text:
    In the Matter of General Reinsurance Corporation, Respondent, against Louis H. Pink, as Superintendent of Insurance of the State of New York, Appellant.
    (Argued November 18, 1935;
    decided January 7, 1936.)

      John J. Bennett, Jr., Attorney-General (Robert N. Rose and Henry Epstein of counsel), for appellant.
    The legislative purpose of section 16 of the Insurance Law (Cons. Laws, ch. 28) is to control and restrict assets of insurance companies and the manner of their investment. (Manhattan Co. v. Kaldenberg, 165 N. Y. 1; 108 Park Ave. Co. v. Exchange Buffet Corp., 242 N. Y. 366.) Subdivision 12 of section 16 of the Insurance Law prohibits the acquisition by respondent of the “ excess ” shares and subdivision 4 has the same meaning. (People ex rel. Parker Mills v. Commissioners, 23 N. Y. 242; Trefey v. Putnam, 227 Mass. 522; Penfield v. Tower, 46 N. W. Rep. 413.) Cognizance should be taken of the mischief intended to be removed or suppressed. (Matter of Washington St. A. & P. R. R. Co., 115 N. Y. 442; Hayden v. Pierce, 144 N. Y. 512; People v. Purdy, 154 N. Y. 439.)

      Hartwell Cabell, Milton B. Ignatius and James M. Lown for respondent.
    The provisions of subdivision 4 of section 16 of the Insurance Law relate exclusively to the investment of existing capital and surplus of insurance companies. (Morse v. Equitable Life Assur. Society, 124 App. Div. 235; People ex rel. Lemmon v. Feitner, 167 N. Y. 1; La Belle Iron Works v. United States, 256 U. S. 377; Inland Revenue Commrs. v. Gas Lighting Improvement Co., [1922] 2 K. B. 381; Person v. State Tax Commrs., 115 S. E. Rep. 336; Fidelity & Deposit Co. v. Freud, 115 Md. 29; State ex rel. Stull v. Bartley, 41 Neb. 277; State v. Gopher Tire & Rubber Co., 146 Minn. 52; Drake v. Crane, 127 Mo. 85; Una v. Dodd, 39 N. J. Eq. 173; San Diego Sav. Bank v. Barrett, 126 Cal. 413.)
   Crouch, J.

The General Alliance Corporation is a

domestic business corporation. The General Reinsurance Corporation is a domestic insurance corporation authorized to issue various kinds of insurance, but actually confining itself to reinsurance and excess insurance. The North Star Insurance Company is also a domestic insurance corporation conducting a fire reinsurance business. In 1932 the General Alliance Corporation owned all the stock, except directors’ qualifying shares, both of the General Reinsurance Corporation and the North Star Insurance Company. In May of that year the General Alliance Corporation transferred to the General Reinsurance Corporation as a gift 7,925 shares of the stock of the North Star Insurance Company. The purpose of the gift is stated to have been a desire to strengthen and increase the surplus of the General Reinsurance Corporation which had declined under the prevailing shrinkage in general security prices. There is here no question of the financial soundness of any of the companies referred to, nor are we concerned with the validity of the gift or the motive which prompted it.

In 1933 the transaction came to the attention of the Superintendent of Insurance as part of an examiner’s routine report on the condition and affairs of the General Reinsurance Corporation. The examiner, pursuant to the usual formula, estimated the value of the North Star stock at $2,274,078.75 and determined that there was' a statutory excess of insurance company stock owned by the General Reinsurance Corporation amounting to $919,184.89. Accordingly the examiner deducted that excess as an asset not admitted in the financial statement. To that portion of the examiner’s report the General Reinsurance Corporation objected. A hearing was had before the Superintendent of Insurance, the objection was overruled and the examiner was sustained. Thereupon this proceeding was brought to review the Superintendent’s ruling. The dispute hung upon an interpretation of subdivision 4 of section 16 of the Insurance Law (Cons. Laws, ch. 28) which provides, among other things, that “No such funds of any domestic insurance corporation shall be invested in * * * stock of any insurance corporation, * * * except * * * a stock insurance corporation, other than life, * * * may invest not more than fifty per centum of its surplus funds directly in the stocks of other insurance corporations.” The petitioner contended that the statute related solely to the investment of existing capital and surplus; or, differently expressed, that it had reference solely to a situation where existing funds or assets of a corporation are to be disbursed or used to acquire another asset consisting of shares of stock in another insurance company; and, hence, that donated property in any form and of any sort could be owned and held by an insurance corporation as an asset free from the limitations on the character of investments imposed by statute.

With that contention the Appellate Division agreed, and accordingly annulled the determination of the Superintendent of Insurance.

We take the other view. The literal language quoted above, construed in the light of its statutory setting, permits, we think, no such interpretation as that contended for. Construed in the light of its obvious purpose and of its underlying policy, that interpretation becomes impossible and noxious.

Section 16 of the Insurance Law is a fairly comprehensive investment code for insurance corporations. No interpretation of a word, phrase or sentence contained in it should be made without reference to the scheme of the entire section. One notes at the outset that the section deals affirmatively with the investment of the minimum capital required by law, and then with the residue of the capital and the surplus moneys and funds. Into one or the other of these categories would seem to fall all the assets of a corporation, leaving no room for a tertium quid in the shape of a gift. “No such funds ” — the phrase which opens subdivision 4 — refers to the preceding categories. If they are all inclusive, as we think, then the gift when given is included, and is subject both to the prohibition and to the exception of that subdivision. The gift was no less an investment because it came to the donee already invested in the form of stock. Moreover. when we come to subdivision 12, we find a repetition of the prohibition against funds invested in the stock of another insurance company; and there the prohibition is coupled with a command directed to the corporation which owns such prohibited securities to dispose of them as provided. There can be little doubt about the meaning of the phrase “ be invested ” in subdivision 12, and there is no good reason for giving it another meaning in subdivision 4.

Going beyond the mere letter of the particular statutory provision, we find not only in the context of section 16, but in many other provisions of the Insurance Law and of cognate statutes, clear indication of the legislative intent. It is trite to say that the insurance business in its manifold forms affects the public as few others do, and hence that the financial stability of insurance companies is an element of prime importance to the public. Without referring in detail to the many scattered provisions obviously framed for purposes of safety and security, we may say broadly that almost all of them were evoked by dire experience. So when the Legislature has in substance said that the assets of insurers in an amount equal to their liabilities, their capital and at least fifty per cent of their surplus should be invested in specified types of securities, which exclude the stock of other insurers, we may be reasonably certain it did not intend that the surplus of any company 'should, by gift or otherwise, be built up in disregard of the limitation. It intended for competitive reasons to grant insurers an opportunity to secure business through control of other companies so far, and only so far, as might be consistent with safety and stability. In short, the intent was that all assets from whatever source derived should be subject to the provisions of section 16.

The order appealed from should be reversed and the determination of the Superintendent of Insurance confirmed, with costs in all courts.

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

Ordered accordingly.


source: Caselaw Access Project

author:
Loughran, J.
      Lehman, J.

license: Public Domain

text:
    Blanche Paige, an Infant, by Mary Venton, Her Guardian ad Litem, Respondent, v. The State of New York, Appellant,
    (Claim No. 23310.)
    (Argued November 27, 1935;
    decided January 7, 1936.)

      John J. Bennett, Jr., Attorney-General (Henry Epstein and Leon M. Lay den of counsel), for appellant.
    The State is not hable for the injuries occasioned to the claimant. (Glennie v. Falls Equipment Co., 238 App. Div. 7; Smith v. B. & A. R. R. Co., 181 N. Y. 132; Locke v. State, 140 N. Y. 480; Matter of Mandatto v. Hudson Shoring Co., 190 App. Div. 71; 229 N. Y. 624; Blake v. Ferris, 5 N. Y. 48; Town of Pierrepont v. Loveless, 72 N. Y. 211; St. Agnes Training School for Girls v. County of Erie, 68 Misc. Rep. 648.) There was no negligence proven. (Sandier v. Garrison, 249 N. Y. 236.)

      Rollin B. Sanford and Sidney L. Grossman for respondent.
    The State is hable for the neghgence of its officers and employees while acting as such. (Jackson v. State, 261 N. Y. 134.) The State was neghgent. (Scalia v. State, 147 Misc. Rep. 622; Collins v. Waterbury Co., 144 App. Div. 670.)
   Loughran, J.

The question to be determined is whether the now unquestioned facts make out a liability of the State in tort under section 12-a of the Court of Claims Act. By that section it is provided: “ The state hereby waives its immunity from liability for the torts of its officers and employees and consents to have its hability for such torts determined in accordance with the same rules of law as apply to an action in the supreme court against an individual or a corporation, and the state hereby assumes liability for such acts, and jurisdiction is hereby conferred upon the court of claims to hear and determine ah claims against the state to recover damages for injuries to property or for personal injury caused by the misfeasance or neghgence of the officers or employees of the state while acting as such officer or employee.”

The case for the claimant was that she was committed by a pohee court to a privately owned reformatory pursuant to a statute (Laws of 1902, ch. 603) whereby that institution was authorized to receive and hold ” her for a term within her minority; that without adequate instruction she was there made to operate a complex and dangerous machine for ironing fabrics; that while so engaged, without fault on her part, she was maimed by defective action of the apparatus; and that she would not have been seriously hurt had she (or any one else who was present) known how to use a device designed to safeguard the operator in such an emergency. The Court of Claims ruled that the negligence of those in charge of the institution was a tort of officers and employees of the State acting as such, and that, in accordance with the foregoing provision of the Court of Claims Act, the claimant should recover for her injuries.

That decision was adopted by the Appellate Division, except for a modification increasing the damages awarded. In the opinion of that court reference is made to provisions of the State Charities Law (Cons. Laws, ch. 55) respecting the right of the State to visit, inspect and supervise the reformatory which had custody of the claimant, and to evidence that the institution had not been visited by any representative of the State for more than a year before the accident. Upon this phase of the case the Appellate Division offered this commentary: It may not be said that the State can escape liability under the statutes referred to, when inexperienced and irresponsible girls, under its authority, may be placed in restraint for safe keeping in institutions under the control and supervision of the State, when there is a substantial disregard of the duty of inspection and supervision which the statute requires, and personal injury results from such non-feasance.” (245 App. Div. 126, 129.) In any case the judgment cannot be affirmed on that basis, because the findings are not sufficient to support such a conclusion as matter of fact. We agree, however, to the result reached below on the findings as made and affirmed, and so we need add little more than some suggestion of the reason why we would perhaps be reluctant to accept the conception of the case expressed in the opinion of the Appellate Division.

Visitation, inspection and supervision of institutions of the class that includes the reformatory to which the claimant was committed is commanded by the Constitution of the State (Art. VIII, § 11). The command is addresed to the State Board of Social Welfare, whose composition and jurisdiction are defined by article 2 of the State Charities Law. This court has definitely analyzed the real character and meaning of these requirements of superintendence of institutions of a charitable, correctional or reformatory character. In People ex rel. State Board of Charities v. New York Society for Prevention of Cruelty to Children (161 N. Y. 233, 244) we said: “ The powers of the board over charitable institutions originated in the abuses supposed to exist in the appropriation and expenditure of public money for charitable purposes. Therein is to be found the reason of the law.” On reargument of that case, the same limitation was restated in these words: “ The purpose was to safeguard the expenditure of public money for the support and maintenance of indigent persons in public or private institutions; and hence the language employed should be made subservient to that purpose ” (162 N. Y. 429, 435). In the light of that case, the Constitution does not appear to us distinctly to declare a duty of visitation and care owed to the inmates of the institution in question. Argument may be nob less strong that the duty was imposed in the interest of the State alone and, in that view, the Constitution did not establish any correlative legal right of the claimant as an individual. (See Palsgraf v. Long Island R. R. Co., 248 N. Y. 339, 341; Green on Rationale of Proximate Cause, ch. 1.) When the question is raised we can consider whether State liability may result from the duty of State oversight of such institutions. It suffices now, as we have indicated, that the judgment for the claimant does not rest on any remissness of the State Board of Social Welfare.

The quasi-penal institution in which the claimant was confined was a governmental agency to which the State had committed in part its function to care for wayward minors. (Laws of 1902, ch. 603; Corbett v. St. Vincent’s Industrial School, 177 N. Y. 16.) But the institution did not thereby acquire a status equivalent to that of the civil divisions of the State. (See Murtha v. New York Homeopathic Medical College & Flower Hospital, 228 N. Y. 183.) There is no misuse of language in saying that the State employed the institution. (Cf. People ex rel. State Board of Charities v. New York Society for Prevention of Cruelty to Children, 162 N. Y. 429, 434.) If the word agent ” were found in section 12-a of the Court of Claims Act would it be held that this case was outside the State’s assumption of liability? The terms agent ” and employee ” have been used interchangeably in the cases that dealt with State immunity from liability for tort. (Litchfield v. Bond, 186 N. Y. 66, 82, 83; Murtha Case, supra, p. 185.) In Jackson y. State (261 N.. Y. 134, 138) it was said: “ Section 12-a constitutes a recognition and acknowledgment of a moral duty demanded by the principles of equity and justice.” In that spirit, we accept the construction of the section here adopted by the courts below.

Recently in this court the servant of a temporary agent of the State was characterized as a State employee. (Maltby v. County of Westchester, 267 N. Y. 375.) In our opinion, that case is not by consistent reasoning to be soundly distinguished from this. All the essential difference is that here the public moneys received by the State’s agent did not come out of the State treasury. To exalt that circumstance to a ground of distinction in itself would be unnecessarily to blunt the beneficient purpose of the waiver by the State of its immunity. No rule of construction compels that course. (Sipple v. State, 99 N. Y. 284, 289.)

The judgment should be affirmed, with costs.

Lehman, J.

(dissenting). The claimant, against her will, was committed by a Police Court to a privately owned reformatory. There, without fault on her part, she sustained serious and permanent injury through negligence on the part of agents and employees of the reformatory. The custody of persons convicted of crime “ is one of the functions of government which the state may exercise and which it may delegate to charitable institutions created under its laws.” In the exercise of that delegated function the reformatory is “ entitled to the same immunity from liability for damages * * * that is conceded to the state itself and to all its municipal divisions.” 0Corbett v. St. Vincent’s Industrial School, 177 N. Y. 16,21.) Immunity from liability for injuries wrongfully inflicted upon an individual creates injustice. The moral obligation to compensate for such injuries may be clear, yet even in such cases the Legislature alone has power to waive the immunity. The courts have no power to destroy it.

By section 12-a of the Court of Claims Act the State has waived its “immunity from liability• for the torts of its officers and employees.” Now, it is said that the negligence of the private reformatory and its employees is the negligence of “ officers or “ employees of the-State, and that the State may be charged with responsibility for the wrong suffered by the claimant at their hands. Such construction of the statute goes, I think, far beyond the plain meaning of its langúage. No case is cited where heretofore such responsibility has ever been asserted against the State.

The functions of government which the State may exercise directly or which it may delegate to corporations or quasi corporations, cover a broad field. The State commonly does delegate many of these functions to local governmental agencies. It is too well established to be disputed now that, in the promotion of public health and care of the sick, in public education, in police and fire protection, in the maintenance of jails, courthouses and police stations, hospitals, schools, fire departments, and in other activities which serve the welfare of the people of the State, municipal corporations exercise governmental functions and, except as otherwise provided by law, are immune from suit. (See McQuillin on The Law of Municipal Corporations, vol. 6, §§ 2792-2798.) Perhaps such immunity should be withdrawn from them by the State, but it can hardly be supposed that in enacting section 12-a of the Court of Claims Act the State intended to assume liability for the negligent acts of governmental agencies which are themselves immune.

There is nothing in the language of the statute which can support a construction so extraordinary. It does not purport to create a new liability or a new wrong where none existed before. It merely waives the State’s immunity from liability for the torts of its “ officers and employees.” These terms have well-established meanings. Certainly corporations, whether municipal or private, which exercise delegated governmental functions are neither officers nor employees of the State. That does not mean that an agent of the State cannot be its officer or employee. It does mean that a corporation does not become an officer or employee merely because the State has delegated to it some governmental functions.

Nothing said or decided in Maliby v. County of Westchester (267 N. Y. 375, 379) touches the question here presented. There the State did not delegate to the county of Westchester or to its Park Commission the function of road construction, but merely used the county as its own agent, as it might use an individual, for the building and construction of a road out of the moneys of the State. As Chief Judge Crane pointed out in his opinion, the work “ was being performed and paid for by the State through the Westchester County Park Commission as its agent.” Even so, we held only that the county of Westchester was not liable. We did not pass upon the liability of the State. A special statute of the State expressly governed liability there.

That case illustrates the distinction between work performed by the State through an agent and work performed by a corporation in the exercise of a governmental function delegated by the State. Persons employed by an agent in performing the work of the principal are employees of the principal, not the employees of the agent. When the State delegates governmental functions to a corporation, municipal or private, the law has always recognized that the corporation in performing those functions acts as principal. Its contracts are binding upon it in its corporate capacity and it performs its work through its own employees. It has never been questioned that teachers, policemen, firemen, nurses and hospital attendants employed by a corporation in the performance of governmental functions are the employees of the corporation, not of the State. We held nothing to the contrary in Maltbyv. County of W estchester (supra); but a decision that the corporation, while exercising a governmental function, acts as agent of the State, and that the State, except for its governmental immunity, is responsible for the torts of the corporation employed by it, may carry such consequences.

Crane, Ch. J., O’Brien and Hitbbs, JJ., concur with Loughran, J.; Lehman, J., dissents in opinion in which Finch, J., concurs; Crouch, J., not sitting.

Judgment affirmed.


author: Finch, J. Lehman, J. (dissenting).

text:
    Fred H. Taylor et al., Appellants, v. United States Casualty Company, Respondent.
    (Argued November 18, 1935;
    decided January 7, 1936.)

      Adolph J. Rodenbeck and Maurice J. Kaman for appellants.
    The expression in the Insurance Law (Cons. Laws, ch. 28) “ legally using or operating ” a car, does not limit the defendant’s liability where permission has been given which has not been transgressed. (Devitt v. Continental Casualty Co., 245 App. Div. 115; Bakker v. Ætna Life

      Ins. Co., 264 N. Y. 150; Floyd v. Consolidated Indemnity Ins. Co., 237 App. Div. 190; Messersmith v. American Fidelity Co., 187 App. Div. 35; 232 N. Y. 161.) The driver of the car was not under the age fixed by law for licensing a driver, which was the only condition prescribed in the exclusion clause. (Imperial Fire Ins. Co. v. Coos County, 151 U. S. 452; United States F. & G. Co. v. Guenther, 31 Fed. Rep. [2d] 919; Brustein v. New Amsterdam Cas. Co., 255 N. Y. 137; Brock v. Travelers Ins. Co., 88 Conn. 308.)

      Charles S. Wilcox and Frederick T. Pierson for respondent.
    The operation of the car was in violation of the policy provisions. (Hawkeye Commercial Men’s Assn. v. Christy, 294 Fed. Rep. 208; Weiss v. Preferred Accident Ins. Co., 241 App. Div. 545; Letson v. Sun Indemnity Co., 147 Misc. Rep. 690; 241 App. Div. 629; Messersmith v. American Fidelity Co., 232 N. Y. 161; Devitt v. Continental Casualty Co., 154 Misc. Rep. 603; Wagoner v. Fidelity & Cas. Co., 215 App. Div. 170; 253 N. Y. 608; Morrison v. Royal Indemnity Co., 180 App. Div. 709; S. & E. Motor Hire Corp. v. N. Y. Indemnity Co., 255 N. Y. 69; Jones v. American Employers’ Ins. Co., 141 Misc. Rep. 88; Rohan v. Hartford Accident & Indemnity Co., 242 App. Div. 666; 266 N. Y. 545.)
   Finch, J.

This is a motion for summary judgment which was denied at Special Term. Upon appeal to the Appellate Division the order was affirmed by a divided court. Leave was thereupon granted by the Appellate Division to appeal to this court upon the certified question: Are the plaintiffs entitled to summary judgment on this record?”

The facts are undisputed and the appeal presents only questions of law.

The defendant insured one Charles H. Strong against, all claims which he should become legally liable to pay as damages arising out of bodily injuries accidentally sustained by any person or persons, caused by the ownership, maintenance and use of a Packard automobile owned by him. Harmon V. Strong, a son of Charles H. Strong, while operating the automobile with his father’s permission, was involved in a collision with an automobile containing the plaintiffs, injuring them. _ At the time the son, who was seventeen years of age and had a junior operator’s license, was returning home from a social visit. The hour at which the accident occurred was shortly after midnight. The plaintiffs brought separate actions against Charles H. Strong and his son, Harmon V. Strong. The defendant in this action, the United States Casualty Company, exercised its right under the policy of insurance to defend the actions, The actions were consolidated and the case was tried before a jury and verdicts for the plaintiffs rendered. Execution on the judgment was returned unsatisfied and the Strongs subsequently adjudged bankrupt. The plaintiffs then instituted suit against this defendant, the casualty company, on the policy of insurance issued by it to Charles H. Strong. The defendant interposed one defense, namely, the exclusion clause in the policy, reading as follows: “ This policy shall exclude any obligation of the Company: (a) under any of the above agreements, while any described automobile is being driven in any race or speed test, or by any person under the age fixed by law or under the age of fourteen years in any event.” (Italics interpolated.) It pointed out that the automobile was being operated in violation of the terms of the son’s junior operator’s license and the rules and regulations established by the Commissioner of Motor Vehicles, since it was being operated after midnight and not while traveling to or from school, nor in the ordinary pursuit of the business of the parent or guardian of the licensee, nor while accompanied by a parent, guardian, etc. On this state of facts, as set forth by the pleadings and affidavits, a motion for summary judgment was made by the plaintiffs. As noted, the motion was denied and the Appellate Division affirmed.

Taking up the exclusion clause, we find that the language employed is not applicable to the driver of the car in the case at bar. The policy provided that the motor vehicle should not be driven by one under “ the age fixed by law or under the age of fourteen years in any event,” The statute provides that no operator’s or chauffeur’s license shall be issued to any person under eighteen years of age, except that junior operators’ licenses may be issued to minors who have arrived at the age of sixteen years. (Vehicle and Traffic Law [Cons. Laws, ch. 71], § 20) A boy over sixteen years of age possessing a junior operator's license may lawfully drive an automobile, although the time during which he may drive is restricted. This boy was seventeen years of age and possessed a junior license. He was not, therefore, a person under “ the age fixed by law or under the age of fourteen years in any event." Why, then, does the defendant complain? Is it because the son violated the restrictions imposed on a junior licensee? The clause in the policy does not deal with the violation of the terms of a license. The provision relates solely to the question of age and the son was old enough lawfully to drive an automobile. If the insurance company desired the exclusion clause to cover not only a case where the driver is under the age fixed by law but also a case where the terms of the license are violated, it should have so specified. The court is nob at liberty to inject a clause into the policy or to make a new contract for the protection of the insurance company.

The same question arose in Brock v. Travelers Ins. Co. (88 Conn. 308), where the court held that this same exclusion clause related only to the question of age and not at all to violations, the court saying: “ The provision relates solely to the question of age, and not at all to the question of whether the operator has complied with the requirements of law.” A like result has been reached in other jurisdictions. (Mannheimer Bros. v. Kansas Casualty & Surety Co., 147 Minn. 350; Yorke v. Continental Casualty Company of Canada, [1929] 64 Ont. Law Rep. 109. Cf. Bitzer v. Southern Surety Co., 245 Ill. App. 295.)

The case of S. & E. Motor Hire Corp. v. New York Indemnity Co. (255 N. Y. 69) differed, in that the question raised therein was whether the insurance company had waived its defense, and in addition the exclusion clause involved in that case differed from the one in the case at bar. Nor is United States F. & G. Co. v. Guenther (281 U. S. 34) in point. That case decided that a municipal ordinance, prohibiting a minor under the age of eighteen years from operating a motor vehicle upon the streets of the city establishes an age limit fixed by law.”

If it be urged that the exclusion clause as drawn is at least ambiguous, then such ambiguity will be resolved against the insurer, under the principle of contra proferentem, or, in other words, the one who draws the contract and offers it should have the ambiguity resolved against him. (Gerka v. Fidelity & Casualty Co., 251 N. Y. 51; Marcus v. United States Casualty Co., 249 N. Y. 21.)

The order of the Appellate Division and that of Special Term should be reversed and summary judgment directed in favor of the plaintiffs, with costs in all courts.

The question certified should be answered in the affirmative.

Lehman, J. (dissenting).

The policy issued by the defendant insurance company to the owner of an automobile contained the provision required by the statute “ insuring such owner against- liability for damages for death or injuries to person or property resulting from negligence in the operation of such motor vehicle, in the business of such owner or otherwise, by any person legally using or operating the same with the permission, express or implied, of such owner.” (Insurance Law [Cons. Laws, ch. 28], § 109, subd. 3.) The policy also contained a provision that “ This policy shall exclude any obligation of the Company ■ (a) under any of the above agreements, while any described automobile is being driven in any race or speed test, or by any person under the age fixed by law or under the age of fourteen years in any event.”

The plaintiffs have recovered judgment against the insured for injuries resulting from negligence in the operation of his automobile, by his son who was driving the automobile with his permission. Execution has been returned unsatisfied and the plaintiffs now seek recovery upon the policy issued by the defendant. The accident occurred shortly after midnight. The operator of the car was a youth of seventeen. At that time he was returning to his father’s home from the city of Rochester, where he had been entertaining one of his friends at dinner.

The defendant denies liability on the sole ground that its policy did not insure the owner of the automobile against liability for damages suffered under such circumstances. It claims that the automobile at the time of the accident was being driven by a “ person under the age fixed by law ” and that even though the driver was using or operating the automobile with the permission of the owner,” he was not “ legally using or operating the same ” within the meaning of the statute and the policy.

There can I think be no doubt that in the operation of the automobile the driver was violating section 20 of the Vehicle and Traffic Law1. He had a junior operator’s license at that time, but operation of a motor vehicle under a junior license is subject to restrictions and the driver did not have any license which permitted him to operate the car at the time of the accident, and, since he was under the age of eighteen, he could not obtain such a license. Even so, the words “ legally using or operating ” as used in the statute and policy, do not exclude the operation of a motor vehicle in violation of a statutory provision enacted for the public safety. The provision of the policy is in the same language as section 109 of the Insurance Law, and is inserted in compliance with that section. Statute and policy must, therefore, receive the same construction. Section 109 of the Insurance Law uses the same language as section 59 of the Vehicle and Traffic Law, and its evident purpose is to enlarge the remedy provided by that section. That purpose would be to a considerable extent thwarted if its language were construed in a manner which denied the remedy where in the operation of a motor vehicle the operator violates a statutory provision intended for the promotion of the public safety. It seems evident to me that when the Legislature provided, in section 59 of the statute, a remedy against the owner of a motor vehicle for injuries suffered by any person from negligence in the operation of such motor vehicle by any person “ legally using or operating the same with the permission, express or implied, of such owner,” it did not intend to exclude cases, where illegality attached only to the manner in which the motor vehicle was operated or arose from the failure by the operator to comply in such operation with a command or condition imposed by the Legislature. Such violation of the statute would not constitute a defense to an owner of a motor vehicle for negligence in the operation of the vehicle in the owner’s business. The new remedy extended liability of an owner into a broader field. The statute should be construed accordingly. The limitation to legal use or operation was intended for the benefit of the owner. It should not be applied when the owner is a party to the violation of law.

The question still remains, however, whether liability here was excluded from the coverage of the policy because of the express provision in the policy, excepting from the obligation of the insurer, damages suffered while the automobile is being driven by any person under the age fixed by law.” It is provided in section 20 of the Vehicle and Traffic Law that: No operator’s or chauffeur’s license shall be issued to any person under eighteen years of age, except that junior operators’ licenses may be issued to minors who have arrived at the age of sixteen years, but who have not reached eighteen years of age, under rules and regulations to be established by the commissioner of motor vehicles, provided, however, that such license shall entitle a licensee to operate a motor vehicle * * * only, in traveling to and from school and in the usual and ordinary pursuit of the business of the parent or guardian of the licensee.” The operation of the motor vehicle during the night time violated the conditions of the driver’s junior operator’s license ” inserted in that license under the rules and regulations established by the Commissioner of Motor Vehicles. Moreover, the driver was at the time of the accident not operating the automobile in traveling to and from school [or] in the usual and ordinary pursuit of the business of the parent or guardian of the licensee.” Not only did the driver of the automobile not have a license permitting him to operate it at the time of the accident, but no person under the age of eighteen could have obtained such a license.

In other jurisdictions, similar provisions in policies excluding from the coverage of a policy the operation of a motor vehicle by a person “ under the age fixed by law ” have been construed, as Judge Finch points out, as relating “ solely to the question of age, and not at all to the question of whether the operator has complied with the law.” (Brock v. Travelers Ins. Co,, 88 Conn. 308.) Thus where a statute provides that no license shall be granted to a person under the age of eighteen, but sanctions the operation of an automobile by an unlicensed driver, though under that age, if accompanied by a licensed operator, it has been held that the age fixed by law ” is the age at which a person might lawfully operate the automobile upon compliance with the conditions imposed by statute. Then where an unlicensed operator operates an automobile unaccompanied by a licensed operator, the age of the operator is irrelevant. His operation of the automobile is unlawful, regardless of his age, solely because he is not accompanied by a licensed operator. (Brock v. Travelers Ins. Co., 88 Conn. 308; Mannheimer Bros. v. Kansas Casualty & Surety Co., 147 Minn. 350; Bitzer v. Southern Surety Co., 245 Ill. App. 295, but cf. Yorke v. Continental Casualty Company of Canada, 64 Ont. Law Rep. 109.)

The statute in this State is different. It not only prohibits the issuance to any person under the age of eighteen years of any license not subject to restrictions imposed by the statute or the rules and regulations issued pursuant to the statute, but it goes further and provides that no person shall operate or drive a motor vehicle upon a public highway of this state unless he is duly licensed under this chapter,” and the only exception permitted by the statute is that any person of a proper age to receive a license to drive a motor vehicle who desires to fit himself to so drive may operate and drive a motor vehicle within the state for a period of three months from the date of issuance to him of a learner’s permit. * * *

The holder of a learner’s permit shall not operate or drive a motor vehicle unless at all times under the immediate supervision and control of a driver duly licensed under this article.” (Vehicle and Traffic Law, § 20, subd. 4.) Thus, it appears that, under the terms of the statute and the rules and regulations issued in accordance therewith, no person under the age of eighteen years could under any circumstances or under any conditions, whether alone or accompanied by a licensed operator, lawfully drive a motor vehicle at night or for his own pleasure or purpose. Then the age of eighteen is the age fixed by law for such operation, and operation by a younger person is operation by a person “ under the age fixed by law.” No case has been cited where the court has reached other conclusion; indeed the reasoning of all the cases cited in the opinion of Judge Finch would seem to bar any other conclusion.

The judgment should be affirmed, with costs.

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

Judgment accordingly.


author:
Lehman, J.
      Finch, J.

text:
    In the Matter of John T. Mullane, Respondent, against John McKenzie, as Commissioner of Docks of the City of New York, et al., Appellants.
    (Argued November 20, 1935;
    decided January 7. 1936.)

      Paul Windels, Corporation Counsel (.Arthur B. Hoff, Jr., and Paxton Blair of counsel), for appellants.
    The question of the applicability of section 23 of the Civil Service Law (Cons. Laws, ch. 7), as amended by chapter 734 of the Laws of 1935, is, as to the petitioner, res adjudicata. (Luce v. N. Y., C. & St. L. R. R. Co., 213 App. Div. 374; 242 N. Y. 519; Blair v. Bartlett, 75 N. Y. 150; Matter of Rheingold v. Delaney, 245 App. Div. 706.) Section 23 of the Civil Service Law, as amended, should not be construed retroactively to upset rights vested by court order. If construed as retroactive the section would be unconstitutional. (Feiber Realty Corp. v. Abel, 265 N. Y. 94; Matter of Barmonde v. Kaplan, 266 N. Y. 214; Matter of Deth v. Castimore, 245 App. Div. 156; Matter of Dieter v. Ryan, 267 N. Y. 594; Matter of Nagelberg v. Finegan, 267 N. Y. 632; Matter of Guarino v. Anderson, 259 N. Y. 93; Stemmler v. Mayor, 179 N. Y. 473; People ex rel. Waddy v. Partridge, 172 N. Y. 305; Matter of Mahon v. Board of Education, 171 N. Y. 263; Matter of Chapman v. City of New York, 168 N. Y. 80; Weston v. State, 262 N. Y. 46; People v. Westchester County Nat. Bank, 231 N. Y. 465; Rosalsky v. State, 254 N. Y. 117; People ex rel. Rice v. Graves, 242 App. Div. 128.)

      John B. Doyle for respondent.
    Under section 23 of the Civil Service Law, as amended by section 734 of the Laws of 1935, the respondent has a clear and conclusive statutory right to the relief granted, and the new law as applied in the order appealed from is constitutional. (Matter of Deth v. Castimore, 245 App. Div. 156; Matter of Howard v. Higgins, 245 App. Div. 154; Matter of Rheingold v. Delaney, 245 App. Div. 706; Town of Guilford v. Board of Supervisors, 13 N. Y. 143; Matter of Borup, 182 N. Y. 222; People ex rel. Central Trust Co. v. Prendergast, 202 N. Y. 188; Munro v. State, 223 N. Y. 208; Babcock v. State, 190 App. Div. 147; 231 N. Y. 560; Williamsburg Sav. Bank v. State, 243 N. Y. 231; Farrington v. State, 248 N. Y. 112; Jackson v. State, 261 N. Y. 134; Matter

      of Evans v. Berry, 262 N. Y. 61; Howard v. Daly, 61 N. Y. 362; Milage v. Woodward, 186 N. Y. 252.) The previous orders appealed from, in effect refusing respondent back pay, and affirmed by the Appellate Division, are not res adjudícala against the respondent. (Fox v. Employers Liability Assur. Corp., 239 App. Div. 671; Marine Transit Corp. v. Switzerland General Ins. Co., 263 N. Y. 139.)

      Joseph T. Malone, amicus curiae.

    The Legislature has inherent power to pass remedial legislation, and where the intent and effect of the legislation is to right a wrong, to give relief where equity demands a remedy, or to satisfy the cry of conscience that legal sanction be given to a moral obligation, such legislation does not violate any provision of the Constitution, even though it be retroactive in effect, because it is the nature of remedial legislation to cure the past as well as to prevent the same wrong from happening again in the future. (People ex rel. Central Trust Co. v. Prendergast, 202 N. Y. 188; Matter of Deth v. Castimore, 245 App. Div. 156; Farrington v. State, 248 N. Y. 112.) The principle of res adjudícala cannot be applied where the demand is made under a statute expressly designed to give such relief, because the doctrine of res adjudícala not only demands that the subject-matter and the parties be the same or derive their authority from the same source, but that the prior judgment must have been one on the merits, and that the rights of the parties have not changed since the prior judgment. (Rose v. Hawley, 133 N. Y. 315; Reynolds v. Ætna Life Ins. Co., 160 N, Y. 635; Palmer v. Hussey, 87 N. Y. 303; Lindenthal v. Germania Life Ins. Co., 174 N. Y. 76; Wrought Iron Bridge Co. v. Town of Attica, 119 N. Y. 204; Steel Co. v. Erskine, 98 Fed. Rep. 215; Pennsylvania v. Wheeling & B. Bridge Co., 18 How. 421; Howell v. City of Buffalo, 37 N. Y 267; City of Chelsea v. Dolan, 24 Fed. Rep. [2d] 522; Slate of Wisconsin v. Torinus, 28 Minn. 175; Mackenzie v. Douglas Co.. 91 Ore. 375; Matter of Pomeroy, 51 Mont. 119; Knights of Pythias v.
      Meyer, 265 U. S. 30; Quanah, A. & P. Ry. Co. v. Panhandle & S. F. Ry. Co., 67 Fed. Rep. [2d] 826; McGillis v. McGillis, 154 N. Y. 532; State ex rel. School Dist. v. Clausen, 109 Wash. 37.)

      Albert De Roode for William A. Carroll, amicus curice.

    The rule against double payment by the city is a rule of law creating nothing in the nature of a vested right on the part of the city to have it remain unaltered. (Matter of Barmonde, 266 N. Y. 214; Martin v. City of New York, 176 N. Y. 371; Preston Co. v. Funkhouser, 261 N. Y. 140; 290 U. S. 163; Deuscher v. Cammerano, 256 N. Y. 328; Ward v. Iroquois Gas Corp., 258 N. Y, 124.) Chapter 734 of the Laws of 1935 does not offend the Constitution. (Matter of Deth v. Castimore. 281 N. Y. Supp. 114.)
   Lehman, J.

The petitioner was removed from his position as dockmaster on May 16, 1934, in violation of his rights under the Civil Service Law (Cons. Laws, ch. 7). He was reinstated by order of mandamus dated October 26th. During the interval the salary which should have gone to him was paid to another, who though younger in service was retained by the city in the position to which the petitioner was entitled. The order of reinstatement contained a direction for the payment by the city of the same salary to the petitioner. Before that direction was obeyed, this court in Matter of Barmonde v. Kaplan (266 N. Y. 214), pointed out that under long-established rules of law the city was under no obligation to pay the salary, attached to a position, to the person who was rightfully entitled to such position, where it had already paid the same salary to another, who actually, though without right, occupied the position and performed its duties. Then upon a motion made at Special Term to resettle the order for the petitioner’s reinstatement, the provision for the payment of salary to the petitioner was stricken out.

Thereafter, by chapter 734 of the Laws of 1935, the Legislature amended section 23 of the Civil Service Law to provide that any officer or employee who shall have been, or may hereafter be removed ” from his position in violation of any provision of this chapter [the Civil Service Law],” and thereafter restored to his position by order of the Supreme Court, should be entitled to receive the same compensation from the date of his removal to the date of his restoration which he would have received in such position, but for such unlawful removal, less the amount of any compensation received from any other employment or occupation during that period. Thus by change in the law the Legislature has conferred upon officers and employees in the civil service a right to compensation which the law had theretofore denied to them.

The petitioner does not now challenge the order of resettlement which denied him the right which he at that time asserted. The law, as it then was, dictated such denial. Now he asserts a new statutory right. The earlier decision may be a conclusive adjudication of the petitioner’s rights, existing then; it cannot be an adjudication of rights thereafter conferred by law, or bar a new proceeding to vindicate new rights.

It is clear that the Legislature intended to confer this new right retroactively upon those who shall have been * * * removed,” as well as prospectively upon those who “ may hereafter be removed.” Though, ordinarily, legislation creating new rights and obligations is intended to have only prospective application, yet within a limited field where no provision of the Constitution of the State or the United States restricts the powers of the Legislature, statutes which are clearly intended to have retroactive effect may be so applied. New rights may have their roots in old relationships. The question here is whether the Legislature in attempting to confer a new right upon officers and employees who had theretofore been removed in violation of the Civil Service Law, exceeded its powers as limited by the Constitution.

Until the statute was enacted, the city was under no obligation to pay to the petitioner the compensation it has been directed to pay to him. Under the statute, compensation is to be paid as part of the emoluments of the petitioner’s office, or for loss theretofore suffered by reason of a completed wrong. If it is regarded as extra compensation to a public officer or servant, section 28 of article III of the Constitution bars the Legislature from granting it. If it is regarded as a gift of public moneys, section 10 of article VIII is violated. We are told, however, that it is neither extra compensation nor gift, but an appropriation of public moneys to meet a moral obligation. That is the problem presented upon this appeal.

By constitutional mandate, the principle that appointments and promotions in the civil service of the State shall be based upon merit, and that the civil servants of the State shall have security of tenure, is firmly embodied in the public policy of the State. The Legislature rests under the duty of giving effect to this mandate by appropriate legislation. The removal of the petitioner violated provisions of the Civil Service Law and, even if made in good faith because of mistaken interpretation of complicated rules, it was a wrongful act, which deprived the petitioner of the benefits and emoluments of his office. The law provided a remedy by which the petitioner could be restored to his position; it did not permit recovery of the salary attached to the position where such salary had been paid to another. To that extent the Civil Service Law failed to confer upon officers and employees of the State or municipal corporations all the benefits of complete security of tenure. The common law had imposed no obligation to pay such salary upon the State or a, municipal corporation, and the Legislature had not created such obligation. Under the recent amendment of the statute, the benefit of security of tenure in office or position is made more complete. Now it includes the right to demand and receive, as damages for a wrongful removal, the compensation which, but for such removal, an employee would have earned and received. It cannot be doubted that the Legislature had power to provide that in the future such a right should be attached to tenure of office. There the Legislature’s discretion in determining the rights and benefits which should attach to an office]or position in the civil service and in determining how security of tenure shall be safeguarded is almost plenary. Then public moneys are used to meet the obligations to officers and employees in the civil service, which the Legislature could impose upon the State and municipal corporations. They are not used in any sense as a gift.

The situation is different when the Legislature provides that public moneys shall be used to pay to holders of office or positions, salaries or compensation for a period during which the State or municipal corporation was under no legal obligation to pay such salary. That is what the Legislature has attempted to do when it provided that persons “ who shall have been * * * removed from any position * * * and who shall have been restored to such position or employment ” may enforce payment of salary or compensation during the interval between removal and restoration. Such provision is on its face a gift of public moneys, unless there was a moral obligation to pay, even though no legal obligation may exist.

We assume that the Legislature has determined that such a moral obligation did exist here. “ The decision by the Legislature that certain facts create a moral obligation, even if those facts exist, is not conclusive. The courts will still be called upon to decide whether its judgment was correct.” (Williamsburgh Sav. Bank v. State, 243 N. Y. 231, 241.) It is said that the wrongful removal of a public servant "unjustly prevents him from enjoying the emoluments of his position. The injustice of depriving an employee of the emoluments of a position, to which he is legally entitled, and which have wrongfully been withheld, from him by the illegal and arbitrary act of his superior, is apparent at a glance.” (Matter of Deth v. Castimore, 245 App. Div. 156, 163.) Such injustice ” may have been a cogent factor in inducing the Legislature to create an obligation to pay to them all emoluments withheld because of their wrongful removal. It cannot free the Legislature from the restrictions placed by the Constitution upon its powers when it attempts to use public moneys to remedy that “ injustice,” in cases where no legal obligation to pay existed at the time when payment was withheld.

The injustice must be real, and even then the remedy may not be through the grant of extra compensation to a public officer, servant, agent or contractor. Such terms as •' moral obligation ’ and obligations ‘ founded on justice and equity ’ are flexible. They serve to formulate the problem rather than to provide the formula by which the problem may be solved. No yardstick has ever been devised which can be mechanically applied. None the less, in every case there must exist an obligation which would be recognized, at least, by men with a keen sense of honor and with real desire to act fairly and equitably without compulsion of law.” (Ausable Chasm Co. v. State, 266 N. Y. 326, 330.) Because of the petitioner’s removal, he lost the right to receive from the city the compensation which he might otherwise have earned. After payment in good faith to another, the city was no longer under any obligation to pay compensation to the petitioner. When the city then withheld such payment, it was acting in accordance with its legal rights, and it may be doubted whether that can be called “ wrongful; ” and whether the term moral obligation,” however flexible, could be stretched to cover such a situation, even if the Constitution had left the Legislature free to use the public moneys to meet a moral obligation ” of the State towards a public officer, servant, agent or contractor.

' In that field the Constitution has imposed upon the Legislature a more inflexible restriction. A keen sense of honor and a real desire to deal fairly and equitably without compulsion of law might; at times, impel a private person to grant to a servant or contractor compensation beyond the amount which by agreement he was bound to pay. The Constitution of the State forbids the Legislature from granting any extra compensation (Art. Ill, § 28). There the mandate is absolute, regardless of conditions or circumstances. It is said that in this case the Legislature did not grant extra compensation to a public servant, but merely provided that he should receive the compensation previously fixed by law, to which he would have been entitled except for his wrongful removal, and in effect imposes damages for a wrong committed by the State or a municipality. Such distinctions would defeat the plain intent of the constitutional restriction. That is imposed for the protection of the public against misapplication of the public moneys. The Legislature may not use these moneys for the payment of compensation to a public servant where the servant is not entitled by law to such compensation. A payment of compensation to a public servant constitutes extra compensation whenever there is no legal obligation to pay such compensation. The Legislature has attempted to impose upon the city an obligation to pay its servant compensation during a period when such servant has been ousted from his office and has performed no services for which the city was liable. A statute requiring a city to pay its public money for a service never rendered and for which it was not liable, falls within the inhibition of the provisions of the Constitution.” (Stemmler v. Mayor, 179 N. Y. 473, 483.)

The order of the Appellate Division should be reversed and that of the Special Term affirmed, without costs.

Finch, J.

(dissenting). I am unable to concur for it seems to me that there is not only a moral obligation to pay the incumbent who has been wrongfully removed, but the situation is such that if private individuals were involved, there would also be a legal obligation by way of damages for the breach. (Howard v. Daly, 61 N. Y. 362, 371; Milage v. Woodward, 186 N. Y. 252, 257.) Such legal obligation would be implicit in the finding of the court that the incumbent has'been ousted contrary to law. The State or subdivision thereof would be liable had not the court absolved the public authorities from liability to pay over again to the wrongfully ousted claimant. (Matter of Barmonde v. Kaplan, 266 N. Y. 214.) The Legislature to its credit has now held the public authorities to as high a standard of morality and justice as demanded of the private individual. This is as it should be. The expressed intention and purpose of the Legislature being to give the statute a retroactive application (Jacobus v. Colgate, 217 N. Y. 235, 240; Hallenbach v. Born, 238 N. Y. 34, 38), and a claim existing founded in equity and justice (Town of Guilford v. Board of Supervisors, 13 N. Y. 143, 149), the statute is constitutional. Contrary statements to be found in Stemmier v. Mayor (179 N. Y. 473) are dicta.

The respondent was wrongfully removed, rightfully reinstated, has not been reimbursed, and had no opportunity to receive any other compensation during the period he was out of office.

I vote to affirm.

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

Ordered accordingly.


author: Lehman, J.

text:
    In the Matter of Baltimore Mail Steamship Company, Appellant, against Lewis L. Fawcett, as a Justice of the Supreme Court of the State of New York, et al., Respondents.

      (Argued November 18, 1935;
    decided January 7,1936.)

      Raymond Parmer and Vernon S. Jones for appellant.
    The “ exercise of discretion ” by the Appellate Division is not a bar to this appeal. The Court of Appeals has power to review the question. (Matter of Reynolds v. Cropsey, 241 N. Y. 389.) The courts of New York have no jurisdiction of the subject-matter of the action. (Davis v. Farmers Co-operative Co., 262 U. S. 312; Atchison, T. & S. F. Ry. Co. v. Wells, 265 U. S. 101; Michigan Central R. R. Co. v. Mix, 278 U. S. 492; Denver & Rio Grande Western Ry. Co. v. Terte, 284 U. S. 284; International Milling Co. v. Columbia Co., 292 U. S. 511; Brood en Beschuitfabriek v. Aluminum Co., 231 App. Div. 693; Panstswowe Zaklady Graviozne v. Automobile Ins. Co., 36 Fed. Rep. [2d] 504; Guerin Mills v. Barrett, 254 N. Y. 380.) Only by an order of prohibition can the appellant be protected from the oppressive and unreasonable burden of trying the case in New York, which the Constitution prohibits (Denver & Rio Grande Western Ry. Co. v. Terte, 284 U. S. 284.)

      Simone N. Gazan for respondents.
    After the court overruled the defendant’s motion, it could properly have then sought an order of prohibition to prevent the court from exercising jurisdiction, but having elected to appeal, and such appeal having afforded the defendant a review of the question sought to be raised, the right to prohibition thereby became lost because appeal was an effective remedy and the defendant could not have both appeal and prohibition. (Matter of Kohn v. Domestic Relations Court, 244 App. Div. 829; Matter of Farley v. Weil, 63 Misc. Rep. 188; People ex rel. New York Disposal Corp. v. Freschi, 173 App. Div. 189.)
   Lehman, J.

Baltimore Mail Steamship Company is a corporation organized under the laws of Maryland. It is engaged solely in interstate and foreign commerce. It operates five steamships for the transportation of passengers, mails and cargo between the ports of Baltimore, Maryland, and Norfolk, Virginia, and between those ports and Havre in France and Hamburg and Bremen in Germany. Michael Madsen was injured while working as a seaman on a steamship operated by Baltimore Mail Steamship Company. At the time of the accident the steamship was lying at a pier at Norfolk, Virginia. Madsen thereafter became a resident of the State of New York and began in this State an action against Baltimore Mail Steamship Company to recover damages caused by the injury suffered on its steamship.

Baltimore Mail Steamship Company moved in the Appellate Division for an order of prohibition against any further proceedings in the action. It claimed that prosecution of the action in this State will impose an oppressive and unreasonable burden upon the interstate and foreign commerce in which it is engaged, in contravention of Article I, Section 8, of the Constitution of the United States, and that by reason of that fact the courts of the State of New York have not jurisdiction over the subject matter of the action.” The motion was denied, and Baltimore Mail Steamship Company now appeals to this court as of right, on the ground that the construction of the Constitution of the United States is directly involved in the proceeding.

At the outset the question arises whether we have any jurisdiction to review the order of the Appellate Division, which recites that the “ motion for an order of prohibition be and the same hereby is denied in the exercise of discretion.” We may not review the discretion of the Appellate Division where there is room for the exercise of discretion. We have said in People ex rel. Cuvillier v. Hagarty (238 N. Y. 621) that the writ of prohibition does not issue as a matter of right but in the sound discretion of the court ” (citing cases), and that the order of the Appellate Division refusing to grant it is not appeal-able to this court unless the order or the opinion shows that the application was denied as a matter of law and not in the exercise of discretion. Upon an application for a writ or order of prohibition “ the sole question to be tried is the power of the inferior court or magistrate to do the particular act in question. * * * It is justified only by extreme necessity ’ when the grievance cannot1 be redressed by ordinary proceedings at law, or in equity, or by appeal ’ ” (citing cases). (People ex rel. Livingston v. Wyatt, 186 N. Y. 383, 393, 394.) A decision or order of a court or magistrate acting without jurisdiction is void, and though, until reversed or vacated, it may cause annoyance or even damage, such grievances may, as a general rule, be redressed by the ordinary remedies of appeal, motion to vacate, or habeas corpus proceedings. Such remedies may, it is true, be inconvenient, and, at times, incomplete. The consequences of judicial error are not entirely erased, though the error be subsequently corrected; the consequences of judicial usurpation may be serious and, in part, irremediable by subsequent rebuke. The writ of prohibition was devised to halt a threatened judicial usurpation of jurisdiction before it causes damage. “ It is in effect an injunction against a court ” (People ex rel. Livingston v. Wyatt, supra), and upon an application for an order or writ of prohibition, as upon an application for an injunction, there may be room for the exercise by the court of discretion whether to grant the extraordinary remedy which would prevent a threatened wrong, or to withhold its arm at that time and remit a suitor to the less convenient and less complete remedies provided by the ordinary proceedings at law, or in equity, for redress of such wrong. It is in that sense that “ it is often said that the granting or refusing of a writ of prohibition is discretionary, and therefore not the subject of a writ of error ” (Smith v. Whitney, 116 U. S. 167, 173), and it is only in that sense that we have referred to orders denying a wri b or order of prohibition as discretionary and not the subject of an appeal to this court. What we have said cannot be applied to cases where the question of jurisdiction is not doubtful, and there is no remedy except prohibition available. Then there, is no room for the exercise of discretion, and an order granting or denying the remedy of prohibition is reviewable on appeal. (Cf. Smith v. Whitney, supra; Farquharson v. Morgan, [1894] 1 Q. B. 552; High on Extraordinary Legal Remedies [3d ed.], § 773-a.)

We need not now attempt a general definition of the limits of judicial discretion. Doubtless the cases are rare where there is no element of discretion. At least in those rare cases where a writ or order of prohibition is the only available remedy against invasion of a right guaranteed by law, a refusal to grant that remedy is in effect a denial of the right. The appellant here contends that under the Constitution of the United States the exercise of jurisdiction by the courts of this State in the action brought against it here would violate a right guaranteed by the Constitution of the United States. Since the State itself cannot deny rights guaranteed by the Constitution of the United States, it is evident that the courts of this State must give protection to such a right. Refusal of the only possible means of protection of a constitutional right cannot, then, be. justified upon the ground that it was made in the exercise of discretion. It is not within the power of a State to so regulate the jurisdiction of its courts as to prevent the effective assertion of a constitutional right. (Cf. Kentucky v. Powers, 201 U. S. 1.) At least where an application for an order of prohibition shows conclusively that only by such order can its clear constitutional rights be protected, the order must issue as of right, and the recital in an order, denying the application, that it is made in the exercise of discretion ” is without effect. For these reasons the order is appealable to this court. _

The general jurisdiction of the courts of this State extends to transitory causes of action arising in another jurisdiction, even though the plaintiff may not have been a resident of this State when the cause of action arose, and the defendant may be a foreign corporation. (Gregonis v. Philadelphia & Reading Coal & Iron Co., 235 N. Y. 152.) The general jurisdiction of the courts of a State is confined to the field from which the State itself is not excluded under the provisions of the Constitution. The appellant maintains a bank account in this State for its convenience in conducting its business of transportation by sea in interstate and foreign commerce. Perhaps it solicits traffic or freight here. Otherwise it has no property and engages in no activities here. Its steamships do not enter any port in this State or even pass through the waters along its shores. Though the appellant is incorporated in the State of Maryland and derives its authority to engage in interstate commerce from the laws of that State, it may not be prevented by another State from coming into its limits ” (Western Union Tel. Co. v. Kansas, 216 U. S. 1, 27), nor may another State impose unreasonable or oppressive burdens upon its property or activities here.

Litigation against carriers in states and jurisdictions remote from that in which the cause of action arose entails absence of employees from their customary occupations; and [that] this impairs efficiency in operation, and causes, directly and indirectly, heavy expense to the carriers.” (Davis v. Farmers Co-operative Equity Co., 262 U. S. 312, 315, 316, 317.) True, the court pointed out there that “ the fact that the business carried on by a corporation is entirely interstate in character does not render the corporation immune from the ordinary process of the courts,” even where the result may be some obstruction of its business; but such obstruction should not go further than the reasonable requirements of orderly and effective administration of justice, and it was held that orderly, effective administration of justice clearly does not require that a foreign carrier shall submit to a suit in a state in which the cause of action did not arise, in which the transaction giving rise to it was not entered upon, * * * in which the plaintiff does not reside,” and that the general jurisdiction of a State over transitory causes of action does not include jurisdiction of the subject of such an action brought under those conditions against a foreign corporation, engaged in the business of a carrier in interstate commerce.

In the recent case of International Milling Co., v. Columbia Transportation Co. (292 U. S. 511) a similar contention was made by a carrier engaged in interstate commerce, and in the opinion of the court by Mr. Justice Cardozo all the intervening decisions of the Supreme Court have been collated. In all these cases the test has been whether the exercise of jurisdiction by a State court of the subject of a transitory action brought against a foreign corporation engaged in interstate commerce, would impose a serious and unreasonable burden upon interstate commerce. In course of time, by process of inclusion and exclusion, the standard or measure to be applied has become clearer. The group of cases where the exercise of jurisdiction has been denied, and the group where jurisdiction has been sustained, “ are clearly marked, and also the reasons for the grouping.” (International Milling Co. v. Columbia Transportation Co., supra, p. 519.)

A repetition of the analysis of the cases there collated would serve no purpose. In none of these cases did the court base its decision upon any single factor. In the cases where jurisdiction was denied, the cause of action arose in another State, the defendant was an interstate railroad, which had no tracks and did no business other than soliciting traffic in the State where it was sued, and the plaintiff at the time the cause of action arose was not a resident of that State (Davis v. Farmers Co-operative Equity Co., 262 U. S. 312; Atchison, T. & S. F. Ry. Co. v. Wells, 265 U. S. 101; Michigan Central R. R. Co. v. Mix, 278 U. S. 492, and Denver & Bio Grande Western R. R. Co. v. Terte, 284 U. S. 284), though in Michigan Central B. B. Co. v. Mix (supra) the plaintiff became a resident before the action was brought. In the cases where the jurisdiction of the State court was sustained there were factors present which dictated the conclusion that orderly and effective administration of justice required the carrier to submit to suit in the State where the action was brought. Thus, in Missouri ex rel. St. Louis, B. & M. Ry. Co. v. Taylor (266 U. S. 200) the exercise of jurisdiction by the courts of Missouri was sustained where the cause of action was for damages to freight shipped from Texas to Missouri to a consignee resident there, and the negligence of the connecting carrier may have occurred in that State. In International Milling Co. v. Columbia Transportation Co. (supra) the plaintiff, though a Delaware corporation, had its principal place of business in Minnesota where the action was brought, and the defendant, though a Delaware corporation, engaged in interstate commerce by water, was engaged in transportation in Minnesota as much as in other States; and in Denver & Bio Grande Western B, B. Co. v. Terte (supra), though the exercise of jurisdiction was denied to the courts of Missouri in an action for injuries suffered in Colorado brought against a foreign railroad corporation which operated no railroad in Missouri, it was sustained against another defendant, a foreign corporation which had parts of its line in that State.

In the action brought by Madsen against this appellant, no circumstance exists which would justify a conclusion that the defendant may reasonably be compelled to submit to a suit here. The accident occurred in another State; the defendant carries on no activities here except to solicit business for commerce which does not touch this State. The plaintiff was not employed in this State or resident here when the cause of action arose. Thus the exercise of jurisdiction in the negligence action by the courts of this State would be an unreasonable burden upon the business of interstate and foreign commerce conducted by the defendant, which is not warranted by the requirements of orderly, effective administration of justice.”

The question remains whether an application for an order of prohibition is the only proceeding left open to the appellant for the assertion of its rights, and whether a denial of that application is in effect a denial of appellant’s constitutional rights. The appellant has previously unsuccessfully challenged the jurisdiction of the courts of this State by motion to dismiss the complaint made after a special appearance for that purpose. That motion was denied, and upon appeal the Appellate Division affirmed the order denying the motion and refused leave to appeal to this court. The decision upon the motion to dismiss the complaint does not preclude the defendant from objecting thereafter on the same grounds to the jurisdiction of the court, even though that decision has not been reversed upon appeal. A court without jurisdiction of the subject-matter of an action can acquire no jurisdiction by erroneous decision that it has jurisdiction. (Cf. Bank of Jasper v. First Nat. Bank, 258 U. S. 112.) A judgment thereafter rendered by default is void (Guerin Mills v. Barrett, 254 N. Y. 380), and a defendant may raise and reiterate the objection of want of jurisdiction at any stage. (Robinson v. Oceanic Steam Nav. Co., 112 N. Y. 315.) The defendant may even appear generally and reiterate the objection in the answer. (Toledo Railways & Light Co. v. Hill, 244 U. S. 49.)

The carrier’s grievance here is not that a judgment against it, granted by a court without jurisdiction, would be void and unenforceable under the due process ” clause of the Constitution. (Cf. Davis v. Farmers Co-operative Equity Co., supra.) If that were all, the ordinary proceedings of motion to vacate the. judgment or of appeal from the final judgment, bringing up for review the interlocutory order denying its motion to dismiss, might furnish a remedy, though incomplete, and the Appellate Division might perhaps in the exercise of discretion refuse to decide the question of whether the trial court has jurisdiction until after that court has rendered judgment. The carrier’s grievance here is that the defense of a cause of action for negligence in a State remote from the place where the alleged negligence occurred and remote from the place where it carries passengers or goods, constitutes an unreasonable burden upon its business of transportation. It challenges the right of the State to seize its property here and to compel it to defend such an action here. Answer to that challenge cannot be postponed till after trial, for then a belated decision that the courts of the State had no right to compel a carrier to defend an action would furnish no protection to the defendant’s constitutional immunity from the burden of such a defense.

By motion to dismiss made in the action brought against it and by appeal from the order of denial, the appellant had exhausted all the ordinary remedies offered by the procedure of this State for the protection of the appellant’s constitutional rights. Then only the extraordinary remedy of prohibition remained open. The way was not barred by the adverse decision of the motion made on the same ground. (Cf. Denver & Rio Grande Western R. R. Co. v. Terte, supra.) The ordinary and extraordinary remedies provided by law for the protection of the appellant’s rights are not based on inconsistent theories; indeed, perhaps, an attempt to invoke the extraordinary remedy of prohibition might have been futile so long as it did not appear that the same relief could not be obtained by tile ordinary remedy of motion in the action.

In that case (Denver & Rio Grande Western R. R. Co. v. Terte, supra) no appeal was taken from the order denying the motion in the action before the defendant applied for a writ of prohibition. Under the practice and procedure of the State of Missouri, where the action was brought, no appeal can be taken from such an interlocutory order in an action until after final judgment. Here, as we have said, an appeal was taken to the Appellate Division and the order was affirmed; leave to appeal was denied by the Appellate Division, and under our practice and procedure no further appeal could then be taken to this court. Now it is urged that even though it has been authoritatively determined that a motion made in an action to vacate the process of the court or to dismiss a complaint does not bar subsequent application for an order of prohibition upon the same grounds, yet that when the motion has been denied, an appeal from the order of denial is inconsistent with and bars a subsequent application for an order of prohibition.

The jurisdiction of the courts of this State rests upon law, both statutory and constitutional. Erroneous decision as to its own jurisdiction of the subject of an action rendered by a court without jurisdiction is, as we have said, entirely void and has no conclusive effect upon the parties to the action, though the court might have jurisdiction of their persons. Here there is no room for distinction between final and interlocutory decisions or between decisions of a trial court and decisions of an appellate court affirming or reversing the trial court. The appellant here is not seeking a second review of the order denying its motion made in the action. It is seeking an extraordinary remedy where the ordinary remedy of appeal has been exhausted.

It is said, however, that after the appellant sought the remedy of appeal, it was bound to pursue that remedy as far as it could before it applied for an order of prohibition. We assume for the purposes of this appeal that the appellant has no absolute right to an order of prohibition unless it has exhausted its remedy by appeal. It has certainly exhausted every remedy by appeal now open to it under the laws of this State, but it is said that it did not seek a review by the Supreme Court of the United States of the order of affirmance of the Appellate Division. The order of the Appellate Division was not final under the procedure of this State, and no decision of the Supreme Court of the United States has been called to our attention which indicates that the order of the Appellate Division would be regarded by the Supreme Court as final for purposes of review. (Cf. Meagher v. Minnesota Thresher Mfg. Co., 145 U. S. 608;. Kentucky v. Powers, 201 U. S. 1.) It is difficult to see how the question of whether or not the decision of the Appellate Division was reviewable by the Supreme Court of the United States can affect the powers or discretion of the courts of this State. Such review is for the purpose of correcting an error of the courts of the State in regard to a right, privilege or immunity claimed under the Constitution and laws of the United States. It does not constitute part of the procedure of the courts of this State, and it would be anomalous to hold that the courts of this State are justified in denying to a suitor protection against encroachment by the State upon his rights guaranteed by the Constitution because the suitor has chosen to exhaust the remedies provided by State law before he asks the Supreme Court of the United States to correct an error of the courts of this State. The extraordinary remedy of prohibition may be invoked as of right when other remedies provided by the law of this State are not available or have been unsuccessfully invoked as protection against a threatened invasion by the State of constitutional rights. The State may not deny such rights, and a suitor,claiming such rights here may not be relegated by the State to a Federal court for the protection of such rights.

The order of the Appellate Division should be reversed, with costs in. all courts, and the application granted.

Crane, Ch. J., O’Brien, Hubbs, Crouch, Loughran and Finch, JJ., concur.

Ordered accordingly.


text:
    The People of the State of New York ex rel. Henry Hirschberg, as District Attorney of Orange County, Respondent, against The Supreme Court of the State of New York et al., Appellants.
    Argued November 19, 1935;
    decided January 7, 1936.)

      Harry S. Travis for appellants.
    The Supreme Court had jurisdiction of the motion to inspect the grand jury minutes notwithstanding the removal of the cause to County Court under subdivision 6 of section’22 of the Code of Criminal Procedure. (People v. Naughton, 38 How. Pr. 430; People v. Steinhardt, 47 Misc. Rep. 252; People v. Shattuck, 6 Abb. [N. S.] 33; People v. Van Horne, 8 Barb. 158; People v. Hylan, 2 Park. Crim. Rep. 570; People v. Strong, 1 Abb. [N. S.] 244; Matter cf Steinway, 159 N. Y. 250; Jones v. People, 79 N. Y. 45; People ex rel. Swann v. Court of General Sessions, 115 Misc. Rep. 454.)

      Henry Hirschberg, District Attorney, for respondent.
    While the indictment was pending in the Orange County Court the Supreme Court was without jurisdiction to make the proposed order for inspection of the grand jury minutes. (People v. Salamone, 221 App. Div. 758; Real v. People, 42 N. Y. 270; Hunley v. State, 105 Ga. 686; Towns v. State, 111 S. E. Rep. 692; Cook v. State, 10 Ga. 580; Lord Mohun’s Case, 1 Salk. 103; Matter of Taylor, 5 Cow. 56; Eighmy v. People, 79 N. Y. 546; People v. Naughton, 36 How. Pr. 430; People v. Glen, 173 N. Y. 395; People v. Sexton, 187 N. Y. 495; People v. Sweeney, 213 N. Y. 37; People v. Steinhardt, 47 Misc. Rep. 252; People ex rel. Swann v. Court of General Sessions, 115 Misc. Rep. 454; People ex rel. Newton v. Special Term, 193 App. Div. 463.)
   Lehman, J.

The appellant John W. Travis was indicted by the grand jury of Orange county in the Supreme Court for the crime of grand larceny. Then the indictment was transferred to the County Court of Orange county. There the defendant interposed a demurrer to the indictment, and after the demurrer was overruled, the defendant there pleaded not guilty and moved for a bill of particulars. Bis motion was granted. The defendant thereafter moved in the Supreme Court for an order permitting him and his counsel to inspect the minutes of the grand jury. The District Attorney appeared specially, for the purpose of challenging the jurisdiction of the Supreme Court, and then applied to' the Appellate Division for an order of prohibition. The application was granted.

The minutes of the grand jury are not part of the indictment. Indeed, at common law no written record of proceedings before a grand jury was kept. (See People v. Steinhardt, 47 Misc. Rep. 252.) The statute now provides that the grand jury must appoint one of their number as clerk, who is to preserve minutes of their proceedings * * * and of the evidence given before them.” (Code Crim. Proc. § 250.) The District Attorney of any county may appoint a stenographer to take the testimony given before the grand jury (Code Crim. Proc. § 952-p), and it is the duty of such stenographer to furnish to the district attorney of such county a full copy of all such testimony as such district attorney shall require, but he shall not permit any other person to take a copy of the same, nor of any portion thereof, nor to read the same, or any portion thereof, except upon the written order of the court duly made after hearing the said district attorney. All of the said original notes and minutes shall be kept in custody of said district attorney, and neither the same, nor a copy of the same, or any portion of the same, shall be taken from the office of said district attorney excepting as above provided.” (Code Crim. Proc. § 952-t.) Under these statutory provisions the minutes of the grand jury and the testimony of the witnesses are now available to the court, to the District Attorney, and, upon direction of the court, to other persons.

The right of an accused to move for the dismissal of an indictment based upon illegal or insufficient evidence is guaranteed by the Constitution. (People v. Glen, 173 N. Y. 395; People v. Sexton, 187 N. Y. 495.) The court has power, in its discretion, to permit an inspection of the minutes of the grand jury for the purpose of such motion. Indeed, where, as in this case, the indictment is in short form and merely names the crime without specification of time, place or other details, perhaps the minutes of the grand jury must be produced in order to identify the “ subject of the charge.” (Cf. People v. Bogdanoff, 254 N. Y. 16.) No such question is here raised. The District Attorney challenges now only the jurisdiction of the Supreme Court to grant the motion after the indictment has been removed to the County Court.

By such removal the County Court acquired jurisdiction to try and determine the indictment.” (Code Crim. Proc. § 39.) That jurisdiction is complete and includes motions directed to the sufficiency or validity of the indictment and other motions preliminary to the ' trial. A motion to inspect the minutes of the testimony given before the grand jury which found the indictment is not such a motion. The proceedings of the grand jury were in the Supreme Court, and the justice, presiding in that court, charged the jury, received its indictments when found, and, in general, was responsible for its conduct. That court remains in possession and control of the records of proceedings held there.

The order removing the indictment to the County Court pursuant to subdivision 6 of section 22 of the Code of Criminal Procedure did not remove to the County Court the record and minutes of the proceedings of the grand jury previously completed in the Supreme Court. They form no part of the indictment, though, in proper case, they may be used as evidence upon an attack directed against the indictment. Such evidence may be made available if the court where the proceedings were had directs that the record of the proceedings and the minutes of the evidence may be inspected or produced. Discretion is vested in that court.

The law requires that the secrecy of testimony given before the grand jury be kept inviolate, except upon the written order of the court,” duly made after hearing the District Attorney. That can mean only the court in which the proceedings were had and the testimony was taken. The court which had part in the proceedings can best determine whether the seal of secrecy should be broken. Nothing in the statute suggests that the court, to which the indictment was transferred should have control of the records of proceedings in the original court or jurisdiction to order the inspection of such records. Its jurisdiction is confined to proceedings connected with the “ trial and determination of the indictment.” The ■line of cleavage is distinct and accords with the requirements both of orderly procedure and convenience.

The order of the Appellate Division should be reversed and the application for an order of prohibition dismissed, without costs.

Crane, Ch. J., O’Brien, Hubbs, Crouch, Loughran and Finch, JJ., concur.

Order reversed, etc.


author: Crane, Ch. J.

text:
    The Chase National Bank of the City of New York, Respondent, v. Mary Turner et al., Defendants, and Kathleen N. O’D. Candee, Individually and as Executrix of William F. S. Hart, Deceased, Appellant.
    (Argued December 4, 1935;
    decided January 8, 1936.)

      Mark C. Candee for appellant.
    The privilege of a suitor to be exempt from service of process while without the jurisdiction of his residence for the purpose of attending court in an action to which he is a party is applicable. (Parker v. Marco, 136 N. Y. 585; Perusse v. Perusse, 5 H. L. Cas. 671; Mahon v. Mahon, 2 Irish Eq. Rep. 440; Ahearne v. Maguire, 2 Irish Eq. Rep. 437; Pitt v. Coomes, 5 B. & Ad. 1078; Matter of McNeil, 6 Mass. 245; Miles v. McCullough, 1 Binney, 77; Matthews v. Tufts, 87 N. Y. 568; Andrews v. Lembeck, 46 Ohio St. 38; Stewart v. Ramsay, 242 U. S. 128; Kinne v. Lant, 68 Fed. Rep. 436; Vincent v. Watson, 1 Rich. Rep. 197; Newton v. Askew, 6 Hare, 319; Franklyn v. Colquin, 56 Eng. Rep. 213; Selby v. Hills, 8 Bing. 166; Clark v. Grant, 2 Wend. 257.)

      Edward F. X. Ryan and George L. Trumbull for respondent.
    Attendance at the Appellate Division for the purpose of hearing the argument of an appeal on her behalf did not clothe the appellant with immunity from service of process since her presence at that court was not necessary to further the administration of justice, nor to maintain its authority or dignity. The reason for immunity, therefore, does not exist. (Ricketts v. Gurney, 1 Chitty, 682; Matter of Cobbett, 7 E. & B. 955; Mountague v. Harrison, 3 C. B. [N. S.] 292; Gilpin v. Cohen, 4 Exch. 131; Hopkins v. Coburn, 1 Wend. 292; Seaver v. Robinson, 3 Duer, 622; Person v. Grier, 66 N. Y. 124; Matthews v. Tufts, 87 N. Y. 568; Parker v. Marco, 136 N. Y. 585; Netograph Mfg. Co. v. Scrugham, 197 N. Y. 377; Bunce v. Humphrey, 214 N. Y. 21; Petrova v. Roberts, 245 N. Y. 518; Finucane v. Warner, 194 N. Y. 160; Sampson v. Graves, 208 App. Div. 522; Brooks v. State ex rel. Richards, 79 Atl. Rep. 794; Lamb v. Schmitt, 285 U. S. 222; Page Co. v. MacDonald, 261 U. S. 446; Stewart v. Ramsay, 242 U. S. 128; Long v. Ansell, 293 U. S. 76.)
   Crane, Ch. J.

The Appellate Division has certified to us the following question: “ Is a non-resident party defendant who comes into this State for the sole purpose of hearing the argument of her appeal before the Appellate Division in another action immune from service of process while she is returning from the Appellate Division court house to her home outside the State in an action brought in the courts of this State? ”

Kathleen N. O’Donnell Candee was the defendant in an action to enforce a mechanic’s hen for improvements on premises 465 Central Park West in the borough of Manhattan, city of New York. From the judgment against her and others an appeal was taken to the Appellate Division on various grounds. On the hearing of that appeal she came from her home in Connecticut for the sole purpose of being present with her counsel and assisting him, if needed, in the presentation of her case. While leaving the courthouse to return home she was served with process in this case, which is to foreclose a mortgage upon the same premises, and the courts below have held, following Sampson v. Graves (208 App. Div. 522), that the service was good.

The respondent takes the position, which was that of the court in the Sampson case, that when the party’s presence is not needed for the purpose of testimony as a witness, nor to assist in the trial of the action, she is not entitled to the cloak of immunity. We think this is too narrow a view to take of the immunity rule, when we bear in mind its purpose and object and the assistance which clients frequently afford counsel in the argument upon the facts. True it is that in theory at least little assistance can be afforded by some clients to some lawyers on questions of law. When, however, it comes to the argument of intricate questions of fact before the appellate courts, parties may be of much assistance in prompting counsel or suggesting evidence contained in the record. Not infrequently is it necessary for counsel to consult with a client when asked questions from an appellate tribunal regarding facts with which he apparently is not familiar, or in answering suggested concessions. We have known in our own court when counsel has been given the privilege of withdrawing a stipulation for judgment absolute that he has requested the opportunity, if possible, to consult with his client. These occasions may be infrequent — we know that it is- not customary for the clients to appear in the appellate courts —- and yet we think that it is going too far to make a hard and fast rule that it is never necessary or useful or in the interests of justice or the speedy disposition of business for them to come. The limitations, therefore, of Sampson v. Graves we cannot adopt; and authority justifies this conclusion.

Much that has been written is contained in Parker v. Marco (136 N. Y. 585, 589). We quote from that decision:

“ The privilege of a suitor or witness to be exempt from service of process while without the jurisdiction of his residence for the purpose of attending court in an action to which he is a party or in which he is to be sworn as a witness is a very ancient one. (Year Book 13, Hen. IV, I. B. Yiner’s Abr. ‘ Privilege.’)
It has always been held to extend to every proceeding of a judicial nature taken in or emanating from a duly constituted tribunal which directly relates to the trial of the issues involved. It is not simply a personal privilege, but it is also the privilege of the court, and is deemed necessary for the maintenance of its authority and dignity and in order to promote the due and efficient administration of justice. (Person v. Grier, 66 N. Y. 124; Matthews v. Tufts, 87 id. 568.) * * * The tendency has been not to restrict but to enlarge the right of privilege so as to afford full protection to parties and witnesses from all forms of civil process during their attendance at court and for a reasonable time in going and returning. * * * It has even been extended to a suitor returning from an appointment with his solicitor for the purpose of inspecting a paper in his adversary’s possession in preparation for an examination before a master {Sidgier v. Birch, 9 Yes. 69), and while attending at the registrar’s office with his solicitor, to settle the terms of a decree (Newton v. Askew, 6 Hare, 319); and while attending from another state to hear an argument in his own case in the Court of Appeals (Pell’s case, 1 Rich. L. 197).”

This Pell’s case, while not separately reported, is referred to with the facts and decision in an early South Carolina case, Vincent v. Watson (1 Rich. Law Rep. 194). We find other authorities to the same effect. Matter of McNeil (6 Mass. 245); Miles v. McCullough (1 Binney, 77 [Penn. Sup. Ct.], cited with approval in Matthews v. Tufts, 87 N. Y. 568, 570); Andrews v. Lembech (46 Ohio St. 38, cited in Stewart v. Ramsay, 242 U. S. 128); Kinne v. Lant ([Mich.] 68 Fed. Rep. 436, also cited in the Stewart case). (See, also, Persse v. Persse, 5 H. L. Cas. 671; Mahon v. Mahon, 2 Irish Eq. Rep. 440; Pitt v. Coomes, 5 B. & Ad. 1078 [King’s Bench, 1834].)

If the party comes into this State for other purposes besides attending the hearing the immunity is gone. (.Finucane v. Warner, 194 N. Y. 160.) Here, however, the record shows that Mrs. Candee came solely for the purpose of attending the argument of her case in the Appellate Division.

The order of the Appellate Division and that of the Special Term should be reversed, the motion to set aside the service of the summons granted, with costs in all courts, and the question certified answered in the affirmative.

Lehman, O’Brien, Crouch and Loughran, JJ., concur; Hubbs, J., not voting; Finch, J., not sitting. Ordered accordingly.