author: Learned, P. J.: Bocices, J.,

text:
    WARREN NEWTON, as Administrator, etc., of JOSEPHINE V. ROSS, Deceased, Plaintiff, v. THE MUTUAL BENEFIT LIFE INSURANCE COMPANY, Defendant.

      Insanity — evidence as to— Question in application for life insurance, as to diseases — when only those of an hereditary character referred to.

    In an action upon a policy of life insurance, the defendant, in order to show the insanity of the deceased’s father, called the superintendent of an insane asylum in Ohio, having no personal knowledge of the disease of the father, who stated that it appeared from the records that he was twice admitted to the asylum.

      Held, that this evidence was improperly admitted.
    A copy from the records of the Probate Court, in Ohio, stating that the court visited Ross (the father), held an inquest, and, on the testimony produced, held him to be a lunatic, was also given in evidence by the defendant. No proof of the authority g-iven to this court by the laws of Ohio was offered.

      Held, that this evidence was incompetent to show the insanity of the father.
    A question in the application was: “Have they (parents, brothers, or sisters) died of, or been afflicted with insanity, epilepsy, * * * or other hereditary disease 1 ”

      Held, .that it was only insanity of an hereditary character that was referred to in the question, and not an accidental or temporary insanity.
    Motion for a now trial on a case and exceptions ordered to be heard, in the first instance at the General Term, after a nonsuit directed at the Circuit, and an appeal from an order denying a motion for a new trial, made upon the minutes of the justice before whom the action was tried.
    The action was brought upon a life insurance policy, given by the defendant, insuring the life of C. Henry Ross, in the sum of $5,000, and dated the 17th day of January, 1867. The policy was given to Mrs. Josephine Y. Ross, wife of said C. Henry Ross, who, through the agency of her husband, made the application therefor. The said C. Henry Eoss died from the effects of laudanum, taken by him on the 15 th day of November, 1874. Proofs of death were furnished to the defendant by the said Josephine Y. Eoss to this effect. Subsequently the said Josephine Y. Eoss died, and the plaintiff, Warren Newton, was appointed administrator of her estate and commenced this action as such. It was tried on the 21st day of November, 1876, and the plaintiff' was nonsuited. The defense was that Eoss had committed suicide; that he died from using intoxicating liquors, in violation of the condition of his policy, and that the answer to certain of the questions in the application for the insurance were false.

      George M. Tillson, for the plaintiff.

      P. II Prindle, for the defendant.
   Learned, P. J.:

On tlie question whether the deceased, C. Henry Eoss, “died by his own hand,” I think the case should have gone to the jury; principally on the point of his mental condition.

So, on the question (if that was urged by the defendant), whether the deceased died by reason of intemperance.

The remaining points have respect to the answers to questions in the application for insurance. “Have they (parents, brothers or sisters) died of or been afflicted with insanity, epilepsy, disease of the heart, scrofula or other hereditary disease?” Answer: “No.” '“If not living, at what age, and of what disease did they die?” Answer: “Father died at about 45 years from a brain disease caused by a hurt.”

The defendant claims that the father of the deceased was afflicted with, and died of insanity.

The evidence given by the defendant on this point is testimony by a superintendent of the Cleveland Hospital for the Insane in Ohio. He knew nothing of the disease of Benjamin Eoss, father of the deceased, but stated that the record of the books showed that he was twice admitted to that hospital.

I think that evidence improper. At the most it only established the fact that Benjamin Eoss had been admitted to the asylum; not that he was insane. Against the plaintiff, the administrator of Josephine Y. Ross, it established nothing material to the case.

Other evidence offered by the defendant was a copy of the records of the Probate Court in Ohio. These records simply state that the court visited Benjamin Ross, held an inquest of lunacy, and on the testimony of a respectable physician (naming him), and other testimony held said Ross to be an insane person. ' No proof was made as to the authority given to this court by the laws of Ohio. It was proved that the laws of Ohio require the papers in such cases to be filed, but no record thereof to be made; only a “journal entry of the finding of the court.” Now, admitting that an inquisition of lunacy duly found is prima facie evidence, the evidence produced falls short of such an inquisition. An inquisition, as known to our lawr, is a finding of facts by a jury. (Bouvier’s Law Diet.) We cannot assume, without proof, that the laws of a State have dispensed with that safeguard. Nor can we admit that such a mere entry as was produced is evidence in this State of the insanity of a person.

The remaining evidence on this point of insanity is that given by the widow of the deceased, called on behalf of the plaintiff. She testifies that Dr. Ackley said her husband needed quiet and treatment, and under those conditions he went to the asylum; that he was not confined with the patients; that he worked in the bakery and earned money; that he complained of pain in his head; that he had a hurt when a child; that he came out of the asylum and went back there again in the fall, and then came out about Christmas and lived with his wife till he died; that he always recognized her and his children. He seemed to know what was going on clear to the end. Before his death it was said that he had a softening of the brain. On a post-mortem examination, it was found that the brain was in a hardened state. When a child he had been hurt in the back of his head by a fall.

Now, on this evidence, it seems to me that at least it was a question for the jury, whether the answer was not true that Benjamin Ross died from a brain disease caused by a hurt. If there was a hardening of the brain, and if that was caused by the fall in childhood, the answer appears to have been true.

Again, looking at the other question, we see that it is “ Have they died of or been afflicted with insanity, * * * or other hereditary disease.” The word hereditary must have some meaning. The question probably is intended to determine whether the insured is likely to have the same disease. If the trouble under which Benjamin Boss suffered came from the fall, I do not see that we can assume that it was hci’editary. Indeed, he appears to have suffered rather under an enfeebling of the mind; “seemed like a man who could not think, and he did not seem to have a mind.” The widow says he had paroxysms of wildness, and explains her meaning by saying that if anything irritated him, he would be like a stubborn boy.

It is said that the only legal test of insanity is delusion. (In re Forman’s Will, 54 Barb., 275; Seaman’s Soc. v. Hopper, 33 N. Y., 619.) There is no evidence whatever in regard to Benjamin Boss that he ever suffered under any delusion. I do not think it necessary to enlarge on this point. Probably without the evidence, which, in the view above stated was improperly admitted, it would hardly be claimed that insanity was proved beyond all doubt. There should be a new trial; costs' to abide the event.

Bocices, J.,

dissenting:

The dismissal of the complaint at the Circuit was ordered undoubtedly on the ground that the assured did not truthfully answer questions propounded to him in his application for insurance. To the usual question, whether any members of his family, parents, brothers or sisters, had died of or been afflicted with insanity, epilepsy, disease of the heai’t, scrofula, or other hereditary disease, he answered, “no; and in answer to the question, as to the disease of which his father died, he answered, “from"a brain disease caused by a hurt.” The case shows that his father had been insane, and twice an inmate of an insane asylum; and that he died insane; and further, that the assured knew of these facts when he made his application for insurance. The negative answer then to the question, whether his father had died of, or been afflicted with insanity, was untrue. In the ordinary understanding of > words, his father died of insanity, for he died of a chronic affection of the brain which caused insanity. It was to this fact that this branch of the inquiry was directed. Fevers, and some other general and some local disturbances of the system, will and often do produce temporary insanity. But a settled disturbance of the mental faculties, continuing for months and years, is quite a different matter. In the former case, that of a fever, for instance; a death occasioned by it would not be a death from insanity, but death from fever. In the latter case, however, a disease of the brain continuing for years, causing periods of insanity and ultimate death, would, according to common understanding, be a death from insanity. When, therefore, the assured answered that his father did not die of insanity, he answered untruly. So, too, when he answered that his father had not been afflicted with insanity, ho answered untruly. But it is urged that his insanity was not in his case an hereditary disease, and, therefore, the answer was not untruthful. Now, insanity, epilepsy, disease of the heart, and scrofula, are held to be of the class of diseases known as hereditary, and the question was, did he die of, or- had he been afflicted with insanity * * * or other hereditary disease? The question was not, in its full scope and meaning, did he die of, or had he been afflicted with hereditary insanity, but did he die of, or had ho been afflicted with insanity or other hereditary disease? The question was answered untruthfully, according to its fair import. It is suggested that the record evidence, that the father of the assured had been adjudged insane, was improperly admitted. It is here unnecessary to consider this point, inasmuch as his insanity was established by other competent and satisfactory evidence. It is also urged by the respondent, that the answer to the effect that the father died of a brain disease “ caused by a hurt ” was untruthful. I confess I am not satisfied with the integrity of this answer under the facts of this case. But its discussion is unnecessary, in view of the conclusion above reached, with reference to other answers, Of course, if the answers above considered were untruthful, the policy was void. Such is the express stipulation contained in the policy itself; and the cases which bear on this point are too numerous and familiar to require citation. It was also provided in the policy, that in case the assured should “ die by his own hand,” then that the policy should be void. He did die undoubtedly by his own hand. He swallowed a fatal dose of laudanum,' and purposely to produce death. But whether he was entirely himself, and responsible for the act may be well doubted. Had this been the turning point in the ease, it _ might well be insisted that this was, on all the evidence, a proper question for the jury.

But, in the view above taken of the case, this point is wholly immaterial. I am of the opinion that the dismissal of the complaint was well directed.

Present — Learned, P. J., Bocees and Boardman, JJ.

New trial ordered, costs to abide event.


source: Caselaw Access Project

author: Bockes, J. : Leaened, P. J.:

license: Public Domain

text:
    R. HALSTED WARD, Respondent, v. NATHAN B. WARREN, STEPHEN E. WARREN and GEORGE HENRY WARREN, Appellants.

      ■Ven’diet on specific questions, submitted in an equity case — a new trial must be moved for — JEasement—acquisition of, by prescription.

    Where, in an equity case, specific questions of fact have been submitted to the jury, under the direction of the court, and no motion for a new trial has been made upon the judge’s minutes, or at Special Term upon a case and exceptions, a party appealing from the judgment will be deemed to have acquiesced in the verdict, and the questions of fact involved therein cannot be reviewed on appeal.
    What facts are sufficient to notify the owner of a lot, over which an easement is alleged to have been acquired by prescription, of the claim of the person acquiring the same thereto, considered.
    Appeal from a judgment in favor of tbe plaintiff, entered upon tbe trial of tbis action at Special Term. The action was brought to restrain defendants from interfering with the plaintiff's enjoyment of a right to use an alloy between bis house and one belonging to defendants.
    Tbe justice before whom the action was tried, found among other things : That the plaintiff owned and had occupied for ten years last past certain premises in the city of Troy, New York, described in tbe complaint herein as tbe south half of lot No. 327, situated on the west side of Fourth street, between Broadway and Fulton streets, in said city. That for forty-eight years plaintiff ancl liis grantors had used and enjoyed, in connection with said premises, a right of way on and over a certain strip of land or alley-way on the lot adjoining, belonging to defendants. That said way extended from the west side of Fourth street to a point beyond the rear of plaintiff’s dwelling-house, and had a gate on Fourth street, also a gate on the north side of said alley-way leading into plaintiff’s premises, which said gates had been maintained by the plaintiff and his grantors during the whole of said period ; that the gate on Fourth street had, during the whole of said period, been kept locked at night, and the key had always been under the control and in the possession of the plaintiff and his grantors. That there was not at the time of the trial; and never had been during that period, any opening or entrance from or through said alley-way to defendants’ premises; that said alley-way or strip was a part of the lot or premises of the defendants which adjoins plaintiff’s premises on the south ; that the use of the said way by the said plaintiff and his grantors during the xvhole of said period had been adverse, under a claim of right, exclusive, continuous, uninterrupted, open and notorious, Avith the knoAvledge and acquiescence of the defendants and their grantors, owners of the estate out of, over, and in which said right of Avay existed. That said use by the plaintiff and his grantors commenced prior to the purchase or occupation of the defendants’ premises by Nathan Warren, deceased, or his tenants. That there had not been, since said purchase, uninterrupted occupation of defendants’ premises .by tenants; that the same had been occupied by a great number of different tenants for short periods of time, and were occasioxxally without occupaxxts; that said defendaxxts axxd their grantors wex-e xxot ixx hrw disabled dxxring said period from resisting the claim of the plaintiff axxd his graxxtors to said right of way. That the defendants, at the time this actioxx was broixght, threatened to make excavations axid construct, axxd have siixce made excavations axxd constructed, a building, with solid fouxxdatioxxs, across said alley-way or stxdp, and have thereby wrongfully and Avholly obstnxeted aixd closed said way so that the plaintiff is prevented from passing thereon to and froxn his premises, and eixjoying the said way as he had beexx accustomed to axxd might rightfully do.
    The jiuy, to xvhoixx specific questions were sxxbmitted, fouxxd that the plaintiff and his grantors had been in the exclusive possession and occupancy of the alley for forty-eight years, and that the defendants and their grantors had known of such occupancy and ■possession.
    i Fsek Gowen, for the appellants.
    It was necessary fot the plaintiff to prove that his use of the right of way was with the knowledge and acquiescence of all three of the defendants, who were tenants in common of the estate over which this right was asserted. (Washburn on Easements [3d ed.], 40; Portmore v. Bunn, 3 Dow. & Ry., 145; Crippen v. Morss, 49 N. Y., 63; Marshall v. Trumbull, 28 Conn., 183; McGregor v. Wait, 10 Gray, 72.) That the use of the easement must be with the knowledge and acquiescence of the owners of the servient estate, in order to be adverse, is too well settled to admit of dispute. (Washburn on Easements [3d cd.], 160; 2 Washburn on Real Prop., 300; Blake v. Everett, 1 Allen, 368; Carbrey v. Willis, 7 id., 368; Hannefin v. Blake, 102 Mass., 297; Parker v. Foote, 19 Wend., 309; Calvin v. Burnett, 17 id., 568; Cleaveland v. Ware, 97 Mass., 409.) The plaintiff and his grantors could not acquire an easement in this land by prescription, because, during all the time of their occupation, the servient estate was occupied by tenants and was not in the possession of the defendants, so that they could protect themselves from this use by an action of trespass. (Wash-burn on Easements [3d ed.], 163; Baker v. Richardson, 4 Barn. & Ald., 609; Baxter v. Taylor, 4 Barne. & Ad., 72; Pearsall v. Post, 20 Wend., 113; McGregor v. Wait, 10 Gray, 72.)

      James Bansing, for the respondent.
    Actual knowledge upon the part of the defendants and their grantors of the user is not necessary; it is sufficient if, by ordinary observation, they might have known the user. (Poignard v. Smith, 6 Pick., 178; 2 Greenl. on Ev., § 430; Townsend v. Bisell, 4 Hun, 297.) The defendants, Stephen E. and George H. Warren, having for more than thirty years acted as agents for their co-tenant, Nathan B. Warren, in the management of said premises, knowledge acquired in the transaction of the business as such agents is the knowledge of their principal. (Bigalls v. Morgan, 10 N. Y., 178; Bank of the U. 8. v. Davis, 2 Hill, 471; Dart on Vendors, 184.)
   Bockes, J. :

This being an equity case, and specific questions of fact having been submitted to the jury, under the order or direction of the court, as a substitute for feigned issues, and no motion for a new trial having been made on the judge’s minutes or otherwise, it is insisted on the part of the respondent that the defendants must be deemed to have acquiesced in the verdict of the jury. This question of practice seems to be settled in favor of the respondent. (Rule 33, 1858 ; Rule 40, 1874; Rule 31, 1878 ; Brown v. Clifford, 7 Lans., 46 : Hatch v. Peugnet, 64 Barb., 189 ; Hegeman v. Cantrell, 1 W. D., 450.) In the last case cited, the judge, in delivering the opinion of the court, remarked that without such motion either on the minutes of the judge or at Special Term, the party “ must be deemed to have acquiesced in the verdict, and the same cannot be questioned any more.” The verdict might or might not have been adopted by the judge when giving final judgment, as he was not precluded in that regard by previous action on a motion for a new trial on the questions of fact submitted to the jury. But in this case ho adopted the verdict in his findings, and it stands unchallenged, except as it is now assailed on the appeal from the judgment. The practice does not appear to have been very clearly defined in cases like this in hand; but it seems that in case a motion be made on the minutes of the judge, at the trial and denied, the case would be open for full examination on the evidence when considered on the appeal from final judgment; and in the event of a motion for a new trial at Special Term on a case and exceptions, it should be made on a final hearing, in order that such motion might then be determined on the ordering of judgment. Here no motion has been made for a new ti'ial on the minutes of the judge, nor at Special Term on a case and exceptions. Therefore, according to the rule of practice and the .authorities above cited, the verdict cannot be now questioned on the appeal. The verdict of the jury is to the effect: (1) that the plaintiff and his predecessors in title have had the exclusive possession and occupancy of the alley in question for a period of forty-eight years ; (2) that such possession and occupancy were with the knowledge of the defendants and each of them ; (3) and that while the trustees and executors of Nathan Warreii, senior, had title, which was prior to the cojiveyance to the defendants in 1846, they also had notice of the adverse use. Let these facts, with such others as are found by the judge, be deemed to be established, and the judgment awarded in this case is well supported.

But we propose to examine the case on the merits, as it appears on the evidence submitted. Certainly there was evidence sufficient to make the case a proper one for the jury, on all the questions passed upon by them; and we are of the opinion that the evidence supports all the findings of the learned judge, considering the case de novo on the proof. It is made satisfactorily to appear that the plaintiff and his predecessors in title, have had the exclusive occupation and use of the alley for a period far exceeding twenty years prior to its disturbance by the defendants here complained of. This fact stands indisputably proved. Such use was open, notorious and continuous, and was known unquestionably, as we think, to the defendants and to their predecessors in title of their lot. Such possession and use having been exclusive, notorious and unchallenged for so great a length of time, raises a presumption of the grant of a right commensurable with the use. It is quite probable that the knowledge of the trustees and executors under Mr. Warren’s will should not bo taken into account; but this becomes of no importance here, where it appears that the defendants acquired title in fee in 1846. The adverse user would be effectual against their claim, if continued from that time with their acquiescence. It is not very seriously urged, nor can it be, as we think, that Stephen E. and George II. Warren were unaware of the use of the alley by the plaintiff and his grantors. But it is insisted that the evidence is quite insufficient to charge Nathan B. Warren with notice, for the reason chiefly, as it is urged, that he was blind, and had been under such infirmity for many years. A blind man may have knowledge of a use, like that claimed and enjoyed in this case; and the evidence is such that notice to Nathan, although blind, may be fairly inferred. lie resided in the city, and had been familiar with the premises from his boyhood. When a boy, before he lost his power of sight, he had seen the doorway opening the passage through the alley, and had, in after years, conversed with his brothers, the other defendants, about the property, and planned with them in regard to improvements on the lot, and in regard to taking down the old house and building a now one there. These facts, with the great length of time during which the alloy had been exclusively and continuously used by the owners and occupants of the house on the noi’th of it, authorized the conclusion that he had knowledge of such use. It can hardly be that even a blind man will remain indifferent to the condition and actual use of his property, so as not to gain knowledge in that regard, during a period exceeding twenty years, when situated in the city of his residence, and from which he derives advantages by way of income. Wo concur in the view expressed by the learned judge on the trial, that a man has no right to buy property, plan in regard to it, enjoy the use of it through rents derived from tenants under short leases, and shut his eyes to those facts and circumstances of its use by the adjoining proprietor, which, in the exercise of ordinary and reasonable care and attention, would give him notice thereof. We are of the opinion that the circumstances of the case well authorized the inference, if indeed it be not the necessary legal inference, that the plaintiff’s use of the alley was known to Nathan B. Warren, and acquiesced in by him. On careful consideration of the case on the proof, we are satisfied with the conclusion reached on the trial, that all the defendants had knowledge of the adverse use insisted on by the plaintiff.

It is further urged by the appellants that the plaintiff and his grantors could not acquire an easement in this land by prescription, for the reason that, during all the time of their occupation, the servient estate was occupied by tenants, and was not in the possession of the defendants, so that they could protect themselves from this use by an action in trespass. In the first place, we do not understand that this alley was ever under lease, m point of fact, from the defendants. The tenants were tenants of the house (and yard probably), but they never had any occupation of or right to the alley, in so far as we can see. The alley was closed to the south lot. It was a passage-way into the north premises, and was neither occupied nor used in any other way than by the plaintiff and his grantors for the convenience of the north lot and premises. The defendants were, therefore, at all times in a sitúation to maintain either trespass or jectment, with a view to protect themselves from the plaintiff’s adverse use. So they were able in law to assert and enforce their rights, and to resist any adverse claim to the alley if not well founded. But, secondly, the leases to the defendants’ tenants were of short duration, from one to three years; and it is well found on the evidence that there has not been uninterrupted occupation of the defendants’ premises by tenants; that the promises were occasionally without occupants. Therefore, as the court held and decided at Special Term, the defendants were not in law disabled from resisting the claim of the plaintiff and his grantors to the right of way.

Now, here was an open, notorious, and continuous occupation and use of the alley by the plaintiff and his grantors, for a period greatly exceeding twenty years before the defendants’ disturbance of it. The occupation and use were, too, definite and exclusive. The plaintiff" claims the use as an casement only, limited by the extent of his enjoyment of it as a passage-way to the rear of his lot. Doubtless the use which he claims, and seeks to have protected to him, must have been with the acquiescence of the defendants. Such is found to be the case, and, as we think, it is so well found on the proof. The judgment awarded in this' case, therefore, seems well based, both on fact and law.

Judgment should be affirmed, with costs.

Boaedman, J., concurred.

Leaened, P. J.:

I concur with the views expressed in the foregoing opinion, as to the evidence and the conclusions of law, and think the judgment fully justified by the evidence; and where an easement has been used for a time sufficient to establish a prescription therefor, peacefully without-any interruption, not by force nor secretly, nor by permission, (Bracton iv, c. 37, fol. 220), I am not willing to admit that such prescription can be defeated by proof, that the owner did not, in fact, see the property.

Judgment affirmed, with costs.


author: Bocees, J.

text:
    JUDIAH ELLSWORTH, Appellant, v. SIMEON BROWN, Respondent.

      Dismissal of complaint for want of prosecution — Code of Civil Procedm'e, § 822 —payment to referee of his fees in advance.

    After this ease had heen referred to a referee to hear and determine, and several hearings had been had, he refused to appoint another hearing until his fees were paid.. After the case had remained in this condition for two years,defendant applied, under section 822 of the Code of Civil Procedure, to have the complaint dismissed for want of prosecution. Held, that the application should be granted.
    The propriety of paying a referee in advance, or securing to him his fees, considered.
    Appeal from an order made at Special Term, dismissing the complaint for want of prosecution.

      Mr. Lester, for the respondent.

      Mr. Varney, for the appellant.
   Bocees, J.

This is an appeal from an order made at Special Term, pursuant to section 822 of the Code of Civil Procedure, dismissing the complaint for want of prosecution. The order was provisional, and gave the plaintiff ninety days additional time in which to proceed — hence was unusually liberal in its terms.

It appears that the case was at issue, and had been referred to a referee to hear and determine ; that several hearings had been had before the referee, when the latter declined to appoint another hearing until his fees were paid. The case remained hi this condition for over two years, when this motion to dismiss the complaint was made.

We are of the opinion that the motion was properly granted. There had been an inexcusable neglect on the part of the plaintiff to proceed in the action. Nor is it a good answer to the motion, that the defendants themselves might have noticed the case for trial. The plaintiff had the affirmative. He was the actor until his case was presented and closed, and was himself bound to proceed. (Roy v. Thompson, 8 How., 253 ; Bowles v. Van Horne, 11 Abb., 84; Same Case, 19 How., 346 ; see, also, former and present rules of the court.)

We do not here intend to hold that a party may be required to pay a referee his fees in advance, or that any payment for fees should be made by a party to a referee until his report or decision is signed and ready for delivery. There may possibly be cases where this would be admissible, but they can be of rare occurrence, aud, as a rule of practice, such a precedent would be reprehensible in the extreme. It might lead to great abuse, and is suggestive of manifest impropriety. If a referee refuse to proceed in the reference, he may be removed and another appointed in his place, So, too, on sufficient grounds the court would, perhaps, require the deposit of money to meet the fees of the referee before he would be required to proceed; but such requirement would rest on something unusal and peculiar to the particular case. In the case before us, the plaintiff, in so far as is made to appear, omitted all effort to bring the case to a close for a period exceeding two years. He might have moved for the discharge of the referee, on the ground that the latter declined to entertain the reference; when, all the facts being made to appear, the court would, by a proper order, put him in a position to proceed, either by superceding the referee or by directing the deposit of his fees, in case that should be deemed right. But the plaintiff took no steps whatever to bring the case to trial. This he could not omit to do for an unreasonable length of time. He was bound to proceed with diligence. The alleged difficulty in the way of proceeding in this case was not caused by the defendants. Therefore, if any in fact existed, it lay with the plaintiff to remove it. As the case is here presented, action by the plaintiff was open to him, and it was his duty to proceed in the case; this he unreasonably neglected to do.

The order appealed from must be affirmed, with ten dollars costs of appeal and disbursements for printing.

Learned, P. J., and Boardman, J., concurred.

Order affirmed, with ten dollars costs of appeal and disbursements for printing.

       The decisions in other cases decided at this term will be found in 15 Hun.


author: LEARNED, P. J.:

text:
    PHILIP A. HOPKINS, Appellant, v. JOSEPH D. VAN VALKENBURGH, as Executor, etc., of EPHRAIM WHEELER, Deceased, EMILY H. WHEELER, LUCRETIA WHEELER, ELMIRA ROBERTS, and others, Respondents.

      Application to sell real estate to pay debts — contested eZaims against estate — jurisdiction of surrogate to hear and determine.

    The defendant, as executor, presented a petition to the surrogate for leave to lease, mortgage, or sell the real estate of his testator to pay debts. Upon the return-day of the order, to show cause, one Hopkins appeared and presented two claims against the estate, and asked to be allowed to prove them. These claims were opposed by the executor, and the heirs and devisees. The surrogate decided that he had no jurisdiction to hear or adjudicate upon the validity of the claims so presented. Held, that this was error.

      Quaere, whether the surrogate must adjudicate upon all claims presented, on the return of the order to show cause why a sale should not be made, at that time, or might postpone, as to any of them,, such adjudication until the application for distribution of the proceeds of sale.
    Appeal from an order of the surrogate of Chenango county refusing to try and determine the claims of Philip A. Hopkins against the estate of E. Wheeler, deceased, in an application by the executor to have the real estate of the testator sold to pay debts.
    Van Valkenburgh, the executor of Wheeler, deceased, presented a petition to the surrogate for leave to mortgage, lease, or sell real estate of the deceased to pay debts. On the return of the order to show cause, issued thereon, Hopkins appeared and presented two claims against the estate of Wheeler, and asked to be allowed to prove the same. The executor, the heirs and devisees, opposed his application; and the surrogate decided that he had no jurisdiction to hear the claims, or to take proof thereof and adjudicated upon the same as just and valid against the estate. Hopkins appealed, and the parties agreed that the only question on this appeal was as to whether or not the surrogate had jurisdiction. If he had, the case is to go back for him to pass upon other questions.

      F. H. JPrindle, for the appellant.

      Isaac 8. Newton, for the respondent, Van Valkenburgh, executor.

      George W. Bag, for all the other respondents,
    except the guardian ad litem for Emily H. Wheeler. The surrogate has not jurisdiction to try and determine upon the merits, and adjudicate as just and valid against an estate a claim that has been (or should be) presented to the executor or administrator, and has been by him disputed and rejected. (Redfield L. and P. Surrogate's Court, 263; Tucker v. Tucker, 4 Keyes, 136; .4 Abb. Ct. Ap., Dec., 428; 6 Barb., 352; 10 id., 308; 24 id., 60; 32 id., 354; 8 Abb. Prac., 425; Shakespeare v. Markham, 10 Hun, 311; 1 Tucker’s Rep., 352; 3 R. S. [6th ed.], 104, § 86; Matter of Glann, 2 Redf., 75; 2 Lans. Sup. Ct., 320; 30 Barb., 495; Jones, Fair, etc., of John Mason, 5 N. Y. Leg. Obs., 124; Boughton v. Flint, 13 Hun, 206.)
   LEARNED, P. J.:

It is elementary law that the power of an executor, simply as such, extends only to the personal property. Disputed claims against him, as the representative of the deceased, are to be tried and decided by common-law courts or by a statutory reference. The surrogate has not jurisdiction to decide the question between a creditor of the deceased on the one side, and the executor, as his representative holding his personal estate, on the other. (Magee v. Vedder, 6 Barb., 352; Tucker v. Tucker, 4 Keyes, 136.)

The statutory proceeding to sell lands for the payment of debts is a matter distinct from the ordinary powers of an executor. The authority is not derived from the appointment of the executor, but from a judicial proceeding against the owners of the lauds — that is, the heirs and devisees. (2 E. S., m. p. 101, § 9 [6].) The heirs and devisees may contest the validity and legality of any debts, and may set up the statute of limitations. (§ 13 [10].) A jury trial may be had. The surrogate is to enter in his proceedings three classes of debts. First. Those which he shall judge valid and subsisting. Second. Those which shall have been determined to be valid on such a trial. Third. Those recovered in a court of law on a trial on the merits. Thus it is plainly implied that, on this proceeding, the surrogate has the power of adjudication on the validity of some debts, at least. So that the principle that, as between executor and creditor, the surrogate cannot pass on the validity of a debt at the final accounting, does not, at least in its full extent, apply to his adjudication in this proceeding between creditor and heir or devisee. This distinction is noticed by Surrogate Ogdek in his opinion, cited in Magee v. Vedder (ut supra, at p. 358). Indeed, it does not seem to be disputed by the respondent here, that, as to those claims which the executor admits by his petition, the heir or devisee may dispute them, and the surrogate may adjudicate thereon. This shows, then, that the surrogate has jurisdiction to adjudicate on some claims between the heir and devisee on the one hand, and the creditor on the other, and that it is not necessary that they should go to a court of common-law jurisdiction. And it must be noticed that the real parties to the controversy in this proceeding are the creditors and the heirs or devisees. The executor is, as it were, but the officer of the court to effect the sale; whose place may, in certain cases, be filled by a disinterested freeholder. (2 R. S., m. p., 109, § 63 [52].) His admission of a claim does not bind tbe heir or devisee. Does bis rejection bind the creditor? The debts to be contested are those represented as existing against the testator.” (§ 13 [10].) Is there any reason why these words should be limited to those represented by the executor as so existing? His representation is of no binding effect in any way.

Further, a creditor may himself proceed to have the lands sold. This proceeding is in the form of an order to require the executor to show cause. But the heirs and devisees are to be subsequently notified; and the debts are to be “established before ” the surrogate. (2 R. S., m. p. 108, sections 59 et seq. [48 et seq.~\.) Thus it appears that, in these cases, the surrogate must have jurisdiction to decide on the validity of the debts, as between the creditor and the heirs or devisees ; and in these cases, the executor may plainly be an opposing party, not admitting the validity of the debt. If, then, on the,application of a creditor, the surrogate may order the executor, against his opposition, to proceed to sell lands, is there any want of jurisdiction to adjudicate on a claim presented by a creditor in a proceeding actually pending ?

And so again, when the proceedings have been taken by the executor himself, other debts may be proved; before distribution, to the satisfaction of the surrogate (section 51 [42]), so that, at that stage of the proceedings, the surrogate is distinctly given jurisdiction to adjudicate on claims.

Whether such proceeding, then, is commenced by the executor voluntarily, or on the order of a surrogate upon the application of a creditor, it appears to me that it is a quasi proceeding in rem, in favor of creditors against the heirs or devisees ; and that the surrogate has, and must have, jurisdiction to adjudicate for this purpose on the claims.

The case of Barnett v. Kincaid (2 Lans., 320), is thought to decide otherwise. But I think it does not. The learned justice, in Iris opinion, is careful to qualify his language, and to say that . the validity of the claim is not ordinarily within the scope of the surrogate’s duties. He says that; after sufficient appeared to indicate that a sale was necessary, the surrogate had a right to determine that the order should not be delayed to await the determination of the litigation. And he adds that, if the claim is not established in some other court, an opportunity will be furnished on the distribution for that purpose. Thus the learned justice implies that, on the distribution, the surrogate can adjudicate on the validity of claims. But he decides that the surrogate is not bound to do so at the time of hearing the application, when enough otherwise appears to make a sale necessary.

If the surrogate in the present case, therefore, had merely declined to pass upon Hopkins’ claim at that stage of the proceeding, on the ground that enough appeared to show that a sale was necessary, and that the adjudication of the Hopkins’ claim would cause delay, his action would have been according to the decision last cited. But he has hold that he has no power or jurisdiction (and that may mean at any time) to pass on the claims, and has dismissed them. In that respect I think his decision erroneous.

It is plain, too, that should a surrogate, as was done in the case last cited, on proof of a certain amount of debts, order a sale of enough land to pay them (2 R. S., m. p. 103, § 22 [18]); and if, on the distribution, other debts should be proved as provided by the statute, a deficiency would arise. Whether, then, in any case, it is best for the surrogate to adjudicate on all debts presented at the hearing, or, as was done in the case last cited, to postpone such as he may choose to the time of distribution, is a matter on which no opinion is expressed.

The order should be reversed and the proceedings remitted to the surrogate, that he may, in his discretion, adjudicate on the claim of Hopkins, if he chooses so to do, at this time. Costs of the appeal should abide the event of the proceedings.

Present — LearNed, P. J., Boardmak and Bocees, JJ.

Order reversed, and proceedings remitted to surrogate that he may, in his discretion, adjudicate on claim of Hopkins, if he chooses to do so, at this time ; costs of appeal to abide event of proceeding.


author: Bockes, J.: BoaRDMAN, J.:

text:
    THOMAS C. WALBRIDGE, Respondent, v. EDWARD D. JAMES, Appellant.

      Sale under foreeloswre — fees of referee on — fees, when the sale is ineffectual.

    A referee, appointed to sell property under a decree of foreclosure, is entitled to the same fees and commissions as a sheriff would be entitled to receive had he made the sale, provided that such fees and commissions shall not exceed in the aggregate fifty dollars.
    Where a sale is, for any reason ineffectual, the referee is entitled to fifty cents for receiving and entering the decree, and two dollars for advertising the property for sale.
    Appeal by the defendant, Edward D. James, from so much of an order made at a Special Term held at Ballston Spa., Sara-toga county, as requires the defendant to pay the sum of ninety dollars for fees of a referee for selling lands under a decree of foreclosure. Plaintiff moved, at Special Term, for an order fixing and determining the amount due and to be allowed, for fees, services and disbursements of Charles H. Tefft, Jr., and Augustine W. Shepherd, as referees in the above-entitled action.
    The action was brought to foreclose a mortgage, and the usual decree of foreclosure was entered on the 21st day of October, 1874. Said Tefft was, by said decree, directed to sell the premises according to law and the rules and practice of the court. The amount decreed to be paid to the plaintiff was the sum of $8,456.21.
    On the 22d of October, 1874, he caused an advertisement of sale to be inserted in the newspaper known as The Saratogian, for a sale on the 4th day of December, 1874, and continued to publish such notice in said paper until the twenty-first of November that year, when defendant James perfected an appeal, with the proper undertaking, for a stay of proceedings. Judgment of the General Term, affirming the judgment of the Special Term, was entered July 9, 1875. The referee commenced to publish a notice of sale on the second day of July, and continued the same in the paper before mentioned until July 24, 1875. On the 23d day of July, 1875, defendant James appealed to the Court of Appeals from the judgment of the General Term, filed the requisite undertaking, and gave notice thereof, staying plaintiff’s proceedings. The judgment of the General Term was affirmed by the Court of Appeals upon such appeal, and judgment upon its decision duly entered on the 21st day of June, 1876. On the last-mentioned day, the referee again advertised the premises for sale on the 4th day of August, 1876. The referee continued to publish such notice in said paper until the 4th day of August, 1876, when, as stated in the affidavit of the plaintiff’s attorney, at the solicitation of the defendant, it was again discontinued and further proceedings suspended.
    On the 5th day of April, 1877, said referee again advertised said premises in said newspaper for sale on the 18th day of May, 1877, and at that time the premises were sold by the referee to the defendant, Edward D. James, he paying, at the time of the sale, twenty-five per cent of the purchase-money, according to the terms of such sale, and he was to pay the balance thereof on the 28th day of May, 1877. The referee then prepared and tendered the deed, and attended at the place of the sale for the receipt of the remaining seventy-five per cent, but said defendant refused to complete the purchase. On motion of the plaintiff to this court, at Special Term, on the 14th of June, 1877, defendant was required to complete his purchase within a time named therein, or, in default thereof, the said referee was required to re-sell said premises at the expense of the defendant. The defendant failing to complete such purchase by the time allowed by such order, on the 21st day of June, 1877, said referee again caused said premises to be advertised for sale on the 3d day of August, 1877. On August 3, 1877, said sale was further adjourned by said referee, at the request of said defendant, to the 31st day of August, 1877. On the 31st day of August, 1877, said sale was adjourned by the referee until the 14th day of September, 1877. The sale was postponed again by reason of an injunction restraining the sale, but which allowed the referee to adjourn pending the motion for a permanent injunction in another action which said defendant commenced against plaintiff.
    September 8, 1877, in an ex parte application to the Special Term, Charles Ii. Tefft, Jr., not being able to continue in his office as referee, Augustine N. Shepherd was duly appointed referee in his stead, with power to complete the duties given by the original decree. On September 14, 1877, said Shepherd, as referee, attended at the place of sale in pursuance of said notice of adjournment, and further adjourned said sale until the 19th day of October, 1877. Such motion for an injunction remaining still pending on October 19, 1877, said referee further adjourned said sale to the 27th day of October, 1877. The said motion for a stay was denied October 25, 1877. • On October 27, 1877, said sale was further adjourned, at the request of the said defendant, until the 12th day of November, 1877. On the 12th day of November, 1877, said referee sold the premises to H. Kembal, Jr., for $5,700, of which amount he paid down $1,425, that being the amount to be paid down by the terms of the sale.
    The terms of sale required the purchaser to complete his purchase the 26th day of November, 1877, by paying the balance of his bid and accepting a deed of the promises ou that day at the office of plaintiff’s attorney. It was also provided by the terms of such sale that the notices and advertisements of such sale be continued to the twenty-sixth of November aforesaid, and that, if the purchaser should fail to complete his purchase, the premises should again be put up for sale to the highest bidder. Afterwards, and on application of said Kembal, it was agreed that said sale should be, and said sale was duly adjourned from the 26th day of November to the 3d day of December, 1877. Said Kembal having failed to comply with the conditions of sale on said 3d day of December, 1877, said referee again offered said premises for sale, and the same were sold to Thomas C. Walbridge, the plaintiff, for $5,700. That, on such last sale, the terms wore cash, the deed to be delivered and payment made on the day of the sale. The several adjournments above noted were duly published and posted.
    On the 4th day of December, 1877, the plaintiff and the said defendant James entered into an agreement, by which the plaintiff agreed to transfer his decree and his bid on or before January 15, 1878, on receiving the balance of the amount due on his decree and the amount of his taxable costs and disbursements in the action; and on January 14, 1878, said defendant, pursuant to such agreement, paid to the plaintiff $1,751.08, being the amount supposed to be due on the decree, except the legal fees of the referee and the expenses, including cost of advertising. And, by such agreement, it was provided that such fees and expenses were to be paid as soon as finally adjusted by order of the court. This motion is made, pursuant to such agreement, to adjust and determine the amount of such expenses and fees.

      JE. II Bonn, for the appellant.

      John O. Ilulbert. for the respondent.
   Bockes, J.:

The question presented on this appeal is as to the amount which a referee is entitled to demand and have on making sale of premises under a decree of foreclosure.

In this case there were three sales of the mortgaged premises, all of which it appears were regularly made — the last one only having been consummated by the delivery of the deed. The causes which rendered the first two of them ineffectual, it is useless here to state. Twenty-five per cent of the purchase-money was paid in on each of the first two sales, both of which, as above stated, fell through. On the third sale the premises were struck off and sold for $5,700 cash, and the title passed. It seems that Mr. James took the benefit of the purchase, and, as is understood, had the benefit of the money paid in on the prior sales, he agreeing to pay and satisfy the referee’s fees and expenses.

Briefly stated, the case stands the same as if Mr. James had been the purchaser at each sale, with a liability to pay and satisfy the proper and legal expenses of those sales — that is, what in law the referee was entitled to demand and receive for conducting them. No question is here made as to the allowance for disbursements. The learned judge at Special Term held that the referee was entitled to ten dollars fees, and twenty dollars commissions on each sale, amounting to ninety dollars in all. The allowances are challenged by the appellant James, who insists that a "sum not exceeding ten dollars in all was allowable. The Special Term held that the referee was entitled to the same fees and commissions as the sheriff would have been entitled to had he made the sale, to wit,- a sum for fees not exceeding ten dollars (Laws of 1847, ch. 280, § 77; 3 R. S., 222, § 93 [6th ed]); and commissions not exceeding twenty dollars in the aggregate (Delavan v. Payn, 8 Paige, 459); and that be was entitled to these allowances on each sale. It is probable that the attention of the Special Term was not called to the provision of the act of 1876, hereafter to be considered.

There is no statute declaring in terms the items allowable to a referee who makes a sale under a decree in foreclosure; but it has been decided at General Term, that by analogy, his services being the same as those of a sheriff in the same class of cases, he should have the same lees, with the limitations as to gross amount declared by law. This was held in Innes v. Purcell (2 N. Y. Sup. Ct. [T. & C.], 538.) In this case Judge Daotels collated the provisions of the law then applicable to the question, and reached the conclusion, on a clear line of reasoning, that the measure of compensation for similar services by a sheriff and referee in making a sale under a decree of foreclosure was the same; and it was there decided that a referee was entitled to fees to be taxed at the same rate as were allowed to a sheriff for performing the same services. With this conclusion we are satisfied. Then what fees would the sheriff have been entitled to, had he performed the services here performed by the referee? Since the decision in the case of lines v. Purcell {suprci), a new statute has been enacted bearing on the question under consideration. (Laws of 1876, chap. 431, § 11, making an amendment of § 309 of the Code of Procedure.) It is there provided “nor shall a greater sum than $50 be charged by or allowed to any sheriff, referee, or other officer for his/fees, percentage or services for any sale under a decree or judgment of foreclosure.’' This provision was in force when the sales in this case were had. Thus the limitation, then and now, stands at $50 (instead of $10 fixed by the former statute); but it expressly covers both fees and percentage. Now, in the case in hand, the referee was entitled to the same fees and percentage (commissions) as might be taxed for the same services had they been performed by the sheriff, not exceeding, in the aggregate, $50. Thus it seems that in this case the referee was clearly entitled, according to the decision in Innes v. Purcell, and under the limitation fixed by the act of 1876 above cited to $50 for the third and consummated sale, inasmuch as the taxable fees and percentage, or legal commissions, on that sale alone would amount to the full sum of $50. But we are of the opinion that be can have commissions only on the consummated sale. He can have commissions only on such moneys as wore actually or constructively received and paid over under the decree. The sum thus made from the sale is deemed to be the sum collected, and it is on that sum that his right to commissions attach. The twenty-five per cent paid in on the first two sales became, in this case, part of the $5,700 ultimately paid on the consummated sale. This latter sum was all that was ever made under the decree. The fact that one referee was substituted for another, during the process of executing the decree in this case, does not at all affect the question before us. There were, however, services performed by the referee on those first two sales, for which he was entitled to compensation the same as if he had been sheriff. It is supposed he was in effect, as regards fees and commissions, performing the duties of the sheriff in executing a judgment. Then let us suppose that, instead of the decree of sale, he had held as sheriff an execution, and had performed the services thereunder, which were performed in making the two ineffectual sales, what were the items of service for which the law would allow to him compensation ? Those fees would have been as follows : For receiving and entering the decree in his book, in analogy to entering an execution, fifty cents; for advertising the property for sale, $2. Perhaps there may be some other item or items of fees given by some statute which has escaped our observation. Mileage is not allowable, for there is no such-service to be performed in the class of cases under consideration. Nor can any allowance be here made for a report of sale on either of the two ineffectual sales, on the hypothesis that the report of sale takes the place of a sheriff’s certificate of sale, for no report of sale was made on either of those sales ; nor for a deed to the purchaser, for no deed was given until given pursuant to the last and consummated sale. Besides the provision as to the sheriff is that the fee for the deed is to be paid by the grantee. Thus, it seems, there is the sum of $2.50 allowable against Mr. James on each of the two ineffectual sales; inasmuch as these fees were for services actually rendered, for which, under the circumstances of this case, he became liable. Thus, it seems, the referee in this case was entitled to fifty-five dollars, and the order of the Special Term should be modified accordingly. But neither party should have costs either at Special Term or on the appeal. It should be here added, perhaps, that the decision in Richards v. Richards (21 Sup. Ct. Rep. [14 Hun], 25), is made with reference to the special statute applicable to the city and county of New York.

Order of Special Term modified so as to make the allowance to the referee fifty-five dollars, but without costs of the Special Term or of the appeal.

BoaRDMAN, J.:

I think there was but one sale made; the others were not perfected, and that the fees should be fifty dollars as the extreme limit of the law of 1876.

Present — Learned, P. J., Bockes and Boardman, JJ.

Order modified, in accordance with the opinion of Bocejss, J.


author: LeaRNEd, P. J.:

text:
    WILLARD E. CHASE, Respondent, v. EDWARD D. JAMES, Appellant.

      Fees of referee — extra compensation, — how agreement therefor must he made.

    To authorize a referee to charge more than §3 per day for his services, there must be a written agreement fixing the exact rate of compensation, which must be signed by the parties or their attorneys before the referee commences to act.
    An entry by the referee in his minutes, with the consent of the parties, to the effect that it was “ agreed that referee may charge the fair value of services,” will not authorize any chai-ge in excess of the statutory fees.
    Appeal from an order made at a Special Term, denying a motion for a readjustment of the costs taxed in this action. The item complained of was the charge for the fees of the referee. The referee was engaged in the business of the reference some fourteen days. His charge was $100.

      jE. II. Bern, for the appellant.

      John O. Hulbert, for the respondent.
   LeaRNEd, P. J.:

The referee has been allowed oyer $3 per day for his services. There was no written agreement to that effect. The referee entered on his minutes a memorandum, as follows: “Agreed that referee may charge the fair value of services.” He testifies that, according to his recollection, it was agreed, during the trial and in open court, in substance, that he should charge the fair value. The plaintiff’s attorney testifies to the same fact. The defendant (attorney in person) denies that there was any such stipulation.

We do not intend to depreciate the value of the referee’s services; but the question presented is one of general importance, out of which serious evils have arisen. It is really unjust that the unsuccessful party should have to pay the fees of the referee, who acts as the court. It is like making the defeated party pay the salaries of the judges. But this evil will probably continue as long as courts are' over-crowded. Still, we must see that no more is allowed than the statute or an agreement permits.

The statute fixes the fees at $3 per day, but permits the parties to “ agree in writing upon any other rate of compensation.” (Code, 313.) We think the view is erroneous which has allowed an entry in the referee’s minutes to take the place of a written agreement. (Thurman v. Fiske, 30 How., 397.) It is true, as was held in Keator v. Ulster & D. Pl. Rd. Co. (7 How., 41), that an agreement to refer in open court is sufficient. But that is a . step in the progress of the trial, entered in the records of the court, and therefore binding on the parties. The referee’s minutes are not records of a court. The agreement for his compensation is a mere matter of private bargain between the two parties and the referee. It is not simply a part of the trial minuted down by the referee. But it is a contract to which he is the interested party. We think that the language of the statute means that there shall be an agreement signed by the parties or their attorneys.

Furthermore, an agreement to pay the. fair value of services amounts to nothing. The law has said that the fair value is $3 per day. If not, who is to judge ? The referee ? He is the interested party. The clerk ? He is but a taxing officer. Is he to take proof of the value ? We think that no force can be given to an agreement of this kind. The Code speaks of a “ rate of compensation.” That means a fixed sum, which shall leave the business of taxation a matter of computation only.

And again, such agreements as to compensation ought always to be made before the referee has accepted his office. When made during the progress of the trial, they are of doubtful propriety. After the referee has commenced to act, if either party proposes that the referee shall have a greater sum than the statute prescribes, the other cannot refuse. He is justly afraid that such refusal may prejudice the referee against him. On the other hand, a party sometimes thinks it is a wise measure to be the first to propose, in the referee's presence, that his compensation shall be some liberal sum. These motives have tended to make attorneys agree on large compensation, each hoping that the burden would fall on the opposing party. If, then, more than the statutory fees are to be allowed, a written agreement fixing the exact fees agreed upon should be made and signed before the referee commences to act. If he is not satisfied with the statutory rate or the rate agreed upon, he can decline to serve. '

Nothing in these remarks is intended to imply that referees ought not to be paid more than the statutory fees. To many persons these fees would be an insufficient compensation.

The order appealed from must be reversed, and the excess over $3 per day should be disallowed, without costs of the appeal to either party.

Present — LeakNed, P. J., BoakdmaN and Bockes, JJ.

Order reversed. Excess of referee’s fees over $3 per diem to be deducted. No costs of appeal.


author: Bocees, J.. LEARNED, P. J.:

text:
    C. A. J. HARDENBERGH, as Supervisor of the Town of Shawangunk, Appellant, v. ELI VAN KEUREN, EDMUND BRUYN, LUTHER HORNBECK and FLOYD S. McKINSTRY, Impleaded with others, Respondents.

      Board of commissioners to issue town bonds — what a breach of duty on its part — Power of Legislature to dispense with consent of toion— When a contract is made, not alterable by th’e Legislature.

    This action was brought against the defendants, on a bond given by them as commissioners of the town of S., under an act authorizing it to issue bonds and take stock in a railroad company. The bond was given in pursuance of the statute,- and was conditioned “for the faithful discharge of their duties.” The complaint alleged as a breach the willful and fraudulent issue of the bonds by the commissioners, in 1867, before the consent of the town had been obtained, as required by the act, with knowledge on the part of the commissioners that such consent had not been obtained; it was further alleged that the bonds had been sold, transferred and delivered to divers persons, and were held by citizens of this and other States.
    As one defense the defendants .set up an act of the Legislature, passed in 1868, expressly ratifying and confirming the acts of the commissioners in issuing the bonds. A demurrer to this defense was interposed by the plaintiff. Held that the complaint set forth a breach of the condition of the bond, and a a cause of action sufficient to justify the recovery of damages therefor.
    That, as the Legislature had no power to compel the town to issue its bonds in aid of the railroad, without its consent, it could not, by a subsequent act, dispense with the condition in the original act requiring such consent as a prerequisite to their issue (per Bocees, J.
    That the bond sued upon was a contract; that the issuing of the bonds, fraudulently and collusively, without the consent required by the act, and with knowledge that such consent had not been had, was a breach of such contract on the part of the commissioners; and that any subsequent Act attempting to relieve them from the liability so created was a violation of subdivision 1 of ■ section 10 of article 1 of the United States Constitution, and void (per Learned, P. J.).
    That the demurrer should be sustained.
    Appeal from an interlocutory judgment, entered at a Special Term of this court, held in Ulster county, overruling plaintiff’s demurrer to a defense in the answers of the defendants, setting up the provisions of chapter 45 of the laws of 1868.
    The action is brought on the official bond of two of the defendants, and their deceased colleague, as commissioners of the town of Shawangunk, under an act of the Legislature authorizing certain towns in the counties of Ulster and Orange to issue bonds and take stock in the "Walkill Valley Railroad, passed May 9th, 1866. (Session Laws of 1866, cli. 880.) The bond was given in pursuance of the ninth section of the act requiring a “bond in the penal sum, equal to the amount to be issued by said towns,” f,and “ conditioned for the faithful discharge of their duties,” etc. The same section provides that the bond shall be deposited with the supervisor, “ to be collected by him, or his successor in office, for the use and benefit of said town, in case the commissioners, or either of them, are guilty of such breach of duty or malfeasance in office as to render said bond collectible.”
    The breach of the bond assigned in the complaint is the willful and fraudulent issue of the bonds of the town of Shawangunk by the commissioners, on the 2d or 3d day of December, 1867, before the consent of the town had been obtained, as required by the provision of the second section of the act. The defenses de-mux-red to interpose an act of the Legislatui-e passed March 20, 1868 (Session Laws of 1868, chap. 45), and sets up the second section as a performance and nullification of the official bond as to matters set forth in the complaint. The following are the provisions of the act interposed as a defense : Section 1. It shall be lawful for the Walkill Valley Railroad Compaixy to use upon their road iron rails, weighing not less than fifty pounds weight to the lineal yard. Section 2. The acts of the commissioners in issuing the bonds of the second election district of the towns of Montgomei-y, in Orange county, and of the towns of Gardiner and Shawangunk, in Ulster comity, in aid of the Walkill Valley Railroad, ai-e hereby ratified and confirmed. Section 3. This act shall take effect immediately.
    The court at Special Term held that by the second section of the latter act, the acts of the commissioners in issuing the bonds were rendered valid, and gave judgment for the defendants on the demurrer, thereupon the plaintiff appealed to the General Term.

      D. M. De Witt, for the appellant.

      F. L. Westbrook, for the respondent McKnnstry.
    When the Legislature can authorize a municipal corporation to do a certain act in a certain manner, or upon a certain condition, which act has, by tbe persons deputed to do it, been done, but in an irregular manner, a subsequent statute legalizing tbe act or healing irregularities in its execution, is valid and operates as a ratification and confirmation of tbe act so done by tbe persons origmally appointed to do it. {People v. Mitchell, 35 N. Y., 551; Town of Duanesburgh v. Jenkins, 57 id., 177; Williams -v. Town of Duanes-burgh, 66 id., 129, 137; Stockdale v. Ins. Qo., 20 Wall., 323,331; The Clinton Bridge, 10 id., 454, 462; 69 N. Y., 367.)

      Winfield, Leeds & Morse, for tbe respondents Van Keuren and Bruyn; William L. Snyder, for tbe respondent Hornbeck.
    Tbe Legislature may, in its discretion, authorize bonds to be issued for local improvements, without tbe consent of any of tbe tax-payers unless restricted by tbe Constitution, {People v. Mitchell, 35 N. Y., 551; S. C., 45 Barb., 208; Williams et al., v. Town of Duanesburgh, 66 N. Y., 129; Town of Duanesburgh v. Jenkins, 57 id., 177; Town of Guilford v. Supervisors, 13 id., 143; Brew-sters. City of Syracuse, 19 id., 116; Starin v. Town of Genoa, and Gould v. Town of Sterling, 23 id., 439; S. C, 1 Am. Law Reg. [N. S.], 290; Grant v. Counter, 24 Barb., -232; People v. Mayor, etc., of Brooklyn, 4 N. Y., 419; Thompson v. Lee Co., 3 Wall. [U. S.], 327; St. Joseph Township v. Rogers, 16 id., 661; Belo v. Forsythe, 76 N. C., 489; S. C., 4 L. & Eq. Rep., 295; Richies. Franklin Co., 22 Wall. [TT. S.], 67; Cooley on Const. Lim., 361, 371; Cooley on Taxation, 223, 232; Dillon on Muni. Cor., §§ 46, 424.) Tbe mode of exercismg legislative power is not a subject for judicial review. {Town of Duanesburgh s. Jenkins, 57 N. Y., 177; Bank of Rome s.. Village of Rome, 18 id., 38; Peoples. Osborn, 57 Barb., 663; People s. Flagg, 46 N. Y., 401; Benson s. Mayor, 24 Barb., 248; West River Bridge Co. v. Dix, 6 How. [U. S.], 532; Walpole s. Elliot, 18 Ind., 258; Tbe Legislature may, by subsequent enactment, supply a power which its agents did not possess when the act was done. (Tanner s. Albion, 5 Hill, 121: Knapp s. Newton, 1 Hun, 268; Bays. Gage, 36 Barb., 447; Bennett s. Fisher, 26 Iowa, 497; States. City of 27 N. J. Law [3 Dutch.], 185.) The act in question doesNewark, not impair tbe obligation of a contract or take away a vested right so as to conflict with tbe United States Constitution, because it is not an action on contract but to recover a penalty. A party has no vested right in a penalty which is a public fund, and may be released by the Legislature. (Mechanics’ Bank v. Bliss, 35 N. Y., 412; Hyatt v..Roach, 52 How. Pr., 115; S. Q., 1 Abb. [N. C.], 125; State v. B. B. Go., 12 Gill & Johns., 436; 8. G., 3 How. [U. S.], 534; Goles v. Madison Go., 1 Breese [Ill.], 154; Harris v. Grocker, 13 How. [IT. S.], 429; U. 8. v. Mann, 1 Galli., 177; U. 8. v. Passmore, 4 Dallas, 372; Wilkinson v. Leland, 2 Peters [IT. S.], 627.) Where a statute is repealed, all proceedings under it must end; and if a penalty be provided, it cannot be enforced, even though an action were pending. Nor can sentence be executed after the repeal of the law under which it was passed, (jPeople v. Hartung, 4 Park. Crim. Cas., 256; Hartung v. People, 22 N. Y., 95; 26 icL, 167.) The Legislature has always exercised the right to control prosecutions for penalties which its own legislation has imposed, at any stage of the proceedings before sentence or judgment. (Gurtis v. Leavitt, 15 N. Y., 9; Butler v. Palmer, 1 Hill, 334; People v. Board of Police, 40 Barb., 626, and cases cited, supra.)

   Bocees, J..

The recent decision in the Court of Appeals in Horton v. The Town of Thompson (6 W. D., 35), not yet reported in the New York Reports, the opinion in which case has been furnished us, seems entirely decisive of the question as to the validity of the curative act of 1868. That decision is based on the principle settled in The People v. Batchellor (53 N. Y., 128), and gives the doctrine of the latter case practical application to the question here presented. In Hartonas case the consent of the tax-payers of the town, as required by law, to the issuing of the bonds by the commissioners, was fatally defective, and a curative law was passed which, in terms, ratified and confirmed the acts of the commissioners in issuing them. The court held the curative act unauthorized and void. Judge Rapallo, speaking for a majority of the court, after remarking that it was claimed that the curative act made the bonds a debt against the town, said : “I think this was beyond the power of the Legislature, and was precisely what it was decided in the case of The People v. Batchellor could not be done;” and further referring to the bond in suit, he added: “The bond not having been originally issued in conformity with the consent of the tax-payers, and that being the only action on the part of the town towards the contracting of the debt, the Legislature had no power to validate the bond unless it had the power to authorize or direct the commissioners originally to contract the debt without any consent or action on the part of the town. This, as was decided in the ISatchellor Case, it had no power to do ; and it necessarily follows that this confirmatory act cannot aid the plaintiff's case. It was not, in this respect, merely curative of an irregularity in the exercise of a power which had been conferred; but it undertook to give validity to an act which had been done without the consent of the town and in violation of law, and which the Legislature had no power to authorize to be done without such consent.” According to this authority the confirmatory or curative act here interposed as a defense is valueless as an answer to the matters alleged in the complaint.

"We might here content ourselves by saying ita lex scripta est; but it may be well to recur to the case of Batchellor in order to see precisely what was there decided, as well as the grounds of the decision. It was there decided that the legislative power over municipal corporations was not supreme; that the latter might be compelled by legislative enactment to provide for subjects of a public character exclusively, or to enter into contracts for exclusively public purposes, yet that the Legislature could not create a debt or authorize a debt to be created against them for a private purpose, or to aid in the construction of works, which, although public in some respects, were private in others ; and further, that railroads belonged to the latter class of works. The ground of the decision will be readily seen by carefully noting the distinction marked by the court between subjects of a purely public character, and those which are private or quasi private in their ends and purposes. The line of reasoning in Batchellor’s case maintains this distinction, and in conclusion it was determined that the Legislature was impotent to impose a debt upon a municipality for a private or quasi private purpose, without its consent, either through its officers or taxpayers; that in this regard there was a limitation of power in the Legislature — that it could legislate only with a view to exclusively public interests, when taxation was necessarily or probably involved in it. So, Judge Sapallo, in speaking of the Batchellor case, says: “ While the opinion in that case recognizes the power of the Legislature to authorize or enable a town or other municipality, acting through its officers or taxable inhabitants, to contraet a debt in aid of the construction of a railroad by a private corporation, it confines the power of the Legislature to conferring such authority, and requires that the contracting of the debt be the voluntary act of the municipality; or that it be done with the consent of the taxable inhabitants; and the case itself is an express adjudication that the Legislature cannot impose such debt upon the municipality without such consent.”. (Horton’s Case, supra.) It may be here noted that the commissioners were not the agents or officers of the town, by whose action the consent of the town will be deemed to have been given. (Horton’s Case, supra.) Thus it seems that the proposition of the learned counsel for the respondents in tins case, that the Legislature could have authorized the bonds to be issued without the consent of the municipality or tax-payers, is not sound; and although it is a sound doctrine, sustained by numerous decisions, that the legislature may validate retrospectively what it might have authorized in advance, yet it could not by a curative act give validity to that which it had no power to authorize to be done originally. The holding that the former part of the above proposition is unsound seems to be in conflict with several cases heretofore decided. (The People v. Mitchell, 35 N. Y., 551; Town of Duanesburgh v. Jenkins, 57 id., 177; Williams v. The Town of Duanesburgh, 66 id., 129.) It is true that the question was not directly before the court in the first two cases cited. In Mitchell’s Oase the learned judge who gave the prevailing opinion, says (page 554), “the fact that a majority consented without qualification, is established by affirmative proof.” Due consent was therefore deemed to have been given. In Jenkins’ Oase, JOHNSON, J., speaking for the Commissioners of Appeals, held that the issuing of the bonds by the commissioners vías consent by the town to the incurring of the debt. He says (page 191) : “ The only officer of the town, who had any duty in the premises, acted by giving the bonds; and the Legislature, seeing the whole matter, released the condition which it had imposed, and declared his assent binding upon the town, if the bonds had been issued and the road had been built, and the bonds in that case obligatory;” He added: “As it might have authorized action in this way and on these conditions by the town originally, I see no objections to giving effect to its ratification of the action of the town and holding its consent thus expressed effectual.” But this ruling by the Commission of Appeals was expressly repudiated by the Court of Appeals in Horton’s Case, and must now be deemed overruled. In Williams’ Case, the entire subject was again discussed, and Batchellor’s Case was especially considered; and AlleN, J., there says that the judgment pronounced in Batchellor’s Case went far towards overruling, directly and in terms, the former decisions on the subject; and further, that such was the logical and necessary sequence of that judgment; and that there was no ground upon which it and the cases which preceded it could be reconciled or made consistent. The court settled down, however, in Williams’ Case (if the reporter has succeeded in properly extracting what was there, in fact, decided), upon this rule, that where, in pursuance of legislative enactment, municipal bonds have been issued and transferred to purchasers for value, prior to the decision in The People v. Batchellor, they are protected by the earlier decisions, and as far as their validity depends upon the constitutional power of the Legislature, will be sustained. This ruling would, in effect, seem to uphold the defense to which the demurrer is here interposed, inasmuch as the bonds are alleged to have been sold and transferred to various persons prior to the decision in the Batchellor Case. But, then, we have the more recent decision in Horton’s Case on a state of facts on all fours with the case in hand, and to this, at least for the time being, we owe obedience. Thus, then, we are brought to the rule decided in Horton’s Case, that the Legislature could not authorize the issuing of the bonds without the consent of the municipality duly given; that it was not duly given by the issuing of the bonds by the commissioners, and that if the Legislature had no power to authorize the issuing of the bonds without the consent of the town, it was equally impotent to pass the affirmatory act of 1868 (chap. 45). It follows, from the above conclusions, that the curative act of 1868 was and is unauthorized and void, hence valueless as a defense to the matters stated in the complaint. We must now examine that pleading, in order to see whether a cause of action is there averred; because, if no cause of action be there stated, the defendants would still be entitled to judgment on the demurrer. The right of the supervisor to maintain the action for a breach of the bond in suit is undoubted. The ninth section of the act of 1866 (chap. 880) provides that the bond required to be given by the commissioners shall be deposited with the supervisor of the town, “to be collected by him, or his successors in office, for the use and benefit of the town, in case the commissioners, or either of them, are guilty of such breach of duty or malfeasance in office as to render the bond collectible.” The action is well brought by Mr. Har-denbergh as supervisor of the town.

The condition of the bond was to the effect that the commissioners should faithfully discharge their duties as such commissioners for the town under the act, and should justly and honestly apply all moneys, stocks or bonds issued by them or coming into their hands as such commissioners, according to the true intent and meaning of said act. The breach alleged was that the commissioners did not faithfully discharge their duties in this (1) that they willfully, collusively and fraudulently issued the bonds without the consent of the town as the law required; and (2) that they retained in their hands and failed, and omitted to apply as the law required the sum of $201, which came to them as commissioners. This last alleged breach of the bond was withdrawn on the argument by consent of counsel, and was expunged from the record. The breach relied upon, given more in detail, is this: That the commissioners willfully, collusively and fraudulently issued the bonds which purported to have been executed under the act, knowing that the consent of a majority of the tax-payers had not been obtained as the law required ; and it is averred that such consent never was obtained ; and further, that the bonds had been sold, transferred and delivered to divers persons, and were held by citizens of “this and other States.” It was also averred that the commissioners made their report to the board of supervisors from year to year as the law directed, and that thereupon large sums of money were assessed upon, and were levied and collected from the town. These averments are quite sufficient by way of alleged breach of the instrument in suit. True, according to these averments (and they stand admitted on the demurrer), the bonds issued by the commissioners had no validity ; certainly none, save perhaps as they should be held by bona fide holders; but if issued by the commissioners in due form with proper recitals, showing on their face full compliance with the law under which they were issued, and so passed to bona fide holders, it may be that the vice in their origin cannot be urged as a defense. (Cromwell v. County of Sac., 96 U. S. Rep. [6 Otto], 51; Com’rs. v. Clark, 94 id., 278; see remarks of Clifford, J., on page 287, and authorities there cited; also Bank of Rome v. Village of Rome, 19 N. Y., 20; Brainerd v. N. Y. and H. R. R. Co., 25 id., 496.) But we do not here propose to pass upon the question of the validity of the bonds, issued by the commissioners, in the hands of" bona fide holders, as that question is not necessarily brought up by the demurrer. If the commissioners put the bonds in circulation, knowing of their invalidity, because of the omission to obtain the consent of the town to the incurring of the debt, in consequence of which the town has been or may be compelled to raise money to meet the claims, or any part of them, there was a breach of their obligation, by which they were bound to a faithful performance of duty. The issuing of the bonds without authority, knowingly, was at least, technically, an unfaithful performance of their duty as commissioners. It is out of place here to lay down a rule of damages for the trial of the case. The damages, beyond nominal damages, are matters of proof. All we decide here is that, according to the averments of the complaint, there was a breach of the condition of the bond in suit, and that the act of the Legislature, interposed as a defense, is valueless for the • purpose for which it is pleaded. The conclusions hereinabove stated lead to the reversal of the judgment ordered for the defendants on the demurrer, as directed at Special Term. It is presumed that the defendants will not care to amend, as this decision does not affect the other matters of defense interposed; and besides, if correct in our conclusions, an amendment cannot be made which will make good the alleged defense challenged by the demurrer.

Order and judgment appealed from reversed, with costs of Special and General Terms against the defendants, to be allowed on the entry of final judgment in the case, and judgment ordered for the plaintiff on the demurrer.

BoardmaN, J., concurred. LearNED, P. J., concurred in the result. See the following opinion:

LEARNED, P. J.:

The complaint alleges that the defendants, on the 26th of January, 1867, with certain persons since deceased, executed to the plaintiff, a supervisor, a bond conditioned, among other things, that Van Keuren, Bruyn and Radiker, commissioners for the town of Shawangunk, should faithfully discharge their duties as such commissioners, etc. It alleges, in substance, for a breach of the condition, that about the 3d of December, 1867, the commissioners, without obtaining the consents required by the act, and knowing that such consents had not been obtained, unlawfully, willfully, fraudulently and collusively executed, issued and transferred certain bonds of the town to a railroad company, and that that railroad company has transferred the same to divers persons, and that the bonds are held by citizens of this State and of other States. The defendants, among other things, allege for answer an act of the Legislature of New York, passed March 20, 1868, ratifying and confirming the acts of the commissioners in issuing these bonds. To this the plaintiff demurred. The court below ovei'-ruled the demurrer, and the plaintiff appealed. As it seems to me the bond sued upon was a contract. The issuing of the town bonds, fraudulently and collusively, without the consents required by the act, and with knowledge that such consents had not been obtained, was a breach of that part of the condition which required a faithful discharge, by the commissioners, of their duties. By such breach a liability was caused for the damages consequent thereupon. Any subsequent legislation which relieved, ’ or attempted to relieve, the obligors on that bond from their liability for the damages occasioned by such breach, would, in that respect, be an attempt to impair the obligation of a contract, and hence would be void under the Constitution of the United States. It is not, perhaps, necessary to say whether the act of 1868 was, or was not, valid for some purposes; for instance, as respects the bonds themselves, and as between the town and the bond-holders. But the defendants claim for that act the same effect as if it had declared, in express terms, that the obligors in the bond given by the commissioners to the supervisor should not be liable for a certain breach of the condition already committed. I think the Legislature had no power to do this, if the act of 1868 has, by its terms, that effect. If it had not, then, of course, it constitutes no defense.

Whether the act of 1868 made the bonds valid as against the town may, perhaps, effect the question of damage, which is not before us. If the bonds are still invalid, the defendants may, perhaps, claim that the town suffered no damages by the wrongful action of the commissioners. If the bonds are now valid, the plaintiff may perhaps claim that the liability on the bond is owing to that wrongful action.

Without, therefore, attempting to discriminate and select from the conflicting decisions as to the effect of a (so-called) curative act upon the bonds, I think, for the reasons given, that the act of 1868 could not relieve the defendants from the liability which (for the purposes of the demurrer), it is admitted that they had already incurred.

And I concur in the result of the foregoing opinion.

Present — LeaeNed, P. J., BoakdmaN and Bocees, JJ.

Judgment overruling demurrer reversed with costs of Special and General Terms to be allowed on final judgment, and judgment interlocutory ordered for plaintiffs on demurrer.


author: LearNed, P. J.:

text:
    WILLIAM YOUMANS, Respondent, v. APOLLOS C. EDGERTON, Appellant.

      Contract for sale of land —liability of assignee of vendor’s contract, for breach by such vendor — Mutual misbalte — when money paid under, not recovemble.

    A. contracted to sell land to B., and then for a valuable consideration assigned his contract with B. to C.; B. subsequently paid C. the contract-price, but A. refused to convey the land to him.

      Held, that B. could not maintain an action against C. for breach of contract, nor on any implied liability arising from failure of consideration, unless C. contracted with A. to fulfill the contract.

      Held, further, that if C. was a purchaser for value, the fact that both B. and C. believed that A. had title to the premises, although in fact he did not, would not enable B. to recover the money paid to C., as money paid under a mutual mistake of fact.
    That B.’s remedy was against A. for breach of contract, if, after a demand, he failed to give a good and sufficient conveyance of the premises.
    Appeal from, a judgment in favor of tbe plaintiff, entered upon tbe report of a referee.
    Tbe action was brought by tbe plaintiff as assignee of William T. Kilmer and Jobn Hodge against defendant, to recover money paid on a contract for tbe purchase of land, made by Kilmer with one James R. Shaver.
    One Knapp was tbe original owner of lot number eleven, in regard to which this claim arises. In 1859 he entered into a written contract to sell this lot for $600 to Townsend Shaver, and to give him a warranty deed; the last installment payable June 1, 1865. Townsend Shaver went into possession and remained in possession till he sold to James R. Shaver, but paid nothing. In 1864, Townsend Shaver made a written contract with James R. Shaver to sell him this lot for $1,097.84, and to give him a warranty deed, the last installment payable June 1, 1869. James R. Shaver went into possession and remained in possession till he sold to Kilmer. The referee finds that there is no evidence of payment on this contract. In February, 1867, James R. Shaver made a written contract with Kilmer to sell him this lot and lot ten for $1,500, and to give a good and sufficient deed, the last installment payable June 1, 1874. Kilmer soon after paid Shaver $200, and took possession. After-wards, in April, 1867, James R. Shaver, for a good and valuable consideration, sold and delivered the last-mentioned Kilmer contract to the defendant, and assigned it to him by a written assignment thereon. The defendant took this assignment in good faith, and paid the full value thereof, and soon after gave Kilmer notice that he held the contract. James R. Shaver did not assign to the defendant the contract which he held of Townsend Shaver, unless such assignment is to bo inferred from the assignment of the Kil-mer contract. The defendant made no agreement with James R. Shaver to perform the Kilmer contract. Afterwards Kilmer gave the defendant a chattel mortgage, from which the defendant, about April, 1869, realized $200 as a, part payment on the contract. Afterwards, and in April, 1869, Kilmer assigned, in writing, to one Hodge his contract with Shaver. Kilmer agreed to pay Hodge $200, and the amount that Hodge should pay, and Kilmer was to remain in possession. Kilmer did remain in possession till 1873, and then the premises were occupied by one Bryden, under Hodge, for about a year, and till the spring of 1874. On the 15th of April, 1874, Hodge entered into a written contract with one Keeler and one Wilson to sell them the lots ten and eleven for $1,700. They took possession of the premises till the fall of 1874, when they agreed with Hodge to abandon, and did abandon the premises. At sundry times, between April 20, 1869, and June 10, 1874, Hodge made payments to defendant on the Kilmer contract, and the last payment fully paid it up. In December, 1874, Hodge assigned the Kilmer contract to the plaintiff, and also all causes of action against Shaver and the defendant for breach of contract.
    At the time that Hodge made the last payment to the defendant, he demanded a deed of the premises. On defendant’s refusal, Hodge demanded back the moneys paid by him. The referee finds that all of the payments, except the last, were made and received in ignorance of the fact that Knapp had the title, and in the belief that James R. Shaver had a good title when he entered into the contract with Kilmer. It was claimed by the plaintiff and denied by the defendant, that the defendant promised Hodge to give him a deed on the fulfillment of the contract. The referee, in his opinion, states that he makes no finding on that point. The referee held that the plaintiff was entitled to recover back of the moneys paid to the defendant, such proportion as the value of lot number eleven bore to the. whole moneys, excepting such last payment, which was made with knowledge.

      O. W. Smith, for the appellant.

      Youmans & Niles, for the respondent.
   LearNed, P. J.:

The plaintiff claims to recover this money on two grounds. First. As money paid upon a consideration which has failed. Second. As money paid under mutual mistake of fact.

First. The question presented in the first ground is this: If A. contracts to sell land to B., and then for a valuable consideration assigns B.’s contract to C., and if B. pays C. the contract-price, and then A. refuses to convey, can B. recover from C. for breach of contract or failure of consideration? It seems to me that he cannot, unless C. has contracted with A. to fulfill the contract. Then, under the doctrine of Lawrence v. Fox (20 N. Y., 268), B. might have the benefit of C.’s agreement with A. If, for instance, A. had not only assigned the contract, but had also conveyed the land to C., on consideration that C. would perform the contract, then probably B. would have au action on- C.’s agreement. But in the absence of any such contract, and if C. had taken from A. only an assignment of B.’s contract, I cannot see that C. would be liable to B. Suppose that by the terms of the agreement B. was to give, and should give, his notes to A. as a consideration for the land. If A. transferred the notes to C., they would carry with them no obligation on C.’s part to perform the contract of sale.

So, in the present case, the plaintiff has taken Hodge’s rights by assignment; Hodge took Kilmer’s rights in the same way. The plaintiff then stands in Kilmer’s place, and the only person with whom Kilmer had a contract was James R. Shaver. No one else has ever agreed to convey to Kilmer or to his assignees. The defendant paid Shaver in full and only received a transfer of Shaver’s right to collect the payments on the contract. He assumed no contract himself. And it should be observed that, strictly, this is not the case of a failure of consideration, but of breach of contract. The consideration for the payments made by Hodge was the contract on Shaver’s part to convey. His contract was executory. On performance by Kilmer’s assignee, the assignee had a right to demand a deed. If Shaver did not, or could not give a good and sufficient deéd, then the action against him would be on the breach of contract — on the breach of the written contract — not on any implied liability for failure of consideration. Thus in Fletcher v. Button (4 N. Y., 396), and in Lawrence v. Taylor (5 Hill, 107), both cited by the plaintiff, the action was in each case brought for the breach of the written obligation to convey the land.

The contract, then, was with Shaver, and there is no finding, and, so far as I can see, no evidence, that the plaintiff has ever demanded a deed from him. It is true, that the referee finds that the legal title was in Knapp up to the commencement of the action. But it does not follow conclusively from this fact, that James R. Shaver, if demand had been made of him, would not have obtained, through the Townsend Shaver contract, a good deed from the owner. At any rate his refusal should have been shown.

Second. The plaintiff claims to recover this money as paid under a mutual mistake of fact; and this is the view taken by the learned referee. It is very important to see exactly what the mutual mistake is on which the recovery is claimed. The money was paid severally by Kilmer and by Hodge to the defendant. The learned referee finds that when the payments (excepting the last) were made and received, Kilmer, Hodge and the defendant were in ignorance that Knapp had the title to the lot, and that they believed that at the time when James R. Shaver made his contract with Kilmer he had a good title.

Now, I have already pointed out that the defendant was a bona fide purchaser for full value from Shaver of the moneys to be received on the Kilmer contract. It will readily be seen, therefore, that the principle of recovering money paid under mutual mistake will not apply to Mm, unless it would apply to Shaver, if he had not assigned to the defendant. Suppose, then, for a moment, that Kilmer and Shaver had made this contract under the mutual mistake (so called) above stated, and that Kilmer had paid Shaver under like mistake, what would have been Kilmer's remedy ? Not an action for money paid under mutual mistake, but, as already pointed out, an action for breach of contract upon the failure of Shaver to convey. The cases referred to by the learned referee are cases of an executed contiact; where, for instance, a deed has been given and the consideration paid, but the grantor had no title. Now, in the present case, it was not important that Shaver had no title when he executed the contract, if, when it was paid up, he was able to give a good deed which should convey the title. If he was unable then to convey, he was liable on his contract. Money is not paid by mistake when it is paid on an executory contract, and the consideration for the payment is the agreement of the other party.

But further, an action to recover back money paid by mistake is a strictly equitable action, based on the idea that the defendant ought not to retain that for which he has given nothing. Now, the defendant in this case has given the full value for the money he has received. He purchased from Shaver the claim against Kilmer. Shaver, now it is said, cannot perform' his part of the contract with Kilmer. It is then Shaver who holds, in this view, money which he ought to refund; not the defendant. The defendant has only received back what he paid to Shaver. The plaintiff’s assignor trusted, not to the defendant’s promise, but to Shaver’s. To illustrate, suppose that Shaver had given Hodge a deed, and had taken Hodge’s note or bond for the purchase-money, and had then, for value received, transferred the note or bond to the defendant, and Hodge had paid the same to the defendant. If subsequently it should have proved that Shaver had no title, and Hodge should have sought to recover back the money as paid under mistake, against whom would the action lie, if at all ? Clearly against Shaver, who had profited by the transaction; not against the defendant, an innocent party, who had not profited by it. If the present recovery be sustained, then the defendant is left remediless; and Shaver, the party who is confessedly to blame, retains all the benefit of the contract. For the defendant would seem to have no remedy against Shaver, and Shaver has bad full payment on the contract. It was proved on the trial that Shaver is insolvent. That fact accounts probably for the attempt to make the defendant liable. But, of course, Shaver’s insolvency is no reason for the defendant’s liability. The plaintiff urged, on the trial, that there was evidence that the defendant agreed with Hodge to give him a deed. An examination of the case on this point satisfies me that this was not ■proved. Some other questions áre presented as to the allowance of interest before demand, and as to the effect of the plaintiff’s possession, and of the assignment to him of the contract, and of the want of an actual surrender. But it is unnecessary to pass upon them.

The judgment should be reversed; a new trial granted; reference discharged;' costs to abide the event.

Present — LearNed, P. J., BoardmaN and Bocees, JJ.

Judgment reversed, and new trial granted; reference discharged; costs to abide event.