text:
    Annette B. Wetmore, Resp’t, v. Sarah Taylor Wetmore, Individually and as Trustee, etc., Impleaded, etc., App’lt.

      (Supreme Court, General Term, First Department,

      Filed June, 1894.)

    1. Divorce—Alimony—Sequestration.
    Where, in ail action in equity founded upon a domestic judgment of divorce awarding alimony, it appears that the husband has fled the jurisdiction and has failed and refuses to pay such alimony, the court has power to direct the application of the income of a trust fund within its jurisdiction, of which the husband is cestui que trust, to the payment of the alimony.
    S. Same—Indefinite application.
    To avoid a multiplicity of actions, the judgment may direct the applica tion of such income indefinitely as it accrues, to the satisfaction of claims of alimony as they mature.
    3. Same—Priority.
    Such power is paramount to claims of mere creditors of the husband.,
    4. Same—Whole income.
    Where the husband has other means adequate for his own support, and the annual income from the trust fund does not exceed the annual amount awarded for alimony, the whole income may be applied to the payment of the alimony.

      S. P. Nash, for app’lt trustee; Qerrard Irvine Whitehead, for app’lt William B. Wetmore; Flamen B. Candler, for resp’t.

      Affirming 58 St. Rep. 751.

   Barrett, J.

This action is founded upon the judgment of this court awarding the plaintiff a divorce, by reason of her husband’s adultery. In this judgment the husband (the present defendant, William B. Wetmore) was required, to quote the language of the Code, “ to provide suitably for the education and maintenance of the children of the marriage, and for the support of the ” plaintiff.

Every remedy given to the plaintiff by the Code of Civil Procedure for the enforcement of these provisions has been exhausted. See The Continental Trust Co. v. Wetmore, 67 Hun, 9; 50 St Rep. 491. These remedies have proved unavailing, not because of Mr. Wetmore’s inability, but because of his factious refusal to comply with the judgment. His disobedience was intentional and his purpose to nullify the judgment deliberate. To effecuate this purpose he left the state and took with him all his tangible property. In plain words, he fled the jurisdiction, defied our courts, and left his wife and children to starve.

It appears, however, that there is within the jurisdiction a trust fund, which was created for his benefit and which he cannot remove. The income derivable from this trust fund is now the sole hope of the plaintiff and of his children—and it is this income which is sought to be secured by the present action. The trust in question was created by the fifth clause of the will of Mr. Wetmore’s father, which read as follows:

Fifth. I give and bequeath to my executors hereinafter named, other than my son, one hundred thousand dollars (in cash or in securities, or in stocks valued by my executors at that sum), upon trust, to keep the same invested and receive the income thereof, and, after deducting reasonable charges for the management of said trust, to apply the net income of said fund, from time to time as it shall accrue, to the use of my son, William Boerum Wetmore, so long as he shall live.”

Under this clause Mr. Wetmore claims that he is absolutely entitled to the net income of the fund ; that, notwithstanding the divorce and alimony judgment, such net income must be periodically remitted to him in his voluntary exile, and that the plaintiff is remediless with regard thereto. In other words, he claims that, because of his flight, this court is powerless to enforce its judgment or to act upon the trust which is within its jurisdiction.

We might well say, in answer to this claim, what was said by the supreme court of the United States in Barber v. Barber, 21 How. U. S., 596, answering an equally bold assertion of the absence of legal redress against perpetrated wrong, by a quotation from the opinion of a distinguished South Carolina judge: “If that; argument were to prevail there would be a failure of justice, which our law abhors, and there would be no means of enforcing a decree of a wife against her husband for alimony, * * * and upon this occasion I would adopt the course of a very learned judge, ‘If there is no precedent, I will make one.’ ” •

We might further answer this claim by a reference to the case of National Tradesman’s Bank v. Wetmore, 124 N. Y. 241; 35 St. Rep. 316, and'tothe remarks of Bradley, J., with, regard to equity jurisdiction upon the subjects of fraud and trust's.

We think, however, that the court is not here driven to the extremity suggested in Barber v. Barber, supra, but that the judgment appealed from, which subjected the income of this trust fund to the provisions of the divorce judgment, can be sustained, both upon principle and precedent.

Why, it may be asked, should not the income of this trust fund be thus subjected? The appellants say because, under the rule laid down in Romaine v. Chauncey, 129 N. Y. 566; 42 St. Rep. 267, alimony is not, strictly speaking, a debt due to the wife from her husband, nor, consequently, is her claim thereto that of an ordinary creditor. From this postulate the appellants reason that as it is only a creditor who, under the statute, can reach surplus income beyond what is necessary for the support of the beneficiary, the plaintiff, not being such creditor, is wholly without equity. The answer to this position is that the rights of the wife and children do not depend upon mere definitions of the term “alimony,” and that her and their claim to support is higher and greater than that of an ordinary creditor. The question is not whether these children have become, by operation of law, their father’s creditors; nor whether the divorce judgment has transformed the wife and husband into the technical relation of creditor and debtor; but whether the provision duly made for her support and lor the support of the children,—no matter how it may be styled or what it may be likened unto—shall be enforced.

We have said that the claim of the wife and children to support is higher and greater than that of any ordinary creditor. We mean this in a legal as well as in. a moral sense; and for this reason : The beneficiary’s wife and children are included in the personal use to which the income of the trust fund is to be applied. All the cases where surplus income has been applied to the claims of creditors limit the surplus to what may remain after making due provision for the suitable support and maintenance of the cestui que trust and those dependent upon him. The court first determines what'is necessary for the support, not of the debtor alone, but of him and his family. Williams v. Thorn, 70 N. Y. 270 ; Tolles v. Wood, 99 N. Y. 616 ; McEvoy v. Appleby, 27 Hun, 44.

Thus the wife and children are treated in equity substantially as beneficiaries. They are not severed from the personality of the cestui que trust, but are embraced within it. Their use is his use. Why ? Clearly because of his legal obligation to support and maintain them. Thus the legal obligation is interwoven with the trust, becomes part of it and vests in the wife and children, jointly with the beneficiary and as his family, the right to support and maintenance out of the trust income. This right surely cannot be lost because of the misconduct of the husband, which has broken up the family and driven the wife and children to living apart from him. If Mr. Wetmore had creditors to-day who were seeking the surplus income of this trust fund, would the court give them the entire surplus, after providing for his individual support? Would not the court still limit the surplus to what should be left after providing for Mr. Wetmore and his family ? That is, for himself and those who are still the subjects of his family obligation ? We think this is clearly the logic of the situation.

The legal obligation of the divorce judgment is now substituted for the uncontested legal obligation which existed when the parties were living together. The former is now interwoven with the trust the same as was the latter. And thus the application of the trust income to the support and maintenance of the wife and children, under the provisions of the divorce, judgment, fulfills the trust direction.

But, further, what is the judgment appealed from but a substitute for the compulsory process whereby the court would have compelled Mr. Wetmore, if present, to apply this very income— when received by him—as required by the divorce judgment? In England similar decrees were granted by the court of chancery, founded upon the action of the ecclesiastical court, and such decrees were treated as substitutes, rendered necessary by the husband’s flight, for the writ of ne exeat regno. Thus, in Watkyns v. Watlcyns, 2 Atk. 97, it was held that, as the husband had left the kingdom, interest out of trust money should be paid to the wife until he thought proper to return and maintain her as he ought. Lord Hardwicke said : “I can do no more in this case than Lord Chancellor King did in the case of Colemore v. Colemore, where he framed his decree by way of analogy to the writ of ne exeat regno, and impounded the fortune of the husband for the wife’s maintenance till he should think proper to return.”

In Head v. Head, 3 Atk., 295, the chancellor again refers to Colemore v. Colemore, in these words : “And I remember * * * the husband had, after a sentence for alimony, made over his whole estate to trustees and then went to the West Indies; and upon a bill brought by the wife against the trustees he (the chancellor) directed them to pay her a considerable maintenance out of the trust estate whilst the husband resided abroad."

The same doctrine was suggested in Miller v. Miller, 1 Abb. N. C. 30, and was fully maintained by the general term of the third department in Thompson v. Thompson, 52 Hun, 456; 24 St. Rep. 108. In the latter case the question was directly involved, and Landon, J., met it in these words: “The trial court held, and we think properly, that the trust created by the will of Gilbert G. Thompson, for the support of Charles Thompson, extends also to the support of his wife and child, and tlipt a judicial provision for their support out of the income is a proper application of a portion of the income, and paramount to the rights of judgment creditors."

Upon both principal and authority, therefore, we think the application of the trust income to„the support of Mr. Wetm ore’s wife and children, as provided in the divorce judgment, was, under the circumstances, proper.

This view of the case eliminates from the discussion the point that no foundation was laid for the appropriation of surplus income. - As the plaintiff was not treated as an ordinary creditor, there was no question of surplus properly before the court. There was nothing to be ascertained upon that head. Upon the facts found at special term, without exception, the entire income was applicable to the support of the beneficiary and his family while they lived together. It was equally applicable to their support when, owing to Mr. Wetmore’s misconduct, his wife and children were compelled to live apart from him. As it cannot now be applied to their support, jointly, it must be applied equitably with due regard to the severance of domestic relations. In a proper case it would, doubtless, be apportioned in accordance with settled principles. Here, however, an apportionment was not required for any just purpose, as, upon the conceded facts, Mr. Wetmore needs none of this income, while the plaintiff and the children need it all, and more. The question of Mr. Wetmore’s means was necessarily gone into in the divorce action, and it was there found that in March, 1892, he was possessed-—-entirely apart from the trust fund under consideration—of an estate in his own right of the value of $200,000 and upwards, producing him an annual income of about $8,500. In the present action it was found that, as far back as the year 1887 or 1888, Mr. Wetmore was possessed of this estate of $200,000, and that his annual income, including the trust income, was about $15,000. We must assume that this condition of things has continued to the present time. If there were any phange of circumstances, it was certainly incumbent upon Mr. Wetmore to show it. In the absence of any finding of fact with regard to such change, we are bound to enforce the alimony judgment as rendered. The court there allowed Mrs. Wetmore $3,000 per annum, and each of the three children §1,000 per annum. The income derivable from the trust fund is but $4,500 per annum. Thus, even with the application of the entire income, there will still be a deficiency of $1,500 per annum, which Mr. Wetmore is required to pay—and which lie could be compelled to pay, but for his flight. Under these circumstances, to have apportioned the trust income, and allowed Mr. Wetmore unconditionally a part of it for his individual support would have been a mockery of justice. He has more "than enough for his individual support without it. If, however, it were apportioned conditionally, what would necessarily have been the condition ? Certainly, the payment to the plaintiff from his other property of a sum equivalent to that apportioned to him. The apportionment would then have been a needless formality. But the court might, with propriety, make a still more stringent condition—namely, the payment of the entire sum awarded by the divorce judgment. A demand for an apportionment is a demand for equity, and, if Mr. Wetmore demanded that equity, he should have offered to do the equity of complying with the provisions of the divorce judgment. He cannot, therefore, complain that, while in contempt of that judgment, the court has done the plaintiff the partial justice of impounding the arrears and directing the future application of the entire income, from time to time, as it accrues, to the satisfaction, in part, of his just obligations.

There is nothing in the point that the plaintiff’s remedy is confined to the accrued income which had accumulated at the time this action was brought. Even where the action is brought by an ordinary creditor to reach surplus income, it is well settled that the remedy of the creditor is not confined to a surplus which has accrued and accumulated in the hands of the trustees—provision may be made in the judgment directing the application of any future surplus until the same is fully paid. Williams v. Thorn, supra. The same rule is, a fortiori, applicable here. It would be absurd to require a fresh action quarterly. The principle having been once settled, a multiplicity of actions to enforce it will neither be required nor allowed.

The judgment was right, and should be affirmed, with costs.

Yah Brunt, P. J., and Parker, J., concur.


source: Caselaw Access Project

author: Ingraham, J.

license: Public Domain

text:
    John J. Emery, Pl’ff, v. The New York, Lake Erie and Western Railroad Company et al., Def’ts.

      (Supreme Court, New York Special Term,

      Filed June, 1894.)

    Injunction—Corporation—Minority.
    A minority bondholder should not be permitted to enjoin a very large majority of the stockholders or bondholders from carrying out a plan which they approve, unless some legal right of the minority is infringed or jeopardized thereby.
    Motion for injunction.

      James 0. Carter, Charles G Beaman and Charles L. Atterbury, for pl’ff; E. J. Phelps, F. L. Stetson and F. B. Jennings, for deft railroad company; II. B. Turner, for def’t trust company.
   Ingraham, J.

The relief demanded by the complaint is that1 the defendants be enjoined and restrained from recording a- certain mortgage executed by the defendant railroad company to the defendant trust company, as trustee, and from the execution, circulation, issue, sale or delivery of any bond or bonds to be secured thereby, with a temporary injunction before trial; and to entitle plaintiff to any injunction at this time it must appear from the facts shown before me that plaintiff will be entitled to a final judgment for the-relief demanded in the complaint. The papers are quite voluminous, but the question is a narrow one.

The New York, Lake Erie and Western Eailroad Company issued certain of its bonds, and to secure their payment executed a mortgage, known as the second consolidated mortgage, to the defendant trust company as trustee, and the plaintiff is the holder of $40,000 of the bonds secured by that mortgage. The railroad company having become insolvent, receivers were appointed, who are now in possession of the property, and the company made default in the payment of its coupons upon the bonds before mentioned, which became due on the 1st of December, 1893, and the 1st of June, 1894, whereupon a scheme for the reorganization of the company was devised, and in pursuance of that scheme it was proposed to make a new mortgage, to take the place of the second consolidated mortgage before mentioned, and to substitute bonds secured by this new mortgage for the bonds secured by the old second consolidated mortgage, when the holders of such bonds would consent; and in pursuance of this scheme a new mortgage has been executed by the Erie Eailroad Company to the trust company as trustees; and it is the issuing ot bonds hnder this new mortgage that the plaintiff seeks to restrain. A very-large majority of the holders of the bonds under the second consolidated mortgage have consented to the exchange—some thirty-one out of thirty-eight millions having so consented. The plaintiff has refused to consent, and seeks to restrain those bondholders who desire the exchange from receiving the new bonds, and the defendants from delivering to such bondholders the new bonds in exchange for the old.

While it is clear that there are certain obligations resting upon the majority; be they stockholders or bondholders, to refrain from doing any act as such majority that will infringe the legal rights of the minority, and that a court of equity will enforce and protect the rights of the minority, either by affirmative or injunctive relief, still, when the holder of a very small number of bonds or shares of stock seeks to enjoin a very large majority of the stockholders or bondholders from carrying out á plan which such majority deem to be for their benefit, I think the court, should not interfere, unless it plainly appears that some legal right of the minority is infringed or jeopardized; and plaintiff must show that the proposed action which he seeks to restrain will violate some substantial right which he has acquired by reason of his ownership of the bonds in question. There is not the slightest evidence to show that either of the defendants has done any act to force the plaintiff to join in this scheme, nor does the new mortgage on its face affect the right of any bondholder secured by the old mortgage. The plaintiff was at liberty to refuse to surrender his bonds, to wait until the mortgage can by its terms be foreclosed, and then take such proceedings to enforce his bonds as he could have taken had not this new mortgage been executed. lie still has the same legal rights, and will continue to have them, whether this new consolidated mortgage be recorded and bonds issued under it or not. It is not proposed to in any way destroy the mortgage which secures his bonds, or to dissipate the property covered by such mortgage. On the contrary, if the scheme which includes the substitution of the new bonds for the old is carried out, much property will come into the hands of the trustee, to which the plaintiff can claim his mortgage attached, which has never been in the possession of the trustee prior to this time.

The first of the two principal grounds upon which the plaintiff claims the right to an injunction is, that by"the new mortgage the railroad company proposes to transfer to the trust company, as trustee of that mortgage, a large amount of corporate stock, etc., which forms a portion of the property included in the old second consolidated mortgage, in such manner and to such extent that the same are freed and discharged of the lien of the old second consolidated mortgage. But after a moment’s consideration I think it is apparent that nothing that the defendants have done or propose to do can possibly take away from the trustee under the old mortgage any right to appropriate any of this security to the payment of the plaintiff’s bonds. Whatever property is covered by the old mortgage is subject to such mortgage, notwithstanding any disposition which the mortgagor can make of it, except so far as a title may be acquired by a bona fide holder for value. But in this case the transferee or mortgagee is the same corporation that is mortgagee for the benefit of the old bonds, and it receives all of these securities with full knowledge of the rights that the old bondholder has, and the trustee will, be clearly responsible to the holders of the bonds secured by the old mortgage if, when it obtained possession of these securities, it did any act that would tend to defeat or impair the lieu of the old mortgage upon the property mortgaged ; and the fact that the new bonds issued under the mortgage are negotiable could not, under well settled rules of law, give to a transferee of such bonds any greater right as to the property mortgaged than was given to the trustee under the mortgage. The negotiable character of the bonds issued under the new mortgage would not entitle their holder to any right which he did not acquire by the mortgage itself. Whether or not the trust company, as trustee of both mortgages, occupies an inconsistent position, it is not necessary for me to determine. The c >urt has ample power to remove the trust company, as trustee, upon the application of any of the cc-stui que trust, and to appoint a new trustee in its place; and if the plaintiff considers himself injured because the same corporation is trustee under both mortgages, he can apply to have the trustee under his mortgage removed and a new one appointed who will protect his interest; and the trust company, as trustee of either mortgage, is at all times under the control of the court, and at all times responsible for any wrongful act that will tend to injure the plaintiff.

There were imitations upon the argument, as in the brief -submitted, by plaintiff, that in some way not clearly defined the market value of plaintiff’s bonds had been affected by this act of the defendants. But, if that were so, it would not, I think, give to plaintiff a cause of action. As these parties are simply carrying -into effect a reorganization assented to by a very large majority of the bondholders, it is evident that these bondholders, by assenting to the reorganization, do not consider that it is an injury to their bonds. But even if it were, unless the act proposed is illegal and beyond the power of the defendants- to do, plaintiff would not be entitled to relief.

The second ground relied on by the plaintiff is, that under this second mortgage a majority of the bonds are deposited with -the Trust Company as trustee under the new mortgage, and that by a ■covenant in the new mortgage the trustee agrees that it, as the holder of said several bonds, shall be entitled to enforce said bonds and the several mortgages or other securities therefor, whenever and in such manner as the trustee may. deem necessary or proper in order to protect its interest as holder of said bonds, and the interest of the company and of the bondholders hereunder, as against the holders of similar bonds which shall not have been pledged under this indenture or otherwise; and that, in consequence'of this covenant and the ownership under it of a majority of the bonds secured by the old mortgage, the trustees would be bound to refuse its consent to foreclose, and that thus the plaintiff, or all the holders of bonds who did not exchange for the new bonds, would be forever prevented from enforcing the mortgage, as by the terms of the old mortgage before there could be a foreclosure the holders of a majority of the bonds must request the trustee to foreclose.,

At first I was much impressed with this objection, and it did seem as though a majority of the bondholders had met together and agreed that they would not foreclose the mortgage secured by their bonds, and thus prevent plaintiff from, ever obtaining the application of the mortgaged premises to the payment of his bonds, and it was in substance such an agreement as that that the court was asked to enjoin. But still assuming such to be the effect of this new arrangement, is any legal right of the plaintiff affected? He bought his bonds secured by the mortgage, which contained a provision subjecting him to the will of a majority, and providing that the mortgage should not be foreclosed until a majority requested its foreclosure. What legal right, then, has he to come in and say that the majority shall not agree that they will not request a foreclosure of the mortgage ? It may well be that a court of equity would say that it would not enforce such an agreement, or that, if plaintiff applies to the court to enforce this mortgage, alleging that the lack of a request by the majority was in consequence of this agreement or the ownership of the bonds by the trustee under this second mortgage, the court would give the plaintiff relief. But here we have a simple proposition that a majority of the bondholders do not want the mortgage foreclosed, and agree for a certain consideration that they will place the bonds in such a position that it will not be foreclosed ; and I cannot see that that action of the majority violates any legal right of the minority, or justifies a court of equity in enjoining the majority from acquiring what they consider to be an advantage by the execution of the agreement.

To grant this injunction would be in substance to allow the wishes of the holder of $40,000 of these bonds to control the holders of the rest of the $38,000,000, and that in a case where the courts have ample power in a proper proceeding at any time to protect the plaintiff, and enforce every right of his, notwithstanding any agreement that maybe made between the- holders of a majority of the bonds, the mortgagor or the mortgagee; and I can see no legal right of the plaintiff that has been or is to be infringed or impaired, and I do not think the plaintiff is entitled to any injunction.

Having given to the questions presented all the consideration that I have been able to, I am entirely satisfied that no cause of action is alleged, and that the plaintiff is not entitled to any relief.

The motion for an injunction is therefore denied, with costs.


author: Gaynor, J.

text:
    The People ex rel. Edward M. Goring, Pl’ff, v. The President and Board of Trustees of the Village of Wappingers Falls, Def't.

      Supreme Court, Dutchess Special Term,

      Filed June, 1894.)

    1. Election—Village—Omission to give notice.
    Where the time of election to fill an office is designated by the Constitution or by a statute, a village election is not invalid because the trustees failed to give notice.
    3. Same—Nomination.
    The Election Law does not make a nomination essential to an election, 8. Same—Name of office.
    The fact that the name of the office is not printed on the official ballots is not material.
    The charter of the village of Wappingers Falls, in Dutchess county, provides for a police justice in that village. In 1890 Thomas A. Gurney was elected police justice of the village for a full term of four years. He resigned after a few months’ service. Up to March 13th of this year no successor was ever elected or appointed by the board of trustees of the village to fill the vacancy so caused. The term for which Mr. Gurney had been elected expired in March, 1894. The village authorities did not give any notice nor call for the election of a police justice in the .annual election notice, nor was any nomination made for the office by any political party, nor was any independent nomination made under or in pursuance of the election law. The official ballots provided by the village authorities did not contain the name of the office, nor was any blank left on the official ballot where the voter could name a choice for the office. No nomination of any kind was made for the office prior to election day, but forty-four of the official ballots contained votes by paster as follows: “For Police Justice, Edward M. Goring.” The total number of votes polled was about three hundred and fifty, and no other candidate for police justice was voted for, and the forty-four votes received by Mr. Goring were canvassed for him. Within a few days he filed his oath of office with the village clerk, and subsequently demanded of the board of trustees that they furnish him with a court room, and that they fix his salary as such police justice. The trustees refused to comply with Mr. Goring’s request, or to recognize him as the police justice- of the village. Application was thereupon made for a peremptory writ of mandamus against the village authorities.

      Bernard J. Finney, for relator; Joseph F. Barnard, for the village.
   Gaynor, J.

The village of Wappingers Falls was incorporated under the general act for the incorporations of villages. It is provided in § 17 of the said act, as amended, that the trustees of any village of a population of three thousand or more may decide to have a polibe justice for the village, to be elected every four years; chap. 291, Laws 1870; and on January 6, 1890, the trustees of this village passed a resolution, in accordance with the statute, that a police justice for the village should be elected at the next village election, to occur on the third Tuesday of March, 1890, and at every fourth annual election thereafter, the term of office to be four years. At the annual election, held on the third Tuesday of March, 1894, the petitioner was the only person voted for for such office. He received forty-four votes, which were duly counted and certified. It is claimed, however, that the petitioner was not validly elected, and is not entitled to fill the office, and the president and trustees of the village refuse to provide him with a court room, or fix his salary, which it is their duty to do if he was elected. The trustees gave no notice in advance of the election that a police justice would be voted for, and no nomination of a candidate for the office was made by any political party, nor was any independent nomination made therefor, as provided by the ballot law, §§ 56, 57. In short, no nomination was made for the office. Also, the name of the office of police justice was not printed on the official ballots. From these omissions the learned counsel for the trustees contends that no one could be legally voted for at the election, and that, therefore, the petitioner was not elected. There seems to be no foundation for the contention. In respect of the omission to give notice of the election of police justice, I am referred to no provision of law requiring notice, and I find none in the ballot law. The requirement of § 62. is only that all nominations to office be posted. But even if certain officials were charged with the giving of such notice, and failed to do so, that would not prevent or invalidate the election. Election notices were quite generally required before the adoption of our present ballot law,, but it was uniformly held that where the time of election to fill an office was designated by the Constitution, or by a statute, that in itself was notice which all electors had to heed, and the omission of the official notice was not material. People ex rel. v. Cowles, 13 N. H. 350 ; The People v. O'Brien, 38 N. Y. 197; People ex rel. Smith v. Schiellein, 95 id. 124. This is still the rule. The statute, as has been seen, provides that this office should exist in the village, and be filed at the village elections if the trustees should pass a resolution to have the office, and they did so. Hence, the electors had the statute and the resolution as, notice. That no one was nominated for the office may seem singular, but that could not take from the electors the right to fill the office by their votes. There is room for the contention that voting would be less partisan and more intelligent at local elections, and that local offices would be better filled, if there were no nominations. Nomination to office was not formerly essential to an election, nor does our present ballot law make it so. Kor is the fact that the name of the office was not printed on the official ballot’s material. The contention is that it was properly omitted for the reason that it could not be voted for because there were no nominations for it. There is nothing in the ballot law to sustain this contention. It is otherwise ; for § 82, after providing that “there shall be provided as many different kinds of official ballots” as there are political parties or groups of independent electors making nominations, requires in the case of every election that “the names of all the offices to be filled thereat shall be printed” on each kind of ballot ; and the same section further provides that if the full number of candidates for the offices specified on the ballots shall not have been nominated by any political party or independent electors for whom a ballot is printed, “blank spaces shall be left on each ballot of such kind where the names of candidates would appear, except for such failure to nominate.” The electors who voted for the petitioner did so by means of pasters, designating the office and the person voted for, to fill it. They had a right to vote, notwithstanding the omission of the official ballots to designate the office. Ballot law, § 104. Let a peremptory writ issue.


author: McAdam, J.

text:
    Rosina B. Levell, Pl’ff, v. The Royal Arcanum, Def't.

      (New York Superior Court, Trial Term,

      Filed June, 1894.)

    1. Insurance—Life — Warranty.
    Where the insured, in his application, represented that he had never heen engaged in the manufacture or sale of intoxicating liquors, though he had been for several years a bartender, it is a breach of warranty and avoids the policy.

      2. Same — Knowledge of agent.
    The knowledge of the agent, through whom the insurance was procured, at the time the application was made, that the answer was false, will not prevent the company from setting up the breach of warranty which goes to the basis of the contract, as a defense to an action on the policy

      Action by the plaintiff as the beneficiary in a policy issued by the defendant, a benevolent organization. Defense, breach of warranty.

      Miller & Miller, for pl’ff; S. M. Lindsley, for def’t.
   McAdam, J.

The defendant, a benevolent corporation, introduced a temperance feature into its organization, and § 272 of its bylaws provides that “applications shall not be received from barkeepers,” etc. In furtherance of this view, the applications for membership require the applicant to answer a series of questions, among which are the following, Do you use alcoholic or other stimulants ? Are you now or have you ever been engaged 'in the manufacture or sale of intoxicating liquors?” , To both of these, questions the applicant answered “ No.9’

In the application the applicant further declared: “I am temporate in my habits,” * * * and “ I do hereby warrant the truthfulness of the statements in this application, and consent and agree that any untrue or fraudulent statement made therein shall forfeit the rights of myself and my family or dependents to all benefits and privileges therein.”

In the application, which is dated December 27, 1891, the applicant describes his occupation as that of bookkeeper, and his place of business, 868 West street, in the city of New York.

The.defendant claims that the answers to the above questions were false ; hence, there was a breach of the warranty, and no recovery can be had.

There was no proof given that the applicant did use alcoholic or other stimulants. But there was proof that for several years prior to December, 1891, he had been engaged as bartender for McKeever Brothers, at No. 386 West street, this city, the address given in the application as the applicant’s place of business at the time the application was made.

The applicant is presumed to have read the application and to have known its contents. Ins. Co. v. Fletcher, 117 U. S. R. 519.

There was no proof that the applicant at the time he made the application was not a bookkeeper in a lumber yard, further than may be inferred from the fact that the place of business disclosed in the application was not a lumber yard, but that of his former employers, McKeever Brothers, who were engaged in the liquor business.

Without considering or passing upon the other questions in the case, it is clear that there was a breach of the warranty in the answer given to the question, “Are you now or have you ever been engaged in the manufacture or sale of intoxicating liquors? ” A warranty is a stipulation in writing, on the literal truth or fulfillment of which the validity of the entire contract depends. Alexander on Law of Life Insurance, 51; May on Insurance, 3d ed., § 156; Foley v. Royal Arcanum, 60 St. Rep. 221; 28 N. Y. Supp. 952. The stipulation is considered to be on the face of the policy although it may be written on a subjoined paper referred to in the policy. Ripley v. Aetna Ins. Co., 30 N. Y. at p., 157. Whether the fact stated or the act stipulated for be material to the risk or not, is of no consequence, the contract being that the matter is as represented, or shall be as promised; and unless it prove so, whether from fraud, mistake, negligence or other cause, not proceeding from the insurer, or the intervention of the law or the act of God, the insured can have no claim, May on Ins. 3d ed., § 156.

In Dwight v. Germania L. Ins. Co., 103 N. Y. 841; 3 St. Rep. 115, the court said: ‘‘Where by plain and unambiguous language” * * "x" “the observance of an apparently immaterial requirement is made the condition of a valid contract, neither courts nor juries have the right to disregard it.” In that case the question in the application was as to the insured being or having been ‘‘engaged in or connected with the sale,” etc, of intoxicating liquors. The answer was “Ho.” In fact, he was proprietor of a hotel where such liquors were sold in bottles to guests of the house. The court of appeals held that the statement was false and forfeited the policy. There Dwight was not exposed to the temptation of intemperance, as in this case Levell was by his constantly pouring liquors and being asked to take drinks, as barkeepers generally are. In the Dwight case the court further said: “In considering the language in an insurance contract, the words of a promise are to be regarded as those of the promisor, while those of a representation upon which the promise is founded are the words of the promisee, and, in either case, are to be taken most strongly against the party using them.”

In Holland v. Supreme Council, 54 N. J. L. R. 490, it appeared that the insured, in his statement to the medical examiner, represented that he was not engaged “in the sale of liquors,” etc.; yet, in fact, he had for several years been a bartender. Held, that the contract to pay was avoided by the false representation.

Plaintiff contends that because a committee appointed by the defendant had reported to the local council that Levell was worthy of membership, defendant is estopped from availing itself of the falsity of answers to the medical examiner. If Levell.deceived the committee, as lie did the medical examiner, his beneficiary cannot profit by the deception. If the committee knew the facts, the defendant might still set up the breach of warranty. The committee consisted of but three members of the subordinate lodge, and, regarding these persons as agents of that special body, knowledge acquired by them cannot be imputed to and charged upon the grand lodge wdiich issued the beneficiary certificate; fór it has been held that knowledge of the agent of the company through whom the insurance was procured, at the time the application was made, that the answer was false, will not prevent the company from setting up the breach of warranty which goes to the basis of the contract, as a defense to an action upon the policy. Clemans v. Supreme Assembly, 131 N. Y. 485; 43 St. Rep. 571; Barleau v. Phœnix Ins. Co., 67 N. Y. 595 ; Ripley v. Ætna Ins. Co., 30 N. Y. 136; Jennings v. Chenango Ins. Co., 2 Denio, 75 ; Chase v. Hamilton Ins. Co., 20 N.Y. 52 ; Foot v. Ætna Ins. Co. 61 N. Y. 571; McCollum v. N. Y. Mutual Life Ins. Co., 55 Hun, 103; 28 St. Rep. 272; Sullivan v. Metropolitan Ins. Co., 26 St. Rep. 38; Cook on Life Ins., p. 37 ; and see cases cited in 103 N. Y., at p. 344.

Upon this ground the defendant is entitled to judgment, with costs. ' .


text:
    Berno Lewison, as receiver of the Order Germania, etc., Pl’ff, v. Louis Hoffman, Def’t.

      (New York Superior Court, Trial Term,

      Filed May, 1894.)

    1. Evidence—Reports of treasurer of society.
    The reports made to a society by its treasurer are presumptive, and if not impeached, conclusive evidence, not' only against the treasurer, but his sureties on the otlicial bond,
    2. Society—Treasurer—Sureties.
    Where such treasurer has held the same office under a prior appointment and has committed defaults during such term, the bond of the sureties given on his reappointment will not relate to defaults during the former term, in the absence of special stipulation to that effect.
    3. Same.
    Such sureties cannot be held for the misconduct of the predecessor of their principal, though the latter charges himself with moneys which his predecessor failed to pay over to him, , >
    4. Same—Demand.
    Section 1891 of the Code does not 'apply where the treasurer absconds and makes a demand impossible.
    The action was originally commenced by the “Order Germania,” a benevolent corporation, against Johanna Weiss and Louis Hoffman, as sureties upon the official bond of John Weiss, the treasurer of the corporation, to recover moneys received by said treasurer and not- paid over. Pending the action, Mr. Lewison was appointed receiver of the property and assets of the corporation, and was in his official capacity substituted as plaintiff. . Johanna Weiss, one of the sureties, departed this life, and the action was continued against Lonis Hoffman, the surviving surety. The main issue was as to the amount for which the surety was liable, and this depends upon the amount actually collected by the treasurer and not paid over by him.

      M. Auerbach, for pl’ff; L. S. Goebel, H. O. Botty and B. W. S. Johnston, for def’t.
   McAdam, J.

The “ Order Germania ” was created for benevolent purposes, and although a private corporation, was fashioned after public corporations in this, that it had a treasurer, who, like the treasurer of a county, had certain official duties prescribed which he was bound to perform, prominent among which were the collecting, accounting for and paying over moneys received on behalf of the order. As is usual in cases of public corporations, it was likewise required of the treasurer here that he execute a bond; with sufficient sureties, for the faithful performance of his -official duties. These duties required him not.only to receive moneys due to the order, but to account for and pay over the sums received. Like a county treasurer, he made reports to the order of the funds in his hands, and these reports, being made in the performance of his .official duties, became evidence not only against the treasurer, but against his sureties, for they had guaranteed the proper performance of his official acts. Bissell v. Saxton., 66 N. Y. 55 ; Shattuck v. Lamb, 65 N. Y. 499; Board v. Bristol, 15 Hun, 116; aff’d 99 N. Y. 316. In these cases it was held that the official report of the treasurer was competent, though not conclusive, evidence against the sureties. In Father Matthew Society v. Fitzwilliam, 12 Mo. App. Rep. 445, it was held that the treasurer’s statement, made in accordance with his duty, and during the period covered by the bond, but after his removal for misconduct, is competent against his sureties, and is prima facie evidence of the facts therein stated.

In cases of this nature the main inquiry is whether the reports or declarations of the principal were made during the transaction of the business for which the surety was bound, so as to become part of the res gestee. If so, they are held admissible, otherwise not. 1 Greenleaf on Ev., § 187; 2 Brandt on Suretyship (2 ed.), 886, 887.

The reports of Weiss, the treasurer, were more than declarations of the principal forming part of the res gestee, see Wood’s Pr. Ev., § 146 ; Greenleaf on Ev., § 109 ; they were in the nature of official acts, the accuracy of which was guaranteed by the bond. The order acted on these reports, as it lawfully might, and while it was in the power of the sureties to show any error in them, they constitute presumptive evidence of the facts therein contained, and unimpeached, are conclusive not only against the treasurer, but his sureties on the official bond. The very duties of the office required the treasurer to charge himself with the amounts received from the different subordinate lodges, and to report the amount so received semi-annually to the grand lodge. Weiss, the treasurer, in the performance of these duties made reports showing the amounts he received, and the amounts thus reported, having been returned and acted upon officially, became in the nature of accounts stated between the grand lodge and its treasurer, which, in the absence of fraud or mistake, are conclusive alike upon the lodge, its treasurer and his sureties. See Douglass v. Howland, 24 Wend. 59, cited with approval in Hatch v. Elkins, 65 N. Y. at p. 498 ; Moiley v. Town, 78 Ill. 394; S. C. 20 Am. R. 266.

That this was in the contemplation of all the parties in apparent from the tenor, effect and nature of the bond itself, and effect must be given to this understanding. Illustrations of the effect given to the rule in different cases will be found in Bank v. Smith, 12 Allen, 243 ; State v. Newton, 33 Ark. 276; McKim v. Blake, 139 Mass. R. 598; Pendleton v. Bank, 1 T. B. Mon. 171; and Lysaght v. Walker, 5 Bligh. N. R. 1.

The evidence shows that at the time the last official report was made Weiss owed the order $5.956.31. The plaintiff thereafter credited the account with $786.10, and with two items, one of $500 and another of $,1000, received from the sureties, leaving a balance of $3,670.21 due. Ho mistake was shown in the reports made; nor was it shown that the moneys charged by the treasurer as coming into his hands did not, in fact, reach his custodjr. The court carefully excluded all declarations nyide by Weiss, the treasurer, except those made officially and as official acts at regular and stated meetings of the lodge, when his duties required him to make such reports and to make them officially. The evidence shows that these moneys were never returned into the grand lodge, and that Weiss, the treasurer, absconded without rendering a propel account of his stewardship. The bond contemplated more than a mere accounting in writing; it was given to insure the payment over to the order of the funds which came to the hands of the treasurer in his official character as such.

In interpreting the meaning of the bond, the court has a right to consider all the surrounding circumstances—-the relations of the parties—and to construe it with reference to the laws under which the officer was appointed. Baylies on Sureties, 127. Where the bond is given for the faithful performance of the duties of an officer annully appointed, and it should happen that 'the same-individual had held the stime office under a prior appointment, and had defaults during the term of that appointment, the bond of. the sureties given on his reappointment will not be construed to relate to past defaults, in the absence of special stipulations to that effect. Bissell v. Saxton, supra; Baylies on Sureties, 127, 128.

It is claimed by the defendant, and there is some proof to sustain the contention, that-the treasurer of the order who was succeeded by Weiss was $2,000 behind in his accounts, and that this sum was charged against Weiss and forms part of the $3,670.21 claimed from him, and that the purpose of doing this was to conceal the fact of the deficit from the members of the order. While-this testimony is not as satisfactory as it ought to have been, the court will, in order to prevent any possible injustice to the defendant, disallow this portion of the account, and direct judgment, for the difference, $1,670.21, in respect to which there hardly seems to be any substantial ground for dispute. The sureties. cannot, on any principle, be held for the misconduct of the predecessor of Weiss, and if he in any form charged himself with moneys which his predecessor failed to turn over to him, this circumstance cannot create a liability against his sureties. This-seems to be a self-evident proposition.

The Code (see 1891) provides that in actions on the official bonds of “ public ” officers the plaintiff must prove a demand, “ or that a demand cannot be made with due diligence.” If a formal demand upon the treasurer of this private corporation was necessary, see Brandt on Suretyship, § 200, before charging the sureties on his official bond, it could not have been made with due diligence, 'because the treasurer absconded and made such demand impossible. See Baylies on Sureties, 134; Demand on the surety is admitted by the answer. The fact of the treasurer’s default was sufficiently proved, however, to call upon the defendant to prove that Weiss had accounted according to the terms of the bond.

The plaintiff is entitled to judgment for $1,670.21, with interest, from the commencement of the action, and costs.


author: Fitzsimons, J.

text:
    James T. Hall, as Receiver, etc., Pl’ff, v. The Holland House Company, Def’t.

      (New York City Court, Trial Term,

      Filed June, 1894.)

    Corporations—Insolvent—Counterclaim.
    A claim against an insolvent corporation will not tie allowed as an offset or counterclaim against its receiver, unless such claim accrued prior to the insolvency and appointment of receiver.

      Lachman, Morgenihau & Goldsmith, for pl’ff; Ooudert Brothers, for def’t.
   Fitzsimons, J.

The James T. Hall Company, a foreign corporation, became insolvent, and a temporary receiver of its property was appointed on October 11, 1893, and October 26, 1893, said temporary receiver was duly made permanent receiver. On October 26th a note of James T. Hall Company for five hundred ($500) dollars was indorsed over to defendant by one Mary J. Van Doren; the note became due October 16th.

This action is brought by plaintiff, as ¡permanent receiver, to recover five hundred and eighty-nine and 85-1000 dollars ($589.85) and interest, for work done by the James T, Hall Company for defendant, and defendant seeks to interpose as an offset or counterclaim the note of five hundred. dollars /$500) above mentioned.

The question presented is whether the note made by the Hall Company is a proper counterclaim herein.

The defendant’s cause of action against plaintiff accrued October 26th. On that day, and since October 11th, the Hall Company was an insolvent corporation; its property had passed out of its possession; it had no control over or interest in said property until its affiairs were duly settled; that property was the property,of the creditors of said corporation, and no claim can be made the subject of an offest or counterclaim by defendant against plaintiff’s cause of action unless it accrued prior to the insolvency of the Hall Company, which in this case occurred at the time of the appointment of a receiver, on October 11th. The fact that the receiver then appointed was a temporary one, in my judgment, does not benefit defendant. The rule of law applicable to this case seems to me to be, that defendant’s claim against the Hall Company will not be allowed as an offset or counterclaim against its receiver unless said claim accrued prior to its insolvency and appointment of the receiver, Fera v. Wickham, 135 N. Y. 230; 47 St. Rep. 866.

In view of this ruling, I deem it unnecessary to consider the other points presented by plaintiff’s counsel. I disallow the counterclaim, and give plaintiff judgment for the amount claimed, with interest and costs and five per cent, allowance.


author: Follett, J.

text:
    Felix St. Anna Govin et al., Resp’ts, v. Luciana Govin De Miranda, as Executrix, etc., App’lt.

      (Supreme Court, General Term, First Department,

      Filed June, 1894.)

    1. Judgment—Concdusiveness.
    The conclusiveness of a judgment cannot be distroyed by showing that a fact existed which, had it been proved, would have produced a wholly different judgment.
    2. Limitations—Trustee.
    Where the testator becomes a trustee for .the beneficiaries, the statute of limitations does not begin to run until he has refused to execute the trust.
    8. Interest—Contract.
    Interest payable by the terms of a contract presumptively belongs to whoever owns the contract when the interest falls due, unless it appears ' that the owner has assigned the interest due or becoming due, or, in case it is payable upon the presentation of coupons, that they have been detached and transferred by the owner.

      4. Same—Coupon bonds—Trust.
    Where the title to coupon bonds under declaration of trust has been established by a former action in replevin, interest collected by the creator of the'trust, who has retained possession, and by his executor, is recoverable up to the time of a refusal to deliver the bonds upon a demand of the beneficiary.
    Appeal from a judgment entered on a verdict directed .by the court, and from an order denying a notion for a new trial made on the minutes.

      Edward G. James, for app’lt,; A5?-am Kling, for resp’ts.
   Follett, J.

Prior to December 8th, 1883, Felix Govin y Pinto purchased and paid for thirty-eight coupon bonds issued by the Chicago, Burlington & Quincy Railroad Company, for one thousand dollars each, bearing interest at the rate of four per cent, per annum, payable semi-annually, the payment of which was secured by a mortgage upon the Iowa Division of said corporation.

On the 8th of December, 1883, Felix Govin y Pinto executed an instrument, written by himself, of which the following is a copy:

“ In possession of Ramon M. Estevez there are $60,000, in II. 5. bonds, which I declare belong to the- three children, brother and sisters, Emilia, Felix and Guillermina Govin, residents of this city, living at 147 East Thirty-ninth street. Besides, in my box there is a legacy which contains $29,000 fi. R. bonds, Iowa Division; of these ten thousand belong to Luz Diaz y Sanchez, mother of the above mentioned individuals; she has a note for same, signed by me, and the rest belongs to the above mentioned Emilia, Felix and Guillermina in equal parts. No one may go contrary or against this declaration, as it is based under conscience and justice; to me alone is reserved the right to do with this money as I deem proper. Felix Govin y Pinto.

11 New York, December 8ih, 1888.

“ Acknowledged before me this 15th day of December, 1883.- “ James W. Hale,

“Notario Publico, 4 Hanover street.”

This instrument was sealed in an envelope, on which was the following indorsement: “ A declaration in favor of Emilia, Felix, Guillermina Govin and Luz Diaz y Sanchez, who lived in 147 East Thirty-ninth street.”

May 23d, 1891, Felix 'Govin y Pinto died at the city of New York, leaving a last will and testament, which was duly probated November 20th, 1891, and letters testamentary thereon were on that, day issued to the defendant, who accepted the trust and entered on the execution thereof. After the death of the testator the declaration of trust, sealed in an envelope and endorsed as above stated, was found in the safe, and there were also found in the vault of a safe deposit company thirty-eight bonds of the Chicago, Burlington & Quincy Railroad Company of the kind above described.- The testator collected the interest which fell due on these bonds during his lifetime, and subsequent to his death the interest was collected by the defendant.

It is conceded that the testator, in his lifetime, supported the plaintiffs in this action, who, with their mother, Luz Diaz y Sanchez, lived together as a family at No. 147 East Thirty-ninth street, New'York city.

Whether the testator and the plaintiff’s mother were married is a disputed question.

January 13th, 1892, the plaintiffs demanded that the defendant deliver to them nineteen of the Chicago, Burlington & Quincy bonds, which was refused, and March 25th, 1892, these plaintiffs brought against this defendant an action, in replevin, for the recovery of the bonds, in which an issue was joined, and resulted in a judgment for the recovery of the bonds, or, in default of their delivery, for the recovery of tlieir value (17,950), with interest thereon at the rate of six per cent, per annum from January 13th, 1892, to February 27th, 1893, the date of the trial of that action, which judgment was affirmed December 22d, 1893, by the court of appeals, 140 N Y. 474 ; 55 St. Rep. 837. Whether the bonds have been restored or the judgment for tlieir value paid does not appear.

On the 22d of August, 1893, this action was begun to recover the interest on the nineteen bonds collected by the testator in his lifetime and by the defendant as his executor, with interest on the sums so semi-annually collected. On the trial a verdict was directed for §12,034.80, which amount seems to have been agreed upon, or, at least, not contested. How much of this sum was for coupons collected by the testator, or how much for coupons collected by the defendant does not appear, nor does the record disclose the particular semi-annual payments of interest covered by the verdict, or the amount allowed for interest on such semi-annual payments as were included in the sum recovered.

It has been finally determined in the replevin action that the plaintiffs, on the 8th of December, 1893, were and have since remained the owners of nineteen of the bonds of the Chicago, Burlington & Quincy Railroad, which judgment is conclusive of the question of title to the bonds, and cannot be litigated in this action.

The fact that it appeal’s in this case that the testator, prior to December 8, 1893, pxxrchased and paid for the bonds in dispute, which fact was not shown on the former trial, does not axithorize this court to reconsider the question of ownership. If this fact is a conti’olling one upon the rights of the' litigants, the defendant should have proved it on the trial of the former action, or, if unknown at that date, she should have moved for a ney trial on the ground of newly discovered evidence. The conclusiveness of the first judgment cannot be destroyed by showing that a fact existed which, had it been proved, would have produced a wholly different judgment. The Williamsburgh Savings Bank v. The Town of Solon, 136 N. Y. 465; 49 St. Rep. 840. This rule is so elementaxy that it does not need to be supported by the citation of cases.. To hold the contrary would destroy the effect of judgments and permit questions once settled to be relitigated upon the discovery of some new fact.

It being conceded that the defendant and her testator collected the interest on plaintiffs’ bonds, it is difficult to see on what theory the defendant can escape a judgment for the recovexy of the amount so collected without establishing an affirmative defense.

The interest payable by the terms of a contract is but an incident thereof, and presumptively belongs to whoever owns the contract when the interest falls due. This is a rebuttable presumption, which may be overthrown by showing that the owner had assigned the interest due, or becoming due, and in case it is payable upon the presentation of coupons, that they have been detached and transferred by the ownei’. There is no evidence in this case indicative of an intention on the part of the, plaintiffs to relinquish the interest, and the only fact to which we are referred tending to show that the interest belonged not to the plaintiffs but to the testator, is the last clause of the instrument of December 8th, 1893: “ Ho one may go contrary or against this declaration, as it is based under conscience and justice; to me alone is reserved the right to do with this money as I deem proper.” This language was not intended to limit, but to make certain the rights of the beneficiaries, and it is an assertion by the declarant that he had the right to do as he chose with the bónds, and that third persons had no right to question the disposition which he made of tnem. The declarant, by this clause, did not reserve, or intend to reserve, to himself the right to dispose of the accruing interest on the bonds, which he declared belonged to the beneficiaries.

The Statute of Limitations is not a bar, for several reasons : First, the testator became a trustee for the beneficiaries, and the statute did not begin to run until he had refused to execute the trust. Further than this we are unable to determine, from the record in this case, for how long a period the' plaintiffs were permitted to recover the semi-annual interest, nor how much was recovered on account of the collections made by the defendant, and how mxxch on account of the collections made by the testator. Had the defendant intended to raise the question that recovery for some part of the interest collected was barred by the statxxte, she would have shown how much was collected anterior to the six or ten years preceding the date of the commencement of the action.

It is urged that the judgment in the replevin action is a bar to this, on the theory that the first judgment is the measure of the defendant’s liability to the plaintiffs for the conversion of the bonds. So it is. But the defendant’s testator never refused to deliver these bonds to the plaintiffs, but held the securities as an agent, and the defendant did not convert the bonds until she refused to deliver them upon the demand of the plaintiffs, who, in the first action, could recover only the bonds and the damages for their unlawful detention, which damages began to accrue from the date of such detention. The collections of the interest by the testator, and by the defendant before her refusal to deliver, were not wrongful but legal acts, and their liability to account as agents for the collections formed no part of the claim for damages for the wrongful detention of the bonds.

The judgment should be affirmed, with costs.

Van Brunt, P. J., and Parker, J., concur.


text:
    William Mc Cormack, App’lt, v. United Life and Accident Insurance Association, Resp’t.

      (Supreme Court, General Term, First Department,

      Filed June, 1894.)

    1. Insurance—Life—Club policy—Breach.
    A breach of warranty or false representations on the part of the insured is a defense to an action on a club policy by any one of the members of the club to enforce his lights under the policies.
    2. Appeal—Harmless.
    Where a case is conclusively established by unobjectionable evidence, an error in admitting additional incompetent evidence is harmless.
    Appeal from an interlocutory judgment, entered February 10, 1892, from a final judgment dismissing the complaint, entered March 15, 1893, on a verdict directed by the court, and from an order denying a motion for a new trial, made on the minutes, entered March 7, 1893.
    The defendant is a corporation incorporated prior to February 8, 1886, under chapter 175 of the Laws of 1883, entitled “An act to provide for the incorporation and regulation of co-operative or assessment life and casualty insurance associations and societies.”
    On the 8th day of Februaiy, 1886, William H. Story applied to the defendant, in writing, for insurance to the amount of $10,-000—$5,000 under a policy known as club insurance and $5,000 under a policy known as the regular life policy. The application contained, among others, the following inquiries to and answers given by the applicant:
    “ 8. Are you now in good health, and is your health usually good? Ans. Yes.
    “ 9. Have you ever had any serious illness, local disease or personal injury ? If yes, state nature, date, duration and severity of attack ? Ho. u

      “12. Have any material facts regarding your past health or present condition been omitted ? State facts fully. No.
    “13. Name and residence of your medical attendant ? Dr. Ruppaner, Hoffman House.”
    On the 9th of February, 1881), the defendant issued a club policy on said application to William H. Story, which contains the following provision:
    ■ “ By this policy of insurance (defendant) agrees to pay to William H. Story and members of Club No. 7, in equal proportion to those who have kept their certificates in force, if living, if not, then to the heirs-at-law of said member, within ninety days after due proof of the death of said member, a sum equal to the amount received from a death assessment, but not to exceed the sum of $5,000.”
    Among other conditions contained in the policy is the following:
    “ First. That the statements and declarations made by and on behalf of said member in his application'to become a member of said association, which are hereby referred to as the basis of this contract, and are a part thereof, and on the faith of which this certificate is issued, are in all respects true, and that no fact has been suppressed relating to his health or circumstances affecting the interests of said association or their inducement to accept the risk.”
    The application was received, accepted, and the policy issued on the 9th of February, 1886, but the insured did not pay the premium until May 16,, 1886, when the policy was delivered to him. Prior to February 27, 1886, the defendant issued nine other such policies to persons who were associated as membérs of club No. 7, one of which was issued- February 9, 1886, to the plaintiff for $5,000. The policies issued to the ten persons constituting club No. 7 were in all respects alike.
    It is admitted that William H. Story died November 1, 1886, due proof of which was filed with defendant‘March 1, 1887, and that the death assessment made on account of the policy and said death exceeded the sum of $5,000.
    It is alleged in the complaint that only'six members of said club, who had kept their policies in force, one of whom was the plaintiff, survived -William H. Story, and that plaintiff was entitled to recover one-seventh of five thousand dollars, $714.28, with interest from March 1, 1887.
    This action was begun'August 25,1887, to recover a judgment (1) that the policy be reformed so as to provide, in accordance with the alleged agreement between the parties, omitted from the policy by mutual mistake, as follows: “By this policy of insurance (defendant) agrees upon the death of any member of club No. 7, to pay in equal proportions to the wife or heirs of the deceased member and to the surviving members of said club who have kept their policies in force, a sum equal to the amount received from a death assessment not to exceed the sum of $5,000; ” and (2) from $714.28, with interest from March 1, 1887.
    The issue, whether the policy should be reformed, was tried before the' court without a jury, and the relief sought denied, on the ground that the policy, if reformed in accordance with the prayer of the plaintiff, would be prohibited by law and void, and an interlocutory judgment was entered in accordance with the decision. At the same circuit the issue, whether the plaintiff was entitled to recover any sum, was tried before a jury. At the close of the evidence a verdict was directed for the defendant and a motion for a new trial made on the minutes was denied, and from this order and the judgment entered on the verdict, and also from the interlocutory judgment, the plaintiff appeals.

      E. T. Óldham, for app’lt; Harry Wilber, for res’pt.
   Follett, J.

Construing the ten policies issued to the ten persons forming club No. 7 and the club circular (Exhibit A), explanatory of the defendant’s plan of club insurance, together, the legal effect of the contract of insurance is as alleged in the complaint, and the reformation of the policy in accordance with the prayer of the plaintiff would not affect the rights of the litigants. It is not alleged in the answer that the contract set out in the complaint is a wager policy, or that it is for any cause void under the laws of the state, and on the trial the defendant expressly waived this defense.

As a defense, it is alleged in the answer that the answers given to questions 8,. 9 and 12 were untrue, and that William H. Story was not, at the time, the insurance was effected, in good health, but was suffering from a disease of the throat and tongue, from which he died, which disease he concealed from the defendant A breach of warranty, or false representations on the part of the insured, is a defense to an action brought by any one of the members of the club to enforce his rights under the ten policies, as a member of the club stands in the same position as the representatives of a deceased member, and an action in his behalf is subject to the same defenses that an action would be, brought by the wife or heirs of the decedent. On the trial of this action the defendant sought to show that William H. Story died of cancer of the tongue, and that he had this disease at the date of his application for the policy. One of his partners (Mr. Hancock) testified that Story sailed for Europe May 18th, 1886, and returned to New York about the middle of August of the same year, and whi le absent his tongue had been removed. This witness testified: “Before he went to Europe I looked at his tongue; I presume I saw it half a dozen times; I knew for two or three years, not that lie had any disease of the tongue, but that he had a peculiar looking tongue; his tongue had a pimpular appearance; I know that it had this peculiar appearance during the period I have stated ; I saw it; he showed it to me for the purpose of having me see it; his tongue had at times an appearance of having a heavy coating, and at times it would be red; no soreness, apparently, about it; Mr. Story said he thought the appearance of his tongue was occasioned by disordered digestion, a disordered state of the stomach ; that is all the reason he ever gave for it; in regard to Ms smoking habits, I think he thought that aggravated the condition of his tongue; at one time he stopped smoking, and I think that was the reason of it.

“Q. When you discovered this redness of the tongue, - on the occasion that he showed it to you, was the entire tongue involved, or was it confined po any particular part of it ?

“ I don’t know that there was any difference in any particular part of the tongue in this appearance..

“ Q. Did you, at any time, before he went to Europe, see his tongue, when you discovered that there was a sore upon it ?

“ A. Yes; I did.

“ Q. On how many different occasions ?

“A. Not more than twice; I don’t know as more than once; once or twice.

“ Q. How long was that before his departure ?

“A. I should think a few days; I could not swear positively about that.

“Q. No portion of his tongue had been eaten away by that sore before his departure for Europe? ”

Upon the cross-examination the witness testified that the sore which he saw on Story’s tongue before he left was of the size of an ordinary field pea, was on the right side of and about one-half inch back of the point of the tongue, but that it had not festered. He also testified that up to the day he sailed for Europe he was a strong, powerful, robust man; in excellent health, and had been peculiarly free from sickness.

Andther partner of Mr. Story (Mr. Mascord) testified that the insured, prior to his sailing for Europe, appeared to be a man in vigorous health, but that just before he sailed he saw his tongue, and it seemed to be ihflamed, but there was no festering, no part of it gone, but it was red.

A third partner of Mr. Story (Mr. Halstead) testified that he knew Story had some trouble with his tongue prior to his sailing for Europe, and that he stated that he was going abroad in the hope of being benefited by the water of some Herman spring, which had been recommended by Dr. Euppaner. The witness testified that he knew as early as January, 1886, that Story had trouble with his tongue.

That the insured died of some disease of the tongue and throat was not denied, nor was any evidence given tending to contradict that given by his partners.

The defendant’s surgeon, who examined Story when he applied for insurance, testified that he appeared to be a perfectly healthy man and free from disease, though he told him he had a pimple on his tongue which Dr. Euppaner said was not serions. He testified that he examined ,the tip of Story’s tongue and noticed a pimple, like those that people have when it is said they have told , a-lie. Under this .state of the evidence we think there was no question of fact for the jury as to whether the insured had the disease at the date of the policy.

It is urged that the court erred in permitting three physicians, Drs. Euppaner, Keys and Dennis, who had treated Story, to testify to certain facts. Their evidence was objected to, on the ground that it was inadmissible under § 834 of the Code of Civil Procedure, which provides: “A person duly authorized to practice physic and surgery shall not be allowed to disclose any informat’on which he acquired in attending a patient in a professional capacity which was necessary to enable him to act in that capacity.” The objection was overruled and an exception was taken.

Dr. Ruppaner testified that between May 28th, 1885, and May 17th, 1886, Story called on him for professional advice on twenty-four different occasions. The witness did not state what information he received from Story, or what advice he gave him, but he did testify that all of the visits were professional, and that for twenty-six years he had made a specialty of treating diseases of the throat, chest' and heart, and that he had no relations with Story except professional ones.

Dr. Edward L Keys was permitted to testify: “I have had experience in treating cancers; been general surgeon in the hospital for fifteen years; I have treated cancer of the tongue; I have hot had very much experience in treating these; I have had during my practice not more than half a dozen at the outside; not many; I knew William H. Story in his lifetime; I first made his acquaintance in my office; I suppose he called on me because I was a physician ; he called to consult as such; he made his first call in January, 1885 ; January 6th, I think it was; he made six calls in my office in all; the last call was made in March, 1885; none of those calls were of a social nature; they were all made upon me as a physician; I prescribed for him on all occasions, I believe, when he called at my office; I remember his disease particularly, because it interested me.”

Dr. Francis S. Dennis was called, and testified that he was a physician, and that he saw Story professionally; twice in April, 1886, and also after he returned from Europe. This witness was allowed to testify that, on the occasion of his first interview with Story, he examined his tongue and throat, and that for fifteen years the witness had been engaged in treating diseases of the tongue and throat.

‘ It is urged that these physicians disclosed no information derived from Story while they were treating him in a professional capacity. While this may be technically true, we think that, by permitting the defendant to show, by these witnesses, that they had treated him for some disease for a long time anterior to the date of the policy, and that they were specialists and accustomed to treat cancers and diseases of the tongue and throat, that the ■spirit of the section was violated, and an error was committed in admitting this evidence over the objection of the plaintiff. But, under the state of the record, we do not think this error calls for a reversal of the judgment, for, if all the testimony given by the physicians be stricken from the record, there remains the uncontradicted evidence of the three partners of Story, that for some months bsfore he sailed for Europe he had been suffering from some disease of the tongue, and that after his return from Europe they saw that his tongue had been removed, and that November 1st he died from the effects of the disease.

The evidence not presenting a question of fact for the jury, and no question of fact arising over the issue to which the incompetent evidence was relevant, we are not called on to reverse the judgment, which should be affirmed, with costs.

Van Brunt, P. J., and Parker, J., concur.


author: Per Curiam.

text:
    Anna E. Grant, by her Guardian ad litem, etc., Resp’t, v. Village of Groton, App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed May 18, 1894.)

    1. Evidence—Declarations.
    In an action for personal injuries, declarations of plaintiff as to his sufferings, made several months after the accident, are not admissible.
    3. Same—Expert.
    Non-expert witnesses cannot testify, in an action for personal injuries, as to the mental condition and impaired memory of the plaintiff after the accident occurred.
    Appeal from a judgment in favor of plaintiff.

      G. M. Stoddard, for app’lt; Smith & Dickinson, for resp’t.
   Per Curiam.

In the course of the charge the trial judge submitted to the jury the question whether it was a negligent act or a prudent act or an imprudent act and a negligent act on the part of the commissioners to omit to put up a warning or guhrds at the end of the sidewalk to keep people from walking off from the sidewalk and onto the bridge that was in that defective condition. He added: “If you say it was an imprudent act, it was a negligent act, why, then the village is responsible for-the negligent act ot the commissioner of highways ; for it was his business to keep those roads in safety. He was acting for the' village in that respect.’ And again he charged: “But it was his business to take care that the sidewalks were not permitted to be left open to this hole.” An exception was taken to the charge as thus given. No such negligence was alleged in the complaint, and it is at least questionable whether the plaintiff should have been permitted to recover upon the ground so stated in the charge. We think it vras error to receive the declarations of the plaintiff as to headache, made several months after the accident occurred. Roche v. Brooklyn, C. & N. Railroad Co., 105 N. Y. 294; 7 St. Rep. 361. Non-expert witnesses were improperly permitted to testify as to mental condition and impaired memory of the plaintiff after the accident occurred. We grant a new trial upon the exceptions.


author: Hardin, P. J.

text:
    William H. Kirk, Resp’t, v. Village of Homer, App’lt.

      (Supreme Court, General Term, Fourth Department,

      Filed May 18, 1894.)

    1. Municipal corporations—Streets — Repair.
    It is the duty of a municipal corporation to keep the sidewalks in a reasonably safe condition.
    3. Same — Notice.
    When it is a question for the jury whether the sidewalk was out of repair long enough to charge the village with notice of its unsafe condition.

      8. Damages — Excessive—Verdict for $1,000.
    A verdict for $1,000 for personal injuries was held not to be excessive under the facts of this case.
    Appeal from a judgment entered on a verdict in favor of plaintiff, and from an order denying a motion for a new trial on a case and exceptions. (

      Kellogg & Van Iloeser, for app’lt; J„ & T, K Courtney, for resp’t.
   Hardin, P. J.

Appellant was incorporated in 1885 by a special act of the legislature, chapter 290 of the Laws of 1835, and amendments were made by chapter 181 of the Laws of 1837, chapter 58 of the Laws of 1887, and chapter 386 of the Laws of 1889. Under the several acts, the village is a highway district, and its trustees are made commissioners of highways, and are given such powers and duties as commissioners of highways in towns, except as otherwise limited, and they are authorized to appoint a superintendent of highways. It was conceded on the trial that the village had “a duly appointed and acting street commissioner of the village of Homer for one year prior to the time of this accident, and down to that time.” Defendant moved for a nonsuit at the close of the plaintiff’s evidence on the ground that he has failed to show any negligence on the part of the defendant, and also on the ground that he has failed to bring notice or knowledge of the existence of any defect in this walk to the defendant; and at the close of the whole evidence the motion was renewed upon the further ground: “That it now affirmatively appears that the walk was repaired and put in reasonably safe condition on Wednesday or Thursday prior to the accident, and that the defendant cannot be charged with negligence if it got out of repair after that, unless it had notice of its condition, and that it was out of repair after that time, and that the evidence fails to show that it had any notice of its defective condition after that timealso, “that, if it was out of repair after it had been repaired on Wednesday or Thursday prior to the accident, it was not out of repair for a period of time long enough to charge the defendant with constructive notice of its condition.”

The motions were denied, and the defendant took an exception. Defendant’s witness Porter gave evidence to the effect that he had repaired the bridge on Wednesday or Thursday, and left it in a good condition. Several witnesses were called in behalf of the plaintiff, who testified that the walk, for a week or more before the accident, was in precisely the same condition that it had been for a year or so previous ; and after considering the cross-examination of Porter, the witness produced by the defendant, and the consideration of all the evidence offered by the plaintiff relating to the condition of the walk, we think it was a question of fact whether the repairs were made as testified to by Porter, and, if repairs were made as he testified, whether they were properly made, and whether the walk was out of repair a sufficient length of time after the repairs were made by him, were questions of fact for the consideration of the jury, and that the trial court committed no error in refusing to take the case from the jury in respect to the question of the defendant’s negligence in the premises. Pomfrey v. Village of Saratoga Springs, 104 N. Y. 459; 5 St. Rep. 802. Eugene Kirk testified that he passed the sluiceway on the afternoon of Sunday, the day of the plaintiff’s receiving, the injuries, and that he observéd-the condition of the bridge. He says: “The north stone was a big stone, and the south stone was smaller, and was kind of jagged on the north side of the south stone where they came together, and the crack between was from two to five or six inches where they were separated. They were further apart, I think, on the east side than on the west.”

After the method of repairs detailed by Porter was, by the evidence, bqiore the jury, and after it appeared that the stones which formed the bridge over the sluice were supported by cobbles, it was for the jury,'upon all the evidence, to determine—First, whether the repairs were sufficient and adequate for the purpose of retaining the stone in position; and, secondly, whether they w.ere placed in fact in close proximity, so as not to leave the opening which was found by the witness whose testimony has just been quoted, and which was observed by other witnesses who testify upon the subject. That the bridge was in an imperfect and defective condition at the time the plaintiff received the injuries is scarcely denied by the evidence, and it was for the jury, under all the circumstances disclosed, to determine how long the bridge had been in an imperfect and dangerous condition, and to determine from all the evidence whether it had been left in an improper condition for such a length of time as to properly challenge the notice of the defendant’s authorities. Kunz v. City of Troy, 104 N. Y. 344; 5 St. Rep. 642 ; Foels v. Town of Tonawanda, 75 Hun, 363 ; 56 St. Rep. 778. We are of the opinion, after a careful consideration of all the evidence bearing upon the -two questions of fact— First, that it was proper for the jury to consider whether the plaintiff was free from contributory negligence on the occasion, and that the evidence warranted a finding that he exercised reasonable care, and was not guilty of contributory negligence; and, secondly, that the evidence tended to establish that the defendant was guilty of negligence in leaving the walk in the condition in which it was at the time the plaintiff received the injuries alleged, and that the finding on that subject is not against the weight of the evidence. On the contrary, we are of the opinion that the verdict is rational, which establishes that defendant was guilty of negligence in leaving the walk in the condition in which it was at the time the plaintiff was injured.

The case of Bernstein v. D. D., E. B. & B. Railroad Co., 72 Hun, 46; 55 St. Rep. 341, is quite unlike the case before us. In that case it appeared that the defendant, while in the hospital, admitted that he jumped off the car when it was in motion, and other evidence was found in the case quite strongly indicating that the plaintiff was guilty of contributory negligence. We are of the opinion that the weight of the evidence is not so distinctly preponderating in favor of the defendant that the verdict ought to have been set aside by the trial judge, and that it was not his duty to grant a nonsuit. The case, therefore, before us, does not fall within the rule laid down in Linkauf v. Lombard, 137 N. Y. 426; 51 St. Rep. 63. It was for the jury to determine what credence should be given to^the testimony of Porter on the subject of the repairs referred to his evidence. Roseberry v. Nixon, 58 Hun, 121; 33 St. Rep. 981; Goldsmith v. Coverly, 56 St. Rep. 857; 27 N. Y. Supp. 116, and cases there cited. In Goodfellow v. City of New York, 100 N. Y. 18, the court repudiated the doctrine that a municipality “ performs its whole duty in respect to keeping the streets in safe condition for travel by instructing its subordinates to ascertain the facts and report.”

2. In the course of the charge submitting the question of negligence to the jury, the learned judge observed: “It is the duty of the defendant, through its officers, to see to it that its public streets and sidewalks which are maintained by the village,—and this duty, gentlemen, is an absolute duty on the part of the village,— to 'see that its streets and sidewalks are put and kept in a reasonably safe condition with reference to public travel; and that they are kept reasonably and suitably safe for persons who desire to pass over and along upon them.”

And he also said, later on : “ They may- construct, or they may not construct, a sidewalk: but, having constructed it,—having made a way and invited the public upon it,—they must see to it (and that duty becomes an absolute duty) that it is made at all times, night and day, reasonably safe and suitable for foot passengers. Have they performed their duty in this case ?

And after stating to the jury that, if they'had discharged their duty in that respect with such vigilance as the law requires, they are exempt from all liabilities from any accident which occurs, he added: “And that is upon the theory that the village is not an insurer. Its officers do not say to any person, ‘you walk along upon our streets, and you are assured and guaranteed against falling or against accident; ’ but they do say, in taking upon themselves the responsibility of the position of the government of the affairs of the municipality,— they do say to those who are invited along and upon their sidewalks and streets,— that they may go there with the assurance that the corporation and its officers have performed their duty in all respects as to keeping the sidewalks in suitable and safe repair. * * *"

At the close of the charge the defendant’s counsel said : “We desire to except to that portion of your honor’s charge in which you say that it is an absolute duty resting upon the defendant to see that its streets and sidewalks are put and kept in a reasonably safe condition for public travel, and safe for people to( pass over them.”

It is to be observed that this exception is broad, and covers some language which the judge had used, and which unquestionably was in accordance with the law, and therefore the exception may be regarded as too broad, as some portion of the language which was used was correct. The counsel continued in taking his exceptions, and said : “Also to that portion of the charge in which you say that the obligation rests upon the defendant to keep its walks - in repair, and it must see to that duty, as it is an absolute duty.”

In response thereto the court observed : “ I did not say to the jury that it was an absolute duty to keep it in repair. I said they owe an absolute duty to the public to keep their sidewalks in a reasonable safe and proper state of repair.”

Thereupon the defendant’s counsel observed : “We except to the proposition as now charged, and ■'also to that portion of the charge in which you say that, when they have once constructed a walk, then it is their business to see that it is kept reasonably safe for persons to pass over all the time, so that those who are invited to travel along their walks and streets may go there with the assurance that they have kept them safe and in repair.”

The response of the court was: “ Take an exception to whatever I said.”

We think the exception is somewhat indefinite. Ellis v. People, 21 How. Pr. 356. Doubtless, the trial judge intended to -lay down the rule approved in Turner v. City of Newburgh, 109 N. Y. 305 ; 15 St. Rep. 93, and we are inclined to think the language used by the trial judge in the body of his char-ge, and in response to the exception proposed by the defendant, when construed as a whole, does not tr-anscend the rule found in the case of Turner v. City of Newburgh. In the course of the opinion in that case Gray, J., says: “Municipal governments owe to the public the specific, Clear, and legal duty of putting and maintaining the public highways which are in their care, or under their management, in a good, safe, and secure condition, and any default in making them safe a2id secure, or in so maintaining them, if occurring through the negligence of the officials upon whom a duty is devolved by law, will i-ender the city liable. Where the unsafe condition occurs through some other agency or instrumentality, negligence is not imputable until a sufficient time has elapsed to charge the city officials with notice. Where a street is thrown open for the public use, those who travel upon it have the right to assume that it is in a reasonably safe condition, and if, without fault of their own, or -Without knowledge of some existing obstruction, they a2’e injured while lawfully using the street, the city is liable, unless the defect which has caused the injury has existed for so short a time that the city officials, by the exercise of reasonable care and supervision, could not have known it. The city is not an insurer of the safety of those who travel upon its highways, and those who do so are bound to use their faculties, and are held to the exercise of ordinary care and prudence. The duty of the city to keep its streets in a safe condition for public-travel is absolute, and it is bound to exe2’cise 1’easonable diligence and care to accomplish that end.”

The language used by the trial judge is so like that used by the court of appeals in the case cited that, under the circumstances, we do not incline to hold that the trial judge was in error-. See Pettengill v. City of Yonkers, 116 N. Y. 558; 27 St. Rep. 531. Without picking out isolated parts of the charge,—which we ought not to do,—but considering the whole char-ge together, we think it was sufficiently favorable to the defendant, Caldwell v. N. J. Steamboat Co., 47 N. Y. 282 ; Losee v. Buchanan, 51 N.Y. 493 ; Crist v. Erie Railway Co., 58 N. Y. 638.

Defendant contends the damages awarded were excessive. After the injuries, a physician was sent for by the plaintiff, and he attended the plaintiff for several days, and. examined the knee and ligaments of the knee and ankle, and apparently the pain was so great that the physician administered morphine hypodermically, and bandaged the knee with hot poultices and cloth bandages; and the plaintiff was obliged to remain upon a couch some two weeks before he sat up in a chair, and in about three weeks commenced using a crutch. The plaintiff testifies that it pained him more or less every day and every night, and that, if he walked a good deal, it pained him more than it would if he did not do anything; and he testifies that the pain kept him awake nights, and restless. The physician seems to have attributed the injuries to the synovial membrane and ligaments, and, although no bones were broken, he testifies that the injuries were along the muscles and membranes and soft tissues of the joint of the knee; and there was some evidence tending to raise the question whether the injuries would produce a rheumatic condition, from which suffering would ensue. We are not prepared, upon a full consideration of the evidence, to say that the jury committed an error in awarding damages, or that the trial judge was in error in refusing to reduce the damages.

Some other exceptions are found in the case to which attention has been given, and we have discovered no error in requiring us to interfere with the verdict of the jury.

Judgment and order affirmed, with costs.

All concur.