REED, V. C.
(Syllabus by the Court.)
Action by John Ruckelshaus against Charles Rorcherling to restrain the collection of a part of a judgment recovered. Decree for complainant.
Joseph Coult, for complainant.
Chauncey G. Parker and Cortlandt Parker, for defendant.
REED, V. C. The facts set up in the bill will be found stated in detail in the opinions delivered in this court and in the court of errors and appeals when this cause was before those courts on demurrer to the bill. 48 N. J. Eq. 436, 22 Atl. 184; 49 N. J. Eq. 340, 24 Atl. 547.
The following statement is deemed sufficient for the present purposes: Ruckelshaus, the complainant, was a tenant of Hugh H. McCulloch under a five-years lease, which would expire on April 1, 1885. McCulloch died on May 3, 1883. The rented premises had been the property of Mcculloch's deceased wife. McCulloch's estate at the time of the renting was that of tenant by the curtesy. At his death the heir at law of his deceased wife was her sister, Mrs. Mary J. Oehme. There was in fact upon record at the time of McCulloch's decease a deed purporting to be made by Mrs. Oehme, conveying the rented property to McCulloch in his lifetime. Upon McCulloch's death, Ruckelshaus was concerned to know to whom he should thereafter pay his rent. In the absence of any conveyance by the heiress, Mrs. Oehme, to McCulloch, the rent would be naturally paid to the former. Ruckelshaus, upon inquiry, however, was informed of the fact that Mrs. Oehme had during McCulloch's life made the deed mentioned. Ruckelshaus thereafter, for about 16 months, paid the rent to the agent of the heirs of McCulloch, who distributed it to numerous heirs living in different parts of the United States. On July 20, 1884, Mrs. Oehme, claiming that the deed which purported to have been made by her, conveying the property to McCulloch, was obtained by fraud, and that Ruckelshaus' term had expired with the death of McCulloch, began an action of ejectment against Ruckelshaus. In this action she succeeded. Following the judgment in that case, she brought an action for mesne profits, and recovered the value of the premises from the period of McCulloch's death down to October 1, 1885, when Ruckelshaus began the payment of the rent to her. This bill is filed to restrain the collection of a part of the judgment recovered for mesne profits. It is that portion of the judgment which includes the value of the premises from the death of McCulloch to the time of bringing the action of ejectment. The ground upon which the court is asked to restrain the collection of this portion of the judgment is that Ruckelshaus was led to believe, either by the words of Mrs. Oehme communicated to him or by her silence, when it was her duty to enlighten him, that the deed purporting to have been made by her to McCulloch was bona fide, and so he was led to pay his rent to the heirs of McCulloch. The estoppel thus raised against the representation of Mrs. Oehme is rested upon two grounds. The first is that Mrs. Oehme admitted that she made the deed purporting to be executed by her to McCulloch; that she knew at the time of these admissions that her words would be communicated to Ruckelshaus, and that he would be likely to shape his conduct by their import. The second ground is that, when she should have known that Ruckelshaus was likely to pay his rent to the agent of the heirs of McCulloch, in the belief that McCulloch died seised in fee of this property, she did not apprise him that she claimed to be still the owner of the property.
The facts upon which the first insistence is rested are these: It appears that when McCulloch died, one William McCulloch, a nephew of his, was at his uncle's house. After his uncle's death, William assisted in looking after his affairs. Among the papers of McCulloch he found two deeds; one purporting to convey some harbor lots to McCulloch, and another purporting to convey to McCulloch the rented premises in question. These deeds purported to be executed by Mary J. Oehme. William McCulloch seems to have asked a Mr. John H. Kase to administer upon the estate of McCulloch, deceased. Mr. Kase excused himself from undertaking the office on the plea of the pressure of his own business. Upon his declination, Charles M. Kase, the son of John H. Kase, was selected, the father having promised that he would render him what assistance he could in the practicalmentioned in them, and stripped her of her title to the Market street store. I have little doubt that he spoke to Ruckelshaus about the deeds, and told him that they were all right; nor do I doubt that he thought they were all right, and, at the time he gave his testimony, that he believed he had called Mrs. Oehme's attention to them with the result which he stated. It may be that he did so, but I do not think, in the face of Mr. Eastwood's testimony, that this fact is proved. It seems more probable that, if he spoke of this deed at all, it was in so general a way that Mrs. Oehme did not realize what was claimed to be its effect. Upon the first ground, namely, that Mrs. Oehme represented that the deed to McCulloch was genuine when she was informed that such statement was needed to convince Ruckelshaus that he should pay his rent to the agent of the heirs of McCulloch, I think that the complainant has failed.
The second ground, as already observed, does not depend upon any declaration made by Mrs. Oehme, but rests entirely upon her silence, when, as it is insisted, the circumstances put upon her the duty to speak. The insistence is that it is proved that she was informed or the claim that she was disentitled to the Market street property, and that by a deed purporting to have been executed by her the record title was in the heirs of McCulloch; that, upon being so informed, she left Ruckelshaus in ignorance of the fact that she challenged the genuineness of the deed; that the result of such silence was to permit Ruckelshaus to pay his rent to those in whom the legal title apparently resided; that such payment to said heirs Mrs. Oehme should have reasonably anticipated as the natural result of her muteness. The facts conclusively established are these: It is shown by the defendant's own witness Eastwood that early in June, 1883, Mrs. Oehme was told that the Market street property did not belong to her. It is proved that she immediately consulted Mr. Borcherling, and that Mr. Borcherling caused the records to be searched, and discovered the existence of two deeds; one of which deeds purported to be made by Mrs. Oehme, conveying to McCulloch the Market street property. It is proved that the ejectment suit was not begun until July of the following year, and that Ruckelshaus paid his rent during this interval to Mr. Kase, as the agent of the heirs of McCulloch. It is proved that Ruckelshaus had been careful in his inquiry concerning the right of the heirs to receive the rent, and that he was induced to make such payment to them by assurances from Mr. Kase and his counsel that title had been in McCulloch by force of the Oehme deeds. It is proved that up to the time of the commencement of the ejectment suit, July 20, 1884, he was never informed by Mrs. Oehme or by any other person that there was a cloud upon the title of the heirs. Once, according to the testimony of one witness, she, in person, collected the rent of her store,— the next to one of Ruckelshaus,—but neither at that time nor at any other time did she visit the complainant. All this time she is presumed to have been in communication with intelligent counsel. She must be presumed to have known—as I have no doubt she was informed—that the record title of the property was in McCulloch, just as the search of the record had disclosed. She must also have been presumed to have known that the rent belonged to the owner of the legal title, and that it would naturally be paid to those in whom the record showed such title. Had Mrs. Oehme, under these circumstances, stood by while one of the payments was made by Mr. Ruckelshaus to Mr. Kase, and held her peace, I do not conceive that there could exist a doubt that she, by her silence, would have precluded herself from saying that such payment should be again made to her. Yet it seems to me, under the conditions, her knowledge that the tenant would pay and was paying the rent to such agent is nearly as strong as if she had personally witnessed the actual payment. Here, then, we have the duty to speak, the failure to speak, and the conduct of Ruckelshaus, induced by her silence. This embodies all the elements of an estoppel in pais. Upon the phase of the case I think the complainant has proved his case.
But the counsel for the defendant interpose another objection. They insist that, even if the facts be as I have found them, and even if it follows as a legal inference from those facts that the defendant is estopped, yet the complainant is not free at this time to avail himself of the estoppel. This insistence is put upon the alleged existence of a counter estoppel by record. It is argued that the record judgment in the action for mesne profits precludes the defendant from now setting up this estoppel in pais. The argument upon this point is, in brief, this: It is said that the facts set up in the bill were just as available as a defense in the action for mesne profits as they are now as a ground for relief in this suit; that it follows that the judgment in that action upon general principles must be regarded as finally settling this point against the complainant; that while the court of errors, upon the face of the bill, held that the estoppel there pleaded was excepted from the operation of this general rule, yet the exception was put upon the ground that when such defense was proffered on the trial of the action at law it was overruled by the trial justice as not a defense available at law, and that this ruling was acquiesced in by the complainant, who had no exception thereto sealed; that the court of errors held that the defendant in the action at law had the right to regard the ruling ofthe trial justice as the law of that case, and so reserved to himself his right to invoke this equitable remedy. "It is argued, therefore, that the reservation of the right to come into this court rests entirely upon the fact that the ground upon which the present relief is asked was the ground tendered as a defense in the action at law, and was there overruled. Now, the point made by the defendant is that there is not to be found in this case any evidence that the ground now relied upon was the same ground that was set up as a defense in said trial. This seems to be true if we regard the testimony taken at the hearing; for in it there is nothing to disclose what the course of events was in the trial of the action at law in respect to this matter. But upon referring to the bill it will be found that in setting up the scope and character of the defense offered at such trial, it is not only charged that the complainant offered to prove that Mr. Kase had been told by Mrs. Oehme that she had executed the deed to McCulloch, and that Kase had so informed Ruckelshaus; but it is charged that the defendant offered to show that Mrs. Oehme lived in the city of Newark until long after the commencement of the suit, and from the time of the making of the lease to Ruckelshaus, and not far distant from the property in question; that she was the owner of the adjoining property; that she personally visited the adjoining property frequently, and collected the rents; and that she never, during all the time Ruckelshaus was paying rent to the McCulloch heirs, asked for any rent, made any inquiry in relation thereto, or made any inquiry about the premises in any way, or ever alluded to them in the slightest manner as her own. This part of the charge in the bill was admitted by the answer, and it contained, in substance, the facts upon which the complainant now relies to establish the second ground of estoppel, namely, that she was silent when it was her duty to speak. No proof in the trial of the cause was essential.
The remaining question is in respect to the extent of the relief to which the complainant is entitled. By reason of the silence of Mrs. Oehme he paid the rent to the agent of the McCulloch heirs from May 3, 1883, to July 20, 1884. That rent he was bound to pay to some one, either Mrs. Oehme or to the heirs of McCulloch. He is to be protected from being compelled to repay for any portion of this period. So far as the present judgment includes the profits for this interval of time, its collection should be enjoined. The effect of the judgment in the suit for mesne profits is not, however, to compel a repayment of this entire amount From the rental of $2,500 a year, which sum was fixed upon as the yearly value of the property, there was, upon the trial, by consent, deducted the amount of certain payments for interest upon a mortgage, and for taxes and repairs, which had been paid by Mr. Kase as the agent of the McCulloch heirs. The amount of the judgment represents the sum total of the amount which Ruckelshaus was bound to pay for that period, less the deductions made on account of the matters just mentioned. Ruckelshaus therefore will be fully protected against the consequences of Mrs. Oehme's conduct by relieving him from the payment of that portion of the judgment which represents the annual value of the premises during the period mentioned, less the deductions allowed upon the trial. I think the deduction of the particular items paid by Mr. Kase should be applied at the time they were made, and all payments for interest, taxes, and repairs made between the death of McCulloch and the commencement of the first ejectment suit should be deducted from the annual value of the property during that time, and the residue, with interest, should be regarded as the proportionate part of the judgment, from the payment of which Ruckelshaus should be discharged. A decree will be advised in conformity with these conclusions.