author: O’Brien, J.:

text:
    Nathan Metzger, Respondent, v. George W. Carr and Others, Appellants, Impleaded, etc.

      Demurrer to an answer — a defense not demurred to will not be set aside — the sufficiency of the complaint can be raised by such, demurrer — a presumption will not be indulged in to destroy the complaint — effect on the debt of the acceptance of a, note — directors of a corporation cha/rged with its debts under section 8 of chapter 267 of 1875.
    Under a demurrer to several of the defenses set up in an answer, it is error for the court to hold that a defense, not demurred to, was had.
    The question of the sufficiency of a complaint can he raised hy a demurrer to the defendant’s answer, and although the defense 'to the complaint he had, the demurrer thereto will not he sustained if the complaint itself is insufficient.

      Where, upon the face of a complaint, it does not appear that a promissory note was given for a past or an existing indebtedness, no presumption will be indulged in for the purpose of destroying the sufficiency of the pleading, but it is a matter to be pleaded, if the facts warrant it, as a defense; upon the argument of a demurrer every inference will be indulged in to support rather than to overthrow the pleading in the action.
    The complaint in an action brought to enforce the liability of the directors of an athletic club, pursuant to section 8 of chapter 267 of the Laws of 1875, showed that a judgment had been recovered against the club corporation upon promissory notes given by it. The complaint was silent as.to whether the notes upon which such judgment was recovered were given as the original evidence of the indebtedness of the corporation or merely as evidence of a past indebtedness. Held, that to create a liability on the part of the defendants they must have been directors of the corporation at the time of the creation of the indebtedness, and that the fact that they were trustees thereof at the time of the giving of the notes, if they were given for a past indebtedness, was not sufficient to charge them with liability;
    That there was no presumption as to whether the notes were given in payment of a past or an existing indebtedness.
    The acceptance of a note by a creditor of a corporation does not merge or extinguish the original indebtedness of such corporation, but only operates to extend the time of the payment thereof, and where an action is not brought against the corporation within one year after the accruing of the original indebtedness, the directors thereof cannot be held personally liable for the amount of such indebtedness under the provisions of section 8 of chapter 267 of the Laws of 1875.
    . Appeal by tbe defendants, George W. Carr and others, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 19th day of February, 1891, upon the decision of the court rendered at the New York Special Term sustaining the plaintiff’s demurrer to the answer of the defendants, and also from the decision or findings of the Special Term.

      George W. Oarr¡ for the appellants Carr and Hoyt.
    Dittenlioefer, Gerber <& James, for the appellant James.

      Berna/rd Metzger, for the respondent.
   O’Brien, J.:

The action is brought to enforce the liability of the directors or trustees of the Manhattan Athletic Club, pursuant to section 8, chapter 267, Laws of 1875, which provides that “the trustees, directors or managers of any society or corporation organized under the provisions of this act shall be jointly or severally liable for all debts due from said society or corporation contracted while they are trustees, provided said debts are payable one year from the time they shall have been contracted, and provided a suit for the collection of the same shall be brought within one year after the debt shall become due and payable.”

Two causes of action upon promissory notes are set up in the complaint, and, after alleging the incorporation of the club, it is averred that upon the respective dates it made its certain promissory notes and delivered the same to the plaintiff for value, which at maturity were not paid. It is further alleged that, at the time of the execution and delivery of such notes, the defendants and each of them were governors, trustees and managers of the club; that the notes were payable one day from date of their execution, and that less than one year has elapsed since they became due and payable, and that payment has been refused. Then follow allegations about suit being brought thereon and judgment obtained, and that the ■whole of the judgment remains unpaid.

The answer of defendants Carr and Iloyt sets up seven defenses :

1. They deny the allegation of liability either on the notes or judgments.

2. They allege that each of the notes was given for a debt theretofore due and owing by the club to ¡plaintiff for goods and merchandise theretofore sold and delivered by plaintiff to the club, and' that neither at the times the debts were contracted nor the notes given were the defendants dll the trustees, but that at such times there were other trustees, and plead non-joinder.

3. They allege the non-joinder of the club.

é. They allege that when plaintiff took the club notes he elected to look only to the club for their payment, and thereby waived any liability of the trustees for the debt or for the notes.

5. They claim the provision of the act under which the liability is sought to be enforced is unconstitutional.

6. They allege that the judgments against the club are a bar.

7. They claim plaintiff had not, previous to this action, exhausted his remedy against the club although it had assets.

The answer of defendant James alleges no knowledge or information sufficient to form a belief as to any of the allegations of either cause of action, except the allegation that the club was incorporated, denies on information and belief that the debt or claim set forth in either cause of action was contracted while he (James) was a trustee, and alleges that the provision of the act mentioned is unconstitutional.

Plaintiff demurred to all the defenses in Carr and Hoyt’s answer except that contained in paragraph “ first.” He demurred to only that portion of, or defense in, said James’ answer which alleges the unconstitutionality of the law.

The learned judge sustained the demurrer, and went one step further in holding that the first defense in Carr and Hoyt’s answer which was not demurred to was bad. As no question was raised as to its sufficiency we do not think that it should have been disposed of. The reasons assigned by the judge in his opinion are clear and satisfactory and require no elaboration at our hands.

The only serious question presented relates to the sufficiency of the complaint, which question could be raised and was available to the defendants upon the demurrer, it having been repeatedly held that, though the defenses to a complaint be bad, a demurrer thereto will not be sustained if the complaint itself is insufficient.

The complaint itself is silent as to whether the notes sued upon were the original indebtedness or merely evidence of an existing indebtedness; and it thus remains to be determined whether, as the result of such silence, a presumption arises either way as to the notes being given for an indebtedness created at the time they were given, or for an indebtedness created prior to the giving of such notes. If the latter presumption is to be indulged in, then, as there is no allegation that the defendants were trustees when the original debt was contracted, but were merely trustees when the notes were subsequently given for the debt, they would not, under the authority of Parrott v. Colby (6 Hun, 55; affd., 71 N. Y. 597); Hardiman v. Sage (124 id. 25) be liable. ■ The liability of such trustees is predicated upon the creation of the indebtedness. In that case it was held that “ the acceptance of a note did not merge or extinguish the original indebtedness, but only operated to extend the time of payment, and that as the plaintiff had not brought an action against the corporation within one year from the time the original debt became due, the defendant was not liable; that the liability of a. stockholder in such cases cannot be renewed or extended by any renewal or extension of the indebtedness which the creditor may make with the corporation.” (6 Hun, 55, supra.)

Although that action was one to hold the defendant liable as a stockholder of a corporation created under the act of 1848, relating to the formation of corporations for manufacturing, mining, mechanical and chemical purposes, the principles applicable to the’ liability under that act and under the Club Act of 1875 are. similar.

We are referred to the case of Lake v. Tysen (6 N. Y. 463) as authority for the position that where nothing is alleged but the-making and delivery of the note, then the presumption to be; indulged in is that it was given for an existing or .past indebtedness,. It is true that in the course of the opinion this language occurs:. The referee held, among other things, that the giving of the note by the appellant to the respondent was presumptive evidence that all prior claims between. the parties were settled. * * *. The giving of a promissory note is prima facie evidence of an accounting and settlement of all demands between the parties, and that the maker was indebted to the payee upon such settlement to the amount of the note.” This language, however, is to be considered in connection with the question before the court, which was whether,, where two persons have each claims against the other, and one finally gives a note, the giving thereof is presumptive evidence of a, settlement of the accounts. Where such a question is presented it; is undoubted law, as held in that case, that the giving of such note; is pri/ma facie evidence of settlement of demands between the; parties, and that all prior claims between them were settled. It: does not, however, go to the extent of holding, nor is it authority-for the position, that in an action upon a promissory note it is to be; presumed that such note was given for a past or existing; indebtedness.

We think it is unnecessary to indulge in any presumption,, because the complaint must be construed according to the language; used, and, under the rule which requires that every inference will be indulged in to support rather than to overthrow a pleading, we; should hold, as the language used itself would import, that either-the debt accrued at the time of the giving of the notes, or that for value received the club promised, according to the tenor of the note, to pay at its maturity, which would result in no debt being created until the note became due. We think, therefore, that the learned judge was right in holding that where, upon the face of a complaint, it does not appear that a promissory note was given for a past or existing indebtedness, no presumption to that effect will bó indulged in for the purpose of destroying the sufficiency of the pleading, but that it is a matter to be pleaded, if the facts warrant it, as a defense.

We think the defendants are equally in error in contending that their liability is predicated • upon the judgment and not upon the notes or the debts of which such notes are the evidence, and that, therefore, it was sufficient to allege, as was here done, that the defendants were trustees when the notes were given, and an allegation that they were trustees when the judgment was obtained was unnecessary.

Our conclusion, therefore, is that the judge was right in sustaining the demurrer to the various defenses set up in the answer of the defendants, but that there was no reason for his adjudging that the first paragraph of the answer of defendants Carr and Hoyt was demurrable, a demurrer thereto not having been interposed, and that question not being before the court. In this respect the judgment should be modified, but in all other respects affirmed, without costs to either party upon this appeal, and with leave to the defendants to amend their answers upon compliance with the conditions imposed by the interlocutory judgment.

Eollbtt and Parker, JJ., concurred.

Judgment modified as directed in opinion and affirmed as modified, without costs to either party.


source: Caselaw Access Project

author: Barrett, J.:

license: Public Domain

text:
    Sarah T. Knapp, Plaintiff, v. Esther E. Greene, Defendant.

      Liability of. the maker of a note payable on demand after three months’ notice — no condition precedent — Statute of Limitations.

    TJpon the trial of an action brought upon a promissory note, it was shown that on April 3, 1880, John E. McAlpine had borrowed 8600 from Sarah T. Knapp (then Tammie S. Spencer), to secure the payment of which amount the following note was given:
    ■“$600. Hillsdale, April 3, 1880.
    “ On demand, after three months’ notice, for value received, we, or either of us, promise to pay to the order of Tammie S. Spencer, the sum of six hundred dol-. lars, with interest from date.
    “And I, Esther E. Greene, do hereby charge my sole and separate estate with the payment thereof.
    “ ESTHER E. GREENE.
    “ JOHN E. MoALPINE.”
    Nothing further occurred between the parties until September 34, 1891, when the following notice was served upon Esther E. Greene:
    “ Dated September %Uh, 1891.
    “ To Mrs. Esther E. Greene :
    “You will please take notice that three months after the service of this notice upon you you will be required to pay the amount due for principal and interest on the promissory note to my order, and held by me, and made by you and John E. McAlpine.
    “ SARAH T. KNAPP.”
    Thereafter the action was commenced by Sarah T. Knapp against Esther E. Greene.

      jHeld, that the liability of Esther E. Greene upon such note, as distinguished from the right of Sarah T. Knapp to sue thereon, did not depend upon the perform- . anee of a condition precedent;
    That the words “ on-demand ” had a precise legal meaning, and did not limit the obligation to pay presently, but were used to show that the debt was due;
    That the Statute of Limitations runs against a note payable on demand whether with or without interest; and the expression “ on demand ” was not so qualified by the words “after three months’ notice,” which immediately followed the same, as to take the contract out of the general rule with regard to demand notes;
    That an action on the note was barred by the Statute of Limitations.
    Motion by the plaintiff, Sarah T. Knapp, for a new trial on a case containing exceptions, ordered to be heard at the General Term in the first instance, upon the decision of the court dismissing the plaintiff’s complaint directed on tlie 23d of April, 1894, after a trial at the New York Circuit before the court and a jury.
    It appeared on the trial that Tammie S. Spencer was married after the date of the note and thus acquired the name of Sarah T. Knapp.

      George II. Pettitt, for the plaintiff.

      Jacob F. Miller, for the defendant.
   Barrett, J.:

The sole question here is whether the note in suit was barred by the Statute of Limitations. The note is in the following form:

“ $600. Hillsdale, April 2, 1880.
“ On demand, after three months’ notice, for value received, we, or either of us, promise to pay to the order of Tammie S. Spencer the sum of six hundred dollars, with interest from date.
“ And I, Esther E. Greene, do hereby charge my sole and separate estate with the payment thereof,
“ESTHER E. GREENE,
“ JOHN E. MoALPINE.”

This note was given for $600 which John E. McAlpine borrowed from the plaintiff upon the day it bears date. The defendant signed the note to enable him to borrow the money.

Nothing further occurred between the parties until the 24th of September, 1891, when the following notice was served upon the defendant:

“ Dated September 24th, 1891.
“ To Mrs. Esther E. Greene :
“ You will please take notice that three months after the service of this notice upon you you will be required to pay the amount due for principal and interest on the promissory note to my order, and held by me, and made by you and John E. McAlpine.
“SARAH T. KNAPP.”

Hpon this state of facts the learned judge at Circuit held that the Statute of Limitations had run against the note, and the plaintiff’s complaint was accordingly dismissed.

We think this disposition of the case was correct. The defendant’s liability, as distinguished from the plaintiff’s right to sue, did not depend, upon the performance of a condition precedent. The money was borrowed, and the note was given to evidence the fact. The words “ on demand” have a precise legal meaning. They do not limit the obligation to pay presently, but are used to show that the debt is due. (Wenman v. Insurance Co., 13 Wend. 267.) And the statute runs against a note payable on demand, whether with or without interest. (Wheeler v. Warner, 47 N. Y. 519; Mills v. Davis, 113 id. 243.) The only question here is whether the expression “ on demand ” is so qualified by the words “ after three months’ notice,” which immediately follow, as to take the contract out of the general rule with regard to demand notes. This is a close question, but upon the whole we think not. The notice required, as was said in Dickinson v. The Mayor (92 N. Y. 591), “ was a condition of maintaining the action and not an essential part of it, upon which the inception of a right is based and the cause of action founded.” -

Such, we think, was the intention of the parties, to be gathered from the peculiar phraseology of the note and the surrounding circumstances. The notice was for the benefit of the debtor, not for the benefit of the creditor. The debtor could at any time waive the notice and tender the debt and interest. The real object -was to give the debtor a reasonable time to pay the debt before the creditor could charge him with the costs of a suit. In other words, the debt was due, but the creditor agreed to limit his right to sue presently.

Let us see where the opposite construction of the instrument would lead. The plaintiff contends that the note should be construed as though it read “three months after demand,” and'as though the-demand and notice were conditions precedent to the existence of a cause of action. If that be so, then the holder of the note could postpone his right of action indefinitely, while the maker could never stop the running of interest or compel the acceptance of payment. As was said in Palmer v. Palmer (36 Mich. 490): “ If there was any infirmity in the consideration, or any defect in the binding character of the obligation, he might retain it until all testimony was lost and defeat the defense. This is the mischief which the Statutes of Limitations were intended to remedy.”

In this case of Palmer v. Palmer, it was held that if “ a creditor has the means at all times of making his cause of action perfect, it would, be unjust and oppressive to hold that he could postpone indefinitely the time for enforcing his claim by failing to present it.”

“ He is really and in fact able,” said the learned judge who delivered the opinion of the court, at any time to bring an action when he can by his own act fix the time of payment. It is no stretch of language to hold that a cause of action accrues for the purpose of setting the statute in motion as soon as the creditor, by his own act and in spite of the debtor, can make the demand payable.”

Substantially the same view was taken in Morrison’s Admr. v. Mullin (34 Penn. St. 12); Rhines v. Evans (66 id. 194); First National Bank of Garrettsville v. Greene, Admr. (64 Iowa, 445); Lower v. Miller (66 id. 408); Prescott v. Gonser (34 id. 175).

The illustrations furnished by these cases help us to a reasonable construction of the instrument in question. They indicate with great clearness and force the evil consequences which would result from the construction given to it by plaintiff; consequences which the parties could never have foreseen and which would amount to a practical nullification of the statute.

These parties could not, in our judgment, have intended to permit the holder of. the note to postpone its maturity as long as she chose to do so. Nor did they intend thus to evade the statute or in fact to prevent its running in the ordinary way.

The notice was seemingly an afterthought. It was not given, for upwards of eleven years after the borrowing of the money and the deliveiy of the note. If the plaintiff is right in her contention, the notice could just as well have been postponed for fifty years. In fact, indefinitely — the cause of action accruing only at her pleasure.

"We cannot agree with this view of the contract. In-our judgment, the statute had run against the note when the notice was, given. It follows that the exceptions should be overruled and judgment ordered for the defendant, with costs.

Parker/ J., concurred; Yan Brunt, P. J., concurred in the-result.

Exceptions overruled and judgment ordered for defendant, with, costs.


author: Barrett, J. :

text:
    Annette B. Wetmore, Respondent, v. Sarah Taylor Wetmore, Individually and as Trustee, etc., of Samuel Wetmore, Deceased, and Another, Appellants, Impleaded, etc.

      Right of a, wife to reach the income of her divorced husband in a trust estate — not limited to income already accrued.

    Where an action is brought by an ordinary creditor to reach the surplus income of a debtor in a trust fund, the remedy of the creditor is not confined to a surplus which has already accrued and accumulated in the hands of a trustee; provision may he made in the judgment directing the application of any future surplus until the debt is fully paid.
    'The same rule is, a fortiori, applicable in proceedings brought by the wife of the cestui que trust, who has obtained a divorce from her husband, to secure the surplus income of her husband in a trust fund, where he has fled the jurisdiction of the State and has failed to pay to his wife the alimony directed to be paid to her by the judgment of the court.
    .Annette B. Wetmore obtained a judgment of divorce from her husband, William B. Wetmore, who was required thereby to provide suitably for the education and maintenance of their three children and for the support of his wife. He was directed to pay $3,000 per annum to his wife, and §1,000 per annum to each of his three children. Every remedy given Annette B. Wetmore by the •Code of Civil Procedure for the enforcement of these provisions was exhausted, ■and such remedies proved unavailing by reason of William B. Wetmore’s intentional disobedience of such judgment, and by his leaving the State and taking with him all his tangible property for the purpose of nullifying such judgment.
    'William B. Wetmore was entitled to an income under the following clause of his father’s will, viz.:

      ““Fifth. I give and bequeath to my executors, hereinafter named, other than my son, one hundred thousand dollars (in cash or in securities or stocks valued by my executors at that sum) upon trust to keep the same invested and receive the income -thereof, and, after deducting reasonable charges for the management of ■said trust, to apply the net income of the said fund from time to time as it shall accrue to the use of my son, William Boerum Wetmore, so long as he shall live.”
    In an action commenced by Annette B. Wetmore to have the income of such trust estate paid to her, it appeared that, Including the trust fund, William B. Wet- • more was possessed of an annual income of §15,000. The income of the trust fund amounted to $4,500 per annum.

      Held, that the wife and children of the beneficiary of the trust estate should be treated in equity substantially as beneficiaries;
    'That they were not severed from the personality of the cestui que trust, but were embraced within it;
    '.That their use of the trust fund was his use, because of his legal obligation to .support and maintain them;

      That, the right of a wife and children to support out of the income of a trust fund, of which the husband and father was the beneficiary, could not be lost because of the misconduct of the husband -which had broken up the family and driven his wife and children to living apart from him ;
    That a decree directing the payment of the income to, and for the support of, the wife and children was proper, and while in a proper case such income would doubtless be apportioned in accordance with settled principles, under the circumstances an apportionment was not required for any just purpose, as WiHiam B. Wetmore needed none of the income, while his wife and children needed it all and more.
    Appeal by the defendants, Sarah Taylor Wetmore, individually and as trustee, etc., of Samuel Wetmore, deceased, and another, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of New York on the 3d day of May, 1894, upon the decision of the court rendered after a trial at the New York Special Term.

      &' P. Nash, for appellant trustee.

      Gerrarcl Irvine Whitehead, for appellant William B. Wetmore.

      Flamen B. Ocmdler, for the respondent.
   Barrett, J. :

This action is founded upon the judgment of this court awarding the plaintiff a divorce by reason of her husband’s adultery. • In this judgment the husband (the present defendant, William B. Wetmore) was required, to quote the language of the Code, “to provide suitably for the education and maintenance of the children of the marriage and for the support of the ” plaintiff. Every remedy given to the plaintiff by the Code of Civil Procedure for the enforcement of these provisions has been exhausted. (See The Continental Trust Co. v. Wetmore, 67 Hun, 9.) These remedies have proved imavailing, not because of Mr. Wetmore’s inability, but because of his factious refusal to comply with the judgment. His disobedience was intentional and his purpose to nullify the judgment deliberate. To effectuate this purpose he left the State and took with him all his tangible property. In plain words, he fled the jurisdiction, defied our courts and left his wife and children to starve.

It appears, however, that there is within the jurisdiction a trust fund, which was created for his benefit and which he cannot remove. The income derivable from this trust fund is now the sole hope of the plaintiff and of his children -— and it is this income which is sought to be secured by the present action. The trust in question was created by the fifth clause of the will of Mr. Wetmore’s father, which reads as follows:

Fifth. I give and bequeath to my executors, hereinafter named, other than my son, one hundred thousand dollars (in cash or in securities or stocks valued by my executors at that sum) upon trust to keep the same invested and receive the incomd thereof, and, after deducting reasonable charges for the management of said trust, to apply the net income of the said fund from time to time as it shall accrue to the use of my son, William Boerum Wetmore, so long as he shall live.”

Under this clause Mr. Wetmore claims that he is absolutely entitled to the net income of the fund ; that, notwithstanding the divorce and alimony judgment, such net income must be periodically remitted to him in his voluntary exile, and that the plaintiff is remediless with regard thereto. In other words, he claims that because of his flight this court is powerless to enforce its judgment or to act upon the trust which is within its jurisdiction.

We might well say, in answer to this claim, what was said by the Supreme Court of the United States in Barber v. Barber (21 How. [U. S.] 596), answering an equally bold assertion of the absence of legal redress against perpetrated wrong —• by a quotation from the opinion of a distinguished South Carolina judge: “ If that argument were to prevail there would be a failure of justice, which our law abhors, and there would be no means 4 of enforcing a decree of a wife against her husband for alimony * * * and upon this occasion I would adopt the course of a very learned judge — If there is no precedent, I will make one.’ ”

We might further answer this claim by a reference to the case of National Tradesman's Bank v. Wetmore (121 N. Y. 241), and to the remarks of Bradley, J., with regard to equity jurisdiction upon the subjects of fraud and trusts.

We think, however, that the court is not here driven to the extremity suggested in Barber v. Barber (supra), but that the judgment appealed from, which subjected the income of this trust fund to the provisions of the divorce judgment, can be sustained, both upon principle and precedent.

Why, it may be asked, should not the income of this trust fund be thus subjected ? The appellants say, because, under the rule laid down in Romaine v. Chauncey (129 N. Y. 566), alimony is not, strictly speaking, a debt due to the wife from her husband, nor, consequently, is her claim thereto that of an ordinary creditor. From this postulate the appellants reason that as it is only a creditor who, under the statute, can reach surplus income beyond what is necessary for the support of the beneficiary, the plaintiff — not being such creditor — is wholly without equity.

The answer to this position is that the rights of the wife and children do not depend upon mere definitions of the term “ alimony,” and that her and their claim to support is higher and greater than that of an ordinary creditor. The question is not whether these children have become, by operation of law, their father’s creditors; nor whether the divorce judgment has transformed the wife and husband into the technical relation of creditor and debtor; but whether the provision duly made for her support and for the support of the children •— no matter how it may be styled or what it may be likened unto •— shall be enforced.

We have said that the claim of the wife and children to support is higher and greater than that of any ordinary creditor. We mean this in a legal as well as in a moral sense, and for this reason: The beneficiary’s wife and children are included in the personal use to which the income of the trust fund is to be applied. All the cases where surplus income has been applied to the claims of creditors limit the surplus to what may remain after making due provision for the suitable support and maintenance of the cestui que trust and those dependent upon him. The court first determines what is necessary for the support, not of the debtor alone, but of him and his family. (Williams v. Thorn, 70 N. Y. 270; Tolles v. Wood, 99 id. 618; McEvoy v. Appleby, 27 Hun, 44.)

Thus the wife and children are treated in equity substantially as beneficiaries. They are not severed from the personality of the cestui que trust, but are embraced within it. Their use is his use. Why ? Clearly because of his legal obligation to support and maintain them. Thus the legal obligation is interwoven with the trust, becomes part of it and vests in the wife and children, jointly with the beneficiary and as his f amity, the right to support and maintenance out of the trust income. This right surely cannot be lost because of the misconduct of the husband, which has broken up the family and driven the wife and children to living apart from him. ' If Mr. Wetmore had creditors to-day who were seeking the surplus income of this trust fund, would the court give them the entire surplus after providing for his individual support? Would not the court still limit the surplus to what should be left after providing for Mr. Wetmore and his family ? That is, for himself and .those who are still the subjects of his family obligation ? We think this is clearly the logic of the situation.

The legal obligation of the divorce judgment is now substituted for the uncontested legal obligation which existed when the parties were living together. The former is now interwoven- with the trust the same as was the latter. And thus the application of the trust income to the support and maintenance of the wife and children under the provisions of the divorce judgment, fulfills the trust direction.

But, further. What is the judgment appealed from but a substitute for the compulsory process whereby the court would have compelled Mr. Wetmore, if present, to apply this very income — when received by him — as required by the divorce judgment. In England similar decrees were granted by the Court of Chancery, founded upon the action of the Ecclesiastical Court, and such decrees were treated as substitutes, rendered necessary by the husband’s flight, for the writ of ne exeat regno. Thus, in Watkyns v. Watkyns (2 Atk. 97) it was held that, as the husband had left the kingdom, interest out of trust money should be paid to the wife until he thought proper to return and maintain her as he ought. Lord Hardwicks said : “ I can do no more in this case than Lord Chancellor Kino did in the case of Colemore v. Colemore, where he framed his decree by way of analogy to the writ of ne exeat regno, and impounded the fortune of the husband for the wife’s maintenance till he should think proper to return.”

In Head v. Head (3 Atk. 295) the chancellor again refers to Colemore v. Colemore in these words: “ And I remember * . * *■ the husband had, after a sentence for alimony, made over his whole estate to trustees, and then went to the West Indies; and upon a bill brought by the wife against the trustees, he (the chancellor)' directed them to pay her a considerable maintenance out of the trust estate whilst the husband resided abroad.”

The same doctrine was suggested in Miller v. Miller (1 Abb. N. C. 30) and was fully maintained by the General Term of the third department in Thompson v. Thompson (52 Hun, 456). In the lat-' ter case the question was directly involved, and Landon, J., met it in these words: “ The trial court held, and we think, properly, that the trust created by the will of Gilbert G. Thompson for the support of Charles Thompson extends also to the support of his wife and child, and that a judicial provision for their support out of the income is a proper application of a portion of the income, and paramount to the rights of judgment creditors.”

Upon both principle and authority, therefore, we think the application of the trust income to the support of Mr. Wetmore’s wife and children, as provided in the divorce judgment, wTas, under the circumstances, proper.

This view of the case eliminates from the discussion the point that no foundation was laid for the appropriation of surplus income. As the plaintiff was not treated as an ordinary creditor there was no question of surplus properly before the court. There was nothing to be ascertained upon that head. Upon the facts found at Special Term, without exception, the entire income was applicable to the support of the beneficiary and his family, wh%le they lived together. It was equally applicable to their support when, owing to Mr. Wet-more’s misconduct, his wife and children were compelled to live apart from him. As it cannot now be applied to their support, jointly, it must be applied equitably, with due regard to the severance of domestic relations. In a proper case it would doubtless be apportioned in accordance with settled principles. Here, however, an apportionment wras not required for any just purpose, as upon the conceded facts Mr. Wetmore needs none of this income, while the plaintiff and the children need it all, and more. The question of Mr. Wetmore’s means was necessarily gone into in the divorce action, and it was there found that in March, 1892, he was possessed — entirely apart from the trust fund under consideration — of an estate in his own right of the value of $200,000 and upwards, producing him an annual income of about $8,500. In the present action it was found that, as far back as the year 1887, or 1888, Mr. Wetmore was possessed of this estate of $200,000, and that his annual income, including the trust fund, was about $15,000. We must assume that -this condition of things has continued to the present time. If there were any change of circumstances it was certainly incumbent upon Mr. Wetmore to show it. In the absence of any finding of fact with regard to such change we are bound to enforce the alimony judgment as rendered. The court there allowed Mrs. Wetmore $3,000 per annum, and each of the three children $1,000 per annum. The income derivable from the trust fund is but $4,500 per annum. Thus, even with the application of the entire income, there will still be a deficiency of $1,500 per annum which Mr. Wetmore is required to pay —and which he could be compelled to pay but for his flight. Under these circumstances, to have apportioned the trust income and allowed Mr. Wetmore unconditionally a part of it for his individual support, would have been a mockery of justice. He has more than enough for his individual support without it. If, however, it were apportioned conditionally, what would necessarily have been the condition? • Certainly the payjnent to the plaintiff from his other property of a sum equivalent to that apportioned to him. The apportionment would then have been a needless formality. But the court might with propriety make a still more stringent condition, namely, the payment of the entire sum awarded by the divorce judgment. A demand for an apportionment is a demand for equity, and if Mr. Wetmore demanded that equity he should have offered to do the equity of complying with the provisions of the divorce judgment. He cannot, therefore, complain that, while he is in contempt of that judgment, the court has done the plaintiff the partial justice of impounding the arrears and directing the future application of the entire income, from time to time, as it accrues, to the satisfaction in part of his just obligations.

There is nothing in the point that the plaintiff’s remedy is confined to the accrued income which had accumulated at the time this action was brought. Even where the action is brought by an ordinary creditor to reach surplus income, it is well settled that the remedy of the creditor is not confined to a surplus which has accrued and accumulated in the hands of the trustees; provision may be made in the judgment directing the application of any future surplus until the same is fully paid. (Williams v. Thorn, supra.) The same rule is, a fortiori, applicable here. It would be absurd to require a fresh action quarterly. The principle having been once settled, a multiplicity of actions to enforce it will neither be required nor allowed.

The judgment is right and should be affirmed, with costs.

Van Brunt, P. J., and Parker, J., concurred. •

Judgment affirmed, with costs.


author: O’Brien, J. :

text:
    Frederick Feist, Appellant, v. Alfred Schiffer and Others, Respondents.

      Action on a promise may be maintained by a third person for whose benefit it was made — contract of indemnity.

    An action will lie on a promise, made upon a valid consideration, to a third person for the benefit of the plaintiS in such action, although the plaintiff was not privy to the consideration, where the facts show that the promise was for the plaintiff’s benefit and made with that distinct intention.
    An agreement considered in the light of the surrounding circumstances, which lead to the determination that the same was a contract of indemnity and not a contract to pay a judgment which might be recovered against one of the parties thereto.
    Appeal by the plaintiff, Frederick Feist, from a judgment of the Supreme Court dismissing the plaintiffs complaint upon the merits, entered in the office of the clerk of the county of New York on the 24th day of April, 1894, upon a trial before the court and a jury at the New York Circuit.

      Upward IF. 8. Johnston, for the appellant.

      M. Warley Platzdk, for the respondents Schiffer et al.
    TF. W. Brycm, for the respondent David,
   O’Brien, J. :

Tliis action is brought by a judgment creditor of Albert A. David against the obligors under the following agreement:

“ Agreement made this third day of December, eighteen hundred and eighty-seven, by and between David, Schiffer & Company, Denzer, Stern & Company and Bernheim, Bauer & Company, parties of the first part, and Albert A. David, party of the second part, witnesseth:
“ "Whereas, the party of the second part, at the request of the parties of the first part, undertook to effect settlement of the claims of the parties of the first .part against II. S. Simon of Eugene City, Oregon; and, whereas, in order to effect such settlement, the party of the second part deemed it necessary and desirable to purchase of one Samuel Simon a certain judgment held by him against said II. S. Simon and for which he gave his check to said Samuel Simon on the Tradesmen’s National Bank of the city of New York for eighteen hundred and sixty dollars; and, whereas, for good and sufficient reasons and in furtherance of the interests of the parties of the first part and with their approval he ordered said bank to refuse the payment of such check when presented, and, whereas, such refusal may involve him in litigation;
“Now, in consideration of the premises and of the sum of one dollar by each of the parties to the other or others in hand paid, the receipt whereof is hereby acknowledged, these presents witness:
“ 1. That in the event that action is brought against the said party of the second part, by said Samuel Simon, his assigns or legal representatives, said parties of the first part will defend such action at their own cost and expense and will pay any judgment that may be rendered against the party of the second part or his legal representatives in any such action.
“ 2. That the parties of the first part between themselves agree that they will pay the costs, expenses and judgment resulting from any action which may be brought as aforesaid in the same proportion as they were interested in the affairs of H. S. Simon, to wit, David, Schiffer & Co:, in the sum of thirty-eight hundred and fifty-one dollars and fifty cents; Bernheim, Bauer & Oo., in the sum of six hundred and nine dollars and ninety-eight cents; Denzer, Stern & Co., in the sum of one hundred and fifteen dollars.”

The plaintiff through mesne assignments became the owner of the check referred to in the agreement and brought suit against David thereon and obtained a judgment, execution upon which was returned unsatisfied, and such judgment still remains unpaid.

The theory of the action is that the agreement inures to the benefit of the plaintiff, having been made between David and the respective firms therein mentioned in favor of the one who should recover judgment on the check. If this theory finds support in the evidence, then, under the familiar principle laid down in the case of Lawrence v. Fox (20 N. Y. 268), that an action will lie “ on a promise by a defendant, upon a valid consideration, to a third person for the benefit of plaintiff, although the plaintiff was not privy to the consideration,” this action is maintainable. It has been many times said by the Court of Appeals that the principle of that case should not be extended, but should be confined to its original' limits. (Lorillard v. Clyde, 122 N. Y. 498; Durnherr v. Rau, 135 id. 222.) And in Beveridge v. N. Y. El. R. R. Co. (112 N. Y. 26) Judge Gray, writing the opinion, says: "Within the principles of adjudged cases in this court, where the plaintiff seeks to base his right to maintain his action against a third party upon a contract made between that party and another, it must be one made or intended for his benefit. Such a beneficial intent must be clearly found in the agreement. * * * But in all of the cases which I have examined where the action was sustained, the facts showed that the promise clearly was for the third person’s benefit, and made with that distinct intention.”

The question here presented, therefore, narrows down to a construction of the agreement itself, as to whether it was a contract of indemnity for David’s benefit, or a contract to pay the judgment creditor. If the language of the agreement were susceptible of the view that the parties thereto promised David that they would pay the judgment creditor, then there would be much force in the argument that this was within the principle laid down in Lawrence v. Fox and kindred cases. But it is equally clear that if it was a mere contract of indemnity to David, then, not being, a,promise, or agreement with David for the- benefit of a third person, it ymuld not be within the principle of those cases, and the plaintiff, having no contractual relation with the parties to the agreement, and not being himself privy thereto, could not under such circumstances maintain this action.

That this was a contract of indemnity we think is clear, not alone from the language of the agreement itself, but in the light of the circumstances surrounding its execution. The parties thereto undertook to pay any judgment which one Samuel Simon, or his assigns, might recover against David upon the check which David had given to Simon in the interest of the parties, but the payment of which he stopped with their approval and in their interest, agreeing between themselves, in the event of liability thereon, to contribute in certain fixed proportions. They, therefore, occupied towards the holder of the check an attitude of hostility and resistance, and did not undertake to pay plaintiff, or make a promise which was to inure to his benefit, but, on the contrary, entered into an agreement for the purpose of inducing David to resist the payment of the check given to-Simon, and which subsequently passed into the hands of the plaintiff. We think that this consideration alone, in view of the language which we have quoted from the case of Beveridge v. N. Y. El. R. R. Co. (supra), is conclusive against the plaintiff’s right to maintain the action. For, as already said (quoting from the opinion in that case) in all cases where the action was sustained, the facts showed that the promise clearly was for the third person’s benefit, and made with that distinct intention.”

There are other objections urged with much force against the plaintiff’s right to maintain this action, but, as we have reached a conclusion upon the main ground, it is unnecessary to discuss them.

We think, therefore, that the judgment below was right, and should be affirmed, with costs.

Follett and Parker, JJ., concurred.

Judgment affirmed, with costs.


author: Yan Brunt, P. J.:

text:
    In the Matter of the Petition of Maud Eva Slaven De Pierris, Appellant, for a Judicial Settlement of the Accounts of Ellen A. Slaven and Another, as Executors, etc., of Moses A. Slaven, Deceased, Respondents.

      Surrogate’s Court — decision as to an applicant’s interest — refusal to compel an accounting when an action for that purpose ispending_ in the Supreme Court.

    ■When tlie papers used upon an application made to a Surrogate’s Court show that the applicant has no interest in the matter to which the application relates, although the applicant swears that he has an interest therein, the surrogate is not bound to entertain the application.
    Where a person has commenced an action to compel an accounting in the Supreme Court, it is not error for a Surrogate’s Court to refuse to entertain an independent proceeding attempted to be brought in that court by such person for the same purpose.
    Appeal by the petitioner, Maud Eva Slaven De Pierris, from an order of the Surrogate’s Court of New York county, entered in the office of the clerk of the New York County Surrogate’s Court on the 11th day of April, 1894, dismissing the proceedings instituted by her to compel an accounting by the executors of Moses A. Slaven, deceased.

      A. II. Holmes, for the appellant.

      A. II. Joline, for the respondents.
   Yan Brunt, P. J.:

"We see no reason for interfering with the conclusion arrived at by the surrogate. There were two grounds upon which his decision seems to have rested: First, that the appellant was not a party in interest; and secondly, that having commenced an action in the Supreme Court for an accounting she would not be allowed to maintain an independent proceeding in the Surrogate’s Court.

It is urged upon the part of the appellant, that she having sworn that she was a party in interest, the surrogate had no discretion, and 'as the Supreme Court may not entertain the action for the accounting, the surrogate erred in dismissing the proceeding before him. We are not aware that it has yet been established that because a party swears that he has an interest, and the papers upon their face show that he has not, the surrogate is bound to entertain any application by sucli party. The interest of the appellant can only be established, by a successful maintenance of her suit in the Supreme Court, and it seems to be time enough for the consideration of the question of accounting when she has established an interest which, upon the record, apparently does not exist.

Furthermore, the appellant has chosen her forum, and having filed a bill in the Supreme Court for an accounting, there is no reason why she should have an independent proceeding. If' the coui't should refuse to entertain that branch of her action which pertains to the accounting, it will be time enough then, in case the court shall decide that she has an interest, for the appellant to pursue her remedies in the Surrogate’s Court.

The order should be affirmed, with costs.

Parker and Barrett, JJ., concurred.

Order affirmed, with costs.


text:
    R. Baring Gould, as Trustee, etc., of Alfred G. Myers, Deceased, Appellant, v. John A. Rutherfurd and Another, as Trustees, etc., of Alfred G. Myers, Deceased, and Others, Respondents, and Theodore A. Myers, and Others, Appellants.

      Trust estate — undisposed of rents and profits belong to the person entitled to the next eventual estate, not to the surviving beneficiary nor to the next of Mn of the deceased beneficiary.

    When, by the terms of a trust, there is a valid suspension of the power of alienation during the continuance of two lives in being, and after the death of one of the beneficiaries there is no disposition made of one-half of the rents and profits of the trust fund, such rents and profits belong to the persons entitled to the next eventual estate.
    When the income of a trust estate is given by will to two sisters, one-half to each, upon the death of one of the sisters the surviving sister is not entitled to the entire income thereof in the absence of a provision to that effect in the will, nor is the income, which would have been payable to the decedent had she lived, payable to the next of kin of the decedent.
    Appeal by the plaintiff, R.. Baring Gould, as trustee, etc., of Alfred G. Myers, deceased, and by the defendants Theodore A. Myers and others, from a judgment of the Supreme Court in favor of the defendants John A. Rutherfurd and another, as trustees, etc., of Alfred G. Myers, deceased, and others, entered in the office of the clerk of the county of New York on the 6th day of February, 1894, upon the decision of the court rendered after a trial at the New York Special Term, and also from the order or decision entered in said clerk’s office on the 2d day of February, 1894.

      John V. JBov/oier, Jr., for plaintiff, appellant.

      II. B. Squire and G. F. Thompson, for defendants, appellants.

      B. Tatska, for the respondents.
   Yan Brunt, P. J.:

It seems to us that it would be difficult to imagine a case to which the statute in reference to undisposed of rents and profits could be intended to apply if it does not control the case at bar.

It is urged upon the part of the appellants that the income which Matilda Myers, one of the beneficiaries, was entitled to receive as long as she lived devolved upon her sister at her death.

An examination of the terms of the will, however, does not bear out any such construction, and such a result can be arrived at only by making provisions in the will for a contingency which the testator himself does not seem to have anticipated. He gives and bequeaths liis personal property remaining after certain specific dispositions to the plaintiffs, as trustees, in trust, to collect, invest and reinvest the same, and pay the income thereof in equal shares to his sisters, Matilda Myers and Louisa Myers. He further provides that at the death of the last surviving of his sisters one-lialf of the principal of his estate shall go to his friend and partner, John A. Rutherfurd, forever, and that the other or remaining half shall go to William Walton Rutherfurd, forever.

Matilda Myers, one of the beneficiaries under the will, having died, there appears to be no disposition of the income of the share, the income of which she was entitled to receive during her life. It is to be observed that the suspension of the power of alienation in respect to this trust estate extends, as to the whole of it, to the death of the survivor of the two sisters. There is thus a valid sus-, pension of the power of alienation during the continuance, of which there is now no disposition made of one-half of the rents and profits. Hence,-under the statute, such rents and profits belong to the persons entitled to the next eventual estate.

There is no ground for the claim that the surviving sister is entitled to hold the same. There is no such provision in the will. The income is given in equal shares to the two sisters, namelyj one-half of the income to each; and when Matilda died there was no disposition of that which she would have received had she continued living.

Neither is there any ground for the claim that such income is payable to the next of kin of the decedent. The provisions of the statute expressly provide for a different disposition, and one which is probably more in harmony with the wishes of the testator. Indeed, it may safely be assumed that the will in question was made having' in view the provisions of the statute in reference to undisposed of income, rather than that the testator was ignorant of the law, and had an intention in respect to the income to which he gave no expression. The defendants Rutherfurd certainly will be entitled to receive absolutely the whole of the fund from which the income arises, upon the termination of the intermediate estate ; and, as has already been observed, if they do not hold the next eventual estate, it is difficult to see where it is located.

There is no ground for the objection in regard to the disposition made as to costs. There would be no propriety in taxing the successful party with the payment of the whole of the expenses of this litigation. The costs are'charged against the principal of the fund which forms the subject-matter of the trust, and, we think, properly so charged.

It may be observed in passing that some' question is made in regard to the income which accrued during the lifetime of Matilda Myers, and which had not been paid over to her at the time of her death. An examination of the case shows that no disjDOsition was made of this income by the decree except from the time of the death of Matilda Myers, and, therefore, there is no such question involved on this appeal.

The judgment should, therefore, be affirmed, with costs to the respondents, to be paid out of the principal of the fund.

Parker and Barrett, JJ., concurred.

Judgment affirmed, with costs to respondents.


author: Van Brunt, P. J.:

text:
    Solomon Jones, Appellant, v. Joseph Wittner, Respondent.

      Specific performance of a contract to exchange real estate — objections known when the contract was made a/re not available — it is too late after one has refused, to perform, to put the other party in the wrong.

    Upon the trial of an action brought to compel the specific performance of an alleged contract for the exchange of real estate in the city of New York, it was shown that Solomon Jones made a payment to Joseph Wittner on account of a contract to be entered into between them for the exchange of such real estate, and that a receipt was given to Jones, reciting generally the terms of the proposed contract, and stating that the parties were to meet together for the purpose of signing a formal contract, and at that time of making an additional payment, from the face of which receipt it appeared that a more formal contract was to be entered into'.
    At the time fixed for the execution of the formal contract objections were raised upon the part of the persons pretending to represent Jones, but really representing themselves, Jones being merely a “ dummy,” that certain leases were upon the premises, and they refused to execute the contraqt unless additional time was given them and concessions were made in regard to certain mortgages and payments.
    At the time of the giving of the receipt and the making of the payment, the parties interested were told of the existence of the leases upon such premises, and the objection made on account of them was made simply for the purpose of securing a change in the terms of the proposed exchange.

      Held, that Jones, having made a payment with full knowledge of the existence of the leases, could not avail himself of them as an objection to his signing the formal contract, simply because the receipt of the money did not mention such leases;
    That upon the trial it was too late to attempt to put the defendant in the wrong, when the latter had been ready and willing to perform his part of the agreement, and the plaintiff, by the real parties in interest, had refused to carry out his part thereof.
    Appeal by tlie plaintiff, Solomon Jones, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of New York on the 16th clay of February, 1893, upon the decision of the court rendered after a trial at the New York Special Term, as amended by an order entered in said clerk’s office on the 2d day of March, 1893.

      B. JV. Cardozo, for the appellant.

      J. Id. Cohen, for the respondent.
   Van Brunt, P. J.:

This action was brought to compel the specific performance of an alleged contract for the exchange of property in the city of New York. In the disposition of this appeal it is not necessary to state with particularity the facts which were developed by the testimony. It would appear from the evidence that the plaintiff was a mere dummy, if he ever had any substantial existence, and that his name was used for the purpose of concealing from the defendant the real parties with whom he was dealing. After a considerable number of negotiations, in which an unusual number of alleged brokers seem to have intervened, a payment on account of a contract to be entered into was made by the plaintiff to the defendant, and a receipt given reciting generally the terms of the proposed contract, it appearing upon the face of this receipt that a more formal contract was to be entered into. At the time fixed for the execution of the formal contract objections were raised upon the part of the persons pretending to represent the plaintiff, but really representing themselves, that certain leases were upon the premises and that they would not execute the contract unless additional time was given them and concessions made in respect to certain mortgages and payments. The evidence more than justified the finding that at the time of the giving of the receipt in question and the making of the payment, the parties interested were told of the existence of these leases upon the defendant’s premises and that this excuse in respect to the leases was made for the purpose of procuring their wishes in reference to the change of terms, they having come to the conclusion that they had probably paid a little too much for the property in question.

It is urged that the receipt upon the part of the appellant was a complete contract, and that, therefore, the defendant could not show that the existence of these leases was known to the parties interested and had been disclosed to them prior to the making of the receipt upon the ground that it varied the terms of the contract. But it is apparent upon a reading of this instrument that it was not intended to be the contract between the parties; but that it was a mere general statement, and that the parties were to meet together for the purpose of signing a formal contract and at that time making an additional payment. The parties having made the payment on account with full knowledge of the existence of these leases, they could not avail themselves of the objection, when the formal contract came to be signed, that the receipt for the money did not mention these incumbrances. As has already been suggested, this question in regard to the leases was a mere afterthought, they having come to the conclusion that they desired a variation in the terms agreed upon, and it was attempted to be used for that purpose. Under these circumstances certainly the plaintiff cannot come into a court of equity and claim either a completion of this contract or a recovery of the payment which he has made on account. He refused to complete; he failed to comply with the agreement in respect to the execution of the instruments; and it was too late for him upon the trial to attempt to put the defendant in the wrong when the latter had been ready and willing to perform his part of the agreement, and the plaintiff by the real parties in interest had refused to carry out his part.

It is true that there was an attempt made upon the part of the plaintiff to show that there had been an offer to perform on the twentieth of August, the day at which the title was to have been passed. But the evidence upon the part of the defense is that there was no such tender as was alleged on the part of the plaintiff; but that only the money which was to have been paid on the twenty-first of July was tendered, and that there were no papers offered or shown. It is manifest that the whole plan upon the part of the parties operating in the name of the plaintiff was to force the defendant to accept different terms from those which he had agreed upon, and upon his refusal to alter the same they refused to carry out the contract. The defendant was not called upon to hold his property subject to the whims and caprices of these persons.

The judgment should be affirmed, with costs.

Eollett and Parker, JJ., concurred.

Judgment affirméd, with costs.


text:
    Felix St. Anna Govin, Appellant, v. Luciana Govin de Miranda, as Executrix, etc., of Felix Govin y Pinto, Deceased, Respondent.

      Gift inter vivos — delivery is essential — equity will not perfect a defective gift made without consideration.

    To establish a valid gift inter vivos a delivery of tbe subject of the gift to the donee or to some person for him, such as to divest the possession and the title of the donor, must be shown.
    While equity, where a trust is founded upon a valuable consideration, will interfere and effectuate its intent, no such rule prevails for. the interposition of a court of equity, in order to perfect a defective gift or voluntary settlement made without consideration.
    When it is found that a gift attempted to be made by a decedent failed to take effect for want of delivery, or of a sufficient transfer, courts of equity cannot supply such defect and- carry out tlie intent of the donor by declaring a trust which he did not himself declare.
    Appeal by the plaintiff, Felix St. Anna Govin, from a judgment ■of the Supreme Court in favor of tlie defendant, entered in tlie office of the clerk of the county of New York on the.2d day of May, 1894, upon tlie verdict of a jury rendered by direction of the co'urt after a trial at the New York Circuit, and also from an order entered in said clerk’s office on the 19th day of April, 1894, denying the plaintiff’s motion for a new trial.

      A. If ling, for the appellant.

      JE. O. James, for the respondent.
   Van Brunt, P. J.:

We see no reason to change the conclusion at which we arrived when this case was previously before the General Term; and the views expressed in the opinion handed down upon the decision of that appeal are confirmed by a re-examination of the case, and by the attempt upon the part of the appellant to establish a trust where it is apparent that if any right of recovery exists it is upon the ground that there was a gift. It is too well settled to need the citation of authorities that to establish a valid gift a delivery of the subject of the gift to tlie donee or to some person for him, so as to divest the possession and the title of the donor, must be shown. In the case at bar it is apparent that tliis condition has not been fulfilled. But it is urged that the donor became tlie trustee of the donee; and that that was the relation which existed between the parties. There is no evidence whatever to establish this assumption, except the statement at the end of the instrument of gift to the effect that said certificates will be retained in my custody for the present as the trustee for- the said Felix Govin Diaz.” There was no attempt upon the part of the donor to part with the control of the subject-matter of this gift. Upon the contrary, he continued to exercise such control and even parted with some portion of the securities mentioned in the original instrument of transfer as his own, and continued until the time of his death to exercise all the rights of ownership without the recognition of any present right in the alleged donee. While it is true that equity, where a trust is founded upon a valuable consideration, will interfere and effectuate its intent, no such rule prevails for interposition to perfect a defective gift or voluntary settlement made without consideration. “ When, therefore,” as was held in the case of Young v. Young (80 N. Y. 437), “ it is found that the gift which the deceased attempted to make failed to take effect for want of delivery, or a sufficient transfer, and it is sought to supply this defect and carry out the intent of the donor by declaring a trust which he did not himself declare, we are encountered by the rule above referred to.”

Our attention is called to the case of Locke v. F. L. T. Co. (140 N. Y. 135) in support of the proposition that, without delivery, by the mere execution of an instrument by the donor, he may make himself a trustee of the subject-matter of the trust. An examination of the facts of that case does not support any such conclusion, which seems to be radically opposed to the existence of a fundamental fact necessary to a gift inter vimos. In the case above there was no attempt upon the part of the donor to create a trust. What he seems to have intended was to make a gift which was to take effect after his death. Such a disposition can only be of a testamentary character, and cannot be upheld unless it possesses the requisites essential to gifts of this character.

The judgment should be affirmed, with costs.

Parker and Barrett, JJ., concurred.

Judgment affirmed, with costs.


text:
    Louis Steets and Another, Respondents, v. The New York Elevated Railroad Company and Another, Appellants.

      Decision need not reiterate the same facts — all findings must be contained in the decision — increase of value, after the erection of an elevated railroad, not presumed to be caused thm'eby.

    It is not necessary for the Supreme Court at Special Term to reiterate substantially the same facts in different findings.
    Where all the facts found by a trial court are not contained in its decision, as required by the general rules of practice and by the provisions of the Code of Civil Procedure, it is proper to dismiss the appeal to the General Term from the judgment rendered thereon.
    The fact that a lot of land on which buildings were erected increased in value after the erection and operation of an elevated railroad, is no evidence that the property (the lot and buildings thereon) has increased in value because of the construction of such road, as the occupation of the building on the premises may, notwithstanding such increase of value in the lot, have been materially affected by the construction and operation of the railroad.
    Appeal by tlie defendants, Tlie New York Elevated Railroad Company and another, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of New York on tlie 19th day of January, 1891, upon the decision of the court rendered after a trial at the New York Special Term.

      A. T. Stoutenberg, for the appellants.

      G. A. B. Pratt, for the respondents.
   Van Brunt, P. J.:

It is not necessary to discuss the question of fact in this case, because the evidence which was relied upon by the appellants has no applicability to the issue which was involved.

Our attention is called to evidence in regard to the value of the lot in question, without reference to the building, as being evidence that the property had increased in value since the construction of the elevated road, and had not thereby been injured. This may be entirely true in respect to the lot, whereas the premises may have been very materially injured because of the effect of the building of the elevated road upon its method of occupation. We see no reason whatever to interfere with the conclusion to which the learned trial judge has come in reference to the question of amount, either as to fee or as to past damage.

It is urged, however, that the court erred because it refused to find certain requests made upon the part of the appellants. The court refused to find as follows :

“ The existence and operation of the defendants’ railroad in Ninth avenue has rendered the premises in suit far more accessible than they otherwise would be.
This increase of accessibility has been a benefit to the plaintiffs’ property, and has increased the value thereof.
“ The facility for rapid transit furnished by the elevated road is a benefit to the neighborhood, and to the premises in suit, and has increased the value thereof.”

The court found that “ the presence and operation of said railroad and station attract to and create in Ninth avenue a considerable amount of traffic and business therein, and the number of persons passing up and down said avenue, and in front of plaintiffs’ said premises, is largely multiplied by reason of the presence of said railroad and station.” This we think was substantially all that the court should have been called upon to find, as it is not necessary to iterate and reiterate substantially the same facts in different findings.

Furthermore, our attention is called to the statement by the learned Court of Appeals in the case of Bookman v. The N. Y. El. R. R. Co. (137 N. Y. 302), in which the court, in commenting upon the refusal to find that the fact of the proximity of the defendants’ station above mentioned to the premises in. suit is advantageous to the business portion of said premises and produces a special benefit to the same for business uses, say: “We think' these facts could with propriety have been found upon the evidence in this case; but the nature and operation of the elevated railroads are so notorious that the courts may assume to be acquainted with them, and from the numerous cases which have come before them they may take judicial knowledge that they increase the traffic in the wide avenues largély devoted to business purposes, and thus generally promote and increase the business thereof,” thus apparently holding that the refusal to find the above facts was not reversible error. A failure to find those facts of which the court may take judicial notice not only is not error, but the finding thereof would be an act of supererogation, as it is not necessary to inform the court by a finding of fact of thofee things which it is presumed to know.

We might very well have dismissed the appeal in this case because of the failure of the appellants to comply with the .repeated decisions of this court in regard to the manner in which the findings of fact are to be prepared and presented in the record. All the facts found are not contained in the decision of the court, as required by the general rules of the court and manifestly by the provisions of the Code of Civil Procedure.

TÍie judgment should be affirmed, with costs.

Follett, J., concurred; Parker, J., concurred in the result.

Judgment affirmed, with costs.


author: Van Brunt, P. J.: Pollett, J.

text:
    Arthur Garfield Levy, by Moses M. Levy, his Guardian, Appellant, v. Carrie Levy and Others, Respondents.

      Partition brought by a remainderman — when the remainder is vested — proper parties.

    If an action of partition bo brought by a remainderman there can be no sale of the premises sought to be partitioned, and when actual partition of the property in question cannot be had the bill must be dismissed.
    The fact that a vested remainder may be cut off by the death of the remainder-man prior to the termination of the life estate does not affect the vesting of the remainder, as it is not a condition precedent but a condition subsequent, and it is only because of uncertainties arising from conditions precedent that a remainder, which otherwise would be vested, becomes contingent.
    Adolph Levy died in 1885 owning certain real estate and leaving a will whereby he devised the residue of his estate, including such real estate, to his executors in trust to receive the rents, income and profits thereof and to divide the same into five equal parts or shares and to apply such income and profits as follows:
    :l Fourth. To receive the rents, income and profits of one of said shares and apply the same to the use of my son, Samuel Levy, so long as he shall live, and upon his death to divide the principal of such share equally among his children, share and share alike.”

      Sueii will also provided tliat if any of such, grandchildren were under the age of twenty-one years, the trustee should apply such income to the support, education and maintenance of such child until he or she should become of age, and upon the arrival of the infant at the age of twenty-one years the principal of his or her portion of such share was to be paid over to such child. Similar provisions were made in regard to the testator’s other children. In the event of the death of any of the sons without leaving surviving issue, the testator gave, devised and bequeathed the share of such son to and among his other children, share and share alike.

      Held, that the children of the sons of the testator took vested remainders in the estate and were not represented by the trustees thereof, and their rights in the premises which formed the corpus of the trust estate would not be cut off by a foreclosure action to which said trustees were parties, if such children were not themselves parties to such action.
    Appeal by the plaintiff, Arthur G-arhelcl Levy, by Moses M. Levy, his -guardian, from a judgment of the Supreme Court in favor of the defendants, entered in the office of the clerk of 'the county of New York on the Ith day of March, 1894, upon the decision of the court rendered at the New York Special Term sustaining the defendants’ demurrer to the plaintiff’s complaint, and also from such judgment as amended March 14, 1894.

      Ira L. Bamberger, for the appellant.

      T. W. Butts, for the respondents.
   Van Brunt, P. J.:

This action was brought for the partition of certain premises in the city-of New York, and the demurrer to the complaint was upon the ground that it did not state facts sufficient to constitute a cause of action.

The complaint alleges that the plaintiff, with the other defendants (except certain lessees), are tenants in -common of a vested remainder in and to the premises in question, and that he is entitled to a one undivided -ninth of and in the said premises in fee, which allegation, however, seems to be at variance with the title of the plaintiff as disclosed in the complaint. Judgment is prayed that the real estate be partitioned, or if that cannot be done without detriment to the several interests so partitioned, the same be sold.

It is urged by the defendants that, as the plaintiff is not among those enumerated in section 1532 of the Code of Civil Procedure as entitled to maintain this action, the demurrer must be sustained. But by section 1533 it is expressly provided that the holder of a vested remainder may maintain partition under certain circumstances.

It may he suggested that as the premises, according to their description, consist of a single lot of land with buildings thereon, it is difficult to see how it can be actually partitioned, and in the case of an action brought by remaindermen there can be no sale, but where actual partition cannot be had the bill must be dismissed. As, perhaps, the court may not be able to take judicial notice of the fact that upon the face of this bill the same must ultimately be dismissed because of the provisions of section 1533 of the Code, it may be necessary to consider the question as to whether the plaintiff in this action has such an estate as authorizes him in any event to bring an action in partition.

The facts out of which the controversy arises are as follows: Adolph Levy died in 1885, owning the premises in question, subject to a mortgage, and leaving a will whereby he devised the residue of his estate, including said premises, to his executors in trust, to receive the rents, income and profits thereof, and to divide the same into five equal parts or shares, and to apply such income and profits in the manner following, and so far as respects the alleged interest of the plaintiff herein the provisions of the will are as follows:

Fourth. To receive the rents, income and profits of one of said shares and apply the same to the use of my son, Samuel Levy, SO' long as he shall live, and upon his death to divide the principal of such share equally among his children, share and share alike.”

Then follows a provision that if any of these grandchildren are under the age of twenty-one years the trustee shall apply such income to the support, education and maintenance of such child until he or she should become of age ; and upon the arrival of the infant at the age of twenty-one years the principal of his or her portion of such share was to be paid over to such child. Similar provisions were made in regard to the testator’s other children.

The testator also provided in said will that in the event of the death of any of his said sons without leaving issue him surviving he gave and devised the share of his said son to and among his other children, share and share alike.

The mortgage above referred to was foreclosed in 1892, and all the children and grandchildren of said Levy, except this plaintiff and his sister, were made parties to such foreclosure suit; and such proceedings were had that the premises were sold subject to the rights and interests of the plaintiff and of the said Carrie Levy, Ins sister, and subject also to a lease of the premises to the firm of Vogel Brothers. The referee conveyed the said premises subject as aforesaid to the purchasers as joint tenants; and the plaintiff, claiming that he, his sister and the purchasers are tenants in common of a vested remainder in and to the said premises, has brought this action for a partition of the same.

The question which is presented is whether the rights of the plaintiff and his sister in their grandfather’s estate were cut off by the proceedings in foreclosure. It is urged upon the part of the respondents that they were not necessary parties defendant in the foreclosure action because the executors and trustees under their grandfather’s will were made parties, and they were vested with the whole legal estate under the will. And in support of this proposition the cases of U. S. Trust Company v. Roche (116 N. Y. 120) and Townshend v. Frommer (125 id. 446) are cited. If the latter case is to be considered as an authority upon this proposition it would seem that the position of the respondents is well taken. But after an examination and comparison of that case with the decision in the case of Campbell v. Stokes (142 N. Y. 23) I hav.e been unable to reconcile the same. And as the rule laid down in the latter case in respect to the vesting of estates seems to be that which most clearly conforms to the provisions of the Bevised Statutes defining such estates, it should be followed.

And it is evident from the language of the court in the case of Campbell v. Stokes that the authority of Townshend v. Frommer (supra) is questioned, and a distinction between the two cases is attempted to be drawn from the fact that one arose under a trust deed and the other under the will. In the case of Campbell v. Stokes the will directed the executors to divide the testator’s residuary estate into as many shares as the testator had children, and gave for each child surviving him one share to the executors to be held in trust for said child for life; and upon the death of such child the executors were directed to convey, pay over and deliver the share to his or her lawful issue, if any, and if none, then provision was made for the distribution of the estate. And it was held that the issue of any child living at his death took a vested remainder in the share held in trust for the parent, subject to open and let in after-born children, and to be divested by their death before the death of the parent; and that the rights of the grandchildren were not dependent in any way upon the action of the trustees, nor did the vesting of their interest await the exercise by the trustees of their power to convey, transfer, etc., but they took as remaindermen, independent of the power.

This definition of the estate under such provisions in a will or in a deed — because I know of no difference in estates, whether created by deed or by will — is in accordance with section 13, page 723, volume 1 of the Revised Statutes, which is as follows :

“ Future estates are either vested or contingent. They are vested when there is a person in being who would have an immediate right to the possession of the lands upon the ceasing of the intermediate or precedent estate.”

In the case cited it was held that immediately, without any intervention of the trustees, upon the termination of the intermediate estate, the grandchildren would have been entitled to possession, and, therefore, they took a vested remainder. It is true' that that vested remainder might be cut off by death prior to the termination of tlie life estate. But the court says that this did not affect the vesting of the remainder, because it was not a condition precedent, but a condition subsequent; and it is only because of uncertainties arising from conditions precedent that a remainder becomes contingent which otherwise would be vested.

In the case at bar the provisions of the will are a devise of the estate to the executors, and there is some ambiguity as to whether they are to divide the principal of the estate or the rent. It would seem that they had the right to divide the principal as well as the rent, as they are required to receive the rents, income and profits of each of said shares and apply them to the use of the sons of the testator, and upon their death to divide the principal among their children, share and share alike. In the case of Campbell v. Stokes it was held that language of a similar character was a present gift to the children of the son, to be enjoyed by them upon the death of their parent; and in that case as in the case at bar there was no intention that the testator should die intestate as to any portion of his estate, because he provides that in the event of the death of any of his sons without issue his estate shall go elsewhere. •

Without discussing this question further it would seem to be beyond dispute that the children of the sons of the testator took vested remainders, and the trustees did not represent that part of the estate.

The judgment should be reversed and the demurrer overruled, with leave to the defendants to answer upon payment of the costs of this appeal and in the court below.

Parker, J., concurred.

Pollett, J.

(concurring):

Under the fourth clause of the will of Adolph Levy the children of Samuel Levy acquired vested remainders in the premises described in the complaint. The plaintiff, Arthur G. Levy, and the defendant, Carrie Levy, are two of the children of said Samuel Levy. Vested legal interests in lands cannot be affected by judgments unless the persons owning those estates are parties to the judgment. Arthur G. Levy and Carrie Levy, having vested legal estates at the time the judgment in foreclosure was recovered, were necessary parties to that action, and not having been made such the sale under that judgment did not cut off their estates.

In United States Trust Co. v. Roche (116 N. Y. 120) it was held that James C. Poster was not a necessary party to that action for the foreclosure of a mortgage because he had not a vested legal or equitable estate in the land. In that case the legal estate was held by a trustee, and both the trustee and the beneficiary were parties.

In Townshend v. Frommer (125 N. Y. 446) it was held that when a certain mortgage was foreclosed the children of Clarissa Curtis had no vested or legal interest in the land, and, therefore, were not necessary parties to the foreclosure. In that case the legal title was held by a trustee, and both the trustee and the beneficiary were parties.

In Campbell v. Stokes (142 N. Y. 23) it was held that the grandchildren of John Mortimer, Jr., had vested legal estates in the land when it was sold under a judgment in partition, and that they were necessary parties to the action, and, not having been made parties, their titles were not cut off. The opinion in Campbell v. Stokes concluded as follows: Whether the remainders in this case were vested or contingent, the persons in being when the partition action was commenced, presumptively entitled to possession on the death of the life tenant, were necessary parties.” This remark is a mere dictum, for the court had decided that the grandchildren had vested remainders at the time the partition judgment was entered.

In Moore v. Appleby (36 Hun, 368; affd., 108 N. Y. 237) it was held at General Term that the children of Charles Tucker had vested interests in the land when the judgment in partition was entered, and, not being parties thereto, were not. affected by it. In the Court of Appeals it was assumed, without discussion, that these children had vested estates in the land. It is said : “ But to which action certain persons entitled to the property in remainder were not made parties.”

Assuming the jiremises in the four cases cited to be correct, they are harmonious, and were correctly decided in so far as the question of parties is concerned. (Story’s Eq. Pldg. § 144, et seq)

The judgment should be reversed and the demurrer overruled, with leave to the defendants to answer upon the payment of the costs of this appeal and in the court below.

Judgment reversed and demurrer overruled, with leave to defendants to answer upon payment of costs of appeal and in the court below.