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

text:
    Nassau Bank, App’lt, v. George B. Yandes, as Assignee of Augustus W. Ritzinger et al., Impleaded, etc. Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    1. Interpleader—When stakeholder entitled to bill of.
    A stakeholder has always the right, where there are conflicting claims to money or property in his Hands, to go into court and to deposit the money or property in court and leave the litigation of the question to be carried on between the conflicting claimants.
    2. Same—There must be reasonable doubt.
    The rule now is that a reasonable doubt, as to who is entitled to the money, etc , must exist in order to justify the bringing of an action of • interpleader, and that, any doubt is not sufficient. Atkinson v. Manks, 1 Cow., 705, overruled.
    3. Assignment—Yerbal assignment of bank account valid.
    A verbal assignment of a balance of account in bank is valid; the bank is liable to suit to recover such balance by the assignee, and is required to. take the risk of the existence of facts the evidence of which íested exclusively, perhaps, with the assignee and claimant.
    4. Assignment in another state for benefit of creditors—When can-'NOT BE ATTACHED COLLATERALLY.
    The general assignee for the benefit of creditors, in the state of Indiana, having made a demand for certain money in the plaintiff bank before certain attachment suits were commenced, the assignments having been' proved to have been executed according to the laws of Indiana and to have been valid there, the sheriff could not in an action here in aid of an attachment attach the same upon the ground that it was made with fraudulent intent.
    5. Contract—Governed by law of place where made or performed.
    The law of a place where a contract is made or to be performed is to govern as to the nature, validity, construction and effect of such a contract, and being valid in such place, it is to be considered and enforced everywhere with the exception of cases in which the contract is immoral or unjust or in which the enforcing it in a state would he injurious to the rights, interests or convenience of such state or its citizens. Per Van-Brunt, P. J.
    '-6. Practice—Attachment—What can be taken under—Right of SHERIFF TO BRING ACTION—CODE OlV. PRO., § 708.
    An attaching creditor cannot attach the property claimed to he that of his debtor, consisting of choses in action incapable of a manual delivery, when they have been previously assigned and transferred by him to another party; and being incapable of seizure under the attachment, the sheriff has no authority for bringing or maintaining an action against the debtor for the recovery of the amount of the debt. It is only when the debt itself may have been attached that he can bring an action under Code Civ. Pro., § 708, subd. 4. Per Daniels, J.
    Appeal from a judgment refusing a bill of interpleader. On February 1, 1886, and for several years prior thereto, the defendants Augustus W. Eitzinger and Frank L. Eitzinger were partners in business at Indianapolis under the .firm name of Eitzinger & Co. Prior to said date the said .firm had procured the plaintiffs, the Nassau Bank, to discount five notes for $5,000 each,- and had given to the plaintiffs, to secure the payment of said five notes, a quantity of commercial paper and 230 shares of the capital ¡stock of the Franklin Insurance Company of the par value of fifty dollars each. On said February 1 the said firm at Indianapolis aforesaid made and delivered an assignment in writing duly signed and acknowledged by each of them, by which they assigned and conveyed all their property of •every kind and nature, and wheresoever situate, to the defendant George B. Yandes in trust for the benefit of the creditors of the assignors equally and without- preference. This assignment on said date was duly filed and recorded in the office of the clerk of Marion county, State of Indiana, ■and a true and correct copy of the assignment was duly filed in the office of the clerk of said Marion county. The defendant Yandes on the same day accepted said trust in writing. On the second of February the assignee took his oath of office and filed his official bond, duly executed and with sufficient sureties and duly approved.
    The assignment was the free and voluntary act of the assignors, and was a voluntary or common law assignment, as distinguished from a statutory or compulsory one, and was valid in the state where it was made and where the .assignors and assignee then lived. The plaintiffs had notice of said assignment on the day of its date. After the making and delivery of the assignment, and the acceptance of the trust by the assignee, and the doing of the several acts above mentioned, divers creditors (defendants herein) of said firm brought actions against said firm in the state of New York and obtained attachments against the property •of the firm on the ground that the members thereof were non-residents of the state of New York. Said attachments were served on the plaintiffs between the 3d of February, 1886, and the lltH of February, 1886, inclusive, and amounted to the sum of $4,731.65. Prior to May 20, 1886, all the paper deposited as collateral to the five notes and other indebtedness of the firm of Ritzinger & Co. to these plaintiffs had matured and had been collected, except some unpaid and protested paper; and on the 20th of May, 1886, all the indebtedness of every kind from said firm to the plaintiffs had been paid. After payment of said indebtedness there remained in the hands of the plaintiffs the sum of $5,856.03, the proceeds of the collaterals, the 230 shares of insurance stock, and the protested notes hereinbefore mentioned. On the said 20th of May, 1886, the defendant Yandes, as assignee, demanded from the plaintiff said cash, insurance stock and unpaid paper, and the plaintiffs refused to comply with the demand, and, on the 25th of said May, said assignée brought and action in this court against the plaintiffs to recover said money, stock and protested paper. The attachment suits hereinbefore mentioned having gone to judgment (although upon no personal service on the defendants Ritzinger or appearance by them), the defendant Grant, as sheriff, began an action on or about July 20, 1886, against these plaintiffs to recover the cash, protested notes and insurance stock mentioned in the complaint herein, as property which had been attached and levied upon as the property of said Ritzingers, and in said action said sheriff claimed possession of said cash and property as subject to said attachments, and that said attachments took precedence over the title of the assignee. Both of said actions were pending at the time of the commencement of this action. The plaintiffs thereupon filed their bill of interpleader against the assignee, the sheriff and the attaching creditors, asking that the defendants might be called upon to interplead and settle their rights to said money and property amongst themselves, and the plaintiff be at liberty to pay said sum of money into court and deposited said property in court. Upon the trial of said action the court rendered judgment in favor of the defendants, and from such judgment this appeal is taken.

      George A. Strong, of counsel, for app’lt; Francis C. Barlow, of counsel, for resp’t Yandes.
   Van Brunt, P. J.

A stakeholder has always the right where there are conflicting claims to money or property in his hands, to go into court and ask to deposit the money or property in court, and leave the litigation of the questions to be carried on between the conflicting claimants. The question which is presented upon this appeal is as to what it is necessary for the plaintiff to establish in order to show that there are conflicting claims. • It is claimed upon the part of the plaintiff that all that is necessary for the stakeholder to establish is that suits have been brought or suits have been threatened by divers claimants to the same fund in order to entitle him to the protection of the court, and that the stakeholder is entitled to be removed beyond the shadow of risk in paying over the money where antagonistic rights are asserted. This view is undoubtedly sustained by the opinion of the court in the case of Atkinson v. Manks (1 Cow., 705), where the court say in substance that where a party had forbidden a stakeholder to pay over money to another and threatened him with a suit, the stakeholder was not bound to exercise any judgment upon the subject. This rule, however, does not seem to be the prevailing rule now in reference to this matter. As all business is conducted with some risk, as every holder of money in the payment of it over, always does so at some risk, the courts have receded from the rule that all that it .is necessary to establish is that some claim had been presented, and have held that it is necessary in addition, to-prove that such claim had some reasonable foundation, and that there was some reasonable doubt as to whether the stakeholder would be reasonably safe in the payment over of the money. It is claimed that because the defendant, the assignee, came to the plaintiff with an asserted voluntary general assignment made in the state of Indiana, that this related to a fact which the bank could not know, and that the bank could not know whether the assignment was a valid and voluntary assignment by the laws of Indiana, and that therefore the plaintiff was not required to take .the risk of the existence of all those facts. It has been held by the courts of this state that a verbal assignment of a balance of account in bank was valid, and the bank was liable to suit to recover such balance by the assignee, and that the bank was required to take the risk of the existence of facts, the evidence of which rested exclusively perhaps with the assignee and claimant. Risley v. Phenix Bank, 83 N. Y., 318. And, as has been observed, no business can be conducted without hazard; the plaintiff in the payment out of the money of its depositors upon their checks takes-a risk of the forgery of the check either in. the maker’s signature or in the filling in of the amount; in its transactions with its customers it runs a risk that the indorsements of commercial paper may also be forged, and it get no title, and therefore the courts seem to have inclined to the rule that a mere pretext of a conflicting claim is not enough to show that the plaintiff is in any danger of loss from inability to determine to whom a debt should be paid. In the case of the Baltimore and Ohio R'y Co. v. Arthur (90 N. Y., 234), it was held that the plaintiff in an action of interpleader must, show that there is some question as between the claimants to be tried and that he will incur hazard in paying to either.

In the case of Dorn v. Fox (61 N. Y., 264), the court lay down the following rule: “The rule requiring that in actions of interpleader the plaintiffs should be in doubt as to which of the claimants is in the right must be construed in a reasonable manner. It qj: course excludes all cases where the rights of parties are clearly settled. On the other hand, so long as a principle is still under discussion * * * it would seem fair to hold that there was sufficient doubt and hazard to justify the protection which is afforded the beneficent action of

It is not necessary to consider other authorities in order to show that the rule now is that a reasonable doubt must exist in order to justify the bringing of an action of inter-pleader and that any doubt is not sufficient as was said in the case of Atkinson v. Manks (supra).

We are then brought to the question as to whether there is any reasonable doubts as to the rights of the assignee of Bitzinger & Co., and of the attaching creditors of said firm to said fund. It is the settled law of this state that the law of the place where a contract is made or to be performed is to govern as to the nature, validity, construction and effect of such a contract and being valid in such place it is to be considered valid and enforced everywhere with the exception of cases in which the contract is immoral or unjust or in which the enforcing it in a state would be injurious to the rights, interests or convenience of such state or its citizens. Andrews v. Herriot, 4 Cow. , 510. This rule is recognized in Guillander v. Howell (35 N. Y., 657), and Warner v. Jaffray (96 N. Y., 248). It is true that in the case of Guillander v. Howell it was held that an assignment made in the state of New York, of property then being situate in New Jersey, which was void under the laws of New Jersey carried no title to the property in New Jersey. This conclusion was arrived at because the assignment in question contained preferences which were contrary to the law of New Jersey, and that as the property was within the exclusive jurisdiction of New Jersey, and as that state protected and regulated it, and as the laws of New York had no force in New Jersey as laws, but were by comity only enforced as to a transfer of personal property valid in New York, except when injurious to her citizens there, the laws of New Jersey when in conflict with the laws of New York in respect to the transfer of such property must control. The same principle was recognized in the case of Warner v. Jaffray, and these are exceptions to the rule which has long prevailed that personal property has no locality, but must be governed by the law of the domicil of its owner. Therefore it seems to be established beyond a reasonable doubt that the property of Ritzinger & Co., held by the Nassau Bank passed to the assignee by the assignment made in Indiana on the 1st of February, 1886.

The next question to be considered is, has the sheriff or the attaching creditors acquired any rights by virtue of their attachments and the levy thereon ?

The sheriff may collect and receive all debts effects and things in action attached by him and he may maintain any action or special proceeding in his own name of the defendant which is necessary for that purpose or to reduce to his actual possession an article of personal property, capable of manual delivery, but of which he has been unable to obtain possession. This, however, gives neither the sheriff nor the attaching creditors any right to attack the assignment on the ground that it was made with intent to hinder delay and defraud the creditors of the assignors. He can bring suits to collect debts and to reduce to possession personal property the legal title to which is in the defendant in the attachment suit; but he cannot maintain an action to remove an obstacle to the attachment. Gibson v. National Park Bank, 98 N. Y., 87; Moseley v. Moseley, 15 id., 334.

Title passes even by a fraudulent conveyance if executed, and consequently the title passed under the assigment in question to the assignee, even though it may have been a fraudulent conveyance. The sheriff, therefore, the assignment having been proved to have been executed according to the laws of Indiana and to have been valid there, could not in an action here in aid of an attachment attack the same upon the ground that it was made with fraudulent intent. Thurber v. Blanck, 50 N. Y., 80.

It is necessary that such an action as respects personal property should be brought by the judgment creditor after his remedies at law have been exhausted. But it is claimed that the sheriff in the actions which he has brought against the plaintiff might show that the assignment was invalid even in Indiana, and that by the finding of the court in this action he is not precluded from so doing. This suggestion seems to be answered by the proposition which has been heretofore discussed, namely, that in order to entitle to judgment in an action of interpleader, the plaintiff must show that there is reasonable ground to suppose that the title of one of the claimants is uncertain. _ There is no pretense in the proofs that there is any claim on the part of the sheriff that the assignment in question was not valid according to the laws of Indiana; and if there was such pretence, there is nothing whatever in the case to show that any such claim has the slightest foundation in law. The mere fact of what the sheriff may claim or may not claim, does not raise the reasonable doubt required by the law, but such reasonable doubt must be supported by proof, raising a question upon which the court may pass judicially.

The result, therefore, is that the judgment appealed from must be affirmed, with costs.

Brady, J., concurs in the result.

Daniels, J.

The property in controversy in this action consists of an indebtedness of the plaintiff to the defendants, Bitzingers, in the sum of $5,856.03, and 230 shares of insurance stock, together with three protested notes. This sum is the balance remaining owing by the plaintiff out of the proceeds of paper held as collateral by it, upon which a further sum had been collected sufficient to pay and extinguish its own indebtedness. This balance was a debt existing against the plaintiff, and when the attachments were issued which were mentioned in the complaint, it could be not otherwise seized than by the service of a copy of the attachments with notice showing the property attached, as that was provided for by subdivision 3 of section 649 of the Code of Civil Procedure. The protested notes, if the creditors had been desirous of seizing them under the attachment, might have been actually taken by the sheriff. But as they do not appear to have been of any actual value, no attempt was made to levy by the attachment upon them in that manner. Neither did the sheriff attempt to make any actual seizure of the 230 shares of stock. But for the purpose of attaching this property as well as the indebtedness of the bank, copies of the attachments, with the notices allowed to be served by this section of the Code, were served upon the plaintiff, and it is upon the judgments recovered in the actions in which the attachments were issued, and without any personal service of the summons upon the debtors, that the sheriff has brought his action against the plaintiff to recover this balance of the indebtedness and the other property mentioned.

But as the debtors themselves executed and delivered a general assignment of their property for the benefit of their creditors, in the manner in which that was authorized to be done by the laws of the state of Indiana, before either of the attachments had been issued, the indebtedness now in controversy did not become subject to the attachments. So much of the property as was capable of manual delivery was required to be taken into the sheriff’s actual custody, to constitute an attachment or seizure of it by subdivision 2 of section 649 of the Code. No such seizure was made either of the protested notes or of the shares of stock. As to those articles the sheriff accordingly acquired no lien upon them under the attachments, and he had no title whatever upon the facts, as they were made to appear beyond controversy, upon which he could maintain any action against the plaintiff. The attachments were likewise entirely inoperative upon the balance of the indebtedness owing by the bank to the debtors. For after an assignment of such an indebtedness has been made, it is incapable of being seized under attachment issued against the assignor. This was considered very fully in Thurber v. Blanck (50 N. Y., 80), and it resulted in the determination that property incapable of manual delivery, after its assignment, could not be reached by its seizure through the medium of an attachment, but that the remedy of the creditor to recover it was by a proceeding in equity to set aside the assignment or transfer when that might be done, after the recovery of a judgment, and the issuing and return of an execution upon it. The same view was adopted and maintained in Smith v. Longmire (24 Hun, 257), and it was so far also followed in Bates v. Plonsky, 28 id., 112.

These authorities all agree in maintaining the inability of an attaching creditor to attach the property claimed to be that of his debtor, consisting of choses in action incapable of a manual delivery, when they had been previously assigned and transferred by him to another party and being incapable of seizure under the attachments, the sheriff has no authority for bringing or maintaining an action against the debtor for the recovery of the amount of the debt. For it is only when the debt itself may have been attached that the sheriff has been authorized to maintain an action for its recovery, by virtue of subdivision 4 of section 708 of the Code of Civil Procedure. Neither as to the protested notes, inasmuch as they were not actually attached or taken into the sheriff’s custody, nor the shares of insurance stock which might have been seized in the same manner, nor the balance of the indebtedness due from the bank, did the sheriff acquire any right to recover in the action brought by him against the plaintiff. His inability to maintain the action and his failure to secure a legal seizure of any part of the property or indebtedness in dispute, appear clearly and beyond controversy upon the face of his proceedings. As to the effect of what has been done by him, no legal uncertainty remains under the construction which has been given to the provisions of the Code by the authorities which have been cited. The plaintiff was accordingly in no legal danger whatever and subjected to no possible risk from the proceeding on the action taken by the sheriff, and it accordingly was not in a position in which it could require either the sheriff or the creditors in the attachments to be interpleaded with the assignee under the general assignment, for the determination of the right to or disposition of this property. The title of the assignee, as it has been established and shown in the opinion of the presiding judge, is free from legal dispute, and neither the money or property can justly be withheld from him by the plaintiff as long as it so plainly appears that the adverse claim is entirely devoid of legal foundation. If the creditors represented in the attachments can maintain a paramount right to this indebtedness, that can only be done after judgments recovered by them against their-debtors and the issuing and return of executions, and the successful impeachment of the assignment through the intervention of creditors actions. And as neither the debtors nor the assignee were within this state, it follows that this remedy even of the attaching creditors must be pursued where personal service of process can be made upon them, or their appearance can otherwise be enforced in actions commenced against them. Until the title of the assignee shall be set aside or superseded in this or some other legal manner, or a lawful seizure shall be made, he is entitled to the balance of the indebtedness and property in dispute, and neither the attaching creditors nor the sheriff acting in their behalf have even a colorable claim upon which they can resist the right of the assignee to this balance and the property.

The judgment in the case as directed by the presiding judge, in his opinion, should therefore be affirmed.

Brady, J.. concurs in the result.


source: Caselaw Access Project

author: Macomber, J.

license: Public Domain

text:
    Robert Beatty, Resp’t, v. Joseph Clark et al., Resp’t.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Evidence—Books of account—What foundation for their admission NECESSARY.
    To enable a party’s own books of account, to be put in evidence in his favor, the rule is that a foundation must be laid for their admission by proving that the party had no clerk; that some articles charged had been delivered; that the books produced are the account books of the party, and that he keeps fair and honest accounts, and this must be done by those who have dealt and settled with him upon the faith of his correct bookkeeping. Following Vosburgh v. Thayer, 12 Johns., 462.
    Appeal from a judgment entered upon the report of a referee. The action is upon an account, and the defense is a general denial and payment.

      William H. Townley, for app’lts; Theodore D. Dimon, for resp’ts.
   Macomber, J.

There is not in the case, with perhaps an exception applicable to one item only, any evidence which, would justify the recovery which was had before the referee, unless the plaintiffs’ books of account which were put in evidence were competent and sufficient to charge the defendants.

Throughout the case the defendants’ testimony tends to show that whatever work was done by the plaintiff, and whatever goods were furnished by him to the defendants were paid for shortly after their rendition. Upon the issue of payment tor the goods and services rendered we would not perhaps feel inclined to disturb the findings of the referee as they have been made under a conflict of evidence, and there is not that prep'onderance of testimony on the one side which would justify such a review of the facts.

But the principal cause of action for the plaintiff rests upon different considerations, for there being no admissions or concessions by the defendants, the only evidence of the existence of the indebtedness allowed by the referee is derived from the books of the plaintiff. To enable a party’s own books of account to be put in evidence in his favor the rule, as stated in Vosburgh v. Thayer (12 Johns., 462), and it still exists, is that a foundation must be laid for their admission by proving that the party had no clerk; that some of the articles charged had been delivered; that the books produced are the account books of the party, and that he keeps fair and honest accounts, and this must be done by those who have dealt arid'settled with him.

In Ives v. Waters (30 Hun, 298), it is stated that there exists no reason for relaxing the rule in any particular, because it was established by the courts when parties could' not be witnesses in their own behalf, and that it is a clear innovation upon the ancient common law which precludes parties from making evidence in their own favor. The testimony by which it is sought to show that the plaintiffs’ books of account were honestly kept, and that parties had settled with him upon the basis of the charges in such books is given wholly by the two witnesses, Eobert Swan and John Kyle. Swan, in his direct examination, which was apparently taken in the absence of the defendant’s counsel, said that he found the plaintiff’s books and accounts for the work to be correct, and paid him for the accounts which he rendered. The witness being subsequently called for a cross-examination, testified as follows: “I paid upon bills rendered to me by him; I never settled with him upon his books—only upon his bills; I never knew what books he kept; I never opened his books; I never looked into his books * * * I did not know what those books contained.” The witness, John Kyle, testified on his direct examination, also in the absence of the defendant’s counsel, as follows: “I never found any mistakes in the accounts or bills from his book that he rendered to me; I paid him according to the bills he presented to me, except sometimes he made a discount for cash payments.” He, in turn, being again summoned,, testified as follows:

“ Q. Did you testify, on December fourth, that you never found any mistake in the accounts or bills from his books that he, the plaintiff, rendered to you ?
" A Yes, I believe I did so testify.
“• Q Did you ever see any of Mr. Beatty’s books ?
"A. Never, except I may have seen what I supposed to be the day-book lying on his desk in his shop.
"Q. Did you ever know that book which you saw there was a day-book ?
“A. I did not.
“ Q. Did you ever examine that book or any book belonging to Mr. Beatty ?
“ A. I did not.
“ Q. Did you ever know Mr. Beatty kept any books ?
“ A. No, sir.
“ Q. Did you ever know that any account rendered to you was tasen from his books ?
“A. No, sir.
“ Q. In point of fact, you never settled any account of his on his boons ?
“ A. No, sir.
“ Q. Do you know then whether he kept his books correctly or not ?
“A. No, sir.”

This evidence is not sufficient to satisfy the rule that the fact must be shown that the party keeps fair and honest accounts, for such fact must be established, if at all, by those who have dealt and settled with him upon the faith of correct bookkeeping. Under this evidence, the introduction of the plaintiff’s books of account was not sufficient to charge the defendants, and there being no other evidence of the rendition of the services and the delivery of the property, except in a minor particular, it follows that the judgment should be reversed and a new trial ordered before another referee, with costs to the defendants to abide the result of the action.

Van Brunt, P. J., and Bartlett, J., concur


author: Lawrence, J. Bartlett, J

text:
    Young Men’s Christian Association of the City of New York, Res’pt, v. The Mayor, Aldermen and Commonalty of the City of New York, App’lts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Exemption—Taxes and assessments—When property tjsbd for religious AND SCHOOL PURPOSES—LAWS 1883, CHAP. 397—REVISED STATUTES, Part 1, chap. 13, title 1, § 4.
    On or about July 10, 1884, the respondent, a corporation for the improvement of the spiritual, mental and social condition of the young men of the city of New York, commenced the erection of a certain building on lots then and previously owned by said corporation, for the purpose and with the intent of putting the same to the uses and objects for which it was used after its completion In January, 1885, the property was assessed for taxation and in August, 1885.. a tax of ¡¡¡51,200 thereon, for said year, was confirmed. The building was completed in October of that year, and thereupon the plaintiffs commenced to use the same as a place for holding public worship and religious and social meetings and for imparting religious and secular instruction to young men. In said building were maintained by plaintiffs a library and lecture room, reading room, bath room and gymnasium, and instruction was given in penmanship, arithmetic etc , and lectures were given on scientific, medical and practical subjects and concerts and other entertainments were held therein. The aforesaid advantages and privileges were open to all young men of decent character upon becoming members of said association and upon the payment of a small membership fee. Attendance at the religious meetings, and on occasions of public worship was free to all. The plaintiff derived no income, rent or profit from said lots or building other than the membership fees aforesaid and all of these were applied to the current expenses of said institute. Held, that the said property was used both for religious and school purposes in such a sense as to entitle it to exemption from taxation under Laws 1883, chapter 897, which amends the Revised Statutes, part 1, chapter 13, title 1, § 4. That as the property had been acquired and the erection of the building begun before the assessment and before the confirmation of the tax, it was exempt from the tax levied for 1885. Bartlett, J. dissenting.
    The plaintiff is a corporation existing under an act to incorporate the Young Men’s Christian Association of the city of New York, passed April'3, 1866, and an act amending the same, passed May 6, 1872. The objects of the corporation are declared by the acts aforesaid to be, the improvement of the spiritual, mental and social condition of the young men of the city of New York, by the support and maintenance of lectures, sermons, libraries, reading rooms, social meetings and such other meetings and services as may conduce to the accomplishment of this object. Prior to 1885, the plaintiff was and still is the exclusive owner in fee of two lots in the city of New York, known by the street numbers 222 and 224 Bowery.
    On or about the 10th of July, 1884, the respondent commenced the erection of the building now covering both lots and known as the “Young Men’s Institute,” for the purpose and with the intent of putting the same to the uses and objects for which the same is now used. On the second Monday of January, 1885, the property was assessed for taxation for said year in the sum of $50,000, and on or about August 17, 1885, a tax of $1,200 thereon for said year was confirmed by the board of aldermen, and constitutes a lien valid on its face upon, the property aforesaid. The building in question was completed in October, 1885, after the confirmation of the tax, and thereupon the plaintiffs commenced to use the same as a place for holding_ public worship and religious and social meetings, and for imparting religious and secular instruction to young men. In said building are maintained by the respondent, a library and lecture-room or large hall, reading-room, bath-room and gymnasium, and instruction is given in penmanship, arithmetic, bookkeeping, mechanical, architectural and free hand drawing, and lectures are given on scientific, medical and practical subjects, and concerts and other entertainments are held therein.
    The court below found that the aforesaid advantages and privileges are open to all young men of decent character upon becoming members of said association, and upon the payment of a membership fee, ranging from fifty cents per year to four dollars per year, and that attendance at the religious meetings and occasions of public worship are free to all. Also that from the time of the commencement of the erection of said building the respondent has derived no income, rent or profit from the said lots or building, or any. part thereof, other than the membership fees aforesaid, and that since the completion of said building the said premises have been exclusively used for the purposes above mentioned, and all the said membership fees have been applied to the current expenses of the institute. The court also found, among other things, as conclusions of law, that the respondent constitutes a religious society, and that the tax is invalid and void on the proof of the facts, and that the same constitutes a cloud upon the title of said property, and judgment was directed that said taxis illegal and void, and that the same be canceled and the defendants restrained from enforcing the same.
    It is upon an appeal from this judgment that the case comes before us.

      E. Henry Lacombe, counsel to the corporation, and George S. Coleman, for app’lt; Hubbard Smith and Cephas Brainerd, for resp’ts.
   Lawrence, J.

It is provided by the Revised Statutes as amended by chapter 397 of the Laws of 1883, subdivision 3, that the following, among other property, shall be exempt from taxation.

“ Every building erected for the use of a college, incorporated academy or other seminary of learning, and in actual use for either of such purposes, every building for public worship, every school-house, court-house and jail use for either of such purposes, and the several lots wherein such buildings so used are situated and the furniture belonging to each of them.”

Subdivision 4. “Every poor-house, alms-house, house of industry, etc.”

Subdivision 5. “The real and personal property of every public library.” Chapter 282 of the Laws of 1852, provides: Section 1. “ The exemption from taxation of every building for public worship, and every school-house or other-seminary of learning under the provisions of subdivision 3 .of section 4, title 1, chapter 13, part first, of the Revised Statutes, or amendments thereof, shall not apply to any such building or premises in the city of New York, unless, the same shall be exclusively used for such purposes and exclusively the property of a religious society, or of the New York Public School Society.”

The question to be determined in this case is, whether the plaintiff is to be deemed a religious society, and an examination of the cases heretofore decided under the statutes, just ref erred to would seem to show that that question must be answered in the affirmative. In the case of the Hebrew Free School Association v. The Mayor of New York (4 Hun, 446), it appears that the plaintiff was incorporated under the act for the incorporation of benevolent, charitable, scientific and missionary societies, passed April 12, 1848, and the acts amendatory thereto. That the purpose of said corporation was to provide for the gratuitous instruction of Jewish youth in the Hebrew religion, and other branches of knowledge, and to promote the study of Hebrew literature. In that case, Presiding Justice Davis, in delivering the opinion of the court, said: “But we think: the words ‘a religious society,’ used in the act of 1852, were not intended to be used in the limited signification of church incorporations, or bodies organized for the mere purpose of establishing church societies, as provided by the act of 1813 and its amendments. It is true that the act of 1848 was not intended for the organization of religious societies in the sense of incorporated churches, but in the more general sense we see no reason why a body like the plaintiff may not be deemed a religious society, and as such the exclusive owner of property devoted to a school for religious and other instruction. See also Association for Colored Orphans v. The Mayor, etc. (38 Hun, 594; affirmed in court of appeals, see 6 N. Y. State Rep., 477.)

In the latter case it was held that it was not intended by chapter 282 of the Laws of 1852, or section 827 of chapter 410 of the Laws of 1882, providing that the exemption from taxation of buildings used for the purposes therein specified, should not apply to any building or premises in the city of New York, unless the same shall be exclusively used for such purposes, and exclusively the property of a religious society, to limit the exemption to such property as is owned by a religious society, but it was intended thereby to give the exemption to such building or premises as should be exclusively devoted to one or the other of the purposes, therein specified, whether the property was owned by a religious corporation or not. It is said, however, in this case that the property in question was not used exclusively for religious purposes—that the public worship and religious exercises of the institute only consist of a bible-class, bible talk and gospel meetings held every Sunday, while the institute is mainly devoted to physical, intellectual and social improvement for a consideration.

We think, however, that the uses to which the property is put may fairly be said, under the decisions above quoted, to be used both for religious and school purposes, in such a sense as to entitle them to exemption from taxation. It is further said that the property was notin actual use for the purposes for which it had been acquired until after the tax for 1885 had been confirmed. This is true, but the property had been acquired, and the erection of the building begun before the assessment and before the confirmation of the tax This brings the case within the decision of the general term of this department in St. James Church v. Mayor etc , of New York, 41 Hun, 309; 2 N. Y. Stato Rep., 383

We are, therefore, of the opinion that that the evidence supports the findings of fact and. conclusions of law of the special term, and that the judgment should be affirmed, with costs.

Van Brunt, P J , concurs.

Bartlett, J

(dissenting) I am unable to concur with the majority of the court in the conclusion that the respondent’s premises are used both for religious and school purposes in such a sense as to entitle them to exemption from taxation

The statute requires an exclusive use of the building in such a case as this, for religious purposes, or as a schoolhouse or other seminary of learning. Laws 1852, chapter 282. I do not think the Bowery branch of the Young Men’s Ohristain Association is either a school-house or seminary of learning in the statutory sense; nor does it seems to me that an exclusive use for religious purpose is made out by showing that there are religious exercises there every Sunday and prayer meetings on Thursday, when it also appears that the building is chiefly devoted to the physical, intellectual and social improvement, mainly .by secular means, of the young men who become members of the Association.


author: Daniels, J.

text:
    Arthur Dyett et al., Resp’ts, v. James M. Seymour et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Practice—Bill of particulars—When ordered.
    Tlie defendants in their answer stated that other shares of stock had oecn bought and sold by the defendants on the employment of one Eno. It was stated on behalf of the plaintiffs that neither they themselves nor Eno had any knowledge of the purchase or sale of such shares. Held, that statement did not impair their right to a bill of particulars as to said alleged purchase and sale.
    Appeal from an order directing service of a bill of particulars.

      Joseph E. Choate, for app’lt; B. F. Einstein, for resp’t.
   Daniels, J.

The order requires the service of a statement, or bill of particulars, of what has been alleged to be other shares of stock bought and sold by the defendants on the employ of John C. Eno. The statement that such shares of stock had been bought and sold has been made a part of the second subdivision of the defendant’s answer. And while it has been stated on behalf of the plaintiffs that neither they themselves nor Eno had any knowledge of the purchase or sale of such shares that did not exclude their right to a bill of particulars. For while the contrary was asserted by the defendants themselves as a part of their defense in the action, the plaintiffs were entitled to such further and additional information concerning it as would prevent them from being surprised by proof of the alleged facts, if that might possibly be made upon the trial. To avoid the risk of that surprise and supply them with the means of understanding and meeting the allegations so generally made, a bill of particulars was the proper remedy, and the court was right in requiring its service. For if the defendants had been engaged in those transactions, as they allege they had, there could be no difficulty standing in their way of adding to the information supplied by the answer, such further particulars as would bring the transactions to the knowledge or within the range of the investigation the plaintiffs might be able to make.

On the argument it was proposed by" the defendants’ counsel to strike out this allegation of the answer in preference to being subjected to the necessity of serving the bill of particulars. If that shall be done, then very obviously no necessity will remain for the service of the bill, and to meet this offer the order now to be made should affirm the order from which the appeal has been taken unless the defendants, within ten days after notice of the order to be entered on this decision, shall stipulate to strike the allegation of these facts out of their answer. If they do that, then the order should be reversed without costs of the appeal, but, if they fail to do that, it should be affirmed together with the usual costs and disbursements.

Brady, J., concurs.


author: Per Curiam.

text:
    Matter of The New York Elevated Railroad Company in re Story.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Damages—Reduction of amount—Restitution—Interest—2 R. S. (7th ed.), 1552, section 18.
    The statute requires the property owner upon the reduction of the amount of damages by a second appraisal to pay back only the difference between the amount finally awarded and that contained in the appraisal et aside. It does not direct the difference to be paid with interest. 2 Rev Stat. (7th ed.), 1552, §18. Interest on said difference can only be collected from the time of service of the order confirming the final report.
    Motion for restitution.

      W. B. Hornblower, for motion; J. E. Parsons, opposed.
   Per Curiam.

The statute requires the property owner upon the reduction of the amount of damages appraised by the second appraisal to pay only the difference between the amount finally awarded and that contained in the appraisal set aside. It does not direct the difference to be paid with interest, but simply that the difference shall be paid. 2 R. S. (7th ed.), 1552, § 18.

The obligation of the owner to pay this difference for the first time arose when the final report was confirmed by the court and the order of confirmation served upon him oi his attorney.

From that time he has been in default in the payment of this difference, and under the general principles of law applicable to the payment of legal obligations, should pay interest from that time, and it will be so ordered.


author: Brady, J.

text:
    Gonsalvo De Cordova, Resp’t, v. Nathaniel D. Powter et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    1 Partnership—What constitutes persons co-partners.
    Where one is only interested in the profits of a business as the amount of compensation for services rendered, he is not a partner. Manhattan Brass Manufacturing Co. v. Sears, 45 N. Y., 797, distinguished.
    2. Same—Test of partnership.
    The test of a partnership is the community of profits—a specific interest in the profits as profits in contra-distinction to a share of the profits as a compensation for services. Following Leggetts. Hyde, 58 N. Y., 272.
    Appeal from judgment directed at circuit and from an order denying new trial upon the minutes.

      Joseph A. Showdy, for app’lt; Jefferson Clark, for resp’t.
   Brady, J.

This action was brought against the defendant’s as co-partners. The process seems to have been served upon the defendant Powter only. The allegation upon which the plaintiff proceeded was that the defendant was a co-partner of Elizabeth Habich, who held a lease of a certain Guano island lying to the south of the Island of Jamaica, and known as the Pedro Cayo. The debt due to the plaintiff from the defendant it was stated was contracted in Kingston, Jamaica, in the transaction of his business, which was carried on under the name of the Pedro Cayo Phosphate Company.

The question presented is, whether under the agreement, to which reference will be made, between the defendant and Mrs. Habich, the former became the co-partner of the latter. The instrument is dated the 31st of October, 1881. By the first paragraph it is stated that Mr. Powter having acted as the manager and agent of the business of the Pedro Cayo Company on behalf of Mrs. Habich, she will, so long as he shall continue to devote his time and attention to the business, allow him, and after his decease, his representatives, as and for his renumeration and in full of all claims for services, including past services, an equal half part of the net profits to arise from the business during the subsistence of the lease held by her.

There can be no doubt that under this agreement Mr. Powter was made the manager of the business, and that he was to receive one-half of the net profits arising from the business as compensation.

There is, however, no evidence that he had any other interest in the business. It is not alleged and it was not attempted to be proved that he had held himself out as a .co-partner. Indeed no such question is presented by the record. The liability of the defendant rests wholly upon the construction to be given to the agreement, to which attention has been called, and upon that alone. The rule on that subject is distinctly stated in the case of Richardson v. Hughitt (76 N. Y., 55), and'it is as follows: Where one is only interested in the profits of the business as the amount of compensation for services rendered, he is not a partner. Per Miller, J., who after citing a number of adjudications, says: “These successfully sustain the doctrine laid down that where the profits are the measure of compensation no partnership is created. See also Eager v. Crawford (id., 97); Burnett v. Snider (id., 344); Curry v. Fowler (87 N. Y., 33); Cassidy v Hall (97 N. Y , 169)

The learned counsel for the respondent assumes that this is a case in which the defendant has an interest in the capital of the business and that, therefore, he is liable as a ■copartner. The suggestion is made in Richardson v. Hughitt, that under such circumstances a person who is to receive compensation in profits only may be a copartner even .as to to third persons. Butin this case the interest in capital does not exist. The capital is the lease which is owned by Mrs. Habick in which the defendant has no interest except that which springs out of his engagement by her as a manager of the business which the lease enabled her to carry on. It is very different, therefor, from the case of the Manhattan Brass Manufacturing Co. v. Sears (45 N. Y., 797), which is one of the cases relied upon by the respondent, for in that case it was said: “ Here are all the elements of a partnership as claimed by any writer:

“First. Sharing in the profits.
“Second. Sharing in the losses at least to the extent of •$4,000, the repayment of the whole of which depended on the profits.
Third. The right to inspect the books.
“ Fourth. A common interest in the stock of the company.”

The distinction which is drawn in this action is recognized in the case of Legget v. Hyde (58 N. Y., 272), in which it is said: “ The test of a partnership is the community of profit—a specific interest in the profits as profits, in -contradistinction to a share of the profits as a compensation for services. ”

We think that for these reasons the judgment appealed from was wrong and should be reversed and new trial ordered, with costs to abide the event.

Van Brunt, P. J., and Daniels. J., concur


author: Van Brunt, P. J.

text:
    John Sickles, Resp’t, v. William J. Morton, App’lt.

      (Supreme Court, General Term First Department,

      Filed March 31, 1887.)

    1 Practice—Appeal—There must be findings or exceptions.
    Where there have been in a case no requests to find or exceptions to findings of fact or conclusions of law, unless manifest injustice has been done, the general term of the supreme court will not reverse a judgment appealed from.
    8 Corporations—Power to issue shares—When shares void.
    A corporation cannot issue its shares unless for money or property. Shares issued entirely without consideration are void unless they become the property of a third party without notice.
    Appeal, from judgment at special term.

      Mr. Judge, Jr., for app’lt; Mr. Lydecker, for resp’t
   Van Brunt, P. J.

There having been no requests to •find or exceptions to findings of fact or conclusions of law, unless manifest injustice has been done, this court will not reverse the judgment appealed from.

The evidence showed that the shares which were the .subject matter of this action, were issued based upon an agreement which was never carried out, and which has been abandoned.

That for the shares received by William J. Morton and by Bowditch Morton nothing was ever paid, and there was no consideration therefor except such as the carrying out of the agreement might have given.

It is very probable that if the agreement had been carried out in its entirety, that even then the issue of the shares would have been illegal.

A corporation cannot issues its shares unless for money or property, and the corporation received neither in the case at bar.

These shares being issued entirely without consideration were void unless they became the property of a third party without notice. As far as the Mortons were concerned they could assert no right because of their ownership of these illegal shares.

The objection that the company should have brought the action, does not seem to have been taken at the trial and cannot now be raised.

The judgment appealed from must be affirmed, with costs.

Bartlett and Macomber, JJ., concur.


text:
    Sarah M. Mygatt et al., Resp’ts, v. George S. Coe, App’lt.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Mortgage — Foreclosure — What title vests under foreclosure deed.
    The effect of a foreclosure deed is to vest the purchaser with the entire interest and estate of the mortgagor and mortgagee as it existed at the date of the mortgage. In other words, the same estate passes which the mortgagor could have conveyed at the time of giving the mortgage. Fol lowing Christ Church v. Mack, 93 N. Y., 488.
    Appeal from a judgment in favor of the plaintiffs.
    In April, 1867, Almira S. Coe and the defendant George S. Coe, her husband, being in possession thereof, conveyed certain premises by deed with covenants of warranty to one Nancy Fisher, and delivered possession thereof to her.
    In December, 1869, Nancy Fisher being in possession of the said premises, mortgaged the same to the plaintiffs to secure the payment of $15,000. .
    Nancy Fisher subsequently conveyed said premises to one Fuller, and in 1874 said Fuller conveyed the same to one Leavitt.
    In 1878 an action of ejectment was brought by the heirs of one Howell against said Leavitt, who was then in possession, in which action judgment of possession was rendered for the plaintiffs upon the ground that the plaintiffs therein had a title paramount to that conveyed by the Coes to Nancy Fisher, and possession was given to said plaintiffs.
    In December, 1878, the present plaintiffs commenced an action to foreclose the mortgage given to them by Nancy Fisher, and such proceedings were had therein that judgment of foreclosure and sale was entered on the 5th of June, 1879, and on the 14th day of August, 1879, the said premises were sold, and the plaintiffs became purchasers thereof and received the sheriff’s deed therefor.
    Thereupon this action was commenced against the defendant, Almira S. Coe having died, to recover damages for breach of warranty contained in deed from the Coes to Nancy Fisher.
    Judgment having been entered for plaintiffs, from that judgment, this appeal is taken.

      Wm. S. Cogswell, for app’lt; Sidney S. Morris, for resp’ts.
   Van Brunt, P. J.

The whole argument of the appellant seems to be based upon an erroneous view of the effect of the mortgage and foreclosure and sale thereunder to the plaintiffs.

His argument demonstrates that the plaintiffs by virtue of their mortgage alone could claim no title in the land, and that a mortgagee holds simply a chose in action secured by a lien upon the land, and that the mortgagor is for all practical purposes invested with the title.

But the change effected by a foreclosure and sale under the mortgage seems to have been entirely overlooked.

In the case of Christ Church v. Mack (93 N. Y., 488), the court of appeals decided that the effect of a foreclosure deed is to vest the purchaser with the entire interest and estate of mortgagor and mortgagee as it existed at the date of the mortgage.

In other words, the same estate" passes which the mortgagor could have conveyed by. deed at the time of giving the mortgage.

The case cited turned upon this question, and the point was distinctly and squarely presented and decided.

If this is the law, then the plaintiffs by the sheriff’s deed acquired the same rights as though Nancy Fisher had conveyed the premises in question to the plaintiffs at the time of the giving of the mortgage, and it is not disputed that if she had done this, the plaintiffs could have maintained this action.

The claim that the only damages which the plaintiffs .could recover would be the amount paid for the sheriff’s deed, is not tenable.

They succeeded to Nancy Fisher’s rights, and it might well be claimed that they had a right to recover the whole consideration mentioned in the deed to her.

The judgment appealed from must be affirmed, with costs.

Bartlett and Lawrence, JJ., concur.


text:
    Adolphus H. Stoiber, App'lt, v. Robert C. Thudium, et al., Resp'ts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    Attachment—Warrant of—Summons—Code Civ. Pro., § 638.
    Tile affidavit upon which a warrant of attachment was granted stated “ that the plaintiff is about to commence an action against the defendant for the cause above stated by issuing the summons hereto annexed." Held, that this was a sufficient compliance with Code Civ. Pro., § 638, the summons being one of the papers upon which the application for the warrant was made.
    Appeal by junior attaching creditors from order denying motion to vacate warrant of attachment.

      D. C. Briggs, for app’lt; F. H. Smith, for resp’t.
   Brady, J.

The motion was made upon the ground that it appeared on the face of the affidavit on which the warrant was granted, that at the time the application was made for the warrant this action had not been commenced on the summons served or issued for service. In the affidavit presented to the judge who granted the attachment* it was stated “that the plaintiff is about to commence an action against the defendant for the cause above stated by issuing the summons hereto annexed, and no previous "application for an attachment has been made herein.”

It appears therefore that a summons was made out and accompanied the affidavit by being annexed to it. This is undoubtedly a sufficient compliance with section 638 of the Code, in the broadest view that can be taken in favor of the appellant’s motion.

The cases of Mills v. Corbet (8 How., 500) and Blossom v. Estes (84 N. Y., 614), cited on behalf of the appellant, so far as they affect this case, favor the propriety of the disposition made of the appellant’s motion.

It is not necessary to make any extended review, however, of any of the cases, or of the section of the Code under which the attachment was issued, for the reason that the question is substantially disposed of in this department in the case of Pickhardt v. Antony (27 Hun, 269), in which it was held upon consideration of the various sections of the Code affecting the question, that it need not appear upon the affidavits used upon the attachment that an action has been commenced or that a summons has been served, and that decision was founded upon the proposition that section 636 did not require a statement that an action had been commenced, but simply that one of the causes of action specified in section 635 existed, and that the plaintiff after obtaining the attachment had thirty days in which to serve the summons. Therefore the omission to refer to that process in the papers upon which the application for an attachment rested, was not any evidence that the summons had not issued.

Here the statement was positive that the summons was issued when the application was made for an attachment, because it formed a part of the papers upon which the application was made.

There can be no doubt that the order from which the appeal was taken was right, and it should be affirmed, with ten dollars costs and disbursements.

Daniels, J., concurs.


text:
    In the Matter of David W. Williams, deceased, etc.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    1. Administration—Letters of—Mother of one deceased intestate, HAS A RIGHT PRIOR TO THAT OF A BROTHER OF DECEASED.
    The mother of one deceased, intestate, is entitled to letters of administration in preference to a brother.
    2. Same—Non-residence of the mother does not alter the case.
    This fact is not altered by the non-residence of the mother within the state.
    3. Same—Rule applies also to ancillary letters.
    The rule applies to ancillary letters of administration as well.
    Appeal from decree of the surrogate granting letters of administration upon the goods, chattels and credits in the county of New York of David W. Williams, deceased, to Lucy E. Williams.

      Thomas Jackson, for Fielding L. Williams, app’lt; John Notman, for Lucy E. Williams, resp’t.

       Affirming 5 N. Y. State Rep., 361.

   Van Brunt, P. J.

The decedent died in June last at Clarksville in the state of Tennessee leaving him surviving no widow, child or father, but leaving him surviving a mother and a half brother. One Polk D. Johnson, of Tennessee, was in July last appointed administrator in the state. There are assets of the deceased in this county, and applications for authority to administer upon those assets have been made on behalf of three three persons; the decedent’s mother Lucy E. Williams, the respondent herein, his half-brother Fielding L. Williams, the appellant, and the said Polk D. Johnson.

The learned surrogate granted letters of administration to the mother, Lucy E. Williams, to the exclusion of the half-brother. See 5 N. Y. State Rep., 361. The mother was not a resident of the state of New York, but the half-brother was such resident.

It is claimed on the part of the appellant that Lucy E. Williams, being a non-resident, was disqualified and that therefore the surrogate erred in issuing letters of administration to her in preference to his half-brother who was a resident of this state, The provisions of the Revised Statute (2 R. S., 74), as amended by the laws of 1867, chapter 782, section 6, provide as follows:

Section 27. Administration in case of intestacy shall “be granted to the relatives of the deceased who would be entitled to succeed to his personal estate, if they, or any of them, will'accept the same in the following order:

“First, to his widow; second, to his children; third, to the father; fourth, to the mother; fifth, to the brothers; sixth, to the sisters; seventh, to the grandchildren; eighth, to any other next of kin who would be entitled to share in the distribution of the estate.”

Under this provision it is clear that the mother would be entitled to letters of administration in preference to the brother who claims them.

It is, however, urged on the part of the brother that the mother being a non-resident is excluded from receiving such letters. It is not claimed that there is any express provision of the statute which calls for such an exclusion, but that it is the policy of the law as derived from the legislation upon the subject of administration to exclude a person who is a non-resident where there are residents capable of administering the estate. In support of this proposition our attention is called to section 2662 of the Code, which contains provisions as to when a citation is required, and who shall be cited upon the application for letters of administration.

This section provides that every resident shall be cited, and the surrogate may, in his discretion, issue a citation to non-residents. It is argued, therefore, that as this section in terms dispenses with the necessity of a citation to nonresidents, an application here to obtain letters of administration may be made without any notice to non-residents, no matter what degree of kinship they may sustain to the deceased. In answer to the argument thus advanced, that this section supports the claim of the appellant, it is sufficient to say that the section does not provide that whenever a resident makes such application such notice may be .given, but mat the provisions of the_ section apply to every application for letters of administration and leave it discretionary with the surrogate whether persons out of the jurisdiction of the court shall receive notice of the application or not, a very common class of legislation in reference to special proceedings of this character which determine no property rights. Section 30 of the Revised Statutes is very significant upon this point, in the classes named as persons who are not qualified to receive letters of administration. It is as follows:

“No letters of administration shall be granted to a person convicted of an infamous crime, nor to one incapable by law of making a contract, nor to a person not a citizen of the United States, unless such person reside within this state,” etc.

The language, “nor to a person not a citizen of the United States, unless such person reside within the state,” seems to be very significant in this connection, because it contains a clear implication that a person who is a citizen of the United States, although not residing within this state, is not intended to come within the prohibition of the law.

In this provision of the statute, the framers thereof had before them the question as to the residence of the applicant for administration, and if they had intended to exclude, or had supposed that the policy of the law excluded non-residents from administering, they certainly, in connection with the provisions in regard to citizenship, the absence of which they pronounced to be a disqualification unless the person applying resided within this state, would have included non-residence of a citizen among the disqualifications. • It is no answer to these suggestions to say that the provisions in reference to non-residents who are not citizens were intended to apply only to those who were seeking to obtain ancillary letters of administration, because, if that had been the intention of the legislature, it would have been very easy for them to have said so. No •reference is made to ancillary letters, and the statute is entirely general in its character. The statute having ex-pressly provided as to the priority of the persons to whom letters of administration shall be granted, and having determined as to disqualifications, nothing can be added to it by judicial legislation, and the withholding of letters of administration cannot be justified unless the applicant is disqualified by the statute itself. Coope v. Lowerre, 1 Barb. Ch., 45; Emerson v. Bowers, 14 N. Y., 449.

Restrictions or modifications of statutes by implication are not to be favored, and unless the provisions are clearly inconsistent and cannot stand together, full effect must be given to all. No provision of the statute is impaired'in any manner by giving to section 30 its full effect and restricting-it to its declared provisions.

Simply placing non-residents upon a different position from residents as to notice of applications for administration upon assets existing within this state conveys to our mind no intimation or intention upon the part of the legislature to exclude any other, than those whom they have expressly declared shall not be entitled to administration.

The decree of the surrogate, therefore, seems to have: been correct, and should be affirmed, with costs.

Daniels and Brady, JJ., concur.


author: Lawrence, J.

text:
    Ida M. Kursheedt, App’lt, v. James McCune et al., Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    1. Mortgage—Assignee op—Takes subject to the equities existing. BETWEEN THE ORIGINAL PARTIES THERETO.
    These defendants affixed their mark to a bond and mortgage of real property made in favor of their attorney upon false and fraudulent representations, that the said papers constituted a transfer of the real property of' one defendant to the other. Previous to this occurrence the plaintiff had. placed money in the hands of said attorney for investment, and subsequently he assigned to her the mortgage in question. Held, that theassignee of a mortgage, although a bona fide holder, takes it subject to all defenses existing between the original parties.
    2. Same—Who is not bona pide purchaser op.

      Held, that the plaintiff having parted with no new consideration on the: strength of the bond and mortgage, was not a bona fide purchaser thereof,
    3. Fraud—Occurring through negligence op a party—Consequences-
    must be borne by.

      Held, that the plaintiff could not avail herself of the equitable principle that when one of two innocent parties must suffer, he must bear the loss, whose act or negligence permitted it to occur; that the fraud upon her occurred through her own negligence.
    4. Evidence—Relevancy op.

      Held, that a question as to whether the plaintiff relied upon this bond and mortgage as security for her money was properly disallowed, she having parted with no consideration therefor.
    5. Same—Materiality and relevancy.

      Held, -that evidence by the defendants as to their ignorance of the nature of the papers which they signed and as to what was said by the attorney about the transfer of property, was material and relevant on the issue of fraud.
    This is an appeal from a judgment of the special term of this court dismissing plaintiff’s complaint.

      Phillips & Avery, for app’lt; Peter Mitchell, for resp’ts.
   Lawrence, J.

It was found by the learned justice, be fore whom this cause was tried, that the defendants signed and affixed their mark to the bond aud mortgage in question upon the false and fraudulent representations of Thomas Brennan, who was their attorney; that said papers constituted a deed or transfer of the real property of the defendant, James McCune, to his wife, the other defendant.

The justice further found that the defendants signed said papers, relying solely on said Brennan’s representations, and believing such papers to be the deeds or transfers necéssary to convey the property from James McCune to his wife. Also, that at that time the defendants were not indebted in any sum whatever to said Brennan, and received, no consideration from him at the time of their signature to the papers aforesaid.

It further appears from the findings that on or about the 7th of June, 1880, Brennan assigned to the plaintiff said bond and mortgage and the money due and to grow due and accrue thereon; that at the time of the alleged assignment by Brennan to the plaintiff the latter then gave or paid no consideration therefor.

It further appears from the findings that in the month of April previously the plaintiff had given said Brennan about $2,500 to invest for her, as her" agent, on bond and mortgage, but that said moneys were not paid to the defendants or invested by Brennan in the alleged bond and mortgage in suit.

Upon these findings of fact the learned justice found as conclusions of law that the bond and mortgage sued upon were obtained from the defendants by false and fraudulent representations and pretenses; that they were invalid and void, and that Brennan could convey no legal title thereto to the plaintiff; that the plaintiff is not a bona fide holder of said bond and mortgage, for a valuable consideration, and that said plaintiff could only hold said bond and mortgage subject to. the equities existing between the defendants and her assignor, and that the bond and mortgage are void and should be delivered up for cancellation.

One examination of the evidence in this case satisfies us that the findings of fact made it special term are correct.

It is quite apparent, we think, that Brennan took advantage of the relation in which he stood towards the defendants of their ignorance in business matters, and of the extreme confidence which they reposed in him as their friend and legal adviser to perpetrate the fraud which has given rise to this litigation. We think it clear that the defendants supposed that the.bond and .mortgage in suit constituted a transfer' of the real property of the defendant James McCune to his wife, the other defendant, and that they had not the slightest suspicion that they had executed any bond or mortgage to him, to whom at that time, as appears by the evidence, they were not indebted in any sum whatever. The plaintiff herself admits that although the bond and mortgage were advanced on the 7th of June, 1880, the interest up to January, 1885, was paid to her by Brennan in person.

Such being the facts, we are of the opinion that the judgment rendered at special term was right. The principle is elementary that an assignee of a mortgage, although a bona fide holder, takes the same subject to all defenses existing between the original parties. Ingraham v. Disborough, 47 N. Y., 421, and cases cited.

It cannot be contended for one instant, under the facts proven in this case, that Brennan could have enforced the bond and mortgage, which, by his fraud, he obtained from his clients. We might rest the decision of the case upon this point alone, but it may be as well to observe that the plaintiff on the facts proven cannot be conceded to be a bona fide holder or owner of the mortgage in suit, as against the defendants. She had given her money to Brennan for investment, as early as April, 1880, and "the mortgage was not executed until the fifth of June, 1880, nor was it assigned to the plaintiff until the seventh of June, 1880. The plaintiff therefore parted with no new consideration at the time she received the assignment of the mortgage. Her rights, as to Brennan, were then fixed, and she stood towards him as his bailor or creditor after April, 1880. She parted with nothing on the strength of the bond and mortgage in suit, and under all the decisions she cannot be regarded as a bona fide purchaser of the bond and mortgage, even if, as already stated, she did not take them subject to all the equities existing between Brennan and the defendants. Nor can the plaintiff avail herself of the rule invoked byiher counsel upon the argument that when one of two innocent parties must suffer, he must bear the loss whose act or negligence occasioned or permitted it to occur. It was her own negligence in intrusting her money to Brennan, which enabled him to commit the fraud as to her; he became her agent for the purpose of such investment, and the fact that Brennan succeeded in committing another fraud upon the defendants, does not entitle the plaintiff to shift her loss upon them, or to hold them liable therefor.

An exception was taken by the appellant’s counsel to the disallowance of this question to the plaintiff:

“Did you rely upon that bond and mortgage as a security for your money ?” The court in sustaining the objection taken by the defendants counsel, remarked that “she did not part with anything at that time.”

We think that the ruling was correct, because it distinctly appeared, as has been before stated, that the plaintiff had entrusted her money to Brennan for investment in April, 1880, and the question called for an answer as to a transaction which took place in June. ' Brennan had been in the possession of the plaintiff’s money between April and June, and under the authorities above cited, the plaintiff could not, although a bona fide holder, avoid the defenses existing between the original parties to the mortgage.

The objection taken to the admission of the evidence by the defendants, as to their ignorance in signing the bond and mortgage, and also as to what was said by Brennan about the making of the transfer of the property to his wife, were also properly overruled. The defendants were certainly entitled to show the fraud, which had been perpetrated by Brennan upon them, and those questions were competent for that purpose.

For these reasons, we are of the opinion that the judgment below should be affirmed, with costs.

Van Brunt, Ch. J., and Bartlett, J., concur.


text:
    Washington Seligman et al., Res’pts, v. Joseph I. Falk et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed March 31, 1887.)

    1. Attachment-Certificate by person having in possession defendants’ property—Examination of such party—Code Civil Pro., §§ 650, 651.
    Where a certificate given in accordance with the provisions of Code Civil Procedure, § 650, is not a bona fide compliance with the demand made, the attaching creditor, is not bound to take the statement of the de - fendants’ debtor, but is entitled to an examination under Code Civil Procedure, § 651.
    2. Same—Nature of certificate—Code Civil Pro., 650.
    The Code contemplates in the certificate provided for by section 650, a general statement specifying the amount, nature or description of the property held bv the parties furnishing it or the defendants’ interest in the property so held, or the debts or demands owing to the defendants as the case may require.
    Appeal from order denying motion to vacate order for examination of appellants under section 650 of the Code.

      Anthony R. Dyett, for app’lts; Eugene Seligman, for resp’ts.
   Brady, J.

An attachment was obtained against the defendant who was a member of the firm of I. L. Falk & Co., which was dissolved on the third of February of the present year. A certified copy of the attachment was served on the appellants, who were members of the firm as it existed prior to the dissolution and before the defendant had absconded, with the usual notice and demand of a certificate under section 650 of the Code. None having been furuished on the twelfth of February, an order was made directing the examination of. the other members of the firm as' to the property of the defendant held by them, either as members of the firm or as individuals. On the return day of the order for examination the appellants, moved to vacate the order, but the motion was denied.

It is alleged by Mr. Seligman, one of the plaintiffs” attorneys, that the plaintiffs have no satisfactory information of the interest of the defendant in the firm or of the-defendant’s property held by the other members beyond this, namely, that he was informed on the fifth of February by the firm that the defendant’s share of its profits for the-year terminating November last was $11,000. Mr. IsaacFalk claims to have given a certificate, not having refused, to give one,, and that neither of the other members of the firm refused to give one. But it appears that a new firm was created after the dissolution under the same designation, publication, of which was duly announced in the newspapers.

The exception taken to the certificate given is that it is-disingenuous for the reason that it is given by the existing firm, and such appears to be the fact. In this certificate, they state that they do not owe the defendant anything, and that they have no property whatever in their possession belonging to him; that he is not a member of their firm, but is indebted them in several thousand dollars. The plaintiffs are not seeking any information of that kind. Their object was to know whether the remaining members of the defendant’s firm had any property or money in their possession, and what interest he had in the firm of which he and they were members. There can be no question that the certificate furnished by them was not responsive, and the criticism that it was disingenuous seems, therefore, to be quite justified. The attempt is made on the part of Mr. Falk to disclose the defendant’s interest in the firm of which he was a member in the affidavit made by him, but it seems to be incomplete, even if it be regarded as a certificate under the provisions of the section mentioned, for the reason that there is no statement as to the capital of the defendant, which, as very justly suggested by the respondents’ counsel, would be a very important item in determining what his share of the assets was. They do not state either how long the firm existed or in what manner it was dissolved. They make extracts, it is true, and state a conclusion of law. The consequence is, that taking all disclosures made by all the papers submitted on behalf of the appellants, they present a very unsatisfactory statement of the interest of the defendant in the firm of which he was a, member. The plaintiffs are not obliged to accept such a certificate. Unless the Court can see that there is at least a fair, bona fide compliance with the demand made, the plaintiffs have a right to the examination. The attaching creditor is not bound to take the statement of the defendant’s debtor, but is entitled to the examination under such circumstances. Baxter v. M. K. and T. R. R. Co., 4 Hun, 630; Glen Cove Manufacturing Co. v. Gotthold, 1 Civ. Pro., 366^

^ The Code, by section 651, expressly declares that if it appear to the satisfaction of the court or a judge thereof that the certificate is untrue, or fails fully to set forth the facts required to be shown, an order to attend and submit to an examination may be made. The right of the sheriff to levy on the defendant’s interest in the property of the old firm cannot be doubted. Atkins v. Saxton, 77 N. Y., 195, 199. And whatever is the subject of levy must be the subject of inquiry in proceedings under an attachment.

The learned counsel for the appellant insists that it is a prerequisite to granting the order for examination that there should be some evidence that the person proceeded against is a debtor of the defendant or a person holding property belonging to him, and that there is no such evidence in the papers.

Assuming this to be, the suggestion is not sustained by the evidence because, as we have already seen, it is alleged by Mr. Seligman that he was informed that the defendant’s share of the profits for the year terminating in November, 1886, was $17,000.

It is also further contended that to compel a certificate in detail of the partnership interests would substantially amount to an accounting. But this view is also erroneous for the reason that the Code contemplates a general statement, namely, a paper specifying the amount, nature or description of the property held for the benefit of the firm, or the defendant’s interest in the property so held, or the debts or demands owing to the defendant, as the case requires. If the remaining members of the firm, of which the defendant was one, had certified generally for example that the defendant had an interest in the firm the exact extent of which could not be ascertained until an accounting could be had, or that he had no interest in the firm, or that they had no property of his, a different question would be presented. Under such circumstances, it may that the courts would require a more formal proceeding to ascertain the precise nature of the interest. But what would be done under such circumstances, it is not necessary now to consider, inasmuch as the certificate given was not the one called for; and, further, the statements were not as full and explicit as they should have been, if made at all.

For these reasons the order should be affirmed, with ten dollars costs and disbursements.

Van Brunt, C. J., and Daniels, J., concur.