author: Rippey, J.

text:
    John Steitz, Respondent, v. Benedict Gifford, Appellant.

      Argued December 7, 1938;
    decided February 28, 1939.

      Irving I. Goldsmith, Monroe Collenburg and Adolph F. Bruenner for appellant.
    The courts below erred in permitting the respondent to recover for the profits which he claimed to have lost both on the corn he harvested and sold and even on the corn which he failed to harvest or sell. The jury should have been charged that the respondent was only entitled to recover the value of his own services while he was incapacitated. (Weir v. Union Ry. Co., 188 N. Y. 416; Gombert v. N. Y. C. & H. R. R. R. Co., 195 N. Y. 273; Walsh v. N. Y. C. & H. R. R. R. Co., 204 N. Y. 58; Masterton v. Village of Mt. Vernon, 58 N. Y. 391; Galanis v. Simon, 222 App. Div. 330; Hewlett v. Brooklyn Heights R. R. Co., 63 App. Div. 423.)

      Harold V. A. Drumm for respondent.
    The wrongdoer is responsible for the natural and proximate consequences of his conduct, and what are such consequences must be left for the determination of the jury. (Ehrgott v. Mayor, 96 N. Y. 264; Garrison v. Sun Printing & Pub. Assn., 207 N. Y. 1.) The true measure of damage was applied when all the facts are taken into consideration, and especially for the reason that the plaintiff’s earnings were chiefly personal, with only a small amount of invested capital, and that he did not have a foreman nor any one to run his business, and this fact is clearly emphasized for the reason that after his injuries he was unable to make the deliveries called for in his contracts. (Galanis v. Simon, 222 App. Div. 330; Humphrey v. Trustees of Columbia University, 228 App. Div. 168; Wakeman v. Wheeler & Wilson Mfg. Co., 101 N. Y. 205; Kronald v. City of New York, 186 N. Y. 40; Ehrgott v. Mayor, 96 N. Y. 264; Spreen v. Erie R. R. Co., 219 N. Y. 533.)
   Rippey, J.

The defendant appeals from a judgment of the Appellate Division, third department, affirming the judgment of the Supreme Court at a trial term for Columbia county in favor of the plaintiff for $4,470.55 damages arising out of an automobile accident. There were four causes of action set up in the complaint; the first cause was for personal injuries to the plaintiff; the second, for special damages arising out of his alleged inability to pursue profitably his special occupation because of his injuries; the third, for damages to his truck and trailer; and the fourth, for the loss of the load of produce he was transporting at the time of the accident. Defendant admitted liability for the accident and the only matter litigated was the question of damages. The only question open for consideration in this court is the propriety of the award of damages under the second cause of action.

The accident happened between nine and ten o’clock of the evening of August 12, 1933. Plaintiff was riding in a truck then being driven by an employee which was hauling a trailer loaded with sweet corn and pears en route to market to fulfill a contract for the sale of the corn, which contract required delivery not later than four o’clock on the morning of August 13th. Defendant’s car ran into the truck head-on and demolished it and plaintiff received various bodily injuries.

Plaintiff was the operator of some four hundred acres of land planted to a special variety of sweet corn, its planting having been so arranged as to permit of its ripening, harvesting and delivery at different times. The corn upon eighty acres of this land ripened and delivery to market was required to be made during the week of August 13th. The plaintiff was, by education, training and experience, an expert in his particular fine of work. He claimed that he had made arrangements to dispose of this eighty acres of sweet corn at two dollars per hundred ears. It was stipulated on the trial that there were eight hundred thousand ears of corn upon this particular tract. From the testimony of the plaintiff, the jury were authorized to find that various purchasers had agreed to accept delivery of at least 487,500 ears of this corn during the first five days of the week commencing August 13th at the price of two dollars per hundred ears, provided delivery could be made between three and four o’clock each morning of the day immediately following the picking for a large part thereof and before eight o’clock in the evening of the day of picking for the balance.

The load which plaintiff was delivering at the time of the accident (exclusive of the amount destroyed in the accident and otherwise compensated for) did not reach its destination. Plaintiff sold it upon the open market at a loss. Thereafter and during the week of August 13th, 99,600 ears of corn were harvested with such help as plaintiff was able to get, but none of it was delivered according to contract because, as plaintiff alleges and the jury has found, he was unable to attend to the deliveries himself and his men were unable to get the corn ready in time for delivery. All of that corn was sold upon the open market at a loss. The court laid down the rule of damages as to those items to be the difference between the amount the corn sold for and the contract price, if there were valid contracts for the sale thereof in which the price was feed.

There were some seven hundred thousand ears of corn that were not harvested. The evidence authorized_a finding that there were valid contracts for the sale and delivery at definite hours as above stated of 391,000 ears and that it was impossible for the plaintiff, because of his injuries, to manage and operate his project,^harvest the corn and fill the contracts. The jury were authorized to find upon the evidence that the business was of such’Ja nature and character that it was impossible for the plaintiff to employ any one else to manage it for him, particularly in view of the necessity for immediate action after the accident. As to this item the court stated that if plaintiff was entitled to recover at all, he was entitled to recover the difference between the contract price, if there were valid contracts and there was a contract price, and the cost of harvesting and delivery.

It was the contention of the defendant that no evidence as to any of these contracts was admissible, on the ground that the plaintiff could not recover for loss of profits. Motion was made at the close of the case to strike out all evidence on that subject, which motion was denied, and exception was taken. Defendant insisted that the rules of damages adopted by the court were erroneous and the court was requested to charge that if plaintiff was entitled to recover at all for any such loss, “he is entitled only to the value of his services, which would be determined by ascertaining what it would cost to hire someone to do the work — to do his work while he was incapacitated.” This request was declined and an exception taken. Upon the facts appearing in this case, taken in conjunction with the charge as a whole, we think that the rules of damages adopted by the trial court were correct and there was no error in refusing to strike out evidence in regard to the contracts.

In actions in tort, there are certain well-settled and universally recognized rules relating to damages recoverable, as the court substantially charged. The person responsible for the injury must respond for all damages resulting directly from and as a natural consequence of the wrongful act according to common experience and in the usual course of events, whether the damages could or could not have been foreseen by him. The damages cannot be remote, contingent or speculative. They need not be immediate, but need to be so near to the cause only that they may be reasonably traced to the event and be independent of other causes. The fact that they cannot be measured with absolute mathematical certainty does not bar substantial recovery if they may be approximately fixed. The damages must be compensatory only. Reasonable certainty as to the amount is all that is required (Curtis v. Rochester & Syracuse R. R. Co., 18 N. Y. 534). The mere fact that they are based upon loss of profits per se does not bar recovery (Griffin v. Colver, 16 N. Y. 489; Wakeman v. Wheeler & Wilson Mfg. Co., 101 N. Y. 205; Philadelphia, W. & B. R. R. Co. v. Howard, 13 How. [U. S.] 307), provided they are reasonably certain in amount and can be traced directly and with reasonable certainty to the accident, to the exclusion of other causes. While these rules are generally understood, difficulties arise in their application to the peculiar facts involved in a particular case before the court, and such a difficulty confronted the trial court in the case at bar. It cannot be said that a fixed, categorically stated and arbitrary rule from which no variation is permissible is applicable to every case where facts in different cases so greatly differ, and necessity requires the formulation of a rule that will fit the particular case without affecting the integrity of the above-stated general principles.

The solution of the question of whether the challenged evidence was admissible hinges upon a determination, as Judge Hubbs, after a review of the cases on the subject, pointed out in Galanis v. Simon (222 App. Div. 330, 333), of “ whether the plaintiff belongs to a class where his income depends upon his personal skill, taste or ability in the particular calling, profession or business in which he is engaged, or whether he is engaged in a line of work which could be done by some one else who could be hired to take his place.” Judge Werner in Walsh v. N. Y. C. & H. R. R. R. Co. (204 N. Y. 58, at p. 68) put it this way: Therefore, the first inquiry in each case is whether the loss sought to be recovered consists of profits which may not be proved, or earnings which may be proved. That is a question which depends upon the evidence in each instance.” If the facts indicate that the losses sought to be recovered were the uncertain and fluctuating increment of capital invested,” the rule of damages contended for by defendant would apply. On the other hand, where there is but a small amount of invested capital which was merely an incident or vehicle to the performance of services which were practically personal in their nature,” the evidence to which objection has been made would be admissible.

The facts in the case at bar bring it within the latter class. The business of plaintiff was specialized and depended upon his personal effort. The necessity for immediate exercise of that effort was present; time for harvesting and delivery of the corn could not be postponed. Contracts had been made which were required to be filled at specified times. The evidence indicated that it was impossible to procure anybody else who could do the work required for plaintiff. No effort was made to show the profits of the business nor was it claimed by plaintiff that any recovery could be based upon any such showing. The loss did not hinge upon the amount of invested capital as a predominant element in the production of income. Little if any of the land upon which the com was planted was owned by plaintiff. The evidence shows nothing more than a mere incidental investment of capital. The evidence was directed solely to the question of the loss of the contracts based upon the contract price less the price of harvesting the com and delivering it. The loss arose from plaintiff’s personal inability to operate his business for a single week, the week of August 13, 1933, on the first day of which the accident occurred. The loss naturally flowed from the accident. Cause and effect were clearly indicated and no cause, other than the accident, was shown. The loss was not remote, uncertain, contingent or speculative. In general, the admission of the evidence and the formulation of the rules as to damages were not out of harmony with the discussion in somewhat analogous cases (Masterton v. Village of Mount Vernon, 58 N. Y. 391; Weir v. Union Ry. Co., 188 N. Y. 416; Gombert v. N. Y. C. & H. R. R. R. Co., 195 N. Y. 273), in most of which cases recovery of damages was denied because loss was proven by evidence of profits accruing during previous years. The action1 of the trial court was fully sustained by the reasoning in other decisions (Ehrgott v. Mayor, 96 N. Y. 264; Kronold v. City of New York, 186 N. Y. 40; Walsh v. N. Y. C. & H. R. R. R. Co., supra; Spreen v. Erie R. R. Co., 219 N. Y. 533; Galanis v. Simon, supra; Humphrey v. Trustees of Columbia University, 228 App. Div. 168; Ball v. Pardy Construction Co., 108 Conn. 549; stone case with annotations, 63 A. L. R. 139). In view of the facts above recited and found by the jury on competent evidence, the rule that the measure of damages for the loss was the compensation ordinarily paid to others for rendering like services (LoSchiavo v. Northern Ohio T. & L. Co., 106 Ohio St. 61; 27 A. L. R. 424; Baxter v. Philadelphia & Reading Ry. Co., 264 Penn. St. 467; 9 A. L. R. 504, and like cases) has no application.

The judgment appealed from should be affirmed, with costs.

Crane, Ch. J., Lehman, Hubbs, Loughran and Finch, JJ., concur; O’Brien, J., taking no part.

Judgment affirmed.


source: Caselaw Access Project

author: Finch, J.

license: Public Domain

text:
    George Kirchner, Respondent, v. Marietta Muller et al., Defendants, and Marietta Muller, as Executrix and Trustee under the Will of Julius C. Muller, Deceased, Appellant.
    Argued December 7, 1938;
    decided February 28, 1939.

      L. W. Widdecombe and A. B. Widdecombe for appellant.
    Assuming that title, control and management were in the executors or trustees, as such, they are liable individually and not in their representative capacities. (Matter of Van Slooten v. Dodge, 145 N. Y. 327; Gratwick v. Smith, 202 App. Div. 600; Decillis v. Mascelli, 152 App. Div. 304; Hildreth v. Raffin, 141 App. Div. 77; Blum v. Dabritz, 39 Misc. Rep. 800; McCue v. Finck, 20 Misc. Rep. 506; Norling v. Allee, 13 N. Y. Supp. 791; 131 N. Y. 622; Trani v. Gerard, 181 App. Div. 387; Keating v. Stevenson, 21 App. Div. 604; Matter of Lathers, 137 Misc. Rep. 226; Moniot v. Jackson, 40 Misc. Rep. 197; Gillick v. Jackson, 40 Misc. Rep. 627.) The judgment may not be sustained upon the theory of avoidance of circuity of action. (Kellogg v. Church Charity Foundation, 128 App. Div. 214; Matter of Lathers, 137 Misc. Rep. 226; Norling v. Allee, 13 N. Y. Supp. 791; 131 N. Y. 622.)

      William A. Smith for respondent.
    The executors in both their representative and individual capacities were chargeable with negligence predicated upon the existence of an absolute nuisance in a public sidewalk. (Deshong v. City of New York, 176 N. Y. 475; Clifford v. Dam, 81 N. Y. 52; Canandaigua v. Foster, 156 N. Y. 354; Schubert v. Cowles, 31 App. Div. 418; Herman v. Josephsohn, 188 App. Div. 163; Becker v. Liscio, 223 App. Div. 698; Jawitz v. Hellinger, 86 Misc. Rep. 34; Adams v. Misena Realty Co., 239 App. Div. 633; Kilmer v. White, 254 N. Y. 64; Timlin v. Standard Oil Co., 126 N. Y. 514; Uggla v. Brokaw, 117 App. Div. 586.) The verdict against the estate or the executors in then representative capacity, as distinguished from their individual capacity, was proper under the unusual circumstances of the pleadings, and the demand made by appellant, as executrix, in her cross-complaint that the ultimate rights of the estate be determined. (Matters of Lathers, 137 Misc. Rep. 226.)
   Finch, J.

This is a personal injury action. Plaintiff was injured while walking in front of premises “ owned and controlled by the defendants Muller.” Thirty-eight years before the accident the then owner, without license or permit, instituted a system of draining the rain water from the roof of the building, by conducting it through a pipe at the side of the building and thence through a conduit or drain across the sidewalk to the curb. This conduit was merely a cut in the sidewalk which had as a cover a plank which was loosely laid on top, resting upon flanges which kept it level with the sidewalk. Bricks were placed near the curb so as further to support the plank. There was an opening between the sidewalk and the edge of the plank, of about one-eighth to one-quarter of an inch, in order to permit its removal for cleaning and inspection of the drain underneath. Concededly this plank was never fastened to the building itself or to the sidewalk. There was evidence that at the time of the accident the plank projected beyond the curb into the street for a distance of approximately six inches. While plaintiff was walking in front of the premises a truck, owned by defendant Parish Produce, Inc., attempted to park along the curb. A wheel of the truck came to rest upon the projecting portion of the plank, causing it to rise at an angle of forty-five degrees and strike plaintiff.

At the time of the accident, Julius C. Muller, the owner of the premises, who had constructed the drain, was dead, having died in 1926. In his will he had devised the premises to his executors in trust, to collect the income and profits and, after paying taxes and expenses of maintenance and repair, to use the net for the board, care and maintenance of an incompetent daughter as long as she should live, and to pay any balance to his wife, the defendant Marietta Muller, for life. Marietta Muller was an executrix under the will, the other executor being a son, Charles H. Muller. Marietta Muller was served, but Charles H. Muller, who was in California at the time, was not served. Service was also made on Helen Muller, a daughter, who had a remainder interest in the premises, and upon the Parish Produce, Inc. The complaint named Marietta Muller as a defendant individually and as executrix and trustee of the estate of Julius C. Muller. Marietta Muller served an answer individually, in which, in addition to general denials, she asked for affirmative relief under section 264 of the Civil Practice Act against defendant Parish Produce, Inc., praying that the ultimate rights between these parties be determined, and that she have judgment over against Parish Produce, Inc., for any sum which might be recovered by plaintiff against her. As executrix and trustee she put in a similar answer and asked for a like judgment over against Parish Produce, Inc. The same attorney represented Marietta Muller individually and as executrix and trustee.

From the record of what occurred at the trial, it would appear that the sole issue in the mind of the jury was liability for the injuries which the plaintiff suffered, as between the Mullers on the one hand, and the defendant Parish Produce, Inc., on the other. Except for a motion to dismiss at the end of plaintiff’s case, as against the defendant Marietta Muller as executrix and trustee, no distinction appears to have been made between the liability of Marietta Muller individually and the Muller Estate as represented by Marietta Muller as executrix and trustee. At the close of the entire case, the attorney for the Mullers, in renewing the motions to dismiss which were made at the close of plaintiff’s case, urged that the building was in control of a lessee, namely, the Muller Hardware Company, and said: “ On those facts I say that the plaintiff has no cause of action against the defendants Muller, it not appearing that the defendants Muller were in the control of the building; the lessee was in entire control of it.” Again, just before the summation, the same attorney said: “ Before I begin my summation * * * I should have asked for the direction of a verdict in favor of the defendants I represent.” The court charged the jury: If they find this accident was due solely to the negligence of this truck driver, their verdict should be against this defendant Parish Produce. If they find that it was due solely to the negligence of Muller it should be against Muller. If they find it should be against the two, and it was due to the negligence of both defendants, they may bring in a verdict against both defendants.” The jury rendered the following verdict: The Foreman: We find the defendant Muller guilty of negligence. The Court: You find the defendant Muller — The Foreman: Muller estate. The Court: — guilty of negligence. You find for the plaintiff — The Foreman: A verdict of $5,000. Court Clerk Lynch: You find a verdict for the plaintiff in the sum of $5,000, against the defendant Muller; is that right? The Foreman: Bight. The Court: Muller estate. The Foreman: The Muller estate. The Court: Is that a unanimous verdict? The Foreman: There are ten to two. The Court: Ten to two — The Foreman: Everyone agrees on the amount, and ten agree on the negligence.”

The jury found that defendant Parish Produce, Inc., had not been negligent, and the motion for judgment over against that company was denied. In moving to set aside the verdict, the attorney for the Mullers said: “ * * * and I also move for the direction of a verdict in favor of the defendants Muller whom I represent against the Parish Produce Company * * The court took under advisement the motion for the direction of a verdict against Parish Produce, Inc. In denying this motion the court treated the issue as between the defendants Muller and the defendant Parish Produce, Inc., saying: Defendant Mullers’ motion at the end of trial to set aside the verdict and for the direction of a verdict against Parish Produce Company, Incorporated, denied. * * * It is for the jury to say under the circumstances whether either or both of the defendants were negligent.”

The general rule as contended for by appellant is that for their torts trustees or executors are liable in their individual, and not in their representative, capacity. (Matter of Van Slooten v. Dodge, 145 N. Y. 327; Norling v. Allee, 10 N. Y. Supp. 47; later appeal to same effect, 13 N. Y. Supp. 791; affd., 131 N. Y. 622; Keating v. Stevenson, 21 App. Div. 604; Trani v. Gerard, 181 App. Div. 387; Moniot v. Jackson, 40 Misc. Rep. 197; Matter of Lathers, 137 Misc. Rep. 226.) The same rule holds true in almost all of the States. (7 A. L. R. 408; 14 id. 371; 44 id. 627.) Judgments obtained against executors or trustees are collectible out of their private property, and not out of the trust or estate assets. Although the question appears to have arisen infrequently, the trustee or executor has been held entitled to reimbursement from the estate where he was free from willful misconduct in the tort which occurred during his administration of the estate. (American Law Institute, Restatement of the Law of Trusts, § 247; 3 Bogert on The Law of Trusts and Trustees, § 734; Keating v. Stevenson, 21 App. Div. 604; Matter of Lathers, 137 Misc. Rep. 226, 233. See Kellogg v. Church Charity Foundation, 128 App. Div. 214, 217.) A few States have gone so far as to hold that where a trustee or executor would be entitled to reimbursement, the injured third party may sue him in his representative capacity, on the ground that thereby circuity of action may be avoided. (Ewing v. Feley, 115 Tex. 222. Cf. Ireland v. Bowman & Cockrell, 130 Ky. 153; Smith v. Coleman, 100 Fla. 1707; Miller v. Smythe, 92 Ga. 154; Wright v. Caney River Ry. Co., 151 N. C. 529.) No New York authorities are found supporting this procedure. Such a procedure would involve a trial in the same action of both the tort liability and whether the nature of the tort was such as to entitle the trustees or executors to reimbursement, out of the estate, which might entail an undesirable clash of interests between the trustee in his individual capacity and in his representative capacity. In Matter of Raybould ([1900] 1 Ch. 199) it was held that where a judgment was recovered by a third party against a trustee for a tort com-mi tied in the administration of the trust, the third party, where his judgment against the trustee proves uncollectible, may then proceed directly against the trust estate. Whether such procedure would be sanctioned in this State need not now be decided. (See Restatement of the Law of Trusts, §§ 267, 268.)

The respondent urges that the estate and Marietta Muller, as executrix and trustee, may be held hable on the theory that there was a waiver of the defense of non-liability in a representative capacity. This was the ground upon which a majority of the Appellate Division sustained the judgment. Assuming, without passing upon the question, that an attorney may waive such defense, we find there was no such waiver. At the close of plaintiff’s case, the attorney for Marietta Muller made the following motion: If the Court please, I move to dismiss the complaint as against Marietta Muller as executrix and also as against Marietta Muller as trustee on the ground that the plaintiff has failed to plead or prove a cause of action against her in either representative capacity.”

This was denied and exception duly taken. He then moved to dismiss as against all defendants, in their representative as well as in their individual capacities,” on the ground that plaintiff had failed to prove a case, that plaintiff was guilty of contributory negligence, lack of notice of the condition on the part of the defendant, and absence of proximate cause. At the close of the entire case these motions were renewed and denied, and exception was duly taken.

This did not constitute a waiver of election. Proper motions to dismiss had been made and denied. Exceptions had been taken.

Nor did the croso-claim over against the owner of the truck, Parish Produce, Inc., under section 264 of the Civil Practice Act, constitute a waiver. It was merely an assertion that if liability were imposed on the defendants, they claimed a right over against the truck owner. It cannot reasonably be construed as an admission of liability or the relinquishment of any right or defense.

Must we then dismiss the complaint and deny any relief to this plaintiff who has been injured grievously while a pedestrian upon the sidewalk, without any fault on his part, through the proven negligence of those in control_of the premises in question?

While as shown above the judgment may not lie as against the Muller ' estate and Marietta Muller as executrix and trustee, yet we. have a finding by the jury of negligence against the individual defendant Marietta Muller, which was changed under the direction of the learned justice to a finding against the Muller estate. This was error.

Moreover, in an action for negligence against a trustee or executor in possession or control of premises, it has been held that although an action may be entitled against defendants-executors of a last will and testament, judgment may be entered against these defendants individually. (Donahue v. Kendall, 50 N. Y. Super. Ct. 386, 388 [18 Jones & Spencer]; affd., 98 N. Y. 635.) There the court said: As to the plaintiff, whatever was the title or right of the defendants, they had an obligation to her, because as natural persons they were in control of the premises and managed them, and were hable for any negligence on their part.” Also it has been stated as the general rule in most jurisdictions that where a trustee is sued as trustee, a judgment may be entered against the defendant individually and the words “ as trustee ” may be treated as surplusage. (3 Bogert on The Law of Trusts and Trustees, p. 2161, cit. Mass. & Va. cases; see also Bannigan v. Woodbury, 158 Mich. 206; Hampton v. Foster, 127 Fed. Rep. 468.) This same principle has been applied to permit an amendment of the pleadings so as to change the capacity in which a defendant is sued, the court saying: “ It merely changes the capacity in which the same person is sought to be charged * * *. The court in the case supposed is deemed to have acquired jurisdiction over the person of the individual served and may continue to exercise that jurisdiction over him in any capacity in which the plaintiff seeks to render him liable, provided only that he in his own person is the only one called upon to litigate the issue proffered by the declaration.” (Boyd v. U. S. Mortgage & Trust Co., 187 N. Y. 262, 270, 272.)

However, when a plaintiff declares upon a contract instead of upon negligence, a different rule may have been applied, particularly where the defendants are sued only in a representative capacity and there has been no attempt to amend the pleadings or where the defendant had relied upon the suit being invalid because brought in a representative capacity and, therefore, had had no witnesses available. In such case the defendant was denied an opportunity to call witnesses in his behalf or to defend himself. (O’Brien v. Jackson, 167 N. Y. 31; Austin v. Monro, 47 N. Y. 360.) None of these difficulties presented themselves in the case at bar. As the defendant Marietta Muller was made a party in both capacities, and the trial proceeded against her not only as executrix and trustee but also individually, she had her full day in court in both capacities.

The judgment in so far as it affects the Muller estate and Marietta Muller as executrix and trustee should be amended so as to read solely as against Marietta Muller, individually, without costs.

The judgments should be modified in accordance with this opinion and as so modified affirmed, without costs.

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

Judgment accordingly.


author: Loughran, J.

text:
    Elizabeth Karlin, Respondent, v. Abbott A. Karlin, Appellant.

      Argued January 4, 1939;
    decided February 28, 1939.

      Max J. Le Boyer for appellant.
    The Special Term had authority to amend the judgment nunc pro tune to conform with the contract provisions. (Walker v. Walker, 155 N. Y. 80; Civ. Prac. Act, § 1170, in effect in 1924; Fox v. Fox, 263 N. Y. 68; Kirkbride v. Van Note, 275 N. Y. 244; Harris v. Harris, 259 N. Y. 334; Waddey v. Waddey, 168 Misc. Rep. 904; Windle v. Heard, 254 App. Div. 875; Ostrin v. Posner, 127 Misc. Rep. 313; Van Ness v. Ransom, 164 App. Div. 483; Parsons v. Macfarlane, 220 N. Y. 605; Schnitzer v. Buerger, 237 App. Div. 622.) The provisions of the written contract between the parties, despite the provisions of the original divorce decree, must be respected until the agreement is set aside. (Galusha v. Galusha, 116 N. Y. 635; Gray v. Gray, 149 Misc. Rep. 273; Pye v. Pye, 167 App. Div. 951; Cain v. Cain, 188 App. Div. 780; Kunker v. Kunker, 230 App. Div. 641; Aldrich v. Aldrich, 220 App. Div. 555.)

      Alex B. Greenberg for respondent.
    The Special Term had no power to amend the decree of divorce nunc pro tune, or otherwise, in the absence of reservation of power therein to do so. (Fox v. Fox, 263 N. Y. 68; People ex rel. Moss v. Board of Supervisors, 221 N. Y. 367; Walker v. Walker, 155 N. Y. 77; Livingston v. Livingston, 173 N. Y. 377; Krauss v. Krauss, 127 App. Div. 740; Goodsell v. Goodsell, 82 App. Div. 65; Livingston v. Livingston, 46 App. Div. 18; 74 App. Div. 261; Bamboschek v. Bamboschek, 150 Misc. Rep. 885; Crawford v. Crawford, 129 Misc. Rep. 683; Matthews v. Matthews, 128 Misc. Rep. 425.) Since the agreement was not approved by the court and embodied in the decree of divorce it did not supersede the decree. (Hamlin v. Hamlin, 129 Misc. Rep. 263; 223 App. Div. 810; Gewirtz v. Gewirtz, 189 App. Div. 483; Hamlin v. Hamlin, 224 App. Div. 168; Galusha v. Galusha, 116 N. Y. 635; Lehmann v. Lehmann, 137 Misc. Rep. 8.)
   Loughran, J.

The plaintiff wife sued her husband for a divorce. An interlocutory judgment entered in her favor November 3, 1924, directed him to pay to her $15 per week for the support of herself and their child. In January, 1925, the parties entered into a written agreement whereby the wife accepted $1,000 “ in lieu of her alimony ” and the husband undertook to pay to her $6 per week for the support of the child. Thereafter and on February 4, 1925, the interlocutory judgment of divorce became a final judgment in accordance with a provision made therein for that eventuality.

This judgment having remained meantime unmodified, the wife, in December, 1936, brought suit thereon against the husband in the State of New Jersey. In the interim from February, 1925, he had paid.to her only $6 per week in reliance upon their agreement of January, 1925, By the New Jersey action, she sought recovery of the difference between the aggregate of those payments and the total sum to which she was entitled on the face of the judgment — a difference fixed by her at $5,590.

Confronted by that litigation in New Jersey, the husband moved in this action for an order amending the support provisions of the judgment so as to conform them nunc pro tune to the agreement made by the parties in January, 1925. This relief was granted by the Special Term as of February 4, 1925, the date when the judgment became final. On appeal by the wife to the Appellate Division, the order was modified by denying so much of the motion as sought relief nunc pro tune. This is an appeal as of right by the husband from that modification of the final judgment of divorce. (See Powers v. Powers, 214 N. Y. 660.)

The order of modification is silent as to whether it was made on the law or on the facts. The cases cited by the Appellate Division in its memorandum opinion (Livingston v. Livingston, 173 N. Y. 377, and Krauss v. Krauss, 127 App. Div. 740) suggest that the order of the Special Term was modified on the law alone and counsel for the wife takes that position. He contends that the Special Term was wholly without power to amend (for the future or for the past) the support provisions of the judgment, since that power was not thereby reserved.

To this contention of complete absence of jurisdiction, the plain answer is that, when the judgment of divorce was entered in 1924, section 1170 of the Civil Practice Act provided as follows: “ Where an action for divorce * * * is brought by either husband or wife, the court * * * must give, either in the final judgment * * * or * * * before final judgment, such directions as justice requires, between the parties, for the custody, care, education, and maintenance of any of the children of the marriage, and where the action is brought by the wife, for the support of the plaintiff. The court, by order, upon the application of either party to the action, * * * after due notice to the other, * * * at any time after final judgment, may annul, vary or modify such directions. * * * ”

By force of this statutory continuation of jurisdiction, the Special Term here had power in its discretion to annul or modify the directions given by this final judgment for the support of the wife. “ The effect of the statute is to write a reservation into every final judgment of divorce. The jurisdiction of the court over the parties and over the incidental subject-matter is prolonged; and to that extent the action may be said to be pending within the meaning and intent of section 1169 of the Civil Practice Act.” (Fox v. Fox, 263 N. Y. 68, 70.) It follows, we think, that the Special Term was warranted in its amendment of the judgment nunc pro tune as of the date it became final, so as to square it with what was then the obligation of the husband under the agreement made by the parties in January, 1925. (See Galusha v. Galusha, 116 N. Y. 635.) Livingston v. Livingston (ubi supra) holds nothing to the contrary. The judgment in that case was entered before the enactment of the statute we have quoted. Cary v. Cary (168 App. Div. 939; 217 N. Y. 670), a case decided on the authority of Krauss v. Krauss (ubi supra), was overruled by Kirk-bride v. Van Note (275 N. Y. 244).

The Special Term clearly did not abuse the discretion which we hold was thus committed to the court by the statute. In a word, the order of the Special Term was not unauthorized as matter of law.

If, on the other hand, the case is that the Appellate Division held on the facts that the Special Term erroneously exercised its discretion, then we have jurisdiction to review the new findings which the order of modification implies. (Matter of Flagler, 248 N. Y. 415.) .In that case, we are disposed to think that the weight of the evidence was with the SpecialjTerm.

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

Crane, Ch. J., Lehman, O'Brien, Hubbs, Finch and Rippey, JJ., concur.

Ordered accordingly.


text:
    In the Matter of the Estate of Alwin Juedel, Deceased. John Heitman, as Executor of Alwin Juedel, Deceased, Appellant; Doris Harmon et al., Respondents.
    Argued January 5, 1939;
    decided February 28, 1939.

      Abraham Lillienthal and Leon Finkelstein for appellant.
    The withdrawal by the respondent Doris Harmon of the greater part of the fund in the joint account during the lifetime of the deceased destroyed the joint tenancy as to the money withdrawn. It left only a rebuttal presumption of an interest in the money so withdrawn and there was evidence sufficient to rebut the presumption. (Moskowitz v. Marrow, 251 N. Y. 380; Marrow v. Moskowitz, 255 N. Y. 219; Matter of Porianda, 256 N. Y. 423; Matter of Newcomb, 192 N. Y. 238; Fallon v. Swackhamer, 226 N. Y. 444; McKeon v. Van Slyck, 223 N. Y. 392.) The respondents are estopped by their conduct from claiming the benefit of the presumption •— the rule of presumption should not be permitted to perpetrate a fraud. (Matter of McKelway, 221 N. Y. 15; Thompson v. Simpson, 128 N. Y. 271; Dulberg v. Equitable Life Assur. Soc., 277 N. Y. 17; First Nat. Bank v. Lafayette Trust Co., 85 Misc. Rep. 341; 167 App. Div. 940; 216 N. Y. 691.)

      Arthur Hutter and George Weiss for respondents.
    The making of the joint tenant deposit is conclusive evidence, in this proceeding, of the intention of both to vest title in the survivor, as to the balance after death. As to the amounts withdrawn, the presumption may be overcome by competent evidence that the deceased’s intention, at the time of opening the account, was not to vest title in his daughter. (Cons. Laws, ch. 2, § 239, subd. 3; Marrow v. Moskowitz, 255 N. Y. 219; Matter of Porianda, 256 N. Y. 423; Matter of Levinsky, 145 Misc. Rep. 318; Matter of Massey, 143 Misc. Rep. 794; Matter of Buckler, 227 App. Div. 146; Matter of Curran, 153 Misc. Rep. 630.) Appellant’s proof does not establish that the tenancy created at the opening of the account was in truth something different from the tenancy defined by the statute. (Matter of Brogan, 165 Misc. Rep. 111; Kelly v. Beers, 194 N. Y. 49.)
   Loughran, J.

Prior to February 3, 1937, Alwin Juedel had on deposit with the Lincoln Savings Bank of Brooklyn, $5,278.52 in an account standing in his own name. On that date the deposit was transferred by the bank to a new account in the name of Mr. Juedel and his daughter, Doris Harmon, “ for either or survivor.”

Mr. Juedel died December 25, 1937. This proceeding was brought by his executor to compel discovery of $5,000 which in the preceding April had been withdrawn from the joint account by Doris Harmon. (See Surr. Ct. Act, §§ 205, 206.) George I. Harmon, the husband of Doris, was made a respondent with her, she having redeposited $2,500 of that sum in her name as trustee for him.

Subdivision 3 of section 239 of the Banking Law (Cons. Laws, ch. 2) was invoked by the respondents. It is thereby provided: When a deposit shall be made by any person in the names of such depositor and another person and in form to be paid to either or the survivor of them, such deposit and any additions thereto made by either of such persons after the making thereof shall become the property of such persons as joint tenants, and, together with all dividends credited thereon shall be held for the exclusive use of such persons and may be paid to either during the lifetime of both or to the survivor after the death of one of them, * * * The making of the deposit in such form shall, in the absence of fraud or undue influence, be conclusive evidence, in any action or proceeding to which either the savings bank or the surviving depositor is a party, of the intention of both depositors to vest title to such deposit and the additions thereto in such survivor.”

These provisions are part of article VI of the statute which relates to savings banks. (Cf. § 134, subd. 3.) The effect thereof is to affix to a savings bank account, when opened in the form so prescribed, a presumption that the interest of the depositors is that of joint tenants. “ Upon the death of one of the depositors, this presmnption becomes conclusive in favor of the survivor in respect of any moneys then left in the account. It continues to be a mere presumption in respect of any moneys previously withdrawn.” (Marrow v. Moskowitz, 255 N. Y. 219, 221.) The $5,000 fund drawn out by Doris Harmon was thus in the first place to be taken to be her own, in virtue of her presupposed status as surviving joint tenant. The executor, however, had the right to come forward with proof sufficient to overcome this statutory initial imputation of title against him. As to these moneys that had been withdrawn in the testator’s lifetime, the statute still left room for competent evidence “ that the tenancy created at the opening of the account was in truth something different from the tenancy defined by the presumption.” (Marrow v. Moskowitz, supra, p. 222.)

In their answer to the executor’s petition, the respondents asserted ownership of the entire deposit by reason of the fact that on or about February 3rd, 1937, the deceased, Alwin Juedel, opened a joint account in his own name and the name of the respondent Doris Harmon in the Lincoln Savings Bank;” and Doris Harmon thereby alleged that the account was opened for the purpose of making a gift to her in the sum of $5,278.52.” The executor introduced evidence that when the testator’s will was read to his four children, Doris Harmon said: Well, there is another account in the Lincoln Savings Bank for $5,300, $5,000 of which is a gift from father to George and I. It was put in a joint account in February. He put it in our names and he said that if anything happened he wanted me and George to have the money, so when I heard he was going to die, I opened a joint account in George’s name and mine.” No evidence was offered by the respondents.

They were directed by the Surrogate to pay over to the executor the original amount of the joint account. His decree recites the absence of proof of any gift to Doris Harmon and his conclusion that the testator never intended to create a joint account between himself and her. On appeal by the respondents, the Appellate Division reversed the Surrogate on the law and dismissed this proceeding on the ground that nothing in the record justified an inference that the joint account was not what in fact it purported to be. The controversy is now before us on appeal by the executor.

No attempt is made to sustain the Surrogate’s award to the estate of the moneys that were left in the account at the testator’s death. Concededly the statutory presumption that Doris Harmon was a joint tenant with the testator then became conclusive in her favor in respect of the balance ■undrawn, with the result that she was at all events entitled thereto as survivor.

As to the $5,000 withdrawal: In its memorandum the Appellate Division said there was no proof at all respecting the manner in which the joint account was opened. This is not the case. The record contains as an exhibit the written direction of the testator to the bank to transfer the balance in his individual account to a new account and to insert the name of Doris Harmon, my daughter so that said account is made payable to either of us or to the survivor.” This evidently conscious acquiescence of the testator in the statutory form of the new account was a substantial fact on the side of a survivorship title of Doris Harmon as joint tenant of the moneys she had taken to herself. But on the other side, were the statements and conduct of the party respondent Doris Harmon, to which we have referred. We cannot say that the Surrogate was not warranted in treating these items of evidence as admissions by her that neither she nor the testator ever intended that the opening of the account on the statutory pattern was then and there and without more to endow her with a vested property interest in the deposited moneys as against him. (Matter of Porianda, 256 N. Y. 423.) In respect of the sum withdrawn, the statutory presumption to the contrary was after all a rebuttable implication merely, that is to say, an implication which imputed to the form of the deposit no more than the prima facie consequence of title in Doris Harmon as survivor. (Moskowitz v. Marrow, 251 N. Y. 380.) This presumption was removed from the case when the Surrogate found upon sufficient evidence that the relationship professed by the joint account was not in reality the tenancy of which the statute speaks. We cannot agree with the Appellate Division that the record dictates the opposite conclusion as matter of law.

Except for the inclusion of the amount remaining in the account when the testator died, the Surrogate’s direction for payment over by the respondents to the executor was validly made.

The order of the Appellate Division should be reversed, and the decree of the Surrogate’s Court modified in accordance with this opinion, and as so modified affirmed, with costs in all courts to all parties appearing separately payable out of the estate.

Crane, Ch. J., O’Brien, Hubbs, Finch and Bippey, JJ,, concur; Lehman, J., taking no part.

Ordered accordingly.


author: Loughran, J. Finch, J.

text:
    Max R. Engel, Respondent, v. Guaranty Trust Company of New York, as Trustee, Appellant.
    Submitted December 2, 1938;
    decided February 28, 1939.

      I. Howard Lehman, Mortimer Brenner and Morris L. Levinson for appellant.
    The trust instrument creates remainder interests in plaintiff’s distributees and they are beneficially interested in the trust. (Doctor v. Hughes, 225 N. Y. 305; Whittemore v. Equitable Trust Co., 250 N. Y. 298; Schoellkopf v. Marine Trust Co., 267 N. Y. 358; Davies v. City Bank Farmers Trust Co., 248 App. Div. 380; Beam v. Central Hanover Bank & Trust Co., 248 App. Div. 182; Crackanthorpe v. Sickles, 156 App. Div. 753; Court v. Bankers Trust Co., 160 N. Y. Supp. 477; 172 App. Div. 955; 221 N. Y. 608; Hammond v. Chemung Canal Trust Co., 141 Misc. Rep. 158.) If the settlor’s distributees have beneficial interests in the principal of the trust, it may not now be revoked upon the consent of the former wife and the brother. (Williams v. Sage, 180 App. Div. 1; Schoellkopf v. Marine Trust Co., 267 N. Y. 358; Clowe v. Seavey, 208 N. Y. 496; Kent v. Church of St. Michael, 136 N. Y. 10; Monarque v. Monarque, 80 N. Y. 320; Tonnele v. Wetmore, 195 N. Y. 436; Newton v. Hunt, 134 App. Div. 325; 201 N. Y. 599; Downey v. Seib, 185 N. Y. 427.)

      Hugo Pollock for respondent.
    Under the trust instrument the grantor and his former wife are the only persons beneficially interested in the trust, and their joint consent to revocation constitutes compliance with section 23 of the Personal Property Law (Cons. Laws, ch. 41). (City Bank Farmers Trust Co. v. Miller, 278 N. Y. 134; Whittemore v. Equitable Trust Co., 162 App. Div. 607; Doctor v. Hughes, 225 N. Y. 305; Berlenbach v. Chemical Bank & Trust Co., 235 App. Div. 170; 260 N. Y. 539.) If it be held that the trust instrument created a contingent remainder in favor of any person other than settlor’s former wife, the consent to revocation by his brother is, nevertheless, sufficient compliance with the provisions of section 23 of the Personal Property Law. (Corbett v. Bank of New York & Trust Co., 229 App. Div. 570; Thatcher v. Empire Trust Co., 243 App. Div. 430; Beam v. Central Hanover Bank & Trust Co., 248 App. Div. 182.)
   Loughran, J.

This controversy was submitted to the Appellate Division upon agreed facts pursuant to Civil Practice Act, sections 546-548.

On January 31, 1934, the plaintiff, as grantor, transferred and delivered certain securities to the defendant, as trustee. The trust agreement directed that the net income be paid to the grantor during his life and authorized the trustee at any time and from time to time to make payments to him from the trust principal of not more than an aggregate of $15,000.

It further provided: Upon the death of the Grantor, the trust shall terminate and the principal thereof shall be paid to Margaret V. Engel, wife of the Grantor, provided she survive the Grantor. In the event that the said Margaret V. Engel shall not survive the Grantor, then upon the death of the Grantor the principal of said trust shall be paid over and delivered to such person or persons and in such amount or amounts as may be validly provided by the Grantor in such Last Will and Testament of bis as may be duly admitted to probate, but if the Grantor shall die without making valid provision for the distribution thereof by duly probated Last Will and Testament, then the principal of said trust shall be paid over and delivered to such person or persons, and in such shares, interests and proportions as the same would have been distributable if the Grantor had been the owner thereof at the time of his death and had died intestate.”

The grantor notified the trustee that he had revoked the trust pursuant to section 23 of the Personal Property Law (Cons. Laws, ch. 41) which provides: Upon the written consent of all the persons beneficially interested in a trust in personal property or any part thereof heretofore or hereafter created, the creator of such trust may revoke the same as to the whole or such part thereof, and thereupon the estate of the trustee shall cease in the whole or such part thereof.”

Margaret V. Engel and the grantor are now divorced. One of the agreed facts is that James Mack Engel, a brother of the grantor, is his only present next of kin. 'xAnother is: “ No persons other than the Said Margaret V. Engel and said James Mack Engel would be entitled under the intestacy laws of the State of New York to share in the distribution of the personal property of the plaintiff, were the plaintiff at this time to die intestate.”^ It is also stipulated that both Margaret V. Engel and James Mack Engel are of full age and that both have validly consented that the trust be revoked and the principal thereof transferred and paid over to the plaintiff-grantor.

“ The controversy submitted for decision is whether, upon the foregoing facts, the plaintiff is entitled to judgment revoking the said agreement of trust dated January 31, 1934, and directing the defendant to deliver to him the assets in its possession as trustee thereunder, upon payment of its lawful commissions and expenses.” The Appellate Division gave such judgment to the plaintiff-grantor, taking the ground that the trust agreement did not express his purpose to create remainders in those who will be his distributees, and that contrariwise it did express his purpose to keep back a reversion for himself.

We think the reasoning of our opinion in Whittemore v. Equitable Trust Co. (250 N. Y. 298) commits us to just the opposite conclusion. There the question was whether a trust agreement reserved a reversion to the settlors or created remainders in their distributees. We held the latter alternative was the one intended. The chief reason for that view was the circumstance that the only provision which the settlors made for control by them of the trust principal gave them no power save that of testamentary disposition thereof. (Id. 301, 303.)

The instrument now before us likewise fails to provide for an assignment of the trust principal by the grantor. Its terms, moreover, admit of exercise of the reserved power of testamentary appointment only in the event of the grantor’s survivorship of the remainderman, Margaret V. Engel. Significant, too, is the omission of any provision for return of the trust principal to this grantor beyond the $15,000 which he expressly retained the right to draw down. In this last aspect (though the total value of the corpus does not appear), the purpose of the grantor fully to divest himself of any other reversionary interest in this trust is clearer to a degree than was the like intent of the settlors which the court found in the Whittemore case — for there the settlors were to have the principal again on their survival of both fife beneficiaries.

It is true that our opinion in the Whittemore case assumed that transfers of personal property are embraced by the ancient rule “ that a reservation to the heirs of the grantor is equivalent to the reservation of a reversion to the grantor himself.” (Doctor v. Hughes, 225 N. Y. 305, 310.) But this rule (as the Doctor and Whittemore cases show) is with us no more than a prima jade precept of construction which may serve to point the intent of the author, when the interpretation of a writing like this trust agreement is not otherwise plain. Inasmuch as for us that rule has now no other effect, it must give place to a sufficient expression by a grantor of his purpose to make a gift of a remainder to those who will be his distributees. We find in the present instance an adequate disclosure by the trust agreement of a purpose in the mind of this grantor to vest his presumptive heirs with rights which it would be beyond his power to defeat, except by testamentary provision.

Although it is not an agreed fact that persons now living (other than James Mack Engel) are blood relatives of the grantor, it is quite impossible to make a different assumption. Every human being born in lawful wedlock has an ancestry that burgeons out into vast numbers, when you get into the higher branches of his family tree. From any one of the ancestors of this grantor may stem another family line that is related to him by consanguinity. This whole group has a contingent remainder created by this trust indenture. “ They take as purchasers through a beneficial right derived from the trust instrument, and all who have a share in that right and who may, by survival or other event, become members of the class entitled to the remainder have a beneficial interest in the trust which cannot be destroyed without their consent.” (Schoellkopf v. Marine Trust Co., 267 N. Y. 358, 363.) It is unnecessary to say whether there is any significance in the possibility that among that class may also be persons who are yet unborn.

Should it be thought that we have here- let counsels of rigor have their way, it may also be called to mind that a solemn document is to be faithfully construed according to its terms as written by the parties.

The judgment of the Appellate Division should be reversed and judgment directed for the defendant Guaranty Trust Company of New York as trustee, etc., in accordance with this opinion, with costs payable out of the trust.

Finch, J.

(dissenting). In accordance with the provisions of the Personal Property Law (§23) a trust in personal property may be revoked by the creator upon the written consent of all persons beneficially interested therein. The question here presented is whether all those beneficially interested in the trust have consented. The settlor and his former wife, the life tenant, have duly consented. By way of abundant caution the only next of kin of the settlor has likewise duly consented.

No rule of property has been better established over the course of the years than that a trust to pay the income thereof to the grantor and the principal upon his death to those who would take in intestacy unless otherwise appointed by the will of the grantor effects merely a reversion in the grantor and the next of kin take by descent and not by remainder. (Doctor v. Hughes, 225 N. Y. 305; Berlenbach v. Chemical Bank & Trust Co., 235 App. Div. 170; affd., 260 N. Y. 539; City Bank Farmers Trust Co. v. Miller, 278 N. Y. 134.)

The facts are clear. The trust instrument, as pointed out by the Appellate Division in an opinion carefully written, plainly shows that the settlor established a life trust for himself, a remainder to Margaret, if she survives him, and a reversion in himself should Margaret predecease him. Beyond this plaintiff made no disposition of his estate. Outside of his former wife Margaret who consents, the settlor alone has the power to dispose of the property by will or if he dies without so doing, it goes to his next of kin. In either event it would go as his property. (City Bank Farmers Trust Co. v. Miller, supra.) A further indication that the grantor intended to retain a reversion in the principal subject only to the remainder interest of Margaret is the provision in the agreement giving the grantor the right to withdraw from the principal a sum not exceeding $15,000.

In Schoellkopf v. Marine Trust Co (267 N. Y. 358, 363) we said: “ If the settlor had retained a reversion which would pass upon his death to his ‘ heirs ’ or next of kin, then no consent would be necessary from them. They would then take, * * * through succession to the interest of the settlor and he could consent to the destruction of that interest. (Doctor v. Hughes, 225 N. Y. 305.) ”

Plaintiff is entitled to judgment '".•evoking the trust instrument.

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

Judgment accordingly. (See 280 N. Y. 687.)


text:
    M. O’Neil Supply Company, Inc., Appellant, v. Petroleum Heat & Power Company, Inc., Respondent.
    Argued January 5, 1939;
    decided February 28, 1939.

      M. M. Leichter and John L. Ketcham for appellant.
    The agreement is open to paroi evidence to explain it, and all important inferences are in favor of plaintiff’s construction. The inference is that Charles’ breach of obligation to defendant was not intended to give defendant any right to rescind as to plaintiff, and since the exchange brought to the agreement by plaintiff as the basis of its claim for payment bears no relation whatever to performance by Charles of his obligation to defendant, the inference is that such performance was intended not as a condition precedent to plaintiff’s right to payment, but merely as fixing the time thereof. (Martin v. Crumb, 216 N. Y. 500; Mascioni v. Miller, 261 N. Y. 1; Berry Harvester Co. v. Wood Co., 152 N. Y. 540; Union Ins. Co. v. Central Trust Co., 157 N. Y. 633; Hughes v. Cuming, 165 N. Y. 91; Williston on Contracts, § 799; Childs v. Smith, 46 N. Y. 34; De Long v. Zeto, 135 App. Div. 79; Atwater & Co. v. Panama R. R. Co., 246 N. Y. 519; Manson v. Curtis, 223 N. Y. 313; Hutchison v. Ross, 262 N. Y. 381; Simon v. Etgen, 213 N. Y. 589; Matter of People [Bond & Mortg. Guar. Co.], 267 N. Y. 419; Moran v. Standard Oil Co., 211 N. Y. 187; Matter of Smith, 254 N. Y. 283.)

      Ralph Royall and Archibald H. Cashion for respondent.
    The contract is complete and unambiguous and its construction is for the court without the aid of paroi evidence. The covenant sought to be enforced is conditional and the complaint is insufficient for failure to allege completion by Charles. (Heller v. Pope, 250 N. Y. 132; Hutchison v. Ross, 262 N. Y. 381; Ayers v. Palatine Ins. Co., 234 N. Y. 334; Higgs v. de Maziroff, 263 N. Y. 473; Amies v. Wesnofske,
      255 N. Y. 156; Trustees of Columbia University v. Kalvin, 250 N. Y. 469; Lighton v. City of Syracuse, 188 N. Y. 499; Parsons v. Tilden, 59 N. Y. 639.)
   Rippey, J.

Plaintiff appeals, by permission of this court, from a judgment entered upon the order of the Appellate Division, first department, unanimously affirming the judgment entered upon an order of Special Term dismissing the first cause of action on motion of defendant under rule 106 of the Rules of Civil Practice on the ground that the complaint did not state facts sufficient to constitute a cause of action.

Plaintiff alleges that defendant and one Charles had entered into an agreement prior to July 16, 1936, whereby Charles agreed to do certain pipe installation and other work in connection with a heating plant that defendant was installing in the Lombardy Hotel and in adjacent buildings in New York city, that Charles had purchased certain materials from plaintiff and owed a balance thereon for which plaintiff was about to file a mechanic’s lien against the real property in course of improvement and against defendant and Charles, and that Charles had stopped work because of disagreements with defendant. It appears that defendant had the general contract for the work and that Charles was its subcontractor.

The plaintiff further alleges that the plaintiff, Charles and defendant thereupon entered into a tripartite agreement in writing which is made a part of the complaint. It is this contract which furnishes the basis for the cause of action which has been dismissed. In the contract, it is recited that differences have arisen between the parties under the subcontract, that Charles has filed a lien against the property and that defendant has made certain payments to Charles for work already done under the contract. Charles agreed to waive any right which he might have on the lien filed and to any claim against defendant by lien or otherwise for past or future labor and services upon payment by defendant to Charles or to his assignee of $950. Charles agreed promptly to proceed with and complete the work remaining to be done. Plaintiff agreed to furnish the necessary materials for completion of the work and to waive any right to a lien on the premises or to any further claim for payment for the materials already furnished or to be furnished on payment by defendant to it of the sum of $2,800 at its request “ five days after the completion of the installation by said Thomas J. Charles in accordance with the contract or purchase orders No. 943, etc., above referred to and the specifications accompanying the same and approval of the same by Edwin A. Kingsley, engineer for Petroleum Heat & Power Company, Inc.”

Charles failed to complete the installation and defendant finished the work. Plaintiff refrained from filing any lien and furnished all materials required for the completion of the contract and alleges that it fully performed all obligations specified in the contract to be performed by it. Defendant refused to pay the $2,800 which it agreed to pay on the sole ground that Charles personally did not complete the work. In the complaint, it is alleged that it was intended and agreed between the parties that the sum of $2,800 should be paid by defendant to plaintiff five days after the completion of the work or within a reasonable time thereafter and that “ said completion bore upon plaintiff’s right of payment solely as convenient means of fixation of the time thereof, and not as condition precedent to the right of such payment and the parties intended said right of payment should be absolute.” To sustain the complaint, plaintiff is entitled to every favorable inference that reasonably may be drawn from the allegations that it contains.

Defendant claims, so far successfully, that completion of the installation by Charles was a condition precedent to its liability under the contract and much reliance is placed on Amies v. Wesnofske (255 N. Y. 156), but nothing was decided in that case which is contrary to the contentions of plaintiff. Upon the evidence-in that case, the jury found that defendants had agreed to pay to plaintiffs, acting as real estate brokers, certain commissions on the closing of title ” to premises being sold by defendants to third parties. Title was never closed, the closing was neither prevented nor hindered by defendants and there was no waiver by defendants of the condition precedent to liability. It was held that plaintiffs could not recover. In such a case the obligation itself was contingent. The promise to pay extended to the debt itself. We think that here it could be found that it was the intention of the parties that the debt should be fixed and absolute and that the condition concerning payment attached solely to the event of completion of the work, the happening of which established a convenient time of payment (3 Williston on The Law of Contracts [Rev. ed.], § 799).

It is true that the time of payment to plaintiff was to be fixed by the consummation of a condition, but that condition was that the subcontract between Charles and defendant should be completed, that the work should be approved by defendant’s representative and that five days should elapse thereafter before payment could be required. The finishing of the work by Charles individually was not a material part of the contract between plaintiff and defendant. It might have been material as between Charles and the defendant. The promise of defendant to pay was independent of the completion of the work by Charles individually, the time of payment being based alone on the happening of the condition stated (Childs v. Smith, 46 N. Y. 34). That is clearly inferable from the situation appearing from the contract and from the allegations of the complaint. The plaintiff had no pecuniary interest in the completion of the work by Charles individually. As to completion under the subcontract, defendant only could compel Charles to perform. Failure of Charles to perform was no fault of plaintiff. Payment to plaintiff could not have been interminably held up merely because of nonperformance by Charles. The duty of defendant to see that the work was completed within a reasonable time was clearly implied. Every contract implies good faith and fair dealing between the parties ” and the promise of defendant will be implied if not found in the express terms of the contract (See Wigand v. Bachmann-Bechtel Brewing Co., 222 N. Y. 272, 277, 278). Plaintiff could not have understood the contract to provide that payment would be conditioned upon the whim or caprice or failure of defendant to show good faith or to exercise due diligence in effecting the completion of the work. If the contract may be construed in more senses than one, such construction should be adopted as will be more beneficial to and as understood by the promisee (Hoffman v. Ætna Ins. Co., 32 N. Y. 405, 413; White v. Hoyt, 73 N. Y. 505). It cannot be inferred from the contract that plaintiff gave up its right to file a lien or to recover at all for materials furnished or to be furnished on any assumption that defendant would not cause the contract for the completion of the work to be performed within a reasonable time (Atwater & Co. v. Panama R. R. Co., 246 N. Y. 519, 523). Plaintiff was no longer satisfied to rely on the credit of Charles or upon him for payment. Plaintiff was looking to defendant for payment and not to Charles; defendant specifically agreed to pay a sum fixed by the terms of the contract at a reasonably definite time after the date of its execution. The inducement for plaintiff to enter into the agreement lay in defendant paying the price fixed for the materials and that was the part of the agreement that made it safe for plaintiff to part with its rights and property (Hughes v. Cuming, 165 N. Y. 91).

The fundamental rule in the construction of all agreements is to ascertain the substantial intent of the parties (Kennedy v. Porter, 109 N. Y. 526, 544; Canal Co. v. Hill, 15 Wall. [U. S.] 94). The purpose to be accomplished and the object to be advanced may be considered (Manson v. Curtis, 223 N. Y. 313, 320; Atwater & Co. v. Panama R. R. Co., 246 N. Y. 519, 524) and may, if necessary, be shown by paroi evidence as bearing on the consideration for the written instrument (Hutchison v. Ross, 262 N. Y. 381, 398). If it is claimed by defendant that a construction should be placed on the contract other than has been indicated, or any doubt arises from the writing itself, the court must look into the intention of the parties to be derived not alone from the words used but it must be read, so far as they may be ambiguous, in the light of the surrounding facts and circumstances (Berry Harvester Co. v. Wood M. & R. Mach. Co., 152 N. Y. 540; Wilson v. Ford, 209 N. Y. 186, 196), in which event paroi evidence may be introduced as to those facts and circumstances without violating the paroi evidence rule (Matter of Smith, 254 N. Y. 283, 289; Mascioni v. Miller, Inc., 261 N. Y. 1). While ordinarily the interpretation of written contracts is for the court alone, in any event, “ the most that can be said for the defendant is that its meaning is ambiguous, and that its construction was fur the jury.” (Martin v. Crumb, 216 N. Y. 500, 505). If exploration to find the intent of the parties necessarily extends beyond the written words of the contract, defendant will not be heard to complain.

Upon the facts appearing in the complaint in this case, hairline distinctions will not be drawn nor circuitous reasoning indulged nor technicalities relied on to bar recovery on a contract based on valid considerations which has for its purpose the securing of payment of what appears to be a just debt where the intent that it should be paid is clear. If the agreement is capable of a construction which will make it valid and enforceable, that construction will be placed on it (3 Williston on The Law of Contracts [Rev. ed.], § 769; Archibald v. Thomas, 3 Cow. 284, 290; Standard Oil Co. v. Scofield, 16 Abb. New Cases, 372; Hoffman v. Ætna Ins. Co., 32 N. Y. 405; Franklin Life Ins. Co. v. Wallace, 93 Ind. 7; Chicago, B. & Q. R. R. Co. v. City of Aurora, 99 Ill. 205). If the completion of the work by Charles individually was a condition precedent to any payment at all to plaintiff, if the debt itself was contingent, the defendant cannot rely on the condition precedent to prevent recovery where the non-performance of the condition was caused or consented to by itself (Young v. Hunter, 6 N. Y. 203).

The judgments should be reversed and the motion denied, with costs in all courts, and ten dollars costs of motion. (See 280 N. Y. 687.)

Crane, Ch. J., O’Brien, Herbs, Loeghran and Finch, JJ., concur; Lehman, J., taking no part.

Judgments reversed, etc.


text:
    Frances N. Sturman, Appellant, v. New York Central Railroad Company, Respondent.

      Argued January 6, 1939;
    decided February 28, 1939.

      Ralph Stout, Louis Rothbard and Abraham Males for appellant.
    Upon the evidence it was a question of fact for the jury whether the bridge, as maintained by the defendant, was a nuisance. (Gale v. N. Y. C. & H. R. R. R. Co., 76 N. Y. 594; Allen v. B., R. & P. Ry. Co., 151 N. Y. 434; Hatch v. Syracuse, B. & N. Y. R. R. Co., 50 Hun, 64; City of Mount Vernon v. N. Y., N. H. & H. R. R. Co., 232 N. Y. 309; People v. N. Y. C. & H. R. R. R. Co., 74 N. Y. 302; Cooke v. Boston & Lowell R. R. Co., 133 Mass. 185; Charlottesville v. So. Ry. Co., 97 Va. 428; Burritt v. New Haven, 42 Conn. 174; Indiana v. Lake Erie & W. R. R. Co., 83 Fed. Rep. 284; Little Miami R. R. Co. v. Commrs., 31 Ohio St. 338; Atchison, etc., R. R. Co. v. Henry, 57 Kan. 154; Briggs v. City of North Tonawanda, 213 App. Div. 781; Koehler v. City of New York, 262 N. Y. 74; Stern v. International Ry. Co., 220 N. Y. 284.) The questions of defendant’s negligence and plaintiff’s freedom from contributory negligence were for the jury. (Saphir v. Childs

      Co., 243 App. Div. 636; Klepper v. Seymour House Corp., 246 N. Y. 85; Glover v. Holbrook, Cabot & Rollins Corp., 189 App. Div. 328; Durr v. N. Y. C. & H. R, R. R. Co., 184 N. Y. 320; Annino v. City of Utica, 276 N. Y. 192.) The defendant was not relieved from, its duty of safeguarding travelers lawfully using the highway because no order had been made prior to the accident by the Public Service Commission requiring the defendant to widen the bridge. (D., L. & W. R. R. Co. v. City of Buffalo, 158 N. Y. 266; McGettigan v. N. Y. C. R. R. Co., 268 N. Y. 66.) The judgment in the plaintiff’s prior action against the State of New York arising out of this accident was not res judicata herein. (Bolivar v. Monnat, 232 App. Div. 33; Bigelow v. Old Dominion Copper Mining & Smelting Co., 225 U. S. 111.)

      Kenneth O. Mott-Smith and Clive C. Handy for respondent.
    The State and not the railroad owed the duty to maintain the roadway over and the approaches to the bridge in a safe condition. (City of Yonkers v. N. Y. C. & H. R. R. R. Co., 165 N. Y. 142; Bush v. Delaware, L. & W. R. R. Co., 166 N. Y. 210; Town of Cortlandt v. N. Y. C. R. R. Co., 175 App. Div. 194; 220 N. Y. 598; Murphy v. Delaware & Hudson Co., 151 App. Div. 351; Burchard v. Payne, 197 App. Div. 829; 233 N. Y. 671.) If the State had adequately discharged its duty of warning the public of the danger created by the widening of the highway, no further duty to the public was owed by the railroad. Hence the decision in the plaintiff’s action against the State is dispositive of the present action. (Good Health Dairy Products Corp. v. Emery, 275 N. Y. 14; Weis v. Long Island R. R, Co., 262 N. Y. 352.) Neither at common law nor by statute is any duty placed upon a railroad company to institute proceedings before the Public Service Commission for the widening or reconstruction of a bridge rendered inadequate or dangerous through no act of default on the part of the railroad. (Shea v. B. & M. R. R., 191 Atl. Rep. 650.) Section 21 of the Railroad Law (Cons. Laws, ch. 49) requires a railroad only to restore a highway to its original condition. Where a bridge as constructed is the same width as the original highway, section 21 does not require the bridge to be rebuilt so as to accommodate a wider highway nor does it impose upon a railroad company any added duty to that imposed by sections 89 to 95, inclusive. Still less does it furnish any ground for imposing civil liability upon a railroad in the absence of any notification in writing by the public authorities of the inadequacy of the existing bridge. (People v. N. Y., N. H. & H. R. R. Co., 89 N. Y. 266; Allen v. Buffalo, R. & P. R. Co., 151 N. Y. 434; Murphy v. D. & H. Co., 151 App. Div. 351; Burchard v. Payne, 197 App. Div. 829; 233 N. Y. 671.)
   Loughran, J.

In the early morning of December 14, 1930,' an automobile driven by Irving L. Levey crashed through the side railings of a bridge that carried the Albany post road over the right of way of the New York Central Railroad Company and fell to the tracks below. Plaintiff, who was a guest in the vehicle, sues the railroad company for injuries she suffered on that occasion.

The bridge was located in the town of Cortlandt, Westchester county, a short distance south of Peekskill. As rebuilt by a predecessor of the defendant in 1911, it was twenty feet wide as was the adjacent pavement of the post road at that time. In 1927 this pavement was widened by the State to twenty-seven feet and at either approach to the bridge was so tapered as to adjust it to the twenty-foot width thereof.

Plaintiff offered evidence tending to show that in the changed terrain the structure and location of the bridge made it a menace to travelers on the highway in the night time and that (although the danger had been proclaimed by the occurrence of more than 200 similar accidents) the defendant gave no warning of that situation. When the direct case was still uncompleted, the trial judge dismissed the complaint on the short ground that the defendant owed no duty to the plaintiff in the circumstances. The Appellate Division affirmed. In view of the general importance of the question involved, this court granted the plaintiff leave to appeal.

The defendant is a successor of the Hudson River Railroad Company, a corporation that was created by chapter 216 of the Laws of 1846. Section 14 thereof made this provision: Whenever it shall be necessary for the construction of their single, double or treble railroad or way, to intersect or cross * * * any r0ad or highway, * * * it shall be lawful for the said corporation to construct their way or ways across or upon the same; but the corporation shall restore the * * * road or highway, thus intersected, to its former state in a sufficient manner so as not to have impaired its usefulness.” So, the Railroad Law (Cons. Laws, ch. 49) has long provided: “ Every railroad corporation which shall build its road along, across or upon any * * * street, highway, plank-road or turnpike, which the route of its road shall intersect or touch, shall restore the * * * street, highway, planlcroad and turnpike, thus intersected or touched, to its former state, or to such state as not to have unnecessarily impaired its usefulness, and any such highway, turnpike or plank-road may be carried by it, under or over its track, as may be found most expedient.” (Now § 21.)

The burden so imposed is a continuing duty of restoration, maintenance and care and within limits requires railroad corporations to make such alterations of their highway appurtenances as from time to time become necessary to the public safety and convenience in keeping with regional developments and growth of traffic. (City of Mt. Vernon v. N. Y., N. H. & H. R. R. Co., 232 N. Y. 309, 316, 317, and cases there cited.) This much the defendant does not deny. The main question here presented is as to the scope of that obligation in this instance. If it had been disregarded either in its letter or spirit, the defendant was liable for the damages resulting to the plaintiff.” (Allen v. Buffalo, R. & P. Ry. Co., 151 N. Y. 434, 442.)

Defendant’s argument is put largely upon the more recently enacted provisions of sections 93 and 91 of the statute. These are pressed upon us as having superseded section 21 in any bearing that it might otherwise have had on this case.

It is true that in accordance with section 93 the roadway over the bridge and the approaches thereto were to be maintained and kept in repair by the municipal or State authority having jurisdiction, except in contingencies that do not here appear. (Weis v. Long Island R. R. Co., 262 N. Y. 352.) Section 21 may be taken to be limited accordingly. This limitation, however, leaves the case substantially the same, for section 93 also provides: When a highway crosses a railroad by an overhead bridge, the framework of the bridge and its abutments shall be maintained and kept in repair by the railroad corporation.” (See Bush v. D., L. & W. R. R. Co., 166 N. Y. 210.)

The effect of section 91 is that an alteration of an existing crossing can now be brought about only pursuant to an order of the Commission having jurisdiction made in a proceeding initiated either by the railroad corporation or by the competent municipal or State authority — and then the expense thereof is to be divided between the corporation and the community in accordance with section 94. But nothing in these procedural requirements makes section 21 any less a vital substantive part of the statute. (People ex rel. Town of Colesville v. D. & H. Co., 177 N. Y. 337; City of Olean v. Pennsylvania R. R. Co., 249 N. Y. 364, 368.)

Plaintiff’s case is not that the defendant unreasonably delayed prosecution of a proceeding under section 91 for alteration of this crossing. As counsel state it, her position is that it was the duty of the defendant railroad, after notice had been brought home to it by repeated accidents due to its narrow bridge, to take reasonable care (by illumination and warning) to protect travellers lawfully and properly using the highway from the existing danger.” Our best judgment is that the plaintiff has the right to a decision of the issue whether in all the circumstances such a default of the defendant amounted to a breach of its continuing duty not unnecessarily to impair the usefulness of the highway. (See Stern v. International Ry. Co., 220 N. Y. 284; McGettigan v. N. Y. C. R. R. Co., 268 N. Y. 66; Forte v. City of Albany, 279 N. Y. 416; Manley v. St. Helens Canal & Ry. Co., 2 Hurlstone & Norman, 840.)

A claim made by this plaintiff against the State for compensation for her injuries was heretofore dismissed on a finding that the sole proximate cause of the accident was the failure of Mr. Levey, the driver of the automobile, to heed warning signs placed by the State to apprise passing motorists of the potential danger of the narrow bridge (Sturman v, State of New York, 269 N. Y. 627.) This defendant was not a party to that litigation (cf. Masterson v. N. Y. C. & H. R. R. R. Co., 84 N. Y. 247, 255) nor was the negligence of Mr. Levey to be imputed to the plaintiff. (Koehler v. City of New York, 262 N. Y. 74, 79; Michelson v. Stuhlman, 272 N. Y. 163.)

The judgments should be reversed and a new trial granted, with costs in all courts to abide the event. (See 280 N. Y. 688.)

Crane, Ch. J., O’Brien, Htjbbs, Finch and Bippey, JJ., concur; Lehman, J., taking no part.

Judgments reversed, etc.


text:
    Fred Fisher, Appellant, v. Long Island Lighting Company, Respondent.
    Argued January 9, 1939;
    decided February 28, 1939.

      Jacob Leiman for appellant.
    The Appellate Division erred in its interpretation of section 15 of the Transportation Corporations Law (Cons. Laws, ch. 63). (Matter of Meyer, 209 N. Y. 386.) The judgment of the trial court, as affirmed by the Appellate Division, is contrary to law. (Schmitt v. Edison Electric Illuminating Co., 58 Misc. Rep. 19; Hollander v. Westchester Lighting Co., 79 Misc. Rep. 646; Levine v. Brooklyn Union Gas Co., 146 App. Div. 464; Hoch v. Brooklyn Borough Gas Co., 117 App. Div. 882.)

      Philip Huntington and David S. Hill, Jr., for respondent.
    The judgment is based upon sound and legal construction of the statute. (Tismer v. N. Y. Edison Co., 228 N. Y. 156; Hoberg v. New York Edison Co., 144 Misc. Rep. 726; McMullin v. N. Y. Power & Light Corp., 249 App. Div. 695; Eff-Ess, Inc., v. New York Edison Co., 237 App. Div. 315.)
   Loughran, J.

The defendant Long Island Lighting Company, a public service corporation, supplied electric current in the home of the plaintiff at Bellemore, Long Island. On March 26, 1936, this service was cut off by the company without advance notice. Three months later the plaintiff paid, under protest, a bill of $181 for unmetered current ” and thereupon the service was renewed.

The company is subject to the Transportation Corporations Law (Cons. Laws, ch. 63). At the time here in issue, section 15 thereof (as amd. L. 1935, ch. 481) provided: If any person supplied with gas or electric light by any such corporation shall neglect or refuse to pay the rent or remuneration due for the same * * * such corporation may discontinue the supply of gas or electric light to the premises of such person; * * * But the supply of gas or electric light shall not be discontinued for any cause until and after a five-day written notice, either personally or by registered mail, has been given to such person.” (The emphasis is ours.) For breach of this last provision, plaintiff demands of the company the penalties imposed by section 12 of the statute, restitution of the sum he paid to it under protest, and compensation for loss of use and occupation of his home while the current was shut off.

The jury was charged that the company was bound to give the statutory notice and that its failure to do so made it answerable to the plaintiff for his consequent damages. Despite the company’s concession that no notice had been given, the verdict was in its favor. Doubtless the reason was that the jury credited the company’s defense that its equipment in the plaintiff’s home had been so tampered with that current used was not recorded by the meter. We think this defense had no warrant in the foregoing text of the former section 15 of the statute.

From the premise that “ It could not have been the intention of the Legislature to protect the consumer in the right to commit larceny,” the Appellate Division concluded that “ It is proper to interpret this statute as though it read 1 for any cause other than criminal or fraudulent conduct on the part of the consumer.’ ” (254 App. Div. 866.) In our opinion, no such departure from the letter of the law was called for. We discern nothing whimsical or vicious in the unqualified command of this statute that a gas or electric corporation was not to discontinue the supply of gas or electric light before it gave a five-day written notice to the consumer. Perhaps that policy in the long run did justice all around. In any case, we find ourselves unable to say that common setise or moral principle necessitated an allowance to such corporations of fuller rein in passing judgment on their patrons.

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

Crane, Ch. J., Lehman, O’Brien, Finch and Rippey, JJ., concur; Hubbs, J., dissents.

Judgments reversed, etc.


text:
    Jack Gilbert, Appellant, v. Irving S. Rothschild, Respondent.

      Argued January 12, 1939;
    decided February 28, 1939.

      Arthur Block and O. M. Clark for appellant.
    In personal injury actions, where plaintiff, being deceived with respect to the nature and quality of his injuries, gives a general release, the release may be avoided. (McNally v. Phœnix Ins. Co., 137 N. Y. 389; Kirchner v. New Home Sewing Machine Co., 135 N. Y. 182; Dominicis v. U. S. Cas. Co., 132 App. Div. 553; Landau v. Hertz Drivurself Stations, Inc., 237 App. Div. 141; Harvey v. Georgia, 148 Misc. Rep. 633; Lumley v. Wabash R. R. Co., 76 Fed. Rep. 66.) In personal injury actions, where a plaintiff, being deceived with respect to the nature and quality of his injuries, gives a general release, he need not return the consideration but the defendant may be credited in the ultimate judgment or the action be deemed one to recover for the more serious injuries. (Ralle v. Peerless American Products Co. 192 App. Div. 506; Simmons v. Ocean Causeway, 21 App. Div. 30; Banta v. Banta, 84 App. Div. 138; E. T. C. Corp. v. Title Guarantee & Trust Co., 271 N. Y. 124; Allerton v. Allerton, 50 N. Y. 670; Larscy v. Hogan & Sons, Inc., 239 N. Y. 298; Harvey v. Georgia, 148 Misc. Rep. 633; Kirchner v. New Home Sewing Machine Co., 135 N. Y. 182; Lumley v. Wabash R. R. Co., 76 Fed. Rep. 66; Bliss v. R. R. Co., 160 Mass. 447; Great Northern Ry. Co. v. Fowler, 136 Fed. Rep. 118; Union Pacific Ry. Co. v. Harris, 158 U. S. 326.) The plaintiff’s complaint was prematurely dismissed. (Hoffman House v. Foote, 172 N. Y. 348; Rase v. Minneapolis R. R. Co., 118 Minn. 437; Hornstein v. Podwitz, 229 App. Div. 167; Boxberger v. N. Y., N. H. & H. R. R. Co., 237 N. Y. 75; McNamara v. Eastman Kodak Co., 232 N. Y. 18.)

      William L. Shumate for respondent.
    The plaintiff is attempting to recover on his original cause of action in disaffirmance of a general release which is not void but merely voidable. A return or tender back to the defendant of the consideration which the plaintiff received for executing the release is a condition precedent to the maintenance of such an action. (Gould v. Cayuga County Nat. Bank, 86 N. Y. 75; Cobb v. Hatfield, 46 N. Y. 533; McMichael v. Kilmer, 76 N. Y. 36; E. T. C. Corp. v. Title Guarantee & Trust Co., 271 N. Y. 124; McNamara v. Eastman Kodak Co., 232 N. Y. 18.)
   Rippey, J.

This action is brought to recover damages for personal injuries resulting from defendant’s negligence which injuries are alleged to have been received by plaintiff on January 9, 1935, while riding as a passenger in defendant’s motor vehicle.

A single cause of action is set up in the complaint to recover for all injuries resulting from the accident, immediate, temporary and permanent. The answer contains denials of every allegation of the complaint. As a separate defense and bar to the cause of action set up in the complaint, the answer contained allegations to the effect that, on March 15, 1935, plaintiff executed and delivered to defendant, for a valuable consideration, a general release in writing and under seal whereby plaintiff released and forever discharged the defendant from the cause of action set up in the complaint and all manner of actions, cause or causes of action, suits, debts, dues, sums of money and damages which the plaintiff ever had against defendant to the date of the instrument. The reply did not put in issue the execution, delivery and general nature of the release, and plaintiff thereby admitted its execution and delivery for a good and valuable consideration and that it discharged the cause of action set up in the complaint. In the reply to the new matter set up in the answer, plaintiff’s only allegation was that the release therein claimed was procured by fraud and misrepresentation in that the plaintiff was misled and deceived by the defendant’s agent, servant or employee into believing that the injuries resulting to him from this accident were slight, minor and inconsequential, when in reality said injuries and their resultant effects were and are of a grave, serious and permanent nature.”

On December 26, 1936, upon motion of defendant and without objection by plaintiff an order was made at Special Term directing that “ the issues raised by the separate defense of general release * * * be tried separately and prior to any trial of the other issues in this case.” In regular order this issue was brought on for trial before a jury. Upon the opening of counsel for the plaintiff and upon replies to inquiries by the court in which he admitted that the money paid by defendant in compromise had been retained and that there had been no tender or payment back and upon his refusal to accept the opportunity presented by the court then and there to make such payment or tender and proceed with the trial, the court granted defendant’s motion to dismiss the reply. Thereupon and ' without further proceedings judgment was entered on the pleadings dismissing the complaint. The motion to dismiss the reply was correctly granted since, in the state of the pleadings and the admission of plaintiff in open court upon the trial that he had not paid back or tendered back the amount received and that he refused to do so, plaintiff could not litigate the issue as to the voidability of the contract.

Counsel for appellant first insists that the motion to dismiss should not have been granted upon the opening but the court should have proceeded to take the proofs of the parties. If the record should be construed to indicate that the motion was granted upon the opening of plaintiff, the rule is that it must be assumed “ that every material fact in issue is to be resolved * * . * in favor of the plaintiff ” (Hoffman House v. Foote, 172 N. Y. 348). In the Hoffman case (p. 350) it is said: If it can be demonstrated either (1) that the complaint does not state a cause of action or (2) that a cause of action well stated is conclusively defeated by something interposed by way of defense and clearly admitted as a fact, or (3) that the learned counsel for the plaintiff, in his opening address, by some admission or statement of facts, so completely ruined his case that the court was justified in granting a nonsuit, then this judgment ought to be sustained; but not otherwise. The practice of disposing of cases upon the mere opening of counsel is generally a very unsafe method of deciding controversies, where there is or ever was anything to decide.” The opening is not contained in the printed record on appeal. Under those conditions, it must be presumed that it comprised the substance of the reply (Kley v. Healy, 127 N. Y. 555, 560; 4 Carmody’s New York Practice, p. 3117). There is nothing in the record to show that there was any offer to prove anything beyond that contained in the reply except that, in the colloquy between court and counsel, plaintiff’s counsel said: We claim that there is a settlement here of minor injuries which they represented to the man he had.” The complaint was drawn on the theory that suit was for all injuries plaintiff received, not for a part not known to him at the time of settlement. The release, in terms, admittedly was broad enough in scope to cover the present cause of action. There was nothing in the reply to indicate that the release was not affirmed as covering a compromise for all injuries received. No motion was made at the trial to amend the complaint or reply. Plaintiff stood squarely on the proposition that the release was void for fraud and could not bar the prosecution of the action and that he was not required to restore or tender back the consideration for the release as a condition precedent for the maintenance of the suit. The issue of waiver by or estoppel of defendant from asserting the release in bar was not in issue or asserted on the trial nor was any reason advanced by plaintiff why the release should not be a complete bar to a voidable contract. In whatever aspect the case may be considered, the reply did not state a defense to the release nor did plaintiff offer any defense.

The question then arises whether, in view of the pleadings and state of the record at the trial, the plaintiff could maintain the action without rescission or an attempt to rescind the compromise contract of settlement. He has sued at law without rescission or attempt at rescission. The claim of the plaintiff does not lie in the fact that there was fraud in the execution of the instrument itself, that he was induced to sign an instrument different than he understood it to be,— that no agreement of compromise in fact existed. In such a case the fraud would lie in the factum, the instrument would be void (Boxberger v. N. Y., N. H. & H. R. R. Co., 237 N. Y. 75; Pimpinello v. Swift & Co., 253 N. Y. 159) and rescission unnecessary (Whipple v. Brown Bros. Co., 225 N. Y. 237; Farrington v. Harlem Sav. Bank, 280 N. Y. 1). Nor is this a case where it is or can be claimed that the release was limited and covered a portion only of plaintiff’s loss for which he seeks no recovery in this action. In such a case rescission would be unnecessary and ho would not be required to tender back the money received before he could prosecute the action (Kirchner v. New Home Sewing Machine Co., 135 N. Y. 182; Lumley v. Wabash R. R. Co., 76 Fed. Rep. 66; Bliss v. N. Y. C. & H. R. R. R. Co., 160 Mass. 447). Plaintiff cannot retain the money and apply it on the recovery (Cf. Douglass v. Scott, 130 App. Div. 322; Kley v. Healy, 127 N. Y. 555, 561) in the face of objections to that course being followed, since his claim is unliquidated, none of it is certainly recoverable and there may be no recovery at all. In cases called to our attention where such a procedure has been followed (Larscy v. Hogan & Sons, 239 N. Y. 298; Ambellan v. Barcalo Mfg. Co., 118 App. Div. 547; Fleming v. Brooklyn Heights R. R. Co., 95 App. Div. 110; Harvey v. Georgia, 148 Misc. Rep. 633) the parties consented or, at least, did not object or disapprove. The doctrine of rescission does not apply to a case where an attempt is made to avoid a transaction on the ground of fraud if the party making such an attempt would be entitled to retain the consideration paid either by virtue of the contract sought to be set aside or of the original liability ((Gould v. Cayuga County Nat. Bank, 86 N. Y. 75, 81; Kley v. Healy, 127 N. Y. 555, 561; Belt v. American Central Ins. Co., 148 N. Y. 624; New York Bankers, Inc., v. Duncan, 257 N. Y. 160; E. T. C. Corp. v. Title Guarantee & Trust Co., 271 N. Y. 124, 128). The only theory on which plaintiff can succeed on the pleadings and admitted facts is by avoidance of the release on the ground of mistake on his part and fraud, deceit and misrepresentations on the part of defendant as to the nature of his injuries. That is in accord with the allegations in the reply and the proceedings at the trial. Fraud in the quantum is claimed. He asks for no relief by way of rescission. The release was not void, but voidable (Adams v. Gillig, 199 N. Y. 314). In such a case, the general release is an absolute bar to the action unless rescinded, and rescission can be effective only by returning or tendering back the consideration received (Gould v. Cayuga County Nat. Bank, 86 N. Y. 75; McNamara v. Eastman Kodak Co., 232 N. Y. 18; E. T. C. Corp. v. Title Guarantee & Trust Co., 271 N. Y. 124,128). He may not litigate his claim for damages while clinging to the fruits of the contract which he affects to disaffirm ” (Brassel v. Electric Welding Co., 239 N. Y. 78, 81). Plaintiff was too late at the trial to amend and base his action on previous repudiation of the contract. There was no such repudiation and none claimed. He made no attempt to convert his action by way of amendment or otherwise into one for a rescission. Where the cause of action is founded upon rescission, the payment or tender must be made before commencement of the action; if /or a rescission, it will be sufficient to offer in the complaint to return the amount received and make tender on the trial (Vail v. Reynolds, 118 N. Y. 297, 302).

Plaintiff finally rests on the claim that reversal should be had because the judgment dismissing the complaint was premature. As a matter of technical procedure, his contention is correct, but as a matter of substance it cannot be sustained. The reply, as we have seen, was correctly stricken out. That left the complaint and answer in the case with the defense of the general release admitted both as to its scope and validity. By it, recovery in the action was absolutely barred. Had a suitable motion been made upon the complaint and answer, the complaint must necessarily have been dismissed. While we do not mean to approve the practice indulged in, had the correct practice been followed the same result would have been reached. Furthermore, the practice involved a mere irregularity which could have been corrected by motion. Should we send this case back to require the court to do a useless act? We think not.

The judgment appealed from should be affirmed, with costs.

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

Judgment affirmed.