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itself, a sale for the assessment upon the claimants' sale must show that every prerequisite to the power of lots would not even create a cloud upon his title. For sale has been complied with, and compliance with law as every person must be presumed to know the law, a must appear on the face of the proceedings. 2 Dill. on proceeding which is upon its face not only illegal, but Mun. Corp. 658; Collector v. Day, 11 Wall. 113. absolutely void, does not constitute a cloud upon the A writ of certiorari will afford the owner of proptitle to real estate against which a court of equity will erty, subject to an illegal assessment, another mode of relieve." In Van Doren v. Mayor of New York, 9 redress or relief. This remedy is expressly referred to Paige, 389, the same eminent judge, reaffirming the as an appropriate one by Mr. Justice Field, in deliverprinciple of the previous case, adds: “A valid legal ing the opinion of the court in Ewing v. St. Louis, and objection appearing upon the face of the proceedings, is approved by Judge Dillon in his excellent work on through which the advorse party can alone claim any Municipal Corporations. That learned author reright to the complainants' land, is not in law such a marks: “The unquestionable weight of authority in cloud upon the complainants' title as can authorize a this country is, if an appeal be not given, or some court of equity to set aside or stay such proceedings. specific mode of review provided, that the superior But where the claim of the adverse party to the land common-law courts will, on certiorari, examine the is valid upon the face of the instrument, or the pro- proceedings of municipal corporations, even although ceedings sought to be set aside, as where the defend- there be no statute giving this remedy; and if it be ant has procured and put upon record a deed obtained found that they have exceeded their chartered powers, from the complainant by fraud, or upon a usurious or have not pursued those powers, or have not conconsideration, which require: the establishment of ex- formed to the requirements of the charter or law trinsic facts to show the supposed conveyance to be under wbich they have undertaken to act, such proinoperative and void, a court of equity may interfere ceedings will be reversed or annulled. An aggrieved and set it aside as a cloud upon the real title to the party is, in such case, entitled to a certiorari ex debito land." The chancellor cites Simpson v. Lord Howden, justitiæ.2 Dill. on Mun. Corp. 740. 3 My. & Craig, 97, in which it was decided that there Equity will interpose, in a proper case, to prevent a is no jurisdiction in equity to order a legal instrument multiplicity of suits, excessive litigation, or circuity to be delivered up, on the ground of an illegality which of action. A court of equity, on a bill being filed for appears upon the face of the instrument itself. In a discovery, will sometimes proceed to take jurisdicPixly v. Huggins, 15 Cal. 127, it was held that if the tion of all the matters in controversy between the sale which it was sought to restrain is such, that in an parties, instead of sending them to a court of law, and action of ejectment brought by the purchaser under tbus avoid cirouity of action. And so, to prevent a the sale, the real owner would be obliged to offer evi- multiplicity of suits, as of one against many, or of dence to defeat a recovery, then such a cloud would many against one, in relation to the same cause of be raised as to warrant the interference of equity to action, the aid of equity may be invoked. But multiprevent the sale. High on Injunction, $ 272, recog- plicity does not mean multitude, and equity will not nizes the same rule as settled by the general current of interfere where the object is to obtain a consolidation authorities which draw a distinction between cases of actions, or to save the expense of separate actions. where the invalidity or illegality charged as the cloud Sheldon v. Center School Dist., 25 Conn. 224; Dodd y, is shown by evidence dehors the record, and where it City of Hartford, 24 id. 232; Lord Tenham v. Herbert, appears upon the face of the proceedings. And while 2 Atk. 483; Eldridge v. Hill, 2 Johns. Ch. 283. Or in the former case the relief is freely granted, in the where the claim of right rests on a mere question of latter courts of equity will not interfere. To the same law, as for ascertaining the legality of the proceedings effect is Heywood v. City of Buffalo, already cited, ap- of a municipal corporation. West v. Mayor of Albany, proved by Ewing v. St. Louis, 5 Wall. 413, and by Dows 10 Paige, 539. Chancellor Kent, in Eldridge v. Hill, v. Chicago, 11 id. 108. In Ewing v. St. Louis, the court supra, says: " Enjoining litigation at law seems to Bay, that with the proceedings and determinations of have been allowed in only one of those two cases, inferior boards or tribunals of special jurisdiction either where the plaintiff has already established his courts of equity will not interfere, unless it should right at law, or where the persons who controvert it become necessary to prevent a multiplicity of suits or are so numerous as to render an issue under the direcirreparable injury, or unless the proceeding songht to tion of this court indispensable to embrace all the parbe annulied or corrected is valid upon its face, and the ties concerned, and to save multiplicity of suits." A alleged invalidity consists in matters to be established distinction is also to be observed between bills for the by extrinsic evidence. The most recent case on this prevention of multiplicity of suits or bills of peace, point that has come under our notice is Wells v. City whose object is the suppression of useless and vexaof Buffalo, 21 Alb. L. J. 234, which was an application tious litigation, and cases where the real object of the to set aside an assessment as a cloud upon the title to relief sought is the consolidation of a number of suits the plaintiff's land on the ground that the statute au- of like nature, since in the former class of cases courts thorizing the assessment was unconstitutional, and the of equity may properly enjoin, but in the latter they court held that no cloud could be created by an assesg- will refuse to interfere. Thus, where an injunction ment which was void upon its face, and dismissed the was asked to stay proceedings in ninety-two actions of complaint.

ejectment, until one or more might be tried, the parThe owner of personal or real property, seized or sold ties, pleadings, title and testimony being the same in under execution for the collection of an illegal muni- all the cases, the relief was refused, the real object cipal tax, has an adequate remedy at law, either by sought being a consolidation of the actions which a paying under protest the amount demanded, and court of law might properly grant. High on Inj. 329; bringing an action against the city to recover it back, Peters v. Provost, 1 Paine's C. C. 64. In Penn. Coal Co. or by an action of trespass for the recovery of dam- v. Del. & H. Canal Co., 31 N. Y., it was said that where ages.

In the case of a sale of real property under a right can only be adequately protected or enforced a void assessment, as in the case of a sale by by ruinous and expensive lawsuits, courts of equity a sheriff on a void judgment, the purchaser buys have interposed their jurisdiction, and have giveu the at his peril, and the owner may fold his arms in de- | party redress by injunction, specifio performance or tiance, or if dispossessed, maintain his rights by an other adequate relief, in order thereby to preveut litiaction of ejectment. Under such circumstances the gation and the mischief which results from it. Bills owner can sustaiu no irreparable injury and would of peace, says another authority, have been sustained suffer a loss only by his own passive submission to a by the court to settle the rights of parties in a single wrong. A party claiming title under a corporation tax suit, in cases where the questions to be determined were questions of fact, or mixed questions of law and plaintiffs are clearly entitled to recover unless prefact. But no such bill can be sustained to restrain a cluded therefrom by the terms of the first section of defendant from suing at law, where the rights of the tho act of 4th April, 1868 (P. L., p. 58), which is as parties depend upon a question of law merely, and follows: where the defendant in a suit at law must eventually “That when any person shall sustain personal injury succeed in his defense, without the aid of a court of or loss of life while lawfully engaged or employed on chancery, if the law is in his favor. West et al. v. or about the roads, works, depots and premises of a Mayor of Albany, supra. The real object sought to be railroad company, or in or about any train or car reached by the complainants being a consolidation of therein or thereon, of which such person is not an emtheir actions, or remedies, against the defendant cor- ployee, the right of action and recovery in all such poration, they have not presented such a case on the cases against the company shall be such only as would facts and the law as would warrant a court of equity exist if such person were an employee. Provided, that in taking cognizance of their coutroversy to the ex- this section shall not apply to passengers." clusion of a common-law court, which has all the The plaintiff's husband was “route agent” for the necessary jurisdiction and power to grant them full United States post-offico department, travelling daily and adequate redress. It would bo an evasion of prin- over defendant's road from Allegheny city to Blairsciple to allow a dozen or twenty property owners to ville and return, in charge of the United States mails, tie up the hands of a tax collector, while the individual receiving and delivering mails at intermediate stations, owner was compelled to seek his remedy in a court of and assorting and delivering the mails at the termini law. A combination of taxables could at any time of the trip. arrest the operations of a municipal government by Under the statutes and regulations of the post-office enjoining the collection of taxes and thus subordinate department the defendant company received a gross public to private interests.

sum for transporting the mails and the route ageut; The charge that some of the complainants, being likewise furnishing a car properly fitted for the puronly equitable owners of a portion of the real estate pose. Is the case governed by the act of assembly subject to the lien of the assessment, are absolutely above quoted ? remediless at law, would furnish a strong reason for At common law the action would have abated at the interference if they were not represented by a trustee death of A. J. Price. If plaintiffs are entitled to reduly appointed, who has accepted the trust, is acting cover it is by virtue of the 26th section of the act of in that capacity, and has signed the bill of complaint. 31st April, 1846, chartering the company and the act Holding the legal title to the land, he is in all respects of 15th April, 1851. The right to recover in such cases competent to protect the rights and interests of his being a statutory right, the Legislaturo had power to cestuis que trust in a court of law.

modify and restrict that right as to any or all classes of The application for an injunction being unsupported persons. We are, therefore, unable to see that tho fact by the facts and the settled principles and practice of that Mr. Price was at the time of the injury in the equity, as we understand them, we think the bill was employ of the United States government has any effect properly dismissed by the chancellor. Iu coming to on the question. We know of no sanctity or superior this conclusion we have purposely abstained from ex- right created by such employment, nor do we conceive pressing any opinion on the sufficiency of the main that it would affect the question had the deceased been objections to the assessment. The appropriate tribu- on an inter-Stato route. The right to recover is based nal for their settlement is the Superior Court, by which wholly on the laws of Pennsylvania. This act of 1868 they can be heard and determined without interrupt- has received authoritative construction in Kirby v. ing for a single hour the collection of the public taxes, Penn. R. R. Co., 76 Penn. St. 506, and in Richard v. U. and without impairing the rights or injuring the prop- Pa. R. R. Co., 7 W. N. C. 77. The terms of the act erty of the complainants.

are very broad. It includes all persons lawfully emDecree affirmed. ployed in or about the roads, traius, cars, etc., of the

railroad company. The terms of the section being so MAIL AGENT ON RAILROAD A PASSENGER.

broad the minds of the Legislature seem to havo been

directed to the danger of going beyond the supposed PHILADELPHIA COMMON PLEAS, SEPT. 4, 1880. evil intended to be remedied and the proviso is added :

" This section shall not apply to passengers.PRICE V. PENNSYLVANIA RAILROAD Co.

To our minds it is very clear that Price was lawfully

employed on the train of the defendant, at the time Where a railway company received a gross sum for trans

of his injury, and unless saved by the proviso as to porting the mails and route agent over its lines, held, that such route agent was a passenger and the company

passengers, the plaintiffs cannot recover. were liable where he was killed by reason of its negli

Was Price a passenger? Webster defines a passengence while travelling on its trains.

ger: “One who travels in some conveyance as a stage coach or steamboat." The fact that a man is employed

on his travels does not exclude him from being a passwas killed while travelling as mail-route agent on

enger in the popular acceptation of the term, nor does one of defendant's trains, by a collision caused by de- it in view of the statute, else why the proviso exceptfendant's negligence. The jury found for plaintiff for

ing passengers ? Whilo in our view of the case the $5,000, subject to the opinion of the court upon the deceased was carried for hire, in view of the many question whether deceased was, at the time of his

authorities, some of which will hereafter be referred death, a passenger or employee of defendant. Other

to, we deem it immaterial as to whether or not he was facts appear in the opinion.

carried for hiro or carried free, nor is it material that Barton & Sons, for plaintiff.

he was carried on the contract of another with de

fendant. Hampton & Dalzell, for defendant.

In the case of Collett v. L. & N. W. Railway, 16 Q. EWING, P.J. While lawfully on the train of the B. 984, plaintiff was a mail agent travelling in the defendant company on the way from Blairsville to course of his employment on defendant's train. The Pittsburgh, the husband and father of the plaintiffs mail and agents were carried under the directions of was killed by a collision of trains resulting from the an act of Parliament and regulations similar to those gross negligence of defendant's agents. He was not of our case — except that the agent was to be carried an employee of the company; he was in his proper free. Plaintiff was injured by negligence of defendplace, guilty of no misconduct or negligence. The ant's servants. It was held to be immaterial that he

was carried under a contract with the government. A CTION of replevin for goods seized by defendant, as



United States marshal. pany, to whom they owed the duty to carry safely.

In the case of Nolton v. Western R. R. Co., 15 N. Y. 444, plaintiff was a mail agent carried under the same

Norris & Uhl, for plaintiff iv error. statute and orders as was Price, when he (plaintiff) was Butterfield & Withey, for defendant in error, injured by the gross negligence of defendant's employees. Held, that he was entitled to recover as a

CAMPBELL, J. Mrs. Heyman, the plaintiff, sued de

fendant in replevin for certain goods, which, as we passenger to whom the company owed a duty. In Yeomans v. Contra Costa Steam Nav. Co., 44 Cal.

understand the finding, the court below held were

unlawfully taken from her by defendant, but never71, the plaintiff was agent or messenger for Wells, Fargo & Co., and was carried under a contract of the

theless gave judgment in his favor. Defendant at the express company with the defendant, whereby the de

time the goods were replevied held them as United fendant agreed to the freight and messenger for a fixed

States deputy marsbal, under an execution issued from

the Circuit Court of the United States for the Western monthly compensation. The plaintiff, while on the car of the defendant company, was injured by reason

District of Michigan, against one Adolph Heyman, of the negligence of defendant's servants. Held, that

who was plaintiff's husband. There are no legal conthe plaintiff was a passenger and entitled to recover.

clusions set out in the finding, and there are some facts In Bluir v. Erie R. R. Co., 66 N. Y. 313, the plaintiff

set out which would seem to indicate that there wero was an express agent on the train in the course of his

questions discussed concerning the validity of plaintiff's

title. We have had some doubt whether the court business, in pursuance of a contract, whereby tbe rail

below did not err iu failing to find more specifically as road company contracted to transport the freight of the express company for a certain consideration, and

requested. But the facts actually found show title in to transport the money safes and messengers free of

plaintiff and show nothing to coutrovert it. We shall charge. Plaintiff was allowed to recover.

In argu

assume, therefore, what has been assumed by counsel ment of the case the court treated the ageut as a pass

for both parties, that the ground of the decision was

that defendant's possession, though wrongful, must enger, carried without hire. In Hammond v. N. E. R. R. Co., 6 Richardson (D.

prevail over State process issued in favor of the real C.), 130, the plaintiff was a route agent in performance

owner. And we shall consider the record as involving of his duty when injured by the negligence of the de

the question whether a United States marshal, by seizfendant's employees. The conditions were precisely

ing the property of a stranger to the execution in his similar to those of our case. The court held plaintifr hands, can cut off the right of the owner to recover entitled to recover, clearly putting it as a case of a

his property thus wrongfully seized. For the right is passenger, although not in terms calling him such.

effectually cut off if it cannot be replevied in the State In Penn. R. R. Co. v. Henderson, 1 P. F. Smith, 315,

court, when there is no remedy provided by law for plaiutiff's husband was a drover in charge of his cattle

trying the title anywhere else. on defendant's train, he riding on a drover's pass,

The case supposed to stand in the way of this remedy directing the conductor of the passenger car attached

is Freeman v. Howe, 24 How. 450. The language of to stock train, to pass the bearer in charge of his stock

that case does, when taken by itself, tend to sustain in certain cars. In an exhaustive opinion the court

the claim of defendant, and if it were applicable here, held the plaintiff entitled to recover for the death

and not affected by subsequent decisions, we should occurring by the negligence of defendant's agents. be disposed (as stated in Carew v. Mathews, 41 Mich. Throughout the whole opinion the decedent is treated 576) to regard it as perhaps disposing of the case. But as a passenger; numerous other cases are to the same

when this decision is considered in the light of other effect. In most of these cases the person injured was

decisions which are recognized as binding in the employed on the train, the travel being but an inci

United States courts, we think it has no force when dent of the employment.

applied to the issue before us. The only ground of the In the case before us, while Price was employed, he

decision was that the property there in controversy was was not in any way responsible for the running of

in the custody of the United States court for legal purtrains. The conductor had no more power over him

poses, and that an effectual remedy existed in that and no less than over any other passenger on the train.

court to try and determine the rights of the adverse He had his proper place on the train, but that and his

claimant. If this was so there was little room for disregular travel was all that distinguished him from the

cussion. The remedy there suggested was a bill in other passengers.

equity, wbich it was said would not be treated as a The case of the Perin. R. R. Co. v. Henderson, and separate suit but only as a collateral proceeding in the several of the other cases cited, had been decided same suit. And reference was there made to some fore the passage of the act of 1868. It is a fair pre

other cases in which the question decided was, not sumption that the Legislature had this class of cases in

whether one jurisdiction could interfere with auother, view when the proviso excepting passengers was in

but whether the remedy in equity was a proper remedy serted. Being of the opinion that the deceased, at the to protect the particular rights in controversy. In time of his injury, was a passenger on defendant's train Freeman v. Howe, there can be little doubt that there within the meaning of the proviso of the act of 1868,

was a remedy in equity so far as the subject-matter the plaintiff is entitled to recover.

was concerned, for the complaining parties were railroad mortgagees in trust and the property replevied

by them was taken in that capacity against a levy not REPLEVIN IN STATE COURT OF GOODS by execution, but under mesne process. SEIZED UNDER FEDERAL PROCESS.

There was certainly some force in the suggestion that

the remedy was there adequate, and the fact that the MICHIGAN SUPREME COURT, OCTOBER 13, 1880. property was in the custody of the court was assumed.

Possibly that is true in some cases in regard to propHEYMAN V. COVELL.

erty held under mesne process. But such has not been

the view concerning property held under fiual process, Defendant, as United States marshal, under an execution from a Federal court against plaintiff's husband, seized

and it has been uniformly held that a marshal is a goods belonging to plaintiff. Held, that plaintiff could trespasser and in no way protected by his process when maintain replevin against defendant for such goods in he seizes the property of a stranger, a Stato court.

In Buck v. Colbath, 3 Wall. 334, the action was trespass, and therefore all that was said about other reme- ground for refusing redress to plaintiff, and that she dies was obiter. But it was distinctly intimated that was entitled to judgment on the finding. the difficulty did not arise except concerning property Judgment must be reversed with costs and judgment actually or coustructively in the possession of the entered for plaintiff with nominal damages of six court, and while litigation was still pending. Property cents. under mesne process is in some cases the only basis of Cooley, J., dissented. jurisdiction, and it is often subject to disposition for various purposes pendente lite, so that it may not only be discharged from seizure but may sometimes be dealt

NEW YORK COURT OF APPEALS ABSTRACT. with otherwise. This creates at least a colorable, if pot a real distinction, and may give some force to the ARBITRATION-REFUSAL 07 ARBITRATORS TO HEAR claim that it is in the custody of the court, although TESTIMONY – MISCONDUCT VITIATING AWARD - JUDGwe are not prepared to say the distinction is usually in

MENT OF ARBITRATORS AS TO THEIR POWERS REVIEWfact very important. The case of Buck v. Colbath is ABLE — CONSTRUCTION OF SUBMISSION. — (1) In an arsignificant in confining the doctrine of conflict to in

bitration between plaintiff and defendant, plaintiff terference with the action of courts, and in holding offered to produce certain witnesses named, in order that a marshal who levies on the property of a stranger

to reconcile contradictory statements made by plaintis in no sense acting under process unless the writ

iff aud defendant, but was met by a refusal on the directs the seizure of the specific property taken. The part of the arbitrators to receivo any testimony except distinction between writs against specific property and

the statements of tho parties, they construing the those against undescribed property of named persous

submission to limit their power to the act of passing is made the turuing point. And it was said emphati- upon the statements of the parties. Plaintiff did cally that the plaintiff in error is mistaken when he

not offer to show what the witnesses offered would tesasserts that the suit in the Federal court drew to it the tify to. Held, that if the arbitrators were erroneous question of title to the property, and that the suit in in the construction of the submission, their refusal to the State court against the marshal could not with

receive the testimony offered was such misconduct as draw that issue from the former court. No such issue would vitiate their award and that plaintiff had not was before it, or was likely to come before it, in the forfeited his rights by a failure to show what the prousual course of proceeding in such a suit.

posed witnesses would testify to. The refusal of an In the subsequent case of McKee v.

Rains, 10 Wall. arbitrator to examino witnesses is sufficient miscon22, it was held that a trespass suit by a third person

duct on his part to induco the court to set aside his against a marshal could not be removed into a court of award, though he may think he has sufficient evidence the United States, because his levy could not be re- without them. Phipps v. Ingram, 3 Dowling, 669. In garded as made under any authority of the United Vau Cortlandt v. Underhill, 17 Johns. 405, it was held States. This is certainly equivalent to holding that

that if the arbitrators refused to hear evidence perti. he is no better off than if he had no process, and it is

nent and material, it will vitiate the award. In Fredi. difficult to conceivo how it leaves any room for hold

car v. Guardian Ins. Co., 62 N. Y. 392, it is said that ing that a disturbance of his wrongful possession is if an arbitrator refuses to hear competent evidence on an interference with the court.

the merits, his award will be set aside. (2) The decisIt would not be, we suppose, competent for Congress

ion of arbitrators as to their powers was not concluor any State, even by positive enactment, to deprivo

sive. No such question was submitted to them. It is the owners of property of the right to vindicato their for the court to judge whether arbitrators have extitle by legal process in a judicial trial. There is

ceeded their powers or refused to exercise them. The no legislation which provides any method whereby general rule that their decisions are not reviewable on Mrs. Heyman could secure her rights in the United

the mere ground that they are erroneous, is applicable States court against Covell. Unless she has such a

only to their decisions on matters submitted to them. remedy in duo form of law her only resort must be to

The submission is the foundation of their jurisdiction, the State courts, and this is recognized in McKee v.

and they are not the exclusive judges of their own Rains as well as in Slocum v. Mayburry, 2 Wheat. 2. powers. (3) A submission contained this: “The arbiIt was indeed held in Freeman v. Howe, that equity

tration shall be conducted and decided upon the prinwould relievo in that particular instance, and was said

ciple of fair and honorable dealing between man and that it would in any case of wrongful levy on a third

man.” Held, not to justify tho arbitrators in refusing person's goods. If this were so, the case would not be

to hear testimony other than the statements of tho difficult of redress. But it has since been held that parties. Judgment reversed. Ilalstead, appellant, v. there is no such remedy. In Van Norden v. Norman,

Seaman. Opinion by Rapallo, J. 99 U. S. 378, a bill in equity was filed in the Circuit

[Decided Sept. 21, 1880.] Court of the United States for tho district of Louisiana INSURANCE — LIFE POLICY — INSOLVENT COMPANY to secure protection and restoration against a marshal's NON-PAYMENT OF PREMIUMS. – In this case appellants levy under an execution from the same court, and the represented claims against an insolvent insurance comCircuit Court made such a decree. But on appeal to pany in the hands of a receiver, upon policies which the United States Supreme Court it was held that re- were running at the date of the appointment of the plevin was the proper remedy to regain possession, or receiver, and upon which premiums had been paid to some similar proceeding in the nature of a common- some time subsequent to such date. The persons inlaw replevin, and that equity had no jurisdiction. The sured by such policies died subsequent not only to the decree was reversed for want of jurisdiction, without appointment of tho receiver, but subsequent also to prejudice to an action at law or other redress.

the time to which premiums had been paid. It apIf there is no remedy by bill in equity then it follows peared that the receiver had given express notice that that a common-law action is the proper redress, and he would receive no more premiums. Held, that these such action can only be brought in a court of the claims were within the principle laid down ip People United States where the parties are such as to confer v. Security Life Ins. Co., 78 N. Y. 129. The policies jurisdiction; and in such cases the statutes have made were in full force at the time when the insured persons the jurisdiction concurrent with power removal died. The further payments of premiums were exunder certain circumstances. In the present case it cused by the failure of the company, as well as by the does not appear that suit could have been brought any- express notice of the receiver that he would receive no whero but in tho State court, and the case has gone to more premiums. For the purpose of enforcement, the judgment in the usual course. We think there was no policies were just as effectual as if the premiums had been actually paid. They were not, properly speaking, a portion of its assets in pursuance of law for the purdeath claims, but claims for damages upon policies pose of securing a certain class of its creditors. (3) In running at tho appointment of the receiver; and the computing the value of annuity bonds issued by the rules laid down in the case cited furnish an accurate insurance company, the Northampton table with interand just basis for tbe computation of such damages. est at six per cent (People v. Security Life Ins. Co., 78 Order affirmed. Matter of Attorney-General v. Guard- N. Y. 114) should not necessarily be followed. The ian Mutual Life Insurance Co. Opinion by Earl, J. true rule to measure the value of such annuities is to [Decided October 15, 1880.]

take such a sum as will, for the remainder of the life

of the annuitant, purchase an annuity for the same INSURANCE - LIFE POLICY - INSOLVENT COMPANY amount. In the case of running policies in insolvent RIGHT OF RECEIVER TO APPEAR IN PROCEEDING TO companies, the court has held that the amount of damDETERMINE PRIORITIES - CONSTITUTIONAL LAW - OB- age to a policy-holder is the value of the policy deLIGATION OF CONTRACT -REGISTERED POLICIES -- AN- stroyed, and that such value is the sum, which, together NUITIES - COMPUTATION OF VALUE - FORFEITURES - with the same future premiums, will procure another UNCONSCIONABLE AGREEMENT — USURY.--(1) In a pro- policy in a solveut company. So the value of an anceeding solely to determine the rights of several claim- nuity bond binding the company to make certain anants to the funds of an insolvent insurance company nual payments during life is such a sum as will in the hands of a receiver, held that the receiver had a purchase a similar bond in another solvent company right to appear and file exceptions to the report of the for the remainder of life. Nothing short of that will referee. The receiver represents not only the company, give the party whose bond is destroyed full indemnity. but he stands as a trustee of its funds for all its credit- It would do exact justice between an annuitant and ors. He is supposed to be impartial between the the company to compute the value of his annuity by the several claimants upon the funds; and yet he may in- same table which was used when he purchased the annutervene to see that no injustice is done to any one and ity. It would not be just to take a basis of six per cent that the funds are properly protected, disposed of and interest, when a basis of four or four and a half per cent, administered. Bookes v. Hathorn, 78 N. Y. 222. In

requiring a larger gross sum, was used in the purchase. such cases the claimants do not all usually appear (4) A provision in paid-up policies issued in lieu of before the referee by counsel. They may choose to other policies — upon which notes had been given for rely upon the protection the receiver as their trustee portions of the annual premiums, that in case the inwill give them, and that he may afford them such pro- terest should not be paid as agreed upon any noto tection he may appear before the referee, file exceptions thus given, the policy should become void and the to his report and appeal from any order or decree made

company not be liable for any part of the sum assured, at any stage of the proceedings affecting the funds in

held not to be oppressive, unconscionable or usurious. his charge. (2) A life insurauce company commenced Such contracts are no more unconscionable or oppressbusiness in 1862 and continued business until 1877. For ive than subscriptions to stock upon condition that several years previous to the last date it issued what the stock shall be forfeited for non-payment of calls. were named registered policies under Laws 1866, chap. In such case a large amount of stock may be forfeited 576, 1867, chap. 508, and 1869, chap. 902, which policies

for non-payment of the last call, and that a small one, were, under said statutes, entitled to priority of pay- and yet a court of equity would not relieve against the ment over other policies out of a fund created by pre- forfeiture Sparks v. Liverpool Water Works, 13 Ves. miums upon such registered policies. Held, that the 429; Prendergast v. Turnton, 1 Y. & C. (N. R.) 98, 110 statutes named were not unconstitutional as impairing to 112. See, also, Andrews v. St. Louis Hope Ins. Co., the contract between the ordivary policy-holders and 5 Bigelow, 527; Martin v. Ætna Life Ins. Co,, id. 514; the company. It is clear that the obligations of the Patchen v. Phonix Mut. Life Ins. Co., 44 Vt. 481; company were in po way interfered with or impaired. Knickerbocker Life Ins. Co. v. Vashti, 8 Ins. L. J. 349; The company remained liable to discharge all its obli- Nettleton v. St. Louis Hope Ins. Co., 6 id. 426; Smith gations just as it made them, and precisely according v. St. Louis Mut. Life Ins. Co., 2 Tenn. Ch. 742. There to their terms. The holders of non-registered policies was no usury because in addition to the seven per had no lien upon the property of this company at the cent upon the notes, the forfeiture was also exacted in time of the passage of these acts, and they were there- case of non-payment of the interest. The policy was fore deprived of no lien. Laws abolishing imprison- not affected by any usury, because it was not a conment for debt and distress for rent, and increasing the tract for the loan or for borrowing of any money. amount of property exempt from execution, have been Even the note would not be usurious if it contained a held not to impair the obligation of contracts previously I stipulation that the policy should be forfeited by deexisting. Laws could be passed giving servants a prefer- fault in payment of the interest, because the maker of ence of payment in all cases out of the estates of their

the note could avoid the forfeiture by payment of the employers without impairing the obligation of other interest. Burtow's case, 5 Co. 69. In 2 Pars. on Cont. contracts entered into with such employees. So the 393, it is said: “An agreement to pay more than intefLegislature could, for reasons of public policy and jus. est, by way of penalty for not paying the debt, is not tice, give classes of creditors preference over other usurious, because the debtor may relieve himself by classes, so long as creditors not preferred wero left paying the debt with lawful interest." (5) One P. paid with substantial remedies. Here the holders of regis- 100,000 francs for an annuity of 18,388 francs, payable tered policies were given a preference of payment upon each 22d of December, during life. Anpuities were a fund substantially created with money contributed paid in 1874, 1875 and 1876. The receiver was appointed by them. The special fund created for their benefit in March, 1877, and P. died in November, 1878. Held, could never, in the ordinary management of a company, that the annuity was not to be valued in favor of P.'s be greater than the money contributed by such policy. representative, at what the expectancy was worth holders, and it seems absurd to say that a provision when the receiver was appointei, but at what the bond that they should havo payment out of such fund in was shown to be actually worth by the death of P. preference to other policy-holders violated the obliga- The failure of the company did not increase the amount tion of any contract within the meaning of the Con- of the damages or the value of the bond. Order modistitution. A debtor does not violate the obligation of fied and affirmed. Matter of Attorney-General v. North his coutracts with other creditors by pledging to a America Life Insurance Co. Opinion by Earl, J. class of his creditors a portion or all of his property [Decided Sept. 28, 1880. ] for the purpose of securing their claims, and the same MASTER AND SERVANT-ON WHAT LIABILITY OF MASmust be true of an insurance company which sets apart TER FOR INJURY TO SERVANT DEPENDS_SUPERIN

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