author: Desmond, J. Lehman, Ch. J.

text:
    Wise & Co., Inc., Appellant, v. Wecoline Products, Inc., Respondent.

      Argued May 26, 1941;
    decided July 29, 1941.

      Frederick E. Crane, Milton Greenebaum and Isidor Enselman for appellant.
    By practical construction, the contract made by the cables and letters included the force majeure clause contained in the writing signed by the parties. (Nicoll v. Sands, 131 N. Y. 19; Wirth & Hamid Fair Booking, Inc., v. Wirth, 240 App. Div. 413.) There is ample evidence of a force majeure custom extending time for delivery, and the verdict is fully supported by the evidence. (Turner Co. v. Robinson, 55 Misc. Rep. 280; Duncan v. Wohl, South & Co., 201 App. Div. 737; Burd v. Bleischer, 208 App. Div. 499; Alsens A. P. C. Works v. Degnon Cont. Co., 222 N. Y. 34; Greeff Engineering & Mfg. Co. v. Scourene Mfg. Co., 182 App. Div. 311; Supple v. International Ry. Co., 208 App. Div. 547; Ochs v. Woods, 221 N. Y. 335; Van Rensselaer v. Chism, 186 App. Div. 557; General Commercial Co., Ltd., v. Butterworth-Judson Corp., 198 App. Div. 799; Maurer Co. v. Tubeless Tire Co., 272 Fed. Rep. 990; Blumenthal & Co. v. Gallert & Co., 240 N. Y. 217; Peabody v. Speyers, 56 N. Y. 230; Mesibov, Glinert & Levy v. Cohen Mfg. Co., 245 N. Y. 305; Marks v. Cowdin, 226 N. Y. 138; Spiegel v. Lowenstein, 162 App. Div. 443.)

      Frank C. Laughlin, Joseph W. Kirkpatrick and Samuel J. Loewenstein for respondent.
    There is no evidence in the record of a uniform custom of the trade to use the force majeure clause contained in the writing, or one having similar provisions, for the evidence conclusively establishes that numerous types of force majeure clauses containing substantially different terms as to the duties' and obligations of the sellers and buyers were used in contracts for the purchase and sale of cocoanut oil from the Philippine Islands. (Elenkrieg v. Siebrecht, 238 N. Y. 254; Shotwell v. Dixon, 163 N. Y. 43; Doniger v. Berger, 241 App. Div. 23; Freitag v. Franklin Fire Ins. Co., 242 App. Div. 241; Matter of Case, 214 N. Y. 199; Getty v. Williams Silver Co., 221 N. Y. 34; Russ v. Russ, 263 N. Y. 625; Lalor v. City of New York, 208 N. Y. 431; People v. Scharf, 217 N. Y. 204.) A custom of the trade must be uniform and certain without varying or flexible terms. (Manhattan Co. v. Morgan, 242 N. Y. 38; Federal Reserve Bank v. Malloy, 264 U. S. 160; Eckstein v. Schleimer, 62 Misc. Rep. 635; Sipperly v. Stewart, 50 Barb. 62; Oelricks v. Ford, 23 How. [U. S.] 49; Sickelco v. Union Pac. R. Co., 111 Fed. Rep. [2d] 746; Martin v. State Highway Board, 54 Ga. App. 856; Porter-
      field v. American Surety Co., 201 Mo. App. 119.) The verdict for the plaintiff cannot be sustained upon the theory of a practical construction of the contract by the parties. (Lawrence v. Gallagher, 73 N. Y. 613.) An alleged custom which has not been incorporated in or referred to in a memorandum of sale or written agreement is subject to the reasonable construction that the omission was to exclude the operation of the custom. (Grace v. American Central Ins. Co., 109 U. S. 278; Menage v. Rosenthal, 175 Mass. 358; Dant & Russell, Inc., v. Grays Harbor Exportation Co., 106 Fed. Hep. [2d] 911; Mengel & Bros. Co. v. Handy Chocolate Co., 10 Fed. Rep. [2d] 293; City of Covington v. Kanawha Coal & Coke Co., 121 Ky. 681.)
   Desmond, J.

The action is for damages for the alleged breach by defendant of a contract to purchase cocoanut oil from plaintiff. The dealings of the parties were through a broker. By cable messages, transatlantic telephone conversations, and correspondence, it was agreed in May, 1937, that plaintiff, a Philippine Islands corporation, should sell, and defendant, whose office is in New York city, should buy, 700 tons of this oil at a price fixed, shipment to be made during June, 1937. There was some dispute as to whether payment should be by a ninety-day draft or a sight draft, but the purchaser finally met the seller’s demands in this respect, and furnished a sight draft. It seems to haye been the uniform practice in the cocoanut oil trade that the terms of such agreements were negotiated as was done here, then later embodied in a formal written agreement. Looking to the preparation of such a formal writing, the broker cabled plaintiff: We are familiar with the Cristobal form of contract do you want us to execute and send forward * * Plaintiff answered: Leave you to arrange contract.”

The so-called “ Cristobal ” form of contract, to which we shall refer again, was not used. The broker prepared a form which included this provision: “ Seller shall not be responsible for non-delivery or delay in delivery when caused by partial or total interruption of transportation facilities * * * or from any delay caused by inability to secure freight space * * * and in event of any delay in delivery from any such cause, this contract may at seller’s option be extended for a like period equal to such delay.” On or about May 14, 1937, defendant signed this agreement in New York city and arranged with a New York bank for the necessary credit to cover the sight draft. About a month later the agreement forwarded by the broker, reached plaintiff in Manila. Plaintiff signed and returned it with a letter informing the broker that the ship Bengalen, on which plaintiff had arranged to ship the oil, had been delayed by a grounding and subsequent dry docking and would not reach Manila until July 5th, so that June shipment was impossible. Parenthetically, the jury apparently found on sufficient evidence that plaintiff made reasonable efforts to procure other shipping space for a June sailing, but without success. Plaintiff through the broker, asked defendant to agree to an extension of time for shipment and to arrange an extension of the letter of credit to cover the delay. Defendant refused, claiming that' plaintiff’s failure to ship in June was a breach of contract. In the meantime the market price had dropped and plaintiff had to sell the oil to other purchasers at a substantial reduction from the price arranged with defendant.

Plaintiff sued, alleging a breach of the formal contract, which was attached to the complaint. Later plaintiff added a second cause of action for a breach of the agreement as made by the cablegrams and letters which covered price, quantity, shipping time, etc. In this added cause of action plaintiff included an allegation that there existed in the cocoanut oil trade a general usage and custom to the effect that if a seller was unable to make delivery in the stipulated time, for reasons beyond the seller’s control, the time for delivery was extended for a period equal to the period of such delay. On the trial, plaintiff sought to prove this custom by the testimony of persons familiar with the cocoanut oil trade. At the close of plaintiff’s case, defendant moved to dismiss both causes of action as not established. The court, with plaintiff’s consent, then struck out the first cause of action, on the written contract, but granted plaintiff’s motion to amend the remaining cause of action by inserting in this remaining cause of action the allegations of the stricken cause of action as to the making of the formal agreement. As the matter was then left by this ruling, the contract sued upon was the one made out by the cablegrams and letters which had been, as plaintiff’s counsel put it, “ memorialized by a later instrument.” The trial court’s ground for holding that the formal written and signed instrument was not the contract between the parties, was that plaintiff, when it signed this paper containing the delay clause, knew that it could not deliver in June. This formal writing, the court said, did have significance, however, as evidence of what the contract was.

The court in his charge told the jury that there were two questions before it: first, was it the known and accepted custom of the trade that there be read into every such contract, an unavoidable delay, or force majeure, clause of the same import as the clause actually found in the written “ memorial,” and, second, did plaintiff, assuming the existence of such a custom, do everything it was required to do by such a custom. The jury was told that if it answered either question in the negative, plaintiff could not recover. The jury brought in a verdict for plaintiff. The Appellate Division, one justice dissenting, reversed and dismissed the complaint, holding that plaintiff had failed to establish any uniform force majeure clause customary in the trade ” and that “ although some ldnd of a force majeure clause appears commonly to have been inserted in contracts for the sale of cocoanut oil, they differed in such important respects in their terms that it cannot be said that parties in the trade contracted with relation to any particular force majeure clause.” (261 App. Div. 886.) This dismissal requires us to examine plaintiff’s proofs.

The three experts who testified for plaintiff on this question of custom were in agreement that in such contracts there was always expressed or implied some provision concerning unavoidable delays. In the testimony of each can be found language to the effect that the shipper when faced with such a delay, is entitled by fixed custom to an extension of time. But the testimony of these same experts, on cross-examination, leaves it at least doubtful whether the testimony of any one of them amounts to a clear statement of the existence in this trade of a custom so general, uniform and unvarying as to furnish a fixed and definite standard by which to ascertain the intention of the parties. (Manhattan Co. v. Morgan, 242 N. Y. 38, 53; Federal Reserve Bank v. Malloy, 264 U. S. 160, 170.) The so-called Cristobal ” form of contract which the broker suggested in one of the cablegrams, and which, while not used by the parties, is in the record as defendant’s Exhibit D, contains no specific provision for an extension of time to the shipper for unavoidable delays but includes this language on the subject of delay: Seller not to be responsible for nondelivery or delay in delivery resulting from any contingency beyond its control or its subsidiary company’s control.” That force majeure clause would seem not to bear out plaintiff’s claim of a uniform custom of extending the delivery time, but to mean only that the shipper is not to be held liable for unavoidable delays.

However, while we may doubt the sufficiency of the proof as to an unvarying custom, we find proof that defendant agreed, by signing the formal contract, that as a usual term and condition of such contracts, plaintiff was entitled to an extension of time equal to the period of any unavoidable delay. The broker, before preparing the formal agreement, wrote defendant confirming its purchase, mentioning quantity, price, shipment in June, credit terms, etc., and adding the phrase: usual terms and conditions.” Thereafter the broker submitted to defendant the formal agreement containing the force majeure clause on which plaintiff now relies. The parties here concede that defendant’s signature to this form of agreement did not bind it •to the agreement, as such, when it later turned out that the plaintiff in its turn, signed the paper knowing that it could not perform as to a shipment in June. But the written agreement and its force majeure provision is still in the case, at least as a memorial, or written record, of what the parties meant by usual terms and conditions.” It thus amounts to an admission by defendant that the force majeure clause in the writing was one of the “ usual terms and conditions ” of a shipment of cocoanut oil from the Philippine Islands to the United States, and thus part of the contract between the parties. Being an admission against defendant’s interest of a fact favorable to plaintiff, it was evidence to which the jury could give such weight as seemed appropriate. (Cook v. Barr, 44 N.Y. 156,158; Reed v. McCord, 160 N. Y. 330, 340; Miller v. Silverman, 247 N. Y. 447, 450.) ■ The signature of defendant to the memorial, containing the force majeure clause, cannot be regarded as totally without significance. As the trial justice said, in denying defendant’s motion to dismiss: “ * * * I am very clear on it, that the instrument has only significance as evidence of what the other agreement was.” With that writing before it, the jury could say, as it did by its verdict, that the clause was a customary one in the sense that it was one of the “ usual terms and conditions,” to which the parties had bound themselves informally, and that defendant was guilty of a breach when it refused the extension of time and refused to accept a July shipment.

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

Lehman, Ch. J.

(dissenting). In May, 1937, the plaintiff, a .corporation doing business in the Philippine Islands, agreed to sell to the defendant, a corporation doing business in the city of New York, 700 tons of cocoanut oil. The agreement was negotiated by Zimmerman, Alderson, Carr Co., oil brokers, who have an office in the city of New York. In their negotiations the parties communicated with each other by cable, telephone and mail. Under the terms of the contract agreed upon in that manner, shipment was to be made during June, 1937, and payment of the stipulated price was to be made by means of a draft drawn under confirmed irrevocable banker’s letter of credit to be established immediately by the buyer. After some dispute in regard to whether the draft should be a sight draft or a ninety-day draft, the buyer furnished a sight draft as demanded by the seller. The seller was unable to make shipments during June and the buyer refused to furnish an extension of the letter of credit to cover shipments made after the end of June.

After agreement had been reached in manner I have stated, the brokers submitted to both parties a written contract of purchase and sale. The contract contained a clause which permitted the seller to ship the oil after the end of June if unable to make such shipments during that month. No such clause had previously been discussed by the parties but both parties signed the written contract as submitted by the brokers. If the written contract signed by both parties were valid, the plaintiff would be entitled to recover damages caused to it by the defendant’s failure to accept shipments made in accordance with the “ force majeure ” clause extending the stipulated time for shipment where shipment is prevented by causes beyond the control of the seller. Because the plaintiff signed that contract after the time when shipment during June' could have been made in accordance with its terms, the trial court held that the written contract did not become effective, and dismissed, without objection by the plaintiff, the plaintiff’s cause of action for damages caused by breach of that. contract as alleged in the complaint in this action.

It is said, however, that the written contract was intended to be a memorial of the agreement previously made by cable, telephone and letter and that the plaintiff may recover damages under the earlier contract. The plaintiff recovered judgment upon that theory. Doubtless the evidence sufficiently establishes that the parties believed that they had arrived at a complete agreement for the purchase and sale of the oil before the written contract was prepared. It was understood that the agreement so arrived at would thereafter be embodied in a formal written instrument which would integrate the negotiations and be the sole memorial of the agreement of the parties. The parties, doubtless, intended, however, that the agreement should be enforceable even before the written contract was signed. Only by consent of both parties could the written agreement add any terms to those agreed upon, but neither party was free to refuse to sign a contract which would embody those terms upon which there had been oral agreement. In this case the abortive signing of the written instrument does not change the legal rights of the parties under the previous agreement. If the parties had previously agreed expressly or impliedly that the contract for oil to be shipped in June should contain a proviso that shipment might be made later, the defendant has breached the contract and the plaintiff is entitled to damages The plaintiff, in the second cause of action of its complaint, alleged that the informal agreement contained such a proviso.

There is evidence that in the cocoanut oil trade, a custom exists that after a broker has negotiated an agreement of purchase and sale of oil to be shipped from abroad, a formal contract is executed by the parties setting forth the terms and conditions upon which the parties have reached express agreement and in addition usual terms and conditions,” including a force majeure clause. In this case the brokers’ notice of confirmation stated that the formal written contract would contain “ usual terms and conditions.” There is also testimony that some force majeure clause was usually, if not invariably, incorporated in every written contract. To establish a cause of action the plaintiff must show not only that the parties understood that some form of force ■ majeure clause was usual but also that the usual and customary form not only excused failure to perform by the seller within the stipulated time where performance was impossible, but extended the time during which performance might be made.

The jury found that the force majeure clause, incorporated in the written instrument which was signed by both parties, was the usual and customary clause to which both parties impliedly agreed. The Appellate Division reversed the judgment in plaintiff’s favor and dismissed the complaint, holding that there was no evidence to sustain the finding. Experts who testified as witnesses for the plaintiff showed that it was customary to insert some force majeure clause in every contract, but it dearly appears, even from their testimony, that the nature of the force majeure provision varied in the different contracts. In some contracts the clause provided that performance by the seller of an agreement to ship at a stipulated time would be excused where performance is not possible. In other contracts impossibility of performance at the stipulated time would automatically extend the time for shipment, so that when performance thereafter became possible the seller would be required to ship and the buyer would be required to accept and pay for the oil at the agreed price. By fair implication we may read into the contract of purchase and sale of oil to be shipped in June, a clause which would permit performance in July only if such a clause is so usual that inference would be justified that the obligation for June shipment was made subject to such a condition. ■ A majority of the court agree, I think, with the Appellate Division that the testimony of the witnesses who are connected with the oil trade is insufficient to prove that.

We are told, however, that though the written instrument has no force as a new convention of the parties, it is still in the case, with its force majeure provisions, at least as a memorial, or written "record, of what the parties meant by usual terms and conditions.’ It thus amounts to an admission by defendant that the force majeure clause in the writing was one of the 1 usual terms and conditions ’ of a shipment of cocoanut oil from the Philippine Islands to the United States, and thus part of the contract between the parties.” The written contract embodies those terms which the parties were willing to accept, but under the circumstances of this case acceptance by the defendant of the force majeure clause does not indicate that the clause was part of the original agreement. The evidence that before preparing the formal writing the broker cabled the plaintiff, “We are familiar with the Cristobal form of contract do you want us to execute and send forward * * and that plaintiff answered, “ Leave you to arrange contract,” shows conclusively that the broker and the parties understood that preparation of the formal writing involved more than formulation of terms previously agreed upon expressly or by necessary implication, but required choice of terms which would be acceptable to the parties in amplification of what had already been agreed to. The “ Cristobal ” form of contract contains a force majeure clause quite different from the force!: majeure clause eventually embodied in the written contract. The parties, not having agreed impliedly to accept the Cristobal form or any other particular form were still free to determine what force majeure clause would be acceptable. The fact that the defendant did accept a particular form which would have permitted an extension is evidence that it was willing to accept such a clause at that time. It is no evidence that the defendant had agreed to such a clause before. The evidence, in my opinion, shows beyond possibility of dispute that the parties had not so agreed earlier.

Judgment should be affirmed.

Loughran, Finch, Bippey and Lewis, JJ., concur with Desmond, J.; Lehman, Ch. J., dissents in opinion in which Conway, J., concurs.

Judgment accordingly. (See 286 N. Y. 699.)


source: Caselaw Access Project

author: Lehman, Ch. J.

license: Public Domain

text:
    The People of the State of New York ex rel. Knott Management Corporation, Appellant, against Mark Graves et al., Constituting the State Tax Commission, Respondents.
    Argued June 4, 1941;
    decided July 29, 1941.

      Samuel E. Aronowitz and Stanton Ablett for appellant.
    The exemption claimed by petitioner was intended by the statute fixing the tax (Laws 1939, ch. 433, § 3). The ruling of the Tax Commission results in discrimination against petitioner. (Schlesmger v. Wisconsin, 270 U. S. 230; Matter of Luchow, Inc., v. Taylor, 251 App. Div. 164; 275 N. Y. 536; Howitt v. Street & Smith Publications, Inc., 276 N. Y. 345; People ex rel. Metropolitan Playhouses, Inc., v. Graves, 251 App. Div. 655; 275 N. Y. 621; Brustein v. New Amsterdam Casualty Co., 255 N. Y. 137; Matter of Federal Land Bank v. Pickard, 169 Misc. Rep. 753.)

      John J. Bennett, Jr., Attorney-General (Edward J. Gretchen and Henry Epstein of counsel), for respondents.
    Section 3 of chapter 433 of the Laws of 1939 is clear and unambiguous, limiting the exemption to 250 gallons to “ each person ” as defined in section 420 of the Tax Law (Cons. Laws, ch. 60). (People ex rel. Twenty-third St. R. R. Co. v. Comrs. of Taxes, 95 N. Y. 554; People ex rel. Manhattan Fire Ins. Co. v. Comrnr. of Taxes, 76 N. Y. 64; United States v. Moore, 65 TJ. S. 760; Philadelphia & Wilmington Railroad v. Maryland, 10 How. 376.) No discrimination is involved. The statute applies equally to all similarly situated. (N. Y. Rapid Transit Corp. v. City of N. Y., 275 N. Y. 258; Matter of Howell, 255 N. Y. 211; People ex rel. Hatch v. Reardon, 184 N. Y. 431; Matter of Vanderbilt, 281 N. Y. 297; Matter of Davies, 242 N. Y. 196; People ex rel. U. S. Title Guaranty Co. v. Tax Comm., 230 N. Y. 102.)
   Lehman, Ch. J.

Section 424 of the Tax Law (Cons. Laws, ch. 60) imposes excise taxes upon beers, wines and liquors. Prior to May 10, 1939, the tax was one dollar per gallon upon liquors containing more than twenty-four per cent of alcohol per volume when sold or used within this state by a distributor.” By chapter 433 of the Laws of 1939 it was provided that the tax on such liquors should be one dollar and fifty cents for the period beginning May tenth, nineteen hundred thirty-nine, and ending June thirtieth, nineteen hundred forty.” The new statute provided also that “ To avoid evasion of the increased tax upon liquors provided for by this act, by transactions allegedly entered into before its effective date, with resultant loss of revenue to the state, and the unfair competition in sales at retail which would probably result from persons avoiding such increased tax by such transactions, there is hereby imposed a floor tax and a delivery tax, as follows: (a) There is hereby levied and imposed upon each person other than a distributor who on May ninth, nineteen hundred thirty-nine, owns or possesses for the purpose of sale any liquors, a floor tax at the rate of fifty cents per gallon upon such liquors over and above normal stock, which for the purposes of this tax is hereby defined to be two hundred fifty gallons of liquor for each such person” (§3).

The appellant, Knott Management Corporation, operates under its own name eight hotels and restaurants in the city of New York. Each of these hotels and restaurants is required to have a separate license but all the licenses have been applied for and issued in the name of Knott Management Corporation. A floor tax ” has been levied upon the appellant at the rate of fifty cents per gallon upon all the liquor which it held May 9,1939, for purposes of sale in. all eight hotels and restaurants over and above 250 gallons. The appellant claims that the tax should be levied only upon liquors over and above the normal stock ” of 250 gallons held for sale in each hotel and restaurant for which a separate license has been issued.

Outside of the city of New York the appellant operates other hotels and restaurants under management contracts, but there the licenses have been applied for and issued, not in the name of the appellant but in the name of the owner. It is said that the appellant operates the eight hotels and restaurants in the city of New York under similar management contracts and that the circumstance that in the city of New York the appellant has chosen to apply for the licenses in its own name, rather than in the name of the actual owner, should not affect the amount of the tax payable by it. The record does not disclose the provisions of the contracts under which the appellant operates or manages the hotels and restaurants either in the city of New York or outside of the city, and in our opinion the provisions of the contract or the character in which the appellant operates these places of business is immaterial. Section 420 of the Tax Law defines the term “ person ” and the term “ owner.” Within those definitions the appellant is both a person ” and the owner ” of all eight places of business for which licenses have been issued in its name, regardless of whether the appellant operates these places of business as manager under management contracts or as principal. The problem which we must decide in this case is whether the Legislature, in defining at 250 gallons the normal stock ” of liquor of each person upon whom the tax is imposed, intended that such definition of 250 gallons should be applied to the “ normal stock ” of each place of business for which a separate license is required or should apply to the normal stock ” of the aggregate of all the places of business owned, within the meaning of the statute, by a single person, though operated as required by statute under separate license.

There is reasonable basis for defining a “ normal stock ” of liquors to be 250 gallons if the statutory definition is applied to the normal stock of separate hotels and restaurants. It is difficult' to see any reasonable basis for such a definition if intended to apply in like manner to one restaurant and to a number of hotels and restaurants which happen to be under the same management. Argument, not without force, may be made that, reasonably or unreasonably, the Legislature has chosen to define at 250 gallons the normal stock ” of “ each person/’ regardless of whether such person is the owner or manager of one or a hundred restaurants or hotels where such liquor is offered for sale, and that the courts cannot change the definition adopted by the Legislature. When the Legislature has in unambiguous language made a classification, then it is true the courts cannot adopt a different classification, though they might be compelled to hold that the classification adopted by the Legislature is so unreasonable that it transcends the legislative power. In this case, the language of the statute is not so clear and unambiguous that the courts are constrained to construe it in manner which would raise doubt as to the validity of the statute. It is open to the construction that in using the terms “ floor tax ” and normal stock ” the Legislature indicated that its definition of the “ normal stock ” was to apply to the stock of liquors held in each place where liquor is sold and where a separate license is required.

The order of the Appellate Division should be reversed, the determination of the Tax Commission annulled, and the matter remitted to the State Tax Commission to fix the tax in accordance with this opinion, with costs in this court and in the Appellate Division.

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

Ordered accordingly.


text:
    Hyman Seif, Respondent, v. City of Long Beach, Appellant.

      Argued May 26, 1941;
    decided July 29, 1941.

      Bernard H. Reich, Corporation Counsel (Frederick E. Crane of counsel), for appellant.
    The plaintiff’s assignor is chargeable with knowledge that the Mayor in employing him had no authority to bind the city, and hence there can be no ratification by mere knowledge of the illegal employment and failure to repudiate the same. (N. Y. Rubber Co. v. Rothery, 107 N. Y. 310; Trenton Banking Co. v. Duncan, 86 N. Y. 221; Wiser v. Lawler, 189 U. S. 260; McDonald v. Mayor, 68 N. Y. 23; Miller v. Mayor, 3 Hun, 35; Higginson v. Fall River, 226 Mass. 423; Heaton v. City of Cohoes, 270 N. Y. 222; Dyddy v. Long Island City, 104 N. Y. 218; Konnoson v. City of New York, 254 App. Div. 378; 281 N. Y. 716; Keane v. City of New York, 88 App. Div. 542; Walton v. Mayor, 26 App. Div. 76; Smith v. City of Newburgh, 77 N. Y. 130.)

      Louis Boehm and Samuel Zeiger for respondent.
    The Common Council had power to retain special counsel, in the absence of any charter provision prohibiting such employment. (Matter of Clark v. Smith, 250 App. Div. 233; 276 N. Y. 473; Judson v. City of Niagara Falls, 140 App. Div. 62; 204 N. Y. 630; Stout v. City of Bayonne, 15 N. J. Misc. 672; 120 N. J. L. 242; City of Birmingham v. Wilkinson, 194 So. Rep. 548; 17 Ruling Case Law, 774; 83 A. L. R. 137; Matter of W. S. A. & P. R. R. Co., 115 N. Y. 442; Easton v. Pickersgill, 55 N. Y. 310; Town of Amherst v. County of Erie, 236 App. Div. 58; 260 N. Y. 361.) The Council’s knowledge of, and acquiescence in, the performance of the services, and the defendant’s acceptance of the benefits thereof, constitute a ratification of the attorney’s retention as binding as though originally authorized by formal resolution. (Peterson v. Mayor, 17 N. Y. 449; Vermeule v. City of Corning, 186 App. Div. 206; 230 N. Y. 585; People ex rel. Griffiths v. Board of Supervisors, 143 App. Div. 722; Fister v. La Rue, 15 Barb. 323 ; Matter of Christey, 92 Misc. Rep. 1; Bourejois v. Atlantic County, 82 N. J. L. 82; Ballagh Realty Co. v. Borough of Dumont, 111 N. J. L. 32; City of Logansport v. Dykeman, 116 Ind. 15; City of Sagamore v. Consumers Power Co., 213 Mich. 460; Stout v. City of Bayonne, 15 N. J. Misc. 672; 120 N. J. L. 242; Montgomery v. Cheyenne County High School Dist., 78 Col. 162; Day v. City of Malvern, 195 Ark. 804; Fleming v. Village of Suspension Bridge, 92 N. Y. 368.) Special counsel is neither an officer, deputy or employee of the city. The retention of special counsel did not require an ordinance of the Council by a four-fifths vote. Nor did it require a resolution fixing his compensation. (New Farley Nat. Bank v. Montgomery Co., 17 Ala. 297; Wellman v. Reilly, 81 N. H. 389; Matter of Clark v. Smith, 250 App. Div. 233; 276 N. Y. 473; Coggeshall v. Hennessey, 279 N. Y. 438.)
   Lehman, Ch. J.

The plaintiff, as assignee of Louis Boehm, has recovered a judgment for $12,000, together with interest and costs, for services rendered by Mr. Boehm acting as attorney and special counsel for the defendant City of Long Beach. He was retained in April, 1934, by the Mayor of the city to represent the city in-litigation which he advised the Mayor to bring for the protection of the interests of the city. The city does not question that he thereafter rendered legal services with skill and that the city received the benefit of these services. It does not now claim the judgment is excessive as matter of law or otherwise erroneous, if the city is liable for the reasonable value of services rendered by an attorney at the instance of the Mayor. It denies liability on the ground that the Mayor has no authority to retain special counsel.

The Charter of the City of Long Beach (L. 1922, ch. 635) contains no provision which expressly or by fair implication confers such authority upon the Mayor of the city. The trial judge so charged. Only the City Council has power to establish positions in the city service on_to authorize the employment of special counsel to represent the city in specified matters, either alone or in association with the Corporation Counsel. The City Council has adopted no ordinance or resolution authorizing the Mayor to retain. Mr. Boehm or other special counsel, but the plaintiff urges, and the jury has found, that the Council, or at least four-fifths of the members of the Council, had knowledge that Mr. Boehm was retained by the Mayor as special counsel and was performing services for the benefit of the city. That with such knowledge the Council did not object or protest but acquiesced in the performance of such services by Mr. Boehm and that by its conduct the Council has ratified the retainer and has estopped the city from challenging its legality or denying liability for the value of the services rendered by Mr. Boehm.

The City Council has five members — the Mayor, the Supervisor, and three men elected as Councilmen. There is evidence which is probably sufficient to support a finding that four members of the Council knew that Mr. Boehm, at the instance of the Mayor, was rendering legal services for which he expected to be paid. As attorney for the city, Mr. Boehm instituted legal proceedings to compel the Board of Supervisors of Nassau County, sitting as a Board of Equalization, to exclude from the total assessed value of property in the city of Long Beach, for the purpose of tax equalization, real property valued at approximately $5,000,000, which had been bid in by the city of Long Beach at a tax sale. A decision favorable to the city was rendered by the Supreme Court at Special Term, but that decision was reversed by the Appellate Division. Until after the Appellate Division had rendered its decision, no person or official body questioned the authority of Mr. Boehm to institute and prosecute the proceeding as attorney for the city. Even then, Mr. Boehm’s authority was not questioned by the city of Long Beach or any officer or board of the city, but the Attorney for the County of Nassau, which had been successful in the Appellate Division, informed Mr. Boehm that if he attempted to take an appeal from the decision of the Appellate Division, his authority would be questioned by the county. Then Mr. Boehm requested the City Council to adopt a formal resolution authorizing or confirming his retainer by the Mayor so that his authority to take and prosecute the appeal in behalf of the city should not be subject to doubt. Instead, the Council adopted a resolution directing the Corporation Counsel to file a notice of appeal.

The reason for the failure of the Council to adopt a resolution, as requested by Mr. Boehm, expressly authorizing or confirming his retainer, was due, it is said, to the existence of a political squabble between the Council and the Mayor, and we are told that if the squabble had been settled Mr. Boehm would have been allowed to proceed as counsel for the city and would have been paid for his services. That rests on conjecture .and the courts are not concerned with the motives of the Council. The relevant facts are that the Council did not pass any resolution as requested by Mr. Boehm, conferring upon Mr. Boehm authority to proceed with the appeal; nor, on the other hand, did it inform Mr. Boehm, until after he had prepared the records and briefs to be submitted upon the appeal to the Court of Appeals, that his services previously rendered were unauthorized and that he must desist from acting as counsel for the city.

The City Council, having authority to authorize appointment of Special Counsel, could, by its ratification, give validity to the retainer by the Mayor, though such retainer was unauthorized and invalid when made. Ratification by a municipal corporation, like ratification by a private corporation or by an individual, may be by express assent, or by acts or conduct of the principal, inconsistent with any other supposition than that he intended to adopt and own the act done in his name.” (Peterson v. Mayor, 17 N. Y. 449, 453.) The opinion, written by Judge Denio, in that case sets forth the rule, applicable to municipal as well as private corporations: “ Chancellor Kent says, the doctrine that corporations can be bound, by implied contracts, to be deduced by inference from- corporate acts, without either a vote or deed or writing, is generálly established in this country with great clearness and solidity of argument.” (Citing cases.) In enunciating that rule, Judge Denio, however, took care to point out the limits of its application. For instance, no sort of ratification can make good an act without the scope of the corporate authority. So where the charter or a statute binding upon the corporation, has committed a class of acts to particular officers or agents, other than the general governing body, or where it has prescribed certain formalities as conditions to the performance of any description of corporate business, the proper functionaries must act, and the designated forms must be observed, and generally no act of recognition can supply a defect in these respects ” (p. 454).

Mere acceptance of benefits by the city under a contract made without authority does not estop a municipal corporation from challenging the validity of the contract and from denying liability for materials furnished or services rendered under a contract not made or ratified by a board or officer acting under authority conferred by law and in the manner prescribed by law. (McQuillan, Municipal Corporations, § 1358.) Where the Legislature provides that valid contracts may be made only by specified officers or boards and in specified manner, no implied contract to pay for benefits furnished by a person under an agreement which is invalid because it fails to comply with statutory restrictions and inhibitions can create an obligation 'or liability of the city. In similar case this court has given emphatic warning that equitable powers of the courts may not be invoked to sanction disregard of statutory safeguards and restrictions. " It is plain, that if the restriction put upon municipalities by the Legislature, for the purposes of reducing and limiting the incurring of debt and the expenditure of public money, may be removed, upon the doctrine now contended for, there is no legislative remedy for the evils of municipal government, which of late have excited so much attention and painful foreboding.” (McDonald v. Mayor, 68 N. Y. 23, 28.)

In this case the jury was permitted to find in favor of the plaintiff upon the theory that failure by the Council to object to the continued performance of services by Boehm under an unauthorized contract, would be sufficient to constitute a ratification of such unauthorized contract if the jury finds that four of the five members of the Council had knowledge of the unauthorized retainer. In our opinion, that constitutes error. The Council of the city acts_as a body. Individual members of the Council' are not, as such, vested with power to bind the city, and no individual member of the Council had either power or duty, as representative of the city, to protest against or object to an assumption of power by the Mayor not granted by the Charter. Since the Charter fails to confer upon the Council or its members any authority to act for the city in connection with the appointment of officers or employees of the city, except when acting as a body at a meeting properly held, the plaintiff, it is clear, cannot recover without proof that there has been ratification by action taken at such meeting.

The plaintiff contends that even if we shoúld hold that tacit acquiescence by the members of the Council is insufficient to constitute ratification, yet the formal resolution directing the Corporation Counsel to take an appeal to the Court of Appeals in litigation instituted by Mr. Boehm, as attorney for the city, constitutes, by necessary implication, a ratification of the authority to institute the proceedings. We find no basis for such an implication in the resolution adopted by the Council. Certainly in adopting that resolution the Council had no intention to confirm or ratify the authority of Mr. Boehm. The Council rejected Mr. Boehm’s request to confirm or ratify his appointment as Special Counsel and his authority to act for the city. Concededly the resolution actually adopted was intended to avoid, at least for the time, such confirmation or ratification. Any implication, then, that the resolution nevertheless constituted such confirmation must rest upon the premise that an appeal by the city from an order or judgment rendered against it in proceedings instituted in its name by an attorney acting without authority rests upon the implied assertion or recognition that the court had jurisdiction and is inconsistent with subsequent challenge of the authority of the attorney to bring the proceedings. The premise is false. The city may insist that the Board of Supervisors unlawfully included certain property in assessment rolls and that the Board should be compelled to correct its alleged error, and may seek by appeal, reversal of an adverse adjudication, without admitting that Special Counsel retained by the Mayor, rather than the Corporation Counsel or Special Counsel retained by the Council, had the right to urge the claim in behalf of the city.

We decide only that the plaintiff has failed to establish any legal claim against the city, even assuming that the services rendered by the plaintiff’s assignor were valuable and resulted in a benefit to the city, which the city would not otherwise have obtained, and that four of the five members of the Council tacitly approved his retainer of Special Counsel and the rendition of services thereunder. We do not consider whether a moral obligation may exist, which should have been recognized by the Council. No legal obligation arose.

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

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

Judgments reversed, etc.


text:
    In the Matter of Electrolux Corporation, Appellant. Frieda S. Miller, as Industrial Commissioner of the State of New York, Respondent.

      Argued May 21, 1941;
    decided July 29, 1941.

      Charles E. Hughes, Jr., Harold L. Smith, William, K. Dupre and Richard W. Hogue, Jr., for appellant.
    This proceeding properly arose under the Unemployment Insurance Law (Labor Law, art. 18; Cons. Laws, ch. 31). (Matter of Mohawk Mills Assn., 260 App. Div. 433; Matter of Scott, 260 App. Div. 975; Matter of International Vital Interests & Home Club Shops, Inc., 258 App. Div. 1026; Matter of Andrews v. North Shore Country Club, 258 App. Div. 1017; Matter of Butler, 258 App. Div. 1017; Matter of Bronxville Nurseries, Inc., 258 App. Div. 1019; Matter of Fidel Association of New York, Inc., 259 App. Div. 486; Matter of Waterman Holding Corp., 260 App. Div. 971; Matter of Seides, 260 App. Div. 971; Matter of Joachim, 260 App. Div. 972; Matter of NuBone Co., 260 App. Div. 973; City

      of New York v. N. Y. C. Ry. Co., 193 N. Y. 543; Bullock v. Cooley, 225 N. Y. 566; Norwegian Nitrogen Products Co. v. United States, 288 U. S. 294; United States v. American Trucking Assn., 310 U. S. 534.) The Appellate Division should in any event have reviewed the decision of the Unemployment Insurance Appeal Board. (Judson v. Gray, 17 How. Pr. 289; City of New York v. Matthews, 213 N. Y. 563; Proestler v. Kuhn, 49 N. Y. 654; Side v. Brenneman, 7 App. Div. 273; Bussing v. Whitaker, 177 App. Div. 95; People ex rel. Solomon v. Brotherhood of Painters, 169 App. Div. 595; Van Schaick v. Friedman, 238 App. Div. 603; Giovanniello v. Germeroth, 243 App. Div. 624; Croissant v. Doscher, 244 App. Div. 736; Tymon v. Tyrose Homes, Inc., 254 App. Div. 582; Kyner v. Bolton, 171 App. Div. 45; Buckley v. Stansfield, 155 App. Div. 735; 214 N. Y. 679; Persky v. Bank of America, 261 N. Y. 212.) The Court of Appeals has jurisdiction of this appeal. (Brooklyn Children’s Aid Society v. Industrial Board, 136 Misc. Rep. 379; 231 App. Div. 845; 256 N. Y. 651; Matter of Anderson v. Johnson Lighterage Co., 182 App. Div. 152; 224 N. Y. 539; 214 App. Div. 743 ; 241 N. Y. 523; Matter of McKinnon v. Kinsman Transit Co., 265 N. Y. 560; Russian Republic v. Cibrario, 235 N. Y. 255; Mount Vernon Company, Silversmiths, Inc., v. Mount Vernon Metal Products Co., 236 N. Y. 648; Rector v. Rector, 134 App. Div. 452; Sherman v. Beacon Constr. Co., 58 Hun, 143; Worthington v. London G. & A. Co., 164 N. Y. 81; O’Connor v. City of New York, 191 N. Y. 238; Booras v. Logan, 266 Mass. 172.)

      Winslow M. Lovejoy and Charles K. Rice for White & Case, amici curiae.

    The proceeding properly arose under section 523 of the Labor Law. (Matter of NuBone Co., 260 App. Div. 973; Matter of Fidel Assn., Inc., 259 App. Div. 486; Matter of Butler, 258 App. Div. 1017; Matter of Bronxville Nurseries, Inc., 258 App. Div. 1019; Matter of Andrews v. North Shore Country Club, 258 App. Div. 1017; Matter of Seides, 260 App. Div. 971; Matter of Joachim, 260 App. Div. 972; Matter of International Vital Interests &

      Home Club Shops, Inc., 258 App. Div. 1026; Matter of Waterman Holding Corp., 260 App. Div. 971; City of New York v. New York City Ry. Co., 193 N. Y. 543; Matter of Armitage v. Board of Education, 122 Misc. Rep. 586; 210 App. Div. 812; 240 N. Y. 548.)

      John J. Bennett, Jr., Attorney-General (W. Gerard Ryan, Henry Epstein and Francis R. Curran of counsel), for respondent.
    The appellant is not a “ party aggrieved ” and, accordingly, cannot appeal under section 588 of the Civil Practice Act. (Dudley v. Perkins, 235 N. Y. 448; Lee v. Gander, 271 N. Y. 568; First Trust & Deposit Co. v. Syrdelco, Inc., 275 N. Y. 468.) The order of the Appellate Division is not one which finally determines the proceeding. (Matter of Begent v. Noyes, 284 N. Y. 229; Matter of Newman Lake House, Inc., v. Bruckman, 258 App. Div. 765; 283 N. Y. 646.)
   Lehman, Ch. J.

Article 18 of the Labor Law (Cons. Laws, ch. 31; L. 1921, ch. 50), entitled Unemployment Insurance Fund (added L. 1935, ch. 468), imposes upon all employers subject to its provisions an obligation to pay contributions ” to the Fund, in “ amount equal to three per centum of the payroll of employees, as herein defined.” (§§ 515 and 516.) Electrolux Corporation is, it is not disputed, an employer subject to the provisions of the statute. It admits its obligation to pay wages to persons in its employ but it does not admit that a group of persons to whom, for convenience, we shall hereafter refer as “ sales representatives,” are in its employ and it has not furnished to the Industrial Commissioner any report of wages paid to them. Each of these persons sells goods manufactured by Electrolux Corporation under uniform contracts called “ Sales Representative Agreement.” Electrolux Corporation has sought a ruling that these persons are independent contractors, not employees, within the meaning of the statute, who are entitled to receive benefits out of the Fund and whose “ wages ” must be included in the base upon which the amount of the contributions required from the employers is computed.

The corporation brought proceedings to review an adverse determination of the Industrial Commissioner and of the Unemployment Appeal Board on that point. The Appellate Division, without considering the merits of the controversy, reversed the determination and dismissed the proceedings instituted by the Electrolux Corporation.

The respondent Industrial Commissioner has moved to dismiss the appeal taken to this court by the Electrolux Corporation from the order entered upon the decisions of the Appellate Division on the ground that the appellant is not aggrieved by the order of the Appellate Division which reversed the decision against it, and on the further ground that the order is not final. That motion must be denied. The appellant seeks an adjudication of a controversy in respect to the scope of its obligation to contribute to the Unemployment Insurance Fund. Though it is not aggrieved by the order of the Appellate Division in so far as the order reverses an adjudication against it, it is aggrieved by that order in so far as it decides that the officers or tribunals, authorized to administer the Fund, and the courts are without power to adjudicate the controversy in any proceeding heretofore brought and in- so far as it dismisses, and thus finally determines, the special proceeding instituted by the appellant to obtain such an adjudication.

The article of the Labor Law which creates and defines the obligation of an employer to contribute to the Unemployment Insurance Fund provides, in section 523,. subdivision 1:

“ (a) If an employer fails to file a report for the purpose of determining the amount of his contribution due under this article, or if such report when filed is incorrect or insufficient and the employer fails to file a corrected or sufficient report within twenty days after the commissioner requires the same by written notice, the commissioner shall determine the amount of contribution due from such employer on the basis of such information as he may be able to obtain and he shall give written notice of such determination to the employer. Such determination shall finally and irrevocably fix the amount of contribution unless the employer shall within twenty days after the mailing or personal delivery of notice of such determination apply to the commissioner for a hearing or unless the commissioner of his own motion shall reduce the same.
In like manner any employer who claims to be aggrieved by any other rule or order of the commissioner under any provision of this article may apply to the commissioner for a hearing. * * *
“ (b) Within twenty days after the mailing or personal delivery of notice of the decision after such a hearing, the employer may take an appeal to the appeal board by filing a notice of appeal with the commissioner. * * * ”

The Commissioner has not exercised the power expressly conferred by that section to “ determine the amount of contribution ” due from an employer who has failed to file a report or has filed a report which is incorrect or insufficient. The Commissioner cannot determine whether Electrolux Corporation is bound to include in its report the compensation paid to its sales representatives ” unless the Commissioner obtains information concerning the relations of the sales representatives and the corporation and their contractual rights and obligations. Nor can the Commissioner determine the amount of the contribution due from Electrolux Corporation if its sales representatives ” are employees of that corporation, unless the Commissioner obtains information concerning the compensation or wages paid to each of such employees. The time and effort required would be wasted if an adjudication should be made thereafter that such sales representatives are independent contractors. To avoid such possible waste, the controversy in respect to the status of these persons was submitted to the Commissioner for decision before a determination of the amount of the contribution which would be due from their employer if the decision should be that the relationship of employer and employees exists.

The attorneys for the corporation sent to the Department of Labor letters stating their contentions, together with the contracts upon which these contentions were based. They received notice that the sales representatives should be considered employees of the Electrolux Corporation rather than independent persons.” The notice concluded with the words if your client claims to be aggrieved by this determination it may apply to the Industrial Commission for a hearing within twenty days pursuant to Section 523 of the New York State Unemployment Insurance Law.” Acting upon this advice, the Electrolux applied for a hearing, which was thereafter held. It appealed to the Appeal Board from the adverse decision of the Commissioner rendered after that hearing and, unsuccessful before the Appeal Board,-it began this proceeding for a judicial review of the decision of the Commissioner. Only then did the Industrial Commissioner urge that the statute did not authorize her to decide that the sales representatives are employees except in connection with á determination made in accordance with section 523, subdivision 1, fixing the amount of the contribution due from the employer.

Though we agree that the statute does not, in express terms' or by implication, confer upon the Commissioner power to make advisory or declaratory decisions defining obligations arising under the statute, the statute does not attempt to provide a rigid procedure for the administration of the Unemployment Insurance Fund. It leaves room for the exercise of discretion by the Commissioner charged with responsibility for its administration and in the exercise of that discretion the Commissioner may make rules and orders which, are immediately effective as part of a reasonable procedure for the performance of duties imposed by law.

The duty of the Commissioner to determine the amount of the contribution which all employers ” must pay is imperative under the express terms of the statute, but before the Commissioner can fix that amount, there must be decision of any controversy in respect to who is an employer and who is an employee. The statute is silent as to how or when such a decision shall be rendered. Certainly it might be very inconvenient if a contention that a person is not an employer from whom contribution to the Fund is due could be considered and determined only as part of an order fixing the amount of the contribution due from him because he is an employer. In the same subdivision of section 523 in which the duty to determine the amount of the contribution due from an employer is imposed upon the Commissioner, the statute provides for an appeal from any other rule or order of the commissioner under any provision of this article.” By clear implication the statute confers upon the Commissioner authority to make other rules or orders appropriate to the performance of the duties expressly imposed by any provision of the statute. A grant of power to an administrative officer may not be read into a statute by doubtful implication, but the statute here confers upon the Commissioner by necessary implication both power and duty to determine the persons who are employers and the persons who are employees within the meaning of the statute, in order that the amount of contributions due from an employer may be fixed, and the statute does not restrict the discretion of the Commissioner in respect to how or when a rule or order shall be made determining a controversy in that field.

Here the Commissioner has done just that. The decision rendered is not merely advisory. It constitutes the rule by which the amount of the obligation due from the employer must be measured. It is a determination that any report filed by the employer which fails to include the “ wages ” paid to sales representatives is incorrect. The Commissioner might, we assume, refuse to make such a rule or order except as part of the order fixing the amount due, but the power to make such a decision, as a matter of administrative convenience, upon the application of the employer before the amount due is fixed, in order to avoid possible waste of time and effort by both the Department and the employer, has not been denied to the Commissioner by the statute.

The order of the Appellate Division should be reversed, with costs in this court, and the matter remitted to the Appellate Division to review the decision on the merits.

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

Order reversed, etc.


author: Per Curiam.

text:
    Manhattan Savings Institution, Appellant, v. Gottfried Baking Company, Inc., Respondent.
    Argued June 9, 1941;
    decided July 29, 1941.

      John J. Cunneen for appellant.
    The trial court erred in directing a verdict for the defendant because plaintiff was entitled at least to nominal damages. (Stevens v. Amsinck, 149 App. Div. 220; Hutton v. Tullis, 93 Misc. Rep. 548; Shapiro v. Benenson, 181 App. Div. 19; MacGregor v. Watts, 254 App. Div. 904.)

      Allan R. Campbell for respondent.
    Plaintiff is not entitled to an award of nominal damages. (Matter of City of New York [Northern Blvd.], 270 N. Y. 652; Wells v. Fisher, 237 N. Y. 79; Baird v. Mayor, 96 N. Y. 567; Ruttonjee v. Frame, 237 N. Y. 115; Phelps-Stokes Estates v. Nixon, 222 N. Y. 93; National Cash Register Co. v. Schmidt, 48 App. Div. 472; Los Angeles I. S. Corp. v. Joslyn, 282 N. Y. 438; Stevens v. Breen, 283 N. Y. 196; Matter of Winters v. Prendergast, 211 N. Y. 536; Parsons v. Sutton, 66 N. Y. 92; Stecker v. Weaver Coal Co., 116 App. Div. 772; Haddam Granite Co. v. Brooklyn H. R. R. Co., 186 N. Y. 247; Bradford, E. & C. R. R. Co. v. N. Y., L. E. & W. R. R. Co., 123 N. Y. 316.)
   Per Curiam.

The plaintiff proved that the defendant breached its contract. The question whether the plaintiff suffered substantial damages by such breach is one of fact, and the determination of that question against the plaintiff in the courts below may not be reviewed in this court. The plaintiff was, however, entitled as matter of law to an award of nominal damages.

The judgments should be reversed and judgment directed for the plaintiff for six cents damage, without costs.

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

Judgments reversed, etc.


text:
    Nathan Ginsberg, Appellant, v. City of Long Beach, Respondent.
    Argued June 18, 1941;
    decided July 29, 1941.

      Jacob M. Zinaman for appellant.
    The decision of the Appellate Division as to qualification is based on an issue which was neither pleaded nor raised on the trial. (Lind-lots Realty Corp. v. Suffolk Co., 278 N. Y. 45; Brown v. Manufacturers Trust Co., 278 N. Y. 317; Moses v. Hatch, 21 App. Div. 486; 163 N. Y. 554; Queck-Berner v. Macy, 240 N. Y. 341; H. K. & S. B. Corp. v. Cooper, 114 N. Y. 388; Martin v. Herzog, 228 N. Y. 164; Matter of Einstein, 150 App. Div. 856; 208 N. Y. 588; Shepard v. United States, 290 U. S. 96; Rosenberg v. Wilkens, 127 App. Div. 906.) The Appellate Division erred in holding that defendant was authorized to reduce plaintiff’s salary as health officer during his term of office to a sum below the minimum prescribed by section 21 of the Public Health Law (Cons. Laws, ch. 45). (Matter of Skinner, Cook & Babcock v. 4th Church of Christ, 238 App. Div. 573; Equitable Trust Co. v. McClaire, 135 N. Y. Supp. 1022; People ex rel. Van Denbergh v. Town Board of Colonie, 254 App. Div. 54; Oneida County v. City of Utica, 260 App. Div. 363; Schieffelin v. Leary, 219 App. Div. 660; Matter of Hulbert v. Craig, 124 Misc. Rep. 273; 213 App. Div. 865; 241 N. Y. 525; Adler v. Deegan, 251 N. Y. 467; Matter of Kress v. Department of Health, 283 N. Y. 55.)

      Bernard H. Reich, Corporation Counsel, for respondent.
    The plaintiff, having been a de facto officer, is not entitled to the salary of the office and cannot maintain an action against the city for the compensation to which he would be entitled if he were an officer de jure. (Matter of Hulbert v. Craig, 124 Misc. Rep. 273; 213 App. Div. 865; 241 N. Y. 525; Sheridan v. City of St. Louis, 81 S. W. Rep. 1082; People ex rel. Walton v. Hicks, 173 App. Div. 338; 221 N. Y. 503.) Assuming that the plaintiff was legally the public health officer of the city of Long Beach for some period, the amount of. his recovery is limited to the compensation fixed by the Council for the office in the budget for that period. (Adler v. Deegan, 251 N. Y. 467; Freund v. Hogan, 264 N. Y. 203; Whitmore v. Mayor, 67 N. Y. 21; Ledwith v. Rosalsky, 244 N. Y. 406; People ex rel. Garrity v. Walsh, 181 App. Div. 118; Matter of Hanower v. Gandia, 269 N. Y. 593; People ex rel. Young v. Gulvin, 164 App. Div. 768.)
   Per Curiam.

Plaintiff sued to recover his salary as health officer of the defendant City of Long Beach for the period from December 1, 1936, to February 28,1938. His recovery thereof at Trial Term was reduced by the Appellate Division and the case is now here on his appeal only.

The form in which the issues were submitted authorized the Appellate Division to examine the record de novo. We agree with its conclusion that the office was vacant after June, 1936, because of the plaintiff’s failure to qualify himself therefor in accordance with the directions of the Public Health Council, and that he was, therefore, entitled to no recovery for the period from December 1, 1936, to October 9, 1937, when he was again appointed to the then vacant office on his fulfillment of the conditions which the Public Health Council had imposed.

For the period subsequently to the plaintiff’s appointment on October 9, 1937, the Appellate Division allowed him a recovery upon the basis of his salary as fixed by the City Council in amounts which for part of this period were less than the minimum salary of a health officer prescribed by section 21 of the Public Health Law (Cons. Laws, ch. 45). Plaintiff contends that the City Council had no power so to fix his salary.

We think this contention is not open to him in the face of the undisputed fact that after his appointment on October 9, 1937, he failed to file his official oath of office within the time prescribed by section 30, subdivision 8, of the Public Officers Law (Cons. Laws, ch. 47). On that default the appointment was vitiated and the office again became vacant. (People ex rel. Walton v. Hicks, 173 App. Div. 338; 221 N. Y. 503.)

Plaintiff was thus entitled to no recovery for either of the periods in question and his complaint should have been dismissed. The defendant city cannot now have that relief, however, in view of its failure to appeal to this court.

The judgment should be affirmed, with costs.

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

Judgment affirmed.


text:
    In the Matter of Nancy S. Barns, Appellant, against Nelson C. Osborne et al., Constituting the Board of Appeals of the Village of East Hampton, Respondents.

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

      Reginald C. Smith and J. Leo Saxstein for appellant.

      Raymond A. Smith and Raymond A. Smith, Jr., for respondents.
   Per Curiam.

This proceeding was brought under article ,6-A of the Village Law (Cons. Laws, ch. 64) for an order to review a decision of the Zoning Board of Appeals of the Village of East Hampton in the county of Suffolk. Section 179-b of the statute provides: “Any person or persons, jointly or severally aggrieved by any decision of the board of appeals * * * of the village, may present to a court of record a petition, duly verified, setting forth that such decision is illegal, in whole or in part, specifying the grounds of the illegality. Such petition must be presented to the court within thirty days after the filing of the decision in the office of the board.” (Italics supplied.)

The decision here sought to be reviewed was filed on July 27, 1940. A petition for review thereof together with a notice that the application was one for an order of review were served upon the Board on August 14, 1940, and were made returnable at the Special Term next to be held in Suffolk county on September 7, 1940. All the parties resided in Suffolk county where also their respective attorneys had their offices.

On the return day the Special Term on a cross-motion of the Board of Appeals dismissed the petition on the ground that it had not been presented to the court within thirty days after the filing thereof as required by the foregoing provisions of section 179-b of the Village Law. The Appellate Division affirmed. Petitioner has now brought the matter here by our leave.

We think the petition was presented to the court in the fair sense of section 179-b when (within the time limitation prescribed by that section) the jurisdiction of the court was invoked in accordance with the statutory provisions which regulate the practice respecting motions and orders.

The orders should be reversed, without costs, and the matter remitted to the Special Term for further proceedings in accordance with this opinion.

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

Orders reversed, etc.


text:
    George B. Ray et al., Respondents, v. Canton Co-operative Fire Insurance Company et al., Appellants.

      Argued June 12, 1941;
    decided July 29, 1941.

      Nelson B. Pirnie and Charles B. Sullivan for appellants.
    Even if the claimed statement of the agent to plaintiffs’ grantor that he would look after plaintiffs’ insurance could be held a promise made to plaintiffs, this would not constitute a waiver by defendants of the provision of the policy. (Greentaner v. Connecticut Fire Ins. Co., 228 N. Y. 388; Truglio v. Zurich General Acc. & L. Ins. Co., 247 N. Y. 423; Mapu v. Agricultural Ins. Co., 244 App. Div. 268.)

      Frank C. Mason and Edward L. P. O’Connor for respondents.
    The defendants are bound by the assent of their agent to the transfer of the policy to plaintiffs. (Angell v. Hartford Fire Ins. Co., 49 N. Y. 171; Ruggles v. American Cent. Ins. Co., 114 N. Y. 415; Manchester v. Guardian Assur. Co., 151 N. Y. 88; Ellis v. Albany City Fire Ins. Co., 50 N. Y. 402; Andrews v. Equitable Fire & Marine Ins. Co., 236 N. Y. 573; Squier v. Hanover Fire Ins. Co., 162 N. Y. 552; Barone v. Ætna Life Ins. Co., 260 N. Y. 410; Brennan v. Sun Indemnity Co., 271 N. Y. 182; Pechner v. Phoenix Ins. Co., 65 N. Y. 195; Walker v. Phoenix Ins. Co., 156 N. Y. 628.) The acts and conduct of the defendants and of their agent after the fire show that they recognized the plaintiffs as covered by their policy. (Titus v. Glens Falls Ins. Co., 81 N. Y. 410; Benninghoff v. Agricultural Ins. Co., 93 N. Y. 495.)
   Per Curiam.

Since the policy in suit was at the times in question in the exclusive possession of the plaintiffs, the defendant companies were not bound by the promise of any of their agents that consent to an assignment thereof to the plaintiffs would be endorsed thereon. (Greentaner v. Connecticut Fire Ins. Co., 228 N. Y. 388; Truglio v. Zurich General Acc. & L. Ins. Co., 247 N. Y. 423. See Mapu v. Agricultural Ins. Co., 244 App. Div. 268.) No estoppel against the defendant companies arose from the circumstance that plaintiffs had at their request submitted estimates of the amount of the loss. (Draper v. Oswego County Fire Belief Assn., 190 N. Y. 12.)

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

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

Judgments reversed, etc.


text:
    Berta Walz, Appellant, v. Paul Helfer, Inc., Respondent.
    Argued June 11, 1941;
    decided July 29, 1941.

      Stanley P. Meyerson and Edward L. Coffey for appellant.
    The owner of business premises must exercise affirmative reasonable care to invitees upon the premises to inspect and keep such premises in a reasonably safe condition, and the owner is charged with the duty towards such persons of giving notice or warning of any dangerous condition not apparent to one in the exercise of reasonable diligence. (Haefeli v. Woodrich Engineering Co., 255 N. Y. 442; American Law Institute, Restatement of Torts, vol. 2, § 343, comment e.) The circumstances are sufficient to raise an issue of negligence. (Eisenberg v. Kemp, Inc., 256 App. Div. 698; McDonald v. Liggett Co., 241 App. Div. 913; Thompson v. Palladino, 250 App. Div. 817; 275 N. Y. 633; Haefeli v. Woodrich Engineering Co., 255 N. Y. 442; Laudrie v. Grant Co., 241 App. Div. 904.)

      Milton Turkel for respondent.
    If the floor was wet and slippery, as the appellant claims, she either observed or should have observed its condition, and, therefore, the complaint was properly dismissed. (Powers v. Montgomery Ward & Co., 251 App; Div. 120; Hart v. Grennell, 122 N. Y. 371; Garthe v. Ruppert, 264 N. Y. 290; Fishman v. Brooklyn Jewish Center, Inc., 234 App. Div. 319.)
   Per Curiam.

The record presents issues of fact concerning negligence and freedom from contributory negligence. The washing of the floor of a store during business hours presents a different situation from the cleaning of the stairs of an apartment house (Samuels v. Terry Holding Co., 253 N. Y. 593) or the floor of a railroad station (Curtiss v. Lehigh Valley R. R. Co., 233 N. Y. 554).

The judgments should be reversed and a new trial granted, with costs to the appellant to abide the event. (See 286 N. Y. 700.)

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

Judgments reversed, etc.


text:
    Hyman Rosen, Appellant, v. Equitable Paper Bag Co., Inc., Respondent.

      Argued June 11, 1941;
    decided July 29, 1941.

      Frederick Evan Crane and Samuel Weiss for appellant.
    The appeal being from a judgment of nonsuit, appellant is entitled to the benefit of every fact the jury could have found from the evidence and to every legitimate inference in his favor warranted by the evidence. (Rehberg v. Mayor, 91 N. Y. 137; McNally v. Phoenix Ins. Co., 137 N. Y. 389; Higgins v. Eagleton, 155 N. Y. 466; Koehler v. N. Y. Steam Co., 183 N. Y. 1; Faber v. City of New York, 213 N. Y. 411; Melcher v. Ocean Accident & Guarantee Corp., 226 N. Y. 51; Hoykendorf v. Bradley Contracting Co., 227 N. Y. 204; Ehrenworth v. Stuhmer & Co., Inc., 229 N. Y. 210; Brady v. Nally, 151 N. Y. 258; Crowley v. Lewis, 239 N. Y. 264; Cobb v. Knapp, 71 N. Y. 348; Higgs v. de Maziroff, 263 N. Y. 473.) The Appellate Division erred in affirming the judgment dismissing the complaint on the ground that there was no proof of damage to sustain a verdict against the defendant. (Higgs v. de Maziroff, 263 N. Y. 473; Loomis v. N. Y. C. & H. R. R. R. Co., 203 N. Y. 359; Pierson & Co. v. Nederlandsch-Indische Maatschappij, Ltd., 203 App. Div. 365; Howard v. Daly, 61 N. Y. 362; Chase Nat. Bank v. Rosenbaum, 254 N. Y. Supp. 593; May Dept. Stores v. Chasin, 190 N. Y. Supp. 594; Paltey v. Egan, 200 N. Y. 83; Hoose v. Drumm, 281 N. Y. 54.) The jury having been without a specific exception charged that any verdict for the plaintiff was to be for the sum of $12,972, the verdict for the plaintiff was properly amended to include that sum. (Fox Co. v. Wohl, 255 N. Y. 268; Hodgkins v. Mead, 119 N. Y. 166; Higgs v. de Maziroff, 263 N. Y. 473; Loomis v. N. Y. C. & H. R. R. R. Co., 203 N. Y. 359; Dalrymple v. Williams, 63 N. Y. 361; Hooper v. Beecher, 109 N. Y. 609.)

      Charles H. Kelby, William F. Beeler and Nathan D. Shapiro for respondent.
    The contract is unambiguous and its construction was a matter for the trial court and not for the jury. The trial court properly construed the contract to be conditional and dismissed the complaint on the merits. (Brady v. Cassidy, 104 N. Y. 147; Sattler v.
      Hallock, 160 N. Y. 291; First Nat. Bank v. National Surety Co., 228 N. Y. 469; Maginn v. Lancaster, 100 Mo. App. 116; Wightman v. New York Life Ins. Co., 119 App. Div. 496; Studwell v. Bush Co., 206 N. Y. 416.) The plaintiff wholly failed to prove agency and damages. The complaint was properly dismissed on the merits. (Jenkins v. Moyse, 254 N. Y. 319; Matter of Batemen, 7 Misc. Rep. 633; 145 N. Y. 623; King v. Minnerly, 156 App. Div. 918; Lowendahl v. Baltimore & Ohio R. R. Co., 247 App. Div. 144; 272 N. Y. 360; Pagel, Horton & Co., Inc., v. Harman Paper Co., 236 App. Div. 47; Sacks v. Anne Beatty Co., 131 Misc. Rep. 117; Bank of United States v. Manheim, 264 N. Y. 45; Matter of Case, 214 N. Y. 199; Matter of Bennett, 238 N. Y. 583; Logan v. Guggenheim, 230 N. Y. 19.)
   Lehman, Ch. J.

The plaintiff, a building contractor, had negotiations with the defendant for the erection of a building for the occupancy of the defendant corporation upon land which officers of the defendant corporation were about to purchase. On June 28, 1939, a written contract for the erection of the proposed building by the plaintiff was made, not with the defendant corporation but with Esthall Realty Co., Inc., described in the contract as_a “ domestic corporation, now in process of organization, having its principal place of business at 50 Court Street, Brooklyn, New York, which corporation is to be the owner in fee of the premises hereinafter described.” That corporation was thereafter organized but did not proceed with the erection of the building as planned. The plaintiff then brought this action against the defendant to recover the loss of the profits which it would have made if the building had been erected and paid for in accordance with the contract of June 28th.

Since the defendant did not sign the contract and is not named as a party, it denied liability for any breach of_the contract by Esthall Realty Co., Inc., which may have occurred. It also claimed that under the terms of the written contract, Esthall Realty Co., Inc., reserved the right to determine whether or not it would thereafter proceed with the building and assumed no obligation or liability unless thereafter it should give notice to the plaintiff to begin work. At the trial testimony was introduced intended to show that Esthall Realty Co., Inc., was formed for the convenience of the defendant corporation, had the same stockholders and was under the same control; that the plaintiff and the defendant understood tha,t it would act as the agent of the defendant in all matters connected with the contract, and that the plaintiff, upon the suggestion of the defendant, relied upon the credit of the defendant. Testimony was also received intended to show that it was understood and agreed that, under the terms of the contract, Esthall Realty Co., Inc., acting as agent for the defendant corporation, assumed an absolute obligation to give notice to the plaintiff to begin construction of the building on or before July 6, 1939. The defendant produced testimony to the contrary. The trial judge submitted to the jury, as questions of fact, both whether Esthall Realty Co., Inc., acted as agent of the defendant in making the contract and whether under the terms of the contract the defendant, or Esthall Realty Co., Inc., its agent, assumed an absolute obligation to proceed with the erection of the building, though reserving some discretion as to the time when the plaintiff should be directed or permitted to begin' work. In accordance with a stipulation of the parties a sealed verdict was ordered which might be opened in the absence of the jury with the same effect as if it were present. The jury found in its sealed.verdict for the plaintiff.

The trial judge had, in effect, though perhaps not in clear language, charged the jury that if the jury’s verdict should be in favor of the plaintiff the jury should find damages in the sum of $12,972, and when the jury brought in a verdict in favor of the plaintiff without stating the amount of damages found, the plaintiff’s attorney moved to amend the verdict to read, Verdict for the plaintiff in the sum of $12,972, with interest.” At the same time the defendant moved to set aside the verdict. The trial judge reserved decision on both motions. Thereafter the court granted the motion to amend the verdict but also granted the motion by the defendant to set aside the verdict, as amended, on the ground that it was against the weight of evidence. The court went further and, having reserved decision upon the defendant’s motion made at the close of the case to dismiss the complaint, the court now granted the motion and dismissed the complaint. The ground of the dismissal was that, upon reflection, the court had determined that, under the terms of the contract, Esthall Realty Co., Inc., or the defendant corporation, its alleged principal, assumed no obligation unless thereafter it chose to notify the plaintiff to proceed.

The plaintiff appealed to the Appellate Division from the order of the court granting the defendant’s motion to set aside the verdict and directing the entry of a judgment dismissing the complaint. The defendant cross-appealed from that order in so far as it granted plaintiff’s motion to reform the verdict of the jury so as to specify damages. The Appellate Division modified the order in so far as it granted the motion to reform ” the verdict but otherwise affirmed the order. The plaintiff has appealed to this court from the judgment of dismissal entered upon the order of the Appellate Division. The Appellate Division in a brief memorandum stated that the plaintiff had failed to prove damages and was not, as matter of law, entitled to the damages inserted in the verdict as amended.

The primary question presented upon this appeal is whether under the terms of the written agreement, either the defendant or its alleged agent assumed any absolute obligation to proceed with the building or whether the obligation should arise only after notification was given to the plaintiff. The contract provides that, 11 It is hereby agreed between the Owner and the Contractor that completion for beneficial use and occupancy on November 20th, 1939, is of the essence of this contract, and is a paramount factor in the awarding of this contract to Contractor;” and it provides that for failure to complete the contract on or before that date the contractor shall pay liquidated damages of $100 per day “ for every day said work is not entirely completed after November 20th, 1939.” These clauses are followed by the following provisions or conditions:

“ PROVIDED, however, that it is understood and agreed between the Owner and the Contractor that no work shall be done by the Contractor either at the building site or elsewhere until notice is given by the Owner to the Contractor to proceed and no obligation to the Owner shall be incurred by the Contractor under this agreement until the Owner shall have notified the Contractor in writing to proceed with the work; it being the intention of the Owner to give such notification to the Contractor on or before July 6th, 1939.
The Owner is to furnish the Contractor and have ready for submission and fifing drawings with the Building Department on or before July 19,1939.
In the event that the approval of the Building Department is not obtainable by July 21, 1939, then and in that event the completion date, November 20, 1939, shall be extended the number of days beyond July 21, 1939 that are required to obtain such approval.”

Under the construction of that proviso now urged by the defendant, the plaintiff’s obligation would be absolute while the defendant would be under no obligation to proceed unless thereafter it chose to do so. The defendant could, if it so desired, insist upon an absolute promise from the plaintiff while at the same time binding itself only conditionally or even, by apt language, reserving to itself an option whether it should thereafter proceed with the building in accordance with the stipulations of the written instrument; but in this case it has certainly not done so in unambiguous language. Though the instrument provided, “No obligation to the Owner shall be incurred by the Contractor under this agreement until the Owner shall have notified the Contractor in writing to proceed with the work,” a reciprocal obligation on the part of the owner “ to give such notification to the contractor on or before July 6th, 1939,” or, perhaps, within a reasonable time thereafter, may be read into the instrument by fair implication. The contract is, in our opinion at least, open to such construction and the trial judge erred in giving to the instrument a different construction as matter of law.

It would serve no purpose to analyze the evidence intended to show that Esthall Realty Co., Inc., acted as the agent of the defendant in signing the contract. It seems clear to us that upon that point the record presents a question of fact properly submitted to the jury. The question remains, however, whether the complaint was properly dismissed because the plaintiff failed to'prove damages.

The contract provides that

“ The consideration to be paid by the Owner to the Contractor shall be the sum of Two hundred Seventy Seven Thousand Six Hundred and Eleven Dollars ($277,611.00), which the Contractor hereby agrees shall not be exceeded except by written authorization of the Owner.

Contract price above stated shall include the sum of Twelve Thousand Nine Hundred and Seventy Two Dollars ($12,972.00) for basic construction fee, plus Two Hundred and Sixty Four Thousand Six Hundred and Thirty Nine Dollars ($264,639.00) for basic Actual Cost of labor and material required for the completion of the work included in the

“ Building Specifications dated May 29,1939

Plumbing Specifications dated June 14, 1939

“ Heating Specifications dated June 14, 1939

“ Electrical Specifications dated June 16,1939

. Sprinkler specifications dated June 13, 1939

and Contract Supplements thereto dated June 28th, 1939, and as indicated on the drawings of the Architects and Engineers, The Ballinger Company, subject however, to additions and deductions upon signed authorization of the Owner as hereinafter provided.

It is further understood and agreed between the Owner and the Contractor that in the event of the Basic Actual Cost of all labor and material required, not including Contractor’s Basic Construction Fee of $12,972.00, being less than $264,639.00, subject to additions and deductions, as hereinafter provided, any such saving shall accrue to the benefit of the Owner and of the Contractor in the proportions of Fifty percent (50%) and Fifty percent (50%) respectively.”

We find in the instrument no agreement to pay the plaintiff $12,972 for basic construction fee ” if basic actual cost of labor and material ” should exceed $264,639. It seems clear to us that the plaintiff, in effect, agreed that actual cost should not exceed $264,639, and he assumed the risk that the actual cost might be greater than its estimated amount. If the cost should be less, one-half the saving would accrue to the benefit of the owner. If the cost proved greater than anticipated, the plaintiff might have no profit or even sustain a loss. His damages, therefore, are, as the Appellate Division' has held, the difference between the stipulated price of $277,611, and the actual cost of completion of the contract. The plaintiff attempted to prove those damages but his evidence was excluded upon the objection of the defendant. He should have opportunity to prove them upon a new trial. The complaint should, therefore, not have been dismissed for failure of proof.

The judgments should be reversed and a new trial granted, with costs to the appellant to abide the event. (See 286 N. Y. 698.)

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

Judgments reversed, etc.


text:
    The People of the State of New York, Respondent, v. Calvar Corporation and Andrew La Grega, Individually and as President of Calvar Corporation, Appellants.
    Submitted May 20, 1941;
    decided July 29, 1941.

      Joseph H. Gellman for appellants.
    The building zone ordinance as applied in this case is unconstitutional. (Bartsch v. Ragonetti, 123 Misc. Rep. 903; 214 App. Div. 799; People v. Linabury, 209 N. Y. Supp. 126; Town of Harrison v. Sunny Ridge Builders, Inc., 169 Mise. Rep. 471; 170 Misc. Rep. 161; Pennsylvania Coal Co. v. Mahon, 260 U. S. 393; People v. Hawley, 207 Cal. 395; Stone v. Kendall, 268 S. W. Rep. 759.)

      Edward J. Neary, District Attorney (Philip Huntington of counsel), for respondent.
    The building zone ordinance,as applied in this case, is constitutional. (People ex rel. Ventres v. Walsh, 121 Misc. Rep. 494.)
   Lehman, Ch. J.

The defendants have been convicted of violations of the Building Zone Ordinance of the Town of Hempstead. The defendant corporation is the owner of land in that town, and is engaged there in the business of excavating sand for sale. It has erected upon the land, for use in the conduct of its business, small one-story buildings or sheds without foundation and easily removable. The premises are situated in a district which, under the Zoning Ordinance, has been designated as a “ B Residence District.” The use of premises within that district for business purposes is restricted or prohibited. The defendants have been found guilty of conducting there a business in violation of the Zoning Ordinance.

The defendants’ violation of the ordinance as written is clear. They contend, however, that the ordinance if construed in manner which would prohibit the owner of land from removing sand, gravel, or other deposit would constitute a taking of the owner’s property which is prohibited by the Constitution unless fair compensation is paid. Restrictions upon the use of property within reasonable limits for the common good are valid. The defendants maintain that such restrictions are unreasonable where they impair “ the rights of ownership of the earth in its physical, tangible sense.” Whether or not a restriction is reasonable may depend on many factors. No single factor is ordinarily decisive. “ The general rule at least is, that while property may be regulated to a certain extent, if regulation goes too far it will be recognized as a taking. * * * A strong public desire to improve the public condition is not enough to warrant achieving the desire by a shorter cut than the constitutional way of paying for the change. As we already have said, this is a question of degree — and therefore cannot be disposed of by general propositions.” (Pennsylvania Coal Co. v. Mahon. 260 U. S. 393, 415, 416.)

The defendants’ property is situated in an undeveloped section of the town. Excavation of sand from the property and the erection of temporary buildings, for use in connection with such excavation, would, so far as appears, not cause any serious present substantial injury to the neighborhood. Forceful argument may be made that a general and complete prohibition of such use of property, even where such use might be permitted without causing substantial injury to the community, would be unreasonable. That question must await determination until it arises. We express no opinion upon it. In this case there has been no such complete and absolute prohibition.

The Zoning Ordinance provides for a Board of Appeals, which may “ determine and vary the application of the regulations herein established in harmony with their general purpose and intent as follows: * * * (2) In undeveloped sections of the town, authorize the issuance of temporary and conditional permits for a period not to exceed five (5) years for structures and uses in contravention of the requirements of this ordinance.” Upon application by the defendants the Board of Appeals might authorize the issuance of a temporary permit to do those acts which, without such permit, constitute a violation of the ordinance. Refusal to grant such a permit in proper case, if not reviewable by the courts, might result in unlawful deprivation of the defendants’ property. There has been no such deprivation until there has been application for a permit and unreasonable refusal, and a statute does not violate the Constitution where it does not deprive an owner unreasonably of his property if the statute is properly administered in accordance with its terms. (Dowsey v. Village of Kensington, 257 N. Y. 221.) .

Perhaps there has already been application and denial in this case, but that does not appear from the record and the appellants are not asking here a review of any determination by the Board of Appeals denying such an application. Only in proceedings brought to review such a determination, if made, could the court review the action of the Board, or determine whether the ordinance has been administered in manner so unreasonable that enforcement would constitute an unlawful taking of the defendants’ property.

The judgment should be affirmed.

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

Judgment affirmed.