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7 Buch.

Borough of South Amboy v. Pennsylvania R. R. Co.

Metuchen Case, the width of Main street, in Metuchen, which was sought to be widened by the complaining borough, was not disputed by the railroad. Its width and limits at the crossing of Main street were precisely defined of record and not controverted, nor was there room for any controversy as to its lawful width. The reverse is true in the present case. I think that no other decision of our courts construing this section upon the point before us can be found, and I conclude that the question now raised must be regarded as one of first impression in this court.

It will be conceded that this statute does not, in express terms, confer upon the court of chancery authority to try or determine the fact of encroachment upon a highway by the railroad companies, asserted and assumed in the proceedings and decree before us, and I think the court will be slow to imply from those terms a legislative design to deprive the courts of law of any part of their ancient and exclusive jurisdiction to try such questions according to the course of the common law.

One of the cardinal rules of statutory construction is to regard the effect and consequence of the law. A long array of authority has denied to courts of equity the right to entertain suits where there is a substantial dispute over the title to land, or over legal estates of easement in lands-a right which has hitherto remained within the exclusive cognizance of the courts of law of this state.

The number and uniformity of these adjudications are such that an intent on the part of the legislature to create so important a change and transfer of jurisdiction from law to equity, as was attributed to this act, by the court below, seems to us to be unwarranted by its language and clearly untenable. It should be added, lest the point might be thought to have been overlooked by this court, that if the purpose of the statute had been to confer such authority upon a court of equity, it would have been constitutionally invalid under the doctrine of Jersey City v. Lembeck, 31 N. J. Eq. (4 Stew.) 255, and the cases which have followed it. It is a familiar rule of the construction of statutes that the court will not declare void an act of the legisla

Borough of South Amboy v. Pennsylvania R. R. Co.

77 Eq.

ture for unconstitutionality when a construction can be given to it which will not have that effect.

Referring to some of these authorities, upon the question of equity cognizance, it will be seen that in Todd v. Staats, 60 N. J. Eg. (15 Dick.) 507, this court held that “when the fundamental right, on which the complainant prays equitable relief is the legal title to an easement in lands of the defendant, and that right is in substantial dispute, the establishment of the right at law is necessary to justify the interference of a court of equity.”

In the leading case of Hart v. Leonard, 42 V. J. Eq. (15 Stew.) 416, it was held by this court that "a substantial dispute over a private legal right in land is not ordinarily cognizable in a court of equity.” In that case the bill averred that the complainant was the owner of a lot of land, and that he and his predecessors in title had, by adverse user for over twenty years, acquired a right of way across the lands of the defendant from a certain public road to said lot; that the defendant obstructed said way, and the bill prayed a decree that the complainant was entitled to the way, and a mandatory injunction commanding the defendant to remove the obstruction and allow the defendant to pass through. This court, in its opinion delivered by the late Mr. Justice Dixon, said: “From the foregoing statement it appears that the claim set up a purely legal interest in lands, resting upon a purely legal basis. Before attempting to determine the validity of the claim, it is proper to consider whether the question presented comes within the cognizance of a court of equity.” After classifying the cases in which courts of equity may, by decree and injunction, protect and enforce legal rights in lands, the opinion declared that the case did not come within any of those classes, because the evidence showed "a substantial dispute over the fact of adverse user which the defendant is entitled to have settled by the verdict of a jury.”

In a later case, affirmed by this court on appeal, of Delaware, Lackawanna and Western Railroad Co. v. Breckenridge, 55 N. J. Eq. (10 Dick.) 141, 593, it was held that "a court of equity is without jurisdiction of an action to enjoin a continued trespass in lands by the maintenance across them of pipes laid under the

7 Buch.

Borough of South Amboy v. Pennsylvania R. R. Co.

surface, where the right to relief depends on the question of the complainants being the owner of the legal title to the land, which has not been determined by a court of law, the trespass being one not involving irreparable injury, and one for which an action in ejectment affords full and complete relief."

In Millville Gas Light Co. v. Vineland Company. 72 N. J. Eq. (? Buch.) 309, it is declared that “where the basis of a bill in equity is the refusal of defendant to yield to complainant the enjoyment of his legal estate in lands, and the title of complainant is in dispute, it is well settled that equity will not entertain jurisdiction until the title is first established at law." See, also, Palmer v. Sinnickson, 59 N. J. Eq. (14 Dick.) 5.30, and the cases cited, supra, on page 247 of this opinion, and Ballantine v. Harrison, 35 V. J. Eq. (10 Stew.) 560, 561, where Chief-Justice Beasley's opinion, in this court, declares that “when an injunction is asked for as auxiliary to the maintenance of a legal, in contradistinction to an equitable right, the rule is entirely settled that such preventive process will never be issued except to preclude irreparable damages,"

and “even when such intervention occurs, equity will not take to itself jurisdiction over the legalities of the controversy, but will content itself with conserving the subject of dispute, pending the litigation at law," &c.

For the reasons given, I think the decree below should be reversed.

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For affirmance- None.

For reversalTHE CHIEF-JUSTICE, GARRISON, SWAYZE, TRENCHARD, BERGEN, VOORHEES, MINTURN, BOGERT, VREDENBURGII, VROOM, GRAY, DIL, CONGDON—13.

Washington National Bank v. Beatty.

77 Eq.

WASHINGTON NATIONAL BANK, complainant and appellant,

v.

David C. BEATTY and GEORGE MCCLELLAN BEATTY, defendants

and respondents.

(Argued November 26th, 1909. Decided June 21st, 1910.)

1. The statute relating to fraudulent conveyances extends its protection to all persons having a valid cause of action or suit for damages arising from torts as well as from contracts, but a tort claimant, to be entitled to the protection of the statute, must reduce his claim to judgment. When his claim has thus been established, a conveyance made after the liability accrued and before suit may be set aside, on the theory that such judg. ment, when once obtained, relates back and becomes a debt as of the time when the original cause of action accrued, thus constituting him an existing creditor.

2. A voluntary conveyance is void by force of the statute with respect to existing debts. When attacked by a subsequent creditor, fraud as a fact must be proven. It must be shown that the conveyance was intended to defraud some creditor either existing or subsequent. If the conveyance be thus shown to be fraudulent it may be set aside at the instance of any creditor existing or subsequent. It is not necessary for the subsequent creditor to show that the deed was made with the intent to defraud such persons as should, subsequent to its date, become creditors of the grantor, overruling on this point Gardner v. Kleinke, 46 N. J. Eq. (1 Dick.) 90; explaining and following Hagerman v. Buchanan, 45 N. J. Eq. (18 Stew.) 292.

On appeal from a decree of the court of chancery advised by Vice-Chancellor Howell, whose opinion is reported in 75 N.J. Eq. (5 Buch.) 433.

Mr. Oscar Jeffery, for the appellant.

Mr. Elmer King, for the respondents.

The opinion of the court was delivered by

DILL, J.

This appeal from the court of chancery brings up for review a judgment dismissing the bill in a creditor's action to set aside

i Buch.

Washington National Bank v. Beatty.

a voluntary conveyance of real estate. The bill charges the transaction as being “in violation of the statute entitled 'An act for the prevention of frauds and perjuries,' approved March 27th, 1874."

There is no element in the case, either by way of pleading or proof, that the complainant bank gave any credit to the defenůant relying upon his ownership of the property in question. The answer, denying the material allegations of the bill, specifically raises the issue that the firm of commission merchants, hereinafter referred to, were not, at the time of the conveyance or subsequently, creditors of the defendant within the purview of the statute.

The essential facts of the case are within a narrow scope.

In 1894 David C. Beatty, a farmer, consigned certain farm produce to a firm of commission merchants in New York. They failed to remit the proceeds.

Beatty, in his wrath, exposed to public view a card on which he had written “All fruit shippers beware of” (naming the commission merchants). “They are damned frauds.”

Two days later the commission merchants wrote, threatening to sue him for $100,000 damages. This so alarmed the farmer that he put his property out of his hands, transferring the farm which he owned and the mortgages he held on another farm to his son, without consideration, and at once duly recorded the conveyances. The complainant offered no evidence to controvert Beatty's statement that the commission merchants were frauds in that they converted to their own use proceeds due him. The case shows affirmatively that the commission merchants never did more than to threaten Beatty, and never proceeded, in any way, to establish the verity of their claim for damages, nerer sued him and never obtained any judgment against him, but were content to let the matter stand in statu quo until the statute of limitations had intervened. Admittedly, Beatty made the transfer for the purpose of making himself judgment-proof against these commission merchants, if they should sue him and if the judgment should go against him.

There is no evidence of any other claims or debts against Beatty.

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