author: Stevens, V. C.

text:
    The Mayor and Common Council of the City of Newark v. Chestnut Hill Land Company.
    [Decided February 24th, 1910.]
    1. Where the defendant had instituted three actions at law for damages against different municipalities for decreasing the flow of a river, it was no ground for enjoining such suits and transferring the controversy to equity to avoid a multiplicity of suits that the actions at law would determine nothing but the amount of damages suffered by defendant for the past six years, and that there would or might be other similar actions brought in the future; the municipalities being able to prevent such actions by instituting proceedings to condemn.
    2. Because a tort is continuing, and will result in successive actions at law, does not entitle the wrong-doer to enjoin such actions, and have the controversy determined in equity.
    3. Where a property right is invaded by a corporation having the power of eminent domain, but there is no agreement, no inequitable conduct, no possession demanded, and nothing but the invasion of a legal right shown for which damages are sought at law, equity will not assume jurisdiction against the objection of the party injured.
    4. Where defendant brought several suits against municipalities to recover damages for interfering with the flow of a river, the mere complexity of the questions involved was insufficient to justify a transfer of the controversy to equity.

      5. Where a river was polluted by the sewers of a city and by several factories located along' its banks above defendant’s land, each was liable for the results of its own pollution only. In the case of several independent tort-feasors, each is responsible only for his own act.
    6. In an action at law by a riparian proprietor to recover damages for excessive abstraction of water by upper proprietors, laches is no defence.

      Mr. Herbert Boggs, Mr. Michael Dunn and Mr. William II. Gorbin, for the complainant.

      Mr. John W. Griggs, for the defendant.
   Stevens, V. C.

This is an application by the city of Newark to enjoin an action of tort commenced against it by the defendant land companjr. The land company is a riparian owner on the Passaic within Lhe corporate limits of the city of Paterson, and avers in its declaration that Newark has for the past six years withdrawn water from the Peqnannock river, one of the tributaries of the Passaic, in such quantities as material^ to affect the flow of the last-named stream, to its damage $50,000. It has also brought similar suits against the city of Jersey City and the East Jersey Water Company. The two municipalities and the water company have filed sej>arate hills to restrain these suits and to draw the litigation into this court — first, on the ground of avoiding a multiplicity of suits; secondly, because of the complexity of the problems involved; and thirdly, on the ground of laches. I do not think either of these grounds tenable.

First, as to avoiding a multiplicity of suits.

The land company has brought three suits at law against three independent corporations. It is not proposed to consolidate these suits into one and thus avoid a multiplicity of actions. It is proposed to have three suits in equity in their place. It is said that the actions at law will determine nothing but the amount of damages suffered by the land company for the past six years, and that there will or may be other similar actions brought in the future. The obvious answer is, that Newark and Jersey City may, at any time, institute proceedings to condemn, and that will prevent such actions. Besides, it has never been held that because the tort is continuing, the wrong-doer may come into this court. The privilege of so coming is, under some restriction?, that of the party injured and not of the party injuring. Says Chief-Justice Beasley, in Society v. Lehigh Valley Railroad Co., 32 N. J. Eq. (5 Stew.) 329: “Nor have I been able to find any authority for the doctrine that equity should intervene in order to avoid that multiplicity of suits that would be incident to the continuance of the legal jurisdiction. The rule is entirely settled that in case of private nuisance, the person injured may vindicate his rights by repeatedly suing the wrong-doer in a court of law.”

The cases cited by the counsel of the several complainants are not in point. Those principally relied on are Trenton Water Power Co. v. Chambers, 9 N. J. Eq. (1 Stock.) 476; North Hudson Co. v. Booraem, 28 N. J. Eq. (1 Stew.) 450; New York and Greenwood Lake Railroad Co. v. Stanley, 35 N. J. Eq. (8 Stew.) 283; Paterson v. Kamlah, 42 N. J. Eq. (15 Stew.) 93; 47 N. J. Eq. (2 Dick.) 331; Speer v. Erie Railroad Co., 68 N. J. Eq. (2 Robb.) 616; New York City v. Pine, 185 U. S. 98. With the exception of the last two, these were cases in'which possession had been taken by consent or agreement, and by companies which had the power to condemn.. The landowner was seeking inequitably to obtain possession after a long lapse of time and after works had been constructed. It was held that what the defendants were justly entitled to was compensation and not the property in its altered condition. The Speer Case, supra, is really an authority for the land company. Speer came into this court and asked for an injunction to restrain the company from obstructing his right of passage as he had theretofore enjoj^ed it. The court of errors and appeals ^denied him the relief that he asked, but said that he was entitled to compensation and expressly reserved to him his right to bring a suit at law, if he so desired. So in the Pine Case, while the supreme court of the United States refused to give the complainant an injunction to restrain the city of New York from interfering with the flow of the stream past his land, they gave him, at his election, the right to have his damages assessed by a jury. In Sparks Manufacturing Co. v. Newton, 57 N. J. Eq. (12 Dick.) 393; 60 N. J. Eq. (15 Dick.) 399, jurisdiction was taken expressly on the ground that both parties had agreed to its exercise. In Penrhyn State Co. v. Electric Light and Power Co., 181 N. Y. 80, a municipality had diverted water fifteen years before. The court refused an injunction, but said that if there were any damages the landowner had an adequate remedy at law.

The distinction seems to be this: Where there is an agreement or inequitable conduct or a question of the public welfare, there, at least in cases where the power of condemnation exists, equity may, in lieu of possession, give compensation. But where there is no agreement, no inequitable conduct, no possession demanded and nothing but the invasion of a legal right shown for which damages are sought at law, equity will not, against the objection of the party injured, assume jurisdiction to the exclusion of the law court, even though the corporation invoking its aid has the power to condemn. The argument addressed to me on behalf of complainants fails to take account of the distinction pointed out by Chief-Justice Beasley in Society v. Lehigh Valley Railroad Co., 32 N. J. Eq. (5 Stew.) 342. He says: “In all these cases [he was speaking of persons entitled to the use in common of a stream of water] the equitable jurisdiction was undoubted, as it was invoked by the party injured. In such cases courts’ of equity and courts of common law have concurrent jurisdiction, and, consequently, the complainant may seek either forum. That his relief may not be as complete in the forum which he chooses as it might have been in another forum, is a matter for his own consideration, and not for that of his adversary. The power to take charge, of the given case being co-ordinate, neither court can assume a paramount authority and compel an unwilling suitor to come to it for protection.” And Justice Depue, in Lehigh Valley Railroad v. McFarlan, 31 N. J. Eq. (4 Stew.) 754, thus expressed himself: “The appropriate relief against successive suits by the same plaintiff for damages arising from an injury which is continuous, is by application for the consolidation of actions, or for a stay of proceedings, and not by bill in chancery, unless the right in controversy has once been determined adversely to the plaintiff.”

Of course, where there is no right to condemn, there is the added objection that the complainant cannot compel his adversary to accept compensation as a substitute for the right invaded. Stout v. Portland Cement Co., 76 N. J. Eq. (6 Buch.) 518; Beach v. Sterling Iron Co., 54 N. J. Eq. (9 Dick.) 66, 79.

It is urged, in the second place, that the court should assume jurisdiction because the case is so complex that a jury cannot properly consider it. Complexity is no ground, per se, of equitable jurisdiction. Saj^s Chief-Justice Beasley, in the case already quoted (Society v. Lehigh Valley Railroad Co.) : “I cannot think that because the questions involved in this controversy are of magnitude or are intricate or difficult of solution, that therefore the courts of law can be divested of their jurisdiction over them. It does not appear that the importance of the matters in dispute have ever been regarded as affording any test of the cognizance of a court of equity.” The cases relied upon (Cranford v. Watters, 61 N. J. Eq. (16 Dick.) 284, and American Central Insurance Co. v. Landau, 62 N. J. Eq. (17 Dick.) 73) involved a voluminous account, and account is one of the subjects of equitable cognizance.

The land company is the owner of forty-ñve acres of riparian land. The land is unimproved and lies about four miles above the Dundee dam. This dam, according to Mr. Gardner’s affidavit, “sets the water back four and one-half miles in the -river to a point one-half a mile above defendant’s land,” in such a manner that

“the level of the water in times of low or moderate flow in front of defendant’s property is governed more by the draft of water from the mill pond than by the natural flow of the stream,”

and the water, he says, is not allowed to drop more than twelve inches below the level of the dam, “although sometimes, in dry weather, it drops a little more.” There is no appreciable fall of the river as it flows past defendant’s land, and therefore no question of water power. The Passaic has a tributary drainage area of about eight hundred square miles; a minimum flow of one hundred and eighty million gallons per day; an average flow throughout the year of one thousand million gallons per day and a maximum flow in flood times of not less than thirty thousand million gallons per day. The amount taken by Newark is thirty-five million gallons per day; by Jersey City, forty million gallons, and by the East Jersey Water Companjq for the use of the smaller municipalities — Montclair, Bayonne, &e. — eight million gallons. The question is, how does the withdrawal of this amount of water affect the flow of the stream as it runs past defendant’s land, and if the flow be diminished, is the land injuriously affected by the diminution? Defendant’s counsel thus states the problem: Determine the damage for the entire injury resulting from the abstraction of the eighty-three million gallons and then apportion it in the proportion of thirty-five eighty-thirds for Newark; forty eighty-thirds for Jersey City and eight eighty-thirds for the East Jersey Water Company. It is evident that the problem is not so easily solved. Counsel assumes actual damage ; but it does not follow that because eighty-three million gallons are taken from the stream or its tributaries, the defendant is necessarily injured. It has no property right in the water; only in the flow. In the words of Chief-Justice Gummere, in Doremus v. Paterson, 65 N. J. Eq. (20 Dick.) 712: “It is entitled to have the waters flow past its land undiminished in quantity and unimpaired in quality by the act of any other of the owners.” On proof that the upper owner withdraws more than he needs for domestic and other legitimate uses connected with the land itself, the lower owner is entitled to nominal damages. If he would recover more he must show actual injury. In the case of a piece of unimproved land, with no water power, actual or potential, and with the water maintained at a nearly constant level by the dam below, it may be open to question whether a diminution in the flow causes much or any real injury. But more than this, the assumption of diminution in the flow may not, in the case of Jersey City and Newark, be in accordance with the fact. These municipalities take their water from reservoirs filled in times of flood or high water. Mr. Gardner, speaking for Jersey City, and Mr. Sherrerd, for Newark, say that in times of very dry weather they allow an amount equivalent to the ordinary dry weather how to escape from their reservoirs. Of course, all that the riparian owner is entitled to is the customary flow. In times of flood it would be rather a benefit to the land to have some of the water withdrawn from it; in times of high water the diminution of flow could hardly be felt; in times of low water only could there be any appreciable injury, and even then that injury would be non-existent in the case of Newark and Jersey City, if the equivalent of the low-water flow should be permitted to flow from the reservoirs. We must take account, too, of the modifying influence of the dam. It is thus seen that the question is one of considerable complexity, but after all, one, only, of unliquidated damages to be determined, under the above authorities, by the courts of law.

I have altogether omitted any reference to the pollution of the river by the Paterson sewers and by the factories which discharge their waste products into the river above the defendant’s land. This does not add to the complexity of the problem, for it is clear that the complainants are not responsible for the damage thereby caused. In the case of several independent tort-feasors, each is responsible for his own act only. Even if the sewage be not so much diluted, and, consequently, more offensive to those who dwell along its banks, it is Paterson and the factories that are responsible for the pollution, and not Newark or Jersey City, or the East Jersey Water Company. In Doremus v. Paterson, 70 N. J. Eq. (4 Robb.) 296; on appeal, 71 N. J. Eq. (1 Buch.) 789, the city- of Patei^on, as a defence to the suit of the riparian owners, filed a cross-bill, making Newark and Jersey City parties on the ground that they were contributing to the injury by taking water that would otherwise have helped to lessen the nuisance. On application of the complainants the cross-bill was stricken out.

But one other question remains to be considered, that of laches. It is said that this court should interfere because of the long acquiescence of the land company. Laches would be an eqrdtable defence to a suit brought by the landowner to restrain Newark or Jersey City from abstracting the water. It is not a defence to the action at law. There the statute of limitations limits the recovery. In a case like tlie present, the land company cannot bring ejectment. It must come to this court for an injunction if it would seek to regain the full flow of the river. But if it does so, it may be met by those equitable defences which prevailed in the cases already cited. There is no equity that would restrain it from recovering damages for such injury as it may prove it has suffered for the last six years, but there may be an equity that would prevent it from depriving the people of Fewark and Jersey City of the use of the water in time to come, if those municipalities are willing to make compensation for what they propose to take.

The application should be denied.


source: Caselaw Access Project

author: Steven's, V. C.

license: Public Domain

text:
    George Kuntzman v. Harper B. Smith et al.
    [Decided March 22d, 1910.]
    1. The right of a senior mortgagee on the foreclosure of the junior mortgage is the right to foreclose, and not the right to redeem.
    2. The court in a suit to foreclose a purchase-money mortgage brought by the mortgagee against purchasers from the mortgagor may not order a stay until the mortgagee has procured releases that will perfect the title to the land which he conveyed to the mortgagor by deed containing the usual covenants of warranty and seizin.
    3. The covenant of seizin is broken, if at all, as soon as made. *
    4. The right of action for breach of covenant of seizin is in the grantee, and not in one claiming under him.
    5. The covenant of seizin is not broken by> the existence of easements or encumbrances not striking at the technical seizin of the purchaser, and a mortgage or an expectant right of dower does not affect the covenant.
    6. A covenant of warranty runs with the land.
    7. A breach of covenant of warranty does not arise unless there has been eviction by title paramount or by action brought.

      Mr. Joseph Iiaighn, for the demurrant.

      Mr. Eli II. Chandlerj contra.

   Steven's, V. C.

This is a demurrer to a cross-bill. The original bill seeks to foreclose .a mortgage made by Townsend Herbert to complainant in 1897. It is not pretended that this mortgage was not made as alleged or that it has been paid. The defence, by way of cross-bill, is that complainant, Kuntzman, on August 31st, 1897, was the owner of the property; that he, on that day, conveyed it to Townsend Herbert; that Herbert executed a purchase-money mortgage to Kuntzman for part of the price, and that at the time of the conveyance, Kuntzman’s title was defective in two particulars — first, in that there existed against it inchoate rights of dower; second, in that there was outstanding a mortgage for $845, not foreclosed in the suit in which Kuntzman acquired title, and in whose owner (Einge) there existed therefore a right of redemption. If the date of this last-mentioned mortgage is correctly given (1893), what Einge really has, however, if his mortgage be unpaid, is a right to foreclose and not a right to redeem, for the cross-bill alleges that the mortgage through which Kuntzman derived title was made in 1895, while Einge’s was made two years before. The cross-bill further alleges that Kuntzman having such defective title conveyed to Herbert “by deed (so the allegation is) containing the usual full covenants of warranty and seizin in fee-simple.” There is then the further allegation that Townsend “likewise” (whatever that word may imply) conveyed to Julia Herbert (without saying by what sort of a deed), and that Julia Herbert “likewise” conveyed to Wahl, and that Wahl “likewise” conveyed to Smith, the complainant in the cross-bill.

On this somewhat slender foundation, the cross-bill insists that by reason of the covenants contained in the complainant’s, Kuntzman’s deed, complainant “is liable to these answering defendants [the complainants in the cross-bill] to pay off, settle or otherwise procure an extinguishment of said liens and claims,” and that they are ready to pay complainant any and all sums found to be due “as soon as the liens and claims herein set forth are extinguished and canceled.”

Apparently, the pleader’s idea is, not that the court should ascertain the damages arising out of any breaches of covenant contained in the Huntzman deed and offset them against the amount due on the mortgage, but that it should order a stay until complainant has procured releases that would give a perfect title. It is needless to say that no such relief can be given.

The covenant of seizin is broken, if at all, as soon as made. Chapman v. Holmes, 10 N. J. Law (5 Halst.) 20; Carter v. Denman’s Executors, 23 N. J. Law (3 Zab.) 260. If there is any right of action, it is in Herbert, not in defendant. Besides, “it is well settled,” says Bawle, in his book on Covenants (at p. 63),

"that the covenant for seizin is not broken by the existence of easements or encumbrances which do not strike at the technical seizin of the purchaser. * * * .So with respect to a judgment, a mortgage, or the expectant right of the wife to dower, however much these may operate as a breach of the covenant against encumbrances, they do not affect the covenant for seizin since a judgment, or right of dower do not operate to divest the technical title or seizin of the grantor, and a mortgage, although in strictness it purports to pass the legal title, yet is almost universally regarded at the present day as a mere security for the payment of the debt.”

As to the covenant of warranty, which runs with the land, it is not alleged that there has been either eviction by title paramount or action brought, consequently no breach of covenant has been shown. Carter v. Denman, supra; Kuhnen v. Parker, 56 N. J. Eq. (11 Dick.) 286.

I think the demurrer to the cross-bill should be sustained.


author: Stevens, Y. C.

text:
    Percy S. Straus v. Anne Norris et al.
    [Decided March 22d, 1910.]
    1. In an action for specific performance, the vendor may recover the purchase price.
    2. A false representation must be false to the. knowledge of the person making it in order to sustain a legal action of deceit.
    3. Equity will relieve from false representations made in the sale of realty, whether they were intentional or made through mistake.
    4. Complainant sued to recover so much of the consideration paid defendant for land as would amount to the difference in value between a tract of eighty-two acres and sixty-nine acres, the bill alleging that defendant falsely represented, either fraudulently to induce complainant to pay a higher price, or through mistake, that the land contained the larger acreage. — Meld, that the chancery court has general .jurisdiction in eases of fraud, whether the legal remedy is adequate or not, though, where the legal remedy is adequate, it will not interfere unless justice will be facilitated thereby; that it would be in the present case, since, if- the misrepresentation was not knowingly false, a law court would not have jurisdiction, while the chancery court would, especially where the purchase price was so placed that a court of equity could impound it to abide the result.

      Mr. Edmund Wilson, for the demurrant.

      Mr. Enright, for the defendants.
   Stevens, Y. C.

The bill'alleges that complainant entered into a contract with defendant Noxris on July 22d, 1908, whereby Norris sold and agreed to convey to Straus certain farm lands 1

“containing eighty-two acres more or less, bounded on the north by the Chapel Hill road and lands of Corcoran and east by lands of Parmly and on the south by Navesink road and on the west by the New Jersey Southern R. R. for the price of $37,500.”

The agreement was carried into effect by a conveyance and the payment of all the purchase-money. The bill alleges that it was orally represented by Eorris that the premises contained an area of eighty-two acres and were part of a larger tract containing one hundred and fifteen acres, and that although the purchase price was fixed at a gross sum, nevertheless, in agreeing upon it, Straus relied upon said representation, and said price was fixed at the rate of, approximately, $450 per acre. The bill further alleges that Straus entered upon the land and had spent several thousand dollars in the improvement of it before he discovered £hat the representation was false in fact, and that the premises contained only sixty-nine and seventy-one one hundredths acres. He sues to recover back so much of the consideration paid as would represent the difference in value between a tract of eighty-two acres and one of sixty-nine and seventy-one one hundredths acres.

It is admitted that if the allegations of the bill are true, Straus .is entitled to recover, but it is said he should have sued at law and not in. equity.

It is well settled that in actions for specific performance the vendor may recover the price by suit in this court. The fact that a money judgment is sought is no objection. Moore v. Baker, 62 N. J. Eq. (17 Dick.) 208. It has also been decided that where a representation false in fact has been made, there is this difference between actions at law and suits in equity. At law, to maintain an action of deceit, the representation must (inter alia) be shown to be not only false in fact but false to the knowledge of the person making it, in other words, fraudulent. Cowley v. Smyth, 46 N. J. Law (17 Vr.) 380; Eibel v. Von Fell, 63 N. J. Law (34 Vr.) 3; 64 N. J. Law (35 Vr.) 364 Equity will relieve if the representation be false in fact, though no conscious fraud be perpetrated. Eibel v. Von Fell, 55 N. J. Eq. (10 Dick.) 670; Dubois v. Nugent, 69 N. J. Eq. (3 Robb.) 145.

The bill alleges that the representation was made either fraudulently, for the 'purpose of inducing complainant to pay a higher price, or through defendant’s mistake.

It is conceded by demurrant’s counsel that this court has -general jurisdiction in cases of fraud. The rule is thus stated by Justice Dixon in Eggers v. Anderson, 63 N. J. Eq. (18 Dick.) 265, in delivering the judgment of the court of errors and appeals : "The court of chancery possesses a general jurisdiction in cases of fraud, as well in cases where the remedy at law is plain, adequate and complete as in other eases; but when the remedy at law is plain, adequate and complete, the court of chancery is reluctant to exercise its jurisdiction, and will not do so unless the administration of justice’ will thereby, evidently, be facilitated.” In the case in hand it appears to me that the administration of justice will be facilitated, if this court takes jurisdiction. ■ In the first place, if the complainant should sue at law and should be able to show that the representation was material and false in fact, but should be unable to show that it was false to the knowledge of the person making it, he would fail; while here he would succeed. It would be an evident hardship to send him to law and then, if he failed, give him a remedy in this court, when this court is fully competent to pass upon the whole question. If, as the bill alleges in the alternative, there was mutual mistake, this court alone would be competent to deal with it.

Then the bill alleges that the price is still in the hands of the agent. This court is able to stay enough of the price in its hands to indemnify complainant, while at law the suit would be only against the principal for damages. No question is made of the jurisdiction to decree an abatement of the price when the acreage is materially less than that called for by the agreement.


text:
    East Ridgelawn Cemetery Company v. Adam Frank et al.
    [Decided April 8th, 1910.]
    1. 1 Gen. Stat. 1895 p. 81¡9 authorized incorporation of rural cemetery-associations to hold one hundred and thirty-five acres of land, and east the management thereof on trustees elected by the lot owners, and exempted the land from taxation, and provided that the lots from time of interment should be inalienable, and allowed the holding of property in trust to apply income to improvements, and the investment of money accruing from sale of lots for the purpose of improvement of the land, and also provided that at least one-half the-proceeds of all sales of lots should be first appropriated to the payment of the purchase-money of the land acquired, until the whole purchase-money should be paid, and the residue used to improve the grounds, and after the land is paid for future earnings from the sale of lots shall go to the improvement and preservation of the cemetery. By supplement of March 14th, 1879 (1 Gen. Stat. p. 851 § 16), it is provided that any creditor, in addition to his right to vote by virtue of owning lots, shall be entitled to one vote-for every $400 worth at par value of bonds, “stock,” or other duly authorized evidence of debt he may hold against such association. A cemetery association under the act bought land jointly with another association, each taking the limit of land allowed, and gave to the purchaser certificates of shares in the proceeds of the sale of the lots as consideration. — Meld, that the statute did not permit the giving of stock which at all times would be a lien on the proceeds, even after the lots were paid for; and hence the certificate issued by the association conferred no legal right, since it did not oblige the company to pay a definite price for the land, and disregarded the provisions obliging the company to appropriate one-half of the proceeds to the improvement of the property.
    2. Meld, also, that though the word “stock” was used in the supplement, it would be considered an inadvertence, and not sufficient to change the scheme of the statute.
    3. Neither would the scheme of the statute permit two companies, each holding the limit of land, jointly to buy land, and jointly to give certificates for shares for the purchase price.
    4. In a suit for specific performance of a contract to convey land, purchased by a cemetery association, and paid for by the issuance of certificates of stock, the association cannot urge that it is entitled to relief, without passing on the question of the validity of the certificate, when the bill on its face shows that the certificate was issued in disregard of the scheme of Gen. Stwt. p. SJ¡3, under which it was organized, and was the only consideration for the purchase.

      Mr. John B. Hardin, for the demurrant.

      Mr. Michael Dunn, contra.

   Stevens, V. C.

This bill is filed for the specific enforcement of an agreement to convey land and to pay off certain mortgages.

The complainant was incorporated September 30th, 1905, under the act to authorize the incorporation of rural cemetery associations. Gen. Stat. p. 349. After its incorporation it made an agreement (whether in writing or otherwise is not stated) with the" defendant, Frank and one Pond, who subsequently conveyed all his interest to Frank, that they should convey, or cause to be conveyed, to complainant, free and clear of all encumbrance, a tract of land in Aequackanonk township, containing one hundred and twenty-five acres. This tract, with the exception of two parcels of land containing, respectively, one and two acres, they did in fact cause to be conveyed, as agreed. They also agreed to convey such other land, not exceeding ten acres, as might be necessary for the purpose of straightening out the cemetery lands.

The bill alleges that it was also agreed that they would convey to the West Ridgelawn Cemetery Company, the complainant being known as the East Ridgelawn Cemetery Company, one hundred and thirty-five acres, “making,” so the bill states, “two hundred and seventy acres in all,” and would (I quote from the bill)

“accept and receive in payment and as a consideration price for said conveyance a certain interest in the proceeds of tbe sale'-of the said lands, after deducting certain charges and expenses and which interest in said proceeds of sale was agreed to be fixed at fifty shares per acre for the land conveyed to each cemetery, which amounted to 13,500 shares as the aggregate amount.”

The bill then proceeds to state as follows:

“And the said interest was to be evidenced by one or more certificates signed by your orator, and the said West Ridgelawn Cemetery (a body corporate) representing in the aggregate thirteen thousand five hundred shares and the same were to be issued and deliverd to the said Adam Prank * * * and that in pursuance of said agreement to purchase said lands your orator and the said West Ridgelawn Cemetery did issue and deliver to the said Adam Prank the said certificates evidencing such interest in the proceeds of sales to be made by your orator and the said West Ridgelawn Cemetery of the lands so conveyed and to be conveyed to them under said agreement.”

The bill further alleges that to better effectuate the performance of the agreement and to indemnify complainant against the paj’ment of the mortgages and to secure the conveyance of the remaining lands agreed to be conveyed, Erank assigned to the Passaic Trust and Safe Deposit Company certain of said certificates representing two thousand five hundred equal undivided shares in the said proceeds of sale of the lands of complainant and the said West Ridgelawn cemetery, in trust for those objects; that he has failed to pay off three mortgages on which there are now due $5,000, $3,750 and $5,500, respectively, and that he has failed to convey the remaining land agreed to be conveyed.

There are other allegations, but the above are the material ones. The complainant insists that it has a lien in equity on all shares issued “outside of the two thousand shares deposited with the trust company,” and asks for an injunction restraining Erank from disposing of any of the shares and for a decree directing Erank to pay the mortgages and to convey the lands agreed to be conveyed and for which he has already received the full amount of shares to which he was entitled, not only for the land actually conveyed, but also for that which he agreed to convey and did not convey. The prayer is, further, that on Frank’s failure to pay and convey, a receiver may be appointed to take Frank’s shares and he be required “to make abatement of said consideration of fifty shares of each acre of land which he fails to convey.”

The bill is notable for its omissions. It does not state within what time Erank was to pay off the mortgages or otherwise perform his agreement. It does not state whether the agreement was in writing, and, of course, does not append any copy of it. It does not set forth the terms of the written trust on which the trust company holds the two thousand shares; it does' not show why that trust cannot be enforced by the trust company, and it does not allege that the trust company has ever been called upon to enforce it.

It is, moreover, vague and uncertain on a subject of vital importance. It alleges that payment for the land was made by issuing certificates signed by the two companies representing “a certain interest in the proceeds of the sale of the said land” (without telling us what interest) “after deducting certain charges and expenses,” without telling us what charges and expenses. It merely says that said interest was fixed at fifty shares per acre and amounted to thirteen thousand five hundred shares as the aggregate amount, hfo copy of this novel certificate is appended, and we can only gather its terms from the above description.

This much is clear. The certificate is the joint certificate of both companies, and purports to give to the vendor thirteen thousand five hundred shares in the proceeds of the sale of the land as the consideration for twice one hundred and thirty-five acres, or fifty shares per acre, the maximum amount which a cemetery company may hold being one hundred and thirty-five acres. Is such a scheme authorized or permitted by the Cemetery act ? “A cemetery for the burial of the dead,” says Mr. Justice Gray, in Close v. Glenwood Cemetery, 107 U. S. 474, “if not a strictly charitable use, is, in some aspects, a public and pious use.” Our courts have táken a similar view (Newark v. Stockton 44 N. J. Eq. (17 Stew.) 180; Toppin v. Moriarty, 59 N. J. Eq. (14 Dick.) 115), and so has the legislature. The Cemetery act gives the management of the cemetery to trustees elected by the lot owners. It exempts cemetery lands from taxation and assessment. Rosedale Cemetery Association v. Linden, 73 N. J. Law (44 Vr.) 421. It provides that lots, from the time of interment, shall, in general, be inalienable.» It confers a limited power of eminent domain. It allows the association to hold property, real and personal, upon trust to apply the income to the improvement and embellishment of the grounds. It authorizes the investment of money accruing from the sale of lots for the purpose of maintenance and improvement (section 67), and it expressly directs as follows (section 19) :

“One-half at least of the proceeds of all sales of lots and plots shall be first appropriated to the payment of the purchase-money of the lands acquired by the association until the whole purchase-money shall be paid; and the residue thereof to preserving, improving and embellishing the said cemetery grounds and the avenues and roads leading thereto and to defray the incidental expenses of the cemetery establishment; and after the payment of the purchase-money and the debts contracted therefor and for surveying and laying out the ground, the proceeds of all future sales shall be applied to the improvement, embellishment and preservation of such cemetery a.nd for incidental expenses and to no other purpose or object so long as such embellishment is incomplete.”

The only intimation that cemetery companies may issue stock is to be found in the supplement of March 14th, 1879 (Gen. Stat. ¶. 351 § 16), referred to in the opinion of Vice-Chancellor Pitney, in Ransom v. Brinkerhoff, 56 N. J. Eq. (11 Dick.) 149. It is there provided that “every creditor, in addition to his right to vote bjr virtue of his owning lots, shall be entitled to one vote for every $400 worth at par value of bonds, stock or other duly authorized evidences of debt he or she may own or hold against such association.” As to this, Vice-Chancellor Pitney said: “The existence of stock or shareholders is not contemplated by the act nor consistent with the legislative scheme. * * * By implication, the language recognizes the right of the association to make use of the machinery of certificates of stock to manifest a debt owing by it; but clearly it left the owner a mere creditor, and no more; for it is as a creditor only that he is authorized to vote for the trustees.”

It is quite plain that the insertion of the word “stock” in the supplement was a mere inadvertence, and that, if this provision be still in force (see supplement of March 17th, 1893, Gen. Stat. p. 357 §§ 46, 47), the so-called stock can be nothing more than an evidence that a specific sum of money is due and owing by the corporation to the creditor.

The question then is, how does the certificate issued by the two companies harmonize with the legislative scheme as thus outlined ?

By the scheme' under review no purchase price is fixed. The certificate holder receives either the whole or a part of the proceeds of the sale of the burial lots up to the time that the last lot is sold. He thus gets the benefit of the sums expended for improvement and embellishment, whether those sums be derived from donations or from the proceeds of the sales of lots. He makes a profit out of their exemption from taxation and levy, and even from the possible exercise of the power of eminent domain. The statute contemplates the purchase of the land for a definite price; but under the scheme in question there is no price, in the ordinary sense. The grantor either appropriates the whole of the proceeds of the sale of the lots, “after deducting certain charges and expenses,” or at least a part, and if a part we are not told how much. On the face of the bill there is nothing to indicate that the certificate is consistent with the provisions of the statute, and much to indicate that it is not. The certificate appears to be open to the following objections:

First. It is the joint certificate of two companies that have no statutory power to enter into a joint undertaking that makes each liable for the moneys received by the other.

Second. The contract expressed in the certificate appears, as far as we can gather from its contents, to disregard entirely that provision of the law which obliges the company to appropriate one-half of the proceeds of the sale of its lots for the preservation and embellishment of the cemetery property and for incidental expenses.

Third. The certificate does not oblige the companies to pay a definite price for their lands, but, like the ordinary stock certificate, appears to give an indefinite interest in earnings. The certificate holder becomes virtually a partner, sharing in the gains, but not liable for the losses. It is not likely that the legislature intended to confer immunity from taxation and levy, coupled with the power of eminent domain, in order that some individual might make an increased profit out of those extraordinary powers and immunities. At all events, there is no warrant in the statute for such a certificate, and it is out of harmony with the general scheme of the act.

It is argued that the court may give relief without passing upon the question of the validity of the certificate. But the relief asked is specific performance of an agreement to convey land and to pay off mortgages; the consideration, and the sole consideration therefor, being the certificate in question. If, on the face of the bill, such a certificate appears to confer no legal right, I do not see how it can be successfully contended that the court can decree for complainant. It only decrees a specific performance where it finds that a valuable consideration has been given. Here the consideration is a stipulation for an interest in tire proceeds of the sale of lots; a stipulation that the companies have no right to give.

I think the demurrer should be sustained in this as well as in the similar case of the East Eidgelawn company.


text:
    In the matter of the dissolution of the Senora and Sinaloa Irrigation Company.
    [Decided April 18th, 1910.]
    The statute (P. L. 188// p. 285 § 5) provides that if the tax of any company remains unpaid on the first day of July after the same becomes due, it shall thenceforth bear interest at one per cent, a month until paid, and makes such a tax a preferred debt in case of insolvency (§ 6) for which an action at law may be maintained. The Corporation act (P. L. 1896 p. 296 § 56) provides that, when any corporation is dissolved in any manner whatever, the court of chancery may appoint one or more receivers, with power to prosecute and defend in the name of the corporation or otherwise, and section 54 of that act makes the directors trustees, with authority to recover debts and property in the name of the corporation upon its dissolution in any manner. — Held, that franchise taxes due from a corporation bear interest at twelve per cent, until paid, even after dissolution of the corporation by executive proclamation ; the interest being preferred, as well as the debt.

      Mr. Robert H. McOarter, for the petitioners.

      Mr. Edmund Wilson, attorney-general, for the state.
   Stevens, V. C.

The trustees of the above company which was, on January 5th, 1904, dissolved by proclamation of the governor, ask this court whether they must pay interest at the rate of twelve per cent, per annum on its unpaid franchise taxes. This tax for the year 1901 was $231; for 1902, $300; and for 1903, $300. The trustees concede that they are bound to pay the principal, with interest, at the rate prescribed by the Taxing act, up to the time of dissolution, but they submit that the interest then ceased to run, if not altogether, at least at the rate of twelve per cent. I have not been referred to any case which supports their view, and it seems untenable. The statute (P. L. 1884 p. 235 § 5) provides that

“if the tax of any company remains unpaid on the first day of July after the same becomes due, the same shall thenceforth bear interest at the rate of one per centum for each month until paid.”

The argument in behalf of the trustees is that interest is given because of default in payment, and that there can be no default where there is no existent corporation.

There has been no disposition on the part of the court of errors and appeals to relieve corporations in the hands 'of receivers of their obligation to pay taxes. This is strikingly shown by the case In re United States Car Co., 60 N. J. Eq. (15 Dick.) 514. In that case the chancellor had held that the assets were held in trust by its receiver primarily to pay those who were creditors at the time the trust property passed into his hands, and that a tax upon the corporation subsequently imposed could only be paid out of the surplus, if any remaining, after such creditors had been paid in full. The court of errors and appeals held that the tax was payable out of the assets and was preferred. It so held, although the statute calls the tax a franchise tax, and although by the express words of section 68 of the Corporation act, the franchises and privileges of a corporation are transferred to the receiver at the time of his appointment. The bare legal entity was held to be subject to the imposition, and this imposition was paj^able out of assets to which the corporation no longer held the legal title.

The decision does not dispose of the present question, for here we have the case of a legal entity, not only stripped of its property and franchises, but actually declared to be dissolved. The question here is, does the interest run on notwithstanding the dissolution? The language of the act seems to indicate that it does. Fothing could be more general or more explicit. The tax remaining unpaid shall thenceforth bear interest at the rate of one per centum for each month until paid; and “shall also be a preferred debt in case of insolvency.” P. L. 1884 p. 236 § 6. If there were nothing but insolvency, it could not, in view of this language, be argued that interest did not run in the case of a tax imposed before insolvency. It is, however, said that there is not only insolvency but corporate death working an extinguishment of corporate obligation to pay interest from the time of death; for how, it is asked, can there be obligation without an obligor ? The answer is, that the receiver or trustee is substituted by law to perform the obligation, as far as tire assets extend. The case of Rosenbaum v. Credit System Co., 61 N. J. Law (32 Vr.) 546, throws light on the question. There, suit was brought by an agent on a continuing contract to serve the Credit System Company for a term of years, unexpired when the company failed. A receiver was appointed and the company’s charter declared forfeited. The supreme court treated the contract as one for skilled personal service, and held that it was terminated by the dissolution of the corporation as it would have been by the death of a master. But the court of errors and appeals held otherwise. It declared that the court below had overlooked the fact that the capital of the corporation stood as a trust fund for the payment of its debts, and that by the terms of the decree, which forfeited the defendant’s charter, the corporation was not dead, so far as the ascertainment of its obligations and their satisfaction was concerned. It was held that the forfeiture of the charter did not bar the plaintiff’s recovery of damages for failure to perform the terms of the contract unexpired at the date of that forfeiture. Strictly speaking, it is impossible for a corporation to violate the terms of a contract after its power to act has been taken from it and it has ceased to exist. But, nevertheless, a remedy was given against the assets as extensive as that which would have been given against the corporation had it remained in esse and refused to perform. The case seems to go to quite the length of the attorney-generahs insistment in the present ease. The decree in that ease did, indeed, declare the charter forfeited, with the reservation “except for the purpose of collecting the property and assets of the defendant,” but this is substantially the statutory reservation in all cases of dissolution. Section 56 of the Corporation act provides that when any corporation shall be dissolved, “in any manner whatever” (of course, including dissolution by proclamation), the court of chancery may appoint one or more persons to be receivers, “with power to prosecute and defend m the name of the corporation, or otherwise ” and section 54 provides that upon the dissolution, “in any manner ” of any corporation, the directors shall be trustees with authority to sue for and recover debts and property, “by the name of the corporation ” and shall be suable by the same name or in their own names.

From this it is apparent that although the corporation is dissolved, the legal entity is still deemed existent for the purpose of suing and being sued. If, in this condition, it can be liable for unliquidated damages accruing after decree of dissolution, why should it not be liable for interest on the tax when the statute itself says that the tax shall bear interest until paid. Section 6 of the act of 1884 provides that “the tax, when determined, shall be a debt due from such company to the state, for which an action at law may be maintained.” If this state should institute an action, how could the corporation, in view of the principle established in the Rosenbaum Case, plead in defence its own death as a bar to a recovery? If the statute has attached interest to the debt, I do not see how it could resist the entry of judgment for both principal and interest.

It is said that the common practice is for the receiver to calculate interest on claims presented and allowed, up to the time of his appointment, just as the assignee calculates interest up to the date of the assignment. Pritchett v. Newbold’s Executors, 12 N. J. Eq. (Saxt.) 571-574. If this be the correct practice, it does not help’ the petitioners’ case, for the legislature can make a different rule in the case of claims or debts, to which it gives a preference. As the debt is preferred, so is the interest. Both are preferred to their full extent and must be paid before unpreferred claims are paid.


author: Stevenson, V. C.

text:
    William A. Freda v. Hattie Bergman, alias Hattie Freda.
    [Submitted April 4th, 1910.
    Decided May 13th, 1910.]
    1. A suit to annul a marriage on the ground that defendant had at the time a former spouse, is not a suit merely to relieve the private grievance of complainant, but the state is also concerned, and the interests of innocent unborn children may also be involved.
    2. The denial of a decree annulling a marriage, where its nullity has been absolutely established by the proof of a • living spouse of one of the parties, does not establish the legality of the second marriage, but the party competent to marry may immediately marry another, and the other party may do likewise after his incapacity has been removed by the death or divorce of his spouse.
    3. Where the proof in a suit to annul a marriage fails to show that the marriage is void, the decree should so recite and adjudge, and dismiss the bill on that ground.
    4. A man marrying a woman having a former husband may sue to annul the marriage, though he was guilty of negligence in relying on her statements that she had been divorced from her former husband.
    5. Where the nullity of a marriage has been established by clear and convincing evidence, a bar to an annulment thereof should also be established by clear and convincing evidence before a decree of nullity is denied.
    On bill for decree of nullity of marriage. Heard on exceptions to master’s report in favor of dismissal of bill.

      Mr. John P. Manning, for the complainant.
   Stevenson, V. C.

In this ex parte case the learned master reports that the marriage in question was null and void, but further reports that the complainant is not entitled to a decree of nullity because he was cognizant of the prior marriage of the defendant, and that such marriage remained undissolved. It is perhaps not quite clear whether the master found, as a matter of fact, that the complainant had actual notice of the incapacity of the defendant, and believed that such incapacity existed, or was merely guilty of negligence in relying “wholly upon the statement of the defendant that she had been divorced from her husband,” and in refraining from making “inquiries with reference to the time when or the circumstances under which the divorce had been obtained.”

1. The doctrine which has the strong support of Vice-Chancellor Pitney, and which apparently must be regarded as one of the grounds upon which he rested his decision in the case of Rooney v. Rooney, 54 N. J. Eq. (9 Dick.) 231, 245, in my opinion should not be extended.

The Rooney Case, when confined to its facts, merely decides that when a married man induces a woman innocently to go through a form of marriage with him by falsely representing himself to be single, and cohabitation and pregnacy of the woman thereupon follow, he cannot come into a court of equity and relieve himself of his obligation to support his victim by obtaining a decree 'declaring his bigamous marriage void. The opinion of the learned vice-chancellor, however, deals with the whole subject of the policy of permitting a party who has been guilty of knowingly attempting a bigamous and therefore void marriage, to obtain a decree declaring the fact that such bigamous marriage was void ab initio, and the American decisions and the English decisions are exhibited as generally in conflict on this subject (at p. 243). See 1 Bish. Mar. D. & S. § 722; 2 Nels. Div. & Sep. § 590.

The correctness of the narrow proposition established by the Rooney Oase, or of the wider propositions upon which Vice-Chancellor Pitney cites and discusses' authorities, seems to depend on the question whether this sort of a matrimonial cause in the court of chancery of New Jersey is strictly of “an equitable nature and subject to the rules and maxims of courts of equity, rather than those of the English ecclesiastical courts.” Rooney Case p. 242.

In the case of Kretz v. Kretz, 73 N. J. Eq. (3 Buch.) 246, Vice-Chancellor Learning regards this question as still in doubt in this state, but declares himself in favor of the views expressed by Vice-Chancellor Pitney.

(1) The doubt in regard to this subject grows out of the unique character of all matrimonial cases involving either the existence or the continuance of the marriage state. In this class of cases, it is not the private grievance of the complainant alone which is considered, and which controls the nature and extent of the remedy, if any, which may be granted. The state is often called a “third party” to every suit for divorce or nullity of marriage. But not only the' state is concerned, but the interests of innocent unborn children may be involved. If a decree of nullity is deuied, where nullity has been absolutely established by the proofs, the legality of the marriage is not established. Rooney v. Rooney, supra. The fact that the marriage was null remains. One of the parties may immediately contract another alliance, and the other party may do likewise after his incapacity has been removed by the death or the divorce of his spouse. Questions of the utmost importance affecting innocent children relating to property and relating to status, may subsequently come up when the proof of the nullity of the marriage in question may be beyond reach.

It seems to me that it is a sound proposition, in point of ethics and public policy, that a person in the situation of this complainant should not contract a lawful marriage with anyone without giving such lawful spouse and her possible children, in every case where it is practicable, the protection of a decree declaring his prior attempted marriage void. There is also, I think, abundance of room to argue that a similar duty rests upon a bigamist who, after his void marriage, becomes capable of marrying again by the death of his spouse, and thereupon proposes to enter into a valid marriage with an innocent party. As long as a person is permitted by law to contract marriage, it is somewhat difficult to see why all the safeguards possible should not be thrown around such lawful marriage which the law favors. With the outstanding record of the prior marriage, the officers, of the state having the prosecution of crime in charge might be embarrassed in determining whether or not there should be an indictment for bigamy.

It may be conceded most amply that if the sole effect of declining to make a decree which merely establishes a fact found to exist, is to punish a guilty party by exposing him to inconvenience, the general equitable rule requiring the complainant to appear with clean hands might be enforced to its full extent and in all its rigor. But the difficulty to my mind arises from the fact that the interests of the state and of possible innocent unborn children require that the status of the citizens of the state in respect to marriage should, as far as possible, be made certain and kept free from doubt. I cannot avoid grave doubts as to the soundness of any rule which permits a man to marry but undertakes to punish him by exposing his marriage to doubt and question, and his innocent wife and children to all the evil and injury which flow from such doubts.

(2) The complainant is not asking a court of equity to aid him in securing the proceeds of any crime or other wrong-doing on his part. There is á wide difference between large classes of cases where complainants are denied “relief” in a court of equity because they come into that court with unclean hands, and this unique decree which is rendered in a suit merely to establish the fact that a marriage was null and void ab initio. The complainant’s benefit from this decree, as I have endeavored to suggest above, is oftentimes a negligible quantity compared with the benefit which innocent parties and the state may derive from such decree. The complainant is not asking for any property; he is merely asking for a judicial declaration of a fact to which the court cannot shut its eyes, and in the ascertainment of which great interests beyond those of the complainant may be involved.

(3) In many cases of the class under consideration the decree dismissing the bill of the complainant on the ground that he was either alone guilty- or -particeps criminis with the defendant, would seem to establish the nullity of the marriage. Following the master’s report the decree in this case would recite that the marriage was void, but that because the complainant knew it was void, the bill must be dismissed. The decree dismissing the bill therefore seems to be necessarily based upon a finding of the fact thus made res adjudicada between the parties that their marriage was null.

When a decree recites that the marriage was null and void, but because the complainant knew that it was null and void, he shall not have a judicial declaration to that effect, it would seem that the very result which the decree undertakes to avoid is secured on behalf of the complainant and all parties who may afterwards be concerned. It is true that the decree, by concealing the honest finding of fact which the court makes, may, in some cases, avoid this result.- In all cases where the proofs fail to show that the marriage was void, the decree should so recite and adjudge, and dismiss the bill on that ground.

(4) If the complainant thought he was in form entering into a void marriage, contrary to the laws of the state, and contrary to public policy, when he files his bill to obtain a decree of nullity, may he not be deemed as coming into court repenting of his wrong-doing and asking to have his wrongful act, as far as possible, undone, so that all injurious effects in the future which might result from that wrongful act upon innocent parties and upon the state may be absolutely prevented ? If the complainant was the bigamist in the transaction, he remains liable to an action at law for damages on behalf of the other party, if such party was an innocent victim. 19 Am. & Eng. Encycl. L. 1219 note 5; 2 Nels. Div. & Sep. § 1023. By obtaining a decree that his fraudulent colorable marriage was void, he does not injure his innocent victim, but, on the contrary, aids his victim in recovering her damages.

My conclusion on this branch of tire present case is that a decree of nullity cannot be withheld without extending the authority of the Rooney Case into a. wide field where I may be obliged to follow, but am unable to lead.

2. The proofs fail to satisfy me that the complainant believed that the defendant was still the wife of the man whom she had formerly married. His positive testimony to the effect that the defendant told him that she had been divorced and that he relied on such statement should probably be accepted, notwithstanding the testimony of the defendant’s sister to the contrary. The bar to relief set up by the Rooney Case, whatever may be its exact scope, or by other American cases, must, I think, necessarily include guilt, bad faith, on the part of the complainant in entering into the bigamous marriage. ETo case which I havei seen suggests that mere negligence resulting from foolish credulity is sufficient.

It is plain, also, I think, that after the nullity of the marriage has been established by the full measure of proof properly required any bar to a decree of the sort which has been herein considered, should also rest upon clear and convincing evidence.

The exceptions will be sustained and a decree of nullity advised.


author: Garrison, V. C.

text:
    Henry Beck v. Mary Beck.
    [Decided January 31st, 1910.]
    1. In order to establish a gift of personal property by husband to wife, there must be clear and convincing evidence of delivery by the husband to the wife with the intention of divesting himself of all dominion and control over it, and of vesting title in the wife.
    . 2. Where a husband and wife in humble circumstances both labored for the .mutual betterment of their condition, all the earnings being delivered to the wife, who acted as the treasurer of the family, such facts were insufficient to justify a presumption of gift on the part of the husband of his earnings to the wife, and waiver of all interest therein.
    3. Where a husband and wife engaged jointly in operating certain saloons, the proceeds of which were delivered into her custody as were also the earnings of the husband from other sources, and those of the children, all being held by her in a common hoard, from which she purchased real estate, taking the title in her own name, from which, after separation, she endeavored to exclude him, they would be held in equity to own the property as tenants by the entirety.

      Heard on bill, answer, replication and proofs in open court.
    This is a bill filed by a husband against a wife to have property standing in her name decreed to be his. The facts will appear in the discussion of the proofs.

      Mr. Fred Lieffenbach, Jr. (with whom was Mr. Squier, of the New York bar), for the complainant.

      Mr. August Ziegener and Mr. J. Merritt-Lane, for the defendant.
   Garrison, V. C.

The parties are Germans and were married in 1885, at which time the man was employed at small wages in a brewery and the woman was a domestic servant. He was then aged twenty-six and she was twenty-three. They went to live in modest quarters-in a flat in New York, and he gave to her each week all of his wages earned at the brewery. They only paid eight or ten dollars a month for rent. The husband had about $350 at the time of their marriage, and the wife says that she had $100, although the husband denies this.

Still living in New York, they next moved into little better quarters, where they paid $12 a month rent, and continued there until 1892, when they moved to a house in which there was a saloon, at Eifty-seventh street, between Second and Third avenues. Here the rent was either twenty-five or twenty-seven dollars a month.

In the place in which they lived immediately before they moved to Eifty-seventh street, and in Eifty-seventh street,- there-were boarders. All told, some boarders were kept during a period of about four years.

The husband opened a saloon in the premises on Eifty-seventh street, having purchased the business for $1,300, $600 of which he paid in cash, and gave a mortgage for the $700 balance. Of this $600 the wife contributed $200, and, subsequently, got it back by talcing it from time to time out of the earnings of the business.

. The earnings from this saloon went partly, if not wholly, to the wife, as did also all of the money that was taken in from the -boarders. This continued until 1895, when they sold this business for $1,300, the money going to the wife. The $700 mortgage was taken over by the purchaser, so that what they got was clear.

They then purchased a saloon business at Morrisania, New York, he putting up $450 and the wife $300, which $300 was subsequently taken back by her out of the earnings of the business. The license fee for this saloon was raised from $200 to $800, and this was more than the business could stand, and they only stayed there for ten months, and practically lost the money that was put into that business. The fixtures of this saloon, when they took it, were encumbered by a mortgage held by one Stevenson.

They then lived in New York, not carrying on any business for some months, until, finally, in August of 1896, the husband met a friend who told him that he owned a propertyin Jersey Oity which had a saloon in it, and the husband came over to see it, and, subsequently, took his wife to see it, and they determined to take it. They purchased this property for $2,300, all cash. There is a dispute bétween the parties as to how this sum was made up. It is undisputed that $400 was borrowed from a Mrs. Opell, and $200 from the sister of the husband. The husband’s testimony is that he furnished $600 and his wife $1,100. Her testimony is that she furnished the whole $1,700 that was not borrowed as above stated. They both agree that whatever money she furnished was what she had saved out of keeping boarders and the receipts of the previous saloon business, and his earnings given by him to her from time to time, as he always had given them to her up to this time, and continued to do down to the time of the separation between them, which will hereafter be described.

They immediately moved over to this property, No. 169 Columbia avenue, Jersey City, and opened the saloon. At first, the license was in the name of the husband. The wife at one time sought to have the license put in her name; but by reason of a rule of the excise commissioners of Jersey City, which forbids the issuance of licenses in the names of married women, this was impossible, and, as the complainant remarked to the excise commissioner, that it made no difference in whose name the license was, it continued to be taken in his name.

The saloon business, in 168 Columbia avenue, was opened on the 1st day of December,-1896, and did not at first yield enough profit to support the family. The husband, therefore, sought work elsewhere, and secured a position at the American Lead Pencil Company, at Hoboken. His hours there were from seven in the morning until six at night, and he has worked there from 1896 to date. His wages began at $5.50 per week, and have gradually advanced until he is now receiving $11 a week. All of these wages were turned over every week by him to his wife, saving the following amounts, which she gave him back for his personal expenses: At first, $1.25; then $2.75, and finally, $3 a week.

The man would go to his work, as above stated, at seven o’clock in the morning, after having first opened the saloon at five o’clock. He would return about six-thirty and attend the saloon while his wife got her supper, and would then be in and about the saloon until it was closed. During the rest of the time the wife and the older children ran the saloon.

As the children grew up and became able to earn wages they went out to work and turned their wages over to the mother.

The $100 borrowed from Mrs. Opell and the $200 borrowed from his sister Lizzie Beck were repaid to them out of the earnings of the 'saloon business — or out of those plus his earnings and the earnings of the children, because they were all mingled.

This practice of mingling the earnings, and of the wife keeping all the money, continued down to the time of the separation of the parties on the 8th of November, 1908. The parties had been living unhappily together for some little time before this, and finally quarreled, and she refused to permit him to enter the house, and since that time has kept him out.

The saloon business was sold in December, 1907, for $1,100, which was paid to the husband, and which he handed over to the wife. Later, at Christmas, she gave him $500 in cash.

About five years after they opened the saloon, and on the 1st of July, 1903, a vacant lot at 39 Nelson avenue, which adjoined the saloon property on the rear and through which access could be gained to a street, was purchased in the wife’s name for $625, which was paid in cash out of the joint hoard in the hands of the wife.

On the 18th of December, 1905,171 Columbia avenue was purchased, and $1,500 cash was paid out of the same source, and the deed taken in the wife’s name.

On the 4th of October, 1906, No. 169 Columbia avenue was purchased out of the earnings of the business,, and $2,200 cash was paid for it out of the same source, and the title -was taken in the wife’s name.

The husband testifies, with respect to the first purchase of property, namely, 168 Columbia avenue (that in which the saloon was), as follows:

“We spoke together before we bought the house, and my wife says ‘It is better I bought the house in my name on account of the mortgage that David Stevenson holds in Morrisania for that saloon.’ The mortgage was about nine hundred dollars, and she says ‘It .is better I buy the house in my own name on account of the nine hundred dollar mortgage of David Stevenson,’ and she says ‘It belongs just the same to you and to me.’ ”

She denies that she suggested that the title be taken in her name on account of the Stevenson mortgage, and I think it likely that she is telling the truth with respect to this, because the Stevenson mortgage was not given by Beck, and he was not in any way liable upon it. It is, of course, possible that people as ignorant as these people are may have thought that they were liable on a mortgage which -was on the fixtures when they bought them. The wife does not give us what actually happened at this time, but here, and throughout the case, tries to suggest that the man was drunken, shiftless and lazy, and that she was the earner, and that he recognized this and acquiesced in her going into business by herself for herself. This is opposed by every proven fact in the ease. The man, from the earliest record we have of him to date, has been hardworking and saving.

There was practically no difference in the family custom from the beginning of their married life to the time of the separation. Whatever he earned in outside occupations went to the wife; the money from each saloon they ran was taken charge of by the wife; the children’s earnings likewise went to her, as did the money paid by the boarders.

A curious and illuminating incident occurred during the cross-examination of the husband: The wife’s lawyer was endeavoring to show, by subtle and clever methods, that a distinction existen between the way the parties treated the business in Jersey City and those theretofore carried on elsewhere. He said to Beck: “When you were up at Morrisania you ran it [the saloon] yourself ?” And the answer was, “Yes, sir; no, me and her ran it all the time.”

With respect to the vacant lot on Nelson avenue, it appears that the husband agreed that that should be bought to benefit the property that they already had; and when his wife consulted him about it, he agreed that it should be bought. He denies that he knew of the purchase of the other two pieces of property until after they were accomplished facts. The wife and one of the children testify that he did know, because they told him. They testify that he said, when the mother spoke of buying this property, ox these properties, “All right; do as you like.”

Upon this state of facts, the contention of the respective parties is, on the part of the complainant, that since all of the money was either earned by him, or by a business which belonged to him, or by his minor children living with him, or by his wife in keeping boarders at his home, he is entitled to the property purchased with such money; on behalf of the defendant, that since the properties stand in her name and were purchased with money which was in her hands at the time of the purchase, she must be held to be the owner thereof. In other words, each of the parties claims the ownership to the exclusion of the other.

In the case of Fretz v. Roth (Vice-Chancellor Garrison, 1904), 68 N. J. Eq. (2 Robb.) 516, I had occasion, in considering one of the questions which I thought involved in that suit, to investigate the state of the law with respect to the ownership of money earned by the husband and by the wife in a non-independent business and accumulated in her hands. This ease was reversed in the court of errors and appeals — 70 N. J. Eq. (4 Robb.) 764 (1905) — but not upon any point touching the subject-matter now being dealt with.

The reversal was upon the ground that since there was a direct conveyance from the husband to the wife the presumption of gift was not overcome by the proofs and there was no legal evidence of a trust. The wife’s contention was that the money arising as aforesaid from her husband’s earnings and her own in a nonindependent business, being in her hands, she owned the same, and the original purchase of the real estate having been made with such money, the property was hers, even though the title was taken in her husband’s name. My examination into this subject was to ascertain whether that contention was sound, and I reached the conclusion that it was not, and upon this point the decision of the court of errors and appeals, sub silentio, would seem to have concurred. Because, if this contention was sound, then she was the equitable owner of the property from the beginning, and the subsequent deed of the husband to her would not have evidenced, as the court'of errors and appeals held it did, a gift to her, but would have been merely the transfer of the legal title to the equitable owner. Unless, therefore, I was correct in holding that the moneys were his and the equitable and legal title his before he deeded to her, both the court of errors and appeals and I erred as to what the point of that case was because we each conceived the point to be whether he gave to her, or did not intend a gift. As before stated, if the property, by reason of the source of the money, was already in equity hers, his subsequent deed could not be considered in any view as a gift.

I made my investigation as to the law relating to the ownership of moneys accumulated as aforesaid with as much care as .possible, and the conclusions which I then reached have since' been confirmed by my experience in many similar cases.

My views are so fully expressed (at p. 528 et seq.), and the authorities which I was able to find are so fully cited and quoted in that opinion, that T shall not attempt to restate at any length my view, as a reading of that case will disclose the same.

Among people of the class of which these people are — the man a laborer, and the woman a servant — I cannot possibly believe that it is proper to find that the usual customary habit of such people, which is to constitute the wife the treasurer and to turn all money from every source over to her, should be held to constitute a gift of such moneys to her.

The court of errors and appeals, in the case of Farrow v. Farrow, 72 N. J. Eq. (2 Buch.) 421, held that “a gift of personal property from husband to wife must be clearly proved. There must be clear and convincing evidence of a delivery of the property by the husband with the .intention of divesting himself of all dominion and control of it, and of vesting title in the wife.” I cannot find from such custom or habit any such intention as the court in the above case just cited requires to be found to constitute a gift. I do not find that the husband intended to divest himself of all dominion and control of such moneys.

I do find an intention of a character hereafter defined and enforced.

In the case at bar the wife never engaged in any business apart from her husband. All the money that went into the purchase of these properties was either earned by the wife in keeping boarders or by the husband in whatever business he was engaged in, or in saloons jointly attended to; and the question to be determined is whether the fact that the title to the real estate thus purchased was taken in the wife’s name is determinative of the question.

In Fretz v. Roth it was held to be such, because, as before pointed out, the court of errors and appeals found that the husband, having conveyed directly to the wife, there was no evidence of any kind which rebutted the presumption of a gift, and the principle of improvidence did not apply. • But this case is clearly distinguishable from Fretz v. Roth, because the conveyances to the wife in every instance here were from strangers and not from the husband. Fo citations are needed for the principle that presumptions of a gift from husband to wife may be rebutted.

There is no doubt in my mind that among the class which are low wage-earners, where the wife is almost invariably the treasurer, and all money from every source is taken care of by her, there is no intention to be inferred therefrom that she is the sole owner of all such.'money. On the other hand, it will invariably be found (and has in many similar cases been found by me) to be the fact that such people intend the wife to have an interest in the money thus placed in her hands, or in that into Which such money is put. And this I believe to be legally proper) because while the husband does not, in handing the money to the wife, intend to make a gift to her of all of it, he undoubtedly intends that she shall benefit therefrom; and while he does not specifically agree with her concerning the matter, there is, I think, a perfectly clear implication from their conduct that they are each jointly entitled to what is thus jointly made, saved anc^invested. And I think it perfectly clear, as I set forth more at length in the opinion in the Fretz Qase, that the real intention is that it is a joint hoard, and that when real estate is purchased with such money, and title taken in the wife’s name, I think the perfectly clear intention of the parties is that they own by the entireties.

They undoubtedly intend, with respect to such money and such real estate, to enjoy it in common during their lifetime, and to have it go to the survivor at death. And I know of no reason why a court of equity, when called upon to pass upon this question, should not give that intention effect.

One cannot read the testimony in this suit without reaching the conclusion that this man and wife were laboring jointly fom a joint purpose, to accumulate what they could for each other. There is no doubt that the husband’s strict common law right is to take all of his earnings and all of the earnings of his wife and children, and, subject to his duty to support her and them, to do as he pleases with the balance. There is, similarly, no doubt that if a husband passes personal or real property to his wife, it is presumably a gift to her. But it is beyond peradventure true that, among j>eople of the humbler class, the usual course is neither one of these two. The man does not even keep his own earnings. All money, from every source, goes to the wife. And all through this suit it will be found that the husband speaks of the wife as “saving' money,” “that the money was given to her to save,” and he never calls her to account for the money that she received personally from the boarders, or from any other source than himself.

I believe that it would be rank injustice to hold, in such cases, that all of the money, as against the wife, belonged to the husband; or that ail of the money, as against the husband, belonged to the wife. I believe, as above stated, that it is the thorough understanding of such people, and therefore their intention, that such moneys are theirs jointly; and wherever it is possible for a court of conscience to give effect to this understanding and intention, I think it should do so.

I, therefore, in this case find that the presumption of a gift of the whole of this property to the wife is rebutted, and that it was the intention of the husband at the times that he permitted his wife to have all of the money, and the property in which the money was put, to vest her jointly with himself with an interest therein; and I therefore find that the properties in question are held by the wife as if she and he held by entireties, and will advise a decree accordingly.

The form of the decree will be settled upon notice. In determining upon the form the case of Duvale v. Duvale (Court of Errors and Appeals, 1897), 56 N. J. Eq. (11 Dick.) 375, should be consulted, since somewhat similar relief was therein granted.

If, by reason of the nature of the equity found in favor of the complainant an amendment of his bill is necessary, his counsel should move, for and obtain leave so to amend.