author: McAdam, J.

text:
    The People ex rel. Eugene Noel, Pl’ff, v. Alexander Smith et al., as Board of Inspectors, etc., Def’ts. The People ex rel. Michael McCarty, Pl’ff, v. Same, Def’ts. The People ex rel. Henry Poth, Pl’ff, v. Same, Def’ts. The People ex rel. Patrick E. Hackett, Pl’ff, v. Same, Def’ts. The People ex rel. John Rountree, Pl’ff, v. Same, Def’ts. The People ex rel. John Greener, Pl’ff, v. Same, Def’ts.

      (New York Superior Court, Special Term,,

      Filed October, 1894.)

    Aliens—Naturalization—Proof.
    Upon application for registration as a voter, a person claiming to be a naturalized citizen, may give secondary evidence of the contents of his-naturalization papers, where the papers themselves cannot be found.
    Application for writs of mandamus.

      Lamb, Osborn & Petty, for relators; A. O. Smith, for resp’ts.
   McAdam, J.

The constitution of the state provides that: “Every male citizen of the age of twenty-one years, who shall have been a citizen for ten days and an inhabitant of this state one year next preceding an election, and the last four months a resident of the county, and for the last thirty days a resident of the election district in which he may offer his vote, shall be entitled to vote at such election in the election district of which he shall at the time be a resident, and not elsewhere, for all officers, that now or hereafter may be elective by the people.” Const. N. Y art. 2, § 1.

It also provides that: “ Laws shall be made for ascertaining by proper proofs the citizens who shall be entitled to the right of suffrage hereby established.” Id. § 3. Under these provisions, the courts have held that, where a person asking to be registered claims to be a citizen by virtue of the naturalization of his parents, the best evidence of such naturalization would be the original certificate of naturalization, or a duplicate thereof, when it can be obtained. But a party may, in the matter of proving his citizenship, resort to secondary evidence when primary evidence cannot be had. People v. McNally, 59 How. Pr. 500; People v Pease, 30 Barb. 588. In the case last cited, Judge Allen says: “ The board of inspectors are not judges, nor do they exercise a judicial power inreceiving or in counting the votes. They cannot, summon witnesses, or impanel a jury, or give the parties inter ested a hearing. They can examine the proposed elector upon his oath, and there their power and means of judicial investigation cease; and it would be strange indeed if their conclusion should be final as against the state and all interested.”

And again he says: “The elector is made the judge of his own qualifications, and his conscience takes the place of the judgment, and decision of every other tribunal for that occasion. The inspectors may probe his conscience, and instruct and advise, but they cannot decide upon his.qualifications.”

Fraudulent registration, or an attempt to offer to register in any election district by any person not having a right to register therein, is made a felony, and the punishment prescribed for the offense-is imprisonment in a state prison. People v. McNally, 59 How. Pr. 500. The supreme court of the United States has held that, where no record of naturalization can be produced, evidence that, a person' having the requisite qualifications to become a citizen did in fact and for a long time vote and exercise rights belonging to citizens is sufficient to warrant a jury in inferring that he has been duly naturalized as a citizen. Boyd v. Nebraska, 143 U. S. 135. Substantially the same rulings have been made by Dugro, J., in Peoples v. Board of Inspectors, N. Y. Law J. Oct. 22,1889, and by Barrett, J., in People v. Murphy, N. Y. Law J. Oct. 31, 1891; and such is the opinion of the corporation counsel of New York,— the result of which is that if a party applying for registration has-the best evidence in his possession, i. e., the naturalization papers, he should produce them ; if they cannot be found, secondary evidence of their contents must be received. Such being the law,. and the facts presented by the relators bringing their cases within the principles of the adjudications, nothing can be done except to require the respondents to place upon the registry of voters the names of the relators as qualified voters, provided they take the necessary preliminary oath to entitle them to registration ; and a mandamus to this effect must issue. If at the time the final writ herein is served the beard has adjourned, it may reconvene on election day, or sooner, as may suit the convenience of all concerned, and make the appropriate entries.

Mandamus granted.


source: Caselaw Access Project

author: Coleman, S.

license: Public Domain

text:
    In the Matter of Beyea’s Estate.

      (Surrogate’s Court, Orange County,

      Filed November, 1894.)

    1. Limitation—Exbcütob—Accounting.
    The statute of limitations does not begin to run against an accounting by an executor, until he openly repudiates his duties. ■

      2. Executors—Accounting—Receiver.
    A receiver in supplementary proceedings of a judgment debtor legatee may require an accounting by an executor.
    Application by a receiver to compel an executor to account.

      Dill & Cox and W. Vanamee, for petitioner; J. C. R. Taylor, for executor.
   Coleman, S.

An application by a receiver in supplementary preceedings to compel an executor to account. The testator died August 21, 1877, and letters testamentary were granted September 14, 1877, to Samuel and Nathaniel Beyéa. By his will the testator gave to his widow “ all his real estate, goods, chattels, and notes, money, and all other personal property, * * * to hold the same during her natural life,” and, at her death, he gave to his four children (said executors being two of them) equally all his “real estate, goods, chattels, notes, money, and all other property which I shall have at the time of my death, or the death of my wife.” The testator’s wife survived him, and died in February, 1894. The petitioner was appointed receiver, etc., of the son Samuel Beyea, September 28, 1877. It was decided in Re Van Dyke, 44 Hun, 394; 9 St. Rep. 137, that an administrator with the will annexed could not be compelled by the surrogate’s court to render an account after 7£ years from the date of his appointment, because of the statute of limitations; and the law as there decided was afterwards followed by the surrogate of Westchester in the case of an executor (In re Dunham's Estate, 6 N. Y. Supp. 563), and by the surrogate of New York in the case of an administrator (In re Clayton's Estate, 22 St., Rep. 886; 5 N. Y. Supp. 266). But afterwards, in Re Camp, 126 N. Y. 377; 37 St. Rep. 767, the court of appeals decided that a general guardian could be compelled to render an account 16 years after his ward became of age, because the fund received by him as guardian was the property of another confided to his care ; and in that sense he occupied the position of a trustee, so as to prevent the running of the statute of limitations, even if it was not a “ trust,” in the usual legal sense of the term. There are some distinctions between the nature and duties of the office of an executor and an administrator and those of a general guardian, but I doubt if they be of such a character as to place them outside of the application of the decision in lie Camp, when so broad a character, as to their duties to account, is given such officers. Executors and administrators are appointed to take the custody and care of the property of others, impressed with certain duties and trusts, which they must discharge in order to be relieved, either by their actual performance or by the presumption of their having been performed; and it would seem that this presumption will not arise until such duties have been openly repudiated for the statutory period, and does not by the expiration of the statutory period after the time fixed for them to account. In re Grandin, 40 St. Rep. 655; 15 N. Y. Supp. 946; In re Camp, supra.

It is claimed on behalf of the executors that they should not be required to give an account of the personal property, because the will gave the widow the right to hold it during her life, and there is no proof that any part of it has since her death come into their hands. This is riot tenable, because the widow was only entitled to the possession of such of the personal property as could only be used by having the possession, and possibly even such should have been converted. The executor should, however, have retained the custody of moneys and securities, and only paid over the income. A receiver'in supplementary proceedings of a judgment debtor legatee may require an accounting by an executor. In re Rainey's Estate, 5 Misc. Rep. 367.

An order will therefore be made requiring the executor Samuel Gr. Beyea (he being the only one served) to render an account Ordered accordingly.


author: Merwust, J.

text:
    William Cooley, App’lt, v. Elmina E. Lobdell, as Admistratrix, etc., Resp’t.

      {Supreme Court, General Term, Fourth Department,

      Filed December 7, 1894.)

    1. Statute of frauds—Ratification. "
    A prior oral contract to convey is not validated by a writing which does not express the consideration or sufficiently describe the property.
    2. Specific performance—Payment of consideration.
    Payment of consideration is not such part performance of an oral contract to convey as to entitle the vendee to equitable relief.
    '3. Limitation—Action to recover proceeds of lands sold.
    The statute of limitations begins to run against an action to recover the proceeds of land which the defendant had agreed to convey to plaintiff, but afterwards conveyed to a third person, from the time the right of action for specific performance accrued.
    Appeal from a. judgment dismissing the complaint, and from an order denying a motion for a new trial.

      A. D. Wailes, for app’lt; Carver, Deyo & Jenkins, for resp’t.
   Merwust, J.

Olive Cooley, a daughter of the plaintiff, married Gideon Lobdell, defendant’s intestate, in 1864. They had one child, who died in 1878. Lobdell, in 1871, became the owner of a farm of 160 acres in the town of Conklin, in the county of Broome, and on the 'east side of it there was an old house. In 1874, Solomon Bunnell, the grandfather of Olive, died, and she was one of his heirs," From him, before be died, or from his-estate, after he died, and prior to 1876, she received about the sum of $4,000. There is evidence tending to show that in the'fall of 1874, or early in 1875, it was verbally agreed between Olive and her husband that she would let him have her money to enable him to build a new house on the west side of the farm, and that, when the house was done, he'would deed it to her, together with 60 acres, the western part of the farm. One witness testifies as follows: “While I was there on my visit, Gideon said to me: ‘Mother, I am going to tell you what I have been thinking of doing, or would like to do; that is, divide the farm, run off sixty acres, and build a house on it, and move there. But I can’t do it unless Olive will let me have the money to build the house with.’ Olive says: ‘ He offered me his note if I would let him have the money, and I won’t do it, and take his note.’ He hesitated a few minutes, and he said: ‘I will tell you -what I will do. I will give you a deed of the sixty acres when the house is done, if you will let me have the money to build the house with/ And she said: “I will let you have the money if you will give me a deed when the house is done.’ He said he would give her a deed of the sixty acres of land when the house was done if she would let him have her money to build the house with. She told him she would. The money spoken of was money she expected from her grandfather. It was after his death. In this talk I have thus given, it was said that he was to work the farm, and have the proceeds, and he was to pay off the mortgage,—to see that the mortgage upon it was paid off if he had the proceeds of the farm. In this conversation it was said the money she had let him have and would let him have was four-thousand dollars.”

Prior to 1876 the husband received the money, and the new-house was built in 1876, at an expense of about $2,600, and the parties moved into it in September, 1876. Stakes were set indicating the division line between the sixty acres and the balance of the farm. There is evidence that the husband stated that the house was built just as his wife wanted it, and that he called it hers. There is no proof that Mrs. Lobdell made any improvements, excep't she set out a rosebush and some pieplant roots and various other roots for Sower beds to ornament the yard. Mr. and Mrs. Lobdell lived in the house until April 1, 1880, when they moved to Binghamton, where they lived until the death of Mrs. Lobdell, on August 27, 1882. The sixty acres were never deeded to her, though request was made as early, at least, as February, 1877, and he verbally promised to do it. In August, 1880, when Mrs. Lobdell was at her father’s, her husband wrote to her a letter, signed by him, in which he says, among other things: “ If you will come back, I will surely do as I agreed to. I will give ymu a deed of the sixty acres of land." Mrs. Lobdell died intestate, leaving the plaintiff as her sole heir at law. On the 31st January, 1892, Mr. Lobdell died, and the defendant was afterwards duly appointed his administratrix. Prior to his death, he sold and conveyed all of the sixty acres. Three acres he sold in 1879, his wife, Olive, joining in the deed; and the balance was sold in 1887 and 1888, the last being April 1, 1888. He received upon these sales about $4,500, and that is the amount the plaintiff seeks to recover here. This action was commenced ¡November 9, 1893. The defense is twofold: First, that a case for specific performance was not made out; and, second, that the statute of limitations is a bar.

1. There was no writing to take the case out of the statute of frauds, unless the letter of August, 1880, be such. That, how-" ever, was imperfect. It did not express the consideration, nor was the property sufficiently described. Wright v. Weeks, 25 N. Y. 161; Rollin v. Pickett, 2 Hill, 552; Wat. Spec. Perf. § 236.

Was there such a part performance of the verbal contract as to authorize equitable relief? The payment of the consideration was of itself not enough. Winchell v. Winchell, 100 N. Y. 163; 2 Story Eq. Jur. § 760. In Miller v. Ball, 64 N. Y. 292, it is said: “ The payment of the consideration alone, in a case where its recovery in an action at law would fully indemnify the party paying, would not be a sufficient part performance within the rule under consideration, and neither would mere possession be, without any other circumstance of hardship or fraud. But payment of the consideration and possession under the agreement, or by the consent of the vendor, are facts which may be considered with other facts upon the question of part performance.”

The part performance must be substantial, and nothing will be considered as part performance which does not put the party into a situation which is a fraud upon him unless the agreement be fully performed. Wheeler v. Reynolds, 66, N. Y. 231; 2 Story Eq. Jur. § 761. .If improvements are relied on, they should be of a substantial and permanent nature. Wat. Spec. Perf. § 281; 2 Story Eq. Jur. § 761, note 4; Dana v. Wright, 23 Hun, 32. In Adams’ Equity (6th Am. Ed. p. 212) it is said that the principle of part performance does not apply “ to any acts which do not alter the position of the parties,—such, for instance, as the taking of surveys, the preparation of conveyances, the payment of earnest, and even the payment of purchase money itself; for, although all these acts are in some sense a performance of the contract, yet, their consequences may be set right by damages at law, and they ■do not place the parties in a position from which they can only be extricated by its completion.” The taking possession and making improvements is said to be a necessary condition. Dunckel v. Dunckel, 56 Hun, 29; 29 St. Rep. 477.

In this case there was nothing done by the wife that could fairly be considered improvements as applicable to such a case. There was no possession; certainly none that would make her a trespasser if there were no contract. She was not in control of the property. By the arrangement the husband was to pay off the mortgage with the proceeds of-the farm, and so necessarily he was to remain in possession. The case of Smith v. Smith, 51 Hun, 164; 20 St. Rep. 597; affirmed in 125 N. Y. 224; 34 St. Rep. 857, is relied on by the plaintiff. In that case the husband, with the assent of his wife, with his own means, built a block upon the land of the wife upon her verbal agreement that, if he did so, he should have a lien thereon for the amount, with a right to sell if necessary, and recover back the advancement. This was in 1879, and the property was increased in value to the amount of the advance. The husband thereafter managed the property, using the rents and profits for the benefit of the family until 1887, when there was a disagreement, and the wife repudiated the agreement. It was held that the husband had a lien that equity would enforce, it being said that the wife incurred no individual liability by reason of the arrangement. The husband had no remedy unless he had a lien. In the present case the situation is different, especially in the fact that the wife, upon the refusal of the husband to perform, could have sued for the money advanced. There is no evidence to what extent the farm was benefited. Besides, if the transaction be treated as a security for money advanced, the right of action on the death of the wife would go, not to the heir, but to the personal representatives, and so inure to the benefit of the surviving husband. Robins v. McClure, 100 N. Y. 328, 336. The Smith Case does not, I think, help the plaintiff, but his case must be determined by the rules ordinarily applicable to the specific performance of such agreements. For aught this case discloses, an action for the recovery of the money would have fully protected the wife, and no such fraud can be said to have existed as would furnish a basis for equitable action under well-settled principles applicable to such subjects.

2. The house was completed in the fall of 1876. Then, upon failure of the husband to perform, if the wife had good ground for specific performance, she might then have brought her action. Bruce v. Tilson, 25 N. Y. 194; McCotter v. Lawrence, 4 Hun, 107. The present action was not brought till November, 1893. The application of the 10-years statute of limitations is sought to be avoided upon the idea that plaintiff’s right of action accrued upon the sale by the husband of the land. The last sale was on April 1, 1888. In some cases the value of the property, or what it was sold for, may be the measure of damages, but the sale does not give the cause of action. The plaintiff has no right except as he may establish a case for specific performance. As said in Matthews v. Matthews, 133 N.Y. 679; 45 St. Rep. 842, the substituted damages founded upon the value of the property could not be awarded until it was determined that the plaintiff was entitled to a specific performance. “ The law giving the purchaser an immediate action, it is no answer to the claim that the statute of limitations then commenced running that the form of relief which he could then have had was not precisely the same as that now attainable.” Peters v. Delaplaine, 49 N. Y. 369. A new cause of action cannot be created by a subsequent demand of specific performance. Bruce v. Tilson, 25 N. Y. 194. “ If there are suecessive owners of'the cause of action, or of equitable relief, and the right to prosecute arises in the time of the first, the period of limitation commences at that time, and continues attached to the demand during the several subsequent changes of both; and, when the statute period has elapsed, the demand is barred, though the last proprietor had recently acquired his right.” Denio, J., in Bucklin v. Bucklin, 1 Abb. Dec. 251. This is not. the case of moneys received by an agent- from a third party, within the rule laid down in Nearing v. Brown, 10 St. Rep. 637.

But it is urged that Gideon Lobdell was a tenant by the curtesy, and so the time from his wife’s death to his own death should be excluded. It is not clear that any such right existed. If, as held in Wheeler v. Reynolds, 66 N. Y. 227, the paroi agreement was. void in equity as "in law, and the right of the court to give relief is founded, not on the agreement, but on the fraud, it is difficult to see how the wife had any seisin, legal or equitable, that would furnish a basis for curtesy. In Harvey v. Brisbin, 143 N.Y. 152; 62 St. Rep. 270, the right of a tenant by the curtesy is said to be a legal right. Besides the right to sue being in the wife, the running of the statute commenced before his death. A person cannot avail himself of a disability, unless it existed when his right of action or of entry accrued. Code Giv. Proc. § 408. The general rule is that, when time has once commenced to run in any case, it will not cease to do so by reason of any subsequent event which is not within the saving of the statute. 1 Wood, Lim. Act. (2d Ed.) § 6. The existence of a possible right of curtesy would not prevent the plaintiff establishing his right, if he had one; it might affect the extent of his relief. A number of cases are cited with reference to the enforcement of debts of ancestors against heirs or devisees, but they do not seem to apply here.

The foregoing considerations lead to the conclusion that the defense in both aspects is-made out, and that the nonsuit was properly granted.

All concur.

Judgment and order affirmed, with costs.


author: Parker, J. Barrett, J.

text:
    Edwin Gomez et al., App’lts, v. Horatio Gomez as Trustee, etc. et al., Resp’ts.

      (Supreme Court, General Term, First Department,

      Filed November 16, 1894.)

    1. Trusts—Power of trustee.
    A trustee, in the absence of specific authority in the trust instrument, is without authority of his own motion to make a covenant during the life of the trust, which shall entitle the lessee to demand and receive renewal leases after its expiration.
    2. Same.
    Such lease is not rendered valid by the fact that the life beneficiary, who-has a power of appointment, has joined in it.
    3. Same—Power of court of chancery.
    The court of chancery could not confer upon a trustee powers which were not conferred by the trust deed.

      4. • Same—Decebe.
    In an action to construe the trust deed, to which all persons then in being who had an interest were made parties, a decree, authorizing the, trustee to make such a lease, cannot he collaterally attacked by such' parties.
    5. Lease—Alienation.
    A lease does not suspend the power oí alienation.
    6. Same—Renewals.
    Where a lease covenants for renewals, each renewal need not contain the covenant.
    Appeal from an interlocutory judgment, sustaining a demurrer to the complaint.

      Hector M. Hitchings. for app’lts; Michael H. Cardozo, Edgar J. Nathan, and John A. Straley, for resp’ts.
   Parker, J.

This suit is brought on the equity side of the court to obtain an adjudication that certain of the defendants are not entitled, as matter of law, to a renewal for 21 years of the five several leases described in the complaint, and to restrain the defendant-Horatio Gomez from executing to the other defendants a renewal of such leases. The special term sustained the demurrer interposed by the defendants, the ground of which is “ that the complaint does not state facts sufficient. to constitute a cause of action.” Such of the facts as are necessary to present the principal questions discussed on this appeal are as follows: In May, 1831,'Harmon Hendricks, then the owner of certain real estate in the city of Hew York, conveyed the same by deed to three persons in trust, to pay Hetty Hendricks all the rents, issues, and profits of the premises described, and to convey the said premises by full and sufficient conveyances in law to such persons as she, the said Hetty Hendricks, might in and by her last will and testament, or by appointment in the nature thereof, nominate and appoint, and, in default of such last will and testament or appointment, then to all the lawful issue of said Hetty Hendricks then living, as tenants in common, and not as joint tenants. Ten years latter, Hetty Hendricks, then the wife of Aaron L. Gomez, together with her husband, instituted a suit in the court of chancery, in this state, against the trustees under such deed, for an adjudication as to the- right of the latter to make leases and renewal of leases for a long term of years. The defendants consisted of the trustees and the children of Hetty Gomez, among whom was this plaintiff, Edwin Gomez, then an infant. The suit resulted in a decree bearing date October 21, 1831, in which, among other things, it was adjudgéd: “That the said trustees, Solomon I. Isaacs, Uriah Hendricks, and Henry Hendricks, and the survivor and survivors of them, and any trustee or trustees hereafter substituted, shall have full power, with the consent and approbation of the complainants, or the survivor of them, to be expressed by their, his, or her legal execution and acknowledgment of the leases hereinafter mentioned, to make and execute valid leases of the premises described in the bill of complaint and the schedule thereunto annexed, or any part thereof, for the term of twenty-one years, with covenants of renewal for several successive terms of twenty-one years (not exceeding three such additional terms), reserving an annual rent to be paid quarterly for the first term of about five per cent, upon the value of the property, * * * and that the rent reserved annually for the next ensuing term be at the rate of five per cent, upon the valuation so made thereof, and with such other covenants and upon such conditions as the said trustees in their discretion shall deem proper and shall consider most advantageous to the complainant Hetty Gomez and her children.”

The trustees promptly availed themselves of the permission ■obtained in the decree, and by leases bearing the date next succeeding that of, the decree, in which the trustees were named as parties of the first part, John Peters (the lessee) of the second part, and Hetty and Aaron L. Gomez of the third part, they leased-the premises for a term of 21 years, with covenants of renewal for three successive terms of 21 years each. The lessee ■entered into possession, 'and at the expiration of the term renewal leases were executed, each for a period of 21 years; and when such period had expired, still other renewal leases of 21 years were executed. The period of the second renewal had about expired; and Hetty Hendricks, for whose benefit the trust was created, has in the meantime died, leaving a last will and testament, which has been duly probated, in and by which she has exercised the power of appointment conferred upon her by the original trust deed. The plaintiff Edwin Gomez is one of the beneficiaries in the estate by virtue of the exercise of the power of appointment in his behalf by his mother. He insists that the trust terminated upon the death of Hetty Gomez, at which time the property became vested in the appointee designated in Hetty Gomez’s will; that at the latest moment of time the trust was at an end when the trustees, by appropriate conveyances, deeded the property to the appointees. He contends that there is no power in the trustees to make leases of the property after the trust has terminated, nor power in the court to authorize the trustees to do so. And further, that the power does not reside in the trustees to make a covenant to renew a lease which shall bind them or their successors to the legal estate, in the event that between such dates the trust shall come to an end, and by reason of the death of the beneficiary; nor, asserts the appellant, could the court empower the trustees to make such a lease binding and enforceable. There are cases—such as Newcomb v. Keteltas, 19 Barb. 608, and Greason v. Keteltas, 17 N. Y. 491—which are occasionally cited as supporting the authority of trustees to renew a lease after the death of the beneficiary of the trust, if done in pursuance of a covenant in the original lease to make such renewal. These cases arose under a trust created prior to the enactment of the Revised Statutes, which effected a radical change in the law of trusts. In re McCaffrey, 50 Hun, 871, in which it was held that, unless expressly authorized by the trust deed, a trustee is without power to make leases extending beyond the trust term, and, if he attempts it, the lease is invalidated by the death of the beneficiary, the Keieltas Oases, supra, are considered, and the reasons given why they should not be held to be in conflict with the-doctrine of that case. The consideration which they receive meet with our approval, and therefore justifies the omission of their further discussion. It would be strange, indeed, if the rule should be otherwise than as asserted in re McCaffrey, for then would the trustee be clothed with authority during the life of the trust to insert in a lease covenants of renewal for a given number of terms which would operate to deprive the owner of the property at the termination of the trust of its possession and control. The trustee would, mother words, have the power to fasten upon the estate for a long series of years a lease which might become a very serious burden to the owners. Courts have been careful not to permit an extension of the control of trustees beyond the happening of the event which measures the trust term. Where, as in this case, the trust instrument provides that at the death of the life beneficiary the trustees shall convey the property held by them in trust to a person designated, or to one to be appointed in a manner provided, it is held that the trust does not continue-until such conveyance be made by the trustees, but, on the contrary, that the death itself operates not only to terminate the trust, but to vest the title to the real estate at once, a formal conveyance .by the trustees being wholly unnecessay. Watkins v. Reynolds, 123 N. Y. 211; 33 St. Rep. 173. We are, therefore, in accord with the appellant, in so far as he contends that trustees, in the absence of specific authority in the trust instrument, are without authority of their own motion to make a covenant during the life of the trust, which shall entitle the lessee to-demand aud receive renewal leases after its expiration.

We are further of the opinion that the assertion is not well founded which has been made in this case to the effect that because Hetty Gomez, in whom was lodged the power of appointment conferred by the trust deed, signed the original lease containing covenants as to renewals that her appointees as such are either bound by or legally affected by such action. The trust as created gave to her all of the net income of the property, but over the property itself she was given authority to do one thing only: she could designate, in the manner provided by the trust instrument, who should have it after her death, but, in default of her making such an appointment, the deed of trust vested the property. Beyond being entitled to receive the income from the trustees, and to exercise the power of appointment, she was without any authority whatever over the property. She could not mortgage or otherwise incumber it, even though the form which the incumbrance should take should be that of a lease for a term of years at an inadequate rent. Whether the court of chancery, which made the decree, had power to authorize the lessors to covenant for the giving of renewal leases for a period which it was certain would extend beyond the life of the trust presents a different question. That such a power should rarely, if ever, be exercised, will be readily assented to. That the authority resided in the court of chancery to direct trustees generally as to the manner in which they should discharge the duties resting upon them as such, in the absence of specific instructions in the trust instrument, has always been recognized. Indeed, it constitutes one of the acknowledged heads of equitable jurisdiction. The deed of trust in question did not expressly confer upon the trustees authority to make leases, and the object of the suit instituted by Hetty Gomez and her husband was to obtain an adjudication as to the rights of the trustees to make leases and renewals of leases for terms of years. The plaintiff was entitled to the whole of the income during all her life, and she was necessarily interested in having the property so leased as to produce the largest possible amount of rent. By means of an appropriate complaint she presented to a court having jurisdiction to direct the manner in which the trustees should execute the trust committed to them the question whether they should be authorized to lease the property for a term of years, with the right of several renewal terms of like duration. The result was a decree, from which we have already quoted, authorizing the making of such lease as the trustees did make. The complaint does not inform us what were the special facts which were presented to the court for the purpose of inducing it to authorize the making of a lease and renewals covering so many years. Whatever they were, they must have strongly impressed Hetty Gomez, who was entitled to the income for life, and the right to say who should have the property after her death. She was a mother, and quite likely to think of her children as the owners of the property at a subsequent, but not far distant, time. A situation can readily be supposed which would have greatly advantaged her as owner of the life estate, as well as her appointees. Assuming that the property, by reason of the absence of buildings, would produce but little income, and, further, that there was no money available for the erection of new buildings, a lease for a term of such length as to induce the lessee to erect buildings with a substantial increase in the annual income of the property might prove very helpful to the beneficiary for life, and of substantial advantage as well to those in whom the entire estate would become vested at her death. But, as we view the question presented, we have no occasion to inquire into the facts which were presented to the court, and upon which its decision was founded, for when the decree was made it not only had jurisdiction of the subject-matter presented by the complaint, but it had jurisdiction of all persons necessary to make a decree construing the instrument, and instructing the trustees as to their duty in the premises. Before the court, either as plaintiffs or defendants, were the trustees; the then born children of the life beneficiary, to whom the property would go in the event that she should omit to exercise the power of appointment; the beneficiary Hetty Gomez, and her husband. There were no others who could have been properly made parties to the suit. The infants, among w'hom was this plaintiff, Edwin Gomez, appeared by guardian ad litem, who was heard on the application for the decree. How, it is quite clear that under the circumstances attending the granting of the decree, and to which we have referred, the parties to that suit cannot attack the decree collaterally. So long as it stands unreversed and unopened, a party to it cannot raise the question whether the court ought to have authorized the making of the lease, and such a number of renewals as might, and likely would, exceed the trust term. If we are right in the position taken, it is unnecessary to consider further the proposition intended as a challenge to the authority and binding force of the decree, but we may say in passing that the contention of the appellant that the granting of the lease was void, because a suspension of the power of alienation for more than two lives in being, is wholly without merit. To give a lease upon a piece of real estate does not prevent the alienation of such property. Nor is it apparent how Cuthbert v. Chauvet, 136 N. Y. 326; 49 St. Rep. 671, can, under any circumstances, be made available to appellant. It is true that the case points out that the supreme court may not compel a trustee to consent to a destruction of the trust,—a proposition certainly not applicable here. In Outhbert's Case the court, after asserting that courts of chancery have always exercised a supervisory power over the management of trust estates and the conduct of trustees, asserts that, save in exceptional cases, they have never asserted the power to dissolve a trust before the expiration of the term for which it was created. In that case the destruction of the trust had not only been attempted, but accomplished, so far as the judgment of the supreme court was concerned. The judgment had been based substantially upon the assent of the parties to the action, which was one of partition. This judgment the court held to be expressly prohibited by that part of the statute of uses and trusts which declares that every sale, conveyance, or other act of the trustee in contravention of the trust shall be absolutely void, and that the beneficiary cannot assign or in any manner dispose of his interest. This statute, the court held, was intended to take away the power of the beneficiary and of the trustee to alienate the trust property, even with the approval of the court. This was the point of the decision. In this case there was no effort in hostility to the trust. The right to lease the property for the largest amount of rent obtainable during the life of the beneficiary is not questioned. Indeed,.this was the duty of the trustees, and, had the lease provided that it, and any renewals of it, should terminate upon the death of. Hetty Gfomez, its legality weuld have been admitted. The criticism made here is that an attempt has been made to fasten a lease upon the property after the expiration of the trust. Such an act, it is clear, does not come within the condemnation of the provisions of the statute which were the subject of consideration in Guthberfs Case.

Appellants further insist that as the leases of 1852 and 1873 do not contain covenants of renewal, the lessee is not entitled to the third renewal, which the lessor in the original lease covenanted to give. The position of the learned judge at special term, which was, in substance, that the covenants of renewal contained in the lease of 1831 entitled the lessee to three renewals of each lease, and that the omission of such covenant in the renewals granted was au immaterial circumstance, has support in Kearney v. Met. El. Railway Co., 129 N. Y. 76; 41 St. Rep. 119, cited by him. But for still another reason are the covenants of the original lease binding and enforceable. The original lease has been continued in force, and in effect incorporated into and made a part of each renewal, by the insertion of a clause in the same general form as the following: “ It is mutually declared and understood by and between the parties hereto that this present indenture of lease is made and executed and given and accepted by the said parties as and for the lease or renewal for the third term o£ twenty-one years, provided for by a certain indenture of lease hereinbefore mentioned, bearing date the 1st day of November, in the year 1831, and recorded in the office of register in Liber 260 of Conveyances, p. 417."

The judgment should be affirmed, with costs, with leave to amend within twenty days upon payment of such costs together with the costs awarded at special term.

Yam Brunt, P. J.—I concur in the conclusion arrived at by Mr. Justice PARKER that under the trust deed the trustees had no power to make the leases mentioned in the complaint in this action. But I do not agree that such power, not being conferred by the trust deed, could be given by any decree of the court of chancery or of the supreme court. The action which resulted in the judgment under which the defendants claim to shield themselves was not an action for the construction of the trust deed, but to supplement the same by a decree of the court granting the trustees therein named powers which it is conceded were not conferred upon them by such deed. I know of no authority in any court to supplement by its decree for the benefit of a life tenant powers which were not conferred by the instrument creating the trust. An inspection of the decree entered in the court of chancery shows conclusively that this was the nature of the action and of the relief which was attempted to be given. The decree reads : “ This action having been brought to a hearing upon the bill and answer of the infant defendants, and on report of a master of this court to whom it was heretofore referred to ascertain and report as to the truth of the facts stated in the bill, and whether it was for the benefit of said infants that the prayer of the bill should be granted.” This alone shows that it was not an action for the construction of the trust deed. It then adjudges and decrees that the trustees and the survivor or survivors of them, and any trustee or trustees hereafter substituted, shall have full power with the consent and approbation of the complainants or the survivor of them (the complainants being the life tenant and her husband) to make and execute valid leases of the premises in question for the term of 21 years, with covenants of renewal for several successive terms of 21 years, making 84 years at all. „ In other words, the court attempted to confer powers upon the trustees which the original trust deed, it is admitted, did not do. It seems to me that the court of chancery had.no jurisdiction to entertain any such action; and that infants cannot be deprived of the possession of real estate belonging to them by any such proceeding upon the part of the life tenants for their own exclusive benefit. But it is not necessary to determine this question. There is another ground because of which the court should have refused to entertain this action. In cases of this description a court of equity only intervenes where there is no adequate remedy at law, or where irreparable damage will result. There is no allegation of irreparable damage in this complaint, and if there were it would not help the matter, because such could not be the fact. It is true that there is an allegation that there is no adequate remedy at law, but it is apparent that the plaintiff has a complete remedy at law. If he is entitled to the possession of these premises, and the action of the trustees was without authority, he may bring his action in ejectment, and recover possession, and thus be completely vested with his rights. This would require no intervention of any court of equity. There is no evidence aliunde the records which affected the question, and it is a familiar principle that equity will not intervene to remove even what is claimed to be a cloud upon a title, where the defect appears upon the face of the record which is claimed to be such cloud. The assessment cases are familiar instances of the application of this rule. Therefore there was no reason for any application to a court of equity. The plaintiff could bring his action of ejectment, and establish his rights, if he had any. The judgment should be affirmed, with costs.

Barrett, J.

(concurring).—In my judgment the court of chancery had jurisdiction to make the decree in question. Whether such decree was proper under the circumstances was a question which that court had power to decide. Were it otherwise, a court of equity could not, under any circumstances, however pressing, authorize a lease to run after the death of the life beneficiary. Equity is not thus limited. It may act upon a state of facts which would not suffice to warrant the trustee in acting without its authority. To do so may be as essential for the protection and benefit of the remainderman as of the life tenant. And in so acting it is within its general jurisdiction. There is here no direct attack upon the decree. The action is simply to prevent the last renewal, and proceeds solely upon the alleged lack of jurisdiction to make the decree which authorized it. If the appellants’ contention be correct, the apppointees may treat the decree as a nullity, and yet benefit by the situation as it comes to them thereunder. This would be inequitable. Standing solely upon the position that the decree was a nullity for lack of jurisdiction, I think the plaintiffs must fail. I therefore concur with Mr. Justice Parker. Judgment affirmed, with costs, with leave to amend within twenty days on payment of such costs, together with costs at special term.


author: Parker, J.

text:
    New York and New Jersey Telephone Company, Resp’t, v. Metropolitan Telephone and Telegraph Company, App’lt.

      (Supreme Court, General Term, First Department,

      Filed November 16, 1894.)

    Former adjudication—Appealable order.
    An order, appealable in the jurisdiction in which it was made is conclusive in this state, between the parties, as to all matters decided by the court in making it.
    Appeal from an interlocutory judgment for plaintiff, and from an order denying a motion for a new trial.

      Wheeler TI. Pechham, for app’lt; John K Parsons, for resp’t.
   Parker, J.

August 6, 1879, the Bell Telephone Company of New York (hereinafter called the “ Bell Company ”), entered into a contract with the Domestic Telephone Company, a New York corporation (hereinafter called the “ Domestic Company ”), by which the Domestic company acquired exclusive right and license to use, and rent to others to use, certain telephones under patent -owned by the National Telephone Company of Massachusetts in the district composed of the city of Newark and the townships of Harrison and Kearney, in New Jersey, for the period of five years from September 1, 1879. By the eleventh clause of such contract, it was provided as follows: “If, at the expiration of the above period of five years, the party of the first part [the Bell company] shall not desire to conduct the business of telephonic district exchange directly within said district [the Newark district] of the party of the second part [the Domestic Company], or of merging said district into some other district, but shall, on the contrary, desire to have such business conducted for it, then and in such case the party of the second part [the Domestic Company] shall have the first right of acquiring the license or agency to conduct such business, at such rate or rental and upon such terms as may then be fixed and determined by said party of the first part [the Bell company].”

The Bell company, July 1, 1880, assigned this contract to the Metropolitan Telegraph & Telephone Company, this defendant. October 2, 1882, defendant and the New, Jersey Telephone Company, a New Jersey corporation, subsequently consolidated with plaintiff (which shall hereinafter be spoken of as the “ plaintiff ”), made a contract which in part consisted of a license to plaintiff to use and license telephones in certain territory in New Jersey, other than, but surrounding, the Newark district. This contract, after reciting the agreement between the Bell company and the Domestic company, contained the following provision: “ Now, it is agreed that the second party [the New Jersey company] shall have, and the first party hereto [this defendant] hereby assigns and sets over to the second party, all the right, title, and interest, and benefit of the first party hereto of, in, to, and under the said license agreement with the Domestic Telegraph and Telephone Company, whether under or in pursuance of said agreement with said Bell Telephone Company of New York, or otherwise, howsoever, subject, however, to the burdens and obligations resting on the first party hereto under the same; it being, however, expressly understood and agreed that at the expiration of the present term of said license agreement, to wit, on the first day of September, A. D. 1884, the territory covered thereby shall come under the license contract hereto annexed, and be merged with the territory covered thereby, unless by the terms thereof said Domestic Telegraph and Telephone Company shall have the right to compel, and shall compel, an extension or renewal thereof, in which event said territory shall, upon the expiration of such extension or renewal, come under the license contract hereto annexed, and he merged with the territory covered thereby.”

Thereafter, by a decree of a New Jersey court of chancery, the defendant was required to give the Domestic company an extension of its contract for a period of five years, and the defendant, made performance in accordance with such adjudication. Plaintiff at once took the position that the extension of the contract with the Domestic company for a period of five years was in violation of defendant’s contract with it; that the agreement provided that, the Newark territory should come under the license contract., unless by the terms thereof (agreement, August 6, 1879), the Domestic Company shall have the- right to compel, and shall compel, an extension or renewal thereof. The extension compelled, it. urged, was not because of the terms of the contract of August. 6, 1879, but because of a subsequent paroi agreement entered into between the parties, by which it was understood and agreed that, if the Domestic company would furnish the money necessary to pay the Western Union Telegraph Company for a telephone plant owned by it in Newark, an extension of its contract for a period of five years should be granted. It was further insisted on the trial at special term that the New Jersey court of chancery had passed upon the issues, presented by the pleadings, in plaintiff’s favor in a suit to which both plaintiff and defendant were parties. By reason of such adjudication, it contended that the defendant was estopped from further-questioning the matters decided. The learned judge, at special term, conceded to plaintiff’s contention in such respect much of force, but rested his decision in favor of plaintiff upon the ground that the contract between plaintiff and defendant gave to the former the right to the Newark territory, unless, by the terms of the contract made between defendant and the Domestic Company, the latter had a right to and did compel a renewal of its license and contract, and that, by the terms of the contract of 1879, the Domestic Company had no such right.

We are of the opinion that the question to which the learned counsel for the appellant invites our attention has already been passed upon by the New Jersey court of chancery, and is, therefore, just as effectual as an adjudication and an estoppel as if it had been the subject of like disposition in the courts of this state. The record of all the proceedings had in the court of chancery is before us, and counsel for both parties invite our consideration of the several opinions delivered. At the expiration of the term provided by the contract of August 6, 1879, the plaintiff claimed the right to the possession and use of the telephone property in Newark. Thereupon the Domestic Company commenced a suit in equity, in which it made defendants both this plaintiff and this defendant. The bill, among other things, set up the contract of August 6, 1879, and a demand on its part for an extension of the contract for another term of five years; and it contained a prayer that the Metropolitan Company be-compelled to specifically perform such contract by granting to the complainant a new license, “ upon such terms as may be determined by the court; ” as ancillary to such relief, that, pending litigation, an injunction issue, restraining the defendants from removing the telephones in complainant’s possession, and from interfering with its business in such district. The joint and several answers of the defendants, among other things, contain the following: “ These defendants, in further .answering, say that paragraph eleven of the contract of August 6, 1879, under which the complainant claims a renewal of said contract or further license, is not binding as a contract or of any legal force, and is not enforceable in equity or in law, and this court can make no decree to compel a specific performance of the same. These defendants also say that the clause in the memorandum of agreement referred to in regard to the preference in making any contract at the termination of the agreement is of like character, and not enforceable inequity or in law.”

Upon the bill, answers and affidavits, a motion for an injunction was heard. Defendant’s, answer, challenging the validity and enforceability of the contract, which plaintiff wholly relied on to-establish its cause of action, required and received careful consideration at the hands of the vice-chancellor. The court, in a somewhat lengthy opinion, discussed the question whether, under the contract, the plaintiff was entitled to a renewal of the lease. The-conclusion was reached that the provision which was the subject of consideration could not be specifically enforced by a court of equity, and the opinion concluded as follows: “ It is true that in-cases of this kind, where an injunction is sought in aid of an action for specific performance, that the court will, as a general rule, if the plaintiff’s case is strong enough to render it at all probable that he may, on final hearing, be able to convince the court that he is entitled to relief, award an injunction; but in-cases where there is no doubt, where it is clear that the contract sought to be enforced has not yet been made, or, if it has been made, that it is so incomplete and uncertain that it cannot be enforced, an injunction must be denied, for the very obvious reason that the complainant has no equity which entitles him to the writ.” Domestic Tel. & Tel. Co. v. Metropolitan Tel. & Tel. Co., 39 N. J. Eq. 160.

On appeal to the court of errors, the appeal and .order was affirmed by a divided court; the minority, in a dissenting opinion written by one of their number, insisting that the complainant was entitled to some relief under the eleventh clause of the contract, and, therefore, an injunction ought to have been allowed. From the pleading and orders and opinions it is clear that the-only question either considered or decided was the enforceability of the eleventh clause of the contract, and that issue was presented by the answer of this defendant in' an action to which it was a party. As between it and the other parties to the suit, the-question considered, and the only one, was, therefore, res adjudi cota. Bangs v. Strong, 4 N. Y. 315; Ashton v. City of Rochester, 133 id. 187; 44 St. Rep. 526; Culross v. Gibbons, 130 N. Y. 447-454; 42 St. Rep. 527; Smith v. Zalinski, 94 N. Y. 518-521; Demarest v. Darg, 32 id. 281-290; Burhans v. Van Zandt, 7 id. 523. Our attention has not been called to any decision holding that such an order is not conclusive as to any fact as to which the party had a hearing, and which the court passed upon. Riggs v. Pursell, 74 N. Y. 370, is the first case cited by the appellant contra. That case recognized a change in the rules relating to orders made on motion, as estoppels occasioned by the provision of the Code giving the right of appeal from orders. The first decision in the court of appeals on that subject was Dwight v. St. John, 25 N. Y. 203. This case was referred to in the opinion in Riggs Case, and of it in part it was said that the familiar right of a party to renew a motion upon a different state of facts, or by supplying defects in proof, is not in any manner questioned or impaired by the decision. In the Riggs Case the court held that it was not precluded by its former decision from considering certain additional and material facts, which were not before the court or passed upon in the first motion, This case was brought to the attention of the court in Smith v. Zalinski, supra, in which it was held that where, after issue has been joined in an equity action, the plaintiff transfers his-interest, the transferee may move to be substituted as plaintiff; and where such motion is made upon notice to the defendant, and an order of substitution is granted without directing supplemental pleading, or an amendment of the complaint, the question as to title in the substituted plaintiff is determined by the order, arid may not be raised upon the trial. The court said: “ But the learned counsel for the appellant, citing Riggs v. Pursell, 74 N. Y. 370, insists that such an order is not final and conclusive in an after controversy. That is true in the sense explained by that decision. That the motion may be renewed with the consent of the court, and even without that consent upon a new and different state of facts; that, where the motion was litigated, a matter not necessarily involved in it, and not in fact litigated, is not concluded by the order,—this court certainly held. ■* * * Ow'nership was the one vital question involved in that motion and its decision. * * * [The order directing substitution] is not weakened by the fact that defendant made default. The court had a right to assume that the alleged ownership was conceded and that no issue was raised over it.”

In Webb v. Buckelew, 82 N. Y. 555, the question presented was whether an interlocutory order or decree in an equity action, from which, by the provisions of the Code, appeal is postponed ■until final judgment, is conclusive between the parties and privies. It was held not, and the learned author of the opinion, when writing in Smith v. Zalinski, omitted to refer to it as bearing upon the question then being decided, probably for the reason that he did not consider it in point. Certainly, the distinction between the two cases is marked. When an order is made from . which it is provided an appeal may be taken, there is every reaeon why the determination of the court, which results in the order, should be binding upon all the parties to the action or proceedings ; and to such effect are the authorities. But an interlocutory decree or order, which may not be appealed from until after final judgment, is a mere step in the proceedings, ultimately to ripen into a judgment, which may be reviewed; and the force and effect of a final adjudication should not be given to it, for the party defeated by the order or decree has yet the right to have it reviewed, and, so long as that right remains, nothing is finally or conclusively settled. The final determination of the New Jersey court of chancery was just as effectual as an adjudication and estoppel as if it had been rendered by the courts of this state. Dobson v. Pearce, 12 N. Y. 156; Revere Copper Co. v. Dimock, 90 N. Y. 33.

April 6, 1885, the bill of complaint was amended, pursuant to an order of the chancellor, by the insertion of an averment, in effect, that, after the execution of the contract of August 6, 1879, the Bell Company, with the knowledge and assent of the defendant, independently contracted with the Domestic Company to renew its license in the Newark district for a further term of five years, upon certain conditions, which were duly provided by the Domestic Company. Upon this amendment issue was joined, and subsequently such proceedings were had as resulted in a decree, wherein it was adjudged, among other things, that subsequent to the making of the contract of August 6, 1879, and on or about the 16th day of April, 1880, the Bell Company and the Domestic Company entered into a supplemental verbal agreement that in consideration of the purchase by the Domestic Company of the telephonic plant and business operated in Newark by the Western Union Telegraph Company, if the Bell Company, at the expiration of the original contract, should exercise the option of purchasing the plant and business established by the Domestic Company, in accordance with the terms of the contract, it would also purchase of such company the Western Union plant in said city, upon the same terms; if it determined not to conduct directly such telephone business in the Domestic Company’s district, it would renew the Domestic Company’s contract of August, 1879, for the additional period of five years, upon the same terms as provided in said contract. It was futher adjudged that the complainants were entitled to a specific performance of said contract, and it was decreed that the defendant execute and deliver to the Domestic Company a new license or contract, to run for five years from the 1st day of December, 1884, with terms the same as provided in the contract of August 6, 1879. The opinion of the court is reported in 41 N. J. Eq. 241. An appeal was taken to the court of errors and appeals, where the decree was affirmed. Metropolitan Tel. & Tel. Co. v. Domestic Tel. & Tel. Co., 44 N. J. Eq. 568. That court reached the conclusion that the committee which purported to represent the Bell Company were without authority to bind the Bell Company, but that the Domestic Company accepted the proposal then made, and thereafter, and in .accordance therewith, furnished the sum of $11,500, necessary to purchase the plant of the Western Union Company; that the act of the Domestic Company in performing that condition was accepted as to ratify and validate the unauthorized acts of the executive committee in proposing the contract upon that condition, and also to estop the Metropolitan Company from denying the existence of the contract and its binding force on that company. The opinion concludes : For these reasons a contract came into-“existence between the parties, which ought, in equity, to be preformed according to its terms.” Thus, it was established by the decisions of the court having jurisdiction of the parties (1) that,, by the terms of the contract of 1879, the Domestic Company had not the right to compel the Bell Company (or its assignee, this defendant) to renew its contract; (2) that the contract of renewal made with the Domestic Company was in pursuance of the subsequent verbal arrangement, which persuaded the Domestic Company to so act as to estop the Bell Company and its assignee from refusing to carry out the agreement.

The appellant contents that, notwithstanding the agreement between it and the plaintiff provided that the Newark territory should come under the license contract, “unless, by the terms-thereof [referring to the contract of August, 1879], the Domestic-Company shall have to right to compel, and shall compel, an extension or renewal thereof” it should be more broadly construed, and that such a construction as the appellant contends for is in fact required by the surrounding facts and circumstances, which should be considered, by the court; and, further, that it was error to hold that the supplemental verbal agreement found by the final decree in the New Jersey suit constituted a breach of the agreement of October, 1882. But, if we are right in the view we have expressed,—that it has been determined in the New Jersey chancery court, to which the plaintiff and defendant were parties, that the Domestic Company had no right to compel an extension of the agreement of August, 1879,—-the defendant is now estopped from questioning it.

The judgment should be affirmed, with costs.

All concur.


author: Yan Wtck, J.

text:
    Julius Frendenheim, Resp’t, v. Julia Raduziner, App’lt,

      0New TorTi City Court, General Term,,

      Filed December 17, 1894.)

    Judgment—Offer of judgment.
    Where the defense of part payment by note is interposed in an action for the price of goods sold and an offer for the balance, with interest and costs is made and accepted, an entry of judgment on such offer and acceptance bars a recovery of such residue in that action.
    Appeal from a judgment, directed for plaintiff on a trial by the court without a jury.

      W. F. Severance, for pl’ff; A. IT. Berrick, for def’t.
   Yan Wtck, J.

The alleged cause is goods sold and. delivered to defendant, of agreed price of $728.97; and the answer specifically admits this, and alleges that the defendant paid plaintiff on account thereof $560, by her certain promissory notes. The defendant, with her answer, served on October 20,1894, a written offer to allow judgment for $170, interest, costs, and disbursements, and the plaintiff thereafter, on October 24th, served a written acceptance of this offer, and upon November 2d he entered judgment upon this offer and his acceptance thereof for $192.28. However, before entry of this judgment, plaintiff obtained, on November 1st, an order permitting him to enter judgment for $170, with interest and costs, and to continue his action for the recovery of the balance. Appellant contended at trial that this offer of judgment, acceptance thereof, and the entry of judgment thereon, was a bar to plaintiff’s recovery of the balance of his claim in this action, and this contention seems correct, for the court had no right to grant this order of severance, upon the facts as disclosed in the papers upon which it was obtained. Appellant’s counsel contends “ that if defendant’s contention be sustained the result will necessarily be that plaintiff will lose $550 of a debt admitted to be just, and for which plaintiff holds defendant’s notes ” (this is not so, for he still can sue on the notes), and, in addition, that the plaintiff will be mulcted in a large sum for costs.” But even so, this will be due to the mistaken practice of his counsel; and, moreover, if plaintiff’s contention is sustained, the defendant will be mulcted in costs, and not because of any mistake made by her or her counsel. The judgment should be reversed, and a new trial granted, with costs to appellant to abide the event.


author: Conlan, J.

text:
    Pearce & Miller Engineering Company, Resp’t, v. George H. Brouer et al., App’lts.

      {New York City Court, General Term,

      Filed December 17, 1894.)

    1. Bills and notes—Bona fide holder.
    The transfer of a note before maturity, as collateral security for moneys advanced or loaned in good faith, constitutes the transferee a bona fide holder to the extent of such advance or loan.
    2. Trial—Direction of 'verdict.
    Where both plaintiff and defendant ask for a direction of verdict, they waive the right to have the questions of fact passed upon by the jury.
    Appeal from a judgment entered on a verdict directed by the court in favor of plaintiff.

      Cantor & Van Schaich, for app’lts ; John F. Booth, for respt.
   Conlan, J.

The question presented on this appeal is whether the plaintiff was the bona fide holder of the note in suit to the ■extent of the money actually advanced upon it, and for which it was held by him as collateral security. The transfer of a negotiable protnissory note before maturity as collateral security for moneys advanced constitutes the transferee a bona fide holder when the loan or advance -was made in good faith. Brookman v. Metcalf, 32 N. Y. 596; Belmont Branch Bank v. Hoge, 35 N. Y. 65. If the holder of such paper has paid but a part of the- consideration or value, he is entitled to be considered a bona fide holder pro tanto (Huff v. Wagner, 63 Barb. 215), and may recover his actual payment ( Williams v. Smith, 2 Hill, 301). The evidence of the plaintiff, by William H. Stalmaker, its secretary and! treasurer, is to the effect that about the 23d or 24th of December, 1892, one Mr. Starr, who was then indebted to the plaintiff for moneys previously advanced, in the sum of $385, brought to plaintiff the note in suit, “ dated Dec. 12, 1892, whereby defendants promised to pay to the order of themselves, three months after date, $1,000, value received,” signed “ Brouer & McGown,” and also indorsed Brouer & McGown,” and wanted a further advance of $75, which plaintiff let him have, upon receiving the note as collateral security for the $385 previously owing and for the $75 then advanced. The note was not paid at maturity, and the plaintiff, by producing the, note on the trial, established a prima facie right to recover the $75 actually advanced on the faith of the security. The defendants introduced evidence to show that the note was made without consideration, and delivered to Mr. Starr, the person who pledged same with plaintiff, to be procured to be discounted, and the avails turned over to the defendant. This evidence tended to show a diversion of the note, and imposed upon the plaintiff the burden of showing good faith. This was a question which properly belonged to the jury, but, inasmuch as both plaintiff’s and defendants’ counsel asked for a direction at the close of the case, they waived the right to have the questions of fact passed upon by the jury, and, as there is evidence to sustain the direction of the court below, the judgment must be affirmed, with costs.

All concur.


author: OoNLAN, J.

text:
    Frederick W. Prior, App’lt, v. Henry M. Flagler, Resp’t.

      {New York City Court, General Term,

      Mled December 17, 1894.)

    Principal and agent—Authority.
    An agent is not authorized, by reason of his having concluded the details of a contract of employment, to make a subsequent contract that, if the employe would resign, his salary for the balance of the term should be paid.
    Appeal from a judgment, dismissing the complaint at the close of plaintiff’s case.

      Dudley B. Horton, for app’lt; Leavitt, Wood & Keith, for resp’t
   OoNLAN, J.

The only question presented on this appeal is whether Tomlinson had authority to make the contract sued on. The plaintiff was employed as chief cook in defendant’s hotel for the season of 1892-93. The evidence shows that plaintiff’s employment originated with a Mr. Seavey, who was general manager of the hotel, and concluded as to details with one Tomlinson, who was acting in the capacity of steward. The evidence shows that shortly after plaintiff’s employment he was injured so badly that he was unable to continue his duties as chief cook, and was taken to a hospital, when, as plaintiff claims, an agreement was made with the steward, Tomlinson, that, if plaintiff would resign this position, the balance of his salary for the season would be paid him. This was an entirely new and independent contract, and, to be binding on the defendant, must be made by some person having authority to make it. We do not think that authority-in Tomlinson was shown, and it follows, therefore, that the evidence as tot he terms of the agreement was properly excluded. At the close of the plaintiff’s case the court offered to submit the questions of fact to the jury, which was declined by plaintiff’s counsel. Ko errors of law appear in the case, and the complaint was properly dismissed. Judgment affirmed, with costs.


author: Van Wyck, J.

text:
    David Boyd, as Administrator, etc., App’lt, v. Robert Boyd, Resp’t.

      (New York City Court, General Term,

      Filed December 17, 1894.)

    Appeal—First instance.
    An objection that a motion for a new trial, made on a transcript of the entire evidence and proceedings on the trial, should have been made on a case settled, cannot raised for the first time on appeal.
    Appeal from a motion granting a new trial.

      Geo. A. Taylor, Jr., for app’lt; Henry Daily, Jr., for resp’t.
   Van Wyck, J.

The plaintiff’s alleged cause is upon a judgment previously obtained by his intestate against this defendant while defendant’s alleged defense was payment of the same to said intestate. At trial, when defendant offered to make proof of such payment, he was met with a judgment roll filed in an action in the superior court, wherein he was plaintiff, and the plaintiff herein was one of the defendants therein, by which it was adjudged, by the fifteenth and seventeenth findings of fact, that the very judgment herein sued .upon “is still unpaid; ” and it was held that he was estopped by such judgment from making proof of such payment, and of course the verdict was directed for plaintiff. Thereafter this defendant, as the plaintiff in the superior court action, applied to and obtained from that court an annulment of those two findings of fact, after notice to this plaintiff as one of the defendants therein, and then moved at ’the special term of this court, before the very justice who had presided at the trial of this cause, for a new trial on the ground that such annulment set at large the estoppel which existed at trial, and prevented him from proving such payment of the judgment. This motionfor new trial was granted upon payment of all costs to date, thus applying the rule as laid down.in Smith v. Frankfield, 77 N. Y. 414, that if a judgment is rendered upon the strength of a judgment in some other action, which is afterwards reversed, such reversal is sufficient ground for a new trial, but should be on terms. This appeal is from such order granting new trial, and appellant contends that it should be reversed because the motion was not made on a case made and settled. The record shows that the motion was heard and determined upon two affidavits, the findings of fact by the superior court, the subsequent order of such court striking out the two findings which raised the estoppel, and a transcript of. the entire evidence and proceedings as taken on the trial. Assuming, not conceding, that this was a motion that should have been made upon a case settled, still, the appellant not disputing and the judge, who also tried the cause, asserting, the correctness of this transcript of the entire evidence and proceedings taken at trial, the same will be deemed a sufficient settlement under the peculiar circumstances of this case. The defendant certainly should have a new trial, and the order granting him such is affirmed, with $10 costs.

All concur. ■


author: O’Brien, J.

text:
    Importers and Traders’ National Bank of New York, Resp’t, v. Cebra Quackenbush, Impleaded, etc., App’lt.

      (Court of Appeals,

      Mled December 18, 1894.)

    1. Supplementary proceedings—Execution.
    The issuance and return of an execution unsatisfied, after the judgment ceases to be a lien on real estate and chattels real, furnish no basis for supplementary proceedings.
    2. Same.
    The execution, required as a.basis for supplementary proceedings, is the one prescribed by § 2458 of the Code.
    Motion for reargument.

      A. R. Dyelt, for motion; Abraham Lansing, opposed.
   O’Brien, J.

Upon a motion for a reargument, the learned counsel for the plaintiff calls our attention to two facts which he claims have been overlooked in the disposition of the case, but which, we think, are covered by the opinion. The first is, that no execution was issued in one of the cases to the county of Albany, the county of the residence of the judgment debtor, until March, 1894. We did not overlook that fact, but did not regard it as material; since, when it was issued, the judgment was not a lien on any real property in that county, and could not be effective to exhaust the remedy at law. Besides, if an execution had been issued to another county more than ten years before, which complied with § 2458 of the Code, and entitled the plaintiff to institute the proceedings, then that would set the bar of the statute running. If it was not such an execution, the second one was ineffectual to exhaust the remedy at law.

The next point is, that we have overlooked the fact that § 1252 requires nothing more, so far as the plaintiff is concerned, to revive the lien of the judgment, than the delivery of an execution to the sheriff, and then that officer must himself do the things required by that section to make the execution effective. We do not think that the plaintiff’s counsel is correct in that contention ; but it is not very material, since' neither the plaintiff nor the sheriff did, in fact, comply with it. It matters little upon whom the duty rested of preparing, filing and procuring the notice to be recorded which is required by that section, so long as it was not done. But we think that, even if it had been complied with, that section furnishes no sufficient basis for the proceedings. The •execution required is not that prescribed by § 1252, but by § 2458. The former section provides for a proceeding to sell specific property, and is not mentioned in § 2435 as one of the conditions to be complied with in order to entitle the creditor to maintain the proceedings.

The motion for reargument must be denied, with ten dollars •costs.

All concur. Motion denied.


author: Bartlett, J.

text:
    Aaron R. Stevens et al., Resp’ts, v. Central National Bank of Boston et al., Impleaded, etc., App’lts.

      (Court of Appeals,

      Mled November 27, 1894.)

    1. Injunction—Courts.
    Where both parties to a suit in a foreign country are residents within the territorial limits of another country, the courts of equity in the latter may act in personam upon those parties, and direct them by injunction to proceed no further in such suit.
    3. Same.
    In such case, a- court of this state has the right to enjoin a sale under a decree of a Federal court, which was based upon a judgment of a state court which has been set aside.
    3. Same.
    All that can be claimed for such decree is that it be accorded the same force and effect as a similar judgment of the supreme court of this state.
    •4. Railroads—Action to set aside foreclosure sale.
    A bondholder, secured bjr a railroad mortgage, may sue to set aside a foreclosure proceeding, instituted by other bondholders and to which he was not a party, on the ground that it was fraudulently brought.
    •5. Same.
    Such suit, if cqmmenbed within two years after the sale in the prior action, is seasonably brought.
    6. Same—Priorities.
    The priorities as between certain railroad bondholders and holders of receiver’s certificates, issued in an action to which such bondholders were not parties and which was fraudulently instituted by other bondholders, determined.
    Appeal from a judgment of the general term of the supreme court, affirming the judgment of the special term.

      Matthew Hale, for app’lts; Edward Winslow Paige, for resp’ts,

      Affirming, 52 St. Rep. 894.

   Bartlett, J.

This appeal involves a contest between the bondholders and holders of receiver’s certificates of the Lebanon ^Springs Railroad Company and its successor, the Harlem Extension Railroad Company.

A recital of the main facts in this litigation is essential as it will present clearly the questions of law submitted for our determination.

The Lebanon Springs Railroad Company, in 1869, was operat- ' ing its completed road from Chatham, New York, to Bennington, Vermont; prior to that time, in July, 1867, it issued and sold its bonds to the amount of two millions of dollars, and secured the same by mortgage to the Union Trust Company of New York, in trust, covering its property, rights and franchises.

Early in the year 1870, the Lebanon Springs Railroad Company consolidated with the Bennington and Rutland Railroad Company, of Vermont, and the new corporation took the name of the Harlem Extension Railroad Company.

This latter company in April, 1870, made its mortgage to the Union Trust Company of New York, in trust, to secure the payment of four millions of dollars of its bonds, but only one million four hundred thousand dollars of this issue were negotiated.

In February, 1872, the Union Trust Company began "the foreclosure of the first named mortgage in the supreme court of New York, and later in the same year it filed bills in the court of chancery of Vermont to foreclose both mortgages in that jurisdiction.

In December, 1872, and while the suits mentioned were pending, the Harlem Extension Railroad Company consolidated with corporations, not material to mention in this connection, and assumed the name of the New York, Boston and Montreal Railway Company.

In January, 1873, the property covered by the two million mortgage in this state was sold and conveyed, in the Union Trust Company foreclosure suit, to James C. Hull, a clerk in the office of defendant William Butler Duncan, for the nominal sum of one hundred thousand dollars, and about the same time there were sales under the Vermont decrees and conveyances executed to Charles G. Lincoln, a clerk for one TrSnor W. Park, for the nominal sum of fifty thousand dollars.

It is found in this action that the Union Trust Company never did anything to enforce the payment of these bids, and that they were never paid.

.On the 28th of February, 1873, Hull and Lincoln, without any consideration, executed to the defendant William Butler Duncan and one Trenor W. Park a bond for the payment of five millions of dollars, secured by mortgage covering the property conveyed to them under the foreclosure sales in New York and Vermont.

It is found in this action that both Duncan and Park knew that the consideration for the deeds to Hull and Lincoln remained unpaid. On the 30th of January, 1873, Hull and Lincoln conveyed the property without consideration, and subject to the Duncan and Parir mortgage, to the New York, Boston and Montreal Railway Company.

The five million dollar mortgage made to Duncan and Park represented substantially the aggregate indebtedness which the New York, Boston and Montreal Railway Company was to assume under the consolidation and other agreements.

The latter, company paid to Duncan and Park $807,077.05 on account of the money due on said mortgage, but failed to pay the balance, became insolvent, and, in April, 1875, Daniel Butterfield was appointed, by the supreme court of the state of New York, receiver of all its property and effects.

During the year 1873 the New York, Boston and Montreal Bailway Company executed to Seligman, Sherman and Brown a mortgage to secure bonds to the aggregate amount of twelve millions two hundred and fifty thousand dollars; also another mortgage to the New York Loan and Indemnity Company to secure the payment of additional bonds to the aggregate amount of twelve millions seven hundred and fifty thousand dollars.

A sufficient amount of these bonds were sold in Europe to realize six millions of dollars.

In November, 1873, the New York, Boston and Montreal Bailway Company leased its road to the Central Vermont Bail-way Company, which lease was operated until August 20, 1877, when it was abandoned.

In the meantime the lessor company had become insolvent, as already stated, and in September, 1877, one Bussell C. Boot took possession of the property without legal right, and, subsequently, on November 27th, 1877, delivered possession thereof to a corporation called the Harlem Extension Bailroad South Coal Transportation Company.

Boot, in the name of this company, and as its president, continued to operate the road until possession was taken from him by the court, as will presently appear.

In September, 1880, one Marvin Sackett, a bondholder of the Lebanon Springs Bailroad Company, brought an action in the supreme court of New York against Bussell C. Boot, the Harlem Extension Bailroad South Coal Transportation Company, the New York, Boston and Montreal Bailway Company, and Daniel Butterfield as its receiver. Sackett alleged in his complaint that he brought the action in behalf of himself and all other bondholders of the Lebanon Springs Bailroad Company, similarly situated, who hold any of the two millions of dollars of the bonds of the Lebanon Springs Bailroad Company, hereinafter referred to, and who shall be entitled to avail themselves of the benefit of this suit.”

The complaint further alleged the mortgage, to secure plaintiff’s bonds to the Union Trust Company of New York, the action to foreclose, the sale thereunder, and the non-payment of the purchase money to the trustee.

In brief, the Sackett suit was ostensibly a representative action for the benefit of bondholders, and sought, apparently, to charge Duncan, and his clerk, Hull, who took title at the foreclosure sale in this state, as trustees for the bondholders. The complaint further prayed for a receiver, a sale of the property, that all titles under the foreclosure sale should be declared void, and for such other relief as was just.

It will be observed that while the Sackett suit professed to seek the objects indicated, that it failed to bring before the court the necessary parties to render such a decree as was prayed for binding, viz. : The Union Trust Company of New York, Duncan, Park, Hull, Lincoln and the trustees under the mortgages.

The record in the Sackett suit also discloses some other remarkable features.

In October, 1880, John Van Valkenburgh was appointed, receiver. Intermediate the appointment of the receiver and Feb. 1st, 1881, holders of large amounts of both Lebanon Springs and Harlem Extension bonds petitioned the court in two separate proceedings to be made parties to the action, but both applications were denied. After the denial of these motions and in Feb., 1881, the receiver petitioned for instructions, and suggested that he issue certificates to be made a first lien for, among other things, the “settlement of unavoidable indebtedness of the company now existing.” . April 2d, 1881, after the coming in of the report of an expert to examine the railroad, and no one appearing except the receiver’s counsel, the receiver was ordered to issue certificates of indebtedness to the amount of $350,000, anda referee was appointed “ to hear and determine all existing claims against said Lebanon Springs Railroad Company.” The-receiver had previously borrowed twenty-five thousand dollars without authority of the court. The disposition made of a portion of the proceeds realized by the sale of the receiver’s certificates will be considered later.

The Sackett suit did not reach final judgment until January, 1885, after a delay of between four and five years. Later in 1885 the referee under the judgment sold the property to William Foster, Jr., for $155,000.

The action at bar was begun in the supreme court of Hew York, April, 1887, by bondholders owning bonds of both the Lebanon Springs R. R. Company and the Harlem Extension R. R. Company.

The complaint brings in all the parties in interest; it seeks to enforce the foreclosure judgment and decrees of 1872 in the suits instituted by the Union Trust Company of Hew York both in Vermont and this state ; it is also in the nature of a- bill of review of the judgment in the Sackett suit and a bill for relief against the judgment and proceedings in that suit as fraudulent; it also seeks the foreclosure of all junior liens.

The special term, on Hovember 10, 1891, rendered a judgment for the plaintiffs in this action, a sale of the property was made by the referee, and on the 16th of May, 1892, William Foster, Jr., received a deed as purchaser.

This judgment was affirmed by the general term of the third department.

It now becomes necessary to consider the manner in which this appeal is presented.

In 1886, and before the case at bar was begun, one of the defendants in this action, the Central Hational Bank of Boston, on behalf of itself and all other holders of the receiver’s certificates issued under the judgment in the Sackett suit, brought an action in the supreme court of Hew York against Foster and Hazard, the purchasers under the Sackett judgment, and a corporation called the Hew York, Rutland and Montreal Railway Company, their grantee. The complaint in this action recited in detail the proceedings in the Sackett suit which led to the issuing of receiver’s certificates, alleged that the Central Hational Bank of Boston held $250,000 par value of the same, and that the balance of certificates were owned by divers persons and corporations.

It was also alleged that Hazard and Foster, when purchasing under the Sackett judgment, had assumed and agreed to pay the amount of unpaid principal and interest on said certificates of indebtedness after application of the purchase money.

It prayed that the certificates be declared a first lien on the property; that a receiver be appointed, property sold, and Hazard and Foster adjudged to pay deficiency. This suit was removed into the United States circuit court on petition of the defendants on ground of citizenship of parties.

On the 2ith of March, 1887, a decree was entered in favor of plaintiffs and a sale of the property ordered.

Within thirty days after the entry of this decree the action at bar was begun and proceeded to judgment before sale under the Federal decree, which did not take place until 1892.

The defendants appealing from the judgment in the action at bar are the certificate holders, and the only questions presented are on their behalf.

It is urged by the learned counsel for the appellants that the judgment appealed from is erroneous in perpetually enjoining the appellants from proceeding with the sale of the premises under the decree of the circuit court of the United States; also, in authorizing the referee to determine who were the owners of receiver's certificates; also, on the merits, and that the motion to dismiss the complaint should have been granted.

The appellant’s counsel insists that the case presents a conflict of jurisdiction between the state and Federal courts, and that the injunction clause of the judgment which perpetually enjoined and restrained the Central National Bank of Boston and other certificate holders from proceeding with the sale under the United States circuit court decree was an unlawful interference with the due and orderly procedure of a suit in which the Federal court had first acquired jurisdiction of the subject-matter. We have been cited to many cases in the state and United States courts dealing with this question of concurrent jurisdiction and declaring well-settled principles that govern the procedure under such circumstances.

We do not consider that such a question is presented in this case, but are of opinion, assuming that the Sackett suit is fraudulent, that it was competent for the supreme court of New York in the action at bar to bring before it all the parties in interest and to review the judgment in the Sackett suit, to vacate it as fraudulent and to deal as a court of equity with the holders of the receiver’s certificates issued under the Sackett judgment. It must be admitted that the United States circuit court had jurisdiction of the subject-matter in the suit referred to, and that its decree was proper and binding upon the parties before it.

There,is nothing in the judgment at bar that attacks the jurisdiction of the United States circuit court or questions the legality of its decree.

The suit in the United States circuit court was founded upon the judgment and orders in the Sackett suit, aud sought as against the defendants therein to enforce their provisions ana to secure to the certificate holders those rights as to priority of lien and personal'judgment against Hazard and Foster, to which the Sackett judgment entitled them.

It was after the decree of the United States circuit court was rendered that the supreme court of New York, sitting as a court of equity, assumed jurisdiction of all the parties connected with this long and complicated contest, and undertook to adjust their rights and interests.

In so doing it rendered its judgment reviewing and reversing the Sackett judgment, setting aside the sale and referee’s deed to Hazard and Foster under it and enjoining the certificate holders from proceeding with the sale under the United States circuit court decree.

It is thus apparent that if a court of equity, having jurisdiction of all the parties, was to give complete relief in dealing with the entire subject-matter, it must restrain the certificate holders from proceeding with the sale under the decree of the United States circuit court, as the foundations of that suit had been utterly swept away by the judgment in the action at bar. Unless this power existed in the supreme court of the state of New York it was powerless to adjust the conflicting interests submitted for its consideration.

We think it is clear, both upon principle and authority, that this power did exist, and that the sale under the decree of the United States circuit court was without force or effect as to the parties in that suit, as they proceeded in violation of the injunction contained in the judgment at bar. The setting aside oí the judgment in the Sackett suit, upon which the suit in the United States circuit court was founded for fraud, was a new fact occurring since the decree in that court which gave jurisdiction in this action to enjoin proceedings thereon.

Judge Story (2 Eq. Jur., § 899,13th ed.) uses this language in regard to foreign courts, but it is equally applicable to state and Federal courts, viz.:

“ Although the courts of one country have no authority to stay proceedings in courts of another, they have undoubted authority to control all persons and things within their own territorial limits. When, therefore, both parties to a suit in a foreign country are residents within the territorial limits of another country, the courts of equity in the latter may act in personam, upon those parties, and direct them by injunction to proceed no further in such suit.
“ In such a case these courts act upon acknowledged principles of public law in regard to jurisdiction.
“ They do not pretend to direct or control the foreign court, but, without regard to the situation of the subject-matter of the dispute, they consider the equities between the parties and decree in personam according to those equities and enforce obedience to their decrees by process in personam."

This is the acknowledged rule in England and this country.

In the case of Barry v. Brune, reported below in 8 Hun, 395, and affirmed by this court (71 N. Y. 262), this rule was acted. upon, and the supreme court of this state enjoined the parties before it from collecting a judgment recovered in the United Stated circuit court for the district of Maryland. See, also, Mead v. Merritt, 2 Paige, 404; Dehon v. Foster, 4 Allen, 550; Savage v. Allen, 54 N. Y. 458; N. Y. & Harlem R. R. Co. v. Haws, 56 id. 175; N. Y. & N. H. R. R. Co. v. Schuyler, 17 How. 464, 468; Carron Iron Co. v. McClaren, 5 H. L. C. 439, and English cases there cited.

Passing from this point it should be remembered that the suit of the Central National Bank of Boston was begun in the supreme court of New York and was removed into the United States circuit court on the ground of citizenship of parties.

All that can be claimed for the decree of the latter court is that it be accorded the same force and effect as a similar judgment of the supreme court of New York. Dupasseur v. Rockereau, 21 Wall. 130, 134; Crescent Live Stock Co. v. Butchers' Union, 120 U. S. 141, 147. It cannot be doubted that if the Central National Bank of Boston had proceeded to judgment in the supreme court of New York that the judgment in the case at bar would have dealt with that judgment precisely as in did with the decree in the United States circuit court.

We will now consider the disposition of this case by the court below, on the merits.

An examination of the evidence satisfies us that the findings of fact are abundantly sustained.

The fifth and sixth findings of fact are to the effect that the suit of Sackett was neither brought nor conducted for the purpose of realizing the property to the owners of the Lebanon Springs bonds, but that it was brought and conducted for the purpose of realizing-out of the property certain individual claims of Sackett and Tilden in preference to, and at the expense of the other Lebanon Springs bondholders, which claims, if valid, were not liens upon the property and were behind the mortgage. It appears that these claims exceeded thirty thousand dollars, and the aggregate fees of counsel and receiver were about sixty-one thousand dollars, all of which were paid out of the proceeds realized by the sale of receiver’s certificates.

The failure to bring in the necessary parties in order to render binding any judgment that might be obtained in the Sackett suit, is sufficient of itself to stamp the entire proceeding as colorable and fraudulent There was in fact no real contest, and the rights of bondholdere were ignored.

The absence from the record of the Union Trust Company of New York, of Park, Ducan, Hull, Lincoln and the trustees under the other mortgages than those represented by the Union Trust Company renders the Sackett suit a legal absurdity. Western R. R. Co. v. Nolan, 48 N. Y. 513; Hallett v. Hallett, 2 Paige, 15-22.

We do not deem it necessary to discuss in detail the legal points raised attacking the jurisdiction of the court and the form of the action.

We think this suit is maintainable under established principles of equity jurisprudence.

The rule is well settled that courts will set aside as a nullity a judgment, decree or award obtained by fraud. Hackley v. Draper, 60 N. Y. 88; State of Michigan v. Phænix Bank, 33 id. 8; Dobson v. Pearce, 12 id. 156; Wright v. Miller, 8 id. 9; Whittlesey v. Delaney, 73 id. 571; Tiernan v. Wilson, 6 Johns. Ch. 411; Campbell v. Railroad Co., 1 Woods, 368.

This action was promptly begun within two years after the sale in the Sackett suit, and is to be regarded as a bill for relief against the Sackett judgment and all proceedings in that suit as fraudulent. It is not necessary to consider it as strictly a bill of review nor to discuss the law bearing upon suits of that nature.

The action was properly and seasonably brought.

There is no further question whether the certificate holders-have any just ground to complain of the judgment as entered.

By its provisions a referee was appointed to ascertain who were the owners of the Lebanon Springs bonds and which of the bonds were actually in the Sackett suit. It further provided that the referee to sell should pay the net amount realized, to the Lebanon Springs bondholders, except that as to the proportions coming to the owners of such bonds as were in the Sackett suit, he should pay so much thereof to the holders of the receiver’s certificates,' and the balance, if any, to the holders of such bonds.

The bondholders of the Lebanon Springs Railroad Co. duly represented in the Sackett suit were, of course, bound by the order and judgment authorizing the issue of certificates; the remaining bondholders were in no way affected by the judgment.

It is, therefore, apparent that the certificate holders have been as fully protected by the judgment in the case at bar as was possible. There are no exceptions that should lead to reversal.

The judgment appealed from should be affirmed-, with costs.

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

Judgment affirmed.