Clinton National Bank r. Stiger. 67 Eq. present complainant and afterwards conveyed to the Temple Company, by which it was again mortgaged under a scheme of reorganization, which materially changed the original situation. I cannot perceive how any equity possibly existing in the original vendor could be administered without injury to other innocent persons; still, if it could, it seems to me that any such equity was extinguished by the foreclosure of the first mortgage held by the Penn company, for in that proceeding all subsequent encumbrancers were made parties, and if the present complainant had any claim on behalf of the bondholders, such as is now set up, viz., that actual annexations to the freehold were subject to the lien of the certain vendors prior to the right of the first mortgagee, it was its duty to then make the claim, and not wait until after sale and purchase to seek an establishment of it. If such a right exists, it is enforceable against all bondholders, as well as against the purchaser, the present defendant, and if carried out would permit certain bondholders to withdraw the mortgage security to the injury of other holders of like securities. I will advise a decree in accordance with my conclusions as above expressed. CLINTON NATIONAL BANK v JOHN N. STIGER. [Filed October 8th, 1904.] 1. After the loss of three cashier's checks the bank offered to pay the amount due thereon, which was not disputed, on being indemnified against having to pay the original checks. The payee afterward began a suit at law on the checks without tendering indemnity.-Held, that equity has jurisdiction to restrain such suit and to adjust the rights of the parties. 2. Quære. Has a court of law jurisdiction over a suit on a lost check? 1 Robbins. Clinton National Bank v. Stiger. On bill for injunction. Messrs. Dungan & Reger, for the complainant. Mr. James L. Griggs, for the defendant. BERGEN, V. C. It appears from the bill of complaint in this cause that the defendant left with the complainant $1,313.75, for which he received three cashier's checks, payable to his own order, two dated September 3d and one September 25th, 1903; that on the 15th day of December, in the same year, the defendant applied to the complainant and demanded new bills of exchange or cashier's checks in the place of those mentioned, or their equivalent in money, alleging that the original checks had been lost or stolen; that the complainant offered to immediately give to the defendant new bills of exchange or the money, as he might desire, upon the execution and delivery by the defendant to the complainant of sufficient security to indemnify the complainant against loss, if it should thereafter be required to pay the original checks; that the defendant refused such indemnity, and has commenced a suit against the complainant in the supreme court of this state to recover the amount due upon said cashier's checks, alleging in his declaration in that suit that the checks were lost or stolen. The complainant seeks to have the suit at law enjoined, upon the ground that it now is and always has been ready and willing to pay to the defendant the moneys represented by such lost checks, or to issue to him new cashier's checks in the place of those said to be lost, upon being indemnified against being required to pay the original checks, and so tendered itself when knowledge of their loss was first brought to its notice, and that the conduct of the defendant in refusing the indemnity and in bringing the suit, thus casting upon it the burden of paying costs, without offering indemnity, is unjust and inequitable. Until the enactment of the law to be found in section of our general act concerning promissory notes, suits for the recovery of money due upon an obligation which was Clinton National Bank v. Stiger. 67 Eq. lost were exclusively the subject of equitable jurisdiction, where indemnity might be required. On the return of the rule allowed in this matter, the defendant resisted the granting of a preliminary injunction restraining his suit at law, upon the ground that under the statute last referred to he is entitled to maintain his action. This section is peculiar in its phraseology; it permits the action at law upon a negotiable instrument which is lost, and then uses the following language, "but any court of law shall give judgment in the same manner as if such note was not lost," leaving it questionable whether it was the intention of the legislature to have the act apply to any negotiable instrument other than a note. The act further provides that any court of law may make the same order as a court of equity would to indemnify the party charged against the repayment thereof. It has been determined, in Force v. Elizabeth, 27 N. J. Eq. (12 C. E. Gr.) 408, that this court is not deprived of any part of its original jurisdiction in matters of this character because the law courts may exercise the same or a similar jurisdiction. This being so, the question arises, should this court interfere in this case. After careful consideration of all the circumstances, I am of the opinion that this cause should be retained in this court. The instruments sought to be recovered upon are not promissory notes, but bills of exchange, and it is certainly a debatable question whether the use of the word "note," in the latter clause of the seventh section of the act relating to promissory notes, does not limit the power given in the section to suits upon lost promissory notes. The conduct of the defendant in this matter has certainly been unjust, for the complainant has only asked from him the indemnity which he would be required to give in any court, whether of law or equity, and it is certainly unconscionable to permit him to compel this complainant to pay the costs of a common law judgment when it is in no equitable default. If the defendant had acted as a reasonable man should, and tendered the indemnity he is equitably bound to give, the money would have been paid to him without question. Were the amount due in dispute, it would be quite proper that he should appeal to a court of law to have 1 Robbins. Higgins v. Jamesburg Mutual B. and L. Ass'n. the amount due settled and ascertained, but as no such question arises here, and as this court has ample jurisdiction and power to equitably adjust the rights of these parties, I shall advise that a preliminary injunction issue according to the prayer of the bill. If, upon final hearing, the facts as they now appear remain undisturbed, the amount due to the defendant can be decreed to be paid, upon his furnishing the indemnity necessary to protect the complainant from further loss. I will advise the proper injunction order. MARGARET A. HIGGINS, administratrix, &c., V. THE JAMESBURG MUTUAL BUILDING AND LOAN [Filed October 11th, 1904.] 1. The record of an assignment of a mortgage is constructive notice of its existence and contents to one who takes a subsequent mortgage on the premises, and also that the assignor has no authority to procure the cancellation of the assigned mortgage. 2. The administratrix of a deceased assignee of a mortgage is not estopped to set up the existence of the mortgage, where the assignor obtained possession of it from her by false representations as to his right to it and purpose in obtaining it, and then caused it to be canceled of record and gave a new mortgage on the lands. On bill to restore the lien of a canceled mortgage. Mr. Freeman Woodbridge, for the complainant. Mr. John T. Rossell, for the defendants. Higgins v. Jamesburg Mutual B. and L. Ass'n. BERGEN, V. C. 67 Eq. Martha Dickens executed and delivered to her son, David, a mortgage on lands in Middlesex county, to secure the payment of $600, which the son duly assigned to James S. Higgins, in consideration of $600, advanced in two parcels of $300 each, the second payment being about one year after the first. When the first payment was made a deed of assignment was executed by David, transferring to Higgins one-half of the mortgage, and when the second payment was made, another deed of assignment was executed, transferring the balance due on the mortgage; both deeds were duly recorded in the office of the clerk of the county of Middlesex. James S. Higgins died, and among his assets were found the mortgage, with the bond it was given to secure and the two deeds of assignment, and all came into the custody of the complainant as his administratrix. In the month of February, 1901, Martha Dickens and her son, David, applied to the defendant the Jamesburg Mutual Building and Loan Association for a loan of $600, to be secured by a mortgage upon the same lands. The solicitor of the building and loan association examined the records in the office of the clerk of the county of Middlesex and discovered of record the complainant's mortgage, but did not search for any assignment of this mortgage; had he done so, he would have found that the complainant's mortgage had been duly assigned to James S. Higgins in his lifetime. The solicitor was a witness and testified that he did not examine the records for assignments of mortgages because he had been told by David Dickens of the existence of the mortgage, and also that it had been paid. After preparing a bond and mortgage, the solicitor went to the house of Martha Dickens, near Monmouth Junction, procured the execution thereof by her, and told David that before they could have the money the previous mortgage for $600 must be canceled, whereupon David said that he thought he had the mortgage in the house and left the room to get it, but after a short time returned and said that the mortgage was in a safe at Monmouth Junction: they then drove to Monmouth Junction, and the solicitor waited in a hotel while David went for the bond and mortgage. After |