Raleigh v. Fitzpatrick

• Court: New Jersey Court of Chancery
• Citation: 43 N.J.E. 501,11 A. 1
• Parties: RALEIGH v. FITZPATRICK and others.
• Decision Date: 29 October 1887

11 A. 1

43 N.J.E. 501

RALEIGH

v. FITZPATRICK and others.

Court of Chancery of New Jersey.

October 29, 1887.

[Copyrighted material omitted.]

Bill for relief, accounting, and receiver.

Herbert A. Drake and Theo. Runyon, for complainants. Leon Abbett, for defendants.

BIRD, V. C. Shall the preliminary injunction issued in this case be dissolved on this motion? is the question presented for the consideration of the court. Nothing short of a clear and concise statement of all the facts out of which this litigation arose can satisfy the mind that the conclusion reached is the correct one, whether the motion be granted or not. It should be noted that the facts disclose a portion of a family history, and an effort made by the members thereof to preserve all of the inheritance left to them by their ancestor as nearly intact as possible, and to make a profit out of that which they found themselves obliged to dispose of for the sake of the preservation of the rest.

Maurice Raleigh, of the city of Philadelphia, being possessed of large real and personal estate in the city of Philadelphia, and of about 30,000 acres of land in the counties of Cumberland, Burlington, and Atlantic, in New Jersey, departed this life in the year 1882, having first published his last will and testament giving directions for the disposition of his estate, and appointing executors. The agreements which the heirs at law, legatees, and devisees, and the executors entered into, as hereafter recited, show the necessity for such agreements, and the earnest desire upon the part of all interested to effect the purpose therein expressed.

October 1, 1884, James Raleigh, Walter Raleigh, Mary Raleigh Fitzpatrick, Martha F. Raleigh, Kings Raleigh, and Catherine R. Raleigh, of the first part, being the children of the said testator, and James G. Fitzpatrick, the husband of the said Mary, entered into an agreement in which they recited that they were interested in the said real estate in New Jersey, and that they had determined, for the purpose of closing up and disposing of it, that it should be sold for the sum of $150,000; and that the said devisees authorized thereby the said James G. Fitzpatrick to sell the same, or to procure it to be sold, to a company to be formed under the laws of the state of New York, the capital stock of which should be $600,000, and that he should accept from said company 4,000 shares as payment of the sum of $100,000 in cash; which said 4,000 shares they thereby covenanted and agreed that the said party of the second part should deposit with the treasurer of said company as security for the payment of a mortgage executed as a lien upon said premises for the sum of $100,000, in favor of the executors of the will of said Maurice Raleigh, deceased; and they thereby nominated the said Fitzpatrick as their true and lawful attorney, and vested in him sole and exclusive power to vote upon said stock in their name. And they agreed, also, to execute and deliver to the said Fitzpatrick, on demand, from time to time, as he might require the same, good and sufficient proxies, for the purpose of enabling him more effectually to vote upon the said 4,000 shares of stock; and they further authorized the said Fitzpatrick to deliver to one Richard S. Newcombe, a lawyer of the city of New York, for services rendered by him in connection with the said 4,000 shares, stock equal to the value of $6,000, in cash.

On the same day in October another paper writing was made and signed, by which the said James G. Fitzpatrick and Walter Raleigh, as trustees, of the one part, and B. Lobenthall and James W. Dell, executors of Maurice Raleigh, of the other part, agreed with the executors, with the consent of the widow, devisees, and heirs of Maurice Raleigh, deceased, and upon their executing a proper release, releasing the said executors from all liability to account for the sale of the said lands, to sell to the said Fitzpatrick and Walter Raleigh, as trustees, the said lands in New Jersey, for the sum of $150,000, and to deliver deeds therefor on or before the thirty-first day of December then next ensuing. Fifty thousand dollars of the said purchase money was to be paid in cash, and $100,000 secured by bond and mortgage upon said property, payable in five years, and without interest until December 31, 1885, and interest thereafter at the rate of 4 per cent., payable half-yearly; but said mortgage was to contain a clause providing for the release of such portion or portions of said property as might be sold, upon the payment of two-thirds of the purchase money on account of said mortgage; restraining, however, the sale of any of the said lands for less than $5 per acre; with the usual proviso that, upon failure of the payment of the interest within 30 days after any half-yearly payment should become due, the whole principal and all interest should become due and payable.

Upon the same day the said trustees, as such, and all of the said heirs and devisees, together with the widow of Maurice Raleigh, made and executed another writing, which witnessed that the said trustees, heirs, and devisees agreed to execute and deliver to the said company so to be formed, on or before the thirty-first day of December, 1884, a good and sufficient deed of all the real and personal property belonging to the said estate of Maurice Raleigh, subject to a mortgage of $100,000, payable as already expressed, being the same mortgage above referred to, and that the said company, as about to be formed, agreed to pay therefor the sum of $600,000, delivering 4,000 shares of said stock, of the par value of $100 per share; which said 4,000 shares were to be deposited with Moritz Cohn, as treasurer of the said company then about to be formed, and held by him in trust, and as security for the payment by the said trustees of the said mortgage of $100,000.

On the same day the said heirs and devisees stipulated in a separate writing that the said James G. Fitzpatrick should pay to the said Richard S. Newcombe $1,000 out of each of their respective shares of said stock, in all $6,000, as compensation for the services rendered by him in perfecting the said arrangements or negotiations.

In furtherance of the main design, and upon the same day, the said heirs and devisees entered into an agreement in writing with the said James G. Fitzpatrick, in which it was recited, that "whereas, the said parties of the first part were entitled to real estate in Pennsylvania and New Jersey, under the will of the said Maurice Raleigh, and it had been agreed between them that their respective interests rendered it desirable that none of the property except the property in the state of New Jersey should be sold, which it had been agreed should be vested in the company to be formed for the purpose of holding said property, and disposing of it as the company might deem best," and in which they then covenanted and agreed that they, the said heirs and devisees, would not, nor would either of them, sell or in any way dispose of or incumber their or any of their rights or interests in said property; and that they thereby transferred and conveyed to the said James G. Fitzpatrick all their right, title, and interest in and to the same, both in the state of Pennsylvania and in the state of New Jersey, in trust; that out of the income of the property in Pennsylvania he would pay all sums necessary for keeping the said property in repair; that he would pay all taxes and assessments levied upon the same, and all insurance premiums necessary, and the interest upon all mortgage liens; and that the balance he would pay to the said heirs and devisees. They also transferred to the said James G. Fitzpatrick all the income of the property in New Jersey, in trust, that he should apply the same towards the payment of the mortgages then existing upon the property in Pennsylvania, and any surplus which might remain to invest the same upon bond and mortgage.

This power of attorney and declaration of trust all of them but Mrs. Mary R. Fitzpatrick undertook by writing to revoke on the tenth day of August, 1885, and on the eighth day of October, 1884, the said James G. Fitzpatrick and Mary R., his wife, executed a writing in and by which they undertook to revoke the trust contained in the last aforesaid agreement, bearing date October 1, 1884. In view of these agreements, and by virtue of the power of attorney, a company was organized under the laws of the state of New York by the said James G. Fitzpatrick, Richard S. Newcombe, Moritz Cohn, Jeremiah Fitzgerald, John T. Farley, and Albert Cardoza, whose certificate bears date the——day of December, 1884; and it was incorporated for the purpose of carrying on the business of purchasing and improving real estate for residences, homestead, and apartment houses, to be leased and conducted by the said company, and occupied by the stockholders thereof, with a capital stock of $600,000, just the amount contemplated in all the above-named agreements; to consist of 6,000 shares, of $100 each; which certificate was filed and recorded according to law. About the tenth of February, 1885, the said executors conveyed all the said land in the state of New Jersey to the said Walter Raleigh and the said James G. Fitzpatrick, trustees for the devisees of Maurice Raleigh, deceased, the consideration therein named being $150,000; and about the same time the said trustees made a mortgage on the same premises to the said executors, to secure the bond of the said trustees of the same date for the payment of $100,000 in the manner above stipulated; and upon the same day the said trustees executed and delivered a conveyance of the said property, so mortgaged, to the said corporation, called the "Raleigh Land & Improvement Company," the consideration mentioned therein being $600,000. At the time of this transaction there was a mortgage incumbrance of $50,000 upon the premises. Of the consideration...