author: Loughran, J. Finch, J.

text:
    In the Matter of Erwin W. E. Watermeyer, Appellant, against Ruth M. Mitchell et al., Constituting the Board of Inspectors of Election and Registration of the Second Election District of the Thirteenth Assembly District in the County of New York, Respondents.

      Argued April 27, 1937;
    decided July 13, 1937.

      Melvin L. Krulewitch and Manuel Weiss for appellant.
    The mere fact that appellant takes a course at Columbia University does not deprive him of the right to vote. (Matter of Ward, 29 Abb. N. C. 187; Matter of Goodman, 146 N. Y. 284; Matter of Garvey, 147 N. Y. 117; Matter of Barry, 164 N. Y. 18; Matter of Blankford, 241 N. Y. 180; Chomeau v. Roth, 72 S. W. Rep. [2d] 997; People v. Osborn, 170 Mich. 143; Sanders v. Getchell, 76 Me. 158.) The mere fact that the appellant lives in a residence hall does not deprive him of bis right to vote. (Matter of Garvey, 147 N. Y. 117; Matter of Barry, 164 N. Y. 18.)

      Paul Windels, Corporation Counsel (Seymour B. Quel and Russell Lord Tarbox of counsel), for respondents.

      The petitioner’s residence in a dormitory was acquired because be is a student at Columbia University and does not entitle him to register under the provisions of section 3 of article 2 of the State Constitution and section 151 of the Election Law (Cons. Laws, ch. 17). (Matter of Blankford, 241 N. Y. 180; Matter of Barry, 164 N. Y. 18; Matter of Garvey, 147 N. Y. 117; Matter of Goodman, 146 N. Y. 284; Matter of Trovinger, 242 App. Div. 804; Matter of Gardiner, 183 App. Div. 491; Matter of McCormack, 86 App. Div. 362.)
   Loughran, J.

The question is whether in 1936 the petitioner had acquired the domicile requisite to his registration as a voter in the second election district of the thirteenth Assembly district of the county of New York.

His petition alleges: “I reside at 1116 Amsterdam Avenue, a residence hall, for the past two years. Previous to that I resided in other places within the Second Election District of the Thirteenth Assembly District. I was born in Hamburg, Germany, on July 3rd, 1907, and arrived in the United States on July 11th, 1925. I was naturalized as an American citizen on February 16th, 1933, in the United States District Court for the Southern District of New York — certificate No. 3,679,369. My residence at the time I became a citizen of the United States was 1124 Amsterdam Avenue, also a residence hall of Columbia University, and within the Second Election District of the Thirteenth Assembly District. I am a teacher at Brooklyn College, New York, being employed by the City of New York in that capacity, and give instructions both during the day and evening sessions. I have been teaching at Brooklyn College for about two and a half years. I received my Bachelor of Arts degree from Columbia University and likewise my Master of Arts degree, and I am taking a single course at Columbia University, incidental to my work in Physics. My parents reside in Manizales, Republic of Colombia, South America, and have lived there since 1926. When I came from Germany in 1925 we lived together for a short while and then my parents migrated to their present South American residence and I took up my residence in 1926 in the Second Election District of the Thirteenth Assembly District, where I have continuously resided since then for the past ten years. * * * My intention is to remain indefinitely at my present address, 1116 Amsterdam Avenue, where I maintain my legal and permanent residence for all purposes, and have all my personal belongings with me. * * It is conceded that 1116 and 1124 Amsterdam avenue are the street numbers of dormitories at Columbia University and that the petitioner’s occupancy of living quarters at either address has at all times been conditioned upon his taking at least one of the courses of study offered by that institution.

For the purpose of voting, no person shall be deemed to have gained or lost a residence, by reason of his presence or absence, while employed in the service of the United States; nor while engaged in the navigation of the waters of this State, or of the United States, or of the high seas; nor while a student of any seminary of learning; nor while kept at any almshouse, or other asylum, or institution wholly or partly supported at public expense or by charity; nor while confined in any public prison.” (State Const., art. II, §• 3.) Thus petitioner’s mere presence at Columbia University as a student thereof is irrelevant to the issue. He must show by other and independent facts that the election district in which the university is located has been adopted by him as a home. (Matter of Blankcford, 241 N. Y. 180.) This, we think, he fails to do.

No reference is made to any act of the petitioner done within the election district that was unrelated to his presence there as a student of a seminary of learning. (See Matter of Barry, 164 N. Y. 18, 21.) It does not appear nor is it claimed that he was ever in the district before that presence began. His assertion of intention to remain indefinitely at his present address is not the equivalent of a statement that he intends to reside indefinitely in the election district. It is no more than a declaration of his purpose to have no other habitation while his course of study continues. This, as we have often said, is not enough. If it be the fact that the petitioner has completely severed his family ties that circumstance does not alter the case. (Matter of Blankford, supra.)

“ It may be urged that the enforcement of this rule will render it well nigh impossible for a student to establish a residence in a seminary of learning, but the very obvious answer is that the letter and spirit of the Constitution contemplate such a result.” (Matter of Garvey, 147 N. Y. 117,123.)

The order should be affirmed, without costs.

Finch, J.

(dissenting). The constitutional provision (N. Y. Const., art. II, § 3) and the corresponding statute (Election Law [Cons. Laws, ch. 17], § 151) was discussed as to its meaning and purpose in the Constitutional Convention of 1867. Prior to that time there had existed no such provision. Ex-Chief Judge Andrews said in the debate: “ If a student had no other residence than where he is attending college, and if the intention was with him to remain in that place, although he might be a student there, he would have a right notwithstanding the insertion of this clause to vote there.” Mr. Justice Rtoisey took a similar position. (Debates, Constitutional Convention, p. 569.) The Convention accepted the purpose and meaning of this provision as stated in these views and inserted that provision in the Constitution with the construction given by these eminent members. (Matter of Ward, 29 Abb. N. C. 187.)

The Constitution provides that For the purpose of voting, no person shall be deemed to have gained or lost a residence, by reason of his presence or absence, * * * while a student of any seminary of learning * * The Election Law, in so far as pertinent, contains the same language. These provisions eliminate presence at an institution of learning as evidence of intention to change a voting domicile. We must find other acts which are independent of the student’s presence at the seminary.

“ The intention to change is not alone sufficient. It must exist, but must concur with and be manifested by resultant acts which are independent of the presence as a student in the new locality.” (Matter of Goodman, 146 N. Y. 284, 288.)

The courts in this State have taken the unequivocal position that even a full time student may become entitled to vote where he has adopted the seminary of learning as his residence and has established his residence by acts or circumstances which are independent of his presence as a student in the locality. (Matter of Garvey, 147 N. Y. 117.) Judged by this test this petitioner clearly manifested his intention by acts which are independent of his presence as a student at the seminary.

This petitioner came to the United States with his parents in 1925. He was then eighteen years of age. A year later his parents migrated to South America, where they have since resided. In the year 1926, when his parents left, this petitioner took up his residence in the second election district of the thirteenth Assembly district in New York city where he has continually resided ever since. In 1933 he became naturalized as a citizen of the United States and at that time resided in a residence hall of Columbia University. In the case at bar the petitioner has taken up his residence to practice his profession of teaching and to earn his living as an employee of the city of New York. His work at Columbia University is limited to a single course in physics, which is incidental to Ms work as a teacher in Brooklyn College. He makes oath that he has with him all Ms personal property, and that he intends to remain indefinitely af Ms present address, where he maintains' Ms legal and permanent residence for all purposes.

The statement that the petitioner intends to remain indefinitely at Ms present address certainly amounts to a statement that he intends to reside indefinitely at that address in the election district. No question of transfer of residence from one election district to another arises in the case at bar. The petitioner has renounced Ms German citizensMp, and unless we hold that he has acquired a domicile at Ms present address he will be without a residence for voting purposes. All Ms acts show an intention to acquire such a residence in the city of New York, in his present election district, and at his present address.

In tMs case we do not have before us, as in the Blank-ford Case (241 N. Y. 180), a student at a seminary of learning entering a religious order for a course of study from two to six years. The petitioner has done all that is in his power to do in order to establish a voting domicile in New York city. The only reason for denyiqg him the right to vote is the fact that he studies a single course at Columbia University. To read the Constitution or the Election Law so as to deprive the scholar of the right to vote does not seem to me required either by the terms of the Constitution, or the applicable authorities.

It is true that in Matter of Garvey (147 N. Y. 117, 123) the court said: “ It may be urged that the enforcement of tMs rule will render it well nigh impossible for a student to establish a residence in a seminary of learning, but the very obvious answer is that the letter and spirit of the Constitution contemplate such a result; ” but in the same sentence it added the sojourn of the student is assumed to be temporary, and the law preserves to him Ms former residence, notwithstanding his absence therefrom.” In the case at bar it can no longer be assumed that the sojourn is intended to be temporary. Nor can it be said that the petitioner has retained his former residence or domicile in Germany.

It follows that the order of the Appellate Division should be reversed and the order of Special Term reinstated.

Crane, Ch. J. Lehman, O’Brien, Hubbs and Rippey, JJ., concur with Lotjghran, J.; Finch, J., dissents in opinion.

Order affirmed.


source: Caselaw Access Project

license: Public Domain

text:
    Edward A. Maher, 3d, et al., as Trustees under the Will of Frances G. Maher, Deceased, Appellants, v. Jane Randolph, Respondent.

      Argued May 26, 1937;
    decided July 13, 1937.

      C. Dickerman Williams, William Russell Bogert and Pearce H. E. Aul for appellants.
    The Statute of Frauds (Cons. Laws, ch. 41, § 85, subd. 1) is a rule of evidence enabling the suppression of proof of an oral contract. If there was proof of a contract before the court without proper objection by the defendant the judgment of the trial court should not be disturbed. Here the testimony by defendant herself, proving the contract, makes the statute irrelevant. (Hutchins v. Van Vechten, 140 N. Y. 115; McKenna v. Meehan, 248 N. Y. 206; 300 West End Ave. Corp. v. Warner, 250 N. Y. 221; Ford Motor Co. v. Hotel Woodward Co., 271 Fed. Rep. 625; Maddison v. Alderson, 8 App. Cas. 467; Morris v. Barron, [1918] App. Cas. 1; Crane v. Powell, 139 N. Y. 379; Wallace v. Dowling, 86 S. C. 307; Smith v. Brailsford, 1 Dess. Eq. 350; Degheri v. Carobine, 100 N. J. Eq. 493.) As the draperies were already in the possession of the defendant and as defendant. expressed by words her assent to becoming owner of the draperies, there was a part delivery taking the case out of the Statute of Frauds. (Wilson v. Hotchkiss, 171 Cal. 617; Devine v. Warner, 75 Conn. 375; Raldne

      Realty Co. v. Brooks, 281 Mass. 233; Harlan v. Carney, 219 Mich. 539; Kenesaw Mill Co. v. Aufdenkamp, 106 Neb. 246; Snider v. Thrall, 56 Wis. 674.)

      Louis Bevier for respondent.
    The admission by the defendant of the oral contract does not operate as a waiver by her of the protection of the Statute of Frauds and having pleaded it she may avail herself of it. (Cozine v. Graham, 2 Paige Ch. 177; Lord Constr. Co. v. Edison Portland Cement Co., 234 N. Y. 411.) The contract is unenforceable by reason of the Statute of Frauds. (Young v. Ingalsbe, 208 N. Y. 503; Cooke v. Millard, 65 N. Y. 352; Cross v. O’Donnell, 44 N. Y. 661; Dorsey v. Pike, 50 Hun, 534.)
   Loughran, J.

As owners of 240 shares of the stock of a corporation formed under a co-operative ownership plan, plaintiffs held a lease of an apartment in a building erected by the corporation. This apartment, with its furnishings, they let to the defendant for a term to expire on May 15, 1935. The furnishings included three pairs of draperies worth about $150.

On May 5, 1935, the parties entered into an oral agreement for sale by the plaintiffs and purchase by the defendant of the 240 shares of stock for $4,000. In the course of this transaction the defendant inquired whether the plaintiffs would consent to include the draperies in the sale,” and the plaintiffs answered: Very well, the draperies are yours.” Before the time fixed for delivery of the stock and for payment of the first installment of the purchase price the defendant withdrew from the transaction.

This is an action for breach of the contract of purchase and sale. The defense is the Statute of Frauds relating to personal property. A contract to sell or a sale of any goods or choses in action of the value of fifty dollars or upwards shall not be enforceable by action unless the buyer shall accept part of the goods or choses in action so contracted to be sold or sold, and actually receive the same, or give something in earnest to bind the contract, or in part payment, or unless some note or memorandum in writing of the contract or sale be signed by the party to be charged or his agent in that behalf.” (Pers. Prop. Law [Cons. Laws, ch. 41], § 85, subd. 1.) The question is whether there was such an acceptance and actual receipt of the curtains by the defendant as to make the contract enforceable.

The acceptance and receipt are both necessary. The contract is not valid unless the buyer does both. These are two distinct things. There may be an actual receipt without an acceptance, and an acceptance without a receipt. The receipt of the goods is bhe act of taking possession of them.” (Cooke v. Millard, 65 N. Y. 352, 367, 368.) Prior to the enactment in 1911 of section 85 of the Personal Property Law as part of the Uniform Sales Act, it was settled for us that the mere words of the bargain are not sufficient evidence to satisfy the statute in a case where the buyer already has possession of the goods under some prior and independent transaction of the parties. (Young v. Ingalsbe, 208 N. Y. 503. See Matter of Hoover, 33 Hun, 553; Dorsey v. Pike, 50 Hun, 534.) Such is this case.

Plaintiffs contend that the law was changed by subdivision 3 of section 85. It is thereby provided: “ There is an acceptance of goods within the meaning of this section when the buyer, either before or after delivery of the goods, expresses by words or conduct his assent to becoming the owner of those specific goods.” The argument of the plaintiffs, as we understand it, is that acceptance by a buyer in independent possession includes an actual receipt; that an acceptance may now be evidenced by words without an act; and that, therefore, such a transaction, though resting in words alone, is no longer condemned by the statute.

Concededly this construction of section 85 cannot here be adopted consistently with the reasoning of the opinion of this court in a case which was the source of the decisions last cited. What was said in that case is no less true in the case in hand. The declarations relied upon as evidence of a delivery and acceptance constitute a part of the contract, and of course are obnoxious to all the evils and^every objection against which it was the policy of the law to provide.” (Shindler v. Houston, 1 N. Y. 261, 264.) The validity of this view of the statute, as we are aware, has been doubted and denied. But with the policy of the law as there declared in 1848 the Legislature did not see fit to interfere prior to the enactment of the foregoing subdivision 3 of section 85 of the Personal Property Law in 1911. Under the circumstances we cannot find in section 85 a sufficient expression of intention to overturn so long and so settled a CQurse of decision.

The judgment should be affirmed, with costs.

Finch, J.

(dissenting). We are no longer bound by Young v. Ingalsbe (208 N. Y. 503). The rule enunciated therein has been the subject of much criticism and is contrary to the great weight of authority. (Williston on Contracts [Rev. ed.], § 554; American Law Institute, Restatement of the Law of Contracts, § 202; Burdick, A Statute for Promoting Fraud, 16 Col. Law Rev. 273.) In 1911 New York adopted the Uniform Sales Act which, in subdivision 3 of section 85 (Personal Property Law; Cons. Laws, ch. 41), provides that “ There is an acceptance of goods within the meaning of this section when the buyer, either before or after delivery of the goods, expresses by words or conduct his assent to becoming the owner of those specific goods.” Most of the other States which have adopted the Uniform Sales Act construe this to mean that where goods are already in possession of the buyer, acceptance may be evidenced by words. (Williston, op. cit. supra, § 557.) The statute having been amended, we are no longer bound by the earlier cases and, especially in view of our adoption of the Uniform Statute, no valid reason appears for continuing to follow a rule which seems to be counter to the new statute and is out of harmony with the rule generally adopted.

The judgment of the Appellate Division should be reversed, and the judgment of the Trial Term reinstated, with costs.

Crane, Ch. J., Lehman, O’Brien, Hubbs and Rippey, JJ., concur with Loughran, J.; Finch, J., dissents in opinion.

Judgment affirmed.


author: Crane, Ch. J.

text:
    Johanna C. De Ryss, as Administratrix of the Estate of Emil De Ryss, Deceased, Respondent, v. New York Central Railroad Company et al., Appellants, Impleaded with Another.

      Argued May 27, 1937;
    decided July 13, 1937.

      Kenneth O. Mott-Smith and Clive C. Handy for New York Central Railroad Company, appellant.
    Since the railroad had entered into no relationship with either Jerick or the decedent, it owed no duty to the latter to control the act of the former. (Ford v. Grand Union Co., 268 N. Y. 243; Goldberg v. Borden’s Condensed Milk Co., 227 N. Y. 465; Rolfe v. Hewitt, 227 N. Y. 486.) Since the employee’s failure to control Jerick’s act was outside the scope of bis employment, the railroad is not liable for the consequences. (Ford v. Grand Union Co., 268 N. Y. 243; Smith v. N. Y. C. & H. R. R. R. Co., 78 Hun, 524; Corrigan v. Bobbs-Merrill Co., 228 N. Y. 58; American Nat. Bank v. Miller, 229 U. S. 517; Limpus v. General Omnibus Co., [1867] 1 H. & C. 526.)

      Kenneth O. Mott-Smith and Clive C. Handy for Joseph M. Hard, appellant.
    The employee violated no duty which he owed to decedent by permitting Jerick to shoot at ducks from the railroad property. (Palsgraf v. Long Island R. R. Co., 248 N. Y. 339; Schlenger v. Weinberg, 107 N. J. L. 130; Gleason v. Hillcrest Golf Course, Inc., 148 Misc. Rep. 246; Simpson v. Fiero, 237 App. Div. 62; Povanda v. Powers, 152 Misc. Rep. 75; Toohey v. Webster, 97 N. J. L. 545; Alexander v. Wrenn, 158 Va. 486.)

      Arthur T. Schmidt and Alfred M. Bailey for respondent.
    The defendant railroad had a non-delegable duty to use its fixed property in such a way so as not to cause injury to the public on adjoining property. (Palsgraf v. Long Island R. R. Co., 248 N. Y. 339; Quarman v. Burnett, 6 Mees. & W. 499; Gardner v. Heartt, 2 Barb. 165; Althorf v. Wolfe, 22 N. Y. 355; Appel v. Muller, 262 N. Y. 278; Sullivan v. Dunham, 161 N. Y. 290; Fletcher v. Baltimore & Potomac R. R. Co., 168 U. S. 135; Flike v. Boston & Albany R. R. Co., 53 N. Y. 549; Jennings v. Van Schaick, 108 N. Y. 530; Riegler v. Tribune Assn., 40 App. Div. 324; 167 N. Y. 542; Chapman v. N. Y. C. R. R. Co., 33 N. Y. 369; Hogle v. Franklin Mfg. Co., 199 N. Y. 388; Rounds v. D., L. & W. R. R. Co., 64 N. Y. 129; Ford v. Gr.and Union Co., 268 N. Y. 243; Ehret v. Village of Scarsdale, 269 N. Y. 198.) At the conclusion of the case no motion by the appellant railroad company was made for the dismissal of the complaint and, therefore, it admitted not only by the stipulation that there were questions of fact to be presented to the jury but by such failure to move for a dismissal of the complaint further conceded that there were questions of fact involved for submission to the jury. (Atkinson v. Sanders, 250 N. Y. 170; Murtha v. Ridley, 232 N. Y. 488.) The Appellate Division judgment was proper. (Althorf v. Wolfe, 22 N. Y. 355; Grant v. Knepper, 245 N. Y. 158; Fletcher v. B. & P. R. R. Co., 168 U. S. 135; Williams v. Koehler, 41 App. Div. 426; Salisbury v. Erie R. R., 66 N. J. L. 233.) The verdict against the employee was justified by the facts and the law. (Suydam v. Moore, 8 Barb. 358; Fedden v. Brooklyn Eastern Dist. Term., 204 App. Div. 741; Hankins v. Watkins, 77 Hun, 360; McCleary v. Frantz, 160 Penn. St. 535; Harper v. Holcomb, 146 Wis. 183; Castle v. Duryea, 1 Abb. Dec. 327; McRichard v. Flint, 114 N. Y. 222.)
   Crane, Ch. J.

On October 18, 1933, the defendant The New York Central Railroad Company owned and controlled a certain railroad extending through the village of Ossining, county of Westchester and State of New York, and owned and controlled the signal towers and signal bridges located thereon. The said railroad runs parallel with the Hudson river at said point in a northerly and southerly direction and to the east of the river. West of the said railroad line operated by the defendant The New York Central Railroad Company at the point involved in this action is a sand bar owned by one Patterson, and in no way connected or controlled by the railroad, being abutting property thereto. This sand bar is a flat, smooth bar which at high tide is partially below the water and at low tide is partially exposed and has only a few tufts of grass growing on the same. At a point approximately opposite this sand bar, the defendant The New York Central Railroad Company maintained, operated and controlled a signal bridge, being a structure about sixty feet high and extending over the six tracks of the railroad and having four poles on the top thereof for semaphore signals.

On October 18,1933, plaintiff’s intestate, Emil De Ryss, accompanied by a neighbor and friend, Robert C. Walker, went duck hunting on the same bar above described and built a blind from which to shoot ducks on the Hudson river. This blind was built on private property abutting that owned by the railroad. They placed decoys in the river and sat in the blind waiting for ducks. The blind was approximately thirty inches high, conspicuous in structure and so constructed that the bodies of the occupants could be seen from their waist up. The blind was somewhere between 600 and 800 feet distant from the signal bridge of the defendant The New York Central Railroad Company.

On the signal bridge of the defendant The New York Central Railroad Company was working the defendant Joseph M. Hard,' an employee of the defendant The New York Central Railroad Company. He was a signal maintainer for the said railroad, having charge of or control of approximately eleven bridges in this section. While he was working on the said signal bridge, the defendant Andrew Jerick, who was not an employee of the said railroad, was present on the railroad property at the foot of the signal bridge and had with him a twenty-two calibre rifle. The defendant Joseph M. Hard, the signal maintainer, called to the defendant Andrew Jerick to the effect that there were some ducks out in the river, whereupon the defendant Andrew Jerick climbed up the ladder to the signal bridge. In attempting to shoot the dueles the defendant Andrew Jerick fired the rifle from the signal bridge and killed plaintiff’s intestate, Emil De Ryss, while he was sitting in the blind constructed by him and Robert C. Walker.

Rules of the railroad include the following: “ Trespassing on property of the company is prohibited and reasonable means must be used to prevent it.”

There were further rules known as safety rules, which provide as follows:

Safety is of the first importance in the discharge of duty.”
“ Employees must refrain from improper practices and should also caution other employees to use care and not deviate from the spirit of these rules, pointing out to them the risk of injury to themselves or others, or damage to property.”
The rules contained herein are issued for the purpose of insuring greater personal protection to passengers, employees and the public.
The necessity for care must be kept in mind at all times as the rules contained herein may not cover all practices essential to safety.”

A judgment of $59,917.55 has been obtained against the railroad company because a stranger attempted to shoot ducks while standing on its right-of-way.

The trial judge submitted four questions to the jury which were answered in plaintiff’s favor. The judge, however, dismissed the complaint as to the corporate defendant and directed judgment against the employee, Joseph M. Hard. On appeal the Appellate Division reversed the trial judge and directed a verdict against the railroad. We must reinstate the finding of the trial court as we can discover no basis for the railroad’s liability.

As the owner of its real estate and right-of-way, the railroad was under no greater duty than any other owners of property, except as to certain obligations imposed by statutes, such as keeping the grass and shrubbery cut, maintaining or protecting crossings and the like, and guarding against the movement of its trains. No greater liability was imposed upon it than upon other owners of real estate for the acts of trespassers causing injury to outsiders not passengers or invitees. Care commensurate with the known danger is the duty of every owner of real property. Thus if the railroad authorities knew that persons were in the habit of shooting guns from its bridges or signal towers, ordinary caution would have required the company to take measures to stop it; such practice continued after knowledge of its existence and an opportunity to end it would make the company liable. This was the case of Fletcher v. Baltimore & Potomac R. R. Co. (168 U. S. 135), cited on the respondent’s brief. The railroad company permitted its men to carry timber on flat cars for their individual use as firewood, and knew that it was the constant habit of the men to throw off these pieces of firewood while the train was in motion at such points on the road as were nearest to their homes. O; e such piece of timber struck the plaintiff, who was waiting on the pavement alongside of the track for the train to pass. It was the practice and the custom which brought home notice to the railroad of the danger.

But no such consequences follow from a single act of trespass. Nor does the invitation of the employee to the stranger to come on the property make his act that of his employer. He was not employed to invite trespassers but to keep them off. When Hard suggested . that Jerick come up on the signal bridge he was acting without the scope of his employment, not within it. True it is that continued acts of trespass committed with the knowledge of employees may be evidence of notice to the railroad company or any other employer — usage many times implies knowledge; but when the one who is to protect property departs from his duty, betrays his trust and encourages or acquiesces in the trespass, his acts or omissions cannot constitute notice to the master. (Ford v. Grand Union Co., 268 N. Y. 243.) Facts which come to the notice of any employee in the course of and in the pursuit of his employment may be and usually are notice to, or knowledge of the employer (Corrigan v. Bobbs-Merrill Co., 228 N. Y. 58, 69), but such inference disappears when the employee departs from his duty and acts for himself and not his employer. We are here dealing with duties which may be delegated to others.. There are some obligations imposed by statutes or ordinances and some care of passengers and invitees which cannot be delegated, and for any violation of these the master or employer cannot plead ignorance or the failure of the servant to perform, or even the willful neglect or disobedience of the one intrusted with the duty. The protection of the general public from the acts of trespassers is not one of these non-delegable ” duties. If we shift the scene to a man’s home or farm we grasp the point at once. Going away for a spell, a man desires to close his home or farmhouse and to have it protected from marauders and trespassers in his absence. He employs a watchman for the purpose, with instructions to keep out all intruders. Instead of obeying instructions the watchman invites a friend to bring over his shotgun and shoot for pleasure from the front porch or the grounds. Could a person on the highway or on adjoining property who was injured recover from the owner for the act? The watchman and the shooter might be liable, but not the owner. His rules and instructions, like those of the railroad in this case, were made for his advantage, not disadvantage; the injured person could not claim that the watchman was negligent because he had violated his employer’s instructions to permit no trespassing. The plaintiff in this case cannot predicate the company’s liability on a violation of its own rules against trespassers; these were made for its protection not to give the right of recovery to strangers; to define the duties of employees, not to increase the company’s liability. If no liability existed in the absence of these rules, surely none was created by the caution which prompted them. These few fundamental common-law principles of master and servant may be found in sections 315, 318 and 348 of the Bestatement of the Law of Torts (American Law Institute).

As to the appellant Joseph M. Hard a different rule of law applies. His liability is not predicated upon any failure to perform his duty as an employee of the railroad company. The court so charged the jury. The judge said: “It is true that Mr. Hard was supposed and directed to expel trespassers on railroad property from the railroad property. Failure to do that, in and of itself would not be an act of negligence. The question of negligence here is, as to whether or not he, under the circumstances, should have controlled the actions of Mr. Jerick. * * * Whether he, under those circumstances, should in the exercise of reasonable care have anticipated that Mr. Jerick, by shooting that gun, was exposing others to an unreasonable risk of bodily harm.”

The court stated the rule of law to be this: “ If one in possession of land permits a third person to so conduct himself on his land as to create an unreasonable risk of bodily harm to others, then there would be liability, provided that the one in possession of the land knew or had reason to know that he had ability to control the actions of the third person, and, provided also that he knew or should know of the necessity and the opportunity for exercising such control.”

Whether or not the blind in which Mr. De Ryss was hiding was exposed to the view of Hard and Jerick was a contested question of fact. The plaintiff’s evidence, if believed, would indicate that De Ryss could be seen and that it was negligence to shoot in his direction. If Hard, having control of the premises and the situation, not only permitted, but invited Jerick to shoot at ducks in the river under circumstances and conditions which would indicate to a reasonably prudent man that it was dangerous to others so to do, he would be liable with Jerick for the consequences. One who permits a hunter to shoot on his property is not liable for the carelessness and negligence of the hunter, if there be nothing to indicate that shooting on his property might or would be dangerous to others. If, however, permission has been given under circumstances which would lead a reasonable man to believe that hunting on the property might be dangerous to passers-by or to neighbors, then a different question arises ■— a question whether reasonable care had been exercised in giving such permission.

The question has been raised by the respondent as to the practice, stating that no motion was made by the attorney for the railroad company for a dismissal at the end of the case. Such a motion was made at the end of the plaintiff’s case, and the court reserved decision. At the end of the entire case motions were renewed and the court again reserved decision. The only decision made, so far as the record shows, appears in the clerk’s minutes and the judgment as entered. The judgment recites: “ and it being stipulated by and between the attorneys for the respective parties that the Court reserve decision on the motions of the defendants, The New York Central Railroad Company and Joseph M. Hard, for a dismissal of the complaint, * * * and the Court having directed a verdict in favor of the plaintiff against the defendants, Andrew Jerick and Joseph M. Hard for the sum of $50,000, with interest thereon from the date of death, and in favor of the defendant, The New York Central Bailroad Company, for no cause of action, * *

The ruling on these motions to dismiss the complaint, having been reserved in this fashion, the defendant never had an opportunity to except to any ruling before the case went to the jury. This, however, does not prevent a review of the question by this court. (Civ. Prac. Act, § 583, subd. 2.)

The judgment of the Appellate Division as to the defendant New York Central Bailroad Company should be reversed and that of the Trial Term affirmed, with costs in this court and in the Appellate Division, otherwise the judgment should be affirmed, with costs.

Lehman, O’Brien, Hubbs, Loughran, Finch and Bippey, JJ., concur.

Judgment accordingly.


author: Rippey, J.

text:
    John Shannon, Appellant, v. Irving Trust Company, as Trustee, et al., Respondents.

      Argued May 25, 1937;
    decided July 13, 1937.

      G. Gilbert Palmer for appellant.
    A trust of personal property is governed by the law of the State where the property and the trustee are located and the trust is to be administered. (Hutchison v. Ross, 262 N. Y. 381; Ross v. Ross, 233 App. Div. 626; Chamberlain v. Chamberlain, 43 N. Y. 424; Hope v. Brewer, 136 N. Y. 126; Curtis v. Curtis, 185 App. Div. 391; Peabody v. Kent, 153 App. Div. 286; 213 N. Y. 154; Mount v. Tuttle, 183 N. Y. 358; Fordyce v. Bridges, 2 Phil. 497; Van Grutten v. Digby,
      31 Beav. 561; Matter of Fitzgerald, 1 Ch. 933.) The New York statutes regarding accumulations are an expression of the public policy of the State concerning the holding of property within this State; the reference in the indenture to the laws of New Jersey cannot make the accumulations valid in contravention of that public policy. (Carrier v. Carrier, 226 N. Y. 114; Church v. Wilson, 152 App. Div. 844; 209 N. Y. 553; Cope v. Wheeler, 41 N. Y. 303; New York Life Ins. Co. v. Cravens, 178 U. S. 389; Wilmington Trust Co. v. Wilmington Trust Co., 186 Atl. Rep. 903; Morris v. Morris, 272 N. Y. 110; Hutchison v. Ross, 262 N. Y. 381.) Plaintiff is entitled to the amounts already accumulated, for he is the party presumptively entitled to the next eventual estate. (Cons. Laws, ch. 50, § 63; Cons. Laws, ch. 41, § 11; Cook v. Lowry, 95 N. Y. 103; Manice v. Manice, 43 N. Y. 303; Bloodgood v. Lewis, 146 App. Div. 86; 209 N. Y. 95; Central Union Trust Co. v. Trimble, 255 N. Y. 88; Pray v. Hegeman, 92 N. Y. 508.)

      Herbert P. Carter and Howard Carter for Irving Trust Company et al., respondents.
    The accumulation, provisions are valid according to the law of New Jersey, where the settlor is domiciled and whose law the parties declared shall govern. (Croker v. Croker, 252 N. Y. 24; Hanna v. Stedman, 230 N. Y. 326; First Camden Nat. Bank & Trust Co. v. Collins, 114 N. J. Eq. 59; Van Riper v. Hilton, 78 N. J. Eq. 371; Hewitt v. Green, 77 N. J. Eq. 345; Townsend v. Allen, 36 N. Y. St. Repr. 523; 126 N. Y. 646.) The law of the settlor’s domicile may be applied to sustain the provisions of a trust of personal property. (Townsend v. Allen, 36 N. Y. St. Repr. 523; 126 N. Y. 646; Parsons v. Lyman, 20 N. Y. 103; Cross v. United States Trust Co., 131 N. Y. 330; Dammert v. Osborn, 140 N. Y. 30; Bishop v. Bishop, 257 N. Y. 40; Sullivan v. Babcock, 63 How. Pr. 120; Maynard v. Farmers Loan & Trust Co., 208 App. Div. 112; 238 N. Y. 592; Equitable Trust Co. v. Pratt, 117 Misc. Rep. 708; 206 App. Div. 689; Curtis v. Curtis, 185 App. Div. 391; Morris v. Sheehan, 112 Misc. Rep. 222.) The intention of the parties should be sustained whenever possible. (Gilbert v. Burnstine, 255 N. Y. 348.) There is no lack of uniformity or certainty in testing trusts of personalty by the law of the domicile in some circumstances and by the law of the situs in other circumstances. (Matter of Tinker, 124 Misc. Rep. 723; Matter of Froment, 135 Misc. Rep. 483; Chamberlain v. Chamberlain, 43 N. Y. 424; Cross v. United States Trust Co., 131 N. Y. 330.) To uphold a trust valid by the law of the settlor’s domicile does not violate the public policy of the State of New York. (Dammert v. Osborn, 140 N. Y. 30; Cross v. United States Trust Co., 131 N. Y. 330; Hollis v. Drew Theological Seminary, 95 N. Y. 166; Mertz v. Mertz, 271 N. Y. 466.)

      Francis J. Rogers and Mark W. Maclay for The Hill School, respondent.
    The law of New York will recognize and give effect to the expressed intent of the grantor to have the trust indenture construed in accordance with the law of New Jersey. (Dammert v. Osborn, 140 N. Y. 30; Cross v. United States Trust Co., 131 N. Y. 330; Bishop v. Bishop, 257 N. Y. 40; Equitable Trust Co. v. Pratt, 117 Misc. Rep. 708; 206 App. Div. 689; Liberty Nat. Bank & Trust Co. v. New England Investors Shares, 25 Fed. Rep. [2d] 493; Hutchison v. Ross, 262 N. Y. 381.) It will not violate the public policy of the State of New York to have the trust indenture construed in accordance with the laws of New Jersey. (Hollis v. Drew Theological Seminary, 95 N. Y. 166; Cross v. United States Trust Co., 131 N. Y. 330.)

      Richard S. Emmet and John L. Merrill, Jr.,

    for Bank of New York and Trust Company, amicus curiœ. The validity of the trust depends solely upon the public policy of this State. (Hutchison v. Ross, 262 N. Y. 381.) Foreign settlors may act here in reliance on their domiciliary law. (Townsend v. Allen, 13 N. Y. Supp. 73; 126 N. Y. 646; Cross v. United States Trust Co., 131 N.Y. 330.)

      Thomas A. Ryan and William Parsons

    for Milbank, Tweed, Hope & Webb, amicus curiæ. New York will give effect to the intention of a creator of a trust that the law of his domicile or the law of the situs of the trust should govern its validity. (Holmes v. Remsen, 4 Johns. Ch. 460; Sullivan v. Babcock, 63 How. Pr. 120; Townsend v. Allen, 59 Hun, 622; 126 N. Y. 646; Maynard v. Farmers Loan & Trust Co., 208 App. Div. 112; 238 N. Y. 592; Equitable Trust Co. v. Pratt, 117 Mise Rep. 708; 206 App. Div. 689; Curtis v. Curtis, 185 App. Div. 391; Swetland v. Swetland, 105 N. J. Eq. 608; 107 N. J. Eq. 504; Greenough v. Osgood, 235 Mass. 235; Liberty Nat. Bank & Trust Co. v. New England Investors Shares, 25 Fed. Rep. [2d] 493; Cross v. United States Trust Co., 131 N. Y. 330; Dammert v. Osborn, 140 N. Y. 30; Bishop v. Bishop, 257 N. Y. 40; Hutchison v. Ross, 262 N. Y. 381.) To uphold the validity of the trust would not contravene the public policy of this State. (Dammert v. Osborn, 140 N. Y. 30; Cross v. United States Trust Co., 131 N. Y. 330; Bishop v. Bishop, 257 N. Y. 40; Hollis v. Drew Theological Seminary, 95 N. Y. 166.)
   Rippey, J.

On December 13, 1929, a trust indenture was duly executed in the city of New York between Joseph G. Shannon, who was then a resident of Jersey City and domiciled within the State of New Jersey, and the Irving Trust Company, a corporation organized and existing under the laws of the State of New York with its principal office at 233 Broadway, New York city, as trustee, whereby an irrevocable trust was created for the benefit, among others, of Goewey F. Shannon, wife of the settlor, and plaintiff herein, John Shannon, the son of the settlor, both of which beneficiaries were then residents of and domiciled within the State of New Jersey. At the same time, the settlor delivered to the trustee various stocks, funds, securities and properties set forth in a schedule annexed to the instrument. Thereupon the trustee entered upon the administration of the trust at its office in the city of New York and has continued to administer it to the time of the commencement of this action. The trust created for the wife consisted of fixed items of income with the provision that all income in excess of the amount named should accumulate and become part of the principal of the trust. Up to December 26, 1933, when Goewey F. Shannon died, she continued to be a resident of and domiciled within the State of New Jersey and her sole heirs at law and next of kin, both under the laws of New Jersey and of New York, were her husband and son aforesaid. The trust instrument provided that upon her death the trustee should thereafter pay to the son, John Shannon, monthly, an aggregate annual income of $3,000 until the son should arrive at twenty-five years of age; that thereafter the income to the son, payable in monthly installments, should aggregate $5,000 per year until the son arrived at the age of thirty years; that thereafter the income to. the son should be increased to $10,000 per year until he should arrive at the age of thirty-five years, after which time he should receive the full income from the trust estate for the balance of his life. All income in excess of the amounts thus payable to the son was directed to become a part of the trust estate. The trust instrument provided that, at the death of the son, the principal and accumulated income should pass to the issue of the son or, if the son should die without issue surviving, to the Hill School of Pottstown, Pa. At the time the trust was created, the plaintiff was a resident of and domiciled within the State of New Jersey and his domicile has continued in that State to the time of the commencement of the action. There accumulated in the hands of the trustee income in excess of the amount paid to the wife according to the terms of the trust in the sum of $6,370.16, and the sum of $10,608.72 in excess of the income paid to the son since the death of the wife. Other provisions of the trust instrument are not material, except the last clause, which reads as follows: “ The Trustee shall receive for its services, its necessary expenses and the commissions allowed testamentary trustees by the laws of the State of New York instead of the laws of the State of New Jersey, but otherwise the laws of the State of New Jersey shall govern this trust indenture and any construction to be placed thereupon or interpretation thereof.”

Upon submission to the Appellate Division in the first department pursuant to sections 546-548 of the Civil Practice Act, the plaintiff contended that the validity of the trust is to be determined by the laws of the State of New York and, inasmuch as the provisions for accumulations of income are void under section 16 of the Personal Property Law (Cons. Laws, ch. 41) of the State of New York (Laws of 1909, ch. 45), the accumulations should be paid over to him as the person presumptively entitled to the next eventual estate (St. John v. Andrews Institute for Girls, 191 N. Y. 254), while the defendants assert that the validity of the trust provisions is to be determined by the laws of the State of New Jersey, where the accumulations are valid. (Townsend v. Allen, 59 Hun, 622; affd., 126 N. Y. 646.) The Appellate Division found that the trust was valid and certified to this court that a question of law was involved which ought to be here reviewed.

Much confusion has existed concerning the law that controls the validity and administration of inter vivas trusts of intangible personal property where the domicile of the settlor is in one State and the situs and place of administration is in another. No invariable rule can be formulated for all cases involving varying facts. The domicile of the settlor is no longer the absolute and controlling consideration (Hutchison v. Ross, 262 N. Y. 381; Matter of Brown, 274 N. Y. 10). Where the domicile of the owner of the res and the actual and business situs of the trust do not coincide, the law applicable to the interpretation, construction and validity of the trust and the legal obligations arising out of it and to taxation depend upon facts involved in and circumstances surrounding the particular case. In such a situation, the express or clearly implied intent of the settlor may control. Thus, where the actual and business situs of the trust, intent of the settlor that his domiciliary law shall not be applied to test its validity and administration, and domicile of the trustee coincide, the law of the place of location and administration of the trust controls, regardless of the place of execution of the trust instrument. (Hutchison v. Ross, supra.)

In the case at bar the execution of the trust instrument, the location of the res, the domicile of the trustee and the place of administration of the trust are in the city of New York. The intent of the settlor that in all matters affecting the trust except remuneration of the trustee his domiciliary law shall govern is expressly stated in the body of the trust instrument. The intent is manifest; no uncertainty exists. The instrument should be construed and a determination of its validity made according to the law chosen by the settlor unless so to do is contrary to the public policy of this State.

It is unnecessary to enter into any extensive consideration of what is meant by the term public policy of the State. Its limitations and extent under varying conditions in connection with enforcement here of foreign law have been fully considered by this court. (Cross v. United States Trust Co., 131 N. Y. 330; Loucks v. Standard Oil Co., 224 N. Y. 99; Mertz v. Mertz, 271 N. Y. 466; Hutchison v. Ross, supra, and antecedent decisions therein cited.) It has been held that a State can have no public policy except when it is to be found in its Constitution, statutes or judicial records. If our public policy is clearly defined in our Constitution or statutes, it must invariably control judicial decision. If not found in the Constitution or statutes of the State, it may be established by judicial decision. If guidance is still lacking, to enforce the laws of a sister State is not contrary to our public policy unless to do so would be manifestly injurious to the public interest or shocking to our morals or contrary to fundamental principles of justice or “ deep rooted traditions of the common weal.” (Hollis v. Drew Theological Seminary, 95 N. Y. 166.)

It is stipulated in this case that accumulation of income and addition thereof to the corpus of a trust are valid under the laws of the State of New Jersey. In McGill v. Trust Co. of New Jersey (94 N. J. Eq. 657) it is said: “ The rule against perpetuities is in force in this state as a part of the common law [citing cases]. That rule requires that all future interests, legal or equitable, in realty (except dower and curtesy and rights of entry for conditions broken) or personalty, which are contingent and indestructible, must be such as necessarily to vest, if at all, within the term measured by the life or lives of a person or persons in being at the time of the creation of the interest and twenty-one years thereafter; otherwise they are invalid and void ” (p. 664). Under that rule, the trust as to the corpus of the estate is valid. All accumulations of income in excess of the amounts specifically directed to be paid to plaintiff and his mother become a part of and pass with the corpus and are in aid of the ultimate gift. Inasmuch as the ultimate gift of the corpus is valid as vesting within the period of a life or lives in being at the date of the creation of the trust and twenty-one years, the provision for the accumulations of excess income is not void. (Van Riper v. Hilton, 78 N. J. Eq. 371.)

Consideration of the New Jersey law and our own relating to perpetuities and accumulations of income will indicate that our policy in that connection is substantially the same as that of New Jersey. This fact has been made clear when our law and that of other sister States have been involved. In Cross v. United States Trust Co. (supra), one Phoebe Jane Cross, whose residence and domicile were in the State of Rhode Island, died in New York city leaving a will executed in the State of New York and dated May 29, 1877, in which she created a trust of personal property for the benefit of her husband and each of her four children, with the United States Trust Company, a New York corporation, as trustee. The trust was invalid under the laws of New York at the domicile of the beneficiaries and trustees where it was to be administered, as “ within the statutory prohibition against the suspension of the absolute ownership and power of disposition of personal property ” (p. 337), but valid under the laws of the settlor’s domicile when the will was made. Rhode Island had a statute in respect to perpetuities. In that case the court said: The' only material difference in the law of the two states on this subject is that in each a different rule is adopted for measuring the period within which absolute ownership may lawfully be suspended ” (p. 342). It does not follow that a trust created by the laws of another state is contrary to our public policy with respect to accumulations and the suspension of the absolute ownership, simply because the law of that state differs in some respects from ours. ■ It may be assumed that all our sister states have enacted laws on this subject having the same general purpose in view as our own. Some of them permit a longer and others provide for a shorter period of suspension, but the policy of all is the same ” (pp. 341, 342). To like effect are the decisions in Chamberlain v. Chamberlain (43 N. Y. 424) and Dammert v. Osborn (140 N. Y. 30), and see Hollis v. Drew Theological Seminary (supra). There can be no valid distinction raised between testamentary trusts and trusts inter vivas so far as questions of public policy are concerned. The general policy of New Jersey and New York to put some limitation on the absolute suspension of the power of alienation of property and the accumulation of income from trusts is the same. Difference arises only as to the ending of the period during which such power to suspend alienation and to provide for accumulation of income may be permitted.

Under the facts existing in the case at bar, after applying the tests above indicated, we find nothing in our public policy which forbids extending comity and applying the New Jersey law so as to carry out the wish of the settlor and sustain the trust. The positive direction contained in the trust instrument that the validity of the trust should be determined by the law of the settlor’s domicile must prevail. Our decision here does not extend, however, beyond instances where conflict arises between the domiciliary law of the settlor and the law of the situs of the trust where the construction and validity of trusts inter vivas are involved.

The judgment should be affirmed, with costs.

Crane, Ch. J., Lehman, O’Brien, Htibbs, Loughran and Finch, JJ., concur.

Judgment affirmed.


text:
    Edwin B. Moore, Appellant, v. United States Cremation Company, Ltd., Respondent.

      Argued May 25, 1937;
    decided July 13, 1937.

      Frederick C. Dowd for appellant.
    The Legislature has recognized the burial of cremated remains as a cemetery purpose. (Cons. Laws, ch. 35, art. 9, § 70.) There is no implied repeal of laws requiring consent to acquire land under the provisions of subdivision 5 of section 76 of the Membership Corporations Law for a crematory and columbarium. (Cons. Laws, ch. 50, § 451; Matter of Cram, 69 N. Y. 452; Czarnowsky v. City of Rochester, 55 App. Div. 388.) The business of the defendant at the place acquired is forbidden by law. (Reg. v. Price, 12 Q. B. Div. 247; Cons. Laws, ch. 35, § 70; Abbey Land Co. v. San Mateo County, 167 Cal. 434.)

      David Holman and Jacob J. Pincus for respondent.
    The appellant failed to prove facts sufficient to constitute a cause of action. (James v. Alderton Dock Works, 256 N. Y. 298; Westchester Mortgage Co. v. Grand Rapids & I. R. R. Co., 246 N. Y. 194; Neubeck v. McDonald, 128 Misc. Rep. 768; Trustees of Columbia University v.
      Kalvin, 226 App. Div. 775; Loesch v. Manhattan Life Ins. Co., 128 Misc. Rep. 232.) The Legislature did not intend to include crematories in sections 73 and 78 of the Membership Corporations Law. (Moritz v. United Brethren Church, 269 N. Y. 125; Wojtkowiak v. Evangelical Lutheran St. John’s Church, 236 App. Div. 411; 261 N. Y. 656; Sharkey v. Thurston, 268 N. Y. 123; Burke v. New York University, 196 App. Div. 491.)
   Crane, Ch. J.

The following statements of fact were found by the trial court: The defendant United States Cremation Company, Ltd., is a domestic stock corporation organized in 1884 under the General Business Law (Cons. Laws, ch. 20). Among the powers granted by its certificate of incorporation is the right to cremate dead human bodies and to conduct a crematory and columbarium. The defendant has operated a crematory at Fresh Pond in Queens county since 1884. It now is in the process of establishing and erecting a crematory in Nassau county. It is the owner of approximately twenty-seven acres of land located in Central Park (now called Bethpage), town of Oyster Bay, Nassau county. Edwin C. Moore is the owner of approximately forty-five acres of land which adjoins that of the defendant on the west. The land of both parties fronts on the south side of the Hempstead-Farmingdale turnpike, which leads to Pinelawn Cemetery, about three miles east. This land of the defendant is located in the district defined by the zoning ordinance of the town of Oyster Bay as a Business H District, and was so placed in a resolution of the town board of the town of Oyster Bay on May 28, 1934, after due notice and hearing. Among the uses permitted in Business H District is that of a crematory and mortuary. On June 6, 1934, a permit was issued by the duly authorized official of the town of Oyster Bay, to wit, the building inspector, to erect and operate a crematory; and immediately thereafter the defendant entered into a contract for the erection and completion of its crematory except for the retorts. Work was commenced the same day the permit was issued.

On the 17th day of August, 1934, one Michael J. Leonard, a resident taxpayer of the town of Oyster Bay, instituted a mandamus suit in the Supreme Court to compel the town board to revoke the building permit and to compel the said town board to set aside the resolution which placed the land in a Business H District. The application for the mandamus was denied all the way through to the Court of Appeals. This suit related solely to the zoning resolution, no point being raised as to the State statute prohibiting the erection of crematories.

On June 6, 1935, one year after the issuance of the building permit, and after the defendant had completed the entire foundation work of the crematory and columbarium, this action was commenced by the adjoining landowner for a declaratory judgment setting forth the rights of the respective parties, and to have it declared that, pursuant to section 78 of the Membership Corporations Law (Cons. Laws, ch. 35), the defendant has no right to erect or maintain a crematory.

Further facts regarding the nature of this building which the defendant is erecting may be stated as follows: The defendant intends to carry on a crematory and columbarium in said building, now under construction, when it is completed; that the entire cost will be about $200,000, exclusive of the cost of land. The building is about 400 feet from the building line of the street, 250 feet from the plaintiff’s property and 550 feet from the building located on the plaintiff’s property; it will be Gothic type of architecture, constructed of stone granite, rock and faced granite, with the interior of the said building finished in quartered Italian travertine stone. The premises, according to plan, will have a park-like appearance, surrounded by shrubbery and trees. The building will dispose of the dead bodies by cremation only, which consists of placing the dead body in a chamber of the retort, where it is then lowered into a_secondary chamber which reaches a temperature of 2,000 degrees Fahrenheit, where the body is completely reduced to bone ash. The average length of time necessary completely to cremate a dead body is one and one-half hours. After cremation the remains of a human body become bone ash, an entirely inorganic substance, consisting chiefly of calcium phosphate. The remains are entirely harmless, even though the person had suffered and died from a contagious disease. By cremation the breakdown of the body is accomplished by rapid chemical changes of gases which are formed and are combined with oxygen. The non-gaseous part of the body while being consumed is also rapidly combined with oxygen. The average length of time for complete decomposition of a dead body by burial in the earth, mausoleum or similar means of disposition is several years, dependent upon temperature, embalming and similar conditions. A crematory operates without emitting smoke, odor or any form of harmful gases. The court refused to find that a crematory is not dangerous to the public health or welfare of a community.

Continuing, the court stated the further facts to be: That after cremation the remains are either placed in a columbarium of the crematory or taken to the home of the relatives of the deceased and kept there or scattered to the winds or buried in a cemetery or kept in undertaking establishments for further orders of the family. After cremation the remains will sometimes be kept in urns in various wall niches in the part of defendant’s building called the columbarium.

The judge at Special Term, in deciding in favor of the plaintiff and against the defendant, stated that ■ the defendant knew from the mandamus proceeding that its right to erect the building was challenged, and that, while the present action was pending, and as early as September 23, 1935, the defendant started building a columbarium on its said lands for the purpose of providing receptacles for the remains of the bodies cremated, and found as a conclusion of law that the right of the defendant to acquire lands whereon to construct and operate a crematory or columbarium is governed by the same provisions of law relating to the burial of the dead as is defined in sections 70, 76 and 78 of article IX of the Membership Corporations Law, and by section 451 of the- Real Property Law (Cons. Laws, ch. 50) relating to the acquisition of lands for cemetery purposes; he concluded that the proposed use by the defendant was unlawful.

The Appellate Division reversed the trial judge in his finding that the defendant’s land was acquired for a cemetery purpose, and granted judgment for the defendant, dismissing the complaint, and found that the crematory was not dangerous to public health and the welfare of the community.

The decision of this case turns upon whether the lands of the defendant are to be used for a cemetery purpose within the provisions of the law above stated. Turning to the evidence we find that the land is to be dedicated as an attractive final resting place for the remains of persons cremated. The secretary and general manager of the defendant stated that the business of running the crematory also consists in selling niches in the building itself and urns in which to place the ashes. The price of niches varies from $35 to $2,000 or $2,500, and the urns run from $15 up to $1,500.

Article IX of the Membership Corporations Law relates to cemetery associations. The term cemetery corporation ” (§ 70) is defined to be “ any corporation organized under a general law for the burial of the dead in a grave, mausoleum, vault or other receptacle but does not include a family cemetery corporation or a private cemetery corporation.”

Section 76 says that a cemetery corporation may acquire additional real or personal property for the purpose of: “ 5. The construction and operation of a crematory and columbarium therein.”

Section 78 we quote in full: It shall not be lawful for any corporation, association or person hereafter to set aside or use for cemetery purposes any lands in any county within the state erected on and after January first, eighteen hundred and ninety, adjoining a city of the first class and having a population of between eighty thousand and eighty-five thousand according to the Federal census of nineteen hundred and ten; but nothing herein contained shall prevent cemetery corporations formed prior to January first, nineteen hundred and seventeen, which own in such county a cemetery in which burials have been made prior t© such date, from setting apart and using for burial purposes lands lying contiguous or adjacent to such cemetery which lands have been heretofore acquired by a recorded deed of conveyance made to such a cemetery corporation either for burial purposes, or for the purposes of the convenient transaction of its general business, which lands shall have been acquired with the consent of the board of supervisors; nor to prohibit the dedication or use of land within such county for a family cemetery as provided in section one hundred and five of this chapter.” This section is practically the same as former section 85, entitled Cemeteries in Nassau County,” as amended by chapter 614 of the Laws of 1919. Counsel conceded upon the trial that this provision of section 78 related to Nassau county.

When we consider that a cemetery corporation means any corporation organized for the burial of the dead in a vault or a receptacle; that a present existing cemetery corporation may acquire property for the construction and operation of a crematory and a columbarium therein; and that Nassau county has received special attention from the Legislature by enactment which provides that no association may use for cemetery purposes ” any lands within said county, we agree with the Special Term that a crematory and a columbarium for the disposal and burial of the dead is included within these prohibitions. We are here dealing with the acts of the Legislature. What did these acts include? The cemetery referred to in section 70 means a place for the burial of the dead, not necessarily a grave in the ground or in a mausoleum or a vault, but in any other receptacle. Nothing is said about the preservation of the entire body for burial in the same form or in the same nature as existed on the day of death, but the remains of the dead person in any form which are preserved in a receptacle are included within this term " cemetery ” as applied to corporations engaged in such business.

Section 78, referring specifically to Nassau county, does not limit the use of land merely for a cemetery, but says any land which is set aside or used for cemetery purposes. This, we think, is broad enough, and is intended to be broad enough, to cover any disposal of or preservation of the remains of dead people, whether they are to be in the ground or reduced to ashes and put in niches or urns in a columbarium. The fact is, and we must face facts, that the ordinary cemetery keeps the body for a while until it is decomposed in a coffin in the ground; the crematory or columbarium decomposes it at once and keeps the remains in an urn. The purpose of the burial in the ground and of the preservation in the urn is to dispose finally of that which remains after life or spirit has departed.

In the Real Property Law, section 451, we also find restrictions upon the use of property: “ It shall not be lawful for any person to take by deed, devise or otherwise or set apart or use any land or ground in any of the counties of Westchester, Kings, Queens, Richmond, Rockland, Suffolk, Putnam or Nassau for cemetery purposes without the consent of the board of supervisors for such county, * * * and said board of supervisors * * * in granting such consent may annex thereto such conditions, regulations and restrictions as such board may deem the public health or the public good require.”

We note again the use of the words “ cemetery purposes ” not merely the word cemetery.” The purpose of a cemetery is to dispose of the dead body; such also is the purpose of the crematory. As the purposes are one and the same we find no reason for narrowing these acts of the Legislature, which must have a definite purpose in restrictions made applicable only to those counties within or adjoining the vast population of the city of New York. In fact, burial and cremation are joined together as being the same thing for the purposes of the statutes in sections 2211 and 2215 of the Penal Law and section 381 of the Public Health Law (Cons. Laws, ch. 45).

None of these questions were raised or passed upon in Matter of Leonard v. Tappen (244 App. Div. 817; affd., 269 N. Y. 567). That case dealt solely with the power to change or modify or adopt the zoning regulation.

The judgment of the Appellate Division should be reversed and that of the Special Term affirmed, with costs in this court and in the Appellate Division. (See 275 N. Y. 544.)

Lehman, O’Brien, Htjbbs, Loughran, Finch and Rippey, JJ., concur.

Judgment accordingly.


text:
    In the Matter of Merchants Refrigerating Company, Appellant, against Frank J. Taylor, as Comptroller of the City of New York, Respondent.

      Argued May 24, 1937;
    decided July 13, 1937.

      Clarence J. Shearn and Daniel E. Hanlon for appellant.
    The assessment of the city sales tax and the city utility tax against the receipts from petitioner’s storage business was not authorized by the terms of the laws. (People ex rel. Studebaker Corp. v. Gilchrist, 244 N. Y. 114; Gould v. Gould, 245 U. S. 151; People ex rel. Mutual Trust Co. v. Miller, 177 N. Y. 51.) While classifications made by the Legislatures for the purpose of taxation have been sustained, such classification must have some basis in reason and cannot be entirely arbitrary. (Gulf, C. & S. F. Ry. Co. v. Ellis, 165 U. S. 150; Quaker City Cab Co. v. Pennsylvania, 277 U. S. 389; Connolly v. Union Sewer Pipe Co., 184 U. S. 540; Iowa-Des Moines Nat. Bank v. Bennett, 284 U. S. 239; People ex rel. Phillips v. Raynes, 136 App. Div. 417; 198 N. Y. 539; New York Steam Corp. v. City of New York, 268 N. Y. 137.) To the extent that the utility tax is held to tax petitioner’s business, it constitutes a second tax on gross receipts and exceeds the authority granted to the city by the Legislature. (Matter of Atlas Television Co., 273 N. Y. 51.)

      Paul Windels, Corporation Counsel (Meyer Bernstein, Oscar S. Cox and Frank J. Derrick of counsel), for respondent.
    Petitioner’s receipts from its cold storage warehouse business constitute taxable receipts within the meaning of Local Laws No. 24 of 1934 and No. 2 of 1935. (Helvering v. Stockholms Enskilda Bank, 293 U. S. 84.) No discrimination results from the classification of the appellant’s receipts with those of other taxpayers subject to the local laws. (Carr v. West Side Warehouse Co., 169 N. Y. Supp. 564; Sutherland v. Albany Cold Storage & Warehouse Co., 171 N. Y. 269; Roberts & Schaefer Co. v. Emmerson, 271 U. S. 50; Old Dearborn Distributing Co. v. Seagram Distillers Corp., 299 U. S. 183; Colgate v. Harvey, 296 U. S. 404; Radice v. New York, 264 U. S. 292; Fox v. Standard Oil Co. of N. J., 294 U. S. 87; Kentucky Railroad Tax Cases, 115 U. S. 321; Southern Boulevard R. R. Co. v. City of New York,
      86 Fed. Rep. [2d] 633; Tyler v. United States, 281 U. S. 497; Karnuth v. United States, 279 U. S. 231; New York Steam Corp. v. City of New York, 268 N. Y. 137; Standard Oil Co. v. Marysville, 279 U. S. 582; Rast v. Van Deman & Lewis Co., 240 U. S. 342.) Amounts received from so-called handling charges are receipts from a necessary part of the service appellant renders and were, therefore; properly included in the base of the tax. (Gee Coal Co. v. Department of Finance, 361 Ill. 293; State v. Menefee Motor Co., 18 La. App. 694; People ex rel. Westchester Lighting Co. v. Gaus, 199 N. Y. 147; Lash’s Products Co. v. United States, 278 U. S. 175.)
   Crane, Ch. J.

Appellant seeks to review the determination of the Comptroller of the city of New York taxing it under the Local Laws of the city which impose a sales tax and a tax upon utilities. The Appellate Division has unanimously confirmed the determination of the respondent and dismissed the orders of certiorari. Appeal is taken here by permission of this court.

Appellant operates two storage warehouses in the city of New York which are equipped to permit the refrigeration of its storage chambers. Its property consists of steel and concrete buildings, the walls of which are insulated with cork. Refrigeration machinery and equipment, for the production and circulation of the refrigerating fluids or brine, are installed in the basements. By means of a closed system of pipes the brine leaves the machine, goes through the pipes, reduces the temperature on the premises to be refrigerated and returns by means of pipes to the refrigerating system.

At its warehouses appellant assumes full control over the merchandise delivered to it for storage. Its customers are, for the most part, dealers in perishable commodities. It supplies the labor for hauling merchandise in and out of its building; it selects and furnishes the cooling room in which the goods are placed; it maintains the proper circulation of air around the packages; and controls the correct degree of humidity. Different commodities require different types of refrigeration service. For all this service rendered, appellant’s charges are higher than those of the ordinary ware-housemen who do not supply refrigeration. Included in the charges to the customers are the amounts paid for handling of the customers’ merchandise on appellant’s premises. The handling charges for placing the goods in and bringing them out of storage are made separately and are in addition to the storage charges.

In addition to its warehouse business, appellant furnishes what is called an “ off-premises ” service. First, it furnishes refrigeration to the tenants occupying stores on the ground floor of its Seventeenth street warehouse. From its refrigerating plant in the warehouse, appellant pumps refrigerating fluid through pipes to these stores. It charges the tenants for this service, billing them separately in addition to their rent. Secondly, appellant also furnishes refrigeration to some outside premises in the neighborhood of one of its warehouses. These customers enter into yearly contracts with appellant for this service. The refrigeration is furnished by means of pipes under the streets, laid pursuant to a franchise from the city of New York. Appellant contends that the off-premises business does not amount to more than twenty per cent of its gross receipts.

Two separate taxes are imposed upon appellant under two separate local laws. We shall consider each tax separately.

Sales Tax. Local Law No. 20 (published as No. 21) of 1934 did not tax sales of refrigeration or refrigerating service. That law was amended by Local Law No. 24 (published as No. 25) of 1934. The amending law provides:

“ § 2. Imposition of tax. During the period commencing on December tenth, nineteen hundred and thirty-four, and ending on December thirty-first, nineteen hundred and thirty-five, there shall be paid a tax of two per centum upon the amount of the receipts from every sale in the city of New York of: * * *
“ (b) Gas, electricity, refrigeration and steam, and gas, electric, refrigeration, * * * service, for domestic or commercial use.”
“ Receipts ” is defined in section 1 as meaning “ the amount of the sale price of any property or the charge for any service ” specified “ without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or service cost, interest or discount paid, or any other expense whatsoever.” In section 2 it is also stated that upon each taxable sale or service, the tax to be collected shall be stated and charged separately from the price or charge and shown separately upon any record, and shall be paid by the purchaser to the vendor forrand on account of the city of New York. Where the purchaser has failed to pay or the vendor has failed to collect, the tax is payable by the vendor directly to the Comptroller. In section 6 it is provided that each vendor shall pay to the Comptroller the taxes imposed by this local law upon the receipts required to be included in his return. All taxes for the period shall be due from the vendor and payable to the Comptroller “ without regard to whether a return is filed or whether the return which is filed correctly shows the amount of receipts and the taxes due thereon.”

In Matter of Atlas Television Co. (273 N. Y. 51) this court said: “We might agree with that conclusion if the local law did not contain other provisions which indicate that the obligation imposed upon the vendor is in the nature of a tax. He must file a return of his receipts from sales. (§ 5.) The duty of payment to the city is laid upon the vendor, not the purchaser. His liability is not measured by the amount actually collected from the purchaser but by the receipts required to be included in such return. (§ 6.) He must pay the tax even if failure to collect is due to no fault of his own ” (p. 57).

Appellant has paid to the city of New York the sales tax on sales of refrigeration service made by appellant through pipe lines under its franchise with the city, and also under its annual written contracts with its lessees. The city has imposed the sales tax upon its refrigeration service to customers within its warehouses for the period from December 10, 1934, to August 31, 1935. Appellant insists that as to its warehouse business, it does not sell refrigeration; that it stores goods and in connection therewith it uses refrigeration. In giving substance to this distinction, appellant compares itself to the operators of skating rinks, makers of ice cream, and owners of places air-cooled in summer, and contends that like them it performs a service in connection with which it uses refrigeration. It' contends that it no more furnishes a refrigerating service than a turkish bath or a steam laundry furnishes a steam service, or a theatre furnishes a refrigerating service in the hot weather. We agree with the appellant that the cooling of its storage rooms for the preservation of merchandise is not a sale of refrigeration or a sale of refrigeration service within the wording or meaning of this Local Law No. 20 (published as No. 21), as amended by Local Law No. 24 of 1934 (published as No. 25). The temperature may attract customers and increase the charge but safe storage is the service sought and paid for.

Utility Tax. Local Law No. 21 (published as No. 22) of 1934 was amended by Local Law No. 2 of 1935 so as to include within its purview a utility furnishing refrigerating service. The amended law provides: 1. (e) The word 1 utility ’ shall be deemed to refer to and mean any person subject to the supervision of either division of the department of public service, and every person whether or not such person is subject to such supervision who shall engage in the business of furnishing or selling to other persons gas, electricity, steam, water, refrigeration, telephony and/or telegraphy or who shall engage in the business of furnishing or selling to other persons gas, electric, steam, water, refrigeration, telephone or telegraph service.”

Section 2 of the Local Law provides: Notwithstanding any other provision of law to the contrary, for the privilege of exercising its franchise or franchises, or of holding property, or of doing business in the city of New York, during the calendar year nineteen hundred thirty-five, or any part thereof, every utility doing business in the city of New York and subject to the supervision of either division of the department of public service, * * * and every other utility doing business in the city of New York shall pay to the comptroller of the city of New York an excise tax which shall be equal to three per centum of its gross operating income for the calendar year nineteen hundred thirty-five. Such tax shall be in addition to any and all other taxes and fees imposed by any other provision of law * *

Under section 1, subdivision (d), the “ gross operating income ” shall be deemed to refer to and include receipts received by reason of any sale made or service rendered of the property and services specified without any deduction therefrom on account of the cost of the property sold, the cost of materials used, labor or services or other costs, interest or discount paid, or any other expenses whatsoever.”

The city has subjected the appellant’s entire refrigeration business — storage and all — to this utility tax. If the construction of the statute urged by the city is adopted, the statute is unconstitutional as arbitrary and discriminatory —■ unreasonable.

In New York Steam Cory. v. City of New York (268 N. Y. 137) this court had before it an earlier local law of the city of New York (Local Law No. 19 of 1933) imposing a tax upon public utilities. That law did not include refrigeration services, and imposed a tax upon persons subject to the supervision of either division of the Public Service Commission. It was attacked as an unconstitutional discrimination, depriving the utility of equal protection of the law. This court sustained the law, saying: “ In our opinion reasons justifying that separation are apparent. Plaintiff is one of a group — those subject to supervision by the Public Service Commission — that, because of the. public service nature of their respective businesses, are accorded a degree of protection against competition and other advantages over the general business community. This common character of the group is, we think, a valid basis of classification for the purposes of this tax ” (p. 147).

Appellant maintains that its inclusion in the classification is arbitrary because it possesses none of the common characteristics of the other utilities; that it is accorded no degree of protection against competition; is not under the supervision of the Public. Service Commission; and has no advantages over the general business of the community. Appellant has only one advantage conferred on it by the city, namely, as to its off-premises service supplied to nearby properties, it is permitted by the city to lay its pipes in the street.

In Colgate v. Harvey (296 U. S. 404) the United States Supreme Court said: “ It is settled beyond the admissibility of further inquiry that the equal protection clause of the Fourteenth Amendment does not preclude the states from resorting to classification for the purposes of legislation. Royster Guano Co. v. Virginia, 253 U. S. 412, 415. And ‘ the power of the state to classify for purposes of taxation is of wide range and flexibility * * *. Louisville Gas Co. v. Coleman, 227 U. S. 32, 37. But the classification ‘ must be reasonable, not arbitrary, and must rest upon some ground of difference having a fair and substantial relation to the object of the legislation, so that all persons similarly circumstanced shall be treated alike ’ * * * The classification, in order to avoid the constitutional prohibition, must be founded upon pertinent and real differences, as distinguished from irrelevant and artificial ones. The test to be applied in such cases as the present one is — does the statute arbitrarily and without genuine reason impose a burden upon one group of taxpayers from which it exempts another group, both of them occupying substantially the same relation toward the subject matter of the legislation? Mere difference is not enough. * * * ’ Louisville Gas Go. v. Coleman, supra; Frost v. Corporation Commission, 278 U. S. 515, 522 ” (p. 422).

In New York Steam Corp. v. City of New York (supra) this court said: “ It is not asserted that the Fourteenth Amendment forbids selection among businesses for subjection to a State excise tax, if determined by some reasonable policy of differentiation, and all in the same class have equality ” (p. 146).

It was said by this court in People ex rel. Farrington v. Mensching (187 N. Y. 8, 21, 22): The rule governing the subject, as laid down by the Supreme Court of the United States, is that there must be * some difference which bears a reasonable and proper relation to the attempted classification.’ It cannot be ‘ mere arbitrary selection.’ * * * By this we do not understand that great court to mean that the relation must necessarily be ‘ reasonable and proper ’ according to the judgment of reviewing judges, but that the court must be able to see that legislators could regard it as reasonable and proper without doing violence to common sense. In other words, there must be enough reason for it to support an argument, even if the reason is unsound. At all events that is as far as it is necessary for us to go in this case, where no reason whatever can be seen for selecting certain individuals of a class and taxing them more heavily than others in the same situation.” This case was later overruled, but for other reasons (Vaughan v. State of New York, 272 N. Y. 102).

Passing for a moment the franchise granted by the city to use its streets, what reason exists for including appellant in the class of those upon whom the tax falls? The city answers that the method, character and nature of appellant’s business are sufficiently different from those of general non-refrigerated warehouses to justify difference in treatment for purposes of taxation. Different they, of course, are. Even so, I apprehend that a tax imposed only on warehousemen generally would offend the Constitution as much as one imposed only on cold storage warehousemen. A second reason is suggested in that those engaged in rendering the service specified in the local law benefit substantially from money made available for unemployment relief as such services are necessary and essential to modern life; that they benefit materially from the improvement in business. To the same extent would a food merchant, a clothing merchant — in fact, every business man in general. The reasons advanced by the city in support of the classification do not indicate a difference between appellant and other businesses not taxed which bears any reasonable relation to the attempted classification. Most of those utilities included within the classification have common characteristics that differentiate them from business in general. The classification was, as to them, held reasonable. Appellant does not share that common characteristic. No reason appears why appellant should be included within the incidence of the tax, while business in general was exempted.

As stated above, appellant furnished refrigeration to persons outside its building by means of pipes laid in the streets under a franchise from the city. This constitutes but a small proportion of appellant’s business but justifies, nevertheless, the utility tax upon this part of its income. The gross operating income from these franchised sales must and can be taxed under this Local Law No. 2 of 1935.

A third objection is made by appellant to the imposition of these taxes. The statute which conferred authority on the city to enact these local laws is chapter 873 of the Laws of 1934. That act reads: “ Provided, however, that nothing herein contained shall limit or prevent the imposition of a tax on gross income or a tax on gross receipts of persons, firms and corporations doing business in any such city. No such person, firm or corporation, however, shall be subject to the imposition of more than one tax by any such city on gross income or gross receipts under the provisions of this act ” (§ 1).

Appellant contends that it is twice taxed on its gross receipts, once by the sales tax, and once by the utility tax. As pointed out by the city, the sales tax falls upon the purchaser while the utility tax falls upon the utility itself. The Atlas Television case (273 N. Y. 51) did not hold that the sales tax is imposed on the vendor, but only that he is under a duty to pay the tax to the city regardless of whether or not the vendor collects it from the purchaser.

This point was not raised in the New York Steam Corporation case. There the action was begun February 1, 1934, and it attacked Local Law No. 19 of 1933, adopted pursuant to authority conferred by chapter 815, Laws of 1933. The Sales Tax Law was not adopted until 1934, to take effect in December of that year.

For the reasons here stated the order of the Appellate Division should be reversed and the matter remitted to the Special Term to proceed in accordance with this opinion, with costs to the appellant in all courts.

Lehman, O’Brien, Hubbs, Loitghran, Finch and Rippey, JJ., concur.

Ordered accordingly.


text:
    Kasimir Sajor, Respondent, v. Ampol, Inc., Appellant, Impleaded with Another.
    Argued June 11, 1937;
    decided July 13, 1937.

      Robert Daru and Oswald Vischi for appellant.
    There was no violation of article 23-A of the General Business Law (Cons. Laws, ch. 20) when the contract in suit was made because there had been up to that time no offer to sell or sale of securities to the public in this State. (People v. Ruthven, 160 Misc. Rep. 112; Durham, Citizens Hotel v. Dennis, 195 N. C. 420; Gillespie v. Long, 212 Ala. 34; Raynard v. State, 19 Ala. App. 281; Commonwealth v. Pastor, 289 Penn. St. 22; Matter of Scheftel, 155 Misc. Rep. 632; Kawin v. American Colortype Co., 243 Fed. Rep. 317; Montgomery Light & Power Co. v. Montgomery Traction Co., 219 Fed. Rep. 963.) Even if it be assumed that the statute was applicable to appellant, the mere non-filing of a State notice prior to that date did not make the contract void. (Matter of Ottinger v. Civil Service Comm., 240 N. Y. 435; People v. Federated Radio Corp., 244 N. Y. 33; Dunham v. Ottinger, 243 N. Y. 423; Fosdick v. Investors Syndicate, 266 N. Y. 130; Merchants Line v. B. & O. R. R. Co., 222 N. Y. 344; Mahar v. Harrington Park Villa Sites, 204 N. Y. 231; Sinnott v. German-American Bank, 164 N. Y. 386; Gay v. Seibold, 97 N. Y. 472; Furlong v. Johnston, 209 App. Div. 198; Cody v. Dempsey, 86 App. Div. 335; Matter of Birner v. Santa Lucia Wineries, Inc., 155 Misc. Rep. 722.)

      George H. Zator for respondent.
    An innocent misrepresentation is sufficient to permit the purchaser to recover money paid on his purchase whether his action be one in equity for rescission or an action at law based on rescission, and in neither case need he prove that the party making the misrepresentation should have known it was false. (Bloomquist v. Farson, 222 N. Y. 375; Seneca Wire & Mfg. Co. v. Leach & Co., 247 N. Y. 1; Downey v. Finucane, 205 N. Y. 251; Bystrom v. Villard, 188 App. Div. 964; 230 N. Y. 588; Hayward v. Leeson, 176 Mass. 310; Wiser v. Lawler, 189 U. S. 260; Spotton v. DeFreest, 140 App. Div. 792; Von Au v. Magenheimer,
      126 App. Div. 257; 196 N. Y. 510.) The subscription agreement for the purchase of the capital stock was made in violation of law and will not be enforced. (People v. Bellinger, 269 N. Y. 265; Standard Sanitary Mfg. Co. v. United States, 226 U. S. 20.)
   Crane, Ch. J.

On April 5,1932, the plaintiff, Kasimir Sajor, subscribed to thirty units of capital stock of Ampol; Inc., each consisting of one share of common stock of $10 par value and one share of preferred seven per cent cumulative stock, par value $90, for which he agreed to pay $100 per unit. Later he paid $1,000 and subsequently brought this action to recover it back and to cancel his subscription on the ground of fraud. He alleged that the defendant corporation and Wegrzynek, the president, sold him this stock through false representations in representing that the corporation was organized at the instance and request of the Polish Government; that the Polish National Alliance of the United States had subscribed, as well as the Polish Roman Catholic Union. Other allegations of fraudulent representations are set forth, together with a statement that Ampol, Inc., had duly complied with the law of the State of New York by filing the necessary information with the Attorney-General as a prerequisite for the sale of the stock.

The answer was a general denial with a counterclaim for the balance due on the subscription of $2,000. On the trial of the issues evidence was introduced to show that the corporate defendant had a capital stock originally of $110,000 which in February, 1935, was increased to $220,000. The stock was 1,000 shares of seven per cent preferred with a nominal value of $90 and 2,000 common shares with a nominal value of $10 each. Ampol, Inc., was incorporated to encourage and carry on business between Poland and the United States, and the individual defendant was its president. Through the president it sought to dispose of some of its stock to a few persons who might be interested in becoming agents or in establishing agencies for the company. The plaintiff was induced to subscribe on an arrangement whereby he was to be such an agent. The trial judge made very definite and sweeping findings of fact whereby he brushed aside all charges of fraud and based his decision for the plaintiff solely upon the defendant’s failure to comply with section 359-e of the General Business Law (Cons. Laws, ch. 20).

The trial judge found that Ampol, Inc., was a domestic corporation and that Max F. Wegrzynek was its president; that in signing the subscription agreement the plaintiff relied solely on the president’s statement that if plaintiff completed his purchase of defendant’s stock, the defendant would grant him an exclusive agency for, its food products in Brooklyn and Long Island; that the president was acting in good faith and intended to grant the plaintiff such an agency;.that none of the representations pleaded in the complaint were at any time made by or on behalf of the defendant and the representations which were made for the defendant were true; 7. That no material misrepresentations of any kind upon which plaintiff relied were made by defendant or its president, Max F. Wegrzynek,” and as a conclusion of law the trial court found “ that there was no fraud or misrepresentation entitling plaintiff to a rescission of the subscription agreement dated April 5, 1932.”

The only finding to sustain the plaintiff’s judgment is that which mentions the violation of section 359-e of the General Business Law. In a word, this statute requires dealers in securities to file a statement with the Department of State and to pay a fee of $2.50. (See § 359-c.) These provisions of section 359-e so far as pertinent read as follows: “ The word dealer ’ or ‘ dealers ’ * * * shall include * * * corporation * * * who engages directly or through an agent in the business of trading in securities in such manner that as part of such business any of such securities are sold or offered for sale to the public in this state * * *. The business of trading in securities within the meaning of this section shall not include an isolated transaction in which a specific security is sold or offered for sale, by the owner thereof, or by his representative, for the owner’s account, such sale or offer of sale not being made in the course of repeated and successive transactions of a like character by such owner, or for his account by such representative, and such owner or representative not being the issuer or underwriter of such security. A sale or offer of sale to the public shall not include an isolated transaction of the nature above mentioned * *

Subdivision 1 of that section reads in part as follows:

1. After this subdivision as hereby amended takes effect, no dealer shall sell or offer for sale to the public within this state, as principal, broker or agent, any securities issued or to be issued unless and until a notice, to be known as the state notice,’ containing the name, business or post-office address of such dealer and if such dealer is a corporation the state or country of incorporation thereof, and if a partnership the names of the partners, shall have been filed in the department of state.” (Laws of 1928, ch. 710, § 3, emphasis supplied.)

The trial judge found upon ample evidence that the defendant sold or offered for sale only its own stock; that it employed no stock salesmen, solicitors or brokers, and did not deal in securities of any other corporation. 11. That the only person who sold or offered for sale defendant’s stock was Max F. Wegrzynek who did so in connection with his duties as president and organizer of defendant corporation.” The judge further found that Wegrzynek offered the stock only to his personal friends and business associates; he also found that the corporation was organized in good faith for the purpose of engaging in the business of importing and exporting merchandise from and to the Republic of Poland.

There may be some doubt whether the defendant corporation in disposing of its stock, under the conditions here described and stated by the trial judge, was or became a dealer within the meaning of section 359-e of the General Business Law. We need not, however, settle this point at this time as there is another feature of the case which requires us to reverse the judgment and dismiss the complaint.

The courts below have found that the failure to file this notice at the time when the defendant, through its president, commenced negotiations with the plaintiff rendered the sale null and void. Subsequently, at a later date, the defendant complied with all the provisions of this law, but we will assume, as have the courts below, that at the time of the sale to the plaintiff the notice had not been filed. The notice, requiring the name of the dealer, his business or post office address, the State of incorporation and other like matters, in no way affected the plaintiff’s purchase. Such a statement had no relation whatever to his transaction. Its purpose was to inform the Attorney-General and the State authorities of the stock business carried on by dealers and of the place where such business was to be conducted. The plaintiff has merely seized upon this failure to get out of a legitimate transaction and avoid his liability. The contract of purchase was legal; there has been no failure of consideration, no over-reaching, no fraud. It is as valid and enforceable as any contract of sale can be. The plaintiff seeks to void it upon this irregularity or omission of the notice required of the corporation for State purposes. The statute does not make sales void or voidable or unenforceable when such notice has not been filed. Such is the requirement of many of the States of the Union which have similar statutes. Our statute has an omnibus provision relating to° the violation of any provision of article 23-A of the General Business Law, making the violation a misdemeanor punishable by a fine of not more than $500, or imprisonment of not more than one year, or both. (§ 359-g, subd. 2.) This penalty provided for the violation is the exaction which the law makes, and no other. We should not read into the provisions of the statute that which other State legislators have found necessary to insert, in order to reach the transactions between the parties. Our Legislature intended by the penal consequences to require all dealers in securities to comply with the terms of the General Business Law so that the State might have information whereby it could proceed either criminally or civilly. It did not intend to make void or voidable any and every contract made with a corporation dealer, otherwise valid, simply because it had failed to comply with the many administrative provisions of this law. Such has been our ruling in cases like Fosdick v. Investors Syndicate, Inc. (266 N. Y. 130); Merchants’ Line v. B. & O. R. R. Co. (222 N. Y. 344); Mahar v. Harrington Park Villa Sites (204 N. Y. 231); Warren People’s Market Co. v. Corbett & Sons (114 Ohio St. 126); Pangborn v. Westlake (36 Iowa, 546); Winters v. Lindsay (52 Cal. App. 93); Watters & Martin, Inc., v. Homes Corp. (136 Va. 114); Escalle v. Mark (43 Nev. 172).

The appeal to this court is by Ampol, Inc., the corporation defendant, as the complaint was dismissed below as to the individual defendant. The appeal to this court was by permission of the Appellate Division.

The judgments should be reversed and the complaint dismissed and judgment directed for the defendant Ampol, Inc., on its counterclaim, with costs in all courts.

Lehman, Hubbs, Loughban, Finch and Rippey, JJ., concur; O’Bbien, J., taking no part.

Judgment accordingly.

       The following States have such provision: Alabama (Code of Alabama, 1928, ch. 335, art. 12, § 9899); Colorado (Laws of 1923, ch. 168, § 8); Florida (Laws of 1931, ch. 14899, § 16); Illinois (Laws of 1919, pp. 351, 364, § 37); Iowa (Code of 1935, ch. 393-el, § 8581-C18; Kansas (Laws of 1929, ch. 140, § 18); Michigan (Public Acts of 1923, act No. 220, § 20); Missouri (Laws of 1929, pp. 387, 409, § 25); North Dakota (Laws of 1923, ch. 182, § 16); Oklahoma (Laws of 1931, art. 11, ch. 24, § 16); Utah (Laws of 1925, ch. 87, § 18); Vermont (Acts of 1929, act No. 93, § 17); Virginia (Acts of 1928, ch. 529, § 15); and Wisconsin (Wis. Stats. ch. 189, § 189.15).