MUTUAL LIFE INS. CO. OF NEW YORK v. COBB et al. (No. 45/413.)

No defense has been interposed against complainant's claim, and a decree has been advised in its favor. The controversy in the cause is between the executors of the Clark

1. EVIDENCE

1919.) 178(2)

DENCE CONTENTS OF WRITING. Secondary evidence of the contents of a written instrument can be received only when the writing containing or constituting the primary evidence of the fact to be proved is satisfactorily shown to have been lost or destroyed.

2. MORTGAGES 171(5)

--

FORECLOSURE CLAIM OF ALLEGED PRIOR MORTGAGEE PROOF.

-

In view of the recital of a mortgage record, requiring payment to be made in accordance with the conditions of a bond, it is incumbent on the surviving executors of the mortgagee to show that the debt secured by the mortgage is due according to the conditions of the bond, and is by such conditions payable to them out of the premises described in the mortgage, before they are entitled to enforce their claim for the amount of the mortgage against the present owner of the property and the administrator of their decedent's mortgagor in suit for foreclosure by another mortgagee; the record not being conclusive evidence of the amount owing on the mortgaged premises.

Suit for foreclosure between the Mutual Life Insurance Company of New York and Ursula J. Cobb and others, wherein certain defendants seek decrees, after decree has been advised for complainant, against other defendants. Decree denying the claim advised.

Day, Day, Smith & Slingerland, of Newark, for complainant.

Sidney W. Eldridge, of Elizabeth, for defendants Alfred H. Clark and others.

Jacob Steinbach, Jr., of Long Branch, for Ursula J. Cobb and others.

It appears that after Mr. Clark's death, and for some years prior thereto, his son, Wm. A. Clark, who was one of his executors, managed most of his affairs; that Mr. Clark had large interests and resided at various times in this state, in New York, and in Massachusetts. After his death, valuable papers and securities of his estate were found in various places, and it appears that Wm. A. Clark converted a large part of the estate, including money collected on mortgages, to his own use, and that at the time of the death of Wm. A. Clark about 1913 he had possession of most of the securities and other property of his father's estate.

The bond and mortgage from Smythe to Clark have never been in the possession of the surviving executors. These executors have never seen them, and did not know of their existence, and in fact knew nothing of them or of the indebtedness claimed to be represented by them until they were made parties to this action. Since then they have made search and have not been able to find either the bond or mortgage or anything relating to them, except the record of the mortgage in the Monmouth county clerk's office and possibly certain entries in Mr. Smythe's check stubs.

A certified copy of the mortgage has been offered in evidence, and the provision thereof recites that the mortgage and the bond mentioned therein are to cease and be void if Smythe or his heirs pay to Clark or his attorney, etc., "the sum of one thousand five hundred dollars in one year from the date hereof together with interest thereon at the

ants.

FOSTER, V. C. Complainant in this action seeks the foreclosure of a mortgage against property at Long Branch owned by Wm. J. Smythe, Jr., in his lifetime. In making search for the purpose of foreclosure, complainant's solicitors found unsatisfied of record a mortgage covering the premises in question, made by Mr. Smythe to Amos Clark of Elizabeth. This mortgage bears date April 19, 1892, and was duly recorded on April 27, 1892.

Complainant thereupon made Mrs. Cobb the present owner of the property, and also the administrator of Mr. Smythe who died in 1918, and the surviving executors of Amos Clark, who died about 1912, parties defend

ant.

iannually according to the condition of a certain bond made * * by Smythe to Clark bearing even date herewith drawn in the penal sum of $3,000."

The present owner and Smythe's administrator contend: (1) That the failure to produce the bond and mortgage raises the presumption that the debt due thereon has been paid; and (2) that it is not shown by Clark's executors that any payment has been made on account of the principal or interest of the debt since the date of the papers April 19, 1892, and that no demand for the payment of the same has been made for over 20 years. The representatives of the Clark estate contend that there is nothing to show that the debt secured by the mortgage has been paid in whole or in part; that there are check stubs, some of them in the handwriting of

Mr. Smythe, on which appear memoranda of payments of $45 to Amos Clark, for interest, from about the date of the mortgage to May 12, 1899 On the stub bearing this latter date the memorandum states that it is for interest to April 1, 1899, although the interest on the mortgage was not due by its terms until April 19th. A check for $45 was charged by the bank to Mr. Smythe's account on May 19, 1899. And it does not appear that Mr. Smythe was indebted to Mr. Clark on any other obligation.

The Clark estate contends that, while collection of the amount due on the bond may be barred by the statute, the mortgage has vitality by reason of the payment of the interest thereon as shown by the check of May 12, 1899, and that under the statute C. S. p. 3169, § 16, they as mortgagees have a right of re-entry for 20 years from that date, and that this period has not expired.

If for present purposes the check stub memoranda be regarded as showing a payment of interest on the mortgage to have been made within 20 years prior to the date of filing the bill, it then becomes necessary to determine if the Clark estate has established its claim for the principal sum of $1,500 with interest thereon from April 19, 1912, alleged to be secured by the mortgage in question.

[1] As stated, the bond and mortgage have not been produced, they were never in the possession of the surviving executors, were never seen by them or their existence known to them until the commencement of this action. After a search among Mr. Clark's papers and effects, they cannot be found, aside from the record of the mortgage. There is nothing to show that either the bond or mortgage was ever in existence or in Mr. Clark's possession. Two of the executors, although notified by their counsel, neglected to attend the hearing and to state what efforts they had made to find the papers. The attending executor testified he believed the amount due on the bond and mortgage had been paid to the deceased executor Wm. A. Clark, and that the Clark estate had secured a settlement from the deceased executor's estate for the moneys he had collected and converted to his own use. The Clark executors have attempted to prove their claim by secondary evidence under the rule that secondary evidence of the contents of a written instrument can only be received when the writing containing or constituting the primary evidence of the fact to be proved is satisfactorily shown to have been lost or destroyed. Smith v. Axtell, 1 N. J. Eq. 494; Johnson v. Arnwine, 42 N. J. Law, 451, 36 Am. Rep. 527.

At the hearing this rule was not strictly enforced, and the Clark executors were permitted to offer secondary evidence of the contents of the bond and mortgage as fully as if they had satisfactorily shown the papers to have been lost or destroyed. The

proof they offered consisted of the memoranda on the check stubs of Mr. Smythe and the certified copy of the mortgage, and the most they established by the check stubs was that apparently Mr. Smythe paid to Mr. Clark semiannually for about six years $45 for interest; but on what indebtedness does not appear, and from the copy of the mortgage it appears that Mr. Clark at the time the mortgage was recorded in April, 1892, had a lien of record against Mr. Smythe's property.

The recital in the mortgage record requires the payment of $1,500 in one year with interest, according to the conditions of a certain bond between the same parties; but there is nothing in the mortgage or in any of the proof to show the nature of the conditions referred to, or to show that in accordance with these conditions the sum mentioned in the record was to be paid in money only and not in some other way, and that it was to be paid in any event and under all circumstances.

[2] Inasmuch as the recital in the mortgage record requires the payment to be made in accordance with the conditions of the bond, it is incumbent on the Clark executors to show that the debt secured by the mortgage is now due according to these conditions, and is by such conditions payable to them at this time out of the premises described in the mortgage.

This they have not done or attempted to do. They ask, instead, that the court shall ignore that portion of the recital of the mortgage, requiring payment to be made in accordance with the conditions of the bond, and to accept the rest of the recital as establishing their claim.

To sustain this contention would require the court to assume that the conditions of the bond were of no importance and that they could not under any circumstances defeat the claim of the Clark estate; this would in effect require the court to make a new contract between the parties which it may not do.

On the assumption of the loss of the bond and mortgage, the Clark executors attempted to offer secondary evidence of the contents of the mortgage, but not of the bond; by surmise and presumption they assume that $1,500 is still due them from the property in suit and desire this property sold to satisfy their claim. Their proof does not measure up to the requirements of the situation; they have not shown that they are entitled to be paid the amount they claim out of this property, or any other amount.

To grant the decree they ask would be to hold that the purpose of our registry laws was to place upon the record conclusive evidence of the amount owing upon the mortgaged premises; and this notwithstanding the fact that the amount due on the mort gage might in course of time have been mate

rially reduced, or had large arrearages of interest due thereon. This is not the purpose of the registry laws. Bell v. Fleming's Ex., 12 N. J. Eq. 13-18.

The executors of the Clark estate have failed to establish the claim they assert against the premises in question, and a decree will be advised accordingly.

(90 N. J. Eq. 510)

session; on February 5th Joseph Kirschenbaum died intestate, and on March 5th Fannie Kirschenbaum applied for and was duly granted letters of administration upon his estate; complainants have presented their bill to both Newman and Fannie Kirschenbaum as administratrix, and both have refused to pay, although the administratrix has admitted that the debt is due; complainants are precluded from bringing action against Fannie Kirschenbaum as administratrix obtaining judgment and levying execuintestate, at which time the remedy provided for by the statute for attacking the sale by

(No. 46/311.)

1919.)

(Syllabus by the Court.)

1. EXECUTORS AND ADMINISTRATORS 431(2) -CREDITOR'S SUIT TO SET ASIDE SALE IN VIOLATION OF BULK SALES ACT-CONDITIONS PRECEDENT.

A creditor of a decedent's estate who has

presented his claim to the administrator has his debt fastened on his debtor's property so

that he may maintain a bill against the buyer and the estate of the vendor (the decedent) to set aside a sale alleged to have been made in violation of the Bulk Sales Act (P. L. 1915, p. 377).

2. EXECUTORS AND ADMINISTRATORS 437(2) -CREDITOR'S SUIT AGAINST ADMINISTRATRIX-TIME TO SUE-LEAVE TO SUE.

It appearing that, unless such a suit is maintainable, the creditor of a decedent will be deprived of all remedy under the Bulk Sales Act, leave will be granted under the provisions of section 65, Orphans' Court Act, 3 Comp. St. N. J. 1910, p. 3832, to maintain such a suit against the administrator prior to the expiration of the six months' immunity from suit granted to the administrator under such section. 3. FRAUDULENT CONVEYANCES -BULK SALES ACT.

241(2, 3, 5)

either at law or in equity, will have expired (the time limited by the act commonly called the Bulk Sales Act being 90 days from and after the date of the sale); Fannie Kirschenbaum is liable as administratrix to complainants, and they have no method of ascertaining whether or not she will be financially responsible when the time arrives when complainants may proceed against her at law;

Benjamin Newman is financially responsible, and complainants are precluded from proceeding against him at law because he did not contract the debt in question and because their right to proceed against him at law only arises after judgment against Fannie Kirschenbaum as administratrix and execution returned unsatisfied; the prayer of the bill is that a decree may be made declaring the said sale fraudulent and void and requiring the defendants, or one of them, to pay complainants' bill, and that a receiver be appointed to operate and manage the business until the amount of the debt is raised therefrom and for an injunction prohibiting defendant Newman from disposing of the

assets of the business.

The motion to strike is made by the administratrix, and the argument was con

Suit by Hugo Jaburg and another, copartners doing business under the firm name of Jaburg Bros., against Fannie Kirschenbaum, as administratrix, and others. On motion to strike the bill. Motion denied.

precludes an action at law or in equity against the administratrix within six months after the death of her intestate where the object of the action is to obtain a money judgment against the estate; and, second, that neither the Bulk Sales Act nor the statute of frauds can be available to complainants until

Joseph Steiner, of Newark, opposed.

LANE, V. C. The bill alleges that on January 13, 1919, Joseph Kirschenbaum was indebted to complainants in a certain sum for goods sold by them to him; on January 13th he sold a stock of merchandise and fixtures in bulk to Benjamin Newman; the proceedings were wholly in violation of the provisions of chapter 208 of the Laws of 1915, P. L. 1915, p. 377; Newman entered into possession of the property, and still is in pos

or's property by law or by judicial process. And upon the second point reliance is placed solely upon the opinion of Vice Chancellor Stevens in Muller v. Hubschman, 84 N. J. Eq. 30, 96 Atl. 189.

[2] The first objection may be disposed of by granting leave for the institution of the action as provided for in section 65 of the Act Concerning Orphans' Court, 3 C. S. of N. J. 3832. In view of the fact that complainants will be deprived of taking advantage of the provisions of chapter 208 of the Laws of 1915, P. L. 1915, p. 377, unless a suit of this

Without considering the question as to whether the objection secondly indicated, i. e., that complainants do not show that they have a lien upon the goods now in possession of Benjamin Newman, can be raised by the administratrix of the deceased debtor, I will pass upon its merits.

[1, 3] The present case, I think, is distinguishable from Muller v. Hubschman, 84 N. J. Eq. 30, 96 Atl. 189. In that case Vice Chancellor Stevens held that before a cred!tor can attack a sale made in violation of the Bulk Sales Act, chapter 208 of the Laws of 1915, he must have his debt fastened on the property, and that a general creditor prior to obtaining by judgment, execution, or otherwise, a lien upon the property cannot proceed by bill in this court. In that case the original debtor was living and there was nothing in the way of a proceeding at law against him, the obtaining of a judgment, and execution thereon. He held that the mere fact that the right of attack under the Bulk Sales Act was limited to 90 days was not, of itself, a ground for a different rule. The contention is made by counsel that Vice Chancellor Stevens indicated that it was a prerequisite that the creditor should have a judgment and based that contention upon the language of the Vice Chancellor at page 32 of 84 N. J. Eq., 96 Atl. 189. The Vice Chancellor did not so hold. At page 31 of 84 N. J. Eq., 96 Atl. 189, he quoted the language of the court in Graham Button Co. v. Spielmann, 50 N. J. Eq. 123, 24 Atl. 571, which is to the effect that a creditor must have his debt fastened on the debtor's property by law, judicial process, or some other way-quite a different proposition. I am forced to concede that this is the rule. Haston v. Castner, 31 N. J. Eq. 697. But the tendency of the courts is to limit the application of the rule where the interests of justice require, and this tendency is evidenced by adjudications that certain conditions may fasten the debt on the debtor's property other than judicial process. The injustice occasioned by a strict adherence to the rule is one not easily remedied by legislation, so the courts are left to work out a solution by themselves.

50 N. J. Eq. 120, 24 Atl. 571, affirmed 50 N. J. Eq. 796, 27 Atl. 1033. In Brockhurst v. Cox, 71 N. J. Eq. 703, 64 Atl. 1820, affirmed 72 N. J. Eq. 950, 73 Atl. 1117, Vice Chancellor Garrison held that a receiver of a partnership might, in the right of general creditors, attack a chattel mortgage. He based his conclusion upon the fact that, creditors being prevented from proceeding to judgment and execution, the receiver appointed by the court must, of necessity, represent them, and their debts must, of necessity, be considered as a charge upon the assets so as to give the receiver, in their right, a standing.

The Orphans' Court Act, § 65, 3 C. S. of N. J. p. 3832 et seq., contains a comprehensive scheme for the payment of debts of a decedent. Suits are forbidden against the representative, without leave of court, for a period of six months. If leave of court be given for the institution of a suit, execution cannot issue upon the judgment within the six months, so that, by operation of statute, the creditor is prevented from acquiring any lien upon the goods of decedent for a period of six months. The statute provides for the barring of creditors, presentation of their claims, passage upon the claims by the representative, and the payment of debts. It seems to me to be clear that, by force of this statute, the debts of the decedent are so fastened upon the assets of the estate, even if the estate be not insolvent, as that the creditors have a standing to contest a sale in fraud of creditors under the provisions of the Bulk Sales Act. Any other holding would result in denying relief in any case under the act to a creditor of a decedent. The goods, etc., alleged to have been sold in violation of the Bulk Sales Act, are considered for the purpose of the suit still a part of decedent's estate.

The argument that this court would be obliged to determine the amount of the debt due from the estate, properly determinable in a court of law, is not persuasive. That argument was answered by the Court of Appeals in Haston v. Castner, 31 N. J. Eq. at page 701. The fact that neither the existence nor the amount of a debt has been conclusively established at law does not prevent this court acting in aid of attachment. assume from the charges in the bill that the claim of the creditor has been properly presented to the administratrix. No point is

I

mitted the correctness of the bill. If necessary, there is no reason whatever why the cause in this court should not be held pending an adjudication as to the amount of the claim by the probate or law courts.

The motion to strike the bill will be denied. I have considered all of the points argued before me.

(93 N. J. Law, 29)

STATE v. SNOOK.

(Supreme Court of New Jersey. June 4, 1919.) 1. HOMICIDE 180-RECKLESS DRIVING OF AUTOMOBILE WHILE DRUNK-EVIDENCE. In a prosecution for manslaughter by reckless driving of an automobile while drunk, the state was properly allowed to prove the condition of all the occupants of the car as to sobriety.

was Mimmick. He had been one of the party in the car. On the morning after the accident he consulted with Hartman, and it is now urged that what he said was privileged. Mimmick was interrogated about it on crossexamination, and denied that he had made to Hartman statements contradictory to his testimony. Hartman was called by the state in rebuttal, and permitted to testify as to contradictory statements by Mimmick.

We agree with the trial judge that Hartman

In a prosecution for manslaughter by reckless driving of an automobile while drunk, admission of testimony of an attorney at law as to what was said to him after the accident by one of defendant's companions in the car, if erroneous, was not assignable by defendant; any privilege being personal to his companion.

3. WITNESSES 217-ATTORNEY AND CLIENT -PRIVILEGED COMMUNICATIONS.

The privilege protecting communications between attorney and client from being given in evidence by the attorney is personal to the client.

ney or counsel for Mimmick; but, even if he had been, the privilege was personal to Mimmick. He did not claim any privilege; and, even if there was error in admitting the testimony, it is not assignable by the plaintiff in error. The rule is thus carefully stated by Judge White, speaking for the Court of Errors and Appeals in State v. Loponio, 85 N. J. Law, 357, 360, 88 Atl. 1045, 1047 (49 L. R. A. [N. S.] 1017):

"Where, therefore, * legal advice of any kind is sought from a duly accredited professional legal adviser in his capacity as such, the communications relevant to that purpose,

Harry W. Snook was convicted of manslaughter, and he brings error. Affirmed. Argued February term, 1919, before the CHIEF JUSTICE, and SWAYZE and TRENCHARD, JJ.

John H. Kafes, of Trenton, and A. V. Dawes, of Hightstown, for plaintiff in error. A. Dayton Oliphant and James Hammond, both of Trenton, for the State.

SWAYZE, J. [1] The defendant was convicted of manslaughter. The claim of the state was that he caused the death of two persons by reckless driving of an automobile while drunk. The prosecutor was allowed to prove the condition of the occupants of the car as to sobriety. It is said that only the condition of the defendant was relevant. We agree with the trial judge that the evidence was admissible. It made it probable that the defendant himself was intoxicated and likely to be careless in his management of the car; and it was not too remote.

stance permanently protected from disclosure by himself, or by the legal adviser, or by the agent of either confidentially used to transmit the communications, except the client waives the protection."

The important words for our present question are, "at his instance."

The passage quoted enlarges somewhat on the language of Prof. Wigmore (Wigm. Ev. § 2292); and these words are dealt with by the learned author at section 2321. He there cites Baron Parke as authority for the proposition that the party cannot appeal because the privilege is denied the witness. Weeks v. Argent, 16 M. & W. 817. Baron Parke relied on a decision of Lord Denman in Marston v. Downes, 1 Ad. & El. 31. The reasons for the rule are stated by Wigmore at section 2196, together with cases pro and con. We think it a sensible rule. It is applicable where the evidence is admitted, since only the witness' rights are affected, but not applicable where the evidence is rejected, since in the latter case the party to the cause may be injured if legal evidence is improperly excluded.