author: Pound, J.

text:
    In the Matter of Joseph Levy, an Attorney, Appellant. Association of the Bar of the City of New York et al., Respondents. In the Matter of Aaron M. Becker, an Attorney, Appellant. Association of the Bar of the City of New York et al., Respondents.
    (Argued November 19, 1930;
    decided January 6, 1931.)

      Harold R. Medina and James J. Regan for appellants.
    Appellants’ assertion of their constitutional privilege was not professional misconduct and constitutes no ground for disbarment. (People v. O’Brien, 176 N. Y. 253; People ex rel. Karlin v. Culkin, 248 N. Y. 465; People ex rel. Taylor v. Forbes, 143 N. Y. 219; Matter of Kaffenburgh, 188 N. Y. 49; Matter of Rouss, 221 N. Y. 81.)

      H. Bartow Farr and Isidor J. Kresel for respondents.
    No constitutional question is directly involved in the appeal. (Matter of Mathot, 222 N. Y. 8; Haydorn v. Carroll, 225 N. Y. 84; Valz v. Sheepshead Bay Bungalow Corp., 249 N. Y. 122; People ex rel. Lewis v. Graves, 245 N. Y. 195; People ex rel. Curtis v. Kidney, 225 N. Y. 299; Matter of Rouss, 221 N. Y. 81; Matter of Kaffenburgh, 188 N. Y. 49.) Appellants were properly disbarred for their refusal in the investigation to answer proper and material questions on the ground that their answers might tend to incriminate them. (Matter of Kaffenburgh, 188 N. Y. 49; Matter of Rouss, 221 N. Y. 81; People ex rel. Karlin v. Culkin, 248 N. Y. 465.)
   Pound, J.

The appeals herein have been taken without leave of this court or of the Appellate Division on the ground that the orders finally determine disbarment proceedings “ wherein is directly involved the construction of the Constitution of the State or of the United States.” (N. Y. Const, art. VI, § 7 (1); Civ. Prac. Act, § 588, subd. L) The clause of the Constitution the construction of which is said to be “ directly involved ” is the familiar one which provides: “ No person * * * shall * * * be compelled in any criminal case to be a witness against himself.” (N. Y. Const, art. I, § 6.)

This clause is said to be directly involved ” because the appellants herein on the preliminary investigation of ambulance chasing ordered by the Appellate Division (People ex rel. Karlin v. Culkin, 248 N. Y. 465) asserted their claim of privilege and refused to answer certain questions propounded to them as to their professional conduct. Although they afterwards testified freely before the referee in the disbarment proceedings on the same matter without self-incrimination, it was, on the preliminary investigation not so perfectly evident and manifest that the answer called for (could not) incriminate, as to preclude all reasonable doubt or fair argument.” (People ex rel. Taylor v. Forbes, 143 N. Y. 219, 231.) They were sustained in their claim of privilege, and properly so.

When, however, the Appellate Division acted in the disbarment proceedings it held that the claim of privilege was asserted in bad faith on the preliminary hearing for the purpose of hindering and impeding the investigation and that such conduct justified the removal of appellants from the practice of law. The witness may not claim his privilege when he is clearly contumacious, not acting in good faith but making the claim as a mere pretext to avoid giving non-incriminating answers. (People ex rel. Taylor v. Forbes, supra.)

We fail to see how the construction of the Constitution is directly involved (People ex rel. Moss v. Supervisors, 221 N. Y. 367; People ex rel. Curtis v. Kidney, 225 N. Y. 299) or that any question of constitutional right is involved. We pass as unnecessary for consideration at this time the question whether the assertion in good faith of the privilege against self-incrimination is ground for disbarment. Appellants were not disbarred for asserting their privilege but for asserting it in bad faith. We may not examine the evidence on a motion to dismiss an unauthorized appeal in order to ascertain whether it sustains the finding that the privilege was asserted in bad faith. No question of constitutional right to remain a member of an honorable profession arises when an attorney delays or impedes justice by the contumacious assertion of spurious privileges. That question is all that we may consider in this connection.

Another ground urged for disbarment remains to be considered. The Appellate Division sustained charges of ambulance chasing against appellants and said that on this charge alone the court was justified in disbarring them. It is urged that the appeal will not lie as of right even if a constitutional question were otherwise involved. As we think it affirmatively appears in this case that the construction of the Constitution is not involved it is unnecessary to discuss the point at length. The rule has been sufficiently stated in Matter of Haydorn v. Carroll (225 N. Y. 84, 88) as follows: “ If the decision was or may have been based upon some other ground [than that involving the construction of the Constitution] the appeal will not lie.”

The appeals should be dismissed.

Cardozo, Ch. J., Crane, Lehman, Kellogg, O’Brien and Hubbs, JJ., concur.

Appeals dismissed.


source: Caselaw Access Project

author: Cardozo, Ch. J.

license: Public Domain

text:
    Mary R. Burke, Respondent, v. Samuel Bonat et al., Copartners under the Firm Name of Samuel Bonat & Bro., Appellants.

      (Argued November 21, 1930;
    decided January 6, 1931.)

      Thomas J. P. Cawley for appellants.
    The trial judge improperly received and excluded evidence and improperly charged the jury with reference to the agency of the defendants’ salesman and of the scope or apparent scope of his authority to give a permanent wave so as to bind these defendants. (Minor v. Edison Electric Illuminating Co., 22 Misc. Rep. 543; 26 Misc. Rep. 712; Hogue v. Simonson, 94 App. Div. 139; Debautte v. Curiel, 2 Misc. Rep. 170; 142 N. Y. 635; Levis v. Pope Motor Car Co., 202 N. Y. 402; Williams v. Brandt, 90 App. Div. 607; Delafield v. Armsby Co., 99 App. Div. 622; Lamb v. Hirschberg, 1 Misc. Rep. 108; Crist v. Turner, 175 App. Div. 664; Rolfe v. Hewitt, 227 N. Y. 486; Riley v. Standard Oil Co., 231 N. Y. 301; Stone v. Eisen Co., 219 N. Y. 205; Cunningham v. Castle, 127 App. Div. 585; Higgins v. Western Union Telegraph Co., 156 N. Y. 75; Morris v. Crusius, 207 App. Div. 232; 238 N. Y. 600; Hogle v. Franklin, 105 N. Y. Supp. 1094; Katz v. Wolf & Ranheimer, 129 Misc. Rep. 384; Jones v. Wigand, 134 App. Div. 644; Tousey v. Roberts, 114 N. Y. 312; Sharpe v. Erie R. R. Co., 184 N. Y. 100; Magar v. Hammond, 171 N. Y. 377.)

      Martin L. Murray and W. Joseph Shanley for respondent.
    The salesman of the defendants was the agent of the defendants, and the defendants are liable o the plaintiff for his negligence and for his wrongful acts perpetrated in the course of his employment. (Nowack v. Metropolitan St. Ry. Co., 166 N. Y. 433; Riley v. Standard Oil Co., 231 N. Y. 301.)
   Cardozo, Ch. J.

The action is for personal injuries.

Plaintiff in 1928 was the proprietor of a “ beauty parlor ” in the city of Troy. Defendants were manufacturers of the appliances that are used in a business of that kind. In particular they manufactured machines with fittings and appurtenances designed to give to hair a permanent wave or curl according to the Bonat method. They employed a traveling salesman, Cooper, who had samples of their products.

Cooper called at the plaintiff’s shop on May 9, 1928, and sold her certain,tubes and winders which if used in connection with her own waving machine, described as the Eugene type, would cause it to function according to the Bonat method. Before making the sale, he explained to her by curling a strand of hair around the winder in his hand how the result of the process was to form a perfect ringlet. Plaintiff says that he kept up his visits after the sale of the equipment, and urged her to buy a new machine to take the place of the old one. In pressing this sale, he asked her, so she says, to let him give her a permanent wave, which she was unwilling for a time to do. Cooper tells us, on the other hand, that when his business with her was over, she asked him to wave her hair, not in aid of any sale, but as a personal favor for her personal adornment. However this may be, she called at his hotel a week later in company with a friend and submitted to his treatment. The testimony sustains a finding that in steaming the curls, he applied excessive heat, so burning the entire head of hair that it fell at once upon the floor. Bor the pain and distress suffered while the hair was in process of regrowth the plaintiff had a verdict.

The question of law is whether the application of a permanent wave was within the implied authority of an agent employed to make sales of the machines. There is no evidence that such an act was authorized by express instructions. The testimony is to the contrary. There is no evidence that there was a general usage whereby a demonstration of that order became an incident of the agency. The question is closer whether such a method of demonstration, though it did not arrive at the generality of a usage, was a usual course of procedure in the sense that it was something not extraordinary or uncommon (American Law Institute, Restatement of the Law of Agency, §§ 245, 246, 259). Direct evidence there is none. On the other hand, the triers of the facts might reasonably say that circumstantial evidence was not lacking altogether. More or less doubtfully the circumstances point to the conclusion that demonstrations of the wave were understood to be essential if sales were to be made, • and that salesmen, when qualified, were expected to give them. There is a concession that the defendants had stations at various places where the buyers of the machines ■ might have a demonstration free of cost at the hands of employees engaged for that very purpose. This indicates an understanding that a demonstration of the wave was incidental to the business, though it does not prove without more that the demonstration might be given at the hands of a traveling salesman. There are, however,' other circumstances that are not without significance. The circumstance is significant that Cooper, before his employment by the defendants, had been the proprietor of a beauty shop, and was known by the defendants to be an experienced and skillful operator. One finds it not unlikely that they expected him to make use of that experience in furtherance of his agency. So, indeed, he did, according to his own admission, though there is no direct evidence that his employers were ever told of it. He employed a demonstrator at his own expense, and at times, when requested by a customer, he did the work himself. One other fragment of evidence is even more suggestive. The senior member of the defendants’ partnership was asked, when cross-examined, whether Cooper was “ competent to demonstrate the machines by giving a permanent wave,” and answered, “ He knew it; he is supposed to sell it.” There lurks in this answer an admission, or so a jury might infer, that one who sells such a machine is expected to be competent to use it.

On the basis of this evidence the trial judge made the ruling that the act as a matter of law was within the implied authority of the agent. At times he did indeed profess to leave the question to the jury with directions that they were to answer it in the light of their own experience of life and knowledge of affairs. No sooner did he leave it to them, however, than he withdrew the nominal submission by telling them that the authority was one implied in law. The case must be reviewed as if he had decided it himself.

By concession, the process of applying a permanent wave is accompanied by danger if not skillfully performed. A salesman has implied authority in effectuating a sale to do whatever is necessary according to the usual course of procedure prevailing in the business (Ahern v. Goodspeed, 72 N. Y. 108, 114; Wait v. Borne, 123 N. Y. 592, 604; First Nat. Bank v. Farson, 226 N. Y. 218, 224, 1 Mechem, Law of Agency, § 715). What that procedure is will commonly be a question of fact to be answered by a jury (Mechem, supra; Benjamin, Sale [6th ed.], p. 768), unless the course of business is so notorious as to become a subject for judicial notice (Ahern v. Good speed, supra). Sometimes the jury’s answer may be given in the light of everyday experience. This will be so when the transaction is of a type so ordinary and simple that everyday experience may reasonably and safely be accepted as a guide (Mechem, supra). Sometimes the quality of the act or the setting of the circumstances may call for proof of what is usual before everyday experience may leap to a conclusion. If there is no proof of what is usual, a substitute may be found in evidence, direct or circumstantial, of expectation or desire.

Adherence to these principles is fatal to this verdict, rooted, as it is, in the assumption that as a matter of law authority was present. The agent was free to explain the qualities of the machine and to illustrate its operation by the winders and strands of hair which he carried in his pocket. The conclusion does not follow that he had authority from his principal, not only to sell to a buyer, but to curl the buyer’s hair. One might as well say that a salesman of dental supplies would have implied authority from an employer, if a license were not required, to drill the buyer’s tooth. Many circumstances are to be weighed, such as the nature of the risk and the likelihood that a salesman has the training of- an operator, before authority is thus extended. Some lines of business there are so simple and familiar that the common experience of a jury, unaided by evidence, may fix the measure of authority. Such in all likelihood is the sale of automobiles and tractors, if indeed the extent of the practice does not call for judicial notice. The business of supplying appliances for beauty parlors can hardly be said at the present hour to have reached that stage of notoriety, either for judges or for jurors, however near it may be to coming there. Even so, there are tokens of expectation and desire from which a jury might draw an inference as to the usual course of procedure in the business conducted by the defendants, if not in the trade generally. Error was committed when the inference was drawn by the judge.

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

• Lehman, Kellogg, O’Bbien and Hubbs, JJ., concur; "•Pound and Cbane, JJ., dissent.

Judgments reversed, etc.


text:
    The People of the State of New York ex rel. Village of Chateaugay, Respondent, v. Public Service Commission of the State of New York, Respondent and Appellant, and New York State Electric and Gas Corporation, Appellant.

      (Argued November 17, 1930;
    decided January 6, 1931.)

      E. B. Naylon and Frank Irvine for New York State Electric and Gas Corporation, appellant.
    The court did not pass upon the validity or invalidity of the franchise issued to defendant-appellant’s assignor. (Village of Chateaugay v. Chasm Power Co., 227 App. Div. 643; 253 N. Y. 592; Cromwell v. County of Sac, 94 U. S. 351; United States v. Mitchell, 271 U. S. 9; Webster v. Fall, 266 U. S. 507; Matter of Public Nat. Bank, 278 U. S. 101; New v. Oklahoma, 195 U. S. 252; Matter of Lyman, 160 N. Y. 96; 161 N. Y. 119.) The franchise issued to defendant-appellant’s assignor is a valid existing franchise. (New York Electric Lines v. Empire Subway Co., 235 U. S. 179; New York Electric Lines v. Gaynor, 218 N. Y. 417; Hagerla v. Mississippi Co., 202 Fed. Rep. 776; People v. Broadway R. R. Co., 126 N. Y. 29; Archibald v. N. Y. C. & H. R. R. R. Co., 157 N. Y. 574; Vroom v. Tilly, 184 N. Y. 168; First Construction Co. v. State of New York, 221 N. Y. 295; People v. O’Brien, 111 N. Y. 1.)

      Patrick J. Tierney and Thomas J. Fitzpatrick for Village of Chateaugay, respondent.
    The Public Service Commission had no jurisdiction to grant permission and approval to defendant-appellant because there is no valid outstanding consent by the respondent. (Matter of City of Long Beach v. Public Service Comm, 249 N. Y. 480; New York, O. & W. Ry. Co. v. Griffin, 235 N. Y. 174.) The franchise issued to defendant-appellant’s assignor having lapsed, is invalid. (New York v. Bryan, 196 N. Y. 164; Trustees of Southampton v. Jessup, 162 N. Y. 122; Wheeling v. Chesepeake Tel. Co., 95 S. E. Rep. 653; People v. Broadway Ry. Co., 126 N. Y. 29; First Const. Co. v. New York, 221 N. Y. 295; Vroom v. Tilly, 184 N. Y. 168.) The question before the Commission in this proceeding was res adjudicaia. (Village of Chateaugay v. Chasm Power Co., 227 App. Div. 642; 253 N. Y. 592; Barber v. Kendall, 158 N. Y. 401; Pray v. Hageman, 98 N. Y. 351;
      Smith v. Smith, 79 N. Y. 634; Frear v. Sweet, 118 N. Y. 454.)
   Cardozo, Ch. J.

On the petition of the Eastern New York Electric and Gas Company, the Public Service Commission on March 14, 1929, made an order approving the construction by the petitioner of an electric plant for furnishing to the public electricity for light, heat and power in the village of Chateaugay, Franklin county, and permitting and approving the exercise of the rights and privileges conferred by a franchise which had been granted by the Board of Trustees of the village to J. 0. Smith, the petitioner’s assignor, on March 28, 1899.

The village of Chateaugay, which had opposed the granting of the certificate, sued out an order of certiorari to review the order of the Commission as well as. a later order denying a rehearing.

The New York State Electric and Gas Corporation, the successor to the Eastern New York Electric and Gas Company, intervened by leave of court as a party to the proceeding.

The Appellate Division upon the return to the order of certiorari annulled the determination of the Commission upon two grounds: First, that by a judgment in a former action between the village and the lighting company it had been adjudged that the so-called Smith franchise was non-existent and void; and second, that irrespective of the effect of the former adjudication, the franchise was without validity for non-acceptance and non-user.

Upon this appeal by the lighting company the two objections to the franchise will be considered in succession.

(1) We are unable to yield assent to the conclusion of the court below that the invalidity of the Smith franchise is res judicata.

In 1902 the village of Chateaugay granted to a corporation, the Chasm Power Company, a franchise to occupy the streets and supply electric fight and power for a period of twenty years. Upon the expiration of the twenty years (in 1922), the limitation of time was apparently overlooked, and the power company continued to serve the village and the public as it had done those many years before. The limitation was remembered in 1925, and thereupon the village, instead of renewing or continuing the franchise in favor of the company in possession, declared it at an end and attempted to confer it on another. Á lawsuit promptly followed. The village brought suit against the Chasm Power Company in August,' 1926, to enjoin the continued occupation of the streets and public places by the poles and other fixtures. The power company answered pleading acquiescence and estoppel. During the pendency of the action the rights, if any, of the power company were assigned to the Eastern New York Gas and Electric Company, which was joined as a defendant. The suit resulted in a judgment in favor of the village enjoining the continued occupation of the streets and public places, which judgment was affirmed by the Appellate Division (227 App. Div. 642) and later by this court (253 N. Y. 592).

Before the grant of any franchise to the Chasm Power Company, one J. 0. Smith had applied to the Board of Trustees of the village for a franchise peimitting him or his assigns to place poles and other lighting appliances in the streets of the village for the purpose of supplying electric light under the name of the High Falls Electric Light and Power Company. On March 27, 1899, the Board of Trustees adopted a resolution granting the petition. Incorporated in the resolution was a written promise signed by Smith, dated the same day, whereby he undertook in consideration of the granting of the franchise to supply light to the village for its streets and public buildings at designated rates. The Board of Trustees, in the resolution granting the petition, accepted this offer, and by implication, if not expressly, promised on jts part to make payment for the service.

Nothing was done by Smith under the contract so made or the franchise so conferred. No plant was ever acquired by him, and no poles or wires were ever built or strung. After his death, however, his executors assigned his rights and interests in and under the franchise to the Eastern New York Electric and Gas Company. This assignment was made in November, 1927, while the suit by the village against the power company was still undetermined.

No issue in respect of the Smith franchise or of the rights of an assignee thereunder was tendered by the pleadings, in the suit by the village. Indeed, when the suit was begun, the Chasm Power Company, which had never acquired Smith’s interest in the franchise, was still the sole defendant. The wrong charged in the complaint was the continued occupation of the streets after the time limit had expired. The justification pleaded in the answer was acquiescence and estoppel. Upon those issues the parties went to trial, the power company’s assignee being then joined as a defendant. In the course of the trial, without suggestion of a purpose to broaden the issues as defined by the pleadings, the defendants put in evidence the Smith franchise and the assignment. At that time . (November, 1928) the Public Service Commission had not yet issued a certificate of permission and approval. Plainly, therefore, the Smith franchise, apart from any objection of non-acceptance or non-user, could not avail to confer upon the defendants a present right of occupation (Public Service Commission Law; Cons. Laws, ch. 48, § 68). The defendants in offering it in evidence, did not state the purpose of the offer, but they must have understood that in the absence of a certificate the privilege that it conferred was at best imperfect and potential. When the case was in this court (253 N. Y. 592), they disavowed any notion either then or at any time that a privilege so inchoate was evidence of a subsisting right. The object of the offer was stated to be this, that the remedy of an injunction being discretionary, the acquisition of the Smith franchise, though not justifying occupation in default of approval by the Commission, might be deemed to be a circumstance affecting in some measure the exercise of discretion.

When the case was submitted to the trial judge, the defendants proposed 74 findings of fact and 9 conclusions of law. Two of the proposed findings of fact set forth the resolution of the village granting the franchise to Smith and the assignment by Smith’s executors. None of the conclusions of law proposed any ruling in respect of its validity. Whatever validity it had was treated, apparently, as inchoate and uncertain, for the action of the Commission was still unknown and problematical. At most there was a suggestion of a circumstance that might supply a reason for delay.

On the side of the plaintiff village, there was equally no thought that the validity of the assignment to Smith and his assigns was an issue to be determined. The decision of the trial judge, which embodies presumably the findings proposed by the successful party, does not mention the Smith franchise at all. No finding was proposed that there had been a failure to accept it or a failure to use it. No conclusion was proposed that its vitality had been sapped by inaction or abandonment. There is indeed a conclusion of law that the defendants “ have no consent, grant or franchise from the plaintiff, the Village of Chateaugay, to occupy the streets and public places of the Village.” This conclusion, classified as one of law, is not a determination of new issues, unrelated to the pleadings. It is precisely what it professes to be, a deduction of law from the facts already found. The meaning is no more than this, that the franchise to the power company, the only franchise mentioned in the decision, has been terminated through lapse of time, and that the acts relied upon by the defendants in support of their defenses of acquiescence and estoppel are'unavailing to preserve it.

The burden is on a litigant who claims the benefit of a former judgment as res judicata to prove that the res to be thus established by estoppel was either involved by implication or actually determined in the former litigation (Rudd v. Cornell, 171 N. Y. 114, 127; Silberstein v. Silberstein, 218 N. Y. 525, 528; Mehlhop v. Central Union Trust Co., 235 N. Y. 102; Schuylkill Fuel Corp. v. Nieberg Realty Corp., 250 N. Y. 304). Presumably the issues involved or determined are those pertinent to the subject of the controversy as defined by the pleadings (Silberstein v. Silberstein, supra; Pray v. Hegeman, 98 N. Y. 351, 358). If, adhering to that presumption, we look to the pleadings in the former litigation, we find that a franchise distinct altogether from the one to Smith and his assigns was the subject of the controversy. The test of the pleadings and their implications, however, is not final and exclusive. The course of the trial or the form of the decision may show that the pleadings were abandoned, and that controversies beyond them were determined after trial (Silberstein v. Silberstein, supra). This extension of the pleadings is not to be presumed. The burden of proving it is on the party asserting the estoppel. We think the burden is not sustained upon the record now before us. The record does not show in any clear or satisfactory way that the defendants in the former action understood that they were litigating the question whether the franchise to Smith and his assigns, which by concession was still inchoate for want of the approval of the Commission, had been abandoned or forfeited through non-acceptance or nonuser, with the result that approval, if obtained, would be vain and ineffective. The record does not show that the trial judge, disregarding the pleadings, determined that question, or considered it at all. Certain it is also that no such question was considered when the case was in this court (253 N. Y. 592). We think it is still open, unaffected by the, former judgment. , .

(2) The former judgment not availing as a bar or an estoppel, we have yet to determine whether the approval of the Commission is invalid because of failure of proof of a franchise presently existing.

Public Service Commission Law, section 68, provides: No gas corporation or electric corporation shall begin construction of a gas plant or electric plant without first having obtained the permission and approval of the commission. No such corporation shall exercise any right or privilege under any franchise hereafter granted or under any franchise heretofore granted, but not heretofore actually exercised, or the exercise of which shall have been suspended for more than one year, without first having obtained the permission and approval of the commission. Before such certificate shall be issued a certified copy of the charter of such corporation shall be filed in the office of the commission, together with a verified statement of the president and secretary of the corporation, showing that it has received the required consent of the proper municipal authorities.”

Under this statute a consent presently operative that the petitioner occupy the highway is a condition precedent to a certificate of approval. The existence of such a consent is a fact to be proved to the Commission just as much as any other fact conditioning its action (Matter of City of Long Beach v. Public Service Comm., 249 N. Y. 480). The petitioner could not rid itself of the burden thus imposed by proving a consent lawful when given, but later lawfully revoked. The revocation, if lawful, puts the consent out of existence as effectively as if a franchise for a definite term had expired by limitation. A prop essential to approval is withdrawn, and the petition collapses with it.

We think a lawful revocation, terminating the franchise, has been established by the village. The rule is now settled that the municipal authorities consenting to a franchise for the occupation of the public streets, may revoke the consent for nonuser of the privilege (New York Electric Lines Co. v. Empire City Subway Co., 235 U. S. 179, 194; New York Electric Lines v. Gaynor, 218 N. Y. 417; Village of Stillwater v. Hudson Valley Ry. Co., 255 N. Y. 144). The revocation, if based upon sufficient grounds, is effective, without previous adjudication, from the time it is declared, just as it would be effective in like circumstances to terminate a private grant. In the one case as in the other the declaration is not conclusive. The adequacy of the cause, if contested by the holder of the grant, must be considered and determined. Even so, the determination, when made, is not the operative act that extinguishes the grant; it is merely the approval and registration of an election previously declared. The resolution in such case serves to define the attitude of the public authorities, and to revoke the permission where sufficient ground exists for such revocation” (New York Electric Lines Co. v. Empire City Subway Co., supra at 195).

Sufficient grounds there plainly were for the recall of this consent. For nearly thirty years nothing had been done by Smith or his assigns either in the fulfillment of the fighting contract with the village or in the use of the franchise that had been given in aid of its performance. Then, with Smith in his grave, a fighting corporation unearths the stale grant, so long neglected and forgotten, and makes proof of an assignment obtained from the executors, to continue an occupation that had been declared to be illegal. The evidence of abandonment could hardly have been clearer if the petitioner had come forward after inaction for a century.

The argument is made that revocation, even if permissible, had not been adequately declared when the Commission certified approval, and that in the absence of revocation the franchise still subsisted. The facts, we think, are to the contrary. A' resolution terminating a franchise for breach of a condition, is not required to follow a particular form. There is no need to use the word revoke ” or any other term of art. All that is needed is that the election be so expressed as to make intention reasonably apparent when words are interpreted in the setting of the circumstances. The test was fully met. As soon as the application for a certificate was made to the Commission, the Board of Trustees adopted a resolution directing counsel for the village to oppose the granting of the petition. Following this resolution the village served an answer, verified by the Mayor, in which it denied that the petitioner or its predecessors in title had any privilege or franchise to occupy the village streets under the resolution of the Board passed in March, 1899, or by any other consent or grant. This could only mean, in the setting of the circumstances, that the franchise of March, 1899, was no longer in existence. Upon the hearing before the Commission, counsel for the village stated as one of the grounds of opposition that there had been a forfeiture of the consent by reason of nonuser. No objection was made, so far as the record now informs us, that the form of the resolution was insufficient to establish revocation. The petition for rehearing gave notice to the Commission that within a fortnight following its certificate another resolution, revoking the consent with all possible formality, had been spread upon the records. Even if we disregard the later resolution on the ground that a petition for a rehearing invokes the exercise of discretion (People ex rel. New York & Queens Gas Co. v. Straus, 182 App. Div. 666; Public Service Commission Law, § 72), we think what had been done already was a disclosure of an election too plain to be misread.

In what has been written we have assumed in favor of the appellant that the nonuser of the franchise is the breach of a condition subsequent, with the result that the privilege survives until revoked. Such is commonly the effect (New York Electric Lines Co. v. Empire City Subway, Co. supra). The nature of the condition, whether precedent or subsequent, is, however, a question of intention, dependent for its solution upon the terms of the enabling statute and the language of the grant (Vroom v. Tilly, 184 N. Y. 168). We are not required to determine whether this particular franchise is so connected with a contract for the lighting of the streets and public buildings (Village Law; Cons. Laws, ch. 64 § 240) that failure to act thereunder within a reasonable time is a breach of a condition precedent or at least of one concurrent. We leave that question open.

The order should be affirmed with costs.

Pound, Crane, Lehman, Kellogg, O’Brien and Hubbs, JJ., concur.

Order affirmed.


text:
    In the Matter of Proving the Will of Mabel P. Daggett, Deceased. John D. Daggett, Appellant; Chatham Phenix National Bank and Trust Company, as Executor, Respondent.

      (Argued November 17, 1930;
    decided January 6, 1931.)

      Henry Hirschberg• for appellant.
    The domicile of testatrix was the county of Orange at the time of her death, being the conceded domicile and residence of her husband and no adequate reason for a separate domicile on her part being established. (Hunt v. Hunt, 72 N. Y. 217; Hammond v. Hammond, 103 App. Div. 437; Harris v. Harris, 83 App. Div. 123; Matter of Green, 99 Misc. Rep. 582; 179 App. Div. 890; Barber v. Barber, 89 Misc. Rep. 519; Matter of Bushbey, 59 Misc. Rep. 317; Jones v. Jones, 8 Misc. Rep. 660; McGowan v. McGowan, 18 Misc. Rep. 708; 164 N. Y. 558; Atherton v. Atherton, 181 U. S. 155; Haddock v. Haddock, 201 U. S. 562; Post v. Post, 71 Misc. Rep. 44; 210 N. Y. 607; Wacker v. Wacker, 154 App. Div. 495; Callahan v. Callahan, 65 Misc. Rep. 172; Matter of Florence, 54 Hun, 328; Matter of Thorne, 240 N. Y. 444; Shute v. Sargent, 67 N. H. 305; Matter of Newcomb, 192 N. Y. 238; Flatauer v. Loser, 156 App. Div. 591; Bolton v. Schriever, 135 N. Y. 65; Matter of Green, 186 App. Div. 903.)

      Cornell S. Dikeman and Milton Kunen for respondent.
    It was within testatrix’s power to acquire a domicile in New York city. (Matter of Florence, 54 Hun, 328; Matter of Walker, 54 Misc. Rep. 177; Matter of Crosby, 85 Misc. Rep. 679; Matter of Thorne, 240 N. Y. 444; Shute v. Sargent, 67 N. H. 305; Matter of Brown, 133 Misc. Rep. 457; Flatauer v. Loser, 156 App. Div. 591; Bolton v. Schriever, 135 N. Y. 65.)
   Pound, J.

The question is whether the Surrogate’s Court of New York county or the Surrogate’s Court of Orange county has exclusive jurisdiction of proceedings to probate the will of Mabel Potter Daggett, deceased. (Surrogate’s Court Act, § 45, subd: 1.) Of which county was testatrix a resident at the time of her death? It has been held that she was a resident of New York county.

The executor named in the will, Chatham Phenix National Bank and Trust Company, alleges in its petition that Mrs. Daggett was a resident of New York county. She so describes herself in the will and elsewhere. Her husband, John D. Daggett, contesting probate in New York county, alleges that she resided in Orange county where he resides and the petition for probate alleges that he resides. The singular anomaly is presented of husband and wife living together in perfect harmony coupled with a decision that they may have separate residences for the purpose of probate jurisdiction. The permanent family home at the time of the wife’s death was in Orange county. Of that there can be no doubt. The home belonged to the wife; the husband lived in his wife’s home. She was a writer and seems to have been a person of independent means. She, in fact, determined substantially all questions of the movements of herself and her husband. Sometimes they were abroad and sometimes in New York, as her pleasure or business dictated. She took him with her from place to place but they always came back to the Orange county home.

The word residence,” while it may not be for all purposes of probate synonymous with domicile ” (Matter of Newcomb, 192 N. Y. 238, 250), is identical in meaning so far as the question arising in this case is concerned. (Kennedy v. Ryall, 67 N. Y. 379, 386.)

If Mrs. Daggett had been a single woman, she would have been free to select her own residence or domicile without let or hindrance; to elect between her country home and the city with no better reason than her desire to have her will proved and her estate settled in one county rather than another (Matter of Newcomb, supra), but she was a married woman and a married woman cannot, to suit her • convenience or pleasure merely, create a legal residence for herself apart from that of her husband.

A woman upon marriage takes the domicile of her husband by operation of law and the legal domicile of the wife is prima facie that of her husband. (Hunt v. Hunt, 72 N. Y. 217, 242.) This rule, no doubt, is a creation and a survival of the theory of the common law that her very being was merged in that of her husband. (Williamson v. Osenton, 232 U. S. 619.) Modern statutes have done much to give married women a legal status apart from their husbands but the wife is still the subordinate in many ways. (Allen v. Allen, 246 N. Y. 571.) Unity of person no longer exists but the husband is still the head of the family, the bread-winner in theory and duty if not in fact. He selects the place of abode of the family and it is the duty of the wife to abide by his decision unless it is unsafe or imprudent for her to do so. (Powell v. Powell, 29 Vt. 148, 150.) If, in fact, as in this case, the husband chooses to live with the wife in her home, her status remains unchanged. It is his choice that governs, not hers, until he forfeits it. If Mr. Daggett had elected to leave the Orange county home he might have taken his wife with him to his new domicile. Even her physical presence would not be required to effect the change. Her domicile or residence would follow his. (Hunt v. Hunt, supra.) Otherwise she might choose her domicile in New York while he elected to reside in Orange county. We sometimes hear of amicable married couples living apart by consent (Matter of Florance, 54 Hun, 328; Matter of Crosby, 85 Misc. Rep. 679), but that is not the case we have before us. (Dean v. Dean, 241 N. Y. 240, 244.)

Mr. Daggett says he resided in Orange county in his wife’s home at the time of her death. Indubitably such was the fact. He says he made it his domicile. Neither had any other fixed place of abode. They stopped in New York transiently in hotels. She went to New York for hospital care before she died. In no way did he indicate any acquiescence in her desire that New York should be their place of abode, their residence, their domicile, for any purpose.

As was said in Matter of Thorne (240 N. Y. 444), the identity of person of husband and wife is no longer a fetish of the law.” The rule that a married woman’s domicile is always that of her husband has been greatly modified in this country. ■ She may, when justified by her husband’s conduct toward her in leaving him, make her home apart from him to establish a domicile to sue for divorce and perhaps for all purposes. (Williamson v. Osenton, supra; Dean v. Dean, supra.) We are asked to add another exception to the general rule to include the independent right of domicile of the married woman who is the actual if not the titular head of the family. But it has never been held that a married woman of means may establish a separate domicile by doing those things which would establish a domicile for her husband. Married women have, very properly, a wealth of freedom as compared to that granted to them by the common law, but they may not in this State, until the Legislature acts, sue their husbands for damages for personal injuries (Allen v. Allen, supra), nor acquire a separate domicile whenever they so elect when they have no justification or excuse for leaving their husbands. While it has been aptly suggested, in a matrimonial case and as mere dictum, that “ no reason would seem to remain why she may not acquire a separate domicile for-every purpose known to the law ” (Shute v. Sargent, 67 N. H. 305), and while this argument may seem particularly applicable when the wife so acts for the purpose of voting or for having her will probated, we must await the enactment of legislation before we can say that no disabilities on account of sex and marriage shall be recognized by the courts.

The orders should be reversed and the proceedings dismissed, with costs in all courts payable out of the estate.

Cardozo, Ch. J., Crane, Lehman, Kellogg, O’Brien and Hubbs, JJ., concur.

Ordered accordingly.


author: Hubbs, J.

text:
    In the Matter of the Accounting of the Equitable Trust Company of New York, as Executor of Della E. V. Martin, Deceased, Respondent. James Burke, Appellant; Thomas Bourke et al., Respondents.

      (Argued November 24, 1930;
    decided January 6, 1931.)

      Thomas I. Sheridan, Arthur F. Mullen and Daniel J. Madigan for appellant.
    The residuary clause of the will plainly bequeaths the residue of the estate to appellant, sole surviving brother of the deceased, as the nearest relative living at the date of death of the deceased. (Ennis v. Pentz, 3 Bradf. 382; Haas v. Speenburgh, 203 N. Y. Supp. 202; Matter of Brown, 232 N. Y. Supp. 204; Smith v. Campbell, 19 Ves. Jr. 400; Hammond v. Myers, 292 Ill. 270; Clark v. Mack, 161 Mich. 545; Locke v. Locke, 45 N. J. Eq. 97; Matter of Altdorfer, 225 Penn. St. 136; Keniston v. Mayhew, 169 Mass. 166; Leonard v. Haworth, 171 Mass. 486; Jones v. Parsons, 182 Iowa, 1377; Matter of Weaver, 140 Iowa, 615; Swasey v. Jacques, 144 Mass. 135; Redmond v. Burroughs, 63 N. C. 242; Smith v. Egan, 258 Mo. 569; Marsh v. Marsh, 1 Brown Ch. Rep. 293;
      Brandon v. Brandon, 111 Swantson’s Rep. 312; Matter of Buechner, 226 N. Y. 440; Matter of Fletcher’s Estate, 220 N. Y. Supp. 645; 246 N. Y. 552; Matter of King, 213 N. Y. Supp. 131; Matter of Richardson, 229 N. Y. Supp. 299; Matter of Darmtrey, 211 N. Y. Supp. 529; Baxter v. Marrs, 228 N. Y. Supp. 587.) The fact that the class designated nearest relations is comprised of only one person does not affect the gift so made by will. (Matter of King, 200 N. Y. 189; Matter of Kimberly, 150 N. Y. 90; Matter of Russell, 168 N. Y. 169; Palmer v. Horn, 84 N. Y. 516; Matter of Andrew, 210 N. Y. Supp. 763; Smith v. Campbell, 19 Ves. 400.) The court properly refused to permit extrinsic evidence to be introduced as the language of the will was plain and unambiguous. (Smith v. Campbell, 19 Ves. 400; Brown v. Quintard, 177 N. Y. 83; Williams v. Freeman, 83 N. Y. 569 ; Matter of Keleman, 126 N. Y. 78; Wolf v. Van Nostrand, 2 N. Y. 436; Matter of Miner, 146 N. Y. 121; Klock v. Stevens, 45 N. Y. Supp. 603; Kerr v. Bryan, 32 Hun, 53; Matter of Lyden, 119 N. Y. Supp. 974.)

      Leonard J. Obermeier, Alvin S. Rosenson, William C. Foster and George W. Cornell for respondents.
    The intention of the testatrix was that the residue of her estate should be divided among her next of kin.. (Schouler on Wills [3d ed.], § 468; Matter of Title Guarantee & Trust Co., 195 N. Y. 339; Hoppock v. Tucker, 59 N. Y. 202.) The rejection by the Surrogate of the offer of extrinsic evidence to aid in the construction of the will was error. (Baumann v. Steingester, 213 N. Y. 328; Matter of Coughlin, 171 App. Div. 662; 220 N. Y. 681; Matter of Van Vliet, 181 App. Div. 879; 224 N. Y. 572; Matter of Hendrickson, 140 App. Div. 388; Dubois v. Ray, 35 N. Y. 162; Morris v. Sickly, 133 N. Y. 456.)

      Charles G. Coster for Thomas J. Maher et al., respondents.
    The intention of the testatrix is to be gathered from the whole will. (Eidt v. Eidt, 203 N. Y. 328; Wetmore v. Parker, 52 N. Y. 462; Matter of White, 125 N. Y. 594; Phillips v. Davies, 92 N. Y. 204; Matter of Miller, 161 N. Y. 76; Trozier v. Bray, 120 N. Y. 375; Matter of Tamago, 220 N. Y. 231.)
   Hubbs, J.

Della E. V. Martin, deceased, drew her-own will. It is in her handwriting. After naming an executor, it made bequests amounting to $13,000 and also bequeathed certain personal property.

The residuary clause reads: “ The balance of my estate or money derived from sale of stocks and bonds to go to my nearest relatives last known address,-— descendants of Thomas Burke and his wife, Mary Hayes, who were my parents, address Kilmore, County Clare, Ireland, and others may be at Harvard Junction, Harvard, Illinois, U. S. America, to share alike. Should any one of the above beneficiaries be not alive at my death the money must come back to estate to be used for my relatives.”

Decedent left surviving one brother, James Burke, appellant, and numerous nephews and nieces, children of deceased brothers and a sister.

The learned Surrogate in an appropriate proceeding has decided that the appellant, James Burke, is entitled under the will to the residue of the estate.

The Appellate Division reversed the decree of the Surrogate’s Court and decided that the descendants of deceased brothers and a sister of the testatrix were entitled to share in the residuary estate per stirpes.

The opinion of the learned Surrogate is based primarily upon the ground that the testatrix intended her residuary estate to go to the relatives who were of the nearest degree of kinship, those persons who were next in blood to her and that her brother, James, is the only person occupying that relationship and, therefore, entitled to take the residuary estate to the exclusion of nephews and nieces, children of deceased brothers and a sister. The Appellate Division found in the language used in the will a contrary intent on the part of the testatrix.

' The will was inartificially drawn by a woman who was evidently unfamiliar with the technical meaning of legal terms. In the effort to determine the intent of the testatrix we are limited to the language employed by her in wording the will, as extrinsic evidence of the circumstances surrounding the testatrix and her relatives, for the purpose of aiding in determining her intent, was not received.

If the words used had been, “to go to my nearest relative ” instead of “ to my nearest relatives ” it would be clear that the residuary estate should go to her only surviving brother, James, and the nephews and nieces, children of deceased brothers and a sister, could not take under the will. Under such wording of a will, a court would not be justified in deleting the word “ nearest ” from the will. (Matter of Buechner, 226 N. Y. 440, 443.) The use of the words “ nearest relative ” would necessitate a holding that the words meant the nearest blood relative, the one in nearest degree of consanguinity. “No relative can be said to be ‘ nearest ’ in degree of blood if someone else be 1 nearer.’ ” (Matter of Weaver’s Estate, 140 Iowa, 615.)

The only cases which have passed upon the question in this jurisdiction have held that the words “ nearest relatives ” and “ nearest kin ” when used in a will refer to those in the nearest degree of consanguinity. (Ennis v. Pentz, 3 Bradf. 382; Haas v. Speenburgh, 122 Misc. Rep. 458; Matter of Brown, 133 Misc. Rep. 519.)

That is the rule in England (Brandon v. Brandon, 3 Swanston’s Ch. Rep. 312; Withy v. Mangles, 10 Clark & Finnelly’s Rep. 215; 8 Jur. 69) and in other States (Hammond v. Myers, 292 Ill. 270; Clark v. Mack, 161 Mich. 545; Locke v. Locke, 45 N. J. Eq. 97; Matter of Altdorfer’s Estate, 225 Penn. St. 136; Keniston v. Mayhew, 169 Mass. 166; Jones v. Parsons, 182 Iowa, 1377).

In the case at bar, if the deceased had left her surviving two brothers, or two sisters, or a brother and sister, there could be no doubt that such survivors would take under the residuary clause of the will to the exclusion of nephews and nieces, children of deceased brothers and a sister, for they would be within the exact words of the will, “ nearest relatives.”

It is urged by respondents that those rules of construction are not applicable, because other language contained in the will indicates that the testatrix intended that all blood relatives direct descendants of her parents should take under the residuary clause.

It is urged that the use of the words nearest relatives ” in the plural indicates that testatrix expected that more than one relative would take under said clause; also that the addresses given indicated that testatrix anticipated that more than one person would take under said clause.

The argument is based on the assumption that testatrix knew at the time she drew her will, about a year before her death, that she had only one living brother. If the record disclosed that she knew at that time that she did not have a living sister and had only one living brother who resided at Kilmore, County Clare, Ireland, the words and others may be at Harvard Junction, Harvard, Illinois,” would be persuasive that she intended that relatives other than the brother should also take under the residuary clause.

In the absence of evidence, we are not permitted to indulge in the presumption that she had such knowledge, or even that such was the fact at the date of the will. We are required to interpret the will as it reads, giving due consideration and weight to all its parts. The will read as a whole indicates that she did not know the address or places of residence of her brothers and sister if living. If she did not have such knowledge, we cannot assume that she knew whether all or any of them had died. If two or more were alive the words used expressed her intent that they should take the residuary estate as they would clearly be the nearest relatives.” The bequest was to a class — the nearest relatives.” (Matter of Westchester Trust Co., 173 App. Div. 403; affd., 219 N. Y. 638.)

If there had existed at the time the will took effect more than one member of the class, the use of the plural relatives ” would have been accurate. In fact, only one member of the class, the brother, James, was living as survivor of the class. In construing the will upon the record now before us it appears that he is entitled to take the whole estate. (Matter of Westchester Trust Co., supra.) It was error, however, for the Surrogate, upon the rehearing, to refuse to receive extrinsic evidence of the circumstances surrounding the testatrix and her relatives for the purpose of affording aid in determining her intent. In interpreting a will, the cardinal rule of construction is to so construe it as to carry out the intent of the testator.

The intent of the testatrix cannot be ascertained with reasonable certainty from the will itself. Under such circumstances extrinsic evidence should have been received for the purpose of aiding the court in ascertaining the real intent of the testatrix. (Morris v. Sickly, 133 N. Y. 456; Baumann v. Steingester, 213 N. Y. 328; Matter of Coughlin, 171 App. Div. 662; affd., 220 N. Y. 681.)

The appeal to the Appellate Division from the order and decree of the Surrogate brought up to that court for review the whole order and decree, and the appeal to this court has the same effect. The refusal of the Surrogate to receive the evidence offered bearing upon the question of the intent of the testatrix constituted an integral part of the order appealed from and vests in this court authority to correct the error of the Surrogate by directing a rehearing so that the evidence erroneously rejected may be received.

The order of the Appellate Division and the order and decree of the Surrogate’s Court should be reversed, and a rehearing granted, with costs in the Appellate Division and in this court payable out of the estate.

Cardozo, Ch. J., Pound, Crane, Lehman, Kellogg and O’Brien, JJ., concur.

Ordered accordingly.


author: Kellogg, J.

text:
    In the Matter of the Will of Ida R. Opdyke, Deceased. (Two proceedings.) In the Matter of the Accounting of Wilson C. Price, as Executor of Ida R. Opdyke, Deceased. Southern Baptist Convention, Appellant; Wilbur F. Opdyke, Respondent.
    (Argued November 24, 1930;
    decided January 6, 1931.)

      J. Russell Rogerson for appellant.
    The bequest to appellant does not violate the provisions of section 17 of the Decedent Estate Law. (Amherst College v. Ritch, 151 N. Y. 334; Hollis v. Drew Theological Seminary, 95 N. Y. 166.)

      Ernest Cawcroft and H. Stanley Turnguist for respondent.
    The statute must be applied to the testament and the estate, valued as of the day of death. A gift to a charitable corporation is a general legacy for a fixed sum. (Matter of Carnegie, 117 Misc. Rep. 806; 236 N. Y. 517; Matter of Blumenthal, 124 Misc. Rep. 850; Matter of Brooklyn Trust Co., 179 App. Div. 262; Matter of Johnson, 76 Misc. Rep. 391; Matter of Donchian, 128 Misc. Rep. 51; Matter of Arnolt, 127 Misc. Rep. 579; Matter of Shiman, 130 Misc. Rep. 716; Matter of Bulliard, 130 Misc. Rep. 337; Matter of Ham, 123 Misc. Rep. 889; Matter of Merritt, 124 Misc. Rep. 709; Matter of Fisher v. Lister, 130 Misc. Rep. 1; Matter of Beck, 130 Misc. Rep. 765; Matter of Allen, 111 Misc. Rep. 93.) Section 17 of the Decedent Estate Law must be applied to the charitable gift even though the testatrix bequeathed less than one-half of her estate to the appellant. The law became applicable the moment the accounting proceeding revealed that the profits and increases accruing since death were in excess of one-half of her net estate, valued.as of the day of death. (Matter of Sugden, 223 App. Div. 844; 249 N. Y. 541.) The profits and increases on the charitable unit of the estate were an intestacy. (Matter of Mould, 117 Misc. Rep. 1; Matter of Evans, 37 Misc. Rep. 475; Matter of Walker, 136 N. Y. 20; Barber v. Terry, 173 App. Div. 469; Matter of Deming; 174 N. Y. Supp. 175; Abbott v. James,
      111 N. Y. 673; Knickerbocker Trust Co. v. King, 126 App. Div. 691; Matter of Grossman, 131 Misc. Rep. 526; Matter of Slattery, 132 Misc. Rep. 319; Clark v. Cammann, 160 N. Y. 328; Lefevre v. Lefevre, 59 N. Y. 434; Matter of Hayman, 134 Misc. Rep. 803; Wright v. Wright, 225 N. Y. 329; Matter of Hoffman, 201. N. Y. 247; Matter of Gallien, 247 N. Y. 195.)
   Kellogg, J.

The last will of Ida R. Opdyke directed that after the payment of her debts and funeral expenses, and the satisfaction of certain minor legacies of furniture, silverware and the like, “ All of the rest, residue and remainder of my property of every sort and description shall be divided into two equal parts.” Out of one part she bequeathed the sum of $5,000 to the First Baptist Church of Jamestown, N. Y. “ The balance of this one-half of my estate ” she devised and bequeathed, for educational purposes, to the Southern Baptist Convention. The other one-half part she devised and bequeathed to a trustee upon certain trusts for her son Wilbur F. Opdyke, her grandson George Francis Opdyke, and the issue of the latter, the nature of which is not material upon this inquiry.

The Decedent Estate Law (Cons. Laws, ch. 13), in section 17, as it read when the testatrix died, provided as follows: “No person having a husband, wife, child or parent, shall, by his or her last will and testament, devise or bequeath to any benevolent, charitable, literary, scientific, religious or missionary society, association, corporation or purpose, in trust or otherwise, more than one-half part of his or her estate, after the payment of his or her debts, and such devise or bequest shall be valid to the extent of one-half, and no more.” (L. 1923, ch. 301.) It is not possible to discover wherein these provisions have the remotest applicability to the will under consideration. The statute forbade Ida R. Opdyke, having a son, to devise or bequeath to any religious society “ more than one-half part ” of her estate. Ida R. Opdyke did bequeath “ one-half part” of her net estate to religious uses; she made no other bequests to such uses. Consequently, stricter compliance with the provisions of the statute, than •.as shown by her will, is unimaginable.

• The assets of the estate, appraised as of the time of death of the testatrix, had an approximate value of $400,000. Due to advantageous sales of her securities, made subsequently to her death, the assets now have a value of approximately $600,000. It has been held, Under the supposed authority of Matter of Seymour (239 N. Y. 259), that the statute did not permit the testatrix 'to leave to religious uses more than $200,000, or one-half of her estate at the date of her death, as then valued; consequently, that $100,000, the gain subsequently accruing upon that one-half, could not pass to the religious society named. The result flowing from this holding is curious: The gain which the society may not take does "iiot pass into the trust fund, for the reason that such fund is to be erected “ out of the other half,” and the gain does not proceed from such half. Consequently, as to it there is an intestacy. Yet, the gain accruing upon ‘the $200,000, which the trustee takes, emerges out of the other one-half” and constitutes a part __ thereof. Apparently, there are involved, in the holding, these anomalies: That there may be two unequal halves of the same thing; that a gift of two halves is a gift of less than the whole; that a bequest of “all the rest, residue and' remainder of my property of every sort and description ” is a gift only of a part. The explanation given is that the same thing is not halved; that one-half of an estate given to non-charitable purposes is one-half of the entire estate transferred; whereas, given to charities, it may not be, under the statute, more than one-half of the estate as valued at the date of the testator’s death. In point of fact, the statute makes no such provision, since its prohibition runs only against a gift by a testator of more than one-half part of his or her estate.”

There may be cases where the content of a will does not disclose the ratio between the sum given to charities and the total sum which the testator’s death is operative to transfer; where reference must be made to facts appearing extrinsieally to determine whether a charitable gift exceeds “ one-half part ” of the estate, and, if so, how great the prohibited excess may be. The determining factor, the total sum transferred, must be ascertained by a valuation of the testator’s assets at the date of his death, or by a reference to their value at the date of distribution. It is necessary that the one standard or the other should be chosen, for the factor, establishing or disproving a statutory violation, should be constant. Logically, a valuation at the time of the testator’s death is the base which should be chosen; for, that being the moment when the transfer and the will become operative, at that time the testator has or has not made a bequest in violation of the statute. Such was the rule laid down in Matter of Seymour (supra) and Matter of Sugden (249 N. Y. 541). In the former, Judge Andrews, stating that the base of the computation must be the valuation at the testator’s death, said: “As of that time the value of the estate is to be fixed upon the same basis as if it had been then turned into cash and the amount which a charitable corporation may receive then determined.” In so holding the court merely reaffirmed the doctrine laid down in Hollis v. Drew Theological Seminary (95 N. Y. 166, 178), where Judge Earl said: “ To ascertain whether a testator has given more than one-half of his estate, his whole estate must be treated as converted into money at his death, and if the money value of the portion given is not more than one-half, then the statute has not been violated.”

In our case the testatrix has in express words provided that one-half of her net estate and no more shaE pass to religious uses. No matter what the estate might be, whether it gained or lost through administration, one-half part, through the medium of a trust, was to pass to the descendants of the testatrix, and a one-half part of the same estate was to pass to religious societies. Obviously the will did not violate the statute, and no computation could affect the unalterable fact. Therefore, the computation, found necessary in Matter of Seymour (supra) and Matter of Sugden (supra), is wholly needless here and the rules of calculation therein laid down have no application. The religious societies, on distribution, must together receive a sum equal to a one-half part of the then net estate, as directed in plain terms by the testatrix.

The order should be modified in accordance with this opinion and, as modified, affirmed, with costs to the appellant.

Carduzo, Ch. J., Pound, Crane, Lehman, O’Brien and Hubbs, JJ., concur.

Ordered accordingly.


author: Crane, J.

text:
    Charles A. Benton, Respondent, v. Safe Deposit Bank of Pottsville, Pennsylvania, Appellant.

      (Submitted November 21, 1930;
    decided January 6, 1931.)

      George N. Hamlin for appellant.
    Under the law of Pennsylvania, the plaintiff has no cause of action against the defendant in negligence or contract for failure to record the collateral trust agreement, because of the clauses in that agreement relieving the defendant from any obligation to record the instrument and from any liability save for its gross negligence or willful default. The agreement was delivered and the trusts therein accepted in the State of Pennsylvania. As no cause of action arose in that State against the defendant, none can be enforced in the courts of New York, even though such a clause may be there regarded as against public policy. (Bell v. Title Trust & Guarantee Co., 292 Penn. St. 228; Byers v. Union Trust Co., 175 Penn. St. 318; Green v. Title Guarantee & Trust Co., 223 App. Div. 12; McClelland v. Norfolk So. R. R. Co., 110 N. Y. 469; National Salt Co. v. Ingraham, 122 Fed. Rep. 40; McClure v. Oxford, 94 U. S. 429; Babbitt v. Read, 236 Fed. Rep. 42; Davidge v. Guardian Trust Co., 203 N. Y. 331; Gra

      ham v. First Nat. Bank, 84 N. Y. 393; Knowlton v. Erie R. R. Co., 19 Ohio St. 260; Cleveland, C., C. & St. L. R. Co. v. Druien, 80 S. W. Rep. 778; The Trinacaria, 42 Fed. Rep. 863; Baetjer v. LaCompagnie, 59 Fed. Rep. 789; Forepaugh v. D., L. & W. R. R. Co., 128 Penn. St. 217; Canaday v. Atlantic Coastline R. R. Co., 143 N. C. 439; Cohn v. Adams Express Co., 170 Ill. App. 174.). The provisions in the trust agreement relieving the trustee from any duty to record the instrument and those relieving it from liability save for its gross negligence or willful default are not against public policy. They are the subject alone of private agreement in which the public has no interest, and which it is the highest public policy to enforce. (Cole v. Goodwin, 19 Wend. 251; Parrill v. Cleveland, C., C. & St. L. Ry. Co., 23 Ind. App. 638; Railroad Co. v. Lockwood, 17 Wall. 357; Checkley v. Illinois Central R. R. Co., 257 Ill. 491; Insman & Co. v. Seaboard Air Line Ry. Co., 159 Fed. Rep. 960; Santa Fe Ry. Co. v. Grant Bros., 228 U. S. 177; Cleveland, C., C. & St. L. Ry. Co. v. Henry, 170 Ind., 94; Ferrarri v. N. Y. C. & H. R. R. R. Co., 162 App. Div. 6; 220 N. Y. 712; Browning v. Fidelity Trust Co., 250 Fed. Rep. 321; Tuttle v. Gilmore, 36 N. J. Eq. 617; Black v. Wiedersheim, 143 Fed. Rep. 359; Ainsa v. Mercantile Trust Co., 163 Pac. Rep. 898; Bell v. Title Guarantee & Trust Co., 292 Penn. St. 228; Byers v. Union Trust Co., 175 Penn. St. 318; Newhall v. Norristown Trust Co., 124 Atl. Rep. 337.)

      Karl R. Miner for respondent.
    The defendant is liable for its failure to record the mortgage. (Miles v. Vivian, 79 Fed. Rep. 851; Green v. Title Guarantee & Trust Co., 223 App. Div. 16.)
   Crane, J.

The liability to bondholders of a trustee under a trust mortgage for failure to record the mortgage is the question brought up for review by this appeal.. The plaintiff is the holder of two first and collateral trust mortgage six per cent gold notes of the Kresge Coal Company, payable November 1, 1923. The coal company is a corporation organized and existing under the laws of the State of Delaware and the Safe Deposit Bank of Pottsville, Pennsylvania, is a corporation existing under and by virtue of the laws of that State, having its principal office and place of business at Pottsville. The notes held by the plaintiff are part of a total authorized issue of notes numbered from 1 to 100, inclusive, made by the said Kresge Coal Company, aggregating the total principal sum of $100,000, and containing on their face the recital, “ which notes have been issued under and are equally and ratably secured without privilege, priority or distinction by a Collateral Trust Agreement made by the Company to the Safe Deposit Bank of Pottsville, Trustee, dated April 16, 1923, to which reference is hereby made with the same effect as if herein fully set forth, which Collateral Trust Agreement is duly recorded and is a hen on all the property, plant, equipment, and other assets of the Company, and subject to all of the terms of which Collateral Trust Agreement this note is issued and held.” The note is signed by the officers of the Kresge Coal Company, and contains the indorsement of the trustee as follows.

“ Trustee’s Certificate
This note is one of the notes secured by the within mentioned Collateral Trust Agreement.
“ SAFE DEPOSIT BANK OF POTTSVILLE
“ Trustee.”

Turning to the mortgage to determine the duties and obligations assumed by the trustee, we find it the usual lengthy instrument containing the following pertinent paragraphs:

First. No note issued hereunder shall have any validity or be binding in any manner whatsoever unless the certificate of the Trustee shall have been endorsed thereon, which certificate shall be as above recited.

“ Twenty-first. * * *

(b) * * * The Trustee, save for its gross negligence or wilful default, shall not be personally hable for any loss or damage.

a * * *

“ (e) Only such notes as shall have endorsed thereon a certificate in substantially the form hereinbefore recited duly signed by the Trustee, shall be of the said series of notes. Such certificate shall be only for the purpose of identification of the said notes as of said series, payment whereof is intended to be secured by this mortgage, and Trustee shall not be responsible for the execution of said notes or of this mortgate, or for the title of Coal Company to the property, premises or rights described herein, or for the validity or priority of the hen or charge purporting to be hereby created, or for the sufficiency of the security provided herein, or for the genuineness, validity or value of any property or securities which may at any time become subject to this Indenture.

II * *

(h) It shall be no part of the duty of the Trustee to record this instrument as a mortgage or conveyance of real or personal estate, or to file or record the same as a chattel mortgage, to re-file or renew the same, or to procure any further, other or additional instruments or further assurance, or to do any other act for the continuance of the hen of this Indenture. * * * ”

The mortgage was not recorded, and the notes, not having been paid, the plaintiff has sued the trustee for its neghgence in failing to have the mortgage placed on record, and has recovered the face value of his notes, with interest. In purchasing the notes, the plaintiff relied upon no false or fraudulent representations made by the trustee which would present an entirely different case. (Doyle v. Chatham & Phenix Nat. Bank, 253 N. Y. 369.) Neither does the plaintiff claim to have been misled or deceived by the form or wording of the trustee’s certificate, indorsed on the notes. That merely stated that the note was one of the series secured by the collateral trust agreement mentioned on the face of the note. A reference to that agreement shows that the trustee undertook to certify to identification only, and not to the validity or security of the note. The judgment which the plaintiff has recovered rests entirely upon the theory that it was a duty of the trustee which it owed to the noteholders to see that the mortgage was recorded, and that the failure to record the mortgage was the neglect and carelessness of the trustee, for which it is hable to those noteholders, including the plaintiff, who have suffered damage thereby.

The duty of the trustee is measured and limited by its agreement. This, as we see by the above quotations, exempted it from liability except for gross negligence or wilful default, and stated that the trustee was under no duty to record the instrument. Such agreements are legal and binding, unless they are contrary to some statute or against the public policy of the State. We can see no reason why such an agreement is not binding upon the mortgagor and the trustee, and those who have purchased the notes with notice of the mortgage and opportunity to fully examine its terms and conditions.

This mortgage was made and executed in Pennsylvania. The notes were issued and payable in Pottsville, Pennsylvania. The law of Pennsylvania applies to these contracts: “ * * * The general rule is that a contract made in one State and to be performed there is governed by the law of that State, and the further rule, which is a logical result, that a defense or discharge, good by the law of the place where the contract is made or to be performed, is to be held, in most cases, of equal validity elsewhere.” (Graham v. First Nat. Bank, 84 N. Y. 393, 401; Curtis v. Delaware, L. & W. R. R. Co., 74 N. Y. 116, 120.) As to negligence, the law of the place where the negligent act was committed or liability arose likewise governs. (Fitzpatrick v. International Ry. Co., 252 N. Y. 127; American Law Institute, Restatement No. 4, Conflict of Laws, §§ 411-420.)

By the law of the State of Pennsylvania, no liability would attach to this trustee by reason of the alleged negligence; the contract specifying its duties and obligations as well as its liability is legal. (Bell v. Title Trust & Guarantee Co., 292 Penn. St. 228; Byers v. Union Trust Co., 175 Penn. St. 318.) In the Bell case the court had before it a similar mortgage with a like certificate indorsed by the trustee. The mortgage was not recorded, but the court said: That requirement was not an affair of the trustee, as under the general rule a trustee’s certificate that is silent as to recording does not render the trustee liable in case the mortgage is not recorded. * * * Learning that there was such a mortgage as described in the bonds, a casual investigation would have developed the fact that this instrument was not on record, and that information, available to him [the purchaser] before7 he paid for the securities, would have alone been sufficient to put him on his guard. * * * His position is still more weakened by the fact that by the terms of the mortgage itself, as shown by quotations from it in appellee’s affidavit of defense, the trustee was definitely made exempt from responsibility as to the validity of the bonds or the disposition of the trust mortgage. The instrument distinctly declares that the * trustee shall not be under any obligation to see to the recording of this indenture or of any other instrument of further issuance; ’ and further that the authentication [the certificate] of any bond by the trustee shall not be taken to be any guarantee as to the character, status or security of such bond, but only that it is in fact one of the bonds issued hereunder,’ and the trustee was not to assume responsibility for the correctness of the recitals and statements in the trust mortgage.”

As this action has been brought in the State of New York, the courts below have been of the opinion that these provisions of the trustee’s agreement relieving the trustee from the duty of recording the instrument and from its negligence, were against the public policy of this State. We do not see how this can be, especially in view of the fact that this State, contrary to most other jurisdictions, has sanctioned agreements exempting carriers from liability for negligence (Nelson v. H. R. R. R. Co., 48 N. Y. 498; Cragin v. N. Y. C. R. R. Co., 51 N. Y. 61); a doctrine somewhat limited by our recent decision in Straus & Co. v. Canadian Pacific Ry. Co. (254 N. Y. 407). Unless there is something immoral or fundamentally unjust in the arrangement, there is no policy of our State which forbids the enforcement of contracts or agreements which are legal according to the law of the place of performance. (Loucks v. Standard Oil Co., 224 N. Y. 99, p. 111; Milliken v. Pratt, 125 Mass. 374; Shaw v. Postal Telegraph & Cable Co., 79 Miss. 670; Hughes v. Pennsylvania R. R. Co., 202 Penn. St. 222; International Harvester Co. v. McAdam, 142 Wis. 114; Knowlton v. Erie Ry. Co., 19 Ohio St. 260.)

In the absence of any gross or wilful negligence there was nothing immoral about this trustee’s agreement. Considering its slight financial interest in the transaction, the bank was merely prudent and cautious in limiting its liability and defining its duties. The plaintiff could have ascertained all the facts upon inquiry; nothing was hidden or concealed. Such agreements have been recognized by the courts. (Browning v. Fidelity Trust Co., 250 Fed. Rep. 321.) Even those jurisdictions which do not recognize contracts exempting one from liability for negligence, limit the rule to a certain class of cases. (Santa Fe P. & P. Ry. Co. v. Grant Bros. Const. Co., 228 U. S. 177.)

The judgments should be reversed and the complaint dismissed, with costs in all courts.

Cardozo, Ch. J., Pound, Lehman, Kellogg, O’Brien and Hubbs, JJ., concur.

Judgments reversed, etc.


text:
    Allan Fox Company, Inc., Appellant and Respondent, v. Ignatz Wohl, Respondent and Appellant.
    (Argued November 24, 1930;
    decided January 6, 1931.)

      Frederick W. Bitter for plaintiff, appellant and respondent.
    The plaintiff was employed by the defendant. (McKnight v. McGuire, 117 Misc. Rep. 306; Pease & Elliman, Inc., v. Gladwin Realty Co., 216 App. Div. 421; Parker v. Simon, 231 N. Y. 503.) The defendant agreed with the plaintiff that he would carry out the principal contract to exchange properties. (Parker v. Simon, 231 N. Y. 503; Pease & Elliman, Inc., v. Gladwin Realty Co., 216 App. Div. 421; McKnight v. McGuire, 117 Misc. Rep. 306; Starr v. Blumenthal, 132 Misc. Rep. 222; Arndt v. Miller, Daybill & Co., 48 Misc. Rep. 612; James v. Home of Sons & Daughters of Israel, 153 N. Y. Supp. 169; Niesen v. Galewski, 211 App. Div. 858; 240 N. Y. 652; Windman v. Bulkowstein, 168 N. Y. Supp. 57.) The second cause of action was sufficient in law, and the Appellate Division erred in dismissing it. (Mulhall v. Bradley & Currier Co., 50 App. Div. 179; Hevia v. Wheelock, 162 App. Div. 759; Windman v. Bulkowstein, 168 N. Y. Supp. 57; Calkins v. Woolworth Co., 27 Fed. Rep. [2d] 314; Eichenbaum v. Taxicab Ind. Owners Auto Mut. Cas. Co., 135 Misc. Rep. 339; Morgan v. Whatley & Whatley, 205 Ala. 170; Eells Bros. v. Parsons, 109 N. W. Rep. 1098; Brawner v. Cumbie, 264 S. W. Rep. 497; The amendment of the verdict by the trial court was proper. (Hodgkins v. Mead, 119 N. Y. 166; Amory v. Washington Steamboat Co., 120 App. Div. 818; Isbell-Porter Co. v. Braker, 120 App. Div. 384.)

      Alexander Pfeiffer and Jesse H. Barkin for defendant, respondent and appellant.
    The second cause of action was insufficient in law and was properly dismissed by the Appellate Division. (Parker v. Simon, 231 N. Y. 503; Mulhall v. Bradley & Currier Co., 50 App. Div. 179; Hevia v. Wheelock, 162 App. Div. 759; Windman v. Bulkowstein, 168 N. Y. Supp. 57; Eichenbaum v. Taxicab Ind. Owners Auto Mut. Cas. Co., 135 Misc. Rep. 339; Pease & Elliman, Inc., v. Gladwin Realty Co., 216 App. Div. 421; James v. Sons & Daughters of Israel, 153 N. Y. Supp. 169; McKnight v. McGuire, 117 Misc. Rep. 306.) The amendment of the verdict by the trial court was improper and constituted reversible error. (Amory v. Washington Steamboat Co., 120 App. Div. 818; Isbell-Porter Co. v. Braker, 120 App. Div. 384.)
   Pound, J.

The complaint states two causes of action. The first is for $2,500, brokerage commissions of five per cent on a valuation of $50,000 earned by plaintiff by procuring a purchaser of defendant’s real property on an exchange basis under contract of May 19, 1928. The second is for damages in the sum of $7,350, for loss of commissions which plaintiff would have earned with the knowledge and approval of defendant from William Klein for obtaining a purchaser of his property on an exchange basis. The evidence establishes that plaintiff brought defendant and Klein together to exchange their properties on agreed terms and performed all the conditions of his employment and that defendant refused to complete the agreement.

The jury rendered a sealed verdict in which they said: “ We find a verdict for the plaintiff,” without stating the amount. The plaintiff immediately when the verdict was handed up made a motion to correct it by adding the amount demanded by the plaintiff, viz., $9,850, with interest. The motion was granted, over defendants’ objection and exception. The Appellate Division modified the judgment entered thereon by reducing the amount thereof to $2,500, dismissed the second cause of action and. held that the correction of the verdict was not error since the amounts sued on were liquidated and the plaintiff was entitled to recover the full amount or nothing.

The defendant’s appeal challenges the power of the court to correct the verdict. The court submitted to the jury the issues of bad faith and meeting of minds and said that plaintiff asked for a total sum of $9,850, and that if plaintiff failed to make out his case by a fair preponderance of the evidence the defendant should have a verdict. He did not charge that plaintiff might recover on one or both of the causes of action nor was he requested separately to submit the two causes of action. The defendant did not move to set aside the verdict on this ground nor ask for a resubmission of the case to the jury as he might have done (Porrett v. City of New York, 252 N. Y. 208), but chose to stand on the technical defect in the verdict. An amendment to the verdict is an incident of the trial. (Urband v. Lubell, 245 N. Y. 156, 158.) The court had power to correct the formal defect, to “ work it (the verdict) into form and make it serve.” (Foster v. Jackson, Hobart, 54a; Civ. Prac. Act, § 105; Hodgkins v. Mead, 119 N. Y. 166.) The court below dealt properly with the question.

As to the question raised by the plaintiff’s appeal the decisions are not in accord. It has been held that, when the broker is justified, as in this case, in arranging for a double commission (Knauss v. Krueger Brewing Co., 142 N. Y. 70), the owner by employing the broker to bring about the exchange of lands, impliedly agreed that he would carry out the contract negotiated with the third party so as to enable the broker to earn his commissions and that an action will he for damages for the owner’s refusal to carry out such agreement. (James v. Home of Sons & Daughters of Israel, [App. Term] 153 N. Y. Supp. 169.) This case was cited and distinguished but not approved or disapproved by this court in Parker v. Simon (231 N. Y. 503, 507). To the same effect are Pease & Elliman, Inc., v. Gladwin Realty Co., Inc. (216 App. Div. 421); McKnight v. McGuire (117 Misc. Rep. 306) and Starr, Inc., v. Blumenthal (132 Misc. Rep. 222). These cases rest on the proposition that a broker who performs services in submitting an offer of exchange at the request of one party and negotiating between the parties until he has brought them to a complete verbal agreement is entitled to recover as a direct result of the breach of the contract his entire loss of commissions on both sides from the party who withdraws from the transaction without legal cause.

On the other hand, on what appears to be the weightier reasoning, it has been held that no recovery may be had for the commissions which the broker would have earned from the third party if the exchange had gone through. These decisions rest on the following basis: The broker makes no contract with the owner whereby the owner agrees to exchange his property for the broker’s benefit. Consequently there has been no breach of any such contract. The only contract between the broker and the owner is the contract to find a party who will take it in exchange for other property. The only breach of that contract is the failure to pay the broker the commissions earned from the employer. Parties contract with a view of carrying out their contracts, not breaking them. They are liable only for the natural consequences of their default. Double commissions are not the natural or probable consequence of a brokerage exchange contract and are not, generally speaking, within the contemplation of the parties when a simple brokerage contract is made. Willingness that the broker might earn double commissions afterward expressed implies no obligation to pay such commissions. (Mulhall v. Bradley & Currier Co., 50 App. Div. 179; Calkins v. Woolworth Co., 27 Fed. Rep. [2d] 314, 318; Windman v. Bulkowstein, 168 N. Y. Supp. 57; Niesen v. Galewski, 211 App. Div. 858; affd., 240 N. Y. 652; Goff v. Adelson, 229 App. Div. 802; Eichenbaum v. Taxicab, etc., Co., 135 Misc. Rep. 339).

The claim is made in this case that defendant expressly agreed with plaintiff on or about May 23, 1928, to carry out the contract of exchange with Klein so as to enable plaintiff to earn his commissions. The complaint was amended on the trial so to allege in substance. We see nothing in the evidence which takes the case out of the usual contract of employment. But one such contract between plaintiff and defendant was pleaded or proved. The jury might have found that after that was entered into defendant said to plaintiff, which then represented Klein as broker for the sale of other property, that if plaintiff got the deal through for an exchange he was ready to take such property and told him to go out and get that proposition and he would take the property; that there was a chance for the broker to earn double commissions. This was the ordinary talk between broker and customer as to a desirable prospect. Plaintiff came to defendant with an acceptable proposition. It does not indicate that the minds of the parties at any time met on an independent contract that defendant would consummate the exchange so as to permit plaintiff to earn his commissions or that defendant would become hable therefor if the deal fell through by his fault. The conversation was a mere incident of the broker’s employment.

We have, therefore, a case where the defendant had agreed to pay plaintiff commissions on the agreed value of his own property; where he had not agreed, expressly or impliedly, to pay the commissions which the broker might receive from the other party if a deal went through; where the evidence does not disclose that the parties, when they entered into the brokerage contract, had in mind and contracted with reference to such commissions; and where such loss of profits was not the natural, certain or direct consequence of the breach. In such case there can be no liability for damages for the loss of commissions from the third party. (Hadley v. Baxendale, 9 Exch. 341; Devlin v. Mayor, etc., of City of New York, 63 N. Y. 8, 25; Howard v. Stillwell & Bierce Mfg. Co., 139 U. S. 199, 206.) The second cause of action was properly dismissed.

The judgment should be affirmed, without costs.

Cardozo, Ch. J., Crane, Lehman, Kellogg, O’Brien and Httbbs, JJ., concur.

Judgment affirmed.