Case Name: EDWIN S. DICKERSON, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, DEFENDANT; WILLIAM L. ALLEN, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, A BODY CORPORATE, DEFENDANT
Court: New Jersey Supreme Court
Jurisdiction: New Jersey
Decision Date: 1924-05-07
Citations: 100 N.J.L. 80
Docket Number: 
Parties: EDWIN S. DICKERSON, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, DEFENDANT. WILLIAM L. ALLEN, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, A BODY CORPORATE, DEFENDANT.
Judges: 
Reporter: New Jersey Law Reports
Volume: 100
Pages: 80–82

Head Matter:
EDWIN S. DICKERSON, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, DEFENDANT. WILLIAM L. ALLEN, PLAINTIFF, v. WILKES-BARRE AND HAZELTON RAILROAD COMPANY, A BODY CORPORATE, DEFENDANT.
Argued March 1, 1024
Decided May 7, 1024.
.Before Justices Minturn and Lloyd.
Pot the plaintiff, Edwin S. Dickerson, D. Trueman Stack-house.
Por the plaintiff, William L. Allen, TsIcDermott, Dnright & O arpen ter.
Pot the defendants, Eaizenbach & Hunt. ■

Opinion:
The opinion, of the court was delivered by
Lloyd, J.
These two> cases were submitted together and involve the same question, viz., the legal sufficiency of the plea of the statute of limitations. Both, plaintiffs, a,re holders of detached coupons formerly annexed to bonds issued by the defendant. The coupons were all due and payable more than six years before the present suits were commenced and are in form, except as to number, as, follows:
"WILKESBARKE AND HAZELTON
RAILROAD COMPANY On the 15th day of
May, 1915 ($25)
Will pay to bearer at the' office of Guaranty Trust Company of New York, in the city of New York, N. Y., TWENTY FIVE DOLLARS, United States Gold Coin of the Standard existing May fifteenth, 1901.
Without deductions for taxes being six months' interest then due on its five per cent, gold bond No. 757.
($25) N. C. Yost, (28)
Treasurer."
The statute of limitations being pleaded it is contended by the defendants that the right of action accruing more than six years, before suit the plaintiff is. barred from recovery.
The coupon is a simple contract wherein the defendant, by its treasurer, promises to pay a certain sum of money at a certain time and place therein named. Tf it stood alone and wildly disconnected from any other obligation the holder would, by virtue of the statute of limitations, be obliged to commence his action within the statutory period of six years. Tt is contended, however, that the provision of the statute applicable to bends, applies, and that the limitation is sixteen years, because of the fact that .the coupon was, when executed, attached to a bond under seal. The relation of the coupon to a negotiable bond has been a fruitful source of consideration in the courts. The general trend of authority has been to hold that the detached coupon, when negotiable in form, is free from the conditions and limitations contained in the bond itself. 9 dorp. Jur. 50. And in this state that they form a distinct, and independent con tract. Jones Co. v. Guttenberg, 66 N. J. L. 666; Mack v. American Tel. Co., 79 Id. 109, and finally in a case arising upon a coupon of this same issue of bonds- (Fidelity Trust Co. v. Wilkesbarre and Hazelton Railway Co., 98 Id. 507), the Court of Errors and Appeals declared it to be a "separate and distinct indebtedness in the hands of a bona fide holder, and may be sued on regardless of the mortgage provision concerning the payment of the mortgage indebtedness." In that case the defendant sought the protection afforded the company by the bond itself in which it was provided that suit could only be maintained by the trustee. The defense was held to be unavailable because of the independent status of the detached coupon. In this it must be observed that the independent status of the coupon is based not upon the construction of the bond nor upon the intentions of the parties resulting from such construction, but upon the absolute divorcement of the contract. If, therefore, the detached coupon constitutes in the hands of the holder a distinct and independent contract, represents- a distinct and independent indebtedness, is free from the restrictions and limitations contained in the bond to which it was attached, it would bo both illogical and unjus-t to attach to the coupon for the benefit of the holder the protection of the seal of the bond when considering the application of the statute o-f limitations, while denying to the- maker the advantage- o-f its protective features. No amount of discussion can make the proposition clearer than the plain statement. The plaintilf must come under the pro-visions of the bond in their entirety or be free fro-m them all. The- court of last resort has placed him in the latter class; the coupon stands by itself, is a simple contract obligation of the defendant to- pay, and to it the statutory limitation of six years applies.
The motion to strike o-ut the answer must be denied in both cases.