author: O’Brien, J. :

text:
    Charles E. Hadden, Individually, etc., and Others, Respondents, v. The Metropolitan Elevated Railway Company and Another, Appellants.

      Damage to real estate by the operation of an elevated railroad — denial of past, and allowance of fee damages — evidence as to the effect on other property and as to the sale thereof, improperly excluded.

    A very clear case should he presented on the part ot an owner of improved property to justify an award of fee damages when an award of past damages is denied.
    The plaintiff in an action to recover damages, past and future, for injuries to real property by the erection and operation of an elevated railway, alleged ownership of the hed of the street, which was denied No evidence was presented tending to prove his ownership, and in the face of a concession that if such right existed it was taken away when the street was widened, the referee before whom the action was tried refused to find, although requested so to do, that the plaintiff had no ownership in the bed of the street

      The r'eferee also refused to find, when requested, that the only property in such street appurtenant to such premises, consisted of the easements of light, air and access in and over the same, and that such easements appurtenant to the plaintiffs land taken for the said railway uses, aside from any damages to such land from such taking, had in themselves only a nominal value.

      Meld, that such refusals to find were erroneous and prejudicial to the defendant, and justified the reversal of a judgment for damages for future injuries to such realty.
    Upon the trial of the action, a witness who had formerly occupied some lofts on the same avenue and within two blocks of the plaintiff’s property, the construction and operation of the railroad being the same in front of each property, was asked questions as to the effect of the operation of the road in front of the premises formerly occupied by him, among others, as to whether the road caused any material or substantial interference with the light, air and access appurtenant to the premises, as to whether he observed any injury to his stock of goods resulting from the maintenance of and operation of the road, and as to whether the road interfered with his business, or with the use and occupation of the premises All such questions were excluded, under the plaintiff’s objection.

      Meld, that this evidence should have been admitted, that it was proper for the defendant to show the general effect of the road upon abutting premises.
    The referee also excluded the testimony of the defendant’s expert as to a sale at auction of two pieces of property, one adjoining, and the other a few doors from, the premises in question, at which auction1 the plaintiff was present and was one of the bidders, as to which the witness testified that he heard the price at which the property was struck down.

      Meld, that although such testimony was by rib means conclusive, it was compe ■ tent, as tending to show the course of values, and as strong as experts’ opinions as to the value of particular pieces of property in the neighborhood of or adjoining the premises in suit.
    Appeal bj tbe defendants, The Metropolitan Elevated Railway Company and another, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the city and county of New York on the 2/Tth day of March, 189i3, upon the report of a referee.
    This action was brought to recover of the defendants the damages sustained by the plaintiffs by reason of the existence of an elevated railroad fronting. upon their real property, and to perpetually enjoin and restrain the further erection, operation and maintenance thereof.

      George T. Aldrich, for the appellants.

      Artemus B. Smith, for the respondents.
   O’Brien, J. :

The judgment awards tbe plaintiffs an injunction, unless the defendants shall pay $5,000 fee damage for the conveyance and release of such portion of the easements as is taken by the railroad. The referee finds no past or rental damages.

In Sutro v. Man. Ry. Co. (137 N. Y. 594) it was said: “ A very clear case should be presented, we think, on the part of the owner of improved property, to justify an award of fee damages when an award of past damages is denied. The court ought not, we think,, to assume that the present condition is not to continue, or to award fee damages on the speculation that by future changes in the operation of the road or the location of its stations the benefits which it now receives will be withdrawn.”

It is not claimed that the referee erred in refusing to find, upon the evidence, that there were no past or rental damages, it appearing that the plaintiffs or their predecessors in title occupied the entire premises for twenty-five years, with the exception of the three years last named, during which a portion was leased to a dealer in old iron, which portion shows an increase.

Upon this state of the record it remains to determine whether, in the language of the Court of Appeals, “ a very clear case ” is presented, justifying the award made here of $5,000 for the fee damage. It will be unnecessary to examine the voluminous record presented, it being sufficient to call attention to certain rulings made by the referee, to show that he misa]3preliended the rules of law apjili-cable to cases of this character, and thus his decision is intelligible.

The plaintiffs alleged ownership in the bed of the street, which was denied, and notwithstanding that no evidence was presented tending to prove ownership, and in the face of a concession that if such existed it was taken away when the street was widened, the referee refused, though so requested, to find non-ownership in the bed of the street. It is true that irrespective of the plaintiffs’ ownership of the bed of the street, the defendants are liable for the damages inflicted on plaintiffs’ premises by their appropriation of some portion of the easements appurtenant thereto; but as the claim was made that a portion of the property owned by the plaintiffs, in addition to the easements, was taken, it was proper that the referee, upon proof showing that plaintiffs had no ownership in the bed of the street, should confine his consideration to the consequential damages resulting from the taking or impairment of the easements.

What abutting owners are entitled to have assessed has been frequently stated, but in no case more clearly than that of American Bank Note Co. v. N. Y. El. R. R. Co. (129 N. Y. 252), wherein it was held (head note) that the railroads are liable only “ for such consequential damages as result from the invasion of property rights, that is, the taking of their easements in the street. These are, the easement of ah’, which is impaired by smoke and gases, ashes and cinders; the easement of light, impaired by the structure itself and the passage of cars thereon; the easement of access, affected by the drippings of oil and water, and by the frequent columns.” And in Messenger v. Man. Ry. Co. (129 N. Y. 503) it was held that in estimating those damages the evidence must be confined to what the railroad is authorized to take or interfere with, to wit, the easements of light, air and access.

Notwithstanding the law of these cases, the referee refused to find, when requested, that the only property in said street appurtenant to said premises consists of the easements of light, air and access in and over the same,” and that “ the said easements appurtenant to the plaintiffs’ land taken for the said railway uses, aside from any damages to said land from the said taking, have in themselves only a nominal value.” To such refusals the defendants properly excepted.

We must assume, therefore, that in refusing to find that the plaintiffs had no title to the bed of the street, and in refusing to find that the only property therein of the plaintiffs consists of the easements of light, air and access, the referee was inclined to include as damages elements either of ownership in' the bed of the street, or some other element of damage which can only be surmised. And that the referee included and considered items of damage other than those allowable is shown by the twenty-fifth and twenty-ninth findings, made at plaintiffs’ request, to which exceptions were taken. That such findings are erroneous and prejudicial is apparent, not only from the cases already referred to, but also those of Newman v. Met. El. Ry. Co. (118 N. Y. 618); Bohm v. Same (129 id. 576), and Lazarus v. Same (69 Hun, 190).

We think too tliat tlie learned referee erred in excluding certain evidence offered by defendants. Tims, a witness wbo bad formerly occupied some lofts on tbe same avenue and witbin two blocks of plaintiffs, tbe construction and operation of tbe railroad .being tbe same in front of eacb property, was asked a number of questions as to tbe effect of tbe operation of tbe road in front of tbe premises formerly occupied by liim, among others, as to whether tbe road caused any material or substantial interference with tbe light, air and access appurtenant to tbe premises, and as to whether be observed any injury to bis stock of goods resulting from tbe maintenance and operation of tbe road, and also as to whether tbe road interfered with bis business, or with tbe use and occupation of tbe premises. All of which questions were excluded under plaintiffs’ objection, and, we think, erroneously, under tbe decision in tbe Doyle Case (128 N. Y. 488), where, in tbe course of tbe opinion, page 496, tbe court said: “ Sixth avenue is a broad avenue of uniform width, and while tbe premises occupied by tbe witnesses were not, in their situation, exactly like tbe plaintiff’s, they were similarly situated, and tbe questions would have elicited facts proper for tbe guidance and information of tbe court. It was proper for the defendants to show tbe general effects of the road upon abutting premises. Much of tbe damage which tbe plaintiff claimed was caused to her premises, if it was actually caused to tbe extent claimed by her, must have been common along tbe avenue in tbe vicinity of her premises, and proof of tbe effects upon premises not too distant from hers should have been received.”

So, too, tbe referee, under objection, excluded tbe testimony of defendants’ expert as to a sale at auction of a piece of property adjoining the premises in suit, at which tbe plaintiff was present and one of the bidders, wbo testified that be beard tbe price at which tbe property was knocked down. Notwithstanding such testimony be Avas denied tbe right to state what the property sold for. Tbe same ruling was also made with respect to another piece of property a few doors from plaintiff’s premises, which tbe same witness testified be bad seen sold at auction and beard tbe property knocked doAvn at tbe sale.

Although such testimony is by no means conclusive, we think, as tending to show tbe course of values, it is as competent and strong as experts’ opinions as to the value of particular pieces of property in the neighborhood or adjoining the ones in suit. Such testimony called for facts within the personal knowledge of the witness as to two actual sales occurring in the immediate vicinity. We think that if in these actions the course of values could be shown by actual sales, it would furnish a more certain basis than the speculations of experts or their mere expressions of opinion as to the rise and fall of values in particular localities. We think that such evidence, at all events, was competent and should have been admitted and given such weight as the referee thought it entitled to.

There are other exceptions to which we might advert, but we think sufficient has been shown to make it appear that where no past damages have been awarded, and where a substantial sum has been given for the fee damage, the views entertained by the referee, as shown by his rulings upon evidence and his findings, were prejudicial to the defendants, and account, in the absence of other certain basis, for his conclusion.

We think, therefore, that the judgment should be reversed and a new trial ordered before another referee to be appointed by this court, with costs to appellants to abide the event.

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

Judgment reversed and new trial ordered before another referee to be appointed by this court, with costs to the appellants to abide the event.


source: Caselaw Access Project

author: O’Brien, J.:

license: Public Domain

text:
    The Electric Power Company, Respondent, v. The Metropolitan Telephone and Telegeaph Company, Appellant.

      Removal of the wires of an electric power company — justification therefor — conversion thereof — evidence of damage — liability of an employer for the acts of his employees.

    If a corporation is engaged in the business of maintaining lines of electric wires over which it furnishes power to customers for the movement of machinery for which it charges and receives certain rentals or compensation, although such business is carried-on without authority, no excuse is afforded thereby for the destruction of its property, and conceding that a telephone and telegraph •company has the light to remove the wires of another company from certain fixtures, yet toy thereafter carrying such wires away, it makes itself liatole for their conversion.
    If it can toe found that a person is responsible for the cutting and carrying away of the wires of a corporation, it is not proper for the trial court to refuse to accept the only evidence in regard to the value thereof offered or that could toe offered, although unsatisfactory, simply because toy reason of the illegal acts of third persons, more satisfactory proof is impossible of attainment.
    In an action brought to recover damages from an employer for the wrongful acts of his employee, the motive of the servant is immaterial, and even the fact that the employer gave proper instructions and that the act was in violation of such instructions, does not shelter the employer.
    Where it is shown that, toy the directions of a telegraph and telephone company, certain wires belonging to an electric power company have been cut from fixtures on housetops and removed therefrom without notice to the owner thereof, and without offering the electric power company a reasonable opportunity of collecting together and reclaiming such property, and in addition that such wires were removed toy the employees and servants of the telegraph and telephone corporation, it is an act so closely and intimately connected with and related to their employment that it is tout just that the employer should beheld liatole therefor.
    Appeal by the defendant, The Metropolitan Telephone and Telegraph Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the city and county of New York on the 20th day of March, 1893, upon the verdict of a jury rendered after a trial at the New York Circuit, and also from an order made on the 15th day of March, 1893, and entered in said clerk’s office, denying the defendant’s motion for a new trial made upon the minutes.

      Burton N. Harrison, for the appellant.

      JSoger Foster, for the respondent.
   O’Brien, J.:

In his charge to the jury the learned trial judge clearly stated the facts and defined the issues. As therein said: “ On or before April, 1891, it appears from the proofs that the plaintiff corporation was engaged in the maintenance '.of lines of electric wires, over which it furnished power to customers for the movement of machinery, for which the w plaintiff charged and received certain rentals or compensation. The corporation was organized under a general act of the Legislature of the State of New York. * * * That, being in the enjoyment of this business, some time in March and the first part of April, 1891, the defendant corporation, whose business is indicated, perhaps, by its title, the Metropolitan Telegraph and Telephone Company, by its agents and servants, committed what, in legal parlance, may be called a trespass upon the property of the defendant, in that, by its agents and servants, during the last part of the month of March and the first part of the month of April, the defendant cut and carried away certain wires of the plaintiff, thereby appropriating its property in the wires and causing it damage for the recovery of which this action is brought.”

It was alleged in the complaint, and made to appear on the trial, that the plaintiff had wires attached to fixtures belonging to itself, and also upon fixtures belonging to the defendant. With respect to the latter, there was a dispute as to whether permission had ever been granted to plaintiff to so attach its wires. The plaintiff, however, insisting that it had a lease or at least a license, sought to make the defendant responsible for the damage which it claimed was done to its business, in addition to compelling it to pay for the injury resulting from the cutting of the wires and the carrying away and converting of the same by defendant.

As the damages which it was held the plaintiff could recover were limited solely to such as it could show resulted from the conversion of the wire belonging to it, we may eliminate the other questions from our consideration, leaving it to be determined whether the judgment in this case is right which awarded to the plaintiff damages for the taking of such wire cut and removed from housetops, some from fixtures owned by defendant and some from plaintiff’s own fixtures.

Apart from the questions of their having cut and removed the wire and the damages resulting therefrom, the defendant claims that there were certain insurmountable obstacles in the way of any recovery in this case, growing out of the want of authority in the plaintiff to conduct the business which it was carrying on in this city, and for other reasons which will be noticed. It is insisted that, as the defendant had lawful authority to carry on its business, and as the plaintiff had no authority to carry on the business shown to have been done by it with the electrical conductors here in question, therefore, the defendant was justified in cutting and removing such wires, without being liable to plaintiff in damages.

To this, we think, there are two answers.

The plaintiff was in possession of tlie fixtures with its wires, con- . ducting a business from wliicli it received a revenue, and though this were done without authority it would afford no excuse for the destruction of its property by the defendant. And, second, conceding that the defendant had the right to remove plaintiff’s wires from the fixtures, by thereafter carrying those wires away it made itself liable.

We think that similar reasons apply to the argument based upon the failure of the board of electrical control to give permission to do the business in the way in which it was being conducted by plaintiff. And while it may be true that defendant would not be responsible for any injuries resulting to plaintiff from the former’s attempt to comply with the requirements of the notice of the board of electrical control directing the removal of plaintiff’s wires from defendant’s fixtures, this would not entitle the defendant upon removing such wires to carry away and convert the same. These considerations might be pertinent if damages had been allowed for the fact of the cutting, or for the injury resulting therefrom to plaintiff’s business. But where, as here, the recovery was limited to such damages as were shown to have resulted from the appropriation of plaintiff’s property, wTe fail to see how these can be made available as a defense.

Other suggestions, which we regard as equally irrelevant, are made for the purpose of shielding the defendant from liability, but these we do not deem it necessary to discuss, feeling that the validity of this judgment must be determined by a consideration of the merits of the controversy as finally submitted to the jury.

There -was proof tending to show that all the wire which the defendant cut and took away was of the value of $2,296. Of this amount $900 was claimed to have been wire cut from plaintiff’s own fixtures, and to replace which required the expenditure of $100 to linemen and workmen. If we add to this the interest upon the value of the property taken between the date of conversion and the trial, it will be found that these aggregate amounts exceed the sum awarded by the jury, and, therefore, there can be no claim of excessive damages. The real questions, however, are those which were clearly presented to the jury by the trial judge, as to whether any wire belonging to plaintiff was appropriated and carried away by tbe servants of tbe defendant corporation ; and if so, bow much, and wbat was its value. In addition, we have tbe more serious question, whether the defendant is liable for tbe acts of tbe persons who after tbe cutting removed tbe wire.

Upon all these questions, except as to tbe defendant’s responsibility for the acts of those' who carried away tbe wire, tbe proof as presented furnishes tbe answer. Though from our examination we think it is reasonably free from doubt that tbe same persons who cut tbe wire were engaged in removing and did remove most if not all of it, there is not tbe same certainty with respect to the amount of wire so removed, nor entirely satisfactory evidence as to tbe value thereof. From tbe very nature of tbe acts charged, however, it was difficult, after tbe wire was removed, to describe its condition and determine with accuracy tbe exact amount taken, or, in view of tbe extent of its use, its true value when cut and removed. But we do not think, if it can be found that tbe defendant is responsible, that it is necessary for tbe court' to refuse to accept tbe only evidence offered, or that could be offered, though unsatisfactory, and to accord it no weight simply because, by reason of tbe illegal acts of third persons, more satisfactory proof is impossible.

Upon tbe question of damages, or in regard to tbe evidence offered in support thereof, we see no valid reason for disturbing tbe verdict of tbe jury, to whom all tbe circumstances connected with tbe cutting and removal were presented, and who bad all the light that could be furnished them in determining tbe amount.

Tbe one question, however, which we do not regard as entirely clear is as to the liability of tbe defendant for tbe acts of its employees in removing the plaintiff’s wire after it bad been cut. As stated, we think tbe jury were justified in concluding that it was removed by tbe same persons who cut it, and also that such persons were tbe employees of the defendant. Assuming, therefore, that tbe defendant had tbe right, either under tbe directions of tbe board of electrical control or independently thereof, to remove tbe wires from its fixtures, for the reason that they were upon such fixtures without its authority and contrary to law, and were both a public nuisance and a special nuisance to defendant, is the defendant liable for the further acts of its servants in converting the plaintiff’s property ?

It is insisted that such torts were not within the scope of their employment by defendant, and that defendant cannot be lield liable for them. Undoubtedly authorities can be found both in England ■and in this country to uphold this contention, but it is not our purpose to examine them at length, thinking as we do that there has been upon this branch of the law a gradual tendency to increase the liability of the master for the acts of the employee, and of a principal for acts of an agent, done not only within the scope of his employment, but also within the scope of the business with which he is intrusted. And this is well summarized in a note in 24 Abbott’s New Cases, page 183, wherein it is said: A few years ago it was almost universally held in this country that an act of the employee, the motive of which appeared to be his own malice, did not render the employer liable, even though done within the scope of the employment; but all the authorities which sanction that rule are now deemed, in so far, overruled, and in respect to the question of the right of action the motive of the servant is now immaterial, and even the fact that the employer gave proper instruction, and that the act was in direct violation of those instructions, does not shelter the employer. The only question is, where the line is to be drawn between acts so related to the employment that it is just to hold the employer liable, and acts so disconnected from it that the •employee alone should be liable.”

And, upon the question of principal and agent, the extent to which the courts will go in protecting third persons from such agent’s acts is stated in the case of Fifth Avenue Bank v. Forty-second Street & Grand Street Ferry R. R. Co. (137 N. Y. 231).

We think, therefore, that where it has been shown that by the directions of the defendant the wire belonging to the plaintiff was •cut from fixtures on the housetops and removed therefrom, without notice'to plaintiff, and without affording it a reasonable opportunity of collecting together and reclaiming such property, and where, in addition, it was shown that such wire was removed by the employees and servants of the defendant, it was an act so closely and intimately connected with and related to their employment that it is but just that the employer in this instance should be held liable.

We have examined the exceptions to rulings upon the evidence .and upon the requests to charge, but do not think that these require any special mention.

Upon tbe entire case we think the judgment is just and right, and that it should be affirmed, with costs and disbursements.

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

Judgment affirmed, with costs and disbursements.


author: O’-BeieN, J.:

text:
    Edward Schell, Surviving Executor, etc., of George F. Merklee, Respondent, v. Adaline M. Merklee and Others, Appellants, with Bedford Street Methodist Episcopal Church and Others.

      A defined benefieiw'y is essential to a valid trust — what is a gift in trust and not an absolute gift.

    To constitute a valid trust there must he a defined beneficiary, and the absence oí such a beneficiary is, as a general rule, fatal to a testamentary trust.
    The point really to be determined in all cases in which a question is presented as to whether a clause in a will is an absolute gift or a gift in trust, is whether, looking at the context of the will, the testator intended to impose an obligation on his legatee to carry his wishes into effect, or whether, having expressed his wishes, he intended to leave it to the legatee to act upon them or not in his discretion.
    A testator left a will containing the following residuary clause : “If, after all the legacies are paid in full, there should be anything left of my estate, the same to be divided, and paid to the Methodist Episcopal churches in the ninth ward of the city of New York, according to the number of members, to buy coal for the poor of said churches.”
    In the other clauses of the will, where absolute gifts were intended, apt words were used.

      Held, that such residuary 'clause was expressive of an intention on the part of the testator that the churches should not take the gift absolutely, but that the gift was accompanied by a direction as to the manner in which they should apply it, which was sufficient to constitute a trust;
    That as a trust such bequest must fail, because of the lack of an ascertained and definite beneficiary.
    Appeal by the defendants, Adaliue M. Merklee and others, from a judgment of the Supreme Court, entered in the office of the clerk of the city and county of New York on the 24th day of May, 1893, upon a decision of the court rendered after a trial at the New York Special Term, construing item 20 of the will of George E. Merklee, deceased.

      S. St. J. MoOutehen, for tbe appellants Merklee et al.

      Thomas M. Tyng, for tbe appellants Ludwig et al.

      James Otis JToyt, for tbe plaintiff, respondent.

      Fernando Solinger, for tbe respondent African M. E. Zion Church.

      William D. Udell, for the respondent Jane Street M. E. Church.
   O’-BeieN, J.:

In this action it was sought to obtain a judicial construction off the twentieth or residuary clause of the will of George F. Merklee,. deceased, which provides as follows :

Item 20. If, after all tbe legacies are paid in fuff, there should be anything left of my estate, the same to be divided and paid to the Methodist Episcopal churches in the ninth ward of the city of New York, according to the number of members, to buy coal for the poor of said churches.”

The validity of this clause is to be determined by the conclusion to be readied as to whether there was an absolute gift to the churches named, or only a gift in trust “ to buy coal for the poor of said churches.”

If the former, the fact that there was an expression on the part' of the testator that the moneys were to be applied for one of the-purposes of the corporations would not destroy the gift itself, and-could be disregarded. If, on the other hand, the language used created a trust, constituting the church corporations merely the trustees, then it seems reasonably clear that, as a trust, the bequest must fail for the lack of an ascertained and definite beneficiary.

In support of the view that this was an absolute gift, and not a trust, it is urged with much force that, although the gift to the churches was coupled by the testator with the expression to boy coal for the poor of said churches,” this does not destroy the absolute character of the gift, being an expression merely of his desire that the moneys so given should be used for one only out of the many objects of the church corporations. And in support off this construction we are referred to Matter of Teed (59 Hun, 69), which goes far towards maintaining such a contention. In that case-the bequest was given to the New York Baptist Union for ministerial education, for the endowment of the Rochester Theological Seminary.” As said in the opinion in that case:

“ The use of the word endowment’ in the will is extremely loose, if, indeed, it be true, as we suppose, that there is in reality no corporation by that name. The term manifestly has in this connection no meaning whatever, unless it be in the nature of the expression of .a strong desire on the part of the testator that the fund so given to the residuary legatee should be used for one only of the many objects for which the real corporation was created, viz.: the support of this theological school. The expression for the endowment of the Rochester Theological Seminary,’ in this connection, is meaningless, under any definition that may be found, and it may safely be elided without detriment to the meaning of the will.” And upon this reasoning the court held that the bequest was absolute, and that the words following the gift, or attempting to limit its use, were meaningless and could be disregarded.

On the other hand, it is insisted that the language is susceptible only of a cons traction consistent with an attempt to establish a trust of an ascertainable fund in trustees for a definite purpose in favor of beneficiaries, which must fail because the beneficiaries are neither ascertained nor ascertainable.

If the premise is sound that this was an attempt to create a trust, then we think the conclusion follows, because it is clear that there are no defined or definable beneficiaries. The legal test of definiteness in the beneficiary is the capacity to come into court and invoke the performance of the trust. (Levy v. Levy, 33 N. Y. 101.) And as it would be impossible for anyone to establish that he was within the class of persons intended to be benefited, he could not claim the benefit of such a trust.

Ujion the crucial question as to whether this is or is not a trust, the language of Perry on Trusts, section 111 (3d ed.), is apposite :

“ The point really to be determined in all these cases is whether, looking at the whole context of the will, the testator intended to impose an obligation on his legatee to carry his wishes into effect, or whether, having expressed his wishes, he intended to leave it to the legatee, to act oil them or not, at his discretion.”

It will be noticed, therefore, that the first test to be applied is to ascertain (which is the primary object in the construction of all wills) the intention of the testator. In this will, the testator, by twenty separate clauses (designated Items ”), disposed or intended to dispose of his property, and in every legacy, except the trusts in favor of his two nieces, created by the third and fourth items, and this bequest to the churches in item 20, the words of actual gift and bequest are used. "Where the testator intended to express a wish or make a suggestion, this has been done, as shown by items 16 and 18 of the will, in a way so as not to destroy the absolute character of the gift; and that he knew how to make a bequest for general corporate purposes is evidenced by item 13, wherein we find a direction to pay to the St. Luke’s Hospital * * * for its corporate purposes, the sum of seven thousand dollars ($7,000) to which I give and bequeath the same.”

The weight to be given to such considerations in the construction of a will was lately before this court in the case of Gross v. Moore (68 Hun, 415), wherein it was said: “Apart, however, from this clause itself, if resort be had to the entire will, it will be found that when the testatrix intended to make an absolute gift of her property she used apt and technical language to express her intention. Thus, with respect to the nine bequests given in other portions of the will, she adds, after designating the legatee, that he is to take absolutely and forever.’ In the residuary clause the language used is entirely different, and is consistent only with the view that he was to take the property, not personally and for his own use, but as executor in trust for distribution, in such proportions and to such beneficiaries as she, by her instructions to him, had designated.”

Having in mind, therefore, that where absolute gifts were intended apt words were used, and construing the language here, we think it was intended to give the residuum to the churches, not absolutely, but in trust for the designated purpose of buying coal for the poor, and that it was expressive of an intention on the part of the testator that the churches should not take the gift absolutely, but that the gift was accompanied by a direction as to the manner in which they should apply it, which was sufficient to constitute a trust. The language is not merely commendatory or expressive of a wish, but it is a statement of why the residuum is to be divided and paid to the churches, namely, to buy coal for the poor. Thus, it does not come within that class of cases wherein it has been held that commendatory terms expressive of wish, will, desire, etc., where not suf-eiently commanding, emphatic or imperative, will not raise an implied trust or defeat an implied gift.

The learned trial judge placed his conclusion that the gift was valid upon the authority of Williams v. Williams (8 N. Y. 525); Wetmore v. Packer (52 id. 457), and Fosdick v. Town of Hempstead (125 id. 591).

Williams v. Willianns (supra), though overruled in subsequent decisions upon at least one of the questions therein decided, is an authority for the position that “ corporations are authorized to take property for the use of the society, or other pious uses, which plainly shows that a benefactor may apply his bounty to the whole or any one or more of the various purposes for which the corporations are authorized to hold property.”

The question, however, whether they are authorized to take is not the only question in this case, because we assume upon the authority of the case cited and others, and upon the proof here appearing, that these churches were capable of taking, provided the testator intended to make an absolute gift for any or all of the purposes. But the question we are discussing, and which must control upon this appeal, is, what did the testator intend?

In Wetmore v. Parker (supra) the bequest was to an orphan asylum, and in that case the question was, whether the bequest offended the statute against perpetuities, and this objection was overruled on the ground that the title to the fund passed to the asylum, and that no specific trust was created.

The case of Fosdick v. The Town of Hempstead (supra), we think, is an authority in favor of the appellant. In that case a bequest was made of one-half of a certain fund to the town of Hempstead, “ to be kept as a fund for the support of the poor of said town.” It was therein held that “the gift to the town was not .an absolute one, but in trust for purposes which were not corporate or administrative, and that the town 'could not take it for that reason, and the trust itself is void because of the lack of any ascertained or ascertainable beneficiaries to enforce the same.” And in the opinion Judge Pecicham:, referring to the case of Holland v. Alcock (108 N. Y. 312), says: “ That case leaves the doctrine no longer in doubt that to constitute a valid trust there must be a defined beneficiary, and the absence of such is, as a general rule, fatal to the validity of a testamentary trust. Is there any such beneficiary named or to be found in this will ? The learned counsel for the town says there is, and founds his assertion upon the claim that the beneficiaries are composed of the class defined by law, and are limited to such poor persons as the town is now or may, from time to time, be compelled to support. But we hold that the testator did not intend to limit his charity by any such boundary. His intention was, as we have already stated, to embrace within his charity a much broader while at the same time a much less well-defined class, depending very greatly upon the individual views of the person or persons who, for the time being, exercised the trust, and we say to such an extent is the power of choice vested in the trustee that no one could claim the enforcement of the trust in his own favor or in favor of others. The beneficiaries are neither named nor capable of being ascertained within the rules of law applicable to these cases.”

We think, therefore,-that the cases relied upon do not support the conclusion reached by the learned trial judge, and that the one from which we have just quoted (Fosdick v. Town of Hempstead) is one in favor of appellant.

Our conclusion is that the language, “ to buy coal for the poor,” cannot be disregarded, and that it is not, as was said in The Hatter of Teed (supra), “ extremely loose or meaningless,” but is indicative of an intention to have the property divided among these churches, who were to take it in trust and apply the same in carrying out the testator’s intention, which, violating as it-does the statute rules, cannot be effectuated.

The judgment, therefore, should be reversed and judgment rendered for the appellants, with costs to the appellants to be paid out of the fund.

YaN BeuNT, P. J., and PabKee, J., concurred.

Judgment reversed and judgment rendered for the appellants, with costs to the appellants to be paid out of the fund.


author: Parker, J.:

text:
    First National Bank of Jersey City, Plaintiff, v. Emelie Huber et al., as Executors, etc., of Otto Huber, Defendants.

      Limited partnership — the contribution of the special partner must be in cash — his liability does not abate with his death — entries in the firm books — evidence against Mm — continuation of a limited partnership.

    Upon the attempted creation oí a limited partnership, it was agreed that the indebtedness to the proposed special partner due from, and the amount of his contribution of capital to a former limited partnership between the same general partners and special partner, should be accepted as the contribution of $50,000 required from him as a special partner by the new articles of partnership.

      Meld, that such payment did not conform to the statute, which is satisfied by nothing other than a payment in cash by the special partner.
    "Where the certificate and affidavit made in an attempted formation of a special partnership, although regular upon their face, contain a false statement, the special partner becomes liable for the engagements of the partnership as a general partner, and such liability of the special partner continues as against his estate after his death.
    The entries in the firm boohs of a special partnership are competent evidence against the special partner and in favor of a third person, as being in the nature of admissions of the facts therein stated.
    There can be no continuation of a partnership after its dissolution.
    MotioN by the defendant, Emelie Huber and others, as executors, .etc., of Otto Huber, for a new trial on a case containing exceptions, ordered to be lieard at the General Term in the first instance upon the verdict of a jury for $50,675.15, rendered by direction of the court, in favor of" the plaintiff, at the New York Circuit on the 27 th day of February, 1892.

      Hamilton Wallis, for the plaintiff.

      Louis Marshall, for the defendants.
   Parker, J.:

The defendants’ testator, Otto Huber, was, in his lifetime, a member of the partnership of P. Lenk & Co., which incurred the liability which this action is brought to recover. An action was first brought against the several members of the partnership, including defendants’ testator, but he having died before the trial, it was revived against the surviving partners and prosecuted to judgment. Executions issued thereon having been returned wholly unsatisfied, this action was commenced against tlie defendants as executors of tbe last will and testament of Huber. He did not intend to become a general partner in tbe firm of P. Lent & Co., but a limited partner, and tbe papers by wliicb tbe limited partnership was sought to be created were on their face conformable to tbe statute authorizing such creation. But tbe evidence contained in the record shows that be did not comply with section 1 of tbe Limited Partnership Act (1 R. S. 165, § I), which requires that the sum contributed by the special partner to the common stock shall be paid in cash. The testator Huber was a member of a limited partnership with the same general partners, prior to the attempt to create the partnership in question, and to the common stock of such limited partnership lie had contributed $30,000, and in addition had loaned to the film $20,000.

Upon the creation of the present partnership it was agreed that the indebtedness of the firm to him, and the amount of his original contribution of capital, should be accepted as a contribution of $50,000, which the articles of partnership required him to pay in as special partner, but in so doing he did not conform to the statute, which nothing satisfies except a payment in cash. (Durant v. Abendroth, 69 N. Y. 152; Van, Ingen v. Whitman, 62 id. 516 ; Kohler v. Lindenmeyr, 129 id. 498.)

The certificate and affidavit, while regular upon their face, contained a false statement, and, therefore, under the statute the special partners became liable for the engagements of the partnership as general partners. (1 R. S. 765, § 8.)

The defendants do not deny that the evidence upon which the court based its decision brought Otto Huber within the provision of section 8, but their contention is that, while Huber during his lifetime was liable to the creditors of the firm as if he was a general partner, the cause of action was penal in character and died at the same time as did he.

An attempt is made to show that this provision of the statute is analogous to the one which charges the trustees of a manufacturing corporation with all of its liabilities for the non-filing of its annual report, a cause of action which it is now well settled does not survive the death of the party. But we do not think that the analogy contended for exists, for whether section 8 be regarded as penal in its character or not, the language employed not only manifests an intention to continue the liability beyond the death of such a party as it describes, but it is appropriate and effective to accomplish that result.

If it had provided that in case any false statement be made in the certificate or affidavit, all persons interested in the partnership should be liable for its debts, some support might be presented for defendants’ contention.

But the statute does not stop .there. It goes further and characterizes the hind of liability which shall arise in such event. The character and quality given to it is such that no opportunity for discussion concerning its survivorship is presented. It declares that in such event all the persons interested in such partnership shall be liable for all the engagements thereof as general partners”

Thus, he is not only made liable to pay the debts of the partnership, but he is made liable in the same measure and manner as general partners. And as the liability of a general partner for the engagements of his firm survive his death, so necessarily does the liability of a special partner when it is founded on a violation of section 8.

Defendants further insist that the court erred in receiving in evidence the books of account of the firm of P. Lenk & Co., which expired on the day that the new firm of P. Lenk & Co., which contracted the liability in question, came into existence. Kohler v. Lindenmeyr (supra) is relied on to support defendants’ contention.

In the attempt which was made to form the limited partnership of P. Lenk & Co., now the subject of controversy, Lindenmeyr, as well as Otto Huber, was named as a special partner, and in that case the books were introduced to show that Lindenmeyr did not pay in $20,000 in cash on its formation, but instead a loan made to the old firm of P. Lenk & Co. was accepted in lieu of such contribution, and it was held that inasmuch as he was not a member of the old firm, and it did not appear that he was cognizant of the entries, they were inadmissible as against him. -

In this case the facts were quite different. Huber was a special partner in the original firm of Lenk & Co., and the entries in the books of his firm were competent evidence in favor of third persons as in the nature of admissions of the facts stated. (Kohler v. Lindenmeyr supra.)

There are several answers to the suggestion that while the parties failed to Comply with the statute authorizing the creation of a limited partnership, by the omission of the special partners to pay in their contribution towards the capital stock in cash, the transaction, nevertheless, operated to renew and continue the original limited partnership. But one, however, will be alluded to. The papers do not purport to renew and continue an existing partnership, and, therefore, do not contain the allegations necessary to accomplish such a result.

The parties to the transaction had no such intention. On the contrary, the members of the original firm of P. Lenk & Co., by appropriate action on their part, caused such partnership to be dissolved and the notice thereof to-be duly published. And, having dissolved the partnership, there was none to continue if they so desired. But they did not desire or attempt to continue it, and the court could not, if it would, make another and different contract for the parties than that which they intended and attempted.

The exceptions should bo overruled and judgment ordered for the plaintiff upon the verdict, with costs.

Follett, J., concurred; YaN Brunt, P. J., concurred in the result.

Exceptions overruled and judgment ordered for the plaintiff upon the verdict, with costs.


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    Caroline Rademacher, Respondent, v. The Greenwich Insurance Company of the City of New York, Appellant.

      Action on a, standard fire insurance policy — conditions precedent to a recovery thereon — waiver thereof — evidence as to value.

    In an action brought upon a standard fire insurance policy covering wearing apparel and household goods, to recover the value of such insured property, which had been destroyed by fire, the plaintiff, although not a dealer in the articles injured, testified that for a number of years she had been engaged in housekeeping, and had, from time to time, purchased similar articles to those destroyed, and was familiar with the prices for which they sold.

      Eleld, that an expression of her opinion as to the value thereof by the plaintiff, coupled with a statement of the basis upon which such opinion was predicated, showing that she took the cost of such property and deducted for depreciation twenty-five per cent, was competent evidence upon the question as to the value thereof.
    Whatever the personal views of an appellate court may be ns to the credibility to be attached to the testimony of different witnesses, when there is not a clear preponderance of evidence in favor of one of the parties which would have justified the direction of a verdict in its favor, the verdict of a jury thereon is conclusive.
    Under a policy of fire insurance in the form provided by chapter 488 of the Laws of 1886, the furnishing of proofs of loss, and, in the event of a disagreement, the undertaking in good faith to have an appraisal of the property destroyed, are conditions precedent to a right to recover thereon, and a breach thereof, unless waived, constitutes a defense thereto, and the mere retention of proofs of loss, served after the time limited for their service by the insurer, is not a waiver of the condition precedent.
    In an action brought upon a standard policy of fire insurance, containing a clause requiring that proofs of loss be furnished within sixty days after the occurrence thereof, it was shown that proofs of loss were not furnished until nearly ninety days after the fire; that such proofs of loss were received by the insurance company without objection, and retained by it; that an agreement of arbitration was entered into before the time had expired within which 'the proofs of loss should have been served. The answer did not affirmatively allege forfeiture fpr failure to file proofs of loss, but admitted the receipt thereof subsequent to the sixty days, and denied that the plaintiff had complied with the conditions of the policy.

      Held, that the denial of a motion to dismiss the complaint was not error.
    Appeal by the defendant, The Greenwich Insurance Company of the city of New York, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the city and county of New York on the 13th day of April, 1893, upon the verdict of a jury for $400 after a trial at the New York Circuit, and also from an order made at the New York Circuit on the 11th day of April, 1893, and entered in said clerk’s office, denying the defendant’s motion to set aside the verdict and for a new trial made upon the minutes.

      E. MwidoVph Lobinsón, for the appellant.

      Louis Cohen, for the respondent.
   O’Brien, J.:

Chapter 488 of the Laws of 1886 provides for a uniform policy of insurance, known as the standard ” policy, and makes its use compulsory upon insurance companies. Such a policy the defendant issued to the plaintiff on wearing apparel and household goods, some of wbicb it is claimed were totally and some partially damaged. by a fire occurring on tlie 23d day of February, 1891. Tbe policy contained the usual clauses to be found in standard policies, requiring the insured, if a fire occurred, to give immediate notice of any loss, and the further clause providing for an arbitration in the event of disagreement as to the amount of such loss. Upon these clauses and the fact that the plaintiff claimed $621.66 as her damage, the questions presented upon this appeal turn.

The plaintiff alone testified as to value, and not only her competency but the question of the weight to be attached to her evidence is presented by proper exceptions. It was insisted on the trial, as it is upon this appeal, that there was a fraudulent statement of the amount of loss, that' it did not exceed seventy dollars and fifty-three cents, and that the verdict of the jury was erroneous in awarding $100, as was also the ruling in refusing to dismiss the complaint.

The evidence, though slight and unsatisfactory upon the question of value, was, we think, sufficient for presentation to the jury. Although not a dealey in the articles injured, it nevertheless appeared that the plaintiff for a number of years had been engaged in housekeeping, and had from time to time purchased similar articles and was familiar with the prices at which they sold. This property consisted of wearing apparel and household goods, and an expression of her opinion as to their value, coupled with the basis upofi which such opinion was predicated, showing that she took the cost of such property and deducted for depreciation twenty-five per cent,was some, and, we‘ think, competent evidence upon the question of value. On the part of the defendant the experts testified that the property paifiially damaged was not worth more than $14.0, and that the damage thereto was but seventy dollars. And these experts expressed the belief that this was the, extent of the injury to plaintiff, for the reason that they did not think, from the character of the fire and the appearance of the property in the house where the fire occurred, that any property was totally destroyed. The value of property destroyed the plaintiff had placed at over $200; and the questions were before the jury whether any property had in point of fact been destroyed, and if so,' how much, which, together with the partial damage sustained, would be the amount the plaintiff was enti-tied to recover. Whatever our personal views as to the credibility to be attached to the different versions, we think that where, as here, there was not that clear preponderance in favor of the defendant which would have justified a direction in its favor, the verdict of the jury thereon is conclusive, as it is upon the cognate question of overvaluation.

In addition to the question of. the extent of the loss, the defendant, at the close of plaintiff’s testimony, and again at the close of the defendant’s testimony, moved to ■ dismiss upon the following grounds :

First. That it is a condition precedent of the plaintiff’s right to recover under the policy that her loss should be ascertained by appraisal, and in the case the appraisers disagree, by the decision of an umpire.

Second. That the policy provides that proofs of loss should be furnished within sixty days of the fire, and the plaintiff has shown that they were not served until the expiration of ninety days.

Upon the law there can be no doubt that the furnishing of proofs of loss and, in the event of a disagreement, the undertaking in good faith to have an appraisal of the property, are conditions precedent to a right to recover, and a breach thereof, unless waived, constitutes a defense. (Quinlan v. P. W. Ins. Co., 133 N. Y. 357.) The difficulty to be found in the questions presented upon this appeal is, not in the law, which we regard as settled, but in its application to the facts here appearing. In determining, therefore, the strength of these objections, the testimony relating thereto must be referred to.

Immediately after the fire the defendant was duly notified and sent a person to examine the premises, and although it is not apparent just how it arose, the parties disagreed as to the extent of the loss. The policy required that in the event of such a disagreement the loss should be determined by appraisal, each party selecting one appraiser, and in case such appraisers disagreed, by the decision of an umpire. The agreement of arbitration signed by both parties bears date the second day of April. These appraisers could not agree' and undertook to select an umpire, the defendant’s appraiser selecting four names which were forwarded to plaintiff’s appraiser, and upon which the latter did not act until he had received a letter from defendant’s appraiser calling attention to the names submitted and requesting an answer, which was sent on the thirteenth, of April by the plaintiffs appraiser, who, without objecting in his letter to the names submitted by defendant, proposed three other names. To this the defendant’s appraiser responded, stating that he had made an examination of the standing of the parties submitted to act as umpire, and that he could not accept any of them because he had ascertained that they were not furniture dealers or in any way competent to act in a loss of the kind, and that he would like to hear from the plaintiffs appraiser as to whether he accepted or declined the parties offered by him. In addition, the plaintiff’s appraiser testified that he had suggested the names of furniture men, naming one firm, and that he was unable to agree with the other side upon an umpire.

The motion to dismiss upon this branch was necessarily placed upon the ground that upon this showing by plaintiff, the court was bound, as a matter of law, to hold that the plaintiff had not complied with this condition of the policy in obtaining an appraisal.

In Uhrig v. Williamsburgh Ins. Co. (101 N. Y. 305) it was said: “ Under the arbitration clause it was the duty of each party to act in good faith to accomplish the appraisement in the way provided in the policy, and if either party acted in bad faith so as to defeat the real object of the clause, it absolved the other party from compliance therewith; and, if either party refused to go on with the arbitration or to complete it, or to procure the appointment of an umpire, so that there could be an agreement upon an appraisal, the other party was absolved. The claimant under such a policy cannot be tied up forever without his fault and against his wall by an ineffectual arbitration.” And, as further said in the opinion in that case: “ Upon all the evidence, it was a question of fact for the jury to determine whether there was any breach of this clause in the policy.”

So here, we think, it was upon the evidence a question of fact proper to be submitted to the jury, because plaintiff’s want of good faith was not so clear as to have justified the court in ruling, as a matter of law, that the plaintiff had violated this condition. Had the defendant requested to go to the jury upon this question, it would undoubtedly have been entitled to do so, as upon all the evidence a question of fact was fairly presented whether or not the plaintiff had acted in entire good faith in endeavoring to select, after the appraisers had disagreed, a disinterested and impartial umpire. Such request, however, was not made by defendant, relying, as it did, upon the right to have the question disposed of as a matter of law; and, with this position taken by the defendant, we do not think the ruling of the trial judge was wrong.

The other ground of the motion to dismiss, namely, the failure to present proofs of loss in time, is the most serious question in the case. It is conceded that the fire occurred in February, that proofs were not furnished until May, and that the policy required that they should be furnished within sixty days after the fire. Hpon the law, therefore, unless the evidence shows that this condition has been expressly or impliedly waived, it would bar the plaintiff’s recovery.

The question of what will constitute a waiver has been frequently discussed. In Koller v. German American Insurance Co. (N. Y. Law Jour., Jan. 31, 1893) it was said: “ While a waiver of a condition of forfeiture need not be based upon a technical estoppel, yet, in the absence of an express waiver, some of the elements of an estoppel must exist; the insured must have been misled by some action of the company, which caused the omission to comply with the condition, or it must have done something after knowledge of a breach of the condition, which could only be done by virtue of the policy. (Armstrong v. Ins. Co., 130 N. Y. 560 ; Ronald v. Ins. Co., 132 id. 378.) Forfeitures, plainly incurred and not waived, must be enforced by the courts. (Quinlan v. Ins. Co., 133 N. Y. 356.) * * * Mere silence at a time when it was not required to speak is not a waiver, nor evidence from which waiver may be inferred (Armstrong v. Ins. Co., supra), so that the mere retention of proofs, served after the time limited for their service, is not performance of the condition precedent.”

The facts relied upon in this case to show waiver are the receipt of the proofs of loss without objection, and retaining the same, and the entering into the agreement of arbitration before the time had expired within which the proof of loss should have been furnished.

In Brink v. Hanover Fire Ins. Co. (80 N. Y. 113) it was said: “ If a company intends to avail itself of the technical objection that the proofs are not filed in time, common fairness requires that it should refuse to receive them on that ground, or at least promptly notify the assured of their determination; otherwise, the objection should be regarded as waived.” And though the question has not been -directly passed upon in this State, an argument in support of the proposition, that the entering into an arbitration before notice or proofs of loss have been served is a waiver of notice or proofs of loss, notwithstanding a stipulation in such submission that it shall not operate as such waiver is furnished by the case of Gale v. State Ins. Co. (33 Mo. App. 664).

The answer of the defendants does not affirmatively allege a forfeiture for failure to file proofs of loss, such answer admitting that they were received at the date fixed in the complaint, which was subsequent to the sixty days, but denying that the plaintiff has complied with the conditions of the policy.

Although we think that the question as to a waiver by implication is close, yet in view of the issues and the way in which this question was presented, we think that the trial judge was not obliged to dismiss the complaint. And upon the same motion being made at the close of the case, the additional reason was then furnished by the circumstance appearing that after the appraisers had failed to agree, but within the time limited for filing proofs of loss, the defendant sent three appraisers, who made out a detailed statement of the loss, after fully interrogating the plaintiff upon the extent of her claim.

Our conclusion, therefore, is that the judgment is right and should be affirmed, with costs.

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

Judgment affirmed, with costs.


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    Robert D. Castle, Appellant, v. Corn Exchange Bank, Respondent.

      Title of a bank receiving paper for collection — action for conversion — demand — when necessa/ry, when unnecessa/ry— by whom a demand must be made.

    A bank receiving from another bank, notes, checks or drafts for collection, obtains no better title to them or the proceeds thereof than the remitting bank had, unless it becomes the purchaser thereof for value without notice of any defect in the title to them.
    "When one comes lawfully into possession of property, in order that an action may lie against him for conversion, a demand is necessary, but when the original taking or possession was wrongful, no demand is necessary; and although one may come lawfully into possession of property, yet, if after notice of the rights of the true owner and regardless thereof, dominion and ownership is asserted, then a demand is not necessary.
    Before an action for conversion can he maintained, the person sought to he held must either hy his own act or the act of the owner of the property, he placed in the wrong.
    To constitute a conversion there must he a claim' of ownership as against the true owner, or in a case where the property has come lawfully into the possession of another, there must he a demand for its return hy the owner or his authorized agent.
    A demand hy a third person who has no relation to or does not stand in privity with the owner is insufficient.
    Appeal by the plaintiff, Eobert D. Castle, from a judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the city and county of- New York on the 5th day of May, 1893, upon the verdict of a jury rendered by direction of the court, after a trial at the New York Circuit, and also from an order1 entered in said clerk’s office on the 3d day of May, 1893, denying" the defendant’s motion to set aside the verdict and for a new trial made upon the minutes.
    This action was brought to recover damages for the conversion of a bill of exchange or draft, drawn by the Farmers’ National Bank of Lancaster, Penn., on the First National Bank of New York, and payable to the order of defendant’s cashier, by whom it was indorsed in blank.
    The history of the draft is as follows: In July, 1884, Mary C.. Melson, as executrix, drew a check on the Farmers’ National Bank to the order of John J. Cameron of Indianapolis, for $1,811.84, and caused the same to be delivered to Cameron,' who delivered it,, indorsed in blank, to the firm of A. & J. C. S. Harrison, then doing business at Indianapolis as bankers under the name of Harrison’s Bank.
    It was delivered to the Harrisons and received by them for collection. It was not credited as a deposit in Cameron’s pass book,, but between him and the Harrisons it was plainly agreed that the indorsement and delivery were for collection only. Cameron received no consideration for the check. The Harrisons indorsed the check “ for collection ” to defendant’s cashier, and sent the same by mail to defendant with that indorsement, with a printed letter stating “ we inclose for credit,” and mentioning tins and other items .inclosed with it.
    On receipt of the check defendant sent it to the cashier of the Farmers’ National Bank indoi’sed “for collection,” whereupon the Farmers’ National Bank drew the draft in question and sent it to-defendant in exchange for the check and canceled the check. While this draft was on its way to defendant, Cameron learned of the failure of Harrison’s Bank, and immediately telegraphed Mrs. Melson to stop collection of the check. Mrs. Melson thereupon went to the Farmers’ Bank, and there learning that the draft in question had been mailed to defendant, telegraphed defendant,, informing it of the failure of Harrison’s Bank, and that the check had been left with them for collection, and asking defendant to hold the money on the draft, assuming that the draft might already have-been collected. To this defendant replied, stating that it was the-owner of the draft. Thereupon, acting in pursuance of Cameron’s instructions to stop payment of his check, the cashier of the Fann-ers’ Bank telegraphed defendant, asking it to hold the draft, to which defendant replied: “ Cannot, draft which it paid for was our property.” Thereupon, in pursuance of the same instructions, the-cashier of the Farmers’ Bank requested the First National Bank by telegraph to refuse payment of the draft, which request was complied with.
    Defendant thereupon took steps to collect on the draft from the-Farmers’ National Bank, the drawer, by commencing suit and attaching money of the drawer in the First National Bank to an amount sufficient to pay the draft and costs of action, and the money so attached was paid over under the attachment to-the sheriff, who converted the money to his own use and absconded. Thereupon Cameron assigned to plaintiff the check and draft and all causes of action which accrued against the defendant upon the foregoing facts.

      Jefferson Clark, for the appellant.

      John M. Bowers, for the respondent.
   O’Brien, J. :

The facts here are substantially the same as those appearing upon, the former appeal in the case of Corn Exchange Bank v. Farmers’ National Bank (118 N. Y. 445). Though the title to the draft or its proceeds which is the subject of this action was there involved, the question was not decided, because it was therein held that neither the plaintiff nor defendant in that action was the agent of the owner, and conceding that the latter coidd maintain an action against plaintiff to recover the amount of the check, this was not available to defendant as a defense, as no contract relation existed between it and the owner, nor was there any privity between them.”

Acting, no doubt, upon the intimation thus given, this action was brought by the assignee of the one claiming to own the draft to recover damages for the conversion thereof. Here the evidence showed that the plaintiff’s assignor delivered the check, which was subsequently canceled, and for which the draft involved in this action was substituted, for collection. And as no evidence was -offered on the part of the defendant tending to show that it parted with any value upon the faith of the receipt of such draft, the question of its ownership as having received the same for value does not arise. In determining whether the direction was right, therefore, we can assume that the law as laid down in the case of McBride v. Farmers’ Bank of Salem, Ohio (26 N. Y. 450), which has been cited with approval in numerous cases, is authority for the proposition that a bank receiving from another, notes, checks or drafts for collection, obtains no better title to them or the proceeds than the remitting bank had, unless it becomes a purchaser for value without notice of any defect of iitle. As the defendant does not claim to stand in the position of such a holder for value, it would follow that, unless there is some obstacle to the maintenance of the action, the plaintiff could recover.

There are' three grounds relied upon to defeat such a recovery, only one of which we think need be considered.

The facts show that the defendant came lawfully into possession -of the draft, charged with the duty, as between it and the party from whom it was received, of collecting it. The original check received for which the draft was substituted, as said by Mr. Justice Follett, in C. E. Bank v. F. N. Bank (supra), “ was no longer a valid contract. The liability of the drawer and indorsers thereon was ended, and could never be restored. The Lancaster bank had legally and in good faith discharged its duty to the drawer, the indorsers and tbe bolder of the check, and the Corn Exchange Bank had accepted of the draft of the Lancaster bank in discharge of the liability of the drawer and indorsers.”

Therefore, the bank having come rightfully in possession of the draft, and having rightfully proceeded to enforce its collection, the question presented is, whether the plaintiff can maintain this action without showing that he or his assignor, claiming to own the draft or the proceeds, made a demand before suit brought.

The plaintiff appears to have been impressed by the importance of a demand, because in the complaint, after reciting the facts, it is alleged: “ That on said day, and before such presentation of said draft, all authority of defendant to collect the same was duly countermanded and revoked, and said Cameron thereupon duly demanded that defendant at once deliver to him said draft theretofore indorsed in blank as aforesaid.”

We have examined the record and can find no proof in support of this portion of the complaint. There is no testimony of the plaintiff’s assignor, nor of anyone else on his behalf, showing a demand of the draft.

In view of the authorities, we must regard it as settled law that one who comes lawfully in possession of property is not liable for conversion until after demand and refusal. (Gillet v. Roberts, 57 N. Y. 28 ; 2 Bouv. Inst. §§ 3530, 3531, 3528.) In the last section (3528) it is said: “When the conversion is direct, as by an unlegal taking under a wrongful assumption of property, or a misuse of the chattel, we have seen that the conversion is complete without a demand; but to maintain trover for an indirect conversion, a demand is in general indispensable, because the defendant being lawfully in possession of the goods, there is no conversion before he assumes a property in them.” To the same effect is the American and English Encyclopaedia of Law (Vol. 4, title “Conversion,” p. 115), which not only confirms the rule as stated by Bouvier, but cites the case of Storm, v. Livingston (6 Johns. 44) as authority for its statement that the demand must be made before the action is brought.

The two cases relied upon by the plaintiff to show that no demand is necessary seems to us to have been ill chosen. One, that of McBride v. Farmers' Bank, from which we have quoted supra, is authority for the position that one to whom the right of action was assigned could maintain the action without demand; but this was placed expressly upon the ground that, the assignor having demanded the note before maturity and the proceeds afterwards, the cause of action was thus complete and no new demand necessary. McKee v. Judd (12 N. Y. 622), which is the other case cited by appellant, was an action for the wrongful taking and conversion of personal property, and it was therein held that in such an action no demand or refusal was necessary to maintain the action.

Another and a stronger position taken by appellant to obviate the necessity of a demand is, that though the original possession by defendant was lawful and a demand to place it in the wrong would have been necessary, yet, it appearing that the defendant assumed ownership and converted the draft and proceeds to its own use, this was such an unwarranted and unjustifiable position as to do away with the necessity of a demand.

While it may be stated as a general proposition that where one comes lawfully in possession of property, in order that an action may lie against him for conversion, a demand is necessary, and also that where the original taking or possession was wrongful, no demand is necessary, there is still authority for the further position that though one may come lawfully into possession of property, if, after notice of the rights of the true owner and regardless thereof, dominion and ownership is asserted, then demand is not necessary. Or, as held in Boyce v. Brockway (31 N. Y. 490): “Where the assumption of dominion over property is in hostility to the rights of the true owner, such assumption amounts in law to a conversion. To maintain an action for the wrongful conversion of property, it is enough that the rightful owner has been deprived of it by the unauthorized act pf another assuming dominion over it.”

The principle underlying these different instances of when conversion will lie is the same in all, requiring that before an action for conversion can be maintained the person sought to be held shall, either by his own act or the act of the owner of the property, be placed in the wrong. Applying this principle, we think that the evidence in this case is clearly insufficient to justify the inference that the defendant, in the absence of any demand, was placed in the wrong. In other words, we do not think that the testimony tended to prove that the defendant was guilty of conversion.

Tbe only evidence tbat conld be tortured into a demand, or assigned as supporting tlie theory of a conversion, is a telegraphic correspondence passing between defendant and the maker of the check and the Fanners’ National Bank. The first of these telegrams sent by the maker of the check simply requested the defendant to hold the money on the draft in suit, stating that the bank to which it had been delivered for collection had suspended. In this we find no demand for the draft, either on her behalf or on that of any other person. The other dispatch was sent by the Farmers’ National Bank and reads: “ Can you hold our draft on 1st N. Y. sent yesterday. The drawer and indorser would like to have the money held for their account.” This but asks the defendant to hold the draft, and contains in addition a statement that the drawer and indorser would like to have the money held for their account. But here, again, no demand for the draft was made, nor is there any reference to the ownership claimed by plaintiff’s assignor.

Ye think it appears, therefore, that no demand was ever made by plaintiff’s assignor, or by any person authorized by her to make such demand. It is true that the defendant, in answer to one of the telegrams, stated that it claimed the draft as its own. This cannot be taken as a refusal after demand by the owner, when demand was never made, because as against both the persons sending the draft it was the duty of the defendant, a duty which he owed to its principal, who had sent the original check to it, to enforce the payment of the draft which was substituted therefor, and it can hardly be claimed that asserting a claim as against the drawers, or proceeding to collect the draft, which it was its duty to do, was conclusive as between it and the true owner of a conversion of the draft or its proceeds.

To constitute conversion there must be a claim of ownership asserted against the true owner, or in a case where the property has come lawfully into the possession of another, there must be a demand for its return by the owner or his authorized agent. A demand by a third person, who has no relation to, or does not stand in privity with, the owner, is not sufficient.

In our opinion, as the defendant was never placed in the wrong, and never had any demand of it by the righful owner, the action for conversion would not lie, and the evidence, as it stood at the close of tbe trial, justified tbe direction of a verdict in defendant’s favor, if, upon no other ground, upon this ground alone.

We think that the direction was right, and that the judgment appealed from should be affirmed, with costs.

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

Judgment affirmed, with costs.


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    Henry Winthrop Gray, as Receiver, etc., Respondent, v. Julius Levy and Others, Appellants.

      Action by a receiver — an order alone, insufficient evidence of his appointment — issue raised by denial — exception.

    The simple introduction in evidence upon a trial of an order appointing a person receiver of certain property is not, without additional proof to establish such fact, sufficient to justify a finding of the right of the court to make such appointment.
    Where the jurisdiction of a court to appoint a receiver is dependent upon special facts, which it is essential to establish, it is competent for the defendants, in an action brought by such receiver, to put such facts in issue by denying the statements of the complaint, and an exception to the finding of such facts is available upon appeal to the persons taking the same.
    Appeal by. the defendants, Moses S. Levy and others, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the city and county of New York on the 13th day of May, 1892, upon the decision of the court after a trial at the New York Special Term.

      Robert Payne, for Moses S. Levy, appellant.

      Ira Leo Bamberger, for Muhlhauser, appellant.

      Gratz Hathcm, for Croner, appellant.

      George Y. Brower, for the trust company, appellant.

      George Zabrishie, for the receiver, respondent.
   O’Brien, J.:

The plaintiff having been appointed by an order of this court receiver of the property and assets of the limited co-partnership, known as Levy Brothers & Co., brought this action, asking by way of relief that a certain action brought by the defendant Mulilhauser, in which the defendant Croner was appointed receiver of the same property of said limited co-partnership be vacated, set aside and all proceedings thereunder adjudged to be illegal, null and void.

Subsequent to the bringing of the action, the defendant, the "Kings County Trust Company, by an order in supplementary proceedings, was appointed receiver of all the property, etc., of the firm of Levy Brothers & Co., judgment debtors, and of the property of the individual members of said firm. The defendant, the National Park Bank, having obtained an attachment, shortly afterwards commenced a'suit in equity in this court against Levy Brothers & Co. and upwards of 130 other defendants, who had seized in many actions of replevin the stock of goods on which the attachment of the bank had been levied, in aid of the attachment, for the purpose of procuring therein an adjustment of all conflicting claims and rights in respect to the attached property. In that action Mr. Gray, the plaintiff here, was duly appointed receiver and qualified. The facts in relation to the appointment of the Kings County Trust Company, and of Mr. Gray, in the suit brought by the National Park Bank respectively, as receivers, were alleged by supplemental complaint.

It will thus be noticed that we have here as parties four receivers claiming under different titles an interest in all or some of the property of the firm of Levy Brothers & Co. The plaintiff’s title as special receiver appointed in the National Park Bank suit need not be considered for two reasons : First, that it was intended to extend only to the property which had been seized under the attachment of the bank; and, secondly, because the court below held that it would administer the estate through only one of the conflicting receiverships, and for that purpose held in favor of plaintiff’s title in the Hardt suit, in which this plaintiff was originally appointed, and wherein and upon which title he originally brought this action.

The answer of the defendant Moses S. Levy admitted that he and those associated with him “ undertook to form a limited partnership.” The defendant Mulilhauser denied upon information and belief the allegation with respect to the formation of the limited partnership. The Kings County Trust Company, by their answer, put in issue the allegation as to a limited partnership and alleged that the firm of Levy Brothers & Co. was a general and not a limited partnership. To the finding that it was a limited partnership Moses S. Levy and certain of the other defendants excepted.

The Ilardt action, in which plaintiff was appointed receiver, proceeded and a judgmeut was entered, among other things, holding that the firm was a limited co-partnership, and from the judgment thus entered an appeal to this court was taken. Upon such appeal the judgment was reversed, and it was held that the partnership was a general and not a limited one. (Hardt v. Levy, 72 Hun, 225; 25 N. Y. Supp. 248.) Mr. Justice Parker in his opinion says: The plaintiffs as general creditors of a firm of which the defendants are members instead of proceeding in actions at law to secure their respective claims, instituted this action in behalf of themselves and all other creditors of the firm, having for its object the appointment of a receiver and ultimately a ratable distribution of the assets of the partnership. Such a suit cannot be maintained against the members of a general partnership, but it was long ago held in Innes v. Lansing (7 Paige, 583), that it might be against the persons forming a limited partnership after insolvency. * * *

These plaintiffs chose to proceed in equity, as they may if the partnership be limited, and may not if it be general.”

This action proceeded to judgment before the decision above referred to was reached ; but there can be no doubt that if it can be resorted to, it is conclusive upon the title, not only of this plaintiff, but also of Croner in the similar action brought, upon the theory of a limited partnership in Kings county.

The question then presented is, is the judgment of the General Term, which is conclusive upon the plaintiff’s title, available to the defendants upon this appeal %

It is urged, and with much force, that though an issue as to whether it was a limited or a general partnership was raised by the answer of certain of the defendants, this was not presented in the form of a counterclaim upon which any affirmative relief was based, and though it were, that the validity and regularity of the plaintiff’s appointment as receiver in the Iiardt suit are not open to question in this action. It is insisted by the respondent that in the order appointing the plaintiff receiver, as the court had jurisdiction of the parties and proceeded in accordance with the provisions of the statute, its order cannot be attacked collaterally by inquiring whether the court erred in the decision of any question of law or fact involved in making the order, but that this can only-be done by an appeal or by a direct proceeding to set it aside, citing in support of this position many eases.

Though it be conceded that- the rule of law relied upon is correct, that the regularity of an appointment cannot be attacked collaterally, it must be remembered that in this action the question presented involves one of jurisdiction to make the appointment, and, it seems to us, is directly and not collaterally raised. Upon the trial, the plaintiff, in support of his title, and of the allegations of his complaint that the firm was a limited co-partnership, which was the basis of the court’s right to make the original order appointing him receiver, proved the same facts substantially as appeared in the suit of Hardt v. Levy, including the certificate of limited partnership and the two certificates pm-porting to be renewals of the same. It was also made to appear that there was not at any time any co-partnership agreement between the partners other than the certificate of limited partnership.

The question, therefore, whether the plaintiff’s title was directly or collaterally involved, it seems to us, is to be disposed of by a consideration as to whether or not without the finding which was made in this action upon the allegations and proof that the firm of Levy Brothers & Co., rvas a limited partnership, and that by order in an action brought by a general creditor against such co-partnership he was appointed receiver, a judgment would have been given in his favor.

The right of the court to appoint the plaintiff as receiver depended •upon the fact being established that it was a limited partnership; and the introduction of the order of appointment without additional proof to establish this fact would not have justified the finding which was the basis of the plaintiff’s title, not only to the receivership, but to maintain this action itself.

In Springs, Receiver, v. The Bowery National Bank (63 Hun,505) the complaint alleged that the plaintiff was appointed receiver of a corporation byjin order of the Supreme Court, which order the answer alleged the court had never acquired 'jurisdiction to make. Upon tlie trial tbe plaintiff put m evidence tbe order, wbieb bad been duly filed. As said in tbe opinion in that case : “We think that, in tbe face of this denial of the answer, tbe order was not sufficient to prove tbe appointment, of tbe plaintiff as receiver of tbe corporation. * * * And it was necessary to prove tbe commencement of an action, and that tbe court obtained jurisdiction over tbe corporation as provided id that, section of tbe statute before cited (§ 1, chap. 378, Laws of 1883), to sustain the allegation that tbe plaintiff was duly appointed receiver.’’'

So here, where tbe jurisdiction of the court to appoint a receiver is dependent upon special facts which it is essential to establish, it is competent for tbe defendants to put in issue such facts by denying tbe statements of tlie complaint; and an exception to a finding of such facts Is available upon appeal to tbe persons taking such exception.

We think, therefore, that as the title of the plaintiff was directly involved, and as tbe finding supporting such title was excepted to and was erroneous, under tbe case of Hardt v. Levy (supra), tbe judgment must be reversed and a new trial ordered, with costs to the appellants to abide tbe event.

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

Judgment reversed and new trial ordered, with costs to appellants to abide event.


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    Nathaniel Jarvis, Jr., Respondent, v. The Manhattan Beach Company, Appellant.

      Finding of a jury, when conclusive — question of good faith — rights of a bona fide holder of an apparently genuine certificate of stock,

    "When the question of fact, as to whether or not certain representations as to the validity of certain certificates of stock were actually made hy the defendant, is submitted to a jury upon conflicting evidence their finding is conclusive.
    The circumstances considered under which a party to an action was properly refused his request to go to the jury on the question of the good faith of a third person.
    Where a certificate of stock shows apparently all the essentials of genuineness a bona fide holder thereof is entitled to recognition as a stockholder if a new certificate can he issued to him, or to indemnity if this cannot he done.

      Appeal by tlie defendant, The Manhattan Beaeli Company, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the city and county of New York on the 20th day of January, 1893, upon the verdict of a jury for $3,410, after a trial at the New York Circuit, and also from an order entered in said clerk’s office on the 26th day of January, 1893, denying the defendant’s motion to set aside the verdict and for a new trial made upon the minutes.

      William J. Kelly, for the appellant.

      Charles Steele, for the respondent.
   O’Brien, J.:

The facts appearing upon the former appeal and the decision of this court thereon will be found reported in 53 Hun, 362. So far as the same questions are here involved that decision is controlling. In accordance with the views expressed in the opinion, the question of fact as to whether or not the representations as to the validity of the certificate on which Fox & Co. relied were actually made by the defendant was submitted to the jury, and their finding in plaintiff’s favor is conclusive.

But the appellant insists that there are some material differences between the testimony adduced at the last and upon this trial, which will be briefly noticed.

Upon both trials it appeared that one Fullerton was the clerk in the office of the defendant, to whom was assigned the duty, under the direction of the treasurer of the company, of attending to the transfers of stock. A member of the firm of Fox & Co. testified that he knew that Fullerton was a clerk, and that he had been introduced to him as an employee of the defendant. It also appeared that Fox & Co. guaranteed Beguell’s signature without knowledge that it was genuine, and that such guaranty was pursuant to a rule of the Stock Exchange, without compliance with which it would not have been there negotiable, such signature afterwards appearing to have been that of a fictitious person. It further appeared that the firm of Fox & Co. had done considerable business with this clerk, and that he kept an account with, them; also, that in addition to this, other certificates of the defendant had been from time to time by him given to Fox & Co., and that in some instances tliat firm were accustomed to liave tliose shares transferred in the name of a clerk in their employ, thereafter selling the same upon the Stock Exchange.

This evidence brings up the only new question in the case, which was presented by defendant’s request to be allowed to goto the jury upon the question of the good faith of Fox & Co., to whose interests the plaintiff succeeded. The court refused this request upon the ground that there was not evidence enough to carry this question to the jury, to which refusal the defendant excepted.

In addition to the reason assigned by the judge in the court below, we think there is another ground upon which the ruling could be upheld. It was not claimed that these other transactions were in any way connected with the certificate here involved; nor was it claimed that this certificate was issued in the name of Fox & Co., or any of their employees, nor did they, as in the instances testified to, have it transferred. They presented it at the office of the registrar, the Central Trust Company, and to the defendant company itself, to ascertain whether it was genuine and valid and would be accepted for transfer, so that they would be safe in indorsing it for delivery on the Stock Exchange. It must be remembered that there was no evidence that Fox & Co. were in any way connected with the fraudulent transactions of Fullerton, their relation being simply that of brokers, who in selling the certificates for Fullerton received only their usual commission. So that against any slight inference to be drawn from the evidence to which we have adverted, there were on the other side these facts appearing, together with the additional one that it is hardly to be presumed that they would have guaranteed the certificate, and thus become liable for its genuineness, when they had no interests whatever in the proceeds of sale beyond their regular broker’s commission. Or if they had been participators in the clerk’s fraudulent acts it is hardly probable that they would have gone to the pains of making inquiries at the office of the trust company and the office of the defendant, which should have brought home notice to the defendant of the fraudulent character of the certificate.

It will thus be seen that against a very slight presumption of fraud or bad faith, there was a great preponderance in favor of the view that Fox & Co. acted with prudence, and followed in the transactions tbeir ordinary methods and course of business. There can be no question that had the certifícate been presented for transfer, and a demand for a new one made, in view of tlie evidence showing what was done in similar instances, the holder would have obtained such new certificate, and that, as against a person holding such new certificate, the defendants, under the authorities of Manhattan Beach Co. v. Harned (27 Fed. Rep. 484) and the decision of this court upon the former appeal, would have been estopped.

Since those cases were decided, it has been held by the Court of Appeals in Fifth Avenue Bank v. 42d St. & Grand St. Ferry R. R. Co. (137 N. Y. 231) that where a certificate of stock shows apparently all the essentials of genuineness, a Iona fide holder thereof is entitled to recognition as a stockholder if a new certificate can he legally issued to him, or to indemnity if this cannot be done. That case, together with other cases decided hy this court and one handed down herewith (The Hanover National Bank v. The American Bank & Trust Co. ), fully discusses the legal principles that underlie the question of a company’s liability upon forged certificates of shares of stock, which need not be here further elaborated. Upon the law determining the rights and liabilities of parties with respect to fraudulent certificates of stock, those cases are controlling in this court.

"We have examined the exceptions taken to the rulings upon questions of evidence, but do not regard them of sufficient importance to require any special consideration, or to justify our interfering with the verdict of the jury.

We think, therefore, that the judgment should be affirmed, with costs and disbursements.

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

Judgment affirmed, with costs and disbursements.

       See ante, page 55.