text:
    Charles E. Shuster, Respondent, v. National Surety Company, Appellant.
    (Argued February 17, 1931;
    decided April 7, 1931.)

      Sidney J. Loeb and Leon M. Prince for appellant.
    The policy warranted that two watchmen would make hourly rounds and record same on a watchman’s clock. That warranty plaintiff repeatedly breached. Those breaches were fatal to plaintiff’s recovery, whether contributing to the loss or not, and whether the warranty was material or not. (Weinberg & Holman, Inc., v. P. W. Ins. Co., 254 N. Y. 387; Marcus v. U. S. Casualty Co., 249 N. Y. 21; Norwich Union Indemnity Co. v. Kobacker, 31 Fed. Rep. [2d] 411; Ripley v. Ætna Ins. Co., 30 N. Y. 136; O’Neil v. Buffalo Fire Ins. Co., 3 N. Y. 122; Mead v. Northwestern Ins. Co., 7 N. Y. 530; King v. Tioga Co. P. F. R. Assn., 35 App. Div. 58; Flower v. Ins. Co., 6 Cow. 673.) The policy was further breached in that on Saturday afternoons and all day on Sundays there was only one watchman and the clock was not punched at all. (Rosenthal v. Am. Bonding Co., 207 N. Y. 162; Mead v. Northwestern Ins. Co., 7 N. Y. 530; Jennings v. Chenango Mut. Ins. Co., 2 Den. 75; Cogswell v. Chubb, 1 App. Div. 93; 157 N. Y. 709; Ripley v. Ætna Ins. Co., 30 N. Y. 136; Cary v. Home Ins. Co., 199 App. Div. 122; First Nat. Bank v. Ins. Co., 50 N. Y. 45; Feinstein v. Massachusetts Bonding & Ins. Co., 184 App. Div. 233; 230 N. Y. 621.) The warranty that two watchmen would be on duty within the premises at all times when the place was not regularly open for business, was violated in that there were not two watchmen when the place was closed at nights and on Saturday afternoons and on Sundays. (Gifford v. Patterson, 222 N. Y. 4.)

      Harold R. Medina, William F. McNulty and Alfred B. Nathan for respondent.
    The assured did employ two watchmen, each of whom was on duty not only at the time of the burglary but at all other times when the premises were not regularly open for business. (Smith v. Northwestern F. & M. Ins. Co., 246 N. Y. 349; Hovey v. Ins. Co., 2 Duer, 554; Au Sable Lumber Co. v. Detroit

      Manufacturers Mut. F. Ins. Co., 89 Mich. 407; Theriault v. California Ins. Co., 27 Ida. 476.) A fair and reasonable interpretation of the policy did not require each of the two watchmen employed by the assured to make hourly rounds together and each to punch the same clock. (Gerka v. Fidelity & Casualty Co., 251 N. Y. 51; Bushey & Sons v. American Ins. Co., 237 N. Y. 24; Silverstein v. Commercial Casualty Ins. Co., 237 N. Y. 391; Paskusz v. Philadelphia Casualty Co., 213 N. Y. 22; Michael v. Prussian Nat. Ins. Co., 171 N. Y. 25; Janneck v. Metropolitan Life Ins. Co., 162 N. Y. 574; Zivitz v. Maryland Casualty Co., 192 App. Div. 83; Finucane v. Standard Accident Ins. Co., 184 App. Div. 280; Bird v. St. Paul Fire & Marine Ins. Co., 224 N. Y. 47; Miller v. Phoenix Mutual Life Ins. Co., 107 N. Y. 292; Higgins v. Phoenix Mutual Life Ins. Co., 74 N. Y. 6; McCulloch v. Norwood, 58 N. Y. 562; Dilleber v. Home Life Ins. Co., 69 N. Y. 256; Linzee v. Frankfort General Ins. Co., 162 App. Div. 282; Parker v. Otsego County Fire Ins. Co., 47 App. Div. 204.)
   Kellogg, J.

On the morning of May 12, 1924, at about two o’clock, the plant of Shuster, Kloorfain & Co., Inc., a corporation which conducted a fur-dressing business, was forcibly entered by burglars who removed therefrom valuable furs which had been intrusted to the corporation by its customers. In June, 1923, the corporation had taken out a policy of insurance, issued by the defendant, insuring the corporation for twelve months against a loss of merchandise, owned by it or held in. trust for customers, through a burglary of the plant. Subsequently to May 12, 1924, Shuster, Kloorfain & Co., Inc., assigned its cause of action against the defendant to this plaintiff, who thereupon instituted this action upon the policy to recover damages for the loss sustained.

The policy contained this clause: “ The following statements, numbered 1-12 inclusive, are hereby made a part of the Policy and are warranted by the assured to be true.” There followed, among others, two statements numbered 8 and 9, which are pertinent to the issue. Statement 8 reads: “A private watchman employed exclusively by the assured will be on duty within the premises at all times when the premises are not regularly open for business, while this Policy is in force.” At the foot of this statement there appeared a typewritten clause of which the assured was the author, reading “ yes — two watchmen.” Statement 9 reads as follows: “ The private watchman described in Item 8 will make hourly rounds and record same on the watchman’s clock, or will signal an outside central station at least hourly * * At the foot of this statement the assured wrote in typewriting, “ yes, both watchmen on watchman’s clock.”

The proof is conclusive that throughout the term of the policy, prior to the burglary, two watchmen attended at the plant each night from five p. m. to seven-thirty a. m., when the premises ” were not regularly open for business.” The proof is equally clear that both watchmen did not make hourly rounds; that both did not hourly punch the clock. Indeed, plaintiff’s counsel says in his brief, “ Each night the clock was taken around hourly, sometimes by the two watchmen who went together, but more often by one or the other who went alone, to the various key stations situated in the different parts of the building or factory and punched.”

In effect the insurer had asked the assured (1) whether a private watchman ” would at all times be on duty when the premises were not regularly open for business, and (2) whether such a private watchman ” would make hourly rounds and record them on a watchman’s clock. To each of these questions the assured answered yes.” In so doing it made the only responses called for, furnished the only promises demanded, and integrated the only statements warranted to be true. That it added to its first answer two watchmen,” and to its second both watchmen on watchman’s clock ” is immaterial. These statements were irresponsive and gratuitous assertions not called for by the insurer. They constituted no part of the statements warranted and, as unrequested promises, no part of the contract made. We think, therefore, that there was no warranty that two watchmen would make hourly rounds within the premises and record the same. This view finds support in Norwich Union Indemnity Co. v. Kobacker & Sons Co. (31 Fed. Rep. [2d] 411) and Buell v. Connecticut Mutual Life Ins. Co. (4 Fed. Cas. 590).

As we have already shown, statement 8 provides that a watchman will be on duty at all times when the premises are not regularly open for business; ” statement 9 that the watchman will “ make hourly rounds and record same on watchman’s clock.” No watchman made or recorded rounds on Saturday afternoons or on Sundays during the day time. A watchman named Schmidt came on duty Saturdays at twelve noon; locked up the building when the workmen left; and remained until the night watchmen arrived at five o’clock. On Sundays he attended at the building from eight A. m. to five p. m., but made no rounds and never punched the clock, either on a Saturday or a Sunday. Ordinarily the assured employed between fifty and sixty workmen. On Saturday afternoons and Sundays these men were not present at the plant. True, at these times three officers of the assured and a foreman were present from twelve to five on Saturdays and from eight to five on Sundays and performed manual labor in dressing and storing away furs. However, this hardly presents the picture of a factory then regularly open for business.” Contrast the condition of the building on a week day with its condition on a Sunday or Saturday afternoon; on the one occasion teeming with laborers busily at work; on the other, save for the presence of four officers, empty and idle. It would seem that the insurer, as well as the assured, had this contrast in mind when the policy was drawn by the former and accepted by the latter. The presence of fifty laborers on a week day would safeguard against burglary sufficiently well without the attendance of a watchman; the presence on Sundays and Saturday afternoons of not more than four officers might well call for the attendance of a watchman. This was certainly the view of the assured, for upon the occasions when the full labor force was in attendance no day watchman was provided, whereas on a Saturday and a Sunday, when the regular force was absent, such a watchman was furnished. Clearly, also, it was the thought of the insurer that no watchman was required during the hours when the labor gang was regularly employed; that he was needed on Saturdays and Sundays when that force was absent. It was for this reason, we think, that the insurer made provision that a watchman must be on duty, make hourly rounds and record the same, “at all times when the premises are not regularly open for business.” We think, therefore, that the assured breached its warranty in not providing a watchman to make hourly rounds on Sundays and Saturday afternoons.

Even conceding, for the sake of the argument, that the building on Sundays and Saturday afternoons, though not open for regular business, was “ regularly open for business,” the assured meets another obstacle to recovery. The last records of rounds, punched by a watchman on Sunday mornings, were made at six o’clock. No rounds were made after six o’clock; no record of a round at seven or eight was made. Yet, concededly, none of the' officers arrived at the plant on Sundays earlier than eight o’clock. Thus invariably, every Sunday morning, two hours elapsed without the making or the recording of a round, although, concededly, during those two hours the premises were not “ open for business.” It thus appears that the warranty of the assured that hourly rounds would be made and recorded, when the plant was idle, was broken. Moreover, the omission was not inadvertent, casual or occasional; it was intentional; it consistently occurred at regular intervals. It is not possible to hold that the assured did not thereby break its warranty and sacrifice its policy of insurance.

The judgment of the Appellate Division should be reversed and that of the Trial Term, dismissing the complaint, affirmed, with costs in the Appellate Division and in this court.

Cardozo, Ch. J., Crane, Lehman and O’Brien, JJ., concur; Pound and Hubbs, JJ., not sitting.

Judgment accordingly.


source: Caselaw Access Project

author: Per Curiam.

license: Public Domain

text:
    In the Matter of The City of New York, Appellant and Respondent, Relative to Acquiring Title to Real Property Necessary for the Establishment of a Public Beach in the Borough of Brooklyn. Charles L. Feltman et al., Respondents and Appellants.
    (Argued March 23, 1931;
    decided April 7, 1931.)

      Arthur J. W. Hilly, Corporation Counsel (Patrick S. MacDwyer of counsel), for City of New York, appellant and respondent.
    The main ocean never extended above low-water mark on the shore of the open sea coast and the express fixation of the main ocean as the external or open sea boundary of the territory granted to the town of Gravesend, carried the title of the town to the low-water mark of the ocean. (People ex rel. Morris v. Supervisors, 73 N. Y. 393; Baker v. Hoag, 3 Barb. 203; United States v. Grush, 26 Fed. Cases, 48; Constable’s Case, 5 Coke, 106a; Embleton v. Brown, 3 El. & El. 234; Reg. v. Musson, 8 E. & B. 900; Queen v. Keyn, L. R. 2 Exch. 63; De Lovio v. Boit, 7 Fed. Cases, 418; United States v. Newark Meadows Imp. Co., 173 Fed. Rep. 426; Trustees of Brookhaven v. Strong, 60 N. Y. 56; Robins v. Ackerly, 91 N. Y. 98; East Hampton v. Kirk, 6 Hun, 257; 68 N. Y. 459.) The letters-patent under which title is claimed to the lands under water were insufficient to convey title to the claimants. (People v. Schermerhorn, 19 Barb. 540; People v. Livingston, 8 Barb. 253; Bardes v. Herman, 144 App. Div. 772; Mayor v. Hart, 95 N. Y. 443.)

      Henry A. Uterhart and Joseph Gazzam for Charles L. Feltman et al., respondents and appellants.
    The colonial patent did not grant title to the foreshore to the town of Gravesend. (Town of Southampton v. Mecox Bay Oyster Co., 116 N. Y. 1; Somerville v. City of New York, 78 Misc. Rep. 203; People v. Steeplechase Park Co., 82 Misc. Rep. 247; Sage v. Mayor, 154 N. Y. 61; Matter of Mayor of New York, 182 N. Y. 361; Tiffany v. Town of Oyster Bay, 209 N. Y. 1; Rockaway Park Imp. Co. v. City of New York, 140 App. Div. 160; Furman v. Mayor, 5 Sandf. 16; Langdon v. Mayor, 93 N. Y. 134.) The claimants’ title to parcel 35 was not lost by submergence. (People v. Steeplechase Park Co., 218 N. Y. 459.)
   Per Curiam.

We agree with the conclusion of the Appellate Division as to parcel 84-A. The southerly boundary of the Colonial grants to the town of Gravesend was the high-water mark of the ocean. On February 2, 1898, the Feltmans owned the upland above the high-water mark of that date and by a grant from the State owned the land under water from that high-water mark south to the southerly limits of the grant (parcel 35). Upon the rehearing the Special Term must award compensation for the value not only of parcel 84-A but also of parcel 35, if any.

The order of the Appellate Division should be modified in accordance with this memorandum, and as thus modified affirmed, with costs to the owners, and the questions certified answered as follows: Question No. 1 in the negative; Questions Nos. 2 and 3 in the affirmative.

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

Ordered accordingly.


text:
    The People of the State of New York, Respondent, v. Antonino Montforte and Michael McCloskey, Appellants.
    (Argued March 30, 1931;
    decided April 14, 1931.)

      Joseph M. Proskauer, J. Alvin Van Bergh and Solomon PL. Lifschitz for Antonino Montforte, appellant.
    Prejudicial error was committed by the court in permitting the District Attorney to examine the witness Tantillo as to his refusal to sign a waiver of immunity when called before the grand jury, in permitting the District Attorney to comment and draw unfavorable inferences to the jury therefrom and in refusing to charge in such a way as to remove the prejudicial effect of the District Attorney’s comments. (Penal Law, § 2446; People ex rel. Taylor v. Forbes, 143 N. Y. 219; People ex rel. Lewisohn v. O’Brien, 176 N. Y. 253; State v. Bailey, 54 Iowa, 414; Code Crim. Proc. § 393; People v. Minkowitz, 220 N. Y. 399; People v. Watson, 216 N. Y. 565; Philin v. Kenderdine, 20 Penn. St. 354; Feldgus v. Friedman, 269 Penn. St. 60; State v. Weber, 272 Mo. 475; Beach v. United States, 46 Fed. Rep. 754; Powers v. State, 75 Neb. 226; State v. Nelson, 91 Vt. 168.)

      Frank Oliver and Samuel Gottlieb for Michael McCloskey, appellant.
    Prejudicial error was committed in permitting the District Attorney to interrogate defendant McCloskey and the witness Tantillo as to whether they had refused to sign waivers of immunity when called before the grand jury, in a manner and for the purpose of indicating that unfavorable inferences must be drawn therefrom. The trial court, upon request, charged the jury that these individuals had a legal right to refuse to sign such waiver, but erroneously declined to instruct the jury that no unfavorable inferences were to be drawn therefrom, and that it did not affect their credibility. (New York Const, art. 1, § 6; Code Crim. Proc. § 10; Penal Law, § 584; People ex rel. Taylor v. Forbes, 143 N. Y. 219; People ex rel. Lewisohn v. O’Brien, 176 N. Y. 253; People v. Riley, 129 Misc. Rep. 373; People v. Burleson, 119 Misc. Rep. 107; People v. Gillette, 126 App. Div. 665; People v. Lewis, 14 Misc. Rep. 264; State v. Bailey, 54 Iowa, 414; Lloyd v. Passingham, 16 Ves. Jr. 59; Bunckley v. State, 77 Miss. 540; Pennsylvania R. R. Co. v. Durkee, 147 Fed. Rep. 99; Matter of Levy, 255 N. Y. 223; Matter of Schneidkraut, 231 App. Div. 109.)

      Charles B. McLaughlin, District Attorney (Sol Boneparth, Samuel J. Foley and Herman J. Fliederblum of counsel) for respondent.
    With respect to the refusal to waive immunity on the part of the witness Tan tilla and defendant McCloskey, the court committed no error in its rulings on the testimony, on the summation of the District Attorney, and in its refusal to charge. (People v. Chacon, 102 N. Y. 669; People v. Kennedy, 164 N. Y. 449; Matter of Findlay, 253 N. Y. 1; Flora v. Carbean, 38 N. Y. 111; Millman v. Tucker, Peake Add. Cas. 222; Lloyd v. Passingham, 16 Ves. Jr. 59; People v. Connolly, 233 N. Y. 330; People v. Johnson, 228 N. Y. 332; People v. Trybus, 219 N. Y. 18; Brown v. Walker, 161 U. S. 591; People v. Milks, 70 App. Div. 438; Commonwealth v. Smith, 40 N. E. Rep. 189; Commonwealth v. Goldstein, 62 N. E. Rep. 328.)
   Per Curiam.

A witness called by the defendant McCloskey was asked by the district attorney upon cross-examination if he had refused to sign a waiver of immunity when called before the grand jury. The attorney for the defendant McCloskey did not object to the question, but stated, I want him to answer.” The attorney for the defendant Montforte objected to a similar question asked the same witness. The objection was overruled and an exception taken by the attorney for Montforte. The learned trial justice refused to charge that the jury may draw no unfavorable inference from the fact and that the refusal in no way affected his credibility.” To the refusal to charge as requested the attorney for Montforte duly excepted. There was, therefore, no objection taken by the defendant McCloskey either to the receipt of the evidence or the refusal to charge as requested. The attorney for the defendant Montforte took exceptions which raised the question. We are satisfied, however, that the error in the ruling, if any, was so trifling in its effect as to the only defendant who excepted that it could not have affected the finding of the jury and must be disregarded under section 542 of the Code of Criminal Procedure. We have examined the other questions raised by the counsel for defendants and do not find any error which requires the reversal of the judgment of conviction.

The judgment of conviction should be affirmed.

Cardozo, Ch. J., Pound, Crane, Lehman and Hubbs, JJ., concur; Kellogg and O’Brien, JJ., dissent and vote for reversal as to the defendant McCloskey on the ground that his guilt is not established beyond a reasonable doubt.

Judgment affirmed.


text:
    New York Investors, Inc., Appellant, v. Manhattan Beach Bathing Parks Corporation et al., Respondents.

      (Argued March 30, 1931;
    decided April 14, 1931.)

      William N. Dykman, Jackson A. Dykman, Sigourney B. Olney and Jules Haberman for appellant.
    The title company notified the defendants that pursuant to the contract it approved and would insure the title subject to the incumbrances and exact exceptions set forth in the contract of sale. (Holman v. Patten, 227 N. Y. 22.) The title company approved the title and was willing to insure it. (Bailen v. Potter, 251 N. Y. 224; Day v. Hunt, 112 N. Y. 191; Schmidt v. Reed, 132 N. Y. 108; Hun v. Bourdon, 57 App. Div. 351; Myers v. DeMier, 52 N. Y. 647; Schiffer v. Dietz, 83 N. Y. 300.)-

      Clarence J. Shearn and William Harvey Smith for respondents.
    The contract requires the vendor to convey a title that is marketable, and one that the title company will approve as marketable and will insure as such, subject only to stipulated incumbrances. (Sattler v. Hallock, 169 N. Y. 291; Wallach v. Riverside Bank, 206 N. Y. 434; Vought v. Williams, 120 N. Y. 253; Mutchnick v. Davis, 130 App. Div. 417; Holman v. Patten, 227 N. Y. 22.) The title company refused to approve the title as marketable and except in a qualified way to insure against defects other than stipulated in the contract. (Reis v. City of New York, 188 N. Y. 58; Batchelor v. Hinkle, 140 App. Div. 621; Ackerman v. True, 175 N. Y. 353; Brodley v. Degnon, 224 N. Y. 60; Brown-Brand Realty Co. v. Saks & Co., 126 Misc. Rep. 336; 218 App. Div. 827.)
   Per Curiam.

The contract of sale provided that the plaintiff’s title should be approved and insured by the Title Guarantee and Trust Company before the defendant should be obligated to accept the title and pay the purchase price. The record does not disclose an unequivocal approval of the title by the Title Guarantee and Trust Company. The defendant was not, therefore, bound to accept the title tendered.

We have examined the other questions urged by the appellant but deem it unnecessary to express any opinion in regard to them in view of our conclusion that there was not such an approval of the title by the title company as to require the defendant to go on with the contract. We leave the question open whether approval, if given, would have been a sufficient answer to the objection that the title was unmarketable.

The judgment should be affirmed, with costs.

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

Judgment affirmed.


author: Cardozo, Ch. J. Hubbs, J.

text:
    Jacob Thomann, Respondent, v. The City of Rochester, Appellant.

      (Submitted April 1, 1931;
    decided May 12, 1931.)

      Clarence M. Platt, Corporation Counsel (Charles B. Forsyth of counsel), for appellant.
    Compliance with the charter of the city of Rochester was a condition precedent to plaintiff’s right of action. (Meruk v. City of New York, 223 N. Y. 271; Reining v. Buffalo, 102 N. Y. 308; Squaw Island Freight & T. Co. v. City of Buffalo, 133 Misc. Rep. 64; Curry v. City of Buffalo, 135 N. Y. 366; Van Der Bergh v. City of New York, 203 N. Y. Supp. 130; Rice v. City of Mechanicville, 186 N. Y. Supp. 756; Vermeule v. City of Corning, 166 N. Y. Supp. 546; People v. McIntyre, 166 N. Y. Supp. 635; Malloy v. Village of Briarcliff Manor, 217 N. Y. 584; Rogers v. Port Chester, 234 N. Y. 182; Kellog v. New York, 44 N. Y. Supp. 39; Frank v. New York, 133 N. Y. Supp. 434; Jewell v. Ithaca, 76 N. Y. Supp. 126; Biggs v. City of Geneva, 90 N. Y. Supp. 858; Gold v. City of Kingston, 206 N. Y. Supp. 735; Lautman v. City of New York, 141 N. Y. Supp. 1042.) Section 632 of the charter of the city of Rochester is constitutional and provides a reasonable period of limitation. (Gilbert v. Ackerman, 159 N. Y. 118; Barry v. Port Jervis, 64 App. Div. 268.)

      Charles S. Gordon for respondent.
    The Rochester city charter has no application to a claim for a permanent injunction to restrain a continuing nuisance and, as an incidental, money damage. (Slight v. Gutzlaff, 35 Wis. 675; Flaxman v. City of New York, 98 Misc. Rep. 88; McDonough v. Mayor, 15 Misc. Rep. 593; Lamay v. City of Fulton, 109 App. Div. 424; Sammons v. City of Gloversville, 175 N. Y. 346.) The city of Rochester had. actual knowledge and sufficient notice of the existence and’continuance of the nuisance (Bullock v. Town of Dunham, 64 Hun, 380; Shaw v. Village of Potsdam, 11 App. Div. 508.) Even were it necessary to file a notice of claim under the Rochester city charter, it is not necessary to so file it when the act is caused by the city itself. (Dillon Mun. Corp. [5th ed.] § 1717; McCarthy v. City of Fulton, 182 App. Div. 337; Minton v. City of Syracuse, 172 App. Div. 39; Twist v. City of Rochester, 37 App. Div. 307; Wilson v. Troy, 135 N. Y. 96; MacMullen v. Middletown, 187 N. Y. 37; Sprague v. City of Rochester, 159 N. Y. 20; McNally v. City of Cohoes, 127 N. Y. 350; Cogswell v. N. Y., N. H. & H. R. R. Co., 103 N. Y. 10.) Section 632 of the charter of the city of Rochester is unconstitutional and void under the Federal and State Constitutions in that it deprives the plaintiff of his property without due process of law. (U. S. Const. 5th and 14th Amendts.; Const, of N. Y. art. 1, § 6; Barry v. Village of Port Jervis, 64 App. Div. 268; 180 N. Y. 521; Williams v. Village of Port Chester, 72 App. Div. 505; 183 N. Y. 550; Randolph v. Springfield, 31 A. L. R. 612; Gilbert v. Ackerman, 159 N. Y. 118; Gilman v. Tucker, 128 N. Y. 190; Parmenter
      v. State, 135 N. Y. 154; Walden v. Jamestown, 178 N. Y. 213; Green v. Village of Port Jervis, 55 App. Div. 58.)
   Cardozo, Ch. J.

The city of Rochester bought an abandoned quarry in 1924, and used it as a public dump. The plaintiff, a florist, occupied adjoining land for the uses of his business and also as a home. Noxious gases, smells and vermin, coming from the dump, impaired the comfort of his family and brought damage to his bulbs and flowers. He stood by inactive for nearly four years, though the nuisance and the damage were obvious at once. At length, in July, 1928, he filed a notice of claim with the defendant’s Common Council and also with its Corporation Counsel, and later, a notice of intention to sue. This action was begun the following December. The relief demanded was an injunction and damages in the sum of $20,000. The trial court gave an injunction, but held that under section 632 of the Rochester city charter, the damages could go no farther back than a period of thirty days before the filing of the claim. The defendant acquiesced in the award of an injunction. The plaintiff appealed from the curtailment of the damages. The Appellate Division reversed the judgment to the extent appealed from and granted a new trial. The ruling was that section 632 of the defendant’s charter was not intended to apply to a cause of action for a continuing nuisance, and that the result of so extending it would be an unconstitutional impairment of vested rights of property. The case is now here, with a stipulation for judgment absolute, upon an appeal by the defendant.

Section 632 of the Rochester charter (L. 1907, ch. 755) is quoted in the margin. It is almost as comprehensive as words could make it. By its express terms, the notice of claim must be presented whether the wrong be intermittent or continuing, and whether the remedy invoked be at law or in equity. If words so comprehensive do not reach the claim in suit, one is at a loss to imagine how any form of words would be sufficient to include it. Our ruling in Sammons v. City of Gloversville (175 N. Y. 346) is in no wise to the contrary. We held of the statute there before us that it excluded causes of action for continuing wrongs and remedies in equity with damages merely incidental. The draftsman of the Rochester statute has taken a leaf from that decision. He has supplied what was there omitted. There is no gap in his catalogue of remedies and wrongs.

We find nothing unworkable in the requirement of •notice as applied to the defendant’s nuisance. The wrong was a continuing one, with damages not exhausted by a single act, but steadily recurring. That being so, successive causes of action accrued in favor of the injured landowner as long as the wrong continued within the period of prescription (Meruk v. City of New York, 223 N. Y. 271, 276). He did not lose the right to some measure of relief by failing to give notice within the term of thirty days. What he lost was the right to include in the relief an award of damages antedating by more than thirty days the presentation of the notice in the statutory form (Meruk v. City of New York, supra).

The requirement is strict, but not so strict as to be arbitrary. A judgment against a municipal corporation must be paid out of the public purse. Raids by the unscrupulous will multiply apace if claims may be postponed till the injury is stale. The law does not condemn as arbitrary a classification of rights and remedies that is thus rooted in the public needs (Frasch v. City of New Ulm, 130 Minn. 41, 43; O’Neil v. City of Richmond, 141 Va. 168; Sheehy v. City of New York, 160 N. Y. 139, 143). The time allowed is short, yet adequate in general to enable diligence to move (Frasch v. City of New Ulm, supra, p. 44). We leave open the question whether an extension of the term is to be implied where the wrong, though it has been done, or the damage, though it has been suffered, is unknown to the claimant (cf. Williams v. Village of Port Chester, 72 App. Div. 505; 183 N. Y. 550; Winter v. City of Niagara Falls, 190 N. Y. 198, 203; Walden v. City of Jamestown, 178 N. Y. 213; Murphy v. Village of Ft. Edward, 213 N. Y. 397; see also the cases collated in 31 A. L. R. 619, note). Nothing in this record suggests disability or ignorance. There being opportunity for knowledge and competence to act, the statute gives the rule to which obedience is due. A rule may not be slighted as invalid as to all because exceptional conditions may make it void as to a few (Williams v. Village of Port Chester, supra).

Opportunity there was,— opportunity for the collection of the last dollar of the damage — if the plaintiff had not chosen to sleep upon his rights. He admits that the nuisance was apparent the moment that the dump was opened. Within thirty days thereafter he could have filed a single notice that would have covered all his damage, present or prospective, up to the commencement of the action if it was his purpose to sue at law, or up to the rendition of the judgment if he was to seek the aid of equity. He was not required to state the nature and extent ” of the damage with even approximate precision. The statute is explicit that he shall state them so far as it is then practicable.” There was no need for successive notices at intervals of thirty days until action was- begun. Still less was there need in proving blight of leaf and blossom to fix the point of time when the blight settled on the seed. The mie of damage to be applied is well settled in this State. If the remedy is at law, the plaintiff may recover the damages sustained up to the commencement of the action, and this is the limit of the recovery, except where the invasion is certain to be permanent (Dietzel v. City of New York, 218 N. Y. 270; Uline v. N. Y. C. & H. R. R. R. Co., 101 N. Y. 98). If the remedy is in equity, he may recover the damages sustained up to the date of the decree (Stowers v. Gilbert, 156 N. Y. 600; Pappenheim v. Metropolitan El. Ry. Co., 128 N. Y. 436). Whatever may be included in the suit may be included also in the notice which is preliminary to suit.

Not lack of opportunity, therefore, but indifference or forgetfulness is responsible for the plaintiff’s plight. He had the privilege if he had acted promptly upon the discovery of the nuisance to make demand for all the damages that had developed in the past and all that might develop afterwards until the conclusion of the trial. He ignored the obvious remedy that' was then ready at his hand. He waited for four years till the city was about to discontinue the offensive and unlawful use, and then came forward with a claim for the accumulated loss. This is the very evil that the statute was designed to cure. The evil is no less where the damages are demanded as incidental to an injunction than it would be if the prayer for an injunction had been .left out, and an action had been brought for the damages alone. Prompt service of the notice would have made it possible for the defendant to investigate the loss and ascertain whether the claim had been swollen in disfigurement of truth. Scrutiny becomes futile with the lapse of the obscuring years.

We are not forgetful of the fact that the bad conditions at the dump were known to the defendant’s mayor and to other public officers. The plaintiff was not relieved thereby of the duty to adhere to the statutory forms. What satisfies the statute is not knowledge of the wrong. What the statute exacts is notice of the “ claim.” Cases such as Wilson v. City of Troy (135 N. Y. 96) and Twist v. City of Rochester (37 App. Div. 307; 165 N. Y. 619) are quite beside the point. They deal with the notice that is necessary before a wrong can be imputed to a municipality as its corporate default. They have no bearing upon a statute which prescribes the remedial forms whereby the wrong, when imputed, is to be corrected or repaired. The Legislature has said that a particular form of notice, conveyed with particular details to particular public officers, shall be a prerequisite to the right to sue. The courts are without power to substitute something else.

Another requirement of the statute is yet to be considered, for it is made the basis of an argument by members of the court that there is no necessity for a notice unless the damages are to be recovered through a remedy at law. The statute tells us that notice shall be given whenever damages are demanded, whether the claim is one “ arising at law oi in equity, and enforceable or sought to be enforced at law or in equity.” The argument is, however, that these words, which on their face are so plain as to be hardly subject to construction, do not mean what they seem to say, or that the meaning must be rejected as too oppressive to be true. The supposed basis for this conclusion is a later provision of the same section to the effect that where claims are to be presented, no action shall be brought thereon until three months have elapsed from the time of presentation. Some of the members of the court believe that the application of that provision to claims for damages incidental to a suit for an injunction would render it unconstitutional, or at least would be the parent of intolerable hardship. The case is supposed of a trespass so flagrant that one’s dwelling or one’s factory is about to fall into the pit. We are asked whether the Legislature in such circumstances could postpone the equitable remedy for a period of months, or could separate the jurisdiction to enjoin from the jurisdiction, normally accompanying it, to give judgment for the damage. The argument draws a distinction between the activities of a municipality that are public or governmental and others (such as the maintenance of a dumping ground) which are said to be proprietary or corporate. As to the first class of claims the power of the Legislature by concession is plenary and absolute. It may condition them as it will, or even abolish them altogether (MacMullen v. City of Middletown, 187 N. Y. 37). Whether the power is without-limit where the activities are proprietary or corporate is a fair subject for debate. Whatever the scope of power, we are reminded of our duty to strain construction to the uttermost if by so doing we can give relief from injustice or oppression. The way out of the difficulty, so it is argued, is to hold that the statute is inapplicable in any of its provisions to claims for the recovery of damages enforcible in equity, and this in the teeth of the opening sentences of the statute which say that it is.

We think the case at hand does not call for an expression of opinion as to the validity or the meaning of the three months provision in its application to causes of action for equitable relief. If a suitor aggrieved by that provision were to challenge its validity in an action against a municipal corporation growing out of some activity not public or governmental, where the effect of the postponement of a remedy would be equivalent to a denial of justice altogether, many interesting questions would press for a solution. There would be need to consider to what extent the Legislature may abridge the jurisdiction of the Supreme Court by the destruction or impairment of equitable remedies (Constitution, art. VI, § 1; Matter of Berkovitz v. Arbib & Houlberg, 230 N. Y. 261, 274) and to what extent it may discriminate between one class of suitors and another, withdrawing remedies as to some while maintaining them as to others (Truax v. Corrigan, 257 U. S. 312, 313). If the question of power were answered in favor of the statute, there would remain questions as to meaning. We might hold not inconceivably that the only effect of the limitation would be to postpone the enforcement of the remedy for damages, and that the action could still be maintained as one for an injunction merely. We might hold that actions for damages, brought after the lapse of the prescribed interval, could thereafter be consolidated with the suit for an injunction or prosecuted separately if consolidation was no longer possible.

The plaintiff is not entitled to our judgment as to these and kindred problems, for whatever the validity or the meaning of the three months postponement of the remedy, his rights remain the same. A different question would be here if he had sued the defendant before the lapse of the three months and had lost his suit upon that ground. That is not what happened. He served his notice July 19, 1928, and his summons and complaint December 8, 1928, four and a half months later. Whether the requirement that he wait for three months be valid or invalid, he has chosen to obey it. If we assume it to be invalid, what is vicious in the statute may be severed from what is sound. If we assume it to be valid, there is no reasonable construction of its meaning that will override the requirement of notice whether the claim for damages be enforcible in equity or at law.

The case has been considered upon the assumption that the claim for damages has failed because of the delay in the service of the statutory notice. The objection would still remain as to the bulk of the demand that the plaintiff did not bring his suit within a year after the time when the damages were suffered (Rochester City Charter, § 632).

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

Hubbs, J.

(dissenting). The provision of the charter in question, if construed literally, prevents a party who is suffering an irreparable injury, because of acts being performed by the city in its proprietary or corporate capacity, from commencing an action in the Supreme Court and applying for an injunction to restrain such acts until three months have elapsed after presentation of the claim to the common council.” The provision, if valid, requires one whose property is being destroyed to stand by and see it destroyed without the right to prevent it by injunction. The effect of the statute would be to delay the right to apply to a court of equity for protection until the application would be useless, and by the enforced delay the party injured would be deprived of the court’s protection.

Jurisdiction in the Supreme Court to restrain, by injunction, the commission of irreparable injury has never been questioned. Such jurisdiction cannot be abrogated or abridged by statute, as it is conferred by the State Constitution. The Supreme Court is continued with general jurisdiction in law and equity.” (Constitution, art. VI, § 1.)

If the provision of the charter which forbids the commencement of an action is unconstitutional, in so far as it forbids the commencement of an equity action to restrain a continuing trespass or a continuing nuisance, without filing a claim and then waiting three months thereafter, it would seem to follow that the provision for filing a claim is unconstitutional when attempted to be applied to such actions.

“ The constitutional validity of law is to be tested, not by what has been done under it, but by what may, by its authority, be done.” (Stuart v. Palmer, 74 N. Y. 183, 188; People ex rel. Barnard v. Wemple, 117 N. Y. 77, 84; Gilman v. Tucker, 128 N. Y. 190, 200; City of Rochester v. West, 164 N. Y. 510.)

The fact that the plaintiff in this case waited more than three months after service of a notice of claim before commencing the action does not determine the validity of the statute or affect the question.

The order of the Appellate Division should be affirmed.

Pound, Lehman, Kellogg and O’Brien, JJ., concur with Cardozo, Ch. J.; Crane, J., dissents; Hubbs, J., dissents in opinion.

Ordered accordingly.

       Claims for damages; place of trial of actions and proceedings. All claims against the city for damages or injuries to person or property, invasions of personal or property rights of every name and nature whatsoever, whether casual or continuing, continuing and continuous trespasses, continuing and continuous invasions of property, continuing and continuous invasions of property rights, and all other claims for damages or injuries to persons or property, arising at law or in equity, and enforceable or sought to be enforced at law or in equity, alleged to have been caused or sustained in whole or in part by or because of any misfeasance, nonfeasance, negligence, omission of duty, wrongful act, fault or neglect on the part of the city or any of its agents, officers or employees, must be presented to the common council and the corporation counsel, in writing, within thirty days after such damages, or injuries to persons or property were sustained. Such writing must state the time when, the place where and the circumstances under which the damages or injuries were sustained and the particular cause thereof; it must also state so far as it is then practicable, the nature and extent of the damages or injuries; it must also state the place of residence of the claimant by street and number, and if there be no street or number, it must contain such statement as will disclose the place of residence; and all such claims must be verified by the oath of the claimants; and if it is intended to commence an action on such claim, notice of such intention, containing the amount demanded and the time and place of the damages or injuries must also be served on the corporation counsel within six months after such damages or injuries were sustained. No action may be maintained for damages or injuries to persons or property caused or sustained as aforesaid unless the claim therefor is presented to the common council and corporation counsel within thirty days and notice of intention is served upon the corporation counsel within six months, and the action is commenced within one year after such damages or injuries were sustained, but no such action may be brought until three months have elapsed after the presentation of the claim to the common council and the corporation counsel. This section applies to claims of infants and all other persons. The place of trial of all actions or proceedings against the city or its boards or officers, shall be in the_county of Monroe.


author: Kellogg, J.

text:
    In the Matter of the Application of The People of the State of New York, by James A. Beha, as Superintendent of Insurance, Appellant and Respondent, for an Order to Take Possession of the Property of the Second Russian Insurance Company, Appellant and Respondent. Howard Sutherland, as Alien Property Custodian of the United States, Respondent and Appellant.

      (Argued March 23, 1931;
    decided May 12, 1931.)

      James F. Donnelly, Alfred C. Bennett, John M. Downes and Clarence C. Fowler for Superintendent of Insurance, appellant and respondent.
    The demand of 1919 was ineffective to. vest title in the Alien Property Custodian as to commissions accruing thereafter. (Matter of Bendheim, 124 Misc. Rep. 424; 214 App. Div. 716; Matter of Sutherland, 23 Fed. Rep. [2d] 595; Farmers’ Loan & Trust Co. v. Miller, 2 Fed. Rep. [2d] 493; Kahn v. Garvan, 263 Fed. Rep. 909; Miller v. Rouse, 276 Fed. Rep. 715.)

      Robert J. Sykes, Paul Bonynge and Daniel A. Dorsey for Second Russian Insurance Company, appellant and respondent.
    The Custodian’s attempted seizure of future earnings under the contract was futile. (Noble v. Great American Ins. Co., 200 App. Div. 773; 235 N. Y. 589; Hart v. City Theatres Co., 215 N. Y. 322.)

      Nathan Ottinger and Charles J. Schuck for Alien Property Custodian, respondent and appellant.
    As the Custodian, by reason of the demand, had title to the commissions, his claim was entitled to preference over all others, regardless of their character, and the liquidator was holding property which belonged to the Custodian and not to the company. (Kohn v. Jacob & Kohn, 264 Fed. Rep. 254; Munich Reinsurance Co. v. First Reinsurance Co., 6 Fed. Rep. [2d] 742; Youghioheny v. Lasevich, 176 N. W. Rep. 815; United States v. Chemical Foundation, 272 U. S. 1; Banco Mexicano v. Deutsche Bank, 263 U. S. 591; Matter of Miller, 281 Fed. Rep. 164; Miller v. Lautenburg, 209 App. Div. 608; Central Union Trust Co. v. Garvan, 254 U. S. 554; Bean v. Stoddard, 207 App. Div. 276; Miller v. Kaliwerke Gesellschaft, 283 Fed. Rep. 746.) The demand operated, without service of any additional demands, to capture all commissions accruing after its date and even after the war, all of which commissions had accrued prior to the appointment of the liquidator herein. (Mutzenbecher v. Ballard, 16 Fed. Rep. [2d] 174; Miller v. Lautenburg, 239 N. Y. 132; United States v. Chemical Foundation, 272 U. S. 1; Matter of Bendit, 214 App. Div. 446; Matter of Bendheim, 214 App. Div. 716; Hess v. Miller, 6 Fed. Rep. [2d] 388; Matter of Miller, 281 Fed. Rep. 764; Rumely v. United States, 293 Fed. Rep. 532; Matter of Sutherland, 23 Fed. Rep. [2d] 595; Kahn v. Garvan, 263 Fed. Rep. 909; Miller v. Rouse, 276 Fed. Rep. 715; Garvan v. Marconi, 275 Fed. Rep. 486.)
   Kellogg, J.

The Second Russian Insurance Company of St. Petersburg, Russia, a Russian corporation, in July, 1913, entered into a contract with H. Mutzenbecher, Jr., of Hamburg, Germany, a partnership, for the establishment of a branch office in New York city, to conduct reinsurance business in the United States. Mutzenbecher was to act as general manager of the business in this country and was to receive for its services compensation to be equal to a certain percentage upon net premiums received. Mutzenbecher employed Meinel & Wemple, Inc., a New York corporation having its principal office in New York city, as its subagents to carry on the business. It procured the Second Russian to make a formal appointment of the Meinel company as its general agent and to issue to it a power of attorney. The Second Russian made deposit of the required amount of money, to enable it here to do business, in a New York bank, under a deed of trust. The statutory conditions having thus been complied with, the Second Russian secured offices in New York city, and through Mutzenbecher and its subagent Meinel & Wemple, Inc., began to function in this country as a reinsurer of fire risks directly written by other companies. A flourishing business was done through a period of years. Finally, in the early part of the year 1925, the State Superintendent of Insurance, acting under section 63, subdivision 1 (e), of the Insurance Law (Cons. Laws, ch. 28; Matter of People [Second Russian Ins. Co.], 244 N. Y. 606), which provided for such action when further transaction of business would be hazardous to its policy holders, or to its creditors, or to the public,” took possession of the property and business of the Second Russian, pursuant to an appropriate order duly obtained. Meanwhile, in June, 1919, the Alien Property Custodian, acting under the Trading with the Enemy Act (40 U. S. Statutes at Large, 411), had served a written demand upon Meinel & Wemple, Inc., managers of the New York branch of the Second Russian, to pay over to him all commissions payable to H. Mutzenbecher, Jr., an alien enemy, on account of business previously done, and all commissions which might become payable upon business done thereafter. At the date when the Superintendent took possession, unpaid commissions due Mutzenbecher, if due at all, calculated upon net premiums then previously received, totalled $79,261.11. Pursuant to a notice served by the Superintendent, calling for the filing of claims, the Alien Property Custodian filed a claim for commissions due. The claim was disallowed by the Superintendent. Later, the Special Term of the Supreme Court determined that the claim of the Custodian, then amounting, with interest added, to $140,788.73, was a “ Class 1 claim,” that it was entitled to be paid in preference to all other claims,” and directed the Superintendent of Insurance forthwith to pay over the amount named to the Alien Property Custodian. The Appellate Division modified the order in respect to the percentage of interest which was payable and otherwise affirmed.

The contract giving rise to the claim for commissions was made at St. Petersburg, Russia. The parties thereto were H. Mutzenbecher, Jr., a partnership composed of German citizens, and the Second Russian Insurance Company, a Russian corporation. As the claim originated in an alien country, through a contract between aliens, it was a foreign claim, not entitled to a share in the distribution made by the Superintendent of Insurance, from the funds received by him. (Matter of People [Norske Lloyd Ins. Co.], 242 N. Y. 148.) Of course, if the claim were protected by a lien, such as a mortgage, an attachment, or an equity in the nature of a hen, the title of the Superintendent to the funds taken over would be subject thereto, in so far as the lien bound any portion of the funds so taken, and the claimant would then be entitled to payment, to the extent that the funds so encumbered might pay him. (Matter of People [Second Russian Ins. Co.], 253 N. Y. 589.) The claimant may not succeed herein, therefore, unless, through his demand made in June, 1919, he acquired a property interest in or lien upon the specific funds now in the possession of the Superintendent, or in some portion thereof.

The contract entered into between the Second Russian Insurance Company and H. Mutzenbecher, Jr., in July, 1913, expresses an appointment of the Mutzenbecher firm as the exclusive representative of the Second Russian “ for doing Fire Re-insurance and /or Retrocession business with companies domiciled or represented in the United States of North America.” It recites that, at the request of Mutzenbecher, it has executed a full power of attorney, for the conduct of the business, to Meinel & Wemple, Inc. It provides that Mutzenbecher, as compensation for its services, will receive a commission of three and one-half per cent, “ computed on the annual Net-Premium on the treaties received from you.” Mutzenbecher is to bear all expenses and handle all business in the proper way. It is “ to establish an exact card system of the ceded risks, which will make it possible at any time to have a control on risk limits, to examine the losses, to examine the accounts of the ceding companies, as well as to execute the work, according to our instructions, for the necessary retrocessions.” In the event of cancellation of the agreement, commissions shall continue on all treaties then in force and while such treaties remain in force, i. e., as long as a business connection between us and those companies, which you brought or will bring in connection with us, exists.” However, Mutzenbecher “ is obliged to carry on in those cases the business according to the terms of this agreement even after cancellation of this agreement.”

It was pursuant to the terms of this contract that the New York branch of the Second Russian began to function under the management of Mutzenbecher’s subagents, Meinel & Wemple, Inc. Treaties of reinsurance were made with various insurance companies writing direct insurance, wherebjr the Second Russian took over risks previously insured and reinsured them. For this reinsuranee premiums became due from various companies to the Second Russian. Meinel & Wemple, Inc., collected these premiums. After deducting the required reserves for unearned premiums, and depositing the same with the New York Life Insurance and Trust Company, as trustee, Meinel & Wemple, Inc., transmitted the balance of the premiums received to Mutzenbecher at Hamburg, together with various documents in relation to the risks reinsured. From the amounts so received Mutzenbecher deducted the expenses of the business, and their own commissions at three and one-half per cent, and remitted the balance to the Second Russian. From their own commissions Mutzenbecher also remitted to Meinel & Wemple, Inc., three-quarters of one per cent of the net premiums, for the commissions of that corporation for doing the business in New York.

The Russian Government, in October, 1916, promulgated a ukase forbidding its citizens from entering into any commercial relations with citizens of its then enemy, the German Empire, and declaring at an end all existing relationships between the citizens of the two countries. Intercourse and business dealings between Mutzenbecher and the Second Russian were no longer possible, without violation of Russian law. Accordingly, the Second Russian, acting through its officials at St. Petersburg, made an agreement with Meinel & Wemple, Inc., whereby the latter should become its general agents in New York, and should receive for itself, as compensation for handling the business, commissions at the rate of three and one-half per cent on the net premiums received. Thereafter Meinel & Wemple, Inc., made no more remittances to Mutzenbecher in Hamburg. It continued to deduct from all net premiums received three and one-half per cent on account of commissions. Nevertheless, it retained for itself a sum equal only to three-quarters of one per cent of the net premiums, the precise sum paid to it during the Mutzenbecher management. The balance was withdrawn by it from the funds of the Second Russian, in its regular bank of deposit, and deposited to the credit of itself in the American Exchange National Bank where its own deposits were carried. On its books these deposits were made to appear as a “ suspense reserve account.”

Prior to the 15th day of October, 1918, there had been withdrawn from the funds of the Second Russian, and deposited to the credit of Meinel & Wemple, Inc., in the American Exchange National Bank, the sum of $15,801.31. This sum represented commissions at three and one-half per cent upon net premiums received after remittances to Mutzenbecher had ceased to be made, less three-quarters of one per cent deducted by Meinel & Wemple, Inc., as commissions for its services. On the books of the corporation these moneys appeared in a suspense reserve account.” On the day named the Alien Property Custodian made a demand for the moneys so deposited as moneys belonging to and reserved for H. Mutzenbecher, an enemy alien. In obedience to the demand the moneys were paid over. Thereafter, an action was brought by the Second Russian, to recover the moneys so paid, against the Alien Property Custodian, pursuant to section 9 of the Trading with the Enemy Act (40 U. S. Statutes at Large, 411).

The controversy thus arising was finally determined by the United States Supreme Court (Second Russian Ins. Co. v. Miller, 268 U. S. 552) in favor of the Alien Property Custodian. The court approved a finding by the trial court that the appointment of Meinel & Wemple, Inc., by the Second Russian, as its general agents in the United States in lieu of H. Mutzenbecher, Jr., after the promulgation of the Russian ukase of July, 1916, was fictitious; that it was made to avoid the appearance of violating the Russian law; that in point of fact the Mutzenbecher firm remained the general agents entitled to commissions at three and one-half per cent. Furthermore, it held that the sum of $15,801.31, which had been segregated from the general funds of the Second Russian and deposited in the American Exchange Bank, as “ a suspense reserve account,” had been so deposited for the benefit and to the use of H. Mutzenbecher, Jr.; that Mutzenbecher was the owner of the specific moneys so held. Thus the court said that the moneys in the suspense account were placed there “ for the benefit of the Mutzenbechers, with the knowledge and consent of the appellant ” (Second Russian); that the appellant was, therefore, in no different situation with respect to the fund “ than it would have been if it had paid over the commissions directly to the Mutzenbechers or to their authorized agent; ” that payment of the commissions was made as effectually as if the payment had been by cash in hand; ” that the appellant “ had relinquished all claim to the fund and Meinel held it for the Mutzenbechers.” In other words, the demand made by the Custodian was for a specific fund, which had been segregated from the funds of the Second Russian in its own bank of deposit, and placed to the credit of Meinel & Wemple, Inc., in a different bank, where it was held, as the court determined, for the benefit of H. Mutzenbecher. Therefore, H. Mutzenbecher had a property interest in the specific fund; therefore, the Custodian succeeded to an interest in specific property; consequently, the Second Russian had no interest therein.

The situation in respect to commissions, accruing, if at all, subsequently to the Custodian’s demand in October, 1918, is wholly different. On June 27, 1919, when the Custodian’s second demand was made, commissions calculated at three and one-half per cent on net premiums received, less commissions previously paid to the Custodian, totalled $13,032.43. Not a dollar of this amount had been withdrawn from the bank of deposit of the Second Russian; not a dollar had been segregated from its general funds and placed in a separate account in the same or any other bank. True, Meinel & Wemple, Inc., kept an account in the books of the Second Russian, wherein a sum equaling three and one-half per cent on net- premiums received monthly was debited as commissions, totaling $13,032.43 for the period since the previous demand. This debit, therefore, was at most an admission of a general indebtedness to H. Mutzenbecher, Jr. After the demand, and before the institution of liquidation proceedings by the Superintendent, additional commissions of $66,228.68 were debited to H. Mutzenbecher on the books of the Second Russian. No part of this sum, however, was segregated from the general funds, and placed in a separate bank account to the credit of Mutzenbecher, or to the credit of Meinel & Wemple, Inc., for the benefit of Mutzenbecher. In upholding the claim of the Custodian for the two items of $13,032.43 and $66,228.68, the Appellate Division seems to have assumed that these amounts had been placed in a special deposit for the benefit of Mutzenbecher. Such was not the fact, nor does the Custodian now assert it to have been. Nor is the theory, advanced by the Custodian, that as net premiums were received by the Second Russian a property interest therein immediately vested in Mutzenbecher, at all tenable. The contract, in relation to commissions payable by the Second Russian to Mutzenbecher, provided that the latter “ will receive from us a commission of 3| per cent computed on the annual Net-Premiums on. the treaties received from you.” Here is a promise that Mutzenbecher will receive from the Second Russian a commission to be calculated by multiplying the figure of net premiums which the Second Russian might receive by the figure .035; not a provision whereby Mutzenbecher would acquire a fractional interest in the premiums as the Second Russian received them.

As Mutzenbecher was never other than a general creditor of the Second Russian it is not possible to understand how the Custodian ever became other than a general creditor. Certainly, an assignment by Mutzenbecher to the Custodian would have transferred none other than a general debt; surely the demand could give rise to no greater property right. Nor, indeed, could the Alien Property Custodian under such a demand, or unless he asserted a legal right to the securities themselves, by capture, change the character of the enemy’s right as obligee.” “ Such a demand neither enlarges nor contracts the rights seized.” (Per Learned Hand, J., in Kahn v. Ganan, 263 Fed. Rep. 909, 912.) True, the Custodian might have enforced satisfaction of the claims existing in Mutzenbecher, if any, as the obligations matured, by a resort to summary process under section 17 of the Trading with the Enemy Act. However, the Custodian never so proceeded, and, therefore, never acquired title to any specific fund, or possession thereof. While Congress, for the purposes of the war, might have authorized the Custodian to take from an enemy alien every contract obligation owing to him, it could not well enlarge the contract duty of the obligor by converting a general debt into an obligation to pay over a particular fund. However, no such attempt was ever made by Congress. It is provided in section 7, subdivision c, of the Trading with the Enemy Act as follows: If the President shall so require, any money or other property owing or belonging to or held for * * * an enemy * * * shall be conveyed, transferred, assigned, delivered, or paid over to the alien property custodian.” Moneys which must be “ paid over ” are clearly moneys which constitute a specific fund held for the benefit of the enemy. A demand for the conveyance, transfer, assignment, delivery and payment of money or other property unless expressly qualified or limited shall be deemed to include every right, title, interest, and estate of the enemy in and to the money or other property demanded as well as every power and authority of the enemy thereover.” (Rule 2 (a), Executive Order of the President, Feb. 26, 1918; see Meares, Trading with the Enemy Act, p, 586.) In other words, the Custodian by his demand takes whatever title the enemy has; he takes and acquires no greater right.

If any authority were needed to support the proposition that the Custodian, by his demand upon the Second Russian that it pay the claim of its creditor, Mutzenbecher, acquired no lien upon the general funds of the Second Russian, theretofore unencumbered by such a lien, it may be found in the case of Simon v. Miller (298 Fed. Rep. 520). Simon had had financial dealings with Albert, an enemy aben. Originaby he believed that there was owing Albert a balance of $350,000. In this belief he deposited the amount named in the American Exchange Bank, and agreed that he would not pay any part thereof to Albert, or withdraw the same until the end of the war, except upon the signature of himself and his counsel, a person trusted by the Department of Justice. Two separate demands for the money were made upon the American Exchange Bank by the Custodian. A third demand was served upon Simon affecting to seize the debt from the bank to him upon the asserted theory that the deposit was held for Albert’s benefit. So far there was no attempt to seize the account between the plaintiff and Albert, but on June 1, 1920, such a demand was made on the plaintiff. This determined that Albert was an enemy and that the plaintiff owed Albert, on a statement of the account, the sum of $635,640.96. This sum the demand attempted to seize, and the plaintiff was forthwith required to pay it to the Custodian. After a htigation not necessary to set forth, the Custodian got possession of the deposit in the American Exchange Bank, which this petition was filed to recover.” The court held that the first three demands were ineffective for the reason that the bank did not hold the moneys in trust for Albert. As to the fourth demand, the court held that it was an effective capture of the debt owed by Simon to Albert but not effective as a capture of the bank deposit. It said, through Learned Hand, J., as follows: A creditor has no rights in his debtor’s assets and is not concerned with their fate. The debt remains a general obligation, regardless of their disposition. Whatever makes invalid any payment by the debtor protects the captor of the debt. No possession is necessary, because none is possible; the captor is secure so long as the debtor cannot discharge the debt. How, then, can it be argued that the scheme of the act involved a payment of the debt in prcesenti? The captor being protected, why must the debtor be exposed to execution in limine? ” Again, it said that such a theory as to the scheme of the act “ contradicts all our notions of the rights of putative debtors who dispute the debt;” that no such interpretation was called for; that “ captures had a double purpose. They changed the title in any actual rights which the enemy might have in the captured property, and they sequestered the property itself in which those rights might inhere;” but that these considerations cannot apply to the capture of a debt.” The court not merely denied the right of the Custodian, through his demand, to capture the specific fund deposited; it held that even though the Custodian had obtained actual possession thereof he might not apply it upon the debt which had been seized, but must return, it to the debtor.

We now make no determination as to the validity of any claim which may be made on behalf of Mutzenbecher as a general creditor, or on behalf of the Custodian, for that question is not presently before us.

The order of the Appellate Division and that of the Special Term should be reversed and the claim dismissed, with costs to the Superintendent of Insurance in this court and in the Appellate Division.

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

Orders reversed, etc.


author: Pound, J.

text:
    Josie G. Cashin, Respondent, v. City of New Rochelle, Appellant.

      (Argued April 1, 1931;
    decided May 12, 1931.)

      Patrick J. Rooney, Corporation Counsel, for appellant.
    The defendant is not responsible for an increased flow of water occasioned by city improvements. (Prime v. City of Yonkers, 192 N. Y. 105; Rutherford v. Village of Holly, 105 N. Y. 632; Lynch v. Mayer, 76 N. Y. 60; Anchor Brewing Co. v. Dobbs Ferry, 84 Hun, 274; Lessenger v. Harlan, 168 N. W. Rep. 803; Fox v. City of New Rochelle, 240 N. Y. 109; Noonan v. City of Albany, 79 N. Y. 470; North Dakota v. Minnesota, 263 U. S. 365; O’Donnell v. City of Syracuse, 184 N. Y. 1.) The trial court erred in allowing fee damage based upon a supposedly continuing cause when as a matter of fact the alleged injury was merely occasional and recurrent and can be remedied by either the city or the owner at any time. (Bartlett v. Grasselli Chemical Co., 27 A. L. R. 54; Matter of Village of Middletown, 82 N. Y. 196.) There is no evidence of rental damage due to the installation of the drain complained of. (Mailland v. Kerrigan, 187 N. Y. Supp. 495; Matter of West 205th Street, 240 N. Y. 68; Matter of Jennings Street, 207 App. Div. 170.) The court erred in allowing $28,500, representing the cost of building a new culvert to carry the flow of the brook through the plaintiff’s property, as fee damage. (Cooper v. New York, L. & W. Ry. Co., 122 App. Div. 128; Fromm v. Ide, 68 Hun, 310; Berg v. Parsons, 90 Hun, 267.) The court erred in allowing $12,000 fee damage for a continuing trespass in maintaining the mound or ridge over the sewer. (Dietzel v. City of New York, 218 N. Y. 270.) The plaintiff was not a party to the sewer right of way agreement and cannot sue for damages for condition broken. Those damages, if any, belong to the executors, administrators or assigns of the original party and not to plaintiff, as against whom the city has acquired a right to maintain the ridge by adverse possession. (Taylor v. N. Y. & H. R. R. Co., 27 App. Div. 190; Powlowski v. Mohawk Golf Club, 204 App. Div. 200; Prime v. City of Yonkers, 192 N. Y. 106; Miller v. Clary, 210 N. Y. 127; Kidder v. Port Henry Iron Ore Co., 201 N. Y. 445; 207 N. Y. 768; Beach v. Barons, 13 Barb. 305; Shalet v. Stoloff, 135 App. Div. 376.)

      Albert Ritchie for respondent.
    The defendant is liable to the plaintiff for collecting the surface waters into artificial channels and dumping them suddenly and in great volume on her property. (Hentz v. City of Mt. Vernon, 78 App. Div. 515; Fox v. City of New Rochelle, 240 N. Y. 109; Noonan v. City of Albany, 79 N. Y. 470; Chapman v. City of Rochester, 110 N. Y. 273; Butler v. Village of Edgewater, 6 N. Y. Supp. 174; Lumley v. Village of Hamburg, 181 App. Div. 441; Mendelson v. State of New York, 218 App. Div. 210.) The evidence justifies the amount of permanent damage awarded and there was no error in the admission of evidence on this point.
      (Hartshorn v. Chaddock, 135 N. Y. 116.) The allowance for rental damage was extremely moderate. (Colrick v. Swinburne, 105 N. Y. 503; Prime v. City of Yonkers, 131 App. Div. 110; Matter of Simmons, 138 App. Div. 350; 195 N. Y. 575; Matter of Armory Board, 73 App. Div. 152; Matter of Bronx Parkway Comm., 191 App. Div. 212; Matter of City of New York, 197 App. Div. 432; Mendelson v. State of New York, 218 App. Div. 210.) The construction of the mound or ridge through the plaintiff’s property, over the sewer, is a wrong for which plaintiff is entitled to redress. (Fox v. City of New Rochelle, 209 App. Div. 889; 240 N. Y. 109.) The plaintiff being the successor in title to the original party to the agreement, is entitled to maintain the action. (Henneky v. Stark, 128 N. Y. Supp. 761; Munro v. Syracuse, L. S. & N. R. R. Co., 200 N. Y. 224; Miller v. Crary, 210 N. Y. 127; Nye v. Hoyle, 120 N. Y. 195; Mott v. Oppenheimer, 135 N. Y. 312; Trustees v. Lynch, 70 N. Y. 440; Satterlee v. Erie R. R. Co., 113 App. Div. 462.)
   Pound, J.

The complaint herein states two causes of action, one for an injunction and damages for the discharge on plaintiff’s premises of surface waters collected in a single channel and thereby, as is alleged, cast in a substantially increased volume on such premises; another to require the defendant to remove a ridge or mound of earth left across plaintiff’s premises after the construction of a sewer on a right of way over such premises granted by the then owner thereof in the year 1894 or to pay damages. The plaintiff’s recovery is for the sum of $55,500 damages, being $15,000 for damages to rental value for six years prior to the commencement of this action; $28,500 for damages to fee value due to overflowing of lands, and $12,000 damages to fee value due to the ridge left on the premises after the construction of the sewer.

Burling brook is an old natural watercourse running through plaintiff’s property, carrying off surface waters from the neighborhood watershed. Plaintiff’s property is a parcel of low, vacant land which has a frontage on Weyman avenue in the city of New Rochelle of 481 feet. It slopes from both sides towards the brook which is the lowest point thereof. It is described as a small farm or vegetable garden of 8.6 acres and is leased for such purposes for $300 a year, but its prospective value for industrial and business purposes is large. It is zoned for such purposes and the city’s witnesses value it at $125,000.

The evidence justifies the conclusion that in or about the year 1921 the city constructed artificial channels which collected surface waters and discharged the same into Burling brook where they would naturally go. It is contended that the force and volume, if not the quantity, of water was thereby substantially increased, independently of the increased flow of surface water caused by city improvements such as the paving of streets and building of houses or by heavy rains and that plaintiff has sustained damages by reason of such increased force and volume for which the city is liable. (Fox v. City of New Rochelle, 240 N. Y. 109, 112.) The Fox case, it will be noted, came up on an appeal from a unanimous affirmance under the Constitution of 1894, before the Judiciary Article was amended in 1925, and the only questions before the court were those considered in the opinion.

The mere facts that the city has collected surface waters in a single channel and that the brook has at times overflowed its banks are not sufficient to impose liability on the city. The relation of cause and effect must be established. The burden is on the plaintiff to establish that the flooding was caused by the construction of artificial channels rather than by unprecedentedly heavy rains. (North Dakota v. Minnesota, 263 U. S. 365.) The respondent concedes in her brief that the flooding occurs only during heavy rains. The tenant of the premises testifies that there has been no change in the condition in that respect since he began to cultivate the land in 1920. While this may be regarded as a question of fact, as other witnesses testify to substantially increased overflowing in 1927 “ on account of the big flood,” there is no evidence of any substantial overflow of plaintiff’s lands, except intermittently and occasionally in times of heavy rains, which is attributable to the construction of the city drain, independent of natural causes.

We held in the Fox Case (supra) that it was error to limit the amount of surface water to be discharged into Burling brook to the amount as it existed at any prior date and that the city is not hable for the natural flow of surface water. As the city cannot be compelled to construct drains for the disposal of surface water, however injurious the result may be to the owner of land through which a natural watercourse runs, we must scrutinize the proof on which rests the substantial award of damages herein in order to separate the right from the wrong.

In so doing we are led to the following conclusions: The evidence indicates no permanent condition of overflowing but only recurring single instances in time of heavy rains, giving rise to a separate and complete cause of action, if any, in favor of plaintiff each time her lands are wrongfully flooded. (Meruk v. City of New York, 223 N. Y. 271, 274, 276.) The award of damages for conditions of a permanent character was not warranted.

But if we proceed on the theory that the plaintiff’s injuries are of a permanent character, she is not materially benefited. Let us consider:

First, evidence of rental value. The proof on this point seems altogether theoretical, vague and speculative. How. has the overflow attributable to the drain alone affected rental value? What would be the rental value of the premises without such additional overflow? What is the rental value of the premises with it? Such is the true measure of damages. Witnesses base their estimate on ten per cent of the market value of the land as a fair rental value of lands in general and value the land at $231,843, less the engineer’s estimate of $43,500 for constructing a covered drain across the property and filling in the low land to the street level. They then make the loss of rental value ten per cent of $43,500 annually, or more than $23,000 since the construction of the drain. No competent proof of any loss of rental value was adduced on the trial. It did not appear that the property would have rented more readily if the lands were not occasionally overflowed or that there had been any demand for such property except for farming purposes. The estimate based on the value of the land, while fair enough as to leased property in general, is inapplicable to land which had been leasable for farm purposes only, while awaiting a prospective market for business purposes, in the absence of proof tending to establish that the lands might have been rented to better advantage if they had been subject only to the natural flow of surface waters. A fair rental value is what a man may reasonably expect to obtain for his lands as tested by experience rather than by an arithmetical formula. Such doctrinaire disregard of circumstances as is displayed by plaintiff’s witnesses establishes no loss of income from rents. If the owner cannot expect to lease his land for any purpose, he is not to be awarded damages because he does not lease it. He would thereby be taking out the speculative unearned increment in advance.

Secondly, evidence of actual value. The witnesses say that the construction of a covered drain across the premises would cost $28,500 and that such is the measure of damages for flooding the land, i. e., the cost of removing all the waters that now flow on the surface, through an artificial channel. But it does not appear that this expense is less than the difference in value between the land subject to occasional overflows by reason of increased volume of water in time of heavy rains due to the construction of the channel complained of and to the same land free from such increased overflows. Such is the ordinary measure of damages. Common sense suggests that this difference is nominal rather than substantial. The ideas of experts cannot make it otherwise.

As to the second cause of action. In 1894 Anne Cashin, the owner of the premises, granted the city (then village) and the Commissioners of Sewers thereof a right of way across the land for the construction and maintenance of sewers, subject to the condition that " fences and grounds disturbed or removed by said parties * * * for any of the purposes aforesaid shall be restored to the same condition as found by ” such parties. When the sewer was constructed more than thirty years ago, a mound or ridge of earth between eighteen and twenty feet wide was left four or five feet higher than the former level of the ground, running across the premises. Plaintiff has been awarded $12,000 damages to the actual value of the land, being the estimated cost, not of leveling the surface of the ground to its former condition, but of filling, in the property to the level of Weyman avenue, which it adjoins, to a depth of eleven feet. The award has been made on the theory that the mound or ridge is a continuing nuisance or trespass and that the cause of action therefor is not barred by the Statute of Limitations, except as to damages accrued more than six years prior to the commencement of the action. (Colrick v. Swinburne, 105 N. Y. 503; Reed v. State, 108 N. Y. 407.) But the mound or ridge is no tortuous injury to the land; no wrong exclusive of contract. It is on the right of way. At most, it was so left in breach of the condition on which the right of way was granted, i. e., to restore the land to the condition in which it was found before the sewer was constructed in 1894. This condition was not a covenant which passed with the land to which it was incident. The right of way was granted on a condition personal to the grantor, which she alone could enforce. (Cole v. Hughes, 54 N. Y. 444; Guaranty Trust Co. v. N. Y. & Q. C. Ry. Co., 253 N. Y. 190, 204.) It is too late a day for the assertion of rights which came into existence nearly thirty years ago and have been lying dormant until this action was begun.

As it would be a fine thing for plaintiff to have the land improved at the cost of the city by the construction of a covered drain across it, so she wpuld be greatly benefited if the property were filled in to the street level, but on this theory of the case the city has reduced the amount of fill necessary for this purpose by partly making it to the extent of a ridge eighteen or twenty feet wide and four or five feet high. Yet the cost of the completed fill is urged as the measure of damages chargeable against the city.

A suitor has the right to be protected against loss attributable to another’s wrong. In general, injuries to property, unattended by any species of aggravation, are followed by damages proportioned to the actual pecuniary loss sustained. This may be a nominal or a substantial amount. The' question is, what amount will restore the owner to his original position?

To improve plaintiff’s property, as it must be improved to make it available for business purposes, by covering Burling brook and filling to the street level, is to better conditions for plaintiff rather than to reimburse her for damages due to defendant’s wrong. It may be that the city is responsible in some small degree for damages it has caused by permitting an intermittent increase in the volume of overflow on plaintiff’s lands, but conditions are in large measure due to natural causes acting upon the structure and conformation of the land. To hold that the city should be cast in substantial damages for such conditions without fault on its part would be to extend the doctrine of municipal liability beyond all reason and authority.

The judgment should be reversed, a new trial granted as to the first cause of action and the complaint dismissed as to the second cause of action, with costs to the defendant in all courts.

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

Judgment accordingly.


author: Crane, J.

text:
    In the Matter of the Claim of Paul Helfrick, Respondent, against Dahlstrom Metallic Door Company et al., Appellants. The State Industrial Board, Respondent.
    (Argued March 26, 1931;
    decided May 12, 1931.)

      Robert H. Jackson for appellant.
    The validity of section 20 of the Workmen’s Compensation Law has not been adjudged by controlling Federal authority; the Supreme Court of the United States has indicated its invalidity and the interpretation of the New York act by its courts brings it within the condemnation of the Supreme Court. (Booth Fisheries v. Industrial Comm., 271 U. S. 208; Jensen v. Southern Pacific Co., 215 N. Y. 514; Jeffrey Mfg. Co. v. Blagg, 235 U. S. 51; Southern Pacific Co. v. Jensen, 244 U. S. 205; New York Central R. R. Co. v. White, 243 U. S. 188; Mountain Timber Co. v. Washington, 243 U. S. 219; Ward v. Krinsky, 259 U. S. 503; Quong Wing v. Kirkendall, 223 U. S. 59; Hawkins v. Bleakly, 243 U. S. 210; Heitz v. Ruppert, 218 N. Y. 148; LaFleur v. Wood, 178 App. Div. 397; Benjamin v. Rosenberg, 180 App. Div. 234; Kade v. Greenhut Co., 193 App. Div. 862; Rugg v. Norwich Hospital, 205 App. Div. 174; Cohen v. Ashford Plumbing Co., 203 App. Div. 261.) The Supreme Court of the United States holds that decrees of administrative tribunals taking property must be subject to judicial review on both law and fact to comply with the requirement of due process of law. (Ohio Valley Water Co. v. Ben Avon Borough, 253 U. S. 287; Chicago, M. & St. P. Ry. Co. v. Minnesota, 134 U. S. 418; Bluefield Water Works v. Public Service Comm., 262 U. S. 679; Yick Wo v. Hopkins, 118 U. S. 356; Plymouth Coal Co. v. Pennsylvania, 232 U. S. 531; Bradley v. Richmond, 227 U. S. 477; New York ex rel. Lieberman v. Van De Carr, 199 U. S. 552; Lehigh Valley R. R. Co. v. Board, 278 U. S. 24; Pine v. State Industrial Comm., 229 Pac. Rep. 784; Public Service Gas Co. v. Board of Public Utility, 84 N. J. Law, 463;
      Borgnis v. Falk Co., 147 Wis. 327; Nega v. Chicago Railways, 317 Ill. 482.) If the award of the Industrial Board is exempt from review upon the ground that it is a judicial rather than a legislative act, section 20 is void under the equal protection clause. (Nega v. Chicago Railways Co., 317 Ill. 482; Long Island Water Co. v. Brooklyn, 166 U. S. 685; Chicago, B. & Q. v. Chicago, 166 U. S. 226; Kade v. Greenhut,Inc., 193 App. Div. 862; Matter of Case, 214 N. Y.199; Hudson v. R., W. & O. R. R. Co., 145 N. Y. 408; Laidlaw v. Sage, 158 N. Y. 73; McKellar v. American Synthetic Dyes, 229 N. Y. 106; Healey v. Clark, 120 N. Y. 642; Howatt v. Kansas, 258 U. S. 181; Hawkins v. Bleakly, 243 U. S. 210; Borgnis v. Falk Co., 147 Wis. 327; Hart v. Industrial Accident Comm., 71 Cal. App. 542; Alabama Freight Co. v. Hunt, 29 Ariz. 419; Green v. Caldwell, 170 Ky. 571; U. S. Casualty Co. v. Hampton, 293 S. W. Rep. 260; Gilman v. Tucker, 128 N. Y. 190; Rosin v. Linderwood Mfg. Co., 89 App. Div. 245; Truax v. Corrigan, 257 U. S. 312.)

      John J. Bennett, Jr., Attorney-General (E. C. Aiken of counsel), for respondent.
    Section 20 of the Workmen’s Compensation Law is constitutional. (Jensen v. Southern Pacific Co., 215 N. Y. 514; New York Central R. R. Co. v. White, 243 U. S. 188; Mountain Timber Co. v. Washington, 243 U. S. 219; Hawkins v. Bleakly, 243 U. S. 210; Ohio Valley Water Co. v. Ben Avon Borough, 253 U. S. 287; Bluefield Water Works v. Public Service Comm., 262 U. S. 679; Booth Fisheries v. Industrial Comm., 271 U. S. 208; McKane v. Durston, 253 U. S. 684; Reetz v. Michigan, 188 U. S. 505; Standard Oil Co. v. Missouri, 224 U. S. 271; Radio Comm. v. General Electric Co., 281 U. S. 464; Dohany v. Rogers, 281 U. S. 302.)
   Crane, J.

On March 23, 1929, Paul Helfrick, of Jamestown, New York, was employed as a blacksmith by Dahlstrom Metallic Door Company, of the same place. While engaged in the regular course of his employment on that day he accidentally injured his fingers, for which the State Industrial Board has made him an award of $395.41. The employer and the insurance carrier challenge the award on the ground that the procedure under our State Workmen’s Compensation Law (Cons. Laws, ch. 67) has, or will deprive the employer of his property without due process of law, in that the Board has been made the final arbiter of the facts without any review upon the weight of evidence in a court of law.

The Labor Law of the State (Cons. Laws, ch. 31) by section 12 provides for an Industrial Board, consisting of five members, at least one of whom shall be an attorney and counselor at law duly admitted to practice in the State. The members are appointed by the Governor by and with the advice of the Senate, the term of office being six years. Each member is obliged to take the constitutional oath of office.

The Workmen’s Compensation Law, by section 20, gives to this Board full power and authority to determine all questions in relation to the payment of claims presented to it for compensation. The Board shall make or cause to be made such investigation as it deems necessary, and upon application of either party shall order a hearing, and within thirty days after a claim is submitted shall make an award and file the same in the office of the department. This section further provides as follows: “ The decision of the board shall be final as to all questions of fact, and, except as provided in section twenty-three, as to all questions of law.”

Section 23 provides for an appeal to the Appellate Division of the Supreme Court within thirty days after the award or decision is made. The Board may also of its own motion certify to such Appellate Division questions of law involved in its decision. The Board shall be deemed a party to every such appeal, and the Attorney-General, without extra compensation, shall represent it. From the decision of the Appellate Division an appeal lies to this court where the decision has not been unanimous in the Appellate Division, or the consent of that court or of this court has been obtained. Such appeals are subject to the law and practice applicable to appeals in civil actions.

In Pine v. State Industrial Comm. (107 Okla. 40) and Public Service Gas Co. v. Board of Public Utility Commrs. (84 N. J. L. 463) similar statutory provision, making a decision of a commission final as to the facts, was interpreted to mean final as a termination which ended the proceedings, and, therefore, did not attempt to take from the courts a constitutional power to review the facts. Although by article VI, section 1, of our State Constitution, the Supreme Court is continued with general jurisdiction inlaw and equity, subject to such appellate jurisdiction of the Court of Appeals as now is or may be prescribed by law, the same Constitution, subsequent to Ives v. South Buffalo Ry. Co. (201 N. Y. 271), was amended by article I, section 19, to read as follows: " Nothing contained in this Constitution shall be construed to limit the power of the Legislature to enact laws for the protection of the lives, health, or safety of employees; or for the payment, either by employers, or by employers and employees or otherwise, * * * of compensation for injuries to employees or for death of employees resulting from such injuries without regard to fault as a cause thereof, * * * for the adjustment, determination and settlement, with or without trial by jury, of issues which may arise under such legislation; * * * ” etc.

This court in 1916 decided in Matter of Heitz v. Ruppert (218 N. Y. 148) that the decision of the Commission or the State Industrial Board was final on all questions of fact, and such has been the practice in this State ever since that time. The decision by the Board does not take from the courts any of the powers invested in them by the State Constitution as was the instance in the Oklahoma and New Jersey cases above cited. Such limitation of review upon appeal is not illegal under our State form of government.

What, however, is the effect of the Federal Constitution under the due process clause of the Fourteenth Amendment? Our Workmen’s Compensation Law was before the United States Supreme Court in New York Central R. R. Co. v. White (243 U. S. 188, 194, 207), and the opinion of Mr. Justice Pitney refers to the effect of the decision on the facts by the Commission or Board. He there stated: “No question is made but that the procedural provisions of the act are amply adequate to afford the notice and opportunity to be heard required by the Fourteenth Amendment.” True, the court’s attention was addressed to the law as a whole and not particularly to this question of the finality of the Board’s decision on a question of fact. A similar statute was reviewed in Mountain Timber Co. v. Washington (243 U. S. 219).

The procedure under our statute appears to comply with all the requirements of due process. A claim is presented to the State Industrial Board and an opportunity is afforded for a hearing of all parties interested — the employee, the employer, the insurance carrier and any and every witness whom the parties desire to call. The hearing is conducted much like a trial with more liberality as to rules of evidence than is permitted in the ordinary case in court. When the decision is made an appeal lies by either party to the Appellate Division. That court must determine whether or not on the review of the facts there be any evidence to sustain the award. The Industrial Board or the Commission cannot make an award without evidence to support it, and this question is always open in the courts on appeal both to the Appellate Division and finally to this court. Only where there is a conflict in evidence, or the reasonable inferences to be drawn from the evidence, is the decision of the Board or Commission of this conflict conclusive. This procedure meets all the requisites of due process as recently declared in Dohany v. Rogers (281 U. S. 362, 369), where Mr. Justice Stone, writing for the court, said: “The due process clause does not guarantee to the citizen of a state any particular form or method of state procedure. Under it he may neither claim a right to trial by jury nor a right of appeal. Its requirements are satisfied if he has reasonable notice and reasonable opportunity to be heard and to present his claim or defense, due regard being had to the nature of the proceeding and the character of the rights which may be affected by it. * * * Nor does the equal protection clause exact uniformity of procedure. The Legislature may classify litigation and adopt one type of procedure for one class and a different type for another.”

Neither does the hearing before the Industrial Board lack the elements of due process because the members of that Board may be laymen and not lawyers duly admitted to practice within this State. Unlike our own State Constitution there is nothing in the Federal Constitution or the acts of Congress, including the United States Judicial Code (United States Code, title 28, part 1, ch. 1), which requires judges of courts, Federal or State, to be lawyers or admitted to practice. The United States government in seeking men for its judiciary or for its United States Attorneys-General or district attorneys cannot be cramped in selection by the Legislatures of the States controlling admissions to the bar. There is no Federal question, therefore, involved in the personnel of the State Industrial Board. Due process aims at fair dealing, adequate hearing, impartial decision, and the procedure to insure these, rather than with the personal equipment of the deciding body. Some things in government must be left to the sound discretion of the appointing power.

That the determination of commissioners appointed to condemn property for water supply may be conclusive as to value was determined in Long Island Water Supply Co. v. Brooklyn (166 U. S. 685, 695). There is no denial of due process,” said the court, “ in making the findings of fact by the triers of fact, whether commissioners or a jury, final as to such facts, and leaving open to the courts simply the inquiry as to whether there was any erroneous basis adopted by the triers in their appraisal, or other errors in their proceedings.”

As to the action of the Interstate Commerce Commission, the Supreme Court, in Interstate Commerce Comm. v. Union Pacific R. R. Co. (222 U. S. 541, 547), said: “ Its conclusion, of course, is subject to review, but when supported by evidence is accepted as final; not that its decision, involving as it does so many and such vast public interests, can be supported by a mere scintilla of proof — but the courts will not examine the facts further than to determine whether there was substantial evidence to sustain the order.” (See, also, Crane v. Hahlo, 258 U. S. 142.) This is the same duty which rests upon the appellate courts of our State in reviewing the determination of the Industrial Board in workmen’s compensation cases. In point is Wheeling Corrugating Co. v. McManigal (41 Fed. Rep. [2d] 593.)

The appellant claims that the case of Ohio Valley Water Co. v. Ben Avon Borough (253 U. S. 287) has modified all this. Such is not the fact. The fixing of rates to be charged by a public service corporation is held by the Federal court to be legislative in nature, and no action of a commission or a public regulating board can deprive the courts of the right and power to determine whether the rate is confiscatory. Such is the Ben Avon case, and nothing more. The State Legislature cannot arbitrarily fix rates so low that a public utility corporation will not receive a fair return on its capital. Although hearings may be had before a legislative committee, yet they are so lacking in the elements of a judicial proceeding that the rate, when ultimately fixed, is nevertheless considered the fiat or act of the Legislature. The act or determination does not change its nature when passed on to another body created by the Legislature and termed a public service commission or utility board. It performs the same work in fixing rates as does the Legislature. The rate directed or permitted to be charged and collected must be subject to review by the courts when claimed to be an illegal taking of property. This distinction has been reiterated in Bluefield Water Works & Improvement Co. v. Public Service Comm. (262 U. S. 679, 683), where it was stated: The prescribing of rates is a legislative act. The commission is an instrumentality of the State, exercising delegated powers. Its order is of the same' force as would be a like enactment by the legislature.” (See, also, Lehigh Valley R. R. Co. v. Board of Public Utility Commrs., 278 U. S. 24.)

As a utility rate is generally fixed after an inquiry as to the facts by some legislative committee or public service commission, the Ben Avon case has awakened some comment. (See Yale Law Journal, vol. XXX, pp. 681, 781; Harvard Law Review, vol. XXXIV, p. 862, and vol. XXXV, p. 139.) But there is a great body of authority that the full force and effect of the due process clause cannot be preserved if the rate-making power is removed from judicial investigation. So many are the complications in determining the question of fair return that necessity, not theory, has moved the courts to this conclusion.

Whatever confusion, however, there may be in distinguishing legislative from judicial acts regarding rates does not arise in determining the status or injuries of a workman. Here the Board or Commission determines the events that have passed — the employment, the wages, the accident, the injury. Such readily submit to oral proof, and the process of finding them is of a judicial nature. Such a Board has the dignity and the form of many of our courts, the only distinction being that of name.

We conclude that the points raised by the appellant are without merit, and that our Workmen’s Compensation Law does not violate any provision of the Federal Constitution. The Supreme Court of Illinois in Nega v. Chicago Railways Co. (317 Ill. 482) arrived at the same conclusion.

Hawkins v. Bleakly (243 U. S. 210); Booth Fisheries Co. v. Industrial Comm. (271 U. S. 208) dealt with compensation acts which were elective on the part of the employee. The order should be affirmed, with costs.

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

Order affirmed.