NOTE.-Section 2530. In actions for relief on the ground of fraud or mistake, and in actions for trespass to property, the cause of action shall not be deemed to have accrued until the fraud, mistake or trespass complained of shall have been discovered by the party aggrieved. Code of Iowa, 1873, Sub. 4, of Sec. 2529, above referred to, is identical with Sub. 3, of Sec. 2740, of the Code of 1860. The amendment consists in the omission of the words "as above contemplated," from Sec. 2530, thereby seeming to make the section applicable generally to all actions for relief on the ground of fraud. We are inclined to agree with the Supreme Court of Iowa, that the amendment is not a material one. As the term is usual in law, ""relief on the ground of fraud" is confined solely to courts exercising chancery jurisdiction.

PROMISSORY NOTES-EFFECT OF A SUBSEQUENT INDORSEMENT BY AN INDORSEE TO HIS INDORSER.

HOWE MACHINE CO. v. HADDEN, ET AL.

United States Circuit Court, District of Indiana, April Term, 1878,

Before Hon. WALTER Q. GRESHAM, District Judge.

Several promissory notes were executed by one H to G, who assigned the same by indorsement to F. F afterwards assigned them by indorsement to G, who assigned them to plaintiff. Held, that F's liability as between himself and G being extinguished, the plaintiff, as G's indorsee, could not recover of F.

Baker, Hord & Hendricks, for plaintiff; Dye & Harris for defendants.

GRESHAM, J.:

This is a suit by the Howe Machine Company against Cornelius B. Hadden, Samuel O. Good and Jacob Fisher, on four notes of $500 each, executed by said Hadden to said Good. The first and second are dated March 17, 1875, and are payable twelve months after date. The third and fourth are dated April 2, 1875, the former due in four months and the latter one year after date. Each note is payable at the First National Bank of Indianapolis and is in the usual form of commercial paper. The first, second and fourth notes each bear the following indorsements:

"For value received I assign the within note to Jacob Fisher. [Signed] S. O. GOOD."

"For value received I assign the within note to Samuel O. Good. [Signed] JACOB FISHER." "For value received I assign this note to the Howe Machine Company.

dorsed the same (note) to the defendant, Fisher, who, in course of trade, indorsed the same to said Good, who in like manner indorsed the same to the plaintiff." Copies of the notes and indorsements are made part of each paragraph. The defendant, Fisher, demurs to each paragraph of the complaint.

It is clear that Good could not maintain an action against Fisher on the latter's indorsements. The law presumes from Good's possession of the notes, after their reindorsement to him by Fisher, that they were paid by Good as the first indorser.

And further, if Good could sue Fisher on the latter's indorsement, Fisher could turn round and sue Good on his prior indorsement. To prevent this circuity or multiplicity of actions, the law, in such cases, allows the liability of the first indorser to extinguish the liability of the second. Byles on Bills, p. 220; Bishop v. Haywood, 4 T. R. 470.

Fisher's liability being extinguished as between him and Good, can the plaintiff, Good's indorsee, recover from Fisher? In reason, it would seem not unfair to say that the indorsement and possession of Good, the payee, was prima facie evidence that he had got the notes back by payment or purchase. But if the indorsements on these notes were in blank there is authority for saying the presumption would be that Fisher had signed for the accommodation of Good. If a bill or commercial note be bought from the maker or some prior indorser before maturity in good faith, the indorsement being in the usual form, in blank, the presumption is that the subsequent indorsements were made for the accommodation of the maker or prior indorser. Palmer v. Whitney, 21 Ind., 58; Runyan v. Reed, 6 Am. Law Reg., 302; Malden v. Branch Bank, 2 Ala., 502.

The third note in suit was past due some time before any of the indorsements were made on it—as to it there is no ground for presuming that Fisher indorsed for Good's accommodation.

The indorsements on the first, second and fourth notes are without date, and the presumption is that they were made before maturity. But it will be observed that all the indorsements are special. Good, Fisher and the plaintiff are the only persons that have held the notes. Good, the payee, indorsed to Fisher, who reindorsed to Good, who then indorsed to the plaintiff. The plaintiff had no right to infer that Fisher had indorsed for the accommodation of Good. In fact, the special indorsements were notice to the plaintiff to the contrary, and informed it that Good had come into possession of the notes by payment or purchase. Knowing this, the plaintiff had no more right to buy the notes from Good, expecting to hold Fisher liable, than if it had known that Good had released Fisher for a consideration. It will not do for the plaintiff to insist that Fisher must be held to have indorsed for accommodation of Good, when in each paragraph of the complaint it is alleged that "said Good indorsed the same (note) to the defendant Fisher, who in course of trade indorsed the same to said Good, who in like manner indorsed the same to this plaintiff,”

Demurrer sustained.

MENT.

HARRINGTON v. THE FITCHBURG MUTUAL FIRE INSURANCE CO.

Supreme Judicial Court of Massachusetts, October Term, 1877.

1. MEANING OF "UNOCCUPIED BUILDING." — The phrase in a policy," whenever a building insured shall become unoccupied," does not mean that the absence of occupants of some of the apartments of a tenementhouse, while other apartments are occupied, shall render the building an unoccupied building.

2. EXCESSIVE VALUATION MADE IN GOOD FAITH. If a party honestly and in good faith applies for insurance upon property, the locality of which, and all the circumstances affecting the risk, he fully discloses, and discloses also the exact amount of insurance existing, and in good faith puts a value upon the property, and the existing insurance with what he obtains is less than three-fourths of the value as he believes, and represents it to be, and the defendants, with full knowledge of the amount of the existing insurance, and with a full knowledge of his valuation, issue a policy in which they consent to other insurance to the amount of three-fourths of the value, and it subsequently appears that in point of fact the real value at that time was less than the applicant believed it to be, this would not avoid the policy thus issued.

3. LOSS PAYABLE TO MORTGAGEE-ADJUSTMENT. -Where insurance effected by the owner of premises is made payable to the mortgagee thereof, in case of loss, the owner, after loss, in the absence and without the consent of the mortgagee, has no authority to adjust the loss.

The facts of the case appear sufficiently in the opinion.

LORD J., delivered the opinion of the court:

The history of this insurance, so far as it is developed by the facts before us, is this: On the 22d day of November, 1872, as appears by the date of the application, one Willard Bliss, who appears to have been the owner of the property, applied for insurance at the defendant's office, in the sum of $3,000, for the term of three years, commencing on the 1st of Nov., 1872.

The application is for insurance "upon the property described aud valued by the applicant, viz:" There then appears, printed in smaller type and included in brackets, "not more than threefourths the value of the property can be insured." There then follows a tabulated form with these headings:

DESCRIPTION OF PROPERTY | VAL. | INS. | PREM. $

$

3,000 | 60 |

On his tenement frame block | 9,000 3,000 | 60

C. 00

Beneath this form the different subjects upon which information from the applicant seems to be required are printed under these heads: "Situation of property;" "Descriptions of Buildings;" "Occupancy of the Buildings;" Interest in the property;" "Other insurance;" "Means of extinguishing fires;" "Surroundings;" "Warming and lighting." In this application under the head

ing, "Occupancy of the buildings," is this answer: By ten tenants as residences only." Under the heading "Interest in the property," the answer to the inquiry "is the applicant owner of the property," is "he is." To the inquiries, "if mortgaged, for what sum and to whom, and is policy to be payable to mortgagee," the answer is, "mortgaged to Samuel P. Harrington, payable to same to extent of mortgage claim." Under the heading, "Other insurance," against the inquiry "if any, at what office, and how much," are the words "other insurance permitted." And under the heading, "surroundings," are the words "see plan," and other specific answers are not material.

On Nov. 8, 1875, Patrick Johnson, who seems in the meantime to have become the owner of the estate, makes application upon a printed blank upon the head of which are the words: "Renewal of No. 34895," which was the number of the application of Bliss. This application is for insurance of the same sum of $3,000 for the term of one year, commencing upon the 1st of Nov., 1875. The description of property, valuation and sum to be insured are the same as in the former application by Bliss. The rate per cent. and amount of premium are respectinely 1 and 30, instead of 2 and 60. Across this space, against the several inquiries of "Situation of property," "Description of Buildings," and "Occupancy of the Buildings," is written transversely, the word "renewal." To the inquiries respecting "interest in the property," the answers are as follows: "Is the applicant owner of the property?" "yes;" "if mortgaged, for what sum, and to whom ?" "$4,000 to Samuel P. Harrington," ," "and is policy to be payable to mortgagee?""6 yes." To the inquiry as to other insurance, "if any, at what office, and how much?"

$3,000, Old Mutual, Worcester." Across this space for answers to all other inquiries, is written, also transversely, the word "renewal." Under the description of the property is printed with the exception of the figures, this line, "the dividend $30 on policy No. 34,895 may be applied towards payment for this insurance."

It will thus be seen that, though the ownership of the equity of redemption had been changed, the policy was substantially a renewal of a former policy upon the same property, for the same sum, and with the same encumbrance, and payable to the same person.

The building was partially destroyed by fire during the existence of the latter policy, and it is to recover the loss by such fire that this action is brought. The defendants contend that they are not liable for such loss, for these reasons: First, because "before said fire the policy declared upon by plaintiff had become void and of no effect for the reason that said building had been, and at the time of said fire was, unoccupied;" and, secondly, because "said Johnson had procured insurance upon said building without the consent of the defendants, and in excess of three-fourths of the value thereof."

They contend further that if liable upon the policy at all, they are liable only for the sum of $806.25, for the reason that there was an insurance in other

offices to the extent of $3,000, and that Johnson and the representatives of said companies made an adjustment of the loss, and that the whole amount of loss was agreed to be $1,612.50, and that their proportion under the policy is but one-half of said amount, to-wit, $806.25, and that the plaintiff is bound by such adjustment so made by John

son.

The first of these grounds of defence is not sustained by the facts. The building is described in the policy, as well as in the application, as a ❝ ten tenement block frame." There does not appear to be more than one building, or if the phrase "block" imports a separation into divisions, it does not, of its own face, import a separation into more than two divisions. The phrase "tenement block" gives but slight indication of what portions of the block the tenements consist, whether a single room, a floor, or flat, or suite of rooms. It imports only of necessity that the building is designed only for the accommodation of various families. The phrase in the policy, "whenever a building insured shall be unoccupied," cannot mean that the absence of an occupant of a single apartment of a tenement house, while other apartments are occupied, shall render the building an unoccupied building. The cases cited by the defendants do not in any manner sustain its position. Neither in Keith v. Quincy Mutual Fire Insurance Co., 10 Allen, 228, nor in Ashworth v. The Builders Mutual Fire Insurance Co., 112 Mass. 422, was there an occupancy within the meaning of that phrase, of the whole, or of any part of the building insured, and it would be doing violence to language to say that a tenement block, insured as a single building, is an unoccupied building with two of the tenements in actual use and occupation as residences. And while it is not within the words, it is not within the mischief which the clause is designed to protect the insurer against.

The other ground on which the defendant seeks to avoid the policy, is this: That while by the policy the plaintiff was entitled to insure to the extent of three-fourths of the value of the property, he had in fact insurance at the time of the loss to more than three-fourths of the value of the property at the time of the insurance.

This claim is founded upon this provision in the policy: "If without the consent of the company expressed in this policy the assured shall now have, or shall hereafter make, any other contract of insurance against loss by fire on the property, or any part thereof hereby insured, whether such other contract shall be valid or not as against the parties thereto this policy shall be void." At the time of the original insurance of the property and of the issuing of this policy, in renewal thereof, the property was valued at $9,000. In the first application, other insurance was permitted, and in the last application, other insurance to the extent of $3,000 was disclosed. This, with the $3,000 insured by the defendants, making in all an insurance of $6,000 which is less than three-fourths of the value of the property as stated in the application. But as the parties now agree, the $6,000 thus insured was more than three

fourths of the real value of the property at the time of the insurance. How much more it is not agreed. Whether it was inconsiderably more, or whether the difference was very great nowhere appears. There is no claim of fraudulent misrepresentation of the value of the property, nor is there any claim that the applicants themselves did not honestly and truly believe the valuation of $9,000 to be the true valuation. There is of course no presumption of fraud, nor has the court any right to look upon the conduct of the parties in the absence of evidence as actuated otherwise than by good faith, and with honest intentions. The exact question then, is, if a party honestly and in good faith applies for insurance upon property, the locality of which, and all the circumstances affecting the risk, he fully discloses, and discloses also the exact amount of insurance existing, and in good faith puts a value upon the property, and the existing insurance with what he obtains is less than three-fourths of the value as he believes and represents it to be, and the defendants, with full knowledge of the amount of the existing insurance and with a full knowledge of his valuation, issue a policy in which they consent to other insurance to the amount of three-fourths of the value, and it subsequently appears that in point of fact the real value at that time was less than the applicant believed it to be, would this avoid the policy thus issued? The mere statement of the proposition suggests its solution. The applicant tells where the property is; he tells what it is; he tells by what it is surrounded and the purposes for which it is used; all these are facts which he is bound to know, and in reference to which he is bound to tell the truth. Valuation is necessarily a matter of judgment or opinion, and it is matter of common belief that the owner of property is liable to put upon it a higher valuation than others. And there can be no injustice in the absence of fraud in holding the parties to such a contract as this to the valuation which was acted upon if not by both parties, at least by the applicant with the knowledge of the other party that he was thus acting. And this is especially true in this case in which the extent of insurance was fully disclosed, and in which the parties are fully protected against any liability other than their proportion of three-fourths of the value of the property. We are therefore of opinion that when all the facts and circumstances are honestly and in good faith disclosed, a mere error of opinion in an honest valuation of property fully described does not avoid the contract. There is less reason for strictness in this respect where the limit of insurance is three-fourths of the value, because the insured assumes a portion of the risk himself. And in analogy to other cases of insurance where property may be insured to its full amount, the valuation agreed upon, and for which insurance is issued, though it exceeds the real value of the property, if made in good faith, and without fraud, is conclusive between the parties. The defendants therefore are liable upon the policy, but by the terms of it for only one-half the amount of the loss, that being the proportion which their insurance bore to the whole amount insured. The

policy having been made payable to the plaintiff in case of loss, his rights were fixed at the time of the loss, and Johnson could no more adjust the amount of the loss, than he could release it. The defendants by the terms of their policy agreed to account with this plaintiff, and upon this question of amount of loss, Johnson, in the absence, and without the consent of the plaintiff, had no authority to act.

The result therefore is that judgment must be entered for the plaintiff for one-half the amount of the loss to be determined by an assessor unless the parties agree.

JUDGMENT FOR PLAINTIFF.

CHARITABLE BEQUESTS-ENGLISH STATUTES OPERATIVE AND INOPERATIVE IN THE UNITED STATES.

DE CAMP v. DOBBINS.*

New Jersey Court of Chancery, February Term, 1878.

1. CHARITABLE BEQUESTS WILL.-"The residue of my estate I give and devise to the North Reformed Church of Newark, in trust, that they may use the same to promote the religious interests of said church, and to aid the missionary, educational and benevolent enterprises to which the said church is in the habit of contributing," etc., is a good charitable bequest.

2. A MISNOMER OF THE LEGATEE will not defeat a gift.

3. THIRD PERSONS CAN NOT OBJECT to the capacity of a corporation to take such gift, on the ground that its property already equals the amount limited by the general law under which it is formed. The state alone can interfere.

4. IF THE CHARACTER OF A GIFT CAN BE DEFINITELY DETERMINED, and it appears that it is charitable in a legal sense, the use of terms which would, if unexplained, render the gift void, will not defeat the donor's purpose.

5. THE ENGLISH STATUTES in force and abolished in this country collected, and the decisions thereunder referred to in a learned note by the reporter.

On final hearing on pleadings and proofs.

Mr. Jacob Vanatta, for complainants; Mr. F. T. Frelinghuysen, for North Reformed Dutch Church. RUNYON, Chancellor :

Mrs. Eliza A. Crane, late of Newark, deceased, by her will, after sundry gifts, disposed of the residue of her estate as follows:

"The residue of my estate I give and devise to the North Reformed Church of Newark, in trust that they may use the same to promote the religious interests of the said church, and to aid the missionary, educational and benevolent enterprises to which the said church is in the habit of contributing; and I direct my trustees and executo: s to pass over to the officers of said church all property, either real or personal, remaining after satisfying the above-named bequests; and it is my will that the said church officials shall use and dispose of the said property at such times and in such manner as they shall deem expedient to promote the abovenamed interests, not holding the said property unexpended or unappropriated for a longer period of time than ten or fifteen years."

*From the advance sheets of the second volume of Stewart's New Jersey Equity Reports.

The residue of the estate will consist of real estate in this state, or the proceeds of the sale thereof, under the power of sale given to the executors by the will. It is claimed under the residuary devise and bequest by the North Reformed Dutch Church of the city of Newark, a religious corporation incorporated under the laws of this state. This suit is brought by the heirs at law of Mrs. Crane, for the purpose of obtaining the decree of this court declaring the residuary clause void on the following grounds, as stated in the bill: Because there is no such church as the North Reformed Church of Newark, and if there was at the death of the testator any religious society of that name in the city of Newark, it was unincorporated, and therefore could not take or hold property as a trustee, and because the persons who are to direct the uses of the trust are so uncertain, and the uses are so indefinite, uncertain and illegal, that they can not be executed as a charity or otherwise.

On the argument it was further urged that if the North Reformed Dutch Church of Newark be held to be intended to be designated as the trustee, that corporation is incapable of accepting the trust, inasmuch as it is, as the complainants insist, restricted in holding property to an amount not exceeding $2,000 a year, and it held property of that value at the time of the death of the testatrix. It is clear that the testatrix, by the words, "The North Reformed Church of Newark, intend"The North Reformed Dutch Church of Newark,“ of which she was at the time of her death, and for a number of years before that time had been a member, and in which church edifice she habituall attended divine worship, and to the funds of which she was in the habit of contributing for the purposes for which they were employed. A misnomer of a corporation in a gift to it will not defeat the gift. Smith's ex'rs v. First Pres. Ch., 11 C. E. Gr. 132. Besides, it appears that in 1871, the name of the general society of the Reformed Dutch Church in the states and territories of the United States was changed from "The Reformed Dutch Church of America, " to "The Reformed Church of America," and after that time the word "Dutch" was omitted from the corporate names of the churches constituting that society, among which the North Reformed Dutch Church of Newark, and that that church was, when the will was made, commonly designated as the North Reformed Church of Newark. A corporation may obtain a naine by usage. Alexander v. Berney, 1 Stew. 90. Nor have I any doubt of the capacity of that corporation to take and hold the gift and execute the trust on which it is given. A corporation may take and administer a trust which is within the general scope of the purposes of the institution of the corporation, or if the trust is collateral to its general purposes, but germane to them; as, if it relates to matters which will promote and aid the general purposes of the corporation. In such case it may take and hold, and be compelled to execute the trust, if it accepts it. Perry on Trusts, § 43. The gift in this case is upon a trust within the general scope of the pur

poses of the institution of the corporation. By its express terms it is to promote the religious interests of the church, and to aid the missionary, edcational and benevolent enterprises to which the church is in the habit of contributing. To spread the gospel at home and among the heathen; to promote education, and to contribute to the objects of benevolence, as the word is understood in its popular significance, are regarded as among the appropriate purposes of a Christian church.

It is urged that the corporation to which the gift is made in this case is incapable of taking the residuary property, because of the limitation contained in the law under which it was incorporated restricting the amount of property which it may hold to property not to exceed the annual value of $2,000. If such limitation did, in fact, exist, it would not incapacitate the corporation from taking the gift, although its property, at the time of receiving the gift, was of the full annual value of $2,000. If a corporation takes land by grant or devise, in trust or otherwise, which, by its charter, it can not hold, its title is good as against third persons and strangers; the state alone can interfere. Perry on Trusts, § 45; Bogardus v. Trinity Church, 4 Sandf. Ch. 633; Wade v. Am. Col. Soc. 7 S. & M. 663. And, again, if the limitation did, in fact, exist, the legislature might remove the restriction to permit the corporation to execute the trust, or authorize it to receive the gift and administer the trust, notwithstanding the limitation. This court, which will not suffer a trust to fail for want of a trustee, will uphold a trust for a reasonable time, when necessary, in order to enable the trustee to obtain the requisite authority to take and execute it. Bridges v. Pleasants, 4 Ired. Eq. 26, 30; Inglis v. Trustees of Sailors' Snug Harbor, 3 Pet. 115. But, again, the restriction insisted upon does not, in fact, exist. It was removed by the act of 1872 (P. L. 1872, p. 101,), which provides that any religious society incorporated, or to be incorporated, under the act under which the corporation which is made trustee in this case was incorporated, may purchase, hold and dispose of any real estate they may deem expedient, provided it shall not be used by the corporation for but one of two purposes, that of having on the premises a building for the worship of God, or for education or the administration of charity to the bodies or souls of men. The corporation, therefore, is not, in fact, restricted in its ownership of property to that which will not exceed in value $2,000 a year. It is, however, enough to say on this head, as has been before suggested, that if the corporation exceeds the prescribed amount, though it be by an original purchase, nobody but the state can interfere with the holding of the property which it acquires, and it is a matter of which individuals can not avail themselves in any way. Ang. & Ames on Corp., § 151; 2 Washb. on R. P., p. 567; Att'y-Gen. v. Bowyer, 3 Ves. 727; Vidal v. Phila. 2 How. 191; Wade v. Am. Col. Soc., 7 S. & M. 663. It is settled that a forfeiture by a corporation can not be taken advantage of, or enforced against it collaterally or incident

ally, or otherwise than by direct proceedings for the purpose. Ang. & Ames on Corp., § 777.

It is further urged in this connection that the trust is, by its terms, to be administered not by the corporation, but by the "church officials." The gift is to the corporation in trust for certain specified purposes, with direction that "said church officials" shall use and dispose of the property at such times and in such manner as they shall deem expedient to promote the interests before mentioned in the clause. The church officials had not been previously referred to, and it is evident that the testatrix used the words "church officials" instead of, and as synonymous with, the church or corportiod; or rather that she referred to them as the agents of the church.

The question, whether the trust is a legal charity, remains to be considered. The trust is "to promote the religious interests of the said church, and to aid the missionary, educational and benevolent enterprises to which the said church is in the habit of contributing." The law in this state on the subject of charitable uses does not, it has been authoritatively declared, differ from the common law of England on that head, which has grown up in a series of decisions founded in part on the statute of charitable uses, the 43d of Elizabeth, ch. 4. Norris v. Thompson's ex'rs, 5 C. E. Gr. 489. The general principle is, that courts of chancery uphold and administer gifts where they are made to particular purposes, which are charitable within the letter and spirit of the statute just referred to, or where they are made to charity generally, if there is a trustee with power to make them definite. The word "charity " has obtained a signification in law, and courts do not uphold or administer trusts for particular purposes which are not charitable within the meaning of the law, nor trusts expressed in general words which do not come within the legal signification of the word "charity." Perry on Trusts, § 709.

Gifts to charity are favored by our law for the reason for which they were favored by the civil law.

"Since legacies for works of piety and charity," says Domat, "have a double favor, both that of their motive for holy and pious uses, and that of their utility for the public good, they are considered as being privileged in the intention of the law." Domat. § 3,591. Both before and since the statute of charitable uses, gifts for the advancement, spread and teaching of Christianity, or for the convenience and support of worship or of the ministry, have been held to be charitable. Perry on Trusts, § 701. As has been well remarked by the writer just mentioned: "In a Christain community, of whatever variety of faith and form of worship, there will be little need of a statute to declare gifts for religious uses to be charitable." The church is an organization all of whose objects are within Mr. Justice Gray's definition of charity, in a legal sense. He defines it to be "a gift to be applied consistently with existing laws for the benefit of an indefinite number of persons, either by bringing their hearts under the influence of education and religion, by relieving their bodies