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7 Buch.

Freeman v. Island Heights Hotel and Imp. Co.

thus raising here the main ground of contention set out in its answer and submitted to the court below for its determination.

Another ground for reversal it is claimed exists because the decree affects the rights of persons not parties to the suit. This is rested upon the fact that although after the dedication and purchase by complainant, the association dedicated two parcels of land, part of the camp meeting ground, of the width of thirty feet for public streets, and also conveyed a small lot thirty feet wide fronting on the river to Angelina D. Brinley, who subsequently conveyed it to James Bryant, the present owner, neither the borough of Island Heights or Bryant are made parties to this suit, and as the decree adjudges that the streets and the Bryant lot were dedicated to camp meeting grounds, the rights of the borough and of Bryant have been affected without giving them an opportunity to be heard. As to the Bryant lot the bill of complaint sets out its conveyance in 1893, and that it was a part of the camp meeting lot as shown on the map of 1881, revised in 1886, but the decree includes the lot as a part of the land adjudged to be devoted by dedication to camp mecting purposes, and to affirm this decree as it stands would adjudge the rights of one not a party. The want of proper parties was not raised below, but this court will not determine the right of the complainant against those not called upon to answer the claim established by the decree. McLaughlin v. Van Keuren et al., 21 V. J. Eq. (6 C. E. Gr.) 379. As to the streets, it appears that in 1883 they were dedicated by the Island Heights Association "for the free and unobstructed use of the public of the borough of Island Heights,” by a deed duly executed and recorded, since which time they have been controlled by the borough and all work on them has been done and paid for by it. This does not appear to be denied by the complainant, and he having acquiesced in this control by the borough for over twenty years, it will be assumed that he has waived any implied covenant he had to have the streets devoted to camp meeting purposes. The decree should therefore be so modified as to exclude from the adjudication the streets and the Bryant lot, and limited to that land which appellant claims to own in fee-simple. It is also urged that the decree should be reversed because it enjoins the trespass suit against the

Home for the Friendless v. Traders' Investment Co.

77 Eq.

complainant's son, who is a joint defendant therein. No such objection was raised below by any pleading, nor is it mentioned in the petition of appeal as a ground for reversal, and as the defendant here has put its right to prosecute both father and son as joint defendants in the suit at law upon the ground that it has an absolute title to the land, free from the implied covenant claimed, no such injustice is done it by the decree in this particular as to require the entertaining of this question for its protection, notwithstanding it was not raised below. In order that the decree may be modified as indicated in this opinion, it will be reversed and the record remitted to the court of chancery for the purpose of such modification. As the appellant has been obliged to come to this court to correct the decree, it should have costs on the appeal including printing.

For affirmance-None.

For reversal-THE CHIEF-JUSTICE, GARRISON, SW AYZE, TRENCHARD, PARKER, BERGEN, VOORHEES, MINTURN, BOGERT, VREDENBURGH, DILL, CONGDON—12.

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THE ASSOCIATION TO PROVIDE AND MAINTAIN

THE FRIENDLESS, respondent,

TRADERS' INVESTMENT COMPANY, appellant.

[Argued June 30th, 1910. Decided November 14th, 1910.)

The release by a prior mortgagee of part of his security, although it operate to the disadvantage of a subsequent lienor, will not impair the lien of the mortgage to the amount of the value of the security released, un. less such prior mortgagee had, at the time of releasing, knowledge, actual or constructive, of the existence of the subsequent lien.

Buch.

Home for the Friendless v. Traders' Investment Co.

On appeal from an order of the court of chancery advised by Vice-Chancellor Howell.

Mr. Samuel F. Leber, for the appellant.

Mr. Frank Benjamin, for the respondent.

The opinion of the court was delivered by

VOORHEES, J.

This is an appeal from a decree of the chancellor, dismissing a petition praying that the final decree in a foreclosure suit instituted by “The Association to Provide and Maintain a Home for the Friendless" be opened or the amount due to the complainant therein be re-examined, and for further relief.

The foreclosure bill was filed July 8th, 1909, to enforce a mortgage given by one Ankin in October, 1906. It set out a second mortgage for $1,000, also given by Ankin and the assignment thereof to the petitioner; the subsequent foreclosure of the petitioner's mortgage and the acquisition thereunder by the petitioner of title to the mortgaged premises by sheriff's deed on June 12th, 1909.

The petition also shows that the complainant held as collateral to its mortgage a policy of insurance; that before the filing of the bill, there had been damage by fire to the building upon the mortgaged premises; that the insurance company had settled the loss for $525, by a check payable jointly to the complainant and the owner: that the complainant had endorsed the check and delivered it to the owner who appropriated the money and failed to repair the building; and that the complainant had not given credit upon its mortgage for the payment thus made.

The petitioner had failed to answer the bill, and in consequence thereof a decree pro confesso had been taken. Its failure to answer is sought to be accounted for as the neglect of its solicitor, induced by a verbal agreement on the part of the complainant's solicitor, unkept, to allow further time for the purpose of answering

Home for the Friendless r. Traders' Investment Co.

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The petitioner contends that the amount of insurance thus collected and paid over to the owner should go in reduction of the amount due upon the complainant's mortgage. This, undoubtedly, would be so is the complainant, at the time of paying the money over to the owner, had knowledge, either actual or structive, of the existence of the second mortgage held by the petitioner. The recording of the mortgage is not constructive notice. There is no proof that the petitioner had actual knowledge. The release by a prior mortgagee of part of his security, although it operate to the disadvantage of a subsequent lienor, will not impair the lien of the mortgage to the amount of the value of the security released, unless such prior mortgagee had, at the time of releasing, knowledge, actual or constructive, of the existence of the subsequent lien. See Davis v. Cressman, 57 N. J. Eq. (12 Dick.) 619.

To open a decree, thus regularly entered, was a matter of grace, and the relief was rightly denied in the absence of proof of such knowledge on the part of the complainant, which was necessary to make the application of the petitioner meritorious.

The decree should be affirmed.

For affirmanceTHE CHIEF-JUSTICE, GARRISON, SWAYZE, TRENCHARD, PARKER, BERGEN, VOORHEES, MINTURN, BOGERT, VREDENBURGH, VROOM, DILL, CONGDON—13.

For reversal-None.

7 Buch.

National Fire Proofing Co. v. Daly.

NATIONAL FIRE PROOFING COMPANY, complainant-respondent,

V.

WILLIAM H. DALY et al., defendants-appellants.

(No. 21.)

NATIONAL FIRE PROOFING COMPANY, complainant-respondent,

V.

WILLIAN H. DALY et al., defendants-appellants.

(No. 22.)

NATIONAL FIRE PROOFING ('OMPANY, complainant-respondent,

V.

WILLIAM H. DALY et al., defendants-appellants.

(No. 23.)

WILLIAM C. FOSTER, trustee in bankruptcy, &c., complainant,

V.

BOARD OF EDUCATION OF HOBOKEN, defendant.

(No. 21.)

[Argued June 22d and 23d, 1910. Decided November 14th, 1910.1

On appeals from a decree of the court of chancery advised by Vice-Chancellor Stevens, whose opinion is reported in 76 V. J. Eq. (6 Buch.) 35.

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