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1895, he received from the executor of the will the sum of $200, being for a specific legacy to said Jan Simek, and $700, being for a specific legacy to said Margarita Simek; that upon the final accounting it was found that each of said legatees was entitled to a further legacy of $393.27, owing to the fact that other legacies had lapsed, and on the 16th day of December, 1895, he received from the executor the amount of these legacies also, making the total amount received by him, as attorney for said legatees, the sum of $1,686.54. The respondent claims to have remitted to his clients the sum of $150 in money, in a registered letter duly addressed to them, and mailed on the 29th day of May, 1897, and the further sum of $700 in seven $100 United States treasury notes, inclosed in a registered letter, and mailed on the 4th day of August, 1897, addressed "Mr. Jan Simek and Margarita Simek, No. 2 Nova Ves, by Nova Kdyne, Bohemia." He attempts to explain this unusual method of transmitting money to a foreign country, where it would not pass, but would have to be sold at a discount, on the ground that he did it at the express request of his clients. The letter which he claimed before the grievance committee of the association of the bar as his authority for this course merely requested him to send it by registered letter, but on the hearing before the referee he claimed to have subsequently received a letter specifically directing him to send it in American or Austrian money. This letter, however, he was unable to produce, and asserts that it was stolen. It satisfactorily appears by the evidence that neither remittance was made, and that the respondent has appropriated to his own use the entire amount collected for his clients. He claims to have registered both letters. At first he claimed to have registered the letter with which he inclosed. the $150 at the main post office, and then, when it was shown that there was no record of it, he asserted that he registered it at a substation up town. It appeared that the records at the substation had been destroyed. He produced a post office mailing receipt for a registered letter to his clients, which he testified was the receipt for this letter; but the date, excepting the year 1897, had been destroyed as he claims by fire by his placing a lighted cigarette upon the page of his letter book to which it was attached. He did not receive from his clients through the post office department the usual receipt for this letter, nor did he receive from them any acknowledgment thereof, or write them concerning it, until the time he claims to have inclosed the $700. The registered letter with which he claims to have inclosed the seven $100 bills was duly received by the clients of the respondent, but when it was opened the evidence shows that instead of bills it contained 14 sheets of tissue paper. The respondent, in letters to his clients after he had received the money, clearly conveyed the impression to them that it had not yet been collected. He did not deposit it in a separate account, but mingled it with his own funds, and the account in which it was deposited did not remain good for the amount. He does not satisfactorily show from what source he obtained the $150 he claims to have remitted. He claims that it was part of $200, constituting his share of $100, a cash collection received for professional services by his law firm, but his partner says that it was not customary to thus divide the amounts received by the firm. He did check out $700 from

44

and 134 New York State Reporter

(Sup. Ct.

a bank account on the day he claims to have mailed the $700, but three days later he opened an account in another bank, depositing $700 therein, and his explanation as to the source from which he obtained the $700 with which he opened the new account is neither satisfactory nor corroborated. Aside, therefore, from the exorbitant charges by which he concedes that he appropriated for his services $836.64, for which he does not satisfactorily show the consent of his clients or any warrant, we are convinced by the evidence that he made no remittance to his clients, and appropriated the entire amount collected to his own use. By this deception, fraud, and dishonesty he has forfeited his right to remain a member of an honorable profession, and the entry of an order disbarring him and striking his name from the rolls is directed.

(114 App. Div. 374.)

PEOPLE v. FEDERAL BANK OF NEW YORK.

APPEAL OF SCHLESINGER.

(Supreme Court, Appellate Division, First Department. July 12, 1906.) RECEIVERS STIPULATION FOR COMPENSATION.

The people, represented by the Attorney General, and the receiver and his attorney being the only parties to a reference for the purpose of fixing the compensation of the receiver and his attorneys in a proceeding by the people against an insolvent bank, the special term cannot reduce the amount stipulated by the parties for such compensation.

Appeal from Special Term, New York County.

Proceedings by the people against the Federal Bank of New York. From an order of the special term modifying the report of a referee, Leo Schlesinger, receiver, and Kneeland, La Fetra, and Glase, attorneys for said receiver, appeal. Reversed.

Argued before O'BRIEN, P. J., and MCLAUGHLIN, PATTERSON, LAUGHLIN, and HOUGHTON, JJ.

D. Cady Herrick, for appellants.
Charles F. Bostwick, for respondent.

PER CURIAM. It would seem from the course of the trial before the referee that it was practically stipulated that the claimant's compensation should be fixed at $20,000. The people, represented by the Attorney General, and the claimants were the only parties to the reference. Any stipulation they may have made the Special Term could not disturb while it remained in force. This being so, the action of the Special Term in reducing that amount to $15,000 was unwarranted. The order appealed from should be reversed, and the report of the referee confirmed, without costs.

(114 App. Div. 462.)

GRANT v. HUMBERT.

(Supreme Court, Appellate Division, First Department. July 12, 1906.) 1. INSANE PERSONS-ACTION-LEAVE TO SUE-ORDER-EFFECT.

An order permitting service of summons on an inmate of a state insane hospital, for whom no committee has been appointed, is not an order granting leave to bring an action against him.

2. SAME NECESSITY TO OBTAIN LEAVE TO SUE.

An action may be maintained without leave of court against an inmate of an insane hospital for whom no committee has been appointed.

[Ed. Note. For cases in point, see vol. 27, Cent. Dig. Insane Persons, § 157.]

3. SAME.

A creditor of an Incompetent, for whom a committee has been appointed, on seeking to enforce his claim, must petition the court for the allowance and payment thereof, or, in the alternative, for leave to sue thereon the court, which by its committee has taken possession of the property of the incompetent, being clothed with authority to pay claims. [Ed. Note. For cases in point, see vol. 27, Cent. Dig. Insane Persons, § 157.]

4. SAME CLAIMS-PRIORITY.

Where the estate of an incompetent is insufficient to pay the claims, the court must apply the property in payment thereof pro rata, without preference, excepting where, prior to the adjudication of incompetency and the appointment of the committee, a creditor has in good faith obtained a lien.

5. SAME.

A creditor of an incompetent brought an action at law against him. Thereafter the incompetent was adjudged incompetent, and a committee appointed. Held, that the creditor acquired no priority in the payment of his claim.

& ACTION-STAY OF ACTION AGAINST INCOMPETENT.

A creditor brought an action at law against an incompetent. Subsequently the court appointed a committee for the incompetent. Held, that the action need not necessarily be stayed until the discharge of the committee, but might properly be prosecuted to judgment, to enable the creditor to have his claim liquidated before applying to the court to have it paid by the committee.

7. INSANE PERSON-ACTION AGAINST ENFORCEMENT OF Judgment.

A judgment recovered in an action against an incompetent, brought prior to the appointment of a committee, can only be enforced by application to the court.

8. SAME-LEAVE TO PROSECUTE ACTION-WAIVER.

An incompetent was sued by a creditor prior to the appointment of a committee. The committee appeared and answered for the incompetent, and the cause was placed on the calendar. Held, that the committee did not waive the failure of the creditor to obtain leave to prosecute the action.

9. LIMITATION OF ACTIONS-STAY OF PROCEEDINGS-EFFECT.

A creditor of an incompetent properly brought suit against him prior to the appointment of a committee. The committee applied for a stay of the prosecution of the action a few days within the expiration of the statute of limitations. Held, that an order granting a stay did not affect limitations; the creditor, on his claim not being paid in full, being at liberty, after the discharge of the committee, to continue the action for any unpaid balance.

10. ACTION-STAY OF PROCEEDINGS.

A creditor of an incompetent commenced an action against him prior to the appointment of a committee. The committee subsequently appointed appeared and answered. Thereafter the committee filed a petition for leave to be made a party to the action. The request was withdrawn before consent was granted, and a motion for a stay of the prosecution of the action was then made. Held, that the court should have denied the motion, and should have granted leave to continue the action to judgment.

Appeal from Special Term, New York County.

Action by Madison Grant against Arthur C. Humbert. From an or

and 134 New York State Reporter

der enjoining the prosecution of the action, plaintiff appeals. Reversed, and leave granted plaintiff to prosecute the action.

Argued before O'BRIEN, P. J., and MCLAUGHLIN, PATTERSON, LAUGHLIN, and CLARKE, JJ.

William W. Niles, for appellant.
Manfred W. Ehrich, for respondent.

LAUGHLIN, J. The action is brought on a promissory note for $1,500, due on the 24th day of March, 1900, alleged to have been made by the defendant payable to the order of the plaintiff. At the time of the commencement of the action the defendant was an inmate of Bloomingdale Asylum, but no committee of his person or property had been appointed. Before commencing the action an application was made in behalf of the plaintiff to one of the justices of the Supreme. Court, evidently with a view to complying with the regulation of the state lunacy commission precluding service on an inmate of a state hospital for the insane without an order of a judge of a court of record for leave to serve the defendant. Leave was granted, and service was made upon the 25th day of November, 1905. On the 8th day of Decemter thereafter, by an order of the Supreme Court, the defendant was duly adjudged incompetent, and Susan Humbert was duly appointed committee of his person and property. She qualified, and a commission was duly issued to her on the 12th day of December. On the 13th day of December Messrs. Bowers & Sands, attorneys, served a formal notice of appearance, stating that the defendant, "an incompetent person, by Susan Humbert, committee of his person and property," appeared in the action, and thereafter the defendant, by his committee, served an answer setting forth that he had been judicially declared incompetent, and the appointment of the committee, and putting in issue all of the allegations of the complaint, and setting up as a separate defense that the note was made without consideration. Before appearing the committee verified a petition for leave to be made a party to the action, and requested the attorneys for the plaintiff to stipulate that an order to that effect might be entered; but the request was withdrawn before the consent was granted, and the motion for a stay of the prosecution of the action was thereupon made.

If leave of the court to bring the action was necessary, I think the order permitting service of the summons cannot be construed as such leave. It was not so intended, and it was not made by the court.

The theory urged by the respondent to sustain the order is that the action cannot be maintained without leave of the court. That contention is not sustained by the authorities. Incompetency neither suspends the running of the statute of limitations on claims against the incompetent (Sanford v. Sanford, 62 N. Y. 553), nor does it deprive the court of jurisdiction, or bar a claimant from instituting an action or proceeding against an incompetent person, and prosecuting the same to judgment and enforcing satisfaction thereof by execution. Crippen v. Culver, 13 Barb. 424; Sternbergh v. Schoolcraft, 2 Barb. 153; Clarke v. Dunham, 4 Denio, 262; Robertson v. Lain, 19 Wend. 649; Matter of Heller, 3 Paige, 199; In re Hopper, 5 Paige, 489; Noe v. Gibson, 7

Paige, 513; Prentiss v. Cornell, 31 Hun, 167, affirmed 96 N. Y. 665; Williams v. Empire Woolen Co., 7 App. Div. 345, 39 N. Y. Supp. 941; L'Amoureux v. Crosby, 2 Paige, 422, 22 Am. Dec. 655; Carter v. Burrall, 80 App. Div. 395, 81 N. Y. Supp. 30. If the action had not been commenced until after the inquisition and the appointment of the committee, the service of the summons upon the defendant or his committee without leave of the court might have been set aside by the court (Smith v. Keteltas, 27 App. Div. 279, 50 N. Y. Supp. 471), or the prosecution of the action enjoined (Matter of Delahunty, 28 Abb. N. C. 245, 18 N. Y. Supp. 395); and the plaintiff would also be subject to punishment for contempt, because, although the title to the property remains in the lunatic, the court, by the committee, takes unto itself the custody, care and management of the property for the pur pose of preserving it from waste or destruction, and providing for the payment of his debts, and of the maintenance of him self and family and the education of his children, and it will brook no interference with the property or with the committee, who is its officer or bailiff. Matter of Hopper, 5 Paige, 489; Soverrhill v. Dickson, 5 How. Prac. 109; Code Civ. Proc. § 2321; Matter of Application of Otis et al., 101 N. Y. 580, 5 N. E. 571; Kent v. West, 16 App. Div. 496, 44 N. Y. Supp. 901; affirmed 154 N. Y. 749, 49 N. E. 1099; People ex rel. Smith v. Com'r of Taxes and Assessments, 100 N. Y. 215, 3 N. E. 85; Pharis v. Gere, 110 N. Y. 336, 18 N. E. 135, 1 L. R. A. 270; Carter v. Beckwith, 128 N. Y. 312, 28 N. E. 582; Crippen v. Culver, supra. The court, which by its committee takes possession of the property of the incompetent person, is clothed with full authority to pay all just claims against the incompetent to the extent of his estate, and to determine the validity of claims by reference if the facts are disputed. This summary remedy is favored by the courts, and is adopted in all cases unless some special facts or circumstances exist which render it necessary or appropriate that the claimant should be permitted by the court to maintain an action for the purpose of having his claim or the extent thereof adjudged. Kent v. West, 33 App. Div. 112, 53 N. Y. Supp. 244; Williams v. Estate of Cameron, 26 Barb. 172; Matter of Heller, supra; Matter of Hopper, 5 Paige, 489; Niblo v. Harrison, et al., 9 Bosw. 668.

The established practice with respect to the enforcement of claims against an incompetent person for whom a committee has been appointed is to present a petition to the court, praying that the claim be allowed and paid, or, in the alternative, that leave be granted to sue thereon. Matter of Hopper, supra; L'Amoureux v. Crosby, supra; Williams v. Estate of Cameron, supra; Matter of Delahunty, supra; Matter of Wing, 83 Hun, 284, 31 N. Y. Supp. 941.

Where the estate of an incompetent is insufficient to pay the claims in full, the court applies his property in payment thereof pro rata, without preference, excepting where, prior to the adjudication of incompetency and appointment of the committee, the creditor has in good. faith obtained a lien or acquired a right of property by contract or otherwise, as in Carter v. Burrall, supra, where a warrant of attachment had been duly issued and levied, and in Matter of Hopper, supra, where a judgment had been recovered and an execution issued and levied,

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