author: Delaney, C. P. J.

text:
    Passaic County Court of Common Pleas.
    MAX BALASH, PETITIONER-APPELLEE, v. GERA MILLS, RESPONDENT-APPELLANT.
    Decided January 4, 1945.
    For the petitioner-appellee, N-aihm Mabmemiz and Iewdore liabinotoitz.

      For the respondent-appellant, Edwin Joseph O’Brien.

   Delaney, C. P. J.

Max Balash sought compensation for temporary and permanent disability alleged to have resulted from an accident occurring on August 31st, 1943, out of and in the course of his employment by Gera Mills, a manufacturer of woolen textiles. He prevailed in the Workmen’s Compensation Bureau, and from the judgment entered on the determination of facts and rule for judgment his employer appealed.

Balash was one of eight men, including a foreman, employed at the time in question by the woolen manufacturer as “final examiners.” They made the last inspection of the finished cloth, which thereafter passed into the “merchandise department.” Equipped with “spickers” needles and scissors, they explored the fabrics, both front and back, for every sort of flaw and imperfection resulting from the processes of spinning or of weaving, for marks, and also for the proper width and feel. If the goods were found to be too hard or of improper width, they returned them to steaming machines for correction; but otherwise they set down on the several lines of a tag aifixed to the piece, a report of their findings, folded the cloth, raised it upon their right shoulders, and carried it to a truck which, when filled, was drawn or pushed to an elevator and then moved to another floor. When examining the cloth, each workman apparently stood by his own table, on the fiat surface of. which the piece was pulled down from a roll on a movable stand and minutely inspected.

The cloth examined varied from time to time in weight, sometimes being heavier, and again lighter, than the average. The material under examination on August 31st, 1943, was “Government” or “Khaki” serge, running fifty-five, sixty, and sixty-five yards in length—the average piece being sixty yards—and nearly, if not quite, two yards in width, weighing fourteen ounces to the yard, the weight of a piece of average length being somewhat over fifty pounds.

The examiners worked in a large room, described as being over thirty yards in length, in which stood' the steaming machines and “a very big pressing machine,” and in which the temperature, usually warmer than out-of-doors, sometimes rose to a hundred degrees and over. Their hours of work ran from eight o’clock in the morning until half past four in the afternoon, with a thirty-minute intermission for lunch at noon. Their work, it is apparent, was specialized, and. the workers were experienced. Balash had. been employed in it for Gera Mills for seven years, and for an earlier employer twenty years. The foreman, Zalenfce, had held his job for thirty years, and another examiner, Euttger, twelve years. Their tables were plaeed where the northern light fell upon them. It seeras to have been exacting work in which they were engaged, calling for close application. They examined fifty or fifty-five pieces a day, about half of them in the-forenoon.

At noon on the day in question, when a bell announced the recess period, each examiner, in accordance with Ms daily custom, ceased his work, left the cloth lying upon his table without regard to how far his inspection of it had advanced, and. ate his lunch at his own table. When at half past twelve the bell again rang, all of them, except Euttger, who appears to have left his table, at once commenced to work—-the promptitude with which they resumed their tasks turning, we gather from, the testimony of the foreman, on the volume or urgency of the work.

Not long afterward—-the foreman estimates about five, ten, or fifteen minutes, and Euttger “a few minutes,” after half past twelve; “I w-ould say near twenty-five to one”—when all the examiners, save Euttger, were again busied in their work, Balash eoncedediy suffered a coronary thrombosis, from which admittedly came the disability, temporary and permanent, for which he made claim.

He testified that when the bell sounded at noon he had finished the actual examination of a piece, “but I didn’t mark on the baek and the result on the ticket. I stopped because - the hell was ringing for lunch.” He testified further th-a-t he left the cloth lying folded upon his table, and that right after half past twelve he made the markings on the ticket, raised and shouldered the piece, and thereupon felt extreme pain in the upper left shoulder area in his back and in Ms chest, began to sweat and feel faint and dizzy, and being unable to throw the cloth upon the truck, managed at length to push it onto the truck from his table.

He called the attention of the foreman to his state, or the ■foreman perceived the man’s pallor and perspiration, and summoning Buttger, who then had got back to his table, directed him to take Balash to a nurse in another building.

At the hearing in the Workmen’s Compensation Bureau and, of course, here on appeal, counsel for the parties have restricted the subject of controversy to a single question: Was the coronary occlusion the result solely of the natural progress of disease, or did exertion either eanse or precipitate it ? It was granted, for the purposes of this proceeding, that physical effort—and the very exertion which Balash underwent in raising fifty pounds of cloth to Ms shoulder, if, in fact, he lifted it there—may cause, or accelerate and so contribute to, a coronary thrombosis in a man who, like Balash, was then in Ms sixty-fourth year, and suffering from a preexisting coronary sclerosis. It is undisputed that the thromiboeis occurred “in the course of Ms employment;” but Ms employer’s position is that Balash was stricken during the lunch period and did not afterward resume work, and sustained no “accident” and suffered nothing arising “out of” Ms employment.

If is properly conceded in the brief f-or the employer that disability resulting from coronary occlusion occasioned by ; exertion, strain, or trauma, is compensable in this state, in-those instances in which the exertion, strain, or trauma arose out of and in the eourse of the claimant’s employment.

It is fee established law also that an accidental strain upon the heart, even though it was previously weakened by disease, may be a compensable injury, under our statute, where the accident arose out of and in the course of the employment. Hertz v. Janssen Dairy Corp., 122 N. J. L. 494, 508; 6 Atl. Rep. (2d) 409.

The benefits of our aet (N. J. S. A. 34:15—1, et seq.) are not limited to those who suffer no previous physical impairment. Molner v. American Smelting and Refining Co. (Court of Errors and Appeals), 128 N. J. L. 11; 24 Atl. Rep. (2d) 392; Bernstein, Furniture Co. v. Kelly 114 N. J. L. 500; 177 Atl. Rep. 554.

The central question in the matter is one of faet. The burden of proof is, of course, upon the claimant. Armstrong v. Union County Trust Co., 14 N. J. Mis. R. 648; 186 Atl. Rep. 522; affirmed by the Court of Errors and Appeals, 117 N. J. L. 423; 189 Atl. Rep. 138.

The presumption is that a coronary thrombosis “was due solely to disease; and the onus is on claimant to establish that the asserted accident was at least a contributory cause without which the occlusion would not have occurred.” Schlegel v. II. Baron & Co., 130 N. J. L. 611; 34 Atl. Rep. (2d) 132.

The court must be satisfied “that but for the employment” the injury “would not have occurred when it did.” Ciocea v. National Sugar Refining Company of New Jersey, 124 N. J. L. 329; 12 Atl. Rep. (2d) 130.

No one testified that he actually saw Balash hoist the piece to Ms shoulder. Across each table was hung a black curtain, “on account you shouldn’t see anything else only the goods.” Whether the curtains were of such dimensions or were so placed as to amount to screens shutting off one examiner’s view of another, is not determinable from the record. In any case, the foreman, when asked whether any other man in the group knew at the time that Balash had become ill, said that he did not think so.

The eight tables stood, as we understand it, in a single row, each table being about two feet apart from the next; but the work of the examiners was engrossing, and it appea®s that they had earnestly addressed themselves to it. After the lunch period they “started,” in the words of their foreman, “working, pulling these pieces like anything.” The raising of a piece of goods from the table to the shoulder and the placing of it upon one of the trucks entailed routine movement, to which all the men were accustomed, and were movements which each of than made day in and day out, as many times a day as the number of pieces he examined, and each man, without assistance from any other, bore Ms own goods to the teuok, except, perhaps, when the cloth weighed ia excess of a hundred pounds to the piece. The fact is that there is nothing in the evidence that indicated any of the five examiners noticed that the foreman and Balash were talking together, or that Balash and Buttger, at the direction of the foreman, left the room in which they were working.

Zalenke, the foreman—watchful and cautious—was wont to send his men to the plant hospital on slight occasion, “even if anybody scratch his finger, I say take him right away to the nurse.” The testimony of this witness required dose reading, his sentences often being strange in structure, and one sentence sometimes running into another. But that he was intent only on telling the very truth we have no doubt. Only he and Buttger were sworn for the petitioner, who, of course, testified for himself.

Statements in the handwriting of a representative of an insurance company, taken and witnessed by him on October 8th, 1942, and signed by the five remaining examiners, were offered by the respondent and were admitted, without objection by counsel for the claimant, in evidence. These statements consist merely of a few lines, in substantially the same words, and all run to the like effect, namely, that Balash never spoke to them of any accident occurring to himself or complained to them of being unwell. Neither Balash nor anyone on his behalf claimed differently.

Although, as is now known, Balash had pre-existing coronary sclerosis, he had no disabling sickness before August 31st, 1944, but had worked for years theretofore, day after day. He was a steady, a good, and a rapid, worker, according to the pronouncement of the foreman, and there is no evidence to the contrary.

On one occasion, about two weeks before the day in question, as Balash himself placed it, or “sometime in the latter part of August,” as the foreman said, Balash complained at half past three or four o’clock in the afternoon of an upset stomach and headache. The foreman advised him to rest, and he did until four-thirty—the quitting hour—and the foreman said, “The following day he came in to work and he worked as though he had never even felt ill the previous, day.”

No one appears to have seen Balash, we repeat, l-i#t the goods to his shoulder, and yet his testimony that he did is not without corroboration. Zalenke said, in effect, and with characteristic oddity of phrase, that cloth commonly lay upon the examining tables throughout the half-hour luneh period; and it is hard to see how it could he otherwise. The pieces of goods of the same material and construction, as we have seen, were not of uniform length, but varied sometimes by five yards and again by ten, and we suppose it would be a feat for an examiner so to time his work, even if there should be any advantage or point in achieving it, that the completion of his inspection of a piece, including his marking of its ticket, and the striking of the bell at twelve o’clock, should occur simultaneously, or practically simultaneously.

That such occurrence of the two incidents occasionally happened may be assumed; that they happened with comparative infrequency may, we think also, and with equal safety, be assumed.

The foreman testified that after he became aware that Balash was visibly sick, or after he had sent him, with Buttger, to the nurse, he noticed Balash’s cloth upon the track; and he said that Balash must have put it there, each examiner, according to the system in the department, removing his own goods. After lunch “he had a piece to finish; he finished it, because I saw it on the truck, so he must have lifted it on the truck.” In answer to a direct question, “Did you see a piece on Mr. Balash’s table?” he replied, “I think there was a piece on the table.”

Eespondent’s theory is that Balash was stricken in the course of the lunch period. Its theory is supported by no direct testimony or statement, except a statement written out by the insurance company’s investigator and signed by the foreman on October 8th, 1942, on the same occasion as the statements hereinbefore mentioned were obtained from the other examiners. So far as pertinent to the respondent’s theory, it ran: “The next time my attention was attracted to Max Balash was on Monday, August 81st, 1942, during our regular lunch period, between twelve noon and twelve-thirty P. M., while all the examiners and I were sitting eating our laneh at the examining tables in our department, when Balash told me he had just that moment felt pain in his chest and1 hack and that he felt cold. Balash said he had first felt the < pain in his chest while he was eating with us. He did not1 say anything about his work. He did not tell me about any fall or anything unusual. At about twelve-thirty p. m:., August 31>st, 1942 (immediately after Balash told me he felt a pain in his chest) I sent Balash to the mill hospital1 with Fred Bodgers, one of the other examiners.” By “Fred ■ Bodgers,” Fred Buttger was meant.

This statement was probably epitomized by the person in whose lay hand it was set down; it contains words not likely to have been used by Zalenke, but the latter subscribed it and it requires our attention.

At a hearing in the Workmen’s Compensation Bureau, Zalenke said that it was five, ten, or fifteen minutes after half past twelve when he first learned that Balash had become ill; and when, on cross-examination, the above-quoted statement was read to him, he emphatically corrects it—it was not during lunch hour when Balash told him that he was in pain. “Ho, because when we are eating our lunch I am very far away from him, I am just four tables away from him, so after the lunch, after dinner, about that time;” and on this point he stood steadfast and unshaken.

That each examiner ate lunch at his own working table was unquestioned. That during lunch time Balash arose, left Ms table, and walked to or approached that of the foreman, was elaimed'by no one. If during that half hour Balash had complained of distress to Zalenke, “four tables away,” it is curious that the other examiners should have said five weeks later that Balash had never spoken of being unwell. It is true that each of them said that Balash had never told ■ “me” that he w-as ill; but if Balash had complained in their' hearing at all, there is no probability that not one, but five' or six of them shoidd have quibbled about it merely because ¡ he was not personally addressed. T-he examination and cross-; examination of the foreman occurred on December 29th, 1943. \ The hearing was continued on that day to January 12th, ¡ 1944. ' '

On January 12th respondent called four witnesses, and if there was evidence (other than Zale-nke’s statement of October 8th, 1944) that the claimant had complained to anyone between noon and twelve-thirty on the day in question, there was opportunity to have produced it. What respondent then actually produced, apart from the testimony of physicians and nurses, was the signed statements, heretofore mentioned, of examiners who, in the words of respondent’s counsel, “worked on both sides of the petitioner,” all of whom said they had heard no complaint. We cannot escape the conclusion that Zalenke was inattentive to what he signed in October, 1942, or that he and his interviewer misunderstood one another.

One of the two nurses in respondent’s employ testified that Balash’s “case card” stated “12:35” as the time when Balash entered the mill hospital. Perhaps it was never intended to state anything closer than the conjectural or approximate time. If, according to all the evidence on the point, Euttger, holding Balash by the arm, started away some appreciable time after half past twelve—at 12:35, or a few moments earlier or five or ten minutes later—the card is clearly inaccurate. They worked on the third floor of a building, which was said to be equipped with an elevator, but which elevator they did not take; but walked down “more than one flight of stairs” and paused “a few minutes” on the way down because Balash, “very weak” and with pain in his chest and back, asked for rest. The hospital was on the second floor of another building, without an elevator, and distant “an eighth of a mile,” according to the estimate of the junior nnrse, from the first. It is manifest that the card, made up in some other department, from memoranda set down by the nurses on “a scrap of paper,” throws no light on the question whether Balash was stricken while raising a piece of goods to his shoulder after the lunch hour, as he testified, or during the lunch period, as respondent contends.

Eespondent chiefly relies upon the circumstances, as claimed by it, that Balash did not at once associate his seizure with his alleged raising of the goods and speak about it to his foreman, to Euttger, to the nurses. He said he did tell the foreman and a nurse, but they said he did not; and we think it highly probable that they are right. He was indisputably very ill and weak and in acute pain at the 'time—so stricken that he was confined to bed for three months—and his recollection of what he said, recalled sixteen and a half months afterwards, may well have been faulty and mistaken. But after having been detained “about half an hour,” according to the senior nurse, he was removed to his house and bed and the attention of a physician; and to that physician, Dr. Louis Cohen, who questioned and examined him between “one and two 3?. m..," on the same afternoon, and who found him “quite pale, drenched with perspiration,” in distress from pain in his chest, with low pulse, in semi-shock but “able to answer questions,” Balash said that “when at work, while lifting some heavy object, cloth or something” (the words are Dr. Cohen’s), he had suffered “severe pain in the chest,” left shoulder, and down his arm, and to his back. Respondent cites the eases of Tracey v. South River Lumber Co., 129 N. J. L. 546; 30 Atl. Rep. (2d) 412, and, with greater stress, Schlegel v. H. Baron & Co., 130 N. J. L. 611; 34 Atl. Rep. (2d) 132—both chiefly fact cases like this, and each distinguishable from this.

In the first mentioned ease, the claimant said that he had suffered a heart injury while loading a truck with lumber in the afternoon. It was established that it was no part of his duty to handle lumber, but that there was no truck in the afternoon on which he could have loaded it; his testimony is said to have been vague and very unsatisfactory; it was clearly overborne by the great weight of the evidence.

In the Schlegel case—concededly a coronary thrombosis case—the petitioner tardily attributed his disability to his having been struck violently in his chest by a falling case weighing, with its contents, sixty-two pounds, and testified that he lay helpless upon the case for three or four minutes until his assistant came to his aid. But he did not mention either to his assistant or to the general manager, whom he met on his way to a chemist, who gave him carbonate of soda, or to the superintendent, or to the physician who examined and treated him, his alleged accident. The latter, quickly diagnosing the case as a coronary thrombosis, expressly inquired of him what he had been doing when seized by pain, and the petitioner expressly denied that he had been lifting anything or that he had been struck by anything at the time. He was under the care of the physician for the following three weeks, and concedodly never told him of the alleged accident or mentioned it to the manager when the latter visited him at the hospital.

“It is inconceivable,” wrote Mr. Justice Heher in the opinion delivered for the Supreme Court, “that claimant would have failed to inform Ms attending physician of the accident, if one had occurred, on the occasion of the examination and treatment shortly after the attack, and during the three weeks he was under his care at the hospital. The least informed know that the attending physician’s resquost for the history, to aid in diagnosis and treatment, calls for the fullest disclosure in the patient’s own vital interest. Normal human reactions and behavior are elements to be considered in the appraisement of such evidence.”

In the present case, Dr. Cohen immediately drew from the patient the very history which Balash related in the Bureau. The history was not invented as an afterthought and an expedient. In the Schlegel ease the forcible blow from the falling box was everything or nothing. If it happened as the claimant ultimately described it, his silence for weeks about it is unaccountable.

But iu the ordinary sense of the term, Balash had no “accident.” He neither stumbled nor fell, nor collapsed, as Schlegel at length claimed for himself, when unexpectedly struck by an external object. The sense and symptoms of disorder came upon Balash while engaged in routine and commonplace work—work which he had done daily for at least seven years, and many times a day; and it was scarcely to be held against him that he failed to attribute his attack to an everyday act of exertion, when certain learned men, respectable or eminent in their profession, still solemnly deny any causal relation between muscular strain or physical effort and coronary occlusion.

It is clear that his foreman, once aware of the man’s illness, hurried him off to a nurse; and the nurse, to whose attention he oame, appears to have decided intuitively that she was dealing with a case of sickness, not of accident. To the question, “Did you ask him specifically just what he had dose before he got this pain across the chest?” her answer was in the negative: “That is np to the foreman. I did not ask him that question; that is up to the foreman.” Having given a distinct answer and her reason for it, she inconsistently said a moment or two later that she had asked him. But when pressed and searched on the matter, when expressly asked three or four times again whether she had asked Mm what he was doing when he felt pain, her first answer was unresponsive, if not purposely evasive, and her subsequent reply was, “I don’t know how to answer that question.” The recollection of both nurses was, at least, mistaken in part. Both said Balash was accompanied by two men, the senior nurse saying that the foreman *was one of them. The established fact is that only Buttger brought Balash to the hospital.

A pertinent ease, we think, is General Gable Corp. v. Levins, 122 N. J. L. 383; 5 Atl. Rep. (2d) 731; affirmed; 124 N. J. L. 223; 11 Atl. Rep. (2d) 61. Levins, while at work for his employer, struck his head on a beam, and everj'th-ing got black. When his sight returned, he finished his work, but felt there was something in his eye. The plant physician removed a foreign substance from his eye. The workman later consulted an eye specialist, who operated without effecting a substantial cure. Mr. Justice Perskie, speaking for the Supreme Court, said: “Nor does the fact, under the proofs of the case at bar, that respondent said nothing to prosecutor’s physician about the bump he received on his head operate to defeat Ms right to compensation for an injury he received arising out of and in the course of his employment. There is nothing to indicate, and no such claim is made, that he deliberately withheld such information. There is no reason why he should have withheld it save as he explains by saying that he didn’t Think of it.’ When respondent was asked by his own physician whether he had received a blow on his head, he freely admitted it, and the cause of the retinal detachments beeame obvious. Had prosecutor’s physician made the same inquiry, the same result would have or should have followed.”

About two weeks before the last day of August, or at some time late in the month of July, Balash, as has been already noticed, complained of stomach disorder and an ensuing headache occurring in the middle of the afternoon, or still closer to four-thirty. Balash laid down, at the suggestion of the foreman, and rested for the remainder of the afternoon. The foreman said that Balash complained, at about nine o’clock on the morning of August 31st, of pain in Ills back. Nothing appears to have been said about any pain in any other aiea of his body. In this instance Balash did not rest, but persevered in his work with no further complaint. Bor his lunch he had, in the superheated room, two boiled eggs, a roll, and a cup of coffee; and resuming his work, as he testified, at half past twelve, he marked the ticket, raised the folded cloth to his shoulder, and was stricken before he had placed the goods upon the truck. There is a confused story in the record of his having vomited at one time or another. He said this happened in the yard after he left the clinic. Buttger, who, after having conducted Balash to the nurse and was told by her that Balash was “a very sick man and was to go home,” went back to the examiner’s work room for Balash’s scissors, hat and coat, and testified, “The nurse told me that when I came back with his coat and scissors, the nurse told me he had vomited.” The nurse testified that Balash did not vomit in the hospital, and said that he told her he had not been feeling well over the “week end,” or during the morning of August 31st—“He was vomiting upstairs;” “he informed me he was eating egg sandwich in the morning, felt sick after.” There is no other sign in the record that he had vomited “upsairs.” Curiously enough, the junior nurse, who walked with Balash from the hospital to the employment office, testified that she inquired of him on their way: “I asked him if he had any vomiting before and he said Aver the week-end I had not been feeling well at all/ ” and added that while questioned by the senior nurse, “He specifically was emphatic about feeling sick after eating egg sandwich.” We suppose it was the nurse, and not the badly stricken man, who was “emphatic.” Neither nurse asked him any particulars about his having been unwell “over the weekend” or to what he attributed it; and there is an air about the testimony of both not quite satisfactory.

There is medical testimony that symptoms of indigestion may mean indigestion, or may be mistaken for indigestion and signify “a coronary insufficiency,” and that, as one of the respondent’s doctors, Dr. Jerome Kaufman, testified, „ “an act of lifting or strain may precipitate a coronary thrombosis.”

To the same effect was the testimony of Dr. Kleiner and the report of Dr. Boss.

As was stated by the deputy commissioner who heard the proceeding in the Workmen’s Compensation Bureau, Dr. Kaufman testified that the act of exertion which the petitioner said he underwent was sufficient to hasten an attack of coronary thrombosis, even in a man who already had premonitory symptoms of a heart attack. The degree of exertion is of no consequence so long as the performance of the required work caused a strain upon the heart. Molner v. American Smelting and Refining Co., supra.

There is no substantial disagreement about the percentage of the claimant’s disability. On the whole, we concur with the deputy commissioner, who had advantages for weighing the credibility of the witnesses which we do not share, that the weight of the evidence predominates in favor of the petitioner, and tiie judgment in his favor is affirmed.


source: Caselaw Access Project

author: Sb-wbbl, B. C. J.

license: Public Domain

text:
    First District Court of Jersey City.
    CATHERINE McNAMARA, PLAINTIFF, v. METROPOLITAN LIFE INSURANCE COMPANY, DEFENDANT.
    Decided January 11, 1945.
    For the plaintiff, E-dwavd De 8evo.
    Foe the defendant, J-olvn, P. Nugent,

   Sb-wbbl, B. C. J.

This is a suit instituted by one Catherine McNamara, beneficiary under insurance policy issued by the defendant company, insuring the life of one, James McNamara, in which policy the plaintiff was named as beneficiary in the event of death. It was stipulated by counsel for the respective parties that James McNamara died on February 17th, 1942, of injuries which were external and of a violent nature sustained by him on February loth, 1942. It was further stipulated that the cause of death was “intracranial hemorrhage and laceration of brain, following fracture of skull.” It was further stipulated that the policy of insurance contained the following clause, from which has been deleted all unnecessary phraseology:

“Upon receipt of due proof that the death of the Insured resulted independently of all other causes, from bodily injuries caused solely by external, violent and accidental means, the Company will pay, as an additional death benefit, an amount equal to the amount payable under the Schedule. * * * The additional death benefit shall not be payable if the Insured’s death * * * (e) is the result of participation in an assault or felony * *

It was further stipulated by counsel that the necessary ¡premiums on the insurance policy had been paid; that due proof of death had been submitted by the plaintiff to the defendant; that the policy was in full force and effeet at the 'time of death and that the defendant had paid to the bene'fieiary the sum of two hundred and fifty ($250) dollars-which was the face value of the policy.

The question in dispute is whether or not the company’ .should be compelled to pay an additional sum of two hundred’ and fifty ($250) dollars under and by virtue of the aforesaid accidental clause in the said policy.

The deceased died on February l-fth, 1-942, two days after injuries received by him in an affray with one, Walter Kolby, a former professional prize fighter. On the night of February 14th, 1942, the deceased McNamara and a friend, one, 'Michael Enright, attended a dance in the Greenville section; of Jersey City. They remained at the danee until about! three o’clock in the morning and then went to the lower section of Jersey City to a saloon, where they remained until! .about six o’clock in the morning; left the saloon and came to a restaurant located at No. 203 Pavouáa Avenue, Jersey City. As they entered the restaurant Kolby was having his breakfast before going to work. A package containing his 'lunch was on the stool next to him. There were fifteen stools before the counter, none of which were occupied except the aforesaid two. McNamara sat on the package containing 'Kolby’s lunch and a verbal altercation took place between 'Kolby and McNamara, which led to McNamara striking Kolby several blows with his fists. One of these blows knocked out one of Kolby’s teeth. During the assault Kolby removed Ms hat and coat. The proprietor of the restaurant stopped the ■assault, whereupon Kolby left the restaurant and went out on the sidewalk immediately in front thereof. The restaurant manager took Kolby’s hat and coat and threw them out to ’him. At this tíme McNamara followed Kolby to tíre sidewalk and struck or attempted to strike Kolby again. Kolby then struck McNamara one blow with Ms fist knocking him to (the sidewalk, causing injuries which resulted in McNamasa?s death two days later.

The attorney for the defendant conceded at the trial, and in a memorandum subsequently filed with the court that “had the policy not contained the 'assault’ clause, the plaintiff would be entitled to recover. This agreement is founded on the legally recognized fact that the death was due to means that were external, violent and accidental, as this latter word excludes only deaths that are the reasonably, foreseeable results of encounters obviously deadly in nature. Walter v. Prudential Insurance Company of America, 116 N. J. L. 304; 183 Atl. Rep. 897.

Defendant’s counsel contends, however, that the presence in the policy of the word “assault” in addition to the “external, violent and accidental means” clause relieved the defendant of the responsibility where the assured met his death as the result of being an aggressor in an assault.

It is the opinion of this court that the word “assault” as here used, means something more than a simple assault. The language is that the double indemnity shall not be paid to tiie insured if the i-nsurod’s death “* * * is the result of participation in an assault or felony.” If the insured had been killed while committing larceny, burglary, robbery, arson or any other felony, no liability would attaeh. The word “assault” as here used refers to such an assault as would justify the person assaulted, that is Kolby, in taking the assured’s life. In other words, before the defendant would be exempted from liability under the policy here sued on, MchTamara must have been guilty of such an assault as would justify Kolby aeting as a reasonable, prudent person in taking Ms life. I find as a matter of fact that while McKamara was the aggressor, the assault was not of such a character as would have led McKamam to reasonably contemplate that Kolby would be justified in taking Ms life in order to resist the same. Therefore, the defendant Insurance Oompany is not relieved of its liability to pay the additional indemnity under the policy. See Gilman v. New York Life Insurance Co., 190 Ark. 379; 79 S. W. Rep. 78; 97 A. L. R. 755 (at p. 758).

I find a verdict in favor of the plaintiff and against the defendant in the sum of two hundred and fifty ($250) dollars together with costs of suit.


author: Sidberman, D. 0. J.

text:
    Second District Court or Paterson.
    TIMMERMAN v. TIMMERMAN.
    Decided January 30, 1945.
    Por the plaintiff, Meyer W. Stein.

    Por the defendant, I. Artímr Weiss.
   Sidberman, D. 0. J.

This ■was an action instituted by the plaintiff to recover the sum of $2-59, being an alleged arrearage under an agreement executed between the respective parties on April 9th, 1941, wherein the defendant-husband agreed to pay to the -plaintiff-wife $7 per week. That such payments were made to the 1st of January, 1944, since which time the defendant herein has been in default. The copy of the agreement is attached to the state of demand and is entitled “In Chancery, &c.,” and is designated as a stipulation. It is signed by the respective litigants and their solicitors. There was introduced into evidence the decree nisi which beeame effective April 16th, 1941, and the decree of divorce which became absolute on July 16th, 1941. The petition for divorce and the answer were also by consent admitted into evidence.

The issue of jurisdiction was then raised by the defendant and it was stipulated by the respective attorneys to submit the matter to the court on memorandum.

I have perused the respective briefs submitted by counsel and digested the eases affecting this particular point. The plaintiff argues that the court of law has jurisdiction and amongst other things states that the present status of the litigants in tire District Court is that of single woman and man, and not that of husband and wife. Of course, that is the situation at the time of the institution of the District Court suit, but at the time of the making of the contract or stipulation between the respective parties, which is the time to be considered in construction and determination of the purported contract. It is definitely admitted that on April 9th, 1941, the parties were husband and wife and were subject to our law which does not recognize the right of the xecpective parties to enter into an agreement with each other.

In the eases referred to by plaintiff’s counsel, third parties instituted the action, either as trustees or by some other special right. In the ease of Apfelbaum v. Apfelbaum, 111 N. J. Eq. 529; 163 Atl. Rep. 548, the appellate court agreed with the lower court when the Vice-Chancellor held that equity would not enforce the alimony clause because that v/as enforceable in law; it appears that in the Apfel'baum case the agreement sued upon was entered into between the parties long after the wife had secured a divorce from her husband, which would then of necessity be actually an agreement entered into between a single woman, and a single man and recognized in law. Counsel referred to the case of Robertson v. Robertson, 114 N. J. L. 558; 177 Atl. Rep. 896, and in that case also the suit was by a wife against her father-in-law who guaranteed the payments under a separate agreement made between the husband and the wife. This 'was definitely a legal arrangement to answer for the debt of . another based upon an agreement made between the daughter-' ' in-law and the son, and the father-in-law as the outside third, party was subject to a suit at law; although subsequently-, this case was tafeen up on another point and reversed on the-theory of fraud, it did not in any way affect the original legal interpretation.

The case of Cohen v. Cohen, 121 N. J. Eq. 299; 188 Atl. Rep. 244, referred to by the attorneys in their briefs is a lengthy and very elaborate opinion by Vice-Chancellor Berry, holding that a contract between a husband and wife for separate maintenance prior to divorce, although not a contract for-alimony, is a contract concerning the Gommon law rights of, the wife to support and the provisions for support contained ' iu said contract, if fair and just may be enforced in the Court of Chancery, to the extent of a money deeree for acer-uedi arrearages. This case further held that such a contract-, because of the incapacity of the parties, is void at law but valid iu equity to the extent that it is equitable and just. -Equity has exclusive jurisdiction of contracts entered into between husband and wife. The fact that there is no capacity at law for them to make a contract is the controlling element. They are as a matter of fact void at law, but if fair, enforceable in equity. Wood v. Chetwood, 44 N. J. Eq. 64; 14 Atl. Rep. 21; Demarest v. Terhune, 62 N. J. Eq. 663; 50 Atl. Rep. 664, and Halstead v. Halstead, 74 N. J. Eq. 596; 70 Atl. Rep. 928.

There is no question that the contract upon which this action is based, is in essence a contract to pay alimony, and it is fundamental that alimony is a subject specifically committed to the Court of Chancery arising from the present or past status of the parties as husband and wife. The Divorce Act even goes further and states that the control continues after the decree of divorce is in effect. In cases where the wife is entitled to alimony, to regulate the amount of such alimony from time to time, to supervise agreements between the parties iu that regard, to enforce them if deemed just, and to decline to recognize them otherwise. See Calame v. Calame, 25 N. J. Eq. 548. Following the theory of the court in the ease of Lynde v. Lynde, 64 N. J. Eq. 736; 52 Atl. Rep. 694, we gather from that ease that the courts consider the' right to alimony which is a decree of money payments as a purely personal right, not in any sense a property right. On the other hand, contract rights are property rights. This distinction was also followed in the case of Adams v. Adams, 80 N. J. Eq. 175; 83 Atl. Rep. 190.

Mr. Justice Bodine, in the case of Zirk, Trustee, v. Nohr, 125 N. J. L. 610; 18 Atl. Rep. (2d) 10, referring to the Cohen ease says, “It has been held that a contract to support1 a wife, if fair and just, will be enforced in equity but that! such agreement is unenforceable at law because of the in-, capacity of the parties to contract as to that matter.” Of! course, in Zirk v. Nohr, the facts were entirely different and* there the court of law was the proper tribunal because there was no lack of contractual capacity in view of the fact that the father’s agreement was to pay to a third party for the support of a minor child.

There is no question in the court’s mind that the law is definitely settled in the controversies surrounding agreements for alimony or support signed by a husband and wife and, presented to a court of law for the enforcement in the sense of money damages. The relationship of husband and wife being one which restricts the individuals from entering into contracts with each other, cannot be properly a subject for a court of law. It is therefore a matter for the Chancery Court and the proper procedure would be for the plaintiff to institute her proceedings in the Court of Chancery for the purpose of obtaining a money decree on account of the defendant’s arrearage in support or alimony.

The judgment of the court will therefore be “no cause for j action,”


author: Thomas, S. C. Ct.

text:
    Small Cause Court of Gloucester County.
    ANGELINE R. HOY, PLAINTIFF, v. LAWRENCE R. MEYERS DEFENDANT.
    Decided January 25, 1945.

      For the plaintiff, Gurry S Pumeñ (George Pwmeffl)’.

    For the defendant, Lynwood Lord.

   Thomas, S. C. Ct.

Plaintiff rented the premises in question, 5 Focer Street, Classboro, to the defendant for the term of one year commencing on July 1st, 1942. The lease was renewed in 1943 but not in 1944. On October 28th, 1944, the plaintiff served -notice upon the defendant to vacate on December 1st, 1944. He did not do so; hence this suit.

The defendant produced evidence tending to show that the parties commenced negotiations for the sale of the property to the defendant. Mr. Cresse acted as intermediary but whether as agent for the plaintiff or defendant does not appear, nor did he testify in the matter although there are several points which he might have cleared up.

The only witness in the case was the plaintiff, Mrs. Hoy, called by both plaintiff and defendant. She admits the negotiations toward the purchase of the property. A copy of a letter from her to Mr. Cresse instructing him to sell to Mr. Meyers provided settlement was before February 1st, 1944, was produced by the defendant from the possession of the plaintiff. Ho settlement took place by that day, but later Mrs. Hoy sent to Mr. Cresse the deed to her to be given to the defendant, who is also an attorney, for the purpose of drawing a deed from the Hoys to him. This deed the defendant offered in evidence. The new deed was executed and sent to Mr. Cresse but recalled from him by Mrs. Hoy. Ho money has ever passed between the parties.

The defendant denies the jurisdiction of this court on the ground that a question of title to real estate is involved. He also set up at the trial that the defendant was entitled to 90 days’ notice instead of 30, and that the notice was improperly given for a 30 day notice because given 33 days ahead of time instead of 30 days.

It is the law that the Small Cause Court possessed no power to determine title to real estate. R. S. 2:9—16; N. J. S. A. 2:9-16. The exact wording of the statute is “A justice of the peace holding a small cause court shall not have any jurisdiction over * * * any action wherein the title to real estate shall come in question.”

It also appears to be the law that the question of title to real estate must be a real one and not one raised merely for the purpose of defeating the jurisdiction of the justice of the peace. The legislature apparently had this in mind when. they passed R. S. 2:33-39 and 40 and R. S. 2:58-25; N. J. S. A. 2:33—39 and 40 and N. J. S. A. 2:58—25. These read as follows:

R. S. 2:33-39; N. J. S. A. 2:33—39. “When, in an action in a small cause court, a defendant pleads as a justification title to real estate in himself or another under whom he acted, or entered, he shall mafee such plea ha writing and sign and deliver it to the justice, who shall countersign and deliver it to plaintiff, and thereupon dismiss the action.

“If plaintiff shall, within sixty days thereafter, commence' an action for the same cause in the supreme court or the circuit court of the proper county, defendant in such action shall be entitled to plead as a justification no other defense than the title to real estate in himself or another under whom • he acted or entered; and, if plaintiff recovers any damages I in the action in Hie supreme or circuit court, he shall recover his costs.”

R. S. 2:33-40; N. J. S. A. 2:33-40. “The justice, to whom a plea of justification is tendered, shall, before reserving the same, tafee from defendant a bond, with sufficient¡ surety, in the penally of one hundred dollars, executed to plaintiff in the action, and conditioned that, if plaintiff shall commence his action in the supreme or circuit court pursuant to section 2:33—39 of this title, defendant will appear thereto and pay such costs as may be awarded against him therein. If individual and not corporate surety is given, the surety shall consist of at least one person residing in the county and having sufficient freehold. If defendant does not give the bond herein required, the justice shall proceed in the action as if the plea had not been tendered.”

R. S. 2:58—25; N. J. S. A. 2:58-25. “If upon the trial the plaintiff shall not be able to prove, by lease or other evidence, his right to the possession of the premises claimed by him without proving title to lands, tenements and hereditaments, the justice of the peace shall dismiss the action.”

The last quoted section appears in the Landlord and Tenant Aet. The first two appear in the Small Cause Court Practice Aet. Do these first two sections apply to an action for possession instituted under the Landlord and Tenant Act?

In this connection, it is interesting to note that both Small Cause Court Act and the Landlord and Tenant Aet were: passed in the same yea-r and the same term of the legislature. It is also interesting that the District Court procedure ini dispossession proceedings is part of the District Court Act.

The Small Cause Court Act and the Landlord and Tenant Act were passed at separate times for separate purposes. The procedure for dispossession in the Landlord and Tenant Act is complete in itself; it needs no help whatsoever from the procedure in the Small Cause Court Act. R. S. 2:58-25; N. J. S. A. 2:58—25, can dispose of problems of title without the help of R. S. 2:33-39 and 40; N. J. S. A. 2:33-39 and 40.

It is true that it has recently been held.that in disposses- i sion proceedings the defendant is entitled to a bill of par-; tieulars although sueh a bill is not mentioned in the landlord i •and tenant proceedings. Earl v. Krug Baking Co. (Circuit Court, Bergen, 1944), 22 N. J. Mis. R. 424 ; 39 Atl. Rep. (2d) 784. But a bill of particulars is a common law right i and is not provided for even in the Small Cause Court Act.

Consider also the wording of B. 2:33-39 and 40; N. J. I 8. A. 2:3-3-39 and 40: “When * * * a defendant pleads as ■ justification title to real estate in himself or another under whom he acted or entered * * The words imply an action on the part of the defendant. Suppose in a trial in dispossession proceedings the defendant were to plead title in another under whom he held. In such circumstance M. 8. 2:33-39 and 40; N. J. 8. A. 2:33—39 and 40, would be inapplicable. The reason why the statute was so written was because the legislature intended that it Only be operative ¡in the ordinary practice of the court under the Small Cause Court Act and not under the landlord and tenant proceeding.

I therefore hold that R. S. 2:33—39 and 40; N. J. S. A. 2 :33—39 and 40, do not apply in this proceeding.

Let us now see whether the plaintiff has been able to prove her ease without proving title to lands. She has proved her right to possession in her own case by showing that the defendant held, under her as tenant. A tenant cannot question the title of his landlord. Den ex dem. Howell v. Ashmore (Supreme Court, 1849), 22 N. J. L. 261.

The tenant, however, contends that he purchased the premises from the plaintiff. Has he produced enough evidence to require the plaintiff to prove title to land?

What evidence must be produced by the defendant in order to require the plaintiff to prove title to land? It is that amount of evidence that would entitle him to go to the jury, iltf he has not produced enough evidence to go to the jury, if, after the close of his ease, the plaintiff is entitled to a directed verdict, then the plaintiff has not been required to prove title to land and this court still has jurisdiction.

The defendant has produced the following proof:

1. Oral testimony that the plaintiff agreed to sell him the land.

2. A copy of a latter of plaintiff agreeing to sell if settle- , ment were made before a certain date.

3. The deed from plaintiff’s grantor to plaintiff.

During the trial certain evidence was admitted which ■ should not have been admitted. Since the judge sat as a jury • and could weigh the value of doubtful evidence, the attorneys 1 may not have been as watchful as they might ordinarily have been. I am therefore constrained to hold that in this ease at least, incompetent evidence can be given no probative force and that the admission of such evidence eannot raise an issue or form the basis of a verdiet, finding or judgment. 33 C. J. S., Evidence, 1077, § 1034.

Examined under this ruling, what do we find5?

1. An agreement to sell sometime in the future under which no money has passed is not a present conveyance of real estate, at least not at law. See for example Potts v. Whitehead (Chancery, 1869), 20 N. J. Eq. 55, a case in some points similar to this.

3. A copy of a letter from the plaintiff to Mr. Cresse authorizing sale of the property providing action was taken within a stated time was produced by the defendant from the plaintiff’s possession. Mo explanation was given for the failure to produce the original. In fact, Mr. Cresse was not! called as a witness, a failure that is interesting as there are & number of problems which he might have solved. Mo copy may be introduced in evidence without explanation of the failure to produce the original. Bozarth v. Davidson (Supreme Court, 1841), 3 N. J. L. 617; Biehler v. Great American Indemnity Co. (Supreme Court, 1941), 127 Id. 114; 31 Atl. Rep. (2d) 225. In any event, the requirements of the letter were not complied with by the defendant. It proves no more than that there were negotiations.

3. I have made a painstaking search of the law and cases and I can find nowhere a statement that production of a deed to a supposed grantor proves title in a supposed grantee. Title to negotiable instruments may be transferred by delivery. Title to goods covered by a negotiable bill of lading may be transferred by delivery of the bill of lading. Title to goods stored in a warehouse may be transferred by delivery of a warehouse receipt made out to the beam1. However, I have never heard of title to real estate being transferred by delivery of a deed. I conclude that the deed is no evidence of title in the defendant, but is only evidence that it conveyed title to the grantee therein mentioned.

It follows that the defendant has not introduced evidence requiring the plaintiff to prove title to real estate. This court has jurisdiction.

At the trial it was agreed that the briefs of the parties would include the questions concerning the length of notice to which -fee defendant was entitled and whether the notice mus-t be given exactly 30 days in advance of the termination date. The defendant, also by agreement, filed the first brief but failed to concern himself w-ith these questions. I assume that they are abandoned.

Judgment is rendered for the plaintiff for possession of. the premises and for costs.


author: Fielder, V. 0.

text:
    Stella Pollack et al., executors, &c., complainants, v. Harold H. Bowman et al., defendants.
    [Decided February 20th, 1945.]

      Messrs. Siuhr & Yogi (Mr. ESward A. MarJdey and Raymond J. Lamb, of counsel), for the complainants. 1

      Mr. WiíU-am F. Sinehliffe (Mr. Edward A. MarTdey, Mr. Raymond J. Lamb and Mr. Hugh 0. Spernow, of counsel), for the defendant Little Sisters of the Poor.

      Messrs. Pitney, Hardin & Ward (Mr. Mahlon Pitney, of counsel), for the defendants Harold H. Bowman et al., trustees.

      Mr. Leo M. Rogers, for the defendant estate of Isabell MacDonald.
   Fielder, V. 0.

Andrew T. Fletcher died June 26th, 1930, leaving a will and codicil admitted to probate by the surrogate of Passaic County under which letters testamentary were granted July 9th, 1930, to the defendants Harold H. Bowman and The Paterson Savings Institution, the executors and trustees therein named (hereinafter called executors or trustees). By his will and codicil the testator gave all his property to said trustees to invest and keep invested and to pay the income therefrom to Joseph Hosek, Isabell MacDonald and other name individuals and he gave the principal of the trust, on the death of the last survivor of said beneficiaries, to the Little Sisters of the Poor (a charitable corporation).

Joseph Hosek died January 22d, 1939, leaving a will under which complainants Stella Pollack and William F. Hosek qualified as executors. Three years later (January 26th, 1942), HoseMs executors filed their bill in this cause and by it, and an amended bill, they charge the trustees with mismanagement of the Fletcher estate in certain specific respects, whereby loss resulted to that estate, to Joseph Hosek and other life beneficiaries and to Little Sisters of the Poor; they seek to compel the trustees to account for such loss. Isabell MacDonald was named as a defendant in the suit and a decree pro confesso had been entered against her. She died pending the suit and said decree was opened to permit her estate to enter an appearance.

At the outset it should be stated that I find no proof of fraud, lack of good faith, or self dealing on the part of the executors or trustees, or unlawful investments made by them. The question involved is whether they exercised reasonable diligence in the administration of the estate committed to their care.

Tlie first charge made against the executors and trustees is with regard to the sale by them as executors of the entire issue of 500 shares of stock of Bakers and Consumers Compressed Yeast Co. (hereinafter called Yeast Co.).

Fletcher, for many years prior to and at his death, had been engaged in the business of a wholesaler of yeast. He had owned all the stock of the Yeast Co. and had transferred those shares, with other stocks and bonds, to Bee Financial Co., a holding corporation (hereinafter called Bee Co.) in which he owned the whole stock issue. Almost immediately after Fletcher’s death the executors sought a purchaser for the Yeast Co. stock and in the meantime they continued the operation of the corporation. On or about May 4th, 1931, they sold to James J. Hastings, through the Bee Co., all the stock of Yeast Co. for the consideration of $350,000, of which $200,000 was to be paid in cash by Hastings and the balance of $150,000 was to be paid in successive annual installments of $25,000 each with interest, evidenced by Hastings’ si-x promissory notes and they took as collateral for payment of the notes 250 shares of Yeast Co. stock and a poliey of insurance on Hastings’ life. Payment of each of Hastings’ notes was expressly made conditional on the existence of the Yeast Co. on the date the respective notes became due. Shortly after the sale the Bee Co. was dissolved, the executors taking over the assets of that corporation, including Hastings’ notes. When the sale was consummated the $200,000 Hastings was to pay the executors was paid by Hastings’ check for $100,000 and the cancellation of a debt of $100,000 which Fletcher owed the Yeast Co. Much testimony was taken on the complainants’ claim that Fletcher’s indebtedness to the Yeast Co. was only $60,000 bnt I am satisfied, by analysis of that testimony, that his debt was actually $100,000 and that the executors were justified in accepting that amount as correct. When the first of Hastings’ notes for $25,000 became due May 4th, 1932, he paid $5,000 on account and did not pay the balance in full until January, 1934. Hone of Hastings’ other notes has been paid and Hastings abandoned the Yeast Co. some time in 1939.

The Yeast Co. had obtained its supply of raw yeast from Fledsehman Co. and Standard Brands and they wore its sole source of supply at a price at which the Yeast Go. could ‘operate at a profit and they could cut off the supply at any 'Mane. Tie executors feared to continue to operate the busi>ness themselves with the risk that the supply of raw yeast .might be terminated suddenly and the Yeast Co. be put out of business. They were faced with the alternative of finding a purchaser for their stock or liquidating their corporation. .There was no ready market for the stock and it had no certain marketability. They endeavored to sell to Standard Brands, or to some person connected with that corporation and they .tried to find other purchasers, all without success. Hastings :was a certified public accountant and for several years had' ■been the accountant for F-letcher, Yeast Co. and Bee Co. and : through that connection had acquired some knowledge of the .yeast business. The ex-eeutoxs knew him and they considered ■ him to be an honorable man who would conduct the business ' capably, and when he approached them with an offer he was • the only purchaser they had been able to find. He made several offers which the executors rejected and when his final . offer was made, it was the best they had been able to get and (the situation, as it appeared to the executors, was whether ito accept it or liquidate their corporation. The testator’s will authorized them to sell any of his estate on such terms as they might see fit.

The assets of the Yeast Co. consisted of real estate the fair market value of which at the time of the sale was about $40,000, and accounts receivable, machinery and fixtures having no greater book value than $G0,000, all of which assets probably would, not have realized a total of $100,000 on 'liquidation. But complainants insist that beside those assets the eompany had a good will of considerable value for which the executors should have received a consideration. The Yeast Co. had been a profitable business under Fletcher’s management and had realized considerable profit down to his death but its good will depended on Fleteher’s business ability and management and upon the personal relations he had established with Fleisehman Co. and Standard Brands, the advantage of which relation they might terminate at any time after Ms death. Moreover a general business depression existed in 1930 and Hastings was the sole available customer for the Yeast Co. stock; he declined to consider good will of any value, except as it might be represented in the $150,000 notes he offered as part of the purchase price and made payable only in ease he could operate the company successfully. I think that when the executors received cash on the sale of the Yeast Co. stock, they received as much, if not more than they would have received if they had declined the offer submitted by the only purchaser in sight and had liquidated their corporation. Beside the cash received they had the expectation and possibility of realizing $150,000 on Hastings’ notes and in fact they received $25,000 in payment of his first note and therefore they received a total of $125,000 and some interest in exchange for the fixed assets of their corporation, and Fletcher’s liability of $100,000 to Yeast Co. was canceled.

I find that when the executors agreed to sell to Hastings they understood and believed from his statements to them that he intended to raise on his personal credit the $100,000 he was to pay them on account of the purchase price of the stock and I think such was Hastings’ original intention but he failed to realize on it. Instead and pursuant to an arrangement he made shortly prior to the date for closing the sale, he borrowed $110,000 from a finance corporation and secured that loan by a mortgage on the Yeast Co. assets. It was from the proceeds of that loan he paid $100,000 to the executors so that no funds of his own were used for the purchase of Yeast Co. stock. Of eourse the terms on which the sale of the stock was consummated made it possible for Hastings to borrow on the corporation assets without the executors’ knowledge or consent and he could have done that very thing at any time after he became owner of the 500 shares. Complainants contend that the executors, as part of the conditions of sale to Hastings, should have insisted on having representation on the hoard of directors of the Yeast Co. and thus maintain supervision over Hastings’ operation of the company and that the exeeutors also should have insisted on holding the whole 50-0 shares of Yeast Co. stock as collateral for payment of Hastings’ notes. The executors had endeavored to secure better terms from Hastings than those finally agreed on, including pledge of all stock and directorship representation, but Hastings refused to agree to such terms. The executors feared to continue to hold the Yeast Co. stock and to continue to operate the company and since Hastings was the only prospective purchaser and the executors were to receive all they believed the tangible assets of the corporation were worth, I think they were justified under the circumstances in agreeing to sell on the terms on which he was willing to become a purchaser.

The complainants further contend that the executors, before finally consummating the sale, were aware that Hastings was not intending to pay $100,000 from funds raised on bis personal credit but had arranged to pledge the assets of the Yeast Co. to raise said sum and with that knowledge they should have refused to go through with the sale. It is my opinion that they had no such knowledge; if they had, I think they would have declined to transfer their stock. Executor Bowman and Patón (the latter an officer of the corporate trustee) had been directors of the Yeast Co. after Fletcher’s death and had resigned in favor of Hastings’ nominees prior to the meeting of the Yeast Co. directors at which the loan was approved and the mortgage authorized. On closing the sale Hastings produced his two checks of $100,000 each with which to pay the $200,000 called for by the agreement of sale on transfer to him of the shares of stock, both cheeks being drawn to the order of Bee Co. One of those checks went to the executors through Bee Co. and the other was endorsed by Bee Co. payable to Yeast Co. and represented payment of Fletcher’s debt to Yeast Co. That cheek was delivered to Hastings for the Yeast Co. but he kept it and it was never cashed. Criticism is made that the executors should have seen to it that the proceeds of the latter cheek actually went into the treasury of the Yeast Co. Having delivered that check to Hastings, who was president of Yeast Co., I do not think it was the duty of the executors to see that he applied it properly. That check canceled Fletcher’s debt to the Yeast Co. and his notes evidencing the debt, were surrendered to the executors.

The executors filed their first and final account August 5th, 1981, wherein they charged themselves with the amount of the inventory they had filed and, by way of schedules, detailed additions thereto and items for which they sought allowance. Those schedules were essential parts of the account and determination of the correctness of the account and of the balance with which the executors were chargeable, could not be made without reference to and examination of them. The first schedule of increase in corpus stated the'dissolution of Bee Co. and the receipt by the executors of the assets of that corporation, including Hastings’ notes for $150,000 therein stated to be part of the consideration for the purchase by Mm of the Yeast Co. stock. Then followed a statement of the sale of that stock to Hastings and an explanation in considerable detail of the terms of sale, all of which I consider was amply sufficient to put all parties in interest on notice of the fact and terms of that sale and on inquiry concerning it, and to require them to present to the Orphans Court by way of exceptions, any objections they might have had thereto, but no exceptions were filed and on September 17th, 1931, the Orphans Court entered its decree approving the account. That decree entered on due notice to all beneficiaries under I’letcher’s will estops them from now making any objection to the sale or to the terms and conditions on which it was made. Shearman v. Cameron, 78 N. J. Eq. 532; Beam v. Paterson, &c., Co., 96 N. J. Eq. 141; affirmed, 99 N. J. Eq. 427; In re Leupp, 108 N. J. Eq. 49; Rothenberg v. Franklin Washington Trust Co., 127 N. J. Eq. 406; affirmed, 129 N. J. Eq. 361; In re Schlemm, 130 N. J. Eq. 295; Brown v. Fidelity Union Trust Co., 135 N. J. Eq. 404.

The executors turned over to themselves as trustees the stocks, bonds and other securities (including Hastings’ notes) representing the balance decreed to be in their hands and in the seven accounts thereafter filed by trustees, each allowed by Orphans Court decree (the last on October 20th, 1938), appear items which would call attention of the beneficiaries to the fact that only the first of Hastings’ six notes had been collected, but the beneficiaries failed to except to any of those accounts or to make objection in any way to the trustees’ failure to collect the balance of Hastings’ notes.

Having received the Hastings’ notes, the question is whether the trustees were guilty of negligence in failing to collect them. Complainants contend that tíre trustees certainly learned as early as March, 1932, of the mortgage Hastings had placed on the Yeast Co. assets and that they should have proceeded against Hastings when he defaulted on his first note which fell due in May, 1932. I think it was too late to attempt to disavow the sale they had made as executors since it appears that Hastings acted within his legal rights in effecting the loan to the Yeast Co. and the mortgagee of the Yeast Co. assets had a paramount lien thereon. The trustees then could only expect that Hastings would be able to discharge his first and subsequent note obligations if he were left to maintain the corporation as a going concern, because those notes were not the ordinary form of promissory note; they were not to become due and payable unless on the due date Hastings remained in the yeast business.

The first, note fell due May 4th, 1932, and being unpaid, suit might have been brought thereon at onee for the balance due after Hastings had paid $5,000 on account. Likewise suit might have been brought on the other notes as they fell due up to May, 1937, for Hastings remained in the yeast business up to 1939, but suit on the first note probably would have forced Hastings out of business and thus he would have been relieved from liability on his other notes and as a matter of fact the first note was paid in full. When the second note fell due in May, 1933, conditions in the yeast business were bad and so continued as the remaining notes matured. The question facing the trustees in 1933 was whether to sue Hastings on the note which became due that year. They learned that he was financially irresponsible and they decided that their only hope of collecting on his notes was through permitting him to continue in business and they felt that if they pressed him they would force him out of business and into bankruptcy. Standard Brands was the Yeast Co.’s large creditor and that company made concessions to Hastings on the price of raw yeast and not only refrained from attempting to collect its debt but canceled a portion thereof and helped him rebuild his plant and install new equipment. Thus the trustees liad reason to hope that the yeast business would show better results and their judgment was that it was wiser to permit Hastings to continue in business rather than take steps which might result in forcing him out.

When Hastings’ business situation failed to improve, negotiations for settlement through the trustees’ attorneys resulted in an offer by Hastings to settle for $2,500. Late in 1939 or early in 1940 Little Sisters of the Poor and all life beneficiaries under Fletcher’s will (except Hosek who had died) gave written authority to the trustees to accept such settlement and agreed to release the trustees from all claims by reason of so doing. Hosek’s death terminated his interest in the estate but because his executors objected to the settlement, the trustees submitted it to the Passaic Orphans Court for instructions but before that court had acted thereon this suit was instituted. By counter-claim filed by the trustees that offer of settlement is now before this court for determination.

I am of the opinion that the trustees should be authorized to accept $2,500 in settlement of Hastings’ indebtedness to them, which indebtedness has been kept alive by a token payment thereon to toll the statute of limitation. Hastings, as I have said, is a public accountant and so far as any of the parties in interest have been able to show, he has no assets in his own name other than the 500 shares of worthless Yeast Co. stock. His only income is from his profession and that net income for 1939 was $341.88 hut it had increased to about $8,000 net for 1943. Some proportion of his income might be collected in monthly installments under execution on a judgment recovered against him but even so it would take several years to collect as much as $2,500. He had failed to pay premiums on his life insurance policy held by the trustees as collateral for his notes and for a time the trustees paid the premiums, but finally surrendered the policy for its cash value. He had purchased a home in 1929 for $17,500, title to which he transferred to his wife in 1936. What the present value of that property is and what encumbrances there may he against it do not appear. That transfer might he set aside as in fraud of creditors but it is possible that his wife might have a valid defense to a suit for that purpose. The Yeast Co. stock is worthless. That corporation went out of business in 1939 and since then it has been a defunct corporation. It was then indebted to Standard Brands to the extent of $340,000 and Standard Brands advanced money to pay its other creditors and thereupon asserted a claim to a first lien on all Yeast Co. assets, including its r-eal -estate which is in a dilapidated condition and against which there are arrearages of taxes. Considering the expense which would be involved in litigation to recover anything on account of the trustees’ claim, the uncertainty of the net amount of recovery and the ever present possibility of bankruptcy, the trustees will be authorized to accept Hastings’ offer of settlement.

The complainants seek to charge the trustees with losses sustained through their failure to dispose of the common stocks owned by the testator which they received as executors and transferred to themselves as trustees.

The inventory of the testator’s personal estate shows a list of securities appraised at $837,863.63 made up in part of 33,750 shares of Standard Brands common appraised at $436,406.35 and other common stocks appraised at $57,536.09. The executors’ account shows that through dissolution of Bee Co. they received 3,300 additional shares of Standard Brands common valued at $43,363.50 and other common stocks valued at $93,504.13. Pursuant to the decree entered September 17th, 1931, on the executors’ account, the executors turned over to themselves as trustees 36,050 shares of Standard Brands at $18-3/8 per share for a total • of $478,668.75 and other common stocks valued at a total of $150,030.33. Thus about 75% of the estate was represented by common stocks practically all of which (except for the sale of some Standard Brands) are still held by the trustees with the result that as between inventory or book value and market value as of the last date of hearing of this cause (October 34th, 1944) a loss of nearly $150,000 is shown. Those stocks now represent investments in about thirty different corporations.

A difficult situation with regard to administration of the estate faced the executors and trustees at and after the testator’s death. It is easy to say now, with our present knowledge of what happened, that the trustees should have disposed of all common stock and taken such loss as against book or inventory values as might have resulted, instead of retaining their holdings on a falling market in the mistaken belief that better prices would return.

There was a general decline in market prices of all stocks in and after 1930 and the trustees show that in determining whether or not to dispose of their stock holdings, they relied on reports of financial and investment publications and the advisory opinions therein contained, as well as on advice frequently sought and obtained from bankers, brokers and other financial sources. They point to the collapse of many banks and to the bank holiday declared in March, 1933, also to the fact that the United States Government had gone off the gold standard at or about that time and to the general prediction in investment and banking circles of coming money inflation which would have a depressing effect on the value of bonds and dollars, and it was their judgment in 1931 and 1932 that retention of common stocks of corporations whose business it was to produce goods and services was proper and desirable as providing adequate security for the beneficiaries of their trust. Sharp differences of opinion arose in 1933 between trastee Bowman and the vice-president of the corporate trustee who had charge of the estate, as to whether the trustees should not dispose of all their Standard Brands stock. Their differences were based on careful studies each had given to that stock and they reached different conclusions. Bowman favored such sale and his eo-trustec did not but they finally agreed on sale of 11,000 shares as hereinafter stated, and although Bowman continued to urge further sales of that stock throughout 1934 he finally deferred to the opinion of the banker who was supposed to have better judgment in financial matters than Bowman, a lawyer, and no more stock was sold until August, 1939. I consider the fact that the trustees argued as between themselves as evidence that each was giving careful thought and due consideration to the proper performance of his duties. As to other common stocks, the market fell so rapidly that it was the trustees’ belief they should not sell at sacrifice prices but should wait for a reaction. There is no proof that the trustees did not at all times give diligent and honest consideration to their duties or that the retention of the common stocks was not the result of their disinterested conviction that they were pursuing the wisest course. The trustees were not bound to act correctly and at their peril if they made a mistake in. honest judgment in retaining the investments which came to their hands as part of their testator’s estate; they were only bound to act in good faith with reasonable discretion. In re Megargee, 117 N. J. Eq. 347; In re Cross, 117 N. J. Eq. 429.

That their judgment was good in deciding not to sell Standard Brands at the declining prices of 1931 and 1932 is shown by the fact that in a market rebound of that stock in June and July, 1933, they sold 11,000 shares at an average price of about $33 per share, thus realizing a profit of approximately $150,000 over book value. Thereafter the stock showed a steady decline; it reached a low of $2-7/8 per share in 1942 but the trustees made no further sale of that stock until August, 1939. Beside the investigations and inquiries I have mentioned made by the trustees concerning all the common stocks they held, they made special investigation concerning Standard Brands, as to its assets and earnings and the corporation’s book value of the shares and they were impressed by the fact that Standard Brands never failed to pay dividends, although at decreasing rates, which dividends based on market prices for the stock produced a favorable income yield for their trust. The testimony shows at great length the frequent and careful inquiries made independently by both trustees into the condition of Standard Brands, their conferences with men whose business it was to deal in securities and their study of information and advice given by those men and by investment publications all of which led them to believe in retention of that stock. It is easy to say now that the trustees should have disposed of all Standard Brands stock in 1933 when they sold 11,000 shares, or in 1934 or 1936 when they could have sold the balance of their holdings at some profit above book value, but whether they acted with reasonable care, prudence and discretion must be determined on the basis of the situation as it then appeared to the trustees. I believe that in good faith they acted on what they considered good judgment and reasonable discretion in continuing to hold their common stocks, at least until 1938 and at no time did any of the beneficiaries make objection to the trustees.

Beside the executors’ account filed and allowed in 1931, the trustees filed seven annual accounts, the first one August 17th, 1932, and the last September 17th, 1938, each of which •after due notice to all beneficiaries according to statute, was approved and allowed by Orphans Court decrees. Pursuant to an Orphans Court rule then in effect, each account had annexed thereto a schedule or list of securities in which the •estate was invested, the list showing trustees’ book value of each security and such list in every account showed that the trustees still held the common stocks which had come to their hands as investments made by their testator. The rule of court referred to was promulgated by the Ordinary under the authority of R. S. 2:30-l and it has been held that Orphans Court rules are as binding as the statutes (In re Sinovcic, 80 N. J. Eq. 260). It is said in reported and unreported cases in this state that notwithstanding the rule, such a statement is not a part of the account and that an Orphans Court decree approving an account does not carry with it approval of any investment shown in such statement, in the absence of any issue raised before the court with respect to investments. It will be found that the investments involved in those cases were such as were challenged as having been made •contrary to the direction of a testator’s will, or as unlawful investments, or as non-legals. In the instant case all common stocks were the testator’s investments and came to the hands of the trustees as such. It was lawful for the trustees to continue such investments in the exercise of good faith and reasonable discretion. Comp. Stat., p. 2271, § 34; R. S. 3:16-12.

The list of securities annexed to the executors’ and trustees' several accounts and the items in each account which show receipt of dividends from stocks, gave notice that the trustees continued to hold the common stocks and imposed on all parties in interest a duty to file exceptions to the accounts if they were not satisfied and content that the trustees were acting in good faith and with reasonable discretion, in continuing to hold the same. If they chose to ignore those accounts and neglected to examine them, they should not be permitted to urge that they were not bound to know the situation thereby disclosed with respect to the common stocks. Failing to object, I think the decrees of the Orphans Court bar them from now asserting that the trustees failed to act in good faith or with reasonable discretion in continuing to retain such investments, at least down to the date of allowance of the trustees’ last account. Beam v. Paterson &c., Co., supra; In re Cooke, 96 N. J. Eq. 589; affirmed, 99 N. J. Eq. 423; City Bank, &c., Co. v. McCarter, 111 N. J. Eq. 315; Rothenberg v. Franklin Washinglon Trust Co., supra; In re Schlemm, supra; In re Ward, 121 N. J. Eq. 555; affirmed, 121 N. J. Eq. 606; In re Rothenberg, 129 N. J. Eq. 377; Van Buren v. Plainfield Trust Co., 130 N. J. Eq. 244.

Hosek, whose representatives filed the bill in this cause three years after his death January 22d, 1939, was interested solely in receiving a portion of the net income of the estate during his life, and so was Isabell MacDonald. They were under a duty to object to the accounts if it appeared to them that the estate was not invested safely so as to produce the maximum amount of income for their respective lives. As to them there can be no adjustment of income because, there being no fraud or mistake with respect to the trustees’ accounts, the decrees entered thereon were certainly binding on them as to the correctness and finality of the income charge and discharge portions of each account down to and including the last account filed a few months prior to Hosek’s death. Some time toward the end of 1931 in a discussion of the accounts of the estate with one of the executors, Hosek had approved the various common stocks afterward taken over by the trustees and had stated his wish that the trustees would not sell any Standard Brands but would continue to hold that stock. In February, 1932, he had his attorney inspect the inheritance tax proceedings of the estate (which proceedings showed the estate securities) and subsequently his attorney received copies of the trustees’ first four accounts. The Little Sisters of the Poor discussed the estate frequently with the president (now dead) of the corporate trustee and it does not appear that it ever made objection to any of the trustees’ accounts. As a defendant named in the bill of complaint, the Little Sisters of the Poor merely filed a formal answer to the bill and never sought affirmative relief as against the trustees until this cause came on for final hearing.

After 1933 the common stocks held by the trustees continued to drop in market value. The judgment of the trustees that they should hold those stocks, first exercised at the time of testator’s death and thereafter continued, proved to be erroneous although reached in good faith. The hope or expectation in which they indulged that there would be an upturn of the market and that the market value of those stocks would increase in time to approximately inventory value, had not been realized when they filed their 1938 account and it was about that time that earnings of Standard Brands fell off and its dividends were reduced. Published investment advice was unfavorable as to continued holding of that stock and Bowman was again urging its sale. I think that in the exercise of reasonable discretion the trustees should have known in 1938 that they held an undue number of shares of common stocks of uncertain value and that it was their duty to have sought allowance in their 1938 account for depreciation in the book value of their assets (as they did in the account they filed with this court in 1942), or to have petitioned the Orphans Court for instructions as to whether or not to continue those investments, but they did neither and except for sale of some shares of Standard Brands they continued to hope on a falling market and now fourteen years after testator’s death they still hold those stocks, on at least some of which loss has been suffered even on the basis of market value those stocks had in 1938. I think the time has come when the trustees should be directed to dispose of all common stocks, except of course those which had become worthless prior to 1938 and have had no value since that time, and that they should be charged with any loss sustained since 1938 to be determined on the basis of the market value of their stocks as of the date of the decree allowing their last account, which decree in effect fixed their accountability for whatever value those stocks had at that time (Brown v. Fidelity Union Trust Co., supra) and which date was the last time the beneficiaries may be said to have assented to the retention of those stocks.

As to Standard Brands, the trustees held 15,050 shares of that stock at the time of their 1938 accounting. They sold none of those shares until August, 1939, and between that date and February, 1940, they sold 5,050 shares at an average price of $6-% a share, thus, suffering a loss of approximately $60,000 on the basis of book value. It should be stated that in 1943 Standard Brands reduced its shares of common stock in the proportion of one new share for each four shares, which does' not affect the nature or amount of the trustees’ holdings for the purposes of this ease. To avoid confusion I speak of the stock as though the trustees still hold 10,000 shares. The net result of all sales of Standard Brands shows a profit to the estate of about $90,000 over book value but the trustees still hold 10,000 shares the market price of which on the last day of the hearing of this cause was $7-% per share, or a then depreciation on those remaining shares of about $110,000 as against trustees’ book value. Believing that the beneficiaries are estopped from complaining of the failure of the trustees to dispose of the 15,050 shares they held up to the time of allowance of their seventh account, I think the trustees should be charged with the market value of those shares as of the date of allowance of that accounting, which the testimony shows was $8-% per share. After making sale the trustees will be surcharged with whatever loss they will be found to have sustained on 15,050 shares, such loss to be the difference between the sale price and $8-% per share.

As to the balance of the common stocks held by the trustees which they will be directed to dispose of, some testimony was taken to show the fluctuating prices on several of those stocks but the testimony does not show what the market price was on any of them as of the date of the allowance of the trustees’ seventh account. Reference to a master will be necessary to ascertain the fact and the trustees will be charged with the net difference between the prices at which they disposed of those stocks and the market prices so ascertained.

It follows that the trustees’ report and account made part of their counter-claim filed in this cause, wherein they praj allowance (among other things) for depreciation in value of some common stocks based on the difference between book and market value and wherein, in their statement of assets on hand as of January 15th, 1942, they show a difference by way of depreciation between book and market value of other common stocks, cannot be allowed. They will be directed to file a supplemental account after they have disposed of all common stocks, to show the result of such disposal and to bring their account down to date.

Complainants seek a decree that the trustees forfeit all commissions and be removed as trustees. That decree will not bo granted. The proofs show honest mistake in judgment on the part of the trustees but no bad faith. Babbitt v. Fidelity Trust Co., 72 N. J. Eq. 745; McAllister v. McAllister, 120 N. J. Eq. 407; affirmed, 121 N. J. Eq. 264; In re Johnston, 127 N. J. Eq. 576; affirmed, 129 N. J. Eq. 104; Rothenberg v. Franklin Washington Trust Co., 131 N. J. Eq. 463.


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    New Jersey Department of Labor, Workmen’s Compensation Bureau.
    PHOEBE FEY, PETITIONER, v. COUNTY OF ESSEX, NEW JERSEY, RESPONDENT.
    Decided February 3, 1945.
    Por the petitioner, Maurice M. Margolis.

    Por the respondent, Edwin Joseph O’Brien.

   A formal petition was filed in the above entitled matter making claim for compensation, pursuant to R. S. 1937, 34:15; N. J. S. A. 34:15.

This matter was tried before me on March 3d, 1943, and a determination of facts and rule for judgment was entered, among other things giving judgment in favor of the petitioner and against the respondent for compensation for permanent disability on the basis of 30% of total disability, or 150 weeks at her compensation rate of $15.38, or a total of $2,307. The respondent made payments pursuant to said determination to the above named petitioner for a period of 61 weeks; in addition thereto respondent advanced the sum of $120 from the payments last to become due. On May 10th, 1944, said petitioner, Phoebe Pey, died, leaving her surviving a husband, William Pey.

This matter was again brought on for hearing before me at the Compensation Bureau in Newark on November 29th, 1944.

It was stipulated that the above named petitioner, Phoebe Pey, died from causes unrelated to the accident, and the question presented to me foT determination was whether or not William Fey, husband of Phoebe Fey, deceased, was a dependent within the intendment of the Workmen’s Compensation Act, so as to become entitled to the unpaid balance of the award made to the said. Phoebe Fey, amounting to $1,248.82.

Mrs. Michael, a daughter of the deceased petitioner, testified that her father, the husband of the deceased petitioner, was at the time of decedent’s injury and death an inmate of the Newark Convalescent Hospital and that, due to the fact that he was an extremely obese individual, it was necessary for all of his clothes to he made to his measurements and that-all clothing bills were paid for by her mother in her lifetime. It further appeared from her testimony that it was necessary for William Fey to wear an iron brace on one leg and that, because of this, his clothing would wear out rapidly and would have to he replaced at frequent intervals. In addition to the clothing, the decedent purchased on numerous occasions braces and special shoes for William Fey’s deformed leg, and these articles were not furnished by the hospital.

The statute directs in section 34:15—12, subd. z, that in cases of death of a person from any cause other than the accident during the period of payment for permanent injury, the remaining payments shall be made to the dependents of the injured person.

Under the case of Holden v. Public Service Electric Co., 127 N. J. L. 405; 22 Atl. Rep. (2d) 795, 796, a situation presents itself in which the facts are similar to the ones in the instant ease, with the exception that the wife was the inmate of a public institution at the expense of the municipality. The court found the liability for such institutional eare for such dependent is forever present and "the deceased was not relieved of the obligation of maintenance. * * * The latter liability for such institutional eare and maintenance of his wife remains unimpaired * * The fact that in the present ease it is the husband who is in a public institution under public charge does not relieve the wife of the legal responsibility to pay this obligation of her dependent husband. Under the statute 44:1-140; N. J. S. A. 44:1-140, certain relatives are chargeable by law for the maintenance and relief of poor, old, blind, lame or impotent persons. These persons chargeable are “the father, grandfather, mother, grandmother, child, grandchildren, and husband and wife, severally and respectively * *

It is, therefore, the opinion of the court that William Fey is a dependent of the deceased Phoebe Fey within the meaning of the Workmen’s Compensation Laws and the amendments thereto and as such dependent is entitled to receive the balance of the compensation due under the rule for judgment of March 3d, 1943.

John C. Wegner,

Deputy Commissioner.