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equity exists in favor of one whose debt was contracted prior to the issue, since he could not have trusted the company upon the faith of such stock. First. Nat. Bank v. Gustin M. C. Min. Co., 42 Minn. 327; Coit v. Amalgamating Co., 119 U. S. 347; Handley v. Stutz, 139 id. 435. It does not exist in favor of a subsequent creditor who has dealt with the corporation with full knowledge of the arrangement by which the "bonus" stock was issued, for a man cannot be defrauded by that which he knows when he acts. First Nat. Bank v. Gustin M. C. Min. Co., supra. It has also been held not to exist where stock has been issued and turned out at its full market value to pay corporate debts. Clark v. Bever, supra. The same has been held to be the case where an active corporation, whose original capital has been impaired, for the purpose of recuperating itself issues new stock, and sells it on the market for the best price obtainable, but for less than par (Handley v. Stutz, supra), although it is difficult to perceive, in the absence of a statute au

else, and the same right to insist upon its payment as upon the payment of any other debt due the company; that as regards creditors there is no distinction between such a demand and any other asset which may form a part of the property and effects of the corporation." This language is quoted and approved in County of Morgan v. Allen, 103 U. S. 508. It would seem clear that this is the correct statement of the law. The capital (not the mere share certificates) means all the assets however invested. If a subscriber gives his note for his stock that note is no more and no less a trust fund than the money would have been if he had paid cash down. Capital cannot change from a trust to not a trust by a mere change of form. It is either all a trust or all not a trust, and the "trustfund" rule, whatever that may be, must apply to all alike and in the same way. If the assets of a corporation are given back to stockholders, the result is the same as if the shares had been issued wholly or partly as a bonus. The latter is merely a short cut to the same result. So with dividends paid out of the capi-thorizing such a thing (of which every one dealing tal, voluntary conveyances, stock paid in overvalued property, all are forms of one and the same thing, all reaching the same result (a disposition of corporate assets), which may or may not be a fraud on creditors, depending on circumstances. This much being once settled, the solution of the question when a subsequent creditor can insist on payment of stock issued as paid up, but not in fact paid for, or not paid for at par, becomes, as we shall presently see, comparatively simple.

Another proposition which we think must be sound is that creditors cannot recover on the ground of contract when the corporation could not. Their right to recover in such case must rest on the ground that the acts of the stockholders with reference to the corporate capital constitutes a fraud on their rights. We have here a case where the contract between the corporation and the takers of the shares was specific that the shares should not be paid for. Therefore, unlike many of the cases cited, there is no ground for implying a promise to pay for them. The parties have explicitly agreed that there shall be no such implication by agreeing that the stock shall not be paid for. In such a case the creditors undoubtedly may have rights superior to the corporation, but these rights cannot rest on the implication that the shareholder agreed to do something directly contrary to his real agreement, but must be based on tort or fraud, actual or presumed. In England, since the act of 1867, there is an implied contract created by statute that " every share in any company shall be deemed and be taken to have been issued and to be held subject to the payment of the whole amount thereof in cash." This statutory contract makes every contrary contract void. Such a statute would be entirely just to all, for every one would be advised of its provisions and could conduct himself accordingly. And in view of the fact that "watered" and "bonus" stock is one of the greatest abuses connected with the management of modern corporations, such a law might, on the grounds of public policy, be very desirable. But this is a matter for the Legislature, and not for the courts. We have no such statute, and even if the law of 1873, under which the car company was organized, impliedly forbids the issue of stock not paid for, the result might be that such issue would be void as ultra vires, and might be cancelled, but such a prohibition would not of itself be sufficient to create an implied contract, contrary to the actual one, that the holder should pay for his stock.

It is well settled that an equity in favor of a creditor does not arise absolutely and in every case to have the holder of "bonus" stock pay for it contrary to his actual contract with the corporation. Thus no such

once rational The capital of It is a substi

with the corporation is bound to take notice), any dif-
ference between the original stock of a new corpora-
tion and additional stock issued by a "going concern.'
It is difficult, if not impossible, to explain or reconcile
these cases upon the "trust-fund "doctrine, or in the
light of them to predicate the liability of the stock-
holder upon that doctrine. But by putting it upon the
ground of fraud, and applying the old and familiar
rules of law on that subject to the peculiar nature of a
corporation and the relation which its stockholders
bear to it and to the public, we have at
and logical ground on which to stand.
a corporation is the basis of its credit.
tute for the individual liability of those who own its
stock. People deal with it and give it credit on the
faith of it. They have a right to assume that it has
paid in capital to the amount which it represents itself
as having, and if they give it credit on the faith of that
representation, and if the representation is false, it is
a fraud upon them, and in case the corporation be-
comes insolvent, the law, upon the plainest principles
of common justice, says to the delinquent stockholder:
'Make that representation good by paying for your
stock." It certainly cannot require the invention of
any new doctrine in order to enforce so familiar a rule
of equity. It is the misrepresentation of fact in stat
ing the amount of capital to be greater than it really is
that is the true basis of the liability of the stockholder
in such cases, and it follows that it is only those cred-
itors who have relied, or who can fairly be presumed
to have relied, upon the professed amount of capital,
in whose favor the law will recognize and enforce an
equity against the holders of "bonus" stock. This
furnishes a rational and uniform rule, to which famil-
iar principles are easily applied, and which frees the
subject from many of the difficulties and apparent in-
consistencies into which the "trust-fund doctrine
has involved it, and we think that, even when the
trust-fund doctrine has been invoked, the decision in
almost every well-considered case is readily referable
to such a rule.

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It is urged however that if fraud be the basis of the stockholders' liability in such cases, the creditor should affirmatively allege that he believed that the bonus stock had been paid for, and represented so much actual capital, and that he gave credit to the incorporation on the face of it; and it is also argued that, while there may be a presumption to that effect in the case of a subsequent creditor, this is a mere presumption of fact, and that in pleadings no presumptions of fact are indulged in. This position is very plausible, and at first sight would seem to have much force, but we think it is unsound. Certainly any such rule of pleading or proof would work very inequitably

in practice. Inasmuch as the capital of a corporation is the basis of its credit, its financial standing and reputation in the community has its source in, and is founded upon, the amount of its professed and supposed capital, and every one who deals with it does so upon the faith of that standing and reputation, although as a matter of fact he may have no personal knowledge of the amount of its professed capital, and in a majority of cases knows nothing about the shares of stock held by any particular stockholder, or if so what was paid for them. Hence in a suit by such creditor against the holders of "bonus" stock he could not truthfully allege, and could not affirmatively prove, that he believed that the defendants' stock had been paid for, and that he gave the corporation credit on the faith of it, although as a matter of fact he actually gave the credit on the faith of the financial standing of the corporation, which was based upon its apparent and professed amount of capital. The misrepresentation as to the amount of capital would operate as a fraud on such creditor as fully and effectually as if he had personal knowledge of the existence of the defendants' stock, and believed it to have been paid for when he gave the credit. For this reason, among others, we think that all that it is necessary to allege or prove in that regard is that the plaintiff is a subsequent creditor, and that if the fact was that he dealt with the corporation with knowledge of the arrangement by which the "bonus" stock was issued, this is a matter of defense. Gogebic Inv. Co. v. Iron Chief Min. Co., 78 Wis. 427. Counsel cites Fogg v. Blair, supra, to the proposition that the complaint should have stated that this stock had some value, but that case is not in point, for the plaintiff there was a prior creditor, and as his debt could not have been contracted on the faith of stock not then issued, he could only maintain his action, if at all, by alleging that the corporation parted with something of value.

In one respect however we think the complaint is clearly insufficient. The thresher company is here asking the interposition of the court to aid in enforcing an equity in favor of creditors against the stockholders by declaring them liable to pay for this stock contrary to their actual contract with the corporation. While the proceeding is not, strictly speaking, an equitable action, yet the relief asked is equitable in its nature. Under such circumstances it was incumbent upon the thresher company to show its own equities, and that it was in a position to demand such relief. It was not the original creditor of the car company, but the assignee of the original creditors. By that purchase it of course succeeded to whatever strictly legal rights its assignors had, but it is not rights of that kind which it is here seeking to enforce. Under such circumstances we think it was incumbent upon it to state what it paid for the claims, or at least to show that it paid a substantial and not a mere nominal consideration. The only allegation is that it paid "a valuable consideration." This might have been only $1. It appears that it bought the claims after the car company had become insolvent, and its affairs were in the hands of a receiver; also that the indebtedness of that company amounted to about $3,000,000, and that there were not corporate assets enough to pay any considerable part of it. The mere chance of collecting something out of the stockholders does not ordinarily much enhance the selling-price of claims against an insolvent corporation. If any person or company had gone to work and bought up for a mere song this large indebtedness of the car company for the purpose of speculating on the liability of the stockholders, no court would grant them the relief here prayed for. It would say to them: "We will not create and enforce an equity for the benefit of any such speculation." Counsel for respondent suggests that the thresher com

pany is but an organization of the original creditors, who formed it and pooled their claims, so as to save something out of the wreck of the car company, but nothing of the kind is alleged. On this ground the demurrer should have been sustained.

In view of further proceedings it may be proper to say that in our opinion there is nothing in the position that the right of recovery against the stockholders was barred by the statute of limitation. The argument in support of the proposition all rests upon the false premise that the cause of action accrued in May, 1882, when the bonus stock was issued. The corporation never had any cause of action against these defendants. As between them and the company, the agreement for the issue of the stock was valid. The creditors are not here seeking to enforce a right of action acquired through or from the corporation, but one that accrued directly to themselves or for their benefit, and that did not accrue at least until the corporation became insolvent in May, 1884.

Counsel for the St. Paul Trust Company stated that, if the court should reverse the order appealed from on any of the grounds urged by the other appellants, it would not be necessary for us to consider any of the assignments of error peculiar to his appeal, but as we reverse upon a ground that may be remedied by amendment, we deem it proper to say that, in our opinion, the claim against the Kittson estate is a "contingent" claim within the meaning of the General Statutes of 1878, chapter 53.

Order reversed.

GILFILLAN, C. J., took no part.

NEW YORK COURT OF APPEALS AB-
STRACTS.

ASSESSMENTS-RECOVERY BACK-NECESSITY TO SET ASIDE ASSESSMENT-JUDGMENT IN FAVOR OF ONE TAX

PAYER-EFFECT ON OTHERS.-(1) Money paid under a street assessment, illegal, but not void for jurisdictional or constitutional reasons, cannot be recovered until the assessment is set aside. Horn v. Town of New Lots, 83 N. Y. 101; Purssell v. Mayor, 85 id. 330; Strusburgh v. Mayor, 87 id. 452; Bruecher v. Village of Port Chester, 101 id. 240; Jex v. Mayor, etc., 103 id. 536; In re Delancey, 52 id. 80; Wilkes v. Mayor, 79 id. 621; Chase v. Chase, 95 id. 373. (2) A judgment vacating a street assessment against one land-owner does not vacate assessments under the same law 364. Second Division, Jan. 20, 1892. against others. Reid v. City of Albany, 128 N. Y. Trimmer v. City

of Rochester. Opinion by Follett, C. J. 9 N. Y. Supp. 695, affirmed.

CREDITORS

PREFERENCES

ASSIGNMENT FOR FRAUD-APPEAL.-(1) Where an assignment states the debt due one of the preferred creditors at "about $12,000," consisting of "accounts and notes which assignors are unable to describe," and the inventory filed by the assignors twenty days later itemizes the said accounts and notes so as to make the principal of the entire debt just $12,000, and the amount due, including interest, $13,501, the two instruments, construed together, constitute a direction to the assignee to prefer the claim of such creditors to the amount of $13,501. (2) A provision in an assignment preferring a certain creditor in the sum of $13,501, when the amount due him is only $12,658, avoids the entire assignment, although the assignor intended to act in good faith. (3) Where a suit to set aside a general assignment as fraudulent is brought by one judg ment creditor on behalf of himself and all other creditors who may desire to join in the suit, attaching creditors, who are made parties defendant, and who

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BANKS-COLLECTIONS-PROOF OF HANDWRITING.-(1) To relieve a bank from liability to refund money paid to it for the account of its principal through fraud or mistake, it must have actually paid over the same to the principal, and the giving the principal credit for the amount on the bank's books is not sufficient. (2) A draft for $12.50, drawn on plaintiff by a correspondent, was raised to $5,000, and as so raised, cashed by plaintiff upon defendant's presenting it indorsed for collection. Held, that upon discovery of the fraud, plaintiff could recover from defendant the amount paid to it less $12.50 unless the signature of the drawer was also a forgery; and that the fact that the genuine signature of the drawer had been touched up a little with a brush or quill, but not essentially altered, did not constitute it a forgery. (3) The testimony upon the part of defendant to show that the signature of the drawer of a draft was a forgery was that of experts, who were unfamiliar with the signature, and who only testified from scientific tests, and a comparison of the signature with those acknowledged to be genuine, and from the appearance of the signature of the draft in question. On the other hand, the drawer himself, and various persons who had seen him write, and were familiar with his signature, all swore that in their opinion the signature was genuine. Held, that a finding in favor of the genuineness of the signature would not be disturbed, and that the fact that the drawer had written a letter in reference to his signature, in which he did not express himself in as positive terms as he did as a witness, in no way discredited his testimony. Dec. 22, 1891. United States Nat. Bank v. Nat. Park Bank of

New York. 13 N. Y. Supp. 411, affirmed, without opinion.

BONDS-OFFICIAL-WITHDRAWAL OF SURETY.- (1) Notice of withdrawal by a surety upon a deputy sheriff's bond does not discharge such surety until a reasouable time has elapsed to enable the sheriff to secure a new bond for such deputy. Bostwick v. Van Voorhis, 91 N. Y. 363; Barnard v. Darling, 11 Wend. 29; Andrus v. Bealls, 9 Cow. 693; Hart v. Brady, 1 Sandf. 626; Hunt v. Roberts, 45 N. Y. 696; Burgess v. Eve, L. R, 13 Eq. 450; Hough v. Warr, 1 Carr. & P. 151; Hassell v. Long, 2 Maule & S. 363, 370; Calvert v. Gordon, 3 Man. & R. 124; De Col. Guar. (2d ed.) 346; Fell Guar. (2d ed.)530. (2) One month after such notice is not, as matter of law, an unreasonable length of time to allow a sheriff in which to secure a new bond. Feb. 9, 1892. Reilly v. Dodge. Opinion by O'Brien, J. Gray, J., dissenting. 14 N. Y. Supp. 129, affirmed.

BOUNDARIES - ADVERSE POSSESSION. - Plaintiff's predecessor in title, through mistake as to the true boundaries of land purchased by him, built his fence so as to include other land of his grantor not conveyed by the deed. The land so inclosed was occupied and cultivated by plaintiff and his predecessor as a homestead for more than forty years. Section 372 of the New York Code of Civil Procedure provides that "for the purpose of constituting adverse possession by a person claiming title not founded on a written instrument the land is presumed to have been possessed and occupied * * * (1) where it has been protected by a substantial inclosure; (2) where it has been usually cultivated and improved." Section 368 provides that such possession for twenty years will overcome the presumption in favor of the owner of the

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legal title. Held, that plaintiff had a good title by adverse possession. Dec. 1, 1891. Eldridge v. Kenning. Judgment affirmed on opinion below. 12 N. Y. Supp. 693, affirmed, without opinion.

BROKER-COMMISSIONS-WHEN EARNED.-Where it

appears, in an action for commissions under a contract for the exchange of real estate, that the owner stated to the broker that if the exchange were made he would pay a commission, there is no error in the charge that ordinarily, where a broker is employed to negotiate a sale or exchange of land, the law is well settled that when the broker brings to the vendor a buyer who is willing to purchase on the vendor's terms, and the vendor is satisfied to accept him as purchaser, the broker has earned his commissions. Knapp v. Wallace, 41 N. Y. 477. Second Division, Feb. 12, 1892. Kalley v. Baker. Opinion by Follett, C. J. 8 N. Y. Supp. 851, affirmed.

CONTRACT-AGREEMENT TO PAY WHEN ABLE-PAROL EVIDENCE.-(1) In settlement of an action by plaintiffs against defendant and another for a balance due on a joint account of the latter, to which they had interposed a defense, and of an account between plaintiffs and defendant individually, on which a balance was due to him, the accounts were liquidated, and a balance against him was stated, which he promised to pay "when I shall be able to do so." Held, that an action for such balance was not an action on an account stated, but an action on the conditional promise of defendant, which promise was founded on a valuable consideration, and that in order to recover plaintiffs must show some change for the better in defendant's circumstances after the promise was made. (2) The only evidence as to the defendant's ability to pay was that at the time of making the promise, and since then, he received a salary as judge, monthly, out of which he saved nothing, and it was not shown that in any respect his circumstances had improved. Held, that ability to pay within the meaning of his promise was not proved. (3) One of the letters written by defendant to plaintiffs, and relied on by them as containing the agreement between the parties, referred to de| fendant's promise to pay him when able as "in accordance with our agreement on Saturday last." Held, that parol evidence tending to prove what was the entire agreement was admissible. (4) It being essential to plaintiffs' cause of action that they should show defendant's ability to pay, evidence was not admissible to show what he could have paid from his salary after defraying his personal expenses, or why he did not devote any portion of the difference between his salary and his individual expenses to pay plaintiff's claim. Dec. 23, 1891. Work v. Beach. 13 N. Y. Supp. 678, affirmed, without opinion.

CONTRACTS-TERMINATION-BREACH.- (1) Plaintiff contracted with a switch and signal company to become its general manager for $5,000 per year, also giving it the exclusive right to use all his inventions relating to the signal business for $3,000 per year in addition, together with ten per cent of its net profits, the contract to continue ten years, subject after two years to termination by either party on one year's notice, or by the death or incapacity of plaintiff, and in the event of the termination of this agreement the said company (by reason of the expenditures that shall have been made during the continuance of this agreement) shall have a license (not exclusive) to use all of the inventions that may have been used in carrying on the business of the company, on the payment of $6,500 per year." Held, that the contract was not "terminated" so as to bring into operation the latter provision, by the discharge of plaintiff without cause, and no suit could be maintained for the $6,500 royalty. (2) The effect of the stipulation relating to the termination of

the contract was only to give the company an option to continue using the inventions on paying the $6,500 royalty, and in the absence of an exercise of the option the royalty would not become due. (3) An admission by the company's president, on plaintiff's discharge, that they would pay the royalties, would not bind the company in the absence of evidence that he was authorized to make such promise, or to put such a construction upon the contract. Jan. 20, 1892. Johnson v. Union Switch & Signal Co. Opinion by Earl, J. O'Brien and Peckham, JJ., dissenting. 13 N. Y. Supp. 612, affirmed.

CORPORATIONS -FAILURE TO FILE CERTIFICATEPERSONAL LIABILITY-INCREASED STOCK.-Under the General Manufacturing Act (Laws 1848), making the individual stockholders of a company liable for a failure of the company to file a certificate showing that its capital stock has been paid up in full, where it appears that such certificate of the original issue of stock has been filed, and that there was a subsequent issue of increased stock, no liability for want of a certificate with respect to such increase can attach to a member of the company until it is proved that he is holder of a part of the increased stock. Jan. 20, 1892. Griffith v. Green. Opinion by Gray, J. 13 N. Y. Supp. 470, affirmed.

CRIMINAL LAW-MALICIOUS MISCHIEF EVIDENCE.Upon a trial for the unlawful and willful destruction of property, it was proved that the property in question (a boat) had been destroyed by defendant in order to keep it off from a pond belonging to his father; that the father had repeatedly removed the boat from the pond, whereupon it had each time been put back by the owner of the boat; and that defendant had been placed in charge of the pond by his father, and directed to keep the boat from trespassing on the pond. Held, that the question whether defendant had any reasonable cause for the destruction of the boat should have been left to the jury. Feb. 9, 1892. People v. Kane. Opinion by Gray, J. Earl, C. J., and O'Brien, J., dissenting. 15 N. Y. Supp. 612, reversed.

DAMAGES-EVIDENCE-LOSS OF EMPLOYMENT.-In an action by a father to recover expenses incurred in nursing his infant daughter, who was injured through defendant's negligence, it was error to allow him to testify that in order to nurse his daughter, he was obliged to abandon an engagement as theatrical manager at a salary of $50 a week. Although it was not so stated upon the trial, the plaintiff now insists that this evidence was not offered for the purpose of effecting a double recovery, but as a circumstance to show his pecuniary situation, and his dependence on his profession for support, at the time he undertoook to become the nurse of his child. But what bearing did the resources of the plaintiff have upon the actual worth of his daughter's services, or the amount that it cost him to cure her? How could dependence upon his avocation for support increase the pecuniary value of her services, or the amount necessarily incurred in caring for her? The rule governing the assessment of damages in such a case as this is compensation for pecuniary loss, and the amount of that loss is not affected by the financial condition of the person sustaining it. The accidental circumstance that the loss may at the time bear more heavily upon a poor man than a rich man cannot swell the amount that the person causing that loss is legally responsible for. While the plaintiff

was entitled to recover the value of his services as a

nurse, he was not entitled to recover in addition thereto what he might have made if he had not abandoned his business engagement. He could not recover for services rendered during a specified period, and for loss of time during the same period. He was entitled to have his pecuniary loss, necessarily caused by the

accident, made good to him. This included the services of a nurse as long as a nurse was needed, and if the plaintiff saw fit to act in that capacity, he was entitled to the value of his services in that capacity. But if he abandoned a more lucrative occupation in order to act as nurse, the value of his services while engaged in that occupation could not properly be considered by the jury in estimating the value of his services while acting as a nurse. His services as a nurse were worth no more because he was able in some other calling to earn a large income. If his time had been worth $50 a day as the manager of a theatrical company, he would have been worth no more as a nurse than if he had had no other occupation except that of nursing. Second Division, Feb. 12, 1892. Barnes v. Keene. Opinion by Vaun, J. 10 N. Y. Supp. 957, reversed.

DEED-COVENANTS RUNNING WITH THE LAND.-(1) A deed of premises conveyed "a right of way" between "the south line and a line drawn parallel with the north side" of a certain store, "said lane not to be occupied or built upon by either party." The store referred to was owned by the grantor, and bounded the lane, which from its north line to the side of the store was sixteen feet wide. There was a hatchway projecting five feet into the lane, leading into the cellar of the store, and over it a pulley and hood. Held, that a finding that the "north side of the store" did not mean the north side of the hatchway should be ises with a right of way over an adjoining lane, sustained. (2) A covenant in a deed of certain premsaid lane not to be incumbered or built upon by either party," is a covenant running with the land, and such covenant is not restricted by the use of the words "either party" to the actual parties to the deed, but applies equally to subsequent grantees. Second Division, Jan. 26, 1892. Dexter v. Beard. Opinion by Parker, J. 7 N. Y. Supp. 11, affirmed.

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HIGHWAY-DISCONTINUANCE-ADVERSE POSSESSION. -Where a public alley is closed up and held by open and notorious possession for more than twenty years, the abutting property-owners lose the right to maintain an action for obstructing it. Suell v. Levitt, 110 N. Y. 595; Washb. Easm. (4th ed.) 718; Yeakle v. Nace, 2 Whart. 123; Abendroth v. Railway Co., 122 N. Y. 1-14; Lansing v. Smith, 8 Cow. 146; Wend. 10; Wood Nuis. 655. Second Division, Feb. 9, 1892. Woodruff v. Paddock. Opinion by Follett, C. J. 9 N. Y. Supp. 381, affirmed.

INSURANCE-POWERS OF AGENT-PAYMENT OF PREMIUM.-(1) On May 12 plaintiffs, desiring to insure their premises, applied to N., who had possession of blanks issued by defendant company, but no written appointment from it, and N. made out the application and forwarded it to defendant's agent in a neighboring town, who acknowledged the receipt and stated that he would advise N. as soon as he heard from the company; that the risk was a special one, which he could not accept without the company's approval. About May 18, defendant's agent was notified that the company declined the risk, but omitted to so inform N. until after a loss, which occurred on June 6. The premium for the insurance had been previously paid to N. by plaintiffs, but N. had not remitted to defendant's agent. At that time N. informed plaintiffs that the policy would be all right. Held, that defendant was not liable. (2) As N. had no power to bind the company, as plaintiffs knew, the payment of the premium to him did not render defendant liable. Second

Division, Jan. 26, 1892. More v. New York Bowery Fire Ins. Co. Opinion by Brown, J. 10 N. Y. Supp. 44, reversed.

LEASE RENEWAL-COVENANTS.-A lease contained a covenant by the lessors that they, prior to the expiration of the term, would pay to the lessees the value

of the buildings erected by the latter on the premises, or would grant them a renewal lease containing like covenants. Held, that such renewal lease need not contain a covenant for payment for buildings or further renewal. Dec. 22, 1891. Leary v. Hutton. Judgment affirmed on opinion below. 12 N. Y. Supp. 476, affirmed, without opinion.

MECHANICS' LIENS-CONTRACT - MATERIAL-MENJURISDICTION OF COUNTY COURT-AMENDMENT.—(1) A contract for the erection of a building provided that a certain payment should be due "when the plastering was finished." The contractor abandoned the job, leaving the hall and parlor without their last coat of plaster, and the stairs, under which there should have been plastering, not put up. Held, that there was such a substantial failure to complete the plastering that the payment was not due. (2) At the time one who had supplied materials to the contractor filed his lien, there was nothing due the contractor, who afterward willfully abandoned the job before any money became due him, since the filing of the lien; but the owner under a provision of the contract permitting him to do so, completed the building according to the contract for less than the contract-price. Held, that the lien attached to the extent of the difference between the cost of completing the building and the amount unpaid on the contract when the lien was filed. Follett, C. J., dissenting. (3) Where suit is begun in the County Court, whose jurisdiction is limited to $1,000, to foreclose a lien for $1,670, by service of a summons which does not show what the action was brought for, the court has jurisdiction to allow the complaint to be amended so as to demand less than $1,000, and to render judgment according to such amended prayer. Second Division, Feb. 9, 1892. Van Clief v. Van Vechten. Opinion by Vann, J. 8 N. Y. Supp. 760, modified.

MUNICIPAL CORPORATIONS-CONTRACT WITH WATER COMPANY. (1) After the granting by town authorities of an application for the privilege of supplying the town and its inhabitants with pure and wholesome water, the water company, duly incorporated, entered into a contract with the town to erect water-works, and lay in the principal streets twenty-three miles of pipe, "for the purpose of supplying the town and its inhabitants with pure and wholesome water," to erect two hundred fire hydrants, to be used only for fire purposes, and to erect two pumps of a certain capacity, fixing a maximum rate for private consumption. Held, that such contract should be construed as one to furnish a supply of water, and not as one for the erection of water-works merely, and was valid. (2) The fact that the commissioners of highways, who signed the contract on the part of the town, were to be paid by the company for their services in directing and supervising the laying of the pipes, it not appearing that such agreement had any influence in procuring the contract or in the method of its execution, the terms being fair and just on both sides, and the compensation reasonable, and such services not being required of them by law, will not vitiate the contract. Jan. 20, 1892. Nicoll v. Sands. Opinion by Peckham, J. 14 N. Y. Supp. 448, affirmed.

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TRUSTEES.—(1) Under Laws of 1854, chapter 352, providing that the trustees of the village of Canandaigua shall be commissioners of highways for the village, with powers to regulate, repair, etc., the streets and walks, it is the duty of the trustees to repair the sidewalks, and the village is liable for injuries occasioned by their failure to do so. (2) Notice of the defect to one acting as street commissioner, and admitted of record to be such by the village, whose duty it was "to examine the streets and sidewalks," though not de jure such officer, is sufficient to charge the village.

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RAILROADS-REORGANIZATION-REISSUE OF STOCK -RIGHTS OF BONDHOLDERS.-The bondholders of a railroad company authorized defendants, as trustees, to purchase the road and property on foreclosure, and to organize a new corporation, and divide the stock among the bondholders in proportion to the amount of bonds held by each. Defendants formed a company with a capital of $2,000,000, under a charter which provided for the completion of the road. The laws of Kentucky, under which the road was reorganized, only allowed the issue of paid-up stock to the amount of the original cost of the road, and such sum as might be necessary to complete the same. Defendants issued paid-up stock to the amount of the accrued cost of the road, $994,000, to the bondholders, and retained the residue for the completion of the road, instead of distributing the same among the bondholders as demanded by plaintiff. Held, in the absence of evidence of bad faith on the part of the trustees, that the residue of stock in question was properly retained, and that an injunction against the transfer of the road should have been denied. Jan. 20, 1892. White v. Wood. Opinion by O'Brien, J. 13 N. Y. Supp. 631, reversed.

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SALE-GOOD-WILL-"CARRYING ON SAME BUSINESS -BREACH.-An agreement by defendant, on sale of the stock and good-will of a plant for making zinc etchings, that he will not enter into the same line of business in any way or manner whatever, is not violated by engaging in the electrotyping and stereotyping business and supplying occasional demands for zinc etchings from customers by procuring them from makers not connected with defendant. Jan. 20, 1892. Breck v. Ringler. Opinion by Earl. J. 13 N. Y. Supp. 501, reversed.

TENANTS IN COMMON--FORECLOSURE-PARTITIO FRAUD.-(1) Where tenants in common, who are in possession of the land, and in receipt of the rents and profits, induce the holder of a mortgage for much less

than the value of the land, to foreclose, and they buy in the land at the foreclosure sale for the amount due on the mortgage, they will be decreed to hold the title so acquired in trust for themselves and for their cotenants, who were not in possession. (2) Tenants in common, who institute partition proceedings, and buy in the property themselves at partition sale, do not, when the proceeding is regularly conducted, hold the title so acquired in trust for themselves and their cotenants, even though the latter are minors. Feb. 9, 1892. Carpenter v. Carpenter. Opinion by Andrews, J. 12 N. Y. Supp. 189, reversed.

TRUSTS -APPOINTMENT OF NEW TRUSTEES. (1) Where overdue notes are assigned by the owner upon the express agreement that the assignee shall collect the notes if possible, or if they are uncollectible, shall obtain new notes in their place, and shall give the proceeds or the new notes to a third person, the assignee holds the notes and their proceeds in trust for such (2) Upon the filing of a petition showing person. prima facie that a deceased person held certain personal property in trust for the petitioner, it is proper to appoint a new trustee, even though the existence of the trust be denied by the administrator, since such appointment does not prevent the administrator from denying the existence of the trust when afterward called upon by the new trustee to deliver the trust estate. Feb. 2. 1892. In re Carpenter. Opinion by Andrews, J. 15 N. Y. Supp. 817, reversed.

VENDOR AND PURCHASER--SPECIFIC PERFORMANCE -TITLE-RECITAL IN DEED-RES ADJUDICATA.-(1) In

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