37*)- DECREE TRIAL OF TITLE AT LAW. trial of an issue of title which was determined Where a suit for injunction involved the both by a verdict and finding in favor of complainant, he will not be granted a final decree as against an application by defendant to have the issue of title tried at law.. [Ed. Note.-For other cases, see Injunction, Cent. Dig. § 85; Dec. Dig. § 37.*] the majority may be, has the right to secede | 2. INJUNCTION ( "The rules of law relating to freedom of action by independent churches and congregations are different from those rules which apply to congregations which are affiliated with and are subordinate to higher judicatories. Independent churches may do what they please with their property, provided legal action is taken to that end; but when a religious society becomes affiliated with other religious societies, and they unite to construct and maintain for their mutual advantage higher judicatories to which they subject themselves, then the individual society or worshipping unit holds its property and temporalities under an obligation to continue the affiliation until it can be broken by mutual consent; and if secession is attempted by a faction, however large or however small, such faction will not be allowed to carry the church property with it, certainly not so long as there is a loyal body which is recognized by the superior judicatory" (citing American Primitive Society v. Pilling, 24 N. J. Law, 653; True Reformed Church v. Iserman, 64 N. J. Law, 506, 45 Atl. 771; Pulis v. Iserman, 71 N. J. Law, 408, 58 Atl. 554; 24 A. & E. Ency. of Law, 354). I have therefore arrived at the conclusion that the original corporation was allied and affiliated with the Presbyterian denomination as a matter of fact, and that the members understood and believed that they were so connected, and that as a matter of law it was not competent for the seceding members of the congregation to appropriate to themselves the church property described in the two deeds hereinabove mentioned, and that the deeds should be declared to be null and void and the property restored to its former owner, the Magyar Evangelical Reformed Church of New Brunswick, N. J. I will advise a decree in accordance with these views. (83 N. J. Eq. 446) BLANCHARD v. NEILL. (Court of Chancery of New Jersey. July 30, 1914.) 1. APPEAL AND ERROR (§ 151*)- RIGHT TO WRIT "PARTY AGGRIEVED. A complainant who has received less than the relief demanded, or a defendant who has not been accorded the full amount of his set-off or counterclaim, is aggrieved by the judgment, and may sue out a writ of error to review the same, though it is in his favor. [Ed. Note.-For other cases, see Appeal and Error, Cent. Dig. §§ 147-952; Dec. Dig. § 151.* For other definitions see Words and Phrases, vol. 3, pp. 273-278, vol. 8, pp. 7569, 7570.] Suit by one Blanchard against one Neill. On application of complainant for final decree and of defendant for leave to try a question of title at law. Complainant's application denied, and defendant's petition granted. William A. Lord, of Orange, for complainant. E. L. Davis, of Orange, for defendant. EMERY, V. C. [1] So far as I have examined the authorities cited by complainant on the right of a party to bring writ of error on a judgment in his own favor, they are all cases where the judgment rendered, either for the plaintiff (appellant) on his claim or the defendant (appellant) on his set-off, and the judgment was less than the amount appellant claimed he was entitled to. In such cases the appellant is clearly "aggrieved" by the judgment in his favor. Parker v. Newland, 1 Hill (N. Y.) 87 (1841); Ingalls v. Lord, 1 Cow. (N. Y.) 240 (1823); Johnson v. Jobb, 3 Burr. (1772). In Capron v. Van Noorden, 2 Cranch, 126, 2 L. Ed. 229 (1804), the verdict and judgment was in favor of the defendant in error, not in favor of the plaintiff in error. [2] The right to a review by writ of error in the suit of the ruling of the trial judge against the defendant on the question of title is so doubtful that I do not think he should be required to pursue this remedy. But, if he does not do so, he must abide by the effect of this verdict and judgment as res adjudicata upon the matter of title, if it should be held to have this effect, and I have no right to require complainant to abandon this benefit of his suit, if he be entitled to it. Defendant should, however, in my judgment, be allowed to bring an action to settle the disputed question of title, in such manner as he may be advised, and this permission is given in order that an opportunity may be afforded to him of carrying the disputed question of title to an appellate court, if, notwithstanding the judgment, he still has that right. I do not consider that a permanent injunction settling the title, on the basis of the judge's ruling, should be granted without giving this opportunity, if defendant desires it. The action, however, should. be brought and prosecuted without delay. An order will be advised directing that the cause stand over until September 15, 1914, and that, if within 30 days the defendant commence an action at law against the complainant to settle defendant's disputed title and prosecute said action, then the defend *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes ant have a right to apply that the cause stand over to await the determination of said action, and, upon failure to bring the said action within said time and prosecute the same, that complainant have leave at said time to apply for final decree in this cause. HOWELL, V. C. The bill in this case is filed to recover the amount of loss under two fire insurance policies issued by the defendant. The first policy was issued to Andrew Dickey on August 27, 1906, and expired on August 27, 1909; it ran in the name of Dick Order may be presented for settling on Ju-ey, but there was attached a mortgagee clause ly 31st, unless agreed on. The purchaser of property covered by an insurance policy, providing that it should be void, unless otherwise agreed, if any change in the interest, title, or possession of the property took place, procured additional insurance, and after a loss, brought suit to reform the first policy by making it payable to him, instead of his grantor, and also asked a recovery on the second policy. Held, that the cause of action on the second policy was separate and distinct from that on the first policy and could be enforced only in the common-law courts. [Ed. Note.-For other cases, see Action, Cent. Dig. §§ 449, 451-468; Dec. Dig. § 46.*1 2. REFORMATION OF INSTRUMENTS (§ 16*) GROUNDS OF REFORMATION. An instrument in writing can be reformed only where there has been a mutual mistake, or a mistake on the part of one party and fraud on the part of the other. [Ed. Note. For other cases, see Reformation of Instruments, Cent. Dig. § 68; Dec. Dig. § 16.*] 3. INSURANCE (§ 143*)-REFORMATION OF POLICY-CHANGE OF BENEFICIARY. A purchaser of property covered by a fire policy, providing that it should be void if any change took place in the interest, title, or possession of the property, unless otherwise provided by agreement indorsed thereon or added thereto, who notified the insurer's agent of the change in title, but failed to obtain its consent, could not have the policy reformed after a loss by making it payable to him instead of his grantor; the policy having apparently been in prop er form at the time of its issue. [Ed. Note.-For other cases, see Insurance, Cent. Dig. §§ 265-272; Dec. Dig. § 143.*] 4. INSURANCE (§ 328*)-FORFEITURE-CHANGE OF TITLE OR INTEREST. Where a purchaser of property covered by a fire policy, providing that it should be void if any change took place in the interest, title, or possession of the property, unless otherwise provided by agreement indorsed thereon or added thereto, informed the insurer's agent of the change of title, but did not request the insurer to consent to the change, and the insurer neither assented thereto nor waived the condition, there could be no recovery on the policy. [Ed. Note. For other cases, see Insurance, Cent. Dig. 88 794-822, 825; Dec. Dig. § 328.*] Suit by John Plockzek against the St. Paul Fire & Marine Insurance Company. Decree for defendant. in favor of Andrew Crosson, mortgagee. On May 7, 1907, Dickey conveyed the land to the complainant. The complainant says that on June 12, 1907, he saw Mr. Pierce, one of the agents of the defendant company, and notified him that the property covered by the policy just mentioned had been conveyed to him; he says that he remembers the first time he saw Mr. Pierce was when he started to fix up the building, and when he had finished that work he went to Pierce & Watson's office and there saw Mr. Pierce and told him he wanted some more insurance on his property; that Mr. Pierce looked in a book and found that the current policy was in Mr. Dickey's name, and then and there he made application for $300 more insurance. A pol- . icy for that amount was issued to the complainant on October 25, 1907. That fact, taken in connection with the testimony of the complainant, leads me to believe that the first time he ever saw Mr. Pierce about the policies was about the date of the issuing of the junior policy. This policy ran to the complainant with the mortgagee clause in favor of Crosson. The complainant never saw and never had in his possession either of the policies. The evidence shows that the older policy was in the possession of Pierce & Watson, the agents of the company, it having been intrusted to them by the mortgagee, and put away in their safe with the mortgage. Matters stood in this way until the premises were destroyed by fire; then proofs of loss, which were apparently in proper form, were submitted to the insurance company, and nothing further appears to have been done until the filing of the bill in this case on March 22, 1910. The bill sets out the two policies and the circumstances under which they were issued, and the notice of the transfer of the title of the property from Dickey to the complainant, and prays that the older policy may be reformed so as to be made payable to the complainant instead of to Dickey, and that a decree may be made directing the defendant. to pay the full amount of both policies to the complainant. [1] I think it is quite apparent that the complainant can have no decree in this court on the junior policy; that was properly issued to the owner of the property, and if the company refused to pay, then the question as to whether the claim of the owner was just or not could be, and indeed would have to be, Thomas Brown, of Perth Amboy, and Free-litigated in the courts of common law. The man Woodbridge, of New Brunswick, for complainant. John H. Patterson, of Jersey City, for defendant. cause of action on the junior policy is a separate and distinct cause of action from the one accruing on the older policy. There is no *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes doubt but that the common-law court would permit a recovery on both policies in one suit, if they both stood on the same footing, but there is likewise no doubt but that a separate suit would be maintainable on each policy. I, therefore, am constrained to say that the complainant can have no relief in this court complainant can have no relief in this court on the junior policy, and as to that cause of action the decree will have to be in favor of the defendant. "I presume our firm had notice, but it didn't come to me personally direct, because I am always very particular to see that a transfer is made." ant was notified of the change of ownership, but that of itself would not be sufficient to maintain the validity of the policy under its but that of itself would not be sufficient to terms. By the terms of the policy the change of ownership invalidates the instrument, unless a note of the change is indorsed on or appended to the policy. This is part of the contract, and is appealed to by the defendant, and must therefore enter into the judg ment to be pronounced by this court. The requirement has not been met. I shall therefore assume that the defend. [2-4] The suit on the older policy stands in a somewhat different position. One of the prayers of the bill is that the policy may be reformed by inserting the name of the complainant in the place of that of Mr. Dickey as the person insured. It is a well-settled doctrine, which needs no citation of cases, ant upon the case of Milville Mutual Marine Much reliance was placed by the complainthat the reformation of an instrument in & Fire Insurance Co. v. Mechanics & Workwriting can be accomplished in this court in & Fire Insurance Co. v. Mechanics & Workonly two cases: (1) Where there has been a J. Law, 652. But there is a difference beingmen's Building & Loan Association, 43 N. mutual mistake; and (2) where there has been a mistake on the part of one of the par- that case the question was whether notice tween this case and that in this regard; in ties, with fraud on the part of the other. There is no evidence whatever before the of alienation was given to the company, and court which points in the direction of any whether the company assented to it or waivfraudulent action on the part of the defended the condition of the policy in this respect. ant or its agents; consequently if the complainant recovers, it must be on the ground of mutual mistake. The evidence, therefore, must be searched to ascertain whether the older policy was drawn or continued in the form in which it now appears, by the mutual mistake of the parties. Originally the policy ran to the owner of the fee, and it was apparently in proper form at the time of its issue. No question has arisen about its validity prior to the time of the transfer of the property to the complainant. The policy pro vides as follows: As I have said before, I find no evidence of waiver of the conditions; neither do I find any assent of the defendant to the alienation of the property insured; neither do I find that there was any request made by the complainant to the defendant for its consent to transfer is not sufficient. The mere oral assent of the corporation would make a doubtful case, in the face of the requirement that the consent shall appear in writing indorsed upon or annexed to the policy, yet in a given case the facts might warrant the conclusion of a waiver of the provision. the transfer of the title. Mere notice of The decree on the older policy must also be in favor of the defendant. & SONS CO. 1914.) (83 N. J. Eq. 479) 1. CORPORATIONS (§ 406*) - OFFICERS — AUTHORITY OF MANAGER-TRUST AGREEMENT. "This entire policy, unless otherwise provided by agreement indorsed hereon or added hereto, shall be void if *** any change other than by the death of an insured takes place in the interest, title or possession of the subject of insurance (except change of occupants without increase of hazard) whether by legal process or judgment or voluntary act of the insured or CUMBERLAND TRUST CO. v. B. S. AYARS otherwise." This provision is a part of the contract, (Court of Chancery of New Jersey. July 22, and must be enforced, unless there is evidence that its provisions have been waived by the defendant. I find no evidence of such waiver; therefore the clause thus quoted must stand as part of the contract evidenced by the policy. It is not claimed that there were any negotiations between the complainant and the defendant at the time complainant purchased the property in question, or at any time thereafter, so that there were no contract relations existing between the parties at all. The case, therefore, turns upon the conversation that the complainant says he had with Mr. Pierce, the agent of the company, in either June or October, 1907. The testimony is that at that time Mr. Pierce, the defendant's agent, was notified of the transmission of Dickey's interest to the complainant. He himself says: Where the entire business management of a corporation had been intrusted to A. without limitation, supervision, or restraint by the board of directors, the corporation would be bound by a trust agreement executed by him, the business to be transacted under it, by which executory in character, and operative alone on it was provided that the corporation would hold in trust and separate, for settlement of the account of petitioner, all goods unsold and all or other values received by the corporation for currency, open accounts, notes, liens, mortgages, the goods. [Ed. Note.-For other cases, see Corporations, Cent. Dig. §§ 1611-1614; Dec. Dig. § 406.*] 2. CORPORATIONS (8 406*)-CONTRACTS-VALIDITY-INSOLVENCY-RECEIVERS. manager of a corporation agreeing to hold in An agreement executed by the business trust and separate, for settlement of the ac *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes good faith. Even though count of petitioner, a creditor, all goods unsold, currency, open accounts, and other values received by the corporation for the goods, made in good faith, was valid and enforceable as against the corporation's receiver in insolvency. [Ed. Note. For other cases, see Corporations, to judgment creditors without notice and Cent. Dig. §§ 1611-1614; Dec. Dig. § 406.*] Suit by the Cumberland Trust Company against the B. S. Ayars & Sons Company. On petition to direct receiver in insolvency to deliver certain assets to J. E. Tygert Company. Application granted. D. O. Watkins, of Woodbury, for petitioner. James S. Ware, of Bridgeton, for respondent. LEAMING, V. C. [1] 1. I am satisfied that the authority of Arthur D. Ayars to execute the contract in question in behalf of the corporation represented by him has been sufficiently established. subsequent purchasers and mortgagees without notice (Smith v. Hotel Ritz Co., 74 N. J. Eq. 296, 77 Atl. 1135). The failure of the corporation to set apart cash received for goods sold (or to set apart the amount so received through a credit being given by a creditor in a settlement), standing alone, would be fruitful of no consequences other than to render it impossible for the cestui que trust to enforce the trust against the goods so sold because of the right to sell and collect having been bestowed upon the corporation or against proceeds of sales commingled with other funds of the corporation because of inability to identify the proceeds of sale as a specific object of the trust. AsIn practical operation the entire business suming that either the terms of the conmanagement of the corporation appears to tract or the course of dealings of the parties have been intrusted to Mr. Ayars without justifies the conclusion that payments or limitation, supervision, or restraint on the settlements in the manner referred to were part of the board; an inference of authoriza-authorized by petitioner, there is yet nothing tion coextensive with the scope of that man- to be found in the mere right or privilege agement cannot be properly resisted. The to make such settlements to warrant the instrument in question may be said to be unusual in character; but unlike a mortgage (Howell v. Keene, 59 N. J. Eq. 634, 43 Atl. 1070), or a warrant for confession of judgment (Stokes v. N. J. Pottery Co., 46 N. J. Law, 237), or cognovit (Raub v. Blairstown Creamery Ass'n, 56 N. J. Law, 262, 28 Atl. 384), it in no way fastened a lien on the prop-sibility of the trustee, and to that extent erty of the corporation. It was a purely executory contract operative alone on the business to be transacted under it. The power of the president to execute it in the name of the corporation may be sustained under the principles defined in Murphy V. Cane, 82 N. J. Law (53 Vr.) 557, 82 Atl. 854, Ann. Cas. 1913D, 643. conclusion that petitioner waived the right specifically defined in the contract to have funds so received by the corporation set apart or kept separate as objects of the trust. There can be little doubt that the trust provisions of such an agreement spring from want of confidence in the pecuniary respon they may be said to contemplate and provide against the danger of future financial disaster; but, as the conventional relation of trustee and cestui que trust are lawful, the rights arising from that relation must be protected by this court as long as that relation in fact and in law continues, and I am unable to conclude that the trust relation defined by the contract in question can be properly said to have been at any time terminated. I will advise an order pursuant to the prayer of the petition. (83 N. J. Eq. 536) [2] 2. It is undoubtedly true that if the real purpose of the contract was to make an effectual sale with no intent upon the part of the parties to give effect to the trust declared, and the latter provision can be said to have been merely an empty form to be operative only in case of disaster, petitioner cannot now enforce the trust provisions of the contract according to its terms; and a like consequence may be visited upon a waiver of the trust provisions. In re Harrington (D. C.) 212 Fed. 542. But I am unable to (Court of Chancery of New Jersey. July 25, reach the conclusion that the contract was not entered into in good faith or that its provisions have been abrogated by waiver. The stipulation contained in the agreement is that the corporation will hold in trust and separate for settlement of the account of petitioner all goods unsold and all currency, open accounts, notes, liens, mortgages, or other values received by the corporation for the goods. There can be no legal obstacle to such an agreement if made in MAYOR AND COUNCIL OF TOWN OF 1914.) 1. CONTRACTS (§ 10*)-WATERS AND WATER Where a contract by a water company to supply water to the inhabitants of a town provided that the town might purchase the works and "at any and all times" might inspect the books and vouchers of the company, the town was entitled to exercise such right of inspection, though it did not exercise its option to purchase; *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes [Ed. Note. For other cases, see Contracts, Cent. Dig. §§ 21-40; Dec. Dig. § 10;* Waters and Water Courses, Cent. Dig. §§ 277, 278; Dec. Dig. § 183.*] 2. EQUITY (§. 48*)-REMEDY AT LAW-CONTRACT RIGHTS ENFORCEMENT-INSPECTION OF BOOKS AND PAPERS OF CORPORATION. nor was it a valid objection that the inspection | In other words, one party to this contract has privilege was not mutual. a right which the other has not. The principle of mutuality cannot apply under these circumstances. The opinion of Chief Justice Gummere in Marvel v. Jonah, 90 Atl. 1004, which Mr. McCarter called to the court's attention upon argument and which was filed on July 17th last, deals with this subject with great clarity and is very much in point. See, also, Page v. Martin, 46 N. J. Eq. 585, 20 Atl. 46 (Errors and Appeals); Madison, etc., Association v. Brittin, 60 N. J. Eq. 160, 46 Atl. 652; Philadelphia Ball Club v. Lajoie, 202 Pa. 210, 51 Atl. 973, 58 L. R. A. 227, 90 Am. St. Rep. 627. Where a water company's contract with a town provided that the town at any and all times should have the right to inspect the water company's books and papers, the town was not limited to mandamus to enforce such right, but properly sought such relief by suit in equity. [Ed. Note. For other cases, see Equity, Cent. Dig. §§ 156, 158; Dec. Dig. § 48.*] Suit by the Mayor and Council of Town of Boonton against the United Water Supply Company. Decree for complainant. Frank H. Pierce and Charles E. Scribner, both of Boonton, and Robert H. McCarter, of Newark, for complainants. Elmer King, of Morristown, for defendant. LEWIS, V. C. This is an application by the town of Boonton for an inspection of the books and vouchers of the United Water Supply Company. This right is claimed under the terms of a contract made between complainant and Lewis Van Duyne and the Boonton Water Company. The defendant succeeded to the Boonton Water Company by purchasing all its property, including the contract with the town, at a sale in foreclosure proceedings. [2] I have given consideration also to the argument made by counsel for defendant that mandamus was the proper procedure for complainant in this issue; but I think that the action has been properly taken in the Court of Chancery, and that the remedy for the town is not as urged by counsel for the defendant. In the case of the State v. Elizabethtown Water Co., 89 Atl. 1039, which was cited, it was the statute that gave the State Water Commission the right to inspect the enforce the said right in a court of competent books of the water company. Proceedings to jurisdiction were provided for by the statute. The right in the case now before us arises out of the contract between the parties; in the Elizabethtown Case, the right to examine arose purely out of a legal statutory duty enforceable only in the Supreme Court by mandamus. No hardship is suffered by the water company by an order for inspection as such order can be so framed as to prevent the inquisitive but disinterested person or any competitor, if there be one, from coming to knowledge of the company's affairs. [1] From my examination of the case I have reached the conclusion that the relief prayed for by the complainant should be granted. There is no doubt in my mind that, read in connection with the other provisions of the contract, the words "at any and all times," which appears in paragraph 11, means that the water company bound itself to give the' inspection, even if the town did not exercise its option to purchase. The privilege, it appears, was incorporated in the contract to give Boonton a chance to know the true conditions before it should agree to exercise its option. This is frequently done where the public is concerned and is to be the purchaser. And it is no doubt true that 1. MORTGAGES (§ 244*)-ASSIGNMENTS-PRI without such right it would be difficult to get the people at large to sanction the making of a contract such as the one under consideration. There is, of course, consideration for the agreement to give this inspection as the town has been using the water supplied by the water company and paying for the same under the agreement, ever since it was exe cuted. The suggestion made by counsel for the defendant, that the relief should not be granted because there is a want of mutuality if this is done before the town exercises its option, cannot prevail in view of our decisions, and further this contract by its terms gives this right of inspection to the town authorities-a right not given to the company. In accordance with these views, an order for inspection may be entered. (83 N. J. Eq. 442) CLIFT et al. v. SCHEUTZ et al. (Court of Chancery of New Jersey. July 23, 1914.) ORITY. earlier in time of two assignments of the same Unless affected by the recording acts, the mortgage prevails. [Ed. Note. For other cases, see Mortgages, Cent. Dig. §§ 633-655; Dec. Dig. § 244.*] 2. MORTGAGES (§ 244*)-ASSIGNMENTS-PRIORITY-NOTICE. 690) § 54, providing that instruments which Under Conveyance Act (P. L. 1898, p. may be recorded under section 21 shall be void and of no effect against subsequent judgment creditors without notice, and against all subsequent bona fide purchasers and mortgagees, not having notice thereof, whose deed or mortgage shall have been first duly recorded, an assignee of a mortgage, to whom the bond and mortgage were not delivered, and who over a year before acted as attorney in a suit in which the interest of the mortgagee was attached in the possession of the holder of a *For other cases see same topic and section NUMBER in Dec. Dig. & Am. Dig. Key-No. Series & Rep'r Indexes |