author: Lewis, J. Rippey, J.

text:
    In the Matter of David A. Fay, Appellant and Respondent. In the Matter of George W. Thompson, Respondent. In the Matter of Stephen J. Wojtkowiak, Respondent. Thomas E. Dewey, as Governor of the State of New York, et al., Respondents and Appellants.
    Argued September 9, 1943;
    decided November 18, 1943.

      Nathaniel L. Goldstein, Attorney-General (Orrin G. Judd and Wendell P. Brown of counsel), for Thomas E. Dewey, as Governor, et al., respondents and appellants.
    The existing apportionment of Senate districts is so antiquated and inequitable that elections based thereon have become a travesty on justice. (People ex rel. Carter v. Rice, 135 N. Y. 473.) The division of the State into fifty-six Senate districts is required by the only construction of the Constitution which carries out the will of the People. The fundamental purpose of the exception clause in the 1894 Constitution was to prevent the smaller counties from losing senators as a result of gains in the metropolitan counties. (Matter of Sherrill v. O’Brien, 188 N. Y. 185; Matter of Dowling, 219 N. Y. 44.) To accomplish the constitutional purpose, and to comply with this court’s ruling in the Dowling case (219 N. Y. 44), the number of senators which shall be added to the basic number of fifty must be fixed by comparison with the number the county had under the 1894 Constitution. (Matter of Sherrill v. O’Brien, 188 N. Y. 185.) The constitutional reference to the number of senators ‘‘ at the time of any apportionment ” does not mean the number before the apportionment. (Matter of Dowling, 219 N. Y. 44; Matter of Smith, 90 Hun, 568; Nichols v. Eveleth, 204 Minn. 352; Bridgman v. Dove, 3 Atkyns’ English Ch. Rep. 201; St. John v. Andrews Institute, 117 App. Div. 698, 191 N. Y. 254.) The decision of the Special Term is directly at variance with prior rulings of the Court of Appeals. (Matter of Dowling, 219 N. Y. 44.) Even if the Court of Appeals should accept the lower court’s interpretation of “ having * * * at the time of ”, the number of senators should still be fifty-six. The 1943 reapportionment law gave proper effect to the changes in county lines since 1894. (Matter of Dowling, 219 N. Y. 44; People ex rel. Henderson v. Supervisors, 147 N. Y. 1; People ex rel. Boyle v. Cruise, 197 App. Div. 705, 231 N. Y. 639.) There is no inconsistency involved in the apportionment of two senators to Nassau County. (People ex rel. Henderson v. Supervisors, 147 N. Y. 1.) The reapportionment law should not be declared unconstitutional unless it appears beyond reasonable doubt that it is impossible to reconcile its provisions with the intent of the Constitution. (People ex rel. Henderson v. Supervisors, 147 N. Y. 1; Matter of Sherrill v. O’Brien, 188 N. Y. 185; Brophy v. Suffolk County Apportionment Commrs., 225 Mass. 124; Matter of Whitney, 142 N. Y. 531; People ex rel. Boyle v. Cruise, 197 App. Div. 705, 231 N. Y. 639; People ex rel. Everson v. Lorillard, 135 N. Y. 285; Veazie Bank v. Fenno, 8 Wall. [U. S.] 533; Matter of O’Brien v. Boyle, 219 N. Y. 195; People ex rel. Jackson v. Potter, 47 N. Y. 375; Matter of Reynolds, 202 N. Y. 430; Oswego & Syracuse R. R. Co. v. State, 226 N. Y. 351.) The opponents of the bill would defeat the purpose of the exception clause, and deny full compensation to the small counties for the additional senators allocated to the larger counties. (Association for the Protection of the Adirondacks v. MacDonald, 253 N. Y. 234; Matter of Burns, 155 N. Y. 23; Matter of Wing v. Ryan, 255 App. Div. 163, 278 N. Y. 710; Matter of Sherrill v. O’Brien, 188 N. Y. 185; People ex rel. Carter v. Rice, 135 N. Y. 473.) Tn determining how many senators to add to the basic number of fifty by reason of additional senators apportioned to large counties, comparison must be made with the apportionment of 1894. (Matter of Dowling, 219 N. Y. 44.) The increased senate representation of Queens County required the addition of four senators to the basic number. (United States v. Classic, 313 U. S. 299.) There is no error in the apportionment of two senators to Nassau County. There is no error in the treatment of Westchester County. There is no violation of the principle of equality.

      David A. Fay, in person, and Saul I. Badin for petitioner David A. Fay, appellant and respondent.
    In a case brought to test the constitutionality of a reapportionment law, it is the duty of the court to revieiv the apportionment. (People ex rel. Carter v. Rice, 135 N. Y. 473; Matter of Dowling, 219 N. Y. 44.) The conclusion urged by petitioner Wojtkowiak, that the number of Senate districts to be formed upon an apportionment based upon the Federal census of 1940, and the tabulation thereof, as prescribed by the Constitútion, is fifty-three, is erroneous. (Klein v. Maravelas, 219 N. Y. 383; People ex rel. Carter v. Rice, 135 N. Y. 473; People ex rel. Wood v. Draper, 15 N. Y. 532; Rohrbach v. Germania Fire Ins. Co., 62 N. Y. 47; Matter of Goodman, 146 N. Y. 284; Matter of Madden, 148 N. Y. 136; Matter of Titus, 117 App. Div. 621; Matter of O’Brien, 117 App. Div. 628; People ex rel. Cassidy v. Whalen, 189 N. Y. 534.) There is internal inconsistency in the theory of law accepted by the Legislature in enacting chapter 359 of the Laws of 1943. Matter of Dowling (219 N. Y. 44) decided but one question regarding the number of Senate districts required to be formed, and that was that the word, “ additional,” as applied to the counties which had three or more senators in 1894, meant, * ‘ additional to the number of senators had by such county in 1894 ”. (Grenada Co. Supervisors v. Brogden, 112 U. S. 268; People ex rel. Burrows v. Supervisors, 17 N. Y. 235; People ex rel. Bolton v. Albertson, 55 N. Y. 50; Matter of Gilbert Elevated

      Ry. Co., 70 N. Y. 362; Matter of New York & Long Island Bridge Co., 148 N. Y. 540; Rumsey v. People, 19 N. Y. 41; People v. Purdy, 4 Hill 384; Crane v. Bennett, 177 N. Y. 106; Matter of Sherrill v. O’Brien, 188 N. Y. 185.) No increase shall be made in the basic fifty members of which the Constitution requires the Senate always to be composed (except when any county having three or more senators at the time of any apportionment shall be entitled on such ratio to an additional senator or senators), unless the senator or senators on whose account the increment is made are additional to three or more senators. (Matter of Dowling, 219 N. Y. 44.) The phrase “ at the time of any apportionment ”, in the exception clause of the Constitution, refers to the time when, by the application of the prescribed formula in connection with a reapportionment, the number of senators which the counties falling within the provisions of the exception will have, has been ascertained. In an apportionment based upon the Federal census of 1940, and the tabulation thereof, Queens is not a county, “ having three or more senators.” (Nichols v. Eveleth, 204 Minn. 352; Bridgman v. Dove, 3 Atkyns ’ English Ch. Rep., 201; St. John v. Andrews Institute, 117 App. Div. 698, 191 N. Y. 254.) The word, “ county,” as used in the clause, “ if any county having three or more senators,” et cetera, and in the sentence, “ no county shall have four or more senators unless it shall have a full ratio for each senator, ’ ’ means, “ county as organized in 1894.” (Matter of Dowling, 219 N. Y. 44; People ex rel. Henderson v. Supervisors, 147 N. Y. 1; People ex rel. Wood v. Draper, 15 N. Y. 532; People ex rel. Henderson v. Supervisors, 147 N. Y. 1.) In an apportionment based upon the Federal census of 1940, and the tabulation thereof, the only county having three or more senators and entitled on the ratio to an additional senator or senators, is Kings. Under any possible construction of section 4 of article III of the Constitution, on an apportionment made conformably to the adjudicated cases, and based upon the Federal census of 1940 and the tabulation thereof, the number of Senate districts must be either fifty-two or fifty-four. (Matter of Dowling, 219 N. Y. 44.) The second and third senatorial districts (comprising the county of Nassau) formed by chapter 359 of the Laws of 1943 were erected in compliance with the mandatory provisions of section 4 of article III of the Constitution. (People ex rel. Henderson v. Supervisors, 147 N. Y. 1.) Westchester is entitled to two, and only two, Senate districts, in an apportionment based upon the figures of the United States census for the year nineteen hundred forty. (People ex rel. Henderson v. Supervisors, 147 N. Y. 1; Matter of Sherrill v. O’Brien, 188 N. Y. 185.) The word, “ having ”, as occurring in the third paragraph of section 4 oE article III of the Constitution, means, “ having in 1894 ”, and the' correct number of senate districts to be formed is therefore fifty-two, since Kings is the only one of the counties then having three or more senators that gains on an apportionment based upon the census of 1940, and the tabulation thereof. (Matter of Sherrill, 188 N. Y. 185; Matter of Wing v. Ryan, 255 App. Div. 163, 278 N. Y. 710; Matter of Bickerton, 232 N. Y. 1; Tyrrell v. Mayor, 159 N. Y. 239.) The apportionment of assemblymen among the counties made by chapter 359 of the Laws of 1943 is in conformity with the provisions prescribed by article III of the State Constitution. The apportionment of senators in Senate districts numbers one to twenty-eight, thirty-two, thirty-five, forty-one, forty-three, fifty, fifty-one and fifty-three to fifty-six, is made in accordance with the provisions of the Constitution, and the said districts are constitutional, except as to the numbering thereof. (Matter of Sherrill v. O’Brien, 188 N. Y. 185; Matter of Reynolds, 202 N. Y. 430.)

      Pliny W. Williamson, in person, Thomas J. Whalen and Richard E. Enright for Pliny W. Williamson, amicus curiae, in support of constitutionality of chapter 359 of Laws of 1943.
    In Matter of Dowling (219 N. Y. 44) the Court of Appeals gave an opinion as to the manner of determining the number of Senate districts which, for the Legislature, was authoritative. ’ The Legislature followed strictly the rules thus laid down. The opinion in the Dowling case properly interpreted the purpose of the Constitutional Convention of 1894 as to apportionment! of the Senate districts. The Legislature determined the number of districts in accordance with the Dowling opinion and their distribution in accordance with the opinion in Matter of Sherrill (188 N. Y. 185). The Sherrill and Dowling cases are decisive and presumptively now part of the fundamental case. (Judd v.
      Board of Education, 278 N. Y. 200; Matter of Smith, 90 Hun, 568.)

      Fred G. Moritt, in person, and Morris Eisenstein for Fred G. Moritt, amicus curiae, in support of constitutionality of chapter 359 of Laws of 1943.
    A Senate of fifty-six pursuant to chapter 359 of the Laws of 1943 is in accord with the provisions, intent and history of the Constitution of the State of New York. (Matter of Bowling, 219 N. Y. 44.)

      Arthur M. Indell and Charles J. W. Meisel for Queens County Bar' Association, amicus curiae, in support of constitutionality of chapter 359 of Laws of 1943.
    The procedure followed by the Legislature in formulating the present act was not only efficacious but within constitutional authority. The determination of the court below is unsound. It does not uphold the fundamental purpose of the Constitution and it should not be sustained. (Matter of Bowling, 219 N. Y. 44; Matter of Sherrill v. O’Brien, 188 N. Y. 185; Matter of Burns v. Flynn, 268 N. Y. 601.) The 1943 act should be held fully valid and constitutional and the order appealed from reversed.

      Fred E. Herton, I. Robert Bassin, Victor B. Borst, Jr., and Matthew Mester for Central Queens Allied Civic Council, Allied Civics of Forest Hills and Vicinity and United Civic Council, amici curiae, in support of constitutionality of chapter 359 of Laws of 1943.
    The Reapportionment Act of 1943, increasing the membership of the State Senate from the number fifty to the number fifty-six is constitutional. (Matter of Bowling, 219 N. Y. 44; Matter of Sherrill v. O’Brien, 188 N. Y. 185.)

      John J. O’Connor for George W. Thompson, respondent.
    The holding of the Special Term that the Act is invalid and unconstitutional because “ the total number of Senators should * * * be fifty-three ’ ’, and not fifty-six, should be sustained. (Matter of Sherrill v. O’Brien, 188 N. Y. 185; Colonial City Traction Co. v. Kingston City R. R. Co., 154 N. Y. 493; People ex rel. Metropolitan Street Ry. Co. v. Tax Commissioners, 174 N. Y. 417.) The variances in the citizen population of the Senate districts are so great as to violate the provisions of the Constitution as to equality.' (Matter of Smith v. Supervisors,
      148 N. Y. 187; Matter of Sherrill v. O’Brien, 188 N. Y. 185; People ex rel. Carter v. Rice, 135 N. Y. 473.) The apportionment of the Assembly districts is not in accordance with the provisions of the Constitution. (Matter of Sherrill v. O’Brien, 188 N. Y. 185; Matter of Reynolds, 202 N. Y. 430; Matter of Dowling, 219 N. Y. 44.)

      Henry Epstein and Milton Kaplan for Stephen J. Wojtkowiak, respondent.
    The application of the constitutional provisions prescribing the method of senatorial apportionment conclusively reveals the invalidity of chapter 359 of the Laws of 1943. (Matter of Sherrill v. O’Brien, 188 N. Y. 185; Matter of Dowling, 219 N. Y. 44.) Appellants commit the error of including Nassau County in both allotments — in the metropolitan category to add to Queens for their purpose of reaching fifty-six, and then whisking Nassau over to the rural class and noting that Nassau can accommodate two of the secondary ratios. About twenty-two square miles, with approximately 300,000 citizen population by the 1940 Federal census, were taken from Westchester and added to what is now Bronx County in 1895, the year after the 1894 apportionment (L. 1895, ch. 934). If the Westchester of 1894 is to be recreated, this will afford a full three ratios to Westchester. The mandate of section 4 of article III, that Senate districts must attain as exact equality in citizen population as reasonably possible, is violated by the 1943 apportionment. (Matter of Sherrill v. O’Brien, 188 N. Y. 185.)
   Lewis, J.

A challenge to the constitutional validity of the present reapportionment statute of this State (L. 1943, ch. 359) has been sustained at Special Term. That challenge, although varying in minor details, is common to the three proceedings captioned above which have been consolidated and come before us by direct appeal. (Civ. Prac. Act, § 588, subd. 4.)

The question presented is whether the Legislature of 1943 acted within constitutional limitations when it directed the reapportionment of Senate and Assembly districts according to the provisions of chapter 359 of the Laws of 1943.

The inquiry thus required of us must proceed with proper regard for the settled rule that a presumption of constitutionality attaches to every statute enacted by the Legislature and ‘ ‘ * * * that a statute can be declared unconstitutional only when it can be shown beyond reasonable doubt that it conflicts with the fundamental law, and that until every reasonable mode of reconciliation of the statute with the Constitution has been resorted to, and reconciliation has been found impossible, the statute will be upheld.” (People ex rel. Henderson v. Board of Supervisors, 147 N. Y. 1, 15, 16; People ex rel. Garter v. Rice, 135 N. Y. 473, 484, 500, 501; Matter of Sherrill v. O’Brien, 188 N. Y. 185,196-199.) In our effort to determine whether the statute in question conforms with the requirements of the Constitution we must give to the latter instrument practical effect, having in mind the purpose of the body which framed it and the people who adopted it. (Matter of Burns, 155 N. Y. 23, 30; Association for the Protection of the Adirondacks v. MacDonald, 253 N. Y. 234, 238.)

The importance to State government of the apportionment of Senate and Assembly districts has given that controversial subject a prominent place in the constitutional and legislative history of this State. In an effort, however, to confine this opinion to facts which relate themselves to the problem presented, we pass the earlier history of apportionment and come at once to the Constitution of 1846 which divided the State into thirty-two Senate districts, but made no provision to adjust Senate representation either to the future growth of the State or to possible future shifts of population from rural to urban districts. In 1846 the citizen population of the State was 2,450,778; in 1892 it had increased to 5,790,865. Although that increase was reflected to some extent in rural districts, the major portion of the increase had been in the cities. It thus came about in 1894 that a marked increase of population in the metropolitan areas caused the Constitutional Convention of that year to propose amendments to the Constitution which were adopted later and are effective today, the interpretation of which will be determinative of this appeal.

The record of the proceedings of the Constitutional Convention of 1894 gives clear proof that when the subject of reapportionment was under consideration the delegates were often reminded of the disparity in size and population between rural and urban Senate districts. They were also reminded that, under the then existing inflexible constitutional limit of thirty-two Senate districts, any increase in urban representation — which manifestly was due because of the marked gain in urban population — would necessarily cause a corresponding reduction in the representation of rural districts. These suggestions came forth at times when the debates made reference to the underlying constitutional principle in this State that the Legislature should be authorized and directed to reapportion the State at certain intervals and according to a plan by which the Senate and Assembly districts should enjoy, as nearly as might be accomplished, equal representation in proportion to population, excluding aliens. Experience had apparently demonstrated, however, that exact equality in the apportionment of legislative representation on the basis of population was made impossible by practical considerations, some of which were recognized by the Constitution itself — such as the maintenance of county, town and block lines as district boundaries and the preservation of a relation between county autonomy and representative districts. (See People ex rel. Henderson v. Board of Supervisors, supra, pp. 16, 17.)

In our search to ascertain the purpose of the framers of the constitutional amendments proposed and adopted in 1894, presently to be considered, we gain accurate information from a portion of the “ Address to the People ” adopted at the close of its session by the Constitutional Convention of that year:

We have provided for a new apportionment of Senate and Assembly districts, and for that purpose have fixed the number of the Senate at fifty and that of the Assembly at 150. * * *

Since 1846 the great increase of population in the cities, entitling them to additional representation in the Senate, has required a corresponding decrease in the representation of the country districts, so that those districts have been constantly enlarged and their representation in the Senate has been constantly decreased. The object of the proposed increase is to restore the country districts to substantially the same position in which they were in 1846, and to provide for the increased representation of the cities by the increase in number, so that there will be effective representation of the country as well as of the city districts.” (Revised Record, Constitutional Convention of 1894, Yol. IV, pp. 1253-1254.)

The Constitution proposed by the convention of 1894 was adopted by the People. Since that time none of the provisions which establish the fundamental laiv governing reapportionment of the State has been amended save that provision dealing with the enumeration of inhabitants. That change occurred in 1931 when an amendment was adopted which eliminated from article III, section 4, the provision for a State census, except in certain events there described, and made the Federal census of 1930 and each Federal census taken decennially thereafter the bases for future State reapportionments.

After providing in article III, sections 2 and 3, that Senate districts in the State be increased from thirty-two to a minimum of fifty — which later provision, for the purposes of our present consideration, may properly be treated as having fixed in 1894 the basic number of Senate districts — the Constitution, under article III, section 4, then made provision and still provides for future readjustments and reapportionments of Senate districts by the Legislature. Directions are set forth for the enumeration of inhabitants, and those times are specified when Senate districts shall be “ readjusted or altered.” Then follow, under the same section, certain limitations upon the performance by the Legislature of the function of reapportionment — limitations which tend to make impossible the attainment of exactitude in reaching equality of representation in the apportionment of Senate districts on the basis of population:

“ * * * Such districts shall be so readjusted or altered that each senate district shall contain as nearly as may be an equal number of inhabitants, excluding aliens, and be in as compact form as practicable, and shall remain unaltered until the first year of the next decade as above defined, and shall at all times consist of contiguous territory, and no county shall be divided in the formation of a Senate district except to make two or more Senate districts wholly in such county. No town, and no block in a city inclosed by streets or public ways, shall be divided in the formation of Senate districts; nor shall any district contain a greater excess in population over an adjoining-district in the same county, than the population of a town or block therein adjoining such district. Counties, towns or blocks which, from their location, may be included in either of two districts, shall be so placed as to make said districts most nearly equal in number of inhabitants, excluding aliens.

“ No county shall have four or more senators unless it shall have a full ratio for each senator. No county shall have more than one-third of all the senators; and no two counties or the territory thereof as now organized, which are adjoining counties, or which are separated only by public waters, shall have more than one-half of all the senators.”

Finally we reach that paragraph of article III, section 4, the interpretation of which has given rise to the present controversy. That paragraph, as we have seen, is one of the constitutional provisions proposed by the convention of 1894, the object ” of which was declared by that convention to be — “ to restore the country districts * * *, and * * * provide for the increased representation of the cities by the increase in number [of districts], so that there will be effective representation of the country as well as of the city districts.” That objective was obtained by the following provision: Article III, section 4. “ * * * The ratio for apportioning Senators shall always be obtained by dividing the .number of inhabitants, excluding aliens, by fifty, and the Senate shall always be composed of fifty members, except that if any county having three or more Senators at the time of any apportionment shall be entitled on such ratio to an additional Senator or Senators, such additional Senator or Senators shall be given to such county in addition to the fifty Senators, and the whole number of Senators shall be increased to that extent.”

By anticipating a further increase in the urban population the convention of 1894 proved to be prophetic. Between 1894 and 1940 the citizen population of the State increased from 5,790,865 to 12,401,329. The major portion of that increase was in the cities — the City of New York alone having attained in 1940 a population of 6,632,398. In the meantime four reapportionment statutes were enacted by the Legislature, the last within that period being in 1917. (L. 1917, ch. 798; State Law, §§ 120-122.)

We come then to the present reapportionment statute (L. 1943, ch. 359), which has been declared unconstitutional at Special Term. By its enactment the Legislature, in an effort to give effect to the constitutional provisions governing reapportionment, has reapportioned the State into fifty-six Senate districts — a gain of six districts over the basic number of fifty fixed by the Constitution of 1894. We must assume that increase in Senate representation was adopted after effect was given in good faith to each limitation upon the legislative function of reapportionment found in article III, section 4, of the Constitution. To that end the Legislature pursued the following method hy which it determined fifty-six to be the total number of districts into which, under the Constitution, the State might he reapportioned:

According to the Federal census of 1940 the citizen population of the State was 12,401,329. Applying to that figure the divisor fifty (being the minimum number of Senate districts fixed by article III, section 2) gave the quotient 248,027. Having thus found the quotient which is commonly termed the first ratio, and after determining that the five most populous counties — Kings, New York, Bronx, Queens and Brie — were entitled to “ three or more Senators,” the next requirement was to ascertain the total number of senators to which each of those five counties was entitled. That requirement was met hy dividing the citizen population of each of the five counties hy the first ratio, thereby producing a quotient in terms of full ratios which, under the Constitution (art. Ill, § 4), represented the total number of senators to which each of the five counties was entitled, plus an excess appropriate to each equation. This formula, when applied to the five counties mentioned above, produced the following results:

1,615,980 (Citizen pop.) New York Co.--=6 full ratios (Senators) +127,818 excess 248.027 (First ratio)
1,241,269 (Citizen pop.) -=5 full ratios (Senators) +1,134 excess 248.027 (First ratio) Bronx Co. —
1,203,752 (Citizen pop.) -=4 full ratios (Senators) +211,644 excess 248.027 (First ratio) Queens Co. —
765,073 (Citizen pop.) Brie Co.--=3 full ratios (Senators)+20,992 excess 248.027 (First ratio)

To determine under article III, section 4, the number of “ additional ” senators, if any, which should be apportioned to each of the five counties “ having three or more Senators at the time of [the] apportionment,” the Legislature compared the total number to which each county was entitled with the number apportioned to each county’s territory by the Constitution of 1894. In passing it may be said that it is this comparison which has provoked the chief disagreement between the appellants and respondents and is a subject presently to be considered.

The comparison with the basic apportionment of 1894 adopted by the Legislature served to increase by two the number of senators which should be apportioned to Kings County. When applied to the county of New York, which in 1894 included Bronx County, the comparison warranted a decrease in the number of senators from twelve to eleven. That deduction, however, was not made in the reapportionment because the exception clause in article III, section 4, contained no provision for a decrease in the whole number of senators. In the territory comprising Queens County the citizen population, on the basis of four full ratios, entitled that county to four senators. The comparison with conditions dealt with by the convention of 1894 showed that in that year the territory which then comprised Queens County alone and formed a single district with one senator, now includes Queens and Nassau Counties. Nassau County, by the Federal census of 1940, had a population of 383,266. It thus has one full ratio which entitles it to one senator. By comparing the Queens-Nassau territory of 1943, then entitled to five senators, with the same territory in 1894, to which one senator was then apportioned by the Constitution of that year, the Legislature of 1943 apportioned four additional senators to that Queens-Nassau territory. Erie County, which had three senators in 1894, failed to show an increase sufficient to equal four full ratios and, accordingly, the number of senators to which it is entitled remains three. It is by the above method of computation, whereby Kings and Queens Counties are found to have three or more senators and show gains of two and four senators respectively, that the reapportionment of 1943 increased the whole number of senators to fifty-six.

To complete the reapportionment in the entire State the Legislature applied what is known as a second ratio. (See Matter of Sherrill v. O’Brien, supra, pp. 208-209.) By the application of the first ratio to the five larger counties having a total citizen population of 7,233,558, the Legislature has apportioned to those counties, in the manner outlined above, a total of twenty-seven senators. On the basis of full (first) ratios no one of the fifty-seven remaining counties has a citizen population which entitles it to three or more senators. Accordingly, having apportioned twenty-seven senators to the citizen population of 7,233,558 in five counties, and having increased the whole number of senators to fifty-six, the Legislature then apportioned the remaining twenty-nine senators to the remaining fifty-seven counties by dividing the total citizen population of those counties (5,167,771) by twenty-nine (being the number of remaining senators to be apportioned to fifty-seven counties), thus producing a quotient — the second ratio — of 178,199. When the second ratio was applied to the population of each of the fifty-seven remaining counties, it was found that seven of those counties were entitled to one or more senators as follows: Albany, 1; Monroe, 2; Nassau, 2; Oneida, 1; Onondaga, 1; Suffolk, 1; Westchester, 3. A total of eleven senators out of the twenty-nine subject to the second ratio having thus been apportioned to seven counties out of fifty-seven, the balance of eighteen Senators was then apportioned to the fifty counties remaining.

In deciding that the reapportionment statute of 1943 is not consonant with the Constitution, Special Term reached the conclusion that a correct reapportionment upon the present record called for an increase of three in the whole number of senators, thus bringing the membership of the Senate to fifty-three. In doing so the court gave one additional senator to Kings County and two to Bronx County. No gain in the senatorial representation of Queens County was deemed legally justified because, it was ruled, that county was not one of those which had three or more senators before the time of reapportionment. In reaching those conclusions the court construed the clause any county having three or more Senators at the time of any apportionment ” (art. Ill, § 4), as meaning a county having three or more senators before the reapportionment. The court also ruled that — the number of senators which a county in the class of ‘ three or more senators at the time of any apportionment ’ has after the reapportionment should be compared with the number it had before the reapportionment ” (179 Misc. 1062, 1071) — which, we assume, in this instance referred to the reapportionment of 1917. (L. 1917, ch. 798.)

We think the ruling at Special Term failed to heed statements made in the opinion of Matter of Dowling (219 N. Y. 44), in which proceeding, as we shall point out, there came before this court for consideration problems substantially the same as those in the present case. In the Dowling case cross appeals by all parties had brought to this court an order of the Appellate Division in a proceeding to test the constitutionality of the reapportionment act of 1916. (L. 1916, eh. 373.) For our present purposes it is important to note the text of the order of the Appellate Division, which was then made the subject of review in this court. The Appellate Division order provided:

“It is hereby ordered and adjudged that the order so appealed from be reversed on the law and the apportionment declared invalid in so far as it provides for fifty-one senators and allots two senators instead of one to Westchester County, and valid in all other respects. And it is

“ Further ordered and adjudged that the Secretary of State, in sending out his notice of election for the forthcoming General Election, as required by Section 293 of the Election Law shall include and direct in such notice that but one State Senator shall be elected for and from the County of Westchester; and that as to all other Senatorial districts in the State of New York, the notice so to be sent out shall be in accordance with the provisions of Chapter 373 of the Laws of 1916.”

The Appellate Division’s opinion (174 App. Div. 185) outlined the principal problem considered, by stating —“ The Apportionment Act provided for fifty-one Senators. The appellants claim that the total number of Senators should be fifty and not fifty-one.” The opinion concludes with the statement — “ The orders appealed from should, therefore, be reversed on the law and the apportionment declared invalid in so far as it provides for fifty-one Senators and allots two instead of one to Westchester county, and valid in all other respects.” Thereafter, upon appeal to this court, the briefs of counsel placed emphasis upon the issue which had been tendered for. decision in the Appellate Division. The brief by the Attorney-General on behalf of the appellants stated — “ The question then presented is whether we are to use the constitutional, apportionment of 1894 or the legislative apportionment of 1907 as the basis of determining whether an additional Senator in excess of 50 is allowable under the Constitution.” The second point briefed by counsel for the respondents was captioned “ The Senate should consist of fifty and not fifty-one members, as provided in the Act under review. ’ ’ Finally, the opinion of this court (at p. 51) states the first question of law presented by the appeal to have been — “ 1. Upon the facts disclosed by the record, should the senate be composed of fifty, or fifty-one members?”

True it is that in the Dowling case this court declared the 1916 apportionment unconstitutional because of an error in the formation of certain designated Senate districts in New York County. It did not reach that decision, however, until it had considered and expressly decided the issue which was deter- ' mined by the Appellate Division order and presented to this court for review, and which had been denominated by this court as the first of the questions of law presented by the appeal. A statement made by the Supreme Court of the United States in Railroad Companies v. Schutte (103 U. S. 118, at p. 143), applies here with equal force: “ It cannot be said that a case is not authority on one point because, although that point was properly presented and decided in the regular course of the consideration of the causé, something else was found in the end which disposed of the whole matter. Here the precise question was properly presented, fully argued, and elaborately considered in the opinion.” (See, also, Union Pacific R. R. Co. v. Mason City & Fort. Dodge R. R. Co., 199 U. S. 160, 166; United States v. Chamberlin, 219 U. S 250, 262; Rohrbach v. Germania Fire Ins. Co., 62 N. Y. 47, 58, 59.)

The following excerpt from the opinion in the Dowling case (supra) states not only this court’s view as to how essential to the issue then sub judice was the construction of article III, section 4, of the Constitution, but also gives the court’s interpretation of those provisions of the Constitution which were followed by the Legislature in 1943 in reapportioning the Senate and are now in controversy before us (pp. 55-56): “It is necessary to determine in connection with the provision in the Constitution for ‘ an additional senator or senators ’ some specific time from which the computation must be made to ascertain whether an additional senator or senators are permitted within its terms. A construction of the language of the Constitution is essential. It should not be given a construction that leads to manifestly unintended results. If the Constitution is construed to mean that the additional senator or senators must be determined in comparison with the number of senators provided by the Constitution itself, the purpose and intent of the People of the State will be carried out. If the number of senators by the ratio is not compared with the number of senators as of the time of the adoption of the Constitution itself the purpose and intent of the people will be frustrated. In the construction of a statutory or constitutional provision a meaning should not be given to words that are the subject of construction that will defeat the purpose and intent of the statutory provision or that will make such provision absurd.

“ The words of the Constitution, namely, ‘ time of any apportionment,’ are important to put a limit upon all changes in the number and apportionment of senators. They do not necessarily fix the time from which to compute the number of additional senators, if any, to which a county is entitled. When at the time of any apportionment the number of senators by the ratio, as provided, is determined all the counties then entitled to three or more senators are to have the number of senators to which they are so entitled compared toith the number of senators given to such county by the Constitutiton of 1894, and if by the ratio any county is entitled to an additional senator or senators such additional senator or senators must be given to such county, and the number of senators in the State must be increased accordingly. Such interpretation respects all of the provisions of the Constitution.

. We do not think that the Constitution was violated in dividing the State into fifty-one senate districts.” (Emphasis supplied.)

We have not been persuaded that the interpretative statements last quoted above are irrelevant to the decision we are about to make; nor do we agree with counsel for some of the respondents that they contain an erroneous interpretation of provisions of the Constitution which are applicable to the proceeding now before us. We have seen that as an incident to a decision' of issues then presented for review, the court, in the Dowling case deemed it — “ necessary to determine in connection with the provisions in the Constitution for ‘ an additional senator or senators ’ some specific time from which the computation must he made to ascertain tvhether an additional senator or senators are permitted within its terms.” (Emphasis supplied.) That problem now comes to us as a submission by all parties and presents the principal question for decision. As in the Dowling case the court expressly found “ A construction of the language of the Constitution [to be] essential ”, so in the case at bar an interpretation is required of the same provisions of the Constitution.

The language employed in article III, section 4, of the Constitution, when considered in the light of constitutional history in this State as it relates to reapportionment, has led us to accept the statement quoted above from the Doivling case as containing an authoritative interpretation of the constitutional provisions .which are involved in the present proceeding. Accordingly we conclude that, in the process of reapportioning Senate districts in 1943, the Legislature acted in conformity with the constitutional purpose. To that end, after a correct application of the constitutional ratio, it computed the additional Senator or Senators ’ ’, if any, to which any county having three or more Senators at the time of [the] apportionment ” was entitled, by comparing the total number to which each such county was so entitled with the number that had been apportioned to that county’s territory by the Constitution of 1894, and by increasing the total number of senators accordingly — any increase over the total Senate membership of 1894 being added to the basic fifty.

Concededly the territories of Queens County and Nassau County in 1894 comprised one district to which one senator was then apportioned. At the time of the 1943 reapportionment the population Avithin that territory, which now comprises Queens and Nassau Counties, had increased to a figure in excess of five full first ratios and thus became entitled to five senators — Queens County having in excess of four full ratios and Nassau having in excess of one full ratio. There Avas thus a gain of four senators in that territory which, under the Constitution of 1894, was a single district. In the determination of the number of senators to which Nassau and Westchester Counties were entitled at the time of the 1943 apportionment, the application of the first ratio could not be made because neither county had three or more full (first) ratios. It was in these circumstances that the Legislature used the second ratio applicable only to the reapportionment of those counties in the State which do not have three or more full (first) ratios. By the application of the second ratio to Nassau and Westchester Counties they became entitled to two and three senators respectively. In thus dealing with the problems of readjustment and reapportionment peculiar to Queens, Nassau and Westchester Counties and by applying the ratio, approved by this court in Matter of Sherrill v. O’Brien (supra), pp. 208, 209, we think the Legislature has not enacted a statute which beyond reasonable doubt * * * conflicts with the fundamental law.” (People ex rel. Henderson v. Board of Supervisors, supra, p. 16.)

We have considered also the criticism directed by one of the petitioners to the reapportionment of members of the Assembly — approved at Special Term — and all other matters to which the briefs of counsel direct our attention. Our conclusion is that the reapportionment act of 1943 is in accord with the Constitution.

It follows that the order of the Special Term should be reversed and the petitions dismissed, without costs.

Rippey, J.

(concurring). Although the decision in Matter of Dowling (219 N. Y. 44) was based upon another ground, the rule formulated by Judge Chase and concurred in by a majority of the judges of this court on the subject of the reapportionment of Senate districts on which reliance is placed in the main opinion here was probably intended by the court as a guide for the Legislature in enacting future reapportionment statutes. Under circumstances appearing in this case, it may not be lightly rejected as dictum. Were those circumstances not present, it could have no more force upon later decisions than mere dictum in any case.

Grave difficulties arise in an attempt to reconcile the rule so formulated with the language of the Constitution. It is important to note that no bill or resolution for reapportionment applying that rule as now applied in the present Act reached the floor of the Legislature for twenty-five years after that opinion was written. Yet the Constitutional Convention of 1938 had seriously before it the question of revision of the constitutional provision of 1894 relating to reapportionment, as well as its construction in this court through the dictum in the Dowling ease and made no change and the People ratified the act of the Convention. When the Legislature in 1943 enacted chapter 359, it followed the interpretation of the constitutional provision as announced in the Dowling case. Whether that interpretation was correct or incorrect when made, the Legislature was not without justification in following it subsequent to' the action of the Constitutional Convention of 1938 and the adoption by the People of the provision of that Constitution relating to reapportionment. In that view of the matter, though with great hesitation, I accept the construction placed upon the language of the Constitution by the majority of this court in the Dowling case, and, so far as the rule there formulated can be applied, I concur in the decision that the apportionment of 1943 is valid. As affecting future reapportionment, that rule may he promptly changed hy appropriate constitutional amendment if the People so desire.

Problems arising through the change in the territorial boundaries of New York, Queens and Westchester Counties and the creation of the counties of Queens and Nassau since 1894, were not open for decision nor considered in the Dowling case and are not affected by it. Nor did the framers of the Constitution provide for the situation thus presented in express terms. However, I cannot say that the statute enacted by the Legislature in treating those problems and other problems presented to it conflicted, beyond reasonable doubt, with the fundamental law.

The order appealed from should be reversed, without costs, and the several petitions dismissed.

Lehman, Ch. J., Loughran, Desmond and Thacher, JJ., concur with Lewis, J.; Rippey, J., concurs in separate opinion in which Conway, J., concurs.

Order reversed, etc.


source: Caselaw Access Project

author: Lewis, J.

license: Public Domain

text:
    In the Matter of Isidore Berger et al., Respondents, against Patrick Walsh, as Commissioner of the Fire Department of the City of New York, et al., Appellants.
    Argued October 5, 1943;
    decided November 24, 1943.

      Ignatius M. Wilkinson, Corporation Counsel (Seymour B. Quel, Paxton Blair and Harry Hollander of counsel), for appellants.
    The refusal of the Fire Commissioner to appoint the petitioners was a proper exercise of the discretion conferred upon him by subdivision 7-a of section 246 of the Military Law. (Matter of McNerncy v. City of Geneva, 290 N. Y. 505.) The denial of the application was within the discretion of Special Term and conformed with the rule that mandamus will not issue to protect a bare legal right when the public interest would be injured. (Matter of Coombs v. Edwards, 280 N. Y. 361; Duncan Townsite Co. v. Lane, 245 U. S. 308; People ex rel. Wood v. Board of Assessors, 137 N. Y. 201; Matter of Warehousemen’s Assn. v. Cosgrove, 241 N. Y. 580; Matter of Black v. O’Brien, 264 N. Y. 272; Matter of Wolf v. Valentine, 178 Misc. 308.) The order of the Appellate Division is erroneous in that it directs the outright appointment of the petitioners, thus ignoring the Fire Commissioner’s right of selection in making appointments. (Rules of Municipal Civil Service Commission, Rule 5, §§ 7, 8. Civil Service Law, § 6; Matter of O’Brien v. Delaney, 255 App. Div. 385, 280 N. Y. 697; People ex rel. Balcom v. Mosher, 163 N. Y. 32; People ex rel. Plancon v. Prendergast, 219 N. Y. 252; People ex rel. Kastor v. Kerny, 164 N; Y. 64; Hodgins v. Bingham, 141 App. Div. 514; People ex rel. Baldwin v. McAdoo, 110 App. Div. 432, 190 N. Y. 530; People ex rel. Finnegan v. McBride, 226 N. Y. 252.)

      David A. Savage and John F. O’Shea for respondents.
    Petitioners, as a matter of clear legal right, were entitled to appointment on September 16, 1942. (Matter of Ross v. La Guardia, 287 N. Y. 28.) No discretion is vested in the Fire Commissioner to skip over the names of eligibles certified to him on the ground that such eligibles held a 3-A classification under the Federal Selective Service Act (U. S. Code, tit. 50, Appendix, § 301 et seq.) and were either unmarried with collateral dependents or married after September 15, 1940. (Matter of Wipfler v. Klebes, 284 N. Y. 248; Rules of Municipal Civil Service Commission, rule 5, § VIII, subd. 2; Matter of Williams v. Walsh, 289 N. Y. 1.) Denial of relief to petitioners was an abuse of discretion by Special Term in that it sustained the illegal and arbitrary acts of the defendants. (Matter of Pruzan v. Valentine, 282 N. Y. 498;. Matter of Schwab v. McElligott, 282 N. Y. 182; Matter of Craig v. Board of Education of City of N. Y., 173 Misc. 969; People ex rel. Gas-Light Co. v. Common Council of Syracuse, 78 N. Y. 56; Matter of Oystermen’s Dock Co. v. Dowing, 258 N. Y. 156; People ex rel. Millard v. Chapin, 104 N. Y. 96; People ex rel. Schau v. McWilliams, 185 N. Y. 92.) Petitioners are entitled to an order directing their appointment as firemen, in the Fire Department of the City of New York, as of the 16th day of September, 1942. (Maloney v. Hearst Hotels Corp., 274 N. Y. 106; Matter of Ross v. La Guardia, 287 N. Y. 28; Matter of Ackerman v. Kern, 281 N. Y. 87.)
   Lewis, J.

The names of the petitioners, forty-eight in number, were certified by the Municipal Civil Service Commission as eligible for appointment as firemen in the city of New York. In making appointments from that list the Commissioner of the Fire Department, acting as he believed in the interest of administrative efficiency, passed over the names of the petitioners upon the ground that, although no one of them was then classified as 1-A under the Selective Training and Service Act of 1940 (U. S: Code, tit. 50, Appendix, § 301 et seq.), the existing war emergency had created circumstances which made imminent their reclassification and induction into .the nation’s arméd forces, thus making uncertain their availability for continued future service in the Fire Department.

In this proceeding hy the petitioners to compel their appointment as firemen, we are in agreement with the order of the Appellate Division insofar as it gives effect to the ruling by that court that by failing to recognize and act upon the eligibility of the petitioners for appointment as firemen the Commissioner exceeded the discretionary power granted to him by section 246, subdivision 7-a, of the Military Law. (L. 1942, ch. 795.)

We do not agree, however, with that portion of the order of the Appellate Division which directs “ * * * that the defend- , ant, Patrick Walsh, as Commissioner of the Fire Department of the City of New York, forthwith appoint each of the petitioners, not already appointed, to the position of Fireman, in the Fire Department of the City of New York, effective as of the 16th day of September, 1942, and that the seniority and other rights of each of the petitioners shall be deemed operative from that date.”

Such a direction, we think, would in effect deprive the Commissioner of the power of selection which is implicit in the authority granted to him as an appointing officer. (Municipal Civil Service Buies of the City of New York, rule V, §§ 7, 8; People ex rel. Balcom v. Mosher, 163 N. Y. 32, 40; People ex rel. Kastor v. Kearny, 164 N. Y. 64, 69; People ex rel. Plancon v. Prendergast, 219 N. Y. 252, 259.)

In making appointments of firemen from the eligible list certified by the Municipal Civil Service Commission, upon which appeared the names of the petitioners, the discretion granted to the Commissioner by section 246, subdivision 7-a, of the Military Law (L. 1942, ch. 795) authorized him to treat as unavailable for appointment only those who were then classified as 1-A under the Selective Training and Service Act and those who were then in the Beserve Military or Naval Forces of the United States.

The order of the Appellate Division should be modified by striking out the second decretal paragraph thereof, without costs, and by remitting the proceeding to the Special Term for further proceedings not inconsistent with this opinion.

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

Ordered accordingly.


author: Per Curiam.

text:
    In the Matter of the Claim of Abraham Volinsky, Respondent, against Reliable Waste & Rag Co., Inc., et al., Appellants. State Industrial Board, Respondent.
    Argued October 7, 1943;
    decided November 24, 1943.

      George J. Hayes and William F. O’Rourhe for appellants.
    The Appellate Division in effect directed the Industrial Board to accept its decision on the facts. The. foregoing constitutes patent error of law. (Matter of Daus v. Gunderman & Sons, Inc., 283 N. Y. 459; Matter of Dubinsky v. Kofsky, 266 N. Y. 631; Matter of McGrinder v. Sullivan, 290 N. Y. 11; Matter of Hoffman v. New York Central R. R. Co., 290 N. Y. 277; Matter of Chetney v. Manning Co., 273 N. Y. 82; Matter of Altschuller v. Bressler, 289 N. Y. 463; Matter of Benjamin v. Rosenberg Bros., 180 App. Div. 234, 223 N. Y. 569.)

      Charles Rosenberg and Benjamin H. Siff for claimant, respondent.
    The reversal of the denial of award by the Appellate Division was proper. (Matter of Thompson v. City of Binghamton, 218 App. Div. 451; Matter of Andrews v. Emporium Forestry Co., 250 N. Y. 592; Matter of Blass v. Long Island Motor Parkway, Inc., 222 App. Div. 706; Matter of Shapiro v. Moss & Steinberg, 227 App. Div. 681; Matter of Uhl v. Guarantee Constr. Co., 174 App. Div. 571; Matter of Broleski, 171 App. Div. 959; Matter of Green v. Geiger, 253 App. Div. 469; Matter of Langford v. Republic Steel Corp., 258 App. Div. 1015; Matter of Fowler v. Risedorph Bottling Co., 175 App. Div. 224; Lerner v. Rump Bros., 212 App. Div. 747.) The order placed the Industrial Board under no constraint. It could find as it saw fit. (Matter of Heimroth v. Elk Transp. Co., 263 App. Div. 917, 288 N. Y. 716; Matter of Whitmyre v. International Business Machines Corp., 274 N. Y. 61; Matter of Falk v. Midland Dairy Co., 273 N. Y. 616; Matter of Green v. Geiger, 280 N. Y. 610.)

      Nathaniel L. Goldstein, Attorney-General (Roy Wiedersum and Orrin G. Judd of counsel), for State Industrial Board, respondent.
    No direction to make an award was contained in the opinion of the Appellate .Division or in the order which reversed the decision of the State Industrial Board and remitted the matter to the said Board. The Board reconsidered the case, with full discretion to grant or deny an award, arrived at new findings of fact and made an award based thereon. (Matter of Heimroth v. Elk Transp. Co., 263 App. Div. 917, 288 N. Y. 716.) The final decision of the Industrial Board allowing compensation was based on sufficient evidence and was properly affirmed. (Matter of Whitmyre v. International Business Machines Corp., 274 N. Y. 61; Matter of Falk v. Midland Dairy Co., 273 N. Y. 616; Matter of Green v. Geiger, 280 N. Y. 610.)
   Per Curiam.

A claim for compensation under the Workmen’s Compensation Law was dismissed by the State Industrial Board. On appeal by the claimant to the Appellate Division, this decision was reversed and the matter remitted to the State Industrial Board for further consideration.” (263 App. Div. 221, 223.) The Board thereupon made an award to the claimant which has been affirmed. Carrier and employer have now appealed to us from this affirmance, specifying in their notice of appeal their intention to bring up for review the intermediate reversal by the Appellate Division of the original decision of the Board dismissing the claim.

On its second view of the matter, the Board (without taking new proof except as to the amount of the award) ordered that its first decision be “ amended as of course ” so as to make an award to the claimant. Apparently the Board took the opinion of the Appellate Division as a declaration that compensation was due to the claimant. This was a misconception. The Appellate Division had no power to dictate a decision for the Board. The decision of the board shall be final as to all questions of' fact ”. (Workmen’s Compensation Law, § 20. See Matter of McGrinder v. Sullivan, 290 N. Y. 11.)

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

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

Order reversed, etc.


author: Lottghran, J.

text:
    Jay Ronald Co., Inc., Suing on Behalf of Itself and All Other Stockholders of the Marshall Mortgage Corporation Similarly Situated, Appellant and Respondent, v. Marshall Mortgage Corporation, Respondent and Appellant, et al., Defendants.
    Argued June 17, 1943;
    decided November 24, 1943.

      Harold L. Rosenstein for plaintiff, appellant and respondent.
    The excess capital constituted a debt payable to those who on the date of the capital reduction were holders of the particular class or classes of stock which had represented the portion or portions of capital reduced. The obligation to return the retired capital to those who contributed it was unaffected by the statutes from 1825 to 1939. Those of the statutes from 1882 to 1939 which referred to excess capital merely in some cases made it possible for the directors to determine the time when and the manner in which the debt was to be paid but in no way affected the corporate obligation to pay the debt. (Strong v. Brooklyn Cross-Town R. R. Co., 93 N. Y. 426; Randall v. Bailey, 288 N. Y. 280; Seeley v. New York National Exchange Bank, 8 Daly 400, 78 N. Y. 608; Harper v. State Bank of Paw Paw, 21 N. E. 2d 47; Roberts v. Roberts-Wicks Co., 184 N. Y. 257; Jerome v. Cogswell, 204 U. S. 1; Irvine v. Old Kentucky Distillery, 208 Ky. 414; McCann v. First Nat. Bank, 112 Ind. 354; Jermain v. Lake Shore & Michigan So. Ry. Co., 91 N. Y. 483; Ford v. Snook, 240 N. Y. 624; Hopper v. Sage, 112 N. Y. 530; Wiedersum v. Atlantic Cement Products, Inc., 261 App. Div. 305; Breslav v. New York & Queens Electric L. & P. Co., 249 App. Div. 181, 273 N. Y. 593.) The 1939 amendment does not apply to pre-existing corporations. (Waddey v. Waddey, 290 N. Y. 251; Addiss v. Selig, 264 N. Y. 274; Orinoco Realty Co. v. Bandler, 233 N. Y. 24; New York & Oswego M. R. R. Co. v. Van Horn, 57 N. Y. 473; Holmes v. John Hancock Mut. Life Ins. Co., 288 N. Y. 106; People v. O’Brien, 111 N. Y. 1.) The 1939 statute is unconstitutional if it applies to pre-existing corporations. (Strout v. Cross, Austin & Ireland Lumber Co., 283 N. Y. 406; Farmers & Merchants Bank v. Federal Reserve Bank, 262 U. S. 649; Weiler v. Dry Dock Sav. Institution, 258 App. Div. 581; Lord v. Equitable Life Assur. Soc. 194 N. Y. 212; Parish v. New York Produce Exchange, 169 N. Y. 34; New York & Oswego M. R. R. Co. v. Van Horn, 57 N. Y. 473; Seeley v. New York National Exchange Bank, 78 N. Y. 608; Roberts v. Roberts-Wicks Co., 184 N. Y. 257.)

      Samuel A. Telsey for defendant, respondent and appellant.
    The history and course of legislation exhibit a consistent and uninterrupted policy to permit stockholders to determine the disposition of a surplus resulting from a reduction of capital. (Sutherland v. Olcott, 95 N. Y. 93; People ex rel. Eden Musee Americain Co. v. Carr, 36 Hun, 488; Mers v. Interior Conduit & Insulation Co., 87 Hun, 430; Tyrrell v. The Mayor, 159 N. Y. 239; Hawes v. Fliegler, 87 Minn. 319; Holden v. Minnesota, 137 U. S. 483.) When enacting chapter 787 of the Laws of 1923, the Legislature did not intend to revive the rule of the Seeley case (8 Daly 400). (Matter of Kinney, 270 N. Y. 423; Matter of Duer, 270 N. Y. 343; Caesar v. Bernard, 156 App. Div. 724, 209 N. Y. 570; People v. Dwyer, 215 N. Y. 46; Woods v. Supervisors, 136 N. Y. 403; Matter of Kiernan, 62 N. Y. 457; Matter of N. Y. Institution, 121 N. Y. 234; Heckmann v. Pinkney, 81 N. Y. 211; Ingersoll v. Nassau Electric R. R. Co., 157 N. Y. 453; Randall v. Bailey, 288 N. Y. 280.) Chapter 334 of the Laws of 1939, amending section 36, subdivision 15, of the Stock Corporation Law, deals with matters of internal administration and management of corporate business. It is free from the restriction upon legislation impairing the obligation of contracts, and may operate retrospectively. (Looker v. Maynard, 179 U. S. 46; Schenectady & Saratoga Plank Road Co. v. Thatcher, 11 N. Y. 102; Buffalo & N. Y. City R. R. Co. v. Dudley, 14 N. Y. 336; Matter of Lee & Co’s Bank, 21 N. Y. 9, sub nom. Sherman v. Smith, 1 Black 587; Union Hotel Co. v. Hersee, 79 N. Y. 454; People v. O’Brien, 111 N. Y. 1; Mayor v. Twenty-third St. Ry. Co., 113 N. Y. 311; Grobe v. Erie County Mut. Ins. Co., 39 App. Div. 183, 169 N. Y. 613; Hinckley v. Schwarzschild & Sulsberger Co., 107 App. Div. 470; Colby v. Equitable Trust Co., 124 App. Div. 262; Davis v. Louisville Gas & Electric Co., 16 Del. Ch. 157; Shaw v. N. Y. El. R. R. Co., 187 N. Y. 186.) Under the law existing when the defendant corporation was organized, the distribution of the excess capital was not mandatory. (L. 1923, ch. 787; L. 1924, ch. 441.) Upon dissolution, the capital contributed by common stockholders might legally become subject to the payment of dividends on preferred stock.

      Nathan L. Miller, Eustace Seligman, Howard T. Milman and John C. Bruton for Breed, Abbott & Morgan et al., amici curiae.

    Since 1882 to the present time, the doctrine of the Seeley case has not been the law in New York. (Seeley v. New York National Exchange Bank, 8 Daly 400, 78 N. Y. 608; Matter of Kinney, 279 N. Y. 423.) The New York law since 1901 has been construed as not requiring distribution of surplus resulting from reduction. (Matter of Kinney, 279 N. Y. 423.) The 1939 statute expressly permitting the retention of surplus resulting from a capital reduction applies to preexisting corporations. (Randall v. Bailey, 288 N. Y. 280; Hinckley v. Schwarzschild & Sulzberger Co., 107 App. Div. 470; 193 N. Y. 599; Matter of Buffalo R. R. Co., 37 N. Y. S. 1048;
      Matter of Bergdorf, 149 App. Div. 529; 206 N. Y. 309; Minor v. Erie R. R. Co., 171 N. Y. 566 199 U. S. 613; Breslav v. New York & Queens Electric L. & P. Co., 249 App. Div. 181, 273 N. Y. 593; Roberts v. Roberts-Wicks Co., 184 N. Y. 257; Albrecht, Maguire & Co. v. General Plastics, Inc., 256 App. Div. 134, 280 N. Y. 840; Matter of Rochester Water Commissioners, 66 N. Y. 413.) The 1939 statute is constitutional. (Dartmouth College Case, 4 Wheat. 518; Lord v. Equitable Life Assur. Society, 194 N. Y. 212; Davison v. Parke, Austin & Lipscomb, Inc., 285 N. Y. 500; Breslav v. New York & Queens Electric L. & P. Co., 249 App. Div. 181, 273 N. Y. 593; Albrecht, Maguire & Co. v. General Plastics, Inc., 256 App. Div. 134, 280 N. Y. 840; Hinckley v. Schwarzchild & Sulzberger Co., 107 App. Div. 470, 193 N. Y. 599; Wiedersum v. Atlantic Cement Products, Inc., 261 App. Div. 305; Joslyn v. Pacific Mail S. S. Co., 12 Abb. Pr. [N. S.] 329).
   Lottghran, J.

This controversy was submitted to the Appellate Division upon agreed facts pursuant to Civil Practice Act, sections 546-548.

The defendants are a domestic corporation and its officers and directors. The corporate defendant was organized in 1926 with a stated capital of $300,000 represented by 100,000 common shares of no par value. Since April, 1938, a varying number of these shares have been in the ownership of the plaintiff.

At a meeting of the stockholders held on January 22, 1940, the stated capital of the corporate defendant was reduced from $300,000 to $100,000 and the resulting capital surplus of $200,000 was transferred to a surplus account for all purposes for which a surplus may be used.” When this corporate action was taken the assets of the corporate defendant were of an actual value in excess of $300,000 over and above its liabilities, exclusive of its Lability on its capital stock. A certificate of such capital reduction was filed with the Secretary of State on January 31, 1940. These corporate proceedings were taken without participation by the plaintiff as a stockholder of the corporate defendant.

The Appellate Division has granted to the plaintiff a judgment which reads in part as follows: “ The capital surplus of $200,000 created by the reduction in capital of the defendant corporation may not be retained by the defendant corporation as a corporate surplus, or for any other purpose, but said capital surplus shall be distributed in cash, without interest, among the persons who were stockholders of record * * * at the close of business on January 31, 1940, pro rata according to their then respective shares.” As appellant here, the corporate defendant centers its attack upon this direction of the plaintiff’s judgment.

Plaintiff maintains and the Appellate Division has held that a true surplus resulting from a reduction of corporate capital is at once owed by the corporation as a debt to its stockholders in accordance with their respective interests. So it was laid down in Seeley v. New York National Exchange Bank (8 Daly 400, affd. on opinion below, 78 N. Y. 608). The reasons for that decision were precisely given. It was said by the court of first instance: “ The abandonment by a corporation of all its corporate rights gives the stockholders a right to the distribution of all the net assets. Why should not an abandonment of a portion of those rights give the stockholders a right of distribution pro tanto? * * * That [surplus] money was paid as capital, and if it be no longer needed for that purpose, and if it be not required for the payment of debts, it has accomplished the end for which it was subscribed, and it ought to be returned to the shareholders. * * * If the retired capital be a liability of the corporation in favor of the shareholders who give up the stock that is called in, the payment of that debt cannot lie in any man’s discretion.” (8 Daly at pp. 402, 403.)

The Seeley case was not decided under any New York statute. Our State courts there dealt with Federal legislation permitting national banks to reduce capital. No provision for disposition of surplus had been made therein. We first inquire, then, whether the reasoning of the Seeley case is compatible with the applicable New York statutes regulating reduction of the capital of stock corporations.

The decision of the Seeley case was made by this court in 1879. The first New York statute that made provision for the disposition of surplus resulting from reduction of corporate capital was chapter 306 of the Laws of 1882. The provision then made was that ‘‘ the amount of capital left in the possession of the company over and above the amount to which the capital shall he so reduced shall be returned to the stockholders pro rata at such times and in such manner as the trustees or directors shall determine.” We think this express allowance to directors of discretion to fix the time and manner of the return of such a surplus can hardly be reconciled with the rigid ideas on which the decision of the Seeley case was made to turn.

The statute so enacted in 1882 remained substantially unchanged until 1901. The text of chapter 354 of the Laws of that year was in part as follows: “ Any domestic corporation may increase or reduce its capital stock in the manner herein provided * * *.” (§44.) “ Every such increase or reduction must be authorized either by the unanimous consent of the stockholders, expressed in writing and filed in the office of the secretary of state and in the office of the clerk of the county in which the principal business office of the corporation is located, or by a vote of the stockholders owning at least a majority of the stock of the corporation, taken at a meeting of the stockholders specially called for that purpose in the manner provided by law or by the by-laws.” (§45.) “If the capital stock is reduced, the amount of capital over and above the amount of the reduced capital shall, if the meeting or consents so determine or provide, be returned to the stockholders pro rata, at such times and in such manner as the directors shall determine. ’ ’ (§ 46. The emphasis is ours.) This unqualified license to the stockholders to say whether or no there should be any distribution of such a surplus seems to us to have been a clear negation of the rule of the Seeley case.

So the law stood until 1923. All provisions respecting disposition of surplus resulting from reduction of corporate capital were left out of the Stock Corporation Law as it was then recast by chapter 787 of the laws of that year, with the result that the stockholders were no longer authorized to say whether such a surplus should be returned. But this omission, as we see it, affords no reason for saying that a distribution of every such surplus thereupon became compulsory upon the directors of the corporation. So belated a reversal of policy would scarcely have been conceivable in the face of the new comprehension of corporate structure that in 1912 had led to the introduction of no par shares. (See Vaughan v. State of New York, 272 N. Y. 102.)

I At this point it is in order to answer the claim of an absence prior to 1929 of any statutory provision respecting disposition of retired capital of no par corporations. Section 23 of the Stock Corporation Law, added by chapter 351 of the Laws of 1912, said that for the purpose of any statutory provision relating to the amount of the capital stock of a corporation or the amount or par value of its shares, the aggregate amount of the capital stock of a no par corporation was in general to be deemed to be the aggregate amount of its capital. Thus, as we think, any general statutory provision regulating reductions of par stock was made applicable to reductions of no par stock,— for there was no reason at all why reductions of no par stock should result differently from reductions of par stock.

Section 8 of chapter 441 of the Laws of 1924 reestablished the capacity of the stockholders of a corporation having par value shares to say “ that the excess over the amount to which the capital stock is reduced shall be returned in whole or in part to the stockholders pro rata, at such times and in such manner as the directors shall determine ”, (The accentuated words were new.) In the main, this enactment restored the law to what it had been from 1901 to 1923; then by section 4 of chapter 652 of the Laws of 1929, the stockholders of no par value corporations were explicitly licensed to compel a return on a reduction of capital.

The present proceedings to reduce the capital of this defendant corporation were taken under section 36 (15) of the Stock Corporation Law as amended by chapter 334 of the Laws of 1939. It was thereby enacted that “ the certificate [of the stockholders] shall provide that the surplus, if any, resulting from such reduction shall be available for any one or more of the following purposes: (a) to be used for any purpose for which surplus may be used; or (b) to be reserved and used for specified purposes; or (c) to be returned to the stockholders, according to their respective rights, at the times and in the manner specified.”

We have now canvassed the statutory provisions which seem to us to control the present controversy. Our conclusion is that from the year 1901 to the present time no distribution of a surplus created by reduction of capital of a stock corporation has been required by the law of New York except when pursuant to statute the stockholders so decreed. In that view, the 1939 statute last above indicated was in essence a declaration of what had been the law from a time long antecedent to the organization of the corporate defendant in 1926. It follows that the 1939 statute was here applicable and sanctioned the disposition of the surplus in question as made by the stockholders of the corporate defendant.

■ There are expressions in Strong v. Brooklyn Cross-Town R. R. Co. (93 N. Y. 426) and in Roberts v. Roberts-Wicks Co. (184 N. Y. 257) friendly to the Seeley case (supra). But the question now decided was not presented in the Strong case or in the Boberts case and we have felt free to dispose of it as an open matter.

The judgment, so far as appealed from by the corporate defendant, should be reversed, and judgment directed for that defendant as prayed for in the submission, without costs. The cross-appeal of the plaintiff from denial of its demand for interest and counsel fees and for directions as to distribution of the surplus in question is now futile and should be dismissed, without costs.

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

Judgment accordingly.


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    In the Matter of Louis Strand et al., Doing Business as Commercial Assistance Company, Judgment Creditors, Respondents, against Harry Piser, Judgment Debtor. F. & M. Schaefer Brewing Company, Judgment Creditor, Appellant. Capitol Wine & Spirit Corporation et al., Judgment Creditors, Respondents.
    Argued October 6, 1943;
    decided November 24, 1943.

      David Frank for appellant.
    The refund of a license, permitting the sale of alcoholic beverages, becomes due immediately upon the surrender of the license for cancelation to the State Liquor authority. (Alcoholic Beverage Control Law, § 127; Bailis Bros. Corp. v. Fitzgerald, 157 Misc. 216; Heilman v. St. Cloud Restaurant, Inc., 164 Misc. 15; Matter of Alchar Realty Corp. v. Meredith Restaurant, Inc., 256 App. Div. 853; Matter of Esbeco Distilling Corp. v. Block, 258 App. Div. 757; Matter of Hunter Printing Co. v. Ace Restaurant, Inc., 258 App. Div. 1020; Williams v. Ace Restaurant, Segerman Nixon v. Ace Restaurant, N. Y. L. J. June 28,1939. Montrose Industrial Bank v. Brennan, N. Y. L. J. November 29, 1939; Palmer v. Tremaine, 259 App. Div. 951; Matter of Atlas Advertising Agency, Inc., v. Casa

      Cubana, Inc., 259 App. Div. 951; Capitol Distributors Corp. v. Kent’s Restaurant, Inc., 20 N. Y. S. 2d 436.)
    No appearance for respondents.
   Lewis, J.

In a proceeding supplementary to judgment we are to determine when, under section 127 of the Alcoholic Beverage Control Law, a judgment debtor’s right to a refund from the State Comptroller comes into existence. Upon this determination depends the priority to which the single appellant, a judgment creditor, is entitled among five judgment creditors who have made claim to such a refund.

On March 1, 1941, there was issued to the judgment debtor by the State Liquor Authority a retail liquor license. Although the term of the license was for one year it was surrendered by the judgment debtor for cancellation and refund on April 30, 1941. On that date a receipt executed by the State Liquor Authority was delivered to him showing that there was due thereon a refund of $985. The judgment debtor returned the receipt to the State Liquor Authority on October 28, 1941, accompanied by a verified statement that no actions or proceedings were pending against him which might affect his rights to the refund. Thereafter, on November 18,1941, the State Liquor Authority certified to the Comptroller the amount due the judgment debtor as such refund. Each of the five judgment creditors who are parties to the present proceeding served upon the State Comptroller a subpoena requiring his appearance for examination as a third party. The first three of such third-party subpoenas, including one by the appellant, were served within thirty days after April 30, 1941,— the date when the judgment debtor surrendered his license for cancellation. The remaining two of the five judgment creditors served similar subpoenas upon the Comptroller after November 18, 1941, on which date the State Liquor Authority certified to the Comptroller the amount due as a refund to the judgment debtor. I

Following an examination of the Comptroller as a third party four of the five judgment creditors who had served third-party subpoenas moved at Special Term for orders directing the Comptroller to pay to them respectively the sums to which they were entitled. Each claimed priority. Thereupon Special Term directed by its order that the refund held by the Comptroller to the credit of the judgment debtor be paid to those two judgment creditors which served third-party subpoenas upon the Comptroller after November 18, 1941 — the date of delivery to that official of the judgment debtor’s license cancellation receipt bearing the certificate of approval of the State Liquor Authority. The order at Special Term was based upon the rule in Palmer v. Tremaine (259 App. Div. 951) that: Until the receipt provided by section 127 of the Alcoholic Beverage Con-' trol Law is issued to the surrendering licensee and delivered to the Comptroller, no indebtedness exists from the Comptroller to the licensee and there is no existing fund susceptible of attachment or assignment.” Upon appeal to the Appellate Division by the judgment creditor, The F. & M. Schaefer Brewing Co., the order of Special Term was affirmed unanimously.1 The case is here by our leave upon appeal by the same judgment creditor.

A proceeding supplementary to judgment may be instituted0 within two years from the date of judgment by a subpoena issued by the judgment creditor’s attorney and served upon a third party “ * * * where such attorney has reason to believe that such third party has property of the judgment debtor exceeding ten dollars in value, or is indebted to him in a like sum, requiring the attendance of such third party for examination concerning such property, money or indebtedness.” (Civ. Prac. Act, § 774, subd. 2; § 779, subd. 2.) In the present case section 779 subdivision 2 gave statutory sanction for the issuance in behalf of the appellant creditor and the service upon the Comptroller of a third-party subpoena provided there was reason to believe that on May 26,° 1941 — the date of such service — the Comptroller had in his custody * property of the judgment debtor * * * or [was] indebted to him ”. In that event the statute authorized an examination of the Comptroller as a third party, “ concerning such property, money or indebtedness ”.

‘ ‘ 1 Having money that rightfully belongs to another, creates a debt; and wherever a debt exists without an express promise to pay, the law implies a promise * * *., (Byxbie v. Wood, 24 N. Y. 607, 610.).” (Cohen v. City Company of New York, 283 N. Y. 112, 115). In addition to this principle of common law we look to the statute — the Alcoholic Beverage Control Law, section 127 ■ — ■ which authorizes the refund in question and indicates, we think, within the language of Civil Practice Act, section 779, subdivision 2, that such refund while in the custody of the Comptroller became “ property of the judgment debtor ’ ’, or that the Comptroller was 11 indebted to him ’ ’, from April 30, 1941, the date when the judgment debtor surrendered his license for cancellation and received from the State Liquor Authority a receipt therefor. After authorizing such a refund section 127 of the Alcoholic Beverage Control Law provides that upon surrender of the license — The liquor authority shall thereupon compute the amount of refund then due on said license for the unexpired term thereof, and shall execute a receipt therefor showing the name of the person to whom such license was issued * * * and the date when surrendered for cancellation, together with the amount of refund due thereon at such date as computed by it, and the name of the person entitled to receive the refund.” If within thirty days from the date of surrender the applicant is arrested and convicted of any of the legal infractions there designated, section 127 provides that “ any refund due thereon shall be forfeited, * * In the event the applicant is acquitted, or if within that period of thirty days no action or proceeding is instituted against him then the liquor authority shall prepare an order for the payment of such refund, directed to the comptroller, to be paid him, on his audit, upon the surrender of the receipt theretofore given such person; * * The concluding sentence of section 127 provides: ‘ ‘ Any refunds due on the surrender and cancellation of licenses pursuant to this section shall he paid by the comptroller from moneys in his custody, derived from license fees received pursuant to this chapter.” (Italics supplied.)

We read in the excerpts from section 127, quoted above, an intention by the Legislature to declare a refund due ” on the date when the license is surrendered for cancellation. Accordingly in the present case the refund became due on April 30, 1941, and created on that date in favor of the judgment debtor an obligation whereby the Comptroller, a third party, became indebted ” to the judgment debtor within the language of section 779, subdivision 2, of the Civil Practice Act. Although section 127 of the Alcoholic Beverage Control Law directs that payment of the refund be deferred for a period of thirty days, an obligation impressed upon the Comptroller hy the statute remained and was sufficient to make the third party subpoena, served upon the Comptroller on May 26, 1941, legally effective as a basis for determining the priority of the right asserted by the appellant creditor to the refund.

The orders, insofar as they deny priority to the claim of the appellant creditor, should be reversed without costs, and the proceeding remitted to the Special Term for further proceedings not inconsistent with this opinion.

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

Ordered accordingly.


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    In the Matter of Harry M. Chapin, Respondent, against Board of Education of the City of Buffalo, Appellant.
    Argued October 5, 1943;
    decided November 24, 1943.

      Andrew P. Ponan, Corporation Counsel (Gerald J. Shields of counsel), for appellant.
    Petitioner and other teachers were bound by the decision of the Commissioner of Education, having elected to pursue the remedy provided by section 890 of the Education Law. (Matter of Cochran v. Levy, 175 Misc. 666; Matter of Levitch v. Board of Education, 243 N. Y. 373; Kabatt v. Board of Education, 246 App. Div. 886, 271 N. Y. 629; Bullock v. Cooley, 225 N. Y. 566.) The proper practice under section 1284 of article 78 of the Civil Practice Act should have been a review of the decision of the Commissioner of Education rather than the institution of the instant proceeding. (Matter of Elite Dairy Products v. Ten Eyck, 271 N. Y. 488; Matter of New York Water Service Corp. v. Water Power & Control Comm., 283 N. Y. 23; Matter of Craig v. Board of Education, 173 Misc. 969; Matter of Levitch v. Board of Education, 243 N. Y. 373; Matter of Fabricius v. Graves, 254 App. Div. 19; People ex rel. Lodes v. Department of Health, 189 N. Y. 187; People ex rel. Battista v. Christian, 249 N. Y. 314; Matter of Jacobson v. Board of Education, 177 Misc. 809.) The doctrine of res judicata is applicable in this proceeding. The issues and parties in. this proceeding being the same as in the Baymond J. Murphy, et al. appeal, the petitioners-respondents were bound by the determination and adjudication in the former proceeding. (Bell v. Merrifield, 109 N. Y. 203; Clark v. Scovill, 198 N. Y. 279; Good Health Hairy Products Corp. v. Emery, 275 N. Y. 14; Elder v. New York & Penn. Motor Express Inc., 284 N. Y. 350; United States v. California & Oregon Land Co., 192 U. S. 355.) ,

      William J. Sernoffsky for respondent.
    The court has jurisdiction to determine the question presented. (Matter of Craig v. Board of Education, 173 Misc. 969; Matter of Jacobson v. Board of Education, 177 Misc. 809; Matter of O’Connor v. Emerson, 196 App. Div. 807.)
   Per Curiam.

Petitioner has been for many years a teacher in the public vocational high schools of Buffalo; since 1936 he has taught only “ Academic English.” By this proceeding (in the nature of mandamus) under article 78 of the Civil Practice Act, he seeks to establish his contention that he is by law entitled to a salary of $2,600 per year and that an attempted reduction thereof to $2,500 by the respondent Board of Education in 1939, was illegal. The Board in its answer asserts that the 1939 reduction was legally made. It takes the position that the maximum annual salary of $2,600 established by the Board for vocational teachers ” in 1920 and thereafter mandatory (see Education Law, § 884), was not applicable to petitioner because he is and was a teacher of social ” oracademic ” subjects, not of “ vocational ” subjects, in a vocational high school. Teachers like petitioner, according to respondent Board, are not and never have been “ vocational teachers ” but are and have been “ high school classroom teachers ” for whom the mandate°d maximum salary is and was $2,400. The Board admits that it paid petitioner $2,600 annually for some years but claims that there was included therein a voluntary increase of $200 over the mandated maximum. This $200 increase, says the Board, could be and was legally withdrawn (in part) when petitioner’s salary was reduced from $2,600 to $2,500 in 1939. The Board sets up also a defense to tlie effect that the same issues here raised were determined adversely to petitioner by the State Commissioner of Education in a proceeding in the form of an “ appeal ” taken to that official by petitioner and others from the Board’s action in making the 1939 reduction from $2,600 to $2,500. The Board attached to its answer herein a copy of the State Commissioner’s decision in that proceeding, in which decision the Commissioner, after discussing the facts of this dispute and the contentions of the adversaries, stated and held that teachers who devote a majority of their time to recognized non-vocational, or academic subjects are teachers of academic subjects even though they teach in vocational schools.” It plainly appears that the issues before the State Commissioner were identical with those now before the courts in this proceeding. The Commissioner’s holding is, of course, the direct opposite of the claim of petitioner in the proceeding presently before us. That decision of the Commissioner, while it stated a rule which, if and when applied to petitioner, necessarily defeats his claim, did not in so many words state whether the 1939 reduction was legal or illegal as to any particular teacher. Instead the decision, reciting that the record before the Commissioner did not plainly show which of the teachers who had appealed to him were teaching “ academic subjects ” and which teachers were teaching vocational subjects ”, directed the Board of Education to “ examine into the services being performed by the appellants and allocate them to the proper schedule in accordance with the above.” Petitioner has not attempted to review that determination by a proceeding against the Commissioner under article 78 of thé' Civil Practice Act but, ignoring or by-passing the Commissioner’s holding, seeks in this proceeding an order directing the Board of Education to pay him the higher salary of $2,600, to which, according to the Commissioner’s decision, petitioner is not entitled. Special Term and the Appellate Division were of the opinion that petitioner is entitled to the relief he prays for. We take the contrary view.

Section 890 of the Education Law makes final and conclusive, and not subject to question or review in any place or court whatever ”, a decision of the Commissioner of Education on an “ appeal ” to him in a, controversy such as this. Similar provisions have been in the statutes since 1822 (see chapter 256 of the laws of that year). Since the Commissioner’s determination of this controversy is not shown to have been purely arbitrary ”, it was and is final and binding on petitioner and bis colleagues. (Matter of Levitch v. Board of Education, 243 N. Y. 373.) The conclusiveness of that decision is not affected by its failure to take on the conventional form and appearance of a court order or judgment. Though it did not single out petitioner and announce that his salary had been legally reduced, the Commissioner’s decision did contain a plain and unmistakable ruling on the question tendered to him by petitioner and his associates, which ruling, applied to the undisputed facts of petitioner’s teaching work, resulted necessarily and as of course in holding valid the reduction, the legality of which petitioner attempts to_ litigate anew in this proceeding. By the express language of section 890 of the Education Law, such a resort to the courts, after a failure to convince the Commissioner, is forbidden.

The orders should be reversed, without costs, and the proceeding dismissed.

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

Orders reversed, etc.


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    George R. Teich, on His Own Behalf as a Stockholder and for the Benefit of All Other Stockholders, Similarly Situated, of Equity Corporation, Appellant and Respondent, and Cambart Co., Inc., Intervener, Plaintiff, Appellant and Respondent, v. Joseph S. Lawrence et al., Defendants, and David M. Milton et al., Defendants, Respondents and Appellants.
    Argued October 11, 1943;
    decided November 24, 1943.

      Samuel A. Mehlman for George R. Teich, plaintiff, appellant and respondent.
    The first cause of action is the embodiment of fraud and is governed by the six-year fraud statute, subdivision 5 of section 48 of the Civil Practice Act. (Nasaba Corp. v. Harfred Realty Corp., 287 N. Y. 290; Kershaw v. Julien, 72 F. 2d 528; The Kalfarli, 277 F. 391; Matter of Di Crocco, 170 Misc. 826; Wechsler v. Bowman, 285 N. Y. 284; Broderick v. Marcus, 146 Misc. 240, 239 App. Div. 816; Ripperger v. Allyn, 37 F. Supp. 369; Lonsdale v. Speyer, 249 App. Div. 133; Matter of Van Sweringen Co., 119 F. 2d 231; Chappel v. First Trust, 30 F. Supp. 763.) The first cause of action is governed by the ten-year Statute of Limitations because an equity court alone can grant full and complete recovery. (Squier v. Houghton, 131 Misc. 129; Newton v. Porter, 69 N. Y. 133; Potter v. Walker, 276 N. Y. 15; Hanover Fire Ins. Co. v. Morse D. D. & R. Co., 270 N. Y. 86; Cwerdinski v. Bent, 256 App. Div. 612, 281 N. Y. 782; Pink v. Title Guarantee & Trust Co., 274 N. Y. 167; Hearn 45th St. Corp. v. Jano, 283 N. Y. 139; Frank v. Carlisle, 261 App. Div. 13; Wagner v. Armsby, 264 App. Div. 379.)

      Enos S. Booth and George G. Baron for Cambert Co., Inc., plaintiff, intervener, appellant and respondent.
    The first cause of action is within subdivision 5 of section 48 of the Civil Practice Act and is not barred. (Pink v. Title Guarantee & Trust Co., 274 N. Y. 167; Nasaba Corp. v. Harfred Realty Corp., 287 N. Y. 290.) In the event that the first cause of action does not fall within subdivision 5 of section 48 of the Civil Practice Act, then it still is not barred by the Statute of Limitations because then the ten-year statute would apply. (Civ. Prac. Act, § 53; Hanover Fire Ins. Co. v. Morse D. D. & R. Co., 270 N. Y. 86; Potter v. Walker, 276 N. Y. 15; Chance v. Guaranty Trust Co. of New York, 260 App. Div. 216; Falk v. Hoffman, 233 N. Y. 199; Hearn 45th St. Corp. v. Jano, 283 N. Y. 139; Fur & Wool Trading Co. v. Fox, 245 N. Y. 215; Goldstein v. Tri-Continental Corp., 282 N. Y. 21.) The Statute of Limitations should be liberally construed in favor of the plaintiffs. (National Surety Co. v. Ruffin, 242 N. Y. 413; Matter of Steinway, 174 Misc. 554.)

      William C. Scott, William J. Mahon and Donald W. Smith for defendants, respondents and appellants.
    The first cause of action does not state a cause of action to procure a judgment on the ground of fraud within the meaning of subdivision 5 of section 48 of the Civil Practice Act. (Frank v. Carlisle, 286 N. Y. 586; Dunlop’s Sons, Inc., v. Spurr, 285 N. Y. 333; Potter v. Walker, 276 N. Y. 15; Carr v. Thompson, 87 N. Y. 160; Brick v. Cohn-Hall-Marx Co., 276 N. Y. 259; Wechsler v. Bowman, 285 N. Y. 284; Hearn 45th St. Corp. v. Jano, 283 N. Y. 139; Lever v. Guaranty Trust Co., 262 App. Div. 1044, 289 N. Y. 615; Siegrist v. American Sugar Refining Co., 289 N. Y. 602; Siegrist v. American Locomotive Co., 289 N. Y. 604; Hart v. Goadby, 72 Misc. 232; Glover v. National Bank of Commerce, 156 App. Div. 247; Druckerman v. Harbord, 31 N. Y. S. 2d 867; Gobel v. Hammerslough, 263 App. Div. 1, 288 N. Y. 653.) The first cause of action is barred by the six-year Statute. It is one for damage to property, or at the very most, an action for money" had and received. Having been commenced more than eight years after the commission of the acts complained of, it is barred. (Potter v. Walker, 276 N. Y. 15; Dunlop’s Sons, Inc. v. Spurr, 259 App. Div. 233, 285 N. Y. 333; Frank v. Carlisle, 286 N. Y. 586; Brackett v. Griswold, 112 N. Y. 454; Green v. Davies, 182 N. Y. 499; Von Au v. Magenheimer, 126 App. Div. 257, 196 N. Y. 510; Coronado Development Corp. v. Millikin, 175 Misc. 1; Keys v. Leopold, 241 N. Y. 189; Goldstein v. Tri-Continental Corp., 282 N. Y. 21; Pierson v. McCurdy, 33 Hun, 520, 100 N. Y. 608; Corash v. Texas Co., 264 App. Div. 292; Hanover Fire Ins. Co. v. Morse D. D. & R. Co., 270 N. Y. 86; Butler v. Johnson, 111 N. Y. 204.) Actual fraud within the meaning of subdivision 5 of section 48 of the Civil Practice Act is not the gravamen of the first cause of action. Common law fraud is not even alleged. (Carr v. Thompson, 87 N. Y. 160; Glover v. National Bank of Commerce, 156 App. Div. 247; Brick v. Cohn-Hall-Marx Co., 276 N. Y. 259; Frank v. Carlisle, 286 N. Y. 586; Lever v. Guaranty Trust Co., 262 App. Div. 1044, 289 N. Y. 615; Gobel v. Hammerslough, 263 App. Div. 1, 288 N. Y. 653; Hart v. Goadby, 72 Misc. 232; Druckerman v. Harbord, 31 N. Y. S. 2d 867.) The ten-year Statute has no application to the first cause of action. (Hart v. Blabey, 287 N. Y. 257; Model Building & Loan Assn. v. Reeves, 236 N. Y. 331; Seymour v. Mechanics & Metals Nat. Bank, 199 App. Div. 707; New York & Boston Despatch Express Co. v. Carroll, 170 App. Div. 197; Dunlop’s Sons, Inc., v. Spurr, 285 N. Y. 333; Hastings v. Byllesby & Co., 265 App. Div. 643; McLear v. McLear, 265 App. Div. 556, 266 App. Div. 702; Roberts v. Ely, 113 N. Y. 128; Marvin v. Brooks, 94 N. Y. 71; People v. Central R. R. Co., 42 N. Y. 283.) The second and fourth causes of action are likewise barred by the six-year Statute. (Schmidt v. Merchants Despatch Trans. Co., 270 N. Y. 287.)
   Per Curiam.

In this stockholders derivative action, two defendants moved for an order dismissing the first, second and fourth causes of action on the ground that this action thereon was not commenced within the time limited by law for the commencement thereof. (See Rules of Civil Practice, rule 107, subd. 6.) Special Term granted the motion. On appeal by the plaintiffs to the Appellate Division the order was so modified that the motion to dismiss was granted as to second and fourth causes of action and otherwise denied. Thus as to the first cause, this action was held to have been commenced in time. The ease is now here on cross appeals.

We agree with the courts below in their ruling that the second and fourth causes were barred when this action was commenced against the moving defendants. The contrary ruling which the Appellate Division made in respect of the first cause was based on the view that the first cause sought a judgment on the ground of fraud within' Civil Practice Act, section 48, subdivision 5. This was error. A stockholders’ derivative action belongs to the corporation that has been wronged. The present complaint alleged no fraud upon the defendant corporation in whose behalf the plaintiffs sue. (See Lever v. Guaranty Trust Co., 289 N. Y. 615.)

On plaintiffs’ appeal, the judgment should be affirmed, without costs.

On defendants’ appeal, the order of the Appellate Division should be reversed and the judgment of the Special Term affirmed, with costs in the Appellate Division and in this court. The question certified should be answered in the affirmative.

Lehman, Ch. J., Loughran, Lewis, Conway, Desmond and Thacher, JJ., concur; Rippey, J., taking no part.

Judgment accordingly.