text:
    East Rutherford Building and Loan Association, appellant-respondent, v. Margaret Stewart McKenzie et al., appellants-respondents.
    [Submitted November Term, 1916.
    Decided March 5th, 1917.]
    On appeal from a decree of the court of chancery advised by Vice-Chancellor Howell, who filed the following opinion:
    “This suit was brought by the East Rutherford Savings, Loan .and Building Association against Margaret Stewart McKenzie, the widow, and Henry M. Ladd, the executor of the will of William McIvenzie, deceased, for the purpose of determining the title to some shares of stock of the complainant corporation which were claimed by both the widow and the executor. What is claimed to be the evidence of the ownership of the shares is on deposit with, the clerk of this court and consists of certificates of shares of stock and a pass book in which the account between the corporation and the shareholder were kept. A decree of inter-pleader has passed and the contending parties have filed their claims; and the cause now comes on for hearing and a settlement of the title to the shares in question.
    “The facts are these: On May 12th, 1913, arid for a long time prior thereto, William McKenzie, the decedent, owned two hundred shares of full-paid stock of the complainant corporation, the par value thereof being $100 per share, and Mrs. McKenzie owned sixty shares thereof, for which certificates had been issued to them, respectively, by the corporation and the shares stood in their names, respectively, on its books. At the same time Mr. McKenzie was the owner of five hundred shares of the same stock, which were not fully paid up. These shares were represented by a pass book numbered 156, in which was kept an account of all the deposits and withdrawals and exhibiting the balance to the credit of the shares on the company’s books. There had been paid on account of these shares something over $48,-000. In addition thereto, Mrs. McKenzie owned one hundred shares of the stock of the corporation which were redeemed by the corporation during the lifetime of Mr. McKenzie, so that this block of stock is not in controversy. Since the beginning of the suit the sixty shares of full-paid stock owned by Mrs. McKenzie have been surrendered and released to her by the executor, so that there remains in controversjr two hundred shares of the full-paid stock and five hundred shares of tire installment stock having an aggregate value of about $75,000. On the date last mentioned, 'May 12th, 1913, Mr. and Mrs. McKenzie severally surrendered to the corporation all the said certificates and the pass book No. 156, and at the same time made application for new certificates and a new pass book by signing their names to cards prepared by the corporation for the purpose. The cards so deposited with the pass hook No. 156 read as follows:
    “‘Date. May 12, 1913. Book No. 156. I hereby make application for 500 installment shares in the East Rutherford Savings, Loan and Building, Association, and agree to abide by its constitution, copy of which 1 have received. Signature. Wm. McKenzie. Residence. Carlton .Hill, N. J. Married. Wife’s name, Margaret Stewart McKenzie.’
    “The form of application for the other block of the shares was in the same form, the only changes being made necessary by the slightly varying subject-matter. On the reverse side of each of the said cards was endorsed a statement of which the following is a copy: ‘The shares in onr joint names are payable to either, or both, and to the survivor on the death of the other. Wm. McKenzie. Margaret Stewart McKenzie/ At the time the new certificates for the shares were issued, Mr. McKenzie gave directions that they should be issued as follows: The new certificates to Mrs. McKenzie were issued to ‘Margaret Stewart and/ or William McKenzie/ and the certificates which were issued to take the place of the ones that had been surrendered by Mr. McKenzie were issued to ‘William and/or Margaret Stewart McKenzie/ The proper entries were made on the books of the corporation to effectuate the purposes of the surrender of the old evidences of ownership and the issue of the new ones. All this took place on May 12th, 1913, and when the transaction was finished Mr. McKenzie went from the office of the complainant corporation having in his possession all the certificates and the pass book, representing two hundred shares of the full paid stock and five hundred shares of the installment stock of the said corporation. We now lose sight of the certificates and pass book in question until June 2d, 1913. In the year 1907, long prior to any controversy over this propertj1, Mr. and Mrs. McKenzie rented a safe deposit box at the store of Tiffany & Company, in New York, in the names of both. A year or so later the lock on the original box became out of order and another box numbered 630 was substituted. There was delivered at that time to Mrs. McKenzie two large keys for the outside door of the safe deposit box and two small keys for the interior tin box. It appears by the records of Tiffany & Company that no one ever claimed or had access to this box (to either the original or the substituted box) except Mrs. McKenzie. She kept it as her individual personal property, and, as I understand the evidence, only her property was ever placed in that box. She continued to rent the box in question from that time until after the beginning of this suit, and she says that the certificates for the two hundred shares having come into her possession she deposited them in the Tiffany box on June 2d, 1913, and that they remained there until they were taken out by her to be deposited with the clerk of this court under an order made in this cause for that purpose. This is the complete history of the custody of the shares, so far as is disclosed by the evidence, with the single exception that according to the evidence of Miss Guy, on June 1st, 1913, Mrs. McKenzie went out of the room where she and Mr. McKenzie and Miss Guy were engaged in conversation about building-and loan shares, and almost immediately returned and put something in Miss Guy’s hand and closed it over and said, “Plow do you feel having $26,000 in your hand?’ There was considerable discussion over the admissibility of this evidence, but it was finally admitted, and while there is no direct evidence that it was the certificates for the shares that were put in Miss Guy’s hands, still, it is stated by Mrs. McKenzie, that what she had in her hand was the shares, whence comes the argument that on that day she had the certificates for the shares in her possession. The evidence was clearly admissible.
    “The history of the pass book which represented the five hundred shares of installment stock is somewhat different! Mrs. McKenzie says that that pass book came into her possession and that she kept it from May 12th, 1913, down until within a few days of Mr. McKenzie’s death in á drawer in a chiffonier in her bedroom under lock and key; and that a few clays before Mr. McKenzie’s death the drawer containing the pass hook was surreptitiously opened and the pass book removed therefrom, together with the large key fitting into the lock of the outer door of the Tiffany safe deposit box. When she discovered it she instituted a search and found the small key to the inside box on the floor of the room in which the chiffonier was; the large key and the pass book were found in Mr. McKenzie’s safe at the mill when the safe was opened after his death.
    “Mrs. McKenzie insists that the surrender of the old certificates and pass book to the complainant corporation, and the issue'of the new certificate and the new pass, book in the joint names of the husband and wife with the. formula contained on the reverse side of the application cards, amounts to, and is, a consummated gift, and a settlement of the property on her to the extent of a joint ownership with the right of survivorship, and that upon the death of her husband she takes as survivor.

      “The law governing the ease has been illustrated by so many eases in this state and is so well understood that it is unnecessary to cite authorities. There must be a donative intention, a delivery of the gift, or what amounts to a delivery, and the donor must rid himself of all control over the subject-matter. There can hardly be any doubt but that Mr. McKenzie intended to place the property in the joint names of himself and his wife; he was a man of large business affairs, and was at the time conducting successfully a large business in this state; he was president of the building and loan association with whose shares he was dealing; he was evidently a man of strong will, large experience, and he, undoubtedly, knew rvhat he wras doing when he caused the old certificates and the old pass book to be surrendered and new ones issued in the joint names of himself and his wife. So far as appears, he .intended this to be a perma- - nent disposition of the property, because nowhere in the evidence is there any intimation that it was done for a temporary purpose. On the contrary, accordingi to the testimony of Mrs. Rut-land, he seems to have transferred the property to his wife permanently. I think there likewise was a delivery of the subject-matter of the gift within the requirements of the .larv on the subject. I find no authorities defining what is requisite for a delivery in the case of shares issued to joint tenants. Neither has the diligence of counsel been othenvise rewarded, and I suppose, therefore, rve are remitted to the rule that the delivery must be such as the subject-matter of the gift is most capable of. A delivery to one of trvo joint tenants must, in the nature of things, be a delivery to both. This would, undoubtedly, be true of tenants in common, wdiere it is the undoubted rule that the possession of one is the possession of all. That is, undoubtedly, the rule with respect to real estate. Foullce v. Bond, N. J. Law 527, and other things being equal, the same rule would apply to personal property. According to the.testimony of Mrs.' McKenzie the certificates of stock 'and the book came into her possession some time between May 12th and June 1st, 1913. The fourth section of- the Evidence act precluded her from stating that possession came to her from her husband, and, therefore, we must say that it does not appear horv the property got into her possession. I do not think that the court can assume that it came into her possession unlawfully; it would preferably infer that the husband intended to malee a settlement upon her and that she came into possession of the property in pursuance of that arrangement and in a lawful manner. It was supposed by counsel for the executor at the argument that the certificates and the pass book did not come into Mrs. McKenzie’s possession until a few days prior to his death, when she sent the. witness Widows to the mill for money and for the brown envelope, which she says contained only Mr. McKenzie’s will. But this supposition on the part of the executor is a mere supposition; there are no facts whatever to support it, nor any set of circumstances from which corroboration can be obtained. I am, therefore, constrained to reject the argument so made upon the ground that it appears to me to have no foundation in fact.
    “The two objections to Mrs. McKenzie’s claim urged by the executor are (1) that the transaction amounted to a testamentary disposition of the property and was void because it was not made in accordance with the requirements of the statute of wills, and (2) that if the act which was performed by Mr. McKenzie was intended as a gift inter vivos, it failed because he retained the actual physical possession of the evidences of the subject-matter of the gift, to wit, the certificate and the pass book. I think the first objection is without substantial foundation. The argument against the executor’s position is this: The testamentary disposition of property is one which is intended to take effect at or after the death of the testator. If a vested interest is created in his lifetime that vested interest is valid, notwithstanding the will and all the requirements of law touching the testamentary disposition of property. The only valid objection to gifts, or attempted gifts, upon the ground of lack of testamentary form, lies in the fact that the interest dealt with is an interest which does not vest until after the death of the testator. Here, if any interest passed to Mrs.. McKenzie by virtue of the transaction appealing in the evidence, it passed on May 12th, 1913, nearly a year before the death of Mr. McKenzie, and not until that event did her full right accrue. It is the ordinary case of the present vesting of an interest to be enjoyed at some time in the future. The second objection, viz., the lack of delivery, has already been dealt with; but there remains to be added a word on the point of the donor’s renunciation of all control over the property. It is undoubtedly true that the changing of the title to the shares from individual ownership to joint ownership effected no change whatever in the manner in which the parties to the transaction dealt with the shares. Mr. McKenzie remained president of the building and loan association, and to all outward appearances there was no change. Even supposing that there had been no actual physical delivery of the evidences of the property to Mrs. McKenzie, Mr. McKenzie as joint tenant with the right of survivorship had such an interest in his right of survivorship as permitted him to hold and manage the joint property to the best advantage of all concerned.
    “I am, therefore, of opinion that by virtue of the transaction above recited the title to the said shares and pass book, and the fund represented by them, vested in Mr. and Mrs. McKenzie as joint tenants on May 13th, 1913, and that upon the death of Mr. McKenzie, Mrs. McKenzie became entitled to tire property by the right of survivorship, and I will advise a decree to that effect. The decree will be made, without costs.”

      Messrs. IÁndahv/ry, Depue & Faulks, for the complainant.

      Jlessrs. Qollins & Corbin, for the defendants.
   Per Curiam.

The decree appealed from will be affirmed, for the reasons stated in the opinion filed in the court below by Vice-Chancellor Howell.

For affirmance—The Chiee-Justice, Garrison, Swayze, Trenchard, Parker, Bergen, Minturn, Kalisci-i, Black, Wi-iite, Heppeniieimer, Gardner—13.

For reversal—None.


source: Caselaw Access Project

author: Per Curiam.

license: Public Domain

text:
    The Cosmopolitan Bank, appellant, v. Pauline Wenigmann et al., respondents.
    [Submitted November Term, 1916.
    Decided March 5th, 1917.]
    On appeal from a decree of the court of chancery advised by Vice-Chancellor Stevens, who filed the following opinion :
    “This is a creditor’s bill. The facts are simple and undisputed. On September 15th, 1915, the complainant recovered judgment against Christine Wenigmann in the supreme court of New York for1 $4,039.26. The complainant then brought suit thereon in New Jersey and recovered judgment against her in the supreme-court of this state for $4,176.01. The judgment debtor is the wife of Ernest Wenigmann, a contractor, who held substantially all the stock of the Wenigmann Construction Company. This company owned land in the Bronx, and on July 11th, 1914, conveyed it Pauline Wenigmann, a daughter of Ernest and Christine On July 18th, 1914, Pauline exchanged the land thus conveyed for a farm in Hunterdon county, in this state. The effort is to subject the farm in the hands of Pauline to the judgment against her mother, on the theory that the conveyance is fraudulent as against complainant, or on the alternative theory that Pauline holds the land in trust for her mother and that complainant can therefore fasten his claim upon it.
    “It seems to me perfectly plain that complainant has not made out a case. According to the evidence, the Wenigmann Construction Company owed Christine $35,000. Mr. Wenigmann (not the corporation) had some understanding with his wife, as far as the evidence goes, vague in the extreme, that he would convey the Bronx property to her, but whether in satisfaction of the debt or not does not appear. ■ He did not do so. He caused the company to convey to his daughter Pauline, in satisfaction, as he pays, and, as Pauline says, of an agreement had with her and her
      mother several years before, that if she would forego the college education that her brothers and sisters were receiving, stay home and assist in the house, they would recompense her and give her a fair compensation.
    “'Ernest Wenigmann, on cross-examination, testified as follows:
    “Q. The Wenigmann Construction Company made the deed to Pauline?
    “A. Yes, sir.
    “Q. Because you and your wife requested it, did you not?
    “A. Xo, we did that because we wanted to avoid the expense of drawing a double deed and double expense and double recording fees and taxes and so on. Therefore we drew it directly to Pauline so we would avoid that.
    “0. Instead of doing it how?
    “A. Instead of first drawing it to- Mrs. Wenigmann and then Mrs. Wenigmann to her.”
    “Out of these answers the complainant has constructed the following theory: The conveyance to the wife was to be made in satisfaction, or part satisfaction, of the debt due to her. Thus vested with title, the wife was going, voluntarily, to transfer it to her daughter iii fraud of her creditors. But the conveyance, made directly to the daughter, has the same legal effect as if it had been conveyed first to the wife and then to the daughter. Unfortunately for this theory the fundamental fact— ownership of the lánd by the wife, some legal or equitable estate in her—has not been shown. In the first place, the property did not belong to the husband, but to the corporation, and no agreement with the corporation, parol or written, is pretended. In the second place, no agreement, in writing, assuming his authority to bind the company, was made by the husband, its controlling stockholder, with his wife. As far as appears,'there was' not even a definite verbal understanding between them as to the terms upon which the conveyance should he made. What understanding there was, gave way to a different understanding, viz., that a conveyance should be made to the daughter in fulfillment of the promise that the husband had made to the daughter some years previous.
    “How a fraudulent transfer by the mother to the daughter, or how a resulting trust in the daughter for the mother could he built upon such a foundation, I am at a loss to conceive. The company’s creditors, if there were any, might have .objected to this'method of disposing of the property, but how a creditor of Mrs. Wenigmann could, is not apparent. If the Wenigmann company had contracted in writing with Mrs. Wenigmann to.cancel her indebtedness in consideration of a conveyance of the property, she would then have acquired an equitable interest in it which her creditors might have seized. But, as it did not so contract, she acquired no interest and for aught that appears still remains the company’s creditor. The case is simply this: That Mr. Wenigmann, assuming to speak for the company, first told his wife that he would convey its property to her, and then changed his mind and caused it to convey to his daughter. All this may have been highly irregular, but, as I have said, complainant, not being the company’s creditor, has no standing to complain. I think the bill should be dismissed.”

      Mr. Maurice Steiner, for the appellant.

      Mr. II. Burdett Herr, for the respondents,
   Per Curiam.

The decree appealed from will be affirmed, for the reasons stated in the opinion filed in the court below by Vice-Chancellor Stevens.

For affb-mance—Ti-ie Ci-iiee-Justice, Garrison, Trenchard, Bergen, Minturn, Black, White, Hepeeni-ieimer, Williams, Gardner—10.

For reversal—None.


author: Pee Curiam.

text:
    Charles E. Drake, petitioner-respondent, v. Elizabeth Drake, defendant-appellant.
    [Submitted November Term, 1916.
    Decided March 5th, 1917.]
    On appeal from a decree of the court of chancery advised by Advisory Master Magie, who filed the following opinion:
    “Notwithstanding the denials of the defendant and Bellott, the evidence satisfies me'that she is guilty as charged by the petitioner. .
    “This conclusion would ordinarily result in advising the decree nisi in favor of the petitioner, but, under the provision of section 28 of the Divorce, law, such a decree cannot be advised if the charges made by the defendant at her cross-petition are sustained by sufficient evidence.
    “The evidence on that subject is, in my judgment, not satisfactory. It is encountered by the denials by petitioner of the charge. I would be unwilling to, advise a decree thereon.
    “The result of all is, that petitioner is entitled to a decree nisi and I will so advise.”

      Mr. George 17. V. Moy, for the appellant.

      Mr. Robert N. Crane, for the respondent.
   Pee Curiam.

The decree appealed from will be affirmed, for the reasons stated in the opinion filed in the court below by Advisory Master Magie.

For mffk-mmce—The Ci-iiee-Justice, Garrison, • Swayze, Trenohard, Parker, Bergen, Minturn, Kalisci-i, Black, Heppenheimer, Williams, Gardner—12. ■

For reversal—None.


author: Walker, Chancellor.

text:
    Edwin Robert Walker, Chancellor.
    Frederic W. Stevens, Eugene Stevenson, Edmund B. Beaming, Vivian M. Lewis, John H. Backes, John Grieein, John E. Foster and Merritt Lane, Vice-Chancellors.
    Arthur C. Tipton et al. v. John Randall et al.
    [Decided April 27th, 1917.]
    1. A motion to strike out a bill is one substituted for, and takes the place of, a demurrer in the former practice, and is practically a demurrer.
    2. .The general rule is that a party will not be permitted to demur after he has pleaded to the merits.

      3. Under the terms of an order striking out an answer the defendants were granted leave to file an amended answer within a given time, not to demur. Within the time so limited the defendants gave notice of a motion ■ to strike out the bill on various grounds; and, the time for filing the amended answer having expired, the complainants entered a decree pro oonfesso which defendants now move to strike out as improvidently entered, claiming that rule 75 of this court suspended the running of the time to file an amended answer.—Held, that as the motion to strike out the bill was made after the defendants had submitted to answer, which answer was struck out with leave to file an amended answer, not to demur, the motion to strike out in lieu of demurrer, is in-efficacious, and that the rule did .not suspend the time for filing an amended answer, and that, consequently, the decree pro oonfesso was properly entered and the motion to strike it out, for the reason relied on, must be denied.
    On motion to strike out decree pro oonfesso.

      Mr. William A. Lord, for the motion.

      Mr. Stirling D. Ward (of, Messrs. Lindabury, Depue & Faúlles), contra.

   Walker, Chancellor.

The files in this case show that the defendants answered the complainants’ bill, and that by an order made on March 23d, 1917, the answer was struck out and defendants given ten days within which to file an amended answer. Before the expiration of that time defendants’ solicitor served a notice on complainants’ solicitors of a motion to strike out the bill of complaint on various grounds, and claims that rule 75 of this court suspends the running of the time to file an amended answer. It does, in terms, but the question is as to whether or not the rule applies at all in this case, under the given circumstances. And that depends upon whether the defendants had a right to move to strike out the bill after having submitted to answer. The time for answering under the order of March 23 d expired on April 2d, and, for want of an amended answer being filed, the complainants’ solicitors entered a decree pro oonfesso on April 4th-. Motion is now made to strike out the decree pro oonfesso as improvidently entered, as a necessary step precedent to arguing the motion to strike out the bill.

A motion to strike out a bill is one substituted for, and takes tlie place of, a demurrer in the former practice. It is practically a demurrer. This has been repeatedly decided.

' The general rule is that a party will not be permitted to demur after he has pleaded to the merits. 31 Cyc. 275. And demurrers come too late after the time limited for filing them has expired. Ibid. 274. Under the terms of the order to strike out the answer, the defendants were given leave to file an amended answer, not to demur.

In England a defendant demurring alone to any bill might do so within twelve daj^s after his appearance, and not afterwards. Dan. Ch. Pl. & Pr. (6th Am. ed.) *591. And a demurrer would not be received after the twelve days without a special order enlarging the time, and giving leave to file it, and if by inadvertence it was received, it would, on application of the plaintiff, be taken off the files. Ibid, *592.

The question before me I regard as settled in this state by the decision of the court of errors and appeals in Hand v. Hand, 60 N. J. Eq. 518, in which it was held that a defendant who had failed to file his pleadings within time and a decree pro confesso had been entered against him, could not, under permission to answer, file a demurrer to the bill. The facts in that ease and the one at bar are not the same, but the principle is. There, a decree pro confesso had been entered before any defensive pleading was filed, and the defendants applied for and obtained an order opening the decree to allow them to file an answer in the cause. Under this permission the defendants filed an answer setting up inter alia that the bill was multifarious, and prayed the benefit of such defence by way of demurrer, and the court held (at p. 521) that as the permission granted extended only to answering the bill, they were limited to the defence mentioned and .could put in no farther or other defence without leave of the court.

From the foregoing it follows that the motion to dismiss the bill in this case, made after the time, for answering had expired and when an answer already put in had been overruled, with permission only to file an amended answer, came too late, and the complainants had a right to disregard it and enter their decree pro confesso after the expiration of the time limited for filing an amended answer.

The motion to strike out the decree pro confesso, on the ground that it was improvidently entered, must, therefore, be denied, with costs. But this will be without prejudice to an application to open the decree pro confesso for the purpose of filing an amended answer, if notice of such application be given' within five days.

A defendant coming in without unnecessary delay after a decree pro confesso regularly taken will, upon reasonable ground, be permitted to answer upon payment of costs. Dick. Ch. Prec. (rev. ed.) 34. note (a). See, also, Emery v Downing, 13 N. J. Eq. 61; Williamson v. Sykes, 13 N. J. Eq. 182.


text:
    Turner A. Beall et al. v. The New York and New Jersey Water Company et al.
    [Decided July 16th, 1917.]
    1. On final hearing in the court of chancery but one decree may be entered, no matter how numerous the parties or the issues.
    2. The purpose to be accomplished by a decree in equity is to finally settle and determine the rights of all persons interested in the subject-matter of the suit.
    3. In a decree in chancery there need not be, in the ordering or mandatory part, an adjudication of the existence of facts warranting such decree, although they may be stated in the recital preceding the decretal paragraph, or may be omitted entirely.
    4. There should be an adjudication in a decree of the rights to which a party or parties are entitled. This does not induje several negative adjudications against the complainant as to precise questions put in issue on which he is unsuccessful, but it is only necessary that a general adjudication in favor of defendant, so far as he is successful, need be made, unless there are specific matters or things to be awarded to him and which cannot appropriately be made the subject of an omnibus adjudication.

      5. While it. seems that every matter put in issue by the pleadings is to be presumed to have been adjudicated, if there be a decree, for or against one or more of the parties „to the suit, yet for greater certainty, it is better formally to adjudicate in terms all issues in a chancery suit, either generally or specifically, as the nature of the case may require; and a decree can always be so framed.
    6. The allowance of a counsel fee to a party to a suit in equity under the Chancery act (P. L. 1902' p. 51¡0 § 91, amended P. L. 1910 p. 427) is discretionary.
    7. The rule is that where a complainant and a defendant are each successful on one or more substantial issues, neither party is entitled to costs or counsel fee against the other.
    8. When a complainant prevails in part, and a defendant in part, the complainant is entitled to enter the decree, which should adjudicate the relief to which he is entitled and dismiss the bill as to the relief • to which he is not entitled, reciting that the cause came on for hearing in the presence of counsel for the respective parties, naming the parties and counsel, but not reciting that the decree is entered upon the motion of counsel for either party, the name of complainant’s solicitor only being endorsed on the back of the decree. a
    On motion for the settlement and entry of decree.

      Messrs. Collins & Corbin, for tlie complainants.

      Messrs. 2fcGarter & English, for the defendants New York and New Jersey'"Water Company and others.

      Messrs. Fort ■& Fort, for the defendant J. Gilmore Fletcher.
   Walker, Chancellor.

This canse was heard before the Hon. James E. Howell, vice-chancellor, who filed an opinion and died before advising a decree. Counsel for complainants, on due notice to defendants, have moved before me for the settlement of a decree in accordance with the views expressed in the late vice-chancellor’s opinion.

The vice-chancellor prefaced his opinion with a statement of the objects of the suit and the prayers for relief, and observed that the scope of the bill and application for relief are much broader than 'the points submitted at the hearing. After stating the relief to which the complainants are entitled, he remarked that the remainder of the points taken by 'the complainants must be "decided in favor of the defendants; that is to say, the decree must provide that, as to those points, the complainants’ allegations and proofs fail to make an actionable case against the defendants, which points he shortly described, and indicated the reasons that led to his conclusions concerning them.

Messrs. Collins & Corbin, for the complainants, submit a form of decree to be entered as on their motion, making appropriate recital of the reference, hearing, filing of opinion and death of the vice-chancellor before decree made, and notice of the present application to the chancellor to settle the decree, which draft adjudges the affirmative relief only decided upon in the opinion^ and does not contain any adjudication of a negative character, namely, that complainants are'not entitled to relief as to any of the several matters concerning which the allegations and proofs failed to establish an actionable case against defendants, which would be affirmative in its character so far as the defendants are concerned. This form of decree provides for costs and counsel ■fees to the complainants against the individual defendants.

Messrs. McCarter & English, on behalf of the defendants whom they represent, also submit a draft of decree, not expressed to be made on motion of any counsel, but with their firm name endorsed op the hack thereof, which decree first adjudges that certain of the relief prayed be denied, and then decrees the affirmative relief to which the complainants are entitled, but is silent on the question of counsel fee and costs.

Messrs. Fort & Fort, representing the defendant J. Gilmore Fletcher, also submit a form of decree, as on their motion, which adjudges that in so far as any relief is prayed against their client, the bill be dismissed, and that he recover against the complainants his costs of suit, including a counsel fee.

Messrs. Collins & Corbin insist that they are entitled to enter the decree on behalf of the complainants, that it should not contain any negative adjudications against them, 'which would be affirmative ones in favor of defendants, and that the defendant Fletcher is not entitled to have the bill dismissed as against him, with or without costs and counsel fee.

The assertion made on behalf of Fletcher that he is charged with fraud personally, dissociated from the other defendants, is not borne out. His counsel’s claim is that he was made a defendant and relief prayed against-him because of various specific allegations of fraud on his part as director of the New York and New Jersey Water Company. He was, moreover, a director of the Suburban Water Companjq and one of the transactions directed in the opinion to be set aside is a proceeding by Fletcher and his fellow-directors of both the New York and New Jersey Water Company and the Suburban Water Company, which resulted in procuring $125,000 of the bonds of the New York and New -Jersey Water Company for the benefit of the Suburban Water Company, in exchange for a certain conveyance, which the opinion holds is unlawful and should be set aside, because five of the directors, including Fletcher, wer'e directors of both companies—interlocking directors—which imparted to the transaction the character of a dominant corporation obtaining an advantage of a servient one.

The first question presented is as to who is entitled to enter the decree.

The purpose to be accomplished by a decree in equity is to finally settle and determine the rights of all persons interested in the subject-matter of the suit. See the remarks of Vice-Chancellor Van Fleet in Jones v. Davenport, 45 N. J. Eq. 77 (reversed 46 N. J. Eq. 237, but not on this point). On final hearing but on e decree is entered, no matter how numerous the parties or the issues.

In a decree in chancery there need not be in the ordering or mandatory part an adjudication of the existence of facts warranting such decree, although they may be stated in the recital preceding the decretal paragraph or may be omitted entirely (Bull v. International Power Co., 84 N. J. Eq. 6); but there should lie an adjudication in a decree of the rights to which a party or parties are entitled. This does not include, as -I understand it, several negative adjudications against a complainant as to precise questions put in issue and on which he is unsuccessful, but that it is only necessary that a general adjudication in favor of the defendant, so far as he is successful, need be made, unless, of course, there are specific matters or things to be awarded to him and which cannot appropriately be made the subject of an omnibus adjudication. 'This, I think, appears from the mere contemplation of the fact that if the complainant were wholly unsuccessful a simple decree would be entered reciting that he was not entitled to relief touching the matters set forth in his bill, and that the bill should be dismissed, and that, too, without long-recitals, to the effect that he was', not entitled to this and that' specific relief, &c.

It is true that the vice-chancellor states in his opinion the allegations in the bill which the proofs .failed to establish, and says that the decree must provide, as to them, that an actionable ease was not made. This does not indicate to me, however, that he meant that the}'- should be set out seriatim in the decree; and I think the decree will afford the defendants all the protection they need by a clause dismissing the bill as to all and singular the matters and things alleged therein, and which are not adjudged in favor of the complainant. This form of decree would give the defendants all they are entitled to by way of estoppel of record against any other suit or action by the complainants, or those in jorivity with them, with reference to any of the allegations of the bill which are not adjudicated in their favor.

Every matter put in issue by the pleadings is undoubtedly to-be presumed to have been adjudicated, if there be a decree for or against one or more of the parties to the suit. And yet the expression of the judges in the decided cases generally is that a former judgment is conclusive as to all demands in issue and adjudicated in the former sxiit. Southern Pacific Railroad Co. v. United States, 168 U. S. 1; 40 L. Ed. 355; Willoughby v. Chicago Railways Co., 50 N. J. Eq. 656. In any event, for the sake of greater certainty, it would appear to be better to formally adjudicate in terms all issues in a chancery suit, either generally or specifically, as the nature of the case may require; and a decree can always be so framed. The form of judgments of courts of law are not as elastic as decrees in equity, and sometimes do not show what were the points submitted for decision. In this situation it seems that resort may be had to parol evidence to show what was submitted and decided. See Wells Res Adju. § 102.

Now, as to the question of costs: It has already been observed that each of the'parties, complainants and defendants, have succeeded in paid, and, I should addj that both sides have succeeded on substantial issues.

In Diocese of Trenton v. Toman, 70 Atl. Rep. 881, I held, when vice-chancellor, that under the Chancery act (P. L. 1902 p. 540 § 91) the allowance of a counsel fee to complainant was discretionary. That section was amended in 1910 (P. L. 1910 p. 427), but in no way which is important with reference to the case now before me. The allowance of counsel fee to one party against another in a case like the one sub judice is not compulsory, but discretionary, and, therefore, the rule that where the complainant and defendant are each successful on one or more substantial issues, neither is entitled to costs as against the other, applies; and this, obviously, extends to counsel fees as well.

The result reached is that a decree may be entered by the complainants’ solicitors granting the relief to which complainants are entitled, as stated in the opinion of the late vice-chancellor, containing a paragraph dismissing the bill as to all and singular the matters and things alleged against the defendants and which are not in and by the decree adjudged to the complainants, and also a paragraph to the effect that neither of the parties, complainants or defendants, is entitled to costs and counsel fees as against the other or others, with the right reserved to the complainants to apply for costs and counsel fee to be paid by the New York and New Jersey Water Company out of such avails as may be gotten for it by and through the relief awarded in the decree.

Now, as to the form of the decree: In our practice it is quite usual, in the ordering part of a decree, to recite that it is made upon motion of counsel, naming them, for the party entering the decree; but, I think that where a complainant prevails in part, and is consequently entitled to enter a decree, that decree, where a negative adjudication is to be made against the complainant, which is affirmative so far as the defendant is concerned, ought not to be entered. apparently ■ on the motion of complainants’ counsel, when, in truth, it is not, and I think it unusual to enter a decree with alternate recitals of motions made on belialf of complainants and defendants, naming counsel as moving for the respective parties, for the specific relief accorded to each. I concede that this may be done without impropriety, and yet I am unaware of any practice authorizing it. In this connection I have taken occasion to look up some forms of decrees for the purpose of ascertaining whether or not such a practice as just referred to exists. In the forms printed in the Equity Draftsman —American Notes, 1861—(at p. *828 et seq.), the decrees are not expressed to be made upon the motion of counsel. The decree in Page v. Harris, commencing at p. *880, is one awarding relief to both complainant and defendant; and (at p. *882) it is recited that the matter came on “in the presence of counsel learned on both sides,” and the ordering part commences, “and his honor doth declare that the plaintiff is entitled to,” &c. And, further on, it is ordered that “the said plaintiff do forthwith grant and execute to the said defendant,” &c.

It may be that the reason that the English decrees in chancery were not expressed to be made on motion of counsel, naming them, was because the decrees were not signed by the' chancellor, but were drawn up by the register of the court in conformity to' the chancellor’s opinion. Dan. Ch. Pl. & Pr. *1008 et seq. However this may be, our own approved forms of decree seem to have been drawn upon the English model, for, in Dan. Ch. Free, (rev. eel.), the form of a final decree (at p. 178), while it recites the presence of counsel, does not purport to be made on motion of counsel. This is true of the forms of decrees in foreclosure proceedings (at p. 861 el seq.) and of a final decree of divorce (at p.1,63).

The decree to be entered in the case at bar will recite that the cause came on for hearing in the presence of counsel for the respective parties, naming the parties and counsel, but will not . recite that it is made on motion of counsel for any one of them. The decree will, however, be entered by the complainants’ solicitors, whose firm name will be endorsed upon the' back thereof. The draft must be submitted to defendants’ solicitors who, if they object to its form, will be heard on that question.


text:
    Trenton and Mercer County Traction Corporation, and Trenton, Pennington and Hopewell Street Railway Company v. The Inhabitants of the Township of Ewing et al.
    [Decided August 10th, 1917.]
    1: Municipal corporations are not, as respects public rights, within statutes of limitations, but, the principle of an estoppel in pais is applicable in exceptional cases, empowering the court to decide the question, not on the mere lapse of time, but upon all the circumstances of the case, and to hold the public estopped or not, as right and justice may require.
    2. A street railway company, haying obtained permission to construct, maintain and operate a street railway upon a township road, by ordinances of the township committee and county board of freeholders, in accordance with a map of its proposed route designating certain turnouts at given points, in constructing its railroad changed the location of one of its turn-outs from the point designated on the map to another point a, considerable distance away, where, however, its location could have been authorized originally: the railroad and turn-out, thus constructed, were maintained and operated for twelve years without any protest from the municipalities, or the landowner in front of whose property the turniout was constructed, the present owner having acquired the property after the turn-out had been installed for ten years, having had actual notice of its location and operation when he purchased and went into possession of the premises.—Held, that the municipalities, both of which ordered the removal of the turn-out, one of which (the township) directed its agent actually to remove it, and that agent, should be perpetually enjoined from removing the turn-out from its present location; no injunction to go against the individual landowner, who never threatened to remove the turn-out, has no intention of doing so, and only urged upon the municipalities that they take proper steps to remove it.
    On final hearing on pleadings and proofs.

      Mr. Edward M. Hunt and Mr. George W. Macpherson, for the complainants.

      Mr. Willis P. Bambridge, for the township of Ewing and Alwyn A. Temple; defendants.

      Mr. Samuel 0. Kulp, for tlie board of chosen freeholders of the county of Mercer, defendant.

      Messrs. James & Malcolm G. Buchanan, for defendant Arthur S. Kniffin and the other defendants.
   Walker, Chancellor.

On November 1st, 1902, the township of Ewing, in the county of Mercer, passed an ordinance granting to the Trenton, Pennington and Hopewell' Street Railway Company, one of the complainants, permission and right to construct, maintain and operate a street railway upon the Pennington road in that township, and at or aboui the same time the board of .chosen freeholders of the county of Mercer also passed an ordinance granting permission to the railway company named to construct its railway along the Pennington road in the township of Ewing. These ordinances provided that the railroad should consist of a single track, with three turn-outs in the township of Ewing, as shown upon the map of its proposed route. The purpose of the turn-outs, or switches as they are otherwise called, was to enable cars to pass each other on the track while going in opposite directions. By the passage of the two ordinances mentioned the statutory right of the company to construct the railroad became complete, and subsequently, in the year 1903, the company constructed its railroad over the route granted, with three turn-outs, or switches, in the township of Ewing, one of which was, and is, known as “Green’s switch,” the one in_ question in this suit, which, however, was not built at the point shown on the map but at a distance of some one thousand and seven hundred feet therefrom.

On or about October 15th, 1910, the Trenton, Pennington and Hopewell Street Railway Company leased its railroad and appurtenances, including its rights under the ordinances mentioned, to the Trenton and Mercer County Traction Corporation, the other complainant.

In the year 1915 the Ewing township committee and the freeholders of Mercer notified the complainants to remove this switch, and, the demand, not being complied with, the township committee ordered its agent, the defendant Alwyn A. Temple, to make the removal. This resulted from complaint and request emanating from Dr. Arthur S. Kniffin, the owner of the land in front of which the switch is located.

Dr. Ivniffin in his affidavit says that his house on the Pennington road is immediately opposite Green’s switch; that he has lived there for nearly three years, and that the switch is an inconvenience to him; that he never had any intention, nor has he any intention, of personally removing the switch or causing it to be removed, nor has he ever threatened to do so, but has urged upon the board of freeholders and the township committee that they take proper legal steps to have it removed. He says in his answer that on or about August 1st, 1915, he first learned that Green’s switch was illegally constructed and maintained, that is without authority for construction and maintenance opposite the dwelling into which he moved a few years ago, which was ten years after the switch had been constructed; it having-been built some twelve years before proceedings were taken looking to its removal.

Very full affidavits were submitted on both sides and the cause' was fully argued on the hearing of the motion for a preliminary injunction, and I asked the parties if they were willing to submit the matter as on final hearing, but this was not assented to; therefore, the matter was disposed of on motion for interlocutory injunction, which was granted.

After stating the facts substantially as above set forth, I said in my memorandum granting the preliminary injunction:

"Given a switch or turn-out which existed in a locality for twelve years without protest from either the owner of abutting land or the proper authorities, and it follows that the status should be preserved pendente lite, especially as it is not shown that any decided inconvenience to the public or the landowner will occur ad interim

After the granting of the interlocutory injunction the parties consented that I should decide the question as on final hearing, on the pleadings, depositions and exhibits submitted.

After a careful review of the whole case my opinion now is that the complainants are entitled to have the status preserved perpetually. No inconvenience whatever to the public will result from it, and very little, if any, to the landowner in front of whose property the turn-out was laid in 1903, and has since been maintained; and especially should the injunction go, as the defendant Dr. Kniffin did not own the premises at the time of the turn-out's construction, .but acquired the property about ten years afterwards with the turn-out in front of it.

Although the turn-out, or switch, is not located at the point shown upon the map of the railway line and designated by the ordinances granting permission for the laying of the tracks, and if it had been built at the point designated by the ordinance and map it would not be in front of the property so long afterward acquired by the defendant Dr. Kniffin, I am of opinion that the defendants, or any one of them, are not entitled to insist upon its removal.

That this court has power to enjoin the removal, by a municipal corporation, of tracks of a street railway company, in a proper case, has been decided in Asbury Park and Sea Girt Railway Co. v. Neptune Township, 73 N. J. Eq. 323; affirmed S. C., 75 N. J. Eq. 562. The question is: Is this a proper case ? I think it is.

Although consent to the building of the road with the turn-outs shown- on the map was legally granted, the defendants contend that the turn-out in question, not being located at the point designated on the map, consequently was not authorized by the ordinances, and that ratification of the location of the turn-out, if any, was given informally and not by the proper municipal authorities in meeting assembled for that purpose; and they rely largely upon West Jersey Traction Co. v. Camden Horse Railway Co., 53 N. J. Eq. 163, wherein it was held that where a statute requires consent by a township committee to legalize the laying of a street railroad, it is necessary that the consent should be given when the members of the committee, or a majority of them, are assembled in corporate meeting, and that the declarations of individual members are not legal evidence to prove acts of the corporate body, nor is the public estopped by such declarations. That case, however, was one in which an injunction was sought to restrain the alleged improper building of a line of railroad in the first instance; and the doctrine of estoppel against a municipal corporation which had for at least twelve years acquiesced in an actual location of a railroad turn-out, which it could have authorized in the first instance, was not presented. That estoppel obtains against an individual defendant in such case I think undoubted.

In O’Leary v. Street Railway Co., 87 Kan. 22, it was held by the supreme court of Kansas that the city of Kansas City should be estopped from questioning the legality of certain completed changes in one of its streets, made by a street railway company under color of ox'dinances of the city, although such changes were not warranted by the ordinance, but which were to be considered as having been lawfully made, the city having had power in the first instance to authorize them, and that the abutting property owner should not be allowed damages on the theory that the-work xvas xxnlawful and created a nuisance. The court observed (at p. 3.0), quoting from Bridgewater Borough v. Traction Co., 214 Pa. St. 343:

“Where a street railway company in laying its track on a borough street has slightly deflected from the line for the track ■established by the borough and the box’ough has acquiesced in this location of the track for ten years, it will be presumed to have ratified the deflected line, and if the railway company in reconstructing its track lays it upon the deflected line, the borough has no standing to object.”

The situation before me is quite similar to that ixx Bridge-water Boroxxgh v. Traction Co., quoted in O’Leary v. Street Bail-way Co. There á street railway company laid its tracks, not on the line established by the municipality, but on one deflected therefrom. Here, the railway company has constructed a switch, not at the point located by the ordinance and map, bxxt at some distance therefrom.' There is no practical difference, at least xxone in principle, in deflecting the tracks of a street, railway from a line established by municipal authority, and in building a turn-out at an authorized point but at one somewhat rexxxoved therefrom. It is xxot upon the doctrine of adverse possessioix, bxxt upon that of estoppel in pais that the municipality and the private owner should now, under all the circumstances of the ease, be enjoined from removing the turn-out from the location where it was maintained for twelve years without protest from the municipality or the landowner, the present landowner having acquired his property after the switch had been installed for ten years, and who, therefore, had actual notice of its location and' operation at the time that he purchased and went into possession of the premises in front of which the turn-out is laid. .'-Judge Dillon,, in his work on municipal corporations (5th ed. ■vol. 8 p. 1900 § 119Ji-), treating of adverse possession of streets and highways, states his view and suggestions as to the true doctrine as follows:

“Upon consideration, it will perhaps appear that the following view is correct: Municipal corporations, as we have seen, are regarded as having, in some respects, a double character—one public and the other (by way of distinction) private. As respects property not held for pub■lic use, or upon public trusts, and as respects contracts and rights of a private nature, there is no reason why such corporations should not fall within limitation statutes, and be affected by them unless excluded from them. For example, in an action on contract or for tort, a municipal corporation may plead or have pleaded against it the statute of limitations. But such a corporation does not own and cannot alien public streets or places, and no mere laches on its part or on that of its officers can defeat the right of the public thereto; yet there may grow up, in consequence, private rights of more persuasive force in the particular case than those of the public. It will perhaps be found that cases sometimes arise of such a character that justice requires that an equitable estoppel shall be asserted even against, the public, but if so, such cases will form a law unto themselves, and do not fall within the legal operation of limitation enactments. The author cannot assent to the doctrine that, as respects public rights, municipal corporations are impliedly within ordinary limitation statutes. It is unsafe to recognize such a principle. But there is no danger in recognizing the principle of an estoppel in pais, since this leaves the courts to decide the question,' not by the mere lapse of time, but upon all the circumstances of the case to hold the public estopped or not, as right and justice may require.”

This same doctrine of equitable estoppel against the public arising out of matter in pais was asserted by me, when vice- ; chancellor, in Mason v. Ross, 75 N. J. Eq. 136, 143; reversed S. C., 77 N. J. Eq. 527, but upon other grounds. ■

The views above expressed lead to the conclusion that the defendant municipalities, both of which ordered the removal of the turn-out, one of which (the township) directed its agent actually to remove it, and that the agent, should be perpetually enjoined from removing the turn-out from its present location; no injunction to go against the individual landowner, who never threatened to remove the turn-out, has no intention of doing so, and only urged upon the municipalities that they take proper steps to remove it. The only award of costs to be made inter partes will be in favor of the complainants against the defendant municipalities.


text:
    Ellen Platt v. George M. Johnson et al.
    [Decided August 14th, 1917.]
    1. Testator devised the remainder of his real estate to his wife for life or so long as she should remain his widow, and, after her death or remarriage, to his two daughters to be equally divided between them, share and share alike; and in case of the decease of either daughter, then to the survivor absolutely unless the deceased daughter should leave lawful issue, then that such issue should take the share which would have been received by such deceased daughter had she been living; in case both daughters should die, each leaving lawful issue, then the share of each daughter to be divided equally among such issue surviving, respectively; and in case of the death of both daughters without leaving lawful issue, then the estate to be divided equally among testator’s legal representatives .(meaning, doubtless, heirs), share and share alike. These events happened: Testator’s wife died in his lifetime; one daughter, having married, also died in her father’s lifetime and without issue; the father then died, leaving his other daughter him surviving.—Held, upon the father’s death the absolute devise to the surviving daughter took effect, and the remainder to his heirs generally was defeated.
    2. The court of chancery has power to decide a-question beyond its jurisdiction when it arises incidentally and collaterally in a suit within its jurisdiction, which decision, however, has no force res judieata or by way of estoppel.

      3. If the legal title to lands is in issue in a suit for partition, the court of chancery will either dismiss the bill or retain it to allow the title to be settled in an action at law; and the practice is guite universal to retain it.
    On bill, &c. On objection to master’s report.

      Mr. William M. Jamieson, for the complainant.
   Walker, Chancellor.

The bill in this case was filed for the partition of land in the city of Trenton, of which the late George M. Mitchell died seized. The complainant, Mrs. Platt, is his surviving sister. The defendants are the children and grandchildren of a deceased brother and sister. An interlocutory decree was entered in which the bill was taken as confessed against the defendants, and it was referred to William J. Backes, Esq., special' master, to ascertain and report on the right, title and interest of the respective parties in the premises, &e., with direction that the report be filed on a certain day therein mentioned, which was done.

The master reported that ho was of opinion that Mrs. Over-ton, one of Mr. Mitchell’s daughters, upon the death of.her father, took an indefeasible estate in fee-simple, under his will, in the lands sought to1 be partitioned and that the parties to the suit had no right, title or interest in the land. In this opinion I concur. The master was guided by the decision of the court of errors and appeals in Patterson v. Madden, 54 N. J. Eq. 714. This case applies, as does also the very recent one of Michael v. Minchin, 101 Atl. Rep. 283, in the same court.

Counsel for complainant made oral objection to the report at' the time it was filed, in pursuance of rule 227 of this court, and claimed that the master’s conclusion should be overruled and the matter sent back to the master to report upon the other questions referred, because, as he contended, the devise to Mrs. Over-ton was defeated by her death without issue, and that the last contingent devise in the testator’s will to his .legal representatives, meaning heirs, took effect. An examination of-the testament will, I think, quite conclusively show that the master is right.

The testator made his will in 1880, and it was proved in 1907, shortly after his death. In it he devises and bequeaths the residue and remainder of his real and personal property to his wife for life or so long as she should remain his widow, and, after her death or remarriage, to his two daughters, Josephine and Harriet, to be equally divided between them, share and share alike. And in case of the decease of either daughter, then to the survivor absolutely, unless the deceased daughter should leave lawful issue, then that such issue take the share which would have been received by such deceased daughter had she been living. In ease both daughters should die, each leaving lawful issue, then the share of each daughter to be divided equally among such issue surviving, respectively, and in case of the death of both daughters without leaving lawful issue, then the estate to be divided equally among testator’s legal representatives, share and'share alike.

These events happened: The testator’s wife died in his lifetime. His daughter Harriet, having-married a man named Outhouse, also died in her father’s lifetime and without issue. The father then died leaving his daughter- J osephine him1 surviving. She was then married to Frederick C. Overton, who, the Over-tons, on.June 14th, 1913, conveyed the premises to an intermediary who reeonveyed them to Mr. and Mrs. Overton, thus creating an estate by entirety in them, if the title were good, and T think it was. Mrs. Overton died March 2d, 1917, leaving her husband surviving, whereupon he became possessed of the entire estate in the premises.

It is to be observed that on the will taking effect in 1907, upon the death of the testator, the only devisee in esse qualified to take under the will was Mrs. Overton, and the language of the devise, which devolved the property upon her, is: “Apd in case of the decease of either one of my said daughters, then I give, bequeath and devise the same to the survivor absolutely.” It is apparent that if there was no subsequent provision in the will, the surviving daughter, Josephine Overton, would take the estate in fee-simple absolute. Let us see what subsequent contingency might make some other vesting of the whole or any part of the premises.

It is to be borne in mind that the devise of the entire premises was to the surviving daughter absolutely unless the deceased daughter left issue, in which event the issue would take her share. The daughter Harriet was dead without issue, and, consequently, the whole estate vested in her sister Josephine. Now, it was further provided that in case both daughters should die, each leaving issue, the share of each was to be equally divided among' her issue. Because of the death of the daughter Harriet in her father’s lifetime without issue, this contingency of one sister surviving and one dying leaving issue, could never happen on or after the taking effect of the will. Next, and last, in case of the decease of both daughters without issue, then the residuary estate was to be equally, divided among testator’s legal representatives, meaning, concededly, his heirs and next of kin—heirs in this case, as we are here only dealing with real estate.

Complainant claims that this limitation over -to the heirs of the testator has not been defeated, and that by the death of his wife and of his two daughters, no issue being left by either of the latter, the limitation over to the heirs of the testator is good and has taken effect.

I cannot be persuaded that the provision of the will that in case of the decease of both daughters without issue the estate of Mrs. Overton, who took “absolutely” on her father’s death, was cut down to an estate for her life and limited over to her father’s heirs as mentioned. It must be apparent that if, when the will took effect, both daughters were living both would have taken, and if the deceased daughter Harriet had issue surviving they would have taken her share—that is, one-half, while the other half would have gone to the daughter Josephine, in fee-simple, and that in either case the limitation over would have been defeated. It is unreasonable to believe that the testator intended to give his surviving daughter a fee in one-half of his residuary estate if her previously-deceased sister had left -issue, but, if she died without issue, then the whole estate for life only, with remainder over to his heirs generally. I think it clear that the one-half which the surviving sister would take in fee if the-other died leaving issue, was to be increased to a fee in the other half also if her deceased sister left no issue, thus giving the whole estate to the surviving daughter of the testator. That is the natural disposition that a man would make of his property.

In my opinion this limitation over to the testator’s heirs generally stands, not in opposition to the devises to the daughters, but to the death of both of them prior to the death or remarriage of their mother, the testator’s wife. This contingency did not happen as one daughter outlived her mother and sister, both of whom were deceased at the death of the testator and the consequent taking effect of his will. Upon the father’s death, therefore, the absolute devise to the surviving daughter took effect, and the remainder to his heirs generally was defeated.

In my opinion Mr. Overton, the surviving husband of testator’s deceased daughter Josephine, is now the owner of the premises sought to be partitioned, in right of surviving his wife, because the limitation over to the testator’s heirs has been defeated. He is not made a party to the bill. If the decision were to be against his interest, he should be made a party, although, of course, a decree without his being before the court would in nowise bind him. By chancery rule 6 any person may be made a defendant who is alleged to have a claim or interest in the controversy ; and by rule 12 the court, at any stage of the proceedings, either upon or without application, may order any party improperlj- omitted to be added; but, by rule 13, the court may determine the controversy as between the parties before it where it can do so without prejudice to the rights of others. And the court can, and does, determine this matter without in anywise prejudicing the rights of Mr. Overton. -In form, the decision is beneficial to him, but in fact it doubtless does not benefit him, because made incidentally in a cause to which he is not a party; and this quite aside from any question of the court’s power to decide as to the legal title to the premises, as this court has power to decide a question beyond its jurisdiction when it arises incidentally and collaterally in a suit within its jurisdiction, which decision, however, has no force res judicata or by way of estoppel. See Mullaney v. Mullaney, 65 N. J. Eq. 384, 387.

Counsel asserts that the reason he did not recite in the bill the conveyances from Mrs. Overton and her husband to the intermediary and from him to them, and why he did not make Mr. Overton a party, was because that would raise an issue of title not triable in this court. If this be so, it does not afford a conclusive reason for the course taken. He was obliged to set out a title in the parties, complainant and defendants, or the bill would not lie. The allegations concerning title should have been entirely ingenuous and disclosed all. All was disclosed to the master by the proofs submitted to him on behalf of the complainant. And it is upon proof alwnde the bill that the master finds that the parties have no interest in the premises, the title to which is in a stranger.

If the legal title to lands is in issue in a suit for partition, the court of chancery will either dismiss the bill or retain it to allow the title to be settled .in an action at law. Slockbower v. Kanouse, 50 N. J. Eq. 481; Havens v. Sea Shore Land Co., 57 N. J. Eq. 142. And the practice is quite universal to retain it.

The objection to the master’s report must be overruled .and the bill dismissed. .


author: Stevens, Y. C.

text:
    Augustus J. Lauenstein et al., executors, v. Elizabeth Lauenstein et al.
    [Decided May 19th, 1917.]
    Where a testator bequeathed a business which she did not own, but •which owed her money, tire legatee is not entitled to the amount the business owed the testatrix, as a satisfaction of the legacy.
    On bill, Sac.

      Mr. Charlton A. Reed, for the executors.

      Mr. Elmer King, for Edward Kelly, guardian.

      Mr. Benjamin W. Ellicott, for Thomas J. Conlon.
   Stevens, Y. C.

This is a bill for the construction of the third paragraph of the codicil of the will of Julia Kelly. It reads as follows:

“Third, A part of my estate consists of the stock, equipment &c of the business known as Dover Auto Supply House located on Blackwell Street in Dover, N. J.; this, subject to the debts and obligations thereof, I give and bequeath to my son Thomas Conlon,'who is now associated in the management thereof.”
“This is an absolute bequest to him and not subject to the restrictions placed on his share of the residue in my said will. It is my will however that this bequest to the amount of twenty five hundred dollars be considered as paid to him out of the residue of my estate and to said extent as on account of his share thereof.”

There can be no doubt that looking only to the language of the bequest the legacy is specific. It has, however, been judically determined by this court that the “stock, equipment,” &c., of the business did not belong to the testatrix but to her husband. Consequently, the gift failed. M’Kinnon v. Thompson, 3 Johns. Ch. 307; Marshall v. Hadley, 50 N. J. Eq. 547.

But it is said that on the peculiar circumstances, if the legatee cannot have the business, he is entitled to have what the business owed his mother for advances. It appears that testatrix was desirous of giving her son a start. For this purpose she contributed the money with which a considerable part of the stock and equipment were, at the beginning, purchased. The business was to be carried on in the name of the “Dover Auto Supply House,” and to. this end Mrs. Kelly’s husband, pursuant to the act of May 17th, 1909, filed in the county clerk’s office a certificate in which he stated that he, Edward Kelly, intended to conduct the business of dealer in auto supplies, &c., and that the true name of the person who was to transact it was himself. He was a man of pecuniary responsibility, and the goods, bought from time to time, were largely purchased on his credit. The legatee, Thomas, was made the active manager and he conducted the business under the general supervision of his father. Mrs. Kelly received interest on the money advanced by her, a part of which was repaid. It was ascertained by the decree of this court that at the time of her death Mr. Kelly owed her estate a balance of $2,029.40.

The contention is that Thomas Conlon is entitled to thé immediate payment of this sum, as a substitute for the business which testatrix intended to give him—a business she, no doubt, believed to be hersj because of the money she had contributed. The legal aspect of the matter is this: The stock and equipment belonged to her husband. He was her debtor for the money lent. By her will she gave this stock and equipment expressly subject to “the debts and obligations thereof.” Thomas, taking the business, was to take it subject to debts, one of which was the debt due to herself. The debt in question was not a benefit to the business but a burden. Thomas was, according to the language of the will, not to receive it, but to pay it. To hold that a gift of the business, subject to 'its debts, was a gift of the money which the legatee would have been under the necessity of thus paying, if he had taken it, would be impossible. He certainly would not take under the words of gift. In Marshall v. Hadley, supra, Vice-Chancellor Van Fleet held that a gift of land, which neither at the time of tire making of the will nor afterwards the testator owned, did not include a gift of a mortgage upon the land which he did own; and in M’Kinnon v. Thompson, supra, Chancellor Kent decided that a devise of land not owned by testator could not operate as a bequest of a judgment debt charged upon the land in his favor. These cases are much more favorable to the contention than the one in hand. . Here testatrix, so far from giving, imposed an obligation to pay.

I think that Mr. Coition’s claim to the money cannot be sustained.


author: Stevens, V. C.

text:
    Condit Beef and Provision Company et al. v. Simeon W. Arliss et al.
    [Decided May 22d, 1917.]
    . 1. A voluntary conveyance is presumed to be fraudulent as to debts antecedently due.
    2. Orane v. Brewer, 78 N. J. Eq. 558, approved and followed.
    3. Severs v. Dodson, 58 N. J. Eq. 634, distinguished.
    On bill, &c.

      Mr. Herbert J. Hmnoch, for the complainants.

      Mr. Hugo Woerner, .for the defendants.
   Stevens, V. C.

This is a creditor’s bill to set aside a voluntary conveyance.

In March, 1915, the defendant Arliss, a retail butcher, made such a conveyance to his wife. At the time he made it, he was indebted' to the complainants, wholesale butchers, on a running account. He continued to buy from them for several months thereafter, and, from time to time, made payments on account. According to the rule relating to appropriation of payments, the debit items of the account, as they stood when the conveyance was made, were satisfied by the payments made subsequently, but the account was never paid in full; and it was not reduced to an amount less than that which was owing at the time of the conveyance.

The question is'whether complainants were existing creditors within the rule of Haston v. Castner, 31 N. J. Eq. 703. This question was answered in the affirmative by Vice-Chancellor Howell in Crane v. Brewer, 73 N. J. Eq. 558. The argument now made is that the decision does not notice and. does not accord with that of the court of errors and appeals in Severs v. Dodson, 53 N. J. Eq. 634. I should hardly feel at liberty to disregard Crane v. Brewer, but I may say that it seems to me to be rightly decided. Haston v. Castner holds that a voluntary conveyance is presumed to be fraudulent as to debts antecedently due; and that, as a rule of evidence, no circumstances will be permitted to repel this legal presumption. Severs v. Dodson decides that an accommodation endorser of a promissory note is not a debtor within the meaning of the rule.

In the case in hand, the complainants were creditors when the conveyance was made and they continued to be up to the entry of judgment.' There was always, during the intervening period, a debt owing- as great as that which existed at the time defendant conveyed. The debt, it is true, was from time to time increased and diminished, but it continued to be one debt, contained in one account and constituting a single cause of action. The situation was similar to that appearing in Whittington v. Jennings, 6 Sim. 493, a case in which a voluntary assignment, made under 'like circumstances, was avoided.

The case in hand differs from Severs v. Dodson, in the controlling circumstance that there, there was a contingent liability and not an existing debt. Chief-Justice Beasley said that the conclusive presumption obtained only when the conveyance was made by one indebted. In the case in hand it was so made. It was, therefore, voidable at the time. As the debt persisted until judgment, although the items of which it was composed underwent change, it would seem more reasonable to apply the rule of Haston v. Castner than that of Severs v. Dodson. To apply 'the latter rule would be putting the rule as to application of payments to a very unwarrantable use.

It is argued that the partial payments were made with reference to particular items. I fail to see that it makes any difference, as far as the present question is concerned, whether the payments exactly equaled the items or overpaid them. In either case a part of the whole debt remained.