execution, which was returned unsatisfied.

Plaintiff now sues defendant, who is a stockholder in said company to an amount greater than the plaintiff's claim, under Sec. 32, 2 R. S. p. 660, (6th edition), on the ground that the capital stock had not all been paid in.

It appeared that the capital stock was issued upon certain terms to one of the corporators, in payment for certain patent rights, which were taken out by the corporators for that purpose; and that

Had they exercised an honest judg ment and a fair discretion in reference to them, the stockholders would not have been liable.

But this they failed to do; and such omission was important and fatal to the defen ants.

Judgment affirmed.

Opinion by Brady, J.; Davis, P. J. and Daniels, J.,concurring.

EVIDENCE.

no part of the capital-stick was paid in N. Y. SUPREME COURT. GENERAL TERM

FIRST DEPARTMENT.

Geo. W. Southwick, applt. v. Benj. F. Mudgett, respt.

Decided May 1, 1876.

When money is sued for as a loan, for which a receipt had been given, it is competent to show that it was not a loan, but a deposit for a specific pur

pose.

In action on a note it is competent to show a want of consideration. Appeal from judgment entered on report of referee.

Plaintiff claims to have loaned defendant $3,000, and brings this action to recover the same.

Held, That under the provisions of the act of 1853, chap. 333, the trustees may purchase property necessary for the business of the company, and issue stock to the amount of the value thereof. They are not authorized to do Defendant denies the loan, and al more, and the property therefore rep- leges that the money had been given resents the capital stock only to the ex-him by plaintiff, to be invested in a certent of its value. tain sewing machine company, on the The defendant failed to show, either understanding that if the company that the patents were valued at should dissolve, and not reorganize, deany sum, when the company was form fendant should pay back the $3,000, ed, or what was their actual value at otherwise it was to be invested in the that time. The value of a patent is company's stock. much a matter of conjecture, until the process to which it relates has been tried. But experiments had been made with the patents in question, and some information gained from the results, which would have enabled the corporators to have formed an estimate of their value.

That the company was afterwards reorganized and the money invested in its stock, and also set up a counterclaim for professional services for $3,200.

The issues were referred to Henry Nicholl, Esq., to hear and determine

Plaintiff put in evidenc the receip given by defendant on receiving the

money:

"NEW YORK, April 25, 1867. "Received of G. W. Southwick,

CONSTRUCTION OF WILL.

N. Y. COURT OF APPEALS. Gourley, admr. &c., respt. v. Campell et al., applts.

Decided May 23, 1876.

Esq., three thousand dollars, to be paid The provisions of a will which pro

on demand, with interest.

"B. F. MUDGETT."

And objected to defendant's giving any parol testimony tending to show any such understanding, as claimed by defendant, or to his showing that the money was not given as an absolute loan: on the ground that the terms of the writ ten instrument could not be varied by parol evidence.

The evidence throughout was conflicting.

The referee found that the complain: should be dismissed and $1,000 counter claim allowed defendant.

W. A. Arnoux, for applt.
Jno. II. Hand, for respt.
On appeal.

Held, That it would be a sufficient answer to plaintiff's objections to defendant's testimony, that the action was for a loan, an not on a written instrument.

It was certainly competent for defendant to show that the sum given was not a loan, but a deposit, for a purpose in plaintiff's interest, and to which it had been applied.

But assuming that the paper was a promissory note, it was equally compe tent, for the defendant to show a want of consideration, and this he did, for he showed that the money paid him, was employed for plaintiff's benetit, and in the manner directed by him.

The counter claim was allowed on conflicting testimony, and we cannot say that the referee was not justified in his findings in this respect.

Ju gment affirmed.

vides that the executors shall place the proceeds of collection of debts due testator and all his property real and personal at interest on bond and mortgage or otherwise, as in their judgment they may deem best, and that the proceeds, rent, income, or interest should be used for the support of testator's wife and children, and devising and bequeathing all his property to the children on the death of the wife, are too indefinite to anthorize a conclusion that the execu tors were bound to sell the real estate in event.

any

The personal property being sufficient to support and educate the children and maintain the widow, the land retained its original character and descended to the heirs.

This action was brought for a construction of the will of one II. and for the appointment of a trustee to carry

out an unexecuted trust under it.

The will, a ter providing for the col lection of all sums due testator and the settlement of his business and the pay ment of his debts, contained these words:

My executors shall place the proceeds thereof and all my property, both real and personal, at interest on bond and mortgage or otherwise as in their judgment they may deem best."

This was followed by a direction that the proceeds and rent, income, or interest shall be employed and used for the support and maintenance "of my beloved wife, Elizabeth, and for my children, and their education." By the

Opinion by Brady, J.; Davis P. J. concluding portion of the will the tes and Daniels, J., concurring.

tator devised and bequeathed to his

children, by name, all his "estate both Also held, That the costs being in real and personal of all kinds whatso- the discretion of the court, and the ever, to be divided equally among them questions involved being difficult and on the death of the mother." intricate, they should be paid out of the property.

This action was brought to obtain relief against a judgment entered by default in an action brought by defendAlso held, That there being no ne-ant to foreclose a mortgage. The mortcessity for a sale of the real estate the gaged premises were owned by the land retained its original character and uncle of plaintiffs and had a frontage descended to the heirs. 2 Ves. Jr., 271; of 180 feet on 7th street, Troy, and 4 Edw. Ch. 613; 6 J. R. 73; 3 Cow. were mortga ed by him to defendant. 651; 5 Paige, 447; 2 Bro. Ch. Cas. for $10,000, in 1856. In January, 1860, the mortgagor died, leaving a

Martin I. Townsend, for applt.
S. W. Jackson, for respts.

a

will, of which his wife was exccutrix, between defendant and the executrix. wherein he devised to his widow a life No report of sale was ever filed or conestate in 128 feet front, with remainder firmed. Defendant entered into posin fee in 9-20ths thereof to plaintiffs. session under the purchase and has All his real estate not disposed of by realized about $19,500, of which about the will, including the remainder of the $15,500 were the proceeds of the 128 mortgaged premises, and his personal feet. The ex cutrix, in consideration estate not disposed of he ordered his of the arrangement under which the executrix to sell and convert into judgment was obtained, received from money, and with the proceeds pay and defendant a lease for her life at a nomdischarge his debts, including the inal rent of one of the houses on the mortgages and incumbrances upon the 128 feet. Plaintiff's claimed that the 7th street property devised as before judgment was void on account of fraud mentioned. In May, 1860, defendant, and because no guardian ad litem was who was cognizant of these facts, com- appointed for them. menced an action to foreclose his mortgage. The executrix answered, setting up as defences usury, payment and a Held, That the executrix stood in a counter claim. The plaintiffs herein, relation of trust towards plaintiff's as who were infants at that time, were far as the execution of the powers of made defendants, but no guardian ad sale of the 52 feet was concerned, and litem was appointed for them. After it was her duty to obtain as nearly the action had progressed some months as possible the full value on an arrangement was made between the sale thereof, and apply it in reduction defendant herein and the executrix, of the mortgage, and she had no right whereby, under the power of sale in the to convey for a nominal consideration, will, instead of selling the 52 feet for and under the circumstances the decree their full value, which the referee found of foreclosure as between plaintiffs and to have been $5,950, and applying the the defendant was ineffectual to bar the proceeds to the reduction of the mort equity of redemption of the plaintiffs, gage, she conveyed them to defendant and they were entitled to have it avoidfor the nominal price of $500, and ed, and could maintain an original withdrew her answer in the foreclosure action in equity for that purpose. suit and stipulated that judgment N. J., 9. That although the judgment might be taken therein for the full might not be void so as to impair the amount of the mortgage with interest title of bona fide purchasers from deand costs, without crediting anything fendant, yet as between him and plainfor the 52 feet conveyed. Judgment tiffs he had no equity which should of foreclosure and sale was entered and entitle him to retain the fruits of the defendant bid in the premises for proceeding or to prevent them from $14,000, which the referee found was avoiding it. That when defend : much less than their value. There was entered under his purchase he became a surplus of $2,000, which was never merely mortgagee in possession, and brought into court and of which plain- was bound to account to plaintiffs for tiffs have received no part, but which their share of what he realized over was disposed of under an arrangement and above the mortgage debt.

8

Also held, That th judgment entered By force of this act the provisions of without having a guardian ad litem the Code respecting attachments with appointed for the infant defendants, all the concomitants and incidents though voidable, was not absolutely affecting snch proceedings are made void. 1 Hill, 130, 143; 18 Vt., 290; * Metc., 196; 3 Dev. (N. C.), 241; 17 N. Y., 218; 7 Robt., 147, 546.

applicable to the Marine Court and remain unaltered and unaffected by the act of 1875, which makes no change in the attachment law applicable to the Marine Court.

It is apparent that no change was intended, and none follows by implica tion. The justification of the sureties

TAKING TO DISCHARGE AT. on the undertaking to discharge the