author: Brady, J.:

text:
    ORLANDO B. HASTINGS and FRANCIS TODD, Appellants, v. THE GILES LITHOGRAPHIC COMPANY, Respondent.

      Action to recover damages resulting from a slandering of the plaintiff’s right to publish and sell lithographs for advertising purposes, by a person claiming to have the exclusive right to do so — the falsity of such claim and malice in its assertion must be proved.

    In an action, brought against a domestic corporation, the complaint alleged that in the course of their trade the plaintiffs were applied to by various merchants to publish and sell to them two novel and popular lithographs to be used in their respective trades as advertising cards; that the defendant, which was also engaged in the lithographic business, knowing the premises, willfully and maliciously, and with the declared object of injuring the plaintiffs and destroying their business, caused letters to be written to the customers of the plaintiffs threatening them with legal proceedings if the said lithographs were used, and spread the report that the defendant alone had the right to produce the lithographs in question.

      Held, that the plaintiffs were bound to prove that the claim made by the defendant, that it alone had the right to produce the lithographs in question, was maliciously made.

      Steward v. Young (L. R., 5 C. P., 126); Kendall v. Stone (5 N. Y., 14); Hovey v. The Rubber Tip Pencil Company (57 id., 119); Celluloid Manufacturing Company v. Goodyear (13 Blatch., 375); Burnett v. Tak (45 L. T. [N. S.], 743) followed.
    That, as it was conceded on the trial that the defendant had, what was claimed by it to be, an exclusive license, that the first requisite of the plaintiffs' cause of action was wanting.
    That, as the evidence showed that the defendant believed in its ownership of a license, and proceeded to enforce its rights by the employment of competent counsel, who, after an examination of the subject, wrote a letter to the plaintiffs, notifying them of the defendant’s rights, and forbidding the plaintiffs to use or dispose of the lithographs, and advised the adoption by the defendant of the course pursued by it, and as the manner in which the defendant sought to protect itself was cautious, and, under all the circumstances, could not create any other impression than that it was doing what a careful business man would do to protect his interests, and as the right to give such notices had been recognized and declared to be a duty in the protection of a patent, that the maintenance and assertion of its rights could not be construed to be malicious.

      Halsey v. Brotherhood (L. R., 15 Ch. Div., 514; affirmed 19 id., 386) followed.
    That as the plaintiffs failed to show their superior ownership of, and right to use the lithographs, or the falsity of the defendant’s claim to them, or malice in its assertion of its right to do so, the court did not err in refusing to leave the question of malice to the jury.
    Appeal by the plaintiffs from a judgment ordered by the court, upon the trial of this action at the New York Circuit, dismissing the complaint upon the merits, which was entered in the office of the clerk of the city and county of New York on November 10, 1887.
    The action was brought to recover for damages to the plaintiff’s business.
    The complaint alleged that the plaintiffs were extensively engaged as jobbers in card-board and cut-boards and that the defendant was a domestic corporation.
    That in the course of their trade the plaintiffs were applied to by various merchants to publish and sell to them certain cards to be used in their respective trades as advertising cards; that the orders given by said merchants, being orders for two novel and popular lithographs, would have been highly profitable to the plaintiffs but for the defendant’s wrongful interference.

      That the defendant, which was also engaged in the lithographic business, knowing the premises, willfully and maliciously, and with the declared object of injuring the plaintiffs and destroying their business, caused letters to be written to the said customers of the plaintiffs threatening them with legal proceedings if the said lithographs were used, and spread the report as widely as possible that the defendant alone had. the right to produce the lithographs in •question.
    A motion to dismiss the complaint was made at the end of plaintiffs’ case and was granted.
    The plaintiffs’ evidence established the following facts :
    That about March, 1885, the plaintiffs received a letter from a customer in Chicago, named Clarke, inclosing one of a set of two lithographic cards, made by the defendant, and requesting the plaintiffs to see the defendant and make a bargain with it for 150,000 or 200,000 of the two designs. The card inclosed was merely a' sample, or what is called in the printing trade a draft. The one card represented the head of a little girl in a Mother Hubbard cap, and the other card represented the head of a little boy in • a Turkish fez. The first card was called “Alberta ” and the other “Little Turk.” These cards the defendant had, at the request of the Fuller & "Warren Company, of Chicago, sent to them in February, 1885, as sample cards of its work, and had stated a price for them. The Fuller & Warren Company delivered the cards to Clarke to be imitated by him, and Clarke forwarded them to plaintiffs with the request to see the defendant as aforesaid. Instead of seeing the defendant, plaintiffs offered to furnish the cards themselves, and on March 18, 1885, "they received an order from Clarke for 200,000 of these two designs at the lump price of $340. Plaintiffs thereupon imitated defendant’s cards, and printed 224,000 for Clarke. These cards were shipped to Claike. In addition to the 200,000 made for Clarke, plaintiffs printed an additional quantity of 169,000, which they sold prior to May 20, 1885, to Cassell & Co., McCann, Fridenstein, Hardy & Co., and West Side Tailoring Company. On April twenty-third the said Clarke wrote to the White Sewing-Machine Company, customers of defendant, for whom it had made, in the fall of 1884, the cards in question, offering to let them "have a lot of the same cards at a reduced price. The White Sewing Machine Company wrote to defendant on April 27, 1885, complaining of this. Thereupon, on May 20, 1885, the defendant ■caused the following letter to be sent by their attorneys to plaintiffs, ■Clarke and Fuller & Warren :
    “ FRANKENHEIMER & ROSENBLATT,
    “ Counselors at Law.
    “ Equitable Building, 120 Broadway,
    “ New York, May 20, 1885.
    “ Messrs. Hastings & Toed :
    “Gentlemen.—We understand that you are using and disposing •of an advertising card containing the picture of a little boy in a red fez cap, known as “ A Little Turk.” The original of this picture, .a certain-crayon drawing entitled “ A Young Turk,” was duly copyrighted by the Hargreaves Manufacturing Company of Detroit, Michigan. This company has duly granted the sole right to reproduce this picture for advertising purposes to our clients, the Giles Lithographic Company, of this city, who are the sole licensees of the right of reproduction. We desire herewith to give you formal notice of this fact, and to notify you to refrain from using or in any way disposing of said cards, or any print, publication or display ■containing a copy or reproduction of said drawing or picture. You ,are also notified to surrender the cards in your possession to our clients, and also to account to them for such cards as you may have used or disposed of. Hnless we hear from you at once, we shall proceed against you to the utmost extent of the law.
    “We remain, yours respectfully,
    “FRANKENHEIMER & ROSENBLATT.”
    The plaintiff Hastings thereupon had several interviews with Mr. Giles, the manager of the defendant, with a view to arranging a settlement, and several letters bearing upon the same subject passed between the attorneys of the parties. In the course of his negotiations with Mr. Giles, the plaintiff Hastings was informed by Giles that the defendant had made, in 1884, its lithographic copies of the “ Alberta” aud “Little Turk ” cards from two colored photographs which it had purchased, without knowledge of the fact that the pictures were copyrighted ; that, in the fall of 1884, they had printed a large lot of these cards for the White Sewing Machine Company, for advertising purposes; that long after these cards had been delivered to the White Sewing Machine Company the defendant was notified by the Hargreaves Manufacturing-Company, of Detroit, that the “ Alberta ” and “ Little Turk ” pictures had been copyrighted by the latter company, and that the cards which the defendant had printed for the White Sewing-Machine Company constituted an infringement of these copyrights; that the defendant had thereupon consulted its counsel, and had been advised by him, after a full examination of the facts, that the copyrights of the Hargreaves Manufacturing Company were valid, that defendant had no good defense, and that it should settle with the Hargreaves Company upon the best terms possible; that, in pursuance of this advice, the defendant settled with the Hargreaves Company, paid them $600, and received from them an exclusive license to reproduce the “Alberta” and “Little Turk” pictures for advertising purposes; that thereafter the defendant, acting under the advice of their counsel, gave the notice complained of to plaintiffs’ customers. Hastings testified that he had no reason to doubt this statement that defendant was so acting under advice of counsel, and that it was a self-evident fact. Hastings further testified that he never asked to see the defendant’s license, and that he presumed the defendant had some paper to that effect.
    On June 4, 1882, plaintiffs, through their attorneys, wrote to the defendant, threatening to sue it for $10,000 damages unless it withdrew its unlawful notices within twenty-four hours. Defendant’s attorneys replied, suggesting an amicable arrangement of the matter. Plaintiffs’ attorneys were informed by letter from defendant’s attorneys, dated June 8, 1885, that no cards without the copyright notice had been disposed of by defendant since the acquisition by them of the exclusive license; that prior to the acquisition of the exclusive license the defendant had printed a lot of cards for the White Sewing Machine Company without knowledge of the copyright of the Hargreaves Manufacturing Company; that the defendant were compelled to pay for this infringement, and had obtained an exclusive license to produce the pictures for advertising-purposes ; and that if plaintiffs had obtained any cards with the defendant’s impress thereon, they must ■ be cards printed before the license was obtained. The negotiations for a settlement fell through, and on July 10, 1885, plaintiffs began the present suit. The plaintiffs sought to establish the allegation of the complaint that defendant’s claim to an exclusive license to reproduce the said pictures for advertising purposes was unfounded, by proving that in the fall of 1881 the defendant had printed these cards for the White Sewing Machine Company without the copyright notice required by the United States Statutes imprinted thereon; • and that it had sent two sample cards to the Fuller & Warren Company in February, 1885, without such copyright notice thereon. All this the defendant admitted it had done, both by the letter of its attorneys and by oral admission made 'by Giles to Hastings, but at the same time it informed plaintiffs, before this action was begun, that this was done without knowledge of the fact that the pictures were copyrighted, and before the defendant had acquired its exclusive license, and that defendant had to pay dearly for their infringement of the copyright. Ho evidence was introduced to show that the Hargreaves Manufacturing Company did not own copyrights of the two pictures “ Alberta ” and “ Little Turk. ” Ho evidence was introduced to establish that the defendant did not hold an exclusive license from the Hargreaves Manufacturing Company to reproduce these pictures for advertising purposes-; in fact, the plaintiff, Hastings, said that he presumed the defendants had such a paper. Ho evidence was introduced to establish that the defendant had issued any of the cards in question without the statutory copyright notice thereon, or had done anything to dedicate the cards to the public, after they had acquired their exclusive license.

      F. B. Candler, for the appellants.

      John Frankenheimer, for the respondent.
   Brady, J.:

It may be said, in limine, that the plaintiffs’ case would seem to rest substantially on the infringement of the copyright of the Hargreaves Manufacturing Company by the defendant, as admitted by them, before they had acquired any right from that company by an exclusive license. This would in no legal view that can be presented sustain an action like this, which depends for success "upon two elements, falsity and malice. (Steward v. Young, L. R., 5 C. P., 126; Kendall v. Stone, 5 N. Y., 14, 18; Hovey v. Rubber Tip Pencil Co., 57 id., 119; Celluloid Mfg. Co. v. Goodyear, 13 Blatch., 375; Burnett v. Tak, 45 L. T. [N. S.], 743.)

It seems to have been conceded on the trial that the defendant had what was claimed by it, namely, an exclusive license; and assuming that to have been established by concession or proof, the first requisite is wanting in the plaintiff’s case. The statement made by the defendant must, therefore, be assumed to be true, and what was done to protect the right secured by the license cannot be said to be malicious. Indeed, it was declared in Hovey v. Rubber Tip Company (supra), “ if the defendant, believing itself to have an exclusive patent, issued such a notice in good faith as a warning to dealers against an invasion of its rights, it in so doing would only have discharged a moral obligation and satisfied the demands of fair dealing. In such a case a mistake, on its part, as to the validity of its right, would not have rendered it liable to an action.” If the falsity of the statement were established, malice, it is true, might be inferred or pronounced upon facts and circumstances accompanying the act complained of. Here, however, one of the plaintiffs said in one of the interviews which took ¡dace between him and Mr. Giles, in relation to the subject of this action, that he never asked to see the exclusive license the defendants claimed to have secured from the Hargreaves Manufacturing Company for the production of the “ Little Turk ” and the “Alberta ” cards for advertising purposes. He presumed, he said, they had some paper to that effect. There is no doubt it had and that he believed in its-ownership of a ‘license. And it - proceeded regularly to enforce its rights by the employment of competent counsel, who, after examination of the subject, wrote the letter detailed in the statement of facts and advised the course pursued by the defendant.

The manner in which they sought to protect themselves was cautious, and, under all the circumstances leading to it and distinguishing it, it could not,per se, create any other just impression than that they were doing what careful business men would do to protect their interests. Indeed, in Halsey v. Brotherhood (L. R., 15 Ch. D., 514; affirmed 19 id., 386), the right to give notices, the notice being bona fide, is recognized and declared to be a duty to protect a patent. The rigorous maintenance of a right can never be construed as malicious. The defendant could resort to all the remedies known when its cause was just in a legal sense, and the plaintiffs can gain no right to indemnity in this action from the prior improper infringement by the defendant of the copyright under which it subsequently became licensees. Doubtless this would be a good defense in an action by the defendant for an infringement (U. S. R. S. § 4962; Paper Bag Cases, 105 U. S., 766 ; Littlefield v. Perry, 21 Wall., 295), but this is a very different controversy. The plaintiffs seek damages for slandering their title to the cards named, as a commercial article or their right to deal in them, and they have not shown their superior ownership of and right to use them — the falsity of the defendant’s claim to them or malice in its assertion. The plaintiffs, indeed, must succeed on the strength of their own asserted title, and not on any infirmity of the defendant’s arising from kindred violations of the law of copyright. The result of this review is, therefore, that the court did not err in refusing to leave the question of malice to the jury. There was no falsity shown of which to predicate the right to that procedure; and the dismissal of the complaint was correct for the same reason if no other existed. The exclusion of the evidence relating to damages, even if improper, could by no possibility prejudice the plaintiffs, inasmuch as the underlying weakness of their case was not removed, and left them powerless to maintain the action as we have seen.

There does not seem to spring Jrom the record any reason why the appellants should have a new trial, and the judgment must, therefore, be affirmed, with costs.

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

Judgment affirmed, with costs.


source: Caselaw Access Project

license: Public Domain

text:
    In the Matter of the Petition of MARGARET HEERY for the Discharge of JAMES MOLONEY, an Infant.

      Commitment, under section 291 of the Penal Code, of a child, not homing any home or proper guardianship — notice of the proceedings must be given to the parent, guardian or custodian—when notice not necessary.

    Upon an appeal from an order made on the return to writs of habeas corpus and certiorari discharging from the custody of the appellants James Moloney, a child four years of age, it appeared that the infant James Moloney was taken before a police justice on a charge which stated, under oath, that the said James Moloney, aged four years, was found by deponent, not homing any home or propier guas’dianship, and that the justice found that he was in a state of want and suffering and destitute of means of support, the child’s mother being- dead and the whereabouts of the father being unknown. The commitment did not contain a statement that any notice was given of the proceedings to the parent, guardian or custodian of the child as was required by subdivision 5 of section 291 of the Penal Code.

      Neld, that, as in this case the infant had a custodian, the order discharging the child from custody should he affirmed.
    That the language of the section manifestly referred to those waifs who are homeless, having no abiding place and no guardian, and to a permanent and usual condition, and not to that of a child casually in the street without protection.

      People ex rel. Van Riper v. New York Catholic Protectory (106 N. Y., 610) followed.
    That if the circumstances of the case were unusual, as if from accident, the child had temporarily strayed away from its home without the fault of the custodian, the statute did not apply, but if it were otherwise and the child had neither parent, guardian or custodian, then it should he protected by a commitment.
    That in order to properly ascertain whether the circumstances were usual or unusual, it was provided by the Penal Code that a notice should he given to the parent, guardian or custodian.
    That it did not matter how such custody had been obtained; that the parents might be unknown except to the custodian, and such custodian might have accepted the child as a charge, or stolen or found him.
    Appeal from an order made at a New York Special Term upon returns to writs of habeas corpus and oertiora/ri, discharging from the custody of the appellants, the Sisters of the Order of St. Dominick, James Moloney, a child' four years of age, which order was entered in the office of the clerk of the city and county of New York on September 26, 1888,

      E. T. Gerry, for the appellants.

      E. G. Delay, for the respondent.
   Brady, J.:

The infant, James Moloney, was taken before a police justice on a charge which appears to have been stated under oath as follows: The James Moloney, “ now present,” aged four years, was found by deponent, not homing a/ny home or proper guardianship, being in a state of want and suffering cmd destitute of means of support, the child’s mother being dead and the whereabouts of the father being unknown. This appears to have been made the subject of inquiry by the justice, who became satisfied that it was true and a commitment was issued. That process does not, however, contain a statement of any notice given of the proceeding which was required by the Penal Code of 1887 (§ 291). The notice is to be given to the parent, guardian or custodian of the child. It was given to no one. The record shows that the infant was in the custody of a person, and whether the possession was obtained rightfully or wrongfully makes no difference; the design of the statute was to protect homeless children and those in a state of want or suffering from want of proper guardianship, and those also destitute of support. The absence of proper guardianship would be established by proof of abandonment or neglect, resulting from the bad habits of the custodian or parents, and by which the infant was permitted to be. in a state of want or suffering. The object of the-statute was beneficent, however censurable, .for the power conferred by it or the omission of comprehensive guards against oppression or despotism, if it be subject to any such criticism. The infant, for example, may be found on the street alone, half clad, cold, hungry, either or all, and suffering and without any apparent protection. This condition may arise from gross neglect of guardian or custodian or from the culpable negligence of the parents or from accident, the child having temporarily strayed away from its home without fault of its custodian. If taken before a magistrate, which would be a humane act as well as'lawful, the inquiry begins, the design of which is to ascertain whether the circumstances are usual or unusual, and to dispose of the-charge accordingly. If the circumstances are unusual and the child have a home and custodian, the statute does not apply; but if it be otherwise and the child has neither, then it should be protected by a commitment. In order properly to ascertain whether the circumstances are usual or unusual, a notice is provided for and the provision relating to it is comprehensive and sweeping. It is to be given to parent, guardian, custodian, and thus embraces all. It does not matter how the custody has been obtained, for it might be the parents are unknown, except to the custodian, who may have accepted the child as a charge, or stolen or found him. It is impossible that, for any period worth consideration, an infant should be absolutely without a custodian, and hence the provision relating to that personage, to which reference has been made. The officer taking the child and making the charge in this proceeding, for example, gives the name of the infant. From whom was the information derived ? If from the infant, he could, no doubt, have given the name of the person with whom he lived and who had charge of him or state where he lived. And if given by some other person, the further information could, no doubt, be obtained. There does not appear, therefore, to be any reason why the salutary and, indeed, indispensable element of notice should be disregarded, even if a discretion in relation to its uses were given to the committing magistrate, but it is not. The legislature must have contemplated that great suffering, if not great wrong, might be entailed or done by hasty and improvident arrests under the provisions of the act. The poor are not destitute of great love of their offspring. Indeed, their affection for them is as expressive and impressive as that in other spheres, but they may often, as they unfortunately are, be unable to continuously furnish all the necessary comforts to their children. It is not to meet such temporary emergency that the statute was enacted, but, as suggested, to jirovide against the culpable neglect of the parents, their demoralization from bad habits, their unfitness for any cause to be allowed to retain their children and permit them to suffer from any form of exposure. The language of the section manifestly refers to those waifs who are homeless, having no abiding place and no guardian, and to a permanent and usual condition, and not to a child casually in the street without protection. (People ex rel. Van Riper v. N. Y. C. Protectory, 106 N. Y., 609.) It is not necessary, however, to pursue this vein of reasoning. It is enough that the statute required the notice. The information in these proceedings for summary conviction ought to be precise and show a case clearly within the statute; and when an essential ingredient or circumstance is omitted and the defect is not supplied by the evidence, the conviction is bad. (Case, supra) And, as said by Justice Andrews in the case cited, “ it is not consistent with the proper security of personal liberty to indulge, in cases of summary convictions, in latitude or liberality of intendment to support the proceedings.”

For these reasons the order appealed from should be affirmed. Ordered accordingly.

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

Order affirmed.


author: Bartlett, J.:

text:
    ANNA E. CHURCHMAN, Respondent, v. HANNAH B. MERRITT and Others, Appellants.

      Action to reform a deed — examination of a party before trial — the grounds upon which relief is sought must be stated with reasonable certainty.

    Where a suit is brought to reform a written instrument, it is not a sufficient compliance with that provision of the Code of Civil Procedure (§ 872, sub. 2), which requires that the nature of the action shall be stated as a prerequisite to an order for the examination of the party before trial, merely to state that the purpose of the action is to reform a deed or mortgage or other paper, as the case may be, but the grounds upon which the relief is sought should be indicated with reasonable certainty.
    An order denying a motion, in this case, to vacate' an order for the examination of the defendants before trial, reversed upon the ground that the affidavits upon which the application was made by the plaintiff were insufficient in this respect.
    Appeal from an order, made at the New York Special Term, denying a motion to vacate an order for the examination of the defendants in this action before trial, which was filed in the office of the clerk of the city and county of New York on August 3,1888.

      Marshall P. Stafford, for the appellants.

      James E. Chandler, for the respondent.
   Bartlett, J.:

The avowed purpose of the examination, which has been ordered in this case, is to enable the plaintiff to frame her complaint. That the provisions of the Code of Civil Procedure, relating to the examination of parties before trial, authorize a plaintiff to examine a defendant for this purpose, was established by the decision in Glenney v. Stedwell (64 N. Y. 120.) But the right of a plaintiff thus to obtain discovery of facts, which he desires to allege in his complaint, is conditioned upon his showing that he has a cause of action against the defendant. Such was the rule in chancery and such is the rule under the Oode. It was essential to a bill of discovery, in equity, that the bill should set forth, with reasonable certainty, the nature of the suit which .had been brought (Story’s Eq. Pl., § 321); and under our present system of procedure if an action is pending, the nature of the action and the substance of the judgment demanded must be stated in the moving affidavit. (Code Civil Pro., § 872, sub. 2.)

In the present case the plaintiff swears that this action “ has been brought to reform and correct a certain mortgage given by the defendant Hannah B. Merritt to the defendant Edward H. Brown,” as trustee of the plaintiff, upon certain leasehold premises, Ho. 131 William street, in the city of Hew York. There is nothing in the papers to show whether any error or informality in the mortgage, or any omission therefrom, was due to fraud or mutual mistake, or to indicate what the plaintiff claims or supposes the facts to be in regard to .the execution and delivery of the instrument. The plaintiff says she has been advised by her counsel that the mortgage is not a sufficient and good security for the $25,000 it purports to secure. She also states on information and belief, that her trustee, the defendant Edward II. Brown, was in a precarious condition of health before she received the mortgage from him, and that he has since been under restraint for mental ailments; and she denies any knowledge as to how or under what circumstances he was induced to take “such an extraordinary instrument as security for the loan of so large a sum of money.”

It seems that the defendant George Merritt acted as agent for the defendant Hannah- Merritt in making the mortgage; and the plaintiff further says that she is unable to state whether the present condition of the bond and mortgage is due to a mutual mistake or whether her trustee labored under a mistake, in regard to “ certain facts touching the value .of the mortgage in question,” which the defendant George fraudulently took advantage of to her prejudice. There are no specifications as to these “ certain facts,” unless they be found in the criticisms made upon the mortgage by the counsel for the appellant. These are, first, that the description of the premises is meager and, in his judgment, defective; secondly, that the mortgage contains no covenant of any kind requiring any insurance to be kept upon the property; and, thirdly, that there is no covenant on the part of the mortgagor to pay taxes. The absence of these covenants renders the mortgage, in his opinion, a doubtful security. Their omission from the instrument, however, does not of itself warrant any inference of fraud or mistake, nor does the plaintiff undertake to say that they were fraudulently or mistakenly left but. From the statements which have been mentioned, and others contained in the moving papers, it would seem that the plaintiff’s real purpose in the examination of the defendant is not to obtain knowledge of facts which will facilitate the statement of a known and ascertained cause of action, but is rather to find out whether any cause of action whatever really exists in her behalf against these defendants, or any of them. Under these circumstances an examination of a defendant before trial is not authorized by the statute. To sanction it would be to permit investigations of the most harassing character and give rise to a practice liable to grave abuse.

■ Where a suit is brought to reform a written instrument, it is not a sufficient compliance with that provision of the Code, which requires that the nature of the action shall be stated as a prerequisite to an order for the examination of a party before trial, merely to state that the purpose of the action is to reform a deed or mortgage or other paper as the case may be; but the grounds upon which relief is sought should be indicated with reasonable certainty. The affidavits upon which the present application is based seem to us insufficient in this respect, and the order should, therefore, be reversed, with costs, but without prejudice to another application upon papers setting forth a cause of action.

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

Order reversed, with ten dollars costs and disbursements.


author: Macomber, J.:

text:
    In the Matter of the Judicial Settlement of the Account of ALGERNON S. SULLIVAN, Public Administrator, as Administrator, etc., of RICHARD TOBIN, Deceased.

      Absence for over eighteen years without having been hem’d from—presumption of death without issue.

    Upon an accounting made on July 3, 1885, before the surrogate of New York by the public administrator, as administrator of Richard Tobin, who died in the city of New York on the 23d day of January, 1884, the administrator was directed to pay one-fourth of the estate to Michael Tobin, one-fourth to Ellen CooKe, and the residue into the city treasury for the benefit equally of John Tobin and Mary Molloy, two of the next of kin of the deceased. At the time the accounting was had it was not known whether either John Tobin or Mary Molloy was living.
    In October, 1885, Michael Tobin and Ellen Cooke, by publishing notices in Melbourne and in Sidney, in Australia, where John Tobin and Mary Molloy had gone in 1869, and by correspondence and other like acts, endeavored to ascertain whether these relatives were living, and if so where they were, and if not living if they left descendants; and being satisfied from the evidence which fliey were able to obtain that these absentees were dead, applied to the surrogate for and obtained from him an order directing the payment of the funds, in the hands of the comptroller of the city of New York, to the said Michael Tobin and Ellen Cooke as the next of kin of the deceased.

      Held, that as there was no evidence of the reception by their relatives of any letters or other intelligence of them after the arrival of John Tobin and Mary Molloy in Australia, excepting during the first year or two after their departure from Ireland, their death would be presumed to have taken place at the end of seven years from their departure from Ireland.

      Eagle v. Emmet (4 Bradf., 117) followed.
    That, as John was not married when he left home, and Mary, though married, had no children at that time, and there was no evidence that any were born to her subsequently, the order of the surrogate should be affirmed.
    Appeal by the comptroller of the city of New York from an order of the surrogate of the county of New York, directing the comptroller to pay over certain funds in his hands to the next of kin of the above-named decedent, which order was entered in the Surrogate’s Court of the county of New York on September 4,1888.

      Henry R. Beekmam, and Frank W. Arnold, for the appellant.

      George W. Carr, for the respondent.
   Macomber, J.:

Letters of administration upon the estate of ¡Richard Tobin, who died in the city of ¡New York on the 23d day of January, 1884, were issued by the surrogate to the public administrator. Upon an accounting made before the surrogate by the public administrator on the 3d day of July, 1885, the administrator was directed to pay one-quarter of the estate to Michael Tobin, one-quarter to Ellen Cooke, and the residue, namely, one-half of the estate, into the city treasury for the benefit equally of John Tobin and Mary Molloy, two of the next of kin of the deceased. At that time it was not known whether either John Tobin or Mary Molloy was living. In the month of October, 1885, the other two next of kin, namely, .Michael Tobin and Ellen Cooke, to whom the money is now directed to be paid, by publishing notices in Melbourne and in Sidney, in Australia, where John Tobin and Mary Molloy had gone eighteen years previously, and by correspondence and other like acts, endeavored to ascertain whether these relatives were living, and if so where they were, and, if not, if they left descendants. Being satisfied from the evidence which they were able to - obtain that these absentees, of whom they had not heard for over seven years, were dead, they applied to the surrogate in January, 1888, for modification of the previous decree and for payment to them, as the next of kin of John Tobin and Mary Molloy, of the portion which had been originally paid into the city treasury in due course of the administration of Richard Tobin’s estate. The surrogate, however, was not satisfied of the sufficiency of the proof then adduced, and denied the application, but with leave to renew the same. Subsequently, upon further evidence, the order appealed from was made.

After an absence of seven years, without any intelligence of him by those who would be likely to hear from him by letter or otherwise, the person will be presumed to be dead. This presumption has been extended so as to lead to the conclusion, in the absence-of any evidence whatever of actual living, that the death took place at the end of the s'even years. (Eagle v. Emmet, 4 Bradf., 117.) John and Mary left Ireland in the year 1869, about eighteen years before this application was made. There is no evidence of the reception, by their relatives, of any letters or other intelligence of them.after their arrival in Australia, excepting during the first year or two after their departure from Ireland. If these presumptions are to be indulged to their full extent, it would appear that neither John nor Mary could have succeeded personally to any of the property of their father, Richard Tobin. Furthermore, John was unmarried when he left home, but Mary, though married, had no children at that time, and there is no evidence that any were born to her subsequently.

As the learned surrogate said, in his opinion, on the first hearing of this application, “ the presumption that the person died without issue will be sustained by very slight proof, such as failure to hear of any such issue, or failure to answer advertisements calling for heirs, as was done in this case.” (Greaves v. Greenwood, L. R., 2 Exch. D., 289.)

On the whole, we are satisfied that the learned surrogate has proceeded cautiously in the consideration of this application, and has acted upon sufficient legal evidence establishing the death of John Tobin and Mary Molloy; and that, consequently, the order appealed from should be affirmed, with costs and disbursements to be paid out of the funds.

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

Order affirmed, with ten dollars costs and disbursements to be paid out of the funds.


author: Van Brunt, P. J.:

text:
    In the Matter of the Petition of CHAUNCEY N. BRAINERD, Appellant, to Vacate an Assessment for Sewers in Tenth Avenue, etc.

      Application, under chapter 338 of 1858, now sections 898, etc., of chapter 410 of 1882, to vacate or reduce an assessment — no relief can be granted, as to assessments confirmed after chapter 550 of 1880 (§ 903 of chap. 410 of 1882) took effect, where the assessment is claimed to be absolutely void.

    On an application to vacate or reduce an assessment, brought under the provisions of chapter 338 of 1858, which have been incorporated into sections 898, etc., of the consolidation act, it appeared that the errors assigned were that the sewer, for the expense of which the assessment was made, was of no benefit to the plaintiff’s property, having no outlet capable of draining and carrying off water; that no plan or suitable map showing the location and course of said sewer was filed as required by law; that the outlet of said sewer was upon private land which had not been taken for public use, and that any assessment for such sewer was, therefore, illegal and void.
    The assessment in question was confirmed after the act (chap. 550 of 1880) was passed, and it was conceded that there was no means of ascertaining to what extent the assessment in question had been increased, in dollars and cents, by the errors complained of, and it was not charged that there was any fraud in the case. The ground taken by the appellant was that the assessment was absolutely void in consequence of such errors.

      Held, that the effect of the passage of section 12 of chapter 550 of 1880, re-enacted in section 903 of the consolidation act, was to take away the power of the court to vacate the assessment.

      Matter of Smith (99 N. Y., 424); Chase v. Chase (95 id., 377) followed.
    That while the act of 1880 did not validate an illegal assessment, it did affect the special remedy conferred by the act of 1858, and that such act no longer, after the passage of the act of 1880, covered the particular wrong complained of in this case.
    That the injured parties were remitted te the ordinary remedies of citizens generally, except that a bill in equity to vacate the assessment, or remove it as a cloud upon title, was forbidden by section'897 of chapter 410 of 1882.
    Appeal from an order, made at a New York Special Term, denying tlie prayer of the petitioner for relief by the vacating or reduction of an assessment, which order was entered in the office of the clerk of the city and county of New York on May 23, 1888.
    The following is the opinion delivered by Lawrence, J., at Special Term:
    Lawrence, J. This is an application to vacate an assessment on the ground of substantial errors, the errors assigned being mainly that the sewer in question is of no benefit to the petitioner’s property, having no outlet capable of draining and carrying off water; that no plan or suitable map showing the location and course of said sewer was filed in accordance with chapter 381 of the Laws of 1865 (Consolidation Act, chap 410 of 1882, § 327, etc.), prior to the construction of the same; that the outlet of said sewer is upon private property, which has not been taken for the public use, and that in discharging the water and other material from said sewer upon said property, the city authorities have been guilty of a trespass; and that any assessment for said sewer is, therefore, illegal and void, under the authority of the People ex rel. Williams v. Haines (49 N. Y., 587); Matter of Rhinelander (68 id., 105); Matter of Cheesebrough (78 id., 232, and similar cases).

      It is contended by the corporation counsel, in resisting the motion, that the court is forbidden by section 903 of the consolidation act (which is but a re-enactment of section 12 of chapter 550 of the Laws of 1880), from vacating the assessment. That section is as follows: “No court shall vacate or reduce any assessment, in fact or apparent, confirmed after June 9, 1880, whether void or voidable, on any. property, for any local improvement hereafter completed, otherwise than to reduce any such assessment, to the extent that the same may be shown, by parties complaining thereof, to have been in fact increased in dollars and cents, by reason of fraud or substantial error; and in no event shall that proportion of any.such assessment which is equivalent to the fair value of any actual local improvement, with interest from the date of confirmation, be disturbed for any cause. Nothing in this section shall apply to any assessment which may be imposed for the local improvements known as Morningside avenue.”
    Upon the argument of this motion and in the brief then handed in on behalf of the petitioner, the effect of that section of the consolidation act was not discussed, and I therefore gave leave to file a brief in reply to that filed by the corporation counsel. Neither side has cited any authority directly in point, as to the construction which is to be given to section 903, nor have I been able to find any case where it has been expressly held, that the power heretofore exercised by the court to vacate an asssessment which was absolutely void, had been taken away by said statute.
    The nature and object of the statute has, however, been referred to in one or two cases which have been before the Court of Appeals, and one of them affords much aid in determining the question whether the point raised by the corporation counsel is sound. In the case of Chase v. Chase (95 N. Y., 377, 380, 381), the court said that the assessment then under consideration having been confirmed in December, 1818, was not affected by chapter 550 of the Laws of 1880, from which section 903 of the consolidation act is taken; and they further said, after quoting a portion of the language of said act: “ If either of these words describe the result of a successful answer to an effort by the city or other party to enforce the assessment, then it must be conceded that the appeals should fail. Ye think they do not. They assume the appearance of the property owner before the courts in a different attitude, as a party plaintiff, or as one complaining, and who, by appropriate action, instigates a court to act affirmatively in his behalf, and through judicial action modify or vacate the assessment. Such, also, is the clear inference to be drawn from the language of section 12 of that act (chap. 550 of 1880): 1 No existing provision of law,’ it says, ‘ shall enable or permit any court to vacate or reduce any assessment * * * otherwise than to reduce it to the extent that the same may be shown by parties complaining thereof,’ etc. A party who defends upon the ground that the alleged assessment is, in fact, no assessment, who asks no favor from the court, but only that legal protection to which he is entitled, can in no sense .be regarded as a party complaining, or as an actor in the proceedings. * * * The act of 1880 limited the effect of existing provisions of law, and, in terms, repealed inconsistent' statutes, and declared a short period of limitation, within which proceedings might be taken to vacate or reduce assessments. It went no further. It was evidently aimed at evils tolerated by previous statutes, and was to incite to diligence the aggrieved taxpayer. But it contains no words designed to take away any common-law right of defense against the enforcement of a void tax, or to validate erroneous or void assessments.”
    In the Matter of the Manhattan Elevated Railroad Company (102 N. Y., 301, 304) the court held that the act of 1880 had no application to the assessment under consideration, having been confirmed before that act took effect. It is conceded in this case that there is no means of ascertaining to what extent the assessment in question has been increased in dollars and cents by the substantial errors complained of. It is conceded that there was no fraud in the case, and the ground is taken that the assessment is void absolutely in consequence of such errors.
    I am constrained to say, after an examination of the record and of the statute, that I think that the effect of the statute is to take away the power of the court to vacate this assessment. It was confirmed after the act of 1880, and after the consolidation act took effect. The language of the statute is, that “ any assessment, in fact or apparent, confirmed after June 9, 1880, whether void or voidable, can only be reduced to the extent that the .same may be shown by parties complaining thereof to have been, in fact, increased in dollars and cents by reason of fraud or substantial error, and in no event shall that proportion of any such assessment, which is equivalent to the fair value of any actual local improvement, with interest from the date of the confirmation, be disturbed for any cause.” There is no means of determining from the evidence before me what proportion of the assessment in question would be equivalent to the fair value of the actual local improvement, and, as is already said, it is impossible to determine to what extent, in dollars and cents, the assessment has been increased by the errors complained of.
    I think it quite apparent from the language used, by the Court of Appeals in Chase v. Chase that the court regarded the statute of 1880 and the consolidation act as taking away from the party aggrieved by a void assessment, where'the amount of damage in dollars and cents, or the fair proportionate value of the improvement could not be ascertained, the right to move to set aside such assessment. That case, however, distinctly asserts that the right still remains in the party aggrieved by a void assessment to resist any proceeding which may be taken by the city authorities for the enforcement of the same. Therefore, the petitioner, if his allegations in respect to the invalidity of this assessment are true, and if the assessment is void, is not without redress. He can repose upon his rights when an attempt is made to enforce the assessment. He can resist its collection if he be able to show that it is void. (See remarks of Danforth, J., at page 381 of 95 N. Y.)
    The motion to vacate the assessment is, therefore, denied.

      James A. Deering, for the appellant.

      George L. Sterling, for the respondent.
   Van Brunt, P. J.:

The ground upon which it is sought to set aside this assessment is that the sewer was constructed without lawful authority, and that the assessment, therefore, is illegal and void, and that the petitioner is entitled to have it vacated of record. Mr. Justice Lawrence, who heard the motion in the court below, clearly shows by his opinion that no such relief can be granted in this proceeding, and the views expressed in such opinion we adopt. That he arrived at the correct conclusion is evidenced by the decision of the Court of Appeals in the Matter of Smith (99 N. Y., 424), in a proceeding of a character similar to the' one at bar, to vacate an assessment because there was no authority for the doing of the work for which the assessment was levied. The court in that case say: The petitioner is pursuing his remedy under the provisions of the act of 1858, chapter 338, and its amendments. That is a special remedy which was given in addition to and in excess of the usual and ordinary remedies of the citizen in repelling an unlawful levy, and resisting an illegal claim. It was speedy and summary, confined to one locality, and designed to remedy evils peculiar to that locality. It was a remedy which the legislature might give or refuse, and having given, might modify or limit at its pleasure. Originally very broad and covering a large class of cases, it was at a later period very much narrowed and restricted. (Laws of 1880, chap. 550, § 12.) That restriction took the form of a positive prohibition, which forbade any interference with assessments through the operation of the special remedy as to all such confirmed after June 9, 1880, for any improvement completed after the date of the enactment, and whether such assessments were “ in fact or apparent” “ void or voidable,” except that they might be reduced to the fair value of the actual improvement made. For all assessments back of June, 1880, the special remedy remained unchanged, but from that time forward its sole possible application was to cases where the complaint could be redressed by reducing the assessment to the level of the just value of the improvement. It is argued that this amendment did not repeal, and was not -intended to repeal, the act which forbids a repavement without consent of a majority of the property owners adjoining. That is true undoubtedly. The amendment does not validate an illegal assessment; but it does affect the special remedy so that it no longer covers that particular wrong and remits the injured party to the ordinary remedies of citizens generally, except that a bill in equity to vacate an assessment or remove it as a cloud upon title is forbidden. (Law's of 1882, chap. 410, § 891.) The property-owner may still challenge the validity of his assessment whenever his property is seized under it or it is made the foundation of proceedings against him.

The ground upon which the assessment in the case at bar is sought to be' set aside is precisely of the same character as that in the case cited; and under the principles laid down in that case in conformity with the statute, the appellant cannot avail himself of the peculiar facilities afforded by this statute.

The order should be affirmed, with costs.

Beady and Macombkr, JJ., concurred.

Order affirmed, with costs.


author: Daniels, J.:

text:
    AUGUSTUS C. BROWN, as Ancillary Administrator, Etc., of MARY R. BURNSIDE, Deceased, Respondent, v. THE FARMERS’ LOAN AND TRUST COMPANY, Appellant.

      Construing of a power to sell, ete., real and personal estate confen'redby a testatrix — her intention governs■—■ authority to pledge bonds to secure a loan and surrender them to the pledgee inpayment of it — when such apowe/r is general and beneficial and changes an estate for life into a fee in respect to creditors and purchasers—the plvrase “creditors and purchasers” defined — no reference to the statutory provisions relating to powers is necessary in the instrument.

    In an action brought to recover the proceeds of fifteen bonds of $1,000 each, secured by a mortgage upon real estate in Illinois, it appeared that the bonds . were owned by Mary R. Burnside at the time of her death on March 9, 1876, and that she left a last will and testament, by which she devised and bequeathed to her husband Ambrose B. Burnside, for and during the term of his natural life, all the rents, profits and income of all her estate, real, personal and mixed, and also appointed him executor thereof; and after his decease, after providing for the payment of certain legacies, the testatrix gave and devised all the rest, residue and remainder of her estate then remaining, in equal shares, to certain charities existing in the city of Providence, in the State of Rhode Island.
    The testratrix further by her will gave to her husband during his natural life “ full power and authority at his pleasure to change the investment of any personal property and estate, and also with power and authority, at his pleasure, to séll, transfer and convey any portion of my personal property and estate, execute the requisite conveyance and conveyances thereof, receive the proceeds of any such sale or sales and apply and appropriate the net proceeds thereof to and for his own use, benefit and behoof forever.
    The will was executed and proved in the State of Rhode Island. Letters testamentary were issued to the husband, who thereafter caused the existing registration of the bonds to be canceled and restored them to their former condition of bonds payable to bearer, and thereafter, and in June, 1879, applied to the defendant for a loan to him of the sum of $15,000 on the security of the fifteen bonds in controversy in this action. The loan was made and the bonds were delivered to the defendant, in whose possession they remained until they were paid out of the proceeds of the mortgaged property.
    Upon an appeal from a judgment holding that the only authority given to the husband over the bonds was to sell, transfer or convey them, and that the disposition so made by him Qf the bonds was neither a sale, transfer or conveyance of them;

      Held, that in construing the provisions of the will the intention of the donor of the power was the great governing principle.
    That, in furtherance of the object in view the courts will vary the form of executing the power, as the case may require, to effect the purpose intended; either enlarge a limited to a general power or cut down a general power to a particular purpose.
    That the leading and controlling intention of the testatrix was that her surviving husband should have the benefit of her estate, and the net proceeds thereof for his own use forever; that it could not have been her design that this general and extended right, conferred in this manner upon him, should' be subordinated to the mere form in which she had previously indicated that the power might be exercised. ,

      Downey v. Bissell (4 Federal Rep., 550); Stuart v. Walker (72 Me., 145); Bloomer v. Waldron (3 Hill, 361) followed; Albany Insurance Company v. Bay (4 Comst., 9); Herring v. Barrow (L. R., 13 Ch. Div., 144) distinguished.
    After the loan itself had been made, the husband having paid interest upon the loan up to a certain time, informed the president of the defendant that it was impossible for him to pay the loan and that the company must take the bonds for the money owing to it. In answer to this suggestion the president of the company agreed to take the bonds in this manner, and they afterwards remained in its possession, without anything further being said or done between these parties, until after the decease of the husband in September, 1881.

      Held, that a claim made by the plaintiff that by reason of the fact that no writing was executed at the time, and no formal delivery of the bonds took place, the agreement was void under the statute of frauds, could not be sustained, as the effect of such an agreement, followed by the continued possession of the property under it, was.to pass the title.

      Allen v. Cowan (23 N. Y., 502) followed.
    That the power given by the will to the husband was a general and beneficial power, within the meaning of those terms as defined in sections 77 to 79 of 1 Revised Statutes, 732; and by the provisions contained in sections 81 to 85 thereof the estate previously given to him for life was changed into an absolute ownership of the property so far as the rights of purchasers or creditors might arise under it.
    That persons dealing with him were entitled to act upon the fair effect and import to be attributed to the language itself, as the exponent of the intention of the person employing it; and the rights of the bank, in this case, were the same as though the will itself had been presented for the inspection of the defendant’s president at the time when the application was made for the loan upon the security of the bonds.
    That it was not essential to the right of the defendant, to the protection of these statutory provisions, that direct reference should have been made to them in the instrument used in execution of the power.
    That the phrase “ creditors and purchasers,” employed in said section 102, was sufficiently broad to include all persons dealing with the donee of the power in respect to the property..
    Appeal from a judgment entered in the office of the clerk of the city and comity of New York on November 23,1887, on the report of a referee in favor of the plaintiff.

      Herbert B. Turner and David McClure, for the appellant.

      Stephen A. Walker, for the respondent.
   Daniels, J.:

The action was brought to recover the proceeds of fifteen bonds of $1,000 each, payable with interest at the rate of eight per cent, which were made by Simeon B. Buckner, of the city of Chicago, and secured by a mortgage upon real estate situated there. The bonds in controversy were the property of Mary R. Burnside during her life. She died on the 9th of March, 1876, and left a last will and testament, by which she devised and bequeathed to her husband, Ambrose E. Burnside, .for and during the term of his natural life, the free use and improvement, rents, profits and income of all her estate, real, personal and mixed. By her will she further declared and provided that he should, diming his natural life, have “full power and authority, at his pleasure, to change the investment of any personal property and estate, and also with power and authority, at his pleasure, to sell, transfer and convey any portion of my personal property and estate, execute the requisite conveyance and conveyances thereof, receive the proceeds of any such sale or sales, and apply and appropriate the net proceeds thereof to and for his own use, benefit and behoof forever.” She also appointed him executor under her will, and, after his decease, provided for the payment of certain legacies, and then gave and devised all the rest, residue and remainder of her estate, real,0personal and mixed, then remaining, in equal shares, to certain charities existing in the city of Providence, in the State of Rhode Island. The will was executed and proven in that State, and letters testamentary issued to the surviving husband of the testatrix. At that time the bonds now in suit were registered in her name in the office of the defendant, and the mortgage given to secure them was executed and delivered to the defendant in trust for that object. The bonds, upon their face, were made payable to bearer, and under the authority of the executor, Ambrose E. Burnside, their registration was canceled, and they were restored in that manner to their former condition of bonds payable to bearer.

After that, and in January, 1879, General Burnside applied to the defendant for a loan to him of the sum of $15,000 on the security of the fifteen bonds now in controversy. The loan was made and the bonds were delivered to the defendant, in whose possession they remained until they were paid out of the proceeds of the mortgaged property. This disposition of the bonds was assailed by the plaintiff, as ancillary administrator of the estate, appointee^ by the surrogate of the county of New York, on the ground that General Burnside had no power or authority to borrow money upon the bonds as he did from the defendant in this manner. And this position was sustained at the trial, and by the judgment from which the appeal has been taken. It was placed upon the ground that the only authority given him over the bonds, was to sell, transfer, or convey them, and that this disposition was neither a sale, transfer or a conveyance of these bonds. The construction which was given by authorities at common law to a devise and bequest for life, although empowering the devisee and legatee to dispose of the property by sale, was that it was no more than a power of sale, without enlarging and extending the life estate, otherwise given and declared by the will. In Jackson v. Robins (16 Johns., 538), the distinction was drawn between a devise of the property itself, with the addition of a power of sale, in which case the devisee would take the entire title, and a ''disposition of the same property for life, to which the devisee was given a power of disposal, for his or her own use and benefit. In the latter class of cases it was held by this, as well as other authorities, that the power did not enlarge or extend the life estate, and was no more, in any event, than a mere power of disposition, no way affecting the title, unless it was exercised in strict conformity to the language of the will. (Terry v. Wiggins, 2 Lans., 272; 2 Perry on Trusts [2d ed.], § 768; Switzer v. Wilvers, 24 Kans., 384; Henderson v. Blackburn, 104 Ill., 227.) But in these cases there was drawn in question no more than a simple power of sale, while in McCauley’s Appeal (93 Penn., 102); Hoyt v. Jaques (129 Mass., 286); Downey v. Bissell (4 Fed. Rep., 55); Stokes v. Payne (58 Miss., 614), the life tenant under the will was authorized to use, dispose of and consume the property, and still it was considered that a sale only, and not an hypothecation by way of pledge or security was within the authority conferred by the will. And this was also followed as to this will in Rhode Island Hospital Trust Co. v. Commercial National Bank in that State (14 R. L., 625.) But in Downie v. Bissell (supra), a clear intimation was given from which it is to be inferred that if it had been made to appear that the property had been in fact mortgaged to raise money for the use and enjoyment of the life tenant during lysr life, a different disposition of the cases might have taken place. And this view was followed in Stuart v. Walker (72 Maine, 145), where all that was directed by the decree was that the unexpended proceeds received by the life tenant should be surrendered or paid over under the authority of the action. And as much as that was conceded in the opinion on which the case of Bloomer v. Waldron (3 Hill, 361), was decided. For it was there said that, “ there was nothing in the purposes of the will as connected with a sale, which required anything beyond a mere power to effectuate. The casé is not, therefore, within the principle which from a necessity of carrying out consequences will sometimes imply a trust or an interest in the donee of the power proportioned to those consequences.” (Id. 365.) And the case of the Albany Insurance Company v. Bay (4 Comst., 9), does not gainsay the accuracy of this intimation, for that involved no more than the right to mortgage under a general power of sale. (Id. 19.)

In the exercise of this authority it has been said-: “ The intention of the donor of the power is the great principle that governs in the construction of powers, and, in furtherance of the object in view, the courts will vary the form of executing the power ; and, as the case may require either enlarge a limited to a general power, or cut down a general power to a particular purpose.” (4 Kent [7th ed.], 362; [11th ed.], 381, 345.) And this case ought justly and rationally to stand upon the support of this principle. For the leading and controlling intention of the testatrix was that her surviving husband should have the benefit of her estate and the net proceeds thereof for his own use forever. And it could not have been her design that this general and extended right conferred in this manner upon him should be subordinated to the mere form in which she had previously indicated that the power might be exercised. That would be to sacrifice the substance to form and limit the execution of her design to a literal compliance with what was indicated as no more than a mode in which the proceeds of the property might be obtained by him for his use, benefit and behoof forever.

The case of Herring v. Barrow (L. R., 13 Ch. Div., 144) has no application to this controversy. For it has not been contended, and cannot be, that the surviving husband, under this will, would have the power to dispose of the estate, or any part of it, by a testamentary devise or bequest ; the sole and only point being- whether this transaction, as it is shown to have taken place, was within the authority conferred upon the surviving husband. According to the strict letter, even though within the intent, it probably was not, although the contrary was held as to this particular power, by the Circuit Court of the United States for the Eastern District of Massachusetts, in the case of the Rhode Island Hospital Oompamp v. Travers.

But further evidence was given concerning the business transacted between General Burnside and the defendant, which seems to carry .this case beyond the reach even of this doubt. For after the loan itself had been made, and the bonds had been received by the defendant as security for its payment, a further agreement was made between the borrower and the defendant. He had then paid interest upon the loan, and informed Mr. Rolston, the president of the defendant, that it was impossible for him to pay the loan, and that the company must take the bonds for the money owing to it. And in answer to this offer and suggestion made by General Burnside, the president of the company agreed to take the bonds in this manner, and they afterwards remained in its possession without anything further being said or done between these parties until after the decease of General Burnside, which took place on the 13th of September, 1881. This transaction has been resisted on behalf of the plaintiff as ineffectual, by reason of the circumstances that no writing was executed at the time by General Burnside, and no formal delivery of the bonds took place, and, consequently, that the agreement made in this manner was void under the statute of frauds. But in Allen v. Cowan (23 N. Y., 502), the effect of such an agreement, followed by the continued possession of the property under it, was considered to pass the title to it, even by way of gift, as that was in that instance the intention of the parties. The property which was the subject of the gift there, had been sold under a chattel mortgage and purchased by a nephew of the plaintiff. It consisted mainly, if not entirely of household goods, and after the sale, and without actual possession on his part, the purchaser pointed out the articles to the plaintiff, in whose house they were, and told her that he gave her that property and all the rest he had purchased that day. It seems to have been of a greater value than the price or sum of fifty dollars, and yet it was held by the court that this transaction vested the title to the disputed property in the donee. And if it did in that instance, the like effect would seem to be attributable to what took place in this case between General Burnside and the president of the defendant. And if it is to have that effect, then by the loan of the money and the hypothecation of the bonds for its security, and the agreement to surrender the prop-, erty to the defendant because of the inability of General Burnside to provide for and take up the loan, a complete sale or transfer, within this language as it was used in the will, appears to have been made.

When the transaction came to be finally closed up the company realized an excess, over and above its debt and interest, amounting to the sum of $5,300, and that it paid over to the administrator of the estate of General Burnside. And this circumstance has been considered as having a controlling weight over what occurred and transpired at the time when the bonds were surrendered to the defendant. But there is no reason for doubting the correctness and truthfulness of the statement made by Mr. Rolston, as to what took place between himself and General Burnside. And as that amounted to a surrender, or a completion of the sale of the bonds, the company was' under no obligation whatever to pay over the surplus. It had, on the contrary, the right to retain it for 'its own use or benefit, or to dispose of' it otherwise as. it might deem that to be just and proper. And paying it over to the administrator of this estate in no way changed the effect of what had previously taken place.

But if any doubt can remain as to the legality of these transactions, and the effect to be deduced from them by way of protecting the defendant from liability, it seems to be removed by the statute of this State declaratory of and defining the law concerning the creation and execution of powers. -This statute was considered, in Hutton v. Benkard (92 N. Y., 295), to be applicable both to personal and real property; and that, under its provisions, the creation, construction and execution of powers concerning personal property are to be governed by the same rules, so far as they can be applied, which govern the creation, construction and execution of powers as to real estate. (Id., 305.) By the first section of the article containing these statutory provisions it was declared, in the most general language, that powers, as they previously existed by law, were abolished, and, so far as the authorities have already been examined in their application to a 'will of -this description, they may, by this enactment, be considered to have been certainly limited and abridged. And the court has been left at liberty by it to carry into effect the design and intention of the testatrix without subordinating it to the mere form in which it was indicated that end might be accomplished. (2 R. S. [6th ed.], 1113, § 94.) But this statute nas proceeded very much further in its definitions and provisions concerning the creation and effect of powers. And under its provisions the power given to G-eneral Burnside in this instance was a general power and within the language of section 98 (page 1114) of this article declaring that “ a power is general when it authorizes the alienation in fee by means of a conveyance, will or charge * * * to any alienee whatever.” And by section 100 of the same article it has been declared to be beneficial where no person other than the grantee has, by the terms of its creation, any interest in its execution. These sections are plain in their language and appear to be directly applicable to this case. And they are followed by section 102 declaring that, “ when an absolute power of disposition, not accompanied by any trust, shall be given to the owner of a particular estate for life or years, such estate shall be changed into a fee absolute in respect to the rights of creditors and purchasers, but subject to any future estates limited thereon in case the power should not be executed, or the land should not be sold for the satisfaction of debts.” This section plainly includes this case, for the will gave to the donee of the power absolute power of disposition for his own benefit, and in trust for no person or persons whatsover. And under that power, according to this enactment, the estate previously given for life was changed into the absolute ownership of the property, so far as the rights of purchasers or creditors might arise under it. And this construction of the section is further sustained by section 106 of the same article declaring that “ every power of disposition shall be deemed absolute by means of which the grantee is enabled, in his lifetime, to dispose of the entire fee for his own benefit.” And the observance of nominal conditions in the disposition of the property has been dispensed with by section 141 (page 1117) of the article declaring that, “when the conditions annexed to a power are merely nominal and evince no intention of actual benefit to the party to whom, or in whose favor, they are to be performed, they may be wholly disregarded in the execution of the power.”

By the force and effect of these sections, which are applicable to this case, for the transaction affected by it wholly arose and occurred in this State, General Burnside was clothed with the absolute power of disposing of these bonds, so far as the rights of creditors or purchasers might intervene. In dealing with him they were entitled to the full benefit and effect of the directions contained in the will of the testatrix and construed in this manner. The rights were the same as though the will itself had been presented for the inspection of the defendant’s president at the time when the application was made for the loan upon the security of the bonds; and one object of the statute was to enable persons dealing under the authority of a testamentary disposition of this description to act upon the fair effect and import to be attributed to the language itself, as the exponent of the intention of the person employing it. And the conclusion would be justified, on the perusal of such a document, that the person entitled to the proceeds of the property for his own benefit, use and behoof forever, was authorized to deal with it as its absolute owner, and, as such, to hyphothecate it for the payment of a debt contracted in his behalf and for his benefit and use. This statute has given and was intended to secure to purchasers or creditors, under such an instrument, this degree of protection, and to abolish or materially abridge in their favor the distinction created by the preceding authorities between a general devise or bequest, with a superadded power of sale; and the creation of a life estate, with the addition of the power of absolute disposition for the benefit and advantage of the donee of the power. That this was designed to be the effect of the law is disclosed by the comments of the revisers (3 R. S. [2d ed.] 589), where it was said by them, in their report to the legislature, that, “ in reason and good sense, there is no distinction between the absolute power of disposition and the absolute ownership; and to inalce such a distinction, to the injury of creditors, may be very consistent with technical rules, but is a flagrant breach of the plainest maxims of equity and justice. There is a moral obligation on every man to apply his property to the payment of his debts, and the law becomes an engine of fraud when it permits this obligation to be evaded b^ a verbal distinction. It is an affront to common sense to say that a man has no property in that which he may sell when he chooses, and dispose of the proceeds at his pleasure. We apprehend the legislature will have no difficulty in declaring that, so far as creditors and purchasers are concerned, the power of disposition shall be deemed equivalent to the actual ownership.” So far as the property may not be disposed of in the execution of the power, future estates limited on a life estate have been maintained and preserved by section 102 of the article referred to; but this limitation has been restricted to so much only as may remain unexhausted by the execution of the power.

It is not essential to the right of the defendant to the protection of these statutory provisions, that direct reference should have been made to them in any instrument to execute the power. For as long as the donee was restricted in his right of disposition for his own use and benefit to the power, it is to be presumed that in the transaction the .power itself was employed as the source of the authority, for without it the donee would be incapable of. making the disposition of the property purposed to be, and in fact made by him.

The phrase creditors and purchasers,” employed in the enactment of section 102 of the article, is sufficiently broad to include all persons dealing with the donee of the power in the property of the estate for his use and benefit. It is certainly broad enough to include the case presented by this appeal, for by what took place the defendant did become a creditor as well as a purchaser of the bonds, even though it acquired no more than a defeasible interest. To that extent it was brought within the significance of these terms as they have been employed in the statute, although that degree of significance might not be accorded to them by the preceding authorities, which it was in part the object of this statute to change and abridge. Under the statutes of the State, where the rights of purchasers have been protected, persons dealing with property by way of security mortgage or pledge, have been considered to be within the protection of the law. (Hall v. Arnold, 15 Barb., 599 ; Reynolds v. Park, 5 Lans., 149; Stone v. Bartlett, 46 Me., 438; Williams v. Tilt, 36 N. Y., 319.)

There would clearly be no justice in holding, as General Burnside had the authority under the will to receive the proceeds of the sale or sales of any part of the property of the testatrix and apply and appropriate them to and for his own use, benefit and behoof forever, that the defendant should be liable to pay over to the plaintiff as, ancillary administrator of this estate, the moneys it had previously paid to and which had been used by the donee of this power under this authority. It was, on the other hand, the intention of the testatrix that he should have and enjoy such proceeds to his own use, and to that extent, certainly, the defendant was entitled to protection even under the cases already referred to of Stuart v. Walker, Downey v. Bissell, Bloomer v. Waldron (supra). The right of the defendant to protection as a Iona fide holder of these bonds as negotiable instruments need not be considered. If the case should be disposed of on that ground it probably could not result in protection to the defendant. For it liad become aware of the fact by the registration of the bonds, that they were the property of the testatrix, and continued to be so until the period of her own decease. And the subsequent dealings of the defendant in these securities would be affected by the continued application of this knowledge. (Loring v. Brodie, 134 Mass., 453.)

But on the other legal grounds, which have been fully considered, the judgment appears to be erroneous, and it should he reversed and a new trial ordered, with costs to abide the event.

Brady and Bartlett, JJ., concurred.

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


text:
    JOHN WILLIAM GUENTZER, Respondent, v. WILLIAM A. JUCH, Appellant.

      Agreement by the ovmer of a lot to pay one-half the cost of a party-wall erected by the owner of an adjoining lot— it may be enforced against his grantee who has purchased, subject to the agreement, and has used the wall.

    An agreement, under seal, was made between the plaintiff and one W. H. Richards, by which it was agreed that a party-wall should be built upon the division line between lands owned by these parties on the westerly side of Eleventh avenue in the city of Mew York, the wall to be erected equally on the property of each party. It was further agreed, as the plaintiff was about to erect the wall, that whenever Richards, his heirs or assigns, should make use of it by the erection of a building upon the lot, that there should be paid to the plaintiff, his heirs or assigns one-half the cost of its erection, and that this cost should be fixed by arbitration; that the cost of repairing or rebuilding the wall should be borne equally by the owners of the respective lots, and that the agreement should be perpetual and at all times be construed “ into a covenant running with the land and that no part of the fee of the soil herein described, and upon which the said party-wall is enclosed, shall be transferred or conveyed in or by these presents.”
    Richards thereafter conveyed his adjoining lot to one Cohen by a deed making the conveyance subject to the party-wall agreement, stating its date and that it was recorded in the register’s office. Cohen and wife thereafter conveyed the same property by a deed, declaring it to be conveyed subject “ to the said party-wall agreement, hereinbefore referred to,” to the defendant, who, after entering into possession of the premises, erected a building upon them making use of the wall which had been erected by the plaintiff.
    Upon an appeal from a judgment which decreed that an amount, fixed by an appraiser as the value of one-half of the wall, be a lien upon the premises owned by the defendant and that they should be sold to pay this amount:

      Held, that the agreement imposed a personal obligation upon Richards to pay to the plaintiff one-half of the value of the erection of the wall, and the conveyance of the property, subject to such agreement, created a charge upon it for the satisfaction of this obligation.
    That, as between Richards and the owner of this lot, the property was made the primary source of payment for the benefit of the plaintiff, and the latter was, by reason of the right of Richards to enforce this charge upon the land, entitled to bring- this action in equity for the enforcement of the charge in this manner created, and the satisfaction and payment of the amount due to him as the expense of building one-half the wall.

      Jumel v. Jumel (7 Paige, 591); Cox v. Wheeler (Id. 248); Belmont v. Coman (22 N. Y., 438); Dingeldein v. Third Avenue Railroad (37 id., 575); Hamill v. Gillespie (48 id., 556) followed; Cole v. Hughes (54 id., 444); Scott v. McMillan (76 id., 141) distinguished.
    That the defendant was personally liable for any deficiency which might arise on the sale of the land.

      Bedell v. Kennedy (38 Hun, 510) followed.
    Appeal from a judgment, in favor of the plaintiff, of the New York Special Term entered in the office of the clerk of the city and county of New York on the 22d day of May, 1888, and from an order made by a justice of the Supreme Court, entered on the 9th day of February, 1888, in the office of the said clerk, overruling the defendant’s demurrer, and from, an order resettling the above order made by the same justice on the seventeenth day of May and filed in the said clerk’s office.

      Edward Kaufman, for the appellant.

      Joseph Fettretch, for the respondent.
   Daniels, J.:

The complaint to which the demurrer was interposed set forth as the plaintiff’s cause of action the making of an agreement under seal between himself and William H. Richards, by which it was agreed that a division or party-wall should be built upon the line of land owned by these parties, on the westerly side of Eleventh avenue, in the city of New York, the wall to be erected equally upon the property of each of these persons. It was further agreed, as the plaintiff was about to erect the wall, that when Richards, his heirs or assigns, should make use of it, by the erection of a building upon his lot, there should be paid to the plaintiff, his heirs or assigns, one-half the cost of erecting the party or division-wall, and that this cost should be fixed or ascertained by two persons, one to be chosen by each party, or by a third party chosen by these two if they should be unable to agree. It was further agreed by the parties for themselves, their respective heirs and assigns, that the cost of repairing or rebuilding the wall should be borne equally by the owners of the respective lots, and that the agreement should be perpetual, “ and at all times be construed into a covenant running with the land, and that no part of the fee of the soil herein described and upon which, said party wall is inclosed, shall be transferred or conveyed in or by these presents.”

The plaintiff built the wall as he was authorized to do by the agreement, and Richards conveyed his adjoining lot to Newman Cohen. By the deed making the conveyance it was declared that it was “ subject also to a party-wall agreement made by John "W. Guentzer with the party hereto of the first part, dated May 9,1884, and recorded in said register’s office May 14,1884, in Liber 1193 of Conveyances, 253.” Cohen and his wife afterwards conveyed the same property to the defendant, declaring it to be conveyed “ subject to the said party-wall agreement hereinbefore referred to.” He entered into the possession of the premises and erected a building upon them, making use of the wall as he was entitled to do by the agreement. And the plaintiff thereupon served him with a notice in writing, requiring him to appoint a person to act with another selected by the plaintiff, to fix and determine the cost of the wall and the amount to be paid by the defendant for its use and appropriation to his building. .The defendant failed to make the selection of a person to act in this manner, and the amount was appraised by the individual selected by the plaintiff, fixing the value of one-half of the wall at the sum of $901.15. This sum the defendant refused to pay, and the plaintiff by his complaint demanded judgment that it might be decreed to be a lien upon the premises owned by the defendant, and that they should be sold to pay this amount, with interest and costs, and that the plaintiff should have such other or further relief as might be just.

The demurrer was served to the complaint upon the ground that it failed to state facts sufficient to constitute a cause of action. But as the complaint was considered at the trial to be sufficient, this demurrer was overruled. And a judgment was finally recovered adjudging this amount of money, with interest, to be a charge upon the defendant’s lot of land, and directing a sale of it, and out of the proceeds the payment to the plaintiff of the amount adjudged to be due and owing to him as the value of one-half the wall, and for the recovery of any deficiency against the defendant personally. It is entirely clear from the complaint that the agreement imposed a personal obligation upon Richards to pay to the plaintiff one-half the expense or value of the erection of this wall. And he, for his protection, when he conveyed his lot to Cohen, charged it with the duty and obligation of liquidating and discharging this indebtedness.' The obligation in this manner created could only be discharged to the plaintiff, and it is to be inferred from the acts of the parties that it was intended by them that it should be so performed by the grantee of the property. And the same intention actuated Cohen in making his conveyance to the defendant. It was to continue the imposition of the burden of this obligation upon the property, not only for the relief of Richards, but for the benefit and advantage of the plaintiff. And when real estate is in this manner conveyed the effect of the conveyance is to create a charge upon it for the satisfaction of the obligation provided for. (Jumel v. Jumel, 7 Paige, 591.)

And the property so charged becomes the primary fund or source of payment. And as between its grantor and grantee the former afterwards stands as a surety only for the payment of the indebtedness. This was held to be the law governing courts of equity in that case, and the case, of Cox v. Wheeler (Id. 248), supports the same principle. And it has since been sanctioned by the cases of Belmont v. Coman (22 N. Y., 438); Dingeldein v. Third Avenue Railroad Company (37 id., 575) and Hamill v. Gillespie (48 id., 556). Arid this obligation distinguishes this case from these of Cole v. Hughes (54 N. Y., 444) and Scott v. McMillan (76 id., 141). And as it placed Richards in the attitude of a surety for the extinguishment of the indebtedness, and, as between himself and the owner of his lot, that was made the primary source of payment for the benefit of the plaintiff, he was entitled, in equity, to bring this action for the enforcement of the charge in this manner created, and the satisfaction and payment of the amount due to him as the expense of building one-half the wall. (Pratt v. Adams, 7 Paige, 615.) Where the principle was stated to be that “it has been settled by a long-course of judicial decisions that, where a person, standing in the situation of indorser or surety, is furnished or provided by the principal debtor with a fund, or with collateral security for such a purpose, the creditor is, in equity, entitled to have it applied in satisfaction of the debt.” (Id., 621.) And by the conveyances which were made of the property the plaintiff seems to be so far within this principle as to entitle him to enforce the charge created in this manner against the land for the satisfaction of his demand. And the regular mode of satisfying the demand out of the land was to direct a sale of it, as the judgment has done in this instance, and the payment of the proceeds, so far as they may be necessary for that object, over to the plaintiff.

The case of Bedell v. Kennedy (38 Hun, 510) has gone even further than this, holding that a personal liability exists against the grantee of property acquiring title in this manner for the performance of a party-wall agreement. It is not necessary to consider whether that case is in harmony with the other authorities or not. It is a determination of this General Term, and sanctioned so much of the judgment as has provided for the recovery of any deficiency, after the sale of the land, from the defendant. And as long as this authority remains, as it still is, in legal force, it is required to be followed, and it supplies a sufficient support for the portion of the judgment sustaining this agreement as a personal obligation against the defendant.

To dispose of the case it is unnecessary to refer to any other of the authorities cited, for the judgment appears to be right, and it should be affirmed, with costs.

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

Judgment affirmed, with costs.