the contributions were as stated by the testimony of Mr. Vanneman, who heard Daniel Bittle make admissions in conversation, which came in an entirely natural way, to the effect that Daniel had contributed but $550 and Benjamin had contributed $1,250 of the purchase money. It thus appears that their contribution to the purchase money on this piece of land was in unequal proportions. There was no agreement between Daniel and Benjamin as to their several interests in the purchase, nor any arrangement whereby the one who contributed the most agreed that the other should equally share with him in the purchase. In such cases, unless the parties stand to each other in the relation of parent and child, or husband and wife, the law raises a presumption called a "resulting trust," whereby each party holds a share in the property purchased according to his contribution to the purchase money. The result of the transaction was that, when these brothers thus purchased the land in question, Daniel had an interest in it as $550 stood to $1,250, which latter amount Benjamin contributed to the purchase, and that sum represented Benjamin's share. There is no testimony showing that this arrangement was in any way changed. No conveyance or declaration of trust, or of their several interests, affecting the property, took place between them.

There is some proof which favors the defendants' contention that the brothers held in equal shares the property purchased. The fact that the deed was made to both generally is some evidence of that, and so is the charging of taxes, etc., by Benjamin against Daniel's estate in equal portions. But as to the effect of the deed, the proof is that these brothers, though contributing to the purchase in the proportions named, and evidently intending to own the property in those proportions, were very ignorant men, and it is hardly to be believed that they could or did understand the legal effect of a deed to joint grantees. So the charging of taxes, etc., in Benjamin's account, is of some force to show that they held in equal shares; but this is merely inferential proof, and ought not to be held to overcome the uncontradicted showing of the truth that the parties in fact purchased and paid for the property in the shares and proportions above mentioned, and that they have never since in any way ar ranged a division of either the land or the profits thereof as equal owners each of onehalf part.

The payment of the proportionate shares of the purchase money by the several parties being established beyond dispute. a resulting trust assigning to each a quantity of interest in proportion to his payment arose. and should have effect, unless some definite act of the parties is proven, which establishes by equally forceful evidence some change in their relations to the property, whereby each was to hold a different share.

The defendant insists that they arranged that each should hold an equal half part; but this testimony does not effectively prove his claim. The defendant Herbert I. Clement bought Daniel's share at the executor's sale with full notice that Daniel's interest was in the proportion as $550 stands to $1,250, those being the sums contributed by Daniel and Benjamin, respectively, for the purchase of the property. The defendant Clement is equitably entitled only to that proportion which Daniel would have been entitled to had he been the defendant in this partition.

The result is that a sale should be ordered, and that the proceeds over and above the payment of the mortgage and costs should be divided in the proportion that $550 stands to $1,250. That is, the defendant Clement should have 11/36 parts and the complainant, Benjamin Bittle, 25/36 parts of the net proceeds of the sale.

There is a matter which appears in the orphans' court account of Benjamin as executor of Daniel Bittle, as to the disposal made of the rents of Daniel's lands since his death, and before his executor made sale of them. Rents accruing after the death of a decedent, and before the exercise of a power of sale, go with the title to the land to the heir or devisee, and not to the executor, or to the purchaser under the power. These rents appear to have been accounted for in the executor's account. There are also credits in that account which ought not to be there. The matter is of small importance, and has not been raised in argument, and can probably be settled without further controversy in this case.

I will advise a decree as above indicated.

MONMOUTH COUNTY ELECTRIC CO. ▼. CENTRAL R. CO. OF NEW JERSEY et al.

(Court of Chancery of New Jersey. Feb. 13, 1903.)

MORTGAGES-AFTER-ACQUIRED PROPERTY

LIEN-PRIORITY.

1. Where a corporation, after giving a mortgage covering existing and after-acquired property, which was duly recorded, placed poles and wires belonging to it on the land of another by agreement with him, the mortgage was a lien prior to any claim of the landowner.

Suit by the Monmouth County Electric Company against the Central Railroad Company of New Jersey and another. Decree for complainant.

L. M. Garrison, for complainant. J. L. Conover, for defendants.

EMERY, V. C. At the hearing of the cause my conclusion was announced, that the complainant, as purchaser at foreclosure sale (or the grantee of such purchaser), was entitled to be subrogated to the rights of the mortgagee in the foreclosure suit, to the ex

tent claimed; that is, the amount paid by the purchaser at the sheriff's sale ($250,000). This seemed to me then to be the clear effect of the decisions from Parker v. Child, 25 N. J. Eq. 41, and Chilver v. Weston, 27 N. J. Eq. 439, to Boorum v. Tucker, 51 N. J. Eq. 135, 149, 26 Atl. 456; Pettingill v. Hubbell, 53 N. J. Eq. 584, 32 Atl. 76. I do not change my views upon further consideration. The question reserved was whether the mortgage was a lien, prior to any claim of the defendants, upon poles and wires erected upon defendant's property subsequent to the execution of the mortgage, by an agreement between the mortgagor company and defendant. The mortgage covered all existing and after-acquired property of the mortgagor company, and was duly recorded before the execution of the agreement between the mortgagor company and the defendant. Under the agreement, the poles and wires were erected on defendant's lands, and, as I construe its effect, they were the property of the mortgagor company, and they still remained its property at the time of the foreclosure. The mortgage expressly covered all after-acquired property, and under our decision the mortgage is, in equity, a iien upon these poles and wires afterwards acquired, which is prior to mortgagee or judgment creditors subsequent in date to the mortgage. Smithurst v. Edmunds, 14 N. J. Eq. 408 (Ch. Green, 1862), approved McFarland v. Stanton Mfg. Co., 53 N. J. Eq. 650, 33 Atl. 962, 51 Am. St. Rep. 647 (Err. & App.); Cumberland Nat'l Bk. v. Baker, 57 N. J. Eq. 231, 40 Atl. 850 (V. Ch. Grey, 1898). The defendants have no lien upon this after-acquired property, either by the agreement or otherwise, and have only the right to purchase it at a valuation, or to require its removal on the termination of the agreement, which has already expired.

There must be a decree in favor of the complainant, requiring defendants to redeem or be foreclosed.

1. Act Feb. 16, 1891 (P. L. p. 24), providing that judicial sales of land should be confirmed notwithstanding irregularity in the publication of the notice of sale, when the officer making the sale certifies under oath that the sale was otherwise regular, and for a fair price, and the court is satisfied that the interests of the parties were not injuriously affected by the irregularity, was not repealed by Act June 14, 1898 (P. L. p. 535), amending the acts approved March 25, 1874, and March 17, 1887, relating to publication of notices of sales of land under judicial proceedings, and changing the publications required.

2. The act of 1891 (P. L. p. 24) was not a mere validating act, applicable to past sales only, but in providing that "all sales" made

by order of any court "shall be confirmed" plainly refers to future sales.

3. Where a sheriff's sale is required to be confirmed by the court, he cannot require the purchaser to accept a deed until confirmation has been obtained.

Petition by Abraham V. D. Polhemus, sheriff, for decree to compel John B. Priscilla to accept deed and complete his purchase at a sheriff's sale. Denied without prejudice.

Alan H. Strong, for petitioner. Willard P. Voorhees, for respondent.

EMERY, V. C. On this application I reach the following conclusions:

1. The act of February 16, 1891 (P. L. p. 24), directing confirmation of sales by the court in cases like the present, was not repealed by the act of June 14, 1898 (P. L. p. 535), amending the previous acts of 1874 and 1887, relating to publication of notices of sales of lands. The act of 1891 was not an amendment to the sales act, but was intended to apply only to that class of cases in which, by previous statutes or practice of the court, confirmation of the sale by a court was necessary. The only statute requiring this was the statute relating to bonds and mortgages and foreclosure sales of March 12, 1880 (P. L. p. 255; Gen. St. p. 2111, § 4), and perhaps sales in partition in chancery or orphans' court. The statute of 1891 did not at all extend to or cover that large class of public sales upon which no confirmation by court is necessary. This statute was, therefore, one of special application, and did not repeal the previous provisions of the general acts of 1874 and 1887 as to sales of land. Neither was it repealed by the subsequent general act of 1898, changing the publications required. The statute of 1891 can be read in connection with the act of 1898, and both made effective. Thus read together, the statutes still require the sheriff to make advertisement according to the law of 1898, but, if there is a defective advertisement, then, if the sale is one which is subsequently to be confirmed by the court, the court may, under the conditions prescribed by the act of 1891, confirm the sale, notwithstanding the defect in advertisement. The claim that the act of 1891 was repealed by the act of 1898 is, for these reasons, not sustained.

2. The act of 1891 is not a mere validating act, applicable to past sales only. The language of the act plainly refers to future sales. "All sales made by virtue of any order, judgment, or decree of any court of record of this state, shall be confirmed by the court," etc. It is certainly prospective, whether or not it be retrospective. The plain language covers sales that are to be thereafter confirmed, and without limiting the confirmation to sales previously made. The act is not an act to validate sales, but an act concerning defective advertisements. There is nothing in the title or act to indicate that the adver

3. See Judicial Sales, vol. 31, Cent. Dig. § 59.

tisements concerning which the statute legislates were past advertisements. I think, therefore, that the present case is within the act, and the petitioner is entitled to the benefit of it.

3. The only relief I can give the sheriff on this petition is to have the sale confirmed under the act of 1891. The respondent was not bound to accept a deed until a confirmation under this act had been made, and a deed tendered after confirmation. The right of the sheriff to proceed to specific performance is based on the fact, and only on the fact, that he has fully complied with his duty as an officer executing a statutory power, and thereby is entitled to call on the purchaser to complete the sale upon his part. It may be, however, that the parties have raised on this application all the questions intended to be raised, if a deed should be tendered after confirmation under the act of 1891; and, if so, I may, by consent of the purchaser, now order the acceptance of the deed after confirmation, with the same effect as if a tender had been made after confirmation. If he does not consent, the present application will be denied, except as to the confirmation of the sale, but without prejudice to a renewal of the application on tender of the deed after confirmation of sale.

COLUMBIA COUNCIL, NO. 77, JR. O. U. A. M., OF MATAWAN, N. J., v. BELMAR BUILDING & LOAN ASS'N. (Court of Chancery of New Jersey. Feb. 13, 1903.)

BUILDING AND LOAN ASSOCIATIONS-FORGED CERTIFICATES OF STOCK-RECEIPT OF PAYMENTS-ESTOPPEL TO DENY MEMBERSHIP. 1. One who held a forged certificate of stock in a building association, and also valid certificates, made payments of dues on them all to the association's secretary, who had issued the forged certificate, and who had no authority to receive payments for the company. The secretary turned the money over to the treasurer, who was ignorant of the existence of the forged certificate, and who, supposing the payments to be made on the valid certificates, credited them thereon as advance payments, which, under the by-laws, were allowable. The treasurer was the only officer entitled to receive payments for the association. Held, that the association was not estopped to deny membership by virtue of the forged certificate.

Bill by Columbia Council, No. 77, Jr. O. U. A. M., of Matawan, against the Belmar Building & Loan Association, to establish membership in the association. On bill, answer, replication, and proofs. Bill dismissed.

J. C. Conover and A. E. Arrowsmith, for complainant. Frank Durand, for defendant.

EMERY, V. C. Complainant's counsel have not submitted any briefs, and the cause will not be held any longer for them. The complainant has no claim for membership in the association based on the forged certificate itself, and the only question in the cause is

whether the receipt of dues by the defendant from the complainant took place under such circumstances as to estop the defendant from denying membership under the forged certificate. The dues which were paid included the regular payments upon valid shares held by the complainant, as well as paynients upon the shares represented by the forged certificate. The treasurer of the company, to whom the payments were turned over by MacDermott, the secretary, who is sued the forged certificate, had no knowledge that the payments were made on these forged certificates, and credited the entire payments to the account of the valid shares, taking them to be payments in advance. Under the by-laws there was nothing to prevent payments in advance, as the payments (article 13, § 3) were to be made "on or before" certain days fixed. No payments were ever credited to the account of any shares represented by the forged certificates. Under these circumstances, no estoppel to deny the validity of the forged shares, or the right to membership based on them, can arise. Membership, in such case, could be rested only on the ratification of the illegal issue by receiving payments thereon, and the consequent estoppel against subsequently denying membership as the effect of the payments and receipt. But ratification of a previous illegal or unauthorized act never arises, unless the act claimed to be a ratification is done with knowledge of the previous invalidity or irregularity, or of the facts from which they result. The treasurer in this case was the only officer entitled to receive the payments for the company; and even as suming that he had authority, by their mere receipt, to ratify an illegal or void issue of certificates (which I do not intend to decide), the payments made on the fraudulent shares were by him intended to be received and were received and credited as payments on the valid shares, and without knowledge on his part of the existence of the forged shares. There was, therefore, no ratification by the company, and no estoppel to deny the validity of the certificate can arise. The payment by complainant on account of the shares represented by the forged certificate was actually made to MacDermott, who was the secretary of the company. He undoubtedly knew of the forgery, for he was the person who issued the certificate to complainant. But as secretary he had no authority to receive the payments for the company, and the payment to him by complainant for the purpose of turning over to the treasurer must be considered to have been made to him as the agent and for the convenience of the complainant, and it was at complainant's, and not defendant's, risk, that the payments were turned in by MacDermott, and credited by the treasurer as payments made on the valid shares only. The company cannot be held in this case as estopped, by MacDermott's dealings with com

plainant, from denying the validity of the shares.

The bill of complainant seeking to establish its membership by virtue of this forged certificate and its alleged payments thereon must be dismissed. The dismissal, however, will be without prejudice to any action which the complainant may have at law for the repayment of the amounts paid on the forged shares or otherwise.

(64 N. J. E. 259)

RILEY V. FITHIAN et al.

(Court of Chancery of New Jersey. Jan. 23, 1903.)

EQUITY-PLEADING-BILL-TRUSTEE-TERMS OF TRUST-DILIGENCE-COSTS.

1. In an action by a trustee to recover trust property alleged to have been wrongfully obtained by the defendant parts of the bill narrating the origin and terms of the trust and the parties thereto should not be stricken out as immaterial.

2. An allegation in the bill in an action to recover property of which complainant claims to have been defrauded that he consulted his counsel as to the transactions, and directed his counsel to investigate the facts to enable him to take legal steps for relief, should not be stricken out, as it tends to show diligence and explain delay, and is not prejudicial to the defendant.

3. The insertion, in a bill by a trustee to recover trust property, of a copy of a letter written by complainant's counsel to defendant hefore suit, stating counsel's views as to the legal basis of complainant's claim, and suggesting an "adjustment without recourse to the courts," is proper, as being matter for consideration in the allowance of costs.

Action by Franklin Riley, trustee, against Francis R. Fithian and others. Motion to strike out parts of bill.

Refused.

Clement H. Sinnickson and W. A. Logue, for complainant. E. A. Armstrong and David J. Pancoast, for defendants.

GREY, V. C. (orally). This matter may be presently disposed of, as the elaborate arguments of counsel on both sides have fully discussed every view which may be taken of the points in dispute. The bill of complaint is filed by a trustee, who devotes the first 12 or 13 pages of the bill to a definition of the origin and character of his trust. The principal defendant is Francis R. Fithian, who is alleged on the face of the bill to have been the agent of the complainant, whom he employed to sell the trust property. The other defendants are parties claimed to have been associated with Mr. Fithian in the doing of the acts alleged to be wrongful. The bill alleges that the trustee employed the defendant Fithian to effect a sale, and charges that he and those he associated with him have wrongfully retained part of the trust property, and have sold and retained the profits of another part; that these acts were concealed from the complainant (trustee), and have resulted in great loss to the trust estate. The trustee complainant states the

details of the transactions so far as they have come to his knowledge, and asks a disclosure of all the incidents whereby the title of the trust property has been disposed of, and an accounting for, and the payment back to the trustee of, the profits of the trust property wrongfully retained, and also a reconveyance of the portion of the trust lands, which, it is alleged, have been wrongfully obtained by the defendant Fithian for his personal use.

The bill of complaint is challenged under the 213th rule, in three particulars: The first is as to the 12 or 13 pages in which the trustee narrates the origin and the terms of his trust. The criticism made of this portion of the bill is that it is wholly immaterial as to whether the complainant is trustee or not; if he is, it is wholly immaterial what the terms of his trust are; that the gravamen of his bill is the demand that the complainant should have an accounting from his agent employed to dispose of his property; and it is insisted that the origin and nature of the trust under which the complainant holds the lands in question may be wholly left out without any detriment to the complainant's case. An examination of the bill of complaint indicates that the narration of the origin of the trust under which the complainant holds the trust property is necessary, in order to show who are the cestuis que trustent, who, in proceedings affecting the trust property, should be made parties, unless the securing of their appearance is greatly inconvenient or practically impossible. The Court of Appeals settled this in the case of Tyson v. Applegate, 40 N. J. Eq. 311. To strike out the history of the origin of the trust would leave the complainant declaring that he was a trustee, without disclosing his trust, or showing who were entitled to the benefits of it. The narrative of the creation of the trust is somewhat extended, but the transactions out of which the trust grew were themselves both complicated and voluminous. They cannot be stricken from the record without crippling the complainant's statement of his cause of action. The above objection to the bill must be overruled.

The next criticism of the bill of complaint is that it contains an allegation that there was a consultation between the complainant and his counsel touching the transactions involved, and a direction by complainant to his counsel that they should make such inquiry as to the facts as might be necessary to enable him to take legal steps for relief. This is objected to as irrelevant. The obligation upon a party who thinks he has reason to believe he has been defrauded of property is to make diligent inquiry, and pursue his remedy before the defendants, if they be in fact fraud doers, may so act as to change the nature of the title or involve persons who are innocent as to the fraud. If, upon the face of the bill of complaint, it appears that the complainant has supinely slept after

warning of his danger, he might be liable to a charge of laches from a party who, because of this negligence, might have become a bona fide purchaser of the property. The insertion of a clause tending to explain delay in procedure, or to show diligence, while not of vital importance, is in no way prejudicial or embarrassing to the defendants. It should not be stricken out of the bill.

The third criticism of the bill of complaint is the insertion therein of a copy of a letter written by the counsel of the complainant to the defendant Fithian at or about the ending of a correspondence between them regarding the subject-matter of the present lawsuit. The objection is that this letter is wholly irrelevant and immaterial as a part of the complainant's statement of his cause of action; that it is in the nature of a law brief, and has no proper place in the bill of complaint. The letter in question is a statement by complainant's counsel to the defendant Fithian of his view of the legal basis of complainant's claim, and expresses a willingness to confer for "adjustment without recourse to the courts," etc. It occupies about one page of the bill. In equity costs are not necessarily awarded to the successful party in the final decree. The showing on the face of a bill of complaint that previous to its filing the defendant had been warned of his equitable duty, and requested to perform it, is a pertinent allegation. The complainant, if successful in the cause, may appeal to the fact that the defendant contested the suit with previous warning of the legal basis of the complainant's claim, as a justification for the allowance of costs.

None of the specified criticisms of the bill of complaint can be sustained. The motion to strike out is therefore refused, with costs.

CONGLETON v. SCHREIHOFER et al. (Court of Chancery of New Jersey. Feb. 3, 1903.) STATUTES

BANKRUPTCY

CONVEYANCES-DELIVERY

CONSTRUCTIONPREFERENCES GRANTEE -KNOWLEDGE OF BANKRUPT'S INSOLVENCY.

1. Bankr. Act, § 67, par. "e" [U. S. Comp. St. 1901, p. 3449], provides that conveyances by a bankrupt within four months prior to filing the petition in bankruptcy, with intent and purpose on his part to hinder, delay, or defraud his creditors, shall be void as against such creditors, except as to purchasers in good faith and for a present consideration. Held, that such act referred only to transactions which were previously void under the statute of frauds, and hence a conveyance by a bankrupt to a bona fide creditor for a precedent debt, by way of preference, was not invalid thereunder.

2. Where a preferred creditor of a bankruot had been previously examined in the bankruptcy proceedings in regard to the conveyance, such creditor's evidence was admissible against her in a subsequent action to set aside the conveyance in a state court.

1. See Bankruptcy, vol. 6, Cent. Dig. § 259.

3. Where a bankrupt was examined in the bankruptcy proceedings concerning an alleged preference, his testimony given there was only admissible as against an alleged preferred creditor in an action in the state court to set aside such preference as affecting the bankrupt's credibility as a witness in the state court.

4. Defendant loaned money to her brother, as a temporary loan, which was renewed for several periods, of six months each, until 1896, during which the brother was solvent. Interest was paid on the note until July, 1900, when defendant requested security, and the brother informed her that he would give a deed of certain lots for the note, which defendant agreed to accept. Nothing was said as to the brother's finances, and he executed a deed of the lots to her August 8, 1900, and had same recorded the next day. He filed a petition in bankruptcy August 17th, and was adjudicated a bankrupt on September 17th, after which defendant obtained the deed from the register's office, having previously been informed thereof by her brother. Held, that the facts were insufficient to show that at the time of the conveyance she had knowledge or reasonable cause to believe that her brother was insolvent, or that he intended the deed as a preference.

5. The deed was delivered when the grantor left it for record, and therefore the title to the property did not vest in the bankrupt's trustee, under Bankr. Act, § 70, subd. 5 [U. S. Comp. St. 1901, p. 3451], vesting in such trustee property which prior to the filing of the petition the bankrupt could have transferred, or which could have been levied on by judicial

process.

Bill by Jerome T. Congleton, as trustee, against Jacob Schreihofer and another, to set aside a conveyance as an alleged preference by a bankrupt. Bill dismissed.

W. T. Day and J. E. Howell, for complainant. E. S. Black, for defendants.

EMERY, V. C. Complainant, a trustee in bankruptcy of Jacob Schreihofer duly adjudicated a bankrupt by the United States District Court, files this bill to set aside a conveyance made by the bankrupt to defendant Elizabeth Steigert. The deed was dated and acknowledged August 8, 1900, and recorded August 9, 1900. The petition in bankruptcy was filed August 17, 1900, and the date of adjudication of bankruptcy was September 17, 1900. Under the United States bankrupt act of 1898, § 70 [U. S. Comp. St. 1901, p. 3451], the trustee is, inter alia, "vested by operation of law with the title of the bankrupt, as of the date he was adjudged a bankrupt, to all * (4) property transferred by him in fraud of his creditors; (5) property which prior to the filing of the petition he could by any means have transferred, or which might have been levied upon and sold under judicial process against him.

*

* Section 60, par. "b" [U. S. Comp. St. 1901, p. 3445], also provides "that if a bankrupt shall have given a preference within four months before the filing of the petition, or after the filing of the petition and before the adjudication, and the person receiving it, or to be benefited thereby, or his agent acting thereon, shall have had reasonable cause to believe that it was intended thereby to