text:
    Catharine Dieffenbach v. William Grece.
    [Filed February 19th, 1898.]
    Upon the facts proven in this case — Held, that there is nothing to show the will was the product of undue influence.
    On appeal from a decree of the Hudson county orphans court, which admits to probate a paper purporting to be the last will and testament of Christina Trippensee, dated May 31st, 1894.

      Mr. James B. Vredenburgh, for the appellant.

      Mr. James A. Gordon, for the respondent.

      Mr. Clarence Kelsey, for Ernst Trippensee.
   The Ordinary.

Christina Trippensee executed two wills, so far as appears by the proofs in this case; one on the 3d of May, 1894, and the other upon the 31st day of the same month. The latter was ordered to be admitted to probate by the decree of the orphans court nowin question, and this inquiry, reviewing the correctness of the decree, deals with its validity.

Mrs. Trippensee died on the 8th of June, 1894, in the seventy-second year of her age. She had been twice married; first to John George Steinbromm, who died in 1885, by whom she had one child, the appellant, Catharine Dieffenbach, and second, in 1890, to Ernst Trippensee, a man ten or eleven years her junior, who survives her. She left an estate worth less than $10,000, consisting of a house and two lots on Sherman avenue, in Jersey City, where she lived at her death, valued, with its furniture, at about $2,000; a mortgage for $1,000 upon the house in which her daughter, Mrs. Dieffenbach, lived, on Zabriskie street, in Jersey City, and a promissory note for $6,000, made to her by Niven & Company, for money loaned.

The will of May 3d, 1894, gave the $6,000 note to her daughter, the $1,000 mortgage to her daughter’s eldest son, a young man twenty-three years of age, who is blind or partly so, and her household furniture to her husband, and also devised the Sherman avenue property to her husband and daughter; the husband to take it for his life, or until he should remarry, and the daughter to take the remainder in fee; the daughter to pay all taxes and water rents, so that the husband’s enjoyment should be free from those charges. It appoints Frederick Dieffenbach, Jr., the nephew of the husband of the appellant, its executor.

The last will, of May 31st, gives the entire estate, real and personal, to the husband of the testatrix for his life, with the remainder to the daughter, and provides that the executor of the will shall have power to sell the real estate if it shall be to the interest of the estate to do so, and if the husband of the testatrix shall be of that opinion, in which case the executor is to invest the proceeds of sale.

In early life Mrs. Trippensee was in religious belief a Lutheran, as were her relatives, but about thirty years before her death she took interest in the Christian Israelites and thereafter worshiped with them. Among them she met Ernst Trippensee, whom she subsequently married. He appears to be a zealous member of that religious sect, and, because of his obtrusive zeal in furthering its interests, to have been displeasing to his wife’s relatives; so displeasing that the marriage led to a temporary estrangement between Mrs. Trippensee and her relatives, which later took permanent shape in relations more or less formal and strained.

Trippensee was a carpenter by trade, but did little work after his marriage. He had a small sum of money, with the aid of which, supplementing his wife’s income, he and his wife managed to live in the lower floor of the Sherman avenue property, the upper floor being let to tenants.

In March, 1894, it developed that Mrs. Trippensee was afflicted with a cancer in the stomach, which soon destroyed her ability to retain food and secure nourishment. She became emaciated, and, as the disease progressed, suffered so much pain that her physician commenced to administer morphine to relieve her. In April it was recognized that it would not be long before further nourishment would become impracticable, and she would die of starvation.

Mrs. Dieffenbach lived about two blocks from her mother, and, during her mother’s illness, was as attentive as her home duties and troubles would permit. After a sickness of several weeks, her husband died on the 11th of April, 1894, leaving her with six children, the eldest of whom was the blind son already mentioned. But with all this trouble at home, she saw her mother nearly every day, and frequently sent sepecially-prepared dishes to her.

Trippensee and Dr. Joseph L. Niven bestowed all the other care that the sick woman received. The husband was constantly with her, assiduously and tenderly performing every duty. It is insisted that the proofs demonstrate that the testatrix feared him, but my conclusion upon them is, that the suggestion of fear on her part is true only to the extent that she believed that her husband would not approve of any disposition of her property that would not make provision for him during his life. The entire estate was small. He claimed that he was too feeble in health to work, and it appeared to her to be ingratitude, after his devotion to her, to deprive him of the income of any part of her estate. Her fear was of his disappointment and his possible reproach of her, if she should refuse to give him the income of her estate for his life.

It does not appear what the daughter’s means of livelihood were, or that she was so straitened in circumstances, after the death of her husband, as to make a portion of her mother’s income of great importance to her. There is no doubt that she desired to share immediately in her mother’s estate, but whether that was because of her need, or because of her dislike of Trippensee, or because of both, is indeterminable from the evidence. Possibly she needed the assistance, and that fact contended in the mother’s mind with her disposition to provide for her husband as he wished.

In April Dr. Niven resorted to morphine to alleviate the pains Mrs. Trippensee suffered. He commenced by giving her one-eighth of a grain every evening, and after that, as she became more accustomed to the drug and less affected by it, he increased the size and frequency of the dose, reaching two grains a day before she died

On the afternoon of the 3d of May, at about two o’clock, Jacob Kolb, a brother of Mrs. Trippensee, called to see her. He is a Lutheran minister. He had quite vigorously opposed his sister’s marriage to Trippensee, and was so offended by it that, for a year or more after the marriage, he did not visit her. When he called, on the 3d of May, he advised his sister that she should make a will, and that her property should be given to Mrs. Dieffenbach, her daughter. Mrs. Dieffenbach was present at this conversation, and took part in it. She says that her mother expressed a wish to make a will, and talked with her uncle about its terms, concluding upon such a will as that which was made that day; that her mother said that Trippensee should be gotten out of the way when the will should be executed, and also that someone should be procured to draw the will.

It appears that immediately after this conversation Jacob Kolb went away, and that about five o’clock in the afternoon Elizabeth Kolb, the wife of another brother of Mrs. Trippensee, with her daughter, came from New York to the Trippensee house; that shortly thereafter Trippensee was sent to Dr. Niven’s office for medicine, where he was detained, as though by preconcerted arrangement, for an hour, first in waiting in an ante-chamber for an audience with the doctor, and then in a long conversation in which the physician engaged him; that Frederick Dieffenbach, the nephew of the appellant’s'husband, who is a New York lawyer, about that time came to the appellant’s house, and the appellant’s son William (the blind son) called two gentlemen to his mother’s house to act as witnesses to the will, and that then the lawyer and witnesses, Mrs. Dieffenbach and her son went to the house of Mrs. Trippensee, arriving there after Trippensee had gone to the doctor’s. Frederick Dieffenbach then prepared the1 will, and it was executed while Mrs. Trippensee was surrounded by those who were favorable to the claims of her daughter — the daughter herself, her son, her nephew, her aunt and her cousin, and two gentlemen who were not unfriendly. These two gentlemen satisfy me that Mrs. Trippensee appreciated what she was doing, although she was feeble and in bed. One of them says that “the only difference that occurred” was that Mrs. Trippensee insisted that Mrs. Dieffenbach should pay the taxes, remarking that “ Ernst had little enough to live on; ” that Mrs. Trippensee urged them to hurry, that Ernst would come, and, when the work was completed, she “thanked God” that it was finished.

It thus appears that within a few hours the subject of will-making was broached and the will became an accomplished thing, and that, although the will was made under the supervision and influence of the daughter and her relatives and in the absence of the husband, the husband was not entirely excluded from a share in the property.

The will in dispute was made twenty-eight days later.

The disease from which Mrs. Trippensee suffered had then progressed so far that Dr. Niven had given up all hope of her recovery, and was prescribing morphine merely to relieve her from pain. He says that he had increased the dose, so that at that time she was taking three-quarters of a grain a day, and was constantly under the influence of the drug. The testimony of other witnesses exhibits that she was generally asleep or in a lethargic condition, but, at the same time, was capable of being aroused to intelligence.

Dr. Romeo F. Chabert, a physician of the highest character and standing, with an experience of many years’ practice in his profession, was called by the orphans court, with the assent of all parties to the controversy, to testify touching the effect of morphine upon the human system. He said that in his observation the controlling effect of a dose of morphine passes away in about two hours; that the drug does not accumulate in the system, but, like alcohol, acts temporarily and passes away. He is of opinion that the continuous subjection of the person to its use for months would weaken his other power of resistance to the importunity of others, but he does not think that one-quarter of a grain of morphine, administered every six or eight hours to a woman in pain, would have any influence upon her mind. Of' such a case he says that an hour after taking a quarter of a grain she would be in full possession of her mental faculties, and, if wakened ten or fifteen minutes after taking the dose, she would at first be confused, but, the effect passing over, she would be in possession of her mental faculties. The doctor was shown the signature of Mrs. Trippensee to the will in dispute, and was unable to detect any sign of a nervous trembling of the hand, and expressed the opinion that the person who wrote the signature was not at that time under the influence of morphine to any considerable degree.

The will of May 31st was executed in the presence of William Grece, a reputable lawyer of Jersey City, two neighbors, and the husband of Mrs. Trippensee. As has been stated, it differs from the earlier will in that it gives the husband the $6,000 note and $1,000 mortgage as well as the Sherman avenue property, for his life, and thereby is apparently more favorable to him than the earlier will. Trippensee says that on the evening of the 30th of May, a young man named Edward Hirsh came to see him, and that his wife then said: Ernst, now Edward is here, go round to Mr. Meyers and Mr. Davis to come around here that something be made, or else they will come and take everything away from me and leave me nothing.” He says that he did not then know that the will of May 3d had been made, and that he told her not to. worry, that his God would take care of him; that the next morning he offered to go and get Mr. Grece, who is a German, and had theretofore been employed by his wife, and that she appeared to him to be pleased and told him to do so, and that, locking her in the house alone, he ran and asked Mr. Grece to come to her, and then immediately returned home; that ten or fifteen minutes later Mr. Grece followed him and inquired of his wife what she wanted him for, and she replied that she wanted to have a will made; that Mr. Grece, having a place prepared for him to write upon, sent him (Trippensee) to get witnesses for the will, and he went out, leaving Mr. Grece alone with his wife, and found Mrs. Davis, a next-door neighbor, and Elijah V. Meyers, a real estate and insurance agent, both of whom had known his wife and consented to act as witnesses.

Mr. Grece testifies that Mrs. Trippensee said to him: “ I want to make my will; will you look out for Ernst ? The other will was lost or destroyed, and I have signed some papers recently that Mr. Dieffenbach read to me. They were read to me in English and I didn’t understand it, and were read to me in a hurry, and I really don’t know what it was that I have signed.” He says that he then questioned her as to how she wanted to dispose of her estate, and she told him that she wanted it to go to her husband for his life, and then to her daughter. He says that she appeared to him to understand what she was doing; that she was sick, but conversed with intelligence for three-quarters of an hour while her husband was finding the witnesses; that when the witnesses came, he, Grece, translated the will to her in German, and then asked her if he should make known its contents to the witnesses, to which she replied that he might read it to them, that there was no secret in it, and that he then read the will in English to the witnesses, neither of whom understood German.

It appears that Mrs. Trippensee could speak English with difficulty, but that she understood best when she was addressed in her native language.

The formalities required in the execution of the will were-duly observed. The witnesses had each known Mrs. Trippensee about six years. They agree that she was very weak when the will was executed, but that she had sufficient strength to raise herself in bed to a sitting posture, take a book on her knee, and sign her name. They thought that she displayed as much intelligence as she had ever before exhibited.

It appears that Trippensee was in the room during the presence of the witnesses, but that he did not do anything, apparent to-them, to influence or control his wife’s free agency. He did not even assist her to rise when she prepared to sign the will, though,, after she had signed, he helped her to lie down again.

It is possible, from the fact the wife was dependent upon him for every attention she received, to the most trivial and menial office, that he may by threats or coercion have dominated her will, but there is no evidence, save in presumption from circumstances, that he essayed in the slightest degree to induce his wife-to do that which she would not have done if she had been left to herself. The influence of his kind offices to the suffering dying woman are not to be accounted against him. His presence-at the execution of the will and his participation in the production of the instrument are explained by his duty in respect of those offices. Against the necessity of his ministration to the wants of his wife, and his testimony, direct and positive, that he did not coerce her to make the will, his participation in the production of the instrument cannot prevail.

The insistence of Mrs. Trippensee, when the will of May 3d was made, that the taxes upon the Sherman avenue property should be paid by her daughter, and her remark that Ernst had-little enough to live on, and her haste to get through the execution of the will before her husband should return from Dr. Niven’s, impress me that she was not entirely satisfied that she had treated her husband justly. It may well be that after making that will she meditated upon the patient continuance of her husband’s devotion to her, and concluded that the gift of the entire income from her small estate would best emphasize her appreciation and gratitude. Moreover, she may have been influenced to make the change from the will of May 3d, because that will did not procure from her any more attention from the women who were interested in its production than they had rendered her before it was made.

I am of opinion that Mrs. Trippensee possessed sufficient capacity to make the disputed will, and that it has not been shown that that document is the product of undue influence.

I will affirm the decree of the orphans court.


source: Caselaw Access Project

author: The Vice-Ordinary.

license: Public Domain

text:
    In the matter of the granting of letters of administration upon the estate of William Grissom, deceased.
    [Filed November 30th, 1897.]
    An appeal will not lie directly to the ordinary, from an order of the surrogate granting letters of administration.
    This is a petition of appeal from an order of the surrogate of Gloucester county granting letters of administration upon the estate of William Grissom, deceased.
    The answer to the petition challenges the right of the petitioner to bring the order of the surrogate into this court by an appeal.

      Mr. Harrison H. Voorhees, for the appellant.

      Mr. David O. Watkins and Mr. Robert S. Clymer, for the respondent.
   The Vice-Ordinary.

The statutory provisions now existing relative to appeals to this court are to be found in sections 173, 174, 175 and 176 of the Orphans Court act. Gen. Stat. p. 2396.

An appeal is given by section 175 to this court from all proceedings of surrogates from which an appeal is not given by preceding sections to the orphans court.

If the right to appeal to the orphans court from an order of a surrogate granting letters of administration is provided for in preceding sections, then no appeal lies to this court.

By the express language of section 173, the right of an appeal to the orphans court is conferred upon any person aggrieved by any order or proceeding of a surrogate in proving an inventory or granting letters of administration, or of guardianship.

The method of review is by an appeal to the orphans court, and by section 176 from the decree of the orphans court, if adverse, to this court.

An appeal will not lie directly from the order of the surrogate to the ordinary, and this appeal must be dismissed.


author: Magie, C. J. Depue, J.

text:
    Celine M. Duvale, appellant, v. Charles L. Duvale, respondent.
    [Filed February 28th, 1898.]
    1. When the consideration of lands conveyed to a wife is paid by her husband, the presumption is that the transaction is a settlement on the wife; but such presumption may be overcome by proof of facts accompanying the transaction, and showing the intent of the parties to have been that the husband should have an interest therein notwithstanding the conveyance to her.
    2. When the proofs show clearly that the intent of the parties is that only a limited interest in the lands should be settled on the wife, the husband holds in equity such estate and interest therein as was not settled on her, and her title is subject to a resulting trust in his favor to that extent.

      3. An agreement by a wife to devise lands to her husband which induces him to pay for them, and have them conveyed to her-, and to expend money in their improvement, is an enforceable contract; and when the wife in her lifetime repudiates the agreement and makes other testamentary disposition of such lands, the husband is entitled to the intervention of a court of equity to prevent such violation of the agreement.
    On appeal from a decree advised by Vice-Chancellor Reed, whose opinion is reported in Duvale v. Duvale, 9 Dick. Ch. Rep. 581.

    Brief for appellant.
    The law is clear. It is settled by Lister v. Lister, decided first by Chancellor Runyon, whose opinion was adopted by the court of appeals. The case is on all fours with this, and is found reported in 8 Stew. Eq. 49; 10 Stew. Eq. 331. It that case, deeds had been directed by the husband to be made to the wife, he advancing all purchase-money, and then proceeding, without further agreement, to expend large sums of money in improvements upon the property. He swore, and sought to prove, that these deeds were given in trust for the use of the husband and the family. She denies this assertion. The property purchased, with improvements, exceeded $60,000 in value. The wife had been unfaithful, had been divorced for that cause, had married another man, and was living with him, yet the court decreed that the property having been given to the wife was hers, and dismissed the bill of complaint. The views of the chancellor are very pertinent. See 8 Stew. Eq. 52. See, also, corroborating, Persons v. Persons, 10 C. E. Gr. 250. See, also, Read v. Huff, 13 Stew. Eq. 229, decided in the court of appeals by Mr. Justice Depue. His views are likewise very pertinent to this case. Refer likewise to Krauth v. Theile, 18 Stew. Eq. 407; Linker v. Linker, 5 Stew. Eq. 174; Whitley v. Ogle, 2 Dick. Ch. Rep. 67. The doctrine of these cases is, that when a man purchases land and causes it to be conveyed to his wife, the presumption is that it is a settlement upon her. No resulting trust arises from the payment of the money by the husband. The. burden of proof is upon him if he would show that any trust existed. The proof which in such cases shall overcome the presumption of a gift to the wife must be of facts antecedent to, or contemporaneous with, the purchase, or else immediately afterwards, so as to be in fact part of the same transaction, and it must be equally satisfactory and explicit with the proofs required to establish a resulting trust. The language used by the court in Krautle v. Theile is apposite. They say complainant testifies under the powerful influence not only of pecuniary interest, but of bitter enmity to the defendant, and after having acquiesced for several years to the daughter’s title to the property in question, without intimating that she had any claim upon it. She is not sustained by any documentary proof, and her statements upon other subjects are contradicted so as to cause doubt as to her reliability.
    In Linker v. Linker it is said that where there is conflicting evidence as to a husband’s object in making conveyance of lands to his wife, the ordinary presumption that it is intended as a provision or settlement for her benefit is not rebutted.
    The present case is distinguishable from those where such trusts as here alleged have been established. The evidence in them has been more explicit and convincing. In Carr v. Demarest, 10 Stew. Eq. 393, both husband and wife testified to such an agreement as is here set up. In Newkirk v. Place, 2 Dick. Ch. Rep. 447, letters were produced containing acknowledgments that the daughter held for her father’s benefit. In Lovett v. Taylor, 9 Dick. Ch. Rep. 311, there were several witnesses to the intention of the party, and no contradiction.
    The facts in this case are not obscure. The chronology is very important.
    (Here follows a discussion of the facts.)
    In conclusion of this review of the tacts, we say, first, that on the whole testimony, no court can be rationally convinced of the truth of the complainant’s allegation that his gift of the land was clogged with any trust. The burden of evidence is upon him, and the court must be satisfied by clear and convincing testimony. Midmer v. Midmer’s Executors, 12 C. E. Gr. 548. Second, we say that the weight of the testimony strongly negatives the allegation of such a trust, and that, on the proofs, that negative has been manifested. Thirdly, we say that whatever occurred between the parties in relation to the cross-wills, was after the conveyance of the land to Mrs. Duvale, and is not to be considered. Fourth, we contend that the relief prayed in relation to those wills is not within the jurisdiction of the court of chancery. No court can compel a party to make a will, nor, if it has been made, prevent the maker from revoking or altering it.
    Some legal propositions are pertinent and important.
    Where a married woman enters into a contract as a party, by which she agrees to convey land, the agreement cannot, of course, be enforced against her, even when she acts as trustee in making the contract. Pom. Spec. Perf. § 459; Avery v. Griffin, L. R. 6 Eq. 606; Nichols v. Jones, L. R. 3 Eq. 696.

    Husband and wife cannot, except in carefully-excepted cases, testify one against the other. Shoul. H. & W. § 82; 1 Greenl. Evid. 340, and cases cited.
    Mutual consent will not authorize the breach of this rule.
    The disability of the husband is as great as that of the wife. 1 Greenl. Evid. 334.
    The rule applies alike to evidence of declarations made by husband and wife for or against one another, and to their testimony in person. 1 Greenl. Evid. 341; Brown v. Wood, 121 Mass. 137.

    Such evidence as this, though under objection admitted in this case, was strictly of the nature of confidential communications and was inadmissible.
    Husband and wife cannot contract with each other, or sue each other on alleged contracts. Lord Hardwicke, in Lanney v. Athol, 2 A. V. At. R. 448; 1 Bl. Com. 442; 2 Kent Com. 129.

    See, as to modern rules, Shoul. H. & W., Part VI., “Transactions Between Husband and Wife.”

    These modern rules obtain only where the doctrine of community in property is established by statute. Such is not the case in New Jersey.
    In Lister v. Lister, the parties had been divorced; so the one could sue the other. In Osborne v. Osborne, 2 Stew. Eq. 385 (a valuable case as to the right and value of oral evidence to set aside a deed), the question as to the right of suit was not raised. Nor was it in Sing-Bow v. Sing-Bow.

    So far as I know, this is the only case in New Jersey where a husband who sued his wife to enforce a contract for a trust was, under objection, allowed to do it.
    Is not the statute of frauds conclusive ?
    A trust as to this property, between parties not husband and wife, could not be enforced unless in writing.
    Is there, then, any reason for doing it between husband and wife, and at the prayer of one against the other?
    Declarations forming part of res gestœ are indeed admitted, if proved by competent evidence. That evades the statute.
    But the question still remains, Can an alleged trust be enforced against a wife at the prayer of a husband ?
    And can a woman be compelled by the court of chancery to make a will in favor of her husband, or be restrained by its injunction from making any other?
    And can a decree be made against heirs unborn, or devisees before devise, or parties not known or beyond the probability of being known ?
    The court of chancery has large powers, but do they extend thus far ?
    The views, reasoning and decree of the vice-chancellor demand attention.
    The allegations of the bill are — first, that the deeds to the wife were made, and, of course, received by her, in trust for her husband. The second prayer asks that she may be directed to convey the same to him ; second, it is alleged that the deeds were made and received by her under and with the condition that she would execute a will devising this property to him, so that if he outlived her it would be his — and prayer was made that she be compelled specifically to perform this agreement.
    The vice-chancellor finds that the lands were conveyed to her under and pursuant to an agreement that the same should be held by her in trust for herself and her husband, during their joint lives and for the survivor of them, his or her heirs and assigns,- and that the same were held subject to an agreement by her to devise said lands by her will to him, his heirs and assigns.
    And so finding, he decrees that she holds her title to said lands subject to the trust above mentioned, as well as subject to her agreement to devise the same to the complainant. And that in case she dies first her heirs and devisees shall forthwith convey to him, and that an injunction issue enjoining her from devising the lands to anyone else during his life.
    The prayers of the bill are not granted. Mrs. Duvale is not declared to hold the premises in trust for her husband, nor directed to convey the same to him. She is declared to hold them under an agreement that they be held by her in trust for herself and him during their joint lives, and for the survivor of them, his or her heirs and assigns, of which trust there is no particle of evidence. She is not declared to hold them in trust for her husband, nor directed to convey the same to him.
    She is not decreed specifically to perform her alleged agreement to execute a will devising the lands to her husband. It is decreed that she be enjoined while her husband is living from devising the lands to any other person than to him.
    So much as to her. There is the additional decree that, in case she dies first, her heirs and devisees shall convey to him.
    The grounds of this certainly peculiar decree are stated on pages 162-165.
    * * * * * * * * * * *

      Mr. Cortlandt Parker and Mr. R. Wayne Parker, for the appellant.

      Mr. Charles L. Corbin, for the respondent.
   The opinion of the court was delivered by

Magie, C. J.

This appeal is from a decree that appellant' shall hold certain lands, the legal title to which is in her, in trust for herself and husband'during their joint lives, and for the survivor of them, his or her heirs or assigns, and subject to an agreement on her part to devise said lands by her will to respondent, his heirs and assigns. It further enjoins her, while respondent is living, from making a will devising said lands to any other person than him, and directs that if she shall die before him her heirs and devisees shall forthwith convey said lands to him.

The parties are husband and wife.

Appellant’s appeal is from the whole decree.

The opinion of Vice-Chancellor Reed, who advised the decree, contains so full a statement of the pleadings and proofs that it will serve no useful purpose to repeat more than seems essential to make intelligible the conclusions we have reached.

The prayer of the bill of respondent was in the alternative. He asked relief by a decree that the lands in question were held by appellant in trust for him and directing a conveyance thereof to him, and also relief by a decree compelling appellant to perform an agreement to execute a last will and testament devising said lands to him, with such incidental restraints and directions as would compel such performance.

The decree does not direct a conveyance of the lands to respondent, and he has not appealed.

The lands in question were conveyed to appellant by three deeds. The first deed was made June 12th, 1890. Respondent held a contract for the tract thereby conveyed, but satisfied his contract by requesting the owners to make the conveyance to which he was entitled to his wife. He paid the whole purchase-price, and thereafter expended large amounts of his own money in erecting a dwelling-house and making improvements on that tract. The second deed was made September 2d, 1891, and the husband furnished the purchase-money. Thereafter he spent much of his money in the erection of stables and other conveniences for use in connection with the residence on the lot first conveyed. The third deed was made July 29th, 1892, and the consideration paid for it was money which had been awarded to appellant for a part of the lot first conveyed to her upon a condemnation by a railroad company.

When lands are purchased by one person, who pays the purchase-price, and they are conveyed to another person who is a stranger, a trust in the lands is implied or results in favor of him who has paid the consideration. But where a husband purchases and pays for lands and takes the title in the name of his wife, such a trust does not necessarily result. On the contrary, a presumption arises that the husband has caused the conveyance to be made to his wife by way of a settlement upon her. Such a presumption may be rebutted and overcome by proof of facts accompanying the transaction which show that the intention of the parties was that the lands should not be held by the wife as settled upon her, but in trust for the husband. Her subsequent acknowledgment and recognition by words or acts may be given in evidence. If from all the evidence it is clear that the presumption of settlement is rebutted, a trust will then result which can be enforced. This well-settled doctrine is illustrated in many cases in our courts. Peer v. Peer, 3 Stock. 432; Persons v. Persons, 10 C. E. Gr. 250; Lister v. Lister, 8 Stew. Eq. 49; S. C., 10 Stew. Eq. 331; Read v. Huff, 13 Stew. Eq. 229.

The appeal, therefore, first presents the question whether the proofs in the case clearly show that the presumption that these lands which were paid for by the husband were conveyed to the wife as a settlement in her favor has been overcome, and that the parties to the transaction had other intentions.

It has been already stated that the decree does not direct a conveyance to the husband under the prayer of his bill asking that relief. Although he has not appealed from the decree, it is proper' to say that the conclusion in the court below, that he was not entitled to that relief, was entirely correct. It is true that respondent testified that, before the purchase of the first lot, his wife and he had conversations which expressed the intentions of both that the title which she was about to acquire should be conveyed to him whenever he desired.

If the transaction when finally completed was with the intention thus expressed, I think a trust in favor of the husband for the whole interest in the land must have resulted. But appellant denied that such conversations took place between them, and there is no such corroboration of the husband as to justify a determination that it is clearly made out that such was and continued to be the intent of the parties when that purchase was completed by conveyance to her.

But it is obvious from the proofs that if the previous intentions of the parties had been such as would be indicated by the conversations detailed by the husband, those intentions were changed before the completion of the transaction. The testimony of Cannon, the New York lawyer, and of respondent, and the proof of subsequent admissions made by appellant, render it entirely clear that although the land was to be conveyed to her she was to devise it to him by her last will and testament.

From this view of the evidence it results, in my judgment, that the settlement made thereby upon appellant was not of the whole estate in the land, but of a limited interest therein. It can probably be best expressed as being a settlement of a life estate in the land with a remainder in fee, contingent upon her surviving her husband. ' Therefore, there remained unsettled upon her the estate in the land which would result in case the fee was not cast upon her by the happening of the contingency contemplated. If she died before her husband the intention was that her heirs should have no interest whatever in the lands.

Since the husband paid the purchase-price, and the evidence shows with clearness that the settlement intended was limited, does a trust result with regard to so much of the estate as was not settled ?

The implication of a trust in such cases does not necessarily depend upon its affecting the whole interest in the lands in question. Thus it was held in this court that the payment of part of the purchase-money, if that part be shown with certainty, will create a resulting trust to the extent of that payment. Cutler v. Tuttle, 4 C. E. Gr. 549. So, in that class of resulting trusts which, Mr. Lewin says, arise when, upon a conveyance, devise or bequest, a trust is declared of part of the estate, and nothing is said of the residue, it is settled that the undisposedof equitable interest of the settlor will result to him or his representative. 1 Lew. Trusts *146; 1 Perry Trusts § 150. Lord Hardwicke declared that the reason why the court of chancery had allowed a trust by operation of law to arise in that class of cases was that the party by declaring part of the trust to be for another and by saying nothing as to the other part of it, shows his intention to be that the other was to have only one part of the trust, and consequently he himself ought to have the benefit of the other part. Lloyd v. Spillet, Barn. 384.

In my judgment these principles are applicable to the case before us, and appellant, when she took the conveyance of that land with the intention that a limited interest therein should be settled upon her, took and holds the title to all interest therein not settled upon her in trust for respondent.

This is the trust, as I understand it, the vice-chancellor found established by the proofs.

What has been said so far relates to the circumstances surrounding the transaction whereby the first conveyance was made to her, and the effect on the legal title acquired by the wife.

The vice-chancellor finds in the proofs other ground to support respondent’s claim. His conclusion is that the undertaking of appellant to devise the land to respondent induced him to make the purchase and vest the title in her. The proofs show that respondent commenced to make improvements on the tract first purchased, and finding that appellant was reluctant to make the will which it had been arranged she was to make, notified her that unless she did so he would withdraw his workmen and stop the work. Delay still occurring he did withdraw the workmen, and appellant then went and executed the will which had been drawn at the same time, or shortly after the acquisition of the first title. Thereby she devised her lands to respondent y then he resumed work on the improvement and spent thereon a large sum of money.

That will continued in existence unrevoked until after the acquisition by her of the two other tracts, and after respondent’s improvements on the tract secondly conveyed.

Upon these facts it is plain that it would be inequitable to' permit appellant to disregard her agreement to devise the land to respondent, which agreement had induced respondent to purchase the tract first conveyed to her and to expend large sums of money upon it.

Such an agreement is an enforceable contract, and a court of equity may intervene to require its enforcement. Van Duyne v. Vreeland, 1 Beas. 142; Johnson v. Hubbell, 2 Stock. 332; Parsell v. Stryker, 41 N. Y. 480; Van Duyne v. Vreeland, 3 Stock. 370; Pftagar v. Platz, 16 Stew. Eq. 440; Davison v. Davison, 2 Beas. 246; Young v. Young, 18 Stew. Eq. 27.

In this case the contract is between husband and wife, and therefore only enforceable in equity, and as the wife has repudiated it in her lifetime, and made other testamentary disposition of the lands, the husband is justified in asking the remedial intervention of equity to prevent the violation of the agreement.

All of the court deem the trust and contract applicable to the tract first acquired and enforceable against it. A majority of the court think that the contract is also applicable and enforceable as to the tract secondly acquired. As originally made perhaps that contract might not apply to the second tract, but when recognized and continued by the unrevoked will, it operated to induce respondent to expend his money on the purchase of that tract, to join it to the first tract, and to erect the stables, tank and other conveniences for the use of the residence on the first tract.

A majority also think that the tract thirdly acquired is impressed with the trust, and subject to the agreement as having been acquired with money raised out of the first tract which was in that situation.

The result is that respondent was properly held to have been entitled to relief. It remains to consider whether the relief which was accorded him was appropriate.

But neither the trust nor the agreement of which we find evidence justifies any restriction upon the appellant in the lands during her life. The effect of both is, that so long as she lives she has the estate therein which married women now hold by statute — that is, the same estate that she would have if she were a feme sole. Should respondent die before her, her estate in the lands is discharged from the trust and from the performance of the agreement. Should she die before him, the equitable estate in the lands vests in him, and he would be entitled to have them conveyed to him by the owners of the legal estate if she has not devised them to him.

The decree before us'goes farther, and declares that the lands are held in trust for herself and her husband during their joint lives, and for the survivor of them, his or her heirs or assigns. In respect to the provision as to the trust during their joint lives, it exceeds the trust which was intended and the agreement which was made, and it should be added it is not supported by the vice-chancellor’s opinion. This requires a reversal of the decree, and its modification so as to declare that appellant holds the lands subject to a trust in favor of the respondent, whereby, if she should die before him without devising the lands to him, an equitable estate in the lands in fee-simple would vest in him, which would entitle him to have the legal estate conveyed to him by her heirs or devisees. In other respects the decree is approved.

As this modifies the decree in a part to which no attention was directed in the argument, and which seems comparatively unimportant, no costs will be allowed upon the reversal.

Depue, J.

(dissenting).

The decree in this case is, first, “ that the said lands were conveyed to and held by the said Celine M. Duvale under and pursuant to an agreement that the same should be held by her in trust for herself and her husband during their joint lives, and for the survivor of them, his or her heirs or assigns;” and, second, “that the same were held subject to an agreement made by the defendant, Celine M. Duvale, to devise the said lands by her will to the complainant, his heirs and assigns.” The first part of this decree adjudges that the said tracts of land are held upon a joint estate for the husband and wife during their joint lives, with a limitation over in fee to the survivor. It is by no means clear from the opinion of the vice-chancellor that he reaches this conclusion upon the theory of a resulting trust or in virtue of some agreement between the husband and wife with respect to the title conveyed to her. This part of the decree cannot be sustained on the ground of a resulting trust. A resulting trust arising from the payment of the consideration by the one party — the conveyance being made to another — arises at the instant the deed is taken, and the legal title being vested in the grantee, the equitable estate becomes, ipso facto, vested immediately in the cestui que trust. The consideration for this conveyance was paid wholly by the husband. If the doctrine of a resulting trust applies to this case, the husband would have taken an estate in fee immediately upon the execution and delivery of the deed to the wife. No estate jointly in the cestui que trust and the grantee could arise except from the joint payment by husband and wife, each paying some aliquot part of the consideration. Cutler v. Tuttle, 4 C. E. Gr. 549; Wheeler v. Kirtland, 8 C. E. Gr. 13, 22; Thalman v. Canon, 9 C. E. Gr. 127; Shroser v. Isaacs, 1 Stew. Eq. 320; Krauth v. Thiele, 18 Stew. Eq. 407, 409; Midmer v. Midmer’s Executors, 11 C. E. Gr. 299, 304; Jamison v. Miller, 12 C. E. Gr. 587, 591.

Nor would a resulting trust arise in case of a conveyance to the wife on the mere payment of the consideration by the husband. Where a husband pays the consideration of the purchase of lands and has the conveyance made to his wife, the presumption is that a gift or settlement was intended, and a resulting trust will not arise in his favor from such payment; and the proof which in such cases shall overcome the presumption of gift to the wife must be of facts antecedent to, or contemporaneous with, the purchase, or else immediately afterwards, so as to be in fact part of the same transaction, and the proof, to have that effect, must be equally satisfactory and explicit with the proof required to establish a resulting trust. Read v. Huff, 13 Stew. Eq. 230. The case relied on to overcome the presumption that this conveyance was by way of a gift to the wife consists in evidence of an arrangement between the husband and wife that she should devise the property to him by her last will. Such an arrangement would leave in the wife an estate for her life as her own property separate and apart from her husband. I agree with the chief-justice that this part of the decree cannot be sustained.

With respect to the other part of the decree, I think there-was evidence to justify the vice-chancellor in finding, as a matter of fact, that the transaction between the husband and wife with respect to the first purchase was that she was to take title to-that tract on an agreement that she would devise that tract to-her husband by her last will. So far I concur in the opinion-of the chief-justice. But I am unable to find in the evidence any warrant for applying that agreement to the subsequent purchases. The vice-chancellor, in his opinion, deals with the agreement between husband and wife as made expressly with respect to the first lot. He draws the other property within the scope of that agreement, on the theory that the agreement covered-all accessions to the original lot. On this theory he deduces an implication against the presumption of a gift in such transactions-between husband and wife which is not justified. Each one of these purchases must rest upon its own circumstances, and the-inference that there was an actual agreement between husband and wife that subsequent conveyances, which are presumed to have been gifts, should have been made and taken upon a similar express trust, is unwarranted. The court is dealing with title to lands held under the usual muniments of title; and I agree with and adopt the remarks of 'Vice-Chancellor Van Fleet, in Midmer v. Midmer’s Executors, supra, that “nothing short of certain, definite, reliable and convincing proof will justify the court in divesting one of title to lands evidenced by a regular deed, and putting it in another.” That rule of law .is founded upon principles which are necessary to give certainty and security to legal titles. In my judgment it is applicable to this case. There does not appear in the evidence, nor is the fact so found by the vice-chaucellor, that, with respect to the last two purchases, there was any agreement whatever between the husband and wife with respect to the terms and conditions on which title for those parcels should be taken in her name.

I shall vote to affirm that part of the decree declaring that the defendant holds title to the lands described as the first purchase, subject to an agreement to devise the same to her husband, and to reverse the residue of the decree.

As to concurrence in the opinion as to the first tract:

Yea — The Chief-Justice, Depue, Garrison, Gummere, Lippincott, Ludlow, Van Syckel, Adams, Bogert, Hendrickson, Nixon—11.

Nay — None.

As to concurrence in the opinion as to the second tract:

Yea — The Chief-Justice, Garrison, Lippincott, Ludlow, Bogert, Nixon—6.

Nay—Depue, Gummere, Van Syckel, Adams, Hendrickson—5.

As to concurrence in the opinion as to the third tract:

Yea—The Chief-Justice, Garrison, Lippincott, Ludlow, Bogert, Nixon—6.

Nay—Depue, Gummere,Van Syckel, Adams, Hendrickson—5.

For reversal of decree—The Chief-Justice, Depue, Garrison, Gummere, Lippincott, Ludlow, Van Syckel, Adams, Bogert, Hendrickson, Nixon—11.

For affirmance—None.


author:
Depue, J.
      Collins J.

text:
    Lazar Sternberg et al., appellants, v. David Wolff et al., respondents,
    [Filed January 29th, 1898.]
    1. When, by reason of dissensions among the directors of a trading corporation, there is a deadlock in the management of its business by them, a receiver pendente lite may be appointed.
    2. The court, in granting injunction against defendant, may impose as terms that an injunction relating to the same matter go against complainant.

      On appeal from an order advised by Vice-Chancellor Pitney. (No opinion filed.)

      Mr. Robert H. McCarter and Mr. Louis Hood, for Lazar Sternberg et al.

      Messrs. Riker & Riker and Mr. Charles D. Thompson, for David Wolff et al.
   The opinion of the court was delivered by

Depue, J.

On the 25th of July, 1892, Sternberg, Wolff and Misch became incorporated under the General Corporation act under the name of L. Sternberg & Company, with a capital stock of $100,000, divided into one thousand shares, the par value of which was $100 each. The object for which this company was-incorporated was to carry on a general merchandise business.

At a meeting of the stockholders on the 26th of August, 1897,. Sternberg was the.owner of four hundred and ninety-nine shares;. Eosa Sternberg, his wife, of one share; David Wolff one share, and Eosa Wolff, his wife, four hundred.and ninety-nine shares; the situation being that one-half of the capital' stock was held by Sternberg and his wife, and the other half by Wolff and his wife. At this meeting the by-laws were amended so that the board of directors should consist of four members, and the whole number of directors should be necessary to a quorum, and the four persons above named were elected directors; Lazar Sternberg was- elected president, David Wolff being secretary and treasurer. Among the by-laws was the provision that Lazar Sternberg and David Wolff, and Henry Kern, the general-superintendent, should not be subject to discharge or reduction-of salary by any officer of the company, or by the board of directors, without the consent in writing of the majority in-interest of the stockholders; that other employes might be discharged either by Lazar Sternberg or David Wolff, and new employes should be employed only with the concurrence of both Lazar Sternberg and David Wolff, unless otherwise ordered by the board of directors.

It is unnecessary to go into particulars; it is sufficient to say that after the meeting last referred to Sternberg and his wife, as the one party, were the owners of one-half of the capital stock of the company, and Wolff and his wife the owners of the other half. Difficulties and dissensions arose between these four persons, in which Sternberg and his wife, the one-half in number of the board of directors, were engaged on the one side, and Wolff and his wife, the other half of the board of directors, were engaged on the other side. By reason of these dissensions the management of the business by the board of directors was in a deadlock, although the company was largely engaged in the conduct of the business for which it was incorporated. In consequence of the disputes between these parties, in October, 1897, Sternberg and his wife filed a bill in the court of chancery against Wolff to restrain him, among other things, from exercising the duties of treasurer and from discharging employes, or interfering with the regular business of the company for his own personal ends, with a further prayer that if necessary a receiver might be appointed to take charge of said company and manage the same pending the decision of this suit. No answer had been filed by Wolff when the hearing on this application was had before the vice-chancellor, but Wolff in his affidavit states that he believes that the safety of the business demands the appointment of a receiver at least during the pendency of the litigation, and until an adjustment of the interests of the stockholders can be arrived at. Rosa Wolff was not a party to the bill, but she made an affidavit stating that she was the owner of half of the company’s stock, and claiming that it was necessary for the protection of her interests that a receiver should be appointed for the corporation at least during the pendency of this litigation, and until the rights and powers of the officers and stockholders of the company shall have been adjusted and fixed under the order of the court.

This matter coming on for hearing before the vice-chancellor on bill, affidavits and counter-affidavits, the vice-chancellor advised an order dated November 6th, 1897, denying the application for a receiver, but ordering that, pending this suit, an injunction do issue enjoining David Wolff, the defendant herein, from drawing any promissory notes or checks of the company, or on behalf thereof, except for ascertained debts due by the said company, or from drawing any check to the order of himself, except for salary due him, after deducting all charges against him for rent and goods; the disputed items of $206 and $140 for banquet and stable account, respectively, not to be included in the ascertainment of said charges against him, the same being reserved until the final hearing of the case; and from discharging employes, except for cause, and that by the permission of the court; or from employing any new employes without the permission of the court, and from making or procuring to be made any list of the customers of said company; and from continuing to act as treasurer of the said company, unless within ten days from the date hereof he should file a bond in the penal sum of $20,000, conditioned for the faithful' performance of his duties as treasurer of the defendant corporation; and that the complainant Lazar Sternberg be likewise enjoined from drawing any promissory notes or checks of the company, or on behalf thereof, except for ascertained debts due by the said company; or from drawing any check to the order of himselfj except for salary due him after deducting all charges against him for rent and goods; and from discharging employes, except for cause, by the permission of the court; or from employing any new employes without the permission of the court; and from making or procuring to be made, any list of the customers of said company; and from inducing the employes of the company to fail to pay proper respect to the defendant and other officers of the company, and from inducing them to refuse obedience to their orders.

The vice-chancellor, in granting the injunction against Stern-berg, seems to have gone upon the ground that the mutuality of the injunction was necessary to protect the interests of all the stockholders in the affairs of the company pendente lite.

It is within the power of the court of chancery, in granting to a suitor an injunction, to impose terms, and I have no doubt that the terms imposed in this case were such as it was in the power of the court to impose, enjoining a defendant on the terms that an injunction relating to the same subject-matter should go against the complainant.

The business of the company, at the time these orders were made, in manufacturing and selling clothing, was very large, the company having its main place of business in the city of Newark and eleven branches located elsewhere in the state, and it is undeniable that the pendency of these injunction orders seriously interferes with the business of the company; and, in the judgment of this court, it is wholly impracticable for the court of chancery to take upon itself the control of the details of the business of this company in conformity with this injunction, as well as quite impossible that the business of the company should be profitably carried on without those who are engaged in the management of the business being allowed to manage and conduct the same upon business methods, rather than by the methods proposed by these injunction orders.

But it is apparent from the facts that appear in the bill and affidavits that some relief pending this litigation should be afforded in these proceedings. The two parties to the controversy — Sternberg and his wife on the one side and Wolff and his wife on the other side — are the owners each of one-half of the capital stock. These four individuals are directors of the company, and, by the by-laws, the whole number is necessary to make a quorum for the transaction of business. The dissensions between these two parties — Sternberg and his wife on one side and Wolff and his wife on the other side — have brought the affairs of this company to a deadlock, so far as any corporate action by the board of directors is concerned.

It may be assumed that the court of chancery has no jurisdiction to dissolve a solvent corporation and distribute its assets on the ground that the business of the corporation is improperly conducted by its board of directors, even though such mismanagement be with the concurrence of a majority of the stockholders ; but the jurisdiction of the court of chancery to control the business of a company, especially a trading company, pending a litigation over the management and conduct of its business, must necessarily exist, and, we think, pending a litigation such as that which is inaugurated by the proceedings in this case, a receiver may be appointed. Corporations such as the one now before us are mere trading companies, with a corporate organization for the convenience of conducting the business for which they were incorporated. Such a corporation has not the qualities of corporations created for public purposes. No reason appears why, in the matter of the control and conduct of its business, the corporation and its officers should not be within the control of the court of chancery to an extent corresponding with the control of that court over the business of a mere partnership.

The cases establish the power of the court in virtue of its general jurisdiction to preserve the subject of litigation pendente lite, though it may relate to the affairs of a trading company in form organized as a corporation. The two cases cited by the vice-chancellor in his second opinion are to that effect. Featherstone v. Cook; Trades Auxiliary Co. v. Vickers, L. R. 16 Eq. Cas. 298, 303. In the first case the complications in the affairs of the company arose out of a division in the board of directors, which made it absolutely impossible that the affairs of the company could be conducted with advantage. Vice-Chancellor Malins in that case says: “ With regard to private partnerships, nothing is of more frequent occurrence than the quarrels of partners. If partners quarrel, oust each other from the management, or so conduct themselves that the partnership cannot go on with advantage, it is every day’s practice for the court to interfere by injunction and appoint a receiver if necessary. With regard to public companies, I apprehend the same principle is applicable. If a state of things exists in which the governing body are so divided that they cannot act together, and there is the same kind of feeling between the members as there is frequently in the case of private partnerships, it is clearly within the rule of this court to interfere, and it will do so.” The court in that case intervened by injunction and receiver simply to protect the property of the company, to continue, however, no longer than until a governing body was duly appointed. In the latter case the dissension was also in the board of directors, one set of which closed the office doors of the company’s building, and the other set, with the aid of some laborers, broke open the doors with crowbars and forced the office open. The prayer of the bill was for the appointment of a receiver until the proper board of directors was constituted. The vice-chancellor placed the affairs of the company in the hands of a receiver pendente lite until a new governing body was appointed. The vice-chancellor’s opinion states the principle to be that the court will not interfere with the internal affairs of joint stock companies unless they are in a condition in which there is no. properly-constituted governing body, or there are such dissensions in the governing body that it is impossible to carry on the business with advantage to the parties interested; in such a case the court will interfere, but only for a limited time, and to as small an extent as possible.

Chancellor Runyon, in Einstein v. Rosenfeld, 11 Stew. Eq. 309, after citing the two cases already cited, did not dissent from the ruling of the vice-chancellor in those cases. He denied the appointment of a receiver on the ground that the business of the company was being carried on, and that there was no need of immediate interference on the part of the court for the protection of the property or business interests of the company. In Archer v. American Water Works, 5 Dick. Ch. Rep. 33, the present chancellor, after referring to the three cases above cited, said that if the present directors of the company continue their dissensions so that the affairs of the company are not speedily attended to, upon a proper application I will care for the property, pending the determination of the suit, through the instrumentality of a receiver. Such action will be supported by precedents and authority. My interference, however, by injunction and receiver, will be limited to the imperative requirements of the present emergency.” In .an earlier case Vice-Chancellor Van Fleet said: The power of this court to appoint a receiver of a corporation, either because it has no properly-constituted governing body or because there are such dissensions in its governing body as to make it impossible for the corporation to carry on its business with' advantage to its stockholders, I think must be regarded as settled, but I think it is equally well settled that this power is subject to certain limitations, namely, it must always be exercised with great caution and only for such time and to such an extent as may be necessary to preserve the property of the corporation and protect the rights and interests of its stockholders.” Edison v. Edison United Phonograph Co., 7 Dick. Ch. Rep. 620, 625, 626. In Fougeray v. Cord, 5 Dick. Ch. Rep. 185, 756, this court did not deny the power of the court of chancery to appoint a receiver pendente lite for the management of the affairs of an incorporated company organized for the purposes of trade. The ruling of this court was that “ the disturbance of corporate functions incident to a receivership are extreme powers, and may not be decreed by a court of equity when the specific acts complained of are capable of redress and complete restitution, and those apprehended fall within the ordinary jurisdiction by injunction.” The order of the court of chancery appointing a receiver in that case was set aside by this court, not on the ground of a want of power in the court of chancery to resort to the proposed mode of relief, but on the ground that, in the judgment of this court, that power was in that instance improperly exercised.

That some redress should have been afforded under the bill filed in this case is apparent from the facts disclosed in the bill and affidavits. That the vice-chancellor granted injunctions which so completely interfered with the affairs of the company as to make the conduct of its business by its officers in ordinary business methods impossible, and assumed the administration of its business affairs to such an extent as to be utterly impracticable, affords a convincing argument for such relief as is practicable through the intervention of the court of chancery under the circumstances. Such relief, we think, could be afforded only by the appointment of a receiver pendente lite.

On both appeals the injunction orders should be vacated, and the record should be remitted to the court of chancery, to be proceeded with in accordance with these views.

Collins J.

(dissenting).

While I agree with the majority of this court that the situation disclosed by the affidavits called for the appointment of a receiver on the application of either party, I also think that, pending such appointment, it was justifiable under the affidavits to order an injunction forbidding David Wolff to further act as treasurer of the corporation until he should give bonds, and restraining him from making such drafts and notes as were interdicted. Such an order might justly have been made conditional upon submission by Lazar Sternberg to like interdiction. A modified injunction of this tenor seems still unobjectionable, and may be necessary.

As to concurrence with opinion as to appointment of receiver:

Tea — Collins, Depue, Dixon, Lippincott, Ludlow, Adams, Hendrickson, Nixon, Vredenburgh — 9.

Nay — The Chief-Justice, Garrison, Gummere, Van Syckel, Bogert — 5.

To reverse and modify — The Chief-Justice, Collins, Gummere, Ludlow, Van Syckel, Bogert — 6.

For reversal — Depue, Dixon, Garrison, Lippincott, Adams, Hendrickson, Nixon, Vredenburgh — 8.

For affirmance — None.


author: Dixon, J.

text:
    Henry H. Isham, appellant, v. John W. Cooper and John W. Fowler, respondents.
    [Filed February 28th, 1898.]
    When, on the face of a written instrument, it is doubtful whether a person’s initials, written by him, were intended to witness an interlineation, or to be incorporated in the instrument as part of the interlineation, a question is presented over which a court of law has jurisdiction, and which may be decided on extrinsic parol evidence.
    On appeal from an order advised by Vice-Chancellor Emery, who delivered the following opinion :
    This is an application for a preliminary injunction to restrain further proceedings in an action at law, in which defendants have obtained a verdict against complainant, and a rule to set aside the verdict has been discharged by the supreme court. The action at law was commenced by attachment proceedings against the complainant, in which he appeared and gave bonds, and a preliminary injunction against the prosecution of this bond is also applied for. The principal question involved on this application for injunction is, whether the grounds now relied on by complainant to enjoin the collection of the judgment on the verdict were set up as defences and decided adversely to the complainant in the action at law, and in the view which I take of the case, the granting or refusal of the preliminary injunction depends upon the decision of this question. A statement of the proceedings in the action at law is necessary, in order to determine whether after the verdict of the jury the complainant still has a right to apply for equitable relief. The entire record in the suit at law, including the evidence taken at the trial, is made part of the record on this application, by complainant’s filing it with the bill, and so far, therefore, as relates to the decision of the question of the effect of the verdict at law, the entire case of complainant and defendant seems to be presented as fully as it could be on final hearing. The action at law was one of contract, and was founded upon a letter dated February 8th, 1894, written by the complainant, Henry H. Isham, to the defendants, Fowler and Cooper, signed by the complainant, proposing the terms upon which complainant would assume the management of the affairs of a corporation (the Fowler Company) of which Fowler and Cooper were officers, and which then needed financial and other assistance. By a letter of the same date, written to Isham, and signed by Fowler and Cooper, the latter accepted the terms, and the complainant’s letter and its acceptance constituted, or was claimed to constitute, a contract between the parties. At the time of the writing of the letter, certain notes for $20,000 of the Fowler Company, endorsed personally by Fowler and Cooper, were outstanding in the hands of a bank which had discounted them. The letter or contract as sued on contained a clause relating to these notes, and Fowler and Cooper claimed that this clause in the letter signed by Isham read as follows, viz.: “ That the Fowler Company notes now indorsed by you shall be renewed and reindorsed when they mature, and shall be cared for by the company and H. H. I. until the company is able to care for them itself.” They brought suit on the letter as containing this clause, and to recover the amount they had been eventually obliged to pay on the Fowler Company notes, or their renewals, being over $13,000. As appears by the pleadings, bill of particulars, and specification of defences in the cause, the dispute between the parties, so far as relates to the form of the contract, was whether this clause of the letter had been altered after its execution.
    Isham, in his specification of defences, as to this point, claimed that this clause had been altered and was not his contract, but was null and void. The clause in the letter as delivered, according to Isham’s claim, was as follows (including the interlineations as actually made):
    “That the Fowler Co. notes now indorsed by you to the extent of §20,000, shall be renewed and reindorsed when they mature, and shall be cared for the company and by (H. H. I.)
    by you until the company is able to care for them itself.” /\

      And the alteration claimed consisted in the erasure of the word “ you ” after the carat. In this specification of defences, it will be observed that the initials “H. H. I.” were included in a parenthesis placed at the side of the sheet, and not immediately following the words “ and by,” but there was no claim in the specification of defences that the initials were intended to indicate an alteration, or that by mistake the initials were so placed in the letter as to admit of being read into the text as part of the letter or contract. In the letter itself, these initials in fact immediately followed the word “ by.” On the trial of the cause, it appeared by the undisputed evidence on,both sides .that the disputed clause of the letter as originally written by Isham to Fowler and Cooper read, the notes “ shall be cared for by you,” without any interlineation or erasure. It was also shown by the evidence on both sides that alterations were made in the letter at the interview held immediately after the receipt of it by Fowler and Cooper, at which interview Isham, Fowler, Cooper and also Judge Gilhooly, the counsel of the company (and no others), were present. The main question of fact at the trial at law was as to the alterations which were then made in the letter in the presence of’ all these parties. Mr. Isham and Judge Gilhooly testified as to the conversation, previous to the alterations, and as to the purpose of making the alterations, which were then declared, and as to the alterations actually made after these conversations, for the purpose of carrying out the changes in the letter which were agreed on. Mr. Isham and Judge Gilhooly testified substantially that the alteration, and the only alteration in the letter itself, was the interlineation of the words “the company and by” after the word “by,” and before the word “ you,” so that the letter as altered read, the notes shall be cared for “by the company and by you” (Fowler and Cooper). They both further stated that this alteration was actually made by Isham himself, after the conversation between the four persons, in reference to making alterations in the letter, and that the alteration thus testified to was the only alteration to be made in the letter itself. As to the initials “ H. H. I.,” these two witnesses stated that these were made after the alteration of the letter had been made as agreed on, and that the initials were added by Isham, at the suggestion of Judge Gilhooly, solely for the purpose of noting or identifying the interlineation. This suggestion, they stated, was made in the presence of both Fowler and Cooper, and Isham then, in their presence, added the initials immediately following the words “ and by,” in the interlineation previously made, and delivered the letter to Fowler and Cooper, the letter at the time of delivery, according to their statement, containing the word “ you,” after the carat, unerased. Fowler and Cooper, on the other hand, after having given a different account of the conversation preceding the actual alteration, and of the object of the alteration, said that the entire alteration in its present form, including the initials, was written by Isham at once, who, at the same time, erased the word “ you,” and that the letter was delivered to them in the form in which it now appears. Cooper’s statement in his direct evidence, as to the object of the alteration, was that he said to Isham, “ I want something specified there to show that you are to take care of that paper when it comes due,” and that then, after a question to Judge Gilhooly, Isham wrote in the interlineation, “ to be cared for by the company and H. H. I.,” and scratched out the word “you.” On cross-examination, being asked as to the language of his objection to the letter, he stated, “I wanted Mr. Isham to take care of that note, and wanted something put in that instrument so that he would take care of it;” and that Judge Gilhooly did not, as he remembers, say anything after the alteration had been made by Isham, except that it was all right. Fowler’s statement on this point is substantially similar. No objection was made on either side to the admission of the evidence relating' to the circumstances under which the initials were written, or to the object of writing them. Nor does the attention of the court or counsel on either side seem to have been specially directed during the taking of the evidence to any supposed objection that, in a court of law, the initials H. H. I. must be read into the .contract, as a part of the contract, independent of the intention of all the parties in their insertion, or to any objection that for the correction of a mistake in so locating the initials that they might be read as part of the contract, instead of a mere notation of an interlineation, the remedy of the defendant was to apply to a court of equity to correct the mistake. On the contrary, the statements of the four witnesses were received as to the entire transaction, relating to the alteration of the contract, and the intentions with which all the alterations were made, and the initials were placed on the paper. In charging the jury, the learned justice (whose charge is set out in full on the record) stated that the disputed question between the parties was what alteration was made ; and after giving a statement from the plaintiff’s evidence, substantially as above, gave Judge Gilhooly’s statement of the entire alteration, as follows: “Then Isham took his pen and interlined the words ‘ the company and by,’ making it read ‘ by the company and by you.’ ” Judge Gilhooly then suggested that Isham should put his initials, H. H. I., to witness the alteration. Isham substantially testifies in the same way. Fowler and Cooper as positively assert that Isham agreed to be responsible for the note, and that Isham then wrote in the interlined words as they now appear, and also erased the word “you.” The plaintiffs say Isham did alter it as it now is. Isham says he did not. The question is, “ which statement will you accept under the evidence?” The justice, after calling attention to the special facts appearing in the case, bearing upon the main issue, then said that all these and the other evidence in the cause must be considered, and that the jury must settle “ whether you will accept the evidence on the part of the plaintiff or that on the part of the defendant.” The complainant’s counsel do not claim that up to this point the rules of law, as laid down by the justice at the trial, required the jury to read the initials H. H. I. into the contract, as part of it, but they insist that this was the effect of a subsequent refusal to make a special charge which they requested him to make. The defendant requested the judge to charge “ that if the jury shall be satisfied from the evidence that the initials II. H. I. were inserted in the letter of February 8th, 1894, for the purpose of noting an interlineation, then the plaintiffs are not entitled to recover in this action.” This charge was refused, not in absolute terms, but refused “ except as charged,” and to this an exception was taken. On the application for a new trial, it was claimed in reference to this refusal, that it was an error of law, for the reason that whether the word “ you ” was crossed out by Isham or not, he could not be held unless the initials were written as part of the text. In reference to this, as well as the ether legal points raised, no error was found by the supreme court, and the rule was discharged. The complainant claims formally by his bill, that this refusal to charge, “ in effect declared that that purpose for which complainant’s initials H. H. I. were inserted, could not be considered in a court of law,” and that by reason of this ruling, affirmed on application for new trial, complainant’s defence, arising out of this alleged mistake in placing his initials where they could be read into the contract, was in fact overruled as an equitable defence not admissible at law. This overruling of an equitable defence, not available at law, is the special equity upon which complainant applies to a court of equity, notwithstanding the verdict, for reliefj and on the general jurisdiction of a court of equity to reform mistakes in written instruments. The affidavits to the bill and the answer under oath, so far as relates to the circumstances of the alteration, and to the statements made as to the object of the insertion of the initials in the letter, present substantially the same case on each side as presented at the trial at law, except possibly in the following particular: In the affidavits to the present bill, it is stated by Isham that there was no margin to the paper in which to place the initials, and that they were underscored by him with the object of parenthesizing them. In the evidence at the trial I have not found this statement of the reason of the location of the initials, or of the underscoring, given by either Mr. Isham or Judge Gilhooly. This is, however, a matter of detail, and so far as relates to the facts at issue, the defendants here place themselves substantially upon the same ground taken by them in the suit at law; and they set up specially by their answer that the verdict and proceedings at law are conclusive upon the facts now in issue on this bill, and pray the same benefit thereof as if the verdict and judgment had been pleaded. In relation to obtaining the benefit of a former adjudication, our practice, as I understand it, permits the defence to be raised by answer as well as by a formal plea, following in this respect the general rule of the American courts. Lyon v. Talmadge, 14 Johns. 501, 511; Black Judg. § 783.

    And the defence of former adjudication being in its very nature a preliminary question in the cause, which should regularly be disposed of before proceeding to examine the evidence anew on the merits, the proper practice would seem to be, that where this preliminary question on the record is ripe for decision, on the application for preliminary injunction, and no special reason appears for reserving the decision of the question until final hearing, the question should be disposed of as a preliminary question on the motion for preliminary injunction. This was the course taken by Chancellor Williamson in Brown v. Lexington and Danville Railroad Co., 2 Beas. 191 [1860). An injunction was here dissolved on motion upon the ground (among others) that the claims and issues involved in the cause had been virtually decided in a prior suit between the parties in another state. The judgment in that case was obtained in another state, and had not been formally pleaded as a bar, but it appeared on the record, and Chancellor Williamson says (at p. 196), “ this court, sitting as a court of equity, ought not to permit a party who has had his rights fully investigated and decided in a court of equity in another state to avoid a final decision in that tribunal, and to raise the same questions upon the same facts, and to ask a reinvestigation at the hands of this court.” He, therefore, considered the question of res adjudieata on motion to dissolve injunction, and dissolved the injunction and dismissed the bill upon this ground. If a preliminary injunction in the present case would, under this practice, be dissolved on motion and the bill dismissed it would seem to be clear that no preliminary injunction should go, but that the application should be refused. So far as relates to the effect of the verdict, the ease has been fully presented on both sides, and in view of the fact that the entire proofs, which would be relevant to this point on final •hearing, seem to be presented on this application as fully as they would be presented on final hearing, it is a case where, in the interests of all parties, this preliminary question should be disposed of on this application instead of deferring decision upon it until final hearing, where it will still remain as the preliminary question after the taking of evidence on the issues. This course will also probably enable the parties, with the least delay, to obtain a decision on appeal on this preliminary question. I will therefore proceed on this application to consider and dispose of this question on this application. Where the defence is clearly an equitable one, which could not be made available at law, it is entirely settled that a court of equity can relieve against a verdict obtained purely on the legal liability. Cairo and Fulton Railroad Co. v. Titus, 12 C. E. Gr. 102, and cases cited, p. 106, approved on this point on appeal, S. C., 1 Stew. Eq. 269, 270; Holmes v. Steele, 1 Stew. Eq. 173, 176; Smalley v. Line, 1 Stew. Eq. 348, 352 (Chancellor Runyon, 1877). Borcherling v. Ruckelhaus, 4 Dick. Ch. Rep. 340 (Errors and Appeals, 1892), also decides that where the defence offered at law is overruled at the trial as being in fact an equitable and not a legal defence, the verdict and judgment is not an estoppel to a bill based on the equitable defence to be relieved against the verdict, and that the ruling of the court of law at the trial may be accepted as final on the question of its admissibility at law, without taking the review of a higher court on exception and •error. The ruling of the trial judge, which is here relied on as having the effect of overruling the equitable defence offered by •complainant, was sustained on review by the higher court, and must therefore undoubtedly be taken as the law of the case. The crucial question in the case, however, is whether this refusal to charge, so sustained, can, under the circumstances of the trial shown by the entire evidence and charge, be fairly construed to have been a ruling that in a court of law the initials must be read into the contract as part of it, or to have overruled the defence set up that the initials were so placed by mistake. This alleged mistake in the location of the initials is the only equitable defence or claim on which an injunction can now be based. For although a court of equity may have jurisdiction to declare-an instrument forged, and to order it to be delivered up—Peake v. Highfield, 1 Russ. 559, and cases cited [Gifford, M. R., 1876)—yet the issue of forgery is generally sent to a jury in such cases, and in this case the verdict of the jury is plainly final in favor of the plaintiffs on the question of forgery, which can, as it seems to me, no longer be controverted either alone or in connection with the question of the mistake.
    Proceeding, then, to the consideration of the question whether the equitable defence of mistake in locating the initials was overruled by the refusal to charge, it is clear as a starting point that it was not in terms a ruling to the effect that the initials must in the court of law be read into the contract as part of it, and that the question of the intention of placing them could not be-admitted. No such claim is made, nor can it be claimed that any such rule of evidence was applied at all in this case, or that the complainant was prevented in the trial at law from giving as fully as he has here given on his affidavits to the bill his-entire case as to the identity of the paper signed, and as to his-intentions in placing his initials upon the paper, as well as in relation to the erasure, and in refusing to charge the justice did not refuse absolutely, but only refused “except as he had charged,” thereby against giving to defendant the benefit of his-evidence on this point. This refusal, as it seems to me, certainly was not intended by the justice as instructing them that they must read the initials into the contract, notwithstanding the-defendant’s evidence. I do not think it could have been so-interpreted by the jury, nor does it seem to have been presented by counsel to the supreme court as having that effect.
    The objection to this ruling as there taken by the briefs of counsel, which have also been submitted to me as part of the-record to be considered on this application, was that by the refusal the justice failed to give to defendant the benefit of a-ruling to which he was entitled; viz., that he could not be held unless the initials were read into the contract, whether the-erasure of the word “you” was afterward made or not, and that by this refusal the effect of the erasure was thereby magnified, and the jury misled. But it was not at all claimed by defendant’s counsel in the briefs that the ruling had the effect now insisted on of requiring the jury, in a court of law, to read the initials into the contract without regard to the evidence of their intent and purpose. In reference to this refusal to charge, no error was found by the supreme court, but no opinion was filed, so that there was no express adjudication or ruling by the supreme court that the refusal to charge had the effect now contended for, or that if so construed it properly declared the law. There is, therefore, on the record of the case at law nothing to show that the rule of legal evidence, now claimed to have been applied, was expressly laid down, either at the trial or by the supreme court, and even on the assumption that this court is entitled in this case to infer or deduce such reading, in the absence of an express declaration to that effect by the court of law, it is certain, I think, that such deduction or inference must appear to be fairly warranted on a consideration of the -whole case on the point in question as presented at the trial. Upon such consideration I do not think the ruling in question, or its affirmance, can be considered as having the effect now claimed. Considering the present application in its entire scope appearing from the record the complainant’s situation, stated in its most favorable aspect, seems to be as follows: He -was sued at law upon a written instrument, in relation to which he had two defences — mistake in locating his initials in one portion of the contract, and alteration after execution of another portion. Without applying to a court of equity to take jurisdiction as to defence of mistake, either alone or as drawing to it also the jurisdiction to direct a delivery up of the altered instrument, he set up at law on the record the single defence of alteration. The case as presented by both sides at the trial was one in which the direct evidence on the two points of initials and erasure was necessarily intimately connected and interwoven — and defendant’s evidence produced at the trial embraced all of his direct evidence relating to mistake as well as to alteration, which was received without objection, and the jury were clearly directed by the trial justice that if the evidence for defendant was believed no action at law was sustainable. The justice refused to direct the jury that defendant’s evidence as to mistake, if believed, created a primary and separate cause of defence, independent of the defence of alteration, but did not withdraw the defence of mistake in connection with the defence of alteration, as one entire defence, from the jury; and, on the contrary, again expressly instructed them to find in favor of the defendant to the action if his statements as to the execution of the instrument (which included both mistake and alteration) were believed, the jury found a verdict against defendant, and on review of this verdict complainant claimed that the defence of mistake was a separate and primary defence to the full benefit of which defendant was entitled, and that the trial judge by the refusal to charge had deprived him of the benefit of this defence to this extent. The court on review found no error at law or misdirection in the manner of submission. The complainant now applies for equitable relief against the verdict, on the ground that the defence of mistake was overruled at law. The relief in equity must be granted, if at all, by the trial separately of the defence of mistake, for as to the defence of alteration the verdict of the jury is clearly final and conclusive. If this be the correct statement of the case, then, as it seems to me, it is clear that the present application to equity is really based, not on the fact that the defence of mistake was overruled at law as being an equitable defence only, but that the trial court, after admitting the defence as a defence at law, failed to give it the full separate effect to which the defendant in the action claimed it was entitled in this particular case, when once admitted as a defence in the court of law. The court, on review, held that this course was not erroneous at law, but did not declare that the evidence relating to mistake was not admissible at law, and on the whole case refused to disturb the verdict. To grant now in equity a retrial of the case solely upon the separate defence of mistake would be, as it seems to me, a review of the correctness of the decision of the supreme court as to the manner in which the defence of mistake, when once admitted in a court of law, should be treated in connection with other defences, rather than an instance of exercising the undoubted jurisdiction of a court of equity to sustain an equitable defence which is not admissible and has been overruled at law.
    The defence of mistake in this particular case has been by the conclusive action of the court of law substantially held to be a defence concurrent at law and in equity, and it has been admitted as such.
    The treatment of this defence by the court of law after admitting it as a legal defence may be ground of error, but cannot be ground of retrial of the defence in equity for the purpose of correcting this supposed error of the court of law. I am of opinion, therefore, that the only question of fact which can now be relied on as a basis of equity jurisdiction has been substantially tried in a court of law, and the verdict is final upon this court so far as this question is concerned.
    The application for preliminary injunction is therefore refused, and the order to show cause is discharged.

      Mr. Joseph Cross and Mr. Charles L. Corbin, for the appellant.

      Mr. Richard V. Lindabury, for the respondents.
   The opinion of the court was delivered by

Dixon, J.

This is an appeal from an order of the chancellor refusing to grant a preliminary injunction to restrain the defendants from enforcing a judgment, which they had obtained against the complainant in the supreme court of this state.

The judgment was based upon a contract which, it was claimed, the complainant had made by placing his initials upon a written document. The bill alleges that the complainant placed his initials there, not for the purpose of contracting, but only to attest an interlineation then made upon the instrument; that his placing them in such a position as to lead a court of law to read them into the contract, was the result of inadvertence and mistake, from which the court of chancery should give him relief. The answer avers that, in the trial at law, upon which the judgment was rendered, the complainant likewise insisted that he had placed his initials upon the instrument, not for the purpose of contracting, but merely to attest the interlineation, and relied upon that proposition of fact as a legal defence to the suit; that the trial court accepted the proposition as a legal defence and submitted its truth to the jury, who, by their verdict, found it to be untrue; and the defendants thereupon insist that the fact is res judicata against the complainant, and cannot be retried in equity.

In response to this, the positions of the complainant are, first, that the question of fact was not tried at law, and second, that even if it was, it' presented an issue over which a court of law had no jurisdiction, and hence the decision of that court is not binding upon him.

As to the first position it must suffice to state that, after examining carefully the evidence submitted on the motion for injunction, including the proceedings on the trial at law, we think the averments of the answer are substantially correct.

As to the second position, it is not now necessary to decide whether, when at the instance of a defendant, a court of law has received a proposition of fact as a legal defence, and because of its untruth has rendered judgment against him, a court of equity should, at the instance of the same party, determine for itself whether the proposition was admissible as a legal defence, and, if it answers that question in the negative, should interfere with the judgment, because the proposition, if true, constitutes an equitable defence, for the order under review can properly be supported on the ground that the proposition set up in this case was, if true, a legal defence.

In Kean v. Davis, 1 Zab. 683, Chief-Justice Green, delivering the opinion of this court, sitting as a court of law, declares that the cases “fully establish the principle that when it is doubtful on the face of the instrument whether it was designed to operate as a personal engagement of the party signing it, or otherwise, parol evidence is admissible to show the true character of the transaction ; ” and upon that principle this court reversed a judgment, because, at the trial in a law court, evidence offered by the defendant to show in what capacity he had written his signature upon the instrument, was rejected.

An inspection of the writing now in controversy satisfies us that it is doubtful on the face of the instrument whether the complainant’s initials were written by him for the purpose of binding him to a contract, as the defendants claim, or for the purpose of attesting an interlineation, as he claims.

The initials appear in the body of a letter addressed by the complainant to the defendants, and the important words are written as and by (you) H. H. I. follows: “and shall be cared for by the company until,” &c.

On the suggestion being made, the probability is perceived at once that the initials may have been written with either intent, and which actually existed must be decided on extrinsic evidence. No doubt, in reaching a decision, the mind would be strongly influenced on ascertaining whether the word “you” was crossed out when the initials were written or afterwards, but this latter question would not be the same question as the former; it would be only subsidiary, and we think it was so treated at the trial.

Our conclusion is, that the question of fact between these parties was submitted by them to the appropriate tribunal, and its judgment thereon precludes further controversy.

The order appealed from is affirmed.

For affirmance — The Chief-Justice, Dixon, Garrison, Gummere, Lippincott, Ludlow, Van Syckel, Adams, Bogert, Hendrickson, Krueger, Nixon, Vredenburgh — 13.

For reversal — None.


text:
    Henry C. Loudenslager, appellant, v. Woodbury Heights Land Company, respondent.
    [Filed March 7th, 1898.]
    On appeal from a decree advised by Vice-Chancellor Pitney, whose opinion is reported in Woodbury Heights Land Co. v. Loudenslager, 10 Dick. Ch. Rep. 78.

      Mr. Samuel H. Grey, for the appellant.

      Mr. David J. Pancoast and Mr. Howard M. Cooper, for the respondent.
   The opinion of the court was delivered by

Dixon, J.

The judges who vote to affirm the decree in this case approve of the reasons given therefor by the learned vice-chancellor who advised the decree. But since in his written opinion he left open the question whether the decree should be for the whole profit ” made in the transaction which was the subject of controversy, or only for one-half thereof, and the decree signed is for the whole, it is incumbent on us to state further our reasons for maintaining this feature of the decree.

The claim that the defendant should be held for only one-half of the profit is based upon the evidence that, by the original arrangement between the defendant and Joseph B. Roe, the latter was to have one-half of the profit, and that before this suit was brought the defendant had paid to Roe his share.

We think that Roe’s position with respect to the lands embraced in the options, and also his relations to the complainant, were the same as the defendant’s, and that he could not be permitted, in equity, any more than could the defendant, to make a profit out of the sale of those lands to the complainant, unless the circumstances were fully disclosed to the complainant.

Therefore, when the defendant had received from the complainant the whole ostensible price of the lands, and had thus become bound to restore to the complainant the difference between that and the real price, he could not, and did not, lessen his responsibility by paying over part of the money to one who had no more right to it, as against the complainant, than he himself had.

To reverse and modify — Depue, Garrison, Bogert, Hendrickson, Nikon — 5.

For affirmance — The Chief-Justice, Collins, Dixon, Lippincott, Van Syckel, Adams, Vredenburgh — 7.

For reversal — Gummere, Ludlow — 2.