text:
    In the matter of the account of Calvin Corle, executor of Peter W. Young, deceased.
    [Filed April 18th, 1901.]
    1. A testator gave to his executor in trust $1,000, the interest thereof, less the taxes, to be applied to keeping his burial plot in O. graveyard in good order, and any surplus remaining, to be used to repair fences around the graveyard.—Held, void as an attempt to create a perpetuity, being neither a charitable bequest nor a gift to a cemetery association within Gen. Stat. p. 351 § H, empowering incorporated domestic companies or associations to take and hold property given in trust, and to apply the income thereof for the improvement, repair and embellishment of such cemetery.
    2. Where an executor’s final accounting was delayed by litigation, and he derived no benefit from the retention-of money held for the payment of a legacy subsequently declared invalid, meanwhile making all requested advances to exceptant, he is not chargeable with interest for failure to invest such money pending final settlement.
    On exception to account of executor.

      Mr. William J. Baches, for the respondent.

      Mr. Alvah A. Glarh, for the executor.
   Reed, Y. C.

Peter W. Young died March 8th, 1887, leaving a will, of which he made Calvin Corle his executor, and by which he gave his estate to his widow for her life, and, after her death, gave bhe remainder of his personal "property, after paying debts and certain legacies, to Lydia Y. Monkhouse. The widow died February 26th, 1888. On May 15th the executor filed a bill for the construction of certain parts of the will. He filed a partial account November 18th, 1890, to which exceptions were filed. All of these exceptions but one were adjusted, and on September 18th, 1892, he was permitted to amend his bill - by asking that the account should be settled in this court. On October 20th, 1896, an order was entered directing the executor to file his account here. On November 18th, 1896, he filed his final account. In it he prays allowance for $1,000 on account of a legacy to Cloverhill Church. To this an exception was filed. A second exception was filed because he had not charged himself with interest upon this $1,000.

The allowance for the amount of this legacy was irregularly claimed in the account. It should have been claimed when the order for distribution came to be made. But a desire to get the opinion of the court upon the validity of the legacy, and as no objection was taken upon this ground, I will proceed to express my views upon the application and right of an executor to pay this interest.

The language in which this legacy is given is this:

“I give to my surviving executor in trust $1,000, to be invested on bond and mortgage, the interest thereof, less the taxes, to be applied for keeping my burial plot in the graveyard at Cloverhill Church in good order. But, if in the judgment of my executors it did not require all the interest, less the taxes, to keep it in good order, then whatever may be remaining to be used towards keeping in repair the fences around the said graveyard.”

This legacy, unless saved by the act of 1878 (Gen. Stat. p. 351 § 14.), is void, as an attempt to create a perpetuity. Detwiller v. Hartman, 10 Stew. Eq. 347; Hartson v. Elden, 5 Dick. Ch. Rep. 522; Moore’s Executors v. Moore, 5 Dick. Ch. Rep. 554. Nor can I see how the direction to keep up the fences around the graveyard can be regarded as a charitable bequest. In Hartson v. Elden, supra, the remainder of the interest of $5,000 was to be used in the general improvement of the cemetery; yet the whole bequest was held to be void. The question therefore arises whether the trust is validated by the act of 1878. This act empowers any incorporated domestic cemetery company or association of this state to take and hold property given or bequeathed in trust, to apply the income thereof, under the direction of the trustees and managers of such association, for the improvement and embellishment of such cemetery, or the erection or preservation of any buildings, structures, fences, walks, erected or to be erected upon the lands of such cemetery association, or for the repair, preservation, erection or renewal of any tomb, monument, gravestone, fence railing ox other erection in or around any cemetery lot or plot, &c.

The gift in the will in question is to the executor, and not to the cemetery association.

By the express direction of the advisor, the executor, and not the association, are to hold the legacy in trust. By the same expressed testamentary direction, the interest is to be spent under the direction of the executor, and thus any control or direction of the trustees or managers of the association is excluded.

I am constrained to the conclusion that the bequest is not saved by the terms of this statute.

In respect to the interest upon this amount, the exceptant does not stand in the same attitude as the beneficiaries of the legacy would have stood had the bequest been-valid.

She insists that this amount was a part of the residuum,, and the executor’s duty must be measured by what he failed to do if this were a part of the residuary estate.

He received no personal benefit from it, for he swears that neither by the reception of interest or by using it in his business was he bettered by it.

The accounting was delayed by litigation. The last outstanding interest-bearing mortgage was collected in by the advice of exceptant’s own lawyer.

Money was advanced to exceptant as she called for it. • I do not think that he should be visited with an imposition of interest for a failure to invest pending the final settlement.

The first exception is sustained and the second disallowed, without costs.


source: Caselaw Access Project

author: Emeby/V. C.

license: Public Domain

text:
    Alexander P. Baldwin et al., executors, &c., of Joseph Baldwin, deceased, v. Mabel C. Tucker et al.
    [Filed February 28th, 1901.]
    1. A will providing that all the rents, interest and profit of testator’s estate shall be paid to his widow during life, and directing the interest s6 accrued to be equally divided among testator’s children on the death of the wife, is sufficient to pass the corpus of his personal estate to his children on the death of the wife, there being no limitation of time as to the continuance of the bequest of interest and no express disposition of the principal.
    2. Where executors have no interest in testator’s real estate, except a power of sale, the operation of the will on such real estate will not be construed in an action brought therefor by the executors, where the right of sale is not in issue.
    3. Where a child of testator dies before the latter, the children of the former are entitled to share in his estate under a provision in the will that on the death of testator’s wife his property is to be equally divided among his living children or their heirs.
    On bill, answers, replication and proofs.

      Mr. Frederic B. Pilch, for the complainants.

      Mr. Joseph A. Beecher, for the defendants Baldwin and Martin. ■

      Mr. Henry V. Gondict, for the defendants Reid and others.

      Mr. Francis J. Swayze, Mr. Albert G. Pedrick, and Mr. George W. McKenzie (of the New York bar), for the defendants Barclay and others.
   Emeby/V. C.

This bill, filed by the executors of the will of Joseph Baldwin for instructions in the distribution of his personal estate, under his will, raises two question for decision:

First. Whether testator died intestate as to the remainder of his personal estate, in which his' wife was given an interest during widowhood, which life estate has terminated by her death, and

Second. If he did not die intestate, then whether, under the clause of his will which disposes of this remainder of his estate, the children or issue of one of the four children of the testator, who died before the date of the will, receive one-fourth of the estate, or whether the estate is to be divided into three shares between a son and daughter of testator, living at the death of the tenant for life, and the children of a daughter who, though living at the date of the will, died before the termination of the life estate.

As to the 'first question: The will, after directing testator’s debts to be paid and appointing executors, bequeathed to his wife a farm in Minnesota and his household furniture in fee, “and also, for the time she shall remain my widow, all rents, interests and profits into and out of my estate,” excepting certain property, on Market street, Newark, devised to a son and daughter, from which she was to receive certain quarterly payments during her life. The executors were then authorized to sell all other property of which testator might die seized, at their discretion, the proceeds of sale to be invested in unencumbered real estate, sufficiently productive “to pay interest, &e., so accruing to his wife during life.” Next follows the only provision in the will as to the disposition of his estate after the death of his wife, in these words:

“At the death of my said wife the intest so aerwmg shall be paid eaqually to my living children, or their heirs, share alike—the children receiving the share coming to my children.”

It will be observed that the corpus of the estate, as distinct from the interest or income, was not, expressly and in plain terms, disposed of by this clause, and the question is, whether, considering the bequest to be merely of the interest or income of the estate, which had been previously given to the wife for life, such bequests of the interest, being without limitation as to time, is to be construed as effecting a bequest of the corpus to the persons who are legatees of the interest. Upon this point the decisions of our courts have established the rule that a bequest of the interest of personal estate, without any limitation as to continuance, is a gift of the corpus which produces the interest. Craft v. Snook, 2 Beas. 121 (Chancellor Green, 1860); Gulick v. Gulick’s Executors, 12 C. E. Gr. 498 (Errors and Appeals, 1875); Hartson v. Elden, 5 Dick. Ch. Rep. 522 (Chancellor McGill, 1892), and cases there cited at p. 524- This settled rule of construction controls this case, so far as relates to the personal estate. Whether the bequest of the “interest so accruing” is to be construed as including the rents and profits of real estate, and whether, if so, a devise of the rents and profits, without limitation, but without other words, is sufficient to create a fee in the devisees, are questions which cannot be considered on this bill. The executors here have no estate or interest in the lands, but only a power of sale, and the jurisdiction of the court, on a bill of this character, in which the question of the existence or exercise of the power of sale has not been raised or presented, extends only to the directions to the executors, as trustees, holding personal estate for distribution. This question of jurisdiction as to the real estate was considered and decided adversely by me in Robeson v. Shotwell, 10 Dick. Ch. Rep. 318, 328 (1897); affirmed on appeal for reasons stated, Ibid. 824; and also in Nelson v. Nelson, 12 Dick. Ch. Rep. 118, 122 (1898). Treating the clause above referred to as an effectual disposition of the corpus of the residuary personal estate, the second question is as to the legatees who are, under this clause, intended by the testator to take the personal estate. The direction of the testator is:

“At tlie death of my said wife, the interest so accruing shall be paid equally to my living children, or their heirs, share alike—the children receiving the share coming to my children.”

At the date of the will, April 2d, 1870, the testator had three children living—one son, Alexander P. Baldwin, and two married daughters, Mrs. Emily E. Martin and Mrs. Mary Russell Reid. Another married daughter, Mrs. Margaret A. Barclay, had died in 1866, four years before the date of the will, leaving five children, who survived her and who were living at the date of the will. Three of these children of Mrs. Barclay, the deceased daughter, survived the tenant for life, two died during the lifetime of the tenant for life, each of these two leaving-one child, now living and infant defendants in the suit. Mrs. Reid, one of the daughters, who survived the testator, died testate,, in 1885, and before the death of her mother, in 1897, leaving four children her surviving. On behalf of the surviving son and daughter of the testator and of the legatees of Mrs. Reid it is claimed that, under the above clause, the children of the daughter who was dead at the date of the will do not take anything, and that the estate is to be divided among the children of the testator living at the date of the will (or of testator’s death) and the children of a child then living.

It is insisted on their behalf that the clause in question is a primary or original bequest to testator’s children living at the date of the will (or of his-death) as a class, and that the bequest to “their heirs” was a subsequent bequest by way of substitution only to the heirs of this class of children in case of the death of any member of this class before the time of distribution, and that no heir of a child of testator can take by way of substitution, unless the parent for whom they are substituted was himself (or herself) intended to take, and capable of taking, as a member of the class of primary legatees. And it is claimed, therefore, that inasmuch as a child who was dead at the time of the will could not be intended as one of the testator’s “living children,” or “children,” at the date of his will (or of his death), the heirs or children of such child, dead at the date of the will, cannot take as substituted legatees. Upon the other hand, it is claimed that the bequest of the testator, “at the death of my wife, to my living children or their heirs,” &c., refers to children of testator living at the period of distribution (the death of the wife) or the heirs of any of testator’s children then dead, and is an original and primary-gift to two classes of legatees—the first being the children of testator living at the time of distribution, and the second class being the heirs of children of •testator then dead, and that this second class includes the issue of all of testator’s children who were then dead, as well as of the child deceased at the time of the will, as those of the children then living, but who died before the period of distribution. As to the period of time which was in testator’s mind in this gift ti> “living children,” an indication is given in the circumstance that the bequest he intends to make commences with a reference to one period of time—that of his wife’s death-—and the words now claimed to indicate another period occur in the same clause, and can just as naturally be supposed to refer to the period which was certainly in his mind at the commencement of the bequest. He says, "At the death of my wife“ the estate “is to be paid equally to my living'children,” &c. Erom this connection of the time when the gift was to be enjoyed, with the description of the class of legatees who were to take, and from the absence of any expressions certainly indicating that another time was intended in the description of the legatees, it would seem the most reasonable, if not the only, conclusion that the testator had in his mind, as the “living children” who were to take, the children living at the period of time which was in his mind and which was fixed by his words as the time when they were to take, viz., the time of the wife’s death. Upon this branch of the case, the question is whether the testator, by the use of the words “my living children,” intended “my [now] living children,” referring to the date either of his will or of his death, or whether he intended “my [then] living children,” referring to the date of distribution. It is more reasonable, I think, to conclude that only one period of time was intended by the words used throughout the whole clause, if such construction gives a natural meaning and' application of the word “living,” than to construe the word “living” used as descriptive to refer to another and different time, because such other reference may be inferred from the descriptive word itself. The failure of the testator to indicate clearly, by any other expression, that another or different period was in his mind in the use of the descriptive word, is, in my judgment, decisive against the right to give this effect to the word “living,” which is, of itself, ambiguous upon the point now considered. I hold, therefore, that by the gift of the estate “at the death of my wife to my living children, or their heirs,” &c., the testator meant to designate children living at the death of his wife. Assuming this is to be the proper construction of this clause, the next question is, whether the testator intended original and primary bequests to two classes of persons—the children living at the wife’s death as one class, and the heirs of children then deceased as another. I think two classes of legatees were intended. The clause which seems to me to be convincing, if not conclusive, on this point, as to there being one or two classes, is the direction made by the testator himself as to the manner of the distribution. The division is to be “to my living children or their heirs, share alike—the children receiving the share coming to my children.” This last clause can only mean that the children of my deceased children receive the share which would be coming to my children, if living, and contemplates, clearly, that the children of the deceased children are to take, or may take, in conjunction with the living children, and take as an immediate gift to them, at the death of his wife, if the parent be then dead. By share “coming to my children” the testator must mean the share that would be coming to my children, if living, at the time of my wife’s death, under the previous devise to living children. And the insertion of the clause relating to the manner of distribution per stirpes at the wife’s death, shows, I think, that the testator did not contemplate an immediate gift in remainder from the date of his will to his children living, either at the date of his will, or at his death, but a division at his wife’s death between his children then living (contingent on their surviving his wife) and the heirs or children of his children who were then deceased. If this be the- true construction, and there were two classes of legatees, who were thus to take at the wife’s death, the next question is, who comprise the second class—the “heirs” of children then deceased? Are “heirs” of children who died in testator’s lifetime included, or only heirs of children who died after the testator and before distribution ? Upon this question, which was the main point in the cause, upon which counsel on both sides submitted an exhaustive collection of cases, the special form of the bequest of the will must always be kept in mind, as a guide in the labyrinth of cases. The gift to heirs or children is here made in the same clause with the gift to the parent; it is a single gift, to “my living children or their heirs,” and the case therefore differs from that class of cases in which the clause under which the heirs or issue take is made in a subsequent independent clause, which is, in form, apparently a substitutionary bequest only. Hnder the form of bequest now in hand, the special questions which arise are whether “or” is to be read as conjunctive and not as alternative, and whether the words “or their heirs,” after a gift to children living at the date of distribution (as I conclude this to be), include the issue of all the children then dead. There is, in the whole will, no indication, except by this clause, • that the testator intends to make a distinction between the heirs of his different children merely because of the date of their parent’s death. The distinction between the heirs of different children is based solely on the words used in this clause, and it rests, finally, if it exists at all, upon the conclusion that the testator, in thus describing his children living at the time of his wife’s death, or their heirs, intended to exclude the heirs of children deceased at the time of the will. A construction of the will as making such exclusion was described by Sir George Jessel, In re Smith’s Trusts, 5 Ch. Div. 197 note (1877), as imputing to the testator a capricious intention to make a distinction between the heirs of his children, depending solely on whether they died before or after him. The absence of any indication elsewhere in the will of the express intention to discriminate, has always been given weight' in the construction of clauses which are claimed to create it, but which admit of a construction equally natural and reasonable which does not create the distinction. Outcalt v. Outcalt, 15 Stew. Eq. 500, 501 (Chancellor Runyon, 1887). In the absence of indications of intention to discriminate between the heirs of different children, merely by reason of the dates of their death, and in cases where the form of bequest resembles the present, the rule established by the weight of the authorities, as well as upon principle (so far as any rule of construction can have weight, in the ascertainment of the meaning of the words used by the testator in the particular will to be construed), is the one stated by Theob. Wills (1th ed.) 510, as the result of the cases :

“A gift to children living at the period of distribution, or their issue, will be construed as a gift to the children then living, and the issue of those then dead, including the issue of those dead, at the date of the will, but not, it would seem, of those who were dead befor testator was born.”

He also says {Ibid.): “If there is anything to show that the original and substituted classes are to take co-ordinately, 'or’ will be read ‘and.’ ” In the following English cases, cited by Theob. Wills, supra, being some of those referred to by counsel, the gifts to the heirs were, as here, by a single clause, the word “or” was read as conjunctive, and heirs of children were held to include the heirs of children dead at the date of the will. In King v. Cleaveland, 26 Beav. (Romilly, M. R., 1858), the bequest was to the children of testator’s brother, or their legal representatives. In re Philips’ Will, 7 Eq. 151 (Romilly, M. R., 1869), the direction was after the death of testator’s wife, to divide a sum among his children then living, or their heirs. In re Sibley’s Trusts, 5 Ch. Div. 494 (Jessel, M. R., 1877), a leading case thoroughly discussing the question as to how far authorities aid decision in this class of cases, there was a gift of real estate to A. for life, and then, in trust, to sell and hold proceeds for all and every the children of F., or their issue, in equal shares. In other cases of bequests by a single clause the word “and” was used in a single clause, instead of “or,” but “children” was construed as including the children dead at the date of the will. Clay v. Pennington, 7 Sim. 370 (Vice-Chancellor Shadwell, 1835); Tytherleigh v. Harbin, 6 Sim. 329 (1835). In Parker v. Tootal, 11 H. L. 143 (1865), a different rule was applied to a bequest to “my daughters, and their children.”

The wills construed in our own courts, so far as I have been referred to the decisions, are those where the issue or heirs took under a subsequent independent clause, but the same construction •was followed. In Outcalt v. Outcalt, 15 Stew. Eq. 500 (Chancellor Runyon, 1881), the testator, “after the death of his wife,” directed that the residue of his estate should be divided

“among my several children, share and share alike, and in the event of any -of my said children dying before my wife and leaving issue them surviving, such issue shall be entitled to receive the parent’s share, the same as said parent would receive were he or she living.”

The issue of a child who was dead at the date of the will were held to be included, and it was held that by “my several children” testator did not mean his several children then living, but meant all of his children. A fortiori, where the gift to the children or their heirs is made, as here, by a single clause, it must be presumed that the testator had in mind the heirs of all his children.

The argument most strenuously urged for the exclusion of the heirs of a- child deceased at the date of the will is that the words “their heirs” refer, and must refer, not to “children,” but to “living children,” as their antecedent, and therefore cannot include the heirs of any child deceased. But, as above pointed out, the real question is whether, by a gift after the death of his wife “to my living children,” the testator meant “my [now] living children,” or “my [then] living children.” By making the gift not immediate, but to take effect and be enjoyed at a future time, the testator has rendered the expression “my living children” ambiguous, but as it must, upon the whole will, be referred to some time, the question is at what time did testator intend to refer to his children as “living.” If he meant children living at the date of the will, and those only, then “their heirs” refers to these “living children.” If, on the other hand, he meant either living at the date of his death, or at the date of ■ distribution, then “their heirs” refers to “children” as its only antecedent, for' there could be no “heirs” to a child living at either of those periods, nor could the testator be presumed to have intended a gift to the heirs of a “living child.”

My conclusion is that the heirs of a child of testator who was dead at the date of the will are entitled to one-fonrth of the personal estate. If there is any question as to who constitute these heirs of Mrs. Barclay, who take .the bequest, I will hear counsel on that point.


author: Emery, Y. C.

text:
    Clarence Edward Dougherty et al. v. Charles E. Connolly et al.
    [Filed March 23d, 1901.]
    1. Testator’s will gave his wife a life estate in his realty, with power to sell and invest the proceeds, the income to be hers for life. The widow conveyed to 0. part of the property of the estate for an expressed consideration of $1, but no consideration passed. C. then borrowed money of a trust company, giving a mortgage on the land, which was subsequently reconveyed to the widow. The trust company also carried on a title guarantee business, and a memorandum on an application for a guarantee of title made by the mortgagor showed that the consideration for the conveyance to C. was nominal. The parties interested went to the office of the trust company, and there executed the deed and mortgage in the presence of the trust company’s attorney, who knew that no passage of consideration took place at that time, and he made no inquiries as to the nature of the transaction.—Held, that the trust company was chargeable with knowledge that the transaction was not a tona fide or authorized exercise of the widow’s power of sale, and hence the mortgage was invalid as against the remaindermen, and bound only the life estate.
    2. Where testator’s will made his wife executrix and life tenant, giving her power to sell property when advantageous, and reinvest the proceeds, the income to be hers, and she agreed with O. to make a conveyance to him, without consideration, to enable him to raise money by mortgaging the land conveyed, which was thereafter to be reconveyed to her, and such agreement was carried out, and 0. conveyed to D., who gave 0. a mortgage, and then conveyed the property to the executrix, the deeds and mortgages were void so far as they conveyed anything beyond the life estate of the widow.
    3. A widow and executrix, having a life estate in the land of testator, with a right to sell and invest the proceeds, the income to be hers, sold certain land and invested the proceeds without consulting the remainder-men; the investment afterwards turning out to be worthless. Personal property to the amount of $2,900 came into her hands, for which she never accounted, and she applied the proceeds of a $3,000 life policy to the payment of a mortgage on certain lands.—Held, that to the extent to which personal estate or proceeds of real estate applicable to the payment were received by the executrix and by her applied to her use or not accounted for, she must be considered as having applied them to the payment of the debt to her, arising from her redemption of the mortgage, and the facts justifying the conclusion that the mortgage was paid off with the intention of discharging the inheritance under circumstances which made it equitable for her to do so, she was not entitled to be subrogated to the rights of the mortgagee, and hence a mortgagee of her life estate had no such subrogation.
    Heard on bill, answers and cross-bills, replications and proofs. '

      Mr. John R. Hardin, for the complainants.

      Mr. Algernon T. Sweeney, for the defendant Mrs. Dougherty.

      Mr. Thomas N. McQarter, for the defendant the Fidelity Trust Company.
   Emery, Y. C.

Dr. Alexander N. Dougherty, the testator, who died in 1882, by his will devised his real estate to his widow, Henrietta A. Dougherty, for life, and appointed her executrix, with the following power of sale:

“Third. If it should be advantageous hereafter during the lifetime of my said wife in the opinion of my executrix hereinafter named to sell all or any portion of my real estate, it is my will and I do hereby direct and order that the same be so sold at the discretion of my executrix aforesaid, either at public or private sale, and I do 'authorize and empower my said executrix to make such sufficient conveyance as may be required to the purchaser or purchasers of the same, the money arising from such sale or sales to be securely invested and the income thereof to belong to my said wife for her own use during her life.”

Subject to this life estate and power of sale, the lands were devised to his four sons, three of whom are the complainants and one of whom is a defendant. ' Complainants have, or claim, a contingent interest in the share devised to their brother, the defendant, but, for the purposes of the present inquiry, this circumstance need not be further noticed. On July 10th, 1895, Mrs. Dougherty, by a deed of that date, executed by herself as executrix, under the power of sale, and also individually, and for an expressed consideration of $1, conveyed the real estate, a house and lot in Newark, to the defendant Connolly. Connolly and his wife executed a mortgage on the lands, on the same date, to the defendant the Fidelity Trust Company, for $6,000, payable in three years from date, with interest. Subsequently, and by deed dated August 10th, 1895, Connolly and wife conveyed the premises to the defendant Dempsey, by deed, with full covenants of warranty, for the consideration of $1, and Dempsey, by deed dated August 24th, 1895, for a like consideration, conveyed the premises to Mrs. Dougherty, by a deed of bargain and sale, without covenants. The deeds from Connolly to Dempsey and from Dempsey to Mrs. Dougherty were recorded on the same day—August 26th, 1895. Dempsey, on the 24th of August, the date of his déed to Mrs. Dougherty, executed a mortgage to Connolly on the premises for $2,500, which was recorded on August 26th, 1895, six minutes subsequent to the record of Connolly’s deed to him, and at the same time as his deed to Mrs. Dougherty. This mortgage is still outstanding of record. The bill charges that the power of sale was fraudulently exercised by the executrix for the purpose of raising, by means of a mortgage on the premises, $6,000, which Connolly was to receive and use in a partnership business, in which he and Mrs. Connolly wére to be jointly interested, and that, for the purpose of carrying out this scheme of borrowing money and evading the provisions of the will, the premises were to be convejed by the executrix to Connolly, and after the execution of the mortgage Connolly was to reconvey the lands at once to Mrs. Dougherty; that instead of reconveying at once, as agreed, Connolly held the title for several weeks, and before the reconveyance, and without Mrs. Dougherty’s knowledge, conveyed the lands to Dempsey, without consideration, receiving from him the- mortgage of $2,500, in fraud of complainants and of Mrs. Dougherty, which was fraudulently retained by Connolly on the reconveyance by Dempsey to Mrs. Dougherty as an apparent lien on the property. It is alleged that no consideration ■for any of the conve3ances was paid’by any of the parties, and that the entire scheme of rasing the money was a fraud on the executrix, by an abuse of her confidence in him, and was a fraud on the complainants’ rights. As to the Fidelity Trust Company mortgage, the bill charges that the mortgage was taken with notice of the extent of the power of complainants’ rights as devisees and with notice that the power of sale was not properly exercised for the purpose of the advantageous sale, in the exercise of a proper discretion of the executrix, and was made for other and improper reasons, and it is claimed that the nominal consideration of the deed from the executrix to Connolly was notice that the sale was not a bona fide sale under the power made for the purpose of procuring funds for investment, and that the trust company received its mortgage with full notice of Connolly’s defective title. It is prayed that the trust Compaq mortgage and all the conveyances and mortgages be declared void as against the complainants. The trust company, admitting the execution of the deed from the executrix to Connolty, and its advance to him, by way of mortgage, of the $6,000, alleges that this was advanced in good faith, and without any knowledge of any matters to put it upon inquiry or to charge it with the duty of inquiring as to the actual consideration of the sale, or to inquire, into the appropriation of the proceeds of sale, and denies receiving the mortgage with notice that the conveyance to Connolly was made for improper reasons, or without consideration, or that Connolly’s title was defective; claims to be a bona -fide pur chaser, and that the mortgage is a valid encumbrance upon the entire fee of the premises, including complainants’ interest. The mortgage having become due by reason of the failure to pay installments of interest, the trust company, by way of cross-bill filed against Mrs. Dougherty, prays that if it should be decreed that the mortgage is void as against complainants, Mrs. Dougherty’s life estate, which was also conveyed by the mortgage, may be sold. Mrs. Dougherty, as executrix and individually, answers complainants’ bill, substantially admitting the charge of the bill, as to the purpose of the conveyance to Connolly and that no consideration was received by her for the deed, and she also files a cross-bill against the trust company, Connolly and Dempsey to set aside the deed from Connolly to Dempsey and the mortgage from Dempsey to Connolly, as given in fraudulent violation of Connolly’s agreement with her to transfer the property to her immediately after the mortgage, and also to set aside the trust company mortgage, because it was taken with notice that the deed from her to Connolly was without consideration, and that the mortgage was made for Connolly’s benefit only. The defendants Connolly and wife and Dempsey do not appear to answer either the bill or cross-bill. The evidence of Mrs. Dougherty, corroborated by the papers and documents in the case, shows, beyond dispute, that, as between Connolly and Mrs. Dougherty, the transaction was not intended as a bona fide sale of the property, but as a method of raising money, by way of mortgage on the premises, which was to be advanced to Connolly, who was to repay it, and that Mrs. Dougherty (who was to continue in possession of the property and receive its rents) was to receive some benefit from this advance to Connolly on the mortgage, either by way of interest, to be also paid to her, or a share of the profits in a partnership with Connolly. So far as relates to these defendants, therefore, the deeds to Connolly and Dempsey and the mortgage from Dempsey to Connolly must be set aside as fraudulent and void, and so far as they assume to convey anything beyond the life estate of Mrs. Dougherty, must be declared not to affect the rights of the complainants or of the defendant Alexander Garthwaite Dougherty, and the mortgage from Dempsey to Connolly must also be declared void as against Mrs. Dougherty and the defendant trust company as claiming title through her. The real issue contested at the hearing was as to the validity; of the trust company mortgage on the estates of the complainants, it being conceded that the mortgage was valid as to Mrs. Dougherty’s life estate. The question is whether the circumstances attending the execution of the mortgage and the advance of the money were such as to charge the trust company with notice that the sale to Connolly was not intended as a bona fide execution of the power of'sale. The evidence connecting the trust company, or any of its officers, with such notice is substantially as follows: On July 2d, 1895, and before he had received a deed, Connolly made a written application to the trust company for a loan of $7,000 upon the premises. The application, as appears by the signature of a member of the board of directors of the company, was reported upon favorably for $6,000. This report was dated July 15th, 1895, but the application must have been practically acted on and agreed to at once, for on July 3d a written application, bearing this date, signed by Connolly, was made to the trust company (which also carried on the business of guaranteeing titles) for a guarantee of title in the sum of $6,000, the amount agreed to be loaned. As appears by this paper, the seller of the property was to be Henrietta A. Dougherty, executrix of Alexander N. Dougherty, under will probated December 18th, 1889, and it is stated in the application, “Mrs. Dougherty is to sell to Chas. E. Gonnolly, Cons. $1.” Upon the application is also an endorsement, “Will call Tuesday a. m., to execute papers.” On July 10th, 1895, Mrs. Dougherty, in company with Connolly and his wife, went to the office of the trust company, and the deed and mortgage were there executed in the presence of Mr. John J. Joyce, an attorney-at-law, who was, at that time, the assistant, or acting, title officer of the company. He was the subscribing witness to the deed and mortgage and took the acknowledgments. Mr. Joyce says that he remembers, in a general way, that Mrs. Dougherty and Mr. Connolly were there, and that there was a settlement of certain matters connected with the title and the loan, but that he cannot recall anything specifically said at that time. He_.represented the company in the transaction, and no other person representing the company was present. Mrs. Dougherty, the only other witness called as to the interview, says that only herself, Connolly and his wife and the gentleman who took the acknowledgments were present, and that Mr. and Mrs. Connolly signed the mortgage and their acknowledgments were taken, and says that there was no talk at all about the matter, and that she went there for this purpose and nobody asked her anything. She further says that, after acknowledgments were taken, she and Mrs. Connolly went to the station with Mr. Connolly, who left them there, while he returned to receive the money on the mortgage. The money for the loan was paid by a check of the company, signed by its treasurer, for $5,932.68, which was drawn after Mr. Joyce had drawn and signed an order for its payment. The check was for the amount of the loan ($6,000), less the charges for searches, guarantee of title, and the expenses for searches, &c. ($67.32), which expenses included, as appears by the endorsements on the application for guarantee of title, the expense of drawing the deed ($3), and also the bond and mortgage ($5) and for recording both papers. The check was paid to Connolly in cash over the counter, and after receiving the money he joined his wife and Mrs. Dougherty at the station and accompanied them to New York, and on the same day Mrs. Dougherty went with Connolly to his counsel’s office, in New York, and signed the partnership articles with him. Throughout the entire transaction relating to the sale and loan Mrs. Dougherty had no counsel specially representing her. From the memoranda on the application for guarantee of title, made as to the future attendance of the parties to execute the papers, and of the charges of the company for drawing them, it would seem that Mr. Joyce, or some other agent of the company, represented or acted for all parties for the purpose of drawing the papers to perfect the title in Connolly as mortgagor to the company. The deed itself and the memorandum on the guarantee show that the company had notice that the consideration in the deed was nominal, and Mr. Joyce, the trust company’s officer, having taken charge of the actual transfer of the title from the executrix to Connolly, knew," not merely from the recital in the deed, but from what actually occurred in his presence and under his direction, that the transfer of the title had been prepared and perfected without the pajunent of a dollar to the executrix. Actual payment or securing of the consideration would, in the ordinary and due course of business, have taken place at the delivery of the deed, and certainly before the execution and delivery of a mortgage by the grantee to a third person, in the presence of the grantor, which would, or might, postpone her lien for the purchase-money if it had not been paid. Under these circumstances, and with the knowledge that the ordinary course of business was departed from, Mr. Joyce was, as a prudent man, put upon inquiry as to whether the executrix was making a bona fide sale in the exercise of her power, or whether the transfer of title, like the consideration, was nominal only, and the whole transaction was only a method of obtaining a loan for Connolly on the premises by a mortgage to the trust company. The failure to make inquiries seems, under all the circumstances, to warrant the inference that if Mr. Joyce, did not know the real intention of the parties, he at least intentionally refrained from making inquiries, in order that he might not receive information as to the intent. In such case the negligence would, without question, be so gross as to charge him with knowledge of the intent. But, if without any such intentional failure to make inquiries, he was, as a reasonably prudent man, put upon inquiry as to the real intent of the transfer, then, in the absence of any sufficient explanation as to why the inquiries were not made, the company are chargeable with notice of the facts which, would have been ascertained from an inquiry duly prosecuted. 'No inquiries whatever appear to have been made by Mr. Joyce, neither has any explanation been given of the failure to make them. In the absence of such inquiry or explanation, it must be conclusively presumed against the party chargeable with the duty of inquiry that the real facts relating to the transfer would have been ascertained. That the effects of notice of circumstances which should put a purchaser upon inquiry as to the fraudulent intent of a conveyance is equivalent to notice of the intent, is settled. Tantum v. Green, 6 C. E. Gr. 364, 369 et seq. (Errors and Appeals, 1869); De Witt v. Van Sickle, 2 Stew. Eq. 209, 215 (Vice-Chancellor Van Fleet, 1878); Moore v. Williamson, 17 Stew. Eq. 496, 503 (Chancellor McGill, 1888). These were cases where the intent, with notice of which they were charged, was that of defrauding creditors, but the principle does not depend upon thfe particular character of the fraudulent intent, and the rule itself is only a special application of the general rule relating to the doctrine of notice stated by Chancellor Kent (4 Com. *179), and approved in Hoy v. Bramhall, 4 C. E. Gr. 563, 572 (Errors and Appeals, 1868), in reference to the effect of notice of circumstances charging a person with the- duty of inquiry: “The general doctrine is that whatever puts a party upon inquiry amounts, in judgment of law, to notice, provided the inquiry becomes a duty, as in the case of purchasers and creditors, and would lead to the knowledge of the requisite fact by the exercise of ordinary diligence and understanding." See, also, 2 Pom. Eq. Jut. 60S. The whole question of fact to be decided, therefore, on this branch of the ease is whether Mr. Joyce was, under the circumstances of the case, as a reasonably prudent man, put upon inquiry as to this transfer being a bona fide exercise by the executrix of the power of sale. Reaching the conclusion that he was chargeable with the duty of this inquiry, the trust company, whom he represented, must be held chargeable with notice of the fraudulent character of the transfer. Its mortgage, therefore, so far as relates to the conveyance of any interest in the lands in question, other- than the life estate of Mrs. Dougherty, must be declared void. As to Mrs.’ Dougherty’s estate, the company is entitled to a decree for sale to pay the amount due upon the mortgage. The second branch of the case relates to the extent of Mrs. Dougherty’s interest in the lands applicable to the payment of the mortgage, and presents for decision the questions arising under the amended answer and cross-bill which the trust company obtained leave to file at the hearing.

This claim is that the trust company, as the mortgagee, through Connolly, of the life estate of Mrs. Dougherty in the premises, is, as against the complainants, the remainderman in fee, entitled to be subrogated to the benefit of a mortgage on the property created by the testator and paid off by the tenant for life, after her husband’s death, with her own money. The substantial facts appearing by the pleadings and proofs relevant, or claimed by either counsel to be relevant, to this issue of subrogation are as follows: Dr. Dougherty’s will bequeathed to his wife his entire personal estate and devised his real estate to her for life, with the power of sale above referred to, and the remainder over to his four sons. Mrs. Dougherty was also appointed sole executrix, and on January 3d, 1883,- filed an inventory, in which the personal property (being furniture, books, office fixtures) was appraised at $1,530, and the accounts due ($2,800) were appraised at $1,800. Ro account has ever been filed by the executrix, and the amount realized from the personal estate, according to the evidence on this hearing, was about $2,200, being $1,000 from the collection of accounts, and $1,000 to $1,200 from the sale of the furniture, &c. This latter sum, according to the statement of the executrix, does not include the value of the library, surgical instruments and horse and carriage (together worth over $700), which were given by Mrs. Dougherty to the complainant Dr. Arthur Dougherty, who continued his father’s practice^ collected the accounts due to his father and turned them over to his mother. The testator’s life was insured for the sum of $5,000, the policy being payable to his wife, and the Mutual Benefit Insurance Company held a mortgage upon the Park street property (the only real estate in Hew Jersey of which testator died seized), originally given by the testator himself for $5,200, but upon which, .at the time of his death, about $3,000 was due. On or about February 21st, 1883, Mrs. Dougherty received the insurance money and paid off the mortgage and had the same canceled of record. In the early part of the following year (1884) the executrix sold real estate in Horth Carolina, of which the testator died seized, for the sum of $4,000 in cash, which was received by her and invested, in her own name, in western mortgages, which have turned out worthless, so that this amount has been lost to the estate. Hone of the complainants appear to have been advised of or consulted with reference to the sale of the Horth Carolina lands or the investment of the proceeds. Ho account has ever been filed by the executrix, neither had she, up to the time of the transfer to Connolly, nor has she since, offered to account to the remainder-men for the personal estate or the proceeds of the real estate, nor has she ever asked from any of them contribution or subrogation for the amount paid on the mortgage. Mrs. Dougherty, considered merely as the life tenant of the real estate, subject to an encumbrance created by the testator himself, and devised to her for life, was undoubtedly entitled to redeem the mortgage, and, upon the payment of the mortgage, to hold it uncanceled, if she chose, and to be subrogated to the rights of the mortgagee. As against the personal representative of the testator, this right of subrogation extends to the immediate payment of the mortgage debt, inasmuch as the personal estate is the primary fund for the payment of mortgage debts created by the testator himself. McLenahan v. McLenahan, 3 C. E. Gr. 101, 103 (Chancellor Green, 1866); Campbell v. Campbell, 3 Stew. Eq. 415 (Chancellor Runyon, 1879); Coudert v. Coudert, 16 Stew. Eq. 407, 409 (Vice-Chancellor Bird, 1887). And if there is no personal estate, and the lands encumbered have been sold and all the estates in the land are represented by funds in court, then the life tenant redeeming is entitled, as against the remaindermen, to immediate payment of the principal of the mortgage out of the funds in court, and will not be barred by her cancellation of the mortgage through inadvertence or ignorance. Kocher v. Kocher, 11 Dick. Ch. Rep. 545 (Vice-Chancellor Pitney, 1898). But the present-case involves the further additional questions: (1) whether the life tenant, being herself executrix, and having received sufficient personal estate to discharge the mortgage, can, in any event, call on the remainder-men to redeem without accounting for the personal estate, which is the primary fund, both as to her and the remaindermen, for discharging the mortgage. If the life tenant is not thus first to account as executrix, then (2) whether she can call on the remaindermen to redeem by paying the principal at once, during the continuance of the life estate in the lands, or whether, as to the principal, the payment is merely the charge of a debt in her fav.or-upon the lands, payable by the remaindermen upon receiving the estate under the will. If payable at once, then (3) whether this right to pajonent or subrogation, as against the remaindermen, passed to her grantee (Connolly) by the conveyance of the life estate and also to Connolly’s mortgagee, and whether, on the bill to foreclose the mortgage, and in advance •of any sale under the mortgage, it can be declared that such right did pass by the mortgage of the grantee as against the •estate claimed in remainder. As to the last question: In Keene v. Munn, 1 C. E. Gr. 398 (Chancellor Green, 1863), it was held that the alienee or mortgagee of an heir or devisee,, did not, merely as such, succeed to the original equity of the heir or ■ devisee to have the debt discharged out of the personal estate. And where, as here, the question of marshaling the assets for •the payment of the debt, to which subrogation is claimed, is necessarily connected with the question of subrogation, my present view is that the right to subrogation for payment of the principal, if it existed at all, did not pass merely by alienation of the life estate after the payment of the encumbrance, without such an assignment of the debt or claim itself as would, either expressly or by implication, carry with it an assignment of the charge securing the debt. As to the second question (the right to require immediate payment by the remaindermen of the principal sum) : the authorities, as to the rights of a life tenant to redeem, so far as I have examined them, seem to establish that the life tenant’s right of redemption is prior to that of the -remaindermen, but that, inasmuch as his right of redemption is based on the rights in the lands given by the will, his rede2nption is allowed for the primary purpose of carrying out the trusts of the will for all parties, the remaindermen as well as the life tenant, and therefore the life tenant’s title held under the mortgage, or by the mortgagee’s reconveyance, if one is made, is a title upon the trusts of the will, and the reconveyance will be directed to be made upon these trusts. The remaindermen, therefore, cannot be called upon to redeem the principal before . the termination of the life estate, and, in the meantime, the life tenant holds a charge on the lands for the principal paid, which, upon his death, is enforceable by his personal representative or other assignees of the claim. Wicks v. Scrivens, 1 Johns. & H. 215; S. C., 4 Chit. Eq. Dig. 4068, 1; Pearce v. Morris, L. R. 5 Ch. App. 227, 230 (1869); 2 Seton Dec. 1052, and cases cited; Fish. Mort. *113; Ash. Mort. 280; Jones Mort. (5th ed.) 1065.

But without putting the decision of the ease upon either of these points (as to the assignability of the claim, or'the right to immediate payment), my conclusion is that the right to subrogation could not, on the facts appearing in this case, have been enforced by the life tenant against the remaindermen at the time of the conveyance to Connolly, and therefore no such right passed to Connolly or his mortgagee. In the first place, the personal estate was bound to exonerate the land from the burden of the mortgage, and the remaindermen, as well as the life tenant, were entitled to have recourse to the personal estate for payment. The remaindermen cannot be deprived of this recourse by the-failure of the life tenant, who was herself the executrix, to apply the personal estate for that purpose, and before any charge upon' the lands in her favor by way of subrogation to the mortgagee: could be declared, she would be bound to account for the per- - sonal estate and apply it in payment. And to the extent to-which personal estate, or proceeds of real estate applicable to. the payment, were received by the life tenant, as executrix, and by her applied to her own use, or are not accounted for, she must, in their favor, be considered as having applied them to the purpose with which they were primarily, chargeable, viz., the payment of the debt to her, arising from the payment or redemption of the mortgage. In the second place, the facts in the .case-justify the conclusion that the mortgage was paid off and canceled with the intention of discharging the inheritance and under circumstances which made it equitable for her'to do so. If so, the charge could not be reinstated or revived by a subsequent change of mind (Morley v. Morley, 5 De G. M. & G. 610, 624-(Lord-Chancellor Cranworth, 1855), or without showing fraud? or mistake in fact. Toplis v. Vonder Heyde, 4 Younge & C. 173, 180 (1840). In the latter case, a second wife, taking large-benefits under her husband’s will, paid off a mortgage on lands-devised to her for life, with remainder to the husband’s children by a former marriage, and by her consent the mortgage term was assigned to attend the inheritance. It was held that the payment was, prima facie, a gift to the remaindermen, and that the wife could not afterwards set aside the gift, except upon the ground of fraud or mistake in fact. A fortiori must the payment be-considered as made for the benefit of the remaindermen, where-this payment was a duty, which, as executrix, the life tenant was bound to perform, and which a court of equity will assume was performed. Her cancellation of the mortgage must be taken-to have been made in the performance of her duty as executrix, and the remaindermen could not, under these circumstances, be-deprived of the benefit to their estate, resulting from the cancellation, on the application of the life tenant herself.- The-subsequent assignee of her life estate, with notice of the cancellation, cannot stand in any better position than the life tenant herself. The amended cross-bill must, therefore, be dismissed, so far as it seeks a declaration or decree that the mortgage of the life estate is subrogated to the payment of the principal sum of the mortgage as a charge upon the lands prior to the estate in remainder. The trust company is entitled to a decree for sale of the life estate to pay the amount due upon its mortgage.


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    Martin Burne v. Adam Partridge et al.
    [Filed March 26th, 1901.]
    1. Pending suit against a debtor, she conveyed real estate by quit claim to one who held a mortgage on the property, no consideration passing. The deed provided that the mortgage should not merge in the title conveyed, and that the property might be redeemed on payment of the amount of the mortgage. The property was rented to the grantor at a rental about equal to the interest on the mortgage, the grantor assuming the repairs and taxes, and remaining in possession until her death, and it appeared that the property was worth more than the mortgage.—Held, that the conveyance was in fraud of existing creditors.
    2. Where one holding mortgages based on loans made to take up prior mortgages on the property thereafter receives a conveyance of the property, which is held invalid, as in fraud of a creditor subsequently acquiring a judgment, the judgment is subject to the liens of the mortgages for the amount due thereon.
    3. Where, fifteen years after obtaining a judgment, the creditor files a bill to set aside a conveyance of land made pending the suit in which the judgment was obtained, the delay is no bar to the right to set the conveyance aside; the bill being one for equitable aid to enforce a legal right, which is not barred.
    4. Where, pending suit, the defendant conveyed property to one having a valid mortgage thereon, and fifteen years after judgment the plaintiff sought to set aside the conveyance and mortgage, the grantee being entitled, under his mortgage, to set off interest, taxes, &c., against the rents received and the delay rendering such an accounting difficult, if not impossible, an accounting could only be had from the time the bill was filed.

      Heard on bill, answer, replication and proofs.

      Mr. John II. Meeker, for the complainant.

      Mr. James E. Howell, for the defendant Partridge.
   Emery, Y. C.

This is a bill by a judgment creditor to set aside as fraudulent a conveyance of his lands made by the debtor to a prior mortgagee, and also to set aside the mortgages as fraudulent. The conveyance to the mortgagee was expressly declared to be without merger of the title under the mortgages. The bill was filed fifteen years after the recovery of the «¡judgment, and asks an accounting of the rents and profits from the time of the conveyance. My conclusions upon the questions raised and argued at the hearing are as follows:

First. The deed from Margaret Flynn, the judgment debtor, to defendant Partridge must be held to be fraudulent and void as against complainant’s judgment. The principal facts appearing in the evidence which indicate that the conveyance was a fraud on creditors are: (1) That the conveyance was made pending complainant’s suit and before the recovery of his judgment. (2) The conveyance was by quit claim deed, made without any consideration actually paid by the defendant Partridge, the grantee, who also held mortgages on the premises, the result being that, as to all value in the property over and above the amount due on his mortgages, the conveyance was purely voluntary, and therefore void, to that extent, as against existing creditors. (3) The insertion in the deed of an unusal clause, ■viz., a clause providing that the mortgages should'not merge in the title conveyed by the deed. This indicated that the transaction was not substantially a purchase of the equity of redemption, but a transfer of the legal title for some other purpose, and that the grantee had some reason to doubt the validity of the title by deed. No feature appears in the ease to affect the validity of the title by deed, except a possible attack by creditors. (4) The arrangement made between the grantor and grantee, that the grantor might redeem the property on' paying the amount due on the mortgages, the renting of the property at once to the grantor, at a rental which was fixed at about the interest on the sum due, the lessee (grantor) assuming the repairs and taxes, obligations usually assumed by the owners. (5) The continued possession of the grantee in the premises up to the time of her death. Under this combination of circumstances, pointing to the hindrance of the grantor’s creditors, as the intention of the transfer, the grantee, in order to repel the prima facie proof of fraud, was at least bound, I think, to show, by satisfactory proof, that, at the time of the conveyance, the property conveyed was not worth more than the amount due on the mortgages. The weight of evidence is, on the contrary, that the property was wojth considerably more. •

Second. The mortgages held by the defendant have been satisfactorily shown to have been based upon loans of money made, for the most part, if not altogether, to take up prior mortgages on the property, arid complainant’s judgment must be subject to the liens upon these mortgages for the amount due thereon. Independent of the express provision in the deed, that the mortgages should not be merged in the estate • created by the deed, this would be the effect, upon the defendants’ estate in the lands under the mortgage, of setting aside the deed as fraudulent against a creditor. 2 Big. Fraud. 416 § 5; Malloney v. Horan, 49 N. Y. 111, 121 (1872); Roberts ads. Jackson, 1 Wend. 478, 484 (1828).

Third. The complainant’s remedy to set aside the deed as fraudulent is not barred by the delay in filing the bill. The reasons for this conclusion were given in the conclusions filed on the' demurrer to the amended bill, which specially raised this question. I then concluded that inasmuch as the complainant was appealing to this court, not to. establish and enforce a merely equitable right, but to aid in the enforcement of a legal right under a judgment still outstanding, mere delay, where the delay has not been sufficient to bar the legal right, is not sufficient to bar the right to apply for equitable aid in enforcing the legal right. In addition to the case referred to in my conclusions then filed (Banking Company v. Maddever, 52 L. J. Ch. 733; S. C. on appeal, 27 Ch. Div. 528, which was a ease of fraudulent conveyance) I refer also to decisions illustrating, in other classes of cases, the same distinction as to the effect of delay in filing a bill between bills to enforce purely equitable rights and bills to aid in enforcing legal rights. Fullwood v. Fullwood, 9 Ch. Div. 176; Menendez v. Holt, 128 U. S. 514, 523. Uo facts have been shown in this case which would disentitle complainant to the application of this general rule, and it must therefore be applied, and the delay is no bar to the right to set aside the fraudulent conveyance. The delay in filing the bill would, however, have affected the right to an account for rents and profits prior to the filing of the bill, had such account been asked. The rule which has been applied in this state has been that the fraudulent grantee must account for the rents and profits from the time of the fraudulent conveyance if necessary to satisfy complainant’s judgment. Mead v. Combs, 4 C. E. Gr. 112, 115 (Chancellor Zabriskie, 1868); S. C., 11 C. E. Gr. 173, 178. In this respect our courts follow the decisions in New York and some other courts, and not those decisions which hold that the account runs only from the time of filing the bill. 14 Am. & Eng. Encycl. L. (2d ed.) 342,. But even where the rule is established that a delay in filing the bill, short of the time fixed by the statute of limitations for barring the legal right, is no bar to the equitable relief of setting aside the deed, in order to enforce the legal right, the delay in filing the bill may be a bar to the recovery on account of back rents and profits. Three Towns Banking Co. v. Maddever, 52 L. J. Ch. 788 (North, J., 1883). Such delay sometimes disentitles complainant to an accounting, even where relief, based on equitable title, is granted. Harrigan v. Smith, 12 Dick. Ch. Rep. 635 (Errors and Appeals, 1899). The grantee in this case, under his mortgage, would be entitled to set off the interest and disbursements for repairs, taxes, &c., against the rents- received, and complainant’s long delay in filing the bill (nearly fifteen years) has rendered an accounting for the rents during all that time difficult, if not impossible. The accounting for the rents and profits will run, therefore, only from filing the bill, and proper allowances must be made to the defendant for interest on the principal due, and for other allowances proper on accounting as mortgagee.

Decree will be advised setting aside the conveyance, and, if necessary, for an account of the amounts due on the mortgages, in order to make a sale of the lands, subject to the mortgages, for the payment of the complainant’s judgment. Settlement of the- decree will be made on notice, if necessary. My present view is that the amount due as principal will include the interest due at the date of the conveyance, and that the rents and profits received from the date of conveyance to the date of filing the bill should offset the interest and disbursements to that date, but if counsel desire, I will hear them on this point.


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    Mary Emma Johnson v. Albert J. Hahne et al.
    [Filed April 24th, 1901.]
    1. Where a building, having an easement of light and'air pertaining to certain windows, is raised, by which the location of the windows is substantially changed, the easement is not continued as to such windows in their new position.
    2. Where windows, to which an easement of air and light pertains, are permanently closed for over forty years, and no effort to open such windows has been made, equity will not enjoin the erection of a building on an adjoining lot which will interfere with such easement if it still exists.
    On bill for injunction. Heard on bill, answer, amended answer, replication and proofs.

      Mr. Bindley M. Garrison, for the complainant.

      Mr. Arthur B. Denman and Mr. Frederick G. Buniham, for the defendants.
   Emery, Y. C.

Complainant is the owner of a lot, 52 Halsey street, Newark, and defendants are the owners of lot, 50 Halsey street, adjoining complainant’s lot on the north. Upon complainant’s lot there is a dwelling-house, built on or close to her north line, and upon defendants’ lot there was, at the time of their purchase of the lot in 1899, a brick dwelling-house, extending back beyond complainant’s dwelling and also higher than complainant’s house. There was a space of about four feet between the two houses, the vacant space being altogether, or nearly so, on defendants’ lot, No. 50. There are, and were at the time of defendants’ purchase of lot 50, three windows in the north side of complainant’s house, opening, or which can open, towards this four-foot space, two of the windows being in the second story and one in the third, which is an attic story, the window being in the gable. Defendants purchased lot 50 for the purpose of erecting thereon and on adjoining lots, covering nearly half a city block, a store building, and they have torn down the brick building on the lot 50, and intend to erect on the southerly boundary line of their lot, being the northely boundary of complainant’s lot, a wall extending along the whole distance covered by complainant’s house, and to at least the full height of complainant’s house and of the store building, which is about ninety feet in height. The building, if so erected, will deprive.complainant’s dwelling of light and air through her windows, and the question in the case is whether complainant has the right to protection against such deprivation. The original easement for light and air over lot 50 to the dwelling on lot 52 arose from the facts that lots 50 and 52 were originally owned as a single lot by one Samuel Sayre, who purchased the property as a single lot, fronting fifty-two feet on Halsey street, on June 3d, 1831, and in 1832, while still owning the entire lot, erected on lot 52 a frame dwelling-house, with three windows on the north side thereof, toward the lot now called No. 50. This house (which was afterwards raised up one story) was originally a one-story house, with an attic, and the windows in the house (being the same as the windows now there) were originally located two on the first story and one in the second story or attic. One of the windows in the first story, the one nearest Halsey street, opened into a hall running along the north side ■of the house, and the other window of the first story was in an -extension of the main building and opened on a room in the extension used for a dining-room. On October 22d, 1832, and /after the completion of the one-story house, Samuel Sayre conveyed lot 52, with the house therein erected, to Davis Sayre, • and, by subsequent conveyances and the will of her mother, title to this house and lot became vested in the complainant, ■who resided in it up to about the time when defendants began ■.the erection of their .building. Lot No. 50, on the north, re■mained the property of Samuel Sayre until his death, in 1851, .•and on the partition of his estate the lot was conveyed to 'William R. Sayre, under whom defendants claim. Complain-nnt went to reside in the house originally built on lot No. S2 in the year 1854, and at that time, according to her evidence, the brick house had been erected on lot No. 50 about four feet from complainant’s house. The brick house was rprobably erected between 1851 and 1854 by William R. Sayre, •the son of Samuel Sayre, the original owner. In 1855 the 'Jhouse on complainant’s lot, No. 52, was raised up one story ■ and a lower story built on the foundation walls. There were -no windows in the new first story, and the old house was raised ■without changing the location of the old windows in the frame ■of the house itself. The entrance to the new first story is by a •door opening on Halsey street, into a hall which runs along the .-north side of the house to the extension, and from this hall '■.stairs lead up to the second hall, which was the original first-story hall, and was changed by replacing the front door with a window opening on Halsey street. The window opening from •this present second-story hall toward lot No. 50 has closed board -shuttters, and for many years (just how many does not appear) “these shutters have been closed, and a wardrobe, or other furniture, has been placed against the window. The other window on this story, which, before the building was raised, furnished light .•and air to the room in the rear of the first story used as a ■dining-room, has stationary slat blinds, partly open, and furnishes light and air to a room used as a sitting-room, which room has also windows on the south side. The attic room has no other window or source of light than the present window, either before or after the house was raised.

In reference to the right to an easement of light and air over defendants’ lot to complainant’s house, it was admitted by counsel on both sides that, under the decisions, there could be no contest in this court in reference to two propositions. The -first is, that, on the separation of the title of the two lots (50 and 52), by the conveyance of lot Ho. 52, with the building thereoú erected, an easement for light and air over lot Ho. 50 was created, or arose by implication, in favor of the building then erected on the grantee’s lot, Ho. 52. Robeson v. Pittenger, 1 Gr. Ch. 57 (Chancellor Pennington, 1838); Sutphen v. Therkelson, 11 Stew. Eq. 318, 322 (Chancellor Runyon, 1884); Greer v. Van Meter, 9 Dick. Ch. Rep. 279, 272 (Vice-Chancellor Reed, 1896). The second is, that complainant did not, and could not, acquire an easement for light and air over defendants’ lot in the changed location of the windows merely by adverse use or-enjoyment since 1855. Hayden v. Dutcher, 4 Stew. Eq. 217 (Vice-Chancellor Van Fleet, 1879). The questions argued in the ease were, therefore, first, whether the original easement acquired by the conveyance of lot Ho. 52, on the separation of the title, extended to the same windows in their location as changed by the raising 'of the house, and second, if it did not extend to the windows in their changed location, then whether the easement for the windows in their original location in the north wall of the house still existed and could be now re-established and reasserted, or whether the original easement has been abandoned. In City National Bank v. Van Meter, 14 Dick. Ch. Rep. 32 (1899), the facts were that the owner of a building which had an easement of light and air to a window therein, removed the building for the purpose of erecting a new one. the plans for the erection of the new building showing a new window in substantially the same location as the window of the old building. Vice-Chancellor Reed considered the question involved to be the single question, whether the easement was abandoned by the destruction of the old building. He held, as the result of an examination of' that question, that the abandonment of an easement of this character was a question of intention and was a question of fact, and that this intention of abandonment could not be -found to exist where the old building was torn down, and the intention was to erect at once in its place a new building, in which a window should occupy substantially the same place as that occupied by the window in the old building. The case necessarily involved an examination into the nature of the right of an easement of light, so far as related to its being attached to a particular locality in the building erected on the dominant tenement, and the case on which the vice-chancellor relied as stating the rule upon this point of changing locality held that no alteration in the plan of the windows by the owner of the dominant tenement, either by advancing or setting back the buildings, would destroy the right to light so long as he could show that he is using through the new aperture in the wall of the new building the same, or a substantial part of the same, light which passed through the old aperture into the old building, and that the right to the light might be claimed in respect to. any building which is enjoying the whole or a substantial part of the light which passed into the dominant tenement through the old aperture. Scott v. Pape, 31 Ch. Div. 554 (C. A., 1886), reviewing all the previous cases. In reference to the subject of the locality of the old and new windows, Vice-Chancellor Reed also says (Ibid. 282) : “If the building be torn down and the locality of the old windows, from delay in building, or from a failure to preserve evidence of their situation, cannot be proved, the right would be considered as lost by abandonment.” The opinion of the vice-chancellor was adopted by the court of errors and appeals, in affirming his decree granting an injunction. 47 Atl. Pep. 1131 (November, 1900). The decision in this case, as I read it, rested on the theory that the right to the use of the new window existed, because it occupied substantially the same location as the old window, and finally settled the rule in this state, that the owner of the dominant tenement was entitled to an easement of light and air through the new apertures in the new building if, by the new structure, he was enjoying the same substantial right in the same location as in the old building. If this was the ratio decidendi of the decision, it controls this case, so far as complainant’s rights depend upon the easement arising out of the original conveyance of the lot, and the owner of the dominant tenement claiming merely under the original grant can have no right to an easement of light in the new windows, the locations of all of them being substantially changed from the location of the old windows. And this conclusion, as to the effect of changing the location of the windows, must also be reached if the question can be considered as still open. Any substantial change in the location of a window must, as it seems to me, be necessarily a substantial change in the burden on the servient tenement, and this is the doctrine of the cases cited by Vice-Chancellor Reed and of other cases cited by defendants’ counsel. Fowlers v. Walker, 49 L. J. Ch. 598 (Vice-Chancellor Bacon, 1880); affirmed on appeal, 51 L. J. Ch. 443 (1882); Turner v. Spooner, 1 Drewry & S. 467 (Vice-Chancellor Kindersly, 1861). The right to restrict an owner of adjoining land from building on his own land, whether gained by use or grant, must be confined to the subject-matter of the use or grant, and the restriction on the owner of the servient tenement must be substantially the same. The reason, as stated by Mr. Justice Patterson, in an opinion in Blanchard v. Bridges, 4 Adolph. & E. 176, 191 (1835), a leading case, is that the act of the owner of the adjoining land, from which the right of unobstructed access of light and air over the land flows, must have reference to the state of things at the time when it is supposed to have taken place, and, as the act of the one is inferred from the enjoyment of the other owner, it must be measured by that enjoyment, and the consent therefore cannot fairly be extended beyond the access of light and air through the same aperture (or one of the same dimensions and in the same position) which existed at the time when such consent was supposed to be given. Both convenience and justice require this limitation, for if a new window, varying in size, elevation or position, may be substituted for the old one, without the consent of the owner of the adjoining land, it would be necessary to submit to juries questions of degree, often of a very uncertain nature and upon very unsatisfactory evidence. Hutchinson v. Copestake, 9 C. B. (N. S.) 363 (Exchequer Chamber, 1861), approves this rule, and the court refused to assent to the argument that it was a question of a greater amount of inconvenience to the servient tenement, resulting from, a change in location. The cases referred to by complainant’s counsel do not, when read in connection with the facts involved, establish any different rule.

Complainant’s bill alleges that the windows of her house, as at present located, are the windows of the house as originally built, and the bill was framed on this theory. The complainant’s own evidence having disclosed, however, that this was a misapprehension, and that Mr. Dreer, the complainant’s witness, had the house raised in 1855, complainant now claims that if the windows in their changed condition have no right of access for light and air, she has the right to restore or re-establish the windows in the original location and have this right established in the present bill.

If this question were properly at issue on the pleadings, and within the jurisdiction of the court, I should be inclined, on the evidence before me, to hold that the easement for the old windows had been abandoned. As to the light of the first-story windows, the facts are these: a solid wall has been built, and all effort to obtain light for that story, from windows opening on the adjoining lot, has been abandoned for over forty years, and purchases of the adjoining property have been made without notice of any claim to such an easement. The same observation may be made about the closing, on the new second story, of the location of the old attic window, and it may also be noted that this window, if replaced, would probably open on the stairs leading from the second to the third story, and be of no use or benefit in the enjoyment of the hall, which already receives so much light that the new second-story window has been unopened for years. But the whole question as to the complainant’s right to restore the ancient windows, or her right to prevent obstruction, if restored, is one of legal right. There is not, in reference to this right, a question calling for equitable interference in advance of a determination of the legal right in the courts of law, as there is in reference to the right now claimed to the existing windows which were used and necessary for the beneficial enjoyment of her residence. The old windows, having been closed for forty years, and the defendants having purchased also' for the express purpose of building on their own land, there is no foundation, in my judgment, for now determining in this court, and in advance of any restoration or attempt to restore the old windows, that complainant has such right and that defendant must be enjoined from obstructing these lights when restored. This question as to this right must be first settled by an action at law, when the right of access of light and air to the old windows is, in fact, interrupted. There are in complainant’s bill allegations (made as if the bill were filed under the act to quiet title) of possession of the easement, but as to the old. windows there is evidently -no such possession, and inasmuch as the act of defendant sought to be enjoined is itself an interference with the peaceable possession, which is suable at law, jurisdiction under this act cannot be invoked in the ease. Allaire v. Ketcham, 10 Dick. Ch. Rep. 168 (1896).

There is a line of cases which holds that where the owner of the adjoining servient tenement consents to the alteration of the location of the lights in the course of the rebuilding, by the owner of the dominant tenement, and the latter owner makes the alteration and lays out money in rebuilding, relying on this' consent, a court of equity will enjoin interference with the lights in the altered location. Cotching v. Bassett, 32 Beav. 101 (Romilly, M. R., 1862). In the present case, the erection of the three-story brick building within four feet of the complainant’s house interfered, to some extent, with the easement previously enjoyed, and if the raising of complainant’s house, changing the location of the windows, had taken place before or contemporaneously with the erection of the brick house, these facts, in connection with the long-continued enjoyment of the use of the light and air from the new windows, might, perhaps, have been sufficient to justify a court of equity in finding a consent to the change of location of the windows. But as the complainant’s house was raised subsequently to the erection of the brick house, this raising of the house and changing the location of the windows may just as reasonably be attributed to the owners being willing to take the risk, as to their building, of any removal or change in the larger brick building on the adjoining lot. There is no evidence which would justify me in finding that this subsequent raising of the house and change in location of the windows was by the consent of the owner of the adjoining land as a substitution for the old windows. The whole case before me, therefore, depends on the complainant’s right to light and air for the new windows, as resting on the circumstances of the original structures and the subsequent conveyances and on the uses of these windows, and I reach the conclusion that the right to prevent defendant’s erection of a building on his own lands, which will interfere with the light to these new windows, has not been established, and the bill must be dismissed.