author: Howell, V. C.

text:
    Joseph Bray et al. v. General Engineering Company et al.
    [Submitted March 15th, 1909.
    Decided March 24th, 1909.]
    1. Upon a bill filed to restrain the further prosecution of an attachment suit, all the proceedings therein including the auditor’s sale and auditor’s deed were complained of upon two grounds, viz.: (1) Because the attachment proceeding was against B. only whereas it was based upon a covenant made by him and his wife contained in a deed made by them to the plaintiff in the attachment suit comprising real estate owned by her in her own right, and (2) because the proceeding was surreptitiously and oppressively carried on without B.’s knowledge and is therefore as to him constructively fraudulent and consequently void. It appeared upon the hearing that the writ of attachment was issued upon the filing of an affidavit in the usual form against non-resident debtors stating an indebtedness by B. to the plaintiff which, it further appeared, grew out of the payment of a municipal lien affecting real estate comprised in a deed'of conveyance executed by B. and his wife, she being the owner of said real estate in her own right, to the plaintiff therein, who thereupon caused the writ to be issued against B., and it did not appear that B. had any notice whatever of the proceeding.-—Held, (1) assuming that an action for damages may -be cognizable in the law court upon the ground that the damages in the particular case were matter of calculation, nevertheless, the covenant is a joint one binding both husband and wife jointly and not severally, and they must therefore be jointly sued, and it appearing that she was also his joint debtor and residing in this state at the time of the commencement of the attachment suit, there is an irregularity in the attachment proceeding, but whether this court would have jurisdiction to entertain the complaint on that ground alone it is not necessary to decide. Held further, (2) after an examination of the evidence relating to the second objection respecting the manner in which the attachment was issued and the proceedings conducted, in view of the circumstances of this case, considering the severance of the obligation, the surreptitious manner of conducting the attachment proceeding, the fact that the lot of land comprised in the auditor’s deed (the property of B. levied on), worth from $750 to $900, was purchased by the plaintiff in attachment for $25 subject to something over one hundred dollars in liens, it would not be equitable to permit the plaintiff in attachment to avail itself of the proceedings and that the auditor’s deed and all the proceedings upon which it is formed would be set aside.
    2. The two principles decided in this class of eases are these, viz.: (1) That a defendant in a judgment at law who has a defence which he might have made successfully at law if he had had an opportunity to set it up, but who was prevented from doing so by accident or by the fraud of his adversary unassisted with negligence or fraud on his part, may still have the benefit of his defence by suit in equity; and (2) that where a plaintiff in attachment recovered a judgment as against a defendant on a false claim or by concealing from the auditor any fact which tends to show that the claim on which his attachment is founded is not a valid one, a court of equity will, in case no relief can be had at law, interpose to protect the defendant against the judgment, provided he shows that the judgment was entered without his having such knowledge of the suit as afforded him an opportunity to make his defence.
    3. Such relief, however, will be awarded Upon condition that the complainant do equity, and therefore the decree will provide that upon payment to the grantee in the auditor’s deed, being the, plaintiff in the attachment suit, of the amount paid tq satisfy the municipal liens with interest, within twenty days after the date of the decree, thereupon said proceedings shall be null and void, and upon such payment, or tender thereof, said grantee .shall reconvey said premises to the defendant in the attachment suit, and discontinue and cancel said attachment proceedings.
    On final bearing on bill, answer, replication and proofs.

      Mr. Alfred F. Stevens, for the complainants.

      Mr. Thomas A. Davis, for the defendants.
   Howell, V. C.

This bill is filed to restrain the' further prosecution of an attachment suit in the Hudson circuit court, in which the General Engineering Company is plaintiff and Joseph Bray is defendant.

The facts are that on September 3d, 1907, the complainants Joseph Bray and Mary J., his wife, made a conveyance to the General Engineering Company of a lot of land in the township of Kearny, in the county of Hudson, by a warranty deed in which they covenanted that the land was free of all encumbrances. The title to the lands conveyed was in the wife, so that she was bound by the covenant. Gen. Stat. 2012 § 7.

The grantee in October, 1907, discovered that there were municipal assessments against the property amounting to upwards of $300. On July 21st, 1908, it paid the municipality $328.27 to satisfy these liens.

Joseph Bray, one of the complainants to. this suit, held title to another lot in the same township. At the time of the transactions herein recited he was residing and had for many years been residing in the State of Nevada. The grantee, having-paid the amount of the assessments, in the month of December, 1907, caused the attachment now complained of to be issued out of the Hudson circuit court against Joseph Bray alone to recover the damages which it had suffered by reason of the breach of the covenant against encumbrances contained in the deed above mentioned. The attachment proceeding was taken under the act for the relief of creditors against absent and absconding debtors. P. L. 1901 p. 158. It was begun by the usual affidavit against non-resident debtors, made by Alexander H. Mathesius, president of the engineering company, which stated that the defendant Joseph Bray was a non-resident and was indebted to the General Engineering Company in the sum of $321.33. In due course an auditor was appointed who sold the attached property. It was purchased by the General Engineering- Company, the plaintiff in attachment, which took a deed for it dated July 20th, 1908.

The proceedings in the attachment suit have not been laid before the court, but it will be assumed not only that they were brought under the act above mentioned, but also that they were entirely regular as an attachment suit under the act above mentioned against Joseph Bray alone. The evidence shows that this lot which is valued by the witnesses at from $750 to $900 was sold at the auditor’s sale and purchased by the General Engineering Company for $25, subject to a municipal levy of some soyt, on which there was due something over a hundred dollars. Notwithstanding the sale of the lot in question and the purchase of it by the General Engineering Company, that company still claims that there is due to it over $400 on account of the judgment recovered by it in the attachment suit, including costs and expenses theteon. The bill alleges and the answer admits that the General Engineering Company is about to take proceedings to include in the attachment other lands belonging to the said Joseph Bray and sell them for the purpose of raising the four hundred odd dollars yet claimed to be in arrear.

This whole attachment proceeding, including the auditor’s sale and the auditor’s deed, is now complained of upon two grounds—first, because the attachment proceeding was against Joseph Bray alone, whereas it was based upon a covenant which was made by Joseph Bray and Mary J., his wife, in the deed above mentioned; second, that the proceeding was surreptitiously and oppressively carried on without the knowledge of the said Joseph Bray, and is, therefore, as to him constructively fraudulent and consequently void.

First. As to the first cause of complaint; assuming for the sake of the argument that an action for damages may be cognizable by the circuit court in an attachment suit upon the ground that the damages in the particular case are mere matter of calculation, can the plaintiff in the attachment suit in question proceed against one of two joint covenantors, or must the action be brought against the two? The statute above quoted (Gen. Stat. 2013 § 7) seems broad enough to permit a married woman to bind herself jointly with her husband in covenants against encumbrances, and in Wahl v. Stoy, 72 N. J. Eq. (2 Buch.) 607, Vice-Chancellor Bergen held that a married woman was bound by a restrictive covenant respecting her own land, although she had made the covenant in a deed executed by hex which conveyed lands that belonged to the husband. The husband is liable by reason of his execution of the instrument containing the covenant. It appears on the face of it to be their joint action, and I must therefore hold that the covenant is a joint covenant binding them jointly and not severally. Under these circumstances their liability is joint and they must be jointly used. Barber v. Robeson, 15 N. J. Law (3 Gr.) 17; Curtis v. Hollingshead, 14 N. J. Law (2 Gr.) 402. The principle is a very familiar one. There is, however, an exception to it arising out of section 3 of the Attachment act (P. L. 1901 p. 159), which permits attachments to issue against the separate and joint estate of joint debtors, or any of them, * * * and the estate so attached, whether separate or joint, may be sold oi' assigned for the payment of the joint debt. This statute was co3U3nented upon in the case of Thayer v. Treat, 39 N. J. Law (10 Vr.) 150, where it was held that an attachment might be issued under the section of the Attachment act referred to against 0330 of several joint debtors, but only in a case where all such joint debtors were non-residents. This authority was considered and affirmed by the supreme court in Corbit v. Corbit, 50 N. J. Law (21 Vr.) 363, which held that where there was a proceeding in attachment against one joint debtor who was non-resident, it 33iust affirmatively appear in the p3'oceedings that the other joint debtors were no3i-residents also.

In this case it satisfactorily appears that the wife of Joseph Bray, who was also his joi3it debtor-, continued to reside in this state and to be amenable to the writ of summons until the month of August, 1908, when she went to Nevada to join her husband. It thus appears that there is an irregularity in the attachment proceeding, but whether this court would have jurisdiction to entertain the complaint on that ground alone it is not at this time necessary to decide.

Second. The second objection relates to the manner in which the attachment was issued and the proceedings conducted. It is said on the part of the complainants that not only is the proceedings against one joint obligor irregular and void, but also that the attachment proceeding in this case has been used in such a way as to oppress the defendant therein and subject him to real annoyance and loss, and this to such an extent as to be capable of characterization as a direct abuse of the process of the court. It does not appear that the defendant in attachment had any notice whatever of the proceeding. At the time of the issuing of the writ he was residing in Nevada; he has continued to reside there; it appears by the evidence of Mr. Mathesius, the president of the General Engineering Company, that no effort was made on his part as such president to notify Mr. Bray of the pendency of the attachment proceedings. Mr. Mathesius knew that only a short time before the wife of the defendant lived in Newark; he had visited her house for the purpose of discussing business matters with her and knew where she lived, and it is claimed that he was told that she had rented the property for a year. This, however, lie denies. He did know, however, that a daughter of the defendant in attachment resided in East Orange, not far from the house in which he himself had but recently resided; he knew also that Samuel Eustice, the brother of Mrs. Bray, the wife of the defendant in attachment, was in possession of the lot of land which was attached at the time of the attachment, and was using the same as a chicken farm; that he was not only then in possession, but has been in possession ever since. He also knew that John Eustice was the business agent of the defendant, and that his office was in Newark. Mr. Mathesius further states that he never did make any inquiry for the residence or address of the defendant, nor did he notify any of the persons who would be likely to inform the defendant of the pendency of the attachment. It will be presumed that the notice required by the statute is the only notice that was attempted to be given of the attachment.

In Herbert v. Herbert, 47 N. J. Eq. (2 Dick.) 11, the facts were that Henry L. Herbert, a resident of New York, purchased land in Munmouth county upon which he built a summer home. In May, 1889, he sold the property to Devoe, who gave back to Herbert a purchase-money mortgage for $5,000. Several months before the conveyance to Devoe, John W. Herbert issued an attachment against Henry L. Herbert and attached the lands in question. This proceeding was carried on regularly and judgment was entered in April, 1890, against the defendant in attachment, Henry L. Herbert, for nearly $4,000. The property was sold by the auditor and purchased by the plaintiff in attachment for $3,000, and not until all this had happened did Henry L. Herbert know anything about the attachment proceedings. They had been conducted by John W. Herbert’s son, who was an attorney at law of this state, and no notice or intimation of the existence of the suit had been given to Henry L. Herbert, although ’John W. Herbert and his son had both meantime visited Henry L. Herbert’s office in New York and knew where he could be found. The charge was that the attachment proceedings were secretly conducted in pursuance of a scheme to obtain judgment against the defendant, Henry L. Herbert, without affording him an opportunity to defend, and to sell the property attached and buy it in without the knowledge of the complainants for a grossly inadequate price. A motion to strike this bill from the files was made under the rules, the motion having the force and effect of a demurrer. Chancellor McGill sustained the bill upon the authority of Moore v. Gamble, 9 N. J. Eq. (1 Stock.) 246, and Tomkins v. Tomkins, 11 N. J. Eq. (3 Stock,) 512. In the latter case, Chancellor Williamson says: “In a case like the present of foreign attachment where the proceeding is in rem and the judgment is obtained without the knowledge of the defendant. and the proceedings are all necessarily ex parte, it will be hard, indeed, if this court would not interfere to protect a party against the fraud of the plaintiff. The propriety of this court’s interfering in such cases is too obvious to require its being vindicated.”

The case came on for final hearing before Vice-Chancellor Van Fleet, in Herbert v. Herbert, 49 N. J. Eq. (4 Dick.) 70. His judgment was affirmed by the court of errors and appeals, Ibid. 565. The vice-chancellor says: “He was thus, in consequence of his ignorance that a suit had been brought against him, deprived of all opportunity to go before the court, out of which the attachment issued, and show that the claim on which the attachment was founded was invalid. The gravamen of the complainant’s case is that he has been condemned unheard, or, stated in another form, the wrong of which he complains is this: That his property has been taken away from him and made over to -the defendant by means of a judgment, founded on a false claim, without his having had an opportunity of being heard in his defence. In the language of the chancellor, in this very case, ‘it would be monstrous if equity could not give relief in such a case.’ ”

The two principles decided are these—first, that a defendant in a judgment at law who has a defence which he might have made successfully at law if he had had opportunity to set it up,' but who was prevented from doing so by accident or by the fraud of his adversary unmixed with negligence or fraud on his part, may still have the benefit of his defence by suit in equity, and second, that where a plaintiff in attachment recovers a judgment against the defendant on a false claim, or by concealing from the auditor any fact which tends to show that the claim on which his attachment is founded is not a valid one, a court of equity will, in case no relief can be had at law, interpose to protect the defendant against the judgment, provided he shows that the judgment was entered without his having such knowledge of the suit as afforded him an opportunity to make his defence.

Tn this case not only did one of the joint covenantors reside in this state at the time of the attachment, but the president of the company, and, therefore, the company, was in a position to know that fact, and also to ascertain the residence of the defendant in attachment, who was proceeded against. I do not know of any rule of law which requires a plaintiff in attachment to give any notice of the pendency of the suit except such notice as is required by the act to be published, but in view of the circumstances of this case, considering the severance of the obligation, the surreptitious manner of conducting the attachment proceeding, the fact that a lot of land worth from $750 to $900 ■was purchased by the plaintiff in attachment for $25, subject to something over a hundred dollars in liens, I do not think it would be equitable to permit .the plaintiff in attachment to avail itself of the proceedings.

There is yet another point which touches the validity of the attachment proceeding. The affidavit on which the attachment is based declares that Joseph Bray is a non-resident, and that he owes a debt to the engineering company. As a matter of fact, the claim which the General Engineering Company prefers against Mr. Bray is a claim based on a covenant that sounds in damages, and not only is his affidavit, therefore, untrue, but the fact places the claim beyond the reach of the ordinary attachment suit. In Barber v. Robinson, supra, the attachment was in covenant, but in that case the covenant was that the defendant would pay a certain amount of cash in a certain contingency. The difference between an attachment of that character and an attachment for unliquidated damages is shown by the case of Cheddick v. Marsh, 21 N. J. Eq. (1 Zab.) 463, where it was held that a writ of attachment would not issue for a penalty intended to secure unliquidated damages. See, also, Heckscher v. Trotter, 48 N. J. Law (19 Vr.) 419, and Wynant v. Nautical Preparatory School, 27 N. J. L. J. 202.

I conclude, therefore, that the proceedings by which the General Engineering Company was enabled to take title to the defendant’s lands must be disregarded and the deed and all the proceedings upon which it was founded set aside. This measure of relief, however, will be awarded upon condition that the complainants do equity. The decree will provide that upon payment to the General Engineering Company of the amount paid by it to satisfy the municipal liens above mentioned, with in-, terest, within twenty days after the date of this decree, the said proceedings shall thereupon become null and void, and upon such payment, or the tender thereof within that period, the Gen-. eral Engineering Company shall reconvey the said premises to the defendant Joseph Bray and discontinue and cancel the said attachment proceedings.

The decree will be without costs in favor of either party against the other.


source: Caselaw Access Project

author: Ho well, Y. C.

license: Public Domain

text:
    William H. Groff et al. v. Margaret B. Stitzer et al.
    [Submitted March 17th, 1909.
    Decided April 29th, 1909.]
    1. Evidence, in a suit by executors to set aside transfers of corporate stock made by testatrix on the ground of her mental incapacity, held to show that testatrix was so enfeebled by disease as to render it improper for her to transact any important business without assistance of some person who could give her independent advice.
    2. Where a person enfeebled in mind by disease or old age is so placed as to be likely to be subjected to the influence of another, and makes a voluntary disposition of property in favor of that person, proof that the donor understood the nature of the act, and that it was not done Lhrough the influence of the donee, is essential, and the presumption is against the validity of the gift.
    3. A woman living with a stepdaughter and her son suffered a stroke of paralysis resulting in the impairment of her mental vigor and making it necessary for her to rely for her safety and comfort on the stepdaughter and son. She was under the influence of the stepdaughter.-—■ Eeld, that a voluntary transfer by her of corporate stock to the stepdaughter and her son was presumptively void, and the burden of proof rested on them to show that she understood the nature of the act and that it was not done through their influence.
    4. Under P. L. 1900 p. S63 g If, providing that a party to any transaction with a decedent shall not be permitted to testify thereto, donees of corporate stock, when sued by the representative of the deceased donor to set aside the gift, are incompetent to testify to the transactions with the donor.
    5. In a suit by executors of a deceased donor to set aside a gift of corporate stock, evidence held not to show that the donor understood the nature of the act, and that it was not done through the influence of donee, essential to the validity of the gift.
    6. A voluntary transfer of corporate stock, in consideration of the donor receiving the dividends and the donee rendering services to the donor for life, is void when the agreement relating to the dividends and support is not reduced to writing.
    7. The knowledge possessed by the cashier of a bank must be attributed to the bank, and, where the cashier had information sufficient to put him on inquiry, the bank was bound to make the inquiry.
    8. A person receiving corporate stock from the owner delivered it to a bank as collateral security for a loan. The stock stood in the name of the owner on the books of the corporation. Before making the loan the bank knew that the owner was an invalid to such an extent that she could not make a reply to the cashier’s inquiry by letter and that the stock belonged to her. The bank on making inquiry would have learned that she had been stricken by paralysis resulting in loss of mental vigor to such an extent as to incapacitate her from transacting business.—Held, that the bank was chargeable with what it could have learned by inquiry, and it could not hold the stock as collateral as against the executors of the owner seeking to set aside the transfer on the ground of mental incapacity.
    Tlie bill in this case is filed by the executors of the will of Caroline Bowers, deceased, to set aside a transfer made by Mrs. Bowers in her lifetime of thirty-two shares of the capital stock of the Essex County National Bank of Newark, evidenced by two certificates of sixteen shares each standing in her name on the books of the bank. The transferees are James H. Stitzer, Jr., and his mother, Margaret B. Stitzer.
    In the month of March, 1906, Mrs. Bowérs was living with her husband in Hackettstown; she was his second wife. Mrs. Margaret B. Stitzer, one of the defendants, was the daughter of his'first wife, and James H. Stitzer, Jr., another defendant, is the son of the said Margaret B. Stitzer. There was therefore no blood relationship between Mrs. Stitzer and her son on the one hand and Mrs. Bowers on the other, Mrs. Bowers being Mrs. Stitzer’s stepmother. On March 19th, 1906, Mrs. Bowers was stricken with paralysis, and it is claimed on the part of the complainant that she was thereby deprived of her reason and understanding to such an extent that she was incapacitated from transacting any business. Later in the year her husband died. She was thereby left without anyone upon whom she could rely for business advice.
    On June 10th, 1907, she endorsed the two stock certificates with her name. These signatures were witnessed by Mrs. Stitzer and the certificates so endorsed were delivered to James H. Stitzer, Jr., who took them with him to Philadelphia, where he resides. A short time after he offered them to the Quaker City National Bank as collateral security for a loan. The shares then stood in the name of Mrs. Bowers on the books of the Essex County National Bank. Before making the loan, and on June 25th, 1907, the cashier of the Quaker City Bank wrote a letter to Mrs. Bowers at Hackettstown, of which the following is a copy:
    "Mr. James Herbert Stitzer, Jr., has left with us thirty-two (32) shares of the Essex County National Bank, standing in your name and endorsed by you with the signature of Margaret B. Stitzer as witness.
    “As is customary in such cases I wish to confirm the genuineness of your signature to the certificates, there being two of sixteen shares each. Mr. Stitzer advises me that you are quite an invalid. You can therefore have someone else write the letter simply stating the signature is correct, if such is the case, then you sign it.
    “Yours very truly,
    “W. D. Brelseohd,

      “Cashier.”

    On June 27th Mrs. Stitzer wrote with her own hand a reply thereto which was signed by Mrs. Bowers and herself, of which the following is a copy:
    “Hackettstown, June 27th, 97. (’07)
    “Dear Sir—-Your letter is received. Mrs. Bowers is quite an invalid, but I will have her sign this letter same as the certificates' which she signed. I hope it will prove satisfactory.
    “Yours,
    “M. B. Stitzer. “Caroline Bowers.”
    Thereupon the certificates were retained by the bank and it began to make loans to Stitzer on the security thereof. The following loans were made to him: July 1st, 1907, $1,000; July 6th, 1907, $1,000; August 3d, 1907, $1,000; October 1.2th, 1907, $1,300, making a total of $4,300.
    On October 14-th, 1907, while the shares were still under pledge to the Quaker City National Bank, Mrs. Bowers executed a power of attorney to transfer them to Mrs. Stitzer. The transfer was actually made on the books of the Essex County National Bank on November 13th, 1907. Mrs. Bowers died two days later, on November 15th. The defendant James II. Stitzer, Jr., claims that the shares were loaned to him by Mrs. Bowers for the purpose of enabling him to use them as collateral security for a loan or loans which he might negotiate, and Mrs. Margaret B. Stitzer claims that the transfer to her was made in consideration that she should remain with and take care of Mrs. Bowers during the rest of her life. The two transactions are thus claimed to have been entirely independent of each other.

      Mr. James Fisher and Mr. Joseph M. lioseberry, for the complainants.

      Mr. F. Morse Archer, for the defendants.
   Ho well, Y. C.

It is claimed on the part of the complainant that both the above-described transactions are void and should be set aside upon the ground that Mrs. Bowers was of unsound mind when she endorsed the certificates in June, 1907, and when she executed the final power oE attorney to transfer the shares in October, 1907, and that if she should be found to have been of unsound mind, or incapacitated mentally for the transaction of business, the Quaker City National Bank cannot retain the shares upon the ground that it is a bona, fide holder for value, for the reason that it had notice that the shares belonged to Mrs. Bowers and that it was put upon inquiry ás to her mental capacity by the correspondence of June, 1907, herein above copied, and the other facts within its knowledge.

It will be observed that on neither of the occasions above referred to was there any writing executed between the parties evidencing the purpose for which the transfers were made, or the consideration which induced them. The transaction so far as it relates to James H. Stitzer, Jr., is put by him upon the sole ground that it was a loan of the stock for the purpose of procuring credit for himself, and on- the part of his mother it was put upon the ground that she had agreed to live with her stepmother and take care of her during the term of her life.

The first inquiry will be directed to the mental condition of Mrs. Bowers on June 10th and October 14th, 1907, the former being the day on which she endorsed the stock certificates over to James H. Stitzer, Jr., and the latter the day on which she made the final transfer of the shares to Mrs. Stitzer. The most impressive testimony on this subject is that of the two physicians who were sworn on behalf of the complainant. Dr. Woodruff was called to attend Mrs. Bowers on the day on which she was stricken; he attended her until the following month of September and became very familiar with her physical and mental condition. He testifies that he saw her within an hour after her stroke; that she was then lying on a couch in a stuporous condition, her left side, face, arm and leg being paralyzed; that her face was drawn to one side; that she could not talk, and did not know where she was or what had happened to her. During the time Dr. Woodruff attended her, her condition remained about the same, except that her face righted itself more or less, but her tongue continued to deviate to the paralyzed side, and her speech was thick, and she was not mentally bright. Dr. Woodruff again saw her two to four weeks before she died. She had then, he says, failed very much both physically and mentally, and could not carry on an intelligent conversation; an attendant was always necessarjc

Dr. Yan Syckel was first called to treat Mrs. Bowers professionally on September 25th, 1907, nineteen days prior to the October transaction. He saw her again several times during the last ten days of her life. He testified that her intellect was impaired, that she could not carry on a conversation intelligently, sometimes manifesting her weakness by crying and laughing suddenly and abruptly without ability to control her emotions. He says: “She was fair, not bright. She was paralyzed; entirely helpless,” and that her condition did not improve during his attendance.

Many unprofessional witnesses were called by the complainant who testified to similar instances of weakness on the part of Mrs. Bowers, and although, perhaps, nearly as many witnesses on the other side testified to her uniform intelligence and mental-capacity, I am driven to the conclusion, by a careful perusal of all the evidence, that the statements of the two physicians reflect the true condition of Mrs. Bowers’s mind. It is hardly possible that Mrs. Stitzer could have remained long in the same house with a person afflicted as these physicians say that Mrs. Bowers was without having a conviction of her incapacity forced upon her, and indeed such appears to have been the case, for according to the testimony of Mrs. Baldwin, a witness for the complainant, Mrs. Stitzer while in charge of the Bowers house wrote her that Mrs. Bowers was not any better, that she did not consider her any better, and that her mind was as bad as her body. She made a similar statement to Mrs. Dr. Van Syckel.

Among the witnesses called to support the June transaction was the wife of James H. Stitzer, Jr., who was at the Bowers homestead at the time that that transaction took place. Her statement about it is this: Her husband wanted some money, and he asked Mrs. Bowers if he could have her bank stock to borrow money on; that he explained to her just exactly what he would do with it, and how she would get the dividend, and that it would not interfere with her receipt of the dividends in any way, and then she says that he asked her over and over again, several times, if she knew just why she was doing it, because he wanted her to understand thoroughly what she was doing, and that she seemed to be perfectly willing and satisfied. This evidence, instead of making for the defence, is really in favor of the complainants. It shows that even Mr. Stitzer at that time must have had doubts about the mental capacity of Mrs. Bowers, and about the validity of the transaction on which he was about to enter.

Mr. Seymour R. Smith, another witness for the complainant, was subscribing witness to the execution of the power of attorney in October, 1907. He is president of a bank and is a man of high intelligence and of large experience in important affairs. He was called in by Mrs. Stitzer because she had learned that the document should be witnessed by some bank official. When he reached the house he found Mrs. Bowers sitting at a table; he was told by Mrs. Stitzer that Mrs. Bowers wanted to transfer the stock to her, and that she wanted him to witness the signature. He filled in some blanks in the document and laid the same in front of Mrs. Bowers, telling her what it was; either he or Mrs. Stitzer gave Mrs. Bowers a pen, and she began to write; she found difficulty in spelling her name, and Mr. Smith was obliged to help her out by pronouncing some of the letters that she was to write. During all this time Mrs. Bowers did not speak, and after Mr. Smith left the house he seems to have been so struck by the singularity of the transaction that he returned to ask her if she knew she was signing a transfer of bank stock and whether she wanted to do it, to which she replied “yes.”

There is much testimony to show that Mrs. Bowers was helpless, that she was nervous, that she would cry frequently without apparent cause, and would laugh unnaturally; that she would sit by the day and look blankly out of the window, that she had lost her memory, and, on the other hand, that from the time of her stroke to the middle of the following year she improved somewhat and was able to move about the house without much assistance,.and to talk intelligently. Yet I think that the result of the testimony is that her mind was enfeebled by her disease to such an extent that she should not have been permitted to transact any important business without the assistance of some person who could have given her independent and friendly business advice, although the ease is not one to which the doctrine of “independent advice,” illustrated by Slack v. Rees, 66 N. J. Eq. (21 Dick.) 447, and Post v. Hagan, 71 N. J. Eq. (1 Buch.) 234, applies in all its force, for it appears that she did not dispose of all her property.

I think it fully appears that not only was Mrs. Bowers’s mind impaired and her mental vigor diminished much below its normal state, but that she was under the influence and domination of Mrs. Stitzer, upon whom she was obliged to rely for her safety and comfort. The law respecting the relations between persons so situated has been fully laid down in a long line of cases. In Haydock v. Haydock (1881), 34 N. J. Eq. (7 Stew.) 570, the court of errors and appeals, speaking by Mr. Justice Reed, says: “I take the rule to be settled that when a person enfeebled in mind by disease or old age is so placed as to be likely to be subjected to the influence of another, and makes a voluntary disposition of property in favor of that person, the courts require proof of the fact that the donor understood the-nature of the act, and that it was not done through the influence of the donee. The presumption against the validity of the gift is not limited to those instances where the relation of parent and child, guardian and ward, or husband and wife, exists, but in every instance where the relation between the donor and donee is one in which the latter has acquired a dominant position.”' The opinion cites the case of Huguenin v. Baseley, 2 L. C. Eq. 1183, and notes. The rule was followed by Vice-Chancellor Van Fleet in Farmer v. Farmer (1884), 39 N. J. Eq. (12 Stew.) 211; in support of it he makes the following quotation from the opinion of Judge Hank in Cowee v. Cornell, 75 N. Y. 91: “It may be stated as universally true that fraud vitiates all contracts, but as a general thing it is not to be presumed, but must be proved. Whenever, however, the relations between the contracting parties appear to be of such a character as to render it certain that they do not deal on terms of equalitjr, but that either on the one side, from superior knowledge of the matter derived from a fiduciary relation, or from overmastering influence, or, on the other, from weakness, dependence or trust justifiably reposed, unfair advantage in a transaction is rendered probable, then the burden is shifted, the transaction is presumed void, and it is incumbent on the stronger party to show affirmatively that no deception was practiced, no undue influence was used, and that all was fair, open, voluntary and well understood.”

The doctrine is repeated in the opinion of Vice-Chancellor Green in Mott v. Mott (1891), 49 N. J. Eq. (4 Dick.) 192, and in the opinion of Vice-Chancellor Pitney in Thorp v. Smith (1902), 63 N. J. Eq. (18 Dick.) 70; affirmed, 65 N. J. Eq. (20 Dick.) 400. There the court of errors and appeals, quoting from the opinion of Vice-Chancellor Pitney, says: “The mortgagor was advanced in years, in feeble health, naturally of weak will, with mental powers weakened by cerebral disease, so that he did not appreciate his pecuniary circumstances and moral obligations, and was‘unable clearly to discern and discreetly to judge of all those things and all those circumstances which enter into the nature of a rational, fair and just disposition of his property.” The court of errors and' appeals continuing, says: “While in that condition he was subjected to the influence of the defendant, and executed the mortgage without having the benefit of the advice of independent and disinterested counsel, given in the absence of the mortgagee, to make him fully understand, realize and appreciate the full effect and consequences of the instrument in all its bearings.” See, also, Baur v. Cron (1906), 71 N. J. Eq. (1 Buch.) 743.

This rule relating to the burden of proof is a rule of universal application in this class of cases, and must be applied here to the ease of the defendants. It may be unfortunate that their mouths are closed by section 4 of the Evidence act (P. L. 1900 p. 362), so that they are not permitted to give their version of these transactions with the deceased, yet the court inust look at the testimony with the limitations that the law has placed upon it, and a careful examination of the testimony shows that the burden placed upon the defendants has not been met.

I think that this, of itself, would be sufficient to avoid the transaction as between the complainant on the one hand and Mrs. Stitzer and her son on the other, but there are yet other considerations that were urged on behalf of the complainants arising out of the failure to put in writing the agreements which Mrs; Stitzer and her son say were to be performed by them, respectively, with relation to the dividends on the bank shares and to the care of the donor during her life. It was attempted to be shown that, notwithstanding the loan of the shares to Mr. Stitzer as collateral security in June, Mrs. Bowers was to continue to receive the dividends, and in the October transaction that Mrs. Stitzer should render services to the donor during the term of her life, neither of which reservations were put in writing. It was held in Mott v. Mott, supra, that in a voluntary transfer in consideration of support the omission of the agreement to support rendered the whole transaction fraudulent and void. In Mulock v. Mulock, 31 N. J. Eq. (4 Stew.) 594, a son procured a conveyance from his aged mother upon conditions to be performed by him. The conveyance was held to be fraudulent and void because the reservations were not secured as perfectly as was the grant, and in White v. White (1900), 60 N. J. Eq. (15 Dick.) 104, Vice-Chancellor Pitney collects all the cases, and styles the omission of the reservation in such cases a fatal defect. The rule plainly applies to the matter of the dividends as well. ‘

Having reached the conclusion that these transactions are void so far as Mrs. Stitzer and her son are concerned, it becomes necessary next 'to inquire whether their infirmity reaches to the Quaker City National Bank, which holds the shares in pledge for loans to Mr. Stitzer, and this depends upon the knowledge that the bank had or was chargeable with as to the mental condition of Mrs. Bowers in June, 1907. On June 25th of that year the cashier of the bank addressed a letter to Mrs. Bowers in which he stated that Mr. Stitzer had left with it the Essex county bank shares standing in Mrs. Bowers’ name and endorsed by her with Mrs. Stitzer as a witness, and that he wished to confirm the genuineness of Mrs. Bowers’ signature. Then follows this statement:

“Mr. Stitzer advises me that you are quite an invalid. You can therefore have someone else write the letter simply stating the signature is correct, if such is the ease, then you sign it.”

Two days later Mrs. Stitzer, with her own hand, replies to the cashier’s letter, in which she says: “Mrs. Bowers is quite cm invalid, but I will have her sign this letter same as the certificates which she signed.” Whatever knowledge the cashier had of Mrs. Bowers’ condition must be attributed to the bank, and if the cashier had any information which was sufficient to put him on inquiry, the bank would be bound to make the inquiry. Gaston v. American Exchange National Bank, 29 N. J. Eq. (2 Stew.) 98.

The facts that the bank knew were—first, that Mrs. Bowers was “quite an invalid;” second, that she was so far invalided that she would not be able to make a reply to the cashier’s inquiry by a letter written by her own hand; third, that the stock in question belonged to Mrs. Bowers. This last fact is admitted by the answer of the bank. Having this notice, was there not a duty cast upon the bank to inquire into the extent, nature and character of her invalidism? The first question that might occur to one upon whom this burden was cast would naturally be one relating to the character of her disease. This might have been made of Mr. Stitzer, who was at hand, or it might have been prosecuted at Hackettstown. If, in reply to the inquiry, the bank had been informed that Mrs. Bowers had been stricken by paralysis, could it then have stopped its inquiries and proceeded to make the loan, with any degree of safety? With the well-known effects and results of this malady in mind, could the bank then have safely proceeded without going to the limit of investigation? I am of the opinion that the bank was put upon inquiry as to her state of health and the condition of her mind; that such inquiry was a duty which it could not shirk, and that it was bound by all the facts that such inquiry, if made, might lead to. This view charges the bank with knowledge of Mrs. Bowers’s mental condition when it took the securities and made the loans,

Tn my opinion, therefore, the complainant should have the decree.


author: Walker, V. C. Walker, Y. C.

text:
    Francis E. Larkin et al. v. James H. Wikoff et al., trustees, &c.
    [Decided February 6th, 1909.]
    1. A church property was conveyed to trustees to be used for gospel preaching and religious services free to all the people of the neighborhood; the several Christian denominations, Presbyterian, Methodist, Baptist and Reformed Dutch, to be accorded equal rights in preaching alternately on the Sabbath. The donor also placed in the hands of the trustees a sum of money to be invested and the income to be appropriated to keeping the church edifice in repair and to provide a fund for the payment of such pastors as might be employed from time to time to conduct the services in the church. Power was given to the trustees to decide upon the discontinuance of the services so provided for whenever it should seem clearly expedient so to do, and to sell the church property and hold the proceeds of sale together with the donated fund upon a certain other trust. The trustees resolved that it was expedient to discontinue and abandon the use of the church for gospel preaching and religious services for certain reasons which they deemed sufficient, they being by the deed of trust constituted the judges and fully authorized to decide the question. Certain residents of the immediate vicinity of the church filed the bill in this cause, alleging that the proposed sale was in disregard of the trust created by the donor, and they prayed for an injunction restraining the trustees from selling or conveying any part of the church property.—Held (1) that the bill should have been filed on behalf of the complainants and all others similarly interested in the subject-matter of the suit; and that the attorney-general, representing the public, should have been joined with them, in which case the pleading would be a bill and information, or, the attorney-general should have been made a party defendant to the bill; but the pastors who conduct the services are neither cestuis que trust nor trustees under the deed, and, not being necessary parties, were rightly omitted from the bill; (2) an amendment may be allowed upon the hearing so as to make the complainants sue on behalf of themselves and the rest of the class interested with them; and the attorney-general may now be charged as a defendant and brought in by process; (3) the case being- disposed of on the merits as between the present parties to the record, if the attorney-general should be satisfied that a right conclusion has been reached he may file a formal answer and submit to the judgment of the court; if he should file a litigious pleading against the defendant trustees the case will be opened to take additional proofs, in which event the whole question at issue will be open; (4) the doctrine of ey pres, that is, the doctrine that a fund for charity impossible of application according to the intention of the donor shall be applied as nearly as may be according to his intention, obtains in this state; but the doctrine cannot be applied where the donor himself has directed what disposition shall be made of the trust property in the event of -the failure of the charitable use to which he directed it should be devoted; (5) where power is given to trustees to do a particular thing, they being constituted the judges and fully authorized to decide the matter, the court has no jurisdiction to command them as to the exercise of that power, provided their conduct be bona fide in all respects.
    2. If reasonable grounds exist for coming into court to obtain the construction of the instrument creating a trust, the practice is to allow the costs and expenses, as respects all parties, and as between solicitor and client, out of the trust funds; and this, whether the instrument creating the trust be a will or a deed.
    On final bearing. On bill, answer, replication and proofs.
    The bill alleges that the complainants reside in the immediate vicinity of the Cedar Grove church in the'township' of Princeton, and that they and their families are members of and contribute to the support and maintenance of the respective churches and denominations named in the deed of trust made by the late Paul Tulane to the trustees of the First Presbyterian congregation at Princeton, on May 27th, 1876, and have been and are constant attendants at the services held in the church edifice at Cedar Grove, as well as attendants at the Sunday school held therein on each and every succeeding Sunday. The conveyance was a grant of a tract of land, with a church edifice erected upon it, in trust, to be used for gospel preaching and religious services, free to all the people of the neighborhood; the several Christian denominations, Presbyterian, Methodist, Baptist and Reformed Dutch, to be accorded equal rights in preaching alternately on the Sabbath,/according to a plan or programme to be declared and made known by the party of the second part, as nearly like the plan that had theretofore been and then was accepted and carried out by the grantor as could be; the preaching in the chapel was expected to be done chiefly by the pastors of the several denominational churches aforesaid, which were represented by families residing in the vicinity of Cedar Grove as theretofore, but thenceforth under the supervision and arrangement of the party of the second part; and in further trust that whenever thereafter the use of the chapel for the purpose aforesaid should have been necessarily abandoned or discontinued through the neglect of the people to attend upon the services, or through the failure of the several pastors to preach in the chapel, or through the waste or destruction of- the building, or whenever from any cause which should seem to the trustees clearly expedient, to discontinue the plan of holding the property for such user as aforesaid, they, the trustees, being the judges and fully authorized to decide such discontinuance from all or any cause whatever, then and in such case of nonuser, abandonment, or discontinuance, the trustees should hold the land and all buildings thereon as the property of the trustees for the use of the said First Presbyterian Church of Princeton, with power to sell the same, and to convert it into money, and to hold the money arising; from the sale thereof forever in fee, for the use of the said First Presbyterian Church aforesaid, of which they are the trustees, for meeting and defraying the contingent and ordinary expenses of said church and congregation. The deed of trust was duly executed and delivered and accepted by the trustees of the First Presbyterian Church of Princeton, who immediately took possession of the land and premises described therein, and entered upon the execution of said trust, and have ever since continued to act in accordance with the terms, conditions and requirements in the deed.particularly specified to be carried out and performed on their part as such trustees, so that the church edifice has from May 27th, 1876, up to the time of filing the bill, been continuously used and occupied on each and every succeeding Sabbath by the various denominations of Christian worshipers named in the deed, which religious worship was presided over and the preaching in the chapel was conducted by the pastors of tbe several denominational churches aforesaid. In addition to the religious services there has been held in the edifice a union Sunday school, so called, composed of the parents and scholars of the various Christian denominations residing in and around the vicinity, and which said school has been conducted regularly up to the present time with the full knowledge and consent of the trustees; that the country surrounding the church is thickly settled and that the nearest house for religious worship in the community is at a distance of three or four miles, and that it was especially in view of that fact that Mr. Tulane, in his lifetime, purchased the land and premises and conveyed it in trust to the defendants for the sole and exclusive object and purpose that the inhabitants of the community might enjoy in perpetuity the means and advantages of religious worship; and in order to further secure said object Mr. Tulane, in his lifetime, by another deed of trust, placed in the hands of the defendants, trustees, the sum of $5,000 to be by them invested in good securities and the income arising therefrom to be appropriated exclusively—first, to the keeping of the church edifice in proper arid sufficient repairs, and second, to provide a fund for the payment of such pastors as might be employed from time to time to conduct the services in the church in accordance with tbe wishes and instructions of Mr. Tulane, as expressed by him in the two deeds of trust.
    '"'I By an advertisement inserted in the Princeton Press newspaper on June 22d, 1907, the trustees advertised the sale on Saturday, June 29th, 1907, at the Nassau Inn, Princeton, of the premises described in the trust deed, the advertisement stating the sale would be had by virtue of the provisions of the trust deed aforesaid and by virtue of the authority of resolutions of the board of trustees passed May 22d, 1907.

      The complainants charge that this attempt to sell the property is' in disregard of the terms of the trust reposed in the trustees/ and that they apprehend that the trustees intend to sell and convey the church edifice and lands described in the deed, and thereby the church may be closed and the complainants and the residents of the community in and about the church may he deprived of the use and the conveniences of religious services contemplated by the donor, and that the trustees intend to appropriate not only the money arising from the sale of the said premises, but also to appropriate to their own use the said sum of $5,000, which was set apart by Mr. Tulane to aid and maintain in perpetuity the services to he carried on in the church edifice, as specified in the deed of trust.''They pray, among other things, that the defendants may be enjoined from selling or conveying away any part or parcel of the church property..
    The defendants answered and admit the making, execution and delivery of the trust deed, and they say that while the deed was delivered to and accepted by them on May 29th, 1876, yet the donor wished to, and in fact did, personally supervise and look after the church for several years, and from the time he gave up his personal supervision (not saying when) the trustees in the deed entered upon the execution of the trust and since and up to June 29th, 1907, supervised and executed the trust strictly in accordance with the letter and spirit of the deed and the plan of the donor. They say that they believe a Sunday school of the parents and children residing in the vicinity of Cedar Grove has been held in the church edifice, but deny that the school if organized or the individual members thereof have acquired any rights in the premises; that the .abandonment and sale of the church will not necessarily deprive the people of Cedar Grove, who desire it, of gospel knowledge, as there is a schoolhouse within a few rods of the church which might be available for Sunday school services; they deny that Mr. Tulane purchased the tract of land and premises and conveyed it in trust to the defendants for the sole and exclusive object and purpose in that behalf in the bill of complaint alleged to have been expressed in the deed of trust, and they assert the fact to be that Mr. Tulane did give to them, the trustees, on or about May 29th, 1876, the sum of $5,000 to be held by them, and to be securely invested, and the income thereof annually to be applied in defraying the expenses of maintaining free preaching and religious services in the chapel or church at Cedar Grove, in paying the salary of a sexton, and the cost of fuel, and keeping the house in order, and in compensating the pastors of the several churches who are expected to preach alternately on the Sabbath, under'a plan of arrangements to be prescribed by the trustees, following as nearly as can be the plan then observed by Mr. Tulane ; the several Christian denominations, the Presby.terian, the Baptist, the Beformed Dutch and'the Methodist congregations adjoining, to be equally admitted to the use of the preaching services under the plan to be made by the trustees, so as to carry out what they believe to have been the wish of Mr. Tulane in creating the trust, and as set forth in the trust deed for the church property, which he conveyed to them, and whenever the church shall have ceased to be used for preaching and holding religious services therein and shall have been sold and abandoned for use as aforesaid, then to hold the $5,000 for the use of the First Presbyterian Church of Princeton, to be applied for meeting the contingent and ordinary expenses of the church and congregation; that the defendants, trustees, received the sum of $5,000, and used the income therefrom in accordance with the terms of the trust; that they have advertised and it was their purpose to dispose of the church edifice and the land accompanying the same at public auction, but they deny that the intended sale was in disregard of the terms of trust reposed in the trustees, and say that their action in the abandonment of the use of the church property for church services and the proposed sale thereof were in strict conformity with the terms of the trust deed, and the terms of the trust above set out; that the defendants deny that they intended to appropriate not only the money arising from the sale, but also the said sum of $5,000 to their own use, but assert the fact to be that on or about May 22d, 1907, at a duly convened meeting of the board of trustees of the First Presbyterian Church at Princeton, by resolution and in accordance with the terms of the said trusts, it was deemed expedient to discontinue and abandon, on and after July 1st, 1907, the use of the property described in the complainants’ bill, and the church edifice for gospel preaching and religious services—'first, because the people in the neighborhood of Cedar Grove neglect to attend upon the services, and the few persons who do attend are connected with other churches in the vicinity and within easy reach of their respective churches; second, because the people in the vicinity of the church take little or no interest in the services or the work being done for them; thvrd, because it would be a waste and perversion of the trust to longer continue preaching services at Cedar Grove, and that thereafter the church property and building be held for the use of the First Presbyterian Church at Princeton, until the same could be sold, when the proceeds therefrom should be used for meeting and defraying the contingent and ordinary expenses of said church and congregation as provided by the terms of the trust deed; and it was further determined by said resolution to sell the premises described in complainants’ bill of complaint to the highest bidder at public vendue; that at the meeting of May 22d, 1907, it was determined by another resolution of said board of trustees of the First Presbyterian Church at Princeton, that inasmuch as the Cedar Grove church is to be abandoned and discontinued for preaching and the holding of religious services on the 1st day of July, 1907, for causes satisfactory to the said trustees, within the terms of said trust, that the said sum of $5,000, together with the accumulated unused income thereon, be, on and after July 1st, 1907, held for the church and congregation aforesaid and the income therefrom used and applied toward paying the contingent and ordinary expenses of said church and congregation, as provided in the terms of said trust; that the decision of the trustees to abandon and discontinue the use of the church and to sell the same and to hold the proceeds together with the said trust fund, which provided, among other purposes, for the defraying of expenses for maintaining free preaching in the Cedar Grove church, in trust for and to apply the same in paying the contingent and ordinary expenses of the First Presbyterian Church of Princeton, was only reached after careful investigation of the conditions that existed at Cedar Grove and the esereise in absolute good faith of the best judgment of the trustees based upon the facts, who by said deed of trust were made the judges and were fully authorized to decide upon said discontinuance for reasons other than those specifically mentioned in the deed of trust, as well as those named in the answer; that for several years past the trustees have believed that the time was near approaching when it would be their duty under the terms of the trust to discontinue the use of the church at Cedar Grove for religious services because of lack of work and attendance upon the services, and it seemed that the object of the trust was no longer being obtained, yet the trustees felt that the step to discontinue the services should not be taken until they were fully persuaded that the objects of the trust were not being fulfilled, and if they have erred at all it is in not long ago discontinuing the services, and while they have believed and still believe that the trust deed fully authorizes them to decide in good faith upon the discontinuance of the preaching services and the termination of the trust for the benefit of Cedar Grove from all or any causes whatever in addition to the grounds specifically mentioned therein, and while they are not obliged under the terms of the trust to give reasons for their action, yet, in order to show the court their absolute good faith in their decision, they would say that the following are some of the circumstances which led up to their decision and the facts upon which their judgment was based: (a) That within the past year and a half they have received communications from the session of the First Presbyterian Church and from certain of the pastors who supply the pulpit at Cedar Grove, advising them of the conditions existing at Cedar Grove and recommending the discontinuance of the religious services as carried on under the terms of the trust; (6) that the community in the vicinity of Cedar Grove has changed since the establishment of the church; that Mr. Tulane, who was the son of a French Huguenot immigrant, bought the church from the Methodists to provide a convenient place of worship for his own countrymen in that community; that none of the people for whom the trust was originally established are now living at Cedar Grove, nor their descendants, so far as the defendants are able to learn; (c) that almost without exception the religious people now in Cedar Grove are connected with 'churches in Princeton, Hopewell, Blawenburg, &c., and are in easy reach of their respective churches, the most remote being not more than fohr miles from a church of his own denomination; (d) that the services of recent years have been poorly attended, the average at a preaching service being fifteen in fair weather and at times an attendance of only four people upon said services, the people taking little or no interest, in the work being done, there frequently being' no one to play the organ; (e) the pastors who supply in turn the pulpit are agreed that the services as now carried on are not sufficiently -needed or appreciated- to justify their continuance, the only possible exception being the Baptist minister at Hopewell, who has some parishioners who find it more convenient to attend upon his preaching at Cedar Grove than in Hopewell; (/) that the abandonment and sale of the church as provided by the trust will not necessarly deprive the people of Cedar' Grove who desire to attend, of gospel privileges, in fact, it is not and has not been the desire of the trustees to close the Cedar Grove church and discontinue the services, but it seemed that it was their clear and plain duty to do so under the terms of the trust and plan of the donor; that there is a schoolhouse within a few rods of the church, which might be available for Sunday school and preaching services should the people desire such work to go on; besides that it is not unlikely that in the event of a sale, the church may be bought by some denomination of Christians wlm would better serve the community than is done under the provisions of the trust that prevents any responsible leadership or control in the pastoral work; the plan of the donor seems to' have utterly failed in the conduct of the services at Cedar Grove; (g) that it would be a perversion of the trust and a neglect of the defendants’ duties as trustees if they longer continued the use of the trust property for the maintenance of services at ‘ Cedar Grove as provided in the trust.
    -^The defendants admit that although the complainants may have an interest in the subject-matter of the suit, yet they say that they are not answerable alone, but as well to all other persons residing in the neighborhood of the Cedar Grove church, and that the bill should have been filed by the complainants on behalf-of themselves and all other persons residing in the neighborhood, who would come in and contribute to the expenses of the suit, and that the complainants should not be allowed to proceed without making parties the respective pastors of the Presbyterian, Methodist, Baptist and Reformed Dutch churches, which are represented by the families residing in the vicinity of and who supply the pulpit in the Cedar G-rove church in accordance with the terms of the trust, the interest of whom a decree in this cause must directly and essentially affect (giving the names and addresses of the pastors), and praying to have the same benefit of this defence as if they had demurred to the bill, j,

      Mr. Adrian 8. Appelget and Mr. George 0. Vanderbilt, for the complainants.

      Mr. John V. B. Wicojf, for the defendants.
   Walker, V. C.

The- right of the complainants to maintain this suit being challenged, that question will be examined before proceeding to the consideration of the cause upon its merits. Two grounds of objection are named in the answer, and for which the benefit of a demurrer is prayed, namely—first, that while the complainants may have an interest in the subject-matter of the suit, yet their hill should have been filed on behalf of themselves and all other persons residing in the neighborhood of the church who would come in and contribute to the expenses of the suit, and second, that they should not be allowed to proceed without making parties the respective pastors of the Presbyterian, Methodist, Baptist and Dutch Reformed churches, who supply the pulpit, and who, it is said, have a direct interest which may be affected by the decision of this cause. A third objection was urged upon the argument, and that is, that the attorney-general is a necessary party in this proceeding. These objections will now be considered together.

In several cases in this state bills were filed by a limited number of individuals who were interested in a charitable trust and the rights of the parties were adjudicated without the presence of the attorney-general and without the bills having been filed on behalf of the complainants and all others who were interested witli them in the subject-matter. Of this class of cases Ludlam v. Higbee, 11. N. J. Eq. (3 Stock.) 342, and Mills v. Davison, 54 N. J. Eq. (9 Dick.) 659, are examples. But in MacKenzie v. Trustees of Presbytery, 67 N. J. Eq. (.1 Robb.) 652, the court of errors and appeals, speaking by Judge Green (at p. 685), cited Mills v. Davison, and intimated that if strict regard for practice would have made it proper that the attorney-general be a party to such suits, that all that need be said is, that the matter was passed sub silentio, and that such cases are not authority in point of practice either pro or con. He then went on to expressly decide the point because the standing of the complainants as suitors had been attacked by the defendants, and cited Attorney-General v. Moore’s Executors, 18 N. J. Eq. (3 C. E. Gr.) 256; S. C., 19 N. J. Eq. (4 C. E. Gr.) 503, in which the procedure by an information by the attorney-general ex relatione was followed, and he referred to Green v. Blackwell, 35 Atl. Rep. 375, in which the procedure was pointed out as the one proper to be followed. In this case (Green v. Blackwell) Vice-Chancellor Stevens held that a citizen of the state not being a trustee or executor and not otherwise especially interested, cannot file a bill in a case in which he seeks to do nothing more than vindicate a public right, but that in cases relating to charities he may be a relator in an information filled by the attorney-general, but that the presence of the attorney-general is indispensable.

One of the latest eases in our reports in which this question is exploited is that of Lanning v. Commissioners of Public Instruction, 63 N. J. Eq. (18 Dick.) 1, in which the attorney-general was a party defendant. The bill was filed by the complainant on behalf of himself and all others similarly situated and interested in the matters exhibited in the bill, against the defendants as individuals and as commissioners of public instruction of the city of Trenton, who had succeeded a former public corporation as trustee under a will creating a trust for charitable uses, the purpose of the trust being to establish a library for the use of the teachers and pupils of the public schools, apprentices, mechanics and such other persons as- the trustee should deem expedient and most conducive to the public good. Chancellor Magie said (at p. 8) : “As this is a public trust, the attorney-general, representing the public, is a necessary party to the litigation. The general practice seems to be that a bill of this sort •in a matter of a public trust is filed by the attorney-general, either on his own motion or on the relation of some parties interested. Tn this case the parties interested have presented the bill and have made the attorney-general a party defendant thereto. No objection to this course having been made by the attorney-general, I think the proper parties are before the court, and that it is immaterial that the attorney-general is a defendant instead of a complainant. That was the view taken by the Massachusetts supreme court in Harvard College v. Society, &c., ubi supra, 3 Gray 280, and it accords with reason.”

The case of Attorney-General v. Heelis, 2 S. & S. 67, was an information and bill by the attorney-general in which ten persons were the relators on behalf of themselves and all the other tenants and occupiers of houses and other premises situate in Great Bolton subject to the rates or assessments, and entitled to the benefit of certain acts of parliament, and the defendants were the trustees under those acts.

In cases where the relator has an interest in the matter in dispute, in which case his personal complaint being joined to and incorporated with the information given to the court by the attorney-general, the pleading forms what is called an information and bill. Dan. Ch. Pl. & Pr. (6th Am. ed.) *10.

The rule is that where property affected by a trust for public purposes is in the hands of those who hold it devoted to that trust, it is the. privilege of the public that the state be entitled to intervene by its officers for the purpose of asserting on behalf of the public generally the public’s right and interest. Ibid. *8.

Where a bill has been filed by an individual of a numerous class in his own right, the court will generally allow an amendment to be made so as to make such individual sue on behalf of himself and the rest of the class, even on final hearing. Dan. Ch. Pl. & Pr. *245. The cestuis que trustent are those for whose benefit others are seized of real or personal property. 1 Bouv. Dict. (Rawle’s Rev.) 302. The cestui que trust is the real, substantial and beneficial owner of an estate which is held in trust as distinguished from the trustee in whom the mere legal title is vested.

28 Am. & Eng. Encycl. L. (2d ed.) 1100. In the case under-consideration the cestuis que trustent are all the people of the neighborhood of the Cedar Grove church, and the trustees are the trustees of the First Presbyterian Congregation at Princeton. The pastors of the several Christian denominational churches who conduct the services at Cedar Grove are neither cestuis que trustent nor trustees under the Tulane deed; if they were either a decree could not be pronounced in this cause without their presence before the court. As it is, they are not necessary parties, and were rightly omitted from the bill.

The eoaclusions reached upon this branch of the case are that the bill should have been filed by the complainants on behalf of themselves and all others who were interested with them in the subject-matter; that the attorney-general should have been joined with them, in which case the pleading would have been a bill and information, or the attorney-general should have been made a party defendant. The result is that the bill will have to be amended so as to malee the complainants sue on behalf of themselves and the rest of the class who are interested with them, and the attorney-general will have to be made a defendant and brought into court by process before a decree can be pronounced.

The ease will be disposed of on the merits at this-time as between the parties to the record, and, if the attorney-general, after being brought in, should be satisfied that a right conclusmn has been reached, he may file a formal answer and submit to the judgment of the court. If, however, he should file a litigious pleading against the defendant trustees, the case wi'l be opened to afford him an opportunity to take proofs in addition to the testimony which is already in. In the event of this course being taken the view of the facts hereafter to be expressed will, of course, be put aside and the whole question will be considered open.

Coming now to the facts of the case, it appears that the plan of union services, so called, outlined by the donor, has been followed by the defendants. No Sunday school was ever held in the Cedar Grove church during Mr. Tulane’s time, nor until four or five years ago, when Dr. WykoJf,' the president of the board of trustees of the First Presbyterian Church of Princeton, consented to the use of the edifice for Sunday school purposes, without consulting the other trustees or receiving any authorization from them. The holding of Sunday school services in the church was not a part of the donor’s plan.

It was shown that the trust fund, originally $5,000, had accumulated, and Mr. Howe, one of the trustees and secretary of the board, stated that the full income had not been used by the defendants to keep the church in order and to pay the various salaries and encourage the work of the church, because Mr. Tulane, after giving the fund, stated that he wished to pay all the expenses of carrying on the work, and did so for the eleven succeeding years, before he died.

The average attendance upon the services of the church in Mr. Tulane’s time was from fifty to one hundred. It has gradually dwindled until during the last three or four years it has ranged from about five to twenty-five, occasionally going above the last number, the average being, perhaps, in the neighborhood of fifteen. Mr. Paul Martin, the secretary of the faculty of the Princeton Theological Seminary, was connected with the Cedar Grove church during the year 1905. He preached there steadily during the year on each Sunday when the pulpit was to be filled by the pastor of the First Presbyterian Church, and only found a congregation of six or seven people. • He thereupon made a canvass of the vicinity to ascertain the religious beliefs and church affiliations of the people and found that they were almost universally connected with some church. He inaugurated some social gatherings to encourage interest in the church, but his efforts were unavailing. The trouble appears to have been with the plan, namely, that of union services, so called, which are services conducted by pastors of various denominations, neither the services nor the congregation at any time being distinctively of a denominational or sectarian character, as I understand it. Mr. Martin says that this plan never succeeds as far as his knowledge extends. There is other testimony to the same effect, and I am satisfied this view is correct. It seems that there can be no effective organization for religious work of this kind, and that doubtless is the reason of the want of success of the union plan.

The complainants contend that the conditions require the continued execution of the trust upon the plan and according to the intentions of the donor, but, failing that, that the trust property and fund should be applied cy pres.

My judgment is inclined to be against the complainants upon the first proposition, for its seems to me that the prevailing conditions are such that the plan and intention of the donor is not being and cannot be efficiently and effectually carried out. But this question is not decided because of the power and discretion of the trustees in the premises as hereafter stated.

As to the second proposition: I think the doctrine of cy pres does not apply, because the donor by the terms of the trust has precluded its application. In this connection it should be remarked that the complainants do not point out in what way the trust property and fund can be applied cy pres. Admittedly, in a proper case, the doctrine obtains in this state.

In MacKenzie v. Trustees of Presbytery, 67 N. J. Eq. (1 Robb.) 652, it was held that a trust for public worship and instruction for the benefit of an indefinite number of persons according to Presbyterian faith and policy, with certain added provisions, appeared to be good as a charity, and that such a trust is enforceable in this state either exactly or under the doctrine of cy pres approximately, and Judge Green, speaking- for the court of errors and appeals in that case (at p. 673), quoting from Chief-Justice Beasley in Hesketh v. Murphy, 36 N. J. Eq. (9 Stew.) 304, 310, said: “When a gift has been placed in the hands of a trustee to promote a charity, which, from the mutation of circumstances had become incapable of fulfillment, such gift was to be applied by the courts, exercising a purely judicial authority, to some cognate object.” And again (at p. 675) : “The sound rule now is, at least in America, that courts will not execute charitable trusts in a manner different from that intended, unless the intent cannot in the original mode be literally carried out; that they will preserve the substance, although the mode be departed from, and that they will not presume or invent an intention which the testator or donor has not fairly indicated.”

Now, upon the authority of these cases, it is perfectly apparent that if the particular trust created by the donor is no longer capable of fulfillment owing to the changed conditions existing, the property and fund would be applied cy pres, were it not for the fact that the donor himself in the deed of gift has provided what shall be done with reference to the trust estate in the event of the failure of the object of charity which he endeavored to promote.

Of course, the doctrine of cy pres, that is, the doctrine that a fund for charity, being impossible of application according to the intention of the donor, shall be applied, as nearly as may be, according to his intention, can have no existence when the donor himself provides for the application of the fund in the event of the failure of the charitable use to which he- in the first instance directed that it should be devoted. In the deed under consideration Mr. Tulane provided that, upon failure of the trust, the •property should go to meet certain expenses of the First Presbyterian Church of Princeton. Therefore, surely, if the trust has failed, the property must be applied as the donor directed, and not upon any theory of cy pres.

The crucial point in the case is the plenary discretion given to the defendants, the trustees, to authorize and decide when to discontinue the plan of holding the property for the use expressed in the trust deed, and their action under that power.

Let it be remembered that the language of the déed is:

“Whenever hereafter the use of said Ohapel for the purposes aforesaid shall have been necessarily abandoned, or discontinued through the neglect of the people to attend upon the services; or through the failure of the several pastors to preach in said Chapel; or through the waste or destruction of said building; or whenever from any cause it shall seem to the said trustees, clearly expedient to discontinue the plan of holding the said property for such use, as aforesaid, they the said Trustees being the judges and fully authorized to decide such discontinuance, upon all or any cause whatever, then in such case of nonuser, abandonment or discontinuance, the said Trustees shall hold the said land and all buildings thereon, as the property of the said Trustees for the use of the said First Presbyterian Church and Congregation of Princeton, with full power to sell the same and convert it into money and to hold the money arising from the sale thereof, forever, in fee. for the use of the Board of Trustees of said First Presbyterian Church and Congregation of Princeton aforesaid, of which they are the Trustees, for meeting and defraying the contingent and ordinary expenses of said Church and Congregation.”

As to the $5,000 trust fund given by Mr. Tulane to the trustees under the deed, at or about the time of the delivery of that instrument, it was provided by the donor, that whenever the church should have ceased to be used for preaching and holding religious services therein and should have been sold and abandoned for such use,‘then the $5,000 was to be held for the same use as the church and land, or the money arising from the sale thereof was to be held, namely, for defraying the contingent and ordinary expenses of the First Presbyterian Church and congregation of Princeton.

Where a power is given to trustees to do or not to do a particular thing at their discretion, the court has no jurisdiction to lay a command or prohibition upon them as to the exercise of that power, provided their conduct be bona fide and their de; termination is not influenced by improper motives. 2 Lew. Trusts *613, and note o.

Where absolute discretion is given to trustees as to the exercise of a power, the court will not compel its exercise unless it is improperly or unreasonably exercised. Tempest v. Lord Camoys, 21 Ch. Div. 571. See, also, Marquis of Camden v. Murray, 16 Ch. Div. 161.

Where trustees had power to apply the income of a fund in their “uncontrolled and irresponsible discretion,” the court, while expressing an opinion that the trustees were not acting judiciously, declined to interfere with their discretion, there being no proof of mala fides. Tabor v. Brooks, 10 Ch. Div. 273. See, also, Gisborne v. Gisborne, 2 App. Cas. 300; Attorney-General v. Governors of Harrow School, 2 Ves. 551; Brophy v. Bellamy, L. R. 8 Ch. App. 798; Collins v. Vining, C. P. Coop. 472.

'Where in a trust deed for the satisfaction of debts a discretion is vested in the trustees to refuse the benefit of that deed to any creditor, although his claim might be lawful, the court could uot empower a -master to ascertain who were entitled to the benefit of the deed. Wain v. Earl of Egmont, 3 My. & K. 445.

In Cowley v. Hartstonge, 1 Dow. 361, Lord Chancellor Eldon remarked (at p. 378) that if a testator clearly manifested his intention on the face of the will that his trastees should have certain discretion,,the court would not control that discretion.

In Talbot v. Marshfield, 2 Dr. & Sm. 285, Vice-Chancellor Sir R. T. Kindersley said that the intention of the testator clearly was that if a certain exigency arose the trustees should, if they thought fit, in the exercise of their discretion, notwithstanding the gift in remainder, hand over the corpus of the fund to the persons entitled for life; and the court would not interfere with the honest exercise of such discretion.

Where a testator directed two trustees to apply certain rents, or such parts as they or he should in their or his discretion see fit, in the maintenance and education or advancement in life of his younger children, during the life of his wife, and one of the trustees having died, the court would not interfere with the discretion to be exercised by the surviving trustee. Livesey v. Harding, 1 Tam. 460.

In Gisborne v. Gisborne, 2 App. Cas. 300, Lord Cairns, speaking for the house of lords, said (at p. 305) : “The trustees are not merely to have discretion, but they are to have ‘’uncontrollable/ that is, uncontrolled, authority. Their discretion and authority,,always supposing that there is no mala fides with regard to its exercise, is to be without any check or control from any superior tribunal.”

In re Lofthouse, an infant, 29 Ch. Div. 921, Vice-Chancellor Bacon, referring to Gisborne v. Gisborne, ubi supra, remarked (at p. 926): “There the trustees had reposed in them an 'uncontrollable authority/ and their lordships refused to interfere with that authority.”

In Marquis of Camden v. Murray, 16 Ch. Div. 161, Vice-Chancellor Malins (at p. 170), speaking of the court’s exercise of control over trustees, remarked: “In certain cases—not in all cases because if their discretion is absolutely uncontrollable, I should not interfere—that I have recently decided, after full investigation, in the case of Tabor v. Brooks, 10 Ch. Div. 273, where there was an absolute discretion in trustees; although they exercised their discretion in a manner most unsatisfactory and in a way I entirely disapproved of, yet I felt myself bound to come to the conclusion, on the authorities and principles of the court, that I could not control them where there was no mala fides, and where they were honestly exercising their power.”

In this state the court of errors and appeals in Read v. Patterson, 44 N. J. Eq. (17 Stew.) 211, held: “Where a power is coupled with a trust or duty, a court of equity will enforce a proper and timely exercise of the power; but if it be given upon a trust to be exercised in the discretion or upon the judgment of the trustee, the court will not interfere with the trustee’s discretion in executing the trust unless he has exercised his discretion mala fide.” And cited with approval many English cases, among them Livesey v. Harding, Brophy v. Bellamy, Tempest v. Lord Camoys, In re Lofthouse, ubi supra.

This case is an appeal from the conscience of the trustees to the conscience of the court, and, assuming that the court, upon the facts, would be of the opinion that the complainants are entitled to the relief they pray, namely, that the defendants be enjoined and restrained from selling and conveying away any part or parcel of the Cedar Grove church property, and further, that they are entitled to have the trust property applied cy pres, -still, the court would be powerless to grant such relief unless the defendants had acted mala fides. There is no proof of bad faith in this case. On the contrary, the trustees, all honorable and intelligent men, appear to have acted in a way entirely warranted by the facts, and while not obliged under the terms of the trust to give reasons for their action in that regard, they have given some of them, which may be succinctly stated as follows: That certain of the pastors who supply the pulpit at Cedar Grove have recommended the discontinuance of the religious services carried on under the plan by reason of existing conditions; that the community in the vicinity of the church has changed since its establishment and that none of the people for whom the trust was originally created are now living at Cedar Grove; that almost without exception the religious people there are connected with other churches; that the services of recent years have been poorly attended; that the abandonment and sale of the church will not deprive the people of Cedar Grove of gospel privileges. They say that'it seems to them to be their plain and clear duty to discontinue the services under the terms of the trust and plan of the donor. And in this I am inclined to agree with them, especially in view of the great falling off in the attendance upon the services, amounting, at'times, at least, almost to an abandonment of the church as a place of religious worship. However, this question is not decided, as I before remarked, and the reason is that its decision was by the donor confided to the trustees who have made a bona fide exercise of their power in that regard. This being so, the court may not review their judgment in the premises.

The result is that as the case stands the prayer of the complainants must be denied. The amendment above mentioned will be directed to be made, and the attorney-general must be made a party defendant. After he appears and answers ultimate disposition will be made of the case as above indicated.

As this proceeding is in good faith and requires a construction of the trust instrument under which the property is held, it would appear to be a case for the allowance of costs and counsel fees to both parties under the authority of Attorney-General v. Moore’s Executors, 19 N. J. Eq. (4 C. E. Gr.) 503, 519. I will hear counsel further on this question at any time before final decree.

Memorandum on application to settle decree.

Walker, Y. C.

This was a case concerning a trust arising under a deed. The opinion concluded thus, supra:

“As this proceeding is in good faith and requires a construction of the trust instrument under which the property is held, it would appear to be a case for the allowance of costs and counsel fees to both parties under the authority of Attorney-General v. Moore’s Executors, 19 N. J. Eq. (4 C. E. Gr.) 503, 519. I will hear counsel further on this question at any time before final decree.”

This question of the allowance of costs and counsel fees was not raised or argued, and now counsel for the defendant objects to'their allowance on the ground that they are properly payable out of the estate only in case of contests under wills,' but are not allowed in the case of contests under deeds.

The authority upon which I predicated the allowance is that of Attorney-General v. Moore’s Executors, supra, in which case the court of errors and appeals (at p. 519) said:

“If reasonable grounds exist for coming into the court to obtain the construction of the instrument creating the trust, the practice is to allow the costs and expenses, as it respects all the parties, and as between attorney and client, out of the trust funds.”

Although the court in Attorney-General v. Moore’s Executors was dealing with a trust created by will, nevertheless, the award of costs and counsel fees to all parties was said to be the practice in cases where “reasonable grounds exist for coming into the court to obtain the construction of the instrument creating the trust.” Now, if the court meant that that practice obtained only with reference to contests arising under wills I believe it would have so stated. But, the observation that the rule obtains in cases where the “instrument creating the trust” has to be construed, strikes me as a deliberate decision to the effect that the rule is not confined to will cases, as a will is only one instrument under which a trust may be created, and a deed is certainly another one. I am not prepared to believe that the court of errors and appeals meant to confine allowances in cases of the kind under consideration. to trusts arising under wills, because if it did how easy it would have been to use the proper and apt expression “will” creating the trust instead of “instrument,” a term which comprehends “deed” as well as “will.”

In Bouv. Dict. (Rawle’s revision) 1064, “Instrument” is thus defined :

“A document or writing which gives formal expression to a legal act or agreement. * * *
“It includes bills, bonds, conveyances, leases, mortgages, promissory notes, and wills.”

I have not overlooked the fact that the court of errors and appeals in Attorney-General v. Moore’s Executors cited as authority for allowances to both sides 1 Redf. Wills 493, and 3 Dan. Ch. Pr. 1554. (the paragraph number must be a mistake, and paragraph 1437, which concerns costs in will cases, must be intended). Nor have I overlooked the fact that the decision, so far as it extends to instruments other than wills, is probably dictum, as it was a will' ease which was under consideration. My interpretation of the court’s decision, and, consequently my opinion, is, that the word used, namely instrument, was used in its usual and ordinary sense.

There is, in my judgment, a peculiar equity in this case en titling the complainants to costs out of the trust property. This was not a suit brought immediately upon a trust being created to resolve doubts and ambiguities upon the face of the trust instrument in order that the trust might be settled and applied, but was a case in which the trust had been executed for a period of more than thirty years, and then the trustees, under power conferred upon them, determined that conditions subsequent had happened which rendered the trust property no longer available, or at least no longer required, for the purposes of the original trust, and thereupon determined to sell such of the trust property as consisted of land and hold the proceeds, together with certain moneys donated, upon a certain other trust, of which the complainants were not the beneficiaries. To say that in such a case the original cestuis que trust must defend at the peril of costs, although they have reasonable ground for defending, seems to me to be untenable. At least I think that costs in such a case may, in the discretion of the court, be awarded out of the fund. I adhere to my original view and will allow costs to the complainants and a counsel fee of $350, payable out of the trust estate. Defendants’ counsel does not ask for an allowance in the decree.