author: Daniels, J.:

text:
    THE PEOPLE OF THE STATE OF NEW YORK, Plaintiff, v. JOHN C. WILMERDING, Defendant.

      Auctioneers — Slate tax upon their sales — the tax is notuiolatim of the Federal Constitution — when it applies to foreign goods — premmption—payment with knowledge of the facts.

    Chapter 62 of the Laws of 1846, relative to duties payable to the State by an auctioneer upon goods imported from any place beyond the Cape of Good Hope, and upon all other goods which are the production of any foreign country, is still in force.
    The legislation upon this subject since 1842 reviewed.
    The general rule that the repeal of a later statute, repealing an earlier one, will revive the preceding law, is subject to the exception that- where the statute repealed is re-enacted in such form as to embody a part of the preceding law by declaring in the amendatory statute that the statute amended shall read as follows, the earlier statute will not be restored. This exception is itself subject to the limitation that where, by other provisions of the amendatory statute, it is evident that it was the intention of the legislature that the original statute should be revived, such repeal will have the effect of restoring the original statute.
    The statute of 1846 is not in conflict with subdivision 2 of section 10 of article 1 of the Constitution of the United States, declaring that ‘ ‘ no State shall, without the consent of the congress, lay any imposts or duties on imports, or exports, except what may be absolutely necessary for executing its inspection laws.’’

      This act does not apply to goods while they remain in the condition in which they were imported, but only applies to them after the original packages have been broken up and the goods have become a part of the general mass of property in the State.
    The court will not presume that the legislature intended to enact a law which is in conflict with the Constitution of the United States.
    In the case of imported goods sent by an importer to an auctioner in their original cases, and with the authority or consent of the importer sold by the auctioneer in parcels to different persons, after the cases have been broken open, the auctioneer is subject to the payment of the State tax.
    Payments of auction duties made with full knowledge of the facts and without coercion upon the part of the State authorities, though made under protest, cannot be recovered.
    Submission of a controversy upon an agreed statement of facts under the provisions of article 2 of title 2 of chapter 11 of the Code of Civil Procedure.

      W. A. Poste, for the plaintiff.

      Pa/niel P. Says, for the defendant.
   Daniels, J.:

The controversy, which in this manner has been submitted to the court, relates to the obligation of the defendant, as an auctioneer in the city of New York, to return and pay auction duties to the State of New York, and also to the claim of the defendant to recover back auction duties previously paid by him under protest. This latter part of the case requires but little attention for its disposition, for the moneys were paid as auction duties, so far as those payments have been made, with a full knowledge of the facts and without any coercion on the part of the State authorities. And where a payment is made in that manner, although it may be accompanied with the protest of the party paying, the law does not permit the money to be recovered back. (Flower v. Lance, 59 N. Y., 603: Vanderbeck v. City of Rochester, 122 id., 285.)

Goods and merchandise were sold by the defendant, as auctioneer, which were the products of foreign countries imported into the United States, upon which, at the rate of three-fourths of one per cent, the auction duties claimed amount to the sum of $133.06, besides interest. And this balance is claimed by the plaintiff from the defendant under the authority of the laws of this State relating to auction sales. This law, as it was made a part of the Revised Statutes, is contained in title 1, chapter 17, part 1. These provisions, so far as they defined the auction duties, were superseded or repealed by chapter 62- of the Laws of 1846. The first section of this act defined the duties payable to the State by an auctioneer on all goods, wares, merchandise and effects imported from any place beyond the Cape of Good Hope, and all other goods, wares, merchandise and effects which aie the production of any foreign country, and plainly prescribed and regulated the obligations of auctioneers to the State But, by chapter 547 of the Laws of 1866, these provisions were re-enacted with certain changes not required to be noticed for the disposition of this proceeding. By the peculiar phraseology adopted in the act of 1866, it was provided that section 1 of the act of 1846, which prescribed the duties to be paid, was thereby amended so as to read as follows, and then followed the newly enacted law. And, by chapter 106 of the Laws of 1868, this act of 1866 was, in express terms, repealed. And no provisions were then enacted or made creating or prescribing any obligation on the part of an auctioneer to pay auction duties to the State upon the goods and merchandise mentioned in the act of 1846. And for that reason it has been insisted, on behalf of the defendant, that he has been relieved from the obligation of paying auction duties, under the application of the rule that the repealing of the statute in this manner, embodying a preceding law, does not of itself revive that law. Generally speaking, the rule is otherwise, and the repeal of a later statute repealing an earlier statute will revive the preceding law, and reinstated from that time in the same manner as though it had not been repealed. (Van Denburgh v. President, etc., of Greenbush, 66 N. Y., 1.)

But an exception to this rule is stated to exist where the statute repealed is re-enacted in such form as to embody a part of the preceding law, as the law of 1866 amended the act of 1846, by declaring by the amendment that it should read as follows, etc. (People v. Supervisors, 67 N. Y., 109.) And if no more had been done than to repeal the act of 1866 framed in this manner, the construction might be required to be adopted that no law existed after that, obligating an auctioneer to pay auction duties on the sale of merchandise to the State.

But in this respect, as in others where the intention of the legislature can be ascertained, that intention is to be adopted and followed. And it appears, by the second section of the act of 1868, that it was not the understanding of the legislature that the repeal of the act of 1866 should be attended with the result of abrogating the obligation to pay auction duties upon the sale of goods and merchandise. This section amended section 2 of chapter 399 of the Laws of 1849, authorizing the comptroller to appoint an agent still to carry the law into effect. And by the amendment of 1868 it was provided that the agent employed should have full power to administer an oath to each auctioneer, and to require such information as might be necessary to ascertain the true amount of goods sold at auction by such auctioneer. And a fee for the agent was prescribed for approving the returns to be made of sales. This section clearly discloses the intention of the legislature to be, notwithstanding the repeal of the act of 1866, that the preceding law should still be applied and enforced. And this intention is still further manifested by chapter 287 of the Laws of 1878, which excepts the sale of farm property and other personal property sold upon farms, and property which may be owned by any person residing in any of the towns and villages of this State, and which has not been purchased for the purpose of a sale at auction, upon which duties are required to be paid to the comptroller under the laws of this State, from the semi-annual account now required by law, to be rendered to the comptroller, by auctioneers engaged in the sale óf goods, wares, merchandise and effects, the growth or produce of any foreign country.” And the only law to which this reference could have been intended to be made, as the act of 1866 had been repealed, must have been that of chapter 62 of the Laws of 1846, which by its third section declared that the account required by law from every auctioneer should thereafter be rendered semi-annually on the first Mondays of July and January in each year.

It is also apparent, from this act of 1878, that the legislature understood the laws of the State still to require the payment of auction duties upon the sale of goods, wares, merchandise and effects, the growth or produce of foreign countries, as that was regulated by the act of 1846, and previously had been by the part of the Revised Statutes already mentioned. Chapter 310 of the Laws of 1883 is still further significant upon this subject, for it made an important amendment to section 3 of chapter 547 of the Laws of 1866, which, by chapter 106 of the Laws of 1868, had been expressly repealed. This amendment prohibited any auctioneer from executing the duties of his office until he gave a bond to the people of the State, with two sureties, in the penalty of. $5,000, in cities having a population of more than 50,000 inhabitants, for the faithful performance of the duties of his office, and for the payment of the fees or duties that are or shall be imposed by law, and that shall have accrued on sales made by him, or under his direction, by virtue of his office, assuming plainly, by its provisions and directions, that an auctioneer selling goods, wares and merchandise still remained subject to the payment of auction duties to the State. And this exhibition of the intention of the legislature, although given in this awkward manner, is consistent with no other conclusion than that it was intended in the rejoeal of the act of 1866 that the preceding law of 1846 should be revived and continue to apply to the occupation of auctioneers selling goods, wares and merchandise. The defendant, accordingly, cannot be relieved from the obligation to pay auction duties to the State.

But his liability to make the payment of the duties claimed from him is further resisted under subdivision 2 of section 10, article 1 of the Constitution of the United States, which declares that: “No State shall, without the consent of the congress, lay any imposts or duties on imports or exports, except what may be absolutely necessary for executing its inspection laws.” And as the goods and merchandise upon which the duties are now exacted by the State were the products of foreign countries imported into the United States, this provision of the Constitution is invoked as excluding the defendant’s liability. The law, as it has been expressed in the act of 1846, and as it was previously contained in the Revised Statutes of the State, has not, by its language, provided for the payment of duties upon imported merchandise brought into the United States prior to the time when such merchandise shall become a part of the mass of the property of the State. It does, it is true, mention goods, wares, merchandise and effects imported from any place beyond the Cape of Good Hope, and other goods, wares, merchandise and effects the production of any foreign country. But this language is not to be construed as intended to include tlie imported articles while they may remain in the condition in which they are imported. That would be a violation of this constitutional provision. And it is not to be presumed that the legislature intended by the enactment to bring it in conflict with the Constitution of the United States. The presumption, on the contrary, is that it was intended to enact the law in such language as to permit its enforcement without creating a conflict between its provisions and the Constitution. (Newell v. People, 3 Seld., 9, 109.)

Such is the presumption required to be applied in support of legislative enactments. For, inasmuch as they are made with knowledge on the part of the members of the legislature of the constitutional restraints obligatory upon them, it is to be assumed that the intention is to avoid conflict with the provisions of the Constitution. Upon this subject it was said in United States v. Coombs (12 Peters, 72) that, “ If the section admits of two interpretations, one of which brings it within, and the other presses it beyond the constitutional authority of congress, it will become our duty to adopt the former construction; because a presumption never ought to be indulged that congress meant to exercise or usurp any unconstitutional authority, unless that conclusion is forced upon the court by language altogether unambiguous.” (Id., 76.) And this rule is as applicable to the legislation of the State as it is to the legislation of congress.

In Butler v. Commonwealth of Pennsylvania (10 How. [U. S.], 402) it was added that: “ It has been repeatedly said by this court that to pronounce a law of one of the sovereign States of this Union to be a violation of the Constitution is a solemn function demanding the gravest and most deliberate consideration; and that a law of one of the States should never be so denominated, if it can upon any other principle be correctly explained.” (Id,, 415.) And the frequent repetition and long continuance of the laws of the State prescribing and requiring the payment of auction duties upon the sale of this character of goods, merchandise and effects, is still further weighty evidence in support of the conclusion that the laws have not been so enacted as to be brought in conflict with this provision of the Constitution of the United States. (People ex rel. Williams v. Dayton, 55 N. Y., 367.)

The language oi the statute will be fully satisfied by applying it to the control of such sales of imported merchandise after it has passed beyond the protection of the Constitution and laws of the United States, and become a part of the general mass of State property. For these reasons it cannot be held that the law itself, as it now exists, was an unconstitutional exercise of legislative ¡Dower. Whether it applies to the present controversy is to be determined by the status or condition of the property upon which the duties have been exacted at the time when the sales were made by the defendant.

By the agreed case, the defendant sold goods, merchandise and effects imported into the United States from foreign countries to the amount, in the aggregate, of $17,741.74. And it has been agreed by the case that these sales “ represent goods originally imported and sent by the importer in the original imported packing-cases to John C. Wilmerding for sale, but which goods were not sold by the said John C. Wilmerding, as auctioneer, in the original packing eases, but the said packing cases were opened and the goods were sold as follows, for example, a case of woolens or silks contained a certain number of pieces of woolens or silks, each containing the same number of yards, and each being a separate package, piece, parcel or bundle by itself. The separate package, piece, parcel or bundle was sold at auction to retail dealers or jobbers apart from the other contents of said entire case, said package, piece, parcel or bundle not being opened or separated. The cases containing ribbons and trimmings consisted of a large number of boxes or cartons of trimmings or ribbons; a cartón being a box containing a number of rolls of ribbon. The whole ease was not sold hy auction to one person, but the case was opened and the separate boxes or cartons were sold by the auctioneer to different retail dealers or jobbers, said boxes or cartons not being opened or separated.”

The sales, accordingly,' were not made of the goods in the packages in which they were imported under the Constitution and the laws of congress. Where the articles, as they ai-e imported by the importer, are made the subject of sale, there it is clear that the State would not be entitled to exact a duty for the sale itself, although it may be made by an auctioneer as a State officer. This subject was considered very critically, as well as thoroughly, in Brown v. State of Maryland (12 Wheat., 419). But iu that case the State of Maryland prohibited the sale of the goods as imported, unless the importer first obtained a license permitting the sale to be made. And that applied to the packages themselves as they should be brought into the country by the importer. And it was there said, in the opinion of Chief Justice Marshall in defining an exception to the rule prescribed, that “ It is sufficient for the present to say, generally, that when the importer has so acted upon the thing imported, that it has become incorporated and mixed up with the mass of property in the country, it has, perhaps, lost its distinctive character as an import, and has become subject to the taxing power of the State. But while remaining the property of the importer in his warehouse in the original form, or package in which it was imported, a tax upon it is too plainly a duty on imports to escape the prohibition in the Constitution.” (Id, 441.) It was suggested, in the course of the decision, however, that if the importer employed a licensed auctioneer of the State to make the sales, that he could not object to paying for that service, or for iny other for which he might apply to an officer of the State. But, so far as this intimation extended, it has been practically overruled by the case of Cook v. Pennsylvania (97 U. S., 566). But this latter case is still undecisive of the present controversy, for the reason that the goods for which the auction duties were there exacted were sold in the bulk or original packages in which they had been imported. And there can be no doubt, following the construction in this manner placed upon the Constitution, as well as from its express language, that sales of the imported articles in the packages in which the importations may be made are free from all liability to the State for duties claimed to be imposed upon the privilege of making the sale itself.

But where the packages may be broken up and divided into smaller quantities, and practically sold out at retail, as they were by the auctioneer in this case, there they have been considered to have passed so far beyond this constitutional provision as to entitle the States, in the exercise of their sovereign authority, to levy a duty upon the sales which in that manner shall be made. This was considered in People v. Maring (3 Keyes, 374) where in the course of the opinion, which secured the approval of the court, it was said, that “there can be no doubt of the power, of a State to tax articles which, have been imported for sale, after they have passed into the mass of general property by being sold by the importer, either for consumption or resale, or by being divided by him into smaller quantities by the breaking up of the casks or packages in which they were imported, so as to destroy the character of import which subjected them to duties under the laws of the United States.” (Id., 375.) And! in this case it is not contended that this destruction of the packages and the detailed sales made of the goods were not under the authority of the importer. Neither is it to be presumed that the auctioneer without that authority divided and sold the goods in this manner. For that would have been a wrong upon his part, and the' law does not presume a wrong without evidence against any person. The same qualification of the law was also declared in Waring v. Mayor, etc. (8 Wall., 110), where, in the course of the opinion of the court, it was said, that “ When the importer sells the imported articles, or otherwise mixes them with the general property of the State by breaking up the packages, the state of things changes, as was said by this court in the leading case, as the tax then finds the articles already incorporated with the mass of property by the act of the importer.” (Id. 122.) And this was approved of in Low v. Austin (13 Wall., 29.) There it was said that whilst- retaining their character as imports, a tax upon them, in any shape, is within the constitutional prohibition. The question is not as to the extent of the tax, or its equality with respect to taxes on other property, but as to the power of the State to levy any tax. If at any point of time between the arrival of the goods in port and their breakage from the original cases, or sale by the importer, they become subject to State taxation, the extent and the character of the tax are mere matters of legislative discretion.” (Id., 34.) And so the rule was considered in Coe v. Errol (116 U. S., 517). It was there said that “ the State cannot impose any tax or duty on such goods so long as they remain the property of the importer, an'd .continue in the original form or packages in which they were imported.” (Id., 526-7.) And the still later case of Leisy v. Hardin (135 U. S., 1001 sanctions the same construction.

The facts, as they have been disclosed hy the agreed case, exhibit as complete a destruction of the original packages imported, as would have been the case if the importer himself had been engaged in a wholesale or retail business, and had divided and placed these goods for sale in their appropriate places upon the shelves of his establishment. They had proceeded a step beyond that, where the Constitution has carried its protection against State taxation. And the defendant was, therefore, liable under the provisions of the statute of this State to pay to the State the sum of money demanded by it as the statutory duties upon these sales. The plaintiff is, accordingly, entitled to judgment to that effect, together with interest and the costs allowed by law.

Yan Brunt, P. J., and Barrett, J., concurred.

Judgment for plaintiff, with costs.


source: Caselaw Access Project

author: Barrett, J.: Van Brunt, P. X :

license: Public Domain

text:
    THE PEOPLE OF THE STATE OF NEW YORK, Respondent, v. WILLIAM F. DICKIE, Appellant.

      Forgery — the unauthorized filling out by the cashier of a firm of a blank cheek — evidence of the intent — evidence of a shortage generally in the accounts of the cashier — remandes of the court to the accused, when a witness.

    Upon the trial oí an indictment for forgery it appeared that the defendant was the cashier of a firm; tfiat for several years he had been continuously intrusted with twelve checks, payable to his order, signed by the firm, but left blank as to date and amount. His authority in regard to these checks was that he might use them only to pay the bills or drafts of certain persons and transportation companies, the payments to them from time to time varying in amount. When he used one of these checks it was replaced by the firm by a new one in the same form. He had no authority to use them for current expenses of the firm, or in any manner except as stated.
    He filled out one of the checks by adding the word “ currency,” so that it was payable to “W. F. Dickie, currency or order;” inserted the amount of two hundred and twenty-five dollars; indorsed the check in blank; obtained the money upon it; did not enter the cash in the check-book, and fled almost immediately.

      Held, that the crime of forgery was committed.
    That as the defendant had but a special limited authority to use the checks to pay certain persons and corporations, when he exceeded that authority he was guilty of forgery.
    That the forgery consisted in his inserting the words “two hundred and twenty-five dollars ” in a check which was not thus filled in with the intention of using it for the payment of one of the specified creditors.

      That the insertion of the word “ currency; ” the blank indorsement; the drawing of the money; his failure to enter the transaction and his flight, were evidence of an intent to defraud.
    That it was error to allow one of the firm to testify that there was a shortage in the defendant’s accounts generally of a certain amount, no such issue being presented by the indictment.
    That it was improper for the court to say to the prisoner, who had, upon cross-examination, been asked about a certain book; “You know that you kept that book; you know perfectly well what you kept it for; you know perfectly well what it represents, probably not absolutely and definitely; you could give us such information if you meant to, there is no doubt in my mind. ”
    Appeal by tbe defendant William F. Dickie from a judgment of conviction, rendered in tbe Court of General Sessions of tbe city and county of New York on tbe 18th day of July, 1890, adjudging him to be guilty of the crime of forgery in tbe second degree, upon which conviction be was sentenced to imprisonment in the State prison for the term of nine years and six months.

      H. B. Olosson, for tbe appellant.

      David Welch, for tbe respondent.
   Barrett, J.:

Tbe defendant was convicted of tbe crime of forgery in the second degree. Tbe gist of tbe offense was tbe unauthorized filling in of a blank check intrusted to him by bis employers. Tbe material facts, as testified to by tbe complainant, Oscar M. Crego, were these:

Dickie was the cashier of tbe firm of Bussell, Orego & Son. As such cashier be bad been for two or three years intrusted with twelve checks, signed by tbe firm and payable to bis own order, but undated and blank as to amount. When one or more of these checks was used its place was supplied, so that Dickie always bad twelve such checks on hand for immediate use. These twelve checks were detached from tbe check-book, and- were kept by Dickie in tbe money drawer. Dickie’s authority with regard to the use of these checks was peculiar. He was authorized always to pay the drafts of an agent of the firm at Elgin, Illinois; also those of a party in Chautauqua county. He was also authorized to pay the freight bills of the different transportation companies in this city. For these payments he was authorized to use the checks in question without any special direction from the firm. For all other payments, however, he was limited to a special direction. He was not authorized to use any of these checks for the payment of current expenses, or for the purpose of obtaining cash for current expenses, or for the payment or liquidation of. any claims. When money was required for the payment of employees or other cash items, the custom was, when the money in the drawer was insufficent, for Dickie to draw a special check for the requisite amount, payable to “ W. F. Dickie, currency,” and bring it (still in the check-book and attached to the stub) to Mr. Crego to be signed. The custom also was, when any one of the twelve checks was used to pay drafts or other obligations of the firm, for Dickie to date such check, fill in the precise amount of the draft or other obligation, and then indorse it payable to the order of the creditor of the firm.

Upon the 28th of September, 1889, Dickie took one of these twelve checks, dated it, filled it up for $225, inserted the word ' “currency” after his own name, so that in place of reading “Pay to W. F. Dickie, or order,” it read “Pay to W. F.JDickie, currency, or order,” indorsed it in blank and obtained the money therefor at the bank.

The question is, was this a forgery of the check ? The rule has long been well settled in England that an unauthorized filling up of blanks in checks, notes, acceptances and such like instruments of a commercial character amounts to forgery. In Rex v. Hart (7 Car. & P., 652) the prisoner was given an acceptance, blank as to amount, with authority to fill it in for £200. He filled it in for £500. This was held to be forgery, and upon the point being reserved the conviction ivas sustained by all the English judges. In Regina v. Bateman (1 Cox C. C., 186) it was said that where a check is given with a certain limited authority, the agent is confined strictly within ■the limits of that authority, and that if he fills in the check with a different amount from that authorized, or if, after the authority is at an end, he fills it with any amount whatever, it is clearly forgery. The doctrine of Rex v. Hart was followed in Regina v. Wilson (2 Car. & K., 527). There the prisoner was authorized to fill in the amount due on a bill for £150 and interest, then to get the check cashed and pay the bill. Instead of doing this, he filled in £250 and retained part of the proceeds, claiming that it was due him for ■salary. This was held to be forgery. ■'Where the authority is general, a different rule prevails. Thus, in Regina v. Richardson (2 Foster & Fin., 343), the clerk had authority to draw checks upon his employer’s bank, not only to the order of the creditors of the firm, but to his own order, for such sums as he deemed necessary to pay the cash disbursements of the business. Upon one occasion he drew a check to his own order for £11.10, the proceeds of which he appropriated. He was acquitted of forgery and' put on trial for embezzlement, and the court held that the prisoner could not be convicted of forgery, inasmuch as having a general authority to draw, he did not necessarily exceed his authority when he drew the check; and that the criminal'act, if any, was the subsequent appropriation of it.” In that case, however, the distinction is observed, in the statement of facts, that the clerk was not bound always to draw the checks in favor of a particular creditor, but had authority to draw generally and pay the creditor with cash. In the case at bar the jury were authorized to credit Mr. Crego’s testimony and to'find thereon that Dickie had no authority to draw generally and to pay the creditor with the proceeds of the check so drawn, but that his authority was strictly limited to drawing in favor of each particular creditor or for his particular bill. That is, to pay each creditor only by cheek and to fill in such check only the amount of such creditor’s bill. There was in reality no general authority. It is true the special authority was not limited to one creditor or to one specified amount. But there is no distinction in the principle upon which deviations from specific authority are held to be forgeries. The special authority here extended over several subjects, but each subject stood by itself, and the limitation as to each was clear and well defined. There was no authority, either general or special, which authorized Dickie, for any purpose whatever, to fill in any one of these twelve checks with a single dollar except to pay the draft or bill of some one of the specified persons or corporations; none, certainly, to fill in a single dollar for his own purposes.

In the vei’y able brief which Mr. Closson submits in behalf of the defendant he makes this claim: “ It is not necessary to argue that forgery can only be committed with a pen or some similar instrument, and that, unless the prosecution can point to some writing on this check and say that that particular writing, in some way, added to or altered the legal effect of the check, and that the words or figures, so written, were words or figures Dickie’s pen had no right to put there, Dickie did not forge the check, whatever he did with the proceeds.”

¥e agree with this view of the case, but we think the prosecution had a right to go to the jury upon the proposition that the words, “two hundred and twenty-five dollars,” were words which Dickie’s pen had no right to put in this particular check. There was no draft or bill before before him for that amount at the time he inserted those words. Their insertion was wholly outside of the authority conferred. Even if a draft from the Illinois agent for $200 had been before him, his authority was limited to that specific sum, and if he had inserted $225, with a view to misappropriating the surplus, he would have been guilty of forgery. Is he any the less guilty if he inserts the $225 without any bill being before him and appropriates the whole amount? There was no general authority as to amount any more than there was as to individuals. The amount was limited to the face of each draft or bill presented, neither more nor less. And the general authority to *pay drafts or bills of these particular persons was limited to payment in one particular way, and in that only, namely, by filling in one of the twelve checks the exact amount called for and delivering such check properly indorsed to the creditor. Thus the authority conferred was the same in substance as a special authority to pay each of several persons a varying but liquidated amount, and to so pay it in a manner involving a purely clerical act. To fill in one of these checks, therefore, without regard either to the individuals covered by the authority or the amount of their claims — in other words, to fill in an arbitrary sum having no relation whatever to the authority conferred — was forgery if done “ with intent to defraud; ” and the insertion of the word currency,” the blank indorsement and the drawing of the money at the bank were evidences of such intent to defraud.

The principle of the English cases seems to have been generally followed in this country. (Whart. Cr. Law [8th ed.], §§ 671, 672; People v. Graham, 6 Park. Cr., 135; Wilson v. Commissioners, 70 Ill., 46; State v. Maxwell, 47 Iowa, 454; Biles v. Com., 32 Pa. St., 529 ; State v. Kroeger, 47 Mo., 552 ; State v. Flanders, 38 N. H., 324.) The only eases where a doubt is expressed as to the rule are Putnam v. Sullivan (8 Mass., 45), and Van Duzer v. Howe (21 N. Y., 531). These, however, were civil actions upon paper which was fraudulently used, or in which the blank amount was fraudulently increased beyond the sum authorized. They were properly decided upon the estoppel principle, and the doubts which were expressed upon the point in question proceeded upon the mistaken idea that, if the paper was forged in the sense of the criminal law, it would be illogical, in a civil action, to hold the persons who signed it. But there is nothing incongruous between a definition of forgery, upon which the guilty agent may be punished criminally, and a civil rule that, notwithstanding the forgery, one who signed the paper in blank, intrusted it to such guilty agent and conferred upon the latter the power of defrauding the innocent, shall suffer rather than the victim, We think, therefore, that the appellant’s main proposition is untenable, and i-f the case stood upon that alone, we should feel constrained to affirm the judgmeirt.

But we think there was error prejudicial to the defendant in permitting Mr. Crego, upon his evidence in chief, to testify to the discovery of . shortage in Dickie’s account generally to the amount of about two thousand seven hundred and seventy-five dollars. This was doubtless admitted upon the question of fraudulent intent, but it had no just bearing upon that question. It simply tended to show that Dickie was a faithless cashier, and that for an indefinite period he had been robbing his employers. But under this indictment the fraudulent intent was confined to the particular forgery charged, and that depended not at all upon Dickie’s past misconduct in other matters, but largely upon the purpose with which he obtained the $225 in question. The methods resorted to by Dickie to procure these $225, the insertion of the word “ currency ” in the check; the fact that no entry of it appeared in the check-book or in the cashbook, that it was not used in whole or in part for the business; that it was not accounted for in the cash entries of the day when the money was obtained, and his flight almost immediately after the transaction, were all admissible upon the question of intent. But past larcenies by means of false - entries or fraudulent misappropriation of other moneys intrusted to his keeping were surely not admissible. The proof was not even of offenses of the same nature committed at thé samó time, tending to show a general purpose to misappropriate the employer’s moneys- by similar means. Indeed, this particular check seems to have been the only one which Dickie' used contrary to his instruction. For the following question was put to Mr. Crego and the following answer given :

“ Q. The question of the juror is, taking the check-book and! adding together all the checks and comparing them with the vouchers, including those that have not been returned, how does your bank account stand ? A. There was a difference of this check of $225, and that only.”

Other points are made by the appellant which we need not consider. But as the case will probably be tried again we ought to say that the observation made by the learned judge to the defendant, with regard to a certain book, was one which was likely to affect the minds of the jury. The observation was as follows:

“ You know that you .kept that book; you know perfectly well what you kept it for; you know perfectly well what it represents, probably not absolutely and definitely; you could give such information if you meant to, there is no doubt in my mind.”

This was, in effect, a judicial expression against the candor of the defendant, which in-a balanced case might turn the scale against him. Standing alone, and in view of all the facts in this case, we do not think it would be sufficient to justify the granting of a new trial, but it would certainly have been better had the observation been turned into a question and the defendant asked why, if he kept the book and was necessarily familar with its contents, he could not give the information called for.

Upon the point secondly considered, however, the conviction and judgment should be reversed, and a new trial granted»

Andrews, X, concurred.

Van Brunt, P. X :

It seems to me, from an examination of this record, that the,' defendant was convicted really because of a larceny, although indicted for forgery, and as there must be a new trial, it may not be without profit to consider one point in the case. I think that the defendant’s story that he had authority to fill out the check in question,, and that it is not true that the only authority' to fill out these checks: was to pay the bills of two consignees and those of transportation companies, is very strongly supported by the fact that the cheek for $100 has never appeared, and does not appear to have ever been used, and that the check for $225 in question was really filled, out for the purposes testified to by the defendant. The complainant admits that the necessary disbursements paid by the defendant on that day were greater than the amount of the $100 check, and the only money that he had to pay them with, so far as appears by the evidence, was the proceeds of the $225 check. It is true it is stated that the defendant had access to the money drawer, but there is no evidence that on this day it contained one cent of money. -It is not by any means a clear case, and the story of the complainant is, to say the least, in some of its aspects, somewhat extraordinary. I concur in result.

Conviction and judgment reversed, and new trial granted.


author: Barrett, J. :

text:
    RUTH TORBETT, Respondent, v. PARKE GODWIN, Appellant.

      Corporations — liability of directors for a false report — statute strictly construed— it does not apply to debts contracted before the report is filed —right of assignee and of legal representative of claimant — a former judgment against the corporation for the debt not admissible.

    It is declared, by section 21 of chapter 611 of the Laws of 1875, an act relative to corporations, that “if any certificate, or report made, or public notice given by the officers of any such corporation shall be false in any material representation, all the officers who shall have signed the same shall be jointly and severally liable for all the debts of the corporation contracted while they are officers thereof.”
    In an action brought by an assignee of certain creditors of an opera company, incorporated under said act, to enforce payment of the claims against a director of the company, upon the ground that its annual report was false, it appeared that the report was filed after the claims accrued.

      Held, that the plaintiff could not recover.
    That the statute was highly penal and must be strictly construed.
    That the statute must be taken to mean that as to debts contracted after the report was filed the officers who had signed it should be liable; that the purpose of such reports is that the public may be correctly informed of the financial condition of the company in order that it may judge of the credit to which the company is entitled.

      That the object of the statute would be satisfied by confining liability to cases where credit might possibly have been given to the company upon the faith of the report
    That this view was further confirmed by sections 18 and 19 of said act, in which express language is used in stating when the directors shall be liable for debts contracted before the report is made.

      Semite, that the penalty was recoverable by an assignee of the claim, although not by the legal representative of a deceased claimant.
    That the admission of a former judgment for the same debt obtained by the plaintiff against the corporation was error; that such a judgment was not conclusive, and was not even prima facie evidence of the debt.
    Appeal by the defendant Parke Godwin from a judgment entered in the office of the clerk of the city and county of New York on the 13th day of June, 1891, upon a verdict for the plaintiff for $3,112.25, after a trial at the New York Circuit before the court and a jury ; and also from an order, entered in said clerk’s office on the 10th day of June, 1891, denying a motion for a new trial.

      Nelson Smith and L. O. Waehner, for the appellant.

      W. W. Badger, for the respondent.
   Barrett, J. :

The plaintiff brings this action as the assignee of five employees of a corporation known as The American Opera Company (Limited), to recover from the defendant the claims of these employees against such corporation. It is sought to charge the defendant as a director of the company under section 21 of chapter 611 of the Laws of 1875, pursuant to which act the corporation was organized. The section referred to reads as follows:

“ If any certificate or report made, or public notice gimen, by the officers of any such corporation, shall be false in any material representation, all the officers who shall have signed the same shall be jointly and severally liable for all the debts of the corporation contracted while they are officers thereof.”

The first point presented by the appellant is that this section of the statute does not apply to a liability contracted by the corporation before the report was made. As matter of' fact, the liability matured before the report was filed. The contacts with the plaintiff’s assignors were made on the 1st day of July, 1886. The breach occurred on the 11th of December, 1886, and the report was filed on the 20th of January, 1887.

It is apparent at the outset that the plaintiff’s assignors were not prejudiced or affected in the slightest degree by the filing of this report. Their contracts were not made nor were their services rendered upon the faith of it. It was not, in fact, in existence until after their claims had matured. They have, therefore, no possible claim, legal or equitable, against the. defendant except such as the statute expressly gives them.

Now, this statute is highly penal, and the plaintiff must, therefore, show, as was said by Danforth, J., in Van Dyck v. McQuade (86 N. Y., 56): “ That the words of the statute distinctly enact that, under the circumstances, it (the penalty) has been incurred or that there has been a clear intent to embrace it.” Provisions of this character must be strictly construed, and they cannot be extended by implication. (Potter’s Dwarris, page 245, and cases there cited.) We have said that this section is' “ highly ” penal, and we have used the expression advisedly. (~ít seems to have been taken literally from the manufacturing act of 1848 (chap. 40, § 15), except that the expression knowing it to be false,” which, in the latter act, follows the words “ who shall have signed the same,” are omitted. Thus the penalty which formerly attached to downright fraud is now imposed upon mere negligence or inadvertence. A penalty is defined to be “ the punishment inflicted by a law for its violation.” (Bouvier’s Law Dictionary, vol. 2, page 399.) ¡ Certainly, the canons of construction should not be strained to add one iota to the punishment here inflicted or to extend its sphere^

We think that neither the words nor the spirit of this section 21 cover debts of the corporation contracted before the making of the certificate or report. Looked at grammatically, the language used refers to debts contracted in the future, and not to those contracted in the past. The director is not made liable for all the debts of the corporation, but only for all those contracted while they are officers thereof.” What does that mean but contracted while they remain officers thereof, that is, contracted during the period of their continuance in office f And why should we construe this sentence so as to make it read “ contracted while they were or a/re officers thereof ? ” That would not be construing the statute, but altering it. (See In re Sneezum, L. R., 3 Ch. Div., 472, and Underhill v. Longridge, 29 L. J., M. C. [N. S.], 65, cited in Van Dyck v. McQuade, supra.)

This interpretation is emphasized by the use of the preceding words, “ who shall home signed the same.” That implies a looking backward (after the debt has been contracted) for the subject of liability. The words “shall have” were, in this connection, quite unnecessary, unless the legislature contemplated debts contracted by the corporation after the making of the report.

What they mean, is this: That, as to debts thereafter contracted, the officers who shall home signed the false report, and who are still in office, shall be liable. Otherwise the legislature might as well have said, in plain words, that all officers “ signing the report shall be liable for all debts of the corporation contracted during their entire term of office.” But this the legislature has not said, certainly not in so many distinct words, and there is no clear intent to embrace such a sweeping liability as would be comprehended within the words which we have paraphrased. The literal meaning is reasonably plain, but even if it were doubtful, the plaintiff must fail under the canons of construction with regard to penal statutes already referred to.

We think, however, that a consideration of the entire act, read in the light of its object and purpose, renders our construction still' clearer. This purpose was defined by Judge Raparlo, in Pier v. Hanmore (86 N. Y., 101), as follows: “ The purpose for which the annual reports are required to be published is that the public may be correctly informed of the financial condition and resources of these companies, in order that they may judge of the credit to which they are entitled.”

This doctrine was amplified by Mr. Justice Daniels in Walton v. Godwin (58 Hun, 91), where this language was used : “ The report has evidently been required as information to the public concerning* the financial condition and responsibility of the corporation. This information is intended as a security to persons dealing with the company. And whatever would materially affect their judgment in their dealings, should be regarded as a material representation in the report itself. But if a report proves to be untruthful in representations which would- have no affect whatever upon the judgment or conduct of persons dealing with the corporation, such representations could not be consistently lield to be material. And it must be by this criterion that the question of the liability of the persons signing the report should be determined, for if it contains untruthful statements, and those statements appear to be so entirely unimportant that they would not affect, in the least degree, the credit of the company or the conduct of persons dealing with it, then they cannot legally be held to be material misrepresentations.”

The- construction to be given to the section in question should, if possible, be in harmony with its object and purpose as thus defined. That will be accomplished by confining the liability to cases where credit may possibly have been given to the corporation upon the faith of the report. In other words, to debts contracted after it. is filed. '

This gives force also to the word representation ” as used in the section. That section does not read, false in any material “ statement ” or material “ fact,” but false in any material “ representation.” Representation implies an object addressed. Representation to-whom, then? Plainly, to any,one who contemplates trusting the company thereafter.

And this view is reinforced by the fact that the false representation which creates liability is not limited by the section to a certificate or report, but may be embodied in anjpublic notice given by the officers of the company.

- Shall it be said, then, that for any negligent or inadvertent publication the officers of the company are to be mulcted, not only for the-possible consequences of such publication, but for debts contracted before it was thought of ?

These views are further strengthened by the non-adherence of the-Court of Appeals, in several cases, to the literal wording of penal provisions contained in the act of 1848, and by a fair construction of such provisions in the interest of reason and good sense, and to-prevent oppression and injustice.

Thus, in Garrison v. Howe (11 N. Y., 453), it was held that to-charge the trustees with individual liability for a debt of the corporation, by reason of the failure to file the annual report required by law, such debt must have been payable during a default, and that the signing of the contract (under which the company subsequently became liable) during the period of such default was not enough.

Denio, J., speaking for the court, said that: “ If the statute, were simply a remedial one, it might be said that the plaintiff's case, was loithin its equity ; for the general object of the law, doubtless, was, besides enforcing the duty of making reports for the benefit of all concerned, to enable parties proposing to deal with the corporation to see whether they could safety do so.”

So, in Boughton v. Otis (21 N. Y., 261), it was held that, although the statute said that “ all the trustees ” of the company shall be jointly and severally liable for “ all the debts of the company then existing and for all that shall be contracted before such report shall be made,” yet, that such trustees were not so liable for debts contracted after their retirement from office, and that new trustees coming into office after a default are liable only for such debts as are contracted while they are m office. In this case it was said that a literal interpretation would give to the language a broader significance than the legislature intended, and that “ the equity cmd good sense of the statute ” must prevail.

The latter rule.was again applied in Shaler & Hall Quarry Company v. Bliss (27 N. Y. 299), Selden, J., observing that the “ object of the provision, so far as relates to creditors or jiersons dealing with the corporation, appears to have been to give such notoriety to the pecuniary condition of the company, through the publication of its annual statements, as to deprive it of credit, if it shall be unworthy of it''

There is still another consideration which should be adverted to, for it seems crucial. We find that when the legislature, in the act under consideration, thought proper to include debts contracted in the past, it used unmistakable language. For instance, in section 18, providing a penalty for failure to file a report, the language is, that, “ if any such corporation shall fail so to do, all the directors thereof shall be jointly and severally liable for all the debts of the corporation then existing, and for all that shall be contracted before such report shall be made.”

So in the next section (19), with regard to the declaration of a dividend when the company is insolvent or embarrassed. There it is provided that the directors voting in favor of declaring such dividend shall be jointly and severally liable for all the debts of the corporation “ then existing, and for all that shall he th&reafter contracted while they shall resjoectwel/y continue in officeP

Substitute for tlie latter phraseology that used in the section under consideration, namely, that the directors who shall hme voted for the dividend shall be jointly and severally liable for all the debts of the corporation contracted while they are officers thereof. Could it be successfully contended that the then existing debts (contracted while the same directors were in office), would be covered by this substitute ? And if such contention were made, would not he who made it have to stand, not upon the literal words of the statute, but upon the more reasonable position that existing debts were as much affected by an improper reduction of the company’s assets as debts subsequently contracted, and that for that reason it must have been the intent to embrace such existing debts ?

And is not this latter suggestion a perfect answer to the question, why were the words “ then existing ” and “ thereafter contracted ” used in the one section and not in the other ? Is it not apparent that, in the one case, existing debts would necessarily be affected by the fraudulent act of the directors, and, consequently, they were distinctly specified, while in the other, such existing debts would not be affected by the false report, and, consequently, they were omitted ?

We think it is quite evident, in view of these divergences of phraseology, that the legislature here intended to convey different meanings by the use of different words, and thereby to widen or narrow the sphere of penal action according to the legislative view of what varying circumstances called for.

Looking, then, at the statute as a whole, we perceive a distinct and reasonable policy with regard to these reports. That policy proceeds upon two lines. First, to require a report and to punish the omission to file it. Second, to require accuracy in the report when filed, and to punish material inaccuracy.

To secure compliance with the first requirement a continuous punishment is inflicted. The directors are made liable for all debts contracted until they obey.- Every day that they fail in their duty is a day of continuous liability. It is thus that the law enforces its mandate. When, however, the .main requirement is complied with, tbe liability resting upon non-action ceases and a penalty, adequate to redress an infraction of the second requirement, is prescribed. The latter penalty has relation to the wrong to be then redressed. That wrong consists in the possibility of credit being given to the company on the faith of the report. Past credit is not affected by the misfeasance, nor is the existing creditor concerned therewith. Thus, the intention was, first, to compel the filing of the report, to make the directors liable for all debts in case of failure in this particular and to continue this liability until compliance; then, upon compliance, to create a new liability in favor of all subsequent creditors who might possibly be affected by the falsity of any material representation in the report as filed.

Such is our conclusion upon both the words and the intent of the statute. Any other conclusion would not only be contrary to thes.e words and to this intent, but it would create a double penalty, where the failure to file the report was followed subsequently by inaccurate compliance. For instance, the directors who fail to file a report, as required by law, are made liable for all debts then existing and for all that shall be contracted before the report is filed. Now, according to the plaintiff’s contention, when the retarded report is filed, if it be inaccurate, the same directors are again made liable to a new penalty for the same previous debts covered by the first penalty. This, surely, could never have been intended, while the construction which we have given to the section under consideration harmonizes the system devised by the legislature and leaves each section to work out wdiat it Avas designed to effect.

In view of the conclusion thus arrived at, it is unnecessary to pass upon the numerous other questions presented. We may say, however, that we might not have felt justified in reversing the judgment on the second point presented, namely, the non-assignability of the penalty. It is true that the question does not seem to have been squarely presented to the Court of Appeals by the record in any of the cases. (Bolen v. Crosby, 49 N. Y., 187; Pier v. George, 86 N. Y., 613 ; Stokes v. Stickney, 96 id., 327; Brackett v. Griswold, 103 id., 428.) But the dicta are so numerous and from so many distinguished sources, in favor of the assignee’s right, that we should have hesitated before expressing a contrary opinion. It may be difficult to appreciate the distinction between ownership of the debt by direct assignment and ownership by legal devolution. The effect would seem to be equivalent, whether the debt comes to the owner by transfer from the living or by representing the dead. Yet it is said, that while in the latter casé the owner of the debt cannot maintain an action for the penalty, an assignee can. In our judgment, the debt merely measures the penalty, and that is the true reason why the pen alty does not survive. If the penalty, instead of being measured by the debt, had been a fixed sum recoverable by each creditor, without regax-d to the precise amount of his debt, probably it would hot have heen suggested that even an assignee of the debt could recover such penalty. But we need not pursue this subject fui’tlxer as the judgment must be reversed, not only upoxx the question already discussed, but xxpoxx still another ground.

We think the admission of the judgmexxt recovered by the present plaintiff against the company was ex’roi’. It has been expressly held by the Court of Appeals that in actions of this character proof of the recovery of such a judgment is neither conclusive nor prima facie evidence of the debt. (Miller v. White, 50 N. Y., 137.) This case has since been followed and its doctrine reaffirmed.. (McMahon v. Macy, 51 N. Y., 155; Rorke v. Thomas, 56 id., 565.) These cases were distinguished, but in no respect ovenmled or even questioxxed, in Stephens v. Fox (83 N. Y., 313) and Allen v. Clark (108 id., 269). On the contrax’y, Miller v. White was referred to with approval in both of these later cases. Stephens v. Fox was the case of a stockholder who was ixxdebted to the cox-poration to the anxount unpaid xxpon his stock. The creditor sought to recover that indebtedness ixx satisfaction of his claim against the company. It was held that as the" creditor claimed through the company, and was simply subrogated to its claim agaixxst the stockholder, the judgment was admissible. “ A judgment,” said Rapallo, J., “ against the coi’poration beixxg the highest evidexxce against it, should be as effectual to pass its title to the fund in question (the fund being the company's claim against the stockholder for his unpaid assessment) as a deed or any other form of traxxsfer.”

In Allen v. Clark the judgment was for costs recovered against a manufacturing coxnpany, plaintiff, bjr a defendant in an action brought by it. It was held that this judgment was a debt of the compaxxy which it was under the same obligation to pay as any other debt. The reason upon which the decision in Miller v. White is based “ can have,” said Earl, J., “ no application to a case like this, whore there was no liability on the part of the company to pay the costs antecedently to or i/nd&pendently of the j udgment?''

In the present case, the plaintiff introduced evidence tending to support the claims upon which this judgment was recovered. But the learned judge did not submit this evidence to the jury. On the contrary, lie held that the defendant was concluded by the judgment, and instructed the jury that if the plaintiff was entitled to recover, it should be the amount of the judgment, including interest and costs.

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

Yan Brunt, P. J., and Daniels, J., concurred.

Judgment and order reversed and new trial granted, with costs to the appellant to abide event.


author: Andrews, J.: "Van Brunt, P. J. :

text:
    DAVID WOLFE BRUCE and Others, as Executors of CATHARINE L. WOLFE, and as Donees under her Will of a Power in Trust, and Individually, Respondents, v. PETER LORILLARD and Others, Appellants, Impleaded with Others, Defendants.

      Bxecuiors — compensation of, when acting as donees of a power in trust attached to their office.

    The will of one Catharine L. Wolfe contained many specific bequests and devises, and then devised and bequeathed all the rest of her estate, real and personal, to eighteen cousins, share and share alike. In order to enable her executors to provide for the payment of the pecuniary legacies the will gave them, for that purpose only, a power of sale of any real estate not specifically devised. It further authorized them to make partition of the real estate among the persons entitled to shares, and to that end to appoint three commissioners to appraise, allot and set apart said shares, and upon the completion of the allotment it empowered the executors to convey,
    Commissioners were appointed under this provision of the will, and after an allotment had been made the executors rendered valuable services in regard to the real estate and its conveyance. The real estate was worth nearly one million and a half dollars.

      Upon an application by them for compensation, beyond their fees as executors, for such services:

      Held, that it must be denied;-that the real estate vested at once in the devisees, subject to the power of sale.
    That the power in trust was attached to the executors’ office, and that there was no statutory authority for the allowance of any compensation to executors beyond their legal fees.
    Appeal by the defendants, Peter Lorillard, Jacob Lorillard, Catharine L. Kernochan, Mary L. Barbey, Eva L. Kip, George L. Ronalds and James P. Kernochan and others, executors of Lorillard Spencer, deceased; Ronald Thomas, Addison Thomas, George L. Thomas, Catharine d’Anglemont, Peter L. Ronalds, Alfred P. Conk-ling, Howard Colliding and Laura R. Conlding, from certain parts of a judgment, entered, after a trial by the court at the New York Special Term, in the office of the clerk of the city and county of New York on the 3d day of February, 1891, to wit, from findings of fact in these words:

      Ninth. The power vested in the executors in question was beyond that of the mere appointment of commissioners to make partition and division, and beyond the mere work of executing deeds of partition ;; the value of their services was no less, and their labor and responsibility were far greater in fulfilling the trust by revising, modifying- and correcting the valuations, appraisals and allotments of the commissioners, than in the performance of an ordinary power of sale, orín fulfilling an ordinary trust or selling real estate and dividing the proceeds.

      Tenth. The title to the several shares of real estate did not, under the will, vest absolutely in the parties described in the nineteenth item of the will.
    The commissioners appointed by -the executors under the twenty-first item could not vest any title in the said parties; the will required for the vesting of the several shares in them the action, the decision and the deed of the executors. Without the action of the executors the parties entitled under the nineteenth item could not obtain the absolute enjoyment of the real estate devised. A deed from the executors was essential to complete the title.

      Twelfth. Reasonable compensation for such services as the plaintiffs rendered in dividing the said real estate under the circumstances set forth in the preceding findings of fact, is at the rate of one per cent upon the entire value of the property so allotted for each of said executors.
    Also from a conclusion of law in these words:
    Third. The plaintiffs are further entitled to receive the sum of $14,720 each, being one per cent upon the value of the residuary real estate left by the testatrix, and divided by them among the residuary devisees in pursuance of the power vested in them by the will. Also
    From so. much of the ninth conclusion of law as finds that the plaintiffs are entitled to judgment, embodying any part of the findings of fact and conclusions of law hereinabove appealed from, and authorizing them to retain any compensation whatever for dividing the real estate, or any part thereof; and also from such part of the adjudication of said judgment as adjudges that plaintiffs are entitled to any compensation whatever calculated upon the value of the real estate, and more particularly to these words : “ And it is further ordered that the plaintiffs be, and they hereby are, permitted to .retain from any funds in their hands and belonging to said estate -x * x the further sum of $14,720 for each of the plaintiffs, which is 'one per cent upon the value of the residuary real estate left by the testatrix and divided by the plaintiffs among the residuary devisees in pursuance of the power conferred upon the plaintiffs by said will.”

      J. F. Kernooha/n and Tillotson ds Kent and A. K. Gonlding, for the appellants.

      H. H. Man and J. M. Bowers, for the respondents.
   Andrews, J.:

The plaintiffs are the executors of the will of Catharine L. Wolfe, deceased, and this action was brought to settle their accounts. The case was sent to a referee to take and state the accounts of the plaintiffs as such executors, to take testimony as to any question which might arise on said accounts, and to report the testimony taken and the accounts, with his opinion as to the questions of law and fact involved therein. Such testimony was taken, and the referee having made his report, the action was brought to trial at'the Special Term. The referee allowed the plaintiffs commissions on all moneys actually received and paid out by them, and also allowed each executor one per cent on the value of certain real estate which was appraised at $1,472,000.

The Special Term adopted the views set forth by the referee in his report, and a judgment was entered which, amongst other things, provided for the retention by each of the plaintiffs of the sum of $17,449.95 as commissions on personal property; and the further sum of $14,720, which was one per cent on the value of such real estate; and from so much of the judgment as awarded commissions upon the value of the real estate, this appeal is taken.

¥e are unable to concur in the view taken by the learned referee and the court below, as to the commissions allowed upon the value of the real estate. Originally a person acting in a fiduciary capacity was not entitled to receive any compensation for his services in the administration of the trust. (Manning v. Manning, 1 Johns. Ch., 534.) In 1817 the legislature passed an act allowing the Court of Chancery, on the settlement of the accounts of guardians, executors and administrators, to make a reasonable allowance to them for their services over and above their expenses. (Chap. 251, Laws of 1817.) That court thereupon adopted a-rule allowing guardians, executors and administrators a certain percentage upon all sums of money received and paid out by them. (3 Johns. Oh., 630.) Subsequently the legislature passed a law which contained substantially the same provisions as the rule of court, and which as amended is now in force. (R. S. [8th ed.], vol. 4, pp. 2564, 2565.) The court afterwards construed this statute as applying to committees of lunatics (Matter of Roberts, 3 Johns. Ch., 43) and to assignees and trustees of all kinds. (Meacham v. Sternes, 9 Paige, 393.)

It was also held by the Court of Chancery that where an executor, instead of collecting in the money due upon good and collectible securities, for the benefit of the legatees, transfers such securities to a third person for the use of such legatees, with their assent, he was entitled to the same commissions as if he had actually received and paid over the money.

The legislature subsequently amended the statute so as to allow separate commissions to each executor in certain cases (Laws of 1863, chap. 362); and also conferred upon the Surrogate’s Court the power to take and state the accounts of testamentary trustees (Laws of 1850, chap. 272); and upon the settlement of such accounts to award the same commissions as were awarded in similar cases in the Supreme Court. (Laws of 1866, chap. 115.)

The statutes above mentioned are the only ones which, in this State, authorize the payment of executors and trustees for their services as such; and the question presented is whether the plaintiffs, by virtue of the services which they rendered in regard to the residuary real estate of the testatrix, can be regarded as having received and paid out said sum of $1,472,000. The question of the compensation of executors and trustees has frequently been before the courts, but no case is referred to in the briefs of counsel, nor do we know of any in which the facts involved were precisely similar to those presented in the case at bar.

The will of Miss Wolfe contained many specific devises and bequests, and then all the rest of the estate, both real and personal, was devised and bequeathed to eighteen of her cousins, share and share alike. To enable the executors to provide for the pecuniary legacies and requirements of the will (but for that purpose only) they were given by the twenty-first clause thereof an unqualified power of sale of any real estate which belonged to the testatrix in her own right and was not specifically devised. The said twenty-first clause also contained the following: “ I also authorize and empower them to cause just partition to be made of any real and personal estate herein disposed of to and among the several persons who may be or become entitled to undivided shares of or in the same under the provisions of this my will; and for the purpose of making partition of any such estate they shall have power in each instance to appoint, under their hands and seals, three suitable persons as commissioners to appraise, allot and set apart, as may be just and equitable, the respective shares of such estate to the parties entitled thereto; and upon completion of such allotment, and when the same shall have been approved by my executors, I empower them to carry the same into effect by executing and delivering to the respective parties entitled to such estate all such declarations' of allotment, or such releases, conveyances or transfers as may be suitable for that purpose; and if any piece or parcel of property shall be of such disproportionate value that, in the judgment of such commissioners or of my executors, it cannot properly be allotted to any one share, they may, in their discretion, allot it in undivided parts to two or more shares. And I further provide that, after such commissioners shall have made such valuations and allotments as nearly equal or equitable as the circumstances may admit, they shall have power, in order to produce more entire equality, to award such sums out of any funds hereinbefore provided for that purpose as, in their judgment, may be necessary to be made by any or either of the persons taking any of such shares to any or either of those who may take any other share or shares; and they may also, if necessary, charge any residue of any such payments upon any share or shares of the real estate to be allotted by them as aforesaid.”

Under the provisions of the will above stated, the residuary real estate vested in the devisees named in the twentieth clause, and the executors were made the donees of a power in trust. The executors executed the powers conferred upon them by the twenty-first clause of the will, by appointing three commissioners to make partition of such residuary real estate, and subsequently did execute and deliver to the respective parties such declarations of allotment or transfers as were considered suitable to carry into effect the provisions of the will.

It appears to be conceded upon the papers before us that the executors devoted a good deal of time to this matter; and that if the court had the power to allow them any compensation for their services in relation to the real estate, the amounts that were allowed by the referee and the court are not unreasonable. But the difficulty about the matter is, that, assuming that the claim of the executors to be paid for such services is a meritorious one, we can find no provision in the statutes which authorizes the court to make any allowance at all; nor is there any reported case in which it has been field tbiat, upon a similar state of' facts, executors were entitled to compensation for such services by virtue of the provisions of the statutes above stated; or that the court upon a similar state of facts had the power to authorize them to retain money in their hands as compensation for such services.

In the case of Collier v. Munn (41 N. Y., 143) one of the executors was an attorney-at-law, and, at the request of his co-executors and some of the legatees, had rendered services for the estate. There was no dispute as to the necessity or the value of the services, and it was not contended that the amount claimed was more than a reasonable compensation. Nevertheless, the executors claim for services was disallowed by the surrogate, and the decre.e which disallowed the claim was affirmed by the General Term and the Court of Appeals upon the ground that the percentages allowed by the statute were the limit of the compensation which the executor could receive for all the services rendered by him in relation to the trust-estate.

In the case of Lent v. Howard (89 N. Y., 169), upon which counsel for the executors largely rely, it was held by the Court of Appeals that an executor, who had performed services in relation to real estate devised by the will of which he was an executor, might, and should receive reasonable compensation for such services; but-in that case the services performed were not devolved uj>on the executor by the will.

The executors were given the power to sell the real estate and convert the same into money, but they did not do so. The property consisted partly of real and partly of personal estate. There were two executors, and one took charge of the personal property, and the other of the real estate, which consisted of five farms. The executor who had charge of the farms was a farmer, and he assumed, the control and management of such farms and continued in charge, working the same and receiving the rents and profits for about fifteen years. All this was done with the consent of all the parties in interest and for their benefit; and it certainly would have been a case of very great hardship if the executor in that case could not have received compensation for such services. The Court of Appeals recognized the rule that an executor cannot receive for his-services, as suoh, anything beyond the percentages allowed by the-statute. But they held that, in that particular case, the executor' who had managed the farms ought to receive a reasonable compensation out of the gross rents and profits of the real estate which he-had managed, placing their decision, apparently, upon the ground that such services were no part of his duty as executor, but not stating from what sources the court derived the power to grant such compensation.

The court said: “ The principle is that for the personal services of an executor or trustee in the discharge of executorial duties or those which pertain to his trust, the commissions allowed by law are deemed to be a full equivalent. We are not disposed to impair the force of this salutary rule although in some cases the statutory compensation may be quite inadequate. But we think the rule does not fully or justly apply to the claim of the defendant Bailey to be allowed out of the gross rents and profits of the real estate a suitable compensation for services in the nature of a charge thereon for his labor expended in producing them. It was no part of his executorial duty to spend his time and labor in conducting the business of carrying on the farms. Clearly "there can be no ground for claiming that he owed any duty whatever in respect to the homestead farm, but, as has been said, this farm was managed in the same way as the rest. The executors were not entitled to the possession of the testator’s real estate. The control and management was apparently surrendered to Bailey by the consent of all the parties in interest. In accounting the executors should be charged with the net income and profits, and we think that a reasonable compensation to Bailey for his services and labor is a proper element to be considered in ascertaining them.”

Evidently the Court of Appeals thought that case could be distinguished from the case of Collier v. Munn (supra), for it is stated in the opinion that an executor will not be allowed compensation for his own services as attorney in the affairs of the estate, and said case of Collier v. Munn is cited as an authority for that proposition; and we do not see how the decision in Lent v. Howard, helps the case of the plaintiffs, for in that case the services rendered were not devolved upon the executor by the will itself, nor were they those which the executor was under any obligation whatever to perform. "Whereas, in the case at bar, the services about the real estate, for which compensation is claimed, were expressly devolved upon the executors by the will itself, and as they undertook the execution of the will, they were in duty bound to perform such services, whether they could receive compensation therefor or not.

There are other cases in which it has been held that persons naméd in a will as executors were also entitled to compensation as trustees (Johnson v. Lawrence, 95 N. Y., 154; Laytin v. Davidson, 95 id., 263; Phœnix v. Livingston, 101 id., 451), but none of these cases support the claim of the plaintiffs. They were all cases in which there was a plain separation of the duties devolved by the will upon the plaintiffs therein as executors and those devolved upon them as trustees; and the duties as trustees involved labor and responsibility for years after the duties as executors had been entirely performed, and after the estate had been transferred from the individuals named as executors to themselves as trustees. In the present case the executors were the donees of a power in trust, and it was absolutely necessary that they should execute such power in the performance of their duties as executors; and it is impossible to sustain the provisions of the judgment granting them compensation for services about the real estate upon any theory that they were entitled- to it as trustees, for they had no title to the real estate.

In the case of Phœnix v. Livingston (101 N. Y., 451), the facts were not precisely similar to those in the case at bar, but the reasoning of the court is applicable, and it seems to us must be regarded as fatal to the claim of the plaintiffs. In that case the individuals named as executors were also named as trustees in the will, and the court held that they were entitled to double commissions. Part of the property disposed of by the will was real estate, the fee of which vested in certain grandchildren, by force of the will, at the death of the testator. The will gave the executors the power to sell and to rent such real estate, and they did, in fact, manage such property for a series of years, receiving the rents and profits thereof, which were applied to the maintenance of certain trusts created by the will. On the termination of the trust there was a large amount of land which had not been sold, and it was claimed that the trustees were entitled to commissions upon the value of that land.

The Court of Appeals, however, held that commissions could not be allowed upon the value of such lands, but must be limited to percentages trpon the amounts of money actually received and paid out .by them. Pinoii, J\, speaking for the court, said : “We ought not to wander from the statute and strain its construction to an extent approaching perilously near to legislation. In the present case the' fee of the lands, it is conceded, vested in the grandchildren, by force of the will, at the date of the death of the testator. The estate of the trustees took priority but only for purposes of the trust. (Stevenson v. Leslie, 70 N. Y., 512.) They were authorized to sell and to rent the real estate. Upon all sums of money thus realized and passing through their hands they were entitled to ■ commissions, but the unsold lands at the close of the trust passed to the possession of the remaindermen, not through any title derived from the trustees, but by force of the original devise. The trustees transferred no land, but simply refrained from exercising their power of converting it into money; and so they not only never paid it out, even constructively by any grant or conveyance, but never even received the absolute fee Which all the time was a vested interest in remainder. Their estate was simply commensurate with their trust, bounded as to the duration by the terms of the trust, and as to the unsold lands never equaling in value that of the fee.” The counsel for the plaintiffs seek to distinguish the case at bar from that of Phœnix v. Livingston, because of the fact that the executors in the case at bar did execute declarations of allotment and transfers of the real estate as. required by the will, and he claims that, therefore, it must be considered that, constructively, they did receive and payout an amount of money equal to the value of such 'real estate. This is a plausible argument, but it does not seem to us to be sound. "We do not see how the executors can be regarded as having constructively received and paid out an amount equal to the value of the land when they had no title whatever to the land itself. The fee was vested in the devisees named in the will, and the executors were merely the donees of a ‘ power in trust. But, even if the case of Phœnix v. Livingston is not regarded as entirely conclusive against the claim of the plaintiffs, it certainly must be regarded as exceedingly unfavorable to such claim.

The opinion of the learned referee, to whom the case was sent, indicates that he thought' that the plaintiffs had rendered services about the real estate for which, upon the merits, they ought to bo compensated, but that he was somewhat embarrassed to find authority of law for allowing such compensation is apparent. He refers to the case of Phœnix v. Lavingston (supra), but thinks the case at-bar can be distinguished from that one, because the several shares of real estate did not, under the will, vest absolutely in the parties mentioned in the nineteenth clause thereof, and that something was required, to wit: An active approval and making of the allotments by the executors, and a deed by them. The two cases are undoubtedly distinguishable in the manner suggested by the referee, but that does not materially aid the plaintiffs. The fact that the cases differ somewhat leads to the result that Phœnix v. Livingston is not conclusive against the plaintiffs, but that fact does not weaken the force of the reasoning of the court in that case.

The referee also found a further reason for allowing commissions to the plaintiffs, in the consideration that the adoption of a rule that commissions should not be allowed to executors in such cases would array the interest of executors against their duties and destroy their freedom of action, and that executors would be induced to exercise the power of sale vested in them unnecessarily, and against the interest of eestxoi que trusts, for the purpose of earning their commissions.

If an application were made to the legislature to change the statute so as to allow commissions in cases like the one now before' us, it would be proper to call the attention of that body to these considerations, and it is possible the legislature would deem them of such weight as to require that the statute should be so amended. They are not considerations, however, which will justify the court in adopting a construction of the statute which is not warranted by its terms, or justify it in itself amending the statute without the intervention of the legislature.

The learned referee, however, finally based his decision upon the following ground: I am of opinion plaintiffs are entitled to statutory compensation for their services by reason of the terms of the will, because a necessary division and conveyance of the real estate in kind to the devisees is equivalent to the exercise of a power of sale and a division of the proceeds.” In placing his decision upon this ground the learned referee doubtless had in mind the decision of the Court of Chancery in the case of Cairns v. Chaubert (9 Paige, 160), in which executors were allowed commissions upon personal securities which they had distributed without converting the same into cash. That decision itself involved a very liberal construction of the statute, and, in fact, it might be said, an amendment of the statute. But in that case, however, the title of the securities was vested in the executors. They had the power to sell the securities, and it would have been their duty to sell the same but for the consent of the parties in interest that they should be assigned to a trust company without a sale. In the case at bar the title to the real estate was not vested in the executors, but in the devisees. The executors had. the power to sell to provide money for the pecuniary legacies, and to carry out some other requirements of the will; but their duty as to the bulk of the real estate was not to sell it, but to cause it to be partitioned, and it would have been a violation of their duty if they had sold it.

It may very well be that the services rendered by the plaintiffs about the real estate ought to be declared by statute to be equivalent to the receiving and paying out of money upon the sale of such real estate, but the statute does not declare it to be such equivalent, and for the court to construe the statute in such a manner as to make them equivalent would be not only as the Court of Appeals said in Phœnix v. Livingston, “ perilously near legislation,” but would be actual legislation.

The learned judge before whom the case was tried at Special Term filed a brief memorandum which contains, among other things, the following: “ I am satisfied with the reasoning of the learned referee and deem it unnecessary to add anything to his opinion upon the main question presented to him.” He may have been influenced in his conclusion, as the referee apparently was, by the fact that the plaintiffs had rendered services, and that the only way in which they could be remunerated for the same was by adopting the construction of the statute which was placed upon it by the referee. "We might also be willing to adopt that construction so far as the merits are concerned, if we felt at liberty to do so, but as we think that such construction is inadmissible, so much of the judgment at Special Term as awarded $14,720 to each executor for services in relation to the real estate should be reversed, with costs.

"Van Brunt, P. J. :

The construction which was put upon the assignment act, in which language similar to that used in the Revised Statutes in reference to compensation of executors, in the case of Matter of Assignment of Hulburt et al. (89 N. Y., 259) is in accord with the views expressed in this opinion. I concur.

So much of judgment at Special Term as awarded $14,720 to each executor for services in relation to the real estate reversed, with costs.