author: McAdam, J.

text:
    Siegfried Bienenstok et al., Pl’ffs, v. Edward H. Ammidown et al., Def'ts.

      (New York Superior Court, Trial Term,

      Filed May, 1894.)

    1. Sale—Fraud. •
    If an insolvent purchaser, by concealing such fact, obtains goods without intending' to pay for them, the title does not pass.

      %. Same—Intent.
    If such intent exists at the time the goods are received, it is sufficient.
    8. Same—Pursuing property.
    Where the property of another has heen wrongfully applied or converted into another species of property, it will, if its identity can be traced, be held in its new form liable to the rights of the original owner.
    4. Same.
    Where the property has been converted into money, the proceeds, with' certain limitations, may he followed just the same as the goods might have been.
    5. Same—Bona fide purchaser.
    A transfer as security for or in payment of q precedent debt, will not make the transferee a bona fide purchaser within the rule.
    S. Same—Notice.
    Where a party occupies dual or numerous positions, the knowledge acquired in one capacity is not, as a rule, imputable to the other positions.

      ‘7. Same.
    But the rule of imputed knowledge should not be so limited, where the knowledge or notice was present in the mind of the agent at the time of the transaction in question.
    3. Same.
    Where circumstances are such as to put a person upon his inquiry, he is chargeable with every knowledge which the inquiry would have disclosed, if it had been properly followed up.
    Trial by the court without a jury.

      Blumenstiel & Hirsch, for pl’ffs; MacFarland & Parian, for deft Smith.
   McAdam, J.

The plaintiffs, wool dealers at St. Louis, Mo., in September, 1890, sold to a corporation known as the Bittenhouse Manufacturing Company, located at Passaic, Kew Jersey, a quantity of wool, aggregating in value about $34,888.17. The transaction, on the part of the Bittenhouse Company, was conducted by Mr. Gardner, its manager, • through a firm of wool brokers, known as Salter Brothers. Mr. Ammidown, one of the defendants, was president of the Bittenhouse Manufacturing Company, and at the same time senior member of the firm of Ammidown & Smith, composed of the defendants. Ammidown owned about ninety per cent, of the stock of the Bittenhouse Company, and had an interest to the extent of sixty per cent, in the firm of Ammidown & Smith.

About the time the wool reached Passaic Mr. Ammidown told Gardner that the wool must be sent to Kew York and placed in warehouses; that times were hard, ready money tight and difficult to get; that the notes of the corporation could not be sold, and lie would have to borrow money on the wool for present use. For these reasons the wool was not taken from the cars, but- brought to New York, divided into three parcels, stored, and warehouse certificates procured in the name of the Bittenhouse Manufacturing Company. These three warehouse receipts were thereupon taken to the Bank of America and two other similar institutions, where the notes of the Bittenhouse Company, guaranteed by Ammidown and secured by these warehouse receipts, were discounted. The proceeds of the Bank of America discount, amounting to $9,200, were represented in a check drawn by that bank, indorsed first by Ammidown, then by his firm of Ammidown &” Smith, and passed to their credit in their bank.

Plaintiffs claim that their property was obtained by the Bitten - house Manufacturing Company by means of a fraud, to which Ammidown was a party, and that, in consequence, they have the right to follow the proceeds of the $9,200 draft, representing part of their property, into the hands of the defendants.

That the property was .obtained by fraud may be safely inferred from the evidence. The Bittenhouse Company, at the time it bought the wool, .was á corporation created by the laws of New Jersey, having a capital of $200,000. Three months before the wool was purchased, the books of the corporation showed a deficiency of $329,000, and on December 2, 1890, it was behind to the extent of $555,000; so that it was hopelessly insolvent, without the slightest prospect of continuing business’ or of meeting its .obligations. The wools purchased from the plaintiffs were evidently bought with the pre-conceived design not to pay for them. The circumstances overcome every presumption of innocence. The embarrassed condition of tiie Bittenhouse Company and of Ammidown, and the use they made of the plaintiffs’ wools, show that the intention of paying for them ' was never for a moment entertained. Indeed, payment therefor was impossible.

In Durell v. Haley, 1 Paige R., 492, Chancellor Walworth said : “If a purchaser who is insolvent conceals the fact from the vendor, and thus obtains goods without intending to pay for them, it is a fraud, and the property is npt changed in the hands of the vendee.” The same doctrine is asserted in Ash v. Putnam, 1 Hill, 302; Buckley v. Artcher, 21 Barb., 585; Morrison v. Garner, 7 Abb. Pr., 425; Devoe v. Brandt, 53 N. Y. 462; Johnson v. Monell, 2 Abb. Ct. App. Dec. 470; 2 Keyes, 655; Wright v. Brown, 67 N. Y. 1; Anonymous, Ib. 598.

It is sufficient if the intent exist at the time the goods are received, 'though subsequent to the sale. Whitten v. Fitzwater, 129 N. Y. 626; 41 St. Rep. 379. The combination of events is to be considered in determining the question. See Beardsley v. Duntley, 69 N. Y. 581; Hedges v. Payne, 44 St. Rep. 165 ; Abegg v. Schwab, 31 St. Rep. 139 ; 9 N. Y. Supp. 681; White v. Benjamin, 3 Misc. R. 505, 506.

It is not necessary for the evidence to show beyond a reasonable doubt that a party is guilty of fraud; nothing more is required than that the evidence shall be sufficient to satisfy the conscience of a common man, although the evidence does not. amount to absolute certainty. Bigelow on Fraud, 474, 475.

The Ritteuliouse Company and Aminidown knew that the plaintiffs were supplying the wool, believing that it was to be used at the company’s mills; that it was needed there, and that they were doing, and likely to continue to do, a prosperous and paying business; and all intimation to the. contrary was carefully suppressed. It must have been known that if the plaintiff's had the faintest idea of the hopeless insolvency of the Ritteuliouse Company, or of Ammidown, they would not have parted with over $34,000 of their property, particularly if it had been suspected that, instead of using the wools at their mills for manufacturing purposes, in the usual course of business, the vendees intended, as soon as they received the wools, to put them in storage with the sole object of raising their value in money for the benefit of others—a course which destroyed all possibility of payment to the vendors. If the plan which was carried out successfully was not preconceived, the result and consequences to the vendors were just the same, and as between them and the vendees the former might have rescinded the sale and reclaimed the property. Nichols v. Michaels, 23 N. Y. at p. 266. Vide cases before cited.

A bona fide purchaser from a fraudulent vendee will be protected, however. Bell v. Shell, 21 Wend. 222; Mowrey v. Walsh, 8 Cow. 238; Keyser v. Harbeck, 3 Duer, 341; Fassett v. Smith, 23 N. Y. 252; Paddon v. Taylor, 44 N. Y. 371. But it devolves upon the latter to establish that he is a bona fide purchaser, and that he has parted with value without notice of the fraudulent title of the person from whom he got the property. Porter v. Davis, 49 N. Y. 566; Stevens v. Brennan, 79 N. Y. 254; Dows v. Kidder, 84 N. Y. 12; Meecham v. Collignon, 7 Daly 402; Mather v. Freelove, 3 St. Rep. 424. A transfer as security for or in payment of a precedent debt will not make the transferee a bona fide purchaser within the rule. Stevens v. Brennan, and other cases, supra.

Wherever the property of another has been wrongfully misapplied, or a trust fund has been wrongfully converted into another species of property, if its identity can be traced, it will be held in its new form liable to the rights of the original owner. 2 Story’s Eq. §§ 1265, 1258.

Equity impresses a trust upon it in favor of the one equitably entitled to the same against anyone receiving the fund but a purchaser in good faith and without notice. 2 Pom. Eq. §§ 1048, 1053; Perry on Trusts, § 166. The product or substitute for the original thing still follows the nature of the thing itself, so long as it can be ascertained to be such, and the light only ceases when the means of ascertainment fail. Taylor v. Plummer, 3 Maul. & S. 562; Cavin v. Gleason, 105 N. Y. 256; 7 St. Rep. 13; Bank v. King, 57 Penn. St. R. 302; Bank v. Ins. Co., 104 U. S. 69; Ferris v. Van Vechten, 73 N. Y. 113. Where the property has been converted into money such proceeds may (with certain limitations hereinafter referred to) be followed just the same as the goods might have been. Dows v. Kidder, 84 N. Y. 121; Van Alen v. Am. Nat. Bank, 52 N. Y. 1; Holmes v. Gilman, 138 N. Y. 369 ; 52 St. Rep. 873; 30 Abb. N. C. 212.

The Bank of America, in good faith and without notice, advanced upon the warehouse receipts $9,200, and to-that extent acquired a valid lien thereon, and the question is whether the defendants herein acquired, as against the plaintiffs, any right to retain the proceeds, which went into their hands in the form of a check' drawn by the bank, which was indorsed, first by Ammidown, next by his firm, and deposited to their credit in the Importers & Traders’ Bank. , Up to the time the check Was in Ammidown’s hands, as president of the Rittenhouse Company, and so long as it remained there, the proceeds could have been recovered from him by the plaintiffs. If the title of the firm of Ammidown & Smith is affected in like manner, there is no defense, and the decision of this question depends to a large extent upon whether the knowledge of Ammidown is to be imputed to his copartner Smith, and so to the firm of which he was a member ; for if it is, it becomes evident that that firm cannot receive the protection accorded to bona fide transferees of property.

In this connection it must be conceded that where a party occupies a dual position, or numerous positions, such as president of one company, treasurer of another, secretary of a third, and member of a firm, the knowledge acquired in one capacity is not, as a rule, imputable to the other concerns to which such knowledge does not, by the position occupied, rightfully belong. Therefore, the knowledge that Ammidown acquired while acting as president of the Rittenhouse Manufacturing Company, did not necessarily charge Smith, his copartner, who was in a legal sense a stranger to the Rittenhouse Manufacturing Company, and not bound to know the facts connected with its business. Ammidown was under no obligation- to make these facts known to Smith, and it will not be inferred that he communicated them to him.

But the transaction did not stand alone. Ammidown & Smith were the consignees of the Rittenhouse Manufacturing Company, having an arrangement with it by which all its manufactured goods came to their firm, under an agreement by which théy- were to advance 75 per cent, of the market value. These advances had been made from time to "time, covering a period of years, going-back as far as 1883. So that, at the time when the plaintiffs’ wools were received the Rittenhousq Manufacturing Company owed Ammidown & Smith, for over-drafts on consignments, a sum aggregating about $276,000. Smith knew the financial condition of the Rittenhouse Company and, indeed, had for a long time suspected its, stability; so that he refused to have his firm make advances unless Ammidown personally guaranteed every payment. This Ammidown did. Hence, Smith was chargeable with the knowledge which his different relations to the transaction gave him, and to such as may be reasonably inferred from the action of the firm as such.

True, Smith had no pei-sonal knowledge concerning the purchase, storage or pledging of the plaintiffs’ wools, and if the proceeds of the check from the Bank of America had not been passed to the firm’s credit no liability would have attached to the defendants jointly. But Ammidown brought the check into the firm and it was deposited to the firm’s credit. Did the firm by this act become chargeable with Amrnidown’s knowledge of the transaction that put it there ? In taking advantage of Ammidown’s act of bringing in the check, the firm of Ammidown & Smith took it impressed with his knowledge as to the source from which it came, even though such knowledge was not acquired in the course of his agency as a member of the firm. Constant v. University of Rochester, 111 N. Y. 604; 20 St. Rep. 211.

The defendants claim that payifig in the check of the Bank of America was the official act of Ammidown as the president of the Rittenhouse Company, and thaf the payment imputed no knowledge to his firm, further than the fact of payment But Ammidown did more; he acted for his firm in receiving the money and putting it in the Importers and Traders’ Bank to its credit, and by this act he associated his firm with the transaction by making it the beneficiaries thereof. It cannot be that the same person can, as a corporation president, commit a fraud on the public, and immediately thereafter, by his own act, give a firm of which he is a member the benefit of it, and in that simple manner make the fruits of the fraud safe from legal accountability. There must be some well defined boundary line drawn where the acts of the same person, in the same capacity, for legal purposes stop, and those in the other commence; where the doctrine of imputed knowledge in the new concern succeeds the actual knowledge gained in the former. It was at one time held that notice to the agent, in order to bind his principal by constructive notice, must be in the same transaction. But the court,, in Constant v. The University of Rochester, supra, held that the rule should not be so limited, when clear proof is made that the knowledge or notice “was present in the mind of the agent at the time.of the transaction in question.”

The wools were purchased on September 10th; they were put in the warehouses on September 24th, were pledged September 26th, and on the same day the money was turned over to his firm by Ammidown; so that, under the test applied in the Constant case, the details of the entire transaction were present ,in Ammidown’s mind when his firm became a party to it. Ammidown was the senior member of the firm, directing its affairs and controlling its course, and held out by the firm as worthy of confidence. There are equitable reasons, therefore, why the rule as to imputed knowledge should be applied to the defendants’ firm in furtherance Of justice.

In Holden v. N. Y. & Erie Bank, 72 N. Y. 286, it was held that where the agency was continuous and made up of a long series of transactions of the same general character, knowledge acquired by the agent in one or more of the transactions is notice to the agent and the principal, which will affect the latter in any other transaction in which the agent, as such, is engaged and in which the knowledge is material.

The application of the doctrine of imputed notice is all important in this case, because the check of the bank, being negotiable like money, was passed to the credit of the Rittenhouse Company as payment pro tanto of its indebtedness, and if so applied in good faith, without notice or anything to put the firm as such on inquiry, that act alone was sufficient to vest title to the money in the defendants. Stephens v. Board, 79 N. Y. 183; Justh v. Nat. Bank, 56 N. Y. 478 ; and see Southwich v. First Nat. Bank, 84 N. Y. 420; Newhall v. Wyatt, 139 N. Y. 452; 54 St. Rep. 708. And this upon the ground that money is currency—has no ear marks—that its possession vests title in the holder, as to third persons dealing with him and receiving it in due course of business and in good faith, even in payment of a precedent account.

The defendants go further than the making of the ordinary bookkeeping entries, and show that the firm not only kept the usual ledger account with the Rittenhouse Company, on which the draft was credited to it, but had added thereto a system of entries in what is called the “ advance book," which was kept for the information of the Rittenhouse Manufacturing Company, that it might know to what extent it could draw against the firm of Ammidown & Smith. . It had been arranged before this that, after drawing the 75 per cent, of the market value of the goods consigned to Ammidown & Smith, the other 25 per cent, was to go in reduction of the debt of that company to the firm. Smith claims that when the proceeds of these drafts were received they were put on the advance book in the form of-a credit to the Rittenhouse Company, and that the company drew upon Ammidown & Smith, not only for the 75 per cent, which they were allowed to draw under the agreement, but for th§ proceeds of these discounts as well; that in this manner the proceeds were turned- over to the company before any notice of the plaintiffs’ claim, and that by such turning over, Smith, as a.member of the firm, and Ammidown & Smith as a firm, derived no benefit or profit whateyer from the proceeds of the discounts, and are, therefore, not chargeable in respect thereto.

While there is force in this circumstance—sufficient almost to warrant a finding of good faith on the part of the firm as a firm— it must be deemed controlled by Smith’s actual knowledge of the insolvency of the Rittenhouse Company, and imputed knowledge of the fact that the proceeds were from discounts made on warehouse receipts for wool fraudulently purchased from the plaintiffs, which had not been paid for; and this knowledge destroyed all right to protection in behalf of the firm as bona fide transferees.

If Smith did not- acquire full knowledge on the subject, he had sufficient notice to put him upon inquiry, and the rule is that where circumstances are such as to put a person upon his inquiry, he is chargeable with every knowledge which the inquiry would have disclosed if it had been properly followed up. Williamson v. Brown, 15 N. Y. 364. Failure to follow a reasonable clue is “ such gross negligence as would be a cloak for fraud if permitted, and it must be held to amount to constructive notice." Whitbread v. Jordan, 1 You. & C. Eq. 303. And “when a party having knowledge of such facts as would lead any honest man, using ordinary caution, to make further inquiries, does not make, but, on the contrary, studiously avoids making such obvious inquiries, he must be taken to have notice of those facts which, if he had used such ordinary diligence, he would readily have ascertained. Ib. 328; and see Wright v. Cabot, 89 N. Y. 570; Edwards v. Dooley, 120 N. Y. 553; 31 St. Rep. 710.

If Smith chose to remain ignorant in regard to matters about which he might have informed himself, that was his right; but he cannot put the consequences upon others, and must be held, so far as they are concerned, to be chargeable with the knowledge which inquiries properly pursued would have revealed. These inquiries, if made, would have disclosed the true state of facts before detailed, and would have left him with his partner’s knowledge of the fact that the proceeds of the wool equitably belonged to the defrauded owners of the wool from which the proceeds came.

Under these circumstances the defendants are chargeable with the amount of the proceeds, $9,242,44, with interest, aggregating $11,178, and for this aum, with $250 allowance, the plaintiffs are entitled to judgment.


source: Caselaw Access Project

author: Smith, J.

license: Public Domain

text:
    Fannie P. Cottle et al., App’lts, v. Eliza Sullivan, Resp’t.

      (Buffalo Superior Court, General Term,

      Filed May, 1894.)

    Summary proceedings—Condition-
    Where, by the terms of a lease, the service of a notice, at the election of the lessor, to terminate it in case of certain action on the part of the lessee, and the expiration of the time fixed by it were to have the same effect as if that was the expiration of the original term of the lease, such service authorizes the maintenance of summary proceedings to remove the teii&nt under § 2231 of the Code.
    Appeal from an order of the municipal court of Buffalo dismissing the appellants’ petition in summary proceedings to remove a tenant holding over after the expiration of the term.

      Seaver & Marcy, for app’lts; Tabor & Sheehan, for resp’t.
   Smith, J.

After issue joined upon the appellants’ petition and the respondent’s answer, and a jury had been impaneled to try the issue in the court below, the judge, upon respondent’s motion, refused to hear any evidence, though the petitioners offered to prove every allegation of their petition, and rendered judgment in favor of the respondent dismissing the petition with costs. The return shows that the judgm'ent was rendered upon the sole ground that the petition did not show any termination or expiration of the term created by the lease from the petitioners to the respondent.

For the purposes of this appeal, we may assume that the petition contained all the other allegations that were necessary under the statute to entitle the petitioners to the final order of removal asked for; a copy of the lease between tli.e parties is annexed to and made a part of the petition. It contains a covenant (among others) that if the lessee (the respondent here) should use the de" raised premises, or any part thereof, for any other purpose than living rooms for herself and, family, to be kept in a respectable manner, then the lessors should have the right at their election to terminate the lease by giving to the lessee three days notice of such election, to be served personally, and that the. term created by the lease should “ thereupon cease at the expiration of the said-three days in the same manner and to the same effect as if that were the expiration of the original term of this lease.” The petition by apt and proper allegations shows that during the term and prior to September 11, 1884, the respondent committed a breach of the covenant above set forth; that on the day last named the appellants served upon the respondent personally a notice in writing that they elected to terminate the lease at the end of three days from the service of the notice, because of the breach of said covenant, and that the respondent held over and continued in possession of the premises after the expiration of the term thus produced without the permission of the petitioners. The petition was verified and presented to the court below, and the precept in this proceeding issued thereon on the 16th of September, 1884. There can be no doubt, therefore, that according to the express terms of the covenant and agreement contained in the lease, the term created thereby expired on the 14th of September, two days before the precept issued, if the allegations of the petition were true, and the decision of the court below was clearly erroneous, unless it can be upheld by a construction of the statute that excludes this and like cases from, its operation.

Section 2231 of the Code of Civil Procedure provides that a tenant or lessee holding under such a lease as that in question may be removed by summary proceedings “ where he holds over and continues in possessiqn of the demised premises, or any portióh thereof, after the expiration of his term without the permission of the landlord.” The language of the section is essentially the same as that of the Revised Statutes under which the causes to which I am about to refer arose.

In Oakley v. Schoonmaker, 15 Wend. 226, the supreme court decided that the breach of a covenant or agreement in a lease to cut no wood or timber on the premises except for fencing, and to carry off no wood or timber, does not create such an expiration of the term as will authorize summary proceedings under the statute to remove the tenant.

And in Beach v. Nixon, 9. N. Y. 35, the court of appeals held that the breach of a covenant by the lessee that he will not permit the premises to be used for a purpose deemed extra hazardous, and that in case of such use the lease shall cease and determine at the option of the lessor, and that he may thereupon recover immediate possession undeivthe statute in question, does not create such an expiration of the lease as the statute contemplates and intends. • - .

In the two cases above cited, the theory upon which, the landlord proceeded was that the tenant’s breach ofhis covenant worked a forfeiture of the term so that the landlord might at any time reenter and put the tenant out, and, therefore, the term had, in contemplation of the law,'expired, and the tenant was holding over. But the courts held-that, the covenants in the lease created a condition merely and not a conditional limitation of the term. The relation of landlord and tenant did not cease, nor, of course, did the term cease upon the breach of the covenant, but only when the landlord elected to treat the breach as having created a forfeiture ; apd there was but one way in which he could manifest such election, and that was by an actual re-entry. 2 Greenl. Cruise Real Prop., chap. 2, tit. 13, § 39; Wash. Real Prop., 473: Duryee v. Mayor, etc., 96 N. Y. 477, 496, 497. Until such reentry the term continued and the tenant did. not hold over. And § 2135 of Crabb’s Law of Real Property was quoted with approbation, as follows: “Where an estate is so expressly limited by the words of its creation that it cannot endure for any longer time than until the contingency happens upon which the estate is to fail, this is a limitation. On the other hand, where an estate is expressly granted upon condition in deed, the law permits it to endure beyond the time of the contingency happening unless the grantor takes advantage of the breach of condition by making entry.” What will constitute a conditional limitation of the term is illustrated by the case of Miller v. Levi, 44 N. Y. 489, which, in its essential features, is not to be distinguished from the one now under consideration. The lease from Miller, the landlord, to Levi, the tenant, was of a' store on Main street in this city for the term of four years from May 1, 1862, but with a condition in these words, with the privilege reserved to terminate this lease at the end of any year by giving sixty days previous notice, in case the landlord should sell or desire to rebuild.” Miller sold the- demised premises in January, 1864, and on February 12,1864, gave notice that he had sold the premises and should terminate the lease on May 1, 1864, pursuant to the right so reserved in the lease; Levi held over and continued in possession of the premises without the permission of Miller, who, on May 2,1864, instituted proceedings for the removal of Levi under the statute we are considering. After trial, upon issues joined before the officer who issued the summons, and an order made for the removal of the tenant, the case was removed into this court by certiorari, and the order was affirmed by the general term, and thereupon an appeal was taken to thei court of appeals, where the judgment of this court was affirmed. The courts held that the agreement in the lease that the lessor might, in case of a sale, terminate the lease by a notice of sixty days was a conditional limitation of the term, and when the notice was given and the time specified therein had run, the term ipso facto expired. The limitation operated to extinguish the term without entry or any further act by the landlord. And that is precisely the operation of the agreement in the lease in the case now before ns. The petitioners did not, as did the lessors in the cases of Beach v. Nixon, 9 N. Y. 35, and Oakley v. Schoonmaker, 15 Wend. 226, rest their claim that the term had expired upon the forfeiture created by the broken covenant, but upon the express limitation annexed to the covenant in -the lease, that when the breach occurred and the landlord gave notice electing to terminate the lease, the term should cease absolutely at the expiration of the term fixed by the notice. In the language of the lease the service of the notice, and the expiration of the time fixed by it, were to have the same “ effect as if that were the expiration of the original term of the lease.” Those acts created the expiration of the term. No re-entry or other act of respondents was necessary. In the case of Miller v. Levi the expiration of th,e term was declared to be absolute upon the sale of the premises and expiration of the sixty days’ notice served by the landlord. So, in this case, the breach of the covenant, and the service of the notice of the termination of the lease in three days by the petitioners, caused. an absolute expiration of the term at the end of the three days. That was the legal effect of the acts of the parties, and not only so, but they expressly agreed that such should be their legal effect. It is no hardship to respondent to compel her to abide by her agreement by which she declared what acts should operate to terminate the lease, and so hold it terminated according to the agreement

It follows from these views that the order and judgment appealed from were erroneous and must be reversed, with costs.

. Sheldon, Ch. J., and Beckwith, J., concur.

Order and judgment reversed, with costs.


author: Davie, S.

text:
    In the Matter of the Estate of Rachel M. Spencer, Deceased.

      (Surrogate’s Court, Cattaraugus County,

      Filed May, 1894.)

    1. Executors, etc.—Legacies.—Abatement.
    Where real and personal property are blended together by the terms of the will, rendering them both liable for the payment of legacies pari passu, the general legacies do not abate proportionately in consequence of the insufficiency of the personal estate to pay them in full.

      % Same—Power oe sale.
    The executor is empowered by the terms of the will to sell and convey the real estate, where he is appointed with full power to sell all the testator’s property, if necessary, to fulfil a Request. .
    Proceedings upon intermediate accounting and for a construction of the will of deceased.

      W. K. Harrison, for executors, legatees and guardian cal litem; John L. Murphy, general guardian of residuary legatee, in person.
   Davie, S.

The testatrix died on tile 29th day of December, T892, leaving a will bearing date on the twenty-first day of the same month, which'was admitted to probate on the 6th day of February, 1893, and letters testamentary thereupon issued to James L. West, executor.

By the terms of the will testatrix directed the payment of her debts, funeral charges and expenses of administration, and bequeathed the sum of $200 to one sister, and $100 to each of two other sisters; then follows a. bequest of $200-to Nellie O’Dell, a niece; $100 to Spencer Quackenbush, a nephew, and $50 to each of six other nieces and nephews. She then directs hermxecu-. tor to retain the sum of $200 out of her estate, invest the same and expend the interest arising from such investment in keeping her cemetery lot in good condition, and further provided that “if it is not necessary to expend the whole amount of the interest on my lot in said cemetery, then the balance to be used in beautifying and in keeping the cemetery in good condition, as the proprietors of said cemetery may direct.” The final disposing clause of the will is as follows: “All the rest and residue of all my property, both real and personal, I give and bequeath to Ella Quaclcenbush, absolutely; likewise, I make, constitute and appoint James L. West, with full power to sell all my property, if necessary to, to fulfill my above bequest, executor,” etc.

It appears from the account filed that the personal estate of testatrix remaining after the payment of the debts, funeral expenses and costs of administration is but little more than half enough to pay the general legacies, and the questions now presented for determination are: First, must the general legacies abate proportionately in consequence of the insufficiency of the personal estate to pay them in full, or can resort be bad to the real estate for full satisfaction of the same; and, second, is the executor empowered by the terms of the will to sell and convey the real estate ?

The personalty is not only the primary fund, but the only one liable for the payment of the general legacies unless they-are charged on "the realty by express direction, or by necessary implication ; such a charge, however, may operate in aid of the personalty, furnishing an additional fund for the payment of legacies upon exhaustion of the personalty, or where the two species of property are blended together by the terms of the will, rendering them both liable for payment of legacies pari passu. 13 Am. & Eng. Ency. of Law, 110.

It will be observed that the residuary clause of the will deals with both the real and personal estate alike; the courts of this state, after much vacillation, appear now to take the position that this blending of the real and personal estate in the residuary clause is not sufficient in and of itself to charge the realty, yet it is a circumstance to be taken into consideration in ascertaining the testator’s intention, and in connection with other circumstances may be controlling. Hoyt v. Hoyt, 85 N. Y. 142; Scott v. Stebbins, 91 id. 605; McCorn v. McCorn, 100 id. 511; Anderson v. Davison, 42 Hun, 431; 5 St. Rep. 48.

A charge will also be implied if the language of the will - indicates that the testator intended the legacies to be paid in full, knowing that her personal property was insufficient for that purpose, or if it appears that she had her real estate in mind when determining the amount of her various bequests, although such real estate be devised, Le Fevre v. Toole, 84 N. Y. 95; McCorn v. McCorn, 100 id. 511; and extraneous circnmstanoes may be considered in aid of the terms of the will. Brill v. Wright, 112 N. Y. 134; 20 St. Rep. 305.

In the case at bar the will was made only a few days prior to the death of the testatrix • hence no change occurred in the condition of her estate between the execution of the will and her death; her estate, aside from the real estate and a small amount of household furniture and wearing apparel, consisted of money securities; testatrix was a woman of ordinary sagacity and business ability, and must be presumed to have comprehended the extent of her personal estate at the time of the execution of the will; the principal legatees are her sisters, while the residuary legatee is a niece, and there is nothing in'the situation of the parties, as disclosed by the evidence, showing that this niece had any gi-eater claim upon the bounty of the’testatrix than -her other relatives, especially her sisters; the claim that testatrix designed that the payment of the general legacies should he limited by the amount of the personal property is simply an imputation that the testatrix, desiring in view of her approaching death to make some fair and reasonable disposition of her estate, designedly and intentionally incorporated in her will a series of legacies which were to a great extent meaningless and valueless; it seems much more reasonable to suppose that testatrix intended that the general legacies should Erst be paid in full, and that whatever might remain should go to the. residuary legatee ; there is nothing in this conclusion inconsistent to any extent with the phraseology of the will, and it is sustained fully and satisfactorily by the proof of the circumstances attending the execution of the will.

Having reachad the conclusion that testatrix designed to make the general legacies a charge upon her real estate in so far as the personal estate was insufficient to pay them, her further intention to clothe her executor with ample authority to carry out the provisions of the will by a disposition of all her estate is equally apparent ; the terms of the will are entirely susceptible of that construction ; she designates and appoints an executor “ with full power to sell all my property, if necessary to, to fulfill my above bequests; ” the will is not very artistically drawn, but the carelessness of the scrivener cannot be permitted to defeat the evident intention of the testatrix. Where upon examination of a will taken as a whole the intention of the testator appears clear, but its plain and definite purposes are endangered by inapt or inaccurate modes of expression, the court may, and it is its duty, to subordinate the language to the intention. Phillips v. Davies, 92 N. Y. 204.

It must be held in this case that the executor is clothed with ample authority to sell the real estate of testatrix and convert the same into money; that he should do so in the course of his administration, and out of the proceeds arising from the sale of the personal and real estate pay the general legacies, and the residue, whatever it may be determined to be upon judicial settlement, to the residuary legatees.

A decree will be entered accordingly.


author: Coffin, S.

text:
    In the Matter of the Application to Revoke Letters of Administration with the Will Annexed, Issued to T. Chesley Richardson et al.

      (Surrogate’s Court, Westchester County,

      Filed April, 1894.)

    1. Executors—Removal.
    A person, who has not qualified as executor, cannot resign, or be removed, from such position.
    2. Same—Citation.
    A residuary legatee, on applying for letters of administration with the will annexed, is not bound to cite any one.
    The testator died in 1865, and his will was proved in this county the same year, disposing of a large estate. By the will he provided that the executors or administrators of the survivor of two executors and trustees appointed by him should have the power to appoint an executor and trustee in their place. His wife, the survivor of the two named in his will, died in January, 1890, leaving a will, by which she nominated her son, T. Chesley Richardson, and John Mulligan executors thereof, and they appointed said T. Chesley Richardson executor and' trustee of Thomas Richardson’s will. Thereupon, on their petition and that of Anna P. R. Kirkland, a daughter of Thomas Richardson, deceased, an order was entered appointing safd T. Chesley Richardson such executor and trustee. Subsequently an accounting was had as to his proceedings, wherein it was found that some irregularities had been committed by him in the use of the funds of the estate, but no loss resulted to the estate. Other accountings followed, until at length Mrs. Kirkland applied to have him removed as executor and trustee. He then applied for leave to resign, rendered his account, and on December 20, 1893, an order was entered removing him, and permitting him to resign on complying with the provisions of the decree, and delivering to the New York Life Insurance & Trust Company, his successor as trustee, all the securities and money then in his hands, with which he complied. On the 5th day of January, 1894, he, being a residuary legatee under the original will, obtained letters of administration with the will annexed, in which James H. Moran was duly joined with him, giving the usual bonds. Now Mrs. Kirkland has made an application to have these letters revoked, mainly on grounds of misconduct disclosed on his first accounting.

      Clarice & Culver, for motion ; F. X. Donoghue and S. E. Dvffey, opposed. ■
   Coffin, S.

It is a curious fact and a matter of considerable moment in this case that T. Chesley Richardson never became a legally constituted executor of the will of Thomas Richardson, deceased, but has been regarded and treated as such. An order was made sanctioning his appointment by the executors of his mother’s will, but he never qualified or received letters as such. He could not legally act as executor any more than if he had been -named executor in his father’s will and failed to qualify. He was simply executor de son tort, and subject to all the consequences flowing from that relation.

■ Section 2594 of the Code provides "that before letters testamentary shall be issued to a person named as executor, he shall take the oath of office as therein prescribed. As has been already stated, this has not been done, nor letters issued. Thus, the liability of Mr. Richardson should have been sought to be established under § 2706, not inserted in the Code until 1893,- but which is as old as the Revised Laws of 1813. See also, 2 R. S. 81, § 60; Id. 449, § 17. It also appears by the findings of fact and conclusions of law made in, the first accounting, dated July 7, 1893, prepared by Mrs. Kirkland’s counsel, that the trust under the will was acknowledged by her to have been terminated in so far as she was concerned, and yet she subsequently applied' to this court to have him removed in both capacities. It is quite plain that not only on that accounting, but in all subsequent proceedings no jurisdiction was obtained or existed to deal with him as an executor, and the trust, according to the findings, having1 been executed as to her, there was no sufficient basis for any action, in that respect, on her part. Nevertheless, all decrees and directions of this court, however futile, have been complied with by the so-called executor and trustee, and the estate has suffered no loss or injury by any act of his. Ah the material facts stated as grounds for the revocation of his present letters of administration with the will annexed were furnished by the testimony of himself on the first accounting, and, if we are allowed to regard them here, disclose no intended wrong, but rather a misconception of the rights, duties and powers of an executor. They alone would not seem to justify a revocation of letters testamentary had they ever been issued to him.

The singular order for the removal and acceptance of the resignation of Richardson, as executor, when he was not such, was entered by consent and was a nullity. No court could remove a person from an office he had never held, nor revoke letters which, had never been issued, nor accept a resignation from such office. And as to his removal as trustee, it had been conceded by the petitioner here that the trust* had been executed, and there was, therefore, and could be no cause for his removal. He could not he removed from an office which he had fully executed, nor resign from one he had never held, as above stated.

I have examined the cases of Suarez, 3 Dem. 164; Matter of Dearing, 4 id. 81; Matter of Beakes, 5 id. 128, cited by the learned counsel for petitioner, and find that all of them rélate to cases where the executors had qualified. Doubtless, none similar to this can be found. Here a resigned office has not been allowed to be resumed.

It is alleged that the letters of administration -vyere obtained by a false suggestion of a material fact, to wit, that the petitioner concealed the fact that he had acted as executor and trustee and been removed and had resigned. There seems to be no force in this allegation under the circumstances already stated. The petition was in the ordinary and usual form, and there was no occasion to make such a statement had it been true.

Another objection is that Mrs. Kirkland had no notice of the application for the letters. He was a residuary legatee, and where such a person applies he is bound, under § 2644 of the Code, to cite no one. It is only where a person having a subordinate right petitions that he must cite those having a prior one, and residuary legatees have the first right.

Letters of administration with the will annexed having been duly issued to Eichardson, with Moran joined with him, and they having given satisfactory bonds with proper sureties, no sufficient reason is discovered, under all the remarkable and somewhat complex circumstances, for their revocation.

Application denied, with costs.


text:
    In the Matter of the Collateral Inheritance on the Estate of Louisa S. Platt, Deceased.

      Surrogate’s Court, Westchester County,

      Filed April, 1894.

    Tax—Collateral ixiieritance—Penalty.
    Relief from the penalty for non-payment of the collateral inheritance tax will not be granted on the grounds solely that the executors were ignorant of the law, and that such payment will be a hardship on the legatee.
    Henry W. Bibby, one of the executors, etc., of the deceased, presents a petition, in which it appears that the testatrix died on the 20th day of February, 1889; that by her will she bequeathed the use of the residuum of her estate to her neice, Augusta Bibby, during her life, and upon her death, leaving her daughter, Mary Bibby, surviving, then the like use for life to said Mary, and at her death the fund was bequeathed to others; that the executors rendered their account and a decree was entered on the 6th day of February, 1891, fixing such residuum at $31,261.91: that the executors were.ignorant of the law relating to the tax; that in' 1894 a decree was made fixing the tax upon the estate of Augusta Bibby at $691.25, and on that of Mary Bibby at $517.50; that thereupon the amount of the taxes, so fixed, was tendered to the county treasurer, which was refused unless a penalty of ten per cent, amounting to more than $600, was paid thereon; that the executors have no funds, other than said residuum, out of which to pay said taxes and penalties, and that Augusta Bibby is sixty years of age, without other property, and is wholly dependent for her support upon the slender income from said trust fund, which is barely sufficient for the purpose, and prays for an order relieving the estate from the payment of any penalty.

      Strong & Cadwalader, for motion; John Hoag, County Treasurer} in person, opposed.
   Coffin, S.

By § 15 of the act of 1887 it is provided that the surrogate’s court of the proper county shall have jurisdiction to hear and determine all questions in relation to the tax arising under the provisions of that act. Here, such a question having arisen, it is proper for this court to determine it, the county treasurer having no judicial .power on the subject. His duty is doubtless to demand the penalty of ten per cent, in this case, and it is a fair question as' to whether or not the liability exists. It might bo that facts could be shown which, under theprovisions of § 5, would relieve the estate from liability for the penalty. These facts should be adjudicated where the question arises by the court.

However much hardship to persons may spring from the exaction of the penalty in this or any other case, yet the provisions of the statute must be enforced. No reason is furnished here other than such hardship resulting from ignorance of the law. It is an old legal maxim that ignorantia legis neminem excusat.

The application, therefore, is denied.


author: Pryor, J.

text:
    Chaim Lechowitzer, Resp’t, v. The Hamburg American Packet Company, App’lt.

      (New York Common Pleas, General Term,

      Filed May, 1894.)

    1. Oakmeii—Exemption.
    The contract for carriage is consummated when the passenger pays, and the carrier accepts, the fare.
    2. Same.
    Where no terms of acceptance are then agreed upon, the law prescribes the conditions of carriage.
    3. Same.
    Any subsequent assent, even though express, to a limitation of liability is without consideration and, therefore, nugatory.
    Appeal from judgment of general term', city court, affirming judgment on verdict.
    The opinion states the case.

      Everett P. Wheeler, for app’lt; Nicholas Aleinihoff, for resp’t.

       Affirming, 57 St. Rep. 862.

   Pryor, J.

7A judgment for the plaintiff, in an action for loss of baggage, against an ocean carrier, is challenged on appeal for alleged errors of the court in the charge, in the refusal to dismiss the complaint, and in the exclusion of evidence. ■

1. It is insisted that the action miscarried for failure of proof that the contract of transportation was by the defendant company; but if sc, then because no evidence was adduced of negligence on the part of the defendant.

Defendant’s contention, urged, however, obliquely rather than explicitly, is that 'the steamer Sorrento, on which plaintiff came passenger, was of the Union Line, and not in the service of the defendant company. But, the evidence for plaintiff was ample to justify the conclusion that the Sorrento was in the employ of the defendant, either alone or in association with the other company ; or else, that at all events the defendants had engaged for the carriage of the plaintiff, no matter by whose steamer. And, now, upon this point, did the defendant meet the plaintiff’s proof ? By the statement of its clerk—its solitary witness—that “ the Sorrento is not one of those vessels that belong to the defendant company only ; ”—a plain intimation that the defendant had an interest in the Sorrento, and an equally distinct implication that though the Sorrento did not “ belong ” to the defendant, yet, nevertheless, it was carrying for the defendant.

If the Sorrento were not in the service of the defendant, or if the defendant did not contract for the carriage of plaintiff, clear and conclusive proof of these facts was necessarily within the power of the defendant; and failure to produce such proof reinforced plaintiff’s evidence by an obvious and persuasive presumption.

Upon evidence susceptible of diverse inferences, the learned trial judge instructed the jury that “if you believe the steamer which carried this baggage was not the property of the defendant, and that the defendant had no connection with it, the plaintiff cannot recover.” On the issue so presented the jury found for the plaintiff, and we are concluded by their verdict.

Similarly, on the question of defendant’s negligence, we are satisfied that the evidence is sufficient to sustain the fact. But, though otherwise, the liability of the defendant still remains. For the obligation of a common carrier by the sea is as insurer against all casualities except by the act of Grod or the public enemy, 2 Kent Com., 599-600; Wheeler v. O. S. N. Co., 125 N. Y. 155, 160; 34 St. Rep. 866, and “the burden of showing delivery of baggage to the passenger is upon the defendant.” Matteson v. R. R. Co., 76 N. Y. 381; Tarbell v. Shipping Co., 110 N. Y 170; 17 St. Rep. 153; Isaacson v. R. R. Co., 94 N. Y. 278. Immediately on landing, and persistently afterward, the plaintiff demanded delivery of his baggage, but without effect. The responsibility of the defendant is clear and incontestable. It was not error, therefore, to deny a dismissal of the complaint.

2. It is urged, furthermore, that the learned Judge erred in excluding evidence that the Sorrento was not the property of the defendant. That may be, and yet the steamer might have been in the service of the defendant and the identical vessel on which it undertook to carry the plaintiff. But the defendant’s objection is 'avoided by a a still more decisive answer, namely, that the evidence, the supposed rejection of which is the subject of criticism, was received and from the very witness by whom it was offered, who said : “The Sorrento is not one of those vessels that belong to the defendant company only.”

3. To diminish the amount of recovery defendant introduced a ticket, claimed to have been given to plaintiff, containing the clause that “the indemnity for lost baggage will in no case exceed fifty dollars.” Upon this the court charged that, to bind the plaintiff,the provision must have been assented to by him; that “the mere fact of the paper not having been read to him would not exempt him from the terms of the contract; ” that “ if by any means he assented to its terms he would bo bound by it equally as if he had read it.” To the instructions the defendant excepts; but we are of the opinion that if not correct, it is at least as favorable to defendant as consists with legal principle.

The paper relied on as limiting defendant’s liability was not given to him when and where he paid for his passage, but days afterward when he was already at sea on the steamer, and powerless to repudiate the pretended contract. When a party has no freedom to reject a proposed stipulation, because then unable to reinstate himself—here to reclaim his baggage and decline the-carriage by the defendant—an inference of his assent to the stipulation would be simply preposterous. His proceeding on the voyage and suffering his baggage to remain with the-carriers were-compulsory, and can, therefore, imply no assent to terms of transportation then for the first time communicated to him, Smith v. Brady, 17 N. Y. 173, 187 189. Further argument in support of the proposition would be an affront to common sense: a judicial decision in negation of the proposition would be a mockery of justice.

Though altogether unnecessary, it may be added that the contract for plaintiff’s carriage was consummated when he paid and the defendant accepted the money for his passage; that no terms-of conveyance being then agreed, the law prescribed the conditions of plaintiff’s carriage; and that his first assent, even though express, to the limitation of liability claimed by defendant, would have been nugatory, because without consideration. The defendant was already bound to carry the plaintiff; and an agreement to do what one is already under legal obligations to do can be no consideration for a counter engagement, Bishop on Contracts, § 48 ; Tilden v. Mayor, 56 Barb. 340.

The law,» no less than the justice, of the case is with the plaintiff.

Judgment affirmed, with costs.

Daly, C. J., and Bischoff, J., concur.


author: Van Brunt, P. J.

text:
    In the Matter of Peter Hayden, Deceased.

      (Supreme Court, General Term, First Department,

      Filed April, 1894.)

    Wili—Construction.
    Where there is a division of the residuary estate and a life estate only in the shares or interests in the estate, with a disposition over of the principal of such shares, the legatees of the residuary estate, if of full age, take absolutely the income derived from their proportions of the estate, unaffected by any suspension of the absolute ownership.
    Appeal from portions of a decree of the surrogate made in á proceeding instituted by the executors-appellants for a judicial settlement of their accounts.

      John Notman, for app’lt; 0. A. Strong, for resp’t.
   Van Brunt, P. J.

Peter Hayden, the testator, died the 6th of April, 1888, leaving him surviving his widow, three sons, two-daughters, a granddaughter and grandson, children of a deceased daughter, his heirs and next of kin. On the 30th of March, 1886, said testator duly executed his will, in which, after having given, devised and bequeathed certain property to his widow, he directed his executor to set apart out of his estate, and invest and keep securely invested a sum sufficient to produce a net yearly income of $20,000, and to pay said net yearly sum to his wife, and at her death lie provided that the annuity should cease and the principal sum directed to be set apart to provide said annuity should, after accounting for and paying to her personal representatives any balance of the annuity unpaid at the date of her death, revert to and become a part of his residuary estate. The testator then provided that should there be in any years a deficiency of income from the trust fund set apart as above directed, such deficiency should be made good out of his general estate. After making certain provisions for his sons, the testator established annuities for his two daughters, in each case providing that upon the death of the annuitant without issue the principal sum, which had been set apart to provide the annuity should revert to and become a part of his residuary estate. The testator then directs his executors to provide annuities for his two grandchildren, the children of his deceased daughter, amounting to $6,000 per year for each of said children. He then provided that his executors should apply the income as fast as received by them to the use of the child which each annuity represented, during the minority of such child, so far as might be necessary for the support and education of such child, and then-provided that any surplus income should be accumulated, etc. The testator further provided that, in respect to . these annuities, also they should be made good out of his general estate. The testator then disposes of all tbe rest, residue and remainder of his estate (including all sums which should, on the termination of any life, as in said.will provided, revert to his estate) as follows:

“All the rest, residue and remainder of my estate which shall come into the possession of my executors, after making full provision for all the trusts and payments hereinbefore directed, including all sums which shall, on the termination of any life, as hereinbefore provided, revert to my estate, shall constitute my residuary estate; and I hereby give, devise and bequeath the same, wherever situated, unto my executors hereinafter named, or such of them as shall qualify under this will, and the survivors and survivor of them, _ to have and to hold the same, and every part and parcel thereof, in trust, to divide the same and the proceeds of sale of such portions thereof as they may sell, under the power of sale hereinafter given, into as many equal parts as I shall leave surviving me children and the issue of any deceased child, such issue of any deceased child to stand in the place of their parent, one share to represent each child and the issue of any deceased child, per stirpes, and to pay over to each child the share representing such child, and to the issue of any deceased child the share of such issue; the share of any minor to be paid to the guardian of such minor. Such division and payment shall be made from time to time as my resid nary estate shall be received by my executors, and shall be capable of division or distribution; but in no case shall any such division or distribution be made until ample provision has been made, as hereinbefore specified, for each and all of the trust funds hereinbefore directed, and any loss, deficiency or impairment of either of the same shall be made good out of my residuary estate before any such division or distribution, my object being to secure to my daughters and grandchildren hereinbefore named the annual income provided for them respectively before any division of my residuary estate.”

On the 19th of May, 1886, the testator made a codicil to his will, by which he directed that the principal of the several shares of his daughters then living in his residuary estate should, as fast as ascertained from time to time by his executors, instead of being'paid to his said daughters respectively, should be retained by the executors and kept safely invested, and the income only thereof should be paid to his daughters respectively during life, and on the death of either the principal of the share of such daughter should belong arid be paid to the lawful issue of such daughter, and in default of. issue should belong to and be divided in equal parts amongst his sons and the children of another deceased daughter of his.

The executors and trustees of the will of the testator1 duly constituted the trusts provided for by said will, and during the course of administration certain income was received by them from the rest, residue and remainder of the estate. It also turned out that a larger amount of income was received from the securities set apart for the production of the annuities than was required for that purpose, and the question which is presented upon this appeal is whether such amounts of income, which under the will would have been paid to the two daughters of the testator, upon division of the estate are to be held as principal by the executors of the will as trustees of the shares of the daughters under the codicil.

In view of the provisions of the Revised Statutes in reference to accumulations of income, it might be a serious question as to the validity of this will if the construction claimed by the appellants must necessarily prevail, because it would appear that under the prohibition of the Revised Statutes (1 R. S. 726, § 37), there- can be no accumulation of income except for the benefit of a minor, and such accumulation must terminate at the expiration of minority.

It is to be observed that in the ordinary administration of an estate, where provision is made by a parent for his widow and children, the usual construction is that the income of the estate received pending the period of administration, shall not, unless necessary for the payment of debts, be.considered as a part of the estate to be distributed as principal, but rather be paid over to the persons to whom the income of the principal of the estate is devised or bequeathed, for their maintenance during the period of administration. Any other rule would seem to be in conflict with the provisions of the Revised Statutes in respect to accumulations to which attention has been called. Where there is a division of the residuary estate, and an absolute bequest thereof, as to some of the legatees under this will, the question here involved becomes of no importance, because the legatee takes his share of the principal and income together. But where there is a life estate only in the shares or interests in the estate, with a disposition over of the principal of such shares, a different question necessarily arises. And we know of no way in which the prohibition of the statute can be avoided, except by so interpreting the will that the legatees of the residuary shares, if of full age, might take absolutely the income derived upon their proportions of the estate unaffected by any suspension of the absolute ownership.

And we think that, upon an examination of the will in question, such was clearly the intention of the testator. There is, so far as the annuities are concerned, no provision contained in the will for any surplus of income reverting to his residurry estate as such. The provision is that the principal which had been set apart for the purpose of producing these annuities should revert to his residuary estate on the death of the annuitant, and that the unpaid portion of the annuity should belong to the personal representatives of the annuitant But there is no intimation that it was the intention of the testator that any portion of the income derived from his estate should be accumulated as against any of the legatees except in thé case of the grandchildren during minority. It is evident, from a consideration of the provisions in regard to accumulations of income of these minors, that the testator had in mind the provisions of the .Revised Statutes in reference to accumulations of income, and that such accumulations could only be provided for during a minority.

If the appellant’s claim should be sustained, there might be an accumulation of income during the lives of the whole of these annuitants by an excessive appropriation of money to the establishment of these annuities, and the daughters, the absolute ownership of whose shares has been suspended, might be deprived of that which the testator intended they should receive.

In view of the provisions of the will, it was undoubtedly the duty of the executors to be sure, in the constituting of these annuities, that a sufficient principal sum was provided for their production. The testator was solicitous that there should be no failure in respect to this matter. But there is nothing in this will to show that the testator intended, by any of the provisions therein contained, that his daughters should be deprived of any portion of the estate which would naturally come to them as income because of the manner of administration upon the part of the executors. named in the will.

We are aware of the language that the testator used in connection with the division and distribution of his estate. But he had no power, even if he so intended (which we do not think he did), by any means, direct or indirect, to prevent the absolute vesting of the income derived from his estate in somebody, and he could only direct any portion of such income to be accumulated during the minority of the owner of the share of his estate from which it was derived.

It is important to observe, as already stated, that wherever the testator speaks of accretions to his residuary estate, it is always in reference to the principal of his estate; and in his provision for the holding by his executors, as trustees for his daughters, of their shares, he speaks of the principal of such share, and nothing is said .about the trustees holding any portion of the income which should be derived from his estate, and which would naturally belong to his residuary legatees.

There seems to be no way in which this construction can be avoided without infringing upon the statute, which was.evidently not the testator’s intention.

We are of opinion, therefore, that the decree of the surrogate was correct and should be affirmed, with costs to all parties to be paid out of the estate.

Follett and Parker, JJ., concur.


author: Freedman, J.

text:
    John Cheney Platt, Resp’t, v. The Mayor, etc., of the City of New York, App’lt.

      (New York, Superior Court, General Term,

      Filed May, 1894.)

    1. Municipal corporations—Liability.
    A municipality, in the exeroiseof its discretionary powérs, has the right to separate its walls and drives by fences, and is exempt from liability for the manner in which its officers, in good faith and within the scope of their respective powers, exercise such discretion.
    2. Same.
    There is no absolute obligation on the part of the city of New York to light its streets.
    3. Presumption—Authority.
    It is to be presumed, in the absence of proof to the contrary, that the president of the department of public parks, in issuing an order for the erection of a fence, acts pursuant to authority conferred upon him by the ■ board of copamissioners of public parks.
    4. Same—Parol evidence.
    If there is no record evidenee of such authority, parol evidence is admissible to establish it.
    Appeal by defendants from judgment entered upon a verdict in favor of plaintiff1 and from order denying defendants’ motion for a new trial.

      Iheall & Beam (Austen (7. Fox of counsel), for resp’t; Wm. II. Clark, Counsel to the Corporation (Theodore Connolly and Terence Farley of counsel), for app’lts;
   Freedman, J.

The action was brought to recover damages for a personal injury. On July 24, 1890, the plaintiff rode on horseback up Riverside drive to dine with some friends at Audubon Park, where he safely arrived. After dinner the plaintiff left Audubon Park at about half-past nine o’clock, rode down to Claremont, and from that point attempted to ride home by way of a bridle path on Riverside drive.

At the trial the plaintiff claimed that at Claremont there were" two bridle paths; that he took the one on his right hand as he was going ; that-after riding upon it for some distance on a stiff trot, the night being dark, he struck something between One Hundred and Third and One Hundred and Fourth streets which caused him and his horse to fall; that by reason thereof he sustained personal injury, and that what he collided with was a wire fence which bad no light upon it or near it, and which was stretched clear across the bridle path upon which he was riding quite fast

The defendant, however, by a clear preponderance of evidence, established the following facts, viz.:

The plaintiff did not ride upon the bridle path, but upon a path or walk reserved for pedestrians, which ran parallel with the bridle path and between it and a heavy stone wall on the river side. There was no fence across the bridle path at any point. There was a wire fence about three feet six inches high running along the westerly side of the bridle path from One Hundred and Fourth street to Ninety-sixth street, and constituting a boundary or division fence, between the bridle path and the pedestrian walk. From One Hundred and Fourth street north to One Hundred and Twenty-first street the boundary between the bridle path and the walk was defined by a paved gutter and a bluestone curb six inches high. No rider could get upon the walk without crossing the gutter and 'curb both. Formerly there was no bridle path at all between One Hundred and Fourth and Ninety-sixth streets. The fence was erected for the purpose of extending the bridle path south from One Hundred and Fourth street. The walk having been considered unreasonably wide for the demands of pedestrians, and there being a public demand for increased bridle path facilities the walk was divided by the Department of Public Parks, having jurisdiction in the premises, into two parts, with a well-defined boundary between them so as to afford between One Hundred and Fourth and Ninety-sixth streets both a walk for pedestrians and a bridle path for equestrians, and in this way the bridle path which had existed from Claremont to One Hundred and Fourth street was continued soutli to Ninety-sixth street. In addition to the fence, the gutter and the curb spoken of, there were some guide posts indicating the patli set apart for visitors on horseback, one of which the plaintiff saw on his ride up, and near to the place of the accident, namely, at both corners of One Hundred and Fourth street, and between One Hundred and Third and One Hundred and Fourth streets, there were street lamps which, from their position, must have thrown some light on some parts of the fence. Indeed, the fact that at no point was there a fence across the bridle path was so clearly established that the learned trial judge felt bound to instruct the jury concerning it as follows, viz: There was no fence across this bridle path. The fence that was there was a fence that passed along the extreme west of the bridle path, and was between it (the bridle path) and the path for pedestrians only. So that the words of his (meanihg plaintiff’s) statement must be modified so as to consider that what he came against was a fence of the road, in a proper sense, that went along it.”

Where, then, was there any proof of defendants’ negligence? There was nothing out of repair. There was no negligence in the construction of the fence. There was no obstruction in the bridle path. As the- fence, ran, only along the side of the bridle path, the defendants were under no duty to place lamps or lanterns upon it. There is no absolute obligation on the part of the city to light its streets. The mere existence of the fence gave no cause of action. Riverside Park, including the drive and the paths in question, was established, in pursuance of the authority conferred by chapter 496 of the Laws of 1885, and the department of public parks has by law the control and management of it. It was shown that the fence was erected pursuant to an order issued by the president of the department of public parks to the superintendent of parks. Presumably the president acted pursuant to authority conferred upon him by the board of commissioners of public parks. If there was any question about it, the evidence which was offered by the defendants upon this point should have been received, and it was error to exclude it. If there was no record evidence of it, parol evidence was admissible. Parol evidence is always admissible to show facts omitted from the record, unless the law'expressly and imperatively requires all matters to be of record and makes the record the only evidence. Dillon on Municipal Corp., 2d ed., §§ 237, 238; 4th ed., §§ 300, 301.

The case at bar is, therefore, analogous to the cases where people have been injured by driving against water hydrants, trees, hitching posts, telegraph poles, awning- posts or stepping stones situated on the sidewalk immediately adjoining the driveway. In this class of cases it has been invariably held that there was no liability on the part of the municipality. Ring v. City of Cohoes, 77 N. Y. 83 ; Dubois v. City of Kingston, 102 N. Y. 219 ; 1 St. Rep. 350; Macomber v. Taunton, 100 Mass. 255; Cushing v. Boston, 128 Mass. 330; Arey v. City of Newton, 148 Mass. 598; Wellington v. Gregsen, 31 Kans. 99.

It is a familiar rule that the question as to how much of a street shall be set aside for the driveway and how much for the sidewalk, trees, gutter, etc., etc., is, in the absence of a controlling statutory provision, matter of municipal discretion, and I cannot find that any one has ever questioned the right of a municipality to separate its walks and drives by fences. The exercise of this discretion is in the nature of a judicial act, and for this reason it is firmly established that a municipal corporation is exempt from all liability for the manner in which its officers, in good faith and within the scope of their respective powers, exercised such discretion. Mills v. City of Brooklyn, 32 N. Y. 495; Lynch v. City of New York, 76 N.Y. 60; Monk v. Town of New Utrecht, 104 N.Y. 552; 6 St. Rep. 484; Paine v. Village of Delhi, 116 N. Y. 224; 26 St. Rep. 620.

A municipal corporation does not insure the citizen against danger from works of its construction. Its obligation and duty in such respect is measured by the exercise of reasonable care and vigilance. Liability can only be predicted upon its rieglect1 or misconduct. Jenney v. City of Brooklyn, 120 N. Y. 167 ; 30 St. Rep. 877.

The construction of the fence in question, so far from having been a negligent act, was a precautionary measure to prevent equestrians from getting upon the walk reserved for pedestrians and injuring the latter, and its construction near the place of the accident may be even deemed to have been a prudent act, because at and near that point there was a slight curve in the bridle path corresponding with a similar curve in the driveway at that point, and because from that point south the pedestrian walk, owing to the construction of the bridle path out of it, was quite narrow'.

For the reasons stated, the construction and maintenance of the fence in the manner described do not sustain plaintiff’s alleged cause of action.

The only point remaining to be considered, therefore, is whether, in view of the existence of the fence, the Department of Public Parks should or should not have efficiently guarded the entrance to the pedestrian walk at Claremont where the plaintiff claims he got upon it. If this involved a mere error of discretion, the defendants are not liable within the authorities already cited. To have barricaded such entrance so as to make it impossible for a man on horseback to get upon the walk would have deprived pedestrians of the use of the walk. The ground of the pedestrian walk was made hard by rolling, while the bridle path was a soft road. There were benches at intervals along the walk. There were some signs up indicating the particular use to be made of each path. There was a well-defined and substantial boundary between the two as already described. The whole arrangement was such that the Department of Public Parks might well have considered that both paths were reasonably safe for all travelersus ing ordinary care and caution,whether traveling by day or by night. Indeed it is incredible that an accident such as befell the plaintiff, could happen in the daytime to a rider using ordinary care and caution. In this respect the present case differs materially from Fisher v. Village of Cambridge, 133 N. Y. 527; 44 St. Rep. 317, in which there was actual negligence in the construction of the bridge, and a notorious public use of the bridge, to the knowledge of the plaintiff, for certain purposes, by which, together with other appearances, the plaintiff was misled in broad daylight because he did not know that as matter of fact the bridge had been built for purposes other than those for which it was permitted to be used.

In the case at1 bar, the plaintiff was acquainted with the general arrangement of the locality, for he had ridden there on prior occasions, and he admitted that he knew that there was a pedestrian walk between the bridle path and the river side. This being so, and it having been fully established that there never was more than one bridle path at any point in that locality, I cannot conceive how, in the exercise of ordinary care and caution, it was possible for the plaintiff to get upon the pedestrian walk over a curb stone six inches high in the belief that it was the bridle path, which he must have known was not shut off by any such or any other obstruction, and when there was no other path or walk left between him and the heavy stone wall constituting the westerly boundary of the pedestrian walk, and then to proceed upon the said walk for about a mile without noticing the stone wall or the hardness of the road, or the benches upon it, or any of the other appearances which, it seems, should have indicated to him that he was not on the bridle path. The learned counsel for the plaintiff, in his brief, laid stress upon some testimony given by the plaintiff to the effect that some time after the accident the plaintiff examined the walk on which he had been injured, and then discovered the footprints of a horse upon it, and upon this testimony claimed that it was evidence tending to show that the defendants had permitted the said walk to be used by equestrians. The defendants fully explained how such footprints^ if they were the footprints of a horse other than the one ridden by the plaintiff, in all probability got there, and convincingly showed that such walk had never been permitted to be used by equestrians. Moreover, the plaintiff himself did not claim at the trial that on the evening of the accident he had been misled by noticing the footprints of a horse upon the said walk, and from the whole case it is perfectly clear that a rider who proceeded as the plaintiff did, without noticing the curbstone over which his horse must have stepped, and without seeing the heavy stone wall on his right, or the paved gutter and curb on his left, or the benches in his path, would not have noticed the footprints of a horse if any had been there.

It is not necessary, however, to consider the alleged contributory negligence of the plaintiff which the defendants'contend was established. It is sufficient for present purposes to hold that, upon the whole case, it was shown by a great preponderance of evidence that there was no actionable negligence on the part of the defend* ants, and that for this reason the defendants were entitled to a •dismissal of the complaint upon the merits or the direction of a verdict in their favor.

The judgment and order shall be reversed anda new trial ordered, with costs to the appellant to abide the event.

' Mo Adah, J., concurs.