author: Lewis, J. Puld, J.

text:
    In the Matter of Jacob Zellner, Appellant. Brooklyn Trust Company, as Trustee for Certificate Holders of Bond and Mortgage Guarantee Co., Respondent.
    Argued February 23, 1949;
    decided May 26, 1949.

      Armende Lesser for appellant.
    I. The rental charged for the leasehold is unjust, unreasonable and oppressive and is in excess of the emergency rent required to be paid by chapter 3 of the Laws of 1945. II. The allowance of a managing agent’s fee by the Appellate Division is not supported by the record. III. The additional allowance of 15% is contrary to the statute. (Matter of Frankel [Hatters’ Oakhide Boxes], 269 App. Div. 531.)

      Henry J. Walsh, Jr., and Walter F. O’Malley for respondent.
    The finding made by the Appellate Division as to the fair rental to be charged does not violate the statute. (Schack v. Handel, 271 App. Div. 1.)
   Lewis, J.

This is a proceeding by a tenant to fix emergency rent under the provisions of section 2, subdivision (e), chapter 3 of the Laws of 1945 (McKinney’s Unconsol. Laws, § 8522, subd. [e]), known as the Commercial Bent Control Law.

The proceeding was initiated by an order to show cause dated February 27, 1945, returnable at Special Term, Kings County. Subsequently the report of a referee — which made no specific findings — was confirmed by Special Term, but reversed by the Appellate Division and remitted to Special Term with instructions to make a decision and to indicate the findings upon which it was made. (270 App. Div. 941.) Upon that remission Special Term again referred the proceeding to a referee whose report was modified by Special Term and, as so modified, was confirmed. Upon cross appeals the Appellate Division modified the order of Special Term — making a new finding of fact and reversing all inconsistent findings — and, as so modified, the order was unanimously affirmed. (273 App. Div. 906, 907.) The proceeding is here on appeal by the tenant only from the order of the Appellate Division.

On December 15, 1944, the respondent, Brooklyn Trust Company, as trustee for mortgage participation certificate holders, while operating the building in suit under an assignment of rents, leased the premises to the petitioner-appellant for a term of five years from January 1, 1945, at an annual rent of $5,400. Under that lease the tenant was obligated to make necessary repairs. As the lease was made on December 15,1944 — prior to the enactment of the Commercial Rent Control Law (L. 1945, ch. 3) — no question arises as to an intentional evasion of that statute. On December 30, 1944, respondent acquired the fee by deed in lieu of foreclosure, which deed expressly negatived merger of the mortgage in the fee. Shortly thereafter, the Commercial Rent Control Law became effective and thereupon petitioner instituted this proceeding based upon the claim that the rent reserved in the lease was in excess of the emergency rent permitted by the statute.

The Commercial Rent Control Law (L. 1945, ch. 3, § 2, subd. [e]) — which was in effect without amendment at the time this proceeding was instituted — defines 1 ‘ emergency rent ’ ’ as “ The rent reserved or payable under any lease, agreement or tenancy of commercial space in force on March first, nineteen hundred forty-three, plus fifteen per centum of such rent; provided that if the commercial space was not used or occupied on such date for commercial purposes, the emergency rent shall be the reasonable rent therefor .as of such date, plus fifteen per centum thereof, to be fixed by agreement, by arbitration, or by the supreme court upon the basis of the rent charged on such date for the most nearly comparable commercial space in the same building or other satisfactory evidence.” ■ (Emphasis supplied.)

The property here involved is located at 9A-100 Putnam Avenue in Brooklyn and consists of a corner lot entirely occupied by a four-story building which is about fifty years old and in a state of poor repair. On March 1,1943 — the controlling date of the statute quoted above — the building was occupied by the then owner and was operated as a garage.

It thus appears that on March 1, 1943, the building was producing no rent which could serve as a base for determining emergency rent under the statute and, accordingly, that part of the statutory definition of “ emergency rent ” found in subdivision (e) of section 2 quoted (supra) — viz. “rent reserved * * * plus fifteen per centum of such rent ” — does not apply. Nor is the remaining language of that section precisely applicable to controlling facts in this case because, although the building was used on March 1, 1943, for a commercial purpose (subd. [b] id.), it was not then rented. However, the Justice at Special Term ruled that the word “ used ”, as it appears in the statute, should be construed to include “ rented ”, and that accordingly the latter part of the section is applicable. Furthermore, since the lease here involved covered the property in its entirety, there is no “ comparable commercial space in the same building ” (§2, subd. [e] id.) producing rent which would serve as a factor to be considered in determining ‘ ‘ emergency rent. ’ ’

It was in those circumstances that the Justice at Special Term adopted the course now challenged by the appellant but which has met with the approval of the Appellate Division and which we now approve. Mindful that the statute (§ 2, subd. [e] id.) directed that “ the emergency rent shall be the reasonable rent therefor as of such date [March 1, 1943] ” and relying upon the authority expressly given by that statute to the Supreme Court to use “other satisfactory evidence” as a “basis” for determining “ emergency rent ”, the Justice at Special Term turned to the method of fixing “ reasonable rent ” as set forth in section 4 of chapter 3 of the Laws of 1945 (as amd. by L. 1945, ch. 315 — and see McKinney’s Unconsol. Laws, § 8524). That section provides in.part: “ In the determination of the amount of such reasonable rent: (a) due consideration shall be given to the cost of maintenance and operation of the entire property (including land and building in which such commercial space is located) including amounts paid for taxes assessed against such property, and to the kind, quality and quantity of services furnished, but excluding amortization or interest paid or accrued on any incumbrances thereon * * * . A net annual return of six per centum on the fair value of the entire property including the land plus two per centum of principal for amortization of any mortgages thereon shall be presumed to be a reasonable return. The assessed valuation of the entire property, including land and building, as shown by the latest completed assessment-roll of the city, shall be presumed to be the fair value of the premises, but other lawful evidence of the fair value may be offered and received.” To the “reasonable rent ” so derived as of March 1,1943 — not as of the date the application was made — Special Term added 15% as expressly authorized by subdivision (e) of section 2 of chapter 3 of the Laws of 1945 (quoted supra) to arrive at the “ emergency rent ” prescribed by law.

Our thought is that in the circumstances disclosed by this record the process by which the courts below determined the appropriate emergency rent was permissible within the unequivocal language chosen by the Legislature to express its purpose and the means by which that purpose may be accomplished. We may assume that by expressly authorizing the Supreme Court in its discretion to use “ other satisfactory evidence ” (§ 2, subd. [e] id.) as a basis for determining emergency rent, the Legislature intended that phrase to serve some purpose. (People v. Dethloff, 283 N. Y. 309, 315; Allen v. Stevens, 161 N. Y. 122, 145; Palmer v. Van Santvoord, 153 N. Y. 612, 616.) We cannot say as a matter of law that the purpose served in this instance by the authorized use of “ other satisfactory evidence ” to determine emergency rent was not within the Legislature’s intent.

With the exception of one item, to which reference will presently be made, we conclude that the order of the Appellate Division does not transcend authority granted by the statutes cited above. That order modified the order of Special Term on the law and the facts by striking out $5,140.79 as the total emergency rent fixed by Special Term and inserting in its place $5,334.85. The items which comprise the total figure last mentioned above and the computation by which that figure is reached are set forth in the following new finding made by the Appellate Division: “ ‘ The proper items and amounts to be taken into consideration as cost of maintenance and operation are, taxes, $1,550.50; insurance, $418.50; and managing agent, $270, making a total of $2,239, to which should be added the sum of $2,400, representing six per centum of $40,000, the value of the property, making á total of $4,639, fifteen per centum of which, or $695.85, should further be added thereto, making a total of $5,334.85.’ ” (273 App. Div. 906, 907.)

The above items which the Appellate Division found to be properly included within the cost of maintenance and operation of the building do not include a trustee’s fee of $96.25 which Special Term had ruled should be so included. We disregard that omission in view of the fact that upon the present appeal neither party has made reference to it.

There remains for consideration, however, the appellant’s challenge to the new finding by the Appellate Division insofar as it includes a managing agent’s fee in the amount of $270 as an appropriate item of cost of maintenance. That item being one not found by the Justice at Special Term, we have reviewed the facts relating thereto. (Civ. Prac. Act, § 605; Harrington v. Harrington, 290 N. Y. 126,. 130.) As to that item our conclusion is that the weight of evidence fails to establish that the respondent landlord actually maintains a managing agent whose functions relate to this particular property of which the plaintiff leases the entire building and as to which he is required to make all repairs at his own cost.

The order of the Appellate Division should be modified by striking the item “ managing agent, $270 ” from those items set forth in the new finding by the Appellate Division to be taken into consideration in ascertaining the cost of maintenance and operation of the property in suit, and the computation by which the total emergency rent is determined should be modified accordingly, and as so modified the order should be affirmed, with costs to the appellant.

Puld, J.

(dissenting). The Commercial Bent Law sets up in different sections two distinct procedures for determining and computing the amount of rent which a landlord of commercial space is entitled to receive during the war-created emergency (L. 1945, ch. 3, § 2, subd. [e] ; § 4; McKinney’s Unconsol. Laws, § 8522, subd. [e]; § 8524), one for the purpose of determining the “ emergency rent ” (§2, subd. [e]), and the other for the purpose of ascertaining the “ reasonable rent ”, a rent, the statute specifies, ‘ ‘ exceeding in amount the emergency rent ” (§ 4). The two procedures — as well as the elements to be considered under each — are obviously not meant to be interchangeable, dealing as they do with entirely different aspects of the commercial rent control problem.

In spite of the patent attempt by the Legislature to make the distinction plain, the lower courts have, in a proceeding under section 2 (e) to fix the emergency rent, imported and assimilated into that section the formula and the standards set up in section 4. In approving that procedure, this court is not, I very much fear, paying sufficient heed to the fact that the Legislature has defined the section 4 reasonable rent as one “ exceeding ” in amount the section 2 (e) emergency rent. In' consequence, the “ emergency rent ” has been fixed at an amount which is equivalent to 115% of the concededly larger “ reasonable rent ’ ’.

Analysis of the statute illumines the error. Section 2 (e) allows a landlord to collect an “ emergency rent ”, arrived at by taking the rent charged for the premises on the freeze date, March 1, 1943, and adding to it 15%. The determination of an emergency rent is thus a mere mathematical computation. To take care of those instances in which the premises were not used or rented for commercial purposes on that date — with the result that no specific rental charge is available — the same section provides that the emergency rent be fixed at 15% above an estimated figure, which is called the reasonable rent ” for the premises. Parenthetically, it is the use of the word “ reasonable ” therein that is responsible for the confusion that has arisen. This section 2 (e) reasonable rent is to be computed by looking to the rent charged on the freeze date for the most nearly comparable space in the same building ” or, where that is impossible, as it true here, by referring to other satisfactory evidence.”

Nothing in section 2 (e) tells us, it is true, what is to constitute such “ other satisfactory evidence ” of reasonable value. But it is clear, from the statute’s design, its structure and its language, that the phrase refers to such evidence as will tend to establish the actual market value of the rented space as of March 1,1943. That was a date when — section 1 of the statutes indicates — competitive conditions and free bargaining were still reflected in the rental market, and when rents were presumably neither unjust nor oppressive. The Legislature evidently believed that such figures afforded a valid basing point for emergency rent, but, cognizant of the general increase in price levels between the freeze date and the date of the statute’s enactment in 1945, it went on to provide that 15% was to be added to either the reserved rental, or to the figure approximating that amount, namely, the reasonable rent. The figure thus derived, the emergency rent, was to be allowed without regard to the landlord’s peculiar circumstances and costs or to the income from his property. It was neither designed to reflect the landlord’s needs nor to assure him any minimal return on his investment.

Then, desirous of alleviating hardship when the emergency rent ” as thus computed operated unfairly in particular cases because of greatly and disproportionately increased costs of operation, the Legislature wrote section 4 into the statute. (See Matter of Fifth Madison Corp. [New York Tel. Co.], 297 N. Y. 155, 161.) The basic scheme of that section was to permit the landlord a fair net return — presumptively, 6% — on his investment, by taking into account his own individual problems, such as costs of operation and of maintenance, taxes and mortgage debts. That this is true — that the reasonable rent of section 4 is to reflect a return on investment and not the market rental value of the premises — is readily ascertainable from the language of the section itself. In so many words, it provides that, upon proper showing, a landlord may obtain a reasonable rent ”, a rent exceeding in amount the emergency rent ” fixed under section 2 (e), i.e., one designed to assure him a reasonable return.” Thus, section 4 declares that ‘ ‘ A rent, exceeding in amount the emergency rent, may * * # be fixed * * * by the supreme court. The rent to be so fixed shall be a reasonable rent based on the fair rental value of the tenant’s commercial space as of the date the application to the supreme court * * * is made. In the determination of the amount of such reasonable rent: (a) due consideration shall be given to the cost of maintenance and operation of the entire property * * * taxes * * * and to the kind. quality and quantity of services furnished * " *. A net annual return of six per centum on the fair value of the entire property including the land plus two per centum of principal for amortization * * * shall be presumed to be a reasonable return.”

It impresses me as self-evident that the basic and vital differences between the standards prescribed by section 2 (e) and those prescribed by section 4 preclude resort to the latter’s “ net annual return ” formula in a proceeding to determine emergency rent under section 2 (e). Such a process would in no wise assure a rental based, as section 2(e) contemplates and requires, on the freely-bargained rental rates prevailing on the freeze date, plus 15%, and, indeed, to employ the same might well yield the highly anomalous and unfair result of permitting the landlord to obtain as emergency rent — under section 2 (e) — an amount 15% higher than he could possibly have obtained as reasonable rent under section 4, which by definition is to exceed the emergency rent. It would require the court to start with a greater figure and add thereto in order to reach a smaller figure.

Mere statement demonstrates the impropriety of that procedure and the use of a few equations points it up beyond dispute. If the section 2 reasonable rent equals BE2 ”, and its emergency rent equals “ EE ”, then, under section 2 (e),

EE2 + 15% = EE.

And, if the section 4 reasonable rent equals EE4 ”, and the increase necessary to insure the landlord’s desired fair return (designated as reasonable rent), equals “X”, then, under section -4,

EE -f X = EE4.

Now, in the case before us — wherein we are seeking EE ” — the courts below have taken EE4 ” and added to it 15%. What has been done is graphically reflected by the following equation:

EE — EE4 (which equals EE + X) + 15%.

It requires no mathematician, no logician, to recognize that there must be a flaw in the process which produces such a result. The reasoning employed disregards the legislative design and plan embodied in section 4. It overlooks the definition of reasonable rent in that section as a figure “ exceeding in amount the emergency rent ” and incorrectly uses that figure as the core and foundation in computing the emergency rent under section 2. But it does not stop there; it then compounds the error by adding 15% more to the already oversized starting sum. Such a result, it is plain, was and can be achieved only by misconstruing the statute’s language, only by upsetting the Legislature’s design.

It is no answer that the courts below applied the formula under section 4 as of March 1, 1943, rather than as of the date of the application. March, 1943, was deep within the war period; operating expenses, taxes, and other costs may have been as inflated and abnormal on that date as they were on the date of petitioner’s application. The vice involved in using the section 4 formula in any manner, in connection with a section 2 (e) proceeding to fix the emergency rent, is that, although the statute permits but 15% to be added to the March 1,1943 reasonable rent, use of that formula will frequently yield a figure in excess of that.

For these reasons, the criteria and formula contained in section 4 cannot correctly be used and received as ‘ ‘ other satisfactory evidence ” of March 1, 1943 rental values in a proceeding brought under section 2 (e). To put it shortly, the data which section 4 refers to are no more applicable in computing the section 2 reasonable rental value of the premises on March 1, 1943, than they are indicative of the rent actually reserved in a lease in force on that date.

The “ other satisfactory evidence ”, contemplated by section 2, may, of course, be furnished in a number of ways — and I but suggest expert testimony as to prevailing rates for equal amount of space in similar neighborhoods and comparable buildings. Such evidence, and other facts bearing on the issue of market value on the freeze date, would undoubtedly come forth if another hearing were to be held.

In my judgment, the order of the Appellate Division should be reversed and the matter should be remitted to Special Term for a determination of the emergency rent ” upon the basis of criteria which are proper under subdivision (e) of section 2 of the Commercial Rent Law.

Conway, Dye and Bromley, JJ., concur with Lewis, J.; Fuld, J., dissents in opinion in which Loughran, Ch. J., and Desmond, J., concur.

Ordered accordingly.


source: Caselaw Access Project

author: Lewis, J. Desmond, J.

license: Public Domain

text:
    C. Monteith Gilpin et al., Appellants-Respondents, and Nathan W. Shapiro et al., Respondents, v. Mutual Life Insurance Company of New York, Respondent-Appellant, and Manufacturers Trust Company, Respondent. Mutual Life Insurance Company of New York, Landlord, Appellant-Respondent, v. Vincent Fiore et al., Tenants, Respondents-Appellants, and Nathan W. Shapiro et al., Tenants, Respondents.
    Argued February 28, 1949;
    decided May 26, 1949.

      John F. X. Finn and Norman C. Mendes for tenants, appellants and respondents.
    I. When the question presented upon an appeal involving the interpretation of emergency rent laws has, by' lapse of time, laches of the appellant, and the changed course of fluid events, become academic and moot, the court will refuse to decide the abstract question and will dismiss the appeal. (Delavan v. New York, N. H. & H. R. R. Co., 216 N. Y. 359; Matter of Costello [O’Leary], 268 App. Div. 223; Matter of Norton, 158. N. Y. 130; Matter of Lyon Co. v. Morris, 261 N. Y. 497; Bryant v. Thompson, 128 N. Y. 426; Public Nat. Bank v. National City Bank, 261 N. Y. 316; Matter of Grossman, Inc., v. Staff, 252 App. Div. 886.) II. Under the Emergency Bent Control Laws (L. 1945, ch. 3; L. 1945, chs. 314, 315; L. 1946, ch. 273, § 8, subd. [c]) tenants may not be dispossessed' upon any theory of an immediate intention to demolish an old building and erect a new one unless the “ plans for such construction have been approved by the proper authorities, if such approval is required by law ’ ’; and in the case at bar the proper authorities have not approved any plans of the landlord or any plans of anyone other than the now abandoned plans of the trust company. (Quaker Oats Co. v. City of New York, 295 N. Y. 527; Russell Hardware & Implement Mfg. Co. v. Utica Drop Forge & Tool Co., 195 N. Y. 54; Smith v. Bouton, 221 App. Div. 317; Peck v. Goodberlett, 109 N. Y. 180.) III. Under the Emergency Bent Control Laws (L. 1945, ch. 314, § 8, subd. [c], as amd.) there are three reasons why plaintiffs may not be evicted or removed, inasmuch as this is not a case in which “ the landlord ” seeks in good faith to recover possession for the “ immediate purpose ” of demolishing the building or other rental area with the intention of constructing a new building. And the emergency statute abolished holdover tenancies, so that in the circumstances presented by the case at bar, dispossess proceedings against statutory tenants such as appellants must be dismissed, inasmuch as the Civil Practice Act provides that only holdovers may be evicted. (Blitzkrieg Amusement Corp. v. Rubinstein Bros. Drinks, 184 Misc. 975; People ex rel. Durham Realty Corp. v. LaFetra, 230 N. Y. 429.) IV. The contemplated demolition and construction was not to be done by ‘ ‘ the landlord ’ ’ but rather by the trust company which was not and is not the landlord; and the landlord is merely endeavoring to substitute one tenant for a group of existing tenants, which the statute does not authorize. (Tishman Realty & Constr. Co. v. Wolf, 185 Misc. 317; Trade Accessories v. Bellet, 184 Misc. 962; Straus-Duparquet v. Moglen, 185 Misc. 831; Catmon v. Gordon, 181 Misc. 950; Ostrowe v. Lee, 256 N. Y. 36.) V. Possession was not and is not sought for the “ immediate ” purpose of demolishing and constructing. VI. There are no holdover tenancies during the period of the emergency ■ defined in the Emergency Rent Control Laws; and the Civil Practice Act does not permit the dispossession of statutory tenants. Since the proof establishes that the plaintiffs are emergency tenants and not holdover tenants, the dispossess proceedings instituted by the landlord must be dismissed as matter of law. (Kaplan v. Manufacturers Trust Co., 186 Misc. 784.) VII. Since at the time of the execution of plaintiffs’ leases, landlord’s agent fraudulently withheld from plaintiffs the material fact of the execution of the lease between landlord and the trust company containing demolition provisions, and in reliance thereon plaintiffs were lulled into security to their detriment, the landlord is estopped to assert in any way any benefits or rights under the lease between landlord and the trust company which were fraudulently withheld from plaintiffs. (Phillips v. West Rockaway Land Co., 226 N. Y. 507; Hofmann v. Hofmann, 172 Misc. 378; Adams v. Gillig, 199 N. Y. 314; Bridger v. Goldsmith, 143 N. Y. 424; LaShelle Co. v. Armstrong Co., 263 N. Y. 79.)

      Vincent Keane, Anthony J. Busicco, Edward E. Blakeslee and Louis W. Dawson for the Mutual Life Insurance Company of New York, defendant, respondent and appellant.
    I. The law as it now exists requires reversal, whether or not the Appellate Division’s determination was correct when made. (Quaker Oats Co. v. City of New York, 295 N. Y. 527; Kemp v. Rubin, 298 N. Y. 590; Matter of Kahn [Nat. City Bank], 284 N. Y. 515; Matter of Tartaglia v. McLaughlin, 297 N. Y. 419; Pfister v. Coopersmith, 298 N. Y. 500; Robinson v. Robins Dry Dock & Repair Co., 238 N. Y. 271; People ex rel. Clark v. Gilchrist, 243 N. Y. 173; Bradford v. County of Suffolk, 283 N. Y. 503; Lane v. Johnson, 283 N. Y. 244; Harnett & Co. v. Englander, 120 App. Div. 351.) II. Whether tested now or as of the date of reversal, the Appellate Division’s determination was erroneous. All requirements for an eviction under subdivision (c) of section 8 of the Business Bent Law have been met. (Dubois & Sons v. Goldsmith Bros., 273 App. Div. 306; Stern v. Equitable Trust Co., 238 N. Y. 267; Harris v. Bedell Co., 222 App. Div. 467, 248 N. Y. 611; Hudson & Manhattan R. R. Co. v. Mayers, 117 Misc. 183; Burnee Corp. v. Uneeda Pure Orange Drink Co., 132 Misc. 435; Woods v. Postal Tel. Cable Co., 205 Ala. 236.) III. The Appellate Division imposed a condition precedent upon the landlord which is neither practicable nor authorized by subdivision (c) of section 8. (Rosasco Creameries v. Cohen, 276 N. Y. 274.)
   Lewis, J.

This consolidated action arises from a landlord-tenant controversy involving the right to possession of premises located at 512 Fifth Avenue, New York City, which are owned by the appellant, Mutual Life Insurance Company (hereinafter referred to as Mutual).

In 1945, Mutual leased the premises to Manufacturers Trust Company under a contract which provided for demolition of the building presently located thereon. Upon receiving notice to vacate, fifty-five of the tenants in the building joined in an action against Mutual and Manufacturers Trust Company in which they sought to enjoin those defendants from instituting proceedings to remove them from the building. They also asked for a judgment declaring their legal rights against the defendants. While that action was pending, Mutual, as landlord, commenced separate summary proceedings in Municipal Court against all its tenants — including the fifty-five tenants who were plaintiffs in the action for a declaratory judgment. Thereafter, by order of the Supreme Court, the summary proceedings were removed from Municipal Court and consolidated with the action by the tenants for declaratory judgment.

After a trial without a jury Special Term rendered a decision awarding Mutual delivery of possession of the premises in suit. Upon appeal by the tenants-plaintiffs the Appellate Division reversed the judgment on the law and the facts (two Justices dissenting) and directed judgment in favor of the tenants to the extent of enjoining the landlord and Manufacturers Trust Company from dispossessing the tenants under subdivision (c) of section 8 of the Business Rent Control Law (L. 1945, ch. 314) “ during the emergency period prescribed in such Law or until commencement of construction of a new building * * * is sooner approved by the Civilian Production Administration * * * or until the requirement for Federal authorization of commencement of construction be sooner terminated ”. From the judgment entered upon the order of the Appellate Division cross appeals were taken to this court by the landlord and by all but two of the fifty-five tenants.

The building here involved is an eight-story structure with stores on the street level and offices on the floors above. Ownership of this property —• with an adjoining building known as 508 Fifth Avenue — was acquired by Mutual in 1941 as a result of the foreclosure of a first mortgage which it held on the property. Eight months after the acquisition of the property by Mutual, negotiations were commenced with Manufacturers Trust Company which contemplated demolition of the existing building and the leasing of the property to Manufacturers Trust Company for relocation of its Fifth Avenue branch bank. With the onset of World War II, negotiations were suspended until the end of hostilities was in sight. In 1944, a long-term lease was entered into between Mutual and Manufacturers Trust Company in which the date of commencement of the term was made to depend upon the cessation of hostilities and the lifting of certain war emergency restrictions relating to building. The lease between Mutual and Manufacturers Trust Company provided, among other things:, (1) That Mutual pay up to $1,000,000 for the cost of demolishing the existing building and erecting a new bank building; (2) that any excess in the cost of demolition and construction over $1,000,000 was to be paid by Manufacturers Trust Company; (3) that all plans, specifications and building contracts were subject to the approval of Mutual, and (4) that the new building will become Mutual’s property upon its completion and will be surrendered to it immediately upon termination of the lease.

In March, 1945, the Business Bent Control Law (L. 1945, ch. 314) was enacted and became applicable to the proposed building. On November 1,1945, Manufacturers Trust Company called upon Mutual to fix the date of commencement of the term of the lease and, in accord with that request, Mutual set February 1, 1946, as the beginning of the term. On January 10, 1946, a construction contract was entered into by Manufacturers Trust Company and George A. Fuller Company which provided that the builder was to receive $85,000 plus the cost of erecting the building. That contract, approved by Mutual, also states: 1‘ The Contractor understands that The Mutual Life Insurance Company of New York owns the premises, and that this agreement is subject to the provisions of the lease from said Insurance Company to Manufacturers, dated October 1, 1944.” Approval of the plan for construction of the bank was obtained from the Department of Housing and Buildings of the City of New York on January 30, 1946.

On November 28,1945 — after the date for commencement of the new lease had been set — Mutual, as landlord, gave notices to all its tenants except two that their leases would terminate as of January 31, 1946, and that they would then be required to vacate the premises. All tenants so notified were in possession under leases which provided for termination on sixty days ’ notice from the landlord. When the various tenants did not vacate the premises on February 1, 1946, dispossess proceedings were commenced which, as we have seen, are now consolidated with the present action for a declaratory judgment brought by the tenants.

The landlord claims that, on February 1,1946, when the leases of all the plaintiffs tenants involved had come to an end— either by expiration of term or by a sixty-day notice from the landlord according to provisions in the leases —the tenants became statutory tenants subject to the provisions of the Business Bent Control Law. Accordingly, the landlord sought possession of the property under section 8, subdivision (c), of that statute which provides in part that a tenant who continues to pay rent as provided by the act cannot be removed unless ‘ ‘ the landlord seeks in good faith to recover possession for the immediate purpose of demolishing the building or other rental area with the intention of constructing a new building, and the plans for such construction have been approved by the proper authorities, if such approval is required by law.”

By their complaint the plaintiffs tenants allege in substance: (1) That the landlord could not validly terminate the leases under the sixty-day notice of election to terminate, inasmuch as (a) it was not within the contemplation of the parties at the time of execution of the leases that the landlord would be permitted to terminate for any reason but its own use, and (b) the landlord is estopped to avail itself of any benefit under the leases which permits termination thereof since it was guilty of fraud in failing to reveal the execution of the lease between Mutual and Manufacturers Trust Company at the time it entered into leases with the plaintiffs tenants and because it was guilty of improper curtailment of services to the tenants. (2) Even if the landlord could validly terminate the leases under the sixty-day notice, the landlord cannot legally dispossess the tenants under the Business Bent Control Law inasmuch as section 8, subdivision (c), is applicable only to situations where demolition is being done by and for the owner and cannot be construed to include a situation where the demolishing is being done by and for the lessee.

The Trial Justice ruled against the tenants on each of the contentions mentioned above. However, during the trial of the action the Federal Civilian Production Administration promulgated an order designed to divert ‘ ‘ critical materials from deferrable or less essential construction ” (Veterans’ Emergency Housing Program, General Bestrictions on Construction and Bepairs, Part 4700; 11 Federal Begister 3190.) That order — known as Veterans’ Housing Program Order 1 — forbade construction of a building, such as the one here involved, without first obtaining authorization from the Civilian Production Administration. Although the order was not effective when the present litigation began, it was called to the attention of the Trial Justice who was asked to take judicial notice thereof. The , Trial Justice ruled that Veterans’ Housing Program Order 1 did not deprive Mutual of the right to a final order under section 8, subdivision (c), of the Business Rent Control Law.

The Appellate Division ruled that ‘1 we are required to apply the law as it exists at the time the appeal is submitted and decided ” (271 App. Div. 499, 504) and, accordingly, reversed on the law and the facts on the ground that since the landlord had not obtained authorization from the Civilian Production Administration, it was not entitled to regain possession under the Business Rent Control Law.

The cases make it clear that the above-mentioned decision by the Appellate. Division made a proper application of the rule of law which requires that ‘ rights and other legal relations are to be determined as of the time they are declared ” (Quaker Oats Co. v. City of New York, 295 N. Y. 527, 536; Matter of Boardwalk & Seashore Corp. v. Murdock, 286 N. Y. 494, 498; People ex rel. Clark v. Gilchrist, 243 N. Y. 173, 179-180; Robinson v. Robins Dry Dock & Repair Co., 238 N. Y. 271, 280-281). By a fortuitous circumstance, however, that same rule of law — which served as the sole basis for the Appellate Division’s reversal of the order made herein at Special Term — now becomes the sole basis for our reversal of the order made by the Appellate Division. That circumstance is that on June 30, 1947 — following the date (December 20, 1946) of the order of the Appellate Division upon which was entered the judgment we now review — the order of the Federal Civilian Production Administration which the Appellate Division ruled prohibited Mutual from regaining possession of its building, was revoked. (60 U. S. Stat. 207; U. S. Code, tit. 50, Appendix, § 1821; Housing and Rent Act of 1947; 61 U. S. Stat. 193; U. S. Code, tit. 50, Appendix, § 1881; 12 Federal Register 4265.) From such revocation it follows that since June 30, 1947, authorization by the Federal Civilian Production Administration which the Appellate Division ruled was a prerequisite to the recovery by Mutual of possession of the building here involved — has become unnecessary.

We do not agree with the tenants’ argument that since no permit is now required from the Civilian Production Administration or other Federal authority, the litigation between Mutual and the tenants presents only academic questions. Although an appeal will be dismissed as academic where “ nothing remains but the abstract question who was right ” (People ex rel. Geer v. Common Council of City of Troy, 82 N. Y. 575, 576), if any question remains, dismissal is not in order. (Matter of Gage, 141 N. Y 112, 114; Williams v. Montgomery, 148 N. Y. 519, 523, 525.) In our opinion, the removal of Federal restrictions on construction did not transform this action into one in which “ nothing remains but the abstract question who was right.” The action is one in which Mutual, a landlord, is seeking to regain possession of its property pursuant to subdivision (c) of section 8 of the Business Rent Control Law. The question involved is the right of tenants to withhold possession of the property from the owner. One of the issues has been the necessity for a Civilian Production Administration permit. Although concededly such a permit is not now necessary, the revocation of that administrative order did not automatically put the landlord in possession; nor does it mean- that the landlord no longer must comply with the provisions of section 8, subdivision (c). Accordingly, our conclusion is that there remain in the case other controversial issues which bear upon the question whether the landlord is entitled to regain possession of the property.

The tenants also argue that since the inception of this litigation the facts have changed to such an extent that a determination of the appeal on the facts presented to Special Term would be merely a decision of a moot question. The facts which have changed since the original trial are said to be as follows: On July 16, 1947 — after the revocation of the Federal order requiring a Civilian Production Administration permit — Manufacturers Trust Company informed Mutual that, in its opinion, your appeal to the Court of Appeals in the present litigation with your tenants is now academic ”. Thereafter, on October 6, 1948, Manufacturers Trust Company notified Mutual that it regarded the lease agreement abandoned by Mutual and demanded the return of the deposit made under that agreement. On November 22, 1948, Manufacturers Trust Company commenced suit against Mutual to recover the amount of that deposit. Therefore, claim the tenants, since there has been an abandonment of the lease, since no bank building is to be built, and since no plans for any other building have been approved, the appeal must be dismissed because the question of what Mutual’s rights would have been if its lease with Manufacturers were to be carried out has become abstract, academic and moot.” It is Mutual’s position, however, that Manufacturers Trust Company is wrong in claiming an abandonment of the lease. Contending that the Trust Company is still bound by its contract, it appears that Mutual intends to resist the action by which Manufacturers seeks to be released from its agreement.

The record thus makes it clear that the alleged change in facts upon which the tenants would have us dismiss the present case has not been the subject of a judicial determination of the rights of Manufacturers Trust Company and Mutual. Although this court, in a proper case, may take judicial notice of changes in applicable law occurring after the decisions below (see Graybar Elec. Co. v. New Amsterdam Gas. Co., 292 N. Y. 246, 250) evidence of new facts bearing upon the correctness of those decisions —■ even though pertinent to the inquiry — cannot be reviewed by this court in reaching its decision. (Matter of New York Cable Co. v. Mayor of City of New York, 104 N. Y. 1, 40; and see Rudiger v. Coleman, 228 N. Y. 225, 233.)

The judgments should be reversed, without costs, and a new trial granted.

Desmond, J.

(dissenting).

I dissent.

I think that the judgment below should be modified, without costs, by providing that the complaint in the consolidated action be dismissed, on the ground that the action has become moot. Three and one-half years ago, in November, 1945, Mutual Life Insurance Company, the building owner, notified its tenants that they were required to vacate not later than January 31, 1946, because the owner had rented the entire parcel of land to Manufacturers Trust Company, for a term beginning February 1, 1946, and because it (Mutual) desired to give possession to such lessee and because the building in which these tenants were located was “ to be demolished immediately after January 31, 1946 and is to be replaced by a new building.” The tenants refused to move, but brought suit for declaratory judgment; the landlord then brought eviction proceedings against all the tenants, and the action and proceedings were consolidated, and the consolidated cause, which we have before us oil this appeal, is still pending. In October, 1948, as appears without dispute from statements made to us in the briefs on this case and in oral argument, Manufacturers Trust Company, proposed tenant of the new building, notified Mutual Life Insurance Company, that, by reason of the long delays, Manufacturers Trust'Company considered that the agreement between the owner and Manufacturers Trust Company made in 1944, had been terminated; Manufacturers demanded the return of its $100,000 deposit and notified the owner that Manufacturers would claim damages. In November, 1948, Manufacturers brought suit against the owner for the return of its deposit and for damages, which suit is pending. The Business Rent Control Law of this State, forbidding the eviction of tenants during the emergency, makes an exception in a case where the landlord in good faith wants his property back to demolish the present building and erect a new one. "When this case was tried below and argued in the Appellate Division, it appeared that the landlord was, on the facts, entitled to possession under that exception. However, it is now evident that the proposed tenant for the new building is refusing to perform, and that the proposed new building is not going to be erected for a long time, if ever.' Under these circumstances, I think it would be wrong to order these tenants evicted on the basis of a state of facts which has changed so materially, and to compel their removal because of the proposed erection of a new building, construction of which seemed imminent several years ago, but the construction of'which is now at least doubtful.

At the very least, there should be a new trial of the facts as they now are, not as they were in 1946.

Loughban, Ch. J., Conway, Dye, Fuld and Bbomley, JJ., concur with Lewis, J.; Desmond, J., dissents in opinion.

Judgments reversed, etc.


author: Conway, J.

text:
    Harry S. Gorgas, Appellant-Respondent, v. Ida Perito, Respondent-Appellant, et al., Defendants.
    Argued February 23, 1949;
    decided May 26, 1949.

      Aaron I. Berk and Alfred J. Gonforti for plaintiff, appellant and respondent.
    I. Payments made in 1946 averted the effect of section 47-a of the Civil Practice Act. (Old Arms House v. Smith, 52 Conn. 434; Empire Trust Co. v. Heinze, 242 N. Y. 475; Brooklyn Bank v. Barnaby, 197 N. Y. 210; Murdock v. Waterman, 145 N. Y. 55; Mills v. Davis, 113 N. Y. 243; Clute v. Clute, 197 N. Y. 439.) II. The issues of fact as to agency were determined by the trial court whose findings were affirmed by the Appellate Division. (Queeney v. Willi, 225 N. Y. 374; Crow v. Gleason, 141 N. Y. 489.) III. Plaintiff is entitled to interest from December 21, 1933, less $550 paid on account. (Harper v. Fairley,, 53 N. Y. 442; Matter of Bond & Mtge. Guar. Co. [570 Kosciusko St.], 272 App. Div. 944, 297 N. Y. 765.)

      Garry J. Fury for defendant, respondent and appellant.
    I. The complaint should have been dismissed by the trial court on the ground that the action was barred by section 47-a of the Civil Practice Act. (Cary v. Koerner, 200 N. Y. 253; Levy v. Jones, 269 App. Div. 295; Kirschner v. Cohn, 270 App. Div. 126; Butler v. Price, 271 App. Div. 359; Matter of Bond & Mtge. Guar. Co. [570 Kosciusko St.], 272 App. Div. 944, 297 N. Y. 765; Egan v. Carroll-Garfield Corp., 185 Misc. 530, 269 App. Div. 998; Bolfe v. Walker, 188 Misc. 367; Rookery Investing Co. v. Audley

      Constr. Corp., 188 Misc. 693; Matter of Muller, 192 Misc. 514; Gregoire v. Putnam’s Sons, 298 N. Y. 119; Schmidt v. Merchants Desp. Transp. Co., 270 N. Y. 287.) II. Defendant-appellant never became personally obligated to pay the mortgage debt and, hence, the rule of part payment cannot apply to revive the debt outlawed by the Statute of Limitations. (Harper v. Fairley, 53 N. Y. 442; Smith v. Ryan, 66 N. Y. 352; Adams v. Olin, 140 N. Y. 150; Crow v. Gleason, 141 N. Y. 489; Murdock v. Waterman, 145 N. Y. 55; Mack v. Anderson, 165 N. Y. 529;. Brooklyn Bank v. Barnaby, 197 N. Y. 210; Empire Trust Co. v. Heinze, 242 N. Y. 475; Brooklyn Sav. Bank v. Wechsler Estate, 259 N. Y. 9; Peoples Trust Co. v. O’Neil, 273 N. Y. 312; Scott v. Palmer, 246 App. Div. 379, 273 N. Y. 471; Nickell v. Tracy, 100 App. Div. 80.) III. The part payment rule cannot be applied to restore accrued and outlawed interest on the original debt. (Quackenbush v. Mapes, 123 App. Div. 242; Jackson Heights Apt. Corp. v. Staats, 272 App. Div. 780; Harper v. Fairley, 53 N. Y. 442.) IV. The evidence was not sufficient as a matter of law to sustain the trial court’s finding that the part payments were made by defendant-appellant through her agent and in recognition of the mortgage debt. (Crow v. Gleason, 141 N. Y. 489; Matteson v. Falser, 56 App. Div. 91; Littlefield v. Littlefield, 91 N. Y. 203; Matter of Fitch, 270 App. Div. 227.)
   Conway, J.

This action was commenced in 1947, to foreclose a mortgage, held by the plaintiff-assignee, on certain premises in New York City, owned by defendant Ida Perito. The mortgage, originally in the amount of $7,500, was executed and delivered in 1914, by defendant Ida Perito and her husband, Angelo Perito, as collateral security for a bond in the same amount, executed and delivered by Angelo Perito alone. The bond and mortgage provided in part that the whole of the principal sum should become due at the option of the obligee-mortgagee after default in the payment of interest for thirty days.

Angelo Perito, the obligor on the bond, died intestate in 1936, leaving him surviving his widow, Ida, and five children. By a quitclaim deed recorded in 1941, Ida Perito became the sole owner of the mortgaged premises. She never expressly assumed the payment of the debt secured by the mortgage, and no deficiency judgment is sought against her.

A payment of $2,500 was made on principal in 1925, and regular, semiannual installments of interest were paid up to and including December 21, 1933. The next installment of interest became due and payable on June 21, 1934, and installments of interest in like amounts became due and payable on the 21st days of December and June, semiannually thereafter, but no part of said installments has been paid except that eight payments on account were made in 1937, one in 1938 and two in 1946. Each of said payments on account was in the amount of $50 and each was made — as the trial court properly found upon sufficient evidence— by defendant, Ida Perito, through her son, John A. Perito, as agent.

Defendant set up the Statute of Limitations as a bar, alleging that the cause of action for foreclosure did not accrue within six years next preceding the commencement of the action. (Civ. Prac. Act, § 47-a.) The trial court rejected that defense, apparently on the theory that the partial payments made on the mortgage debt constituted an acknowledgment of the existence of the lien of the mortgage and extended'the time within which plaintiff could sue in foreclosure. Accordingly, the trial court found that there was justly due and owing to plaintiff on the bond and mortgage, the principal sum of $5,000 with interest thereon at the rate of five per cent per annum from December 21st, 1933, less the sum of $550 paid in the installments as above set forth.”

On appeal, the Appellate Division affirmed the findings of fact below, but modified the judgment on the law by providing for the payment of interest on the mortgage from February 28, 1941 ”. As so modified, the judgment of foreclosure was affirmed.

Both the plaintiff-mortgagee and the defendant-owner appeal to this court from the judgment entered upon the order of modification and affirmance. Defendant’s main contention is that the partial payments did not extend the time for commencement of the action for foreclosure, since they were not made by the obligor on the bond, i.e., the person liable for the payment of the debt secured by the mortgage. We think the argument is without merit. The action here is to foreclose upon and sell the interest of the owner of the equity of redemption in order to satisfy the balance of the debt, which includes accrued interest, secured by the mortgage. No deficiency judgment is sought. In that sitúation, it seems clear, on principle and precedent, that partial payments on the mortgage debt, made by the owner of the equity of redemption, or his authorized agent, is an acknowledgment of the existence of the lien of the mortgage upon the property and extends the time within which the mortgagee may commence his action for foreclosure and sale. (See Empire Trust Co. v. Heinze, 242 N. Y. 475, 480; Clute v. Clute, 197 N. Y. 439; Murdock v. Waterman, 145 N. Y. 55, 61, 65, 69.) We, therefore, agree with the courts below that the action for foreclosure is not barred by the Statute of Limitations.

The Appellate Division, however, modified the judgment of foreclosure by directing that unpaid interest on the debt secured by the mortgage be allowed only from February 28, 1941, six years prior to the date of the summons, instead of from December-21, 1933, the date of the last regular payment of interest, as held by the trial court. Thus, the holding appears to be that while the action for foreclosure and sale is timely, and while plaintiff may recover the full amount of unpaid principal, he nevertheless may recover only those installments of interest which became due within six years of the commencement of the action. We see no reason for th&t distinction here between principal and interest and for thus limiting plaintiff’s recovery. If, as we agree, the partial payments by the defendant-owner, through her son, as agent, operated as an acknowledgment of the lien of the mortgage so that the action for foreclosure is timely, plaintiff should be permitted to recover, out of the proceeds of the sale of the premises, the full amount due him, viz., both the unpaid principal and the unpaid interest installments. The amount due upon the bond, for which the mortgage stands as security, is an entirety consisting of principal and interest. (Beal Property Law, § 254, subd. 3.)- The partial payments constitute an acknowledgment of the lien -of the mortgage, i.e., for all the amount unpaid as principal and interest.

Cases such as Chapin v. Posner (299 N. Y. 31, 42); Matter of Bond & Mtge. Guar. Co. (570 Kosciusko St.) (272 App. Div. 944, affd. 297 N. Y. 765), Ernst v. Schaach (271 App. Div. 1012, affd. 297 N. Y. 566), and Kirschner v. Cohn (270 App. Div. 126), have no bearing upon the situation here presented. They were cases in which the Statute of Limitations had run against the cause of action both as to principal and interest on a certain date, but recovery was allowed for those installments of interest which became due prior to that date and yet within six years of the commencement of the action. The result was reached upon the theory, evolved in response to the special circumstances created by the mortgage moratorium, that successive defaults in payment of interest installments gave rise to separate new causes of action. (White v. Wielandt, 259 App. Div. 676, decision amended 260 App. Div. 871, affd. 286 N. Y. 609.) Hence, even though recovery of both principal and interest were held barred by the Statute of Limitations on a certain date, the courts, during the mortgage moratorium, permitted recovery of those installments of interest which had become due prior to that date and within six years of the commencement of the action. In the case at bar, however, the normal period of limitation has been extended by the partial payments above mentioned, the action for foreclosure is timely, and recovery is not barred as to any part of the unpaid principal and interest. In that situation, the cited cases are inapposite.

The judgment of the Appellate Division should be reversed and the judgment of the Special Term affirmed, with costs to plaintiff in this court and in the Appellate Division.

Loughran, Ch. J., Lewis, Desmond, Dye, Fuld and Bromley, JJ., concur.

Judgment reversed, etc.


author: Fuld, J.

text:
    The People of the State of New York, Respondent, v. Meyer Greenwald, Appellant. The People of the State of New York, Respondent, v. Marvin Fleet, Appellant. The People of the State of New York, Respondent, v. Stephen J. Strauss, Appellant. The People of the State of New York, Respondent, v. Jacob Schaffer, Appellant. The People of the State of New York, Respondent, v. David Kaskell, Appellant. The People of the State of New York, Respondent, v. John Hill, Appellant. The People of the State of New York, Respondent, v. Gladys Siegel, Appellant.
    Argued April 19, 1949;
    decided June 2, 1949.

      Louis E. Yavner for Meyer Greenwald, appellant.
    I. By failing to adduce any evidence of the amount of “ lawful charges ’ ’ for the professional offices involved, or of any express “ addition to lawful charges,” the People failed to prove an essential element of the offense proscribed in section 965 of the Penal Law, and thus failed to prove commission of a crime. Defendant’s conviction was erroneous. (2 Bishop’s New Criminal Procedure, § 1049; People v. Montlake, 184 App. Div. 578; Howard v. Moot, 64 N. Y. 262; Vadney v. United Traction Co., 193 App. Div. 329; Hunter v. New York, Ontario & Western R. R. Co., 116 N. Y. 615; Flo-Ru-Na, Inc., v. Zimmerman, 185 Misc. 759; Spencer v. Kupersmit, 187 Misc. 362; People v. Brill, 255 App. Div. 452; People v. Lofaro, 256 App. Div. 1001; People v. Goodstein, 297 N. Y. 451.) II. The conviction of defendant was based solely upon the uncorroborated testimony of witnesses who were accomplices in the commission of the alleged crimes, and was therefore erroneous. (People v. Hayes, 210 App. Div. 549; People v. Clougher, 246 N. Y. 106; People v. Boyle, 107 Misc. 268; People v. Bissert, 71 App. Div. 118; People v. Hyde, 156 App. Div. 618; People v. Hooghkerk, 96 N. Y. 149; People v. Kress, 284 N. Y. 452; People v. Reddy, 261 N. Y. 479.) III. Section 965 of the Penal Law violates the “ due process ” clauses of both the Federal and State Constitutions in that its provisions fail to define the conduct labeled criminal with clarity, definity and certainty. (People v. Grogan, 260 N. Y. 138; People v. O’Gorman, 274 N. Y. 284; United States v. Cohen Grocery Co., 255 U. S. 81.) IV. Section 965 is unconstitutional in that it violates the prohibition against incorporation by reference contained in section 16 of article III of the State Constitution. (Barweger v. Staats, 267 N. Y. 290.) V. Section 965 is unconstitutional in that it violates the prohibition against delegation of legislative power contained in section 1 of article III of the State Constitution. (Panama Refining Co. v. Ryan, 293 U. S. 388; Schechter Poultry Corp. v. United States, 295 U. S. 495; Darweger v. Staats, 267 N. Y. 290.) VI. Section 965 is unconstitutional in that it violates the injunction against impairment of the obligation of contracts contained in section 10 of article I of the Federal Constitution; and constitutes an unlawful interference with the right to contract, in violation of the Fourteenth Amendment. (Trustees of Dartmouth College v. Woodward, 4 Wheat. [U. S.] 518; People v. Nebbia, 262 N. Y. 259.) VII. Counts 1, 2,4, 6, 8,10 and 11 of the information should have been dismissed since the People did not submit evidence as to these counts that a crime had been committed in New York County. The trial court had no jurisdiction to try these counts in New York County. (People v. Werblow, 241 N. Y. 55; People v. Fein, 292 N. Y. 10.)

      I. Maurice Wormser and Bernard I. Strauss for Marvin Fleet and Stephen J. Strauss, appellants.
    I. Section 965 of the Penal Law is too vague, indefinite and uncertain to satisfy the Federal and State constitutional requirements of “ due process of law.” (People v. O’Gorman, 274 N. Y. 284; People v. Grogan, 260 N. Y. 138; Campbell v. City of New York, 244 N. Y. 317; United States v. Cohen Grocery Co., 255 U. S. 81; Standard Chemicals & Metals Corp. v. Waugh Chemical Corp., 231 N. Y. 51.) II. Section 965 of the Penal Law violates section 16 of article III of the State Constitution, prohibiting incorporation by reference. (Darweger v. Staats, 267 N. Y. 290.) III. Section 965 of the Penal Law involves an unlawful delegation of legislative powers, in violation of section 1 of article III of the State Constitution. (Darweger v. Staats, 267 N. Y. 290; Packer Collegiate Inst. v. University of State of N. Y., 298 N. Y. 184; People v. Mailman, 293 N. Y. 887.) IV. Section 965 of the Penal Law contravenes section 10 of article I of the Federal Constitution in that it impairs the obligations of contracts, and the Fourteenth Amendment of the Federal Constitution in that it constitutes an unlawful interference with the natural and constitutional right to contract. It cannot be justified under the so-called “ Police Power ” of this State. (People v. Nebbia, 262 N. Y. 259; Grosjean v. American Press Co., 297 U. S. 233; Meyer v. State of Nebraska, 262 U. S. 390; Home Bldg. & Loan Assn. v. Blaisdell, 290 U. S. 398; East New York Sav. Bank v. Hahn, 326 U. S. 230.) V. Section 965 of the Penal Law directly and illegally conflicts with the controlling Federal Housing and Kent Acts of 1947 and 1948. (Woods v. Miller Co., 333 U. S. 138; Chicago, Rock Island & Pacific Ry. Co. v. Hardwick Farmers Elevator Co., 226 U. S. 426; Charleston & Western Carolina Ry. Co. v. Varnville Furniture Co., 237 U. S. 597.) VI. The People failed to prove that the charges made by defendant were unlawful; since defendant was a licensed real estate broker, he could charge whatever sum he wished, big or little. VII. The People failed to prove that the payment of money would procure for complainants advantages over others in entering into agreements for the leasing of real property. VIII. As the conviction is based upon the uncorroborated evidence of admitted accomplices, it must be reversed. (People v. Nitzberg, 287 N. Y. 183, 289 N. Y. 523.) IX. The People failed to prove the corpus delicti.

      George J. Elkins for Jacob Schaffer, appellant.
    I. Section 965 of the Penal Law, in failing to provide guides, standards or criteria as to “ lawful charges ”, is unconstitutional, since the provisions thereof are too vague, indefinite and uncertain to meet the requirements of due process of law. (People v. Grogan, 260 N. Y. 138; People v. O’Gorman, 274 N. Y. 284; Standard Chemicals & Metals Corp. v. Waugh Chemical Corp., 231 N. Y. 51.) II. Since section 965 is to be read in conjunction with other State or Federal legislation, and the alleged crime defined and interpreted by reference thereto, the law is unconstitutional as violative of the provisions of section 16 of article III of the State Constitution. (Darweger v. Staats, 267 N. Y. 290.) III. Section 965 of the Penal Law is invalid because it violates the constitutional requirement prohibiting a delegation of legislative powers. (Panama Refining Co. v. Ryan, 293 U. S. 388; Schechter Poultry Corp. v. United States, 295 U. S. 495; United States v. Rock Royal Co-operative, 307 U. S. 533; Opp Cotton Mills v. Administrator, 312 U. S. 126; Darweger v. Staats, 267 N. Y. 290.) IV. Section 965 of the Penal Law violates section 10 of article I, as well as the Fourteenth Amendment of the Federal Constitution, as to freedom of contract and deprivation of property. V. The conviction of defendant was erroneous since it was based upon the uncorroborated testimony of witnesses who were his accomplices in the commission of the alleged crime. VI. The first count of the information should have been dismissed since the People did not adduce evidence of the commission of any crime in New York County. (People v. Fowler, 152 N. Y. S. 672.)

      I. Maurice Wormser, Hyman Bar shay and Samuel Bader for David Kaskell, appellant.
    I. Section 965 of the Penal Law, under which defendant was convicted, is vague, indefinite and uncertain, and fails to provide an ascertainable standard for determining guilt. Therefore it fails to comply with the “ due process ” clauses of the Fourteenth Amendment to the .United States Constitution and of section 6 of article I of the State Constitution. (Campbell v. City of New York, 244 N. Y. 317;
      Connally v. General Constr. Co., 269 U. S. 385; United States v. Cohen Grocery Co., 255 U. S. 81; United States v. Capital Traction Co., 34 App. D. C. 592; Lansetta v. New Jersey, 306 U. S. 451; Cline v. Frink Dairy Co., 274 U. S. 445; People v. O’Gorman, 274 N. Y. 284; People v. Mancuso, 255 N. Y. 463.) II. Section 965 of the Penal Law violates both section 16 of article III of the State Constitution, which prohibits incorporation by reference, and section 1 of article III of the State Constitution, in that it involves an unlawful delegation of legislative powers. (Darweger v. Staats, 267 N. Y. 290; People v. Mailman, 293 N. Y. 887.) III. Congress has evinced a clear intent that no criminal penalties should attach to violations of the Federal Housing and Bent Acts of 1947 and 1948. Section 965 of the Penal Law is therefore unconstitutional and invalid. (Woods v. Miller Co., 333 U. S. 138; Fleming v. Mohawk Wrecking & Lumber Co., 331 U. S. 111; Bethlehem Steel Co. v. New York State Labor Relations Bd., 330 U. S. 767; Chicago, Rock Island & Pacific Ry. Co. v. Hardwick Farmers Elevator Co., 226 U. S. 426; Charleston & Western Carolina Ry. Co. v. Varnville Furniture Co., 237 U. S. 597; Gibbons v. Ogden, 9 Wheat. [U. S.] 1.) IV. Section 965 of the Penal Law contravenes section 10 of article I of the Federal Constitution in that it impairs the obligations of contracts, and the Fourteenth Amendment of the Federal Constitution, in that it constitutes an unlawful interference with the right to contract. (Trustees of Dartmouth College v. Woodward, 4 Wheat. [U. S.] 518; People v. Nebbia, 262 N. Y. 259; Grosjean v. American Press Co., 297 U. S. 233; Meyer v. State of Nebraska, 262 U. S. 390; Home Bldg. & Loan Assn. v. Blaisdell, 290 U. S. 398; East New York Sav. Bank v. Hahn, 326 U. S. 230.)

      Louis E. Yavner for John Hill, appellant. I. By failing to adduce any evidence of the amount of “ lawful charges ” for the professional office involved, or of any express “ addition to lawful charges,” the People failed to prove an essential element of the offense proscribed in section 965 of the Penal Law, and thus failed to prove commission of a crime. Defendant’s conviction was erroneous. (2 Bishop’s New Criminal Procedure, § 1049; People v. Montlake, 184 App. Div. 578; Howard v. Moot, 64 N. Y. 262; Vadney v. United Traction Co., 193 App. Div. 329;
      Hunter v. New York, Ontario & Western R. R. Co., 116 N. Y. 615; Flo-Ru-Na, Inc., v. Zimmerman, 185 Misc. 759; People v. Brill, 255 App. Div. 452; People v. Lofaro, 256 App. Div. 1001; People v. Goodstein, 297 N. Y. 451.) II. The conviction was based solely upon the uncorroborated testimony of witnesses who were accomplices in the commission of the alleged crime, and was therefore erroneous. (People v. Hayes, 210 App. Div. 549; People v. Clougher, 246 N. Y. 106; People v. Mullens, 292 N. Y. 408; People v. Bissert, 71 App. Div. 118; People v. Hyde, 156 App. Div. 618; People v. Hooghkerk, 96 N. Y. 149; People v. Kress, 284 N. Y. 452.) III. Section 965 of the Penal Law violates the “ due process ” clauses of both the Federal and State Constitutions in that its provisions fail to define the conduct labeled criminal with clarity, definity and certainty. (People v. Grogan, 260 N. Y. 138; People v. O’Gorman, 274 N. Y. 284; United States v. Cohen Grocery Co., 255 U. S. 81.) IV. Section 965 is unconstitutional in that it violates the prohibition against incorporation by reference contained in section 16 of article III of the State Constitution. (Darweger v. Staats, 267 N. Y. 290.) V. Section 965 is unconstitutional in that it violates the prohibition against delegation of legislative power contained in section 1 of article III of the State Constitution. (Panama Refining Co. v. Ryan, 293 U. S. 388; Schechter Poultry Corp. v. United States, 295 U. S. 495; Darweger v. Staats, 267 N. Y. 290.) VI. Section 965 is unconstitutional in that it violates the injunction against impairment of the obligation of contracts contained in section 10 of article I of the Federal Constitution, and constitutes an unlawful interference with the right to contract, in violation of the Fourteenth Amendment. (Trustees of Dartmouth College v. Woodward, 4 Wheat. [U. S.] 518; People v. Nebbia, 262 N. Y. 259.) VII. The information should have been dismissed since the People did not submit evidence that a crime had been committed in New York County. The trial court had no jurisdiction to try the charge in New York County. (People v. Werblow, 241 N. Y. 55; People v. Fein, 292 N. Y. 10.)

      Victor W. Mills for Gladys Siegel, appellant.
    I. Section 965 of the Penal Law, upon which the information is based and defendant sentenced, is vague, indefinite and uncertain and fails to set an ascertainable standard of judgment of conduct, and hence is unconstitutional as a violation of the Fourteenth Amendment to the United States Constitution and section 6 of article I of the State Constitution. (Campbell v. City of New York, 244 N. Y. 317; People v. Shakun, 251 N. Y. 107; Connally v. General Constr. Co., 269 U. S. 385; United, States v. Cohen Grocery Co., 255 U. S. 81; United States v. Capital Traction Co., 34 App. D. C. 582; People v. O’Gorman, 274 N. Y. 284; People v. Grogan, 260 N. Y. 138.) II. Section 965 of the Penal Law is unconstitutional in that it is a clear violation of section 1 of article III of the State Constitution prohibiting the delegation of legislative powers. (Darweger v. Staats; 267 N. Y. 290; Packer Collegiate Inst. v. University of State of N. Y., 298 N. Y. 184.) III. Section 965 of the Penal Law violates section 16 of article III of the State Constitution, which prohibits incorporation by reference. (Darweger v. Staats, 267 N. Y. 290.) IV. Section 965 of the Penal Law is invalid as being in direct conflict with the express intent of the Federal Housing and Bent Acts of 1947 and 1948. (Charleston & Western Carolina Ry. Co. v. Varnville Furniture Co., 237 U. S. 597; Southern Ry. Co. v. Railroad Comm. of Ind., 236 U. S. 439; International Shoe Co. v. Pinkus, 278 U. S. 261.)

      Frank S. Hogan, District Attorney (Whitman Knapp, Harold Roland Shapiro, Peyton H. Moss and Edgar J. Nathan, 3d, of counsel), for respondent.
    I. The statute is a valid exercise of State power. (People v. Harkavy, 192 Misc. 580; People v. Cooper, 268 App. Div. 966, 294 N. Y. 797; People v. Weller, 237 N. Y. 316, Weller v. New York, 268 U. S. 319; Kay v. United States, 303 U. S. 1; Matter of Tartaglia v. McLaughlin, 297 N. Y. 419; Friedman v. New York Central R. R. Co., 206 App. Div. 169; St. Luke’s Hosp. v. Godet, 171 Misc. 7; Samuels v. Quartin, 108 F. 2d 789; Surace v. Danna, 248 N. Y. 18; People ex rel. Durham Realty Corp. v. La Fetra, 230 N. Y. 429, 257 U. S. 665; Veix v. Sixth Ward Bldg. & Loan Assn., 310 U. S. 32.) II. The testimony of the payor-witnesses does not' require corroboration. (People v. Harkavy, 192 Misc. 580; People v. Beggs, 178 Cal. 79; Hornstein v. Paramount Pictures, 292 N. Y. 468; People v. Blank, 283 N. Y. 526.) III. Venue was, in all cases, properly laid in New York County. (Code Crim. Pro., § 134; People v. Hudson

      Valley Constr. Co., 217 N. Y. 172; People v. Griffin, 2 Barb. 427; People v. Vario, 165 Misc. 842; People v. Levy, 123 Misc. 845; People v. Licensiata, 199 App. Div. 106.)
   Fuld, J.

Taking advantage of New York City’s acute postwar housing shortage, each of these defendants exacted from apartment seekers automobiles or large cash payments, amounting in some instances to thousands of dollars, on the strength of representations that such contributions would facilitate and influence the securing of accommodations. Convicted of violating section 965 of the Penal Law, entitled Excessive charges in connection with rental agreements ’ ’, defendants challenge their convictions upon constitutional grounds.

Section 965 makes it a misdemeanor for anyone either (1) to request, collect or accept from another ‘ * any donation, gratuity, bonus, emolument, gift, payment or thing of value, in addition to lawful charges,” upon the representation or understanding that ‘ ‘ compliance * * * will facilitate, influence or procure an advantage over others in entering into an agreement ” for rental of real property or (2) to refuse to enter into any such agreement “ unless he receives * * * any such donation, gratuity, bonus * * * gift, payment or thing of value ”.

The provision is — contrary to defendants’ contention — not a rent control statute and does not purport, singly or in conjunction with other statutes or regulations, to prescribe or limit the amount of rent that may be charged. That is the province of other legislation, federal, state and local. (See, e.g., Emergency Commercial Bent Control Law, L. 1945, ch. 3; McKinney’s Unconsol. Laws, § 8521 et seq.; Emergency Business Bent Control Law, L. 1945, ch. 314; McKinney’s Unconsol. Laws, § 8551 et seq.; Federal Housing and Bent Control Acts of 1947, 1948, 1949, U. S. Code, tit. 50, Appendix, § 1881 et seq.; N. Y. C. Adm. Code, § U41-4.0, subd. d.) And, since that is so, it completely disposes of the claims that there was either an incorporation of any other laws by reference (N. Y. Const., art. Ill, § 16) or an unlawful delegation of legislative powers (N. Y. Const., art. II, § 1).

Nor is there basis for defendants’ further plaint that the statute is vague and uncertain and lacks an ascertainable standard. In our view, section 965 meets the constitutional tests by giving reasonable notice of 1 ‘ what must be done and what must be avoided ” and of how the charge may be defended. (See People v. Grogan, 260 N. Y. 138, 145; see, also, People v. Mancuso, 255 N. Y. 463, 469; Gorin v. United States, 312 U. S. 19, 26; Cline v. Frink Dairy Co., 274 U. S. 445, 459-460; Connolly v. General Constr. Co., 269 U. S. 385, 391-392; United States v. Cohen Grocery Co., 255 U. S. 81, 92; International Harvester Co. v. Kentucky, 234 U. S. 216, 223.)

Designed to prevent the exploitation of those in desperate need of rental accommodations, the statute prohibits and condemns the acceptance of donations, gratuities, bonuses or gifts in connection with arranging leases. The phrase, “ in addition to lawful charges,” defines no essential element of the crime, simply serving to limit the immediately preceding words payment or thing of value, ’ ’ and to assimilate their meaning to that of the operative and controlling words — donation, gratuity, bonus or gift. In short, no extra premiums are tolerated, however ingeniously cloaked or disguised as payments; the fees collected must represent the charges for actual services.

In that respect, several defendants, being licensed real estate brokers or salesmen, make the separate contention that, since there is no limit to the amount of brokerage commissions which they may lawfully charge, they are immune from prosecution under section 965. We find their argument unpersuasive. The Real Property Law, in permitting a broker to collect commissions for legitimate services (Real Property Law, §§ 442-d, 440 et seq.), gives him no general license to exact tribute from a prospective tenant on the strength of a representation that such a payment will yield to the latter an advantage over others in securing a lease. The question presented upon the trial of a broker defendant is not different in any essential from that involved in the case of an unlicensed person. In each, the issue is, was the payment in fact exacted as a special premium of the type condemned, or was it received in payment of some legitimate service? As to two of the defendants here involved that question was answered in the affirmative by reason of their formal admissions — in one instance, by a plea of guilty, in the other, by a refusal to plead following disallowance of a demurrer (Code Crim. Pro., § 330). As to the remaining defendants, the affirmative answer implicit in the trial court’s finding of guilt is supported by overwhelming proof.

While the fact issue raised may in the abstract seem difficult, it is of a type with which the criminal courts are entirely familiar, of a sort with which they are constantly called upon to deal. A similar issue is met in the prosecution of a labor racketeer for extortion, when the defendant concedes receipt of the alleged extortionate payment but claims that it wa§ accepted in return for some legitimate service to labor or management. (Cf., e.g., People v. Parkinson, 297 N. Y. 749; People v. Fay, 296 N. Y. 510.) In the present prosecutions, the People more than met the burden of establishing, beyond a reasonable doubt, that the defendants, licensed or not, exacted large sums, not in return for legitimate services, but in manifest violation of the statute.

Defendants’ remaining points we consider to be lacking in merit.

In each case, the judgment should be affirmed.

Loughran, Oh. J., Lewis, Conway, Desmond, Dye and Bromley, JJ., concur.

Judgments affirmed.


author: Dye, J.

text:
    The People of the State of New York ex rel. Manhattan Storage & Warehouse Company, Respondent, against Joseph Lilly et al., Constituting the Tax Commission of the City of New York, Appellants.
    Argued March 3, 1949;
    decided June 2, 1949.

      John P. McGrath, Corporation Counsel (John F. Kelly and Seymour B. Quel of counsel), for appellants.
    Relator’s time to appeal from the final order commenced to run on July 16, 1947, the date upon which the order submitted by relator’s attorney was entered in the County Clerk’s office. Accordingly, relator’s notice of appeal served on August 18,1947, was not served within the thirty-day period prescribed by section 612 of the Civil Practice Act, and was properly rejected. (Naftal v. Jarvis, 208 App. Div. 75; Corporation of Scholes v. Fiche Warehouses, 204 App. Div. 329; People ex rel. New Yorh Towers v. Chambers, 191 Misc. 638; People ex rel. Textile Realty Corp. v. Chambers, 191 Misc. 288.)

      Alfred W. Bergren for respondent.
    I. Delator’s notice of appeal was timely. (Naftal v. Jarvis, 203 App. Div. 75; Corporation of Scholes v. Ficke Warehouses, 204 App. Div. 329; Moore & Co. v. Heymann, 207 App. Div. 416; Novich v. Armour & Co., 230 App. Div. 712; People ex rel. New York Towers v. Chambers, 191 Misc. 638; People ex rel. Trustees of Columbia Univ. v. Mills, N. Y. L. J., Feb. 24, 1948, p. 678, col. 1; People ex rel. Textile Realty Corp. v. Chambers, 191 Misc. 288.) II. Statutes giving and regulating the right of appeal should be liberally construed in furtherance of the right of appeal. (Corporation of Scholes v. Ficke Warehouses, 204 App. Div. 329; Pearson v. Lovejoy, 53 Barb. 407; Matter of Hurley Mercantile Co., 56 F. 2d 1023, 286 U. S. 555; Stid v. Missouri Pacific Ry. Co., 211 Mo. 411; Tooker v. Missouri Power & L. Co., 336 Mo. 592; Purnell v. Ocean City, 162 Md. 169; Bozeman v. Naff, 155 Tenn. 121; State v. Nangle, 82 W. Va. 224; Gaskins v. Mack, 91 Fla. 284; H. O. L. C. v. Pafara, 235 Wis. 184.) III. Delator was entitled to actual notice. (Matter of New York Central & Hudson Riv. R. R. Co., 60 N. Y. 112; Pearson v. Lovejoy, 53 Barb. 407.) IV. The 1946 amendment to section 1557-a of the Civil Practice Act did not operate to limit section 612 of the Civil Practice Act.
   Dye, J.

This appeal is by permission upon the following certified question: “ Should the defendants be compelled to accept the relator’s notice of appeal from the final order entered herein in the office of the Clerk of the County of New York on the 16th day of July 1947? ”

The problem arises out of the following circumstances: In this consolidated tax certiorari proceeding brought by the relator, a small reduction in assessment was directed. The relator’s attorneys in due course submitted a proposed final order with notice of settlement to the clerk of the Special Term for signature. The signature was affixed July 16, 1947, but in so doing the Justice struck out the provision for the allowance of costs as unwarranted by the small reduction in assessment. The order was then ‘1 automatically ’ ’ sent to the New York County Clerk’s office for entry and filing without further action by the attorneys, in keeping with the practice followed since the enactment of section 1557-a of the Civil Practice Act (L. 1947, ch. 592). A notation of the signing of such order was carried in the New York Law Journal dated July 17, 1947 (p. 101, col. 5). The"managing clerk in the office of the relator’s attorney thereupon that same day (July 17th) went to the office of the Clerk of the County of New York, procured the file from the clerk and conformed his copies of the order with the original entered July 16th. No fee was paid at the time of the automatic entry as the required fee had previously been paid in conformity with the new procedure (Civ. Prac. Act, § 1557-a). Thereafter, on August 18, 1947, the relator’s attorney served a notice of appeal from such final order which, on August 19, 1947, the corporation counsel rejected and returned with a notation that it was not served within thirty days as prescribed by section 612 of the Civil Practice Act (as amd. by L. 1921, ch. 372). For convenience, the pertinent language is quoted: ‘ ‘ except that the party entering the judgment or order, or serving the notice of the entry thereof, shall not be entitled to further notice to limit his time to appeal.”

The issue thus presented is whether the automatic entry in accordance with established practice (§ 1557-a), limits the exception of section 612, or in other words, whether such automatic entry amounts to the same thing as the act of the party or his attorney in personally presenting to the county clerk’s office the paper sought to be appealed from in order to start the time running in which to file notice of appeal.

The words “ the party entering the judgment or order ” as used in the statutory exception, have been construed to mean that the time limitation starts to run when the party himself or his attorney has actually entered in the County Clerk’s office the paper appealed from (Moore & Co. v. Heymann, 207 App. Div. 416), and that the exception was enacted to end the seeming anomaly of requiring the party actually making the entry to be separately served with a copy thereof by his adversary before the time to appeal started to run against him (Naftal v. Jarvis, 203 App. Div. 75). When the party himself makes the entry he clearly has knowledge of the adverse order or judgment (Corporation of Scholes v. Ficke Warehouses, 204 App. Div. 329). These cases antedate the enactment of section 1557-a of the Civil Practice Act and were decided at a time when it was the practice to pay scheduled filing fees when the final judgment or order was presented to the county clerk for entry and filing by the party of his attorney. The enactment of section 1557-a set up a superseding schedule of filing fees which, among other substitutions, provides for payment in advance of a fee for the assignment of an index number and when assigned, papers pertaining to the special proceeding or action are thereafter automatically accepted without further payment. This automatic entry of such final judgment or order is equivalent to personal entry by the party or his attorney. When a party submits a proposed judgment or order with notice of settlement to the clerk of the Special Term part in the counties of the city of New York he knows that the judge will either sign the same as submitted or make changes therein, and that when signed it will be automatically entered without further action on his part. This does not limit his rights in appeal procedure. The time to appeal is not thereby shortened or lengthened. He still has thirty days from the date of entry. This is not contrary to the general policy requiring a party who seeks to limit time to appeal to conform to strict practice (Kelly v. Sheehan, 76 N. Y. 325).

The relator here initiated the event which led to the ultimate entry of the order appealed from and must be bound by the time limitation its automatic entry started up. It is of small moment whether the order or judgment which the attorneys have submitted to the clerk for the Special Term part for consideration and signature of the justice is sent down “ automatically ” by the clerk or carried down personally by the attorney. The relator’s attorney had knowledge of the entry of the order in either event. To say of this record that the automatic entry of the order did not start the time running against the relator would be just as anomalous as the situation existing prior to the amendment of section 612 of the Civil Practice Act.

The order of the Appellate Division should be reversed and that of Special Term affirmed, with costs in this court and in the Appellate Division. The certified question should be answered in the negative.

Loughban, Ch. J., Lewis, Conway, Desmond, Fuld and Bbomley, JJ., concur.

Order reversed, etc.


author:
      Per Curiam.
     Desmond, J.

text:
    Enterprise Window Cleaning Co., Inc., et al., Respondents, v. Pete Slowuta, as President of the Window Cleaners Protective Union, Local No. 2, Appellant.
    Argued April 12, 1949;
    decided June 2, 1949.

      Michael F. Pinto and Benjamin D. Stein for appellant.
    I. A proper showing was made to Special Term by defendant union justifying the exercise of its power to vacate or modify its decree. (Western Union Tel. Co. v. International Brotherhood of Elec. Workers, 133 F. 2d 955.) II. Peaceful picketing by members of the union of an employer’s customers does not constitute per se an illegal secondary boycott. (Commercial House & Window Cleaning Co. v. Awerkin, 226 App. Div. 734; Superior House & Window Cleaning Co. v. Awerkin, 228 App. Div. 617; Spanier Window Cleaning Co. v. Awerkin, 225 App. Div. 735, 228 App. Div. 617; Goldfinger v. Feintuch, 276 N. Y. 281; Wohl v. Bakery & Pastry Drivers’ Union, 284 N. Y. 788, Bakery & Pastry Drivers Union v. Wohl, 315 U. S. 769; People v. Muller, 286 N. Y. 281; Schivera v. Long Island Lighting Co., 296 N. Y. 26; Cafeteria Employees Union v. Angelos, 320 U. S. 293; Lo Bianco v. Holt, 189 Misc. 113.)

      George P. Halperin, Leon Dicker and Fred S. Weitsner for respondents.
    I. Since the order appealed from rested in the discretion of the Appellate Division, the appeal therefrom presents no point for review and should be dismissed. (Matter of People [Second Russ. Ins. Co.], 244 N. Y. 606; Matter of Davids v. Sillcox, 297 N. Y. 355; United States v. Swift & Co., 286 U. S. 106.) II. There was ample basis for the discretion here exercised by the Appellate Division. (Milk Wagon Drivers’ Union v. Meadowmoor Dairies, 312 U. S. 287.) III. The picketing of plaintiffs’ customers, admittedly constituting a secondary boycott in 1933, is no less an illegal labor objective today. Hence, assuming that power existed to alter the final judgment which had stood unchallenged for over fourteen years, no case for the exercise of such power was presented by defendant’s motion to amend the judgment so as to authorize the revival of such picketing. (United States v. Swift & Co., 286 U. S. 106; Milk Wagon Drivers’ Union v. Meadowmoor Dairies, 312 U. S. 287; People v. Riley, 188 Misc. 969; Herpe v. Herpe, 225 N. Y. 323; Feinberg v. Feinberg, 180 Misc. 305; West 158th St. Garage Corp. v. State of New York, 256 App. Div. 401; Sears, Roebuck & Co. v. 9 Ave-31 St. Corp., 274 N. Y. 388; Opera on Tour v. Weber, 285 N. Y. 348; Canepa v. “John Doe ”, 277 N. Y. 52; Weil & Co. v. “ John Doe ”, 168 Misc. 211; Silverglate v. Kirkman, 171 Misc. 1051; Chapman v. Doe, 255 App. Div. 893; Elizabeth Arden Sales Corp. v. Hawley, 176 Misc. 821, 261 App. Div. 953; Jacobs v. Eisen, 272 App. Div. 976; Mayer Bros. Poultry Farms v. Meltser, 274 App. Div. 169.) IV. Assuming, arguendo, that the picketing of premises of plaintiffs’ customers was removed from the category of a secondary boycott by judicial doctrine evolved subsequent to the 1933 decree, such picketing is nevertheless within the proscription of the unfair labor practices provisions of the Federal Labor Management Relations Act of 1947 (the Taft-Hartley Law), whereby Congress declared a new public policy with respect to labor relations and which furnished a standard of judgment in cognate situations for all courts. In such circumstances the granting of the application to modify the decree, if not constituting error of law, was at least a gross abuse of discretion, which the Appellate Division properly corrected. (Truax v. Corrigan, 257 U. S. 312; Van Beeck v. Sabine Towing Co., 300 U. S. 342; United States v. Hutcheson, 312 U. S. 219; South & Central Amer. Commercial Co. v. Panama R. R. Co., 237 N. Y. 287.)
   Per Curiam.

While we would agree with much that is said by Judge Desmond, we cannot overlook that this is not an appeal from a judgment enjoining certain conduct, but an appeal from an order denying appellant’s application to modify an injunction entered by consent many years ago. The principles enunciated in the dissent have little if anything to do with the matter before us for the question posed is exceedingly narrow: whether the court below has abused its discretion in denying the application. The modification of an injunctive decree must rest upon a clear showing that the evils which justified the prohibition have vanished. No such proof is disclosed by this record. On the contrary, it is undisputed that violence and assault recurred many years after entry of the decree. Defendant did not prove — indeed did not undertake to prove — that * ‘ dangers, once substantial, have become attenuated to a shadow ” (United States v. Swift & Co., 286 U. S. 106, 119). In those circumstances we cannot hold that the Appellate Division has abused its discretion, or that the rights of the union’s membérs under the Federal Constitution have been violated (Milk Wagon Drivers’ Union v. Meadowmoor Dairies, 312 U. S. 287, 296). Absent those considerations, it cannot be questioned that this dispute presents a situation in which peaceful picketing of plaintiffs ’ customers to exert pressure upon plaintiffs would be permissible under the law of this State (People v. Muller, 286 N. Y. 281). Section 876-a of the Civil Practice Act, which limits any ‘‘ labor dispute ’ ’ injunction to an effective period of not more than six months, took effect subsequent to the entry of the injunction here in question. We do not consider the propriety of the court’s reference to the policy expressed in subdivision (b) of section 8 of the National Labor Eelations Act, as amended by section 101 of the Labor Management Eelations Act, 1947 (TI. S. Code, tit. 29, § 158, subd. [b]).

The order of the Appellate Division should be affirmed, with costs.

Desmond, J.

(dissenting). I dissent and vote to reverse, and to modify the 1933 injunction so as to-remove the ban against peaceful picketing of the business places of plaintiffs’ customers. I agree with Justice Shientag’s dissenting opinion in the Appellate Division, but, because of the difference between the jurisdiction of that court and ours, in such a situation, I comment further.

Ordinarily, the vacatur or modification of an injunction decree, originally entered on consent, would be discretionary with the Appellate Division, and its refusal so to modify would not, ordinarily, set up any question of law for our review. But a clear abuse by the Appellate Division of its discretion empowers us to review and requires us to reverse (Bunim v. Bunim, 298 N. Y. 391; see cases cited by Judge Crane at pages 13 and 14 of Jensen v. Union Ry. Co., 260 N. Y. 1). The order of the Appellate Division here appealed from was, in my view, totally unlawful since it deprived defendant union’s members of their clear, plain constitutional rights.

The 1933 injunction was signed, on consent, at a time when defendant was charged with, and presumably' was guilty of, violent picketing, and of boycott of plaintiffs’ customers, a boycott considered illegal because it had as its object the coercion of plaintiffs to join a certain employer’s association. The facts then existing presumably justified an injunction, even one so sweeping as to deny defendant’s right of peaceful picketing, since such picketing as there was in 1933, was for an illegal objective. But long years have passed, and now, sixteen years later, the members of defendant union, because of what they or their officers (or their predecessor officers or members) did in 1933, must, says the Appellate Division, still be forbidden their rights as citizens — and presumably their successors will still be under the same ban in the year 1999, or 2049, if the union should last that long — and all because of what happened in 1933. (There is, it should be said, some showing here of illegal activity against plaintiffs by this union as late as 1938, but giving plaintiffs’ affidavits every possible effect, it remains that at least since 1938, there has been no violation of public order or propriety by defendant.) How long must this union stay on probation?

That defendant union (as an original proposition aside from the 1933 injunction) had a right to picket plaintiffs’ customers can hardly now be doubted (People v. Muller, 286 N. Y. 281, and cases therein cited; see Schiverav. Long Island Lighting Co., 296 N. Y. 26). The Taft-Hartley Law’s prohibitions (U. S. Code, tit. 29, § 158, subd. [b], par. [4]) obviously have no application here. If we are seeking for statutory guidance, we should find it in our own State law: section 876-a of the Civil Practice Act defines a “ labor dispute ” so as to include the situation now existing in this case, forbids an original injunction on the present facts of this case, and limits any “ labor dispute ” injunction to an effective period of not more than six months.

In my view, the further continuation of so much of this old injunction as forbids peaceful and lawful .picketing, without any showing of any present danger of violence or other wrongs, is such a denial of defendant’s members’ rights as to be beyond the power of any court, and so, necessarily, an abuse of judicial discretion (Matter of Bojinoff v. People, 299 N. Y. 145,151).

Loughban, Ch. J., Lewis, Conway, Dye, Fuld and Bromley, JJ., concur in Per Curiam opinion; Desmond, J., dissents in opinion.-

Order affirmed.