author: Walker, Y. C.

text:
    The Prudential Insurance Company of America v. James Godfrey, administrator, &c., et al.
    [Decided February 20th, 1909.]
    A policy of insurance was issued by the complainant company, payable unto the executors, administrators or assigns of the person insured, unless settlement should be made under the provisions of article 2 thereof to any relative by blood, or connection by marriage of the insured, or to any other person appearing to the company to be equitably entitled to the same by reason of having incurred expense in any way on behalf of the insured- for her burial or for any other purpose, and the production by the company of a receipt signed by any or either of said persons or of other sufficient proof of such payment to any or either of them should be conclusive evidence that such benefits had been paid to the person or persons entitled thereto, and that all claims under the policy had been fully satisfied, such article being for the facility of payment by the company. Immediately after the death of the person insured her half-sister furnished proofs of death and made claim for the sum insured, having paid the premiums on the policy which she surrendered, together with the premium receipt book. Afterwards the decedent’s husband was granted administration upon her estate and made claim for the insurance money under the policy, and brought suit at law to enforce such claim. The company paid neither of the claimants and filed its bill of inter-pleader in this cause.—Held, that the complainant had a right to pay any one of the persons named in the facility of payment clause up to the time that suit was brought by the person entitled to payment under the contract, namely, the administrator of the insured, and that such payment would have been a complete defence to the administrator’s action; but, not having made such payment, the right of the administrator under the contract upon suit brought was complete, and a plea by the company of subsequent payment to one of the class mentioned would not operate to bar the administrator’s suit.
    On final hearing on bill, answers, and answer in the nature of a cross-bill.

      Mr. Edward D. Bwffield, for the complainant.

      Mr. G. Bore Cogswell, for the defendant James Godfrey, administrator.

      Mr. William B. Knight and French & Bicharás, for the defendant Mary Orr.
   Walker, Y. C.

The bill is one of interpleader and alleges that on April 5th, 1897, the complainant, by its certain policy in writing, insured the life of Abbie Hovis, of Camden, in. the sum of $285, which policy provided that the sum named should become payable upto the executors, administrators or assigns of the person insured, unless settlement should be made under the provisions of article 2 thereof within twenty-four hours after acceptance at the complainant’s home office in Newark of satisfactory proof of the death of the insured during the continuance of the policy; that in the second clause of the policy it was provided under the title of “facility of payment,” that the complainant might pay the benefits provided in the policy to any relative by blood or connection by marriage of the insured or to any other person appearing to the complainant to be equitably entitled to the same by reason of having incurred expense in any way on behalf of the insured for his or her burial or for any other purpose, and the production by the complainant of a receipt signed .by any or either of said persons or of other sufficient proof of such payment to any or either of them should be conclusive evidence that such benefits had been paid to the person or persons entitled thereto and that all claims under the policy had been fully satisfied.

The bill, after alleging the rival claims of the defendants, concludes with the usual averments that the complainant has been unable to determine to whom of right the sum mentioned in the policy belongs, and that it has always been willing to pay the sum due to such person or persons as should be lawfully entitled to receive the same and to whom it can pay with safety, and it does not in any respect collude with either of the. defendants touching these matters, and that it has not been indemnified by either of them, but brings the suit of its own free will and to avoid being molested and injured in the premises.

The defendant Mary Orr answered and set up that she is the equitable assignee and owner of the policy, being the person who effected the insurance, paid the premiums thereon, and is the half-sister and nearest blood relation of the insured, and is equitably entitled to the money to be paid under the policy.

The defendant James Godfrey, administrator of the insured, answered, and by way of cross-bill exhibited against the defendant Mary Orr, set up that as administrator he was entitled to •receive the amount due upon the policy in accordance with the terms thereof, and to the answer in the nature of a cross-bill the defendant Mary Orr put in an answer instead of a special replication, but no objection was made to the form of the pleading.

It ought to be stated that the defendant. Godfrey set up that Mrs. Orr was neither a relative of his wife, the insured, nor did she pay the premiums on the policy with her own money.

The following facts were clearly proved upon the hearing: The insured died May 14th, 1907. The next day the defendant Mary Orr, who was a half-sister, furnished proofs of death and made claim for the sum insured, having herself taken out the policy on her half-sister’s life, which policy she always had in her possession, and paid the premiums upon it with her money, and surrendered the policy and receipt book to the company. The insured, between the time of the taking out of the policy and her death, had married the defendant James Godfrey, who became her administrator. Two days after the death of the insured her husband was granted administration upon her estate by the surrogate of Camden, and on May 23d, 1907, he furnished proofs of death to the complainant, and made a claim for the insurance money under the policy. The complainant having paid neither Mrs. Orr nor the administrator, the latter, on June 27th, 1907, commenced suit against the complainant, who was on that day served with summons in the action. The proofs of death sent in by Mrs. Orr were made out by John Dolton, assistant superintendent of the complainant company, in the presence of Mr. Godfrey, who made no objection. The claim put in by Mrs. Orr was marked paid, but was not in fact paid. The assistant superintendent testified that the word so marked indicated that the company had accepted Mrs. Orr’s claim. On May 17th, 1907, the home office telegraphed the Camden superintendent to pay the claim, not saying to whom, and Mrs. Orr was notified by the manager that her claim was approved and should be received by her promptly. At that time the defendant Godfrey had made claim, not formally it is true, but had notified the Camden superintendent, who, upon receipt of the telegram, called upon the claimants and tried to get them to agree concerning the matter of payment, but was unable so to do.

It is to be noticed that no beneficiary was named in the policy under consideration. The contract was to pay within twenty-four hours after acceptance of satisfactory proof of death, unto the executors, administrators or assigns of the insured, the amount named in the policy, unless settlement should be made under the provisions of article 2.

The “facility of payment” clause is one under which the company may, but is not obliged to, make payment to anyone of the class of persons named. It is true that the defendant Mrs. Orr took out the policy and paid all the premiums thereon. She is therefore a person who “incurred expense * * * on behalf of the insured” and to whom the company might, but did not have to, pay the benefits provided in the policy. By the policy the complainant “agreed to pay * * * unto the executors, administrators or assigns of” Abbie Hovis (Godfrey) the insurance money “unless settlement shall be made under the provisions of article 2.”

A policy somewhat similar to the one under consideration was before the supreme court in Broohs v. Metropolitan Life Insurance Co.j 70 N. J. Law (II Vr.) 36. In the Broolcs Case a beneficiary was named in the policy which also contained a condition that the company might pay the policy to either an executor or administrator, husband or wife, or relative by blood, or lawful beneficiary of the insured, and that a receipt in full, signed by either of them, should be conclusive evidence that payment had been made to the person lawfully entitled and that all claims upon the company under the policy had been fully satisfied. It was held that upon the death of the insured leaving a lawful beneficiary the contract would be treated as an appointment of the persons named, any one of whom was authorized to receive payment from the company, and it followed that the company might make payment to any one of the persons so appointed as it might elect, bnt that whether a plea of payment to a person of the class would be a bar to the action where it appeared that the payment had been made after the suit was begun,was not decided, nor has it since been decided in this state. That question is directly involved in this suit and must now be determined.

In Lewis v. Metropolitan Life Insurance Co., 178 Mass. 52, suit was brought by the son of the person to Whom a policy of life insurance had been issued. He had supported her for several years before her death and had paid her funeral expenses, and notified the company almost immediately of her death and was furnished blanks by them, on which the proofs of death were made. He paid the premiums upon the policy. The supreme court of Massachusetts held (at p. 54) that the plaintiff had no rights under the policy sued on. No- one was named as beneficiary in the policy and it contained a facility of payment clause. The court said that that clause does not entitle one to whom payment might have been made, but who- is not named as the beneficiary in the policy or otherwise designated as the person who is to receive the sum to be paid, to enforce payment of the sum due under it, and that such suit can be maintained only by the executor or administrator of the insured, with whom the contract was made, nor did the fact that he paid the premiums, between the time of the issuance of the policy and the death of "the insured, give a right to sue for the amount to be paid, the premiums paid under the policy being in legal contemplation paid by the insured.

In Prudential Insurance Co. v. Young, 43 N. E. Rep. 253, where an industrial insurance policy was sued upon, which contained a facility of payment clause and did not designate a beneficiary in whom the right to benefits under the policy vested, the court said that- no right vested in the persons referred to in the clause, if for no other reason than that their right depended upon the willingness of the company to- recognize them, which it was not bound to do, and that it was plain that the beneficiary designated was the insured’s estate.

In Golden v. Metropolitan Life Insurance Co., 35 N. Y. App. Div. 569, suit was brought by the person named as beneficiary in two policies of insurance, and as the company had not paid the amount of the insurance to any of the persons named in the clause providing for the facility of payment, it was held that the plaintiff was entitled to recover.

In Wokal v. Belsky, 53 N. Y. App. Div. 167, suit was brought by the administrator of a decedent against a life insurance company and an adverse claimant under a policy of insurance containing a facility of payment clause. The court held (at p. 170) that such a clause is for the protection of the company tó enable it to discharge its obligation by payment to any one of the class designated without requiring administration, and that the only effect of the clause is to provide the company with a defence in case it has paid thereunder, and that it neither grants nor tabes away from any person a cause of action.

In Thompson v. Prudential Life Insurance Co., 119 N. Y. App. Div. 666, the court held (at p. 669) that it seemed that if payment had been made by defendant, prior to notice of the plaintiff’s claim as administratrix, to a person chosen from one of the classes designated in provision 2 (a facility of payment clause), in the due exercise of the discretionary power of selection reserved to it by that provision, that fact would be a complete defence to the action, and (at p. 670) that under the terms of the policy the plaintiff, as administratrix, could recover only in the event that the defendant had not paid the insurance to some person in pursuance of the facility of payment clause.

My judgment is that the complainant had a right to pay any one of the persons named in the facility of payment clause in the policy under consideration, up to the time that suit was brought by the person entitled to payment under the contract, namely, the administrator of the insured; and that such payment would be a complete defence to the administrator’s action; but, not having made such payment, the right of the administrator under the contract, upon suit brought, was complete, and that a plea by the company of subsequent payment to one of the class mentioned, would not operate to bar the administrator’s suit.

This view, as I understand it, does not conflict with the decision in Metropolitan Life Insurance Co. v. Schaffer, 50 N. J. Law (21 Vr.) 72. In that case it was held that the production by the insurance company of the policy and the premium receipt book and the receipt of a daughter of the insured, constituted a complete defence against a claim of the beneficiary named in the application for the policy, a condition of the policy being that payment might be made to the beneficiary or an executor or administrator, husband or wife, or relation by blood or connection by marriage. While the plaintiff was named as beneficiary in the application, there was no contract in the policy to pay such beneficiary, the contract being to pay the person or persons named in condition 5 of the policy, just recited. Furthermore, it would appear, though it is not stated, that the suit, which was brought by the plaintiff named in the application, was brought after payment made to the daughter, who was one of the class to whom payment might be made. This must certainly be true; that is, payment must have been made before suit brought, for this case of Metropolitan Life Insurance Co. v. Schaffer was cited and referred to in Brooks v. Metropolitan Life Insurance Co., ubi supra, in which last case it was held that the question of timely payment was left undecided.

The complainant had a right to file its bill of interpleader in this cause, because the question arising upon the adverse claims of the defendant had not been adjudicated in this state, but, on the contrary, had been left expressly undecided in a case in the supreme court, in which it was mooted, and the complainant was therefore embarrassed by hostile claims, and could not with safety pay either of the claimants.

As the whole controversy between the parties was submitted upon the hearing, namely, the right of the complainant to bring interpleader, and the right of the defendants to the fund, as against each other, there will be a decree that the complainant pay the moneys into court, out of which it will be entitled to its taxed costs and a reasonable allowance for counsel fee, which fee will be fixed upon notice to the defendant Godfrey, administrator, to whom the balance of the fund will be directed to be paid.


source: Caselaw Access Project

author: Walker, V. C.'

license: Public Domain

text:
    Erasmus Freeman v. Island Heights Hotel and Improvement Company.
    [Decided March 26th, 1909.]
    1. A conveyance of lots according to a map upon • which a “camp ground” is laid out implies a covenant on the part of the grantor that such ground is to be used in the manner indicated.
    2. One who buys lots according to a map upon which a “camp ground” is laid out may enforce the implied covenant that such ground is to be used in the manner indicated, though the lots are part of premises formerly laid out and dedicated as an avenue.
    On final hearing on bill, answer, replication and proofs.

      Messrs. Grey & Archer, for the complainant.

      Mr. Wilfred B. Wolcott and Mr. Isaac W. Carmichael, for the defendant.
   Walker, V. C.'

The bill prays that it may be decreed that the portion of the lands at Island Heights in this state, called “Camp Ground,” the title to which is in the defendant company, shall remain open and devoted to the purposes for which it was originally dedicated, and, incidentally, that the defendant may be forever enjoined from erecting any fence or other structure upon the premises inconsistent with the user of the same as a “camp ground.”

On June 1st, 1878, sundry persons associated themselves into a corporation under the name of “Island Heights Association” under the provisions of an act entitled “An act to encourage the improvement of real property in this state,” approved March 24th, 1874. On July 1st, 1878, the association purchased about one hundred and sixty-eight acres at Island Heights, New Jersey, and obtained conveyances therefor. Afterwards it purchased another tract, and the whole was laid out and a map made of it labeled:

“Property of the Island Heights Association, on the North Bank of Toms River, in Ocean County, New Jersey, scale 100 feet to an inch. A. P. Irons, Surveyor, Toms River, New Jersey, 1878.”

Copies of this map were spread broadcast, and sales were made of lots with reference to that map. The operation was one of at least a semi-religious character and was projected by the denomination known as Methodists and was intended as a Methodist camp meeting resort. The map appears not to have been filed.

In 1881 another map was made by the association and labeled: “Map of Island Heights, Ocean County, New Jersey.” On both these maps a portion of the land of the association was marked “Auditorium,” and an auditorium building was erected there some time during the early 80’s and was removed in 1904 or 1905. On Sunday, August 13th, 1878, the first “camp meeting” was held upon the grounds, and it was announced in the sermon that the place would always be devoted to camp meeting services. This announcement was frequently repeated at services and on other occasions.

The complainant is the owner of two lots on the tract in question and derives his title mediately from the association, one lot having been conveyed by the association to Alexander C. Graw, September 30th, 1886, who conveyed the same to Jacob Graw, October 7th, 1886, who conveyed the same to the complainant May 19th, 1890, and the other having been conveyed by the association to James L. Hayes, July 31st, 1886, who conveyed the same to the complainant September 17th, 1887. Before complainant made his first purchase in 1887 he spent the summer at Island Heights and heard announcement made from the pulpit in the auditorium that the open space there (at the auditorium) was to be a “camp ground.” The ground remained open ’and no attempt was ever made to enclose it until the summer of 1907. In 1886 a revised map was made which was filed in 1888. Its lines were in many particulars a considerable departure from those in the map of 1881, but this last map also showed the “camp meeting” or auditorium space, though contracted somewhat from its former dimensions. The complainant saw the revised map before making his purchases, and heard statements made by members of the association to the effect that the camp ground was to be kept open.

The conveyances from the association to the complainant’s predecessors in title contained covenants by the parties of the second part for themselves and their heirs and assigns, that the grants were made and received subject to the rules, by-laws and regulations which might, from time to time, be adopted by the association for the protection, government and control of the camp meetings and other assemblies to be holden within their premises from year to year. The properties came to the complainant subject to these conditions. There was abundant testimony to show that the “camp ground” in its original, and after-wards in its more restricted area, had remained open, unenclosed and unobstructed, except by the auditorium building and a summer house and well which was made upon the premises, and it was free to the use of all persons for outing purposes when not being devoted to religious meetings. Religious services appear to have been discontinued on the “camp ground” in or about the year 1900, and on March 25th, 1901, the land comprising the “camp ground” was conveyed to Ralph B. Gowdy, and on the same day Mr. Gowdy and his wife conveyed a one-half interest in the premises to Louis F. Bodine, and on November 4th, 1903, Messrs. Gowdy and Bodine, together with their wives, conveyed the same premises to the defendant, the Island Heights Hotel and Improvement Company.

The complainant, who has built a cottage upon his lands, relies upon an implied covenant that the “camp ground” or premises, the fee of which is now in the defendant, shall be used only for “camp meeting” purposes, and that it cannot be closed to him as a lot owner upon the association’s tract, or his view through and across the same obstructed.

The nature and character of this covenant was under consideration by Vice-Chancellor Stevens in Forrester and others (among whom was the complainant in this cause) v. Island Heights Association and others (among whom was the defendant in this cause), 62 Atl. Rep. 775, and it was held on demurrer, that whatever private interests existed in the "camp ground” laid out, mapped and dedicated in the manner set forth in the complainant’s bill in that cause, it was unnecessarj'' to define, for whatever rights might be held adversely to the defendants as owners of the fee, the complainant would not be entitled to relief until the defendant threatened to interfere with those rights, a mere transfer of the fee not being an invasion of any of the complainant’s rights. Such interference is now alleged and is made the basis of the present suit.

The vice-chancellor took occasion to remark in the Forrester Case, at p. 777:

"The maps upon which the ‘camp ground’ is laid out have been recorded, and all the facts connected with the dedication of the ‘camp ground’ and the creation of all public and private rights therein appear to be matters of public notoriety and largely matters of record.”

In Lennig v. Ocean City Association, 41 N. J. Eq. (14 Stew.) 606, the defendant, a religious camp meeting association, laid out and mapped its seaside property into lots reserving a tier of blocks between Fifth and Sixth streets and extending from the ocean westward, as a “camp ground” for religious services and tenting purposes, and sold to the complainant lots by that map fronting on the blocks so reserved, whereon he erected a summer residence. It was observed by Mr. Justice Dixon, speaking for the court of errors and appeals, at p. 608:

“Whenever the owner of a tract of land lays it out into blocks and lots upon a map, and on that map designates certain portions of the land to be used as streets, parks, squares or in other modes of a general nature calculated to give additional value to the lots delineated thereon, and then conveys those lots by reference to the map, he becomes bound to the grantees not to use the portions so devoted to the common advantage otherwise than in the manner indicated.”

And, again, at p. 609:

“The inquiry now presented therefore must be, not whether the association has dedicated the blocks between Fifth and Sixth streets to public use, but whether it has entered into an implied covenant with the complainant not to use those blocks in the mode now proposed, and has granted to him, as appurtenant to his lots, the benefits to be derived from such restriction. The circumstances lead us to answer this inquiry in the affirmative.”

Bridgewater v. Ocean City Railroad Co., 62 N. J. Eq. (17 Dick.) 276, is a case like the one under consideration. In the Bridgewater Case the complainant was the owner of two lots by purchase through an intermediate grantee of the Ocean City Association. There was a dwelling-house on the lots in which he resided with his family. The bill was filed against the railroad company, a subsequent grantee of the association of a strip of land part of a certain tract which, by an implied covenant with the complainant and other purchasers of lots, had been devoted to use as a camp ground and park. The defendant was erecting a passenger station thereon in violation of the covenant to the injury of the complainant, by destroying the attractiveness of the camp meeting ground and making it less desirable as a place of recreation and religious instruction, interfering with the circulation of air and with the view of the park and camp ground. Said Vice-Chancellor Van Fleet, at p. 289:

“The space between Fifth and Sixth streets was to be kept open for use as a camp ground and park for religious services, affording a place where large congregations could be assembled in the open air, and protected in tents or temporary structures, with abundant access of light, air and view. Lots, whether near to or remote from the camp ground, were purchased in the expectation that this space should be devoted to the declared use. All purchasers thus acquired a right to have that space used as they had been assured it would be used, for no other than the named purposes. The implied covenant arises for the benefit of all the lots, without regard to their particular locality, in relation to the tract impliedly agreed to be specially kept as an open space.”

The defendant contends that even if the facts warrant the conclusion that an implied covenant to keep the camp ground open and to be used only for purposes of recreation and religious exercises exists, nevertheless, the complainant cannot have the advantage of it because his lots lie partly within the territory which was designated as a boulevard on the original map. In 1886 a considerable departure was made in the original plan of lots, .and what is called a dividend sale of lots remaining in the association was made to stockholders. As already remarked, a map was made in 1886, but not filed until 1888. This map showed lots platted on the boulevard. This is the map which the complainant saw and is the map with reference to which his predecessors in title, who were stockholders, bought at the dividend sale. If the original owner changed the scheme of avenues upon the premises in question and sold lots upon a portion of the premises formerly laid out and dedicated as an avenue, still reserving the camp ground as such and sold to purchasers lots upon the abandoned avenue, with an implied covenant that the camp ground should remain open and devoted to no other than its original purpose, I fail to see how that fact would give the association, or its subsequent grantee, mediate or immediate, the right to violate that implied covenant as against the owner or owners of such lots. Defendant’s counsel has cited no authority for his contention in this regard. He relies upon DeGray v. Monmouth Beach Club House, 50 N. J. Eq. (5 Dick.) 329, 351; Roberts v. Scull, 58 N. J. Eq. (13 Dick.) 405; Ocean City v. Headley, 62 N. J. Eq. (17 Dick.) 338.

These are cases in which it is held that one who himself violates a covenant is without standing to enforce that covenant. They have no application to the case at bar. If the complainant in this ease were violating the covenant for keeping the camp ground open, he probably would have no standing to object to the defendant’s closing it, but he is doing nothing of the kind. In my judgment, the defendant may not be heard to say that because it sold to the complainant land upon an avenue which had been laid out and dedicated to the public, and because the complainant purchased it, the defendant has a right to close against the complainant the camp ground which was forever dedicated as an open space for purposes of recreation and religions exercises.

Upon the whole case, I am of opinion that the complainant is entitled to the relief he seeks, and it will be decreed accordingly', with costs.


author: Walker, V. C.

text:
    Andrew Volker v. Fannie N. Fisk and Nicholas Fornarotto.
    [Decided April 6th, 1909.]
    1. A real estate agent is not entitled to commissions on an invalid sale.
    2. A vendor of land, who has been compelled by a decree avoiding the sale to repay the commissions paid directly to his agent by the purchaser as a part of the consideration, can recover them from the agent; the payment being compulsory and not voluntary.
    3. One who has been compelled to pay money on a liability from which a third person ought to have relieved him by paying the amount can recover it from the latter in assumpsit; a request for repayment being implied.
    4. A vendor of land, who has been compelled by a decree avoiding the sale to repay the commissions paid directly to his agent by the purchaser as a part of the consideration, being entitled to recover them from the agent in assumpsit, is not entitled to relief in equity by subrogation to tbe rights which the purchaser had, but did not urge against the agent.
    Heard on demurrer to bill.

      Mr. Frank Benjamin, for the complainant.

      Messrs. Lambert & Stewart, for the defendant Fannie N. Fisk.
   Walker, V. C.

The bill alleges that the complainant, being the owner of certain real estate, entered into an oral agreement with the defendant Mrs. Fisk, to sell the same for $5,700 or any greater sum, and- that she should retain for her own use all purchase-money in excess of that sum; that she procured the defendant Fornarotto to purchase the premises for $6,000, and that he paid and secured the consideration money and gave his note for $300 to . her for1 her commissions, and paid the note to her at maturity; that subsequently, and after payment of the note, tire defendant Fornarotto repudiated the sale on the ground of infancy and brought suit in this court against the present complainant for rescission of the contract, which was decreed, the deed declared void, and the complainant was compelled to repay to Fornarotto the purchase price of $6,000, which included the $300 paid by him directly to Mrs. Fisk. The prayer is that the agreement between the complainant and defendant Mrs. Fisk may be decreed to be void and that he may be subrogated to the rights Fornarotto had to recover the said sum. of $300 from her, and that she be decreed to pay it to him, Yolker. The defendant Fornarotto filed a disclaimer, and is not represented.

The defendant Mrs. Fisk demurred to the bill for want of equity generally, and specifically because the complainant asks for a decree for the repayment of a liquidated sum of money, which demand, it is alleged, is cognizable in a court of law.

As already seen, the entire consideration passing from Fornarotto to the complainant was $6,000, which included the commissions of $300 paid directly to the defendant Mrs. Fisk by the defendant Fornarotto, and this entire sum the complainant was obliged to pay back to Fornarotto under the decree of this court, which avoided the sale. The defendant Mrs. Fisk was the complainant’s agent and cannot stand in any better position toward the purchaser, Fornarotto, than her principal, for whom she negotiated the sale. Her commissions could have been earned only upon negotiating a valid, not an invalid, sale.

In Courter v. Lydecker, 71 N. J. Law (42 Vr.) 1511, it was held that the condition upon which a broker earns a commission is that he shall obtain a sale. That, of course, means a valid sale. .In this case it is as though no sale had been made, and the transaction must be so treated. An invalid sale is practically no sale. This being so, Mrs. Fisk never earned a commission. It was as a fact paid to ber on a sale which, was afterwards avoided, and she cannot retain an advantage resulting from her unavailing effort.

Wood v. Sheldon, 42 N. J. Law (13 Vr.) J$l, is a pointed authority to the effect that sales made through brokers, which are avoided because of some element of illegality, are cases in which the purchase-money can b.e recovered because of failure of consideration.

The complainant has been obliged to repay to the defendant Fornarotto these commissions, which were included in the consideration moving to him upon the sale, and therefore the payment was not voluntary, but compulsory. Hence, the complainant is entitled to a recovery of the amount of the commissions from Mrs. Fisk, and the remaining question is, is he entitled to this recovery in this court or must he be relegated to a court of law.

According to the terms of the contract the payment of the commissions was made directly from the defendant Fornarotto to the defendant Mrs. Fisk, who was the agent of the complainant in this cause. The defendant Fornarotto had the right to pursue Mrs. Fisk for the commissions he paid her on the avoided sale. He chose not to do so, but to recover them from the complainant as part of the consideration paid. That Mrs. Fisk was not a party to the suit between Fornarotto and the complainant for the rescission of the sale malms no difference. If she had been a party to the suit between the principals she could have been decreed to repay to Fornarotto in that suit the $300 which she received, and any defence she might have had in that suit would be available to her in this suit. There was no decree for or against her there, and there is no record that binds either party here.

In Shinn v. Budd, 14 N. J. Eq. (1 McCart.) 234, Chancellor Green held that where a person is compelled to pay the debt of a third party to protect his own rights, a court of equity substitutes him in the place of a creditor as a matter of course, without any agreement to that effect. Now, as the complainant was compelled by the decree of this court to repay to Fornarotto the $300 he paid to Mrs. Fisk, as commissions upon the avoided sale, the complainant would be entitled to be subrogated to the rights which Fornarotto had, but did not urge, against Mrs. Fisk, if the complainant could not sue Mrs. Fisk at law for want of a contract express or implied between them, as to the payment by her to him of the commissions she received from Fornarotto. But it is clear to me that the complainant has a perfect cause for action in a court of law against Mrs. Fisk to recover the money in the equitable action of assumpsit for money paid, upon an implied contract.

Mr. Chitty says the count for money paid is supported if the payment, were made at the express or implied request of the defendant, and that it is clear that if money be paid by a person in consequence of a legal liability to which he is subject, but from which a third person ought to have relieved him by paying the amount, a request will be implied. 1 Chit. Pl. 351.

Surely the complainant was under a legal liability to pay Fornarotto the $300 and that liability was cast upon him by the decree of this court. Just as surely Mrs. Fisk ought to have relieved him from the burden by paying tire amount herself. Eryo, the law implies that the complainant has made the payment at the request of Mrs. Fisk, and therefore he can recover the amount from her in assumpsit.

Chancellor Walworth speaking for the court of errors of New York, in Hunt v. Amidon, 4 Hill 345, remarked that courts of law long since fell in love with a part of the jurisdiction of the court of chancery, and substituted the equitable remedy of an action of' assumpsit ripon the common money counts for tiie more dilatory proceeding by bill in equity in certain cases.

There is no need of subrogation to enable the complainant to recover. Iiis claim is not grounded upon fraud nor does it involve any other principle of equity jurisprudence, and, because he has an adequate remedy at law, the demurrer must be sustained. The defendant is entitled to costs.


text:
    The Chancellor of the State of New Jersey and Barbara Goetz v. Edward B. Seiberlich et al.
    [Decided April 21st, 1909.]
    On May 12th, 1S82, J. R. executed and delivered to the chancellor of New Jersey a mortgage on certain real estate to secure the payment of a trust fund deposited in the court of chancery. Five days afterwards J. R. conveyed the mortgaged premises to F. M., and in the deed therefor it was recited that the property was conveyed subject to the chancellor’s mortgage, the payment whereof was thereby assumed by F. M. He died in 1S95, having devised the premises to his wife, W. M. . On February 12th, 1890, F. M. and wife mortgaged the same premises to P. S., which mortgage was on March 17th, 1904, assigned to the defendant, E. B. S.. who foreclosed the same and purchased the property at the sheriff’s sale. E. B. S. took possession under the sheriff’s deed, thus dispossessing W. M., and has continued in possession ever since. From the acquisition of the premises by F. M. in 1882 until his death in 1895, and after that until his widow, W. M., was dispossessed under the foreclosure sale of the second mortgage in 1904, B. G., the life tenant of the trust fund invested in the chancellor’s mortgage, resided with them upon the mortgaged premises as one of their family, and they frequently (within twenty years before the commencement of this suit) promised they would pay her the interest on the chancellor’s mortgage. In 1904 an insurance policy upon the premises, the loss under which was payable to the chancellor as mortgagee, was canceled and a new policy obtained by W. M., the then owner of the equity of redemption, and delivered to the chancellor with similar mortgagee clause endorsed upon it, as collateral security for his mortgage. Nothing has been paid on account of the chancellor’s mortgage cither for principal or interest; and the defendant E. B. S. pleads the statute of limitations.—Held, that the facts and circumstances above detailed' are pertinent equities sufficient to rebut the presumption of payment of the mortgage by lapse of time, and that, therefore, the statute of limitations does not apply, especially in view of the fact that the defendant E. B. S., the assignee of the second mortgage and purchaser at the sale under its foreclosure, had notice of the existence of the chancellor’s mortgage from its record, from the recital of it in the deed for the premises from J. R., the mortgagor, to F. M., whose successor in title E. B. S. became, and from information imparted verbally to P. S., the assignor of E. B. S., by the attorney of the W. M. while the latter was the owner of the equity of redemption. Blue v. Bvcrctt. 56 N. J. Bq. (11 Diei.) Irf5, distinguished.

      On final hearing on pleadings and proofs.

      Mr. William S. Darnell, for the complainants.

      Mr. Edward Dudley and Mr. William D. Lippincott, for the defendant Edward B. Seiberlich.
    ■ Mr. Samuel D. Bergen, for the defendants Barbara Moore and others.
   Walker, Y. C.

On a sale of mortgaged premises under foreclosure the sum of $5,392.70 was paid into this court as surplus money. The premises upon the foreclosure sale were conveyed to Jacob Rettberg by the sheriff of Camden county on April 23d, 1881. The surplus money was, by the chancellor, loaned to Jacob Rettberg, who, together with his wife, on May 12th, 1882, executed and delivered to the chancellor a mortgage on the very same premises to secure its pajment, and, on the same day the mortgage was acknowledged and recorded in full in the office of the register of deeds of the county of Camden, there being embodied in it a recital of the order of this court under which the money was loaned. Five days later Rettberg and wife conveyed the mortgaged premises to Frank Mester, and in the deed therefor it was recited that the property was conveyed subject to the chancellor’s mortgage, the payment whereof Mester thereby assumed.

On February 12th, 1890, Mester and wife made a mortgage upon the premises to Peter Schemm for $8,000, and on March 2d, 1895, Mester died seized of the property, having devised the same to his wife, Wilhemina Mester. On March 17th, 1904, the Schemm mortgage was assigned to the defendant Edward B. Seiberlich, who foreclosed the same and purchased the property on the sale, and it was, on September 1st, 1904, conveyed to him by the sheriff of Camden county. The chancellor was not a party to that suit. Seiberlich took possession of the premises under his deed, thus dispossessing Mrs. Mester, and he has continued in possession ever since.

Seiberlich’s defence is that the statute of limitations has operated to defeat the chancellor’s mortgage, no principal or interest whatever having been paid on account of it; and further, that in the event of the mortgage being held valid, that he, Seiberlich, is entitled to a lien upon the property for the sum of $1,598.94, the amount paid to the city of Camden to discharge its lien for taxes, &e., which were held, in the foreclosure of Seiberlich v. Mester, to be a lien upon the premises prior to the mortgage which he foreclosed in that suit.

Prior to the sale under the original foreclosure which produced the surplus money, the mortgaged premises were owned by George Goetz, who died seized thereof in 1875, and by his will he devised a life estate therein to his wife and provided that at her death the premises should be divided among his legal heirs. lie left him surviving his widow, Barbara Goetz, a brother, Frederick Goetz, and two sisters, Eosa Minni and Barbara Moore. Eosa Minni died a widow, intestate, and without issue. Frederick Goetz died intestate, leaving him surviving Eegina Goetz, his widow, Eugene Goetz, Fritz Goetz, August Goetz and Eosa Goetz, his children. Barbara Moore, the surviving sister, and the children of Frederick Goetz, the deceased brother of George Goetz, the original owner, are now entitled to the beneficial interest in the chancellor’s mortgage, the life estate of his widow, Barbara Goetz, who is one of the complainants, having been extinguished by her death pending this suit.

The fact is that no interest and no part of the principal was ever paid upon the chancellor’s mortgage. The practice that formerly prevailed with reference to these mortgages was for the mortgagor to pay the interest directly to the beneficial owners of the fund, thus saving clerk’s commissions and delay in the payment of the interest. That practice, for prudence sake, has been abandoned and interest due on money loaned by the chancellor is now paid to the clerk and by him disbursed.

The surplus money was loaned to Eettberg upon the petition of Barbara Goetz, who had a life interest in the fund.

With the exception of the five days succeeding the making of the chancellor’s mortgage until the foreclosure of the Schemm mortgage, Barbara Goetz and Frank Mester and Wilhemina, his wife, lived together as one family on the mortgaged premises.

The first question presented for solution is whether or not the statute of limitations has operated to defeat the chancellor’s mortgage.

The mortgage under whose foreclosure Seiberlich became the owner of the fee in the premises was made subsequent to that of the chancellor, and in the deed from Rettberg to Mester (the maker of the mortgage last referred to) was a recital that the conveyance was subject to the pajunent of the mortgage made to the chancellor. The deed was recorded long before the Schemm mortgage was made and executed, and therefore Seiberlich, both as assignee of that mortgage and as the purchaser of the mortgaged premises at the subsequent sale, had constructive, which is equivalent to actual, notice of the existence of the chancellor’s mortgage. Kellogg v. Randolph, 71 N. J. Eq. (1 Buch.) 127, 128.

In Blue v. Everett, 56 N. J. Eq. (11 Dick.) 455, it was held that when the legal right of action upon a bond is barred by the statute of limitations, and the legal right of entry upon lands mortgaged to secure the bond is likewise barred, the holder of the bond and mortgage cannot maintain a bill in chancery to collect the debt by sale of the mortgaged premises, unless he can show some pertinent equitable right beyond the ownership of the bond and mortgage. In this case Mr. Justice Dixon, speaking for the court of errors and appeals (at p. 458), said: “The debt is a mere legal entity, involving no obligation outside of its legal character, and having intrinsically no quality of which a court of equity can take cognizance. It would seem, therefore, that when, because of such a debt as the principal thing, a court of equity is called upon to give equitable effect to that which is only incidental thereto, the first inquiry should be, does the principal exist? Is there any legal obligation? And when for any cause the answer is found to be in the negative, the court should refuse to act.” Ergo, if the answer is found to be in the affirmative the court should act.

In Colton v. Depew, 60 N. J. Eq. (15 Dick.) 454, the court of errors and appeals reviewed and explained the case of Blue v. Everett, supra, and Mr. Justice Depue, speaking for the court (at p. 463), observed: “The mortgagee has two securities for the debt—the bond and the legal estate in the mortgaged premises. * * * The possession upon which the statute attaches must be adverse. * * * The doctrine of the law with respect to title under the statute of limitations is that there has been a possession adverse to the owner of the legal title for twenty years. Whether possession is adverse within the purview of the statute is a question of fact, to be determined upon competent evidence concerning the character of the possession, whether permissive or hostile to the title of the real owner. A person may be in possession of property for a period longer than ■that mentioned in the statute, without paying rent or making any compensation for his occupation of the premises, and not be within the statute of limitations. Possession, to make the statute available, must be adverse for the full period prescribed by the statute.”

Between mortgagor and mortgagee the latter has an estate in the lands of the former. Wade v. Miller, 32 N. J. Law (3 Vr.) 296.

Both Blue v. Everell and Collon v. Depew were reviewed by Vice-Chancellor Pitney in Ely v. Wilson, 61 N. J. Eq. (16 Dick.) 94, and the learned vice-chancellor, speaking of the latter (at p. 107), said that the logical result of the decision in Colion v. Depew is that a mere acknowledgment of the existence of the debt by one not interested in the land pledged to its payment cannot be construed as an acknowledgment of the right of the mortgagee in the land. lUrgo, as I take it, an acknowledgment of the existence of the debt by one so interested is an acknowledgment of the right .of the mortgagee, and that, consequently, the holding of the owner of the equity of redemption making-such an acknowledgment is not a holding adverse to the interest of the mortgagee, and therefore not within the statute.

Stimis v. Stimis, 60 N. J. Eq. (15 Dick.) 313, was considered by Yice-Chancellor Grey to be a case in which an independent equity was raised in favor of the life of a mortgage against the consequence of non-action to enforce its payment, notwithstanding the mortgage might otherwise have been presumed satisfied by the application of the statute of limitations. That was a case in which no payment of either principal or interest had been made upon the mortgage for over twenty years, but it appeared that the mortgagor and owner of the equity of redemption was the sole surviving executor of the will of the deceased mortgagee and the only person who, during the period of defaults in making the payments which came due on the mortgage, could have taken steps to collect either the bond or mortgage, and (at p. 319) the learned vice-chancellor adverted to the fact that this very case of Stimis v. Stimis (as reported in 9 Dick. 17) was mentioned in Blue v. Everett as one of those in which an independent equity was raised in favor of the life of the mortgage against the consequence of non-payment.

To return to Blue v. Everett. In that case it was held, that although the right of entry upon mortgaged premises was barred by lapse of time, a bill to foreclose would lie if some pertinent equitable right beyond the ownership of the bond and mortgage was shown. Mr. Justice Dixon observed—56 N. J. Eq. (11 Dick.) (at p. 459)—that this court had with respect to debts secured by real estate mortgages generally ignored the statute of limitations, and had held that unless actual payment of the debt be shown it would apply presumptions of its own when there had been long delay in taking steps to collect the debt, and he went on to remark that had these presumptions been clearly established and long maintained, that might of itself be sufficient reason for declining to disturb them; but that an examination of the cases would show that they were not well defined,, citing Wanamaker v. VanBuskirk, 1 N. J. Eq. (Sax.) 685; Evans v. Huffman, 5 N. J. Eq. (1 Halst.) 354; Magee v. Bradley, 54 N. J. Eq. (9 Dick.) 326; Murphy v. Coates, 33 N. J. Eq. (6 Stew.) 424; Moore v. Clark, 40 N. J. Eq. (13 Stew.) 152; Miller v. Teeter, 53 N. J. Eq. (8 Dick.) 262; Rockhill v. Rockhill, 14 Atl. Rep. 760.

In Blue v. Everett the bill was filed over twenty years after the last payment of interest on the mortgage, and there was not one special equitable fact present which would prevent the running of the statute of limitations; but I do not understand that that case overruled the decisions in those last above mentioned, so far as they were based upon special equitable circumstances operating to take the obligations sued upon out from under tbe statute; at least, it seems to me, that the facts and circumstances which in them were held to be an acknowledgment of the existence of the obligations sued on and to prevent the presumption of payment, are still circumstances which may be taken into consideration, certainly so in connection with other facts, in determining whether or not the holding of a mortgagor in possession or those claiming, under him has been adverse to the title of the mortgagee.

Since the decision in Blue v. Everett and Colton v. Depew, the court of errors and appeals has expressly reaffirmed the doctrine- laid down by Chancellor Vroom in one of the cases, namely, Wanamaker v. VanBuskirk, 1 N. J. Eq. (Sax.) 685, by its affirmance of the decision of Vice-Chancellor Bergen for the reasons given by him in Ayres v. Ayres, 69 N. J. Eq. (3 Robb.) 343; S. C., 69 N. J. Eq. (3 Robb.) 842. The learned vice-chancellor said in Ayres v. Ayres (at p. 346) that the presumption of payment was overcome in Wanamaker v. VanBuskirk by the relationship of the parties and the fact that to have exacted payment would have brought distress upon a daughter and grandchildren who remained in possession and depended upon the mortgaged premises for support, and that the harshness of such a proceeding was held to make the indulgence and delay resulting therefrom reasonable.

Let us now look at the facts and circumstances presented in the case under consideration as showing the existence of the mortgage debt and as recognizing the equitable title of the mortgagee.

Frank Mester and his wife, Wilhemina, were in possession from the time he acquired .title in 1882 until his death in 1895, and she afterwards, as his devisee, until she was dispossessed by the sale to Seiberlich under the foreclosure of the Schemm mortgage in 1904. During all of this time Barbara Goetz, who was the life tenant of the trust fund invested in the mortgage to the chancellor, lived with Mr. and Mrs. Mester upon the mortgaged premises as one of their family, she not having died till 1905, and they promised her that they would pay her the interest on the mortgage. Mrs. Mester’s testimony was that they made that promise frequently, and she remembered one occasion particularly, in tlie summer of 1881 or 1889, when she went to Europe, she told Mr. Schemm that the chancellor’s mortgage was in existence and that his was a second mortgage. In 1904, while she was the owner of the property, the Franklin Fire Insurance Company, of Philadelphia, which had issued a perpetual policy upon the premises in question and the loss under which was made payable to the chancellor as mortgagee, canceled the risk, and Mrs. Mester called upon J. Willard Morgan, Esq., counsellor-at-law, in reference to it, and asked him to reinsure the promises and told him that the policy was held by the chancellor to insure his mortgage, and that when the new one was made out it was to be put in the place of it.

In 1889, while Mrs. Mester was owner in possession of the premises, she sent Mr. Darnell, her attorney, to Mr. Schemm on business concerning the title to the property, and Mr. Darnell informed Mr. Schemm that his, Schemm’s mortgage, was a second one, and that there was a prior mortgage existing upon the premises. Mr. Schemm referred Mr. Darnell to his, Schemm’s attorney, Mr. Weil (of Philadelphia), and Mr. Darnell made the same statement to Mr. Weil.

In 1904 Mrs. Mester called on Mr. Darnell, with Mrs. Goetz, the life tenant, and exhibited to him a subpoena in the foreclosure case of Seiberlieli v. Mester, and Mrs. Goetz was very much exercised and in tears and demanded from Mrs. Mester in the presence of Mr. Darnell, payment of her money on the chancellor’s mortgage, and Mrs. Mester replied that she would pay it, but was then unable to do so.

On June 3d, 1904, Mr. Morgan, representing Mrs. Mester, the owner of the equity of redemption, secured a policy of insurance from the Camden Fire Insurance Association upon the property in question to take the place of the perpetual policy of the Franklin company, which new policy contained a clause endorsed thereon that the loss, if any, was payable to the chancellor of New Jersey, mortgagee, as his interest might appear, and on June 6th, 1904, Mr. Morgan mailed the policy to the chancellor at Trenton, by whom it was received and filed in the clerk’s' office. Mr. Morgan acted for Mrs. Mester in the matter and had an interview with the chancellor and from- him received the Franklin company’s policy for cancellation.

Another thing: Mrs. Mester was the niece of Mrs. Goetz and was brought up by the latter and regarded by her as a daughter. As before remarked, they all lived together as one family. Mrs. Mester and her husband were unable to pay the interest to Mrs. Goetz. To have exacted payment would have been a hardship upon them. They lived together upon the mortgaged premises and enjoyed its possession. Their relationship and situation, if not sufficient of themselves, when coupled with the other facts and circumstances regarding the non-payment of the mortgage and the acknowledgment of its existence, all combine, in my judgment, to create a rebuttal of the presumption of payment arising from the efflux of time, and to show that the holding of the mortgagors in possession was not adverse to the title of the mortgagee.

These views lead to the conclusion that the chancellor is entitled to a decree of foreclosure and for the sale of the mortgaged premises, and it only remains to ascertain the amount due upon the bond. As before remarked, the debt secured by the mortgage is $5,392.70. Lawful interest on this amount from the date of the bond, May 12th, 1882, to the present time, is approximately $9,300, making a total sum of approximately $14,700, and the question remains shall there be a deduction from this amount and an allowance to the defendant Seiberlich for the sum paid by him to the city of Camden for .taxes under the decree in Seiberlich v. Mester.

The defendant Seiberlich claims that in the event of the establishment of the chancellor’s mortgage as a valid and subsisting lien upon the premises in question he should be subrogated to the rights of the city of Camden in the sum of $1,598.94, being the amount of taxes, interest and costs paid by him to that city upon the purchase of the premises under his foreclosure oE the Schemm mortgage. The city of Camden was a defendant to that suit and the taxes referred to were decreed to be a lien upon the mortgaged premises prior to the lien of the mortgage then being foreclosed.

The defendant Seiberlieh in his answer avers that he has a lien upon the premises for the taxes paid which he is advised and believes is prior to any and all other liens. There is no prayer for subrogation, nor any answer by way of cross-bill praying affirmative relief. However, as no objection was made to the form of the answer, the defendant, if entitled thereto, can have a decree for these taxes either on the pleadings as they stand or on an answer in the nature of a cross-bill yet to be filed by leave of the court. Fiacre v. Chapman, 32 N. J. Eq. (5 Stew.) 463, 466.

Prior to the act of April 1st, 1898 (P. L. 1898 p. 202), the public policy of this state did not permit of investments made by the chancellor of funds in his custody to be impaired or lost by the acts of other public agents through the imposition of taxes, assessments or other rates for public uses, and mortgages made to the chancellor were held to be prior liens and to be superior to taxes and other municipal impositions. Elizabeth v. Chancellor, 51 N. J. Law (22 Vr.) 414, 416. The act mentioned provided that all lands that may be or may have been mortgaged to any officer of this state and held in trust for the benefit of any person should be subject to taxation, and all taxes so assessed should be and remain a lien against such lands as in case of taxes against property of other persons. This act was upheld in Chancellor v. Elizabeth, 65 N. J. Law (36 Vr.) 479, and although repealed by act of April 8th, 1903 (P. L. 1903 pp. 436, 438), taxes are still a lien upon real estate prior to these mortgages, under the provisions of the General Tax act of April 8th, 1903. P. L. 1903 p. 394.

Neither the act of April 1st, 1898, nor that of April 8th, 1903, are retroactive. They provide for taxation in futuro. Now, the decree in Seiberlich v. Hester recited that the sum of $1,598.94-was due to the city of Camden upon its certificate of sale for taxes and that the lien of the city under its certificate was prior to the lien and encumbrance of the mortgage of the complainant in that cause. There was no averment or proof in that case or in this case showing the years for which the taxes were assessed, and, consequently, if any part of the sum was for taxes assessed prior to April 1st, 1898, there was no lien in the city for such part prior to the encumbrance of the chancellor’s mortgage, and, consequently, no right of subrogation to the city’s lien resides in Mr. Seiberlich as to such part of those taxes.

This whole question of taxes was but meagrely presented on the hearing. It is urged on behalf of the defendants, beneficiaries of the trust fund, that because the chancellor was not a-party to the suit of Seiberlich v. Master, in which the taxes were adjudged to be a lien upon the mortgaged premises, the defendant Seiberlich is obliged to prove in this case that those taxes were properly assessed, and became a lien upon the premises in question and were paid by his money. That question will not be decided at present, but the defendant Seiberlich will be given leave to amend his answer either by praying for subrogation to the lien of the city of Camden in respect to the taxes mentioned or by filing a further answer in the nature of a cross-bill, praying for affirmative relief, and the matter may be brought on for further hearing upon that issue.

There is nothing in the way of a decree for foreclosure and sale under the chancellor’s mortgage, and the question of taxes can be settled on a distribution of the proceeds of sale which will be ordered into court. Let interest be calculated at six per cent, on the complainant’s mortgage from its date and a decree will be entered accordingly.

Counsel asks for a fee in addition to costs. The only allowance by way of fee that can be made in the decree is that provided for by rule 224 of this court. Shreve v. Harvey, 74. N. J. Eq. (4 Buch.) 336. The amount provided in the rule is grossly disproportionate to the value of the services of counsel for the complainant in this important and litigated foreclosure, and an award commensurate with counsel’s services will be made out of the fund to be raised and paid into court on the sale of the mortgaged premises, the amount to be determined upon notice to the beneficiaries of the trust fund.


text:
    C. Edith Gould v. Timothy Hurley et al.
    [Decided May 12th, 1909.]
    1. Evidence, in a suit to avoid a deed, held to show it was signed and acknowledged as it purported to have been.
    2. There was a delivery of a deed where, a father having put property in his daughter’s name, she, at his request, executed a deed thereof to a third person, and gave it to the father, who sent it to the grantee’s attorney.
    3. A gift of lots by father to daughter is not proved by the testimony of the mother that, when the father got the daughter’s signature to a consent for a trolley line, he said it would benefit her lots, and testimony of her husband that the father once told him he had given the daughter some property, at the place where the lots were located, and on another occasion, when asking him to sign a deed, stated he had a splendid opportunity to dispose of the daughter’s property at such place, for her advantage.
    4. Evidence of oral admissions and declarations is to be received with great caution.
    5. The principle that a fraudulent conveyance is good inter partes cannot avail the grantee where she, at her grantor’s request, conveyed the lots to another, and the latter, who had in fact purchased only one lot, conveyed the others to -another person for the original grantor’s benefit.
    6. It cannot avail one, whose father put lots in her name as a cover, in seeking to avoid the deed she made thereof to another, at her father’s request, that a complete agreement of sale was not made between her father and her grantee; they, or the parties representing them, being content.
    On final hearing on pleadings and proofs.

      Mr. Buliff V. Lawrence, for the complainant.

      Mr. Levris Starr, for the defendants.
   Walker, V. C.

In his lifetime Frederick J. Anspach was the owner of eight certain lots in the borough of Spring Laké, New Jersey, and on May 9th, 1896, his wife joining him in the deed, he conveyed them to his daughter, C. Edith Gould, the complainant, for an expressed consideration of “one dollar and other valuable consideration.” She claims the lots as a gift from her father. She never had possession of them, nor of the deed for them. Upon the death of her father in 1905, his deed to her and a deed signed by her in blank as to a grantee, for the same premises, were found among his effects.

On May 2d, 1900, at her father’s request, she made a deed, her husband joining her, whereby the title to the premises was divested out of her and put in the defendant Timothy Hurley. The consideration recited in this deed is $650, Mr. Anspach having negotiated a sale of one of the lots for that amount to Hurley, $100 to be paid in cash and $550 to be secured by a mortgage on the lot to be conveyed to him.

Prior to the making of the deed to Mrs. Gould by her father, the latter had entered into negotiations with Hurley for the purchase by Hurley of the one lot and Hurley signed a memorandum in writing, obligating himself to make the purchase. On July 1st, 1901, the complainant’s father sent to Joseph Mc-Dermott, Esq., counsellor-at-law, who represented Hurley, two deeds, one for the eight lots made from the Goulds to Hurley, and one for seven of the -same lots to be made by Hurley and wife to Mr. Anspach’s brother James. The lot not included in the deed from Hurley and wife to James Anspach was the one for which Hurley had bargained. These- two deeds remained with Mr. McDermott until after the death of Frederick J. Anspach. The deed from Hurley and wife to James Anspach was drawn by Mr. F. J. Anspach himself and enclosed to Mr. McDermott, but was not executed by Hurley and wife because it was a deed of warranty, and Mr. McDermott was unwilling to allow Hurley to execute any but a bargain and sale deed with covenants against the grantor. The transaction was not closed' during the lifetime of F. J. Anspach because of unpaid taxes which were a lien against the lot to which Hurley was to take title. After the death of her father, and in 1907, Mrs. Gould paid $516 of taxes nn these premises. This was after she knew that Hurley claimed one of the lots and that the estate of her father claimed the beneficial ownership in the seven lots conveyed by Hurley to James Anspach after her father’s death. Hurley, it should be remarked, has had possession of his lot since he sigued the agreement to purchase, and has improved it. Of course, her father’s dealings with Hurley do not bind her, but they have a bearing upon the status of the other defendants, and are pertinent in that aspect.

Mrs. Oould claims that she never knowingly executed, and never acknowledged the deed from herself and husband to Timothy Hurley. She testified that she signed but one paper with reference to these lots, which was at the request of her father, and which she said was explained to her by him as a consent for the construction of a trolley line in front of the lots in question. Besides the deed to Hurley she was confronted with the deed for the same -lots without dale and without the name of any grantee, which she admitted having signed; and there was also produced to her three other papers consenting to the construction of trolley tracks with reference to the lots, all of which she admitted she had signed. It would appear then that her recollection extended to only one of the trolley consents, and that her mind was an entire blank as to the two deeds, and the other two consents for 'the trolley company.

The acknowledgment to the deed to Hurley purports to have been made before James S. Phillips, a commissioner of deeds for the State of New Jersey, residing in Philadelphia, on May 2d, 1900, the date of the execution of the deed, and is regular in form, containing the separate acknowledgment of Mrs. Gould, as required by our statute. She says- she never appeared before Mr. Phillips and never acknowledged the execution of the deed. Mr. Gould, her divorced husband, also stated that he did not appear before Mr. Phillips and acknowledge the instrument. He, however, admitted that on several occasions he had acknowledged papers before Mr. Phillips at the request of Mr. Anspach, his father-in-law. He says that when he signed the paper it had not been signed by Mrs. Gould, and she says that when she signed it it had not been signed by him. Their testimony concerning the transaction was given approximately eight years after the execution of the deed, and is, in my judgmeat, unreliable as to the facts. Mrs. Gould, while positive that she executed but one paper with reference to the Spring Lake lots, was compelled to admit upon cross-examination that she signed five papers in all, two of them being deeds. Her husband, who had been divorced from her, asserted that he had not acknowledged the deed, but admitted that he had acknowledged the execution of several documents before the commissioner who took this acknowledgment. Mr. Phillips, the commissioner, testified that he had known F. J. Anspach a number of years and had taken acknowledgments of deeds for him for lands in New Jersey made by himself and members of his family. Shown the deed from Mrs. Gould to Hurley he stated that he took the acknowledgment and the certificate was written by him although he said he had no recollection of the circumstances under which the acknowledgment was made, and frankly said that he did not know either Mrs. Gould or her husband, and he said that the facts stated in the certificate to the best of his knowledge were true. I do not see why he would not assert unequivocally that they were true, in reliance upon his certificate, but, being a cautious man, doubtless, and not remembering the incident at all, he made the somewhat stereotyped reply that the facts were'true to the best of his knowledge. He should, it seems to me, have been willing to have stated that they were true, because of his certificate. However, I do not think that the answer creates any uncertainty as to the fact, and I am prepared to believe, and do believe, that Mrs. Gould and her husband not only signed, but also acknowledged, their deed made to Hurley.

The facts and circumstances concerning the signing and acknowledgment of the deed in this case are, under the law, as enunciated by our courts, sufficient to prove its due execution and to uphold the transaction. Tookeer v. Sloan, 30 N. J. Eq. (3 Stew.) 394; Black v. Purnell, 50 N. J. Eq. (5 Dick.) 365.

That the deed from Mrs. Gould and husband to Hurley was dtlivered is too plain, it seems to me, to admit of controversy. It will be remembered that F. J. Anspach, her father, put the title in Mrs. Gould without any consideration passing from her to him, and she, it would appear, willingly executed the deed to Hurley at her father’s request, and parted with the deed to her father, if indeed, she ever had it in her possession, for her father enclosed it to Mr. McDermott in his letter to him of July 1st, 1901, and he, Mr. McDermott, retained it until he lodged it for record on June 11th, 1907, and produced it upon the trial. It is certainly to be presumed that Mrs. Gould gave the deed to her father the moment she signed it, or left it with him, which amounts to a delivery, and parted with all control over it. This constitutes a valid delivery. Jones v. Swayze, 42 N. J. Law (13 Vr.) 279; Vreeland v. Vreeland, 48 N. J. Eq. (3 Dick.) 56.

In her bill and on the argument it was claimed that Mr. Anspach had made a gift of these lots to his daughter. Her mother, the widow of E. J. Anspach, was sworn and testified that she recalled the signing of a paper by her daughter with reference to a trolley consent, and that at the time he procured his daughter’s signature the father said that it would benefit her lots at Spring Lake. Assuming that the witness accurately remembers what Mr. Anspach said some eight years before she testified, that loose declaration cannot be admitted to prove a gift of these lots to Mrs. Gould, nor can the statement of Mrs. Gould’s former husband, to the effect that when Mr. Anspach asked him to sign the deed he told him that he had a splendid opportunity to'dispose of the Spring Lake property for Edith’s advantage, or his other statement that Mr. Anspach once told him that he had given her some property at Spring Lake.

Evidence of oral admissions and declarations belong to a class of proofs which should be received with great caution. Even when they proceed from the mouths of honest and disinterested witnesses, they are liable to imperfection and error, and a word, or a look, misunderstood, will produce upon the mind of the hearer an impression entirely different from that which the speaker intended to convey. Jones v. Knauss, 31 N. J. Eq. (4 Stew.) 609, 616.

Both of the parties testifying to these statements are apparently interested in the complainant; Mrs. Anspach, the mother, naturally so, and Mr. Gould, the former husband, although divorced, by his manner upon the stand and his apparent friendliness with his former wife in the court-room, gave every evideuce of a lingering interest in her. I do not say that these witnesses have willfully misrepresented what the decedent said, but my judgment is that they are mistaken or have misinterpreted the looks or language of Mr. Anspach when he made the declarations to which they testify. These declarations are meagre and of an inconclusive character, and certainly, in view of the other facts of the case, they cannot be given controlling effect, but must be subordinated to what appears to me to be the true facts.

It may be asked why Mr. Anspach put the title to these lots in the name of his daughter. The answer is probably to be found in the two facts, one, that his wife refused to sign a deed at his request, and this about the time the conveyance from father to daughter was made, and the other, that a judgment had been recovered against Mr. Anspach in Pennsylvania by a gentleman named Paul for a large amount of money, and Mr. Paul about the time of the conveyance was pursuing Mr. Anspach in New Jersey by attachment. Besides, Mr. Anspach was in the habit of placing the title to properties in his brother and other members of his family for his own purposes and convenience.

If I be right in my conclusion that Mrs. Gould executed, acknowledged and delivered the Hurley deed, she has no interest in the claim of the estate of her father to ownership in the seven lots conveyed by Hurley to James Anspach, who, as before stated, admits that he has no beneficial interest in them and that he holds the title for the estate of his brother. Hurley and wife have executed to Mrs. Gould a mortgage on the lot remaining to him. The mortgage bears even date with the deed from Mrs. Gould to him, and is for $450. It is admitted that counsel made a mistake in drawing the mortgage, and that it should have been for $550. Another mistake was putting it in the name of Mrs. Gould, for in his letter of instruction to counsel on July 1st, 1901, Mr. Anspach expressly directed that the mortgage be made in his own favor, meaning, of course, his own name.

Mrs. Gould claims that if her father were attempting to put title out of himself and in her for the purpose of forestalling Paul in the collection of his judgment, the executors of her father’s estate cannot recover the title from her because of the rule that a conveyance made in fraud of creditors while void as to them is good inter partes, as the law will not aid a fraud-doer, but will leave the parties to the transaction in statu quo. This might be a serious consideration in the case sub judice if it were not for the fact that Mrs. Gould herself made a conveyance of the property to a third person, namely, Hurley, for her father, and, therefore, if the rule is to be applied at all it will be in aid of a status which leaves her divested of title.

It is also claimed on behalf of the complainant that the minds o£ Mr; Anspaeh and Hurley never met, and that a complete agreement for sale between them was not made. This is a question in which the complainant is not concerned. It is true the memorandum signed by Hurley was not enforceable for want of particulars as to the time the mortgage should run and the rate of interest it should draw, &c. (Potts v. Whitehead, 20 N. J. Eq. (5 C. E. Gr.) 55; Moore v. Galupo, 65 N. J. Eq. (20 Dick.) 194, but the defendants appear to have no quarrel with each other on that score, and, besides, Hurley has actually executed a mortgage to Mrs. Gould. It can be decreed to be reformed, if necessary, by making it stand as security for $550 instead of $450, and Mrs. Gould can be decreed to assign it to the executors of her father’s estate.

There will be a decree that the complainant has no right, title or interest in any of the eight lots in question; that the title of Hurley to the lot which remains in him is absolute, and that the bond from him and the mortgage from him and his wife to the complainant be canceled, and’that he execute a proper bond and mortgage to the executors of the estate of Frederick J. Anspaeh, deceased, for $550, secured on his lot, with lawful interest, unless it shall become necessary to decree a reformation of the bond and mortgage already made, in which event they will be reformed and ordered to be delivered; that the defendant James Anspaeh convey to the executors of the estate of Frederick J. Anspaeh, deceased, the seven lots, title to which were vested in him by the conveyance from Hurley and wife.

The entanglement in which this affair has been involved was caused by the carelessness and loose methods of the late Frederick J. Anspaeh, owner of the premises in his lifetime, and therefore the costs of all parties, except Mrs. Gould, will be ordered to be paid out'of his estate. Mrs. Gould will be decreed to pay her own costs.

Whether Mrs. Gould’s payment of taxes upon the premises is to be considered as compulsory, in which event she will be entitled to be subrogated to the lien of the borough of Spring Lake and to be repaid those taxes, or whether her payment of them was voluntary, is a question which was neither raised nor discussed upon the argument. It is important, and, as a fairly large sum is involved, I will hear counsel for the complainant, upon notice to -the defendants, as to whether or not Mrs. Gould is entitled to subrogation and repayment with reference to the taxes.


author: Walker, Vice-Ordinary.

text:
    The Ordinary of the State of New Jersey v. Paul V. Connolly and American Bonding Company of Baltimore.
    [Decided March 9th, 1909.]
    1. Administrators’ bonds are given to secure the creditors and next of kin of the deceased from loss through the default or fraud of the administrator, and amount to indemnity to the estate of the deceased.
    2. The ordinary is appointed by statute to make good to all persons the damages sustained by occasion of the breach of the condition of an administrator’s bond, and he must have the whole penalty, if necessary, for the purpose.

      3. The damages assessable upon a judgment recovered on an administrator’s bond should be an equitable equivalent for the condition not performed.
    4. The surety of an administrator is required to bear any injurious consequences arising from loss to the estate through the administrator’s default or fraud, and has no right to any favor or immunity that would not be accorded to the administrator himself.
    5. The damages assessable upon a judgment for the penalty contained in an administrator’s bond should include not only an equivalent for assets lost to the estate, but also all costs incurred, and reasonable counsel fees to the proctor who conducted proceedings for the removal of a derelict administrator, and to the attorney who prosecuted the suit at law to recover the penalty of the bond.
    6. The general rule is that an attorney who acts for himself is not entitled to a counsel fee against his adversary.
    7. An executor, administrator, guardian, or trustee, who is an attorney, cannot recover for professional services rendered the estate, but the rule does not apply when such costs are not payable out of the trust funds,, and when their payment will not diminish the estate.
    8. An administrator, who is an attorney, and who prosecutes a suit at law upon the bond of a former administrator, is entitled to a counsel fee as well as taxed costs to be included in the assessment of damages upon a judgment recovered on the bond against the derelict administrator and his surety.
    Oil application lor the allowance of counsel fees on the assessment of damages on a judgment on administrator’s bonds.

      Mr. Floyd II. Bradley, for the application.

      Mr. S. Conrad OU, contra.

   Walker, Vice-Ordinary.

An administrator appointed by the Camden county orphans court for the personal estate of Elizabeth M. Stigale, deceased, was removed by that court for certain derelictions, and Mr. Bradley was substituted as administrator in his place and stead.

Subsequently, by an order of this court, suit was directed to be brought upon certain bonds given by the administrator and the American Bonding Company of Baltimore, his surety. Such suit was brought and judgment was recovered for $3,500, the penalties of the bonds, and $23.31 costs of suit.

Application is now made to assess the damages, and for direction that execution issue upon the judgment to make sucli damages, with costs, including counsel fees. The application, so far as it refers to counsel fees, is resisted.

The solution of the question at issue depends, in my judgment, upon the conditions in the bonds upon which the judgment was recovered. There were three bonds. The first one was an ordinary administration bond (in the penal sum of $100), and, contained the following conditions—first, that the administrator will make and exhibit an inventory; second, that the goods, chattels and credits he will well and truly administer according to law; third, that he will make a true account of his administration; fourth, that all the residue of the goods, chattels and credits found remaining upon the account, as allowed by the proper court, he will deliver and pay over to the persons entitled. Ordinary v. Cooley, 30 N. J. Law (1 Vr.) 271, 274. In this case (Ordinary v. Cooley) the history and origin of the different conditions of an administrator’s bond are set forth and commented upon, and it is shown that the first two conditions were to secure the making an exhibition of an inventory and the payment of debts (Ordinary v. Cooley, 30 N. J. Law (1 Vr.) 277), and the last two were to secure an accounting and to pay over the surplus to the next of kin. Ordinary v. Cooley, 30 N. J. Law (1 Vr.) 278.

The second bond (in the penal sum of $1,000) recited that surplus money amounting to $487.06 arising from the sale of mortgaged premises which were of the decedent, was about to come to the hands of the administrator for the payment of debts, and contained three conditions—first, to well and truly administer the surplus money; second, to account for the- surplus which should be found remaining upon the account of such surplus money; third, to distribute and pay such surplus unto such person or persons as should be entitled to receive the same.

The third bond (in the penal sum of $2,400) contained three conditions—first, to well and truly administer the moneys arising from the sale of lands, tenements or real estate of the deceased directed by order of the orphans court to be sold; second, to account for his administration; third, and the surplus money which should remain upon the account of such sale to distribute and pay unto the person or persons entitled to receive the same.

Administrators’ bonds are given to secure the creditors and next of ldn of the deceased from loss through the default or fraud of the administrator, and amount to indemnity to the estate. Indemnity is that which is given to a person to prevent his suffering damage. 1 Bouv. Dic. (Rawle’s Rev.) 1010. These bonds are given to the ordinary for the benefit of creditors and next of kin.

In Hazen v. Durling, 2 N. J. Eq. (1 Gr. Ch.) 133, it was held that the condition of an administration bond under the statute of this state is not restricted merely to the rendering of an account but is designed to secure a faithful administration of the estate. And in Ordinary v. Snook, 10 N. J. Law (5 Halst.) 65, the supreme court held (at p. 69) that the ordinary is appointed by statute to make good to all persons the damages sustained by occasion of the breach of the condition of an administration bond, and that he must have the whole penalty, if he should find it necessary, for those purposes.

A bond is a form of obligation under seal by which the party making it, the obligor, acknowledges himself bound to the other party, the obligee, in a specified form. Literally, the obligor, by the terms of the instrument, says that he is absolutely obliged to pay the penalty unless he fulfills the condition. On failure to perform the condition, the penalty became an absolute debt, and at law was recoverable. In equity, however, it was treated as security for the performance of a condition, and relief was granted against the enforcement of the penaly on payment of a sum as damages, ascertained to be an equitable equivalent of the condition not performed; in other words, the court would not allow the obligee to take more than in conscience he ought. 2 Suth. Dam. (3d ed.) § 470.

The application now made is to include in the assessment of damages a fee for the counsel who took the proceeding in the orphans court for the removal of the administrator, and for a fee to the administrator himself, who is an attorney, and who prosecuted the same in the supreme court which resulted in a judgment on the administrator’s bonds.

The judgment is against the administrator and his surety. Whatever can be recovered against the administrator on this judgment, can, of course, be recovered from the surety.

In re Gaston Trust, 35 N. J. Eq. (8 Stew.) 60, Vice-Chancellor Van Fleet said (at p. 64) that if the accounts of a trustee become lost through his carelessness, he should be required to bear any injurious consequences arising from their loss, and that the persons bound as sureties for the defaults and fraud of the trustee have no right to any favor or immunity that -would not be accorded to the trustee. This case (In re Gaston Trust) was affirmed for the reasons given by the vice-chancellor. S. C., sub nom. Veghte v. Steele, 35 N. J. Eq. (8 Stew.) 348.

In Osborne v. Eales, 2 Moo. P. C. (N. S.) 125, it was held that recovery^'could be had to the full amount of the penal sum named in a bond of indemnity to protect a purchaser of land against adverse claims notwithstanding that the penalty greatly exceeded the original purchase-money, the purchaser having in discharge of the claim and expenses incident thereto expended a larger sum than the amount of the penalty named in the bond. The report of the case discloses that the amount recovered included two bills of costs amounting to over $3,500, one of which, amounting to over $2,000, was costs between attorney and client, and must, of necessity, have included a large amount of attorney’s fees.

In Ellis v. Norman, 44 S. W. Rep. 429, the court of appeals of Kentucky held that the surety of a forfeited bail bond is entitled to reimbursement out of indemnity given him by the principal to the extent of attorneys’ fees and' other expenses incurred by. him in good faith. As to the recovery of expenses on a forfeited bail bond, see, also, Fisher v. Fallows, 5 Esp. 171, and Sparkes v. Martindale, 8 East 593.

A surety may recover of his principal the costs which he has been compelled to pay in an action brought to recover of him the amount for which he was surety. Apgar’s Administrators v. Hiler, 24 N. J. Law (4 Zab.) 812. And a surety is entitled to indemnity against the principal debtor, that is, he is entitled to be reimbursed and made whole. Delaware, Lackawanna and Western Railroad Co. v. Oxford Iron Co., 38 N. J. Eq. (11 Stew.) 151.

It seems to me clear, upon principle and authority, that a reasonable counsel fee, necessarily incurred in the removal of an administrator, is recoverable as part of the damages resulting from his dereliction and sustained by occasion of the breach of the condition that he would well and truly administer the estate, or the breach of any of the other conditions, and for which purpose the ordinary may have the whole penalty of the bond, if necessary, as we have seen.

It remains to be considered whether the attorney who prosecuted the suit upon the bail bonds in the supreme court may be awarded a fee, in addition to costs, against the administrator and his surety. The general rule is that an attorney who acts for himself is not entitled to a counsel fee against his adversary. Flaacke v. Jersey City, 33 N. J. Eq. (6 Stew.), 57. An executor, administrator, guardian or trustee who is an attorney cannot recover for professional services rendered the estate, but the rule does not apply when such costs are not payable out of the trust funds. Flaacke v. Jersey City, 33 N. J. Eq. (6 Stew.) 59, note and authorities cited.

The reason usually assigned for not giving the solicitor profit costs, in such cases, is that he is not to profit by the trust estate. The value of that reason is only apparent when he is seeking to diminish that estate. Colonial Trust Co. v. Cameron, 24 Grant Ch. 548, 553.

Now, the attorney who prosecuted the suit at law upon the administration bonds is not here asking for a counsel fee out of the estate of the decedent which will come to his hands upon recovery under his judgment, but he is asking that the derelict administrator and his surety pay him a fee in addition to the costs of suit, just as they might be compelled to make such payment to counsel other than himself had he not prosecuted the suit in pro pers. The defendants in the suit at law cannot complain. The administrator undertook well and truly to administer the estate, and the surety was bound to see that he did so. The administrator having failed to perform this duty, he and his surety must indemnify and save harmless the estate to the full extent up to the penalty of the bond. There is no reason that counsel securing the removal of the administrator and prosecuting the administration bonds should not be paid reasonable and proper fees for their services, and, on the contrary, there is every reason why they should be compensated. The estate should not be made to bear the burden of these charges, but they should be imposed upon the administrator and his surety who became bound that the estate should be well and truly administered according to law, for the benefit both of creditors and the next of lrin of the deceased.

My conclusion upon the whole matter is, that both counsel are entitled to fees to be included in the assessment of damages against the derelict administrator and his surety. The sum of $50 will be awarded to counsel who took the proceedings which resulted in the removal of the administrator by the orphans court, and $50 will be allowed to the administrator himself, who, in his capacity as attorney, prosecuted the suit which resulted in the recovery of the judgment upon which the assessment is now to be made.


text:
    In the matter of the estate of Mary Ann Alabone, deceased.
    [Decided March 29th, 1909.]
    1. Where a testator orders the sale of his realty, the conversion will, unless a contrary intent distinctly appears, be deemed to have been directed merely for the purposes of the will; and, where realty is converted into personalty, the heir is not excluded unless the testator manifests a clear intent that the proceeds of the realty shall go to the next of kin.
    2. Where testator coniines the gift of the residuum to a particular part of the estate, the residuary legatee is excluded from any part of the estate not included in the residuary clause.
    3. Testatrix gave to nephews all the residue and remainder of her “personal estate,” and devised real estate to her executor with power to sell the same in trust for her estate.—Held, that the nephews were not entitled to the proceeds of the sale of the real estate, but the same passed to the children of testatrix.

      'On appeal from a decree of the Essex county orphans court adjudging distribution of the proceeds of the sale of real estate.

      Mr. John T. Duffy, for the appellants.

      Mr. Alfred B. Van Liew, for the respondent.
   Walker, Vice-Ordinary.

In her last will the testatrix provided,’ inter alia, as follows:

“5tb. I hereby give and bequeath to my nephews William John Merideth, of Manchester, England, and Joseph E. Merideth of Newark, New Jersey, all the rest, residue and remainder of my personal estate to be divided between them, share and share alike.
“6th. I hereby give and devise to my executor hereinafter named all my real estate No. 50 Dawson Street, Newark, New Jersey, with power to lease, mortgage, convey and otherwise dispose of the same, as to him shall seem best; the same to be held by him nevertheless in trust for my estate.”

The question presented to the orphans court, and to this court on appeal, is whether the proceeds of the sale of the Dawson street property shall be distributed to the Merideths, residuary-legatees of the personal estate of the testatrix, or to the children of the testatrix, Thomas Geddes and Margaret J. Blackwell. The balance of the proceeds of sale for distribution amounts to the sum of $1,087.03.

The Essex county orphans court directed distribution to be made to the children, and this upon a finding that the proceeds of the sale of the Dawson street property are to be considered land for the purpose of distribution.

In my judgment, the case at bar is governed by that of Moore v. Robbins, 53 N. J. Eq. (8 Dick.) 137, wherein Chancellor McGill, as ordinary, held:

‘WVhere a testator orders his lands to be sold, the conversion will, unless a contrary intention distinctly appears, be deemed to have been directed merely for. the purpose of the will, and consequently if those purposes fail or do not require it, it will, in equity, be considered land and be given to the heir.”

The reasoning in the opinion in Moore v. Robbins, and the authorities cited to sustain the judgment of the ordinary, clearly establish the doctrine that where realty is converted into personalty the heir is not excluded, unless the testator manifests a clear intention that the proceeds of the land should go to the next of kin.

The claim made on behalf of the appellants is that they are entitled to the proceeds of the sale of the Dawson street property, which is personalty by reason of its conversion into money, because they are the residuary legatees under the will; but the doctrine is, that where the testator has confined the gift of the residuum to a particular part of the estate, the legatee is excluded from any part of the estate not included in the residuary clause. Roy v. Monroe, 47 N. J. Eq. (2 Dick.) 356.

Said Vice-Chancellor Van Fleet in this case (Roy v. Monroe, at p. 356) :

“If the testator has circumscribed or confined the residue, which he makes the subject of his gift, to his residuary legatee, then his residuary legatee is not a general, but a specific legatee, and can only take that part of the residue specifically pointed out in the gift to him.”

It is to be observed that the testatrix confined the bequest of her residuary estate to personalty only. Her language is clear and unmistakable. In making tins bequest she says “all the rest, residue and remainder of my personal estate.” At her death the Dawson street property was real estate for the purposes of succession, whether the direction to convert it made it personalty from the time of her death or from the time of sale, a question which it is not necessary to decide.

I am clearly of opinion that the decree of the orphans court was rightly made, and it will be affirmed, with costs.