text:
    David Towbin et al., complainants, v. Bella Pierro et al., defendants.
    [Submitted July 29th, 1924.
    Decided March 3d, 1925.]
    1. Where fraudulent representations of facts concerning matters that may reasonably be assumed to be within the knowledge of the seller are made to a proposed purchaser of real estate by the vendor, and he, having the right to do so, relies upon them, he is entitled to relief in this coux-t, and may rescind his contract oix the ground of fraud.
    ;2. If a principal receives and retains the proceeds of his agent’s fraud, he renders himself liable for the fraudulent acts of his agent, and may not claim the fruit of the fraud which his agent has practiced withoxxt his knowledge or authority.
    On bill, &C.

      Messrs. Eichman & Seiden, for the complainants.

      Mr. David II. Siemer, for the defendants.
   Bentley, Y. C.

This is -a bill by the vendor to rescind a contract for the conveyance of real property on the ground of fraud.

On May 14th, 1923, the parties entered into a written agreement for the purchase and sale of land and building. The property consisted of a sixteen-family apartment-house. Shortly before, and either on the 7th or 8th of that month, the premises in question had been offered to the complainants, and had been inspected by one Wagner, who had an interest in the contract, in company with one of the employes of the real estate agent through whom the contract was. negotiated on behalf of the defendants. Wagner swears that he was taken by the agent’s representative into two living apartments on the premises, one comprising six rooms ancl the other four. In the larger apartment he found that it was fitted with electric light fixtures and a bath, among other improvements, and that the four-room apartment had no electric light fixtures, but did have either a bath or an appropriate place for the installation of one. He says that he was told by the agent’s representative, Grizzelle, that each of the three other six-room apartments was precisely similar in the matter of improvements as the one shown, and that each of the remaining eleven four-room apartments was similar in all respects to the four-room apartment shown. The truth of the matter is that no other apartment in the building was equipped with electric-fixtures, and no other four-room apartment was fitted with a bathtub or any place for the installation of one. Wagner also swears that he requested -permission to inspect a number of the apartments-, but was dissuaded therefrom by Grizzelle, who told him that the house was-inhabited by Armenians, -unfamiliar with our language, and that it would be impracticable to make them understand so- that they would permit admission to their respective homes. Grizzelle admits all of this testimony, except that portion dealing with the misrepresentation of similarity of all apartments with like number of rooms, and denies interfering with the inspection of other apartments except the two testified to by Wagner. In fact, Grizzelle- says that, while leaving the apartment-house, Wagner walked into another four-room apartment and made an examination of it, while he, Grizzelle, remained in the hall. The testimony of Abraham Tobin as to his inspection, of the premises on a subsequent date is, to all intents and purposes, identical with that of Wagner, and he testified that the defendant Mrs. Supino', or her husband, or both of them, had admitted later on that they had been defrauded in the same manner, and that the deposit of a thousand dollars would be returned and the contract canceled.

I am convinced that the complainants are entitled to a decree. I agree with counsel for the defendants that there has been an astounding quantity of perjury committed in this case, and I am satisfied that it has been committed upon both sides, but oil the part of the complainants it has been upon collateral details and not on the main features. Without going into any extended discussion of these less material matters, I am going to base my decision of fact upon the circumstances that Grizzelle admits every allegation of the complainants as to' his conversations with them about the fitting up of various apartments, except the one single matter of the misrepresentation as to the appointments of the apartments that the complainants did not see. Secondly, upon the undoubted fact, admitted by Grizzelle himself, that upon the meeting to pass title, when asked as to what he had sold, and before he was put upon his guard, he again let slip the statement that the four-room apartments all had places for baths. This is damning in the extreme. It may be within the realm of possibility that this man could have, conveniently for the complainants, made this mistake for the first time on the day of passing title, but it is so improbable that no serious and impartial person can possibly believe it. To do so would upset the logic of decision of facts as it had existed in courts ever since records have been kept. This, taken in connection with the perfect dovetailing of the charges made by the complainants and the testimony of the defendants except as to the differences I have mentioned, leads me to the opinion I have indicated. It may be true that the complainants are what has been described in this case as “real estate sharpshooters,” but that does not deprive them of their rights in a court of justice or alter the fact that if a fraudulent misrepresentation of fact was made to them, and they, having the right to' do so^ relied upon it, the defendants, themselves, have given them the opportunity they seek to withdraw from it. The suspicion such an occupation arouses has been kept in mind, -but it does not alter my determination of the very damaging testimony of the defendants’ witness, Grizzelle. There is no question in this case of the negligence of the complainants. In the absence of any representation on the part of the sellers, it might have been the duty of the purchasers to make their own investigations. But where the seller, who may reasonably be presumed to know the particulars of his oto property, undertakes to give information thereabout, the purchaser is entitled to' rely implicitly on the statement of the seller who in any way dissuades him from an examination. Atwood v. Small, 6 Cl. & F. 232. Ordinarily, a purchaser is charged with what air examination of the premises will reveal. But not in this case. To apply the rule under those circumstances would be to convert it into an instrument for the accomplishment of the grossest frauds.

The defendants say that, even though it be established that G-rizzelle made the false representations as to the fittings of the various apartments, still the complainants cannot recover, because a principal is not bound by the fraud of his agent. In support of this position a great number of cases are presented, such as Cooley v. Perrine, 41 N. J. Law 322; Young v. Hughes, 32 N. J. Eq. 372; National Iron Armor Co. v. Bruner, 19 N. J. Eq. 331. These cases are not in point—in fact, some .of them are authority rather against than in favor of the defendants’ argument. The rule is expressed by Professor Pomeroy in his Eq. Jur. § 909:

“If the principal receives and retains the proceeds of the agent’s fraud * * * the property, money and the like, obtained through an executed transaction * * * or claims the benefit of or attempts to enforce an executory obligation thus procured, he renders himself liable for the fraudulent acts of his agent.”

Vice-Chancellor Pitney cites this passage in Turner v. Kuehnule, 71 N. J. Eq. 466. That was a case where a woman refused to execute a conveyance with her husband, and he, acting in collusion with an attorney, had the latter purchase at the foreclosure sale under a mortgage subject to which he took title. The wife had been fraudulently told by the attorney that her interest in the property would not be affected by the sale. At page 479 the vice-chancellor said:

“A purchaser situate as is the defendant here cannot take advantage of the doctrine of ‘innocent purchaser without notice,’ when he is claiming the very fruit of the fraud which his agent has practiced without his knowledge or authority. I acted on that principle in Johnston v. Reilly, 68 N. J. Eq. 130. (Italics mine.)

Any other rule would, of course, be most inequitable.

My attention has been called to what 1 have recently said in Strauss v. Rabe, 127 Atl. Rep. 188. What I was dealing with there was the authority of a special agent to bind his principal outside the scope of his authority, and had nothing to do with the very different rule of one who seeks to reap the benefits of his agent’s fraud and exonerate himself in the same breath. In Condon v. Sandhowe, 127 Atl. Rep. 101, I refused to set aside a conveyance because of fraudulent misrepresentations made by one party to the other where the other did not purchase in reliance thereon, but instituted an independent investigation and was bound by what he learned, or could have learned, by the exercise of ordinary diligence. In that case I said:

“Had there been any effort to frustrate the attempt of the defendants in their examination of the building, a different situation would have been presented. The completest opportunity was afforded them in this respect.

In the case at bar, on the other hand, as has already been shown, G-rizzelle flagrantly and cunningly prevented the complainants from making the examination they sought to undertake. When it was attempted to look through other apartments than the two shown by him, he told the prospective purchasers that the other apartments were occupied by ignorant- foreigners who did not understand our language, and their fears and suspicions would render it impracticable to ever complete the examination of the entire building, and reiterated his assurance as to the similarity of all apartments comprising the same number of rooms throughout the structure. It would be strange^ indeed, if these complainants could be held to the terms of a contract thus entered upon.

I will advise a decree in accordance with the prayer of the bill, terms to be settled upon notice.


source: Caselaw Access Project

author: Bentley, Y. C.

license: Public Domain

text:
    Evelyn V. Cook, petitioner, v. William J. Cook, defendant.
    [Submitted January 19th, 1925.
    Decided March 13th, 1925.]
    1. The presumption that, if a wife absent herself from her husband’s home pending a suit against her for adultery, such separation is by his procurement or with his assent, does not amount to a rigid rule of law, but rather is a rule of evidence to be weighed with the other facts and circumstances of the case, and where the proofs show conclusively that the defendant abandoned the petitioner against her will and with the determined intention of never returning, the court cannot say that he remained away from his wife because of a petition he had filed against her on the ground of adultery filed five years before the instant suit was commenced, and where the proofs show that she tried to induce him to return, but he obstinately refused to do so, which had been allowed to sleep without action for four and one-half years.
    2. Marsh v. Marsh, 14 N. J. Eq. SIS; Gordon v. Gordon, 89 E. J. Eq. 535: MoGcan v. MeGean, 63 E. J. Eq. 285; Weigel v. Weigel, 68 E. J. Eq. 677; Von Bermuth v. Von Bermuth, 76 E. J. Eq. 487; Byrne v. Byrne, 93 E. J. Eq. 5; McLaughlin v. McLaughlin, 90 E. J. Eq. 322; distinguished, Sarson v. Sanson (Docket 81), 474, followed.
    On petition for divorce. On exceptions to a master’s report in a suit for divorce.

      Mr. ■John F. Frewen, Jr., for the petitioner.
   Bentley, Y. C.

The parties were married in 1913 and cohabited until 1916, when the defendant deserted the petitioner. On April 37th, 1917, the petitioner commenced a suit for divorce on the ground of adultery, wherein a citation was issued and returned as having been served personally on the defendant. In that suit the defendant was apprehended under authority of a writ of ne exeat, and released from custody on January 22d, 1918, since which time no further steps have been taken in the cause. Without dismissing, or in any other way terminating, the proceedings just referred lo, the petition in this cause was filed on July 2d, 1922, alleging desertion by the defendant, commencing in July, 1916. Thus, it will be seen that only the period from July, 1916, to April 27th, 1917, had expired before a suit for divorce was instituted between the parties. The master reports that none of the time since the date last aforesaid, and before the filing of this petition, can be counted in the period of desertion under the authority of Marsh v. Marsh, 14 N. J. Eq. 315, and the cases which have since followed, and, consequently, that there was no obstinacy to the desertion during the two years next preceding the commencement of the suit (Gordon v. Gordon, 89 N. J. Eq. 535) or at any time since the first nine months, or April 27th, 1917. To this the petitioner excepts.

The legislature of this state has prescribed the only grounds upon which this court is authorized to grant decrees of divorce, and oire ground is that of desertion. But it is not every description of separation by one of the spouses from the other that comes within the kind of desertion described by the act. The law-making body has gone further, and said that not only must the desertion be willful and continuous, but that it must be obstinate, or against the wishes and desire of the complaining spouse. McGean v. McGean, 63 N. J. Eq. 285. In the Marsh Case it was said by the chancellor that there was a presumption that a wife who absents herself from her husband’s home pending a suit by him against her for adultery does so with his assent, because it is clear that one would not sue a spouse for that offense and.still desire to have the latter cohabit with him. The only exceptions to this rule with which I am familiar were in cases such as Weigel v. Weigel, 63 N. J. Eq. 677; VonBermuth v. VonBermuth, 76 N. J. Eq. 487, and Byrne v. Byrne, 93 N. J. Eq. 5. In the first of these cases, it was conclusively shown that the first suit by the defendant was not only defeated, but overwhelmingly shown not to have been brought in good faith. In the Von Bermuih Case, the husband succeeded under a counter-claim, charging desertion for the statutory period, a necessary part of which was included in the time between the filing of his wife’s petition and the filing of the counterclaim, and the language of Yice-Chancellor Howell (at p. J/OJ/.) clearly indicates that this fact would have operated as a bar to the relief sought by the counter-claimant, were it not for the application of the exception pointed out in the Weigel Gasp, to wit, lack of good faith. So, in the case of Byrne v. Byrne, the chancellor, after reviewing and referring to practically all of the authorities in this state, found that the offense of adultery had been condoned after the institution of a suit therefor and more than two years before the institution of the suit he was there deciding. Obviously, a suit for adultery is forever put an end to by the complaining party condoning the offense upon which it is predicated, and, henceforward, as the chancellor decided, it ceases to be “pending” in good faith.

Upon first reading it would appear as if the exceptions must be overruled by reason of the decision in McLaughlin v. McLaughlin, 90 N. J. Eq. 322. In that case, the first petition in point of time was filed on October 28th, 1916, and alleged actual desertion in 1912. As in this case, the cause was permitted to sleep, and never carried to final hearing until after the filing of a, new and entirely independent petition on October 30th, 1918, alleging constructive desertion instead of actual desertion. Then a motion was made in the suit under the petition of 1916 to dismiss the original petition as of a date that would clear the two years next preceding the filing of the second petition. Although the chancellor denied the application, he clearly intimated that “in the domain of reason” the first suit should not operate as a bar, but found himself faced with the decision in Johnson v. Johnson, 65 N. J. Eq. 606. The case sub judice presents circumstances that appear to differentiate it from anjf to be found in our records except an unreported case to be mentioned hereafter.

The entire rule springs from a brief statement of law enunciated by Chancellor Green in the Marsh Case (at ¶. 018), where he says:

“The presumption must be, therefore, if the wife absent herself from his home, pending a suit against her for adulter}', that such separation is by his procurement or with his assent.”

This language has been referred to and commented upon in almost, if not every, case upon this point. A reading of it will show that by its terms it is a mere presumption (not a conclusive presumption), and, therefore, that it may be rebutted and overcome. It does not amount to a rigid rule of law to be applied as, for example, is the statutory rule or direction that a written will is not probatable unless witnessed by two individuals or declared by the testator to be his will to both witnesses at the same time. Bioren v. Nesler, 77 N. J. Eq. 560. Kather is it a rule of evidence to be weighed in with all the other facts and circumstances of the case. In the cases of Weigel v. Weigel, Von Bermuth v. Von Bermuth and Byrne v. Byrne (supra), the exceptions to the rule had all been based upon mala fides in the institution or pendency of the prior suits, and, therefore, the presumption was overborne. This could not have been so if it was an unyielding rule such as Lord Coke’s understanding of the effect of the doctrine of estoppel. In the unrecorded case to which reference has been made, namely, Sarson v. Sarson (Docket 31), J71h the- first suit was commenced July 9th, 3907. It was never actually dismissed until after the second suit had been commenced, but it had been treated as abandoned from the time of the filing of an opinion by Vice-Chancellor Stevens on July 16th, 1908. The master to whom the second cause was referred found that there had been willful and continued desertion, but that the same had not been obstinate because of the pendency of the former suit, or until at least July 3 6th, 1908, upon the filing of the opinion mentioned, when insufficient time would have remained. The chancellor, principally upon the reasoning of Easter v. Easter (a New Hampshire case reported in 78 Atl. Rep. 80), sustained the exceptions to the report, and decrees nisi and final were duty entered. In the Easter Case a libel was filed by a wife, and, while the suit was still pending, commenced another for desertion under a statute similar to our own for the purpose of this discussion. It was there objected by the libellee that the pendency of the first suit was a bar to the second. But the objection was overruled- Chief-Justice Parsons, in his argument, made use of the following language:

"The pendency of a libel for divorce is an evidentiary fact, bearing upon the question whether the absence complained of is such an abandonment as the statute makes a cause for divorce, but it is not necessarity decisive of the question. * * * But in this case the separation was not caused by the plaintiff’s former suit, nor justified by the plaintiff’s conduct, but resulted from the defendant’s wrongful act prior to the commencement of that suit. The former application for divorce upon the ground of-abandonment did not conclusively establish that the libellant consented to the separation, nor the pendency of the application necessarily destroy the libellee’s abandoning intent.” (Italics mine.)

While this decision has no binding effect upon this court, the reasoning of the chief-justice appeals to me as a sensible and logical statement of the effect of the rule in question, and. was given force b3 the chancellor’s adoption of it in the Sarson Gase.

Briefly considered, the proofs before the master, abundantly corroborated, prove that in 1916 this defendant abandoned the petitioner against her will and with the determined intention of never returning to her. In order to shake off his obligations to her and their child, and another to be born, he even-hinted at suicide, accused himself of adultery, and represented himself as being a fugitive from justice. After he had deserted his family he was three times brought back into this jurisdiction in invitum by the criminal authorities under an indictment for desertion. Upon his trial he admitted that he had received his wife’s message concerning the death of one of their children, and that not even that tragedy had been sufficient to bring him back to attend the ¡funeral. In face of these facts, and in consideration of Sarson v. Sarson and Easter v. Easter (supra), it would be the height of the ridiculous to assume, or for any court to say, that this man remained away from his wife because of the petition on the ground of adultery.

Thus, the desertion being willful and continued for the requisite period, it only remains to be determined whether it was obstinate^ in view of the presumption arising from the pendency of the first suit. “Obstinate” means against the will of the other party. The facts are, as abundantly shown in the proofs, that repeated efforts were made by the defendant to secure the acquiescence of his. wife in a separation. It is just as fully established that she very properly refused to agree to any such proceeding, but, on the other hand, went far beyond what it was her duty to do to try to bring this, man to a realization of his duties and a re-establishment of their home. She had thought enough of the defendant to become the mother of two of his children, and appears to still have had enough affection for him to desire to live with him. When she was finally driven to understand that he would never repent and take up again his obligations and give to her his society to which she was entitled, she resorted to the remedy that the law has fabricated to meet just such a case and filed her petitions, under the first of which she apparently had no sufficient proofs., but under the second of which she had evidence in abundance. It seems to me that to apply in this case the rule laid down in Marsh v. Marsh, supra, would be to carry the presumption, which she has met and overcome, to a conclusion at odds with the clear intent of the legislature, as expressed in the Divorce act. In McLaughlin v. McLaughlin, supra, there was no such state of facts presented as to 'be found in the case at bar, and, in addition, there is the further significant fact that the defendant in the McLaughlim, Case promptly, vigorously and continually 'defended his wife’s suit for divorce, from which it may well be inferred that he was not averse to the marriage state, and that the wife may have been all too well pleased with the separation existing between her and her husband, while in the ease now to be decided, for the reasons I have shown, it is manifest that the defendant deserted, the petitioner entirely against his wishes, and, in short, that it was through Ms obstinacy.

If it were made to appear that the suit for adultery was instituted by the wife with the fraudulent design of keeping the husband away from her, and then' seek to< predicate a petition on the ground of desertion upon that separation, a very different case would be presented. Or, if it were not so clear that the petitioner had shown beyond pera&ranture her dissatisfaction with the breaking up of the home, a different determination might be reached.

The exceptions should be sustained.


author: Foster, Vice-Ordinary.

text:
    In the matter of the appeal of John P. Messler and Ella M. Applegate from a decree of distribution of the orphans court of the county of Monmouth, in the matter of the estate of Lydia, E. Tantum, deceased.
    [Submitted November 28th, 1924.
    Decided December 18, 1924.]
    Where next of kin of a decedent are all related in equal degree, being children of half-sisters of the decedent, under P. L. 1918 p. 179, they take per stirpes and not per capita.

      Mr. Edwin P. Longsireel, for the appellants.

      Mr. Frank I. Smith and Mr. Richard 17. Stout, for the respondents.

      Messrs. Stokes & McDermott and Mr. William Hartshorne, for the respondents, administrators* &c.
   Foster, Vice-Ordinary.

On June 26th, 1924, a decree of distribution was made by the orphans court of Monmouth county in the matter of the estate of Lydia E. Tantum, deceased.

The decree directs the distribution of the estate in the hands of the administrators, which amounts to $22,600.07 (less $1,863.58 to be paid to the state for inheritance tax), equally among the nieces and nephews of the intestate.

The decedent, Lydia E. Tantum, died intestate on- the 28th of February, 1923, and letters of administration were granted to the respondents, Frank Horner and John A. DeBoa ch.

At the time of her death decedent left no husband nor children, nor any legal representatives of any child, or or parents, nor brothers and sisters. The distributees are all children of half-sisters of the decedent.

Decedent had three half-sisters, viz., Anne Bowman Messier, Phcebe B. Thompson and Sara V. Bowman-Fountain, who predeceased her. Mrs. Messier left four children surviving her, the appellants being two of them. Mrs. Thompson left her surviving three children, and the widow and three children of her deceased son William, who died before decedent, and Mrs. Fountain left two children surviving her.

Appellants contend that as the distributees are all next of kin related in equal degree to the decedent, the decree should have directed the division of the estate among them per capita and not per stirpes.

This contention is based upon the statute of distribution which was in force, with slight variations from time to time, from 1795 to 1918.

Our statute of 1795 (Pennington’s laws) is an almost literal copy of the English statute of 1671 {22 and 23 Car. II eh. 10), and an interesting history of the legislation on the subject will be found in the opinion of Chancellor Zabriskie, in the case of Fidler v. Higgins, 21 N. J. Eq. 138.

Prior to 1918, by virtue of the statute, the nieces and nephews of an intestate were entitled to participate in the distribution of the personal estate only as next of kin of the decedent, and if they were related in equal degree to the intestate they took a part or share of the estate per capita. But if the claimants to the estate were related to the decedent in unequal degree, or if they claimed by representation, then they took per stirpes. Fidler v. Higgins, supra; Davis v. Vanderveer’s Admr., 23 N. J. Eq. 581; Wagner v. Sharp, 33 N. J. Eq. 520; Fisk v. Fisk, 60 N. J. Eq. 195; Smith v. McDonald, 69 N. J. Eq. 765; affirmed, 71 N. J. Eq. 261.

In 1918 the legislature, by chapter 63 of the laws of that year {P. L. 191S p. 179), amended subsections 3 and 4 of chapter 47 of the act of 1914 (P. L. 191.1/ p. 69), which had amended certain subsections of section 169 of subdivision 14 relating to distribution under the Orphans Court- act. 3 Comp. Slat. pp. 3871/, &c.

The amendments to subsections 3 and 4, made by the act of 1918, makes these subsections now read as follows:

“Section 3. If there be no husband or widow, as the cause may be, then all of the said estate to be distributed equally to and among the children, and in case there be no 'child, nor any legal representative of any child, then equally among the parents and brothers and sisters, and the representatives of deceased brothers and sisters, provided that no representation shall he admitted among collaterals after deceased brothers’ and sisters’ children.
“Section 4. If there be no husband or widow, child or any legal representative of any child, nor a parent, brother or sister, nor the representative of a deceased brother or sister, then all the estate to be distributed equally to the next of kindred in equal degree, of or unto the intestate, and their legal representatives as aforesaid.”

The words in italics are the pertinent- parts of the amendments with which we are now concerned, and it is clear'that the effect of these amendments is to- take the- children, o-r representatives, of deceased brothers and sisters of the intestate, out of their former classification as next of kin of the decedent, and to place them among the collateral relatives of the intestate among whom the statute now directs the personal estate shall be equally divided, before other next of kin or more remote degree can participate in its distribution.

The present statutory direction is a variation from the scheme of distribution that had continuously prevailed prior to 1918, for not only are the children (representatives) of deceased brothers and sisters of the intestate removed from participation in the distribution of the estate as next of kin, but they are now placed in priority over all others classed as next of kin, in the event that the intestate does not leave surviving any of the other relatives previously specified in the statute.

The further effect of the amended statute is that it deprives nieces and nephews, in equal degree, in their capacity as the representatives of deceased brothers and sisters of the intestate, of the possibility of distribution being made among them per capita,, as next of kin, for the terms of the statute, in its reference to the representatives of deceased brothers and sisters, are not mere words of description, but are clearly intended to indicate the capacity in which the (children) representatives of deceased brothers and sisters of decedent shall take part or share of the estate.

By the terms of the amendments of 1918 express and explicit directions are given that, upon the failure of other specified relatives to survive the decedent, the personal estate is to be distributed equally to and among the representatives of deceased brothers and sisters.

This direction is twofold in its terms, for it requires, not only an equal distribution, but an equal distribution to and among the representatives of intestate’s deceased brothers and sisters, and it clearly eliminates such representatives— the neices and nephews in the instant case—from participation as next of kin, and permits their participation in the distribution only in their capacity as representatives of their deceased parents.

The right of the appellants and of the other parties interested to participate in the distribution of this estate rests upon the statute, and the statute in force applicable to this controversy is the act of 1918, which in express terms permits the children of the deceased brothers and sisters of the intestate to participate in the distribution of this estate only by way of representation, í. e., as the representatives of their deceased parents; and in granting this privilege of participation the statute expressly directs that such distribution of the estate shall be made to and among such representatives equally.

It is conceded that, although the appellants and the other interested parties are only half-blood relatives of the decedent, they are entitled to share in the estate equally with relatives of the whole blood. Smith v. McDonald, 71 N. J. Eq. (at p. 264).

The decree appealed from directs an equal distribution of the estate among the nieces and nephews of decedent, as representatives of her deceased half-sisters, in strict conformity to the requirements of the amending act of 1918, and I will therefore advise that it be affirmed.


author: Gummebe, Chibe-Justice.

text:
    Guarantee Trust Company, complainant-respondent, v. Fitzgerald Hotel and Development Corporation et al., defendant-appellant.
    [Decided February 19th, 1925.]
    1. Judicial sales made without irregularity or fraud, and which have not been affected by accident or mistake, will not be set aside for mere inadequacy of price.
    2. Only such mistakes as have been producing causes of the sacrifice of the property sold will justify the setting' aside of judicial sales fox-inadequacy of price.
    On appeal from chancery.

      Mr. John 0. Feed, for the- appellants.

      Mr. Biwood G. Weeks and Mr. William I. Garrison, for the respondent.
   The opinion of the court was delivered by

Gummebe, Chibe-Justice.

This is an appeal from an order confirming a foreclosure sale. The complainant, the Guarantee Trust Company, filed its bill to foreclose a mortgage for $40,000, given to it by the Fitzgerald Hotel and Development Corporation in part payment of the purchase price for the property. In due course a decree of foreclosure was entered in the cause; a writ of fieri facias was issued thereon to the sheriff of Atlantic county, who duly advertised the property for sale, and, at the time and place designated in the advertisement, put the property up. at public auction and struck it off to the Louis Satanov Real Estate and Mortgage Corporation for the sum of $54,025, that being the highest bid received for the same. The property was sold subject to. a prior mortgage of $5,000, with accrued interest and taxes for the year 1923, and also for a portion of the year 1924, the total amount of these liens being $7,359. The sale having been duly reported by the sheriff to the chancellor, its. confirmation was opposed by the defendants and by the receiver of the hotel and development corporation (who* was. appointed during the pendency of the foreclosure suit) upon two grounds—(1) that the sale was brought about through a mistake on the part of the officers and stockholders of the hotel and development corporation in believing that the effect of the order appointing the receiver and restraining them from further carrying on the business of the corporation prohibited them from thereafter taking any action to protect the interests of the corporation, and (2) because the price brought at the foreclosure sale was inadequate, this being shown by the fact that, since such sale, the receiver had been offered by a responsible party the sum of $72,000 for the mortgaged premises. Notwithstanding the opposition of the defendants and of the receiver, the court of chancery confirmed the sale, and from the order of confirmation the present appeal is taken.

The grounds upon which we are asked to reverse the order confirming the sale are the same as those which were advanced by the present appellants in opposing the confirmation. The contention that the sale was brought about through a mistake on the part of the officers and stockholders of the hotel and development corporation as to the effect of the restraining order in the suit for the appointment of a receiver appears to us to be without merit. The appellants very frankly admit that the entire corporate assets at the time of the sale consisted of the real estate under foreclosure and some $3,500 of rents due from tenants who were in occupation of the premises. There is no suggestion on their part that, if it had not been fox the mistake referred to, the officers or stockholders of the corporation could have taken any steps that would have been effective in preventing the sale, or that would have resulted in the procuring of bids in excess of that at which the property was struck off by the sheriff. Only those mistakes that have been producing- causes of the sacrifice of the property sold will justify the setting aside of judicial sales for inadequacy of price. Eberhart v. Gilchrist, 11 N. J. Eq. 167; Kloepping v. Stellmacher, 21 N. J. Eq. 328.

The other ground upon which tire respondents base their opposition to the confirmation of the sale (viz., that the price brought thereat was inadequate) is equally untenable. It has long been the settled doctrine and practice of the courts of this state that judicial sales, made without irregularity or fraud, and which have not been affected by accident or mistake, will not be set aside for mere inadequacy of price, and the reason is thus stated by Mr. Justice Magie in delivering the opinion of this court in Morrisee v. Inglis, 46 N. J. Eq. 306, 309: “This well-known practice is in accord with the policy of our law respecting such sales, which are required to be made, after advertisement sufficient to give publicity, by public outcry to the highest bidder. It is of the greatest importance to encourage bidding by giving to every bidder the benefit of bids made in good faith and without collusion or misconduct, and, at least, when the price offered is not unconscionably below the value of the property. Nothing would more evidently tend to discourage and prevent bid-cling than a judicial determination that such a bidder may be deprived of tlm advantage of his accepted bid, whenever any person is willing to give a larger price. The interest of owners in particular cases must give way to the maintenance of a practice, which, in general, is in the highest degree beneficial." The cases of Hoffman v. Godfrey, 79 N. J. Eq. 617, and Hurley v. Pollash, 93 N. J. Eq. 167, are subsequent decisions of this court in which this principle has been enforced, although the difference of percentage between the price at which the property was struck off, and the price subsequently offered therefor by a responsible party, was much greater than that which exists in the present ease. Other cases in which the court has refused to set aside a judicial sale for inadequacy of price, notwithstanding the fact that the percentage of difference was greater than that which exists in the case now under consideration, are referred to in the opinion delivered in Rogers v. Rogers Locomotive Co., 62 N. J. Eq. 118.

For the reasons stated the order confirming the sale will be affirmed.

For affirmance—The Chiee-Justice, Trenchard, Parker, Mtnturn, Kalis oh, Black, Katzenbach, Campbell, Lt.oyd, Gardner, Van Buricirk, Clark, McGlennon, JJ. 13. .

For reversal—None.


author: Gummere, Chief-Justice.

text:
    John J. Barry, complainant-appellant, v. David Tunick et al., defendants-respondents.
    [Decided February 19th, 1925.]
    1. The act to quiet title to lands (J/ Comp. (Hat. p. 5S99) was designed for the relief of a class of persons who, -being in peaceable possession of lands, have no means of contesting the validity of adverse claims thereto by suits in due course of law, and the test in relation thereto is whether the defendant, setting up a claim of title to, or of interest in, the land, has interfered with the complainant’s possession of the property by acts of such a character that a suit at law by the complainant, based upon such interference, would involve the defendant’s claim of title or interest in the lands.
    2. In a suit to quiet title t.o lands where interference with the complainant’s exclusive possession is alleged and conclusively shown by an act which is suable at law, then the possession of the complainant is not peaceable with the-meaning of the statute, and the court of chancery is without jurisdiction thereunder.
    On appeal from chancery.

      Mr. Charles F. Lighthipe, for the appellant.

      Mr. William, II. Osborne and Mr. Henry T. Stetson, for the respondents.
   The opinion of the court was delivered by

Gummere, Chief-Justice.

The purpose of the bill in this case was to obtain a decree quieting the title to a certain tract of land in the city of Orange. It was filed by Barry, the present appellant, under an act entitled “An act to compel the determination of claims to real estate in certain cases and to quiet the title to the same” (Comp. Stat. p. 5899), against the present respondents, Tunick, Reznik, Krasner and Lange. Its averments exhibited a cáse within the statute, namely, that the complainant was in tire peaceable possession of the land, claiming to own the same; that his title thereto-, or some part thereof, was denied and disputed by each of the defendants, who- severally claimed that they were owners of the land, or of some interest therein, and that no- suit was pending to enforce or test the validity of either of the claims o-f the respective defendants. To- this bill each of the defendants filed a separate answer, severally averring that he had an easement o-f way over the land of the complainant, and that he and his predecessors in title had continuously used this way for a period of more than thirty years next preceding the filing of the bill as an appurtenant to- a tract owned by him and adjacent to- the land owned by the complainant. A replication was filed by the- complainant to- the several answers, denying the existence o-f these easements of way. At the hearing, however, no- attempt was made by him to support that denial, and the evidence submitted by the respective defendants very clearly proved the existence of a right of way vested in each of them. Thereupon a decree was entered establishing the validity of the respective claims o-f the several defendants, and perpetually restraining the complainant from interfering with the defendants in the enjoyment thereof. From this decree the complainant has appealed.

The act under which the bill was filed was designed for the relief of a class o-f persons who-, being in peaceable possession of lands, have no means of contesting the validity o-f adverse claims thereto- by suits in due course of law. Sheppard v. Nixon, 43 N. J. Eq. 627. And by peaceable possession under this act is meant peaceable as against the defendant, the test with relation thereto- being whether the defendant, setting up a claim of title to or of interest in the land, has interfered with the complainant’s possession of the premises by acts o-f such a character that a suit at law by complainant, based upon such interference-, would involve the defendant’s claim of title o-r interest in the land. Allaire v. Ketcham, 55 N. J. Eq. 168; DeHanne v. Bryant, 61 N. J. Eq. 141. Where there has been such interference by an act which is suable at law, then the possession of the complainant is not peaceable within the meaning of the statute, the statute is not operative, ancl the court of chancery is without jurisdiction over the subject-matter of the litigation. Jersey City v. Lembeck, 31 N. J. Eq. 255, 271.

In the present case the continued user of the alleged way by each of the defendants, if without legal justification, constituted a series of trespasses, for which actions at law would lie in favor of the complainant, and the judgments in such actions would settle the question of the right of the complainant to hold his land free from the further user thereof by the respective defendants. The complainant’s possession, therefore, not being a peaceable possession, within the meaning of the statute, and he having a complete remedy at law for the alleged illegal acts of the several defendants, the court of chancery was without jurisdiction to' try and determine the legal title to the easements in dispute, and the bill of complaint should have been dismissed for this reason. Penrose v. Absecon Land Co., 94 N. J. Eq. 436.

The decree under review will be reversed.

For affirmance—None.

For reversal—The Chief-Justice. Trenchard. Parker, Minturn, Kalisoh, Black, Katzenbach, Campbell, Lloyd, Gardner, Van Burkírk, Clark, MoGlexnon, Nays, JJ. 14.


author: Trencharb, J.

text:
    Max Katz, complainant-appellant, v. Max Newman et al., defendants-respondents.
    [Argued November 3d, 1924.
    Decided January 19th, 1925.]
    1. On an application to restrain the vendor of a business and its good-will from violating a covenant not to engage in the same or similar business within an area mentioned, the difficulty of defining the exact area to which the restriction was intended to apply does not prevent the court from enforcing it to the extent of a definite and divisible part of such area to ‘which at least the parties certainly intended it to apply, and which is necessary for the protection of the business and not opposed to public interests.
    2. The vendor of a grocery business and its good-will, which was' carried on at No. 607 Summit avenue, Jersey City, covenanted with his vendee that he would not engage in the same or similar business “for a period of five years within a radius of twenty square blocks from said 607 (Summit avenue, Jersey City.” Eeld, that by the true construction of the covenant it should be read as binding the vendor not to engage in the same o.r similar business “either in the premises No.. 607 Summit avenue, Jersey City, or within a radius of twenty square blocks from such premisesheld, further, that the covenant so read describes a divisible area, and that if the area of the restraint contracted for, so far as it embraces territory outside of such premises, is indefinite o.r difficult of exact definition, still, in respect to the premises No. 607 Summit avenue, it is definite and clearly necessary for the protection of the business as it existed at the time of the sale, and, to that extent, is capable of enforcement.
    On appeal from an order of tlie court of chancery advised by Vice-Chancellor Bentley.

      Messrs. Levüan & Levitan, for the appellant.

      Messrs. Gross & Gross, for the respondents.
   The opinion of the court was delivered by

Trencharb, J.

In this case the complainant filed his bill to- enjoin the defendants from conducting a grocery business in violation of a covenant in a bill o£ sale held by the complainant.

Upon the filing of the bill and affidavits there was granted an order to show cause why a preliminary injunction should not issue “restraining the defendants from further operate ing the grocery business at No. 607 Summit avenue, Jersey City.” On the return of that order (as appears by the vice-chancellor’s opinion) “no answer was filed or any affidavits or other proofs submitted on behalf of the defendants,” the defendants taking the position (as appears by their brief) that the covenant in the bill of sale “was indefinite, and, therefore, unenforceable,” and no- other question was raised. In that situation the learned vice-chancellor, after argument, dismissed the order to show cause, and from that action this appeal was taken.

We are of the opinion that such dismissal cannot be sustained.

The complainant’s bill and affidavits disclosed that on-October 20t!i, 1920, the defendant Mary Newman, by bill of sale in writing, sold her grocery business, and its'goodwill, at No. 607 Summit avenue, Jersey City, to the complainant, Max I£a.tz, and Sam Suchman (and their assigns), who took immediate possession; that the consideration therefor was $1,950, in the proportion of $450 for the stock and fixtures and $1,500 for the good-will; that such bill of sale, among other things, provided that “the party of the first part also agrees not' to engage, directly or indirectly, in the same or similar business for a period of five years within a radius of twenty square blocks from said 607 Summit avenue, Jersey City;” that in June, 1922, Sam Suchman assigned his one-half interest in such business to the complainant; that on March 1st, 1923, the complainant removed such business from the building, No. 607 Summit avenue, to No. 611 Summit avenue, two doors away from the original location, where he now conducts it; that on December 20th, 1923, the defendant Mary Newman opened up and proceeded to operate a grocery .business, under the name of Max Newman (her husband), the other defendant, at the original location (No. 607 Summit avenue), in all respects similar to that sold to the complainant, and at once began to solicit the trade of the complainant, to the latter’s injury.

Without regard to what may possibly appear on final hearing, we think the situation thus disclosed entitled the complainant to a preliminary injunction.

Of course, a contract such as that in question, which is in partial restraint of trade, is not objectionable to public policy, unless it goes farther than is reasonably required for the protection and enjoyment of the business sold, or unless the restraint is so> great as to interfere with the interests of the public. Fleckenstein Brothers Co. v. Fleckenstein, 76 N. J. Law 613; Scherman v. Stern, 93 N. J. Eq. 626. As we have pointed out, it its not contended that the covenant not to engage in the grocery business “for a period of five years within a radius of twenty square blocks from 607 Summit avenue, Jersey City,” was greater, either in point of time or space, than was reasonably required for the protection and enjoyment of the business sold, or that the restraint is so great as to interfere with the interests of the public.

The defendants, however, did contend (and now contend), and the court below concluded, that the covenant was too indefinite in respect to space to be enforced, and for that reason the vice-chancellor refused relief. He relied mainly upon two cases, in the court of chancery, namely, Messinger v. Franzblau, 118 Atl. Rep. 260, and Tsangas v. Broogos, 2 N. J. Adv. R. 139; 95 N. J. Eq. 499. But those cases are distinguishable from this, and, -we think, are not applicable here, and so call for no further comment.

It may be conceded that the precise boundary lines of the restricted area are .indefinite or difficult of exact determination because of the use of the word “radius” in connection with “square block.” And in this connection the defendants argue that, taking the premises in question (No. 607 Summit avenue) as the starting point, and proceeding in every possible direction “twenty square blocks,” would not result in a perfect geometrical circle, owing to the alleged irregularity of the different blocks in the neighborhood. But this, if true, we regard as unimportant in the circumstances of this particular ease.

By analogy with the sale of the good-will of a brtsiness, the difficulty of defining the exact area to which the restriction was intended to apply, does not prevent the court from enforcing it to the extent of a definite and divisible part of such area to which, at least, the parties certainly intended it to apply, and which is necessary for the protection of the business and not opposed to public interests. Fleckenstein Brothers Co. v. Fleckenstein, supra; Trenton Potteries Co. v. Oliphant, 58 N. J. Eq. 507; Hubbard v. Miller, 27 Mich. 16; 15 Am. Rep. 153; 6 R. C. L. 903.

As we have pointed out, according to the uncontradieted averments of the bill and affidavits, the defendants, after taking the complainant’s money, and making the covenant in question, opened up a competitive business in the very premises in which the original business sold was carried on, upon complainant’s removing the business which he had purchased, with the good-will, two- doors away in the same block.

By the terms of the covenant the defendant promised not to engage in a competing business “within a radius of twenty square blocks from 607 Summit avenue, Jersey City.” No doubt the use of the word “radius” in this connection presents some difficulty, but we think that the covenant may be fairly read as binding the defendant not to engage in the same or similar business either in the premises, No. 607 Summit avenue, Jersey City, or within a radius of twenty square blocks from such premises. Reading it thus, ■ the description is a divisible one, embracing not one whole area, but two areas disjunctively described. Fleckenstein Brothers Co. v. Fleckenstein, supra. If it be said that such construction, making the area embraced in the contract divisible, is a'forced one, our reply is that it is not only a possible one, but when we consider the subject-matter in connection with which the language was used, our construction is in harmony with the undoubted intention of the parties to at least provide a restraint, for the protection of the purchaser, from competition in the very premises where the business sold was located, and that is all the complainant asked for by his rule to show cause. If the area of the restraint contracted for, so far as it embraces territory outside of such premises, is indefinite or difficult of exact definition, still, in respect to the premises No'. 607 Summit avenue, it is definite and clearly necessary for the protection of the business as it existed at the time of the sale, and, to that extent, is capable of enforcement.

This conclusion renders it unnecessary to determine the exact extent of the broader sweep of the restricted area, or the rules by which it may be determined. Such questions will be left for consideration when and if occasion arises. In the Fleckenstein Case, supra, the vendor of a business, the principal part of which was carried on in Jersey City, covenanted with his vendee that he would not engage in a competing business “within five hundred miles from the city of Jersey City at any time within a period of twenty years.” It was there held that, although taken literally, that language did not include the territory of Jersey City within the protected area, nevertheless, by the true construction of the covenant, that territory is a part of the area from which the vendor has excluded himself, and that it should be read as binding the vendor not to engage in business “either in the city of Jersey City or within five hundred miles from that city;” and it was further held that the covenant, so read, describes a divisible area, and that, if the restraint contracted for, so far as it embraced territory outside of Jersey City, is unreasonable, and, to that extent, invalid, still, in respect to Jersev City, it was clearly unnecessary for the protection of the business as it existed at the time of the sale, and, to that extent, was capable of enforcement.

That case differs from this, in that there it was contended and assumed, for the purpose of the decision, that the covenant, in so far as it embraced territory outside of Jersey City, was unreasonable, and, therefore, opposed to public policy. Here no such question is presented, or even suggested, but the underhung principles of that case, as well as that of Trenton Potteries Co. v. Oliphant, supra, is pertinent.

The result is that the order appealed from must be reversed, with costs, and a decree made enjoining the defendants, unt’l further order of the court, from further operating the grocery business at No. G07 Summit avenue, Jersey City.

Fur affirmance—None.

For reversal—The Chief-Justice, Teenchard, Parker, Minturn, Black, Katzenbach, Campbell, Lloyd, Van Buskirk, Clark, MeG lennon, Kays, JJ. 12.


author: Parker, J.

text:
    In the matter of Elwyn S. Wintermute, substituted administrator cum testamento annexo of Mary Smith, deceased; George A. Ayers et al., appellants.
    [Submitted November 10th, 1924.
    Decided January 19th, 1925.]
    A testatrix disposed of her residuary estate as follows: “Second. It is my will and I do hereby give and bequeath to my two sisters, Susanna Smith and Marilda Smith, to be divided equally between them, after the payment of my debts and funeral expenses as above mentioned, the balance and residue of my estate, both real and personal property, in whatever it may consist, or wherever situate; and in ease at the time of my decease either one of my sisters, as aforesaid, should not be living, then it is my will and I do hereby give the whole of my estate to the one surviving.” Susanna died before testatrix, leaving issue. Marilda died after Susanna, and before testatrix, without issue and unmarried. Held, that section 22 of the Wills act (Comp. Stat. p. 5866) was not applicable, and if applicable, the case was within the proviso of that section, and that there was intestacy as to the residuary estate.
    On appeal from a decree in the prerogative court advised by Vice-Ordinary Cliurch, whose opinion is reported in 95 N. J. Eq. 681.

      Mr. Elmer King, fo.r .the appellants.

      Mr. Alfred F. Skinner, for the respondent.
   The opinion of the court was delivered by

Parker, J.

The judicial action brought up by this appeal is an order of the Warren county orphans court, dated March 1st, 1923, dismissing exceptions to an account filed by the administrator above named, and an affirmance of that order in the prerogative court. The crux of the case is the ground taken for that dismissal, which is that the exceptants have no interest in the estate, and, consequently, no standing to except. If this be so, the decree in the prerogative court should be affirmed. If they have an interest, that decree should be reversed.

The decision that exceptants have no interest rests on the proposition that the purview of section 22 of the Wills act [Comp. Siat. p. 5866) is applicable under the circumstances of the case to the residuary clause in the will of Mary Smith, and that the proviso of said section is not applicable. The residuary clause is copied in full, and the statute abstracted, in the opinion of the learned vice-ordinary. The proviso he has reproduced .in full. ,

Of course, it is perfectly clear that if the testatrix had left her residuary estate to her two sisters generally, and one of them had died in her lifetime leaving issue, such issue on surviving testatrix would take the share of the parent. Equally, of course, the testatrix is presumed to have framed her will with the statutory regulations in mind.

But when we examine the language of this residuary clause we. are struck at once by the evident intent that it is survivorship of the testatrix by the immediate legatees named in the will that is the test laid down for.succeeding to the property. If she had stopped with the bequest to her two sisters to be divided equally between them, the case would be far different, and section 22 would, no doubt, apply! But her real intent is manifested in the second part of the clause:

"And in case at the time of my decease either one of my sisters as aforesaid should not be living, then it is my will and I do hereby’ give the whole of my estate to the one surviving.”

Now, at the time when the will was made, the two sisters, Susanna and Marilda, were, of course, living. Susanna married the next day and had issue. She died in 1911, before Marilda, leaving one son, the present administrator. By her death before testatrix, the whole, by the express language of the residuary clause, was to pass to Marilda, and, if Marilda had survived testatrix, she would have taken all. She did not survive her, but died unmarried in 1919, while testatrix lived till 1921. Consequently, we have the case of Susanna’s share failing by her predecease, and Marilda’s share also failing for the same reason, and both in view of the plain language of the will in which survivorship is a sine qua non. To say’ that the inheritance swings over to Susanna’s issue is, in our view, an erroneous application of the statute. If the act be applicable at all, the proviso' is met by this will. We think it is not applicable at all; that it is aimed at cases where the testamentary provision is not limited by the necessity of survivorship in order to take. The statutory language is: “Whenever any estate * * * shall * * * be * * * bequeathed * * * to any person being * * * a brother or sister,” &c. This refers to a bequest at large and not to' one expressly barred from taking effect unless the legatee survive testator.

Even if the contrary be conceded for the sake of argument, the protoso would apply. It says: “This provision shall not apply when the testator * * * shall by the will * * * have otherwise directed in. regard to the children * * * of said * * * legatee dying as aforesaid.” The direction in the will is that if either sister died before testatrix, the estate shall go to the other, which is saying quite plainly’ that the dying sister’s issue shall not take in any event. Whether Marilda’s issue, had she left any’, would have taken by surviving testatrix, is a question not before us, as Marilda had no children.

The legacy lapsed as to Susanna because she did not survive testatrix, and was thereby excluded by the will.

It lapsed as to Marilda because she was not living to receive it.

Our conclusion is that testatrix died intestate with respect to the residuary estate, which therefore devolves as provided by law.

Consequent^, appellants as next of kin were entitled to except to the account. The decrees brought up' will be reversed and the case remanded, with directions that further proceedings be had in conformity to these views.

For affirmance—None.

For reversal—The Chief-Justice, Trenchard, Parker, Minturn, Black, Katzenbach, Campbell, Lloyd, White, Gardner, Van Buskirk, Clark, McGlennon, Kays, JJ. 14.


text:
    The Moore Securities Company, complainant-appellant, v. O. J. Hammell Company and Karl Schaffer, defendants-respondents.
    [Argued October 27th, 1924.
    Decided January 19th, 1925.]
    The procedure for foreclosure of a tax title prescribed by sections 46 et seq. of the Tax Sale Revision act of 1918 (P. L. p. 883) does not apply to cases where the sale for taxes has taken place before the act of 1918 went into effect.
    On appeal from a decree advised by Vice-Chancellor Ingersoll.

      Mr. Clarence L. Cole, for the appellant.

      Mr. John S. Wescolt, for the respondents.
   The opinion of the court was delivered by

Parker, J.

The bill is framed as a bill to foreclose a mortgage. The mortgage, its transfer to complainant, and the conveyance of the equity of redemption to the PTammell Company, were either admitted on the record or conceded at the hearing. The contested feature o£ the case relates to a sale of the mortgaged premises for taxes of 1914, admitted by complainant, and proceedings by Schaffer, the tax purchaser, to perfect his tax title over the mortgage, the efficacy of which proceedings complainant denied. The vice-chancellor filed a short memorandum stating that he was convinced that Schaffer complied with the statute, and by so doing became the owner of the premises clear of the lien of the mortgage sought to be foreclosed. The decree adjudges “that the complainants have no interest or estate or encumbrance upon said lands and premises or any part thereof,” and that as to' the lands (describing them), “so far as relates to any claim thereon by or on behalf of the said complainants, the title of the defendant Karl Schaffer, in and to the same and every part thereof, is hereby determined and fixed, and declared to be good, clear of the mortgage of the complainant sought to be foreclosed.”

Such a decree is unusual in a foreclosure case. Without committing ourselves relative to its form and effect in other respects, we confine ourselves to the precise point raised by the argument and briefs, which is, did the vice-chancellor rightly decide that the tax title had been perfected so that the right of redemption originally existing in the mortgagee had been cut off?

The case was tried at the same time as Moore Securities Co. v. Schaffer, decided at the present term, and on the same oral testimony and the appropriate documents. But in the present case the defendant Schaffer produced the statutory affidavit of service of the notice to redeem by mailing. By section 59 of the Tax act of 1903 (Comp. Stat. pp. 5187, 5188) the notice and affidavits and the record thereof are presumptive evidence of the service and the facts therein stated. The same clause" has been carried into section 48 of the Tax Sale act of 1918. P. L. p. 896. We mention both acts because of the question presently to- be discussed, whether the procedure of the act of 1903 or that of the act of 1918 applies in this case. Under either act the affidavit was presumptive evidence of its contents, and there was nothing in the testimony for complainant (abstractéd in the other case) to impugn it successfully. It was admitted on both sides that the procedure to perfect the tax title had been taken under the act of 1903, and if that act applied, then the tax title stood as against the mortgage. If the act of 1918 applied, then the proceeding was defective, in that there was no publication as required by section 46 of that act. The act of 1918, chapter 237, page 883, called the “Tax Sale Revision,” is confined to sales for unpaid taxes and other municipal liens, as distinct from the imposition and levy thereof. By section 59 it is to be deemed and taken to be a remedial act and to operate both -prospectively and retro-* spectively and be liberally construed, &c. Bv section 61 inconsistent acts are repealed, but the repealer shall not affect any rights heretofore established or created; provided, however, that this section shall not be construed to prevent the continuance and completion under the laws in force at the time such proceedings were commenced of any other proceeding or proceedings not herein mentioned which may-have been or may be pending, and remain unfinished and incomplete at the time this law shall- take effect. Section 6,2 provides—

"Thin ¡ic.t shall take effect on the first, day of July, nineteen hundred and eighteen, and its provisions shall extend to proceedings on and after that date relating to any taxes, assessments for improvements or other municipal charges, heretofore or hereafter assessed, or imposed or which became a lien before or after that date.” '

The sale for taxes was in 1916; the proceedings to perfect the tax title were in 1920; so that the act of 1918 intervenes. Two questions arise—(1) By the language of the act of 1918, is it intended to apply to proceedings taken to per-feet tax titles originating in sales made before the act of 1918 (in this case 1916) ? (2) If so'. is the requirement that the notice be published as well as mailed, in the case of a non-resident owner, mortgagee, &e., unconstitutional as impairing the obligation of a contract?

We answer the first question in the negative, in view of the language of section 61. The repealer is not to affect any rights heretofore established' or created. One of those rights was to acquire a tax title by mailing a notice to redeem, &c., without any requirement of publication. Moreover, the proviso saves any proceedings under the former law not complete at the time, the act takes effect. The serving of notice to redeem is part of the .tax sale “proceeding,” which is completed only after notice is served, proof of service made and filed, and time for redemption has expired.

The purchaser correctly operated, therefore, under the act of 1903.

This conclusion renders it unnecessary to discuss the rather interesting constitutional question which would require consideration if our • answer to the first question had been in the affirmative.

The result is that the decree under appeal should be affirmed.

Foe affirmance—The Chief-Justice, Trenchard, Parker, Minturn, Black, Katzenbach, Lloyd, White, Gardxer. Van Busk irk, Clark, McGlennon, Kays, JJ. 13.

For reversal—None.


text:
    Moore Securities Company, complainant-appellant, v. Karl Schaffer, defendant-respondent.
    [Argued October 27th, 1924.
    Decided January 19th, 1925.]
    Where, under a bill to quiet title (Gen. Stat. p. 3486), complainant has established that -he is in peaceable possession of the land in question, claiming to own the same, and that his title is denied or disputed, and no suit is pending to settle the validity of such hostile claim, the burden' of establishing such adverse claim is on the person setting it up.
    On appeal from'a decree dismissing bill of complaint advised by Vice-Chancellor Ingersoll.

      Mr. Clarence L. Cole, for the appellant.

      Mr. John S. Weecoll, for the respondent.
   The opinion of the court was delivered by

Parker, J.

Complainant-appellant filed a bill to quiet title under the statute, alleging that the respondent, Schaffer, denied and disputed its title under a claim of having purchased the property at a sale for unpaid taxes and of having perfected title thereunder by service of the statutory notices, &c. Complainant admitted the tax sale, but averred that title had not been perfected thereunder, and tendered the purchase-money, with interest and costs. Defendant alleged that title had been perfected under the tax sale and that the right of redemption was gone. This was the issue at the hearing. Complainant’s evidence was directed to the proposition that the notice of tax sale and to redeem, concedeclly framed and sent out under the act of 1903, had never been received at its office in Philadelphia. Mr. Moore, president of complainant, testified that he had never seen such a notice, and his stenographer, Miss Taylor, gave similar testimony, but on cross-examination admitted that a Mr. Chew usually opened the mail and laid it on Mr. Moore’s desk. Mr. Chew was not produced as a witness. Mr. Schaffer, the defendant, was sworn, and testified that he had no recollection of mailing any particular notice, and rested on the affidavit filed in the clerk’s office pursuant to the statute. The affidavit is not before us.

It was conceded that complainant was in peaceable possession of the premises, and had the required status to file the bill. The vice-chancellor dismissed the bill, stating that “there was no convincing proof that the statutory requirement to foreclose the equity of redemption of the property had not been fully complied with.”

In so doing, he placed the burden of proof on the wrong shoulders. The rule in suits to quiet title, laid down in a number of decisions in this court and in the court of chancery, is that where the jurisdictional facts are conceded or established, tire burden of proof is on the person setting up the hostile claim to establish it by proof. Ocean View Land Co. v. Loudenslager, 78 N. J. Eq. 571; Chandley v. Robinson (New Jersey Chancery), 75 Atl. Rep. 180, no official report; Graves v. Fancher, 81 N. J. Eq. 407, 517; Lambert v. Vare, 88 N. J. Eq. 81; affirmed, 89 N. J. Eq. 211.

As there was no proof worthy of the name that defendant had perfected his tax title, complainant was entitled to stand on its conceded status and to a decree confirming the same.

The decree under review will be reversed and the cause remanded, with directions to enter a decree that complainant’s title is good, subject only to the admitted tax lien.

For affirmance—None.

For reversal—The Chiee-Justice, Teen chard, Parker, Minturn, Black, Katzenbach, Lloyd, White, Gardner, Van Burk irk, Clark, McGlennon, Kays, JJ. 13.


text:
    Michael S. Mitchell, petitioner-appellant, v. Catherine Mitchell, defendant-respondent.
    [Submitted November l0th, 1924.
    Decided January 19, 1925.]
    1. Although the opening of a final decree of divorce in chancery on the ground o£ surprise, fraud, &c., is a matter of discretion, it is a matter of judicial discretion, and, in a proper case, may be reviewed on appeal.
    2. The old equity practice in cases where it was sought to review a final decree after the time to appeal had expired, was to petition for leave to file a bill of review, but the simpler course of a direct petition to open the decree is now recognized.
    3. After time to appeal has expired, a final decree will not be opened except on the ground of newly-discovered evidence, or where some special equity appears, such as fraud or an ignorance of the proceeding! for which petitioner is not responsible.
    4. On the evidence in this case, held, that defendant knew of the pendency of the suit, evaded service of process; secured an extension of time to answer, refused to employ counsel, and waited for over a year after final decree before appls'ing to open it, and that she had shown no fraud, and neither surprise nor merits.
    On appeal from an order advised by Vice-Chancellor Lewis, whose opinion is reported in 2 N. J. Adv. R. 1S09; 9G N. J. Eg. 29.

    Appellant is the petitioner in a suit Cor divorce for desertion, in which decree nisi was entered July 12th, 1918, and final decree January 13th, 1919. On January 29th, 1919, he remarried. On February 2d, 1920, the wife petitioned for a reopening of the decree alleging, in substance, that she was never legally served with process and had no knowledge of the suit until November, 1919, and denying the desertion. Order to show cause was made on Fébruary 2d, 1920, and proofs were taken. The matter seems to have been carried along until June 15th, 1923:, when the order now- appealed from was made. It directs “that the final decree bearing date and entered in this cause as aforesaid be and the same be (sic) opened to the extent that the defendant be permitted to put in a defense, and the question of whether said decree should be wholly rescinded be reserved until the conclusion of the whole case.”

      Mr. Merrill Lane, for the appellant.

      Mr. Alexander Simpson, for the respondent.
   The .opinion of the court was delivered by

Parker, J.

1. At the outset, it is argued for the respondent on this appeal, defendant below, that the order appealed from, being-discretionary in its nature, is not appealable. Such is, of course, the general rule touching discretionary matters, but the present case is within one of the recognized exceptions to that rule. Cases in point are Watkinson v. Watkinson, 68 N. J. Eq. 632; Englehard v. Schroeder, 94 N. J. Eq. 778; In re Roberson, 95 N. J. Eq. 672.

We deem that the appeal is properly before us.

2. Appellant then urges that the procedure by petition and order to show cause was irregular and unlawful, inasmuch as the time for appeal from the main decree had expired. As to this, it might be sufficient to say that apparently no objection to this procedure was made in chancery, as noted in the opinion of Yice-Chancellor Lewis. But it will do no harm to add that we concur in his view that the practice by petition should be recognized in add of simplicity and directness of procedure, where the petition shows on its face some special equity, which, if substantiated, would avoid Bie bar of the limitation. In re Roberson, ubi supra.

3. But appellant urges, further, that no special equity to avoid the limitation appears.

This proceeding is substantially tantamount to one by way of bill of review, and the rules applicable in that class of cases were carefully enunciated by the late Judge Vroom in the Watkinson Case, 68 N. J. Eq. (at p. 642). He said: “The time of appeal having expired when this application for leave to file the bill of review was made, the petitioner was barred unless her case could be brought strictly within the exception of newly-discovered evidence, or of some special equity that would give the court the discretionary power to-make the order.” He then mentions two of such “special equities,” viz.— (1) fraud, and (2) “ignorance of the petitioner [defendant] of the existence of, a decree of divorce until after the time for appeal had expired.”. A reference to the introductory statement, supra, will show that this last is the precise ground' on which the application is rested, with an intimation of fraud in concealing from defendant the existence of the suit until after decree.

4. This brings us to the merits, and on that phase of the case wo find ourselves unable to concur in the result reached below. We have examined the evidence with care, and to us it seems rather obvious that the defendant was unwilling to live with her husband and face life with him as any normal wife would. She was unwilling to' go to California with him; she was unwilling to live with him at Union Hill; sometimes she was at Weehawken, sometimes in New York City. When the citation in divorce was issued, there was an apparently Iona fide attempt to serve it in this state. The papers were given to the sheriff, and he deputized a special deputy whose integrity is in no way impeached, to make service. Petitioner made an affidavit at the time giving both the Weehawken and the New York address correctly. The deputy made an affidavit showing repeated attempts to make service at Weehawken without result. There is strong reason to believe that defendant had wind of the suit and was evading service. Petitioner’s counsel then took out an order of publication and substituted service as prescribed by rules of court. Pursuant 1 hereto, he mailed a certified copy of the petition and order by registered mail to defendant at her New York address, using the name of his office stenographer for the return address, because he feared defendant would refuse to receive the letter, suspecting it contained divorce papers. The letter came back marked “Removed; no address,” although defendant owned the house at that address and her brother lived there. We think she knew or believed that a suit had been begun and was evading sendee. This view is supported by the telegram received by the clerk in chancery on August 20th, 1917, the last day for appearance and answer, and which reads as follows, a word is evidently omitted:

“Please [arrange?] that I have additional time to answer in Michael S. Mitchell petitioner and Catherine Mitchell defendant number 32-230 have had no papers served on me my address is 775 East Boulevard Weehawken N. J.
“Catherine Mitchell.”

Mrs. Mitchell denied sending this message, but her denial is not convincing. Either she sent it, or someone did for her. The clerk sent this telegram to petitioners solicitor, and in the end an order was made on December 17th, 1917, giving twenty days further time to answer. This, with the petition and other papers, was mailed to the Weehawken address stated in the telegram. The delay until December is explained by a letter from the solicitor to the advisory master that defendant had called on him about the suit and that he had allowed further time to answer.

He made two affidavits to this effect and was also sworn as a witness, and we see no reason to doubt his statement that she came to see him about the case and that he urged her to employ counsel, as he was going on with the suit. Any deception of the court in a matter of this kind would be ground for disbarment, and we fail to find any indication that the solicitor falsified the facts. The defendant never employed a New Jersey lawyer; she consulted a New York lawyer, wlm, of course, is not responsible to our courts, and who maintains that neither he nor Mrs. Mitchell knew a suit was in progress, but we think his memory is defective. We think she was aware o-f the notice published in the paper; that she evaded service in Weehawken and New York; that she sent or instigated the telegram to the clerk, and simply refused to recognize the existence of a suit for some reason best known to herself.'

There are other allegations of fact in the case, but we find it needless to discuss them at length. The questionnaire incident is of little consequence; petitioner was legally married at the time and answered responsively; that he desired to avoid the draft is denied. The defendant accuses him of adultery with the woman to whom he is now married, but this claim is not satisfactorily made out.

We conclude that this defendant knew of the suit and abstained from appearing and defending therein; that so far from petitioner attempting to' obtain a secret decree, he and his counsel used all reasonable efforts to make service of papers in fact., and that the present proceeding is in effect an attempt by a wife, who refused to live with her husband and deserted him, to prevent his living with anyone else, and to break up a marriage contracted by.him under the' sanction of a decree of divorce after waiting until a decree nisi had ripened into a decree absolute, and that decree and a second marriage had stood unchallenged for a year. On any sound view of private right and public policy such an attack should be discountenanced.

The order brought up will be reversed and the cause remanded, with directions to dismiss the petition, with costs, in this court and in chancery.

For affirmance—None.

For reversal—The Chiee-Justice/ Tren chard, Parker, Minturn, Black, Katzenbach, Campbell, Lloyd, White, Gardner, Van Btjsktrk, Clark, McGlennon, Kays, JJ. >14.


author: Minturn, J.

text:
    Raffaele Guangione, complainant-appellee, v. Francesco Guangione, defendant-appellant.
    [Argued October term, 1924.
    Decided January 19th, 1925.]
    1. The general rule, subject to but few exceptions, is that if the facts constituting the claim of the complainant for the immediate interposition of the court are controverted under oath by the defendant, the court will not interfere at the initial stage of the case, but the recognized exception to this rule is presented by the supplementary rule that the court will always intervene to protect the res from destruction, loss or impairment, and particularly so where it appears that the damage resulting to the complainant by a continuance of the status may prove to be irreparable.
    2. A fortiori does the necessity for such care, and precaution exist where a receiver is demanded as a matter of preliminary procedure and anterior to the trial of a cause on its merits.
    3. "Where a seventy-year-old paralytic conveyed all his property to his children under an agreement on their part to pay him $10 a week during his life, and to do other things in the agreement specified, and a bill is filed on his behalf alleging that the agreement had not been kept, and asking to have the deed declared void, and three of the defendants filed answers denying the matex’ial allegations of the bill, and a receiver was appointed to collect the rents of the property so conveyed, and the defendants were enjoined from collecting rents and from selling their interest, the order granting the injunction and appointing the receiver should be vacated as not justified until the merits of the case be determined.
    On appeal from a decree of the court of chancery.

      Mr. Edwin G. Adams, for the defendant-appellant.

      Mr. Michael J. Tansey, for the complainant-appellee.
   The opinion of,the court was delivered by

Minturn, J.

Learlike, the complainant, a seventv-year-old paralytic, divested himself of all his possessions, by conveyance, to his five children, under an agreement, upon their part, to pay him $10 a week for his board during his life, to> properly provide for him when sick, to furnish him with sufficient clothing and wearing apparel, and, final]}', at his earthly dissolution, to pay for his decent interment, and to remember his earthly resting place in the cemetery by erecting thereon a statue of Saint Leonard, presumably the titular saint of his old Italian home.

His real estate possessions consisted of an improved tract of land in Montclair, which yielded a rental of $172 per month, and a vacant plot which the children sold shortly after the con\eyance, and for which they received, net, the sum of $2,600, which they divided among themselves.

It is alleged in the bill that this agreement was not kept; that the complainant was neglected, and that three of the defendants occupied the property, paying no rent, and allowed the taxes, with interest, to stand unpaid, and the necessary repairs to the property to be neglected. The bill seeks to have the conveyance declared void as made for the purpose of defrauding the complainant of his substance and support, upon a false pretense, without competent and independent legal advice, such as the law contemplates as necessary for the proper guidance and protection of one in his enfeebled and dependent mental and physical condition.

Three of the defendants filed answers denying the material allegations of the bill, and upon this factual status, notice was given by complainant of an application for the appointment of a receiver pendente lite. As a result of the proceedings had before him, the learned vice-chancellor appointed a receiver to collect the rents of the premises, and enjoined the defendants from collecting or receiving the same, and from selling their respective interests in the locus in quo, pending the litigation, and ordered the rents paid to the receiver. From that order this appeal was taken.

It will be observed that when the order was made the issue involved as outlined by the pleadings was undetermined, and that the cause was yet to be heard upon the merits. In such a situation it was declared by this court' in an opinion by Chief-Justice Beasley, in Citizens Coach Co. v. Camden Horse Railroad Co., 29 N. J. Eq. 299, after a review of the cases, that “the general rule, subject to but few exceptions, is, that if the facts constituting the claim of the complainant for the immediate interposition of the court are contraverted, under oath, by the defendant, the court will not interfere at the initial stage of the case.” This declaration o£ practice was followed in Brunette v. Montclair, 87 N. J. Eq. 388; Harned v. Rowand, 74 N. J. Eq. 264; Aldrich v. Union Bag, &c., Co.. 81. N. J. Eq. 244; McMillan v. Kuehnle, 78 N. J. Eq. 251.

The recognized exception to the absolute enforcement of the rule is presented by the supplementary rule that the court will always intervene to protect the res from destruction, loss or impairment, so as to prevent the decree, of the court, upon the merits, from becoming- futile or inefficacious in operation, and particularly so where it appears that the damage resulting to the complainant by a continuance of the status may prove to be irreparable.

The present chief-justice tersely .stated, in McMillan v. Kuehnle, 78 N. J. Eq. 258, that such a resort should not be adopted “unless from the pressure of urgent necessity,” citing Hagerty v. Lee, 45 N. J. Eq. 255, and the present chancellor, in Aldrich v. Union Bag, &c., Co. (ubi supra), declared, citing the case mentioned, “it has been decided again and again, that a preliminary injunction should not be awarded unless from the pressure of urgent necessity, and also unless the injury to be prevented pendente lile will be irreparable.”

A fortiori, it may be observed, does the necessity for such care and precaution exist, where a receiver is demanded, as a matter of preliminary procedure, and anterior to the trial of the cause, upon its merits, since the effect of such appointment would be to transfer the subject-matter of the controversy from the hands which, in the final analysis, may prove to be its proper legal custodian, and thus pendente lite inequitably effectuate a change of legal status, which the result of the final hearing may demonstrate to be unwarranted and unjustified. In consonance with this equitable conception, the present chancellor, in Aldrich v. Union Bag, &c., Co. (ubi supra), observed, “for the same reason that a preliminary injunction will not issue, a receiver pendenle lite ought not to be appointed” at this incipient stage of the case.

Finally, additional emphasis is given to the impropriety of the order, in the fact that the affidavit annexed to the bill is in the common form, and without that specification of detail substantiating seriatim the material allegations of the bill, which requirement has been the invariable practice in equity in this jurisdiction, and without which neither an injunction can properly be issued, nor a receiver appointed. Youngblood, v. Schamp, 15 N. J. Eq. 42; McMahon v. Pneumatic Tire Co., 85 N. J. Eq. 547.

For these reasons the order appealed from must be vacated, and the cause remitted to the learned vice-chancellor for further procedure.

For affirmance—None.

For reversal—Tur Chide-Justice, Trenci-iard, Parker, Minturn, Black, Kateekbach, Lloyd; White. Gardner, Van Buskirk, Clark, McGlennon, Kays, JJ. 13.


author: Kalis ch, J.

text:
    James V. Baker, complainant-appellant, v. Joseph A. Baker et al., defendants-respondents.
    [Decided February 19th, 1925.]
    Where a decree orders land to be conveyed to A upon payment by him of $1,500, A obtains no title t'O the land until he has paid the money, and. therefore, has no standing to bring a suit for partition of the lands before such payment.

      On appeal from a decree advised by Vice-Chancellor Ingersoll.

      Messrs. Cole. & Cole, for the appellant.

      Messrs. Bourgeois & Coulomb, for the respondents.
   The opinion of the court was delivered by

Kalis ch, J.

The appellant appeals from a decree in the court below, dismissing his bill for partition of certain premises in the town of Hammonton. The facts are that prior to September 20th, 1917, the appellant was the owner of an equal undivided one-third interest in the land in question. On the aforementioned date the appellant conveyed his interest therein to Joseph A. Baker, his brother.

Subsequently, Joseph, at the request of the appellant, paid out, at the latter’s request, $1,500. The nature of the transaction was in dispute, between the brothers, and led, finally, to a bill being filed by the appellant in the court of chancery, on December 9th, 1921, against the respondents, to recover, to the appellant, an equal undivided one-third interest in the property in question. The cause came on for a hearing before Vice-Chancellor Learning, and eventuated in a decree for the appellant to this effect: “That defendant convey to complainant [appellant here] an equal undivided one-third interest in and to the premises described in the bill of complaint, free and discharged of any lien or encumbrance created by or against him since the date of said deed of September 20th, 1920, so far as complainant’s equal undivided one-third interest is concerned, upon complainant’s paying to defendant the sum of $1,500, with interest, from the date of such payment by defendant for the benefit of complainant, which sum, with interest, is made a lien upon said premises” * * *.

The appellant, so far as it appears, never complied with the condition contained in the decree, and there is no pre tense that there is anything on record, or that there was any act done in pursuance to the decree, which was, in law or in equity, equivalent to a reconveyance of the property to the appellant and the investing of title in -him, thereto.

But, notwithstanding this situation, the appellant filed a bill for partition, on May 5th, 1923, alleging that he was seized and entitled to one-third equal undivided part of the premises in question. The proof failed to establish this essential prerequisite to the filing of the bill. The appellant, admittedly, relied on the decree directing a conveyance to be made to him upon condition that he pay to the respondent $1,500, with interest, as entitling him to bring a suit for partition, but that direction depended upon tire appellant, first, complying with the condition. It is true that the appellant claims that he made a tender of the amount due to the respondent, but this is disputed, and it therefore became incumbent upon the appellant to tender the amount due, in the court of chancery and to apply there for the enforcement of its decree, freed from the condition annexed thereto. The appellant, under the facts of the case, had neither a legal nor an equitable title to the premises. Section 45 of the Chancery act (1 Gomp. Slal. p. J/£6) provides: “Where a decree of the court of chancery shall be made for a conveyance, release or acquittance of lands or any interest therein, and the party against whom the said decree shall pass, shall not comply therewith, by the time appointed, then such decree shall be considered and taken, in all courts of law and equity, to have the same operation and effect, and be as available as if the conveyance, release or acquittance had been executed conformably to such decree,” &c.

Now, it is quite plain from a reading of the decree, advised by Vice-Chancellor Learning, that no conveyance was to be made to the appellant until after he performed the condition upon which the direction for a conveyance was made to depend, and it appearing that the condition precedent had not been performed by the appellant, he took nothing by the decree.

The appellant was in no position to invoke section 45, supra, to his aid, lor the reason that the decree for a conveyance was not to go into effect until he performed the condition precedent.

The respondents, according to the terms of the decree, and against whom the decree passed, were under no legal obligation to make a conveyance. The decree, with the appended condition, does not fall within section 45, and did not operate as a conveyance. The appellant had neither, at law nor in equity, such an interest in the premises as to entitle him to maintain a suit for partition. Smith v. Gaines, 39 N. J. Eq. 545; Kloepping et ux. ads. Stellmacher, 36 N. J. Law 176 (at p. 180).

The decree of the court of chancery dismissing the bill of complaint is affirmed, with costs.

For affirmance—The Chief-Justice, Trenchard, Parker, Minttjrn, Kalisch, Black, Katzenbaci-i, Campbell, Lloyd, Van Buskirk, Clark, McG-lennon, Kays, JJ. 13.

For reversal—None.