eree. It seems to have been assumed by both parties at the hearing that proof of such consents was necessary in order to maintain the proceeding; and, if the petitioner failed to make this proof, we ought not to disturb the decision below upon some other ground, or upon some new theory of the case.

The street railroad is about seven miles in length, and the line runs through a rural town and two villages. each having a distinct municipal government, and different authorities in charge of the highways. The crossing in question is wholly in the town, and the petitioner produced the consent of the highway commissioners of that town to the construction of the railroad. It is admitted in the opinion of the learned court below that this paper is sufficient in form and substance to meet all the requirements of law providing for the consent of the local authorities in control of the highway. Whether a steam railroad crossing a highway in the town should be intersected by a street railroad at the same point was a question to be determined by the authorities of the town in which the crossing was located. The authorities of some other town or village had no power to consent, and were not concerned with the question. The paper produced proved that, so far as the local authorities of that town were concerned, the petitioner was in the lawful use of the highway for the purpose of operating a railroad. In re People's R. Co., 112 N. Y. 578, 20 N. E. 367. We therefore concur with the learned court below with respect to the consent of the local authorities, and hold that the statute was complied with in that respect.

3. The petitioner's application has been defeated in the courts below on the ground that it failed to comply with the statute with respect to the consents of the requisite property owners on the line of the road in this same town. If, upon that point, the petitioner made the necessary proof before the referee, the proceedings should not have been dismissed. The petitioner produced at the hearing two separate instruments, which it is admitted were executed in proper form to express the consent of the abutting property owners in such cases, and these instruments were duly executed by the requisite number of persons in the town owning property of the required value on the line of the road. One of these papers is signed by 13 abutters, whereby they consented to the construction of a railroad on the highway by the petitioner, which had previously been incorporated. This paper is not challenged in any respect, but it is conceded that the parties who executed it did not represent the requisite amount of property on the line of the railroad in the town. Another instrument, signed by 30 abutters prior to the incorporation of the petitioner, was also produced. In this paper the property owners consented that two individuals named therein, their legal representatives and assigns,

might construct a street railroad in the highway. After the petitioner became incorporated the two individuals named in the consents assigned them, through other parties, to the railroad. These consents are, in form and substance, sufficient, unless they are inoperative by reason of the fact that they were procured by, and given to, the two individuals who were promoters of, and interested in, the construction of the road, instead of the railroad itself. It is admitted that these two instruments contain the consents of the owners of the requisite amount of property on the line of the road in the town, and the only question to be considered is whether the consents in the paper last described were invalid for the reason that they did not run directly to the railroad, but to individuals, through whom they were transferred directly to the railroad. The learned referee held that they were invalid, and in this ruling he has been sustained by the learned court below upon appeal. The reason for condemning these consents was that it would be contrary to public policy and to the spirit of the law to allow individuals to procure the consents to themselves, and then, as they might, sell them to the highest bidder. We think that this is a remote danger, at best; but, in any event, it should not be invoked to destroy consents given and acted upon, without some proof that the parties who procured them contemplated their use for purely commercial purposes. When it appears that consents were neither given nor received in good faith for the purpose of facilitating the construction of a railroad, but for some other purpose, not contemplated by the statute, the discussion of such a question might be timely. But no inference of that character can be drawn from the face of the papers in this case. It is common practice, and perhaps common prudence, for the projectors of a railroad to employ parties in advance to procure rights of way, consents, or like privileges to be used after the incorporation. The fact that the railroad acquires such rights through an intermediary by assignment, instead of directly from the property owners themselves, does not affect their validity. What the constitution and the statute requires in such cases is simply the consent of the property owner that the highway through his property may be burdened with another easement in the form of a railroad, and when such consent is fairly and in good faith given to one interested in the railroad, and by him transferred to the corporation, we are unable to see why it should not be treated and considered as valid as if it ran in terms to the railroad itself. The instrument in question contains a recital of the motives of the parties, if that is at all important. They all state that the projected railroad would be a benefit to them and to their property, and that for value received they are willing that it should use the high

way for its operations. We think that every purpose of the statute was complied with when the property owners gave the consents, and they were transferred by assignment to the corporation, and the railroad was constructed upon the faith of this action of the property owners. It is not open now to another railroad, for the purpose of defeating an application to cross its tracks, to impeach such consents as invalid. If there is any reason whatever to question the validity of such consents, that right should be limited to the state itself or to the property owners affected. Jones v. Town of Tonawanda, 158 N. Y. 438, 53 N. E. 280. The decision of the referee disposed of two applications by this petitioner to procure a crossing at two points in the town, one over the tracks of the New York Central, and the other over the tracks of the Fall Brook Railroad, of which the Central is the lessee. Both applications involved the same questions, and the proceedings in both were dismissed on the same ground. The order and judgment in both cases should be reversed, with costs, and the proceedings remitted to the special term for another hearing.

PARKER, C. J., and BARTLETT, HAIGHT, MARTIN, VANN, and LANDON, JJ., concur.

Order and judgment reversed, etc.

(163 N. Y. 340)

LOPEZ et al. v. ROWE et al. (Court of Appeals of New York. June 5, 1900.)

FRAUDULENT CONVEYANCES-DEFAULT JUDG

MENT-INSOLVENT CORPORATIONS-CREDITORS' SUIT-APPELLATE COURT-PRIORITY OF LIENS-EXECUTIONS-MISTAKE OF DEPUTYNUNC PRO TUNC ENTRY-APPEAL-REVERSAL WITHOUT NEW TRIAL.

1. Where plaintiff, who was an attaching creditor, filed a complaint to have judgments against his debtor in favor of defendants set aside, on the ground that such judgments were suffered to give the defendants a preference over other creditors of the corporation, which complaint was dismissed, the appellate court had no authority, on reversing the decision of trial court, to hold defendants' judgments invalid without awarding a new trial, since no opportunity was given to litigate the question of their validity.

2. Under Stock Corporation Law, 8 48, providing that when a corporation is insolvent, or its insolvency is imminent, no judgment shall be valid which is suffered by its officers with the intent to give a preference to any particular creditors over others, where defendants obtained judgments against an insolvent corporation in November, 1894, and on December 3, 1894, plaintiff levied on the property under an attachment, and there was no evidence that the officers of the corporation were guilty of any act other than mere nonresistance to the securing of the judgments to which it had no valid defense,--such judgments did not come within the condemnation of the statute, and hence were not invalid.

3. Under Code Civ. Proc. §§ 1406, 1407, giving preference to the execution first delivered, and making the same rule applicable where executions and warrants of attachments are lev

ied on the same property, where plaintiff filed a creditors' suit to set aside judgiñents obtained against an insolvent corporation, a part of which were set aside as suffered with the intent to prefer such creditors, and others were sustained, the setting aside of the invalid judgments in no way gave the plaintiff any right to a preference over those sustained as valid, but the liens of such creditors attached and existed according to their legal priority, since the invalid judgments were set aside, not only as to the plaintiff, but as to all creditors of the corporation.

4. Where appellants obtained liens on the personal property of an insolvent corporation by virtue of executions to satisfy judgments, the fact that such executions were returned "nulla bona" through the mistake of a deputy, and the returns so made were set aside "nunc pro tunc" as of the date when made, did not postpone appellants' liens in favor of a subsequent attaching creditor.

Appeal from supreme court, appellate division, Fourth department.

Action by Calixto Lopez and others against Charles H. Rowe and Frank Campbell, impleaded with the Merchants' & Farmers' National Bank of Dansville and others. A judgment of the special term dismissed the complaint as to Charles H. Rowe and Frank Campbell, and set aside judgments previously rendered in favor of the Merchants' & Farmers' Bank and the Manufacturers' & Traders' Bank against the Cohocton Valley Cigar Company as in preference of creditors, and awarded judgment to the plaintiffs in preference thereto; which judgment was reversed in the appellate division as to the dismissal in favor of Charles H. Rowe and Frank Campbell, and prior judgments in their favor against the Cohocton Valley Cigar Company held invalid as in preference of creditors, without awarding them a new trial; otherwise the judgment was affirmed. 46 N. Y. Supp. 91. From the judgment of the appellate division defendants Charles H. Rowe and Frank Campbell appeal. Judgment of appellate term reversed, and that of special term modified.

John F. Parkhurst, for appellants. David Hays, for respondents.

MARTIN, J. This action was brought by the plaintiffs, as attaching creditors of the Cohocton Valley Cigar Company, to set aside certain judgments obtained by the defendants against the corporation, upon the ground that they were suffered in violation of the provisions of section 48 of the stock corporation law. The Cohocton Valley Cigar Company was a corporation engaged in manufacturing cigars in the village of Cohocton, N. Y. The defendant banks and the defendants Campbell and Rowe were judgment creditors of that company. It had been doing a prosperous business until August, 1893, but, owing to losses amounting to $30,000 or more, it, as early as January, 1894, became insolvent. On November 28, 1894, three judgments were recovered against it,-one by Rowe for $416.92, another by the Merchants' & Farmers' Bank for $5,139.47, and still an

other by the Manufacturers' & Traders' Bank for $7,850.85. Two days later the Merchants' & Farmers' Bank recovered another judg-| ment for $321.57, and Campbell recovered two judgments amounting to about the sum of $8,000. All these judgments were regularly taken by default. Upon their entry executions were immediately issued and delivered to the proper sheriff, who levied upon all the tangible personal property of the company, and advertised it to be sold on December 6, 1894. On the 3d of that month the plaintiffs commenced an action against the Cohocton corporation, in which an attachment was issued and delivered to the same officer on the next day. The property thus levied upon was sold for about $5,000, $3,500 of which remains in the hands of the sheriff to abide the result of this action.

The special term dismissed the complaint as to Campbell and Rowe, in effect holding that their judgments were not suffered with an intent to give them preference over the other creditors of the corporation. It, however, set aside the judgments obtained by the banks, upon the ground that they were thus suffered, and consequently invalid. It also directed that out of the fund in the hands of the sheriff the plaintiffs should be paid the amount of their judgment. The plaintiffs appealed to the appellate division from that part of the judgment which dismissed the complaint as to Campbell and Rowe, and the latter appealed from so much of the judgment as directed payment of the plaintiffs' judgment out of the moneys in the sheriff's hands. The banks appealed from the entire judgment, but before argument abandoned their appeal. The appellate division dismissed the appeal of the banks, reversed the judgment of the trial court in favor of Campbell and Rowe without awarding a new trial, and affirmed the remainder of the judgment. From the judgment entered upon that decision Campbell and Rowe have appealed to this court. Thus the question presented here is the correctness of the decision in reversing the judgment of the special term in favor of the appellants, and in affirming the direction of the trial court to pay the plaintiffs' judgment out of the fund in the sheriff's hands.

The appellants now contend (1) that the appellate division erred in affirming that portion of the decision which directed the sheriff to pay the plaintiffs' judgment; (2) that the evidence was insufficient to justify the reversal as to them; and (3) that, even if sufficient, the court had no right to reverse their judgments without awarding a new trial.

It is obvious that the last contention must be sustained, as the appellate division had no authority to hold the appellants' judgments invalid without their having an opportunity to litigate the question of their validity. We have had occasion recently to examine the power of that court to determine facts which are not conclusively established

or found by the trial court, and to direct a judgment thereon. In re Chapman, 162 N. Y. 456, 56 N. E. 994; Benedict v. Arnoux, 154 N. Y. 715, 724, 49 N. E. 326. In those cases we held that upon reversal the court must grant a new trial, and cannot properly render a final judgment unless the facts are conceded or undisputed, or established by official record, or found by the trial court, or it appears that no possible state of proof applicable to the issue could entitle a party to a judgment, and that this rule applies to suits in equity as well as to actions at law. In the Benedict Case it was said: "It is one of the fundamental principles of our law that questions of fact are to be tried and determined in a court of original jurisdiction, and it is not the appropriate function of an appellate court to determine controverted questions of fact, and render final judgment upon such determination." The principle of those cases is decisive of this question, and requires us to hold that the appellate division had no power to reverse the judgment as to the appellants without awarding a new trial.

But the broader and more important inquiry is whether that court was justified in reversing the judgment as to the appellants. If the evidence is insufficient to show that their judgments were suffered by the corporation with intent of giving them a preference over other creditors, then it had no authority to reverse that portion of the judgment which was in the appellants' favor. The statute, so far as it is applicable to this case, may be thus paraphrased: When a corporation is insolvent or its insolvency is imminent, no judgment shall be valid which is suffered by any of its officers, directors, or stockholders with the intent of giving a preference to any particular creditor over other creditors. It is manifest that the purpose of this section was not to prevent the honest creditors of a corporation from enforcing their debts by action. Varnum v. Hart, 119 N. Y. 101, 23 N. E. 183; Throop v. Lithographic Co., 125 N. Y. 530, 534, 26 N. E. 743. In the case last cited Judge Andrews said: "We have recently held in Varnum v. Hart, 119 N. Y. 101, 23 N. E. 183, that the statute does not restrain one whose relation to the corporation is that of a creditor merely from availing himself of legal proceedings for the collection of his debt, and that he is entitled to a preference acquired in ordinary course of legal procedure, notwithstanding the insolvency of the corporation." See French v. Andrews, 145 N. Y. 441, 40 N. E. 214, and Bank v. Townley, 159 N. Y. 490, 54 N. E. 74. Although the statute has been recently amended, yet the rights of creditors in that respect remain the same. Obviously, the sole purpose of this statute was to prevent any improper act or omission on the part of a corporation or its officers which would result in securing to a particular creditor a preference over its other creditors. If

the corporation or its officers performed any act by which a creditor was enabled to obtain a judgment to which he was not entitled, or omitted to interpose any legal defense it had to his claim, and thus suffered an improper judgment against the corporation, the judgment so suffered would be invalid. But where a creditor has a just claim to which the corporation has no defense, and he adopts the ordinary process and procedure of the court to enforce it, which results in a judgment by default, it cannot be properly held to be within the condemnation of the statute. In Wilson v. Bank, 17 Wall. 473, 484, 21 L. Ed. 727, where a similar question arose under the bankrupt aet, it was said: "There is nothing morally wrong in their [the insolvents'] course in this matter. They were sued for a just debt. They had no defense to it, and they made none. To have made an effort by dilatory or false pleas to delay a judgment in the state court would have been a moral wrong and a fraud upon the due administration of the law. There was no obligation on them to do this, either in law or in ethics." The mere nonresistance of a debtor to judicial proceedings in which a judgment was rendered against him when the debt was due, and there was no valid defense to it, is not the suffering and giving a preference under the bankrupt act. Bank v. Warren, 96 U. S. 539, 24 L. Ed. 640. The principle of the foregoing decisions is applicable to the facts in this case, and, unless the corporation or its officers were guilty of some act besides the mere nonresistance to the appellants' efforts to obtain their judgments, their acts did not amount to the suf fering of a judgment, within the meaning of section 48.

Hence the question presented is whether the corporation or its officers performed any act which enabled the appellants to obtain judgments when they were not entitled to them, or omitted to interpose any valid defense which the corporation had. That the corporation had any valid defense to the debts upon which these judgments were rendered is not even pretended. Therefore the only point presented upon this branch of the case is whether there was any evidence to justify the conclusion that the corporation or its officers, with the intent of giving a preference to the appellants, performed any act which enabled them to obtain their judg❘ ments. Obviously the trial court found none, as it dismissed the complaint as to them. A careful and critical examination of the rec ord fails to disclose sufficient proof of any such act. There is no direct evidence showing it, nor were the circumstances sufficient to justify the court in finding it. While a material fact may be established by circumstantial evidence, still, to do so, the circumstances must be such as to fairly and reasonably lead to the conclusion sought to be established, and to fairly and reasonably exclude any other hypothesis. Where the evi

dence is capable of an interpretation which makes it equally consistent with the absence as with the presence of a wrongful act, that meaning must be ascribed to it which accords with its absence. In other words, it can only be established by proof of such circumstances as are irreconcilable with any other theory than that the act was done. As has been said: "Insufficient evidence is, in the eye of the law, no evidence." Jewell v. Parr, 13 C. B. 916; Pollock v. Pollock, 71 N. Y. 137, 153; Ruppert v. Railroad Co., 154 N. Y. 90, 47 N. E. 971; Morris v. Talcott, 96 N. Y. 100; Baird v. Mayor, etc., 96 N. Y. 567; Constant v. Rochester University, 133 N. Y. 640, 31 N. E. 26; Shultz v. Hoagland, 85 N. Y. 464.

When the evidence in this case is tested by these principles, it is wholly insufficient to establish any act upon the part of the corporation or its officers which would bring these judgments within the condemnation of the statute. The most that can be properly said of the evidence is that it might have justified the court in suspecting that some such act had been performed. But a mere conjecture or surmise was not sufficient to authorize a finding to that effect, either by the special term or appellate division. Laidlaw v. Sage, 158 N. Y. 73, 94, 52 N. E. 679, 44 L. R. A. 216. These considerations lead us to the conclusion that the evidence was insufficient to have justified the special term in finding, or to justify the appellate division in holding, that the judgments of the appellants were invalid because obtained in contravention of the statute. Therefore, in the further discussion of this case, the appellants' judgments must be treated as valid.

Another question presented relates to the affirmance of that portion of the judgment which directed the sheriff to pay the plaintiffs out of the funds arising from the sale of the personal property of the corporation under the executions in his hands. As the appellants' judgments were valid, the executions issued thereon were likewise valid, and by virtue of them they obtained a lien upon the personal property sold as of the time when they were delivered to the officer. Code Civ. Proc. §§ 1406, 1407. Therefore the liens of their executions were prior and superior to the lien of the plaintiffs' attachment, and should have been directed to be first paid. This is conceded in the respondents' brief, unless the plaintiffs acquired some added right by reason of their having brought this action, and procured the judgments of the banks to be set aside, or unless the appellants' liens have been released or destroyed. Did the plaintiffs acquire any superior right by reason of their having brought this action? It is to be remembered that the property sold was the tangible personal property of the judgment debtor, and that by virtue of their executions the appellants had a legal lien thereon, which was prior and superior to any lien of the plaintiffs by attachment, judgment, or execu

tion. We know of no principle upon which it can be properly held that the plaintiffs' judgments setting aside the judgments of the banks in any way interfered with the priority of the appellants' liens. While, if the property had been intangible assets of the debtor, the rule would have been as claimed by the plaintiffs, yet, where a creditor obtains a lien by virtue of his execution upon the tangible personal property of his debtor, it is not destroyed or subordinated to that of a subsequent execution or attachment. creditor who procures the former judgments or transfers to be set aside. When the banks' judgments were declared invalid, the property or its proceeds was in the hands of the sheriff subject to the liens of the execution creditors, and their priority was controlled by the time when their executions were delivered to the officer. The appellants' liens being prior and superior to the plaintiffs', they still retained their priority, although the judgments of the banks were set aside. The principle is well established that where tangible personal property has been levied upon by execution prior to the commencement of an action or proceeding in the nature of a creditors' bill to set aside transfers or judgments, the property is to be regarded as that of a judgment debtor; and, where there was a prior valid levy or lien, it is superior to any subsequent lien of the creditor who instituted such action or proceeding. A creditor is entitled to the preference acquired in the ordinary course of legal procedure, notwithstanding the insolvency of the corporation. Becker v. Torrance, 31 N. Y. 631; Innes v. Lansing, 7 Paige, 583; Van Alstyne v. Cook, 25 N. Y. 489; Davenport v. Kelly, 42 N. Y. 199. See, also, Maass v. Falk, 146 N. Y. 34, 40 N. E. 504; Bank v. Seligman, 138 N. Y. 435, 34 N. E. 196; Abegg v. Bishop, 142 N. Y. 286, 36 N. E. 1058. Therefore it follows that the judgment of the trial court, so far as it directed the payment of the plaintiffs' claim out of the proceeds in the hands of the sheriff in preference to the lien of the Campbell and Rowe executions, was erroneous, and in this respect should be reversed.

We think there is no force in the respondents' contention that the judgments of the banks were set aside only as to the plaintiffs, and therefore they obtained a right superior to that of the other execution creditors. As we have already seen, the plaintiffs have secured no advantage by reason of their action over the other judgment and execution creditors, but were relegated to their lien by virtue of their attachment or execution on their judgments. The judgments of the banks were set aside because they were held to have been suffered in contravention of the provisions of section 48. If they were invalid for that cause, they were invalid as to all the creditors of the corporation, and when set aside the liens of the other execution creditors attached and existed according to their legal priority.

But it is claimed by the respondents that the executions issued upon the Campbell judgments were returned nulla bona, and that he thereby lost the lien under his judgments and executions. There is, however, no evidence in the record that they were thus returned. It is true it shows that the executions upon the Campbell judgments and returns thereon were marked for identification, but not received in evidence. To obviate that difficulty, the respondents offered the executions, with the returns thereon, upon the argument, and asked that they be considered in determining this case. When these executions are examined, we find that the return of the sheriff is erased, so that the executions as offered contain no return whatsoever. Under the circumstances, we think they should not be received. Yet, if received, they would not justify this court in holding that they were returned unsatisfied. This is rendered more obvious when we find that the returns upon the executions were made through a mistake of a deputy sheriff, and that subsequently an application was made to set them aside, which was granted by the court, and the returns were set asidenunc pro tunc as of the date when made. That the court possessed the power to grant such an order seems to be established by the decisions of this court. Barker v. Binninger, 14 N. Y. 270; People v. Ames, 35 N. Y. 484; James v. Gurley, 48 N. Y. 163. Therefore the executions upon the Campbell judg ments are valid, and under them he obtained a lien upon the money in the sheriff's hands which was superior to that of the plaintiffs.

It follows that the judgment of the appellate division should be reversed, and that of the special term modified by striking out the provision that the plaintiffs' judgment should be paid out of the fund in the sheriff's hands, and by providing in lieu thereof that the money obtained upon the sheriff's sale be applied upon and in payment of the executions in his hands, other than those of the banks, in the order in which they were delivered to him, and as so modified that the judgment of the special term should be affirmed, with costs to the appellants in all

the courts.

PARKER, C. J., and O'BRIEN, BARTLETT, HAIGHT, VANN, and LANDON, JJ.,

concur.

Judgment reversed, etc.

(62 Ohio St. 621) HIGGINS v. BOARD OF COM'RS OF LOGAN COUNTY.

(Supreme Court of Ohio. May 8, 1900.) COUNTY COMMISSIONERS-COMPENSATIONPERSONAL EXPENSES.

1. The statute governing the compensation and allowances to a county commissioner (see section 897, Rev. St.) does not authorize the payment of personal expenses while attending