text:
    The People of the State of New York, Respondent, v. Eli Gersewitz, Appellant.
    Argued March 8, 1945;
    decided April 12, 1945.

      Jacob Shientag for appellant.
    I. The sections of the Code of Criminal Procedure concerning appeals are inapplicable. There is, however, a clear implication in section 520 of that Code that the Legislature intended every defendant to have ¡the benefit of at least one appeal and under certain circumstances further review. (People v. Redmond, 225 N. Y. 206; People ex rel. Hummel v. Reardon, 186 N. Y. 164; People ex rel. Taylor v. Forbes, 143 N. Y. 219; People ex rel. Curtis v. Kidney, 225 N. Y. 299; People ex rel. Hummel v. Trial Term, 184 N. Y. 30; People v. Glen, 173 N. Y. 395; People v. Wright, 263 App. Div. 1020; People v. Sexton, 187 N. Y. 495; People ex rel. Weeks v. Platt, 173 App. Div. 451; Mooney v. Holohan, 294 U. S. 103.) II. The application herein may be deemed a special proceeding within the meaning of section 5 of the Civil Practice Act for the redress or prevention of a wrong in a criminal action. (Civ. Prac. Act, § 4.) As an order in a special proceeding, the right to appeal therefrom is expressly given by section 631 of the Civil Practice Act. (People ex rel. Board of Charities v. Davis, 15 Hun 209.) III. Whether the right to appeal is within the intent of section 520 of the Code of Criminal Procedure or sections 631 and 622 of the Civil Practice Act, or it is inherently attached to the remedy disclosed in Lyons v. Goldstein (290 N. Y. 19), such right should be found to exist. There is no statute which expressly negatives same or reveals a purpose that the determination of the court of first instance should be final. (People v. Butts, 121 App. Div. 226; People v. Priori, 163 N. Y. 99; People ex rel. Feeny v. Bd. of Canvassers, 156 N. Y. 37; People ex rel. Prisament v. Brophy, 287 N. Y. 132.) IV. The law in other jurisdictions should be followed. (Hardzog v. State, 49 Okla. Crim. 244; Fromcke v. State, 37 Okla. Crim. 421; State v. Cochran, 332 Mo. 742; State v. Dale, 282 Mo. 663; Harris v. State, 203 Ind. 504; People v. Gardner, 106 Ill. 76; People v. Walker, 250 Ill. 427; People v. Schwarz, 201 Cal. 309; People v. Perez, 9 Cal. App. 265; State v. Casaras, 104 Mont. 404; Cassidy v. State, 201 Ind. 311; State v. Raponi, 182 P. 855.)

      William O’Dwyer, District Attorney (Fred J. Longhran of counsel), for respondent.
    I. An appeal is not a necessary element of due process since there is no constitutional right attached to it. The privilege is purely statutory and in the absence of a statute provision for it, an appeal must be dismissed. (McKane v. Durston, 153 U. S. 684; People v. Bellows, 281 N. Y. 67; People v. Zerillo, 200 N. Y. 443; People v. Antonio, 265 N. Y. 247; People v. Regan, 292 N. Y. 109.) II. This is an appeal in a criminal action and as such is controlled by the Code of Criminal Procedure. The Civil Practice Act has no application. (The People v. Hovey, 92 N. Y. 554; People v. Glen, 173 N. Y. 395; Matter of Lyons v. Goldstein, 290 N. Y. 19; People ex rel. Curtis v. Kidney, 225 N. Y. 299; State v. Nelson, 107 P. 2d 1113.)
   Lehman, Ch. J.

The defendant on December 5,1927, pleaded not guilty in the County Court of Kings County to an indictment charging him with the crime of robbery in the first degree, grand larceny .in the first degree and assault in the second degree. On December 20,1927, he was permitted to withdraw his plea of not guilty and to “ plead guilty to the crime of Robbery in the First Degree without a gun On April 11, 1928, he was sentenced upon that plea to imprisonment in the State Prison at Sing Sing for a term of not less than fifteen nor more than thirty years. He was released on parole in September, 1934. In April, 1936, he was again convicted of robbery and sentenced to imprisonment for a term of thirty-five years as a second offender. In April, 1944, the defendant moved in the County Court of Kings County for an order setting aside the judgment of conviction entered upon his plea of guilty in December, 1927, and permitting him to withdraw his plea of guilty.

Upon that motion the defendant presented affidavits intended to show that at the time he pleaded guilty he was not represented by counsel and was not advised of his constitutional right to be represented by counsel and that the judgment of conviction entered upon such plea does not accord with the requirements of due process of law. Answering affidavits were interposed by the People. The court denied the defendant’s motion on the ground that the moving papers, when considered with the opposing affidavits, do not sufficiently establish that the defendant was not advised of his constitutional and statutory rights to counsel.” An appeal to the Appellate Division from, the order denying the motion of the defendant was dismissed. By permission of the writer of this opinion the defendant has appealed to this court.

The Code of Criminal Procedure provides that the only mode of reviewing a judgment or order in a criminal action or proceeding, or special proceeding of a criminal nature, is by appeal ” (§ 515). “ An appeal to the supreme court may be taken by the defendant from the judgment on a conviction after indictment * * * and upon the appeal, any actual decision of the court in an intermediate order or proceeding forming a part of the judgment-roll * * * may be reviewed ” (§ 517), The statute makes no provision for the review of any order in a criminal action which does not form part of the judgment roll presented to the appellate court upon an appeal from a “ judgment on a conviction ”, It has repeatedly been held that the appellate jurisdiction of the courts of this state in criminal cases is purely statutory; and, of course, such jurisdiction can never be assumed, unless a statute can be found which expressly sanctions its exercise.” (People v. Zerillo, 200 N. Y. 443, 446.) No appeal is pending or will now lie from the judgment of conviction of the defendant-appellant and for that reason the Appellate Division held that no appeal could be taken from the order of the County Court entered in 1944 denying the motion to vacate the judgment entered in 1928. The only question we may consider upon the appeal from the order of the Appellate Division is whether the defendant had a right to appeal to that court though authority for such an appeal is not expressly conferred by the Code of Criminal Procedure or by any other statute.

Perhaps the omission of the Legislature to provide for an appeal from an order denying a motion to vacate a judgment of conviction should not be construed as an intentional denial to an aggrieved defendant of a right to appeal. Argument not without force may be made that when the Legislature in section 517 of the Code of Criminal Procedure enumerated “ In what cases appeal may be taken by defendant ” it intended to cover only the field in which the courts exercised authority established by statute without considering whether there remained an undefined field in which the courts might exercise an “ inherent ” authority not established by statute. In a long line of cases this court has consistently applied the principle that the Code of Criminal Procedure establishes the practice in all criminal cases and the authority for the orders and judgments of the courts ” within the field where the Legislature may grant authority to a court or may withhold it. (People ex rel. Hirschberg v. Orange Co. Ct., 271 N. Y. 151, 155.) The court has nonetheless recognized, at the same time, that courts have always asserted and exercised authority which, though perhaps not expressly established by statute, is “ based upon the inherent right and duty of the courts to protect the citizen in his constitutional prerogatives and to prevent oppression or persecution.” “ It is a power,” the court said, “ which the legislature can neither curtail nor abolish, and, to the extent that legislative enactments are designed to effect either of these ends, they are unconstitutional.” (People v. Glen, 173 N. Y. 395, 400.) We have sanctioned the exercise of such a power by a court to correct its own record or to set aside an order or judgment which was induced by fraud or procured in violation of a constitutional right of a party. Perhaps that power can have no broader scope. Ho case has been presented to the court in which the court was called upon to define its exact limits, but in March, 1943, this court authoritatively decided (three judges dissenting) that a court of criminal jurisdiction has “ inherent ” power to set aside a judgment procured by fraud and misrepresentation and to permit a defendant to withdraw a plea of guilty induced by violation of his constitutional rights (Matter of Lyons v. Goldstein, 290 N. Y. 19); and in Matter of Morhous v. N. Y. Supreme Court (293 N. Y, 131), we held that a motion to vacate a judgment procured by violation of the defendant’s constitutional rights is the corrective judicial process which is authorized by the law of the State to remedy the alleged wrong to the defendant and that it adequately meets the requirement of “ due process ”. The problem now presented is whether the appellate court may entertain an appeal from an order of the court, in which the conviction was had, denying a motion to vacate the conviction though the Code of Criminal Procedure does not provide for an appeal from an order in a criminal action or proceeding except where the order is made pursuant to practice and authority established by statute.

Though we have held that the Legislature cannot withhold from a court of general criminal jurisdiction powers which the court must have in order that its judgment may meet the constitutional requirements of due process, a right of appeal is not such a requirement. “ An appeal from a judgment of conviction is not a matter of absolute right, independently of constitutional or statutory provisions allowing such appeal. A review by an appellate court of the final judgment in a criminal case * * * was not at common law and is not now a necessary element of due process of law.” (McKane v. Durston, 153 U. S. 684, 687.) No provision of the Constitution constrains the Legislature to provide a right of review by an appellate court of every decision of a single judge, affecting a substantial right, though generally such a right is provided and has, indeed, been regarded as fundamental. (People v. Priori, 163 N. Y. 99.) A motion which invokes the “ inherent ” power of the court to remedy an alleged violation of a defendant’s constitutional rights is analogous, in some respects, to proceedings initiated by the common law writ of coram nobis and to proceedings initiated by a petition for a writ of habeas corpus; but habeas corpus proceedings are special proceedings, classified by the Legislature as civil proceedings in the Civil Practice Act and an appeal from a final order in such a proceeding may be taken as provided in that act. (People ex rel. Curtis v. Kidney, 225 N. Y. 299.) Though habeas corpus proceedings are the traditional remedy used by a defendant to “ get released from custody under a criminal prosecution ” (Ex parte Tom Tong, 108 U. S. 556, 560), the proceedings are not an incident to the criminal prosecution. In such proceedings the petitioner seeks to invoke the power of a court, other than that in which the prosecution was had, to vacate a judgment or order made in the course of the criminal prosecution by a court without jurisdiction or which failed to exercise, or perhaps did not-have, adequate authority to protect the defendant in his constitutional rights. By motion to the court, in which a conviction was had, to vacate its own judgment and to discharge a defendant from custody thereunder or to grant a new trial, the defendant invokes the power of the court to vindicate the defendant’s constitutional rights in the criminal prosecution. Such a motion is not a “ special proceeding ” as defined by the Civil Practice Act but is made in the criminal action, and an order made upon such a motion is an “ intermediate order ” from which an appeal may be taken only if a right to review of the order is established by the Code of Criminal Procedure. Argument that the omission of the Legislature to provide for an appeal from such an order was inadvertent and that the omission should bo supplied may be persuasive; but such arguments must be addressed to the Legislature. The court has no power to supply even'an inadvertent omission of the Legislature.

The order should be affirmed.

Loughran, Lewis, Conway, Desmond, Thacher and Dye, JJ., concur.

Order affirmed.


source: Caselaw Access Project

author: Conway, J.

license: Public Domain

text:
    In the Matter of Samuel S. Goodman, Respondent, against Henry W. Ralph, as Register of the City of New York and Recording Officer of the County of New York, Respondent, and Frank C. Moore, as Comptroller of the State of New York, et al., Appellants.
    Argued February 26, 1945;
    decided April 12, 1945.

      Nathaniel L. Goldstein, Attorney-General (Harry F. Karst, Orrin G. Judd and William F. McNulty of counsel), for appellants.
    1. There is no basis, either in law or in fact, to support the finding of the Special Term that petitioner is an employee of the State of New York. (Matter of Miller v. State, 279 N. Y. 74.) II. Petitioner is an employee of the City of New York. (Matter of O’Donnell v. Smith, 231 App. Div. 482; London v. Toney, 263 N. Y. 439; Matter of Miller v. State, 279 N. Y. 74.)

      Samuel S. Goodman, respondent in person.
    Petitioner is an employee of the State of New York and is entitled to a peremptory order. (Matter of Rohr v. Kenngott, 288 N. Y. 97.)
   Conway, J.

There is presented to us for our determination the question whether the petitioner is a State employee within the meaning of chapter 187 of the Laws of 1943, providing for the payment of additional war emergency compensation to “ state officers and employees, other than officers and employees of the legislature and judiciary, who are regularly employed * * * The statute contains no definition of the term State employee.

The petitioner was originally appointed a clerk in the office of the Register of the County of New York as a civil service employee in the competitive class in the Mortgage Tax Bureau of the .Register’s office. Thereafter, upon passing a promotion examination, he was appointed to the position of Mortgage Tax Examiner. Tax Law, section 253, imposes a recording tax upon mortgages on real property within the State. The tax is payable at the time of the recording of the mortgage and must be paid to the recording officer of the county in which the real property is situated (§ 257). At the time of the institution of the present proceeding, the applicable statute provided (Tax Law, art. 11, § 262) that the recording officer should he entitled to receive all necessary expenses “ for the purposes of this article, including printing, hire of clerks and assistants, being first approved and allowed by the tax commission and, after audit by the comptroller,” to retain such expenses out of the moneys collected. Section 261 then provided, after the deduction of the expenses, for the transmittal of one half of the net amount remaining to the Commissioner of Taxation and Finance to be paid into the State treasury and for the payment of the other half, in the counties within the city of New York, to the general fund of the City of New York. Now, by Laws of 1944, chapter 122, the whole of the net amount so collected, after the deduction of the necessary expenses, in the counties within the city, is paid into the general fund of the city of New York. Section 263 provides that the Tax Commission shall have general supervisory power over all recording officers in respect to the duties imposed upon them by article 11 and may make such rules and regulations for the government of recording officers in respect to the matters provided for in that article as they deem proper, provided they are not inconsistent with the statute.

It cannot be questioned that the collection of mortgage recording taxes is a State function, but neither can it be questioned that the Legislature has delegated the duty of collecting such taxes in New York County to the Register, with the power in him to hire clerks and assistants to whom the Register may further delegate portions of his work in connection with the collection of such moneys. The power to select and appoint these clerks and assistants from civil service lists imports the right also to discharge them, except as restrained by the Constitution or by statute. (People ex rel. Griffin v. Lathrop et al., 142 N. Y. 113; Thoma v. City of New York, 263 N. Y. 402.) While the Register is now a city official (New York City Charter [1938], ch. 45; Burke v. Kern, 287 N. Y. 203), what was said in Matter of O’Donnell v. Smith (231 App. Div. 482, 483) when the office of Register of the County of Kings was a county office, is applicable here: “ The petitioner, in the mortgage tax bureau, to whom, pursuant to section 262 of the Tax Law (as amd. by Laws of 1921, chap. 271), the register delegates a portion of the work thus imposed upon the register, cannot have any different status from that possessed by his principal, the official (register) specified in section 261 of the Tax Law.” ' Matter of Rohr v. Kenngott (288 N. Y. 97), is not to the contrary. The language at page 102, upon which the petitioner here relies, was used for the purpose of pointing out that the petitioner there was not the private employee of .the County Clerk but was an employee of the State or a civil division or city thereof, as defined in subdivision 3 of section 2 of the Civil Service Law.

As we have seen, the money paid petitioner was first deducted by the Register from the mortgage recording taxes collected by him, and then the balance was divided equally between the State and city. True, the sums thus retained by the Register as expenses had to be approved and allowed by the Tax Commission and audited by the Comptroller of the State, but those acts would not determine the identity of petitioner’s employer. They merely had to do with the duty of the Register to account for the moneys collected by him. We think that the determinative factor here is that no State officer or body ever had the power or authority to appoint or discharge the petitioner.

The orders should be reversed, with costs in all courts, and the petition dismissed.

Lehman, Ch. J., Loughran, Lewis, Desmond, Thacher and Dye, JJ., concur.

Orders reversed, etc.


author: Lehman, Ch. J.

text:
    In the Matter of William P. McDonald, Appellant, against Charles S. Colden, a Judge of the County Court of the County of Queens, Respondent.
    Argued February 19, 1945;
    decided April 12, 1945.

      George Morton Levy, Walter G. McGahan and Irving Goldberg for appellant.
    1. A term of court cannot be continued by implication. (People v. Sullivan, 115 N. Y. 185; People v. Jackson, 205 App. Div. 202; Matter of Spector v. Allen, 281 N. Y. 251; Matter of Reynolds v. Cropsey, 241 N. Y. 389; Saranac Land & Timber Co. v. Roberts, 227 N. Y. 188; Shields v. New York Oil Burner Co., 288 N. Y. 22.) II. The continuation of a regular term without date “ until the further order of the court ” is invalid and ineffective. (Matter of Reynolds v. Cropsey, 241 N. Y. 389; Saranac Land & Timber Co. v. Roberts, 227 N. Y. 188.) III. The court below misconstrued the purpose and effect of subdivision 3 of section 190 of the Judiciary Law. IV. A refusal to testify before a grand jury whose legal tenure has expired does not constitute a valid basis for a charge of criminal contempt. (Matter of Spector v. Allen, 281 N. Y. 251; People v. Nugent, 57 App. Div. 542; The People v. Petrea, 92 N. Y. 128.) V. The failure properly to continue a term of court may not be disregarded as a mere irregularity. (Saranac Land & Timber Co. v. Roberts, 227 N. Y. 188.)

      Nathaniel L. Goldstein, Attorney-General (William F. McNulty, Orrin G. Judd and Harry F. Karst of counsel), for respondent.
    I. The, September 1940 Grand Jury did not become functus officio at the end of February, 1941. II. The order of March 6, 1941, continuing the September 1940 Grand Jury “ until further order of the Court,” validly continued the legal existence of said Grand Jury after that date. (Matter of Reynolds v. Cropsey, 241 N. Y. 389; People ex rel. Gracy v. Strohson, 127 Misc. 199, 217 App. Div. 750; People v. Sullivan, 115 N. Y. 185; People ex rel. Weick v. Warden, 117 App. Div. 154, 188 N. Y. 549; People v. Central City Bank, 53 Barb. 412.)
   Lehman, Ch. J.

The appellant was served with a subpoena commanding him to appear on June 30,1942, before the Grand Jury of the County of Queens, empanelled for the September 1940 Term of the County Court, “as a witness in a criminal action prosecuted by the People of the State of New York against ‘ John Doe ’ and ‘ Bichard Boe ’ ”, Upon his appearance before the Grand Jury at the time and place specified in the subpoena he declined to be sworn and to testify upon the ground that the September 1940 Term of the Queens County Court was not properly continued after the month of March, 1941, and that by virtue thereof your Grand Jury was not legally or duly constituted and was without power to administer a legal oath or to confer upon me the immunity to which I would otherwise be entitled under the law by reason of any testimony which I might give.” An application was thereupon made to the court by the foreman of the Grand Jury for an order adjudging the appellant guilty of contempt of court pursuant to the provisions of section 750 of the Judiciary Law. The court on October 29, 1942, made an order which 11 adjudged that the said grand jury for the September 1940 Term of this Court was and is duly and legally constituted ” and which directed the appellant on November 5th “ to appear before said grand jury and be sworn and that he answer all proper questions put to him ”. The appellant, on November 5, 1942, appeared but again declined to be sworn and to testify upon the grounds previously stated, and for that refusal he was adjudged guilty of a criminal contempt of court and was fined the sum of $250. By permission of this Court he has appealed from the unanimous order of the Appellate Division confirming» the determination of the County Court adjudging the appellant in contempt.

The Grand Jury for the September 1940 Term of the County Court of Queens County was empanelled on September 9, 1940, at the regular September 1940 Term of the court, established pursuant to an order made by the judges of that court. At that time an assistant Attorney-General specially appointed for that purpose was conducting an invesligation in Kings County of possible criminal acts in connection with paving contracts made by the City of New York. In the course of the investigation it became apparent that he might find it necessary to invoke action by a grand jury in Queens County, and accordingly an assistant commenced to present evidence to the 1940 Grand Jury, summoned for the regular September 1940 Term of the County Court, which had theretofore considered matters presented by the District Attorney of the County not connected with the investigation of paving contracts. The problem presented upon this appeal is whether the September 1940 Term still continued and the Grand Jury empanelled for that term still functioned as an arm of the court in June and in November, 1942.

In the English common-law courts, terms were “ instituted ” or were gradually formed from the canonical constitutions of the church ”. It is said that in early times “ the church interposed and exempted certain holy seasons from being profaned by the tumult of forensic litigations Later, when the State alone exercised authority in common-law courts, “ the commencement and duration of our law terms were appointed with an eye to those canonical prohibitions ”. (3 Blackstone’s Com., ch. XVIII, 275, 276.) This court, speaking through Commissioners of Appeals, has said that in common-law courts as distinguished from courts of equity, “ strict judicial business could only be transacted at these terms, though, after a time, many incidental matters were transacted out of court. (3 Blackstone’s Com., 275, 279; Spelman’s Origin of Terms, passim.) The terms of court, thus, have a purely historical character, and there is no reason, in the nature of judicial business, why they should exist, nor why such business should be confined to them.” (Brown v. Snell et al., 57 N. Y. 286, 300.)

Under the Constitution and statutes of New York, and generally throughout the United States, the general rule still is that “ strict judicial business ” should be confined to stated terms of the courts. “ It is necessary that the times and places of holding courts be fixed in advance that jurors can be drawn therefor, and that notices can be given and the necessary steps taken to obtain jurisdiction of the parties in civil and criminal actions and proceedings ” (Saranac Land & Timber Co. v. Roberts, 227 N. Y. 188, 193-194). The September 1940 Term of the Queens County Court was appointed for a fixed period and it ended with the expiration of that period unless it was continued thereafter in accordance with the law of the State. (Matter of Reynolds v. Cropsey, 241 N. Y. 389.)

The Judiciary Law, section 190, provides that The county judge must, from time to time, appoint the times and places for holding terms of his court ” and that Each term may continue as long as the county judge deems necessary;” In the case now under consideration it appeared during September, 1940, that the Grand Jury would not complete its consideration of evidence which the Attorney-General intended to present to it during the period of time for which the September 1940 Term was appointed and accordingly, on September 30,1940, the court directed that the September Term be continued for and during the months of October, November and December, 1940. The Grand Jury held regular meetings during these months and the minutes of the Clerk of the County Court show that on December 19, 1940, “ the foreman of the September Grand Jury appeared in court and handed up one indictment (sixteen defendants) and one presentment and their duties not being completed, he was excused to continue the same. On motion of the District Attorney, the September 1940 Term of the County Court, Part II, and the Grand Jury for the September 1940 Term are continued during the months of January and February 1941 and until further order of the Court.” The minutes of February 25,1941, show that the foreman of the September 1940 Grand Jury appeared in Court and handed up one indictment and their duties not being completed he was excused to continue the same ’ ’, and that the Clerk of the County of Queens was directed to summon ten additional grand jurors according to law to attend and appear at the September 1940 Term of the County Court, Queens County, at the County Courthouse, in the County of Queens, City of New York, on the 6th day of March 1941 at 10 o’clock in the forenoon of that day: * * * On March 6th some members of the Grand Jury, who had asked to be relieved of further service, were excused and nine additional members were sworn in, and the jurors were directed1 to inquire into ” matters which would be brought before them but not to consider any matters which have heretofore been examined by the Grand Jury up to the present time.” An entry was made on March 6th in the clerk’s minutes that “ the September 1940 Grand Jury is ordered continued until further order of the court.” The Grand Jury thereafter held weekly sessions except during the summer recess and considered evidence presented by the Attorney-General but no further entry was made in the minutes of the court prior to the dates in June and in November, 1941, upon which the appellant declined to be sworn.

The Judiciary Law, section 7, provides that “ Any term of a court of record may be adjourned from day to day, or to a specified future day, by an entry in the minutes.” It is the contention of the appellant that a term can be continued beyond the fixed period for which it was appointed only by an entry in the minutes which complies substantially with that statute. He does not challenge the sufficiency of the entries in the minutes continuing the September 1940 Term until the end of February, but does challenge the sufficiency of the entries made "on February 25, 1941, and on March 6, 1941. After the term of a court has been regularly convened the court has inherent power, not limited to that which is derived from the statute, to continue ihe term* at least so long as reasonably necessary to dispose of unfinished business and to adjourn it from day to day or to a specified date. The statute points out the “ method of procedure ” which all courts of record should ordinarily follow in adjourning a term of the court so that there may be a public record showing whether the court will be available for the conduct of judicial business and when and where it will hold its session; but failure to follow that method in continuing or adjourning a term does not always work a dissolution of the term. This court has said that at least in some circumstances even the “ most rigorous rule of law ” should not “ compel a court to admit its loss of jurisdiction and the consequent failure of all proceedings taken before it,” though the statutory method of adjournment may not have been followed. (People v. Sullivan, 115 N. Y. 185, 188.)

Though we have said above that the statutory method which the Legislature has directed should ordinarily be used “ in continuing or adjourning ” a term, yet literally the statute applies only to an “ adjournment ” of a term of a court of record to a future day. In Matter of Reynolds v. Cropsey (241 N. Y. 389, opinion by Crane, J.), we pointed out that there is no valid distinction between a direction that a term should be adjourned ” without day and a direction that the term be “ continued ” without day, where at the time the direction is made, there remains no unfinished judicial business before the court, and the intent of the direction is to suspend all judicial business for an indefinite time in order to permit the court thereafter to take up and dispose of new matters in the discretion of the judge. Such a direction is, it is plain, an “ adjournment ” regardless of the label attached to it. In a separate opinion by Hiscock, Ch. J., in which a majority of the judges concurred, the court there pointed out that the cessation of the proceedings of a court ” in that case was “ not a brief and temporary suspension of its activities keeping it alive for further business ” but was “ an abandonment of the term of court which results in its death and termination ” (p. 400).

Here on the contrary there has been no “ suspension ” of the activities of the court beyond such brief periods as are customary and convenient in-the conduct of judicial business by the court and the grand jury. The investigation initiated before the September 1940 Term of the court had not been finished at the end of September, 1940; it had not been finished on February 25, 1941. Regular sessions of the Grand Jury were suspended on that day solely for the purpose of obtaining additional jurors on March 6, 1941, who would continue the investigation, though only upon new evidence which might thereafter be presented.

We said in Matter of Reynolds v. Cropsey (supra, p. 394): We do not mean to hold that the ending of a term of court is dependent entirely upon a form of words used by a clerk in making his entries.” Here it appears beyond possibility of dispute that the court by its direction intended that there should be no cessation or even interruption of the work of the Grand Jury and that the term should be continued from day to day until the investigation was-completed and the court had disposed of business which might be brought before it in connection with that investigation, or until the term was ended by further order of the court. Irregularity in the formulation of that direction or of the entry in the clerk’s minutes under the circumstances did not dissolve the term.

The order should be affirmed, without costs.

Loughran, Lewis, Conway, Desmond, Thacher and Dye, JJ., concur.

Order affirmed.


text:
    Samuel R. Shielcrawt et al., Suing on Behalf of Themselves and All Other Stockholders of Corn Products Refining Company, and on Behalf of Corn Products Refining Company, Appellants, v. George M. Moffett et al., Defendants, and Corn Products Refining Company, Respondent.
    Argued February 20, 1945;
    decided April 12, 1945.

      The following questions were certified:
    “1: Is § 61-b of the General Corporation Law (Chap. 668 of the Laws of 1944) applicable to suits begun prior to the enactment thereof ?;
    “2: Is § 61-a of the General Corporation Law (Chap. 350 of the Laws of 1941) applicable to suits begun prior to the enactment thereof ?;
    “3: Is § 61-b of the General Corporation Law applicable to this litigation?;
    “ 4: § 61-a of the General Corporation Law applicable to this litigation ?;
    “5: Does § 61-b of the General Corporation Law contravene: a) § 6 of Art. 1 of the Constitution of the State of New York; b) § 11 of Art. 1 of the Constitution of the State of New York; c) § 1 of Art. 6 of the Constitution of the State of New York;
    “ 6: Does § 61-a of the General Corporation Law contravene: a) § 6 of Art. 1 of the Constitution of the State of New York; b) § 11 of Art. 1 of the Constitution of the State of New York; c) § 1 of Art. 6 of the Constitution of the State of New York;

      “7: Does § .61-b of the General Coropration Law contravene: a) Amendment V of the Constitution of the United States; b) Amendment XIV of the Constitution of the United States; c) Art. 1 § 10 of the Constitution of the United States;

      “8: Does § 61-a of the General Corporation Law contravene: a) Amendment V of the Constitution of the United States; b) Amendment- XIV of the Constitution of the United States; c) Art. 1 § 10 of the Constitution of the United States;
    “ 9: Is application of § 61-b of the General Corporation Law to this litigation in contravention of: a) § 6 of Art. 1 of the Constitution of the State of New York; b) § 11 of Art. 1 of the Constitution of the State of New York; c) § 1 of Art. 6 of the Constitution of the State of New York;
    “ 10: Is application of § 61-a of the General Corporation Law to this litigation in contravention of: a) § 6 of Art. 1 of the Constitution of the State of New York; b) § 11 of Art. 1 of the Constitution of the State of New York; c) § 1 of Art. 6 of the Constitution of the State of New York;
    “11: Is application of § 61-b of the General Corporation Law to this litigation in contravention of: a) Amendment V of the Constitution of the United States; b) Amendment XIV of the Constitution of the United States; c) Art. 1, § 10 of the Constitution of the United States;
    “12: Is application of § 61-a of the General Corporation Law to this litigation in contravention of: a) Amendment V of the Constitution of the United States; b) Amendment XIV of the Constitution of the United States; c) Art. 1, § 10 of the Constitution of the United States;
    “ 13: Was the motion of the defendant, Corn Products Refining Company for security and a stay of this action and for other relief, made pursuant to § 61-b of the General Corporation Law, properly granted?”

      Samuel Gottlieb, I. Gainsburg and Oscar Schleiff for appellants.
    I. A statute, whether classified as substantive or procedural, which establishes new rights or interferes with antecedent rights, will not be given retrospective operation, in the absence of an unequivocal expression in the enactment that it was so intended. (Hastings v. Byllesby & Co. [Granbery], 293 N. Y. 413; Matter of Berkovitz v. Arbib & Houlberg, 230 N. Y. 261; Jacobus v. Colgate, 217 N. Y. 235; Lewittes & Sons, Inc. v. Perlow, 254 App. Div. 94; E. P. Lawson Co. v. Browne, 43 N. Y. S. 2d 929.) II. Section 61-b of the General Corporation Law is not remedial but substantive in character. (Life & Casualty Co. v. McCray, 291 U. S 566; Matter of Berkovitz v. Arbib & Houlberg, 230 N. Y. 261.) III. A statute will not be given retrospective operation unless the legislative intent that it have .such effect is so clear, strong and imperative that no other meaning can be ascribed or unless the intention of the Legislature cannot be otherwise satisfied. (United States v. Heth, 3 Cranch 398; Hassett v. Welch, 303 U. S. 303; Neild v. District of Columbia, 110 F. 2d 246; People ex rel. Griffith, Inc., v. Loughman, 249 N. Y. 369; People ex rel. Beck v. Graves, 280 N. Y. 405; People ex rel. Emigrant Ind. Sav. Bank v. Sexton, 284 N. Y. 57; Waddey v. Waddey, 290 N. Y. 251.) IV. The use of the phrase “ instituted or maintained ” cannot be construed as giving this enactment retroactive effect. (Grasso v. Holbrook, Cabot & Daly Co., 102 App. Div. 49; Sonnesyn v. Federal Cartridge Co., 54 F. Supp. 29; Owens v. Greenville News-Piedmont, 43 F. Supp. 785; Burbank v. Inhabitants of Auburn, 31 Me. 590; Boutiller v. S. S. Milwaukee, 8 Minn. 97; Creditors Adjustment Co. v. Rossi, 26 Cal. App. 725; Smith v. Lyon, 44 Conn. 175; Gumpper v. Waterbury Traction Co., 68 Conn. 424; Moon v. Durden, 2 Excheq. Rep. 22.) V. New legislation will not be applied to pending cases arising before its passage where it would impose an unexpected liability that, if known, might have induced those concerned to avoid it. Eetroactive constructions are likewise to be avoided where such operation would cause a statute to work an injustice. That construction will be adopted which will avoid, rather than lead to hardship. (Lewellyn v. Frick, 268 U. S. 238.)

      Ralph M. Carson, Walter A. Dane and Samuel A. McCain for respondent.
    I. Section 61-b of the General Corporation Law is applicable to suits begun prior to the enactment thereof and is applicable to this litigation. (Weinberger v. Quinn, 264 App. Div. 405, 290 N. Y. 635; Hawes v. Oakland, 104 U. S. 450.) II. Statutes dealing with procedural matters apply to pending cases in the absence of an express intention to the contrary.
      (Fisher v. Hunter, 15 How. Prac. 156; McCann v. Bradleys, 15 How. Prac. 79; Defendorf v. Defendorf, 42 App. Div. 166, Lubkin v. Stern, 286 N. Y. 670; Sackheim v. Pigueron, 215 N. Y. 62; Laird v. Carton, 196 N. Y. 169; Compton & Co. v. Williams, 248 App. Div. 545; Eagle-Picher Lead Co. v. Mansfield Paint Co., Inc., 201 App. Div. 223; Coane v. American Distilling Company, 182 Misc. 926.) III. The terminology of section 61-b itself indicates the legislative intent that it shall apply to pending actions. (Smallwood v. Gallardo, 275 U. S. 56; Booth v. Montgomery Ward & Co., 44 F. Supp. 451; People ex rel. Collins v. Spicer, 99 N. Y. 225; Coane v. American Distilling Company, 182 Misc. 926; Matthews v. Matthews, 240 N. Y. 28; People ex rel. Doscher v. Sisson, 222 N. Y. 387; Mayor etc., v. E. A. R. R. Co., 118 N. Y. 389.)

      Nathaniel L. Goldstein, Attorney-General (Wendell P. Brown and John R. Davison of counsel), in support of constitutionality of sections 61-a and 61-b of the General Corporation Law.

      Paul A. Crouch, Clarence Fried and Franklin S. Wood for Chamber of Commerce of the State of New York, amicus curiæ, in support of position of respondents.
    I. Prior to enactment of section 61-b the abuses of stockholders’ derivative actions were widely recognized and discussed. (34 Col. L. Rev., 1308, Extortionate Corporation Litigation: The Strike Suit; 32 Mich. L. Rev. 839 [1934], Right of Minority Stockholders to Interfere in Corporate Management; 23 Cal. L. Rev. 1-8 [1934], The Securities Exchange Act of 1934, by John Hanna, Columbia University; 35 Mich. L. Rev. 597 [1937], Stockholders Suits: A Possible Substitute, by Harris Berlack; 25 Cornell Law Quarterly, 361 [1940], Stockholders’ Derivative Suits: The Company’s Role, and a Suggestion, by George T. Washington; 44 Yale L. J. 535 [1935] ; 49 Harv. L. Rev. 369, 395 [1936], Visitatorial Jurisdiction Over Corporations in Equity, by Dean Roscoe Pound, Harvard Law School; 47 Harv. L. Rev. 1327 [1934], Directors Who Do Not Direct, by William O. Douglas, Yale School of Law; Brendle v. Smith et al., 46 F. Supp. 522; Gazan v. Vadsco Sales Corporation, 6 F. Supp. 568.) II. The survey and report regarding stockholders ’ derivative suits for the Chamber of Commerce of the State of New York shows that they have constituted a type of speculative lawyer’s fee litigation in which the possible rewards are so great and the risks so slight that the least color-able claim may be worth undertaking suit upon. III. It was undoubtedly to supplement the provisions of section 61-a and to correct the misplacement of responsibility for costs effected by that section, at least in those derivative cases not showing on their face some minimum claim to representativeness, that the Legislature in 1944 enacted section 61-b of the General Corporation Law.

      H. Lewis Brown and Clyde D. Sandgren for West Virginia Pulp & Paper Company, amicus curiæ, in support of position of respondents.
    If constitutional, the legislation under attack must be applied to actions pending at the date of its enactment, since such application is not in reality to confer retrospective effect but to take the statute literally and carry out the policy that it imposes. (Smallwood v. Gallardo, 275 U. S. 56.)

      William S. Bennett and Victor House, in person, amici curiæ, in support of the position of appellants.
   Lehman, Ch. J.

Two stockholders of Corn Products Company brought derivative actions against the corporation and some of the officers and directors of the corporation to compel the individual defendants to account for and to pay back to the corporation moneys which, it is alleged, they wrongfully caused the corporation to pay to its officers, directors and employees under a profit-sharing plan, resulting in the unjust enrichment of the individual defendants “ in that they wrongfully, negligently, carelessly, fraudulently and deliberately, manipulated the accounts of Corn Products * * * by improperly computing profits before computing net profits ® The two actions were consolidated by order of the court on June 28, 1940. On July 3, 1940, an order was entered for the examination before trial of the individual and corporate defendants. That oral examination and the examination of the books of the corporation extended from July 16, 1940, to July 24, 1942. On August 13, 1942, the defendants demanded a bill of particulars of the plaintiffs’ claim. It was served on April 22, 1943. In September, 1943, the trial of the case was adjourned to the December term because of the serious illness of one of the defendants who was secretary and treasurer of the corporation. In December, 1943, the trial was adjourned to the April 1944 term at the request of .defendant’s counsel. The case was marked ready at the call of the calendar in April. It was not reached for trial in April but it was assigned for trial to the first available part of the court on May 1st.

At the time the action was instituted and until April 9, 1944, a stockholder of a corporation owning a single share of stock might institute and maintain a derivative stockholders ’ action in behalf of the corporation, incurring, if defeated in the action, only the same liability for costs which a plaintiff, owning a substantial financial interest in the corporation, would incur if defeated in a similar action; and no stockholder bringing such an action could be compelled to give security for the expenses which might be incurred by a party plaintiff or party defendant in the successful prosecution or defense of the action. By chapter 350 of the Laws of 1941 a new section (61-a) was added to the General Corporation Law providing-that in any action, suit or proceeding against one or more officers or directors of a corporation “ brought by the corporation, or brought in its behalf * * * by one or more stockholders * * * the reasonable expenses, including attorneys fees, of any party plaintiff or party defendant incurred in connection with the successful prosecution or defense of such, action, suit or proceeding shall be assessed upon the corporation ”. The effect of that statute was to impose upon the corporation the burden of paying the reasonable expenses incurred by a stockholder, who successfully prosecuted an action in behalf of the corporation, as well as the expenses incurred by an officer or director, who successfully defended himself against a charge of wrong to the corporation. No additional burden was imposed by the statute upon any individual plaintiff or defendant.

The Legislature by chapter 668 of the Laws of 1944 added a new section (61-b) to the General Corporation Law, which it is said was intended to supplement section 61-a. Under the provisions of the new section, “ in any action instituted or maintained in the right of any foreign or domestic corporation by the holder or holders of less than five per centum of the outstanding shares of any class of such corporation’s stock * * * unless the shares * * * held by such holder or holders have a market value in excess of fifty thousand dollars, the corporation in whose right such action is brought shall be entitled at any stage of the proceedings before final judgment to require the plaintiff or plaintiffs to give security for the reasonable expenses, including attorney’s fees, which may be incurred by it in connection with such action and by the other parties defendant in connection therewith for which it may become subject pursuant to section sixty-one-a of this chapter, to which the corporation shall have recourse in such amount as the court having jursidiction shall determine upon the termination of such action. The amount of such security may thereafter from time to time be increased or decreased in the discretion of the court having jurisdiction of such action upon showing that the security provided has or may become inadequate or is excessive.”

The statute adding section 61-b to the General Corporation Law became effective on April 9,1944. The defendant corporation by notice of motion dated April 13, 1944, applied to the court, pursuant to the new statute, for an order requiring the plaintiff to give the securtiy to which it is “ entitled ” under the provisions of that section if the section is valid and applies to pending actions. The defendant showed that the two plaintiffs own, together, only thirty-five shares of the common stock of the corporation, having a market value of less than $2,000, out of a total of 2,530,000 outstanding shares of common stock. The amount of plaintiffs’ financial gain will not be substantial, even if they succeed in establishing their cause of action and if the defendant corporate officers and directors are compelled to pay to the corporation the full amount of the loss which it is alleged the corporation suffered through their wrong. On the other hand, if the defendants succeed in their defense, the corporation under the provisions of section 61-a will be subject to liability for expenses of substantial amount incurred not only by itself but also by the individual defendants; and the corporation will have no recourse to the defeated plaintiffs for indemnity or reimbursement unless it is entitled to require the plaintiffs to give security as provided in section 61-b. The plaintiffs opposed the motion for an order directing them to give such security, urging that section 61-b is not intended to apply in pending actions and that it violates provisions of the Constitution of the State of New York and of the Constitution of the United States. The court at Special Term, overruling these contentions in a careful opinion, granted the motion; and the order requiring the plaintiffs to give security in the amount of $25,000 and staying proceedings of the plaintiffs in the action, has been affirmed by the Appellate Division, two justices dissenting on the ground that section 61-b is not applicable to these plaintiffs.

The Appellate Division granted leave to appeal, certifying to us thirteen questions of law. As the dissenting judges of the Appellate Division point out in their opinion, if the statute is not intended to apply in actions pending at the time that the statute took effect, the court will not reach the question whether the statute is valid when applied to actions instituted thereafter. Chapter 350 of the Laws of 1941 adding section 61-a to the General Corporation Law expressly provides that the act shall take effect immediately and shall apply to all such actions, suits or proceedings as may be pending and in which no final judgment has been made and entered at the time this act takes effect.” Chapter 668 of the Laws of 1944, which added section 61-b, provides that “ this act shall take effect immediately ” and omits the unequivocal formula used by the Legislature in enacting 61-a to indicate that the act shall apply to pending actions. The problem now presented is whether legislative intention that the act shall apply to pending actions is implicit in the statute even though not expressed in unequivocal form.

In the absence of language indicating a contrary legislative intent, a remedial and procedural statute is ordinarily applied to procedural steps in pending actions, and is given retrospective effect insofar as the statute provides a change in the form of remedy or provides a new remedy for an existing wrong. “ ‘ Where a new statute deals with procedure only, prima facie it applies to all actions — those which have accrued or are pending and future actions ’ (Sutherland on Statutory Construction, page 630) ”. (Laird v. Carton, 196 N. Y. 169, 171.) Nevertheless, as this court has -aid, The general rule is that statutes are to be construed as prospective only (27 Halsbury’s Laws of England, p. 159). It takes a clear expression of the legislative purpose to justify a retroactive application (citing cases). Changes of procedure, i.e., of the form of remedies, are said to constitute an exception (Lazarus v. Met. E. R. Co., 145 N. Y. 581, Laird v. Carton, 196 N. Y. 169), but that exception does not reach a case where before the statute there was no remedy whatever (citing cases).” (Jacobus v. Colgate, 217 N. Y. 235, 240.) In the recent case of Hastings v. Byllesby & Co. (Granbery) (293 N. Y. 413, 419), the court in considering the scope of a provision in a remedial and procedural statute that the statute should govern “ so far as practicable in cases pending when it takes effect,” said: “ the courts will not give retrospective operation to a statute which interferes with antecedent rights in the absence of an unequivocal expression in the statute that the Legislature intended that the statute should have such effect.”

The line between a procedural statute, which merely changes a form of remedy or provides a new remedy for an existing wrong, and a statute which interferes with antecedent rights or creates a remedy where none previously existed, is not always distinct. General principles may serve as guides in the search for the intention of the Legislature in a particular case but only where better guides are not available. We have said that they “ govern in default of the disclosure by the legislature of a different intent. Nice distinctions are often necessary (Jacobus v. Colgate, 217 N. Y. 235.) The word ‘ remedy ’ itself conceals at times an ambiguity, since changes of the form are often closely bound up with changes of the substance (citing cases). The problem does not permit us to ignore gradations of importance and other differences of degree. In the end, it is in considerations of good sense and justice that the solution must be found ”. (Matter of Berlcovitz v. Arbib & Houlberg, 230 N. Y. 261, 271.)

To support the argument that the statute we are considering is procedural and remedial and should be applied in actions pending when it took effect, the respondents press upon us the analogy between its provisions and provisions of other statutes regulating payment of costs or requiring in certain cases that a plaintiff furnish security for costs. The analogy is imperfect. Liability for the payment of costs and expenses in a judicial proceeding is ordinarily measured in accordance with the statute in effect at the time when costs and expenses are fixed by order or by judgment of the court, even though the proceeding may have been initiated before the statute took effect; but where that rule has been applied the purpose and effect of the statute was only to regulate costs and the statute applied alike to all plaintiffs and to all defendants in specified judicial proceedings. (Cf. Lubkin v. Stern, 286 N. Y. 670.) The statute we are considering differs from such purely procedural statutes, both in purpose and effect. We have an official declaration that it represents an effort to meet the problem created by the baseless so-called ‘ strike ’ stockholders suits against corporation directors and officers ” and that “ it does not bar any action; it does not bar any right. It simply requires that the plaintiff represent a certain minimum of interest in the corporation or that he put up security for the costs and expenses which will be incurred if his case is determined to be unfounded. ’ ’ (Memorandum of the Governor approving the legislation.) Even though it be true that the Legislature has not barred an action brought by a plaintiff who represents less than the specified minimum of interest, it has decreed, as a solution it deems reasonable of the problem created by “ baseless strike ” corporation suits, that a stockholder may maintain a suit in behalf of the corporation against its directors and officers only if he represents the “ minimum of interest ” in the corporation which in the opinion of the Legislature gives reasonable assurance that the suit is not a “ baseless strike ” suit, or if he gives security for costs and expenses for which he would not otherwise be liable and to which a plaintiff, having a larger interest, bringing the same action would not be subject. For the purposes of this discussion we assume unquestioningly that the statute is reasonably calculated to solve the problem. Nonetheless the statute creates a remedy for a wrong for which previously there was no remedy, and it interferes with the antecedent right of small stockholders to maintain derivative actions in behalf of the corporation and gives to corporations rights which they had not previously enjoyed. If the statute had been in effect when the plaintiffs instituted this action they might not have been able or willing to give the required security; if applied to pending actions it might prevent these plaintiffs from trying the action after they had spent time and money in preparing it for trial. Though the Legislature has found that the statute is a just and reasonable solution of a serious problem, it does not follow that it would decide that it would be just and reasonable to apply the statute to actions then pending. Under well established principles the statute may not be so applied unless the Legislature has disclosed an intention that it should be so applied."

It is said that, when the Legislature provided that the defendant is entitled to require the plaintiff or plaintiffs to give security ‘ ‘ in any action instituted or maintained in the right of any foreign or domestic corporation ”, it disclosed an intention that the statute should apply not only in actions thereafter instituted but also in actions previously “ instituted ” and thereafter maintained ”. The word “ maintained ” may be used in a context, where it clearly denotes that it includes pending actions. (Cf. Moore Ice Cream Co. v. Rose, 289 U. S. 373.) In other context it has frequently been given other construction. (See cases collated in 38 C. J., Maintain, §§ 2, 3, 4, 5.) In the statute we are now construing it is at most equivocal and does not, we think, disclose an intent of the Legislature that it should be applied in actions previously instituted.

Argument is also made that since section 61-b supplements section 61-a and since the Legislature when it enacted section 61-a expressly provided that the statute should apply to pending actions, we should read the same intent into the statute enacting section 61-b. Though section 61-b. in a measure supplements section 61-a, yet, as we have pointed out, it differs both in purpose and in effect. The Legislature might reasonably find that even if it be just :o make section 61-a apply to pending actions, it would be unjust to make section 61-b so apply, and we find it significant that in enacting section 61-b it omitted the formula used by it when it did decide that its companion statute should apply m pending actions. We conclude that the Legislature has not disclosed an intention that the statute should apply in actions pending when it went into effect. We consider no other question.

The orders should be reversed, with costs in all courts and the motion denied. The 1st, 3d, and 13th questions certified should be answered in the negative, and the other questions not answered. (See 294 N. Y. 840.)

Loughran, Lewis, Conway, Desmond, Thacher and Dye, JJ., concur.

Orders reversed, etc.


author: Loughran, J.

text:
    The People of the State of New York, Respondent, v. Charles Kobryn, Appellant.
    Submitted April 2, 1945;
    decided April 19, 1945.

      Charles Kobryn, appellant in person.
    I. The County Court of Monroe County was without jurisdiction in law to indict, try and convict appellant on charges he received in interstate commerce a firearm while in the premises of the United States post office at Rochester. (Ableman v. Booth, 21 How. [U. S.] 506; United States v. Cruikshank et al., 92 U. S. 542; C. M. Patten & Co. v. United States, 61 F. 2d 970; Wilson v. Shaw, 204 U. S. 24; Fort Leavenworth R. R. Co. v. Lowe, 114 U. S. 531; United States v. Unzeuta, 281 U. S. 138; Arlington Hotel v. Fant, 278 U. S. 439; United States v. Penn., 48 F. 669; General Municipal Law, §§ 210, 211; People v. Hillman, 246 N. Y. 46; Sharon v. Hill, 24 F. 726; Kohl et al. v. United States, 91 U. S. 372; Reuchelderfer v. Quinn, 53 S. C. 177; People ex rel. Hayden et al. v. City of R., 50 N. Y. 525; Matter of De Vancene, 31 How. Pr. 289; Sun Publishing Assn. v. Mayor, 8 App. Div. 230.) II. The United States Constitution (art. I, § 8, cl. 17) gives Congress the unlimited power: “ To exercise exclusive legislation in all cases whatsoever, * * * over all places purchased by the consent of the legislature of the state in which the same shall be, for the erections of forts, magazines, arsenals, dockyards, and other needful buildings ”.

      Daniel J. O’Mara, District Attorney (Stephen K. Pollard of counsel), for respondent.
    The County Court of Monroe County had jurisdiction to try the indictment. (General Municipal Law, §§ 210, 211, State Law, §§ 50, 52; People v. Vendome Service, Inc., 173 Misc. 825, 284 N. Y. 742; Adams v. United States, 319 U. S. 312.)
   Loughran, J.

Possession of a dangerous weapon without having a license therefor by one who has previously been convicted of a crime is made a felony b^ our Penal Law (§ 1897, subd. 4). After ¿ trial in the County Court of Monroe County, the defendant was found guilty of having committed that offense at a time when he was within the United States post office at Rochester, N. Y. The validity of that conviction was in due course challenged by the defendant in the Appellate Division and in this court and was upheld on both appeals. (290 N. Y. 897.)

By our leave the case has lately been resubmitted to us and now for the first time the defendant makes the point that his possession of the weapon was not an offense within the jurisdiction of this State, because (so he says) the Rochester post-office site had theretofore been ceded by the State Government to the Government of the United States. In our judgment, there is no warrant for this assertion of a transfer to the Federal Government of the authority of this State over the property in question.

Power to accept exclusive jurisdiction of land within a State for the erection thereon of structures that may be necessary to national ends is conferred upon the United States by the Federal Constitution. (Art I, § 8, cl. 17.) But the mere purchase or acquisition by the United States of land within a State for a Federal purpose does not of itself oust the State sovereignty over such land. (Fort Leavenworth R. R. Co. v. Lowe, 114 U. S. 525, 533.) In the leading case just cited, it was said (p. 531): “ The consent of the States to the purchase of lands within them for the special purposes named is, however, essential, under the Constitution, to the transfer to the general government, with the title, of political jurisdiction and dominion. Where lands are acquired without such consent, the possession of the United States, unless political jurisdiction be ceded to them in some other way, is simply that of an ordinary proprietor.” (So, Arlington Hotel v. Fant, 278 U. S. 439; People v. Hillman, 246 N. Y. 467; People v. Vendome Service, Inc., 284 N. Y. 742, 290 N. Y. 642.)

The site of the United States post office at Rochester was validly acquired by the Federal Government through condemnation. (See U. S. Code, tit. 40, §§ 258a et seq.) Article 11 of the New York General Municipal Law permits a well-nigh automatic cession to the United States of one or more pieces of land not exceeding two acres in extent which the Federal Government has acquired in any city or village of this State for the accommodation of a post office.. This need not detain iis, however, for the United States post-office property at Rochester has an area of 3.06 acres. Again, article 4 of the State Law permits a cession to the Federal Government of lands which it has acquired in this State for post-office purposes when, among other things, a ceding deed or release thereof is executed by the Governor of the State in his discretion. But no request for executive State action of that kind has in this instance been made by the Federal authorities up to this moment.

At the time or on the occasion in question, then, the State of New York had not yielded up its sovereignty over the site of the United States post office at Rochester and, that being so, this defendant was then and there subject to the sanctions of the New York Penal Law.

The judgment, as previously modified in this court, should be affirmed.

Lehman, Ch. J., Lewis, Conway, Desmond, Thacher and Dye, JJ., concur.

Judgment accordingly.


text:
    Ray Wenig et al., Respondents, v. Glens Falls Indemnity Company, Appellant.
    Argued February 20, 1945;
    decided April 19, 1945.

      Sidney J. Loeb for appellant.
    I. The policy in suit insured not only Emily V. Baker who was the “ named ” assured, but also Thomas F. Baker who was the “ additional ” assured thereunder. (Fox v. Employers’ Liability Assur. Corp., Ltd., London, 239 App. Div. 671, 243 App. Div. 325, 267 N. Y. 609; Skenandoa Rayon Corp. v. Halifax Fire Ins. Co., 245 App. Div. 279, 272 N. Y. 457; Metropolitan Casualty Co. v. Blue, 219 Ala. 37; Blackwood v. Maryland Casualty Co., 24 Ala. App. 527; Snyder v. National Union Indemnity Co., 65 F. 2d 844.) II. Any deficiency which would exist in the assured’s case against the company and any delinquency of either the named or additional assured were available to the defendant against the plaintiffs. (Weatherwax v. Royal Indemnity Co., 250 N. Y. 281; Fox v. Employers’ Liability Assur. Corp., 243 App. Div. 325, 267 N. Y. 609; Rushing v. Commercial Casualty Ins. Co., 251 N. Y. 302; Briskman v, Glens Falls Indemnity Co., 248 App. Div. 558, 251 App. Div. 319; Dileo v. Eagle Indemnity Co., 263 N. Y. 646; Devitt v. Continental Casualty Co., 269 N. Y. 474; Sarine v. American Lumbermen’s Mutual Casualty Co., 258 App. Div. 653; Snyder v. National Union Indemnity Co., 65 F. 2d 844; New Jersey Fidelity & Plate Glass Ins. Co. v. Love, 43 F. 2d 82.) III. The trial court and Appellate Division erred in ignoring the effect of Mrs. Baker’s activities in the settlement and admission of liability and in excluding evidence respecting Mr. Baker’s activities. By admitting and assuming liability and settling plaintiffs’ claims, defendant’s policy was breached, thereby precluding recovery. (Kennelly v. London Guarantee & Accident Co., Inc., 184 App. Div. 1; American Auto Ins. Co. v. Fidelity & Casualty Co., 159 Md. 631; Metropolitan Casualty Co. v. Blue, 219 Ala. 37; Whittle v. Associated Indemnity Corporation, 130 N. J. L. 576; Kindervater v. Motorists Casualty Insurance Company, 120 N. J. L. 373; Schefflin v. Title Guarantee & Trust Co., 262 App. Div. 913, 292 N. Y. 533; Levine v. Aetna Ins. Co., 139 F. 2d 217; Assurance Corp. v. Perkins, 169 Md. 269; Phoenix Cotton Oil Co. v. Royal Indemnity Co., 140 Tenn. 438; United States Casualty Co. v. Breese, 21 Ohio App. 521; Jefferson Realty Co. v. Emp. Liab. Corp., 149 Ky. 741; Coleman v. New Amsterdam Casualty Co., 247 N. Y. 271; Seltzer v. Indemnity Ins. Co., 252 N. Y. 330.) IV. The trial court erred in not submitting the defense of a breach of the policy to the jury.

      William H. George and Samuel Blonstein for respondents.
    I. The deficiency or delinquency, to be available to the defendant as a valid defense, must be of the assured against whom the judgment was recovered in the first instance. (Jackson v. Citizens Casualty Co., 277 N. Y. 385; Weatherwax v. Royal Indemnity Co., 250 N. Y. 281; Whittle v. Associated Indemnity Corp., 130 N. J. L. 576; Devitt v. Continental Casualty Co., 269 N. Y. 474; Fertig v. General Acc., Fire & Life Assur. Corp., Ltd., 171 Misc. 921.) II. The judgment having been obtained solely against Emily Baker, and not against Thomas Baker who alone entered into and signed the settlement agreement, the defense of a breach of the policy provisions applicable thereto is not available to the defendant. III. The trial court properly excluded any evidence of the settlement agreement and admissions of liability as made by Thomas Baker, and was correct in not submitting that issue to the jury. (LeLong v. Seibrecht, 196 App. Div. 74; Bouton v. Welch, 170 N. Y. 554; Hansen v. Vogelsang, 139 App. Div. 759; Smith v. Fredericks, 146 Misc. 453.)
   Lehman, Ch. J.

The plaintiff, Bay Wenig, was struck on December 18,1934, by an automobile owned by Emily Y. Baker and operated, with her consent, by her husband, Thomas F. Baker. Mrs. Wenig brought an action in December, 1936, against Emily Y. Baker and Thomas F. Baker to recover damages for the injuries which she sustained in the collision; and her husband, Budolf Wenig, joined in the action as plaintiff to recover damages arising from the loss of his wife’s services. The action was discontinued against Thomas F. Baker and thereafter in November, 1939, the plaintiff, Bay Wenig, recovered judgment against Emily Y. Baker for the sum of $3,500 and costs, and Budolf Wenig recovered judgment for the sum of $190. Execution has been returned unsatisfied.

At the time of the accident a policy was in effect which had been issued by Glens Falls Indemnity Company. Emily F. Baker was named in the policy as the assured and the company agreed to pay ‘ ‘ all sums which the assured shall become legally liable to pay for claims arising out of bodily injury ”. Under the provisions of section 109, now section 167, of the Insurance Law, an action may be maintained against the insurer “ under the terms of the policy ” for the amount of a judgment recovered against the assured in an action for damages for injury sustained or damage occasioned during the life of the policy. Accordingly after execution was returned unsatisfied the plaintiffs brought an action to recover the amount of their judgment against the assured. The judgment rendered in their favor was unanimously affirmed by the Appellate Division and the defendant has appealed by permission of this court from the judgment entered upon the order of the Appellate Division.

The insurance company disclaimed liability ‘ ‘ under the terms of the policy ” upon the ground that the assured had breached its conditions and warranties. The rule is well settled that a judgment creditor, seeking to enforce a policy insuring the judgment debtor against liability, stands in the shoes of the assured and can recover against the insurer only if the assured could recover under the terms of the policy. (Coleman v. New Amsterdam Casualty Co., 247 N. Y. 271; Weatherwax v. Royal Indemnity Co., 250 N. Y. 281; Fox v. Employers’ Liability Assur. Corp., Ltd., 243 App. Div. 325, affd. 267 N. Y. 609.) In the case we are now reviewing the defendant insurance company pleaded two affirmative defenses to the cause of action alleged in the complaint. In its first defense the defendant insurance company pleaded that in violation of the terms of the policy “ on or about the 29th day of December, 1934, the plaintiffs and said Emily V. Baker and Thomas F. Baker, without the knowledge, authority or consent of this .defendant, entered into an agreement in which the said Emily V. Baker and Thomas F. Baker voluntarily admitted liability for the accident referred to in the-complaint herein and assumed liability therefor and agreed to and did settle the same.” In its second defense the defendant pleaded: “ That the aforesaid Emily V. Baker and Thomas F. Baker, failed to give this defendant immediate written notice of the accident referred to in the complaint herein, and upon which this action is based, and failed to give this defendant any notice thereof until on or about January 4th, 1935, and not until after the assumption of liability and settlement of the claim of the plaintiffs as hereinabove set forth.”

At the trial of the action the Trial .fudge held that the defendant had failed as matter of law to establish its first defense and struck out evidence intended to connect Mrs. Emily V. Baker with the execution of a settlement agreement which was signed by her husband Thomas F. Baker. The policy required the assured to give to the company or its agent ‘ ‘ immediate written notice of any accident ”, and the Trial Judge submitted to the jury as a question of fact, only the issue whether the assured after the accident gave immediate ” written notice within the meaning of the policy. On that issue the jury found against the defendant. Upon this appeal the defendant does .not challenge that finding. The problem presented upon this appeal is whether as matter of law the evidence is insufficient to establish the first defense that the assured voluntarily admitted liability for the accident in violation of the terms of the policy.

The policy which names Emily Victoria Baker as the assured provides: “ Additional Assured. * * * this policy shall automatically be extended to cover, in the same manner and under the same conditions, as additional assured, any person or persons while riding in or using any such automobile * * * provided such use or operation is with the permission of the named assured ”. It is not disputed that Thomas F. Baker was operating the automobile at the time of the accident with the permission of his wife and that the policy automatically was extended to cover him as an additional assured ”. There can be no doubt, too, that the defendant established that Thomas F. Baker signed a formal agreement with the plaintiff Bay Wenig, dated December 29,1934, -wherein Thomas F Baker agreed to pay $900 in full settlement and satisfaction of all claims which Bay Wenig might have by reason of the accident. The agreement begins with the recital that:££ whereas the party of the second part has, on or about the 18th day of December 1934, received serious injuries due to an accident in which the party of the first part by driving his motor vehicle in a negligent manner struck the'party of the second part while said party of the second part was lawfully standing at a bus station situated at Old Country Boad near Franklin Avenue, in Mineóla, New York ”.

The coverage of the policy of insurance which the plaintiffs are seeking in this action to enforce is (1) Bodily Injury. To Pay within the limits specified in Declaration 6, all sums which the assured shall become legally liable to pay for claims arising out of bodily injury, including loss of services, and including death at any time resulting therefrom (excluding loss by liability accepted by the assured, in contract or otherwise) suffered or alleged to have been suffered by any person or persons not hereinafter accepted ”. That, coverage is subject to ££ the following conditions ”, among others: ££ F. * * * The assured shall not interfere in any way respecting any negotiations for the settlement of any claim or suit, nor in the conduct of any leg^l proceedings, but shall, at all times, at the request of the company, render to them all possible co-operation and assistance. The assured shall not voluntarily admit any liability for an accident ”, and G. Co-operation op Assured. . The assured shall not voluntarily assume any liability, nor incur any expense, other than for immediate surgical relief, nor settle any claim except at the assured’s own cost. The assured shall not interfere in any negotiation for settlement, nor in any legal proceeding, but whenever requested by the company, and at the company’s expense, the assured shall aid in securing information and evidence, and the attendance of witnesses, and shall cooperate with the company (except in a pecuniary way) in all matters which the company deems necessary in defense of any suit or in the prosecution of any appeal.”

The settlement agreement constitutes, we assume, an unequivocal “ voluntary admission of liability ” by the additional assured, and proof of the execution of such an agreement would establish a defense to any action, brought by the additional assured or by a person who recovered a judgment against the “ additional assured ”, to enforce the liability of the insurer to such assured. In this case, the plaintiffs are not seeking to enforce the obligation of the insurer to the “ additional assured ”, and they do not stand in his shoes. Under the terms of the policy the insurance company agreed to insure the “ named assured ” against liability for damages which the named assured is legally liable to pay.” The liability of the insurance company upon its promise to insure the named assured ” is neither extended nor limited by the fact that under the terms of the policy it assumed an obligation also to insure the “ additional assured ” against liability for damages for which he might become liable.

In an action to enforce the liability of the ‘ ‘ named assured ’ ’ an admission of liability by the additional assured ” would not be binding upon the named assured ” or competent evidence against her unless she joined in that admission. The primary purpose of the clauses of the policy upon which the insurance company relies is (1) to limit the coverage of the policy, as therein defined, to sums for which the assured, either named or additional, becomes “ legally liable ”, and to exclude from the coverage sums for which the assured becomes liable because he chooses to “ accept ” liability; (2) to give to the insurance company the right to direct or control all litigation arising upon any claim against the assured which is covered by the policy; and (3) to constrain the assured in such case to co-operate in good faith with the insurance company in the defense of such a claim. (Cf. G. A., Fire & Life Ass. Co. v. Louisville H. Tel. Co., 175 Ky. 96.) The breach of condition or warranty by one assured does not defeat a cause of action to enforce an obligation of the company to another assured to pay all sums which that assured shall become liable to pay. The reason is not that the breach of condition or warranty by one assured does not, of itself, prejudice the insurance company in its defense against a claim of liability asserted against another assured; for under the terms of the policy a breach of an express condition or warranty by an assured establishes a defense to the cause of action to enforce the obligation of the company to that assured even where it does not appear that the breach prejudiced the insurer. (Amer. etc. Ins. Co. v. Fid. & Cas. Co., 159 Md. 631; Brodsky v. Motorists Casualty Ins. Co., 112 N. J. L. 211, affd. 114 N. J. L. 154.) The reason is that under the terms of the policy, reasonably construed, the obligation of the company to each assured is separable and a breach of condition or warranty by one assured does not terminate the obligation of the company to another assured. No case has been called to our attention where a similar policy received any other construction.

The question remains whether there is any substantial evidence that the named assured joined in the admission of liability by her husband, and herself breached the conditions or warranties annexed to the obligation which the insurance company assumed for her benefit and which the plaintiffs seek in this action to enforce. On December 18th, when the accident occurred in which the plaintiff Bay Wenig was injured, a premium payable under the terms of the policy on November 7th was still unpaid and the assured ‘erroneously assumed that the policy was no longer in effect. On January 3d, however, Mrs. Baker received a bill for the unpaid premium and then paid the bill and gave notice of the accident to the agent of the company. In the meanwhile the settlement agreement with Mrs. Wenig had been executed, and though it is signed only by Thomas F. Baker, the additional assured, the evidence sufficiently shows that Mrs. Baker joined in the discussions which preceded the execution of the agreement. Indeed, Mrs. Baker on January 7th signed a statement, prepared by the insurance company that “ I executed an agreement to pay the insured lady $900.00 over a period of 14 months ”, though the insurance company does not seriously claim that in fact she executed it.

Evidence was introduced from which the inference might fairly be drawn that Mr. Baker did not dispute that Mrs. Wenig’s injuries were caused by his negligence, but it does not appear that either he or Mrs. Baker conceded that at the time of the accident he was operating the automobile with the consent of his wife, who owned the car, or that she was liable for the consequences of his negligence. The policy forbids the assured to “ voluntarily admit any liability for an accident ” or to “ assume any liability ”. “ A mere admission of conduct class-able as negligent ” does not in itself constitute “ an assumption of liability.” (Kindervater v. Motorists’ Casualty Ins. Co., 120 N. J. L. 373.) An admission that a person is at fault in this action, may be made with intent to admit liability for the accident.” Then it constitutes a breach of condition or warranty in a policy which prohibits an admission of liability. (Amer. etc. Ins. Co. v. Fid. & Cas. Co., 159 Md. 631, supra; Brodsky v. Motorists Casualty Ins. Co., 112 N. J. L. 211, affd. 114 N. J. L. 154; Kindervater v. Motorists’ Casualty Ins. Co., supra.) It is not such a breach where it is merely an honest statement of the facts made without intent to abandon the right to contest a claim of liability based on the facts as they may exist. (U-Drive-It Car Co. v. Freidman, 153 So. 500, La. Court of Appeal. See, also, Cadeddu v. Mt. Royal Ass’ce Co. [1929], 2 Dominion L. R. 867 [British Columbia] ; England v. Dominion of Canada Gen’l Ins. Co. [1931], 3 Dominion L. R. 489 [Ont. Supreme Court]; Tison v. Lapierre & United Province Ins. Co. [1938], 4 Dominion L. R. 816 [Quebec Supreme Court].)

The purport and effect of words and acts often depend upon their setting. Words and acts must be given effect in accordance with the meaning which they then convey to reasonable men. No rigid formula will measure or determine that. The defendant insurance company does not claim that the named assured refused to cooperate with it in the defense it planned to make if a claim were asserted against her. The problem, in final analysis, is whether by joining in the negotiation which resulted in the settlement agreement signed by her husband and by anything she said or did in that connection, she voluntarily assumed or admitted personal liability for damages resulting from the accident which her husband admitted was due to his fault. We find the evidence insufficient as matter of law to sustain an inference that she did admit such liability. Giving to the defendant insurance company — as we must — the benefit of the most favorable inference which can be drawn from the evidence, it might, perhaps, be said that the named assured joined in the agreement signed by her husband, that the claim against him should be settled by his payment of $900, but no conclusion can be drawn reasonably from that premise that she thereby assumed or intended or was understood to intend to assume or admit her own liability for the accident and to abandon or disclaim a right to interpose any defense which she would otherwise have if a claim of liability should thereafter be asserted. Nothing that she did could affect her right or the right of the insurance company to contest a claim against her or embarrass the company in the defense of such a claim. There was no breach by her of any express condition or warranty annexed under the terms of the policy to the obligation of the company to insure her.

The judgment should be affirmed, with costs.

Loughran, Lewis, Conway and Dye, JJ., concur; Desmond and Thacher, JJ., dissent and vote to reverse and grant a new trial on the ground that the evidence offered by defendant raised a question of fact as to whether or not the named assured breached conditions F and Gr of the policy.

Judgment affirmed.


author: Per Curiam.

text:
    In the Matter of the Claim of William E. Bergman, Deceased, et al., Respondents, against Mergenthaler Linotype Company et al., Appellants. State Industrial Board, Respondent.
    Argued April 6, 1945;
    decided May 17, 1945.

      John M. Cullen for appellants.
    That the Appellate Division has no power to weigh the testimony adduced before the Industrial Board, or to constrain the Industrial Board to accept or reject it has been determined with finality in several outstanding cases and is well settled law. (Daus v. Gunderman & Sons, Inc., 283 N. Y. 459; Matter of Volinsky v. Reliable Waste & Rag Co., 291 N. Y. 224; Matter of Dubinsky v. Kofsky, 266 N. Y. 631; Matter of Chetney v. Manning Co., 273 N. Y. 82; Matter of Kiriloff v. A.G.W. Wet Wash Laundry, 282 N. Y. 466; Matter of Petak v. Macy & Co., 254 App. Div. 617.)

      Nathaniel L. Goldstein, Attorney-General (Roy Wiedersum and Orrin G. Judd of counsel), for State Industrial Board, respondent.
    The decision of the Appellate Division on the first appeal was not a reversal on disputed facts. It did not determine the question of liability. The State Industrial Board reconsidered the case after the reversal and made new findings of fact. (Matter of Culver v. Sevilla Home for Children, 266 App. Div. 705, 266 App. Div. 760, 290 N. Y. 930; Matter of Heimroth v. Elk Transportation Co., 263 App. Div. 917, 288 N. Y. 716; Callan v. State Highway Department, 293 N. Y. 743; Matter of Sleight v. Harris Structural Steel Co., Inc., 267 App. Div. 842, 292 N. Y. 726.)

      John J. Scully and Harold S. Van Schaack for claimants, respondents.
    I. The order of the Appellate Division entered upon the earlier appeal did not determine the question of liability. (Matter of Daus v. Gunderman & Sons, Inc., 283 N. Y. 459.) II. The award made by the Industrial Board was proper as a matter of fact and law. (Matter of Culver v. Sevilla Home for Children, 266 App. Div. 705, 290 N. Y. 930; Matter of Green v. Geiger, 280 N. Y. 610; Matter of Falk v. Midland Dairy Co., 273 N. Y. 616.)
   Per Curiam.

The Industrial Board having denied an award for death benefits, the Appellate Division reversed this decision and remitted the matter to the Board for further consideration. The Board thereafter, acting upon a resolution declaring its opinion that the intent of the Appellate Division was “ that the case be referred back to the Industrial Board for the purpose of making an award ”, granted an award solely upon the assumed direction of the Appellate Division, without any reconsideration of the issues previously determined in favor of the Special Fund for Reopened Cases.

Under these circumstances, we are constrained to reverse the decision of the Appellate Division affirming the award and to remit the matter to the Board for a determination of the issues. (Matter of Volinsky v. Reliable Waste & Rag Co., 291 N. Y. 224; Matter of Daus v. Gunderman & Sons, Inc., 283 N. Y. 459.)

The order of the Appellate Division and the award of the State Industrial Board should be reversed, with costs in this court and in the Appellate Division against the State Industrial Board, and the matter remitted to the State Industrial Board for determination of the issues.

Lehman, Ch. J., Loughran, Lewis, Conway, Desmond, Thacher and Dye, JJ., concur.

Ordered accordingly.