text:
    Lockport Felt Company v. United Box Board and Paper Company.
    [Decided October 16th, 1908.]
    1. There is a general appearance by a mortgagee of insolvent, giving the court jurisdiction of it. at least for the purpose of an application by the receiver for leave to borrow money and issue receivers’ certificates .of indebtedness, to be a lien prior to the mortgage, the mortgagee having, for purposes unconnected with such application, filed its petition in the suit in which the receiver was appointed, and having in open court consented to a portion of the prayer of the receiver’s petition on such application.
    2. Unlike the case of a public service corporation, the receiver of a strictly private corporation may be authorized to borrow money on receivers’ certificates, which shall be a lien prior to that of a subsisting encumbrance only for one purpose — the preservation of the property and the expenses of realizing on it by a sale, except, possibly, the continuance of insolvent’s business, as an absolute essential to such preservation.
    3. To provide a fund for paying insurance on the property of insolvent, and interest and an installment of $13,000 on a mortgage of $188,000 on si piece of property valued at $500,000, such mortgage being subject to foreclosure in default of the payment, the receiver will be authorized to borrow money on receivers’ certificates, to be a lien prior to that of a second mortgage on that and all other property of insolvent; it being-shown that no other course can be successfully adopted to preserve the property.
    4. Part of the property of insolvent being lands out of the state, the court has no jurisdiction to authorize the issue of receivers’ certificates which shall be liens thereon, but application therefor must be made in each of the jurisdictions in which the property lies.
    5. The powers of a receiver are limited by the terms of the order of his appointment and the statute authorizing it; so that, in the absence of authority therein for his borrowing money on receivers’ certificates, which shall create a specific lien on the property in his custody, he must be specially authorized by the court having jurisdiction over him and the property.
    6. The hearing of an application by a receiver to borrow money on receivers’ certificates, the lien of which shall be superior to existing liens on insolvent’s property, must be on notice to the security holders whose rights are sought to be affected.
    On receivers’ petition for leave to borrow money.

      Mr. Sherrerd Dejme, for the receivers.

      Mr. William IT. Carey and Mr. Boston (of the New York bar), for the Trust Company of America.
   Howell, V. C.

In July, 1908, this court appointed receivers of the property and assets of the United; Box Board and Paper Company, a New Jersey corporation, which is now in process of being wound up under the statute. The company was engaged in the business of manufacturing box board at eighteen mills scattered about the United States and situated within several jurisdictions. Among the others it owned a mill in Indiana called the Wabash mill, which was valued in a recent report made to the court at $500,000, but which has been spoken of in other proceedings before’ the court as having a value much larger. At the time it was conveyed to the box board company it was subject to a mortgage made to a trustee to secure an issue of bonds aggregating $200,000. There is an agreement in the mortgage that beginning with the present year tire company would redeem a certain number of the bonds secured by this mortgage at stated periods. On September 1st, 1908, the company was under obligation by the terms of the mortgage to purchase and retire $13,000 of these bonds, it having previously and before the receivership redeemed twelve of the bonds aggregating $12,000, so that now the mortgage stands as security for $188,000. The interest on these bonds matured also on the first day of September. The company is given three months after the fh’st of September in which to pay this interest and redeem the thirteen bonds. If a default occurs at the expiration of the three months the whole mortgage money becomes at once due and payable. The insurance policies on all the company’s property have recently expired and there is required upwards of $24,000 to pay the premiums in order to effect a renewal of the policies for another term. The receivers are without funds for these purposes, and they now anulv to the court for leave to borrow a sum aggregating-ap-wards of $42,000 for the purpoie^^irsi, of paying the overdue insurance, premiums on the policies of insurance; second, of paying the arrears of interest on the underlying mortgage on the Wabash mill; third, of raising the sum of $13,000 to redeem bonds of the Wabash company, as is required by the terms of the mortgage. The whole property of the company is covered by a mortgage to the Trust Company of America, a New York corporation, to secure an issue of bonds made by the company, aggregating about a million and a quarter dollars. This is a second mortgage on the Wabash mill. The application includes a prayer for leave to issue receivers’ certificates of indebtedness to the amount necessary to be raised, and the making of such certificates representing such indebtedness a lien on the property of the company prior to the mortgaga-beld by the Trust Cóffipanv ffiíNGñérica. but so far as the Wabash property is concerned subsequent to the underlying mortgage thereon. The Trust Company of America appeared by_counsel and in open court assented to the prayer of the petition to raise money with which to' pay the insurance ^^rtótimsTañd to that extent to displace the trust company’s mortgage, but as to- the interest on the Wabash mortgage and the redemption of the thirteen bonds required by the mortgage, counsel for the Trust Company of America deny the jurisdiction of this court over the trust company, and as to these two- sums deny the right of the court to displace the mortgage held by it thereby. The quesH tion, therefore, is whether this court may authorize the borrow- j ing of money on receivers’ certificates of indebtedness to meet the interest- and the sinking fund appertaining to the Wabash ( mortgage and in so doing displace the mortgage of the Trust i Company of America, not only without its consent, but against j its protest. The objection made by the Trust Company ox America that this court has no jurisdiction over it, and therefore cannot make the order prayed for, must fail for two- reasons — first, because the same company appears by the records of the court to have filed its petition in this suit for purposes unconnected with the present application, seeking affirmative relief and without- any permission to appear specially for the purpose, and second, because the appearance on this application is general inasmuch as it consents in open court to a portion of the prayer of the petition. These steps in the cause must be held to be a general appearance, at least for the purposes of the pending motion.

If there were no specific and fixed liens and encumbrances upon the property of the company there could be no question but that the court could authorize the receivers to borrow moneys for proper purposes and make the securities therefor first liens upon the property in the receivers’ custody. The difficulty arises in this class of cases in the desire or attempt to make this sort of securities a lien prior to existing encumbrances on the specific property.

With régard to corporations of a guasi-publie nature, suph . , as railway and telegrapli companies and other corporations which belong to the public service class, there appears to be little difficulty either on authority or in reason as to the right to displace .'.'.prior liens by receivers’ certificates. These corporations, their stockholders and bondholders, hold subject to the public right, and if corporations of this class become insolvent and thereby fail in the. performance of their duty to the public, the court has the right to pledge the property and all the interests of the owners and lienors to raise money with which to enáble tire receivers to carry out the public duties and obligations of the corporation. It will be sufficient to cite on this point the opinion of Mr. Justice Bradley in the supreme court of the Hnited States, in the case of Wallace v. Loomis, 97 U. S. 146. See, also, Fosdick v. Schall, 99 U. S. 235. The cases as to this class of corporations are numerous and will be found collected in 3 Cook Corp. §§ 876, 877. The same rule prevails in the English courts. Greenwood v. Algesiras Railway, 2 Ch. 205; 63 L. J. Ch. 670 (1894).

There is, however, in principle and on authority, a wide dis-f tinction between the power of the court to authorize the displacement of subsisting mortgages and liens in the case of public corporations and its power in the case of mere private enterprises! which have taken the corporate form. The general power to authorize the issue, of receivers’ certificates of indebtedness for the purpose of continuing a business which exists in the case of a _ púlilic ^corporation does not exist in the case of a private corpo- \ ration. When a receiver is appointed of a private corporation^ 'under our statute the court may authorize him to continue the! business temporarily, but with the purpose of winding up, pro- ' vided the receiver has in his possession sufficient assets to enable him to go on; but if he should find it necessary to borrow money with which to continue the business, the rule undoubtedly is that he shall not be authorized to issue receivers’ certificates to raise money therefor which shall displace the lien of a subsisting en- / cumbrance. The reason for this is very obvious. It would be a gross violation of that claus'e of the federal constitution wliich .prohibits the states from passing laws violative of the obligations of contracts. There -is, however, one circumstance which willi justify the court in issuing these certificates and displacing priori liens thereby. That occurs in a case in which the money is reJ) quired not for the purpose of operating the business buj>-.fófithi| purpose of saving-the praperty^ from destruction. A brief ex-' amination of the cases will demonstratethé validity of this position. In Porch v. Agnew, 70 N. J. Eq. (4 Robb.) 328, the question came under the consideration of Vice-Chancellor Grey; the suit related to the receivership of a large and valuable frame hotel-property at Atlantic City. The principal value of .the property was in the building, and there was no income from it with which the receiver could pay insurance premiums and the services of a watchman, which were indispensable under the terms of the insurance policies. The bondholders opposed the receiver’s application, but the vice-chancellor granted it upon the principle that it was necessary for the preservation of the property. A similar application was dealt with by the court of appeals of New York in the case of Raht v. Attrill, 106 N. Y. 423. There a receiver had been appointed for the purpose of winding up an insolvent corporation whose property consisted largely of an unfinished hotel building at Rockaway Beach. The receiver sought authority to borrow money for the purpose, among other things, of paying off workmen who in default thereof had threatened to burn the building. The court of appeals denied the power, of the court of first instance to supersede the lien of the first mortgage to raise money to pay the laborers, and said, “the act of the court in taking charge of property through a receiver is attended with certain necessary expenses of its care and custody, and it has become the settled rule that expenses of realization, and also certain expenses which are called expenses of preservation, may- be, incurred under the order of the court on the credit of the property, and it follows from necessity in order to the effectual administration of the trust assumed by the court that these expenses should be paid out of the income, or when necessary out of the corpus of the property before distribution or before the court passes over the property to those adjudged to be entitled.” The court held further that there was no paramount necessity -arising out of the fact that the workmen had threatened to burn the building; but that this situation must be dealt with by the ordi[hary legal methods. In Karn v. Rorer Iron Co., 86 Va. 754; 11 S. E. Rep. 431, the property in question consisted of a mine which had no marketable valpe independent of a railroad constructed and used by its owner for the transportation of ore. The court authorized its receiver to protect the title to the railroad and to repair it, and to borrow money on certificates which should be a first lien on all the company’s property. The court of appeals gave this reason for holding the action valid: “It was necessary to raise money in some way to preserve the property from destruction or serious injury, and to put it in salable condition, and the only practical mode of accomplishing that fact was by issuing receivers’ certificates.” In Dalliba v. Winschell, 11 Idaho 364; 82 Pac. 107, it was said that courts of equity have power to direct their receivers to care for, protect and preserve the property and to decree that the charges and expenses thereof be prior and preferred liens over other subsisting liens, mortgages or encumbrances, but. to go bejxmd the preservation of the property and issue certificates for money to be used in paying running expenses is beyond the power of the court. The supreme court of Maryland, in an opinion by Mr. Justice McSherrjr, in Hooper v. Central Trust Co., 81 Md. 559, goes further. He sa)^: “When the property of private corporations or of individuals has been placed in the hands of a receiver, all expenses for safekeeping and preservation are properly payable out of the income, if there be any, or, if there be none, then out of the proceeds of the corpus of the estate when sold; but this necessary power by no means includes authority in such instances to allow the creation of liens through the medium of receivers’ certificates' which will take priority over existing antecedent liens. Extensive as are the powers of the courts of equity, they do not authorize the chancellor to thus impair the force of solemn obligations and destroy vested rights.”

Other cases in the state courts are: Osborne v. Bigstone Company, 96 Va. 58; 30 S. E. Rep. 446; International Trust Co. v. United Coal Co. (Colo.), 60 Pac. 621; Merriam v. Victory Mining Co., 37 Oreg. 321; 60 Pac. 997.

The point has received the largest illustration in the'"federal jurisdiction, and there are'many cases in the circuit court of tlie’' United States in the several circuits in which the doctrine above stated has been adhered to. In Farmers’ Loan and Trust Co. v. Grape Creek Coal Co., 50 Fed. Rep. 481, the subject-matter of the suit was the foreclosure of a mortgage on the property of a coal mining company. The receiver sought an order authorizing him to issue receivers’ certificates which should be a first lien on the trust property to enable him to. pay taxes then due, to take up certain outstanding certificates, and to continue the operation of the mine. Gresham, circuit judge, quotes the words used by Judge MeSherry in the Maryland Case, and after discussing the right of the court to deal with public corporations he proceeds: “Private corporations owe no duty to the public, and their continued operation is not a matter of public concern. It is only against railroad mortgages that the supreme court of the United States has sustained orders giving priority to receivers’ certificates representing particular indebtedness, and, as already stated, then only on principles having no application to a mortgage executed by a private corporation owing no duty to the public.”

Tn the ease of Fidelity Insurance Trust and Safe Deposit Co. v. Roanoke Iron Co., 68 Fed. Rep. 623, the complainant was foreclosing a mortgage on the property of the defendant, a private corporation engaged in the production of iron, a receiver was appointed who petitioned for leave to issue receivers’ certificates and to borrow money thereon for the purpose of carrying on the business of the company. The prayer of the petition was denied upon the principle that it was beyond the authority of the court to authorize the receiver of a private corporation to issue certificates which should displace the lien of a subsisting mortgage for any such purpose. In the case of Hanna v. State Trust Co., 70 Fed. Rep. 2, the court appointed a receiver for a private corporation engaged in business of irrigation and colonizing arid lands. In a suit brought to foreclose a second mortgage, it was held that the court appointing the receiver had no authority to authorize its receiver to issue certificates to raise money to carry on the business of the insolvent corporation and improve its lands already covered by a mortgage. In Doe v. Northwestern Coal Co., 78 Fed. Rep. 62, it was held that receivers’ certificates issued by the receiver of a private corporation cannot be made a charge upon the assets of the corporation in preference to existing liens and as against lienors who have not given their consent thereto.

In International Trust Co. v. Decker, 152 Fed. Rep. 78, the insolvent company, a Maine corporation owning property in Alaska, mortgaged- the same to the complainant, a Massachusetts corporation. Proceedings were taken to foreclose the mortgage, in which proceedings the receiver was authorized to issue certificates on which to borrow money with which to carry on the company’s business, andi they were by their terms made a first lien upon the property of the corporation. It was held by the circuit court of appeals that the mortgage could not be displaced, following Baltimore Building and Loan Association v. Alderson, 90 Fed. Rep. 142, in which the circuit court of appeals said: “In case of private corporations the court cannot authorize the issue of receivers’ certificates for the purpose of improving, adding to or carrying on the business of the company without first having the consent of the creditors whose liens would be affected thereby.”

The English rule will be found in the judgment of Mr. Justice ICekewdch in Securities and Properties Corporation v. The Brighton Alhambra, 62 L. J. Ch. 566; Kerr Rec. 195.

From the cases above cited and from the constant course of J practice in this state the rule may be dedüced that in case of /' private corporations the court may authorize its receiver to borrow money upon the faith and credit of all the property of the corporation and authorize the issuing of securities which shall displace all prior liens and encumbrances, but only for one purpose, viz., the preservation of the property and the expenses of . realizing upon it by a sale. This necessity should be imperative .-And paramount and under no other circumstances can a court ^justify itself in attempting to undermine prior liens,

The rule which forbids the displacement of prior liens by Receivers’ certificates, at all events, in the case of private corporations, is not the reasonable rule. It goes too far. It may' well be that one of the chief reasons for appealing to the court to appoint a receiver is that the property may be preserved from spoliation or destruction, and if, after the court shall have assumed to care for the property, it finds that there is no income to support it, and that the court has no power to pledge the property for its own preservation or realization, the original action in appointing the. receiver would be futile.

Under no circumstances would the court be justified in authorizing its receiver to borrow money and make the obligation thereof a first lien on tlie property of a private corporation by the displacement of existing liens for the mere purpose of continuing the business in which the company was engaged, unless possibly in a case in which it satisfactorily appeared that the continuation of the business was absolutely essential to the preservation of the property in the receiver’s custody. In the case of a private corporation this necessity is made the criterion.

In addition to the limitations thus set to the power of the court it may be well to add that in every case the power now.,, appealed to is an extraordinary one and is liable to abuse unle's'sexercised with the utmost caution. The court should be satis- ¡ fied by a preponderance of circumstances that no other course could be successfully adopted, and that practical ruin would ensue if the authority were withheld. All the facts should be exhibited which make the necessity apparent; all the. parties ' affected should be notified and a full hearing accorded to all objectors.

I think that the required necessity exists in this case. As to v the payment of the insurance premiums, that may be dismissed'! with a word. It is only common prudence to provide a fund for, that purpose. Porch v. Agnew, supra.

As to the Wabash mill, it appears that, unless the interest on the bonds and the sinking fund so-called shall be met within three months from September 1st, the holders of the underlying' bonds may foreclose their lien. In the latest report of the condition of tlie company this mill is valued at $500,000; it has been carried on the books of the company at a very much higher valuation. It is subject to a mortgage of $188,000, leaving a-substantial equity, which ought to be protected for the benefit of tbe bondholders under the second mortgage who are represented by the Trust Company of America. In case a default should happen the underlying mortgage would be foreclosed, and in the present condition of' the trust the receivers would have no money with which to protect the equity at the sale, and thus the stockholders and bondholders of the box board company would lose the entire property.

I therefore think that the prayer of the petition should be granted and that the receivers should be permitted to issue certificates to the amount required for the purposes above mentioned, which shall bear interest at a rate not greater than six per cent, per annum, and be disposed of at not less than their par value and be made a lien on all the property of the company in the possession or under the control of the receivers prior to the mortgage held by the Trust Company of America and prior to the claims of the bondholders secured thereby, i>ut subject and subsequent to the underlying mortgage of $188,000 now on the “ Wabash mill. Inasmuch, however, as this court has no juris-; diction to authorize the issue of receivers’ certificates which shall'*' be a lien on the lands in another state (Poole v. Farmers’ Loan and Trust Co., 7 Tex. Civ. App. 334), it will be necessary tS,' apply for and obtain a similar order in each of the jurisdictions-in which property of tbe company lies.

There are some questions of practice which may well be r£?C ferred to here. Counsel will find in many of the cases that' receivers have undertaken to borrow money on receivers’ certificates without the authority of the court. It is, perhaps, unnecessary to say that in this jurisdiction a receiver has no such power by virtue of his office, nor has he any power to issue any form of evidence of indebtedness which shall create a specific lien on the property in his custody as an officer of the court. He may only do so by the formal enabling decree of the court which has jurisdiction over the receiver and over the property. It may~~7 be stated as a general rule that a receiver’s powers are limited by the terms of the order of his appointment or by the statute which authorized it. Runyan v. Farmers’, &c., Bank, 4 N. J. Eq. (3 Gr. Ch.) 480; Verplanck v. Mercantile Insurance Co., 2 Paige 438; Quincy, &c., Railroad v. Humphreys, 145 U. S. 82; Sm ReC. § 25. No receiver, therefore, woulcl be justified in'incurring any indebtedness on the faith of the property and in issuing obligations therefor unless the act were sanctioned by the order of the proper court. Vilas v. Page, 106 N. Y. 439. It must likewise be remembered that the court has no authority to hear an application of this nature unless notice thereof shall have been given to all the security holders whose rights are sought to be affected. As has already been noted, ^chjufifiee-was-^wen in.' this case. , Laughlin v. United States Rolling Stock Co., 64 Fed. Rep. 25; Third Street Railway v. Lewis, 79 Fed. Rep. 196.


source: Caselaw Access Project

author: Walker, V. C.

license: Public Domain

text:
    August C. Durling v. John V. Stillwell et ux., et al.
    [Decided May 21st, 1908.]
    Where one is in possession of mortgaged premises under an agreement to purchase and pays part of the consideration money, he is entitled to be reimbursed his payments out of the surplus arising upon a sale under foreclosure, in preference to judgment creditors whose judgments were recovered subsequent to the execution of the contract of purchase and entry into possession by the vendee; provided he had no actual notice of the entry of the judgments before making any payment, or, if he had such notice, still he would be entitled to the surplus if he were under constraint to make payments on account of the' purchase-money by reason of the forfeiture of what he had already paid iri the event of his default.
    On bill to foreclose. On application for surplus money.

      Mr. Peter Stillwell, for the defendant Nathaniel S. Daniel, petitioner for surplus money.

      Mr. George H. Large, for the defendants Thomas Moore and others, judgment creditors.
   Walker, V. C.

By tlie interlocutory decree in this cause it was referred to J. L. Connet, Esq., one of the masters of this court, to ascertain and report the amount due to the complainant upon the mortgage held by him and also the amount due, if anything, to the answering defendants upon their respective judgments, and to report accordingly, and also to ascertain and report the order and priority of the several judgments, respectively. The master reported on November 22d, 1907, what was due to the complainant for principal and interest on his mortgage on that' day, and also the amounts clue to the several judgment creditors of the mortgagor, respectively, and final decree was thereafter duly entered and a writ of fieri facias was therein ordered to be issued to the sheriff of the county of Hunterdon, to whom the same was afterwards delivered,. and who made sale of the mortgaged premises described in the bill of complaint, and after the payment and satisfaction of’ the complainant’s mortgage, principal, interest and costs, there remained in the hands of tire sheriff $759.74, the surplus money arising from the sale of the mortgaged premises, which would be payable to the judgment creditors of the mortgagor, unless the claim therefor of the defendant Nathaniel S. Dankel is valid.

The complainant’s mortgage was made on February 2d, 1897, and recoi'ded three days afterwards. Prior to the making anrecording of this mortgage and in November, 1896, the mortgagor entered into a written agreement with N. S. Dankel, which was not acknowledged until October 8th, 1898, and which was recorded on that day. ’ The bill alleged that by virtue of the agreement referred to, which was an agreement for sale, Dankel and his wife claim some interest in the premises, but that any interest they had was subsequent and subject to the lien of the complainant’s mortgage. The}', Dankel and wife, did not answer and the bill was taken as confessed against them.

The defendant Dankel has filed a petition for the surplus money in this cause upon the ground that his contract of purchase and his entry into possession of tire mortgaged premises pursuant thereto, from the date of the recording of the agreement, namely, October 8th, 1898, and his continued possession thereof tip to the time of the filing of the petition, March 5th, 1908, which was after the time of sale, and his having, during all that time, and up. to the time of the service upon him of the subpoena, to answer in this cause, made all of the payments required by the terms of the contract (leaving a balance of purchase-money due, amounting to $1,260), entitles him to, receive the surplus moneys arising from the sale.

By the terms of the contract above mentioned, which was before the court, ’Stillwell agreed with Dankel to sell him a house and lot containing forty-four-hundredths of an acre, more or less, being part of the mortgaged premises, for the sum of $1,-900, to be paid in monthly payments of not less than $5, with interest payable monthly on the balance, and if he, Dankel, should fail to make the payments aforesaid, then he should surrender possession of the property to. J. Y. Stillwell, and when he should have paid' the sum of $1,900, with interest, then the property should belong to him, and Stillwell should deliver him a deed for the premises. Endorsements of the receipt of payments on account, and interest, attached to the agreément, indicate that the payments were properly made. In fact this is conceded. While the petition does not aver that'Dankel had no notice of the judgment recovered against John Y. Stillwell, the mortgagor, which ranged from September 11th, 1900, to April 27th, 1906, that fact also was conceded upon the hearing of the' application for surplus money.

In applying for an order to pay the surplus money into court, counsel for Dankel pointed out that while the master reported upon the priority of the several judgments as between themselves, the bill made no allegation in that respect, and that the master’s report with reference to that subject was a violation of rule 24 of this court, which provides that where the bill in a foreclosure suit shall be ordered to be taken as confessed against the defendant, no report or decree shall be made by which his rights or claims are postponed to those of any other defendant unless the priority of the rights or claims of such other defendant and the facts upon which it depends are distinctly set forth in the bill. Now, there is no allegation in the bill as to any priority of the rights of tire judgment creditors over the interest of 'Dankel in the mortgaged premises. The allegation in respect to both interests is that they are subsequent to the mortgage of the complainant, and no reference is made as to any claimed priority'as between themselves. The master took no notice of DankeFs interest in the mortgaged premises, and properly so, for he was not directed to report upon it.

Dankel now claims that he is entitled to- all of the surplus money, as he was the- equitable owner of the mortgaged premises at the time of the foreclosure sale to the extent of his investment under his contract of purchase, to the exclusion of the judgment creditors, whose judgments against the mortgagor were all recovered subsequent to the recording of his contract of sale and entry into possession of that part of the mortgaged premises, which was comprehended under tire terms of his agreement. In support of his contention his counsel cites Ward v. Cooke, 17 N. J. Eq. (2 C. E. Gr.) 93, and Moyer v. Hinman, 13 N. Y. 180.

The first case, Ward v. Cooke, is applicable -on principle. In •that case it is held that a mortgage given to secure future advances, duly registered, is good not only as against the mortgagor, but is entitled to- priority over subsequent encumbrances for all advances made prior to- actual notice of the subsequent encumbrance; that if the first mortgagee has knowledge of the existence of a second mortgage upon the estate, he cannot give further credit upon his prior mortgage, provided it is entirely optional with him whether to make further advances or not. Now, I cannot see that one who- has advanced money upon a mortgage securit), and who is to make further advances thereunder, is in any different situation from one who has advanced money upon a contract of purchase, and is to make further advances under the contract. And in the case under consideration it will be remembered that if Dankel stopped paying installments of the purchase-money he would forfeit what he had paid. It was- not entirely optional with him whether to make further payments or not, but he was, in that respect, under constraint. The ease of Ward v. Cooke, therefore, is, as I have said, an authority for DankeFs position.

The second case, Moyer v. Hinman, which was followed in Smith v. Gage, 41 Barb. 60, is on all fours with the case at bar. In that case (Moyer v. Hinman, 13 N. Y. 180) the syllabus reads as follows:

“1. The lien of a judgment on lands is subject to the equitable rights of a party in the occupation thereof, under a prior contract to purchase the same from the judgment debtor.
“2. The docketing of the judgment is not notice thereof to such purchaser ; and payments subsequently made by him to the judgment debtor pursuant to his contract, without actual notice of the judgment, are valid as against its lien upon the land.
“3. And where, while the purchaser of land by contract was in possession, a judgment was recovered against the vendor, and the land sold on an execution issued thereon and bid off by the plaintiff in the judgment, who transferred the sheriff’s certificate to a third person, to whom the sheriff executed a deed; and the purchaser, after the sale on execution and before the sheriff conveyed, without actual notice of the judgment or the proceedings thereon, made payments pursuant to his contract to the judgment debtor — Held, in an action by purchaser against the grantee in the sheriff’s deed for a specific performance of the contract, that such payments were valid, and that the latter was bound to convey the land on being paid the amount due on the contract after applying the payments made to the judgment debtor.”

The principle stated in Moyer v. Hinman was approved by Vice-Chancellor Green in Murch v. Smith Manufacturing Co., 47 N. J. Eq. (2 Dick.) 193-196. The facts in the case of Murch v. Smith Manufacturing Company bear no relation to those in Moyer v. Hinman, but that ease (Moyer v. Hinman) was appositely cited by Vice-Chancellor Green as authority for the principle for which it stands.

I am clearly of opinion that the petitioner, Dankel, is entitled to the surplus money, and will so advise. On this application neither party is entitled to costs against the other.


text:
    The Diocese of Trenton v. John F. Toman et al.
    [Decided June 22d, 1908.]
    1. A right of way appurtenant to a lot cannot be used for the purposes and benefit of another lot to which no .such right is attached, even though such other lot be adjoining and within the same enclosure tind in the same ownership as that to which the easement belongs.
    2. If a lot to which a right of way appurtenant is attached be subdivided, each subdivision is entitled to all legitimate rights, by way of easement, which appertain to the entirety of the original lot.
    3. An automobile is a carriage within the meaning of a covenant in a deed reserving a strip of land for a carriage-way forever.
    4. An automobile garage is not a nuisance per se.

      5. Facts examined, and held not to show that a certain automobile garage is so conducted as to constitute a nuisance.
    On bill, answer, replication and proofs.
    The controversy in this case relates to the extent of an easement in an alleyway leading from the easterly side of North Warren street, in the city of Trenton, between the property of the complainant on the north, the St. James Day Nursery, No. 136 North Warren street, and the Turkish Bath House on the south, No. 132 North Warren street. The easement .in question was reserved in a deed from Samuel Evans and wife and the executors of Joseph H. Reading to William F. Pitcher, March 30th, 1858. The Trenton Turkish and Russian Bath Company has succeeded to the title of Pitcher, as to part of No. 132 North Warren street, but is not a defendant and is not concerned in the present controversy. The defendants, the Toman brothers, are now the owners of the rear portion of the Pitcher tract, No. 132 North Warren street, which also abuts on the alleyway. They also own No. 130 North Warren street, adjoining No. 132 on the south, which lot, No. 130, runs back to the rear line of the portion of No. 132, which they own, and together the two lots form an L.
    The defendants, on acquiring the title to the land in the rear of 132 North Warren street, which was part of the Pitcher lot, razed an old barn and fences which existed thereon, and, upon acquiring the premises No. 130 North Warren street, they razed the building on the rear thereof, thus obliterating the division line between the two properties, and erected on both of them a two-story automobile garage, covering the entire rear of No. 132 and a portion of the rear of No. 130, which building is used for the repair and store of automobiles. No. 130 North Warren street, which the defendants own, and upon a portion of which they have erected a portion of their garage building, was never parcel of either of the properties between which the alleyway is situate. When the defendants were about to commence the erection of their garage building, the complainant served written notice upon them that it would dispute their right to use the alleyway as an entrance to their garage.
    The bill alleges, and the answer admits, that the garage building is so constructed that persons entering the same may, at pleasure, leave by way of either entrance, and not only that they may, but that they do use both entrances for ingress, egress and regress. The bill further alleges that the defendants, their customers and patrons, are using the alleyway for the purpose of entering and leaving the garage with their automobile machines at all hours of the day anfl night; that the machines are propelled by means of power generated from gasoline, and when in operation, they emit the odor of gasoline and volumes of smoke which permeate the atmosphere and enter the doors and windows of the complainant’s dwelling, the side of which looks out upon the alleyway through some thirty windows and doors; that the automobiles while passing through the alleyway constantly make a variety of loud, disturbing and objectionable noises, interspersed with frequent explosions of gases, generated in the machines, and that the constant mechanical noises of machinery, while in motion, affect and disturb the peace, quiet and comfort of the complainant’s building, and create a .nuisance. The bill further alleges that the defendants, by the joining of their two properties, have increased the traffic over the alleyway, not only from the lands to which the alleyway is appurtenant, but also from the other lands, 130 North Warren street, whereby they have increased the servitude of the alley, which is not, never was, and cannot be made servient to the premises No. 130 North Warren street, or any part thereof; that the defendants not only have increased the servitude by extending the limits of the land, and by increasing the traffic, but by subjecting the alleyway to the burden of an easement in favor of automobiles when 'the right reserved was for carriages drawn by horses- only.
    The defendants admit, practically, all of the allegations of the complainant’s bill, and such denials as they make are quite immaterial for present purposes, because, coupled with their denials, they claim the right to do all of the things which the complainant alleges they are doing.
    The alleyway in question was carved out by the reservation in the deed from Evans and wife and the executors of Reading, and Pitcher, above mentioned, in 1858, and reads as follows:
    “The whole of the vacant lot between the brick house hereby conveyed, and the house on the said lot late of said Philip F. Howell, deceased, which said last mentioned house is now occupied by George G. Roney is to be appropriated for a carriageway forever, for the benefit of the two properties between which it is situate, and running back to within thirty-five feet of the rear line, which said carriageway or alley is to be kept free at all times from all description of rubbish whatever, not anything to be thrown therein, but clear water, and each of the beforementioned properties, to wit, the house and lot of land hereby conveyed, and the house and lot of land where the said George F. Roney now resides, to have a private side alley, with gates affixed to them, and double gate is to be made to the entrance of the wagon or carriage alley, which said alterations or improvements are to be made as soon in the ensuing spring or summer as the parties to this deed may deem expedient. The work thereof to be done by the said William F. Pitcher, and each party to pay a .proportion of keeping the same in repair.”
    Tbe complainant insists and contends that the defendants have no right to use the alleyway as a means of ingress, egress and regress to their garage with automobile machines, because— first, the use which was to be made of the alleyway and which is the subject of the express reservation in the deed was for a carriageway only for the benefit of the two properties between which it is situate; second, because the defendants are now rising it in connection with their other property, which was never a part of either of the two-properties between which the alleyway is located; third, because the use being restricted to a carriageway, the servitude only extends to carriages or vehicles drawn by horses, the term carriage, as used by the parties to the conveyance, not extending to automobiles, and fourth, because the defendants are creating a nuisance by using the alleyway for, an automobile passage.
    The foregoing statement of the situation of the parties and the premises in question may be better understood by reference to the diagram hereto annexed. The properties of the complainant, the Turkish and Eussian Bath Company, and of the defendants, are thereon delineated and given their appropriate numbers on North Warren street. The alleyway in question is labeled with the word alleyway, and, as will be seen, it lies between the property of the complainant on the north and the Trenton Turkish and Eussian Bath Company on the south, with the defendants’ rear portion of 132 North Warren street bounding upon the alleyway for a short distance in the extreme rear thereof. A is the alley leading from North Warren street to the garage on south side of the defendants’ property, No. 130 North Warren street. B is the doorway into the garage from the alley A. 01 is that part of the defendants’ property covered by the garage building which comprises the rear of No. 130, and G 8 is that part of the defendants’ property covered by the garage building which comprises the rear of No. 132, and which (C 8), it will be remembered, is the rear portion of the Pitcher lot for the benefit of which and the complainant’s lot the alleyway was originally carved out. D is the doorway into the alleyway from that part of the garage building which bounds upon the alleyway.

      Mr. Peter Baches, for the complainant.

      Mr. Richard C. Chamberlain and Mr. Hugh H. Hamill, for the defendants.
   Walker, V. C.

The complaipant’s bill prays for an injunction restraining the defendants, the Toman brothers, from using the alleyway between the lands of the complainant, No. 136 North Warren street, and the lands of the bath company, No. 132 North Warren street, as a passageway for automobiles entering or leaying their garage building, through which, admittedly, they have the right of ingress, egress and regress over the alleyway for horse-drawn vehicles in connection with their lot in the rear of the bath company’s premises, and which was formerly a part of the same lot.

The first and second grounds upon which the complainant rests its claim to an injunction are really one, and may be succinctly stated as follows: Because the defendants have a right of way only through the alleyway as appurtenant to their lot in the rear of No. 132 North Warren street for carriages drawn by horses.

If, as urged, the defendants have no right to use the alleyway for vehicles which enter their garage through the alley on the south side of their property, No. 130 North Warren street, they are, by so using it, subjecting the servient tenement, namely, the alleyway, to an additional and unauthorized burden, which is illegal and should be restrained. That the law is with the complainant on this question seems to me to be perfectly well settled by a long line of decisions both in England and in this country.

In Allan v. Gomme, 11 Adolph. & E. 759, it was held that a conveyance to A of certain premises reserving a right of way and passage over the locus in quo to a stable and loft in the same and a space or opening under the loft, to be used in common by both occupiers as tenants thereof had been accustomed to theretofore use them, that the reservation did not authorize B, who afterwards built a cottage on the site under the loft, to use the passage as a way to the cottage.

Lawton v. Ward, 1 Ld. Raym. 75, holds that under a right of way to a particular place a man cannot justify going beyond that place.

Colchester v. Roberts, 4 Mees. & W. 769, involved a question of pleading, but Baron Parke observed (at p. 773) : “A license, therefore, to use a way to and from Black Acre,- would not have included permission to go to or come from beyond.

One of the older cases, and probably the leading one in England upon this question, is that of Howell v. King, 1 Mod. 190, which was in trespass for driving cattle over the plaintiff’s ground. It was thus reported:

“The case was: A has a way over B’s ground to Black Acre, and drives his beasts over B’s ground to Black Acre and then to another place lying beyond Black Acre. And whether this was lawful or no, was the question upon a demurrer. It was urged that when his beasts were at Black Acre he might drive them whither he would. Roll. 391 Nu. 40, 11 H. IV. 82; Brook, tit. Chimin. On the other side it was said that by this means the defendant might purchase a hundred or a thousand acres adjoining to Black Acre, to which he prescribes to have a way: By which means the plaintiff would lose the benefit of his land: and that a prescription presupposed a grant, and ought to be continued according to the intent of its original creation. The whole court is agreed to this. And judgment was given to the plaintiff.”

Davenport v. Lamson, 21 Pick. 72, was this: By the partition of a farm the right of passing and repassing across an eight-acre lot, belonging to the plaintiff, became appurtenant to a three-acre lot belonging to the defendant, who also owned a nine-acre lot which was beyond the three-acre lot, but was adjacent to and not separated from it by any fence. The defendant having-loaded his cart with produce taken in part from each of his lots passed with it from the three-acre lot over the plaintiff’s close,- and it was held that the defendant had no right to use the way as a way from the nine-acre lot, although, in so doing, he passed last from his three-acre lot onto the plaintiff’s close, and that trespass would lie for such abuse of the defendant’s right.

In Evans v. Dana, 7 R. I. 306, it was held that an express grant of the right of access to and to take water from a well in close No. 1, as appurtenant to close No. 4, confers no such right upon close No. 3 adjoining, because not the same ownership as No. 4, as to authorize the owner to pass through his close, No. 4, to the well, and take water therefrom for the use of his close, No. 3. The court observed: In regard to the right claimed to exist as appurtenant to close No. 3, to take water from the plaintiff’s well over and across No. 4, it is sufficient to say that an easement is a burden upon the servient, and a right only in the dominant estate, and when created and declared by an express grant, cannot be extended beyond its plain language or clear intent. The easement appurtenant to close No. 4 confers, therefore, no rights upon close No. 3, and it makes no difference that they are now owned by the same party. Evans v. Dana, 7 R. I. 311.

A right of way appurtenant to a lot cannot be used for the purposes and benefit of another lot to which no such right is attached, even though some other lot be adjoining and within the same enclosure with that to which the easement belongs. Farley v. Bryant, 32 Me. 474. See, also, Albert v. Thomas, 73 Md. 182; French v. Marstin, 32 N. H. 316; Webber v. Vogel, 159 Pa. 235; Greenmount Cemetery Company’s Appeal, 4 Atl. Rep. 529 (Supreme Court, Pennsylvania); Coleman’s Appeal, 62 Pa. St. 252; Shroder v. Brenneman, 23 Pa. St. 348; In re Private Road, 1 Ashm. (Pa.) 417; Greene v. Canny, 137 Mass. 64; Brightman v. Chapin, 15 R. I. 166; Shaver v. Edgell, 48 W. Va. 502; Springer v. McIntire, 9 W. Va. 196; Reise v. Enos, 76 Wis. 634; Stearns v. Mullen, 4 Gray 151.

In the case of Shroder v. Brenneman, ubi supra, the supreme court of Pennsylvania remarked that the rule is stated in Howell v. King and runs through the subsequent cases, and that if the law were not so the owner of the close to which the right is appurtenant might purchase an indefinite number of adjoining acres and annex the right to them, by which the grantor of the way might be entirely deprived of the benefit of his land, a reason which applies with all its force to a private alley like that in respect to which the suit (Shroder v. Brenneman) was brought.

The case of French v. Marstin, ubi supra, was this: M owned what he called his “mountain pasture,” consisting of the Bean, the Brown and the Scheafe lots. He contended that he had the right of way to this pasture over the land of E, but there was no evidence that he had any such right to the Brown and Scheafe lots. It was held that notwithstanding he might have the right to cross the lands of E to go to the Bean lot, and notwithstanding the three lots might all be embraced in one pasture, he could not extend the right to the other lots, and that in crossing the land of E to go to the “mountain pasture” he would be a trespasser, and that E would have the right to use sufficient force to prevent his crossing. In this case (French v. Marstin) the supreme court of New Hampshire remarked (at p. 329) that the doctrine of the books upon this question is undoubtedly sound; that if a right of way to one lot be extended at will, by the tenant, to another lot that may adjoin it, then it may be extended to a third, and so on to any limits that the tenant may choose.

Greene v. Canny, ubi supra, is strongly analogous to the case at bar. In that ease A owned a lot abutting on a private way to which was annexed a right of way therein; also another lot abutting on the way, and a third lot which adjoined the first-named lot. The two lots last named did not have annexed to them any right in the way. A removed a fence between the second lot and the way, also a wall between the first lot and the third, and used the way for the benefit of the second and third lots. It was held that the owners of other lots on the way, and having rights therein, could join in a bill of equity against A, and that, on such bill, the court could compel A to rebuild the fence, but would not compel him to restore the wall, although A had no right to use the way passing to it from the third lot over the first.

Although the portion of the defendant’s premises in the year of the bath company’s property has been severed from that remaining to the bath company, which remaining portion is the front of lot No. 132 North Warren street, all legitimate rights, by way of easement, which passed to the entirety of No. 132, by the grant from Evans’ and Reading’s executors, still reside in the rear or subdivided portion. In fact, this is not disputed by the complainant. Among the cases illustrative of this doctrine are the following: In re Private Road, 1 Ashm. 417; McMakin v. Magee, 13 Phila. Rep. 105.

From the above authorities it clearly appears that the easement of the Toman brothers in the alleyway in question is appurtenant only to their lot in the rear of No. 132 North "Warren street, and that the way is servient only to its use as a carriageway to and from the lot, and that they cannot enter upon the lot through the alleyway for the purpose of going beyond the lot to their premises, No. 130 North "Warren street, nor can they, after passing them from the latter premises to the rear of 132, pass out through the alleyway.

This brings us to the third ground upon which the complainant rests its bill, namely, that the servitude extends only to horse-drawn vehicles, and that the word “carriageway” as used by the parties to the conveyance does not admit of an “automobileway.” To this proposition I am unable to assent.

The words “carriageway” and “wagon or carriage alley” are those in the deed designating the use to which the alleyway may be put. No particular kind of carriage or wagon is mentioned. Although automobiles had not been invented at the time the easement was created, yet the language of the grant is unrestricted, and must be held to include any vehicle on wheels then or thereafter to be used.

A carriage is defined to be “that which carries, especially on wheels; a vehicle.” 1 Am. & Eng. Encycl. L. (2d ed.) 155.

A case entirely in point, on principle, is that of Taylor v. Goodwin, 4 Q. B. Div. 228, in which it was held that a person riding k bicycle on a highway at such a pace as to be dangerous to the passers-by, might be convicted of furiously driving a carriage under 5 & 6 Wm. IV., c. 50 § 72. Justice Lush, concurring with Justice Mellor, made the following observations: “The mischief intended to be guarded against was the propulsion of any vehicle so as to endanger the lives or limbs of the passers-by. It is quite immaterial what the motive power may be. Although bicycles were unknown at the time when the act was passed, it was clear that the intention was to use words large enough to comprehend any kind of vehicles which might be propelled at such a speed as to be dangerous.” As the English statute referred to comprehended any kind of vehicle under the denomination of carriage, so the words in the covenant in the deed in question are large enough to comprehend any kind of vehicle, and, to my mind, it is quite immaterial what the motive power may be.

Mr. Huddy, in his Law of Automobiles (at p. 3), speaking of the machines which he calls automobiles or self-moving carriages, says that the only definition he has been able to find of them is that in English’s L. Dic. 78, which states that the term means “all motor traction vehicles capable of being propelled on ordinary roads. Specifically, horseless carriages.”

Automobiles were held to come within the definition of “carriages” in Baker v. Fall River, 187 Mass. 53, and in Commonwealth v. Hawkins, 14 Pa. Dist. Rep. 592.

Baker v. Fall River was á tort action by one for damages resulting from an injury sustained while traveling in an automobile by a defect in a street in Fall River. The action was brought under a statute of Massachusetts which permitted recovery by a person traveling with horses, teams and carriages. 1 R. L. (Mass.) 524 § 1. The defendant requested an instruction that the act did not apply to one driving an automobile which was not a “carriage” within the meaning of the statute, but was more like a “machine.” The instruction was refused and the trial judge said to the jury that he did not feel at liberty to instruct them that an automobile cannot be considered a carriage, and that if the other elements of liability were established he was entitled to recover. A recovery was had, and the supreme court, on appeal, remarked (at p. 56) :

“Plainly an automobile is a vehicle which can carry passengers or inanimate matter, and so is such a carriage as the decision in Richardson v. Danvers, 176 Mass. 413, 414, If-lk, said that the legislature had in view in the use of that word in the statute. * * * automobile is a vehicle in common use for^ transporting both persons and merchandise upon public ways, and its use is regulated by statute'. * * * We think that the plaintiff was not precluded from a recovery because of the nature of the vehicle in which he was riding, and that the instruction to that effect was right.”

In Richardson v. Danvers, cited in Baker v. Fall River, although a bicycle was held to be a carriage within the provisions of a certain Massachusetts statute, it was nevertheless observed:

“We have no doubt that for many purposes , a bicycle may be considered'a vehicle or a carriage: * * *

“The statute in question was passed long before bicycles were invented, but, although, of course, it is not to be confined to the same kind of vehicles then in use, we are of opinion that it should be confined to vehicles ejusdem generis.”

Commonwealth v. Hawkins was this: Defendant was arrested, charged with operating an automobile in Pittsburg without first having obtained a license provided for in an ordinance of March 30th, 190'5. Justice Frazer remarked (on p. 593) :

“While automobiles are not specifically named in the act of assembly (1868), they are certainly carriages.

“Webster’s-definition of carriage is That which carries or conveys; a wheeled vehicle for persons.’ In Snyder v. City of North Lawrence, 8 Kan. 82, the court said ‘carriages are vehicles used for the conveyance of persons.’ In Conway v. Town of Jefferson, 46 N. H. 521, the supreme court of the state, in passing upon the right of a municipality to license vehicles, said ‘carriages mean whatever carries a load, whether on wheels or on runners.’ Automobiles are wheeled vehicles used for the conveyance of persons. In view of these definitions, and of our general knowledge of such cars, they may undoubtedly be considered as carriages within the meaning of the act of 1868. That they were unknown when the act of 1868 was passed is not material.”

Being of opinion that automobiles are carriages within the meaning of the words in the grant of the way, I come now to the consideration of the fourth and last contention of the complainant, namely, that the defendants are creating a nuisance by using the alleyway for an automobile passage.

It must be conceded that even if automobiles are carriages within the meaning of the covenant under consideration, nevertheless, the alleyway may not be used for their passage if in such use a nuisance is created.

Upon this question of nuisance my judgment is also against the complainant’s contention.

Mr. Huddy lays it down that a garage does not constitute a public nuisance, and that an automobile station constructed on land abutting on a boulevard does not constitute a common-law nuisance, quoting Mr. Justice'Woodward of the appellate division of the supreme court of New York, who, in Stein v. Lyon, 91 N. Y. App. Div. 593, declared that the business of a garage keeper appears to be perfectly lawful, observing (on p. 596) :

“It was argued by the plaintiff * * * that the maintenance of an automobile station along this boulevard * * * was a common-law nuisance, but the learned court has found to the contrary, and we have no doubt of the correctness of this conclusion. The business of the defendant appears to be perfectly lawful and legitimate.”

In treating of what are and what are not nuisances per se it is stated in 21 Am. & Eng. Encycl. L. (2d ed.) 684, that since there must be some place where every lawful business or erection may be lawfully located or carried on, the better rule would seem to be that a lawful business or erection is never a nuisance per se, but may become a nuisance by reason of extraneous circumstances such as being located in an inappropriate place or conducted or kept in an improper manner. This I understand to be in effect what was decided in Weil v. Ricord, 24 N. J. Eq. (9 C. E. Gr.) 169, in which it was held that the city of Newark could not absolutely prohibit the carrying on of a lawful business (salting and curing hides) not necessarily a nuisance/but which might be conducted without injury or danger to the public health, and without public inconvenience.

Another case illustrative of the doctrine that a business lawful in itself is not a nuisance, but may be made a nuisance by the way in which it is carried on, considering the place where it is carried on, is Demarest v. Hardham, 34 N. J. Eq. (7 Stew.) 469.

These garages occupy with relation to automobiles the same place that stables do with regard to horses, and stables have not been held to be nuisances. Flint v. Russell, 5 Dill. (U. S.) 151; St. James’ Church v. Arrington, 36 Ala. 546; Stillwell v. Buffalo Riding Academy, 21 Abb. (N. Y.) N. Cas. 472 (Supreme Court, Special Term).

In Flint v. Russell it was held that a livery stable in the residence portion of a city is not, as a matter of law, necessarily to be considered a nuisance to the improved property adjoining or near it. Said the court (at p. 157), quoting Lord-Chancellor Brougham: “Where the thing sought to he restrained is not unavoidably and in itself noxious, but only something which may, according to circumstances, prove so, the court will refuse to interfere.”

In St. James' Church v. Arrington a bill was filed to enjoin the erection of a stable at the side of a church building and in close proximity to it, containing sixteen stalls, the allegation being that it would of necessity create a nuisance so aggravated as to militate materially against the welfare and usefulness of the church'. The chancellor sustained a demurrer to- the bill for want of equity, on the ground that a stable is not per se a nuisance, and the decree was assigned for error. The supreme court on appeal affirmed the decree.

In Stillwell v. Buffalo Riding Academy, the supreme court of New York held that although whatever may be obnoxious or offensive to the senses, either of sight, hearing or smell, or which will render the enjoyment of life or property unwholesome, or uncomfortable, is a nuisance- — the erection and use of a building for the stabling of horses, or even the business of a livery stable, is not in and of itself a nuisance.

Of course, an automobile garage may be so conducted as to become a nuisance, and this brings us to an investigation of the facts relied upon as showing that the use of the alleyway for automobile traffic constitutes a nuisance. On that subject the bill alleges, as already remarked, that the defendants, their customers and patrons are using the' alleyway for the purpose of entering and leaving the garage with their respective automobile machines at all hours of the day and night; that the machines are propelled by power generated from gasoline, and, when in operation,, they emit the odor of gasoline and volumes of smoke, which permeate the atmosphere and enter the door and windows of the complainant’s building, which look out upon the alley; that the automobiles while passing through the alley constantly make a variety of loud, disturbing and objectionable noises, interspersed with frequent explosions of gas generated in the machines, and that the constant mechanical noises of pro-pelting machinery while in motion affect and disturb the peace, quiet and comfort of the complainant’s building.

Depositions were taken before a master by consent for use upon the hearing. Two witnesses were sworn for the complainant, namely, Anna Bergin, known as Sister Michael, and Harry Lehey, and two -for the defendants, namely, John E. Toman and Marx E. Cohen.

Sister Michael says that she is a sister at St. Janies Day Nursery, and has been with the nursery as long as it has been in Trenton; that there are about thirty-five windows on the entire side of the building facing the alley; that they have small children from babies a few weeks old up to twelve years; some stay in the house, which is occupied as a convent by seven sisters, the third and fourth floors being occupied for sleeping apartments; that the building is occupied daily by from thirty-five to forty-five children, up to twelve and thirteen years old; that the garage building had been erected since January 1st, 1907, automobiles using the alleyway and going in sometimes as many as eighteen times a day, between day and night; that she never counted them; that she has noticed them go through as late as eleven o’clock at night; that they retire at nine o’clock, and have been disturbed by automobiles going through; that she has been disturbed about three times, and the other sisters have complained about being disturbed, but she cannot say how many times; that they have not been very much disturbed by the machines going through in the daytime, but have been with the noise they make before going through; that the noises would wake the little children up and they would start screaming; that they have always been annoyed by the smell of gasoline and smoke from automobiles ; that they could smell the gasoline in every back room and every room facing the alley; that before the garage was built there were gates on the front of the alleyway which were always closed, always except when being used; that the gate, though closed by the sisters as late as nine o’clock at night, has been found open the next morning; that they do not close the gate at all now, as it is too heavy for a woman, to lift.

Harry Lehey testified that he was an attendant at the Turkish bath and has been for a year; that the alleyway leading between the two properties (day nursery and Turkish bath) is used by Turkish bath people, and an automobile goes through there occasionally, the number that go through varies; that he could not tell the number; that he never saw any go through after eight or nine o’clock at night; that when they go through they make a mechanical noise, a noise like a cannon shot, once in awhile; that as to gasoline, at times they get it, but not always; that the patrons of the bath house complained sometimes when they wanted to sleep, the same as when the children next door make a noise; that they have not lost any patronage so far as he knows.

John E. Toman, one of the defendants, swore that there may be two or three machines going through the alley a day, some days none, some days maybe four or five, according to the jam they have in the garage; they use it for an outlet in case of congestion, the main entrance (to the garage) being on the south of their building, No. 130 North Warren street; that he never heard any machine make any more noise going through the alleyway than in passing along the street; that he did not think the smell of gasoline would last five minutes after a machine passes, if smelt at all; that as to smoke, very little comes from the machines as they pass through the alley, most of them not leaving any smoke behind; that he never heard any explosions in the alleyway; that he did not know of any explosions in the alleyway, none such as the sister spoke of, unless from a racing car Avith its muffler off; that they had two racing cars there for the fair (Great Inter-State Fair of 1907), whose mufflers were off when they went out, but they did not pass through the alley in question. He says there is a gasoline tank at the end of the alleyway from which automobiles are supplied.

Marx E. Cohen testified that he lived at 128 North Warren street, which is on the south side of the main alley leading into Toman’s garage (not the alleyway in question); that his bedroom faces on the alley; that the passing of an automobile would not Avake him up unless it Avas unduly noisy.

Of the seven sisters who occupy the day nursery, only one, namely, Sister Michael, was called. That she has been more or less disturbed by the automobile traffic through the alleyway is apparent. However, her testimony does not show a very serious condition of disturbance by reason of the passing of automobiles. While she says that automobiles go through the alley sometimes as often as eighteen times a day she has never counted them, but has noticed them go through as late as eleven o’clock at night. She says distinctly that they have not been very much disturbed by the machines going through in the daytime. As to the smell of gasoline which annoys them, I am satisfied that that must come from the tank which Mr. Toman says is at the entrance of the garage at the end of the alleyway. While Sister Michael says that other sisters would have complained about being disturbed, the fact is none were called to give their knowledge upon the subject. Harry Lehey, whn works in the Turkish bath house next door to the day nursery, said he never saw any automobiles go through the alley after eight or nine o’clock at night; he heard the noises, and that the patrons of the bathj house complained sometimes when they wanted to sleep, the same as the children in the nursery made a noise. His likening the disturbance made by the automobiles to the noise'made by the children would indicate that the noise made by the machines was not very great. The testimony of John E. Toman and Marx E. Cohen make in favor of the contention that as matter of fact the automobile traffic in the alley does not constitute a nuisance.

In Westcott v. Middleton, 43 N. J. Eq. (16 Stew.) 478, Vice-Chancellor Bird observed (at p. 485) :

“My attention has been called to the case of Pennsylvania Railroad Co. v. Angel, 41 N. J. Eq. (14 Stew.) 316. The principle there laid down is of great value in every such case. The defendant was engaged in a lawful business, but so used its tracks in making up its trains and distributing the cars in front of the complainant’s dwelling that, by reason of stenches, noises, smoke, steam and the dirt thereby occasioned, the comfort of the complainant’s home was seriously impaired. The court below allowed an injunction against such use of the road. But the court did not pretend to hold that the company must abandon the use of its tracks altogether. It was only decided that the company had no right to allow its engines or its cars to remain in the presence of, or near by, the house of the complainants, making hideous noises, emitting smoke and steam and unwholesome odors, to the great discomfort of the complainant in his home. The judgment of the court simply looked to the proper exercise of the lawful rights of the defendant, and in the lawful exercise of those rights what inconvenience or annoyance the complainants might suffer, they must submit to. Engines in passing might whistle or emit smoke, steam and dirt, cattle might bellow, sheep bleat and hogs squeal, but-to that extent the complainants must yield to the general demand. To this extent the court was sustained on appeal. I can find nothing in that case to lead me to say that the business of an undertaker is, a nuisance per se.”

The third syllabus in Westcott v. Middleton may be applicable to Sister Michael, especially in view of the fact that none of the other sisters were called as witnesses. It reads as follows:

“If a single person, of a most sensitive taste on the subject, is seriously disturbed thereby, and no others are called who have been annoyed, a case is not made requiring the interference of the court.”

In Hennessy v. Carmony, 50 N. J. Eq. (5 Dick.) 616, Vice-Chancellor Pitney had before him a question of nuisance said to arise from two machines called “whizzers” used in the drying of dyed materials, and he held:

“There is a distinction between injuries which affect the air merely by way of noises and disagreeable gases resulting in personal discomfort and those which injuriously affect the land itself or structures upon it. As to the former, each person living in society must submit to a degree of discomfort depending in some matters upon the circumstances of his residence. As to the latter, the owner or occupant of land is entitled to enjoy it free from any direct injury which will appreciably affect its value.”

My attention has been called by counsel for the complainant to the case of First M. E. Church v. Cape May Grain and Coal Co., 73 N. J. Eq. (3 Buch.) 257, in which Vice-Chancellor Learning granted an injunction to restrain the defendant from operating a roller skating rink in a building adjacent to a church, it appearing that the noise from the rink was so great as to render it impossible to hold services in the church while skating was in progress. This case, in my judgment, is not an authority for the granting of an injunction in the case at bar. That case (First Church v. Cape May) properly held that no person is justified in establishing a business adjacent to a church, the noise of which will render the continuance of the customary. religious services practically impossible, or which will interfere with such services to the extent of rendering it at times impossible for worshippers to hear the words of the preacher or the prayers which forms párt of the services, or which will render the occupancy of the church parsonage a burden.

Vice-Chancellor Van Fleet, in Demarest v. Hardhan, ubi supra, adopted, as perhaps the most accurate statement of the rules to be observed in deciding the question of nuisance, this language used by Mr. Justice Mellor in charging a jury at the Liverpool assizes in 1863, viz.: “The law does not regard trifling inconveniences; everything must be looked at from a reasonable point of view. * * * In determining whether a nuisance exists or not, the time, locality and all the circumstances should be taken into consideration.” This direction of the learned justice was approved by the court of queen’s bench and afterwards by the exchequer chamber and finally by the house of lords. St. Helen’s Smelting Co. v. Tipping, 11 H. L. Cas. 642. The English case just mentioned was an action for injuries done to property, but, nevertheless, in my judgment, the substantive law pronounced in that case is, on principle, applicable to this case.

The facts, in my opinion, do not make a case of nuisance against the defendants on the question of the operation of their garage.

My conclusions, therefore, are that the defendants of right may use the alleyway as a means of ingress, egress and regress to their garage with automobile machines, but that they may not after having gone upon that part of their property covered by the garage building, which comprises the rear of lot No. 13í¿, and which is marked C 2 on the diagram, go beyond that lot and on to Cl which is that part-of their property covered by the garage building which comprises the rear of No. 130; nor can they, with automobile machines or vehicles of any description, go from the lot G 2 out through the alleywajr in question, having first entered C 2 with their machines or carriages from lot C1 adjoining, to which there is access from North Warren street’ on the south side of No. 130, through the alley marked A and the door to the garage building marked B. I conclude, further, that the defendants are not creating a nuisance by their use of the alleyway as an automobile passage.

An injunction will be issued restraining the defendants from going upon the lot G1 with automobiles or carriages through the alleyway and across G also from going out through the alleyway with automobiles or carriages from G which were gotten on to O & from and oJS G 1.

The deed provides for a double gate at the entrance of the alleyway. This provision for a gate presupposes that it is kept closed. Sister Michael says that before the garage was built, the gates were nearly always closed, always except when being used; that the gate though closed by the sisters as late as nine o’clock at night, has been found open the next morning. In my opinion, the complainant is entitled to have this gate kept closed, and may include in the injunction an appropriate mandate requiring the defendants always to close it on each occasion of its use by them.