author: Andrews, Oh. J.

text:
    The Farmers’ Loan and Trust Company, as Committee, etc., App’lt, v. Henry Siefke, Resp’t.

      (Court of Appeals,

      Filed January 15, 1895.)

    1. Trial—Charge.
    In the absence of an exception to a portion of the charge, it must be assumed that the law was correctly stated on that point.
    2. Same.
    Where a general denial is interposed by the answer to the whole complaint, the plaintiff is bound to establish every material fact therein alleged ; and. though he gives evidence sufficient prima facie to establish it, and to require evidence on the part of the defendant to controvert it, the burden is not shifted; and, in such case, the jury may be properly instructed that such fact must be established by plaintiff by a preponderance of evidence.
    S. Deposition—Examination of party.
    The last clause of subd. 5, § 872 of the Code, was inserted to except a party to the action from the restriction in that subdivision, and a party, complying with the provisions of the other sections, is permitted to perpetuate his own testimony in the case by an examination before trial.
    Appeal from judgment of the general term of the court of common pleas in and for the city and county of New York, entered upon an order, which affirmed a judgment in favor of defendant entered upon a verdict, and also affirmed an order denying a motion for a new trial.

      David McOlure, for app’lt; Brainerd Tolies, for resp’t.
   Andrews, Oh. J.

The complaint alleged that the note sued upon was given for value, and was under the hand and seal of the •defendant. The answer contained a general denial of the allegations in the complaint, and in separate paragraphs, stated to constitute separate defenses, alleged that the note was without consideration, and that is was altered in material parts, and, among other things, by affixing a seal thereto without the consent or privity of the defendant. On the trial the note was offered in evidence by the plaintiff, and he then rested. The execution of the note by the defendant seems to have been admitted, as no proof was given upon the subject. It purported to be signed by him and a seal was attached to his signature. The defendant thereupon entered upon the defense. The question of consideration was litigated, and the defendant also gave proof tending to show that the seal was attached without his knowledge or consent by the plaintiff after the execution and delivery of the note. The evidence on the part of the defendant, as to the alteration by the addition of the seal, was met by evidence in behalf of the plaintiff that the seal was attached before execution. The case was submitted to the jury under a charge of the judge, and the jury rendered a general verdict for the defendant. Judgment was entered on the verdict, from which the plaintiff appealed to the general term, which affirmed the judgment, and this appeal is from the judgment of affirmance.

The allegations of error are founded mainly upon the charge to the jury. The judge charged in substance that if the seal was attached to the note by the plaintiff after execution and delivery, without the knowledge or consent of the defendant, it constituted a material alteration and the note was void. There was no exception to this part of the charge, and it must be taken on this point to have correctly stated the law. We are not to be understood, however, as dissenting from this view, but it is unnecessary now to consider it. The court further proceeded to charge that the plaintiff was bound to establish by a preponderance of evidence that the seal was not attached after the signature to the note. This was qualified afterwards by the statement that this burden rested upon the plaintiff after testimony had been given to show that the seal was attached after the inception of the note. The plaintiff’s counsel excepted to the charge as made and explained'.. This exception presents the principal question in the case. We think the charge was correct. Upon the pleadings, a general denial having been interposed by the answer to the whole complaint,, the plaintiff was bound to establish every material fact therein alleged. The primary issue was the execution or nonexecution by the defendant of a sealed instrument. The plaintiff alleged the making by the defendant of a specialty creating a pecuniary obligation, and issue having been taken on this allegation the plaintiff was bound to establish the obliagation by proof. If it had turned out on the trial that the allegation had been made by mistake- and that the instrument was not sealed, but was a simple contract only, orthat theseal had been attached after execution by a stranger without the privity or knowledge of the plaintiff, it would have been in the power of the court to have permitted an amendment of the pleadings upon such terms as it should deem just. But as the pleadings stood the question whether the defendant had executed a sealed instrument was an issuable fact, which was asserted on one side and denied on the other, and which the plaintiff was bound to establish as a part of his case. The defendant, under a general denial, may adduce evidence to controvert what the plaintiff is bound to prove in the first instance (Milbank v. Jones, 141 N.Y. 345; 57 St. Rep. 429, and cases cited), and the general rule is well established that whatever a plaintiff is bound to prove in the first instance as part of his case he is bound to establish by a preponderance of evidence. The burden of proof upon the issue of a material alteration of a written instrument, sued upon in its existing condition, presents no anomaly, but is governed by the general rule that the party alleging that the instrument sued upon is the act and deed of the defendant must establish it by proof. The case of Schwarz v. Oppold, 74 N. Y. 307, is a' precise authority for the proposition that under a general denial in an answer in a suit brought upon a written obligation, a material alteration may be proved. Under this authority we see no escape from the conclusion that evidence of alteration, which goes to the identity of the instrument, controverts a fact which a plaintiff is bound to prove in the first instance, that the instrument is the act of the defendant. There is confusion sometimes in treating of the burden of proof, arising out of unexact definitions. The burden is upon a plaintiff to establish his cause of action when it is in proper form denied by the other party. In actions upon a promissory note this burden is in the first instance discharged by giving evidence tending to show that the note was signed by the defendant. Proof of signing also identifies and proves the seal when the action is upon a sealed instrument. This prima facie establishes the cause of action. But a defendant is not concluded. He may give evidence, under a general denial, to show that the signature is a forgery, or that the note had been materially altered by the plaintiff without his consent, or many other things which might be mentioned, showing that the plaintiff never had a cause of action. It is very common to say in such cases that the burden is upon the defendant to establish the fact relied upon. All ’that this can properly mean is that when the plaintiff has established a prima facie case, the defendant is bound to controvert it by evidence, otherwise he will be cast in judgment. When such evidence is given, and the case upon the whole evidence, that for and that against the fact asserted by the plaintiff, is submitted to court or jury, then the question of the burden of proof as to any fact, in its proper sense, arises, and rests upon the party upon whom it was at the outset, and is not shifted by the course of the trial, and the jury may be properly instructed that all material issues tendered by the plaintiff must he established by him by a preponderance of evidence. See Davis v. Jenney, 1 Metc. 221; Simpson v. Davis, 119 Mass. 269; Perley v. Perley, 144 id. 104. The general rule of pleading, which also accords with reason, is, that defenses which assume or admit the original cause of action alleged, but are based upon subsequent facts or transactions which go to* qualify or defeat it, must be pleaded and proved by the defendant; and on the other hand the cause of action alleged by the plaintiff, and all its material incidents, must be asserted and proved by him, and in both cases the final event must be supported by a preponderance of evidence in favor of the party tendering the issue. This is illustrated in cases somewhat germane to the one before us. It is held by the weight of authority that the alteration of a bill or note need not be pleaded when the instrument is declared on in its altered state, but where the declaration is on the instrument in its original condition the alteration must be specifically pleaded. Hirschman v. Budd, (L. R) 8 Ex. 171; Byles on Bills (7th Am. ed.), 328. In the latter case the plaintiff sues on the actual contract made, and the defendant is seeking to defeat a recovery because it had been subsequently tampered with, and this defense must be pleaded and sustained by a preponderance of proof.

Tiie appellant, in support of his contention that the charge as to the burden of proof was erroneous, cites some cases in other states which, to some extent, sustain his view. But it seems to us they are opposed to sound principle, and at least cannot be followed in this state, in view of our decision in Schwarz v. Oppold. The remark quoted from the opinion in the case of Williamsburgh Savings Bank v. Town of Solon, 136 N. Y. 165; 49 St. Rep. 840, was. in a case where the supposed addition of the seal made the instrument what it was intended to be, both by the legislature and the town. The case, however, was decided wholly irrespective of the question of alteration, on the ground of a former adjudication. Our conclusion is that the charge was not erroneous in putting upon the plaintiff the burden of proof as to the existence of a seal when the note had its inception.

One other question only needs special reference, The plaintiff was not present on the trial, and his counsel early in the case introduced a witness to account for his absence, and the reason given was that he was partly paralyzed, and although mentally sound was not able to attend the trial. It seems that the fact that the plaintiff had not appeared as a witness was commented upon by counsel, and the court in the charge, referring to the subject, said: “It is true, of course, that his testimony might have been taken at his house.” This statement was subsequently excepted to, and it is claimed by the plaintiff’s counsel that it was prejudicial, because an examination of a party before trial on his own behalf could not be taken. This is a clear misapprehension of the Code provision (§ 872, subd. 5) as it now stands. The last clause in the subdivision was inserted to except a party to the action from the restriction in that subdivision. A party complying with the provisions in the other sections is permitted to perpetuate his own testimony in the case by an examination before trial.

We think the judgment is right and it should, therefore, be affirmed.

All concur, except Haight, J., not sitting.

Judgment affirmed.


source: Caselaw Access Project

author: Peckham, J.

license: Public Domain

text:
    The People, Resp’t, v. George R. Van Alstyne, App’lt.

      {Court of Appeals,

      Mled January 15, 1895.)

    Criminal law—Seduction—Promise oe marriage.
    A promise on the part of a man to marry a woman, who consents to sexual intercourse with him, in case she becomes pregnant as a result of such intercourse, is not sufficient to base thereon a conviction under § 284 of the Penal Code.
    Appeal from judgment of the general term of the supreme ■court in the fifth judicial department, entered upon an order, which affirmed a judgment of the court of sessions of Monroe ■county entered upon a verdict convicting defendant of the crime of seduction.
    The facts, so far as material, are stated in the opinion.

      II. B. Hallock, for app’lt; Howard II. Widener, for resp’t.

       Reversing, 61 St. Rep. 232.

   Peckham, J.

The defendant has been convicted of the crime of seduction under a promise of marriage. It is urged in his behalf that the evidence on the trial as given by the prosecutrix herself simply shows the making of a conditional promise by defendant to marry the prosecutrix only in case she became pregnant as a result of that intercourse. It is then insisted that if the promise were of that nature it was insufficient upon which to base a conviction under the statute We think the defendant’s counsel is right in the construction to be given the evidence in the case. On carefully reading the testimony of the prosecutrix we feel confident that the only promise which she proves on the part of defendant was the conditional one to marry her in case she became pregnant. She does state in one portion of her evidence an unconditional promise, but she immediately follows it by the statement of the conditional one, and we think it obvious from her whole evidence that the conditional is really the only promise which she regards as made or which can reasonably be inferred. The evidence which she gave before the justice in the other proceeding, and which in substance she admitted, and which was proved upon this trial, shows that she regarded the promise as one made only in case she became pregnant. Assuming the promise was of such a nature we are of the opinion that it was not of that kind contemplated by the statute. It was never intended to protect a woman who was willing to speculate upon -the results of her intercourse with a man and who only exacted as the price of her consent a promise on his part to marry her in case the intercourse resulted in her pregnancy. The conditional promise mentioned in Kenyon v. People, 26 N. Y. 203, is very different from the one here under discussion. It was an absolute promise to marry the prosecutrix if she would consent to have intercourse with him, and when she consented and the intercourse took place, the promise became mutual and the condition was performed. 'A promise on her part was implied from the fact that she yielded to the solicitations of the defendant, and, in consideration of his promise, the intercourse took place. The condition was performed the very moment that such intercourse was accomplished. It came within the very words of the statute and also within its purpose. The seduction was accomplished under and upon the faith of an unconditional promise to marry her. It was the consideration for and the inducement to such intercourse. In Boyce v. People, 55 N. Y. 644, the same kind of a conditional promise was proved and held to be sufficient, the court refusing to hold that there was anything in the evidence to justify the claim that the promise was to marry only in case the accused should be satisfied that the prosecutrix was a virgin. In Armstrong v. People, 70 N. Y. 38, at 53, the court says that the question is not raised by the evidence, and refuses to discuss it for that reason. The statute was passed to protect a confiding and chaste woman in yielding to the solicitations of the man who had promised to marry her. It was not the purpose of the law to throw its protection around the woman who was willing to consent to the act, and who only asked for a promise of marriage in case her lapse from chastity should be discovered by reason of her pregnancy. In such case she consents at a time when there is no real promise.

We think the case of People v. Duryea, 61 St. Rep. 131; 30 N. Y. Supp. 877, was well decided upon this very ground, and we approve the reasoning of Browh, J., therein contained.

The court below should have granted the motion of defendant, and should have discharged or directed the jury to acquit him on the ground that no sufficient promise of marriage was proved to constitute a criminal offense under § 284 of the Penal Code.

The judgment should be reversed, and, as there can be no conviction of defendant under the evidence as given by the prosecutrix, he should be discharged.

All concur, except Haight, J., not sitting.

Judgment reversed.


author: Finch, J.

text:
    Ida S. Harrison, Resp’t, v. Union Trust Company of New York, Impleaded, etc. App’lt.

      (Court of Appeals,

      Mled January 15, 1895.)

    1. Railroads—Mortgage.
    In an action by holders of bonds of a railroad corporation, secured by mortgage on the property, against the trustee named in said mortgage for the cancellation of the sales of such property under a foreclosure of such mortgage, for a re-sale under the foreclosure judgments, and for an accounting, etc., the fact that the bondholders had, in a former action, elected to disaffirm such sales and the acceptance by the trustee of the purchasers’ checks for the purchase price, ended the trustee’s liability upon the uncollected checks and, thus, rendered the action for an accounting nugatory.
    2. Same.
    An action to compel a Conveyance could not be sustained, as such relief had been awarded by the former judgment as amended, and a new decree, merely repeating an existing judgment, was superfluous.
    3. Same.
    The refusal of the trustee to comply with that judgment, as amended, made out a prima facie case for its removal, if such amendment is not absolutely void.
    4. Same.
    Though the trustee, who was made a party to the action, did not appear, the amendment to the judgment, requiring it to convey the property on the foreclosure suit, was not in violation of the provision of § 1207 of the Code, as the demand in the complaint for a foreclosure and sale carried with it a demand for all the details essential to make the sale effectual.
    5. Same.
    Though, in such case, the order granting the amendment might be voidable, it was not void, and disobedience thereto could not be justified.
    6. Same.
    The plaintiff had her choice of remedies, whether by motion or action, for the removal of the trustee.
    7. Same.
    The provision of § 1207 of the Code is simply a rule of procedure, intended for the protection of defendants not answering, and not a limitation upon the jurisdiction of the court.
    Appeal from judgment of the general term of the supreme court in the third judicial department, entered upon an order, which affirmed an interlocutory judgment in favor of plaintiff entered upon an order of the special term overruling a demurrer to the complaint.

      Wheeler H. Peclcham, for app’lt; Edward Winslow Paige, for resp’t.

      Affirming 62 St. Rep. 276.

   Finch, J.

This action appears to be supplemental to that of Stevens, etc., v. The Central Nat. Bank of Boston et al., the judgment in which we have recently affirmed. 144 N. Y. 50; 63 St. Rep. 625. The complaint before us recites the long history of the Lebanon Springs railroad, which is so fully stated in the case referred to as to render a formal repetition needless. We may go at once to the merits of the succeeding controversy, adding only such facts as have been hitherto unconsidered.

The demurrer interposed questions the sufficiency of the complaint, asserting that it states no cause of action, and from the decision below overruling that demurrer this appeal has been taken.

The complaint asks for three forms of relief, which are, the removal of the trustee, an accounting, and the execution of a conveyance to the purchaser on the last foreclosure. There is no case made for an accounting. The complaint does not allege that the Trust Company was ever in possession of the railroad or any part of it, or that it received any of its earnings or income, or that it ought to have done so and is chargeable therefor, or that it ever had a title, legal or equitable, to the road, or has any funds to which the bondholders are entitled. The facts detailed show that the Trust Company has always stood in the attitude merely of the mortgage trustee, foreclosing and selling when its trust duty required, never buying at any such sale, or taking possession under it, or operating or managing the railroad. The only money it is charged with receiving is the check of Duncan on the first New York sale and that of Park on the first Vermont sale, both of which checks it failed to collect and thereby became responsible for the purchase price of one hundred and twenty-five thousand dollars. But the bondholders who might have required a distribution among themselves of that sum, which would have been an affirmance of the sale, have chosen, as they had a right to do, to disaffirm the sale and require a re-sale of the property. That has occurred, and the bondholders in a new corporate capacity have become the purchasers. The result ends all liability of the Trust Company upon the uncollected checks, and no other money to which the plaintiffs are entitled is alleged to have come to the hands of such company, and no facts are pleaded which admit of any such inference. There is no cause of action for an accounting.

Nor can the action be sustained as one to compel a conveyance merely. The plaintiffs have already recovered one judgment which explicitly awards that relief, and a court does not sit to repeat over again the identical decree which it has already rendered and which simply needs .to be enforced. A foreclosure under the Lebanon Springs mortgage and under the Harlem Extension mortgage has ended in a sale. The intermediate Sackett suit and the new mortgages by purchasers have been sponged out, or the possible rights they created have been concentrated in Foster, who has conveyed to the final purcaser. The foreclosure action which worked this result was one in which the bondholders were plaintiffs. The Trust Company was joined as a party defendant. No relief was asked specially against it, and so it made no defense and interposed no answer. There was no apparent reason why it should. But thereafter, without notice to the Trust Company, the foreclosure judgment was amended by adding a direction which required that company to convey. After it was made, notice of the amendment was given to the Trust Company which did not move to strike it out or annul it, but chose to take no action. The complaint in this suit stands upon the validity of that amendment. It does not admit its invalidity and seek to cure the defect by a new action demanding a relief which had been ineffectually awarded. No such ground is taken. On the contrary, the plaintiff assumes the validity of the amendment and assails the Trust Company for disobedience of the command to convey. So that if there was nothing else about the case, we should hold that a new decree, merely repeating an existing judgment, was superfluous and- not a right which the plaintiff can lawfully claim.

But there is something else about the case. The plaintiff seeks the removal of the trustee upon the ground of its alleged misconduct both in accepting the unpaid checks and in refusing to make the required conveyance. As the plaintiff now relies upon that misconduct in accepting the checks to save the road to its bondholders instead of losing it for the one- hundred and twenty-five thousand dollars previously bid, the complaint must stand upon the disobedience alleged in the refusal of the Trust Company to convey. That refusal makes out a prima facie case for the removal of the trustee if the amendment xof’ the judgment is not absolutely void, for the court has undoubtedly the. power by way of enforcing its previous decree to remove the trustee who will not convey and appoint one who will. The ariswer made by the Trust Company is that the amendment is void and á nullity and that contention becomes the pivotal point of the controversy. The learned counsel for the defendant insists that since the Trust Company made default and did not answer,-no relief could be given beyond that asked in the complaint and refers us to the provision of the Code, (§ 1207), which enacts that “where there is no answer the judgment shall not be more fávorable to the plaintiff than that •demanded in the complaint.” I 'think the amendment cannot be said to violate that provision. The plaintiffs became entitled to a judgment of foreclosure and sale. They obtain that relief and that only. The incidents follow the principal and the demand for the foreclosure and sale carries with it a demand for all those details essential to-malle it effectual. If the judgment had omitted a direction that the referee convey an amendment curing the defect would not have been more favorable to th.e plaintiff than his general demand for a foreclosure and sale. And it should be added that the provision of the Code is simply a rule of procedure, intended for the protection of defendants not answering, and not a limitation upon the jurisdiction of the court. The case is notone in which the court had no authority at all to order a conveyance, but one where, having that jurisdiction, ‘it was required not to exercise it in a particular state of the litigation. The order was probably voidable, and no notice of the application for it having been given to the Trust Company such defendant might have moved to vacate and annul it. But it was void, and disobedience to it cannot now be justified on that ground.

It is suggested that an action solely for the removal of the trustee was needless because the relief could have been given on a mere motion, and that we ought not to encourage a formidable-action with its heavy expenses and prospective counsel fees where a simple motion, speedy and inexpensive, would have served. There is force in the suggestion. But the statute permits the removal of a trustee either by bill or petition, (2 R. S. [6th ed.] p. 1111, § 83), and the plaintiff here had her choice. We should hesitate to criticise motives not necessary to be disclosed to us, and can see that the choice of method was dictated by a belief that an accounting could be added to the relief, which might have been true, if sufficient facts to justify it had been pleaded.

It is further said that the alleged disobedience is immaterial because the Trust Company had no title to convey. Under the law of this state that appears to be true. The defendant corporation was never anything but mortgagee, and as such had a mere lien, and took no title to the land. In all the confused complications which have been recited to us I can see no place or way in which any title to the railroad, legal or equitable, passed into the defendant corporation, except one. It is said on the argument, though not alleged in the complaint, that under the law of Vermont the mortgagee holds the legal title to the land subject only to be defeated by payment; that the sale of the Vermont section of the Lebanon Springs road having been set aside the legal title remains in the Trust Company; that while the last foreclosure and sale in this state will not pass title in Vermont, a party to the action holding such title may be required to convey it. • We have asserted the right to make such an order as against a mortgagor, Union Trust Co. v. Olmstead, 102 N. Y. 729, and I can see no reason why we may not exercise the same authority as against a mortgagee. But all this is matter of defense as to which a decision should be reserved. It is enough to sustain the complaint against the demurrer that an order to convey, valid until reversed or vacated, has been made by a competent court which the defendant has refused to obey. It may have adequate reasons for the refusal. Possibly it may ask as a defense that the amendment be vacated and set aside, or assert that the demand of a conveyance was too broad and unlimited because, under a strict foreclosure in Vermont, title to the Bennington and Rutland railroad passed to it in trust for other parties and by a paramount right, or that no deed was tendered it for execution so that it could see what was required, or that no grantee of such deed was named, or that compensation for services rendered should be first made, or that there is a defect of parties who should be brought in, or assert any other reasons for its refusal. But all such are matters of defense about which we express no opinion. What we decide is, and all that we decide is, that a good cause of action for the removal of the trustee is pleaded in the complaint.

It follows that the judgment should be affirmed, with costs, but with leave to the defendant upon payment of costs of the demurrer to answer within twenty days after service of notice of the entry of judgment upon this affirmance.

All concur, except Peckham, J., not voting, and Haight, J., not sitting.

Judgment accordingly.


text:
    Martha E. Seymour, Resp’t, v. The Spring Forest Cemetery Association et al., App’lts.

      (Court of Appeals,

      Filed January 15, 1895.)

    1. Corporation—Directors—Personal dealings.
    Unless some special fund has been provided, or some special liquidation has been ordered, the director owes no duty to his company to buy in the outstanding bonds and may purchase for himself.
    2. Same.
    To make such purchase voidable at the election of the corporation, there must at least be some fact or circumstance which charges the trustee with a present duty to act for his company in respect to the bonds, which is or may be inconsistent with a personal purchase.
    8. Same.
    Even though such purchase was voidable at the election of the corporation, that election must be made promptly and upon sufficient knowledge of the facts.
    4. Same—Cemetery.
    Though the agreement for the purchase by the corporation preceded by a day or two the actual filing of the corporate certificate, the contract was ratified and any defect in its execution cured by the fact that the corporation accepted the deeds, took possession of the property, sold off lots, and for more than thirty years has kept the property and its proceeds.
    5. Same.
    The fact that some of the bonds devoted seventy-five per cent, of the net proceeds of sales made after the first two years to the payment thereof, did not invalidate the bonds.
    ■6. Same—Ratification.
    Where the corporation, subsequent to the purchase of the bonds, ratified the title of the vendees or their successors in interest, by making payments to them and providing for future payment, it cannot thereafter repudiate the purchase.
    Appeal from judgment of the general term of the supreme court in the fourth judicial department, entered upon an order, which affirmed an interlocutory judgment in favor of plaintiff entered upon the report of a referee.

      A. D. Wales, for app’lts; Edward K. Clark, for resp’t.
   Finch, J.

This appeal is from a final judgment rendered upon an" accounting which ascertained the amount payable upon bonds held by the plaintiff and issued by the defendant corporation. Necessarily the main questions involved are as to the legality of that issue and the right of the plaintiff to hold and enforce the obligations upon which she sues; and these questions arise out of a situation about which there is little, if any, dispute.

Eleven citizens of Binghamton became the owners of about thirty acres of land, which they bought for the purposes of a rural cemetery. Hotchkiss and Seymour, lawyers of standing and reputation in the city, owned an undivided tenth of the property, and each of the remaining nine of the associates a similar share. They entered at once upon the work of improving the land and preparing it for the intended use, and expended more or less of their own means upon it, looking forward to reimbursement and reasonable profit from the future sale of burial lots. As time passed it became apparent that some change of the situation was imperatively needed. That every sale of a lot should require the signature of each of the eleven and of their wives was a serious inconvenience, and one likely to be greatly.increased if any of the associates should die leaving infant children to inherit. Good sense and sound business policy dictated that the tenancy in common of the individuals should be transformed into the single title of a corporation, and that change was effected. The associates conveyed to the newly created corporation, of which they were the sole stockholders and in which they were the only persons interested. They fixed the consideration of the transfer at thirty thousand dollars, to be paid by the issue of corporate bonds to that amount, one-tenth of which was to be allotted to •each of the original shares. Twenty-one thousand dollars in amount of such bonds was issued, and the securities delivered to the proper owners, and those bonds are still outstanding. While the technical form of this transaction was a sale by the eleven to the corporation, its substance was merely a change in the manner of holding. The sellers were the buyers. They sold as individuals and bought as a corporation, and no one else had any interest in the question of price or terms of sale. If they were the vendors on the one hand, dealing with .themselves in a corporate capacity on the other, they were also the sole beneficiaries to be affected'and could not defraud themselves. The abstraction of the corporate entity should never be allowed to bar out and pervert the real' and obvious truth. As beneficiaries,, the stockholders necessarily assented to all the details of the arrangement, and no just criticism is possible either upon the legality or morality of the transaction. Evidence was given to show that the land conveyed was not worth the sum secured, but that is a totally immaterial fact. Whatever the price it wronged no one, and could wrong no one, •and accomplished nothing except to fix a primary limit to the anticipated profits. It was immaterial for another reason. The bonds were payable wholly out of the enterprise. First fifty per cent, and then seventy-five per cent, of the company's receipts from sales of lots was to be applied on the bonds, and they were payable from no other source. If the price nominally fixed had been three times as great, its real product would have remained the same, for either as bondholders or as stockholders the whole proceeds above expenses would become theirs and no more. It was the enterprise that was debtor, which could only pay by a liberal improvement and maintenance, and the actual price was the amount of its net surplus above expenditure, payable to the associates in the capacity of bondholders at least; a price to which they were fully entitled and which represented the profits they might" justly claim to reap. No doctrine as to the dealing of a fiduciary agent with the property of his principal has any application to such a transfer as was made.

There were some alleged technical irregularities in the issue of the bonds. These represented the purchase price of the land which the corporation bought and kept, and were its promise to pay which it could not justly repudiate. That kind of plunder ■which holds on to the property but ¡¡leads the doctrine of ultra vires against the obligation to pay for it, has no recognition or support in the law of this state. Whitney Arms Co. v. Barlow, 63 N. Y. 62; Duncomb v. N. Y., H. & N. R. R. Co., 84 id. 199; Woodruff v. Erie R. R. Co., 93 id. 619. That no formal resolution of purchase was produced from the minutes of the corporation does not prove that there was none, and if, in fact, there was none, because the agreement to that effect preceded by a day or two the actual filing of the corporate certificate, at least the corporation ratified the proposed contract, for it accepted the deeds, took possession of the property, has sold it in burial lots, has kept it and its proceeds for more than thirty years, and put utterly out of its power by its own acts any possible restoration. It must, therefore, pay or its possession becomes a robbery.

Some complaint is made of the form of the bonds. They devoted to the purpose of payment fifty per cent, of the corporate receipts, and some of them, at least, seventy-five per cent, after the first two years. The act of 1853 (chap. 122), allowing an appropriation of fifty per cent., relates only to the purchase of the land. It recognizes that the remainder may go to the expense of needed improvements fitting the property for its intended purposes. Here the purchase covered both the land itself and the improvements already put upon it fitting it for use as a cemetery. In 1860 (chap. 163) such associations were authorized to fund any debt for purchases of land, or the improvement and embellishment thereof, without restriction as to application of income, and, by the act of 1884 (chap. 433), all sealed certificates issued prior to 1860 were made as valid and effectual as if issued thereafter. The purpose seems to have been to cure any existing irregularity growing out of the prior provisions as to the application of proceeds. I do not think the restriction of fifty per cent, applied to these bonds, and, if it did, they have been sufficiently validated both by the act of 1884 and by the long continued recognition of the corporation.

There can be no reasonable doubt, therefore, that the bonds issued were valid corporate obligations in the hands of the original holders, who were at liberty to enforce them, and had full power and authority to transfer them. They were so transferred. The findings show that Hotchkiss and Seymour bought them all some time before 1873, and probably before the spring of 1871¡ and were the owners thereof at the death of Seymour, which occurred in January of the latter year. Whatever of - criticism there may be ,upon the proof of this fact, there was enough in the evidence to warrant the referee’s finding. Indeed the corporation itself, in a formal resolution passed in 1880, recognized that ownership and stated an account of moneys received by the holders applicable upon the bonds.

But the further claim is made that, because Hotchkiss and Seymour were officers of the corporation, holding a fiduciarj' relation as trustees or directors, they could not lawfully buy the valid and outstanding obligations of the company at less than par and enforce them for the full amount against the debtors. If that be sound doctrine, as is stoutly maintained, if directors cannot in any case invest in the bonds of their own companies except at the peril of a constructive fraud, if they cannot safely buy such bonds below par, because they deem them unduly depressed, if titles to corporate obligations passing through their hands became tainted by their touch, it is quite time that the courts should give, what they have not given, a very definite and distinct warning. Some citations of seeming authority are pressed upon us and others exist. The broad rule is stated in Perry on Trusts (§ 428), that “ a trustee, executor or assignee cannot buy up a debt or incumbrance to which the trust estate is liable for less than is actually due thereon, and make a profit to himself,” and that is the doctrine invoked in this case as applicable to a director regarded as a trustee of the corporation. But the statement, however correct in its application to specific instances, must be taken with the limitations which belong to it. Its foundation is that a fiduciary agent, owing a duty to his principal, cannot make a contract for his own benefit which is or may be inconsistent with that duty, and-the cases generally are of two kinds. The trustee buys in the property of his principal at a sacrifice for his own benefit, when, if he bought it at all, it was his duty to do it for his principal, or he makes a contract in behalf of his principal with himself, directly or indirectly, as the other party to the agreement. The first class of cases is illustrated by Slade v. Van Vechten, 11 Paige, 26, where the assignee bought in assigned property at a sheriff’s sale and claimed the personal benefit of his bargain ; and the second class by Munson v. S., G. & C. R. R. Co., 103 N. Y. 58; 3 St. Rep. 31, in which the directoi-s contracting had a private and personal interest, possibly adverse to their fiduciary duty. Almost, if not quite all, of the cases cited by the learned counsel for the appellant belong to one or the other of these two classes. But they do not decide this case, for Hotchkiss and Seymour neither bought in any property of the company nor dealt with the corporation in any respect. They made their contract, not with it, but with third persons capable of protecting their own rights, and bought nothing which the corporation owned or to which it had a right. We must go to still other cases, founded it may be to some extent upon similar ideas of fiduciary duty, to discover even an approximate authority: There are cases of co-partnership in which the general rules pertaining to that specific relation might prove to be broad enough to cover the purchase of the debt owing by the firm, Am. Bk. Note Co. v. Edson, 56 Barb, 89, and other cases in which the duties flowing from a liquidation conducted by the trustee, and as to which he owes a specific trust duty, forbid a purchase by the trustee for his own benefit at a discount. But in every class of cases the rule is founded upon the unwillingness of the law to uphold contracts which bring into collision the trust duty and the personal interest, and it is because of that collision, and the temptations which surround it, that it declares -the contract voidable at the election of the beneficiary without investigating the good or bad faith of the trustee. The entire basis of the rule consists in this collision between trust duty and personal interest, and the equitable prohibition has no application where there is no such possible inconsistency. There is no such conflict in the ordinary case of the purchase by a director in a going corporation of its outstanding obligations. There is no present duty resting upon him to extinguish them. The time for that has not come, the duty has not arisen, may never arise, the corporation is not prepared to pay, does not contemplate paying, but intends and expects to await the full maturity of the debt. Unless some special fund has been provided, or some special liquidation has been ordered, the director owes no duty to his company to discharge or buy in the outstanding bonds, and may purchase for himself because no inconsistent trust duty lias arisen. Why should he not ? While the bonds are running to their maturity, and the corporation is not able to extinguish them, is not bound to do so, does not even wish or seek to do so, what does it matter who holds the securities or on what terms they pass from hand to hand ? It seems to me that we are asked to crowd the rule almost to the verge of an absurdity, and to inflict a vital injury upon business interests by tainting with invalidity the holding by a director of the unmatured obligations of the corporation bought by him in the open market and not put in liquidation or sought to be extinguished. There must at least be some fact or circumstance which charges the trustee with a present duty to act for his company in respect to the bonds, which duty is or may be inconsistent with a personal purpose. Ho such duty rested upon Hotchkiss and Seymour, and they had a right to buy and hold for their own benefit.

Indeed, there is a further and equally conclusive answer. If the doctrine invoked applied to this case it would make the purchase not void but voidable at the election of the corporation, and that election must be made promptly and upon sufficient knowledge of the facts. The beneficiary cannot wait and speculate upon the chances of delay, but must act. Here the purchase was made before 1873, and in 1880 the corporation is found recognizing and ratifying the title of the vendees or their successors, making payments to them, and providing for future payments, and it is only after a delay of fifteen years that an attempt to repudiate the purchase is made. I know it is said that there were irregularities and omissions in the due election of trustees, and that such-had occurred is indicated bv the act of 1860 (chap. 323), which validates the acts of the trustees notwithstanding a failure to elect annually. But there was an election in 1879 at which lot owners voted, and nine trustees were elected. The criticism is that the administrator of Hotchkiss illegally voted at that election. However that may be, the person chosen became de facto trustees. Both Hotchkiss and Seymour were dead, and the new board contained no representatives of either. It was competent to act and must be presumed to have acted honestly in the performance of its duties. But in 1883 a board was elected without the votes represented by the bonds, and no action of any kind repudiating the bonds or-the settlement made was thereupon taken. It is too late now to question the titles of the trustees.

Another thing is said, however. We are asked to presume that Hotchkiss and Seymour bought these bonds with the funds of the corporation, and so they were paid and discharged. There is no basis for any such inference. On the contrary, the bonds of Doubleday were transferred in payment of legal services rendered by the transferees. Some of the Martin Stone bonds were assigned to Hotchkiss and Seymour by name, and there is just ground for believing that prior to 1871 the corporation had ho money not annually absorbed by the expenses of maintenance and improvement. For at least fifteen years no claim of the corporation adverse to the rightful ownership of Hotchkiss and Seymour appears to have been made, and now, when they and almost all the original associates are dead and cannot speak, no such presumption as is urged upon us can be indulged, especially since it requires us to presume conduct both dishonest and dishonorable.

Very much of argument has been expended upon the admissibility of the judgment in a prior action between the cemetery corporation as plaintiff and Mrs. Seymour' and her children as defendants. The case here does not rest or depend upon that judgment, but is sufficiently made without it. I think the judgment was competent evidence, but may be disregarded without at all changing the right of the plaintiff to the relief awarded by the interlocutory judgment. The record introduced, at least, conclusively shows that the corporation at no time since 1853 lost its corporate life by any errors or irregularities in the election of trustees.

The question of costs was not raised by any adequate objection and was in the discretion of the court.

The judgment should be affirmed, with costs.

All concur, except Haight, J., not sitting.

Judgment affirmed.


text:
    Sophia Frick Hillen, App’lt, v. Adrian Iselin et al., Resp't.

      (Court of Appeals,

      Filed January 15, 1895.)

    1. Will—Appointment.
    The fact that the testator, by a gift over in default of appointment, gave the property absolutely on the termination of the life estate, to the donee’s children or descendants, if any, or, in the alternative, to his other children or their decendants, does not indicate that the estates, authorized to be created under the power, were to be of the same absolute character.

      2. Same—Suspension.
    For the purpose of determining whether there has been an unlawful suspension of the estates created under a power, they are considered as having been created when the will or deed took effect.
    3. Same.
    It is no objection that the remainder was limited in favor of persons not in being when the limitation was created, provided that the contingency, upon which the final vesting depends, must happen, and the persons entitled to take are ascertained within the permitted period.

      4. Same—Appointment.
    A general and unlimited power of appointment, to be exercised in the future, is not void because under it the donee might, without departing from the express language, attempt to create an illegal estate.

      5. Same.
    The execution of a power will not he defeated because of some provision in excess of the power, which may be eliminated without disturbing the general schéme.
    Appeal from j udgment of the general term of the supreme court in the first judicial department, entered upon an order, which affirmed a judgment in favor'of defendant entered upon a decision of the court on trial at special term.
    This action was for the construction of the will of Columbus O’Donnell, in his lifetime a citizen and resident of Maryland, who died in 1873, leaving four children surviving him, including a daughter, Mrs. Emily Hillen, who died in 1888, leaving two children, Thomas Hillen and Emily McSherry, and to have an appointment made by Emily Hillen in her will, in attempted exercise of a power conferred upon her by the will of her father, Columbus O’Donnell, declared to be invalid, as not in conformity to this power.
    Both of the children of Emily Hillen were living at the death of Columbus O’Donnell, and also at her death in 1888. Her son, Thomas Hillen, died about a month after the death of his mother, leaving surviving him his widow, the plaintiff in this action, and an infant son, the defendant Thomas O’Donnell Hillen, who was living at the death of his grandmother, Emily Hillen. The defendants Adrian Iselin, Jr., and Richard M. McSherry are trustees under the appointment made by the will of Emily Hillen. The two former reside in the city of New York and have possession of the stock, bonds and securities which were transferred by the trustees and executors of the will of Columbus O’Donnell to them as trustees under the appointment in the will of Emily Hillen, and of the reinvestments made from time to time. Thomas Hillen, the son of Emily Hillen, who, as stated, died after the death of his mother, left a will, bequeathing and devising all his property to his wife, the plaintiff, without any appointment under the provisions of his mother’s will, he claiming that the power of appointment conferred on Emily Hillen by the will of Columbus O’Donnell was never validly exercised by her, and that in consequence he took an absolute title on the death of Emily Hillen to one-half of the four-twentieth parts of the estate of Columbus O’Donnell, given to Emily Hillen for life under the clause in his will providing for its disposition in default of an appointment by her. If the appointment was valid, the infant son of Thomas Hillen took the two-twentieths under the appointment in the will of Emily Hillen. The controversy, therefore, is between the mother, claiming under the will of her husband, Thomas Hillen, and the son, claiming under the appointment of his grandmother.
    Columbus O’Donnell, in “ item fifth ” of the sixteenth article of his will devised four-twentieths of his residuary estate to Charles Oliver O’Donnell (his son), Adrian Iselin, C. Morton Stewart and Elliott O’Donnell Poor, the survivors and survivor, the heirs, executors and administrators of the survivor and their successors in trust during the life of his daughter Emily Hillen, to pay the net income to her for her sole and separate use, and the will then proceeds as follows: “ And from and immediately after the death of my said daughter Emily, then the whole of the said last-mentioned four-twentieths parts or shares of the rest, residue and remainder of my estateo aforesaid, or the property, stock or funds of all' kinds in which the same may be invested at the time of my said daughter Emily’s decease is to continue in further trust, and to be held by the said trustees and their successors to and for such child or children of my said daughter Emily, or his, her or their descendant or descendants, and in such proportions and for such estate and estates therein, either in fee or for a less estate, • and with such limitations and conditions as my said daughter Emily may by her last will and testament, or by any instrument of writing in the nature of a last will and testament, notwithstanding any coverture she may be under, executed in the presence of three or more witnesses, name, limit, and appoint to take the same; and in case my said daughter Emily shall die without having executed under and in pursuance of the power above given to her, any such will or instrument of writing in the nature of a will limiting and appointing the said four-twentieth parts or shares in manner aforesaid, then in default of such limitation and appointment by my said daughter Emily it is my will and I so declare and direct that from and immediately after the decease of my said daughter Emily the said trustees and their successors shall continue to have and' to hold the said last mentioned four-twentieth parts or shares' of the said rest, residue and remainder of my estate as aforesaid, or the. property, stock or funds of all kinds in which the same may be invested at the time of my said daughter Emily’s decease, in trust for the uses and purposes following, that is to say: First, in case my said daughter Emily shall leave living at her death any child, or children or any descendant or descendants of any child or children of hers who may have died in her lifetime, then in trust for any and every such child or children of my said daughter Emily, and any and every such descendant and descendants of any child of hers living at her death, their heirs, executors, administrators and assigns, if but one to take the whole, if more than one to be equally divided between them per stirpes and not per capita, and such descendant or descendants of any child to take only the part or share to which such child would have been entitled if then living; secondly, in case my said daughter Emily shall not leave living at her death, any child nor any descendant of any child of hers, then and in that case the said trustees and their successors shall cantine to hold the' whole of the said last mentioned four-twentieth parts or shares of the said rest, residue and remainder of my estate as aforesaid, or the property, stock or funds of all kinds in which the same may be invested at the time of my said daughter Emily’s decease in trust for the following uses and purposes, that is to say : In trust to and for such of my other children or their descendants or descendant, and in such proportions and for such estate and estates therein, either in fee or for a less estate, and with such limitations and conditions as my said daughter Emily may by her last will and testament, or by any instrument- of writing in the nature of a last will and testament, notwithstanding any coveture she may be under, executed in the presence of three or more witnesses, name, direct, limit and appoint to take the same; and thirdly, in case my said daughter Emily shall die without having executed under and in pursuance of the power above given to her, any such will or instrument of writing in the nature of a will, limiting and appointing the said last-mentioned four-twentieth parts or shares in manner aforesaid, then in default of such limitation and appointment, by my said daughter Emily, and in the event also of her dying without leaving any child or any descendant of any child of hers. living at the time of her death as aforesaid, it is my will and I so-declare and direct, that from and immediately after the decease of my said daughter Emily, the said trustees and their successors-shall have and hold all the said last-mentioned four-twentieth parts or shares of all the said rest, residue and remainder of my estate as aforesaid, or the property, stock or funds of all kinds in which the same may be invested at the time of my said daughter Emily’s decease, to and for all my other children then living, and all the descendant or descendants then living of such of them as may be then dead, their heirs, executors, administrators and assigns, if but one to take all, if more than one to be equally divided between them per stirpes and not per capita."

    The appointment in the will of Mrs. Emily Hillen is in these-words:
    “3. I give all the rest of my estate of every kind, including herein all the estate over which I have a power of appointment under my father’s will, to Adrian Iselin, of the city of New York,, and Richard Fisher of the city of Baltimore, and the survivor of them, and the heirs, executors, administrators and assigns of such survivor, in trust to collect the rents, issues and profits thereof' and pay all necessary expenses thereout, including a commission of two and one-half per cent, to said trustees on the income, and to pay one-half part of the net income to my said son for and during the term of his natural life, and the other part to my daughter for and during the term of her natural life, without the power to my said son or daughter to contract any debt that may bind either the principal or the said income or to make any assignment thereof, or in any manner to draw upon or anticipate the same, and so that the same shall not be in any manner liable for his or her debts, contracts or engagements, and shall be paid to him or her alone, and as fast only as it shall be received, and so that the share of my daughter shall be free from the power or control of her husband for her sole use.
    ‘‘4. I empower my son as to his share, that is to say, one-half part of said rest of the estates, and also as to the other half part, also in case of the death of my daughter without leaving a child or descendant living at her death as hereinafter mentioned (and such power as to said other half may be exercised whether he survie her or not), to appoint the remainder to and for such one or more child, children, descendant and descendants of him, and in jsuch proportion and for such estate and estates therein, either in fee or for a less estate, and with such limitations and conditions as my said son, by his last will and testament, name, limit and appoint.
    “5. And upon default in the exercise of such power by my said son, I give at his death his share, that is to say, one-half part of said rest of the estates, and the other half part also, in case of the death of my said daughter without leaving a child or descendant living at her death as hereinafter mentioned, to all the children and descendants of my said son, per stirpes, who are living at his death, free from further trust'’
    The 5th codicil to Mrs. Emily Hillen’s will contains the following clause: “I revoke all the appointments in said will and the codicils thereto of both trustees and executors, and I appoint Adrian Iselin and Adrian Iselin, Junior, of the city of New York, and my son-in-law, Richard McSherry, trustees under my said---and codicils for the trust purposes severally mentioned in them, and I appoint said Adrian Iselin, Junior, and my son-in-law, Richard M. McSherry, and Edward Otis Hinkley, executors of my said will and codicils.”
    The trustees under Columbus O’Donnell’s will, who, at the time of the death of Mrs. Emily Hillen, were in possession of the estate, transferred the securites, in which much the larger part of Thomas Hillen’s moiety was invested, to the trustees appointed by Mrs. Emily Hillen’s will, who also were put in possession of the residue of the same moiety, consisting of property in Maryland.
    The object of the action was to obtain a decree oz’dering the trustee so in possession of the property to deliver it to the plaintiff, who claims it as executrix and legatee of Thomas Hillen.
    The appointment made by Mrs. Emily Hillen of her son’s share of the four-twentieths of the residuary estate of General O’Donnell, devised in the fifth “item” of the 16th article of his will, is claimed to be void on four several grounds : First. That children of a living child of Emily Hillen were not objects of the power created by her father, Columbus O’Donnell. Second. Because the will of Columbus O’Donnell contemplates and requires, that all estates created under the power should become vested immediately upon the death of Emily Hillen ; whereas by the terms-of her appointment the estate in remainder after the death of Thomas Hillen could not vest until his death. Third. That the attempted appointment was a departure from the power, in that it. gave the estate to trustees other than those named by the creator of the power, and upon trusts other than those authorized by him.. Fourth. That the limitation in the will of Emily Hillen was void under the rule against perpetuities.
    The special and general terms decided and held that the appointment made by Mrs. Hillen in her will was authorized by the power conferred by the will of Columbus O’Donnell, and that on the death of Thomas Hillen, in default of any appointment by him under his mothers’s will, the two-twentieth parts of the estate passed under the appointment of Mrs. Hillen to her grandson, Thomas O’Donnell Hillen.

      James 0. Carter and A. W. Machen, for app’lt; Joseph H. Choate, Richard M. McSherry and Wm. V. Rowe, for resp’t.

      Affirming, 51 St. Rep. 626.

   Andrews, Oh. J.

The validity of the appointment made by Emily Hillen depends upon the true construction of the power of appointment conferred upon her by the will of Columbus O'Donnell. The donee of a special power to appoint an estate given by deed or will, is invested with an authority merely, and unless the appointment conforms to the authority given, the appointment is invalid, iu so far, at least, as it transcends the power. The validity of an act in execution of a power is determined by the principles of agency. The appellant claims that the appointment made by the will of Emily Hillen was not authorized by the instrument creating the power. If this claim is well founded the situation in legal effect is the same as if no attempt to exercise the power had been made, and the estate to which it related passed upon her death to her children, Thomas and Emily, absolutely, by force of the alternative gift in the will of Columbus O’Donnell, to take effect in the event that the power of appointment given to his daughter should not be exercised. The primary question, therefore, in this ease requires a comparison between the power granted and the appointment made, and upon the result of such a comparison the case must turn. The cypres doctrine of the English courts, which has been applied to the construction of appointments of real estate under powers contained in wills (note to Alexander v. Alexander, Tad. L. C. on Real Prop. 409), does not prevail in this state, nor as is said, in Maryland, and cannot be resorted to to help out a defective execution of a power in a matter of substance.

The main ground of assault upon the validity of the appointment of the remainder by the will of Emily H.illen to the child or children of her son Thomas, is that such child or children were not at the death of his mother, descendant or descendants in a legal sense of their father, who was then living, and were not, therefore, objects of the power under the will of Columbus O’Donnell, which authorized an appointment to the “ child or children of my (his) daughter Emily, or his, her or their descendant or descendants.” The learned counsel for the appellant has shown that the word “ descendant,” according to its accurate lexicographical and legal meaning, designates the issue of a deceased person, and does not describe the child of a parent who is still living. The word is the correlative of ancestor. The word issue is a word of broader import and may include the children of a living parent as well as the children or descendants of one who is dead. But in an accurate sense one cannot have a living ancestor, nor can a living person, although he may have children, have descendants. But it was conceded, and it is an obvious truth, that a testator may not use a descriptive word in its literal signification, and that if in construing a will it appears from the context that he used a particular word in a boarder or different sense than would attach to it unexplained, that sense is to be attributed to it which was intended by the author of the instrument. In view of this principle the learned counsel further contended that there was nothing in the context of the will or in the circumstances surrounding the situation', which qualified or enlarged the strict meaning of the word “ descendant ” used by the creator of the power. The learned counsel for the respondents, while not controverting the proposition that the word descendant, in legal definition, means a child or children of a deceased person who was the stirps or stock of descent, nevertheless contended that the word as used by the testator, Columbus O’Donnell, in creating the power was intended to embrace all the persons in the line ■ of descent from any child or children of Emily Hillen; that is to say, as well the children living of a son or daughter of Emily, during the lifetime of the parent, as the issue of such son or daughter, the parent being dead. In support of this contention reference was made to the broad discretion reposed in Emily Hillen, the right of selection of the objects of appointment, and to exclude any child from the benefit of the power, and appoint the whole estate to one child to the exclusion of the other, or to the descendants of such child, the right to limit the estates to be created to a fee or a less estate in her discretion, implying a right to create successive estates for life or years, with remainders; and what was claimed to be more decisive still is the fact that the testator, in the clauses which dispose of the remainders in the shares given to his children for life, in default of appointment, used the words “ descendant or descendants ” in connection with express restrictive words, confining their application in terms to children or issue of deceased parents, and from this fact the inference is sought to be drawn that in the clauses creating the power of appointment he used the words in a larger and unconfined sense, because he there omitted the restrictive words, which he seemed to regard as necessary in order to confine their meaning in creating the devises over. The special and general terms sustained the appointment made by the will of Emily Hillen, upon the contention of the defendants that the words “ descendant or descendants,” in the clauses creating the power, were used in a wider sense than the strictly legal one, and that the testator in creating the power in question meant to include in one class Emily’s children living at her death, and all their children and their issue, whether such children were living or not, and to vest in the mother a discretion to select any one or more of this class, and to bestow the property on one or all, as she might determine.

We think the present judgment may be affirmed without passing upon this question, which is certainly not free from difficulty. Conceding the-claim of the appellant, that the words “ descendant or descendants” used in the clause of Columbus O’Donnell’s will creating the power of appointment in Emily Hillen were used in their primary sense, and. that the appointment to the issue of her son to be valid must have been made to issue of the son, who stood in the legal character of his descendants, nevertheless, the appointment of the remainder was in our judgment strictly within the terms of the power. The power was to appoint to the child or children of the son, or his “ descendant or descendants.” ■ The donee of the power appointed the estate to the son for life, and at his death, in default of appointment by him (which was never made), she appointed the remainder to his “children and descendants, per stirpes, who are living at his death.” The remainder was contingent. Purdy v. Hayt, 92 N. Y. 446. The persons entitled to take in remainder could not be ascertained until the death of the son. No estate vested in Thomas O’Donnell Hillen, the son of Thomas Hillen, on the death of bis grandmother. He might die before his father, and the remainder was to child or children living at his death. But the death of Thomas Hillen, the father, would at the same moment terminate his life estate and also ascertain the descendants entitled to the fee under the appointment. The gift of the remainder was by necessary construction a gift to the descendants of Thomas Hillen, because the remainder was dependent upon his estate for life, and no person except his descendants in their character as such could take it," and until his death no estate could vest in interest in any child or children of the life tenant. It would be a very unreasonable construction of the power that an appointment of a future estate could only be made to issue of the testator’s son or daughter, who should have-the character of descendants at the death of the donee of the power. She was given the fullest latitude in respect to the character and quality of the estates she might create, intermediate the vesting of the fee. It is plain that the grantor of the power-contemplated the probable creation of life estates and remainders. All he required was that the property should go to those of his blood, the children or descendants of his son, his daughter, her children, or one of them and their descendants, and this purpose was fulfilled by the appointment to the son of Emily Hillen and to his descendants upon his death. It seems to us plain that the appointment made by Emily Hillen was strictly within the power, giving to the words “descendant or descendants” their primary signification.

The claim that under the power the testator’s daughter Emily could create’only vested estates is not supported by any language in the clauses creating the power, nor, as we think, by any intention deducible from the language used, and seems to be inconsistent with the broad discretion conferred on the donee of the power to describe what estates her appointees should take. The fact that the testator, by the gift over in default of appointment, gave the property absolutely on the termination of the life estate to Emily’s children or descendants, if any, or, in the alternative, to his other children or their descendants, does not indicate that the estates authorized to be created under the power were to be of the same absolute character. If this was his intention he presumably would have so declared. But he confided to his daughter a discretion to be exercised in.view of events and circumstances which he could not know or foresee. It is undoubtedly true that the testator did not contemplate any lapse by which his estate or any part thereof would remain undisposed of. But even under his will there might be no effectual gift of the remainders in the event of Emily’s dying without having exercised the power of appointment. But this was a very improbable contingency, and equally so under the appointment made by Emily.

The further claim is made that the appointment under the will of Emily Hillen is invalid ,8s offending against the rule against perpetuities. It is well settled that the time of the suspension of the power of alienation, where appointments of future estates have been made under a power, which are claimed to be invalid for remoteness, is to be measured from the death of the testator, or, in the case of deeds, from the time of the conveyance. For the purpose of determining whether there has been an unlawful suspension of the estates created under a power, they are considered as having been created when the will or deed took place. The law of Maryland, following the English rule, allows a suspension during lives in being at the creation of the estate, and twenty-one years and a fraction beyond in case of minority. Testing the suspension in this case by this rule, the final vesting of the estate was not unlawfully postponed. There intervened between the death of the testator, Columbus O’Donnell, and the death of Thomas Hillen, the son of Emily, but two life estates, namely, an estate for life in Emily under her father’s will, and, second, a life estate in her son, Thomas Hillen, under her appointment, and both life tenants were living at the death of Columbus O’Donnell. Upon the death of the son the estate, under the appointment, was to vest absolutely in his descendants then living. These limitations were clearly authorized. It is no objection that the remainder was limited in favor of persons not in being when the limitation was created, provided that the contingency upon which the final vesting depends must happen, and the persons entitled to take be ascertained within the permitted period. Purdy v. Hayt, swpra. We have assumed that the title to the property was vested in the trustees during the continuance of the life estates, and was inalienable during their continuance. In this state trust estates are inalienable by force of statute, although there is nothing in the nature of such an estate which makes them inalienable ipso facto. Roberts v. Corning, 89 N. Y. 226. We are referred to the case of Thomas v. Gregg, 76 Md. 169, as an authority for the contention that there was in this case an unlawful suspension. The distinction is in the application of the rule that limitations are void which may unduly suspend the power of alienation, although it may turn out that by reason of the falling in of the contingencies within the prescribed period there may be no such suspension in fact. In Thomas v. Gregg a testator created a trust for the life of his daughter, with power to her to appoint to her children or grandchildren. The daughter appointed the estate in trust for the life of her “ children now living, or that may hereafter be born to me, ” and afterwards died, leaving three •children, two of whom were living at the death of the testator, and one of whom was born after his death. The court, applying the rule that a limitation under a power of appointment must be construed as if it were'inserted in the instrument creating the power, held that the appointment violated the rule of perpetuities,because it tied up the estate for the lives of persons not in being at the death of the testator, namely, the children then unborn of his daughter, and the court declared that the circumstance whether a child should be born or not after the testator’s death would make no difference in the construction of the limitation. It was sufficient, the court said, that a child might be born thereafter who would be entitled under the appointment. This case proceeds on an intelligible principle, that there might be under the will (construing the appointment a part of it) a possible suspension of the period of alienation beyond lives in being at the death of the testator. The principal to which we have adverted, that the validity of a limitation is to be tested by what is possible, and not by what in fact happens, has no application in reason to the construction of a power to limit estates couched in general terms, ■ without negative or restrictive words. It applies to estates actually limited under a will, deed or power, and a general and unlimited power of appointment to be exercised in the future is not void because under it the donee might, without departing from the express language, attempt to create an illegal estate. The power is in legal effect a power to do what is lawful and not what is unlawful. We think the estates under the power of appointment in this case were legally limited in point of duration.

The final objection is that the donee of the power nominated trustees of her own selection to hold the estate during the life of her son, thereby, as is said, disregarding the purpose of the testator, that the trustees named by him should hold the estate until the final vesting in fee. In fact, the trustees named by the daughter were, with one exception, the trustees under the will of her father. The answer of the general term to this point is, we think conclusive. If the appointment of new and different trustees were authorized, this departure from the power may be disregarded without affecting the beneficial interests of the appointee under the appointment. The case comes within the principle that the execution of a power will not be defeated because of some provision in excess of the power, which may be eliminated without disturbing the genefal scheme. See Alexander v. Alexander, 2 Ves. 644. Regarding the appointment of new trustees as unauthorized, and striking out the provision appointing them, then remains a complete and perfect execution of the power.

We think the judgment is correct, and should, therefore, be affirmed, with costs.

All concur, except Haight, J., not sitting.

Judgment affirmed. _


author: Andrews, Ch. J.

text:
    Angel K. Jorgensen, App’lt, v. Flavius S. Squires et al., Resp't.

      (Court of Appeals,

      Filed January 15, 1895.)

    1. Legislature—Powers—Sidewalks.
    The legislature may authorize a limited use of sidewalks in front of buildings in cities and villages for stoops, cellar openings or underground ■ vaults, for the more convenient and beneficial enjoyment of the adjacent premises.
    2. Municipal corporations—Sidewalks.
    The authorities of the city of New York have power to permit the construction of cellar ways extending under the sidewalk, under such reasonable regulations as they may prescribe.
    3. Same.
    Sections 201 and 202 of the Revised Ordinances imply permission to con struct cellarways within the limit of five feet, not in other respects transgressing the ordinances.
    Appeal from order of the general term of the supreme court in the first judicial department, which sustained defendants’ exceptions, set aside a verdict in favor of plaintiff and granted a new trial.

      M Countryman, for app’lt; Douglass A. Levien, Jr., and Robert A. Johnston, for resp’ts.

       Affirming 50 St. Rep. 161.

   Andrews, Ch. J.

The jury found on conflicting evidence that the plaintiff fell into a cellarway in front of the premises on Third avenue in the city of New York, owned by the corporation defendant and occupied by the other defendants as lessees. The cellarway was projected into the sidewalk a distance of five feet from the building line, and the opening was covered with wooden doors. The plaintiff testified that she was standing on these doors looking into a show’ window when they fell, and she fell with them into the opening below and was bruised and otherwise injured. The learned trial judge took from the jury the question whether the cellarway was improperly constructed, or improperly and carelessly maintained, and charged them that if the accident happened the defendants were liable, irrespective of negligence, for any in j uries sustained by the plaintiff, on the ground that the cellarway was an unlawful structure and a public nuisance, it having been constructed in the public street without authority, and he submitted to the jury two questions only: The question whether there was such an occurrence as that claimed by the plaintiff, and, second, the amount of damages. The plaintiff in her complaint, alleged that the defendants unlawfully maintained the cellarway, and that it extended more than five feet from the street line into the sidewalk, and was insecurely covered, and constituted a nuisance. The answer denied these allegations. The question whether the cellarway was an unlawful structure was litigated on the trial, the plaintiff maintaining that it was constructed without legislative or other authority, and the defendants insisting that it was built and maintained under the permission, express or implied, of the city authorities. There was no question raised upon the pleadings, and although the permission of the city to construct and maintain the cellarway was not pleaded as strictly as it should have been, regarding the action as an action for nuisance, Clifford v. Dam, 81 N. Y. 56, the parties having tried the case upon the assumption that the pleadings were sufficient, the objection that the authority of the city should have been affirmatively alleged in the answer cannot now be taken. If the trial court erred in charging the jury that the cellarway was an unlawful structure, the new trial was properly awarded and the order granting a new trial must be affirmed. We have arrived at the conclusion that the charge in this respect was erroneous, and this renders it unnecessary to consider the other grounds upon which the order for a new trial is sought to be supported. There can be no controversy as to the rule that an unauthorized obstruction or excavation in a public street, impairing its safety, constitutes a public nuisance and subjects the person or body creating or maintaining it to indictment and to liability in a civil action to any person sustaining special injury therefrom. The space occupied for sidewalks in city or village streets is as much a part of the street as the part used for horses and vehicles. The owner of a building abutting on a street may use the sidewalk in front of his premises as any other citizen, and, in addition, for the usual purposes of his business, although it may occasion temporary obstruction, provided he does not interfere unreasonably with the public right. There are many special and incidental uses of the sidewalk founded on vicinage and business necessity permitted to him by implication, beyond the bare right to pass and re-pass upon it. He may load and unload his goods in front of his store, subject to municipal regulation, and for this he needs no authority beyond that implied from common usage and the purposes for which streets are opened and dedicated, and many other similar privileges might be mentioned.

But an adjoining owner cannot, upon the plea of convenience or necessity, make an excavation in the street in front of his premises or construct a cellarway extending into the sidewalk, except by permission of a competent authority. The authority to construct vaults under sidewalks, or to make openings therein for a cellarway, or to enclose an area within the line of a street, is not an incident of ownership of the adjacent premises, or implied from such ownership, however convenient or even necessary the exercise of such an authority may be to their full enjoyment. The implication of such a right, as one annexed to the land and arising out of ownership merely, would or might lead to embarrassing conflicts and interfere with the control and regulations of the streets which in the interest of the public is reposed in public authorities. But it is competent for the legislature to authorize a limited use of sidewalks in front of buildings in cities and villages for stoops or cellar openings, or underground vaults, for the more convenient and beneficial enjoyment of the adjacent premises. While such uses may restrict somewhat the free and unembarrassed .use of the streets for pedestrians, the general interests are sub-served by making available to the greatest extent valuable property, increasing business facilities, giving encouragement to improvements and adding to taxable values.

' We do not understand that the ruling on the trial, that the cellarway in question was an unlawful structure, proceeded upon any denial of the power of the legislature, or of the municipality as representing it, in this matter, to authorize the construction of the cellarway in question. The assumption made and upon which the charge was based, was that in fact it had not been authorized by the city authorities. The cellarway had existed at the place in question for more than twenty years, and the defendant corporation, when the ground lease fell in 1889, purchased the building which had been erected by the tenant to which this cellarway was appurtenant, and leased the premises in their existing state to the other defendants. Such a long user without, so far as appears, any objection having been made to the cellarway by the authorities of the city, was evidence from which their consent to its construction might reasonably be inferred. Jennings v. Van Schaick, 108 N. Y. 530; 13 St. Rep. 686; Babbage v. Powers, 130 N. Y. 281; 41 St. Rep. 521; Chicago City v. Robbins, 2 Black, 418. It is a matter of observation that openings for cellarways extending into the sidewalk in cities or villages in front of business buildings are very common. They afford access to the basements of such buildings and render them much more valuable for business purposes. It would be an unnatural inference that, in the city of Hew York, where so many of such openings are found, they exist by sufference merely and were tolerated, but not permitted, by the public authorities. In the absence of affirmative proof of permission, it should be implied, if there is nothing to disprove it, either in the character of the structure or in the actual circumstances disclosed. It is unreasonable to suppose that a usage so general and unchallenged did not have its origin in municipal consent. We have said that it seemed to be assumed on the trial that the city authorities had power to permit the construction of cellarways extending into the sidewalk, under such reasonable regulations as they might prescribe. There can, we think, be no doubt of the existence of this power. The broad powers for purposes of municipal government possessed by the common council of the city of Hew York, derived from its ancient charters and modified and enlarged by subsequent statutes, include, to the fullest extent consistent with constitutional limitations, the power to control and regulate the public streets.

By § 86 of the consolidation act of 1882, the common council is invested with power to enact ordinances on a great variety of subjects, and, among others, by subd. 3, “ to regulate the use of sidewalks and prevent the extension of building fronts and house fronts within the stoop line.” This power was also given by the charter of 1873, and doubtless by still earlier legislation.

It is said that no ordinance has been enacted prescribing that the owner of a building may construct a cellarway extending to any distance into the sidewalk. It does not appear that there is any ordinance granting such power in express language. But such permission is implied in the ordinances Hos. 201 and 202. See vol. of Revised Ordinances. The first prohibits the construction of a cellar door “ which shall extend more than one-twelfth part of any street, or more than five feet into any street,” and § 202 prescribes that “ every entrance or flight of steps projecting beyond the line of the street and descending into any celler or basement story, * * * where such entrance or flight of steps shall not be covered, shall be inclosed with a railing,” etc. These prohibitions imply permission to construct cellarways within the limit of five feet, not in other respects transgressing the ordinances. The evidence is convincing and undisputed that the city officials, architects and owners have acted upon this 'construction of the ordinances. Ho express permits have been issued by the city for more than twenty years, and builders and architects regarded them as unnecessary where the proposed construction was within the limit and of the character specified. Sections 33 and 6é of the Eevised Ordinances relate to a different subject, and in no"respect qualify the terms of the ordinances, §§ 201 and 202, or the implications following from them. We are of the opinion that there was evidence tending to show that the construction of the cellarway in question was authorized by the city, and that the charge that it was an unlawful structure and a nuisance per se, was erroneous. The question whether it was carefully constructed or maintained is not presented.

If, as claimed since the argument, § 201 of the ordinance was not put in evidence, and should, therefore, be disregarded, it would not, we think, change the result.

The order of the general term reversing the judgment and directing a new trial was correct, and it should be affirmed and judgment absolute given'for the respondent on the stipulation.

All concur, except Haight, J., not sitting.

Ordered accordingly.


text:
    Emil Jung, App’lt, v. William Keuffel et al., Resp’ts.

      {Court of Appeals,

      Filed January 15, 1895.)

    Appeal—Verdict por nominal amount.
    The court of appeals cannot review the refusal of the courts below to set aside a verdict on the ground that, if the plaintiff was entitled to recover, he was entitled to more than a nominal amount, and upon such review grant a new trial.
    Appeal from judgment of the general term of the court of common pleas for the city and county of New York, entered upon an order, which affirmed a judgment in favor of defendants entered upon a verdict and also affirmed an order denying a motion for a new trial.

      Leopold Leo, for app’lt; Artemas B. Smith, for resp’ts.

       Affirming, 52 St. Rep. 938.

   Peckham, J.

This action was brought to recover damages from defendants by reason of their negligence, resulting in the loss of three fingers on the plaintiff’s left hand. The trial insulted in a verdict of six cents for the plaintiff. There is not an exception in the case, either to the evidence or to the charge of the judge.

The plaintiff made a motion for a new trial upon the judge’s minutes and contended that the verdict was improper, as only partially deciding the case; that if the plaintiff were entitled to recover at all it was more than a nominal amount, and hence, the verdict ought not to stand. The motion was denied and judgmeut was ordered to be entered upon the verdict, which was so done, and the plaintiff appealed from both judgment and order to the general term.

The court affirmed both the judgment and order, and judgment to that effect was thereupon entered, and from that judgment the plaintiff has appealed here.

We have many times held that we can review in this court nothing but exceptions taken in the course of the trial. Standard Oil Co. v. Amazon Ins. Co., 79 N. Y. 506; Duryea v. Vosburgh, 121 id. 57; 30 St. Rep. 683; Wicks v. Thompson, 129 N. Y. 634; 41 St. Rep. 510; Baldwin's Bank, etc., v. Butler, 133 N. Y. 564; 44 St. Rep. 75, and numerous other cases.

In the cases cited by the plaintiff the courts below had set aside verdicts and granted new trials, and appeals were taken from those orders to this court. The appeals were based upon the claim that the courts below had no legal right to set the verdicts aside upon the grounds stated. We held they had, and, therefore, affirmed the orders appealed from. That is a very different thing from assuming to review the refusal of the courts below to set aside a verdict on the ground stated and upon such review to grant a new trial. To assume this right would be to turn this court out of its sphere as a court to review errors of law only, founded upon exceptions, and to engraft upon its jurisdiction the power of the general term of the supreme court in such cases. This cannot be done. The case cited by plaintiff, Wheeler v. Sweet, 137 N. Y. 435; 51 St. Rep. 77, is outside the general rule in regard to reviewing exceptions only, but it is in the strict line of the jurisdiction of this court in reviewing only errors of law committed by the court below in the course of the trial.

The error consisted of an erroneous charge to the jury upon their return into court for further instructions, and in the absence of counsel, so that exceptions could not be taken. The motion for a new trial was made on a case and exceptions in which the proceeding was set out in full, and we held that as' the error of law appeared in the record and arose in the course of the trial, and the plaintiff had no opportunity to take a formal exception, we would on appeal review the error as if an exception had been interposed. The reasons for the decision are stated in the opinion of Andrews, Ch. J., and do not in any way interfere with the rule we have followed so long.

In this case there was no error of law committed by the courts below in refusing to set aside the verdict on the ground claimed by the plaintiff. It was a complete verdict, although' we may think greatly inadequate if the plaintiff were entitled to anything.

It was a matter addressed to the discretion of the courts below, and we cannot interfere with its exercise in this instance, although we might, sitting in the court below, have come to an entirely different conclusion and have at once set the verdict aside.

The judgment should be affirmed, and the appeal taken from the order should be dismissed and the defendant granted one bill of costs only as upon an appeal from a judgment.

All concur, except Haight, J., not sitting.

Judgment accordingly.