text:
    North Jersey Street Railway Company v. Board of Street and Water Commissioners of the City of Newark et al.
    [Decided August 1st, 1907.]
    1. The,decision of the.board of street and water commissioners, even though made after notice and hearing, not being conclusive on the question as to 'whether certain curved rail connections of street railway tracks on different streets constitute a nuisance ahd are maintained without right, the street railway company may, without waiting for such hearing or attacking the validity of the resolution, apply for an injunction to restrain' the removal of the connections pending the trial of the right- to remove, either in the chancery court or at law:

      2. The Broad Street Railroad Company charter, section 6 (P. L. 1860 p. Jf69; MacL. p. 26), expressly authorized that company to construct a railway through Broad street “and branches from Broad' street to the railroad depots of the N. railroad,” one of whose depots was the Market street station, on condition that the consent of the common council should be first obtained. No consent was expressly given by the council to the Broad Street Railroad Company before its consolidation in 1863 with the Orange company. The Orange company had, however, previously constructed a line on Market street from the depot up Market street to South Orange avenue,- under authority of its charter and an ordinance passed in 1859 giving the city’s consent, and in an amendment of such ordinance, passed in 1861, the Orange company was authorized to construct a track on Broad street, “commencing at Market street and running up Broad to Orange’ street,” &c. By the consolidation of the two companies, the Orange company became vested with the rights and franchises of the Broad Street Railroad Company. P. L. 1868 p. 462 § 2; MacL. p. 18. The Market street track was connected with the Broad street track by curved rails, commencing' at the centre of Market street by the Orange company, but whether the connection was made before or after the consolidation did not appear, but it was made at least as early as 1867, and probably in 1862.' — Sel A, that complainant street railway company, as succeeding to the rights of the Orange company, showed such a right to maintain the curved rail connections as entitled it, pending final determination of its right, to enjoin their removal.
    3. A connection of the tracks of the same street railway' company lying on two different streets is not within an ordinance prohibiting any connection of one railroad with another without consent of the council..
    4. A provision of a street railway charter authorizing the company thereby incorporated to construct a railway through the streets of a city on condition that the company should not lay its rails in or along any street without first obtaining the. permission of the common council is a privilege given to the city, as having authority over the location and construction of the tracks in public streets, which it may waive, or to which an implied assent may be given by acquiescence, and the failure to obtain such consent does not alone render the construction of the track altogether illegal.
    5. P. L. 1861 p. 86; MaeL. p. 59 § 6, chartering the Newark Horse Car Company, authorized it to “connect with and run over any horsé car l'ailroad or -railroads running through Newark to the Market-street station.” By an amendment of its charter (MacL. Comp. p. 11) the .Newark company was authorized to construct its railroad on any street within the city- of Newark on obtaining the consent of the common council, and subsequently (MaeL. Comp. p. J;5S) this consent was given by'an ordinance which provided that the tracks to be built might, be connected at Broad street with the lines of the Orange Railroad company, “as provided by its charter.” The Orange company had'previously constructed a line on Market street from the station up Market street to South Orange avenue, under authority of its charter, and an ordinance - giving the city’s consent, and in an amendment of such ordinance the Orange company had been authorized to construct a track on Broad street, “commencing at Market street and running up Broad to Orange street,” &c., and the M. street track had been connected with the Broad street 'track by curved rail connections commencing at the centre of Market street by the Orange company. — Held, to show a sufficient right in complainant street railway company, as succeeding to the rights of the Newark company, to maintain the curved rail connections.
    6. The charter of the Orange Street Railway Company, section 12 (MacL. p. 11), provided that,, if the company after its road was completed should abandon the same or fail to keep it in repair for one year, the charter should be annulled, and that the city council might remove the road. General Ordinance, section 22, subsequently passed, provided that the common council reserved the power at any time to order the removal of, or to remove, railway tracks and to sell the materials, and, after paying expenses, to pay the balance to the company. — Held, that the ordinance (section 22) referred to a removal of the entire road contemplated by section 12 of the charter, and that the removal of a curved rail connection uniting the line of road on two streets because illegally laid, or for any other reason, could not be required thereunder.
    On application for preliminary injunction. Heard on bill and affidavits, answers and affidavits and affidavits in reply.

      Mr. Frank Bergen, for the complainant.

      Mr. Herbert Boggs and Mr. Francis Child, Jr., for the board .of street and water commissioners.

      Mr. Charles H. Halfpenny, for the town of Bloomfield.

      Mr. Robert M. Boyd, for Montclair.
   Emery, Y. C.

Since 1898, the complainant, the North Jersey company, has maintained, and for at least thirty years previously its predecessors in title maintained, the existing curved rail connections of the street railway tracks on Broad and Market streets, and complainant and all of these companies seem to have maintained and continued them under a claim of right derived from legislative acts or city ordinances, or both. After this long period this right of location of the tracks is now, for the first time, questioned.

The board of street and water commissioners of the city of Newark, which has control of the streets, on February 28th, 190?, adopted a resolution which, after reciting that it was advised that these curved rails and connections were laid without right or authority in law, and are now maintained by complainant without right or authority in law, and that they are a nuisance, dangerous to life and limb, and interfere with the free and uninterrupted use of the streets by vehicles, directed and required complainant, within thirty days to take up and remove these rails and connections, and to restore and repair the pavement in the streets after removal. It was further resolved, that on the complainant’s failure to remove the rails and connections, as directed, the superintendent of the board should remove them and repair the streets at the expense of the complainant. The resolution, which was approved by the mayor and served on complainant on March 1st, seems to have been passed without any notice to the complainant or any hearing.

The power of the board of street and water commissioners over nuisances does not extend to the removal, arbitrarily, or until after trial in a competent court, of a structure of this character maintained in a public street under such a claim of right. Hutton v. City of Camden, 39 N. J. Law (10 Vr.) (Court of Errors and Appeals, 1876). Complainant mignt, by certiorari, apply to have the resolution of the board for the removal of the tracks vacated, as made without notice or hearing (Jersey City, &c., Railway Co. v. Passaic, 68 N. J. Law (39 Vr.) 110 (Supreme Court, 1992), but, as the decision of the board, if made after notice and hearing, would not, under the decision in Hutton v. Camden, supra, be conclusive on this question of right, complainant may, without waiting for such hearing or attacking the validity of the resolution as made without notice, apply to this court to enjoin the removal pending the trial of the right to remove, either in this court or at law. And on presenting a case showing the right to such trial, the removal pending trial should be enjoined, as there can be no question that the removal of the rails will seriously affect the operation of complainant’s system of roads as at present carried on.

Complainant’s right to . maintain the, curved ■ connections is based on title derived from -three different sources.' • •

First. From the Orange and Newark Horse Railroad Company, chartered on March 15th, 1859, and the Broad Street Railroad Company^ chartered March 21st, -1860, which were consolidated by an act of March 24th,-1863. The sixth section of the Broad Street Railroad Company charter (P. L. 1860 p. 467; MacL. Comp. p. 26, &c.) expressly authorized this company to construct a railway through Broad street from the Morris and Essex railroad depot to Clinton township, “and branches from Broad street to the railroad depots of the New Jersey Railroad and Transportation Company.” One of these depots was the Market street station, and this charter therefore authorized the construction of the branch from Broad street through Market street, subject, however, to the further provision of section 6, that the company • . . . -

“shall not lay rails in or along any street in said city of Newark without first obtaining the permission of the common council, upon such conditions and restrictions as the council shall designate and impose.”

No consent or permission to lay the fails for this branch to the Market street station seems to have been expressly given by the common council to the Broad Street company, by ordinance or other formal official action, before the consolidation of the two companies in 1863; but the Orange and Newark Railroad Company had previously constructed a double-track road in Market street from the Market street depot, up Market street to South Orange avenue, under the authority of its charter and an ordinance of March 7th, 1859, giving the consent of the city to- this construction. McFarland v. O. & N. H. R. R. Co., 13 N. J. Eq. (2 Beas.) 17 (March Term, 1860); affirmed, on appeal, 13 N. J. Eq. (2 Beas.) 561 (November Term, 1860). And'on November 1st, 1861, the .common council, by ordinance,, by a supplement to this ordinance of March 7th, 1859, authorized the Orange and Newark Ilofse railroad to construct a track for a horse railroad on Broad street, “commencing 'at Market street and running up Broad to Orange street,”'&c. Whether the Orange and Newark company was, under its own original charter, authorized to construct two routes to Orange, one by way of Market street and another by way of Broad and Orange streets, might, perhaps, have been questioned, but by the consolidation of the two companies, the Orange and Newark company became vested with the rights and franchises of the Broad Street company (P. L. 1868 p. 1/.62 § 2; MacL. p. 18) and, as above stated, the franchises of the Broad street company included the express right to construct a branch from Broad street to the Market street depot, and to lay the track, on obtaining consent of the common council. The Orange and Newark company, before the consolidation, had the consent of the council to lay the track “commencing at Market street and running up Broad street.”

The connection of the Market street track with the Broad street track, running north by the curved rails, was made by the Orange and Newark Railroad company, as is admitted by the answer, but whether made before or after the consolidation does not appear. This connection of the tracks by the curved rails, being one which connected two railroads of the same company, was not within the provisions of the fifteenth section of the general ordinance prohibiting any connection of one railroad with another from being made without the consent of the council. This section, as will appear from its provisions, related to the connection of a railroad owned by one company with a raiL road owned by another company. Considered, therefore, as a connection of the Broad street and Market street railroad tracks of the same company, the question is whether the lawfulness of this connection or its continued location can now be questioned by the city. My present view is that it cannot, and certainly the right to question the legality of the original location at this late date, is so open to doubt that the complainant is entitled to enjoin the removal pending the final trial of the right, and the production of all the evidence obtainable as to the circumstances of the original location. The reasons, shortly stated, are these. The consent of the city required by the charters of the Orange and Newark railroad and Broad Street railroad seems to relate only to the laying or construction of the tracks, not'to the power or franchise of operating a railroad for transportation and tolls, when it had been constructed, which power was given by other sections (section 12, Orange and Newark charter, and section 7, Broad Street charter). And this right to regulate the conditions of laying the tracks in the city was a privilege given to the city mainly for the purpose of controlling the place of location of the track in the streets, the manner of construction and the protection of the public rights during the construction. A failure to procure the consent would have entitled the city to enjoin the construction and perhaps to require the removal of tracks laid without consent, if this relief was promptly applied for. But the city had, I think, the right to treat the consent given previous to consolidation, to the Orange and Newark Railroad company to build a track on Broad street, as a sufficient consent for the construction after consolidation, of the track “commencing at Market street,” under the ordinance of November, 1861, or for its continuance, if previously constructed. These curved rails do, in fact, commence at the center of Market street, and as there was nothing in this ordinance which precisely fixed the place or manner of commencement, or required the rails either to be laid in a straight line across Market.street, or to stop at the north side of Market street, the track “up Broad street,” commencing “at Market street” might, as it seems to me, lawfully commence at or on any point of the common intersection o£ the streets. The precise location of the tracks at the intersection of the streets, - and whether the tracks should there cross at right angles or be connected by curved rails, was altogether a matter to be practically settled by the companies and the city, if it was not fixed by the ordinance itself. That a connection by curved rails somewhere at the intersection of the streets was contemplated, seems certain, as otherwise the provision of the general ordinance, section 6 (MaoL. Comp. p. for a single fare within the city limits, would have been inoperative, no transfers being required by the ordinance.. The continuance of the curved-rail connection from at least as early as 1867, and probably from 1862, is such evidence of the actual location of tire tracks “up Broad street, commencing at Market street,” under the ordinance of 1861, by the railroad company and the city, as would probably entitle the company, on final hearing, to a decree enjoining their removal at tliis late date on the claim that they were originally located without authority.

If this construction of the ordinance and statutes is correct, then the North Jersey Bail way company, as succeeding to the rights of the Orange and Newark Horse Bailroacl Company, is entitled, pending final hearing, of a trial at law, to enjoin the removal.

This is not a question of the effect of acquiescence of the officers of a municipality as barring the right to question the continuance of a public nuisance. The construction and operation of the road in the public streets rests finally on the legislative authority, and both construction and operation are under legislative, not municipal authority. The provision for the municipal consent is a condition fixed by the legislature, and whether the condition is one which renders the construction of the track altogether illegal, if the consent be not obtained, or whether the provision is a privilege given to the city, as having authority over the precise location and the construction of the tracks in the public streets, and which it may waive or fail to enforce, or to which an implied assent may be given by acquiescence, is a matter of construction of the statutes. I am inclined to think that the consent required by tírese charters is a privilege or' right of the latter class, and that the failure to formally give this consent would not render the construction and subsequent operation of the road, under legislative authority alone,- illegal or unlawful. The consents required by the Traction- Company act (P. L. 1898 p. .Si02 ch. ISM § 1) extend to the use and operation of the road as well as its construction and seem to be of the former class. The construction- and operation of the tracks" in question, if made under legislative authority, cannot be a nuisance, and the principle of lack of power in the city officers or' common council to acquiesce in nuisance does not apply. The principle which does apply is the principle relating to an acquiescence in a location of the tracks by both city and company. If the action of the city is merely such consent to, and acquiescence in, location, its rights are or may be affected by the lapse of time, and the rights acquired while acting in reliance on the acquiescence may be protected from disturbance. The ordinance passed March 1st, 1872 (MacL. p. 44-8), requiring the Orange and Newark company to run their cars from the Market street depot on the Orange route, to the terminus of their road, at fixed intervals, is formal evidence to some extent of acquiescence in the location of the curved-rail connection, if the question he, as I now think, one merely of location.

Second. According to my present view, the company shows a case in which it may be entitled to maintain the curved-rail connection by express legislative authority subsequently given in the charter of the Newark, Bloomfield and Montclair Horse Car Company (P. L. 1867 p. 86; MacL. p. 69, &c., § 6) authorizing it to “connect with and run over any horse car railroad or railroads running through Newark to the Market street station.”

The original charters of the Orange and Newark and Broad Street Companies declared their railroads to be public highways, free for the passage of any railroad carriages, on payment of tolls. MacL. p. 11 § 12, Orange and Newark charter and MacL. p. 29 § 7, Broad Street charter. The right of the Newark, Bloomfield and Montclair company to construct any part of its railroad on any street within the limits of the city of Newark, upon obtaining the consent of the common council, was given by an amendment to the charter, March 30th, 1869 (MacL. Comp. p. 71) and in July, 1869 (MacL: Comp. ¶. 468), this consent was given by an ordinance which provided expressly that the tracks to be built might be connected at Broad street with the lines of the Orange and Newark Horse Car Railroad Company, “as provided by its charter.” As the tracks of the Orange and Newark were at that time running to the Market street depot over the curved rails, this ordinance was a municipal consent to a construction of their road, for the purpose of running cars to • the Market street station over the Orange and Newark railroad, as provided by the charter of the Bloomfield and Montclair road.

The complainant has also succeeded to the rights of the Newark, Bloomfield and Montclair railroad, and if authorized to maintain the curved rails for that purpose, cannot be required to remove them, as being 'a nuisance on the ground that they are illegally located or maintained in the street.

The third source of -authority for laying and maintaining the ■curved rails is based on the provision of the Traction act-- of 1893. P. L. p. 302 &c. The first section of this act {Gen. Stat. pp. S23S, 3236) authorizes companies formed under this act to enter upon any street or railway upon which any street railway is constructed (with the consent of the owner or owners, lessee ■or lessees, or of the person or persons operating the same) “and ■* * * maintain and operate such railway.” The Consolidated Traction Company, organized under this act, did enter on .and take the railroad as then operating on the curved rails, and this claim to express legislative right to maintain the tracks, even if originally laid without municipal consent, seems to be sup1 ported by the construction given to the Traction act by the supreme court in Jersey City v. North Jersey Street Railway Co., 74 N. J. Law 45 Vr.) 774. (1907). This decision, however, is now under Teview in the court of errors and appeals, and as, in my judgment, the right to lay and maintain the “curvedxail” connection is supported by the previous acts, I shall not .consider this claim. Neither do I think it necessary to- pass upon the claim of right set up in the briefs, but not specifically set out in the bill, by which the right to maintain the curved rails is claimed under the charter of the Essex Passenger Railway Company, authorizing this company to connect their railway with that of any other passenger railway company, for the purpose of completing a route or making a circuit. While this claim of right should be considered before the final disposition •of the case, the present application fox preliminary injunction ■should, T think, be disposed of on the claims of right set out in the bill as the basis for injunction.

For the power to compel removal of the curved rails, the city .-also relies on the twenty-second section of the general ordinance for regulation of passenger railways, passed in 1859, which ■provides that

•“the common council reserves the power * * * . at. any time to order the removal of and to remove any such railway track or tracks at their discretion, and to sell or dispose of the materials, and after paying expenses of. removal and sale, and repairing the highways, to pay the balance to the company or owners.”

This.power to order removal apparently applies only to the removal of the entire railway from the city streets, not to the removal of portions, of the track because illegally laid, or. for any other reason, and the notice of the board of street and water commissioners did not purport to have been given under this supposed power. Such power of arbitrary removal could not be created either by “reservation” or otherwise, unless the legislature authorized it, and the power would be controlled by the acts of the legislature passed subsequent to the ordinance and therefore controlling its effect. Jersey City v. Jersey City and Bergen Railroad Co., 20 N. J. Eq. (5 C. E. Gr.) 360 (Chancellor Zabriskie, 1869). The charter of the city gave no arbitrary power of removal and destruction of street railways, nor any right to reserve such power of arbitrary removal. The charter of the Orange and Newark company {MacL. p. 11 § 1Z), which was passed before the ordinance, provided that if the company

“after the road is completed shall abandon the same or cease to use and keep it in repair for one successive year, in the city of Newark, that the charter shall be annulled, so far as it affects the city of Newark, and the common council may remove the same, and appropriate enough of the materials thereof to defray the expense of such removal, and for repairing the streets.”

The twenty-second section of the ordinance refers, I think, to a removal of the entire road contemplated by this section of the charter; the removal of this curved-rail connection cannot be required under this twenty-second section of the ordinance.

Whether the operation of complainant’s cars over these curved rails has become a nuisance, and whether this court has power to control the operation at this point, for the purpose of abating the nuisance to public travel, which is alleged to have grown up, are entirely different questions, on which no opinion is intended to be expressed.

The only question I can determine now is, the right to maintain the curved-rail connection on the street at all for any purpose, however limited. As to this, I think the company has shown a case of right, if the case is to be- decided on the facts now appearing, and-1 think there is no doubt that it has shown sncli a case as entitles it to an injunction restraining the removal until tlie final determination of the right.

I will advise the issuance of such injunction, but before signing the order will hear any suggestion as to the form or terms of the order.


source: Caselaw Access Project

author: Emery, V. C.

license: Public Domain

text:
    William Powell, administrator, v. Lillie E. Yearance et al.
    [Decided October 7th, 1907.]
    1. A bill was brought against the beneficiaries of a decedent to impress a trust on the devised property. A final decree was rendered against one defendant charging her share with the entire amount, but the decree did not dismiss the bill against any of the defendants, nor was there any reference therein to the rights of the other defendants. Upon appeal by the one defendant alone, the charge placed upon her share was diminished, the decree reversed and the lower court entered a decree on remittitur. — Held, that the decree on remittitur was final as to the character and extent of the appealing defendant’s liability.
    2. As to the defendants not parties tó the appeal the decree on remittitur was only interlocutory.
    3. A bill was brought against the beneficiaries of a decedent to impress a trust on the devised property, and a final decree was rendered against one defendant charging her shdre with the entire amount, but the decree did not dismiss the bill against any of the defendants, nor was there any reference in the decree to the rights of the other defendants.' — Held, that the decree was not final in favor of the other defendants.
    4. A second appeal will lie by defendants not parties to the first appeal to bring up proceedings subsequent to the mandate on remittitur to correct errors of the court in entering decree on the mandate.
    5. While the general rule is that all parties to the record should be made parties to an appeal, the question is one for the final determination of the appellate court.
    6. On a bill to impress a trust on devised property to the value of a house and lot which cértáin of the devisees promised decedent to' convéy to complainant, a decree of specific performance is not necessary, but a decree charging the respective shares, of the .devisees for payment of the amounts respectively due may b.e made.
    7. Whex-e a tx'ust is impx-essed upon devised property to enforce the performance of a promise to the testator subject to which it was intended to be devised, it is upon' the ground of fraud in. holding the property free from the effect of the promise, from which a trust ex maleficio arises.
    8. Where a promise, on the faith of which an estate is devised to persons severally, is made by one of the devisees, the other beneficiaries do not hold their shares subject to the promise, as otherwise one beneficiary would be enabled thereby to deprive the rest of their benefit by setting up a secret trust.
    9. The statutes of frauds and of wills are operative in equity, and relief from them, where property subject to a trust is retained free from the trust, is upon the principle that statutes to prevent frauds are not to be used as instruments of fraud.
    On final hearing on pleadings and proofs.
    The original bill in this case was filed on November 22d, 1893, by Mrs. Powell against the executors of the will of George D. Randall, and also against his children, Mrs. Yearance, Edith and Frederick L., devisees and legatees of his residuary estate under his will. By an amendment ,to the bill, filed June 15th, 1894, the three infant children of Frederick L. Randall, who had also an interest in' the residuary estate, were made parties. The general object of the bill was to impress a’trust in favor of Mrs. Powell, on the property left by Mr. Randall to his children and grandchildren, by reason of a parol promise-alleged to have been made by two of the three children (Mrs. Yearance and Edith) by reason of which promise' the testator was induced to execute his will without inserting a provision in favor of the complainant, Mrs. Powell-, by which- she should receive (on certain conditions) $4,500 from the estate. Payment of the $4,500' as a charge upon the entire estate is sought.
    The will, after directing -payment of debts, and a specific devise of a-house in- Clinton avenue (or the .proceeds of its sale) to his two daughters, devises the' remainder of' testator’s estate as follows: The income of one-third to his daughter Mrs. Yearance, during her-life, and the income of onerthird'to his son, Frederick, during his life, while the remaining one-third is devised and bequeathed absolutely to his daughter Edith, on reaching twenty-four years of- age, the income to be paid to. her by the executors until that time. On Mrs. Yearance’s death leaving issue, the one-third vested in her for life goes to her children absolutely, and on her death without issue, - one-half of this third is to go to tire daughter Edith, absolutely, at twenty-four, the remainder to the children of Frederick equally, payable to them severally on reaching twenty-four. No express devise or bequest is made of the principal of the one-third of the estate vested in Frederick for life, and as to this the testator seems to have died intestate.
    The defendants Mrs. Yearance and Edith answered, denying the promise to the testator, alleged to have-been made by them, and the executors answered separately, putting complainant to proof of her case. The defendants Frederick L. Randall and his three infant children were served with process, but no appearance or answer was filed by or on behalf of either of them, nor was any decree pro confesso taken against them at the time of the hearing in June, 1896, before Vice-Chancellor Reed, on the amended bill and answer. On this -hearing the executors and the answering defendants alone appeared to defend. Upon the proofs submitted the vice-chancellor found that the alleged promise was.established as against the defendant Mrs.. Yearance, and on December 22d, 1896, a final decree was advised, reciting that complainant was entitled to the relief sought by her bill against Mrs. Yearance, and directing that Mrs. Yearance (within a time fixed) convey to the complainant a house and lot described in the bill or that in default, she pay complainant the whole amount, $4,500, and that until so paid the executors pay to complainant. any moneys Mrs. Yearance was entitled to in the estate towards payment until fully satisfied.- Decision, as to the question of interest on the $4,500 was reserved.
    The learned vice-chancellor in his conclusions stated that there was no proof of any promise, valid or binding, on the daughter Edith, and that no decree could be made against her share of the estate. The final decree, however, did-not dismiss the bill either against her or against any of the other defendants, nor was there in the decree any reference to their rights. Mrs. Yearanee appealed from this final decree, and on the-appeal the complainant as the sole respondent, and Mrs. Yearance as the sole appellant, were the only parties. Mrs. Powell did not appeal from the decree.because of failure to hold the other defendants. On this appeal the court of errors and appeals, after full examination of -the proofs — Yearance v. Powell; 55 -N. J. Eq. (10 Dick.) 577 (1897) — also reached the conclusion that Mrs. Powell was entitled to a decree against Mrs. Yearance, charging her share of the estate, but only to the extent of her share of the $4,500 instead of the whole amount, and in so far as it charged her with more, the decree was said to be wrong.- The court of errors and appeals, however, did not itself direct the form of decree to be drawn, and on June 38th, 1897, a decree was made on appeal, reversing the decree in chancery and remitting the record and proceedings to this court “to the end that a deeree may be made by said court in conformity with the opinion of this court.” In reference to complainant’s right to compel payment of the residue- of the bequest from those entitled to the other shares, the opinion of the court bjr Mr. Justice Collins says (55 N. J. Eq. (10 Dick.) 580), that-as'the devisees of these shares were not before the court, it was precluded from examining and determining the question. The opinion, however,- said upon this point, that the vice-chancellor in his opinion assumed that there could be no claim against the other devisees in the absence of promises by them respectively, but that there were decisions holding otherwise in - cases like the present, and that they proceeded on the theory that one of several devisees of a class represents all, and that where a testator executes his will on the faith of a promise that some trust will be performed, made by one of the class on behalf of all, it is fraud for the others to claim the devise without showing the burden. And it was further declared in the opinion that should the court of chancery adhere to the view of the vice-chancellor, Mrs. ■ Powell might present the question by appeal. The proceedings in this court subsequent to the remittitur were as follows: On February 15th, 1899, Mrs. Frederick L. Eandall was appointed guardian- ad litem for her children, the three infant defendants. Mrs. Powell died in January, 1901, and the suit was revived in the name of her husband as lier administrator. • In June, 1901,-a decree pro confesso-was taken against the defendant Frederick E. Eandall, and on-January 18th, 1904, after notice to all the defendants, the decree on remittitur'¶as settled. This final decree on remittitur, entered on January 18th, 1904, recited that in conformity with and obedience to the decree of the court of errors and appeals, it was decreed that Mrs. Yearance pay to the complainant, as administrator of Mrs. Powell, within twenty days, the sum of $1,500, with interest from March 13th, 1899, and costs, and that, until said amount was fully paid and satisfied, the executors of Mr. Eandall pay to complainant all moneys which Mrs. Yearance might be'entitled in the estate. The decree further recited that the court of errors and appeals was of opinion that there might be an equal liability on the part of the other devisees who were parties defendant to the suit, but that this question was not determined, because said parties defendant were not parties to the appeal, and that a decree pro confesso had been taken against Frederick Eandall, one of the defendants, and then ordered that the cause be set down for hearing and argument upon the pleadings and proofs as already taken and filed in the cause, and on such further proofs as the guardian ad litem of the infant defendants might offer, “to the end that it may be determined if there be any liability to said complainant on the part of the defendants, the children and grandchildren of the testator (other than Mrs. Yearance, naming them), or any of them, and if there be such liability, what and how much and how chargeable, payable and distributable between said defendants, and that such order or decree may be made in the premises as may be conformable to equity and good conscience.” No appeal was taken from this decree as not made in conformity with the opinion of the court of errors and appeals, but such objection is now made by the defendants upon the hearing before me, pursuant to the -final decree. The further objection is made that the first final decree entered in June, 1896, directing Mrs. Yearance to ¡Day the entiré amount claimed, and, failing to direct any payment by any other defendant, is a final decree adjudicating in favor of the other defendants the claim now made. •
    The other defences are raised, viz.: First, that under establislied practice no decree at all can be made on the proofs other than-a decree against Mrs. Yearance for specific performance of a contract to convey the Brunswick street lot,.and second, that the proofs taken fail to establish any legal promise or liability on the part of the defendants, other than Mrs.. Yearance; the proofs being purely oral and therefore of no. effect or validity under the statute of frauds and the statute relating to wills. No proofs have .been taken on this hearing other than those taken on the original hearing before Vice-Chancellor Reed, and considered by him and by the court of errors and appeals. On behalf of Mrs. Yearance it was suggested at the argument that.the decree on remittitur-was inequitable as against her, in that it directed the payment of the entire sum of $1,500 and interest out of. the income payable to her instead of out of the principal invested for her benefit for life.

      Mr. John B. Hardin, for the complainant.

      Mr. Francis Child, for the defendants.
   Emery, V. C.

(after statement),

On the questions argued or stated at the hearing before me, I reach the following conclusions: •

First. As to the defendant Mrs. Yearance, the decree entered on remittitur in this case is, for the purposes of this hearing, a final decree as to the character and extent of her liability, and of the liability or charge upon tire share of, or interest in, the Randall estate to which she is entitled.

Second. As to the ■ defendants other than Mrs. Yearance, the original final decree of -the court of chancery, directing that the whole amount claimed 'by the complainant be charged upon the share of the defendant Yearance in the Randall estate, is not a final adjudication in favor of the defendants other than Mrs. Yearance, whose shares in the estate- were sought to be charged. There was no dismissal of the bill as against these defendants other than Mrs. Yearance, claiming interests, in the- Randall estate, nor was there any decree discharging the executors from any payments other than out .of Mrs. Yearance’s share.. In the absence -of any express adjudication or decree in favor of the other defendants by dismissal of. the bill as to them,, or .otherwise, any discharge of these defendants from further liability .on the bill could only be indirect or by way of inference from the decree, and was subject to any change or modification which might be made on appeal from the decree.

As to the modifications of the decree which were made by the court of errors and appeals, I must take the final decree entered January 18th, 1904, on remittitur, on notice to all parties, as conclusive for the purposes of this hearing. Inasmuch as the defendants other than Mrs. Yearance were not made parties to the appeal and were, not heard in that court as to the reversal of the decree in chancery, or the form of decree to be entered on appeal, the decree of January 18th, 1904, is probably, as to them, only an interlocutory decree made before final.hearing and in the course of this suit, and as such, under our practice declared to be settled in Pennington v. Todd, 47 N. J. Eq. (2 Dick.) 569 (Court of Errors and Appeals, 1890), may be subject, after final decree on this hearing, to review by the court of errors and appeals, in respect to its being a proper construction of its opinion. Even as to parties to the appeal and bound by the decree .on appeal, the rule is that a second appeal will, lie to bring up proceedings subsequent to the mandate on remittitur, and this may involve the.question whether the decree follows the direction of the appellate court. 2 Fost. Fed. Prac. (3d ed.) § 519, citing interai Stewart v. Salamon, 97. U. S. 361 (1878), where.Chief-Justice Waite says on the subject: “An appeal will not be entertained by this court from a decree entered in the circuit or other inferior court, in exact accordance with .our mandate upon a previous appeal. Such a decree when entered is, in effect, .our decree, and the appeal would be taken from ourselves to ourselves. If such- an appeal is taken, however, we will, upon the application of the appellee, examine the decree entered, and, if it conforms to the mandate, dismiss the case, with costs. If it does not, the case will be remanded with appropriate directions for the correction of the .error.” This, review on second appeal .for the purpose .of correcting any error of the subordinate court in entering the decree on .the mandate^ is specially necessary, in cases like the present, where'the remittitur-on appeal did not expressly state the terms of the decree, but directed that it be entered in conformity with the opinion filed. There can be no question, I think, that the defendants not-parties to the appeal, may, by appeal, ■ question the correctness of the decree entered on remit tiiur, if it is claimed to affect them. The general rule is that all parties to the record who may be' affected by the reversal of a decree should be inade parties' to the appeal. Davis v. Mercantile Trust Co., 152 U. S. 590, 593 (1893), and I think that if application had been made,‘the court of errors and appeals might have reqúiréd the defendants, other than Mrs. Yearance, to be máde parties, for the reason that as the decree directed that she should pay the whole amount originally claimed by the complainant from all defendants, and the complainant, who was entitled to but one páymenü, did not appeal from that decree, their interests would or might be 'affected by any reversal or modification which would leave the complainant free’to further pursue them, as she has now done. But the question of necessary parties on- any appeal is one for the final judgment of the court of'errors and appeals, and the only practical effect of a decision in appeal, without all'the parties interested being parties to the appeal, would Seem tó be that on a subsequent appeal by persons not parties to the previous appeal, the questions decided in the appellate court may be open for a second argument. On this branch of the cáse I conclude, 'therefore, that as to the defendants other 'than Mrs. Yearance, the question whether their shares or interest in the Randall estate are charged with.the payment of the sum claimed by complainant (and not charged on the Mrs. Yearance share), is still open for final determination, and that under the decree of January 18th, 1904, the proofs previously taken are to be considered. ' ‘ '

Third. The objection that, upon the proofs, no decree can be made other than a decree for specific performance against Mrs. Yearance, of the Brunswick' street lot, and that this is the only decree to which complainant is entitled on these proofs, must- be overruled, so far' as it is' relied on as a legal' or formal'objection to á decree- other than one of specific performance On such proofs. This is upon the ground that'the'decision on appeal in Powell v. Yearance lias tlie force of a precedent, which settles as a matter of law and practice, that on a bill of this character, supported by these proofs, a decree charging the respective shares of the legatees in the hands of the executors, for payment of the amounts respectively due, can be made. In reference to this objection, it may be further observed that the bill specifically prayed such payment and did not pray specific performance; that the decree for conveyance originally directed by the court of chancery practically made the conveyance an optional method of payment and was so construed by the court of errors and appeals, and that the decree on remittitur (by which I am concluded) directed payment of a proportionate amount, without any option for conveyance, this feature of the original decree being omitted.

Fourth. On the facts of the case appearing by the proofs, I reach the same conclusions as those arrived at by Nice-Chancellor Reed, and by the unanimous opinion of the court of errors and appeals, viz., that the testator desired to alter his will which had been prepared for signing, so as to devise to Mrs. Powell a house which he then supposed he owned as part of his estate, and on being informed that this could not be- done, because Mrs. Yearance owned the house, he then proposed to change his will, so as to give Mrs. Powell the sum of $4,500, which he then fixed as the value of the house; that Mrs. Yearance, with the object of inducing him to sign the will as drawn, and not to delay signing for the purpose of making the change, assured him that this would be all right, and I. find that the will was signed as drawn on the faith of this assurance. This assurance was not made in the presence of any of the other devisees, and their first knowledge or information of it was after testator’s death. This assurance, as I further find, was given not with any object or purpose of taking any future advantage, but, solely for the reason that Mrs. Yearance and all the parties then present believed the physical condition of the testator to be such as to render dangerous any delay in the execution of the will for the purpose of making the change.

Fifth. That a promise or assurance thus made, impressed on the share of the estate coming to Mrs. Yearance, a trust for .the. purpose of carrying out the promise by the payment of her proportionate share, was finally decided on the appeal in this cause, and settled as the law of the state. The question left open and undecided is, whether -as to the other devisees and legatees entitled to shares in the estate the promise of Mrs. Yearance, one of the beneficiaries, and the testator’s reliance on it, by leaving out of his will'a direction for-payment of the $4,500, to which all of the shares would have been subsequent or subject, impresses a trust upon the shares of the estate other than those of Mrs. Yearance. Trust, in cases of this character, are impressed on the ground of fraud, actual or constructive,-and ’the basis or ground upon which fraud is imputed is that of holding the estate of testator against conscience. It is not based necessarily on any imputation of fraud, or intention to defraud, at the time of making the promise, but of afterwards holding or attempting to hold the estate," as if the promise, on which "the estate was received in its original condition, had not been made. The fraud consists in holding, or attempting to hold, the estate free from the effect or obligation of a promise, subject to which it was intended to be devised and received and which it is obligatory in conscience to cany out. Where the estate or interest therein is thus received by the person who made the promise, the attempt to hold the estate without performing the promise is an actual fraud, for the reason that the recipient having actually made the promise, knows personally of the obligation, and is guilty of actual fraud in holding, or attempting to hold, the estate without performing the promise, so far as his interest in the estate extends. As to such promisor, it is clearly not a question of modifying or cutting down plain and ambiguous devises in a will, by parol evidence or unattested papers, in violation of the statute of frauds or of wills, for the devise to the promisor is not modified, but he is dealt with as a holder by fraud of property under the will, and a trust ex maleficio is raised from these facts. Williams v. Vreeland, 32 N. J. Eq. (5 Stew.) 136 (Chancellor Runyon, 1880); In re Will of O'Hara, 95 N. Y. 403 (1884), and cases cited (at pp. 413, 414) ■ And where the promise or assurance, on the faith of which-an estate or interest is devised to two or more persons as joint tenants, is made by one of the joint tenants, the'trust is enforced against all, on the ground that in relation to an estate thus jointly- devised the promise of -one joint tenant binds all equally. In re Will of O’Hara, supra (at p. 413), and eases there cited. As all the joint tenants must hold equal and the same estates, and the estate of all the joint tenants was devised on the promise -of one, and all got their rights through the promise of one, it must follow that the joint estate held equally by all is affected by the promise of one, and the retention of the estate on their part, after information or proof of the fraud of their joint tenant, becomes fraud on their part.

But where the devise or bequest is to several persons, either severally or as tenants in common and not as joint tenants, and some of the tenants have had nothing to do with the making of the will, other and different considerations arise, and a distinction has been made. As to such devisees or legatees receiving estates by will, the case involves the application both of the statute of wills and the statute of frauds, and the decisions seem to be almost uniform that where the interest claimed to be charged is devised or bequeathed in severalty or in common, the beneficiary does not in equity hold' the estate as bound by the obligations or assurances to the testator of another beneficiary or tenant in common. It is considered that to give effect to such assurances would contravene the statute of wills and would entitle one beneficiary to deprive the rest of their benefits by setting up a secret trust. Tee v. Ferris, 2 Kay & J. 357 (Eng. Ch.) (Vice-Chancellor Wood, 1856); Robotham v. Dunnett, L. R. 8 Ch. Div. 430 (Vice-Chancellor Malins, 1878); In re Will of O’Hara, supra.

Trusts based on the actual fraudulent conduct of a person in the procuring of a devise either to himself alone or to himself and others, stand upon a different ground, and the settled rule in such cases is that the interests thus obtained by a third person by means of the fraud of another cannot be retained. Bridgeman v. Green, 2 Ves. 627 (Lord-Chancellor Hardwicke), and Huguenin v. Baseley, 14 Ves. 273 (Lord Eldon, 1807), in which interests or estates in remainder were granted or devised to members of the family of the person guilty of fraud in procuring the estate, are the leading eases on this point.-

In Hooker v. Axford, 33 Mich. 453 (1875), the devise by the testatrix was to two persons, an attorney and a third person named by the attorney, upon a secret trust for the husband of the testatrix. It does not appear by the report whether the estate was held in common or in joint tenancy, but it was satisfactorily proved that the devisees were intended to be trustees, and that the third person had recognized the trust. In this case the one-half of the legal title devised to the third person was held, under the facts proved, to be subject to the trust, in favor of the husband, although this grantee had nothing to do with procuring the devise, but this devisee was apparently a stranger to the testatrix, and the case cannot be considered as authority for imposing a trust upon the shares of a testator’s estate given in severalty to his children, by reason of promises of another child, of which they had no knowledge.

The statutes of frauds and of wills are operative in. equity, and the relief from them, in cases of this general character, is upon the equitable principle, that statutes to prevent frauds are not to be used as instruments of fraud, and where the grant of the estate was not procured by actual fraud on the testator, the only basis of imputing fraud is in the holding of an estate under the will, after proof that the testator gave the estate, intending or supposing that it would be charged with a burden or trust. But the statute of wills covers such cases by expressly defining the character of proofs required.

Treating the question as an open one on this hearing, I should advise therefore that the proof of the trust alleged is not made out against the defendants other than Mrs. Yearance, by competent evidence. But the question as to these defendants seems to be controlled in this court by the' opinion of Vice-Chancellor Eeed on the original hearing. In his opinion he holds the, shares of the other tenants in common, Frederick and Edith, not chargeable with any trust, because there was not, on the part of either, toward the testator, any promise or conduct on which he relied in leaving the will unaltered.

On the point of this necessity of personal fraud and that they were not bound by Mrs. Yearance’s fraud, this decision is a precedent. The suggestion of the court of errors and appeals in reference to their liability entitled the complainant to a further consideration of the question in this court,-and especially as the authorities were 'not specifically referred to in the opinion in either court. On such further consideration, I follow the decision of Vice-Chancellor Reed as a precedent controlling my decision, and based on sound reason and equity, and will advise the dismissal of the bill as to the defendant devisees other than Mrs.. Yearance and the executors.'


author: Stevens, V. C.

text:
    Emma E. Leaver v. John D. Gorman.
    1. Equity will restrain the violation of a covenant entered into by a grantee, restrictive of the use of lands conveyed, not only against the grantee covenantor, but also against all subsequent purchasers with notice of the covenant, whether it run with the land or, not; but, if the original grantor does not bind himself, then his grantee, having no right of action against him, cannot pursue any other grantee to whom the original grantor may subsequently convey the whole or a part of the remaining lands.
    2. Complainant lost her right to enjoin defendant from running a bottling factory in violation of a covenant restricting the use of land by acquiescence where for several years she did not seek to enforce it, but did not lose the right to enjoin an extension of the business.
    .On bill.

      Mr. Charles E. Goolc, for the complainant.

      Messrs. Collins & Corbin, for the defendant.
   Stevens, V. C.

The complainant is the owner of two improved lots of land in Asbury Park, one on the north side of Sewell avenue and the other on the south. The defendant is the equitable owner of two lots on the north side of the same avenue, one a lot twenty-four by one hundred, known as lot “No. 141,” and the other a vacant lot adjoining, fifty by one hundred. On defendant’s first-mentioned lot, for several years prior to 1901, there stood a livery stable. In 1901 the livery business was discontinued and the then owner commenced to make and bottle mineral water, sold principally to summer residents of the resort. The manufacture, conducted on a small scale, changed hands and was finally acquired by defendant, who proposes to erect on his vacant lot a storeroom and other conveniences to be used in connection with this business.

The complainant objects to this contemplated use on the ground that SeweJI avenue is a residence street and that the deeds conveying lots on it contain, inter alia, a covenant against the erection of factories.

As is well known, the park was laid out by Mr. Bradley, its founder, about the year 1872. In nearly all the deeds which he made he caused to be inserted the following, or a very similar covenant:

“The said party oí the second part, for himself, his heirs, executors, administrators and assigns, covenants that he and they shall never use said premises, or cause the same to be used, for the sale of intoxicating liquors or for any manufacturing purposes whatever, and that no hog-pen shall ever be erected thereon.”

This covenant, so far as Mr. Bradley was concerned, was replaced by the similar and somewhat broader covenant contained in the quit-claim deed from Bradley to Sexton, the then owner, made in 1889, but inasmuch as the complainant had acquired from Bradley title to one-half of lot 158 and lot 159 on May 1st, 1876, the benefit of the covenant in the Taylor deed passed to her at that time and was unaffected by the subsequent quit claim of 1889.

This covenant is contained in the deeds both in complainant’s and defendant’s chain of title and the question is whether complainant is in a position to enforce the covenant against the defendant.

The law has been so completely settled in a series of decisions (Brewer v. Marshall, 19 N. J. Eq. (4 C. E. Gr.) 537; Lennig v. Ocean City Association, 41 N. J. Eq. (14 Stew.) 606; De Gray v. Monmouth Beach Club House, 50 N. J. Eq. (5 Dick.) 329; Mulligan v. Jordan, 50, N. J. Eq. (5 Dick.) 363; Hayes v. Waverly and Passaic Railroad Co., 51 N. J. Eq. (6 Dick.) 345; Trout v. Lucas, 54 N. J. Eq. (9 Dick.) 361; Roberts v. Scull, 58 N. J. Eq. (13 Dick.) 396; Ocean City Association v. Headley, 62 N. J. Eq. (17 Dick.) 322) that I have only to apply the principle.

The law is this: A court of equity will restrain the violation ■of a covenant entered into by a grantee, restrictive of the use of lands conveyed, not only against the grantee covenantor, but ¡against all subsequent purchasers having notice of the covenant, whether it run with the land or not. There is, however, this distinction: The original grantor, in imposing the covenant upon the grantee, either may or may not bind himself. If he •does not hind himself, then his grantee, having no right of action against him, cannot pursue any other grantee to whom he may subsequently convey the whole or a part of the remaining lands. In the case of the lands in question, Mr. Bradley chose to remain unbound. In none of the'multitude of deeds offered 'in evidence does it appear that he covenanted to impose the restrictions in question upon the lands remaining in his hands. 'The consequence is that while a subsequent grantee of Mr. Bradley of one lot could enforce the covenant against a prior grantee •of another lot, a prior grantee could not enforce the covenant •against a subsequent grantee. The complainant attempted to take the ease out of the operation of the general rule by proving ■that it came within the exception to it, prevailing where a .■general scheme or plan is shown, according to which every purchaser is to be subject to, and to have the benefit of the covenant as against every other purchaser, prior or subsequent. In this .attempt the complainant failed, for no such scheme, obligatory upon Mr. Bradley, was proved. It appeared, on the contrary, that in the ease of this very street, Mr. Bradley had, in several Instances, exercised the right to convey without imposing upon himself this or a similar covenant.

It so happens that in the case of defendant’s unimproved lot, the Bradley deeds, under -which complainant derives title, were given before the Bradley deed under which defendant derives title; consequently, complainant is not' in a position to enforce the covenant against the owner of this lot.

■ As to the lot already used as a mineral water factory, it so happens that complainant’s is the later title, 'and consequently, she is in a position to. enforce the covenant, unless she and her predecessors have lost the right to do so b3r permitting defendant and his predecessors to build up and carry on the business for the past five years, and she possesses this right, scheme ‘or no scheme; for the covenant required by Mr. Bradley of his grantee of lot 141 was undoubtedly intended for the benefit of the remaining land, of which complainant’s predecessor in title after-wards obtained a part.

I think, however, that complainant has, by her acquiescence, lost her right to an injunction, so far, at least, as to prevent the carrying on of the business as it has been carried on in time past. It is to be remembered that complainant has no legal right whatever. The burden of the covenant does not run with the land. Her right is purely equitable. In this respect it differs from that protected in Gawtry v. Leland, 40 N. J. Eq. (13 Stew.) 323. “Very little, in cases of this character,” said Lord Eldon, in Roper v. Williams, 1 Tur. & Rus. 18, “is sufficient to show acquiescence, and courts of equity will not interfere unless the most active diligence has been exerted throughout the whole proceeding.” On this principle Vice-Chancellor Emery denied relief in Trout v. Lucas, supra. Tichenor v. Wilson, 8 N. J. Eq. (4 Halst.) 197, cited in defendant’s brief, was the case of an interlocutory injunction, to the refusal of which different considerations apply, but Sayers v. Collyer, 28 Ch. Div. 103, seems to be very much in point. It was the case of a beer shop,' against the use of which, as such, plaintiff was protected by covenant, which, however, he had not sought to enforce by legal proceedings until the expiration of three years. It was held that his acquiescence had barred his right to equitable relief. I think the proof of acquiescence in the case in hand is as strong, if not stronger, than the proof in that.

The reason why the complainant here did not proceed is apparent. The business, as conducted, was in no sense a nuisance to the neighborhood. It. may he doubted whether it was not less objectionable than the livery business which had preceded it. No exterior alteration was made in the building. The proof shows that the neighbors were not disturbed. The husband of complainant was himself engaged in carrying on, in this residence street, the business of a plumber, just across the way.

But it seems to me that if the .complainant’s right is to be regarded as lost through acquiescence, this acquiescence can only be deemed to extend to the business as it has -been conducted -in the past — not'to an increased business where more steam or other power may be employed; where more teams may be used, and more noise and vibration result. Bankart v. Houghton, 27 Beav. 425. I have refused an injunction restraining the erection of a storehouse on the adjoining lot for the reason, already stated, that complainant has no standing to object to it. The erection of this storehouse and the equipment of it in the manner proposed will, however, give an opportunity for a considerable enlargement of the output within the building in which the manufacture is conducted. I think, therefore, that the defendant is, under the circumstances, entitled to an injunction to restrain an. extension of the business in this building or on the lot on which it stands. 'Neither side should have costs against the other.


text:
    Lewis Schreiber v. George O. Menningham.
    [Decided July 18th, 1907.]
    In a suit by a purchaser against a vendor to compel the specific performance of a written agreement to convey land, the complainant, to entitle himself to relief, need not show that the purchase-money was tendered prior to the commencement of the suit.
    On demurrer.

      Messrs. Melosh .& Morten, for the demurrant.

      Messrs. Hudspeth & Carey, for the complainant.
   Stevens, V. C.

This is a suit by a purchaser to compel the specific performance of a written agreement to convey land. The question sought to be raised by the demurrer is whether the complainant, to entitle himself to relief, must not show that the money was tendered prior to the commencement of the suit. If it were necessary, I should hold that, ordinarily, where time is not made of the essence of the agreement, an allegation of readiness to perform is sufficient. In Bidwell v. Garrison, 36 Atl. Rep. 941, Vice-Chancellor Reed says: “In equity a tender can be made in the pleadings and need not be necessarily made before the bringing of the suit.” To the same effect are Stevenson v. Maxwell, 2 N. Y. 409; Bruce v. Tilson, 25 N. Y. 194; Freeson v. Bissell, 63 N. Y. 168. Pomeroy, in his note to section 1407, volume 3, of his work on Equity Jurisprudence, after saying that there is a contrariety of opinion on the subject, says, “this (the rule above stated) is unquestionably the true equitable doctrine.” The question is really one of costs.

As, however, the demurrer admits the material allegations of fact stated in the bill, it necessarily admits that complainant, on June 2d, 1906 (the time for performance mentioned in the agreement), tendered performance (that is, complete performance) on his part of said contract for the purchase of said land, and “then and there offered and tendered himself ready and willing to carry out and'perform on his part all of the covenants and agreements to be carried out by him,” &c. The precise objection made is that the agreement provided for the payment of $100 on its execution and of $900 on June 2d, and that while the bill alleges the tender of $900 on June 2d, it makes no specific allegation as to the payment of $100 on May 22d, the date of the agreement. The allegation is that the defendant “made and entered into a contract” with complainant. This shows that the contract was delivered. I think, in view of the above allegations, it may be assumed, either that the money was paid at the time of its delivery, or that complainant offered to pay it,' or such part of it, as remained unpaid on June 2d. The objection is very technical, and does not merit much favor. The defendant cannot possibly be injured, for the court will decree performance by defendant only on terms that complete performance be made by complainant.

The demurrer is overruled, with costs. '


author: Stevens, Y. C.

text:
    Thomas A. Edison v. Edison Polyform and Manufacturing Co.
    [Decided July 22d, 1907.]
    1. Where the original assignment of a preparation compounded by assignor to relieve neuralgic pains gave no authority to use either the name- or picture of assignor, that assignor may have otherwise given a license to use his picture and certificate to his assignees, being persons whom he knew and in whom he reposed confidence, would not entitle subsequent assignees, whom he did not know, to the same privilege.
    2. An injunction will lie to restrain the unauthorized use of one’s name by another as a part of its corporate title, or, in connection with its business or advertisements, his picture and his pretended certificate that a medicinal preparation, which such other is engaged in manufacturing, is compounded according to the formula devised by him, though he is not a business competitor.
    On final hearing on pleadings and proofs. ■

      Mr. Robert II. McCarter and Mr. Franlc L. Dyer (of New York), for the complainant.

      Mr. Charles F. Hill and Mr. Meier (of New York), for the defendant.
   Stevens, Y. C.

The complainant, who is an inventor of electrical instruments and processes, and enjoys in this regard a world-wide reputation, early in his career compounded a medicinal preparation intended to relieve neuralgic pains by external application. It was first made for the personal use of Mr. Edison and his assistants, and not for sale. In the year 1879 a Mr. Lewis and a Mr. Jacobs went to his laboratory in Menlo Park to examine his inventions. While there Mr. Edison happened to mention the fact that he liad been a sufferer from facial neuralgia, and that he had made a preparation -which he had called “Polyform” and which!he had found, to be a good painkiller.. Lewis and Jacobs were so im■pressed with its merits that they-asked him to. sell it. He finally-agreed to sell for $5,000.. . The arrangement was. that he: would apply for a patent and execute an assignment... The patent does not appear to have been issued} but a written assignment of his right to it and to the preparation was made on September 3d, 1879. Qn November 7th, 1879, a company, called the “Menlo Park Manufacturing Company,” in which Mr. Edison had no interest, was organized under the laws of Connecticut, and-it proceeded to manufacture and sell the preparation.. It did so for several years on a small scale, with little or no success, and finally failed. It was succeeded by a corporation, organized on September 3d, 1886, under the laws of Maine, called the.“Edison Polyform Company.” This company, too, met with little success. It was, in turn, succeeded by a New York company, which did nothing. Finally a New Jersey company, the present defendant, was, on May 33d, 1893, formed by certain gentlemen living in Chicago. This corporation is now carrying on the business of making and selling Polyform in that city. The present suit was commenced October 9th, 1903. There has been some delay in prosecuting it, caused, I suppose, by the death of complainant’s solicitor. I do not think, however, that, as the case stands, there is any question of laches. The case must be decided on its merits.

The prayer of the bill is that the defendant company may be restrained from using the name “Edison” as a part of its corporate title or in connection with its business, or in connection with any advertisements circulated or published by it, and from holding out that complainant is the inventor or manufacturer or seller of the preparation sold by defendant.

What the defendant company is doing is to manufacture and sell a liquid preparation containing apparently all but one of the drugs (viz., morphine) mentioned in Mr. Edison’s formula. On each bottle is a label containing, on the one side, directions for use, and, on the other, a picture of Mr. Edison and the following words: “Edison Polyform. I certify that this preparation is compounded according to the formula devised and used by myself. Thos. A Edison.” Mr. Edison testifies that he has never authorized the use of his picture and' that he has never made or authorized this certificate. ■ As to. the present defendant, there is absolutely no pretence that he has. As to the predecessors of the defendant, there is evidence that the picture and certificate were used. But it would seem that when Mr. Edison heard that they were, he objected. He says that he objected to any use whatever of his name or picture. Mr. Grant says, but does not show by competent proof, that he objected only to the representation of machinery around the head. I do not regard the matter as important, because even if Mr. Edison had given a license to use a picture and certificate to the first vendees, persons whom he knew and in whom he may have reposed confidence, it would not, by any means, follow that others, unlicensed, and whom he did not know, would possess the same privilege. In the original assignment of the formula no authority whatever to use either name or picture was conferred.

The regularity of the assignments to the successive corporations was attacked. They appear to be, in some respects, defective, but I do not apprehend that it makes any difference, so far as the present bill is concerned, whether the title of the defendant is or is not perfect. The decision turns upon quite a different point.

• The cases relating to- the law of unfair trade have no. application. They decide, merely, that a trader or manufacturer has no right to put off his goods as the goods of his competitor. The defendant does not put off his goods as being of Mr-.- Edison’s manufacture. It asserts that it is itself the-maker of them. What it does, however, falsely declare, is that it is Mr. Edison who is certifying that the preparation which the company is making and selling is made according tó the Edison formula. It is, ■by its corporate name, by the certificate and by the picture, holding out that Mr.-Edison is 'connected with'the enterprise and supervising its work. .The- question is whether Mr.- Edison is without standing to complain because he is not a business competitor.

Clark v. Freeman, 11 Beav. 112, and Dockrell v. Dougall, 78 L. T. 848, may be thought to favor defendant’s' contention. In the first Case Lord Langdale refused an injunction to prevent a druggist from selling a quack medicine which he called “Sir James Clarke’s Consumption Pills” under the false representation that it was prepared by or under the direction of the eminent physician, Sir James Clark. The decision was that inasmuch as Sir James was not engaged in the business of selling pills, no injury was done to his property of which a court of equity could take cognizance. Dockrell v. Dougall differs from Clark v. Freeman in the circumstance that the druggist who was selling a drink which he called “Jellico,” under the representation that Doctor Dockrell had recommended it, was, in point of fact, telling the truth. The complaint was that he was not authorized to use the doctor’s name in his advertisements; that the doctor had done nothing more than make the statement advertised, in private conversation, without any idea that what he said would be thus utilized. Here, too, an injunction was refused. Whatever view may be taken of the soundness of the conclusion reached by Justice Eidley in Dockrell v. Dougall, it is certain that the decision in Sir James Clark’s case was wrong. In Maxwell v. Hogg, L. R. 2 Ch. 307, Lord Cairns said that it had always appeared to him that it might have been decided in the plaintiff’s favor on the ground that he had a property in his own name, and Lord Selborne in In re Riviere's Trade Mark, 26 Ch. Div. 48, said that it had seldom been cited but to be disapproved.

The leading case on the other side of this question is Routh v. Webster, 10 Beav. 561. There the provisional directors of a joint stock company had, without plaintiff’s authority, published a prospectus stating that he was a trustee. Lord Langdale granted an injunction on the ground that the company was representing the plaintiff as responsible in their speculations in a way calculated to involve him in all sorts 'of liabilities.

In Dixon v. Holden, L. R. 7 Eq. 488, Vice-Chancellor Malins restrained the publication of a notice stating that plaintiff was a partner in a bankrupt firm. Of this case it was said by‘Lord Cairns in the subsequent case of Prudential Insurance Co. v. Knott, L. R. 10 Ch. App. 142, that while he did not agree to the reasoning of the vice-chancellor, he did not mean to say that the decision itself was not capable of being maintained.

Somewhat analogous to the last case is that line of cases which holds that.where a business (including the good will) is sold, the vendee may not use the vendor^ name in such manner as to expose, the vendor.to liability. Thynne v. Shove, 45 Ch. Div. 577; Burchell v. Wilde, 1 Ch. 552 (1900).

The latest English case that I have been able to find on the very question here presented is Walter v. Ashton, 2 Ch. 282 (1902).

There a dealer advertised a cycle which he called “The Times Cycle.” Among other things in his advertisement .were statements to the effect that the “Times” cycle was the only cycle that could be obtained on the “Times” (meaning the “London Times” newspaper), system of payments. There was a manifest attempt to suggest in other ways, without expressly affirming that the “London Times” was connected with the venture. An injunction was granted on the authority of Rouih v. Webster, supra, on the ground that it appeared that there was a reasonable probability that that newspaper might be exposed to liability, that it might possibly be held, responsible if it should not take steps to disconnect its name from the advertisements after they had been brought to its attention. The distinction made was between a liability that was merely shadowy and one that.carried with it a reasonable probability of litigation or pecuniary loss.

Passing such cases as Prince Albert v. Strange, 1 Macn. & G. 25; 2 De G. & S. 652; Pollard v. Photographic Company, 40 Ch. Div. 345; Dentacura Company v. New Jersey State Dental Co., 57 N. J. Eq. (12 Dick.) 593; 58 N. J. Eq. (13 Dick.) 582, which were decided upon the ground of implied contract or breach of cpnfidence, grounds wanting in the present case> I come to the American cases on the'subject. They are comparatively few in number. Two of them, Schuyler v. Curtis, 147 N. Y. 434, and Atkinson v. Doherty, 121 Mich. 372, are plainly, inapplicable. Aside from the dicta in the latter, the point really decided in both was, that a man’s reputation does not, on his death, descend or pass like an asset in such manner that the widow or a relative can sue to- protect it from defamation.

In Roberson v. Rochester Folding Box Co., 171 N. Y. 538, however, the suit was brought on behalf of a living person, a young lady under age, to restrain a flour company from putting her likeness upon prints advertising its flour. The allegation admitted by the demurrer was that the company was printing, selling and circulating twenty-five thousand of these likenesses, with the result of humiliating her and of causing mental distress and physical sickness. A bare majority of the court of appeals overruled the decision of the appellate division and held that no cause of action was set forth in the complaint. This ease resembles the case in hand in that the defendant is here seeking to make an unauthorized use of Mr. Edison’s likeness. It differs from it in the fact that no attempt was made to induce the public to believe that the person depicted was recommending the flour. This case cannot-be sustained on principle, and has been disapproved by the supreme court of Georgia in Pavesich v. New England Life Insurance Co., 122 Ga. 190, and by our own court of errors and appeals in Vanderbilt v. Mitchell, not yet reported. If a man’s name be his own property, as no less an authority than the United States supreme court says, it is (Brown Chemical Co. v. Meyer, 139 U. S. 542) difficult to understand' why the peculiar cast of one’s features is not also one’s property, and why its pecuniary value, if it has one, does not belong to its owner rather than to the'person seeking to make an unauthorized use of it. If the mere exhibition of one’s face to one’s friends and to others on the public streets be a publication for all purposes, then that line of" cases, of which Pollard v. Photographic Company is an example, was wrongly decided, for there could be no implied contract or confidence to keep that private which was already public property.

That the subject is attended with difficulty and that the line between what the court will restrain and what it will not restrain is hard to draw with absolute precision is undoubted. This is well illustrated by the case of libel. If you call a business man a thief, or a physician a quack, in a printed publication, you, undoubtedly, do that which tends, and very directly tends, to diminish his earnings, and yet all the authorities, up to this time at least, agree that because libel is h crime and is actionable at law, equity will hot interfere. Prudential Assurance Co. v. Knott, L. R. 10 Ch. 142, is an illustration. There, the defendant had published a pamphlet, in which he charged the plaintiff company with reckless management, and with being in a state of insolvency. On bill filed alleging the representation to be untrue, and further alleging that the company was, in fact, prosperous and solvent, and that the continued publication of the pamphlet would damage the company’s business and diminish its profits, an injunction was refused by the vice-chancellor and by the lords-justices, on appeal. The decision was put upon the ground that the pamphlet, if its statements were untrue, was libelous and actionable at law, and yet Lord Cairns said, in giving judgment, that there were publications which a court of equity would restrain, and that such publications would be restrained none the less because they happened also to be libelous. He expressly dissented, however, from Vice-Chancellor Malins’ view, that reputation was property, and that it might, on that ground, be protected by injunction. It would seem that the right of the citizen to have his publication passed on by a jury is, to some extent at least, responsible for the rule. Liberty of speech and of the press are guaranteed by the constitution, and the question of their abuse is committed to that body.

There must be limits to- the so-called right of privacy. It is certain that a man in public life may not claim the same immunity from publicity that a private citizen may. Corliss v. Walker Co., 64 Fed. Rep. 280, and as far as my researches have extended, I do not find that it has yet been decided that injury to property in some form is not an essential element to relief. It majq at times, have been a matter of doubt whether what was called “property” was really such, and whether the injury thereto, actual or apprehended, was not so “shadowy” as to be incapable of judicial cognizance, but still the criterion was always injury to property or to property rights. It is to be noted, however, that the insignificance of the right, from a pecuniary standpoint, does not always bar relief. Thus, the report of an association of dentists (New Jersey State Dental Society v. Dentacura Co., 57 N. J. Eg. (12 Dick.) 594), the exhibition of one’s photograph (Pollard v. Photographic Company, 40 Ch. Div. 345), the publication of a private letter, which, as a literary production may be worthless (Folsom v. Marsh, 2 Story 100; Booysey v. Jeffreys, 6 Exch. 583), are accorded the same protection as the lectures of a professor (Abernethy v. Hutchinson, 3 L. J. Ch. 209), the catalogue of a prince’s etchings (Prince Albert v. Strange, 1 Macn. & G. 25), and the currency of a foreign state (Emperor of Austria v. Day, 3 De G. F. & J. 217).

I think that, under the above authorities, the complainant in the present case is clearly entitled to an injunction to restrain the unauthorized use of his name, his picture and his certificate. The possibility of injury, because of their use without apparent objection on Mr. Edison’s part, is quite as great as it would 'have been in the “Times)’ Case had Mr. Walter stood by and allowed the advertisement of the bicycle with what seemed to be a “Times” endorsement. I regard the case of Vanderbilt v. Mitchell, just decided by the court of appeals, as conclusive. That court, as I have said, condemned Roberson v. Rochester Folding Box Co. and cited, with approval, Routh v. Webster and Walter v. Ashton.

It appeared in Vanderbilt v. Mitchell that complainant’s wife, having had born to her, two years after her marriage, a son, who was not complainant’s son, falsely stated to the. attending physician that the complainant was the father of the child. This statement was credited by the physician, who inserted it in his birth certificate, sent by him to the bureau of vital statistics, where it was recorded. The record, by the terms of our statute, is prima facie evidence of the facts therein stated. The complainant prayed that this fraudulent record might be canceled, and that an injunction might issue restraining both mother and child from claiming thereunder the status, name or property of a child lawfully begotten by complainant. The defence set up was that complainant did not show that any of his property rights had been affected, and such was the decision of Vice-Chancellor Garrison, but on appeal it was held that the complainant was entitled to relief. It was pointed out by Judge Dill that, inasmuch as the statute made the recorded certificate prima facie evidence of the facts stated in it, it could be used as evidence in a suit brought against the complainant fox necessaries furnished to the child. This of itself brought, the case well within the ruling in Routh v. Webster, supra. It was a false statement which' exposed the complainant to the risk of pecuniary liability. But the court went further. It appeared that the complainant was a beneficiary of - a vested remainder in land, under a trust which was being executed according to the laws of New York. Hnder the laws of that state, a man cannot devise more than half of his estate to charity where he leaves (inter alia) a child. His right to make an absolute devise of his property was thus threatened, and the impairment of this right was held to give him a standing in a court of equity to attack the certificate. Judge Dill, in concluding his illuminating opinion, said that the question whether the bill 'might hot have been rested on the ground of an interference with personal as contradistinguished from property rights was not decided, for the reason that the case “presented the property feature to an extent sufficient to satisfy even the rule adopted by the court below.”

The court of appeals has thus emphatically declared that the term “property right” is not to 'be taken in any narrow sense, that the tendency of equity, in eases of this description, should be to extend rather than to restrict the jurisdiction. Judge Dill says: “From time immemorial it has been the rule not to grant equitable relief where a party praying for it had an adequate remedy at law; but modern ideas of what are adequate remedies are changing and expanding, and it'is gradually coming to -be understood that a system of law which will not prevent the doing of a wrong,' but only ailords redress after the wrong is committed, is not a complete system, and is inadequate to the present needs of society.”

'It is difficult to imagine a case in which preventive relief-would be more appropriate than the present. In a perfectly unauthorized way, a certificate falsely purporting to be made by Mr.'Edison, and also false in fact because the preparation is not compounded with all the ingredients of the formula, is put, by 'a company bearing Edison’s name, upon every bottle of Poly-form'which it sells. That there-may be no mistake as to who is intended, the certificate is accompanied with a likeness.

I think an injunction should be granted restraining the defendant company from holding out, either in the name of the company, or by certificate, or by pictorial representation, that Mr. Edison has any connection with, or part in,-the complainant’s business. I cannot divorce the company’s name from the other parts of the representation. It is, as the evidence stands, part of the fraudulent contrivance. The abstract question whether a company can innocently use, as a part of its title, the name of a distinguished living character, is not before me for decision, and no opinion is expressed about it.


text:
    Timothy Herrick v. Alexander Dempster et al.
    [Decided July 28th, 1907.]
    Upon the question raised by the demurrer, whether the facts exhibited in the bill justify the complainant in instituting this suit without first making demand upon the directors to do so, the record of the proceedings on that subject in the case of Siegman v. Maloney, 35 E. J. Eq. (20 Dick.) 372, and also the case of Appleton v. American Malting Co., 35 N. J. Eq. (20 Dick.) 375, examined, commented on and the ruling in the former case followed.
    On demurrer.

      Mr. Edward M. Golie, for the demurrant.

      Mr. Robert H. McCarter, for the complainant.
   Stevens, V. C.

This is a demurrer to a bill filed by a stockholder against certain of the directors of the Mine La Motte Lead and Smelting Company, and against that company praying that those directors llray be decreed to pay to the company the whole or any excess of the dividends declared on October 1st, 1903, and on January 6th, 1904, over the actual surplus or net profits of the company.

The question is whether this case comes within the ruling of the court of errors and appeals in Siegman v. Maloney, 65 N. J. Eq. (20 Dick.) 372, in which it was held that no sufficient reason was shown for taking the conduct of the case out of the hands of the company itself; or within the ruling of the same court in Appleton v. American Malting Co., 65 N. J. Eq. (20 Dick.) 375, in which it was held that sufficient reason was shown.

The company has eleven directors. Of these only five voted for the illegal dividends. They, of course, would be hostile, but they are a minority. To show that, presumptively, a majority of the board would refuse to sue, or to sue effectively, it is alleged that two of the new directors were elected “at the behest of and as the tool and instrument of the said Dempster (one of five who voted for illegal dividends) and to carry out his wishes in regard to the management of said corporation,” and that another was elected at the behest and as the tool of Yost (another of the five). Under the rule laid down in Siegman v. Maloney, supra, where it was held that neither the existence of blood nor of business relationship would justify a presumption of dishonesty, I doubt whether this allegation is sufficient. The allegation is not that the three new directors toere tools of either Yost or Dempster, but that they were elected as tools. The allegation relates to the mental attitude of the electors and not of the elected. Experience every day demonstrates that men elected to office do not always do what those who have been influential in electing them expect. The bias of Shinn and Donaldson is attempted to be shown by an inference, and by an inference that is not always the true one.

The other pertinent allegation relates to the director, Hall. The bias in his case is said to have arisen out of the fact that he voted for an unlawful dividend, declared in October, 1904; a dividend — so the bill states — not recoverable from him, “because of a change in the statute law of this state by virtue of an act oE the legislature * * * approved March 38th, 1904.” This act (P. L. l&Olj. p. 2-1S) provides that only in ease of “any willful or negligent violation” of its provisions shall directors, under whose administration the dividend may have been declared, be liable. It must be assumed from the statements of the bill that Hall’s act was neither willful nor negligent. This being so, no moral taint and no legal penalty attached to his conduct. -How, then, in the absence of all proof to the contrary, is it to be presumed that he would not perform the duty which he owed the ■company and its stockholders.

On .the face of the bill itself I do not find a sufficient excuse for not first calling upon the company to sue.

But a somewhat singular point has been raised, growing-out •of the demurrer itself. A single demurrer, joined in by all the ■directors sued and by the company itself, has been filed. Two ■specific causes of demurrer are assigned. One is that the complainant has failed to show any necessity for prosecuting this .action in his own name. As to this, I may say that if the bill failed to show a cause of action in the complainant I should find it difficult to give a reason why the company itself might not take the objection by demurrer. The very fact that it did take the objection, would, in a sense, be an affirmation on its part that it regarded itself, and not the complainant, as the proper dominus litis. But in this case the company has gone further. It has joined in another cause of demurrer, to wit, that the complainant has not, by his bill, stated such a case as to entitle him' to any relief of any sort as to the matters therein contained. The court of errors and appeals, in Siegman v. Electric Vehicle Co., 65 Atl. Rep. 910, held that acts similar to those here complained of are illegal and incapable of ratification by the board •of directors, or even by- a majority of the stockholders. By its demurrer, then, the company has taken up the indefensible position that the directors are not liable. It will hardly do to say ■that this is only matter of pleading. Pleadings are required for the very purpose of compelling parties to put in authentic form what they propose to insist upon. Here, one of the company’s insistments is that the complainant has no cause of action. Its .agent states, in the affidavit attached to the demurrer, that it is not interposed for the purpose of delay, but in good faith. Such being the conipanj^s position, disclosed by the record under consideration, is it not a fair inference that-a request to sue would not have been acceded to ?

The case is somewhat anomalous;, for relief is given, not to the complainant, who prays it, but to the defendant, who may resist it. ■ The position of the parties to the record suggests some interesting questions. Suppose the pleader should state, in his bill, a clear cause of action and should also state a proper demand or a sufficient reason for not making one. The defendant company might conceivably adopt one of three courses. It might file a cross-bill, praying the same relief against the culpable directors that the complainant prays; or it might remain entirely passive and let a decree pro confesso go against it; or it might deny the material allegations of the bill and assert, e. g., that it had declared its dividends out of surplus and not out of capital. Now, suppose that proofs having been taken and the case having come on for final hearing, it clearly appeared that there was a good cause of action; and suppose that it as clearly appeared that complainant had not-made a proper demand before commencing suit, or had not, as matters appeared when the bill was filed, shown a proper excuse for his failure to make it; in other words, had failed to prove the allegations of his bill in that regard. Would a court of equity dismiss the bill and give no relief? Would it not rather give the appropriate relief on the cross-bill or, in the alternative cases supposed, would it not find that the position of passivity or hostility actually assumed and maintained in the face of clear proof, cast a reflex light upon the directors’ intentions and was in itself evidence that a demand to sue effectively would have been rejected?

So, if on the face of the demurrer, it appears that the company is uniting with the directors in denying that it has any cause of action against some of their number, when on the face of the bill it is apparent that it has, is it to be inferred that the attitude assumed when the demurrer was filed was that which would have been taken before it was filed ?

In the English practice the question could not arise.- The stockholder makes the. company a co-complainant. Duckett v. Gover, 6 Ch. Div. 82; Wilson v. American Palace Car Co., 64. N. J. Eq. (19 Dick.) 534. Under our practice the company is quite anomalously made a defendant. Hence the difficulty. In the absence of any decision on-the' subject, I should have found it difficult to come to a very satisfactory conclusion either way. On the one hand, it may be said that in denying to the company the right to demur on a ground plainly apparent on the face of the bill, a ground that the other defendants may take, we are refining too much. On the other hand, it is urged that if the company, at the time it filed its demurrer, took the ground that there was no cause of action on the facts stated, it is a fair inference that it would have taken the same ground before the bill was filed, it being under no necessity, to demur for any such reason.

I regard the point, however, as not open to argument, for it appears to have been necessarily involved in the decision in Siegman v. Maloney, supra, and to have been then decided against the contention of complainant in this suit, both here and on appeal. I have examined the record of that case, and I find that a demurrer of precisely the same kind was interposed by the company, the only difference being that there the other defendants filed separate demurrers, while here the company and the. defendants sued have joined in the same demurrer — a difference that seems to be quite immaterial. As the court of errors and appeals sustained the decree of this court, overruling all the demurrers filed in that case, the practice appears to have been settled.

.The demurrer is overruled.