author: Loughran, J. Lehman, Ch. J. Finch, J.

text:
    In the Matter of Rosario Chirillo et al., Appellants. Ruth Taylor, as Commissioner of Public Welfare of Westchester County, Respondent.

      Argued April 10, 1940;
    decided July 24, 1940.

      Morris Shapiro, Harry Katz and Samuel Slaff for appellants.

      Osmond K. Fraenkel for American Civil Liberties Union, amicus curiæ.

      Elliott L. Biskind and Louis Eisenstein for New York City Chapter of National Lawyers Guild, amicus curiæ.

      William A. Davidson, County Attorney (Henry Epstein and Umberto D’Alessandro of counsel), for respondent.

      John J. Bennett, Jr., Attorney-General (Henry Epstein, John F. X. McGohey and Nathaniel Fensterstock of counsel), for State of New York.

      William C. Chanler, Corporation Counsel, for City of New York, amicus curiæ.

   Loughran, J.

In 1926 Rosario Chirillo became a citizen of the United States by naturalization. He lived thereafter at Wooster, Ohio, until January, 1939, when he removed with his wife and minor children to the town of Mamaroneck, Westchester county, New York. Beginning in September, 1939, the family received public relief from the Commissioner of Public Welfare of Westchester County in installments amounting altogether to $116.60.

Upon a petition of the Commissioner, the County Court of the county on February 19,1940, made an order as follows:

Ordered, that the respondents, Rosario Chirillo and Josephine Chirillo, his wife, together with the minor children of said Rosario Chirillo and Josephine Chirillo, namely: Louis Chirillo, Mary Chirillo, Joseph Chirillo and Joseph Calabre, leave the State of New York within twenty (20) days after the service upon said Rosario Chirillo and Josephine Chirillo, his wife, individually and as parents and natural guardians of the aforesaid minor children, and on each of the said minor children, Louis Chirillo, Mary Chirillo, Joseph Chirillo and Joseph Calabre, of a certified copy of this order; and it is further
Ordered, that upon the failure of said respondents to leave the State of New York as hereinabove provided, the Sheriff of Westchester County be and he hereby is ordered and directed to remove the said respondents herein, namely: Rosario Chirillo and Josephine Chirillo, his wife, and the minor children, Louis Chirillo, Mary Chirillo, Joseph Chirillo and Joseph Calabre, from their present residence in the Town of Mamaroneck, Westchester County, New York, to the City of Wooster, County of Wayne, State of Ohio.”

This order was made in professed exercise of the jurisdiction conferred by section 71 of the Public Welfare Law (Cons. Laws, ch. 42) which reads as follows:

Removal of non-resident and alien poor to other states and countries. When any person who is an inmate of any public home or is otherwise cared for at the expense of the state or of any public welfare district belongs to or has friends willing to support him or to aid in supporting him in any other state or country, the state department of social welfare may cause his removal to such state or country, provided, in the judgment of the state department of social welfare, the interest of the state and the welfare of such person will be thereby promoted. After notification of the proposed removal, if such person shall refuse to be so removed, the commissioner of the public welfare district wherein such person is being cared for may, with the prior approval of the state department, apply to the county judge of his county for the issuance of an order to the sheriff of the county in which such person is being cared for, or to some other person or persons, to remove the person to the state or country or district therein legally responsible for or willing to support him, and cause his removal thereto. The expense of such removal shall be paid from the state treasury on the warrant of the comptroller pursuant to a verified account submitted by the proper officer of the state department of social welfare.”

Contending that the provisions of section 71 of the Public Welfare Law violate the Federal Constitution, the Chirillo family have as of right appealed from the order of removal of the County Court of Westchester County directly to this court as in a case “ where the only question involved on the appeal is the validity of a statutory provision of the state or of the United States under the constitution of the state or of the United States.” (N. Y. Const. art. VI, § 7, subd. 3; Civ. Prac. Act, § 588, subd. 3.)

What is meant by section 71 of the Public Welfare Law when it speaks of a person who belongs to * * * any other state or country? ” The answer of the court below was that a person “ belongs to ” that State or country where he has the right to have his need relieved under poor laws. The court found that the appellants had their poor law settlement at Wooster, Ohio — where, as the court also found, the relief authorities were willing to support the appellants on their return. Likewise the court was of opinion that the phrase non-resident poor,” as used in section 71, means indigent persons who have not gained a settlement in a town or city of this State by continuous residence for one year without receiving certain types of public relief or care. (See Public Welfare Law, art. VII, particularly, § 56.)

This construction of section 71 is denied by the appellants. It is argued for them that “ residence ” has here its ordinary legal meaning (i. e., domicile), and that consequently they must be taken to be residents of Westchester county, New York. Questions of the intent and scope of the statute are thus major issues.

Amici curios attack section 71 with the claim that it attempts to direct the compulsory removal of any indigent person from this State to any other place where he has friends willing to support him or to aid in supporting him.” It may be, however, that section 71 will bear the restrictive interpretation that the consent of an indigent person is essential to his deliverance to such chance kindred,— if indeed the section must necessarily stand or fall in its entirety.

The foregoing plainly shows that this case is not one “ where the only question involved on the appeal is the validity of a statutory provision of the state or of the United States under the constitution of the state or of the United States.” I am aware that there are cases in which this court on a direct appeal has determined the constitutional validity of a statute upon the basis of a construction thereof made by a court of first instance with the assent of all parties to the controversy. (Cf. Doubleday, Doran & Co. v. Macy & Co., 269 N. Y. 272.) In respect of that edge of our jurisdiction, it seems to me to be enough to say that such a case is not now before us.

The appeal should be dismissed, without costs.

Lehman, Ch. J.

(concurring). I concur in the opinion of Loughran, J.

In litigation between private parties, the litigants may ordinarily agree upon the construction of a statute on which a claim of a private right or obligation is based, and either party may confine attack or defense to a challenge of the validity of the statute under the Constitution of the United States or the Constitution of the State of New York. -When, in such litigation, a party aggrieved by a decision of a court of record of original jurisdiction, appeals directly to this court in accordance with the provisions of subdivision 3 of section 588 of the Civil Practice Act, he cannot assert that the decision is erroneous on any ground except the ground that the court has erred in giving or denying effect to a statute which has been challenged as unconstitutional. Since the court may not review any other question upon such appeal and the appellant may not urge any other question, the court must assume that in terms the statute defines the rights and obligations of the parties in the situation presented and it must accept a construction of the statute upon which the parties have agreed. (Doubleday, Doran & Co. v. Macy & Co., 269 N. Y. 272.) If, then, only the constitutional question remains and that question is decisive, the court must entertain the appeal not as matter of discretion but because the appellant may, under the provisions of the statute, appeal “as of right;” if any other question remains which might be decisive, the court must dismiss the appeal for the mandate may not be disregarded that “ on any such appeal only the constitutional question shall be considered and determined by the court.” (N. Y. Const, art. VI, § 7, subd. 3.)

The order of the court of original jurisdiction from which this appeal was taken, is not made in a litigation between private parties and concerns much more than the rights and obligations of private parties. Here officers of the State and county assert a power to remove to another State persons who claim that they are residents of this State and who challenge the power of these officers to compel their removal. The order which we are asked to review directs removal and rejects the claim of the appellants that removal violates rights guaranteed by the Constitution of the United States and the Constitution of the State. The public must look to the courts for the vindication of the rights of the individual guaranteed by law and the vindication of governmental powers exercised according to law for the promotion of the public welfare. The courts must define the limits of the powers of a public officer and the rights of the individual and in a dispute about these limits the public may have an interest transcending the interest of the parties to the dispute.

The powers of public officers are conferred by statute but no statute can confer upon a public officer a power which under the Constitution of the United States is denied to the State itself, or which -under the Constitution of this State may not be conferred by the Legislature upon an officer of the State. Consent may at times bar an individual from asserting thereafter a right to redress for wrong done by a public officer but no consent or stipulation, either express or implied, can enlarge or restrict the powers of an officer which are defined by law, just as no consent or stipulation can compel or justify sanction by a court of an act of a public officer prohibited by the Constitution. Here the court has directed the removal of the appellants and certainly no court may order such removal if, under a proper construction of the statute, no power of removal is conferred, even though the parties may agree in placing a broader construction upon the statute. In litigation involving only private rights, the parties may usually define the issues of law or fact which they desire to submit to the court; and even make the rules which shall be the measure of their reciprocal rights and obligations; in a proceeding brought to remove these appellants, the court had no power to grant an order to the Sheriff to remove the appellants unless such an order was authorized by the law and no limitation of the issues by consent of the parties or agreement of the parties can give to the court power to order the Sheriff to do an act without authority of law, nor may this court affirm an order of a court of first instance which directs a Sheriff to perform an act not authorized by law.

These are fundamental principles which have always governed courts in their control or review of acts of State officers. These principles dictate the conclusion that upon this appeal more than the validity of a statutory provision ” is involved. What we have said and decided in appeals from judgments involving only the relations of private parties, like Doubleday, Doran & Co. v. Macy & Co. (supra) have no application here. The draftsmanship of the statute is imperfect. Under a construction, which may, at least, be argued, the statute would not apply to these appellants and even if we should find that the Legislature has power to provide for the removal of persons in the situation of these appellants, we still could not affirm an order directing . the Sheriff to remove these appellants unless we considered the construction of the statute and determined that the statute was intended to authorize such removal.

Moreover, we cannot properly determine the validity of the statute under the Constitution if we confine our consideration to the clauses which might apply to the “ removal of a class of persons situated as are these appellants.” While it is true these appellants may not complain that other clauses deprive another class of persons of rights guaranteed by the Constitution, yet the entire statute might be rendered unconstitutional if excision of clauses which are void would go so deep that the intended purpose of the statute would be frustrated. Whether these clauses would be unconstitutional and how far excision of the void would destroy the intended purpose of the statute might again depend largely upon construction of statutory language and we cannot consider any question of construction upon this appeal.

For these reasons the appeal should be dismissed, without costs.

Finch, J.

(dissenting). It is submitted that we should consider and decide the constitutional question.

This is a direct appeal from an order of Special Term of the Westchester County Court, directing the removal, at State expense, of appellants from Westchester county, in this State, to Wooster, Ohio, their legal residence, upon the ground that the statute under which these proceedings were commenced (Public Welfare Law, § 71) js in violation of the Constitution of the United States.

This special proceeding was started in the interest of the public welfare on the petition of the Commissioner of Public Welfare of Westchester County.

The following facts are taken from the record: Rosario Chirillo “ is 62 years old and has complained of and requested medical aid for his rheumatic condition.” His wife, who is 56, also “ mentions poor health, particularly attacks of gallstones in the past, feeling too ill to be working, and chronic bronchitis.” One son, “ Louis, shows serious symptoms of mental difficulty ” and will need “ permanent support.” His brother “ Anthony, is at present in Maslin State Hospital in Ohio ” because of a psychiatric difficulty.

In October, 1926, Rosario became a citizen of the United States by naturalization at Wooster, Ohio. All his children were bom there, and through his trade as a cobbler he has acquired two parcels of real property. Furthermore, in Wooster, at various times, appellants have been recipients of public benefaction. In January, 1939, Chirillo sold all his belongings in Wooster except his realty, and moved to the town of Mamaroneck, Westchester county, in this State, claiming that he wished to establish a permanent home there. Rosario Chirillo insists that his purpose in moving from the State of Ohio to the State of New York was to be near a married son and a married daughter living in Mamaroneck. Upon arrival, Rosario Chirillo resumed his trade, but by September of the same year applied for relief to the local relief office. Four monthly payments were made to him, and these removal proceedings were commenced. In answer to an inquiry from the Westchester County Department of Family and Child Welfare, the authorities in Ohio wrote as follows on November 10, 1939: The above family has misstated the facts. They are residents of Wooster, Ohio. We authorize their return at your expense, although if I were in your place, I would refuse relief and tell them, if they want to get back to Ohio, they will have to pay their own way. There was no valid reason for their going out there. He had a small shoe repair business here and during the slack seasons we did grant a small amount of relief. He owns more property than he has told you about.”

On the basis of the above letter, plus the investigation by the Westchester County Welfare Department, and its own investigation, the State Department of Social Welfare gave its approval to these removal proceedings, and found in part as follows: They own property in Ohio and have previously received assistance there. The Ohio officials have authorized the return of the family and there is every reason to believe they will make a better adjustment there than here. Mr. Chirillo was able to obtain work on a seasonal basis in Ohio and his possibilities would seem to be better there. * * * This office is definitely of the opinion that this family should be returned to its place of legal settlement * * *.”

“ From their married children in Mamaroneck, New York, Mrs. Carmela di Orio, 827 Underhill Avenue, Mamaroneck, and John Chirillo, same address, they can expect no material help, since the former has four children and is the wife of a man employed at $4.00 a day by the Town of Mamaroneck, and the latter, formerly on W. P. A., is now receiving relief.”

i - The County Court found that appellants did not question the fact that their legal settlement was in Wooster. The court also found that the authorities there acknowledged responsibility for the family and consented to their return, and that appellants’ showing of income was only temporary, and a denial of the order might result in a loss of their legal settlement in Ohio. In consequence the court granted the application for removal, except as to a daughter over twenty-one who was found to be self-supporting.

Section 71 of the Public Welfare Law provides: Removal of non-resident and alien poor to other states and countries. When any person who is an inmate of any public home or is otherwise cared for at the expense of the state or of any public welfare district belongs to or has friends willing to support him or to aid in supporting him in any other state or country, the state department of social welfare may cause Ms removal to such state or country, provided, in the judgment of the state department of social welfare, the interest of the state and the welfare of such person will be thereby promoted. After notification of the proposed removal, if such person shall refuse to be so removed, the commissioner of the public welfare district wherein such person is being cared for may, with the prior approval of the state department, apply to the county judge of Ms county for the issuance of an order to the sheriff of the county in wMch such person is being cared for, or to some other person or persons, to remove the person to the state or country or district therem legally responsible for or willing to support him, and cause Ms removal thereto. The expense of such removal shall be paid from the state treasury on the warrant of the comptroller pursuant to a verified account submitted by the proper officer of the state department of social welfare.”

Upon tMs appeal appellants urge as their first pomt that, because the Chirillos crossed the New York State lme with the mtention of becoming permanent residents in New York State, therefore, they are residents of New York, and the statute if applied to the Chirillos who are residents of New York is unconstitutional.” Appellants also urge that to remove them to the State of OMo in accordance with the terms of the above statute would violate their privileges and immunities as citizens of the several States (art. 4, § 2, cl. 1), and as citizens of the United States (Fourteenth Amendment, § 1). Appellants further contend that it would also violate the Fourteenth Amendment of the United States Constitution in denying them due process of law, equal protection of the laws, and lastly would encroach upon the power of Congress to regulate commerce among the several States (art. 1, § 8).

Before proceeding to a consideration of the constitutional objections to the statute, it is claimed that we must dismiss this appeal and not decide the constitutional question urged upon us by all parties to tMs proceeding. The reason given is .that appellants, in addition to the constitutional issue, have included as a part of the first point in their brief, a claim that section 71 of the Public Welfare Law does not apply to any non-resident who crosses the State with the intention of becoming a resident, and that the statute as applied to non-residents may be emasculated by this simple device.

It is true that the Civil Practice Act, section 588, subdivision 3, places restrictions upon the jurisdiction of the Court of Appeals, among other things, where, as here, there is a direct appeal to this court upon constitutional grounds. The provisions of the Civil Practice Act in this regard are as follows: As of right, from a judgment or order of a court of record of original jurisdiction which finally determines an action or special proceeding where the only question involved on the appeal is the validity of a statutory provision of the state or of the United States under the constitution of the state or of the United States; and on any such appeal only the constitutional question shall be considered and determined by the court.”

The above provision consists essentially of two sentences, the first of which looks to and describes the judgment or order appealed from, and the second of which governs the action of the appellate court in considering the appeal. In other words, the first sentence provides that appeal may be taken from a judgment or order which finally determines an action or special proceeding, where the only question involved on the appeal is the validity of a statutory provision. In the case at bar a record is presented which establishes that the order providing for the removal could not have been granted unless section 71 of the Public Welfare Law had been held constitutional. Before the court could have ordered the removal, the constitutionality of section 71 of the Public Welfare Law was necessarily involved. The order appealed from could not be based upon a ground other than one holding this section constitutional. Under such circumstances there is ample authority to sustain our consideration of the constitutional problem. (Doubleday, Doran & Co. v. Macy & Co., 269 N. Y. 272; Cohen on the Powers of the New York Court of Appeals, p. 162. See, also, Chambers v. B. & O. R. R. Co., 207 U. S. 142, 148; Montana ex rel. Haire v. Rice, 204 U. S. 291, 299.) On the other hand, if the. County Court in the case at bar had denied the relief, a different question would have been presented and the decision might have been sustained upon a ground other than that of the validity of the statute under the Constitution. But even in this latter case there is authority permitting a decision of the constitutional question, for we have held that where the court, whose decision is appealed from, has determined that the statute is unconstitutional, and we have grave doubt whether the decision may not be sustained on grounds of construction of the statute rather than on constitutional grounds, yet where the construction of the statute is agreed upon by the court from which the appeal is taken and by all the parties to the proceeding, we will confine ourselves to the constitutionality of the statute and determine its validity. (Doubleday, Doran & Co. v. Macy & Co., 269 N. Y. 272.) We have, therefore, interpreted this section of the Civil Practice Act (§ 588, subd. 3) as vesting a discretion in the court to consider the other questions waived, and decide the constitutional question.

In the case at bar the Attorney-General asserts that the only question to be considered is the validity of section 71 of the Public Welfare Law. If the appellants may be held to have urged in the first point of their brief, in addition to the question of constitutionality, a question of construction, then it would seem that in the case at bar appellants must be held to have waived, for the purposes of this appeal, such latter contention for the following reasons. After the judge presiding at the Westchester County Court had held the statute (Public Welfare Law, § 71) constitutionally valid, as he must have done in order to grant the petition, appellants nevertheless moved for reargument with the sole aim to bring before this court on direct appeal the single issue of the validity of section 71 of the Public Welfare Law under the Federal Constitution. The judge at Special Term, in answer to this motion for reargument, thereupon expressly held the statute constitutional. Thereafter appellants appealed directly to this court with knowledge that the statute conferring jurisdiction upon this court prevented any question being decided by this court other than the validity of the statute under the Constitution. In a case, therefore, where the court of original jurisdiction has held the statute valid and must necessarily have passed upon the constitutional question, and counsel, having appealed directly to this court, attempts to raise other than constitutional questions, this court in its discretion may hold that appellants have waived all other questions except as concerns the Constitution. And particularly is this true where the constitutional issue raised involves a public policy of great importance and where the other question, if raised, would be of secondary importance.

We pass then to a consideration of the validity of section 71 of the Public Welfare Law as it affects these appellants. Upon this appeal we are concerned only with the removal of a class of persons situated as are these appellants, namely, those coming into the State of New York who have had a legal settlement for the purposes of relief in another State of the United States, or, as section 71 puts it, belongs to * * * any other state * * Parenthetically the term “ belongs to has been construed in other States to mean legal settlement the same as held at Special Term and not controverted upon this appeal. (Town of Washington v. Town of Warren, 123 Conn. 268; Eden v. Southwest Harbor, 108 Me. 489.) We are not passing either on the constitutionality or on the construction of the provision in the same section where removal is sought upon the ground that the pauper has friends willing to support him or to aid in supporting him in any other state or country * * Section 71 may be valid as to the class of persons in the case at bar and not valid in respect to this other provision, (New York ex rel. Hatch v. Reardon, 204 U. S. 152, 160.)

We turn then to consider seriatim the constitutional objections advanced against the power of the State of New York to protect itself against an unprecedented influx of persons on relief or paupers coming from other States. Stating the question in different ways: Is it a privilege or immunity of a citizen of the United States to impose upon any State of his choice the burden of supporting himself and his family before he has satisfied reasonable settlement qualifications, as in the case at bar, of one year? Is there no way short of action by the Congress by which the States, severally or separately, may safeguard themselves from the threat to their security and solvency by incoming numbers of indigent families from other States? Lastly, is a statute designed to safeguard the welfare of the individual and the welfare of the State, and to protect a citizen of the United States from starvation and return him to his former place of settlement, where he will receive succor, a violation of the Constitution of the United States?

We take up first the objection based upon a claimed lack of due process under the Fourteenth Amendment and endeavor to show that section 71 is not unconstitutional but a reasonable exercise of the sovereign police power to attain a proper objective. Obviously, the State of New York, prior to the adoption of the United States Constitution, possessed the powers of a sovereign nation, which included the power to refuse admittance to, or to deport, a person coming from without its borders, whether or not that person crossed the State line with the intention of seeking permanent residence in this State.

Likewise, it is authoritatively settled that the adoption of the Constitution of the United States did not create the power of the State, but only limited such power and, except as so limited, the power of the State remains supreme. (Carter v. Carter Coal Co., 298 U. S. 238; 11 Am. Jur. p. 865, § 171.) How then, may we ask, has there been cut down this fundamental police power of the State to enact legislation removing paupers who have not yet acquired a legal settlement in this State, to the place of their last legal settlement? Under the due process clause of the Fourteenth Amendment, the only limitation upon the exercise of the police power must be that it concerns itself with the promotion of the public welfare through having a real and substantial relation to that end, and shall not be unreasonable, arbitrary or capricious. (Nebbia v. New York, 291 U. S. 502.) The historical background and present conditions leading up to forcible removal proceedings demonstrate not only their recognized need, but their reasonableness.

From the time of the early common law, the liberty of the pauper has been curtailed in the interests of the welfare of the various communities. In 1350, by'statute, the poor were to remain where they were resident, or to be sent to the place of their birth. (4 Holdsworth, History of English Law, p. 390 et seq.) In 1662 Parliament enacted the Poor Relief Act (13 and 14 Charles II, ch. 12), which permitted Justices of the Peace, upon complaint of the Overseers of the Poor, to remove by warrant to the place of their last legal settlement, paupers and those likely to be chargeable to the parish.” Counsel for the State of New York has pointed out that this principle of forcible removal of paupers to the place of their last settlement has been projected into the poor law of some thirty States. In 1773 the Colonial Legislature enacted a statute (Colonial Laws of New York, vol. 5, p. 513) practically identical with the above statute enacted in England in 1662, and since that time successive Legislatures of this State have continued statutes along the same line, culminating in section 71 of the Public Welfare Law. In addition, it should be noted that removals have long since been authorized by what is now section 27 of the State Charities Law (Cons. Laws, ch. 55), which in part reads as follows: State, non-resident and alien poor. The board, and any commissioner or officer of the department may * * * cause to be removed to the state or country from which he came any such non-resident or alien poor found in any such institution or otherwise supported or relieved at public expense.”

Action under these sections has long been the policy of the State Department of Social Welfare, under appropriate rules and regulations, which provide, among other provisions, that settlement in the other State must be definitely established, and that an authorization must be received for the return of such person from the authorized officials in the locality of settlement. “ Each proposed removal must be considered on a case work basis and a return effected only when the Commissioner of Public Welfare is satisfied that the welfare of the person and the interest of the State will thereby be promoted. State charges requiring temporary relief and care should be given a reasonable opportunity for rehabilitation unless they desire to return voluntarily.”

In addition,' in all cases there must be considered not only the welfare of the State, but also the welfare of such person, together with a prior approval of the State Department of Social Welfare, and then the approval and action by the Commissioner of Welfare, who may only apply to the County Judge for the issuance of an order of removal and satisfy the County Judge that the statute has been complied with. Then and then only may the County Judge issue the order to remove the person to the State where he has a legal settlement.

In the light of such a statutory history, the objection of arbitrariness and unreasonableness seems weak indeed.

What is due process of law may be ascertained by an examination of those settled usages and modes of proceedings existing in the common and statute law of England before the emigration of our ancestors, and shown not to have been unsuited to their civil and political condition by having been acted on by them after the settlement of this country.” (Twining v. State of New Jersey, 211 U. S. 78, 100.)

“ The Fourteenth Amendment, itself a historical product, did not destroy history for the States and substitute mechanical compartments of law all exactly alike. If a thing has been practiced for two hundred years by common consent, it will need a strong case for the Fourteenth Amendment to affect it.” (Jackman v. Rosenbaum Co., 260 U. S. 22, 31.) (See, also Coler v. Corn Exchange Bank, 250 N. Y. 136; affd., 280 U. S. 218; Ownbey v. Morgan, 256 U. S. 94.)

As illustrating the need, and showing that the issues herein are not sporadic but of great importance, it appears in Social Security Bulletin 77 of January, 1940, issued by the New York State Department of Social Welfare, that the average home relief granted in Ohio for the month of November, 1939, was $15.99, as against $36.12 in New York, with Westchester county exceeding the average of New York by having an average grant of $40.18, or, to put it more briefly, more than double the amount granted in Ohio. It also appears that the State cost of maintenance of charges in New York State has increased from $323,000 in 1927 to $1,557,000 in 1938 and $2,830,000 in 1939. The monthly average number of State charge cases increased from 3,923 during the fiscal year ending June 30, 1938, to 6,764 in the following fiscal year, or an increase of seventy-two per cent in one year. To a large extent this migration of destitute persons to New York must have been due to the fact that as to average home relief grants, New York ranks first in the country; Ohio ranks nineteenth. Within New York State, Westchester county occupies third position among the sixty-two counties. The city of New York has filed a brief amicus, in which it joins with the State in emphasizing “ the very great importance * * * of the determination of the question raised,” and says that the burden of relief is becoming intolerable and that unless those legally chargeable or willing to assume the burden can share the burden, the result will be “to jeopardize the entire structure of relief in this State.”

The statute in the case at bar is thus a reasonable means adopted by the State in order to prevent financial submersion while engaged in caring for the unfortunates and thwarting the spread of sickness, disease and crime.

It is next contended that the power given to the Congress, “ To regulate commerce * * * among the several States * * * ” (Art. 1, § 8), renders invalid section 71 of the Public Welfare Law. In the consideration of questions of constitutional construction we are reminded that “ unless the party setting up the unconstitutionality of the State law belongs to the class for whose sake the constitutional protection is given * * the objections will not be heard, and imaginary cases will not be gone into where, as here, the statute involved may be constitutional as affecting the litigants before the court and may not be constitutional as to others. (New York ex rel. Hatch v. Reardon, 204 U. S. 152, 160.) While the forcible removal of persons who are public charges and not entitled by reason of lack of length of residence to a legal settlement for relief purposes in the State, may to some extent affect interstate commerce, the case at bar does not present such an interference as is forbidden to the State when exercising the police power in defense of State welfare. It is settled by the authorities that, in the absence of congressional pre-emptions, the police power inherent in the States may be exercised within reasonable restrictions, even though there may be interference with interstate commerce. (City of New York v. Miln, 11 Pet. [U. S.] 102; Railroad Co. v. Husen, 95 U. S. 465; Plumley v. Massachusetts, 155 U. S. 461, 471; South Carolina State Highway Dept. v. Barnwell Bros. Inc., 303 U. S. 177; Arkansas-Louisiana Gas Co. v. Dept. of Public Utilities, 304 U. S. 61; Welch Co. v. New Hampshire, 306 U. S. 79; Eichholz v. Public Service Commission, 306 U. S. 268; Clason v. Indiana, 306 U. S. 439.)

No claim can be advanced that section 71 prevents any person from coming into this State. The statute, as construed below, would seem to have the effect only that, when a person who has not established a legal settlement in this State, applies for public care, he subjects himself to the removal provisions of section 71. Under this law, the State has no power of removal until application is made for State aid. Then, in the interests of the protection of the People from the spread of crime and disease and for the preservation of the financial resources of the State, the latter remits the applicant to the place legally responsible for him under well-settled principles of law.

Appellants further urge that the State had no power to enact section 71 of the Public Welfare Law for the reason that it is in contravention of the provision of the United States Constitution (Art. IY, §. 2, cl. 1) which provides that The Citizens of each State shall be entitled to all Privileges and Immunities of Citizens in the several States.” As was said by Mr. Justice Roberts in Hague v. C. I. O. (307 U. S. 496), at page 511: “ * * * it has come to be the settled view that Article IV, § 2, does not import that a citizen of one State carries with him into another, fundamental privileges and immunities which come to him necessarily by the mere fact of his citizenship in the State first mentioned, but, on the contrary, that in any State every citizen of any other State is to have the same privileges and immunities which the citizens of that State enjoy. The section, in effect, prevents a State from discriminating against citizens of other States in favor of its own.”

To hold that this clause protects the right of a citizen to be supported at public expense in any community to which he may journey, it is necessary to find that there is inherent in State citizenship a constitutional right to be supported at public expense free from any limitations whatsoever. This would include a right of the indigent person to live where he will although the crowding into one State may be a menace to society. No such right exists. “ Neither aliens nor the citizens of other States are invested by the Constitution with any interest in the common property of the People of this State.” (People v. Crane, 214 N. Y. 154, 161.) Section 71 does not interfere with the right of a citizen of one State to pass through or reside in any other State. Only if on coming from another State he applies for relief at public expense, to which he has no constitutional right, he is bound to accept the relief cum onere, or with the limitations of the reasonable provisions of the Public Welfare Law of New York State. If it be for his welfare and for the welfare of the State, he then subjects himself to the possibility of being compelled to return to the State wherein he has a legal settlement. Nor does section 71 of the Public Welfare Law make any discrimination upon the basis of State citizenship, for all who seek public relief must comply with the same requirements for a legal settlement or be subject to forcible removal. (Douglas v. N. Y., N. H. & H. R. R. Co., 279 U. S. 377.)

It is urged that that portion of the Fourteenth Amendment which affords to any person within its jurisdiction the equal protection of the laws,” renders invalid section 71. There is here, however, no invalid classification. (Heim v. McCall, 239 U. S. 175; People v. Crane, supra.) In Barbier v. Connolly (113 U. S. 27), it is said, at page 32: “ Class legislation, discriminating against some and favoring others, is prohibited, but legislation which, in carrying out a public purpose, is limited in its application, if within the sphere of its operation it affects alike all persons similarly situated, is not within the amendment.”

Section 71 of the Public Welfare Law is only a part of the general plan set up therein. Sections 59 and 59-a authorize the forcible removal of a person from one public welfare district to another within the State. In like manner an indigent person may be removed outside of the State to the State or country in which he has a legal settlement, if the conditions for his welfare and the welfare of the community, as laid down in section 71, are complied with. Thus, all persons who are supported at public expense are subject to removal to the place in which they have their legal settlement, and where they will be supported by the governmental unit responsible for their support. A New York citizen, ■under its Constitution and laws, may go on relief only at the cost of and subject to removal to his place of settlement. He cannot demand such relief in Montauk except subject to removal to Erie, if he has a legal settlement in the latter place. Thus the petitioner is treated no differently in principle than a citizen in New York under like circumstances.

Lastly, there is no merit to the claim that section 71 is rendered invalid by the constitutional provision that no State shfl.11 make or enforce any law which shall abridge the privileges or immunities of citizens of the United States * * (U. S. Const., 14th Amdt.) It would seem that the privileges and immunities of United States citizenship are none other than those which result from other provisions of the Constitution and from the laws of Congress; that unless some other constitutional provisions or Federal statute prescribes the right claimed to be a privilege or immunity of United States citizens, no further protection may be had by resort to that clause. (Hague v. C. I. O., 307 U. S. 496, 519-522; Slaughter-House Cases, 16 Wall. [U. S.] 36, 79, 80.) It has been shown above that the statute as herein applied does not contravene other guaranties of the Constitution; nor has the claim been advanced that there is applicable congressional enactment.

Freedom of residence, is restricted as to citizens only while on relief. This statute applies whether the citizen is of this State or of another State. Confinement to a poor house or farm may be the result of indigence. No interference is had with the right of any citizen to choose and establish a home. What is controlled is the unrestricted imposition of indigent persons and families without settlement upon a community and State where they cannot establish a home because of their indigent status. Freedom of residence is certainly restricted as to paupers; yet no instance of invalidity has been pointed out as to the poor laws permitting commitment of indigents to poor farms. A condition may often restrict a freedom. Vagrancy is one example; disease is another; and mental deficiency, a third. Such conditions restrict individual rights and freedom in the interest of the right, security and freedom of the rest of the community of the State.

The Public Welfare Law of New York seeks, with due regard to the rights of all those affected, to deal in a humane way with the problem of pauperism. The sovereign police power of the State of New York has been exercised properly and reasonably. Such legislation is permitted by the Constitution of the State, and nothing in the United States Constitution compels a holding that such legislation is invalid.

The order appealed from, in so far as it holds the provisions of section 71 of the Public Welfare Law constitutional, should be affirmed.

Lehman, Ch. J., Sears and Conway, JJ., concur with Lotjghran, J.; Lehman, Ch. J., concurs in separate opinion, in which Loughran and Sears, JJ., concur; Finch, J., dissents in opinion, in which Rippey and Lewis, JJ., concur.

Appeal dismissed.


source: Caselaw Access Project

author: Finch, J. Lehman, Ch. J.

license: Public Domain

text:
    John J. O’Kane, Jr., et al., Copartners, Doing Business as John J. O'Kane, Jr., & Co., Appellants, v. State of New York, Respondent.
    (Claim No. 24798.)

      Argued June 4, 1940;
    decided July 24, 1940.

      Earl Q. Kullman for appellants.
    The transactions at bar were sales in interstate commerce and involved the export of property from the State — any tax thereon is void. (Rearick v. Pennsylvania, 203 U. S. 507; Dahnke-Walker Milling Co. v. Bondurant, 257 U. S. 282.) The instruments indispensable to exportation or interstate commerce may not be taxed. (McCulloch v. Maryland,
      4 Wheat. 415; Brown v. Maryland, 12 Wheat. 419; Fairbank v. United States, 181 U. S. 283; United States v. Hooslef, 237 U. S. 1; McCall v. California, 136 U. S. 104; Rearick v. Pennsylvania, 203 U. S. 507; People ex rel. Hatch v. Reardon, 184 N. Y. 431; Nicol v. Ames, 173 U. S. 509.) The stock transfer tax is void as to export sales and sales in interstate commerce. (Robbins v. Shelby Taxing District, 120 U. S. 489; Lyng v. Michigan, 135 U. S. 161; Kansas City Ry. Co. v. Kansas, 240 U. S. 227; Sonneborn Bros. v. Cureton, 262 U. S. 506; Carson Petroleum Co. v. Vial, 279 U. S. 80; Fisher’s Blend Station, Inc., v. State Tax Commission, 297 U. S. 650; Western Live Stock Co. v. Bureau of Revenue, 303 U. S. 250; Crew Levich Co. v. Pennsylvania, 245 U. S. 292.) The export-import clause applies to goods shipped from one State to another. (The Federalist, No. 42, Madison, Jan. 22, 1788; Almy v. California, 24 How. 169; Coe v. Errol, 116 U. S. 517; New York ex rel. Burke v. Wells, 208 U. S. 14.)

      John J. Bennett, Jr., Attorney-General (Leon M. Layden, Henry Epstein and Jacob S. Honigsbaum of counsel), for respondent.
    The tax did not violate the commerce clause of the Federal Constitution. (Felt & Tarrant Mfg. Co. v. Gallagher, 306 U. S. 62; Hump Hairpin Co. v. Emmerson, 258 U. S. 290; Southern Pacific Co. v. Gallagher, 306 U. S. 167; Pacific Tel. & Tel. Co. v. Gallagher, 306 U. S. 182; McGoldrick v. Berwind-White Coal Mining Co., 309 U. S. 33; McGoldrick v. Felt & Tarrant Mfg. Co., 309 U. S. 70; Field v. Barber Asphalt Paving Co., 194 U. S. 618; Pennsylvania R. R. Co. v. Knight, 192 U. S. 21; Pullman Palace Car Co. v. Pennsylvania, 141 U. S. 18; Adams Express Co. v. Ohio, 165 U. S. 194; Armour Packing Co. v. Lacy, 200 U. S. 226; Hopkins v. United States, 171 U. S. 578; Union Refrigerator Transit Co. v. Kentucky, 199 U. S. 194; Wiloil Corp. v. Pennsylvania, 294 U. S. 169.) Sections 270 and 270-a of the Tax Law (Cons. Laws, ch. 60) do not violate the Fourteenth Amendment to the United States Constitution. (Vaughan v. State, 272 N. Y. 102; Hatch v. Reardon, 204 U. S. 152.) The export-import clause of the Constitution does not apply. (Patapsco Guano Co. v. Board of Agriculture, 171 U. S. 350; New Mexico ex rel. McLean v. Denver & R. G. R. R. Co., 203 U. S. 38; State v. Pinckney, 10 Rich. Law Rep. [S. C.] 486; Coe v. Errol, 116 U. S. 517; Pittsburgh & Southern Coal Co. v. Bates, 156 U. S. 587; Brown v. Houston, 114 U. S. 622; American Steel & Wire Co. v. Speed, 192 U. S. 520; State Tax on Railway Gross Receipts, 15 Wall. 284; Woodruff v. Parham, 8 Wall. 123; Preston v. Finley, 72 Fed. Rep. 850.)
   Finch, J.

Appellants challenge the constitutionality of a tax statute. They have affixed the tax stamps as required and bring this action pursuant to section 280 of the Tax Law (Cons. Laws, ch. 60) to obtain a refund. The application. was made in the first instance to the Tax Commission, which denied the claim, and thereafter' to the Court of Claims. From a judgment of that court, dismissing the claim on the merits, appellants appeal directly to this court (Civ. Prac. Act, § 588, subd. 3), and have thus chosen to present for decision as the only question involved the validity under the Constitution of the United States of a statute which, as applied to the facts in the case at bar, imposes a tax upon an agreement for the sale of shares' of stock which are to be sold and delivered across State lines.

The facts are as follows: Appellants are partners in an investment and securities business, with offices in New York city. As a result of negotiations conducted by telephone, telegraph and mail, appellants entered into contracts to sell securities to Kennedy & Co., and to Butcher and Sherred, both of Philadelphia, Pennsylvania, and to Babbage & Co. of Washington, D. C. The purchasers mailed confirmations to appellants, who mailed confirmations of the sales to the purchasers. These memoranda are indispensable incidents of such transactions. Appellants mailed to banks in Philadelphia and in Washington, D. C., sight drafts for collection with the securities attached, and the banks remitted the proceeds by mailing checks to appellants in New York city. Title to the stock involved did not pass until payment was received by appellants.

In regard to the sale to Babbage & Co., there is a finding that the shares in question were delivered to MacKubin, Logg & Company of New York on behalf of the purchaser. Thus, in regard to this transaction, the record contains two inconsistent findings, to wit, that appellants delivered the shares to the purchaser via the collection bank, and that the appellants delivered the shares to an agent of the purchaser in New York.

Throughout all the transactions, the several memoranda exchanged between sellers and buyers stated that each party acted as a principal in the transaction. The agreements to sell were made in New York city, and the shares of stock which were the subject of the agreements were located in New York city both prior to and after the making of such agreement, and up to the time they were shipped in interstate commerce.

Section 270 of the Tax Law provides for a tax at the rate of one and one-half cents per share sold for less than twenty dollars, and of two cents per share sold for more than twenty dollars, upon “ all sales, or agreements to sell, or memoranda of sales and all deliveries or transfers of shares * * * whether made upon or shown by the books of the * * * corporation * * * or by any assignment in blank, or by any delivery, or by any paper or agreement or memorandum or other evidence of sale or transfer * * The seller is required to buy tax stamps, affix them, and have them canceled. When the transaction is consummated by the transfer of a certificate of stock, the stamps must be affixed to the certificate itself; “ and in cases of an agreement to sell, or where the sale is effected by delivery of the certificate assigned in blank, there shall be made and delivered by the seller to the buyer, a bill or memorandum of such sale to which the stamp * * * shall be affixed and cancelled.”

Section 270-a imposes an additional emergency tax at the same rate, so that the total tax is now three cents per share sold for less than twenty dollars, and four cents per ' share sold for more than twenty dollars.

The statute as applied to the transactions in the case at bar is said to offend the Constitution of the United States, particularly the due process clause (Fourteenth Amendment), the import-export clause (Art. I, § 10, cl. 2), andjthe commerce clause (Art. I, § 8, cl. 3).

Due process. Appellants suggest objection to the statute on this score, but they submit no supporting argument. Indeed, the question has been previously considered and' answered contrary to the contention of appellants. (New York ex rel. Hatch v. Reardon, 204 U. S. 152; Vaughan v. State, 272 N. Y. 102.)

Import-export duties. It is now well settled that the constitutional proscription that no State shall lay any imposts or duties on imports or exports ” applies only to foreign commerce and not to interstate commerce. (Woodruff v. Parham, 8 Wall. [U. S.] 123, 130; Coe v. Errol, 116 U. S. 517, 527; New Mexico ex rel. McLean & Co. v. Denver & Rio Grande R. R. Co., 203 U. S. 38.) Since the activities of appellants do not involve foreign commerce, they are in no position to question the application of the statute to transactions in foreign, as distinguished from interstate commerce. (New York ex rel. Hatch v. Reardon, supra.)

Interstate commerce. Appellants contend that the grant to Congress of power to regulate interstate commerce operates even in the absence of action by Congress to forbid the imposition of a non-discrimin atory State tax, upon an agreement made within the State with respect to goods which are within the State and prior to their shipment in interstate commerce. The question, it should be observed, is not with respect to the extent of the power of Congress to regulate interstate commerce, but whether a particular exercise of State power in view of its nature and operation must be deemed to be in conflict with this paramount authority.” (Bacon v. Illinois, 227 U. S. 504, 516; Federal Compress & Warehouse Co. v. McLean, 291 U. S. 17. Cf. Santa Cruz Co. v. Labor Board, 303 U. S. 453, 456.) It is said that the very existence of the power of Congress to regulate interstate commerce' necessarily precludes State regulation of events transpiring within the State when subsequent to such events interstate shipments are made by the taxpayer.

Cases concerned with the effect of the commerce clause upon State action are truly legion, and only a few in number will be adverted to here. One fundamental principle which is not now questioned is that State action is not necessarily unconstitutional merely because it has some effect on interstate commerce (Baldwin v. Seelig, Inc., 294 U. S. 511, cas. cit. 525); and in regard to taxation, State levies are not necessarily invalid because they result in some increase in the cost of doing interstate business. (Western Live Stock Co. v. Bureau of Revenue, 303 U. S. 250, cas. cit. 254, 255.) No simple test is available.' It being once admitted, as of course it must be, that not every law that affects commerce among the states is a regulation of it in a constitutional sense, nice distinctions are to be expected * * *. It appears sufficiently, perhaps from what has been said, that we are to look for a practical rather than a logical or philosophical distinction.” (Per Holmes, J., Galveston, Harrisburg & San Antonio Ry. Co. v. Texas, 210 U. S. 217, 225, 227.) This does not satisfy those who seek for mathematical or rigid formulas, but such formulas are not provided by the great concepts of the Constitution such as ‘ interstate commerce,’ ‘ due process,’ ‘ equal protection.’ In maintaining the balance of constitutional grants and limitations, it is inevitable that we should define their applications in the gradual process of inclusion and exclusion.” (Per Hughes, Ch. J., Santa Cruz Co. v. Labor Board, supra, at p. 467.)

The> validity of State regulation under the commerce clause is to be determined by the balancing of two considerations : that State government shall be able to derive revenue for its support, and that commerce among the States shall be unfettered by provincial impediments. Stated conversely, interstate commerce must bear its share of the tax burden G' along with intrastate commerce, but the States may not exact of interstate commerce a toll heavier than that which intrastate commerce is liable to pay. The consequences of these principles have been variously stated. The States may not impose a “ direct ” tax or a tax on interstate commerce as such;” interstate commerce may not be subjected to multiple burdens to which intrastate commerce is not exposed. But however expressed, the guiding principle which limits the power of the States to tax is that the several States of the Union may not discriminate against interstate commerce in favor of intrastate commerce.

It is a matter of historical' record that the Founding Fathers were concerned lest State rivalries should lead to the stifling of trade carried on beyond the confines of any single State. But it was not thereby intended that commerce among the several States, when once protected from the dangers of local prejudice, should altogether escape its proportionate share of the cost of government. (McGoldrick v. Berwind-White Coal Mining Co., 309 U. S. 33; Felt & Tarrant Mfg. Co. v. Gallagher, 306 U. S. 62; Southern Pacific Co. v. Gallagher, 306 U. S. 167; Henneford v. Silas Mason Co., 300 U. S. 577; Western Live Stock Co. v. Bureau of Revenue, supra.) In the Berwind-White case the courts sustained the sales tax imposed on the buyer although the goods previously had been transported interstate. The contract between the seller and the buyer was made in New York and the goods were delivered in New York. In answering the claim of immunity from taxation because interstate commerce had preceded the taxable event the court said in part: “ As we have often pointed out, there is no distinction in this relationship between a tax on property, the sum of all the rights and powers incident to ownership, and the taxation of the exercise of some of its constituent elements. * * * Taxation of property or the exercise of a power over it immediately preceding its previously contemplated shipment interstate has been similarly sustained. (Cit.) For reasons already indicated all such taxes upon property or the exercise of the powers of ownership stand in no different relation to interstate commerce and have no different effect upon it than has the present sales tax upon goods whose shipment interstate into the taxing State was contemplated when the contract was entered into.” (309 U. S. at pp. 52, 55.) In the case at bar certain goods, to wit, shares of stock, were located in this State and were part of the common mass of property which undoubtedly was subject to taxation. The taxable event, to wit, the making of the agreement for the sale of the property, occurred in this State prior to the transportation of the goods in interstate commerce, and was an exercise of one of the incidents of ownership. In imposing a tax on the exercise of one of the incidents of ownership, no discrimination was practiced on interstate commerce. Appellants object to the taxation of a local event because it is followed by interstate commerce. But unless local events occurring after interstate commerce has ended are clothed with a greater sanctity than are possessed by local events preceding interstate commerce, such objection must fail. (McGoldrick v. Berwind-White Coal Mining Co., supra.) Indeed, it would appear that no such distinction has been drawn. (Coe v. Errol, supra; Bacon v. Illinois, supra; Federal Compress & Warehouse Co. v. McLean, supra.) The simple grant of power to the Congress to regulate interstate commerce would not seem of itself to lead to any distinction such as is contended for by appellants.

Appellants then argue that the decision in the BerwindWhite case would permit the State of destination, to wit, Pennsylvania, likewise to impose a sales tax, and that cumulative burdens would thus be borne by interstate commerce. It should be noted that the plaint is not of a present condition, for the record is barren of any suggestion that such a tax has been imposed on the transactions in the case at bar. But assuming that the Berwind-White decision is authority for the proposition that the State of the buyer may impose a sales tax on the buyer, that does not render interstate commerce hable to greater taxation than that which may be levied upon intrastate commerce. In cases such as Gwin, White & Prince, Inc., v. Henneford (305 U. S. 434) and Adams Mfg. Co. v. Storen (304 U. S. 307), the taxes there in question were held invalid because the taxable event was equally within the jurisdiction of States other than the one of origin and the one of destination, and hence the same event could have been taxed in each State through which the shipment passed if the levy had been sustained. But in the case at bar it may be said truly, as was said in McGoldrick v. Berwind-White, “ the present tax as applied to respondent is without the possibility of such consequences.” (309 U. S. at p. 48.) In the circumstances of the case at bar, as has been said, the taxable event is the making in this State of a contract to sell goods which are in this State. This event is no more, recurrent than the taxable event in Berwind-White, and hence the possibility of cumulative taxes is equally absent. If upon the facts before us the State of the buyer may place a tax on the buyer, then the situation is no different from the power of a State to levy taxes on the different incidents of intrastate transactions. That another State may choose to enact a different kind of tax does not deprive the tax in this State of its constitutionality. To illustrate, let us suppose that the facts are those presented in the record in the case at bar, and that the State of the seller imposes two sales taxes, one on the seller and one on the buyer, and that the State of the buyer imposes like levies. An intrastate transaction would be hable for two taxes in all, one paid by the seller and another by the buyer. There is no reason why the same kind of transaction, when carried on between two States, should not bear the same total burden; the State of the seller would be entitled to the tax due from the seller, and the corresponding situation would prevail in the State of the buyer. According to the argument of the appellants, the interstate transaction would obtain an advantage over intrastate commerce. In the guise of barring discrimination against interstate commerce, special privilege would be accorded to that commerce to the disadvantage of intrastate commerce. Such a result is not required by the provision that “ The Congress shall have Power * * * to regulate Commerce * * * among the several States * •* * * ” (U. S. Const. art. I, § 8.)

Appellants argue that the rulings of the Stock Transfer Bureau seek to enforce the tax upon transactions converse to those in the case at bar, so that the statute has the effect of applying, both to sales made within the State to extra-State buyers, and to sales by extra-State sellers to local buyers. The question of the application of the statute to such situations is not now before this court. The narrow question for decision in the case at bar is whether the commerce clause forbids the application of the statute in question to the facts presented by the record in the case at bar. The constitutionality of the statute, as applied to those in a class other than that in which appellants find themselves, does not aggrieve appellants, who may complain, when a statute is similar to that in the case at bar, only of such matters as concern them. This court may declare statutes unconstitutional only in so far as it is essential to do so in order properly to determine the relative rights of the litigants. (Marbury v. Madison, 1 Cranch [U. S.], 137; New York ex rel. Hatch v. Reardon, supra.)

The judgment should be affirmed, with costs.

Lehman, Ch. J.

(dissenting). The statute provides for a tax upon sales and transfers of shares of stock. The claimants are engaged in an investment and securities business in the city of New York. In the course of their business, they agreed to sell shares of stock to two firms, one engaged in business in Philadelphia and the other in Washington, and, thereafter, mailed the securities to banks in Philadelphia and Washington, D. C., for delivery upon payment of sight drafts which were attached. The plaintiffs challenged the validity of the Tax Law of the State of New York (Cons. Laws, ch. 60) in so far as it purports to impose a tax upon the sale or transfer of the stock which the plaintiffs have sold and delivered to persons outside of the State of New York, on the ground that such a tax constitutes an unlawful burden on interstate commerce.

The sellers reside in New York and, unquestionably, the State would have power to tax their personal property here, including property which the plaintiffs intend to use in interstate commerce, until the moment when such property becomes part of a movement in interstate commerce. The purchasers live in other jurisdictions and, unquestionably, such jurisdictions would have power to tax their property immediately after it was delivered in the course of interstate commerce to the purchasers. The Tax Law of New York State, which is challenged, does not, however, attempt to tax the property of the plaintiffs or any exercise of power over such property by them, except in connection with a sale in interstate commerce.

Every transaction in interstate commerce requires the performance of acts in two or more States. Here the contract was made by telephone, telegraph and mail, with the messages originating in one State and received in another State, and the contract of sale became effective only upon exchange of confirmation by the buyer outside of the State and the seller here. The shares of stock were mailed here, passed through other States to the cities where the purchasers did business. Payment was made there and transmitted to the sellers here. Authority of the State, if any, to tax the sale or transfer of the stock must rest upon the fact that the sellers lived here and the State had jurisdiction of the property before it entered into the stream of interstate commerce, or upon the fact that part of the transaction in interstate commerce occurred here.

If the State of New York had power to tax the sale or transfer of this property on such grounds, then it would seem clear that Pennsylvania and the District of Columbia would each have the right to tax the sale or transfer of such securities because the purchaser resides and the transfer is made there. But in such case “ interstate commerce would thus be subjected to the risk of a double tax burden to which intrastate commerce is not exposed and which the commerce clause forbids.” (Adams Manufacturing Co. v. Storen, 304 U. S. 307, 311, decided May 16, 1938; Gwin, White & Prince, Inc., v. Henneford, 305 U. S. 434.) It is said that there is no proof here that, in fact, Pennsylvania or the District of Columbia do impose any tax upon the transfer of the stock outside of this State or that, in this case, the sales have, in fact, been subjected to a tax burden greater than similar sales where purchaser and seller both live in the State of New York and transfer is made there. It is established by a long line of cases, referred to and approved in the two cases cited above, that interstate commerce may not be subjected to the risk of double taxation •— whether, in fact, two or more States have joined in imposing multiple taxes is immaterial if the risk of multiple taxation exists. So, in Adams Manufacturing Co. v. Storen (supra) the Supreme Court of the United States declared invalid a State tax on gross income derived by a manufacturer from sales in interstate commerce, saying that the tax “is of such a character that if lawful it may in substance be laid to the fullest extent by states in which the goods are sold as well as those in which they are manufactured ” (p. 311). I can find no distinction in principle between the tax there declared invalid and the tax which is here challenged. To sustain this tax we must reject the authority of what was so recently said and decided by the Supreme Court of the United States.

The State, however, relies for authority to a great extent upon the later case of McGoldrick v. Berwind-White Coal Mining Co. (309 U. S. 33). It may hardly be supposed that the majority of the court intended in that case to destroy the force of its previous decisions without even mentioning the decisions which it intended to overrule or weaken. In the last case the opinion by Mr. Justice Stone indicates clearly the factors which induced the court to sustain the tax in that case, though it was a tax on a sale in interstate commerce.

After analyzing the tax there challenged, Mr. Justice Stone pointed out: “ The ultimate burden of the tax, both in form and in substance, is thus laid upon the buyer, for consumption, of tangible personal property, and measured by the sales price. Only in event that the seller fails to pay over to the city the tax collected or to charge and collect it as the statute requires, is the burden cast on him. It is conditioned upon events occurring within the state, either transfer of title or possession of the purchased property, or an agreement within the state, ‘ consummated ’ there * * *”(p. 43).

Then he points out that

“ Certain types of tax may, if permitted at all, so readily be made the instrument of impeding or destroying interstate commerce as plainly to call for their condemnation as forbidden regulations. Such are the taxes already noted which are aimed at or discriminate against the commerce or impose a levy for the privilege of doing it, or tax interstate transportation or communication or their gross earnings, or levy an exaction on merchandise in the course of its interstate journey. Each imposes a burden which intrastate commerce does not bear, and merely because interstate commerce is being done places it at a disadvantage in comparison with intrastate business or property in circumstances such that if the asserted power to tax were sustained, the states would be left free to exert it to the detriment of the national commerce.

“ The present tax as applied to respondent is without the possibility of such consequences. Equality is its theme. Cf. Henneford v. Silas Mason Co., 300 U. S. 577, 583. It does not aim at or discriminate against interstate commerce. It is laid upon every purchaser, within the state, of goods for consumption, regardless of whether they have been transported in interstate commerce. Its only relation to the commerce arises from the fact that immediately preceding transfer of possession to the purchaser within the state, which is the taxable event regardless of the time and place of passing title, the merchandise has been transported in interstate commerce and brought to its journey’s end. Such a tax has no different effect upon interstate commerce than a tax on the ‘ use ’ of property which has just been moved in interstate commerce sustained in Monamotor Oil Co. v. Johnson, 292 U. S. 86; Henneford v. Silas Mason Co., supra; Felt & Tarrant Mfg. Co. v. Gallagher, 306 U. S. 62; Southern Pacific Co. v. Gallagher, 306 U. S. 167, or the tax on storage or withdrawal for use by the consignee of gasoline, similarly sustained in Gregg Dyeing Co. v. Query, 286 U. S. 472; Nashville, C. & St. L. Ry. Co. v. Wallace, 288 U. S. 249; Edelman v. Boeing Air Transport, 289 U. S. 249, or the familiar property tax on goods by the state of destination at the conclusion of their interstate journey. Brown v. Houston, supra; American Steel & Wire Co. v. Speed, 192 U. S. 500 ” (pp. 48, 49). (Italics throughout are ours.)

Here the tax is imposed upon the seller and not the buyer and it has no possible analogy to a use ” tax or a property tax on goods at their destination. If this tax is sustained, then similar sales in interstate commerce may be subjected to the risk of a burden of multiple taxation which might impede or destroy such commerce, and similar taxes have been declared a violation of the Constitution whenever challenged. It is said that the State of New York would have power to require both buyer and seller to pay a tax upon a sale made in intrastate commerce and that sales in interstate commerce may properly be made subject to the same risk that where buyer and seller live in different States, each may be required to pay a tax upon the sale. Perhaps some inscrutable reason might induce a State to require both buyer and seller to pay a sales tax on intrastate commerce and only one to pay a sales tax on interstate commerce. We do not now pass upon the validity of such a tax. Here the State has attempted to subject a sale in interstate commerce to the same single tax which must be paid on other sales and other States would have power, at least as good, to impose a similar sales tax upon the same sale.

The judgment should be reversed, with costs in all courts, and judgment directed for the claimants for the taxes they have paid, with interest.

Rippey, Sears and Lewis, JJ., concur with Finch, J.; Lehman, Ch. J., dissents in opinion, in which Lotjghran and Conway, JJ., concur.

Judgment affirmed.


author: Loughran, J. Lehman, Ch. J.

text:
    Eva Keener, Appellant, v. Benjamin E. Tilton, as Trustee of New York State Railways, Respondent.
    Argued March 8, 1940;
    decided July 24, 1940.

      Albert Orenstein for appellant.
    The Appellate Division erred in applying the wrong standards of liability of the defendant. (Derby v. Degnon-McLean Contracting Co., 112 App. Div. 324; Durr v. N. Y. C. & H. R. R. R. Co., 184 N. Y. 320.) The application of the rules relating to the responsibility of municipalities fpr depressions are not applicable to a common carrier. (Grissinger v. International Ry. Co., 143 App. Div. 631; Walsh v. Syracuse Rapid Transit Ry. Co., 70 App. Div. 362; Welch v. Syracuse Rapid Transit Ry. Co., 89 App. Div. 616; 181 N. Y. 565; Wolf v. Third Ave. R. R. Co., 67 App. Div. 605; Wells v. Steinway Ry.

      Co., 18 App. Div. 180; Flack v. Nassau Electric R. R. Co., 41 App. Div. 399; Page v. United Traction Co., 161 App. Div. 384; Walsh v. Richmond Light & R. R. Co., 124 App. Div. 533; Engel v. Brooklyn & Queens Transit Corp., 252 App. Div. 792.) The location, size and depth of the hole and its continued existence for one month prior to the accident, definitely established liability on the part of the trolley company. (Durr v. N. Y. C. & H. R. R. R. Co., 184 N. Y. 320; Terry v. Village of Perry, 199 N. Y. 79; Faber v. City of New York, 213 N. Y. 411; Carr v. City of New York, 281 N. Y. 469.)

      Lewis P. Smith, Jr., and Willis H. Michell for respondent.
    Plaintiff failed to sustain the burden of proof as to the negligence of the defendant. (Weiser v. Dry Dock, E. B. & B. R. Co., 188 N. Y. Supp. 856; Stierle v. Union Ry. Co., 156 N. Y. 70; Belts v. Buffalo, R. & P. Ry. Co., 222 N. Y. 433; Palsgraf v. Long Island R. R. Co., 248 N. Y. 339; Terry v. Village of Perry, 199 N. Y. 79; Lalor v. City of New York, 208 N. Y. 431; Stakel v. City of Batavia, 260 N. Y. 628; Grissinger v. International Ry. Co., 143 App. Div. 631; Kantrowitz v. Brooklyn, Q. C. & S. R. R. Co., 173 App. Div. 192.)
   Loughran, J.

In alighting after dark from a trolley car of the defendant at a street crossing, plaintiff stepped into a hole in the pavement and fell. A judgment entered on a verdict for her damages has been reversed and the complaint dismissed.

The hole in the street was outside the defendant’s right of way. It was a rectangular depression eleven and three-quarters inches long and six inches wide. Lengthwise it formed a right angle with the track of the defendant and at its end nearer thereto was not more than two inches deep. There was uncontradicted evidence of its existence for at least one month before the accident. Whether claims had been made against the defendant for similar accidents the record does not show.

The trial judge left to the jury the question as to whether or not this depression was of such a character ás to charge this defendant with negligence.” The jury’s answer in favor of the plaintiff has been rejected by the Appellate Division as contrary to and against the weight of the evidence.

Argument for the defendant does not go so far as to assert that a carrier owes no duty at all to passengers in respect of hazardous conditions of the journey external to its own property and equipment. But the defendant does take the broad ground that a passenger when getting off the step of a street car must in all cases depend upon himself alone for protection against the possibility of his stepping into a depression in the highway which a municipality would not be bound to repair for the safety of pedestrians. We see no reason for establishing so substantial an exception to the rule which requires of carriers of persons that their undertaking be discharged with all due caution and forethought.

A hole in a street must be pretty deep before a pedestrian injured thereby can hold the municipality to payment of his damages. (Lalor v. City of New York, 208 N. Y. 431.) This is a practical limitation upon the implied civil liability of municipal corporations respecting defective streets. Such residual governmental immunity in that field cannot be made to shelter proprietors of street railways against indifference in setting down passengers at insecure places on the highway.

The essential duty of a carrier may call upon it to safeguard a passenger against inconspicuous dangers of the road that should be known to it. (Dudley v. Smith, 1 Campb. 167; Schlessinger v. Manhattan Ry. Co., 98 N. Y. Supp. 840.) It may be that the hole which caused this plaintiff’s fall was not exactly a trap. But was it self-evident that the risk of such a mishap was altogether remote even in the nighttime? Or that no convenient way of disclosing the pitfall to the plaintiff would have kept her on her feet? Matters of that kind were to be considered in deciding upon the quality of the conduct of this defendant’s servants in the circumstances. We cannot say that their conduct was so plainly sufficient that the question should not go to a jury.

The judgments should be reversed and a new trial granted, with costs to abide the event.

Lehman, Ch. J.

(dissenting). The depression into which the plaintiff stepped was in a portion of the street paved with bricks. It was a few feet south of a crosswalk at a point where a street car would ordinarily be expected to stop in order to let off passengers. The depression, according to the plaintiff’s witnesses, was the “ length of a brick and the width of a brick ” and it appeared to these witnesses as if the surface of one brick in the pavement was an inch and a half or two inches below the surface of the other bricks. Stepping into that depression, the plaintiff fell, and for the injuries suffered in her fall, the street railway company has been held liable.

The duty to keep the street safe rests upon the city, but as Judge Loughran states in his opinion, a hole in a street must be pretty deep before a pedestrian injured thereby can hold the municipality to payment of his damages. (Lalor v. City of New York, 208 N. Y. 431.) ” Freedom of the city from liability for damages caused to a pedestrian by a fall in a depression of less depth is not, I think, based upon any residual government immunity ” from liability for failure by the city to exercise reasonable care in the performance of its duty to keep the streets safe for those who use them, but rather on the ground that depressions in a sidewalk or crosswalk of a street, which are not pretty deep,” create no danger to a pedestrian so serious that the city in the exercise of reasonable care might have anticipated and should have guarded against the hazard. (Cf. Beltz v. City of Yonkers, 148 N. Y. 67, and other cases cited by this court in Lalor v. City of New York, supra.) Since the defendant railway company is under no duty to keep the streets near its tracks in repair, liability for the plaintiff’s fall cannot be predicated upon the condition of the street. The defendant’s duty to the plaintiff was only to exercise “ ordinary care in furnishing a safe place to passengers to enter upon or alight from its cars.” (MacKenzie v. Union Ry. Co., 82 App. Div. 124, 129; affd., 178 N. Y. 638.) Its duty to its passengers is different from the duty which the city owes to pedestrians, but the measure of the duty of each is reasonable care and it is liable only for neglect to perform this duty.” (Beltz v. City of Yonkers, supra, p. 70.) The rule which requires carriers and municipal corporations alike to discharge their respective duties with all due caution and forethought ” is not subject to any arbitrary exception made by the courts in favor of either, nor can the responsibility of a carrier for failure to exercise due caution and forethought in the performance of the duty imposed upon it by law be enlarged or restricted by the care or lack of care of the city in the-performance of its duties.

The depth of the hole and the consequent danger which a reasonable man might apprehend is, nevertheless, an important if not decisive factor in determining both whether the city, in failing to repair the hole, has been guilty of want of due caution and foresight ” in the performance of its duty to keep the streets of the city in safe condition, and whether the carrier in stopping its car near the hole has been guilty of want of due caution and forethought ” in the performance of its duty to provide a safe place for passengers to alight. Here, no failure by the carrier to use due care has been shown unless it can be said that the employees of the company not only should have discovered the depression in this street, which had existed for a month, but should have realized that such depression made a usual stopping place of cars unsafe for alighting passengers, although the depression was so slight that the city was not under any duty to repair it. In measuring reasonable care, practical standards must be used, and it seems to me that there can be no finding of want of care under the circumstances of this case except by application of a standard almost fantastic in its disregard of realistic and practical considerations.

The judgment of the Appellate Division should be affirmed.

Finch, Rippey and Conway, JJ., concur with Loughran, J.; Lehman, Ch. J., dissents in opinion; Sears and Lewis, JJ., taking no part.

Judgments reversed, etc.


author: Lehman, Ch. J.

text:
    In the Matter of the Claim of John P. Daus, Respondent, against Gunderman & Sons, Inc., et al., Appellants. State Industrial Board, Respondent.

      Argued May 22, 1940;
    decided July 24, 1940.

      Irvin A. Snyder for appellants.
    The decision of the State Industrial Board was a compelling decision by order of the Appellate Division and the order of that court dated and filed December 19, 1938, was in violation of the Workmen’s Compensation Law in that the Appellate Division reviewed a question of fact and in its own judgment reversed the previous decision and findings of the Industrial Board dated and filed on the 15th day of May, 1937. (Benjamin v. Rosenberg Bros., 180 App. Div. 234; Matter of Chetney v. Manning Co., 273 N. Y. 82; Matter of Haverhals v. Badman, 243 App. Div. 848.)

      John J. Bennett, Jr., Attorney-General (Roy Wiedersum of counsel), for State Industrial Board, respondent.
    The order of the Appellate Division should be affirmed. (Matter of Falk v. Midland Dairy Co., 248 App. Div. 929; 273 N. Y. 616; Matter of Green v. Geiger, 255 App. Div. 903; 280 N. Y. 610; Matter of Whitmyre v. International Business Machines Corp., 249 App. Div. 678; 274 N. Y. 61; Matter of Bervilacqua v. Clark, 222 App. Div. 784; 225 App. Div. 190; 250 N. Y. 589.)

      George S. Goldberg for claimant, respondent.
    The Appellate Division by its order dated and filed December 19, 1938, did not review a question of fact in reversing the previous decision and findings of the Industrial Board dated May 15, 1937, for any finding of fact by the Industrial Board not supported by legal evidence is not final and may be reversed by the Appellate Division. (Matter of Bennett v. Marine Works, Inc., 273 N. Y. 429; Matter of Carroll v. Knickerbocker Ice Co., 218 N. Y. 435; Matter of Brynildsen v. Mt. Vernon Novelty Curtain Co., 239 App. Div. 566; Carr v. Donner Steel Co., 207 App. Div. 3.)
   Lehman, Ch. J.

The claimant was injured while he was driving his automobile in Queens county shortly before midnight on September 11, 1936. He was employed as a salesman by a corporation engaged “ in the business of selling automobile brakes and general brake service.” The claimant used bis own automobile in the performance of his work. It would have been impossible for him to do the work required of him without an automobile. He testified that on the evening of the accident he met a prospective customer who desired to establish an automobile service station in Queens county; that they had dinner together, and that claimant, intending to sell to the customer a brake-testing machine and other equipment after the service station was established, drove the prospective customer around Long Island City during the entire evening looking for a good location for the proposed station; that at eleven-thirty p. m. he dropped the prospective customer and was proceeding to his own home when the accident occurred. The testimony of the claimant was corroborated by the alleged prospective customer. If true, there can be no doubt that the claimant’s accidental injuries were sustained in- 'the course of his employment and arose out of his employment. The referee, after hearing the witnesses, so found, but the Industrial Board thereafter reversed the decision and found that the claimant was not entitled to any award. It rejected the testimony produced by the claimant because of inherent improbability in that testimony, and refused to find that the midnight accident occurred in the course of the claimant’s employment.

The Appellate Division reversed the decision of the Industrial Board and by order entered December 5, 1938, remitted the matter to the State Industrial Board for an award in favor of the claimant and against the employer, Gunderman & Sons, Inc., and against the insurance carrier, The Century; Indemnity Co. of Hartford, Connecticut.” After a brief hearing to determine the amount to which the claimant would be entitled for accidental injuries sustained in the course of and arising out of his employment, the Industrial Board made the “ award in favor of the claimant and against the employer * * * and against the insurance carrier ” which the Appellate Division had directed it to make. It held no hearing de nova upon the merits of the claim. The Appellate Division had issued a mandate which, under the express terms of the order, left to the Industrial Board no judicial discretion upon the question of whether or not the claimant was entitled to an award. That was determined by the order of the Appellate Division. Further judicial or quasi-judicial action by the Industrial Board was confined to determination of the amount of the award. The employer and carrier appealed from the award, and thereafter the Board, in accordance with the provisions of section 23 of the Workmen’s Compensation Law (Cons. Laws, ch. 67) filed its findings of fact and rulings of law in support of the award it had made under mandate of the Appellate Division.

The Appellate Division unanimously affirmed the award, and the employer and carrier, by permission of this court, have appealed from the order entered upon the decision of the Appellate Division. Upon that appeal, and by proper notice, the appellants seek to bring up for review the order of the Appellate Division reversing the original decision of the Industrial Board and remitting the matter to the State Industrial Board “ for an award.” As we have pointed out, the evidence produced by the claimant, if credited by the trier of the fact, would, undoubtedly, be sufficient to support findings that the accidental injuries were sustained by the claimant in the course of, and arose out of, his employment. Upon the first hearing the trier of the fact chose to reject much of that evidence. Upon the second hearing it based findings upon the evidence which it had previously rejected. The respondents urge that on that ground the decision of the State Industrial Board must be affirmed in accordance with the command of the statute that the decision of the board shall be final as to all questions of fact.” (Workmen’s Compensation Law, § 20.) That decision, however, though in form a decision of the State Industrial Board, is made by direction of the Appellate Division, and the primary question then is whether this court may review that direction of the Appellate Division rendered upon the earlier appeal.

The respondents urge that this court has already decided that a decision on the facts by the State Industrial Board is final if sustained by the evidence, even though such decision was made after the Appellate Division had reversed an earlier contrary decision by the Industrial Board. (Citing Matter of Falk v. Midland Dairy Co., 273 N. Y. 616; Matter of Green v. Geiger, 280 N. Y. 610; Matter of Whitmyre v. International Business Machines Corp., 274 N. Y. 61.) These cases are not authority for the contention that the court may not in this case review the intermediate order of the Appellate Division reversing the original decision of the State Industrial Board. In Matter of Falk v. Midland Dairy Co. (supra) the appellant did not by proper notice of appeal bring up for review the intermediate order of the Appellate Division. Moreover, in that case this court was of the opinion that the evidence established conclusively and as matter of law the facts found by the State Industrial Board in accordance with the mandate of the Appellate Division. In Matter of Green v. Geiger (supra) the intermediate decision of the Appellate Division merely directed a hearing de nova, and in express terms informed the State Industrial Board that upon such hearing it was free to exercise its untrammeled discretion. In Matter of Whitmyre v. International Business Machines Corp. (supra) we held only that the State Industrial Board was, under the statute, free to hold a new hearing and make new findings even though the appellate courts had dismissed a claim.

The rule is' well established that an intermediate order of the Appellate Division reversing a decision and granting a hearing de nova before the original tribunal, does not necessarily affect the final decision of that tribunal after the new hearing, and may not be reviewed upon appeal from such final decision. (Taylor v. Root, 48 N. Y. 687; Kade v. Sanitary F. & C. Co., 257 N. Y. 203; Cohen on The Powers of the New York Court of Appeals, p. 211.) In such case this court reviews the judgment or order entered after the new hearing as if no earlier judgment or order had been entered and thereafter reversed by the Appellate Division. That is not true, however, where the intermediate order of the Appellate Division does not direct a new hearing but directs the decision which must be made. That is the case here. The Appellate Division order was intermediate only because it left open for judicial consideration the question of the amount of the award. It determined that the award must be made in the amount thereafter fixed by the Industrial Board. The Appellate Division could pass only upon the question of law whether the evidence conclusively established that the claimant was entitled to an award. It was without power to reverse a finding of fact sustained by the evidence, or to direct the Industrial Board to make a finding not established as matter of law by the evidence. The ruling by the Appellate Division on the question of law necessarily affected the subsequent decision of the Industrial Board which merely followed the ruling of law made by the Appellate Division. Any other holding would defeat the legislative direction that a decision by the Industrial Board on the facts is not subject to review by an appellate court.

It would serve no purpose to analyze the evidence produced by the claimant to establish his claim. The Industrial Board in rejecting the testimony of the claimant and his alleged prospective customer, pointed out the reasons why it refused to credit that testimony. Certainly it cannot be said that the Industrial Board was bound as matter of law to accept it. The Appellate Division had no power to weigh that testimony anew or to constrain the Industrial Board to accept it. The decision of the Industrial Board rejecting the claim was final unless even without the’ challenged testimony the claimant conclusively established his right to an award.

Though the claimant had no regular hours of work and did frequently work at night, it may hardly be said that these facts alone would justify an inference that injuries due to an accident occurring near midnight while the claimant was driving home alone, were sustained while the claimant was actually engaged in performing his duties as a salesman. Some further explanation certainly would be required in order to justify a finding that the day’s occupation had not been concluded before that time, at least if the burden of producing evidence to show that the accident occurred in the course of his employment rested upon the claimant. It is urged now that such burden does not rest upon the claimant, but that he may rely upon the statutory presumption that in any proceeding for the enforcement of a claim for compensation under this chapter, it shall be presumed in the absence of substantial evidence to the contrary (1) that the claim comes within the provision of this chapter * * (§ 21.)

The statute is not intended to relieve completely an employee from the burden of showing that accidental injuries suffered by him actually were sustained in the course of his employment and arose out of the employment. It is not the law that mere proof of an accident without other evidence creates the presumption under section 21 of the Workmen’s Compensation Law (Cons. Laws, ch. 67) that the accident arose out of and in the course of the employment. On the contrary, it has been frequently held, directly and indirectly, that there must be some evidence from which the conclusion can be drawn that the injuries did arise out of and in the course of the employment.” (Citing cases.) (Matter of Lorchitsky v. Gotham Folding Box Co., 230 N. Y. 8, 12.) Proof of the accident will give rise to the statutory presumption only where some connection appears between the accident and the employment. With rejection of the testimony of the claimant’s witnesses, possible connection between accident and employment disappears in this case. The decision of the Industrial Board dismissing the claim was, therefore, in accord with the evidence, and the Appellate Division in reversing that decision invaded the... field... in which, under the statute, the State Industrial Board was supreme. We do not now decide whether under the authority of Matter of Whitmyre v. International Business Machines Corp. (supra) the Industrial Board might not in the exercise of its continuing jurisdiction reconsider and change its decision dismissing the claim if it finds that such decision was erroneous. We decide only that no appellate court has power to direct it to change that decision.

The order of the Appellate Division and the award of the State Industrial Board should be reversed and the original determination of the State Industrial Board dismissing the claim reinstated, without costs.

Loughran, Finch, Sears, Lewis and Conwat, JJ., concur; Bippey, J., dissents.

Ordered accordingly.


text:
    Mae Duren, Respondent, v. City of Binghamton, Appellant.
    Argued June 11, 1940;
    decided July 24, 1940.

      Herman F. Nehlsen, Corporation Counsel (Samuel W. Bernstein of counsel), for appellant.
    The defendant, a municipal corporation, was engaged solely in the discharge of governmental functions in the operation and management of the Department of Welfare and cannot be held liable for any alleged negligence of the servants and employees necessarily engaged in the maintenance and furtherance of the uses to which said building was devoted. (Moest v. City of Buffalo, 116 App. Div. 657; Hughes v. County of Monroe, 147 N. Y. 49; Maxmilian v. Mayor, 62 N. Y. 160; Missano v. Mayor, 160 N. Y. 123; Finkelstein v. City of New York, 183 App. Div. 539; Wilcox v. City of Rochester, 190 N. Y. 137; Lefrois v. County of Monroe, 162 N. Y. 563; Murtha v. New York H. M. Col. & Flower Hospital, 228 N. Y. 183; Meyer v. City of New York, 162 Misc. Rep. 23; Corbett v. St. Vincent’s Industrial School, 177 N. Y. 16; Markey v. County of Queens, 154 N. Y. 675; Schlegel v. City of New York, 90 Misc. Rep. 285; City of Atlanta v. Garner, 56 Ga. App. 435; City of Kokomo v. Loy, 185 Ind. 18; Ford v. Independent School District, 223 Iowa, 795.)

      Robert O. Brink and Roy C. McHenry for respondent.
    The city acted in a proprietary capacity in allowing the W. P. A. to become its tenant and by assuming the duties and obligations of a landlord towards the W. P. A. and its employees who became invitees of the city; consequently, the city cannot be excused from liability on the ground that it was exercising a governmental function. (Van Dyke v. City of Utica, 203 App. Div. 26; Gillen v. Home Owners’ Loan Corp., 255 App. Div. 631; Jaked v. Board of Education, 198 App. Div. 113; Douglas v. Hollis, 86 N. H. 578; Worden v. New Bedford, 131 Mass. 23; Capital Amusement Co. v. Board of Common Council, 210 Ky 622; Board of Councilmen of City of Frankfort v. Pattie, 272 Ky. 343; Chafor v. City of Long Beach, 174 Cal. 478; Oeters v. City of New York, 270 N. Y. 364; Whittaker v. Village of Franklinville, 265 N. Y. 11; Seel v. City of New York, 179 App. Div. 659; Alexander v. City of New York, 194 App. Div. 161; Pitman v. City of New York, 141 App. Div. 670.) The defendant’s negligence has been established. (Warner v. New York, O. & W. Ry. Co., 209 App. Div. 211; White v. Lehigh Valley R. R. Co., 220 N. Y. 131; Lyons v. Rosenthal, 11 Hun, 46; Bowers v. City of Rome, 40 Hun, 635; Reilly v. Atlas Iron Const. Co., 3 App. Div. 363; 157 N. Y. 718; Huscher v. New York & Queens Electric Light & Power Co., 158 App. Div. 422.)
   Lehman, Ch. J.

The city of Binghamton voluntarily assisted a W. P. A. project as a convenient means of reducing the burden of providing relief to the indigent. It furnished space for the work and invited workers in the W. P. ,A. project to use a corridor in a building where the city stored supplies for distribution to persons requiring relief. .'The city owed a duty to these workers to exercise reasonable care in maintaining the corridor in a safe condition. The evidence sustains a finding that employees of the department of the city in charge of its relief work created a dangerous condition in the corridor by the negligent manner in which they piled up the supplies and that the plaintiff suffered severe injuries through such negligence.

Assuming for the purposes of the appeal that in providing relief for the indigent the city was performing a governmental duty imposed upon it by the State, and might claim immunity from liability for negligence of persons employed in carrying out that governmental duty, the immunity would not extend to the failure of the city to perform its duty to exercise reasonable care to maintain in a safe condition the corridor which it invited the W. P. A. workers to use. That is a duty voluntarily assumed towards persons who were not beneficiaries of the city relief work and for damages caused by a breach of that duty, the city is hable. (Cf. Engels v. City of New York, 281 N. Y. 650; Nathanson v. City of New York, 282 N. Y. 556; Whittaker v. Village of Franklinville, 265 N. Y. 11; Oeters v. City of New York, 270 N. Y. 364.) .

The judgment should be affirmed, with costs.

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

Judgment affirmed.