author: Bradlet, J".:

text:
    BANK OF BATAVIA, Plaintiff, v. THE NEW YORK, LAKE ERIE AND WESTERN RAILROAD COMPANY, Defendant.

      JRaitroad company — liability of the company, to one advancing money on the faith of a hill of lading, issued hy its agent when no property was ever delivered to it — effect of the insertion of the words “ contents unknown,” in a bill of lading.

    The defendant’s agent, at Batavia, on March seventh made and delivered to one Williams an instrument acknowledging the receipt from him of “ the following articles (contents unknown) in apparent good order, viz.: Thirty-five barrels beans, I. T. Comstock, New York, marked and numbered as per margin, which the New York, Lake Erie and Western Railroad Company agrees to forward from Batavia to New York.” Williams on that day drew a draft on Comstock for $175, annexed it to the said instrument, and procured it to be -discounted by the plaintiff. A similar receipt for thirty barrels of beans was given by the defendant’s agent on March ninth, which was transferred by Williams to the plaintiff as was the first, annexed to' a draft for $150. The drafts were forwarded for collection and were not paid. [Hie property mentioned in the bills of lading, had never been delivered to the defendant and Williams was insolvent.

      In an action, brought by the plaintiff to recover the value of the said barrels of beans from the defendant:

      Held, that the defendant was equitably' estopped from denying the receipt thereof, and that the plaintiff was entitled to recover their value.
    That the insertion of the words “contents unknown” in the instrument was intended simply to relieve the company from the consequences of any fraud or deception practiced by the shipper in respect to that of which the carrier was ignorant, but as the presumption was that the shipper had not been guilty of fraud or dishonesty their insertion did not relieve the defendant from the ourden of proving that the contents of the package had been misdescribed.
    Motion by the- defendant for new trial on exceptions taken at tbe Genesee Circuit and ordered to be beard at General Term in tbe first instance.
    ■ Tbe defendant’s agent at Batavia on tbe 7 th day of March, 1881, made and delivered to E. C. Williams an instrument, tbe material portion of which was as follows:
    “ New York, Lake Erie and Western Railroad Co., }
    “Batavia Station, March, 7, 1881. }
    “Received from E. C. Williams tbe following articles (contents unknown) in apparent good order, viz.: 35 barrels beans, I. T. .Comstock, New York, marked and numbered as per margin, which the N. Y., L. E. & W. R. R. Co. agrees to forward .from Batavia to New York upon tbe following conditions, * * * and tbe acceptance of this receipt by the shipper constitutes tbe agreement for tbe transportation of tbe above described goods or property.
    “P. J. WEISS, AgentA

    And on the same day Williams drew bis draft of that date on I. T. Comstock, New York, for $175, payable at fifteen daj^s at tbe Bank of Batavia, annexed it to that instrument and presented it to the plaintiff for discount and it was discounted by the bank, and they were delivered to it. On the ninth day of the same month the agent made and delivered to Williams another instrument in all respects like the first, except the date and the statement of quantity of beans which was “ thirty barrels beans.” And on that day Williams drew his draft on I. T. Comstock, New York,.for $150 at ten days, payable at the same bank, attached it to that instrument and presented it to the plaintiff for discount and it was then discounted, and with the instrument annexed delivered to the plaintiff. The drafts were sent forward by the plaintiff for collection and were not-paid.
    The property mentioned in those bills of lading was not delivered to the defendant. "Williams was not l’esponsible. The drafts not having been paid the plaintiff brought this action to recover the' amount of them, and it appeai-s that sixty-five barrels of beans were then of the value $325. A verdict was directed for the plaintiff for that amount.
    The defendant’s exceptions were taken to the denial of a motion for a nonsuit and to the direction of the verdict.

      JE. G. Sprague, for the defendant.

      George Bowen, for the plaintiff.
   Bradlet, J".:

The instruments made by the defendant’s agent were in the nature-of bills of lading, and may be treated as such for the purposes of the questions presented for consideration. They were made from printed blanks furnished by the defendant to be used by its agents as receipts and agreements for transportation of property delivered for that purpose, and it was within the powers and duties of the agent Weiss to receive property delivered to the defendant for shipment and issue such bill of lading and deliver it to the shipper.

The plaintiff in good faith advanced to Williams the requisite amount as for discount of the drafts, relying upon the bills of lading as security, and accepted the delivery of them with the drafts as-such. It is contended by the defendant’s counsel that the pia.int.ifF was not entitled to recover because: 1. The agent had no authority to issue the bills of lading without first having delivery of the property to the defendant. 2. The defendant did not, nor did the agent represent to the plaintiff that the defendant had received the property. 3. The bills of lading did not have the quality of negotiability"; and 4. The words “ contents unknown ” so qualified the terms of the receipt that it did not contain a representation of ’receipt of the property mentioned as contents of the barrels.

Although it is common to insert in bills of lading the words order or assigns, they do not render them negotiable in the sense that bills of exchange and promissory notes are such, and at common /law no right- as a contract passes by indorsement and delivery of a s -bill of lading, bnt it represents property only, and its transfer so Í made vests title general or special in the property mentioned in it. And for that purpose no words of negotiability are required. It follows that no privity as between the maker and any third person to'such an instrument can arise out of negotiability of it, but the right of the latter rests in title to the property and against the carrier as bailee.

The question of negotiability is not applicable, and has no importance in this case so far as relates to the contract of the-defendant to transport.

The delivery of the bills, of lading to the plaintiff, with the drafts, ywould have been sufficient to vest in the latter all the interest the ¡drawer Williams had in the property (if it had been shipped) for - [the purposes of security for the payment of the drafts. (Thompson v. Dominy, 14 Mees. & Welsh., 402; Emery v. Irving Nat. Bank, 25 Ohio, 360; S. C., 18 Am. R., 299; National Bank v. Dearborn, 115 Mass., 219; Stollenwerck v. Thacher, Id., 225; Dows v. Greene, 24 N. Y., 638; City Bank v. R. W. and O. R. R. Co., 44 N. Y., 136; Merchants' Bank v. U. R. R. and T. Co., 69 N. Y., 373; Daniel on Neg. Insts. [3d ed.], §§ 1727, 1731.)

The character of bills of lading, their purpose and the principles : applicable to them were quite fully considered in the leading, case of Lickbarrow v. Mason (in K. B., 2 Durn. & E., 63, and in Exch. and H. L., 1 Smith’s Leading Cases, 858, 867). But Williams not having shipped the property mentioned in the bil[s, the plaintiff took no title by their delivery to him, and whatever rights, if any, the plaintiff had against the defendant were given by estoppel, because the defendant’s relation as bailee could not, nor could its undertaking to transport, become effectual unless and until the property was received.

Now arise the important questions in this case, they are eminently so, and their importance is somewhat increased for the reason that there is a marked conflict of authority both in results by decisions of the courts, and the grounds upon which they are placed. And they relate mainly to the proposition as to the extent '.limitation may be applied to the' powers of the agent in behalf of the principal, as against one in good faith relying upon the act of the agent purporting to be within the scope of his powers as such, but in fact as between the latter and his principal done without .■authority. That is one question in this case. The. plaintiff .advanced the money on the faith of the bills of lading made by the agent; they purported to be within the scope of his powers and ■duties as such, but those bills were made by him in fact in violation ■of his duty and without authority. He clearly had no right to issue a bill of lading without receiving the property, and in doing so ■committed criminal fraud. (Laws 1858, chap. 326, § 5.)

The contention that the principal is not chargeable under such circumstances to a bona, fide holder of the bill, who has advanced upon the faith of it, has the support of authority. In Ofcmt v. Norway (10 O. B., 665) it was held that a bill of lading made by a master of a ship for goods not received gave no right of action against the owner o*f the vessel to the plaintiff, who had made advances on the faith of the bill of lading and taken indorsement and delivery of it from the person named in it as the shipper. And that principle and case were adopted and followed in Hubbersty v. Ward (8 Exch., 330; 18 Eng. L. and E., 551); Coleman v. Riches (16 C. B., 104; 29 Eng. L. and E., 323); Schooner Freeman v. Buckingham (18 How. [U.S.], 182); Pollard v. Vinton (105 U. S. [15 Otto], 7); Robinson v. Memphis and Charleston Railroad Co. (9 Fed. Rep., 129, 142); Baltimore and Ohio Railroad Co. v. Wilkens (44 Md., 11; S. C., 22 Am. R., 26). This proposition's put upon the ground that the master of the ship, and the agent of the carrier, have no authority to issue bills of lading for property not received for shipment, that- such is the limitation of his apparent authority •of which everybody must take notice, and that it is a fraud on the part of the agent for which he, and not his principal, is liable to ■one making advances on the faith of the bill of lading. And the principle of those cases is declared as the correct and governing rule in Brown v. Powell D. S. Coal Company (L. R., 10 C. P., 562; S. C., 14 Moak, 420); Sears v. Wingate (3 Allen, 103; Lowell F. C. Savings Bank v. Winchester (8 Allen, 109-118 ; and see Daniel on Neg. Insts. [3d ed.], secs. 1733, 1733a.) Directly in conflict with those first before cited on this question is Sioux City and P. Railroad Company v. First National Bank (10 Neb., 556; S. C., 35 Am. R., 488), and they do not seem to have the support on principle of the courts of this State.

While the contention of the defendant’s counsel embraces, it goes beyond the question of apparent authority of the agent, and asserts the proposition that to support estoppel as against the principal it must go through the negotiability of an instrument, or the representation upon which reliance is placed must be made directly by the agent to the person who seeks to charge the principal.

'' As before remarked, there is no negotiable quality in the bill of (lading as a contract to aid the plaintiff. N or was the representation that the defendant had received the property made by the agent directly to the plaintiff. But it is usual, and such may be said to be mercantile usage well understbod, for* the shipper to obtain advances upon his bill of lading, and it is quite necessarily so for the purpose of carrying on business >of that character. (Lickbarrow v. Mason, supra, and S. C., 5 Dura. & E., 683; First National Bank of C. v. Crocker, 111 Mass., 168; Hathaway v. Haynes, 124 id., 311; Commercial Bank v. Pfeiffer, 22 Hun, 327; Marine Bank of C. v. Wright, 48 N. Y., 1.) And the holder of the bill of lading is presumptively the owner of the property mentioned in it, but the person taking delivery of it from a. third person is chargeable with notice as against its true owner of the fact if the possession of the one from whom he takes it is unlawful. Nor can it be effectual to vest title in one, who not being the owner or entitled, takes the bill of lading from the carrier. (M. and T. Bank v. F. and M. Nat. Bank, 60 N. Y., 40; Brower v. Peabody, 13 id., . 121; Dows v. Perrin, 16 id., 325; S. C., 24 id., 638; Walter v. Brewer, 11 Mass., 99; Saltus v. Everett, 20 Wend., 269; S. C., 32 Am. Dec., 541; Hieskell v. F. and M. Nat. Bank, 89 Penn. St., 155; S. C., 33 Am. R., 745; Gurney v. Behrend, 3 Ellis & B., 622.) But the carrier may be liable to a person making advances in good faith in reliance upon it as for negligently or wrongfully ' issuing it to a person not entitled to it. (F. and M. Bank v. Erie Ry. Co., 72 N. Y., 188.)

Such liability does not depend upon privity, but. on the consequences which come from the negligence or wrong that permits and induces the third person .to, and who does proceed and part with value to his prejudice upon the faith of the act.

The learned counsel for the defendant cites Mechanics’ Bank v. New York and New Haven Railroad Company (13 N. V., 599) on the question of authority of the agent and of estoppel, and in support of the doctrine of Grant v. Norway. That case purports to declare the rule that inasmuch as a certificate of stock does not have the character of negotiability, the bona fide assignee of such certificate issued by the agent of the company in excess of his power takes it subject, to the equities existing against the assignor and has no remedy against the principal. But the general purport in that respect of that case has been qualified by later cases, and its effect as authority limited to the questions necessarily involved in it; and so considered it does not reach the question here. In New York and New Haven Railroad Company v. Schuyler (34 N. Y., 30), which was brought against Schuyler and 320 other defendants to have certain certificates of the plaintiff issued in excess of and withont authority declared void, the court there limited the effect of the Mechanics’ Bank case to the result required by the propositions fairly in it, and held that although the certificates of stock so issued were void as such, the company by means of estoppel in pais and without the aid of any privity, except such as was created by the unlawful act and the consequential injury, was liable to bona fide holders of those certificates, not upon contract but for the tortious act of the company through its agent, for the reason that they were ultra vires, and by way of damages occasioned by the act of the^agent clothed with apparent authority. There the agent had power to issue certificates of stock to a certain prescribed extent. He fraudulently exceeded that by the issue of additional certificates without authority. The court held that the company was chargeable to holders in good faith for value of those certificates for the fraud of the agent, for the consequences of the acts committed by him beyond the powers granted, which is “based on the injustice of allowing a party to be the author of his misfortune and then to charge . the consequences upon others,” and stated as the proposition settled as the law of this State “that where the authority of an agent depends upon some fact outside the terms of his power, and which from its nature rests particularly within his knowledge, the principal is bound by the representations of the agent, although false, as to the existence of such fact.” And (p. 12) reaffirmed the doctrine of North River Bank v. Aymar (3 Hill, 262), wliich had been treated as overruled in Mechanics' Bank v. New York and New Raven Railroad Company.

In Pollard v. Vinton (supra), the court appreciating the force of the Railroad Company v. Schuyler case, suggested that there might be a distinction which would permit corporations to be charged by acts of agents in cases where an individual would not be chargeable, as the transactions of the former were wholly by agencies. But no such distinction is observed in the cases before cited. (And see Titus v. G. W. Turnpike Road, 61 N. Y., 237; Merchants Bank v. Griswold, 72 id., 472, 478; Fishkill Savings. Institution v. Nat. Bank, 80 id., 162, 168.)

It is difficult to see how the doctrine of the case of Grant v. Norway, and those following it, can be reconciled with the principle . upon which New York and New Haven Railroad Company v. Schuyler was determined, and they must yield to it as authority in this State. And inasmuch as the right of the plaintiff against the defendant is not dependent on privity, and the use made of the bills of lading in obtaining the advances on them was within that which might have been reasonably expected, it hardly seems necessary to consider further the contention that communication directly' from the agent to the plaintiff was necessary to charge the defendant.

In Griswold v. Haven (25 N. Y., 604), that proposition was neither affirmed or denied because it was not necessary to support the recovery. And although the court there moderately criticised some of the propositions announced in Mechanics' Bank v. New York and New Haven Railroad Company, it'adopted the limited . rule of agency authority, as applied to consequences, to persons acting in good faith, stated in that case, and brought its determination within it by means of the fact that the communication that the statement in the warehouse receipt in question was true, was made directly to the plaintiff by one of the firm composed of the defendants, and thus establish a privity between théni and the plaintiff; and referred to the escape from the Mechanics’ Bank case made in Farmers and Mechanics' Bank v. Butchers and Drovers' Bank (16 N. Y., 125), by the support of the fact of the negotiability of the instrument which' produced privity there, and added “ no doubt the negotiable character of the paper was essential to the plaintiffs’ right of action both in the ease of Aymar and that of the Butchers and Drovers’ Bank, because the only representation by the agent was in assuming to be authorized to execute the paper, and this being made primarily to another party, himself cognizant of the fraud, would, aside from the negotiable words, have afforded no 'ground of action to the plaintiff. 'The cases would then have been precisely like that of the New York and New Haven Railroad Company ” (p. 602), to which at that time it evidently seemed to the court proper and perhaps necessary to conform. And as the facts distinguished the case in that respect from Grant v. Norway it was unnecessary to overrule the latter. (P. 604.) But since the case of New York and New Haven Railroad Company v. Schuyler, privity in the sense stated in those cases is not essential to the support of equitable estoppel and the right of action based upon it. In Armour v. Michigan Central Railroad Company (65 N. Y., 111, reversing 3 J. & S., 563), where bills of lading were procured to be issued to one Michaels by defendant’s agent for goods not received, representing Michaels as shipper, and the plaintiff as consignee, the latter, upon the faith of the bill of lading, paid advance drafts drawn upon him by Michaels, the court held that he had right of action against the defendant. The determination of that chse removes the basis upon which Grant v. Norway and kindred cases rest, and effectually overrules them, and although the Grant case is disapproved, Dwight, C., distinguishes it, and brings the Armour case within Griswold v. Havens on the fact that the plaintiff was named as consignee in the bill of lading, and therefore through that instrument the representation by the defendant’s agent might be treated as made to the plaintiff. But that distinction is not substantial in view of the principle in such cases on which the estoppel in pais and consequent liability depeud. (N. Y. and N. H. R. R. Co. v. Schuyler, supra; F. and M. N. Bank v. Erie Ry. Co., 72 N. Y., 188.)

The requisites of estoppel and the general principles upon which it rests are familiar and well stated in Barnard v. Campbell (55 N. Y., 456), and the rule applicable to assignment of non-negotiable choses in action (Bush v. Lathrop, 22 N. Y., 535; Davis v. Bechstein, 69 N. Y., 440; Union College v. Wheeler, 61 N. Y., 88; Reeves v. Kimball, 40 N. Y., 299; Wilcox v. Rowell, 44 N. Y., 398), has no application to this case.

The question of estoppel might there arise if the maker or assignor voluntarily annexed a statement to it, which had the effect to induce a party in good faith and in reliance upon it to part with value. The authority of the agent in this case was general, to receive property for shipment and transportation and issue to the shipper bills of lading like that in question. The exercise of this power of issuing the bill depended upon the fact de hors the power — the receipt of the property — and that fact, whether or not the goods had been received rested particularly within his personal knowledge. And his statement in that respect, though false, made in sirch due manner and form,.charged the defendant in behalf of the plaintiff who legitimately and in good faith made the advances in reliance upon it as true.

This produces the situation to which equitable estoppel will for his protection be applied against the defendant within the rule well established in this state.

The statement of amount or quantity of goods mentioned in a bill of lading as against the common carrier is only prima facie evidence and may be explained or ‘contradicted. To that extent it may be treated as a mere receipt. (Meyer v. Peck, 28 N. Y., 590; Abbe v. Eaton, 51 N. Y., 410.) And when, as it is. quite usual, the words contents unknown ” are inserted, the statement of contents of the packages as expressed in the bill do not conclude the carrier or charge the company with the consequences of any fraud or deception practiced by the shipper in that respect, of which the carrier is ignorant at the time of issuing the bill of lading. (Miller v. Hannibal and St. Jo R. R. Co., 90 N. Y., 430.) That the consents in such case are different from those mentioned in the bill of lading is not presumed, but on the contrary the presumption arising would be against fraud or dishonesty on the part of the shipper, and relief against it would require prpof of the fact on the part of the carrier. (Hatch v. Bayley, 12 Cush., 27; Shaw v. Gardner, 12 Gray, 488.)

The defendant having issued its statement contained in its bills of lading, in the usual form of those mad,L by it, having prima facie the import and effect that the defendant had received the property mentioned in it for transportation, when in fact it had received nothing, cannot be permitted, to assert by way of relief from its wrongful or negligent act as against the plaintiff, that if the barrels had been received with the statement of the contents, that it possibly may have been false, and therefore because of the words “contents unknown,” the defendant has not represented that they were as stated in the bill, and the plaintiff was not justi fied in his belief that they were. The plaintiff has the right to charge his loss to the consequences of this act of the defendant through its agent, and for that purpose to base it upon the value of the contents of the packages as they were represented in the bills of lading. And if there was any question of fact for the jury (which is not apparent) that is not raised by the exception to the direction of the verdict, as the defendant’s counsel treated the questions presented by the evidence as those of law only, and did not request the submission of any question to the jury. (Barnes v. Perine, 12 N. Y., 18; O'Neill v. James, 43 id., 85.)

A new trial should be denied and judgment ordered for the plaintiff on the verdict.

Smith, P. J., and Haight, J., concurred; Barker, J., not voting.

New trial denied and judgment ordered for the plaintiff on the verdict.


source: Caselaw Access Project

author: BRADLEY, J. :

license: Public Domain

text:
    JULIUS A. PARSONS, Appellant, v. PERHAM O. TOWER, Respondent.

      Attorney — when he loses his right to enforce a claim of his own, by acting as attorney in an action for the enforcement of an inconsistent claim made by his client.

    This action was brought to recover the amount of an order, drawn by one Young, requesting the defendant to pay to the plaintiff the sum of $250 from money to become due to Young from the defendant for services rendered to him by Young. The order was accepted by the defendant, and at the time this action was commenced the requisite amount of money was due to Young. It appeared that prior to the time of the giving of the order the defendant had a bond of Young secured by a mortgage, and that it had been agreed that the money to become due for the services should be applied upon this bond. After this action had been ■commenced Young, the plaintiff appearing as his attorney, brought an action against tlie defendant to recover the whole amount due for the services rendered. In that action it was decided that the amount due for all of the services should be applied upon the bond, and judgment was entered accordingly.

      Held, that the plaintiff by conducting that action and by refraining from referring to the order held by him, or having the sum named therein-deducted from the amount allowed upon the bond, lost all right to enforce the payment thereof and could not maintain this action.
    Appeal from a judgment in favor of tbe defendant, entered on the report of a referee.
    The action was brought on an instrument made by Hiram Young to the plaintiff in the following form, viz.:
    “ To P. O. Tower :
    “ Please pay to Julius A. Parsons the amount that will be my due every Saturday night for manufacturing your cider into vinegar, until he is paid the sum of two hundred and fifty dollars.
    “ Dated April 1. 18Y8. “ H. YOUNG.”
    The plaintiff received this paper and presented it to the defendant who indorsed upon it the following, viz.:
    “Will pay the within when I owe H. Young the within amount.
    “P. O. TOWEK”
    And it appeared that, at the time this action was commenced, Young had performed for the defendant services in manufacturing cider into vinegar, amounting to upwards of $250, and that the defendant had refused to pay that sum to the plaintiff.
    The defendant held against Young a bond secured by mortgage at and before the time the order was made by the latter to the plaintiff. And there is evidence tending to show that there had been some time before an understanding between the defendant and Young, that the price of the work done by the latter for the defendant should be applied on the bond. After this action was commenced and before the trial of it, another one was brought by Young (in which the plaintiff herein was his attorney and counsel) against the defendant to recover for his services performed for the latter, issue was joined therein and it was tried before a referee who made a report whereby he found an agreement that the amount due for the services of Young should be applied on his bond, on which he found the amount due exceeded that for Y oung’s services, and that the amount due the latter was found and declared applied on tbe bond. Tbe referee dismissed tbe complaint and judgment was entered upon bis report on tbe merits.
    Thereupon tbe defendant by supplemental answer alleged the recovery of that judgment. Tbe referee in this action ctete™ined that the plaintiff was not entitled to recover, and directed judgment dismissing tbe complaint which was entered, and from it this appeal is taken.

      Julius A. Parsons, for tbe appellant.

      J. G. Record, for tbe respondent.
   BRADLEY, J. :

The instrument of April 1, 1878, was not a bill of exchange, but in terms purported to be an equitable assignment of tbe $250, which should become due Young for his services referred to, and in equity operated as such assignment so far as tbe drawer could effectually make tbe transfer, but at law it would not, without the defendant’s consent in some manner manifested to it, vest in the plaintiff the right to collect the money of him. When unqualifiedly assented to by the defendant such order would at law operate as an assignment of the fund, irrevocable by the drawer. (Morton v. Naylor, 1 Hill, 583; Munger v. Shannon, 61 N. Y., 251, 258.) And when received the fund would be deemed held in trust for the payee. It follows that the drawee may qualify his assent or acceptance by affixing to it terms upon which his liability to pay must depend. The defendant accepted the order in question in such manner as to impose on him no liability to pay until he owed Young $250, and by his answer insisted that having a claim against Young, upon which the moneys by the latter should be and had been applied, he did not owe him. The term owe ” imports an obligation or duty to pay. And whether the condition precedent in tbe defendant’s indorsement on tbe order was reached and accomplished, while tbe amount due him from Young exceeded that which the latter had earned in his service for the defendant, may be a question entitled to some consideration. That, however, might be one of construction of the indorsement involving inquiry into the the circumstances under which it was made with a view .to the intention of the parties to it.

In respect to what, took place between the plaintiff and defendant, at the time of the presentation and indorsement of the order, there is some conflict of testimony between them. And as the. referee (so far as appears by his report) did not consider that question in reaching his conclusion, it is not deemed advisable, nor is it necessary here, to determine it in the view taken of the case. In the action brought, tried and determined while this action was pending, and before it was tried, which was based upon a claim on the part of Young for all the services he liad performed for the defendant, without any allowance for the amount of this order or otherwise, as appears by the complaint, the referee found, substantially, that Young commenced service for the defendant in the spring of 1877 and continued in the performance of services for him until late in summer of 1878. That when the service commenced defendant held Young’s bqnd, and it was then understood between them that the amount which should become due, the latter should be applied upon it; that they accounted and settled in September, 1877, and the amount then earned by Young Vras ascertained and indorsed on the bond; that further work of manufacturing, etc., was done by Young that fall, pursuant to the same agreement, and that in the spring of 1878 its terms were modified in respect to price for the work, and pursuant to the agreement so modified the work of manufacturing vinegar in 1878 was done; that at the time of making his report there was due Young $529.39, to be applied upon the bond, the amount due on which was in excess of the last amount so applied. The effect of this report was.to make application of the whole, amount earned by Young (after deducting advances for current expenses) upon his bond held by defendant.

The plaintiff in this action then was an attorney and counselor of this court, and as such had charge of and conducted that action for Young from its commencement to conclusion. On that trial, so far as appears, no reference was made to the order or use made of it, and no allowance was sought to be -made of made to the defendant for or on account of it.

The referee in his report in this, referring to that action, finds that the plaintiff in this action, as attorney for Young, conducted the trial of that, and produced evidence tending to show that,Young was entitled to recover of the defendant the entire contract price for manufacturing vinegar, and that there was allowed by the referee to Young the amount so claimed, and that the amount so procured to be allowed to Young in that action by this plaintiff as his attorney, embraces the $250 which the plaintiff in this action seeks to recover. And that is the ground upon which the referee determined in this action that the plaintiff was not entitled to recover.

Treating the acceptance of the order as effectual to give the plaintiff the right to recover of the defendant its amount when Young had earned in the service $250, then plaintiff was entitled to recover in this action unless defeated by such other action or by the conduct of the plaintiff there. The defendant jheld the money as trustee for the plaintiff. The latter was at liberty to relinquish his right to it to Young, and mere consent or permission of the plaintiff that the defendant pay it to Young was sufficient to enable him to do it and be relieved from liability to the plaintiff. (Parker v. City of Syracuse, 31 N. Y., 376, 379, 380.)

The plaintiff went into court with Young and as his attorney and counsel, and so conducted the trial as to require the court to award and allow to Young this same $250. Was this a consent or permission on the part of the plaintiff, and was it not even direction, so far as he as counsel was able to give it, that this money be handed over to Young by application on the debt he owed the defendant ? By that action and its result so produced the defendant was divested of this fund, and it would seem that the right of the plaintiff as beneficiary was cut off. (Scudder v. Voorhis, 5 Sandf., 271.)

The defendant, under the circumstances, was not required to preserve his alleged liability to the plaintiff by seeking for that purpose to reduce the allowance to Young in that action, but was justified in relying upon the action there of the plaintiff in that respect, who was conducting the trial for Young. The plaintiff, as such attorney and counsel, was a sort of trustee of the interests of his client and his agent within the scope of his authority arising out of that relation (Poucher v. Blanchard, 86 N. Y., 260), and had the control and management on his part of the action. (Goodenough v. Spencer, 46 How., 351.) It is true the interests of his client alone were to be observed and protected by the conduct of the attorney and counsel. The interests of the client to be thus guarded were those which his legal rights afforded him and nothing more. The attorney is not required to impair his own interests involved when they do not conflict with such rights of the client, and when their preservation will not prejudice the legal interests of the latter.

■■ It was perhaps a matter of indifference to the defendant who had the $250. And when the plaintiff was there presenting that as. part of Young’s claim against the defendant, the latter had the right to assume that thqre was some reason satisfactory to the plaintiff for handing over to Young that fund, which practically he directed and caused to be done by his conduct of the trial. The order was not in defendant's possession or under his control. The means of giving to it all the availability it was entitled to, by way of protection of the interest of the plaintiff in it, were under the control of the latter.

Nothing occurred on that trial tending to show (so far as appears) that the plaintiff, as attorney and counsel, there sought to have the allowance of this sum there made to Young with the view of an attempt also to recover it in this action, and thus to make the defendant pay it twice. This the defendant, in j.ustice to the motive of the plaintiff, was not required to assume.

The fund referred to in the order having been paid or allowed to ■ Young, and so applied by the consent and permission of the plaintiff, cannot be recovered by him in this action.

The judgment appealed from should be affirmed.

Smith, P. J., Barker and Haight, JJ., concurred.

Judgment affirmed.


author: Bradley, J.:

text:
    JOHN PORTER, Appellant, v. THE VILLAGE OF ATTICA, Respondent.

      Private way in a milage — when it will become a highway by long use as such — what evidence will justify a finding of a dedication of a way to, andan acceptance of it by the public.

    .From the westerly side of a village street running north and south a way extended westerly for several rods to dwelling houses and a cooper shop. The sidewalk on that side of the street had formerly been constructed of planks which were laid at right angles to the course of the street, except at the place where this way intersected it, and there they were "laid lengthwise in the direction in which the sidewalk ran. Subsequently the plank sidewalk whs replaced by flagstones, but the planks laid at the place where the sidewalk was intersected by this way were not changed but were raised a little and earth was placed against them on the side of the street so as to render the approach from that side easy. This earth was washed. away leaving a hole into which the wheel of a wagon driven by the plaintiff from the cooper shop to the street slipped, whereby he was thrown from the wagon and sustained injuries, to recover damages for which he brought this action. Upon the trial evidence was given tending to show that the way had been used there for forty years; that for many years it led to a tavern which stood there, and that for twenty years or more dwelling houses had been erected there to which the way led.

      JSeld, that it was for the jury to say whether the way had become by its long continued use a public highway, or whether there had been any dedication by the owner and acceptance thereof by the public which would render the village liable for neglect to keep it in proper repair, and that it was error for the court to nonsuit the plaintiff.
    Appeal from an order of tire Erie Special Term, denying a motion for a new trial made upon a case and exceptions. The plaintiff was nonsuited at the close of his case.

      William S. Oliver, for the appellant.

      A. J. Lorish, for the respondent.
   Bradley, J.:

The action is for personal injuries suffered by the plaintiff which h.e alleges were occasioned by the negligence of the defendant, which is a municipal 'Corporation charged with the duty of keeping 'its streets in suitable repair.

Market street, one of the principal ones of the defendant, has a northerly and southerly direction, and coming into it from the west ■is a way extending westerly from it several rods to dwelling houses, a cooper’s shop, etc., which has been used for many, and the evidence tends to show more than twenty years before the time in question for the purpose of getting to and from the houses and business places there. Along the west side of Market street the defendant has maintained a sidewalk for many years, and at the place of entrance from the street the plank for the walk was laid lengthwise of it, and either way from that were laid crosswise. Sometime before the accident the defendant, for the walk on that side of the street, put down flagging, except that at the place of the approach to and from the street by this way plank lengthwise the walk was continued. The people had been accustomed, as occasioned required, to go with teams and vehicles loaded, and unloaded, from and to the street at this place over this way.

In September, 1819, the plaintiff, with his team to his wagon, drove from Market street at this place' into the way, and to the cooper’s shop after and obtained a load of barrels, and on his way out as the wagon passed over this walk it was so turned up or over that the plaintiff was thrown out and injured. And this was because there was no suitable approach from the street to the walk to enable loaded wagons to pass with safety from the walk into the street. It appears that some weeks before that time the defendant had raised the walk several inches, and there is evidence tending to show that after doing that the defendant, with earth, so filled in the street, side of the walk, as to make a slope suitable for an ajjproa'ch to this way, but that a few days or a week before the in jury that was carried away by water which had so washed out the earth as to make a hole or depression on the street side of and near the walk, into which the wheels of the plaintiff’s wagon dropped as they left the plank and caused the jar and tipping of the wagon and thus causing the injury.

¡ The plank so placed there by the defendant were entirely within the boundaries of Market street. The question presented at the trial was, whether this state of facts justified the conclusion that the defendant owed a duty to the public, which required it to maintain any means of approaching from and to Market street for the purposes of travel upon the way referred to. The court held that this way was a private and not a public one, and that there was no duty on the defendant to construct or maintain an approach from the street to it, and nonsuited the plaintiff.

So far as appears the owners of the premises over which the way passed had never done any formal act by way of dedication to the public further than to leave it open to use as such without interruption, nor had the defendant outside of the boundaries of Market street done any act upon or in reference to it, as that of acceptance of it as a public highway. This alleged defective condition was between the plank-walk and the ditch of the street, and did not impair the use of Market street for the purposes of travel in,and along .the line of that street, and it may be that for such purpose the defendant was not required to have wrought into suitable condition for travel the entire widtlmvithin the boundaries of the street, but sufficient only for such use by the public with safety. (Shepardson v. Colerain, 13 Met., 55; Howard v. North Bridgewater, 16 Pick., 189; Keith v. Easton, 2 Allen, 552; Kellogg v. Northampton, 4 Gray, 65; Smith v. Wendell, 7 Cush., 498; Dickey v. Maine Tel. Co., 46 Me., 483; Ireland v. O. H. and S. P. R. Co., 13 N. Y., 531.)

This, however, may not be applicable to the business and thickly settled parts of villages. It is there usual and generally required that the wrought portion for teams and the sidewalk reach to the outer boundaries. Them was no liability to owners of premises abutting the streets for injuries to the use of their property occasioned by the legitimate workof improving the streets, whether by cutting down or raising the bed of them. (Kavanagh v. Brooklyn, 38 Barb., 232; Lynch v. Mayor, 76 N. Y., 60.) So tne question here is one relating exclusively to duty to the public And this as a rule does not necessarily depend upon the fact that a roadway has been lawfully created a public one, so that it could be sustained as such between the constituted authorities and the landowner, but if those charged with the ■ duty of taking care of the streets, have treated it in such manner as to fairly permit the public to understand that a road used as such is a public one, liability may arise by means of the salutary rule in the nature of estoppel for injury occasioned by defective condition, or for negligence. (Houfe v. Fulton, 34 Wis., 608; S. C., 17 Am. R., 463; Sewell v. Cohoes, 75 N. Y., 45, 51, 52.)

While it does not appear that the defendant at any time did anything upon this road outside the boundaries of Market street by way of working or improving it, there is evidence to the effect that ■the village authorities having charge of the streets did, after raising the plank, provide an earth approach from the street and thus •facilitate passage from it into the way. Whether that had been •done by the defendant prior to that, or whether it was necessary1 before the walk was raised does not appear, but it may be inferred that until then no necessity existed. The village authorities had for many years distinguished this place of passage from other portions of sidewalk by continuing to maintain plank lengthwise the walk there, which adapted it better to purposes of passage over it with teams and wagons than if laid at right angles with the walk as elsewhere. These acts on the part of the defendant were recognition of the fact that there was a use to some extent of passage through there and on the way in question. The plank may have been so laid as matter of economy merely, on the part of the defendant, in view of the manner of passage over it, and solely for .a walk on Market street. That fact alone is too equivocal to con.stitute the basis of acceptance of the road by the defendant as a public street. There do not appear affirmative acts on the part of the defendant’s constituted authorities sufficient to justify the conclusion of acceptance of this road as a public one. (Trustees of Jordan v. Otis, 37 Barb., 50.) The question of dedication is one of intent on the part of the owner. And while to produce it his intent must be evinced by the act of setting the loous in quo apart .and surrendering it to public use as a highway in such manner as to show unequivocally a purpose to -absolutely and irrevocably devote it to such use. (Niagara Falls S. B. Co. v. Bachman, 66 N. Y., 261.) But both such dedication and acceptance may be inferred from continuous and uninterrupted use by the public for a sufficient length of time, say twenty years, as a . highway. (Rugby Charity v. Merryweather, 11 East, 375, note; Denning v. Roome, 6 Wend., 651; Pearsall v. Post, 20 id., 116; S. C., 22 id., 450; Gould v. Glass, 19 Barb., 179, 195; McMannis v. Butler, 51 id., 436; Cook v. Harris, 61 N. Y., 448; Bissell v. N. Y. C. R. R. Co., 26 Barb., 630.)

The authorities appear not to be entirely harmonious on the subject of the requirements to produce a public highway by dedication and acceptance, but attention has not been called here to any (presenting the question) holding that both may not be inferred by public uses for such "length of time, when no circumstances have intervened indicating limitation of either.

In Oswego v. Oswego C. Company, (6 N. Y., 257) there had been no public use of the alleged street at the time- in question. In Holdane v. Cold Spring (21 N. Y., 474; affirming 23 Barb., 103), only about two years had elapsed after the owner had fenced out an avenue partially through his premises. And Wright, J., there says: It is not necessary that there should be any formal act of acceptance by the public authorities, but it may be indicated by common user under circumstances showing a clear intent to accept and enjoy as such the easement proposed to be dedicated.”

In Clements v. West Troy (10 How., 199) he expresses the same views, disapproves Same Case (16 Barb., 251) and is supported by Smith, J., in Bissell v. New York Central Railroad Company (26 Barb., 635), and disapproved in Jordan v. Otis (37 Barb., 57). In Niagara Falls S. B. Co.v. Bachman (66 N.Y., 261, 269), that the fact ■of public user may constitute acceptance without formal action of the constituted authorities is recognized. And such seems to be the better rule. The highways are for the benefit of the public, and when they have by a common user clearly expressed their wants in that respect without violation of any private rights of property and through permission afforded by dedication, this common interest should not be subject to denial by the action or omission to act of a public officer. But if there be no other evidence of dedication on the part of the owner than the mere fact of his acquiescence in the use of the way as a public one, it would seem that twenty years user should be required to ripen into a right. (3 Kent’s Com., 451; Gould v. Glass, 19 Barb., 179.) When the fact of twenty years of such user is found, the importance of the question of dedication and acceptance substantially disappears. The statute declares then that it is a public highway. (1 R. S., 521, § 100; Devenpeck v. Lambert, 44 Barb., 596.) The right of the plaintiff to recover depends upon the question whether this way could be deemed a public one at the time of the injury, and there seems to have been sufficient evidence to send the case to the jury. There was evidence tending to prove that a road had been there for some purposes for forty years, and for many years a tavern was there to which it led, and that twenty years or more before the trial some dwelling houses were placed and occupied there, and this was a beaten road. Whether it was for and used by the public as a common way, or as a private way, or by license merely, presents a question foi the consideration of the jury. And although it was a cul de sao it was capable of being made a highway (People v. Kingman, 24 N. Y., 559), but the fact that only one end of this way terminated in a highway and was not a thoroughfare, was a circumstance which might bear materially on the question whether it was in fact a highway or used as such; whether the use or the right to use it had been or was a qualified one or to any and what extent limited. And in view of all the circumstances the question is peculiarly one for the jury. The question of dedication and acceptance will, or not, become one of importance as the evidence shall, or not, tend to show some unequivocal action on the part of the owner which may fairly be construed as actual intent on his part to dedicate and surrender this to the public as a highway; then the further question may arise whether or not there was the requisite user for, or otherwise, an acceptance which had the effect to produce a highway before the expiration of twenty years.

For the purposes of the public use of Market street as such merely it does not appear by the evidence to have been out of repair. The injury of plaintiff came from approaching’ it over this way. And the defendant is not required to provide facilities for owners .of abutting premises to go into. the street, and inconveniences occasioned to them by proper reparation of the streets are to be removed or reduced to conveniences by the owners themselves. In Requa v. Rochester (45 N. Y., 129) the alley for which the city failed to provide a proper and safe connection with the street intersected by it, was a public one. That case will be applicable if the way in question is found to be a highway.

In Burnham v. Boston (10 Allen, 290) the city was liable because it negligently omitted to erect a barrier to protect against an excavation made in a street and which was left so as to expose to danger and injury persons going into and upon the street by a private way quite commonly traveled. That is not applicable to thL» case., Here was no excavation made requiring a barrier to protect those on the street, but the sidewalk was merely raised.

The question here therefore is whether the defendant by reason of any duty to the public was required to provide suitable connection between Market street and the road referred to, for the purposes of passage from one to the other. The evidence was not such as to justify the court to hold as matter of law that the plaintiff was chargeable witli negligence. The testimony presented a fair question for the jury whether or not be was guilty of'contributory negligence under all the circumstances. (Weed v. Ballston Spa, 16 N. Y., 329; McGuire v. Spence, 91 id., 303; Hart v. H. R. B. Co., 80 id., 622.)

The order appealed from should he reversed and a new trial granted, costs to abide event.

Smith, P. J., and Barker, J., concurred; Haight, J., not sitting.

Judgment and order reversed, and new trial ordered, costs to abide the event.


text:
    GEORGE WATERMAN and Others, Respondents, v. GIDEON WEBSTER and Others, Appellants.

      Mortgage — construction of it — who is entitled to receive the principal and execute a satisfaciion-piece of the mortgage — what charges a purchaser with notice.

    In 1857, James and Jasper Waterman, who then owned certain real estate subject to the dower of their mother, conveyed the same to one Webster, who gave back a mortgage for $ 1,500 to J asper. The interest upon the principal sum was to he paid to the mother during her life, and upon her death $640.12 of the principal was to he paid to Jasper, and $850.89 thereof was to he distributed between the plaintiffs, childi-en of James, who were then minors, as they should respectively arrive at age, and in case of the death of any of them, then the survivors were to take that share; and if all should die before arriving at full age, then it was to he paid to James, and if he were then dead to his brothers and sisters. The said sum of $859.89 was directed to be invested during the minority of the children, the securities to be prepared ready to execute before it should be payable. The mortgage contained the usual power of sale to he executed by the party of the second part. After the death of the mother, and after the plaintiffs had all arrived at full age, the principal of the mortgage was paid to Jasper, who executed a satisfaction-piece of the mortgage, which was duly recorded.

      Sold, that he had no authority to receive the $859.89 directed to he distributed among the plaintiffs, and that they were entitled to have the satisfaction-piece set aside as to that portion of the mortgage and to foreclose the mortgage.
    That as the mortgage and the satisfaction-piece thereof were recorded, a purchaser from Webster had notice of Jasper’s lack of authority to receive the plaintiffs’ money, and was not protected as a purchaser in good faith without notice.
    Appeal from a judgment in favor of the plaintiffs, entered on a decision of the Cattaraugus Special Term and upon the report of a referee.
    The question involved in this case turned upon the proper construction of a clause contained in a mortgage; which reads as follows: “ This grant is intended as a security for the payment of the sum of fifteen hundred dollars and interest from date as follows: Interest on the whole sum payable annually to Sarah Waterman, mother of 6aid Jasper, during her life, and the sum of six hundred and forty dollars and twelve cents, payable in three years from date, in case of the decease of the said Sarah Waterman within that time; in ease she should live beyond that time it shall be payable on her decease to said Jasper, and the interest accruing after her decease to him, or said sum of six hundred and forty dollars and twelve cents; and the said sum of eight hundred and fifty-nine dollars and eighty-nine cents payable in four years, and interest on the same accruing after the decease of said Sarah Waterman; and in case she sliould live beyond that period, then on her decease on the following conditions : That the said sum of eight hundred and fifty-nine dollars and eighty-nine cents, and interest on the same accruing after the decease of the said Sarah, shall be invested in or secured an real estate of value sufficient to render such sums secure for the benefit of George Waterman, Charles H. Waterman and Earl E. Waterman, children of James M. Waterman, or the survivor of them, to be distributed between them when they respectively arrive at age ; and in case of the death of either of them the survivor, or survivors, to take his share of said sum, the securities to be prepared ready to execute before it shall be payable; and in case of the decease of all of the said children before they become of age, then the sum hereby secured for their benefit shall be payable to James M. Waterman, if be shall then be living, and in 'case of his death to the brother and sisters equally of the Said James M. Waterman then surviving on the same conditions.”

      C. D. Mwrra/y and Morris ds Lambert, for the appellants.

      W. Woodbw'y, for the respondents.
   Bradley, J.:

The action was brought to set aside and have canceled of record a satisfaction, and for the foreclosure, of a mortgage made by the defendant Webster to Jasper Waterman. For some years prior and up to 30th November, 1857, James Waterman and the defendant Jasper Waterman, brothers, owned the premises in question subject to the dower of Sarah Waterman their mother. The plaintiffs were then the minor children of James. The defendant, Jasper Waterman, in behalf of himself, his brother James and his mother, negotiated a sale of the premises to defendant Webster, and conveyance was made to him, and he to secure $1,500 of the purchase-money made a mortgage on the premises of date November 30, 1857, in which Jasper Waterman was named as the party of the second part, and by which the interest on the principal sum of $1,500 was made payable annually to Sarah Waterman during her life, and on her death $610.12 of the principal to Jasper Waterman, and the residue $859.89 with accrued interest to be distributed between the plaintiffs when they respectively should arrive at age, and in case of the death of an'y of them the survivor or survivors of them take it, and if all of them die before arrival at age, then payable to James Waterman, and if he should also then be dead, to his brother and sisters equally. And the mortgage further provided that the principal sum of $859.89, and interest accruing on it after the decease of Sarah, should be secured on real -estate of adequate value to secure the fund for the benefit of the plaintiffs; that the securities be prepared ready to execute before it shall be payable, and that the same be payable in four years from the date of the mortgage. And if Sarah should live beyond that time, then on her decease. The right of the mortgagor was reservéd to have the mortgage discharged at any time after three years on execution of another payable in the same manner on other land of sufficient value situate in the State.

The mortgage contained the usual power of sale and provided that the power might be executed by the party of the second part, his executors, administrators or assigns in case of default in payment of the principal or interest and to retain the amount for principal and interest, etc. The mortgage was delivered to Jasper and was recorded in Cattaraugus county. The mother died May 3, 1870. The $640.12 payable to him was, with interest, paid to his assignee, and the $859.89, with accrued interest, was by the mortgagor paid to Jasper in March, 1871, and he acknowledged satisfaction, which was recorded in Cattaraugus county clerk’s office.

The complaint charges that the. payment to Jasper was unlawfully and wrongfully made; that the defendant Hill had purchased the premises with notice of the circumstances, and that the discharge should be canceled of record and the premises charged with the mortgage in behalf of the plaintiffs and sold to satisfy the debt due them, and that the parties ^lefendant be barred, etc. The court so held and directed a reference to determine the matter of counterclaim alleged in the answer, and directed judgment on filing the referee’s report. The referee made and filed his report that there was nothing due from the plaintiffs, and judgment was entered pursuant to the decision of the court in favor of the plaintiffs for the entire relief asked for by the complaint. This appeal is taken from that judgment. ‘

No testimony of witnesses appears in the record, although it is said some was given. The facts tound will be deemed supported by evidence where any is required other than such facts as are wholly dependent on the terms of the mortgage.

The main inquiry is whether the mortgagor was justified in making the payment to Jasper Waterman of the sum, which by the instrument was to be distributed between the plaintiffs. This question is understood to be dependent upon the construction of the mortgage. It may be assumed that the $859.89 was the portion of the unpaid purchase-money which belonged to James Waterman. When the mortgage was made the plaintiffs were minors of about-the ages of eight, ten and twelve years.

The investment of that principal sum was made by their father for their benefit,,and on arrival at the age of twenty-one years they were entitled to receive it. The contention on the part of the defendants is that inasmuch as Jasper Waterman was the party of the second part to the mortgage, and in view of the powei by its terms vested in him, he must he treated as a trustee for the plaintiffs and the person to make the distribution between them. The relation of one as trustee of another person competent to act for himself is not presumed in respect to property or rights of the latter, but must be established by evidence showing its creation. This money secured by the mortgage was clearly the property of the plaintiffs and by the terms of the mortgage it was payable to them; and when it was paid to Jasper they were of age and competent and entitled to receive it. The terms distribute between them on arrival at age respectively can be construed only as a provision for payment to them.

The defendant Jasper was clothed with a power in the nature of duty to see that the fund was protected by continued investment and augmented by accumulation of interest during the minority of the plaintiffs. For that purpose and that only he was a mere instrument, and when they reached maturity his power terminated and their right became- complete, and the stipulation of the mortgagor to pay to or distribute between them was theirs. No further investment was contemplated. It was the duty of the mortgagor to pay it and their right to receive it. The mortgage itself so declared.

That instrument quite clearly shows that there was no intention when it was made that the money should be taken and held by Jasper for the plaintiffs,- and so carefully was it guarded in that respect that it was required that before the money should be payable (during the minority) securities should be prepared ready for execution for the protection of the fund. -There is no provision that the money in question should be paid to Jasper. The mortgage makes the 2,12 payable to him, and no more; that was his portion of the sum secured by it. There is nothing in the terms of the mortgage which can be fairly construed to make him a trustee for the matured plaintiffs, or a medium for transmission of the fund from the mortgagor to them, and when they were emancipated from disability by age they must be deemed representatives of their own rights in respect to tins fund, unless they are defeated in that by the fact alone that their uncle Jasper is a party to the mortgage, and therefore his intervention is necessary in their behalf. The old common law rule that in respect to a deed inter partes a stranger ■could not at law avail himself of a stinulation in his favor contained in it was technical and does not exist in this State. (Lawrence v. Fox, 20 N. Y., 268; Burr v. Beers, 24 id., 178; Record v. Sanderson 41 id., 179; Thorp v. The K. C. Co., 48 id., 253.)

The mortgagor is deemed to have this fund as part of the purchase-price, as trustee for those entitled to it, and his stipulation in the mortgage to pay it to the plaintiffs was effectual to vest in them the right to recover and receive the sum secured for their benefit directly from him. No trust in Jasper arose from necessity in their behalf. And it would seem to follow that the payment to him was not within any authority afforded by the mortgage. But reference is made to the right given Jasper to execute the power of sale and receive the money iu that event. That was necessarily to-enforce the collection of the sum he was entitled to of iliat secured. And so far as it related to the fund secured for the plaintiffs, this-provision had reference to a proceeding during their minority. After that time the execution of the power would necessarily be for their benefit and subject to their control alone after paymeut of the amount payable to Jasper. They being entitled to the money so to be distributed between them, all the rights afforded by the mortgage to enforce payment were then by operation of law vested in the plaintiffs, including that of the execution of the power of sale for the purposes of the sum due them. The statute provides that “ where a power to sell lands shall be given to the grantee in any mortgage or other conveyance intended to secure the payment of money, the power shall be deemed a part of the security, and shall vest in and may be executed by any person who by assignment or otherwise shall become entitled to the money so secured to be paid (1 R. S., 737, § 133), thus, for all practical purposes, making the plaintiffs parties to the mortgage as effectually as the assignment by a creditor of a debt secured by mortgage would give that relation to the assignee. (Pattison v. Hull, 7 Cow., 747; Barlow v. Myers, 64 N. Y., 44; Payne v. Wilson, 74 id., 354, 355; Perot v. Lavasseur, 21 La. Ann., 529.)

The defendant, Jasper Waterman, had no more legal right than a stranger to receive payment of the money due the plaintiffs and satisfy the mortgage, and of this the mortgagor was advised by the terms of it.' The mortgage could have no vital existence independent of the debt secured by it or separated from it in ownership. (Jackson v. Blodget, 5 Cow., 202; Langdon v. Buel, 9 Wend., 80.) And when the plaintiffs, by the arrival at the age of twenty-one years, became vested with the unqualified right to the money, the mortgage ipso facto, with the right to enforce the mortgage for the purposes of that fund, became theirs with the same • effect as an assignment in fact by a creditor of a secured debt would operate to pass the security collateral to it. (Parmelee v. Dann, 23 Barb., 461.)

The statute (1 R. S., 761, § 28) directing the clerk to discharge-a mortgage on the record on the presentation of a certificate of the mortgagee, his personal representatives or assigns, acknowledged, etc., does not give to the mortgagee power to discharge it when he has no right to, or to receive the money secured by it. (Heilbrun v. Hammond, 13 Hun, 475; Belden v. Meeker, 47 N. Y., 308.) Within the facts as found the defendant Hill was not a bona fide purchaser as against the plaintiffs. The conclusion of the trial court that the money was unlawfully paid to the defendant Jasper, and that the satisfaction acknowledged by the latter and recorded was ineffectual to discharge the mortgage, was justified by the evidence. And the referee properly disposed of the alleged counter-claim upon his finding of the fact. There was no opportunity to assert any personal liability of the plaintiffs for the support given them by defendant Webster’s assignor. That was furnished to them while they were minor children pursuant to arrangement with their father. And there is no equitable rule-which will charge this fund with the payment of' such claim in behalf - of a creditor-at-large of the latter.

The judgment shonld be affirmed, with costs.

Smith, P. J., and Corlett, J., concurred; Barker, J., not sitting.

Judgment affirmed, with costs.


text:
    In the Matter of the Estate of CATHARINE LATZ, Deceased.
    Surrogate Court— right of an administrator to compel the executor of his predecessor, to account— Oode of Oivil Procedure, sec. 2606 — Bight of the legislatu/re to gime a new remedy after the existing one is ba/rred by the statute of limitations.

    February 6, 1873, Catharine Latz died intestate, and on February thirteenth letters of administration were issued upon her estate to John Latz, under which John Latz drew from a bank the sum of $1,050.51, which was all the personal property she left. He never accounted to the surrogate and died on May 18,1880, leaving a will, letters testamentary upon which were issued to his widow on August 26, 1880. On September 22, 1880, the petitioner in this proceeding was appointed administrator de bonis non of Catharine Latz. On December 14, 188Í, he filed a petition with the surrogate to compel the executrix of John Latz to judicially settle the account of her husband as administrator of Catharine Latz. The application was denied on the ground that it was barred by the statute of limitations.

      Held, that this was error; that the right to compel such an accounting was conferred upon the petitioner by section 2606 of the Code of Oivil Procedure, and did not exist prior to the passage of that act.
    That even if the right of the next of kin to compel an accounting and to recover the unadministered assets of the estate of Catharine Latz had been barred by the statute of limitations, the right of the petitioner to compel this accounting would not be lost.
    Appear from an order of the Surrogalje’s Court of Erie county, dismissing the petition of Martin Clark, as administrator de bonis non of Catharine Latz, deceased.

      Mortí/n. Glorie, petitioner in person.

      Adelbert Moot, for the respondent.
   Bradley, J.:

On the 14th day of December, 1881, Martin Clark, the appellant, filed with the surrogate of Erie county his petition by which it appeared that Catharine Latz died intestate on 6th February,. 1873 ; that letters of- administration were issued to John Latz and his inventory filed on the thirteenth of that month, which represented that all the personal estate of his intestate consisted of $1,050.51 in bank; that John Latz, as such administrator, immediately drew that money from the bank, and did nothing further as administrator ; that he never rendered any account; that on 18th May, 1880, John Latz died leaving a will by which he nominated Catharine Latz, then his wife, executrix, which was admitted to probate and letters testamentary issued to her on 26th day of August, 1880, and she duly qualified; and that the appellant on 22d September, 1880, was appointed administrator de bonis non of Catharine Latz, deceased, took out letters of administration and duly qualified. The prayer of the petition is for a judicial settlement of the account of John Latz as such administrator, and that Catharine Latz as such executrix be cited to show cause why she should not render and settle such account and deliver over to the petitioner any of such property which had come to her possession or was under her control.

The answer of Catharine admitted the facts of death and proceedings before the surrogate, denied the other allegations of the petition upon information and belief, and alleged that more than six years having elapsed since the claim of Catharine Latz, deceased, or her representatives accrued, it is barred by the statute of limitations.

The matter came on to hearing and without proof and upon the facts stated in the petition it was dismissed, upon the ground that the six years statute of limitation was a bar. This proceeding was instituted under section 2606 of the Code of Civil Procedure. It is not deemed necessary to inquire whether before the Code of Civil Procedure the statute (2 R. S., 95, § 68) was applicable to the case of a successor to a deceased administrator, or whether there was any statute authorizing the representative of the latter to be cited to account by such successor before the surrogate. There was no statute which required such representative to deliver the trust property over to such successor. (2 R. S., 95, § 71; Annett v. Kerr, 2 Rob., 556, 569; S. C., 28 How., 324; Gerould v. Wilson, 81 N. Y., 580.) But as the representative of the next of kin he had an interest in seeing that his predecessor’s account was correctly rendered, and for that purpose and for discovery it is supposable he could file a bill in equity (Wiggin v. Swett, 6 Met., 194; S. C., 39 Am. Dec., 716, 719), although it has been held that at common law the accounting in his action could not extend beyond, but was confined to the unadministered portion of the estate, inasmuch as there was no privity between the deceased and the succeeding administrator, and as the latter had no right except such as related to the unadministered portion of the assets of his intestate, (Am. Board of F. Missions, 27 Conn., 344; Beall v. New Mexico, 16 Wall., 535; Slaughter v. Froman, 5 T. Mon., 19; 17 Am. Dec., 33; Chamberlain v. Bates, 2 Porter, 550; 27 Am. Dec., 667; Potts v. Smith, 3 Rawle, 361; 24 Am. Dec., 359.) And that beyond this the remedy was with the next of kin, etc. (Stubblefield v. McRaven, 5 Sm. & Marsh., 130; 43 Am. Dec., 502.) But that he might by action set aside a fraudulent sale and recover the property so disposed of by the chief administrator. (Swink's Admrs. v. Snodgrass, 17 Ala., 653; 52 Am. Dec., 190.)

The right of recovery was necessarily confined to the assets remaining unadministered, which might be reached by actions at law and in equity as their nature and situation required.

In the case at bar it does not appear whether or not the money of the appellant’s intestate was converted or in any manner appropriated, by the deceased administrator. It was by him taken from the bank. If he converted it to any use it'would not now be deemed unadministered property, but if he set it apart, and kept it separate from his, and it continued so to the time of his death it would probably go to the appellant. (Gregory v Harrison, 4 Fla., 56, 66.) In any other view there would not seem within the common-law rule to be any beneficial importance to this petition. The contention on the part of the respondent is that at the time section 2606 of Code Civil Procedure became law, and when this proceeding was instituted, the remedy sought by it was barred ‘by the statute of limitations. If he is right in this the petition was properly dismissed. The weight of authority is to the effect that the right of defense derived from the bar by that statute is in the nature of a vested one, and effectual as against subsequent legislation. (Ryder v. Wilson's Ex'rs, 41 N. J., L. R., 9; S. C., 8 Reporter, 152; Girdner v. Stephens, 1 Heisk., 280; 2 Am. R., 700; Bradford v. Shine's Adm'r, 13 Fla., 393; 7 Am. R., 219; Yancy v. Yancy, 5 Heisk., 353; 13 Am. R., 5; Rockport v. Walden, 54 N. H., 167; 20 Am. R., 131; Shriver v. Shriver, 86 N. Y., 580, 581.)

This question here depends upon the fact that for six years or more there was a remedy at law concurrent with that in view by this proceeding, although this in its nature and form is equitable.. Before the Revised Statutes there was no statute of limitation applicable to suits in Court of Chancery. The rule of limitation was adopted there as matter of practice only, and thus made analogous to that in court of common law in cases where jurisdiction was concurrent. (Bertine v. Varian, 1 Edw., 313; Borst v. Corey, 15 N. Y., 509; Clark v. Ford, 3 Abb. [N. S.], 217.) The Revised Statutes applied the limitation to those cases iia chancery which was declaratory of the rule that court had before adopted. (2 R. S., 301, § 19.) And the Code in removing distinction in forms of action has preserved that rule. (Salisbury v. Morss, 7 Lans., 368; Drake v. Wilkie, 30 Hun, 537.) More than seven years intervened between the time letters of administration were issued to John Latz and that of his death, and during more than six years of that time an action at law might have been brought against him by the next of kin of his intestate for any share they were entitled to of her estate. (2 R. S., Ill, § 9.) It follows that the next of kin were so barred of remedy by the statute of limitations that they could not maintain a proceeding by petition for accounting, etc., at the time'of the commencement of this proceeding (McCartee v. Camel, 1 Barb. Ch., 455; Smith v. Remington, 12 Barb., 75; Am. B. Soc. v. Hebard, 51 id., 552; affirmed, 11 N. Y., 619; Cole v. Terpenning, 25 Hun, 482.) They may yet have remedy on the bond of the administrator. The creditors, if any, were not barred by the statute at the time of the death of the chief administrator (2 R. S., 118, § 8), but their remedy at law went against the executor of his will after she took letters.

This proceeding is an equitable one in form, and in relief sought. The petitioner does not proceed to enforce the payment to him as a creditor or next of kin, but simply to require the representative of his predecessor administrator to account, and to deliver to him what it will appear in such accounting he may be entitled to. This ■does not come within the case of Clark v. Ford (1 Abb. Ct. App. Dec., 359; S. C., 3 Keyes, 370 and 31 How., 178; 3 Abb. [N. S.], '215). There the petitioners were legatees, and their proceeding was characterized as one to enforce payment. The statute of limitations takes only the force which its provisions give, and the fact that a remedy existing in behalf of one party may in its result operate indirectly for the benefit of another, whose right of action is barred by the statute, does not necessarily force the application of the statute so as to bar tbe former. On the expiration of the requisite time it merely bars the remedy of those who come within it. To that extent it is a statute of repose (Pratt v. Huggins, 29 Barb., 277) and does not pay the debt or produce presumption of payment. [Johnson v. A. and S. R. R. Co., 54 N. Y., 416; 13 Am. R., 607.)

The remedy which the petitioner had when he commenced this proceeding was not concurrent with any right of action in him at law, and therefore was not within the six years’ limitation, but would come within that of ten years. And it is difficult to see how the fact that the remedy of the next of Mn is barred can affect his for the purpose of the question as presented here.- But a remedy by petition like this did not exist until September 1, 1880, when section 2606 of Code of Civil Procedure became operative. The petitioner took from that whatever right he had in that respect, and without the death of the chief administrator or other cessation of his trust that could not produce occasion for such relief by a successor as that .prayed for. No reason appears why the legislature could not create a remedy when none before then existed in a case like this. The deceased executor could not, nor did his representative have any vested right in the estate of the testator, merely because there was no remedy to reach it if such were the case.

In People, v. Starkweather (42 N. Y., Supr. Ct. R., 10 J. & S., 326), the court held that the legislature had power to give a remedy by action for a cause that had been barred by an existing statute. There the right of action in the city of New York to recover against one of its officers for moneys appropriated having been barred by the statute of limitations, an act was passed giving right of action to the people of the State to recover against city officers practically for the benefit of the city. . And it was held that the right so given was effectual to create a remedy although that of the city was barred. That principle is applicable to this case. The petition on which the appellant’s application for appointment was made does not appear in the record. It must be assumed that sufficient reason was given there for his appointment, and that this proceding is justified. We do not consider any questions that may arise on, or the effect of, the accounting or what rights may in any event be derived from it. And express no opinion in that respect. The statute of limitations does not seem to be a bar to the proceedingj nor does any reason now appear for tbe dismissal of tbe petition.

The order or decree appealed from should be reversed, and as the question presented is new, neither party should have costs of this appeal against the other.

Smith, P. J., Barker and Haight, J J., concurred.

Order appealed from reversed, without costs to either party.