text:
    Walker Memorial Baptist Church, Inc., Respondent, v. John W. Saunders et al., Appellants.

      Argued January 22, 1941;
    decided May 29, 1941.

      Edward S. Bentley, William R. Conklin and Henry P. Lipscomb for appellants.

      Harvey F. Remington, F. K. Remington and H. F. Remington for Baptist Missionary Convention of the State of New York, amicus curise.

      Melvel W. Snitow and Sydney Snitow for respondent.
   Finch, J.

The question presented by this appeal is whether the minister of a Baptish church has been illegally removed from his pastorate and certain members of the church wrongfully expelled from membership in the church corporation.

The plaintiff is a religious corporation which owns and maintains a Baptist church in Harlem. The defendant, the Rev. John W. Saunders, was duly inducted as minister of that church. The other defendants have been active members and communicants of the church. Prior to May, 1939, the minister of the church, the Rev. John W. Saunders, and some of his devoted followers, including the other defendants in this action, urged that the plaintiff corporation should sell its church building, located at 39-41 East One Hundred and Thirty-second street, New York city, and purchase a larger building. The trustees of the plaintiff religious corporation opposed this proposal and refused to sanction a campaign for funds for a larger church. Without the consent of the trustees, and in defiance of the directions of the trustees, the minister and the other defendants proceeded to collect funds for this purpose. The trustees ordered them to hand over the funds so raised to the trustees. The defendants refused. Thereupon the trustees charged the defendants with misappropriation of moneys and called a meeting for the consideration of those charges. Notice of the proposed meeting was sent to the members of the congregation and was read in regular Sunday church services on two Sundays preceding the meeting as well as being posted on the bulletin board of the church for two weeks prior to the meeting. The place for the meeting, specified in the notice, was the church building. It did not state in what room of the building the meeting would be held.

On the night set for the meeting the minister and almost three hundred communicants of the church met in the large • auditorium. The trustees and the followers of the trustees met in a smaller room called the lecture room which is located in the basement of the church. Each group invited the other group to join in the meeting it was holding. Each group refused the invitation of the other group. The large group which met in the auditorium and of which the minister and his followers were a part held a meeting and voted itself as a special corporate meeting for the purpose of the transaction of the business of the church. Thereupon the moderator called for the presentation of charges against these defendants. No charges being presented, the moderator dismissed the meeting.

The smaller group, which consisted of the trustees and their followers, conducted its own meeting and after presentation of charges of misappropriation and hearing testimony thereon, voted to discharge the minister and to expel the other defendants from membership in the corporation, but not from membership in the church. The court at Special Term found, and the appellants do not dispute here, that this meeting held in the smaller room by the trustees and their followers was the only legal meeting held in accordance with proper notice given by the trustees. The defendants refused to recognize the validity of these corporate resolutions. The plaintiff then brought this action to enjoin the minister and the other defendants from interfering in any way in the affairs of the plaintiff corporation and from entering upon or using for the purpose of religious services the building of the plaintiff. During the pendency of the action a temporary injunction was granted as prayed for in the complaint and the order granting such temporary injunction was affirmed in the Appellate Division. The action was thereafter tried at Special Term and a permanent injunction granted in favor of the plaintiff. The Appellate Division has unanimously affirmed this decision. This appeal is by leave granted by this court.

It should be noted at the outset that there is not presented by this appeal the right of the trustees of the church to demand and receive any funds collected for or on behalf of the Walker Memorial Baptist Church, since the plaintiffs have not included such demand in the complaint.

The sphere of legal activity of a religious corporation in so far as its corporate activities can be separated from its ecclesiastical activities, is governed and limited by the Religious Corporations Law (Cons. Laws, ch. 51), several provisions of which are relevant to the questions here presented. Thus section 5 of article 2 of that law provides that the trustees of every religious corporation shall have the custody and control of all the temporalities and property, real and personal, belonging to the corporation and of the revenues therefrom.” (Italics interpolated.) Even this control by the trustees is limited in that it is to be administered in accordance with the discipline, rules and usages of the corporation and of the ecclesiastical governing body, if any, to which the corporation is subject.” The power of the trustees of an incorporated church is further limited since “ this section does not give to the trustees * * *, any control over the calling, settlement, dismissal or removal of its minister, or the fixing of his salary; or any power to fix or change the times, nature or order of the public or social worship of such church.” The foregoing section defines the powers of the trustees ” of the religious corporation as distinguished from the corporation itself acting through its voting members. The trustees are not themselves the corporation, for the “ members of the association form the * * * legal entity, which is represented by the trustees; * * * that the societies are themselves incorporated; that their members are the corporators, and the trustees the managing officers of the corporation.” (Robertson v. Bullions, 11 N. Y. 243, 248, 250.)

We come now to the question to what extent the powers of the corporation are limited by ecclesiastical requirements. Section 25 of article 2 of the Religious Corporations Law provides that no provision of this chapter authorizes the calling, settlement, dismissal or removal of a minister, or the fixing or changing of his salary.” Instead a meeting for such purpose is to be called and governed only according to the “ practice, discipline, rules and usages ” of the religious denomination or ecclesiastical governing body with which the church is connected. Section 26 of article 2 contains similar provision in regard to worship. These sections are expressly not applicable to Baptist churches. If they applied, then the action taken by the religious corporation in this case would be illegal, for the meeting called by the trustees was concededly not governed in accordance with the practice, discipline, rules and usages ” of the Baptist church. Section 27 of article 2 expressly provides that sections 25 and 26 are not applicable to a “ Baptist church, a Congregational church or to any other religious corporation having a congregational form of government.” For that reason we must look to other provisions of the statute, and especially to the provisions of article 7 governing Baptist churches, to find what are the powers of a religious corporation formed as a Baptist church in regard to the conduct of corporate meetings and the control of such corporate meetings over the induction or removal of a minister.

The plaintiff bases its complaint upon, and alleges that the requisite power to remove the minister by corporate meeting can be found in section 170 of article 8. Article 8, however, applies only to Congregational and Independent churches and has no application to Baptist churches, which are governed by article 7. For the purposes of the provisions contained therein article 7 and article 8 are mutually exclusive. The provisions of article 8 cannot, therefore, be applied to a Baptist church.

The only provision in article 7 which specifically refers to ministers is section 139, which provides that “ The trustees of an incorporated Baptist church shall have no power to settle or remove a minister or to fix his salary or, without the consent of a corporate meeting, to incur debts beyond what is necessary for the administration of the temporal affairs of the church and for the care of the property of the corporation; or to fix or change the time, nature or order of the public or social worship of such church.” (Italics interpolated.) This provision refers to the trustees only and not to the corporation itself. As pointed out before the trustees are merely the managing officers of the corporation. (Robertson v. Bullions, 11 N. Y. 243.)

Section 134 of article 7 provides that the qualified voters at a corporate meeting of an incorporated Baptist church must include the members of such church in good and regular standing by admission into full communion or membership therewith, or [others] who have statedly worshipped with such church and have regularly contributed to the financial support thereof during the year next preceding such meeting; * * *.” This section further provides that the corporation may at a properly noticed corporate meeting restrict the class of voters to members of the church by admission into full communion or membership therewith.”

Thus section 139 and section 134 of article 7, which pertain only to Baptist churches, carry out the general intent of the Religious Corporations Law as evidenced by sections 5, 25 and 26 of article 2, that such law should not change the practice, discipline, rules and usage's ” of the religious denomination or ecclesiastical governing body with which the church corporation is connected.

The court at Special Term finding the Religious Corporations Law silent as to the proper procedure for the removal of a minister of a Baptist church, went to the General Corporation Law (Cons. Laws, ch. 23) and found the provision that a corporation may appoint such officers and agents as its business shall require. (General Corporation Law, § 14, subd. 4.) The court at Special Term then found that a minister was such an officer or agent of the corporation and construing the power to appoint as including the power to remove, reached the conclusion that the corporation, as opposed to the ecclesiastical body of the church, had the power to remove the minister. This construction of the law and the facts is urged by the plaintiff in this court.

An answer to the foregoing contention lies in the fact that there is no evidence in this record to sustain a finding that the minister of a Baptist church is an officer, agent or employee of the religious corporation. The uncontradicted testimony of defendants’ expert witnesses fully expounded the customs, practices and usages of the Baptist faith relating to the calling and dismissal of ministers and to the distinction between the Baptist church as a religious society and as a religious corporation. These . witnesses testified that the Rev. Mr. Saunders was called to the Walker Memorial Baptist Church pursuant to a call issued by a “ church meeting,” i. e., a meeting of the religious society after a recommendation by the board of deacons of the church. This, according to these witnesses, is the usual custom for issuing a call in a Baptist church and the trustees of such church have no voice in this matter, except as members of the religious society. It was further testified that under the customs, practices and usages of the Baptist faith, there is a clear-cut distinction between the spiritual body and the incorporated church. The spiritual body is of ancient origin, recognizing and following the laws and precepts of the New Testament. The spiritual body has two classes of officers, the pastor and the deacons. The pastor is the chief spiritual officer, having direct charge of the spiritual matters of preaching and teaching and the general spiritual oversight of the members of the congregation. The deacons are elected by the spiritual body, and assist the pastor in the discharge of his duties. Formerly the deacons also had charge of the temporalities, but when it was found desirable to form a corporation to hold the temporalities, trustees were elected to handle the finances and to control and manage the temporalities of the church. It was further testified that should the church wish to discharge the minister, the matter must originate in the board of deacons and that a 1 church meeting,’ the only body that can handle such matters,” would have to pass upon such discharge. “ It is not the practice in any Baptist church ” for a corporate meeting to pass upon such charges.

Section 2 of article 1 of the Religious Corporations Law defines the term “ minister ” as including “ a clergyman, pastor, rector, priest, rabbi, or other person having authority from, or in accordance with, the rules and regulations of the governing ecclesiastical body of the denomination or order, if any, to which the church belongs, or otherwise from the church, to preside over and direct the spiritual affairs of the church.” Although it was testified that there is no central governing body in the Baptist denomination, the alliances of Baptist churches being merely for the establishment of publishing houses for the dissemination of religious printed matter and for co-operation in educational and missionary work, the Baptist churches accept Hiscox’s Directory (the New Directory for Baptist Churches by Rev. Edward S. Hiscox) as an explanation and codification of the principles governing the policies and customs and usages of the Baptist churches. Thus in the instant case there was no superior governing ecclesiastical body which had the power to prescribe the methods by which the Walker Memorial Baptist Church could dismiss its minister, but there was a recognized interpretation of the Scriptures codifying the customs and usages of the Baptist church in general. It was testified that the Walker Memorial Church subscribed to these customs.

Since it is undisputed that the Baptist church has rules and regulations for the appointment of ministers, and since a minister is one who has authority to “ preside over and direct the spiritual affairs of the church,” there cannot be any sound basis for the conclusion that the minister of a Baptist church is an officer of the legal entity which is given control only of the temporalities of the church, which conclusion would be exactly contrary to the rules and regulations by which the church considers itself governed. It follows that the minister of a Baptist church, under the rules and regulations of that denomination, is an officer of the religious society of the church and is not an officer of the religious corporation. This distinction between the church as a religious society and the church as a religious corporation has long been recognized and clearly formulated by the previous decisions of this court. (Petty v. Tooker, 21 N. Y. 267; People ex rel. Dilcher v. German United Evangelical St. Stephen’s Church, 53 N. Y. 103; Landers v. Frank Street Methodist Episcopal Church, 114 N. Y. 626; Bristor v. Burr, 120 N. Y. 427; Westminster Presbyterian Church v. Trustees of Presbytery of New York, 211 N. Y. 214; Fiske v. Beatty, 206 App. Div. 349; affd., 238 N. Y. 598.) It follows, therefore, that the plaintiff corporation had no power to discharge the defendant, the Rev. Mr. Saunders, from his position as minister of the Walker Memorial Baptist Church.

The question still remains whether the corporation could expel the other defendants from membership in the corporation. The defendants’ expert witnesses testified and it is not disputed here by the plaintiff that the corporation cannot and has not expelled them from the spiritual body. Relevant to this question, section 134 of article 7 provides that “ at a corporate meeting of an incorporated Baptist church the qualified voters shall be all persons of full age, who are then members of such church in good and regular standing by admission into full communion or membership therewith, or [others] who have statedly worshipped with such church and have regularly contributed to the financial support thereof during the year next preceding such meeting.” Thus by this section all members of the church of full age who have been admitted to church membership by admission into full communion or membership are ipso facto voters of the corporation. Although it was found as a fact by the court at Special Term that on April 10, 1939, this church had passed a resolution requiring that in order for voters to be eligible to vote at corporate meetings it would be necessary for the said voters to pay $1.50 per quarter year, without passing upon the power of the church to so restrict voting powers of the church members, it was not alleged here that any of the defendants had not qualified to vote. Therefore, since all these defendants are members of the spiritual body of the church, it follows that the church corporation had no right to expel them from voting rights in the religious corporation.

The same result, namely, that the church corporation had no right to expel them from voting rights in the religious corporation, follows also from the testimony of the expert witnesses that there are no members of the corporation, merely .voters, and that membership in a Baptist church may be terminated in three ways only, (1) by transfer, namely, by delivery of letter to another Baptist church, (2) by expulsion, when the offending member has violated the discipline of the church and the ecclesiastical body regards him as not fit for membership therein, and (3) by death. Since termination of membership in the religious society by means of the first two of these methods must be by the religious body upon the recommendation of the board of deacons, the church corporation has no power to expel a church member from ecclesiastical membership. As pointed out above, membership in the ecclesiastical body ipso facto allows the church member to vote in the meeting of the religious corporation.

The plaintiff urges upon this appeal that the law of the case was conclusively determined by the order of the Appellate Division affirming the granting of the temporary injunction since that order, it is argued, constitutes an adjudication that the complaint sets forth a good cause of action. A complete answer to this contention is that the granting of a temporary injunction serves only to hold the matter in statu quo until opportunity is afforded to decide upon the merits. The granting or refusal of a temporary injunction does not constitute the law of the case or an adjudication on the merits, and the issues must be tried to the same extent as though no temporary injunction had been applied for. In addition, since the injunction order lay in the discretion of the Special Term arid the Appellate Division, the decision thereon was not appealable to this court (Brown v. Keeney Settlement Cheese Assn., 59 N. Y. 242; Strasser v. Moonelis, 108 N. Y. 611; Schneider v. City of Rochester, 155 N. Y. 619), and the proceeding is not material here.

It follows that the judgments should be reversed and the complaint dismissed, with costs.

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

Judgments reversed, etc.


source: Caselaw Access Project

author: Conway, J.

license: Public Domain

text:
    In the Matter of the Accounting of National City Bank of New York et al., as Executors of H. Hardcastle Pennock, Deceased. Constance L. Pennock et al., Infants, Appellants; Carol H. Pennock et al., Respondents.

      Argued January 15, 1941;
    decided May 29, 1941.

      Alexander S. Andrews, special guardian, for appellants.

      Richard Steel for Carol H. Pennock, respondent.

      David M. Potts and Otis T. Bradley for National City Bank of New York, as executor, respondent.
   Conway, J.

The testator executed a will by which he bequeathed fifty dollars to each of his two children, all his personal and household effects to his wife and the residue of his estate to his trustee in trust “ to hold, manage, invest and reinvest ” it and to pay the net income to his wife for life, then, after division into two parts, to pay the income to each of his two children for life with remainder over to their issue per stirpes and in default of such issue to a relative.

The testator was a life insurance agent who was entitled to commissions on renewal premiums over periods of years, the longest of which could be fifteen, upon policies written by him, in a number of companies. At the time of his death the total of these commissions could have reached the sum of approximately $160,000. There would, of course, be no renewal premium paid, and thus no commission, in the event of the death of a policyholder or the lapse or surrender of his policy.

The fifth paragraph of the will is as follows:

“Fifth. I authorize my executors and trustee to retain as investments for the trusts hereby created any of the securities or property in which my estate may be invested at the time of my death, until in their discretion they shall deem it advisable to dispose of them, hereby relieving them from all responsibility and liability for loss in so doing. Upon any sale of such securities, I direct my executors or trustee to invest the proceeds in such securities as are legal for trust funds. I direct that all stock dividends received by my trustee be held as part of the corpus of the trust estate.”

The testator had set up a living trust with the same trustee and beneficiaries but with the income payable to himself during his life and upon his death to his wife during her life under certain conditions not here material. The trust deed was amended in 1929 by the addition of the following provision: “ After the death of settlor so long as settlor’s said wife shall * * * be entitled to receive the income from the trust fund hereunder, the trustee shall apply to her each year out of the principal of the trust fund so much thereof as with the income applied to her hereunder and with the income and/or principal applied to her under any other trust, whether by agreement or by will wherein the National City Bank of New York or the Farmers Loan & Trust Company or the successor of either of them shall be acting as trustee, will aggregate each year the sum of $15,000. The direction herein contained shall be in addition to any other direction or authority in this agreement contained for the application of principal to settlor’s said wife.”

The questions presented are as to the nature of the assets constituting the rights to the commissions from the various companies and whether there should be apportionment of capital and income among the successive life tenants and remaindermen upon the sale of those assets or their realization.

The learned Surrogate after a review of the authorities reached the conclusion that these choses in action were not wasting but capital assets. This we think was correct.

Wasting property includes such property as leasehold interests; royalties; patent rights; interests in things the substance of which is consumed, such as mines, oil and gas wells, quarries and timber lands; interests in things which are consumed in the using or are worn out by use, such as machinery and farm implements.” (2 Scott on The Law of Trusts, § 239, pp. 1332, 1333.)

Wasting assets generally are such as throw off what would be true income except for the wastage. In such cases there is an apportionment from income to capital for the protection of the remainderman. The rights to the commissions in renewal premiums are not of this nature. They are rights to receive installments of remuneration for work fully performed during the lifetime of ‘the testator, in definite and certain amounts, upon payment of the renewal premiums, which installments, however, may never be received because of the occurrence of events over which neither the successive life tenants nor remaindermen have any control.

Of such a commission it has been said: He had earned his pay, and had received a part of it; to the rest, he then acquired a right, such as it was, but no determination could then be made how much the rest would be, and in no event could he receive it except in annual installments. Although the right had value, it lacked an essential element; no renewal premium might ever be paid, and in that event he would receive nothing more; or renewals might be paid only in part, and then he would be entitled to commission on that part only. The insured might die before a given renewal fell due, or he might allow his policy to lapse, and in either event the right of the agent to future commissions perished. The right, therefore, was contingent; his contracts so provided, for they declared that commission should accrue only as premiums should be paid in cash, and certainly until such payment should be made he had no collectible claim against the society. He had a property right that had value, but contained also an element of risk, and unless he turned it into money it remained contingent. The act taxes money, or its equivalent, or its representative, and a contingent right such as this is not 1 income ’ in the sense used by the act.” (Woods v. Lewellyn, 252 Fed. Rep. 106, 108. See, also, Parker v. Routzahn, 56 Fed. Rep. [2d] 730.)

Upon receipt of all the payments which have been or will be made, the assets will not have wasted butjyill have been realized. These are clearly capital assets which throw off no income. As each renewal premium is paid there is created a debt by the particular insurance company to the estate. The receipts of money by the estate are the payment of those debts. Thus the doctrine of Howe v. Earl of Dartmouth (7 Ves. Jr. 137) and the apportionment from income to capital thereunder is not applicable here. The reason is that there is no income from these choses in action. The payments are of principal.

This conclusion does not dispose of the question of apportionment, however, of those payments between principal and income. Apportionment is of very great importance to the life tenant since it is possible, under the testator’s agreement with the insurance companies, that some of the payments of principal may not fall into possession for nearly fifteen years. The record does not disclose with any exactitude for how long a period the payments will or may continue and, of course, there will be no sums to invest to provide income for the life tenant except as payments are received by the trustee.

Considering for a moment the fifth ” paragraph of the will, quoted supra, there was no permission granted therein to retain the rights to the commissions as investments.” The contracts for the payment of those commissions to the testator were clearly neither securities nor property in which testator’s estate was invested ” at the time of his death. An investment is generally defined as “ the conversion of money or circulating capital into some species of property from which an income or profit is expected to be derived in the ordinary course of trade or business.” (33 C. J. 808.) In this instance, in addition, the meaning of the term is also made manifest from its use in the portion of the will of which quotation has been made, supra.

It thus may not be urged that there can be no apportionment here because there was permissive retention of the assets and that, therefore, a rule for apportionment as to personalty is being declared which differs from that relating to realty as laid down in Lawrence v. Littlefield (215 N. Y. 561, 567-569); Furniss v. Cruikshank (230 N. Y. 495, 500, 501) and Matter of Rowland (273 N. Y. 100, 108, 109).

We are not now concerned with the apportionment allowed below, on the theory of wasting assets, where there was permitted an apportionment at once, from capital to income and an invasion of capital for the benefit of the life tenant over what might be a term of fifteen years, with all the risk of failure of the assets to fall into possession thrown upon the succeeding or secondary life beneficiaries and remaindermen. What we have here are not wasting assets but unproductive and partially unproductive assets. In the case of unproductive assets there is an apportionment from capital to income upon sale or realization in order to protect the life tenant. The authorities from Lawrenc v. Littlefield (215 N. Y. 561) to Matter of Rowland (273 N. Y. 100) have laid down the rules applicable to the apportionment of the proceeds of the sale of unproductive realty and have also pointed out the occasions when the apportionment will be decreed. The same rules have properly been held applicable to unproductive tangible personalty of peculiar and distinctive character. (Matter of Clarke, 166 Misc. Rep. 807.) We see no reason for any distinction between a sale of chattels and realization upon choses in action when of the peculiar and distinctive character of the commissions here.

It is the intention of the testator which controls. The question here is whether under this will creating a trust of unproductive and partially unproductive personalty assets with income payable to successive life beneficiaries with remainder over, with no permission given to the executors or trustee to retain the rights to the commissions on the renewal premiums and yet with no proof of a market for the sale of those rights, we shall say that the testator intended that the moneys which fell into possession on the realization of those rights shall be apportioned between income payments to the successive life beneficiaries and principal payments to the remaindermen? Or, on the contrary, shall we say that the testator intended that the moneys from the rights as realized should be treated as principal with income payable to the life beneficiary or beneficiaries only from the times of their investment, even though the testator knew that some of those moneys might not fall into possession for many years? ¡

The interpretation of a will and the inferred intent of the testator “ must be gathered from the language used, the circumstances and conditions surrounding the execution of the will, as well as the relationship of the testator to the object of his bounty.” (Matter of Rowland, supra, p. 107; Furniss v. Cruikshank, supra.) To these should be added a consideration of the nature of the trust property and its extent in relation to the other assets of the estate.

The desire of the testator that his wife have prompt and substantial income upon his death is evidenced by his change in the living trust made on June 26, 1929, and by the trust established by his will executed on March 3, 1933, some two and one-half years before his death. It must be assumed that he knew all that could be known about his contracts for commissions on renewal premiums, for he was a life insurance agent. It must also be assumed that he knew the extent of his estate. The value of the securities in the living trust at the time of his death was approximately $73,000 which was greater than his net estate passing by his will. An invasion of the capital of the living trust to the extent of $15,000 per year would inevitably soon destroy it entirely if there were no income from the trust created by will except from the investment of the payments as and when received from the insurance companies. It is clear that such was not the testator’s intent. Moreover, the decree appealed from, which is dated December 18, 1939, discloses that there have been paid debts and administration expenses totalling $49,894.61 and it is alleged that there is the sum of $4,000 still to be paid. It is conceded by the respondent widow, individually and as executrix, that the executors liquidated all the other assets of the estate and sold them in order to satisfy estate obligations and that they were insufficient for that purpose. Thus we find that the rights of testator to commissions are not only the sole assets of the estate but that the moneys realized from them must be invaded to satisfy debts and administration expenses. If it may not be said that there shall be apportionment on realization of those rights to commissions, there will shortly be neither living trust nor substantial income from the trust established by will. Finally, the successive life tenants are the widow and the two children, who are equally preferred objects of testator’s bounty. The intention of the testator that there be apportionment on realization of these unproductive and partially unproductive assets is manifest.

In Lawrence v. Littlefield (215 N. Y. 561, supra), Judge Hiscock, later Chief Judge, referred with approval to the case of Wilkinson v. Duncan (23 Beav. [1857] 469) and quoted from it. There the asset consisted of a “ reversion of a considerable sum of money.” In other words, the asset was a chose in action, as here, and not a tangible chattel, as in Matter of Clarke (supra). The quotation referred to is peculiarly applicable and is as follows: “ The trustees delayed to sell the reversion until • it had fallen into possession, because they were of opinion, that by so doing, they would, in the end, produce a larger amount to the estate of the testator. They acted properly in so doing, but they ought not thereby to injure one of the legatees of that trust fmid for the benefit of others, and it is to be presumed that they in no way intended to do so. The tenant for life has received nothing for interest down to the present time; but if the reversion had been sold he would then have received the interest on the amount of the purchase money; and if the period when the reversion fell in could have been foreseen, and the reversion could have been sold at a fair price, it ought, with the accumulated interest upon it, to have realized the full amount of the fund as it stands at present. I am of opinion that the tenant for life is entitled to have paid to him, in respect of interest, out of the capital of the fund now realized, the amount which he would have so received” (p. 572).

Wilkinson v. Duncan (supra) was followed by Yates v. Yates (28 Beav. [1860] 637), also referred to and quoted from by Judge Hiscock (p. 573), and by Beavan v. Beavan (24 Ch. Div. 649n), Matter of Earl of Chesterfield’s Trusts (24 Ch. Div. 643) and Matter of Hollebone (2 Ch. Div. [1919] 93).

In the last-mentioned case the testator joined in the sale of the business of a partnership, of which he was a member, for a purchase price to be paid in ten half-yearly installments, each to be a percentage of the total net commissions which the purchasers should earn during such half-yearly periods from certain clients. In the event that an installment was not paid on its due date, interest was to be added until payment made. He bequeathed his residuary estate to trustees upon trust for conversion, with power to postpone, to pay the income to his wife for life with remainders over. As is evident, the case is very close in its facts to the instant one. The court there said: It comes, therefore, to this, that part of the outstanding personal estate of the testator is represented by the right to receive these installments of purchase money of wholly uncertain amounts and in the meantime producing no income. The widow is not bound to join in exercising the power to postpone the conversion of the asset, but ibis obvious that the amount which could be realized by its immediate conversion is of a very uncertain and speculative character. In these circumstances, it is for the benefit of all parties interested in the corpus of the estate that conversion should be postponed and that the agreement for sale should be worked out, but this result ought not to be allowed to prejudice the tenant for life; * * * ” (pp. 96, 97).

In the instant case there was a valuation placed upon the right of the testator to the commissions from the various companies at the sum of approximately $87,000 as of the date of his death. There was testimony that commission accounts such as these are purchased, although not by insurance companies, but it was not established that there was a market for such sales and no sale was made.

This leads to the conclusion that upon payment of each commission to the trustee there shall be apportionment therefrom of capital and income, for the successive life tenants, in accordance with the formula prescribed in section 241 of the Restatement of the Law of Trusts (Matter of Rowland, 273 N. Y. 100, 110), at the average rate earned upon legal investments from the date of testator’s death to the dates of the various payments.

• We have not overlooked Industrial Trust Co. v. Parks (57 R. I. 363). There, however, as the court pointed out, each of the contending counsel asserts or admits that if his contention is not sustained by this court, the payments should be apportioned between income and principal according to the doctrine of conversion of wasting assets.” A temporary apportionment on that basis was directed but with a recalculation later in a manner indicated by app oving reference to the earlier decision of R. I. Hospital Trust Co. v. Tucker (52 R. I. 277). In that latter case the court said, of non-dividend paying stocks (at p. 280): “ As to the shares not sold, we cannot agree with the contention of the life tenant that he is entitled to receive, at regular intervals until they are sold, interest at 6% on the inven' ory value of said shares. It is clear that such procedure might result in turning over to the Ufe tenant, in addition to proper income, a large amount of the capital, which of course must be retained for the ultimate benefit of the remaindermen, and a very practical objection is that the trustee has no funds from which to pay such interest. The authorities cited do not support the contention.”

That decision is in accord with Furniss v. Cruikshank (230 N. Y. 495), which is cited in the opinion.

Rubenstein v. Rubenstein (221 App. Div. 612, 615) is not in point. There the testator, owner of a twenty-one year lease, assigned it “at an increased rental of $1,200 per annum.” It was pointed out that the $1,200 per annum was not rental but “ the purchase price on the sale of an interest in real estate paid in installments extending over a period of years ” and that the annual payments were principal. The question decided was as to the nature of the asset and no consideration was given to the question of apportionment of the payments between principal and income. Incidentally the Rubenstein case was distinguished and in large measure disapproved in Industrial Trust Co. v. Parks (supra).

The order of the Appellate Division and the decree of the Surrogate’s Court should be reversed and the matter remitted to the Surrogate’s Court for further proceedings in accordance with this opinion, with costs in all courts to all parties appearing separately and filing briefs payable out of the estate.

Finch, Rippey and Lewis, JJ., concur; Lehman, Ch. J., Loughran and Desmond, JJ., dissent from so much of the opinion and decision as finds an intention to apportion.

Ordered accordingly.


author: Lehman, Ch. J.

text:
    Sandford Laundry, Inc., Respondent, v. Louis Simon, as Treasurer of Laundry Workers Joint Board of Greater New York, et al., Appellants.

      Argued February 25, 1941;
    decided May 29, 1941.

      Merwin D. Maier and Jess G. Schiffmann for appellants.

      Richard H. Level and Ray W. Aylesworth for respondent.
   Lehman, Ch. J.

The plaintiff operates a steam laundry-in Westchester .county. In February, 1938, the Inter-Borough Laundry Board of Trade, Inc., together with the plaintiff and other members of the Board of Trade, signed a contract with United Laundry Workers Union Local 300 of the Amalgamated Clothing Workers of America whereby the plaintiff and the other members of the Board of Trade, collectively referred to in the contract as the employer, recognized “ the Union as the exclusive bargaining agent for all of its employees ” and agreed to “ employ none but members in good standing of the Union.” The agreement defined the conditions of employment including wages and hours and, in general, the rights and obligations of employers and employees. By its terms the contract was to continue “ until the 31st day of October, 1939, on which date this agreement and the terms thereof shall be automatically renewed from year to year thereafter unless sixty (60) days prior to the expiration of this Agreement * * * notice in writing * * * is given by either party to the other * * * of an intention to terminate the same.”

Differences and disputes between the parties arose while the contract was in force. The contract provided for the submission of all matters in dispute to arbitration. In proceedings instituted in the Supreme Court, pursuant to the provisions of section 1452 of the Civil Practice Act, an order was made in March, 1939, appointing Max J. Schneider as arbitrator and directing that the arbitration of the disputes proceed before him as provided in the contract. Hearings began on July 6th and were finished on August 11, 1939. On October 27, 1939, the arbitrator signed and published an award, but did not acknowledge it.

The award states in substance that the arbitrator found that the plaintiff as employer had not complied with the provisions of the agreement for a union shop, but had attempted to break down and destroy the union; and the employer was required by the award to reinstate, with one exception, “ all employees who went on strike.” The arbitrator in the award found also that “* * * acts of the employees of Sandford Laundry, Inc. in going on strike without first attempting to arbitrate under the collective agreement between the parties hereto dated the 18th day of February, 1938, was in violation of the terms of said agreement and that said employees refused to return to work even after being advised to do so by the president of their union. That by reason thereof, Sandford Laundry, Inc. has been damaged in the sum of $2,400.00 which sum should be paid to it by Laundry Workers Joint Board of Greater New York.”

After the hearings were closed the plaintiff gave notice to the union that it intended to terminate the contract on October 31,1939. In accordance with its terms the contract thus came to an end four days after the award was published. The provisions of the award requiring the reinstatement of striking employees could, for that reason, have no substantial force or effect. The arbitrator had not been informed before making his award that notice of intention to terminate had been served. He believed that he was making an award partly in favor of each of the disputants; he refused to acknowledge the award when informed that the employer was no longer under any contractual obligation to maintain a union shop and that the provision of the award that the employer should reinstate union members who went on strike was little more than an empty gesture.

The Arbitration Law (L. 1920, ch. 275) was repealed by chapter 341 of the Laws of 1937 and its provisions, so far as relevant to the questions presented upon this appeal, were incorporated in article 84 of the Civil Practice Act by the same statute. To entitle an award to be_enforeed as prescribed in that article the award must be “ acknowledged or proved, and certified, in like manner as a deed to be recorded.” (§ 1460.) Subscription by the arbitrator making an award in writing is not sufficient. No motion to confirm an award which is not so acknowledged or proved and certified can be entertained (§ 1461), and judgment on an award cannot be entered in accordance with the statute until an order has been granted confirming or, in proper case, modifying or correcting an award. (§ 1464.)

The union, claiming that the award is the result of mistake and does not accord with the real intention of the arbitrator, moved to send the proceedings back to the arbitrator for clarification or amendment of the award. The employer made a counter-motion to compel the arbitrator to acknowledge the written award he had subscribed and published. The justice at Special Term denied both motions. The decision was affirmed without opinion by the Appellate Division. ’ (Matter of Sandford Laundry, Inc., v. Simon, 259 App. Div. 995.) No appeal from that decision was taken to this court. Right or wrong, it marked the end of statutory proceedings to enforce the award and eoncededly it is not subject to review upon this appeal.

Article 84 of the Civil Practice Act provides in section 1460 that to entitle an award to be enforced “ as prescribed in this article,” it must be acknowledged, but it also provides in section 1469 that This article does not affect any right of action in affirmance, disaffirmance, or for the modification of a submission or contract, made either as prescribed in this article or otherwise, or upon an instrument collateral thereto, or upon an award made or purporting to be made in pursuance thereof. And, except as otherwise expressly prescribed therein, this article does not affect a submission or contract, made otherwise than as prescribed therein, or any proceedings taken pursuant to such a submission or contract, or any instrument collateral thereto.”

The Civil Practice Act, embodying the provisions of the Arbitration Law, provides a convenient method to enforce an award by motion, but a. party to an arbitration may, if he chooses, elect to pursue the other party by an action for a judgment based upon the award. The provisions of section 1469 are derived from an older statute and this court has held that the intent of the Legislature in enacting such statute was to preserve the right to resort to an action for enforcement of an award made pursuant to a submission or contract though where the arbitral proceedings and the award conform to the statutory requirements, the statute provides a more summary method of enforcement. (Burnside v. Whitney, 21 N. Y. 148.) In this case the plaintiff, defeated in its attempt to enforce the award in statutory proceeding, has now brought this action to obtain a judgment based on the award. A motion for summary judgment, made by the plaintiff, was granted by the court at Special Term and affirmed by the Appellate Division by a divided court.

Doubtless an award made pursuant to a submission or contract “ made otherwise than as prescribed ” in the statute is valid and enforceable in the same manner as if no arbitration statute has been enacted. Doubtless, too, a right of action upon an arbitration award made pursuant to a submission or contract made as prescribed in the statute or otherwise continues to exist though a new statutory method of enforcement of such an award has been created. So the statute provides in unambiguous language and so the courts have held. Where, however, such a cause of action is asserted a plaintiff must show that the award which the plaintiff seeks to enforce by action has in fact been made in accordance with the terms and conditions of the submission or contract of the parties and that the parties, in such submission or contract, agreed expressly or impliedly that an award so made should be enforced in accordance with the statute or otherwise. The courts will enforce through action or, in appropriate cases, by statutory proceedings, agreements for arbitration; they do not make or change such agreements.

In jurisdictions outside the State of New York where there are statutory provisions for the enforcement of awards made as prescribed in the statute, the weight of authority is that “ if an award or the arbitral proceedings in which it was rendered are not sufficient to satisfy the statute so that the award may be enforced by statutory method, it should not be enforced by applying standards other than those prescribed in the statute, although the standards which have been followed would satisfy common law rules.” (Sturges on Commercial Arbitration and Awards, § 5, and cases there cited.) The author points out that enforcement of an invalid statutory award by action, where the parties have agreed only that there should be statutory arbitration, would be, in effect, to make a new and different contract for the parties; the defendant would be deprived of the benefits of the statute which the parties invoked.”

That assumes, however, that the submission or contract of the parties was intended to authorize only arbitral proceedings and an award, which satisfy the statute, so that the parties can obtain the benefits of the statute which they have invoked. Construction of the agreement of the parties must in each case precede determination of the rights of the parties conferred by the agreement. Contracts for arbitration have, in general, been construed as agreements solely for statutory arbitration in jurisdictions where the statute contains no provisions analogous to section 1469 of the Civil Practice Act. A contract for arbitration in this State must be read in the light of that section. The parties must be deemed to intend that an award not enforceable in accordance with the statutory method is enforceable by action where the contract does not provide expressly or by implication that arbitral proceedings must be conducted and the award made as prescribed by the statute so that the parties may obtain the benefits of the statute. (Cf. Darling v. Darling, 16 Wis. 644.)

The contract here provides that any and all decisions, awards, findings or directions of the Impartial Chairman shall be rendered in writing, as well as his oath as prescribed by the Arbitration Law of the State of New York. In amplification of any and all rights which the Impartial Chairman may have pursuant to this Agreement or by operation of law, it is agreed that in the event of any breach of this contract or of any of the terms hereof by any of the parties hereto, or in the event of any threatened breach hereof or any of the terms hereof by the parties hereto, said Impartial Chairman may as his decision, award, finding or direction issue any and all mandatory directions, prohibitions or orders directed to or against any party breaching this contract or threatening to breach the same or any part thereof, and in such event any party in -whose favor such award, direction, prohibition or order shall have been made by the Impartial Chairman may thereupon apply to the Supreme Court of the State of New York for the confirmation of such award, direction, prohibition or order and for the enforcement thereof with the same force and effect and in the same manner and pursuant to the same proceedings and construction thereof as if such award, direction, prohibition or order were made in an arbitration proceeding pursuant to the Arbitration Laws of the State of New York.” In unambiguous language the parties have there indicated that the arbitration must be so conducted that they may obtain the benefit of the statute which they have invoked.

The arbitrator may be guilty of misconduct in refusing to acknowledge the award he made. We do not now consider whether there is any remedy available to a party aggrieved by such refusal. As we have said, the only question before us is whether an award which does not satisfy the statutory requirements may be enforced by action. It cannot be so enforced unless the courts disregard the plain intention of the parties that any award made by the arbitrator shall be enforceable by statutory proceedings.

The statute is intended to provide a method by which controversies may be determined speedily and without the technicalities which at times may be invoked to hinder the administration of justice. That is the benefit which those who invoke the statute expect to obtain. Sometimes the expected benefit must be weighed against possible detriment flowing from arbitration.

Where parties stipulate for the benefit offered by the statute, they may not, against their will, be bound by an award insufficient to carry with it the stipulated benefit. The purpose of the statute and the intention of the parties is carried out when the courts deny force to an award which does not comply with the statutory requirements and with the provisions of the contract that any award shall be enforceable by the statutory proceeding.

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

Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ., concur.

Judgments reversed, etc.


text:
    Robert Thomas, an Infant, by Robert C. Thomas, His Guardian ad Litem, et al., Appellants, v. City of New York, Defendant, and The Board of Education of the City of New York, Respondent.
    Argued April 15, 1941;
    decided May 29, 1941.

      Mitchell May, Benjamin H. Siff and Joshua S. Lev for appellants.

      William C. Chanter, Corporation Counsel (Charles F. Murphy, Paxton Blair and Irving Galt of counsel), for respondent.
   Conway, J.

The infant plaintiff, a boy of fifteen years, suffered the loss of an eye, when a scriber which had been inserted into and clamped in place in a chuck, which was part of a speed lathe, flew from its fastening. The .action was submitted to the jury upon the theory that the defendant Board of Education failed in its duty to the pupils, of whom plaintiff was one, in permitting them to use a broken and defective machine, with notice of its condition. Before the jury retired to deliberate, the trial court reserved decision upon a motion to direct a verdict in favor of the defendant. In his .charge the trial court made it clear to the jury that any verdicts for the plaintiffs must rest upon their finding that the Board of Education itself failed in its duty to be reasonably careful and prudent in furnishing such machines as were reasonably safe.”

The jury rendered verdicts in fáVor of the plaintiffs. The trial court set the verdicts aside and then directed a verdict in favor of the defendant. In so directing a verdict, he said: “ My conclusion upon the whole case is that the evidence is substantially, if not literally, uncontradicted that the chuck which the plaintiff put in evidence is not defective, and that it is in the same condition now as at the time of the accident. Any finding that it is not now the same would rest wholly upon a suspicion, and a suspicion contrary to the testimony of a chain of witnesses who have accounted for the custody of .the chuck from the time of the accident until now. The only finding warranted by the evidence is that the accident was due to the manner in which the plaintiff inserted the seriber in the chuck.” Entirely apart from the fact that the credibility of the teacher in charge of the machine shop at the time of the accident, and who was one of those in the “ chain of witnesses ” referred to by the court, was clearly a question of fact for determination by a jury, the direction of a verdict constituted error of law. (McDonald v. Metropolitan Street Ry. Co., 167 N. Y. 66.) The trial court had correctly left it to the jury to determine the questions whether the lathe was defective and whether the Board of Education had notice thereof, after the infant plaintiff had made out a prima facie case in respect to both of those matters. What the court in effect said, in directing a verdict, was that proof of those facts was overcome by the uncontradicted testimony of the witnesses for the defendant who testified that the condition of the chuck, at the time of the trial, was the same as at the time of the accident. This was tantamount to saying that the testimony of the witnesses for the defendant was credible as a matter of law and that, plaintiffs’ proof to the contrary was incredible as a matter of law.

The verdicts of the jury may not be reinstated. The motion to set aside the verdicts and for a new trial may have been granted upon any of the grounds mentioned in section 549 of the Civil Practice Act and not upon the narrow ground upon which the verdict was directed.

The judgments should be reversed and a new trial granted, with costs to abide the event.

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

Judgments reversed, etc.


author: Desmond, J.

text:
    Charles S. Davison et al., Appellants, v. Parke, Austin & Lipscomb, Inc., et al., Respondents, Impleaded with Others.

      Argued April 17, 1941;
    decided May 29, 1941.

      Frank C. Mebane, Jr., and Charles Stewart Davison for appellants.

      Louis P. Eisner and Harris Berlack for respondents.
   Desmond, J.

On November 14, 1935, the stockholders of Parke, Austin & Lipscomb, Inc., at a special meeting passed a resolution authorizing the corporation to amend its certificate of incorporation, so as to reduce the capital stock, to exchange for each share of preferred stock without par value then outstanding, one and one-half shares of new common stock without par value, and to exchange for each share of common stock without par value then outstanding, one share of new common stock without par value. The resolution was adopted by the votes of the holders of record of more than two-thirds of the outstanding shares of preferred stock and of common stock. The amended certificate was filed on December 2, 1935, pursuant to section thirty-six of the stock corporation law.” The preferred shares outstanding at the time of the adoption of this resolution provided, pursuant to an amended certificate of incorporation filed in 1927, that the holders were entitled to certain preferences and privileges, including cumulative dividends at the rate of two dollars per share per annum out of any surplus or net profits of the corporation, and to the redemption of their stock at a price not exceeding $30 per share plus dividends thereon accrued and/or in arrears, out of a sinking fund into which the corporation had agreed to make semi-annual payments of $12,500 out of earned surplus, such payments to be cumulative. From October 15, 1931, to the date of the 1935 amendment of the certificate of incorporation, there had apparently been no surplus or net profits as no dividends had been declared on the preferred stock and no payments had been made into the sinking fund during that period. The purpose of the 1935 amendment was to eliminate the burden on the common stock imposed by the preferred stock sinking fund and the accumulated preferred stock dividend ” so that money and long term, credit might be procured to strengthen the financial position of the company; and this purpose was made known to all the stockholders in a letter which accompanied the notice of meeting. The notice of meeting was given to the stockholders two weeks before the meeting. The by-laws of the corporation provided for “ a written or printed notice thereof at least two weeks previous to such meeting.” The certificate of incorporation provided that At least thirty (30) days prior to any reorganization of the Corporation, or reclassification of its capital stock, or merger or consolidation of the Corporation with or into any other corporation, or sale, lease, conveyance or transfer of all or substantially all of the assets of the Corporation * * * the Corporation will mail notice thereof to each of the holders of the Preferred Stock.”

Plaintiffs are preferred stockholders of the defendant corporation. Plaintiff Thompson attended the 'above-mentioned meeting and voted against the proposed changes. Plaintiff Davison did not attend the meeting or vote. Neither has exchanged his preferred stock for the new common stock. They have brought this representative action (in which no others have joined) to have the amendment above described declared null and void as to them and for an order directing defendants, the corporation and its directors (1) to pay to plaintiffs the amount of accumulated dividends unpaid on their preferred stock with interest, and (2) to pay into the sinking fund the unpaid accumulated charges and purchase with such funds the preferred stock of plaintiffs at $30 per share, plus accumulated dividends plus interest from the date of a declaration by the corporation of a dividend on the new common stock, December 24, 1936. The action was instituted over a year and a half after the amendment of the certificate of incorporation became effective and six months after the corporation declared a dividend on the new common stock. The directors of the corporation were made individual defendants in the action.

The trial court dismissed the complaint as to the individual defendants at the opening of the case, and as to the other defendants after trial without a jury. The Appellate Division, first department, unanimously affirmed. Permission to appeal was granted by this court.

We have first to consider to what extent the amending power reserved to corporations of this State by section 36 of the Stock Corporation Law (Cons. Laws, ch. 59) may be exercised in deprivation of preferential rights of dissenting stockholders.

Section 36 of the Stock Corporation Law, added by the Laws of 1923, chapter 787, and substantially unchanged to date, permits a stock corporation to effect certain “ Changes in respect to shares, capital stock or capital,” including a change of any of its previously authorized shares without par value, issued or unissued, into a different number of shares of the same class or any other class without par value, and a classification or reclassification of any shares either wdth or without par value, by filing an amended certificate of incorporation showing among other things “ the number and class or classes of shares to be so changed, * * * and the terms upon which such change is to be made.” (Subd. 10.) Section 37 (subd. 3, f c) prescribes the steps to be taken to effectuate a change under section 36 and provides that “ If such certificate alters the preferences of outstanding shares of any class ” an affidavit of the officers of the corporation annexed to the certificate must state that the changes were authorized by “ the votes * * * of the holders of record of two-thirds of the outstanding shares of each class entitled to vote ” thereon, at a stockholders’ meeting held upon notice pursuant to section 45. Where a certificate filed pursuant to section 36 alters the preferential rights of any outstanding shares ” section 38 (subd. 9) gives “ any holder of such shares not voting in favor of such alteration ” the right to have his shares appraised as provided in section 21. The preferential rights that may be altered by filing such an amended certificate are not, however, expressly defined or limited by statute.

Plaintiffs do not challenge the power of the defendant corporation to amend its certificate of incorporation pursuant to section 36 of the Stock Corporation Law so as to deprive preferred stockholders of their preferential rights to annual cumulative dividends in the future and to priority in the distribution of corporate assets upon dissolution, subject, of course, to the right of dissenting preferred stockholders to have their shares appraised pursuant to sections 38 and 21. Nor do they here challenge the power of the defendant corporation to eliminate as to consenting stockholders cumulative dividend arrearages and unpaid sinking fund obligations with the consent of the holders of two-thirds of the outstanding shares of common stock and of preferred stock. They contend, however, that they have a vested right to accrued dividends and in the cumulative sinking fund for the redemption of their shares of preferred stock, and that they may not be deprived of such rights without their consent, at least in the absence of express statutory authority, citing Roberts v. Roberts-Wicks Co. (184 N. Y. 257) and Breslav v. New York & Queens Electric Light & Power Co. (249 App. Div. 181; affd., 273 N. Y. 593), which case cited with approval Yoakam v. Providence Biltmore Hotel Co. (34 Fed. Rep. [2d] 533, 546).

The issue thus presented is today one of great importance. It’is common knowledge that during the past few years many corporations have been unable to pay dividends either upon common stock or preferred stock and that amounts of unpaid cumulative dividends, constituting they do a first charge upon future profits, have a tendency discourage new investment. Balanced against the desire to encourage investment, however, is the sanctity of the rights of contract. The individual preferred stock investor has bargained for certainty in his return, and may not be deprived of his bargain without express statutory authority. Solution of the problem is further complicated by the fact that any device the use of which is desirable in proper cases for the elimination of burdensome preferential rights of preferred stockholders may be used in other cases, without regard to corporate needs and for the sole benefit of common stockholders. No question has been raised here of the worthiness of the motives of the majority of the stockholders in authorizing the amendment to this certificate of incorporation. The question is whether the present statute, which was in effect when the preferred shares held by plaintiffs were issued, permits a corporation, as an incident to an amendment of its certificate of incorporation, to eliminate preferential rights of preferred stockholders to dividends which have accrued, and to deprive them without their consent of their rights in a cumulative sinking fund for the redemption of their shares.

The present statute reserving to corporations of this State the power to amend their certificates of incorporation is not substantially broader than the statute construed in Roberts v. Roberts-Wicks Co. (supra). There the corporation reduced its capital stock and provided for the exchange of all outstanding shares of preferred stock for a smaller number of shares of new stock. Prior to the reduction of the capital stock the corporation was several years in arrears in the payment of cumulative dividends on its preferred stock. After the reduction the accumulated dividends were paid on the basis of the number of shares of new stock held by each preferred stockholder. Plaintiff, a preferred stockholder, sought to recover dividend arrears on the basis of the number of shares she had before the exchange. The court held that while the reduction was authorized by statute (Stock Corporation Law, L. 1892, ch. 688, § 44), “ that statute and the proceedings under it could not affect any vested right, nor impair the force of any corporate obligation ” and that the right of preferred stockholders “ to the arrears of unpaid dividends upon the shares of stock which were retired, or cut off, by the reduction ” was a vested right ” and a corporate obligation. (See, also, Wiedersum v. Atlantic Cement Products, InC., 261 App. Div. 305.)

In Yoakam v. Providence Biltmore Hotel Co. (supra) the court held that an amendment to the corporation’s .charter purporting to, eliminate a sinking fund similar to the one in thecase at bar was invalid under a general reserve statute in the absence of definite statutory authority. (See, also, Breslav v. New York & Queens Electric Light & Power Co., supra.)

Courts in other States, notably Delaware, have held that accrued dividends are corporate obligations and that stockholders have a vested right to them which may not be cut off without their consent by amendments to the corporate charter, at least where the statute does not specifically authorize the elimination of such a preferential right. (Keller v. Wilson & Co., 190 Atl. Rep. 115; Consolidated Film Industries, Inc., ,v. Johnson, 197 Atl. Rep. 489; Lonsdale Securities Corp. v. International Mercantile Marine Co., 101 N. J. Eq. 554; Patterson v. Durham Hosiery Mills, 214 N. C. 806.) But compare McQuillen v. National Cash Register Co. (27 Fed. Supp. 639; affd., 112 Fed. Rep. [2d] 877).

Since the decision in the Roberts case (supra), whenever it has been held that a corporation may not exercise its power to amend its certificate of incorporation so as to eliminate certain preferential rights of outstanding shares, those rights have been termed vested.” In Albrecht, Maguire & Co. v. General Plastics, Inc. (256 App. Div. 134, 138; affd., 280 N. Y. 840), it was held that an amendment under section 36 of the Stock Corporation Law depriving stockholders of their pre-emptive rights “ could not bind a stockholder who opposed its adoption.” In Breslav v. New York & Queens Electric Light & Power Co. (supra, p. 190) the court held that an amendment making non-callable preferred stock callable “ destroys a vested property right.” In the case of Lord v. Equitable Life Assur. Society (194 N. Y. 212,228) this court held that the right of stockholders to vote for directors was a vested right of property ” which could not be taken away from them by amendment of the corporate charter.

On the other hand, there can be no doubt that sections 36, 37 and 38 of the Stock Corporation Law contemplate the alteration of certain preferential rights of stockholders under their ^contracts, subject only to the dissenting stockholder's right of appraisal. (Matter of Silberkraus, 250 N. Y. 242; Matter of Kinney, 279 N. Y. 423.) So it seems that only confusion results from saying that “ vested rights ” are not within the contemplation of the statute. All preferential rights of stockholders are in a sense vested. They are all property rights founded upon contract. The right of priority in the distribution of corporate assets on dissolution is no less vested than the right to be paid dividends for past years out of contingent future profits. The inadequacy of the vested rights ” test is further demonstrated by the fact that new stock may be issued with preferential rights to the assets of the corporation upon dissolution and to dividends superior to the preferential rights of the then outstanding shares (Matter of Dresser, 247 N. Y. 553), even superior to the right of preferred stockholders to dividends in arrears. (Matter of Duer, 270 N. Y. 343.) In these situations the dissenting stockholder is not even entitled to an appraisal of his shares under section 38 and section 21. (Matter of Kinney, supra.) The judicial problem is not whether a particular preferential right is vested or not, but rather what was the legislative intent as to it.

With regard to the preferential rights here in question the intention of the Legislature is manifest in its failure expressly to provide that these rights may be taken away without the consént of each stockholder. An earlier statute which did not clearly specify which preferential rights of preferred stockholders could be altered was held, in Roberts v. Roberts-Wicks Co. (supra) not to cover an amendment which would deprive preferred stockholders of accrued dividends. When the Legislature enacted the present statute, it must have known of the holding in that case. Its failure to provide specifically that corporations issuing shares entitled to cumulative dividends could alter without the consent of each such stockholder the preferential right of preferred stockholders to be paid accrued dividends seems conclusive that no such power was intended to be conferred. The same may also be said of the failure of the Legislature to provide that cumulative sinking funds for the redemption of preferred stock may be eliminated.

The second issue presented upon this appeal is as to the sufficiency of the notice given to plaintiffs of the meeting of the stockholders to consider proposals for amending the certificate of incorporation. Defendants contend, -and the courts below have held, that the change made by the amendment of the certificate of the corporation did not constitute “ reclassification of its^capital stock,” and that, therefore, the thirty days’ notice prescribed by the certificate of incorporation was not required. In support of this contention they point to the wording of the statute under which the change was made, subdivision F (as it then was) of section 36 of the Stock Corporation Law. That subdivision read as follows: “To change all or any of its previously authorized shares without par value, issued or unissued, into a different number of shares of the same class or of any other class or classes without par value.” At that time the next subdivision read: “ G. To classify or reclassify any shares, either with or without par value; * * *_» Defendants say that the requirement in the certificate of incorporation of thirty days’ notice has to do with changes made under subdivision G only, and not to changes made under subdivision F. But the alterations provided for in both subdivisions are “ reclassifications ” and “ changes ” as those words are commonly understood. The language of this certificate of incorporation clearly promised that, when any such substantial modification or alteration should be attempted, stockholders would have thirty days’ prior notice thereof. Defendants concede that in case of a conflict between the provisions of the by-laws and the certificate of incorporation, the provisions of the latter are paramount, but they argue that if the language of the certificate is applicable, it does not require a thirty days’ notice of meeting, but only a notice of corporate action given thirty days before it becomes effective. The language is unambiguous: “ At least thirty (30) days prior to any reorganization of the corporation, or reclassification of its capital stock * * * the corporation will mail notice thereof * * The reclassification or change in the capital stock occurred at the meeting.

A preferred stockholder may expressly or by conduct waive his right to be paid accrued dividends, and to be given a certain notice of meeting, or may by laches surrender his right to equitable relief. Defendants here pleaded the defense of laches and the defense of waiver. The Special Term stated in its opinion that it was unnecessary to consider or pass upon these defenses in view of its conclusion as to the character of the changes effected by the amendment of the certificate of incorporation. Since, we take a contrary view of the character and effect of the changes in the certificate of incorporation, the judgment must be reversed, but the failure of the courts below to pass upon these material defenses requires a new trial.

In the absence of any allegation of fraud or bad faith on the part of the directors of the defendant corporation, the complaint does not state a cause of action against them individually, and was, therefore, properly dismissed as to them.

As to the defendant corporation, the judgments should be reversed and the matter remitted to the Special Term for further proceedings in accordance with this opinion, with costs to appellants to abide the event. As to the individual defendants, the judgment should be affirmed, with costs.

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

Judgment accordingly.


text:
    People ex rel. John Seinfeld, Appellant, against Harris M. Murdock et al., Constituting the Board of Standards and Appeals of the City of New York, Respondents.
    Submitted January 6, 1941;
    decided January 7, 1941.

      William C. Chanler, Corporation Counsel (Paxton Blair of counsel), for motion to dismiss appeal and in opposition to motion for enlargement of time.

      Julius Hahn for motion for enlargement of time and in opposition to motion to dismiss appeal.
   Motion for enlargement of time to file return denied unless appellant files the return and pays ten dollars costs within twenty days, in which event the motion is granted.

Motion to dismiss appeal granted and appeal dismissed, with costs and ten dollars costs of motion, unless conditions for enlargement of time are complied with, in which event the motion is denied.


text:
    William Smith, Appellant, v. City of Albany, Respondent.
    Submitted January 6, 1941;
    decided January 7, 1941.

      James J. McGuiness, Corporation Counsel (Ralph S. Leonard of counsel), for motion.

      Nathan H. Richman opposed.
   Motion granted and appeal dismissed, with costs and ten dollars costs of motion, unless appellant serves and files undertaking on appeal and pays ten dollars costs within ten days, in which event the motion is denied.


text:
    In the Matter of the General Assignment for the Benefit of Creditors of Long Island Sash and Door Corporation. City of New York, Appellant; United States of America, Respondent.
    Submitted January 6, 1941;
    decided January 7, 1941.
   Motion to amend remittitur granted. Return of remittitur requested and when returned it will be amended by adding thereto after the words affirmed, without costs,” the following: “ upon the sole ground that the provisions of section 3466 of the United States Revised Statutes create in the United States of America a priority superior to that enjoyed by the city of New York, and upon no other grounds.” (See 284 N. Y. 713.)


text:
    Town of Fallsburgh, Appellant, v. Louis Silverman et al., Respondents.
    Submitted January 6, 1941;
    decided January 9, 1941.

      Isaac Silberman and John Bright for motion.

      Milton E. Glickman, S. Wallace Kagan and Harry C. Resnick opposed.
   Motion granted and appeal dismissed, without costs, on the ground the order of the Appellate Division from which the appeal is taken is interlocutory. An appeal may be taken directly to this court from the order of the Special Term made and entered on December 7, 1940, but such appeal will bring up for review only the interlocutory order of the Appellate Division.


text:
    In the Matter of the Estate of Rose M. Roeben, Deceased. Johanna S. Schimmel, Appellant; S. William Freedman, Respondent.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Max Bergman and Jacob Meadow for motion to dismiss appeal.

      Daniel Steingart opposed.
   Motion to dismiss appeal denied.


text:
    Eugene L. Bondy et al., Copartners under the Firm Name of Bondy & Schloss, Respondents, v. Millard E. Theodore et al., Appellants, Impleaded with Others.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Millard E. Theodore, in person, for motion.

      Norman Winer opposed.
   Motion dismissed, with ten dollars costs and necessary printing disbursements, on the ground the order is not final.


text:
    Gertrude A. Caldwell, Individually and as Receiver, Appellant, v. Richard T. Caldwell et al., Respondents.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Joseph A. Nickerson for motion to dismiss appeal and in opposition to motion for enlargement of time.

      Albert L. Krull for motion to enlarge time and in opposition to motion to dismiss appeal.
   Motion to dismiss appeal denied.

Motion for enlargement of time for service of appellant’s points granted and time extended ten days from entry of order hereon.


text:
    Ruth De Santes, Respondent, v. Mural Transportation Corporation and Sol Kellerman, Appellants, Impleaded with Another.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Gustave Schwartz for motion.
    No one opposed.
   Motion denied without prejudice to a motion made hereafter that no briefs be accepted.


text:
    Philip Thomas, an Infant, by Harry Thomas, His Guardian ad Litem, et al., Appellants, v. Beck Brothers Land Corporation, Respondent.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Robert G. Peters for motion.
    No one opposed.
   Motion granted.


text:
    Adele Maher, as Executrix of William J. Byrnes, Deceased, Appellant, v. Mary J. Byrnes, Respondent.
    Submitted January 6, 1941;
    decided January 16, 1941.

      James V. Kilroe for motion.
    No one opposed.
   Motion granted and appeal dismissed, with costs and ten dollars costs of motion, unless appellant files and serves undertaldng on appeal and pays ten dollars costs within ten days, in which event the motion is denied.


text:
    In the Matter of Herbert Condon et al., Respondents, against John E. Connelly et al., Individually and as Commissioners of the New York State Insurance Fund et al., Appellants.
    Submitted January 6, 1941;
    decided January 16, 1941.

      John J. Bennett, Jr., Attorney-General (Edward J. Gretchen of counsel), for motion.

      Milton R. Cohen opposed.
   Motion dismissed, with ten dollars costs and necessary printing disbursements, on the ground that the application has not been made within the time fixed by section 591 of the Civil Practice Act.


text:
    Milton G. Hauer, Appellant, v. Philip J. Rudden, as Executor of Florence Rudden, Deceased, Respondent.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Jacob M. Zinaman for motion.

      Henry Allen Mark for respondent.
   Motion granted on payment of ten dollars costs.


text:
    Charles D. Beckwith, Appellant, v. May A. Beckwith, Respondent, Impleaded with Another.
    Submitted January 6, 1941;
    decided January 16, 1941.

      Sol Rubin for motion.

      Daniel J. Dugan opposed.
   Motion dismissed, with ten dollars costs and necessary printing disbursements, on the ground the order is not final.


text:
    Mary Derlicka et al., Respondents, v. Samuel Leo, Appellant, Impleaded with Others. (First Appeal.) Mary Derlicka et al., Appellants, v. Samuel Leo, Respondent, Impleaded with Others. (Second Appeal.)
    Submitted January 6, 1941;
    decided January 16, 1941.
   Motion for reargument denied, with ten dollars costs and necessary printing disbursements. (See 281 N. Y. 266; 284 N. Y. 711.)


text:
    Howard S. Palmer et al., as Trustees of New York, New Haven and Hartford Railroad Company, Appellants, v. Larchmont Manor Company et al., Defendants, and Peter L. Flint et al., Respondents.
    Submitted January 6, 1941;
    decided January 16, 1941.
   Motion for reargument denied, with ten dollars costs and necessary printing disbursements. (See 284 N. Y. 288.)


text:
    Frank Guiliano, Appellant, v. United States Gypsum Company, Respondent. Ernest Capone, Appellant, v. United States Gypsum Company, Respondent. Antonio George, Appellant, v. United States Gypsum Company, Respondent. Antonio Stornelli, Appellant, v. United States Gypsum Company, Respondent.
    Submitted January 6, 1941;
    decided January 16, 1941.

      William L. Clay for motion.

      Everest A. Judd opposed.
   Motion dismissed, with ten dollars costs and necessary printing disbursements, on the ground the order is not final and the motion had not been made within the time fixed by section 591 of the Civil Practice Act.


author: Per Curiam.

text:
    In the Matter of New York State Guernsey Breeders Co-operative, Inc., Appellant, against Holton V. Noyes, as Commissioner of Agriculture and Markets of the State of New York, Respondent. Rochester Co-operative Milk Producers Bargaining Agency, Inc., et al., Respondents.
    Argued January 6, 1941;
    decided January 23, 1941.

      Irving G. Hubbs, Merritt A. Switzer and Henry S. Manley for appellant.

      Robert I. Millonzi and Milo R. Kniffen for Department of Agriculture and Markets of the State of New York, respondent.

      Hampton H. Halsey for Rochester Co-operative Milk Producers Bargaining Agency et al., respondents.
   Per Curiam.

The same problem presented upon the appeal in Matter of Guernsey Breeders Cooperative, Inc., v. Noyes (284 N. Y. 197) is presented upon this appeal and the order should be modified in accordance with the opinion of the court in that case and as so modified affirmed, with costs to the appellant.

Lehman, Ch. J., Loughran, Finch, Ripfey, Lewis, Conway and Desmond, JJ., concur.

Ordered accordingly.


text:
    Ralph F. Darling, Appellant, v. George V. P. Scheu, Respondent.
    Argued January 6, 1941;
    decided January 23, 1941.

      Thurman W. Stoner for appellant.

      Worthy B. Paul for respondent.
   Judgment affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of the Claim of Simon Lovett, Respondent, against Herman Buck, Doing Business as Terrace Place Garage, et al., Appellants. State Industrial Board, Respondent.
    Submitted January 8, 1941;
    decided January 23, 1941.

      Frank L. Ward for appellants.

      John J. Bennett, Jr., Attorney-General (Roy Wiedersum, Joseph A. McLaughlin and Isaac Frank of counsel), for State Industrial Board, respondent.
   Order of Appellate Division and award of State Industrial Board reversed and claim dismissed, with costs in this court and in the Appellate Division against the State Industrial Board on the ground the accident did not arise out of and in the course of the claimant’s employment. No opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Lewis and Desmond, JJ. Dissenting: Rippey and Conway, JJ.


text:
    John D. Schoonmaker, Jr., et al., Individually and as Executors of John D. Schoonmaker, Deceased, Respondents, v. Elizabeth N. Fagan, Appellant.
    Submitted January 9, 1941;
    decided January 23, 1941.

      John J. Scott for appellant.

      Francis J. Ryan, Jr., and Courtland Palmer for respondents.
   Judgment affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Finch, Rippey, Lewis, Conway and Desmond, JJ. Taking no part: Loughran, J.


text:
    Philip F. Campbell, Appellant, v. City of New York, Respondent, Impleaded with Another.
    Argued January 8, 1941;
    decided January 23, 1941.

      John J. Brandon, Emile Z. Berman and Israel Beckhardt for appellant.

      William C. Chanler, Corporation Counsel (Samuel A. Bloom, Paxton Blair and Sidney Shemel of counsel), for respondent.
   Judgment of Appellate Division dismissing the complaint reversed and a new trial granted, with costs to the appellant to abide the event, on the ground that a question of fact was presented in regard both to the defendant’s negligence and the plaintiff’s freedom from contributory negligence. No opinion.

Concur: Lehman, Ch. J., Lohghran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    The People of the State of New York ex rel. The Prosperity Company, Inc., Respondent, against Rolland B. Marvin, as Mayor of the City of Syracuse, et al., Appellants.
    Argued January 6, 1941;
    decided January 23, 1941.

      James C. Tormey, Corporation Counsel (John F. Hmiel of counsel), for appellants.

      Benjamin E. Shove for respondents.
   Appeal dismissed, without costs. The order upon the motion to dismiss was entered incorrectly. No opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Conway and Desmond, JJ. Taking no part: Lewis, J.


text:
    In the Matter of United Autographic Register Company, Appellant, against Joseph D. McGoldrick, as Comptroller of the City of New York, Respondent.
    Argued January 6, 1941;
    decided January 23, 1941.

      Newton K. Fox for appellant.

      William C. Chanler, Corporation Counsel (Sol Charles Levine and Edmund B. Hennefeld of counsel), for respondent.
   Order affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Lotjgkran, Finch, Conway and Desmond, JJ. Dissenting: Rippey and Lewis, JJ.


text:
    In the Matter of the Accounting of James Sarvent, as Trustee under the Will of Garrett Sarvent, Deceased, Appellant. Mabel M. Guilfoyle, Respondent.
    Argued January 7, 1941;
    decided January 23, 1941.

      Theodore G. Weinberger and Benjamin Levison for appellant.

      Clarence A. Baracks for respondent.
   Appeal dismissed, with costs, on the ground that the determination appealed from is not final. No opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of the Claims of Margaret Levy, Respondent, against World-Telegram Corporation et al., Appellants. State Industrial Board, Respondent.
    Submitted January 8, 1941;
    decided January 23, 1941.

      Albert P. Thill and John P. Smith for appellants.

      James Harte Levenson for claimant, respondent.

      John J. Bennett, Jr., Attorney-General (Roy Wiedersum of counsel), for State Industrial Board, respondent.
   Order affirmed, with costs. As matter of law the conclusion of the Appellate Division was correct. No opinion.

Concur: Lehman, Ch. J., Lottghran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    The City of New York, Respondent, v. Coney Island Fire Department, Appellant.
    Argued January 9, 1941;
    decided January 23, 1941.

      C. Elmer Spedick and Arthur L. Reuter for appellant.

      William C. Chanler, Corporation Counsel (Reuben Levy, Julius Isaacs and Lewis Orgel of counsel), for respondent.
   Judgment affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    The People of the State of New York ex rel. Harley Stewart, Appellant, against William Hunt, as Warden of Attica State Prison, Respondent.
    Submitted January 9, 1941;
    decided January 23, 1941.

      Harley Stewart, appellant, in person.

      John J. Bennett, Jr., Attorney-General (James A. Noonan of counsel), for respondent.
   Appeal dismissed on the ground that no substantial constitutional question is involved. No opinion.

Concur: Lehman, Ch. J., Lotjghran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of John E. Davis, Appellant, against Cecil B. Wiener et al., Constituting the Municipal Civil Service Commission of the City of Buffalo, Respondents.
    Argued January 6, 1941;
    decided January 23, 1941.

      Worthy B. Paul, M. Edwin Merwin and Walter S. Merwin for appellant.

      David Diamond, Corporation Counsel (Andrew P. Ronan of counsel), for respondents.
   Order affirmed, without costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of the Claim of Anna Chervinski, Respondent, against Lehigh Valley Railroad Company, Appellant. State Industrial Board, Respondent.
    Argued January 8, 1941;
    decided January 23, 1941.

      William M. Fay and Vincent P. Sennett for appellant.

      John J. Bennett, Jr., Attorney-General (Roy Wiedersum of counsel), for State Industrial Board, respondent.
   Order affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of the Probate of the Will of Laura Guidi, Deceased. Margaret T. Mountain et al., Appellants; Alexander F. Whelan, Respondent.
    Submitted January 13, 1941;
    decided January 23, 1941.
   Motion for reargument denied, with ten dollars costs and necessary printing disbursements. (See 284 N. Y. 680.)


text:
    William A. Brady, Appellant, v. Blackett-Sample-Hummert, Inc., et al., Respondents, Impleaded with Others.
    Submitted January 13, 1941;
    decided January 23, 1941.
   Motion for reargument and to amend remittitur denied, without costs.

On the appeal we decided only that, even assuming .that the plaintiff is a part owner in the play or has an equitable title to the copyright and that the defendants had notice of his rights, no cause of action arising from breach of duty of, or abuse of, a fiduciary relation, cognizable by the courts of this State, in accordance with the principles formulated in Underhill v. Schenk (238 N. Y. 7), has been established against these defendants who acted under license from the record owner of the copyright. (See 284 N. Y. 635.)


text:
    In the Matter of Philip Frankle, Appellant, against Board of Education of the City of New York et al., Respondents.
    Argued January 10, 1941;
    decided January 24, 1941.

      Max H. Frankle and George Rifkin for appellant.

      William C. Chanler, Corporation Counsel (Nicholas Bucci and Paxton Blair of counsel), for respondents.
   Order affirmed, without costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    In the Matter of Barbara M. Stehle, Appellant, against Joseph D. McGoldrick, as Comptroller of the City of New York, et al., Respondents.
    Argued January 10, 1941;
    decided January 24, 1941.

      Benedict S. Rosenfeld and Murray Winter for appellant.

      William C. Chanler, Corporation Counsel (John D. J. Moore, Jr., Paxton Blair and Denis B. Sullivan of counsel), for Joseph D. McGoldrick, as Comptroller of the City of New. York, et al., respondents.

      John J. Bennett, Jr., Attorney-General (Patrick H. Clune and Bernard L. Alderman of counsel), for State Civil Service Commission et al., respondents.

      Francis T. Sullivan for Bernard M. Patten, respondent.
   Order affirmed, without costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    Adelaide Joseph, Appellant, v. Horn & Hardart Company, Respondent.
    Submitted January 10, 1941;
    decided January 24, 1941.

      Daniel J. Riesner and Julian Jawitz for appellant.

      H. II. Brown and E. C. Sherwood for respondent.
   Judgment of the Appellate Division reversed and that of the Trial Term affirmed, with costs in this court and in the Appellate Division, on the ground that a question of fact as to defendant’s negligence was presented. No opinion.

Concur: Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ. Dissenting: Lehman, Ch. J.


text:
    Lillian Williamson, Appellant, v. Michael J. Delehanty, Doing Business under the Trade Name of The Delehanty Institute of Civil Service, Respondent.
    Argued January 15, 1941;
    decided January 24, 1941.

      William A. Smith for appellant.

      John F. Bowden and Hobart R. Marvin for respondent.
   Appeal may be withdrawn on payment of ten dollars costs and disbursements.


text:
    James G. Graves, Appellant, v. Northern N. Y. Publishing Co., Inc., Respondent.
    Submitted January 20, 1941;
    decided January 24, 1941.

      Edmund Fits Gerald for motion.
    No one opposed.
   Motion granted and appeal dismissed, with costs and ten dollars costs of motion, unless the appellant files and serves undertaking on appeal and pays ten dollars costs within ten days, in which event the motion is denied.


text:
    The People of the State of New York, Respondent, v. James Cahill, Appellant.
    Submitted January 20, 1941;
    decided January 24, 1941.
   Motion for reargument denied. (See 266 N. Y. 546.)


text:
    The People of the State of New York, Respondent, v. Jack Schneider, Appellant.
    Submitted January 20, 1941;
    decided January 24, 1941.
   Motion to amend remittitur granted. Return of remittitur requested and when returned, it will be amended by adding after the words Judgment affirmed the following: this Court having overruled the contention of the appellant that his trial and conviction were in violation of the due process clause and the equal protection of the law clause of the Fourteenth Amendment to the Constitution of the United States, and having refused to pass upon the effect of any parts of the charge to which no exceptions were taken.” (See 284 N. Y. 781.)


text:
    H. V. Noyes, as Commissioner of Agriculture and Markets of the State of New York, Respondent, v. Arthur E. Landel, Doing Business as Williamsville Dairy, et al., Appellants. H. V. Noyes, as Commissioner of Agriculture and Markets of the State of New York, Respondent, v. Sterling Amherst Farms Dairy, Inc., et al., Appellants.
    Submitted January 20, 1941;
    decided January 24, 1941.
   Motion for reargument and a stay granted. Case will be put down for argument during the first week of the next session. (See 284 N. Y. 563; 285 N. Y. 749.)


text:
    The People of the State of New York, Respondent, v. The Jarka Corporation, Appellant. The People of the State of New York, Respondent, v. Samuel Kennedy, Appellant.
    Argued January 13, 1941;
    decided February 27, 1941.

      Paul A. Crouch for appellants.

      Orison S. Marden for The Maritime Association of the Port of New York, amicus curiæ

      William O’Dwyer, District Attorney (Edward H. Levine of counsel), for respondent.
   Judgments reversed and informations dismissed on the ground that the instrumentality is a tractor crane within the meaning of the statute. No opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    Mae LaRue, Respondent, v. Mahlon Tiernan, Defendant, and Francis Borrman et al., Appellants. Mahlon Tiernan, Respondent, v. Francis Borrman et al., Appellants.
    Argued January 14, 1941;
    decided February 27, 1941.

      Ellis J. Staley for appellants.

      J. Edmund Kelly and Charles A. Murphy for Mae LaRue, respondent.

      Andrew J. Hanmer and Seward E. Hanmer for Mahlon Tiernan, respondent.
   Judgments affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    Phœnix Manufacturing Co., Inc., Respondent, v. S. Blechman & Sons, Inc., Appellant.
    Argued January 16, 1941;
    decided February 27, 1941.

      Wolfango E. Cribari and George W. Scapolito for appellant.

      Isidor E. Schlesinger, Leon Singer, Ludwig Teller and Henry J. Krinsky for respondent.
   Judgment affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    Blanche F. Van Ness, as Administratrix of the Estate of William C. Van Ness, Deceased, Appellant, v. Edward Jackson et al., Defendants, and Bedford Chevrolet Sales Corporation, Respondent.
    Argued January 16, 1941;
    decided February 27, 1941.

      Samuel Binder for appellant.

      Edward M. Fuller and Daniel Mungall for respondent.
   Judgments reversed and a new trial granted, with costs to the appellant to abide the event. There is in our opinion substantial evidence from which the jury could reasonably infer that the contract of conditional sale filed on April 26, 1937, was not intended by the parties to constitute an actual transfer of a conditional title. No opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis, Conway and Desmond, JJ.


text:
    Olga Vallone, Appellant, v. Bronx Boro Holding Corporation, Respondent.
    Submitted January 20, 1941;
    decided February 27, 1941.

      Gilbert M. Levy and Charles A. Galotta for appellant.

      Alexander E. Rosenthal and Irving Segal for respondent.
   Judgment affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughran, Finch, Rippey, Lewis and Desmond, JJ. Taking no part: Conway, J.


text:
    In the Matter of Michael Donohue, Appellant, against Irving V. A. Huie, as Commissioner of Public Works of the City of New York, et al., Respondents.
    Argued January 21, 1941;
    decided February 27, 1941.

      Irving H. Saypol and Leo Kotler for appellant.

      William C. Chanter, Corporation Counsel (Stanley Buchsbaum, Robert H. Schaffer and George G. Gallantz of counsel), for Irving V. A. Huie, as Commissioner of Public Works of the City of New York, et al., respondents.

      James B. M. McNally and Samuel Rudykoff for Eugene D. Grun, respondent.
   Order affirmed, with costs; no opinion.

Concur: Lehman, Ch. J., Loughban, Finch, Rippey, Lewis, Conway and Desmond, JJ.