author: Van Brunt, P. J.

text:
    William Baumgarten, App’lt, v. William G. Nichols et al., Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    Corporations—Action to set aside transfer of partnership business to.
    A. & B., partners in business, and 0. formed a corporation, A. & B. putting in their business and 0. a certain sum of money. A. brought an action to set aside the conveyance of the partnership property to the corporation, alleging that C. obtained his money to put into the corporation from B., who had the smaller interest in the firm, and that B. & 0., having a majority of the stock, combined to take control of the business. No allegation was made that B. or 0. had done anything in the management of the corporation detrimental to its interests, or that misrepresentations were made. Held, that the action could not be maintained.
    Appeal from interlocutory judgment sustaining demurrers to the amended complaint.

      Noah Davis and J. Henry Work (A. L. Pincoffs, of counsel), for app'lt; Foster & Thomson and Seymour & Hopkins (J. Thomson J. H. Seymour, of counsel), for resp’ts.
   Van Brunt, P. J.

This action is brought to set aside a conveyance to the corporation of Herter Bros, by the plaintiff and one William Gr. Nichols on or about the 2d of February, 1891. The complaint alleges that prior to said date the plaintiff and said William Gr. Nichols were copartners in business under the firm name of Herter Bros., and that in said copartnership the plaintiff was the senior partner, and owner of a majority interest therein, •the plaintiff being entitled to 60 per cent of the profits, and the ■defendant Nichols to 30 per cent thereof, they being the only partners in the firm; that the defendant Norton, had been for several years in the employment of the plaintiff as salesman, and was familiar with the affairs and business of said firm ; that during the year preceding the said deed mentioned the said William. Gr. Nichols repeatedly expressed to the plaintiff his desire to retire from the active participation in said business, and proposed to the plaintiff the formation of a corporation in the nature of a. stock company, to which the business of said firm should be transferred, and that the plaintiff and, said William Gr. Nichols should, receive shares of stock in said corporation representing their proportionate interest in the assets thereof, which proposition was; accepted by the plaintiff; that said Nichols further proposed that said Norton should be asked to contribute to the assets of said corporation by paying for and receiving stock in said corporation,, so that said Norton should be independently interested in the assets and business of said corporation; that the plaintiff assented to the proposition, and thereafter proposed to said Norton that he should invest a certain sum, in cash, in the stock of said corporation, and Norton accepted the proposition, and agreed with the plaintiff to make such investment on his own behalf, and to pay for an interest in the stock of the corporation to be formed the sum of $50,000 in cash; that it was thereupon agreed between the plaintiff, Nichols, and Norton that a corporation should be formed, to which should be transferred the capital account of the-plaintiff, as the same stood upon the books of said Herter Bros, on the 1st of February, 1890, and also the capital account of said Nichols, and the good will of the old firm of Herter Bros., including the right to use the firm name of Herter Bros., and to-which corporation there should also be transferred and paid over an additional sum of $50,000 in cash; that such corporation should have a capital stock, in all, of $375,000, of which the plaintiff was to receive $175.000 on the transfer to him of his interest in said firm, and the defendant Nichols was to receive $145,000 on a like transfer by him, and the defendant Norton, on the payment and investment by him, on his individual behalf, of the sum of $50,000, should receive shares in the capital stock of said corporation to the amount of $60,000, par value. (There seems to besóme discrepancy in the figures here stated, but they are so contained in the complaint.) The complaint further alleges that it was further agreed between the plaintiff and the defendants-Nichols and Norton that the trustees who were to conduct the business of the corporation for the first year thereof “ should be-the defendants William Gr. Nichols and William S. Nichols, the father of the said William Gr. Nichols, who should represent upon said board the interests of said defendant William Gr. Nichols and this plaintiff, William Baumgarten, and the brother of this plaintiff,. Emile Baumgarten, who represent the interests of this plaintiff in said corporation, and the defendant, Arthur Norton, who should represent the separate individual interest of said Norton, consisting of his individual investment in the stock and assets thereof the parties seeming to have the idea which too commonly pervades trustees of corporations, that they were made such trustees for the purpose of looking after individual interests, instead of the interests of the corporation which they were supposed to represent.

The complaint further alleges that pursuant to this agreement, and for the purpose of carrying the same into effect, the plaintiff united with Nichols in making and filing a certificate for the incorporation of a stock company to be known as Herter Bros., the names of the trustees who were to conduct the business for the first year being inserted as above stated to have been agreed upon; and subsequently the plaintiff united with Nichols in the •execution of the conveyance and transfer to such corporation of the property and business of such copartnership; “that at the first meeting held for the purpose of organization of such corporation the defendant Norton stated that he was not able to comply with his agreement to pay the sum of $50,000 in cash for an interest in the assets of said corporation, and was prepared to pay ■only the sum of $30,000; ” that said Norton thereupon paid over to said corporation $30,000 in cash as his own individual payment, and representing the individual investment of said Norton in the assets of said corporation, and the remaining capital stock of said corporation, to wit, the sum of $345,000, was issued to the plaintiff and the defendant William Gr. Nichols in consideration of the conveyance by said plaintiff and said Nichols to the corporation of the business and property of said 'Herter Bros. The complaint further alleges that in joining in the making and execution of such conveyance the plaintiff relied upon the agreements herein-before set forth, and the facts hereinbefore stated, as to the respective interests to be taken and paid for by the parties named; ^ the allotment and payment for such interests being material facts in said agreement, as affecting the action of the plaintiff with respect to the carrying out of the same. The complaint further alleges that, owing to the premises, “ there existed between the defendants William Gr. Nichols and Arthur Norton and the plaintiff relations of trust and confidence, and that the plaintiff relied, in consenting to the conveyance of the property of the firm of Herter Bros, to the corporation, on the good faith of such defendants, and on the fact that they owed to this plaintiff the duty of disclosing to him all material facts relating- to their connection with each other and said corporation.” The complaint then alleges that the true facts and relations between the parties to said agreement were not those stated to and relied upon by the plaintiff, as hereinbefore stated; that Norton did not, and did not intend to, become interested in said corporation by the investment therein of money on his individual behalf, and did not intend to, and did not acquire, as independent owner thereof, the interest in said corporation agreed to be transferred to him ; that it was not true •that Norton paid his own money for an interest in said corpor-' ation, but said money was given or advanced by the defendant, William Gr. Nichols, and was in fact the money of Nichols, and that the fact was that Nichols intended to, and did, acquire an additional interest in the property, sufficient, when added to his interest, to confer upon said Nichols the control of the corporation, as against the plaintiff; and that all these things we°re concealed from the plaintiff, the object of such concealment upon the-part of Nichols being to take away from the plaintiff the control of the business of Herter Bros,, and. obtain the same himself. These allegations are amplified in the complaint, but it is not necessary to refer to them more at length. The complaint then alleges that the reason he consented “ to the formation of the corporation in which Norton was to be a stockholder, and the conveyance of the property of the firm of Herter Bros, to such corporation, was that plaintiff relied on the fact that the defendant Norton would act as such stockholder in the interests of said, corporation,” which seems to be the only allegation in this complaint that any trustee was to act in accordance with the duties which his office devolved upon him, “ and that there was nothing in his relation, either to this plaintiff or to the defendant, William G-. Nichols, which could in any way influence him, or which might tend to prevent him from acting with impartiality, in any conflict which might arise between this plaintiff and the defendant, William Gr. Nichols.” Then follows the allegation “that no money has been paid to the treasury of the corporation bj- any person except the plaintiff and the defendants, William Gr. Nichols and Arthur Norton, and that all other persons appearing as stockholders of record on the books of such corporation, and any persons to whom certificates may have been transferred, hold their stock without having paid any consideration for the same, or with full knowledge of the said fraudulent concealment, and of the deceit practiced on this plaintiff, or both.” To this complaint the defendant, Herter Bros., and the defendant, William S. Nichols, demurred upon the ground that it did not state facts sufficient to constitute a cause of action. These demurrers being sustained, from the interlocutory judgment thereupon entered this appeal is taken.

It may be sufficient answer to this complaint to say that Norton had paid $80,000 in cash into this corporation on the strength of the transfer to it of the business of the firm, and of property belonging to the plaintiff and the defendant Nichols, and until that money is returned to him it is difficult to see how the plaintiff can have annulled and set aside the transaction in which Norton advanced this money. As far as this point is concerned, it is entirely immaterial as to whether Nichols advanced the nu-ney to Norton or not. Even if 'he .did, it was Norton’s individual money, and he would be liable to Nichols for the repayment thereof. And certainly before the corporation into which he has put this money, upon the strength of the receipt of this property, can be deprived of that property, and his money rendered valueless, Norton must be reinstated in the position he occupied prior to the payment in of the money. One of the first principles in the law of rescission is that what has been received must be returned, and this seems to have been entirely lost sight of in the previous consideration of this case. . But, aside from this, no ground for setting aside this conveyance is set out in this complaint- It is manifest that the plaintiff supposed, when Norton was given the balance of power in this corporation, that he was going to use this balance of power for the purpose of keeping the plaintiff in, and he has found himself mistaken. The defendant Nichols seems to have captured the independent trustee, who alone was to look out for the interests of the corporation ; and, if the result of the continuation of the majority is that the minority must lose their control, that is only the natural result which always happens in the management of corporate affairs; the majority of the stock controls. Now it is to be observed that, as far as the defendant Norton is concerned, all the allegations in the complaint are that he was to put in $30,000 as his own individual payment. There is no allegation that he represented, or that the plaintiff supposed, that he had $30,000 of his own to put in. But the plaintiff assumes that, although Norton might borrow the'money from all the world, he was precluded from borrowing the same from Nichols ; and yet we fail to find, in all the allegations in relation to the condition of affairs upon which plaintiff alleges that he relied, that there was any representation upon the part of Norton or Nichols as to how Norton should get the money which he was to put into this corporation. The allegation that there was any relation existing between the parties which required a disclosure as to the means by which Norton was to procure the money that he was to put into this business is a clear assumption. There is nothing in the complaint which bears out any such conclusion. :

Certainly, if Norton had gone to the plaintiff to borrow this money, Nichols would have had no cause for complaint. How, then, can it be assumed that because he borrowed the money of Nichols a fraud has been perpetrated ? There is no allegation that either Nichols or Norton have done anything in the management of the business of this corporation detrimental to its interests. It is alleged that this combination between Nichols and Norton was made to take away from the plaintiff the control of the business theretofore carried on by Herter Bros., and to obtain the same himself. The complaint contains no evidence of /the carrying out of any such design; and, if it did, the plaintiff asserts the fact to be that the defendant Norton was to act as such stockholder in the interests of the corporation, and he might think such action was necessary in the interests of the corporation, and who is to dispute his judgment? It would thus appear that the whole atmosphere of the case indicates that the plaintiff was of the opinion that Norton would act in his interest, but for some reason he has concluded that he is mistaken in that regard, and that Norton will probably transfer his allegiance to the other largest stockholder in the concern. We do not see how, under such a state of facts, the plaintiff can claim to set aside a conveyance made to the corporation. The judgment should be affirmed, with costs.

O’Brien, J., concurs.


source: Caselaw Access Project

author: Vak Brunt, P. J.

license: Public Domain

text:
    Jonas H. Lane et al., Resp’ts, v. John W. Wheelwright et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    1. Attachment—Levy upon pledged property.
    Where, in levying an attachment upon the pledgors’ interest in pledged property, the sheriff did not take possession of the property, but left with the pledgee certified copies of the attachment, and notices showing the property attached, Meld, a sufficient levy upon the property.
    3. Pleading—Separate causes of action—Waiver.
    The objection that an action cannot be maintained because two or more causes of action are set forth in the complaint, and the statement of facts constituting each cause of action is not separate and numbered, as required by § 483 of the Code, is waived if not taken by answer or demurrer.
    3. Corporations—Preferences.
    The laws of New York prohibiting the transfer by a corporation of any portion of its assets to give preference to a creditor in anticipation of insolvency, do not apply to a foreign corporation.
    4.. Conflict of laws.
    There is no presumption that the statutory law of one state is the same as another, the only presumption being, where the foreign law is not proven, that the common law still exists in those countries where it obtained.
    Appeal from a judgment obtained in an action brought under §§ 655 and 677 of the Code by the sheriff, and attaching creditors of the Norton Manufacturing Company, a corporation of the state of Massachusetts, to reach certain assets of said company claimed to be in the possession of the firm of AYheelwright, Eldredge & Company, the appellants herein.
    The following is the opinion at special term:
    Truax, J. As between the plaintiffs in this action and the assignees of the Norton Manufacturing Company, I am unable to distinguish the facts of this case from the facts in the case of Warner v. Fourth Nat. Bank, 115 N. Y., 251; 26 St. Rep., 213. In that case, as in this, certain property bad been pledged. There, as here, the sheriff did not take possession of the pledged property, but left with the pledgee certified copies of the warrants of attachment, and notices showing the property attached. There, as here, the pledgor made an assignment of the property after the levies had been made upon the property under the attachments. And it was held by the court of appeals that the attachment operated to secure to the attaching creditor a lien upon the pledged property to the extent of the interest of the pledgor, and that interest was the right to the pledged property, or so much of it. or of the proceeds from any collection, as remained after the satisfaction of the pledgee’s claim for advances. It is to be noticed that the court says that the lien of the attachment is upon the “ pledged property, and not upon any indebtedness of the pledgee to the pledgor.” It, therefore, must be held in this case that the attachments were levied upon property, and not upon a debt due from the pledgee to the pledgor; and, therefore, the cases of ForeignHeld Bonds, 15 Wall., 316; Smith v. Union Bank of Georgetown,
      5 Pet, 518; Green v. Van Buskirk, 7 Wall., 139; and Henry v. Rhode Island Locomotive Works, 93 U. S., 664, are not pertinent.
    The defendants also contend that this action cannot be maintained because two or more causes of action are set forth in the complaint, and the statement of facts constituting each cause of action is not separate, and numbered, as required by § 483 of the Code of Civil Procedure. This provision of the Code relates to practice.; is a formal, and not a substantial, right. Goldberg v. Utley, 60 N. Y., 427, and is waived if not taken either by demurrer or answer. If the objection appears upon the face of the complaint, it must be taken by demurrer; if it does not so appear, it must be taken by answer; or it will be waived. Sections 488, 498, 499, Code Civil Proc.; Blossom v. Barrett, 37 N. Y., 434; Bebinger v. Sweet, 1 Abb. N. C., 266. See also Willis v. Sharp, 113 N. Y., 588; 23 St. Rep., 670; Perkins v. Stimmel, 114 N. Y., 368; 23 St. Rep., 657.
    Section 677 of the Code of Civil Procedure provides that the ■attaching creditor may bring and maintain in the name of himself and the sheriff, jointly, any action which, by the provisions of title 3, chap. 7, Code Civ. Proc., maybe brought by the sheriff, to recover property attached, or the value thereof; and the attaching creditor may, as stated above, maintain any action that the sheriff might maintain under subdivision 2, § 655, Code Civ. Pro. This section, 677, gives an attaching creditor the right to bring any of the actions mentioned in the section, and also the right to bring any of the actions mentioned in § 655. This action is, in effect, an action to recover property attached, see Warner v. Fourth Nat. Bank, 115 N. Y., 258; 26 St. Rep., 213, or the value thereof, and, therefore, may be maintained by the sheriff, or by the attaching creditor jointly with the sheriff.
    The last question to be determined is, was the property, at the time the levy was made, the property of the debtor in the attachment suit ? It is conceded that it once was the property of the •debtor, but it is claimed that the debtor, before the levying of the .attachment, sold the property. The debtor was the Norton Manufacturing Company, of Massachusetts. Charles F. Eddy was the treasurer of said company, and was also a member of the firm of Eddy & Street, which firm was a creditor of the said Norton Manufacturing Company. The sale, if there was any, was made by said Eddy’s “ transferring the account to Eddy & Street” At the time of this transfer the property was in the state of New York, and all that was in fact done was that said Eddy, as treasurer, wrote to the persons Who had possession of the goods in this state a letter directing them to transfer to Eddy & Street, and sell for their account, all goods invoiced to them by the Norton Manufacturing Company. By the laws of this state such a transfer is prohibited, and in the absence of proof to the contrary the laws of Massachusetts are presumed to be the same as the laws of this state. Hynes v. McDermott, 82 N. Y., 41. Judgment is ordered for the plaintiffs, with costs.

      H. Wallis, for app’lts; W. R. Barriklo and G. A. Clement for resp’ts.
   Vak Brunt, P. J.

This action was brought by the sheriff and attaching and judgment creditors in aid of the attachments-set forth in the complaint, and the judgments and execution issued thereon, to enforce liens claimed to have been created by said attachments, and to remove obstructions to the collection of the judgments out of the attached property. We think, for the reasons stated in the opinion of the learned judge who tried the case in the court below, that the attachments were properly levied, and that the objections to the form of the complaint were waived by not being taken by demurrer or answer. And the only question in respect to which a satisfactory conclusion was not reached was the question as to whether, at the time of the levying of the attachments, the property in question was the property of the debtor in the attachment suits. The learned judge held that the attempted transfer of the property was void because prohibited by the laws of this state, and that in the absence of proof to the contrary the laws of Massachusetts are presumed to be the same as the laws of this state; the prohibition contained in the laws of this state being against the transfer by a corporation of any portion of its property to give a preference to any of its creditors in contemplation of insolvency. Therefore, the only questions necessary for us to discuss are: Was there a transfer by the Nor-

ton Manufacturing Company, the defendant in the attachment suits, to Eddy & Street, of this property subsequently attached ? And was such transfer void because contrary to the statutes of this state ?

It appears from the evidence in this case that Mr. Eddy, of Eddy & Street, was the president and treasurer of the Norton Manufacturing Company, the defendant in the attachment suits, a Massachusetts corporation, and that the property which formed the subject-matter of the attachment was situated within this state, having been consigned to the firm of Wheelwright, Eldridge & Co., defendants herein, for sale, upon which said firm had made advances; the amount of goods being more than sufficient to pay such advances. And it further appears that the Norton Manufacturing Company being largely indebted to Eddy & Street, in July, 1888, a resolution was passed by the directors of said company, authorizing Mr. Eddy to protect Eddy & Street against any goods that were sold them in the future, and that subsequent thereto, and prior to the 19th of September, 1888, Eddy & Street had sold the Norton Manufacturing Company goods "amounting to somewhere near $5,000, and that the Norton Manufacturing Company had consigned the goods in question, as above stated, to Wheelwright, Eldridge & Co., upon which day Mr. Eddy, under the power given him, in contemplation of the insolvency of the Norton Manufacturing Company, transferred all the goods in the hands of Wheelwright, Eldridge & Co. to Eddy & Street, and Wheelwright, Eldridge & Co. were notified thereof. Such transfer took place on the 19th of September, 1888, and Eldridge was present with Mr. Eddy. Ho money passed at the time, nor was there any change in the possession of the goods. The transfer was effected by such goods being charged on the books of the Horton Manufacturing Company to Eddy & Street, and credited on Eddy & Street’s books to the Horton Manufacturing Company, and the charge to Wheelwright, Eldridge & Co. of these goods by the Horton Manufacturing Company was canceled. These entries were made by Mr. Eddy personally, no one having any authority to act but himself. It would seem that the result of those transactions was to change the title in these goods from the Horton Manufacturing Company to Eddy & Street, and that all was done which could be done to effect such transfer. The goods in question were in the possession of Wheelwright, Eldridge & Co. Heither the Horton Manufacturing Company nor Eddy & Street were entitled to the possession of the same, they being the subject of a pledge for advances made by Wheelwright, Eldridge & Co. Such being the case, unless the laws of Hew York prohibiting the transfer by a corporation of any portion of its assets to give preference to a creditor in anticipation of insolvency applied to this transfer, the title to the goods in question were in Eddy & Street. It seems to us clear that such laws do not apply to a foreign corporation. These prohibitions being statutory, and not existing under the common law, there is no presumption that the law of Massachusetts was the same as the law of Hew York; the only presumption being, where the foreign law is not proven, that the common law still exists in those countries where the common law obtained. Applying this rule to the case at bar, there was no prohibition against the Horton Manufacturing Company transfering these goods to Eddy & Street; and, in the absence of fraud, such transfer was effectual to vest the title in Eddy & Street. The judgment appealed from should be reversed, and a new trial ordered, with costs to appellants to abide event.

O’Brien and Ingraham, JJ., concur.


author: Barrett, J.

text:
    Charles H. Hyde, Adm’r, Resp’t, v. George H. Kitchen et al., Ex’rs, App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    Tiiust—Deposit in savings bank.
    In the absence of any evidence of contemporaneous facts or circumstances indicating a contrary intent, the inference must hold that a person depositing money in a savings hank, and taking a hook in his name in trust for another, intended to, and did, by such transaction create an irrevocable trust in favor of such other, and the latter’s administrator is entitled to the money so deposited.
    Appeals from two judgments entered on the decision of the court after trial of the issues at special term in actions to recover moneys deposited in the Manhattan Savings Institution of this city by Maria Van Vleck, now deceased.
    The following is the opinion at special term:
    Ingraham, J.—When the testatrix opened the account in the savings bank in question, a deposit slip was made out in the pres-

      ence of the depositor, which contained the name of the petitioner, and the names of Ada and Maria Hyde, nieces of plaintiff in this action. The bank book was also given .to the depositor at the time, on the outside cover of which was written the words: “ Mai'ia Van Vleck, in trust for Maria and Ada Hyde; ” and the account was headed: “Manhattan Savings Institution in account with M. Van Vleck, for M. and A. Hyde; and this book was delivered to the depositor, and retained by her. All of the subsequent deposits credited to this account were entered in this book at the time of each deposit by the bank officers. There is absolutely no evidence as to anything that happened at the time the account was opened, or any deposit made, that would in any way qualify the legal effect of this deposit, or show that the testatrix liad any intention contrary to that expressed by the form adopted in opening the account, and making the deposit. I do not think the subsequent declarations of the testatrix are competent evidence to show, as against this-plaintiff, that she had any other intention than that expressed by the transaction itself at the time the deposit was made; but, even if competent, I do not think they are sufficient to establish that she had any such intention. At the time the declarations were made the testatrix owned a boarding-house, and it does not appear but what she understood that this deposit really belonged to the plaintiff, or that she would have sufficient property to pay the bequest contained in her will. I think the case is clearly within the decision of the court of appeals in 'Martin v. Funk, 75 N. Y, 134, and that plaintiff is entitled to recover. The. defendants, however, are executors, and it was their duty to submit the question to be determined by the court, and, as the costs in this case are in the discretion of the court, I do not think costs should be allowed. Decision and judgment to be settled on notice.

      Thomas H. Cook (Joseph Fettretch, of counsel), for app’lt; Ladislas Karge, for resp’ts.
   Barrett, J.

The learned- judge at special term found as a fact that, in February, 1881, Maria Van Vleck deposited $170 in the Manhattan Savings Institution, in trust for the plaintiff’s intestate, John H. Hyde, who was her brother. This finding was based upon the undisputed testimony that, at the time of the deposit, a bank book was issued, and delivered to Mrs. Van Vleck, at her request, with the words, “ Maria Van Vleck, in trust for John H. Hy'de,” written upon the cover, and the words, “Maria Van Vleck, for John H. Hyde,” written within the cover. It also - appeared that the ledger account, which was then opened and kept by the bank, was in the name of “Maria Van Vleck, for John H. Hyde.” Other sums were deposited by Mrs. Van Vleck, and interest was credited to this account, from time to time, down to January, 1892, and during all that time the account continued in its original form. Mrs. Van Vleck, however, retained the bank book in her possession down to the time of her death, and the defendants, "her executors, have had it since. TjTpon this state of facts the learned judge found, as a conclusion of law, that there was an irrevocable trust in favor of John H. Hyde, and that the plaintiff, as his administrator, was entitled to the moneys in question. We think this conclusion was correct, and . we need add but little to the satisfactory reasons which the learned judge has given therefor.

The appellants concede that, if the well-known case of Martin v. Funk, 75 N. Y., 134, stood alone, they would not dispute the doctrine upon which this conclusion was arrived at. But they claim that later cases modify this doctrine, and hold that an intent contrary to that evinced by the surroundings of the original transaction may be established by later acts and declarations of the depositor, not in any way connected with the deposit. Mabie v. Bailey, 95 N. Y., 206, and Beaver v. Beaver, 117 id., 421; 27 St. Rep., 405; second appeal, 50 id., 69, are-cited as examples of the latter view. We have examined these cases carefully, but we find nothing in them to support the appellant’s contention. In Mabie v. Bailey, Judge Andrews said: “ The case of Martin v. Funk, 75 N. Y., 134, decided that a deposit made in the form of the deposit in this case constituted a trust, and, unexplained, operated to transfer the beneficial interest in the deposit to the beneficiary named, subject to the conditions of the trust to be implied from the circumstances.”

It is true that the learned judge suggested that the character of such a transaction was not conclusively established by the mere fact of the deposit, “ so as to preclude evidence of contemporaneous facts and circumstances constituting res gestae to show that the real motive of the depositor was not to create a trust” He nowhere intimated, however, that subsequent acts and declarations, not constituting res gestae, could be resorted to to show the depositor’s original intent. On the contrary, he held that the subsequent withdrawal of the deposits by the depositor was not legitimate evidence that he did not intend, when the deposits were made, to create a beneficial trust for the beneficiary named. “ It might,” he added, “ be competent evidence of a change of purpose, but it throws no light on the original transaction.” In Beaver v. Beaver there was no declaration of trust, and the case turned upon the validity of an alleged gift. Ho doubt is there expressed as to the correctness of the rule laid down in Martin v. Funk. On the contrary, that case was referred to with entire acquiescence in its trust doctrine. It was said that a declaration of trust could not be implied from a mere deposit by one person in the name of another. But it was conceded that such declaration could be implied from a deposit by one person in trust for another; and there was not a suggestion that such a trust was revocable, or that subsequent acts and declarations of the depositor, constituting no part of the res gestee, were admissible for the purpose of showing a contrary intent to that evinced by the original transaction and its surroundings. In the present case there was no attempt to vary the effect of the original transaction by contemporaneous facts or circumstances. The original transaction certainly constituted, under the rule so laid down in Martin v. Funk and Mabie v. Bailey, an unequivocal declaration of trust. Such was the inference, prima facie, at least, from the deposit in the form proved and found. Cases already cited. And see, also, Smith v. Lee, 2 T. & C., 591; Weaver v. Emigrant Industrial Savings Bank, 17 Abb. N. C., 82; Barker v. Harbeck, 17 St. Rep., 678. In the absence of any evidence of contemporaneous facts or circumstances indicating a contrary intent, that inference must hold. What the depositor may have subsequently said and done, words and acts not constituting res gestae, cannot affect the original transaction. They may show a change of purpose, but not of original intent. The evidence which was here admitted, comes within this principle, and that which was rejected was inadmissible, upon the same principle.

It follows that the judgment should be affirmed, with costs.

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


author: Van Brunt,P. J.

text:
    The Mercantile Trust Co., Resp’t, v. The Atlantic Trust Co., App’lt.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    1. Pledge—Claim by depositary op rights antagonistic to pledgee.
    An electric company guaranteed to plaintiff the payment of certain bonds of a third company, agreeing not to make any mortgage on its own property until the bonds were paid. At the same time there was deposited with the defendant trust company 30,000 shares of stock as security for the performance of the guaranty, which fact it endorsed thereon. Default was made in the payment of the bonds, the guaranteeing company refused to pay them, and plaintiff demanded of defendant the stock deposited with it, and upon refusal brought suit for its delivery. Held, that it was no defense to the action that prior to the execution of the guaranty and to the making of the indorsement the electric company had hypothecated to defendant 60,000 shares of stock, including the 30,000 mentioned in the indorsement, as security for future advances, which were made, the defendant relying on the agreement in the guaranty that no mortgage would be made on the electric company’s property, and that a mortgage of all its property had been made to plaintiff without defendant’s consent.
    2. Same.
    If the defendant, being the trustee of plaintiff, so far as the stock was concerned, claimed any interest therein which was inconsistent with the right of the plaintiff to deal with the electric company, the owner of the stock deposited, notice of such interest should have been given if it was intended to restrict the right of plaintiff so to deal.
    Appeal from interlocutory judgment sustaining plaintiff’s demurrer to one of the defenses set up in the answer of the defendant.

      North, Ward & Wagstaff (J. L. Ward, of counsel), for app’lt; Alexander & Green (W. B. Hornblower, of counsel), for resp't.
   Van Brunt,P. J.

Both parties in their pleadings have resorted to the pernicious practice which has been so often condemned by the courts, of referring to allegations in pleadings as being embraced between certain folios, which style of allegation necessarily produces the greatest confusion and uncertainty, as the folios in a printed record are entirely different from those which appear in the original pleadings. Upon an examination of the pleadings presented upon this appeal it appears that that portion of the answer which is demurred to, and which is pleaded as a further and separate defense, contains no denials, and therefore the defense is to be treated as an avoidance simply of the cause of action alleged in the complaint. Briefly stated, such cause of action is to the effect that on or about the 29th of April, 1890, the defendant, the United Electric Traction Company, duly made and delivered to the plaintiff its certain guaranty in the words and figures following:

“ For value received, the United Electric Traction Company, a corporation created and organized under the laws of the state of Uew Jersey, does hereby, for itself, its successors and assigns, guaranty to the Mercantile Trust Company, as trustee, the payment of principal and interest, at maturity, of one hundred and two (102) bonds of the Julien Electric Traction Company of $1,000 each, being numbers 1 to 30, 57 to 64, 67 to 70, 76 to 105, 110, 118,123 to 150; and the United Electric Traction Company, aforesaid, does hereby, for itself, its successors and assigns, covenant and agree to comply with all the conditions, stipulations and agreements contained in the mortgage or deed of trust executed by the Julien Electric Traction Company to the Mercantile Trust Company, trustee, bearing date June 26, 1889, and a supplemental mortgage confirming the same, bearing date October 18, 1890, to secure said bonds, more especially the requirements of said mortgage as to renewing, replacing, and keepingfin good condition all the property covered by said mortgage and said supplemental mortgage. And the United Electric Traction Company, aforesaid, does hereby, for itself, its successors and assigns, covenant, stipulate and agree that the United Electric Traction Company, aforesaid, will not make, nor allow to be made or issued, any mortgage, mortgage bonds, debentures, or any preference securities other than the $2,000,000 in preferred stock provided for in the said, the United Electric Traction Company’s articles of incorporation, until all of the said 102 bonds above referred to, both, principal and interest, shall have been paid or redeemed pursuant to the terms of said bonds.”

And that at or about the same time there was deposited with the defendant, the Atlantic Trust Company, 30,000 shares of the capital stock of the Consolidated Electric Storage Company as security for the performance of said guaranty, which said stock the said defendant, the Atlantic Trust Company, received for such purpose, and indorsed upon said guaranty its certificate as follows:

“ There has been deposited with the Atlantic Trust Co. 30,000 shares of the Consolidated Electric Storage Company’s stock," security for the performance of above guaranty.”

That since July, 1891, default having been made in the payment of the interest due upon the bonds mentioned in the guaranty, and said bonds having become due and payable, payment thereof has been duly demanded of the United Electric Traction tíompany and its receiver, which payment has been refused; and that after such refusal the plaintiff duly demanded of the defendant, the Atlantic Trust Company, that it deliver to the plaintiff said 30,000 shares of capital stock, or that it sell the same, or cause the same to be sold, and the proceeds applied to the payment of the principal and interest remaining unpaid upon said bonds mentioned in the guaranty; but said defendant, the Atlantic Trust Company, has refused to comply with either of said' demands. After an allegation as to the amount of the debt, judgment is demanded that the Atlantic Trust Company be decreed to deliver said 30,000 shares of stock to the plaintiff, or that said stock be sold under the direction of the court, and the proceeds applied to the payment of the principal and interest remaining unpaid of the bonds mentioned in said guaranty.

To this complaint the defendant, the Atlantic Trust Company, alleged by way of defense that prior to the execution of the guaranty of the United Electric Traction Company, hereinbefore mentioned, and prior to the making of the indorsement thereon that said Atlantic Trust Company had received as security for the performance of said guaranty 30,000 shares of the Consolidated Electric Storage Company’s stock, said Electric Traction Company had hypothecated to the Atlantic Trust Company, as security for advances thereafter to be made to it by the Atlantic Trust Company, its interest in 60,000 shares of the capital stock of the Consolidated Electric Storage Company theretofore issued and delivered to and then standing in the name of the Atlantic Trust Company, as trustee, 30,000 shares thereof being the shares which the. said Atlantic Trust Company acknowledged to have received as security for the performance of said guaranty ; and that the said Atlantic Trust' Company signed said acknowledgment relying upon and upon the faith of the agreement of the defendant, the United Electric Traction Company, contained in the guaranty/ that said United Electric Traction Company would not make, nor allow to ‘be made or issued, any mortgage, mortgage bonds, debentures, or any preferred securities other than the $2,000,000 in preferred stock provided for in said United Electric Traction Company’s articles of incorporation, until all the bonds referred to in the guaranty, both principal and interest, should have been paid and redeemed ; and that thereafter, and prior to the 8th December, 1890, relying upon and upon the faith of said agreement, the Atlantic Trust Company advanced and loaned to said United Electric Traction Company divers sums of money amounting in the aggregate to the sum of $190,000 or thereabouts, upon the. hypothecation to it as security for the payment therefor of the interest of said defendant, the United Electric Traction Company, in.the 60,000 shares of the Consolidated Electric Storage Company’s stock as above set forth. The defendant then alleged that on or about the 8th December, 1890, the said United Electric Traction Company, without its consent, executed to the plaintiff, as trustee, its certain mortgage or deed of trust whereby it conveyed to the said plaintiff certain specified real and personal property therein set forth to secure its bqnds tó the amount in the aggregate of $700.000, which said trust was accepted by the plaintiff, who thereafter certified $said bonds, which were thereafter issued, and are still outstanding and unpaid. To-this defense the plaintiff interposed a demurrer, upon the ground that it whs insufficient in law upon the face thereof. The ground upon which the defendant claims to uphold the defense demurred to is that the 30,000 shares of stock deposited as collateral are to be deemed a surety, and that the permitting by the plaintiff of the violation of the restrictions contained in the guaranty upon which this 30,000 shares of stock was a surety changed the position of the surety, and discharged the stock from its obligation. It seems to us that this position, which it is necessary to maintain, is' giving a personality to a thing, and a power of contract to an article of personal property, which has never yet been recognized in the law. It is treating the 30,000 shares as though it was a contracting party, whereas it was the owner of this stock that was the contracting party, and that owner, as alleged in the answer, was the United Electric Traction Company, the guarantor in the instrument which was originally given to the plaintiff. The claim is that the Mercantile Trust Company having entered into a contract with the United Electric Traction Company, and that company having deposited as collateral to such contract certain shares of stock (it is true such deposit was in the hands of the Atlantic Trust Company, but, as far as the relations between these parties were concerned, they were merely depositaries), the parties to the agreement, one of them being the owner of the stock, as far as the plaintiff knew, could not alter the terms o£ the guaranty without discharging the pledge.

It seems to us that the statement of such a proposition shows that it is not well taken. The plaintiff had no notice of the intervention of any other rights; and whether the stock was deposited with the Atlantic Trust Company or with itself as pledgee, its relations to the security were precisely the same; and it cannot be for a moment claimed that, where a pledge is in the hands of the pledgee, and the pledgor and pledgee make alterations in the terms, of the pledge, the pledgee having no notice of the intervention of any other rights, he can possibly thereby lose his lien upon the pledge. It is perfectly clear, as far as the plaintiff was concerned, that this restriction in the contract of guaranty was for its protection, and that it inured to the benefit of the plaintiff, and of nobody else. It is not even alleged that it was made for the purpose of influencing the action of the Atlantic Trust Company; and, if it had been so alleged, there being no pretense that the Mercantile Trust Company had notice of any such purpose, its rights could not be affected thereby. If the Atlantic Trust Company, being the trustee of the plaintiff, so far as this stock was concerned, claimed any interest therein which was inconsistent with the right of the plaintiff to deal with the United Electric Traction Company, the owner of the stock deposited, and who made the deposit as the owner thereof, notice of such interest should have been given if it was intended to restrict the right of the plaintiff to deal with the owner of this collateral. Wo think, therefore, that, under the circumstances, whether or not the Atlantic Trust Company made advances upon the strength of this agreement of the United Electric Traction Company with the Mercantile Trust Company not to incumber its property, such agreement not having been made for its benefit, and the Mercantile Trust Company not having consented to hold such agreement for any other purpose than its own protection, is entirely immaterial, and is a matter with which the plaintiff has nothing to do. The facts alleged in the portion of the answer demurred to, therefore, disclose no reason for a refusal to the plaintiff of the relief which it would have been undoubtedly entitled to but for the existence of such alleged facts. The judgment should, therefore, be affirmed, with leave to the defendant to .amend its answer in respect to this defense upon payment of the ■costs of the appeal and of the court below.

Follett, J., concurs.


text:
    Frederick H. Smith, Pl’ff, v. Francis W. Savin et al., Def’ts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    1. Conversion—Hypothecation op pledged stock.
    As security for any overdraft which he might make upon a banking firm, plaintiff deposited with them certain stocks, which firm wrongfully pledged with others to S. After the failure of the firm S. sold the stock without any demand or notice of time and place of sale. Held, that plaintiff, as the firm’s undisclosed principal, ratifying the unauthorized pledge of the stocks, might sue S. for conversion.

      % Same—Damages.
    In such case plaintiff could only recover the difference between the market price of the stock and the amount remaining due S. from the firm.
    8. Same.
    When a pledgee violates the terms of his pledge, and converts the pledge, the pledgor has an immediate right of possession, and an immediate right of action for the pledge, to which claim of possession the pledgee may offset the amount actually due him.
    4. Election op demedies—Amendment op complaint.
    No such doctrine as that of election of remedies can be invoked in a case where there has been but one action, and whatever change has taken place in the form of the action has been the result of an amendment to the complaint.
    Appeals by all the parties from judgment entered upon report of a referee.

      Dennison & Hall (James A. Dennison, of counsel), for pl’ff; Kenneson, Crain & Alling (T. D. Kenneson, of counsel), for def’ts Savin & Vanderhoof; Butler, Stillman & Hubbard (John Notman, of counsel), for def't Wheeler.
   Van Brunt, P. J.

This action was begun as one in equity to reach a specific fund in the hands of the defendants Savin & Yanderhoof, and was tried before a referee, and from the judgment entered upon such referee’s report an appeal was taken to the general term, where the judgment was reversed, and a new trial ordered. 30 St. Rep., 309. Subsequently, the plaintiff gave notice of motion for leave - to serve an amended complaint, which was granted upon the condition that he pay before the ■service of such amended complaint, to the attorneys of the defendants, all of their costs and disbursements, and ten dollars costs of motion, which costs were taxed and duly paid by the plaintiff. He thereupon served his amended complaint, ■ which, upon the trial of the action, was claimed to be for conversion, but to which view the pleader at the time of drawing the same did not wish absolutely to commit himself. Answers to such amended complaints were served, and the issues thus framed were referred to a referee, who reported partially in favor of the plaintiff, and from the judgment thereupon entered these appeals are taken.

In the determination of the questions involved it does not. seem to us that it is necessary to state but a very few of the facts established upon the trial, and those are substantially conceded upon the record. It appears that the defendants, Savin .& Yanderhoof, were carrying on business as stockbrokers in the ■city of Hew York, and that the firm of O. M. Bogart & Co. were also carrying on, in said city, the business of bankers and brokers. With this latter firm the plaintiff had been dealing for a number of years. Prior to and including the 1st of May, 1884, as security for any overdrafts which the plaintiff might make upon said firm, he deposited with them a large number of bonds, and a certificate for 100 shares of Missouri Pacific stock. On the 8th of May, 1884, Bogart •& Co. unlawfully, and without the knowledge of the plaintiff, pledged fifty-five United States bonds, belonging to the plaintiff, with the Central 'Trust Company of Hew York city, and received the sum of $55,-<000 from said company on the faith thereof.

On the 13th of May, 1884, Bogart & Co. borrowed on call from the defendants Savin & Yanderhoof the sum of $50,000, ■and deposited as collateral various shares of stock, including the 100 shares of Missouri Pacific stock belonging to the plaintiff, all of which stocks, except said 100 shares, were the property of Bogart & Co. Upon said day the plaintiff was apparently indebted to Bogart & Co.,for and on account of overdrafts in the sum of $43,170.79. At or prior to 10 o’clock of the 14th of May, 1884, Bogart & Co. made a general assignment for the benefit of their "creditors to the defendant Wheeler, who accepted the trust, and duly qualified as such assignee. Upon said morning, after the execution and delivery of the assignment of Bogart & Co., and after the defendants Savin & Yanderhoof had notice of •such assignment, the defendant Savin made a demand upon O. M. Bogart, Jr., who had been a clerk, but who was not a member, of the firm of O. M. Bogart & Co., for the repayment of said sum of $50,000. He made no demand upon any member of the firm, or upon said assignee. Hot receiving payment upon the demand made, and within a few minutes thereafter, he sold at the stock exchange, through private brokers, all the securities deposited with them as collateral for said loan of $50,000, which sale took place within half an hour after the return of Savin to such stock exchange rooms. Ho notice of intention to sell was served upon the firm of Bogart & Co., or upon Wheeler, as assignee, or upon the plaintiff, before such sale took place. The proceeds realized by Savin & Yanderhoof from the sale of the securities other than the 100 shares of Missouri Pacific stock, .after deducting one-sixteenth of one per cent as commissions, amounted to $45,975, and the amount due upon the loan of $50,-000 made by them to Bogart & Co. at the time of the sale was-$50,006.94. The proceeds realized from the sale of the 1001 shares of Missouri Pacific stock, after deducting one-sixteenth of one per cent, amounted to $7,343.50. In the latter part of May the plaintiff first learned that the defendants Savin & Vanderhoof claimed to have sold said stock on the 14th of May, 1884. The-value of the stock on the 21st of June, 1884, which the referee-finds to be within a reasonable time of the discovery by the-plaintiff of this sale by Savin & Vanderhoof, was $100 per share, and the referee gave judgment in favor of the plaintiff against. Savin & Vanderhoof for the sum of $5,968.06, being the difference between $10,000, the market value of said stock on the 21st. of June, 1884, and $4,031.94, the amount remaining unpaid toSavin & Vanderhoof, after the application to the debt of Bogart- & Co. of the proceeds of the sales of all the securities excepting-this Missouri Pacific stock. Prom this judgment all the parties-appeal.

The defendants Savin & Vanderhoof claim that this action, being for conversion, cannot be maintained ; that no relations existed between the plaintiff and them by which their act in selling this Missouri Pacific stock was wrongful as against him; that, whatever rights Bogart & Co. may have had because of the manner of the sale, the plaintiff was notsubrogated to any such rights, nor could he enforce the same; and that a surety (and it is sought to treat Smith as a surety because of his ownership of this stock) cannot enforce actions upon behalf of his principal. It seems tons that the true relations of the parties have been entirely overlooked by the counsel for both parties. It seems to be clear that there is no subrogation of Smith to Bogart & Co.’s rights; and that he is not by this action seeking to enforce any rights of Bogart & Co., but he is seeking- to enforce a right which accrued to-him as tire real owner of the stock pledged by Bogart & Co. The pledge by Bogart & Co., as far as the plaintiff was concerned, of' this stock as collateral to the loan of Savin & Vanderhoof, was clearly a wrongful act, for which the plaintiff could have called Bogart & Co. to account. Or he might adopt the act of Bogart & Co., which latter he has done by the action brought against Savin & Vanderhoof, because he had put it in the power of Bogart & Co. to treat this stock as their own, and procure money upon it; and by reason of the holding out of Bogart & Co. as the owners of this stock Savin & Vanderhoof, so far as they had advanced their money upon it, were to be protected, but no further. The undisclosed principal has a right to enforce the contract of his agent in respect to his property, being bound only by the contracts of that agent in respect thereto. Such being the relations-of the parties, and Savin & Vanderhoff having converted these securities, as against Bogart & Co., the plaintiff had a right to pursue Savin & Vanderhoof to procure the redress of wrongs which had been suffered in respect to that property. Bogart & Co. or their assignee would have a right of action against Savin & Vanderhoof for the conversion of these securities, among which were the 100 shares of Missouri Pacific belonging to the plaintiff. As has been said, the plaintiff had a right to adopt the contract of Bogart & Co. in respect to his property, and if Savin & Vanderhoof had broken this contract, the plaintiff, as the undisclosed principal, had a right to redress in respect to the property owned by him. He, therefore, brings this action against Savin & Vanderhoof for the conversion of this stock, it having been sold without .any demand upon Bogart & Co. for the repayment of the loan or any notice given of the time and place of sale. We have not noticed in this statement the claim in regard to the rules of the stock exchange, for they seem to be entirely immaterial.

But it is urged by the defendants that the case of Thompson v. St. Nicholas National Bank, 113 N. Y., 325; 22 St. Rep., 929, is in conflict with this view. On the contrary, it is in entire harmony with the principles here laid down, and is an authority in support thereof. In that case the court held that the bank having acted in pursuance of and under the power conferred by the -contract of pledge, it was immaterial what ulterior rights there were of which they had no notice at the time of the making of the pledge. The waiver of right of notice of the time and place of sale and personal demand was as much a part of the contract of pledge in that case as was the pledge itself, giving a right to sell; and in pursuance of the express authority conferred by the agreement of pledge the bank acted, and the court held that the sale being in accordance with the contract between the pledgee and subpledgee, it was not illegal, or in violation of the original pledgor’s rights; manifestly because the original pledgor or the owner of the stock, as against the subpledgor, could not have varied the terms of the contract by simply giving notice of ownership or interest. If there is one thing well settled it is that a bona fide holder of a negotiable security without notice is entitled to protection in everything which he gives upon the faith of the pledge; and the right to sell in a particular way or under particular circumstances is as much a part of the right secured by the pledge as the money actually advanced. Now, what were the relations between the plaintiff, Bogart & Co. and Savin & Vanderhoof in consequence of the wrongful conversion by Savin & Vanderhoof of the stock pledged by Bogart & Co. ? The plaintiff, by ratifying the pledge of Bogart & Co., had a right to maintain his action for the conversion of his property by the pledgee of his agent; and all that Savin & Vanderhoof, the'pledgees, could claim was that they should not be placed in a worse position when the undisclosed principal brought his action than they would have been had such principal not been disclosed, and the agent had brought it in his own name. If Bogart & Co. had brought this action, they probably would have been entitled to recover more than has been recovered here. At least they would have been entitled to recover the market value of this stock which had been converted, less the balance due upon the account; and that is all that the plaintiff recovered. The amount which was due upon the account was offset against the market price of the stock taken at a reasonable time after the discovery of this conversion.

But it is claimed by the defendants that at the time of this conversion the plaintiff was not entitled to the possession of the stock because the loan by Savin & Vanderhoof to Bogart & Co. had not been paid. They might have gone further, perhaps, and said, because at the time of this conversion. Bogart & Co. had a right to hold this stock because of the overdrafts of the plaintiff. But the plaintiff paid those overdrafts, and was entitled to his stock from Bogart & Co., who had wrongfully placed it in this loan. It is a familiar principle that when a pledgee violates the terms of his pledge, and converts the pledge, the pledgor has an immediate right of possession, and an immediate right of action for the pledge, to which claim of possession the pledgee may offset the amount actually due him; and even for a long period of time this-was denied him, but that seems to be the rule at the present day. Bogart & Co.’s rights seem to be beyond question, and the plaintiff seems equally entitled to enforce the lights which belong to-him because of the wrongs done to his agent in respect to his property. But it is said that in consequence of the nature of this action when it was first commenced there has been an election of remedies by which the plaintiff has lost the right to pursue this particular remedy; that, having sought originally to reach the proceeds of the sales, he adopted the sales of Savin & Vanderhoof,. and cailnot now be heard to claim that they are wrongful. Whatever might- have been the rule had two separate actions been brought, one to reach the proceeds of the sale and one for the-conversion, the first of which had proceeded to judgment, no such doctrine can be invoked in a case where there has been but one action, and whatever change has taken place has been the result, of an amendment to the complaint in that action. The amended complaint takes the place of the original complaint, and the sole action which the court has judicial notice of is the action in which the complaint exists. If the court had no power to make such amendment, or it was improper that it should have been made, that question should have been determined before the parties accepted the conditions upon which such amendment was allowed. It is too late now to appeal in this indirect manner from the order of amendment. And even a direct appeal would not lie, the defendants having accepted the costs, which were made the condition of amendment. There being but one action before the court, and one judgment, we fail to see how the doctrine of election can be invoked.

There are many facts which are stated in the findings of the referee, and also established by the evidence, which it does not seem necessary to advert to. It seems to us that those which are stated show what the relations of the parties were, and that the plaintiff had a right to maintain this action in the form into which it seems to have been converted (whether wrongfully or not is entirely immaterial upon this appeal), for the concededly wrongful conversion of the plaintiff’s securities by the defendants, Savin & Vanderhoof. It might very well be a question whether the defendant Wheeler was a necessary or proper party to the action, but, as no such question is presented, it is not necessary to discuss the same. The judgment should be affirmed, but, as all the parties are appellants, without costs.

Follett and Barrett, JJ., concur.


text:
    The Mayor, etc., of the City of New York, Resp’t, v. The New York Central & Hudson River Railroad Co. et al., App’lts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    1. Deed—Reservations in conveyance by city of land under water.
    The city of New York granted certain land under water “ except so much of the land embraced in the foregoing description as formed part ” of certain streets, “ for the uses and purposes of public streets." Held, that the fee to the parts excepted remained in the city, although never used for streets.
    2. Ejectment—Estoppel.
    The common council of New York, without the power, attempted to grant a water right on condition that the grantee build a pier. Held, that the city was not estopped from maintaining an action of ejectment to recover the land and pier.
    Appeal from a judgment awarding possession of the pier at West Thirty-ninth street, and mesne profits therefrom.

      Ashbel Green (H. R. Anderson and Herbert E. Kinney, of counsel), for app’lts; W. H. Clark (D. J. Dean and Henry B. Twombly, of counsel), for resp’t.
   Van Brunt, P. J.

This action was brought to recover land under water, forming part of what is known on the map or plan of the city of New York as “ Thirty-ninth street,” together with the pier erected thereon, and the mesne profits arising therefrom. The facts in this case are undisputed, and, therefore, only questions of law are presented. It appears that on the 16th of November, 1848, the city granted to James II. Cobb, as trustee for Sophia V. D. Laing, certain land under water, extending from high water mark to Eleventh avenue, and from the middle of Thirty-ninth' street to the middle line between Thirty-eighth and Thirty-ninth streets. From this grant was excepted so much of the land embraced within the foregoing description as formed parts or portions of Thirtj'-ninth street and Twelfth and Thirteenth avenues, for the uses and purposes of public streets, avenues and highways. In and by said grant the grantee agreed that he would, within three months next after he should be thereunto required, at his cost, build, erect, make and finish, according to any resolution and ordinance of the city of New York already passed, or that might be thereafter passed, three good and sufficient bulkheads, wharves, avenues or streets, which shall form so much and such parts of Thirty-ninth street and Twelfth and Thirteenth avenues as fall within the limits of the premises first described, and which were excepted, as aforesaid, from and out thereof, for public streets. In 1850, Cobb applied to the common council for permission to build a pier at Thirty-ninth street, and the council passed the following resolution:

Resolved, That a water grant at the foot of 39th street, N. R., be given to James N. Cobb; provided, that he shall build at his own expense a good and substantial pier at the foot of said street, under the direction of the street commissioner, the same to be -completed in one year.”

It would seem that a pier was built upon this property, and, under various mesne conveyances, whatever rights the defendants ’.had in said land were conveyed to them. In 1890 a resolution was passed by the common council revoking the authority for the maintenance of the pier in question; and this action in ejectment was subsequently brought, resulting in the judgment for the plaintiff from which this appeal is taken.

The claim of the defendants seems tobe based upon the assumption that by the grant made in 1848, as above stated, some right was conveyed to the grantee over the land upon which the pier in question, which forms the subject matter of this action, was built. This contention clearly cannot be sustained. _ The land upon which this pier was built belonged to the city of New York, and it was in pursuance of the ownership of the land under water that the grant in question was made to the grantee above named. But by this grant there was expressly excepted the soil embraced within the limits of the streets shown upon the map annexed to the conveyance. It is true that in the conveyance it was stated that such exception was made for the uses and purposes of public streets, avenues and highways; but it is entirely immaterial for what purpose the exception was made, if the land in question was not included in the grant, as clearly it was not. A grantor who states in his deed that he excepts a certain portion of the land, because he wants it for a certain purpose, cannot be held to have conveyed that which he has expressly excluded because he afterwards devotes it to a different purpose. The land in question was not included in the grant, and, therefore, no title passed. And there is no room for any claim that all that the common council reserved out of the water grant of 1848 was the right to wharfage and cranage arising from that part of the grant within the Thirty-ninth street boundaries. They actually excepted the land; did not give any title; did not intend to give .any title; and the fallacy of the defendants’ position rests upon -the assumption that only rights of wharfage and cranage formed the subject-matter of the grant of 1848, whereas it was a conveyance of land under water, the property being described as “ all that certain water lot, vacant land and soil under water to be made land and gained out of the Hudson or North river; ” and out of this conveyance is excepted the land upon which this pier was erected.

But it is said that the common council, having in April, 1850, passed a resolution that a water grant at the foot of Thirty-ninth street be given to the defendants’ predecessor in title, provided that he should at his own expense build a pier, entered into an agreement by which the corporation agreed that, in consideration of the construction of the pier, such predecessor should have a water grant, i. e'., the right of wharfage at the foot of Thirty ninth street, which was the only right retained by the city of New York in the grant of 1848. This proposition rests upon the assumption that the right of wharfage at the foot of Thirty ninth street was the only right retained by the city of New York in the grant of 1848, which we have already seen is a fallacious construction of the grant under which the defendants claim. And, furthermore, it is difficult to see how the title to real estate can be passed by resolution, the more particularly as the common council, under the ordinances which were binding upon it, had certainly no power to make any grant in the manner in which it was attempted to be done in the case at bar. The commissioners of the sinking fund have control over grants of land under water, and the provisions of the ordinances in respect to such control were in no wise complied with. The fact that under such resolution the grantee in the water grant constructed this pier, and was permitted to construct it, could not act as an estoppel upon the plaintiff. If the common council could not grant, they could not authorize an act to be done which would operate as an estoppel, because an estoppel arises only where the act is done in pursuance of an authority received from a source or permitted by a party capable of granting the right.

It is further suggested that an action in ejectment will not lie to recover an incorporeal hereditament. But the subject-matter of this action was not an incorporeal hereditament. It was the land upon which this pier stood, and the erections which had been unlawfully put upon such land; and in the case of Mayor, etc., of City of New York v. Law, 125 N. Y., 380 ; 35 St. Rep., 437, this form of action is expressly approved.

It is further urged that the court erred in directing a verdict for six years damages, as the defendants had received no notice of the revocation in April, 1890, of any rights which had been granted by the resolution of 1850. This position would undoubtedly be correct if any authority had been conferred by the resolution of 1850 which amounted to a legal license of occupapation by the person named in such resolution, of the land in question, for the purpose of the erection of a pier. It having been already shown that the common council had no power to grant this land under water, it does not seem to be necessary to repeat the argument for the purpose of showing that they had no power to dispose of the possession of the land in question for any purpose whatever. It would seem that the case of Mayor, etc., of City of New York v. Law, above cited, has disposed of all the questions involved in this case, and that no error was committed upon the part of the court.

The judgment appealed from should be affirmed, with costs.

Follett, J., concurs.


author: Per Curiam.—

text:
    Algernon O. Thayer, Resp't, v. George H. Humphreys et al., Impl’d, Appl’ts.

      (Supreme Court, General Term, First Department,

      Filed May 12, 1893.)

    Depositions—Examination before trial—Stockholders.
    In an action by a creditor of a foreign corporation to reach the amounts unpaid on subscriptions to the stock of said company, where it appears-that the information on which the action was brought was mere hearsay and an examination of the defendants is necessary to enable plaintiif to frame his complaint, an examination for that "purpose, in respect to the facts respecting the defendants’ ownership of the stock, may properly be granted.
    Appeal from an order denying a motion to vacate an order for examination before trial to enable the plaintiff-to frame his complaint.

      Sanger & Davis (Walter D. Clark, of counsel), for app’lts; Butler, Stillman & Hubbard (A. H. Van Brunt and Henry H. Whitman, of counsel), for resp’t.
   Per Curiam.—

The action was brought in equity to obtain an accounting of the amounts agreed to be paid upon certain stock subscriptions of the defendants, as stockholders in a corporation of the state of West Virginia, and that the defendants be directed to pay the balance remaining unpaid upon their subscriptions, or so much thereof as will be sufficient to pay the amount due on certain judgments obtained by the plaintiff against the company. Not having the necessary information, an application for an examination of the defendants was made, to enable plaintiff to frame his complaint. The papers upon which the original order was granted contained all the statutory allegations, and showed that the information upon which the action itself was brought was purely hearsay, and that to frame a complaint the defendants’ examination would be necessary. Upon the defendants’ motion to vacate such order it was modified so as to limit the scope of the examination to facts respecting defendants’ ownership or holding of the capital stock in the company, and whether the same is or was held by them individually, or as copartners. The rules governing applications of this kind have been so frequently stated that it is only necessary to give our conclusion. We think that the learned judge below was right in permitting an examination, and that the appellants have no just cause of complaint, in view of the limitations placed thereon. The plaintiff’s affidavits show that the application for the examination of the defendants, as limited by the order appealed from, was necessary. We think,, therefore, it should be affirmed, with $10 costs and disbursements..

O’Brien and Ingraham, JJ., concur.


author: Haight, J.

text:
    David W. Gregg, App’lt, v. William Boyd, Resp’t.

      (Supreme Court, General Term, Fifth Department,

      Filed June 23, 1893.)

    1. Lease—Right of outgoing tenant to crop.
    C. leased of defendant a farm for the term of one year, with the-privilege of three years, from the 1st day of April. The lease was in writing and contained the provision that the lessor is bound to divide the wheat he puts in over ten acres the year he leaves the farm. C. entered into possession and in October sowed about 13£ acres of wheat, and shortly after gave plaintiff a chattel mortgage of his interest therein. 0. elected not to run the farm the other years and gave notice thereof, and at the close of the year defendant took possession. In July following 0., at plaintiff’s instance, entered the premises, harvested the wheat, and stored it in the barn on the premises. Defendant refused to deliver up to-plaintiff any portion of the wheat. Held, that 111 acres of the wheat belonged to C. and the title was transferred by him to plaintiff subject to the conditions of the lease.
    2. Same.
    When the out-going tenant has the right to the away-going crop he, in contemplation of the law, retains possession of the lands upon which the crop is growing, he has the right to enter to repair fences, to protect the. growing crop, and when it ripens to harvest it.
    3. Same—Re-entry oe landlord for non-payment of rent.
    But if under the terms of the lease the landlord re-enters and takes possession for non-payment of rent, the tenant’s right to the away-going crop is lost, and neither he nor one who holds a chattel mortgage on the same can recover it.
    Appeal from a judgment entered upon a non-suit at the Livingston Circuit.

      L. O. Reed, for app’lt; J. H. Coyne, for resp’t.
   Haight, J.

This action was brought to recover the value of a quantity of wheat alleged to have been converted by the defendant.

On the 3rd day of March, 1891, one William R. Curry leased of the defendant, William Boyd, a farm for the term of one year, with the privilege of three years, from the first day of April, 1891, at the annual rent of $400.00, one-half to be paid on the first day of October and the other half on the first day of April thereafter. The lease was in writing and contained the following: “ The party of the second part is bound to divide the wheat he puts in over ten acres the year he leaves the farm.” Curry entered into the possession of the farm under the lease, and about the first of October sowed about 13|- acres of wheat, and thereafter and on the 10th day of October executed and delivered to the plaintiff a chattel mortgage covering all of his interest in the wheat. Curry elected not to run the farm for the second and third years, gave notice to that effect, and at the close of the year the defendant took possession, and leased it to another person. On the first day of October Curry paid upon the rent then due $197.00. He did not pay the instalment falling due at the end of the year. In July following, at the instance of the plaintiff, he entered the premises, harvested the wheat and stored it in the barn on the premises. The defendant thereupon took possession of the wheat, threshed it, and upon demand of the plaintiff, made upon his chattel mortgage, which he then had present and read to the defendant, he refused to surrender the wheat or any part thereof. Upon the trial evidence was given on behalf of the plaintiff to the effect that the former tenant had the same quantity of wheat growing upon the place, and that it was understood between Curry and the defendant that Curry should have one-half of all the wheat harvested over ten acres ; that the former tenant came upon the p'remises during Curry’s term, harvested the wheat, put it in the barn, threshed it, and took it all away without giving him any portion thereof; that on complaining to the defendant of this conduct, the defendant told him to put in just the same number of acres that the former tenant had in and it would be all right, “ that he could take the crop oS that he put in.” This evidence was controverted by the defendant.

It is claimed that upon the surrender of- the premises by Curry at the end of the year the wheat then growing upon the premises became the property of the defendant. Wood, in his work on Landlord and Tenant, at § 558, says, “ The right which an outgoing tenant has to take an away-going crop, which is the crop sown during the last year of his tenancy, but not ripe until after the expiration of it, is sometimes given to him by the express terms of the lease or agreement, and sometimes by the custom of the country. Such custom, or more properly speaking usage, has been held to be reasonable and valid,and to apply equally to tenants by oral agreement, or by writing, or even by deed. Such a custom is good and just and for the benefit and encouragement of agriculture, for that it is but reasonable that he'who sows should reap the profit.”

But we do not in this case understand that the rights of the parties are dependent upon a custom of the country, for it appears to us that they are disposed of by the terms of the lease. As we have seen, it contains the provision that “ the party of the second part is bound to divide all the wheat he puts in over ten acres the year he leaves the farm.” This provision inferentially contemplates the sowing of the wheat upon the farm and the gathering of the same. The lease ended on the 31st day of March, 1892. Wheat sowed in the fall would not mature until the following July. Ten acres is to be the tenant’s; all over that amount was to be divided between the landlord and tenant. The fair and reasonable construction to be placed upon this provision is that the tenant should have the right to harvest the same, and that it remained his with the exception of the part over ten acres which was to be divided with the landlord. If this provision was modified by the oral agreement referred to, then it would all belong to the tenant and the landlord would have no interest therein. It consequently appears to us that the wheat belonged to Curry and that the title was transferred by him to the plaintiff under the mortgage referred to subject to the conditions imposed in the lease.

Was this wheat surrendered to the defendant at the termination of the lease ? Boyd testified that Curry told him he might come and take possession of the premises ; that he did take possession and relet the farm. Curry testified that he never had any conversation with the defendant on the subject of surrendering the thirteen acres of wheat to him ;■ that there was nothing said on that subject except that he elected not to go on another year on the farm. We do not think the court upon this evidence alone would be justified in holding that there was a surrender. The most that can be claimed for it is that it raised a question of fact for the determination of the jury. Wood’s Landlord and Tenant, § 499. But there is another question which appears to us to dispose of the case, and to sustain the court in its direction of a non-suit. Curry in his testimony conceded that he had not paid all of the rent due under the lease; that he had paid only the sum of $197.00. There was, therefore, due on the first day of April, $203.00, which was not paid. The lease contained a provision that in case the tenant should fail to pay the rent, or any part thereof, the defendant might re-enter the premises. The defendant did re-enter and now claims that he re-entered the whole of the premises because of the non-payment of the rent, and that he had the right so to do under the lease. When the out-going tenant lias the right to the away-going crop he, in contemplation of the law, retains possession of the lands upon which the crop is growing; he has the right to enter to repair fences, to protect the growing crop, and when it ripens to harvest it. In other words, he has the custody and control of it and retains the possession of the lands for that purpose But if he surrenders the possession of the farm, including that upon which the crop is growing, or if he is ousted from the same by judicial proceedings, or if under the terms of his lease the landlord re enters and takes possession of the same, the tenant’s right to the away-going crop is lost, and neither he nor his mortgagee can recover the same. If summary proceedings should be instituted to remove the tenant for the nonpayment of rent during the term, and he should be removed under a judgment entered in such proceedings, he could not thereafter re-enter the premises for the purpose of gathering maturing crops, and if the landlord re-enters under a power given in the lease we fail to see how the situation would be changed, or the right of the tenant would be different from that where the reentry was made under a judicial decree. In either case the possession is taken of the whole premises, including that upon which crops may be growing.

Before summary proceedings can be instituted to recover the possession of leasehold premises on account of the non-payment of rent, at least three days notice in writing requiring the payment of rent and the possession of the premises must be served. Code Civ. Pro., § 2231.

But when six months rent is in arrear upon a grant reserving rent, or upon a lease of real property, and the grantor or lessor, or his heir, devisee or assign, has a subsisting right by law to reenter for the failure to pay rent, he may maintain an action to recover the property granted or demised without any demand of the rent in arrear or re entry on the property. Code Civ. Pro., § 1504.

As we have seen, the first instalment of rent became due on the 1st day of October; $197 only was paid. A portion of the instalment remained owing from that date,- which was more than six months before the re-entry was claimed to have been made by the defendant. He, therefore, had the right to maintain ejectment without demand of the rent in arrear. Samson v. Rose, 65 N. Y., 411-419.

And if he could re-enter peaceably no action was necessary.

In Bliss v. Johnson, 73 N. Y., 529-534, Andrews, J., in delivering the opinion of the court, says: “ The true owner of land wrongfully held out of possession may watch his opportunity, and if he can regain possession peaceably, may maintain it, and lawfully resist any attempts by the former occupant to re-take possession; nor will he be liable to be proceeded against under the statute of forcible entry and detainer. There can be no wrongful detainer by the true owner when the entry was both lawful and peaceable.” McAdarn on Landlord & Tenant, § 104; People v. Fields, 1 Lans., 241-244; Mussey v. Scott, 32 Vt., 82;. Sharp v. Kinsman, 18 S. C., 108.

In Abrahams v. Tappe, 60 Md., 317, it was held that a mortgagee of leasehold interest takes it subject to the conditions and covenants of the lease, and where the rent had been allowed to remain for more than one year, and the landlord having by reason of that default, and in the assertion of his right, secured actual and peaceable re-possession of the premises, the lease became absolutely forfeited, and the mortgage, so far as it affected the premises, fell with it.

In 2 Platt on Leases, 331, it is said: “ On re-entry the lessor is entitled to the emblements, and notwithstanding his taking advantage of the forfeiture, he retains unprejudiced any right of action that he may have for breaches of covenant committed by the lessee previously to the re-entry."

In Fry & Co. v. Ford, 38 Ark., 246, it was held that, “ When a tenant abandons his crop and fails to perform the terms of his lease, the landlord may gather the same and retain as against the tenant’s mortgagee of the crop the expenses of preserving and gathering it, as well as the rent remaining unpaid.”

In Davis v. Eyton, 7 Bingham, 154, a lease had been granted on condition that if the lessee contracted a debt on which he should be sued to judgment, which should be followed by execution, the lessor should re-enter as of his former estate. The lessor having re-entered after judgment and 'execution; it was held that he was entitled to the emblements. See, also, Debow v. Colfax, 5 Halsted, 128 ; Smith & Soden’s Landlord & Tenant, 290.

The case of Duffus v. Bangs, 122 N. Y., 423 ; 34 St. Rep., 222, is not in point. In that case the landlord, before re-entry, had told the owner of the nursery stock that he might enter upon the premises in the spring and remove the same. The owner of the nursery stock relied upon this promise and did not remove it until the following spring, and it was held that, under such circumstances, the landlord was estopped from claiming ownership of the stock.

The judgment should be affirmed.

Dwight, P. J., Lewis and Macomber, JJ., concur.


author: Dwight, P. J.

text:
    Marcus Hirshfield, Pl’ff, v. Maria Ludwig, Josiah Sullivan, Resp’t, John H. Foley, App’lt, et al., (2 cases).

      (Supreme Court, General Term, Fifth Department,

      Filed June 23, 1893.)

    1. Assignment—Orders drawn on particular fund.
    An order drawn on a particular fund named therein has the efEect of an assignment pro tanto of that fund, and binds it in the hands of the drawee from the date of the presentation or notice of such assignment, whether the fund was in the hands of the drawee at the time of notice of the order or came into his hands thereafter, and the drawee becomes primarily liable to the payee for the amount of the order as in the case of acceptance.
    S. Same.
    In such case, it is immaterial at what time the order was actually paid, and the drawee is entitled to maintain his lien by virtue of any security he holds therefor from the date when the indebtedness thus becomes his own.
    Appeal by the defendant Foley from an order of the County ■Court of Monroe County, in each action, which confirms the report of a referee and directs the distribution of surplus moneys arising on a sale in foreclosure.

      Geo. Truesdale, for app’lt; H. W. Morris, for resp’t.
   Dwight, P. J.

There were, two mortgages made by the ■defendant Ludwig to the plaintiff on several premises on Colvin street, in the city of Bochester. The foreclosure of the first mortgage produced a surplus of $575.15 ; of the second a surplus of $540.15. The controversy here is between the two defendants, Sullivan and Foley, in respect to the priority of their respective liens, both having been made defendants as lienors subsequent to the plaintiff. The referee to whom - the matters in difference in this proceeding were referred found and reported that the defendant Sullivan had liens by virtue of two mortgages on the premises in question to the amount of $1,286.50, which were prior and superior to the liens of the defendant Foley. The county court modified the report by striking out a single item of the defendant Sullivan’s claim, which, however, did not reduce that claim below the total amount of the surplus moneys in hand, confirmed the report as so modified, and ordered the whole amount of surplus •moneys, after providing for the expense of the proceeding, to be paid to the defendant Sullivan. It is from that order in each action that this appeal is taken.

The liens of the defendant, Sullivan, were by virtue of two mortgages of $500 each, executed by the defendant Ludwig to , him on the same parcels of land respectively as those covered by the plaintiff’s mortgages. They were executed respectively on the 10th and 11th days of October, 1890, and were duly recorded— the former on the 11th and the latter on the 13th day of the same month. They were given as general security for whatever sums might be or become due from Mrs. Ludwig to Mr. Sullivan.

The liens of the defendant Foley were for materials sold by him to Mrs. Ludwig and employed by her in the erection of buildings on the same lots, to the amount of $300 on each lot. His notices of lien were filed on the 16th day of October, 1890.

The defendants Sullivan and Foley. filed the only notices of claim to the surplus moneys in question, and were the only parties represented on the reference herein.

The indebtedness of Mrs. Ludwig to the defendant Sullivan arose by way of advances made by him to her, or for her benefit, in connection with building operations other than those which gave rise to Foley’s mechanic’s liens. She had procured loans; from two loan associations in Rochester to the net amount of $4,-270.75, on lots other than those covered by the plaintiff’s and Sullivan’s mortgages. Mr. Sullivan was the attorney for both of these associations and the money loaned by them was put into his hands to be advanced to Mrs. Ludwig as the buildings on the lots-covered by their mortgages should progress to completion. On the 13th day of October, 1890, the entire net avails of these loans had been thus advanced to and for Mrs. Ludwig, and in addition thereto the sum of $390.50 from Mr. Sullivan’s own funds ; and on and before the 24th day of November he had made further advances to the amount of $100, under an express agreement of Foley that it should have precedence as alien, under the Sullivan mortgage, to the mechanic’s lieu of Foley. This made the sum of $490.50 for which the lien of Sullivan’s was, unquestionably, superior to that of Foley under his notice as a material man.

The sole question in the case relates to the effect of certain orders which were drawn by Mrs. Ludwig on the funds in Sullivan’s hands before the time when the liens of Foley attached^ though not paid until after that time.

The facts bearing upon this question are that on the 24th day of June, 1890, Mrs. Ludwig drew on Mr. Sullivan, in favor of a firm of lumber dealers, an order for the payment of $468.50, to be charged against the avails of the loan of the Monroe Avenue Association ; and on the 23rd day of August another order in favor of the defendant Foley, himself, for $537, payable out of the fund arising from the loan of the Park Avenue Association. She also drew an order in favor of a firm known asYogel & Binder, for $275, which was in general terms, and not payable out of any particular fund. Sullivan paid all three of these orders at dates varying from May to August, 1891. The referee classed the Yogel & Binder order with the other two, and gave to it the same effect in determining the amount of Sullivan’s lien. The county judge, on the other hand, distinguished it from the others by the fact that it was not drawn against a particular fund. The question need not be discussed here, because to exclude the third order still leaves the amount paid by Sullivan on the other two in excess both of the surplus moneys upon which he asserts a lien and of the two mortgages upon which his lien is based.

Upon these facts we concur with the learned county court in the conclusion that the defendant, Sullivan, was entitled to a lien in preference to that of the defendant, Foley, to the full extent of the two mortgages held by the former. The ground of this conclusion, as already foreshadowed, is that each of the two orders-first mentioned, being drawn upon a particular fund named therein, had the effect of an assignment pro tanto of that fund, and bound it in the hands of the drawee from the date of the presentation or notice of such assignment, Brill v. Tuttle, 81 N. Y., 454; Lauer v. Dunn, 52 Hun, 191; 23 St. Rep., 374; S. C., 115 N. Y., 405 ; 26 St. Rep., 412 ; that such was the case whether the fund was in the hands of the drawee at the time of notice of the order, or came into his hands thereafter; that in either case the drawee became primarily liable to the payee for the amount of the order as in the case of acceptance; that it is immaterial at what time-the order was actually paid and that the drawee is entitled to maintain his lien by virtue of any security he holds therefor from the date when the indebtedness thus becomes his own. These propositions seem to result necessarily from the doctrine of the cases cited, and they lead to an affirmance of the order appealed from.

Order of the county court of Monroe county appealed from, affirmed, with costs.

Lewis, Macombeb and Haight, JJ., concur.