author: Rippey, J. Lewis, J.

text:
    In the Matter of Emanuel L. Stammer, Respondent, against The Board of Regents of the University of the State of New York et al., Appellants.

      Argued November 18, 1941;
    decided January 22, 1942.

      John J. Bennett, Jr., Attorney-General (.Bernard Bienstock of counsel), for appellants.
    The finding that relator offered, undertook and agreed to cure and treat a -disease by a secret method, procedure,' treatment or medicine was sustained by sufficient legal evidence. (Niagara Falls Power Co. v. Water Power & Control Comm., 267 N. Y. 265; People ex rel. Freeborn & Co. v. Graves, 257 App. Div. 587; People ex rel. Bennett v. Laman, 277 N. Y. 368; Matter of Skinkle, 221 App. Div. 682; People ex rel. Doherty v. Martin, 84 Hun, 64; 148 N. Y. 757; People ex rel. Brown v. Green, 106 App. Div. 230; 184 N. Y. 565; Matter of Benjamin v. Rosenberg Bros., 180 App. Div. 234; 223 N. Y. 569; People ex rel. Folk v. Bklyn. Board of Police, 69 N. Y. 408; People ex rel. County of Delaware v. State Tax Comm., 184 App. Div. 691; People ex rel. Erie R. R. Co. v. Board of R. R. Comm., 54 App. Div. 615; Boyd v. Boyd, 252 N. Y. 422; Jordan v. Alder son, 48 Cal. App. 547.)

      Sidney Paymer for respondent.
    The relator having revealed to the committee the formula used was not guilty of a violation of subdivision 2(d) of section 1264 of the State Education Law (Cons. Laws, ch. 16). There is not sufficient legal evidence to sustain a finding that relator undertook to treat a patient with a secret medicine. (Matter of New York Water Service Corp. v. Water Power & Control Comm., 257 App. Div. 590; Matter of Skinkle, 221 App. Div. 682.)
   Rippey, J.

Dr. Emanuel L. Stammer, petitioner-respondent, a physician and surgeon of some twenty years of active practice with an unblemished record, was disciplined by the Department of Education for violation of the provisions of section 1264, subdivisions 2(a) and (d) of the Education Law (Cons. Laws, ch. 16). In accordance with authorized procedure (Education Law, § 1265, subd. 5; Civil Practice Act, art. 78, § 1296), an order was made transferring proceedings for review of the findings and order which resulted in his suspension from practice and the cancellation of his certificate to the Appellate Division, third department. There an order was made reversing and annulling, on the law and the facts, the determination and order under review.

Procedure in a case like the present is governed by section 1265 of the Education Law. Upon a complaint and charges being filed, the Committee on Grievances of the Board of Regents refers the matter to a subcommittee who makes a preliminary investigation and later, .if they feel the case warrants more attention, hold a formal hearing upon the charges; after the hearing the subcommittee makes findings and recommendations to the full Grievance Committee, who in turn, report to the Board of Regents, who make the final order.

The charges against respondent were made by one Violette Platt, a medical inspector in the Department of Education. She presented two charges, both of which were sustained, with all their accompanying specifications, by the Committee on Grievances and by the Board of Regents. He was charged, first, “ with fraud and deceit in the practice of medicine in violation of Section 1264, subd. 2(a) of the Education Law,” and, second, with offering, undertaking and agreeing to cure and treat a disease by a secret method, procedure, treatment or medicine in violation of Section 1264, subd. 2(d) of the Education Law,” both committed as follows:

“ Between on or about the first day of October, 1938, up to and including about the first day of January, 1939, one James Blakeney, being unlicensed to practice medicine in the State of New York, and respondent did offer, undertake, promise, agree and guarantee to treat and cure one Rose Brower for the disease of cancer by means of a secret remedy and formula, and the said Blakeney and respondent did in fact treat the said Rose Brower for the said cancer by means of the alleged secret remedy and formula which they, the said Blaken'ey and respondent did assert that they possessed exclusively.

(b) The representation, promise and guarantee of the said Blakeney and respondent that they would and could cure the said Rose Brower of her cancerous condition, was false, fraudulent and deceitful and was known by them to be false, fraudulent and deceitful in that there was and is no certainty as to the cure of cancer by any form of treatment.

(c) The representations of the said Blakeney and respondent that they had a secret remedy and formula for the treatment and cure of cancer was false, fraudulent and deceitful and the said Rose Brower was induced thereby to engage the services of the said Blakeney and respondent.

“ (d) The said Blakeney never has been and is not now licensed to practice medicine in the State of New York. Respondent’s acts in permitting said Blakeney to treat the aforesaid cancerous condition by the alleged secret formula and remedy and by his association with the said Blakeney in the said treatment, did aid and abet the said Blakeney to unlawfully practice • medicine. Respondent thereby held out the said Blakeney to the said Rose Brower as being able to treat a physical condition and disease by an alleged secret formula and remedy and thus misled and deceived the said Rose Brower.”

The case is open, to us to determine whether there was any sufficient legal evidence to sustain the findings and conclusions of the Board of Regents (Education Law, § 1265, subd. 5). The record of the hearing before the Subcommittee on Grievances disclosed the following:

Reportedly suffering desperately from an open, huge and foul-smelling cancerous growth on the side of her face and neck, beyond orthodox surgical and medical aid and given but a few weeks to live, volunteer social workers discovered impecunious Rose Brower and became interested in her case. She had been undergoing treatment at Queens General Hospital, was placed on the critical list and desperately ill and was finally discharged as beyond cure on August 31, 1938, but was advised to continue radiation theraphy at the clinic which she did. Medical records showed on September 22, 1938, that no benefit resulted from the treatment. A Mrs. Hendrickson had been taking her to and from the hospital at the times of clinical treatment. An interviewer at the hospital said that he knew a man who could positively cure cancer. Thereupon, after one of her treatments at the clinic and with the knowledge and consent of the interviewer and of the medical superintendent of the hospital and at the wish of Mrs. Brower, she was taken by Mrs. Hendrickson to Blakeney’s home. At that interview Mrs. Brower and Mrs. Elcasser, wife of the hospital interviewer, at the interviewer’s suggestion, were present. The respondent was not present. A Doctor Gilbert who was connected with the Queens General Hospital was supposed to be present but he was not there. Blakeney showed them photographs of cures he claimed to have effected on others, made various representations as to the efficacy of his treatment which was explained to consist of the application of a salve to the affected part to be changed each three hours for forty-eight hours when the roots would loosen from the normal tissue and the mass would drop off, but Blakeney refused personally to remove the bandage or undertake any treatment because Doctor Gilbert was not there. Blakeney told them he was not a physician.

On the following day, October 7, 1938, Blakeney was at the hospital and investigated the hospital charts and waited for Doctor Gilbert to arrive, but he did not appear. It was then decided to reach Doctor Stammer. Later, Mrs. Hendrickson and Blakeney found Doctor Stammer and the three went to Mrs. Brower’s house. Shortly after their arrival, Doctor Gilbert and the interviewer arrived from the hospital. Again information was given that Blakeney was not a physician. At Doctor Stammer’s request, the bandage was removed and Doctor Stammer examined the growth. The physician was told that the Browers were without means and said that he would like to help her if he could if her daughter-in-law would care for the dressings. Whereupon an appointment was made for him to visit her on the following day.

Thereafter respondent started to treat her with the salve, the daughter-in-law looking after the dressings. Doctor Stammer alone prepared and gave all treatment and gave all instructions for the care of Mrs. Brower. Although the salve was prepared for him by Blakeney, Doctor Stammer applied it and watched the results daily, Blakeney neither gave instructions nor participated in the treatments at any time. The patient. and her relatives were told that the salve to be used was being prepared by Blakeney from his own formula and they consented to its use. At first the salve was applied every three hours and later each four hours. Mrs. Brower, the daughter-in-law, testified on February 27, 1940. She said: As soon as we put this medicine on her it immediately cleaned up the odor. There was no more odor, there was no more discharge. Inasmuch as she had great pain it was nothing in comparison to what she had had before. As soon as this medication had taken place it seemed to have made her feel much better. * * * The ultimate result is the woman is living. * * * The growth has fallen out and scarred tissue, is comparatively small now. She has gained twenty pounds, her general health inasmuch as she is not a young woman any longer, she is well, as well as can be expected. * .* * There is nothing there, just scarred tissue there now. * * * All healed up.” After the ten-day treatment with the salve under the doctor’s orders and supervision, olive oil was applied until January, 1939, when the cure was complete. All told, the doctor made some hundred visits, visited her daily when necessary and has since watched the case — all without asking or receiving any compensation for his services.

It appeared that Blakeney had disclosed the formula for the salve to Doctor Stammer with directions as to how to use it some years before the treatment of Mrs. Brower, that the doctor was familiar with all its ingredients, had tried it on healthy skin before he used it on Mrs. Brower and found no ill results. One, at least, of its ingredients was in general use in cancer treatment. On the preliminary investigation of the case before the subcommittee of the Grievance Committee, the doctor disclosed to them the ingredients of the salve and the details of his use of it and later divulged the formula as and when requested and furnished detailed description of treatment to the full committee.

However much latitude there may be in the handling and in the decisions of cases committed to other administrative tribunals, the Education* Law (§ 1265, subd. 5) provides that the Committee on Grievances need not be bound by the laws of evidence in the conduct of its proceedings, but its determination must be founded upon sufficient legal evidence to sustain the same. Hearsay evidence alone does not meet the test. Th'e evidence must be of probative character. A decision based upon evidence other than that required by the statute is arbitrary and baseless. There is no evidence that Doctor Stammer practiced fraud and deceit and that charge has been abandoned by the appellants upon this appeal. Reliance is placed only on the second charge which arises out of section 1264, subdivision 2(d), of the Education Law which provides, so far as material, that “ The license or registration of a practitioner of medicine may be revoked, suspended or annulled or such practitioner reprimanded or disciplined in accordance with the provisions and procedure of this article upon decision after due hearing in any of the following cases: * * * (d) That a physician offered, undertook or agreed to cure or treat disease by a secret method, procedure, treatment or medicine or that he can treat, operate and prescribe for any human condition by a method, means or procedure which he refuses to divulge upon demand to the committee on grievances.” The commonly accepted and understood meaning of what is secret is that which is intentionally undisclosed or, as Webster puts it: “ Something studiously concealed, a thing kept from general knowledge, what is not, or is not to be, revealed.” The noun secret ” is similarly defined in the Century Dictionary. When used in a penal law, the word secret ” means studiously concealed.” (Ferrell v. State, 68 Tex. Crim. Rep. 487.) Generally, in law, a secret ” is something “ kept from the knowledge or notice of persons liable to be affected by the act, transaction, deed or other thing spoken of ” (Black’s Law Dictionary; Kaumagraph Co. v. Stampagraph Co., 235 N. Y. 1, 7). It is something intentionally and studiously concealed.

Within the commonly accepted meaning of the term secret,” and as used in the statute under consideration, we find no sufficient legal evidence in the case that the physician offered, undertook or agreed to cure or treat Rose Brower by any secret method, procedure, treatment or medicine. There was nothing secret about the medicine used or the method, treatment or procedure adopted. Indeed, the evidence is to the exact contrary. Neither did he studiously conceal the method, procedure or treatment which he adopted or the medicine which he used. Some years before he treated Rose Brower with the salve, Blakeney had divulged the formula to him and had explained to him the method of its use. There was evidence that Doctor Gilbert had previously attended cases where the formula and treatment had been used. Before undertaking treatment of Mrs. Brower the procedure and treatment were fully explained. It was disclosed that a salve was to be used, the results to be expected were discussed, and consent of the patient and of her relatives to the use of the salve and to the treatment to be given were obtained. The mere fact that the details of the formula were not known to the patient or to some other particular person did not make it secret. The affirmative and uncontradicted evidence in the case is that Doctor Stammer had proposed to disclose to the medical society both the formula and treatment if it -had merit and that he divulged upon demand to the Committee on Grievances the method, procedure and treatment adopted and used by him. The attempt to help Rose Brower by treatment outside of electro-theraphy was known to and approved by physicians connected with the hospital in whose clinic she was under treatment. The evidence is conclusive that respondent made no promise or representation that the treatment would cure the patient. Even had he done so, in the absence of fraud and deceit it would have been merely an expression of opinion and he would have committed no offense under the statute. If Blakeney at any time made any such representation, it was not made in the presence of Doctor Stammer or with his knowledge and any evidence thereof that appears in the record is not the legal evidence required by the statute or binding upon the doctor. It is quite immaterial that Blakeney did not disclose the formula and treatment to the Committee on Grievances previous to the formal hearing in this case even though such had been the fact. There is no evidence that he refused to divulge it to them or that they ever demanded it of him. The statute imposed no duty on him to make such disclosure in any event. Blakeney was not on trial. He was not a physician subject to discipline under the statute. He died before the trial of Doctor Stammer commenced and it was beyond the power of the doctor to show upon the hearing, though there was no legal requirement that he should do so, that the formula and treatment had not been disclosed generally by Blakeney during his lifetime to others.

By every test set by the Legislature, respondent committed no act condemned by the statute for which discipline could be imposed.

The order appealed from should be affirmed, with costs.

Lewis, J.

(dissenting). The Board of Regents is' the agency designated by the Legislature to supervise the licensing of physicians in this State. (Education Law, § 51.) When the Board suspended for one year the license granted to the respondent, after a hearing held pursuant to section 1265 of the Education Law, its action was in the exercise of an administrative discretion. (Education Law, §§ 1264, subd. 2 [d], 1265 and 1266.) Accordingly, in the present proceeding under article 78 of the Civil Practice Act, we are to determine whether the record discloses circumstances which left any possible scope for the reasonable exercise of that discretion' in the manner which led to the Board’s order of suspension. (Matter of Durr v. Paragon Trading Corp., 270 N. Y. 464, 469; Matter of Stracquadanio v. Dept, of Health, 285 N. Y. 93, 96.) In pursuing the inquiry I have in mind the ruling by this court that The regulation of the practice. of medicine is undertaken by the State not for the protection of the physicians themselves, but for the protection and welfare of the people. * The power of the State to provide for the general welfare of its people authorizes it to prescribe all such regulations as, in its judgment, will secure or tend to secure them against the consequences of ignorance and incapacity as well as of deception and fraud.’ ” (People ex rel. Bennett v. Laman, 277 N. Y. 368, 374, 375; Dent v. West Virginia, 129 U. S. 114, 122.)

The respondent was suspended by the Board of Regents which sustained a finding by its Medical Committee on Grievances that he was guilty of the charge made under section 1264, subdivision 2(d), of the Education Law that he “ * * * . offered, undertook or agreed to cure or treat disease by a secret method, procedure, treatment or medicine * * *,”

In October, 1938, a woman — to whom I shall refer as “ the patient ”— was attending a clinic at Queens General Hospital for treatment of a facial growth which had been diagnosed as a cancer. In the course of such treatments she was induced by persons not connected with the hospital to consult a man who was introduced to her as “ Doctor Blakeney ” and who, concededly, was not licensed to practice medicine. Noting that the patient’s face was bandaged, Blakeney told her he would not remove the bandage unless a doctor was present. He did, however, make a superficial examination of the afflicted portion of the patient’s face after which, it is said, he advised her that “ he positively could cure it.” He stated that the treatment would involve the application every three hours of a salve which would loosen the roots of the diseased mass and would separate it from the normal tissue. There is also testimony that when one of the persons present in the room suggested to Blakeney, “ If you have this cure don’t you think you ar'e in duty bound to give it to the Medical Society? ” Blakeney replied, “No, not as long as I live, and when I die I will take it to my grave.”

Three years prior to that time Blakeney had told his friend Doctor Stammer — the respondent upon this appeal ■— that he had a salve which had been “ left to him by a relation ” which was used in the treatment of cancer. Blakeney had never used the salve himself although there is proof that he exhibited photographs of persons upon whom the salve had been used.

On October 7, 1938, the respondent went to the patient’s home accompanied by Blakeney. After examining the patient the respondent said: “ Before I touch this case I want to know whether you are going to continue with the clinic.” Upon receiving her assurance that she would not return to the clinic, the respondent stated: “ Once I start the case I want you to be through with Queens General Hospital for good unless my treatment fails.” Meantime the respondent had been told by the patient’s daughter-in-law that the patient would die within three weeks. When questioned upon the hearing what he said to the daughter-in-law the respondent replied: I didn’t tell her anything except that I have a formula or a salvé that is used for skin cancer. * * * I told her I was willing to use it, to try it out, I had never used it before, if it worked it would be all right, but I never used it previously, we will try it, there is nothing to lose, she is going to die in three weeks and if it benefited, well and good.”

The first treatment, when the salve was applied by the respondent, was on the following day, October 8,1938, and thereafter, in accord with directions given by the respondent, fresh applications of the salve were made every three hours for seventy-two hours. On January 5, 1939, word came to the respondent from the patient that the tumor mass had fallen out.” Since that time healing has taken place and there remains only a scar at the point where formerly there existed the growth diagnosed as a cancer.

The respondent admits that when he started to treat the patient by applying the salve he was not sure of its merit. The record shows that aside from being told by Blakeney that a relative had “ left it to him ” the respondent had no personal knowledge concerning the salve except that it was a “ brownish color.” Five pounds of the salve — which was contained in jars which bore no labels — were used in treating the patient, all of which was supplied by Blakeney who prepared it at a place and under conditions unknown to the respondent. Although the respondent admits that Blakeney knew nothing about skin cancer, the respondent applied the salve to the diseased mass upon the patient’s face without consultation with a chemist, a pharmacist or another doctor to determine by analysis whether the salve contained ingredients ■ which had therapeutic value and were appropriate for the treatment of cancer. In that connection the respondent stated that before he started the treatments, the only “ clinical experiment ” made by him was when “ I tried it on myself,” his comment at the hearing being, “ As long as it didn’t injure healthy skin it certainly had no ill effect on unhealthy skin.”

Blakeney did inform the respondent that the salve contained four ingredients apportioned as follows: zinc sulphate, five per cent; a Chinese spice known as galanga, twenty per cent; sanguinaria, fifty per cent and lanolin, twenty-five per cent. The respondent knew nothing about the ingredients except that zinc sulphate “ is used in the treatment of cancer, as an escharotic.” As to the use, in the treatment of cancer, of a Chinese spice known as galanga —'which according to the formula, composed twenty per cent of the salve — he had never heard of it. In short, except for the statement made to him by Blakeney — who was not proved to have expert knowledge — the record fails to show that the respondent had any information as to the curative properties of the ingredients, except the zinc sulphate, and he denied knowledge whether in the preparation of the salve Blakeney had adhered exactly to the proportions stated in the formula.

I have referred to Blakeney’s statement that he would not divulge the formula during.his lifetime. It appears however, as we have seen, that he did inform the respondent of the formula, and that he prepared and furnished to the respondent the salve which was applied in the treatments given to the patient. The respondent concedes that at the time he started to treat the patient it was his intention to keep secret the salve until he proved its value. When asked upon the hearing before the Medical Grievance Committee the direct question whether he and Blakeney considered the formula a secret between themselves, his answer was: I don’t know whether it was a secret or not. I wouldn’t say yes and I wouldn’t say no.” There is no evidence that Blakeney, now deceased, ever divulged the formula except to the respondent. As to whether the respondent himself kept the formula as a secret, I find that when the respondent was asked upon the hearing, “ Have you divulged that formula to anybody except the Medical Grievance Committee to date? ” he replied, I didn’t divulge it to anybody except the Committee.”

I construe subdivision 2 (d) of section 1264 of the Education Law as authorizing disciplinary action by the Board of Regents whenever, under procedure prescribed by section 1265, it is determined that a physician (1) “ * * * offered, undertook or agreed to cure or treat disease by a secret method, procedure, treatment or medicine * * or (2) that he “ * * * offered, undertook or agreed * * * that he can treat, operate and prescribe for any human condition by a method, means or procedure which he refuses to divulge upon demand to the committee on grievances,” or (3) “ that he has advertised for patronage by means of handbills * * *,” etc. In my opinion the facts before us constitute evidence that the respondent “ * * * undertook * * * to * * * treat disease by a secret * * * medicine * * * ” — within the provisions of section 1264, subdivision 2(d), supra. That evidence affords a basis sufficient for the disciplinary action taken by the Board of Regents which is the subject of the respondent’s challenge in this proceeding.

If, as I believe, there is in the record at hand evidence which warrants the exercise by the Board of Regents of administrative discretion within the field defined by the statutes cited, the purpose of the Legislature has been accomplished in this instance. Those seeking medical attention have no means of estimating the skill and ability of the physician, and must depend upon the State to permit only those qualified tó engage in that profession.” (People ex rel. Bennett v. Laman, supra, p. 375.)

I vote for a reversal of the order of the Appellate Division and the reinstatement of the disciplinary order of the Board of Regents.

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

Order affirmed.


source: Caselaw Access Project

author: Desmond, J. Conway, J.

license: Public Domain

text:
    Bert Kirkman, as President of Local Union No. 3 of the International Brotherhood of Electrical Workers, Respondent, v. Westchester Newspapers, Inc., et al., Appellants. Bert Kirkman et al., Appellants, v. Westchester Newspapers, Inc., et al., Respondents.
    Argued November 19, 1941;
    decided January 22, 1942.

      Harold Stern and George Rosling for plaintiffs, appellants and respondents.
    An unincorporated association may maintain an action for libel. (N. Y. Society v. Macfadden Publications, 260 N. Y. 167; Philipp v. New. Yorker Staats-Zeitung, 165 App. Div. 377; Stone v. Textile Examiners Employers’ Assn., 137 App. Div. 655; Bradley v. Conners, 169 Misc. Rep. 442.) The complaint states a cause of action for libel as to the union. (More v. Bennett, 48 N. Y. 472; Klaw v. N. Y. Press Co., 137 App. Div. 686; Hall v. Binghamton Press Co., 29 N. Y. Supp. [2d] 760; Townes v. N. Y. Evening Journal Pub. Co., 109 App. Div. 852; Sweet v. Ken, Inc., 169 Misc. Rep. 407; 256 App. Div. 1063; Kraft v. Araujo, 238 App. Div. 324; Jackson v. Consumer Pub., Inc., 256 App. Div. 708.) The innuendo was properly pleaded. It does not in any event affect the sufficiency of the complaint. (Klaw v. N. Y. Press Co.,
      137 App. Div. 686; Barnard v. Press Pub. Co., 63 Hun, 626; Hall v. Binghamton Press Co., 29 N. Y. Supp. [2d] 760; Cafferty v. Southern Tier Pub. Co., 226 N. Y. 87; Morrison v. Smith, 177 N. Y. 366; Shubert v. Variety, 128 Misc. Rep. 428; 221 App. Div. 856.) The complaint states a cause of action for libel as to each of the individual plaintiffs. (Dall v. Time, Inc., 252 App. Div. 636; Birnham v. Hornaday, 130 Misc. Rep. 207; 223 App. Div. 218; Thomas v. Moore, [1918] 1 K. B. 555.)

      Joseph Reeback and Charles S. Cunningham for Westchester Newspapers, Inc., et al., respondents and appellants.
    Each of the causes of action of the sixteen union officials is insufficient because it app'ears from its face that the publication does not refer to an ascertained or ascertainable person who is the plaintiff. (Hays v. American Defense Society, 252 N. Y. 266; Feely v. Vitagraph Co., 184 App. Div. 527; Service Parking Corp. v. Washington Times Co., 92 Fed. Rep. [2d] 502; Stroud v. Harris, 5 Fed. Rep. [2d] 25; Owens v. Clarke, 154 Okla. 108; Harvey v. Coffin, 5 Blackf. [Ind.] 566; Gross v. Cantor, 270 N. Y. 93; Van Heusen v. Argenteau, 194 N. Y. 309; Fleischmann v. Bennett, 87 N. Y. 231; Corr v. Sun Printing & Pub. Assn., 177 N. Y. 131.) The publication is not libelous per se of the local union and, therefore, the complaint of its president should have been dismissed. (Kloor v. N. Y. Herald Co., 200 App. Div. 90; Tanzer v. Crowley Publishing Corp., 240 App. Div. 203; Baumann v. Baumann, 250 N. Y. 382; Labouisse v. Evening Post Pub. Co., 10 App. Div. 30; Rossiter v. New York Press Co., 141 App. Div. 339; Smid v. Bernard, 31 Misc. Rep. 35; Morrison v. Smith, 177 N. Y. 366; Crashley v. Press Pub. Co., 179 N. Y. 27; N. Y. Bureau of Information v. Ridgway-Thayer Co., 193 N. Y. 666.) The complaint of Kirkman, as president of the local union, an unincorporated association, is insufficient since it appears therefrom that the members of the union do not have any joint or common interest in the cause of action as required by section 12 of the General Associations Law and since the criticism of the association constitutes an impersonal reproach of an indeterminate class. (Ostrom v. Greene, 161 N. Y. 353; Bossert v. Dhuy, 166 App. Div. 251; 221 N. Y. 342; Picket v. Walsh, 192 Mass. 572; Hanley v. American Ry. Express Co., 244 Mass. 248; Lloyd v. Sloan, 259 App. Div. 615; McMahon v. Rauhr, 47 N. Y. 67; Mandell v. Cole, 244 N. Y. 221; Giraud v. Beach, 3 E. D. Smith, 337; McCabe v. Goodfellow, 133 N. Y. 89; Schouten v. Alpine, 215 N. Y. 225; Mercantile Marine Service Assn. v. Toms, [1916] 2 K. B. 243; Hardie v. Chiltern, [1928] 1 K. B. 663; Gatley on Libel & Slander [3d ed.], 464, 465; Markt & Co. v. Knight Steamship Co., [1910] 2 K. B. 1021; Gross v. Cantor, 270 N. Y. 93; People v. Eastman, 188 N. Y. 478; Weston v. Commercial Advertiser Assn., 184 N. Y. 479.) The General Associations Law does not permit an unincorporated association to sue and be sued as a legal entity, but, on the contrary, merely authorizes a representative suit or defense on behalf of the associates. (McCabe v. Goodfellow, 133 N. Y. 89; Schein v. Erasmus Realty Co., 194 App. Div. 38; Bossert v. Dhuy, 166 App. Div. 251; 221 N. Y. 342; Hagan v. Bricklayers Union, 143 Misc. Rep. 591; Andrews v. Local Union No, 13, 133 Misc. Rep. 899; Meinhart v. Contresta, 194 N. Y. Supp. 593; Bobe v. Lloyds, 10 Fed. Rep. [2d] 730; People ex rel. Solomon v. Brotherhood of Painters, 218 N. Y. 115; Schouten v. Alpine, 215 N. Y. 225; Havens v. King, 221 App. Div. 475.) The publication does not warrant, as a matter of law, the innuendo pleaded. (Fleischmann v. Bennett, 87 N. Y. 231; Hays v. American Defense Society, 252 N. Y. 266; Hoeppner v. Dunkirk Printing Co., 254 N. Y. 95; Fry v. Bennett, 7 N. Y. Super. Ct. [5 Sanf.] 54; Stevens v. Whelan, 234 App. Div. 118; Cook v. Mirsky, 249 App. Div. 394; Morrison v. Smith, 177 N. Y. 366.)

      Isaac W. Digges and Gilbert H. Weil for McClure Newspaper Syndicate, Inc., et al., respondents and appellants.
    The Appellate Division erred in affirming the order of the lower court which denied the defendants’ motion to dismiss the first cause of action as insufficient in law upon its face. (O’Connell v. Press Pub. Co., 214 N. Y. 352; Crashley v. Press Pub. Co., 179 N. Y. 27; Hays v. American Defense

      Society, 252 N. Y. 266; Fleischmann v. Bennett, 87 N. Y. 231; Ben-Oliel v. Press Pub. Co., 251 N. Y. 250; Moore v. Francis, 121 N. Y. 199; Labouisse v. Evening Post Pub. Co., 10 App. Div. 30; Foot v. Pitt, 83 App. Div. 76; Cafferty v. Southern Tier Pub. Co., 226 N. Y. 87.) The order of the Appellate Division dismissing the sixteen causes of action of the union officials on the ground that the complaint fails to state a cause of action in libel as to any of the officials, and the judgment against the individual plaintiffs, should be affirmed. (Hays v. American Defense Society, Inc., 252 N. Y. 266; Corr v. Sun Printing & Pub. Assn., 177 N. Y. 131; Fleischmann v. Bennett, 87 N. Y. 231; Feely v. Vitagraph Co., 184 App. Div. 527; Hauptner v. White, 81 App. Div. 153; Knickerbocker v. Press Pub. Co., 143 App. Div. 138; Fagan v. New York Evening Journal Pub. Co., 129 App. Div. 28.)

      Allan S. Locke for James McMullin, respondent and appellant.
    The intendment of the newspaper article of which the plaintiff labor union and officials complain is not directed at the plaintiff union, nor is it libelous per se. (Willis v. Eclipse Mfg. Co., 81 App. Div. 591; N. Y. Bureau of Information v. Ridgway-Thayer Co., 119 App. Div. 339; 193 N. Y. 666; Adirondack Record, Inc., v. Lawrence, 202 App. Div. 251; Baker v. Warner, 231 U. S. 588; Hays v. American Defense Society, 252 N. Y. 266; National Variety Artists, Inc., v. Masconi, 169 Misc. Rep. 982; Corr v. Sun Printing & Pub. Assn., 177 N. Y. 131; Van Heusen v. Argenteau, 194 N. Y. 309; Kuhn v. Veloz, 252 App. Div. 515; Hoeppner v. Dunkirk Printing Co., 227 App. Div. 130; Kimmerle v. N. Y. Evening Journal, Inc., 262 N. Y. 99.) In the absence of an enabling statute, an unincorporated association may not sue or be sued in the association’s name. Actions permitted by the president or treasurer of such an association under section 12 of the General Associations Law being specifically limited to causes of action where each of the members of the association has a joint or common interest with all of the other members in the cause of action, no action for defamation by the plaintiff union lies. {Mein

      hart v. Contresta, 194 N. Y. Supp. 593; Rodier v. Fay, 7 N. Y. Supp. [2d] 744; McCabe v. Goodfellow, 133 N. Y. 89; Edwards v. Warren L. & G. Works, 168 Mass. 564; United Mine Workers v. Coronado Coal Co., 259 U. S. 344; Mercantile Marine v. Toms, [1916] 2 K. B. 243; Hardie v. Chiltern, [1928] 1 K. B. 663; Markt v. Knight, [1910] 2 K. B. 1040; U. S. & Cuban Allied Works Engineering Corp. v. Lloyds, 291 Fed. Rep. 889; N. Y. Society v. Macfadden Publications, 260 N. Y. 167; Bradley v. Conners, 169 Misc. Rep. 442; Peacock v. Tata Sons, Ltd., 206 App. Div. 145; Wright v. Afro-American Co., 152 Md. 587; Giraud v. Beach, 3 E. D. Smith, 337.)
   Desmond, J.

This opinion deals only with the first cause of action in the complaint. All of the judges concur in Judge Conway’s opinion in so far as it treats of the second to seventeenth causes of action, as to which causes of action Judge Conway’s opinion, is, therefore, the opinion of the whole court.

As to the first cause of action asserted by Kirkman, as president of the local union, the principal argument advanced against its sufficiency is that “ a plurality of persons * * * never has a joint or common interest in a cause of action for' libel.” Therefore, we are told, a cause of action for libel is not one of those on which the president of an unincorporated association may sue, on behalf of the association, under the terms of section 12 of the General Associations Law (Cons. Laws, ch. 29). The unincorporated association which plaintiff Kirkman represents in this action was formed for definite purposes and is engaged in activities intended to carry out those purposes for the benefit of all the members of the association. The article charges wrongdoing by officers of this association in performance of the work of the association. It does not reflect upon, or tend to injure the reputation of the individual members but it does tend to discredit the work in which they have a common interest. The injury is thus a common injury and the members have a common interest in the consequent damages. The com- - plaint asserts that this local union of which Kirkman is president, has a “ high and enviable reputation ” because of its success in collective bargaining and because it has provided for its members educational advantages, sick and death benefits, etc. Is not that reputation the common property of its members as such? This court in New York Society for the Suppression of Vice v. Macfadden Publications, Inc. (260 N. Y. 167, 170), said as to a membership corporation not operated for pecuniary gain, that “ to decide that such corporations have no reputation acquired in the management of their affairs and property which can be injured or destroyed by a malicious libel, unless special damage .is proved, would constitute a reflection upon the administration of justice.” So as to an unincorporated association with similar objects and purposes. The courts have no less a duty in this case than in a suit brought by a corporation or an individual, to protect good name, reputation and credit from slanderous or libelous attacks.

The history of the law of libel in this State as to partnerships and corporations has led us by successive steps to the rule that we now announce as to unincorporated associations. As early as 1853, in Taylor v. Church (8 N. Y. 452), this court held that mercantile partners might sue for libel and recover for the injury done to the character, standing and credit of their firm. In 1862, in Shoe & Leather Bank v. Thompson (23 How. Pr. 253, 255), there was a similar holding in favor of a libeled banking corporation. There the court, applying the principle that there is no wrong without a remedy, said of the corporation plaintiff: “ It is recognized by the law as being engaged in business, and as being possessed of property. This recognition, as to its rights in these respects, is as effectual and complete as in the case of private individuals.” Coming down to more recent times, this court said in 1906 of another corporate plaintiff in an action for libel that it was as much entitled to the protection of the law as a natural person, that its right to be protected against false and malicious statements affecting its property or credit was beyond question, and that a corporation need not allege or prove specific damage, when the language complained of “ is of so defamatory a nature as to directly affect credit and to occasion pecuniary injury.” (Reporters’ Assn. v. Sun Printing & Pub. Assn., 186 N. Y. 437, 440, 441. See, also, Mutual Reserve Fund Assn. v. Spectator Co., 50 N. Y. Super. Ct. Rep. 460, decided in 1884, and Philipp Co. v. New Yorker Staats-Zeitung, 165 App. Div. 377, 392, decided in 1914.) And in New York Society for the Suppression of Vice v. Macfadden Publications, Inc. (supra), we said, further, that this rule was just as applicable to non-profit, or benevolent corporations, as to business corporations. We now hold that it is equally applicable to unincorporated associations, also, and that such associations are to be regarded as entities to the extent necessary to permit suits for libel to be brought in their behalf, by their officers.

Labor unions play a large and important role in modern life. The “ growth and necessities of these great labor organizations have brought affirmative legal recognition of their existence and usefulness and provisions for their protection, which their members have found necessary.” (United Mine Workers v. Coronado Coal Co., 259 U. S. 344, 385.) We know that they are rarely incorporated. We should not require them to assume the form of corporations, in order to be recognized as possessing reputations which the law will protect. The courts which recognize a labor union’s existence and its traditional form of organization, will not refuse to redress a wrong done to it in its group or unified character. Such a wrong is alleged in the first cause of action here, which complains of a libelous attack not on the reputation of the individual members but on the reputation of the association as such. The newspaper article, read as a whole and reasonably interpreted, would justify a jury’s finding that it charged the local union with unfairness and overcharging, if not extortion. The first certified question, therefore, is to be answered in the affirmative.

Besides a question as to the sufficiency of the first cause of action, the Appellate Division has certified to us another question concerning the correctness of an order.made at Special Term and affirmed by the Appellate Division, which denied defendants’ motion to strike out certain matter from the first cause of action. This matter was pleaded by way of innuendo. Without discussing this innuendo at length, we conclude that the quoted words of the article are capable of the meaning ascribed to them by the innuendo and that it will be for the jury to say whether they were in fact so understood. Indeed, it may here be said that the innuendo which Special Term refused ’to strike out is practically a paraphrase of the quoted language of the article itself, and that, therefore, its retention in the complaint does not harm defendants.

Upon plaintiffs-appellants’ appeal the judgment of the Appellate Division, dismissing the second to seventeenth causes of action, should be reversed, and the motion to dismiss such causes of action denied, with costs in this court and in the Appellate Division; upon the appeal of defendants-appellants the order of the Appellate Division, in so far as it affirms the orders of Special Term, should be affirmed, with costs. The questions certified should be answered in the affirmative.

Conway, J.

(dissenting). The amended complaint sets forth seventeen causes of action against the defendants, the first cause of action on behalf of an unincorporated association and the remaining ones by the individual officials thereof. The motion made by defendants to dismiss the complaint before answer and to strike out certain portions of the allegations was granted by Special Term to the extent only that a portion of the innuendo was stricken from the complaint.

The Appellate Division dismissed the second to seventeenth causes of action brought by the individual plaintiffs and, as so modified, the order of Special Term was affirmed. The first cause of action thus was sustained and the action then severed. On the motion made by defendants to the Appellate Division for leave to appeal to this court, two questions of law were certified to us as follows:

“ 1. Does the first cause of action in the amended complaint state facts sufficient to constitute a cause of action?

“ 2. Does the publication of which plaintiffs complain warrant, as a matter of law, that portion of the innuendo pleaded in the first cause of action and which the Special Term declined to strike out upon the motions of the defendants? ”

Plaintiffs appealed as of right from the judgment entered upon that part of the order of the Appellate Division which dismissed the second to seventeenth causes of action.

The complaint alleges that the plaintiff Local Union No. 3 of the International Brotherhood of Electrical Workers (hereinafter referred to as “ local union ”) was an unincorporated association of approximately 17,000 members, constituting a labor union affiliated with the American Federation of Labor; that during the months of May, June and July, 1939, the defendant McMullin, as the agent of defendant McClure Newspapers Syndicate and defendant Westchester Newspapers, Inc., “falsely and maliciously composed ” and defendant McClure Newspapers Syndicate, Inc., and defendant Waldo “ falsely and maliciously published ” and sold to defendants Westchester Newspapers, Inc., and Arthur C. Saunders for publication, and that the last mentioned corporation and Arthur C. Saunders, on or about July 3, 1939, published “ concerning said local union and its officials ” the following “ false, libelous and defamatory matter, to wit:

“ Our report that union officials aré feathering their nests from initiation fees and dues payments is also challenged. The point is made that Local Union 3 voted to allow members of out of town locals to work here during the World’s Fair boom without paying a cent to the_New York local.
“ It is argued, therefore, that the North Carolina youngster with only amateur experience, who, we stated, got a very profitable electrician’s job, needn’t have * paid a price ’ for the privilege. A recheck discloses that he did pay a price — and a stiff one. It was, however, paid privately to an official of Local 3 and probably never appeared in the union’s books. Evidently the rank-and-file members of Local 3 are not aware of the practices indulged in by some of their associates.
The plain fact is that this union and others took advantage of the setup to charge more than the traffic would have borne on any normal job.”

The complaint then sets forth the innuendo.. It is unnecessary for us to consider it, in view of the conclusion which I have reached as to the first cause of action. It is then further alleged in the first cause of action that the defendants knew or should have known that the statements made were untrue; that the article did hold the plaintiff, local union, and its members, up to public scorn, hatred and ridicule, and did greatly injure plaintiff, local union, and its members, in their reputation, business and credit;” and that the plaintiff union has been damaged thereby in the sum of $100,000.

Each of the causes of action from the second to the seventeenth is brought by an official of the plaintiff local union, viz., the president, the vice-president, treasurer, financial secretary, business manager, assistant business manager, recording secretary and nine business agents. Each states the office of the individual plaintiff in the local union. The allegations made in the first cause of action are reiterated except those concerning the business purposes of the local union and that the article held the local union up to ridicule and injured its reputation, business and credit. Instead it is alleged that the article was calculated to and did hold the individual plaintiff official up to public scorn, hatred and ridicule, and did greatly injure him in his reputation, business and credit and that each of the individual plaintiff officials was damaged in the sum of $50,000.

I shall consider first the plaintiffs’ appeal as of right from the judgment entered upon that part of the order of the Appellate Division which dismissed the second to the seventeenth causes of action. The first sentence of the alleged libel reads as follows: Our report that union officials are feathering their nests from initiation fees and dues payments is also challenged.” That is clearly a republication of a prior statement to the same effect. It is a definite statement, when taken in connection with the second sentence which refers to local union 3, that each union official of that union was misappropriating moneys for his .own benefit from initiation fees and dues, or a jury could so find as a reasonable interpretation of the language used. (Gross v. Cantor, 270 N. Y. 93, 96.)

It is true that the use of the word “ recheck ” indicates review and correction and the statement is then made that the money was paid to but one official, but in view of the first sentence, that would be but a correction which might be pleaded in mitigation of damages.

As indicated, supra, the first cause of action is brought under section 12 of the General Associations Law by the president of the local union on behalf of its members and not by the union. The section gives the right to bring an action in certain instances to the president or treasurer of an unincorporated association and it is only by statutory permission that it may be brought. The statute enables an unincorporated association to sue .in the name of an officer; in place of the common law requirement that all of the members must sue independently. That right, of course, does not affect or change the status of the unincorporated association nor give to it a legal entity separate from the persons who compose it. (Mandell v. Cole [Lehman, J.], 244 N. Y. 221, 227; Ostrom v. Greene [Vann, J.], 161 N. Y. 353, 361; Moffat Tunnel League v. United States, 289 U. S. 113, 118; Shapiro v. Amalgamated Watchmakers Union, 2 C. C. H. Lab. Cas. 222 [contempt]; United States v. Local 807 of International Brotherhood, 118 Fed. Rep. [2d] 684, 688 [prosecution under Anti-Racketeering Act]; Hanley v. American Ry. Express Co., 244 Mass. 248, 250; Pickett v. Walsh, 192 Mass. 572, 589; Ludwig Teller on Labor Disputes and Collective Bargaining, vol. 2, § 462; 1 Fletcher, Cyclopedia of the Law of Private Corporations [permanent ed.], § 22, p. 72.) In Ostrom v. Greene .(supra), this court said in referring to an unincorporated association: “ It had no charter from the state giving it certain powers and subjecting it to certain limitations and liabilities. It had no right to use a common seal, no power of perpetual succession or of contracting under a corporate name. It was not an artificial person and had no distinct existence independent of its members. It was not a collective whole, which, as such, could.hold property or dispose of it.”

In Hanley v. American Ry. Express Co. (supra) the court said: “ This ‘ local ’ is merely a voluntary association of some three hundred members, and has no separate existence in law — unlike a corporation which is a legal person quite apart from its stockholders.”

In United States v. Local 807 of International Brotherhood (supra) the court said: “First, I do not see how a conviction can be had against the unincorporated Local 807 under the Anti-Racketeering Act; in other words, person ’ in the act does not include such an amorphous group as this association of around 10,000 persons. It is horn-book law that, absent a clear legislative intent, an unincorporated association does not commit crimes, 7 C. J. S., Associations, § 17, p. 43; and Congress has often shown that it knows how to include an association as a person when it so desires, as in the Sherman and Clayton acts, 15 U. S. C. A. §§ 7, 12, and literally a host of others, but not in the general construction law, 1 U. S. C. A. § 1.” An action under section 12 of the General Associations Law must be to recover property or be upon a cause of action for or upon which all of the associates may maintain such action by reason of their joint or common interest or ownership in the property or the cause of action.

The section reads as follows:

“ § 12. Action or proceeding by unincorporated association.
“ An _action or special proceeding may be maintained, by the president or treasurer of an unincorpOTated association to recover any property, or upon any cause of action, for or upon which all the associates may maintain such an action or special proceeding, by reason of their interest or ownership therein, either jointly or in common. An action may likewise be maintained by such president or treasurer to recover from one or more members of such association his or their proportionate share of any moneys lawfully expended by such' association for the benefit of such associates, or to enforce any lawful claim of such association against such member or members.”

An action for personal injury such as libel (Gen. Constr. Law, § 37-a; Cons. Laws, ch. 22) is always an individually owned cause of action. The authorities to that effect are collated and quoted from in Peacock v. Tata Sons, Ltd. (206 App. Div. 145, 146). I shall call attention to but one: In Newell on Slander and Libel ([3d ed.], p. 435) it is said: It has always been held that when words are spoken of two or more persons, they cannot join in an action for the words, because the wrong done to one is no wrong to the other. To. this rule there appears to be two exceptions (1) defamatory words published of partners in the way of their business, and (2) slander of the title of joint owners of land.’ ” (See, also, Schouten v. Alpine, 215 N. Y. 225, 232; McCabe v. Goodfellow, 133 N. Y. 89; Seelman on the Law of Libel and Slander in the State of New York, par. 88, citing Giraud v. Beach, 3 E. D. Smith, 337; Stone v. Textile Examiners and Spongers Union, 137 App. Div. 655; Ostrom v. Greene, 161 N. Y. 353, 361; Hardie & Lane, Ltd., v. Chiltern, [1928] 1 K. B. 663; Mercantile Marine Service Assn. v. Toms, [1916] 2 K. B. 243; Markt & Co. v. Knight Steamship Co., [1910] 2 K. B. 1021, 1040; Gatley on Libel and Slander [3d ed. 1938], pp. 464, 465; Eraser on The Law of Libel and Slander [6th ed.], pp. 373, 374.) A plurality of persons, except as noted, thus never has a joint or common interest in a cause of action for libel.

Apart from that entirely, however, in this instance it is clear from the article that the individual members of the union or, as the statute calls them, associates,” were not libeled. In fact there is no claim that they were. Since they were not libeled they have no interest or ownership ” in any cause of action and, of course, no one may on their behalf bring an action for a non-existent tort.

All the cases cited in Judge Desmond’s opinion, except two, involve corporations and are not applicable here. One of those two cases was brought by copartners and falls within one of the exceptions. The other, United Mine Workers v. Coronado Coal Co. (259 U. S. 344) was an action against an unincorporated association and was decided under the Sherman Anti-Trust Law (26 Stat. 209) and other applicable federal statutes. With reference to that decision, Harper on the Law of Torts, section 300, says:

“ In United Mine Workers v. Coronado Coal Co., (259 U. S. 344, 66 L. ed. 975, 42 Sup. Ct. 570), the United States Supreme Court, upon similar reasoning held that labor unions were suable in tort. It was held that the Sherman Anti-Trust Law (26 Stat. 209) and other federal statutes impliedly changed the common-law rule of the nonsuability of such associations. This decision, of course, is binding upon the federal courts only, and it depends entirely upon the Sherman Act and ' other legislation.”

That the ruling of the Coronado case does not affect the statutes of this State, see opinion of L. Hand, J., in United States & Cuban Allied Works Engineering Corp. v. Lloyds (291 Fed. Rep. 889, 891, 892), where the court said, referring to Coronado case:

“ The decision did not effect a general change in the status of such associations; rather, it turned upon the character of a trade union as such, especially because of its repeated recognition in statutes of the United States as an entity. It is to be read as applicable only to such cases.”

Moreover we have specifically provided for such an action against an unincorporated association in section 13 of General Associations Law.

The judgment of the Appellate Division dismissing the second to seventeenth causes of action should be reversed and the motion to dismiss such causes of action denied, with costs in this court and in the Appellate Division.

The order of the Appellate Division in so far as it affirms orders of the Special Term denying the motion to dismiss the first cause of action should be reversed and the motion granted, with costs in all courts. The first question certified should be answered in the negative. The second question certified need not be answered.

Lehman, Ch. J., Loughran, Finch, Rippey and Lewis, JJ., concur with Desmond, J.; Conway, J., dissents in opinion as to action No. 1.

Judgment accordingly.


author: Conway, J.

text:
    The People of the State of New York, Respondent, v. William Esposito and Anthony Esposito, Appellants.

      Argued November 27, 1941;
    decided January 22, 1942.

      Francis L. Valente, Irving J. Tell and Morris Dickman for appellants.
    The defendants were compelled to stand trial without proper preliminary inquiry as to their sanity and as to their ability to understand the proceedings and make their defense. (Freeman v. People, 4 Den. 9; People v. McElvaine, 125 N. Y. 596; Youtsey v. United States, 97 Fed. Rep. 937; United States v. Chisholm, 149 Fed. Rep. 284; People v. Bogdanoff, 254 N. Y. 16; People v. Glen, 173 N. Y. 395; Simon v. Craft, 182 U. S. 427; People ex rel. Barone v. Fox, 144 App. Div. 611; 202 N. Y. 616; Stuart v. Palmer, 74 N. Y. 183; Rosalsky v. State, 254 N. Y. 117.) The defendants’ constitutional immunities were violated by their injection with narcotic and paralyzing drugs and by the opinion evidence furnished by the People’s expert being based in part on the reactions of the defendants while subject to the drugs and information obtained from them while under the influence thereof. (Matter of Doyle, 257 N. Y. 244; Matter of Grae, 282 N. Y. 428; People v. Truck, 170, N. Y. 203; People v. Nino, 149 N. Y. 317; People v. Furlong, 187 N. Y. 198; People v. Austin, 199 N. Y. 446; People v. Kemmler, 119 N. Y. 580; People v. Sliney, 137 N. Y. 570; People v. Hoch, 150 N. Y. 291.)

      Thomas E. Dewey, District Attorney (Stanley H. Fuld, Joseph A. Sarafite and Eugene A. Leiman of counsel), for respondent.
    The defendants’ mental responsibility and guilt were established beyond a reasonable doubt. (People v. McElvaine, 125 N. Y. 596.) There was ample proof that the defendants were capable of understanding the proceedings and of making their defense. (People v. McElvaine, 125 N. Y. 596; People v. Rhinelander, 2 N. Y. Cr. Rep. 335; Freeman v. People, 4 Den. 24; People v. Hoch, 150 N. Y. 291.) The procedure adopted by the court for determining the question of sanity at the time of the trial was proper; the defendants were not deprived of due process or prejudiced in any way. (People v. Tobin, 176 N. Y. 278; People v. McElvaine, 125 N. Y. 596; Freeman v. People, 4 Den. 9; People v. Rhinelander, 2 N. Y. Cr. Rep. 335;
      United States v. Harriman, 4 Fed. Supp. 186; People v. Pershaec, 172 Misc. Rep. 324; People v. Whitman, 149 Misc. Rep. 159; People v. Goldstein, 285 N. Y. 376; Nobles v. Georgia, 168 U. S. 398.) There was no violation of the defendants’ constitutional privilege against self-incrimination. (People v. Defore, 242 N. Y. 13; People v. Gardner, 144 N. Y. 119; People ex rel. Taylor v. Forbes, 143 N. Y. 219; People v. Furlong, 187 N. Y. 198; State v. Nelson, 162 Ore. 430; State v. Coleman, 96 W. Va. 544; Johnson v. Comm., 115 Penn. St. 369.)
   Conway, J.

The defendants were convicted of murder in the first degree, and sentenced to be executed, after a trial in the Court of General Sessions in New York County. They had pleaded not guilty with a specification of insanity pursuant to section 336 of the Code of Criminal Procedure, and it was contended on their behalf that they were legally insane at the time of the commission of the crime and at the time of arraignment and trial.

On the 14th day of January, 1941, Alfred Kláusman, the deceased, was employed at No. 6 East Thirty-fourth street, Manhattan, New York city, and on that day collected his employer’s payroll from a local bank. He returned with it to his place of employment and signaled for the elevator. He entered it, followed by the defendants. Those three and the operator were the sole occupants. As the elevator was ascending, and between the second and third floors, Klausman refused to accede to the request of the defendants that he yield possession of the payroll money. He was shot through the head and the money taken from him. He died. The operator was then ordered to return to the street floor where the defendants left the elevator after ordering the operator to ascend with the car. •" ■,

The defendants entered Thirty-fourth street. An employee of a firm on the second floor in the building shouted an alarm from a window facing Thirty-fourth street. The defendants ran across that street and entered a department store, pursued by police officers, store employees and civilians. They emerged on another street and entered a taxicab which was unable to progress because of blocked traffic. They then left the taxicab and ran around a corner into Thirty-fifth street, closely pursued by police and civilians. They exchanged shots with the police and the defendant William Esposito was shot down. The defendant Anthony Esposito was captured. The policeman guarding William was killed by him by means of a revolver concealed on his person and a bystander who attempted to aid the police was also shot by William. The defendants were armed with six guns. They also possessed a length of rope, a knife and additional ammunition.

The facts clearly sustained the finding of the jury that the defendants were not legally insane at the time of the commission of the crime. In fact, appellants’ brief states that the appeal is “ directed primarily to questions of law rather than questions of fact” and counsel stated to the jury: “We concede everything, but we say that they are insane.”

Two claimed errors require consideration. The defendant Anthony Esposito moved for the granting of an order “ pursuant to the provisions of Chapter Y of the Code of Criminal Procedure as amended by the laws of 1939 [ch. 861], directing that the said defendant be examined to determine the question of his sanity; ” and for other and further relief. Both defendants later moved for the granting of an order permitting the employment of two psychiatrists to testify on their behalf at the expense of the county. On the argument of the latter motion the court pointed out that under the provisions of section 308 of the Code of Criminal Procedure it was necessary for the defendants to submit some evidence showing the necessity for the appointment of psychiatrists. Following the making of each motion an order was entered. The orders were identical in form. Each provided for commitment “for a reasonable period for treatment, observation, examination and report * *

The Court of General Sessions has inaugurated the practice, in the discretion of the judge in the particular case, of entering an order for treatment, observation and examination of an indicted defendant and of obtaining a report thereon for the purpose of determining preliminarily whether there is reasonable ground for believing that such defendant is in such state of idiocy, imbecility or insanity that he is incapable of understanding the charge, indictment or proceedings or of making his defense,” under section 658 of the Code of Criminal Procedure and section 1120 of the Penal Law. If that preliminary order and the examination and observation thereunder results in a report which satisfies the court that the defendant should be examined to determine the question of his sanity, an order is entered for the formal examination provided for in sections 658-660 of the Code of Criminal Procedure. That latter order directs that the defendant be formally examined in accordance with the provisions of the Code * * * to determine the question of his sanity, * * (See People v. Pershaec, 172 Misc. Rep. 324, 338.)

Regardless of the specific purposes outlined in the papers submitted upon the motions made, both sets of motion papers were based upon alleged insanity and it was, therefore, clearly within the discretion of the court to commit the defendants for examination and observation prior to the entry of an order which would set in motion a statutory proceeding under sections 658 et seq. of the Code of Criminal Procedure. When the report of the examination and observation disclosed that the defendants were sane but were malingering, the trial court was justified in finding that there was no “ reasonable ground for believing ” the defendants’ assertions of insanity and in ordering them to proceed to trial. Thus no order provided for under sections 658 et seq. of the Code of Criminal Procedure was made.

The question then arises whether the court was free to select the method employed in order to determine the question of defendants’ insanity at the time of arraignment and trial. Section 1120 of the Penal Law provides: “ * * * A person can not be tried, sentenced to any punishment or punished for a crime while he is in a state of idiocy, imbecility, lunacy or insanity so as to be incapable of understanding the proceeding or making his defense. * * * ” The defendants claim that they were entitled to representation and to call witnesses upon the examination and observation ordered and to contest the report thereon. In this we think the defendants are in error. This court, speaking through Chief Judge Huger upon this subject in People v. McElvame (125 N. Y. 596, 608), said: We do not think the Code of Criminal Procedure has made any radical change in the mode of procedure or the character of the proceedings. The duty of making the examination referred to is now imposed upon the court before whom the indictment is pending, and it would be responsible for any violation of the law in respect to trying or punishing insane criminals permitted by it. It is only when the necessity of such an examination is sufficiently made to appear to the court in which the indictment is pending, that it is bound to order an examination; but it would be the plain duty of a court, when the subject is brought to its attention by responsible parties, to itself make a sufficient inspection and examination to determine whether the application is made in good faith and upon plausible grounds, and the apparent facts thus discovered are made the condition of the right of the court to institute the statutory inquisition. Such an examination, we infer, the court made in this case. ■ * * * We think the motion rested in the discretion of the court, and it was justified in denying it. It is certainly a startling proposition to think that a prisoner can, at his pleasure, arrest the regular and orderly administration of criminal law by raising collateral issues indefinitely, and thus delay, and, perhaps, defeat a trial under an indictment. The law has made ample provision for the protection of all a prisoner’s rights, but it does not put it in his power to paralyze the administration of justice. The question of his sanity at the time of the commission of the offense is always open for trial under a plea of not guilty, and we have referred to the provisions which protect him from trial, conviction or punishment if he becomes insane while in confinement. So far from having a right to compel an examination into the question of present insanity, he is permitted to take part in such examination, if ordered, only by the express provision of the statute. It is plainly inferable from this permission that it was supposed without it the examination must be conducted by the officers charged with the duty of making it alone.”

To the same effect are People v. Tobin (176 N. Y. 278, 284); Freeman v. People (4 Den. 9, 20); People v. Rhinelander (2 N. Y. Crim. Rep. 335). (See, also, United States v. Harriman, 4 Fed. Supp. 186, 187.)

It is true that defendants were not permitted to take part by representation of counsel during the examination and observation directed and that they were not afforded an opportunity to contest the findings of the examiners upon that examination and observation. Where sanity is found, however, even under a proceeding under sections 658 et seq. of the Code of Criminal Procedure, the defendants have ample opportunity to furnish the court with evidence bearing upon their then mental condition at any time before final judgment, and of course that right continues under section 1120 of the Penal Law and sections 495a-499 of the Code of Criminal Procedure, following a preliminary examination, observation and report under the procedure employed here. Moreover, on the trial the defendants were entitled to show their then mental condition in order that such condition might be considered by the jury as evidencing their mental condition at the time of the commission of the crime charged. Defendants’ three sisters, their two lawyers and two psychiatrists, called in their behalf, testified ■ to their mental condition while in the Tombs awaiting trial. The trial court advised the jury that proof of insanity following the commission of the crime was relevant as bearing upon the issue of insanity at the time of the commission of the crime.

That advice was proper and in accord with settled legal principles. (People v. Hoch, 150 N. Y. 291, 303, 304.) One of the psychiatrists called by the defendants acknowledged on cross-examination that he could not say ” that they were now suffering from a psychosis.”

The other question presented is the assertion of defendants that their constitutional immunities were violated (1) by their injection with narcotic and paralyzing drugs during the examination and observation of them at Bellevue Hospital; and (2) by the receipt during the trial of evidence furnished by one of the psychiatrists who testified on behalf of the People in so far as it was based on the reactions of the defendants while subject to the drugs and on information obtained from them while under drug influence.

1. The drugs used were metrazol and sodium amytal. There was evidence that those drugs are frequently used in psychiatric examinations. We have reached the conclusion after due consideration that the injection of those drugs and the receipt of the testimony violated no rights of the defendants under the circumstances presented by this record. The drugs were administered for the purpose of removing defendants’ inhibitions because the doctors suspected that they were shamming and malingering. One doctor testified that the symptoms exhibited by the defendants did not fit into any pattern that you know of, any form of psychosis ” and that they [the defendants] are not showing any symptoms of- any known psychosis.” It must be remembered that the orders for the examination and observation were based upon the defendants’ claim that they should escape punishment by reason of their mental condition at the time of the commission of the acts charged or by reason of their condition at the time of arraignment and trial. Under those circumstances defendants may not both advance their claims and then seek to make the rules for the determination of those claims. Since they desired to present their claims that they were not legally responsible for their acts because of mental defect they were subject to the use of methods set up objectively by the medical profession for the proper determination of such claims. Courts, under the circumstances presented here, may not control the methods which have been determined by the medical profession to be proper means for discovering or treating mental diseases.

2. As to the claimed violation of constitutional immunity from self-crimination, we do not pass upon the question whether testimony of the examining and observing psychiatrists was admissible to establish a confession of guilt or admissions evidencing guilt while the defendants were subject to the influence of the drugs which had been administered to them. We are not now prepared in view of the record presented here and of present medical knowledge and experimentation disclosed therein, to hold that such testimony is competent. The questions asked in this instance were quite evidently for the purpose, among others, of determining whether the defendants were capable of understanding the proceedings and of making their defense. Neither confessions of guilt nor admissions evidencing guilt were elicited. There was, therefore, no error committed.

The judgments of conviction should be affirmed.

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

Judgments of conviction affirmed.


author: Per Curiam.

text:
    The People of the State of New York, Respondent, v. Joseph Nicolia, Appellant.
    Argued December 5, 1941;
    decided January 23, 1942.

      David A. White for appellant.
    Admission of testimony as to fire insurance on buildings not owned by defendant was error requiring reversal. (People v. Goldberg, 146 App. Div. 335; People v. Blatt, 136 App. Div. 717; People v. Bonier, 179 N. Y. 315.)

      John S. Marsh, District Attorney, for respondent.
   Per Curiam.

It was error to admit evidence of insurance policies owned by the defendant’s uncle covering both the house which was the subject of the fire and an adjoining house and the furniture therein, when there was no claim that there was any complicity on the uncle’s part in the crime charged against the defendant.

The judgments should be reversed and anew trial ordered.

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

Judgments reversed, etc.


author: Loughran, J.

text:
    In the Matter of Tanenbaum Textile Co., Inc., Respondent, against Hyman Schlanger, Trading under the Name of Miami Knitting Mills, Appellant.
    Argued January 8, 1942;
    decided March 5, 1942.

      Morton G. Rosenberg, Malcolm R. Lawrence, Jr., and Norton M. Levine for appellant.
    There is no written contract to arbitrate between the parties, as required by section 1449 of the Civil Practice Act. (Duncan v. Wohl, South & Co., 201 App. Div. 737; Altkrug v. Whitman Co., 185 App. Div. 744; Guillaume v. General Transportation Co., 100 N. Y. 491; Swift v. Pacific Mail S. S. Co., 106 N. Y. 206; Sturtevant v. Cumberland, Dugan & Co., 106 Md. 587; Pennington Grocery Co. v. Wood & Co., 97 Okla. 220; 1 Williston on Contracts, § 90 (c); Dale v. See, 51 N. J. L. 378; Dows v. National Exchange Bank, 91 U. S. 618; Tradesmen’s Nat. Bank v. National Surety Co., 169 N. Y. 563; Barker v. Bradley, 42 N. Y. 316; Matter of Amalgamated Association of Railroad Employees, 196 App. Div. 206.) Neither claimed custom of the trade nor alleged conduct of the parties is sufficient to meet the statutory requirement of a written contract to arbitrate. (Hart v. Cort, 165 App. Div. 583; Lawrence v. Maxwell, 53 N. Y. 19; Hopper v. Sage, 112 N. Y. 530.)

      Nat C. Helman and Leon A. Beeman for respondent.
    The agreement to arbitrate is valid and satisfies the provisions of sections 1448 and 1449 of the Civil Practice Act. (Matter of Japan Cotton Trading Co. v. Farber, 233 App. Div. 354; Matter of Exeter Mfg. Co. v. Marrus, 254 App. Div. 496; Matter of Marshall v. Fox Theatres Corp., 147 Misc. Rep. 4.) The evidence amply sustains the finding that an agreement exists between the parties providing for arbitration of disputes arising out of the sales. (Esterly v. Cole, 3 N. Y. 502; Newhall v. Appleton, 114 N. Y. 140; Walls v. Bailey, 49 N. Y. 464; Eighmie v. Taylor, 98 N. Y. 288; Thomas v. Scutt, 127 N. Y. 133; Newburger v. American Surety Co., 242 N. Y. 134.)
   Loughran, J.

During a period beginning on April 10 and ending on June 7, 1940, Tanenbaum Textile Co., Inc., a domestic corporation, on twenty several occasions sold and delivered a quantity of textiles to Hyman Schlanger, trading under the name Miami Knitting Mills. A controversy between them having subsequently arisen out of these transactions, the Tanenbaum Company demanded that it be settled by arbitration. Contrariwise Schlanger commenced an action in the Supreme Court for an adjudication of their differences. Thereupon the Tanenbaum Company moved for an order directing arbitration. By his answer, Schlanger denied the existence of a contract to arbitrate. This issue was tried before the court without a jury. Finding that “ a specific agreement exists between the parties to settle by arbitration all controversies arising from the sale of these goods,” the court ordered them to proceed to arbitration before a named tribunal and stayed the action commenced by Schlanger in the Supreme Court. From, an affirmance of this order by a divided vote of the Appellate Division, Schlanger has now appealed as of right to this court.

“A contract to arbitrate a controversy thereafter arising between the parties must be in writing.” (Civ. Prac. Act, § 1449.)

The president of the Tanenbaum Company was the only witness on the trial. Since a great deal turns on his undisputed testimony, we quote it: Q. You would get an order from Mr. Schlanger, either by telephone or personally on your visit and you would go back and ship that order to Mr. Schlanger? A. That is right. Q. Frame it in your own way. Tell us what took place. A. We simply typed the invoice up, sent it- to Mills Factors and they would check the amount in dollars and cents, and * * * put it in an envelope and mail it to the customer. Q. And that would be done after the goods were shipped to Mr. Schlanger? A. As a rule, yes. Q. You have had certain business dealings with Mills Factors Corporation, is that right? A. Yes, sir. Q. They are a banking concern? A. That is correct. Q. And each of these accounts had been assigned to the Mills Factors Corporation? A. That is right. Q. When payment is made by the customer, it is made direct to Mills Factors Corporation under your arrangement, is that right? A. That is right. Q. And when these items were not ■ paid, what happened to these accounts? A. The account is charged back to our account with Mills Factors. Q. And somebody at Mr. Schlanger’s place would receive those goods, is that correct? A. Yes, I believe so. Q. And you would get a receipt from Mr. Schlanger? A. That is true. Q. During all of the time that you took orders from Mr. Schlanger, personally or over the telephone, did you ever talk with him about arbitration on any specific invoice? A. No. I never speak to a customer about arbitration. It would be bad policy.”

The receipts which Schlanger gave on delivery of the goods to him were in a form which is illustrated by this exhibit: “‘Received from Tanenbaum Textile Co., Inc., 460 Fourth Avenue for Miami Ktg in good order the following: (3) Rolls.” Each of the invoices that were sent to Schlanger on behalf of the Tanenbaum Company by Mills Factors Corporation restates the individual transaction in a form of which the following is a specimen: “ Sold to Miami Knitting Mills 6 West 18th St. N. Y. C. Style C 22 Jersey White 31 lbs. Aqua 19-6. Pink 27-8-77 7 /8 lbs @ .62 per pound 48.29.”

On each invoice there had been stamped in red ink the words: “All controversies arising from the sale of these goods are to be settled by arbitration.” Schlanger retained all the invoices. Cryptic entries made thereon are enough to indicate that cross-entries were made in his books.

The foregoing, we believe, is a full and accurate statement of the facts. The reason for the decision made below is phrased as follows: “ The courts have frequently held that a party by receiving and retaining, without objection, under certain circumstances, a written contract signed by the other party, may be held bound by the terms of such writing, though he himself has not signed. * * * The invoices included all the terms of the completed contracts. They completely evidenced the agreements which were fully consummated by the parties, except for compliance with the provision concerning arbitration.” We take another view.

It is true that acceptance of a document which plainly purports to be a contract gives rise to an implication of assent to its terms despite ignorance of the content thereof. (Murray v. Cunard Steamship Co., 235 N. Y. 162; 1 Williston on The Law of Contracts [Rev. ed.], §§ 90A, 90B.) But that is not this case. An invoice, as such, is no contract. An invoice is a mere detailed statement of the nature, quantity and the cost or price of the things invoiced. (Sturm v. Baker, 150 U. S. 312, 328, 340, 341; 17 Am. & Eng. Ency. of Law [2d-ed.], pp. 478, 479.)

Each of the transactions in question was executed in accordance with an agreement that had been made without mention by either party of the subject of arbitration. It was not until that stage had been reached in each instance that the invoice was made out and stamped with the words All controversies arising from the sale of these goods are to be settled by arbitration.” The whole question is thus one of the effect of Schlanger’s silence in the face of such separate offers for arbitration, each of which looked back to a single sale and delivery theretofore made.

The applicable principles have been stated by this court in this manner: A party cannot be held to contract where there is no assent. Silence operates as an assent and creates an estoppel only when it has the effect to mislead * * * When a party is under a duty to speak, or when his failure to speak is inconsistent with honest dealings and misleads another, then his silence may be deemed to be acquiescence. * * * And it may be added that a person is under no obligation to do or say anything concerning a proposition which he does not choose to accept. * * * There must be actual acceptance, or there is no contract.” (More v. New York Bowery Fire Ins. Co., 130 N. Y. 537, 545, 547. See the cases collected in 77 A. L. R. pp. 1141-1153. Cf. National Union Fire Ins. Co. v. Ehrlich, 122 Misc. Rep. 682.) Tested by these standards, the cáse for the Tanenbaum Company, in our judgment, fails to meet either letter or spirit of the explicit command of the statute that, “A contract to arbitrate a controversy thereafter arising between the parties must be in writing.”

The orders should be reversed and the proceeding dismissed, with costs to the appellant in this court and in the Appellate Division.

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

Orders reversed, etc.


author: Finch, J.

text:
    Benjamin W. Cohen, Appellant, v. Charles A. Dana et al., Defendants, and Karl H. Behr et al., Respondents
    Argued January 5, 1942;
    decided March 5, 1942.

      Jacob Lippman, Martin Lippman and William M. Smith for appellant.
    A complaint should not be dismissed for non-joinder of a party defendant. (McKnight v. Bank of New York & Trust Co., 254 N. Y. 417; Spaulding v. First Nat. Bank, 210 App. Div. 216; 239 N. Y. 586; New Amsterdam Casualty Co. v. Mobinco Brokerage Co., 219 App. Div. 486.) There is no evidence that our courts cannot obtain jurisdiction of the Fisk Rubber Corporation. (35 Columbia Law Review, pp. 793, 794; 44 Yale Law Journal, p. 1091; Keene v. Chambers, 271 N. Y. 326.)

      Paul H. Arthur, Paul W. Williams and Horace C. Hitchcock for respondents.
    The plaintiff having sworn that he will be unable to bring the corporate defendant before the court, the complaint was properly dismissed. Jurisdiction of a cause will not be retained, and the complaint will be dismissed, if a complete determination of the controversy is impossible because of inability to bring an indispensable party before the court. (Mahr v. Norwich Union Fire Ins. Co., 127 N. Y. 452; Osterhoudt v. Board of Supervisors, 98 N. Y. 239; Minnesota v. Northern Securities Co., 184 U. S. 199; Whalen v. General Mining, Milling & Power Co., 249 App. Div. 601; Philipbar v. Derby, 85 Fed. Rep. [2d] 27; Hyams v. Old Dominion Co., 209 Fed. Rep. 808; Lawrence v. Southern Pacific Co., 180 Fed. Rep. 822; 228 U. S. 137; First Nat. Bank v. Shuler, 153 N. Y. 163.)
   Finch, J.

Appeal is taken to this court by plaintiff from a judgment dismissing the complaint entered upon the order of the Appellate Division.

As the complaint has been dismissed before answer, we are compelled to take the allegations as if proven true. The complaint alleges that the action is brought for the benefit and in the right of said The Fisk Rubber Corporation and for the benefit and in the right of all stockholders of the common stock of the Fisk Rubber Corporation ” (hereinafter called Fisk) against the directors of that corporation and certain other third parties, all of whom it is alleged entered into an illegal scheme and conspiracy among themselves to transfer by means of misrepresentation and concealment the assets of Fisk to the defendant United States Rubber Company at a price grossly below the true value of said assets, to the great damage of the corporation and its stockholders. Thereafter the defendants caused Fisk to be dissolved and all of its’ assets distributed. The complaint further alleges that Fisk was a foreign corporation organized in Delaware and engaged in business in Massachusetts until its dissolution in March, 1940. The individual defendants, except defendant Georgeson, were the directors of Fisk. Defendant United States Rubber Company is a foreign corporation of New Jersey and has a principal place of business in the city of New York. Defendant Dillon, Read & Company is a domestic corporation and defendant Behr its vice-president. Among the chief assets of Fisk were letters patent covering inventions establishing the cord tire fabric. These inventions were and are of great value, and of ever increasing value.' Through successful prosecution of patent litigation conducted by Fisk, it became entitled to receive from all infringers, including the rubber company, large sums of money by way of damages, profits and royalties, with the continuing right to receive such royalties from users of the patents. Fisk brought an action against the General Tire Corporation for infringement, which finally established the validity of the patents in the courts of the United States. The illegal scheme and conspiracy was conceived and carried through by these defendants for the purpose of acquiring the advantage and gain of these patents for the rubber company and to the damage of Fisk. To carry out this illegal conspiracy the directors approved and recommended to the stockholders the sale of all the assets of Fisk to the rubber company at a price based upon the book value of the assets of Fisk allowing one dollar for the value of these inventions and on this basis the defendants caused an agreement to be made between Fisk and the rubber company in December, 1939, whereby Fisk agreed to sell and the rubber company agreed to buy all the assets of Fisk including the patents. The agreement provided that the contract would be closed following the approval of the sale by a majority of the stockholders. The rubber company agreed to pay approximately $6,000,000 plus 109,000 shares of the common stock of the rubber company, making the total price paid for the property of Fisk approximately $11,000,000. According to the consolidated balance sheet prepared by the accountants of Fisk, the net worth of Fisk and its subsidiary companies was approximately $13,000,000 without any value for the good will or patents except the sum of one dollar. The patents were worth upwards of $5,000,000, making the total value of the assets of Fisk upwards of $18,000,000 for which the rubber company paid approximately $11,000,000. In order to carry out the conspiracy, the defendants engaged the defendant Georgeson to hire assistants and solicit proxies, it being agreed among the defendants that they would misrepresent and conceal from the stockholders of Fisk the true value of the assets of Fisk and the value of the common stock by concealing the value of the patents. By this misrepresentation and concealment a majority of the stockholders of Fisk approved the sale. At the time of the sale, the present business and the prospect for future business of Fisk were the greatest in the history of the corporation, the earnings and profits derived therefrom being for the year 1939 more than three times that of the preceding year. As a part of this conspiracy the defendant director Speaks received the sum of $100,000, and defendant Behr the sum of $50,000 for the benefit of Dillon, Read & Company. Defendants Speaks and Behr dominated and controlled the other members of the board of directors, and succeeded in bringing about the making of the contract and consummation of the objects of the conspiracy even though both of said directors abstained from voting. The director Dennett, through a pecuniary interest inconsistent with his position of director, profited in excess of $100,000. Through this conspiracy Fisk was damaged in a sum exceeding $5,000,000, and the defendants made personal profits in excess of $5,000,000. The plaintiff asks no relief against Fisk.

Plaintiff prays for a decree directing the defendants to account and that the court appoint a receiver or such other officer as it may deem proper to receive and distribute any recovery for the benefit of Fisk and its common stockholders.

Since the defendants, instead of answering on the merits, have moved the court to direct plaintiff to bring in Fisk as a party defendant, all the allegations of the complaint must be taken as admitted for the purposes of the motion.

In moving to have the court direct plaintiff to bring in Fisk as a.necessary party, the defendants admit the dissolution of Fisk in Delaware in March, 1940, and that all of its assets have been distributed and all its directors have either resigned or ceased to be directors, but set up the Delaware statute (Delaware Corporation Law, § 42) continuing dissolved corporations for a period of three years as bodies corporate for the purpose of prosecuting and defending suits by or against them, and of enabling them gradually to settle and close their business, to dispose of and convey their property and to divide their capital stock *' * In opposition to the motion plaintiff by affidavit alleges that while Fisk was in business it never was licensed to do business in New York but did business solely in the state of Massachusetts, and that since its dissolution Fisk has not engaged in business anywhere and has no tangible assets and that if plaintiff is compelled to serve Fisk with process in this state the action cannot be prosecuted. Moreover, as Fisk cannot be served with process in the State of New York, and none of the defendants can be served with process in the state of Delaware, it follows that if plaintiff is required to make Fisk a party defendant and serve process upon Fisk in the State of New York, the allegations of this complaint will stand admitted as true, and yet be determined without answer and without trial. Plaintiff further shows that written request on his part has been made of the defendant directors who have been served with process in this action, that they cause Fisk to appear voluntarily herein as a party defendant, offering to consent to have Fisk made a party defendant in accordanee with the relief demanded in the motion of defendants. This motion of defendants to compel plaintiff to make Fisk a party was denied at Special Term. Following the denial of this motion defendants moved to dismiss the complaint on the ground that the plaintiff concedes that the court cannot obtain jurisdiction of a party indispensable to the action. Special Term likewise denied this second motion. On appeal from both orders the Appellate Division unanimously reversed and dismissed the complaint saying in an opinion that although Fisk had been dissolved yet under the law of Delaware the corporation continues in existence for three years for the purpose of prosecuting and defending suits,” and that “ this practical disposition [a dismissal of the complaint] is made in view of the concession that service cannot be had upon the Fisk Rubber Corporation in this jurisdiction.” (262 App. Div. 42, 44.) The appeal from the order to cause Fisk to be made a party was dismissed as academic.

Without passing on whether Fisk is a necessary and indispensable party to this litigation, the complaint should not have been dismissed. The concession which was the basis of the decision of the Appellate Division was not sufficiently broad to justify the result arrived at. All that the plaintiff conceded was based upon the statement that Fisk cannot be served with process in this State.” The inability of plaintiff to serve process upon Fisk within this state does not exclude the possibility of the joinder of Fisk as a party. The plaintiff urges that under the circumstances of this case the court in Delaware may be petitioned to direct Fisk to enter an appearance in the suit against the directors so as to satisfy the procedural requirements of joinder and not permit these serious charges to go unanswered and untried. If the court at the domicile of the corporation did not order such an appearance, nevertheless it might appoint a receiver with authority to prosecute the action or grant such other relief as might be just and proper. The plaintiff should have been given a full opportunity either to bring in Fisk as a party defendant or to have an adjudication duly made by the court at its domicile, or thereafter to show in this action that under the circumstances in the case at bar Fisk was not an indispensable party to this action. At that time it may become necessary to consider also to what extent the statutory direction is applicable that no action shall be defeated by the non-joinder of parties. (Civil Practice Act, § 192.)

It follows that the judgment of the Appellate Division dismissing the complaint should be reversed and the order of the Special Term denying the motion to dismiss the complaint affirmed, with costs in this court and in the Appellate Division.

Lehman, Ch. J., Loltghran, Rippey, Lewis and Desmond, JJ., concur; Conway, J., taking no part.

Judgment accordingly.