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Vice-Chancellor's Court.-Gilbert v. Mickle.
posted and continued so as "to caution strangers and others" against the complainant as a mock auctioneer.
By the existing statute regulating the police of the city, (Laws of 1846, chap. 302, § 8,) it is made the duty of the sergeants and policemen, "to caution strangers and others against pickpockets, watch stuffers, droppers, mock auctioneers, burners and all other vicious persons.' The same enactment in substance was contained in the police act of 1844. **
In the exercise of his judgment as to his duty and authority under this provision, the mayor has pursued the course which I have pointed out. No one is more ready than I am, to bear witness to the great fidelity and ability with which this gentleman has discharged the arduous and important duties of his high office.
And if this exercise of authority had been limited to him or to the chief of police, I should always be inclined to yield my judgment of the facts in any given case, to their better knowledge and experience.
But it is to be observed, that this very responsible power of the cautioning strangers and others, is delegated to the whole body of the police. And if the construction, thus practically given to the statute be correct, any one of our nine hundred policemen may in the exercise of his discretion, placard any man's store or dwelling, as being one of the many classes of vicious and infamous places, which are so graphically enumerated in the statute.
I confess I was not aware that the legislature had deemed it expedient to delegate such an enormous power to the unbridled discretion of so many officials; amongst whom, however honorable they are as a class, it is not to be doubted that there will always be some men unworthy of their stations, and others who might be easily swayed by malice or the hope of reward.
and state, he is authorized to pursue his business without molestation. That the common law subjects him to fine and imprisonment for the frauds which are alleged against him; and in addition, the statutes impose for the same offences, heavy penalties, amongst which are the perpetual forfeiture of the right to sell at auction, and imprisonment in the state's prison.
That these penal consequences suffi ciently protect the public, without a resort to this high handed and summary proceeding, which condemns a man and executes judgment upon him without a trial, and without an opportunity for defence; and while it sometimes reaches the guilty and prevents fraud and robbery, may also visit destruction upon the innocent and honest tradesman.
And it is strenuously insisted that the statute which authorizes, or by any legitimate construction can be deemed to authorize, such a proceeding, violates the section of the constitution of the state which provides, that no one shall be deprived of life, liberty or property, without due process of law.
I will not deny that these arguments have made a strong impression upon my mind. While I entertain in common with my fellow citizens a rooted dislike, possibly a prejudice, against mock auctions, and all suspected of participating in them, I cannot resist the conviction that the authority in question is liable to great abuses, and as strongly tends to promote violence, as it does to repress fraud.
Nevertheless it is not in my province to judge of its expediency, nor is it my duty to pronounce a statute unconstitutional, except in a case where my conclusions are clear and irresistible; and they are not free from doubt in reference to this law.
And having in view the importance of an efficient police for the prevention as well as the punishment of crime, the discretion necessarily confided to its head In the case before me, without regard and chief officers, the delicate and responto the justice of the mayor's belief re-sible character of their duties, and the respecting the character of the complain-spect which is due to the exercise of those ant's business, it is argued with much ap- duties, by other tribunals and authorities; parent reason and good sense, that he is to say nothing of the reluctance with an auctioneer who has given security to the state in a large amount for the faithful discharge of his functions, and as thus licensed, as well as a freeman of this city
which equity always interferes for the protection of rights of property when those rights are mingled with the administration of criminal jurisprudence; it is my con
Vice-Chancellor's Court.-American Life Ins. and Trust Co. v. Bayard and others.
clusion that this court ought not to inter- | pose its extraordinary power of injunction in the case under consideration.
The exercise of such a jurisdiction would infallibly lead to collisions between the executive and judicial departments, which would bring both into disrepute, and do more injury to the cause of law and good order, than could be compensated by the redress of a few individual grievances like the one set forth in the bill of complaint.
I am satisfied that it is my duty to leave the party to his remedy by an action at law; and if that shall prove to be entirely inadequate, the legislature will undoubtedly repeal or modify the statute itself. The order to show cause must be discharged, and the temporary injunction is dissolved.
Parties are estopped from denying that an instrument had a legal existence so as to make a sale of it for less than its face usurious, where they obtained the loan on the faith of a representation or to that effect.
The bill in this case was filed to foreclose a mortgage on lands in the city of Utica, given by the defendants, Samuel J. Bayard and William M. Bayard and their wives, in February, 1838, to secure the payment of $5000 in five years, with legal interest, payable semi-annually, made to Samuel Bayard, their father, and by him assigned to the complainants, a corporation chartered by the state of Maryland. By their charter the complainants were authorized to purchase real and personal estate, and required to invest one half their capital, among other modes, in mortgages upon real estate, and it was provided if the company failed to pay a certain tax to the state of Maryland, in six months after it became payable, that
Before the Honorable ANTHONY L. ROBERT-
THE AMERICAN LIFE INSURANCE AND
Statutes which forfeit charters for non-performance
of a condition, are to be construed as rendering
them voidable on complaint of the state not void per se, so held in a case of a company whose charter was declared "to be forfeited and deem
ed null and void" on non-payment of a state
Certificates of deposits, payable at remote periods at a distant place, with interest semi-annually, are not adapted to circulate as money, the variation of value by the increase of interest and difference of exchange, making them an article of
commerce and not a standard of value or means of purchase of other articles. The keeping of an office generally and doing an act therein of a particular kind, is no proof that the office was kept for similar purposes. Usury is not proved by the payment of a counsel fee to an officer of the company for examining the title to lands proposed to be mortgaged, and even if colorable it must have been part of the original agreement; it goes only to diminish the re
An exchange of credits is not usurious in law if no
more than 7 per cent. commission is paid on the transaction, even though it be called a loan by the parties, if more than that is allowed it is a question of fact, of usury or not.
An allowance for exchange on a security payable
elsewhere is not usurious in law, but it is a question of fact whether it is so large as to amount to a cover for usury.
"null and void." They were also authorized to "make all kinds of contracts "in which the interest of money was in"volved," and " to fix the places and modes of transfer, &c. of deposits and payment of interest," but were declared not to be authorized "to issue for circulation as money,' any of its own certificates of " deposite payable to bearer;" upon these provisions as well as others contained in the opinion of the court was founded the defence of the defendants. mortgage was delivered to the company for certain promises in writing, dated at Baltimore, in the State of Maryland, in the form of certificates of deposit, called in the financial market, sterling bonds, by which the company agreed to repay the amount purporting to be deposited with them in twenty years, with interest at 5 per cent. semi-annually in London; they were drawn payable to N. Thurston, an officer of the company, or order, he endorsing the same for £200 sterling each. A certain sum between eight and nine per cent. was paid for difference of exchange between New-York and London, and the sum of twenty-five dollars retained for the vice-president of the company, who was a member of the legal profession. Similar bonds of this company were, at the time of the nego
Vice-Chancellor's Court.-American Life Ins. Co. v. Bayard and others.
tiation of the instrument selling in the out office found, (Pl. Com. 486,) even the market somewhat below par. The ne-authority of Co. Litt. 215 a, cited in 9 gotiation with the company for the mort- Wend. 351, is not borne out by the authogage was conducted by agents, whose tes-rity (Plow. Com. of Browning v. timony is referred to in the opinion of the 132,) to which he refers; there a party Beston, court, and it appears that they had charge had sued for trespass, and the justification of a previous mortgage, executed by the lay in ousting, under a lease from the same same parties to another person, made for lessors, the plaintiff, who was lessee under a the purpose of raising money on, of which lease which was to be " such refused to execute an assign-void and of no effect" on non-payment of utterly extinct, person ment to the complainants, and thereupon rent, and though counsel urged the absothe Bayards executed the new mortgage in lute determination of the lease, yet the controversy to their father. The vari- court gave judgment for the plaintiff, on a ous facts material to the issues in the demurrer to the pleading setting up such cause, the state of the pleadings with the justification, on technical grounds, avoiding testimony of the witnesses sufficiently ap- that question whether the lease was void pear in the views of the court. or voidable. It seems too disproportionate a penalty, that all the debtors of this corporation should be entitled to set up its failure to pay a small tax to the state as a defence. I cannot but conclude that
Benjamin F. Butler, for the complain
W. A. Sackett and E. H. Owen, for the the state of Maryland can alone, take addefendants, J. Bayard and others.
B. Robinson, for defendant Bard.
vantage of the omission, (Angell & Ames on Corp. 664.) Besides, as this corporation has once existed, it is the duty of the defendants to allege and prove the facts that destroy it.
THE ASSISTANT VICE-CHANCELLOR.The defence set up to the mortgage sought Secondly. It is said that the company to be foreclosed in this suit, is four fold. had no right to issue certificates of deposit, Firstly, that the complainants have no le- such as were given for this bond and mortgal existence. Secondly, that the consid-gage, but I apprehend, this does not vioeration given for it was contrary to the late their charter. They are authorized provisions of the charter of the company. by the fifth power therein contained to Thirdly, that the contract of which it was make all kinds of contracts, "wherein the the consummation, was contrary to the re-interest of money is involved," and "to fix the straining acts of this state. Fourthly, that it is usurious.
modes and plans of transfer of certificates of stock deposit and payment of interest," but These objections I shall dispose of seri- they were prohibited from issuing for ciratim, and first it is contended, that the com- culation as money, any promissory notes plainants have not paid the Maryland state and the like; "but these instruments cantax, non-payment of which forfeits and not be considered as being “ issued for ciravoids their charter. It is very true that culation as money;" for that purpose, the words are tolerably stringent, "shall be they must be capable of being passed forfeited and be deemed null and void," but from hand to hand, and used in purchasthose words are subject to rules of con- ing any thing the holder wishes, at their struction to prevent the injustice of any nominal value; here these bore a subothers than those intended to be benefitted, stantial rate of interest, increasing their taking advantage of the omission. Here daily value, making it a matter of delibethe state alone was injured by the omis-ration what they might be worth as an arsion to pay the tax, the state alone could ticle of commerce; they were payable forgive or exact the penalty. This is not twenty years after their date, and payable a condition precedent but subsequent, and in London; all of which facts would tend to may be waived. And it is found in a very make them an article of merchandise and not early work on the law, that the words a mere representative of value. Besides "shall forfeit," vests only a right or title, as these defendants do not allege they and not a freehold in deed or in law, with- have them in their possession, and are
Vice-Chancellor's Court.-American Life Ins. Co. v. Bayard.
ready to give them up; I must assume they are in the hands of bona fide purchasers, to whom the company are liable for their amount. (See Chancellor Walworth's recent MSS. Opinion, in Stoney v. American Life Ins. & Trust Co.,) and therefore, these complainants have received a full consideration, and are not entitled to take this objection.
made usurious per se in law, they both being for the same amount; the first is a reservation by the vice-president of the company, who was also its counsel, of the sum of twenty-five dollars for a counsel fee for examining the title; this, it is to be observed, was not a part of the original agréement, and therefore under the decision in this state, of Chancellor WalThirdly, It is said that this is a viola- worth, in Raynors v. The Same Co. in tion of our restraining acts. (1 R. S. 600, MSS., lately made; it would only go to § 4. 711, 712, § 1 to 6.) In regard to its diminish the recovery pro tanto, and inbeing issued for circulation as money, I deed the very allegation of its forming think I have disposed of that point under part of the original agreement, and the the previous remarks on the second head usury would seem to be a variance from of defence: but it is said they kept an the agreement proved. Servoss testifies office of discount and deposit here, where to the performance of some services by this contract was consummated, and so Mr. Duer, and I cannot consider twentythe contract is void. I think the proof five dollars as so exorbitantly inadequate wholly fails to sustain it. Mr. Oakley as to cause a suspicion of lurking usury. proves they kept an office here for their Next it is said that this was a loan of credit, business, and as they had other business and the credit loaned was not worth par, under their charter, and were expressly and the promise to repay it in the form of prohibited from issuing bills, I cannot as- a bond and mortgage, was for a large insume that their business was solely illegal, terest, two per cent. a year more than the and certainly not from one act if this were interest the credit was to bear; if it were so. This act is penal and must be strictly so the case of Fanning v. Dunham, 5 J. construed; I am not to presume a viola- C. R. is directly in point and must be contion of law, and conclude, when the de-sidered the law in this case and in this fendants give me no more proof, which court; and it would seem from this case they could if it existed, that the complain- as well as that of Dunham v. Dey, 13 J. ants were only engaged in illegal acts; for the office complained of in the statute, may as well be kept by an agent in the street if it is known where he is to be found, and does not refer to a mere room in which the statute is violated; this is the view taken by the Chancellor in the case of Stoney v.The Same Company, above referred to, to which I must adhere.
R. 40, and in the court of errors, in 16 J. R. 367, that the commission for the exchange, where the securities are for the same amount, must not exceed the sum of seven per cent. on the security, otherwise the question was to be put to the jury, as stated by Best, C. J., in the case of Stovell v. Eade, 4 Bing. 81, whether the object of both parties was a I come now to consider the last and loan or exchange of securities. I do not most important question, that of usury, consider I am entitled to look at the rate a defence in regard to which, as a judge, at which the complainant's credit was sellI have no other duty to perform, either in ing in market, they were bound to pay favoring it or finding means to defeat it, par for their bonds when they became except that the law has said it presumes due, and if the defendants, the Bayards, a contract made for more than seven per applied for a loan of credit which was becent. interest is extortionate and directs low par, it was their own fault. I preit to be cancelled, and directs the exac- sume if they had given cash, equal to the ter of the extra compensation to be pun-face of the bonds if they were above par, ished. This usury is said to consist in they would not have insisted that they various acts, not appearing in the face of loaned the money mentioned in the mortthe transaction forming a cover for usury,gage usuriously. I can see no such usufor I do not understand or perceive that rious commission beyond the legal rate the exchange of the mortgage for the here, as entitles me to look beyond the face sterling bonds of the company can be of the transaction to see if it be a mere
Court of Common Pleas -Renwick v. S. & W. McAllister.
Court of Common Pleas.
Before the Honorable M. ULSHOEFFER, First
loan, unless it be contained in the charge liability for the amount of the bond and for placing the funds in London instead mortgage. The defendants are estopped New-York by way of difference of ex- from setting up the usury if there were change. This Mr. Oakley testifies was any. fixed at 8 per cent. in this case being not There must be therefore a decree for beyond the ordinary rate arising from the sale, upon the coming in and confirmation different standard of the value of gold of the master's report, of the amount coin in the two countries; and I cannot due to the complainants upon bond bring myself to believe that that covered and mortgage in question, it being ferany usurious charge. It will be observ-red to such master to make such computaed I have expressly omitted any views of tion with the usual directions as to place this case, making it a loan for money, as of sale and residence of master. the witness, Mr. Oakley, expressly testifies it was an application for the bonds. I do not consider the cases of Leavitt v. Delaunay, or New-York Dry Dock Co. v. The American Life Ins. and Trust Co., decided by my predecessor as at all militating against my views in this case, he decided those as questions of fact under the peculiar circumstances of the cases, which naturally differ from this. There is however another view of this case which appears to me unreasonable. The witness Oakley, testifies that the officer of the company told him he would take nothing but an actually subsisting bond and mortgage, that he made the application on behalf of Samuel Bayard, that the two younger Bayards, the mortgagors, under whom the title to the defendants is derived, always told him it was given for subsisting indebtedness to their father, and that the father had agreed to re-lend them the proceeds which amounts to their interest in the matter; in addition to being from their relationship not at all unlikely to have been selected as agents. Besides the witness, Servoss, states he delivered to the company, when he obtained the sterling bonds, a sworn statement by the mortgagee that he was the owner of the mortgage. Here, at all events, was a representation to the company, even if it THIS was an action of covenant. It apwere not proved to be true that the mort-peared that the defendant, William Mcgage was subsisting, and on the strength Allister, hired of the plaintiff the premises of Rapelye v. Anderson, 4 Hill, 472, they No. 173 Chatham-street, for five years, had a right to buy it at any price, but if and executed the ordinary tenant's agreeto this we add the doctrine laid down in ment under seal, dated the 7th February, Holmes v. Williams, 10 Paige, 326, and 1835. It also appeared that James BelMcKnight v. Wheeler, 6 Hill, 492, that lis, one of the firm of McAllister & Co., nemo debet credi allegans suam turpitu- (while Samuel McAllister was in Europe,) dinem," it is too late to deny facts on signed the contract of suretyship under which they obtained from the complain-seal as McAllister & Co. William McAlants for their own benefit, the contracts lister died about one year after the comor bonds, which has involved them in the mencement of the term, and his represen
In an action against sureties for rent of demised premises, the proof of the tenant's agreement for the hiring, by which it appears that rent had become payable under the contract, is prima facie evidence of the indebtedness for rent. Where an agreement to become surety for rent is signed by one partner, with the partnership named, while the other partner was absent in Europe, it is sufficient for the plaintiff to show that after the return of the other partner he wrote a letter admitting that the firm had become such security, in order to hold both partners liable. Where the name of the firm is signed to a sealed instrument, it is not necessary in this state to prove a ratification under seal, but a parole ratification is sufficient.-Semble.