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Colorado court. The Colorado action out of ty in question enforced or protected, have a which arose the case of Pennoyer v. Neff was right to be heard in the courts of the state, not specifically directed toward the res, nor and the utmost that can be demanded on was any effort made to notify the defendant, the part of nonresident defendants is that the nonresident owner of the res, that any they shall be fairly notified of the action such res existed, or that the action had any so as to have an ample opportunity to aprelation to it. The course of procedure pre- pear and be heard therein. When these conscribed by the Colorado statute and pursued ditions exist, the rights of all parties interin the case above mentioned, in respect of the ested in the res are determined by due promatters now under consideration, is anal
cess of law. ogous to a foreclosure suit brought in New
Formerly, when a decree in equity for the Jersey against an owner of the equity of re- specific performance of a contract to condemption residing in New York, in which the vey real estate was enforceable solely by the notice of the suit served or published mere compulsive power of the court, brought to ly states that an action in the Court of Chan- bear upon the defendant so as to constrain cery of New Jersey has been brought against bim to make a conveyance in accordance the nonresident defendant, without further with his contract and the decree of the Informing him that the object of the action, court, the action in which such a decree was as described in the bill of complaint, is to obtained was strictly an action in personam, foreclose a mortgage on land belonging to the Spurr v. Scoville, 3 Cush. (Mass.) 578. As defendant and situate in New Jersey. An stated by Mr. Justice Gray, in Hart v. Sanheir of the mortgagor residing in a foreign som, 110 U. 8. 151, 3 Sup. Ct. 586, 28 L. Ed. state may not have the slightest knowledge 101: “Upon a bill for the removal of a of the existence of the res of which he is cloud upon the title as upon a bill for the the owner or part owner.
specific performance of an agreement to The notice to nonresident defendants pre-convey the decree, unless otherwise expressscribed by our chancery act (Laws 1902, p. ly provided by statute, is clearly not a judg. 514, 88 12, 13) is plainly intended to be a ment in rem establishing a title in land, but notice which shall apprise the defendant, operates in personam only by restraining not only that he is sued, but also of the na- the defendant from asserting his claim, and ture of the suit, and such notice necessarily directing him to deliver up his deed to be involves a disclosure of the res toward canceled, or to execute a release to the plain. which the suit is directed. The statute (sec- tiff.” When, however, the state through its tion 13) makes it the duty of the Chancellor Legislature imparts a quality to the deto prescribe the exact form and scope of the cree in equity in the classes of cases above notice by rule of court, and in the discharge mentioned, so as to make such decree opof this duty the Chancellor has ordained erate directly upon the res so as to make that such notice sball state “the object of the decree establish the rights of the parties the suit and why the persons to whom it [i. litigant in respect of the res, irrespective of e., the notice] is addressed are made de any compulsory action by the parties themfendants." Rule 58. If the Colorado stat- selves, or any of them, the whole character ute above referred to had, consistently with of the action at once is changed, and wbat the Constitution of the state, prescribed an was under the former course of procedure action in which the plaintiff not only set an action strictly in personam, becomes an forth his money claim against the defendant, action quasi in rem. Arndt v. Griggs, 134 but also described property of the defendant U. S. 316, 10 Sup. Ct. 557, 33 L Ed. 918. situate in the state of Colorado and within In the present case the res is personal the jurisdiction of the court, and prayed, property. It does not follow that, because not only for the establishment of the money anciently an equity decree affecting real es. claim against the defendant, but the appli- tate operated only in personam, and did cation of the property described to the pay not proprio vigore transfer or establish timent of such claim, it seems to me that a tle. such decrees affecting personal property plain ivstance would be presented of an ac- within the jurisdiction of the court were tion quasi in rem. It is plain that no no- in the same way limited in their practical tice to the defendant of such an action quasi operation. Assuming that formerly in nei. in rem would be reasonable which did not ther case did the decree establish title, but distinctly disclose the res, and its relation only the right of the complainant to receive to the defendant and to the demand of the a title, the important distinction still remains plaintiff. The origin of the jurisdiction of that in the case of real estate title did not our courts in actions quasi in rem is to be pass upon delivery of possession, whereas found in the power of the sovereign state in the case of chattel property it did. Anto exercise control over all objects to which ciently the Court of Chancery would not give that power can be directly applied. The to a successful complainant, in a suit for state must control all property within its the specific performance of a contract to territorial limits. Parties interested in that convey real estate, a writ of assistance to property, and residing within the state, or put him in possession, because no legal title voluntarily coming into the state, in order would be thereby established. The same dit.
The argument to sustain the plea in this Chancery Act of 1874, possibly deeming that case seems to assume that a party complain. they were only expressing wbat had there, ant, who has obtained a final decree in this tofore been implied, consolidated, to a cercourt establishing his equitable title to tain extent, the two laws above mentioned, chattels in possession of a defendant hold- and left their unified and revised section aping legal title thereto, and who in pursuance plicable to real property only. Revision 1877, of such decree has actually obtained posses- p. 115, $ 63. The section as drafted in 1874 sion, has no legal title, and will have none is now found in section 45, Revised Chancery until the defendant has voluntarily, or under Act of 1902 (Laws 1902, p. 525). Conceding the compulsion of the court, executed a con- that the argument on bebalf of the complainveyance. The general principle I think is ant cannot be strengthened by any reference now recognized that a bare legal title to to the existing law defining the effect of a chattels ceases to exist when the holder of chancery decree directing a “conveyance, rea complete equitable title takes possession, lease or acquittance," nevertheless there are for the reason that such possession creates other provisions in the act of 1799, and an a legal title. Kronson v. Lipschitz, 68 N. J. early supplement thereto, which remain to Eq. 367, 60 Atl. 819 (1904). Such certainly day unrepealed, which I think greatly must be the effect of the union of a com- strengthen the force and effect of a chanplete equitable title and possession, when cery decree relating to personal property, the only right or duty in respect of the chat- and undertaking to establish title thereto tels remaining in the original holder of tbe when the situs of the property is within the legal title is to convey the same to the bold- jurisdiction of the court. er of the equitable title. Possession of a Section 46 provides that the “decree of chattel under a complete equitable title in the Court of Chancery shall
have such a case must make a complete legal | the force, operation and effect of a judgment title.
at law in the Supreme Court of this state." We are not, however, at the present day, This mandate is now found unchanged in In a case like this, confined to the considera- section 44, Revised Chancery Act 1902 (Laws tion of those principles of equity jurispru- 1902, p. 524). The dictum of Chief Justice dence and equity procedure and practice Hornblower in deciding the case of Van Buswhich were recognized a hundred years ago. kirk v. Mulock, 18 N. J. Law, 184 (1841), Mr. Paterson's famous Chancery Act of 1799 which would greatly limit the meaning and (Paterson's Laws, p. 428) contained a num- effect of this statutory proyision, may cerber of provisions which I think bear very tainly at the present day be disregarded; the directly upon the subject under discussion. decision itself having been overruled. BulSection 47 provided that a decree of the lock v. Bullock, 57 N. J. Law, 508, 31 Atl. Court of Chancery “for a conveyance, release, 1024 (Ct. of E. & A. 1895); Mutual Life Ins. or acquittance,” after the allotted time for Co. v. Newton, 50 N. J. Law, 571, 575, 14 Atl. compliance had passed, should be considered | 756 (1888). In the supplement to Mr. Pater"in all courts of law and equity to have the son's Chancery Act, passed Feb. 29, 1820 (P. same operation and effect, and be as avail. L. p. 99), it was provided that, when the comable as if the conveyance, release or acquit plainant obtained a decree, the Court of tance had been executed conformably to such Chancery should have power, among other decree.” Paterson's Laws, p. 433. There things, “to cause by injunction the possession seems to be nothing in this language, es of the effects and estate demanded by the pecially when considered in the light of the bill, and whereof the possession or a sale is section of the statute next to be cited, which decreed, to be delivered to the complainant, limits the conveyance, etc., to instruments or otherwise, according to such decree, and atfecting real estate only. This original as the nature of the case may require. Laws statute, apparently extending to all classes 1820, p. 705, 8 7. This language is repeated of property, came down through the Revision in our present chancery act. Laws 1902, p. of 1846 unaffected. Rev. St. 1847, p. 914, tit. 526, § 46. Whatever may have been the ex33, c. 1, § 56. In 1852, in a supplement to act doctrine prior to these statutes, it seems the. Chancery Act of 1799, a provision was to me that ever since these acts were passed a inserted making a decree of the Court of decree of the Court of Chancery of New Jersey Chancery for a conveyance, release, or ac. establishing a complete equitable title to perquittance “of lands or any interest therein" sonal property, coupled with actual posses. directly and immediately effective to pass sion by the equitable owner, constitutes a letitle, notwithstanding the disability of any gal title which must be recognized as such party to the suit whose estate was so trans- in courts of law as well as in courts of equiferred, "arising from infancy, lunacy, cover ty. It may be admitted that the complete ture or otherwise." Laws 1852, p. 257, § 6. equitable title referred to does not include Section 47, Paterson's Law, however, re- cases where the holder of the legal title has mained entirely unaffected by this new law, any interest, or has any duty as trustee, or which merely provided for a wider effect otherwise, to perform with respect to the of a decree in the case of real estate than property in question other than the duty to the effect of a decree relating to personal convey the same to the equitable owner. property. The revisers who drafted the The question now arises whether a decree of the Court of Chancery of New Jersey, es- of imprisonment, to execute a transfer, or tablishing a complete equitable title to per otherwise deliver the shares in dispute to the sonal property, can be enforced by the court complainant in conformity with the decree. in any other way than by compelling action, The New Jersey corporation would have on the part of the defendant, in the way of | been left free to act in relation to the disdelivering up possession, I shall not discuss puted shares of its stock as it might see fit. this question at length because it is no longer It is unnecessary to discuss the effect of the an open one in New Jersey while the two decree in a new suit brought by the comrecent decisions of this court above cited re- plainant against the custodian, the Guayamain in full force. A careful examination quil, etc., Ry. Co. The point to be observed of the ancient rules of equity applicable to is that a decree, in an action against the nonthe case, with the aid of the statutory provi- resident stockholder as sole defendant, could sions above set forth, in my opinion leaves not operate directly upon the res, and be no ground for the proposition that the Court made to control and dispose of the res, with. of Chancery of this state, having pronounced out regard to any action on the part of the a decree establishing title to personal prop- sole defendant which the decree might direct erty within its jurisdiction, and in the to be taken. custody of a party to the suit, can only give In supporting the proposition that the prespossession of the property to the party who ent suit is strictly a suit in personam the is entitled to it under the decree, by com- brief for the defendant alleges "that the obpulsive force exerted upon the custodian, ject of the suit is to obtain relief which could constraining him to deliver up possession. only be decreed in personam," and points out The court may appoint a receiver, and such that “the prayer is specifically limited to a receiver will have a right to possession, and decree directing the defendant to transfer may take possession, and the custodian, after the shares of stock in question,” and that being enjoined from preventing the receiver “the operation of the decree would be purely from taking possession, may be removed as against the person of the defendant.” In supan obstructive force and be placed in jail. port of these views it is alleged that “the But, without pursuing this subject further, case differs from those in which decrees are it may be pointed out that prior to the chan- sought to compel the conveyance of lands," cery act of 1799, the fundamental weakness in which cases by statute the “decree if not of a decree of the Court of Chancery, in complied with by the defendant can operate suits to obtain title to real estate, such as itself as a conveyance,” and it is insisted suits for specific performance of a contract that “no similar provision is made for the to convey real estate, did not arise out of transfer of property purely personal," such any essential incapacity of the court to obtain as the shares of stock in question. This arpossession of the res, or to give possession of gument seems to rest upon a mistaken view the res to the party entitled thereto under the of the nature of the case set forth in the decree. The fundamental weakness of the complainant's bill, and of the relief therein decree consisted in the fact that possession prayed for, as well as an inadequate view of of the res gave no legal title under the tech- the power of the Court of Chancery to ennical rules of law governing the transfer of force its decrees affecting personal property freehold estates in land. Possession, which which it can seize and control. The allegawas so potent for the transfer of title to per- tions of the bill show that the stock in liti. sonal property, has had no effect to transfer gation is charged with a trust for the coma freehold title to real estate since the days plainant's benefit, that the complainant is the of livery of seisin.
equitable owner of this stock, and that the It is undoubtedly true that an action strict- defendant, as executor, etc., has no estate or ly in personam may be brought in the Court interest therein, excepting so far as the same of Chancery of New Jersey, for the recovery stands as security for the sum of $10,000. of corporate stock, the situs of which is in The prayer of the bill is that the rights un. New Jersey. In the Guayaquil, etc., Ry. Co. der the trust above mentioned may be estal Case, if the complainant in the cross-bill had lished by the decree of the court, as well commenced an original suit against the resi- as that the defendant may be decreed to as. dent of the state of New York who claimed to sign and transfer the said shares of stock own the stock of the Guayaquill, etc., Ry. Co to the complainant upon payment of the said in dispute, without making the last-mentioned sum of $40,000, with the interest thereon. or coinpany a party to the suit, it seems to me course it must be conceded that in any acthat the action would have been strictly in tion to recover stock, if the relief prayed for personam. The decree in such case, even if includes the surrender of a certificate, or the the defendant had appeared in the suit, execution of an assignment or power of atwould have had no direct effect upon the pos- torney, such relief can only be obtained by session of the res, nor do I see that proceed- compelling the defendant to act, and if such ings upon the decree could have been conduct relief is the whole relief prayed for, the aced which would have had the effect to give tion, as we have seen, may be strictly in perthe successful complainant possession of the sonam. In the present case, while the bill
The decree could only have been en- prays that the defendant may be decreed to pute, the main relief prayed for is the estab-, with. The mere fact that the failure of some lishment of the complainant's equitable ti- party to the action to move for an injunctle. The jurisdiction of the court is sustain- tion, or for the appointment of a receiver, ed by the existence of a trust, a trust in re- may in fact result in the disappearance of spect of a res, situate within the jurisdiction the res pending the suit, and its absence of the court and in the custody of a party to from the state when the final decree passes, the suit. If the complainant shall obtain a cannot in my judgment affect the essential decree in this case establishing its rights in character of the action at the time when it respect of the res, and then shall desire to was commenced, if at that time the res was secure the surrender of the outstanding cer- within the state and within the control of tificates representing the res, it may be the court. The actual seizure of chattels obliged to bring a suit in the state of Penn- which constitute the res, and the custody sylvania in order to secure such surrender. thereof in a receiver appointed by the court, A similar situation would exist if the defend- cannot exclude the possibility that the res ant were a natural person resident in New may be removed from the jurisdiction of the Jersey who had been duly served with court while the action is pending. It is, process in New Jersey, but who had gone out however, unnecessary to consider several of the state, carrying with him the certific questions which are suggested in regard to cates representing the stock which was the the effect of the removal of the res prior to subject-matter of the litigation. In such a the final decree, in an action which was case, however, the decree would be enforcea- plainly, at the time of its institution, an acble in personam, whenever the defendant tion quasi in rem. In considering the escould be seized within the state of New sential nature of an action quasi in rem, Jersey.
both at the time of its institution and at the The last matter to be considered is wheth- time of the final decree, there is a plain diser it is necessary, where the res is personal tinction between the mere possibility that, property, to have the res actually placed pending the action, the res may be removed within the custody of the court, through the from the jurisdiction of the court and the acinstrumentality of a receiver, in order to tual remoral of the res. give to the action the quality of an action I think it follows from the principles enunquasi in rem. I can find no warrant in rea-ciated in a number of recent federal cases, son, and none in the authorities, disregarding and in the New Jersey cases above cited, that a few dicta, which make the actual seizure an action like the present one, brought by the of the res by an officer of the court essen- complainant to establish a trust in shares of tial to the status of the action as one quasi stock in a New Jersey corporation, is an in rem. The fundamental essential, of course, action quasi in rem, provided the corporation, must be that the personal property which is the stock of which is in litigation, is made a the res is so situated within the state that party to the suit, and is lawfully subjected it may be seized. In other words, the res to the jurisdiction of the court in which the must be within the control of the state. If suit is brought by service of process within the state provides for an action affecting the the state, or by voluntary appearance. Arndt res, but the court in which the action is v. Griggs, supra; Jellenik v. Huron Copper brought has no power to directly control the Mining Co., 177 U. S. 1, 20 Sup. Ct. 559, 44 res, and can only control the res by com- L. Ed. 647; Roller v. Holly, 176 U. S. 398, 20 pulsory action on the part of the defendant, Sup. Ct. 410, 44 L. Ed. 520; Citizens' Savthen we have an instance where the state ings & Trust Co. v. Illinois Central Railway has full power to provide for an action quasi Co., 205 U. S. 46, 27 Sup. Ct. 425, 51 L. Ed in rem, but has seen fit not to do so—has 703. All parties, whether resident in New seen fit to provide only an action strictly in Jersey or residing in other states, may be personam. It is not the actual seizure of the lawfully brought into the suit by serving prores which is the essential element of an ac- cess upon the New Jersey residents, and givtion quasi in rem, but the power to seize the ing the reasonable notice provided by law to res, and to seize it in the action. If the res the defendants residing in other states. I is within the jurisdiction of the court, it discover no basis for the proposition that the may be entirely unnecessary to take posses- whole fabric of the action quasi in rem falls sion of it through a receiver in order to se to the ground unless the Court of Chancery cure its presence when the decree of the through a receiver attempts in some way to court is to be enforced. An injunction re- take possession of the res, and actually obstraining the custodian of the res, who is a tains such possession. party defendant, may be amply sufficient to The question remains whether, when the secure the desired result. Neither a receiver custodian of the res, the New Jersey cornor an injunction may be necessary to pre- poration whose stock constitutes the res, serve the res within the control of the court. comes into court as a party complainant, the So long as the res is situate within the ju- case is essentially different from that which risdiction of the court, and the custodian of is presented where the custodian is made a the res is made a party to the suit, the re- party defendant. In each case the res is subquirement of an action quasi in rem under jected to the power of the court; in the one court acquires when the custodian of the res, decree had been passed, the court would have is brought into court by service of process, no power, by process of contempt or otherand in the other by the voluntary action of wise, to enforce the decree so far as such the complainant in coming into court and decree might undertake to constrain the depresenting to the court for adjudication his fendant to deliver certificates of stock, exclaims in respect of the res. No doubt the ecute assignments or powers of attorney, or court at the instance of the defendant may pursue any other course of conduct relating preserve the res to meet the decree of the to the res which the decree might undertake court by an injunction or by a receiver. If, to prescribe. however, in cases like the Guayaquil, etc., An order will be advised overruling the Railway Company Case and the Singer Mfg. plea. Company Case, a prayer for a receiver, or the appointment of a receiver, or the actual
(74 N. J. E. 812) placing of the res in the custody of a receiver,
PARKER v. TRAVERS et al. is necessary to give the action the status of an action quasi in rem, I do not think that (Court of Errors and Appeals of New Jersey.
Nov. 16, 1908.) it would necessarily follow that such receivership proceedings would be necessary to con
1. WILLS (8 616*) — CONSTRUCTION - ESTATES
CREATED-LIFE ESTATE-POWER OF DISPOSIstitute the present action one quasi in rem. TION. If the decree in this case is in favor of the When to a life estate, with remainder over complainant, no action on the part of any of what may be undisposed of, the will adds a receiver is necessary. The situation of the est of the life tenant is not thereby enlarged,
power of disposition, the property right of interres is not disturbed. The complainant stands but the devisee takes the life estate only with with its equitable rights to the res estaba power of disposal, to be exercised by her dur. lished by the decree, and it remains in pos- ing the continuance of the life estate, and for session of such res. If, on the other hand,
[Ed. Note.-For other cases, see Wills, Cent. the decree is in favor of the defendant, no Dig. 88 1418_1430; Dec. Dig. $ 616.*] action on the part of any receiver can do the 2. Wills (8 740*)—RIGHTS OF DEVISEES-CONdefendant any good. Presumably the defend. VEYANCES BETWEEN DEVISEES-EFFECT. ant holds some certificates which have al. Testator devised and bequeathed all his ready been issued representing the stock in property, not disposed of to his widow, with
power of disposition, the remainder as to all dispute. The decree will merely adjudge property not disposed of by the widow to testhe complainant's claim void and establish tator's daughter in case she survived the widow, the title of the defendant. Assuming that and in the event of the widow marrying again
she should have only one-third of the property there are certificates representing the res in remaining, the balance to be invested for, and possession of the defendant in the state of to be paid to, the daughter on her attaining maPennsylvania, it is somewhat difficult to see jority. The widow conveyed all the real estate precisely what a receiver could take into his devised by the will to B., to whom she was aft
erwards married, and he, immediately after the possession. In the Singer Company Case the conveyance, conveyed to his son, who reconvey. stock in litigation was stock of a New Jersey ed to the widow. Held that, on the widow's recorporation, which was made a party to the marriage, the daughter acquired an absolute essuit, and was practically the custodian of widow's subsequent deed to the daughter was
tate in two-thirds of the land, and that the the res. This corporation was enjoined from only effective to transfer an undivided onetransferring the stock, and receivers were third thereof. appointed according to the report, “to whose
[Ed. Note.-For other cases, see Wills, Dec. charge and custody” the court "committed Dig. § 740.*] the shares in question.” What was actually 3. BANKRUPTCY (186*)--FRAUDULENT Condone by the receivers in the way of getting
VEYANCES BY BANKRUPT-ACTION BY BANK
BUPT'S TRUSTEE-ESTOPPEL. possession of stock in a corporation, the cer- Where a suit by a bankrupt's trustee to set tificates of which had been lawfully issued, aside a conveyance by the bankrupt to her and were in the possession of a party yond
daughter was based entirely on the charge that the jurisdiction of the court, does not appear. who was the only real creditor in the bankrupt.
the conveyance was to hinder and delay E., My conclusion is that the present action cy proceedings, E., having accepted from dehas all the essential characteristics of an ac- fendant the balance due on a loan for which she tion quasi in rem, and that the defendant, held the title to the land, and having thereupon
conveyed the land to defendant, was essopped having been duly notified of the suit so as to to claim that a conveyance of the bankrupt's algive it an ample opportunity to appear and leged interest in the land to defendant was make defense therein, will, if it refrains from fraudulent as to her. appearing, be bound by the decree so far as
[Ed. Note.-For other cases, see Bankruptcy,
Dec. Dig. 8 186.*] the same relates to the status of the res, and that in such case the defendant cannot main-4. BANKRUPTCY ($177*)—FRAUDULENT Con.
VEYANCES-VALIDITY. tain that it is deprived of property without Where a bankrupt owned the equitable title due process of law. This conclusion is not to certain land, subject to an indebtedness, affected by the admission that, if the defend- which she paid, and then induced the creditor ant were a natural person, and should come
to convey the property to defendant, her daugh
ter, within four months prior to the filing of within the jurisdiction of the court after the the bankruptcy petition, such conveyance was,