place between these parties at that time concerning how much was due for principal and how much was due for interest, and that no clear understanding was had by either of them as to what this payment was to cover. I think, probably, the male defendant, the mortgagor, had the idea that it would pay the interest, and that anything over would go on account of principal; but I doubt very much whether he stated it in such a way as to have the complainant understand it, and I do not believe that the complainant did so understand it.

At that time the defendants owed 50 cents still on interest due April 1, 1908, the quarterly interest on the unpaid principal due July 1, 1908, and three installments of $75 each on account of principal, less the credit of $25 paid June 15, 1908, making $200 in all of principal. The male defendant's own testimony is that at the time of the July payment nothing whatever was said by him as to how this should be credited; and there is no testimony by any witness on behalf of the defendants of any direction or suggestion on behalf of the defendants as to how this payment made on July 4, 1908, should be credited. The receipt given at that time is, as has been stated, "payment on house."

The complainant testifies squarely and unequivocally that it was stated to be for principal-that is, on account of the unpaid installments of principal. The complainant undoubtedly did appropriate this payment on account of principal. In his bill, filed Au

Thereafter, as I have stated, two other payments were made, one in June and one in July, and each for $25, and the receipts in each instance are practically the same. They were written by the male defendant and signed by the complainant. In each instance they recite the receipt of $25 as “payment on house." Since these receipts were written by the mortgagor, they, of course, must be taken most strongly against him, and it is quite sig-gust 8, 1908, he specifies the first default in nificant that not one word appears in any of these receipts about interest, although in the earlier receipt of July 5, 1907, where interest was paid, it is specifically mentioned; and it is also significant that the June, 1908, receipt, which is recited to be "payment on house," was paid at a time when, according to the defendant, there was no interest due, but he used the same language, namely, "payment on house," that he used in the receipt of April 18, 1908, which he says was practically wholly for interest, and not any part of it "payment on the house," or payment on the principal of the mortgage. The law undoubtedly is that the debtor may direct the application (2 Am. & Eng. Ency. of Law [2d Ed.] p. 435); and if the creditor receives the money, even though he does not assent to such application, he is bound to make it if he receives the money under such direction (Id. 448).

Giving the defendants the fullest benefit of their testimony, this would result in requiring the complainant here to give the defendants credit on account of interest for the $25 paid on the 18th of April, 1908. At that time, as I carry the figures, the situation was as follows: The principal sum had been reduced $150, leaving still due $850. At the time of this April payment there were two back installments of interest, each of which amounted to $12.75. Without figuring interest on the first one of these, there was due on account of interest on the 1st of April, 1908, these two installments, amounting to $25.50. Since he paid $25, which is to be credited to interest, he owed still 50 cents for interest and $150, being two installments of $75 each, on account of principal. On the 15th of June he makes a payment of $25. Since, leaving out the 50 cents of unpaid interest, no interest was due at that time, this would be necessarily credited to principal; there being installments of principal due.

interest as occurring on April 1, 1908; but at the time of filing the bill another default had occurred more than 30 days previously, namely, upon the interest due July 1, 1908. With respect to the April period I have, as above stated, given the defendants the fullest benefit of their testimony, and have held that that should be credited as interest, so that there was no default at that time. But there was a default of the interest due July 1, 1908; the payment made on July 4, 1908, as above stated, not having been appropriated in any manner by the debtor and having been appropriated by the creditor to the unpaid installments of principal. Since the debtor entirely failed to give any direction or suggestion as to the appropriation of this payment, it was within the right of the creditor to appropriate. 2 Am. & Eng. Ency. of Law (2d Ed.) 437, and the following New Jersey cases dealing with the principle involved: White v. Trumbull (Sup. Ct., 1836) 15 N. J. Law, 314, 318, 29 Am. Dec. 687; Terhune v. Colton (Ct. of Er., 1857) 12 N. J. Eq. 312; Edwards v. Derrickson (Sup. Ct., 1859) 28 N. J. Law, 39, at page 67; Oliver v. Phelps (Sup. Ct., 1843) 20 N. J. Law, 180, at page 197; Turner v. Hill, 56 N. J. Eq. 293, 39 Atl. 137 (Grey, V. C., 1897).

The defendants suggested that this was a case in which the court should appropriate the payments; but the rule is that the court will only make the application where neither party has appropriated it. Terhune v. Colton, supra, at page 320; 2 Am. & Eng. Ency. of Law (2d Ed.) 447. Since I find that the debtor did not appropriate this July payment, nor give any suggestion or direction with respect to it, the law permitted the creditor to make the appropriation. Before any controversy arose between the parties he did make such appropriation, and determined to appropriate it to the unpaid installment of principal. This was his right, and he made

ing, as stated in Terhune v. Colton, supra, that the creditor may make such appropriation at any time prior to a controversy arising. 2 Am. & Eng. Ency. of Law (2d Ed.) 446. The result is that the defense fails, and the complainant is entitled to a decree.

If technical precision is better obtained by so doing, the complainant may now amend his bill by specifically setting up a default with respect to the payment of interest due July 1, 1908. The presence or absence of such a charge, however, does not, in my view, affect the substantial merits in the least.

(75 N. J. E. 386)

HARRIS v. BARRETT et al.

at the rate of $12 per week was ordered paid. He defaulted in his payments, and in 1903 or 1904 was committed to jail in contempt proceedings.

Upon the complainant, of course, rests the burden of proving that he is the owner of the bond and mortgage which he seeks to foreclose. He and Barrett each testify that the mortgage was obtained from the mortgagee, Levy, some time in the year 1888, about 18 months after its date, and about 18 months before it was due. There is, of course, a very apparent motive or reason for fixing some period before 1890 as the time when Harris became possessed of the mortgage, because in 1890 the title became vested in Mrs. Barrett, and Barrett could not, of course, as

(Court of Chancery of New Jersey. April 15, against her, renegotiate the mortgage, if it 1909.) should be held that he had paid it off, and 1. MORTGAGES (§ 460*)-FORECLOSURE-BUR- he certainly would not dare suggest that he DEN OF PRoof. One seeking to foreclose a bond and mort- had paid the mortgage off after that period, gage given to another has the burden of prov- because his testimony is that he was coning that he is the owner of the bond and mort-stantly at odds with his wife and would not likely pay $2,800 solely for her advantage. However this may be, they, as a matter of fact, each fix the period when Harris became

gage.

[Ed. Note. For other cases, see Mortgages, Cent. Dig. & 1351; Dec. Dig. § 460.*]

self.

2. EVIDENCE (§ 588*)-WEIGHT OF TESTIMONY. The court is not bound to accept every-possessed of the bond and mortgage as some thing as true a witness may say, and evidence, time between May and July, 1888. They do to be believed, must not only proceed from a not agree as to the time, and the testimony credible witness, but it must be credible in it- of each varies at different times as to the date. They testify that at the time Harris got from a man named Cohen $2,800 in currency and brought it to Barrett, who took it to Levy and obtained the bond and mortgage, and gave them to Harris, who gave them to Cohen, who held them for 12 or 13 years, and then gave them to Harris.

[Ed. Note.-For other cases, see Evidence, Cent. Dig. § 2437; Dec. Dig. § 588.*] 3. MORTGAGES (§ 463*)-FORECLOSURE-EVIDENCE-SUFFICIENCY.

In a suit to foreclose a bond and mortgage, evidence held not to show that complainant is the assignee or rightful owner of the bond and mortgage, defeating a recovery.

[Ed. Note. For other cases, see Mortgages, Dec. Dig. § 463.*]

Suit by Aaron Harris against Montague P. Barrett and others to foreclose a mortgage. Heard on bill, answer, replication, and proof in open court. Decree denying relief.

S. C. Cowart and Mr. Meyers, for complainant. B. P. Morris and Mr. Jacobson, for defendants.

Excepting the bond and mortgage, there is no writing of any kind, sort, or description to cast any light upon any portion of the transaction. There is no assignment, no receipt, no letters, no checks, and the entire case depends upon the testimony of witnesses. The determination of the case, therefore, will depend upon what the court finds to be true from the testimony of these witnesses; and, with respect to whether this mortgage was paid or was purchased, the determination will depend largely, if not wholly, upon the view taken by the court of the testimony of Harris and of Barrett, when tested by itself and by such other slight facts as it was possible to prove in contradiction or opposition thereof.

GARRISON, V. C. Henry J. Barrett owned a property at Long Branch, N. J. On the 31st of January, 1887, Louise Barrett, his wife, joined in a mortgage to Philip Levy for $2,800, payable in three years, at 5 per cent. interest. This bond and mortgage were produced in court and claimed to be At the time when they allege that the owned by Aaron Harris. Harris is a nephew mortgage was obtained from Levy, it had of Barrett. Barrett and his wife did not at least half of its life to run; that is, it live happily together, and frequently sepa- was not due for about a year and a half. rated from each other for short periods of The mortgage drew 5 per cent., and Harris time. After one such separation, and as an testifies that the land was worth more than element in the reconciliation, Barrett, in the amount of the mortgage. At that time June, 1890, conveyed this Long Branch prop- Barrett was a well-to-do business man. He erty, through a trustee, to his wife. On the is shown to have owned the property subject 18th day of October, 1901, Mrs. Barrett, se- to the mortgage, the house in which he and cured a decree of divorce from her husband his family lived in New York, three large in the Supreme Court of New York. Alimony tenement house properties on the Bowery in

New York, and to have had considerable mon- | Harris 6 per cent. interest on $2,800 in semiey besides. Harris was a clothes cutter, annual payments. When examined separateworking for small wages, and having ab- ly, Barrett testified that he always obtained solutely no means whatever. Both Harris written receipts from Harris for each payand Barrett allege that Barrett was very ment of interest made him during all these much perturbed because this mortgage would years; and Harris testified that he never be due in a year and a half, and he feared gave written receipts at any time to Barrett. that the mortgagee would press him for the It is quite obvious that this is not a matter money, and that the anticipation of this sit- about which there could be any honest difuation wrought him up to such an extent ference of opinion, or honest failure to rethat he went around a year and a half be- member. It involves 32 separate incidents; fore the mortgage was due searching for that is, 32 semiannual occasions upon which some one to take it up, and being willing, if a receipt either was or was not given, and they would do so, to agree to pay them 6 per with respect to each one of these 32 occacent. interest, instead of 5 per cent., upon the sions Barrett says he obtained a written rechance that the person who would take up ceipt (all of which he claims to have lost), the mortgage would not press him so vigor- and Harris avers (without having heard of ously as he feared the mortgagee would. In Barrett's statement) that he never gave any this state of mind he turns to this impecuni- receipts. Clearly one of the parties is guilty ous nephew. Harris avers that he thereupon of false swearing in this important parwent to an uncle of his wife, named Cohen, ticular, and, in my view, both of them are represented to him that there was this good so guilty with respect to the very matters mortgage for $2,800, at 5 per cent., which at issue. I am not able to believe (and my would be raised to 6 per cent., and that his disbelief is strengthened by the appearance uncle said that if the property was good he and manner of the witnesses on the stand) would advance the money and immediately that this poorly-paid young clothes cutter did so, without making any investigation or obtained $2,800 in currency from his wife's inspection or seeking any legal assistance. uncle in 1888, and invested it, without invesAccording to Harris, he obtained the money tigation, legal assistance, or written papers, from his uncle immediately after mentioning in this bond and mortgage, and held them the matter to him, and there is not the for 18 or 19 years without any effort to colslightest pretense that the uncle employed lect the same-particularly in view of the anybody to see that the mortgage was good, fact that the only person outside of himself or that the property was worth the money, whom he claims to have any reason to conor, in fact, hesitated long enough to have sider was Barrett, and Barrett, after 1890, even considered these matters himself. Har. had no title to this property, and the title ris thereupon immediately brings the $2,800 was in his wife, with whom he was at odds, thus obtained to Barrett. Harris' testimony and from whom, in 1901, he was divorced. makes it utterly impossible to determine Further, I am utterly unable to believe that what the relation between Cohen and him Barrett, from 1888 to 1904, continued to pay was with respect to this money. He refers 6 per cent. interest to Harris upon this bond at times to it as a loan. He says he borrow- and mortgage upon property to which he lost ed the money. Again, he speaks of it as mon- title in 1890; such payments, if made, beey given to him by his uncle. Sometimes he ing wholly in favor of his wife, with whom says, "He gave me the money," but does not he was upon the outs, and from whom he specify whether that merely refers to the was divorced, as I have before stated, in act of handing it over, or whether he means 1901. When we consider that in 1903 or to imply that it was a gift. 1904 he was committed to jail for failure to pay the alimony due his wife, and yet claims that during the very period in which he incurred this penalty he was paying interest on this bond and mortgage solely to favor his wife, his story, to my mind, lacks all credibility.

His testimony is no more satisfactory with respect to the relationship which he and Cohen held with respect to the bond and mortgage. As to them he says that he took them; immediately upon obtaining them from Barrett, and gave them to Cohen, and that Cohen put them in a trunk and kept them there for 12 or 13 years. He gives various reasons for his conduct in this respect. At times he said that it was to show his uncle that he was honest; that it was as security for the money; that he took it to his uncle because he had put the money in them, and he wanted his uncle to have the papers; and that he took them to Cohen for safe-keeping. After 13 or 14 years, for no reason which is given or suggested, Cohen handed the papers back to Harris. Harris and Barrett

The wife, one of the defendants in this suit, was necessarily limited in her ability to directly meet the testimony of Harris and Barrett. She and her sister do testify to conversations in 1888 concerning the payment by Barrett of this mortgage. They swear that at that time he was in possession of considerable money and was talking of how he should invest it, and that his wife's father suggested that he pay off this mortgage, and Barrett told them afterwards that he had done so, and also, when angry at his wife,

had paid it off. His wife says that this ceed from the mouth of a credible witness, statement was made after he had conveyed but it must be credible in itself, such as the the property to her, and had quarrelled with common experience and observation of manher, and was angry that he had paid off a kind can approve as probable under the cirmortgage which, if he had not done so, would cumstances. We have no test of the truth rest upon property now owned by her, and of human testimony, except its conformity he would be benefited by having the money, to our knowledge, observation, and experiinstead of having benefited her by its pay- ence." Daggers v. Van Dyke, 37 N. J. Eq. ment. There is also some slight evidence 132 (Van Fleet, V. C., 1883). And see, to of a loan by Barrett to Harris some years like effect, Elwood v. West. Union Transp. after the mortgage was alleged to belong to Co., 45 N. Y. 549, 6 Am. Rep. 140; Kearney Harris; and there is uncontradicted evi- v. Mayor, etc., 92 N. Y. 617. dence that several fires have occurred upon the premises, and that the insurance has been collected by Mrs. Barrett, Harris not having paid any attention to whether there was insurance on the property or not, and during all of the 18 or 19 years that he claims to have owned the mortgage not having paid the slightest attention to the property on which the mortgage was claimed to be a lien.

Harris, who is never shown to have had a dollar in his life, waves all this aside with the statement that $2,800 did not seem much to him, and that accounts for the light way in which he treated this matter. This, really, is characteristic of his entire testimony, and is a cogent reason, in my mind, for disbelieving him and his entire story. Bluntly stated, I do not believe his testimony or Barrett's testimony. I do believe that Barrett paid this mortgage off with his own money, and for some reason, or no reason, did not attend to its cancellation at that time, and that years afterwards, and after he had conveyed the property to his wife, and had quarrelled with her, and desired to injure her, he handed this bond and mortgage over to his nephew, in order that the latter might foreclose the same and either obtain the money out of the land the husband had conveyed to the wife or take the land away from her by a sale. As a trier of fact I have reached the unshaken conclusion that Harris is not a bona fide holder of this bond and mortgage, that he did not procure the same by assignment from Levy, that he did not procure the same by the advancement of any money thereon, and that he has no right to hold the same as a valid, subsisting lien as against Mrs. Barrett, the owner of the land.

Har

When I weigh and test the evidence of these two witnesses, Harris and Barrett, I am utterly unable to believe that either of these two men, situated as they were, could or would have behaved as they testify they did. There is really nothing credible in their testimony about any one important circumstance concerning which they testify. There is nothing credible in Barrett's suggested reason for desiring to obtain an assignee of the mortgage at the time that he says he sought one, and there is nothing credible in his statement as to the circumstances under which he got the money from Harris. ris' testimony with respect to the important facts is equally incredible. That a poorly paid, impecunious young man should obtain for the asking $2,800 from an uncle of his wife, and should hand it over to his own uncle for a mortgage about which he knew nothing, and should not obtain any writing from the owner of the mortgage to show that he relinquished his ownership or transferred it, and should not have consulted any business man or lawyer concerning the matter, and should have parted with the possession of what he claims was his for 12 or 13 years, and during 18 or 19 years have paid no attention whatever to the real estate upon which the alleged mortgage rested, and should, if he did get interest, not give receipts and not have any checks, assignments, receipts, or other writings of any description concerning the matter, present points of improbability so strong that I was not, at the time of hearing his story, and am not now, after reading it over, able to believe any of it. And, when the motive of these two men at the time that this foreclosure was begun is suggested, I think their whole conduct seems clear.

The opportunity arose when Barrett discovered, after many years, as I believe, that he still had this old bond and mortgage, which he had paid off either in 1888 or at some later period. He was divorced from his wife, and had gone to jail at her procurement because he did not pay her alimony; and here was a chance to make her suffer either the payment of this money or the loss of the property. There was practically no one so usable in this emergency as this nephew, and to him he gives the bond and mortgage, and through him he seeks to carry out this

The sole question that I paused to consider after the trial, and upon which I have taken the briefs of counsel, is whether, in view of the fact that Harris and Barrett each swore to that which would lead to a contrary decision, I was bound to take their testimony upon points which the defendant was not able to contradict. I have reached the conclusion that I am not so bound. Without attempting to formulate a doctrine, I find that a trier of facts must be left free to believe or not to believe testimony which is subject to ques tion. "The court is not bound to accept everything as true a witness may say. Evi

I do not find that it is proven that Harris | soever, that would disturb the peace and is the assignee, or rightful owner of this bond and mortgage, and therefore find that the complainant may not succeed, and will decree accordingly.

MAYOR, etc., OF BOROUGH OF VINELAND et al. v. KOTOK et al. (Supreme Court of New Jersey. April 30, 1909.) MUNICIPAL CORPORATIONS (§ 639*) -COMPLAINT ORDINANCES-REQUISITES.

A complaint for disorderly conduct, in violation of a city ordinance, failing to allege that the disorderly conduct charged was within the limits of the borough, was fatally defective.

[Ed. Note.-For other cases, see Municipal Corporations, Cent. Dig. § 1406; Dec. Dig. § 639.*]

David Kotok and others were convicted of disorderly conduct, and they bring certiorari. Reversed.

Argued November term, 1908, before REED, BERGEN, and MINTURN, JJ. Henry S. Alvord, for prosecutors. Edwin F. Miller, for defendants.

PER CURIAM. This writ brings up a conviction by the recorder of the borough of Vineland for the violation of an ordinance of the borough. The complaint before the recorder charged: That on the morning of August 28, 1908, David Kotok, Israel Kotok, and Frank Kotok did, in violation of ordinance No. 4, act in a disorderly manner by interfering with the deponent Samuel Salumsky, in the prosecution of business; that the said David Kotok did ill treat and abuse deponent by pushing him down and striking him in the face; that the said Israel Kotok did hit the deponent's mother, and also the deponent; and that the said Frank Kotok did make threats to do violence to the body of the deponent-all acting in a disorderly manner, in violation of the said borough ordinance.

quiet of any family, neighborhood, or any of the inhabitants of the said borough, he or they shall be liable to a fine not exceeding twenty dollars, or imprisonment in the borough lockup or the county jail for a term not exceeding ninety days, in the discretion of the mayor." Sections 2 and 3 have no relevancy to the charge contained in the complaint. All three of the defendants were convicted, and a fine of $15 was imposed upon one, and $5 each upon the other two.

Several questions were discussed in the brief of counsel, but it is sufficient to say that the conviction must be reversed upon the ground that neither in the complaint, nor in the conviction, was it stated that the

disorderly conduct charged was within the

limits of the borough of Vineland.
The conviction is reversed.

(78 N. J. L. 114) MANCHESTER BUILDING & LOAN ASS'N V. GRAHAM et al.

(Supreme Court of New Jersey. April 30, 1909.) PRINCIPAL AND SURETY (§ 83*)—LIABILITY OF SURETY.

A bond to make good the deficit of A., & and delivered to A.'s attorney not to be used defaulting employé, was executed by A. and one if A. was prosecuted. At the same time A. made a deed to G. to secure him against liability on the bond and left the deed with the atA. had been indicted, the bond had been delivtorney. Thereafter G., knowing that, though ered to the obligee, secured the deed from the attorney, recorded it, and took possession of the property, giving no warning to the obligee that the bond had been delivered without authority. Held, that in an action on the bond G. could not set up the attorney's lack of authority to deliver it both by estoppel and ratification.

[Ed. Note. For other cases, see Principal and Surety, Dec. Dig. § 83.*]

Error to Circuit Court, Passaic County. Action by the Manchester Building & Loan Association against James A. Graham and another. Judgment for plaintiff, and defendants bring error. Affirmed.

Argued November term, 1908, before REED, BERGEN, and MINTURN, JJ.

William B. Gourley, for plaintiffs in error. J. W. De Yoe and Michael Dunn, for defendant in error.

Section 1, ordinance No. 4, alleged to have been violated, provides: "That if any person shall congregate or assemble in a riotous or disorderly manner in the streets, public places or public halls, or if any person or persons shall at any time be found upon the streets. sidewalks, steps or platforms of REED, J. This is an action on a bond stores, groceries, saloons, public halls, made by George B. Allee and James A. Grachurches or railroad stations, or within or ham to the Manchester Building & Loan Assoaround any building, dwelling house or pub- ciation conditioned for the payment of $2,000. lic place within said borough, behaving in The execution of the bond arose from the a disorderly manner, by drunkenness, by us- following situation: George W. Allee had ing profane or indecent language, by making been secretary of the Manchester Building & insulting remarks to, or comments on oth- Loan Association and was in arrears in his ers, or unnecessarily congregating in groups accounts with the association about $14,000. upon the streets, sidewalks or in public To assist in making restitution of the amount places, to the obstruction thereof, or to the of this deficit, Mr. Allee and Mr. Graham on annoyance of passers-by, or by unnecessarily the 21st day of May, 1906, executed this bond doing or performing any other thing what- to the association and left the same in the