author: Andrews, J

text:
    Artemas H. Holmes et al., App’lts, v. George S. Evans et al., Resp’ts.

      (Court of Appeals,

      Filed December 1, 1891.)

    Attorneys—Compensation for services.
    Plaintiffs, a firm of attorneys, were employed by defendants to litigate or make settlement of certain claims, they to receive a specified percentage of “such recovery or settlement in kind” with the right for defendants “within sixty days to substitute a reasonable cash fee,” the balance, after deducting plaintiffs’ portion, to be divided between defendants. A settlement made by them not being satisfactory, plaintiffs gave a consent to substitution, stating that if a settlement was made on substantially the terms rejected, they should be entitled to their commission. IKd/that a performance of the services was in effect a condition, and non-perform-once by plaintiffs would defeat their equitable right, and their abandonment of the case forfeited their rights -under their agreement.

      Appeal from judgment of the New York superior courts general term, affirming judgment for defendants, entered* upon report of referee.

      William B. Hornblower, for app’lts: John C. Tomlinson, for resp’ts.

       Affirming 36 St. Rep., 933; see also 37 id., 369.

   Andrews, J

There is authority tending to support the claim that by force of the agreement of March 24,1890, there was an equitable assignment by the defendants to the plaintiffs of an interest, to the extent specified in the agreement, of the claim of the defendants against Lippincott. Fairbanks v. Sargent, 104 N. Y., 108; 5 St. Rep., 531; Williams v. Ingersoll, 89 N. Y., 508.

An equitable assignment has been defined to be such an assignment as gives the assignee a title which, although not cognizable at law, equity will recognize and protect. Such an assignment passes an immediate equitable interest in the subject, although it. is not essential to the creation of the interest that it should be immediately enforceable by suit for specific performance to recover the interest assigned. Whether in a given case the transaction amounts to an equitable assignment depends to a great extent upon the intention. Where the transaction is evidenced by a written agreement, it depends upon the intention of the parties as-manifested in the writing, construed in the light of such extrinsic circumstances as under the general rules of law are admissible in aid of the interpretation of written instruments.

It has been said that “ to make an equitable assignment there must be such an appropriation of the subject matter as to confer a complete and present right upon the party intended to be provided for, even where the circumstances do not admit of its immediate exercise.” Swayne J., Christmas v. Russell, 14 Wall., 69.

There must undoubtedly be a purpose to pass a present interest, but that interest may be absolute or qualified, a right to the immediate possession and enjoyment or a right to such enjoyment, postponed until the occurrence of some future event. In other words, the assignment may be made subject to limitations, conditions and qualifications, such as might be inserted in the conveyance or assignment of the legal estate in the same subject. The quality of the equitable estate is that and that only which the parties intended.

The language of the agreement of March 24, 1890, is consistent, with an intention on the part of the defendants to give the plaintiffs an equitable interest in the subject of the litigation, and the circumstances confirm that construction. The case was complicated and, perhaps, doubtful. The defendants had no means to carry on the proposed litigation, and the plaintiffs could not. reasonably have expected to receive compensation for their services and disbursements except through the fund or property which might be recovered in the action. They, therefore, on their part agreed to conduct proceedings and suits, “ and so far as lies in their power to carry said proceedings and suits to a successful and final issue a.nd recovery,” and the defendants agreed that the plaintiffs “ shall receive upon settlement or recovery of said claims ” (against Lippincott) a specified percentage of such recovery or settlement in kind,” the defendants reserving the right “ within sixty days to substitute a reasonable cash fee ” for the services of the plaintiffs in the place of such proportionate part of the claims recovered or settled for as before provided. The final clause of the agreement provides for a division by the plaintiffs between the two defendants of all stock, cash and property settled for or recovered after the plaintiffs shall have set aside their portion under the agreement, and it is stated that the allowance to the plaintiffs shall cover all disbursements. This was not an ■agreement to pay the plaintiffs out of the fund to be recovered. It was an agreement in effect that they should have a share in the claims, and that when realized the fund should be divided between the parties in the proportions indicated. The right reserved to the defendants to substitute a cash compensation for the compensation in kind, does not, we think, characterize the agreement as executory only, or prevent its operating as an equitable assignment If the right should be exercised, it would divest the equitable title of the plaintiffs in any part of the claim and operate as a defeasance. But the concession that the plaintiffs were equitable assignees under the agreement by no means establishes their right to a specific performance.

The consideration of the assignment was their undertaking to render the services mentioned. If they have not performed the agreement on their part, but have failed or neglected to perform it, and performance was not prevented or excused by the act or conduct of the defendants, plainly they have no standing in a court of equity to insist upon a specific performance of the agreement in their favor. The consideration for the agreement of the defendants was wholly executory and was the promise of the plaintiffs to render the services specified. The performance of the services was in effect a condition, and non-performance by them would defeat their equitable right. It is well settled that to entitle a plaintiff to specific performance in equity he must show as a condition precedent “ performance, or at least a willing-mess to perform on his part.” Gray v. Murray, 3 Johns. Ch., 179; Pom. Eq. Jur., 1407; May v. Schuyler, 11 J. & S., 107.

The referee found that the plaintiffs did not perform their contract. This finding is conclusive here unless unsupported by evidence. The proof tends to show that the plaintiffs on the 24th of April, 1890, voluntarily abandoned their relation as attorneys and counsel for the defendants, and that the defendants at their request procured other counsel, -and the plaintiffs thereupon executed a stipulation substituting the new counsel in their place as attorneys in the action. The plaintiffs had no further •connection with the suit or with the negotiations for settlement, but such negotiations were continued by the substituted counsel .and culminated in a settlement between the defendants and Lippincott in July following.

In the letter addressed to the defendants under date of April 24, 1890, written in the name of the plaintiffs by one of the firm, requesting the defendants to substitute other attorneys in their place, stating as a reason that they were of opinion that they could, not succeed in establishing the defendants’ claims as they asserted them, “or to any other or greater extent than is contained in the proposed agreement, which you reject,” occurs the-following: “ Under our agreement with you, we have no charges-against you, although our disbursements have been, say, twenty-three dollars, but under that agreement, in the event that you settle the controversies upon substantially the same terms as those you reject, we shall be entitled to the compensation provided for in the agreement.”

It is claimed that the settlement effected by the substituted, counsel was upon substantially the same terms as those proposed by the plaintiffs and rejected by the defendants, and "that, therefore, they are entitled to the compensation provided for in the agreement, as if they had continued to act and.the settlement had been effected by them. Without considering the soundness of this claim it is a sufficient answer to the contention that the: terms of the settlement were in many important respects quite different from those proposed by the plaintiffs. There can be no pretext that the variations were merely colorable and made for the purpose of defeating the claim of the plaintiffs.

We are of opinion that there is no error in the judgment. It is found and the finding is fully sustained by the evidence that-the plaintiffs acted in good faith and conducted the case of their clients with great intelligence and fidelity up to the time of their withdrawal from the case. Their abandonment of the case may have been a mistake. But we think it involved a forfeiture of any rights under the contract of March 24, 1890.

The exception to the refusal of the referee to permit the amendment of the pleadings so as to introduce a cause of action as on a quantum meruit,.was not well taken. The appeal from the-denial of the court of the plaintiffs’ motion to open the case for the introduction of further evidence presents no question reviewable here.

The judgment should be affirmed.

All concur.


source: Caselaw Access Project

author: O’Brien, J.

license: Public Domain

text:
    William B. Duncan, Jr., Resp’t, v The China Mutual Ins. Co., App’lt.

      (Court of Appeals,

      Filed December 1, 1891.)

    1. Insurance (Marine)—Sale of vessel—Transfer of policy—Parties.
    Defendant by its policy agreed that in case the steamship Samana was-lost at sea it would pay to the Samana Steamship Company, on account of whom it might concern, $5,000, and that any change of interest in the vessel should not affect the validity of the policy. During the life of the-policy the vessel was sold to the B. Steamship Company and lost at sea. At the time of the sale it was agreed that the B. Steamship Company was to have the benefit of the seller’s policies of insurance, and it mortgaged the-ship to plaintiff to hold in trust for the purchase price, and transferred to him the policy as security for the Samana Company, which company assigned its rights to plaintiff. In an action upon the policy, Held, that the action was properly brought by plaintiff in his own name.

      2. Same.
    When the contract of insurance was made there was but one party interested in the ship, viz.: the corporation of which plaintiff was manager, but it was the intention of the parties that the benefit of the insurance should be extended to persons who should subsequently acquire and at the time of the loss have an interest.
    Appeal from judgment of tlie New York superior court, general term, affirming judgment for plaintiff. ,

      J. Langdon Ward, for app’lt; Everett P. Wheeler, for resp’t.
   O’Brien, J.

The plaintiff recovered, as for a total loss, upon a policy of insurance issued by the defendant upon the steamship Samana for $5,000. At the time the insurance was effected the vessel was owned by the Steamship Samana Company, Limited, a corporation organized under the laws of Great Britain. The policy was to be in force from the 3d day of August, 1888, to the 3d day of August, 1889, at noon. The Samana sailed from New York November 22, 1888, bound for a port in the West Indies, and has never since been heard from. At the trial the jury found upon sufficient evidence that the steamer was lost in a storm on the voyage and by perils of the sea, one of the risks covered by the policy, prior to December 3,1888. The policy bears date July 28, 1888, and the portions of it material to the questions involved here are as follows:

“By the China Mutual Insurance Company. W. B. Duncan, Jr., on account of whom it may concern, in case of loss, to be paid in funds current in the United States or in the city of New York, to Steamship Samana Co., Limited. Doth make insurance and cause to be insured at and from the 3d day of August, 1888, at noon, until the 3d day of August, 1889, at noon. * * * Upon the body, tackle, apparel, ordnance, munition, artillery, boat and other furniture of and in the good steamship or vessel called ‘ Samana.’ * * * The said ship, etc., for so much as concerns the assured, by an agreement between the assured in the policy, are and shall be valued at as follows:

“ Hull, tackle, apparel and furniture................. $25,000

“ Machinery and boilers..................:......... 20,000

$45,000

“Forty-five thousand dollars ; sum insured, $5,000.

“ To return pro rata premium for every thirty days of unexpired time if this policy be canceled and arrival. * * *

“It is agreed that any change of interest in the vessel hereby insured shall not affect the validity of this policy.”

The plaintiff was the general manager in New York of the Steamship Samana Company, Limited, and owned all of its stock, except twenty-five dollars, which was held by five other persons in order to satisfy some requirement of the English law. On the 5th of October, 1888, The plaintiff, in behalf of his company, entered into an agreement in writing with one Colville, in behalf of another limited company to be organized under the laws of Great Britain, for the purchase and sale of the Samana for $41,000, a portion of the purchase price to be paid down, and the balance secured by a mortgage on the vessel. The contract also provided that the insurance then existing upon the steamer should stand and be held for the benefit of the vendee until other policies could be arranged, and that the vendee should pay the unearned premiums up to such time. The Banana Steamship Company was organized, and in pursuance of the contract the Samana was transferred to it on Rovember 15, 1888, by a regular bill of sale, executed by the plaintiff as manager of the Steamship Samana Company, Limited. On the same day the Banana Steamship Company executed to the - plaintiff a mortgage on the vessel to secure $28,500 of the purchase money remaining unpaid. This was the condition of the title to the vessel at the time of the loss. During all this time the policy remained in the plaintiff’s possession. The Steamship Samana Company made an oral assignment of its claims under the policy to the plaintiff, and subsequently, but after this action was commenced, the company in writing transferred, through a third party, its claim to the plaintiff. It appears from the proofs of loss, which were not objected to, that before the commencement of this action the plaintiff sent a cable message to Colville, who, it may be assumed, was the manager of . the Banana Company in Europe, asking him: “ Shall we commence suit or make policies over to you ? ” To which message there was a reply instructing plaintiff to collect the insurance himself. We do not understand that there is any substantial dispute between the parties that the interest of the Samana Steamship Company as mortgagee could be recovered in an action upon the policy. The insurance was, by the terms of the policy, payable to that company, and, when the loss occurred, it still had an interest in the vessel, not as owner, it is true, but as the holder of a mortgage to secure a portion of the purchase money.

The only point that is made by the defendant’s counsel, so far as this interest is concerned, is that it cannot be recovered by a suit brought by the plaintiff in his own name, and, in any event, the amount of the recovery must be limited to such proportion of the interest represented by the mortgage, as the amount insured bears to the whole value of the ship, or to one-ninth of $28,500. The contract was made by the defendant with the plaintiff though the loss, if any, was made payable to the Steamship Samana Company, Limited. The plaintiff was the manager and owner of the company except the five shares of five dollars each. The policy was in his possession from its delivery, by the defendant, to the time of the commencement of this action. It was agreed, at the time of the sale of the vessel to the Banana Companv, that the mortgage, for the purchase money, should run to the plaintiff instead of the Samana Company, and it was agreed that he should hold the policy for the benent of all interests. All the facts showing the plaintiff’s connection with the transaction, the sale of the vessel and the title to the same, the execution of the mortgage to the plaintiff, and the agreement in regard to the insurance, appeared upon the face of the complaint. As ihe defect of parties plaintiff was not raised by the defendant, either by demurrer or answer, the objection is deemed to be waived. Code, §§ 488, 498, 499 ; Sullivan v. N. Y. & R. C. Co., 119 N. Y., 356; 29 St. Rep., 747. Under those circumstances, if the action was simply to recover for such interest as the Samana Company had in the loss, the plaintiff’s right to recover, as trustee or assignee, could be upheld. Cone v. Niagara Fire Ins. Co., 60 N. Y., 619; Martin v. Tradesmen’s Ins. Co., 101 id., 504. But in order to justify the full recovery in this case, it must be shown that the indemnity of the policy extended to the interest of the Banana Company as vendee at the time of the loss, and that the plaintiff was, under the circumstances of the case, competent to sue for and recover such interest also.

The contract insures “ W. B. Duncan, Jr., on account of whom it may concern, in case of loss, to be paid * * * to Steamship Samana Company, Limited,” and this is accompanied with a stipulation by which the parties agree that any change of interest in the vessel, thereby insured, shall not affect the validity of the policy. While contracts of marine insurance are to be liberally construed in favor of the insured, they are not deemed to cover any risk or any interest that was not fairly within the scope and intention of the parties when the contract was made. The technical phrase “for whom it may concern” or any other terms of equivalent import in such a policy will be applied to the interest of the party for whose benefit it was intended by the person who procures or orders the insurance. These terms will not carry the benefit of a policy to a risk or an interest not fairly within the contemplation of the parties to the policy. Phillips on Ins., § 383; 2 Pars. on Marine Ins., 45; Hooper v. Robinson, 98 U. S., 528 ; Henshaw v. The M. S. Ins. Co., 2 Blatch., 99; Rogers v. Traders’ Ins. Co., 6 Paige, 583. The result of this principle is that a party who has an interest in the property covered by such a policy at the time of the loss will be protected without any express stipulation to that effect, though he had no interest at the commencement of the risk, providing he was intended to be insured. The construction that should be given to such contracts was thus stated by Judge Folger in Waring v. Indemnity Fire Ins. Co., 45 N. Y., 612 :

“ Of course, it must be made to appear that the owner was in the intention of the person effecting the insurance when the contract was made. Such intention need not have fastened at the time of entering into the contract upon the very person who, when the contract matures, seeks to take the benefit of it * * * And it is to be assumed that every one was in the intention of the insurer who subsequently with design takes such relations to him as brings him within the clauses of the policy. The intention must have been to effect insurance for any person and all persons-who during the running of the policy should have goods within its description of property insured.”

When the contract in question was "made, there was but one party interested in the ship, namely, the corporation of which the plaintiff was the manager. But, beyond all question, the parties to the contract intended that the protection and benefit of the in-surance should be extended to persons who should subsequently acquire, and at the time of the loss have an interest. By agreeing to indemnify in case of loss “ whom it may concern,” and, in the same contract, stipulating that any change of interest should not affect the validity of the policy, the underwriters must, in the absence of some condition to the contrary, be deemed to have contemplated a sale of the vessel such as took place in this case, and a liability on their part to the vendee in case of a loss. The contract was not a personal one, between the plaintiff or the Steamship Samana Company on the one hand, and the defendant on the •other, but was intended to apply to and cover subsequently acquired interests of others under transfers from the insured. These principles would, of course, extend the benefits of the policy in question to the Banana Company without any notice to the defendant or any further assent on its part The only remaining question is the right of the plaintiff to sue for and recover that part of the claim under the policy arising from the loss that belonged to the Banana Company. We do not think there is any embarrassment in the fact that the mortgage for the purchase money ran to the plaintiff. On the undisputed evidence he took this security for the benefit of the corporation, of which he was the manager and agent. It is competent to look beyond the mere form of the instrument to the actual transaction and then it is seen that the interest represented by the mortgage was that of the Samana Company, which, for all the purposes of this case, can be said to be the real mortgagee. It is quite likely that, upon a complaint properly drawn, there was evidence enough in the case to warrant a finding that the parties in interest intended to transfer their respective interests to the plaintiff, to recover for them as an assignee. But the complaint does not seem to have been framed nor the trial had upon this theoiy.

It is, however, substantially alleged and proved that at the time of the loss the plaintiff held the policy under an agreement between all the parties interested in the vessel that it should stand in bis hands as an indemnity to them in case of loss. He was their trustee, and as such could enforce the contract for their benefit The plaintiff also seems to be within § 449 of the Code, which authorizes the trustee of an express trust to sue in his own name without joining with him the party for whose benefit the action is prosecuted. A person with whom, or in whose name, a contract is made for the benefit of another is a trustee of an express trust within the meaning of that section. The contract in question was made by defendant with the plaintiff. It ran to him by name for the benefit of the Samana Company, and, as we have seen, by the use of the phrase “ for whom it may concern ” to its transferee. In the absence of any pleading by defendant raising any question in regard to the nonjoinder of parties in interest, and in view of the fact that payment of the loss to the plaintiff will, under all the circumstance's of the case, discharge the underwriters, the objection now as to the form of the action is, we think, quite untenable. The exceptions taken at the trial were properly disposed of in the courts below.

The judgment should be affirmed with costs.

All concur (Gray, J., in result), except Earl, J., not voting.

       Affirming 39 St. Rep., 248.


author: Peckham, J.

text:
    Henrietta A. Lougheed, App’lt, v. The Dykman’s Baptist Church et al., Resp’ts.

      (Court of Appeals,

      Filed December 1, 1891.)

    Will—Devise—Society sot incobfobated at testator’s decease.
    By testator’s will lie devised certain real estate “ at the death of my wife ” to defendant, then an unincorporated organization, to he used as a parsonage, and provided that when the society ceased to use it for that purpose it should revert back to his heirs at law. Held, that the devise did not vest the estate in the devisee until the death of the wife, and if at that time the devisee was in existence and capable of taking by reason of having been incorporated, it would take the estate under the devise.
    The plaintiff appeals -from a judgment of the general term of the supreme court, second department, affirming a judgment of the special term which dismissed her complaint upon the merits. The action was brought to partition certain real estate in Putnam county among the heirs of one Amos Dykman, who died April 17, 1882. The plaintiff alleged in her complaint that she was the owner in remainder of the real estate in question, as a tenant in common with another, subject to the life estate therein of the widow of the deceased Dykman, and notwithstanding the apparent devise of such real estate by the decedent to another. This apparent devise the plaintiff alleged was void and the allegations in her complaint brought her within the provisions of §§ 1533 and 1537 of the Code of Civil Procedure.
    The testator at the time of his death left a widow, Iva Jane Dykman, also the plaintiff who was his niece, and the defendant Laura A. Ma-bie, his sister, the niece and sister being the sole heirs at law. He left a will which was duly admitted to probate, by which he gave to his wife the use of all his real estate during her natural life. The second paragraph of his will is as follows:
    “ Second. At the death of my wife I give and devise all that part of my real estate situate in the said town of South East, which lies southerly of the new road leading westerly from Dykman’s station, past the dwelling house of Coles B. Fowler to the Baptist church and society of Dykman station to be used by said church and society as a parsonage forever. And whenever said society ceases to use the same as a parsonage, the same shall revert to my heirs at law. The real estate so intended as a parsonage includes my present dwelling house and eighty acres of land, more or less.” The widow took possession of the real estate upon the death of the deceased and was still in possession at the time of the commencement of this action.
    The church organization known as the Baptist Church and Society of Dykman’s Station, was organized about 1866, and the deceased was a member of the society and contributed to its support, and it continued to exist as a church organization up to May 1889, when it became incorporated under the name of the Dykman’s Baptist Church and Society and it is the same organization as is mentioned in the second paragraph of the will of the deceased.

      Frederick S. Barnum, for app’lt; Abram J. Miller, for resp’ts.

       Affirming 35 St. Rep., 270.

   Peckham, J.

The plaintiff maintains that the devise to the Baptist church, as set forth in the second clause of the will of Dykman, deceased, is void because the testator by £he language used in the will intended to vest in the above mentioned church immediately upon his death the portion of the real estate mentioned by him and of which he died seized, subject to the life estate of his wife, and that as the church was at the time of the death of the testator an unincorporated organization and unable to take property by devise, the devise itself was void and the property descended to the heirs at law of the testator. The question is, primarily, one as to the intent of the testator. Did he, by the language he used, intend to vest the title to the portion of his, estate described by him in the church at the moment of his death, or did he intend that such vesting should not take place until the death of his wife ? If he intended that it should at once vest in the church society, the devise is void, for at that time the society was not incorporated and was unable to take under the will. What his intention was must, of course, be discovered from a perusal of the language used by him in the will itself. It is urged that if, at the death of the testator, the real estate at once vested in the heirs at law, it becomes of no importance whether thereafter or prior to the death of the widow the church should become incorporated and thereby rendered capable of taking property by devise. The property having once vested in the heirs could not, it is claimed, be thereafter divested and go to the incorporated church upon the death of the wife. Cases are cited by counsel for appellant which he says uphold this contention.

The- most that is decided in any of the cases he has called our attention to is, that when the testator intends that the devise or bequest shall vest in the devisee or legatee at once upon his own death, although to be enjoyed in possession at some future time, if at the decease of the testator the devisee or legatee is incapable of taking, the devise or bequest is void and the devisee or legatee cannot thereafter take, even though capable of taking when the period of enjoyment would otherwise have arrived.

The very question to be here decided is when does the devise vest in the devisee ? If it were intended that it should vest immediately upon the death of the testator, then we can say that on account of the inability of the devisee to take at that time the devise was void and the land would go to and vest in the heirs-at-law, unless otherwise provided in the will, and once having unconditionally vested, the subsequent capacity to take on the part of the devisee would not divest the property from the heirs.

I have, however, been unable to find any case which holds that a testator may not SO' provide for the future vesting of the title to real estate in his devisee that in the meanwhile it will vest in his heirs by operation of law, subject to be divested upon the happening of a contingency subsequent to his death, and provided for in the will. If the testator had in so many words devised his real estate to his wife for life and remainder in fee to his heirs at law, but if at the death of his wife the Dykman’s Baptist Church should then be a duly incorporated society capable of taking property by devise, then in that case he devised the real estate to it to use the same as a parsonage, etc., can there be any doubt that the church, although unincorporated at the death of the testator, yet if incorporated at the time of the death of the wife, would take the property devised ? The principle decided in Burrill v. Boardman, 43 N. Y., 254, and Shipman v. Rollins, 98 id., 311, upholds such a devise. A fee may be divested upon the happening of a certain event provided for by the testator. Leonard v. Burr, 18 N. Y., 96.

Although such words are not made use of, if from the whole language of the will and the implications which naturally arise therefrom the intention of the testator appears to have been to vest the estate in the devisee at his wife’s death and not before, and if the devisee at that time shall be able to take, we think the devise is valid and the judgment must be affirmed.

This would leave the title to the remainder of the estate from the time of the death of the testator to that of his wife in the heirs of the testator, subject to be divested if at her death the devisee were an existing corporation.

The question then recurs, when does the estate vest ? As was well said by the learned judge in delivering the opinion of the court below in this case, the devise herein is of such a nature that the devisee could not alien or dispose of it; certainly not in the lifetime of the tenant for life. The property was devised provided it should be used as a parsonage by the church society, and if the society ceased to use it as such, the property was to revert to the testator’s heirs at law, and thus it is clear the testator never intended the devisee should have any possible benefit from the devise until his wife’s death. The right of property and the right of enjoyment were to come into being together, and there could be no right of property separated from the right of enjoyment.

It seems to me that as the testator only contemplated that the society should have the right to use this property after the death of his wife, and then only as a parsonage, and that when it ceased to be used as such the land should revert to the heirs of the testator, he meant that the estate should not vest until the death of the wife. If at that time the society could take, it was all that was necessary.

It may be the testator did not contemplate the necessity of an incorporation of his devisee. He intended, as we must assume, to make a valid devise, and to that end he intended and supposed that his devisee should and would be capable of taking the devise when the time came, and if anything were necessary to be done before that time arrived in order to render itself capable of taking, it must be presumed the testator intended it should be done. Hence, if the formation of a corporation were a condition precedent to the possibility of the vesting of the estate under the devise, it would follow that the formation of such corporation was not outside of or counter to the intention of the testator. Construing his intention from the language used in the will to be that the estate should not vest in the devisee until the death of his wife, it would in the meantime vest in the heirs, and if upon the death of the wife there is a devisee capable of taking, the estate is divested from the heirs and passes to the devisee. The law provides for this to exactly the same extent as if the testator had conveyed the fee in so many words to the heirs upon the conditions mentioned.

The learned counsel for the appellant has cited some cases where the language used as to the time of enjoyment of the devise was much the same as that used here, and where it had been held that the testator meant that the devise or bequest should vest in the devisee or legatee at once, and simply the actual enjoyment in possession be postponed to a future time. But the limitations as to the future enjoyment and possession of this real estate by the church are of such a nature as to clearly distinguish this case from all the others cited by counsel. Generally it may be said that the language as to the time of enjoyment as used here would be regarded by the courts as causing a vesting of the estate immediately upon the death of the testator.

The counsel for the appellant also claims the condition upon which the devise was made was void, and that therefore no argument can be drawn as to the intended postponement of the vesting until the death of the wife, founded upon the inability of the devisee to deal with the estate as a vested one. If we were to assume the invalidity of the condition, still the time when the devise would vest would not be thereby affected. It would still be a question of intention on the part of the testator, and upon that question even a void provision in a will may be looked to for light. It would still appear the testator intended the devisee to take no interest in the land excepting upon the condition and for the purpose, and at the time expressed by him, and that intention would still be entitled to the same weight as if the condition were legal.

We are of the opinion that the devise does not vest the estate in the devisee until the death of the wife of the testator, and if at that time the devisee shall be in existence, and capable of taking, it will take the estate under the devise.

The devise is, therefore, not void, and the judgments of the special and general terms must be affirmed, with costs.

All concur.


author: Earl, J.

text:
    Andrew Wilson, App’lt, v. William A. Parshall, Resp’t.

      (Court of Appeals,

      Filed December 1, 1891.)

    1. Deed—Title.
    B., owner of mortgaged premises, conveyed them by deed absolute to defendant a member of the firm of T. & Co., the mortgagee, upon an agreement that T. & Co. might sell the premises, returning to B. any surplus over the indebtedness. Between 1877 and 1880 B. became a bankrupt, and in his schedules included these premises, stating that they were subject to two mortgages, and that B.’s interest was nothing. In 1880 defendant conveyed the premises to plaintiff for value by a deed containing a covenant of seizin. Thereafter the conveyance by B. to his assignee in bankruptcy was discovered, and for large expenses incurred in remedying this supposed defect in the title the plaintiff brought this action. Held, that he could not recover, as it was clear from the evidence that the debt by B. was really paid by an absolute unconditional transfer of the real estate to the defendant, B’s only interest being in the proceeds to be realized on a sale thereof by the defendant, and thus there was no defect in defendant’s title.
    2. Same.
    A grantee suing for a breach of covenant in a deed and assailing it by paroi evidence to show that it was intended as a mortgage must show not only that the claim was made that his grantor’s deed was a mortgage, but he must establish as a fact that it was in fact intended as a mortgage.
    Appeal from judgment of the supreme court, general term, first department, reversing judgment recovered on verdict of jury, and order denying motion for new trial.

      A. B. Cruikshank, for app’lt; H. Aplington, for resp’t.
   Earl, J.

This action was brought to recover damages for the breach of the covenants contained in a full covenant deed of real property situate in the city of New York, which was purchased of the defendant by the plaintiff in 1880. The plaintiff’s claim is that there were breaches of the covenants of seizin, of a right to convey and against incumbrances. The court directed a verdict against him, and he claims that, at least, the evidence should have been submitted to the jury.

The real estate formerly belonged to John W. Bockhorn, and on the 3d day of December, 1877, he conveyed it to the defendant by a deed absolute in form containing full covenants, subject, however, to two mortgages, one for $6,000 and another for $5,100, the latter having been executed to secure an indebtedness from him to the firm of H. K. Thtirber & Co. The plaintiff claims that this deed was executed to the defendant, who was connected with that firm, to secure the same debt, and that therefore it was in fact and legal effect a mortgage, and that thus his title was imperfect.

These deeds in form conveyed a perfect title to the real estate, and the burden was upon the plaintiff in this action for a breach of the covenants, to show that they did not, and in this he utterly failed.

The security of titles and sound public policy require that a party alleging that a deed, absolute in form, is nevertheless a mortgage, should show it by very satisfactory evidence, and where he attempts to show it by oral evidence, his proof should amount to more than a mere guess or surmise, or even inferences which are j ust as consistent with one theory of the deed as the other.

In limine it may be observed that it is entirely improbable that Thurber & Co., already having a mortgage to secure their debt, should take another mortgage on the same property, for the same debt, without any apparent reason or advantage, and then record it as a deed. But the proof shows, without any doubt, that this deed was not intended as a mortgage. While Boekhorn, a witness for the plaintiff, testified in a general way that the deed was given to secure the debt to Thurber & Co., he also testified that the debt did not survive the deed and that he was not thereafter indebted to them, and that Thurber & Co. were to sell the land, and after paying the liens thereon, including the debt to them, they were to account and pay over the balance to him; and H. Eh Thurber, the only other witness upon the same subject, testified substantially to the same effect. Thus it is clear that the debt was to be secured and really paid by an absolute, unconditional transfer of the real estate to the defendant, and by vesting the absolute title in him for the benefit of Thurber & Co., and thereafter Boekhorn had no further title to or interest in the land as such, his only interest being in the proceeds to be realized on a sale thereof by the defendant. Then there was no defect in defendant’s title. He did with the land exactly what he had the right to do, under the paroi arrangement with Boekhorn, and Bockhorn’s only right was to call him to account for the proceeds. In the end they appear to have proved insufficient to pay the liens upon the land.

The mere fact that Boekhorn, or some one in his behalf, or representing him, claims that the deed was intended as a mortgage, does not render the title conveyed by the defendant defective, or make the defendant liable for breach of any of the covenants in his deed. Any absolute deed may be assailed by paroi evidence given for the purpose of showing that it was intended as a mortgage. But a grantee suing for a breach of the covenants in the deed to him in such a case must show, not only that the claim is made that his grantor’s deed was a mortgage, but he must establish that it was, in fact, intended as a mortgage. This the plaintiff failed to do.

There may be an apparent cloud upon the title to real estate conveyed by a full covenant deed, and the circumstances may be such that a court of equity would not compel a purchaser under an executory contract to take a deed. Yet if he takes the deed and then sues for a breach of the covenants, the suit is well defended by proof satisfactory to the court upon all the evidence submitted that the title was, in fact, not defective. Evidence which will defend an action for specific performance is not always sufficient to maintain an action for breach of covenants. The one action may concern apparent defects in the title, and the other must concern real defects.

The judgment should be affirmed, with costs.

All concur.

       Affirming 27 St. Rep., 178.


author: Per Curiam.

text:
    Albert O. Briggs, App’lt, v. Harvey Austin, Resp't.

      (Court of Appeals,

      Filed December 1, 1891.)

    I. Landlord and tenant—Lease oe earm—Title to hat.
    In the absence of an agreement in a lease of a farm to the effect that the title to the hay raised thereon vests in the landlord as security for the rent, or some other purpose, the law vests it in the lessee, and an agreement by the latter to maintain cows is an independent stipulation, which the sale or mortgaging of the hay does not disable him from performing, however unlikely performance might be after selling the hay, in view of the lessee’s insolvency.
    2. Same—Creditor’s action.
    Such a landlord is not in a position to assail the validity of the mortgage as a creditor of the mortgagor.
    Appeal from, judgment of the supreme court, general term, fourth department, affirming judgment in favor of defendant,

      R. M. Townsend, for app’lt; Burr Mattice, for resp’t.

       Affirming 36 St. Rep., 1019.

   Per Curiam.

The complaint was dismissed upon the opening of counsel for the plaintiff, wherein the plaintiff confined his claim for relief to a demand for an injunction restraining the defendant from taking possession of the hay grown on the premises, under a chattel mortgage executed to him by the lessee of the farm. The plaintiff alleged in his complaint that by the lease the title to the hay grown on the farm was to be in the plaintiff until the rent should be paid, and further, that the defendant’s mortgage was fraudulently executed by collusion between the tenant and the defendant mortgagee, to deprive the plaintiff of his title to the hay. There are two insuperable obstacles to the plaintiff’s recovery. The lease does not vest the title to the hay produced on the farm in the plaintiff, as security for the rent, or for any other purpose, and the law, in the absence of an agreement to that effect, vests it in the lessee. The agreement of the latter to maintain the cows was an independent stipulation which he was bound to perform, and the sale of the hay did not disable him from performing, however unlikely performance might be after selling the hay, in view of the lessee’s insolvency. But a sale of the hay by the tenant was not in violation of any contract with, or of any legal right of the lessor.

Second: the plaintiff is not in a position to assail the validity of the mortgage as a creditor of the mortgagor. He at most has a debt against the mortgagor for unpaid rent or any violation of the terms of the lease, which claim has not gone into judgment, and it is well settled that a general creditor having no judgment cannot maintain an action to set aside a conveyance by his debtor in fraud of the rights of creditors. Sullivan v. Miller et al., 106 N. Y., 635 ; 11 St. Rep., 312.

The judgment should be affirmed, with costs.

All concur.


author: Finch, J.

text:
    Charles V. Whitten et al., App’lts, v. John C. Fitzwater, Resp’t.

      (Court of Appeals,

      Filed December 1, 1891.)

    Replevin—Fraud—Charge.
    In an action to replevin goods on the ground of fraud in their purchase it was shown that the goods were ordered on the 7th, shipped on the 10th and received on the 16th, and on the 22d the purchaser assigned to defendant. Tho court charged that if at the time of the purchase the vendee, knowing himself to be insolvent, had the intention not to pay, he commit^ ted a fraud on the plaintiffs which entitled them to recover. To a request to charge that if when he received the goods, he knew, or had reasonable cause to know, he could not go on in business, he was chargeable with intent not to pay, the court replied that the intent must be at the time the contract was made, and to a further request to charge that in the absence of proof of unforeseen circumstances arising to change his condition between the purchase and reception of the goods and his failure, he would he presumed to have contemplated an assignment when he received the goods, six days before, he replied that it was a question for the jury. The same reply was made to a request to charge that the debtor could not be permitted to say he intended to pay for a large bill of goods ordered on the 8th of March and received six days before the assignment, and also to a request to charge that in the absence of unforeseen circumstances arising in the interim, the debtor would be presumed to have known that he must fail, and to have contemplated an assignment when he received the goods, six days before. Sold, that, the court erred in the ruling; that there was no purpose to change the position previously assumed, and the error then made was not corrected by the latter ruling.
    Appeal from judgment of the supreme court, general term, fifth department, affirming judgment entered on verdict of a jury in favor of defendant, in an action of replevin, and also affirming an order denying plaintiffs’ motion for a new trial made on the minutes of the court.

      Chas. E. Ide, for app’lts; Calvin J. Huson, for resp’t.

       Reversing 33 St. Rep., 953.

   Finch, J.

The question of fact in this case was one of fraudulent intent. The property in controversy was bought by Gray of the plaintiffs on March 7,* 1887, by giving an order therefor to their agent on that day. The goods were shipped March 10th, and received and accepted by Gray March 16th, who failed and made a general assignment to the defendant on the 22d of the same month. The inquiry involved was whether the purchase was made with an intent not to pay for the goods, and it was submitted to the jury, in the body of the charge, in this language: “ Whether upon the 7th day of March, 1887, at the time the agent made the sale, did Gray purchase these goods intending not to pay for them ? ” The intent of the assignor on March 7th was the question submitted, and the giving of the order was treated as the “ purchase ” by Gray, the purpose and design of which was to be ascertained. With that preliminary statement of the question the learned trial judge added: “If when he purchased the goods, I care not.what his financial condition may have been, if he believed that he could do as he had been doing in the past, get somebody to discount and carry his notes, and that he could' pay for these goods, I say if he honestly purchased, them, believing at that time that lie could continue his business in. the future as he had. in the past, although he was insolvent, and I think it is hardly disputed but that he was insolvent from the time he commenced business, then the plaintiffs- cannot recover in this action. On the other hand, if when he purchased the goods he knew that he was about to make an assignment, and that, from the condition of things, he could not pay for them, then the plaintiffs are entitled to a verdict It is for you to say, upon all the facts of the case, what his-intention was at that time.” This language of the charge clearly fixed the date of the purchase, and the time at which the intent was to be determined, as the 7th of March, when the order for the goods was given, and the jury could not easily have understood it otherwise.

But all ground for misunderstanding was removed when the plaintiffs’ counsel called the attention of the court to the precise question of time, and requested a charge “that if at the time Gray received the goods, notwithstanding what he might have thought when he made the contract, he knew, or had reasonable cause to know, that he could not go on in business, that he is equally chargeable with an intent not to pay.” This request was refused, the court saying: “ The intent must be at the time the contract was made.” To this there was, an exception. It is conceded that this was error, and upon a point vital to the controversy; but the answer made to it is that it was afterward cured by a substantial withdrawal; the majority of the general term founding their conclusion upon the disposition made of later requests. In answer to one of them, the court said : “ If he knew he was insolvent, and had reason to believe he could not pay for them, the proposition is correct.” The plaintiffs’ counsel then asked the court to charge “ the same proposition as a proposition of law relating to the time when he received as well as to the time he purchased.” This request was declined, and the plaintiffs excepted. Here again the attitude of the court is consistently maintained,, and the question of intent confined to the date of the order.

We now come to the two requests upon which the majority of the general term rely. The first was this: “ That it is not enough for Gray to say, or not enough for the jury to say, that it was perhaps uncertain what day he would be obliged to stop payment; that if he was insolvent he might stop any day; he cannot be-permitted to say he intended to pay for a large bill of goods ordered by him on the 8th of March, and received six days before-the assignment.” The court answered: “ That is a question for the jury.” The point embodied in the request was what constituted sufficient evidence of the intent, and not at all as of what, date the intent was to be found. The plaintiffs’ theory was that the fact of insolvency, followed by the assignment, shut out the inference that the failure was uncertain at the daté of the purchase, and no attempt was made, or understood to be made, to change the ruling as to time. The next request was this: “ That, in the absence of proof of unforeseen circumstances arising to change his condition between the purchase and receipt of the goods, and the failure, Gray will be presumed to have known that he must fail, and to have contemplated an assignment when he received the goods six days before.” To which the court answered : “ That is a question for the jury.”

It is obvious that the request was aimed at the proper presumption of law to be drawn in a case where the court thought it could only be a presumption of fact. The failure and assignment on the 22d of March indicated Gray’s knowledge that he must fail and make an assignment on that date, and the proposition was that if the situation and circumstances were just the same six days earlier, he must be presumed then to have known that he could not pay. The court could not say that what he then knew and thought was totally immaterial, because it might prove to be an important fact bearing upon his intent at the date of the order, for if an unchanged situation transferred the intent back to the receipt of the goods, it would equally transfer it back to the date of the original contract; but the court could and did say that the inference was one of fact and not of law. We can see in this ruling no purpose to change the position previously assumed, and it is, at all events, quite certain that the jury were not freed from the distinct and definite impression made upon them at the earlier period. If the error was to be corrected at all, it should have been done frankly and clearly, and not left to be argued out of another proposition dealing with a different question. The jury were justified in' the assumption that no change in the ruling three times made was either intended or effected.

For this error the judgment should be reversed and a new trial granted, costs to abide event.

All concur.


author: Andrews, J.

text:
    Michael McQuigan, Resp’t, v. The Delaware, Lackawanna & Western R. R. Co., App’lt.

      (Court of Appeals,

      Filed December 1, 1891.)

    Negligence—Supreme court no power to order physical examination OF PLAINTIFF.
    The supreme court has no power in advance of the trial of an action for a personal and physical injury to compel the plaintiff on an application made on behalf of the defendant to submit to a surgical examination of his person by surgeons appointed by the court with a view of enabling them to testify on the trial as to the existence and extent of the alleged injury.
    Appeal from order of the supreme court, general term, fourth department, affirming order denying motion to require plaintiff to submit to a personal examination.

      Lewis Marshall, for app’lt; Andrew Hamilton, for resp’t.

       Affirming 38 St. Rep., 1021.

   Andrews, J.

The sole question presented by this record is whether the supreme court has power in advance of the trial of an action for a personal and physical injury to compel the plaintiff on an application made in behalf of the defendant to submit to a surgical examination of his person by surgeons appointed by the court with a view of enabling them to testify on the trial as to the existence and extent of the alleged iujury. The question is not new in the courts, although so far as we know it was first presented in 1868, before a judge of the New York superior court, at special term, in the case of Walsh v. Sayre, 52 How. Pr., 334, who affirmed the existence of the power. The contrary was held by the general term of the third department in Roberts v. Ogdensburgh & L. C. R. R. Co., 29 Hun, 154.

In 1877, the supreme court of Iowa in the case of Schroeder v. Chicago, etc., Railway, 47 Iowa, 375, sustained the doctrine that the court had an iulicrent jurisdiction to grant a compulsory order that the plaintiff submit to such examination, and this decision has been followed by the courts of several of the Western and Southern states and in others the power has been denied.

The same question was considered in the United" States supreme court in the recent case of Union Pacific Railroad Co. v. Botsford, 141 U. S., 250, decided in May, 1891, and the court (two judges dissenting) decided adversely to the claim that the court had power to compel such examination. The opinions of the several courts which have been passed upon the question present very fully the considerations bearing upon it. We concur in the view taken by the supreme court of the state and the supreme court of the United States, and we can add very little to the full discussion to be found in the opinions of those courts.

The powers of courts are either statutory or those which appertain to them by force of the common law, or they are partly statutory and partly derived from immemorial usage, which latter constitutes their inherent jurisdiction. They are organized for the protection of public and private rights and the enforcement of remedies. Presumptively, therefore, whatever judicial procedure is essential to enable courts to exercise their function is authorized. The maxim that there is no right without a remedy, justified the courts in the earlier periods of the common law in inventing writs and modes of procedure adapted to present for adjudication in proper form every question of judicial cognizance. The powers and jurisdiction of the courts of common law and chancery in England are to be found in the English statutes and in the rules, precedents, decisions and procedure of the courts. The power which the courts actually exercised, supplemented by statutory powers, constitutes in a general sense their jurisdiction.

Upon the organization here of the federal and state governments courts were constituted, and in this state they succeeded to the powers theretofore exercised by the courts of law and chancery in England, so far as they were applicable to our situation. It is a significant fact that not a trace can be found in the decisions of the common law courts of England, either before or since the Eevolution, of the exercise of a power to compel a party to a personal action to submit his person to examination at the instance of the other party. If the power existed it is difficult to suppose that it would not have been frequently invoked. Actions for assault and battery, for injuries arising from negligence, and generally for personal torts, were among the most common known to the law, and yet, so far as we can discover, in no case was it supposed or claimed that the court was armed with this jurisdiction. The non-exercise of a power is not conclusive against its existence, but it is inconceivable that if the power in question existed it should have been unused for centuries and never have been called into activity.

In two cases cited by Justice Gray in his opinion in Union Pacific Railway Company v. Bostford, supra, the court of common bench in England refused an order for the inspection of a building on the application of the plaintiff in an action for work and labor performed by him thereon on the ground of want of power. Newham v. Tate, 1 Arnold, 244; Turquand v. Strand Union, 8 Dow. P. C. 201. These cases tend to negative the existence of the power in the English courts claimed for our courts in the case at bar. The only authority in the English common law courts in any degree analogous is found in the power which the courts of England have occasionally, though rarely, exercised, to issue on the application of apparent heirs the writ de ventre suspiciendo, to compel a widow claiming to be with child by her deceased husband to submit her person to examination. The practice in England is sui generis and has never been adopted here. It may have originated in the peculiar favor shown to heirs by the law of England, but whatever its origin it seems repugnant to common right, and the fact that in this instance only have the courts of England exercised the power to compel the examination of the person in a civil proceeding tends to show that the power is not there regarded as general, but special and peculiar, and limited to the particular case.

The doctrine of the cases in chancery, Briggs v. Morgan, 2 Hagg. Cons. Ct., 324; Devanbagh v. Devanbagh, 5 Paige, 554; Newell v. Newell, 9 id., 25, that in an action to procure a decree of nullity of marriage on the ground of impotence or sexual incapacity, the chancellor may compel the defendant to submit to a surgical examination, is a graft from the civil and common law, and, as has been said, “ rests upon the interest which the public as well as the parties have in the question of upholding or dissolving the marriage state, and upon the necessity of such evidence to enable the court to exercise its jurisdiction.” Gray, J., in Union Pacific Railway Company v. Botsford, supra.

When we examine the history of the power of common law courts to compel the production and inspection of books and papers in possession of the opposite party in a civil action, we find that originally the courts disclaimed any power in the mattter and the remedy by bill of discovery was the only resource of the party desiring such discovery. Finally the common law courts assumed a limited equitable jurisdiction over the subject, and in addition to the rule that a party pleading a deed should make forfeit of the instrument which enabled the other party to demand oyer, the courts by order compelled a party who in his pleading relied upon a written instrument, not a deed, to give inspection to the other party, if required, and so in other special cases. The courts in this state, prior to any statute, exercised a limited equitable jurisdiction of the same character. Lawrence v. Ocean Ins. Co., 11 Johns., 245; Denslow v. Fowler, 2 Cow., 592, note. But this limited jurisdiction was exercised sparingly, and with hesitation, and it was not until statutes were enacted in England and in this state conferring upon common law courts the same power to compel the discovery and inspection of books and papers which was exercised by courts of chancery on bills of discovery, that courts of common law claimed or exercised full power over the subject. St. 14 and 15 Viet., chap. 99; St. 17 and 18 Viet, chap. 125 ; Rev. St, 199, § 21. The limited jurisdiction exercised by these courts before the statute was in the nature of a usurpation, and so far as we can discover it was never considered that they possessed an inherent power in aid of justice to grant relief in cases outside of the narrow limit mentioned. The power to compel an inspection of books and papers relevant to the controversy, in possession of either party, is of a similar nature to that invoked in the present case, and if the inherent power of the court did not extend to the one case, it is difficult to suppose that it embraced the other. The power to compel a party to submit to an examination of his person has never been conferred by any statute.

The provisions of the Revised Statutes authorizing the court to compel the production of books or papers have been reenacted in the Codes of Procedure. The statutes also contain specific provisions for the examination of a party on oath before trial, at the instance of the other party. The omission in these statutes of any reference to the power now under consideration is -quite significant We cannot say that the exercise of the power claimed might not in some cases promote the cause of justice and prevent the consummation of fraud. On the other hand, unless ■carefully guarded, it would be subject to grave objections.

But we have to deal only with the question of the power of the courts, in the absence of any legislation. It is very clear that the power is not a part of the recognized and customary jurisdiction of courts of law or equity. The doctrine that courts have an inherent jurisdiction to mould the proceedings to meet new conditions and exigencies is true, but in a limited sense. They cannot, under cover of procedure or to accomplish justice in a particular case, invade recognized rights of person or property. Mo court, we suppose, can abrogate an established rule of evidence, as, for example, the rule that hearsay evidence is inadmissible, or the rule of the common law that parties shall not be witnesses, or "that interest disqualifies. They may apply existing rules to new circumstances. Mor is it, we conceive, within the power of the ■court to create remedies unknown to the common law, or institute a procedure not according to the course of the common law. It is most important that courts should proceed under the sanction of an orderly and regulated jurisdiction, and that as little as possible should be left to the discretion of a judge. The exercise by the court of the power now invoked, as has been shown, is not sanctioned by any usage in the courts of England or of this state. Its existence is not indispensable to the due administration of justice. Its exercise, depending on the discretion of the judge, would be subject to great abuse. We think the assumption by the court of this jurisdiction, in the absence of statute authority, would be an arbitrary extension of its powers. It is a just inference that an alleged power which has lain dormant during the whole period of English jurisprudence, and never attempted to be exercised in America until within a very recent period, never in fact had any existence.

We have purposely omitted to repeat the views and authorities upon this question set forth in the opinions in Roberts v. Ogdensburgh R. R. Co., and in Union Pacific Railway Co. v. Botsford, and we refer to those opinions for a fuller discussion of the grounds upon which the denial of the power claimed proceeds. The order should be affirmed.

All concur.


author: Van Brunt, P. J.

text:
    Daniel F. Appleton et al., Resp’ts, v. Kate Fuller et al., Resp’ts, and Meta Fuller et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed November 13, 1891.)

    Will—Codicil—Construction.
    By tlie will of F. his executors were directed, after payment of debts, to-divide the estate into as many parts as he should leave children living, except one daughter, and after payment of annuities charged thereon, to pay to each of his children who should survive him an equal share of the net income; it also provided that at the death of any child its portion should go to its heirs in fee. By a codicil. F. revoked such portions of his will as-provided for his two sons, gave them legacies in lieu thereof, and provided that the trust estate should be divided into as many portions as he left, daughters surviving, and confirmed the trust provisions in all other respects. Held, that the daughters and their issue were alone entitled to share in the trust estate, and that the children of the sons had no interest, therein.
    Motion for new trial on case and exceptions.

      F. S. Wait, for app’lt, Meta Fuller; C. D. Brower, for app’lts,. W. M. & Bayard C. Fuller; E. E. Anderson, for pl’ffs, resp’ts ;. B. S. Weeks et al., for def’ts, resp’ts.
   Van Brunt, P. J.

This action was prosecuted to construe the will of W. J. A. Fuller and for an accounting by his executors.

The testator died on the 11th of March, 1889, leaving him surviving the defendant, E. C. Fuller, and the respondents, Kate Fuller, Fanny M. Man, Josephine 0. Krotel, Alice G. Wright, Sadie S. Fuller and Julia A Fuller, his only daughters, and the appellants, William M. and Bayard C. Fuller, his only sons. The respondents, E. A. Man and Margaret H. Man, are infants, and are the only children of said Fanny M. Man.

The respondent, E. P. Krotel, is an infant and only child of the said Josephine 0. Krotel. The appellant, Meta Fuller, is the only child of said William M. Fuller. The other daughters and the other son of the testator have no children or descendants.

He left a will dated November 28, 1888, and a codicil thereto-admitted to probate by the surrogate in April, 1889, and letters testamentary issued thereon to the plaintiffs, the executors.

After various bequests, by the ninth clause of the will the testator gave all the rest, residue and remainder of his estate to his executors in trust for the purposes thereinafter set forth. He then directs the payment of all thxes, assessments, and other lawful charges upon his estate; and that his real estate should be kept in good preservation and repair, and that it should be kept fully insured before the net income should be paid to any person under the will. He then directed his executors, after the payment of his just debts, to divide his property into as many portions as he should leave children living, not including his daughter Kate. This direction would have required the division of the estate into seven shares.

By the next clause of his will he directs his executors, during the life of his daughter Kate, to pay her $2,500 a year, which sum he had provided for in a previous clause of the will, and had directed should be deducted from the net income of the respective shares given and devised in trust. He then directed his executors during the life of his wife to pay her $3,000 a year in the same manner. He next directed his executors to pay in monthly payments to each of his remaining children who should survive him respectively, during the life of each, an equal part or share of the remaining net income of each of said respective portions or shares.

At the death of any such child, such child’s portion to go as a remainder in fee to his or her heirs.

In February, 1889, the testator published a codicil to his said will in the following language:

“ I hereby revoke and cancel such portions of my said will, bearing date November 28, 1888, as provided for my sons, William M. Fuller and Bayard G. Fuller, as beneficiaries of the trust therein created, and I hereby declare and will that the said trust shall be created and remain for the benefit of the remaining beneficiaries therein named (my wife and daughters), and the said trust estate shall be divided into as many shares as I shall leave daughters me surviving; in all other respects said trust provision s are hereby ratified and confirmed. And in lieu of the said provisions in favor of my said two sons, I hereby will and bequeath to each of them, William M. Fuller and Bayard 0. Fuller, $9,000 in bonds of the Jersey City News Company, which bonds or their equivalent, if they shall have been sold before the time of my death, shall betaken out of the said trust estate created by my said will.”

His sons have each received the $9,000 bequeathed to them.

The court below construed the will as providing that the trustees should divide the estate into five shares, being one for each daughter other than Kate, and that on the death of each daughter her share was to go to her child or children.

It is claimed upon the part of the appellant Meta Fuller, and by the appellants William M. Fuller and Bayard C. Fuller, that upon the death of her parent, William M. Fuller, she will become entitled to the same share as she would have taken under the will if there had been no codicil.

It is a cardinal rule of construction that all testamentary instruments are to be construed according to the intention of their maker; and the question presented is as to what the testator intended by the execution of the codicil which has been mentioned.

It is claimed upon the part of the appellant that no intention can be gathered from the language of the will on" the part of the testator to deprive his grandchildren of the provision which he had made for them in his original will; and if it had not been for the peculiar language of the original will in reference to the division of his estate, this agreement would have been of a very convincing character.

But upon an examination of the original will it would appear that the testator did not intend to make any provision whatever for his grandchildren unless the son or daughter, who was the parent of those children, was living at the time of his death. The provision is that the executors should divide his property into as many portions as he should leave children living; consequently if any child died prior to the death of the testator, leaving issue, such issue could not possibly inherit anything because there would be no portion whatever set aside for those grandchildren. Then the subsequent language also exhibits the same intention. He provides after the payment of the annuities that his executors shall pay in monthly payments to each of his remaining children who snail survive him respectively, during the life of each, an equal part or share of the remaining net income of each of said respective portions or shares, and that at the death of any such child such child’s portion shall go as a remainder in fee to his or her heirs. The idea that in order that a child, or its issue, should participate in the estate, it must survive the testator is set forth, and the only devise over is the child’s portion which they got under the will.

Now when we come to the codicil we find that the testator revokes such portions of his will as provided for his sons William M. and Bayard C. Fuller, and declared that the trust was to be created and maintained for the benefit of the remaining beneficiaries therein named (his wife and daughters), and that the estate should be divided into as many shares as he should leave daughters him surviving. In all other respects the trust provisions are ratified and confirmed. He then provides that in lieu of the said provisions in favor of his sons they should receive $9,000 each. The sons, therefore, have no portion in the trust estate created under the will, and, consequently, there could be no portion which will go to their children.

We are referred, however, to the rule laid down in Hard v. Ashley, 117 N. Y., 606; 28 St. Rep., 601, and Redfield v. Redfield, 126 N. Y., 466; 38 St. Rep., 516, that the will and codicil must be taken together and construed together as parts of one and the same instrument, and that the dispositions of the will should not be disturbed, unless it is necessary to give effect to the codicil.

It is to be observed here that if the effect is given to the- codicil which is claimed by the appellant, then the disposition therein attempted to be made might perhaps be absolutely void as contravening the statute, because the trust estate would have to be kept as a trust estate and the shares of the children of the sons could not descend or be ascertained until all the daughters had died, because each daughter is entitled to receive as long as she lives one-fifth of the net income óf the estate; and there would be at least six if not seven shares in remainder.

Such a result is not to be arrived at unless necessary, because a construction must be put upon the will and codicil which will give effect to all its terms rather than one which will declare any portion of it to be illegal and in contravention of law.

The eases cited are entirely different in their features from the one at bar.

In the case of Hard v. Ashley, the testator, after various devises and bequests (all termed by him bequests), among them a devise to Z. of a farm, for life, remainder to her children, gave all his residuary estate to the same parties in the same ratio and proportion as the foregoing bequests were given. By the codicil he revoked the devise to Z. and her children, and gave to her and her heirs a legacy of $8,000 in lieu and instead of said bequest, the testator having by his will fixed the value of the farm to Z. for life with remainder to her children at the sum of $15,000.

It was held that this revocation did not affect the right of Z. to a share in the residuary estate, but that the will was to be read without other change in that regard than the substitution of the amount of the legacy for the value of the farm devised, in proportioning the shares under the residuary clause.

Here it was apparent that there was no intention to disturb the residuary clause. The language of the testator was distinct. After reciting the bequest of the farm to Z. for life with remainder to the children, he says: “ I do now hereby revoke said bequest, as well the one to the children of Z. living at her death as the one to said Z., and in lieu and stead of such bequest I do hereby give to said Z. and her heirs $8,000.

■ It is clear there was no intention to deprive Z. of her interest in the residue which had been previously given.

So in the case of Redfield v. Redfield, supra, where a man had devised certain real estate to his daughters and son as joint tenants and charged the property with the payment of an annuity to his wife, which annuity was to be received by her in lieu of dower. By the codicil the testator directed that the devise be changed by striking out the names of one daughter and one son, and that it be given to the remaining daughter alone, but left it subject to the same provisions and conditions as were contained in the will, the same to be kept and performed by the legatee, and an annuity was given to the son which the legatee was required to assume and pay.

The testator made a subsequent codicil which he declared was to alter the provisions of the will and first codicil, by which he devised the premises to a daughter and son as tenants in common, and released the daughter from paying the annuity to the son which had been provided for by the first codicil. Ho reference was made to the condition imposed by the will and former codicil as to the annuity to the wife, and no other provision was made for her.

The court held that there was no exhibition of any intention to revoke the provision made for the wife in lieu of dower. And this is manifest by the fact that where he did desire to release the legatee from a charge which had been imposed by the first codicil he expressly does it by the second.

As already stated, these cases in no way support the proposition claimed by the appellants upon this appeal.

We are of opinion, therefore, that it was the clear intention of the testator by this codicil to revoke the provision which had been made for the two sons and their issue, leaving the daughters and their issue only to participate in the trust estate.

The motion for new trial should, therefore, be denied, with costs to the parties appearing to be paid out of the estate.

Daniels, J., concurs.


text:
    The Employer’s Liability Assurance Corporation, Limited, App’lt, v. The Employer’s Liability Insurance Co. of the United States, Resp’t.

      (Supreme Court, General Term, First Department,

      Filed November 13, 1891.)

    1. Trade names—Injunction.
    The words * ‘ Employer’s Liability ” being descriptive of a class of insurance business, and in common use in respect thereto, one person or corporation cannot obtain an exclusive right to use them so as to be entitled to an injunction against their use by others.
    2. Injunction—Insurance companies doing business without permission.
    Defendant, a New Jersey corporation, was refused permission to do business in this state by the superintendent of insurance on account of the similarity of its name to that of plaintiff. It, however, opened an office in New York city, and issued several policies which were filled-out in Jersey City. Plaintiff and defendant were the only companies there using similar names. Held, that the defendant being in the transaction of business in this state in defiance of our laws, any person or corporation injured by those acts had a right to maintain an action to restrain it, and that plaintiff was therefore entitled to an injunction.
    3. Same.
    The making out of policies in Jersey City on applications received in New York, and the delivery of such policies to the assured in New York, is a violation of the law, as the business is done where the policy is delivered and becomes operative.
    Appeal from judgment of the special term dismissing complaint

      W. A. Butler, for app’lt; H. Wallis, for resp’t.
   Van Brunt, P. J.

The plaintiff in this action was and is a corporation duly incorporated and existing under and by virtue of the laws of the Kingdom of Great Britain and Ireland having and exercising the power of carrying on the business of insurance. The said corporation had been in existence ever since the year 1880 and has carried on its business not only in London, England, where its principal office is established, but also in other parts of the above named kingdom and other kingdoms of Europe and Australia and in the United States since 1886.

The business of the plaintiff is the insurance of employers against liability for accidents to persons in their employ, which business it originated in 1880; and it has become greatly extended and is carried on by a large number of agents or managers of the various branches of the plaintiff’s corporations in foreign countries. The authorized capital of the plaintiff is £500,000, of which £100,000 has been paid in in cash and the available assets of the corporation amount to about £300,000.

The plaintiff has on deposit with the insurance departments of the states of New York and Massachusetts for the payment of policyholders in the United States $650,000. It has fully complied with the laws of the state of New York entitling it to do business therein and also with the laws of the other states of the United States in which it does business, and employs capital and assets on such business in the United States amounting to upwards of $840,000.

In the year 1890 the defendant was duly incorporated in the state of New Jersey under the name of the Employers’ Liability Insurance Company of the United States, and prior to the commencement of this action opened an office at No. 9 Pine street in the city of New York for the purpose of the transaction of business, and issued to persons and firms in New York forty or more policies upon applications, some of which at least, if not all, were received at their office in Pine street The defendant corporation made an application to the Department of Insurance of New York for a license to do business in the state of New York underthe name of the Employers’ Liability Insurance Co. of the United States, which was refused .upon .the ground of the similarity of name between that of the defendant and that of the plaintiff, who had already been licensed to do business within this state. The plaintiff thereupon commenced this action, claiming an exclusive right to the use of the name Employers’ Liability in connection with the insurance business, and asking that the defendant be restrained from using the said name or title. o

The defendant answered, admitting most of the foregoing facts, but denying the right of the plaintiff to the exclusive use of the term “Employers’Liability.” Upon the trial the complaint was dismissed, and from the judgment thereupon entered this appeal is taken.

We are of the opinion that the court below was correct in refusing a general injunction against the defendant in this action, prohibiting it from the use of the term “ Employers’ Liability,” upon the ground that this term is a descriptive term used generally to designate a certain well known branch of the insurance business. But it is claimed that, wholly irrespective of any question of exclusive property in the name, the plaintiff was entitled to protection against any such appropriation as would interfere with its business by inducing the public to suppose that a. new company trading under the same was the original plaintiff corporation ; that it is not necessary that fraud or evil practice should be shown; if the fact is made to appear that the use of a trade mark or corporate name lawfully possessed and enjoyed by a trading company is so used by a competitor as to deceive or mislead dealers to the prejudice of the corporation lawfully using the name, equity will protect by injunction. And our attention is called to certain cases, among which are McLean v. Fleming, 96 U. S., 245; and Goodyear Co. v. Goodyear Rubber Co., 128 id., 598. But we think that an examination of those cases is fatal to this claim. The rule is there expressly recognized that exclusive right to use a term descriptive of a character of business- cannot be acquired, and the evidence in this case shows that the term “ Employers’ Liability was in common use in respect to this class of insurance.

But the attention of the court was called by the requests to find, upon the part of the plaintiff to another branch of the case, and that was that the defendant was doing business in defiance of the prohibition of the law of the state of New York. No foreign insurance company can, nor can an agent of any such company, lawfully do business within this state until either it or he has been, duly licensed to do so by the superintendent of the insurance, department Such superintendent is authorized, for certain causes, to refuse permission to any company or association appljing to be permitted to transact the business of insurance in this state, and for other causes he is required to refuse such permission. He is required to refuse such permission when a foreign company or association proposes to, do business under a name which, in his judgment, is so nearly similar to one already in use as to lead to confusion or uncertainty on the part of the public. The defendant applied to the superintendent of the insurance department for permission to do business within the state of New York; and it is apparent from the evidence of the witness Mac-Rae (although he did at first swear that there had been no refusal and that the superintendent' did not issue the permission only because he was too busy) that such permission had been refused upon the ground of similarity of names; because as soon as he saw that there was a chance of his being confronted with the superintendent in person, he admitted that the superintendent had raised the,point that the defendant must alter its name, which it did subsequent to the commencement of this action.

The making out of policies in Jersey City upon applications received in New York, and the delivery of such policies to the assured in New York, was a clear violation of the Laws of this state. The place where the policies are written out and signed was not the place where the business was done. The business is certainly done where the policy is delivered and becomes operative, and some part of it may also be done where applications are made and accepted.

Notwithstanding the subfe 'uges resorted to by the defendant its methods were so plain a violation of our laws that it has ceased even attempting to resort to them upon the mere recommendation (as it is termed by the witness MacRae) of the superintendent of the insurance department

The defendant thus being at the time of the commencement of this action in the transaction of business in this state in defiance of our laws, any person or corporation who was in any manner injured by these unlawful acts had a right to apply to the court to prevent a continuance of the injury. It is true that the evidence on the subject of special injury in the case at bar was slight But the facts proven show that the defendant bad issued forty or more policies in New York and that the plaintiff and the defendant were the only companies using similar names; that confusion had arisen and might arise; and that the superintendent of the insurance department, because he believed that such would be the case, had refused a license to the defendant.

Under such circumstances the court will upon slight evidence of special injury, protect a party who has complied with our laws enacted for the protection of the public from an injury which has arisen from the acts of a party done in direct violation of those laws

It is true that the counsel for the respondent criticises with great severity the testimony offered upon the part of the plaintiff to show that parties had been misled by the similarity of the names of these companies But we think upon a reading of that testimony it shows that there was an evident mistake in one ease; and how many other of the persons insured by the forty policies issued in this state (we say issued in this state because they were delivered to parties in this state) were misled, we do not know, and it is not m the power of the plaintiffs to show.

The testimony of the witness MacRae in so far as it tended to sustain any claim made upon the part of the defendant whose agent and servant he was, is entirely unreliable because he evidently was willing to swear to whatever was necessary in order to protect the defendant The witness for instance is asked: “Were not you aware of the provision of law prohibiting the doing of business in Hew York by a company that has not been admitted in Hew York?” He answers, “Ho, sir; I don’t know the law exactly.”

. “Q. Had not you been informed of that law ? A. Ho.”

And yet he is the man who immediately afterwards swears that, he signed the necessary papers making the application to the insurance department for permission to do business in the state-of Hew York.

We think that under all these facts the plaintiff was entitled to-some relief, namely, to an injunction restraining the defendant from attempting to do any business within the state of Hew York.

This conclusion necessarily leads to a reversal of the judgment, appealed from and the ordering of a new trial, with costs to the appellant to abide the event

Daniels, J., concurs.