author: Smith, J. r

text:
    In the Matter of JAMES C. STRONG, Appellant, v. EDWARD B. SMITH, Respondent.

      Disputed elections — applications under 1 R. 8., 603, § 5 — eowrt will go behind transfer books.

    Where an application is made under 1 Revised Statutes, 603, section 5, to settle contests arising out of a disputed election, the court may go behind the entries in the transfer hook of the company, and determine whether a transfer appearing thereon was a sale or only a pledge of the shares, and whether the pledgor or pledgee was entitled to vote thereon.
    Appeal from an order of the Special Term in Erie, denying a motion made by the appellant under 1 Revised Statutes, 603, section 5, for an order declaring the appellant to have been duly elected the president and one of the directors of the “Buffalo Mey Grain Drying Company,” at an election held on the 5th of June, 1877, and that the respondent, Edward B. Smith, has no title to either of said offices, or for such other relief as the court shall deem just.

      John O. Strong, for tne appellant.

      Spencer Clinton, for the respondent.
   Smith, J. r

The statute under which the motion herein was made is part of a title of the Revised Statute headed, “ Special provisions relating to certain corporations.” Section five of the title makes it the duty of this court, upon the application of any person aggrieved by or complaining of “ any election or any proceeding, act or matter in or touching the same,” to proceed forthwith, and in a summary way to hear the affidavits, proofs and allegations of the parties, or otherwise inquire into the matter or causes of complaint, and thereupon to establish the election so complained of, or to order a new election, or make such order and give such relief in the premises, as right and justice may appear to the court to require. And it is provided that the court may, if the case shall appear to require it, either order issues to be made up in such maimer and form as the court may direct, in order to try the respective rights of the parties, who may claim the same, to the office or franchise in question, or may give leave to exhibit, or direct the Attorney-General to exhibit an information in the nature of a quo warranto in the premises. (1 R. S., 603, § 5.)

The contest in this case involves the question whether the appellant had the right to vote, "at the election above referred to, upon certain shares of the capital stock of the 11 Mey Grain Drying Company,” to the number of four hundred, and that question depends upon whether a certain transfer of said shares, which the appellant had theretofore made to the firm of Smith, Davis and Clark, was a -sale, or merely a pledge of such shares. It is undisputed that, if the appellant had been permitted to vote upon those shares, the respondent would not have been elected to the office in question. We understand from the opinion delivered by the judge, who held the Special Term, that he denied the motion upon the ground that as the transfer book did not show that the shares in question stood in the name of the appellant at the time when he offered to vote on them, the fact was not only conclusive upon the inspectors of election, but it precludes all inquiry in this proceeding as to whether the transfer made by the appellant was an absolute sale or a mere pledge. We concur with him in holding that the transfer book was conclusive upon the inspectors; but we are of the opinion that the court at Speoial Term had the power, and it was its duty, to go back of the entries in the transfer book, and inquire whether the appellant had the lawful right to vote upon the shares in dispute, and if he had, then to order a new election, or to give other appropriate relief. This conclusion we think accords with the statute.

The object of the statute is to provide a summary mode of redressing a wrong, done at an election of the officers of a corporation. The statute provides that the inspectors shall be bound by the transfer book; but as errors may creep into the transfer book it was deemed expedient to provide a mode of correcting the results of such errors. To that end, the court is vested with ample power to inquire into the cause of complaint, on motioji, and to give relief by ordering a new election or otherwise, as right and justice shall require. And for that purpose the court is authorized1 to order issues to be made, in the very proceedings by motion to try the title to the office in dispute, or to direct a suit by information in the nature of a quo warranto for the like purpose. These provisions are obviously inconsistent with the idea that the court is concluded by the entries in the transfer book, and they clearly indicate that the court is vested with power to go back of the transfer book, and to try the rights of the respective claimants to the office in dispute.

These views seem to be supported by adjudged cases. The statute referred to was first adopted in 1825. (Laws of 1825, eh. 325, § 9.) In Ex parte Holmes (5 Cow., 426), it appeared that, at an election of officers of a corporation known as the Tradesmen Insurance Company of the City of New York, certain shares of the stock of the company stood on the transfer book in the names of “ Zebedco Ring, Aaron II. Merchant and William P. Hallett, trustees.” Ring, on.e of the trustees, was allowed to vote on those shares, notwithstanding the objection of Hallett, another trustee, and by such vote certain directors were elected. On motion, under the statute, it appeared by affidavit that Ring and his co-trustees held the shares in trust for the company, and that the directors of the company had duly resolved that those shares should be voted upon by Ring, the chairman of the trust committee. The court held that as the stock was held in trust for the corporation it could not be voted on at all, and upon that ground they set aside the election .and,, ordered a new one. In the subsequent case of Ex parte Willocks (7 Cow., 402), the court commented on the Case of Holmes, and said : The shares stood in the names of persons who were trustees for the corporation. They were designated as trustees. Literally they might have voted, but we allowed it to be shown that they were trustees. To give tbe transfer books such a binding effect as to shut out all inquiry in every case, might ■ enable the directors to control the election through the funds of the institution; (page 412.) That the court were of the opinion that the trustees in Ex parte Holmes had an apparent right to vote, according to the entry in the transfer book, is further shown by the case of Barker. (6 Wend. 509.) But by proof aliunde, that they were trustees for the corporation, their apparent right was overthrown. In the Matter of the Long Island Railroad Company (19 Wend., 37), an election of directors was set aside under the statute, it appearing by affidavits that at the time of his election one Lord, who offered to vote on certain shares and was refused, and whose vote, if it had been received, would have changed the result, was the'owner of such shares, by assignment from the individual in whose names they stood upon the books, and that he had applied at the proper place to have the .transfer entered upon the books, which was refused, for the reason that the stock had already been declared forfeited for default in payment of calls. The court being of opinion that the directors had no power to declare the stock forfeited, and that the proceeding in that regard was void, held that Lord’s votes were improperly rejected, and they set aside the election and ordered another. The case of Holmes and that of the Long Island Railroad Co., are direct authority for the position that in a proceeding under the statute the court may go behind the entries in the transfer book, for the purpose of determining the light to vote. In each of them, the facts were undisputed, and consequently it was not necessary to direct an issue to be framed or an action to-be brought; but, if such a course had been needed, it is obvious that the court would not have declined to order it, on the ground of a want of power. We are of opinion that the Special Term erred in holding that it had not power to determine the question whether the transfer of the shares was a sale or a pledge, and whether the appellant had'the right to-vote upon them, notwithstanding they stood upon the transfer book in the name of the respondent. If the shares were pledged merely, the right to vote upon them seems to be secured to the pledgor by the act of 1848 (Laws of 1848, ch. 40, § 17), under which the company was incorporated. The right of voting on shares, in every corporation, is ■ made subject, by the statute under which this proceeding was instituted, to the provisions of the act of incorporation. (1 R. S., 604, § 6.)

If the Special Term, upon a consideration of the subject, had concluded that the appellant had the right to vote upon the shares in dispute, it could have granted relief by setting aside the election and ordering a new one, under the clause in the notice of motion, asking for general relief. It could not have declared the appellant elected, because he had not received a majority of the votes. "We are asked by the appellant on this appeal to determine whether he had the right to vote on the shares in question, and if we conclude that he had to give him the relief which the Special Term might have given. But the question whether the shares wore sold or pledged, and which of the parties had the right to vote on them, ought first to be passed on at Special Term. As lhore than a year has elapsed since the election, and the term of-the office in dispute has expired, there is no objection, on the scoi’e of delay, to going again to the Special Term; and, by that course, each party will be at liberty to produce additional papers and proofs, if so advised. The result is that the order of the Special Term, denying the motion, is reversed, with leave to the appellant to renew his motion at Special Term, the appellant to have costs and disbursements of the appeal, and costs of the motion at Special Term.

Present — Smith and Noxoh, JJ., Talcott, P. J., not sitting.

Order appealed from reversed, with leave to appellant to renew his motion at Special Term, the appellant to have $10 costs and disbursements of the appeal, and $10 costs of the motion at Special Term.


source: Caselaw Access Project

author: Talcott, P. J.:

license: Public Domain

text:
    ELIZABETH H. PEASLEY, Plaintiff, v. THE SAFETY DEPOSIT LIFE INSURANCE COMPANY, Defendant.

      Application for insurance — construction of question as to disease.

    An application for. insurance contained the following question: “Have the person’s parents, uncles, aunts, brothers or sisters been afflicted with consumption, scrofula, insanity, epilepsy, diseases of the heart, or otherr hereditary disease ?”

      Held, that the last three words limited the generality of the previous portion of the question, and confined the inquiry to those cases in which the specified diseases were of an hereditary character.
    Accordingly, where the question was answered in the negative, and upon the trial it appeared that the person’s mother had had three attacks of insanity, not of an hereditary character, and which were due to accidental causes, held, that no breach of warranty was shown.
    MotioN for a new trial, on exceptions ordered to be beard in tbe first instance at the General Term, after a judgment dismissing the complaint ordered at the Cayuga Circuit.

      F. D. Wright and F. W. OogsioeTl, for the plaintiff.

      John T. Pingree, for the defendant.
   Talcott, P. J.:

This is a motion for a new trial by the plaintiff, whose complaint was ordered to bo dismissed and judgment ordered for the, defendant at the Cayuga Circuit, and the exceptions ordered to be heard in the first instance at the General Term.

The action is upon a policy of life insurance upon the life of John J. Peasley in the sum of $3,000, for the sole use and benefit of the plaintiff, the wife of the said John J. Peasley. The insurance company defends the action upon the ground that John J. Peasley made an untrue answer to question No. 14, in his application for said policy. The said question No. 14 was as follows : “ Have the person’s parents, uncles, aunts, brothers or sisters been affiicted with consumption, scrofula, insanity, epilepsy, diseases of the heart or other hereditary disease ? ” To this question the said Peasley had given the answer “No.” This was held by the justice at the Circuit to be a warranty that none of the relatives specified had ever had any of the diseases therein mentioned; and it appearing that the mother of the deceased had been temporarily insane on three different occasions, the said justice held that the plaintiff could not recover. The plaintiff duly excepted to the said ruling, and requested the court to hold and decide that if the said answer to said question No. 14 was held to be a warranty, it was a -warranty only that the said persons therein mentioned had never been afflicted with any of the diseases, therein mentioned, hereditary in their character or with any other hereditary disease, but the court refused so to hold, and the plaintiff's counsel excepted. The counsel for the plaintiff also requested the court to hold that the said answer was not a warranty under the application and policy, and was a representation merely. The court refused so to hold, and the plaintiff’s counsel excepted.

The counsel for the plaintiff' also requested the court to submit • to the jury the question, whether the insanity of the mother of said Peasely under the proof was hereditary, claiming that unless the jury believed it to be hereditary, the warranty (if the answer was hold to bo a warranty) was not broken. The court refused to submit that or any other question to the jury, holding that, under the proof, the warranty made by the answer to question No. 14 was broken by the fact that the mother aforesaid had been insane, without reference to the question whether such insanity was hereditary, to which ruling the plaintiff’s counsel excepted.

It is to be borne in mind that 11 no rule in the interpretation of a policy is more fully established or more imperative than that which declares that in all cases it must be liberally construed in favor of the insured, so as not to defeat, without a plain necessity, her claim to the indemnity which; in making the insurance, it was the object to secure. When the words are without violence, susceptible of two interpretations, that which sustains her claim must, in preference, bo adopted.” (May on Insurance, p. 182, § 175.) “ And so if a question is susceptible of being answered in more than one way, and differently from different points of view, it will not be open to the company which proposes the question to object that it is not answered in the true sense.” (May on Insurance, § 175.) And, “in construing an instrument prepared by the insurers, it ought to be read most strongly against the maker.” (May on Insurance, § 176.)

These rules for the construction of policies of insurance are elementary ; and treating the answer to the question No. 14 as an absolute warranty, we think the learned justice at the Circuit fell into an error in the construction of such warranty. The only fact which would have a tendency to affect the risk, was whether the insanity with which the mother of Peasely was afflicted was hereditary in its character. Insanity, brought about by temporary and accidental causes- — -such, as in this case, a fever, or displacement of the womb — could have no bearing on- the risk, and the party interrogated, in view of the only legitimate purpose for which such a question could be asked, was justified in supposing, from .the form of the question, and from the nature of the diseases embraced in it, that the object of the company was to inquire whether any of the relatives named in the question had been afflicted with any of the diseases specified, which were hereditary in their character, rendering it probable that the person whose life the company proposed to insure would be more than ordinarily liable to be attacked by the same disease. The concluding words of the question, “or other hereditary disease,'” qualified the generality of the preceding words, and directed the attention of the applicant to the hereditary character of the diseases specified, and were intended, or, at least, calculated to inform him that the diseases inquired about were such and such only, as were of an hereditary character, and would not be likely to call his attention to a case of temporary mental alienation from some accidental cause.

The evidence in the case was very strong to show that the disease with which the applicant’s mother had been, on three several occasions, afflicted, was, in the opinion of her physicians and others; due to accidental causes solely, and did not show any hereditary taint in the constitution of the mother which would be likely to be transmitted to her offspring. We think, therefore, assuming the answer to the question to have been an absolute warranty, that the ruling at the Circuit was wrong, and that the plaintiff’s counsel was right in asking that it be submitted to the jury upon the evidence, to determine the question of fact whether the insanity with which the mother of the applicant was afflicted was of an hereditary character, not due solely to accidental and temporaiy causes. On this ground, we must direct a new trial.

Order dismissing the complaint and directing judgment for the defendant reversed, and new trial ordered, costs to abide the event.

Present — Talcott, P. J., Smith and HardiN, JJ.

New trial granted, costs to abide event.


text:
    MARK A. NICHOLLS, as Executor, etc., of MARTIN I. BORST, Deceased, Appellant, v. THOMAS N. VAN VALKENBURGH and THOMAS T. FLAGLER, as Executors, etc., of DANIEL A. VAN VALKENBURGH, Deceased, Respondents.

      Evidence of fmanaal situation of parties — when admissible.

    This action -was brought upon a note made by Van Valkenburgh, defendant’s testator, and payable to the order of one Borst, plaintiff’s testator. The note was incomplete in form — the amounts not being fully filled in. The defense was that the note was given as a memorándola or voucher for a gold draft, drawn by Borst, as president of the Exchange Bank of lockport upon the Metropolitan Bank of New York, to the order of the Bank of Montreal, to settle
    1 a transaction in which Borst and Van Valkenburgh were interested, it being the intention that when the cost of the gold draft was known, such amount should be filled in in the note, and that the note should be discounted to pay the amount of such draft. It was claimed that afterwards such, gold draft was paid for in a different manner, and the incomplete note forgotten until after Van Valkenburgh’s death, when it was presented by Borst.
    Upon the trial evidence was given of the financial situation of Borst ahd Van Valkenburgh at the time the note was made, and at its maturity, to sustain defendant’s version of the transaction, and to show the improbability of its remaining over-due without a demand for its payment. Held, that the evidence was admissible.

      Nicholson v. Waful (70 N. Y., 604) distinguished.
    Van Valkenburgh’s son having testified that he was intimately connected in business with his father, and kept his books, was allowed to testify that neither the note nor its proceeds entered into such business. Held, no error.

      Appeal from a judgment in favor of the defendant, entered upon the verdict of a jury at the Niagara Circuit, and from an order denying amotion for a new trial,, made upon the minutes of the justice before whom the action was tried.

      G. W Bowen, for the appellant.
    . The court erred in- allowing the defendants to prove the pecuniary condition of Martin I. Borst, the plaintiff’s testator, at the date of the note in suit, and from thence to the time that the plaintiff’s claim was presented to the defendants for payment. (Alexander v.- Butcher, 7 Hun, 439 [14 N. Y. S. C. R.] ; Baby v. Ericsson, 45 N. Y. R., 786.) The court erred in admitting evidence as to the pecuniary condition of Yan Yalkenburgh, the defendant’s testator. (Best on Ev., vol. 2, p. 690 ; note (v), per Lord ElleNboeougii : Benebridge v. Osborn, 1 Stark, 374.)

      Ellsworth & Potter, for the respondents.
   Talcott, P. J.:

This is an. appeal from a judgment rendered on a verdict at the Niagara Circuit, and from an order denying a new trial, on a motion made on the minutes of the Circuit judge.

The action was originally commenced by Martin I. Borst, the plaintiff’s testator, and was upon a promissory note purporting to have been made October 26,1868, by Daniel A. Yan Yalkenburgh, the testator of the defendant, payable sixty days after date, to the order of the said Borst, at the New York State National Bank, Albany, and on two other alleged causes of action which were withdrawn at the commencement of the trial, leaving the action to be tried solely on the alleged note. The answer interposed by the defendants, the executors of Yan Yalkenburgh, was a general denial, payment, want of consideration, and that the note was made solely for the accommodation of the said Borst, the payee. But the real defense relied on was, that the note had been made and delivered to Borst in an imperfect and unfinished condition, as a memorandum or voucher for some money, at the same time advanced by the Exchange Bank at Lockport to the Bank of Montreal, which was sent in the form of a gold draft, drawn by the said Exchange Bank, on its correspondent the Metropolitan Bank of New York, of which the cashier of the Exchange Bank on the same day advised the Metropolitan, and requested it to purchase the gold to pay it with, and charge the cost of the gold to the Exchange Bank. The price of gold being at the time fluctuating from day to day, -which was the occasion of the note not being perfected.

That the note was intended to be discounted by the Exchange Bank at Lockport, or by the State .National Bank at Albany, to provide funds to reimburse the Exchange Bank, for the amount of the gold draft which it remitted to the Bank of Montreal, to pay an amount which then became due to the Bank of Montreal, on a transaction concerning the purchase of a distillery in Canada, in which Borst and Van Valkenburgh were interested, but which was afterwards otherwise arranged; and that the fact that Borst had .this memorandum note ivas overlooked and forgotten until after the death of Van Valkenburgh, when it was produced against the executors of Van Valkenburgh by Borst, and set up as a valid claim against the estate of Van Valkenburgh. The note was produced on the argument, and was in the form following, viz:

“$7. ' Lockport, N. Y., October 26, 1878.
“Sixty days after date, I promise to pay to the order of M. I. Borst, seven thousand and three hundred dollars, at the New York State National Bank, Albany, N. Y.
“ Value received. D. A. VAN VALKENBURGH.”
“No.-. clue-.”

At the time when the alleged note bears date, Borst was the president of the Exchange Bank of Lockport, and Van Valkenburgh was a director. Mark A. Nicholls, the plaintiff, was the cashier of the bank, and the note was made by partially filling up one of the blank forms of notes kept by the said Exchange Bank. It was filled up by said Nicholls, but he had no recollection of the transaction, or of the occasion when it was filled up, or the purpose of the note.

The defense was sought to be sustained by circumstantial evidence, in the course of which the defendant gave in evidence many circumstances tending to show the financial situation of Martin I. Borst, and also of D. A. Van Valkenburgh, at and about the time when the note purported to have been made; and afterwards, after the note, by its terms, purported to have become due and remained unpaid, with a view not only of showing, from the transactions of the parties, the probability that the note was signed at the time and for the purpose claimed by them, but also of showing, by inference, the improbability that, if the note represented an actual and bona fide claim against Van Valkenburgh in favor of Borst, it would have been permitted by the latter to have remained overdue, and without any demand of payment or attempt to collect the same in the life-time of Van Valkenburgh. Both descriptions of testimony of this character were taken under the objection of the .plaintiff’s counsel ás to inadmissibility, for the purpose of showing the financial position of the parties, and on the ground that it was wholly irrelevant to any of the issues in the case.

* In the case of Nicholson v. Waful (70 N. Y., 604), the Court of Appeals recently reversed the General Term decision of this department, which had held that evidence that the plaintiff had declared that he had not $100, and that he was working in a mill at $1.50 per diem, was admissible in a case where the defendant was sued on

• a note for $450, and declared that ho had never made such anote; or, if he had, it was while he was intoxicated, and he only received $250, for which amount he had given his noté. So far, however, as the reports show, there was nothing in the case, either in the form of the note or in any of the collateral circumstances proved, tending to show that it was given as a memorandum, or for any other purpose than as a security for the payment of the amount . specified in it. (See the case reported in Sup. Ct., 6 Hun, 655; 70 N. Y., 604.)

We think the case of Nicholson v. Waful rests on its own peculiar circumstances, and on the inconclusive nature of the evidence offered. Here, the evidence admitted was offered as only one of various circumstances tending to establish the fact that the alleged note did not represent an actual and valid claim of Borst against Van Valkenburgh, and we think, in this case, it was properly admitted for the consideaation of the jury, together with the other evidence bearing on the subiéct. (See opinion of Johnson, J., in Wardell’s Adm’r v. Elmendorf’s Adm'rs, 10 N. Y., 171; Burlew v. Hubbell, Sup. Ct., 3d Dept., 1 T. & C., 236; Stevenson v. Stewart, 11 Penn., 307; examined in Woods v. Gummert, 67 Penn. St., 136, and the remarks of’the Chancellor and Senator Mason, in Miller v. Smith’s Ex’rs, 16 Wend., 425, at pp. 435, 443-447 of the case.)

The precise questions presented by those objections seem to have been considered, and the objections overruled in a recent decision of the Supreme Court of Illinois. (Thorp v. Goewey, “The Reporter,” Vol 5, No. 21, p. 619, May 22, 1878.)

The evidence, as to the personal relations existing between Borst . and Van Valkenburgh at a period subsequent to the supposed maturity of the note, was admissible to go to the jury with the other evidence. It afforded grounds for a presumption that, if the note had been a valid claim in the hands of Borst, it would probably have been demanded, and its payment enforced. It also tended to throw light upon and explain certain other facts disclosed by the testimony.

The testimony of Thomas N. Yan Yalkenburgh, as to his knowledge of the alleged, note, and as to whether it or its proceeds entered in any way into the business of D. A. Van Valkenburgh, was, we think, admissible. His intimate connection with, and knowledge of the business of his father, the reputed maker of the note, and the fact that he kept his father’s books, had been stated by him, and his want of knowledge on the subject, though, perhaps, entitled to little weight, was proper to be laid before the jury-

The objections to the reading in evidence of the discharge of the mortgage by the Bank of Montreal, if any of them are well founded, are not very material, as the payment of the mortgage was otherwise proved by the testimony of Thomas N. Van Valkenburgh. .

• The objection to the testimony of Thomas N. Van Valkenburgh, as to what took place between his father and Mr. Borst on the 24th of November, 1869; that the same was incompetent under section 829 of the Code of Civil Procedure, does not seem to be well taken. The witness was only a spectator at that inteiwiew, and the communication was not, in any sense, one had between the witness and Borst personally. (Cary v. White, 59 N. Y., 336; Hildebrant v. Crawford, 65 N. Y., 107.)

The exceptions referred to appear to embrace all those of any importance. Though the case is not without difficulty, we think, on the whole, that it presented a question of fact for the jury, which they have disposed of as intelligently, and as much in accordance with the justice of the case, as could have been expected.

The judgment and order refusing a new trial should be affirmed.

Present. — -Talcott, P. J., Smith and Hakdin, JJ.

■ Judgment and order denying new trial affirmed.


text:
    EDWARD A. FORSYTH, Appellant, v. CHARLES S. CAMPBELL, Respondent.

      Judgment — mere itregulanty is no defense to a sJieriff sued for neglect to return an execution — Oder directing it — not sufficient jproof of a judgment.

    In an action against a sheriff for neglecting to collect and return an execution, plaintiff must show a valid judgment upon which the execution was issued.
    A sheriff cannot, however, in such an action take advantage of a mere irregularity in a judgment, rendering it voidable but not void.
    To prove the existence of a judgment upon which the execution was issued, plaintiff produced a certified copy of an order for judgment, made by the County Court, directing the reversal of a judgment of a justice of the peace, and directing judgment for the defendant (the present plaintiff) for his costs, $27.26, the amount of the alleged judgment. Held, that this was not sufficient to prove the existence of a valid judgment.
    The practice of borrowing and carrying away from the clerk’s office original records and other papers on file disapproved of.
    Appeal from a judgment of the County Court of Monroe county, reversing a judgment of a Justices’ Court in favor of the plaintiff.

      I. D. DecJeer, for the appellant.

      G. II. Humphrey, for the respondent.
   Talcott, P. J.:

This is an appeal from the judgment of the County Court of Monroe, reversing a justice’s judgment.

The defendant was sheriff of the comity of Monroe. The action was brought against him in a Justices’ Court for neglecting to collect and return an execution in favor of the plaintiff. The execution was issued’October 31, 1874, and the action was commenced January 24, 1876. The justice rendered a judgment in favor of the plaintiff for $29.76 damages, besides costs, which was reversed by the County Court, on the ground, as stated in the opinion of the county judge, that there was no sufficient proof of a judgment authorizing the issuing of the execution. The appellant’s counsel takes the position that it was not necessary for the plaintiff, on the trial of this action, to show a judgment ; that it was enough for him to prove an execution valid on its face. The position is not tenable. Although process, valid on its face, is a protection to the officer, if he executed it, yet he is not obliged to act under it, if it is in fact void. (Earl v. Camp, 16 Wend., 562 ; Cornell v. Barnes, 7 Hill, 35.)

It follows that in an action against a sheriff for neglecting his duty under an execution, the plaintiff must show a valid judgment upon which the execution issued. So held in an action for a false return to a ft. fa. (McDonald v. Bunn, Sheriff.\ etc., 3 Denio, 45.)

It is not necessary, however, to show a judgment regular in all respects. The sheriff cannot take advantage of a mere irregularity in the judgment, rendering it voidable, but not void. (Ames v. Webbers, 8 Wend., 545; Parmelee v. Hitchcock, 12 id., 96 ; Carpenter v. Willett, 28 How., 225; S. C., 31 N. Y., 90.)

The judgment, on which the execution in this case was issued, as alleged in the plaintiff’s complaint, was a judgment rendered by the County Court of Monroe, in favor of the plaintiff herein, against Levi Cooley and Levi Cooley, Jr., for $27.26.

On the trial before the justice, the plaintiff put in evidence, a certificate under- the hand and seal of the clerk of the county of Monroe, annexed to a paper which was in the usual form of an order for judgment. In respect to the title of the court, the names of the parties, and the amount of the judgment, it corresponded with the allegations in the complaint.. .

It recited the fact that an appeal had been brought on for argument and argued before the court, and it. adjudged and ordered that the judgment in the Justice’s Court, from which the appeal was taken, be reversed, and that the appellant (the plaintiff herein) recover $27.26 for his costs and disbursements, and that he have judgment against the defendants (the Cooleys) for that sum.

It was signed by the deputy clerk. The certificate signed by the clerk was to the effect that he had. compared the annexed copy of a judgment, with the original entered in his office, and that it was a transcript therefrom, and of the whole of said original.

The paper was not a judgment-roll or a judgment, but was merely a certified copy of an order for a judgment (Townshend v. Wesson, 4 Duer, 342.) It is contended, however, by the appellant’s counsel, that the paper was evidence that the order for judgment had been entered in the clerk’s office, and consequently that the plaintiff was entitled to have a judgment, entered and docketed, in due form, according to its terms. And that thereupon it became the duty of the clerk to make up and file the judgment-roll, and enter and docket the judgment. From these premises, it is argued that it is to be presumed that the clerk performed his duty,-in the absence of proof to the contrary; and that if he omitted to do so, it was a mere irregularity which the court would not permit to prejudice the party, and which it would order to be amended, and consequently that, as between the plaintiff in the execution and the sheriff, the evidence was sufficient to warrant the presumption that a j udgment was entered and docketed according to the order of the court.

The question is to be disposed of according to the provisions of the old Code, 'which was in force when the execution was issued. The answer to the position is that, if it be assumed that it was the duty of the clerk to enter the judgment in the judgment-book, upon the order of the court being entered (Code of Procedure, § 280), he was not under an absolute duty to make up and file a judgment-roll, unless the papers needed to constitute the roll were then on file hi his office (§ 281), of which fact there is no evidence whatever.

It is to be observed that section 282 of the Code gives some countenance to the idea that the filing of the roll and .the docketing of the judgment are only necessary to create a lien on real estate, and that an execution against personal property may be issued on the judgment being entered in the judgment-book. But section 289 shows very clearly that such is not the case. The execution must state inter alia the county where the judgment-roll is filed; and, if it be against property, it must require the officer to satisfy the judgment out of the personal property of the debtor; and, if sufficient personal property cannot be found, out of the real property belonging to him on the day when the judgment was docketed. For these reasons, we concur in the opinion of the county judge that there was not sufficient proof of a judgment.

The appellant’s counsel has undertaken to supply this defect in his proof by producing, upon the argument before us, what purports to be a certified copy of the judgment-roll in the case in which the execution was issued. Similar evidence has frequently been received by the court in bane in opposition to a motion for a now trial.

It is not admissible in an appellate court to reverse the judgment of an inferior court, for the reason that it shows no error committed in the court below. (Stilwell v. Carpenter, 62 N. Y., 639; Porter v. Waring, 69 id., 250.)

Our attention has been called to the fact that a paper, purporting to be the original judgment-roll, filed in the clerk’s office, was offered in evidence by the plaintiff, on the trial before the justice, and was excluded on being objected to by the defendant.

Wo do not see how that fact aids the plaintiff, even if we assume that the testimony was erroneously excluded by the justice. The appellant had the opportunity to offer the record on the argument of the appeal in the County Court (if it was admissible on appeal), and his omission to do so is not excused. But it is not clear that the paper was admissible in evidence before the justice. If it was what it purported to be, it should have been in the possession of the county clerk. But it was produced before the justice by the plaintiff’s attorney, as a witness who claimed for it that it was an original record, filed in the county clerk’s office. It did not appear that the witness had been deputed or authorized, to produce it before the justice. The-paper offered was not authenticated .by the seal or signature of the clerk, nor did the witness explain how it came into his possession.

On these grounds, it was objected to and excluded. The merits of this particular ruling of the justice are not before us, as the plaintiff did not appeal from his decision; but, in so far as it tends to check the somewhat prevalent and very mischievous practice of borrowing and carrying away from the clerk’s office original records ■ and other papers on file, it deserves commendation.

We think the judgment of the Comity Court should be affirmed.

Present — Talcott, P. J., and Hardin J.; Sjiith, J., not. sitting.

Judgment of the County Court of Monroe county affirmed.


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    THE CITY OF ROCHESTER, Plaintiff, v. THE TOWN OF RUSH, Defendant.

      Property of a municipal corporation is not subject to taxation.

    Section 1 of 1 R. S., 3S7, declaring- that all lands and personal estate, whether owned by individuals or corporations, shall he liable to taxation, applies only to private corporations, and does not include municipal corporations. Accordingly where the city of Rochester, in carrying out a system of works for supplying the city with water, erected a reservoir in the town of Rush; held, that the town had no authority to assess the same and impose ordinary taxes thereon.
    Controversy submitted on agreed facts under section 1279 of the Code of Civil Prodedure.

      James B. Perkins, for the plaintiff.
    The tax imposed was illegal, because the town of Rush had no power to levy a tax upon the property of the city of Rochester. That this extraordinary power does not exist has been decided. (Worcester Bo. v. Mayor of Worcester, 116 Mass., 193; Inhabitants of Wayland v. Commissioners, 4 Gray, 500; Piper v. Singer, 4 Serg. & Rawle, Pa., 354; Hilliard on Taxation, chap. 5, p. 141, § 4; U. 8. y. JR. JR. Co., 17 Wallace, 322; People v. Doe, 36 Cal., 220, 222; People y. McCreary, 34 Cal., 433; 'Doyle v. Austin, 47 Cal., 353, 360; Directors of Poor y. School Directors, 42 Pa., 21; Cooley on .Taxation, chap. 3, pp. 58, 59.)

      J. A. Stull, for the defendant.
    The reservoir property was not owned or used for purely public purposes, in any such sense, as exempted it either from taxation or execution. ( Qity of Louisville y. Commonwealth, 1 Duvall, 295-2$8; Cooley on Taxation, 489; Burroughs on Taxation, p. 41, § 75; Dalrington v. Mayor of W. Y., 31 N. Y., 164, see pp. 192, 193, opinion by DeNIO.)
   Talcott, P. J.:

This is a case agreed upon and submitted to the court under §§ 1279, 1280 and 1281 of the Code of Civil Procedure. The object of the submission is to have a judicial determination of the question, whether the said town of Rush can impose ordinary taxes upon a certain reservoir, part of, and necessary to the system of works by which water brought from Hemlock lake, in Livingston county, is supplied to the city of Rochester.

The said water-works were built under a statute passed in 1872, chapter 387, and subsequent acts amendatory of, and in addition thereto, and the city of Rochester paid for the construction of the same some three millions of dollars, by issuing its bonds and selling the same under the statutes aforesaid; and the city is authorized by the said acts to raise, by tax, the necessary sums to pay the interest on said bonds, and the principal as it matures. With the exception that the water is used for fire purposes, and in the public buildings of the city, and in the public parks, no person is per- ' mitted to use the water, except by paying for the use of it at certain scheduled prices, called water-rates. In the course of the construction of said water-works, and as a necessary part thereof, the city purchased twenty-nine acres of land, located in said town of Rush, and erected thereon, at the cost of $100,000, a reservoir, in which the water is stored, and from thence carried to and distributed within the city; and, in 1876, the assessors of the town of Rush taxed the said pi-operty at a valuation of $60,000 for the sum of $484.94, and the board of supervisors of Monroe county issued their warrant for the collection of said tax, which was levied •upon certain personal property of the city, and the collector threatening to sell the property thus levied upon, the city paid the collector, under protest, on the 1st day of February, 1877, the sum of $511.38, being the amount of the tax, with interest and collector’s fees.

The money was paid by the collector to the comity treasurer of Monroe county, and by him was paid to the proper authorities of the town of Rush, to the extent of $55, in payment of the expenses of the said town, and the balance was paid over to the State, and retained and used by the said treasurer for county purposes.

We think the property was not subject to taxation, and that the assessors of the town of Rush had no authority or jurisdiction to place the same upon the tax-roll as liable to taxation.

A municipal corporation is a political body, and, as such, one of the agencies of government. Its powers and franchises are devolved upon it by the State for convenience, and to be exercised as a part of the powers of the State government. The provisions of the statute declaring that all lands and personal estate, whether owned by individuals or corporations, shall be liable to taxation (1 Edm. R. S., 360, § 1), apply only to private corporations, and do not include municipal corporations. The agencies of government are, from their nature, exempt from taxation, irrespective of any statute specially exempting them. (Cooley on Taxation, chap. 3.)

Judge DilloN, in his work on municipal corporations, on this subject, says : “ The general statutes of the State upon the subject of taxing properly undoubtedly refer to private property, and not to that owned by the State; and, in view of the public nature of municipalities, the author is of opinion that such enactments do not, by implication, extend to any property owned by them— certainly to none owned by them for public purposes.” (2. Dillon on Municipal Corporations, § 614.)

The money expended by the city of Rochester in the construction of its water-works was, in effect, to be raised by general taxation upon the inhabitants of that city for a purpose purely public. To tax the constructions erected by the city, in pursuance of such authority, is, in effect, to tax the amount already raised by taxation. If this tax could be legally imposed upon the erections for the purpose of the water-works, under the general authority by which the town of Rush is authorized to tax the property located within that town, by the same process of reasoning the city of Rochester could impose taxes on the court-house and other county buildings located within it; and if they could impose the tax, they could proceed to sell the property in default of payment.

It was held in The Directors of the Poor, etc., v. The School Directors, etc. (42 Penn St., 24), that a county poor-house is not taxable for school purposes by the school directors in the township where it is located, on the ground that the public is never subject to tax laws, and no portion of it can be without express statute, and that no exemption is needed for any public property held as such.

The precise question presented in this case is decided in The Inhabitants of Wayland v. The County Commissioners, etc. (4 Gray, 500), where the town of Wayland had assumed to impose a tax upon the city of Boston for certain real estate located in that town, owned by the city in connection with its water-works. And also in the case of the Town of West Hartford v. The Board of Water Commissioners of the City of Hartford (44 Conn., 360). No objection is made that the action should be against the county of Monroe, and not against the town which imposed the tax.

We think that the property was not taxable, and order a judgment in behalf of the plaintiff for the amount of the $511.38, paid by it to prevent a sale of its property, with interest from the first day of February, 1877, with the costs for all proceedings subsequent to the notice of trial.

Present — Talcott, P. J., Smith and HaudiN, JJ.

Judgment ordered in behalf of the plaintiff for $511.38, with interest from the first day of February, 1877, with the costs of all proceedings subsequent to the notice of trial.


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    EVA HOEFFLER, Appellant, v. BYRON H. WESTCOTT, JOSEPH BORK and others, Respondents.

      Sale of bond and mortgage by firm — all members of the firm estopped from denying its validity.

    Plaintiff, on the morning of December 1, 1874, came to the banking house, of the firm of Lyon, Bork & Co., at Buffalo, and deposited $1,100, requesting the firm to get her a good bond and mortgage. In the afternoon she returned, and was handed a bond and mortgage for $900, executed by Westcott to Bork, both of whom were members of the firm, and an assignment thereof by Bork to the plaintiff, in which Bork covenanted that there was $900 due thereon, she received also a bond and mortgage for $200, and in addition $83 in money nothing being said at the time about the mortgages as to a bonus or any rate of discount or interest.
    In ati action to foreclose the $900 mortgage, Bork claimed that the mortgage was given on property in which he and Westcott were jointly interested; that it was given to Westcott to sell for joint account; that it was purchased by plaintiff at a usurious discount, and was void. Held, that as the mortgage was given to the plaintiff by the firm as a good bond and mortgage, each of the members was estopped from setting up that it was invalid, and that the defense should be overruled.
    Appeal from a judgment in favor of the defendants, entered upon the trial of this action by the County Court of Ene county, without a jury.

      John O. Ilubbell, for the appellant.

      J. P. Carr, for the respondents.
    The assignee of a mortgage, though a bona fide bolder, takes the same subject to all the equities existing between the original parties. (Ingraham v. Disbrough, 47 N. Y., 421; Andrew v. Gillespie, id., 487 ; Gutts v. Guild, 59 id., 229 ; Grane v. Turner, 67 id., 437.) This mortgage was made without consideration and for the purpose of a sale only ; it was sold for less than its face value, and the transaction was therefore usurious. (Vickery v. Biclcson, 62 Barb., 272 ; Payne v. Burnham, 62 N. Y., 69 ; Eastman v. Shaw, 65 id., 522.) Where more than legal interest is intentionally taken, the transaction is usurious, though the party act in ignorance of the law. (Bank of Salina v. Afaord, 31 N. Y., 473.) If there be a loan and reservation of more than seven per cent for the use of money, tliQ transaction is usurious whatever form it may take. (Fielder v. Darrin, 50 N. Y., 437 ; Birdsall v. Patterson, 51 id., 43.) The usury in this case was accepted and ratified by the principal, even if Bork can in any sense be regarded as her agent. She received and retained the fruits of the transaction with full knowledge of the facts. ('Algur v. Gardner, 54 N. Y., 360 ; Fstevez v. Purdy, 66 id., 446 ; Fhoell v. Chamberlin, 31. id., 619 ; Bennett v. Judson, 21 id., 238 ; Murray v. Bininger, 3 Keyes, 107 ; Meehan v. Forrester, 52 N. Y., 277.)
   Talcott, P. J.:

This is an appeal by the plaintiff from a judgment rendered for the defendant by the County Court, of Erie county.

The action is to foreclose a mortgage made by Byron IT. Wcst. cott to Joseph Bork to secure the payment of $900, with interest, within three years from the date thereof. The mortgage and the accompanying bond were dated on the first day of November, 1874.

The facts as disclosed by the evidence were, that Mrs. Hocffler, the plaintiff, about the first day of December, in the year 1874, in the forenoon, came into the banking office of Lyon, Bork & Co., bankers, in Buffalo, with which firm she had been in the habit of transacting business, and deposited with the said firm the sum of $1,100 in money. The defendants, Byron II. Wcstcott and Joseph Bork, were two of the members of the firm of Lyon, Bork & Co. Bork was present and received the money from Mrs. Hocffler. She left the money there with the request that it should be invested in the purchase of a bond and mortgage — Lyon, Bork & Co., being also agents for others and dealers in real estate. Nothing was said about any particular mortgage or any rate of discount or interest, but according to the statement of Mrs. Hocffler, she, at the time of leaving the money, requested Mr. Bork to get her a good bond and mortgage. Mr. Bork’s account of the transaction is substantially the same. In the afternoon, Mrs. Hoeffler returned to the office of Lyon, Borle <fc Cc., and received from Mr. Bork, in an envelope, the mortgage in question, with an assignment thereof, executed and acknowledged by Bork to her, covenanting that there was $900, and interest due thereon, and that he could lawfully transfer. Also, one other mortgage for $200, the particukrs of which as to the parties and date are not stated, and $83 ■in money; and Mrs. Hoeffler took away the envelope with its contents. Nothing being said about the contents, and no explanation being made by Bork in reference to the mortgages, or either of them, or to the amount of money contained in the envelope; and no agreement being made or spoken of as to any rate at which she was to receive the mortgages, or any rate of discount or interest which she was to receive upon the trausation, so far as the evidence discloses.

In point of fact, the defendants, Westcott and Bork, were jointly interested in the premises covered by the mortgage; the title, however, standing in the name of Westcott, and, as testified to by Westcott, the bond and mortgage were made to Bork for the purpose of raising money for the benefit of Bork and Westcott on the property, and no consideration passed between Bork and Westcott for the bond and mortgage in question, but the same was made with the understanding between them, that Bork should raise money on the same for the benefit of both parties.

The defendant, Bork, in the absence or without the knowledge or consent of the plaintiff, entered up the transaction on the books of Lyon, Bork & Co., as a sale of the bond and mortgage to Mrs. Hoeffler, at a discount of eight per cent., and the $1,100 deposited by Mrs. Hoeffler, less the $83 returned in the envelope, went to the credit on the books of Lyon, Bork & Co. of the two co-partners, Westcott and Bork.

The defendant, Westcott, alone answered in the action, and set up that the bond and mortgage were made by him to Bork to raise money, and that the plaintiff’ and Bork entered into a corrupt and usurious agreement, by and in pursuance of which the plaintiff lent to said Bork the sum of $833 only upon the said bond and mortgage, and reserved and retained the suni of $67, besides the legal interest stipulated in said bond and mortgage, as a consideration for the use and forbearance of the said sum of $833, for a term, from the 1st of December, 1874, to the time of the maturity of said bond and mortgage.

■ The action was tried before the county judge, without a jury, and he found, as facts, that the bond and mortgage had no validity in the hands of Bork, and that he (Bork) sold and assigned the same to the plaintiff, at a discount of eight per cent., which “ was intended by said Bork and said plaintiff as a bonus, in addition to the legal interest secured to be paid by said bond and mortgage; ” and, as a conclusion of law, he found that “ said sale and transfer of said bond and mortgage was corrupt and usurious; ” and that, by reason thereof, said bond and mortgage were usurious and void, and he ordered a judgment in favor of the said Westcott, dismissing the complaint, with costs. The judgment, as entered, was for a dismissal of the complaint generally, with costs in favor of the defendant, Westcott. The judgment was clearly erroneous.

, In the assignment of the mortgage, Bork had covenanted that there was then due and owing thereupon the sum of $900, and interest from the 1st day of November, 1874, and that he was lawfully authorized to sell the same, and had covenanted that the same would be paid according to the terms and conditions thereof.

This was averred in the complaint, and therein the plaintiff demanded judgment against both Westcott and Bork for any deficiency which might remain after exhausting the mortgage security. Bork made no answer in the matter, and no defense.. As to him, the court, having acquired jurisdiction of the action, could have proceeded to render judgment against him on his guaranty of payment, notwithstanding the defense interposed hi behalf of W estcott.

, But we are, further, of the opinion that the decision of the County Court was erroneous in holding the bond and mortgage void for usury in the hands of the plaintiff There was no foundation in the evidence for any finding that the plaintiff purchased the bond and mortgage at a discount of eight per cent, or that she was a party to any usurious or corrupt agreement concerning the same. The only witnesses sworn were the two defendants, Westcott and Bork, and the plaintiff. The plaintiff testified that when she deposited the money she requested that a good mortgage should be procured for hei*. This was not denied by either of the defendants, and in itself was highly probable. A good, mortgage meant a valid mortgage. “A security which the law declares is illegal and void, cannot be either good or bona fide. To be a good security, it must be a valid one.” (Norris v. Wood, Impl’d, etc., vol. 7 N. Y. Weekly Dig., 8 ; Baron v. Marks, vol. 6 id., 312.)

The money of the plaintiff was intrusted to the firm of Lyon, Bork & Co., and the transaction, so far as the plaintiff was concerned, was with that firm, according to the testimony. The defendants, Westcott and Bork, were both members of that firm, and to impose upon her the mortgage in question, under a request and authority to purchase for her a good mortgage, was a fraud and violation of duty ; and each and every member of the firm of Lyon, Bork & Co., which firm acted as the agents of the plaintiff in the transaction, is estopped from now setting up the violation of duty on the part of the firm as against the plaintiff, who was entirely innocent of any attempt or intention to violate the statute of usury (Schoop v. Clark, 1 Keyes, 181), and who, it is to be presumed, would not have accepted the bond and mortgage had she been apprised of its true character. The mortgage was dated, acknowledged and recorded before the plaintiff deposited the money, or had requested Lyon, Bork & Co. to invest the same for her in the purchase of a good mortgage. When the assignment and the mortgage were delivered to her without any further communication, she was justified in supposing that it was done in compliance with her instructions, and was a good and valid mortgage in the hands of Bork, a member of the firm ; and the transaction was equivalent to a representation that it was such, and a representation that no member of the firm can now justly be permitted to deny to the injury of the plaintiff.

The judgment of the Comity Court is reversed, and a new trial ordered in that court, costs to abide the event.

Present — Talcott P. J., Smith and Hardin, JJ.

Ordered accordingly.


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    MARY ELIZABETH RICHMOND, Respondent, v. THE NIAGARA FIRE INSURANCE COMPANY, Appellant. SAME v. REPUBLIC FIRE INSURANCE COMPANY. SAME v. GERMANIA FIRE INSURANCE COMPANY. THE COMMERCIAL NATIONAL BANK OF OSHKOSH, Respondent, v. THE NIAGARA FIRE INSURANCE COMPANY, Appellant.

      Insurance policy— one to whom, loss is payable, bound by breach of condition by the insured.

    Where a fire policy names the ostensible owner of the property as the person insured, and declares the damages payable, in case of loss, to another person, or when the policy is formally assigned to another person, and an action is brought by him, the person to whom the loss is payable, or the assignee, cannot recover, where the conditions of the policy have been broken by the assured.
    Berry & Co., who owned a warehouse at Oshkosh, in which was stored some 15,000 bushels of wheat, in one mass, being desirous of borrowing $3,000, drew a draft upon one Richmond for that amount, and attached thereto a warehouse receipt, by which they acknowledged to have receivedfrom, and to hold subject to his order, 2,500 bushels of wheat, loss by fire and heating at owner’s risk. Richmond paid the draft. Subsequently another draft, for the same amount, with another warehouse receipt attached thereto, was drawn upon, and paid by, Richmond. The 5,000 bushels were never separated from the rest, nor was any bill of sale made, but it was intended that the wheat should be kept in the warehouse to secure the payment to Richmond of the amount of the drafts.
    After the execution of each receipt, Berry & Co. applied to, and obtained from, defendants’ agent policies of insm>ance on the wheat to them as owners, one payable to whom it might concern, and the other to Richmond. The policies provided that, if the interest of the assured in the property was other than the entire, unconditional and sole ownership, it must be so represented; otherwise, the policy should be void.
    In an action on the policies- by the plaintiff, as executrix of Richmond, to whom they had been assigned after a loss by fire, held, that, at the time they were issued, the legal title was in Richmond, and Berry & Co. had only an equitable ■right of redemption, and that, by their failure to so inform the companies, the policies were rendered void.
    Appeal from a judgment in favor of the plaintiff, entered in Erie County upon the trial of this action by the court without a julT*

      Spencer Qlinton, for the appellants.

      A. P. Laming, for the respondents.
   Talcott, P. J.:

This is an appeal from a judgment rendered at the Erie Circuit ón a trial by the court without a jury.

The action is upon what is called an underwriter’s policy issued by the Germania, Hanover, Niagara and Republic Fire Insurance Companies of the city of New York, whereby the said companies, each acting and contracting for itself, and not one for another, in consideration of one-fourth of the respective sums to be specified as premiums and indorsed thereon, did each insure A. C. Osborne, of Oshkosh, Wisconsin, for account of the respective persons therein after referred to as entitled to the benefit of the said policy, against loss or damage by fire, to the amount of one-fourth part of the respective sums, which, within the limits thereinafter mentioned, should be indorsed on the said policy, and specified in the column on the other side, headed “amount insured” upon such produce and other merchandise, whether hazardous, not hazardous, extra hazardous, situated or being in such storehouses or places, at or in the immediate vicinity of Oshkosh, Wisconsin, and for such period of time not exceeding one year, as should also, be specified by way of indorsement thereon, in the appropriate columns for such purposes on the other side, and also specified in the certificate thereinafter mentioned. It being understood and agreed, that no sum greater than $50,000 should be insured under the said policy upon produce or merchandise which should be in any one storehouse or place at the same period of time; and it being further understood that the insurance thereby made should be for the benefit of the respective parties only whose names should be written on the other side in the column arranged for that purpose, and to whom a certificate of authentication by the general agent of the said insurance companies, specifying the name of such person, the amount and period of such insurance, the premium therefor, the goods insured and the place of their location, signed by the said A. C. Osborne, shall be issued simultaneously with the indorsement of the risk upon the said policy, and at the time when he shall agree to permit such person to come in under the said policy.

The policy then went on to specify divers conditions as in an ordinary fire policy, and amongst other conditions was the following : “If the property be sold or transferred or any change takes place in the title or possession, whether by legal process or judicial decree or voluntary transfer or conveyance, * * * * or if the interest of the assured, in the property, whether as owner, trustee, consignee, factor, mortgagee, lessee, or otherwise, is not truly stated in this policy. * * * * If the interest of the assured in the property be any other than the entire, unconditional, and sole ownership of the property, for the use and benefit of the assured, it must be so represented to the companies and so expressed in the written part of this policy, otherwise the policy shall be void.”

Wm. M. Berry & Co. were in the occupancy of a storehouse and elevator in Oshkosh, known as the Northwestern Elevator, which they used for the purpose of receiving, storing, and elevating grain; and at the time of effecting the insurance sought to be recovered for in this action, the said Wm. M: Berry & Co., were the owners of, and had in store in said elevator 15,811 bushels of wheat of the value of $1.70 per bushel, and of the,, aggregate value of $26,878.70.

They were accustomed to issue what are known as warehouse receipts — such as that issued to Dean Richmond and hereinafter set forth, and borrowing money upon the same in different amounts from divers persons, and pledging said warehouse receipts as collateral security for the repayment of such loans.

During all this time the said 15,811 bushels of wheat lay nx said elevator in one ■ mass, in nowise separated or in any manner distinguishable so that the wheat specified in any one of such warehouse receipts could be distinguished from that specified in any other of such receipts; and, as we understand the case, the evidence and the findings at the tidal show that the said Wm. M. Beriy & Co. had issued warehouse receipts for wheat, in different amounts and at different times, to different persons, by which wheat in said elevator, purported to be held by said Wm. M. Berry & Co., subject to the order of the persons severally named in the said warehouse receipts, and before the receipts hereinafter mentioned as issued to Demi Richmond, greatly in excess of the said 15,811 bushels which the said Berry & Co. had in said elevator-. And there was no evidence or finding that the said "Wm. M. Berry & Co. had any wheat elsewhere than in said elevator. Nor did it appear on said trial, or by the findings therein, that there was any excess of the value of said wheat, so previously pledged, over and above the amounts for which the said warehouse receipts, or the wheat mentioned therein, had been so previously pledged, so that there was under the control of the said "Wm. M. Berry & Co. any wheat, or the right of redemption in any wheat, at the time when the insurances to recover which this action is brought purported to have been made and effected. If this be so, it is difficult to see that there was any property owned by Wm. M. Berry & Co., or in which they had any valuable interest at the time when the two policies on which this action is brought were issued to Wm. M. Berry & Co., upon which the policies could attach.

The finding that there was enough wheat in the Nortnwestern Elevator, at the time in question, to be equal to the amount alleged to have been insured by the two policies in suit, is not sufficient, as, we think, to authorize a recovery of the amount insured by the two policies in question, when it also appears that the whole legal title to the same, with substantially all the equitable interest of Wm. M. Berry & Co., had been previously pledged to other parties. However that may be, it is probably unnecessary in this case to go into a minute investigation of the facts touching the question, as we think the policies, even granting that they would have been valid and effectual to the extent of their face, by reason of the fact that there was enough wheat in the Northwestern elevator at the time of their issue, and to which the policies were supposed to apply, to satisfy the claim of Dean Richmond for his advances to Wm. M. Berry & Co.

Dean Richmond was engaged in business in the city of Buffalo, and, on the 12th day of May, 1866, loaned William M. Berry & Co. $3,000, and, as security therefor, they issued to him a warehouse receipt, in the words and figures following:

‘Northwestern Elevator, )
“ Oshkosh, May 12, 1866. £
“ Received in store, from Dean Richmond, twenty-five hundred bushels of wheat, subject to the order of Dean Richmond, upon the surrender of this receipt, loss by fire and heating at owner’s risk.
“2,500 bushels.
“(Signed) WM. M. BERRY & CO.”

. On the same day, Berry & Co. drew on Dean Richmond for $3,000, to which the foregoing receipt was attached, and the draft was paid by Richmond on presentation. Thereafter, on the 19th day of May, 1866, said William M. Berry & Co. applied to said A. C. Osborne, to whom the said open or underwriter’s policy had been issued, at Oshkosh, for insurance on wheat represented as belonging to them in the said Northwestern elevator, to the amount of $3,000, for one month from that date, the loss, if any, payable to whom it might concern; and thereupon the said A. C. Osborne, as agent of the said underwriting insurance companies, and in consideration of the sum of twelve dollars premium, paid to him for said companies, did indorse on said open policy the sum of $3,000, as the amount insured on wheat in said Northwestern elevator, for the period of one month from that day, for the benefit of the said Willliam M. Berry & Co., and did then and there deliver to said Berry & Co. a certificate, duly authenticated, in which it was specified that the said William M. Berry & Co. were insured, by each of said underwriting insurance compames, against loss or damage by fire, to the amount of one-fourth part of said sum of $3,000 on wheat contained in the said Northwestern elevator, for the period of one month, from the 19th day of May, 1866, to the 19th of June, in the same year. On the 21st of May, 1866, Dean Richmond made a further loan to William M. Berry & Co. of the further sum of $3,000; and, as security therefor, they issued to him a warehouse receipt for 3,000 bushels of wheat in the said elevator; which receipt was, in all respects, except as to date and quantity, the same as that above set forth; and, on the same day, drew a draft on said Richmond for $3,000, to which the receipt of that date was attached, and which draft was paid by the said Richmond on presentation; and, on the 23d of May thereafter, the said William M. Berry & Co. applied to the said A. C. Osborne for a further insurance of $2,000 on wheat in said elevator, for one month from that date, loss, if any, payable to Dean Richmond; and a certificate ivas duly issued to the said William M. Berry & Co. similar to the certificate issued in the former case, except that it contained a statement that the loss, if any, should be payable to Dean Richmond; but William M. Berry & Co. were named in the indorsements on the said policy as the parties insured.

Dean Richmond did not, in fact, supply any of the wheat mentioned in either of the said receipts, nor ivas there any bargain and sale of the wheat mentioned therein to said Richmond, as buyer, but it was understood and intended, between William M. Berry & Co. and Richmond, that the latter held the said warehouse certificates, and the wheat therein mentioned, as security for the money so advanced by said Richmond to William M. Berry & Co.

At the time the said warehouse receipts were issued and delivered to said Richmond, Berry & Co. had wheat in the said elevator in excess of the amounts mentioned in the said warehouse receipts; but the same was in bulk, and in no manner was it separated, or set apart, or otherwise identified as the wheat which was referred to in the said warehouse receipts.

On the 25th day of May, 1866, the said Northwestern elevator, together with the said 15,811 bushels of wheat therein contained, was destroyed by fire, and the value of the wheat so destroyed was $26,878.70. William M. Berry & Co. duly assigned the said certificate of insurance, dated the 19th day of May, 1866, to said Richmond, and delivered to him the said two certificates issued on the said open or underwriter’s policy in hisflife-time. Richmond died August 27, 1866, leaving a will, whereby he appointed the plaintiff sole executrix, which will was duly admitted to probate, and this action was afterwards commenced, whereby the plaintiff, as such executrix, sought to recover of the,. defendant the one-fourth part of the total amount insured in said two certificates of insurance issued under and upon said open policy.

The court found, as one of its conclusions of laAv, that, -“as between William M. Berry & Co. and Dean Richmond,' the title to the wheat mentioned in said receipts was transferred to Richmond, in trust, as a security for the payment of the money loaned by him to William M. Berry & Co., in the nature of a pledge or mortgage, with the equitable right of redemption in William M. Berry & Co., on payment to him of the money so loaned and advanced by him thereon, with interest,” and the court ordered a judgment for the plaintiff, as executrix, for the one-fourth of the amount so insured, with interest, amounting in all to the sum of $2,241.67.

In its answer, the defendant, among other defenses, set up a breach of the condition in said policy, that, if the interest of the assured in the property be any other than the entire, unconditional, and sole ownership of the property insured, for the use and benefit of the assured, it must be so represented to the companies in said policy named, and so expressed in the written part of the said policy; otherwise, the policy should be void. William M. Berry & Co. were the parties insured by the certificates issued under the said open policy, and were therein named as the owners of the property insured. Where a fire policy names the ostensible owner of the property as the persons insured, and declares the damages payable, in case of loss; to another person, the latter cannot recover in case of the breach of the conditions of the policy by the party insured; and the same is true where the policy itself is formally assigned and an action for ,the loss is brought by the assignee. Richmond was not the party insured, nor was his interest covered by the policy. He was in the one case the assignee of the policy; and, in the other, the appointee to receive the amount of the loss, if any became payable. This ride is fully established in this State. (See Grosvenor v. The Atlantic Fire Ins. Co., 17 N. Y., 391; Buffalo Steam Engine Works v. The Sun Mut. Ins. Co., id., 401, and Van Alstyne v. The Ætna Ins. Co., 14 Hun, 361.) The appointee to receive the money, in case of a loss, or the assignee of the policy, can only claim through the contract, and under and by virtue of its stipulations and conditions.

The learned justice who decided the ease at the Circuit fully acknowledges the principle in his opinion, Avhich is contained in the case, in treating of the question as to Avliat were the respective rights of Richmond and Berry & Co. growing out of the warehouse receipts.

It is found, as a fact in the case, that the business was in the order in which the several papers bear date; that is to say, that the insurance was obtained, and the certificates under the open policy issued, in each case, after the wheat specified and insured thereby had, by Berry & Co., been hypothecated or pledged to Richmond for the payment of the money advanced to them by him. There was no statement of that fact, in any manner, by Berry & Co., when they applied for the insurance, nor ivas the fact that Berry & Co. had parted with the legal or any title to the ivheat insured indicated upon the policy, or the certificates issued under the same; and Berry & Co., it appears by their proofs of loss, represented themselves as the sole owners of the wheat destroyed.

Wholly irrespective of any question of fraud in obtaining the policy or in the proof of loss, we are unable to see why an insurance thus obtained, as upon-the absolute property of Berry & Co., is not within the condition adverted to, which requires that if the interest of the assured, in the property insured be any other than the entire, unconditional, and sole ownership of the property, for the use and benefit of the assured, it must be so represented to the underwriting companies, and so expressed in the policy.

The importance to the underwriters of insisting on a compliance with this condition is obvious, and is illustrated by the facts of this case. Berry & Co., had, as we understand the facts of the case, a quantity of wheat in their elevator in bulk, on which they had largely over-issued warehouse receipts, and pledged them from time to time to various persons as securities for money borrowed. They procured insurances on the amount of the wheat specified in the several warehouse receipts, in their own names and for their own benefit, no statement being made in the policy that the only interest of Berry & Co., in any of the wheat insured, was only that of pledgors or mortgagors of the property; and it docs not appear that the policies were transfered in all cases to the pledgees or mortgagees. Under such circumstances, the temptation to fraud and the opportunity for its commission, greatly increased the “moral hazard” of the risk taken by the insurance companies, so that without any imputation of actual fraud in this case, it is easy to see that a faithful observance of the condition specified might be of great importance to the underwriters in several aspects of the case.

The learned justice who tried the case at the Circuit; we see, states in his opinion that, “ in none of the documents, making the contract of insurance between Berry & Co. and the defendant, is it stated directly or informally, that the assured had the legal and entire ownership of the property.” •

We think the learned justice overlooked or misunderstood the force of the condition relied on as a defense. The defense is not based upon the allegation of any false statement as to the ownership, but upon the omission to state fully and truly the situation of the property insured in that respect, and insuring the property as absolute owner, when in point of fact the insured was only the mortgagor, and had only the right of redemption in the wheat insured. We think, for this reason, that the judgment must be reversed.

Present — Talcott, P. J., Smith and Hardest, JJ.

In each of these cases judgment reversed and new trial granted, costs to abide event.