author: Olippiant, C. C. J.

text:
    STELLA M. REINHARDT, PLAINTIFF, v. MARY M. CALHOUN, DEFENDANT.
    Decided August 15, 1931.
    Eor the plaintiff, James J. McGoogan.

    Eor the defendant, Charles Be F. Besare and Samuel B. Lenox.

   Olippiant, C. C. J.

This is an action on a bond against the devisees of Alfred T. Clark, deceased. The bond was made by him on January 31st, 1921, to Eachael Levy, in the penal sum of $6,000, conditioned to pay $3,000 with interest at six per centum per annum. To secure the bond he executed a mortgage of the same date to Eachael Levy on Nos. 441, 443, 445, 447, 449 and 451 Lamberton street, in Trenton, of which he died seized in fee-simple. He devised the mortgaged premises to his wife, Mary E. Clark, for her life, and at her death to the defendant, Mary M. Calhonn, his daughter, in fee.

On July 3d, 1923, Rachael Levy assigned the bond and mortgage to the plaintiff.

Alfred T. Clark died on May 15th, 1921, and left him surviving his widow, Mary E. Clark, and his two children, Mary M. Calhoun and Earl Clark, to each of whom, by his last will, he devised certain of his real estate in fee-simple.

The mortgage was foreclosed and the premises were sold by the sheriff of Mercer county on April 17th, 1929. The sale resulted in a deficiency, and this action was originally begun against the defendant, Mary M. Calhoun, and notice thereof was filed in the Mercer county clerk’s office as required by the Mortgage act. 3 Comp. Stat., p. 3423, § 51.

The case was tried by the court, sitting without a jury, on April 30th, 1931.

On motion of the attorney for the defendant, Mary M. Calhoun, and with the consent of the plaintiff, Mary E. Clark and Earl Clark were joined in the action as parties defendant, and the complaint amended accordingly. The plaintiff suffered a voluntary nonsuit as to the added defendant, Mary E. Clark, and elected to proceed against the defendants Mary M. Calhoun and Earl Clark. All the facts necessary were proved by the plaintiff, and if she be entitled to a verdict it would be in the sum of $2,279.30, with interest from March 8th, 1929.

At the conclusion of plaintiff’s case a motion was made by the defendant, Mary E. Calhoun, for a nonsuit based on the following grounds—first, that the defendant Mary E. Clark, being a necessary party to the action, the plaintiff could not proceed against the other defendants after suffering a voluntary nonsuit as to her; secondly, that the plaintiff, having failed, as shown by the proof, to give the notice required by the Mortgage act, supra, as to the defendants Mary E. Clark and Earl Clark, and the statute of limitations for beginning the action against them having run, the plaintiff is precluded from taking a judgment against the defendant Calhoun.

Mary E. Clark and Earl Clark were necessary parties to the suit. In the case of St. Mary’s Church v. Wallace et al., 10 N. J. L. 311, which was a suit against the surviving heirs of an obligor, upon a bond of their ancestor, the heirs of a deceased heir having lands by descent and not being joined in the action, the court held that all should have been made parties defendants “inasmuch as they are answerable by reason of the lands descended; and as by due pleading they may subject the lands and the lands only to the discharge of the debt, there seems an obvious propriety in uniting all in one common suit; as, if part only are sued, the creditor may obtain judgment against part only of the lands, and may be compelled to resort for the residue of the lands to an action against the other heirs.” A plea in abatement was sustained and judgment rendered for the defendant.

That action was against heirs, but citing that case the Court of Errors and Appeals, in Cumberland National Bank v. Frome et al., 87 N. J. L. 623, which was an action against a devisee of lands for the debt of. the devisor, said that all devisees were necessary parties to the action. That doctrine was also approved in McCarthy v. Mullen, 82 Id. 379.

The liability of the heir or devisee to the creditor is not a liability for the full amount of the debt, but only for such amount thereof as can be collected from the lands devised or inherited, if not aliened, or for the value of the lands devised or inherited, at the time of the devise' or inheritance, if aliened.

An action to charge heirs or devisees with the debt of an ancestor or testator is an action to enforce a lien against the lands of the ancestor or testator which came into the hands of the heir or devisee. St. Mary’s Church v. Wallace, McCarthy v. Mullen and Cumberland Bank v. Frome, all above cited. The only reason given for joining all the heirs is that the obligation of the ancestor did not survive against the surviving heirs, but followed the land. The decision in St. Mary’s Church v. Wallace is to the effect that all lands descended are subject to the lien, and that, therefore, the obligation must be enforced against all decedents remaining in possession of lands descended. All should be joined, not because of any joint obligation between them, but because they are owners in whole or in part of the lands descended, all of which are subject to the lien. In St. Mary’s Church v. Wallace, apparently but one tract descended, the defendants owning it as tenants in common. In the instant case, numerous tracts descended to different individuals, but the application of the rule would remain the same whether the ownership is by severalty or by tenants in common.

I am convinced that all the devisees were necessary parties to the action.

The devisees not made parties in the original action were .added as parties defendant by the court.

This did not correct the difficulty because they were never properly made parties. No notice was filed in the county ■clerk’s office that the suit was to be brought or proceeded with against them as required by section 51 of the Mortgage ■act hereinbefore referred to. Compliance with that statute is jurisdictional. The statute is mandatory and a judgment ■against the added defendants would be a nullity. Neu v. Rogge, 88 N. J. L. 335. Counsel for the plaintiff argues that the intent of section 51 of the Mortgage act was to give the public warning that the record owner of the real estate described in the notice held title subject to the right of the foreclosed owners to redeem within six months after judgment entered on the bond. It is true that Mr. Justice Kaliseh in his opinion said: “The clear legislative intent was, by a public record, to make secure the title to a pur■ehaser * * but he further said: “We think a defendant not only suffers a wrong, but the public also, when -a judgment is entered against a defendant contrary to the ■express mandate of the legislature.”

Mary T. Clark and Earl Clark being necessary parties ■and they not having been properly made parties, in that the notice filed did not include them as defendants, the motion for a nonsuit should be granted. Such will be the order.


source: Caselaw Access Project

author: Brown, C. C. J.

license: Public Domain

text:
    Hudson County Circuit Court.
    GRACE E. EATLEY, PLAINTIFF, v. FRANK A. MAYER, DEFENDANT.
    Decided March 11, 1931.
   Brown, C. C. J.

The defendant moves to strike from the amended complaint a claim for punitive damages on the-ground that sufficient facts are not shown in the complaint or bill of particulars furnished to warrant a recovery of punitive damages.

The complaint alleges the defendant as a dentist who performed dental work for plaintiff and that “such work so-done * * * was negligently, unskillfully, carelessly and with a wanton disregard for plaintiff’s health and physical condition * * * performed.” The complaint also contains charges of particular acts of commission and omission to support the general charge of negligence and “wanton-disregard” of the rights of the plaintiff.

The bill of particulars refers to paragraph 3 of the amended' complaint which contains all of the allegations of negligence above mentioned. The demand for particulars,, among other things, demands a specificatiop. of acts of “gross” carelessness and negligence. There is a distinction between gross negligence and willful and wanton disregard of the rights of others. Gross negligence does not support a charge for punitive damages, while a charge of willful and wanton disregard does support such a charge. The test is the intent with which the act is committed. Rose v. Squires, 101 N. J. L. 438; 128 Atl. Rep. 880; affirmed, 102 N. J. L. 449; 133 Atl. Rep. 488. Both the complaint and bill of particulars in the case at bar contain charges of willful and intentional injury. It is contended that the particulars furnished are acts of omission, and therefore cannot be willful and engendered with an intent to do wrong-. The particulars contain acts of commission as well as acts of omission. Assuming that acts of omission alone were alleged, this would not of itself denote they were barren of intentional wrong or injury. A person may be intentional and willful in acts of omission as in acts of commission. Punitive damages may be awarded for failure to perform a manifest duty as well as for the negligent performance of an act which involves a breach of duty. 17 C. J. 988.

To constitute willfulness, there must be design, purpose, intent to do wrong and inflict injury. To constitute wantonness, the party doing the act, or failing to act, must be conscious of his conduct, and, without having the intent to injure, must be conscious, from his knowledge of existing circumstances and conditions, that his conduct will naturally and probably result in injury. 17 C. J. 984; Staub v. Public Service, 97 N. J. L. 297; 117 Atl. Rep. 48.

It is a general rule of pleading that it is not necessary to claim exemplary damages by name; it being sufficient if the facts alleged and the proof be such as to warrant their assessment. Malice should be alleged and shown. 8 R. C. L. 626.

The courts of our state have followed the rule that punitive damages spring from the wrongful motive of the defendant. Haines v. Schultz, 50 N. J. L. 481; 14 Atl. Rep. 488.

Where the act complained of involves malice or a wanton and reckless disregard of the rights of the person against whom the tortious act is committed, exemplary damages may be recovered. Hintz v. Roberts, 98 N. J. L. 772; 121 Atl. Rep. 711.

If malice and willful' injury cannot be shown, there can be no recovery of punitive damages in a malpractice case. Smith et al. v. Corrigan, 100 N. J. L. 267; 126 Atl. Rep. 680.

The right to award exemplary damages primarily rests upon the single ground-—-wrongful motive. Dreimuller v. Rogow, 93 N. J. L. 1; 107 Atl. Rep. 144.

The'amended complaint in this cause is sufficient upon which to predicate a right do recover exemplary damages.

The motion to strike the amended complaint will be denied.


author: Sooy, C. C. J.

text:
    Atlantic County Circuit Court.
    WILLIAM ERNST KENNEDY AND MARIE ERNST KENNEDY, PLAINTIFFS, v. ISLAND DEVELOPMENT COMPANY, DEFENDANT.
    Decided August 24, 1931.
    Eor the plaintiffs, Endicott & Endicott.

    Eor the defendant, Thompson & Ilanstein.

   Sooy, C. C. J.

This is an ejectment suit submitted on stipulation for trial before me without a jury.

It is stipulated, inter alia, that both plaintiffs’ and defendant’s title originated in the Brigantine Improvement Company and that “anything prior thereto shall be taken and deemed as not necessary to the consideration of this case.”

It appears that the Brigantine Improvement Company was a corporation of New Jersey; that one William M. Kennedy was a stockholder; that on October 15th, 1892, the Brigantine Improvement Company conveyed the locus in quo to said Kennedy and that the conveyance was not recorded until January 25th, 1927; that the Brigantine Improvement Company was dissolved in June of 1892; that on June 16th of 1902, the Brigantine Improvement Company, by its trustees, conveyed to the Brigantine Company; that subsequently, by reason of a sale under a judgment, title came to one Heald and that the title thus secured was conveyed to the present defendant by deed dated October 20th, 1923, and that the defendant is still in possession.

It is also stipulated that the Brigantine Improvement Company executed a mortgage to the Provident Life and Trust Company of Philadelphia, on May 4th, 1888, which mortgage was forthwith recorded, and this stipulation, known as number 6, concludes “the description in that mortgage conveyed, together with other land, all the lots in controversy.”

Going back to the deeds from the Brigantine Improvement Company to the Brigantine Company we find two—one directly from the company, and a confirmatory deed from the trustees on dissolution. The description is the same in both deeds and conveys three separate tracts or parcels:

1. “All the land situate on the upper or northeasterly end of Brigantine Beach' northeast of land formerly owned by Ocean Island and Brigantine Land and Improvement Company and not heretofore allotted and set off to its stockholders”

2. “All the land southwesterly of the land formerly belonging to the Ocean Island and Brigantine Land and Improvement Company which was described in a mortgage given by the Brigantine Improvement Company to the Provident Life and Trust Company of Philadelphia, dated May 4th, 1888, and recorded in the clerk’s office of Atlantic county in book No. 21 of mortgages, folio 481,” &c.

3. “All the residue and remainder of the lands of the Brigantine Improvement Company wheresoever situate, not heretofore sold or allotted to its stockholders including the accretions on the beach front and meadows not heretofore allotted, situate on Brigantine Beach aforesaid and the township of Galloway.”

It is quite evident that the grantees under these deeds was charged with the knowledge that tract No. 1 was for land “not heretofore allotted and set off to its stockholders” (of which stockholders to whom some of the land had been .allotted was Kennedy); that tract No. 2 was land described in the mortgage given to the Provident Life and Trust Company, and that, in order to discover its boundaries, a refer•ence to that mortgage would be necessary; that tract No. 2 included land of any kind belonging to the Brigantine Improvement Company “not heretofore sold or allotted to its stockholders.”

With particular reference to tract No. 2, the grantee’s inspection of the record would have disclosed the mortgage, .and a search of the status of that mortgage would have disclosed that the Provident Company had released to Kennedy the locus in quo by a release of mortgage bearing date December 31st, 1892, and recorded January 4th, 1893.

It is true that an examination of the record title, as that record is disclosed merely by deeds, would not have disclosed a conveyance to Kennedy, but it would have unearthed ■a release of mortgage to Kennedy as to the lots in suit and the recitals in that release of mortgage would have disclosed that “the Brigantine Improvement Company, by divers conveyances, had granted unto the following-named persons,” inter alia, “unto William M. Kennedy, the following-described lots,” including the locus in quo.

It is quite true that it may be said that this release is not ■one of the documents strictly in the chain of title under which defendant claims, but it does not seem to me that ■defendant may overcome the legal effect of the notice thus afforded it, especially in view of the character of the description in the grants of the Brigantine Improvement Company to the Brigantine Company. I recognize the rule to be that laid down by the Court of Errors and Appeals in Bock v. Koch, 99 N. J. Eq. 359.

In the ordinary case, as I have said, where the description in a deed is by metes and bounds and nothing at all appears to even suggest an inquiry or search outside of the direct «hain of title, it may well bo that the defendant would be ■excused from a failure to take notice of an instrument outside of the direct chain of title, but here the grantee was, in effect, told that the conveyance was of land (a) “formerly owned and not heretofore allotted,” (b) of lands described in a certain recorded mortgage, (c) of lands not heretofore-allotted to a particular class of persons, “stockholders,” and not sold.

It is true that the failure of Kennedy to record his deed would render the conveyance void as to a bona fide purchaser of the land for a valuable consideration, not having notice of the prior unrecorded deed. It is also true that the presumption is that such a grantee took title without notice,, putting the burden of proof of notice upon the plaintiff, but it is also true that the Brigantine Company had “clews”' upon which to work and which were so easily followed that to have failed to do so charges that company with its own neglect. This reasoning seems to me to be in accord with the opinion of the late Vice-Chancellor Pitney in the case-of McCrea v. Newman, 46 N. J. Eq. 474:

“The real force of the statement or recital in such cases is to give to the purchaser notice of an actually existing encumbrance, and the principle upon which recitals of thismeagre and incomplete sort are held to be notice of such encumbrance, is that they are sufficient to put the purchaser upon inquiry, and that he is chargeable with such facts, and. such only as might be ascertained by a reasonable inquiry— “it must give him a clew.”

I find that the failure to record the Kennedy • deed did not constitute defendant’s predecessor in title a grantee-without notice, but that the Brigantine Company took from, the Brigantine Improvement Company with notice of -the-conveyance to Kennedy.

It is also insisted by plaintiff that, outside the record, the-Brigantine Company was put on notice by the recitals in its deed and that an investigation of the minutes of the-Brigantine Improvement Company would have disclosed the-stockholders to whom conveyances had been made. I am inclined to think not, but that the proper place to investigate-was the “clew” thus afforded was the record of title and that a “reasonable inquiry” at that source would have given the-information.

Defendants say that plaintiffs may not succeed because-their title depends on an exemplification of the will of William M. Kennedy from the probate court in Pennsylvania, which exemplification has not been filed in Few Jersey. The answer to this contention is found in Maas v. Leblanc, 101 N. J. Eq. 167, wherein it is held that the filing of the exemplified copy of the will is merely evidence of the power to make the conveyance, but that the power to convey is derived from the will itself and not by any authority conferred by the act.

The next attack on the Kennedy title is that the deed from the Brigantine Improvement Company to Mr. Kennedy is void because it was executed by the president and secretary of that company, subsequent to the dissolution thereof, instead of having been executed by “trustees.”

In view of the Corporation act as it stood in 1892, i. e., the act of 1875, I think the conveyance by the president and secretary sufficient. By the act of 1875 these officers were constituted trustees for the purpose of “to dispose of and convey their property,” and the minutes of the meetings of the stockholders and directors of the company authorized the conveyance and, in addition, such conveyances were confirmed by an act of the legislature of 1899, chapter 147.

Defendants next urge as a bar to plaintiffs’ recovery, chapter 214 of the laws of 1928, which provides generally that where a deed conveys land by a general description, such as the deed to the Brigantine Company, the reservation, or exception of lots “which may have been theretofore sold shall be void against subsequent bona fide purchasers,” &c., “not having any other notice of any conveyance made by such prior owner,” &c.

Plaintiffs urge that this act is unconstitutional, but I do not have to pass on this question as I already have decided that the predecessors in title did have notice of the sale of the lots in question to plaintiffs’ predecessor in title, i. e., a search of the records would have disclosed that fact.

It is next urged by defendant that any right plaintiffs may have had in the premises have been lost by adverse possession. This result may not be reached under the stipulation which is, merely, “the Island Development Companj'is now in possession.”

Judgment may be entered in favor of plaintiffs.


author: Ckaeles E. Coeein, Deputy Commissioner.

text:
    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    SUSAN BENSON, PETITIONER, v. FRANK MACKENZIE, RESPONDENT.
    For the respondent, Slceffington, Wallcer ■& Corrigan.

   í|i # iji

The decedent, Thaddeus Ambry, was employed as a captain of the barge “Herbert,” which barge was owned and operated by the respondent in their business, and that as-such captain he received a weekly wage of $35 per week. It appears from the testimony adduced by the petitioner that-on or about March 22d, 1929, the barge “Herbert,” of which the decedent was captain, was docked at pier No. 3, at. Hoboken, and that the said barge was being used by the-respondent in connection with their contract for the Delaware, Lackawanna and Western Railroad Company; that the decedent apparently left the barge that day and was seen that evening by Daniel Turi at about seven-five P. M. near the First National Bank in Jersey City, at which time the witness spoke to the decedent, who was dressed in his working-clothes. The witness did not see him thereafter nor is there-any testimony introduced to show what became of ThaddeusAmbry beyond that time. It further appears from the testimony adduced that on April 30th, 1929, more than one month having elapsed from the time of his disappearance, the body of ’Thaddeus Ambry, the decedent, was seen by one Harry Moore, at which time there was a -rope about the body and it was made fast to pier No. 2, it appearing that the body had been recovered in the water and was being brought ashore. It was further brought out by Mr. William Teschmaker, who was the runner for the respondent, that according to the custom of the barge captains within the New York harbor, their hours were from seven A. m. to six p. m., and that at no time was the duration of a tow more than two and one-half hours; that the captains of the barges operated by this respondent were not on twenty-four-hour service-and that they were not required to have food aboard, but that they could if they so desired as a matter of convenience; that further, it was not necessary for the captain of the barge to be aboard the barge for same to be moved during the night by the Lackawanna tug.

This witness also testified that when he came aboard the barge “Herbert” on March 23d he found the cabin door locked; that he searched the entire boat without and found no trace of Thaddeus Ambry.

Susan Benson, the petitioner, testified that she was forty-seven years old and a widow, and that she had a daughter sixteen, who occasionally did some work, but that the decedent used to give her cash approximating $10 per week.

Robert Ambry, brother of the decedent, testified that he last saw the decedent on March 17th, 1929; that when he heard his brother was missing he consulted with the respondent and on March 27th he searched the barge in an endeavor to locate his brother, without success; he subsequently, when the body of the decedent was found in the water, identified the body as that of his brother, the decedent.

In every case before a petitioner can receive compensation they must establish an accident arising out of and in the course of the employment. This burden is imposed upon the petitioner by law, and I feel that, after carefully listening to and examining all of the testimony adduced, the petitioner has not sustained the burden placed upon her by law, in that there is not any testimony from which an inference might be drawn so as to show that the decedent met his death by an accident arising out of and in the course of his employment. At best, the testimony merely shows that he disappeared on or about March 32d and that his body was found in the water on April 30th, but there is no testimony adduced to show where he met his death or how he met his death, or any testimony to connect his death definitely with ah accident which arose out of and in the course of his employment.

Ckaeles E. Coeein, Deputy Commissioner.


author: John J. Stahl, Deputy Commissioner.

text:
    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    JOSEPH PRECKER, PETITIONER, v. A. FISHMAN HAT COMPANY, INCORPORATED, RESPONDENT.
    For the respondent, Turner & Stalter.

   The petitioner herein having filed his petition claiming that on January 17th, 1929, he was injured while employed as a sizer in the plant of the respondent by slipping off a platform and striking his right side against certain machinery, injuring his rib and other parts of his body, and the respondent having filed its answer and set up the fact that the petitioner was fighting with a fellow-employe and whatever injuries he received, if any, grew out of such fight, and the said cause having come on for hearing before me, and it appearing that at the time and place of the alleged accident charged in the petition, the petitioner engaged in fisticuffs with a fellow-employe, and while the petitioner was engaged in such fight he was pushed or knocked against his machine, thereby causing certain alleged injuries; and it further appearing that the said petitioner was not injured in an accident arising out of and in the course of his employment ;

I do therefore * * * find and determine that the petitioner was injured in a fight with a fellow-employe and that his alleged injuries did not arise out of his employment, and judgment is hereby entered in favor of the respondent and against the petitioner.

John J. Stahl, Deputy Commissioner.


author: W. E. Stubbs, Deputy Commissioner.

text:
    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    HERMAN BROWN, PETITIONER, v. HARRY GOTLIEB, RESPONDENT.
    Eor the respondent, Harry Adler.

    Eor the petitioner, Blealcly, Stoclcwell & Burling (by William S. Zink).

   *******

The petitioner was working for the respondent, and had been so employed for five or six weeks prior to September 6th, 1930, on which day he was sent by his employer with a truckload of merchandise from Rosenhayn, New Jersey, to New York City, with instructions to leave various shipments at definite points in that city. According to the testimony of the petitioner, which was not contradicted, there was a shipment of produce to be delivered to a Mr. Lavinsky, who had ordered a particular brand known as the “AP Brand,” and the petitioner testified that he was directed by his employer to deliver a different brand of produce to Lavinsky and tell him that he had none of the AP Brand. This the petitioner did, and then moved his truck a short distance along the same street to the Manhattan store, where he proceeded to unload other produce. About this time, Mr. Lavinsky chanced to pass by and noticed a quantity of the-AP Brand on the truck, and made inquiry as to why the AP Brand had not been left at his store. He insisted that the petitioner should take back the produce which had been left him of a different brand. This the petitioner declined to do, claiming that the merchandise had been signed for. Lavinsky returned to his own store, and brought two packages of, the goods which had been delivered to him and placed them on the rear end of the truck. Herman Brown, the petitioner, refused to accept these and states he dropped one of the packages on the sidewalk. Whereupon Lavinsky jumped on the truck and struck young Brown a severe blow on the jaw causing such injury that he was sent to a hospital by persons at the Manhattan store. None of these statements are contradicted by the respondent, who puts in a defense that he had directed all his drivers to either bring back to him goods which were not satisfactory or to telephone to him from New York. In the present instance there was no opportunity for Mr. Brown to carry out such instructions. The respondent further claims that the petitioner attempted to strike Mr. Lavinsky by throwing the package of produce at him. The petitioner denies this, and there is no substantiation by the respondent that he actually made such an attempt.

Whatever may be the general instructions of the employer to his drivers, it is quite evident that this entire unfortunate occurrence had its origin in orders issued to the petitioner to the effect that he was to make false statements to Lavinsky with regard to there being no packages of the AP Brand on the truck. The carrying out of these orders given by tile-respondent is responsible for the altercation and the injury to Mr. Brown, and I am unable to accept the conclusion that the respondent is free from any responsibility in the matter. There certainly resulted an untoward event not intended or designed by the petitioner, and under the definition of an accident as given by our Supreme Court, this injury must, be classified as an accidental one. Erom the testimony I conclude that the petitioner was disabled for twenty weeks,, and that he should, therefore, receive compensation at the rate of $18.33 a week, inasmuch as he was receiving pay at the rate of $5 a day, and the act specifies a minimum week as comprising five and one-half days. This will yield weekly wage of $27.50.

* ******

W. E. Stubbs, Deputy Commissioner.


author: Bbkky, V. C.

text:
    New Jersey National Bank and Trust Company, trustee under an agreement with Lincoln Mortgage and Title Guaranty Company, complainant, v. Berkshire, Incorporated, et al., defendants.
    [Decided July 30th, 1931.]

      Mr. Jerome G. Eisenberg, for the complainant.

      Messrs. Levy, Fenster ■& McGloslcey, for the respondent Harry Harris.
   Bbkky, V. C.

After bill to foreclose and lis pendens filed, and after final decree, the Acme Properties Corporation, of which the respondent Harris is president and owner, took a conveyance of the mortgaged premises from the mortgagor, entered into possession and began collecting the rents. After execution issued, and a few days before the sheriff’s sale, and also after the sheriff’s sale but before delivery of the sheriff’s deed, Harris collected rents not then due totalling $1,058. The sheriff’s sale was on January 6th, 1931, confirmed January lJth, and deed delivered January 24th. The rents collected by Harris were for the months of Eebruary, March and April, and due and payable on the first of those months respectively. The mortgage which was foreclosed contained an assignment of rents effective upon default. The mortgagee was the purchaser at the foreclosure sale and there was a deficiency. The Acme corporation and Harris had full knowledge of the proceedings and of the impending sale and of the purchase by complainant. Eor the purposes of this proceeding Harris and the Acme corporation may be considered as one. Harris’ collection of rents in advance of their due date is evidence of an attempt on his part to take everything of value from the property in anticipation of the sheriff’s sale, which he knew would inevitably result in his dispossession. When these facts were brought to the attention of the court, Harris was ordered to pay the rents so collected to the complainant purchaser. His counsel at that hearing admitted the rents w.ere collected wrongfully and that he had advised against it and agreed that they should be repaid. An order was entered accordingly. His client refused to obey that order and proceedings in contempt were instituted. In that proceeding, which is undisposed of, Harris put in three defenses: (1) that he was destitute and could not pay; (2) that he had spent the money in repairs and upkeep of the property, and (3) that the court had no right to order him to pay the rents to the complainant anyway and that he had appealed, or intended to appeal, from such order. In view of the proposed appeal, the contempt proceedings were held in abeyance, and these conclusions are filed after considering briefs of counsel on the main question: namely, the right of the court to order payment of such rents to the complainant purchaser. The following reasons are urged in support of the contention that the court erred in issuing the order directing the respondent to pay the rents, unlawfully collected, to the complainant purchaser:

1. No rights of the mortgagee or the purchaser have been invaded.

2. Complainant has an adequate remedy at law against the respondent.

3. Complainant is estopped from claiming the rents because he had no receiver appointed.

4. The relief sought cannot be had in a summary proceeding.

The argument advanced to sustain the first point is that the tenants paid rent in advance at the peril of having to pay it over again, and that they are still liable to complainant and he may collect from them. But this is immaterial. The issue here is not whether the tenants may be held liable at the complainant’s suit, but whether, under the circumstances here disclosed, the respondent is accountable to complainant for the rents wrongfully collected by him. It is admitted that he had no right to collect the rents, but he, in effect, says, “I collected them, but what are you going to do about it?” This argument is of no avail here.

The second point is naive, to say the least, in view of the fact that the respondent loudly proclaims his insolvency. A judgment at law against him would be of small value and the legal remedy, obviously, futile and inadequate.

As to the third point, no estoppel can arise in favor of any party by his own wrongful act. The failure of the complainant to have a receiver appointed gave the respondent no right to collect rents which the receiver himself, if appointed, could not have collected against the will of the tenants. The complainant is not estopped.

Nor is this a summary proceeding in the sense urged by the respondent. It is a step in the cause and pursuant to a decree subject to which the respondent acquired the property and which is binding upon him. A purchaser at a sheriff’s sale, when not a party to the original suit, is held to be made a party by the purchase so far as to be subject to the jurisdiction of the courts on questions arising from the sale. Shann v. Jones, 19 N. J. Fq. 251; Silver v. Camphell, 25 N. J. Fq. 465; Bowne v. Ritter, 26 N. J. Eq. 456; McCarter v. Finch, 55 N. J. Eq. 245. The same principle should apply where one with knowledge of the foreclosure proceedings purchases the mortgaged premises pendente lite, or after decree and before execution issued. In either case he steps into the shoes of the defendant mortgagor so far as the property is concerned and has no superior rights. He could, of course, properly be joined as a party defendant in the cause either on his own or the complainant’s application; or, indeed, on the court’s own motion. Chancery Rule 12. See, also, Riverside Building and Loan Association v. Bishop, 98 N. J. Eq. 508; Weinberger v. Goldstein, 99 N. J. Eq. 1; affirmed, 101 N. J. Eq. 310. For the purposes of this proceeding he is considered a party and if necessary an order to that effect will be entered.

Ample grounds exist upon which the court’s order may be sustained. The respondent’s act is a fraud upon the complainant. It is admitted that the respondent collected the rents wrongfully, and that the complainant was entitled to them. Under these circumstances, a trust by operation of law arose. The principle is laid down in 3 Pom. Eq. Jur. (4th ed.) § 1047. It is there clearly indicated that notwithstanding the complainant may have a right of action at law against the respondent, relief may also be obtained in this court, and in this connection it should be borne in mind that a considerable portion of the rents here involved were collected between the date of the sale and the delivery of the deed. During this period the respondent was trustee in fact of the mortgaged premises and their usufruct for the benefit of the purchaser. There is no doubt but that the trustee may be made to account in this proceeding, whether he be trustee by operation of law or otherwise.

But there are other grounds upon which the respondent may be held accountable. Recently Vice-Chancellor Buchanan held (In re Singer, 105 N. J. Eq. 220) that a plumber who had installed plumbing and steam heating apparatus in a building subject to a mortgage and who had not been paid could not remove such apparatus during the pendency of a foreclosure suit even though he was not a party to the proceeding and had no knowledge of it. He was held in contempt of court for unlawfully interfering with the subject-matter of the suit. The respondent’s position here is no better than that of the plumber there. The act of the plumber depreciated the value of the premises by injuring the freehold ; that of the respondent, by depleting the income. Both are on a par, with this exception—that the respondent is virtually a party to the suit and had full knowledge, while the plumber did not. The principle of that case is applicable here. But still another reason suggests itself for maintaining the court’s order. In Paramount Building and Loan Association v. Sacks, 107 N. J. Eq. 328, it was held that where each of three successive mortgages contained a clause assigning the rents and the third mortgagee enters into possession and collects the rents, he may be requird to account in equity to the prior mortgagees. See, also, Stanton v. Metropolitan Lumber Company, 107 N. J. Eq. 345; New Jersey National Bank and Trust Company v. Morris, 9 N. J. Mis. R. 444. The respondent is in no better position here than was the third mortgagee in possession there. Both derived their rights from a defaulting mortgagor and took subject to prior rights. Both are equally accountable to the prior assignee. The respondent’s rights are not superior to his grantor’s, who had already assigned the rents to the complainant. A receiver’s right to collect rent cannot be defeated by the tenant’s payment of rent in advance at the solicitation of the mortgagor in anticipation of the receivership. 42 C. J. 128 1704- The right of the mortgagee to receive the rents having accrued by virtue of the assignment (Paramount Building and Loan Association v. Sacks, supra; Stanton v. Metropolitan Lumber Company, supra), that right cannot be defeated by the collection of rents by the mortgagor, or one standing in his shoes, in violation of the assignment. The order will stand.

Counsel for respondent has urged that his client is entitled to a stay and a suspension of the contempt proceedings pending the disposition of this controversy on appeal. No stay will be granted unless the respondent deposits with the clerk of this court the amount of rents collected plus interest to the date of deposit. If such deposit is not made the proceedings in contempt will proceed.


author: Baches, Y. C.

text:
    Joseph C. Johnson, complainant, v. Martin J. Wehrle et al., defendants. Mary F. Brice, complainant, v. Martin J. Wehrle, administrator, &c., et al., defendants.
    [Decided September 17th, 1931.]

      Messrs. Howe & Davis, for the complainant Joseph C. Johnson.

      Mr. William 77. Hamilton Osborne, for the complainant Mary E. Brice.

      Mr. Henry 17. Dawson, for the defendants.
   Baches, Y. C.

These are companion bills; one by Johnson, a nephew, the other by Mrs. Brice, a sister of Catharine Beaver, deceased, intestate, to obtain possession of her estate under alleged oral contracts to leave to the nephew her entire estate and to the sister, her homestead outright and the income on $15,000 for life, in consideration that they serve her as long as she lived. The defendants are the administrator, the next of kin and the heirs-at-law of the intestate.

Neither complainant being a competent witness in his own behalf, they “cross-ruffed” their testimony in support of each other’s case and called the mother of the nephew and sister of the other complainant, a defendant in both suits, to witness that both contracts were made and made at the same time, though the one was inimical to the order.

Mrs. Beaver died in March, 1930, at the age of seventy-two, leaving a personal estate of $25,000 and the homestead, valued at $16,000. Her husband died two years before in June. The nephew, years ago, had made his home with them until he was sixteen and their intimacy continued and he regarded himself as 'their heir prospective; they had told him so. The sister had been all her adult life at service and at sixty-five, temporarily unemployed, came to the Beavers a few months before Mr. Beaver died, to assist in the household. The idea of leaving her estate to them came to Mrs. Beaver, according to the three principal witnesses, on the Sunday following Mr. Beaver’s funeral, while the four were on their way home from his grave after having stopped to see an old sick friend, Newman, whose forlorn condition provoked her to remark that, “I am going to take damn good care to fix things so it don’t happen to me.” They say that the sight of Newman preyed upon her so that she talked about it well into the night and the next day and that Tuesday, according to nephew Johnson who testified to his aunt’s claim, Mrs. Beaver said to him:

“ T am not going to be left alone and I do not want to be left alone, and I am going to make sure to have somebody with me. I want Mary to stay with me, but,’ she says, ‘Mary is used to having a day off, she is always feeling as though she wants to go—she likes to be free.’ She says, fif Mary comes with me she has got to stay with me, take care of my affairs, housekeeping and be with me at all times, but/ she says, ‘I spoke to Mary and Mary don’t seem to like the idea, and/ she says, ‘what can I do? What do you think I can do?’ She says, ‘I spoke about leaving her the house, but Mary don’t seem to be satisfied with it.’ She says, ‘what do you think would be necessary to induce Mary to stay here?’ She says, ‘I want to be positive that Mary will stay.’ I told her, ‘now, if Mary won’t stay here—she says the house don’t amount to anything because the income won’t take care of her, she will have to go out to work.’ That is what Mrs. Beaver told me. I said, ‘I suppose it would be the right thing if you suggest to her to give her a fund—that is, not to give her the money outright, but to give her a fund in trust on which she would get a regular income monthly.’ She says, ‘how much would it take to give her a monthly income ?’ Weil, then it was a question of how much income she wanted to give her monthly, how much she thought was proper and reasonable, if it would equal her old salary or less in consideration of the house. She said about equal to her salary at her other places. That was fixed around $900 and fixed at $15,000. She says, ‘I will put that proposition up to Mary.’ * * * It was a matter of a couple of days (later), as near as I can fix the time. It was either Friday or Saturday of that week. * * * My mother happened to be present. Mrs. Beaver called Mrs. Brice, my mother andl myself in the front room. ‘Now/ she said, ‘Mary, I want; you to stay with me/ and she says, ‘if you will stay with me-, I am going to give you this house outright/ but she wasn’t satisfied with that. ‘Now, I am going to give you a trust fund that will give you an income of $900 a year, that will make it unnecessary for you to go to work or to earn anything to support the house, and/ she says, T want you to. stay with me, do my work, do whatever I ask you to do, and' when I die, you will get the house outright, you will get this; trust fund. In the meantime I will give you five dollars a week for pocket money so that you won’t have to come to me and ask me for every little thing you need; I know you don’t feel -like doing that.’ * * * Mary said, ‘Kate, if you will do that, if you will do that, you will give me the house outright and you will give me that trust fund,’ she says, T will do what you ask me to do; I will stay with you for life; I will do whatever you want me to do.’ ”

Mrs. Brice, testifying for Johnson, says that when her nephew came Tuesday Mrs. Beaver said to him:

“ ‘I want to make an agreement with you that you stay and do anything that I ask you to do, to take care of my business and welfare and to be with me and take the place of my dear husband, that I’m afraid to be alone. * * * I want to be protected. I want a man in the house that I can trust to be with me.’ And the nephew asked: ‘Well, Aunty, how will I be protected in this regard?’ Adding, ‘I will do anything you tell me to do.’ She replied: ‘Why, I will make a will to that effect.’ ”

(Mrs. Brice failed to state what Johnson was to get.)

Mrs. Johnson, testifying for both complainants, says:

“Tuesday morning she asked Joe if he would take care of her business for her, look after her business, take the place of Uncle Will and do everything that she asked him to do, anything around the house, anything she asked him, that she would leave to him everything she owned. Then she said, ‘now, I want Mary to stay with me, and,’ she said, ‘Joe, do you think Mary will stay with me if I give her the home ?’ Joe said, ‘go and ask Mary.’ She asked Mary. Mary said she wouldn’t stay, what good was the house, she would have to go to work, she couldn’t live off the house, by the time the taxes was paid and all there wouldn’t be enough there to live off of, so then Mr. Johnson said to Mrs. Beaver, ‘you would have to leave her somthing more than that,’ so they figured out what it would he. By the time they had figured out the taxes, figured out the gas and-different things that had to he taken care of in the house I think there was something about a hundred dollars would he left, hundred dollars from the flat upstairs would he left from the rent of the flat. Mr. Johnson figured up that it would take $15,000 to give her $900 a year. I think that would be around about what Mrs. Brice had been in the habit of getting, about twenty dollars a week or something like that, I think. * * * Then Mrs. Beaver went back to Mrs. Brice and told her that she would give that—she wouldn’t give her the money, only the income off of the $15,000. Then Mrs. Beaver went back and asked Mary and Mary dillied around, she didn’t want to be tied down.”

“The Court—Were you there at all these-(interrupted).

“Witness—I was there that day, absolutely. But Mrs. Beaver wanted before that-(interrupted).

“The Court—I am wondering whether you wore there when she went to Mrs. Brice?

“Witness—No.

“The Court—Did you hear what she told Mrs. Brice?

“Witness—We were in the next room, right in the next room.

“The Court—You said she went to her?

“Witness—She called her in. She called her in. Because Mr. Johnson told Mrs. Brice—Mrs. Beaver if Mrs. Brice was to stay there she would have to provide for Mrs. Brice as she promised when she went there that she would provide.

“The Court—Now, please let us get what was said that day?

“Witness—She told Mrs. Brice she would give her the house outright and she would give her the income off of $15,000 and she said, “Mary, now understand, I do not mean $15,000, I mean just the interest off of it.’

“The Court—Now, I want to understand whether you were present when Mrs. Brice said the house itself would not be enough ?

“Witness—I was not in the room when she said the house itself would not be enough in the first place; she was out in the kitchen.

“The Court—You are telling me something then that somebody told you or you are guessing at.

“Witness—No; Mrs. Beaver went ont-(interrupted).

“The Court—Did you hear her ask her?

“Witness—Why, yes, we were in the next room. She went out-(interrupted).

“The Court—Did you hear Mrs. Brice object?

“Witness—Mrs. Brice?

“The Court—Did you hear her object?

“Witness—Yes, sir; she said she wouldn’t take the house alone because she couldn’t get along. Mrs. Brice was a very loud talker—very loud.

“The Court—Was anything said-(interrupted).

“Witness—Then Mrs. Brice said on that—she said—Mrs. Beaver said, ‘If you will give me the house-.’

“The Court—What?

“Witness—Mrs. Brice said, ‘If you will give me the house-.’

“The Court—Who said it ?

“Witness—Mrs. Brice said to Mrs. Beaver when she offered it to her after—after the amount was figured up, and she says, ‘if you will give me enough to live off,’ which Mrs. Beaver agreed to give her, the income, the $900, she says, ‘I will stay with you until your death, look after you and do everything.’ She says, ‘Kate; everything that you want me to do;’ and she even went further, she asked her how she would be protected in that. She says, ‘you know what kind of a family we got and I want to be protected so I can go out and make my money,’ she says, ‘and I know what I got and this way I don’t know if anything should happen to you.’ And Mrs. Beaver said she would make her will, see, to protect Mrs. Brice.”

Mrs. Johnson says Mrs. Beaver “rehashed” her promises on frequent occasions, once particularly, as she relates, a year later—

“Exactly the same thing right over again, and she said she would leave a will giving Joe and entire estate, but she says, ‘Joe, you will have to look after Aunt Mary to see, understand, if she dies, take care of all her affairs and see that Aunt Mary got the home and the income as long as she lives/ ”

Objection is made to the testimony of Mrs. Johnson as not competent under section 4 of the Evidence act. She is a co-defendant. Her interest in the subject-matter of the litigation is subordinate, not adverse to the rights of the administrator. The complainants had the right to call her, as they had the right to call the administrator or any of the other defendants whose interest is opposed to them to testify to conversations or transactions with the deceased. A party to a suit against an administrator whose interest in the matter in litigation is not adverse to the estate represented by the administrator is not disqualified as a witness under section 4 of the Evidence act. McCartin v. Traphagen's Adm’r, 43 N. J. Eq. 323. Mrs. Johnson was a qualified, though manifestly a biased witness in giving testimony against her own interest.

At the hearing, the testimony of the principal witnesses did not ring true, and, after reading the transcript, the then impression stands unmodified, that a contract with either complainant is not made out clearly, definitely and convincingly as the law demands in circumstances where temptation to perjury and the opportunity of fraud is so inviting and with little danger of detection. Vreeland v. Vreeland, 53 N. J. Eq. 387; McTague v. Finnegan, 54 N. J. Eq. 454. The stricture is in the abstract, but it is nevertheless felt that the parties knew the essentials of such contracts and that they persuaded themselves they existed. The Johnsons seem of a higher order of intelligence than Mrs. Brice. The nephew Johnson testified with great precision, presuming to repeat verbatim the oral contract with his aunt with an exactness that indicated careful preparation and perfection of manner to give force to his testimony; a lead his mother was unable to follow. She was far less orderly in her recital of events; confusing at times and at others in strange conflict with her son, viz.: According to his story, Mrs. Beaver told him Tuesday that Mrs. Brice had rejected the offer of the house and that he then suggested an annuity and figured it out and that she said she would “put the proposition to Mary,” and that Friday or Saturday following Mrs. Beaver called Mary to the front room where explicitly it was submitted and accepted. The mother says that Tuesday morning, after making the contract with her son, Mrs. Beaver asked him if he thought Mary would stay if she gave her the house and was told by him to “go and ask Mary,” and that in the kitchen, where she had gone, Mary refused; that after the annuity fund was figured out Mrs. Beaver returned to the kitchen and made the offer, but Mary “dillied” around, and that she called her in to the front room where the offer was formally made and agreed to by Mary. Now, if on Tuesday Mrs. Beaver already knew Mary had rejected the house, as the son says she told him, she was not in doubt about it and it is hardly likely that she went into the kitchen to make inquiry of Mary; and if on Tuesday the son calculated the annuity and Mrs. Beaver said she would put the annuity proposition up to Mary and it was not put up to her until Friday or Saturday, as the son says, what becomes of the mother’s “put and take” story of Tuesday? It is also somewhat difficult to understand that, with Mary in the house with her, in constant and intimate intercourse, Mrs. Beaver should wait until Friday or Saturday, until the nephew and his mother were again present, as the son maintains, before putting before Mary, and then in measured terms, the offer of the home and the annuity. If there was all this ceremony and formality in binding the contracting parties, one is prompted to ask why were the negotiations not reduced to writing? And if Mrs. Beaver made the promises and regarded herself in conscience bound, and she was an honest woman, nobody denies, it is odd that she did not heed the advice of her lawyer, Mr. Dawson, repeatedly made, to make a will. However, the discrepancies, if they do not indicate fabrication of the contracts out of a skeleton of circumstances, do at least contribute obscurity, indefiniteness and uncertainty. And when we add to the confusion, tlie conflict between the two alleged contracts and the nephew’s lame explanation to reconcile them, that he waived pro ianto his supposedly perfectly valid and enforcible contract to inherit the entire estate, so as to let in his aunt’s contract; the mother’s interpretation of the contracts, that her son’s contract was to be testamentar ily executed upon condition that he assure his aunt of tlie house and the .annuity; the fact that the nephew, ignoring his contract, preferred a claim against the administrator under oath for $10,000 for personal services rendered the deceased “for which she promised to pay the reasonable value thereof,” and the further fact that at a meeting of the next of kin to select from among them an administrator, neither of the complainants asserted his contracts, but instead, the nephew claimed that Mr. Beaver promised him his tool kit and Mrs. Brice claimed that Mrs. Beaver promised her her jewelry, all in proof, they leave the mind unconvinced and specific performance inadmissible.

This fact is also disturbing. Mrs. Brice alleges in her bill that the contract with Mrs. Beaver had its origin in an understanding with Mr. and Mrs. Beaver, that if she remained she should have the property at Mrs. Beaver’s death. She must have told that story to her counsel. Now, and in conflict, it is the testimony of the three principal witnesses that the contracts sought to be enforced were the spontaneous idea of Mrs. Beaver after she witnessed Mr. Newman’s distressed condition the Sunday following her husband’s funeral, to avoid a like experience.

Little account can be made of statements made by the deceased to strangers, of her intended disposition of her property, to support either contract. To some she said her nephew was to get all and to others that her sister was to have the homestead. They are as unreconcilable as are the alleged underlying circumstances from which it is sought to spell out contracts.

But assuming that there were contracts, they are not in writing, and performance claimed by the complainants is not marked by characteristics that will influence equity to-override the statute of frauds. There is an adequate remedy at law.

Johnson, the nephew, was to do errands, chores and the-like, anything he was asked to do. He testified only of things-he did for Mr. Beaver. His mother, in her enumeration of his services to Mrs. Beaver, adverted mostly to those rendered Mr. Beaver—gathering data and land values in anticipation of condemnation of some of his land and keeping a watchful eye on municipal proceedings to take the homestead in condemnation. Mrs. Beaver was capable of handling the business and she had Mr. Dawson as her legal advisor. A feeble effort was made to take the case out of the statute by a showing that his attention to his aunt’s affairs altered his-course of life and resulted in neglecting an oil burner business, to his loss. He is still in the business and as a sideline, is a detective, he says. The nature and extent of the oil burner business, a place, an agency or door to door salesmanship, is not disclosed, nor does it appear that degradation in occupation was caused by his devotion to his aunt and her affairs.

Mrs. Brice was a house servant from early girlhood, an exceptionally good cook, it is said, and, although aged and deaf, had employment. She had left her last job a week before going to the Beavers to help out. The alleged unusual service undertaken and rendered by her (calculated to take the-case out of the statute of frauds) of inestimable value to the-deceased and of unascertainable loss to her, that changed her whole course of life, was, that she engaged to be in constant attendance, never to leave the deceased alone, and resulted in the loss of her freedom—her Thursday afternoons out and' her evenings off, after work done. Her- routine work with Mrs. Beaver after Mr. Beaver’s death, in the small downstairs apartment of the homestead, only the two of them, and sisters, it is fair to assume was less laborious than in the households she from time to time served, and although it -does not appear that she had regular days off or her evenings out, it is not apparent that she was not at liberty to go at will, .■as she chose, and that she had not all the freedom and perhaps more than she enjoyed when working for strangers, for it is in evidence that she was taken out riding and was frequently seen on the streets. It is fair inference that restrictions of freedom, if any, found compensation in many privileges that are left untold.

It is felt that this hard-working work-out old woman found surcease, comfort and contentment in the home of her sister, where she was willing to be of service in the expectation of being rewarded by her rich sister, who, mayhap, held out the prospect. At all events, she did not step out of her ordinary vocation and if her work there was more arduous than in her other jobs, it is estimable by a jury. She will be left to her remedy at law. The case is ruled by Cooper v. Colson, 66 N. J. Eq. 328. The bills will be dismissed.


author: Pee Cubiam.

text:
    EDWARD O’LEARY, RELATOR, v. MORRIS REINER, RESPONDENT.
    Decided September 5, 1931.
    Before Gummbee, Chiee Justice, and Justices Tbenchaed and Lloyd.
    Eor the relator, George L. Burton.

    For the respondent, Francis P. J. Goan.

   Pee Cubiam.

Edward O’Leary, the relator in this case, was appointed.' a patrolman in the police department of South Amboy in 1921. In September of the year 1928 he was tried by the-common council upon certain charges lodged against him and was found guilty. As a result of this finding he was-removed from his position as patrolman, and thereafter, Morris Eeiner, the present respondent, was appointed as his-successor. On October 5th, 1929, more than a year after-his removal, O’Leary sued out a writ of certiorari to review' the proceedings under which he had been ousted. The hearing on this writ came on in due course and it was decided in favor of the municipality, the court considering that although in its opinion the common council was without legal, power to remove a policeman, that power being vested by the statute in the mayor of the municipality and not in the-common council, nevertheless, the failure of O’Leary to sue.out the writ until more than a year after his dismissal, was such gross laches as to disentitle him to any relief. This decision was handed down on the 1st of July, 1930, and thereafter, and on July 21st of that year, the present proceeding was instituted. In our opinion the reason which led this court to dismiss the certiorari is equally applicable to the present proceeding. Although it may be conceded that lapse of time will not bar the state through its attorney-general from successfully prosecuting a quo warranto proceeding where the rights of the state are involved, this doctrine has no application where the writ is sued out by a private relator. In such a ease, unreasonable delay on the part of the relator may properly preclude him from maintaining the proceeding. 51 Corp. Jur. 330, and eases there cited.

Eor the reason indicated the writ of quo warranto will be discharged, with costs to the respondent.


author: Pee Cueiam.

text:
    VAILSBURG AMUSEMENT COMPANY, INCORPORATED, APPELLANT, v. CRITERION INVESTMENT COMPANY, RESPONDENT.
    Decided September 5, 1931.
    Before Gum mere, Chibe Justice, and Justices Teen-chard and Lloyd.

      Eor the appellant, Richard J. Filz Maurice.-

    Eor the respondent, Saul •& Joseph F. Cohn.

   Pee Cueiam.

The defendant is the owner of a building which contains a moving picture theatre and two stores, located upon the corner of South Orange avenue and Telford street, in the city of Newark. The plaintiff is the lessee of the building. One of the provisions of the lease.required it to deposit with the owner of the property the sum of $12,000 as security for the faithful performance of the terms and conditions thereof; and that upon the vacation of the premises by the lessee or upon its failure to perform any of the terms and conditions of the lease, the owner should have a right to retain such fund as liquidated damages. The lease was for a term of fifteen years commencing on March 15th, 1921, the annual rental being $12,000 for the first ten years payable in equal monthly installments plus the payment of the annual taxes assessed against the property. The plaintiff entered into possession under the lease, deposited with the defendant the $12,000 required by the provision referred to as security for the faithful performance of its terms and conditions; rented the two stores to sub-tenants, and itself operated the theatre until sometime in June, 1927. At that time Telford street was improved by the city of Newark, with the result that the level thereof was raised about a foot and a half higher than the level of the doors of the theatre. Shortly after that, a license required to be obtained by the plaintiff as the operator of the theatre from the municipal authorities of Newark, expired, and it then applied for a renewal thereof. This application was denied upon the ground that since the raising of the grade of Telford street there was a lack of proper exits leading into it. Thereupon the plaintiff abandoned the further use of the theatre, refused to pay installments of rent thereafter accruing, and demanded the return of the $12,000 deposit, although it continued to collect rents from the sub-tenants occupying the stores up to the time of the institution of the present suit. The defendant refused to return the deposit and the plaintiff then instituted the present suit for the purpose of recovering the amount of that deposit, claiming that the refusal to repay it was without legal justification for the reason that there had been an eviction of the plaintiff by the defendant of that part of the leasehold estate used as a theatre, and that for this reason the plaintiff was under no obligation to continue the payment of rent or to continue the performance of any other of the covenants contained in the lease. The defendant, by its answer, denied its obligation to return the deposit, asserting that by the terms of the lease it was entitled to retain possession thereof, notwithstanding the fact that as a result of the elevation of Telford street, access to and egress from the theatre had been destroyed unless and until a change was made in the elevation of the entrance in the theatre to correspond with the new level of Telford street. It further contended that it was not in any degree responsible for the changed condition, and that therefore it was not guilty of the eviction claimed by the plaintiff; and that being so, was under no obligation to return the deposit money until the termination of the lease. It also counter-claimed for the unpaid rent and taxes that had accrued since the abandonment of the use of the theatre by the plaintiff and up to the time of the institution of the present suit. The trial resulted in the direction of a verdict in favor of the defendant so far as the plaintiff’s case was concerned, and also in the direction of a verdict in favor of the defendant on its counter-claim for rent and unpaid taxes. The present appeal is from the judgment entered on the verdicts both as to the plaintiff’s claim and the defendant’s counter-claim.

Taking up the question of the validity of the defendant’s counter-claim, we consider the trial court was justified in the course pursued by it. It is entirely settled by our decisions that in order to impose upon the landlord the penalty of a suspension of the entire rent during the continuance •of an eviction of a tenant from a portion of the premises, it is necessary that it appear that the eviction was brought about by the landlord himself, or by his agency or procurement. The facts already recited demonstrate that the defendant was not in any degree responsible for the raising of the grade of Telford street, and the refusal of the rnunieipality thereafter to grant a permit to the plaintiff for the carrying on of the theatre; and this being so, assuming that the action of the city, after raising the grade of the street, in refusing the permit, constituted an illegal infringement of the plaintiff’s rights, the landlord was in nowise responsible for it, and therefore it did not impose upon it the penalty of a suspension of the rent during the continuance of the eviction.

As to the claim of the plaintiff that it is entitled to recover the $12,000 deposited by it with the defendant as security for the performance of the terms of the lease, we consider that the trial court was justified in determining that by the terms of the lease the landlord was entitled to retain the possession of the deposit at least until the end of the term specified in the lease, or until the lease was earlier terminated by the consent of the parties, or by operation of law. The course pursued by the plaintiff of continuing to collect rents due from the sub-tenants occupying the stores, demonstrates that the primary lease was 'still in effect at the time of the institution of the suit, and as a result thereof the defendant was under no obligation to return the deposit money to the plaintiff.

Eor the reasons indicated the judgment under review will be affirmed, with costs to the respondent.


author: Per Curiam.

text:
    MORGAN RICHARDS, RESPONDENT, v. WATSON FLAGG ENGINEERING COMPANY, APPELLANT.
    Decided September 5, 1931.
    Before Gummere, Chief Justice, and Justices Trenchard and Lloyd.
    For the appellant, McDermott, Enright & Carpenter.

    For the respondent, Kent & Kent.

   Per Curiam.

The present suit was brought by the plaintiff to recover •compensation for personal injuries which, as he claimed, were the direct result of the negligence of the defendant corporation. The trial resulted in a verdict in his favor, the jury ■awarding him $36,000. A rule to show cause, with exceptions reserved, was then allowed the defendant, and upon the return of the rule the verdict was reduced to $26,000. The present .-appeal brings before this court for its consideration the questions involved in the reserved exceptions.

The American Can Company was having a factory constructed upon a tract of land owned by it and located on St. Paul’s avenue in Jersey City. The defendant corporation, at the time of the accident was engaged in installing an electrical system in the building under a contract with the owner.. The plaintiff was an employe of another concern, the Truscon Steel Company. This latter company’s contract required it. to do the structural steel work in the building. The plaintiff,, in the pursuance qf his work, walked across a plank in the building some seventeen feet above the floor, and while doing-so was injured by the breaking of this plank and his fall to-the floor resulting therefrom. The defendant company was-also using this plank for the purpose of supporting the cables-which it was installing. This was done by tying ropes around the plank and fastening them to the cables, suspending them some feet below the plank. The plaintiff claimed that defendant’s employes had full knowledge of the user of the plank by himself and his fellow laborers as a means of passage from one part of the building to another, and that the breaking of' the plank was the direct result of the excessive weight imposed upon it by persons crossing over it, plus the weight of the-cables suspended from it.

The first contention made before us is that the judgment under review should be reversed because of the refusal of the-trial court to grant a motion for a nonsuit, although, as-appellant asserts, it conclusively appeared that defendant’s-employes were not guilty of any negligence whatever in imposing this additional weight upon the plank, because they had no reason to suppose that by doing so they would endanger the safety of anyone walking across the plank; and that even if they were negligent in so doing, the plaintiff was equally negligent in attempting to walk over the plank, having at that time full knowledge of the existing condition. These matters, however, were disposed of by the determination of' the rule to show cause. It was contended before the trial court on the hearing of that rule that the finding of the jury that the defendant was guilty of negligence, and its further-finding that the plaintiff was not guilty of contributory negligence, were contrary to the weight of the evidence. As is-stated in the case of Catterall v. Otis, 103 N. J. L. 381, a reason assigned for a new trial that the verdict is contrary to the weight of the evidence, which reason was argued, considered and decided on the return of the rule to show cause, is necessarily embraced within exceptions to the refusal to nonsuit and to direct a verdict on the ground that there was no evidence of defendant’s negligence, and that contributory negligence of the plaintiff conclusively appeared, and bars the defendant from raising these same questions on appeal, notwithstanding that all exceptions were reserved by the rule.

It is next urged as a ground for reversal that the court ■erred in charging the jury that if the cable and sling of the defendant were affixed to the plank by defendant and were operated by defendant’s employes, and the defendant knew, ■or should have known, that the plaintiff and others employed there were using this plank as a means of passage, then the defendant owed a duty to the plaintiff to exercise reasonable care that the plank would not become dangerous to persons who might lawfully be upon it. In our opinion this is a ■correct statement of the law upon this subject, and the contention on the part of the plaintiff in error is therefore without substance.

Next it is contended that the court erred in charging the jury that if it found from the evidence that the defendant was ■chargeable with the manipulation of the cable which was attached to the plank and caused excessive weight and pressure to be brought upon it, and the other facts alleged in the complaint; and further found that the defendant was negligent with respect thereto, then it should consider whether such negligence was the proximate cause of the accident. This instruction, like that just commented upon, properly defined the legal rule applicable to the facts, and this ground of reversal also is without merit.

.It is further contended that the court erred in refusing to charge the defendant’s fourth and tenth requests. They are as follows: “4. The defendant was not required by law to anticipate that the plaintiff, a man weighing over two hundred pounds, would attempt to use this timber as a part of a continuous passage from one end of the building to the other at the same time that it was being used by the defendant as a support for the cables. 10. If the jury find from the evidence that defendant’s employes moved the timber in question on the morning of September 12th, 1928, to the position they indicated above this opening, and used this timber continuously until it fell with the plaintiff, then your verdict, must be for the defendant.” The only argument that counsel makes in support of his assertion that there was error in refusing to charge these requests is: “We respectfully submit that these requests are correct statements of the law and properly should have been included in the charge.” The fact that counsel makes no argument in support of this contention seems to us to indicate that he is not very much impressed with its soundness, and without the aid of counsel we have been unable to discover any error on the part of the court in refusing to charge these requests.

Lastly it is contended that the court committed error in its rulings upon certain testimony which is recited in the brief of the appellant. It is enough to say in disposing of this eontenton that we have examined the testimony referred to in the brief of counsel and find no error in the rulings thereon by the court.

The judgment under review will be affirmed, with costs.


text:
    EVERETT G. MacWHINNEY, PLAINTIFF-RESPONDENT, v. HERMAN JACOBSON, DEFENDANT-APPELLANT.
    Submitted February 2, 1931
    Decided September 1, 1931.
    Before Gummeke, Chief Justice, and Justices Tkenci-iakd and Lloyd.

      Eor the appellant, Merritt Lane.

    Eor the respondent, Orlando H. Bey.

   Pee Cubiam.

This is the defendant's appeal from a judgment of. the-Union Comity Common Pleas Court entered upon the verdict of a jury in favor of the plaintiff.

Briefly stated the situation was this: Plaintiff sued to-recover compensation which he alleged defendant had agreed to pay him for knowledge which he acquired for, and advice which he gave to, the defendant, in relation to the purchase and sale of stocks of four companies, and in particular for-advising defendant when to buy and when to sell these securities, with the result that during the period from January 1st, 1928, to January 31st, 1929, defendant invested in these securities a total of $197,592.50 and sold same for a total of $251,095.50, thus making a profit of $53,503.

Plaintiff claimed that prior to advising the defendant, regarding these securities, a verbal agreement was in each-case made, fixing the percentage of profit which plaintiff should receive as his compensation.

Defendant admitted that he had purchased and sold the-stock at the times and for the prices and with resulting profits, as stated, and it is not disputed that $11,035 for which the jury returned its verdict is the correct amount, including interest, which was due to plaintiff, if he was entitled to-recover at all. The matter was laid before the jury in a charge the accuracy of which is not questioned.

The sole ground of complaint now is that the court erred in refusing to allow the defendant to introduce in evidence-ail unanswered letter dated April 1st, 1929, containing self-serving declarations, alleged to have been written and mailed by the defendant to the plaintiff many months after the making of the oral agreement on which the suit was based, and which letter the plaintiff denied having received.

There was some testimony tending to show that the letter was mailed.

We do not find it necessary to determine -whether the denial of its receipt by the plaintiff overcame the presumption of its receipt and thus justified the rejection of the copy thereof upon the authority of Hand v. Howell, 61 N. J. L. 145; affirmed, Ibid. 694, as is argued.

Nor do we find it necessary to determine whether or not the letter was properly excluded under the rule stated in Hand v. Howell that the failure to reply to a letter not sent in the course of correspondence is not to be taken as an admission of the truth of its contents.

If it be assumed that the copy was technically admissible, we think that its exclusion should not lead to a reversal in the circumstances of the present case.

In this case the plaintiff had written a letter to the defendant on March 28th, 1929, in which he referred first to the $500 note which had gone to protest, and to the notice from the defendant of that fact. The letter then brings up the question of their other affairs, particularly with reference to an alleged agreement to pay twenty per cent, of the profits of the sale of the Lehigh Coal and Navigation stock. The defendant says that the rejected letter was in direct response to the letter of the plaintiff of March 28th, 1929, and in it the defendant repudiates any such obligation, and asserts that a check had been given in the July previous which was to settle any claims that the plaintiff had, or thought he had against the defendant.

As we look at it, the rejected letter at most does nothing more than put in writing the assertions made by the defendant on the witness stand that the stock transactions were closed and the plaintiff fully paid, after the plaintiff had put himself on record to the contrary. The mere failure, therefore, of the plaintiff to reply to the rejected letter (assuming that it was mailed and received) would be of doubtful evidential value, and in view of this posture of affairs we consider, after an examination of the whole case, that the error, if error it was, did not injuriously affect the substantial rights of the defendant, and therefore should not result in reversal.

The judgment will be affirmed, with costs.


author: Peb Curiam.

text:
    NELLIE WAGENAAR,, ADMINISTRATRIX AD PROSEQUEN-DUM, RESPONDENT, v. MAURICE FINKELMAN, APPELLANT.
    Decided September 10, 1931.
    Before Gummebe, Chief Justice, and Justices Trenchaed and Lloyd.
    For the appellant. Collins & Corbin.

    Por the respondent, Koch & Simon.

   Peb Curiam.

This suit was brought by the plaintiff to recover for the pecuniary loss sustained by the widow and next of kin of Peter Wagenaar by reason of his death resulting from the wrongful act, as alleged, of the defendant. The decedent was a tenant of the defendant, living in an apartment house in the city of Clifton. He was injured on the 20th day of August, 1928, by the fall of a part of the ceiling in the kitchen of his apartment, and as the result of his injuries died on the 24th day of September following. The trial resulted in a verdict in favor of the plaintiff and the defendant has appealed from the judgment entered thereon.

The first ground upon which we are asked to reverse the judgment is that the trial court committed error in refusing defendant’s motion to direct a verdict in his favor. The basis of the motion was that the present cause of action was barred by a release executed by the plaintiff’s decedent a few days after the happening of the accident. The release was admitted in evidence. It recited that in consideration of the sum of $75 paid by Einkelman to him, he, Peter Wagenaar, released and forever discharged the former, his heirs, executors and administrators from all causes of action, claims and demands whatsoever against said Einkelman, which he ever had or which “I or my heirs, executors or administrators hereafter can, shall or may have, for, upon or by reason of any matter, cause or thing whatsoever,” and was signed by Wagenaar. The plaintiff submitted testimony to show that the release had been obtained from Wagenaar by fraud. In this situation, conceding that the release, if valid, was a bar to the action, the court properly left the question of fraud in the obtaining of the same to be decided by the jury, and refused to direct a verdict for the defendant. Palmer v. Tomlin, 104 N. J. L. 215.

The only other ground urged for reversal is that the trial court erroneously permitted one Cornelius Wagenaar, a son of the decedent, to testify to a conversation relating to the execution of the release had in his presence between his father and one Kennard, the party who obtained it from the decedent. The testimony was objected to by defendant’s counsel upon the ground that it did not appear what connection Kennard had with the defendant, and that therefore whatever was said could not be binding upon the latter. The ground upon which the objection was based is, in our opinion, without merit. The defendant, in his answer, denies liability upon the ground that he is “a holder of a release signed by plaintiff’s intestate * * * and that the release states the consideration is $75.” There is no suggestion in the testimony that decedent ever signed any other release than that obtained from him by Kennard. The acceptance of the release by the defendant coupled with his claim that it is a bar to the suit brought against him by the plaintiff, raises the presumption that Kennard was acting as his representative in procuring it; and, this being so, the testimony of the witness as to the conversation between his father and Kennard which induced the father to sign the release, was competent.

The judgment under review will be affirmed, with costs to the respondent.


author: Caffeey, C. C. J.

text:
    MAY WERNER AND ANTHONY WERNER, HER HUSBAND, PLAINTIFFS, v. COMMONWEALTH CASUALTY COMPANY, DEFENDANT.
    Decided August 25, 1931.
    Eor the plaintiff, John J. Breslin, Jr.

    Eor the defendant, Morrison, Lloyd & Morrison.

   Caffeey, C. C. J.

This case was tried without a jury upon stipulated facts and testimony offered by plaintiffs and defendant.

Erom the evidence, it appears that May Werner was struck by an automobile owned and operated by Joseph Bongiorno on the 5th day of December, 1929. As result of this accident, Mrs. Werner and her husband, Anthony Werner, sued Joseph Bongiorno in the Bergen County Common Pleas Court, and on April 28th, 1930, judgments were entered in favor of May Werner in the sum of $9,000 and in favor of Anthony Werner for $3,000.

Pursuant to the judgments, executions were issued against the defendant and returned unsatisfied by the sheriff because of the insolvency of Bongiorno.

This present cause is against the Commonwealth Casualty Company, pursuant to public laws of 1924, chapter 153. This generally provides that in the event of insolvency of an assured, the insurer must respond in keeping with the terms of the policy.

Erom the evidence, it appears that prior to the happening of the accident, which serves as the basis of this suit, the defendant company paid $4,500 under this policy. This removes any doubt as to the issuance of the policy and recognition of its force and effect.

The defendant company contends, however, that at the time of the accident to Mrs. Werner, on December 5th, 1929, the policy had been canceled pursuant to clause H, which is the following:

“This policy may be canceled at any time by either of the parties upon written notice to the other party, stating when thereafter cancellation shall be effective and the date of cancellation shall then be the end of the policy period. If canceled by the assured, the company shall receive or retain the short rate premium calculated according to the table of short rates printed hereon. If canceled by the company, the company shall be ■ entitled to the earned premium pro rata. Notice of cancellation in writing, mailed to or delivered at the address of the assured as given herein, shall be sufficient notice, and the check of the company, or of its duly authorized agents, similarly mailed or delivered, shall be a sufficient tender of any unearned premium.”

Erom the testimony offered by plaintiffs and defendant, there is a dispute with respect to the payment of premium, however, I find as a fact that the premium was paid.

At the trial, the defendant offered in evidence a letter addressed to the assured, Joseph Bongiorno, which reads as follows :

“Please take notice that Policy No. 301374, issued to you by the Commonwealth Casualty Co., Philadelphia, Pa., is hereby canceled, pursuant to the terms and provisions in said policy contained. Such cancellation to take effect on the 8th day of October, 1929, at noon, standard time, at the place where said policy was countersigned. Please take special notice that all liability of said Commonwealth Casualty Company under said Commonwealth Casualty Company under said policy will absolutely cease at noon, October 8th, 1929, unless surrender thereof to said company be sooner made.
Very truly yours, E. W. Cook, Vice President.
Countersigned at Newark, N. J., this 3d day of October, 1929, by E. W. McDonough & Co., authorized representative.”

The envelope marked was addressed to Mr. Joseph Bongiorno, with the following notations:

“Mr. Joseph Bongiorno, 102 Sherman avenne, Clifton, N. J.,” - containing in the upper left-hand corner, “E. W. McDonough Co., Insurance, 17 Academy Street (at Broad Street), Newark, N. 3.” containing the rubber stamp mark “Registered,” “Personal receipt demanded,” and the number, “384501,” containing also the number, “21787,” and the stamp of the United States post office with a hand containing “Return to the writer unclaimed from Clifton, N. J.,” and containing the post office stamps on the back of the envelope.”

This was dated October 8th, some two months before the happening of the accident, wherein Mrs. Werner was injured.

There was no provision in the policy for the sending of a cancellation notice by registered mail, and the defendant company by doing this, and asking for a return receipt, assumed the responsibility of personal delivery to the assured.

The envelope and notice of cancellation were offered in evidence and opened in court by the counsel for the defendant, in the condition that it was returned to it by the postal authorities, at Clifton, New Jersey, so there was no question as to the non-receipt of same by Bongiorno.

While the facts in the case of Fritz v. Pennsylvania Fire Insurance Company, 85 N. J. L. 171, are different from those with respect to the matter sub judice, the language with respect to notice in order to effectuate the cancellation of policy makes it pertinent, the court there said: “Notice, therefore, to be efficacious to cancel the policy, must have been brought home to the insured—that is, brought to his personal attention—or, at least such a situation must be brought about as to put the insured upon inquiry.”

As this matter presents itself to this court insofar as the assured Bongiorno is concerned, he had no notice of the gesture on the part of the defendant company. I, therefore, find it as a fact that at the time of the happening of the accident on December 5th, 1929, the policy was in full force and effect subjecting the defendant company to liability under it.

Judgment will be entered in favor of plaintiffs in the sum of $10,000 with taxed costs, together with interest from April 28th, 1930.


author: Goldberger, J.

text:
    District Court of Perth Amboy.
    STATE BOARD OF MEDICAL EXAMINERS OF NEW JERSEY, PLAINTIFF, v. HARRY W. UCHIN, DEFENDANT.
    Decided May 1, 1931.
    Por the plaintiff, William A. Stevens, attorney-general (by Robert Peacock).

    Por the defendant, John E. Toolan and William J. Egan.

   Goldberger, J.

The defendant is charged with having commenced and continued the practice of chiropody without first having obtained a license therefor, in violation of section 8 of an act entitled, “An act to regulate the practice of chiropody, to license chiropodists, and to punish persons for violations thereof” (approved April 13th, 1909, as amended, &c.).

The facts, as they appear in the testimony, are that professional women investigators employed by the state did, on several occasions, enter the shoe store of the defendant, who appears to be a reputable dealer of some twenty years’ standing in the city of New Brunswick, and complained of pains in the feet. The dealer suggested that they bathe their feet in hot water, use soap, balm and powders; he also had the witnesses remove their shoes and. stand on a pedigraph (electrical machine) to take “a picture of their feet.” He finally sold them some nationally-known proprietary preparations in the original packages, having printed thereon a written statement as to their uses, and the price printed thereon. Defendant also sold a pair of arch supports. The dealer called their attention to the directions on the packages. He did not hold himself out as a doctor of chiropody, nor did he cut any corns or callouses, nor did he make any charges other than the printed price for the so-called remedies.

The statute does not define chiropody, and the court is requested to rely upon a witness for the meaning of the same. Said witness purports to be a graduate of a so-called Illinois College of Chiropody, and testifies that in his opinion the acts or treatments complained of was practicing chiropody. I do not agree with him, nor am I satisfied to take his testimony as being competent for that purpose. The act in question sets forth the requirements to obtain a license to practice chiropody, but nowhere does it reveal just what is meant by the practice of chiropody. There is no standard whatever set by the statute, or attempted to be fixed, by which a person may regulate his conduct.

I am not willing to convict a person for an act, the violation of which does not depend upon any standard established by the legislature which may be known in advance, but one created by the judiciary, which may be as varying and uncertain as the varying viewpoints of respective judges, and even which variable standards cannot be known until after the infraction of the acts complained of. As was said by Mr. Justice Holmes in Towne v. Eisner, 245 U. S. 418: “A word is not a crystal, transparent and unchanged; it is the skin of a living thought, and may vary greatly in color and content, according to the circumstances and the time in which it is used.”

It is the duty of the legislature to enact laws specific enough so that a citizen may be entitled to an unequivocal warning before conduct on his part, which is not malum in se, can be made the occasion of a deprivation of his liberty or property. Wester v. Hade, 52 Pa. St. 478; People v. Sherman, 100 N. Y. 351.

It is the duty of the judiciary to construe the laws that may be enacted by the legislature, although it is not for the court to enquire whether the legislature has violated the general principle of liberty and the rights of property, or whether its acts ar-e wise or expedient, or not; but, as I have stated, the statute, in my mind, is so incomplete that I am determined not to adjudge the defendant guilty of the charges preferred against him.

Laws are enacted to be read and obeyed by the people at large, and words in common use by the people should be given the same meaning in the law as they have among the people who are expected to read them. Adams v. Lansdon 18 Idaho 483.

While the removal of corns and callouses constitute chiropody, according to its common accepted definition, I am not ready to hold that the other treatments alleged to have been suggested by the defendant come within its scope. State v. Armstrong, 225 Pac. Rep. 491; 38 Idaho 498; 33 A. L. R. 836.

The complaint will he dismissed.


author: Backes, Y. C.

text:
    New Order Building and Loan Association, a corporation, complainant, v. Louis Landau, Ida Landau and Fannie Sabel, defendants.
    [Decided September 24th, 1931.]

      Messrs. Cohen •& Klein, for the complainant.

      Mr. Abraham Gurney, for the defendants Louis Landau and Ida Landau.
   Backes, Y. C.

The bill is to foreclose an $80,000 building and loan mortgage, because of default in monthly installments of principal and interest and the non-payment of taxes. The default in principal and interest is denied, but the proofs show the answer to be untrue. The charge of default in taxes, the defendants plead they have no knowledge. They are the owners; they know that they did or did not pay their taxes. Their answer is untruthful. The answer will be stricken out.

By the counter-claim, which must be accepted as true on this motion, the defense set up is that Morris Metsky, the president of the complainant, who represented himself as having full power and authority to do so, agreed that the complainant would credit them with all arrearages of installments of principal and interest and insurance premiums advanced, and arrearages of taxes, and pay all future taxes to September, 1931, and charge the same against the sum of installments of principal which had been paid, and alleged to be $11,000, and that in September, 1931, the complainant would recast the mortgage “on basis commonly known as a split or combination mortgage.” It is not alleged that the complainant made the agreement. The allegations that Metsky, the president of the complainant, represented that he had the power and authority to bind the complainant and that he agreed to charge the defaults to credits, is not a charge that the complainant agreed to the credits and to forgive the defaults and to recast the mortgage. If the defense has validity, the charge should be that the complainant made the agreement, or, if to specify, that the complainant through its duly authorized agent, Metsky, the president of the complainant, made the contract. That goes 'to the form of pleading.

The president of the complainant had not, as such, the authority to give the credit, nor to contract to recast the mortgage. What is meant by a “split or combination mortgage,” I am not informed, and it is not known in law. Further, the contract to credit and recast was without consideration and invalid.

Effort is made to show consideration, that the defendant paid off $2,500 on the second mortgage in consideration that the second mortgagee would subordinate to a split mortgage. It does not appear that the second mortgage was not due, and that $2,500 was paid in advance thereby creating a consideration, and it does appear that the second mortgage was a subordinate lien, and the agreement to subordinate was without consideration.

The interesting question is whether the president had the authority to extend the due date of the mortgage when he is the “whole show” of the building and loan; but that is not presented. The counter-claim is stricken out, but the defendants may have a perfect defense to the foreclosure, and twenty days will be given to again plead.

In the present depression, loan associations should be most considerate with their shareholders, who are trying to live up to their obligation, but cannot. If they are honestly applying the income of property to its upkeep and down keep of charges, building and loan associations should be patient.


author: Ackebson, S. C. C.

text:
    MERCHANTS REFRIGERATING COMPANY, PLAINTIFF, v. FENCHEL REALTY COMPANY, INCORPORATED, DEFENDANT.
    Decided September 21, 1931.
    Eor the plaintiff, Samuel L. Ilirschberg.

    For the defendant, I. Faerber Goldenhorn.

   Ackebson, S. C. C.

This is a motion to strike out the defendant’s amended answer as sham in part and frivolous in part, and for the entry of summary judgment.

After reading the pleadings and affidavits, I have reached the conclusion that the first seventeen paragraphs of the amended answer must be stricken out as sham.

The first special defense is payment through the sale of collateral security. This is evidently sham because there is nothing whatever in the defendant’s affidavit, submitted with this motion, to support it. The second special defense is to the effect that the defendant “had no power in law to make the contract in question, or to make or execute the notes in question, because the said act of the said corporation in doing the same was ultra vires.’1 This defense is clearly frivolous under the cases of Chapman v. Iron Clad Rheostat Co., 62 N. J. L. 497, and Camden and Atlantic Railroad Co. v. Mays Landing Railroad Co., 48 Id. 530, which are authorities for the proposition that when a person contracting with a corporation has fully performed his part of the contract and cannot be restored to his former status ox be honestly dealt with, otherwise than by holding the corporation to the performance of its share of the bargain, the plea of ultra vires by the corporation is inadmissible. The complaint before me shows that the plaintiff corporation guaranteed the payment of several notes, made by the defendant corporation, which were discounted at several banks and were not paid at maturity by the defendant; whereupon the plaintiff had to pay and did pay the same, and then sold collateral security pledged by the defendant with the plaintiff leaving a deficit for which the suit is brought. Certainly it will not do, under such circumstances, to say that the defendant, after having had the benefit of its dealing with the plaintiff, was engaging in an ultra vires act when the plaintiff cannot be restored to its original status except upon the payment of the balance due it. In the course of the opinion in the case of Camden and Atlantic Railroad Co. v. Mays Landing Railroad Co., supra, the court said: “Apply to it what legal phrase you may the underlying principle is that the corporation cannot set up its own infirmity when it is unconscionable to do so. The law forbids the defense on account of the flagrant injustice which would otherwise be done.” That is exactly the situation raised by the pleading under attack.

Counsel for the defendant, in his brief, seems to argue that Daniel Fenchel, although president of the defendant corporation, had no authority to execute the notes in question, and that the transaction was for his own personal benefit. It is a sufficient answer, however, to say that such a situation is not raised by the said second special defense which states only the defense of ultra vires.

The entire answer will therefore be stricken out for the reasons above stated, and although I do not have authority as a Supreme Court commissioner to order summary judgment, nevertheless this memorandum may be taken to Mr. Justice Campbell with my recommendation that summary judgment-be entered in the sum of $6,708.35, together with lawful interest thereon as set forth in plaintiffs’ affidavit.

An order may be presented to me striking out the entire answer as already indicated.