author: Van Brunt, P. J.: Daniels, J.: Brady, J.

text:
    In the Matter of the Accounts of MICHAEL M. VAN DYKE, Deceased, as Administrator of ISAAC VAN DYKE, Deceased.

      Proceedings to compel an administrator to account before a surrogate — within what time they must be commenced — not changed by the provision, as to actions by legatees, contained in section 1819 of the Code of Givil Procedure.

    Section 1819 of the Code of Civil Procedure declaring that if, after the expiration of one year from the granting of letters testamentary or letters of administration, an executor or administrator refuses upon demand to pay a legacy or distributive share, the person entitled thereto may maintain such an action against him, as the case may require, and providing that, “for the purpose of computing the time within which such an action must be commenced, the cause of action is deemed to accrue when the executor’s or administrator’s account is judicially settled, and not before,” was intended to apply to actions only, and not to special proceedings, and it affected no change in the laws prescribing the time within which proceedings to compel an executors or administrator to account before a surrogate must be commenced. (Brady, J., dissenting.)
    Appeal by James O. Van Dyke, as administrator under tbe will annexed, of Michael M. Van Dyke, deceased, from an order of the surrogate of the county of New York, directing him to render an account of the proceedings of Michael M. Van Dyke, as administrator of Isaac Van Dyke, deceased.

      Edward G. Black, for the administrator, appellant.

      William B. Hall and A. Melhado, for the respondent.
   Van Brunt, P. J.:

The objection which was presented to the learned surrogate upon this application was that it was barred by the statute of limitations, and in an opinion given in this matter, in which are reviewed all the sections of the Code applicable to the question and numerous authorities, he has conclusively shown that the objection is well taken, and that the appellant is entitled to the protection of the statute, unless he is brought within the provisions of section 1819 of the Code of Civil Procedure. That section declares that if after the expiration of one year from the granting of letters testamentary or letters of administration an executor or administrator refuses upon demand to pay a legacy or distributive share, the person entitled thereto may maintain such an action against him as the case requires, but for the purpose of computing the time within which such an action must be commenced the cause of action is deemed to accrue when the executors’ or administrators’ account is judicially settled, and not before.

It is urged that section 1819 applies only to an action against an executor or administrator for the payment of a legacy or distributive share, whilst the proceeding sought to be initiated in the Surrogate’s Court was simply a special proceeding for an accounting. Unless, therefore, special proceedings are to be included within the scope of section 1819, the statute of limitations applied to tlie proceeding at bar. There is nothing in section 1819 which indicates that it was intended to apply to anything but an action against an executor or administrator for the payment of a legacy or distributive share. The language of the section refers to an action, and to an action only, and does not include in its provision in any way a special proceeding. Throughout the Code the distinction is preserved between special proceedings and actions, and in the definition of the word action, contained in chapter 449 of the Laws of 1876, no reference is made to a special proceeding, but where the word action is used it is stated that it refers to a civil action. The distinction between civil actions and special proceedings, in reference to the statute of limitations, is expressly recognized by section 414 of the Code, which provides that the provisions of this chapter apply (referring to chapter 4 of the Code of Civil Procedure, entitled “ Limitation of the time of enforcing a civil remedy.”), and constitute the only rules of limitation applicable to a civil action or special proceeding, except, etc. It would, therefore, appear that when in section 1819 actions were simply referred to, there was no intention on the part of the legislature to include special proceedings therein, and that section 1819, as far as these proceedings are concerned, affected no change in the law, and that' the statute of limitations remained the same and had run against this application at the time of its attempted initiation before the surrogate.

The order should, therefore, be reversed, with ten dollars costs and disbursements.

Daniels, J.:

The intestate died on the 18th of August, 1874, and Michael M. Yan Dyke was appointed administrator of his estate on the fifteenth of September of the same year. He died in September, 1885, and the appellant was appointed the administrator, with the will annexed, of his estate in October of that year.

The petition for an accounting was presented by Elma Hyde, in September, 1886. She was a daughter of the intestate, and with Lilly Sims,'were his only next of kin. The .statute of limitations was interposed as an answer to the petition, but that was overruled, by the surrogate and an accounting directed. 'Whether this action of the surrogate is entitled to legal support is dependent upon the construction required to be placed upon certain sections of the Code of Civil Procedure. That the proceeding before the surrogate was a special proceeding is conceded, as it necessarily must be, by each of the contesting parties. And as a special proceeding it was subjected by section 414 of the Code of Civil Procedure, to the same rules of limitation as have been made applicable to civil actions subject to certain exceptions, one of which alone it will be necessary hereafter to notice. And having been subjected to these rules of limitation, according to the provisions of section 382 of the same Code the proceedings to' enforce an accounting should be commenced within six years after the right to require it shall have accrued. Por it is to enforce an obligation or liability not arising upon a judgment or a sealed instrument. And either this provision or that contained in subdivision two of the same section relating to a liability created by statute, in its language includes the case of a proceeding against an administrator for an accounting.

By section 2724 of the Code, an administrator may be required by the surrogate to submit to a judicial settlement of his accounts after the expiration of one year from the time the letters were issued to him. The obligation to account accrues at that time, and under the provisions of section 3S2 already referred to, the right to require an accounting will be bai’red after the expiration of six years frcm the time when the accounting may be ordered according to section 2724 unless some other provision of the Code has prescribed a different rule. It has been contended that this has been done by section 1819 and that this section prevents the application of section 414, the first subdivision of which excepts special proceedings from the operation of the section, where a different limitation is specially prescribed by law.

But section 1819 of the Code contains no limitation of time within which the administrator may be called to an'account. It contains no provision whatever on that subject, but it simply declares that the action may be maintained against an administrator for the payment of a legacy or distributive share, after the expiration of one year from the time of the granting of letters of administration, and then follows the provision supposed to exclude the case of an administrator from the statutory limitations which have already been mentioned. And tbat provides, “for the purpose of computing the time within which such an action must be commenced, the cause of action is deemed to accrue when the executors’ or administrators’ account is judicially settled, and not before.” This provision, it will be seen, contains no enactment whatever concerning the time within which the accounts may or shall be judicially settled. It does not prescribe a different limitation from that mentioned m the preceding sections, within the meaning of the phraseology contained in subdivision 1 of section 414. But without the least intimation as to the period during which the accounting may be enforced it has provided that the action mentioned in the section shall not be commenced until the accounting has actually taken place. Within what time the accounting shall take place, or the administrator may be required to account, has formed no part of this section. But that has manifestly been left to the preceding sections which contain particular directions concerning the time and the effect of omitting to institute the proceedings within that time. These sections are in no respect inharmonious, for section 1819 provides that the action mentioned in it shall not be commenced until the accounting has taken place, while sections 414 and 382 have declared and provided for the time in which the accounting must be had in order to avoid the effect of the statutory limitations. The former are declaratory of the time within which the proceedings must be taken, if they are taken at all, and the latter has proceeded no further than to make the action dependent upon the fact of the accounting having been had. There was no disposition manifested in any of these provisions so to change the law, as it previously existed, as to render an administrator indefinitely liable to be called to an account. If a different construction is placed upon these sections, then an administrator has no protection unless it may be dependent upon the presumption of payment arising after the lapse of twenty years. And it has not been the purpose of the statutory provisions imposing limitations upon the times within which legal proceedings are to be taken, to leave this subject in this manner exempt from statutory provisions. No other section requires to be considered for the disposition of this appeal. These sections include this controversy, and as more than the statutory time had expired when this proceeding was instituted, the answer of the statute of limitation interposed a complete defense to the petition filed before the surrogate. And for these reasons, as well as those contained in the opinion of the presiding justice, the order should be reversed and an order entered sustaining the answer.

Brady, J.

(dissenting):

The learned surrogate seems to be right in his conclusion as to the effect of section 1819 of the Code upon applications of this chai’acter. Prior to the change made by that section, the period for commencing an action or special proceeding against an administrator for the cause assigned was the same. This is conceded.

The language of section 1819 does not include a special proceeding in hcee verba, but the course of legislation has been such as to indicate the design of having the action and special proceeding exist and go on pari passio together. This is shown by the opinion of the surrogate. There does not seem to be any reason why the proceeding shall be more restricted than the action. Under section 1819, the cause of action is deemed to accrue when the administrator’s account is judicially settled, and not before; and by the provisions of that section, after the expiration of one year from the granting of letters of administration, the person entitled to a legacy or distributive share may maintain against the administrator such an action as the case requires. It requires one of two proceedings, an action or a special proceeding before the surrogate, and, as to both, the time for commencing is intended to be the same.

I think the remedy sustained by the surrogate is, therefore, within the spirit, if not within the letter of the statute, and that the order appealed from should be affirmed, with ten dollars costs of the appeal and disbursements.

Order reversed, with ten dollars costs and disbursements.


source: Caselaw Access Project

author: Van Brunt, P. J.:

license: Public Domain

text:
    THE FARMERS’ LOAN AND TRUST COMPANY, Respondent, v. THE BANKERS AND MERCHANTS’ TELEGRAPH COMPANY and Others, Appellants.

      Mortgage — power of parties to provide for the manner in which the mortgaged premises shall he sold — as to property in this Stale — as to property in other States — this court cannot direct the sale of property in another State — construction 'of a provision giving to the mortgagee a right to elect that the principal shall become due on default of the mortgagor.

    On July 2, 1883, the Bankers and Merchants’ Telegraph Company of New York, the Bankers and Merchants’ Telegraph Company of New Jersey, the Bankers and Merchants’ Telegraph Company of Pennsylvania and the Bankers 'and Merchants’ Telegraph Company of Baltimore city made a mortgage to the plaintiff, whereby they mortgaged all their property, situate in several States, to secure bonds, to the amount of $300,000, issued by the said Bankers and ■ Merchants’ Telegraph Company. The bonds provided that in the event of non-payment of any interest coupons thereto attached, if such default should continue for six months after maturity and demand of payment, the principal of the bond should become due in the manner provided in the said mortgage.
    The mortgage provided that if default be made in the payment of any of the bonds or of any of the coupons, or in the payment of an annual installment of $10,000 of principal therein provided for, and such default should continue for six months, it should be lawful for the mortgagee, and upon the written request of one-third in interest of the owners and holders of said bonds it should be its duty, to enter upon the property mortgaged and sell and dispose of the same at public aution, having given notice once a week for six successive weeks by publication in two newspapers in the city of New York, one in Philadelphia and one in Baltimore, of the time and place of any such sale, and as the attorneys of the said corporations, by the said mortgage duly authorized, constituted and appointed, to execute to the purchasers thereof a good and sufficient deed of conveyance for the transfer of the real estate, and other good and sufficient conveyance of the mortgaged property sold, and out of the moneys arising out of such sale to pay the principal and interest due on the bonds, rendering the overplus, if any there were, to the said Bankers and Merchants’ Telegraph Company.
    It also authorized the trustee, in case of such default, to enter into and upon and take possession of all the offices and electric lines of the mortgagors, wheresoever situated, and their equipments and all the real and personal property described in the mortgage, for the benefit of the holders of said bonds, and retain and use the same until a sale should be made as therein provided . or as might be decreed by a court of competent jurisdiction and upon such sale to grant and convey the property so sold to the purchaser thereof, freed and discharged from all the trusts by said mortgage created, and without any liability as to application of purchase-money, and. that the recitals in any deed or conveyance of default, demand and refusal to pay, shall be as conclusive evidence as if the same had been duly, judicially declared and determined.
    It also contained the following clause: “It being expressly, understood and agreed that in the event of any such entry upon or taking possession of the telegraph lines, estates and property, real and personal, and premises hereby mortgaged, or agreed or intended so to be, or in the event of any sale thereof as hereinbefore mentioned, then, and in either such case, the whole principal sum of each and all of said bonds then outstanding and unpaid, and intended to be hereby secured, shall thereupon forthwith become due and payable, anything herein or therein contained to the contrary thereof notwithstanding; and it being further expressly understood and agreed that any law or usage to the contrary notwithstanding, that in case of default in the payment of either the principal or interest of the said bonds aforesaid, no sale of the telegraph lines, estates, property franchises and premises hereby mortgaged, or any of them, shall be had by reason of such default, otherwise than by and under the authority of the said trustee, for the time being, and in the manner hereinbefore provided.”
    The complaint in this action, brought to obtain a decree of foreclosure and a sale of the mortgaged premises alleged a default in payment of interest; that the plaintiff elected that the entire principal sum secured should immediately become due and payable; that the plaintiff had been impeded and hindered from taking possession of the property by the fact that the company had been embarrassed and receivers had been appointed by the courts of various States, and that it was impossible for it to execute its trust, in the way specified in the mortgage, without the aid of this court. The defendants admit the failure to pay, but. deny the right of the plaintiff to elect that the whole principal sum should become due, and further deny that the plaintiff has been impeded in its attempt to get possession of the property or that it is impossible for it to execute the trust without the aid of the court.
    Eelcl, that, conceding that in the case of the property, which was situated wholly within this State and was subject to the jurisdiction of its courts, that the parties could not by their agreement deprive the courts of the jurisdiction, which they would otherwise have, to enforce rights acquired under the mortgage, it was equally true that they could by agreement provide the method for the enforcement of their rights in these cases where the property mortgaged was situated out of this State and beyond the jurisdiction of its courts, unless contrary to some statutory regulation upon the subject.

      Elliott v. Wood (45 1ST. Y., 71) followed.
    That, as the statute of this State regulating the foreclosure of mortgages by advertisement relates solely to mortgages of property situated within this State, and as no evidence was offered to show that there was any statute relating to the foreclosure of mortgages in any of the other States in which the property covered by the mortgage in question was situated, tbe parties to the mortgage in question had at least the right, as to the property situated in the other States, to regulate by agreement the method of its sale. *

      That, .as this court could not by its decree or a sale made by an officer appointed by it, or by a conveyance executed by such officer, affect the title to property without the limits of the State, it erred in entering a decree directing a foreclosure sale, by a referee appointed therein, of all the property of the company situate without the limits of this State.
    'T-hat the court should not-direct a sale of the property situated within this State, •as it had found that the property should in no case be sold or disposed of ■except as an entirety, and as it.did not appear that it was impossible for the ■mortgagee 'to enforce its rights by a method not entailing such great disaster upon the security of the mortgage as would result from a separate sale of that portion of the mortgaged premises situated within this State.
    'That the bonds became immediately due and payable, only upon the happening of one of two contingencies, -viz , upon the trustees taking possession of the property, or upon a sale thereof; and that as neither of the events had happened the principal was not yet due.
    Appeal from a judgment of foreclosure and sale under a mortgage given to tbe plaintiff, as trustee.
    On the 2d day of July, 1883, the Bankers and Merchants’ Telegraph Company-of New York, the Bankers and Merchants’ Telegraph Company of New Jersey, the Bankers and Merchants’ Telegraph' Company of Pennsylvania, and the Bankers and Merchants’ Telegraph Company .of Baltimore City, made a mortgage to the Farmers’ Loan and Trust Company, as trustee, whereby they mortgaged all their property ¡situate in several States to secure an issue of $300,000 of bonds by the said Bankers and Merchants’ Telegraph Company, said bonds becoming due in 1913, the proceeds of which were to be used in the payment of the debts of the said corporation and in the extension of the telegraph lines, etc., of said company. The bonds provided that in the event of non-payment of any interest coupons thereto attached, if such default should continue for six months after maturity and demand of payment, the principal of the bond should become due in the manner provided in the said mortgage.
    The mortgage provided that if default was made in the payment of any of the bonds or any of the coupons which should become due thereon or should default be made in the payment of an annual installment of principal of ten thousand dollars provided for in said ■mortgage and such default should continue for the space of six ■months, it should be lawful for the said mortgagee, and upon the written request of one-third in interest of the owners and holders of said bonds it should be the duty of the said mortgagee, to enter upon the property mortgaged and sell and dispose of the same at public auction, having given notice once a week for six successive weeks, by publication in two newspapers in the city of New York, one in Philadelphia and one in Baltimore, of the time and place of any such sale, and as the attorneys of the said corporation, by the said mortgage duly authorized, constituted and appointed, to execute to the purchasers thereof a good and sufficient deed of conveyance for the transfer of the real estate, and other good and sufficient conveyance of the other mortgaged property sold, and out of the money arising out of such sale to pay the principal and interest which then should be due or grow due on the said several bonds and the expense of sale, returning the overplus, if any there should be, to 'the said Bankers and Merchants’ Telegraph Company.
    The mortgage then contains provisions for the payment of taxes and assessments, and further provides that in case of default in the payment of the said taxes and assessments, or of the principal and interest of the bonds intended to be secured by the mortgage, it shall be lawful for the said mortgagee, and it shall be its duty so to do, upon being required in writing by one-third in interest of the holders and owners of said bonds and to enter into and upon and take possession of all of the offices and electric lines of the mortgagors, wheresoever situated, and their equipments and all the real and personal property described in said mortgage, for the benefit of the holders of said bonds, and to retain and keep possession thereof and to use and operate the same until a sale thereof as hereinbefore provided, or as may be decreed by a court of competent jurisdiction, and that upon any sale being made by the mortgagee under • the mortgage it shall grant and convey the property so sold to the - purchaser thereof, freed and discharged from all the trusts by said mortgage created, and without any liability as to application of purchase money, and that the recitals, in any deed or conveyance, of default, demand and refusal to pay shall be as conclusive evidence as if the same had been duly judicially declared and determined, and that said mortgagee shall appropriate the purchase-money after deductions for expenses of sale, etc, first, to the payment of interest due in full, and second, to the payment of the principal of said bonds in full, if sufficient, but if not then to. pay -the same pro rata.

      The mortgage then contains the following clauses: “It being ■ expressly understood and agreed that in the event of any such entry upon or taking possession of the telegraph lines, estates and property, real and personal, and premises hereby mortgaged or agreed or intended so to be, or in the event of any sale thereof, as hereinbefore mentioned, then, and in either such case, the whole principal sum of each and all of said bonds then outstanding and unpaid, and intended to be hereby secured, shall thereupon forthwith become due and payable, anything herein or therein contained to the contrary thereof notwithstanding. And it being further expressly understood and agreed, any law or usage to the contrary notwithstanding, that in case of default in the payment of either the principal or interest of the said bonds aforesaid, no sale of the telegraph lines, estates, property, franchises and premises hereby mortgaged, or any of them, shall be had by reason of such default, otherwise than by and under the authority of the said trustee for the time being and in the manner hereinbefore provided.”
    Default having been made in the payment of interest due upon said bonds, and demand having been made therefor, and six months having elapsed, the plaintiff, the trustee named in said mortgage, commenced this action to foreclose the same.
    The complaint herein alleges, among other things, that because of the default in the payment of interest above mentioned for said six months, it elected that the entire principal sum secured by the said mortgage should immediately become due and payable, and that the same has, therefore, become due, and that the Telegraph company becoming embarrassed, and receivers having been appointed of its property by the courts of various States in which its property is situated, the plaintiff has, ever since the right to take possession of the mortgaged property matured, been impeded and hindered in taking possession of the premises and property covered by said mortgage, and that in consequence of the embarrassed condition of the affairs of the Telegraph company, and of the facts above mentioned, it is impossible for the plaintiff, as trustee under said mortgage, to execute its said trust in the way and manner specified and provided in and by the said mortgage without the aid of this court, and thereupon prays for a decree of foreclosure and sale of the mortgaged property.

      The defendants admit, in their answer a failure to pay interest, but deny that, under said mortgage, or pursuant to the terms of any other agreement, because of such failure the plaintiff had the right to elect that the whole principal sum should become due, or that it did become due because of such election, and deny that plaintiff has been hindered or impeded in taking possession of and selling the property, as alleged, or that it is impossible for the plaintiff to execute the trust in the way provided by the mortgage without the aid of the court. The answer further alleges that no part of the principal has become due, because no entry has been made as required by the mortgage.
    After a trial of the issues raised by the pleadings, a decree was entered, which, after reciting among other things, that the propertjr to foreclose which the action is brought extends over the State of New York and other States, and that it should in no case be sold or disposed of' except as an entirety, directs a foreclosure sale, of said property by a referee appointed therein, of all the property of the Telegraph company situate within the States of New York, New Jersey, Pennsylvania and Maryland, and the District of Columbia, and 'which decree adjudged that the purchaser of the property sold should be let into the possession and enjoyment thereof, and that every person in possession thereof should surrender such possession to the purchaser upon production of the referee’s deed, and that the purchaser should be fully vested with and hold and enjoy said property. From this decree this appeal is taken.

      Robert G. Ingersoll, for the appellants.

      Herbert B. Turner, for the respondent.
   Van Brunt, P. J.:

The grounds upon which the appellants base.their appeal seem to be as follows: First. That the plaintiff has mistaken its remedy in seeking a foreclosure by action, when the mortgage explicitly provides for a foreclosure by advertisement, and explicitly excludes every other method. Second. That the decree provides for fore, closure for both principal and interest, whereas the principal is not yet due.

Our attention has not been called to any case or text-book, nor have we been able to find any in which the questions involved in this controversy have been discussed or adjudicated. The rule is undoubtedly well established that the mere presence of a power of sale contained in a mortgage does not exclude other modes for foreclosure provided by law, but it is in addition to them. In the case at bar, however, the mortgage by its terms expressly prohibits any sale under the mortgage otherwise than by or wnder the authority of the trustee and in the manner therein provided, a provision which was not contained in any of the powers of sale as to which the rule above mentioned has been held to apply. In discussing this question it may be conceded that in the case of the mortgage of property which is situate wholly within this State and subject to the jurisdiction of its courts, that the parties cannot by their agreement deprive ■ the courts of the jurisdiction which they would otherwise have to enforce rights acquired under the mortgage, but it is equally true that they may by agreement provide the method for the enforcement of their rights in those cases where the property mortgaged is situate out of this State and beyond the jurisdiction of its courts unless contrary to some statutory regulation upon the subject. (Elliott v. Wood, 45 N. Y., 71, and cases cited.)

The statute of this State regulating the foreclosure of mortgages by advertisement, relates solely to mortgages of property situated within this State, and as no evidence is offered to show that there is any statute relating to foreclosure of mortgages in any of the other States in which property covered by the mortgage in question is situate, and as were it not for our statute regulating the foreclosure of mortgages the parties to a mortgage in this State might agree to any method of sale, even without notice, (Lawrence v. Farmers’ Loan and Trust Co., 13 N. Y., 200; Davey v. Durrant, 1 De Jex & Jones, 535) which might suit their purposes, the parties to the mortgage in question had at least the right as to the property situate in other States to regulate, by agreement, the method of its sale. It seems, also, equally clear that the courts of this State cannot by its decree, or by a sale made by an officer appointed by it, or by a conveyance executed by such officer, affect the title to property without the limits of the State (Elliott v. Wood, supra), and, therefore, by a sale under the decree entered in this action by tbe referee therein named, no title could possibly be conveyed to such of the mortgaged property as is situate in other States.

It is probably this fact that caused the insertion in the mortgage in question of the strong and apparently exclusive power of sale therein contained. It was known by the parties to the mortgage as it was found hy the learned court upon the trial of this action that the property mortgaged was situate in various States; that its value depended upon its being kept together and operated as one system and that it should not in any event be sold except as an entirety, and could not be otherwise sold without destroying, the value of the property.

The parties to the mortgage knew that no- title could be conveyed by a foreclosure in equity and a sale under a decree- of forceclosure in equity by an officer appointed under' such decree to- property situate in States other than the State-in which action was brought, and they therefore carefully provided that no sale should be made otherwise than by and under the authority of the grantee in the mortgage, who alone could cpnvey a title, by virtue of the- power contained in the mortgage, to property situate in other states, in order that the property might be sold as a whole and to the best advantage. This, certainly as’far as the property situate in other states is concerned, was a valid agreement, and the mortgagors and their successors have a right to demand its execution,.

The ‘plaintiff in its bill, seems to have anticipated that the defendants might have some rights, under the power' of sale provided -for in the mortgage, to insist upon the observance of its conditions, for it alleges the appointment of receivers in the various ■States, of the'property of the mortgagors situate therein, and the "possession by such receivers, of the mortgaged property, and that in ■consequence it has been hindered and impeded in taking possession of the mortgaged property'- as provided by the mortgage, "and in selling the same as in said mortgage required, and that it is ■impossible to execute the power of sale in the way and manner specified and provided in and by the mortgage.

These allegations in the complaint, except as to the appointment of receivers of the mortgagors’ property, are denied in the answer and no proof seems to have been offered to show that the plaintiff has made any effort whatever to take possession as required by the mortgage, and consequently the questions involved in this appeal must be disposed of as though there were no impediments in the way of the mortgagee taking possession of the property as required by the terms of the mortgage.

No purchaser at a sale under the decree in this action could ever be compelled to take title, because this court is powerless to enforce its own decree.

A purchaser at a foreclosure sale cannot be compelled to take title unless he can obtain j>ossession upon the production of his deed, and if the court cannot put him into possession he will not be compelled to take. Recognizing this rule, the decree appealed from provides that the purchaser of the property sold be let into the possession, use and enjoyment thereof, and that all persons in possession thereof deliver the same to such purchaser on the production of the referee’s deed or other proper evidence of the sale and purchase of said property. This provision of the decree the purchaser is entitled to have enforced, and how it can be made effective in respect to property in other States which it is admitted is in the possession of receivers appointed by the courts of those States, and over whom the courts of this State have not the slightest jurisdiction, has not been shown.

It would seem clear, therefore, that no sale can be had such as has been contemplated by this decree, and that the court should not decree any sale, as under such sale only the property in this State could be sold, which would almost destroy the value of the property mortgaged, it being possible, as far as appears from the evidence in the case, for the mortgagee to enforce his rights by a method not entailing such great disaster upon the security of the mortgage. It may be true that as far as the property in this State is concerned our statute regulates the method of foreclosure by advertisement, and the regulations therein provided must be complied with, but -they may be fulfilled as well as the provision of the mortgage 'in respect to the method of foreclosure and sale, and if this course is pursued a good and perfect title may be given by the mortgagee to the purchaser tipon a sale as to all the property mortgaged, whether situate in this State or in other States.

The.use of the words “sale thereof * * * as may be decreed by a court of competent jurisdiction ” in no way militates against the views above expressed, as we have attempted to show that there is no court which can decree and enforce a sale of all the property mortgaged, and that it was for that reason, probably, that the parties agreed upon the power of sale inserted in the mortgage.

In view of the conclusion to which we have arrived in respect to the propriety of the decree appealed from, it may not be necessary to consider the remaining question as to whether or not the principal of the bonds has become due, but it may be best to briefly consider the question. The provision of the bond is that “ In the event of non-payment of any interest coupons hereto attached, if such default shall continue for six months after maturity and demand of payment, the principal of this bond shall become due in the manner provided for in the said mortgage.”

The mortgage provides that upon the happening of certain events that the mortgagee may enter and take possession of the mortgaged property and sell the same, and that in the event of such taking possession, or in the event of any such sale, then, and in either such case, the whole principal sum of each and all the bonds then outstanding and unpaid shall thereupon forthwith become due and payable. The bonds became due, therefore, upon the contingencies, viz.: either upon the taking possession of the property by the trustees or by a sale thereof, neither of which having taken place, the conditions have not been fulfilled, and the principal therefore is not yet due.

The judgment appealed from must be reversed and a new trial ordered, with costs to the appellants to abide the event.

Brady and Daniels, JJt, concurred.

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


text:
    THE PEOPLE OF THE STATE OF NEW YORK ex rel. THE KNICKERBOCKER FIRE INSURANCE COMPANY, Appellants, v. MICHAEL COLEMAN and Others, as Commissioners of Taxes, etc., Respondents.

      Taxation of the capital stock of an insurance company — the tax commissioners are not limited by the price at which its shares sell in the open market — the value of the real estate as assessed and not its real value is to be deducted.

    In assessing the value of the capital stock of an insurance company for the purposes of taxation, the commissioners of taxes are not bound to adopt the rate at which the shares sold in the open market during the current year.

      People ex rel. Butchers, etc., Company v. Asten (100 FT. Y., 597) followed.
    In deducting the value of the real estate owned by the company, the value at which it was assessed for the purposes of taxation, and not the value at which the tax commissioners have valued it, in determining the value of the capital stock, should be used.

      People ex rel. Butchers, etc., Company v. Asten {supra) followed.
    Certiorari to review the action of the respondents in assessing the capital stock of the relator for the purposes of taxation.
    The relator is an insurance company and its shares of stock at par amounted to $210,000. The highest rate at which such shares sold in the open market during 1884 was ninety dollars per share but the respondent assessed the same as of the actual value of one hundred and forty-six dollars }ier share, for the purpose of taxation. This value was arrived at by valuing the gross assets at $374,872, including $125,000 as the value of the real estate, and making deductions amounting to $67,125.46, leaving the net value of the appellant’s assets or capital stock to be $307,747, or $146 per share of $100. From this amount the respondents deducted as required by law:
    U. S. stocks...................................... $186,840
    The assessed value of the real estate.................. 75,000
    Ten per cent on the capital......................... 21,000
    $282,840
    Leaving a balance of............................... $24,907
    for which amount the relator was assessed.

      Tbe relators sought to review this assessment by certiorari 'and it was confirmed by the court, and the relator duly appealed from such judgment of confirmation.

      8. B. Brownell, for relator, appellant.

      George 8. Coleman, for the respondent.
   Van Brunt, P. J.:

It is apparent that the only question which was presented to the court below was as to the right of the respondents to value, for the purposes of taxation, the capital stock of the relators at other than its market value. The case of the People ex rel. Butchers, etc., Company v. Asten (100 N. Y., 597), and cases there cited, seems to settle this question, and it is not open for discussion.

The capital stock of a corporation is to be assessed at its actual value the court say, and the commissioners of taxes act judiciously in fixing such value, and they have the authority to act in accordance with their own knowledge, and with such information as they are able to obtain from the sales in the market or otherwise, by ascertaining the value of 'the property which the stock represented, and by determining the dividend earning power of the corporation.

In the-case at bar it is true that the stock sold in the market at ninety, but, as above stated, the market value is only one of the elements to be considered by the commissioners in determining the “actual value of the capital stock” of a corporation for the purposes of taxation. There is no evidence that, in the valuation of the assets, the respondents placed excessive or unwarranted value upon any of the items going to make up the aggregate, nor is any complaint made upon that ground, but the only claim advanced is that the market value was ninety, and the commissioners could not assess at a higher value. This position, as has been seen, is not well taken.

It is now claimed, however, a point which does not appear to have been raised below, that the respondents, in appraising the assets of the corporation for the purpose of determining the actual value of capital stock, appraised the real estate at $125,000 (a valuation not claimed to be in excess of its actual value), but that in making the deductions for real estate only $75,000 was allowed, and that this was error.

The Court of Appeals, in the case of People ex rel. Butchers, etc., Company v. Asten (supra), seems to have disposed also of this objection. In the case cited, the real estate was valued for the purpose of ascertaining the actual value of the stock at what it cost, and being assessed only at one-lialf of such cost, such assessed value only was deducted as required by law. This, the court held, was not error, as the assessment of the real estate at one-half of what it actually cost did not not affect the value of the stock, and only the assessed value could be deducted. In the case at bar, it is not claimed that the real estate was not worth the $125,000 at which it was valued, nor that there was any excessive valuation of the assets; hence no error was committed by the respondents in their assessment, and the judgment appealed from should be affirmed, with costs.

Brady and Daniels, JJ., concurred.

Judgment affirmed, with costs.


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    ELBERT S. JEMISON and Others, Respondents, v. THE CITIZENS’ SAVINGS BANK OF JEFFERSON, TEXAS, Appellant.

      Corporations — agents of undisclosed principals — persons dealing with corporations are chargeable with notice of the purposes for which they a/re created — when a corporation is not estopped from disputing the validity of contracts made by its officers.

    In this action, brought by the plaintiffs, commission merchants and cotton brokers-to recover a balance of money, claimed to have been expended by them in the purchase and sale of cotton futures for the defendant, and for the plaintiffs’ commissions, it was shown that the defendant was incorporated under the name of Citizens’ Savings Bank of Jefferson, Texas, by an act of the legislature of the State of Texas. It was authorized to carry on the business usually carried on by savings banks in this State, and also to borrow money, buy and sell exchange, bullion, bank notes, government stocks or other securities. The purchases and sales were made by the plaintiffs under the direction of the cashier of the defendant, who informed the plaintiffs that neither himself nor the bank dealt in futures, and that in case he ordered purchases it would only be for good responsible customers who had put up the necessary margin.
    Aeld, that as the defendant did not disclose its principals at the time of giving the orders, it was not exonerated from responsibility merely because it stated that it was acting as an agent.

      That the plaintiffs were chargeable with notice of the purposes for which the corporation was formed, and that the question as to whether or not they had knowledge of the limitations imposed upon its powers was an immaterial one.
    That, as the corporation had no power to speculate in the manner in which it attempted to do, and as the plaintiffs were bound to know this fact, they could not recover the amount claimed.
    That, as the entire transaction resulted in a loss, and no properly was received by the defendant, the contract was not an executed one within the meaning of that term, as used in the decisions holding that in such cases a defendant corporation cannot claim that the contract was ultra vires.

      Whitney Arms Company^. Barlow (63 N. Y.-, 62); The Bider Life Baft Compamj v. Roach (97 id., 378); Parish v. Wheeler (22 id., 494) distinguished.
    Appeal by the defendant from a judgment entered against it on a trial by tlie court without a jury.
    TF D. G%tthrie, for the appellant.

      F. G. Barlow, for the respondents.
   Van Brunt, P. J.:

There is no dispute as to the facts which it is necessary to consider in the disposition of this appeal. The action was commenced to recover a balance of money claimed to have heen expended by the plaintiffs on the purchase and sale of cotton futures for the defendant and for the plaintiffs’ commissions. The plaintiffs, at the times of the transactions referred to, were copartners in business as commission merchants and cotton brokers. The defendant was a corporation created and existing by and under the laws of the State of Texas, and doing business at Jefferson, in that State, being chartered in the year 1871 by an act of the legislature of the State of Texas. The statute incorporating the defendant stated that the general business and object of the corporation should be to receive on deposit or in trust such sums of money as might from time to time be offered therefor by tradesmen, merchants, clerks, laborers, servants and others, to be repaid to such depositors when demanded, at such times, with such interest and under such regulations as the board of directors might from time to time prescribe. The statute further provided that the corporation might loan money according to the Constitution and laws of the State, and might discount in accordance with banking usages, taking • such security therefor, either real or personal, as the directors might deem sufficient; that the corporation should have power to borrow money, buy and sell exchange, bullion, bank notes, government stocks or other securities. But the corporation was not by its charter given the power to deal or speculate in cotton or other articles of merchandise or property. The plaintiffs had no knowledge of the powers of the corporation, or of the laws of Texas in regard to its powers, other than that which is implied from the title or name of the defendants. At the time of the transactions in question, J. PI. Parsons was the cashier of the defendant, and the by-laws provided that the board of directors should meet from time to time, as they should appoint, and provided in regard to the cashier that he should have general charge of the business of the bank, and the supervision of its concerns, and that he should have custody of the personal property of the bank and sign all checks and orders, drafts, bills of exchange and certificates of deposit. The transactions in question commenced in January, 1979, at which time Parsons, as cashier, wrote to the plaintiffs, asking what margin and commission they would ask in transactions for the purchase of cotton futures. The plaintiffs answered by letter of the 27th of January, 1879, stating amongst other things that the margin required was |250 per contract, and added: “ This will give you an idea how much to require from any of your friends who wish to make an investment.”

On the tenth of February, Parsons as cashier, gave the first order by telegraph and wrote on the same day that the order was made for one of their customers who had deposited $250 in accordance with their letter of January twenty-seventh. Other orders were given on the twenty-fourth of May, and on the same day Parsons wrote a letter to the plaintiffs in which he stated that neither himself nor the bank dealt in futures, and that in case he ordered other purchases it would only be for good responsible customers who had put the necessary margin up. Other correspondence was carried on between the parties and orders given, and the final result of the transactions was a loss to recover which this action is brought. In June and July, 1879, upon the ledger of the defendants appeared entries of an account between the plaintiffs and defendant, showing debits and credits to the plaintiffs growing out of dealings in futures. An account also appeared on the defendant’s ledger, with one Olopton, showing debits to said Clopton of losses on futures, and credits of profits, and deposits of margins. By an examination of said entries and accounts tbe directors could have ascertained that the bank was having dealings in some kind of futures. The defendant claims that it was not bound upon these contracts because they were ultra vires and against public policy and that it was acting simply as an agent and not as principal. As the defendant did not disclose its principals at the time of the giving of the orders, it is not exonerated from responsibility merely because it stated that it was acting as an agent.

From the finding of the learned judge, who tried the case, that the plaintiffs had no knowledge of the powers of the defendant corporation or of the laws of Texas, written or otherwise, in regard to its powers and functions other than that which is implied from the title or name of the defendant, it is claimed on the part of the plaintiffs that they were not bound by any of the limitations contained in the defendant’s charter, or any laws relating thereto existing in the State of Texas. It is to be inferred, however, from this finding that the knowledge as to the powers of the defendant corporation, which is implied from the title or name of -the defendant, the plaintiffs are chargeable with. The title or name of the defendant is the Citizens’ Savings Bank of Jefferson, Texas, and the knowledge of the powers of the defendant which the title or name of the defendant implies to citizens of this State is that the defendant had powers similar to those which savings banks in this State had aright to exercise.

The courts have declared in the case of Sistare v. Best (88 N. Y., 527), in respect to the powers of a savings bank, that the bank was a savings bank, and there can be no doubt that speculative contracts entered into for the sale of stock by the bank at the stock board, or elsewhere, subject to the hazard and contingencies of gain or loss, would be ultra vires and a gross perversion of the powers conferred by its charter.” Therefore, applying the rule that the implied knowledge of the plaintiff as to the powers of the defendant was such as the name or title of the defendant gave, they were bound to know from the very nature of its title that speculating in cotton futures by defendant was a gross perversion of the powers conferred by its charter, and that neither its cashier or its board of directors had any power to cause the bank to embark in any such enterprise. But it will appear upon an examination of tlie charter of the defendant, that its powers differed very materially from those of a savings bank as known under the laws of this State. It was a corporation having all the banking powers which belong to ordinary incorporated banks, with the exception that it had no power to issue notes for the purposes of a circulation medium, unless the same was done in conformity to the laws of the United States in such case made and provided. In the consideration of the question as to whether these contracts were ultra vires, it is necessary to treat it not as a savings bank only, but as an ordinary banking association or corporation.

The rule seems to be well established that parties dealing with corporations are chargeable with notice of the purposes for which the corporation was formed, and that every corporation necessarily qarries its charter where it goes, for that is the law of its existence. In Hoyt v. Thompson (19 N. Y., 208), in respect to corporations, the Court of Appeals say: “There is no doubt that all persons dealing with or deriving title from a foreign corporation, are bound to take notice of every limitation upon its powers contained in its charter.” In Alexander v. Cauldwell (83 N. Y., 480) the court say: “ Everyone knows that corporations are artificial creations existing by virtue of law, and organized for purposes defined in their charters; and he who deals with one of them is chargeable with notice of the purpose for which it was formed; and when he deals with agents or officers of one of them, he is bound to know their powers and the extent of their authority. Corporations, like natural persons, are bound only by the acts and contracts of their agents, done and made within the scope of their authority.” In Davis v. Old Colony Railroad Company (131 Mass., 258) it is said that every person who enters into a contract with a corporation is bound, at its peril, to take notice of the legal limit of its capacity.

In Relfe v. Rundle (103 N. Y., 222), it is said : “ Every corporation necessarily carries its charter wherever it goes, for that is the law of its existence. It may be restricted in the use of some of its powers while doing business away from its corporate home, but every person who deals with it everywhere is bound to take notice of the provisions which have been made in its charter for the management and control of its affairs both in life and after dissolution.”

In Angel and Ames on Corporations (§ 256), it is said that where a corporation is created for particular purposes with special powers, the contract does not bind it if it appears from the express provisions of the statute creating the corporation or by necessary and reasonable inference from its enactment that the contract is ultra vvres.

These authorities seem to show beyond question that it is entirely immaterial as to what the plaintiffs knew in reference to the limitations of the defendant’s powers. If the corporation had no power to speculate in the manner in which it attempted to do, with the plaintiffs, the plaintiffs were bound to know this fact, and they cannot plead them ignorance in support of a claim founded upon a contract which they were bound to know that the corporation had no power to make. ¥e have already seen that there is no dispute that if the plaintiffs were assumed to have had the knowledge conveyed by the title of the defendant that they must have known that the' defendant had no power or authority to enter into the speculative contracts which form the basis or subject of this action. Upon an examination of the charter we find no power conferred which authorized this bank to enter into the speculations which it is claimed it did with the plaintiffs: Their powers were defined to be, first, that of a savings bank; and secondly, the power to loan money, to borrow money, buy and sell exchange, bullion, bank notes, government stocks and other securities.

There is nothing in their charter which in any degree seems to authorize this bank to engage in speculative purchases of cotton merchandise or any other personal property, and as we have seen that the powers of corporations only extend to the purposes defined in their charter, and that he who deals with one of them is chargeable with notice of the purposes for which it has been formed ; when he enters into a contract with such corporation for a purpose manifestly foreign to its charter, he is bound to know that such contract is ultra vvres.

In the findings of fact, the learned justice has found that speculating in cotton or other articles of merchandise or property was not forbidden to said corporation either by its charter, by the constitution or by any statute of the State of Texas. "We have seen that such speculations were forbidden by the charter of the corporation because they were foreign to the purposes for which it was created. It is true that there was no evidence introduced in the case tending to show that such speculations were forbidden by the State of Texas. But this may be explained by the fact that under the objections of the plaintiffs evidence, tending to show that such speculation was forbidden by any statute of the State of Texas, was excluded. The objections were interposed upon the ground that the powers and privileges of the defendant bank were immaterial because the contracts in question were executed on the part of the plaintiffs. In view of this condition of the record, the plaintiffs in this action cannot recover unless the grounds stated in this objection are well founded.

It appeal's from the evidence that the transactions were entirely closed and resulted in a loss, and that this action was brought to recover the balance of such loss. And from these facts it is urged that the contract being an executed one the defendants cannot claim that it was ultra vires, or that its cashier had no power to make the same.

In considering this proposition it will not be necessary to pass upon the powers and authority of the cashier, because the difficulty with the plaintiffs case seems to be that neither the cashier nor the board of directors had any power to enter into any such contract, and the plaintiffs’ claim can only be sustained upon the ground that the contract, although ultra vires, was executed. In support of this proposition is cited the cases of the Whitney Arms Company v. Barlow (63 N. Y., 62); the Rider Life Raft Company v. Roach (97 N. Y., 378), and Parish v. Wheeler (22 N. Y., 494). The ground upon which the plaintiffs in this case claim that the contract is executed is that the plaintiffs have paid out money at the defendant’s request to the defendant’s creditors. It is to be observed that the plaintiffs, if acting for other persons, have nowhere disclosed who they were; and, therefore, applying, the rule which is urged against the defendant, that although the plaintiffs knew that the defendant was acting as agent, yet not having disclosed its principals, it became a principal itself, these transactions are to be considered as transactions between the plaintiffs and defendant, as principals, neither of them having disclosed for whom they were acting or pretending to act. The plaintiffs cannot claim, in one breath, that the defendant is a principal because the persons for whom it was acting were not disclosed, and then claim on behalf of themselves that they were acting for others, and hence are not to be treated as principals, they having failed to disclose for whom they are acting; under the facts disclosed, the plaintiffs were personally responsible to the defendant. There is no evidence, therefore, that the plaintiffs have paid out any money to any particular person at the request of the defendant. This they were bound to show under the general denial contained in the answer if they sought to reach the defendant because of money laid out and expended at its request. In the ease of the Whitney Arms Company v. Barlow (supra), the defendant had property which had been sold and delivered by the plaintiffs to the defendant, and the court held that the defendant could not keep the property without paying the purchase-price. The same state of affairs existed in the case of the Rider Company v. Roach, above referred to, and in Parish v. Wheeler it was held that though a corporation exceeded its legal powers in a purchase of personal property, the person who paid at its request the purchase-price of the property could maintain an action against the corporation, such corporation having possession of the property, and they could not defend on the ground that the purchase was ultra vires. In all of these cases the party seeking to be charged had possession of the property, which formed the basis of the action and such a defense could not be allowed as it would not advance justice, but on the contrary would accomplish a legal wrong.

In the case at bar the corporation has received nothing from the plaintiffs under the contracts in question, and hence occupies a very different position from those corporations in the cases cited, who were in actual possession of the property forming the consideration for the contract sued upon. In the case of The Rider Company v. Roach (supra) attention is called to the fact that some of the decisions hold that the plea of ultra vires can only be interposed by a corporation, and not by an individual dealing with such corporation. It is very doubtful whether that is the law in this State. In the case of Sistare v. Best (88 N. Y., 527) it is claimed by the respondents to be held that an agent is not to suffer for ultra vi/res acts when he does not know that they are ultra vires. Upon an examination of that case we fail to find any such proposition. The acts referred to in that case were expressly held to be within the powers of the corporation, arid a recovery was- sustained upon tha.t ground, and upon that ground alone. It would appear, therefore, that these contracts made between the plaintiffs and the defendant being beyond the authority of the corporation, and entirely foreign to the purposes of its incorporation, the losses sustained thereon cannot be recovered

The judgment must be reversed and a new trial ordered, with costs to appellants to abide event.

Beady and Daniels, JJ., concurred.

Judgment reversed, new trial ordered, with costs to appellant to abide event.


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    JOHN C. HENDERSON, Respondent, v. CHARLES R. HENDERSON, Individually and as Executor and Trustee Under the Will of JOHN C. HENDERSON, Deceased, and Others, Appellants.

      Action for partition — right to bring in persons claiming apoi'tion of the real estate under a devise alleged to be invalid —- Gode of Givil Procedure, sec. 1587 — General Buies of Practice, No. 65.
    This action was brought by the plaintiff, one of the heirs-at-law of John O. Henderson, to have a trust, attempted to be.created by the testator, declared void, and the heirs-at-law declared owners as tenants in common of the real estate left by the deceased. The complaint also alleged that the executor attempted to convey to the defendants Travers acertain portion of the said real estate, which conveyance was made without authority, and that the title to the said premises still remained in the heirs-at-law, and prayed for a judgment adjudging the said deed to be void and for a partition of the real estate amongst the heirs.

      Held, that a demurrer, interposed upon the ground that two different causes of action had been improperly joined therein, as both did not affect all the parties to the action, was properly overruled.
    That but one cause of action was set forth, viz., for the partition of the lands held in common by the heirs of John C. Henderson, deceased, and that, as an incident to this cause of action, the plaintiff had the right to remove the cloud upon the title of the heirs caused by the apparent devise contained in the will of the deceased, and that all persons claiming any portion of such real estate by virtue of such devise were necessary parties to such an action.

      Appeal from an interlocutory judgment, entered upon an order overruling a demurrer interposed to the complaint by the defendant Norman Henderson.
    The complaint alleges that John C. Henderson died leaving a last will and testament which was thereafter admitted to probate, and being seized and possessed of a large amount of real estate. That by his will, the deceased, after providing for the payment of certain legacies (the will being set out in full), attempted to create a trust in his executors which was void, and that the heirs-at-law of said Henderson are the owners and tenants in common of the real estate left by him. That the executor of the deceased attempted to convey to the defendants Travers a certain portion of said real estate, which conveyance was made without authority, and that the title to said premises attempted to be conveyed still remains in the heirs-at-law of said Henderson, and relief is demanded adjudging the said deed to be void and for a partition of the said real estate amongst the heirs-at-law of said testator.
    The defendant, Norman Henderson, one of the said heirs-at-law, demurs to the complaint upon the ground that causes of action have been therein improperly united, to wit, a cause of action for the partition of certain real estate, which cause of action does not affect the defendants Travers, and which does affect the other defendants, and a cause of action to set aside a transfer and deed of certain real estate mentioned in the complaint made by the executor of Henderson to said defendants Travers, which cause of action affects Plenderson, as executor, and defendants Travers, and upon the ground that the two above described causes of action which have been united in the said complaint do not affect all the parties to the action.
    The demurrer was overruled, and from the interlocutory judgment thereupon entered this appeal has been taken.

      Edward S. Ra/pallo, for the appellants.

      Francis Fortes, for the respondent.
   Van Brunt, P. J.:

It would seem that the learned counsel bases his demurrer upon the fact that the complaint demands relief not only declaring that the power of sale contained in the will be declared void and a partition be had, bnt also that the deed from the executor to the defendants Travers be also declared null and void.

It is admitted by the learned counsel for appellant that in a case in which a number of grantees each purchased separate parcels of real estate from an executor exercising a power of-sale, each grantee would be interested in his own deed, but that in case of an action brought against them all to set aside these conveyances of the various parcels upon the ground that the power of sale is void, all the grantees would be so affected as that all might be joined in one suit; but it is urged that if such an action included a cause of action for partition of all such real estate, and these grantees and the heirs-at-law were joined as defendants, that there would be a misjoinder of causes of actiou. The fallacy of this position seems to be in the assumption that there is of necessity any cause of action for the purpose of declaring the deed void.

The cause of action is for partition, and partition only. By section 1537 of the Code of Civil Procedure, such-an action may be brought by a person claiming to be entitled as a joint tenant oías a tenant in common, by reason of his being an heir of the person who died holding and in possession of real property, whether he is in or out of possession, notwithstanding an apparent devise thereof to another person by the decedent, and possession under such devise. Therefore in this action the plaintiff, one of the heirs-at-law of the decedent, has the right in this action to show, having made the necessary allegation, that the devise to the executor contained in the will of the decedent was void, and that he had no power of sale whatever, and that, therefore, the title to the real estate left by the decedent descended to his heirs-at-law, unaffected by such attempted devise. The defendants Travers claim under and by virtue of said devise, and are in possession thereunder, and hence are necessary parties to this adjudication, and it is no answer to say that because they do not claim the whole of the real estate that, therefore, they are not proper parties. It is not at all necessary to make any adjudication whatever as to the executor’s deed to Travers. If it is adjudged in an action to which the Travers are made parties as persons to be affected by the adjudication that the executor had no power of sale, their title falls with the devise. The plaintiff would have been irregular in his practice had he not included the lands attempted to be conveyed to the defendants Travers.

If the executor had no power of sale the title to the land attempted to be conveyed to the Travers descended to the heirs-at-law of decedent, and such heirs-at-law held the same as tenants in common in the same manner as they held the other lands left by the decedent, and rule 65 of the General Rules of Practice requires that all the lands owned by the same persons in common must be partitioned in one action. Hence the plaintiff was bound to include the land attempted to be conveyed to the Travers in his action of partition, as the heirs-at-law of' the decedent, if the executor had no power of sale, held the same as tenants in common.

There is, therefore, but one cause of action set forth in the plaintiff’s complaint, viz.: for the partition of the lands held as tenants in common by the heirs of John C. Henderson, deceased, and as an incident to this cause of action the plaintiff has the right to remove the cloud upon the title of the heirs caused by the apparent devise contained in the will of the deceased, and all persons claiming any portion of such real estate by virtue of such devise are necessary parties to such an action. None of the authorities cited establish any other or different proposition.

The judgment appealed from must be affirmed, with costs, the defendant to have leave to withdraw his demurrer and answer upon payment of costs of demurrer in court below, and the costs of this appeal.

Ready and Daniels, JJ., concurred.

Judgment affirmed, with costs, with leave to defendant to withdraw demurrer and answer on payment of costs of demurrer and of appeal.


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    In the Matter of the Probate of the Last Will and Testament of DENTON F. CONNER, Deceased.

      Devise or' bequest to charitable corporations — the provision in section 6 of chapter 319 of 1848, requirmg a wiU to be executed two months before the death of the testator was not altered or' repealed by chapter 641 of 1881.
    Chapter 641 oí 1881, increasing the amount of real and personal estate which all corporations, theretofore or thereafter formed under and in pursuance of chapter 319 of 1848, should be capable of taking, receiving, holding and purchasing, “subject, however, to the restrictions upon devises and bequests contained in an act entitled ‘An act relating to wills,’ passed April 13, 1860,” was not intended to change or alter that portion of section 6 of chapter 319 of 1848, which authorizes corporations formed under it to take, hold or receive any property, real or personal, by virtue of any devise or bequest, provided that “no such devise or bequest shall be valid in any will which shall not have been made and executed at least two months before the death of. the testator ”
    Appeal from a decree of tbe surrogate of tbe county of New York.
    Denton E. Connor, on" tbe 16th of January, 1886, made a will, and died on the twenty-third of January following. On the 23d of July, 1886, tbe said will was admitted to probate by tbe surrogate of tbe county of New York. By tbe said will tbe said Denton F. Conner bequeathed to his executor all bis estate, real and personal, in trust to take possession of all said real estate and sell and dispose of tbe same, and out of the proceeds to pay all just debts and funeral expenses and to pay all tbe rest residue and remainder thereof to Tbe Home for Incurables, a corporation created in tbe year 1886, under chapter 319 of tbe Laws of 1848 entitled “ An act for tbe incorporation of benevolent, charitable, scientific and missionary societies.” Some questions having arisen as to tbe validity of this bequest, a construction of tbe will by tbe surrogate was asked for and it was decided by him that under said will tbe real estate of tbe testator was converted into personalty, and that tbe gift to tbe Home for Incurables was void, tbe will not having been made two months before the testator’s death as required by section 6 of chapter 319 of the Laws of 1848 and that tbe next of kin of tbe testator were entitled to tbe personal property left by bim after paying all debts and expenses, and that tbe real estate left by him, or tbe proceeds thereof, should go and belong to the person or persons who would have been entitled to such property if the conversion thereof had not been directed by said will. From this adjudication this appeal is taken by the Home for Incurables.

      James 8. Sterns, for The Home for Incurables, appellant.

      W. U. Hamilton, guardian ad litem for certain infants, next of kin, and O. W. Pleasants, for certain other next of kin, respondents.
   Van Brunt, P. J.:

That by the will the real estate was to be deemed converted into personal estate at the death of the testator does not seem to admit of argument. The direction is explicit to the executors to convert into personal property, and the bequest to the Home for Incurables is of personal property, and as such the Home for Incurables must take it, and as such can only claim it. The conversion took place at the death of the testator irrespective of any action on the part of the executors.

As has been said, the corporation, The Home for Incurables, was incorporated under chapter 319 of the Laws of 1848. In 1878, by chapter 137, The Home for Incurables was authorized to take and hold real estate to the amount of $250,000. By chapter 641 of the Laws of 1881 it is provided that “ all corporations already formed, or which hereafter may be formed, under and in pursuance of chapter 319 of the Laws of 1848,* * * and the several acts amendatory thereof, * * * shall in law be capable of taking, receiving, purchasing and holding real estate, for the purposes of their corpo ' ration, to an amount not exceeding the sum of two hundred thousand dollars in value, and personal estate, for like purposes, to an amount not exceeding the sum of two hundred thousand dollars in value; but the clear annual income of such real and personal estate shall not exceed the sum of fifty thousand dollars, subject, however, to the restrictions upon devises and bequests contained in an act entitled £An act relating to wills, passed April 13, I860.5” It is claimed upon the part of the appellants that this law of 1881 repealed all restrictions upon devises to charitable corporations theretofore existing except those contained in the act of 1860 (chap. 360), and in the discussion of this question it seems to Lave been assumed by the counsel for both parties that this law of 1881 in some manner superseded or was amendatory of section 6 of chapter 319 of the Laws of 1848. An examination, however, of that chapter, and of the law of 1881, will show that the law of 1881 was not intended to be an amendment of and that it has no relation to section 6 of chapter 319 of the Laws of 1848. That section reads as follows: “Any corporation formed under this act shall be capable of taking, holding or receiving any property, real or personal, by virtue of any devise or bequest contained in any last will or testament of any person whomsoever, the clear annual income of which devise or bequest shall not exceed the sum of ten thousand dollars; provided no person leaving a wife or child or parent, shall devise or bequeath to such institution or corporation more than one-fourth of his or her estate after the payment of his or her debts, and such devise or bequest shall be valid to the extent of such one-fourth, and no such devise or bequest shall be valid in any will which shall not have been made and executed at least two months before the death of the testator.”

It is to be observed that the limitations in this section as to the corporation receiving and holding property, depend upon the manner in which the title is to be acquired. The provision is that the corporation shall not, by virtue of any devise or bequest contained in any will, be capable of taking any property where the clear annual income of the devise or bequest shall exceed the sum of $10,000. There is no limitation here upon the corporation taking property to any extent by gift. The only limitation is upon receiving or taking property by devise or bequest, and has no relation to the power of the corporation to take and receive, purchase and hold real estate for the purposes of its incorporation, received otherwise than by devise or bequest. Therefore, if there were nothing else in the act of 1848, it would not appear that the provisions of the act of 1881 have any relation whatever to those of the act of 1848. But when we come to see the provisions of section 2 of the latter act, it is very apparent that the act of 1881 has relation to the provisions of section 2 of the act of 1848, and to no other part of that act. Section 2 provides that, “ upon filing a certificate as aforesaid (provided in section 1), the persons who shall have signed and acknowledged such certificate, and their associates and successors, shall thereupon, by virtue of this act, be a body politic and corporate by the name stated in such certificate, and by that name they and their successors shall and may have succession and shall be persons in law capable of suing and being sued * * * and they and their successors by their corporate name” (and here follows language exactly similar to that contained in the act of 1881, with the exception of the amounts being different) “ shall in law be capable of taking, receiving, purchasing and holding real estate for the purposes of their incorporation and for no other purposes ” (the words “ and for no other purposes ” being left out of the act of 1881) “ to an amount not exceeding the sum of fifty thousand dollars ” ($200,000 being in the act of 1881) “and personal estate for like purposes to an amount not exceeding the sum of seventy-five thousand dollars” ($200,000 being in the act of 1881) “in value, but the clear annual income of such real and personal estate shall not exceed the sum of ten thousand dollars” ($50,000 being the amount named in the act of 1881). It is quite apparent, therefore, that the act of 1881 in no manner attempted to interfere with or amend section 6 of the act of 1848. It was simply an enlargement of the powers of the corporation, as limited by sectiou 2 of the act of 1848, and nothing more. As has been already stated, section 6 related to the power of the corporation to take by devise. Section 2 related to the power of the corporation to hold property, no matter how acquired, and- the laws of 1881 related precisely to the same subject.

It is now necessary to consider whether the addition of the words in the act of 1881, “subject, however, to the restrictions upon devises and bequests contained in an act entitled £ An act relating to wills,’ passed April 13, 1860,” ’ has made any change in the law as it existed at the time of the passage of the act of 1881. It has been held that by the passage of the act relating to wills passed April 13,1860 (chap. 360), the legislature increased the limit of charitable bequests from one-quarter to one-half, where the testator left a husband, wife, child or parent, but that the restriction contained in the last part of section 6, that no devise to a charitable corporation shall be valid in any will which shall not have been made “ and executed at least two months before the death of the testator, was not affected by the act of 1860. In constructing legislative enactments the intention of the legislature must govern, and repeals by implication are not to be favored. It is not necessary to cite authorities to sustain this proposition, and unless the provisions of the act of 1881 are inconsistent with the provisions of section 6 of the act of 1848, and. there is a plain intention on the part of the legislature to repeal the provisions of the act of 1848, such provisions still exist and are binding. The main argument upon the part of the appellant seems to have been based upon the fact that there was a declared intention upon the part of the legislature by the act of 1881, to alter, change, amend or appeal section 6 of the act of 1848 ; and the whole strength of his argument depends upon the existence of this fact. It has been seen by a comparison of the act of 1881 and the act of 1848, that there was no intention on the part of the legislature, by the act'of 1881, to interfere with that part of section 6, which it is argued was affected by the provisions of the act of 1881. The provisions of the act of 1881 no more repeals section 6 of the act of 1848 than does section 2 of that act; and as the provisions of the act of 1881 have been shown to be simply an amendment of section 2 of the act of 1848, there is no greater inconsistency between the existence of these sections as amended, than existed when they were originally enacted. There would seem, therefore, to have been no intention upon the part of the legislature, by the act of 1881, to interfere with the provisions of section 6 of the act of 1848.

It is true that the act of 1860 enlarged some of the provisions of section 6 of the act of 1848, but the balance of the section remained in full force and effect including the two months limitation. (Lefevre v. Lefevre, 59 N. Y., 434; Stephenson v. Short, 92 N. Y., 433.) The reference to the act of 1860, in the act of. 1881, was simply a declaration that the act of 1860 applied to corporations formed under the act of 1848, and that the act of 1881, increasing the corporative power to take and hold, should not be deemed in any way to have repealed the act of 1860, limiting in certain cases the amount of devises or bequests, and it does not seem to have been inserted for any other purposes. As the act of 1881 does not repeal the provisions of the said section 6 by direct enactment, it is difficult to see how a repeal by implication is to be sustained when such repeal runs counter to the whole policy of the law in reference to devises to corporations and said section 6 is in no way inconsistent with any of the provisions of the apt of 1881. It does not seem necessary to discuss this question further, as the whole foundation of the argument of the repeal by implication seems to rest upon the assumption that the law of 1881 showed an intent on the part of the legislature to change the provisions of section 6 in some respects at least, whereas it has been shown that it had no application whatever to that section but was intended to amend section 2. Adopting this view full effect is given to all the legislative enactments, and an intent to legislate upon a subject which is not at all germain to the matters legislated upon by the act of 1881, is not extorted from a very simple provision amending section 2 of the act of 1848.

The decree of the learned surrogate must, therefore, be affirmed, with costs.

Bradv and Daniels, J«L, concurred.

Decree affirmed, with costs.


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    ADOLPH STERNFELD and Others, Appellants, v. ALFRED L. SIMONSON, Respondent.

      Election of remedies — when an ineffectual attempt to secm'e his debt by legal proceedings in hostility to the assignment will not preclude a creditor from claiming benefits under a general assignment.

    One Robinson having made a general assignment of all his property to one Kopper for the benefit of his creditors, the plaintiffs instituted proceedings in which the assignor was compelled to appear and be examined and produce his books and papers before a referee, who reported that large quantities of goods purchased had not been accounted for, and that a bond for $7,500 should be given by the assignee, which was subsequently done, the defendant in this action being one of the obligors. Thereafter the plaintiffs began an action against Robinson upon notes made by him, and procured therein an attachment against his property, upon the ground that the assignment was fraudulent and invalid, but no levy was ever made thereunder. An execution, issued upon a judgment recovered in that action, having- been returned nulla bona, the plaintiffs brought an action against the assignee for an accounting, which resulted in a judgment in their favor, upon which an execution was issued and returned unsatisfied.

      In this action, brought by the plaintiffs against the defendant, one of the sureties upon the assignee’s bond, the complaint was dismissed upon the ground that the plaintiffs had made an election between two inconsistent remedies, and that they were confined to the one they had first chosen.

      Held, that it was error so to do.
    That, as there had never been any levy under the attachment issued by the plaintiffs and no property had been acquired thereby, and such proceedings were entirely futile, the plaintiffs were not deprived of their remedies under the assignment.

      Brown v. Littlefield (11 Wend., 467) followed.
    If the plaintiffs, by means of their attachment proceedings, had secured any of the property covered by the assignment, then a different question might be presented.
    Appeal from a judgment dismissing the complaint on the merits, after a trial by the court without a jury.
    In 1882 one George Robinson, an insolvent merchant of New York city, executed to Henry J. Kopper, as assignee, a general assignment- of all his property for the benefit of creditors. The assignee accepted the same, the assignment was recorded and the assignee executed and filed a bond and took possession of the assigned property. Afterwards a proceeding was instituted by the plaintiffs in this action, they alleging that the assignor had not turned over all his property to the assignee, in which proceeding it was referred to a referee to examine the assignor and assignee, the books and papers of the assignor and any witnesses produced before the referee, in respect to purchases made by the assignor during the year 1882, and as to what he had done with the goods, and if sold, as to what disposition he had made of the proceeds and as to whether he had turned over to the assignee the whole of his property, etc., and to ascertain the reasonable and just amount of the bond to be given by the assignee for the performance of his duties. The referee reported that large quantities of goods purchased had not been accounted for arid that a bond of $7,500 would be a reasonable and just amount to be given by the assignee; and subsequently a bond in that, amount was given in which the defendant was one of the obligors. On the 16th of October, 1882, the plaintiff began an action against Robinson upon notes made by him held by them, and on the second of November, upon an affidavit verified by the plaintiffs, an attachment was issued against Robinson’s property upon the ground that he had made said assignment to said Kopper with intent to hinder, delay and defraud his creditors. This attachment was immediately placed in the sheriff’s hands, but there is no evidence that any levy was made under it. Although there is a recital in the execution subsequently issued upon the judgment, as hereinafter stated, of such levy having been made, the evidence of the deputy sheriff fails to show that any such levy had actually been made. Judgment having been entered in this action, an execution was thereupon issued, and an indemnity bond was given to the sheriff, but the execution and attachment were returned nulla bona on the 27th of December, 1882. In June, 1884, an action for an accounting was begun by plaintiffs against the assignee, which resulted in a judgment in favor of the plaintiffs, against Kopper. An execution being issued upon that judgment and returned unsatisfied, this action was commenced against the defendant as one of the sureties upon the assignee’s bond.
    Upon the trial, the plaintiffs’ complaint was dismissed upon the merits on the ground that the plaintiffs had made an election between two inconsistent remedies and that they were confined to that which they first chose.
    From the judgment thereupon entered, this appeal is taken.'

      M. L. Townsend, for the appellants.

      B. F. Blair ^ for the respondent.
   Van Brunt, P. J.:

It is undoubtedly true that where there exists an election between two inconsistent remedies, the party is confined to the remedy which he first prefers and adopts, where the remedies are not concurrent and the choice between them is once made, the right to follow the other is gone forever. A long line of authorities has been cited by the counsel for the defendant in support of this proposition. The most of those authorities tend to establish the rule that where’ a party has sued for the purchase price of goods and recovered judgment, he cannot subsequently maintain an action upon the ground that the goods were obtained from him by fraud; or where the goods had been taken from the debtor by replevin or an action commenced for that purpose, the creditor cannot subsequently sue for the purchase price. But no authority has been cited that a mere ineffectual attempt upon the part of a creditor to secure his debt by legal proceedings precludes him from claiming tbe benefits as a creditor under an assignment. In fact, the case of Brown v. Littlefield (11 Wend., 467), cited by the defendants, clearly lays down the rule'to the contrary. It is said, at page 471, that where a party has inconsistent rights or remedies, he may claim or resort to one or the other at his election. He is frequently bound by some decisive act of' election in favor of one right or remedy, from afterwards claiming the other right or pursuing the other remedy, which is inconsistent therewith. But the mere attempt to pursue a remedy to which he is entitled, without obtaining any legal satis-' faction therefrom, will not deprive him of the benefit of that to which he had originally a right to resort, especially where he has acted under a mistake as to the facts. Applying this rule to the case at bar, it is clear that there never having been any levy under the attachment issued by the plaintiffs and no property acquired thereby, and such proceeding being entirely futile, the plaintiffs are not deprived of their remedies under the assignment. In fact, long before the issuing of the attachment, the plaintiffs had elected to proceed under the assignment, and their proceedings to examine the assignor and assignee in regard to the property, and in respect to the amount of the bond which it would be proper for the assignee to give in the Court of Common Pleas, might have been a complete answer to their proceeding by attachment, upon the ! allegation that the assignment was made with intent to hinder, delay and defraud the creditors, as they had elected to assert rights under the assignment itself, and after having made such election they could not attack it upon the ground of fraud.

In the foregoing statement it has been said that no levy was made under the attachment. It is true that the learned trial justices found that the sheriff had levied on the assigned property then in the possession of the assignee under and by virtue of ‘the plaintiffs attachment, but the case is entirely barren of any proof to sustain this finding. The evidence of the deputy fails to show any such levy and the evidence of the counsel for the plaintiffs shows that at the ■time of the issuing of the execution instructions were given not to levy and there was no proof that those instructions were withdrawn. The recital in the execution that such, a levy had been made, in view of the fact that the execution was returned nulla bona, was not sufficient in the face of this testimony to sustain the finding that a levy had actually been made. If the plaintiffs, by means of their attachment proceedings, had secured any of the property covered by the assignment, then a different question might be presented. But they having in no way interfered with the assigned property by their process, and having acquired nothing by those proceedings, and having obtained no legal satisfaction therefrom were not deprived of the benefit of the right to which they might originally have resorted. The case of Iselin v. Henlein, (16 Abb. N. C., 19) proceeds expressly upon the ground that an attaching creditor seized and obtained possession of the assigned estate under his attachment, and in Rodermund v. Clark (46 N. Y., 354), the decision is based upon the ground that the plaintiffs’ assignor having retained possession of the property, he and his assignees were precluded from maintaining an action for its conversion. It is not necessary to say anything in regard to any of the rights which the plaintiffs took by the assignment of Mary Robinson and Learys claim as they clearly obtained no greater rights than- had previously existed by virtue of their own position as creditors of the assignor.

"We are of opinion, therefore, that the plaintiffs were not precluded by anything that they had done from pursuing their remedies under the assignment as creditors of the assignor.

The judgment must be reversed and new trial ordered, with costs to appellant, to abide event.

Bjrady and Daniels, JJ"., concurred.

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