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entered any time, upon ascertaining that it I could not be entered until that date, the officers could execute a new bond expressive of the understanding without further authorization from the directors.

2. SAME-INSOLVENCY - EXECUTION OF BOND -EVIDENCE-SUFFICIENCY.

Evidence held insufficient to show a bond was given by a corporation while insolvent or in contemplation of insolvency, within Corporation Act, § 64 (Laws 1896, p. 298, c. 185), making conveyance under such circumstances void, or that there was an intent to cheat, defraud, or give undue preference.

Bill by George J. Bergen, receiver, against John I. Rogers. Decree dismissing bill advised.

Wilson, Carr & Stackhouse, for complainant. Thos. P. Curley and John I. Rogers, for defendant.

GARRISON, V. C. (orally). A man named Hughes, located at Philadelphia, was the promoter of an enterprise which had for its general object the building of a trolley line from Philadelphia to Atlantic City. It was to run from Sixty-Third and Market streets, Philadelphia, to a point on the Delaware river opposite a tract of land in Gloucester county, in this state, called "Lincoln Park." The purpose was to transport passengers to this point on the Pennsylvania shore-the point being called "Dupont's Farm"-thence across or under the Delaware river to Lincoln Park, and along an almost straight line projected to Atlantic City, N. J. At the Atlantic City end it was intended to purchase a trolley which runs from Atlantic City to Pleasantville and to use its line and terminal for the ending of the route of this projected railroad scheme. The whole scheme was a vast one, involving millions of dollars. As links in the chain, there was to be purchased the Dupont farm, at about $7,500; a tract of land of some 30 or 35 acres, which was a disused amusement park on the river front known as "Lincoln Park"; the rights of way between the last-named place and the Pleasantville terminal of the trolley company above mentioned, and then that trolley line up Florida avenue to the Boardwalk in Atlantic City. Mr. Hughes interested John I. Rogers of Philadelphia in this undertaking, and Rogers was to put in $25,000 to go toward purchasing the trolley line at Atlantic City. Some negotiations in New York led to the information that at Florida avenue, in Atlantic City, at the terminus of this trolley line, the Lincoln Trust Company of New York had purchased a piece of property and contemplated erecting a pier for amusements, and that it was also prepared to purchase the trolley company in connection therewith; whereupon the Lincoln Trust Company became interested in this large scheme, and it no longer became necessary for Hughes and his associates to expend their ready cash for this Atlantic City Trolley Company. Thereupon Hughes disclosed to Rogers that he (Hughes) had rented

the Lincoln Park property from the Equitable Trust Company and had an option to purchase it. This park had been run for several years profitably, and then became unprofitable. The mortgage thereon, some $110,000, was foreclosed by the trustee, the Equitable Trust Company just mentioned, and had been bought in to protect the bondholders. It had been held for several years by the trustee, and finally this lease was made to Hughes for a nominal rent, some $1,800 a year, with the privilege to purchase for $60,000, of which $10,000 was to be cash and $50,000 was to be mortgage. Part of the general railroad scheme had been to turn in the Lincoln Park property to the railroad syndicate at $150,000, making a profit, as between those who turned it in and the railroad company of $90.000; they having to pay $60,000 for it, and getting $150,000 for it. Rogers, although up to that time believing or understanding that the Hughes corporation, the Lincoln Park Transportation Company, already owned Lincoln Park, was for the first time advised that this was not so. However, he consented to use

the money, which he had intended to use for the purchase of the Atlantic City rights, for the new purpose, namely, the purchase of the Dupont farm, and the purchase price, in cash, of the Lincoln Park property, plus some $5,000 additional which Hughes told him would cover all that had been incurred by way of expense at the park up to that time, making in all $15,000 at that time required, exclusive of the purchase price of the Dupont farm. In an agreement dated the 24th day of April, 1905, this matter is contained, and it was there agreed that Rogers was to advance $15,000, was to take a note at four months therefor, and was to have 1,700 of the 1,800 shares paid by the company to Veale as consideration money, and was to hold these 1,700 shares for himself and Hughes. The general purpose of all the parties at that time was to hold matters in statu quo until the railroad company was incorporated, and then turn in the park property and the Dupont property and get their profit.

The railroad scheme was delayed, and Hughes determined to open the park, and prior to opening the park he had made some improvements, repaired the pier, and had done some other work, and had, he said, incurred some $3,000 of expense in so doing. He thereupon went to Rogers and explained that it was not necessary to expend any money at present in the purchase of the Dupont farm, because they had that secured through an option, and that they need not now exercise the option and put up any cash; but that he did need $3,000, which was all, however, that he would need to clear up the situation at Lincoln Park; and he sug gested that Col. Rogers should advance the additional $3,000. This was done, making $18,000 of cash that Col. Rogers had put into the enterprise, and on the 2d of June various

contracts were drawn and resolutions were passed by the stockholders and directors of the Lincoln Park Transportation Company, which disclosed that the general scheme was as is about to be stated; Rogers not, however, acting as a stockholder, the stock which was to have been transferred to him still standing in the name of the original subscriber, Veale. Veale was the person who had purchased the property and turned it over to the Lincoln Park Transportation Company. The understanding referred to was that Rogers was to have a lien for the money that he advanced immediately after the first mortgage of $50,000. He was not to enforce his fien until the first of the succeeding October, unless some other creditor either threatened suit or actually brought suit, in which event he was to exercise his right to collect his money. The proper officers were duly authorized to execute a bond, with a warrant to confess judgment, in furtherance of the understanding just mentioned. The bond was drawn by Col. Rogers. He is a Pennsylvania lawyer, and it is the law of Pennsylvania that a bond may be entered at any time; but execution thereon may not issue until after the bond is, by its terms, due. It remains in the meantime, however, as a lien against real estate from the time of entry. Col. Rogers, assuming that the law of New Jersey was the same as the law of Pennsylvania, drew a bond for the $18,000, with interest to the 1st of October, payable on or before October 1, 1905, and this bond was duly executed by the officers and delivered. At that time there was not the slightest belief in anybody's mind, excepting Mr. Hughes, that the park, was to be operated as a separate entity. It had been theretofore wholly considered as a part of the general scheme. Afterwards Mr. Hughes determined to operate the park. He was the president of the Lincoln Park Transportation Company, and he constituted a man named Morgan general manager, and began operations at the park. The general nature of these operations was to have various amusement devices at the park and to transport people there for a consideration, and make what additional money could be made from them by their patronage of these devices and the restaurant and other things furnished for their entertainment and

accommodation.

When first opened, the park was not very successful, owing to bad weather, and, perhaps, bad management, excessive outlays for balloon ascensions and bands of music; but subsequently, by cutting out these expensive items, more money came in than went out for operation. In the latter part of July, propositions to lease the park to outside parties were made, and two such offers were considered by Hughes and all the parties interested. Upon these propositions being disclosed to Rogers, he suggested that no lease should be made which was not made in the

face of knowledge of his bond-in other words, that he should enter up his bond and thereby advise the lessee of his incumbrance and that the rent, instead of being paid to the company, should be paid to Rogers, under an agreement to be drawn, showing the trust relation of Rogers in the matter; his idea being that the rent should go first to pay the mortgage interest, the taxes, the interest on his loan, and other like fixed charges, before any should go to the company for its general purposes. At or about this time, and perhaps in connection with this matter, the bond, for the first time, was exhibited to New Jersey counsel, who immediately advised Col. Rogers that it could not be entered up, under the laws of New Jersey, before October 1st. Col. Rogers, thereupon, on the 26th of July, advised Mr. Hughes of this, and it was immediately agreed by all parties that this was not expressive of the agreement of June 2d; that it was the clear understanding that Mr. Rogers was to have a bond which could be entered up at any time, execution thereon not to be issued, however, unless suit was threatened or brought by somebody else; that he was to be secured by having a lien next to the mortgage; and that the company and its present officers would, of course, execute a bond in reformation of the bond of June 2d. Col. Rogers suggested the necessity, or desirability at least, of having an authorization by the board of directors of this new bond. He was told by Hughes that this was not necessary, but he persisted and Hughes consented. Two out of three members of the board (three being a quorum) attended on the morning that the bond was to be executed, July 28, 1905; but the third member did not appear, and no meeting was ever held of the board, and no actual authorization by the board of any new bond was ever had at a meeting. The minutes of a meeting evidencing authorization were drawn by Col. Rogers in the office of the company on the morning of the 28th of July, and, undoubtedly, the two members who were there assented; but it cannot be held, in view of our decisions, that the board of directors, as such, ever authorized this bond of July 28th. Whether or not the company ratified it by subsequent action I do not propose to consider, because I hold that the officers were authorized to execute this bond by the resolution of the board passed on the 2d of June, 1905; that they only did on the 28th of July what they had been previously authorized to do; that they only did that which a court of conscience would have required them to have done, and what they then did was done as of the 2d day of June; and that there was no fraud, no intention to cheat or defraud anybody, and no intention at that time to give any undue preference as of that time.

There is no doubt in my mind that Mr. Hughes is mistaken in his testimony that Col. Rogers at that time had any knowledge of

the general indebtedness of the company. The only knowledge that he is shown to have had was of the unpaid interest money due the Equitable Trust Company shortly before this time, or about this time, and, perhaps, some taxes. I do not think that there is any proof that Rogers had any knowledge of any other indebtedness of the company. He undoubtedly assumed that in the course of opcration there were, at times, unpaid sums of money; but he believed, and I think was justified in believing, that these were the slight items which occur in any business enterprise, and had no reason to believe that they were large. He had every reason to believe, from what he had been told, that his money had paid all the large items for improvements, etc. It is a fact that at that time the company had no ready money, excepting such as was coming in from day to day from the operation of the park, and it is also proved that by reason of Hughes' management he was not able readily to obtain boats. But it is not at all clear, in view of the decisions in this state, that the company was insolvent within the meaning of the sixty-fourth section of the corporation act (Laws 1896, p. 298, c. 185). Certainly there was no contemplation of insolvency, because the testimony of every witness is that they did not contemplate insolvency at that time. They were planning to run boats away into October; had numerous engagements for picnics and excursions, which were profitable to them, through the months of August and September; and had every prospect, so far as exceeding the operating expenses by the income was concerned, of a good season in that regard. Whether or not the net result would have been sufficient to have paid off the floating debt which subsequently was shown to have existed at that time must be left to conjecture.

On the afternoon of the same day that this bond was given to Col. Rogers, July 28th, he was brought in contact with one Thompson. Thompson was one of the parties heretofore spoken of who was seeking to lease the property. The other parties were referred to as "the Allentown people." In Hughes' view, it was better to deal with Thompson than with the Allentown people, because the Allentown people merely wanted to rent for five years at a set rental; whereas, he hoped that with Thompson he could effectuate a sale, and thereby get rid of the park, and pay all of the debts, and make the profit which they intended to make out of the park property, not by its operation, but by its sale, because all that they wanted of the park in their original undertaking was to use part of it as a terminal for the railroad; and in all of their talk of leasing or selling, it was definitely understood that an easement should be reserved by the company permitting the erection of terminals and the laying of tracks, etc., through the property. This meeting with Thompson took place on the

28th of July, and another meeting took place on the 1st of August. At this last meeting it was, for the first time, disclosed by Mr. Hughes to Mr. Rogers that there existed a large amount of floating indebtedness. I call it "floating indebtedness"-I mean indebtedness contracted by him in the management of the park property from about the 1st of July, when the park was opened. The bond dated July 28th was sent by Col. Rogers to his New Jersey attorney with instructions to enter the same, but not to issue execution without further instructions. The attorney on the 31st of July entered judgment on the bond, and, being informed on the next day by the clerk of Gloucester county, where the bond was entered, that a suit had been begun by one Horner for some two hundred odd dollars against the company, conceived that this was a situation in which he must protect the interests of his client, and, without consultation with Rogers, he instructed execution to be issued, and then left town for a vacation. This execution was issued on the 1st of August, or perhaps the 2d. The next day, when Col. Rogers learned of it, as he did by a letter from his attorney, he immediately, upon ascertaining that the attorney was away on a vacation, instructed the sheriff to hold the execution, and not to make a levy, and no levy was actually made for several weeks. In the meantime, the various schemes to lease fell through, and the attempts to borrow further moneys also fell through-I mean attempts to borrow by increasing the amount of mortgage-and the boat which they had been using was no longer obtainable by them without ready money, and the company on a bill filed on the 16th day of October, 1905, at the suit of H. W. Johns-Mandeville Company, complainant, was adjudged insolvent, and an injunc tion was issued and a receiver appointed. The bill in this suit to set aside the injunc tion of Col. Rogers was filed on October 30, 1905.

Finding, as I do, that the debt is an honest one, that the intention of the parties on the 2d of June was to give a bond which might be entered at any time, but no execution to issue until suit was threatened or begun, and that the action of July 28th was authorized by the company and related back to June 2d, in effect, I find there was no fraud and no contravention of the provisions of section 64 of the statute; and, furthermore, I do not find that the complainant has borne the burden of showing that this corporation was insolvent, or that the bond was given in contemplation of insolvency on the 28th of July, within the definition and meaning attributed to this language by our courts in dealing with it. Cogan v. Conover Mfg. Co., (Ct. Errors, 1905) 69 N. J. Eq. 815, 64 Atl. 973. I, of course, do not, in this case, deal with any questions arising out of the fact that Rogers is a stockholder of the company. If that stock was not paid for in full, or if,

as a stockholder, he is under any liability because he holds stock which is still assessable for creditors, those rights must be worked out in the insolvency case. Before he can obtain any benefit of this judgment, as against the receiver, or the assets in the receiver's hands (the property having been sold, and the lien transferred to the assets), he must, of course, petition in that proceeding. When he does so petition, any rights that the receiver has on behalf of creditors to assess Rogers on the stock, or to hold him liable in any way because of the fact that he is a stockholder, may be dealt with, and the rights of the receiver protected.

I merely hold in this action that the receiver has not shown that this bond was unauthorized, or that it was given in contemplation of insolvency, or that the company was insolvent within the meaning of the sixty-fourth section of the statute, and has not, therefore, shown that the judgment should be set aside.

I will advise a decree dismissing the bill.

(81 N. J. L. 430)

STATE v. HUMMER. (Court of Errors and Appeals of New Jersey. May 16, 1907.)

CRIMINAL LAW-APPEAL-GROUNDS OF RE

VERSAL-STATUTORY CONSTRUCTION.

The criminal procedure act (P. L. 1894, p. 246), as amended by Laws 1898, provides that, if it appear from the record in a criminal cause that plaintiff in error on the trial below suffered manifest wrong or injury either in the admission or rejection of testimony, whether objection was made thereto or not, the appellate court shall order a new trial. Held, that the phrase "admission or rejection of testimony" imports judicial action, and a judgment will not be reversed for refusal of the trial court to strike out testimony elicited by a question to which no objection was made.

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GARRISON, J. This is an application for a rehearing. The petitioner was convicted by the sessions of the crime of carnal abuse. This judgment was affirmed in the Supreme Court and afterwards in this court. The facts fully appear in opinions filed in each court. State v. Hummer (Sup.) 62 Atl. 388; State v. Hummer (Err. & App.) 65 Atl. 249. Upon one point the ground of affirmance was different in the two courts. In the Supreme Court the question put to the chief of police, viz., "There were other girls down there making charges against this man?" was vindicated as proper redirect examination; whereas, in this court we dealt with the denial by the trial judge of the motion to strike out this question after it had been answered, and sustained such denial.

The ground of the present application is that the plaintiff in error is entitled to have this court decide whether the question put

to the chief of police was legal or illegal, and, if illegal, to have the judgment of the sessions reversed.

In support of this contention, and as essential to its soundness, counsel construes the provision of the criminal procedure act that a new trial shall be granted "if manifest wrong or injury was suffered by the plaintiff in error in the admission of testimony" to mean that a criminal judgment must be reversed if any illegal testimony was admitted; that is to say, went to the jury. It is claimed that the testimony of the chief of police was in this sense "admitted," and hence that the judgment must be reversed if the question put to him was illegal, as counsel argues that it was.

In just what sense a question propounded to a witness can be said to be illegal, apart from any judicial ruling upon it, is not at all clear. Irrelevant a question may be in that it calls for irrelevant, and hence incompetent, testimony; but, in order that a question or its responsive answer should become illegal, it would seem to be essential that some legal right was invaded by its admission. Counsel, however, construes the statute differently, and contends, in effect, that a criminal judgment must be reversed whenever it appears that at the trial incompetent testimony went to the jury.

The same result must logically follow from this construction if such incompetent testimony be adduced by the defendant's counsel at the trial, or be acquiesced in by him, or even if it be given by the defendant himself upon the witness stand.

If any such rule is laid down by the statute, it is by force of its provision for reversal upon error: "If it appears from the record that the plaintiff in error on the trial below suffered manifest wrong or injury either in the admission or rejection of testimony whether objection was made thereto or not."

The meaning of this language is to be ascertained by the ordinary canons of construction.

The phrase "admission or rejection of testimony" clearly imports judicial action. No one but the trial court can reject testimony. Hence, as "rejection of testimony" must imply action by the court, the same sort of meaning is by the familiar rule to be given to the word "admission" as an associated term of precisely the same nature used in exactly the same context. That this is the correct construction of the word "admission" is placed beyond all doubt by the history of this legislative provision. As originally enacted (P. L. 1894, p. 246) this provision dealt solely with "rejection of testimony," which, as has been seen, necessarily imported action by the trial court. When, therefore, in 1898, the Legislature coupled with the word "rejection," that already had this imperative connotation, the correlated word "admission," it must be deemed to have used such added term in

view of the established meaning of the word with which it was thus associated. "The admission or rejection of testimony" thus importing judicial action, a consistent construction must be given to the qualifying words "whether objection was made thereto or not." Obviously judicial action upon testimony, if not called forth by any objection, must be of the court's own motion. Assuming therefore, but not deciding, that the legislative intention was to provide a scheme of spontaneous judicial interpositions during the reception of testimony at criminal trials, it must be held that the propriety of the exercise of such authority was in the first instance committed to the sound discretion of the judicial officers in whom such authority was reposed. Judicial dereliction in this regard would therefore come within the next clause of the statute touching matters of discretion to which bills of exception had or had not been allowed. Upon this assumption an appellate court would be authorized in the case of flagrant or oppressive abuse of this discretion, whether arising from the action or inaction of the trial court, to review such discretion and grant the relief contemplated by the statute. It is not, however, in the present case, necessary to decide this question or to pursue the inquiry as to such implied appeal to the discretion of the trial court, for the reason that, in the present case, an express appeal was made to such discretion which was dealt with in the opinion of this court in the light that was most favorable to the plaintiff in error.

Our conclusion, therefore, is that the construction of the statute advanced by counsel as ground for a rehearing does not commend itself to us, and that there is nothing in his argument that suggests that any right to which the plaintiff in error was entitled under the statute has not already been fully accorded to him. His present application must therefore be denied.

This same result might have been reached and justified by pointing out that no specification of causes for reversal raises the question that counsel has argued. The sole specification to which counsel points us, and the only one that at all touches the matter, is in these words:

"(4) That the court below erred to the prejudice and injury of the plaintiff in error by allowing Benjamin Murphy, a witness for the state, to be asked whether there were other girls than the prosecutrix making charges against the plaintiff in error, and to testify that there were."

The implied allegations of judicial error upon which this specification rests have no foundation in the record or in fact. The sole action of the court below in the premises was the denial of defendant's motion to strike out a certain question after it had been answered. This was not, as averred in the specification, “allowing the witness

to be asked the question," for that had already been done; neither, for the same reason, was it allowing the witness to answer such question, which is, in effect, the second averment.

It is too late now to inquire whether this specification even justified the consideration given in our opinion to the motion that was made at the trial by the defendant; but it is clear that such consideration, whether of grace or of right, was all to which the plaintiff in error was entitled. Without regard, however, to this matter of statutory practice, we have thought best to examine the present application upon its merits, and are constrained to deny it for the reasons already stated.

(73 N. J. L. 790)

CROSBY V. WELLS. (Court of Errors and Appeals of New Jersey. April 19, 1907.)

1. DEPOSITIONS-USE IN ACTION BETWEEN OTHER PARTIES-TRIAL-RECEPTION OF EVIDENCE - EVIDENCE OPINION EVIDENCE SUBJECT OF EXPERT TESTIMONY.

(a) When, by consent, there is read, at the trial of one action. the testimony of a witness out of the state, taken originally in another action, the propriety of a question and answer, part of the cross-examination in such other action, but really part of the examination in chief in the later action, is not to be tested by the strict rules of cross-examination.

So, too, in taking the testimony of such witness, under a notice by virtue of section 45 of the evidence act of 1900 (P. L. p. 375), the attorney of the adverse party, in questioning the witness, is not bound by the strict rules of cross-examination.

(b) In the circumstances of the case in hand, opinion evidence is that which is given by a person of ordinary capacity who has, by opportunity for practice, acquired special knowledge which is outside of the limits of common observation, and may be of value in elucidating a matter under consideration. The experiential qualifications of the witness, including his opportunity to observe the very thing under inquiry, being first shown, his special knowledge may be imparted at the trial in aid of the jurors under questions in ordinary form.

[Ed. Note. For cases in point, see Cent. Dig. vol. 20, Evidence, § 2357.]

2. SAME-DIRECTION OF VERDICT FOR PLAINTIFF FRAUD-SALES-RESCISSION.

A verdict may be directed for a plaintiff as properly as for a defendant, when any number of verdicts, if found otherwise than as ordered, would be set aside as without sufficient evidence to support them.

When, however, as to a right of rescission, there is evidence tending to show fraudulent representations of fact by the plaintiff, and, as to an actual rescission, evidence serving to show an offer, before suit, to return the thing previously delivered, which was promptly rejected by the plaintiff, there are questions on both heads to be submitted, under instructions, to the jury, and the direction of a verdict for the plaintiff is rightly refused.

[Ed. Note.-For cases in point, see Cent. Dig. vol. 46, Trial, § 391.]

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