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    Frances T. Brown, App’lt, v. Alonzo Blackman, Ex’r, Resp’t.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Gift—Deliveby—Satisfaction of legacy.
    After executing a will giving certain land to his son charged with a legacy to his daughter of $2,000, which the son was to hold in trust -for her during her life, testator purchased a mortgage for that amount and caused the assignment to be made to the daughter and recorded, but placed the papers in the hands of the son to be held under the trust. Thereafter the daughter, at his request, executed a receipt for said sum, and in consideration thereof released all claim to the legacy and bequest, and thereafter the interest on the mortgage was paid to her during testator’s life. Held, that there was an evident intention to substitute a present gift of the money for the legacy; that there was a sufficient delivery and acceptance to constitute a gift, and that the title to the mortgage was in the daughter.
    Appeal from judgment dismissing the complaint.
    Action to establish plaintiff’s title to a certain bond and mortgage, which defendant claims to hold as trustee for her benefit under a trust created by the will of the father of the parties.

      John W. Church, for app’lt; James H. Throop, for resp’t.
   Parker, J.

Lester Blackman devised his farm to his son Alonzo Blackman, charged with a legacy of §2,000 to be paid by Alonzo to the testator’s daughter, Frances, who is the plaintiff in this action. Such will further provided that Alonzo should take the legacy of $2,000 as a trustee for the use and benefit of the plaintiff, and pay it to her in his discretion, the trust to continue during her life. Another clause of the will provided that, in case she should die childless, such legacy, or so much thereof as remained in the trustee’s hands, should then pass into the residuum of his estate, which, by the residuary clause of the will, was given to Alonzo absolutely. About a year and.one-half after the execution of such will, the testator purchased from the owner thereof a $2,000 bond and mortgage against ÜSToali Wightman and others, and caused the assignment thereof to be made to his daughter, Frances, and in her name, as the assignee thereof. Prior to making the purchase, he arranged with the mortgagor Wightman that the mortgage should be allowed to stand for a time at four per cent, interest, and then stated to him that he wanted to take it up, and have it run a spell for his daughter, Frances; that his boys had something, and he wanted Frances to have something. Upon the assignment of such mortgage being executed, which was Tfovember 11, 1882, he directed it to be put on record in the county clerk’s office where the mortgage was recorded. Thus the mortgage stood upon the record as apparently the property of the daughter, Frances. At the time of putting it upon record, however, he placed the bond and mortgage, and also the assignment, in the custody of his son Alonzo, to keep them under the trust created by his will, and at the same time he directed that after he was dead his daughter, Frances, was to have the interest. Subsequently the daughter, Frances, at the request of the testator, •executed and delivered to him a writing, of which the following is a copy:

“ Received of Lester Blackman the sum of $2,000 (two thousand dollars), in full of a legacy and bequest to me in his last will and testament of that amount; and, in consideration of the receipt of such money, all claim to such legacy and bequest is hereby released.
“ Frances Blackman.
“ Dated October 18, 1883.”

There can be no doubt but that the $2,000 referred to in this receipt was the bond and mortgage in question, and, inasmuch as there is no evidence to the contrary, it is just to assume that the paper was executed and delivered at the time it bears date. The bond, mortgage and assignment remained constantly in the custody or control of Alonzo Blackman from the time they were placed there, as above stated, to the time of the trial, but a change was made by the testator in regard to paying the interest therefrom to the daughter, Frances. On October 29, 1888, a year’s interest was paid to her, for which she gave her receipt, and annually thereafter, until her father’s death, interest was paid thereon, and receipted for by her. The testator died in January, 1887, and Alonzo was duly appointed, and is acting, as the executor of his will.

The foregoing facts are not disputed by the defendant, and are substantially found by the court at special term. Upon them the question is presented whether the plaintiff does not own, and have absolute title to, the bond and mortgage so purchased by the testator, and which stands upon the record as assigned to her. The defendant contends that such bond and mortgage was never given from the testator to this plaintiff, for the reason that the necessary elements to constitute a gift are wanting ; that there was neither a delivery by the testator, nor an acceptance by the plaintiff. He conceded that the causing it to be assigned to her personally, and directing that such assignment be put on record, would be a sufficient delivery, if it had been done with the intent to vest her with the absolute ownership ; but when it appears that the father’s intent was that she should have such an interest only as was given her by the trust contained in his will, and that his purpose in having it so assigned and recorded was but to provide for carrying out that trust, he claims such acts do not amount to a delivery, and that no absolute gift can be predicated upon them. It may be conceded that upon such a state of facts a gift could not be established, and if we consider only the transaction as it occurred prior to October 18, 1883, it may be that the facts established thereby would not warrant the conclusion that a gift or absolute delivery was intended. But, when we take in connection therewith the transaction attending the receipt of that date, a very clear purpose to vest her with the absolute ownership of such bond and mortgage becomes apparent. By its very terms it appears that the testator had then made up his mind to substitute a present gift of $2,000 for the legacy which he had given her in the will. Evidently, the trust by the will created was to be no longer •operative. That plan was abandoned, and the bounty which she was to receive from her father was given her directly, instead of through the medium of his will. Whatever she then received she took in lieu of “ the legacy and bequest,” and such receipt in the hands of his executor was, by its terms, a complete bar to any claim she might make that the trust be executed for her benefit. 1 Pom. Eq. Jur., § 564; Hine v. Hine, 39 Barb., 507; Langdon v. Astor’s Ex'rs, 16 N. Y., 33. Such being the case, it certainly ought to be considered strong proof that the $2,000 therein referred to had been delivered to and accepted by her as her own property, absolutely. I gather from the case that there is no serious dispute but that the $2,000 referred to in the receipt is the bond and mortgage in question. At least, all the facts in the case point that way, and on the evidence it should be so assumed. The conclusion is therefore irresistible that whatever may have been his intention at the time he took the assignment, and had it recorded, he, at the time he took this receipt, agreed with her that henceforth the bond and mortgage then standing in her name on the record should be deemed absolutely hers, and the receipt given by her should be used as proof that the legacy and trust created for her in the will were satisfied. Ho meaning or intelligent purpose can be given for his taking such receipt other than that, and no evidence was given on the trial tending to give a different explanation. Such an arrangement has in itself all the elements necessary to constitute a valid gift. The thing given being at that time in the absolute control and at the disposal of the donee, the donor recognizes and affirms her control and ownership of it by taking the receipt from her, whereby she surrenders her interest under his will for the property she thus acquires. Such an arrangement amounts to a delivery by him, and an acceptance by her. It is true he might have given the papers over into her possession, and such an act would have been a further evidence of his transfer to her. But the assignment and its record as effectually vested her with the legal title to the mortgage, and deprived him of all control over it, as if he had placed the papers in her hands. His plain recognition of her absolute ownership over it declares his intent as to the effect of recording it as effectually as if he had put the papers into her custody. The donee was given the absolute and full title and control of the bond and mortgage, and nothing more was necessary to complete a valid gift. Matter of Crawford. 113 N. Y., 560; 23 St. Rep., 722.

Considerable stress is laid by the defendant upon the fact that the testator, after the recording of the assignment, told the plaintiff that sire would not have the mortgage unless she had children. It does not appear when this statement was made. I judge from the evidence that it was before the receipt of October 13, 1883,. was taken. If it was before, it had no bearing whatever against the conclusion that a change of purpose was had, and the gift was made in exchange for the receipt. An analysis of the other evidence in the case is not needed. Hone of it is inconsistent with the view above taken, and much of it tends to sustain it, particularly the fact that the defendant procured a discharge of the lien of the legacy upon his farm from the plaintiff, upon the theory that such legacy had been satisfied and redeemed by the testator-in his lifetime. It is sufficient to say that it appears from the written evidence in the case that such satisfaction of the legacy was made, and that the trust under which he claims to hold this mortgage no longer exists. On the whole evidence, there can be no doubt but that this bond and mortgage was the fund with which the legacy was to be satisfied, and therefore the title and ownership thereof at the time of the testator’s death was in this plaintiff. The judgment of the special term was therefore erroneous, and should be reversed.

Judgment reversed on the law and facts, and a new trial ordered, with costs to abide the event.

Hardin, P. J., and Merwin, J., concur.


source: Caselaw Access Project

author: Parker, J.

license: Public Domain

text:
    Luther J. Burditt, Resp’t, v. The New York Central & Hudson River Railroad Co., App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)
    1. Trespass—Illegal use of land for switching—Damages.
    In an action to enjoin a railroad company from maintaining- a swilch on plaintiff’s lands in a highway, where the equitable relief is granted, the loss of the use of the premises up to the time of the trial may be included in the damages allowed.
    2. Same—Evidence.
    In such an action opinions of witnesses as to the effect of the construction of the switch upon plaintiff’s property is. inadmissible, as that is the precise question which the court is to decide.
    Appeal from judgment of special term in favor of plaintiff. The plaintiff owned to the corner of Teall avenue, in the city of Syracuse. The defendant had laid down, and at the time of the commencement of this action was maintaining and operating, a switch upon-and across a portion of the premises of the plaintiff included within said avenue, without the permission of the plaintiff, and without having obtained any right so to do either by agreement or proceedings to condemn. This action is brought to enjoin the defendant from operating such switch upon the premises, and for damages sustained by reason of its having been so used. The court at special term granted the injunction asked for, and fixed the damages sustained at the sum of $151.75. From the judgment entered upon such decision the defendant appeals to this court

      M. M. Waters and Ashbel Green, for app’lt; C. H. Wilson, for resp’t.
   Parker, J.

There seems to be no doubt but that the defendant, in building and maintaining this switch in Teall avenue, has been guilty of a continuing trespass upon the plaintiff’s land, and that the judgment enjoining him from using such switch was properly rendered in this action. Indeed, the appellant makes no complaint before us of any error upon that question. The real question presented is whether the court at special term has imposed too heavy damages against the defendant by fixing the plaintiff’s loss of rents sustained in consequence of the use of the switch from the time it was laid at the sum of $151.75. It is not claimed that in fixing this amount the court adopted any erroneous rule of law, but simply that such amount cannot be sustained by the evidence in the case. An examination of the evidence convinces us that there is no occasion for interfering with the decision of the trial court upon that question. It being an action in equity, and equitable relief having been granted, the loss of the use of the premises up to the time of the trial might very well have been included in the damages allowed, and a larger sum even have been awarded. Barrick v. Schifferdecker, 48 Hun, 356; 16 St. Rep., 449 ; 123 N. Y., 52; 33 St. Rep., 485 ; Henderson v. N. Y. C. R. R. Co., 78 N. Y., 423.

The objection that evidence offered by the defendant was improperly excluded is not well taken. The questions ask for the opinion of the witness as to the effect of the construction of the switch upon the plaintiff’s property. That was the precise question upon which the court was to decide, and such opinion, within the rule laid down in the Roberts case, 128 N. Y., 455; 40 St. Rep., 454, is not proper evidence. See discussion of that question at page 471, 128 N. Y., and 40 St. Rep., 462, of such case. The defendant’s ninth and tenth requests to find assume that only that part of plaintiff’s land over which the switch actually passed, was injuriously affected by it. Such an assumption is not sustained by the evidence, and the requests were for that reason properly denied. On the whole case we think the judgment is correct, and should be affirmed, with costs.

Hardin, P. J., and Merwin, J., concur.


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    In the Matter of the Judicial Settlement of the Accounts of Charles T. Redfield, Adm’r of Anna Maria Redfield, Deceased.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Surrogates—Jurisdiction—Creditor of distributee.
    A surrogate has no jurisdiction (§ 2743 of the Code) to try a claim of a creditor of a distributee to his distributive share under.
    Appeal by Louis Marshall from portion of the decree of the surrogate of Onondaga county which determined that he had no-lien against the distributive share of Lewis H. Redfield, and directed its payment to the respondent, William A. Beach.

      Louis Marshall, for app’lt; H. A. Maynard and William A. Beach, for resp’t.
   Parker, J.

This is an appeal from the decree of the surrogate of the county of Onondaga, made upon the final judicial settlement of the accounts of Charles T. Redfield, as the administrator of the estate of Anna Maria Redfield, deceased. Lewis H. Red-field is one of the children and a next of kin of the deceased, and as such was entitled to a distributive share of her estate. The amount'of such share is fixed by such decree at the sum of $420.83, and the administrator holds such amount ready to pay to whomsoever it belongs. William A. Beach, the respondent on this appeal, appeared before the surrogate on such final settlement and claimed the distributive share of Lewis H. Redfield by virtue of a written assignment thereof from Lewis to his wife, J essie A. Redfield, dated July 13,1888, and acknowledged December 9, 1889, and from Jessie A. Redfield to himself, by written assignment dated November 5, 1890. No contest was made by any party over the genuineness of such assignments, nor of their validity as between the parties thereto. Upon such settlement, Louis Marshall, the appellant herein, also appeared, and claimed such distributive share by virtue of an equitable lien thereon, arising through a mortgage which Lewis H. Redfield and wife had executed to him upon the premises from which the estate about to be distributed had been derived by the enforcement of an annuity, charged thereon for the benefit of the deceased, Anna Maria Redfield, during her life. The surrogate tried the issue thus raised between Marshall and Beach, and determined that Marshall had no lien or claim to such distributive share, and in his decree directed the payment of such share to the claimant Beach. Prom such decision and decree, the claimant Marshall appeals to this court.

On the threshold of this inquiry, the question presents itself whether the surrogate had jurisdiction to try the issue thus raised, or to make any decree whatever on the subject. A surrogate’s court has such jurisdiction only as is conferred upon it by statute, or necessarily implied from the powers so conferred. Matter of Underhill, 117 N. Y., 471; 27 St. Rep., 720. The only statute under which it can be claimed that power was given sufficient to warrant the decree in this case is § 2743 of the Code of Civil Procedure. Such section does not in terms grant any powers, but it imposes upon the surrogate’s court certain duties, and the powers necessáry to fully perform those duties are by implication also conferred. Thus, the surrogate, under such section, has power to construe the provisions of a will so far as it is necessary to determine to whom a legacy belongs, because he is thereby required to distribute by his final decree that portion of the estate remaining after the executor has settled his accounts among “ the creditors, legatees, next of kin, husband or wife of the decedent, or their assigns, * * * according to their respective rights." Matter of verplanck, 91 N. Y., 439. The precise question which the surrogate in this case was called upon to pass on, and which he has, by the decree appealed from, determined, was whether a share of the estate confessedly belonging to one of the distributees should be paid over to him (or his assignee), or to one claiming it as a creditor of such distributee; that is, he was to inquire into the relations existing between a distributee and an alleged creditor of his, and to determine, not only whether the debt claimed actually existed, but whether the creditor had secured an equitable lien upon the share to be distributed. It seems very clear that no such power is conferred upon the surrogate’s court by the section referred to, nor is any duty imposed upon it which requires the exercise of any such power. The final decree is to distribute to “the creditors,” but that means creditors of the deceased only, Matter of Underhill, 117 N. Y., 471; 27 St. Rep., 720; and nowhere is there any provision that a surrogate distribute the estate to persons other than in that section specified. The decree of distribution may order payment to a creditor of the deceased, or to an assignee of such creditor, or to a legatee, or to the next of kin, or to an assignee of either, because each of those is specified in the section; but to a creditor of a creditor, or to the creditor of one of the next of kin, the surrogate is not required to decree payment, and hence there is neither necessity nor authority for his inquiring into the merits of such a claim. I have not been able to find any decision upon this precise question, except one by the surrogate of Westchester county, in líe lieelas, (Duncan v. Guest), 5 Redf., 440, and the facts therein appearing-will illustrate the impropriety of allowing to the surrogate’s court, the jurisdiction which, in the case before us, has been assumed. A husband was entitled to a distributive share of an estate, and he assigned such claim to his wife. Certain persons, claiming to be creditors of the husband, and also claiming that such assignment was in fraud of their debts, had secured an attachment against the distributive share in the hands of the executor, and they applied to be brought into the surrogate’s court upon the final accounting, to the end that they might secure a stay in the payment of the distributive share until their claims could be properly adjudicated upon. The surrogate denied the application, on the ground that they were not proper parties in his court, and decreed the payment to the assignee. This case suggests the extent to which the surrogate’s jurisdiction would be forced, if a creditor of a distributee is entitled for any reason short of an assignment to a decree directing the payment to himself of the share to be distributed. Questions of fraud, and all the complicated and infinite variety of questions that are now the basis for sustaining a creditors’ bill to reach a particular fund, and possibly more attacking the very existence of the debt under which the creditor claims, would be presented to the surrogate, and require an investigation and judicial determination before he could make a decree settling the estate. Several cases akin to this question may be cited as tending to show the views of the courts upon it. In the case of Sanders v Soutter, 126 N. Y., 193, 200 ; 37 St. Rep., 1, a person entitled to a distributive share of an estate had released to the executors all her claim. ‘ It was held that the validity of such release could not be inquired into at the suit of one who claimed to be an assignee of the share released and that such release was in fraud of his rights as such assignee.

Prior to the enactment of § 2743 of the Code the statute did not include the word “ assigns ” in providing to whom distribution should be made, and it was held under such act that a surrogate could not inquire into the validity of, or even recognize the undisputed existence of, an assignment, nor direct payment to be made to an assignee. Hitchcock v. Marshall, 2 Redf., 174; Leviness v. Cassebeer, 3 id., 491. This same section, 2743, also provides that when the validity of a debt, claim or distributive share is not disputed, or has been established, the decree must determine to whom it is payable, etc. Under this provision it has been steadily held that the surrogate cannot try the validity of a debt or claim made against the estate, Matter of Walker, 136 N. Y., 20, 27; 48 St. Rep., 893 ; also, when a legatee aslcs for an accounting against the executor, and he replies that he has been fully released from all claims thereunder by such legatee, the validity of such release, if disputed by the legatee, cannot be tried in the surrogate’s court, Matter of Wagner’s Estate, 119 N. Y., 29, 36 ; 28 St. Rep., 266; also, it has been held that even now, under § 2743, the validity of an assignment of a legacy, as between the legatee and his assignee, cannot be tried in a surrogate’s court, Matter of Cook, 68 Hun, 280; 52 St. Rep., 382 ; Matter of Brown, 3 Civ. Pro.,- 39, 55, although the contrary of this has been held in McCabe's Estate, 18 N. Y. Supp., 715.

The line of reasoning in all these cases is to the effect that a surrogate has no authority except what is expressly conferred by statute, or necessarily implied from the powers conferred, and that such implied powers are not to be stretched beyond what is plainly necessary to enable him to perform the specific duties imposed. So the policy of the statute itself is plainly against giving to such court jurisdiction to adjudicate generally upon the contested righls of litigants. It is prohibited from trying the validity of a debt, even though it is one claimed against the estate itself, and the final settlement of the estate is delayed until the question of its validity is determined. Surely, every conceivable reason for withholding from it jurisdiction to try such claims would apply with greater force against giving it authority .to adjudicate upon the conflicting claims of a distributee and his creditors. We conclude, therefore, that the surrogate has no jurisdiction to try the question which was presented to him by this appellant, and make an adjudication upon it. Nor did the surrogate obtain jurisdiction by assuming it without objection on the part of any of the parties before him. Bevan v. Cooper, 72 N. Y., 318, 329; Matter of Underhill, 117 id., 479; 27 St. Rep., 720; Matter of Walker, 136 N. Y., 21; 48 St. Rep., 893. That being the case, we cannot sustain that part of the decree which adjudges that Louis Marshall has no lien upon, or claim to, the distributive share of Lewis H. Redfield. Upon that question the surrogate was utterly without jurisdiction to make any decision; but, as to all other of its provisions, the surrogate’s decree must be affirmed. Whatever may be the merits of Marshall’s claim to a lien upon the distributive share in controversy, he had no standing in the surrogate’s court to enforce it. Instead of entertaining his objection, and adjudicating upon his rights, the surrogate should have ignored his claim, and proceeded to distribute the estate among those persons specified in § 2743, as their respective rights appeared. Under that section he was authorized to distribute the share of Lewis H. Bedfield to his assignee, no objection being made by the assignor to the validity of such, assignment. That distribution the decree has ordered, and, inasmuch as Marshall had no standing in the surrogate’s court to complain of any decree the surrogate might make with reference thereto, he has no standing to bring this appeal, or to ask that such decree be reversed by this court. Hence we do not consider the merits of the appellant’s claim to a lien upon the fund in question ; nor do we reverse any provision of the decree, except the one that was plainly beyond the jurisdiction of the surrogate to make.

Hardin, P. J., and Merwin, J., concur.


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    Isaac P. Powers, App’lt, v. Hiram Knapp, Resp’t.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    1. Manufacturing companies—Stockholders.
    One who, with others, signs the original certificate for the organization of a corporation under chap. 40, Laws 1848, and subscribes for stock therein, thereby becomes a stockholder and liable as such to the creditors of the corporation under § 10 of the act, and no arrangement made between him and his associates, operating to contradict the written contract, can be invoked to relieve him from its obligations.
    2. Same—Liability—Transfer of stock.
    A stockholder cannot be relieved from such liability by a transfer of his stock, unless such transfer is entered in the transfer book of the company.
    .Appeal from judgment dismissing the complaint, entered upon verdict, and from order denying motion for a new trial on the minutes.
    The action was brought against defendant as a stockholder of the Winslow & Knapp Lumber Company, organized under Laws 1848, chap. 40. Section 10 of that act, and on which the action is based, provides: “ All the stockholders of every company incorporated under this act shall be severally individually liable to the creditors of the company in which they are stockholders, to an amount equal to the amount of stock held by them respectively, for all debts and contracts made by such company, until the whole amount of capital stock fixed and limited by such company shall have been paid in,” etc.

      Hannibal Smith, for app’lt; Watson M. Rogers, for resp’t.
   Parker, J.

In December, 1889, the defendant signed, with Egbert W. Knapp, Korris Winslow, an.d two others, the original certificate of organization of the “ Winslow & Knapp Lumber Company,” in which it was stated that he was one of the trustees of such • corporation. At the same time he signed with the same parties an agreement whereby he agreed to take thirty shares of the capital stock of the Winslow & Knapp Lumber Company, and pay therefor the sum of $100 per share, “when said company is duly organized, and we are called upon for such payment by the trustees of said company.” On the trial of this action, he testified that he understood the paper was for the purpose of organizing a company, but that he. signed it simply to assist the others, who supposed that five persons were necessary to effect the organization, and under the agreement with them that he should put nothing into the company, and take nothing out of it; that it was agreed between himself, Egbert Knapp and Winslow that he was to have no interest in the gconcern, and that as soon as they became incorporated he was to assign back to them anything that was supposed to be his. The certificate was duly filed, and the company entered upon the transaction of its business. Under date of March 11, 1890, two stock certificates, of fifteen "shares each, were filled out upon the book of the corporation, by its secretary, to this defendant, and on the 25th of March they were detached from their stubs in such-book, and laid upon a table in its office; and the defendant was called in, and requested by Egbert-Knapp and Norris Winslow to execute the assignment in blank which was printed on the back of such certificates. The defendant did so, and immediately left the office, leaving the certificates upon the table. Egbert W. Knapp and Norris Winslow thereupon each took one of such certificates, and retained it as his own property. The defendant never paid anything to the company for any stock, nor did he ever ask for any issue of stock to himself, nor was he ever called upon by the company to pay for any, nor was any ever issued to him, except as above stated, and he did not receive anything for executing the assignment on the back of said certificates. No entry of such transfer, in the manner required by the twenty-fifth section of the act, was ever made upon the books of the company. Subsequently, and on October 27, 1890, the defendant attended a meeting of the trustees, and signed a written consent that the company mortgage its property, in which it was stated that he was the owner of thirty shares of the company’s stock. Such was the only meeting of the trustees that he ever attended.

ín March, 1891, the defendant also signed, with others, and swore to, a petition for the voluntary dissolution of the company, in which it was stated that he was one of the trustees, and the owner of thirty shares of, its capital stock, which had been paid for in full. Upon such petition the company was subsequently dissolved by order of court, and a receiver of its property appointed. The defendant testified that he knew resolutions were passed at the meeting of the trustees authorizing a mortgage, but had no recollection of signing the consent. As to the petition, he knew it was an application to dissolve the company, but had no further knowledge of its contents. That he signed the papers because' he was requested to "do, so by Egbert W. Knapp. There was also evidence tending to show that the defendant was a laboring man, ignorant of such business, in the employment of Knapp & Winslow, and easily influenced by them. The plaintiff’s debt was for money loaned the company, and accrued on October 29, 1890. The whole of the capital stock of the company had not been paid in, nor had the certificate required by § 10 of the act of 1848 ever been filed and recorded. Upon these facts the plaintiff claimed at the trial that the court should hold, as matter of law, that the defendant was a stockholder of the company, to the extent of thirty shares of its stock. The court declined to so hold, and left it to the-jury, as a question of fact. The jury found that the defendant was never a stockholder of the company. Such ruling and such finding are claimed to be errors upon this appeal.

The relation of stockholder to a corporation depends entirely upon contract, and, to establish it, it must appear that the minds of the parties met; that the defendant agreed to become a stockholder in the corporation, with the privileges and responsibilities of such relation ; and that the corporation accepted him as such. Glenn v. Garth, 133 N. Y., 31; 44 St. Rep., 80; Mor. Corp. (2d ed.), §§ 24, 46. Section 10, chap. 40, of the Laws of 1848r under which this action is brought, imposes its liabilities only against the stockholders of a corporation; and the plaintiff is therefore required, in order to maintain his action, to establish the fact that the defendant was a stockholder of the corporation at, the time his debt was contracted. This he could only do, within the authorities above cited, by showing that such a contract,, either express or by implication, had at some time been made between the defendant and the corporation. If the only evidence of such a contract was to be found in the fact that the defendant had signed the original certificate of organization, had acted as a trustee of the company, had indorsed over the two certificates of stock made out to him, and had frequently declared himself to be a stockholder, I should say that nevertheless it was a question of fact whether, under all the circumstances, and in the light of his explanations, he had ever actually made a contract with the company by which he had agreed to become the owner of any of its shares of stock. But when we take into consideration the agreement signed by him and the other corporators, whereby he agreed to take and pay for thirty shares of such stock, a very serious question is presented, whether the written and conceded evidence does not contain all the elements of the needed contract. The subscription to take the thirty shares, alone by itself, would not constitute a contract with the company. Dorris v. Sweeney, 64 Barb., 636; Lake Ontario Shore R. R. Co. v. Curtis, 80 N. Y., 219. But it has been held by a general term of this court, in Dorris v. French, 4 Hun, 292, that when such an agreement is consummated, by signing the certificate of organization, it becomes one transaction, and is equivalent to subscribing formal articles of association, and the agreement may be enforced by the company itself. So, in Phoenix Warehousing Co. v. Badger, 67 N. Y., 294, the defendant subscribed the certificate of organization, and placed opposite his name the number of shares taken by him; and it was held that such was a binding subscription for stock, and made him a stockholder in the company. The statute does not require that the number of shares taken by a subscriber should be stated in the certificate, nor does it require that any subscription for stock should have been made at all before filing such certificate. Mor. Corp., § 33. Therefore, if a statement made in such certificate is a sufficient contract with the company, it would seem that a written agreement for thirty shares, made with the same corporators simultaneously with signing the certificate of organization, should be deemed a contract With the company, and as effectual as if made in the certificate itself.

The rule held in Dorris v. French, above cited, is so far sustained by the court of appeals, and on principle we think that such rule is the correct one. The formation of every corporation is based upon a contract between individuals that they will form such an association, and assume the relations of shareholders in it. The act of the legislature is simply to confer upon the individuals so contracting the right to form the corporation, and of acting in a corporate capacity. Therefore, when a numbér of individuals agree among themselves that they will take certain shares in a corporation to be formed, and, at the same time, themselves execute the certificate, and take the steps necessary to acquire the corporate franchise given by the state, each act is but a part of the one contract between them, by which they form the association intended. Mor. Corp., §§ 24, 25. See, also, Buffalo & Jamestown R. R. Co. v. Gifford, 87 N. Y., 294. As applied to this case, such reasoning assumes that the writings express the real transaction between the defendant and the other corporators, but the defendant claims that such is not the fact. From his explanation, it is clear that he understood that he was joining with the others in forming the company, and that he intended to do so; also, that he understood that he was signing an agreement to take and pa.y for thirty shares of its stock. It is quite likely that he did not understand the liability that would attach to him if he became a stockholder; but there was no fraud or deception practiced upon him as to the contents of any paper he was signing, and his ignorance as to the effect of the relations he was voluntarily assuming with the company does not relieve him from the legal responsibilities imposed upon them. As to the rest of his explanation, it is not quite clear whether he means that it was agreed by parol that the writing should not be binding upon him, or that Egbert Knapp and Norris Winslow agreed that they would take upon themselves all the obligations which he assumed, and save him harmless from any liability thereon. The fact that he agreed to assign to them anything that was supposed to be his, as soon as the company was fully organized, seems to indicate that the latter agreement was the understanding which he had of the matter. But whichever way it was is not very material, as we are ■of the opinion that no arrangement that was made between him and his associates, operating to contradict the written contract, can be in-yoked to relieve him from its obligations. In Phoenix Warehousing Co. v. Badger, 6 Hun, 293, the defendant had subscribed in the certificate of organization for 250 shares of stock. When sued on behalf of the company’s creditors for the subscription price thereof he sought to defend on the ground that he had agreed with the other incorporators, at the time he subscribed, that he would be liable for only fifty shares, and that they would take the •other 200 shares. The court held that, as against the creditors of the company, the plain terms of the subscription could not be •contradicted, and that the agreement constituted no defense. That •case practically decides the question presented by this claim, and it is but the application of a very familiar rule—-that the terms of a written contract cannot be, varied or nullified by a contemporaneous parol agreement. Engelhorn v. Reitlinger, 122 N. Y., 76; 33 St. Rep., 275; Thomas v. Scutt, 127 N. Y., 133; 38 St. Rep., 692. See, also, Upton v. Tribilcock, 91 U. S., 45. It •appears, then, from the controlling evidence in the case, that the defendant did make a contract with the company to take and pay for thirty shares of its stock. The fact that he never paid for it does not make him any less a stockholder, nor relieve him from liability as such. His subscription was accepted by the company, stock passed to his name on its books, and he acted as a trustee until the company was dissolved. Here was a contract mutual between the company and himself, and one that a receiver of the company could have enforced against him for the benefit of its creditors. Wheeler v. Millar, 90 N. Y., 353; Buffalo & N. Y. R. R. Co. v. Dudley, 14 N. Y., 336. The question ¿submitted to the jury was therefore not an open one. Upon the facts proven, the court should-have held that the defendant did become a stockholder.

But the defendant claims that, even though the defendant did become a stockholder, it is not disputed but that he assigned his stock before the plaintiff’s debt was incurred, and hence he cannot be held liable under § 10. Section 25 of the act provides that a book shall be kept by the officers of the company, containing the names of the stockholders, etc., and that no transfer of stock shall be valid, etc., unless entered upon such book. It is not claimed that the transfei; by the defendant was entered upon such book, and therefore, by the well-settled law of this state, his assignment was not ■effectual to relieve him from the liabilities imposed by § 10. Shellington v. Howland, 53 N. Y.. 372, 376.

In Johnson v. Underhill, 52 N. Y., 203,209, it is said that both ■the assignor and assignee are liable to creditors until the transfer has been entered on the books. The cases cited by the respondent’s counsel upon this question do not conflict with the above. It has always been held that as between the parties to the transfer, and even as between the parties and the company, an assignment may be valid to transfer a good title without being entered on the books. Chemical Nat. Bank v. Colwell, 132 N. Y., 250; 43 St. Rep., 876; Cutting v. Damerel, 88 N. Y., 410; Isham v. Buckingham, 49 id., 216. But, as against a party who does not stand in the attitude of one subrogated to the rights of the company, but is suing under a statute that creates an original liability, and renders a stockholder liable whether he is a debtor to-the company or not, as does the § 10 in question, no assignment is operative until it has been entered as required by § 25. The company can waive nothing, as against a creditor so suing.

Our conclusion is that the court erred in submitting to the jury the question whether the defendant ever became a stockholder in the company, and that the verdict of the jury on that question is not sustained by the controlling evidence in the case. The judgment and order denying a new trial must be reversed on the law and facts, and a new trial granted, with costs to abide the event.

Hardin, P. J., and Merwin, J., concur.


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    Augustus Hartman, Resp’t, v. The Tully Pipe Line Co., App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Trespass—Damages—Evidence.
    In an action to recover damages to plaintiff’s land by reason of the leakage of salt water from defendant’s pipe in the adjoining highway, which was laid without authority, whereby the shade trees, shrubbery and crops were injured, the measure of damage is the injury sustained up to the time of the commencement of the action, and evidence as to .the value of plaintiff’s premises with and without the pipe line in use is inadmissible.
    Appeal from judgment in favor of plaintiff, entered upon verdict, and from order denying motion for a new trial on thes minutes.

      William G. Tracy, for app’lt; Georye H. Sears, for resp’t.
   Parker, J.

The defendant laid a line of pipe in the highway opposite plaintiff’s lands, through which it forced a stream of saltwater. The plaintiff owned the fee of the land to the middle of the highway, and such pipe was laid underground, and upon his-premises. It had been maintained and used for some two years: before the commencement of this action, and was so laid without permission or right on the defendant’s part. During such two-years it had leaked more or less, and discharged salt water or brine through the earth over plaintiff’s premises, thereby injuring-his shade trees, his shrubbery, and the annual products of his-garden. This action is brought to recover damages for the trespass so committed by the defendant. So far as the questions presented by this appeal are concerned, it is conceded that the defendant is a trespasser; but it is claimed that an erroneous measure of damages was adopted by the trial court, and for-that reason a reversal of the judgment is asked. The plaintiff was allowed to testify, first, as to what was the value of the premises at the time the pipe was laid. After giving that value at four or five thousand dollars, he was asked: “ What are they worth at the time of the commencement of this action ? ” Such question evidently calls for their value with the pipe line as it then was,, and the premises subjected to the constant leakage flowing therefrom. This evidence was allowed, under an objection and exception duly taken by the defendant. Evidently, the court adopted an erroneous measure of damages. It proceeded upon the theory that such pipe line, and the constant leakage resulting therefrom, are to continue forever, and that, therefore, the plaintiff is to recover in this one action the total and permanent depreciation which it caused to the market value of his lands. But such is not the condition of affairs.

Notwithstanding his recovery in this action, he might bring others for injuries subsequently suffered; so he might enjoin the defendant from using such line to his injury ; and therefore it is plain that only such injuries as he had suffered at the time this action was commenced should be allowed in this action. The difference in the value of his premises with and without the pipe line in use upon them gives him much more than that, -and clearly is greatly in excess of what his actual injury is. This question is thoroughly examined and settled in the Uline case, 101 N. Y., 98, and a citation of further authorities is unnecessary. We do not mean to decide that the loss in the rental value of the premises prior to the commencement of this action is the only damage for which the plaintiff can recover in this action. Thus, if the salt water actually destroyed trees, shrubbery, or anything ■else upon the premises, or so injured them that the plaintiff had suffered a permanent loss thereby, he may recover for the loss he had so suffered at the time of the commencement of this action, as well as for the injury sustained by the depreciation in its annual use. But, for the erroneous ruling above referred to, a new trial must be granted. Judgment and order reversed on the •exceptions, and a new trial granted, with costs to abide the event.

Hardin, P. J., and Merwin, J., concur.


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    James W. Eager, Resp’t, v. The Fireman’s Fund Insurance Co., App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Insurance (vibe)—Increase ov hazard.
    Defendant issued a policy of insurance upon a business block, part of which was vacant and part occupied as a hardware store, for the manufacture of a wood filler and for storage. The policy provided that it should be void “if the hazard be increased by any means within the control or knowledge of the insured.” Held, that this provision meant an increase of hazard, by use of the building or otherwise, beyond that existing or contemplated by both parties when the contract was made, and that whether the leasing of the vacant portions for manufacturing purposes really increases the hazard was a question of fact.
    Appeal from judgment in favor of plaintiff, entered upon the report of a referee.

      I. N Ames, for app’lt; Goodelle & Nottingham, for resp’t
   Parker, J.

This action is brought upon a policy of insurance issued by the defendant upon a brick building owned by the plaintiff in the city of Syracuse. It contained the following provision:

“ This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void, if the hazard be increased by any means within the control or knowledge of the insured.”

The defense set up is that such hazard was increased by the act of the insured himself; that is, by leasing a part of the building to> a shoe factory, another part thereof to a paper-box factory, and still another part to a manufactory of electrical implements, all of which was done subsequently to the issuing of the policy, and without the consent óf the company. Upon the trial there was no dispute over the fact- that such subsequent leases had been made, but the contest was over the question whether they increased the hazard. The referee found that the hazard existing when said policy was issued, delivered, and assumed thereby, was not in any manner increased. Upon his report in favor of the plaintiff judgment was entered against the defendant for the full amount of the plaintiff’s claim. From such judgment the defendant has brought this appeal.

The main contention on the part of the appellant is that the evidence does not sustain the above-mentioned finding of the referee, and we are asked to review such finding of fact, and reverse the judgment on that ground. The policy insures a four-story brick building, describing it, and contains no allusion whatever to-the kind of business that was to be carried on within it. The provision, therefore, that the policy shall become void if the hazard be increased, etc., is not entirely a clear one. If it is to be construed entirely from the provisions that are found within itself, the contract could only mean that if any change is made in the thing insured, that is, any alteration of the building which would increase the hazard, the policy should be void. But neither party claims such to be the construction, and it is hardly reasonable to-suppose that such was the intent of the parties to it We have to-look, therefore, outside of the terms of the instrument to determine the meaning of that provision'. At the time the contract was-made, part of the building insured was being used for several different purposes, and it was manifest that the rest of it would also be thereafter occupied by other employments. The building was-built for the purpose of being rented for different employments. That appeared from an inspection of the building, and also the defendant’s agent who made the contract was so informed when he issued the policy. Under such circumstances, the provision in question may fairly be interpreted to mean that if the hazard is-increased, by use of the building or otherwise, beyond that existing or contemplated by both parties when the contract is made, the policy should become void. Whitney v. Black River Ins. Co., 72 N. Y., 118, 122. The defendant claims that the premium charged was for what is known as “ ordinary mercantile risk,” and that such fact is conclusive as to what the parties intended. But there is no evidence showing that the plaintiff, when he-made the contract, knew anything about such a risk, and therefore it cannot be assumed that he contracted with reference to-a particular use of the building, included within that term. At the time of the contract, the plaintiff was using the first floor and the basement for a, wholesale hardware business. A portion of the second story was used for the manufacture of protine, a name given to a kind of wood filler made from wood alcohol and other ingredients. The rest of that floor was used to store furniture. The upper stories were vacant. Assuming the contract to have been as above stated, it is evident that the question before the referee was whether the employments that subsequently came into the building rendered the risk more hazardous than its use for the purposes above stated. On the trial the evidence of most of the defendant’s witnesses was directed to a different question. They were inquired of whether the addition of the shoe factory and a box factory in the building would render it more hazardous than would its use as a hardware store, and they were unanimous that it would. But, upon the question whether such an addition would render it more hazardous than its use at the time the policy was issued, most of them gave no evidence at all. Hence, the great weight of the defendant’s expert evidence was not given upon the real question to be decided. The question whether the hazard was really increased was a clear question of "fact, to be determined by the referee. Wood Eire Ins., § 248; Cornish v. Farm Buildings Fire Ins. Co., 74 N. Y., 295. We cannot say that there was such a preponderance of evidence against his conclusion as will warrant our reversing it. Baird v. Mayor, 96 N. Y., 567; Lowery v. Erskine, 113 id., 52; 21 St. Rep., 917. We have examined the exceptions taken by the defendant, and do not discover any error in the rulings that has worked to its prejudice, or requires that a new trial should be granted. The judgment should be affirmed, with costs.

Hardin, P. J., and Merwin, J., concur.


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    John H. Ehrehart, Resp’t, v. Palmer M. Wood, App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Evidence.
    Evidence as to the making of an entry on an account at or before the time of a settlement between the witness and defendant, for the purpose of discrediting plaintiff’s testimony as to his interview with defendant by showing knowledge at that time of such entry, is properly rejected as immaterial where there is no proof that such settlement took place before such interview.
    Appeal from judgment in favor of plaintiff, entered upon verdict.

      Steele & Prescott, for app’lt; S. M. Lindsley, for resp’t.
   Parker, J.

This action is brought to recover a balance due for coal sold and delivered by the plaintiff to the defendant. The answer sets up two defenses. First, that the parties had settled and agreed upon the balance, and that the same had been paid before the commencement of this action ; second, that the plaintiff had broken the contract under which the coal was purchased, and the defendant had suffered damages thereby to an amount exceeding the plaintiff’s claim. These questions of fact were submitted to the jury, and it found a verdict for the plaintiff for the full amount claimed by him. From the judgment entered upon such verdict this appeal is brought.

After a careful examination of the evidence, we are not disposed to disturb this verdict. The questions were very fully and fairly submitted to the jury, and there is not such a preponderance of evidence in favor of the defendant as warrants us in setting the verdict aside on that account. Baird v. Mayor, 96 N. Y., 567; Roosa v. Smith, 17 Hun, 138; Fleming v. Smith, 44 Barb., 554; King v. N. Y., L. E. & W. R. R. Co., 50 St. Rep., 103 ; Beckwith v. N. Y. C. R. R. Co., 64 Barb., 300,308. Nov do we'find any error in the reception or rejection of evidence that warrants the granting of a new trial. The ruling most urgently complained of is the exclusion of the evidence offered by the witness Churchill, as to whether the entry he made on Exhibit 13 was made at or before he settled with the defendant. The argument is that, if it appeared by his evidence that such entry was on the exhibit when the plaintiff and defendant bad their interview, it would discredit the plaintiff’s version of that transaction. So it would, if it had appeared that the witness’ settlement with defendant was before the date of the interview between plaintiff and defendant. But it nowhere appears that the witness and Wood had settled before the time when the plaintiff and Wood had such interview, and therefore the evidence offered appeared to be utterly immaterial. It was not equivalent" to an offer to show that the indorsement was on the bill at the time of the interview between the plaintiff and the defendant. Hence there was no error in rejecting it. None of the other rulings complained of appear to be erroneous. We conclude, therefore, that the judgment and order appealed from should be affirmed, with costs.

Merwin, J., concurs; Hardin, P. J., not voting.


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    John P. Harvey, Resp’t, v. Ephraim G. Van Cott, Ex’r, and Estelle R. Wright, App’lts.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    1. Insurance (life)—Policy in favor of wife—Disposal by will.
    A policy on the life of a husband in favor of his wife or children passes by the residuary clause of the will of the wife who dies childless leaving the husband surviving, and is subject to the disposition of her executors.
    3. Same—Transfer by executors.
    To confer a good title to the policy to a purchaser from the executor who takes without notice of any fraud, it is not necessary that the executor assumed to sell it in his representative capacity.
    •3. Same—Consent of husband.
    The written consent of the husband is not necessary to authorize the . executors of the wife to assign it,
    4. Evidence—Admission of improper, when harmless error.
    When there is sufficient other evidence to establish a fact, and none to . disprove it, the admission of improper evidence of the fact is not a ground for granting a new trial.
    (Merwin, J., dissents.)
    Appeal from judgment in favor of plaintiff, entered on report of referee.

      E. J. & W. D. Ball, for app’lt, Van Cott; S. W. Petrie (Charles E. Patterson, of counsel), for app’lt Wright; C. J. Palmer, for resp’t.
   Parker, J.

At the time of her death, Mrs. Mary Yan Cott held a policy of insurance for §2,000 upon the life of her husband Edward B. Yan Cott, payable to her, or her legal representatives, upon his death, or if she be not then living, payable to her children, or their guardian, if under age. She died without children, and leaving her husband surviving her. She left a will, by which she gave certain portions of her “productive personal property ” to her husband for life, and npon his death to her niece, now the defendant Mrs. Wright. “All the rest, residue, and remainder of my estate,” by a residuary clause in her will, she gave to her said niece, and appointed such niece and her husband the executors of such will. The husband sold and delivered such policy to the plaintiff, for a certain sum of money paid him, and for a monument which the plaintiff made and erected upon the ^ot where the wife was" buried. The plaintiff also paid the premiums upon such policy until the death of the husband. Subsequently the husband died, leaving a will in which he appointed the defendant Ephraim Gr. Yan Cott his executor. The plaintiff thereupon demanded from the insurance company the amount of such policy, claiming that he acquired the title thereto under his contract with the husband. Mrs. Wright claimed it as a legatee under Mrs. Yan Cott’s will, or else as surviving executor of such will. Ephraim Yan Cott claimed it as executor of the deceased husband’s estate. The company paid the amount of the policy into court, and this action is now prosecuted to determine to whom, under the circumstances, such policy belonged. The referee found in favor of the plaintiff, and from his judgment both the other claimants appeal.

. In order to determine the question presented on this appeal, we must ascertain the character of the property or interest which Mrs. Yan Cott had in this policy at the time of her death. Prior to 1873, the property which a married woman had in such a policy was a peculiar and limited one. She could not dispose of it in any manner. Eadie v. Slimmon, 26 N. Y., 9 ; Frank v. Mutual Life Ins. Co., 102 id., 266; 1 St. Rep., 681; Brick v. Campbell, 122 N. Y., 337; 33 St. Rep., 520. Her creditors could not reach it. They had no claim whatever upon it Smillie v. Quinn, 90 N. Y., 492; Baron v. Brummer, 100 id., 372. It was, therefore, unlike an ordinary chose in action, to the extent that it was considered as created and appropriated for a specific purpose. By chapter 821 of the Laws of 1873 the prohibition against her disposing of the property was, to a certain extent, removed, and in the event that she had no child, or descendant of a child, she is allowed to dispose of the policy before the death of her husband by a last will and testament, or by a deed duly executed and acknowledged in the manner required to pass her dower right in lands. In the case before us, Mrs. Yan Cott has not, in terms, made any specific bequest of the policy in question. She has not specifically mentioned it as a part of the property bequeathed, but, after giving certain property to her husband, she gives “all the rest, residue and remainder of my estate, of every name and nature,” to her. niece, now the defendant Mrs. Wright. At that time she held and owned the policy, and, being-childless, she had, by force of the statute of 1873, the clear legal right to dispose of it by her will. She does not in any-way except it from the operation of her will (the language of the residuary clause is ample to include it), and we must, therefore, infer that she intended it to pass by such will.

The defendant Mrs. Wright, however, claims that it not only passed by the will, but that she took it in specie, and freed from all claim or control on the part of the executors. Evidently, Mrs. Yan Oott had no such purpose, as she does not attempt to separate the policy from the rest of her assets. She does not mention it as an article especially bequeathed, but she disposes of it, if at all, with the bulk of her estate, and in terms that vest the title in the executors, giving to the residuary legatees only the proceeds remaining ‘¿after the estate is fully administered upon. Pom. Eq. Jur., § 1132. If Mrs. Wright takes it in specie, therefore, she does so by reason of the peculiar character of the property bequeathed. That raises the question whether, notwithstanding the statute of 1873, authorizing her to dispose of it, this policy was- . still such a peculiar kind of property as prevented it from passing, as other assets of her estate would pass, to the executor of the will. The peculiar character of such policies in the hands of a married woman was impressed upon them by the courts on the theory that the statutes authorizing them “looked to a provision for a state of widowhood and orphanage, and that it would be a violation of the spirit of the provision to hold that a wife insured under that act could sell or traffic with her policy as though it were realized personal property, or an ordinary security for money.” Barry v. Equitable Life Assur. Co., 59 N. Y., 593. But in the absence of children, and upon the death of the wife before the husband, both of the reasons upon which that theory is based are removed, and doubtless it was upon that consideration that the act of 1873 authorized the disposition of such a policy by will. At all events when a wife who is childless dies before her husband, their being neither orphanage nor widowhood to be provided for, all reasons for longer impressing upon such property the peculiar characteristics above mentioned have ceased ; and there is neither necessity ' for, nor propriety in, continuing upon such property, in the hands-of a person to whom it is thus lawfully transferred, any different characteristics than attach to an ordinary chose in action.

This conclusion is somewhat confirmed by a decision of the court of appeals in Olmsted v. Keyes, 85 N. Y., 593, where it is held that upon the death of the wife, intestate, such a policy vests in the husband, as survivor. If it was a chose in action such as the husband could claim “jure mariti" when his wife died without disposing of it, all the more would it seem to be such an ordinary asset as an- executor could claim under the residuary clause of a wife’s will. See, also, a reference to. such, case in- Whitehead v. N. Y. Life Ins. Co., 102 N. Y., 152; 1 St. Rep., 344; Walsh v. Mutual Life Ins. Co., 133 N. Y., 408, 419 ; 45 St. Rep., 123. We conclude, therefore, that the policy in question was lawfully transferred by Mrs. Yan Cott by the residuary clause of her will, and., being so transferred, it became subjected to the liabilities which usually control the assets of an estate so bequeathed. Such being the case, her husband, as one of her executors, had power to give the plaintiff a perfect title to it. “ The executor is the owner of the personal property of the testator. The absolute title vests in him, and he possesses tliejMs disponendi in its full force. The honest purchaser is under no duty to see that the moneys are faithfully applied by the executor.” Leitch v. Wells, 48 N. Y., 585, 595. One of two executors possesses the power of selling the personal assets as fully as if botli were to join in the act of transfer. Bogert v. Hertell, 4 Hill, 492, 503 ; Wilder v. Ranney, 95 N. Y., 7; Barry v. Lambert, 98 id., 300, 308. The purchase of a monument for the deceased was not inconsistent with the proper use of her assets by her executor. Laird v. Arnold, 42 Hun, 136; 3 St. Rep., 376. Therefore, there is no fact appearing that discredits the good faith of the plaintiff in dealing with the executor for the purchase of the policy. It is said that the husband did not assume to sell it as executor. True, there was some doubt expressed as to whom it belonged, but we cannot say that the plaintiff did not rely upon his authority as executor to give good title to the policy. The title to the policy was believed to be in him, either as executor or as owner in his own right, and in either event a sale and delivery by him would give good title to it, so long as there was nothing to notify the purchaser that the sale was being made in fraud of the estate. The consideration that was paid for the policy could be applied to either the estate or to the husband personally, as their respective rights on a final settlement of his accounts would require, and therefore nothing showed the plaintiff that the husband was acting in fraud of his trust.

It is claimed, however, that the policy could not be transferred by Mrs. Yan Cott’s executors without the written consent of the* husband, and, as no such writing was given, the plaintiff acquired no title, and Mrs. Wright, as surviving executor, has lawful right to the policy or its proceeds. This claim requires us to consider the effect of chapter 248 of the Laws of 1879 upon the operation of the act of 1873. As we have seen, the act of 1873 conferred upon a wife the power to assign her policy, or bequeath it, when she had no children, on complying with certain formalities in the manner of transferring it. The act of 1879 conferred upon her full power to assign it in any manner, even though she had children, provided her husband consented in writing to the transfer. The statutes are not inconsistent. Full effect can be given to the last one without repealing or limiting the effect of the prior one. A married woman may still, without the consent of her husband, bequeath her property, provided she has no children. If she has children,.she is not aided by the act of 1873, and cam only dispose of it by bringing herself within the provisions of the act of 1879. The latter act, therefore, was passed for the benefit of those wives who had children, and was intended to extend, rather than limit, the power of married women to dispose of such policies. Certainly, if it was not intended to prohibit a married woman, .who had no children, from bequeathing her policy without the consent of her husband, it surely should not be construed as limiting the right of one to whom she bad thus lawfully bequeathed it. It is true that the statute of 1879 provides that, in case of her death, it may be disposed of “by her legal representative, with the written consent of her husband,” but such provision is given its full meaning if it be held to apply to those cases when the wife has died without ■ in any manner disposing of the policy. It seems very clear that the act of 1879 was not intended to repeal or limit the power of disposition given to married women by the act of 1873. Assuming that, it would be a forced and unreasonable construction to hold that under the provisions of the later act the person to whom it is thus lawfully assigned cannot himself transfer it without the written consent of the husband.

The statute of 1873 expressly provides that the person to whom the policy is so transferred, under the provisions of that act, shall acquire the same rights in respect thereto as such married woman would have had in case she survived her husband, and we hold that this provision is not repealed or modified by any provision in the act of 1879. It follows, therefore, that the executors of Mrs. Yan Cott's will took title to the policy in question, and the absolute right of disposing of it, unaffected by any provision of the act of 1879, and that no written consent of the husband was necessary to authorize them, or either of them, to assign it. This leads us to the conclusion that the plaintiff acquired a good title to the policy in question, and that the judgment in his favor should be affirmed, unless there was some error committed on the trial, in the admission of evidence, that requires us to order a new trial.

The error complained of is that several persons were allowed to testify that the executor Edward B. Yan Cott, at various times after the alleged sale of the policy to the plaintiff, told them that he had so assigned it, and the consideration which he received for it. The view which we have taken above entirely excludes his executor, Ephraim Gr. Yan Cott, from any interest in the policy, and hence the receipt of such evidence was quite unimportant as to him. But the defendant, Mrs. Wright, asa surviving executor, had the right to challenge the fact of the transfer of this policy to the plaintiff.

In this capacity, she was acting for the estate, seeking to recover against the plaintiff assets which she claimed belonged to the estate. Therefore, she had the right to except to any evidence tending to prove such transfer that was not legally admissible as against the estate. The evidence complained of tended to prove the transfer by the declaration of her co-executor as to what he had done regarding such transfer. They were not made by him while acting in th¿ discharge of his duties, and were in no sense part of the res gestes. They were, therefore, not admissible, as against the estate, Church v. Howard, 79 N. Y., 415; Davis v. Gallagher, 124 id., 487 ; 36 St. Rep., 461, unless the fact that the executor is since dead takes them from the general rule. It may be that such fact rendered the evidence admissible, within the rule given in Schenck v. Warner, 37 Barb., 262, Steph. Dig. Ev., arts. 25, 28, and Livingston v. Arnoux, 56 N. Y., 507, but we prefer to put our decision upon the ground that the admission of such evidence worked the defendant Wright no harm. If all the declarations improperly admitted were stricken out, there is still abundant evidence in the case to show that the plaintiff procured the policy in the manner in which he claims’ he did, and there is not a particle of evidence in the case to dispute it. There is really no conflict over that question, and for that reason we conclude that the admission of such declarations is not a ground for granting a new trial. Matter of Eysaman, 113 N. Y., 70, 71; 22 St. Rep., 136. The same considerations apply to the exceptions taken to the admissions made by Mrs. Wright, so far as any of such rulings were erroneous. On the whole case, we conclude that the judgment appealed from must be affirmed.

Judgment affirmed, with costs.

Hardin, P. J., concurs; Merwin, J., dissents.


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    Denny Carleton, Resp’t, v. Charles M. Packard, Impl’d, App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)
    Appeal—Refebence—Weight of evidence.
    In an action upon a mortgage which had been deposited in escrow the-defense was that it wasto be delivered on the production of certain notes- and a deed and a bond to indemnify defendant against future support of his wife, and that the same had been delivered without such bond having-been given. Defendant and a witness testified that such bond was to be given, which was contradicted by plaintiff and the depositary. Ño bond1 was drawn at the time of the transaction, although all the other requisite papers were, and subsequently defendant wrote to the depositary that his-lawyer understood that there was to be a bond, but he would take the chances, and directed him to go on without the bond. Held, that a finding by the referee that there was no -such condition would not be disturbed.
    Appeal from judgment in favor of plaintiff, entered on the report of a referee.

      Alex. & A. W. Cumming, for app’lt; Jerome De Witt, for resp’t.
   Parker, J.

This action is brought to foreclose a mortgage executed by the defendants to the plaintiff. The defendant, Charles M. Packard, alone answers. The only defense which was litigated upon the trial is to the effect that the note, and mortgage given to secure it, were put into the hands of a third person, to be delivered to the plaintiff when he should produce and surrender three certain notes outstanding against the defendant; also a quitclaim deed from the defendant’s wife to himself, duly executed and acknowledged by her, and a receipt that she had received from the plaintiff the sum of $1,060, and a bond executed by the plaintiff to indemnify the defendant against the future support and acts of his wife. The person so intrusted with the .mortgage received from the plaintiff all of such articles except the bond, and delivered the note and mortgage to the plaintiff. The controversy between the parties is whether there was any agreement that plaintiff should give such bond or any conditoin that the note and mortgage should not be delivered to the plaintiff until such bond was given. Such question is purely one of fact, and the referee before whom the case was tried has found that there was no such agreement or condition.. The question presented to the court is whether it should reverse that finding.

A careful examination of the evidence shows a very decided conflict upon that question, and we are by no means able to say that there is such a strong preponderance in favor of the defendant as would warrant us in interfering with the referee’s conclusions. There is very much in the evidence to indicate that all the defendant Packard required was an agreement from his wife not to come upon him for support in the future. It looks as if at the time he put the mortgage into Talcott’s hands he did not understand the full necessity for a bond from the plaintiff, nor appreciate the remarks his attorneys made on that subject. Although he swears that he instructed Talcott not to deliver the mortgage until the plaintiff executed and delivered a bond of indemnity in exchange, and although Bloomer testified that he understood such a bond was to be given, the evidence is squarely contradicted by both the plaintiff and Talcott, and the latter seems to have been very careful to take a memorandum of his instructions. It is also a significant fact that, although all the papers necessary to carry out the agreement were drawn up by Packard or his attorney, no such bond was prepared. If the plaintiff was to execute such a bond, •one would naturally expect that it would have been prepared and •executed in this state, where it was to be used, and also where it could be inspected by Packard, rather than be left to be drawn and executed in a foreign state, and accepted by Talcott without ■opportunity for Packard to approve it. But most significant of all is the letter written by the defendant to Talcott, and evidently sent soon after he left Binghamton. In that the defendant says his lawyer understood the plaintiff was to give a bond. He does not claim that he himself so understood, and had provided for it. He further says that, rather than discuss the matter any more, he would take the chances of his wife’s ever returning upon him; clearly indicating that he did not understand that a bond was already provided for, and no further discussion was necessary. The letter also substantially directs Talcott to go on without a bond, and only take care that he had three witnesses to the mental ability of his wife to execute the paper prepared for her. In view of such facts, clearly the finding of the referee should not be disturbed by this court. Baird v. Mayor, 96 N. Y., 567. We have also examined the rulings of which the appellant complains, and do not find in them any error for which a new trial should be granted. The defendant, therefore, has not shown any defense against the mortgage. It was given upon an abundant considera-: tion, to wit, to pay his debts, and to furnish a fund for the support of his wife. That fund the plaintiff seems to have fully advanced, and to have in all respects performed the conditions upon which he was to receive the mortgage from Talcott. The judgment. therefore, is correct, and should be affirmed, with costs.

Hardin", P. J., and Merwin", J., concur.


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    Theresa Scherff, App’lt, v. Theodore Jacobi et al., Resp'ts.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Evidence—"Writing may be shown not to be the contract between THE PARTIES.
    In an action on a verbal loan of money to be returned with interest, to which a denial and counterclaim "were set up in defense, the plaintiff, to fix the date of the loan, referred to a receipt for the money, which contained a statement that it was to be returned with interest “when convenient.” Defendants immediately put the receipt in evidence. Held, that it was error to exclude evidence to show that the writing was not the contract actually made, but had been imposed upon plaintiff by fraud and retained by her in ignorance of its contents, as she was unable to read.
    Appeal from judgment dismissing the complaint, entered on verdict directed by the court.

      Jenney & Marshall, for app’lt; Stephen Lockwood, for resp’ts.
   Parker, J.

The plaintiff’s complaint in this action charges that on or about October 25, 1886, she loaned to the defendants $200, which they agreed to repay with interest, and she asks judgment against them for that amount. The defendant Catherine, who is the wife of the defendant Theodore Jacobi, answers separately, and denies that she made any such loan. She further avers that the defendant Theodore furnished to the plaintiff board, use of rooms and fuel, of the value of $528, in full accord and satisfaction of her claim for such $200. The defendant Theodore denies the loan, alleging that the money was a gift from the plaintiff to himself, and also sets up as a counterclaim the board, use of rooms and fuel furnished by him to the plaintiff, to the extent of $528. On the trial, while the plaintiff was being examined, it appeared that, at the time she made the alleged loan, she received from the defendant Theodore a writing, of which the following is a copy.

“ Syracuse, N. Y., October 25, 1886.

“ Received of Thrasa Scherff the sum of two hundred dollars. When Convenca I promas to pay the Sum of Two Hundred Dollars with six cent intrestest up to dat to Thrasa Scherff.

“ Theodore Jacobi.

“ Catherena Jacobi.”

The plaintiff had retained such paper, and" referred to it on the trial to fix the date of the loan. As soon as it appeared, the defendants put it in evidence, while the plaintiff was being examined, and thereupon claimed that such writing was conclusive evidence of the contract under which the defendants had received the money, and that, it being an agreement to repay at the defendants’ convenience, the plaintiff would have to show a present ability to pay in order to recover under it. The court so held) and also held that such ability to pay could not be shown under the plaintiff’s complaint. In response to this claim, the plaintiff offered to show that such paper did not express the contract between-the parties ; that the plaintiff could not read or write; that she did not know the contents of the paper, and was deceived in taking it; and that it was never delivered to and accepted by her as the contract upon which the loan was made; and she asked leave to go to the jury upon that question. The court rejected such evidence, on the ground that it was not admissible under the complaint, and also denied the plaintiff’s motion to amend the complaint. The complaint was thereupon dismissed by the court, and from the judgment entered thereon this appeal has been taken.

Although the plaintiff received and retained the paper, it was not necessarily the contract between them. It is in the form of a receipt, not signed by the plaintiff, and, although it has incorporated in it terms as to the repayment of the amount received, it may be that, knowing she could not read it, the defendants inserted such terms fraudulently, aud induced her to receive it as a mere receipt It does not- require the citation of authorities to show that the receipt and retention of the paper by the plaintiff under such circumstances would not make it conclusive as to her, nor prevent her from showing what the real contract was between them. Such were the facts which the plaintiff offered to prove, and, if proven, it would have left her case standing upon precisely such a cause of action as is set forth in her complaint. The confusion seems to have arisen from allowing the defendants to prove an affirmative defense before the plaintiff had proved her case, and then prohibiting the plaintiff from rebutting it.

The logic of the situation was this : The plaintiff claimed on a verbal loan of money to be repaid with interest, but no time for repayment specified, and she testified to such contract. The defendants, admitting the loan, claimed that the money was to be repaid at their convenience, and that a contract to that effect was reduced to writing at the time. They were allowed tp prove such defense by putting in evidence the writing, and assuming, from the fact that it was still in the plaintiff’s possession, that it was delivered and received as expressing the contract between them. To this defense the plaintiff sought to reply that the writing was not the contract actually made ; that it had been imposed upon the plaintiff in fraud, and retained by her in ignorance of its contents; and that really the loan was made upon the terms set forth in the complaint. The court excluded such evidence because the plaintiff had not anticipated such defense, and set up her reply to it in her complaint. This, we think, was an error for which the judgment should be reversed. It was plainly a question for the jury whether the paper embodied the contract made, or was received and retained under the circumstances claimed by the plaintiff. Inasmuch as her cause of action under that claim was precisely the one set forth in her complaint, she should have been allowed to prove it. The complaint need not anticipate and deny a possible defense. Wheeler v. Millar, 90 N. Y., 354, 361. The judgment entered should be reversed, and a new trial granted, with costs to abide the event.

Judgment reversed, and a new trial ordered, with costs to abide-the event.

Hardih, P. J., and Merwik, J., concur.


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    Theodore D. Fowler, Resp’t, v. John E. Van Natta, App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Contbact—Weight of evidence.
    In' an action for services plaintiff testified that no agreement as to wages, was made. Defendant’s witness who made the arrangement testified that plaintiff was to receive the same as the person whose place he took, and there was evidence of plaintiff’s admissions to the same effect; but it appeared that the services rendered by plaintiff were more responsible than; those of his predecessor, and worth considerably more. Held, that the. decision of the referee in plaintiff’s favor would not be disturbed by an appellate court as against the weight of evidence.
    Appeal from judgment in favor of plaintiff, entered on the report of a referee.

      Frank M. Leary (M. N. Tompkins, of counsel), for app’lt; Charles H. Everts, for resp’t.
   Parker, J.

This action is brought to recover for services rendered by the plaintiff for the defendant from April 1, 1885, to-the 1st day of April, 1888. The defendant was the owner of a. summer resort on Cayuga lake, and the plaintiff lived upon the premises, and cared for the same, during the winters, and rendered services in various capacities during summers, when the place-was open for business. The plaintiff claims that he went there and rendered the services at the request of the defendant, but that no price was ever agreed upon between them as to what he should be paid. The defendant concedes that the services were rendered at his request, but claims that they were rendered at a price agreed upon between them at the time the hiring commenced, and that such price has been fully paid. - The action was tried before a referee, who found for the plaintiff to the full amount of his claim, and from the judgment entered on the report the defendant brings this appeal.

The main question presented to us is whether the evidence sustains the referee’s finding that no agreement for price was ever made between the parties, and that, therefore, the plaintiff was entitled to recover what the services rendered were fairly worth. Snch question is purely one of fact. There is a decided conflict in the direct evidence upon it. Mack testifies that he made the bargain for the defendant with the plaintiff, and that his wages were to be the same as Dann’s, whose place lie took, yet plaintiff as positively denies that anything was said by Mack about wages. It may be that the fact that Mack was apparently disinterested,, and that the evidence of one or two other witnesses as to the-plaintiff’s admissions make what appears on paper to give the weight of evidence to the defendant, yet, if we had heard the witnesses, and had an opportunity to judge of the credit to be given to each by seeing them on the witness stand, we might very easily see why the referee has given credit to the plaintiff, rather than to Mack. The talk with Mack was in the fall of 1884, and may well be claimed to have been for no longer than the following spring. The services rendered as superintendent were much more responsible than those rendered by Dann, and, the evidence shows, were worth considerably more. Upon all the evidence, we cannot say that it is a case where, within the rules laid down by the decisions, an appellate court should interfere with the conclusions of the referee. Westerlo v. De Witt, 36 N. Y., 340, 345 ; Baird v. Mayor, 96 id., 567 ; Devlin v. Greenwich Sav’gs Bank,125 id., 756 ; 35 St. Rep., 922; Beckwith v. N. Y. C. R. R. Co., 64 Barb., 308; Roosa v. Smith, 17 Hun, 138; Thompson v. Vroman, 49 St. Rep., 537. Nor do we think there was any error in the refusal of the referee to find the facts requested by the defendant, or in his rulings upon the admission of evidence, that warrants the granting of a new trial.

As to the request concerning the oats, the evidence does not warrant the conclusion that the plaintiff mixed them with his own with the fraudulent purpose of using them, or that he fed them to his horses, in fraud of the defendant. As to the baskets, if he did take them when he left the defendant’s employment, we do not think it would be such an act as would bar his action for the recovery of wages due him. It was an act done after his employment ceased. As to the evidence admitted under defendant’s objection, it seems to be so utterly immaterial that no possible effect could have been given it prejudicial to the defendant’s case. We conclude, therefore, that the judgment must be affirmed, with costs.

Hardin, P. J., and Merwin, J., concur.


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    Michael McCormick, Adm’r, App’lt, v. James Sullivan, Resp’t.

      (Supreme Court, General Term, Fourth Department,

      Filed September 23, 1893.)

    Principal and surety—Lien.
    Defendant indorsed a note of plaintiff’s intestate to enable the latter to raise money. Intestate promised the lender that he would give a mortgage to take up the note, and received from him a certificate of deposit, which he gave to defendant to cash, and out of the proceeds instructed defendant to pay a debt of his and return the balance, and died the same day without having given the mortgage. Defendant made the payment, but refused to pay over the balance to plaintiff. Held, that in collecting the certificate of deposit defendant acted as the agent of the intestate and had no other rights than an ordinary agent would have had; that he had no lien on the balance to secure the performance of intestate’s promise, nor any counterclaim against the demand, as the note was not due and the estate not shown to be insolvent.
    Appeal from judgment dismissing the complaint on the merits, ■with costs against the estate of plaintiff’s intestate.

      F. M. Leary (M. N. Tompkins, of counsel), for app’lt; David M. Dean, for resp’t. i

   Parker, J.

The defendant received from the plaintiff’s intestate a certificate of deposit on the Tompkins County Bank for $500, ■with instructions to collect that amount, to pay to one Brice $107.50 thereof, and return the balance to him: The defendant collected from the bank the whole amount, and paid to Brice as directed. The intestate died on the very day the defendant received the money from the bank, and this plaintiff, as his administrator, after demanding the balance of such money from the defendant, and being refused, brings this action for its recovery. Upon the trial the following facts appeared: First, it was conceded that, a day or so before he received the certificate from the deceased, the defendant had indorsed a note as surety for him, to enable him to borrow $500 from Mr. Black, and that Black had, in consideration of such note, indorsed over to the intestate the certificate in question. Such certificate was for $600, and Black had indorsed on it a direction to the bank to pay the intestate $500, and place $100 thereof to the credit of Black. Next it appeared that, prior to the giving of the note in question, there was an agreement between Black and McManus, the intestate, made for the benefit of the defendant in this action, by which McManus was to obtain a release of certain of his property from the lien of a mortgage that was then upon it, and then execute a mortgage to Black, and release the defendant, and give up the note. This last statement was determined by the jury to be the fact in reply to a specific question left to them to be answered as a special verdict. It was also conceded that the intestate died without having given any mortgage to Black. Aitother question was submitted to the jury, as follows:

“At the time the certificate of deposit was delivered to Mr. .Sullivan to bring to Ithaca to get the money on, was it then ■agreed between McManus and Mr. Sullivan that a mortgage -should be given upon a portion of McManus’ farm, to secure a note Mr. Sullivan had previously signed for Mr. McManus, to ■obtain that certificate of deposit ? ”

The jury answered, “No," to this question, and we must therefore assume that no such agreement was made with the defendant when he took the certificate. To this must be added another fact, "testified to by the defendant himself, that when he took the certificate the understanding was that he was not going to keep it. Nothing was said, when he took the certificate to get the money •on, that he was going to keep it or hold it until the mortgage was given, and he did not intend to so keep it or hold it. Such were the facts, and the only facts, appearing to the court, and ■upon them a judgment was directed dismissing the plaintiff’s complaint on the merits. From that judgment this appeal is taken.

The first question to be considered is whether, from these facts, •any defense appears to have been shown against the plaintiff’s •claim. It is important to notice that the transaction in which the loan was made, and the defendant’s liability as a surety incurred, was completed a day or two before he took the certificate of deposit to get the money on. There is no claim made that the certificate, or the money t'o be received upon it, was to be held or in any way applied as a security to the defendant for indorsing the note. There was not, in any form, or between any of the parties,, any arrangement that such certificate, or the proceeds of the loan,, were to be held by any one as security that the promised mortgage would be given. Nor is there anything to indicate that the-parties understood that the contract by which the loan was made-by Black, and the liability as surety incurred by the defendant, was not completely finished when the intestate delivered the note to Black with the defendant’s indorsement thereon, and received from Black the certificate in exchange therefor. The defendant himself testified that, when he received the certificate from the-intestate to go and get the money on it, he had no intention of keeping it until the mortgage was given or as security for any purpose. He was at once to return the money he had received upon it to the intestate. It is plain, therefore, that the only security which the defendant had for becoming surety on the note, or which was contemplated from the time the arrangement began-until it was fully completed, was the mere naked promise of the intestate made to Black that some time in the future he would take up the note, and substitute a mortgage in its place. Under such circumstances, I am not aware of any rule, legal or equitable, nor am I referred to any by the defendant’s counsel, that gives the defendant a lien upqn the proceeds of that note, or authorizes him to follow it into the custody of the intestate as a security for the performance of such promise.

The evidence does not present a case where the transaction is incomplete, and something remains to be done bjr the principal before the surety’s obligation is to be assumed. The obligations of the borrower, the lender, and the surety had all been fully incurred and the transaction closed up before the certificate came into the possession of the defendant. It may be conceded that the promise made by the intestate to Black was made for the defendant’s benefit, and also that, in equity and justice, it ought to-be performed; yet I am at loss to discover any principle that gives the defendant a specific lien or claim upon the proceeds of that note. It seems, therefore, that when the defendant undertook to take that certificate to the bank, get the money on it, and-return such money to the intestate, he was acting merely as an agent for the intestate, and had no other rights in the fund he was-receiving than an ordinary agent would have liad. Authorities need not be cited to show that under such circumstances, upon the death of the intestate, he was obliged to account for and pay over the proceeds to his administrator. These considerations seem to dispose of the whole case, as defendant has not pleaded any counterclaim to the indebtedness so existing against him ;• but aside from the question of pleading, the facts do not show any demand due him which he could utilize as a counterclaim in this; action. Clearly, no cause of action had accrued to him by reason of his having indorsed the note as surety for the intestate, because as yet the note had not become due, and he had never been-compelled to pay anything on account of it. Frost v. Carter, 1 Johns. Cas., 74. Nor did he have a cause of action against the intestate because of his omission to give the mortgage promised to Black. Such promise, in legal effect, was little more than the promise ordinarily implied in every case between principal and surety, to wit, that the principal will indemnify the surety against loss on account of the debt which he, as suretjq assumes to pay. No cause of action could accrue to the defendant for a breach of the promise until he had in some manner been damnified. Although the note had not been taken up, he had never been called upon to pay it; nor does it seem to appear that the intestate's «state is insolvent, so that he will ultimately have to pay it. A party cannot set off, against a debt due from himself at the time -of the intestate’s death, a claim against the intestate not then existing or owned by himself. Code, § 506; Jordan v. Nat'l Shoe & Leather Bk., 74NY, 467. Nor should a cause of action be defeated by a mere equity that is not in itself sufficient to found an action upon. Armstrong v. McKelvey, 104 N. Y., 179 ; 5 St. Rep., 611; Canaday v. Stiger, 55 N.Y., 452. These considerations require that the judgment should be reversed, and render unnecessary an examination of the other questions presented by the appellant.

Judgment and order reversed, and a new trial granted, with <oosts to abide the event.

Hardin, P. J., and Merwin, J., concur.