text:
    Wendell Gruber, Respondent, v. Wilbur F. Wilson, Defendant, and Franklin Wilson, Appellant.
    Submitted October 22, 1937;
    decided November 23, 1937.

      Sol Rubin for appellant.
    The City Court of Yonkers never obtained jurisdiction over the person of the defendant-appellant. (Skyer v. Williamson, 155 Misc. Rep. 18; Bischoff v. Schnepp, 139 Misc. Rep. 293; Heihs v. Reinberg, 136 Misc. Rep. 815; Osterhoudt v. Horowitz, 135 Misc. Rep. 744; Tannenbaum v. Wehrle, 133 Misc. Rep. 577; American Historical Society v. Glenn, 248 N. Y. 445.) Chapter 470 of the Laws of 1937 is not applicable. (Kurland v. Chernobil, 260 N. Y. 254; Continental Casualty Co. v. Nelson, 147 Misc. Rep. 821; Berkowitz v. Dunphy, 141 Misc. Rep. 561; Salzman v. Attrean, 142 Misc. Rep. 245; Heihs v. Reinberg, 136 Misc. Rep. 815.)

      Joseph J. Ferone for respondent.
    Chapter 490 of the Laws of 1937 is controlling to sustain jurisdiction in the City Court of Yonkers. (Lazarus v. Metropolitan El. R. Co., 145 N. Y. 581; Laird v. Carton, 196 N. Y. 169; People v. Green, 201 N. Y. 172; Jacobus v. Colgate, 217 N. Y. 235; Robinson v. Robins Dry Dock & Repair Co. 238 N. Y. 271; Kugel v. Telsey, 250 App. Div. 638; People v. City of Syracuse, 128 App. Div. 702.) The City Court of Yonkers acquired jurisdiction over the defendant-appellant, a non-resident of the State, upon compliance with section 52 of the Vehicle and Traffic Law (Cons. Laws, ch. 71) as it read prior to the enactment of chapter 490 of the Laws of 1937. (Shushereba v. Ames, 255 N. Y. 490; Marcus v. Day, 139 Misc. Rep. 283) Recktenwalt v. Donovan, 161 Misc. Rep. 109.)
   Crane, Ch. J.

The plaintiff, a resident of the city of Yonkers, brought suit in the City Court of Yonkers against the defendants, Wilbur F. Wilson and Franklin Wilson, to recover for damage to his automobile, which he alleges was caused by the defendant Franklin Wilson in operating another car. Both of the Wilsons were residents of Connecticut. Wilbur F. Wilson was not served, but Franklin Wilson, the operator of the car causing damage, was served, pursuant to section 52 of the Vehicle and Traffic Law (Cons. Laws, ch. 71); that is, a copy of the summons and complaint was left with the Secretary of State at the State Capitol Building, Albany, N. Y., and personal service of the summons and complaint was made upon Franklin Wilson by the sheriff of Middlesex county, State of Connecticut, at Middlesex, Connecticut. The action went by default and a judgment of $739.82 was entered up against Franklin Wilson who subsequently moved in the City Court of Yonkers to open the default and dismiss the complaint for want of jurisdiction. The motion was granted, but reversed by the Appellate Division, that court, pursuant to section 589, subdivision 1, of the Civil Practice Act, certifying that in its opinion a question of law is involved which ought to be reviewed by the Court of Appeals. The jurisdiction of the City Court of Yonkers over the defendant is the question which needs attention.

By article VI, section 18, of the Constitution of the State of New York, the jurisdiction of local courts is limited in the following words: “ The Legislature shall not hereafter confer upon any inferior or local court of its creation, any equity jurisdiction or any greater jurisdiction in other respects than is conferred upon County Courts by or under this article; but it may provide that the territorial jurisdiction in civil'cases of any inferior or local court now existing or hereafter established in any city or of justices of the peace in cities shall extend throughout the county or counties in which such city may be located.”

By article VI, section 11, the jurisdiction of County Courts is thus stated: County Courts in counties outside the city of New York shall have the powers and jurisdiction now prescribed by law, and also original jurisdiction in actions for the recovery of money only, where all the defendants reside in the county and in which the complaint demands judgment for a sum not exceeding three thousand dollars; * * *. The Legislature may hereafter enlarge or restrict the jurisdiction of the County Courts provided, however, that then jurisdiction shall not be so extended as to authorize an action therein for the recovery of money only * * * (2) in which any person not a resident of the county is a defendant, unless such defendant have an office for the transaction of business within the county and the cause of action arose therein.”

In American Historical Society v. Glenn (248 N. Y. 445, 448) this court held that section 27 of the New York City Court Act (L. 1926, ch. 539), in so far as it provides that all process and mandates of the court may be executed in any part of the State,” is unconstitutional and void. By the Constitution the City Court of New York is to exercise generally the same functions in the city of New York as did the County Courts outside the city. (State Const, art. VI, § 15.) If the Vehicle and Traffic Law, section 52, attempts to confer upon the City Court of Yonkers jurisdiction over non-residents through process served upon the Secretary of State outside the county, its constitutionality may be seriously doubted. By chapter 852 of the Laws of 1930 the City Court of Yonkers has jurisdiction over the defendants who are residents of the county of Westchester and non-residents who have an office within the county, the cause of action arising therein. Either the plaintiff or the defendant must be a resident of the city of Yonkers. The process and other mandates of the court may be sent to any part of the county of Westchester. (§ 3.) The process in this case was served upon the Secretary of State in the county of Albany. We may, however, pass the constitutional question for the present.

Prior to the amendments of 1937 it had been held that where the Secretary of State had a branch office within the geographical jurisdiction of the local court, service upon the Secretary of State, by leaving the process at that office, gave jurisdiction to the court. (Salzman v. Attrean, 142 Misc. Rep. 245.) Much doubt and some criticism developed, with the result that the Judicial Council attempted to clarify the situation by an amendment which it recommended to the Legislature and which became chapter 94 of the Laws of 1937. The amendment added the words permitting service “ at his office in the city of Albany, or by personally delivering a copy thereof to one of his regularly established offices, with a fee of two dollars,” and some other changes not now material. The Third Annual Report and Studies of the Judicial Council for the year 1937, at page 202, contains a full statement of the purpose of this amendment and a collection of all the cases upon the point. The report states: “ In the case of suits brought in courts of limited territorial jurisdiction in New York city and Buffalo, it would seem advisable in view of possible Constitutional difficulties that service upon the Secretary of State should be made within the territorial jurisdiction of the local courts concerned. The Council recommended last year that section 52 be amended to clarify the permissibility of such procedure. * * * The proposal however is still in order so that the law of the cases may be codified.

Most of the cases have, assumed that service can at present be made on the New York city office or the Buffalo office of the Secretary of State, so as to give the local courts in question jurisdiction. * * * It is desirable to clarify the statute in this respect, because some authority exists for the view that the statute contemplates only service on the Albany office. * * * The Council has also considered the question of making the remedy provided by the above sections more readily available to persons with smaller claims by allowing them to invoke the aid of such tribunals as county courts and local courts in cities where the Secretary of State does not maintain a branch office. The Council, however, has deferred action on this proposal, pending a more comprehensive study of the work of the courts throughout the entire State.”

It is quite evident that the amendment of section 52 by chapter 94 of the Laws of 1937 was intended merely to clarify and make uniform the practice in view of conflicting decisions enabling the local courts to take jurisdiction of these non-resident cases where the Secretary of State had a local branch office within the territorial jurisdiction of the local court. This amendment, however, did not change the law as it was understood to be that a local court like that of the City Court of Yonkers had no jurisdiction over a non-resident who had been served by delivery of the process to the Secretary of State in Albany. So much for section 52, as amended by chapter 94 of the Laws of 1937.

This, however, was not the only amendment made this year. Chapter 490 of the Laws of 1937, not sponsored by the Judicial Council, made an additional amendment to that portion of section 52 reading: And such operation shall be deemed a signification of his agreement that any such summons against him which is so served shall be of the same legal force and validity as if served on him personally within the State,” by adding the following words, “ and within the territorial jurisdiction of the court from which the summons issues.” Should this additional clause mean that one operating a car in Westchester county impliedly gives consent to the jurisdiction over him of the City Court of Yonkers, it is inapplicable to this case, as the statute is not retroactive. Such was our decision in Kurland v. Chernobil (260 N. Y. 254), regarding section 52-a of the Vehicle and Traffic Law, and the same reasoning applies to these amendments to section 52.

The constitutionality of this chapter 490 of the Laws of 1937, as before stated, we shall not consider at this time.

While sections 1472 and 1473 of the Civil Practice Act limit the costs recoverable in actions brought in the Supreme Court where the recovery is under fifty dollars, yet these provisions do not give the defendant costs in a case where the action cannot for jurisdictional reasons be brought in any other court. (§§ 1474 and 1475.)

Our conclusion is that section 52, prior to 1937, did not apply to service upon the Secretary of State made without the territorial jurisdiction of a local court, and that the amendment by chapter 490 of the Laws of 1937, even if constitutional, is not retroactive to cover this case.

For reasons here stated the judgment of the Appellate Division should be reversed and the order of the City Court of Yonkers affirmed, with costs in this court and in the Appellate Division.

O’Brien, Hubbs, Loughran, Finch and Rippey, JJ., concur, Lehman, J., taking no part.

Judgment accordingly.


source: Caselaw Access Project

author: Finch, J.

license: Public Domain

text:
    The People of the State of New York, Respondent, v. John Keough, Appellant.

      Argued October 8, 1937;
    decided November 23, 1937.

      Maurice Edelbaum, Joseph I. Weissman, Harry G. Anderson and Benjamin Schifter for. appellant.
    It was reversible error for the trial court to receive the testimony of the People’s experts inasmuch as the same was based upon facts which were not proved upon the trial. (People v. Hawkins, 109 N. Y. 408; People v. Strait, 148 N. Y. 566; Cobb v. United Engineering Co., 191 N. Y. 475; People v. Hill, 195 N. Y. 16; 2 Wharton’s Crim. Ev. [11th ed.] § 993; United States v. Faulkner, 35 Fed. Rep. 730; Davis v. State, 96 Ark. 7; Flanagan v. State, 106 Ga. 109; Brown v.Ins. Co., 65 Mich. 315; State v. Peel, 23 Mont. 358; Bullock v. New York Life Ins. Co., 182 Minn. 192.) It was reversible error for the trial court to refuse to permit the defendant to show the facts upon which the People’s experts based their testimony. (People v. Faber, 199 N. Y. 256; People v. Youngs, 151 N. Y. 210.)

      William F. X. Qeoghan, District Attorney {Henry J. Walsh of counsel), for • respondent.
    The testimony of the People’s alienists was properly received in evidence. (People v. Hawkins, 109 N. Y. 408; People v. Strait, 148 N. Y. 566; People v. Faber, 199 N. Y. 256; People v. Youngs, 151 N. Y. 210; People v. Taylor, 138 N. Y. 398; People v. Hoch, 150 N. Y. 291; People v. Ferraro, 161 N. Y. 365; People v. Farmer, 194 N. Y. 251; Brotherton v. People, 75 N. Y. 159; People v. Spencer, 179 N. Y. 408; People v. Taylor, 138 N. Y. 398.)
   Finch, J.

This is an appeal from a conviction of murder in the first degree. The defendant, another man, and two women entered a “ speakeasy ” operated by the deceased James Heaney at eleven-thirty p. m. on June 18, 1932. They remained there for several hours partaking of. drinks. At about one A. M. the defendant and one of the women left the table and went to the bar. Heaney refused to allow the woman to drink at the bar, and she returned tc the table. Heaney then went over and spoke to her, and while he was speaking the defendant returned to the table and spat in the woman’s face and threw her pocketbook at her. Heaney protested against conduct of this kind. Shortly thereafter the defendant and the other man left the “ speakeasy;” five minutes later the two women left. About fifteen minutes later the defendant, accompanied by three other men, returned, the defendant and one of the men known as Sam ” carrying guns. The defendant asked for Heaney. Upon learning that the defendant was present with a gun in hand, Heaney and Stewart, a waiter, ran toward the stairway, but when they saw the man called Sam, armed, at the head of the stairway, they ran into the women’s lavatory and closed the door. The defendant called on Heaney, in vile language, to emerge. He attempted to force his way into the lavatory, but Stewart and Heaney leaned against the door, preventing his entrance. Finally he threatened to shoot through the door if Heaney did not come out, and after a lapse of a minute or two a shot was fired through the door, killing Heaney. Stewart was then pulled out of the lavatory by the defendant, who still had the gun in his hand which, according to Stewart, was still smoking. Nobody else was near the lavatory door. A few minutes later the defendant and Sam ran down the stairs into the street and disappeared. What happened to the other men does not appear in this record.

The defendant was not captured until a year later. At that time a lunacy commission, consisting of two laymen and Dr. Jules M. Nova, was appointed, which reported that the defendant was insane at the time of their examination, but was sane at the time of the commission of the crime. Notwithstanding this report of the commission, a trial was commenced, but after the second day another lunacy commission, consisting of three alienists, including Dr. David Corcoran, was appointed, which also reported that the defendant was insane, and he was committed to a State hospital for the insane. He was confined therein for three years, when a writ ■ of habeas corpus was sued out, but the writ was dismissed when the hospital authorities reported that he was not entirely cured. In June, 1936, the defendant was discharged by the hospital as cured, and returned to stand trial.

The main defense relied on at the trial was that the defendant was insane at the time of the commission of the crime. There was evidence that when the defendant was sixteen years old he was indicted as an accomplice in a felony murder, but was permitted to plead guilty of manslaughter in the first degree, and was given a sentence of from ten to twenty years. After serving five years he was transferred on the recommendation of a physician from Sing Sing to Dannemora. Just why this transfer was made does not appear, although counsel states that he became mentally deranged. Various members of his family testified to irrational acts of the defendant after he returned from prison, but they admitted that at the time they thought he acted strangely but did not believe him insane.

Dr. Nova, of the first lunacy commission, and Dr. Corcoran, of the second lunacy commission, testified, over the objections of counsel for the defendant, that, in their opinion, based upon personal observation of the defendant and upon testimony of his mother and sister before the lunacy commissions, the defendant was sane at the time of the commission of the crime, although he was insane at the time they examined him,. The admission of this evidence based upon statements of third parties constituted material error requiring a reversal and a "new trial.

Experts called to testify concerning the sanity of the defendant in a criminal case are limited to opinion based upon proper hypothetical questions, and opinion based upon personal observation and examination of the defendant. (People v. Lake, 12 N. Y. 358.) Opinions based in whole or in part upon statements other than those of the person whose sanity is in question related to the expert, as in the case at bar, are not admissible. (People v. Hawkins, 109 N. Y. 408; People v. Strait, 148 N. Y. 566; People v. Hill, 195 N. Y. 16, 19; Smoot on the Law of Insanity, § 570; 2 Wharton’s Grim. Evidence [11th ed.], § 993.) The basis of this rule is to be found in the following sentence from People v. Strait (supra), wherein the court says: “ The witness was an expert on the diseases of the mind, but he was not an expert on determining the facts, where such facts had to be obtained from the statements of others” (p. 570). The ultimate decision as to the sanity or insanity of the defendant rests with the jury, and in general must be based upon facts presented before it and not opinions. An exception, however, is made in the case of experts because The opinion of the witness may be based upon facts so exclusively within the domain of scientific or professional knowledge that their significance or force cannot be perceived by the jury, and it is because the facts are of such character that they cannot be weighed or understood by the jury that the witness is permitted to give an opinion as to what they do or do not indicate.” (People v. Youngs, 151 N. Y. 210; 218.) Even where the opinion of the expert is based upon personal examination, he may be required to state the circumstances of his examination and the facts, symptoms or indications upon which his conclusion is based, before giving his opinion to the jury; or this information may be elicited on cross-examination. Where his opinion, however, is based upon the statements of third persons not in the presence of the jury, the latter not only is in ignorance of what these statements contain, but also has no opportunity to pass on the truth and probative force of the statements or to determine whether the statements were not concocted to produce a desired result. For this reason it is not permissible to ask an expert for an opinion based upon all the testimony in the whole case, since this would involve passing upon the credibility of witnesses and drawing inferences from their statements. (People v. McElvaine, 121 N. Y. 250.) The rule limiting opinions of experts aside from hypothetical questions, to those based solely on observation and an examination of the defendant, was violated in the case at bar. (People v. Hill, 195 N. Y. 16, 19.) Dr. Nova testified as follows:

“ Q. On what did you base your finding that he was sane at the time of the commission of the crime, if no eyewitness testified before your commission as to what happened on that night?
A. A history of the actions, reactions, conduct, language of the individual, from the mother and the sister, from the time as far back as they could remember up to the present time, or the time that we had examined him — examined them, rather * * *
Q. Now, did you take into consideration the testimony of the mother and the sister when you found that he was sane at the time of the commission of the crime?
“ A. Yes.”

Dr. Corcoran, who sat on the lunacy commission which heard ten witnesses, including the father as well as the mother and sister of the defendant, testified as follows:

“ Q. Doctor, from your experience, are you able to express an opinion from the hearings that you held on this commission and the witnesses that you examined, including the defendant, are you able to express an opinion as to whether or not the defendant, in your opinion, was sane or insane on the 19th of June, 1932?
" A. I am.”

The error was not cured even though both the mother and the sister testified at the trial. The sister did not testify fully, and, moreover, on cross-examination counsel for the defendant was not permitted to interrogate one of the experts with respect to the nature of the testimony of the mother and the sister upon which his opinion was based. An attempt by counsel for defendant to place in evidence a transcript of the testimony taken before the lunacy commissions also was unsuccessful. Thus the jury, although informed that the experts relied upon statements of fact by the mother and the sister and others, who appeared before the lunacy commission, never were apprised of the nature of these statements upon which the expert relied in reaching the conclusion that the defendant was sane at the time of the commission of the crime. Thus the defense, kept in ignorance of' which statements were relied upon, never had a proper opportunity to cross-examine the witnesses. Of the committing of the shooting by the defendant no doubt remains. Whether the defendant was sane or insane at the time presents the close issue in the case. Upon this issue the error complained of was material and vital.

Since this error requires reversal and a new trial, it becomes unnecessary for us to consider the other alleged errors raised by the brief of the defendant.

The judgment of conviction should be reversed and a new trial ordered.

Crane, Ch. J., Lehman, O’Brien, Hubbs, Loughran and Rippey, JJ., concur.

Judgment of conviction reversed, etc.


author: Crane, Ch. J. Lehman, J.

text:
    In the Matter of Sydney R. Snitkin et al., Appellants, against Frank J. Taylor, as Comptroller of the City of New York, Respondent.
    Submitted October 4, 1937;
    decided November 23, 1937.

      Sydney R. Snitkin, Francis J. McCaffrey, Jr., Frederick J. Groehl, in person, and Jerome H. Adler, Howard J. Gibbs and Julius Blum for appellants.
    The jurisdictional facts requisite to the granting of counsel fees exist herein; the orders having been duly entered, the issue of the amount of compensation is res judicata and not subject to collateral attack by the Comptroller. (People v. McElvaney, 36 Misc. Rep. 316; Blake & Johnson v. Lyon & Fellows Mfg. Co., 77 N. Y. 626; Knickerbocker Trust Co. v. O., C. & R. S. Ry. Co., 201 N. Y. 379.) The Court of General Sessions is the sole auditing body for counsel fees and disbursements in capital cases; the Comptroller is a mere disbursing agent and has no power to ignore the court orders. (Wormser v. Brown, 149 N. Y. 163; People ex rel. O'Loughlin v. Prendergast, 219 N. Y. 377; People ex rel. Benedict v. Supervisors, 24 Hun, 413; People ex rel. Ryan v. Ocean, 5 Daly, 254; People ex rel. Brown v. Board of Apportionment, 52 N. Y. 224; People ex rel. Hamilton v. Supervisors, 35 App. Div. 239; City of Syracuse v. Roscoe, 66 Misc. Rep. 317; People ex rel. Baldwin v. Board of Supervisors, 12 How. 204; 26 Barb. 118; Matter of Wilaka Construction Co. v. McAneny, 265 N. Y. 43; Matter of Rector, etc., Trinity Church v. Berry, 223 App. Div. 742 ; 248 N. Y. 564; Matter of Brennan v. Board of Education, 245 N. Y. 8; Matter of Graybar Construction Co. v. Berry, 264 N. Y. 432.)

      Paul Windels, Corporation Counsel (Robert C. Rand and Thomas W. A. Crowe of counsel), for respondent.
    In refusing to comply with both orders the Comptroller has chosen his proper and his only remedy. (People ex rel. Van Doren v. Prendergast, 214 N. Y. 16; People

      ex.rel. Perry v. Berry, 250 N. Y. 452; People v. Simpson, 121 App. Div. 402; People v. Heiselbetz, 30 App. Div. 199.)
   Crane, Ch. J.

One Billy Tarver, on the 29th day of April, 1936, was indicted for murder in the first degree. Two indictments were found against him: one, numbered 208734, for having killed one Trozzo; another, numbered 208735, for having killed one Holloway. It appears that the crime was committed in a saloon fight in the city of New York, borough of Manhattan, in which the defendant and his brother caused the death of the two victims named. It was one occurrence. Billy Tarver, being without funds, the Court of General Sessions assigned him three counsel, petitioners herein. Thereafter Billy Tarver, on the 16th day of June, 1936, pleaded guilty to manslaughter under indictment 208734, and was sentenced on the 26th day of June, 1936, for a term of from six to twelve years in a State prison. This ended indictment 208734, and the charge of murder in the first degree ” thereunder, for having killed Trozzo.

Thereupon the Court of General Sessions made two orders, apparently under section 308 of the Code of Criminal Procedure, allowing counsel $1,000 for their services in the case known as indictment for murder in the first degree, No. 208734, in which the plea of manslaughter had been taken for the killing of Trozzo. The court also made another order giving the same counsel $1,000 for services in indictment 208735, in which the charge was murder in the first degree for killing Holloway, although there is no proof to show that this indictment has been disposed of in any way known to the law.

Under section 308 of the Code of Criminal Procedure the court is without power to make any allowance until the defendant has been tried or the action or indictment is otherwise disposed of. The proceeding or action must be terminated, at an end, and in a way which is legal and recognized by law. Any agreement or statement of the court or District Attorney that the defendant will not be prosecuted thereafter is insufficient. A criminal action is terminated by a verdict of not guilty, by a conviction or a plea of guilty and judgment entered thereon, or else by an order of the court dismissing the indictment. So long as the indictment is outstanding, undisposed of by a formal order of the court, there is no jurisdiction or power to make counsel an allowance. There is nothing in the papers in this record to show that indictment No. 208735, the Holloway indictment, has ever been dismissed.

The petition in this case asking for allowances simply states that on June 16, 1936, the defendant pleaded guilty (one plea) to the crime of manslaughter. The recital in the judge’s order making the allowance is: “ The defendant pleaded guilty to indictment No. 208734, Calendar No. 73416, to the crime of manslaughter in the first degree, to cover also Indictment No. 208735, Calendar No. 73415.” What this means I do not know. No such language is used or justified by the Code of Criminal Procedure. Does this mean that the defendant also pleaded guilty to manslaughter in the first degree for having killed Holloway? Certainly not, because it is conceded that he only entered one plea of manslaughter and was sentenced on only one plea of manslaughter, and that for having killed Trozzo. This language which I have quoted apparently means that, having pleaded guilty to one indictment, the District Attorney would not prosecute the other; that the plea in the one case was sufficient. But this did not dispose legally of indictment 208735 which, so far as this record shows, has never been dismissed. We have not the indictment before us, but there is not one statement in the record that the plea on that indictment has been “ guilty of manslaughter in the first degree,” or of any sentence imposed by the court; neither is there any statement that that indictment has been dismissed. Until these facts appear the Court of General Sessions had no power or jurisdiction to make any allowance for the disposition of indictment No. 208735, the Holloway indictment.

All the parties apparently have treated the fracas or the saloon row, which resulted in the killing of Trozzo and Holloway, as one crime, and the plea to one indictment as being sufficient punishment for the one crime. Should the District Attorney or his successor move for trial the indictment 208735 (Holloway) no doubt the trial would be stayed, or the promise of the District Attorney not to prosecute enforced, by reason of the plea to indictment 208734. The Court of General Sessions would probably be justified in then dismissing indictment 208735; but, until this be done, the court is without power to make any allowance in the case of No. 208735.

We have heretofore recognized the right of the Comptroller to reject these claims for counsel fee and expenses in criminal cases when they were not justified by statute. (People ex rel. Van Doren v. Prendergast, 214 N. Y. 16; People ex rel. Perry v. Berry, 250 N. Y. 452; Matter of Reilly v. Berry, 250 N. Y. 456.)

There is another reason why this allowance in indictment 208735 was illegal on its face. The crime committed by Billy Tarver was perpetrated at the same place, in the same room and at the same time and on the same date, in the same fracas, and resulted in the death of the two men, Trozzo and Holloway. Two indictments were found simply because there were two dead men. These petitioners were assigned to defend Billy Tarver. The cases were treated as one, for it appears in the record that a plea of guilty to manslaughter in the first degree was taken on indictment 208734, the Trozzo indictment, to cover also indictment No. 208735.” The defendant was sentenced as for one crime only, and the plea was taken in but one case and the services, so far as this record shows, were rendered only in the one case.

Section 308 of the Code of Criminal Procedure was intended to protect the treasury of the city, and, therefore, placed a limit upon the amount which might be given to a lawyer for defending a murder case. The limit was $1,000, and yet in this instance the court below has attempted to make it $2,000 for the services rendered in one case, namely, the Trozzo case. There were no services rendered in the Hollaway case, indictment 208735, except as they were identically the same acts and services performed in the Trozzo case. The petitioners have apparently been allowed $2,000 for the same services, the same acts, when the limit is $1,000. This is a mere gift of the city’s money, unauthorized by law, even contrary to the Constitution of the State of New York.

The statute itself has not remained unchallenged upon constitutional grounds. (People ex rel. Acritelli v. Grout, 87 App. Div. 193; affd., 177 N. Y. 587.) In People v. Heiselbets (30 App. Div. 199) the court attempted to make a full allowance to each of two assigned counsel. This was held to be illegal and beyond the power of the court. It may be noted that both Judge Bartlett and Judge Cullen were members of the Appellate Division in this case. Judge Cullen there said: “I agree with Mr. Justice Bartlett, that there is no authority for an appeal to this division from the certificate of the justice presiding at the trial awarding compensation to counsel. If the award is in excess of the amount allowed by law, the comptroller should refuse payment and resist any proceedings taken to enforce it.” The Comptroller has made such resistance in this case. While the facts are not the same in the Heiselbets case as in the present one before us, the principle to be applied is the same, for in this case counsel are to be paid in full twice for the same identical services. Whereas the statute limits the amount to $1,000, they have been given $2,000. The lack of power and jurisdiction in the court to make this second order in indictment 208735 is clear and appears from the mere recital of the facts as taken from the record. The judge by an order in' indictment 208734 made a full allowance to counsel of $1,000 for all the services rendered upon the plea of guilty. He had no power to give an additional $1,000 in the other indictment for apparently the same services.

I, therefore, hold:

First. That the court was without jurisdiction to make the allowance in indictment 208735, as it nowhere appears in the record that the indictment has been disposed of in any way known to the law, that is, by a judgment or a dismissal of the indictment.
Second. That the court had no jurisdiction to allow $2,000 for the same services.
The order should be affirmed, without costs.

Lehman, J.

(dissenting). On April 29, 1936, the grand jury found two indictments against one Billy Tarver. Indictment numbered 208734 charged the accused with the crime of murder in the first degree for the killing of Achille Trozzo. Indictment number 208735 charged him with murder in the first degree for the killing of Paul Holloway. On May 4, 1936, two orders were made assigning the three petitioners as counsel to defend the accused upon these charges. Each order refers to the crime charged in a separate indictment which is properly identified by number. The orders recite the facts which must be shown in order to invoke the jurisdiction of the court to assign counsel, and the validity of these orders is not challenged. On May 16,1936, the accused pleaded guilty to manslaughter in the first degree and was sentenced to a State prison. Then the petitioners were entitled to “ reasonable compensation ” not exceeding the sum of $1,000 for their services in connection with the charge made in either or both indictments, disposed of ” by the plea and sentence of the accused. (Code Crim. Proc. § 308.)

By separate orders each bearing the number of one of the indictments, the court allowed to counsel the sum of $1,000 upon each charge and directed the Comptroller to pay to each of the petitioners one-third of the sums so allowed. The Comptroller, upon the advice of the Corporation Counsel, paid $1,000 and refused to pay the other $1,000 which he had been directed to pay. Then the petitioners moved for an order of peremptory mandamus to compel such payment.

To justify the Comptroller’s refusal to pay in full the sums allowed by the orders signed by a judge of the Court of General Sessions, the Corporation Counsel asserts, in an affidavit submitted in behalf of the Comptroller, that “ under the facts and the law the petitioners herein are entitled to one aggregate counsel fee of $1,000, payment of which has already been made to them, for the following reasons.” These reasons may be summarized as follows: The crimes charged were committed in the same place, at the same time, on the same date and were part of the same affray. The work of investigating and preparing for trial the charges under either indictment would cover and include the charge under the other indictment. “ The court made a single disposition of the two indictments returned against each of the two brothers — a plea of guilty to the lesser crime of manslaughter in the first degree being accepted 1 to cover ’ both murder indictments returned against each of the two brothers; the sentence imposed covered the two indictments.” For these reasons it is said that “ first degree murder indictments ” should never have been returned and that “the court was without power under the circumstances to award compensation to assigned counsel on a per indictment ’ basis, i. e., $1,000 for each indictment returned against each of the two brothers, or the total sum of $4,000 to be paid by the City.”

In a memorandum stating: “ Payment to the petitioners of $1,000 was ample compensation for the services rendered. There was no trial or trials, and the plea of guilty disposed of both indictments ” (250 App. Div. 581), the Appellate Division reversed a peremptory order of mandamus granted at Special Term. If the Appellate Division has power in this proceeding to review the order made in the Court of General Sessions fixing the compensation of the petitioners at $1,000 for services rendered upon each assignment, then the order of the Appellate Division must be affirmed. A finding that $1,000 was ample compensation for the services rendered by these petitioners would be justified upon the record here presented. Perhaps, indeed, an allowance of $1,000 for services rendered in defense of the accused upon each charge is unreasonable as matter of law under the circumstances here disclosed. The orders are ex parte and it does not appear that by motion to vacate or modify the orders for such allowance the error was ever called to the attention of the judge who signed them and opportunity given to him to correct the error which he may have inadvertently committed. The Comptroller might have requested the Corporation Counsel to take appropriate steps to obtain a modification of the order. The Comptroller did not do so. Instead by advice of the Corporation Counsel he refused to obey the direction to pay contained in one of the orders served upon him, and paid to the petitioners only the amount which he was directed to pay by the other order. In this proceeding the question to be decided by the court is not whether the orders granting the allowances are provident or improvident, in fact or in law. They were not subject to review at Special Term or by the Appellate Division on appeal from the order of Special Term. The question in this proceeding is whether the petitioners have a clear legal right to payment by the Comptroller of the amounts he has been directed to pay to them by the orders of a judge of the Court of General Sessions which have not been challenged directly by any court proceeding.

Of course if the judge who signed these orders acted without jurisdiction, they are mere scraps of paper which the Comptroller was bound to disregard. The jurisdiction of the court or judge to allow to assigned counsel reasonable compensation for services or “ personal and incidental expenses ’’ is statutory. Before compensation for services of counsel can be allowed there must be a valid assignment of counsel. (People ex rel. Van Doren v. Prendergast, 214 N. Y. 16; People ex rel. Perry v. Berry, 250 N. Y. 452.) Before “ personal and incidental expenses ” can be allowed it must appear that the expenses claimed were “ personal and incidental ” within the meaning of the statute. (Matter of Reilly v. Berry, 250 N. Y. 456.) This court in the cases cited has found that when any of the elements upon which jurisdiction depends is lacking, the Comptroller may, indeed must, disregard the order. The Comptroller is not compelled or permitted to pay assigned counsel any compensation unless the court has by order made an allowance of reasonable compensation * * * not exceeding the sum of one thousand dollars,” as authorized by the statute. An allowance which exceeds the limit, like an allowance made without jurisdiction, is invalid. (Cf. People v. Heiselbetz, 30 App. Div. 199.) Within that limit the discretion of a court having jurisdiction is plenary. Abuse of discretion, even though so aggravated that it constitutes an error of law, does not deprive the judge or court of jurisdiction. The Comptroller to whom an order to pay is directed may not ignore the order or decide for himself the amount which would constitute a “ reasonable allowance.” Challenge • of the amount allowed which does not exceed the limits of the court’s jurisdiction must be made in the appropriate court and in appropriate proceedings. The judge at Special Term who granted the peremptory order of mandamus might have directed, or, at least, suggested that challenge of the amount allowed in these improvident orders should be made in the Court of General Sessions and might have adjourned the hearing of the motion for an order of mandamus until that challenge was made and determined; but, as he pointed out, the court at Special Term cannot interfere with the discretion of the other court;” and the Appellate Division upon the appeal from the order of Special Term could review that order but not the order of the other court.”

The question remains whether the Court of General Sessions was, as the Comptroller claimed, without power * * * to award compensation to assigned counsel on a 1 per indictment basis.” The accused was charged with the murder of two men. Though both men were wounded in the same room, on the same day and died as the result of such wounds within the space of two days, yet each homicide was a separate crime. (Penal Law, § 1044.) Separate indictments were found, because an indictment must charge but one crime.” (Code Crim. Proc. § 278.) The accused was arraigned upon both indictments and in accordance with section 308 the court assigned counsel to defend the accused upon each charge. The accused might have been tried upon either charge and if acquitted upon the first trial he might have been tried under the second indictment. (Cf. Hotema v. United States, 186 U. S. 413.)

The statute makes no provision for a single assignment of counsel upon two charges of separate crime in separate indictments and upon which there may be two trials. The two charges are so closely connected that the work of counsel in investigating the facts and preparing for trial on either indictment would necessarily cover in large part the investigation, and preparation for trial of the other charge might dictate the assignment of the same counsel upon both charges. That was done here. Even so, after the work of preparation for trial was finished, there might be two trials. Counsel assigned to defend upon two charges made in two indictments upon which there may be two trials are entitled to reasonable compensation not exceeding $1,000 for services rendered upon each charge when each indictment is disposed of.” That is true whether the same counsel or different counsel are appointed on each charge. The language of the statute cannot be otherwise construed. Indeed no suggestion has been made that the limitation that reasonable compensation to assigned counsel shall not exceed $1,000 applies when counsel have been assigned by separate orders to defend an accused upon two charges where each charge has been tried or where for any other reasons separate services have been rendered upon each charge. The contention made is only that for services rendered in only one case there can be only one allowance of compensation and that allowance is in the amount imposed by the statute.

The difficulty with this contention is that it is not sustained by the record. Each order granting an allowance of $1,000 for services rendered recites that the petitioners rendered “ the services as set forth in the annexed affidavit.” The affidavits are not in the record, but perhaps sufficient has been shown to justify the inference that the same investigation of the facts would substantially cover both charges and that the services rendered were confined to such investigation and to advice, based on that investigation, to plead guilty of manslaughter rather than to risk trial. Where, as in this case, two brothers have been indicted for the homicide of two men in a single affray, the charges against the two brothers are so related that almost inevitably much of the work of investigation could be used for the defense of either accused upon either charge. For all services rendered in defense of both accused upon both charges, counsel is entitled to “ reasonable compensation ” subject only to the limitation that the reasonable compensation may not exceed the sum of $1,000 in the defense of a single accused upon a single charge. In fixing an allowance of “ reasonable compensation ” it would be patent error to duplicate in each case the full value of services rendered but once; none the less where counsel have been assigned to defend an accused upon charges made in two indictments, when both have been disposed of,” allowance for the reasonable value of services rendered under both assignments can be made only by apportioning to each indictment the services rendered, perhaps indiscriminately, upon both indictments. The statute makes no provision for compensation to assigned counsel except on a per indictment ” basis. There may be difficulty in appraising the value of services upon such basis; error there can be corrected only by appeal from the order fixing the services. Where the court has jurisdiction to fix such value its order may not be disregarded if the amount fixed does not exceed the jurisdiction of the court.

All that has been said is based upon the assumption that both indictments have been disposed of ” and that the petitioners were, therefore, entitled to reasonable compensation for services rendered in connection therewith. Though all parties acquiesce in that assumption and though the Appellate Division even in reversing the order of Special Term has said the plea of guilty disposed of both indictments ” (italics are mine), it is said in the opinion of Crane, Ch. J., that only one indictment has been disposed ” of by a single plea of guilty of manslaughter; that the accused has been sentenced under only one indictment though the plea was taken to cover ” both indictments and that the other indictment is still pending. The General Sessions did not so construe its own proceedings, the Appellate Division did not so construe them and the affidavit presented by the respondent expressly states that the sentence imposed covered the two indictments.”

The error in the order of the Court of General Sessions is not jurisdictional and the Comptroller had no legal justification for resisting payment directed by the order. The law provides adequate method of correcting error in a judicial order by direct challenge. Disregard of an erroneous order by a conscientious administrative officer may in a particular case be more convenient and expeditious than challenge in the courts. When the courts sanction such disregard or strain to find jurisdictional error where no such error exists they are not destroying technicalities which interfere with a just result; rather they are destroying the conclusive character of judicial decisions and are rendering determination of the binding effect of judicial orders a question of policy or expediency rather than a question of law.

The order of the Appellate Division and that of the Special Term should be reversed, without costs, and matter remitted to the Special Term to be disposed of as indicated in this opinion.

Finch and Rippey, JJ., concur with Crane, Ch. J.; Hubbs, J., concurs with Crane, Ch. J., on the first ground stated in the opinion; Lehman, J., dissents in opinion in which O’Brien and Loughran, JJ., concur.

Order affirmed.


author: Rippey, J.

text:
    Catherine A. Getman, as Administratrix of the Estate of Mabel E. Getman, Respondent, v. George Niferopulos et al., Defendants, and City of Johnstown et al., Appellants. Fayette E. Moyer, Respondent, v. Blanche Wilson et al., Defendants, and City of Johnstown et al., Appellants.

      Argued October 5,1937;
    decided November 23, 1937.

      Alfred D. Dennison for appellants.
    The Appellate Division erred in holding that penalties and interest were not collectible in addition to the face of the tax. (Laws of 1905, ch. 393, §.§ 96, 101,106, 232, as amd.) The 1925 school tax in the first above-entitled action did not cease to be a lien. (People v. Salter, 191 App. Div. 723; McGaffin v. City of Cohoes, 74 N. Y. 387.)

      Fayette E. Moyer for respondents.
    The officer making a sale in a mortgage foreclosure action can only pay from the proceeds of sale such taxes, assessments and water rates as are liens upon the property sold. (Civ. Prac. Act, § 1087; First Citizens B. & T. Co. v. Rutger Development Co., 144 Misc. Rep. 745; People ex rel. Adirondack Power & Light Corp. v. Durey, 123 Misc. Rep. 111; Matter of N. Y. C. & H. R. R. R. Co., 90 N. Y. 342; City of Rochester v. Farrar, 44 Misc. Rep. 394; Rupert v. Village of North Pelham, 139 App. Div. 302; Lawton v. City of New Rochelle, 114 App. Div. 883; Fulton v. Krull, 200 N. Y. 105; Zink v. McManus, 121 N. Y. 259.) There is no provision in the charter (L. 1905, ch. 393) under which interest may be charged against the delinquent taxpayer unless the officials have taken the steps prescribed. (Matter of New York v. Brooklyn Bridge, 137 N. Y. 95.) There is no hen on land for taxes unless the statutory requirements have been comphed with within the time prescribed. (Matter of Bodine, 74 Misc. Rep. 498; Feldman v. Barshay, 246 N. Y. 130; 246 N. Y. 535.) The city can take but one method of collecting the unpaid taxes each year, and, having elected the method, is confined to that method. If it fails to carry out the directions of the city charter each year it loses its right to proceed in any subsequent year, as no provision is made for reassessing unpaid taxes in any subsequent year. (Matter of Bodine, 74 Misc. Rep. 498; Feldman v. Barshay, 246 N. Y. 130; 246 N. Y. 535; Matter of Morse, 189 App. Div. 803; 190 App. Div. 946; Bennett v. Peck, 112 N. Y. 649; Bennett v. Peck, 28 Hun, 447 ; 95 N. Y. 661; Sharp v. Spear, 4 Hill, 76; Alexander v. Gordon, 101 Fed. Rep. 91.) The city having elected to adopt the tax sale method of collecting, all proceedings must rest on a strictly legal or statutory basis, and it must appear that all essential steps have been taken. (Bennett v. Peck, 112 N. Y. 649; Bennett v. Peck, 28 Hun, 447 ; 95 N. Y. 661; Sharp v. Spear, 4 Hill, 76; Buffalo L., T. & S. D. Co. v. Depew Mfg. Co., 66 Misc. Rep. 630; Rathburn v. Acker, 18 Barb. 393; Matter of Douglass, 46 N. Y. 42; Matter of Pressel v. Ferris, 148 Misc. Rep. 910; Lancaster Sea Beach Imp. Co. v. City of New York, 214 N. Y. 1; Sanders v. Downs, 141 N. Y. 424; People ex rel. National Park Bank v. Metz, 141 App. Div. 600; Clason v. Baldwin, 152 N. Y. 204; Lockwood v. Gehlert, 127 N. Y. 241; Zink v. McManus, 121 N. Y. 259; Fulton v. Krull, 200 N. Y. 105; Burr v. Palmer, 53 App. Div. 358; Matter of Bodine, 74 Misc. Rep. 498.)
   Rippey, J.

The Getman action was commenced for the purpose of foreclosing two mortgages, dated respectively September 8, 1927, and March 13, 1928, upon certain property situate on South Market street in the city of Johnstown. The mortgages in question were executed by George Niferopulos who was at the time the owner of the property and they were delivered by him to the plaintiff. In this action the complaint alleges that the Chamberlain of the city held a tax sale of the property on October 10, 1932, for unpaid city taxes for the years 1928, 1929 and 1930, for unpaid school taxes for the years 1925, 1928 and 1929 and for unpaid State and county taxes for the years 1928 and 1929 at which the city bid in the property for the amount of the taxes as originally spread upon the assessment rolls plus fees and interest and the expenses of sale and that a certificate of sale was on that day issued to the city.

The Moyer action was commenced to foreclose a mortgage upon property situate on Charles street in said city. Niferopulos became the owner of the property on November 13, 1917. The mortgage was executed and delivered by a prior owner on November 12, 1917, to one Lula Smith and by her assigned to the plaintiff by an instrument recorded July 28, 1923. It is alleged in the complaint in that action that the city held a tax sale of the property and bid it in on October 10,1932, for the unpaid city taxes for 1928, 1929 and 1930, unpaid school taxes for 1925, 1927, 1928 and 1929, State and county taxes for 1927, 1928 and 1929 and the sewer assessment and tax for 1927, with accrued fees and interest and the costs of sale, and that a certificate of sale was then issued to the city.

In each action plaintiff alleges that the sale was illegal and void because city officials failed and neglected to take certain steps and proceedings for the collection and reassessment of the several taxes as was required of them by the provisions of the city charter as preliminary and antecedent conditions to a valid sale of the property. It is alleged in the complaint that, for the same reason, the lien of the taxes as originally existing upon the real property had been lost. In each action the city answered and asserted that the taxes were valid liens upon the property, that the sale was a valid sale and that the liens for the taxes were superior to that of the mortgage or mortgages'under foreclosure. The two actions were tried together and upon specific findings of fact and conclusions of law by the trial judge judgments were separately entered directing foreclosure and sale of the real properties involved “ without prejudice as against the defendants, the City of Johnstown and Edward D. O’Neil, as Chamberlain of the City of Johnstown, as to the taxes, interest and charges thereon, as set forth in the complaint, and alleged by the plaintiff to be invalid, pending the decision of this court as to the validity or invalidity of the same.” The judgment further provided that the fund should not be distributed until final determination of the issues in each action between the plaintiff therein and the city “ as to the jurisdiction of the taxes and tax certificates now pending.”

As indicated above, the tax sale in the Moyer case included an assessment and tax for local improvement. The trial court held that that tax and assessment were void because of an error in the assessment. In this the city acquiesced. In consequence the judgment of the trial court was that the tax sale in October, 1932, involving the property on Charles street, was void, but it was held that the hens for the other taxes involved continued as valid hens upon the property. In the Getman case the trial court held that the tax sale was in ah respects vahd and directed the referee on sale and foreclosure to pay the amount appearing on the face of the tax certificate to be due with interest at twelve per cent from the date of sale and the issuance of the certificate. The amount stated in the certificate included fees of two and five per cent and interest on the hens at the rate of seven per cent per annum from December 1, 1931 (the date when reassessment proceedings under section 104 of the charter were commenced). In the Moyer action the trial court allowed the face amount of the tax hens as originally established plus similar fees and interest. The plaintiff in each action appealed to the Appellate Division. The judgment of the trial court was affirmed in each case except (1) as to the item of $147.60 for the 1925 school tax on the Market street property which was held to be uncollectible as a hen on the property in this action because of the provisions of section 105 of the charter which will be later considered, and (2) the city, as matter of law, was precluded from collecting interest, fees and penalties on any of the taxes because it had failed to follow the procedure for collection as outlined in sections 96, 97, 102 and 103 (Laws of 1905, ch. 593), sections 101 and 104 (Laws of 1905, ch. 593, as amd. by Laws of 1916, ch. 326) and section 106 (Laws of 1905, ch..593, as amd. by Laws of 1910, ch. 660) of the city charter. Plaintiffs have not appealed to this court. The city has appealed in each case from so much of the judgments entered on the orders of the Appellate Division as modified or reversed the judgments of the Trial Term. The questions here for decision are (1) whether the 1925 school tax on the Market street property constituted a valid lien thereon at the time of the foreclosure and sale, and (2) whether the liens of the various taxes included interest, fees and penalties, and if so, in what amount and from what dates.

The procedure for the assessment and levy of taxes upon real property situate within the city of Johnstown is authorized and regulated, the designation of the officials and bodies required to act is made and their power and authority to act is established and the time within which the several steps required to be taken is fixed (1) as to State and county taxes by sections 92, 93, 94, 103, 104 and 310 of the city charter (Laws of 1905, ch. 593, as amd. by Laws of 1916, ch. 326) and sections 20-21, inclusive, 24-31, inclusive, and 50-58, inclusive, of the Tax Law (Cons. Laws, ch. 60); (2) as to city taxes by sections 98, 99, 100, 103 and 104 of the city charter (Laws of 1905, ch. 593, as amd. by Laws of 1910, ch. 660, and Laws of 1916, ch. 326), and (3) as to school taxes by section 877, subdivision 2, of the Education Law (Cons. Laws, ch. 16; Laws of 1917, ch. 786, § 1, as amd. by Laws of 1922, ch. 346, § 1), supplemented by the provisions of the city charter above mentioned relating to city taxes. All of the taxes in question were validly assessed. It has been so held in the courts below and plaintiffs are not here to raise any question on that point.

Where any particular unit of government in this State has jurisdiction to impose a tax on real property, the assessment rolls must be prepared and completed and the amount of the tax ascertained and determined as and in the manner prescribed by law and the assessment roll confirmed by the agency charged with the duty of confirming the roll before the assessment or tax can become a charge against or a lien or incumbrance upon the land to which it relates in all cases where the applicable statute is silent as to the time when the lien attaches. (Burr v. Palmer, 53 App. Div. 358; Lathers v. Keogh, 109 N. Y. 583, 589.) The amount which the taxpayer must pay is then fixed and becomes due. The assessor does not spread the tax upon the roll. That is done usually by the confirming agency. Unless otherwise specifically provided, the issuance of the warrant has nothing to do with fixing the lien; the-warrant amounts only to an authority and direction to the proper official to collect the tax finally fixed by the confirmation of the roll; it relates only to the tax-collecting process. The validity and certainty of the lien cannot be impaired by the failure of the confirming agency to issue the warrant for collection. In the case at bar, county and State taxes became hens upon the real property to which they relate upon confirmation of the assessment roll and the spreading of the tax by the board of supervisors of the county of Fulton at the annual meeting in December held during the year in which the assessment roll was made up. (Charter, §§ 92, 93; Tax Law, §§ 58, 59.) City and school taxes became liens upon confirmation of the respective rolls therefor by the Common Council and the delivery of the confirmed rolls to the City Clerk. (Charter, § 99.)

Under the provisions of the charter, if a city tax is not paid prior to September first of the year within which the assessment is made, or a State and county tax is not paid prior to February fifteenth of the year after which the roll is confirmed, the Chamberlain is directed to proceed by distress and sale of the goods and chattels of the taxpayer. Such proceedings were instituted but resulted in failure to collect. Thereafter the city officials were authorized by the provisions of sections 103-105, inclusive, of the charter to institute, on or before December fifteenth of the year following the assessment of the tax and confirmation of the roll, proceedings for a revision of the assessment roll and to carry them forward to the end that the revised roll should be filed with the Clerk of Fulton county on or before the following January fifteenth. In the event such proceedings are taken, section 105 of the charter provided: “A certified copy of such revised assessment-roll shall be filed in the office of the clerk of Fulton county. All taxes and assessments on real property shall cease to be liens thereon, as against subsequent purchasers, mortgagees and the holders of other incumbrances unless such certified copy shall be so filed within one year after the making of the original assessment-roll. Such liens shall cease as against such persons five years after the date of filing such certified copy.”

Whether the attempt to revise was effective or not, we are not called upon to decide. It is obvious that the filing of the revised roll, in any case, could not be made within one year after the making of the original assessment-roll.” We are required to construe that expression to mean within one year after the making of the original revised assessment-roll ” if it is to be given any effect at all. So construed, the end of the period during which the lien of all taxes continued had not arrived when the actions were commenced. Revision of the 1925 taxes was not instituted in December, 1926, and there was no revised assessment roll as to those taxes available for filing in January, 1927. Proceedings were taken under section 106 of the charter to sell the property for the delinquent taxes and resulted in sales on October 10, 1932. It makes no difference here whether those sales were valid or irregular. The Getman action was commenced July 17, 1933, and the Moyer action on July 31, 1933. If proceedings for the sale were irregular, the sale was void. (Brown v. Goodwin, 75 N. Y. 409, 414.) If the sale was valid, the two-year period within which the taxpayer had to redeem (Charter, § 108) had not expired before the commencement of this action. Actions at law might have been brought for the purpose of collecting the delinquent taxes under section 111 of the charter. This was not done. In the absence of some law expressly limiting the time within which steps may be taken to enforce the hen or to collect the tax, the hen is not lost by the failure of officers to take steps prescribed for collection, or by failure to collect by the institution of prescribed proceedings or by recovery of a personal judgment against the taxpayer or by the institution of proceedings and the conduct therein of a void sale. (61 C. J. pp. 944-947, §§ 1213, 1214, 1218, 1220 and cases cited.) This court has held that an irregular or defective sale does not destroy the lien. (New York v. Colgate, 12 N. Y. 140.) Section 105 alone provides for a time limitation for the duration of the hen and as, we have pointed out, it is not apphcable. The hen of the 1925 school tax, therefore, was not lost.

Section 96 of the charter provides for a penalty of two per cent of the State and county tax in the event that it is not paid prior to February first of the year following the levy and an additional penalty of five per cent if it remains unpaid after February fifteenth of that year. Section 101 of the charter provides for a penalty of two per cent on city taxes if not paid before the first of June of the year in which they are levied and of five per cent if not paid before the first day of July. The penalty of two per cent on State and county taxes is to be added to the tax. The five per cent on such unpaid taxes is designated as the fee of the Chamberlain for collecting the same. In the event the city tax remains unpaid after the first day of August, the fee to be added to the tax is five per cent and that includes the previously mentioned two per cent fee on city tax. All such fees or penalties are not perquisites of the collecting agency but belong to the unit which is entitled to receive the tax. Penalties of two and five per cent are also imposed for delinquency in payment of the school taxes. Sections 106 and 111 of the charter clearly imply that interest of seven per cent per annum shall run upon delinquent taxes from the first day of December of the year in which the tax is payable. To hold otherwise would be to place a premium on the failure to pay taxes and to penalize the person who promptly pays as against the delinquent taxpayer.

In our system of real property taxation, penalties are often imposed in order to hasten payment, but they must be plainly imposed (Elliott v. Railroad Co., 99 U. S. 573, 576) and the law imposing them must be followed strictly. (People v. Wemple, 61 Hun, 53.) Penalties and interest are sometimes imposed as a penalty against the taxpayer for delinquency or for compelling the tax unit to proceed by action to collect the tax or to reimburse the public for the taxpayer’s failure to meet promptly the common obligation imposed for the support of the government. (League v. Texas, 184 U. S. 156.) Of course, a tax lien cannot be created by implication nor enlarged by construction and interest and penalties may be declared only in the event that the statute so prescribes and then only in the manner and subject to the conditions and in the amount imposed by statute (People v. Gold Telephone Co., 98 N. Y. 67; City of Rochester v. Bloss, 185 N. Y. 42; 1 Cooley on the Law of Taxation [4th ed.], § 22), but where interest and penalties are allowable by statute, they constitute a part of the tax lien against the property originally charged if they are for the benefit of the unit imposing the tax.

We think the provisions of the charter with sufficient clarity make the various penalties and interest specified under the conditions imposed in case of delinquency a part of the hens of the several taxes. It follows that, in accordance with the provisions of section 1087 of the Civil Practice Act, the referee should pay to the appellants (1) from the proceeds of the foreclosure sale of the Charles street property a sum representing the amount of each tax involved with fees as above indicated and interest at the rate of seven per cent per annum from December first of the year in which the tax was payable, and (2) from the proceeds of the sale on foreclosure of the Market street property the amount stated in the certificate of sale for taxes with interest at the rate of twelve per cent per annum from the date of such sale and the issuance of the certificate.

The order and judgment of the Appellate Division in each action in so far as the findings and decree of the Special Term are reversed and new findings made, should be reversed to the extent required by this opinion and such findings of the Special Term reinstated and amounts awarded in accordance with this opinion and the provisions of the judgment of foreclosure and sale, and as so reversed and modified should be affirmed, with costs in each action to appellants.

Crane, Ch. J., Lehman, O’Brien, Hubbs, Loughran and Finch, JJ., concur.

Judgment accordingly.


text:
    William Pearlman, as Administrator of the Estate of Eunice Pearlman, Deceased, Appellant, v. Garrod Shoe Company, Inc., Respondent.

      Argued October 20, 1937;
    decided November 23, 1937.

      Jeremiah A. O’Leary for appellant.
    In the special circumstances of the case, the trial court erred in depriving appellant of the benefits of the defendant’s express warranties with respect to the shoes purchased in refusing to send the case to the jury on the theory that intestate’s death was caused by a breach of warranty for which the defendant is answerable to plaintiff for the damages resulting therefrom to the intestate’s next of kin. (Bourcheix v. Willow Brook Dairy, Inc., 268 N. Y. 1; Redmond v. Borden’s Farm Products Co., 245 N. Y. 512; Gimenez v. Great A. & P. Tea Co., 264 N. Y. 390; Chysky v. Drake Bros. Co., 235 N. Y. 468; Turner v. Edison Storage Battery Co., 248 N. Y. 73; McSpedon v. Kunz, 271 N. Y. 131; Heaven v. Pender, 11 Q. B. Div. 503; Garvey v. Namm, 136 App. Div. 815; Union Nat. Bank v. Chapman, 169 N. Y. 538; Lorando v. Gethro, 228 Mass. 181; Hutchinson v. Ward, 114 App. Div. 156; Siedentop v. Buse, 47 N. Y. Supp. 809; Schmit v. Gillen, 58 N. Y. Supp. 458; Lawrence v. Fox, 20 N. Y. 268; Seaver v.
      Ransom, 224 N. Y. 233; Thomas v. Winchester, 6 N. Y. 397; Kuelling v. Lean Manufacturing Co., 183 N. Y. 78.) There is ample proof of defendant’s negligence. (Bourcheix v. Willow Brook Dairy, Inc., 268 N. Y. 1; Redmond v. Borden’s Farm Products Co., 245 N. Y. 512; Gimenez v. Great A. & P. Tea Co., 264 N. Y. 390; Chysky v. Drake Bros. Co., 235 N. Y. 468; Heaven v. Pender, 11 Q. B. Div. 503; Garvey v. Namm, 136 App. Div. 815.) It was error to dismiss the complaint upon the theory that the deceased, in wearing the shoes, was guilty of contributory negligence as a matter of law. (Camar do v. N. Y. St. Rys., 247 N. Y. 111; Zwack v. N. Y., L. E. & W. R. R. Co., 160 N. Y. 362; Lessin v. Board of Education, 247 N. Y. 503; Hill v. Baltimore & N. Y. Ry. Co., 75 App. Div. 325; Conrow v. Snyder, 215 App. Div. 603; Godwin v. Brooklyn Edison Co., 242 App. Div. 643; Simpson v. Fiero, 237 App. Div. 62; Touris v. Fairmont Creamery Co., 228 App. Div. 569; Hine v. Aird-Don Co., 232 App. Div. 359; Chamberlain v. Lehigh Valley R. R. Co., 238 N. Y. 233; Faber v. City of New York, 213 N. Y. 411.)

      Edward A. Harmon and William E. Lowther for respondent.
    No warranty existed between the deceased and the defendant for failure of privity of contract. There was no proof of a breach of warranty. (Meyer v. Kerschbaum, 133 Misc. Rep. 330; Wanamaker v. Weaver, 176 N. Y. 75; Gearing v. Berkson, 223 Mass. 257; Redmond v. Borden’s Farm Products Co., 245 N. Y. 512; Chysky v. Drake Brothers Co., 235 N. Y. 468; Turner v. Edison Storage Battery Co., 248 N. Y. 73; Gimenez v. Great Atlantic & Pacific Tea Co., 264 N. Y. 390; Zotto v. Merkel Brothers, Inc., 229 App. Div. 793; Smith v. Hanson, 228 App. Div. 634; McSpedon v. Kunz, 245 App. Div. 824; 271 N. Y. 131; Dickinson v. Sperling, 158 Misc. Rep. 905; Bourcheix v. Willow Brook Dairy Co., Inc., 268 N. Y. 1; McNeil & Higgins Co. v. Czarnikow-Rienda Co., 274 Fed. Rep. 397; Ryan v. Progressive Grocery Stores,
      255 N. Y. 388.) The defendant is not hable on any theory of negligence. No contractual relations existed between the parties and no element of inherent danger existed in the shoe or any of its parts. The occurrence was not reasonably to be anticipated and flowed directly from the failure of the intestate and her mother to use even the slightest care. (Pitman v. Lynn Gas & Electric Co., 135 N. E. Rep. 223; State v. Consolidated G., E. L. & P. Co., 126 Atl. Rep. 105; Barrango v. Hinckley Rendering Co., 119 N. E. Rep. 746; Simon v. Sun Ray Water Co., 162 N. Y. Supp. 968; Gindraux v. Maurice Mercantile Co., 47 Pac. Rep. [2d] 708; Hasbrouck v. Armour & Co., 121 N. W. Rep. 157; Akers v. Overbeck, 18 Misc. Rep. 198; Smith v. Peerless Glass Co., 259 N. Y. 292; Loesee v. Clute, 51 N. Y. 494; Loop v. Litchfield, 42 N. Y. 351; Cullen v. Renken Dairy Co., 247 App. Div. 742; Hoenig v. Central Stamping Co., 247 App. Div. 895; affd., 273 N. Y. 485; Kerwin v. Chippewa Shoe Mfg. Co., 163 Wis. 428; Van Leet v. Kilmer, 252 N. Y. 454.)
   Rippey, J.

This action is brought to recover damages arising out of the death of Eunice Pearlman. Defendant was a retailer of shoes. It represented, by means of advertising and orally at its store, that the shoes which it sold marked the latest step in the progress of shoe making and embodied every proven principle of health, of fit and of orthopedic design. On February 1, 1930, the deceased, a child of eight years of age, accompanied her mother to defendant’s store where she was fitted with a pair of shoes so advertised and so represented. The salesman was told that the child was under special training in ballet, toe and acrobatic dancing, was being prepared for a professional career as a dancer and that particular attention must be given to the quality and fit of her shoes. The salesman assured the mother that the shoes were “ perfect shoes for perfect feet ” and that the fit was perfect, and the child said the shoes “ felt all right.” So assured and relying upon the representations and assurances, the mother purchased the shoes. After deceased had worn the shoes for about a week, a blister was discovered above and back of the great toe of the right foot. Around the blister, the skin was red and inflamed. The mother then discovered that there was a wrinkle in the lining of the shoe which caused the blister and that the tip of the right shoe was longer than that on the left. Returning to the store, the mother showed the shoes to defendant’s salesman and pointed out the defects. He assured her the shoes were perfect shoes, perfect mates.” By this time the blister had broken. The salesman put cotton on the injured toe, replaced the shoe, and the child was taken home. An infection developed which, in spite of medical attention, caused the death of the little girl. Evidence was introduced at the trial to the effect that the shoe varied from standard principles of orthopedic design, that the fining was loose, bunched and creased and not properly fitted or lasted over and pulled tight; that a shoe so constructed was likely to develop wrinkles in the fining which was apt to cause an abrasion such as occurred and that such defects were readily observable to one who understood shoes. At the close of the plaintiff’s case the triál court granted defendant’s motion for a nonsuit and dismissed plaintiff’s complaint. From the judgment entered thereon, plaintiff appealed. The judgment was unanimously affirmed by the Appellate Division and the case comes to us by permission of this court.

Plaintiff seeks to recover both upon the ground of breach of an express warranty and of negligence: The trial court held that there was no privity of contract between the child and defendant and that recovery could not be had on the theory of a breach of warranty. Under varying circumstances, this court has held that an implied warranty of quality and fitness for a particular purpose as against- either a manufacturer or retailer does not inure to the benefit of a third party who is a stranger to the contract (Chysky v. Drake Brothers Co., 235 N. Y. 468; Redmond v. Borden’s Farm Products Co., 245 N. Y. 312; Turner v. Edison Storage Battery Co., 248 N. Y. 73; Gimenez v. Great Atlantic & Pacific Tea Co., 264 N. Y. 390), and that seems to be the prevalent general rule (3 Cooley on The Law of Torts [4th ed.], § 498), although liability for injury under special circumstances may be predicated on negligence. (Chysky v. Drake Brothers Co., supra; Bourchiex v. Willow Brook Dairy, Inc., 268 N. Y. 1.) Here there was an express warranty of quality and fitness for a special purpose. The action is brought under the death statute and recovery inures to the benefit solely of the father and mother as next of kin. (Decedent Estate Law [Cons. Laws, ch.T3], §§ 130, 133.)

-'Whether the special circumstances here disclosed present an exception to the rule applicable to cases involving implied warranty we are not required to decide. Under the pleadings and proof, plaintiff may recover on the ground of negligence irrespective of contract. (American Law Institute, Restatement of the Law of Torts [Negligence], vol. 2, ch. 14, §§ 398, 399, 401, 402; Bourchiex v. Willow Brook Dairy, Inc., supra.) Evidence here adduced was competent upon that issue and the questions of the freedom of deceased from contributory negligence and of the negligence of defendant could not be resolved by the court in favor of defendant as matter of law.

The judgment of the Appellate Division and that of the Trial Term should be reversed and a new trial granted, with costs to abide the event.

Crane, Ch. J., O’Brien and Loughran, JJ., concur; Lehman, Hubbs and Finch, JJ., dissent.

Judgments reversed, etc.


author: Hubbs, J.

text:
    Equitable Life Assurance Society of the United States, Appellant, v. Alexander Kushman et al., Respondents.
    Argued October 5, 1937;
    decided November 23, 1937.

      James D. Ewing and Peter C. Mann for appellant.
    The complaint states causes of action in equity. (Manhattan Life Ins. Co. v. Schwartz, 274 N. Y. 374; Guardian Life Ins. Co. v. Katz, 243 App. Div. 11; 269 N. Y. 625; Mutual Life Ins. Co. v. Union Trust Co., 244 App. Div. 764; Connecticut Mutual Life Ins. Co. v. Hirsch, 240 App. Div. 816; Connecticut General v. Brandstein, 233 App. Div. 723; Weigel v. Cook, 237 N. Y. 136; Vail v. Reynolds, 118 N. Y. 297; Commercial Credit Corp. v. Third & Lafayette Sts. Garage, Inc., 226 App. Div. 235; Silvestri v. Associated Gas & Electric Corp., 240 App. Div. 179; Sager v. Friedman, 270 N. Y. 472; Wood v. Hill, 214 App. Div. 417; Clark v. Kirby, 204 App. Div. 447; Merry Realty Co. v. Shamokin & Hollis R. E. Co., 230 N. Y. 316; Schank v. Schuchman, 212 N. Y. 352; Seneca Wire & Mfg. Co. v. Leach & Co., 247 N. Y. 1; New York Life Ins. Co. v. Waikin, 229 App. Div. 211; 256 N. Y. 618; Travelers Ins. Co. v. Pomerantz, 246 N. Y. 63; Charlton v. Metropolitan Life Ins. Co., 202 App. Div. 757 ; 234 N. Y. 639.) Equity alone can afford adequate relief under the circumstances presented. (Manhattan Life Ins. Co. v. Schwartz, 274 N. Y. 374; Guardian Life Ins. Co. v. Katz, 243 App. Div. 11; 269 N. Y. 625; Apter v. Equitable Life Ins. Co., 271 N. Y. 653; Prudential Ins. Co. v. Stone, 270 N. Y. 154.) The disputed status of the disability and double indemnity provisions makes it appropriate for the court to exercise its power to declare the rights and legal relations of the parties even though further relief is claimed. (Cohen v. N. Y. Mutual Life Ins. Co., 50 N. Y. 610; Meyer v. Knickerbocker Life Ins. Co., 73 N. Y. 516; Langan v. Supreme Council, 174 N. Y. 266; Ætna Life Ins. Co. v. Hayworth, 300 U. S. 227.)

      Morris A. Marks and George E. Netter for respondents.
    Having elected to rescind before bringing an action, plaintiff may sue at law to recover the money which it has paid. (Weigel v. Cook, 287 N. Y. 136; Sager v. Friedman, 270 N. Y. 472; Commercial Credit Corp. v. Third & L. Sts. Garage, 226 App. Div. 235; Commercial Credit Corp. v. Wells, 228 App. Div. 402; Silvestri v. Associated Gas & E. Co., 240 App. Div. 179; Schank v. Schuchman, 212 N. Y. 352; Seneca Wire & Mfg. Co. v. Leach & Co., 247 N. Y. 1; Continental Casualty Co. v. Yerxa, 16 Fed. Rep. [2d] 473.) There are no special circumstances here making equitable relief necessary. Plaintiff has an adequate remedy at law and, therefore, may not maintain this action in equity. (American Life Ins. Co. v. Stewart, 300 U. S. 203; New York Life Ins. Co. v. Faillace, 138 Misc. Rep. 182; 231 App. Div. 826; New York Life Ins. Co. v. Truesdale, 79 Fed. Rep. [2d] 481; Stroehmann v. Mutual Life Ins. Co., 81 Law. Ed. 502; Penn Mutual Life Ins. Co. v. McCarthy, 245 App. Div. 784; Greenberg v. Prudential Ins. Co., 246 App. Div. 727; Phœnix Mut. Life Ins. Co. v. Bailey, 13 Wall. 616; Cable v. U. S. Life Ins. Co., 191 U. S. 288; Globe Mutual Life Ins. Co. v. Reals, 79 N. Y. 202; Pacific Mut. Life Ins. Co. v. Parker, 71 Fed. Rep. [2d] 872; Pacific Mut. Life Ins. Co. v. Andrews, 77 Fed. Rep. [2d] 692; Nichols v. Pacific Mut. Life Ins. Co., 84 Fed. Rep. [2d] 896.)
   Hubbs, J.

The appellant issued two life insurance policies upon the life of the respondent Alexander Kushman. The respondent Esther Kushman is the beneficiary named in each policy. Each policy contained a disability and double indemnity provision.

The insured filed a claim with the appellant claiming to have become totally and permanently disabled. The claim was allowed and the company waived the payment of premiums and paid to the insured monthly the amount called for in the policies until it had paid $6,750. The complaint in this action alleges that appellant then discovered that the policies were procured by fraud; that the insured made material false and fraudulent statements in his application for the policies, and that the company relied upon such statements in issuing the policies.

The complaint also alleges that the company tendered to the insured the amount of the premiums which he had paid and notified the insured that the disability and double indemnity provisions of the policies were null, void and of no effect and that it rescinded the double indemnity and total and permanent disability provision contained in the policies. The complaint demands judgment for $6,750, the amount paid to the insured and that the double indemnity and permanent disability provisions of the policies be decreed to be null and void. Each policy contained a one-year incontestability clause which applied to the life insurance feature of the policies. As more than one year had expired before the commencement of this action, no question is raised as to the binding effect of the life insurance provision of the policies. The incontestability clause does not apply to the disability and double indemnity clause of some policies. {Manhattan Life Ins. Co. v. Schwartz, 274 N. Y. 374; Guardian Life Ins. Co. v. Katz, 243 App. Div. 11; affd., 269 N. Y. 625; Steinberg v. New York Life Ins. Co., 263 N. Y. 45.)

The policies here in question were not made a part of the record and no question was raised as to incontestability.

The complaint was dismissed by the Appellate Division upon the ground that it did not state a cause of action in equity as the plaintiff has a full and complete remedy in an action at law.

In at least two cases in this court a judgment canceling a disability and double indemnity clause of a policy in an action in equity on the ground that the policy was procured by fraud has been affirmed. It does not appear, however, that the point was made in either case that the plaintiff had a full and complete remedy at law. (Manhattan Life Ins. Co. v. Schwartz, supra; Guardian Life Ins. Co. v. Katz, supra.)

An action may be maintained in equity to cancel a life insurance policy which does not contain a disability and double indemnity provision, when the action is commenced before the incontestability clause has become effective. (New York Life Ins. Co. v. Watkin, 229 App. Div. 211; affd., 256 N. Y. 618; Travelers Ins. Co. v. Pomerants, 246 N. Y. 63; American Life Ins. Co. v. Stewart, 300 U. S. 203.)

The decision in each of those cases was based upon the ground that the incontestability clause created an exceptional circumstance which necessitated the intervention of a court of equity as the plaintiff’s rights might be jeopardized by the expiration of the period of contestability.

Black on Rescission and Cancellation (Vol. 3, p. 1569, § 652) states the general rule as follows:

Before a loss occurs under a policy of insurance (life), the company which issued it has no adequate remedy at law for fraud, false representations, or concealments which procured its issuance, and therefore a court of equity has jurisdiction of a suit to compel the surrender and cancellation of the policy * * *.
But after the death of the insured in a life policy, a court of equity should not take jurisdiction of a bill to secure the cancellation of the policy for fraud practised in procuring its issuance, because the company then has an adequate remedy at law, in that it may set up the fraud in defense to any action brought on the policy.” (See, also, to the same effect, 6 Couch Cyclopedia of Insurance Law, § 1435.)

In the case at bar the company may be liable upon the outstanding executory contract for double indemnity in the event that the insured should die as the result of an accidental injury. It should not be compelled to wait until the insured may choose to bring an action for one or more monthly installments claimed to be due him or until the beneficiary shall bring an action under the double indemnity provision before availing itself of the claim that the disability and double indemnity provision of the policies is void because of fraud in the inception of the policies. Parties to life and accident insurance policies should know definitely what their reciprocal rights and liabilities are. An insurer should not be helpless to compel an immediate determination of the question of its liability. It should not be compelled to set up a reserve against a contingent liability for which it contends it is not hable until such time as the insured or beneficiary may decide to bring an action.

It seems clear that appellant has not a clear and adequate remedy at law. Should it sue the insured in an action at law to recover $6,750, the amount paid to him under the disability provision of the policies, the respondent beneficiary named in the policies would not be a proper party to such a suit to recover money damages. Her interest in the policies is not a vested interest in the sense that her interest may not be divested. Nevertheless, she has property rights in the policies which make her a proper party to this action in equity. (Prudential Ins. Co. v. Stone, 270 N. Y. 154.)

It is desirable that her rights as well as those of the insurer and insured should be definitely determined in one action in which she may be at liberty to protect whatever rights she may have. The fact that the complaint alleges that plaintiff tendered to the insured the amount that he had paid as premiums and notified him that the plaintiff elected to rescind the policies does not constitute a rescission in the sense that plaintiff is thereby relegated to an action at law. (Travelers Ins. Co. v. Pomerantz, supra.)

In so far as being relieved from its obligations under the outstanding policies, the appellant could gain nothing by a declaration of rescission. In any event, the respondents have not changed their position in any way because of appellant’s statement. (American Law Institute, Restatement of the Law of Contracts, vol. 2, § 381.)

This action is clearly an action in equity for rescission. The fact that the complaint also demands a judgment for the amount paid to the insured before the discovery of the fraud does not make the action one at law. Damages may be recovered as incident to an action in equity for a rescission. We have reached the conclusion that in the special circumstances disclosed in the record the complaint states a cause of action in equity for rescission.

The judgment of the Appellate Division should be reversed and the order of the Special Term affirmed, with costs in this court and in the Appellate Division.

Crane, Ch. J., Lehman, O’Brien, Lotjghran, Finch and Rippey, JJ., concur.

Judgment accordingly.


author: Loughran, J.

text:
    In the Matter of the Estate of Mary M. Lagergren, Deceased. State Tax Commission, Appellant. Benjamin Moore et al., as Executors of Mary M. Lagergren, Deceased, Respondents.

      Argued October 5, 1937;
    decided November 23, 1937.

      Mortimer M. Kassell for appellant.
    The provisions of section 249-p of the Tax Law (Cons. Laws, ch. 60) are not in conflict with the due process clause of the Federal Constitution and were correctly construed by the estate tax appraiser. (Matter of Bronson, 150 N. Y. 1; Matter of New York & L. I. Bridge Co., 90 Hun, 312; Mangan v. City of Brooklyn, 98 N. Y. 585; People ex rel. Onondaga County Savings Bank v. Butler, 147 N. Y. 164; Tompkins v. Hunter, 149 N. Y. 117; Fire Department v. Stanton, 159 N. Y. 225; Maxwell v. Bugbee, 250 U. S. 525; Blackstone v. Miller, 188 U. S. 189; Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194; Great Atlantic & Pacific Tea Co. v. Grosjean, 301 U. S. 412; Kansas City, F. S. & M. Ry. Co. v. Botkin, 240 U. S, 227;
      Educational Films Cory. v. Ward, 282 U. S. 379; First Nat. Bank v. Maine, 284 U. S. 312; Knowlton v. Moore, 178 U. S. 41; Greiner v. Lewellyn, 258 U. S. 384; Blodgett v. Silberman, 277 U. S. 1; People ex rel. Northern Finance Corp. v. Lynch, 262 N. Y. 477; 290 U. S. 601; Pacific Co. v. Johnson, 285 U. S. 480.)

      Homer W. Lynch for respondents.
    The order of the Surrogate modifying the pro forma order was properly made. (Matter of Rueff, 157 Misc. Rep. 680.) Section 249-p of the Tax Law, if strictly and literally construed, is unconstitutional in that it violates the due process clause of the Federal Constitution. (First Nat. Bank v. Maine, 284 U. S. 312; People ex rel. Burby v. Howland, 155 N. Y. 270; Farmers Loan & Trust Co. v. Minnesota, 280 U. S. 204; Matter of Bankers Trust Co. v. Graves, 245 App. Div. 166; 270 N. Y. 316.)
   Loughran, J.

This appeal brings here for decision the question of the constitutional validity of section 249-p of the Tax Law (Cons. Laws, ch. 60), which prescribes a Tax on estates of nonresident decedents.” It is thereby provided:

“ A tax is hereby imposed upon the transfer of so much of the net estate of every person dying on or after the effective date of this article, who, at the time of death, was a nonresident of this state, as consists of real property situated and tangible personal property having an actual situs in this state. The amount of the tax on such real and tangible personal property shall be determined at follows:
“ Ascertain the amount of tax which would be payable under this article if the decedent had died a resident of this state with all his property (except real property situated and tangible personal property having an actual situs outside this state) situated or located within this state, and multiply the net tax so ascertained by a fraction the denominator of which shall be the value of the gross estate as ascertained for the purpose of computing such tax and the numerator of which shall be the said gross estate value of the real property situated and the tangible personal property having an actual situs in this state. The product shall be the amount of tax payable to this state. No credit shall be allowed against the tax so determined.
“ The tax imposed by this section shall be paid by the executor, who shall thereupon charge the same against and collect it from the persons interested in the estate in order that it shall be proportionately borne by those who have received the benefit.”

Mary Moore Lagergren died May 19, 1933, a nonresident of this State. She left a will which was admitted to probate by the Surrogate’s Court of the county of New York. At the direction of the Surrogate an appraiser fixed the fair market value of property of the estate subject to tax under the statute. His report showed a gross estate (including intangibles) of $818,954.74, total deductions of $254,230.33, and a net estate of $564,724.41. The total valuation of real property situated and tangible personal property having an actual situs within this State was reported to be $769,250. Exemptions allowed in the sum of $10,000 were deducted from the net estate of $564,724.41, leaving $554,724.41 as the estate the transfer of which would be taxable had the decedent died a resident of this State. In that event the tax would be $16,636.22.

In accordance with section 249-p, the Surrogate by a pro forma order found that g^ggg^’^, or 93.9307 per cent of $16,636.22, was the amount of tax payable to this State, viz., $15,626.52.

Intangibles included in the denominator of this fraction were valued at $42,739.81. The executors thereafter moved to modify the pro forma order “in so far as said order assesses a tax upon the basis of intangible personal property not situated within this State.” This motion was granted by an order which deducted the value of the intangibles from that of the gross estate and fixed the total tax accordingly at $14,499.23, a reduction of $1,127.29. The State Tax Commission appeals from the affirmance of that order by the Appellate Division.

It is clear that the transfer of the intangibles owned by this non-resident decedent cannot be taxed in this proceeding. This transfer — the taxable event — occurred at the decedent’s domicile outside this State. A tax thereon would offend the guaranty of due process. (U. S. Const., 14th Amendt., § 1; First Nat. Bank v. Maine, 284 U. S. 312. Cf. New York ex rel. Whitney v. Graves, 299 IT. S. 366.) Is that defect to be imputed to section 249-p of the Tax Law?

In Maxwell v. Bugbee (250 U. S. 525) a New Jersey statute which imposed an inheritance tax on the succession to local property of a non-resident decedent was upheld, although thereby “ the tax was first ascertained on the entire estate as if it were the estate of a resident of the State of New Jersey, with all the decedent’s property both real and personal located there,” and “ the tax was then apportioned and assessed in the proportion that the taxable New Jersey estate bore to the entire estate” (p. 534). It was there contended “that the effect of including the property beyond the jurisdiction of the State in measuring the tax, amounts to a deprivation of property without due process of law because it in effect taxes property beyond the jurisdiction of the State” (p. 539). This contention the court rejected for reasons stated as follows: “ When the State levies taxes within its authority, property not in itself taxable by the State may be used as a measure of the tax imposed * * *. In the present case the State imposes a privilege tax, clearly within its authority, and it has adopted as a measure of that tax the proportion which the specified local property bears to the entire estate of the decedent. * * * The transfer of certain property within the State is taxed by a rule which considers the entire estate in arriving' at the amount of the tax. It is in no just sense a tax upon the foreign property, real or personal ” (p. 539). (See Frick v. Pennsylvania, 268 U. S. 473, 495, 496.)

The executors do not deny that, so far as the issue has been determined by Maxwell v. Bugbee, the statute here challenged does not attempt to impose an extraterritorial tax in contravention of due process. We are told, however, that what the court said in that case must be read in the light of its later decisions condemning double taxation (First Nat. Bank v. Maine, supra; Wheeling Steel Corp. v. Fox, 298 U. S. 193, 208, 209), and that, so read, the case cannot now be deemed to be a" precise authority. This, of course, is a Federal and not a State question, and it is to the highest court of the nation that we must look for the answer.

In Great Atlantic & Pacific Tea Co. v. Grosjean (301 U. S. 412) there was presented the question whether the Fourteenth Amendment was offended by the tax imposed by a Louisiana statute on chain stores. The law provided that the tax “ shall be based on the number of stores or mercantile establishments included under the same general management, supervision, ownership or control, whether operated in this State or not, and shall be fixed and graded as follows to wit: (1) Upon stores or mercantile establishments operated in this State and belonging to a chain or group having a total of not more than ten stores, the annual license shall be Ten ($10.00) Dollars for each such store operated in this State” (p. 418). Other provisions progressively increased the rate per store in Louisiana of larger chains. Holding that this legislation was not invalid as an attempt to tax property and activities which were beyond the State’s jurisdiction, the court said: “The State may not tax real property or tangible personal property lying outside her borders; nor may she lay an excise or privilege tax upon the exercise or enjoyment of a right or privilege in another State derived from the laws of that State and therein exercised and enjoyed. But, as we have seen, the subject of the tax in question is the prosecution of a defined business activity within the State of Louisiana,— the conduct of a retail store which is a part of a chain under a single management, ownership or control,— a legitimate subject of a license or occupation tax. The measure of the exaction is the number of units of the chain within the State,— a measure sanctioned by our decisions. The rate of tax for each such unit is fixed by reference to the size of the entire chain. In legal contemplation the State does not lay a tax upon property lying beyond her borders nor does she tax any privilege exercised and enjoyed by the taxpayer in other states ” (pp. 424,425). While the court went on to rest its decision on much broader considerations than conceptions of subject, measure and rate of tax,” it also said: “ Maxwell v. Bugbee, 250 U. S. 525, goes far to sustain the validity of the act ” (p. 425).

Thus there is no warrant for our saying that the point of constitutional law announced in Maxwell v. Bugbee has been repudiated. Only the court which decided it can say whether fresh consideration of that border-line case is desirable. It follows that the statute before us must here be upheld as written and that the tax assessed by the original pro forma order is payable to this State.

In reaching the contrary conclusion, the Surrogate relied upon Matter of Rueff (157 Misc. Rep. 680; 249 App. Div. 617). In that case we dismissed an appeal taken without leave as in a case wherein is directly involved the construction of the Constitution of the United States. (Civ. Prac. Act, § 588, subd. 1.) This court found that such a question was not there directly involved. The case could have been, and was, decided upon the construction of a statute.” (273 N. Y. 530.) We add a few words in explanation of that ruling.

“ Gross estate ” is defined by section 249-r of the Tax Law. The definition excludes “ real property situated and tangible personal property having an actual situs outside this state.” Section 249-s provides that “ the value of the net estate shall be determined by deducting from the value of the gross estate ” the full amount of debts, expenses and losses. In the Rueff case the net estate, so ascertained, was $61,122.31. The intangibles included in the gross estate were valued at $78,743.90. On that showing the Surrogate there said: “ It is apparent, therefore, that if the value of the intangibles had been excluded from the gross estate and had the same deductions been made there would have been a deficit of $17,621.59 reported instead of a net estate of $61,122.31. No tax can be assessed on a deficit.” (157 Misc. Rep. 680, 681.) It is true that the statute does not say that the deductions allowed by section 249-s are limited by the formula prescribed by section 249-p or that only such portion thereof shall be made as will leave a taxable net estate. The statute directs that such deductions shall be made. Accordingly in the Rueff case one ground of the decision below was that the statute, properly construed, authorized no tax in the situation there presented. The Tax Law here says what deductions shall be made in ascertaining the net estate. When those deductions are made and applied to the property tangibly within this State there is no property here subject to tax.” (157 Misc. Rep. at p. 685.)

In the present case the estate (exclusive of intangibles) is $521,984.60 after all deductions are made.

The order of the Appellate Division should be reversed and that of the Surrogate’s Court modified in accordance with this opinion, and as so modified affirmed, and the matter remitted to the Surrogate’s Court for further proceedings in accordance with this opinion, without costs.

Crane, Ch. J., Lehman, O’Brien, Hubbs, Finch and Rippey, JJ., concur.

Ordered accordingly.