Court Opinion

ID: 5209490
Source: CourtListenerOpinion
Date Created: 2022-01-06 16:09:26.483066+00
Date Added: 2024-06-11T08:27:20.880965
License: Public Domain

Spring, J. (concurring):
It does not seem to me to be necessary to determine in this case whether the investments made by the county treasurer were unauthorized because of the failure to obtain an order of the court directing such investments to be made.
As to the investment in the bond and mortgage for the Smith infants, made by County Treasurer Sackett, the proof shows that these infants were paid the full amount invested by the treasurer, so that their interest in the investment terminated, and this conclusion does not depend in any way upon the legality or illegality of the original investment.
The investment for the benefit of the infant Charles Bupp, also made without an order of the court, was in a mortgage given by Herman Gruner, accompanied by the bond of the mortgagor. This mortgage was for about $1,900, and an assignment of that mortgage was taken by the county treasurer, $1,000 of it for the benefit of the infant Bupp and $900 for other infants. The mortgage at the time it came into the possession of County Treasurer Sackett covered five acres of land and contained a somewhat ambiguous clause in regard to releases which might be made, and Gruner, the mortgagor, was insolvent and judgments were entered against him at the time of the assignment of the bond and mortgage to the treasurer. The *742land was unimproved and was on the corner of Delevan and Hagen streets, the long frontage being on the latter street, which was merely on paper, and there were no surface indications of the existence of any street or highway. The court has found that these lands “ liad no certain or fixed value and lands and premises in that locality were at that time being bought and sold for speculative purposes only. That on a conservative valuation said lands and premises were worth not to exceed $650 per acre and were not such security as is commonly approved and taken by savings banks, trust companies and persons and institutions having moneys to loan upon real .estate for investment. That the said lands and premises were not proper security for the investment of the funds of infants, or lunatics, or other trust funds.”
I think the proof sustains this finding of the court. This was not the kind of real estate which should be the basis of investment of infants’ funds. It was of fluctuating value, without any buildings and not usable for any profitable purpose. The security which is suitable for investments of this kind is upon real estate of stable value, cultivated and upon which are buildings so that there is a fair indication that there will be no material depreciation in its value. This investment was made by Sackett when this property and adjacent property had an inflated value which affected for several years vacant property in and near the city of Buffalo. The old Chancery rule (180), the rules of court and the Code provisions have for many years required that investments of infants’ funds in mortgages covering lands made by the county treasurer should be upon lands which are unincumbered and worth at least twice the amount of the money loaned, exclusive of the buildings. There was no compliance by the county treasurer with this salutary rule.
For these reasons I concur in the result reached by the presiding justice.
Kruse, J., concurred.
Judgment modified so as to provide for the recovery by the plaintiff of the sum of $1,569.10 only, with interest on $1,000 thereof from October 30, 1907, in all $1,572.10, besides the costs of foreclosure of the Rupp mortgage, and as so modified affirmed, without costs of this appeal to either party.