too insignificant in extent and in number to justify the court in inferring a general abandonment of the covenant. The fact that six owners saw fit to subject themselves to the liability of a lawsuit by violating the covenant certainly cannot be held to be a general abandonment of the contractual relation between the Ocean Beach Association and its various grantees. Acquiescence in a trivial breach of such a covenant does not conclude a complainant from relief in respect of a more important character. Mr. Justice Fry in Richards v. Revitt, 7 Ch. Div. 224; 47 L. J. Ch. 472; German v. Chapman, 7 Ch. Div. 271; 47 L. J. Ch. 250; Woodbine Land and Improvement Co. v. Riener, 72 N. J. Eq. (2 Buck.) 787.

The case of Barton v. Slifer, 72 N. J. Eq. (2 Buch.) 812, is applicable to the facts in this case. The situation there was very much the same as here. There the Ocean City Association became the owner of a tract of land which now comprises Ocean City, in. Cape May county, and laid it out in streets and lots, and inserted in all their original deeds covenants restricting the construction of buildings, and it was held that a small number of violations of the restrictive covenant could not be held to be presumptive evidence of a general abandonment of the plan originally determined upon, and that where such a plan existed any purchaser had a right to enforce the covenant.

It was held in Morrow v. Hasselman that slight and immaterial violations of the restrictive covenant would not be considerecl unless they went to the extent of showing a general abandonment of the restrictions by the owners of the property along the line of the street. It is clear that the original grantor who first imposed the restrictions upon the property, and with whom the contractual relation originally existed concerning the house line, has done nothing which would indicate an intention upon its part to disregard or abandon the covenant. Nothing short of general acquiescence in the violation of the covenant would be sufficient, in my opinion, to raise the presumption of abandonment.

The decree will therefore be for the complainant.