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then belonging to the relator then amounted to $4,6.5,326.07, and from that sum it was claimed should be deducted the amount assessed against it for its real estate, being $451,300, and the sum of $2,500,000 for bonds issued by it, and also $2,567,000 for further indebtedness incurred by it in the course of its business, thus claiming a total of deduction for indebtedness (including the assessment for real estate, of $5,518,300,) or almost a million of dollars of debts over assets, and reducing the assessment, of course, to nothing.

It does not appear that any receiver of the company has been appointed or applied for, or that any proceedings have been taken or were contemplated for the winding up of what, by these statements, would appear to be a hopelessly insolvent concern. The president of the company was examined in regard to the assessment of 1893, before the commissioners, and he testified that the company was organized August 27, 1892, less than seven months prior to the making of this statement. The president further testified that the nominal capital was $5,000,000, $2,000,000 of preferred and $3,000,000 of common stock; that $2,000 in cash were paid into the treasury for twenty shares of its capital stock at par, and that sum was paid out for corporation expenses. He was unable to state whether in issuing the stock at the time the company was organized it acquired anything beyond the tangible assets of the firm or parties whose property was purchased. The first meeting of the directors was held August 27, 1892, and at that meeting its bonds ́secured by mortgage were issued, and 820 of them, of $1,000 each, were sold for cash at par, and the money brought into New York and deposited in the bank with which the company did business, and was subsequently used for the purchase of merchandise used by the company. The question was then asked of him: "And the rest of the capital stock and the balance of the bonds were issued in exchange for real and personal property?" and he answered "Yes."

From this statement of 1893, and from the examination of the president of the company, it appears that all but $2,000 of its capital stock of $5,000,000, and the $2,500,000 of its bonds, had been issued in exchange for property, real and personal, between 27th day of August, 1893, and the second Monday of January, 1894, the cash for the $820,000 of bonds issued having been used for the purchase of merchandise. Further than this, it appears that $2,567,000 of further indebtedness had been in curred upon its notes for borrowed money, loans to it on collateral and on bills for merchandise. This would make about $10,000,000 invested by the relator within this short period, and yet it makes a statement that its total gross assets existing on the second Monday of January, 1893, amounted to but

$4,615,326.07. No explanation is vouchsafed for these seemingly most unfortunate investments. It might, perhaps, be thought there was a mistake in the record from which I have quoted, and that the stock had, in fact, never been issued to any such amount. The statement for 1894 would seem to show there was no mistake of that nature, for it is there stated that the entire share capital, except the twenty shares already spoken of, and the entire issue of bonds, exc pt the 820 sold for cash, were exchanged for property. Ten millions of investments in five months, and at the end thereof less five millions left. In January, 1895, its relative condition was about the same; its gross assets had shrunk from $4,615,326.07 to $3,466,919. being considerably over a million of dollars, but its indebtedness was less by $1,046,500.

And yet this (seemingly) insolvent corporation is paying interest on its bonded indebtedness and dividends upon its stock. These facts call for explanation. There is no doubt that the astute and able counsel for the city would have made the effort to obtain it had not the defendants proceeded upon the theory as to the tax of 1894 that the amount of indebtedness was in any aspect immaterial, and the amount of assets in this State was sufficient for an assessment for 1894, which would be fair if no deduction for indebtedness were allowed. As to the assessment for 1893, in which there was some allowance for indebtedness, the relator claims that the

entire face value of three of the items entering into that assessment, viz., for machinery and tools, office furniture and horses and trucks, making a total of over $800,000, should have been deducted in addition to the amount already allowed by the defendants for indebtedness incurred for the purchase of assets in this State. The decision of the defendants in this regard as to what amount of indebtedness was actually incurred in the purchase of the assets in this State in 1893 was made upon a question of fact, in regard to which the evidence on the part of the relator was by no means of that clear and convincing character which could leave no doubt as to the fact. The assessment itself depended also upon the different kinds of property making up the assets of the relator in this State, and it was not made at all plain as to what the real and true value of such assets was. We do not feel called upon to review and reverse the determination of the defendants as to the true amount for which the relator should be assessed for the year 1893. There was some evidence to support their determination, and that is sufficient for us. It is not plain that any erroneous theory of assessment adopted.

was

The orders of the Special and General Terms will, therefore, as to that assessment, be affirmed.

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We are now brought to the consideration of the assessment for 1894, founded upon the ThurberWhyland Company case above referred to.

We think an erroneous use has been made of the decision of this court in that case, and that the assessment now before us for 1894 must be set aside. Upon another examination of the question, carried on by the defendants, commissioners, a more thorough investigation may be made, so far as it shall appear necessary, for an accurate assessment against the relator for all sums invested by it in this State. The question is as to the true construction to be given those words of the statute which provide that all persons non-residents of the State and doing business herein "shall be assessed and taxed on all sums invested in any manner in said business the same as if they were residents of this State," etc.

The case of the Thurber-Whyland Company held that a foreign company having assets in a foreign State could not invest some of its capital here and rightfully claim a deduction from such sum invested of all its indebtedness. That company admitted an investment here of at least $750,000, and its total indebtedness was over $1,200,000, consisting of open accounts and of bills payable. There was no claim set up as to the right specially to deduct the specific indebtedness arising upon the purchase of the very assets in New York in regard to which the assessment had been made. Very possibly language was used in that case in the course of the opinion which might be capable of a construction broader than was called for by the facts appearing in that record. If so, it would be but another illustration of the truth and importance of the principle which makes it necessary to construe the language used in judicial opinions strictly with reference to the facts which exist in the case which is decided. It was stated in that case that the Court was of opinion that the act did not contemplate the deduction of debts from the sum invested in this State by non-residents. As then applied, the language was appropriate, although it might well have been more definite and precise.

That company had assets at its home office enough to permit a reduction of all indebtedness asserted, and there was no claim that was argued that any of it had been incurred in the purchase of property in this State, which formed the basis of the assessment. Under such circumstances we held, and, as we think, properly held, that the place for the deduction of general indebtedness was the residence of the person or corporation, and that the sum invested here should not be diminished by a deduction of any part of such general indebtedness.

The question we are now to decide is, what is the sum invested in this State by a foreign corporation which purchases property here and pays cash for a

portion of it, and promises to pay the balance at some future day? This relator is engaged in the business of milling in this State.

Suppose it brought $100,000 into this State and bought $200,000 worth of wheat to be manufac tured into flour, and paid for it with the $100,000 in cash, and gave its notes for the balance, the ownership of the wheat passes to the relator by the purchase, and in that sense it can be said it owns wheat to the amount or value of $200,000. Has it, however, under this statute, invested in this State any sum beyond the $100,000 which it paid in cash for the wheat? Is its promise or liability to pay the other $100,000, a sum invested in this State by it, and is it the same as cash for the purpose of taxa tion? Is the fact that the company has in its possession as ostensible owner the $200,000 in value of wheat conclusive evidence that the company has invested that sum in its business in this State, when in truth it has paid a sum amounting to but half its value, and has promised to pay the balance at some

future time? It seems to us there can be but one answer to these questions. The sum invested is the sum paid, and not the sum which is promised to be paid on a future occasion. It is true the purchaser has in its possession wheat to the value of $200,000, but it cannot be said to have invested $200,000 in the purchase of the wheat as long as it has in fact paid but one-half that sum and has simply promised to pay the other half at a future day.

No part of the value of the wheat is lost to taxation by this holding; neither is the sum which was brought into the State by the relator and invested in the wheat. The vendor of the wheat is taxed for the $100,000 he has received as part payment for the same, and he is also taxed for the $100,000 of notes he has received from the purchaser of the wheat on account of the balance due for the purchase money, and the relator is taxed the $100,000 cash it has brought into the State and invested in this wheat, and there is thus an assessment of $300,000 made between these two, the vender and the vendee of the wheat, and that is all the property that is then subject to taxation. To tax the full value of the wheat in the hands of the purchaser is, in reality, to tax the purchaser on its own indebtedness. Its promise to pay in the future the other $100,000 is not a sum invested by it here until it has redeemed its promise and paid its notes. The transaction is, in truth, substantially the same, whether the payment has been secured by a chattel mortgage on the wheat or not, although, if the payment have been thus secured, the purchaser has not even obtained an unincumbered title to the wheat until the payment is made. And so long as the property purchased has not been paid for in full, then the amount still due upon it ought to be de

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ducted as not representing any sum invested by the purchaser in this State. Otherwise it is to say that the relator has invested a sum in this State by merely promising to do so at some future day. If after the purchase the wheat should appreciate, the whole of such appreciation would of course go toward swelling the amount invested by the relator in this State, and the contrary would be the case if it should depreciate; the indebtedness being a fixed quantity in both cases, it would not be altered or affected by either event.

The same thing would happen in case the relator purchased the wheat and paid nothing for it, but gave its notes even without a mortgage for the whole amount. In such case the relator could not be said to have invested any sum in its business, assuming, of course, that the wheat was worth no more than its purchase price. Instead of paying, it had simply promised to pay for it. The vendor in such case would be assessed on the notes he took for the price of the wheat instead of for the wheat T itself and the relator would not be assessed at all. This would be right, because no more property had been created by the sale than existed before its consummation, and there would be an assessment levied for the full amount that had been levied before or which would have been levied if no sale had been made. The relator would not have invested any sum in its business until it paid something on its notes or until the property purchased had appreciated beyond the purchase price thereof. A gift of the property would be different. In that case while the relator would not have actually taken money or brought it into the State for investment and invested it in the property, yet it would have received the property as absolute owner, with no outstanding liabilities to pay for it, and being in such case the owner of the property, it would answer the description of a sum invested in its business and thus be liable to assessment under the act.

This treatment of the question is not in fact to be regarded in the light of a strict deduction of debts from assets; it is construing the meaning of the statute determining what in reality is the sum invested by a non-resident individual or corporation under these circumstances, in the business in which he or it is engaged in this State. It is not adjusting the equities as spoken of in the ThurberWhyland case, which we then held should be done at the place where the corporation was a resident. It is a different thing from ascertaining the general and gross assets of a non-resident to be found within the State, and from that sum deducting all its debts whenever and upon whatever cause incurred. The non-resident corporation investing a sum of money in this State is to be assessed for the full sum it invests here, although it may owe debts

enough outside of such investment to render it insolvent. The indebtedness it has incurred in the transaction from which the purchase of the property is the result is no part of the sum it has invested in such purchase, and no assessment can be made which includes the amount of that indebtedBut the stock which a corporation issues in payment for property is not a debt incurred by it. The scrip for the stock is merely a certificate to the holder to certify as to his interest in the property of the corporation, which interest is his share of the property that remains to it after the payment of all its debts.

ness.

Construing the statute as we do, it follows that the assessment of 1894 cannot stand. Upon a rehearing of the case by the assessors it will be most appropriate to endeavor to learn what kind of property was obtained in exchange for the stock, bonds and notes of the company amounting to ten millions of dollars; where it is situated, how much it is in fact worth or what has become of it and how it has to the extent claimed disappeared or shrunk in value. It is a case which indeed calls for rigid examination and investigation to learn, if possible, how a corporation seemingly by its prepared statements insolvent, can go on and pay interest on its mortgage debt, dividends on its stock and keep clear of all hostile steps from its other creditors.

Our conclusion is that the orders of the General and Special Terms in relation to the assessment of 1893 must be affirmed, with costs, and those in regard to the assessment of 1894 must be reversed, and the defendants directed to make a new assessment in conformity to the facts and to the views set forth in this opinion. All concur.

INTEMPERANCE OF SPEECH BEFORE JURIES.

The case of Holden v. Pennsylvania R. R. Co. in the Supreme Court of Pennsylvania (32 Atl. Rep., 103) once more calls attention to the use of violent and irrelevant language in summing up a case, as a ground for reversal of a judgment. The action was for damages for personal injuries sustained through a railroad crossing accident. Plaintiff's counsel in addressing the jury employed such expressions as corruption, ""death trap put there for the purpose of taking lives, a fellow (one of defendant's witnesses) bumming around town," a ghoul with a human face, ""terrorizing witnesses who swear against them," "lying with the hope of being paid," perjured, the tools of a company," "scoundrels.” The Supreme Court assigns, as one of the errors for

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reversal, the refusal of the trial judge to withdraw
a juror because of such language, which it pro-
nounced offensive and reprehensible, the same not
being warranted by any evidence in the case.
Whether an error of such character shall alone suf-
fice for reversal is a question upon which different
courts have not agreed. The better practice is for
appellate courts in all cases to consider the circum-
stances disclosed by the particular record under re-
view, and to order new trials only in the exercise of
a wise discretion, and not unless fair presumptions
arise that actual prejudice resulted. Such course
has been taken in several cases in various tribunals
during the past few years. A certain latitude of
comment should be allowed counsel, and average
intelligence should be taken for granted in the jury.
We have read some judicial condemnations of the
use of irrelevant and inflammatory remarks, which
were sweeping enough to debar a lawyer from quot-
ing the Bible or Shakspere, or citing ancient his-
tory, or, indeed, alluding to any possible thing
outside the record, for purposes of illustration.
Cases of this character should, however, impress
upon the counsel the duty of self-restraint.
judgment fully as many deserved verdicts are lost
as unjust verdicts stolen through intemperate cant
and abuse. If such style of speech do not actually
provoke an adverse verdict, it is at least apt to
cause a disagreement. A lawyer at nisi prius is
necessarily something of a courtier. Of course he
should not cajole or flatter any more than he should
browbeat or bully. But it is one of his legitimate
objects to produce a favorable personal impression
of himself and his client on the jury; to inspire
them with a friendly and sympathetic as well as re-
spectful feeling.

tion.

In our

have brought an audience into harmony with the speaker's sentiment as well as his opinions. These traits of our common Adamhood are overlooked by an advocate only at his client's peril. A counsel has no calling to discourse on the exceeding sinfulness of sin, or to accuse the opposite party of breaking all the Ten Commandments. A strong case can be won by soberly calling things by their right names, and we do not think that weak cascs are often won by passionate and maudlin rhetoric.

In many of the decisions in which this subject has recently been discussed, the language complained of was absolutely maudlin the mere cant of passionate vituperation. Counsel in the heat of oratory had flung out epithets as meaningless as the vulgar and obscene revilings of teamsters who get in each other's way on the street. Such language really signifies nothing more than that the speaker is beside himself. An Appellate Court should scrutinize the whole record carefully before deciding to reverse a judgment solely because the trial judge did not properly put a halter on a counsel's tongue. Undoubtedly a lawyer has no just cause of complaint if his own misconduct result in the overturning of a judgment in his favor. But the public may be put to needless expense by ordering a new trial of a case that has obviously been determined according to the merits. A trial judge, however, is always under a duty, both for preserv ing the dignity of the court and averting possible injustice, to restrain intemperate villification. And clients are very shortsighted who retain lawyers of ungovernable temper. We remember one case in which members of a jury, after rendering a verdict in the teeth of bitter invective, remarked to the successful counsel that regret was felt in the jury room because an additional award could not be given for defamation of character. - New York Law Journal.

DOCTRINE OF NEGLIGENCE.

Now, it is well recognized that reformers as a class are apt to be unpopular in their own generaThe future is the better for their lives and posterity does justice to their memory. But, even where reformers do not condemn particular individuals, but are impersonal in their assaults on ex- NEGOTIABLE INSTRUMENTS AND THE isting institutions, a certain prejudice against them is apt to be engendered. They shock comfortable conservatism, and the average man has difficulty in his mind of the notion that the reformer sets himself up to be as good as the ideal he advocates. When it comes to singling out and scourging individuals, the risk of unpopularity is greater. There will always be in many quarters a lurking sympathy for the under dog, no matter how justly he deserves all he gets, and a latent antagonism toward any man who assumes to act the censor and the judge. Intemperate denunciation will often produce a reaction in favor of the subject of attack, when a calmly argumentative arraignment would

THE judgments delivered by the Court of Appeal L. J. J.) in Scholfield v. Lord Londesborough, 43 W. R, 331, reveal an important difference of opinion as to the liability of the acceptor of a bill of exchange to subsequent holders. The action was to recover £3,500 on a bill of exchange drawn by F. C. S. Sanders and accepted by the defendant, the plaintiff being the holder of the bill in good faith and for value. When the defendant accepted the bill it was a bill for £500 only, and afterward, before indorsement, it was fraudulently altered by the drawer into a bill for £3,500. The bill bore &

£2 stamp, sufficient to cover £4,000, and the drawer had made the alteration of the amount of the bill an easy matter by leaving suitable spaces in the body of the bill, where the amount was stated in words, e and by leaving a space between the sign "£" and the figures "500" in the corner of the bill. The exact form of the bill, as drawn for acceptauce, can be readily understood from the report. The plaintiff claimed to recover the whole £3,500 from the defendant, on the ground that the latter was estopped from alleging the alterations by reason of his negligenee in accepting the bill in the form in which he accepted it, and on the bill stamp on which it was drawn.

To say that the defendant was estopped from setting up the alterations against the plaintiff is equivalent to saying that he owed a duty to the plaintiff, that by his negligent acceptance of the bill he had committed a breach of the duty, and that he was consequently liable to compensate the plaintiff. The case accordingly was treated as raising, first, the question whether the acceptor of a bill of exchange owes any duty to subsequent holders not to be negligent in respect of his acceptance of the bill. Assuming such duty to exist, there were the further questions whether the defendant had been in fact negligent, and whether the negligence was the proximate cause of the plaintiff's loss. Charles, J., answered the first question in the affirmative, but he held that there was in fact no negligence, and under section 64 (1) of the Bills of Exchange Act, 1882, he allowed the plaintiff to recover only £500, the amount of the bill when accepted. In

the Court of Appeals Lord Esher and Rigby, L. J., answered all three questions in the negative. There was no duty not to accept negligently; if there was, there was no negligence, and if there was negligence, it was not the proximate cause of the loss. Lopes, L. J., on the other hand, agreed with Charles, J., in holding there was a duty, but he also held that the acceptor had been negligent, and that his negligence was the proximate cause of the loss. Consequently he was of opinion that judgment should be entered for the plaintiff for £3,500. In the result the decision of Charles, J., affirmed.

was

ceived £352 2s. from the bank. The bankers subsequenty sought to debit the customer with the full amount, and the customer objecting, the matter was referred to an arbitrator. He found that the customer had been guilty of gross negligence and that he ought to make good to the bankers the loss they had sustained. His conclusion was brought before the Court of Common Pleas for review, and was unanimously supported. It was agreed that the customer was to blame, and that upon him, consequently, the loss ought to fall. "We decide here," said BEST, C. J., "on the ground that the banker had been misled by want of proper caution on the part of the customer."

The principle underlying Young v. Grote, has been the subject of much discussion. In Robarts v. Tucker, 16 Q. B. 579, Parke, B. said that the customer had, by signing a blank cheque, given authority to any person into whose hands it was to fall to fill it up in whatever way the blank permitted. In Bank of Ireland v. Trustees of Evans' Charities, 5 H. L. C. 413, Lord Cranworth, C., put the case upon the ground of. estoppel. "The case of Young v. Grote," he observed, "went upon the ground (whether correctly arrived at in point of fact is immaterial) that the plaintiff there was estopped from saying that he did not sign the cheque for £350; and if the circumstances are such. whether arising from negligence or from any other cause, that, as between the customer and his banker, the customer is estopped from saying that he did not sign the cheque for a particular amount, that, as between them, is just the same as if he had

signed it." In Ex parte Swan, 7 C. B. N. S. 446, Williams, J., after referring, inter alia, to the two last-mentioned cases, said that it seemed doubtful whether the cases as to the liability of a man who

signs a blank bill or note or cheque were founded

on the doctrine of estoppel, or on a rule of the law merchant that an actual authority is thereby conferred on the person in whose hands the instru

ment is.

Estoppel and implied authority are at best technical grounds. In Swan v. North British Australasian Co., 2 H. & C. p. 182. Blackburn, J., re* * that the The case which is chiefly relied on as showing ferred to "the broader ground * the existence of a duty under such circumstances person putting in circulation a bill of exchange as the present, is Young v. Grote, 4 Bing. 253. A does, by the law merchant, owe a duty to all parties customer of a bank gave his wife blank cheques to the bill to take reasonable precautions against the signed by himself, requesting his wife to fill up the possibility of fraudulent alterations in it;" and in blank according to the requirements of his business. the same case (ibid, 190), Cockburn, C. J., pointed She caused one to be filled up for the sum of out that while, under circumstances such as those £52 2s., but this was done in such a manner that it in Young v. Grote, the customer would be entitled was easy for the 52 to be turned into 352. She de- to recover from the banker the amount paid on the livered the cheque to her husband's clerk to be cheque, the banker having no voucher to justify the cashed. The clerk made the alteration and re- payment, yet the banker would be entitled to re

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