author: Talcott, J.: Allen, J.,

text:
    FLORENCE M. GIBBS, Respondent, v. THE CONTINENTAL INSURANCE COMPANY, Appellant.

      Policy of insurance — agreement to refer question of amount of loss to arbitration— when not enforceable — waiver of— When house unoccupied — Valse valuation— must be fraudulent to a/void policy.

    The defendant issued to the plaintiff a policy of insurance upon certain personal property, by which it agreed to make good unto the assured all such -immediate loss or damage as should happen by fire to the property specified, the amount of loss to be estimated according to the actual cash value of the property at the time of the loss.
    In the ninth condition of the policy it was provided that in'case differences should arise touching any loss or damage, after proof had been received in due form, the matter should, at the written request of either party, be submitted to impartial arbitrators, whose award in writing should be binding on the parties as to the amount of such loss or damage, but should not decide the liability of the company under the policy.
    In the tenth condition of the policy it was provided that no suit or action against the company, for the recovery of any claim by virtue of the policy, should be sustainable in any court of law or chancery, until after an award shall ha/ve been obtained, fixing the amount of such claim in the manner above pi'ovided.

    In this action, brought to recover the amount due thereunder, upon the destruction of the property, the defendant claimed that a difference had arisen as to the value of the property destroyed, and that as no award had been made by arbitrators, no recovery could be had under the policy. Neither party had . requested, either in writing or otherwise, that the matter should be submitted to arbitrators.

      Seld, that by the terms of the ninth condition, no obligation to submit the amount of the loss to arbitrators arose, until a written request so to do had been made by one of the parties.

      Semble, that the condition as to submitting the amount of the loss or damage to arbitrators was only collateral, to the main agreement of the defendant, which was to pay the amount of the loss, “to be estimated according to the actual cash value of the property at the time of the loss,” and that such collateral agreement did not deprive the plaintiff of the right to maintain an action on the policy until such reference and an award, in pursuance thereof, had been had.

      Smile, that as the defendant, by its answer, denied its liability for any part of the loss, on grounds specifically stated therein, it thereby waived the condition requiring an arbitration, as the amount of the loss was immaterial, if the company insisted that it was not liable for any portion thereof.
    The policy further provided that, “ if the premises should become unoccupied without the consent of the company indorsed thereon, then and in every such case the policy should be void.” The plaintiff had for some time before the fire, slept in the adjoining house, which belonged to her daughter, but had never abandoned the x>remises; her furniture and wearing apparel remaining there, and she returning and spending the day there.

      Held, that the house was not unoccupied within the meaning of the condition.
    Another condition of the policy provided that all fraud or attempt at fraud, by false swearing or otherwise, should cause a forfeiture of all claim on the company.

      Held, that it was not enough to constitute a breach of this condition; that the insured in making out proof of loss, had overvalued an article destroyed by the fire, even though it appeared that she knew or ought to have known that the valuation was excessive, unless such overvaluation was made with a fraudulent intent.
    Arpe at, from a judgment in favor of the plaintiff, entered upon a verdict of a jury, and from an order denying a motion for a new-trial, made upon a case and exceptions.

      F. O. James, for the appellant.

      J. A. Hathaway, for the respondent.
    The house was not occupied within the meaning of the conditions of the policy. (Qamwell v. M. TJ. Ins. Go., 12 Cush., 167; O'*Neil v. The Buffalo F. Ins. Go., 3 Com:, 122; Wastbwrn v. Gity F. Ins. Go., 15 •Wis., 138; Cummings v. Agri. Ins. Go., 5 Hun, 551; Paine v. Agri. Ins. Go., 5 S. C., 619; Hamm v. Home Ins. Go., 59 N. Y., 387; Gates v. Madison Ins. Go., 1 Seld., 169; Sherman v. Niagara Ins. Go., 16 N. Y., 532; Kelly v. Home Ins. Go., 2 Weekly Digest, 179.)
   Talcott, J.:

This is an appeal from a judgment in favor of the plaintiff, entered on a verdict at the Oswego Circuit, and from an order refusing a new trial.

The plaintiff owned a two-story frame dwelling-house, situated on Oneida street, in Oswego. On the Yth day of March, 18Y3, the defendant, through E. J. Harmon, its agent at Oswego, issued its policy insuring the plaintiff against loss or damage by fire in the sum of $2,000 on the house and $1,200 on the furniture, wearing apparel, etc., therein, for one year. On the Yth day of March, 18Y4, the policy was renewed for one year. On the night of the 22d day of October, 18Y4, the said property so insured was damaged by fire. On the 4th day of November, 18Y4, the plaintiff made proof of loss in due form, stating the damages by the fire to the house to be $4,000 and to the personalty at $3,326.86. The articles of personalty exceeded 1,000 in number. By the ninth condition of said policy it is provided as follows: “ In case differences shall arise touching any loss or damage, after proof has been received in due form, the matter shall, at the written request of either party, be submitted to impartial arbitrators, whose award in writing shall be binding on the parties as to the amount of such loss or damage, but shall not decide the liability of the company under this policy, and it shall be optional with the company to repair, rebuild or replace the property lost or damaged with other of like kind or quality within a reasonable time, giving notice of their intention so to do within sixty days after receipt of proofs herein required.”

The tenth condition of said policy was as follows: “ It is furthermore provided and mutually agreed that no suit or action against this company for the recovery of any claim by virtue of this policy shall be sustainable in any court of law or chancery until after an award shall have been obtained fixing the amount of such claim in the manner above provided, nor unless such suit or action shall be commenced within twelve months next ensuing after the loss shall occur; and should any suit or action be commenced against the company after the expiration of the aforesaid twelve months, the lapse of time shall be taken and deemed as conclusive evidence against the validity of such claim, any statute of limitation to the contrary notwithstanding.”

The bill of exceptions states that it was proved that shortly after the proofs of loss were received, the agent and adjuster of the defendant called upon the plaintiff with the proofs of loss, and that differences then and there arose between the plaintiff and the defendant, touching the loss or damage sustained by the plaintiff, and that they disagreed in every thing as to values, and disagreed as to the amount of loss. The bill of exceptions contains the statement that “no proof was offered by either party to show that after these differences arose, any thing was done or any request was made by either party to submit the question of the amount of such loss to arbitration, or to show any thing which prevented the submission of such question to arbitration before action brought, or to show any waiver of the requirements of the policy in respect to such arbitration.”

The defendant moved for a nonsuit upon the ground that this action cannot be maintained until after an award of arbitrators, fixing the amount of the loss. The question was reserved by the court, with other questions in the case, and was finally decided against the motion for a nonsuit, and judgment was ordered for the plaintiff in the action, after argument at Special Term.

While prospective contracts to arbitrate all matters of difference which may arise between the parties have been held void as tending to oust the courts of jurisdiction, and hence contrary to public policy (Hurst v. Litchfield, 39 N. Y., 377), yet it may be considered as the settled law of this State that contracts to arbitrate a particular subject-matter, such as the amoimt of a loss or the value of property, etc., are not only valid and binding on the parties, but may be made by agreement a condition precedent to the right to maintain an action involving such amount or value.

In this case, however, the agreement to refer to arbitration was a collateral contract to the main contract, by which the insurance company agreed in the policy to “ make good unto the assured, her executors, etc., all such immediate loss or damages * * * as shall happen by fire to the property so specified. * * * The amount of loss or damage to be estimated according to the actual cash value of the property at the time of the loss, and to be paid in sixty days after proof of the same, required by the company, shall have been made by the assured and received at this office, and proved in accordance with the terms and provisions of this policy.”

In the case of Scott v. Avery (5 House of Lords Cases, 811), principally relied upon by the defendant’s counsel, there did not appear to be any independent agreement to pay the amount of tbe loss within a specified time. The question there presented is briefly stated by Crowder, J., one of the judges who, in the House of Lords, delivered an opinion in favor of sustaining the judgment of the Exchequer Chamber, thus : The question, then, seems to resolve itself into this, whether such a contract can legally be made so as to bind the contracting parties ? Can a shipowner and insurer enter into a valid agreement, that the shipowner shall pay down a given sum, and that in consideration of such payment the insurer, upon the loss of a given ship, shall pay to the said owner not the amount of the loss sustained by him through the perils of the sea, but only such a sum of money as shall be settled and ascertained by arbitration ? I am not aware of any legal objection to such a contract, whatever may be thought of its prudence, and I think the effect of such a contract is that no action lies for the breach of it until the sum has been ascertained by arbitration.”

Hr. Justice Creswell, in the same case, says (see page 838): “ for if there is an ordinary contract of insurance, that would give a right of action immediately on the happening of the loss, and a rule (condition) requiring the assured to wait for an adjustment of the loss by the committee would be repugnant to the contract.”

In Roper v. Lendon (1 Ellis & Ellis, 825), Lord Campbel, who had delivered one of the leading judicial opinions in Scott v. Avery, in the House of Lords, held that a plea setting up a condition substantially like the one in this case, and that the company had never declined, but had always been ready to refer such dispute to the judgment and determination of two indifferent persons as arbitrators in the manner provided for by such condition, of which the plaintiff had notice before suit, and that the said dispute or difference, “ and the amount of the plaintiff’s supposed loss or damage, had never been determined, as by the same condition is provided ” was bad, saying: “ The agreement to refer, contained in the fifteenth condition, is merely collateral to the agreement to pay. The courts will not, therefore, treat the agreement to refer as ousting their jurisdiction until there has been a reference.”

And Hill, J., in the same case, said: “The case is clearly, not within the case of Scott v. Avery. Here the agreement to refer is collateral to the agreement by the company to pay; there the agreement was to pay only such sum as the arbitrators should award.”

The case of The President of the Delaware and Hudson Canal Company v. The Pennsylvania Coal Company (50 N. Y., 250) was also much relied upon by the counsel for the defendants to show that the reference to arbitrators in this case was a condition precedent to the right of the plaintiff to maintain any action upon the policy. In that case it appeared that the Delaware and Hudson Canal Company, proposing to enlarge their canal, entered into a contract with the defendants whereby it was in substance agreed that the canal company might charge an increased toll on the coal which should be transported through the canal by the defendant, the amount of such increased charge to be based upon the estimated costs of transportation per ton on said canal after the enlargement should have been made, which increased charge was to be one-half of the estimated reduction in the cost of transporting the coal, effected by such proposed enlargement; and if the parties should not agree on the just and proper amount of reduction produced by the proposed enlargement, then the contract provided that the question should be submitted to two person, one to be chosen by each party, and if these two were unable to agree, they were to choose a third person, and the report of a majority of the three to be final on the subject of the amount the defendant was to pay by way of additional toll.”

Allen, J.,

delivering the majority opinion, says: The plaintiffs, under the agreement, secured to themselves the right to certain tolls, absolutely, for the use of their canal, to be ascertained from year to year in the manner and by the rules prescribed. * * * the defendant undertook to pay in addition to the toll before then chargeable at a rate to be established after the canal enlargement should be completed in the manner particularly prescribed, and arbitration was the final resort agreed upon to establish the rate and amount of toll in case the contracing parties should not be able to agree, and the decision of the arbitrators was to be final in the premises. * * * The manner by which the rate of toll was to be established was by the agreement of the parties or, that failing, by arbitration. * * * The right of the plaintiffs is only to an additional rate of toll “ to'be established” and the ageement prescribes the rule and designates the means and agency by which the additional toll is to be computed, estimated and thus established. The right, of the plaintiff to demand, and the obligation of the defendants to pay, additional toll is restricted to the rate to be established pursuant to the agreement. * * * The clear and plain intent of the parties was that the additional rate of toll should “ be established” as preliminary to the right of the plaintiffs to charge and collect. * * * Neither party contemplated the possibility of, or would have agreed to, a rate of toll to be determined by a jury in an action which the plaintiffs might bring for the recovery of the toll upon the first cargo of coal that might pass through the canal after the enlargement,” and he adds, “ Scott v. Avery (supra) is, in principle, on all fours with the case at bar, and unless we are prepared to overrule or disregard it, is decisive.”

The contract to refer in the case in 50 New York, it will be seen, was not deemed a collateral contract, but the only mode by which the amount to be paid could be determined. There was no agreement to pay any amount in that case, except as should “ be established ” in the manner prescribed by the agreement. In the opinion in the case in 50 New York, Allen, J., recites the case of Roper v. Lendon (1 Ellis & E. [L. B.] 825) as belonging to a class of cases “which involved the validity of covenants which deprived the parties of the protection of the comts, and ousted the court of all jurisdiction.” Whereas we have seen that the ease of Roper v. Lendon was placed upon the ground that the agreement to refer to arbitration was collateral to the main contract.

Adams v. Willoughby (6 Johns., 65, 67), so far as it is an authority on this subject, seems to stand on the same ground as to the “unliquidated demands ” mentioned in that case. There was no obligation on the part of the defendant to pay cmy sum, except such sum as the arbitrators should determine was due to the plaintiff from Josiah Fuller. As there was no reference to arbitration to determine the amount of the unliquidated sums, there was no mode by which the amount to be paid by Willoughby could be ascertained.

In Stephenson v. Piscataqua Fire Insurance Company (54 Maine, 55) it was held, after considering the case of Scott v. Avery (supra), that a condition, in a policy similar to that in question, was void, because it deprived tbe parties of tbe protection of tbe law, and tended to oust the courts of jurisdiction.

Tbe insurers in tbis case bave apparently sought to avoid tbe effect of tbat and similar decisions by ingeniously adding to the condition tbat tbe award of tbe arbitrators should be binding as to the amount of tbe loss, “but shall not decide tbe liability of tbis company under tbis policy,” and possibly they bave escaped tbe general condemnation of such conditions, as being contrary to public policy, by tbis provision. However tbat may be, we think tbe condition is collateral to tbe main contract, which is “ to make good unto tbe said assured * * * all such immediate loss and damage, * * * as shall happen by fire to tbe property so specified * * * not exceeding in amount tbe sum or sums insured as above specified * * * tbe amount of loss or damage to be estimated according to tbe actual cash value of tbe property at tbe time of tbe loss.” And although if a reference to arbitration bad taken place under tbe condition, perhaps tbe award would bave been conclusive as to what tbat cash value was; yet, as no such reference bad taken place, we do not think tbe plaintiff was, by tbe collateral agreement to refer, deprived of tbe right to maintain an action on tbe policy until such reference and an award in pursuance thereof bad been bad.

But aside from tbe question whether tbe contract to refer to arbitration was collateral to tbe obligation to pay, and tbe obligation not dependent upon tbe result of tbe agreement to refer, we think, by tbe terms of tbis contract, tbe contingency, upon tbe happening of which tbe obligation to refer to arbitration would arise, does not appear to bave happened. The duty to submit to arbitration was, by tbe ninth condition, made to depend upon tbe “ written request of either party,” and tbe tenth condition restraining any suit or action for tbe recovery of any claim by virtue of tbe policy, does not operate unless an arbitration shall be requested in “ writing in tbe manner above provided.”

We think, therefore, tbat even if tbe submission to arbitration might be a condition precedent to tbe right to maintain an action on tbe policy, provided a written request for such an arbitration bad been made by either party; yet tbat such “ written request,” by one or tbe other of tbe parties, was of itself, a condition precedent to tbe right to require an arbitration, and that no obligation to submit to arbitration arose until such written request was made by one or the other of the parties. It seems that no evidence was offered by either party to show that there was any such request within the sixty days, at the expiration of which time the loss was payable, and the plaintiff, as we think, had, at the expiration of that time, a right to assume, in the absence of a written request, that the defendant did not desire to have the question of the amount of the loss submitted to arbitration, but chose to rely on one or more of the numerous defenses set up in the answer.

To give these conditions such a construction as is insisted upon by the counsel for the defendant, would be to ignore the prerequisite of a written request, and to, in effect, hold that those words in a condition, either have no meaning at all, or else to debar an action on the policy for an indefinite time, although neither party desires an arbitration. • The insurance company knew that a ease had arisen in which arbitration might be required, if requested, to wit: “ differences touching loss or damage.” It refrained from requesting any submission of these differences to the arbitration provided for by the conditions of the policy, and the attempt now to set up that no action can be maintained on the policy, until such an arbitration has been had, operates as a surprise upon the plaintiff who, as we think, was justified in supposing that the defendant, having made no request for an arbitration, did not desire any. The language of the condition was calculated to lead the assured to suppose that, in the absence of any request for an arbitration on the part of the company, no arbitration was necessary as a condition precedent to the right to sue for the amount of the loss and damage, “ to be estimated according to the actual cash value of the property at the time of the loss.” And we think that the omission of the company to signify its desire for an arbitration within the sixty days, was11 a waiver of the ninth and tenth conditions, on its part.

The answer of the company denies its liability for any part of the loss, upon various grounds, specifically alleged in the answer. It has been held, in various cases, that the condition to arbitrate concerning a loss where differences arise as to the amount, is waived where the insurance company denies its liability for any loss, whatever the amount may be. Because the amov/nt of the loss is imma terial, if the company insists it is not liable for any loss, and is calculated to mislead the insured as to the true grounds of the objection of the company to the payment of the loss. (See Robinson v. Georges Ins. Co., 17 Maine, 131; Mentz v. Armenia Fire Ins. Co., 79 Penn. St., 478.) But without resting our decision upon this ground, we are of the opinion that the plaintiff had a right to waive a submission to arbitration, which she has done by omitting to request one, and that the defendant has also waived the condition, by refraining from making known its desire for an arbitration, in the manner provided for in-the condition.

The second exception presented by the defendant for our consideration is founded upon a further condition in the policy, as follows: “If the premises become unoccupied without the consent of this company indorsed hereon, * * * then and in every such case this policy shall be void.” The evidence in the case showed that the plaintiff had slept at night for some time, but for how long it did not clearly appear, at her daughter’s house, who lived in the adjoining house to the one which was occupied by the plaintiff, but she had never abandoned the premises, and although lodging in her daughter’s house, her furniture and wearing apparel was left at her own. She returned daily to the premises insured, and, as we understand the testimony, spent the day there. This was not such an abandonment of the insured premises or ceasing to occupy as is within the meaning of the condition referred to. (Shearman v. Niagara Ins. Co., 46 N. Y., 532; O'Niel v. The Buffalo Fire Ins. Co., 3 Comst., 122; Cummins v. The Ag. Ins. Co., 67 N. Y., 260; Gumwell v. M. and F. Ins. Co., 12 Cushing, 167.)

Though the answer of the court to the request of the plaintiff’s counsel may be understood as taking the question, whether the house had become unoccupied, -within the meaning of the condition, from the jury, we think the charge that the house was not proved to have become unoccupied within the meaning of the condition, taken in connection with the explanation contained in the former part of the charge, as to what was ceasing to occupy within the meaning of the condition in question, was correct.

The third exception, taken by the counsel for the defendant, was founded upon the fact that in the proofs of loss furnished by the plaintiff to the company, she had stated the value of a piano at $400, whereas, it was shown by a witness, from whom she purchased the piano about fourteen years before the trial, that she bought it for $300, and that in the opinion of the witness, if well used, it would probably be worth at the time of the fire, no more than from $125 to $150. The plaintiff had stated, on her examination as a witness, that she put down the values at what she remembered the articles cost, as near as she could; that she could not' remember what the piano cost, but that a music dealer had offered her $400 for it in exchange foi’ another piano. It was proved by another witness, an expert, that he knew the piano in question, that it had been used very little, and that, in his judgment, the piano at the time of the fire was worth $300.

At the close of the charge to the jury, the defendant’s counsel asked the court to charge “ that if the jury find that the plaintiff, in her proofs of loss, knowingly put false valuations upon her property destroyed, that her policy is forfeited and she cannot recover.” The court refused so to charge unless the word “fraucht,lenity ” should be inserted in the request. The import of the ruling of the judge was that the overvaluation placed upon her property by the plaintiff in her proofs of loss, even if she had reason to know or ought to have known that such valuation was above the market value, did not occasion the forfeiture of the policy unless done with intent to defraud the defendant. The condition of the policy which bears upon this subject is as follows, a part of the ninth condition: “All fraud or attempt at fraud by false swearing or otherwise shall cause a forfeiture of all claim on this company under this policy; ” and we think the justice at the Circuit was correct in holding that a fraudulent intent was a necessary ingredient in the false valuation, even though there might be evidence from which the jury might have come to the conclusion that the plaintiff knew or had the means of knowing, or ought to have known, that the valuation in the proofs of loss was overstated. (Ins. Co. v. Weides, 14 Wall. [U. S.], 375; Unger v. The Peoples Fire Ins. Co., 4 Daly, 96; Wolf v. Goodhue Ins. Co., 43 Barb., 400; Sturm v. Gt. Western Ins. Co., 40 How. Pr., 423; Owens v. The Holland Punchase Co., 1 Sup. Ct. [T. & C.], 285; Hickman v. The Long Island Ins. Co., 1 Edw., 374.) Overvaluatiom may afford evidence of a fraudulent intent, but is not of itself conclusive evidence of such an intent.

Most persons would be apt to set a value upon articles which they have had long in their possession, as personal belongings, especially articles of furniture, far in excess of what they would be appraised by an auctioneer or dealer in second-hand furniture. They may be, and usually are to the owner, of more value than could be obtained in the market, and the requisition by the judge at Circuit, that the overvaluation must have been not only knowingly but with a fraudulent intent, was within the very terms of the condition of the policy, which, it was claimed, had been violated by the statement of the value in the preliminary proofs of loss.

The remaining exceptions to which our attention is called relate to the admission of evidence which was objected to, and we think that so far as the rulings are liable to criticism, they were upon immaterial matters, which could not have influenced the result, and on the whole bill of exceptions we think the judgment sliould be affirmed.

Present — Mullin, P. J., Talcott and Smith, JJ.

Judgment and order of the Special Teftm affirmed.


source: Caselaw Access Project

author: Talcott, J.:

license: Public Domain

text:
    ALONZO C. YATES and THEODORE DISSEL, Respondents, v. CORYDON BURCH and JAMES McQUEEN, Appellants.

      Appeal by exeeutor — secv/i'ity on — failure to apply for limitation of, amount of, under Code, § 389 — presumption of assets, an’ising from — Meaning of “adverse party.”

    Although section 339 of the old Code authorized the court to dispense with or limit the security, required by sections 335, 336, 337 and 338 to be given upon an appeal, when the appellant was an'executor, administrator or trustee acting in the right of another, yet when an executor without making any application to have the security limited or dispensed with gives the security in the ordinary form, the giving of such undertaking will be taken as an admission by him that he has sufficient assets applicable to the payment of the judgment appealed from, to satisfy the same.

      The term “adverse party,” asused in section 348 of the Code, requiring notice of the entry of judgment, affirming the judgment appealed from, to be served upon the “adverse party” at least ten days before commencing an action upon the undertaking, means the parties to the original judgment by whom the appeal was taken.
    Appeal from a judgment sustaining a demurrer to the second defense alleged in the answer of the defendants.

      Hunt <& Weaver, for the appellants.

      Rxhger <& Jenny, for the respondents.
   Talcott, J.:

Appeal from judgment rendered at Onondaga Special Term, sustaining the demurrer of the plaintiffs to the second answer of the defendants.

The action is brought by the plaintiff on an undertaking, given by the defendants in the original action, on an appeal to the General Term from a judgment rendered in the Supreme Court against Henry C. Hoffman and Israel McDonald, as executors of the will of Chester ~W. Ryant, deceased.

The second answer of the defendants, which is demurred to? alleges that the judgment was recovered on a liability incurred and contracted by the him of Chester "W. Ryant & Co., composed of Chester "W. Ryant, now deceased, and Seth D. Ryant, also now deceased. That said judgment could be enforced only against the individual property of the said Chester W. Ryant, in the hands of the executors remaining after paying the individual debts of the said Chester "W. Ryant, deceased, and that there is a deficiency of personal assets which have or should properly have come to the hands of said executors, and said executors having fully administered upon said assets, said deficiency still remains, and there is not sufficient assets in said executors’ hands to pay the individual debts of said Chester W. Ryant, deceased, and that said executors were not adjudged by the judgment in the complaint described, to be personally liable to said plaintiffs, nor required to pay said judgment, except by the proper administration and application of the assets in their hands as such executors, if any there were, applicable to the payment of the plaintiffs’ alleged claim, and that the defendants are not hable and cannot be held to a greater or different liability than the liability of said executors in said alleged judgment.

Section 889 of the Code of Procedure, in force when the undertaking which is sued on in this case was given, provides that when an appeal is perfected as provided by sections 335, 336,337 and 338, the court below may dispense with, or limit the security required by sections 335, 336 and 338, when the appellant is an executor, administrator or trustee, acting in another’s right. Thus, in effect, providing, that the court below may absolve the executor from all obligation to give security on the appeal where a proper case is made for such absolution. Section 339, by its terms, relates only to security to be given on appeals to the Court of Appeals. But section 348 provides that on an appeal to the General Term, such an appeal does, not stay the proceedings, unless security is given, as upon an appeal to the Court of Appeals. A statement of a want of assets sufficient to pay the judgment appealed from, would doubtless be regarded as a good reason why the security should be limited to the amount of assets disclosed applicable to the payment of the judgment, or for dispensing with secmity altogether when there is reasonable doubt of the affirmance of the judgment appealed from. In this case, it does not appear that the defendants in the original judgment ever made any application to the court below for leave to appeal without security, or in any manner to limit the security to be given, and under such circumstances the giving of security in the ordinary form must be taken as an admission of sufficient assets, applicable to the payment of the judgment appealed from, to satisfy the same. (Mills v. Forbes et al., 12 How. Prac. R., 466.)

The counsel for the defendant seeks to attack the sufficiency of the complaint, on the ground that it does not show a service of a notice upon the “ adverse ” party of the entry of a judgment affirming the judgment appealed from, ten days before the commencement of an action on the undertaking. That such a notice must be averred in a complaint in an action on an undertaking of appeal, is settled by the case of Porter v. Kingsbury (5 Hun, 597, affirmed by the Court of Appeals, 5 vol. Weekly Dig., 161).

The averment in the complaint in this case is, that notice of the judgment of affirmance was, more than twenty days prior to the commencement of tbe action, duly served by mail upon the attorney for the adverse parties and judgment-debtors therein described by the attorneys for the plaintiffs therein, to wit: upon M. Y. B. Bach-man, Esq., attorney for said Hoffman’s and McDonald’s executors, etc., as above set forth.”

The section, 348, of the Code of Procedure, provides that the notice must be served on “ the adverse party.” There was, then, no adverse party-except the defendants- in the original judgment, who were appellants, and we think this is the “ adverse party ” meant by section 348, and this construction is made more plain by section 1306 of the Code of Civil Procedure, by providing that such service shall be on the attorney for the appellant. The objection is taken that the averment does not state the facts as to how the service by mail was made, so as to show it to have been done in compliance with the rule on that subject. This is not an objection to the substance of the complaint, but only to the form which might have been the subject of a special demurrer, but cannot be objected to under the rule that judgment shall be against the party who has committed the first fault in pleading. (Doty v. Russell, 5 Wend., 129.)

The order sustaining the demurrer must be affirmed.

Present — Mullin, P. J., Talcott and Smith, JJ.

Order sustaining the demurrer of the plaintiff to the second defense alleged in the answer of the defendant, affirmed.


text:
    AMELIA PLOPPER, Respondent, v. THE NEW YORK CENTRAL AND HUDSON RIVER RAILROAD COMPANY, Appellant.

      Gontvibutoi'y negligence — when question should be submitted to the jury.

    At Kirkville, on the defendant’s road, the station and depot are on the north side of the track, and passengers generally get off on the north side of the cars. Along the south side of the track, and very close to it, is a ditch. The plaintiff, a resident of the place and well acquainted with the situation of the depot, attempted to get off the train, on the south side, at a point where the track was intersected by a highway running at right angles with it, at a time when the train had stopped or was running very slowly. The conductor, who was o i the north side of the train, not seeing the plaintiff, who was on the lowest step of the car, signalled the engineer to go on, and by his so doing the plaintiff was thrown off and injured. It was proved that when the cars stopped on the highway it was not unusual for parties to alight from the cars on the southerly side of the train, which was the side nearest to the village.

      Held, that it was error for the court to charge, as matter of law, that the attempt to alight on the southerly side of the train did not constitute contributory negligence; that whether it did or not should have been submitted to the jury.
    Appeal from an order denying a motion for a new trial made by tbe defendant, after a verdict for tbe plaintiff.

      O. W. Kennedy, for tbe appellant.

      W. C. Huger, for tbe respondent.
   Talcott, J.:

Tbis is an appeal from an order made at tbe Onondaga Circuit denying a motion for a new trial on tbe minutes, after a verdict at tbe same Circuit for tbe plaintiff.

Tbe action is to recover damages for an injury to tbe plaintiff, a passenger, caused by tbe alleged negligence of tbe defendant. Tbe injury occurred at Kirkville, a few miles east of Syracuse, to wbicb place tbe plaintiff was a passenger on one of, tbe defendant’s trains from Syracuse. A prominent question on tbe trial was whether tbe plaintiff was not guilty of contributory negligence wbicb conduced to tbe injury, by attempting to get off tbe cars on tbe south side of tbe train in place of getting off ron tbe north side, where tbe depot was located, and on wbicb side passengers generally alighted 'from tbe defendant’s trains, and on which north side several passengers alighted in safety on tbe occasion in question.

It appeared that tbe plaintiff resided at ICirkville, and was well acquainted with tbe station and its surroundings. There was on tbe south side of tbe railroad track, on wbicb tbe train from wbicb tbe plaintiff alighted stood, a ditch running parallel to, and along tbe south side of, tbe track, and as near to tbe track as it could with safety to tbe track be constructed. Tbe plaintiff was in tbe habit of frequently using tbe railroad in going to Syracuse and returning, and knew that the customary place to alight from the trains was on the north side of the track, where the depot was located, and on which side the conductor of the train was placed to assist passengers in alighting from the trains. The train in question stopped but a short time, a minute or less, at this depot, and it was a question in controversy on the trial whether the train stopped at all or only slowed up, and whether it was not actually in motion when the plaintiff undertook to get off. The plaintiff had never attempted to alight from the train on the south side except on this occasion. On this occasion she came out of the car, as it was slowing down, on to the rear platform, and casting a bundle which she was carrying down into the highway which crosses the railroad at right angles 'at that point, proceeded down the steps of the car.

When she arrived at the bottom step, with her right foot upon the ground and the other upon the step, and with her left hand holding the rail, the conductor, being upon the north side of the train and not perceiving that any person, was in the act of alighting on the south side of the train, had given a signal to the engineer indicating that the train was to proceed, and when the plaintiff was in this position, one foot upon the ground and the other upon the car step,, the train had acquired such speed that it was impossible for the plaintiff to recover herself, and she was dragged along in that manner for a few feet until her hold upon the rail was broken and she was thrown into the ditch, and it is alleged received the injuries for which she claimed to recover.

The judge at the Circuit instructed the jury that as matter of law the attempt on the part of the plaintiff to leave the cars on the south side was not evidence of such contributory negligence as would prevent the plaintiff’s recovery; in this, we think, he erred. As we understand the rule to be settled by the Court of Appeals: “ Where a railroad company has provided a depot and conveniences for getting on and off its trains, passengers have no right to get on or off at other places, and to attempt to do so would be such negligence as would preclude them from recovering for an injury received thereby.” This was laid down as the law governing such cases in the case of Keating v. The N. Y. Central R. R. Co. (49 N. Y., 673), affirming the judgment of this department in the same case (reported in 3 Lansing, 469).

In that case, although it appeared that there was a depot provided for the accommodation of passengers, where provision had been made for their entrance into the cars, and where the conductor was accustomed to give the signal for the starting of the train, which was the only place at which such provision had been made, yet the plaintiff attempted to enter the cars while they were standing across a street in which she was passing in attempting to reach the depot, and which so interrupted the |>assage of the street that she could not pass without crossing the platform of the cars.

There was evidence also given in that case that it was customary for persons to take the cars of the defendant while standing across the street in question at the place where the plaintiff attempted to take the cars. In that case this court held that the question of contributory negligence on the part of the plaintiff was a proper question to submit to the jury, and the Court of Appeals affirmed the decision in 49 N. Y., 673 (supra).

In the case at bar there was evidence to the effect that when the cars stopped in the highway, which was planked over, it was not unusual for parties to alight from the cars on the southerly side of the train, which was the side nearest to the village of Kirkville, and it was probably while the car in which the plaintiff was a passenger was standing, or as she supposed about to stop over the highway, that she commenced the attempt to alight, and it is quite possible she would have had time to have descended from the cars in safety had not they been suddenly started up. This, however, is inference to be' drawn by the jury in view of all the circumstances and not by the court, and the error at the Circuit was in not submitting this to the jury as a question of fact, but holding as a matter of law that the attempt on the part of the plaintiff to alight on the south side of the train did not furnish any evidence of contributory negligence.

Order reversed and new trial granted, costs to abide the event.

Present — Mullin, P. J., Talcott and Smith, JJ.

Ordered accordingly.


text:
    THEODORE P. BALLOU, Appellant, v. MAURICE E. JONES and EMMA A. JONES, Respondents.

      Fraudulent conveyance — what mast be done by creditor before he can attach it— Non-resident debtor.

    Where an action is brought against a debtor of the plaintiff and one to whom such debtor has fraudulently conveyed certain real estate, while so indebted, to set aside such conveyance and to satisfy plaintiff’s claim from the proceeds arising upon the sale thereof, it must be alleged in the complaint and proved upon the trial, that plaintiff has recovered a judgment against the debtor and has exhausted all available legal remedies against him.
    It is not sufficient to show that the debtor is a non-resident of this State and has no property herein, so long as it appears that he is living in another State, and may be proceeded against by the ordinary forms of law existing therein.
    Appeal from a judgment iu favor of the defendant Emma A. Jones, entered upon an order sustaining a demurrer to the complaint.

      Rioha/rdson <& Adams, for the appellant.

      8. E. Day, for the respondents.
   Talcott, J.:

This is an appeal from an order made at the Cayuga Special Term ordering a judgment in favor of the defendant, Emma Jones, on her demurrer to the complaint.

The complaint alleges, in substance, an indebtedness of Maurice E. Jones to the plaintiff, upon a covenant made by said Maurice to the plaintiff in 1874. That Maurice E. Jones owned 234 acres of land in Herkimer county worth about $1,500, and in July, 1876, exchanged the said 234 acres with one Parker for a house and lot in Cayuga county worth about the same amount. That it was agreed between said Maurice E. Jones and Parker that in consideration of the conveyance of the 234 acres, said Parker and wife should convey the house and lot in Cayuga county to Emma Jones, the sister of said Maurice E., and it was so conveyed. That said Emma did not pay or secure any part of the consideration but the same was wholly paid by said Maurice. That the conveyance to Emma was fraudulent as against the plaintiff and that a trust was thereby created and resulted in favor of the plaintiff as such creditor, to the extent necessary to satisfy his just demands. That the defendants are not residents of this State, but that Maurice resides in Pittsfield, in Massachusetts, or in Nebraska, and the defendant Emma resides in Pittsfield in Massachusetts. That neither of them has or owns any other property in this State, and that no process of any court in this State can be personally served upon either of them. That Maurice E. Jones has no property in this State out of which a judgment can be collected, wherefore the plaintiff has no available remedy for the relief sought in this action.

The complaint then demands the relief that he recover judgment against the said Maurice E. Jones for the amount due on the said covenant with costs of the action.

Secondly. That the house and lot in Cayuga county be sold under the direction of the court and the proceeds, so far-as may be necessary, be applied to the payment of the amount due the plaintiff. The defendant Emma A. Jones demurred to the complaint assigning as causes of demurrer :

First. That several causes of action were improperly united.

Second. That the complaint does not state facts sufficient to constitute a cause of action against her.

In the case of Estes v. Wilcox (61 N. Y., 264), the Court of Appeals reversed the judgment of this department, sustaining a demurrer to a complaint alleging that one Joshua Whipple, in his lifetime, caused certain real estate, which had been purchased and paid for by him, to be conveyed to Euth D. Wilcox, for the purpose of hindering, delaying and defrauding the creditors of the said Whipple ; that, at the time of the said conveyance, Whipple was indebted to the plaintiff, and that Whipple had died insolvent before the commencement of the suit, and asking that the said real estate be sold for the payment of the debt so due to the plaintiff. The defendant, Euth D. Wilcox, demurred to the complaint, on the ground that the complaint did not state facts sufficient to constitute a cause of action.

In the case at bar, the said Maurice E. Jones is living, and there is no averment of his insolvency. No judgment has been recovered against him for the plaintiff’s demand, but the plaintiff seeks to excuse the want of such judgment by the averment that Maurice E. Jones is a non-resident of this State, so that process cannot be personally served upon him, and that he has no property in this State subject to execution.

The Court of Appeals say, in Estes v. Wilcox (supra), that “ the reason of the rule that the creditor’s debt must be ascertained by judgment before proceeding in equity, does not fail by the death of the debtor before judgment recovered for the debt. The creditor may prosecute the claim to judgment against the personal representatives of the debtor ; and, although it would not be conclusive against his heirs or his grantees, by title acquired before his death, or in this case against the defendants, it would conclude the creditor as to the amount of his debt. In a suit against the personal representatives of the debtor to recover it, any defense which the debtor himself had could be interposed, and the claims would be subject to set-off or the plea of the statute of limitations, or to any defense existing when the action was brought. These questions would be settled, as between the creditor and the estate, by the judgment in the creditor’s action against the representatives. It is convenient and reasonable to require this to be done before subjecting third persons to litigation with the plaintiff, who may never be able to establish any claim against the estate.” (See, also, to the same effect, Allyn v. Thurston, 53 N. Y., 622.)

All available legal remedies must be first exhausted against the debtor before a creditor can come into equity to enforce the collection of his debt from the property of a third person. A judgment recovered against Maurice E. Jones in Massachusetts, the place of his residence, and an execution returned unsatisfied thereon, would be sufficient evidence of the exhaustion of legal remedies against the debtor. (McCartney v. Bostwick, 32 N. Y., 53.) Moreover,, such judgment would probably be conclusive against the defendant Emma, in the absence of fraud or collusion.

We think the fact that a-debtor is a non-resident, and has no property within the State, does not show that all legal remedies against him have been exhausted —r where he is living, and presumptively solvent, and may be proceeded against by the ordinary forms of law in a sister State, where he resides — and that the demurrer was properly sustained on the authority of Allyn v. Thurston and Estes v. Wilcox (supra).

Judgment should be affirmed.

Present — Mullin, P. J., Taloott and Smith, JJ.

Judgment affirmed, with costs.


author: Taloott, J.:

text:
    RICHARD FRALICK, Respondent, v. IRA BETTS, JAMES H. LOOMIS and JUDSON W. LOOMIS, Appellants.

      Admwaliy jv/risdiction — chap. 482 of 1862 — constitutionality of — Ganal boat— when a “vessel.”

    Admiralty jurisdiction does not extend to contracts relating to a vessel wholly engaged in the internal commerce of a State, and no maritime lien or claim can he founded on such contracts.
    Chapter 482 of 1862, providing for the collection of demands against ships and vessels is, so far as it relates to vessels wholly engaged in the internal commerce of this State, constitutional and valid.
    A canal hoat is a “ vessel ” within the meaning of the said law.
    The owner of a canal hoat made a contract with Pierce & Son, by which the latter were to make certain repairs in and upon the hoat. The repairs were made and the price to he paid therefor was paid by the owner to Pierce & Son. The plaintiff, who had been employed by Pierce & Son, to work upon the boat, not having been paid for the services rendered by him, sought to enforce his claim against the hoat under the said statute.

      Held, that he had no right so to do, as his employment by Pierce & Son gave him no right under the law of 1862 to claim a lien.
    Appeal from a judgment in favor of the plaintiff, entered upon • the report of a referee.

      W. A. Boueher, for the appellants.

      J?. David, for the respondent.
   Taloott, J.:

This is an appeal from a judgment rendered on the report of a referee.

The action is upon a bond to procure tbe discharge of a canal boat, seized by tbe sheriff of Oswego county, on a process issued by the county judge of that county under the act providing for tbe collection of demands against ships and vessels, (Laws of 1862, chap. 482.) Tbe referee reported in favor of tbe plaintiff .for a balance due bim on a demand originally belonging to bim, and on two demands which bad been assigned to bim for tbe sum of $231.65. From this judgment tbe defendants appeal.

Tbe canal boat in question, tbe J. K. Post, was owned by one J. D. Hartson, and was by bim taken to tbe dry dock of J. L. Pierce & Son, at tbe village of Phcenix, in Oswego county, for repairs, and she was repaired by tbe said J. L. Pierce & Son, and men in their employ, under a contract with J. L. Pierce & Son. Tbe latter were to do tbe work and furnish tbe materials. Tbe plaintiff Fralick, and bis assignors, were workmen for the said J. L. Pierce & Sons, and as such worked on the said boat in making tbe said repairs, and also on the other boats which were at tbe time in the said dry-dock for repairs. Tbe said John L>. Hartson paid J. L. Pierce & Son in full for tbe work done and materials used in tbe repairs of tbe said boat, including tbe work done by tbe plaintiff and bis assignors of tbe other demands. But Pierce & Son have not paid tbe plaintiff or bis said assignors. On tbe 17th day of October, 1874, Fralick, tbe plaintiff, made application to tbe county judge for a warrant to enforce bis claim by a seizure of tbe boat under tbe act of 1862, and such warrant was issued, and tbe boat was seized by tbe sheriff of Oswego county on tbe 16th day of November, 1874.

It is held that a canal boat is a “ vessel ” within tbe meaning of tbe law of 1862, before referred to. (Emmons et al. v. Wheeler et al., 3 Hun, 545; S. C. more fully in 5 Sup. Ct. Rp., by Thompson & Cook, 618; Crawford v. Collons, 45 Barb., 269.)

Tbe defendants insist that the law is unconstitutional and void, as attempting to confer on State courts jurisdiction of subject-matters of admiralty jurisdiction, in regard to which, jurisdiction is vested exclusively in tbe courts of tbe United States. (In re Josephine, 39 N. Y., 19; Vose v. Cockroft, 44 N. Y., 415.) But admiralty jurisdiction does not extend to contracts relating to a vessel wholly engaged in tbe internal commerce of a State, and no maritime lien or claim can be founded on such contracts, and tbe courts of tbe United States are wholly without jurisdiction in such eases. (Maguire v. Card, 21 Howard [U. S.], 248; Allen v. Newberry, id., 244; Brookman v. Hamill, 43 N. Y., 554, op., 558.)

The referee finds that “ the said boat J. K. Post was an ordinary canal boat, without sails or masts, towed by horses, and was designed to navigate the canals of this State.” This finding is prima facie sufficient to show that the business of the boat was to be wholly engaged in the internal commerce of the State, and therefore contracts relating to repairs and supplies to her, are properly the subject of State regulation, and the law of 1862 is valid as to such a vessel.

But we think the referee committed a fatal error in another respect. The action on the bond is, in effect, a jiroceeding m rem. The boat was seized by the sheriff and in order to procure its discharge from custody, the owner was compelled to enter into the bond on which the action was brought, with sureties, and if there was, in fact, no power or jurisdiction in the county judge, existing in the facts of the case, to authorize the issuing of the warrant and the seizure of the vessel, then the proceedings cannot be upheld, and this action cannot be maintained. (Vose v. Cockroft, 44 N. Y., 415, 418.)

The referee finds that the labor performed by the plaintiff and his assignors upon the boat, was performed at the request of J. L. Pierce & Son, and was charged by the plaintiff and his assignors on his and their books of account, to J. L. Pierce & Son. In fact the plaintiff and his assignors were workmen in the employ of Pierce & Son in their dock yard, and, as such, performed labor upon this and other boats indiscriminately as they were directed by Pierce & Son. The contract of Hartson, the owner, for the repairs of the boat was made with J. L. Pierce & Son, and he paid J. L.. Pierce & Son in full for all the labor and repairs done on the boat. Pierce & Son might have, by proceeding under the Statute of 1862, obtained a lien against the boat had the owner failed to pay them for the repairs. The following named persons only, can by their contracts, create liens under the act of 1862: (See § 1.) The master, owner, charterer, builder and consignee. Pierce & Son were neither, they were employed by the owner to repair. It cannot be that every hand employed in a boat yard can file a lien on every vessel which the owner of the yard is employed to repair, especially, when the owner has paid for the labor and materials furnished, and in full for tbe repairs to tbe party with wbom bis contract was made, and tbus tbe owner of tbe boat be made to pay many times over for tbe value of tbe work done and materials furnished. We tbink tbis point is fully decided in Hubbell v. Denison (20 Wend., 181); Low v. Austin (20 N. Y., 181); and Smith v. Steamer Eastern R. Road, (1 Curtis, 253.)

There existed, then, in tbe facts of the case, no authority entitling tbe plaintiff to proceed under tbe act of 1862, if we are correct in tbe views above stated, and tbe conclusion of law of tbe referee was erroneous and must be reversed.

Judgment reversed and new trial ordered before another referee, costs to abide tbe event.

Present — Mullin, P. J'., Talcott and Smith, JJ.

Ordered accordingly.


text:
    HIRAM LOSSEE, Respondent, v. HALSEY ELLIS and others, Appellants.

      Agreement not under seal to convey lands — Covenant to stand seized — what consideration must exist for — When a contn'act is not enforceable by a stranger to the consideration thereof.

    One Lydia J. Noyes, who was the owner of a farm, entered into an agreement with her husband, by which she agreed that her husband should have the use of the farm during his life ; that upon his death, if she was then living, she ' should have the use of it for her life; and after the death of both, she agreed that one, Malvina Noyes, the child of her husband by a former wife, should have all the right and title of the said Lydia therein “in consideration of $200, in hand paid.” The agreement was not sealed.

      Held, that the instrument purported to be a contract between husband and wife, and was void at law.
    That as it was not sealed it could not operate either as a conveyance or a covenant to stand seized.
    That, even if it were sealed, it could not operate as a covenant to stand seized for the benefit of Malvina, as it was not founded on a consideration of blood or marriage; and she being a stranger to any pecuniary consideration therein mentioned, could not take advantage of or enforce it.

      Appeal from a judgment in favor of the plaintiff, entered upon a report of a referee, in an action brought for the foreclosure of a mortgage.

      F. W. Hubbard, for the respondent.

      W. F. Ford, for the appellants.
   Talcott, J.:

This is an appeal from a judgment entered in favor of the plaintiff on the report of a referee.

The action is brought by the plaintiff, as the assignee of Lydia J. Noyes, of a bond and mortgage. The defense is, that the bond and mortgage was executed to Lydia J. Noyes as security for part of the purchase-money remaining unpaid on a sale by her of twenty-five acres of land in Jefferson county; and that the said Lydia, at the time of the sale and purchase, represented that she was the absolute owner, in fee simple, of the premises, and that the same were free and clear from incumbrance, which representations, it is alleged, were false and fraudulent, and made with intent to deceive and defraud the mortgagors. And the defendants claim to have the damages, incurred by the mortgagors by means of such false representations, set off or recouped against the amount due by the said bond and mortgage. The mortgagors are in possession of the land, and have never been evicted therefrom, and no attempt has been made to disturb their possession. The said Lydia J. Noyes conveyed with warranty.

The referee, by his findings of fact, negatives the fraud, and does not pass upon the question whether said Lydia J. Noyes had a good title or not; but the defendants insist that the finding of fact that the representations made by Mrs. Noyes were not fraudulent was contrary to the evidence, and that a new trial should be ordered for that cause.

The claim on the part of the defendants is, that, at the time of the conveyance, the said Lydia J. Noyes had only a life estate in the premises. And the following facts were proved, or are claimed by the defendants to have been proved : Lydia J. Noyes held a contract for the purchase of the premises in question from Loren Bushnell, by wbicb it was agreed that, upon the payment of certain sums therein specified, at the times therein stated, Bushnell should convey to the said Lydia J. Noyes, in fee, the premises in question. While she held this contract, and when a portion of this money had been paid by her, she was induced by the solicitation of her then husband, Nathan Noyes, now deceased, to sigh an instrument of the following terms, viz.:

“Articles of agreement between Nathan and Lydia Noyes, as follows, viz.: I, Lydia Noyes, agree to let Nathan Noyes have the use and control of my farm, situated in the town of Orleans, in the county of Jefferson, lying between the farm of Joseph M. Beckwith and Columbus Goodrich, containing twenty-five acres, to have the use of it diu-ing the life of the said Nathan Noyes, and after his decease, if the said Lydia Noyes is yet living, the use and control of the premises reverts back to her; and after the death of both of the above-named parties, the said Lydia hereby agrees that Malvina Noyes is to have all the said Lydia’s right and title to the same by deed, in consideration of two hundred dollars in hand paid.
“ Dated at Orleans the 19th day of June, 1850.
(Signed) “LYDIA J. NOYES.
“ In presence of Joseph M. Beckwith.”

The above instrument purports to have been proved by the subscribing witness, before a justice of the peace, on the 1st day of September, 1860, and to have been recorded in the office of the clerk of Jefferson county, in April, 1861.

The Malvina Noyes mentioned in the said instrument, now Malvina Forsyth, is a daughter of Nathan Noyes by a former marriage, and was at the time of the execution of the instrument living with her father and step-mother on the premises in question; and she testifies that the said instrument was delivered to her by her father and step-mother in the year 1861, when she left home to reside in Chicago. The claim of the defendants is, that the instrument in question created a title in the said Malvina after the lives of Nathan and Lydia J. Noyes, by way of covenant, to stand seized or otherwise, and that, consequently, the title conveyed to the mortgagors by Lydia J. Noyes was defective, and her representations that she had a good and unincumbered title were false and fraudulent*

After tbe making of tbe instrument hereinbefore recited, Bushnell, the vendor named in the contract of sale, conveyed the premises to Lydia J. Noyes in pursuance of the agreement.

It is claimed by the defendants that the plaintiff is not a bona fide purchaser for value.

The question then arises, whether Malvina Noyes, now Malvina Forsyth, acquired any title to or interest in the premises by virtue of the instrument in question, because, if she did not, then it is wholly immaterial whether the finding as to whether the representations of title, made by Lydia J. Noyes to the mortgagors at the time of the sale and purchase, were fraudulent or not?

The instrument purports to be a contract, by and between parties who were, at the making of it, husband and wife, and, therefore, was wholly void at law. The instrument does not purport to have been sealed; it is, therefore, neither a conveyance, as assumed by the counsel for the appellant, nor a covenant. (1 Rev. Stat. [2d ed.], p. 731, § 137; 4 Kent’s Com., 450.)

It could not, in any form, operate as a covenant to stand seized for the benefit of Malvina, because it was not founded on the consideration of blood or marriage. Mrs. Noyes, the supposed grantor, was not connected by blood to Malvina, so that if the instrument of the 19th of June, 1858, had been in form a conveyance, which might have otherwise operated as a covenant to stand seized, it could not have so operated in the present case for want of the requisite consideration. (Hayes v. Kershow, 1 Sandf. Ch., 258; Corwin v. Corwin, 6 N. Y., 342; Schott v. Burton, 13 Barb., 173; Rogers v. Eagle Fire Ins. Co., 9 Wend., 611; 4 Kent’s Com., 493.)

At most, and without reference to the fact that the contract was between parties standing in the relation of husband and wife, and, therefore, void, the instrument was nothing more than an agreement to convey to Malvina the remainder by deed. Though the instrument recites a pecuniary consideration, if any was in fact paid, Malvina was a stranger to the consideration, and as to her, it was a mere voluntary agreement to make a future conveyance, of which, specific performance could not be enforced, according to the well-settled principles of courts of equity.

We are, therefore, of the opinion that the finding of the referee on the question of fraudulent intent on the part of Lydia J. Noyes, is wholly immaterial, and that for aught that appears in the case, Mrs. Noyes was, at the time of the conveyance by her, seized of an absolute estate in fee, in the premises which she conveyed, and to secure a part of the purchase-money unpaid on which, the bond and mortgage held by the plaintiff were given.

The judgment must be affirmed with costs of the appeal to be paid by the appellants.

Present — Mullin, P. J., Talcott and Smith, JJ.

Ordered accordingly.


author: Mullin, P. J.:

text:
    THE PEOPLE OF THE STATE OF NEW YORK ex rel. THE BOARD OF EDUCATION OF UNION FREE SCHOOL DISTRICT NO. 2, TOWN OF ONONDAGA, Appellant, v. JAMES W. HOOPER, School Commissioner, etc., Respondent.

      School commissioner — power of, to alter or divide union free school district — notice as to.

    A School Commissioner has power, under the laws of this State, to alter or divide a Union Free School District.
    An order to that effect cannot, however, be made without giving to the trustees of the district a week’s notice that at a time and place specified by him he will hear their objections to the proposed alteration.
    Certiorari to review the action of the respondent, as school commissioner, in making an order dividing Union Free School District No. 2 of the town of Onondaga.

      D. Pratt, for the relator.

      Fuller da Yarni, for the respondent.
   Mullin, P. J.:

■ This case comes before us on the return of James W. Hooper, School Commissioner of the second district of Onondaga county, to a writ of oertiora/ri issued upon the application of the Board of Education of the Free School District No. 2 of the town of Onondaga.

An application was made to Commissioner Hooper to divide tbe Union Free School district, in the town of Onondaga, so as to set off from said district the territory embraced in the village of Dan forth, in said town. The commissioner denied the application and an appeal was thereupon taken from the order of the commissioner to the superintendent of public instruction, and he reversed the order and directed the commissioner to proceed and divide the district in conformity to the prayer of the petition delivered to him for that purpose.

In obedience to this order the commissioner, on the 3d July, 1877, convened the board of trustees of said union school district for the purpose of obtaining their consent or refusal to the division of the district and they jiassed a resolution refusing their consent to the division of the district, five of the trustees voting in favor of the resolution and one against it. On the fifth July the commissioner made and filed with the town clerk an order dividing said union school district and forming a new district from the part set off, which was numbered No. 29, and included the village of Danforth. As the trustees of the union district refused their assent to the division the commissioner directed the division to take effect on the eighth October following. On the same day the commissioner served on the trustees of the union district school a notice that he had made and filed the order above-mentioned, and that he would meet the parties interested in said matter at the school-house in said district on the afternoon of July thirty-first to hear cause why his said order should not take effect, and suggesting to them to request the attendance, at the time and place specified, of the town clerk and supervisor.

After the decision of the appeal from the order of the commissioner refusing to divide said union district, the commissioner applied to the superintendent to reopen the case on said appeal on the ground that the action of the commissioner might have injuriously affected the rights of the trustees of said district. The application ,was refused, unless within ten days after notice of the decision a supplemental petition was filed in said department by said trustees showing that their rights had been prejudiced, and giving reasons why a rehearing should be granted. This order was dated 5th July, 1877. A suppleznental petition was presented to the department by the trastees of said district, but the prayer of it was refused.

The relator’s counsel asks for reversal of the order dividing said school district on two grounds: First. Because the commissioner has no power to divide or alter a union free school district; and, second, that the order of the commissioner was made without giving to the trustees of said district an opportunity to be heard.

It is urged, in support of the first proposition, that the legislature has not conferred on commissioners of schools the power to divide or alter a union school district. That the power is limited to districts other than free school districts; and that the State superintendent has held that districts of the kind last named can be altered only by the legislature, and the legislature has on sevez’al occasions passed laws 'altering the free school districts.

Union free school districts may be formed in any school district in the State by the votes of the inhabitants, and sevez’al districts may be consolidated into a single district by the inhabitants of the several districts. When a single district is converted into a union fz’ee school distzúct the only effect of the change is to elect a different body of men to manage its affairs, and to enable them to raise by tax, for the support of the school, larger sums than districts not organized as free schools are permitted to raise, and to enable them to organize an academical department. There is nothing in the provisions authorizing the attainment of these objects that 'intei’feres with the division of a free school district It would be exceedingly unwise to foz’bid the alteration of free school districts, as the same causes must, in the nature of things, operate upon them, rendering alterations necessary, that operate in other districts. Tillages spring up in unlooked-for localities, z-endezúng it necessary to erect new schoolhouses, to change their locations for the convenience of the inhabitants, and no reason is perceived why union free schools should be exempt from the operation of the same causes.

In districts formed of several districts or parts of districts the same considerations present themselves against the wisdom or propriety of prohibiting their alteration. Causes affecting unfavorably the common schools are constantly at work, rendering alterations in them indispensably necessary. Population changes by deaths and removals; the young grow older and leave the schools, and there may not be others to fill their places — as farmers grow richer they buy up the small farms,' and the seller removes to the west. Streams on which mills were erected, and gave support to a considerable population, dry up, and the people look elsewhere for bread. No sane man can disregard these considerations; they must be provided for or public interests must suffer. It is true the legislature has not, in terms, authorized the alteration of union free school districts, nor was it necessary; the power is given in language sufficiently comprehensive to embrace them; and no reason can be assigned why they should not be subject to alteration as the other districts of the State.

Since the amendment of the Constitution forbidding the legislature to pass special laws in cases in which relief can be granted by general laws, school districts cannot be altered by legislation as we have no general laws on the subject. The opinion of the State superintendent is entitled to the highest respect, but superintendents differ in their views of the law as to the power to alter union school districts. The present superintendent has decided in this case that the power exists. I am constrained to con cm’ with him.

By section 4 of title 6 of the Code of Public Instruction the commissioner, when he makes an order altering a school district, is required to give the trustees a week’s notice that at a time and place specified by him he will hear their objections to the alteration. After the reversal of the commissioner’s decision not to alter the district he served the notice required by the section last mentioned and designating the afternoon of the 31st July, 1877, as the time and the school-house of the district as the place for hearing the parties in opposition to said order. It does not appear that the commissioner or the trustees appeared at the time and place designated, nor that any thing was done in reference to it.

The trustees, as the representatives of the inhabitants, had the right to be heard before the order would become obligatory, and they could not be deprived of that right. Under the presumption of the due performance of official duty we might proceed on the assumption that the commissioner appeared at the time and place designated by him, but the papers before us forbid that assumption. Tbe commissioner, in bis return, says tbat subsequently to tbe service of tbe notice of the order altering tbe district, on tbe trustees, and designating a time and place for bearing them in opposition to said order, it was withdrawn by direction of tbe State superintendent, so that it is conclusively proved that tbe trustees have never been given an opportunity to be beard as by law they should have been.

Neither tbe superintendent nor tbe commissioner could deprive tbe trustees of this statutory right. (Fonda v. Canal Appraisers, 1 Wend., 288; The People ex rel. Citizens’ Gas-tight Co. v. The Board of Assessors, 39 N. Y., 81; People v. Bd. of Police, id., 506.)

For this defect in tbe proceedings tbe order of the commissioner must be reversed.

Tbe question in relation to tbe injunction is reserved, until it is definitely decided whether tbe district shall be divided.

Present — Mullin, P. J., Talcott and Smith, JJ.

Proceedings reversed.


text:
    CHARLES A. SWEET, Appellant, v. THE BUFFALO, NEW YORK AND PHILADELPHIA RAILWAY COMPANY, Respondent.

      Acquisition of fee of land by city —■ uses to which it may apply it.

    By chapter 547 of 1864, the city of Buffalo was authorized to lay out a public ground for the purpose of maintaining and protecting a sea-wall or breakwater along the shore of Lake Erie, and to acquire title in fee to the necessary lands by compulsory proceedings and by conveyances. The act provided that, upon payment or tender to the owner of the compensation awarded for said land, the fee thereof should vest in the city for the said purpose.' Subsequently, the defendant, acting in pursuance of a permit from the common council, laid its track upon the said land and used the same for its road. This action of ejectment was brought by the plaintiff, who owned a portion of the land when it was taken by the city, claiming that the city could confer, and the plaintiff acquire, no right t'o use the land for that purpose; and that, as against defendant, plaintiff was entitled to its possession.

      Held, that as the fee was vested in the city, and as, under no circumstances, could the land revert to the plaintiff, he had no greater right to complain of the use of the land hy the defendant than any other citizen. That in any event an action in ejectment could not he maintained.
    Appeal from a judgment in favor of tbe defendant, entered upon tbe trial of this action by tbe court without a jury.'

      A. P. La/ruvng, for tbe appellant.
    Tbe act conferring tbe power and delegating the right of eminent domain to tbe city for tbis specific public use is to be strictly pursued and cannot be extended by implication, or beyond what is expressed, except as necessary to accomplish tbe purpose for which it was granted; beyond that tbe statute creating tbe power is to be strictly construed and limited to the use and purpose expressed. (Potter’s Dwarris on Statutes, 25Y; Ya/nhorn v. Dorramce, 2 Dali., 316; In re N. Y. and M. B. B. B. Go. v. Ni/p et al., 46 N. Y., 546; B. and S. S. B. B. Go. v. Dams, 43 id., 13Y, 146; Newell v. Wheeler, 48 id., 486; Ex pa/rte Ward, 52 id., 39.) Tbe word “ fee,” as used in tbe act, does not import an estate of inheritance or perpetuity, it is used rather to create an interest, publici juris, to continue so long as it is required for that purpose, and to tbe extent necessary to carry out tbe intention of tbe act, being according to tbe primary definition by Blackstone, “ an estate held of a superior.” (2 Bl. Com., 105.) Tbe city, under tbis act, could take what was needful to effectuate tbis purpose, and tbe original owner was deprived of nothing more. (People v. Kearn, 2Y N. Y., 196, 19Y.) Again, tbe strict or technical definition of tbe term “ fee ” is not to control as to character of tbe estate created. (2 Bev. Stat., chap. 1, tit. 5, § 2; Bridges v. Pierson, 45 N. Y., 604; Denling v. Bogers, 22 Wend., 489.) Taking tbe whole statute together for tbe .purpose of determining what power tbe legislature intended to confer it is manifest that tbe city acquired an easement or servitude in tbe land and not tbe title, and that it was all that was necessary to be acquired for tbe purpose of effectuating tbe object of tbe statute and is within tbe exact legal definition of tbe term, viz.: “A liberty, privilege or advantage in land, without profit, existing distinct from an ownership in tbe soil.” {Pomeroy v. Mills et al., 3 Yt., 208; 1 Crabb’s Beal Prop., 125, § 115.) Tbe rights to tbe land thus appropriated when no longer required for tbe use specified would become absolute in the owner since it is apparent, from a fair construction of the statute, that it was not the intention of the legislature to vest an absolute title in the city by these proceedings, or any title beyond what was necessary for the purpose designated. A greater estate or right in lands cannot be taken for a public use than is declared necessary and is actually applied to it. (Matter of ALba/ny Street, 11 Wend., 150, 151; Matter of O'herry Street, 19 id., 667; Barbow v. Townsend, 1 Mylne & Keene, 506; Hooher v. W. cmd JY. T. R. Go., 12 Wend., 371; Dwnham v. Williams, 36 Barb., 137.) This statute does not purport to vest the title in the city for ever, but simply for the limited use; and by restraining the power of alienation to the United States for the same purpose raises the implication that it cannot be conveyed to any other person, or for any other use, so that there is a resulting use as to the residue by implication of law in favor of the grantor. (2 Eonbl. Eq. [2d English ed.], 132; 1 id., 439; 4 Kent Com. [5th ed.], 306; 1 Cruise Dig., 399, tit. 11,' chap. 4, §§ 20, 32, 34.) The plaintiff having the title to the land in question subject to the right of the city to use it for the purposes of a sea-wall may maintain trespass against any one entering upon it for any other purpose than to construct or maintain the same, or ejectment to .recover possession, if acquired for any other purpose, or an action to restrain the use or appropriation of the land by which the owner’s right will be impaired or the burden upon his estate increased. ( Williams v. The JY. Y. O. R. R. Oo., 16 N. Y., 97; • Greigh v. R. cmd B. R. R. Go., 37 id., 404; Brondge v. Warner, 2 Hill, 145; Mahone v. JY. Y. O. R. R. Go., 24 N. Y., 658; Ga/rpenter v. O. cmd S. R. R. Go., 24 id., 655; Wager v. Troy Union R. R. Go., 25 id., 526; Lozier v. The JY. Y. G. R. R. Go., 42 Barb., 465.)

      Shermcm 8. Rogers, for the respondent.
   Mullin, P. J.:

In 1864 the legislature passed an act entitled “An act authorizing the common council of the city of Buffalo to lay out a public ground for the purpose of maintaining and protecting a sea-wall or breakwater, along the shore or margin of Lake Erie.” (Chap. 547 of the Laws of 1864.)

By the first section of said act the common council was authorized to lay out, make and open a public ground in said city for the purposes mentioned in the title of said act, and it was also authorized to acquire title to the strip of land required for such purposes in the same manner as the common council was, by the charter of said city, to acquire lands for laying out streets and highways in said city. The city was also empowered to acquire title to the land by conveyance from the owner. It was provided by the same section that, upon payment or tender to the owner of the compensation awarded for said land, the fee thereof should vest in the city for the purpose aforesaid, and thereafter the said land should remain a public ground for the maintenance and protection of a sea-wall or breakwater. The city acquired title to the strip of land mentioned in the statute for the purposes specified therein. The plaintiff was the owner of said land when proceedings were instituted to acquire title.

In 1874 the common council, by the votes of two-thirds of its members, gave permission to the defendants to lay its track and run its locomotives and cars on and along the piece of ground taken for the breakwater. The defendants, in pursuance of the permission thus granted, laid the track of its road over said strip of land and has ever since run its engines and cars over the same.

In May, 1874, the person owning said premises, at the time the city acquired title thereto, conveyed the same to the plaintiff in this action, who sues to recover possession of said strip of land, on the ground that the city acquired the land for the purpose of a sea-wall to protect the shore of the lake from being washed away by the waters of the lake; and that the defendant could not acquire legal right to lay its track and run its trains over said premises; and that, as against defendant, the plaintiff is the legal owner of the premises, and entitled to the possession.- The defendant, in its answer, denied the complaint, and set up, by way of defense, the acquisition of the fee of said land by the city, and a license, by the votes of two-thirds of • the members of the common council, for defendant to locate its tracks and run its trains thereon. On the trial at Special Term the facts were agreed upon, and the court ordered judgment dismissing the complaint, and from it the plaintiff appeals.

Chancellor Kent, in his Commentaries (vol. 4, p. 5), speaking of a title -in fee, says it is an estate of perpetuity, and confers an unlimited power of alienation, and no person is capable of having a greater estate or interest in land.

When, therefore, the city, by virtue of the proceedings authorized by the act of 1864, acquired the fee of the land for a breakwater, the title of the owner was completely divested, and he had thereafter no other or greater interest in said land than any other citizen of Buffalo. He had no color of title on which to sustain an action of ejectment. The title can in no contingency revert to the original owner or her grantees; and I apprehend that the plaintiff has no greater or better right to complain of the use of the premises by the defendant than has every other inhabitant of the city.

If the plaintiff had the right to insist that the city could not lawfully consent to the use of the premises for any other purpose than that for which it was acquired, that would not entitle him.to maintain ejectment.

The judgment should be affirmed, with costs.

Present — Mullin, P. J., and Smith, J.; Taloott, J., not sitting.

Ordered accordingly.


text:
    THOMAS A. HUNGERFORD, as Receiver, etc., Respondent, v. AARON CARTWRIGHT, WILLIAM H. STRAIGHT and MALINTHA C. STRAIGHT, Appellants.

      Assignment of property, in consideration of a covenant by the assignee to suppo?'t the assignor — does not constitute a ti-ust.

    This action was brought by the plaintiff, as receiver of one 0., appointed in proceedings supplementary to an execution issued upon a judgment recovered against the latter. After the creation of the debt upon whic.h the judgment was recovered, O. entered into a written agreement with one S., his son-in-law, by which he conveyed to S. all his personal property and a contract for the purchase of land, amounting, in all, in value, to about $2,100; and S. agreed, in consideration thereof to support the said O. during his life, and his minor son until he attained the age of sixteen years, and to send the latter to a common school.

      In this action, brought by plaintiff to annul the transfer, sell the property and pay the debt from the avails, the court held that the transfer was, in fact, an assignment of said property in trust for the use of 0., and such trust was void as against the creditors of the latter. Held, that this was error.
    Appeal from a judgment in favor of the plaintiff, entered upon the trial of this action by the court without a jury.

      Theo. 8. Deem, for the appellants.

      J. P. Vcvrnvm, for the respondent.
   Mullin, P. J.:

On the 6th July, 1875, M. S. Crabb and the defendant Aaron Cartwright made and delivered their promissory note for $200 to Brewerton, Gordon & Co., payable three months after date at the First National Bank of Lockport. Crabb was the principal debtor, and Cartwright his surety. A judgment was recovered on this note against the makers, by the payees, on the 18th November, 1875, and an execution thereon duly issued to the sheriff of Monroe county, who returned the same unsatisfied on the 3d December, 1875. Proceedings supplementary to the execution were thereupon commenced against the defendant Cartwright, which resulted in the appointment of plaintiff as receiver of the property of said Cartwright.

It appeared, in the course of the supplementary proceedings, that when Cartwright signed the note he was the owner of a considerable amount of personal property; and that afterwards, and on or about the 23d August, 1875, he entered into a contract, in writing, with one Wm. H. Straight, his son-in-law, under the hands and seals of both parties, whereby, in consideration of the covenant of Straight to support Cartwright during his life, and his minor son until he attained the age of sixteen years, and send him to the common school, he, Cartwright, conveyed to Straight his property, and released him from certain claims he (C.), had against him. Cartwright also transferred to said Straight a contract for the sale and conveyance of land to one Albert R. Polock. The whole value of property thus conveyed was $2,100.

The plaintiff, after his appointment as receiver, demanded of Straight and his wife the property above mentioned, who refused to deliver the same, and then this action was commenced to annul said transfer by Cartwright, and for authority to the plaintiff to sell said property, and out of the avails to pay the judgment above mentioned and the costs of this action.

Straight and his wife were served with process, and they appeared, and, in their answers, they allege that the transaction between Straight and Cartwright was in perfect good faith, and without any intention to defraud C.’s creditors; and they set forth the reasons why they could not be held to be guilty of fraud. He also avers that, before the signing of the note by C., he (Straight) had supported said O. and his minor son, and advanced money for their benefit; and he had supported them after the note was given, and before the assignment by C. to him, all of which was done under and in pursuance of a verbal agreement entered into before the written contract was executed, and which was substantially the same as the written agreement.

Mrs. Straight avers that she had no dealings with 0., but that she obtained the land contract from her husband. The defendants also insist, in their answers, that Aaron Cartwright, Jr., should be made a party defendant.

The cause came on for trial at a Special Term in Rochester, and the parties conceding the facts to be substantially as stated’above, the court overruled defendants’ objections to the maintenance of the action because of the non-joinder of the younger Cartwright.

The counsel for Mrs. Straight moved that the cause be dismissed as to her, on the ground that she was improperly made a defendant. The motion was denied, and defendants’ counsel excepted.

The defendants moved for a nonsuit on the grounds:

First. That the facts proved did not constitute a cause of action.

• Second. That no trust was expressed or declared by said contract, and plaintiff could not recover under his complaint.

The motion was denied, and defendants’ counsel excepted.

The defendants then offered to prove that the contract set forth in the complaint, and the several assignments of property and choses in action were given, and entered into for other considerations than are set out in the contract, and specifically as they were set out in the answer of the defendant Straight, which considerations entered into and formed a part of the consideration for the contract and assignment. The plaintiff’s counsel objected to the evidence. The court sustained the objection and excluded the evidence, and defendants’ counsel excepted. The court thereupon held and decided that the contract for support and the transfer of the property must be construed together, and thus construed they constitute an assignment of said property in trust for the use of said C., and that such assignment is void as against the creditors of C., and as against the plaintiff in this action, and he further held that plaintiff was entitled to judgment against the defendants as demanded in the complaint. To the conclusions of law the defendants’ counsel excepted.

I regret that the learned judge who tried this cause did not give his reasons for the conclusions of law at which he arrived, as it would enable us the better to comprehend his views, as well in regard to the facts as the law. The respondent’s counsel in his points repeats this position taken by the judge, but refers to no authority in support of them.

The contract between Straight and Cartwright is merely an agreement by the former to support the latter and his son, in consideration of the conveyance of the property mentioned in it. The word “trust ” is not mentioned in it, nor any language from which the intention to create a trust can be inferred. If this contract between the parties creates a trust, then one is created in every deed of. land and every transfer of personal property that is made. I have searched with some care, but am wholly unable to find any authority for holding the contract between the parties to be a trust. And I am persuaded that no case can be found which would authorize this or any other court to appropriate the property conveyed to Straight to the support of C. and his son, or ■ restrain its appropriation to any other use.

The respondent’s counsel seems to insist that the transfer to Straight and his wife should be held to create a trust for the benefit of C., because if not so held the judgment creditors could not reach the property in payment of their debt. The creditors would not object to having such an instrument declared to be a trust, provided the property was applied in payment of their debts, but I do not think the argument would be appreciated by any one else.

The return of the execution walla Iona was prima faoie evidence of insolvency and gave a court of equity jurisdiction to entertain an action to set aside any and all fraudulent transfers by a judgment debtor of his property, and to apply the property fraudulently transferred to the payment of his judgment creditors. Evidence to show that the judgment debtor had property not transferred, sufficient to satisfy the judgment against him, is not competent on the trial of the creditor’s suit. If the fact was so the remedy of the debtor was by motion to set aside the return and thus compel the creditors to get a truthful return.

As this case has not been tried on the ground that the conveyance was fraudulent as against the judgment creditor, I will leave the discussion of that question until the case is again tried and the parties are heard in reference to it if they shall so desire. The judgment is reversed and a new trial granted, costs to abide event.

Present — Mullin, P. J., Talcott and Smith, JJ.

Judgment reversed and new trial ordered, costs to abide event.


text:
    MORRIS F. SHEPPARD, Plaintiff, v. FRANK EARLES, Defendant.

      Sale of property und&r chattel mortgage — no implied wa/rra/nty of title arrises.

    Upon a sale of property, by virtue of a obattel mortgage, the proceeding is notice to tbe public tbat tbe mortgagee is selling not bis own title to tbe property, but tbat wbicb be bas acquired through tbe mortgage, and no warranty of title of tbe property so sold is to be implied against tbe mortgagee.
    Motion for a new trial on exceptions ordered to be heard in the first instance at the General Term, after a verdict in favor of the plaintiff.

      Brown & Wood, for the plaintiff.
    The defendant, in selling the horse to the plaintiff, must be held to have warranted the title. (Defreeze v. Trwm/per, 1 Johns., 274; Mg Coy et ad. v. Archer, 3 Barb., 323.) It is immaterial even if buyer have notice of a prior claim, as for instance a levy. He may purchase .and rely on the warranty. (Dresser v. Ainsworth, 9 Barb., 619 ; opinion of Justice Welles, 625; Story on Contracts, §§ 832, 833, and note.) The plaintiff having alleged and proved his special damage, i. e., the action against him, the notice to defendant and his failure to defend, the recovery against him and his own costs and expenses in the defense, is entitled to judgment for the full amount of the recovery and his expenses. (Brewster v. Countryman, 12 Wend., 446; Delaware Bank v. Jarvis, 20 N. Y., 226 ; Whitney v. Hational Bank, 45 id., 303.)

      D. B. Prosser, for the defendant.
    The rule of implied warranty is founded upon the ground that a party in the possession of personal property, and selling it as his own, is bound to know the source of his title, and whether he is the owner or not. (Hoe et al. v. Sanborn, 21 N. Y., 552.) Unless the party selling is in the possession, it is well settled that there can be no implied warranty. (McCoy et al. v. Archer, 3 Barb., 323; Edñck v. Grim, 10 id., 445; Scranton et al. v. Clark, 39 N. Y., 220.) The most that the plaintiff would have been entitled to recover, even if there could be a warranty implied, was the sum of sixty-five dollars and fifty cents, paid by him to the defendant, and the interest and costs. It has been frequently held that the warranty of the title of personal property was similar to the covenant for quiet enjoyment. Under such a covenant the plaintiff can recover only the sum paid, with interest and costs. (McCoy v. Archer, 3 Barb., 323 ; Pew v. Barber, 3 Cowen, 286 ; Burt v. Dewey, 40 N. Y., 283 ; S. C., 31 Barb., 540 ; Sweetman v. Prvnce, 36 N. Y., 224, page 233 at the end of the opinion.)
   Mullin, P. J.:

This action is brought to recover of the defendant damages for a breach of warranty of the title to a horse, sold by the defendant upon a chattel mortgage given to the plaintiff by John O’Neil, to secure the payment of fifty dollars on the first of October next after date of said mortgage. The mortgage was dated 14th April, 1875, and was upon a pair of horses and a wagon.

When the debt became due it was not paid, and defendant delivered the mortgage to one Payneer to get the money upon it, and if not paid to sell .the mortgaged property. On the 27th December, 1875, the debt not having been paid, Payneer took possession of one of the horses and sold it at public auction to the plaintiff, who was the highest bidder, and he paid the purchase-money. Soon after the sale, Catharine O’Neil claimed that the horse sold was hers, and she sued the plaintiff and recovered judgment against him for the value of the horse, together with costs of the action.

The plaintiff then brought this action, and on the trial the court directed a verdict in favor of the plaintiff for the amount of the judgment recovered against him by Mrs. O’Neill and the costs paid by him to his own counsel' for defending the action. It appeared upon the trial that the plaintiff, after the action was brought against him, gave notice of that fact to the defendant and requested him to defend the action. This the defendant refused to do. A witness for the defendant testified that during the sale, and before the horse was struck off to the plaintiff, he informed the plaintiff that Mrs. O’Neil claimed the horse to be her property and that she was going to sue for it. The plaintiff was examined as a witness in his own behalf, and denied that he was informed, before the horse was struck off to him, of the claim of Mrs. O’Neil.

It is well settled that on a sale of personal property by a person in possession a warranty of title is implied. (1 Wait’s L. and P., 530; McCoy v. Artcher, 3 Barb., 323; Scranton v. Clark, 39 id., 273; Defreeze v. Tremper, 1 Johns., 274.) But when the sale is made by an officer or trustee no warranty of title is implied. (1 Chitty on Con., 626, note 10.) It seems to me that a warranty of title of property sold by virtue of a chattel mortgage should not be implied against the mortgagee. The proceeding is notice to the public that he is not selling his own title to the property, but the title he acquired through the mortgage. (Rudderow v. Huntington, 3 Sandf., 252.) If I am right in this, the recovery against defendant for the costs of'the suit brought by Mrs. O’Neil was illegal.

New trial granted, costs to abide event.

Present — Mullin, P. J., Taloott and Smith, JJ.

New trial ordered, costs to abide the event.