text:
    Charles Davis, as Receiver of The Elmira National Bank, Respondent, v. Charles H. Knipp, Appellant.

      National bank — purpose of the National Banking Law — a claim against a bank purchased after its insolvency and before the appointment of a receiver — cannot be set off against a claim of the bank.

    Under the provisions of the National Banking Law, sections 5236 and 5242 of the United States Revised Statutes, the rights of creditors of a national bank become fixed at the time of an act of insolvency upon the part of the bank. The receiver of a national bank is a trustee for creditors, and represents also to some extent the bank and its stockholders.
    The purpose of the United States statute in question was to prevent preferences among creditors, unless such preferences were based on some right that had accrued before insolvency.
    A receiver of a national bank having brought an action upon .a promissory note made by the defendant and owned by the bank, the defendant interposed an answer setting up by way of counterclaim the fact that two days after the bank suspended business it was indebted to the firm of Knipp & Clark,' of which he was a member, in a sum named for moneys deposited by such firm; that Knipp & Clark gave the defendant a check for the moneys, and assigned to him their claim, and that the defendant had been prevented from presenting the check for payment, because the banking house was closed and its business was suspended;
    Upon appeal from an interlocutory judgment sustaining a demurrer interposed by the plaintiff,

      Held, that as the defendant had purchased the claim against the bank, after the bank had committed an act of insolvency, although before the appointment of a receiver, the claim was not a proper subject of offset under the statutes of the United States, nor under the provisions of section 502 of the Code of Civil Procedure.
    Appeal by the defendant, Charles H. Knipp, from an interlocutory judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Chemung on the 15th day of August, 1895, sustaining the plaintiff’s demurrer to the defendant’s answer, and also from the decision and order of the court, filed in said clerk’s office on the 15th day of August, 1895, directing the entry of said judgment.

      Youmans do Moss and Roswell R. Moss, for the appellant.

      Ohcvrles H. Peck, for the respondent.
   Merwin, J.:

In the complaint it is alleged that The Elmira National Bank was incorporated as a national banking association on August 1, 1887, under the laws of the United States, and as such carried on the business of banking at Elmira down to and until the 23d day of May, 1893, when it became insolvent, closed its doors and then and there suspended and discontinued its business, and has not since resumed the same; that on the 26th of May, 1893, the Comptroller of the Currency of the United States having become satisfied of the insolvency of the bank, and being thereto duly authorized by law, appointed the plaintiff, Charles Davis, receiver of the -bank by a certificate dated that day, and the plaintiff duly qualified, and ou the 2d of June, 1893, entered upon the trust, took possession of the assets of the bank, and ever since has been and now is engaged in the discharge of his duties as such receiver, among which duties is the collection of all debts due the bank; that on or about the 18th of February, 1893, the defendant, for value received, executed and delivered to the bank his promissory' note for <¡¡>500, payable to the order of the bank, and at the bank three months after the date thereof, and this note was transferred to the plaintiff as such receiver, and is still held and owned by him as such; that the note was duly presented for payment, and no part has been paid except forty-nine dollars and thirty-one cents, paid September 28, 1893.

In the answer no part of the complaint is denied except the allegation of payment. In the second count of the answer, being one of the counts demurred to, it is alleged by way of offset and counterclaim that the said bank is such corporation and the plaintiff such receiver thereof as in the complaint alleged; that on the 25th of May, 1893, the bank was indebted to the firm of ICnipp & Clark in the sum of forty-six dollars and ninety-four cents for moneys theretofore deposited by them therein, and at the date named the said firm gave to defendant a check for said moneys, and assigned to defendant their claim therefor; that the defendant has been prevented from presenting the check for payment by reason of the fact that prior to and on the 25th of May, 1893, the bank and its banking house was and has continued to be closed and its ’ business suspended, it refusing and neglecting to pay all and every of its obligations.

The other counts demurred to are in the same form except as to the amount of the debt and the name of the depositor. All are for claims assigned intermediate the failure of the bank and the appointment of the receiver.

The demurrer is upon the grounds that the counts demurred to • are respectively insufficient in law upon the face-thereof, and that, they do not state facts sufficient to constitute a cause of action.

It is not claimed that the defendant has any cause of action against the receiver except by way of offset to the claim sued, upon.

The insolvency of the bank on the 23d of klay, 1893, is admitted.. (Long v. Mayor, etc., 81 N. Y. 427.) After that, and before the-appointment of the receiver, the defendant purchased claims against the bank. Are they available to him in this action by way of offset ? The defendant claims that his rights are to be determined as of the-date of the appointment of the receiver." The plaintiff claims that the right of offset must be determined as of the date of the insolvency.

The provisions of the National Banking Law (U. S. Rev. Stat.),, which are claimed to be applicable, are as follows:

“ Sec. 5236. From time to time, after full provision has been first made for refunding to the United States any deficiency in redeeming the notes of such association, the Comptroller shall make a ratable dividend of the money so paid over to him by such receiver on all such claims as may have been proved to his satisfaction or adjudicated in a court of competent jurisdiction, and, as the proceeds of the assets of such association are paid over to him, shall make further dividends on all claims previously proved or adjudicated ; and the remainder of the proceeds, if any, shall be paid over to the shareholders of such association, or their legal representatives, in proportion to the stock by them respectively held.”

“ Sec. 5242. All transfers of the notes, bonds, bills of exchange,, or other evidences of debt owing to any national banking association, or of deposits to its credit; all assignments of mortgages, sureties on real estate, or of judgments or decrees in its favor; all deposits of money, bullion or other valuable thing for its use, or for the use of any of its shareholders or creditors, and all .payments of money to either, made after the commission of an act of insolvency, or in contemplation thereof, made with a view to prevent the application of its assets in the manner prescribed by this chapter, or with a view to the preference of one creditor to another, except in payment of its circulating notes, shall be utterly null and void; and no attachment, injunction or execution shall be issued against such association or its property before final judgment in any suit, action or proceeding in any State, county or municipal court.”

The question involved upon this appeal was considered in Venango National Bank v. Taylor (56 Penn. St. 14), and it was there held that the defendant, a debtor of the bank, could not use as an offset a claim of a depositor purchased the day after the bank, being insolvent, closed its doors, and before the appointment of a receiver. It would give a preference to one creditor of the bank after the act of insolvency, and would defeat the primary object of the statute. The doctrine of that case was approved in Scott v. Armstrong (146 U. S. 511), where it is said: “ The state of case where the claim sought to be offset is acquired after the act of insolvency is far otherwise, for the rights of the parties become fixed as of that time, and to sustain such a transfer would defeat the object of these provisions. The transaction must necessarily be held to have been entered into with the intention to produce its natural result, the preventing of the application of the insolvent’s assets in the manner prescribed.”

In Snyders v. Armstrong (37 Fed. Rep. 18, 21) it is said that the fact that the claim sought to be set off was assigned to the debtor of the bank after the act of insolvency “ makes all the difference imaginable, for it is well settled that the rights of the parties become fixed at the moment and by the act of insolvency, and any subsequent change of the then situation, by assignment or other transfer, ■cuts off this equity of ‘ insolvency set-off,’ if I may call it so.”

In Armstrong v. Warner (49 Ohio St. 376, 391) the equitable right of set-off existed at the time of the failure, and was, therefore, allowed. In National Bank v. Colby (21 Wall. 609) it was held that an attachment against the property of a national bank, organized under the act of 1864, obtained after the bank became insolvent and before the appointment by the Comptroller of a receiver, was not good as against the receiver. The claim sustained by the court in Hughitt v. Hayes (136 N. Y. 163, 165) related to demands held by the plaintiff against the bank at the time of its failure.

The receiver is a trustee for creditors (Scott v. Armstrong, 146 U. S. 507) and represents also to some extent the bank and its stockholders. (Case v. Terrell, 11 Wall. 202.) The statute was intended to prevent preferences among creditors (Robinson v. Nat. Bank of Newberne, 81 N. Y. 393) unless based on some right that had accnied before insolvency. Yery clearly the object of the law would be frustrated if a valid set-off could be obtained by a debtor under the circumstances alleged in this case. Nor do w.e think that the defendant, under the provisions of section 502 of the Code of Civil Procedure, acquired any right of set-off superior to the claim of the receiver. We are referred to no authority that sustains that proposition. The case of Elmira Savings Bank v. Davis (142 N. Y. 590) is based on an entirely different- theoiy. There the right of plaintiff was initiated before insolvency. The assets of the bank are in the hands of the receiver to be administered under the Ranking Law (Rosenblatt v. Johnston, 104 U. S. 463), and that law, so far as applicable, must control in this action although it is brought in a State court. We are of the opinion that as against the receiver the defendant upon his assigned claims has no right of set-off. The judgment must, therefore, be affirmed.

Hardin, P. J., and Parker, J., concurred.

Judgment affirmed, with costs.


source: Caselaw Access Project

author: Mekwin, J.:

license: Public Domain

text:
    Patrick Preston, Respondent, v. The City of Syracuse, Appellant.

      Building contract — claim by a contractor for extra work caused by a failure to protect work done before the date of Ms contract — a/rbitration clause as to extra work — a provision for an arbitration does not create a condition precedent — waiver.

    Prior to December, 1893, the board of education of the city of Syracuse entered into a contract with Isley and Dixon to build a school house, but the contractors having abandoned the contract when the building was partially constructed, the board, on December 31, 1893, entered into a contract with Patrick Preston to complete the mason work, one of the provisions of which contract required the building to be taken down, so far as regarded the walls, to the water table, and a clause in the specification provided that “Particular care must tie taken of all tke finished work as the building progresses, which work must be covered up and thoroughly protected from injury or defacement during the erection and completion of the building.”
    ‘The beginning of the work was necessarily postponed until March, when it was discovered that the inside walls had been injured by water and frost during the winter, and Preston was directed to take down and rebuild the defective inside walls and he subsequently brought an action to recover for work, labor and materials done, performed and furnished in so doing, on the ground that such alteration was extra work;

      Held, that’ the plaintiff was not responsible for the neglect of the original contractors or of the architect in not having properly protected the walls existing when he made his contract;
    That the finished work which he was bound t.o protect, under the specifications, was only the work which he had done himself.
    A clause in the contract provided that the value of any changes in the work was to be mutually agreed on in writing between the architect and the contractor beforehand; that in default of such agreement the fair value of the same, as determined by the architect, should be added or deducted as the case might be, but that, if any dispute arose respecting the value as thus determined, then the same should be valued by two competent persons, one employed by the proprietor and the other by the contractor, and that these two should have power to name an umpire whose decision should be final. Upon the trial of ■.the action the plaintiff’s claim for this extra work was disputed upon the ground that its value had not been determined under this clause. The architect, however, testified that he could not determine the value in advance, and •the plaintiff testified that, at the request of the architect, he kept an account of the material and labor furnished for such work, made out a bill for it and delivered it to the architect. It did not appear that the bill was disputed; the position taken by the defendant being that it was not liable for any amount.

      I-Ield, that it was doubtful whether the obtaining of an adjustment of the value of the extra work from the architect, or by arbitration, was necessary as a condition precedent to a right of action, but that, even if it were necessary, there was in this case sufficient evidence of a waiver of the condition.
    Appeal by the defendant, The City of Syracuse, from a judgment of the Supreme Court in favor of the plaintiff, entered in the office of the clerk of the county of Onondaga on the 20th day of March, 1895, upon the verdict of a jury rendered by direction of •the court after a trial at the Onondaga Circuit.
    This action was brought to recover for extra work alleged to have been performed by the plaintiff under a contract entered into between the plaintiff and the city of Syracuse for mason work on a school building in process of erection by the board of education «of the city of Syracuse.

      Charles E. Ide, for tbe appellant.

      M. E. Driscoll, for tbe respondent.
   Mekwin, J.:

Prior to December, 1892, tbe board of education of defendant entered into a contract with Isley & Dixon for tbe construction of a brick school bouse on Montgomery street. The building was partially constructed, and then, in December, 1892, tbe contractors abandoned tbe contract. On tbe 31st of December, 1892, tbe board of education entered into a contract with tbe plaintiff to complete tbe mason work of tbe building in accordance with tbe plans and specifications of tbe architects for .a certain sum. In the specification was the following clause: “Note.— Building at present up to first floor joists. All outside brick walls to be taken down to water table.” There was also the following clause: “ Particular care must be taken of all tbe finished work as tbe building progresses, which work must be covered up and thoroughly protected from injury or defacement during tbe erection and completion of tbe building.”

Tbe time at which the work under the plaintiff’s contract should be commenced was not specified in tbe contract. Soon after tbe contract was made tbe plaintiff applied to tbe architects for leave to go on, but, by reason of the weather and the impracticability of then ascertaining to what extent tbe walls already up might be injured by the frost, it was deemed best to postpone the work until spring, and tbe work was not commenced until the latter part of March. It was then discovered that it was necessary to take down to some extent the inside walls and rebuild them before the plaintiff could proceed to the completion of the building from the point to which it was completed at the time the contract was entered into. It was shown that such inside Avails had become defective by reason of the action of water and frost during the winter. When the situation was ascertained the plaintiff was directed by the board of education and by the architects to take down and rebuild the defective inside walls. This he did, and in this action seeks to recover the expense in labor and materials of doing it. Tie showed the expense to be $600.50, and that no part had been paid. On the part of .the defendant the value of the work and materials was shown to be $524.40, and for this sum and interest the verdict was ordered. The defendant aslred to go to the jury “on the question as to whether the injury to these walls resulted from the failure upon the part of Mr. Preston to protect the work then completed at the time he took the contract, which was the thirty-first of December.” This the court refused, on the ground that the plaintiff was under no obligation under the specifications or the contract to protect the work then constructed. The exception by the defendant to this raises the main question in the case.

It was quite apparent, as the court said, that the defective condition of the inside walls was due to fhe unprotected condition of the work during the winter. The claim of the defendant is in effect that it was the duty of the plaintiff immediately upon the execution of his contract to investigate and see if the work already done was properly protected, and to remedy any defect in that line. The contract did not impose that duty on him. The clause as to care of finished work related to his own work to be done under the contract and not to what had been previously done by some one else. The architect called as a witness for the defendant testified that “ when he (plaintiff) took that contract he was to tear down the outside wall of the building from the first floor joists down to the water table and relay it. Everything else was all in good shape up to that point, but the outside was not laid right. "We put it in the specifications that the outside wall would have to be taken down to the water table and relaid. In other words, the other walls looked all right up to that time. Q. That was the understanding when you made the contract ? A. Yes, sir.” Nothing seems to have been said to plaintiff about protecting the work of his predecessor. The architects had as good or better means than the plaintiff had for knowing whether the walls were or were not adequately protected. The court did not, we think, err in holding that the plaintiff was not responsible for the neglect of the original contractor or of the architects in not having the walls properly protected.

Clearly the work in question was outside of the work for which the price named in the contract was to be paid.' The defendant, however, claims that the plaintiff cannot recover because the value of the extra work was not before suit determined by the architects or by arbitrators in case of dispute as to the value, in accordance with the provisions of the contract on the subject of extra work. The clause of the contract on which this claim is based provides that in case changes are ordered “the value of such changes to be mutually agreed on in writing between the architects and contractor beforehand; in default of such agreement in writing, the fair value of the same, as determined by the architects, shall be added to or deducted from the contract price, as the case may be ; but should any dispute arise respecting the. value as so determined, then the same shall be valued by two competent persons, one employed by the proprietor and the other by the contractor, and these two shall have the power to name an umpire, whose decision shall be binding on all parties.”

The architect Merrick testifies that it was practically impossible to estimate beforehand how much the cost or value of the change in question would be. According to the evidence of the plaintiff, which is not denied, he, at the request of the architects, kept track of the material and labor furnished for the particular work in question, and when the work was done he made, out a bill of it and delivered it to the architects in August. This suit was commenced in December. There is no evidence that the amount was disputed, but the position of the defendant or those representing it was that they were not liable at all. The plaintiff may well have believed that he had done all that was required in regard to fixing the amount. Besides, at the trial at the close of the evidence, the only question then raised was that the plaintiff could not recover by reason of his neglect to protect the walls .from the date of his contract. On the motion for nonsuit the question that the amount had not been properly ascertained was not specifically raised.

We are inclined to the opinion that, under the ruling in the case of Seward v. City of Rochester (109 N. Y. 164), the obtaining of an adjustment of the value by the architects or by arbitration was not a condition precedent to a right of action. Assume, however, it was, there is evidence tending to show a waiver. So that the motion for a nonsuit was properly denied, and as at the close of the case no point was made as to this and no request to go to the jury on the subject, the defendant will be deemed to have assented to the disposition by the court of any question that may have existed on the subject.

We find no good reason for reversing the judgment, and it should be affirmed.

Hardin, P. J., and Parker, J., concurred.

Judgment affirmed, with costs.


author: Merwin, J.:

text:
    Clarence A. McVee, an Infant, by Frank McVee, his Guardian ad Litem, Respondent, v. The City of Watertown, Appellant.

      Highways of municipal corporations — dedication and acceptance — effect of a map made by the owner — liability of the city — burden of proof as to opening and working — allowing a four-yea/)'old child on the street alone is not contributory negligence.

    A public highway may be created by dedication through offer and actual acceptance, and the question whether a public highway has been so created is ordinarily one of fact.
    Where a plat, showing streets, is made and recorded by an owner of land, the requisite intention upon the part of the owner is ordinarily indisputable, while the dedication and acceptance may be proved by the acts of the parties and the circumstances of the case.
    Where a city assumes authority to control land as a street, it is chargeable with the same duties and is subject to the same liabilities as>if the street had been lawfully laid out, and it is estopped from questioning the fact that it is a lawful street.
    The provisions of law which enact that every highway that shall not have been opened and worked within six years from the time when it was dedicated to the public use, or when it was laid out, shall cease to be a highway, are to be construed as meaning that the street or highway must have been opened as such over its entire route, but these provisions do not mean that it must have been worked in every part; it is sufficient that it has been worked to such an extent that it was passable for public travel.
    Where a city urges that a street has not been worked within six years, the burden of proof is upon the city to show that fact.
    Although a sidewalk, defective in its construction, was not laid by a city, the city is liable to one who is injured because of the defects, where these have existed for a period of five or six months.
    It is not negligence, as matter of law, for the aunt of a child four years old, with whom the child is staying temporarily, to permit it to go upon the street unattended.
    The fact that the uncle of the child built the defective sidewalk upon which the child is injured, does not affect the right of the child to recover damages from the city for the inj uries which have resulted from such defect.

      Appeal by the defendant, Tbe City of "Watertown, from a judgment of tbe Supreme Court in favor of the plaintiff, entered in the office of the clerk of the' county of Jefferson on the 27th day of May, 1895, upon the verdict of a jury rendered after a trial at the Jefferson Circuit, and also from an order entered in said clerk’s office on the 25th day of May, 1895, denying the defendant’s motion xor a new trial made' upon the minutes.

      Edwa/rd JF. Smith, for the appellant.

      G. S. & H. L. Hooker, for the respondent.
   Merwin, J.:

On October 1,1891, the plaintiff, then being an infant about four years old, fell upon a sidewalk on Grant street, so called, in the city of Watertown, and received an injury, the damages arising from which he seeks in this action to recover of the defendant upon the ground of negligence. It is claimed by the defendant (1) that Grant street, so called, is not a public highway; (2) that if it is the defendant was not negligent, and (3) that plaintiff, or those who had the care of him, were guilty of contributory negligence. All these questions were submitted to the jury, and the verdict was adverse to the defendant.

On the 20th of October, 1886, the common council of the defendant adopted a resolution, a copy of which is as follows:

Resolved, That the following named streets, Grant, Hancock, Tilden, Lincoln and Seward, he and they are hereby accepted as public highways in accordance with the map thereof heretofore filed by D. G. Griffin.”

It appears that prior to the passage of this resolution Mr. Griffin, then being the owner of a tract of land northerly of Main street in the northerly part of the city of Watertown, filed in the office of the clerk of Jefferson county a map or plat of the property laid out in lots with streets in regular form. The streets named in the resolution are those indicated and laid out on the map. Grant street upon the map extended in a direct line northerly from Main street about 1,200 feet. The house, in front of which was the sidewalk in question, was owned by one Morrill, and was built in or prior to 1892 on the easterly side of Grant street about 860 feet from Main street. Beyond it northerly there was no other house on that side of the street. On the other side of the street there were two houses further north. Beyond that on the north there was indication of a street for 150 or 200 feet, and beyond that point there was a fence across the street. Other houses had been built along the street southerly of the Morrill house. In 1893 the city authorities built, in Grant street, a sewer running from Main street northerly about Y00 feet. There was evidence tending to show that for several years before 1893 the street had been open and used as a street by the public generally for walking and driving, and to some extent farther north than Morrill’s.

A public highway may be created by dedication through offer and actual acceptance. (City of Cohoes v. D. & H. C. Co., 134 N. Y. 397.) The question whether a public highway has been so created is ordinarily a question of fact, as it involves the intent and acts of the owner and the alleged acceptor. (Flack v. Village of Green Island, 122 N. Y. 107.) Where a plat is made and recorded, the requisite intention on the part of the owner is generally indisputable. (2 Dillon Mun. Corp. § 636.) The dedication and acceptance may be proved by the acts of the parties and the circumstances of the case. (Cook v. Harris, 61 N. Y. 448.)

In Sewell v. City of Cohoes (75 N. Y. 45), which was an action for negligence in not keeping a street in safe condition, and in which it was claimed by the city that the street had never been legally laid out, and was not a legal highway, it is said (p. 51) r “ Having the power to lay out streets, the omission to do it lawfully does not exonerate the corporation from liability from negligence when its officers assume to hold out to the public that a street is-located within its limits, and they are invited to use it and to travel upon it. Such a rule would compel a traveler to determine for himself whether the street was lawfully laid out, and is not upheld by the case cited or supported by authority. Although the precise, question discussed has never been directly presented in this State,, the authorities are numerous which sustain a contrary view, as will be seen by a reference to the cases. In Mayor v. Sheffield (4 Wall. 189) it is held that where the authorities of a city or town have treated a place as a public street, taking charge of it and regulating it as they do other streets, and the injury occurs by reason of negligence, the corporation cannot, when sued for such injury, defend itself by alleging irregularity in the proceedings or a want of authority in establishing the street. The rule is well settled that the act of the city in assuming authority to control the land as a street, renders it chargeable with the same duties, and imposes upon it the same liabilities as if it had been lawfully laid out, and it is estopped from questioning that it was a lawful road or street. (Houfe v. Town of Fulton, 34 Wis. 608; Stark v. Lancaster, 57 N. H. 88; City of Aurora v. Colshire, 55 Ind. 481; Phelps v. City of Mankato, 23 Minn. 276.) In the last case cited it was held that it was immaterial whether the street became such by formal acceptance and user by the public so far as regards the duty of the city to keep it in safe condition.”

Applying these authorities to the facts of this case, the 'defendant cannot, we think, complain because the question of dedication and acceptance was left to the jury.

But the defendant urges that if Grant street became a highway in 1886, it had ceased to be such before the happeuing of the accident in question, under the statute that provides that every highway that shall not have been opened and worked within six years from the time it shall have been dedicated to the use of the public or laid out, shall cease to be a highway. (Section 99 of the Highway Law [Oliap. 568, Laws of 1890], re-eñacting in substance section 99 of title 1, chapter 16, part 1 of the Revised Statutes [1 R. S. 520], as amended by chapter 311 of the Laws of 1861.) There was evidence that the street in question had been opened beyond the locality in question within six yearsfrom 1886. It was shown to have been worked to some extent by the city authorities in 1894, but whether or not it had been worked before 1894 does not appear, except perhaps by inference from the evidence that it was passable for public travel and had been used by the public for travel within the six years beyond the Morrill premises. As said in Beckwith v. Whalen (70 N. Y. 435): “It must be opened as a highway over its entire route. It need not be worked in every part, but it must be worked sufficiently to be passable for public travel.”

The burden of proof Avas on the defendant to show that the road had not been worked Avithin the six years. (The City of Cohoes v. D. & H. C. Co., supra; Horey v. Village of Haverstraw, 124 N. Y. 273.) That being so, we have, I think, no right to say, as matter of law, that it was not worked within that time.

So that, for aught I see, we must accept the conclusion of the jury that, so far as this case is concerned, there was a public highway at the locality in question.

We then come to the question whether there was sufficient in the case to justify the finding of negligence on the part of the city. It is not claimed that the sidewalk upon which the plaintiff fell was not defective, or that the defect then existing did not cause the injury. The sidewalk was not built by or under the direction of the city authorities and they had no actual notice of the defect, and it is claimed that under the circumstances the city should not be chargeable with constructive notice. The defect had, however, existed for the period of five or six months, and it was a question of fact whether the city authorities, in the exercise of reasonable care, should have discovered the defect and remedied it. “Actual notice to the proper municipal authorities of a defect is not necessary in order to charge it with negligence; they owe to the public the duty of active vigilance, and where a street or sidewalk has been out of repair for any considerable length of time, so that by reasonable diligence they could have notice of the defect, such notice may be imputed to them.” (Pomfrey v. Village of Saratoga Springs, 104 N. Y. 459.) The fact that the sidewalk was constructed without the authority of the city does not change the rule.. (Saulsbury v. Village of Ithaca, 94 N. Y. 27; Seymour v. Village of Salamanca, 137 id. 364.) We are referred by the defendant to the case of Griffin v. Mayor, etc. (9 N. Y. 456), as laying down a different rule on the “subject of notice. So far as that case holds that actual notice is necessary, it must be deemed to have been overruled by the later cases. (See Requa v. The City of Rochester, 45 N. Y. 135.) The question of negligence was, we think, properly submitted to the jury.

The question of contributory negligence on the part of those who had charge of the child is urged with a good deal of earnestness by the learned counsel for the defendant, but we find no good reason for taking the question away from the jury. (Stackus v. N. Y. C. & H. R. R. R. Co., 79 N. Y. 464; Weil v. D. D., E. B. & B. R. R. Co., 119 id. 147, 153.) If the aunt of the child, in whose charge he was upon the day of the injury, permitted him to be on the city street unattended, we cannot say, as matter of law, that she was negligent. (Huerzeler v. C. C. T. R. R. Co., 139 N. Y. 490.) The fact that the uncle of the child, in whose house the childNwas on that day staying .temporarily, built the defective sidewalk, does not deprive the child of any legal remedy he may have against the city.

Our attention is called to a number of exceptions to rulings upon evidence. "We find, however, no sufficient ground for reversal. The directions given by the aunt to the child were competent on the question of contributory negligence. The right of the superintendent of public works to do the work which he did on the street appeared in the progress of the case.

The evidence that one of the members of the common council knew of the locality in question was received conditionally and no motion was afterward made to strike it out. It is not clear that it was of any materiality as the case stood.

Hardin, P. J., and Martin, J., concurred.

Judgment and order affirmed, with costs.


text:
    The People of the State of New York, Appellent, v. Industrial Benefit Association, Respondent.

      Life assurance assessment company — it cannot insure the life of am. infant by a 'yearly policy — plan of assessment insurance.

    It is a general rule in the construction of statutes that when a general intention is expressed, and also a particular intention, incompatible with the general intention, the particular intention is to be considered in the nature of an exception, and as operative.
    The general provision of section 55 of the Insurance Law (Chap. 690 of the Laws of 1892), providing that a person liable for the support of a child of the age of one year and upward may take a yearly renewable term policy of insurance upon the life of such child, does not extend the scope of article 6 of the Insurance Law, which forbids a life insurance company, conducted upon the assessment plan, from issuing such a policy.
    The right to issue such policies is given to corporations which are engaged in a general life insurance business.

      The plan of life insurance, by assessment, proceeds upon the idea that only members of such an association can become its policyholders, and that these should be adults.
    None of the provisions of the Insurance Law, continuing the existence of assessment companies, organized under chapter 175 of the Laws of 1883, justify an assessment life insurance company in insuring the life of an infant.
    L Appeal by the plaintiff, The People of the State of New York, from an order and interlocutory judgment of the Supreme Court in favor of the defendant, entered in the office of the clerk of the county of Onondaga on the 16th day of February, 1895, upon the decision of the court rendered after a trial at the Onondaga Special Term sustaining the defendant’s demurrer to the plaintiff’s complaint.
    The action was brought to restrain the defendant from issuing yearly renewable term policies of insurance upon the lives of infants.
    The demui’rer was interposed upon the ground that the complaint did not state facts sufficient to constitute a cause of action.

      T. E. Ilancoch, Attorney-General, and John W. Hogan, for the appellant.

      Walter 8. MacGregor, for the respondent.
   Merwin, J.:

By the complaint it appears that the defendant is a domestic corporation, organized under and pursuant to chapter 175 of the Laws of 1883, and the several acts supplemental thereto and amendatory thereof, and that the business. carried on by it has been and is life insurance upon the co-operative or assessment plan, under and pursuant to its articles of incorporation and by-laws ; that in its by-laws provision is made for the issuing of policies of insurance, in one branch to persons between seventeen and sixty years; in another to persons between one and seventy years of age, and in another to persons between the age of seventeen and eighty years, and it is pro vided that no other than yearly renewable term policies of insurance will be issued on the lives of persons under eighteen years, of age, and then only upon application of the parent or guardian; that since the 12th day of September, 1891, the defendant has been and still is issuing yearly renewable term policies of insurance upon the lives of infants of tlie age of one year and upward, and under the age of eighteen years, upon application made upon behalf of said infants by persons liable for their support, the application being in the following form : “ I, the undersigned, being liable for the support of--, an infant, and for the purpose of protecting myself against such liability, do, on behalf of said infant, hereby apply for a yearly renewable term policy of insurance in the above association upon its'life; and, for the purpose of securing such a policy in said association for said infant, make the following statements, to wit.” Then came divers questions to be answered, and then a final statement in which was the following clause: And in consideration of the issuance of the policy hereby applied for, I guarantee that said infant shall abide by all the conditions and agreements contained therein, and in the by-laws of said association as they now exist, or may be hereafter enacted; provided that the failure to pay the premiums required by any policy issued hereon shall create no debt against said infant or its estate, but shall only operate to forfeit the policy.” A form of the policies issued was annexed to the complaint.

The plaintiff alleges that the defendant, under its charter and the •■Insurance Law of the State, has no right to issue yearly renewable term policies on -the lives of infants. The defendant claims it has a right to do so under section 55 of the Insurance Law (Chap. 690, Laws of 1892). Whether it has such right is the question involved in this appeal.

Under the act of 1883 (Chap. 175), the defendant had a right to carry on the business of insurance upon the co-operative or assessment plan, and section 5 of that'act defined what should be deemed to be insurance upon that plan. An essential element of it was the issuance of a certificate or policy to, or an agreement with, its members for the payment of money or the rendering of a benefit upon the decease of a member.” So that, apparently, the lives of members only were to be insured, and members only could be policyholders.

In Matter of Globe Mut. Ben. Assn. (135 N. Y. 280) it was held that a corporation, organized under the act of 1883, had no power to receive infants as members, and an order was affirmed which restrained such a corporation from continuing to transact business as far as the insurance of minors was concerned. That order proceeded, as the court said, on the ground that the insurance of infants is not within the powers of corporations organized under this statute, and is inconsistent with the statutory scheme and the legislative intention. Adult persons only were contemplated as entitled to membership.”

The act of 1883 was repealed by the Insurance Law, but it was provided by section 206 of that law, which is a part of article 6, relating to “ life or casualty insurance corporations upon the cooperative or assessment plan,” that any existing domestic corporation transacting insurance business on that plan may continue to exercise all the rights, powers and privileges not inconsistent with this article, pursuant to its articles of association or incorporation, the same as if reincorporated under this article.” And it was provided by section 292 that the provisions of this chapter, so far as they are substantially the same as those of laws existing on September 30,1892, shall be construed as a continuation of such laws, modified or amended, according to the language employed in this chapter, and not as new enactments, and shall be applicable to all corporations formed under laws repealed by this chapter.” So that the life of the defendant was continued subject, however, to the Insurance Law, so far as applicable.

By the 1st section of article 6 above referred to, being section 200 of the Insurance Law, provision is made for the organization of corporations for the purpose of transacting the business of life or casualty insurance upon the co-operative or assessment plan. By section 201 it is provided as follows: Any corporation, association or society which issues any certificate, policy or other evidence of interest to, or makes any jnomise or agreement with its members whereby, upon the decease of a member, any money or other benefit, charity, relief or aid is.to be paid, provided or rendered by such corporation, association or society to his legal representatives, or to the beneficiary designated by him, 'which money, benefit, charity, relief or aid is derived from voluntary donations, or from admission fees, dues or assessments, or any of them, collected or to be collected from the members thereof, or members of a class therein, or interest or accretions thereon, or accumulations thereof, or rebates from amounts payable to beneficiaries or heirs; and wherein the money or other benefit, charity, relief or aid, so realized, is applied to or accumulated for the uses and purposes herein specified, or of such corporation, association or society, and the expenses of the management and prosecution of its business, shall be deemed to be engaged in the business of life insurance upon the co-operative or assessment plan, and shall be subject to the provisions of this article.” It will be observed that by this section, like section 5 of the act of 1883, the business of life insurance upon the co-operative or assessment plan was confined to cases where policies or certificates were issued to, or agreements were made with, “ members ” of the corporation for the rendering of money or other benefit “ upon the decease of a member.”

By section 209 in the same article it is provided that every corporation or organization of this or any other State or country transacting the business of life insurance upon the co-operative or assessment plan, as defined in such article, shall be subject to all the provisions of such article, and not to the provisions of article y2. That article relates generally to life, health and casualty insurance corporations. In section 209 it is also provided that “ all associations, societies, companies, corporations or organizations now transacting or hereafter desiring to transact the business of life or casualty insurance in this State upon any other plan than that defined in and by this article shall comply with all the provisions of the general life and health insurance laws.”

By section 205 of the same article it is provided that any foreign corporation which is authorized by the law under which it is incorporated to issue contracts of insurance not authorized by this article shall not be authorized to transact any business authorized by this article within this State until it files with the Superintendent of Insurance an agreement duly executed by it that it “ will not enter into or issue within the State of New York any contract of insurance, policy or agreement not authorized by this article.”

It seems to be reasonably clear that, taking article 6 by itself, it must be deemed to have been the intention of the Legislature to limit the business of any corporation engaged in life insurance upon the co-operative or assessment plan to that business as defined by section 201. It is practically conceded that under article 6, standing alone, the business here in controversy could -not be done. Section 201 is, so far as this question is concerned, substantially like section 5 of the act of 1883, and the case cited from the Court of Appeals would apply. Does section 55 of the Insurance Law operate to enlarge the scope of the business of such corporations?

Section 55 is part of article 1 of the Insurance Law. That article is headed “ General Provisions.” That section, so far as it is important here, is as follows: “No policy of insurance shall be issued upon any property except upop the application and in the name of. some person having an interest in the property. No policy or agreement for insurance shall be issued upon the life or health of another or against loss by disablement by accident except upon the application of the person insured; but a wife may take a policy of insurance upon the life or health of her husband or against loss by his disablement by accident; an employer may take out a jjoliey of accident insurance covering his employees collectively for the benefit of such as may be injured, and a person liable for the support of a child of the age of one year and upward may take a'yearly renewable term policy of insurance thereon, the amount payable under which may be made to increase with advancing age, and which shall riot exceed the sums specified in the following table, the ages wherein specified being the age at time of death, and which,'after the age of thirteen, may become an ordinary life policy for an amount not exceeding the sum specified in the table.”

The defendant claims the benefit of the general provision that a person liable for the support of a child may take a yearly renewable term policy of insurance uj:>on the life of such child. This is stated in the section as one of the exceptions to the general rule that no policy or agreement for insurance shall be issued except upon the application of the person insured. The whole section taken together applies more naturally to cases within the general life, health and accident insurance laws, and 'this may be said specially of the last clause, inasmuch as the yearly renewable term policy there mentioned may, in a contingency there specified, become an ordinary life policy, such as corporations engaged in the business of life insurance upon the co-operative or assessment plan have no right to issue.

Assuming, as I think we must, that by' article 6 there was a manifest intention to limit that business (co-operative or assessment insurance) to a particular method and scope, the general provisions of section 55, if applied to such corporations, would extend their scope, and so far would be inconsistent with and override the particular provisions of article 6. A case is, therefore, presented for the application of the general rule relative to the construction of statutes, that when a general intention is expressed, and also a particular intention incompatible with the general intention, the particular intention is to be considered in the nature of an exception. (Hoey v. Gilroy, 129 N. Y. 132, 138; Potter’s Dwarris on Statutes, 273; Sedg. on Stat. Const. [2d ed.] 361; 23 Am. & Eng. Ency. of Law, 426; Pretty v. Solly, 26 Beav. 610.) In the case last cited it is said : “ The rule is that, wherever there is a particular enactment and a general enactment in the same statute, and the latter, taken in its most comprehensive sense, would overrule the former, the particular enactment must he operative, and the general enactment must be taken to affect only the other parts of the statute to which it may properly apply.’* Applying this doctrine, the general provision in section 55 would not be deemed to extend the scope of article 6.

Besides, it would seem that the issuing of yearly renewable term policies was outside of any power given by article 6. The provision in section. 55 does not confer the power to issue such policies ; it simply provides that a person in a certain situation may take ” such a policy. The right to issue such policies must be given by some other statutory provision. Undoubtedly, corporations engaged in a general life insurance business have such authority. (3 Kent’s Comm. 365 ; 1 Bacon on Ben. Soc. & Life Ins. § 167.)

We are of the opinion that under the allegations of the complaint, and the law applicable thereto, the defendant is not entitled to the benefit of the general provision in section 55, and that it has not the right to issue yearly renewable term policies of insurance upon the lives of infants.

The judgment, must, therefore, be reversed.

Hardin, P. J., and Martin, J., concurred.

Interlocutory judgment reversed, with costs, and the demurrer overruled, with costs, with leave to defendant to answer in the usual time upon payment of the costs of the demurrer and of the appeal.


text:
    In the Matter of the Application for Letters of Administration, etc., of Larned K. Wilson, Jr., Deceased. Larned K. Wilson, Appellant; Emma E. Wilson, Respondent.

      Executor and administrator — a release by a wife, in an agreement of separation, of all her rights in her husband’s property does not affect her right to administer upon his property.

    Upon an appeal from an order and decree of a Surrogate’s Court, awarding letters of administration to the wife of a decedent, it appeared that she had made an agreement of separation with her husband, by which, in consideration of a certain payment made by her husband to a trustee for her benefit, she accepted the money in satisfaction of her right of dower, of her distributive share in his present or future personal property,.and of her statutory exemptions as widow, and thereby released all claims for dower or any other interest in his property. This instrument contained no allusion to or promise concerning a renunciation of her statutory right to administer upon his estate.

      Held, that, within the meaning of section 2660 of the Code of Civil Procedure, she was the person who, in case of the intestacy of her husband, was “ entitled to succeed to his personal property ; ”
    That the agreement made between herself and her husband did not constitute a renunciation effective under section 2663 of the Code of Civil Procedure, and that, as she was not disqualified under section 2661 of the Code, she was entitled to the priority given by the statute to a widow.
    Appeal by Larned K. Wilson from an order and decree of tbe Surrogate’s Court of tbe county of Oneida, entered in said Surro- ‘ gate’s Court on tbe 7th day of May, 1895, awarding to Emma E. Wilson letters of administration upon tbe personal estate of Larned K. Wilson, Jr., deceased.
    By tbe terms of an agreement of separation entered into between Larned 3L Wilson, Jr., party of the first part; Emma E. Wilson, bis wife, party of the second part, and Berton E. Sayles, party of tbe third part, it was, among other things, provided that “ the said Larned K. Wilson, Jr., shall and will well and truly pay, or .cause to be paid, unto tbe said trustees above named, for said Emma, bis wife, tbe sum of thirteen hundred ($1,300.00) dollars in cash at the time of tbe execution and delivery of these presents, which said sum of thirteen hundred dollars so hereby made payable, and so paid to said trustee for the said Emma E. Wilson, in manner aforesaid, she, the said Emma E. Wilson, doth hereby agree to accept and take in full satisfaction of her support and maintenance, and all alimony whatsoever, during her coverture and during her life, and also as and for and in full payment and satisfaction of 'and for her dower interest and rights of dower in all real estate which he, the said Lamed K. "Wilson, Jr., now has and owns, and also in all real estate which he shall or may or does hereafter acquire or own, and as and for and in full payment and satisfaction of and for her distributive portion of all his personal property which he now has or possesses, or which he shall, may or does hereafter acquire, own or possess, and in full satisfaction and payment of all statutory exemptions given or provided by law for widows, to which she might at any time be entitled to, from and out of the estate of her said husband, the said Earned K. "Wilson, Jr.
    “ And it is further covenanted and agreed, by and between said parties hereto, that in consideration of said payment of said money to her, said Emma, as aforesaid, and the covenants and agreements therein contained, she, the said Emma, shall absent herself continuously from and not visit the house of said Earned K. "Wilson, Jr., or communicate with him, or molest him, or make any claim upon or against him, in any manner, for her support or maintenance during her life or during his life, or against his estate after his death, either for dower in his real estate or distributive portion of personal property for widows’ exemptions, or anything else, and will, upon request of any person interested in the same, after his death execute to and deliver to them release of her dower or other claim or interest in the estate of said Earned K. Wilson, Jr., and the said Emma E. Wilson does hereby release all claim of dower or other interest in any property and in all property now owned by said Earned K. Wilson, Jr., or which he may or shall hereafter own or possess, and that she will, upon request of her said husband, or any other person interested therein, at any time hereafter, sign and execute with him any deed or deeds of any property which he shall own or wish to convey, and that she shall and will make no claim to dower or other interest in or to any property, real or personal which he, said Earned K. Wilson, Jr., shall ever own or possess.”

      W. B. Bliss, for the appellant.

      Scvyles, Searle ds Sayles, for the respondent.
   Mekwin, J.:

The question on this appeal is whether the respondent, as the surviving wife of the decedent, is entitled to letters of administration upon his estate. It is practically conceded that she is entitled unless she is disqualified by reason of the effect to be given to the provisions of an agreement of separation made between the respondent and her husband and a trustee on the 14th of September, 1894. By this agreement the respondent, in consideration of the payment of a certain sum of money to the trustee for her, in substance, agreed to receive the same in satisfaction of any right of dower she then had or might thereafter have in any real estate of her husband, and in full payment and satisfaction of and for her distributive portion of all his personal property which he then had or might thereafter acquire, and in full satisfaction and payment of all statutory exemptions given by law to widows, to which she might at any time be entitled to from his estate, and she thereby released all claims of dower or other interest in any of his property then or thereafter to be owned by him, and agreed that she would make no claim of dower or other interest in it.

The argument of the appellant is that the respondent is not' entitled to share in the distribution of the personal property, and is, therefore, not entitled to administer as against the appellant, who is the father of the decedent and his next of kin. The ground taken by the appellant in his petition to the Surrogate’s Court is “ that the said widow, Emma Wilson, has, by an instrument in writing, released and assigned all of her right, title and interest in the real and personal property of said deceased.”

By the Revised Statuses (Part 2, chap. 6, tit. 2, § 27) it was provided as follows:

Administration, in case of intestacy, shall be granted to the relatives of the deceased who would be entitled to succeed to his personal estate, if they or any of them will accept the same, in the following order: First, to the widow; second, to the children ; third, to the father; fourth, to the brothers; fifth, to the sisters ; sixth, to the grandchildren ; seventh, to any other of the next of kin who would be entitled to share in the distribution of the estate. If any of the persons so entitled be minors administration shall be granted to their guardians ; if none of the said relatives or guardians will accept the same, then to the creditors of. the deceased, and the creditor first applying, if otherwise competent, shall be entitled to a preference; if no creditor apply, then to any other person or persons legally competent.”

Under this statute it was held in Lathrop v. Smith (24 N. Y. 417) that it was not essential to the right of administration that the person administering should stand in a position to take a share or portion of the decedent’s personal estate; that when the father, who was entitled to the personal estate, had renounced, the brother was entitled to administration before a creditor, although the brother had no interest in the estate. Apparently the order of preference stated in detail was deemed to control the expression, “ who would be entitled to succeed.”

The statute upon this subject now in force is section 2660 of the Code of Civil Procedure, which reads, so far as the question here is concerned, as follows:

“ Administration, in case of intestacy, must be granted to the reía- ’ tives of the deceased entitled to succeed, to his personal property who will accept the same in the following order : (1) To the surviving husband or wife; (2) to the children; (3) to the father; (4) to the mother; (5) to the brothers ; (6) to the sisters; (7) to the grandchildren ; (8) to any other next of kin entitled to share in the distribution of the estate; (9) to an executor or administrator of a sole legatee named in a will whereby the whole estate is devised to such deceased sole legatee.

“ If a person entitled is a minor administration must be granted to his guardian, if competent, in preference to creditors or other persons. If no relative, or guardian of a minor relative, will accept the same, the letters must be granted to the creditors of the deceased, the creditor first applying, if otherwise competent, to be entitled to í» 55 ' preierence.

It will "be observed that the expression in the Revised Statutes, “ who would be entitled to succeed to Iris personal estate,” is changed to “ entitled to succeed to his personal property.” It is argued that this change does away with the effect of the decision in the Lathrop case. That, however, does not clearly appear. On the contrary, the reasoning of the Lathrop. case would practically apply with as much force to the present section as to the former one. In effect the two clauses of the section were deemed to be inconsistent, and the latter clause being specific was deemed to be controlling. (See Redi. Suit. Courts [5th ed.], 290.)

It is to be observed that section 27 of the Revised Statutes, above referred to, was amended by section 3 of chapter 362 of the Laws of 1863, by adding thereto the following: This section shall not bo construed to authorize the granting of letters to any relative not entitled to succeed (to) the personal estate of the deceased as his next of kin at the time of his decease.” The section was again amended by section 6 of chapter 782 of 1867, and the words added by the amendment of 1863 wei-e left out. Nor do they appear in the Code. The amendment of 1863 indicated a legislative intention to override the doctrine of the Lathrop case, and the repeal of that amendment indicated an intention to leave the law as the Lathrop case put it.

The right of administration, as- given to the surviving wife, was a personal one. She was, by the law, one of those entitled to succeed to the personal property. The appellant claims that she had in effect renounced her right, or disqualified herself by the agreement with her husband. There was no renunciation effective under section 2663 of the Code. If there had been there was a right of retraction. (Casey v. Gardiner, 4 Brad. 13.) Nor was the respondent disqualified under section 2661. It has been held that the withholding of letters from a person who, if not by some cause incapacitated, would be entitled to priority, under the statute, is never justifiable, save in cases where such person is declared to be disqualified by the statute itself. (Coope v. Lowerre, 1 Barb. Ch. Rep. 46; O'Brien v. Neubert, 3 Dem. 156.)

It is not clear that the appellant in this proceeding had the right to call on the Surrogate’s Court for a construction and enforcement of the agreement. But if that could bé done, and it be assumed that under the agreement the respondent had no right to a distributive share of the estate, still I am inclined to the opinion that under the Lathrojp case, there being no effective renunciation, the respondent was entitled to letters.

The decree or order appealed from should be affirmed.

ITardin, P. L, and Martin, J., concurred.

Decree affirmed, with costs.


author: Per Curiam :

text:
    William G. Milligan, as Sole Surviving Administrator, With the Will Annexed, of Catharine M. Lansing, Deceased, and John Lansing, as Executor, etc., of Robert Lansing, Deceased, Respondents, v. Octavius O. Cottle and Albert E. Chapin, Appellants.

      Is ótica of entry of an order dismissing an appeal — when sufficient to sustain an action upon an undertaking on the appeal.

    The requirements of section 1809 of the Code of Civil Procedure, as it stood in. 1894, that an action upon an undertaking ¿Ivon upon appeal shall not be maintained “until ten days have expired since the service upon the attorney for the appellant of a written notice of the entry of a judgment or order affirming the judgment or order appealed from, or dismissing the appeal,” are fully satisfied when the attorney for the respondent serves a copy of the order dismissing the appeal upon the attorney for the appellant, which is signed by the •county clerk and indorsed as filed and entered upon a day stated, although no specific notice signed by the attorney for the respondent that the order had been entered was served upon the appellant’s attorney.
    Appeal by the defendants, Octavius O. Cottle and another, from a judgment of the Supreme Court in favor of the plaintiffs, entered in the office of the clerk of the county of Jefferson on the 18th day of January, 1895, upon the decision of the court rendered after a trial at the Jefferson Special Term.
    This action was commenced on the 24th day of July, 1894, to recover upon an undertaking given in December, 1815, by the defendants Cottle and Chapin and one Peter McEwen, on appeal to the General Term of this court from a judgment of the Special Term, dismissing the complaint, with costs, in an action wherein Moses Petrie, as surviving executor, etc., of David Petrie, deceased, and Fannie P. Cottle, as administratrix, etc., of Joram Petrie, deceased, were plaintiffs, and William G. Milligan and Jane G. Dann, as administrators, etc., of Catharine M. Lansing, deceased, and Robert Lansing were defendants.
    In November, 1893, the General Term dismissed the appeal. On the 19th day of December, 1893, a certified copy of the order dismissing the appeal, which was filed on the back, “ Supreme Court. Fannie P. Cottle, as administratrix & ano. v. William G. Milligan, as administrator, etc., & ano. Copy order. C. J. Palmer, survivor of Burrows & Palmer, attorney for W. G. Milligan. Herkimer Co. Clerk’s Office. Piled and entered Dec. ISt-li, 1893. D. M. Richardson, Hep. Clerk,” was served on C. C. Cottle, the attorney for the appellants in the action in which the appeal was taken. The appellants’ attorney, who is one of the defendants in this action, admitted service of such copy of the order by writing on the back of such copy '‘Service of a copy of this order admitted Dec. 19, 1893. C. 0. Cottle, atty., etc.”
    Peter McEwen, one of the signers of the undertaking, died before the commencement of this action. Jane G. Dann, one of the defendants in the action in which the appeal was brought, died before the commencement of this action, leaving William G. Milligan as sole surviving administrator, with the will annexed, of Catharine M. Lansing. Robert Lansing, one of the defendants in said action in which the appeal was brought, died before this action was commenced, leaving a will appointing John Lansing executor, to whom letters testamentary were issued.
    The trial court held that the service of the certified copy of the order dismissing the appeal, with the indorsement thereon, was a substantial compliance with the requirements of the statute that written notice of the entry of the order should be served on the appellants’ attorney before an action on the undertaking could be maintained, and ordered judgment that William G. Milligan, as administrator, etc., recover $177.86, and John Lansing, as executor, etc., recover $519.77, on which judgment was duly entered, from which the appeal is taken.

      Edmund P. Gottle, for the appellants.

      Lansing & Lmising, for the respondents.
   Per Curiam :

On the 16th of October, 1875, in an action in the Supreme Court wherein Moses Petrie, executor, etc., of David Petrie, deceased, and Fannie P. Cottle, administratrix, etc., of Joram Petrie, deceased, Were plaintiffs, and William G. Milligan and Jane G. Dann, administrators, etc., with the will annexed of Catharine M. Lansing, deceased, and Robert Lansing were defendants, a judgment was entered and docketed in the office of the clerk of Herkimer county, whereby the complaint of the plaintiffs therein was dismissed, and the said Robert Lansing recovered of the plaintiffs therein the sum of §250.35 costs, and the said Milligan and Dann recovered of the jilaintiffs therein the sum of $81.01 costs. The plaintiffs in that action thereupon appealed to the General Term, and, in order to stay execution on the judgment, the defendants in the present action, and one McEwen, on the 29th of December, 1875, duly executed an undertaking that the appellants on that appeal would pay all costs and damages that might be awarded against them on the appeal, not exceeding $500, and also that, if the judgment appealed from, or any part thereof, should be affirmed, or the appeal be dismissed, the appellants would pay the amount directed to be paid by the said judgment or the part of such amount as to which the said judgment should be affirmed, if it should be affirmed only in part, and all damages which should be awarded against the appellants on the appeal.

Thereafter, proceedings were taken toward the making and settlement of a case, and before it was finally settled, and on or about January 1, 187S, Moses Petrie died. Nothing further was done on the appeal until April, 1893, when proceedings were commenced by Milligan, as surviving administrator of Catharine M. Lansing, deceased, to procure a dismissal of the appeal. This resulted in an order made by the General Term on the 28th of November, 1893, “ that 'the appeal in this action be, and the same is hereby dismissed, without costs of appeal to either party thereto, and without costs of this motion to either party.” Robert Lansing, one of the defendants when the appeal was taken, died on the 4th of October, 1878, and on the 10th of October, 1878, his will was duly proved and letters testamentary issued to John Lansing, executor therein named.

The present action is brought by Milligan as surviving administrator, etc., of Catharine M. Lansing, deceased, and by John Lansing as executor, etc., of Robert Lansing, deceased, to recover on the undertaking the amounts awarded in the judgment appealed from to Milligan and Dann as administrators, etc., and to Robert Lansing. It is claimed by the defendants that the appeal has not been dismissed as to Robert Lansing or the party representing his estate. The order of dismissal was made upon notice to all parties interested whether parties to the suit or not. The executor of Robert Lansing was notified and appeared on the motion and was interested in having a dismissal.

The action was brought by creditors of Frederick Lansing, deceased, of whose estate Robert Lansing was executor and it ■vyas claimed that Robert Lansing and Catharine M. Lansing held certain lands as trustees for the benefit of creditors of Frederick Lansing. The order to show cause upon which the motion was brought on was for a dismissal generally, and so was the order of dismissal. We must, we think, assume that the court intended an entire dismissal of the appeal. The question of laches ivas in the proceeding as well as the right of a party under the provisions of section 1298 of the' Code of Civil Procedure. Without doubt the court had jurisdiction to make the order.

The main question on this appeal arises on the claim of the defendants that the plaintiffs did not before they commenced this suit give the notice required by section 1309 of the Code of Civil Procedure. By that section, as it stood in 1891, when this action was commenced, it was provided that an action upon an undertaking like the one here involved shall not be maintained “ until ten days have expired since the service upon the attorney for the appellant of a written, notice of the entry of a judgment or order affirming the judgment or order appealed from or dismissing the appeal.”

The order of dismissal was duly filed and entered on December 18, 1893, and it is found that on the 19th of December, 1893, a certified copy of the order was served on O. 0. Cottle, attorney for the appellants on the appeal. The copy order so served was indorsed on the back as follows: “ Supreme Court. Fannie P. Cottle, as administratrix, & ano., v. William G. Milligan, as administrator, etc., & ano. Copy order. C. L Palmer, survivor of Burrows & Palmer, attorney for W. G. Milligan. Herkimer Co. Clerk’s Office. Filed and entered Dec. 18th, 1893. D. M. Richardson, Dep. Clerk.” Service of a copy of the order so indorsed was admitted in the following form : “ Service of a copy of this order admitted Dec. 19, 1893. 0. O. Cottle, atty., &c.” Mr. Cottle appeared for the plaintiffs therein on the motion to dismiss.

The argument on the part of the appellants is addressed chiefly to the proposition that there was no sufficient notice of entry of the order. There was no specific notice signed by the attorney that the order had been entered, but tlie order as served bore a certificate of tlie clerk that it bad been filed and entered. It was also indorsed by the attorney, so that it was in effect a notice from the attorney that the order had been entered. Written information was conveyed that fully answered all the requirements of the statute. We are referred to numerous cases involving the construction of notices given for the purpose of limiting the time to appeal. In such cases it is said that the notice must he regular in every respect and the party must he held to strict practice. This rule does not apply to cases like the present, and that very clearly was the view taken by the court in Evans v. Backer (101 N. Y. 289, 292). A notice quite similar to the one here was held, in Baker v. Hatfield (3 Civ. Proc. Rep. 303), by the General Term in tlie second department to he sufficient even to limit the time to appeal.

We are inclined to the opinion that a sufficient written notice of the entry of the order was given, and that it inured to the benefit of both the present plaintiffs. No other question needs to be specially considered.

The judgment should, we think, be affirmed.

Present — Martin and Merwin, JJ.

Judgment affirmed, witli costs.


author: Merwin, J. :

text:
    Salt Springs National Bank of Syracuse, Respondent, v. John C. Fancher and Others, Appellants.

      Fraudulent conveyance — testimony of the fraudulent grantor in supplementary proceedings — grantees with knowledge of the fraud are chargeable with moneys borrowed on mortgage upon, and with the rental value of, the land.

    Upon tlie trial of an action brought by a judgment creditor of one John C. Fancher to set aside a conveyance of real estate made by him to his sons, upon the ground that it was fraudulent as to creditors, the plaintiff introduced in evidence, for the purpose of contradicting the oral evidence given by Fancher, the deposition of Fancher taken in-proceedings supplementary to execution, upon the plaintiff’s judgment.

      Held, that the testimony was admissible;

      That by its introduction the plaintiff had not made Fancher its own witness, and that, therefore, the rule that a party cannot impeach his own witness was not violated.
    It appeared that after Fancher had conveyed the premises in question to his sons, they mortgaged the premises to a bona fide mortgagee, received the money and spent it, and that after the conveyance to them by their father the sons had the use of the real estate.

      Held, that they were properly chargeable with the sum which they had received as the proceeds of the mortgage, and also with the rental value of the property, irrespective of the question whether they had received, during the time of their occupation, any rents or profits.
    .Appeal by tlie defendants, Jolm C. Fancher and others, from a judgment of tlie Supreme Court in favor of the plaintiff, entered in tlie office of the clerk of the county of Onondaga on the 20th day of November, 1894, upon the decision of tlie court rendered after a trial at the Onondaga Special Term, setting aside as fraudulent as against creditors a conveyance and bill of sale from the defendant John C. Fancher to tlie defendants Wardwell W. Fancher and Charles IT. Fancher.
    Also, an appeal by the defendants, Charles TI. Fancher and Ward-well W. Fancher, from an order made at the Oswego Special Term and entered in the office of the clerk of Onondaga county on the 3d day of January, 1895, confirming the-report of the referee upon a reference directed by the judgment.

      W. J. Bellen, for the appellants.

      J. William Wilson, for the respondent.
   Merwin, J. :

The plaintiff, as a judgment creditor of tlie defendant John 0. Fancher, upon a liability incurred by Fancher prior to the 24th day of June, 1892, sought to set aside as fraudulent as against creditors a conveyance of certain real estate dated June 24, 1892, and a bill of sale of certain personal property dated July 12, 1892, made by the said John C. Fancher to the defendants Wardwell W. Fancher and Charles II. Fancher. These instruments covered substantially all the property the debtor then had. Wardwell and Charles are sons of the debtor, and their main defense is that their father owed them for services more than the value of the property. It was found by the Special Term as matter of fact that these instruments and each of them were made and accepted with intent to hinder, delay and defraud the creditors of John C. Rancher, and were, therefore, void as to the plaintiff and its debt. In the light of the arguments presented on the part of the defendants, we have carefully examined the evidence and have reached the conclusion •that the evidence is sufficient to sustain the finding of the Special Term.

The defendants claim that the rule that a party cannot impeach his own witness was violated at the trial. This claim is based on the idea that the plaintiff by introducing in evidence the deposition of John 0. Rancher taken in proceedings supplementary to execution made him its own witness, so that it could not contradict him by showing the facts to be different from what he stated in his deposition. The plaintiff did not call him as a witness, as in the case of Thalheimer v. Klapetzy (12 N. Y. Supp. 942), but simply put in evidence as against himself his sworn declarations. He was after-wards called by the defendants as a witness, and the plaintiff then had a right to cross-examine him and prove b}7 him any facts pertinent to the issue. We find no error in allowing that course to be taken, or that there was any violation of the rule referred to.

Our attention is called to some other exceptions, but we find in them no sufficient ground for reversal. The judgment should be affirmed.

In the course of the trial it appeared that the defendants Ward- ■ well W. and Charles IL, after the conveyance to them and on the 12th of September, 1892, gave a mortgage on the real estate to one Hawley for the sum of $1,000 then loaned to them by Hawley, and applied the money to their own use. It was conceded that Hawley took the mortgage in good faith. This suit was commenced on October 14, 1892. It also appeared that Wardwell and Charles had the use of the real estate from the time of the deed to them. By the judgment a receiver was appointed of the personal property and of the rents and profits of the real estate and of the proceeds of the mortgage above referred to, and the defendants Wardwell and diaries were directed to deliver and pay the same to him, and a referee was appointed to examine into the acts of the said defendants in regard to the real and personal property while they claimed to own the same, and to take an account of tlie rents and profits of the real estate and the proceeds of the said mortgage, and report the evidence by him taken and his opinion thereon. The reference provided was had, and upon the coming in of tlie report it was after due hearing confirmed. The defendants Charles II. and Ward well W. Fancher appeal from the order of confirmation.

The referee reported that the said defendants should be charged with $1,000, the proceeds of the mortgage, and for the use of the real estate from the time of the deed to the time of the judgment or hearing before the referee the sum of $300, in all $1,300.

The appellants claim that they should not be charged with the $1,000 received on the mortgage, mainly because it was not actually in their hands when the present suit wras commenced. They had applied it to their own use. • In this way they would get the benefit of a fraud in which it was found that they had participated. This would hardly answer. They were, we think, properly charged with the amount. (Fullerton v. Viall, 42 How. Pr. 294; Loos v. Wilkinson, 110 N. Y. 214.) They were not charged with interest. The judgments of plaintiff wrere recovered before the mortgage was given.

The appellants claim they should not be charged with the rents and profits, because they did not actually receive any. They were charged with the rental value, the amount of which was not disputed. They actually had the use of the property. That was conceded. That being so, it is difficult to see in principle why they should not account for the use as much as if they had rented to a tenant and received from him rent. In Bump on Fraudulent Conveyances (2d ed., p. 593) it is said: “ It certainly is not consonant with the principles of the law that the grantee should derive any advantage from his fraud. Consequently, he may be compelled to-account for the profits from the time of tlie transfer-.” Many cases are cited to the proposition.

No good reason is presented for disturbing the order. No question was made at the hearing about taxes or repairs.

Hardin, P. J., and Martin, J., concurred.

Judgment affirmed, with costs. Order affirmed, with ten dollars costs and disbursements.


text:
    William E. Pratt, as Receiver, etc., of John Schaefer, Appellant, v. Charles H. Baker and Others, Respondents.

      Sot air furnace put in a house as a permanent improveme?it— it passes as pa/i't of the realty to a purchaser on the foreclosure of a mortgage on the realty.

    A hot air furnace, put in a dwelling house as a permanent improvement and1 designed to heat various rooms on different floors, although susceptible of being taken down and put into another house of equal size, is, as between mortgagor and mortgagee, to be deemed a fixture attached to the realty.
    Appeal by the plaintiff, William E. Pratt, as receiver, etc., of John Schaefer, from a judgment of the Onondaga County Court, in favor of the defendants, entered in the office of the clerk of Onondaga county on the 13th day of April, 1894, reversing a judgment rendered by a justice of the peace of the city of Syracuse.

      II. E. Miller, for-the appellant.

      Walter 8. MacGregor, for the respondents.
   Merwin, J.:

The-subject of this action is a “No. 9 Howard Warm Air Furnace,” placed by Mr. and Mrs. John Schaefer, or by their direction,, in the cellar of a brick dwelling house on Henry street, in the city of Syracuse, in the spring or summer of 1891. In November, 1891,. Mr. and Mrs. Schaefer executed to the defendants, or one of them,, a mortgage on the premises. This was afterwards foreclosed, and ■upon the judgment of foreclosure a sale was made by the sheriff, and the property bid in by the defendants, Baker and Plumb, to--whom a deed was given by the sheriff on or about October 15,1892, and they went into possession. The mortgage and deed were put in evidence before the justice, and although they are not attached to the printed record before us a description sufficiently definite appears:

By an order dated the 3d day of October, 1892-, and recorded October 11, 1892, in proceedings supplementary to execution, the ■ plaintiff was appointed receiver of the property and effects of John Schaefer. On November 4, 1892, Mrs. Schaefer assigned to-the plaintiff, as receiver, all her interest in the furnace. On the 8th of April, 1893, the plaintiff, after a demand,, brought this action in replevin to recover the furnace, or its value, in case delivery could not be had. lie recovered before the justice, but the judgment was reversed by the County Court. The county judge was of the opinion that the furnace was a fixture and part of the real estate.

The claim of the plaintiff is that the furnace is personal property and did not pass by the mortgage and deed on foreclosure to the defendants.

The furnace was put into the house by the Howard Furnace Company under a written agreement dated April 1, 1891, between the company as party of the first part, and Mr. and Mrs. John ■Schaefer as party of the second part. By this agreement the company agreed “ to put into the dwelling (brick), No — Henry street, for second party, one No. 9 Howard Warm Air Furnace (with double casing, brush for cleaning and all attachments complete), and warm air pipes, registers and other connections necessary to heat the following rooms: First floor, hall, two parlors and dining room; second floor, chambers over parlor, sitting room, dining room and kitchen. Three upright pipes. All registers and cold air faces to be black japanned, of Tuttle & Bailey make, and shall be placed, one in each of the above-named rooms. The furnace to be provided with the Howard nickel-plated damper regulator, for regulating the drafts from the first floor. The furnace shall be connected with two wooden cold-air boxes, one from hall and one from dining room. The necessary lumber shall be furnished and boxes built by second party. All necessary carpenter and mason work to be done by second party.” The company guaranteed “that under proper care the furnace shall heat to JO degrees (Fall.) in zero weather the rooms connected with said furnace.” The price wTas $140.

A witness on the part of the defendants testified as follows: “ The furnace is located in about the center of the cellar with two hot-air pipes attached. The hot-air pipes are attached to the furnace by collars on the furnace and the pipes run up through the building. There is a smoke pipe attached to the furnace which .goes into the chimney. The base of the furnace is set in cement with one or two inches of cement close up around the furnace. The furnace has been used in the house since it was put in and has been used for heating the house about two years.”

A witness on the part of plaintiff testified as follows : This is a, hot-air furnace. It can be taken down [obj.] and moved the same as a large stove? [Obj. overruled.] A. Yes. Q. It is suitable in one house as well as another, the house being of equal size ? [Obj.] A. Yes. The inside of this furnace is of cast iron covered on the outside with galvanized iron double cased. The jacket is circular and about 48-J inches in diameter and stands 52 inches high. I took the men to the house in question and had them lay a brick foundation. A circle of bricks a little greater than the diameter of the jacket, one row of bricks in the foundation. The mortar is then put around the base ring, which is laid on top of the brick foundation. The base ring is separate from the furnace and the furnace stands upon it. After the brick work the top of the brick was about two inches above the surface of the cellar. As I recollect the cellar was not grouted when I put in the furnace. "When the base ring is placed the remaining sections of the furnace are put on one above the other and the jacket put on over all. The hot-air pipes are simply connected with the jacket. There is a galvanized iron collar on to which the pipe is dovetailed. The elbows slip over tlm collar without being soldered. The elbows may be slipped off and the furnace removed and another furnace, taking off the ];>ipe at the side, substituted if desired. There was a little mortar on each side of the base ring when I left it, enough to keep out the air.”

The defendants are in possession, and claim the furnace under the mortgage given by the parties the plaintiff represents. The defendants are, therefore, entitled to the benefit of the law on the subject of fixtures applicable to the case of mortgagor and mortgagee.

As between vendor and vendee and mortgagor and mortgagee, the rule is laid down that if the owner of lands provides anything of a permanent nature fitted for and actually applied to use upon the premises by annexing the same, it becomes a part of the realty, though it might be removed without injury to the premises. (1 Washb. on Real Prop. [4th ed.] 22; Voorhees v. McGinnis, 48 N. Y. 278, 282.) In McRea v. Central Nat. Bank (66 id. 489) it is said that if the article is attached for temporary use with the intention of removing it, a mortgagee cannot interfere with its removal by the mortgagor, but if attached for the permanent improvement of the freehold he may. In Buckley v. Buckley (11 Barb. 43, 63) it is said by Judge Hand: “The rule in this State, as between grantor and grantee, vendor and vendee, mortgagor and mortgagee, and heir and personal representative of the deceased, still is, that whatever is annexed or affixed to the freehold, by being let into the soil or annexed to it, or to some erection upon it, to be habitually used there, particularly, if for the purpose of enjoying the realty or some profit therefrom, is a part of the freehold.” In Ewell on Fixtures (p. 275) it is said, the general rule undoubtedly is that all fixtures, whether actually or constructively annexed to the realty, pass by a conveyance or mortgage of the freehold where there is nothing to indicate a contrary intention. The intention is sometimes presumed, or it may be inferred from circumstances. (Matter of Eureka Mower Co., 86 Hun, 309, 312.)

In the present case neither Mr. nor Mrs. Schaefer were sworn as witnesses. Having in view the very apparent object and purpose of putting in this furnace, as particularly indicated by the contract under which it was put in, and by the manner in which it was put in as testified to by one of the plaintiff’s witnesses, it is very clear that it was put in for a permanent improvement, and so remained until the Schaefers left the property in October, 1892, and was there undisturbed when the defendants took possession under their deed. The fact that the furnace might be taken to pieces and put up in-some other house of equal size, does not change the effect of the situation. A great many articles undoubtedly fixtures could be treated in that way. The appellant suggests that it was not shown that the Schaefers owned the property in the spring of 1891. They were in possession, acting as owners, and as such gave the mortgage. The plaintiff cannot complain if the defendants are deemed to have the rights of mortgagees.

The appellant further suggests that the intent of the Schaefers was a question of fact, and that the presumed finding of the justice on that subject should be deemed to be conclusive. The answer to that is that all the material facts and circumstances on the subject of the intent are undisputed, and they do not warrant the conclusion that the furnace was put in as a -temporary structure, or for temporary use, or with the intention of removing it.

We are of the opinion that the furnace should be deemed, as against the plaintiff, a part of the realty.

Hardin, P. J., and Martin, J., concurred.

Judgment affirmed, with costs.