text:
    Eugene A. Brewster, Ex’r, etc., Appl’t, v. Spencer Carnes et al., Resp’ts.

      Court of Appeals,

      Filed December 7, 1886.

    1. Mortgage-assignment of—Recording of, not of itself notice to a MORTGAGOR, HIS HEIRS OR PERSONAL REPRESENTATIVES, 1 R. S., 763, § 41.
    Under the Revised Statutes, the recording of an assignment is not of itself, notice of such assignment to a mortgagor, his heirs or personal representatives, so as to invalidate any payment made by them, or either of them, to the mortgagee.
    2. Same—What persons not within the provisions oe the act.
    The provisions of the act do not apply where the party making payment is the purchaser of the equity of redemption.
    3. Same-Is a conveyance within the meaning of the recording ACT.
    It is a well established principle that the assignment of a mortgage, and the satisfaction of the same are conveyances within the meaning of the recording act. The record of an assignment of a mortgage is constructive notice to all persons of the rights of the assignee, save as excepted by-statute.
    4. Same—When recorded, the failure of the assignor to produce BOND AND MORTGAGE ON PAYMENT IS NOT MATERIAL.
    In a case where constructive notice of an assignment is given by the recording thereof, the effect of the failure of the assignor of the mortgage who has received payments thereon subsequent to the assignment, to produce the bond and mortgage at the times of payment is not material.
    5. Same—Attorney—Authority to receive interest is not authority to receive principal —Creditor not bound to show withdrawal OF PAPERS from attorney.
    Authority given to an attorney to collect "the interest on a mortgage does not authorize payment of the principal to him. It is incumbent on the debtor, who makes a payment to an attorney to show that the securities were in the attorney’s possession on each occasion when the payments were made, and it is not incumbent on the creditor to show notice to the debtor of the withdrawal of the papers from the possession of the attorney.
    Appeal by plaintiff from a judgment of the supreme court, general term, fifth department, entered upon an order which affirmed a judgment of foreclosure and sale entered upon report of a referee in favor of the plaintiff.1
    Calvin Dodge and wife, on March 10, 1868, executed to Philip Verplanck, as trustee for Mary A. Miller and John B. Miller, infants, a mortgage on lands situated in Cattaraugus county, which was recorded March 30, 1868. James W. Taylor, succeeding Verplanck as trustee for the infants, received as such an assignment of the mortgage, dated August 2, 1869, and recorded February 12, 1873. He, by an assignment, dated June 28, 1877, and recorded July 14, 1877, assigned the mortgage to Mary A. V. Webster, formerly Mary A. Miller, one of the cestuis que trust, who subsequently by an assignment- dated August 24, 1878, and recorded August 24,1883, assigned the mortgage to this plaintiff. The debt secured by the mortgage originally amounted to $4,000, but at the time of the assignment from James W. Taylor to Mrs. Webster, in 1877, all had been paid, except a balance of $1,000. Upon the assignment, Taylor delivered to Mrs. Webster the bond and mortgage which have since been in the possession of the plaintiff, her attorney. Taylor was, however, permitted to collect the interest, hut was not authorized to receive any part of the principal. In an action brought to foreclose the mortgage, the only defendant answering was Spencer Carnes, who obtained title to the premises covered by the mortgage through a sheriff’s deed, dated March 27, 1875, and recorded March 30, 1875. He sets up as a defense payment to Taylor, in January, 1880, of the balance of the principal due.

      E. A. Brewster with L. S. Sterritt, for app’lt; G. S. Van Gordes, for r'esp’ts.

       Reversing 38 Hun, 636, mem.

   Miller, J.

Under the Revised Statutes (1 R. S., 763, § 41), the recording of an assignment of a mortgage is not, of itself, notice of such assignment to a mortgagor, his heirs, or personal representatives, so as to invalidate any payment made by them or either of them to the mortgagee.

The section of the statute above cited cannot be said to apply to the facts which are presented for consideration in the case under advisement, as is apparent from a careful reading of the same.

The defendant who made the payment was not the mortgagor, nor his heir, nor his personal representative. He was the purchaser of the equity of redemption, and became seized of the premises subject to the mortgage. He was not, therefore, a party named in the statute, or from its phraseology intended to be embraced within its terms. If the statute was designed to include a purchaser of the mortgaged premises, it no doubt would have so stated and thus made it manifest that such was its intention.

Nor was the payment made to the mortgagee, the party named, but to a third person, who claimed to act for the owner of the mortage, without any authority at any time receive payments upon the principal.

It would seem, therefore, that the statute cited does not embrace any such case as is presented by the evidence here, and if the payments made can be upheld it must be upon some other and entirely different ground.

This is sought to be done, and reliance is placed upon Jones, Mort., § 791, and Heermans v. Ellsworth (64 N. Y., 159), which, it is claimed, bear upon the construction which is given to section 41 of the statute.

In Jones on" Mortgages the notice, it is said, must be given to the owner of the equity of redemption in order to protect the assignee against payments made in good faith by the mortgagor or the party liable to pay the mortgage, to the assignor; that the recording of the assignment is not of itself such notice of the assignment as will afford such protection. This dictum would seem to be in direct conflict with the general rule relating to the effect to be given to the assignments of mortgages when placed on record and to conveyances to subsequent purchasers of the mortgaged premises who take title subject to the mortgage. It is a well established principle of law that the assignment of a mortgage and the satisfaction of the same are conveyances within the meaning of the recording act. Van Keuren v. Corkins. 66 N. Y., 77; Westbrook v. Gleason, 79 N. Y., 25 ; Decker v. Boice, 83 N. Y., 215 ; Bacon v. Van Schoonhoven, 87 N. Y., 446.

Taylor, to whom the payments in controversy were made by defendant Carnes, was the owner of the mortgage and assigned the same to Mrs. Webster, which assignment was recorded on the 14th of July, 1877. This was before the payment from Carnes to Taylor in 1880 was made, and was a notice to all subsequent purchasers or incumbrancers of the mortgaged property, and to all persons who might afterwards nave any dealing with Taylor in regard to the mortgage.

Carnes, in making payments on the mortgage after the recording of the assignment, was a purchaser subsequent to Mrs. Webster whose title, by virtue of the assignment, was previously recorded.

Under the recording act, therefore, Carnes was chargeable with notice that the mortgage, which he intended to pay, had been assigned by Taylor to another party, Mrs. Webster, who subsequently assigned her rights "therein to the plaintiff.

The record of an assignment of a mortgage is constructive notice to all persons of the rights of the assignee save as excepted by the statute. Viele v. Judson, 82 N. Y., 32.

In the case cited it is laid down in the opinion by Finch, J., that the recording of an assignment furnishes protection against any subsequent assignment of the same mortgage, or any unauthorized discharge, and is notice that the rights of the mortgagee are gone and that' he can neither assign nor discharge the instrument. That case is directly in point and very distinctly covers the question presented. The record of the assignment here, as in the case cited, was an ample protection to the plaintiff’s claim, and notice to Carnes that Taylor had disposed of his interest in the mortgage. .

In Heermans v. Ellsworth (supra), the action was upon a demand against the defendant for money loaned by the plaintiff’s assignor, and it was held that it is the duty of an' assignee of a non-negotiable chose in action, in order to protect himself against payment by the debtor to the original creditor, to notify the former of the assignment, and that in an action upon the demand where such a payment is established, the burden of proving notice prior to payment is upon the plaintiff.

No question arose as to the constructive notice or the effect of the Recording Act; and the case cited, therefore, is not in point.

Inasmuch as, upon the recording of the assignment, Carnes had constructive notice thereof, it is not material whether he had notice otherwise sufficient to put him upon inquiry that Taylor had ceased to be the owner of the mortgage. It may be remarked, however, that ■ before the assignment of the mortgage by Taylor to Webster the receipts were signed by Taylor individually, and subsequent to the assignment they were signed by him as attorney for the mortgagee, thus disclosing to and notifying the defendant that Taylor had ceased to be the owner of the mortgage, and that he only acted as attorney for the owner. Having this information it would seem to have been the duty of the defendant to have made further inquiry as to the ownership of the mortgage before making payments.

As to the claim of the defendant’s counsel that the omission of Taylor to produce the bond and mortgage, when Carnes made payments thereon, does not, in this case, show that Carnes had no right to make such payments to him— it may be remarked that if constructive notice was given of the assignment by the recording thereof, then it is not material to discuss the effect of Taylor’s not producing the bond and mortgage. If, however, any question can arise as to the non-production of the bond and mortgage, it is a complete answer to the position taken, that although Taylor had authority to collect interest, such authority did not authorize him to receive the principal.

This was held in Smith v. Kidd (68 N. Y., 130), where it is said in the opinion by Rapallo, J., that it is incumbent on the debtor who makes a payment to an attorney to show that the securities were in the attorney’s possession on each occasion when the payments were made, and that it is not incumbent on the creditor to show notice to the debtor of the withdrawal of the papers from the possession of the attorney.

Under these circumstances there is no ground for claiming that plaintiff is estopped from denying the right of Taylor to receive the principal due upon the mortgage.

There is no foundation for the position that Taylor, as agent, had any authority from the plaintiff beyond that which authorized him to receive the interest, or that the plaintiff was chargeable with negligence in his failure to give notice to the defendant Carnes that he was the assignee of the mortgage.

As the referee erred in his conclusion, and the general term in affirming his judgment, the judgment should be reversed and a new trial granted, with costs to abide the event.

All concur, except Huger, Ch. J., not voting.


source: Caselaw Access Project

author: Per Curiam.

license: Public Domain

text:
    Agnes E. Abel, ex’rx, etc., App’lt, v. President of Delaware and Hudson Canal Co., Resp’t.

      (Court of Appeals,

      Filed December 7, 1886.)

    1. Negligence—Railroad—Master and servant.
    The plaintiff’s testator was a ear repairer in the employ of the defendant, and while under one of its cars standing upon a side track engaged in making repairs, its employees using an engine carelessly backed a car against it, and thus he came to his death. There had been no special rule promulgated for the government of the employees and the safety of repairmen: Held, that whether other rule promulgated were sufficient to protect the repair-men was for the jury, and that a non-suit was error.
    2. Same—Duty of master to promulgate rules for protection of SERVANTS.
    The law imposes upon a railroad company the duty to its employees of diligence and care, not only to furnish proper and reasonably safe appliances and machinery and skillful and careful co-employees, but also to make and promulgate rules which, if faithfully observed, will give reasonable protection to the employees.
    Appeal from a judgment of the supreme court, general term, third department, and from a motion for a new trial on exceptions heard in the first instance at general term. A non-suit was granted at the circuit.

      Nathaniel C. Moak, for app’lt; L. B. Pike, for resp’t.

       Reversing 38 Hun, 641, mem.

   Per Curiam.

The plaintiff’s testator was a car repairer in the employ of the defendant, and while under one of its cars standing upon a side-track, engaged in making repairs, its employees using an engine, carelessly backed a car against it, and thus he came to his death. The principal claim on the part of the plaintiff is that the evidence tended to show that the defendant had not made and promulgated proper rules for the government of its employees, and hence its negligence in that respect should have been submitted to the jury. The law imposes upon a railroad company the duty to its employees of diligence and care, not only to furnish proper and reasonably safe appliances and machinery, and skillful and careful co-employees, but also to make and promulgate rules which, if faithfully observed, will give reasonable protection to the employees. Slater v. Jewett, 85 N. Y., 61; Besel v. New York Cent., etc., R. Co., 70 id., 171; Sheehan v. Same, 91 id., 339; Dana v. Same, 92 id., 639.

It appears that the managers of some railroads^ in this country have adopted a rule substantially like this : “A blue flag by day and a blue light by night, placed in the draw-head or on the platform or step of a car at the end of a train, or car standing on a main track or siding, denotes that the car-repairmen are at work underneath. The car or train thus protected must not be coupled or moved until the blue signal is removed by the repair-men.” This is certainly a very efficient rule, and, if faithfully and carefully observed, would give reasonable protection to repair-men.

The plaintiff contends that it was, under the circumstances of this case, a question for the jury to determine whether the defendant, for the protection of its repair-men, engaged in a peculiarly hazardous work, should not have promulgated such a rule, or one substantially as efficient. The only rule the defendant had made bearing upon this case was as follows: “ A red flag by day, and a red lantern by night, or any signal violently given, are signals of danger, on perceiving which the train must be brought to a full stop as soon as possible, and not proceed until it can be done with safety.” This rule seems, from its phraseology, to have been mainly, if not exclusively, intended for the government of moving trains, and was not very well adapted for the protection of men under stationary cars upon side tracks engaged in making repairs. There was no rule prohibiting the removal of the signal, and the signal was not intended exclusively for the. protection of such men, nor did it give notice that human life was in danger. It matters not that there was a custom or rule among the repair-men in the employ of the defendant at Mechanics-ville that they should place a red flag at each end of the cars which they were repairing. It does not appear that that rule was regularly promulgated by the defendant, or that obedience to it was required by the defendant; nor does it appear that it was printed, or generally known to the engineers engaged in running trains. It appears that it was a common and frequent occurrence for engines and cars to be switched upon the side tracks at Mechanicsville without any check or hinderance from any one having control of the tracks at that place, and thus the repair-men engaged under and about the cars seem to have been exposed to constant peril. We do not perceive how it was possible to say, as a matter of law, that the rules of the defendant were proper and sufficient for the protection of its repair-men, and that it should not have taken greater precautions, by rules or otherwise, for their safety. We think the facts should have been submitted to the jury, and that the non-suit was improper.

The judgment should be reversed, and new trial ordered, costs to abide event.

All concur, except Earl, J., not voting, and Miller, J., taking no part.


author: Rapallo, J.

text:
    People ex rel. Mary R. Bush et al., Resp’ts, v. John R. Brown, App’lt.

      (Court of Appeals,

      Filed December 7, 1886.)

    Appeal—Habeas corpus—Judgment—Jurisdiction.
    The general term on reversing an order at special term dismissing a writ of habeas corpus directed a new hearing'on the writ at special term. On the r hearing the special term remanded to the possession of the relator the infant, to obtain the possession of which the proceedings were brought. A motion was mad : at special term to set aside this order, and on denial and appeal to the general term was affirmed. Upon appeal to the court of appeals: Hell, that the appeal could not be entertained. That it was within the discretion of the court below whether they should set aside the order or leave the appellant to set up the invalidity of the order whenever an attempt should be made to enforce it against him.
    Appeal from an order of the supreme court, general term, second department, affirming an order of the special term, denying appellant’s motion to set aside a former order of that court awarding an infant to the custody of relators on the ground that the court had no jurisdiction to make such order.

      E. H. Berm, for app’lt; John A. Deady, for resp’ts.
   Rapallo, J.

This appeal is brought upon the theory that the general term, on reversing the order at special term dismissing the writ of habeas corpus, had no jurisdiction or power to direct a new hearing on the writ at special term, and that consequently the order made at special term on the rehearing, remanding the infant, Francis 0. Brown, to the custody of the relators, was without jurisdiction and void. On that ground the appellant moved, at special term, to set aside last-mentioned order, and his motion having been denied, and the denial affirmed at general term, he now appeals to this court.

We are of opinion that the appeal cannot be entertained. Even if it should be assumed that the order which the appellant sought by the motion to set aside was made without jurisdiction and was void, the appellant would not have an absolute right to demand that it be set aside on motion. It was within the discretion of the court below whether to grant that relief, or to leave the appellant to set up the invalidity of the order whenever an attempt should be made to enforce it against him, or to obtain any benefit thereunder. No appeal, therefore, lies to this court from a refusal by the court below to set aside such an order on motion. This precise point was decided in the case of Foote v. Lathrop (41 N. Y., 358), and has been affirmed in several subsequent cases.

The appellant was constrained to base his motion, as he did, on the ground that the orders were absolutely void, because, if they were not void, but simply erroneous, his remedy was by appeal, and not by motion to set aside.

The appeal should be dismissed, with costs.

All concur.


author: Earl, J.

text:
    J. Smith McMasters, App’lt, v. State of New York, Resp’t

      (Court of Appeals,

      Filed December 7, 1886.)

    1. Statute of limitations—When it commences to bun against the STATE.
    Where the assignor of the plaintiff entered into a contract with the duly-appointed managers of the Buffalo State Asylum to furnish certain materials and labor for the construction of said asylum according to plans that had been duly agreed upon. And these plans for the buildings under which the contract was entered into had not been altered by any act of the legislature. Held, that neither chapter 323, Laws 1874, nor chapter 264, Laws 1875, abrogated or repudiated the contracts of the managers. That the breach of said contract did not occur until the contractor was notified to stop furnishing the materials and labor; and that the statute of limitations began to run against the contractor from the date of that notification.
    2. How IT SHOULD BE PBOVED.
    When the state interposes the defense of the statute of limitations, it should establish it with reasonable clearness and certainty.
    3. Laws—Constbuction—When they act betbospectively.
    Unless the very plain meaning of the language requires it, laws should not be so construed as to have retrospective operation, or to affect existing contracts or acts already done.
    Appeal by the claimant from an order of the board of claims of the state of New York, dismissing a claim for breach of contract.

      J. F. ParJchurst, for app’lt; D. O'Brien, attorney-general, for resp’t.
   Earl, J.

In 1870 the legislature passed the act,-chapter 378, “to establish and organize the Buffalo State Asylum for the Insane.” The governor was authorized to appoint, by and with the consent of the senate, ten managers for the asylum, who, among other duties, were to procure plans, designs and specifications for the construction of the necessary buildings, and to contract for the construction of the same, providing such plans, designs, specifications, contracts and the terms thereof, should be approved by the governor, state engineer and comptroller, and further provided that the managers should not adopt any plans for the buildings nor alter or change the plans adopted without the assent of the state officers named. In pursuance of the act the governor appointed the managers, and they prepared plans,' designs and specifications which were approved by the state officers. The plans provided for a central building and five connecting male wards upon one side designated A, B, C, D and E, and five female wards upon the other side designated by the same letters, and several outbuildings.

The managers afterward advertised for bids for furnishing the dimension stone and block work required for the buildings, and for the cutting of the same, and the firm of Peck & Co. were the lowest bidders for such materials and work, and the managers thereupon awarded the contracts for the materials and work to that firm at the prices bid for them, and the contracts were afterward duly and formally executed. From time to time during the years 1871, 1872, 1873, 1874, 1875, and until the month of May, 1876, the firm furnished upon the asylum ground dimension stone and blocks, and cut and prepared the same, and such materials were measured and accepted by the supervising architect 0and superintendents, and used in the construction and completion of certain of the buildings referred to in the contracts, drawings, plans and specifications. On the 25th day of May, 1876, the managers passed the following resolution:

“Resolved, that the plans of both ends of the asylum buildings, so far as they refer to wards C, D and E, be so modified as to permit the same to be constructed of brick with sandstone trimmings instead of stone entirely, and that the plans when so modified be presented to the proper state officers for their approval as required by law. On the ,7th day of July, 1876, plans in accordance with this resolution were approved by the proper state officers, and on the seventeenth day of August were finally adopted by the managers. This change in the plans was made without the consent of Peck & Co., but they furnished and cut whatever stone was required from time to time by the managers and building superintendent to be furnished for the construction of the buildings according to such modified plans, and received compensation in full for such materials and work. At the time of the passage of the resolution above set forth, the walls of the central building and male wards A and B were completed according to the original plans, but the walls of the male wards 0, D and E were not then built, and they were subsequently in 1876 and 1877, prior to the fifth day of, November in the last year, built according to the modified plans. At the last date the managers passed the following resolution:

“Resolved, that the building superintendent notify Peck & Co. to remove the stone belonging to them from the asylum grounds within ten days from the time they receive such notification from the building superintendent.” Such ; notification was given on the next day, and thereafter the contractors were not permitted to furnish more stone or further to perform their contracts. The female wards have never been constructed, and the buildings have been recognized as completed.

In the year 1881 the claim of Peck & Co. for damages for alleged breach of their contracts on the part of the state was duly assigned to this claimant; and in the month of January, 1882, he duly executed, verified and presented to the state board of audit his petition setting forth the particulars of his claim and praying for the allowance thereof. That petition was pending and undetermined before the board of audit and was by law transferred to the board of claims when that board was constituted in 1883.

The claim was brought to a hearing before the board of claims and it found among other things, that Peck & Co. sustained damages from the breach of the contracts on the part of the state, but dismissed the claim on the sole ground that it. was barred by the statute of limitations; and whether it was so barred or not is the sole question for our determination.

It is claimed on behalf of the state that the contracts were abrogated by the acts, chapter 323 of the Laws of 1874, and chapter 264 of the Laws of 1875, and that the breach of the contracts was not later than the date of the passage of the last act, which was more than six years before the presentation of the claim to the board of audit.

On the other hand the claimant contends that the breach which gave his assignors a cause of action was not earlier than the 25th day of May, 1876, within six years before the presentation of the claim.

The act, chapter 323 of 1874, appropriated for the Buffalo State Aylum for the Insane, to be expended only for the completion of the buildings already commenced, the sum of $150,000. This provision in no way interfered with the contracts. It simply directed how the money thus appropriated should be used, and in no way worked a repudiation of the contracts.

The act also contained the following provision: “The governor is hereby authorized to appoint two superintending' builders to take charge of the following buildings in process of construction, namely: the Buffalo State Asylum for the Insane, the State Reformatory at Elmira, the Hudson River State Hospital for the Insane at Poughkeepsie, and the State Homeopathic Asylum for the Insane at Middletown, to superintend the construction and completion thereof. The persons appointed under this provision shall be vested, so far as the construction of said buildings is concerned, with all the duties, powers and responsibilities heretofore imposed or conferred upon the commissioners or managers heretofore appointed to take care of such buildings, respectively, which said commissioners and managers are hereby superseded as to the powers and duties herein referred to. The purchasing of the materials and all things connected with the erection of said buildings shall be done by contract, and a11 contracts shall be awarded to the lowest responsible bidder after being advertised as is now-required by law for the advertising and letting of state work on the canals. ’’

This provision did not entirely supersede the managers appointed under the act of 1870, but substituted in their stead (only so far as concerned the construction of the asylum buildings) two superintending builders. It did not alter the plans for the buddings, nor expressly abrogate or repudiate any contracts which "the managers had entered into for the construction of the buildings. It cannot be inferred, from the language used, that the legislature meant to abrogate valid existing contracts and thus leave the state liable for damages for their breach.

The contracts of Peck & Oo. covered only a portion of the material and work required for the buildings; and, as the act of 1870 did not require that contracts should be let at a public bidding, this act required that contracts should be so let, and all its language can have full force by confining it to future contracts. It looked to the future, and did not purport to, interfere with what had already been done with materials already purchased, or valid contracts already made in the very mode it prescribed.

Suppose the contracts had been relet at a lower price; the diminished price might at least measure, though not necessarily limit, the damages of Peck & Co. caused by the breach of their contracts, and the state would gain nothing. The construction contended for on behalf of the defendant, so unjust to the contractors and injurious to the state, should not be adopted unless required by the plain meaning of the language used, and we think is inadmissible.

That the statute of 1874 cannot be so constmed is made more manifest by reference to the act of 1875, which, it is also contended, abrogated the contracts. Section 1 of that act provides as follows:

“The governor is hereby authorized to appoint three building superintendents, of practical experience, who shall respectively have charge of the construction of the Hudson Eiver State Hospital for the Insane at Poughkeepsie, and the State Homeopathic Asylum for the Insane at Middle-town, and the Buffalo Asylum for the Insane. The purchasing of the materials and all things connected with the erection, of -new building, and the labor upon the same, shall be done by the managers thereof by contract; and contracts shall be awarded to the lowest responsible bidders, after being advertised in the state papers and in at least two paper published in-the locality where the work is to be done, once in each week for four weeks consecutively, immediately preceeding the letting of said work; which notice of letting, to be signed by the managers, shall state the work to be let, the quantity and quality of materials to be bid for and the length of time which will be given for the completion of the work or the delivery of the materials, the amount of the security required, bonds to be furnished for the. faithful performance of the contracts. Before said work and' materials shall be advertised and let by the man- . agers aforesaid, full detailed plans arid specifications of said work shall be made and approved of by the lieutenant-governor, attorney-general and comptroller of the state, in writing, and said plans and specifications thus made and approved shall not be altered without the consent and approval, in writing, of the lieutenant-governor, attorney-general and the comptroller. The contracts for such labor and materials shall be made by the managers aforesaid after the approval of the lieutenant-go.vernor, attorneyfeneral and comptroller, in writing, indorsed thereon, after aving been furnished by the said managers with the bids for said work and materials, which shall be filed by the comptroller in his office.”

For the same reasons before stated in reference to similar language used in the act of 1874, this section must be held to have reference to future contracts in the construction of the buildings; and all its language can have effect by confining it to such contracts.

It would be quite preposterous to suppose that the legislature meant by this section to abrogate, not only all the contracts existing prior to the act of 1874, but all the contracts let in pursuance of that act and expressly authorized thereby; and yet the act would have to receive such a construction if the act of 1874 were construed as it is claimed it should be on behalf of the defendant. That is, if the act of 1874 abrogated all the contracts theretofore made, then the act of 1875 abrogated all the contracts made before its passage. It is plain that both acts were concerned with.the future and had reference to future work and materials and future contracts.

It is a fundamental rule, founded in wisdom and. sound public policy, that uriless the very plain meaning of the language requires it, laws should not be so construed as to have retrospective operation, or to affect existing contracts or acts already legally done.

This obvious construction of the two acts is one that all the persons connected with the construction of the buildings understood and acted upon. The managers and superintending builders all recognized these contracts as subsisting; and the contractors continued to perform them long after the passage of these acts; and-it does not appear that anyone, prior to the hearing of this matter before the board of claims, ever claimed that these contracts were abrogated or broken by these acts.

The cases of Lord v. Thomas (64 N. Y., 107) and Danolds v. State (89 id., 36), are in no way in conflict with the views here expressed. They involved the construction and effect, beside the provision above quoted from the act of 1874, of the following clause therein: “For the State Reformatory

at Elmira, the sum of $300,000, provided the plans of the building be so changed as to render such sum sufficient to complete the center building and the south wing so as to receive convicts; such changes of plans to be approved of and certified by the governor and comptroller.”

A superintending builder was appointed and the plans were so changed as to make the contract which had previously been entered into wholly inapplicable, and the contractor was absolutely prohibited from the further performance of his contract, and under such circumstances it was held that the contract had been abrogated and broken.

Here the plans were not changed and were not ordered to-be changed by either of the acts, and there is nothing from' which an intent to abrogate the contract can be justly inferred.

We have reached this conclusion without considering the allegations of the claimant: that the state, subsequently to 1875, recognized and ratified the contract as valid and sub-sisting, and also that it became estopped from denying the validity and continued existence of the contracts subse-' quently to that time, by virtue of the judgment against it' in the action brought by it against Peck & Co. to recover back money paid under the contracts.

We. have confined our attention to the one point: the statute of limitations, upon which the board of claims based • its decision. The case was settled and prepared to present that point alone, and it would not be proper to consider any other.

In conclusion we repeat, as peculiarly applicable to this case, what was said in Corkings v. State, 99 N. Y., 499, “When the state has no better or other defense than the statute of limitations it should at least, both upon the law and the facts, establish that defense with reasonable clearness and certainty.”

The decision of the board of claims should be reversed and a new hearing ordered, costs of this court to abide events.

Ruger, Oh. J., Raparlo and Finch, JJ., concur; Dan-forth, J., dissents; Andrews and Miller, JJ., not voting.


author: Danforth, J.

text:
    George W. Conselyea, and another, Ex’rs, etc., Resp’ts, v. Francis Swift, App’lt.

      (Court of Appeals,

      December 7, 1886.)

    1. Trial—Right to open and close—Belongs to party holding the AFFIRMATIVE.
    One cause of action alleged in the complaint makes out a perfect case upon a promissory note against the defendant, as indorser, and the answer" denies none of the plaintiff’s allegations, -but sets up affirmatively that the defendant was an accommodation, indorser, and that the note was paid out of moneys in the hands of plaintiff’s testator appli-" cable thereto, and adds, on information and belief, “thatthe said plaintiffs are not the lawful owners and holders of said note, and that he is not indebted to them thereupon in any sum whatever.” Held, that this was not a denial of any averment contained in the complaint; that, the whole burden of proof lay upon the defendant, and that he had the right to open and close the evidence. .
    3. Complaint—Allegations not controverted by answer to be taken as true—Code Civ.- Pro., § 523. . .
    Code Civil-Procedure, section 522, requires each material allegation in the complaint not controverted by the answer to be taken as true.
    Appeal by defendant from a judgment entered on an order of the general term of the supreme court of the sec-. and. department, affirming a judgment after trial at the King’s county circuit.
    The seventh cause of action was thus stated in the complaint.
    “And for a seventh and further separate cause of action against said defendant upon information arid belief these plaintiffs respectfully allege:

      “First. That at the city of Brooklyn, on or about the 1st day of May, 1882, one George Swift made his certain promissory note in writing whereby for value received he. promised to pay to the order of himself, one month after the date thereof at the First National Bank, the sum of five thousand eight hundred and twenty-five dollars ($5,825).

      “Second. That thereafter the- said George F. Swift duly indorsed and delivered the same so indorsed.
    . “ Third. That thereafter the said defendant above named duly indorsed the said note and "delivered the same so indorsed. '

      “Fourth. That thereafter and before maturity and for value said note lawfully came to the possession of one William Conselyea.

      .“Fifth. That when said- note became ■ due-and payable, the same .was.duly presented, -for payment at the place-where the same was made payable, and payment thereof -demanded, which was refused, whereupon the same was duly protested- for non-payment, at an expense to said William Oonselyea of one dollar and twelve cents ($1.12), of all of which due notice was given to the defendant above named.”
    ' The answer to this cause of action was as follows:
    “And further answering the said complaint the defendant says that the note mentioned and described in the •seventh cause of action therein was made by George Swift for the purpose of raising money, and the same was indorsed by this defendant at the request of the said George Swift "without any consideration and for the purpose of enabling the maker to raise money thereon, and the said William ■Oonselyea thereafter, well knowing the premises, indorsed said note for the purpose aforesaid, and this defendant avers on information and belief that it was then and there agreed by and between the said George Swift and the said William Oonselyea, that the said note was to be paid by the said George Swift out of the avails of a certain contract which the said George Swift then had with the city of Brooklyn, and that an order upon the proper office of the city to pay the amount of said note out of the moneys coming due to said Swift on said contract should be made by him in writing and should accompany and be delivered with the said note to the First National Bank, Brooklyn, to which said note was to be presented for discount, and that under no' circumstances should this defendant be chargeable as indorser upon said note or otherwise with the payment thereof by the said William Oonselyea or the said George
    ' “And this defendant further says on information and belief, that said note was thereafter accompanied by the •order aforesaid, duly discounted by the said bank and the proceeds thereof used for the purpose of said contract, and that before the said nóte became due, the said William Oonselyea, who was theretofore and up to that time interested with the- said George Swift in the contract aforesaid, took from the said George Swift an assignment thereof together with the moneys due and to grow due thereon, it being understood and agreed' between them that such assignment was subject to the order which accompanied the note aforesaid for the payment thereof, and that the said note should be paid out of the moneys which should fall due under said contract, after said assignment, the same as if said assignment had not been made, and as if the moneys so falling due should become due to said Swift instead of the assignee thereof aforesaid.
    “That said note was subsequently paid at maturity out of moneys, which fell due under said contract or was paid by the said Coriselyea out of his own funds, he taking to himself the moneys applicable to and appropriated for the payment thereof, out of said contract as aforesaid.
    “And this defendant says on information and belief as aforesaid, that said plaintiffs are not the lawful owners and holders of said note, and he is not indebted to them thereupon in any sum whatever.”

      James Troy, for app’lt; J. Stewart Boss, for resp’t.

       Reversing 39 Hun, 656, mem.

   Danforth, J.

The complaint contains seven causes of action. As to the first six no question arises. The seventh makes out a perfect case upon a promissory note against the-defendant as indorser, and the answer denies none of the plaintiffs’ allegations, but sets up affirmatively that the defendant was an accommodation indorser, and that the note was in fact paid out of moneys in the hands of the plaintiffs’ testator applicable thereto. The defendant adds, upon information and belief, “that the said plaintiffs are not the lawful owners and holders of said note, and that he is not indebted to them thereupon in any sum whatever.” This clause is relied upon by the respondent as an answer to the appeal. It is not sufficient. It is not a denial of any averment. Neither of the facts so controverted are alleged in the complaint. It is merely an affirmative statement of a conclusion drawn from the preceding new matter in the answer; and, while it might have been omitted as wholly unnecessary, it put in issue no part of the plaintiffs’ case. The whole burden of proof lay upon the defendant, and without evidence the plaintiff was entitled to a verdict. Fleischmann v. Stern, 90 N. Y., 110.

The learned counsel for the respondent has placed upon his points cases from other states. We do not refer to. them, for our own Code is upon this subject very explicit, and requires each material allegation, in the complaint, not controverted by the answer, to be taken as true. Section 522. In this case, as before suggested, no allegation is denied. It was therefore for the defendant to. establish the-defense set up, and as he thus held the affirmative, he had the right to open and close the-evidence; and the learned trial, judge erred in ruling to the contrary.

The judgment appealed from should therefore be reversed,, and a new trial granted, with costs to abide the event.

All concur, except Ruger, C. J.,' and Finch, J., not. Voting. .......'


author: Earl, J

text:
    Nathaniel R. Denton, John Baird and others, App’lts, v. George W. Sanford and Andrew J. Mapes, Ex’rs, etc., Resp’ts.

      (Court of Appeals,

      Filed December 14, 1886.)

    1. Executor and administrator—Trustee—When entitled to complete testator’s contract.
    Testator, previous to his death, foreclosed a mortgage upon premises situated in New Jersey, and bid in the property for $11,000, but before the sale was consummated and the deed given he died. After his death the executors were called upon to complete the sale and pay the purchase price, which they did, After trying to sell the property for several years the executors conveyed it for $6,000, taking back two mortgages for the full amount of the purchase money. In said mortgages certain moneys held as trust funds under the will were invested. The executors rendered a final account after citations personally served upon the petitioner herein. Upon that accounting it appeared that all the legacies had been paid except those represented by the mortgage. A decree was entered settling and allowing the accounts as filed and approving the investment of the trust money and discharging the execuiors. Subseq iently it turned out that, unknown to the executors, and probably also to the testator, there was a defect in the title to the real estate. And the mortgagor ceasing to pay the interest, the mortgage was foreclosed and only $2,300 was realized, which the trustees (the same persons who had been executors) accounted for. In a suit to make the trustees personally liable for the deficiency in the trust fund: held, that the executors having acted in good faith in completing the contract of purchase of the testator must be assumed to have been bound to perform the contract. They were not obliged to wait until it was enforced against them by legal proceedings.
    2. Same—Must not invest in mortgages on property out op the state—When exceptions to rule.
    While it is a general rule that an executor or trustee residing in this state and deriving his authority from a will executed and admitted to probate here cannot invest trust funds in mortgages upon real estate situated out of the state; yet that rule has some exceptions, and the investment in this case comes within the exceptions to the rule.
    3. Same—When decree op surrogate final.
    The decree of the surrogate upon the final accounting of the executors (after citations personally served upon all the parties interested) furnishes absolute protection to them so long as it remains unimpeaclied and in force.
    Appeal from a judgment of the supreme court general term, second department, affirming an order of the surrogate of Orange county, dismissing the petition as to ail the petitioners who appeared herein.

      Benjamin Low, for app’lts; F. V. Sanford, for resp’ts.

       Affirming 39 Hun, 487, mem.

   Earl, J

Samuel Denton died April 7, 1874, leaving a will in which these respondents were appointed executors, and leaving personal estate inventoried at about $48,000, but actually worth much less. He gave legacies to various persons, and created trusts and made these respondents trustees of $3,000, and ordered the interest to be paid annually to. Nathaniel R. Denton, and at -his death the principal sum'to be divided between his children; of $1,000, and ordered the interest to be paid annually to John Baird, and at his death the principal sum to be -divided between his children, and he also made them trustees of $500, for the benefit of George W. Denton.

Previous to his death he held a mortgage upon premises situated in the state of New Jersey, and he there commenced a foreclosure of that mortgage in the court. of chancery, and obtained a judgment for foreclosure, directing, a sale of the mortgaged premises. In pursuance of that judgment, the premises were sold, and bid off for the testator by his attorney for the sum of about $11,000, which was the amount of the prior liens and incumbrances upon the premises, together with the costs of the foreclosure; but before the sale was consummated, and the deed given, die died. After his death the executors were called upon to complete the sale, and pay the purchase price, and on the 8th day of June, 1874, they took the deed in their individual names, but for the benefit of the estate. All this they did acting in good faith, under the advise of counsel, and in the exercise of reasonable prudence and care. They held this real estate until April 2, 1877, in the mean time renting it, and making diligent efforts to sell it; and, having failed in such effort's/bn'that day they conveyed it'to John Burt for-$6,000, and on the,same day he conveyed it to Mary IP. Maples, and .she executed to Burt two mortgages,-—a first mortgage to secure $4,500, and a second one to secure $1,500, of the purchase money.' The' mortgage for $4,500 was assigned tb" the' 'executors as trustees-for the security, and as an investment-of the funds belonging to the three-' trusts above mentioned.

. Subsequently, to that date the..executors rendered a final account of their proceedings, after citations personally served - upon all - these -petitioners.. - -Upon.. that accounting it appeared that they had paid all' the legacies except those invested in and represented by the mortgage .for $4,500, and another trust of $1,500, and the surrogate made a decree in which-he adjudged that the" account of the executors should be finally settled and allowed, as filed and adjusted; and the decree recited further as follows: “And, it further appearing that said executors have the sum of $6,000, invested on bond and mortgage for the following persons:' The sum of $3,000 for said Nathaniel R. Denton, the sum of $1,000 for John Baird, the sum of $500 for' George W. Denton, and the Sum of $l,500- fór the said---Emily Conklin/ and it further appearing that said legatees Nathaniel R. Denton, John Baird, and George W. Denton claim interest on their respective legacies from the date of the'death of said Samuel Den-ton, which occurred on the 7th day of April, 1874; and after hearing the respective counsel in this matter, and due deliberation being had thereon, it is ordered, adjudged and ■decreed that said executors pay to Nathaniel E. Denton the interest on his said legacy of $3,000, from April 7, 1874, being the sum of $210; and that they pay to John Baird the interest on his said legacy of $1,000, for the same period of time, being the sum of $70; and that they pay to the general guardian of said George W. Denton the interest on his said legacy of $500, for the like period of time, being the sum of $35,—said interest amounting, in all, to the sum of $315, and for which amount said executors are credited in the foregoing statement;” and it was further decreed that the executors, upon complying with the terms of the decree, should be discharged. Thereafter interest on the two mortgages was regularly paid, down to the first day of April, 1882, and paid over to the persons entitled thereto under the various trusts and the decree of the surrogate. Subsequently it turned out that, unknown to the executors, and probably also to the testator, there was a defect in the title to the real estate, and in consequence thereof the mortgagor ceased to pay the interest upon the mortgage for $4,500, and it was foreclosed by the executors; and there was realized upon such foreclosure, after deducting the costs and expenses of the same, nearly $2,300, for which they have accounted. After that time no interest was paid to these petitioners, and they filed this petition in the surrogate’s court calling the trustees to account for the money invested in the New Jersey real estate, and asking that they be made personally liable for any deficiency in the trust fund.

There is nothing in the proof or the findings of the surrogate impeaching the perfect good faith of the executors in all their transactions. The testator having bid off the real estate in New Jersey, and as we must assume, having become personally obligated to pay his bid, and to perform his contract of purchase, these executors representing his estate were bound to perform that contract. They were not obliged- to wait until it was enforced against them by legal proceedings, but they had the right voluntarily to discharge the obligation which their testator had incurred.

It matters not that they paid the money and took the deed before they had qualified as executors. After they had qualified they could- ratify what they had previously done, and thus make that legal which was before illegal. They cannot be charged with a devastavit in talcing money of the estate before they had received their letters, and acting in good faith, and with what then appeared to be reasonable prudence, _ using it to discharge an obligation apparently valid-' resting upon their- testator.- They thus found themselves with this land belonging to the estate situated in the state of New Jersey. They sold it for the best price they could obtain, which was, without their fault, much less than cost. Having paid ah the legacies which were due and payable, and which they were bound to discharge in cash, they took the two mortgages for $6,000; to represent the trust funds which they held. The mortgage for $4,500, in which these petitioners were interested, was apparently adequate security.

While it is a general rule that an executor or trustee residing in this state and deriving his authority from a will executed and admitted to probate here, cannot invest trust funds in mortgages on peal estate situated out of the state, yet as stated in Ormiston v. Olcott (84 N. Y , 339), that rule is not universal and has some exceptions. There Finch, J , said: ‘1 The rule should not be made arbitrary and inflexible, and so rigid as to admit of no possible exceptions, for it is merely an outgrowth or consequence of the broader and admitted proposition that the duty of a trustee in making investments is to employ such diligence and such.prudence as in general prudent men of discretion and intelligence _ in such matters employ in their own like affairs. While, therefore, we are not disposed to say that an investment by a trustee in another state can never be consistent with the prudence and diligence required of him by the law, we still feel bound to say that such an investment, which takes the trust fund beyond our own jurisdiction, subjects it to other laws and the risk and inconvenience of distance and of foreign tribunal, will not be upheld by us as a general rule, and never unless in the presence of a clear and strong necessity or a very pressing emergency.

We think this investment comes within the exceptions of the rule. Here was land belonging to the estate and the trustees sold it. Not being able to obtain cash, they took a first mortgage, which was supposed to be ample security to represent the trusts. They did not take available funds, and carry them out of the state and there invest them in real estate, but they invested thé trust funds which regularly and legitimately came to them, upon land belonging to the estate which they sold, and we cannot say that it was a breach of duty on their part so to invest them; and if there were nothing more in the case, the loss upon thé investment, however disastrous to these petitioners, could not be cast upon the trustees.

But we think, also, that the decree of the surrogate: upon the final accounting of the executors furnishes absolute protection to them. These petitioners were parties to that accounting, and it does not appear that any objection was there made to the-payment of $11,000 in discharge, of the testator’s bid, or to the mortgage of $4,500, taken in part to secure the two sums of $3,000 and $1,000, in which the petitioners were interested. Upon that accounting the executors were charged with the whole amount of the inventory, and with the increase thereof, and they were credited by loss on the inventory, by expenses and legacies paid, and by $6,000 invested in these two mortgages; and it appears in the decree that the $6,000 included the trust funds in which these petitioners are interested. That decree, which has never been impeached or reversed, finally settled and allowed the accounts thus presented. So long as it remains in force, none of the parties thereto can object that the $11,000 was not properly paid for the real estate in New Jersey; that the two mortgages, amounting to $6,000, were not properly taken; or that the mortgage for $4,500 did not represent the two trust funds in which the petitioners claim an interest. Code, § 2742; In re Tilden, 98 N. Y., 434; In re Hawley, 100 N. Y., 206.

We are therefore of opinion, upon both grounds, that the decision of the surrogate was right, and that the judgment of the general term should be affirmed, with costs.

All concur, except Finch, J., not voting.


author: Finch, J.

text:
    Eli W. Blake, Resp’t, v. Chester Griswold, App’lt.

      (Court of Appeals,

      Filed December 14, 1886.)

    Appeal—Reargtjment—death of party at time of appeal is not GROUND FOR.
    On a motion for reargument of an appeal. Held, that an affidavit showing that when the appeal was argued and decided, plaintiff was dead, furnished no ground for reargument.

      Wm. C. Holbrook, for app’lt; A. Pond, for resp’t.
   Finch, J.

This is a motion for a reargument. So far as our conclusions are criticised, nothing more need be said. The suggestions made are not at all new or outside of the consideration already given to the case. But an affidavit is presented showing that, when the appeal was argued and decided, the plaintiff was dead. The facts seem to have been suspected by, though not certainly known to, some of the counsel, but, at least, were not disclosed to the court. It will necessarily furnish a ground for some motion to be made in the case, but certainly furnishes none for a re-argument. Until steps are taken for a proper substitution, the questions thence arising and now suggested are not before us, and the motion made is not in order. If we might treat those questions as presented informally, by the consent to a substitution contained in the plaintiff’s brief, we could only do so by assuming that the person who claims in a letter to be administrator is such, and then disposing of the question of abatement raised upon the printed arguments without hearing counsel orally. We prefer that the questions involved should be raised in some regular and orderly manner, not likely to lead to further complications.

The motion should be denied.

All concur.


text:
    Thomas Anderson, ex’r, etc., of John Anderson, deceased, Resp’t, v. Barbara Goldsmidt, substituted as defendant, App’lt

      (Court of Appeals,

      Filed December 17, 1886.)

    1. Insurance (life)—Assignment of policy taken on life of husband for benefit of wife—Laws 1879, chap. 348.
    On May SI, 1879, the G. L. Insurance Co. issued to B. G. an endowment policy on the life of her husband, payable May 31, 1885, or within sixty days after due notice and proof of his death should he die before that time. The policy provided that in case of her dying before her husband, the amount of the insurance should be payable after her death to her children. On February 15, 1881, B. G. and her husband united in a written assignment, signed by them, of all their right, title and interest in and to the policy to J. A. The policy having matured, the plaintiff as executor of J. A. began an action to recover the amount of the policy from the company, claiming under the assignment. An order was made substituting B. G. as defendant, and the money paid into court. Laws 1879, chapter 248, provide: “All policies of insurance heretofore or hereafter issued within the state of New York upon the lives -of husbands for the benefit and use of their wives, in pursuance of the laws of this state shall be * * * assignable by said wife, with the written consent of her husband. Held, that by uniting with his wife in the assignment he consented thereto in writing.'
    3 Same—Contingent right of beneficiary.

      Held, that the fact that .the wife had children at the time she executed an assignment, did not render her assignment void. The statute gave to the wife the absolute power to assign or surrender the policy. The children had a contingent interest in the policy, which would have become vested in case the wife had died before the policy matured.

      James D.:Bell, for app’lt; C. L. By on, for resp’t.

       Affirming 38 Hun, 360.

   Earl, J.

On the 31st of May, 1810, the Germania Life Insurance Company issued to Barbara Goldsmidt an endowment policy upon the life of her husband, Joseph Goldsmidt, for $1,000, payable May 31, 1885, or within 60 days after due notice, and proof of his death, should he die before that time. The policy, among other things, provided that, “in case of the death of the said Barbara Goldsmidt before the decease of the said Joseph Goldsmidt, the amount of said insurance shall be payable, after her death, to her children, for their use, or her guardian, if under age; or, if she shall have no children, to her executors, administrators and assigns.” On the 15th of February, 1881, Barbara Goldsmidt and Joseph, her husband, united in a written assignment, signed by them, of all their right, title and interest in and to the policy to John Anderson. The policy matured on the 31st of May, 1885, and, said John Anderson having died, the plaintiff, as his executor, began an action to recover the amount of the policy from the insurance company, claiming under the assignment of the policy to his testator. An order was made substituting Barbara Goldsmidt as defendant, and the fund was deposited in court. She answered, setting up that the assignment was void, because she was a married woman, with children having an interest in the policy, and because the assigmnent was not executed in conformity with the statute. A judgment for the plaintiff having been affirmed by the general term, the defendant has appealed .to this court, and attempts to sustain her appeal upon the two grounds mentioned in her answer.

.It is provided, in chapter 248, Laws 1819, that “all policies of insurance heretofore or hereafter issued within the state of New York upon the lives of husbands for the benefit and use of their wives, in pursuance of the laws of the state, shall be, from and after the passage of this act, assignable by said wife, with the written consent of her husband, or, in case of her death, by her legal representatives, with the written consent of her husband, to any person whomsoever, or be surrendered to the company .issuing such policy, with the written consent of the .husband.”

Objection is made that there was not in this case, within the meaning of this statute, the written.consent of the husband to this assignment. But, by uniting with his wife in executing the assignment, he consented thereto in wilting, and it would be taking a very narrow view of the statute, quite inadmissible, to hold that the purpose of the statute was not fully answered by the execution of the assignment in that way.

The mere fact that she had children at the time she executed the assignment did not render her assignment void. The statute, whether there be children or not, gives • the wife, with the consent of her husband, the absolute power to assign or surrender the policy. It is quite true that the children had a contingent interest in the policy, which would have become vested in case the wife had died before the policy matured. But here she survived that period, and hence the contingency did not arise which gave the children any interest whatever in the policy. At the time of this assignment there was no law and no public policy which prohibited the wife from ássigniñg any interest which she had ,in the policy; and,by the. assignment which she executed plaintiff’s testator became vested with the entire interest in the policy, and there is no defense to the plaintiff’s claim to the amount due thereon. The judgment should be affirmed.

All concur.


text:
    Charles Schwartz et al., App’ts, v. William K. Soutter et al., Resp’ts.

      (Court of Appeals,

      Filed December 7, 1886.)

    1. Assignment for benefit of creditors—Void fob preferences— Limited partnership.
    An assignment for the benefit of creditors made by a limited partnernership containing preferences is void under 3 R. S. [7th ed.1, 3338, §§ fcO, 81.'
    3. Same—When second assignment valid.
    Hence, when a limited partnership after having made an assignment which was void by reason of containing preferences, an assignment made three days thereafter, in compliance with Laws of 1877, chapter 466, section 1, was valid and conveyed the title to the property embraced therein to the assignee, and an attachment issued to a creditor of the partnership on the ground that by the first assignment the members of the partnership had assigned the property with intent to hinder, delay and defraud creditors and to give preferences, is not maintainable,
    Appeal from an order of the supreme court, general term, first department, reversing an order of the special term denying a motion to vacate an order.
    On September 28,1885, the defendants, who were general partners in a limited partnership, made a general assignment for the benefit of their creditors containing preferences, which was recorded on the day following. The assent of the assignee was not embraced in or indorsed upon the assignment before the same was recorded, as required by the act of 1877, chapter 466, section 1. Upon the day of the record this omission was discovered and an assent, dated September 28, and acknowledged on the 29th, was separately recorded about an hour and a half after the assignment itself had been recorded. It also appeared that the firm finding itself insolvent sent for its counsel and was by him advised to make an assignment; and acting on his advice they executed one in good faith and without intent to hinder, delay or defraud any of their creditors or the plaintiffs herein, and without being aware that such assignment was contrary to law. The assignment contained preferences to two persons to whom the firm was indebted.
    It also appeared that before any act was done under the assignment defendants’ counsel discovered that the firm of Soutter & Co. instead of being a general partnership was a limited one, and included Timothy H. Porter as special partner; and thereupon, on October 1,1885, another assignment was duly executed, acknowledged and recorded containing no preferences, which recited the true nature of the partnership and embraced in it the assent of the assignee. Under this last assignment the assignee filed his bond and schedule, treating the former assignment as a nullity. On the 30th of December, or nearly three months after the recording of the last mentioned assignment, the plaintiff's procured a warrant of attachment on an affidavit stating that said firm become insolvent on the 28tli day of September, 1885, and that “the defendants Soutter and Edwards, with intent to hinder, delay and defraud the creditors of said limited partnership, and of giving a preference to .two certain creditors hereinafter named, assigned all the property and assets of said limited partnership,” etc. The defendants moved to vacate it, upon the affidavit of the defendant Edwards, the two assignments and the papers upon which the attachment was granted. The motion was denied. From the order of denial defendants appealed to the general term, which reversed the order and granted the motion: “Upon the ground that the assignment of September 28, 1885, was void in law and passed no title to the assignee, because the consent of the assignee was not embraced in, or at the end of, or indorsed upon the assignment before the same was recorded, as required by section 1, chapter 466, Laws 1877. And the subsequent ass;gnment, executed October 1, 1885, and in compliance with the statute, no rights having intervened, was valid, and conveyed the title to the assignee named, of the property embraced within it, no evidence existed of any fraudulent intent in fact.” From this order the plaintiffs appealed to this court.

      Eugene Smith and John H. Miller, for app’ts; Delos McCurdy, with Messrs. Vanderpoel, Oreen &. Cumminq, for respt’s.

       Affirming 2 N. Y. State Rep., 633; 41 Hun, 323.

   Per Curiam.

Under the provisions of the Revised Statutes (3 R. S., [7th ed.) 2238, §§ 20, 21), the assignment of September 28, 1885, was void’for the reason that it contained preferences. The assignment of October 1, 1885, was therefore valid. Upon this ground the order of the general term should he affirmed.

All concur.


text:
    Lewis Roberts, Resp’t, v. Edward B. Cobb, Ex’r, Etc., App’lt.

      (Court of Appeals,

      Filed December 7, 1886.)

    Promissory -note—Consideration—Contribution on condition of raising; OF SPECIFIC SUM.-
    A promise to contribute money on condition that pledges for an amount specitied shall be procured is made upon good consideration. Upon the performance of the condition an action will lie for the amount so agreed to be contributed.
    Appeal from a judgment of the supreme court, second department, entered upon a verdict by direction of the court in favor of plaintiff.

      James M. Smith, for app’lt; Henry C. Griffin, for resp’t.

       See S. C. below, 31 Hun, 150; 37 Hun, 643, mem.

   Earl, J.

The persons interested in the First Baptist Church of Tarrytown had, prior to the first day of May, 1881, been engaged in building a church edifice, and at that-time there was a mortgage upon the church property upon which there was then due about $5,000. An effort was then being made by the church to raise the funds to discharge that mortgage, with a view to the dedication of the church in the near future. Eev. Mr. Horr, the pastor of the church, was active and efficient on its behalf in procuring subscriptions and pledges for that purpose. About the-first of May he called upon Mrs. Barker, defendant’s testatrix, an aged lady, who was a member of the church, and' requested her to make a contribution, and she promised to contribute $2,500 in cash, towards payment of the mortgage, if he would secure pledges for the balance, ($12,500,) and he promised her to make the effort. He at once set about raising the requisite sum, and secured pledges for the • amount during the month. After he had done so, on the-thirty-first day of May, 1881, he called upon Mrs. Barker for the amount of her subscription, and, she, finding it-inconvenient to pay the cash in discharge thereof, executed the instrument set out in the complaint, and delivered it to him. She subsequently paid thereon $500, and this action was brought by the plaintiff, to whom the note was indorsed by the trustees of the church, to recover the balance.

It is entirely clear, we think, that Mr. Horr must be' regarded as having acted for and on behalf of the church in procuring pledges to pay the mortgage. He was not acting in his own interest, and his relations to the church were such that it is a proper, if not an absolutely necessary, inference that he was its agent, acting for it with the sanction and co-operation of its trustees. This money and note which he obtained from Mrs. Barker were immediately delivered to the trustees, and his action approved by them; and all the moneys and subscriptions which he obtained were turned over to the trustees, and used in the discharge of the mortgage. Therefore, whatever he did, and whatever he promised to do, the church did and promised. We have, then a case where Mrs. Barker agreed to give $2,500 for the purpose of discharging the mortgage, on condition that the church would raise the balance by voluntary subscriptions, and the church promised her to make the effort. It did make the effort, and performed the condition, and therefore her promise became obligatory, and the note which she gave in fulfillment thereof is based upon a sufficient consideration. Trustees of Hamilton College v. Stewart, 1 N. Y., 581; Barnes v. Perine, 12 N. Y., 18; Marie v. Garrison, 83 id., 14; Pars. Cont. [5th ed.] 452, and notes.

But it could not be held that Mr. Horr did not act as the agent of the church, then it would follow that he acted for himself in procuring the subscriptions, intending to present the money obtained to the church for the discharge of its mortgage, and the same conclusion would still be reached. In that event, Mrs. Barker promised to give him $2,500 if he would procure subscriptions for the remaining $12,500. He accepted the offer, and performed the condition, and thus there was an adequate consideration to uphold her promise. He called upon her to perform her promise, and took her promissory note, payable to the trustees of the church, in discharge of the obligation to him. That note was founded upon a sufficient consideration, and was valid in the hands of the trustees, and they gave good title thereto by their indorsement to the plaintiff.

So in any view that can be taken of this case the judgment was right and should be affirmed.

All concur.


author: Miller, J.

text:
    People of the State of New York, Resp’t, v. Helen McCallam, App’lt.

      (Court of Appeals,

      Filed December 7, 1886.)

    1. Criminal trial—Indictment for grand larceny—Evidence—When sufficient to warrant submission of case to jury.
    Where, on the trial of an indictment for grand larceny,, the proof established beyond a doubt that the crime of larceny had been committed, and there was evidence which pointed to the defendant as the guilty party, besides a variety of circumstances pointing to the defendant -as the perpetrator of the crime, it is for the jury to draw the inference as the case stands and determine the guilt or innocence of the accused.

      2. Same—Refusal of court to pass upon propositions of law— Charge to jury.
    It is not error for the trial court to refuse to pass upon propositions of law where there is no motion before it requiring its opinion upon such. abstract questions, and it is proper to withhold its decision in regard to them until all the testimony is introduced and the case is ready for submission to the jury. Where the charge as made fully covers all the facts elicited by the evidence, there is no rule under such circumstances which requires the court to present abstract theories which would not serve to elucidate or explain the case as presented by the testimony.
    8. Same—Proof of exclusive possession not necessary.
    It was not necessary to show exclusive possession of the stolen property to authorize the conviction of the defendant; and where there is no direct proof of an actual possession, but evidence of circumstances, which tends to show that the defendant took and had possession of the stolen property, it is for the jury to say whether the defendant was guilty of the offense charged; and the pr, position that no presumption of guilt can be raised from the possession of stolon ] roperty except where the possession is conscious and exclusive on the part of the defendant, is inapplicable. n

    4. Same—Statement—Confession—Code of Grim, Pro., § 395.
    Where the defendant made a statement to the constables having her in charge to the effect that certain tracks leading to the place where the stolen property was found were hers, and such statement being made after the officers had told the defendant that “ she might as well own up, as they had proof to convict her.” Held, that under section 395 of Code of Grim. Pro., it was admissible as a voluntary confession.
    5. Same—Charge to jury as to grade of offense.
    It was not error under the evidence for the court to charge the jury that if they were convinced that the value of the property taken was over $500, and that the defendant took it, they might convict her of grand larceny in the first degree; and if the property w7as of the value of more than twenty-five dollars, they might convict of grand larceny in the second degree; and if less than twenty-five dollars, the verdict might be for petit larceny.
    Appeal from a judgment of supreme court, general term, fourth department, affirming a judgment of the Jefferson county court of sessions on a conviction of grand ■larceny
    • Watson M. Rogers and F. N. Fitch, for app’lt; E. C. Emerson, dist. att’y, for the people.

       Affirmi g 35 Hun, 663, mem.

   Miller, J.

The defendant was indicted for the crime of grand larceny in the first degree, and convicted of grand larceny in the second degree.

There was sufficient evidence upon the trial to submit to the jury the question whether the defendant was guilty of the crime for which a conviction was had, and under the facts proved, the court was not authorized to .direct a verdict of acquittal. The proof established beyond question that the crime of larceny had been committed, and there was evidence which pointed to the defendant as the guilty party. There was also evidence showing that the defendant had been informed by the wife of Hennessey that the money stolen was in a trunk belonging to Hen- ■ néssey,:. and kept Under a lounge in his hou’sé. No person -had access to the place where the trunk was kept, from the time it was last seen there prior to its being taken, besides Hennessey and his wife, except the defendant. The defendant was there on the night when the larceny was committed for the purpose of obtaining a bedstead of Hennessey’s wife, as she stated; and while, at her request, Mrs. Hennessey went up-stairs to procure the bedstead, she was alone for a, period of fifteen minutes, during which time she had ample opportunity to -remove the trunk and its contents without being detected. She was thus in a position where she might have committed the crime alleged. Several gold coins of the same denomination, and bearing the same date as those stolen, were found concealed in the defendant’s wood-shed wrapped up in a newspaper, other portions of which were’ found in the defendant’s house. There was also evidence of some tracks of the defendant and her daughter, made as if engaged in carrying something, and which led to the place where the trunk was found, with its contents gone, excepting a few small silver coins. In regard to these tracks^ the defendant and her daughter gave testimony which was contradicted by other, evidence. The facts referred to, with other circumstances not necessary to enumerate, point to defendant as the perpetrator of the crime, and it cannot be said, we think, that no offense was made out against her. It was for the jury to draw the inference as the case stood; and to determine the guilt or innocence of the accused.

No error was committed by the court upon the trial' in refusing to hold, at that stage of the case, that upon a presumption that a larceny had been committed, no presumption can be founded that the defendant committed the crime, and that, as matter of law, no presumption of guilt can be raised from the possession of stolen property, except where the possession is conscious and exclusive on the papt of the defendant. The court clearly had a right to reserve the disposition of these questions until the entire testimony was in, and could not, in accordance with any well established practice, be required to indorse propositions before the case was finally closed.. No motion was, at that timé;' before the court requiring its opinion on the abstract queé: tians presented, and it was eminently proper to withhold its decision in regard to them until all the testimony was introduced, and the case was ready for submission to the coti> sideration of the jury. Any other course might lead to. confusion, and tend to embarrass the action of the court iff its final disposition of the questions involved.

. The same questions were raised in the requests made to charge, some twenty-seven in all, at the close of the case'.In regard to all of these it may be said that they embraced mostly abstract propositions which would tend to confu sé the case in the minds.of the jury, and not lead them to a correct result. ' _

_ The first'.proposition,. above cited, may properly be said to be strictly accurate, but its presentation, in the form adopted, was in no sense required for the protection of the rights of the accused. The charge, as made, fully covered all the facts elicited by the evidence; and there is no rule, under such circumstances, which demands that the court should deal in presenting abstract theories which would not serve to elucidate or explain the case as presented by the testimony. The correctness of' the proposition made would necessarily follow from the presentation made by the judge in his charge, of the evidence upon the trial, and the rules "applicable to the same. The effect of the entire charge was that the commission of the crime alleged did not, of itself, raise a presumption of the defendant’s guilt, and that evidence was essential to establish one’s guilt.

As to the second proposition it may be remarked that it was not strictly accurate. It was not necessary to show exclusive possession of the stolen property to authorize the conviction of the defendant, and such a rule only applies in a case where the evidence of guilt is the possession of the property stolen and it is to be presumed from that fact. The question whether such possession establishes guilt is-one for the jury.

In the case considered, where there was no direct proof of an actual possession but evidence of circumstances which tended to show that the defendant took and had possession of the money, it was for the jury to say whether she was guilty of the offense charged, and the proposition stated would seem to be inapplicable.

What has been already remarked generally as to the first proposition is also applicable to the second, as well as to the other requests made.

.The rule applicable to the requests made is stated in Caldwell v. N. J. Steamboat Co. 41 M. Y., 282, by Church, Ch. J., as follows: “If the charge as a whole conveyed to the jury the correct rule of law on a given question the judgment will not be reversed, although detached sentences may be erroneous; and if the language employed be capable of different constructions, that construction will be adopted which will lend to an affirmance of the judgment, unless it fairly appear that the jury were, or at least might have been misled.”

Having this rule in view we are unable- to discover any ground of error in any of the refusals to charge any of the requests made

Upon the trial a motion was made by the defendant’s counsel to strike out all the evidence given by one Kinney in regard to the admissions made by the defendant after certain statements made by the officer Guest to the defendant, and also all the evidence of one Champlin as to the admissions made by the defendant that certain tracks, testified to, were hers and her daughter’s, for the reason they were made under threats by the officers, and that she was told she might as well own up as they had proof to convict her.

A further motion was made to strike out all the evidence .given on the subject subsequent to the statement that there was evidence sufficient to convict the defendant. The court denied each of the motions and the defendant excepted separately to the rulings. It appears that three of the constables were at the defendant’s house to make a search for the money stolen, when they had the conversation with the defendant as already stated and after which she told them about the tracks.

The question arises m the first place whether the statement made by the defendant was in the nature of a confession to the effect that the defendant was guilty of or had any connection with the crime which had been committed within the meaning of section 395 of the Code of Criminal Procedure, which declares that c A confession of a defendant, whether in the course of judicial proceedings or to a private person, can he given in evidence against him, unless made under the influence of fear produced by threats, or unless made upon a stipulation of the district-attorney that he shall not be prosecuted therefor.”

The evidence given by the defendant was a statement in regard to her action, so far as related to the tracks which had been found in the vicinity of the house where she lived.

Conceding that the declarations made by the defendant can be regarded as confessions, we think, under the testimony introduced, and under section 395 of the Criminal Code, supra, the evidence was competent.

No threat was employed by the officers which can be said to have induced the defendant to make any statement as to the alleged offense The assertion of the constable, that he had enough to convict her and that she might consider herself under arrest, did not, of itself constitute a threat which it can be claimed operated upon the mind of the accused, and caused her to make the declarations which she did.

In People v. Wentz (37 N Y., 304), the officer told the accused “he was in a bad fix, and had got caught at last.” The defendant then confessed his guilt, and it was held that there being no inducement, promise, threat or menace used to obtain the confession, or influence its being made, the evidence was properly admitted. It is not apparent that any distinction exists between the case cited and the one now before us. In both of them the statement was to the effect that the defendant had been detected in the commission of the crime alleged. The statement in each case was substantially alike, and the case cited is directly in point. There is nothing here which indicates that any threat was made, or that the declarations of the defendant were induced by fear. That they were untrue is of no consequence, so long as they were made by the accused as voluntary statements in lier own behalf.

The evidence of Champlin as to the declaration of Angelina Quinn was, we think, competent. The evidence showed that she was an accomplice in the commission of the crime charged, and she had already testified in regard -to the transaction. The evidence introduced tended to contradict her testimony, and was clearly admissible.

There was no error in the charge of the court to the jury, to the effect that if they were convinced that the value of the property taken was over $500, and that the defendant took it, they might convict her of grand larceny in in the first degree; and if the property taken was of the value of more than twenty-five dollars, they might convict of grand larceny in the second degree; and, if less than twenty-five dollars, the verdict might be for petit larceny.

The only evidence as to the amount of money lost was that of Hennessey, who swore on his direct examination that he lost $540. He was cross-examined at great length in regard to the amount of money that he had, and evidently with the view of showing that it was uncertain what amount of money in fact was in the trunk. If the amount was less than $500 and more than twenty-five dollars, then the crime was grand larceny in the second degree. Assuming' that the money in the trunk was not stolen, as twenty dollars in gold and $3.Y5 in silver quarters were found, and these, with the trunk and socks, made property over the value of twenty-five dollars, the crime of grand larceny in the second degree would be established by the evidence. The charge, as made, had a direct bearing upon this portion of the evidence; and if the jury believed that there was doubt as to the property taken amounting to over $500, they might properly have found the defendant guilty of a lesser degree than the first. Sor also, if the evidence was uncertain as to the taking of the-trunk, and the amount of money testified to by Hennessey, they might have convicted the defendant for the taking of the smaller amounts found, in whole or in part, and brought in a verdict of guilty of petit larceny. The crime charged was grand larceny; and, if the evidence established only petit larceny, there is no reason why a conviction should not be had for that offense.

- We have examined the other questions in the case, and find in none of them any ground of error which justifies a reversal of the judgment.

The conviction should be affirmed.

All concur, except Rapallo, J., not voting.


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    Matter of the Judicial Settlement of the Accounts of John J. Jones et al., Ex’rs, etc.

      (Court of Appeals,

      Filed December 17, 1886.)

    Will—Construction of—Authority to executors to carry on business—When EXPENSES CHARGEABLE TO INCOME.
    The testator was extensively engaged in the business of brewing, and by his will authorized and empowered his executors to continue his business and gave his estate to his executors in trust, directing them to keep the real estate insured and in repair and the personal estate invested, and to collect rents, profits and i i.erest, etc , “and after paying the taxes and assessments, expenses of repairs and insurance and all other legal and necessary charges and expenses to pay over the residue net proceeds ” to certain persons named during their lives In conducting the business a considerable amount of the credits given were lost to the estate and money was paid out in replacing various articles worn out in the business. Held, Tiiat the amount of these charges should be deducted from the income. That any money which might be paid out in the course of the business which was essential to carry it on would be a necessary and proper charge against the income and profits in determining what amount of the residue or net proceeds remained for distribution among the legatees.
    Appeal from a judgment of the supreme court, general term, second department, affirming a decree óf the surrogate of Westchester county, made upon the settlement of an executor’s account.

      Luther JR. Marsh, for app’lt; Martin J. Keogh, for resp’t.

       Affirming, 37 Hun, 430.

   Miller, J.

The questions in this case arose on the final accounting of the testator’s executors before the surrogate of Westchester county, and affect the construction to be placed upon portions of his will.

The testator, before his death, was extensively engaged in the business of brewing ale and beer in the city of New York and vicinity, and by his will authorized and em powered his executors to continue' his business for such time after his decease as they should think most advantageous to his estate, and he gave directions as to the management thereof and the distribution of the profits arising from the same. He then made provision for the division of the whole of his estate into five equal shares, and disposed of them substantially alike by separate provisions in regard thereto, one of which is as follows1 c-1 give, devise and bequeath to Wilson G-. Hunt Martin Blydenburgh, Alexander Thayer and John J. Jones, executors and trustees under this my will, one equal fifth part of all my estate, real and personal, after payment of debts and funeral expenses as aforesaid, to have and hold the same, to them, the survivors and survivor of them, for and during the life of my sister, Margaret Jones; m trust, nevertheless, to take possession of the real estate, keep the same in proper and suitable repair, keep the buildings thereon well insured, and to let or lease the same from time to time and for such term of time within the lifetime of my said sister Margaret, as to them may seem best, and for the best rent that can be obtained therefor; to keep the personal estate safely and securely invested, and to collect the rents and profits of the real estate, the interest, dividends and income of the personal estate, and after paying the taxes and assessments, expenses of repairs and insurance, and all other legal and necessary charges and expenses, pay over the residue or net proceeds of said one-fifth part of my estate, so given to them in trust as last aforesaid, to my said sister Margaret, semi annually, during her fife.”

Under the provisions of the will the executors for a number of years continued to carry on the business in accordance therewith. They sold the beer manufactured to purchasers on credit, as they had authority to do by the will, and a considerable amount of the credits created became uncollectable and were lost to the estate. In the account filed by the executors these losses were charged against the income of the fife -tenants, and deducted from the same. Various appliances and articles which had been worn out in the conduct of the business, as well as horses which had died, were replaced by the executors and the amount paid therefor charged against the life tenants. Certain items for repairs were also charged against the life tenants. All ' of the charges enumerated were allowed by the surrogate upon the accounting.

. These allowances present the question whether under the will they were proper charges against the income and whether the executors have complied with the intention of the testator in reference thereto.

The testator after vesting authority in his executors to hold in trust his real estate for the purpose named, and for collecting the rents and profits of the real estate, the interest, dividends and income of the personal estate, and the payment of all legal charges and expenses, provides for the payment of the residue or net proceeds as directed in the clause cited. By the terms ‘ ‘ residue or net proceeds ” the testator evidently intended to dispose of such portion of the income as should remain after making proper and legitimate deductions for expenses and losses incurred in the management of the estate, and in the conduct of the busi ness which was intrusted to their charge. Any money, therefore, which might be paid out in the course of the business which was essential to carry it on would be a necessary and proper charge against the income and profits in determining what amount of the residue or net proceeds remained for distribution among the legatees.

It would be very difficult to draw a dividing line by which it could be determined that a certain portion of the expenses incurred and disbursements made in the transaction of the business should be made a charge against the capital employed, and another portion against the profits or income. While a case might arise where a large expenditure, as for instance the erection of additional buildings might be such an improvement of the real estate as to become an addition to the capital employed, yet any ordinary expenditures for repairs or improvements would not be embraced within any such rule. So, also, in reference to the wearing out, loss, of, or depreciation of personal property, it cannot well be claimed that moneys expended to replace the same should not be deducted from the income received or profits realized.

It was not necessary, we think, that the testator should have expressed in his will in more specific terms, what items should be deducted, and he evidently meant by the language employed to include all losses and all expenses which were necessarily incurred in the management of the estate and the conduct of the business.

It can hardly be supposed that the testator intended that a division should be made of profits realized from the business without deducting expenses and losses. Such a disposition of the income received would not constitute a division of the 1 ‘ residue ” as the amount would be greater than what actually remained. There would m fact be no such profits or balance on hand to be divided. The expenditure would have been made without any provision for its payment or reimbursement, and the value of the investment in the business very seriously impaired The effect of charging any of the expenses which related to the business upon the principal of the estate would be a serious impairment of the capital employed in the business, which might in the end absorb the same and thus destroy all income arising therefrom.

It is no answer to this view of the subject to say that under the will the business is ■ only to be conducted so long as in the opinion of the executors it shall be to the advantage of the estate to carry it on, as clearly it could never have been intended that the conduct of the business should deplete the estate by dividing its capital to make good the expenses and losses referred to. Nor can it well be said that the losses were to be apportioned between principal and income as it might be determined, and it is nowhere manifest that the testator’s intention was that the devisees should not only receive the income, but a portion of the principal. It would require a close calculation to determine what apportionment should be made as to a portion of the losses incurred, and it is not fairly to be inferred that the testator intended that any such degree of exactitude should be required.

The provision under the will authorizing the executors to discontinue the business when it was no longer advantageous to continue it bears strong indication of the intention of the testator that when the body of the estate fails to yield a sufficient income, after making proper deductions, then the occasion arrived as mentioned in the will when it became the duty of the executors to discontinue the business.

The order of the general term affirming the decree of the surrogate should be affirmed with costs.

All concur.