but in that case the contract stated the sole consideration to be an agreement of the plaintiffs to sell and transfer the property to the defendant upon payment of the note. This clearly made an executory contract of sale. The learned judge said: "I will admit that the actual delivery of the machinery to the defendants, although they took it as bailees, would be sufficient to constitute a lawful consideration for the giving of the note, if it were left for the court to give effect to that transfer of possession; but the plaintiff has taken from the defendants a written contract which not only specifies what are to be the rights of the parties until payment is made, but goes on and specifies precisely what is the consideration for the defendants' promise to pay this amount of money." From the report of the case of Swallow v. Emery, 111 Mass. 355, it appears that the contract in that case was an executory contract. Chief Justice Chapman says: "It appears that the plaintiff delivered the horse, wagons, and harness to Waby, to be used, and under a contract of sale that the stipulated price should be paid." The contract also provided that after payment of the price the plaintiff was to give Waby a bill of sale. In that case something remained to be done by the vendor. In the present case nothing remains to be done by the vendor. The contract was entirely executed on its part. All that remained to be done was for the vendee to pay the purchase price.

It is strongly urged on behalf of the defendant that the effect of allowing the plaintiff to recover upon the notes when the property is destroyed by fire before the title passes is to subject the defendant to the risk of loss by fire, contrary to the general rule that the risk is with the owner of the property. Upon this subject the language of Lord Blackburn in Martineau v. Kitching, L. R. 7 Q. B. 436, 455, 41 Law Journal, Q. B. 227, is noteworthy: "As a general rule, res perit domino is both the old civil-law maxim and a general rule of our law, and, when you can show that the property passed, the risk of the loss prima facie is in the person in whom the property is. If, on the other hand, you go beyond that, and show that the risk attached to the one person or the other, it is a very strong argument for showing that the property was meant to be in him. But the two are not inseparable. It may very well be that the property shall be in one, and the risk in another." In the present case the defendant expressly agreed to insure the apparatus, and to keep the same insured. This is a strong indication that the intention of the parties was that the risk of fire should be the risk of the vendee, regardless of who was the legal owner of the property.

The judgment is reversed and the record remitted for a new trial. Costs must abide the event.

THROCKMORTON ▼. O'REILLY et al. (Court of Chancery of New Jersey. May 23, 1903.)

MORTGAGES-FORECLOSURE

SURPLUS - EXECUTION PURCHASER - REDEMPTION BY OWNER BILL SUFFICIENCY OF ALLEGATIONS-MORTGAGEES' FRAUD-ACQUIREMENT · OF EQUITY OF REDEMPTION.

1. Ou a bill by a mortgagor to recover the surplus proceeds of a foreclosure sale, it is not necessary to allege that a trust whereby a prior execution purchaser of the equity held it for the mortgagor's benefit was created by writing; that being, under the statute of frauds, merely the method of proving a trust, and not of creating it.

2. The bill alleged a purchase at execution sale by the judgment creditor, and that afterwards the mortgagor endeavored to settle with such creditor, and to pay him the money due him, and have him convey to her, and that the creditor had agreed upon a sum which he would accept and make such conveyance, which sum was, as near as the mortgagor could remember, about $1,200, etc. Held, that it was sufficiently alleged that the creditor had agreed with the mortgagor to permit her to redeem the premises within a reasonable time upon the payment of $1,200 or thereabouts.

3. Where a judgment creditor for less than $800 purchases at his own execution sale an equity of redemption worth $8,500 for $750, the unconscionable character of his bargain, and the consequent right to redeem arising in the owner, furnish a sufficient consideration for the creditor's agreement to permit redemption.

4. It is not necessary to the validity of an agreement by an execution purchaser to permit the debtor to redeem from the sale that a time for such redemption be fixed.

5. A judgment creditor purchasing at his own execution sale will be presumed to know of the existence of prior incumbrances.

6. A bill by a mortgagor to recover the surplus proceeds of foreclosure alleged the prior purchase of the equity of redemption by a judgment creditor at his own execution sale; that the mortgagor had arranged with such creditor to redeem; that the attorneys and agents of the mortgagees called upon the mortgagor, and endeavored to purchase her interest, which was refused, she informing them that she expected to settle the mortgages, and that they had called on the judgment creditor and endeavored to purchase his interest, and he had refused to deal with them, stating that they must get an order from the mortgagor for a deed before he could convey to them; that afterwards they represented to such creditor that they were acting for the mortgagor's benefit, and secured a deed on such representation. Held, that notice to the mortgagees of the mortgagor's equitable title, arising from the agreement with the judgment creditor for redemption, was sufficiently alleged.

Bill by Mary E. Throckmorton against Hugh O'Reilly and others. On demurrer. Demurrer overruled.

Aaron E. Johnson, for complainant. Charles J. Roe, for demurrants.

PITNEY, V. C. The object of the bill, briefly stated, is to recover from the defendants a sum of upwards of $7,000 received by them as part of the surplus money arising from the sale under foreclosure of certain premises belonging to the complainant, or such other relief as the circumstances may justify. The mode in which it is charged the defendants become liable to pay this

money is that the legal title to the equity of redemption of the mortgaged premises was vested in one Van Note, who held it as security for a sum of about $1,200 due from complainant, and that Van Note held such equity in trust for complainant, subject to his lien for the sum just mentioned, and that the defendants herein procured said Van Note, by false pretenses, to make a conveyance of such equity of redemption to the defendant Patrick J. Reilly, who holds it in trust for the other defendants; that thereupon the property was brought to sale under foreclosure, and produced the sum of $16,300, amounting to $8,419.55 over and above the amount due for all prior incumbrances and the costs and expenses of the sale; and that then, by petition presented by said Reilly, and without notice to the complainant, who was a party defendant to foreclosure proceedings, and had appeared therein by solicitor, the defendants procured frome chancellor an order that said Reilly might be excused from paying said surplus money to the sheriff, and that the sheriff should take his receipt for the same.

The facts set out in the bill may be stated more in detail as follows: The title of the complainant to the equity of redemption is set forth with great and unnecessary detail. The property in question comprises three lots adjoining each other, and fronting on Broadway, in the city of Long Branch, and upon it is a valuable building, used as a hotel and boarding house, and known as the "Rockwell Hotel," and, by the allegation of the bill, was worth at one time $20,000. The complainant and her husband mortgaged the same to the defendants herein, or their predecessors in title, and the same became subject to tax titles held by one Green, which incumbrances and tax titles amounted on the 26th of April, 1901, as computed by the master in the foreclosure suit thereon, in the aggregate, to $7,615.18. In addition to that indebtedness, the complainant, subsequent to such mortgage, had become indebted to two or three individuals, including the said Van Note, and three small judgments had been recovered against her in and before August, 1899. These judgments amounted in the aggregate to less than $700, and all became vested in Van Note. He caused the property to be advertised for sale under common-law execution on said judgments on the 30th of July, 1900, and on that day they were sold and stricken off to Van Note by the sheriff for the sum of $734.28. On the 2d of August, 1900, the sheriff made a deed to Van Note for the premises, which was, of course, subject to the mortgage incumbrances and tax titles previously mentioned. At that time the premises were worth at least $7,500 above all incumbrances. After the making and recording of this deed to Van Note on the 4th of October, 1900, the defendants O'Reilly and Skelly filed their bill to foreclose their mortgages;

The

made the defendant and her husband parties defendant, as owners, or otherwise interested in the premises; and also made Van Note a party by reason of his sheriff's deed. complainant lived in New York City, and was proceeded against therein as an absent defendant, and received no notice whatever of the proceedings until after the time for answering had expired, and then employed a firm of solicitors in Jersey City, who entered an appearance for her, but made no defense, and did not set up her equitable title. A decree pro confesso was taken in the foreclosure suit in March, 1901. An order of reference was made to Master Roe to compute the amount due on the mortgages and the tax titles, and to state the priority of the claims. He made a report on the 26th of April, 1901, showing that the amount due for taxes and interest on the mortgage was, as I have stated, $7,615.86. Execution was issued in the usual terms, directing the surplus money over and above that amount be paid into court. The prop

erty was bid for and purchased by the defendant Patrick J. Reilly for the sum of $16,300.

Previous to that, and pending the foreclosure proceedings, the complainant applied to Mr. Van Note for relief against his purchase; and, as special objection is made to this part of the bill, I will transcribe its language: "And your oratrix further shows that after the purchase of said premises by said Clarence G. Van Note, under his judgments, as above set forth, on the 30th day of July, 1900, your oratrix endeavored to settle with said Clarence G. Van Note, and to pay him the money due him under his said judgments and for his said costs, and have him convey to your oratrix all his right, title, and interest in the said premises; and she further shows that said Clarence G. Van Note held said premises and claimed them as his own. And your oratrix further shows that on or about the day of July, 1901, and a few days prior to the 3d day of August, 1901, and prior to the 5th day of August, 1901, the day of said foreclosure under said mortgages, the said Clarence G. Van Note had agreed upon a certain sum which he would accept, and convey to your oratrix said premises upon the payment, which sum was, as near as your oratrix can remember, about twelve hundred dollars; and your oratrix shows that thereafter the said Clarence G. Van Note held said premises only as security for said sum of money so agreed upon by him, and only for the purpose of conveying them to your oratrix upon the payment of said sum of money."

It is alleged that this does not show an equitable title in the complainant, for several reasons. First, because it does not show that any writing showing the trust was signed by Mr. Van Note. But this is clearly unnecessary. The statute does not require that a trust of land should be orig-.

inally created by writing, but only that it shall be proved by such. So that it is well settled that a statement in writing made by a party long after the original transaction, admitting that he holds land in trust for another, is sufficient proof of the existence of the trust. Here, while the allegation under consideration is couched in inartistic language, yet I think it sufficiently asserts that Van Note had agreed with the complainant to permit her to redeem the premises within a reasonable time upon the payment to him of the sum of $1,200 or thereabouts. Whether the complainant will be able to prove that allegation in such manner as to satisfy the statute of frauds at the hearing, it is not necessary at this time to consider.

The next objection is that the agreement with Van Note was made long after the title was vested in him, and there was no consideration for such agreement. But the circumstances of the case must be taken into consideration. Here Van Note, a judgment creditor for less than $800, had purchased an equity of redemption worth $8,500 for the paltry sum of $750. Now, in the absence of gross laches on the part of the complainant, which does not here appear, the inadequacy of consideration is so great as to shock the conscience, and to give the complainant, as against Van Note, a clear standing in a court of equity to be relieved upon equitable terms from that sale.

The complainant was, as stated in the bill, straitened for money, and not in a condition to either pay the judgment before the sale, or to immediately tender Mr. Van Note the amount of his debt and costs; but she did see him, and she did agree with him that she would pay him $1,200, or thereabouts, to be reinstated with her title, and the consciousness on his part that she had that equitable standing to redeem the property upon equitable terms was sufficient consideration, if any was needed, for the contract which Van Note made, to allow her to redeem the premises. Moreover, I am by no means sure that any acknowledgment or promise, either oral or in writing, on the part of Van Note, was necessary in order to establish complainant's equity against him. A strong argument may be advanced in support of the position that such equity arose out of the facts stated in the bill, other than the negotiations between complainant and Van Note for reconveyance.

Another objection made is that no time was fixed between the complainant and Van Note for such redemption. But none was necessary, if it be true that Van Note held the premises in trust for the complainant. The implication would be that she should redeem within a reasonable time or on demand. The allegations of the bill and the result of the final sheriff's sale under foreclosure show that Mr. Van Note was perfectly safe, and in no danger of losing his money, and might well be content, as it is fairly infera

ble he was, to indulge the complainant in the matter of time, and enable her to make her financial arrangements to satisfy his claim. Besides, the presumption is that Mr. Van Note knew that there were prior incumbrances on the property, and that in case of foreclosure and sale he would be perfectly safe to receive his money. His forbearance does not destroy her equity. I think, then, that the allegation of her equitable title is sufficient.

The bill further alleges that for several days prior to the sheriff's sale under foreclosure, which took place on the 5th of August, 1901, Mr. Duffy, the solicitor of the complainants in the foreclosure suit, who are the defendants herein, and one McK., a member of the bar, and one Hugh O'Reilly, Jr., son of one of the defendants herein, called upon her and endeavored to purchase her interest in the premises, and that complainant refused to settle with them or convey her interest to them, and informed them that she was the owner of the premises, and expected to be able to settle the mortgages and the incumbrances against the same; and she says that at that time she was endeavoring to procure the money to pay all the incumbrances. And the bill further alleges that those persons came to her on behalf and as the agents of the defendants herein.

After failing to purchase the complainant's right in the premises, the bill alleges that the same persons, on the 3d of August, two days before the sale, called upon Van Note and endeavored to purchase his interest in the premises; that they had previously called on Van Note for the same purpose, and that he had refused to deal with them, stating to them that they must get an order from the complainant for such deed before he could make any deed to them, which was the occasion of their visit to complainant; and that on the 3d of August, having failed to agree with the complainant, and having been notified by Van Note that he would not deal with them, except by consent of the complainant, they stated to Van Note that they were acting as representatives of the complainants in said suit, but "for the benefit of and in the interest of your oratrix, and requested him to make a deed for his interest in said premises to such person as they should name, and offered to pay him for making said deed the sum of $1,200, or thereabouts, which he had agreed to take from your oratrix in settlement of his claim, and they further represented to him that said deed would be for the benefit of your oratrix, and would protect her and secure her interest in said premises, at and after said foreclosure sale, and would secure her the surplus arising from such sale. And your oratrix further shows that said Clarence G. Van Note, believing that the said Joseph A. Duffy, Patrick McKenna, and Hugh O'Reilly, Jr., came from the complainants in said cause, and were acting for the

interest and benefit of your oratrix, and would protect her interest in said premises, and would pay and secure to her the surplus realized at said sale, after paying all the liens and incumbrances against said premises and costs of suit, and the sum of money he should receive, made and executed a deed for said premises to one Patrick Reilly, whom they named, for which deed they paid him the sum of $1,200, or thereabouts. And your orator shows that the said Clarence G. Van Note executed deed under the promise that the same would operate in the interest and for the benefit of your oratrix."

The bill further states that Patrick J. Reilly, the grantee of said deed, purchased the premises at the foreclosure sale for $16,300; and on the 14th of August he presented a petition to this court, claiming that, under the deed which he had received a few days before from Van Note, he was the owner of the premises, and entitled to the surplus from the sale thereof after paying the decree and costs, and asking that the sheriff who conducted the sale should be permitted to accept his order or receipt for said balance of surplus; that in that proceeding he was assisted by the lawyer, McK., who assisted the other parties above named in procuring the conveyance from Van Note by pretending to act in the interest of, and for the benefit of, the complainant. And a reference was made on that petition to Master Roe, who reported upon the matter, and by his report showed a balance of the proceeds of the sale after payment of the taxes, liens, and all incumbrances, of $8,419.55; and on the 20th of August the chancellor made an order, based on the report of Master Roe, which directed the sheriff to accept the receipt or order of Patrick J. Reilly as payment for the balance of the surplus money under the sale.

The bill alleges that no notice of that proceeding before the master was given to the complainant or her solicitor, although their addresses were well known to the defendants and to McK. and Duffy, the solicitors of the complainant in the foreclosure suit. The bill further alleges that Patrick J. Reilly, who took the title from Van Note, was the mere figurehead for the other defendants herein, who were the complainants in the foreclosure suit, and that Duffy and McK., with Reilly, acted for the defendants; that they (the defendants) were the principals, and secured the benefit of the whole transaction; and that the whole surplus money of $8,419.55, except $1,200 paid to Van Note, really belonged to the complainant. The bill further charges that the report of Master Roe, providing for the disposition of the surplus money, was procured by a fraud on the practice of the court. The prayer is that the defendants may be declared to be liable to pay that sum to the complainant, and that she may have other relief.

The objection made to this part of the bill

is that it does not sufficiently state notice to the defendants of complainant's equitable title. But it seems to me that the mere reading of the bill shows that that objection has no foundation. It alleges that before de; fendants purchased from Van Note they were told, not only by Van Note, but also directly by complainant, that she was the equitable owner of the premises, subject to the amount due Van Note, and their application to purchase her rights was itself an admission that she had some rights, and, if so, then she should have had notice of the proceeding before the master to determine the ownership of the surplus money. In short, the statement of the case shows a fraud practiced by the defendants on the complainant by means of false representations to Van Note, and by a fraud upon the practice of the court, in failing to give the complainant notice of the proceedings before the master to dispose of the surplus money.

I will advise an order overruling the demurrer, with costs, with leave to the defendants to answer within 20 days.

(64 N. J. E. 555) GREY, Atty. Gen., v. MORRIS & CUMMINGS DREDGING CO. (Court of Chancery of New Jersey. May 16, 1903.)

EQUITY-JURISDICTION-LEASE BY STATE OF LANDS UNDER WATER-SUIT TO ANNULOWNERSHIP OF SHORE FRONT-EVIDENCEADVERSE POSSESSION-CHANGE OF HIGHWATER LINE RESERVATION OF WATER RIGHTS.

1. Equity has jurisdiction of an information by the state to annul a lease of its lands under water on the ground that the lessee was not the owner of the shore front, but, with knowledge of the facts, had suppressed them, and that the lease was conditioned to be void if he was not such owner.

2. Where one at the time of receiving a lease from the state of its land under water was the owner of the shore, and so entitled to the lease, the state cannot avoid it because another afterwards acquired title by adverse possession to the shore.

3. Where one selling land reserves a strip along the shore, above which ordinary high water does not come, his right, as against his vendee, to a lease from the state of the land under water, is not lost by the ordinary highwater line rising above such strip.

4. Evidence in an action by the state to annul a lease of lands under water, on the ground that defendant was not the owner of the shore front, held to show that he was such owner.

5. Where the state makes a lease of lands under water, conditioned to be void if the lessee is not the owner of the shore front, it may be avoided, he not being such owner, though by his deed of the shore front he had reserved the water rights, even if he is entitled to obtain a lease of such lands as against his vendee.

Information by Samuel H. Grey, Attorney General, against the Morris & Cummings Heard on information, Dredging Company. answer, replication, and proofs. Information dismissed.

J. E. Howell, for informant. Lindley M. Garrison, for defendant.

EMERY, V. C. The Attorney General, on behalf of the state, files this information for the purpose of annulling a lease of the state's lands under water in New York Bay, made to the defendant by the riparian commission'ers under the riparian acts. The application for the grant or lease made by the defendant, dated April 11, 1881, covered a shore front of about 2,500 feet, the whole of which was alleged to belong to the defendant in fee, and to be in its possession. Upon this application a grant was made by the riparian commissioners on April 30, 1881, for the lands under water in front of the whole lands, of which defendant claimed to be shore owner. The lease was perpetual, for the annual rental of $4,233.60 for the entire lands, with a purchase price of $64,080 as compensation for conveyance free from rent. The lease recites defendant's ownership of the shore in front of which the leased lands lay, and the application for a lease to it as shore owner under the riparian acts. It contained covenants on the part of the state not to give any grant or license to any other person or corporation affecting the lands leased. This proviso, however, followed the covenants, and concluded the terms of the lease: "Provided also nevertheless, that if the said party of the second part is not the owner of the lands adjoining the lands under water hereby conveyed, then and in that case this conveyance and lease, so far as the same binds the state and all covenants herein on the part of the state, shall be void." The information alleges that as to a shore front of about 240 feet of shore, in front of which lands under water were included in this grant, the defendant was not the shore owner, but that one Joseph W. Hancox, under whom relator claims, was the shore owner, and that the grant or lease was made to defendant without notice to Hancox as required by the riparian acts. Hancox conveyed the tract claimed to be on the shore front to the relator on September 1, 1882, and this information, on its relation, was filed on October 11, 1899. The information alleges that Hancox was the owner of this portion of the shore in front of which the lands were leased, that the defendant had no right or title or interest therein, that its representation in the application that it was the owner of all the shore lands was not true, and that the defendant, with full knowledge of the facts as to ownership, suppressed them. The grant is alleged to be void, and a cloud upon the title to the lands under water included therein; and the information prays a decree that the lease may be declared null and void, and the cloud on the state's title to the lands therein described may be removed. The information appears to claim the avoidance of the entire grant, and not merely of the portion in front of the lands claimed to belong to relator. No allegation is made in the information as to the payments of rents under the lease. Neither' is there any tender or offer to return any

portion of the rents received. The answer denics Hancox's ownership of the shore front, as claimed by the relator, and asserts its own title as shore owner, at the time of the lease, to the entire shore in front of which the lands under water were leased. It sets up also the payment by defendant to the state of over $78,000 as rentals for the property, and the expenditure by defendant of large sums of money in filling in the lands under water. The knowledge of Hancox and of the relator, for many years, that the riparian lease in front of the lands claimed by relator had been made to defendant, and that defendant was paying the rentals and the expense of filling in the lands, is further set up as an estoppel or bar against questioning the lease. As to the right of Hancox or relator as shore owners, the defendant further sets up that in the deed to Clement D. Hancox, the predecessor of Joseph Hancox in title, conveying to him on July 1, 1863, the tract of land which relator claims to bound on the shore, it was agreed between the grantee, Clement D. Hancox, and his grantor, George W. Howe, who then owned all the shore front subsequently acquired by the defendant, that the grantor reserved to himself and his legal representatives the water rights in front of said lands in New York Bay, and the right to dock out and reclaim the same, as far as they might desire, to their own use, benefit, and behoof, forever. These water rights, it is alleged, have been expressly reserved in all of the subsequent deeds and mortgages of the lands conveyed to Clement D. Hancox, and were reserved in the conveyance to relator. Defendant claims to have succeeded to all of Howe's rights, and that at the time of Howe's conveyance to Hancox, on July 1, 1863, the line of the shore did not reach the tract conveyed.

Three questions were argued at the hearing, and are to be considered: (1) Whether this court has jurisdiction to annul the grant in a proceeding of this character; (2) whether the relator's predecessors in title were the owners of the shore front, as claimed, either in 1863, at the time of the original severance of the title to the riparian lands, by the deed from Howe to Clement D. Hancox, or at the time of the riparian grant in 1881; and (3) the effect of the reservation of water rights to the grantor Howe upon the lease in question. Upon these points I reach the following conclusions:

1. The question of jurisdiction in equity to annul grants of this character, alleged by the state to have been obtained by a person not shore owner, and by a willful suppression of facts or false representation, is discussed and decided by Chancellor Magie in Attorney General ex rel. City of Elizabeth v. Central R., R. of N. J. (1901) 61 N. J. Eq. 259, 48 Atl. 347. The jurisdiction is maintained, and the only further observation to be made is that in the present case there is the additional circumstance that by the proviso the lease